Categoría: Economy and Business

As two emerging global powers, India and China’s progress should be mutually supportive, Indian Ambassador to China Ashok K Kantha has said.

During a visit to the state-run China Daily yesterday, Mr Kantha talked about the growth of India-China relations, especially in the context of a closer developmental partnership agreed between the two sides, a statement issued by the Indian Embassy in Beijing said.

«As two major poles in the emerging global architecture, our progress should be mutually supportive,» he said.

The Indian Ambassador said that in order to realise the full momentum of the growth of the bilateral relations, expanded engagement between business and think tanks, media is important.

Source: http://www.ndtv.com/india-news/progress-of-india-china-should-be-mutually-supportive-envoy-1208898

Less than four months ago, on April 14 in Berlin, Prime Minister Narendra Modi had made a plea in favour of resuming the final stages of negotiations for wrapping up a free trade agreement between India and the European Union, one that has been hanging fire for the last eight years. Then, just ahead of an impending August 28 meeting of the chief negotiators of India and the EU for resuming talks on the Broad-based Trade and Investment Agreement (BTIA) after a two-year hiatus, the commerce ministry, on August 5, decided to make an abrupt announcement citing the Indian government’s decision to defer the proposed talks in protest against the EU imposing a legally binding ban on the sale of around 700 generic drugs clinically tested by GVK Biosciences, Hyderabad. This was in reaction to the EU having imposed the ban citing the alleged manipulation of clinical trials by drug research company GVK Biosciences.

The legality of the EU action against GVK Biosciences aside, India’s latest attempt to delay the BITA talks is broadly consistent with the typical dilly-dallying stance adopted by the country during world trade negotiations, with nationalism, almost always, being used as the alibi for the protectionist stance. The sense of urgency to clinch the deal displayed by the Prime Minister in the April joint press conference with German Chancellor Angela Merkel appears to have been backed by a measure of rational thinking, especially in the wake of the fact that just a month ahead of Modi’s trip to Germany, the government had steamrolled a major sticking point in the trade pact negotiations by operationalising increased FDI limit of up to 49 per cent in the insurance sector.

Source: http://indianexpress.com/article/india/india-others/india-eu-trade-pact-antibiotic-for-common-cold/

The current economic relationship between India and ASEAN countries presents a multitude of industrial, commercial, and investment opportunities.  India has welcomed ASEAN’s plans to establish economic and political relationships with neighboring nations, and India and ASEAN have increasingly supported bilateral trade, promoted foreign investment, and strengthened diplomatic relations.

Bilateral trade between India and ASEAN totaled US$80 billion in 2014, up ten billion from 2012 and increasing by an average annual rate of 23 percent over the past decade. A large portion of India and ASEAN’s surging economic and political relationship can be accredited to two things: India’s “Act East” policy, which reaffirmed India’s plans to engage more substantially with the economies of its Southeast Asian neighbors; and rising business optimism within ASEAN, as outlined in the latest ASEAN Business Optimism Index by Dun & Bradstreet.

Singapore

Singapore is India’s strongest connection to the ASEAN market, accounting for 25.9 percent of all of India’s trade with ASEAN from 2013-2014. The city state has also benefited economically from its tight relationship with India, from which it imported USD 7.1 billion in 2014.

In addition to a healthy trade relationship, Singapore and India also enjoy a diplomatic political history of over 50 years. In 2014, Singapore and India again strengthened defense partnerships and recommitted to the practice of joint military training exercises.

As India’s portal to the rest of ASEAN, Singapore is likely to enjoy a mutually beneficial economic and political relationship with India for multiple upcoming decades.

Vietnam
Vietnam and India have also sought to strengthen their economic and political standing. Vietnam’s 2014 renewal of Indian oil blocks in the South China Sea is indicative of improved diplomatic and defense relations between the two nations.

The economies of India and Vietnam are anticipated to increasingly rely on one another for trade in the upcoming years. From 2013-2014, bilateral trade between Vietnam and India totaled USD 8.03 billion, and both countries’ governments predict this number to reach US$15 billion by 2020. In terms of exports from Vietnam to India, large investment opportunities exist in the textile and pharmaceutical industries.

Indonesia
India and Indonesia’s economic relationship has grown exponentially in recent years. After signing a double taxation agreement (DTA) in 2012, bilateral trade between the two countries totaled US$20 billion. In 2012, the Indian embassy in Jakarta launched the India Business Forum, in which Indian business owners committed to further interaction with the Indonesian market.

