The earnings momentum has been quite resilient and the policy momentum quite focused towards improving the infrastructure and attractiveness in the global supply chain: Daniel Blake of Morgan Stanley US-headquartered brokerage Morgan Stanley on Tuesday said India is its Number 1 market in the Asia Emerging Market (EM) pack. The earnings momentum has been quite resilient and the policy momentum quite focused towards improving the infrastructure and attractiveness in the global supply chain, said Daniel Blake, Asia and EMs strategist, Morgan Stanley, during a media briefing on 2021 Mid-Year Asia Strategy Outlook. The brokerage expects India’s earnings growth will see a huge jump in 2022 which will bring down the price-toearnings multiples. Morgan Stanley is currently overweight and underweight on six countries in the EM pack.
Source: Business Standard
UK begins 14-week stakeholder talks, India too engaged in internal consultations Formal negotiations between the UK and India on the proposed Free Trade Agreement (FTA) will not begin immediately as both countries will spend the next few months to gather inputs from all stakeholders including businesses, consumers and concerned Ministries and Departments, sources have said……………..
Source: Business Line
In April, the finance ministry eased rules for capital expenditure by government departments to try to boost spending in the economy. Pressure also is building on the central bank -- which serves as the banking sector regulator -- to ease loan repayment rules, especially for sectors badly hit by this virus wave. India is preparing a stimulus package for sectors worst affected by a deadly coronavirus wave, aiming to support an economy struggling with a slew of localized lockdowns, people familiar with the matter said. The finance ministry is working on proposals to bolster the tourism, aviation and hospitality industries, along with small and medium-sized companies, the people said, asking not to be identified as the deliberations are private. The discussions are at an early stage and no timeline for an announcement has been decided, they said. A finance ministry spokesman declined to comment. The latest wave of Covid-19 infections has made India the global hotspot for the pandemic and has decimated travel since the second wave picked up in March even though Prime Minister Narendra Modi has refused to implement a strict nationwide lockdown. With very high daily cases, many local governments — including India’s most industrialized states — have imposed curbs against the spread of the virus. That’s prompted many economists to cut their forecasts for the nancial year that began April 1, as rising unemployment and dwindling savings among consumers dim the chances for double-digit growth. While the International Monetary Fund expects India’s economy to expand 12.5% this year to March— and will be revisiting the forecast in July— the country’s central bank projects 10.5% growth. Modi’s administration doesn’t have enough scal room to maneuver even though it received about $14 billion from the Reserve Bank of India as dividend. That will mean, stimulus will most likely be in the form of tax breaks, according to Teresa John, economist at Nirmal Bang Equities Pvt. “The government doesn’t have too much leeway, although the recent RBI dividend provides some cushion,” said John. “The stimulus may be mostly additional guarantees and tax concessions, maybe demand boosting measures once opening up starts. All these may not involve a large government spending.” Flagging growth prospects put the onus on policy makers to support activity, especially once the virus caseload eases. Finance Minister Nirmala Sitharaman, who said last month she’s monitoring the economy in a “very detailed fashion,” has held discussions with economists in recent days about a stimulus package, the people said. “We expect the government to stick to its overall budgeted spending, while shifting its expenditure composition more in favor of health services and food subsidies,” said Bloomberg Economics’ Abhishek Gupta. The proposals are being drawn up at time when the rupee has emerged as Asia’s top performing currency from its worst on signs that India’s virus crisis may be easing after infection numbers hit a record 4,14,118 on May 7 due to localized lockdowns. India’s stock benchmark is also approaching a record-high close reached in February. In April, the nance ministry eased rules for capital expenditure by government departments to try to boost spending in the economy. It also decided to allocate ve kilograms of free food to the poor per month as the lockdowns saw millions of migrant laborers ee urban areas and back to their rural homes. But Sitharaman’s hands are restrained given India aims to lower its budget gap to 6.8% of gross domestic product in the financial year to March 2022, from an estimated 9.5% last year, signaling little legroom for New Delhi to ease purse strings in a significant manner. Pressure also is building on the central bank — which serves as the banking sector regulator -- to ease loan repayment rules, especially for sectors badly hit by this virus wave.
