Tag: trade

India trade talks on dual-use goods, software, and tech set for January 30

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Commerce Ministry’s ‘Trade Connect ePlatform’ for Indian exporters to go live in 2-3 months 

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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In a bid to enhance the facilitation of Indian exporters, Commerce and Industry Minister Piyush Goyal, recently, revealed plans to introduce a ‘Trade Connect’ ePlatform. The first phase of this platform is expected to be operational within the next 2-3 months.

The portal aims to answer Frequently Asked Questions (FAQs) by existing & aspiring exporters on identification of products for export, non-tariff barriers, updated tariff schedule of items, the latest applicable customs duty and applicability of India’s FTAs to individual products.

Every Importer Exporter Code (IEC) will have a dedicated page on the portal with an auto-verification process.

“The ePlatform is expected to provide facilitation for new and aspiring exporters, information on various regulations to access markets, sectors, export trends, easy access of benefits under Free Trade Agreements, access to sector specific events along with a facility to address trade related queries to officials in Government of India and associated entities to get expert advice. The platform is likely to be ready in 3-4 months’ time period,” the ministry said in a statement.

Describing the ePlatform as a one-stop-shop for exporters and importers to connect with existing portals, Director General of Foreign Trade (DGFT) Santosh Kumar Sarangi told CNBC-TV18 that credit facilities will be also be available in the 2nd phase of the ePlatform.

The DGFT said that the meeting also emphasized collaboration to boost exports from export-deficient states, linking higher exports to higher per capita income, and spotlighting key contributing states such as Gujarat, Maharashtra, Karnataka, and Tamil Nadu. The 4 states account for 65% of India’s total exports and have a higher PCI than the national average, he added.

Explaining that even the value chains associated with exports benefits from them, he said that the benefit also comes by adapting to global benchmarks, citing examples of visible economic affluence from exports in the mango orchards and banana clusters in Navsari in Gujarat; the grape growing belt in Nashik in Maharashtra, and the coffee estates of Coorg in Karnataka.

Sarangi urged traders to promote exports for nation-building, underlining the need for more inclusive distribution of export benefits across India’s districts, “only 62 of over 760 districts in India account for 80% of all exports,” he noted.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Cost of freight, insurance rises for shipments due to Red Sea conflict; imports currently cushioned by inventory

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The cost of freight and insurance for shipments has risen in the last one month owing to the ongoing conflict in the Red Sea, which has forced ships to avoid the Suez Canal and take a longer route around the African peninsula, sources in the government told CNBC-TV18.

Government officials met shipping companies and exporters on Thursday, January 4, to take stock of the financial impact of the Red Sea conflict, where it was informed that, though the cushion of a month’s inventory is currently available for imported items, disruptions may arise in the near future if the conflict prolongs.

A government official has said that there’s no shortage of shipping containers, but the turnaround time has increased by 14 days.

With the containers taking a longer route across Africa, trade of goods with the US, Europe, and Latin America isn’t just taking longer but also costing more.

ALSO READ | Red Sea woes will trigger surge in freight costs and export delays: Centrum

The official also said that the Ministry of Defence is helping to escort many ships with consignments in the course of their travel on the high seas.

On December 21, 2023, CNBC-TV18 reported that basmati rice exports from India to Western countries may become 15% to 20% more expensive if the conflict in the Red Sea doesn’t subside soon.

Basmati rice exports from India had grown by 20% year-on-year in the period between April 1 to December 8, 2023.

However, the government remains hopeful that the increased prices of basmati rice won’t impact its overall global demand.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

India’s trade deficit narrows in September as imports dip, services exports rise

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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India’s trade deficit narrowed in September led by a dip in imports and a rise in services exports. In recent months, there has been concern about the stagnation of exports potentially leading to a rise in the trade deficit. However, these worries have been alleviated by the September data.

Goods imports for September stood at $53.84 billion, a notable drop from the $58.64 billion recorded in August. Meanwhile, goods exports remained stable at $34.47 billion in September, virtually unchanged from the $34.48 billion reported in the previous month.

