Looks to me after reading the reviews that the Indian economy is really set to be rising. There might be few hiccups occasionally but that wont be a big hurdle in its progress I think. One can assume that clearly by analysing the stock market trends over the last decade. The way it has got a head start is something unseen in other places I suppose.
Indian Economy - News & Updates - Archive
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India taxes up from estimates
NEW DELHI: Indiaâs indirect tax collections including customs and excise during the financial year ended March were Rs2.40 trillion ($5.90 billion), two per cent higher than earlier estimates, the finance ministry said on Saturday. The government had earlier estimated indirect tax revenues at Rs2.36 trillion.
A finance ministry statement said direct tax collections including income tax stood at Rs2.29 trillion during the period, marginally up from earlier estimates. âFor the first time in recent years, the actual collections have exceeded budgeted and revised estimates,â Finance Minister Palaniappan Chidambaram told reporters. He said the higher figures were achieved mainly through better tax compliance, administration and higher GDP growth. Indiaâs GDP grew by an estimated 9.2 per cent in the financial year 2007.
http://www.thenews.com.pk/daily_detail.asp?id=53435
NEW DELHI: Indiaâs indirect tax collections including customs and excise during the financial year ended March were Rs2.40 trillion ($5.90 billion), two per cent higher than earlier estimates, the finance ministry said on Saturday. The government had earlier estimated indirect tax revenues at Rs2.36 trillion.
A finance ministry statement said direct tax collections including income tax stood at Rs2.29 trillion during the period, marginally up from earlier estimates. âFor the first time in recent years, the actual collections have exceeded budgeted and revised estimates,â Finance Minister Palaniappan Chidambaram told reporters. He said the higher figures were achieved mainly through better tax compliance, administration and higher GDP growth. Indiaâs GDP grew by an estimated 9.2 per cent in the financial year 2007.
http://www.thenews.com.pk/daily_detail.asp?id=53435
Saturday, April 28, 2007
Asian telecom firms plan to build $500m Asia-US cable
PUTRAJAYA, Malaysia: Asian phone companies unveiled plans on Friday to build a $500 million undersea cable between Southeast Asia and the United States to speed up Internet connections in the region.
Existing telecoms cables connecting Asia and North America are nearing full capacity while some of the oldest will need to be retired soon, Malaysiaâs communications minister said in announcing the project, to be led by Telekom Malaysia
The 20,000-kilometre (12,400-mile), fibre-optic cable system would also take a different route from many existing cables to avoid quake-prone areas and a repeat of the disruption to Asian Web access caused by a tremor off Taiwan four months ago.
âThe low-risk route was designed to avoid the volatile and hazardous Pacific ring,â Communications Minister Lim Keng Yaik said, referring to the ring of sub-sea volcanoes and quake zones around the Pacific Ocean.
Telekom Malaysia said cable construction would begin immediately and that, when completed, it would directly link seven Asian countries Malaysia, Singapore, Thailand, Brunei, Vietnam, the Philippines and Hong Kong with the United States.
The cable network would begin carrying commercial traffic by December 2008.
âThe undersea cable will provide a timely increase in both the capacity and diversity of Internet links between Asia and the US, bearing in mind the disruption caused by the recent Taiwan earthquake late last year,â Telekom Chief Executive Abdul Wahid Omar said in a statement.
âWhen it begins operations, Internet users can look forward to faster and more reliable international connectivity.â
The cable consortium comprises 17 firms, mostly from Asia.
They include AT&T Inc, Indiaâs Bharti Airtel, British Telecom Global Network Services, Thailandâs CAT Telecom, Indonesiaâs Indosat, Philippines Long Distance Telephone Co, Singaporeâs StarHub, Australiaâs Telstra , Telecom New Zealand and the Vietnam Post & Telecommunications Group.
The consortium had awarded the cable construction contract to Alcatel Submarine Network, a unit of Franceâs Alcatel-Lucent, and to Japanâs NEC Corp. reuters
http://www.dailytimes.com.pk/default.asp?page=2007\04\28\story_28-4-2007_pg5_27
Asian telecom firms plan to build $500m Asia-US cable
PUTRAJAYA, Malaysia: Asian phone companies unveiled plans on Friday to build a $500 million undersea cable between Southeast Asia and the United States to speed up Internet connections in the region.
Existing telecoms cables connecting Asia and North America are nearing full capacity while some of the oldest will need to be retired soon, Malaysiaâs communications minister said in announcing the project, to be led by Telekom Malaysia
The 20,000-kilometre (12,400-mile), fibre-optic cable system would also take a different route from many existing cables to avoid quake-prone areas and a repeat of the disruption to Asian Web access caused by a tremor off Taiwan four months ago.
âThe low-risk route was designed to avoid the volatile and hazardous Pacific ring,â Communications Minister Lim Keng Yaik said, referring to the ring of sub-sea volcanoes and quake zones around the Pacific Ocean.
Telekom Malaysia said cable construction would begin immediately and that, when completed, it would directly link seven Asian countries Malaysia, Singapore, Thailand, Brunei, Vietnam, the Philippines and Hong Kong with the United States.
The cable network would begin carrying commercial traffic by December 2008.
âThe undersea cable will provide a timely increase in both the capacity and diversity of Internet links between Asia and the US, bearing in mind the disruption caused by the recent Taiwan earthquake late last year,â Telekom Chief Executive Abdul Wahid Omar said in a statement.
âWhen it begins operations, Internet users can look forward to faster and more reliable international connectivity.â
The cable consortium comprises 17 firms, mostly from Asia.
They include AT&T Inc, Indiaâs Bharti Airtel, British Telecom Global Network Services, Thailandâs CAT Telecom, Indonesiaâs Indosat, Philippines Long Distance Telephone Co, Singaporeâs StarHub, Australiaâs Telstra , Telecom New Zealand and the Vietnam Post & Telecommunications Group.
The consortium had awarded the cable construction contract to Alcatel Submarine Network, a unit of Franceâs Alcatel-Lucent, and to Japanâs NEC Corp. reuters
http://www.dailytimes.com.pk/default.asp?page=2007\04\28\story_28-4-2007_pg5_27
Auto czars make a beeline for India
By Anand Kumar
THE last few weeks have seen top honchos of the worldâs leading automobile manufacturers make a beeline for India, either to inaugurate new plants, or to expand their existing production capacities in the country.
The high-profile auto czars who visited India included G. Richard Wagoner Jr, chief executive of General Motors, Carlos Ghosn, the chief executive of Renault-Nissan, Luca Cordero di Montezemolo, the Fiat chairman, and Norbert Reithofer, chairman, BMW AG.
Most of the global auto majors have also unveiled ambitious investments in India in recent months. According to auto industry analysts, these investments â announced by GM, Fiat, Volkswagen, Honda, Nissan and Hyundai â add up to over $1.5 billion in Greenfield projects. Brownfield projects add up to several hundred million more dollars, as all the leading players, including Toyota, Suzuki, Tata Motors, and Honda, plan to expand their facilities. Mitsubishi and Nissan also plan to invest in new facilities in the country.
And why are all the auto majors setting up manufacturing plants in India? The global auto industry is undergoing a major transformation. According to Wagoner, Asia is emerging as the prime driver for automobiles; in about 10 years, the continent would account for 70 per cent of global auto sales.
China and India will not only be the two biggest markets in Asia, but also major production hubs. Automobile giants from the US and Japan hope to export large volumes of cars from India over the coming years.
Santosh Mohan Dev, Indiaâs heavy industries minister, estimates that total auto sales in the country will jump from under $35 billion at present to over $145 billion in under a decade. India is also emerging as a leading auto component producing nation â the sector is likely to balloon from around $12 billion at present to about $40 billion in seven years.
Wagoner said GMâs off-take of auto components from India alone will add up to about $1 billion within five years. All the leading international auto parts manufacturers are also eyeing India as a significant source for supplies and are making arrangements with local partners here.
The relatively low wages in India â a fraction of the costs in Detroit or even in the southern parts of the United States â the burgeoning demand for automobiles, and the steady decline in the western markets are forcing American, European, Japanese and Korean auto firms to set up production facilities in India.
The Indian government is also encouraging international manufacturers to set up plants in the country. Tax laws have been reformed, and the excise duty on small cars today is down to 16 per cent. Car sales are accelerating at about 15 per cent annually, and are expected to grow at a brisk clip for the next five years.
The entry of the sub-one-lakh car by Tata Motors in the next two years will boost demand for small cars even further. The auto sector is expected to account for 10 per cent of the countryâs gross domestic product (GDP) in about 10 years.
