The Commerce and Industry Ministry has asked export promotion councils and other industry bodies to give specific inputs on measures to reduce regulatory compliances and streamline processes further and also share recommendations on decriminalisation, sources have said.

 

This is in line with the government’s stated policy of improving ease of doing business and working continuously to reduce compliance burden for a conducive business environment, a source tracking the matter told businessline.

 

'Inputs have been sought from export bodies on matters related to the Directorate General of Foreign Trade, Customs authorities, the RBI, the CBIC (Central Board of Indirect Taxes and Customs) and on the GST regime, sources tracking the matter told businessline.

 

Once the government receives inputs and processes them, the policies and the procedures will be modified accordingly, the source added.

 

'We are giving our suggestions on what processes can be further simplified. We are identifying areas where you can go for self-certification and where you can go for lesser documentation,' an official from an exporters’ body said.

 

Changes can also be made to the Foreign Trade Policy 2023 based on inputs as amending the policy is now a continuous process and not an annual one.

 

Key focus

The key focus of the government’s drive is simpli?cation of procedures related to applications, renewals, inspections, filing records, etc; rationalisation by repealing, amending or subsuming redundant laws; digitisation by creating online interfaces eliminating manual forms and records; and decriminalisation of minor technical or procedural defaults, Minister of State for Commerce Som Prakash recently said in a Parliament reply.

 

DPIIT, the industry arm of the Commerce and Industry Ministry, started an exercise some time back to assess the cost of regulations in states to provide insight into reforms that can be carried out to improve the business climate. A number of obsolete provisions have already been removed or simplified by DPIIT.

 

'Exporter bodies and other industry players have also been asked to give inputs for decriminalisation of provisions to be incorporated in the second edition of the Jan Vishwas Bill that the government is working on,' the official said.

 

The Jan Vishwas (Amendment of Provisions) Bill, 2023 was passed in the Lok Sabha on June 27 and in the Rajya Sabha on August 2. The Bill sought to decriminalise about 180 minor offences in 42 legislations including some colonial era laws. 

The Centre has so far procured 25,000 tonnes of onion grown in the 2023 kharif season for maintaining a buffer stock, Consumer Affairs Secretary Rohit Kumar Singh said on Monday. The government is procuring onion to maintain a buffer stock and use it for market intervention to boost domestic availability and keep prices in check.

 

The government has raised the buffer stock target to 7 lakh tonnes for the 2023-24 fiscal, against the actual stock of 3 lakh tonnes last year.

 

According to the Secretary, the government had procured 5 lakh tonnes from last year's rabi season and is purchasing 2 lakh tonnes of kharif onion as the buffer stock target has been raised.

 

'About 25,000 tonnes of kharif onion has so far been procured from mandis. The procurement is underway,' he told PTI.

 

Of the 5 lakh tonnes of rabi onion lying in the buffer stock, the government has offloaded 3.04 lakh tonnes of onion through cooperative Nafed and NCCF in the market to check prices.

 

As a result, the all-India average retail price of onion has come down by 27.58 per cent to Rs 42 per kg from over a month ago, he added.

 

To arrest sharp spikes in retail prices, the government has banned onion exports till March 31.

 

India’s Minister for Cooperation Amit Shah will launch an e-portal on January 4, 2024, to procure tur pulses above market prices, government sources informed CNBC-TV18. Through this e-portal, the centre aims to register available stocks that farmers intend to sell.

 

The pulses will be procured by government-backed cooperatives like NAFED (National Agricultural Cooperative Marketing Federation of India) and NCCF (National Cooperative Consumers' Federation of India) as per a dynamic pricing formula.

The move is aimed at incentivising farmers by ample remuneration, building a buffer stock as well as to reduce imports. As per government estimates, India is slated to import 12 lakh tonnes (LT) of pulses in the ongoing fiscal, which is more than 35% compared to the previous fiscal.

 

Centre’s decision comes after detailed discussions were held over the issue between the Ministry of Cooperation & Ministry of Consumer Affairs, Food and Public Distribution.