In 2014, Indonesia accounted for 38 percent of ASEAN’s total GDP. By increasing trade with Indonesia, India will gain significantly greater access to the Southeast Asian economy. At the same time, India’s population of over 1.27 billion presents a large market for the ASEAN countries’ primary exports of oils, gas, and electronic equipment.

Room for Growth
It remains to be seen how the ASEAN region will respond to India’s recent initiatives to improve economic and political relations. Although the last several years have seen considerable development in India-ASEAN relations, there is further room in these markets for significant growth in the coming years.

 

Source: http://www.india-briefing.com/news/theact-east-policy-business-optimism-asean-india-southeast-asia-deepen-bilateral-relations-11101.html/

Indian Prime Minister Narendra Modi has agreed to drop politically unpopular clauses from a pro-business land bill, a move that will fuel worries among investors that the slow pace of economic reforms is hurting long-term growth prospects.

Tussles over land acquisition have locked up hundreds of billions of dollars of infrastructure developments. The bill was meant to make it easier to acquire land and help realize Modi’s vision of building modern cities and industrial corridors.

But opposition parties have successfully portrayed the proposed changes, including exemption from getting consent of 80 percent of landowners for some projects, as anti-farmer. That is a damaging charge in a country that is still mostly rural.

Moody’s and Fitch unit BMI Research warned last week that delays in promised reform were affecting investor sentiment and the economic outlook.

In December, Modi issued a temporary executive order that allowed the government to forcibly buy farmland for industrial development. He reissued the order twice, and each time it lapsed without parliamentary approval.

After failing to garner wider support for the measure, lawmakers of the ruling Bharatiya Janata Party (BJP) said they would not press ahead with the contentious clauses of the bill.

«You may call it a U-turn, or a political course correction, but we have decided to accept the consent clause because it will protect the farmer’s right over his land,» said a senior member of the BJP.

The retreat is another blow to Modi’s ambitious economic reform agenda that has been stalled by a logjam in parliament.

The discord in parliament has almost ruled out the passage of landmark tax reform in the current session of parliament, which ends on Aug. 13.

In a note last week, BMI Research said the slowing pace of reforms has made Indian shares «precarious» and a deeper correction appears in the offing.

The NSE index is up nearly 3 percent this year compared with a 31 percent gain in 2014.

The land bill was expected to be a catalyst to speed up economic growth as lengthy delays in acquiring land have made firms wary of committing fresh investments.

With the BJP facing a tough election in Bihar, which is among the poorest states in the country and has predominantly an agrarian economy, championing the proposed reforms could have cost crucial votes.

«We hope the opposition and farmer groups now accept the bill with the latest amendments and finally approve it,» said another senior BJP politician.

Source: http://www.reuters.com/article/2015/08/04/us-india-reform-land-idUSKCN0Q91C520150804

Prakash Steelage today said the Spanish stainless steel maker Tubacex completed acquisition of a majority 67.5 per cent stake in its seamless stainless steel tube division for over Rs 209 crore.

In a BSE filing, the Mumbai-based firm said after signing the Joint Venture Agreement (JVA) on February 13, 2015, the firm transferred its seamless stainless steel tubes and pipes business to the Tubacex Prakash India Pvt Ltd (JV company) in accordance with provisions of the Business Transfer Agreement on July 25, 2015 entered into between the firm and JV company.

The JVA was signed between Prakash Steelage and Tubacex S.A. Spain, it added.

«Pursuant to the transfer of business as per the JVA, the company has received a consideration of Rs 209.16 crore, a major part of which is being utilised to repay the bank debts,» it said.

The JV firm has issued equity shares to Tubacex S.A and the company.

«Post closing of the JVA. The company now holds 32.47 per cent of the equity shares and the balance shareholding of 67.53 per cent is held by Tubacex S.A. Consequently, the JV company is no longer a subsidiary of the company,» Prakash Steelage said in the filing.

Prakash Steelage will continue to own and operate all its other businesses, including manufacturing of stainless steel welded tubes and pipes and trading business, it added.

Shares of Prakash Steelage today closed flat at Rs 120.10 per share at the BSE.

Source: http://www.business-standard.com/article/pti-stories/tubacex-acquires-majority-of-prakash-steelage-s-tube-division-115072701386_1.html