Cities like Pune, Delhi, Chennai and Nashik are emerging as major automobile production centres, with a comprehensive network of auto component makers and suppliers as well. Indian universities are also churning out huge numbers of engineers every year, needed to run these workshops.
GM, which is putting up a new plant near Pune in Maharashtra, is doubling its production to nearly a quarter million cars a year in India. Three other manufacturers, including Japanâs Suzuki (which controls Maruti), Koreaâs Hyundai, and Indiaâs Tata Motors also produce nearly a quarter million cars each year.
By next year India will be producing almost three million automobiles every year, as against 10 million by China. At the turn of the century, India was producing 632,000 passenger cars a year and China about 600,000. The last seven years have, however, seen Chinaâs automotive sector expand phenomenally.
The head honchos of global auto giants are now visiting India to see if a similar story will unfold here over the next few years. Ghosn of Renault âNissan inaugurated a new factory recently together with Anand Mahindra of Mahindra & Mahindra at Nashik, where its Logan will roll out. The car costs almost $10,000, but Ghosn was hopeful that the European firm will be able to launch smaller cars costing a third of that price.
Automakers are hoping to lure the millions of two-wheeler riders in India, which could transform the auto business. An average motor-cycle costs about Rs50,000, but if Tata Motors succeeds in producing a car costing Rs100,000, it would dent the two-wheeler business, and millions of Indians would upgrade into the four-wheeler segment.
GM, which has traditionally been selling mid-size cars in India, has also launched its small car, the Chevy Spark, in India, with a price tag of around $7,500. The Spark is expected to take on small cars made by Maruti and Hyundai.
BMWâs Reithofer inaugurated the German luxury carmakerâs plant near Chennai in the southern state of Tamil Nadu. Unlike the other auto majors, BMW will be producing less than 2,000 cars a year; its vehicles, priced between Rs2.5 million and Rs4.5 million, are aimed at the upper-end of the market.
According to Reithofer, demand for luxury cars in India is expected to double in the near future, and BMW was positioning itself to take advantage of the growing demand.
INTERNATIONAL automobile manufacturers are also looking at India as a potential export hub for their vehicles, especially small cars. Suzuki-controlled Maruti is already exporting over 50,000 cars a years, and plans to raise this to 400,000 shortly.
The company is putting up a new factory near Delhi, to produce its sub-compact, the Swift. With several such ambitious expansion and export plans, the auto industry is worried as to whether Indian ports would be able to handle the increased demand.
Many of the auto giants are now scouring around for dedicated car terminals, which could handle huge volumes involving hundreds of thousands of cars. At present, Mumbai and Chennai ports are equipped to handle auto exports, but both the ageing ports are inefficient and would be unable to meet the future requirements.
Automobile manufacturers are now toying with the idea of setting up dedicated port facilities in other areas to ensure smooth movement of their vehicles destined for international markets. Maruti is likely to join hands with Nissan to set up such a facility in Gujarat, to handle nearly half a million cars a year.
Automobile factories located in the Delhi-Haryana region are keen on setting up terminals along the Gujarat coast, as it is the closest for them. Gujarat also has a few major private ports, established recently, and with better infrastructure than Indiaâs major ports such as Mumbai and Chennai.
The government of India is also planning a dedicated freight corridor between Delhi and Mumbai, which would help speed up movement of vehicles to the Gujarat ports. Manufacturers like Ford and Hyundai have their plants near Chennai, and are looking at options for dedicated export terminals.
Domestic giants like Tata Motors and Mahindra & Mahindra are also aggressively looking at the overseas markets, especially in Asia, the Middle East, Africa, Latin America and Europe. Both have been successfully exporting their products to these markets in recent years.
Tata Motors recently launched its mini-truck, the Ace, in Nepal. The company has sold nearly 100,000 mini-trucks in India and Sri Lanka.
http://www.dawn.com/2007/04/30/ebr10.htm
By Anand Kumar
THE last few weeks have seen top honchos of the worldâs leading automobile manufacturers make a beeline for India, either to inaugurate new plants, or to expand their existing production capacities in the country.
The high-profile auto czars who visited India included G. Richard Wagoner Jr, chief executive of General Motors, Carlos Ghosn, the chief executive of Renault-Nissan, Luca Cordero di Montezemolo, the Fiat chairman, and Norbert Reithofer, chairman, BMW AG.
Most of the global auto majors have also unveiled ambitious investments in India in recent months. According to auto industry analysts, these investments â announced by GM, Fiat, Volkswagen, Honda, Nissan and Hyundai â add up to over $1.5 billion in Greenfield projects. Brownfield projects add up to several hundred million more dollars, as all the leading players, including Toyota, Suzuki, Tata Motors, and Honda, plan to expand their facilities. Mitsubishi and Nissan also plan to invest in new facilities in the country.
And why are all the auto majors setting up manufacturing plants in India? The global auto industry is undergoing a major transformation. According to Wagoner, Asia is emerging as the prime driver for automobiles; in about 10 years, the continent would account for 70 per cent of global auto sales.
China and India will not only be the two biggest markets in Asia, but also major production hubs. Automobile giants from the US and Japan hope to export large volumes of cars from India over the coming years.
Santosh Mohan Dev, Indiaâs heavy industries minister, estimates that total auto sales in the country will jump from under $35 billion at present to over $145 billion in under a decade. India is also emerging as a leading auto component producing nation â the sector is likely to balloon from around $12 billion at present to about $40 billion in seven years.
Wagoner said GMâs off-take of auto components from India alone will add up to about $1 billion within five years. All the leading international auto parts manufacturers are also eyeing India as a significant source for supplies and are making arrangements with local partners here.
The relatively low wages in India â a fraction of the costs in Detroit or even in the southern parts of the United States â the burgeoning demand for automobiles, and the steady decline in the western markets are forcing American, European, Japanese and Korean auto firms to set up production facilities in India.
The Indian government is also encouraging international manufacturers to set up plants in the country. Tax laws have been reformed, and the excise duty on small cars today is down to 16 per cent. Car sales are accelerating at about 15 per cent annually, and are expected to grow at a brisk clip for the next five years.
The entry of the sub-one-lakh car by Tata Motors in the next two years will boost demand for small cars even further. The auto sector is expected to account for 10 per cent of the countryâs gross domestic product (GDP) in about 10 years.
Cities like Pune, Delhi, Chennai and Nashik are emerging as major automobile production centres, with a comprehensive network of auto component makers and suppliers as well. Indian universities are also churning out huge numbers of engineers every year, needed to run these workshops.
GM, which is putting up a new plant near Pune in Maharashtra, is doubling its production to nearly a quarter million cars a year in India. Three other manufacturers, including Japanâs Suzuki (which controls Maruti), Koreaâs Hyundai, and Indiaâs Tata Motors also produce nearly a quarter million cars each year.
By next year India will be producing almost three million automobiles every year, as against 10 million by China. At the turn of the century, India was producing 632,000 passenger cars a year and China about 600,000. The last seven years have, however, seen Chinaâs automotive sector expand phenomenally.
The head honchos of global auto giants are now visiting India to see if a similar story will unfold here over the next few years. Ghosn of Renault âNissan inaugurated a new factory recently together with Anand Mahindra of Mahindra & Mahindra at Nashik, where its Logan will roll out. The car costs almost $10,000, but Ghosn was hopeful that the European firm will be able to launch smaller cars costing a third of that price.
Automakers are hoping to lure the millions of two-wheeler riders in India, which could transform the auto business. An average motor-cycle costs about Rs50,000, but if Tata Motors succeeds in producing a car costing Rs100,000, it would dent the two-wheeler business, and millions of Indians would upgrade into the four-wheeler segment.
GM, which has traditionally been selling mid-size cars in India, has also launched its small car, the Chevy Spark, in India, with a price tag of around $7,500. The Spark is expected to take on small cars made by Maruti and Hyundai.
BMWâs Reithofer inaugurated the German luxury carmakerâs plant near Chennai in the southern state of Tamil Nadu. Unlike the other auto majors, BMW will be producing less than 2,000 cars a year; its vehicles, priced between Rs2.5 million and Rs4.5 million, are aimed at the upper-end of the market.
According to Reithofer, demand for luxury cars in India is expected to double in the near future, and BMW was positioning itself to take advantage of the growing demand.
INTERNATIONAL automobile manufacturers are also looking at India as a potential export hub for their vehicles, especially small cars. Suzuki-controlled Maruti is already exporting over 50,000 cars a years, and plans to raise this to 400,000 shortly.
The company is putting up a new factory near Delhi, to produce its sub-compact, the Swift. With several such ambitious expansion and export plans, the auto industry is worried as to whether Indian ports would be able to handle the increased demand.
