INDIA FOLIO

Vol. 4 No. 5

Embassy of India ~ Copenhagen  

 MAY 14, 2003

 

ECONOMY

India's Exports Cross US$ 50 Billion Mark

As projected by the Commerce Minister of India, Mr. Arun Jaitley, India's merchandise exports have crossed the US$ 50 Billion mark. According to trade statistics recently released by the Union Commerce Ministry, total Indian exports touched US$ 51.7 Billion during the Indian financial year April 2002 - March 2003 - a result 18% higher than India's export performance during the previous financial year.

The result is all the more commendable in the face of the slide in global economy and consequent, sluggish global exports growth. The uncertainties still prevailing in the global economy have caused the Reserve Bank of India Governor to introduce several new measures for easing flows of credit to Indian exporters and offer bank incentives and more liberal refinance facilities.

India's global imports, on the other hand, increased a shade slower by 17%, standing at approx. US$ 59.4 Billion in the financial year in question.

Not surprisingly, a good part of the rising imports bill was caused by higher international oil prices. Thus the value of oil imports into India surged by nearly 27%, reaching an amount of around US$ 18 Billion against US$ 14 Billion only in the financial year April 2001 - March 2002.

The trade deficit for April 2002-March 2003 is, therefore, estimated at US$ 7.7 Billion - higher than the deficit of US$ 7.0 Billion recorded during the previous FY. However, with a sharper rise in the invisibles receipt and larger net inflows from private remittances, India is now set to achieve a surplus on the current account for the second year in succession.

 CII: GDP Growth Exceeding 6%

The Confederation of Indian Industry (CII) has predicted a Gross Domestic Product growth of 6.0%-6.4% during the current financial year in its latest 'state of the economy report'. While the industrial and services sectors are expected to grow by 6.5% and 7.5% respectively, India's agricultural sector is likely to log a growth rate between 2.0% - 4.0% only.

It has been estimated that the country can garner 1.0% of global trade by the year 2006, if Indian exports register a compounded, annual growth rate (CAGR) of 12.0%, and global trade grows at a CAGR of 5.0%.

Top Slot Ranking to India by Merrill Lynch

India has once again grabbed the attention of foreign fund managers, as leading investment-banking firm Merrill Lynch, in its macro country ranking, has given the top slot to India replacing China in the Asia-Pacific region. Merrill Lynch thus reports that low valuations of Indian stocks make India an attractive investment destination, just as India is better placed to deal with the turbulence impacted on global trade by the recent war in Iraq and SARS affecting China.

POLICY


New Delhi Speaks Out Against Slow Progress of Doha Agenda

The Government of India has expressed concern over the lack of any meaningful progress on the Doha development agenda such as implementation issues, special and differential treatment, TRIPS, and public health at the World Trade Organization's (WTO's) trade negotiating committee meeting held in Geneva on April 2nd-4th 03. According to the Additional Secretary of the Commerce Ministry representing India at the meeting, India looked forward to substantial results in the above areas before the 5th ministerial meeting to be held in Cancun in September 03 including the unresolved issue of low or insufficient manufacturing capacity within the pharmaceutical sector.

To many developing countries, success of Cancun is dependent on a successful resolution of these key developmental issues, the Secretary stated, adding that on non-agricultural market access, India is keenly looking forward to engaging constructively in further discussions in the negotiating group on such market access in the light of the proposal put forward by it in line with the Doha mandate.

 16 States Agree to Implement VAT from June 1st 03

Sixteen of India's states accounting for about 75% of all trade and industrial activities agreed to implement the value added tax (VAT) regime during a meeting held in New Delhi in April. The states include Maharashtra, Gujarat, West Bengal, Madhya Pradesh, Karnataka, Andhra Pradesh, Tamil Nadu, Kerala, Haryana, Assam, Orissa, Bihar, Jharkhand, Tripura, Goa, and Meghalaya.

The uniform VAT, which is a state level indirect tax, would replace sales tax and other local taxes. According to an official assessment, tax rates would come down for at least 78% of the 425 items in question, resulting in a reduction of price levels in the country.

IT - SECTOR


Aviva Takes BOT Route for BPO Facility in India

Aviva, the world's seventh-largest and the UK's largest insurance group, is in the process of setting up a call center and claims processing operation in India by the end of 2003. The company thus intends to set up its Business Process Outsourcing (BPO) operations through a partner using a 'Build, Operate, & Transfer' (BOT) model, initially creating 1,000 jobs.