Source: Economic Times
However, for the full fiscal year, they see economy contracting 7-8% India’s economy is likely to have grown 0.6-2.1 per cent in the fourth quarter of the fiscal year 2020-21 (Q4FY21), said independent economists and leading rating agencies surveyed by Business Standard, better than the government's prediction of a contraction. However, for the entire FY21, they see gross domestic product (GDP) contracting 7-8 per cent. The growth in Q4 is led by widespread recovery in volumes and also low base effect, while the full-year contraction is mainly on account of a lockdown last year, which shut the economy for months. The National Statistical Office .........
Source: Business Standard
The e-National Statistical Office (NSO) will release the GDP estimates for the March 2021 quarter and provisional annual estimates for the year 2020-21 on May 31. The country's GDP is likely to grow at 1.3 per cent in the fourth quarter of 2020-21 and may see a contraction of around 7.3 per cent for the full nancial year, according to an SBIresearch report 'Ecowrap'. The e-National Statistical Oice (NSO) will release the GDP estimates for the March 2021 quarter and provisional annual estimates for the year 2020- 21 on May 31. "Based on our 'nowcasting model', the forecasted GDP growth for Q4 would be around 1.3 per cent (with downward bias) as against NSO (National Statistical Oice) projection of a negative (-)1 per cent," the research report said. "We now expect GDP decline for the full year (FY 2020-21) to be around 7.3 per cent (compared to our earlier prediction of minus 7.4 per cent)," it said. NSE -0.04 % (SBI) has developed a 'nowcasting model' with 41 highfrequency indicators associated with industry activity, service activity, and global economy in collaboration with State Bank Institute of Leadership (SBIL), Kolkata. The report said that going by the estimate of 1.3 per cent GDP growth, India would still be the fth-fastest-growing country among 25 nations that have released their GDP numbers so far. It said one likely consequence of any upward revision in FY21 estimates is a concomitant decline in FY22 GDP estimates. "Our estimates now indicate that there might be nominal GDP loss of up to Rs 6 lakh crore during Q1 FY22 as compared to loss of Rs 11 lakh crore in Q1 FY21," it said. Real GDP loss would be in the range of Rs 4-4.5 lakh crore and, hence, real GDP growth would be in the range of 10-15 per cent (as against RBI forecast of 26.2 per cent), it said. The research report further said both deposits and credit of all the banks declined in April and May. However, the trend in deposits has changed from FY21. Deposits had increased by a staggering Rs 2.8 lakh crore in 2020-21; and in the current nancial year, it has already increased by Rs 1 lakh crore till May 7. "The interesting point to note is that deposits have shown alternate periods of expansion and contraction in FY22 in the first three fortnights," it said. According to the report, it is possible that such expansion, followed by contraction, could indicate household stress as people getting salary credits in the rst fortnight are withdrawing it in the second fortnight for health expenses. They are also stocking up currency for precautionary motive and an uncertain scenario, and the trend continues.
Source: Economic Times
It said India is home to about 6.3 crore micro, small and medium enterprises (MSMEs) which form the backbone of the economy and the second wave of the pandemic has adversely impacted the sector. "In a time like this, we request the central and state governments to announce guidelines that will help sustain the livelihood of MSMEs," Federation of Indian Micro and Small & Medium Enterprises (FISME) said in a statement Industry body FISME on Tuesday suggested the central and state governments that MSMEs be allowed to do home delivery of products during the lockdown hours to help the sector grow during the COVID-19 crisis. It said India is home to about 6.3 crore micro, small and medium enterprises (MSMEs) which form the backbone of the economy and the second wave of the pandemic has adversely impacted the sector. "In a time like this, we request the central and state governments to announce guidelines that will help sustain the livelihood of MSMEs," Federation of Indian Micro and Small & Medium Enterprises (FISME) said in a statement. It also suggested removing "articial" distinction between essential and non-essential goods and that MSMEs should be allowed to sell all products by home delivery only. "This measure will help in ensuring jobs and continuity of economic activities. There shall be no restriction of intra state or inter-state movement of goods. No separate permission/epasses is required for such movements," it said. It further said states should treat e-commerce delivery personnel as frontline workers and accord priority to their vaccination. "Allowing the delivery of all products during lockdowns, removing regulatory hurdles to achieve this, enabling the ease of doing business and prioritising vaccination for delivery personnel are some of the ways in which authorities can provide an impetus to MSMEs," it said.