 

Rapid urbanisation, rising disposable income, retail boom and the ever-evolving consumer tastes and preferences, are leading to phenomenal growth in the Indian bakery industry. According to a report by market research firm IMARC, the industry is expected to grow at a 10.8% to reach $21.2 billion by 2028, from $11.3 billion in 2022.

 

Changing consumer lifestyle is influencing the demand for ready-to-eat (RTE) and bakery products. India’s thriving e-commerce food-delivery platforms that offer convenience of doorstep delivery are further augmenting this market growth. Current trends also indicate that the industry’s growth trajectory has innovation at its core.

 

Some of the trends that are emerging in this space include:

 

Healthier indulgence

Consumers palette is now inclined towards taste, good mouthfeel, exotic flavours and texture. Postpandemic, consumers are opting for mindful, portion-controlled indulgences and nutritionally fortified snack solutions such as high fibre, high protein bakes like dry fruit cake, nutty cookies and so on. Increasing popularity for natural and plant-based ingredients in baking (natural sweeteners, trans-fat free) compared to traditional baked goods.

 

Many of these are unique products created especially for the Indian market, where there is a rise in demand for snacks that are healthier yet tastier and keeping in mind the needs and challenges of the domestic bakery industry.

 

Healthy Bakes

With consumers increasingly inclining towards healthy eating habits, the bakery industry is witnessing a demand for healthy and nutritious baked food items. Along with multigrain, whole wheat or brown bread, there’s demand for gluten-free bread, cake, pastries, and biscuits. Consequently, bakery manufacturers are looking to introduce healthier options and working with partners who can invest in R&D to cater to evolving consumer demands, besides sourcing healthier ingredients, vegan fats and oils, iTFA (industrially produced trans fatty acids)-free products.

 

Bakers are also seeking help to develop innovative recipes in health cookies, energy bars and sugar-free bakes. As per reports, the market may see further expansion to reach $25.16 billion by 2032. Home bakers’segment is thriving on innovative recipes.

 

Longer shelf-life

In recent times, food manufacturers are looking for solutions to increase product shelf life, reduce wastage and keep costs under control. All these efforts ultimately lead to a better Return on Investment and help combat inflationary pressures, making it a win-win situation for everyone involved.

 

Innovative Customisation

Indian baking industry is also seeing a spurt in customisation and personalisation of products, driving demand for innovation.

 

There is a growing preference for premium and artisanal offerings in high-quality baked goods. The industry is also seeing a significant increase in artisanal bakers who seek value from their partners in the form of differentiation. They aim to bring in localised differentiation for their consumers by seeking application support, consumer insights, and regulatory advice from their corporate partners.

 

Emerging channels that drive growth

With Out of Home (OOH) consumption rapidly increasing in the country, large HoReCa (Hotels, Restaurants, Cafes) channel that contributes to approximately 7% of India’s GDP, is bound to be a lucrative channel of growth for the baking sector. In recent years, the emergence of online food delivery platforms has revolutionised the HoReCa industry for better.

 

Interactive and experimental baking

There’s a shift seen towards more interactive and experimental baking of regional styles. From taking online classes /workshops or trying out DIY kits to simply looking up recipes from different parts of the world and recreate them is a new trend favoured by new-age home bakers and artisanal bakers.

 

Partnerships & innovation

There’s intense competition among small, mid to large food manufacturers – all vying for a share of the same pie in the bakery industry. Home baking, which began during pandemic, has grown manifold. Home bakers are now successful entrepreneurs running business from their kitchen with easy access to technology, low investment, and marketing on social media.

 

Given the need for constant innovation in bakery sector, we organise boot camps at our Food Innovation Centre (Cargill Innovation Center) in Gurgaon and co-create recipes/solutions for customers. We offer market insights on bakery trends, offer customised and holistic solutions to meet unique needs of customers, among others. Our chefs, commercial and R&D teams work closely with customers to solve their challenges, becoming their go-to-partner for innovation and growth.

 

In line with consumers’ preferences for healthier, low-calorie baked items, we have also conducted live sessions on healthy bakes and demonstrated our product usage among bakers.

 

Road Ahead

The current growth momentum offers a great potential for business expansion, innovation, and employment generation – making bakery a flourishing sector for both established and new entrants in the market. Higher profitability the sector provides is an icing on the cake.

