National News

AP Govt in talks with VPT to develop Machilipatnam Port

HYDERABAD:The Andhra Pradesh State Government has intensified efforts to rope in Visakhapatnam Port Trust (VPT) as the developer of the Machilipatnam deep seaport, high-placed sources associated with the talks on selecting the new developers said recently. First-stage talks with VPT were completed in early July.Meanwhile, the State Government has dropped Navayuga Construction Company Limited as the developer of the Machilipatnam Port, cancelling the concession agreement signed in June 2010, according to a Government order issued by the Department of Industry, Infrastructure, Investment and Commerce.

India, Russia to boost ties to achieve USD 30 bn bilateral trade by 2025: Piyush Goyal

NEW DELHI:India and Russia have called for diversifying and deepening of economic ties in priority sectors to meet the bilateral trade target of $30 billion by 2025, the Commerce Ministry said recently. This was emphasised upon by Russia’s Deputy Prime Minister Yuri Turned and Commerce and Industry Minister Piyush Goyal during a business session from August 11-13 in Vladivostok, Russia.A delegation including Chief Ministers of Haryana, Gujarat, Uttar Pradesh and Goa and about 140 Indian companies was led by Goyal at the session.He urged companies of both countries to discuss partnerships directly and come up with concrete project proposals.The Ministry said in a statement that a number of MoUs were signed between regions of the Russian Far East and five States of India to expand and strengthen cooperation in the areas of trade.

Mandate for ‘Made in (country)’ tag declaring place of origin for imports to India under contemplation

NEW DELHI:India is contemplating making it mandatory for imports into its borders to bear a ‘Made in (Country)’ tag declaring their place of origin. This is one measure to come to grips with large scale dumping and entry of sub-standard goods, besides also giving a fillip to local manufacturing. It is timed with New Delhi implementing country-specific trade restrictions such as high tariffs on certain American goods.Work began on the ‘non-preferential rules of origin’ that would apply to imports from countries that do not have a trade agreement with New Delhi such as the US, European Union, China, New Zealand and Australia ad this plan is part of that work. “These rules are being drafted,” a senior government official said recently.Rules of origin exist under India’s free trade or preferential trade agreements but none for imports under the general route or most favoured nation category. The non-preferential rules are used for policy measures like anti-dumping and countervailing duties, trade embargoes, safeguard and retaliation measures, quantitative restrictions but also for some tariff quotas and for trade statistics. These rules help Customs authorities effectively discharge their duties by checking imports thatre not upto quality standards or are in violation of any trade norms. This additional requirement will help them verify the certificate of origin of goods from the country of origin as declared by the importer.

Plan to start container train from Suranussi, Jalandhar underway jointly between CONCOR and Indian Railways

FEROZEPUR: Container Corporation of India Ltd. – CONCOR – a Navratna PSU of the Ministry of Railways and Indian Railways are forging a partnership to begin a container train from Suranussi, near Jalandhar in the Ferozepur Division of Northern Railway, affirmed T. P. Singh, General Manager, Northern Railway during a Press Conference at Ferozepur. On 12th August 2019 at a glittering ceremony a land license agreement was signed between Railways and CONCOR at Ferozepur Division. It was graced by T. P. Singh, General Manager (Northern Railway), Rajesh Aggarwal, DRM, Ferozepur, Sanjay Swaroop, Director International Marketing and Ops, CONCOR, Kamal Jain, Executive Director CONCOR (Northern Region) and other senior officers from the Railways.This will boost the transportation of domestic and export-import cargo in containers from the catchment areas of Jalandhar, Hoshiarpur, Kapurthala and Amritsar. In March 2019, a trial of this this container rail terminal was taken by CONCOR during which a total 540 TEUs (Twenty Equivalent Unit) containers requiring six container trains were handled. CONCOR transported 12,690 metric tonne of cargo to various parts of country on a multi-modal basis. Mr. Sushil Kumar, Sr. Div. Engineer-II, Ferozepur Div. and Mr. Vineet Mathur, Chief Manager, CONCOR, Ludhiana signed the agreement on behalf of Railways and CONCOR respectively.

Goldman Sachs: Foreign capital inflows worth USD 13 bn already received by India so far in FY 2020

MUMBAI:Goldman Sachs India Securities confirms that India has already attracted USD 13 billion net foreign funds so far this year. It expects the trend to continue.”India has already attracted net capital inflows of about $13 billion so far this year which contrasts with net outflows of $11 billion last year and I expect that trend to continue,” the US broking firm’s Chief India Economist Ms. Prachi Mishra said in the latest episode of the firm’s Exchanges at Goldman Sachs podcast. She said Prime Minister Narendra Modi’s landslide victory in the general elections has in May this year has welled up foreign investors’ appetite for Indian assets. Mishra added that asset managers are hoping for and expecting sweeping structural reforms in areas like land use and labour that will boost growth, which will be possible because of the ruling party’s majority in Parliament. According to Mishra, average GDP growth in India over this decade has been about 7 per cent per annum, 75% of which is attributable to consumption.