Source: Economic Times
Representatives of the state industry bodies had requested for a review of the terms of the extension of the lockdown “in view of many industries, including MSMEs and export units, being not able to sustain lockdowns in the current form which is causing extreme distress and financial burdens on their employees.” A state government decision on the joint request of the Karnataka state industry bodies for reopening industries with following strict COVID-19 appropriate behavior is expected shortly. The representatives of the Confederation of Indian Industry (CII), Karnataka, Bangalore Chamber of Industry and Commerce (BCIC), and the Automotive Manufacturers Association of India (ACMA), Karnataka and Hosur, made a joint representation to the chief minister B S Yediyurappa on May 22, 2021, to this effect immediately after the announcement of the extension of the lockdown. They requested for a reconsideration of the decision on lockdown “in view of many industries, including MSMEs and export units, being not able to sustain lockdowns in the current form which is causing extreme distress and financial burdens on their employees.” The joint team of Kamal Bali, former chairman, CII – Karnataka, T R Parasuraman, president, BCIC, and Satish Machani, chairman, ACMA – Karnataka, met the Chief Minister on Tuesday to apprise him of the situation. The team assured the Chief Minister that “all appropriate strict COVID-19 protocols will be followed by the industries. Further, the opening will give a big relief to all the industries. The team also assured the Chief Minister of the continued CSR support from industries in these challenging times,” a joint press release from the industry bodies said. They requested for a reconsideration of the decision on lockdown “in view of many industries, including MSMEs and export units, being not able to sustain lockdowns in the current form which is causing extreme distress and financial burdens on their employees.” The joint team of Kamal Bali, former chairman, CII – Karnataka, T R Parasuraman, president, BCIC, and Satish Machani, chairman, ACMA – Karnataka, met the Chief Minister on Tuesday to apprise him of the situation. The team assured the Chief Minister that “all appropriate strict COVID-19 protocols will be followed by the industries. Further, the opening will give a big relief to all the industries. The team also assured the Chief Minister of the continued CSR support from industries in these challenging times,” a joint press release from the industry bodies said. The chief minister thanked the industry captains for the support and expressed to review the opening of the industries in a phased manner with strict COVID-19 protocols. Yediyurappa also referred to the growing COVID positive cases in rural Karnataka recently and was hopeful of bringing the same under control in the next few days, the release said. Kamal Bali said “Clearly, there is a complete alignment in the prime objectives of the government and the industry in terms of saving lives, livelihoods and ushering in growth. The CM was assured of the industry’s compliance to COVID appropriate protocol and behaviour. Considering all these imperatives, the CM assured us of a favorable decision on our request very soon.” T R Parasuraman said, “The chief minister along with the industry minister and his team are doing a commendable job in these difficult times. I am sure given the current situation, the CM will review and open the industries at the earliest while doing a fine balancing act between saving lives and livelihood.” Satish Machani, said, “The CM and administration have displayed exemplary leadership in these unprecedented times. On behalf of ACMA, I informed the CM that if Karnataka halts, India halts and in fact, even the world will get impacted as we are all linked. The CM was very understanding and we hope to receive an order which balances lives and livelihoods. We promised to follow all protocols .