 

However, the industry is also evolving and adopting changes to meet the environment and sustainability goals. To reduce environmental impact, lately, the baking industry has shifted to sustainable packaging with introduction of boxes/ cartons, paper bags, pouches and large containers and avoiding single-use plastic.

 

There are also some regulations in place when it comes to quality and food safety. India has implemented strict regulations (like FFA norms focusing on interesterified fats) right from the quality of ingredients that go into making the baked product to the final selling at the store.

In a nutshell, the bakery industry is brimming with endless possibilities with creativity and innovation at its core and poised to stand the test of time in the coming years.

India is considering proposals to connect Bangladesh’s strategically important Matarbari port to northeastern states, according to people aware of the matter.

 

Bangladesh expects to boost exports once the country’s first deep sea port is built at Matarbari with assistance from Japan. The port will enhance exports to Southeast Asia, and other Asian markets, and improve its capability to handle cargo from international markets.

 

'The objective of the project is to strengthen the port’s cargo-handling capacity and to facilitate logistics operations with neighbouring countries. It will do so by constructing a multi-purpose deep-sea port for containers and general cargo in the Matarbari area of Cox’s Bazar, under Chattogram division, contributing to Bangladesh’s economic development,' said Japan International Cooperation Agency (JICA),which is helping finance the Matarbari project.

 

Earlier this year, JICA granted a $750 million loan to the Bangladesh government for the Matarbari development.

 

The port is set to start operations in 2027, easing the burden on crowded ports like Chittagong. In March, JICA extended an additional $400 million loan to boost road infrastructure between Chittagong Port and Cox’s Bazaar to improve road connectivity to the Matarbari port.

 

The Matarbari port is expected to enhance economic ties and open up development prospects for India’s northeastern states, including Tripura. The initiative follows plans by Japan, Bangladesh, and India to attract manufacturing to the Northeast and Bangladesh to establish a new industrial value chain in South Asia for exports to Indo-Pacific markets.

 

The people cited above said, India is actively exploring ways to enhance connectivity to Matarbari, either through a bilateral initiative or in partnership with Japan, which is engaged in major road connectivity projects in Bangladesh.

 

Queries mailed to the external affairs ministry, and Bangladesh high commission in New Delhi did not elicit any response till press time.

 

New Delhi is proactively advocating for enhanced connectivity with Bangladesh to boost bilateral trade and foster greater economic ties in South Asia.

 

Initiatives include the revival of cross-border railway projects, construction of energy pipelines, as well as sponsoring road projects in Bangladesh.

 

Additionally, India is also interested in the Bay of Bengal Northeast Industrial Value Chain concept championed by Japan, which will lead to increased infrastructure connectivity and synchronized trade policies among New Delhi, Dhaka, and Tokyo.

 

Besides, China’s growing footprint in Bangladesh has also been a major concern.

 

Beijing was initially interested in financing a deep sea port in Sonadia, in the south-eastern part of the country.

 

However, Sheikh Hasina’s government cancelled the plans in 2020, focusing on its ties with Japan to build a port at Matarbari.

 

News reports at the time indicated that New Delhi was opposed to the Sonadia port project.

 

India acknowledges that China will maintain a significant presence in its vicinity, and thereby the focus has shifted towards resolving disputes with neighbours and offering attractive connectivity and economic prospects to strengthen bilateral relations in the region.

India has exported 0.71 LMT of edible oil in the period of April to September in the current fiscal - 2023-24.

 

According to Ministry of Commerce, the value of the exported edible vegetable oil was 158.85 million USD.

 

However the import of vegetable oil witnessed a record high during the Apr-Sept period with 85.92 LMT import costing around 8508.76 million USD.

 

In the previous year, India imported 157.45 LMT of vegetable oil.

 

Meanwhile, the Government has told Parliament that to promote oilseed production, the Government annually announces Minimum Support Price (MSP) for 22 mandated agricultural crops including 07 oilseeds viz. Groundnut, Sunflower seed, Soybean, Sesamum, Nigerseed, Rapeseed & Mustard and Safflower.