Many of the auto giants are now scouring around for dedicated car terminals, which could handle huge volumes involving hundreds of thousands of cars. At present, Mumbai and Chennai ports are equipped to handle auto exports, but both the ageing ports are inefficient and would be unable to meet the future requirements.
Automobile manufacturers are now toying with the idea of setting up dedicated port facilities in other areas to ensure smooth movement of their vehicles destined for international markets. Maruti is likely to join hands with Nissan to set up such a facility in Gujarat, to handle nearly half a million cars a year.
Automobile factories located in the Delhi-Haryana region are keen on setting up terminals along the Gujarat coast, as it is the closest for them. Gujarat also has a few major private ports, established recently, and with better infrastructure than Indiaâs major ports such as Mumbai and Chennai.
The government of India is also planning a dedicated freight corridor between Delhi and Mumbai, which would help speed up movement of vehicles to the Gujarat ports. Manufacturers like Ford and Hyundai have their plants near Chennai, and are looking at options for dedicated export terminals.
Domestic giants like Tata Motors and Mahindra & Mahindra are also aggressively looking at the overseas markets, especially in Asia, the Middle East, Africa, Latin America and Europe. Both have been successfully exporting their products to these markets in recent years.
Tata Motors recently launched its mini-truck, the Ace, in Nepal. The company has sold nearly 100,000 mini-trucks in India and Sri Lanka.
http://www.dawn.com/2007/04/30/ebr10.htm
April 30, 2007
Softening of Indian trade barriers
By Parvaiz Ishfaq Rana
India has been denying that she is using non-tariff barriers (NTBs) to curb imports from Pakistan. But a small quantity of 5000 tons cement exported from Pakistan was briefly detained at Nhava Shava port near Mumbai, by the Indian authorities apparently for want of a `quality and standard certificationâ from the Indian Bureau of Standards (IBS).
The threat by Pakistani exporters to divert the cargo to Dubai port finally persuaded the Indians to send IBS officials to the port for piecemeal clearance of the cargo..
Presently, India is facing acute shortage of wheat and cement while Pakistan is well placed to meet the shortfall in both of these commodities. If India does not use NTBs to discourage imports of these two commodities from Pakistan it could help narrow the persistent and widening trade gap in her favour. Last year, the two-way trade stood at $1.3 billion but exports from Pakistan accounted for only for twenty per cent of the overall volume.
Indiaâs current needs are estimated at around three million tons of wheat. And the Indian government has recently removed duties to facilitate imports to meet domestic demand. On the other
hand, Pakistan is expecting a bumper wheat crop of around 23- 24 million tons and after meeting domestic consumption of around 20 million tons, it would be left with a huge exportable surplus of over four million tons . It has also sizeable carry-over stocks from last season.
Similarly, there is a surplus cement production of around six million tons out of the total production of around 30 million tons per annum. Presently 19 cement units are operating and by June this year, another three million tons of cement capacity is expected to be added. Around 22 million tons of cement is consumed in the local market while around two million tons are being annually exported to Afghanistan.
The question however is: have the policy makers made any plan to take full advantage of huge surpluses in these bulk commodities to earn much needed foreign exchange to reduce the yawning trade deficit:? And has the Trade Development Authority of Pakistan (TDAP) been assigned with the task of facilitating exports of these two commodities?
Exporters and manufacturers of these two commodities are tapping foreign as well as Indian markets but without any governmental support and guidance. Some exporters have also shipped around 5000 tons of wheat to India on trial basis. Though the shipment has not yet reached Indian ports, exporters suspect that it may be rejected on some flimsy grounds including higher contents of foreign matter (edible and non-edible). Pakistani wheat normally has one to 1.5 per cent contents of foreign elements but is free from Kernel Bunt disease which is globally considered to be an Indian infection.
. The Indian intiial move to detain Pakistani cement is against Article-8 of South Asia Free Trade Agreement (Safta) under which the contracting Saarc members are bound to provide trade facilitation for mutual trade. A pertinent clause of this article is: âharmonisation of standards, reciprocal recognition of tests and accreditation of testing laboratories of contracting states and certification of products.â
In case, stipulated measures under Safta are not adopted by the Saarc states, there are other options available and which are also in vogue worldwide to facilitate trade between both countries. For ensuring quality and standards, pre-shipment inspection companies are operating and they could also be used by India for imports from Pakistan.
A US study has also given critical appraisal over Indian technical barriers to trade (mandatory standards) and stated that India has enforced mandatory certification for 109 products, down from over 150 products some time back. The mandatory quality certification covers a wide range of products e.g. various food items, food colours, cements etc. Imports of these items are allowed only after Bureau of Indian Standards (BIS) certification and permission to use the BIS mark.
The study further discloses that for certification of these 109 items detailed requirements have been issued under seven different Acts. It is a general complaint that the Indian government publishes Tariff, Additional Tax Rates and Notifications but there is no single official publication that covers all information on tariffs, fees and tax rates as well as the legislations under which formalities are to be completed.
All these are given in different Acts and all Acts have detailed Rules. Most of the requirements emanate from these Rules. This makes the whole system very cumbersome, time-consuming and even confusing. . Hence, there is a total lack of transparency. The standards specified are in many cases stricter than the international standards.
During a recent visit of a 10-member delegation from PHD Chamber of Commerce and Industry (oldest chamber of India) ,its President Mr Bhatia disclosed that there is also a demand of around three million tons of wheat in India. In a meeting with FPCCI the Indian delegation was informed about huge trade imbalance between the two countries and the NTBs issue also came under discussion. An executive member of Saarc Chamber of Commerce, Amjad Rafi told the delegation that time has come that India should remove NTBs and let Pakistani cement and wheat find its way in Indian market to improve bilateral trade imbalance..
But Indian diplomats always respond to Pakistanâs criticism of NTB by raising the issue of Pakistan not giving India Most Favoured Nation (MFN) status despite the worsening adverse trade imbalance against Pakistan. During a recent conference of Saarc chamber on Safta held in Bhurban, the Indian diplomat raised the issue of MFN status and was critical of Pakistan for not implementing SAFTA in letter and spirit.
But Pakistan gives the same treatment to Indian goods as to imports from any other country. All Indian goods at the entry points are treated at par with other imports originating from around the globe. And items in the positive list of 1078 items are allowed to be imported from India without any hurdles or technical barriers.
As a matter of fact, Indian goods not allowed for import reach Pakistani markets through third countries and according to private estimates, the volume of this informal trade is to the tune of $2 billion. During first three months (Jan to March), the official trade volume between both the countries reached $500 million mark and if the momentum is maintained for rest of the year, it would mean that the total trade could touch $2 billion by the end of 2007. But how long can Pakistan sustain widening imbalances in trade with its big neighbour protecting its huge market with non- tariff barriers?
http://www.dawn.com/2007/04/30/ebr16.htm
Softening of Indian trade barriers
By Parvaiz Ishfaq Rana
India has been denying that she is using non-tariff barriers (NTBs) to curb imports from Pakistan. But a small quantity of 5000 tons cement exported from Pakistan was briefly detained at Nhava Shava port near Mumbai, by the Indian authorities apparently for want of a `quality and standard certificationâ from the Indian Bureau of Standards (IBS).
The threat by Pakistani exporters to divert the cargo to Dubai port finally persuaded the Indians to send IBS officials to the port for piecemeal clearance of the cargo..
Presently, India is facing acute shortage of wheat and cement while Pakistan is well placed to meet the shortfall in both of these commodities. If India does not use NTBs to discourage imports of these two commodities from Pakistan it could help narrow the persistent and widening trade gap in her favour. Last year, the two-way trade stood at $1.3 billion but exports from Pakistan accounted for only for twenty per cent of the overall volume.
Indiaâs current needs are estimated at around three million tons of wheat. And the Indian government has recently removed duties to facilitate imports to meet domestic demand. On the other
hand, Pakistan is expecting a bumper wheat crop of around 23- 24 million tons and after meeting domestic consumption of around 20 million tons, it would be left with a huge exportable surplus of over four million tons . It has also sizeable carry-over stocks from last season.
Similarly, there is a surplus cement production of around six million tons out of the total production of around 30 million tons per annum. Presently 19 cement units are operating and by June this year, another three million tons of cement capacity is expected to be added. Around 22 million tons of cement is consumed in the local market while around two million tons are being annually exported to Afghanistan.
The question however is: have the policy makers made any plan to take full advantage of huge surpluses in these bulk commodities to earn much needed foreign exchange to reduce the yawning trade deficit:? And has the Trade Development Authority of Pakistan (TDAP) been assigned with the task of facilitating exports of these two commodities?