Source: Economic Times
The steep fall during the auction on Monday was due to the fact that Goa, Gujarat, Himachal Pradesh, Punjab, Telangana, Uttar Pradesh and West Bengal did not turn up despite indicating that they were planning to raise Rs 9,600 crore. With large borrowing states not coming to the market or drawing down less than indicated amounts, states are seeing the cost of their debt falling nally, with the weighted average interest rate declining by 18 basis points to 6.74 at the auction of state government securities on Monday. Last week, the rate stood at 6.92 per cent. At Monday's level, the rate dierence between the G-Sec (Government Securities) and state development loans are still at a high of 77 bps. While the weighted average interest rate is 6.74 per cent for the states, the Centre pays only 5.97 per cent for 10-year bonds, according to an analysis by Icra Ratings Chief Economist Aditi Nayar. During the auction on Monday, six states raised Rs 11,500 crore, which was lower than Rs 14,600 crore indicated. The amount is nearly 37 per cent lower than the year-ago level and 21.2 per cent less than what was indicated for this week. So far, the issuance has trailed the indicated level in six of the eight weekly auctions held this scal. The cumulative issuance stands at Rs 59,700 crore, down 44.3 per cent compared to Rs 1,07,300 crore initially indicated for this period on an annualised basis, Nayar said. The steep fall during the auction on Monday was due to the fact that Goa, Gujarat, Himachal Pradesh, Punjab, Telangana, Uttar Pradesh and West Bengal did not turn up despite indicating that they were planning to raise Rs 9,600 crore. Bihar, Kerala and Sikkim, which had initially declined to participate in the auction, together raised Rs 4,000 crore. Maharashtra, Rajasthan and Tamil Nadu together borrowed Rs 2,500 crore. With a decline in the weighted average tenor to 13 years on Monday from 19 years last week, the weighted average interest cost for the states declined to 6.74 per cent from 6.92 per cent. During the auction, Rs 4,500 crore or 39 per cent of the issuance was in the 10- year bucket and longer tenors of 11-25 year while Rs 2,500 crore or 22 per cent was in the 5-6 year bucket. Accordingly, the spread between the 10-year weighted average state debt and the G-Secs yield stood at 77 bps, the same as on May 11. With a considerable decline in the weighted average tenor to 13 years from 19 years last week, the weighted average cost moderated by 18 bps to 6.74 per cent.
Source: Economic Times
Nobel Laureate says it is 'not clear at all' if bond markets would react negatively to moves to avert crisis. India’s government could be spending more to help its population of almost 1.4 billion weather the economic devastation from the country’s explosive second wave of Covid-19 infections, according to Nobel Laureate Abhijit Banerjee. It’s “not clear at all” that bond markets would react negatively to such moves made to avert “an ongoing series of crises,” said Banerjee, 60, who was co-recipient of the 2019 Nobel prize for economic science for his work on poverty alleviation. “I’m not sure the government is calling it right,” the Massachusetts Institute of Technology professor, who also chairs a Covid advisory council to the state of West Bengal, said in an interview from Paris. “Is it possible to spend an extra 2% of GDP on this right now? Probably - many countries have borrowed 10 times that amount, so why not?” India has yet to announce any major support measures this year as the government attempts to narrow the fiscal deficit, which widened to a record in the year ended March 31, leaving much of the heavy lifting to monetary policy makers. However, Prime Minister Narendra Modi’s administration is now involved in early preparation for a stimulus package, according to people familiar with the matter. Those discussions follow the implementation of local restrictions in some states and cities, including New Delhi and Mumbai, and as the country’s unemployment rate rose to a four-month high of nearly 8% in April. So far there’s no timeline for an announcement, the people said. Official numbers show that India’s ferocious second wave has slightly ebbed in recent weeks -- although public health experts believe those figures, particularly fatalities that now total more than 300,000, are a dramatic undercount. Yet with India’s vaccination campaign stuttering and the country recording more