 

The Ministry's statement reads that,  from 2018-19 onwards, the MSP has been announced at 1.5 times the cost of production to support the farmers and encourage production. Accordingly,

MSP for all crops including oilseeds is increased every year.

 

The Government was also working to augment the production area of these oilseeds through various interventions.

Cargo movement through inland waterways for the April-November period is up around 8 per cent at 86.47 million tonnes (mt), while the cargo handled across India’s major ports is up 6 per cent odd at 500.83 mt. 

 

In the same period last year, cargo movement via inland waterways was 80.44 mt, while cargo handled through the 12 major ports was 475 mt, data available with the Ministry of Ports, Shipping and Waterways (MoPSW) shows. 

 

During this period, ports handled 15,285 vessels, up 8 per cent on the 14,171 vessels handled last year. 

 

The major domestic ports include Kolkata Port, which includes both the Kolkata and Haldia docks, Paradip, Vizag, Kamarajar Port, Chennai, Tuticorin, Cochin, New Mangaluru, Mormugao, Mumbai port, Jawaharlal Nehru Port Trust, and Gujarat’s Kandla Port

 

Improving Efficiency

 

The major ports saw a substantial improvement across parameters. For instance, the turnaround time for vessels at Indian ports improved by 6 per cent to about 48.46 hours (just about 2 days), as compared to 55.61 hours in April-November of 2022.

 

Turnaround time in the maritime industry refers to the duration it takes for a vessel to complete a round trip, from one point to another and return to its original location. It represents the time required for a ship to unload its cargo, load new cargo, perform the necessary operations, and be ready for its next voyage.

 

Similarly, idling at berth (as a percentage of total time at the berth) fell to 16 per cent -- down nearly 24 per cent -- in the 8M of FY24, as compared to 21 per cent in the year-ago-period. Idling at berth refers to the time the vessel remains idle, as compared to the total time it spends. Lower idle time means quicker completion of cargo handling, and readiness. 

 

The output per ship, per berth stood at 18,457 tonnes, up 7.71 per cent in the 8M of FY24, as compared to 17,127 mt in the same period in the last fiscal. 

 

The pre-berthing detention time of vessels (the time a ship waits before getting entry/ access to a berth) improved by 60 per cent, with the pre-berthing time dropping to 6.15 hours, as against 15.05 hours last year. 

India, despite being one of the few developing countries self-sufficient in food, still shipped in $ 33 billion of farm products in 2023 with more than half of it just accounted for by vegetable oils, according to a report by trae policy think tank.

 

The imports in 2023 were 10% lower than last year’s $36.7 billion as vegetable oil prices eased during the year.

 

The imports of vegetable oil in 2023 is expected to be $17.1 billion, which is 18% lower than last year largely due to lower international prices. Pulses, another staple for which India is dependent on imports, accounted for $2.7 billion worth of imports in 2023 which was 44% more than last year, the report by Global Trade Research Initiative (GTRI) said.

 

Vegetable oil, Pulses, fresh and dry fruits account for 72.1% of Agriculture imports of India in CY2023.

 

'India needs to cut its reliance on imported vegetable oils to promote better health outcomes and also reduce the import bill. This will need educating consumers about the health benefits of using locally produced oils like mustard, groundnut, and rice bran in lieu of imported oils,' GTRI’s co-founder Ajay Srivastava said. High import duties and resisting pressure to open up are necessary to bolster domestic production and food security.

 

India is the world’s largest producer and consumer of pulses but more effort is needed to enhance domestic production and cut imports. This can be done by introducing high-yielding, disease-resistant pulse varieties. The key challenges include addressing water scarcity, and mitigating market volatility issues.

 

Major efforts extend to reclaiming fallow land, promoting intercropping, and focusing on rainfed areas. Also, the market and infrastructure support involve ensuring fair prices through Minimum Support Prices (MSP), investing in storage and processing, and establishing direct marketing channels.