Fiscal support to exporters: Finance, Commerce Ministries at loggerheads

NEW DELHI:Two ministries — Finance and Commerce and Industry, do not agree on fiscal support for exporters. Mr. A. B. Pandey, Revenue Secretary has pressed for withdrawing the Merchandise Exports from India Scheme (MEIS) at once after an alternative one for all export sectors is implemented whereas Commerce Secretary Mr. Anup Wadhawan has suggested a phased withdrawal, sources said. Introduced under the Foreign Trade Policy in 2015 the MEIS incentivises merchandise exports of more than 5,000 items now and is the biggest of its kind. Exporters earn duty credits at fixed rates of 2 per cent, 3 per cent and 5 per cent, depending upon the product.The Revenue Department has suggested strict closure dates of any new reward scheme for exporters without which it must be understood that the scheme will stay valid till the end of the fiscal year of their introduction, sources added. But the Commerce Department prefers to assess and seek financial allocation annually.Last week the Commerce Department floated a cabinet note for replacing the MEIS with the World Trade Organization-compliant Rebate of State and Central Taxes and Levies (RoSCTL) as one of the options. Only last month they canvassed for an additional 2 per cent on MEIS introduced in 2017 for a few months, as a transitionary measure.For apparel and made-ups sector, the RoSCTL is in place since March. The Textiles Ministry wanted to continue the MEIS simultaneously for a few months. However, the Revenue Secretary cited an expense of Rs. 51531 crore per annum and turned down the suggestion and sought the immediate withdrawal of MEIS after the RoSCTL or any other scheme was introduced, sources said.“While the Revenue Department wants the new scheme to be rolled out in three months, the Commerce Department has batted for a longer time frame and a staggered implementation to cover all export sectors,” said a Government source.Similar to MEIS the RoSCTL makes the Directorate General of Foreign Trade pass the benefit to exporters in the form of duty credit scrips. But unlike now, it will be IT-driven and will rebate all embedded State and Central taxes on paid inputs. This includes the value-added tax on petrol, mandi tax, electricity duty, and stamp duty on all export documents, among others.“It had been decided in Inter-Ministerial Meetings that the rate of scrips will be decided by the Duty Drawback Panel within three months of approval from the Cabinet,” a Government official said.

Increase bilateral trade by collaborating with Nepal Freight Forwarders Association: FFFAI

KATHMANDU:Mr. S. Ramakrishna, Chairman of Nepal Freight Forwarders’ Association urged for more collaboration between FFFAI and NEFFA to enhance bilateral trade. He was speaking at the Silver Jubilee Celebration function of Nepal Freight Forwarders Association (NEFFA) on July 29 in Kathmandu and made the following recommendations:

  • The federations work as a team to share best practices in either country.
  • Both federations should come out in the open with difficulties they face at each other’s borders. They must mitigate them by representing jointly to each Government for which FFFAI stands committed.
  • A meeting that will be attended by India, Nepal and Bangladesh must be held for inland waterways which will present a joint proposal to the three governments to extend the treaty. This treaty is already in place with Bangladesh but must now include Nepal too, especially for Jogighopa and Pandu Multimodal Logistics Parks being opened up in northeast India.
  • Both FFFAI and NEFFA should trust mutually and cooperate in helping each other in recoveries and settlement of payment issues.

As of now, freight forwarders in Nepal are concerned about the irrational charges levied by shipping lines operating container services on the Indo-Nepal route, including labour charges, additional surcharges and demurrage charges, thereby increasing logistics costs many times over. Other areas of concern are the congestion at dry ports and exorbitant registration charges to use of Government’s cargo tracking systems.On July 28 Mr Ramakrishna attended the India-Nepal Logistics Summit organised jointly by the Federation of Nepalese Chambers of Commerce and Industry (FNCCI), Ministry of Industry Commerce and Supplies and Maritime Gateway, in association with Nepal Freight Forwarders Association (NEFFA). Discussions on infrastructure developments, issues related to transit time between Nepal and Indian ports, warehousing facilities in Nepal, issues related to tariffs charged by logistics service providers and requirement of automation of customs and border clearance were held.

Additional claims under MEIS: DGFT notifies mechanism

NEW DELHI:In a notification the Directorate General of Foreign Trade (DGFT) suggested a mechanism to apply for additional claims under Merchandise Export from India Scheme (MEIS) for certain HS codes for which enhanced rates with retrospective effect were applicable. For exports from 1st November 2017 of certain HS codes the Directorate has notified higher rates during the mid-term review of the policy. “Certain exporters had realized payment for exports made on or after 01.11.2017 after having made exports under those HS Codes and have also claimed MEIS benefits from the Directorate, before the said Public Notices were notified,” said DGFT.In a trade notice, the DGFT has asked such exporters to claim the differential 2% rates as enhanced. The notice also said that any difficulties in implementing the mechanism must be brought to the notice of this Directorate.

Guidelines for schemes to promote MSMEs in NE India and Sikkim issued by MSME Ministry

NEW DELHI:Guidelines for the promotion of MSMEs in NE India and Sikkim have been issued by the Ministry of Micro, Small and Medium Enterprises (MoMSME) of the Central sector scheme “Technology and Enterprise Resource Centres”.The MoMSME which has been working in the country to develop MSMEs felt that those from NE India and Sikkim need special treatment. A special scheme for ‘Promotion of MSMEs in North Eastern Region and Sikkim’ was approved on August 02, 2016 with this in mind.A new Central Sector Scheme of “Technology and Enterprise Resource Centres” was formulated after merging four schemes viz. (I) Tool Room and Technical Institutions; (ii) Promotion of MSMEs in North Eastern Region and Sikkim; (iii) Infrastructure Support to MSME-Testing Centres / Testing Stations/ Training Institutes / Workshop & MSME Development Institutes (Field Institutes) and (iv) Capital Outlay on Public Works, and it was appraised by the EFC in its meeting held on January 16, 2018. It has been approved by them too.The sub-components of the scheme are to – Set up new and modernize existing mini technology centres; develop new and existing industrial estates; build capacities of officers along with some other activities. For example the scheme for setting up new and modernize existing Mini Technology Centres entails financial assistance to state governments for it. The assistance will be equal to 90% of the cost of machinery/ equipment/buildings, but not exceeding Rs. 10.00 crore. But these funds cannot be used for cost of land and building cost.

EICI: Express industry should get incentives from Draft National Logistics Policy

MUMBAI:Integral parts of the logistics network namely express industry and air-cargo sectors get left out of the draft National Logistics Policy document pointed out the Express Industry Council of India (EICI). It said “The Government has overlooked express industry, especially air cargo segment, in the draft National Logistics Policy.”Mr. Vijay Kumar, Chief Operating Officer, EICI said, “We laud the efforts in preparing the draft policy covering a broad spectrum of focus areas to drive the growth of Indian logistics sector. However, we note that the policy document does not focus on express industry and air cargo sectors, which are integral parts of the logistics network.”The multi modal mix too overlooks air express, an essential segment of the movement of goods, he added. He stressed that air cargo delivery needs special focus to reduce logistics costs in the country.He further added that, “In developing countries like India, an efficient air express infrastructure contribute directly to global competitiveness of the Country by ensuring just in time deliveries and reduced clearance dwell time.Further, efficient express delivery industry acts as an economic catalyst by opening up new market opportunities, moving products and services with speed and efficiency”.The draft National Logistics Policy has been issued by the early this year with the aim of reducing logistics costs from 13-14% of GDP to 10% “in line with best-in-class global standards.”