than 200,000 new Covid cases each day, policy makers are already warning of a potential third wave. Banerjee believes the horrors of the latest outbreak, which saw widespread oxygen shortages and a collapse of its health system, means India won’t just assume it has beaten Covid following statements to such effect from government officials earlier this year, including Modi himself. “This one was so disastrous that it actually may remain in peoples’ minds longer,” he said. “The government is being more careful to say there will be a third wave. All of those might mean that people remain more careful after the lockdown is lifted.” Even with India’s total infections nearing 27 million, Banerjee doesn’t believe the South Asian nation is close to herd immunity. After devastating India’s biggest cities, the virus is now ravaging the rural hinterland where about 70% of the population lives with limited access to decent clinics, hospitals or health care. “Lots of places remain relatively untouched, and that remains the basis for another wave,” said Banerjee, who hopes the crisis will spur meaningful improvements to India’s health network. “There’s a tendency in the health-care system to favor opening fancy hospitals, which can be kind of newsworthy, over trying to do little things in little health centers.” India’s total spending on health has remained almost stagnant at around 1.5% of gross domestic product in the last four years. The government is projecting an increase to 1.8% this financial year and to 2.5% by 2025. One aspect of the pandemic that has puzzled Banerjee has been the strength of India’s stock market, with the current Covid crisis so far failing to spark a deep stock sell-off like the one seen last year. The BSE Sensex Index has advanced 6% this year. The pandemic has also done little to dent the confidence of overseas investors, including BlackRock Inc., who are betting on a strong rebound. “I must say I don’t understand it,” he said. “I really have a hard time reading why in a generally demand-constrained economy, what must be a substantial demand-earnings shock, especially among the poor, is not having a bigger effect. Clearly, some of it is that the global money is skittish, but it seems to think that India is still a good place to bet on.” Even so, Banerjee demurred on giving a detailed outlook on India’s economy.
Source: Business Standard
The rupee has staged a strong comeback, rebounding to become Asia’s top-performing currency from its worst on signs that India’s virus crisis may be easing. India’s currency has climbed 1.5% against the dollar in May to beat all its regional peers as the nation’s daily infections decline rapidly after touching a record high. The rupee also has the benefit of offering Asia’s highest carry returns.The revival in the rupee’s fortunes reflects India’s efforts to tackle the pandemic, with local lockdowns helping to rein in daily cases which were the world’s highest in April. Still, the central bank may be wary of a stronger currency given its adverse impact on exports at a time when the economy is emerging from a recession. “High carry and low volatility are making the rupee stand out” amid hopes that the worst of the virus wave may be over, said Anindya Banerjee, currency strategist at Kotak Securities Ltd. The Reserve Bank of India may step in at some stage to limit the currency’s gains, he added. The rupee tumbled to the lowest in nine months in April as daily coronavirus infections soared above 300,000, triggering the unwinding of up to $50 billion in carry trades. New cases dropped to 222,315 on Monday.The currency may also get a lift as investors convert dollars from a slew of upcoming initial public offerings into rupees. Online food delivery startup Zomato Ltd.’s $1.1 billion share offering is among the upcoming IPOs. Barclays Plc. expects the rupee to climb to 72.50 per dollar by next quarter from around 73 now owing to supportive flows, attractive valuations and a less interventionist RBI, according to a note published this week. Besides a more favorable trajectory of reported cases, the rupee has also drawn in speculative funds by offering the highest carry trade returns in the region.“A lot of the appreciation is due to the revival in carry trades,” said Bhaskar Panda, senior vice president, Treasury Advisory Group at HDFC Bank. Earlier, the unwinding happened as there was a trigger in terms of higher cases. “Now, they are re-positioning.”