 

Fresh and dry fruits imports are set to cross $ 4 billion in 2023. Major items of fresh fruit imports are apples ($ 350.7 million), Oranges ($ 90.9 million), Mandarins (Including Tangerines) ($ 14.8 million), Grapes ($ 22.1 million), Kiwi Fruit ($ 67.0 million), Pears ($ 26.9 million), Other Fruits, ($ 40.9 million). With dry fruits major items of import are cashew ($ 1.4 billion), almonds ($ 930 million), walnuts ($ 235 million), areca nuts ($ 130.2 million), dates ($ 210 million), dried figs ($ 127.2 million) and raisins ($ 75.7 million)

 

Cutting imports of fresh fruits will require addressing challenges faced by the Indian fresh fruit sector. These include the unavailability of high-quality seeds, resulting in lower yields. Inadequate storage and transportation facilities leads to substantial post-harvest losses. Also, the lack of strong branding hampers the industry’s competitiveness globally.

 

Spice imports in 2023 are expected to be $ 1.3 billion while sugar imports were $1.2 billion. India is the world’s largest sugar exporter after Brazil, but this year it will import sugar in vast quantities due to decline in domestic production caused by weak rains.

 

Major spices that are imported include pepper, cinnamon, cassia, clove, anise seeds, ginger, saffron and turmeric.

India decisively withstood global headwinds in 2023 and is likely to remain as the world's fastest-growing major economy on the back of growing demand, moderate inflation, stable interest rate regime and robust foreign exchange reserves. Despite widespread pessimism witnessed among the developed nations and the worsening geopolitical situation, India recorded a gross domestic product (GDP) expansion of 6.1 per cent in the March quarter. The growth moved up to 7.8 per cent in the June quarter and was 7.6 per cent in the September quarter.

 

For the first six months of this fiscal, the growth was 7.7 per cent.

 

The growth momentum is expected to sustain in the December quarter, making India the fastest-growing major economy in the world much ahead of China.

According to the latest growth projections of the Organization for Economic Cooperation and Development (OECD), which appear conservative, India will record a growth of 6.3 per cent in 2023, ahead of China and Brazil at 5.2 per cent and 3 per cent, respectively.

 

For 2024, the OECD expects India to grow at 6.1 per cent and China at 4.7 per cent.

 

On the other hand, major economies, including the US, UK and Japan, are likely to witness either deceleration or very nominal increase in economic growth rates in the coming year.

 

India's performance on the economic front in 2023 appears even better when viewed from a global perspective.

 

As per the International Monetary Fund's (IMF) World Economic Outlook, global growth is estimated to decelerate from 3.5 per cent in 2022 to 3 per cent in 2023 and further to 2.9 per cent in 2024.

 

Ashima Goyal, Member of the Reserve Bank of India's Monetary Policy Committee (MPC), said India's growth has 'shown great resilience despite many external shocks. This is due to increasing economic diversity and the role of policy in smoothing shocks'.

 

Equipping people with better skills and assets, she said, 'will add up to give India good growth in 2024 and beyond'.

 

Dharmakirti Joshi, Chief Economist at rating agency Crisil, said geopolitical developments will again test the resilience of India's domestic demand in the coming year.

 

'We expect the GDP to grow at 6.4 per cent in the coming fiscal year, a tad lower than the current one. The lagged impact of interest rate hikes and the global slowdown will be the key drags,' he noted.

 

A recent article on the state of the economy by the RBI said, 'Despite significant global headwinds, the Indian economy remained the fastest growing major economy in 2023. The outlook is one of cautious optimism as consumer confidence remains positive and perceptions about current income turned up in the RBI's latest survey of households in November 2023'.

 

RBI's dynamic Stochastic General Equilibrium (DSGE) model -- which is based on microeconomic foundations and rational expectations characterising the choices of agents, such as the representative consumer, producer and the central bank -- projects a growth rate of 6 per cent in the financial year 2024-25.

 

'After a couple of difficult years, the economic environment is turning more benign with inflation trending down and growth remaining robust. Most forecasts project that growth in 2024-25 would be close to but slightly lower than in 2023-24. The global slowdown and geopolitical uncertainty remain the biggest risks to growth,' MPC Member Jayanth R Varma said.

 

Retail inflation is on a downward trajectory after touching a peak of 7.44 per cent in July. This year began with retail inflation of 6.52 per cent in January, and it softened to 4.31 per cent in May before rising to 7.44 per cent in July.