Exporters and manufacturers of these two commodities are tapping foreign as well as Indian markets but without any governmental support and guidance. Some exporters have also shipped around 5000 tons of wheat to India on trial basis. Though the shipment has not yet reached Indian ports, exporters suspect that it may be rejected on some flimsy grounds including higher contents of foreign matter (edible and non-edible). Pakistani wheat normally has one to 1.5 per cent contents of foreign elements but is free from Kernel Bunt disease which is globally considered to be an Indian infection.
. The Indian intiial move to detain Pakistani cement is against Article-8 of South Asia Free Trade Agreement (Safta) under which the contracting Saarc members are bound to provide trade facilitation for mutual trade. A pertinent clause of this article is: âharmonisation of standards, reciprocal recognition of tests and accreditation of testing laboratories of contracting states and certification of products.â
In case, stipulated measures under Safta are not adopted by the Saarc states, there are other options available and which are also in vogue worldwide to facilitate trade between both countries. For ensuring quality and standards, pre-shipment inspection companies are operating and they could also be used by India for imports from Pakistan.
A US study has also given critical appraisal over Indian technical barriers to trade (mandatory standards) and stated that India has enforced mandatory certification for 109 products, down from over 150 products some time back. The mandatory quality certification covers a wide range of products e.g. various food items, food colours, cements etc. Imports of these items are allowed only after Bureau of Indian Standards (BIS) certification and permission to use the BIS mark.
The study further discloses that for certification of these 109 items detailed requirements have been issued under seven different Acts. It is a general complaint that the Indian government publishes Tariff, Additional Tax Rates and Notifications but there is no single official publication that covers all information on tariffs, fees and tax rates as well as the legislations under which formalities are to be completed.
All these are given in different Acts and all Acts have detailed Rules. Most of the requirements emanate from these Rules. This makes the whole system very cumbersome, time-consuming and even confusing. . Hence, there is a total lack of transparency. The standards specified are in many cases stricter than the international standards.
During a recent visit of a 10-member delegation from PHD Chamber of Commerce and Industry (oldest chamber of India) ,its President Mr Bhatia disclosed that there is also a demand of around three million tons of wheat in India. In a meeting with FPCCI the Indian delegation was informed about huge trade imbalance between the two countries and the NTBs issue also came under discussion. An executive member of Saarc Chamber of Commerce, Amjad Rafi told the delegation that time has come that India should remove NTBs and let Pakistani cement and wheat find its way in Indian market to improve bilateral trade imbalance..
But Indian diplomats always respond to Pakistanâs criticism of NTB by raising the issue of Pakistan not giving India Most Favoured Nation (MFN) status despite the worsening adverse trade imbalance against Pakistan. During a recent conference of Saarc chamber on Safta held in Bhurban, the Indian diplomat raised the issue of MFN status and was critical of Pakistan for not implementing SAFTA in letter and spirit.
But Pakistan gives the same treatment to Indian goods as to imports from any other country. All Indian goods at the entry points are treated at par with other imports originating from around the globe. And items in the positive list of 1078 items are allowed to be imported from India without any hurdles or technical barriers.
As a matter of fact, Indian goods not allowed for import reach Pakistani markets through third countries and according to private estimates, the volume of this informal trade is to the tune of $2 billion. During first three months (Jan to March), the official trade volume between both the countries reached $500 million mark and if the momentum is maintained for rest of the year, it would mean that the total trade could touch $2 billion by the end of 2007. But how long can Pakistan sustain widening imbalances in trade with its big neighbour protecting its huge market with non- tariff barriers?
http://www.dawn.com/2007/04/30/ebr16.htm
Monday, April 30, 2007
Indian economic bubble about to burst?
By Penny MacRae
Inflation has become a hot-button political issue for the ruling national Congress party as prices soar for everything from onions to lentils, squeezing the poor, and has been blamed for its defeat in two state elections this year
ITS gross domestic product has topped the trillion-dollar mark and corporate profits are at record highs, but concerns are surfacing that the Indian economic party is in trouble.
Last week, global ratings agency Moodyâs warned that India was showing classic signs of an overheating economy - when output is unable to keep pace with demand.
Moodyâs said overheating symptoms included âhigher than acceptableâ inflation coupled with strong growth, an increasing trade deficit, a credit boom and a rapid currency appreciation. âThe pursuit of macroeconomic stability by Indiaâs monetary authorities is at a critical phase and is important ... for ensuring the long-term sustainability of public finances,â said Moodyâs vice-president Kristin Lindow.
Leading Indian financial magazine Business Today posed the question on everyoneâs minds bluntly on the cover of its latest issue. âAre the good times over?â the magazine asked after the economyâs breakneck ride during which it has expanded by an average of more than 8.5 percent annually for the past four years.
The central bank has been moving aggressively to contain prices, imposing a slew of rate cuts and other monetary tightening measures. But inflation has remained stubbornly above six percent for most of the year and is more than a full percentage point over the bankâs target of five percent.
Inflation has become a hot-button political issue for the ruling national Congress party as prices soar for everything from onions to lentils, squeezing the poor, and has been blamed for its defeat in two state elections this year. The central bank now has made âprice stabilityâ its main goal, switching from its previous policy of seeking growth while tolerating moderate inflation.
Indiaâs economy still is expanding by nearly nine percent, creating capacity problems as industries struggle to keep pace with the demand of an increasingly affluent middle class.
Most factories are operating at full tilt and it could take up to 18 months to bring new capacity on stream, according to the central bank.
Dilapidated ports, roads and airports have exacerbated the situation, making it harder to transport goods. The Indian rupee, meanwhile, which last week touched a nine-year high to break below 41 per dollar, is in âuncharted waters,â said economist Rajiv Malik of JP Morgan in Singapore.
The rupee has appreciated 13.5 percent against the US dollar since mid-2006 as investors have poured billions of dollars into shares and other investments. Much of the rupee surge has come in the last two months. The central bank has adopted a hands-off approach to help check prices by avoiding selling rupees for dollars and pumping liquidity into the local banking system that fuels inflation.
The rupee rise has hit exporters which sell most of their goods to the United States. âThe significant rupee exchange rate needs to be corrected if exports - especially those of small and medium size enterprises - are to remain competitive,â said Malik. Looking ahead, the big worry says Goldman Sachs is that âinflation does not respond to monetary tightening due to supply side constraints while growth slows due to continued rate hikes, raising the spectre of stagflation.â
Stagflation is the term economists use to describe sluggish economic growth coupled with high inflation. A period of stagflation would dash Indian policy-makersâ hopes of achieving double-digit growth levels needed to lift millions out of poverty. Economists now expect growth for this financial year to March 31, 2008 to be slower than last yearâs 9.2 percent.
Goldman Sachs, for instance, forecasts growth of eight percent with risks âskewed to the downside due to the aggressive tightening.â Earnings of automakers, banks and other sectors are all expected to be hit by the monetary tightening in the months ahead. The auto industry has reported car sales at a 13-month low as consumers delay purchases due to higher loan costs.
TK Bhaumik, economist for Indiaâs biggest private company Reliance Industries, said authorities should be cautious of over-zealous tightening. âWhen we had a long period of economic recession beginning in 1996-97, the trigger was the preoccupation with inflation,â he noted. afp
http://www.dailytimes.com.pk/default.asp?page=2007\04\30\story_30-4-2007_pg4_24
Indian economic bubble about to burst?
By Penny MacRae
Inflation has become a hot-button political issue for the ruling national Congress party as prices soar for everything from onions to lentils, squeezing the poor, and has been blamed for its defeat in two state elections this year
ITS gross domestic product has topped the trillion-dollar mark and corporate profits are at record highs, but concerns are surfacing that the Indian economic party is in trouble.
Last week, global ratings agency Moodyâs warned that India was showing classic signs of an overheating economy - when output is unable to keep pace with demand.
Moodyâs said overheating symptoms included âhigher than acceptableâ inflation coupled with strong growth, an increasing trade deficit, a credit boom and a rapid currency appreciation. âThe pursuit of macroeconomic stability by Indiaâs monetary authorities is at a critical phase and is important ... for ensuring the long-term sustainability of public finances,â said Moodyâs vice-president Kristin Lindow.
Leading Indian financial magazine Business Today posed the question on everyoneâs minds bluntly on the cover of its latest issue. âAre the good times over?â the magazine asked after the economyâs breakneck ride during which it has expanded by an average of more than 8.5 percent annually for the past four years.
The central bank has been moving aggressively to contain prices, imposing a slew of rate cuts and other monetary tightening measures. But inflation has remained stubbornly above six percent for most of the year and is more than a full percentage point over the bankâs target of five percent.