Additionally, services exports for September showed positive growth, reaching $29.37 billion, as opposed to the $26.39 billion in August. Consequently, the overall goods trade deficit for September has contracted to $19.37 billion, significantly lower than the $24.16 billion reported in August.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

EU terms proposed CBAM as non-discriminatory between domestic and imported goods

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Valdis Dombrovskis, the European Commissioner for Trade, has termed the proposed Carbon Border Adjustment Mechanism (CBAM) as “non-discriminatory” between domestic and imported goods, even as the European Union (EU) aims for climate neutrality by 2050.

Stating that the work towards carbon neutrality involves setting a price on carbon in economic activities and addressing carbon leakages, he said that the plan is to remove exemptions for both domestic polluters and importers.

Previously, many energy-intensive sectors like cement, steel, aluminium, and electrolysers, were exempted from any carbon taxes. However, the anticipated implementation of the CBAM is scheduled for 2026.

During a conversation with Commerce and Industry Minister Piyush Goyal at the B20 India Summit 2023 in New Delhi, Dombrovskis acknowledged that while it’s not easy to manage disagreements within the 27-nation bloc, there’s political will to work as a European family, aiming to be a superpower with a unified market. Dombrovskis pointed out a growing consensus within the EU to strengthen ties with India, promoting supply chain diversification in the long term.

Expressing optimism over the upcoming WTO ministerial in Abu Dhabi, US Trade Representative Katherine Tai said that despite trade frictions, India’s G20 Presidency theme of “One planet, one family, one future” should be kept in mind to demonstrate that like any family, countries can differ on several issues.

Tai stressed the importance of political alignment to resolve pending issues and engage with trading partners and batted for collaboration and cooperation on international fora to foster economic development that is inclusive and resilient.

Discussing the India-US trade relationship at a peak, Tai elaborated on the Indo-Pacific Economic Framework (IPEF) as a new engagement platform reflecting several global economic shifts and uncertainties arising from climate crises and digital transformations.

Even as Piyush Goyal looks for bipartisan support for trade agreements, as achieved with the Australian government and opposition, the Australian trade minister disclosed ongoing discussions regarding the second stage of the ECTA.

Additionally, Oman’s trade minister, Qais bin Mohammed Al Yousef, anticipated a Free Trade Agreement (FTA) between India and the Gulf Cooperation Council (GCC). He expressed the intention to expedite discussions during the upcoming GCC meeting scheduled for the following week.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Analysing India-UAE CEPA: Trade soars to new heights as trade deficit woes persist

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The Comprehensive Economic Partnership Agreement (CEPA), which was signed between India and the United Arab Emirates (UAE) a year ago, is currently being reviewed by the key officials of the countries. The pact inked after 88 days of negotiations has been a success with concerns of India’s widening trade deficit still hovering over it. A closer look at its fineprint highlights the hits and misses of this mechanism.

The landmark agreement, which was signed in February 2022, aims to boost merchandise trade between the two countries to US $100 billion over the next five years. In the first 11 months of the implementation itself, the non-oil trade hit the US $45.4 billion mark. According to the data by the Ministry of Commerce and Industry (MOCI), the total trade between India and UAE jumped over US $84 billion in March 2023 from US $73 billion in March 2022. The 16 percent YoY increase was despite the downturn in global trade.

In India, sectors like mineral fuels; electrical machinery (particularly telephone equipment); gems & jewellery; automobiles (transport vehicles segment); essential oils/perfumes/cosmetics and others witnessed significant export growth.

By removing or reducing tariffs on over 80 percent of the product line, CEPA prompted investment in priority sectors like petrochemicals, pharmaceuticals, metals (e.g. aluminum, copper), agricultural products and intellectual property. It also offered a platform for cooperation and expansion of small and medium-sized enterprises (SMEs) with the elimination of unnecessary barriers to trade.

