The government plans to handhold the industry to help them familiarise with adequate documentation that they need to maintain for the Remission of Duties or Taxes on Export Products (RoDTEP) scheme-related reimbursements, a senior government official said. This is because last year, the United States (US) and the European Union (EU) had imposed countervailing or anti-subsidy duty against some products as retaliation against India’s export boosting scheme. The RoDTEP scheme allows refunds of the embedded non-creditable central, state and local levies paid on inputs to exporters and is compliant with World Trade Organisation (WTO) norms.
Source: Business Standard
Negotiations for a free trade agreement between India and the four-nation EFTA bloc are at an advanced stage as both sides have reached a shared understanding on key issues, a senior official has said. The European Free Trade Association (EFTA) members are Iceland, Liechtenstein, Norway, and Switzerland. India and the EFTA have been negotiating the pact, officially dubbed as Trade and Economic Partnership Agreement (TEPA), since January 2008 to boost economic ties. "Following extensive negotiations, a shared understanding has been achieved on key issues during the ministerial meeting. Ongoing efforts are now focused on shaping the convergence that has emerged," the official said. Commerce and Industry Minister Piyush Goyal held a meeting recently with Swiss Federal Councillor Guy Parmelin in Mumbai. Parmelin, in a social media post on X, has said that officials are working around the clock to settle last details so that it can be signed as soon as possible. "At the last-minute invitation of my Indian counterpart @PiyushGoyal, I travelled directly from the WEF in Davos to Mumbai/India. After 16 years of negotiations, we found balanced solutions to the main open issues of the EFTA-India trade agreement," Parmelin has said. The last round of talks between the countries concluded on January 13 here. Negotiations are held on various chapters, including trade in gods, rules of origin, intellectual property rights (IPRs), trade in services, investment promotion and cooperation, trade and sustainable development, and trade facilitation. EFTA has 29 free trade agreements (FTAs) with 40 partner countries, including Canada, Chile, China, Mexico, and Korea. Under free trade pacts, two trading partners significantly reduce or eliminate customs duties on the maximum number of goods traded between them, besides easing norms to promote trade in services and investments. EFTA countries are not part of the European Union (EU). It is an inter-governmental organisation for the promotion and intensification of free trade. It was founded as an alternative for states that did not wish to join the European community. India's exports to EFTA countries during 2022-23 stood at USD 1.92 billion against USD 1.74 billion in 2021-22. Imports aggregated at USD 16.74 billion during the last fiscal compared to USD 25.5 billion in 2021-22. The trade gap is in favour of the EFTA group, according to the data of the commerce ministry.
Source: Business Standard
Synopsis Border tensions, the biggest irritant to relations between the nuclear-armed Asian giants, have eased, which could lead to improved investment ties, top industrial policy bureaucrat Rajesh Kumar Singh told Reuters on Wednesday at the annual World Economic Forum meeting in Davos, Switzerland. India could ease its heightened scrutiny of Chinese investments if the two countries' border remains peaceful, a senior Indian official said in the first signal that the four-year-old curbs could be lifted. Border tensions, the biggest irritant to relations between the nuclear-armed Asian giants, have eased, which could lead to improved investment ties, top industrial policy bureaucrat Rajesh Kumar Singh told Reuters on Wednesday at the annual World Economic Forum meeting in Davos, Switzerland. In 2020, India tightened scrutiny on investments from companies based in countries it borders, adding a layer of vetting and security clearances. The move was widely seen as retaliation for a clash between Chinese and Indian troops on their disputed, 3,800-km (2,400-mile) Himalayan frontier that killed at least 20 Indian and four Chinese soldiers, their worst military conflict in decades. The curbs have disrupted billions of dollars of investments between the world's two most-populous countries, halting planned projects including from Chinese automakers BYD and Great Wall Motor. The investment rules "could change once our relationship there stabilises because I think the border issues that we've had - the border has stabilised", Singh, secretary at the Department for Promotion of Industry and Internal Trade, said in an interview. "On the investment side also, if things go well, I'm sure we can resume normal business." He did not give a timeframe for a possible easing. Asked if India's message was that Chinese investments depend on a peaceful border, Singh said, "You can't have somebody nibbling at your border while at the same time having red-carpet treatment for investments from there." The investment curbs, he said, were a slight "step back" from India's broader opening to foreign investment in recent years. India has significantly reduced hurdles