Inflation has become a hot-button political issue for the ruling national Congress party as prices soar for everything from onions to lentils, squeezing the poor, and has been blamed for its defeat in two state elections this year. The central bank now has made âprice stabilityâ its main goal, switching from its previous policy of seeking growth while tolerating moderate inflation.
Indiaâs economy still is expanding by nearly nine percent, creating capacity problems as industries struggle to keep pace with the demand of an increasingly affluent middle class.
Most factories are operating at full tilt and it could take up to 18 months to bring new capacity on stream, according to the central bank.
Dilapidated ports, roads and airports have exacerbated the situation, making it harder to transport goods. The Indian rupee, meanwhile, which last week touched a nine-year high to break below 41 per dollar, is in âuncharted waters,â said economist Rajiv Malik of JP Morgan in Singapore.
The rupee has appreciated 13.5 percent against the US dollar since mid-2006 as investors have poured billions of dollars into shares and other investments. Much of the rupee surge has come in the last two months. The central bank has adopted a hands-off approach to help check prices by avoiding selling rupees for dollars and pumping liquidity into the local banking system that fuels inflation.
The rupee rise has hit exporters which sell most of their goods to the United States. âThe significant rupee exchange rate needs to be corrected if exports - especially those of small and medium size enterprises - are to remain competitive,â said Malik. Looking ahead, the big worry says Goldman Sachs is that âinflation does not respond to monetary tightening due to supply side constraints while growth slows due to continued rate hikes, raising the spectre of stagflation.â
Stagflation is the term economists use to describe sluggish economic growth coupled with high inflation. A period of stagflation would dash Indian policy-makersâ hopes of achieving double-digit growth levels needed to lift millions out of poverty. Economists now expect growth for this financial year to March 31, 2008 to be slower than last yearâs 9.2 percent.
Goldman Sachs, for instance, forecasts growth of eight percent with risks âskewed to the downside due to the aggressive tightening.â Earnings of automakers, banks and other sectors are all expected to be hit by the monetary tightening in the months ahead. The auto industry has reported car sales at a 13-month low as consumers delay purchases due to higher loan costs.
TK Bhaumik, economist for Indiaâs biggest private company Reliance Industries, said authorities should be cautious of over-zealous tightening. âWhen we had a long period of economic recession beginning in 1996-97, the trigger was the preoccupation with inflation,â he noted. afp
http://www.dailytimes.com.pk/default.asp?page=2007\04\30\story_30-4-2007_pg4_24
Indiaâs âbreadbasketâ aims to be new IT hotspot
CHANDIGARH, India: Fed up with traffic snarls and scarred roads, a software engineer in Indiaâs flagship IT hub of Bangalore took to the streets in protest last year doodling on his laptop while trotting along on a bullock-cart.
While Bangalore continues to host the bulk of Indiaâs IT business and is home to more than 1,500 top firms, poor roads and traffic woes are now pushing IT firms to look beyond Bangalore to newer cities like Chandigarh, hundreds of miles north.
Chandigarh is joint capital of the Punjab and Haryana states better known as Indiaâs âbreadbasketsâ. The city is now taking tentative steps to become a new corporate destination. âThe IT industry is excited about Chandigarhâs potential as an emerging IT destination,â said Kiran Karnik, president of the National Association of Software and Service Companies (NASSCOM), Indiaâs top trade body for the IT industry.
âAlready, many IT companies have begun operations there or have plans of doing so, making it one of the new âhot spotsâ for the IT industry,â he told Reuters by email. Infosys, Indiaâs second-largest software company, was among the first to move here and began full operations from its complex spread over 30 acres (12 hectares) in the Rajiv Gandhi Chandigarh Technology Park (RGCTP).
The office currently employs about 1,500 people and plans for more than 5,000 staff to work in the glass-walled building. At least 13 other companies operate from the 123 acres of the park, including Wipro Ltd, Bharti Airtel, Tech Mahindra, and eSys.
âWhen fully functional in the next few years, the park is expected to have 25,000 IT professionals,â said Chandigarhâs IT director Manjit Brar. âIt will be the IT hub of north India.â Current investment in the park, located on the outskirts of the city, is Rs7 billion ($165 million) and in two years it is expected to touch Rs30 billion ($711 million), Brar said.
The city hopes to benefit from a booming market that India dominates. Indiaâs software sector expects exports to rise 33 per cent to $31.3 billion in the fiscal year which ended on March 31, according to NASSCOM. In comparison, the Philippines earned $3.6 billion from outsourcing revenues in 2006.
Over 2001/06, Indiaâs share in global sourcing is estimated to have grown to 65 per cent for IT services and 45 per cent for back-office services like call centres.
While there is excitement about Chandigarh emerging as the new IT stop, there is concern it could go the Bangalore way if it is unable to sustain rapid growth which IT brings to a region.
âThere is no doubt that a lot of people are trying hard to sell Chandigarh as the next Silicon Valley in India,â said Simran Aujla, an IT professional. âBut I am not too sure if a city planned for 500,000 people will be able to sustain the rapid growth. Unless infrastructure keeps pace with growth, Chandigarh may become another Bangalore.â
To begin with Chandigarh is a federally-administered territory with restricted geographical boundaries. Millions of square feet of office space outside city limits are required for it to be a full-fledged IT destination something dependent on permission from the federal government.
But despite obstacles, many lives have already been changed. Before the IT park, local graduates had few options to get well-paid jobs near home. They would either go to IT centres like Gurgaon and Greater Noida on the outskirts of New Delhi, or travel hundreds of miles down south to Bangalore.
âI was very tense in my college days because being the only daughter, I knew my parents would never let me go to Bangalore,â said Amrita Singh, who works for a multinational company.
âI was afraid my degree in engineering would just go waste but today I have no dearth of job offers with so many big IT firms flocking to Chandigarh,â she added.
Real estate agents, too, are excited at rising property Prices. âThe IT park has pushed up real estate prices like never before,â said Amarjit Singh. âA small piece of land quoted for around Rs2.5 million ($59,270) a few years ago is today unavailable for 10 million Indian rupees ($237,100).â
http://www.thenews.com.pk/daily_detail.asp?id=53706
CHANDIGARH, India: Fed up with traffic snarls and scarred roads, a software engineer in Indiaâs flagship IT hub of Bangalore took to the streets in protest last year doodling on his laptop while trotting along on a bullock-cart.
While Bangalore continues to host the bulk of Indiaâs IT business and is home to more than 1,500 top firms, poor roads and traffic woes are now pushing IT firms to look beyond Bangalore to newer cities like Chandigarh, hundreds of miles north.
Chandigarh is joint capital of the Punjab and Haryana states better known as Indiaâs âbreadbasketsâ. The city is now taking tentative steps to become a new corporate destination. âThe IT industry is excited about Chandigarhâs potential as an emerging IT destination,â said Kiran Karnik, president of the National Association of Software and Service Companies (NASSCOM), Indiaâs top trade body for the IT industry.
âAlready, many IT companies have begun operations there or have plans of doing so, making it one of the new âhot spotsâ for the IT industry,â he told Reuters by email. Infosys, Indiaâs second-largest software company, was among the first to move here and began full operations from its complex spread over 30 acres (12 hectares) in the Rajiv Gandhi Chandigarh Technology Park (RGCTP).
The office currently employs about 1,500 people and plans for more than 5,000 staff to work in the glass-walled building. At least 13 other companies operate from the 123 acres of the park, including Wipro Ltd, Bharti Airtel, Tech Mahindra, and eSys.
âWhen fully functional in the next few years, the park is expected to have 25,000 IT professionals,â said Chandigarhâs IT director Manjit Brar. âIt will be the IT hub of north India.â Current investment in the park, located on the outskirts of the city, is Rs7 billion ($165 million) and in two years it is expected to touch Rs30 billion ($711 million), Brar said.
The city hopes to benefit from a booming market that India dominates. Indiaâs software sector expects exports to rise 33 per cent to $31.3 billion in the fiscal year which ended on March 31, according to NASSCOM. In comparison, the Philippines earned $3.6 billion from outsourcing revenues in 2006.
Over 2001/06, Indiaâs share in global sourcing is estimated to have grown to 65 per cent for IT services and 45 per cent for back-office services like call centres.
While there is excitement about Chandigarh emerging as the new IT stop, there is concern it could go the Bangalore way if it is unable to sustain rapid growth which IT brings to a region.