Source: Business Standard
Trade with EU falls 23% from 2018 as Brexit and Covid disrupt exports from Britain China has replaced Germany as the UK’s biggest single import market for the first time on record, partly fuelled by demand for Chinese textiles used for face masks and PPE, official figures showed. Goods imports from China to the UK increased by 66% since the start of 2018 to £16.9bn in the first quarter of 2021, the Office for National Statistics said. Imports from Germany fell by a quarter over the same period, to £12.5bn. The European Union as a whole remains the largest trading partner for the UK. China was the first large economy to recover from the pandemic and the only big country to achieve growth in global trade last year. Imports to the UK were also lifted by heightened demand for Chinese electrical goods during lockdown. Germany had previously been the UK’s most dominant import market since modern records began in 1997, with the exception of six months at the end of 2000 and the beginning of 2001, when more was imported from the US. The ONS said imports from Germany had been in decline since April 2019, coinciding with Brexit uncertainty and previous EU exit dates. The Covid-19 pandemic has also weighed on German car production and exports worldwide. UK sales dropped in January because of the closure of car showrooms during lockdown. The figures also showed UK trade with the EU collapsed by nearly a quarter at the start of 2021 compared with three years earlier, as Brexit and Covid-19 disruption hit exports. Total trade – which includes imports and exports – in goods with EU countries fell by 23.1% in the first three months of the year, compared with the first quarter of 2018 before the pandemic began and before Brexit uncertainty became marked. Trade with countries outside the EU fell by just 0.8% over the same period, a trend that reflected the impact of new border checks on exports to the continent under the Brexit deal agreed between Boris Johnson’s government and Brussels. Six months on from the end of transitional arrangements with the EU, in a report published to assess the impact on trade of the pandemic and Brexit, the ONS said there was evidence of disruption at the start of the new trading relationship as activity around ports dropped and UK exporters struggled with new paperwork. Exports to Ireland suffered the sharpest proportionate decline among the UK’s top partners, while falls were also consistent across Germany, France and the Netherlands. The prime minister has insisted that disruption to EU trade is due to short-term “teething problems” that can be overcome in time as both sides adapt to the new trading relationship, while seeking to strike new trade deals with other countries around the world. However, business leaders say that Brexit comes with permanently higher costs, with consequences for the wider British economy. Naomi Smith, the chief executive of the pro-EU campaign group Best for Britain, said businesses were losing money and facing higher costs. “They’re struggling to cope with costly red tape imposed on them by the government’s last minute, bare-bones deal with the EU. For them, promises that trade with other countries would ride to the rescue have not materialised,” she said. The drop in exports at the start of the year comes after a rush in stockpiling by UK firms at the end of 2020 to avoid border disruption. Trade declined in January as businesses held back from moving goods and ran down existing supplies, before activity gradually picked up. The ONS said that while it was difficult to disentangle the Brexit impact from the fallout from the pandemic, companies had struggled with the consequences of Britain leaving the EU in recent months. According to the report, the number of companies reporting Brexit as their main challenge rose at the start of the year – replacing Covid-19 as the biggest problem for the largest proportion of businesses surveyed by government statisticians. Among firms that have exported in the past 12 months, 38% said extra paperwork had been a challenge to exporting since February. This has remained the case to April. Exports of food and live animals to Ireland faced the greatest number of new checks, culminating in a decline of 65.9%, about £300m, between December and January.
Source: The Guardian
Vietnamese products, including various farm produce, were on display at the 7th African Investment and Trade Forum (AFIC7) held in the Algerian capital city of Algiers on May 24 and 25. The event, via both video teleconference (VTC) and in-person form, was organised under the patronage of Algerian President Abdelmadjid Tebboune. The Vietnamese delegation to the forum was led by Ambassador Nguyen Thanh Vinh. The forum featured an exhibition, seminars and business-to-business meetings in the fields of food industry, agriculture, technology, tourism, services, renewable energy, and others. The Embassy and Trade Office of Vietnam in Algeria set up a booth, among a total of 70, at the event which showcased a number of Vietnamese flagship agricultural products, such as coffee, tea, rice, pepper, milk, “banh trang” (rice paper wrappers) and cassava powder, and materials promoting Vietnam’s culture and tourism. Around 20 domestic enterprises also joined the event virtually from Vietnam. Speaking at the forum, Vietnamese Trade Counsellor Hoang Duc Nhuan briefed audience on Vietnam’s economic development; the relations in trade, investment and agriculture between Vietnam and African countries; and the two sides’ potential cooperation in the coming time. He also announced Vietnam plans to host an international conference on Vietnam-Africa partnership in agriculture at the end of this year via VTC and in-person meetings. AFIC 7 was attended by numerous international and global organisations, embassies, trade offices, and more than 600 enterprises from 35 countries worldwide who are seeking export and investment opportunities in Africa. Trade between Vietnam and Africa totaled US$7.4 billion in 2019, with Vietnam’s shipments worth US$3.4 billion, an increase of 17% from the previous year. Vietnam’s main export items to Africa include mobile phones and parts, computers and parts, textile and garment, footwear, rice, coffee, pepper, cashew nut and fisheries products. Imports, meanwhile, comprise raw cashew nut, cotton, wood, copper, cattle feed and liquefied natural gas. Vietnam has invested close to US$3 billion in 12 African countries in the areas of oil and gas exploration and production, telecommunications, hydropower, and manufacturing of cement and wood, among others.