RO-PAX Vessels for Inland Waterways Authority of India launched by Cochin Shipyard

KOCHI:On 8th August 2019, the Cochin Shipyard launched two Ro Pax vessels designed and built by them for Inland Waterways Authority of India. Senior officials of IWAI and Directors and employees of Cochin Shipyard attended the ceremony. The vessels were launched at the hands of Dr Ms. Asha Paul, W/o Shri Mathew George, Director, IWAI and Smt Mini C, W/o Shri Suresh Babu NV, Director (Operations), CSL. These are the third and fourth vessels in the 10 vessel order from IWAI for whom CSL is building 8 Ro Pax vessels and 2 Ro-Ro vessels.CSL was selected by IWAI for the construction of these vessels as they are to ply in strategic locations in National Waterways 1&2. The vessels can accommodate 2 trucks, 84 cars, 200 passengers and will have 8 crew members. It is equipped with all the lifesaving equipment’s and is built as per the IRS standards.The Company signed contracts for 4 of Mini Bulk Carriers with Utkarsh Advisory Services Pvt. Ltd. (Part of JSW group) for their Indian coastal operations, which will be delivered between August to December 2020. CSL has set up ship repair at Mumbai Port Trust under their ambitious expansion plans.

Exports to US of goods under tariff system up 32% despite GSP roll-back

NEW DELHI: Indian goods that were enjoying benefits under GSP the preferential tariff system to the US registered a 32% growth in June, according to Trade Promotion Council of India (TPCI). These benefits were granted by USA under its Generalized System of Preference (GSP) Programme. Effective 5th June, the US rolled back export benefits to over 1,900 Indian goods.According to the United States International Trade Commission (USITC) data Indian exports to the US of goods earlier under GSP benefits stood at $657.42 million in June as compared to $495.67 million in the same period last year.In a statement, TPCI Chairman Mohit Singla said, “India’s exports to the US on GSP withdrawn products has registered 32 percent growth in June 2019 as compared to the same month last year.” His very interesting finding is that the growth covers USD 161.74 mn of the USD 190 million value of the GSP benefit claimed last year leaving only a thin margin of USD 28.26 million. Plastics rubber, base metals (aluminium), machines and equipments, transport equipment, hides and leather, pearls and precious stones are chief contributors towards this growth. This clearly indicates that contrary to perception Indian products do not solely depend on support but have the potential to compete globally, Singla said.TPCI has been a strong advocate of phasing subsidies and minimizing government support. New sunrise sectors like furniture and electricals need to be incentivised in his opinion. This can be done by creating a cluster-based mega ecosystem, which can churn the required export growth completely. Growths have flattened and therefore continued fixation of labour incentive sectors should be considered over. India exported goods worth $6.3 billion to the US in 2018 under their export incentive Programme.

Economic slowdown: Govt plans urgent steps to boost exports

NEW DELHI: The Government is weighing a raft of measures — including “full reimbursement” of various imposts on exports and relaxed lending norms to improve credit flow to reverse a slide in the growth of outbound shipments in recent months, sources said recently. While the Commerce Ministry has already circulated a Cabinet note to phase out the flagship Merchandise Exports from India Scheme (MEIS) with a more WTO-compatible regime under which various State and Central levies on inputs consumed in exports will be reimbursed, the Government will likely top it up with an assurance that all embedded taxes borne by exporters will be fully refunded.“The new scheme will be a dynamic one, so that all sorts of embedded taxes will be reimbursed once exporters bring them to notice. A Government panel will examine their demand and take appropriate action. The idea, as we have stated, is that exports must be zero-rated as per the global best practices,” a source said.Though the goods and services tax (GST) regime has subsumed a plethora of levies, some still exist (petroleum and electricity are still outside the GST ambit, while other levies like mandi tax, stamp duty, embedded Central GST and compensation cess etc remain unrebated). Similarly, the Reserve Bank of India (RBI) is willing to ease priority-sector lending guidelines for exporters. Currently, exporters with a turnover of up to Rs 100 crore each are eligible for credit under the priority sector norms. This limit is likely to be scrapped or doubled so that more exporters are benefited. The maximum sanctioned limit of loans is also likely to be raised to Rs 40 crore per borrower from the current Rs 25 crore. Even the cap on export credit at 2% of banks’ total loans could be relaxed soon.However, the Central Bank has refused to endorse a proposal to allocate a part of its foreign exchange reserves for export credit — as is being demanded by some exporters — to boost flow of loans on the ground that such a move is fraught with risks, a source said.Once tweaked, the revised priority sector lending norms and certain enabling guidelines are expected to release additional credit of anywhere between Rs 35,000 crore and Rs 68,000 crore for exporters, according to an RBI assessment. Recently, Commerce and Industry Minister Piyush Goyal told the Rajya Sabha that banks’ outstanding export credit, which rose from Rs 1,85,591 crore in March 2015 to Rs 2, 43, 890 crore in March 2018, dropped to Rs 2,26,363 crore at the end of March 2019.Goyal has already held a series of meetings with exporters to address their concerns, and some of the steps being mulled will be finalised soon. The measures are proposed at a time when India’s merchandise export growth collapsed to just 0.6% in April, 3.9% in May and -9.71% in June. Citing persistent risks from a global trade war, the IMF recently trimmed its 2019 trade growth forecast by a sharp 90 basis points from its April projections to 2.5%, against the actual rise of 3.8% in 2018.As for the plan to reimburse levies, such a scheme has already been implemented in garments and made-up exports. However, its scope and reach will be expanded now. Exporters will be refunded levies through freely transferable scrips. For the remission of State levies for garment and made-up exports, the Government had allocated Rs 3,664 crore in FY19. However, the compensation level under this scheme was expanded in March to include Central levies as well; even some embedded taxes were factored in.So the potential revenue forgone is now estimated at around Rs 6,300 crore annually. The Government’s potential revenue forgone on account of the MEIS is estimated at Rs 30,810 crore a year.However, Government officials have repeatedly stated that the entire allocation or potential revenue forgone on account of various such schemes (including MEIS) doesn’t qualify as export subsidies, as in most cases, they are meant to only soften the blow of imposts that exporters have been forced to bear due to a complicated tax structure. The US has dragged India to the WTO, claiming that New Delhi offered illegal export subsidies and “thousands of Indian companies are receiving benefits totaling over $7 billion annually from these programmes”. Indian officials have rejected such claims.According to FIEO President Sharad Kumar Saraf, for our exporters to become competitive, the Government needs to ensure that transaction costs are cut drastically, embedded taxes are fully offset, raw materials are made available at reasonable prices and credit is extended at cheaper rates. “Land acquisition needs to be made easier and companies must not be dragged into unnecessary legal hurdles,” he added.

APEDA: 10.6% dip in farm exports Q1 of current fiscal

NEW DELHI: In terms of value, farm exports dipped 10.6% in the first quarter of the current fiscal to Rs 28,910. For the same period last year they were at Rs 32,341 crore.APEDA, the nodal agency for promotion of agri exports, confirms from their data that basmati rice shipments from India have slipped from 1.17 million tonnes in the first quarter of 2018-19 to 1.15 million tonnes during the same period in this fiscal.“The major drop in exports, however, is in non-basmati rice and pulses which have gone down by around 50%. As against 2.1 million tonnes exports of non-basmati rice in 2018-19, Indian exported 1.2 million tonnes this year. Similarly, the exports of pulses have dipped drastically from 1.01 lakh tonnes in 2018-19 to 45,344 tonnes this year,” said an Agriculture Department official.On the other hand, exports of fresh fruits, processed vegetables and fruits and juices have grown over last year.“The focus is on ensuring doubling of farmer’s income by 2022. Farm exports would be major contributor to this cause. We have a well laid down Agri Export Policy. We have asked States to work on that to promote exports and increase farmers’ income,” the official said.

Removal of MEIS calls for alternate schemes from GoI urges TEA

TIRUPUR:Urging the government is the Tirupur Exporters’ Association (TEA) to bring out an alternative scheme similar to the MEIS with the same benefits after the closure of the Merchandise Exports from India Scheme (MEIS) to ensure continued growth of the readymade garments industry. It is being removed with effect from 1st August, 2019 under pressure from WTO, after the US lodged a complaint with it.The TEA in its appeal says that the MIES has been a lifeline supporting exports of readymade garments. The scheme was introduced to give a level playing field to some goods like readymade garments by offsetting the infrastructural inefficiencies faced by them. It cannot be denied that the cutting edge it gives is essential to stay afloat in the global market. The Indian exporters will lose their market to foreign companies. Hence, for readymade garment sector SOPs are required.Mr. Raja M Shanmugham, President, TEA said, “We wish to point out that the removal of MEIS will crumble the business created over a period of time. Non-addressing of some of the core issues, including arresting infrastructure deficiency, signing of FTA with the EU, CEPA with Canada, CECA with Australia and bringing down the interest rates will further put pressure on the industry.”

China News

China Renews Vow to Retaliate Against Planned U.S. Tariffs

BEIJING:Despite President Trump’s decision to delay implementing some of the levies, China renewed its vow to retaliate against U.S. tariffs set to be imposed in coming weeks, but expressed hope that the two countries would reach a resolution to the trade war.The U.S. proposal on Aug. 1 to levy new tariffs on $300 billion in goods “severely violated” a consensus reached between Mr. Trump and Chinese President Xi Jinping during their meetings this past year in Argentina and Japan, said the State Council’s Customs Tariff Commission on Thursday.An unnamed official was quoted as saying by the commission that the threatened new tariffs by the U.S. ‘deviated from the right track of resolving differences through dialogue’.The official added, “China would have no choice but to take necessary countermeasures.”China’s Ministry of Foreign Affairs, in a separate comment, expressed hopes that the two countries could reach an acceptable solution.The Foreign Ministry’s spokeswoman, Hua Chunying, said in a statement, “We hope the U.S. can work in concert with China to implement the two presidents’ consensus that was reached in Osaka, and to work out a mutually acceptable solution through equal-footed dialogue and consultation with mutual respect.”President Trump announced on Twitter on the 1st of August that he would impose a 10% levy on roughly $300 billion in Chinese goods on Sept 1st, an apparent response to what he described as China’s failure to commit to promised U.S. agricultural purchases.The response of Beijing was the official announcement of the freezing of purchases of U.S. agricultural products and letting its currency drop to its lowest level in a decade. A weaker yuan makes Chinese exports cheaper. The Trump administration on Tuesday postponed plans to impose tariffs on roughly half of the $300 billion in Chinese goods to Dec. 15 from the original Sept. 1 date, citing concerns over the impact on American businesses and consumers ahead of the holiday shopping season.

China’s Central Bank Reforms Rates to Boost Cheap Funding for Businesses

BEIJING:On Saturday, China’s central bank unveiled a long-awaited reform to its interest-rate mechanism. The aim of this move was the reduction of financing costs for businesses struggling due to a cooling economy. In a statement on Saturday, the People’s Bank of China said that it would replace existing benchmark interest rates with the Loan Prime Rate, which is based on real-world bank lending prices, as a reference for banks in pricing new loans.Previewed in remarks by the country’s central bank and the State Council, this move will better reflect real market lending rates and enable lenders to quickly respond to the central bank’s easing policies.For China’s smaller companies, which have been hardest hit by the economic slowdown but which enjoy only limited access to cheap funding, unlike their larger state-owned peers, policy makers are also hoping to substantially lower borrowing costs. While industrial production growth decelerated to its slowest pace in more than a decade, just days earlier, China reported an increase in the urban jobless rate to the highest-ever level on record. As demand for credit fell the central bank also reported a sharp pullback in new loans last month.Further adding to concerns about a further deceleration in the domestic economy, is China’s continuing trade war with the U.S., which shows no signs of abating.Beijing has turned to reform of the interest-rate mechanism to lower real lending rates for borrowers rather than slash interest rates, which policy makers fear could stoke more capital outflows.While large sums of money had already been into the banking system injected by China’s central bank this year in an attempt to lower lending rates, but because of an unwillingness by banks to lend to private companies, that liquidity largely failed to make it to smaller borrowers.Banks will submit to the central bank each month the price of loans offered to their best clients, which are tied to a PBOC-controlled medium-term lending facility under the new mechanism. The statement said that the central bank will use the average price of the loans to derive the LPR. Benchmark interest rates were previously used by banks to price the LPR.The first rate under the new mechanism would be released by the central bank on Tuesday and would be updated each month, it said.The change is likely to increase the efficiency of the central bank’s monetary policy, Ms. Chen Shujin, an analyst with Huatai Securities, said, but cautioned that this move alone wouldn’t resolve all the funding problems faced by small businesses, who also struggle to access bank credit.It would introduce a five-year LPR to serve as a reference for longer-term loans such as mortgages the central bank said, since the current LPR only provides a one-year rate.The new mechanism will not affect the existing bank loans, PBOC said.

China promises to address India’s concern over ballooning trade deficit

BEIJING:Promising to address India’s growing concerns over the ballooning trade deficit, China has recently suggested expanding cooperation in areas like industrial production, tourism and border trade to achieve “overall balance” in bilateral commercial relations.India has repeatedly voiced concern over The trade imbalance which last year crossed a whopping USD 57.86 billion over USD 95.5 billion total bilateral trade, has been a point of concern fr India. The trade deficit in 2018, according to the official Chinese data, climbed to USD 57.86 billion from USD 51.72 billion in 2017.External Affairs Minister S Jaishankar, mentioned the trade deficit issue during talks as well as during a bilateral event when he was here for talks with the Chinese leadership to prepare for the second informal summit between Prime Minister Narendra Modi and Chinese President Xi Jinping later this year in India.

As Trade War Rages China’s Economy Weakens on Several Fronts

BEIJING:Adding to evidence that the world’s second-largest economy is slowing further as it remains locked in a trade war with the U.S., China reported a raft of weak economic data In July, as employers turned cautious the jobless rate in Chinese cities returned to its highest level since regular reporting on the data began. Other key economic readings for the month, Including factory production, consumption and property investment, came in much lower than expected. Economists say the more-than-yearlong trade conflict with the U.S. has dented market confidence, forcing manufacturers to scale back production and investment, and prompting consumers to tighten purse strings although China earlier reported a surprise jump in exports in July,. “The cooling of economic activity last month was even worse than that of 2008 when industrial production was hit by the global financial crisis, while domestic consumption remained strong,” said Zhaopeng Xing, an economist with ANZ. In order to keep growth running at 6% to 6.5% in 2019, a target set by Chinese leaders earlier, extra stimulus policies will be necessary said Mr. Xing.Industrial production rose at its slowest pace since the beginning of 2009, increasing 4.8% in July from a year earlier compared with a 6.3% rise in June the National Bureau of Statistics said Wednesday.As car dealers finished unloading inventories ahead of new emissions standards retail sales—a gauge of consumption—rose 7.6% in the period, down from a 9.8% increase in June.“Today’s data demonstrated that the Chinese economy faces increased downward pressure that hasn’t been alleviated by the previous stimulus policies,” said Shuang Ding, an economist with Standard Chartered.Mr. Ding said growth-boosting measures are needed to keep the economy from spiralling out of control. China’s central bank—which reported weak credit data in July— he expects will lower interest rates for the medium-term lending facility, a monetary tool to provide funds for banks.Mainly cutting taxes and fees has shown little sign of success in Beijing’s strategy of stimulating growth so far, with economic growth decelerating to 6.2% in the second quarter, the slowest pace for the country in nearly three decades.Data from the statistics bureau showed urban unemployment shot up to 5.3% in July, matching a record high in February. It is a priority for Chinese leaders to tackle joblessness, who see a robust economy as the foundation to maintain Communist Party rule. China’s actual unemployment rate is far higher than official figures suggest many economists say.China International Capital Corp. said in a research report in July, the nation’s industrial sector has lost five million jobs in the past year, attributing 1.8 million to 1.9 million jobs losses to the trade war with the U.S.On Tuesday the Trump administration postponed plans to impose new tariffs on about $156 billion in goods from China until Dec. 15.Mr. Xing said the decision provides breathing room for some Chinese exporters who could rush shipments of Christmas orders in coming months. He expects China’s exports to remain buoyant in the next few months absent

Africa News

AfDB extolls Chinese commitment to improve Africa’s industrialization

The African Development Bank (AfDB) in Nigeria met a private sector consortium from China to help attract investment through partnerships in the development of special agro-Industrial processing zones (SAPZs) across Africa
Led by Professor Banji Oyelaran-Oyeyinka, Senior Special Adviser on Industrialization to the AfDB President, the delegation called on Nigeria’s Vice-President Mr. Yemi Osinbajo, who assured them of the tremendous investment opportunities in Nigeria. Development of agro-industrial parks with Chinese direct investments and partnerships with Nigerian agribusinesses as well as ventures with Nigerian state governments and agribusinesses was discussed.“Nigeria has the potential to become the food basket of the world, but this depends on our ability to deploy the right technology. Our partnership with you allows us to harness the knowledge and skills to realize this potential. We work with the African Development Bank at the highest levels to ensure that investors face no constraints in doing business,” Osinbajo said.Development of SAPZs quickly is a priority of the bank in line with its Feed Africa Strategy. Feed Africa is trying to draw the massive natural endowment of the sector into competitive advantages that create wealth and sustainable agribusiness jobs for African youth. The strategy will lrad to food security and inclusive growth by involving more women and youth and promoting improved resilience to climate variability and shocks.SAPZs is trying to radically transform Africa’s agriculture into a business-oriented and commercially viable sector that guarantees food self-sufficiency and put an end to food insecurity, malnutrition and other related challenges.AfDB’s Nigeria Country Director, Mr. Ebrima Faal praised China’s commitment to the development of the African continent since joining the Bank Group in 1985. “China has supported the concessional funding base of this institution over many years and is a major contributor to ADF-14. During the China Africa Cooperation summit in 2015, it pledged a US$60bn package to implement a 10-point cooperation plan with Africa. China also established the Africa Growing Together Fund, which became operational in November 2014 with US$2bn for 10 years alongside the Bank’s own resources to finance eligible projects in Africa,” he added.

Zambia’s energy generation supported by USTDA

Upepo Energy Zambia Limited, a Zambian energy solutions company has been given a grant by the US Trade and Development Agency (USTDA) for the feasibility study of a 150MW wind, solar and energy storage hybrid power plant project in northern Zambia.
This will entail an on-site study of the optimal mix of wind, solar and battery storage technologies will be made to generate to the Zambian grid. Once complete, it ill be the first hybrid power generation facilities in Zambia and will help add to its grid.New York-based WSP USA, Inc., technical and financial experts, has been chosen by UPEPO for analyzing the need to develop such large-scale hybrid projects and determine their commercial viability.USTDA’s Acting Deputy Director, Mr. Todd Abrajano while signing the grant in Lusaka, said, “This project will also serve as a gateway for the US technologies to serve an important sector in Zambia.” The US ambassador to Zambia Daniel L. Foote added, “This partnership with Upepo Energy is also a good example of the value brought by commercial cooperation between the United States and Zambia.”

Expansion in India-Africa network by Ethiopian Airlines

Ethiopian Airlines will add to its India and Africa network after introduction of Bangalore-Beira (Mozambique) route this fall.Stating October 27th, the Star Alliance member will launch 4X-weekly Addis Ababa-Bengaluru (India) services. It already had two flights daily to Mumbai and New Delhi, besides the dedicated freighter flights to and from Bengaluru. From 3rd September 3X-weekly Addis Ababa-Beira services will be routed via Malawi.“Covering the largest network in Africa and connecting major world trading cities across our global network, we have been filling the connectivity vacuum in the continent not only with primary cities in countries, but also with secondary and tertiary cities and towns,” Ethiopian Airlines Group CEO Tewolde Gebremariam said.Beira will also connect with the Ethiopian Mozambique Airlines hub in Maputo, Mozambique’s capital. Ethiopian Mozambique Airlines, one of Ethiopian Airlines’ African startup carriers, serves eight domestic destinations from Maputo namely, Nampula, Tete, Pemba, Beira, Nacala, Quelimane, Vilankulos and Chimoio. Separately, Ethiopian received its 25th Bombardier Dash 8 Q400, making it Africa’s largest Q400 operator.

Automated cargo clearing system rolled out by KRA

An automated clearing system for cargo called the Integrated Customs Management System (iCMS) has been rolled out by the Kenyan Revenue Authority (KRA). It was inaugurated at the Port of Mombasa on Saturday by clearing its first consignment of 43,400.835 metric tonnes of clinker.A consignment of clinker was offloaded from the vessel MV Ptolomeos which docked at the Port of Mombasa at 6.25 am on Saturday. Prior to its arrival the importer’s clearing agent Express Shipping and Logistics (ESL) had logged entries in the system and paid duty of Sh65 million. The clearing was done automatically while still in the high seas. Next bulk consignments that will meet the same fate are 42,000 metric tonnes of clinker that arrived at the port last Wednesday on board MV Boreas Venture and 25,540 metric tonnes of coal expected to arrive on next Wednesday by MV African Hoeg. The clearance process has been initiated by coal importer, Riftcot Limited by registering an import declaration form (IDF) to have the cargo released through the system. KRA expects to collect revenue of more than Sh40 million from the consignment.“Clearance of cargo through the new system is a major milestone for efforts by KRA to expedite customs clearance of cargo and enhance trade facilitation,” Commissioner, Customs and Border Control, Mr. Kevin Safari.“iCMS will reduce the cargo dwell time for compliant imports at the Port of Mombasa since the system does not require human intervention at the document processing centre, unlike the Simba system.”

Air Agreement with 27 African countries reviewed by FG

To allow for a review of air transport agreement between them and the Federal Government a total of twenty-eight African countries have signed the Single African Air Transport Market of the African Union. Mr. Edem Oyo-Ita (retd), Director of Air Transport Regulation of the Nigerian Civil Aviation Authority, marks it as a liberalisation of air transport and an opportunity for domestic airlines as well as the industry to grow. Countries like Benin, Burkina Faso, Botswana, Capo Verde, Central African Republic, Chad, Congo, Côte d’Ivoire, Egypt among others have signed the agreement. According to the International Air Transport Association, they represent over 80 per cent of the existing aviation market in Africa. After this agreement, many more carriers within the continent are expected to begin flight services into Nigeria.

World News

Shanghai Tops ranking of World’s Best-Connected Ports: UNCTAD

GENEVA:The Shanghai Port has topped UNCTAD’s 2019 ranking of the world’s best-connected ports, released on 7 August.The Chinese port garnered a connectivity score of 134 points, followed by the ports of Singapore (124.63 points), Pusan (114.45 points) in Korea and Ningbo (114.35 points), also in China. The index is set at 100 for the best-connected port in 2006, which was Hong Kong, China.Besides the Asian ports, the other ports on the top 10 list are those of Antwerp (94 points) in Belgium and Rotterdam (93 points) in the Netherlands. None of the ports in the top 20 list are from Africa, Latin America, North America or Australasia.“A container port’s performance is a critical factor that can determine transport costs and, by extension, trade ompetitiveness,” said UNCTAD’s Director of Technology and Logistics, Shamika N. Sirimanne.Efficient and well-connected container ports enabled by frequent and direct shipping services are key to minimizing trade costs and fostering sustainable development, Ms. Sirimanne said.UNCTAD’s port Liner Shipping Connectivity Index (port LSCI) dataset enables businesses and governments to determine maritime transport trends and their ports’ positions compared to others.More than 900 Ports covered The port LSCI, which now provides data on more than 900 ports dating back to 2006, is generated using the same methodology as that for the recently released country-level LSCI produced by UNCTAD in collaboration with MDSTransmodal.The 2019 port LSCI shows that the expanded Panama Canal has led to shifts in patterns of services.The data also indicates that the LSCI of New York/New Jersey and Savannah on the East Coast of North America grew by more than 20% since 2016, while the leading ports on the West Coast saw their LSCI stagnate.The data further reveals that investments by shipping lines can attract additional services. Piraeus (Greece), operated by COSCO from China, for example, has become the best-connected port in the Mediterranean in 2019.In Africa, both geography and port reforms emerged as critical factors. The best-connected countries in Africa are those at its corners – Morocco, Egypt and South Africa.Western Africa has relatively low connectivity because it doesn’t lie at the crossroads of major north-south or east-west shipping routes.Mombasa (Kenya) and Dar es Salaam (Tanzania) connect Burundi, Rwanda and Uganda to overseas markets through dedicated corridors, but they remain highly congested.Low connectivity makes merchandize trade costly and uncompetitive. Many small island developing states (SIDS) face a vicious cycle where low trade volumes discourage investments in better maritime transport connectivity.The Pacific Islands are among those with the lowest shipping connectivity. For example, Port Vila (Vanuatu) receives about one container ship every three days, the data shows.In Kiribati, there is only one operator offering regular liner shipping services, with one ship arriving about every 10 days. Port calls and port turnaround times Besides the new datasets measuring liner shipping connectivity, UNCTAD also released new data on port calls and turnaround time in the global container ports, in collaboration with MarineTraffic.The data shows that containerships have the lowest turnaround times.In 2018, a ship spent a median time of 23.5 hours in ports.Dry bulk carriers typically spent just over two days during a port call, while container ships spent the least amount of time – less than a day.“A shorter time in port is a positive indicator that could partly signal the level of port efficiency and trade competitiveness,” said UNCTAD’s Chief of Transport, Frida Youssef.The economies with the fastest turnaround times are the advanced ones with large volumes or small ones that handle low cargo volumes at each port call, Ms. Youssef said.According to the data, the bottom 10 Countries are all developing Countries or least developed Countries.However, a longer time spent in port does not necessarily mean that the port is less efficient, as owners of ships may choose to have them stay longer in a port to purchase goods or services.According to Ms. Youssef, Countries with more port calls have lower turnaround times. “A port with a faster turnaround can accommodate a larger number of port calls with the same number of births,” she said.Such a port is also more attractive to shippers and carriers, Ms. Youssef said, so the number of port calls will be higher compared to a competing port that has a lower turnaround time.These latest datasets complement other maritime statistics and indicators provided by UNCTAD to measure the achievement of the Sustainable Development Goals.

India, China no longer ‘Developing Nations’, won’t let them take ‘advantage’ from WTO: Donald Trump

WASHINGTON:US President Donald Trump has said that India and China are no longer “developing nations” and were “taking advantage” of the tag from the WTO and asserted that he will not let it happen anymore. Trump, championing his ‘America First’ policy, has been a vocal critic of India for levying “tremendously high” duties on US products and has described the Country as a “tariff king”.The US and China are currently engaged in a bruising trade war after Trump imposed punitive tariffs on Chinese goods and Beijing retaliated.Earlier in July, Trump asked the World Trade Organisation to define how it designates Developing-Country status, a move apparently aimed at singling out countries like China, Turkey and India which are getting lenient treatment under the global trade rules.In a memorandum, Trump had empowered the US Trade Representative (USTR) to start taking punitive actions if any advanced economies are inappropriately taking benefits of the WTO loopholes.Addressing a gathering at Pennsylvania, Trump said India and China – the two economic giants from Asia – are no longer developing nations and as such they cannot taken the benefit from the WTO. However, they are taking the advantage of a Developing Nation tag from the WTO, putting the US to disadvantage, he said.

Port of Rotterdam launches PortXchange to make Digital Shipping App Pronto available to Ports Worldwide

ROTTERDAM: The Port of Rotterdam Authority launched its new company PortXchange Products BV (“PortXchange”) on August 8th 2019. This entity is set up to offer the Pronto platform and application to ports around the world over the next few years. The establishment of a separate company will enable partnerships with a variety of global players. Together with strategic partners Shell International Trading and Shipping Company Limited (“Shell”) and A.P. Moller – Maersk, PortXchange will initially offer Pronto to several ports outside the Netherlands. The launch of PortXchange provides a platform to create new strategic partnerships with ports, shipping companies and terminals, geared towards implementing smart digital solutions like Pronto in ports worldwide. This in turn contributes to the ambition of Port of Rotterdam to become the world’s smartest port.
PortXchange
Trust between parties for the free exchange of data is vital to the successful introduction of Pronto in other ports. The establishment of a separate company enables the solution’s neutrality and independence, and improves cooperation between all parties.PortXchange aims to improve the efficiency of port calls and help clients reduce their emissions – both in the port as well as between ports. To this end, the company provides Pronto: a joint platform that can be used by shipping companies, agents, terminals, port authorities and other (nautical) service providers, which enables them to optimally plan, execute and monitor all activities during a port call based on the exchange of standardised data. In addition, Pronto enables just-in-time sailing, which helps reduce carbon emissions.
A smart port is a connected port
Taking the lead in digital transformation enables the Port of Rotterdam to become more efficient, reliable and, as result, more competitive.
Partnerships
The first Port change partnerships have already been signed – with Shell and A.P. Moller – Maersk. “Pronto will be offered in several ports in Europe and the US before the end of the year. The ambition for the years ahead is to make Pronto available to ports worldwide. Partnerships with major international players like Shell and Maersk play a crucial part in making pronto a global success,” said Allard Castelein, CEO, and Port of Rotterdam Authority.

Over 2,000 ships to install scrubbers this year to meet IMO deadline of Jan. 2020

London:Over 2,000 ships will install the so-called scrubbers during the course of this year that allows them to keep burning more-polluting fuel that will otherwise be banned as per the low-sulphur fuel regulation of IMO to be implemented from 2020. Much of the work will be done in the fourth quarter, threatening to drain capacity from the global fleet, said a report. The work is increasing before new rules from the International Maritime Organization that will curb the amount of sulphur oxides vessels can emit from January 2020. With ships able to keep using today’s cheaper fuel by installing scrubbers, a chunk of the global fleet will opt for that. Therefore, many carriers are likely to be out of service for weeks at a time from now through year-end for refits; good news for shipowners as those who charter vessels will find fewer available, the report added.

