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India mulls barter system to satisfy Iran's basmati appetite amid sanctions

Nov 12, 2018

The payment system with Iran is being relaxed further for basmati rice exports. This comes after the US allowed India to continue importing crude oil from Iran and develop the Chabahar port.
 
Now, India is finalising guidelines for exporting basmati rice to its largest importer — Iran — on a rupee payment basis.
 
The move has come as a positive development for exporters who are paying a higher price for procuring basmati.
 
Last year, India exported $4.17 billion worth of basmati rice and Iran was the largest buyer of rice (at $905 million). In the first five months of 2018-19, exports have already crossed $2 billion and Iran continuous to be the largest buyer for India followed by Saudi Arabia.
 
When the US announced sanctions against Iran, farmers had already increased area under basmati but exporters were cautious. However, the recent exemption for Iran followed by easing of the payment crisis has lifted the sentiments of basmati exporters.
 
Higher paddy price this season has put some pressure on the retail price, especially if you consider that there is recession in the global market. However, there has been some stabilisation now and we expect a good basmati export cycle this year,” Kohinoor Foods joint managing director Gurnam Arora told Business Standard.
 
He further said that the ‘Iran issue’ had also been resolved to a large extent and traders have been allowed to barter deals and consignments valued in rupee terms. “The guidelines are being formulated and we are confident that Iranian basmati imports would start soon.
 
Iran normally opens its market for basmati import by mid November after taking into account its domestic production and demand matrices.
    
Source: Business Standard



RCEP trade ministers to meet on November 12-13 in Singapore

Nov 12, 2018

A crucial meeting of trade ministers of RCEP member countries, including India and China, will take place in Singapore on November 12-13 amid pressure being mounted on new Delhi to conclude talks for the proposed mega trade deal at the earliest, sources said. 
 
Regional Comprehensive Economic Partnership (RCEP) is a trade pact aims to cover goods, services, investments, economic and technical cooperation, competition and intellectual property rights. 
 
The meeting is crucial as there is pressure on India to conclude the negotiations as early as possible, despite the fact that still lot of issues are yet to be resolved, they said. 
 
Commerce and industry Minister Suresh Prabhu will represent India in the meeting. 
 
The trade ministers of the 16-member RCEP had urged participating countries to continue to exert all efforts towards meeting the targets set in the package of year end deliverables. 
 
The chief negotiators had concluded the 24th round of meeting in Auckland, New Zealand, last month. 
 
Several domestic industry sectors, including steel, food processing and metals are raising concerns over the presence of China in the group. 
 
    
Source: Economictimes.indiatimes



Indian food and agro buyer seller meet in Jeddah

Nov 12, 2018

Indian exporters of four key commodities of rice, tea, spices and dry fruits will be meeting the major importers in Saudi Arabia during a Food and Agro Buyer-Seller Meet (BSM) organised by Consulate General of India in Jeddah in association with Jeddah Chamber and Trade Promotion Council of India (TPCI). Twenty-five Indian companies from food and agricultural products sector, exporting rice, tea, spices and dry fruits, will be meeting the Saudi importers at the BSM which will be inaugurated by  by Md. Noor Rahman Sheikh, Consul General of India in Jeddah and Hassan IbraheemDahlan, Secretary General of Jeddah Chamber on November 11, 2018. 
 
The four commodities being focused on have great prospects for furthering Indian exports to Saudi Arabia. The Kingdom of Saudi Arabia has been a major food and beverages (F&B) market for India. The BSM will be an ideal platform for Indian participants to explore the business opportunities for trade, acquaint with new consumer trends and initiate marketing tie-ups and joint ventures. 
 
Basmati rice export continuously dominates India’s rice export basket. India accounts for around 72 per cent of the total Basmati rice produced and it offers India not just the leading producer tag but also very high product visibility in the world market. 
 
Indian tea, is among the finest in the world owing to strong geographical indicators, heavy investments in tea processing units, continuous innovation, augmented product mix and strategic market expansion. India is the 2nd largest producer and 4th largest exporter of tea in the world with a 23 per cent share in global production and a 7.5 per cent share in world tea exports. India exports tea to more than 60 countries globally with Iran, Russia, UK, USA and the Gulf countries being major markets .. 
 
Indian spices too are much in demand in the GCC countries, given their exquisite aroma, texture and taste. Saudi Arabia primarily imports pepper, chilli, turmeric, ginger and cardamom from India. 
 
Saudi Arabia is India’s one of the most important trade partnersand is a major FDI partner of India after the UAE in Gulf region. India’s export to Saudi Arabia was worth USD 5 billion in 2017. The major products exported by India to Saudi Arabia were rice, chemicals, refined petroleum oil and motor vehicles and its parts. India’s import from Saudi Arabia was worth USD 21 billion in 2017, amounting to a huge trade deficit of USD 16 billion. The major products imported by India from Saudi Arabia were petroleum products. 
 