A lot of labour intensive sectors like pharmaceuticals have been benefitted by the elimination of certain tariffs, believes Jehil Thakkar, Partner, Deloitte India. “For instance in the pharmaceutical industry the tariffs were around 10-15 percent but they are removed now. In terms of gems and jewelleries, the 7.5 percent custom duties on a site have been eliminated. So, overall, I believe the benefits are starting to roll through,” he adds.

Speaking after the first meeting of the joint committee of India-UAE on CEPA, commerce minister Piyush Goyal said that the central banks of both nations are actively discussing rupee trade under this mechanism.

“Given the acceptability of Indian payment systems like UPI in many countries now, the possibility is certainly there,” says Thakkar. He added that such payment mechanisms lower costs and offer ease in doing business. Clearly such an arrangement will benefit India, he believes.

Additionally, the UAE has promised to grant 1.40 lakh visas to highly skilled Indian workers by 2030. Also, export-oriented industries like textiles, handlooms, and footwear are expected to create over 1 million jobs.

Although this arrangement has been a success, the concerning factor from India’s point of view is its widening trade deficit, which has gone beyond US $15 billion. India’s exports to the UAE grew by 11 percent to US $20.25 billion and at the same time, imports climbed by 24.4 percent to US $ 36.23 billion. A year ago, the trade deficit number was at US $10.89 billion.

While addressing this concern, India’s ambassador to the UAE, Sunjay Sudhir had said that widening trade deficit is a result of spiking oil prices.

“The trade deficit by itself is not a massive concern,” mentions Thakkar. He adds that if looked at in context of our overall trade deficit, like India has with China or other nations, it is not a big figure. According to him, it is important to look at the whole picture that is created by this agreement.

Overall, this agreement remains progressive and it will keep refining itself to make trade easier for both the nations.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

India focuses on 40 nations to drive up exports, pins hope on revival of global demand

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The Department of Commerce and the DPIIT are working together to use Invest India, Indian missions abroad and several territorial divisions to focus on increasing exports to 40 countries which account for 85% of Indian exports. With headwinds still continuing in trade in the first two months of the current financial year due to slowdown and recession in many countries, Commerce Secretary Sunil Barthwal said that WTO data is showing a reduction in import demand by OECD countries even as India is banking on WTO’s revised projection of 1.7% growth this year.

While EPCs (Export Promotion Councils) have told the government that demand will pick up once the accumulated inventory starts getting picked up, Barthwal pointed out that a 35.41% fall in India’s total trade deficit for April and May 2023 shows a much higher decrease in imports than exports. India’s imports from China have fallen 7.2% year-on-year in April and May 2023.

Describing the fall in trade deficit as a positive sign of India being able to contain imports more than the fall in exports, he said that strategic teams have been asked to focus on countries and product groups where there’s a revival of demand even as India hopes for demand to rise from its major importers.

However, he described the global demand situation as grim in view of stagnant demand in China’s construction sector, major defaults and debts in many African countries and a currency crisis in many south-east Asian countries.

With the US Federal reserve keeping its rates unchanged and western nations facing high inflation, as high as 11% in Europe, Barthwal expressed hope of a pick-up in industrial activity if Fed rates came down.

Noting a fall in demand for finished products, he explained that if inflation cools down in the US and rates are cut, demand is expected to pick up along with industrial activity.

Pointing to a rise in Indian exports to Italy despite disturbance in Europe due to an ongoing Russia-Ukraine war, he stated that the trade balance has tilted in India’s favour with a fall in imports of gold and silver as well as a 4.01 percent growth in year-on-year services exports in April-May 2023 to $51.14 million.

While a 7 percent year-on-year growth has been noted in services exports for April 2023, the Commerce Ministry termed the statistic as bright while describing April as a slowdown month compared to March, where companies try to better their numbers by the end of the financial year.

Expressing satisfaction with the results of PLI schemes in electronics manufacturing, the Commerce Ministry said that the impact of PLI schemes is being seen in both export promotion as well as import substitution. The government is looking to forge alliances for investment and trade by taking part in global fairs like the World Food Show and the world spice conference for buyer-seller meets and for exhibition of Indian products.

