Friday, 28 November 2014
Additions affirmed for loans given to parties with dubious identity and credit worthiness
RBI removes restriction on gold import; withdraws 20:80 scheme
Compensation received by assessee for surrendering rights of an industrial plot is capital receipt
Airtime charges and license fee charged separately from subscribers of pager wouldn't form part of s
No penalty if AO didn't give independent opinion that old asset was acquired mainly to claim higher
Co. dealing with software products isn't functionally comparable with a co. which is software servic
One-time premium paid to lessor for transfer of interest in immovable property isn't liable to ST
Liquidator couldn't direct creditor to refund excess payment when his claim was disbursed after due
India: Stainless Steel Mills Demand Protection Against Cheap Imports From China
The operating capacity of India’s stainless steel (SS) mills has declined to a low of 55 per cent, says the industry, due to cheap imports from China and other free trade agreement (FTA) countries, amid weak demand. The capacity utilisation was 65-70 per cent a year before.
Speaking on the sidelines of the announcement of Indinox 2015, a two-day SS industry event, scheduled to be held between January 24 and 27, 2015, at Gandhinagar, N C Mathur, president of the Indian Stainless Steel Development Association (ISSDA), said: “The SS mills have steadily invested $5 billion since its peak days of 2006-07, to create an overall installed capacity of around five million tonnes. Against that, we estimate a total production at 2.6-2.7 mt in 2014-15.”
This is because of dumping of Chinese goods into India, with some of these of substandard quality, he alleged.
Imports from China, Taiwan and Korea are estimated to have risen 150 per cent in about seven months. ISSDA says imports have gone up to around 40 per cent of annual consumption. In 2013-14, total import from all countries was 100,000 tonnes. However, says the body, imports from China alone have been 250,000 tonnes in the first half of the current financial year.
“The biggest problem Indian SS mills face is high electricity and logistics cost, unbearable rate of interest on working capital and continuous investment on pollution control equipment. Raw material exports from China attract a high duty of up to 40 per cent, to discourage shipment of inputs like SS scrap or ferro nickel. Over and above, the Chinese government is incentivising up to 13 per cent on export of SS, apart from low interest rates on working capital loans and cheap power. The industry will be protected only with a minimum differential duty of 7.5 per cent, which currently exists at five per cent,” said Hiten Bhalaria, managing director of Bhalaria Meal Craft, an SS utensil manufacturer and exporter.
Jindal Stainless has invested around Rs 12,000 crore in its 1-mt project in Odisha, currently at 30 per cent of its operating capacity. Its Hisar facility is currently operating at 60-70 per cent capacity.
“When Prime Minister Narendra Modi is emphasising on ‘Make in India’, here is an industry which is bleeding due to imports, despite having enough production capacity. We certainly need protection in terms of anti-dumping duty. The difference between raw material and finished product imports is currently five per cent in India as against 10 per cent in China,” said Mathur.
The industry also wants a relook at FTAs. The industry says import from countries with which we have signed such agreements are rising significantly, without any jump in our exports. India is the third largest global producer and second largest consumer of SS. The market for 2013-14 was at 2.5 mt, of which flat products accounted for about two mt. With a low per capita consumption of 2.1 kg (as against the world average of about five kg), there is a lot of potential for future growth. However, a slowing in the infrastructure sectors has been a major obstacle.\
Souce:hellenicshippingnews.com
Kakinada Anchorage Port To Become Rice Export Hub
The Anchorage Port in Kakinada has the potential to become rice export zone, provided the government focuses on developing infrastructure and facilities in the port, besides relaxing some norms pertaining to the exports.
As the East and West Godavari districts are known for paddy procurement and record yields every year, the surplus paddy is being exported to foreign countries through the anchorage port. Following the lifting of ban on rice exports in September 2011, there is a steady increase in rice exports and the exporters are focusing more on the African countries.
In 2012-13, 26.73 lakh metric tonnes of rice had been exported from the port. However, the year 2013-14 witnessed a drop in the export activity due to Samaikyandhra movement that lasted for over three months. The exports were to the tune of 22.67 lakh metric tonnes during the year.
Now, the government has changed the levy policy, providing an opportunity to improve the exports. Till the last crop season, the rice millers used to allocate 75 per cent of the rice purchased to the government towards the levy and sell the remaining 25 per cent in the open market that includes the exporters.
As per the revised policy, the levy is only 25 per cent and the remaining 75 per cent of the stocks can be sold in the open market. “This policy is going to be a boon for rice exports over a period of time. Moreover, it is going to be a win-win for both the farmer and the miller,” observes B.V. Krishna Rao, managing director of Pattabhi Agro Foods, one of the largest exporters of non-Basmathi rice from southern India.
East Godavari district alone produces 20-25 lakh metric tonnes of paddy every year and the West Godavari contributes more or less an equal quantum. Till now, the farmers are used to cultivate levy-oriented varieties such as ‘Common’ and ‘Grade A’ and the millers too encouraged the same, as they can clear a major chunk of stocks towards the levy. “Now, the farmers can focus on cultivating superfine variety of rice, which has a greater demand in the European market. By opting for these varieties, the farmers can earn more without increasing the investment and the millers and exporters too can get their margins,” explains Mr. Krishna Rao.
Echoing similar opinion, progressive farmer Kovvuri Trinadh Reddy says the government should come out with a clear policy on the levy and create awareness among farmers about the new cultivable varieties. “The farmer will get benefited only when the government ensures hassle-free export of rice,” he says.