âThere is no doubt that a lot of people are trying hard to sell Chandigarh as the next Silicon Valley in India,â said Simran Aujla, an IT professional. âBut I am not too sure if a city planned for 500,000 people will be able to sustain the rapid growth. Unless infrastructure keeps pace with growth, Chandigarh may become another Bangalore.â
To begin with Chandigarh is a federally-administered territory with restricted geographical boundaries. Millions of square feet of office space outside city limits are required for it to be a full-fledged IT destination something dependent on permission from the federal government.
But despite obstacles, many lives have already been changed. Before the IT park, local graduates had few options to get well-paid jobs near home. They would either go to IT centres like Gurgaon and Greater Noida on the outskirts of New Delhi, or travel hundreds of miles down south to Bangalore.
âI was very tense in my college days because being the only daughter, I knew my parents would never let me go to Bangalore,â said Amrita Singh, who works for a multinational company.
âI was afraid my degree in engineering would just go waste but today I have no dearth of job offers with so many big IT firms flocking to Chandigarh,â she added.
Real estate agents, too, are excited at rising property Prices. âThe IT park has pushed up real estate prices like never before,â said Amarjit Singh. âA small piece of land quoted for around Rs2.5 million ($59,270) a few years ago is today unavailable for 10 million Indian rupees ($237,100).â
http://www.thenews.com.pk/daily_detail.asp?id=53706
BD to discuss Myanmar gas link to India
DHAKA: Bangladesh said on Monday it was ready to negotiate an Indian proposal to bring natural gas from Myanmar by laying a pipeline through Bangladesh territory.
âWe are ready to negotiate the proposal to obtain best possible benefit from the project,â Iftekhar Ahmed Chowdhury, adviser to the army-backed interim government and head of the foreign affairs ministry, told reporters.
He was speaking after returning from a bilateral visit to Myanmar. Under the project, India will build a 290-km (181-mile) pipeline through Bangladesh to connect offshore gas fields in Myanmar to Indian states, officials said.
The proposed pipeline will enter Bangladesh through its eastern Brahmanbaria border from the Indian territory of Tripura and cross into West Bengal through northern Rajshahi border. Bangladesh and India agreed in principle in 2005 on a three-nation gas pipeline project, allowing India to bring natural gas from Myanmar and Bangladesh to increase trade with landlocked Bhutan and Nepal using Indian territory.
In the same year Bangladesh, India and Myanmar agreed to finalise soon details of the gas pipeline project, which would cost more than $1 billion. But work on the project has been delayed due to differences between Dhaka and New Delhi over the trade and corridor issues. If the plan is implemented, about $350 million will be invested in Bangladesh and it will get nearly $100 million as a carrier fee per year, energy officials said. Bangladesh will also get another $100 million as a one-off âright of wayâ charge and $25 million each year for sharing in its management, the officials said.
http://www.thenews.com.pk/daily_detail.asp?id=53707
DHAKA: Bangladesh said on Monday it was ready to negotiate an Indian proposal to bring natural gas from Myanmar by laying a pipeline through Bangladesh territory.
âWe are ready to negotiate the proposal to obtain best possible benefit from the project,â Iftekhar Ahmed Chowdhury, adviser to the army-backed interim government and head of the foreign affairs ministry, told reporters.
He was speaking after returning from a bilateral visit to Myanmar. Under the project, India will build a 290-km (181-mile) pipeline through Bangladesh to connect offshore gas fields in Myanmar to Indian states, officials said.
The proposed pipeline will enter Bangladesh through its eastern Brahmanbaria border from the Indian territory of Tripura and cross into West Bengal through northern Rajshahi border. Bangladesh and India agreed in principle in 2005 on a three-nation gas pipeline project, allowing India to bring natural gas from Myanmar and Bangladesh to increase trade with landlocked Bhutan and Nepal using Indian territory.
In the same year Bangladesh, India and Myanmar agreed to finalise soon details of the gas pipeline project, which would cost more than $1 billion. But work on the project has been delayed due to differences between Dhaka and New Delhi over the trade and corridor issues. If the plan is implemented, about $350 million will be invested in Bangladesh and it will get nearly $100 million as a carrier fee per year, energy officials said. Bangladesh will also get another $100 million as a one-off âright of wayâ charge and $25 million each year for sharing in its management, the officials said.
http://www.thenews.com.pk/daily_detail.asp?id=53707
âIndia must industrialise to create jobsâ
NEW DELHI, India: India must step up industrialisation to cut dependence on the farm sector, Prime Minister Manmohan Singh said on Tuesday, in a rebuff to critics who oppose such development.
âThere are severe limitations to expanding employment opportunities in agriculture on a large scale,â Singh told a college campus audience. âA developing country like ours cannot afford to view industrialisation as a negative phenomenon,â Singh said.
His comments came amid increasingly violent demonstrations for greater economic and social rights with leftist rebels carrying out deadly attacks and villagers opposing setting up of industries in many parts of the country.
Reliable unemployment data is not regularly available, and does not include millions of under-employed people but economists say joblessness is a major problem. Agriculture which contributes less than 25 per cent to total GDP employs nearly 60 per cent of Indiaâs 1.1 billion population. Nearly 30 per cent of people are employed in the services sector.
âWe have to find ways and means to accelerate the process of industrialisation and to ensure this process is sufficiently labour intensive,â Singh said. Singh also expressed concern over the uneven pace of industrialisation in the country, where the economy is growing at more than eight per cent.
âI am also puzzled by the persisting regional imbalance in industrial development and urbanisation in India,â he said. âThere are areas of concern, like displacement of people, like environmental damage, like alienation of the working class. These concerns must be dealt with.â
The Asian Development Bank warned last month that unemployment rates could hit growth rates in Asia by several percentage points. The bank estimated at least half a billion people out of a workforce of 1.7 billion in the region were unemployed or under-employed.
http://www.thenews.com.pk/daily_detail.asp?id=53821
NEW DELHI, India: India must step up industrialisation to cut dependence on the farm sector, Prime Minister Manmohan Singh said on Tuesday, in a rebuff to critics who oppose such development.
âThere are severe limitations to expanding employment opportunities in agriculture on a large scale,â Singh told a college campus audience. âA developing country like ours cannot afford to view industrialisation as a negative phenomenon,â Singh said.
His comments came amid increasingly violent demonstrations for greater economic and social rights with leftist rebels carrying out deadly attacks and villagers opposing setting up of industries in many parts of the country.
Reliable unemployment data is not regularly available, and does not include millions of under-employed people but economists say joblessness is a major problem. Agriculture which contributes less than 25 per cent to total GDP employs nearly 60 per cent of Indiaâs 1.1 billion population. Nearly 30 per cent of people are employed in the services sector.
âWe have to find ways and means to accelerate the process of industrialisation and to ensure this process is sufficiently labour intensive,â Singh said. Singh also expressed concern over the uneven pace of industrialisation in the country, where the economy is growing at more than eight per cent.
âI am also puzzled by the persisting regional imbalance in industrial development and urbanisation in India,â he said. âThere are areas of concern, like displacement of people, like environmental damage, like alienation of the working class. These concerns must be dealt with.â
The Asian Development Bank warned last month that unemployment rates could hit growth rates in Asia by several percentage points. The bank estimated at least half a billion people out of a workforce of 1.7 billion in the region were unemployed or under-employed.
http://www.thenews.com.pk/daily_detail.asp?id=53821
May 02, 2007
Indian trade deficit
NEW DELHI, May 1: Indiaâs trade deficit widened to nearly $57 billion in the year ended March as a surge in the cost of imports led by oil offset a record year for exports, government data showed on Tuesday.
Exports rose 23.9pc to a record $124.6bn, in line with a target of $125bn for the year, while imports jumped 29.3pc to $181.4bn led by oil, the government said.
The countryâs crude oil imports jumped 30.3 per cent to $57.3 billion in the year ended March, the government said.
India, which imports almost two thirds of its petroleum needs, had a trade deficit last year of $39bn.Last month, trade minister Kamal Nath forecast exports by India would grow to $160bn in the year started April 1 and would reach $200bn by 2009.
http://www.dawn.com/2007/05/02/ebr8.htm
Indian trade deficit
NEW DELHI, May 1: Indiaâs trade deficit widened to nearly $57 billion in the year ended March as a surge in the cost of imports led by oil offset a record year for exports, government data showed on Tuesday.
Exports rose 23.9pc to a record $124.6bn, in line with a target of $125bn for the year, while imports jumped 29.3pc to $181.4bn led by oil, the government said.
The countryâs crude oil imports jumped 30.3 per cent to $57.3 billion in the year ended March, the government said.