    
Source: Economictimes.indiatimes



India, Russia banks to discuss rouble-rupee trade today

Nov 12, 2018

Representatives of atleast three Russian banks operating in India, including Vnesheconombank, Sberbank and VTB, will meet executives from top Indian banks in Mumbai on Monday to discuss rupee-rouble settlements between businesses of the two countries.
 
According to sources close to the development, the meeting being organised by the Indian Banks’ Association (IBA) will also see participation from the RBI and Russia’s central bank representatives.
 
India and Russia have been trying to establish mechanisms for trade in national currencies, bypassing the US dollar, for about a decade, but there has been little progress on the ground.
 
The need for rupee-rouble trade has increased in the past one year as Russia continues to face pressure of US sanctions. India-Russia bilateral trade is highly dominated by defence deals and several Russian defence majors contracted by the Indian government are currently under US sanctions. Since the beginning of this year, Indian banks have halted defence-related payments worth several billion US dollars.
 
The issue was raised during the 24th meeting of Indo-Russian working group on banking and financial matters held in August in the Russian city of Tula chaired by Ksenia Yudaeva, first Deputy Governor of the Central bank of Russia, and Bibhu Prasad Kanungo, Deputy Governor of the Reserve Bank of India. According to the minutes of the meeting reviewed by BusinessLine, the infrastructure for such settlements is in place, but banks need to make further progress to start transactions.
 
The Indian side expressed concern over negative implications of the US sanctions against Russia while the Russian side said these challenges can be addressed through a more accurate interpretation by Indian banks of the unilateral restrictions imposed against Russia by third countries. The Russian side said it will provide the Indian side with regular updates on the sanctions regime which would then be communicated by the RBI to Indian banks. Experts believe the current volume of trade between India and Russia, which is around $10 billion, is too less to move to settlements in national currencies, and for the beginning the countries could start with agreement on currency swap.
    
Source: The Hindu Business line



India contracts 8 lakh tonnes of sugar exports so far

Nov 12, 2018

Saddled with surplus stock, sugar mills in India -- the world's second largest producer, have contracted to export about 8,00,000 tonnes of the sweetener so far to countries like Middle East and Sri Lanka, a government official said. 
 
Out of the total contracted quantity, raw sugar comprises 6,00,000 tonnes and the rest 2,00,000 tonnes is white sugar, the official added. 
 
 
We are negotiating with various countries to boost export of sugar. China has agreed to buy and talks are on with Indonesia as well, the government official told PTI. 
 
To liquidate surplus stock, the government has asked domestic sugar millsNSE -1.10 % to mandatory export 5 million tonnes in the 2018-19 marketing year (October-September) and is even compensating expenses towards internal transport, freight, handling and other charges. 
 
The government is giving a transport subsidy of Rs 1,000 per tonne to the mills located within 100 km from ports, Rs 2,500 per tonne for mill located beyond 100 km from the port in coastal states and Rs 3,000 tonnes per tonne for mill located in other than coastal states. 
 
India produced a record 32.5 million tonnes of sugar in the 2017-18 marketing year and the output is estimated to be around same level or slightly lower in the current marketing year. The annual domestic demand is around 26 million tonnes. The country also has an opening stock of 10 million tonnes at the start of the current marketing year that began last month. 
 
    
Source: Economictimes.indiatimes



Canada's Saskatchewan to woo India for giving trade relations a boost

Nov 12, 2018

The Canadian Prairie province of Saskatchewan, with a population of just over a million, plays a mega role in the Indo-Canadian trade relationship. In November, Saskatchewan’s Premier Scott Moe — equivalent to the chief minister of an Indian state — will travel to India on a weeklong visit. He will explore ways to further the relationship in the face of some major headwinds that have cropped up in recent months.
 
Last year, Moe’s province alone accounted for more than a third of Canada’s exports to India, at over a billion dollars. India is the third largest market for Saskatchewan’s exports, behind the US and China. While Saskatchewan is among the world’s leading producer of pulses and accounts for over 40 per cent of the world’s – and virtually all of Canada’s – lentil exports, India has emerged as its top market for this commodity in recent years.
 
However, exports of pulses to India plunged this year after the central government sharply hiked import tariffs on pulse crops, pushing them up to 33 per cent for lentils and 50 per cent for peas.
 
Privately, experts believe the Indian hurdles to import of pulses may be related to domestic oversupply following good harvests and the need to protect farmers’ margins ahead of next year’s elections. In an interview after his keynote speech at the Canada-India Business Council’s Diwali gala in Toronto, Moe struck a positive note on the scope of trade with India despite the setback in the pulses sector.
 