 

In November, the retail inflation worked out to be 5.55 per cent, which was within RBI's comfort zone but some distance away from the mean rate of 4 per cent.

 

Aditi Nayar, Chief Economist at rating agency Icra, said inflation is likely to moderate, although a well-distributed monsoon will be crucial for quelling food inflation.

 

India's macros appear to be in a good place heading into 2024. The growth is expected at 6.5 per cent in FY2024 and 6.2 per cent in FY2025, she added.

 

As per the central bank's DSGE model, the retail inflation during the financial year 2024-25 is projected to decline to 4.8 per cent from 4.9 per cent estimated for the current fiscal.

 

Following the policy of remaining 'actively disinflationary', the RBI has kept the short-term interest rate or repo rate unchanged at 6.5 per cent since February.

 

RBI Governor Shaktikanta Das ended the rate hike cycle, which began in May 2022, by opting for the status quo in policy rate from April 2023. The stable interest rate regime has yielded good dividends and strengthened the twin balance sheets of banks and corporates.

 

It is likely that the Reserve Bank may go in for a rate cut during the course of 2024 if the retail inflation remains within the specified band of 2 to 6 per cent and the price of crude oil does not show any unexpected spike driven by geopolitical factors, including Russia-Ukraine war, Israel-Gaza conflict and blockade of Red Sea route.

 

'Overall, the forces are likely to balance out in calendar year 2024, giving us a comfortable growth rate in the range of 6.3 per cent to 6.6 per cent. The joker in the pack is geopolitics and conflict hotspots - the worsening or easing of the current conflicts will determine the landing bias of the growth rate to the lower or higher end, respectively,' opined Ranen Banerjee, Partner, Economic Advisory Services, PwC India.

 

The comforting factor for India in the midst of a worsening geopolitical climate and global economic slowdown is the foreign exchange reserves, which crossed the USD 600 billion mark in December after a gap of about four months.

 

Also on the external front, the current account deficit showed remarkable improvement, and it narrowed sharply to 1 per cent of GDP in the September 2023 quarter against 3.8 per cent in the year-ago period.

 

Pulses imports are seen rebounding to a six-year high in the current financial year on shortfall in domestic output following deficit rainfall in growing areas. Trade estimates that pulses imports are likely to touch 3 million tonnes(mt) during the current financial year, an increase of around 31 per cent over last year’s 2.29 mt.

 

The shortfall in domestic output due to weather vagaries led to prices spiralling in recent months. The government, besides opening up imports of yellow peas till March 31, 2024, has extended the window for duty-free imports of pulses such as lentils (masur), tur (pigeon pea) and urad (black matpe) till March 2025, to boost the supplies and keep prices under check.

 

Lentils tops 1 mt?

'Chana output was good last year, while the moong bean production was not that encouraging this kharif as it was affected due to the dry spell in Rajasthan. We are still dependent on imports for the pulses varieties such as tur, urad and lentils. We will end up importing almost 3 mt of pulses this financial year' said Bimal Kothari, chairman, India Pulses and Grains Association (IPGA).

 

As per the DGCIS data, India has already imported over 1.96 mt of pulses during the April-October period of the current financial year, valued at over Rs.14,057 crore ($1.69 billion). Of this, the imports of lentils is reported to have crossed a million tonnes.

 

India had imported a record 6.5 million tonnes of pulses during 2017-18, when yellow peas were imported in large quantities. Imports declined in the subsequent years after restrictions were placed on varieties such as yellow peas, chick peas and moong.

 

Sowing down

As of December 29, the pulses acreages in the current rabi season was down at 142.49 lakh hectares (lh) over 153.22 lh a year ago. This was mainly on account of a dip in chana acreage at 97.05 lh over 105.80 lh a year ago. However, the area under lentils has seen a marginal increase at 18.68 lh (18.02 lh).

 

The trade expects chana output to be lower by 10-15 per cent on account of a drop in acreage, while the production of lentils is likely to increase with favourable weather in the key producing States of Madhya Pradesh and Uttar Pradesh.