BRICS Summit in China, Modi Cabinet Reshuffle – India Market Watch

Posted by

After Doklam stand-off, Modi and Xi shake hands

A military stand-off in Doklam – an area bordering India, Bhutan, Tibet, and China – came to a dramatic close last Monday as China and India opted for an “expeditious disengagement”.

The next day, Prime Minister Modi confirmed his participation at the BRICS Summit in Xiamen, China – a three day affair from September 3rd to 5th.

The ongoing summit began on a positive note with a much awaited handshake from Modi and President Xi Jinping.

Giving political context to the summit are tensions that erupted between India and China in late June after Chinese troops began building a road in the border region of Doklam. After two and a half months of military posturing, media propaganda, and aggressive missives, both countries agreed to mutually de-escalate tensions.

India and China are facing testier times of late as China seeks India’s support for its One Belt, One Road (OBOR) plans. India remains reluctant as the OBOR project includes plans to build power plants, roads, and railways connecting Pakistan with Xinjiang – all of which will impact the region’s political status quo.

Nevertheless, economic interests trump geopolitical concerns, and both countries are still committed to growing trade and investment ties. Chinese outbound investments have increased in India’s startups and manufacturing sector. India is also looking to balance its trade with China.

During the course of the stand-off, India had tightened FDI rules in sectors with Chinese investments, namely power transmissions and telecom equipment, while Indian SMEs in the solar power sector faced difficulties in procurement with their Chinese suppliers. These sectors will be watching India – China ties more closely.

Professional-Service_IB-icons-2017RELATED: Business Intelligence Solutions

Job creation, infrastructure, 2019 elections behind Modi’s latest cabinet reshuffle

In his third cabinet reshuffle, Prime Minister Modi appointed new ministers in three key ministries, namely, labor and employment, skill development and entrepreneurship, and the ministry of micro, small, and medium enterprises (MSMEs).

Lagging job creation continues to be a problem for the Modi government, now in its third year, as it looks to consolidate its position before the 2019 general elections.

At the center of the government’s ambitions has been the improvement of India’s infrastructure. Key federal ministers – Piyush Goyal and Nitin Gadkari – were rewarded with additional responsibilities for their efforts in furthering clean energy goals, national highway construction, and boosting the profitability of India’s ports.

Goyal will now take on the increasing corporatization of India’s railways while Gadkari is expected to focus on the development of inland waterways.

 Related-Link_IB-icons_2017RELATED: Motoring Ahead: Investing in India’s Automotive Industry

India manufacturing hub for foreign automakers

Foreign automakers are increasingly looking to manufacture in India for exports.

The latest move comes from South Korea’s Hyundai Motor Company, which is completely shifting the production of its mid-size sedan – the Verna – to India. Taking advantage of the Make in India initiative, Hyundai will use its manufacturing facility near Chennai to supply the Verna to almost all its global markets, starting January 2018.

Hyundai has already been manufacturing a range of small cars to larger vehicles at its India base, shipping about 45,000 units of the Creta SUV to overseas markets in 2016.

Other foreign automakers manufacturing in India for exports include Fiat Chrysler Automobiles and Volkswagen. MG Motors India Ltd, a subsidiary of China’s largest automaker SAIC Motor Corp. Ltd, will take over General Motors’ manufacturing facility in Halol, Gujarat in 2019.

About Us

India Briefing is published by Asia Briefing, a subsidiary of Dezan Shira & Associates. We produce material for foreign investors throughout Eurasia, including ASEANChinaIndonesiaRussia, the Silk Road, & Vietnam. For editorial matters please contact us here and for a complimentary subscription to our products, please click here.

Dezan Shira & Associates provide business intelligence, due diligence, legal, tax and advisory services throughout India and the Asian region. We maintain offices in Delhi and Mumbai and throughout China, South-East Asia, India, and Russia. For assistance with India investment issues or into Asia overall, please contact us at or visit us at

Related-Readings_IB-icons_2017Related Reading:

dsa brochure

Dezan Shira & Associates Brochure

Dezan Shira & Associates is a pan-Asia, multi-disciplinary professional services firm, providing legal, tax and operational advisory to international corporate investors. Operational throughout China, ASEAN and India, our mission is to guide foreign companies through Asia’s complex regulatory environment and assist them with all aspects of establishing, maintaining and growing their business operations in the region. This brochure provides an overview of the services and expertise Dezan Shira & Associates can provide.

2017-18 Tax Guide Thumbnail for Related Sources

Tax, Accounting and Audit in India 2017-18

The third edition of Tax, Accounting and Audit in India is updated for 2017, and provides an overview of the fundamentals of India’s tax, accounting, and audit regime. The guide also includes a detailed introduction of the Goods and Services Tax (GST) that was launched on July 1, 2017, representing the complete transformation of India’s indirect taxation structure. 

Payroll processing and compliance in India

Payroll Processing and Compliance in India

In this issue of India Briefing Magazine, we discuss payroll processing and reporting in India, and the various regulations and tax norms that impact salary and wage computation. Further, we explain India’s complex social security system and gratuity law, and how it applies to companies. Finally, we describe the importance of IT infrastructure, compliance, and confidentiality when processing payroll in India.

Leave a Reply

Your email address will not be published. Required fields are marked *

Never miss an update

Stay ahead of the curve in emerging Asia by subscribing to our regional publications. Subscribers take full advantage of all our website features and receive regular updates from our local experts on doing business in Asia.

India Briefing