Source:- thehindu.com
India To Reduce Export Documents From Nine To Three By April 1, 2015
The Indian government has fast-tracked efforts to reduce export barriers and improve Ease of Doing Business to boost manufacturing and revive exports.
India’s exports slipped into the negative list in October 2014 y/y for the first time since April 2014. Exports have declined due to several factors such as dipping global commodity prices, strengthening rupee against the USD, and a slowdown in Europe. Experts say that the uncertainty over the release of the new Foreign Trade Policy isn’t helping exporters and the government must take immediate steps to address the decline in exports.
Earlier this month, M Rafeeque Ahmed, President, FIEO, had said that the new Foreign Trade Policy (FTP 2014-19) must be announced soon or the previous one allowed to continue until March 31, 2015, to remove ambiguity among exporters. The new FTP should focus on Marketing, Branding, e-Commerce, Services exports, Project exports, High technology exports and improve Ease of Doing Business, the FIEO chief had said.
India is placed at the 142nd position among the 189 countries in the World Bank’s ease of 2015 Doing Business rankings. In the “Trading Across Borders” sub-index, India has slipped four points to the 126th rank this year.
In response, the Commerce Ministry has announced a slew of measures in the last few days to address the situation. It said that the government will reduce the number of documents required for exports from the current nine to three by April 2015. This will put India on par with other nations such as Singapore which top the list in both “Ease of Doing Business” and “Trading Across Borders” sub-index.
The government has also assured that the Goods and Service Tax (GST) Bill will be introduced in the ongoing Winter Session of the Parliament. GST is expected to play a major role in making Indian companies and goods competitive in the global markets and encourage investments in the manufacturing sector.
The government is also planning a single window clearance system for businessmen to set up projects in India and make use of technology to help get online approvals from various ministries. According to official sources, eight states have already implemented online registration of MSME companies, and talks are on with other states as well.
Approvals regarding labour procedures are expected to become easier with the launch of a labour portal which will help businesses get clearance of 16 labour laws at one place. Six states have also joined portal, according to official sources.
source:- thedollarbusiness.com
'Vijaya Bank' couldn't be treated as an assessee-in-default on non-submission of Form 15G/H before C
In case of FOR sales, transportation upto customer's premises is eligible for credit
Fiscal Relief For India As Opec Maintains Output
Crude oil prices are set to decline further, with the Organization of the Petroleum Exporting Countries (Opec) deciding to maintain output at 30 million barrels per day, resisting calls from Venezuela that the group stem the slide in prices.
Minutes after the announcement, Brent crude slipped by $3 to $74.75 a barrel. Analysts now expect prices to inch closer to $65 a barrel. The Opec move is good news for emerging economies, such as India, which have seen deficits spiral with their oil import bills ballooning over the past few years.
India, which has been battling high inflation for several years, is heading for happier times from a macroeconomic point of view, as the inflation target set by the Reserve Bank of India can now be easily met. The central bank was earlier factoring in oil at around $100 a barrel. The 21 per cent decline in price from that level would help lower inflation. For every $10 a barrel fall in crude oil prices, the current account deficit can narrow by 40-50 basis points.
Barclays India economist Siddhartha Sanyal says: "Given that petrol and diesel prices are now determined by market, the fall in import costs will have an immediate impact on inflation. We are looking at retail inflation averaging around six per cent in 2015; that is significantly lower than the long-term average of 7.3 per cent. This is also true for the wholesale inflation rate, which can in 2015 average about 100 basis points lower than the long-term average. For the current account deficit, our estimate is $32 billion, or about 1.6 per cent of gross domestic product."
Others said India's import bill could meaningfully decline, helping Finance Minister Arun Jaitley meet his fiscal deficit target of 4.1 per cent of GDP. In fact, economists believe the fiscal deficit could contract to 3.9 per cent of GDP after Thursday's Opec decision.
Indranil Sen Gupta, India economist at Bank of America Merrill Lynch, says: "Lower crude oil prices obviously improve India's macro conditions. A five per cent decline in petrol and diesel prices bring Consumer Price Index-based inflation down by 45 basis points." He estimates fiscal deficit at 4.1 per cent of GDP in 2014-15 and 3.6 per cent the next year. Bank of America Merrill Lynch expects crude oil prices to average $96 a barrel in 2014-15 and $91 a barrel in 2015-16.
But weak oil prices are not so positive for upstream oil companies like Cairn India. Oil producers realisations will come under pressure if global crude oil prices continue to weaken. Chirag Dhifule of LKP Securities says any upside in crude oil prices would be positive for Cairn India and ONGC. Given that the production has not been lowered, it is a positive for state-run oil marketing companies. The subsidy burden would not return, given that both petrol and diesel prices do not factor in any subsidy at current prices.
For this reason, the fall in inflation will be sharper in coming months, as imported inflation has significantly moderated with oil prices declining and rupee remaining stable despite the unwinding of the quantitative easing programme of the US Federal Reserve. The outlook for India continues to improve with this latest move of Opec.
Source:- business-standard.com
Rupee Falls To 62/Dollar Tracking Broad Dollar Gains
The rupee fell to a low of 62 against the dollar compared with Thursday's 61.8750/8850 close. Month-end dollar demand from importers is likely to hurt the Indian unit.
Gains in shares and resulting capital inflows may limit a very sharp upside to the pair.
Indian shares rise to record highs ahead of GDP data, RBI policy.
Almost all Asian currencies are weaker compared against the dollar.
Index of the dollar against six major currencies trading up 0.5 per cent.
USD/INR pair is seen in a 61.70 to 62.10 range on Friday.
GDP data, due post market hours, and the RBI policy review on Tuesday are in focus.
Source:- ndtv.com