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Agriculture Export Policy to be in line with WTO norms

Aug 14, 2018

The proposed National Agriculture Export Policy — aimed at doubling the country’s farm exports to $60 billion by 2022, placing India among top 10 agriculture exporters in the world and promoting stability in export rules — is being vetted at the inter-ministerial level and will soon be placed before the Union Cabinet for approval.
 
All the measures proposed in the Agriculture Export Policy are compatible with World Trade Organisation norms. Financial provisions are being made only for measures that are permitted under global trade rules such as marketing and promotion and infrastructure building such as development of clusters, an industry source told BusinessLine.
 
With India moving out of the income bracket of per capital gross national income of less than $1000, it is not allowed by the WTO to give export sops.
    
Source: The Hindu Businessline



Commerce Ministry carries out fresh review of free trade pacts

Aug 14, 2018

The Commerce Ministry is carrying out a fresh review of all free trade agreements entered into by the country so far to analyse the impact of such agreements on various sectors, a government official said.
 
While similar studies have been carried out before, we felt that there is a need to find out how things stand at present. The idea is to examine each FTA and see where the Indian industry has gained and what challenges have cropped up due to the pacts, the official said.
 
The review is being carried out at a time when the government is struggling to figure out whether India will benefit from the ambitious Regional Comprehensive Economic Partnership (RCEP) being negotiated between 16 nations, including India, China and the 10-member ASEAN countries.
 
While the Centre sees the strategic merit of being part of the biggest free trade zone, the Indian industry is apprehensive of increased competition from the other member-countries, especially China.
 
The Indian industry and farmers have always been wary of free trade pacts. There have been complaints of cheap imports from countries with which India has signed FTAs rendering the domestic products uncompetitive. However, there are also instances where Indian exports have increased due to import duties lowered by FTA partner countries, the official said.
 
India has already implemented a plethora of free trade pacts with a number of countries including Sri Lanka, South Korea, Japan, Malaysia, Singapore and regions such as the ASEAN and SAARC.
 
Different sectors have had issues with different FTAs. For instance, the textile industry is not happy with concessions given to South Asia, especially Bangladesh, the electronic goods industry is not happy with concessions to South-East Asia, Japan and South Korea, the spices sector is concerned about imports from Sri Lanka, while the vanaspati industry has problems with concessions to Malaysia and Indonesia, the official said, adding that these were a few instances.
 
While it is not unusual for domestic industry to take a hit in the local market due to cheap imports when FTAs are signed, the bigger issue with India is that utilisation of FTA by Indian exporters to send their goods to partner countries is very low.
    
Source: The Hindu Businessline



India’s economic growth to improve in coming quarters: CII-ASCON

Aug 14, 2018

India’s economic growth will improve further in the coming quarters due to recovery in domestic demand as also the investment cycle, according to the CII-ASCON Industry Survey. It said the demand and investment will be supported by better consumption patterns on account of favourable monsoon, moderation in inflation and the onset of festive season.
 
The survey tracked the performance of 70 sectors during the first quarter of the current fiscal, as against the year-ago period. “The ASCON Q1 FY19 Survey results reflect steady progress in economic growth. What is especially significant is that there has been a perceptible increase in the share of sectors recording higher growth,” CII Director General Chandrajit said.
 
The survey witnessed fewer sectors anticipating negative growth trends, which clearly points towards improvement in the economic environment, he said. It showed a sharp increase in the sectors witnessing ‘Excellent’ growth (>20%) in April-June 2018-19, over the year-ago period.
 
The share of sectors witnessing ‘Excellent’ growth has improved to 14.3 per cent (10 out of 70 sectors) in Q1 FY19 from 5.7 per cent (4 out of 70) in Q1 FY18. At the same time, the share of sectors recording ‘High’ growth and ‘Moderate’ growth has improved marginally while the share of sectors witnessing ‘Low’ growth (<0%) has come down substantially.
 
With respect to issues and concerns impacting growth, ‘Competition from Imports’ (50 per cent), ‘Regulatory Burden’ (42.9 pc) and ‘Lack of required infrastructure’ (41.7 pc) have been reported as the top three most important issues for the industry. Exuding optimism on the near-term growth outlook, 63.6 per cent respondents expect the business situation in their respective sector to improve moderately where as 31 per cent expect the situation to remain same in the next six months.
    
Source: Financial Express



Foreign reserves in comfortable range: Report

Aug 14, 2018

India’s foreign reserves are in a “comfortable range” and another 5-8% fall in reserves will not jeopardise the situation, says a DBS report. 
 
According to the global financial services major, a challenging global environment has compelled RBI to intervene aggressively this year to contain rupee depreciation, resulting in significant drawdown in foreign reserves. 
 
Despite the recent decline, India’s reserves are in a comfortable range on most metrics. Given lingering external risks, another 5-8% fall in reserves is probable, but is unlikely to jeopardise the adequacy math by much, the report said. 
 