Aviva's existing activities in India include a life assurance joint venture launched in 2002. Aviva already outsources claims administrative service and software development work to companies in India.

 
SAP Sets Aside US$ 120 Million for Boosting India Operations

In order to increase its share in the enterprise software market in India, the German company SAP plans to spend over US$ 120 Million during the next 3 years through its Indian subsidiary, SAP India.

SAP India consequently plans to spend more than US$ 40 Million every year on marketing and sales initiatives in India as well as on increasing its chain of partnerships with systems integrators. SAP India is also open to the idea of acquiring companies in India with the purpose of adding value to its existing offerings.

PHARMA SECTOR

 
Guidelines for Registration of Drug Manufacturing Premises

The Government of India has introduced guidelines for registration of manufacturing premises of foreign drugs manufacturers prior to import of their products into India in respect of all imports of drugs and formulations. Foreign manufacturers now have to apply for registration certificates for their manufacturing premises and the individual drugs to be imported. Applications can be made by authorized agents of foreign firms in India. The validity of registration certificates will be three years from the date of issue. The provisions would also cover diagnostic kits now, including those for HIV I & II and blood group reagents.


WIPRO Showcases E-Health Package at EU Meet

Wipro Technologies of India is staking big on the proposed universal healthcare project being mooted by the European Commission by showcasing its e-health software package during the two-day conference of the European countries. Significantly, Wipro is the only IT company invited by the organizers to present its capabilities to the Heads of the 25 European Union members.

Wipro's remote monitoring package would provide solutions, which can be used in hand-held devices such as Palm, Tablet PC to collect information from a patient's health records through satellite links, so as to provide proper medical guidance and services to the concerned patient. - This innovative concept that Wipro has initiated in the UK has been found so successful that it has generated further interest among EU nations.

TRANSPORT SECTOR

Infrastructure Status for Coastal Shipping Recommended

A Parliamentary Committee has recommended that infrastructure status be granted to coastal shipping. The Committee is of the view that coastal shipping is presently in the initial stages of development and requires a comprehensive policy. Expressing displeasure over the fact that no special attention is given to coastal shipping during the Ninth Plan period, the Committee noted that this mode of transport offered effective alternative means considering the vast Indian coastline and the congestion on land routes.

There are 184 minor/intermediate ports along the 5,560 km long Indian coastline. The Committee recommended that the Shipping Ministry should frame a comprehensive policy and prepare plans to promote coastal shipping. However, Shipping Ministry sources point out that a study has already been ordered to assess the development of coastal shipping and minor ports. The study will identify the cargo that can be diverted to coastal shipping from other modes of transport, evaluate future traffic potential for coastal movement, and explore the possibility of developing new routes to meet the existing and potential demands.

FORTHCOMING EVENTS

September 3rd - 5th 2003

8th INDIA INTERNATIONAL CIVIL & DEFENCE EQUIPMENT & SYSTEMS

EXHIBITION & CONFERENCE

(8th IICDES 2003)

* INDIA'S 8th AEROSPACE & DEFENCE SHOW

Exhibits Profile: Systems & Equipment for Land, Air, Naval, & Security Forces, besides Dual-Use, Commercial Aerospace/Aviation, Airports, etc.

Venue: Ashok Hotel, New Delhi

Further Information & Registration Formalities Obtainable from Organizers:

SAT Consultants Pvt. Ltd., New Delhi

Phone: 00 91 11 26 28 88 74, Fax: 00 91 11 26 23 60 18

E-Mail: satcon@nde.vsnl.net.in

 

POSTPONEMENT

DELHI INTERNATIONAL LEATHER FAIR (DILF)

- Originally scheduled to be held on May 22nd-25th 2003

at Pragati Maidan, New Delhi

- Has been postponed till:

OCTOBER 19th - 22nd 2003

(Sunday - Wednesday)

 

Issued by the Embassy of India, Commercial Section, 15, Vangehusvej,  DK-2100 Copenhagen, Tel: 39 29 08 54/39 18 28 88  Fax: 39 27 02 18
E-Mail: indcom@songmail.dk  Web: https://www.indian-embassy.dk/ 

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