India, which imports almost two thirds of its petroleum needs, had a trade deficit last year of $39bn.Last month, trade minister Kamal Nath forecast exports by India would grow to $160bn in the year started April 1 and would reach $200bn by 2009.
http://www.dawn.com/2007/05/02/ebr8.htm
Thursday, May 03, 2007
Indiaâs Suzlon clinches biggest ever wind turbine contract
NEW DELHI: Indiaâs Suzlon Energy has clinched its single biggest contract to supply wind turbine capacity to a US wind power developer, the company said Wednesday.
Suzlon Wind Energy Corp, a unit of Denmark-based Suzlon Energy A/S (SEAS), has signed a contract for 400 megawatts (MW) of wind turbine capacity with PPM Energy of Portland, Oregon, a statement said.
âThis agreement is Suzlonâs single largest contract for wind turbine capacityâ so far, said Suzlon, ranked as the worldâs fifth leading wind turbine manufacturer with more than six percent of global market share. Suzlon gave no financial details of the deal. PPM is one of the largest wind power developers in North America and part of the Iberdrola group, the world leader in wind power with more than 6,500 MW of combined wind power capacity.
http://www.dailytimes.com.pk/default.asp?page=2007\05\03\story_3-5-2007_pg5_28
Indiaâs Suzlon clinches biggest ever wind turbine contract
NEW DELHI: Indiaâs Suzlon Energy has clinched its single biggest contract to supply wind turbine capacity to a US wind power developer, the company said Wednesday.
Suzlon Wind Energy Corp, a unit of Denmark-based Suzlon Energy A/S (SEAS), has signed a contract for 400 megawatts (MW) of wind turbine capacity with PPM Energy of Portland, Oregon, a statement said.
âThis agreement is Suzlonâs single largest contract for wind turbine capacityâ so far, said Suzlon, ranked as the worldâs fifth leading wind turbine manufacturer with more than six percent of global market share. Suzlon gave no financial details of the deal. PPM is one of the largest wind power developers in North America and part of the Iberdrola group, the world leader in wind power with more than 6,500 MW of combined wind power capacity.
http://www.dailytimes.com.pk/default.asp?page=2007\05\03\story_3-5-2007_pg5_28
India, China border trade pass reopens month ahead of schedule
GUWAHATI, India: Asian giants India and China have reopened trade via a famed alpine Silk Road route a month earlier than scheduled in response to demands from businesses on both sides, a local official said on Thursday.
âTrading was earlier scheduled to begin June 1 and last till September 30,â said Saman Prasad Subba, director of industry and commerce in the tiny state of Sikkim, wedged between India and Tibet.
âBut the two countries agreed to demands by traders to allow business from May 1 to November 30,â Subba told AFP by telephone.
âA total of 29 Chinese traders came to the Indian side with items while 13 people from India crossed over to China in the first two days of trading.â
India and China first started trade across the 15,000-feet (4,545-metre) Nathu La Pass, 52 kilometres (32 miles) east of Sikkimâs capital Gangtok, last July as part of efforts to mend ties dogged by a bitter border war in 1962.
Indian officials say the move marked Beijingâs recognition of Indiaâs sovereignty over previously disputed Sikkim state.
Tibetâs commerce department says bilateral trade last year through Nathu La totalled about 190,000 dollars.
While about 900 Chinese traders crossed into India through the border marked by a rusty barbed wire to the bazaar of Sherathang, 400 Indians headed to the Renqinggang interim market in Tibet.
Businessmen from both sides of the border were now seeking a broadening of the list of items traded through the Nathu-La pass.
At present India imports 15 items from China including silk, yak pelts and horses, and exports 29 goods that include textiles, tea, rice, vegetables and herbs.
âThe present list of import-export should be widened. The list of goods notified for transaction is a list prepared long ago and has to be upgraded,â said S K Sarda, president of the Sikkim Chamber of Commerce. âWe understand the governments of the two countries were actively considering revising the tradable items list to make business at the border more robust and vibrant,â he said.
The Sikkim government will also urge New Delhi to sign a pact with Beijing to allow tourists to use the border pass.
âAt present, only traders are allowed to cross over and if tourism is opened it would be economically beneficial for both countries,â Subba added.
http://www.thenews.com.pk/daily_detail.asp?id=54143
GUWAHATI, India: Asian giants India and China have reopened trade via a famed alpine Silk Road route a month earlier than scheduled in response to demands from businesses on both sides, a local official said on Thursday.
âTrading was earlier scheduled to begin June 1 and last till September 30,â said Saman Prasad Subba, director of industry and commerce in the tiny state of Sikkim, wedged between India and Tibet.
âBut the two countries agreed to demands by traders to allow business from May 1 to November 30,â Subba told AFP by telephone.
âA total of 29 Chinese traders came to the Indian side with items while 13 people from India crossed over to China in the first two days of trading.â
India and China first started trade across the 15,000-feet (4,545-metre) Nathu La Pass, 52 kilometres (32 miles) east of Sikkimâs capital Gangtok, last July as part of efforts to mend ties dogged by a bitter border war in 1962.
Indian officials say the move marked Beijingâs recognition of Indiaâs sovereignty over previously disputed Sikkim state.
Tibetâs commerce department says bilateral trade last year through Nathu La totalled about 190,000 dollars.
While about 900 Chinese traders crossed into India through the border marked by a rusty barbed wire to the bazaar of Sherathang, 400 Indians headed to the Renqinggang interim market in Tibet.
Businessmen from both sides of the border were now seeking a broadening of the list of items traded through the Nathu-La pass.
At present India imports 15 items from China including silk, yak pelts and horses, and exports 29 goods that include textiles, tea, rice, vegetables and herbs.
âThe present list of import-export should be widened. The list of goods notified for transaction is a list prepared long ago and has to be upgraded,â said S K Sarda, president of the Sikkim Chamber of Commerce. âWe understand the governments of the two countries were actively considering revising the tradable items list to make business at the border more robust and vibrant,â he said.
The Sikkim government will also urge New Delhi to sign a pact with Beijing to allow tourists to use the border pass.
âAt present, only traders are allowed to cross over and if tourism is opened it would be economically beneficial for both countries,â Subba added.
http://www.thenews.com.pk/daily_detail.asp?id=54143
IOC plans exports to Pakistan
NEW DELHI: State-run Indian Oil Corp (IOC) is looking to export some petrochemical products to Pakistan, Indiaâs junior oil minister said on Thursday. Sales of purified terephthalic (PTA), used in the production of polyester, were being pursued, he said. âThe proposal involves transport of PTA by road and by railing containers across Wagah border,â Dinsha Patel told lawmakers. The Wagah crossing is a major border transit point near the Indian city of Amritsar and Pakistanâs Lahore. In March 2006, Islamabad allowed Pakistan State Oil to import 10,000 tonnes of Group II lube oil base stock from IOC on a one time basis.
http://www.thenews.com.pk/daily_detail.asp?id=54149
NEW DELHI: State-run Indian Oil Corp (IOC) is looking to export some petrochemical products to Pakistan, Indiaâs junior oil minister said on Thursday. Sales of purified terephthalic (PTA), used in the production of polyester, were being pursued, he said. âThe proposal involves transport of PTA by road and by railing containers across Wagah border,â Dinsha Patel told lawmakers. The Wagah crossing is a major border transit point near the Indian city of Amritsar and Pakistanâs Lahore. In March 2006, Islamabad allowed Pakistan State Oil to import 10,000 tonnes of Group II lube oil base stock from IOC on a one time basis.
http://www.thenews.com.pk/daily_detail.asp?id=54149
Saturday, May 05, 2007
India joins ranks of regular wheat importers
NEW DELHI: Faced with a dwindling grain bin, India is tapping the costly import market for the second year in a row in what could be a pattern: the country is emerging as a regular purchaser of the grain.
The government, seemingly unable to make deals to buy wheat from farmers in the middle of the peak marketing season, on Monday floated a tender to import 1 million tonnes of wheat.
Hours earlier, the countryâs state-run grains agency, the Food Corp of India, opened a tender to import wheat through a call option.
The aim was to hedge against possible expensive grain imports by asking firms to agree to prices in advance in return for a non-refundable premium.
But the move was greeted coolly by the market because of rigid import conditions. Two global bidders offered paltry quantities at high prices, ranging between $298 and $329 per tonne for deliveries later in the year.
âIt looks like wheat imports will be a regular feature now as it will be difficult for the government to buy enough grain from farmers, who have become smart,â said Atul Chaturvedi, president of Adani Exports Ltd.
The country currently has 12 million tonnes of wheat stocks, including wheat purchases from farmers and stocks carried over from imports made in 2006.