Source: Nhan Dan
The Dhaka Chamber of Commerce and Industry (DCCI) is expecting the government of Bangladesh to cut tax rates in phases for the next three years. The chamber has sought 2.5 per cent rate cut in the country’s national budget for fiscal 2021-22, an additional 2.5 per cent in fiscal 2022-23, followed by another 2.5 per cent in fiscal 2023- 24. The chamber recently submitted a plan to the National Board of Revenue (NBR), suggesting tax rate cuts in the next three budgets, according to Bangladeshi media reports. The corporate tax for non-listed firms was reduced to 32.5 per cent from 35 per cent in the last fiscal budget, while the tax rate for publicly traded companies continued to be at 25 per cent. However, the corporate tax rates in the country are higher in comparison to the neighbouring countries like India (25.2 per cent), Pakistan (29 per cent), Sri Lanka (28 per cent), Vietnam (20 per cent), Indonesia (20 per cent) and Myanmar (20 per cent). The DCCI has also suggested reducing the time taken to process VAT rebates for businesses from three months to one month. It is also rooting for an exemption from paying VAT at source for businesses that pay 15 per cent VAT. An exemption on advance tax on import (AIT) of industrial raw materials and capital machinery has also been proposed by the chamber. Bangladesh government will announce the budget for fiscal 2021-22 on June 3. The size of this budget is likely to be Tk 6 trillion.
Source: Fibre2Fashion
Continuing the recovery initiated in the third quarter of 2020, international merchandise trade for the Group of Twenty (G20) reached record levels in the first quarter (Q1) of 2021, the Paris-based Organization for Economic Cooperation and Development (OECD) said on Tuesday. Compared with the previous quarter, exports and imports for the G20 increased by 8.0 percent and 8.1 percent respectively, said the OECD. "With the exception of the United Kingdom, all G20 economies recorded positive growth in Q1 2021, with the depreciation of the U.S. dollar and the related increases in commodity prices playing a role in the recovery from the COVID-19 lows," it said. China, the G20's largest merchandise trader, saw exports up 18.9 percent and imports up 19.0 percent in Q1 2021. "Chinese import growth was led by metals and metal ores, cereals and integrated circuits, while export growth was led by electronic products including integrated circuits, vehicles, and textiles (including face masks)," said the thinktank. Argentina, Australia, Brazil and South Africa, among the G20's largest exporters of agricultural commodities and metals, saw their exports soar benefitting from the rising prices of these commodities. The nearly 35-percent increase in crude oil prices in Q1 translated into the rising export values of Canada, Russia and Indonesia. Since energy products are a major import for most G20 economies, the price increases also resulted in higher import values in the same period, according to the OECD quarterly report. In the European Union (EU), exports and imports grew by 3.8 percent and 5.0 percent respectively over the period. Germany, the bloc's leading power, saw its exports growing by 4.4 percent and imports up by 4.3 percent. The UK was the only G20 economy to record negative merchandise trade growth, both for exports and for imports in Q1 2021. The slowdown follows large increases in the previous quarter, when stockpiling was taking place in view of the exit from the EU Single Market, according to the OECD.
Source: Xinhua