    
Source: Business Standard



China may open doors for soyabean from India

Nov 12, 2018

China is likely to open its doors to soyabean from India after allowing the import of non-basmati rice and raw sugar to address the worsening trade imbalance between the two countries, according to senior government officials.
 
With China no longer willing to purchase soyabean from the US due to the on-going trade discord between the two, there is a big opportunity for Indian soyabean in the Chinese market. Senior trade officials from both countries discussed the steps to start imports from India during a recent meeting in Shanghai, an official told BusinessLine.
 
Soyabean is one of the items on which China imposed retaliatory duties of 25 per cent against the US in response to similar levies imposed by the Trump administration on Chinese products.
 
China, which buys more than half of the world’s soyabean produce, is importing huge quantities from Brazil to replace what it sourced from the US. Once it gives clearance to Indian exporters, it can start buying from India too, the official said.
 
China had already cut import tariffs on soyabean and soyabean meals from Bangladesh, India, Laos, South Korea and Sri Lanka in July to prepare for more imports from these countries following its reduced purchases from the US.
 
Earlier, Beijing had quality issues with Indian soyabean but several steps have been taken in India to ensure compliance with globally accepted norms. Hopefully, quality won’t be an issue now, the official said.
 
Quality inspectors from China are soon expected to visit India to inspect facilities.
 
Beijing had imposed a ban on import of soyabean meals from India in 2012 over sanitary and phytosanitary issues. India produces 10-11 million tonnes of soyabean annually. India’s total soyabean meal exports jumped to 2 mt for oil year 2016-17 (October-September) from 320,000 tonnes the previous year.
    
Source: The Hindu Businessline



Niti Aayog against abrupt curbs on export of agricultural items

Nov 12, 2018

Niti Aayog has argued against any abrupt restrictions on agriculture exports to meet domestic demand, suggesting instead that these should be resorted to in exceptional situations and producers should know well in advance of impending restrictions. 
 
If accepted by the government, this would ensure that Indian agriculture commodities have a dedicated market overseas as the focus of government moves from farm land to foreign land to help take India’s agriculture exports to $60 billion by 2022. 
 
Export restrictions on commodities should be resorted to in exceptional situations based on the principle trigger that the producer knows in advance, Niti Aayog’s agriculture expert and member, Ramesh Chand, told ET. 
 
Currently India exports a large number of agriculture commodities annually. 
 
However, this is subject to stable domestic market which means if demand goes up or prices soar in the domestic market, the government immediately stops exports mid-way as a result of which India is rarely seen as a consistent supplier of agri commodities to overseas destinations. 
 
The Aayog is of the view that agriculture production in India should have dedicated focus on exports and certain amount of all produce should be dedicated to exports. We should not be exporting residual produce but producing exclusively for exports, Chand added. 
 
    
Source: Economictimes.indiatimes



UP govt to buy coarse grains, brings maize under institutional procurement

Nov 12, 2018

To realise its plan to promote them, along with major cash crops such as paddy, wheat and sugarcane, the Yogi Adityanath government has decided to procure coarse grains as well from the state's farmers.
 
The government will procure 100,000 tonnes of maize through institutional channels between November 15, 2018, and January 15, 2019. This kharif season, the area under maize cultivation was pegged at 675,000 hectares in UP, while the government plans to set up 100 procurement centres for the crop. For 2018-19, the minimum support price (MSP) of maize was fixed at Rs 1,700 per quintal, compared to Rs 1,425 per quintal last year, an increase of Rs 275 per quintal.
 
Later, the procured maize would be disbursed to beneficiaries under the public distribution system (PDS), according to the state food and civil supplies department.
 
Earlier, UP Agriculture Minister Surya Pratap Shahi had told Business Standard the state was planning to bring more crops, including coarse grains, pulses and horticultural crops, under the institutional procurement system for further remunerating the farmers and achieving the goal of doubling rural income.
 
Since coarse grains require less water, while their farm input costs are economical compared to wheat and paddy, UP has been encouraging farmers to cultivate prominent coarse cereals like maize, jowar, bajra (millets) and jau (barley).
 
In UP, the area under these four coarse cereals stood at almost 2 million hectares (MH), or 9.75 per cent of the total 20.5 MH of cultivated area in the state. Production wise, the output of maize, jowar, millets and barley during 2016-17 was pegged at 4.7 million tonnes (mt), or a little under nine per cent of the total food grain production of 55.7 mt.
 
Coarse cereals were once extensively grown in UP. However, following the Green Revolution, paddy and wheat became the chief cash crops, relegating these indigenous 
    
Source: Business Standard



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