India and China 27 Apr 2015 by Tojo Jose

Chindia is here with Tata investment in Xiaomi

Chindia is here with Tata investment in Xiaomi

China’s ace phone maker Xiaomi’s announcement that Tata group has invested in the company is a big news.  For Tata, the investment is a support for Xiaomi’s indianisation efforts. At the same time, China being the Tata owned JLR’s largest market, the investment is a trust creating one.  The Xiaomi investment thus will better the phone company’s future in India as well as Tata’s future in China. For most, Xiomi is going to take Samsung in the global market in the coming year. Already, it has emerged as the second largest selling smart phone brand in China, defeating Samsung. Now, an important event is the launch of Letv video streamin

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India and China 09 Apr 2015 by Tojo Jose

China’s ‘one belt’ to travel beneath Mt Everest to reach Nepal

China’s ‘one belt’ to travel beneath Mt Everest to reach Nepal

China is planning to construct a railway line to Nepal from Tibet passing through a tunnel beneath Mt Everest. The China Daily has revealed few details about the proposed network that is going to be completed by 2020 at ‘Nepal’s request’. The rail network will produce the first time in history connect between Chinese mainland and Indian sub-continent across the high altitude Himalayas. China has already constructed Karakoram highway through Pakistan. But the turbulence in the region is making it a high risk route for the Chinese. If completed, the Himalayan rail network will be an easy entry point for Chinese goods into India. Besides, the railway line will g

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Trade 04 Apr 2015 by Tojo Jose

New trade policy is a departure from the past

New trade policy is a departure from the past

The new trade policy announced by the Commerce Minister Ms Nirmala Sitharaman has certain new features compared to the previous ones. First, the policy clubs both goods and service trade. This is for the first time that the Trade Policy makes a combined target. As per the new policy, the government aims to realize an export target of $900 billion by 2020.   All existing incentives to the export sector has been put under two schemes –Merchandise Exports from India Scheme (MEIS) and Services Exports from India Scheme (SEIS) for goods and services respectively. Export incentives which are usually expressed as the duty or tax credits given to the exporters in terms of

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India and China 06 Mar 2015 by Tojo Jose

China enters into the moderate growth phase

China enters into the moderate growth phase

Chinese economy has entered into a new normal but moderate growth phase in its transformation journey to become a developed economy. The new moderate growth is quite slower than the explosive 10 percent growth it has achieved for nearly thirty years till 2010.  Premier Li Keqiang has told the Parliament that for this year, the Chinese government is expecting a growth rate of 7. This is below the Indian growth rate for the year.   Traces of the new and the inevitable moderate growth phase were appearing for the last several quarters. The economy was growing at 7.5% from 2010 onwards. In 2014, the growth rate was lower than the projected growth. Li has described the new

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Trade 11 Dec 2014 by Tojo Jose

Benefits from crude fall

Benefits from crude fall

As crude prices dipping to the new lows, it is certain that the price fall will bring gains to importing countries like India. So far, crude continues to fall and reached below $65 mark for the Brent quality on Wednesday. Though price may reach at new lows, expectation is that it may settle at $75-80. In this context, there is scope for considerable economic gains for oil importing countries. For India, crude oil import bill was $165 billion during 2013-14 according to the RBI’s provisional estimate. It accounted for 36% of the total import of $450 bn. According to the World Bank, average crude price during 2013 calendar year was $104. If the price settles at $75 dolla

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Foreign Investment 04 Dec 2014 by Tojo Jose

Japan vs China technological race to build bullet train network in India

Japan vs China technological race to build bullet train network in India

A Babu in the railway can reserve an AC seat for his dog. Similarly, he is getting a monthly emolument to appoint a Sepoy to bear his bag. Not just these prevailing practices, but also the quality of Indian Railway’s infrastructure has not changed since the British left. Indian Railway is yet to get Independence. When the rest of the country is progressing, railway should change from the British era in every respect.  On this, the proposed bullet train will be a game changer for the national carrier. A bullet train travelling at 300 km/h speed will take you from Delhi to Chennai in just six hours. Government has planned two bullet train networks- one from Mumbai to Ahm

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Foreign Investment 04 Oct 2013 by Tojo Jose

Jet-Etihad deal cleared by CCEA

Jet-Etihad deal cleared by CCEA

The Cabinet Committee on Economic Affairs (CCEA) has cleared the controversial 2057 corore foreign direct investment by Abu-Dhabi based Etihad in domestic airline Jet Airways. The CCEA has approved the investment after the decisive Sebi clearance couple of days back. Etihad’s 24 percent investment was earlier objected by SEBI as the regulator found the agreement provided more than proportionate right for the foreign investor in Jet Airways. As per the SEBI’s sanction, Etihad now will not have promoter’s right with 24 per cent stake. This means Jet will continue as the promoter and control will be with it. The earlier agreement was structured on the line that wit

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Trade 01 Oct 2013 by Tojo Jose

External sector worsens during the first quarter with export decline and import rise

External sector worsens during the first quarter with export decline and import rise

The first quarter data on current account of the country published by the RBI shows that the trade situation is far from improving. Current account deficit which shows the sum of goods and service trade indicate that during April-June 2013, current account deficit widened to 4.9 % of the GDP compared to 3.6 % during the last year (first quarter). A notable element of current account deterioration is the decline in exports accompanied by 4.7 percent increase in imports. The RBI data also highlighted that capital inflows improved to $21 billion compared to 16 billion during the previous year. The non-improving trade data is rising call for the government and the RBI to launch s

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Foreign Investment 18 Sep 2013 by Tojo Jose

Rupee’s next fitness text

Rupee’s next fitness text

The rupee has spent a happy week so far amidst positive domestic and international turnarounds. So far, the national currency has made a smart come back from near to the edge of 70 per dollar to 63.4 within a week and couple of days time.  A positive trade data has pulled the currency first, followed by some surprising policy indication by Dr Raghuram Rajan. An aborted Syrian intervention and softened crude prices produced relief. Weak US employment data strengthened Rupee’s confidence in the market. As per the SEBI data, one out of every five foreign investors who have flown during the last three months has returned. This is felt in the stock market even. Despite no

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Trade 15 Sep 2013 by Tojo Jose

Govt. comes out with Duty Drawback push to extract gains from the depreciated rupee

Govt. comes out with Duty Drawback push to extract gains from the depreciated rupee

The government has come out with some timely export promotion measures to utilize the opportunities of a depreciated rupee. As a fresh measure, the Duty Drawback scheme is better incentivized to allow exporters to refund or claim the different taxes they have paid-excise, customs and services, in the production of the exportable commodity. As per the change, the rate for duty credit has increased and more items are included under the scheme to promote export production. According to the Ministry of Finance, the new will come into effect from September 21. The restructuring of the scheme by including more commodities and increasing the tax credit rate will reduce the prices of exp

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