for inbound investment, lowering or scrapping foreign ownership caps in many sectors and granting automatic approvals. China's foreign ministry responded to Singh's comments on Friday, saying the resolution process of the border situation should not affect the normal development of relations between both countries. "China has always believed that the China-India border issue is an issue left over from history and should be placed in an appropriate position within the bilateral relationship and properly handled," ministry spokesperson Mao Ning said when asked at a regular news briefing. Mao added that China hopes that India will "fully understand the mutually beneficial nature of China-India economic and trade cooperation" and sought from India a "fair, just, transparent and non-discriminatory business environment" for Chinese companies to invest and operate there. Despite the border problems, China is India's largest source of imports, with bilateral trade rising 32% since tensions flared to nearly $114 billion in the fiscal year that ended in March. Indian and Chinese troops clashed twice in 2022 even as peace talks were ongoing. New Delhi and Beijing, which fought a brief border war in 1962, have held a series of diplomatic and military talks to resolve the conflict. The two neighbours must find a way to step back from potential confrontation in the western Himalayas, Indian Foreign Minister Subrahmanyam Jaishankar said in June. But, Singh said, "In the last year or so, there haven't been any incidents. So I'm expressing the general hope from the business community that things will, you know, stabilise and improve." A mechanism to review foreign investments from all countries, resembling those in the United States and Australia, is an option India could eventually consider, Singh said, adding no decision has been taken as India would want to maintain a "welcoming environment" for investments.
Source: Economic Times
The finance ministry has widened the ambit of financial services that can be undertaken at the International Financial Services Centre (IFSC) to include book-keeping, accounting, taxation services and “financial crime services” that include those rendered in relation to the compliance of anti-money laundering measures.
Source: Economic Times
As general elections draw nearer, the Prime Minister's Office (PMO) has reviewed the progress of the proposed free trade agreement (FTA) with the United Kingdom (UK), according to people in the know. Top officials from the commerce department made a presentation on Wednesday about contentious issues in the proposed FTA, sources said, adding that negotiations had reached a stage where a ‘political call’ was needed to fructify the proposed deal. The 14th round of negotiations in New Delhi between India and the UK began on January 10. “The negotiation is at a crucial stage and was scheduled till 19 January, although both countries
Source: Business Standard
Amid rising hostilities in the Red Sea due to Houthi attacks, Fitch Group said South Asian economies would be most affected. They will experience the largest relative increase in maritime trade distance, shipping time, and costs as the crucial trade route remains inaccessible. It added that India’s economic forecast faces a significant risk in the event of a prolonged spell of disruptions. “If Red Sea disruptions were to persist, the resulting downward revisions to our India and Bangladesh forecasts will probably be significant and would dent our 4.0 per cent growth forecast for Asia in 2024,” BMI, a unit of Fitch Group, said in its commentary. All these matter because we expect India and Bangladesh, two of the most vulnerable economies to Red Sea shipping disruptions, to outperform in terms of gross domestic product growth this year, it said. The Red Sea is a key maritime shipping route linked directly to the Suez Canal, which substantially reduces the maritime trade distance between Europe and Asia and carries a significant 12 per cent of the global trade. The crisis has caused major movements in the container and ocean freight markets, sparking fears of inflation across the world. Last week, India’s commerce department said attacks by Houthi rebels have resulted in a combined impact of higher freight costs, insurance premiums, and longer transit times. The impact can make imported goods significantly more expensive. The Department of Financial Services, under the finance ministry, has been asked to monitor that exporters are given smooth credit to keep trade volatility in check. According to the Drewry World Container Index, container prices have nearly tripled since the start of the maritime crisis to $3,777 for a 40-foot equivalent unit container as of January 18. The rates are 23 per cent higher than last week. Freight rates between China and the US swelled by 35 per cent in the space of a week, with similar surges seen across maritime routes. “As the six-day blockage in 2021 as well as the eight-year closure of the Suez Canal in 1967-1975 (due to the Six-Day War and the Yom Kippur War) show, disruptions to shipping through the Canal and the Red Sea can have a major impact on global trade. The blockage, for instance, held up an estimated $9 billion in trade for each of the six days it lasted,” Fitch said.