Also read: India’s goods trade deficit hits a 5-month high in May

With a focus on export promotion and import substitution being looked at in cohesion and not isolation, the government is looking to bring out an export strategy for this year, and intends to disclose the set targets once the volatility in the global market settles down.

Having witnessed a decline in merchandise imports except electronic goods, the Commerce Ministry said that the trade data for April and May saw a rise in imports of tur and urad dal due to low production and realised greater price on basmati rice exports.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Trade financing gap is restricting growth and negatively impacting sustainable development goals, says expert

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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International economy determines international trade, and international trade is greatly intertwined with international trade finance. Trade finance is the grease that keeps the wheels of international trade moving.

The global economy is expected to grow at less than three percent and likewise, international trade volumes are also expected to fall to less than 1 percent after a decent growth last year. Therefore challenges are aplenty.

In an interview with CNBC-TV18, Steven Beck, Head of Trade Finance at Asian Development Bank (ADB), said one of the primary reasons for the trade financing gap getting larger is inflation. He believes increasing trade financing gap is restricting growth as well as negatively impacting sustainable development goals.

Also Read: India announces new Foreign Trade Policy 2023

“Trade is critical for development, it has lifted millions of people out of poverty. However if we don’t have sufficient financing to back trade led growth then we are not going to be able to get the maximum development impact, the maximum gains that we can from trade,” he said.

“However there are substantial gaps in trade financing and it is getting larger with time. One of the primary reasons for the gap getting larger is inflation. Financial institutions have a country limit to support trade, but the value of that limit has in real terms has reduced because now the value of the transactions has gone up substantially,” he added.

“The country limits to support trade have not increased, in fact if anything a lot of financial institutions have reduced their exposure and that has exacerbated the whole situation with respect to trade financing gap. It is something we need to be concerned about because it is hitting our ability to grow and to reach our sustainable development goals,” he further said.

Watch video for entire discussion.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

DGFT amends ‘Stock and Sale’ authorisation policy for SCOMET items 

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The DGFT has amended the authorisation policy for “Stock and Sale” of the Special Chemicals, Organisms, Materials, Equipment, and Technologies (SCOMET) items with immediate effects.

The existing stock and sale policy has been amended to revise the applicability of the policy for export from the Indian subsidiary of foreign company (applicant exporter) to its foreign parent/another subsidiary of foreign parent company and allow repeat order authorisation under the Stock and Sale policy, DGFT said.

As per a notification issued by DGFT, “In exercise of the powers conferred under Paragraph 1.03 of the Foreign Trade Policy, 2015-20. the Director General of Foreign Trade, hereby makes amendments to Paragraph 2.79A (Stock and Sale) of the Handbook of Procedures (HBP) of the Foreign Trade Policy (FTP) 2015-20, with immediate effect.”

Also Read: Finance Minister Sitharaman seeks restriction on imports of platinum alloy

According to the government sources, the move aimed at enabling ease of doing business reduces the need to apply for SCOMET licence if repeat orders are being done to parent/group companies.

As per the new changes, applications for grant of authorisation for bulk export of SCOMET items from an Indian exporter to an entity abroad for subsequent transfer to the ultimate end users shall be considered by IMWG. However, no authorisation needed for transfer from stockist to end user within stockist’s country while re-export to end users in approved countries is subject to export control rules of stockist’s country.

The notification further said that the Indian exporters will have to submit details of such transactions with DGFT with bill of entry within 3 months of transfer.  IMWG to consider export authorisations to allow re-export, re-transfer based on end use verification.

Country would denote an independent sovereign entity which is a distinct national entity in political geography. Hence, transfers within an economic union or a customs union would not qualify as “same country transfers”.

The Indian exporter (Stock & Sale Authorisation holder) shall submit a statement of exports made from India to the stockist, transfers made by the stockist to the final end-users and inventory with the stockist, as on 31st December of each calendar year, by 31st January of the following year. Failure to do so may entail imposition of penalty and /or cancellation of authorisation under the stock and sale policy, DGFT said.

Also Read:  Govt to take decision on lifting wheat export ban in March-April: DGFT chief

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow