Dec. 3 – After Ernst & Young ranked India as the most attractive investment destination in the world last week, strong quarterly growth figures indicate India’s economy is on track to expand by at least 5 percent in 2014.
In a press conference yesterday, Indian Finance Minister P. Chidambaram pointed to India’s decreasing account deficit, rupee stabilization, and rising exports as signs Asia’s third-largest economy is on the recovery path. Continue reading
Nov. 21 – The new issue of Asia Briefing Magazine, titled The 2014 Asia Tax Comparator, is out now and will be temporarily available as a complimentary PDF download on the Asia Briefing Bookstore throughout the months of November and December.
The opportunities to sell to the Asian consumer have never been more pronounced than they are today, and those opportunities will continue to expand and develop over the next three decades. Key to understanding and accessing this massive, dynamic new consumer market is the ability to understand the underlying tax treatments. To that end, we are pleased to present our third annual “Asia Tax Comparator” as Asia Briefing Magazine’s final issue of 2013. Continue reading
Nov. 11 – Arvind Mayaram, economic affairs secretary at the Indian Finance Ministry, has called upon Raghuram Rajan, governor of the Reserve Bank of India (RBI), to transform the rules relating to infrastructure financing as well as the treatment of non-performing loans in that sector. The Finance Ministry views these potential moves as key to reviving growth and investment in India.
In particular, the Ministry would like to see the new rules take effect in cases where infrastructure projects were delayed but not at the fault of the developers. These types of projects should be allowed to refinance without being treated as restructured loans as that would require higher provisioning.
“During the last three years, on account of [the] economic downturn, we are seeing an increase in such projects. There is, therefore, a need for the RBI to permit refinancing without it being treated as [a] restructuring of the loan,” said Mayaram. Continue reading
Nov. 8 – The Reserve Bank of India (RBI) has signed a memorandum of understanding (MoU) with the Australian Prudential Regulatory Authority and the Reserve Bank of New Zealand this week during Deputy Governor K.C. Chakrabarty’s visit to the two countries.
The new MoU establishes “supervisory cooperation and supervisory exchange of information” between Australia and New Zealand’s monetary authorities and the RBI, according to a press release issued by the Indian government today.
As signatories to the MoU, India, Australia and New Zealand will increase monetary cooperation through frequent meetings of high-level officials and on-site visits between government representatives. The deal will encourage greater sharing of monetary strategies between the countries to create stronger economic ties and market stability. Continue reading
Sept. 24 – Hyderabad is soon to be home to a new Information Technology Investment Region (ITIR) following last week’s approval by the Cabinet Committee on Economic Affairs for new ITIR developments.
The ITIR, which will include special economic zones and industrial parks, is expected to become a key information technology hub in the region and will focus on accommodating small and medium sized information technology (IT) and information technology enabled service (ITES) enterprises. Continue reading
Sept. 11 – Recent government data has shown that India’s trade deficit narrowed to US$10.92 billion in August (from US$12.27 billion in the previous month) due to higher exports and lower imports. In August, exports increased 12.97 percent to US$26.13 billion, the second straight month of double digit growth, while imports decreased 0.68 percent to US$37.05 billion. According to India’s Commerce and Industry Minister Anand Sharma, a prominent cause of the narrowed trade deficit was the ongoing decline in gold imports.
“Gold imports have come down… It is coming down,” said Sharma. “Exports are on a firm, positive terrain now. I remain optimistic about exports being in positive territory,” he further added.
Gold imports in August fell to just US$650 million, down from US$2.20 billion in July. This was largely a result of the recent steps taken by the Indian government and the central bank to control demand for the precious metal in the world’s largest consumer market for gold. The government had previously increased the import tax on gold, while the central bank reduced the ability of bullion dealers to make speculative purchases (among other steps). Continue reading
Aug. 29 – On Monday, the Indian government set up its first Tax Administration Reform Commission, a seven-member panel that is to be chaired by well-known Indian economist Parthasarathi Shome.
The Commission was created with the purpose to review India’s tax laws and make recommendations for the creation of a “stable and non-adversarial tax administration.” It will have a time period of 18 months to complete its work and, during its tenure, Mr Shome will have the rank of Minister of State. Continue reading
Foreign investors making surprise returns on investment, cheaper rupee good for exports
Op-Ed Commentary: Chris Devonshire-Ellis
Aug. 22 – With the Indian rupee falling to a record low of 65 against the U.S. dollar, there has never been a better time to purchase Indian manufacturing goods. For foreign investors in India, it is a boom time.
The situation – unprecedented since the Indian Financial Crisis of 1991 – appears to the media to be hitting levels of crisis. But is it? India only very recently engaged ex-IMF heavyweight Raghuram Rajan as the head of the Reserve Bank of India, and it has been under his watch that the rupee has continued its fall against major currencies. This may indeed be indicative of a refreshing new wave of thought in India’s development – leave the currency to market forces and shift its focus to boosting exports and investment. Continue reading