Analysts say because of low procurement India will need to import at least 3 million tonnes of wheat this year to augment stocks which are used for welfare schemes.
India has one wheat crop a year, mostly in the northern states, and output has been stagnating around 70 million tonnes.
But consumption has been growing with people in the southern regions eating more wheat, rapid growth in population and a rise in incomes.
Kishore Narne, vice-president of Mumbai-based AnandRathi Securities Ltd., said a average crop size of 72-73 million tonnes would make supplies tight.
With global and domestic wheat prices firm, farmers this year are not selling their grain, hoping to sell at a much higher price after the harvests is completed in May.
Government agencies have only purchased about 8 million tonnes of wheat from farmers against a target of 15 million, and with wheat only trickling into the market, doubts have arisen if buying will touch even 11 million tonnes.
India, the worldâs second-largest wheat producer, was forced to import 5.5 million tonnes in 2006 after procurement totalled 9.5 million tonnes against a target of 16 million.
Private firms such as Cargill offered farmers more than the government-fixed price.
âThe grain is arriving piecemeal, making procurement difficult,â said Chaturvedi.
The farm ministry has forecast the wheat crop will rise to of 73.7 million tonnes this year from 69.4 million last year.
âI do see India importing around 2-4 million tonnes of wheat in the next two to three years because consumption has been going up as the economy expands,â said D.P. Singh, president of the All India Grain Exporters Association.
Most of last yearâs imports were contracted at an average price of $205 per tonne while wheat is now being quoted at $220-240 per tonne on the global market.
But wheat cost would be much higher this year with freight costs alone going up by $25 a tonne over the last year to $70 and lack of offers from Australia and Europe leading to tightness in supplies.
http://www.dailytimes.com.pk/default.asp?page=2007\05\05\story_5-5-2007_pg5_27
India joins ranks of regular wheat importers
NEW DELHI: Faced with a dwindling grain bin, India is tapping the costly import market for the second year in a row in what could be a pattern: the country is emerging as a regular purchaser of the grain.
The government, seemingly unable to make deals to buy wheat from farmers in the middle of the peak marketing season, on Monday floated a tender to import 1 million tonnes of wheat.
Hours earlier, the countryâs state-run grains agency, the Food Corp of India, opened a tender to import wheat through a call option.
The aim was to hedge against possible expensive grain imports by asking firms to agree to prices in advance in return for a non-refundable premium.
But the move was greeted coolly by the market because of rigid import conditions. Two global bidders offered paltry quantities at high prices, ranging between $298 and $329 per tonne for deliveries later in the year.
âIt looks like wheat imports will be a regular feature now as it will be difficult for the government to buy enough grain from farmers, who have become smart,â said Atul Chaturvedi, president of Adani Exports Ltd.
The country currently has 12 million tonnes of wheat stocks, including wheat purchases from farmers and stocks carried over from imports made in 2006.
Analysts say because of low procurement India will need to import at least 3 million tonnes of wheat this year to augment stocks which are used for welfare schemes.
India has one wheat crop a year, mostly in the northern states, and output has been stagnating around 70 million tonnes.
But consumption has been growing with people in the southern regions eating more wheat, rapid growth in population and a rise in incomes.
Kishore Narne, vice-president of Mumbai-based AnandRathi Securities Ltd., said a average crop size of 72-73 million tonnes would make supplies tight.
With global and domestic wheat prices firm, farmers this year are not selling their grain, hoping to sell at a much higher price after the harvests is completed in May.
Government agencies have only purchased about 8 million tonnes of wheat from farmers against a target of 15 million, and with wheat only trickling into the market, doubts have arisen if buying will touch even 11 million tonnes.
India, the worldâs second-largest wheat producer, was forced to import 5.5 million tonnes in 2006 after procurement totalled 9.5 million tonnes against a target of 16 million.
Private firms such as Cargill offered farmers more than the government-fixed price.
âThe grain is arriving piecemeal, making procurement difficult,â said Chaturvedi.
The farm ministry has forecast the wheat crop will rise to of 73.7 million tonnes this year from 69.4 million last year.
âI do see India importing around 2-4 million tonnes of wheat in the next two to three years because consumption has been going up as the economy expands,â said D.P. Singh, president of the All India Grain Exporters Association.
Most of last yearâs imports were contracted at an average price of $205 per tonne while wheat is now being quoted at $220-240 per tonne on the global market.
But wheat cost would be much higher this year with freight costs alone going up by $25 a tonne over the last year to $70 and lack of offers from Australia and Europe leading to tightness in supplies.
http://www.dailytimes.com.pk/default.asp?page=2007\05\05\story_5-5-2007_pg5_27
India Incâs overseas investment jumps 180% 
SATURDAY, MAY 05, 2007
NEW DELHI: India Inc increased its overseas investments by a whopping 180% in 2006-07 compared to the corresponding period in the previous fiscal. While the domestic companies invested close to $8 billion overseas in the previous fiscal, total investments abroad stood at a meagre $3 billion in 2005-06.
Bulk of the money invested abroad was routed to the UK, the Netherlands, Mauritius, Cyprus and Russia â which have been identified as the five top investment destinations in the last fiscal. The minister of state in the finance ministry, Pawan Kumar Bansal, said in reply to a question in Parliament that direct investment in foreign countries by Indian companies increased from â$2.8 billion in 2004-05 to $2.85 billion in 2005-06, and to $7.95 billion in 2006-07â.
âLiberalising and streamlining of procedures towards overseas direct investment during recent yearsâ was identified as the main reason for increased investments by the minister. Recently, in its annual monetary policy, RBI raised the overseas investment limit for Indian companies to 300% of their net worth from the previously-applicable ceiling of 200%. In addition, the companies can place 35% of their net worth against 25% earlier in portfolio investment in listed overseas companies.
âIndian companies are increasingly looking out and overseas investments will be on the rise, both in greenfield ventures and acquisitions. The proposed hike in the cap for overseas direct investment from 200% to 300% of net worth will further boost overseas expansion by Indian corporates,â PwC principal consultant Radhika Jain said. Analysts pointed out that since Indian companies have been on an acquisition spree, such numbers are not startling. The total value of M&As have grown at a CAGR of 28% between 2002 and 2006, a Grant Thornton report said.
, one of the worldâs largest accounting organisations, said. According to the report, the total number of M&A deals increased from 343 in 2005 to 480 in 2006. Also, it has been stated that from 1995 to August 2006, the largest proportion of outbound acquisitions (Indian companies acquiring companies overseas) has been in North America, which accounted for 32% of total outbound deal. Europe accounted for 29% of the total deals.
http://economictimes.indiatimes.com..._investment_jumps_180/articleshow/2005873.cms
SATURDAY, MAY 05, 2007
NEW DELHI: India Inc increased its overseas investments by a whopping 180% in 2006-07 compared to the corresponding period in the previous fiscal. While the domestic companies invested close to $8 billion overseas in the previous fiscal, total investments abroad stood at a meagre $3 billion in 2005-06.
Bulk of the money invested abroad was routed to the UK, the Netherlands, Mauritius, Cyprus and Russia â which have been identified as the five top investment destinations in the last fiscal. The minister of state in the finance ministry, Pawan Kumar Bansal, said in reply to a question in Parliament that direct investment in foreign countries by Indian companies increased from â$2.8 billion in 2004-05 to $2.85 billion in 2005-06, and to $7.95 billion in 2006-07â.
âLiberalising and streamlining of procedures towards overseas direct investment during recent yearsâ was identified as the main reason for increased investments by the minister. Recently, in its annual monetary policy, RBI raised the overseas investment limit for Indian companies to 300% of their net worth from the previously-applicable ceiling of 200%. In addition, the companies can place 35% of their net worth against 25% earlier in portfolio investment in listed overseas companies.
âIndian companies are increasingly looking out and overseas investments will be on the rise, both in greenfield ventures and acquisitions. The proposed hike in the cap for overseas direct investment from 200% to 300% of net worth will further boost overseas expansion by Indian corporates,â PwC principal consultant Radhika Jain said. Analysts pointed out that since Indian companies have been on an acquisition spree, such numbers are not startling. The total value of M&As have grown at a CAGR of 28% between 2002 and 2006, a Grant Thornton report said.
, one of the worldâs largest accounting organisations, said. According to the report, the total number of M&A deals increased from 343 in 2005 to 480 in 2006. Also, it has been stated that from 1995 to August 2006, the largest proportion of outbound acquisitions (Indian companies acquiring companies overseas) has been in North America, which accounted for 32% of total outbound deal. Europe accounted for 29% of the total deals.
http://economictimes.indiatimes.com..._investment_jumps_180/articleshow/2005873.cms
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