    
Source: Economictimes.indiatimes



FSSAI unveils initiative to collect, convert used cooking oil into biofuel

Aug 14, 2018

The Food Safety and Standards Authority of India (FSSAI) on Friday launched RUCO (Repurpose Used Cooking Oil), an initiative that will enable collection and conversion of used cooking oil to bio-diesel. The initiative has been launched nearly a month after the food safety regulator notified standards for used cooking oil.
 
FSSAI may also look at introducing regulations to ensure that companies that use large quantities of cooking oil hand it over to registered collecting agencies to convert it into biofuel.
 
Under this initiative, 64 companies at 101 locations have been identified to enable collection of used cooking oil. For instance: McDonald’s has already started converting used cooking oil to biodiesel from 100 outlets in Mumbai and Pune.
 
The regulator believes India has the potential to recover 220 crore litres of used cooking oil for the production of biodiesel by 2022 through a co-ordinated action. In a statement, Pawan Agarwal, CEO, FSSAI, said, While biodiesel produced from used cooking oil is currently very small, but a robust ecosystem for conversion and collection is rapidly growing in India and will soon reach a sizable scale.
    
Source: The Hindu Businessline



India can't afford to turn its back on free trade

Aug 14, 2018

India’s state is a mirror of its noisy, messy democracy. It’s often hard to achieve even a modest internal consensus between government departments in New Delhi: Right now, the heads of several ministries are scrambling to find a common position on the Regional Comprehensive Economic Partnership, or RCEP -- a giant trade deal that stitches together India, the Association of Southeast Asian Nations, Oceania, China, Japan and Korea. At the end of August, ministers from the 16 RCEP countries will meet in Singapore; India needs to work out a constructive stand by then. There’s a very real chance that, if New Delhi’s negotiators continue to be obstructionist, the other 15 countries will move ahead without India. 
 
For many here, that wouldn’t be a tragedy. And, frankly, even free-traders like myself see their point. India’s goods trade deficit with China appears unsustainable: It was $63 billion in 2017-18, up from $51 billion in the previous financial year and $16 billion ten years ago. That’s 60 percent of India’s overall trade deficit. As far as Indian policymakers are concerned, much of what’s being imported is sub-standard or otherwise fair game for anti-dumping legislation. 
    
Source: Economictimes.indiatimes



Cheap imports entering via Asean trade pact may hit Make in India

Aug 14, 2018

India’s big plan to boost ‘Make in India’ through higher import duties has encountered turbulence, with cheap products from overseas being routed into the country by misusing the freetrade agreement with the Association of South East Asian Nations. 
 
 
The Directorate of Revenue Intelligence, or DRI, is enquiring into imports of mobile phones and other telecom and IT equipment under the FTA route after allegations of abuse. “The agency has been asked to look into the issue,” said a government official privy to the development. India imposed customs duty on smartphones in July 2017 and subsequently increased the levy in the budget this year. Customs duties were also increased for automobile components, television LED/LCD and OLED panels, fruits juices, smart watches and sunglasses in the budget. 
 
The idea was to encourage ‘Make in India’ by disincentivising imports. However, some exporters are said to have started using Asean countries to route their exports to India to evade higher duties. What has rung alarm bells in the government is the entry of goods such as mobiles from China via an Asean member country without any substantial value addition, in violation of rules of origin, another government official said. 
    
Source: Economictimes.indiatimes



India, Afghanistan review development cooperation

Aug 14, 2018

India and Afghanistan reviewed the development projects in the war-torn country being implemented with Indian aid, including security of Indian personnel, during a meeting of the Joint Working Group on Development Cooperation (JWG-DC) in Kabul, the External Affairs Ministry said on Friday.
 
According to a ministry statement, during the meeting on Thursday, both sides had an exhaustive review of the large number of ongoing development projects spread over varied areas of cooperation such as capacity building, infrastructure, education, healthcare, good-governance and human resource development.
 
India is a leading development aid partner of Afghanistan having successfully implemented a large number of infrastructure projects, including the Afghan Parliament building, Afghan-India Friendship Dam, the first phase of the Chabahar port in Iran among others. 
 
The Chabahar port on the southeastern coast of Iran is being jointly developed by India, Iran and Afghanistan and is aimed at giving access to Afghanistan bypassing Pakistan.
 
According to the statement, the Afghan side appreciated India's timely assistance of 170,000 tonne of wheat and 2,000 tonne of pulses during this year when large parts of the country were suffering from drought. 
 
Both sides also expressed satisfaction that these largescale deliveries were made from India to Afghanistan via Chabahar, highlighting the viability of Chabahar as a route for trade and commerce, it stated. 
 
Both sides underscored the importance of access through Chabahar port for strengthening trade and economic relations.
    
Source: Sme Times



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