Source: Business Standard
DHAKA - Textile workers in Bangladesh have been promised a pay rise following reports of vandalism in factories by disgruntled employees struggling to make ends meet. They point out that garment workers were awarded a 56% increase from the start of December, taking their minimum wage from BDT 8,000 ($75) a month to BDT 12,500 ($114).
Source: Eco Textiles
ISLAMABAD: Pakistan’s exports of non-textile value products saw a contraction in the first half of 2023-24 from a year ago. The negative growth was observed despite an increase in the country’s main exports of textiles and clothing in the same period, according to data compiled by the Pakistan Bureau of Statistics. In the July-December period, the exports of leather garments fell by 9.71 per cent year-on-year in FY24. The decline was noted in both leather garments and gloves. The exports of raw leather also decreased by 23.17pc during the period under review. The export of carpets and rugs declined by 21.61pc in 6MFY24. The export of sports goods also declined 2.35pc led by a 21.9pc dip in footballs’ shipments. Pakistan is one of the main suppliers of global surgical instruments. However, the export value of these instruments remained negligible during July-December FY24 over the same months last year as these are re-marketed in Western countries by famous brands. At the same time, the export of footwear contracted by over 16.49pc in July-December FY24 from a year ago. Footwear is one of the sectors which saw a growth in exports in FY23. However, the export of engineering goods witnessed an increase of 3.12pc in 6MFY24 from a year ago. The export of jewellery surged by 46.53pc in the first half of FY24 from a year ago, followed by a 30.09pc rise in the export of gur and gur products. However, the export of gems declined by 26.52pc, furniture 44.14pc, molasses 73.86pc and handicrafts 53.03pc. Contrary to a slump in FY23, the cement exports jumped 58.77pc in 6MFY24. Petroleum crude exports remained zero, whereas the foreign shipments of petroleum products surged 228pc. The start of 2023-24 saw a continued downward trend in the export of value-added products, significantly impacting non-textile products as well. However, the exports of food products posted robust growth during the period under review turning many essential food commodities particularly beef, chicken and rice beyond the reach of consumers. The export proceeds from the non-textile sector had been stagnant since the beginning of FY24.
Source: Dawn
Vietnam’s textile and garment industry are pushing for a bilateral or free trade agreement to alleviate export taxes and to expand their presence in the Canadian market. Despite securing the third-largest exporter status for textiles and garments in Canada, there is an opportunity for growth. Currently holding a 12 per cent market share in Canada’s imports, Vietnam attributes its success to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Two Vietnamese companies, VEG and Thái Sơn Co, showcased their commitment to CPTPP’s origin principles at a recent textile exhibition in Canada. To boost further development, the industry is urging for reduced export taxes through a new agreement. VEG, having exported around US $ 10 million worth of goods to the US in 2023, plans to establish additional branches in Canada, capitalizing on favorable tax conditions. However, challenges persist, with the majority of domestic businesses falling short of CPTPP requirements for fiber material origin. The President of the Canadian Apparel Federation, Bob Kirke, suggests a free trade agreement between Vietnam and Canada to address CPTPP shortcomings. As Vietnam targets $44 billion in textile and apparel exports for 2024, collaboration and potential regulatory adjustments hold the key to enhancing competitiveness in the global market.
Source: Apparel Resource