Shanghai is the world’s best-connected port

Paris :Shanghai port has topped UNCTAD’s 2019 ranking of the world’s best-connected ports, released last week.The Chinese port garnered a connectivity score of 134 points, followed by the ports of Singapore (124.63 points), Pusan (114.45 points) in Korea and Ningbo (114.35 points), also in China. The index is set at 100 for the best-connected port in 2006, which was Hong Kong, China.Besides the Asian ports, the other ports on the top 10 list are those of Antwerp (94 points) in Belgium and Rotterdam (93 points) in the Netherlands. None of the ports in the top 20 list are from Africa, Latin America, North America or Australasia. “A container port’s performance is a critical factor that can determine transport costs and, by extension, trade competitiveness,” said UNCTAD’s Director of Technology and Logistics, Ms Shamika N. Sirimanne. Efficient and well-connected container ports enabled by frequent and direct shipping services are key to minimising trade costs and fostering sustainable development, she added.UNCTAD’s port Liner Shipping Connectivity Index (port LSCI) dataset enables businesses and governments to determine maritime transport trends and their ports’ positions compared to others.Data from more than 900 ports covered from 2006 is available at port LSCI is generated with the same methodology as that for the recently released country-level LSCI produced by UNCTAD in collaboration with MDS Transmodal. For example the 2019 port LSCI shows that patterns of service have shifted after the Panama Canal has expanded. Or that there was a 20% growth since 2016 in the LSCI of New York/New Jersey and Savannah on the East Coast of North America but a stagnation on the LSCI of leading ports on the west coast. An underlying pattern revealed by the data is that investments by shipping lines can attract additional services. For example Piraeus in Greece, operated by COSCO from China is today the best-connected port in the Mediterranean in 2019.Geography and port reforms both have proven equally important factors in Africa. The countries in the corner of the continent are its best-connected countries namely Morocco, Egypt and South Africa. In comparison Western Africa has low connectivity because it does not lie at the crossroads of major north-south or east-west shipping routes. Mombasa (Kenya) and Dar es Salaam (Tanzania) connect Burundi, Rwanda and Uganda to overseas markets through dedicated corridors, but they remain highly congested. Merchandise trade becomes costly and uncompetitive with poor connectivity. A vicious cycle is when low trade volumes discourage investments and many small island developing states (SIDS) suffer this fate. An example of this is the Pacific Islands. For example, data shows that Port Vila in Vanuatu receives about one container ship every three days. In Kiribati, there is only one operator offering regular liner shipping services, with one ship arriving about every 10 days.

Port calls and port turnaround times.

UNCTAD has also released new data on port calls and turnaround times in global container ports in collaboration with Marine Traffic, which shows that containerships have the lowest turnaround times. The median time spent by a ship in a port in 2018 is 23.5 hours, dry bulk carriers spent a little more than two days during a port call and container ships spent the least at less than a day.“A shorter time in port is a positive indicator that could partly signal the level of port efficiency and trade competitiveness,” said UNCTAD’s Chief of Transport, Ms Frida Youssef. Ships from advanced economies have the fastest turnaround times with large volumes or small ones that handle low cargo volumes at each port call, Ms Youssef said. Data says that the lowest 10 countries are all developing or least developed ones. Longer times spent in port does not mean that a port is less efficient, as sometimes owners of ships may choose to have them stay longer in a port to purchase goods or services.According to Ms Youssef, lower turnaround times are experienced by countries with more port calls. “A port with a faster turnaround can accommodate a larger number of port calls with the same number of berths,” she said. She added that such a port is more attractive to shippers and carriers, so the number of port calls will be higher compared to a competing port that has a lower turnaround time.These latest datasets complement other maritime statistics and indicators provided by UNCTAD to measure the achievement of the Sustainable Development Goals, said a release.

Global container port demand to have modest growth: Drewry

LONDON:Shrouded in uncertainty, global container port demand is heading toward a modest growth and muted capacity expansion plans which means that most world regions will see increased average terminal utilisation, shipping consultancy Drewry said in its Global Container Terminal Operators report.Forecast for the next five years for global growth in container port demand is 4.4% per annum on average, meaning that world container port throughput will increase from 784 million TEU in 2018 to 973 million TEU by 2023, an increase of 190 mn TEU. The heady days of the 2000s when forecasts were around 9% growth per annum are over thanks to the global financial crisis of 2007-08. Many locations like the Middle East/South Asia and Southeast Asia/Far East Several may outperform the global average by a lot.Projections for global container port capacity are for an increase of 2% CAGR, based on confirmed additions only. This is well below the projected demand growth and reflects the continued easing off from Greenfield projects by investors over the last few years. This could result in average utilisation at the global level to increase significantly from 70% in 2018 to 79% by 2023, according to Drewry. At the regional level, almost all locations are projected to see their average utilisation levels increase, the shipping consultancy noted, adding that the sharpest upward swings are expected in Greater China and Southeast Asia, with the former hitting 100% by 2023.PSA and Hutchison take the number 1 and 2 slots respectively for being the top individual global/international terminal operators based on their performance, with PSA’s pre-eminence due to its 20% stake in Hutchison Ports. With a 30% growth boosted by OOCL acquisition, Cosco moved up to third place in 2018 from fifth in 2017, displacing DP World and APMT each by one rank to fourth and fifth places respectively. Following suite are China Merchants in 6th place with 35 million TEU and still in the 7th with 26.5 million TEU, even though they both recorded double-digit growth in equity-adjusted volume.“A premier league of seven big operators has emerged, after which the next largest player is a third of the size. Between them they accounted for nearly 40% of global throughput in 2018. Within this elite group, Cosco has moved sharply up the table in this year’s analysis,” Neil Davidson, Drewry’s Senior Analyst for Ports and Terminals, said.