Next week’s Nairobi Ministerial Conference (MC) of the WTO is critical for India. First of all, the trade promoting body doesn’t have a serious issue as its pre-ministerial work programme indicates. So far not much preparatory discussions were conducted on any of the trade matters. Secondly, the WTO has to t settle India’s food subsidy issue by the eleventh MC. Hence India may get an opportunity and sufficient time at the MC to its pressing demand for giving food procurement a concessional treatment. Commerce Minister Nirmala Sitharaman has asked the WTO to honour decisions taken at Bali on food procurement. "The grievance is that many things which are part of th
India has made its climate support commitment that the country is ready to reduce the use of coal if the West provides finance and technology in renewable energies. The willingness to reduce coal use is a breakthrough at the Paris climatic talk. At present, India coal is the largest energy source for India and it is the leading user of coal. “We have made it very clear that solar and wind are out first commitment. Hydro, nuclear-all of these non-carbon sources are what we will develop to the largest extend that we can. What cannot be met by these will be met by coal,” Ajay Mathur, negotiator of the country stated at the Paris Conference. Coal provides nearly two third
The new hero in the international currency market- renminbi (RMB) will not undergo sudden changes according to its manager the People’s Bank of China (PCB). Speaking after the acquisition of RMB’s international status, Mr Yi Gang, deputy governor of PCB, said that the IMF decision was a validation of his country’s reform efforts. He ensured that the reforms will continue though there will not be sudden changes in renminbi. “There is no basis for continued yuan depreciation,” he added. China is following some sort of a managed floating of its currency and controls the value of renminbi vis a vis the US Dollar. The PCB allows RMB to move within 2% on e
The International Monetary Fund has decided to include China’s Renminbi (RMB) as a reserve currency under the SDR basket of currencies. RMB’s inclusion in the SDR currency basket gives a symbolic status to the China currency. A debate about the inclusion of RMB in the currency basket was going on over the last few years. In the IMF, the Quota review about the currency composition of the SDR basket was made few months ago and the Fund has postponed the decision on RMB, urging China to make further reforms on the currency and financial liberalization front. Beijing has devised many political measures to promote the internationalization of RMB. It has adopted pressure ta
Prime Minister Narendra Modi who is supposed to bear the symbolic leadership of the third world at Paris COP 21 has made a strongly worded statement that the developed world should shoulder more responsibilities to save the planet. In an article with the Financial Times of London, Prime Minister provided heat to the Paris Conference saying that “Developed countries benefited from fossil fuel and they should shoulder the burden of climate protection more.” Modi’s aggressive and yet bold stand may influence the outcome of the Paris Conference. According to him, the advanced countries that “powered their way to prosperity on fossil fuel” must continue t
The IMF in its Asia Economic Outlook predicts that Chinese economy’s more than expected deceleration is an economic risk for developing Asia including India. At the Asia’s Economic Outlook Conference speech made by Mitsuhiro Furusawa, Deputy Managing Director of the IMF says that Renminbi regime shift will have ripple effects. China’s downward correction of its currency may produce competition to exports from rest of Asia. Trade volumes are coming down across Asia. India last month has reported consecutive decline in its export for the eleventh month. According to the Commerce Ministry, exports from the country may fall below $300 bn mark for the first time sin
The upcoming Nairobi Ministerial Conference (MC) of the WTO may not produce any substantial achievements given the trends of pre-MC meetings. Usually preparatory discussions are conducted by members. There are groups within WTO just like-minded formations on each issue. Current trends on trade discussions before the Nairobi MC show that agricultural trade liberalization continues to be the prime area of conflict. There are several pressure groups in agricultural trade. The G33, Cairns Group, EU and the USA are the leading ones. Reports indicate that the G33, including India has come with a hard stand on the use of Special Safeguard Duties. G33, which is also called &
India has demanded governance reform of the World Bank (WB) by raising the shareholding by the developing countries at the Plenary Meeting of the WB-IMF Development Committee. The World Bank is facing fund shortages to implement its ambitious development programmes including climate financing and realizing the Sustainable Development Goals. Development Committee is the ministerial-level forum or decision making body of the World Bank Group and the IMF together, for intergovernmental consensus-building on development issues. India has a multi country representation as the Finance Minister represented a constituency consisting of -- Sri Lanka, Bangladesh and Bhutan besides India
The much anticipated biggest rules in international taxation- the OECD designed and G20 promoted BEPS (Base Erosion and Profit Shifting) Project is coming into the final stages. World’s leading finance ministers at the leadership of the G20 agreed on Friday to create international and domestic laws for taxing profits; giving warning to MNCs that they should end tax avoidance practices. BEPS project is a set of international tax rules proposed to counter the widespread tax avoidance practices by big MNCs. The companies use tax loop holes, concessions and Double Taxation Avoidance Treaties (DTATs) to escape from taxation. This has frustrated governments and more than that, cit
The mega trade bloc that the world was continuously talking on during the last few years – the Trans Pacific Partnership (TPP) is going to be materialized. The New York Times has reported that the Obama administration and the partnering countries have reached consensus on TPP. If implemented, the TPP will be the largest trade bloc in recent history, comprising 40 per cent of the world GDP in twelve countries, but remarkably excluding China. The TPP is a WTO plus trade alliance that aims to liberalise trade to advanced level between the US and eleven other members of the group. Besides economics, the TPP bears considerable value as it is considered as an alliance betwee
Dictionary on Indian Economy
- Logic of withdrawing Rs 1000 and Rs 500 notes
- Why the GST reform is transformational?
- Raghuram Rajan: The Gladiator returns to Chicago
- Good intention but poor thinking - what troubles demonetization?
- India Black Money Report: CBI underestimates black money at Rs 25 lakh crore
- High interest rate rather than inflation is the macroeconomic problem for India right now
- Japan’s first trade deficit in 30 years is part of the Global Shift
- Arvind Subramanian rocks with 'Chakravyuha' in Economic Survey
- Why we need an emergency monetization plan as well?
- NREGS: give respect to the tax payer’s money