A Big Push To ‘Made In India’ Cars

In a sign of its growing stature in car manufacturing, India is emerging as an export hub of global auto firms not just for small cars but also for big cars such as mid-size sedans and utility vehicles (UVs). Export of big vehicles has been on the rise as an increasing number of global brands are now selling India-built sedans and UVs in other markets.



During April-November 2013, exports of sedans reported a growth of 29 per cent at 77,987 units when compared with 60,512 units in a year-ago period. Share of big cars in total car exports has increased to 21 per cent from about nine per cent in March 2012.



Export of entry-level sedans (include Hyundai Accent, Maruti Swift Dzire and Toyota Etios sedan) and mid-size sedans (Nissan Sunny, Volkswagen Vento and Ford Fiesta, among others) grew by 28 per cent and 31 per cent, respectively, during the period.



In 2012-13, exports of these vehicles more than doubled at 91,478 units when compared with 43,903 units in the previous year, according to statistics of Society of Indian Automobile Manufacturers (SIAM).



“Sedan and UV exports from India have indeed been showing a rising trend. Manufacturers have ramped up their capacity for these vehicles due to the increasing domestic demand and have also concurrently started focusing on exports to optimally utilize their capacities,” Ajay Srinivasan, director, CRISIL Research, told The Hindu.



“While it is little early to say that India has started establishing itself as a manufacturing base for high-end cars, we do visualize the strong growth in sedan and UV exports to continue. The same factors that have made India an attractive small car manufacturing hub – huge size of the domestic market giving economies of scale in manufacturing, strong growth potential, and ample availability of labour and engineers – make India a potent force in the exports of high-end cars as well,” he added. The biggest start was provided by Nissan when it started exporting India-built premium sedan Sunny in January 2012. Nissan has been shipping Chennai-built both hatchback Micra and Sunny to various markets.



Europe’s largest car maker Volkswagen has also been selling ‘Made in India’ Vento across three continents. Recently it started shipping the cars to Mexico, which will become the single largest export market for Volkswagen India.



Along with sedans, UVs are also scripting a success story with their exports increasing to 23,556 units from 4,793 units during April-November 2012 period. Currently, Renault is the largest UV exporter from India, followed by Ford and Mahindra & Mahindra.



Both Renault and Ford have drawn up major export plans for their premium compact SUVs Duster and EcoSport, respectively. Chennai-built Ford EcoSport is being sold in 10 markets. While India’s small car export story is intact, export of bigger cars is also expected to grow strongly as the global OEMs have started realising that vehicles produced here can be sold anywhere in the world, competitively. Mr. Srinivasan also believes that increasing number of car makers would get into exports of high-end cars from India in the future. “Focus on exports also helps manufacturers better manage downturns in the domestic market,” he added.

Source:- thehindu.com

Plan Seeks Reduction In Duty For Imported Wines

The Indian Grape Processing Board has submitted a proposal to the Union government seeking a three-slab reduction in import duty for imported wines, instead of directly cutting it down from 150% to 40%. The board has said the cut will result in more inflow of imported wines in the country causing a notional loss for the wine sector to the tune of Rs 5,000 crore.



The board will also submit another proposal to the Centre to discuss the possibility of the country becoming a member of international organisations like the World Wine Trade Group (WWTG) and the Asia-Pacific Economic Cooperation (APEC) to promote wine and encourage bilateral trade of wine with other countries along with removing trade barriers among other things.



Jagdish Holkar, chairman of the board, said he had raised the issue before the member countries of the WWTG, including the non-European Union (EU) countries, in a recent meeting in Washington DC so that the board could get global support.



"The Union government is in talks with the EU to bring down import duties to 40%, which is drastic. If the duties are directly brought down to 40%, then India will become a dumping ground for imported wine. Therefore, we are trying to exert pressure on the government to rethink its decision to reduce import duty keeping in mind the global platform," he said.



Holkar said membership of the WWTG and APEC will help the country facilitate exchange of information as well as develop expertise in removing trade barriers. "For instance, Thailand has high import duties of 300%-400% on wine, which makes it difficult to enter the market there. Also, bilateral trade in case of wine, which does not exist currently, can also become a possibility if India becomes a member of these organisations," he said.

Source:- timesofindia.indiatimes.com

Follow The Reasoning On Deferred Litigation

Official litigation policy says in revenue matters, an appeal shall not be filed if the amount involved is not very high or is less than the monetary limit fixed by the revenue authorities. It also states appeals shall not be filed if the matter is covered by a series of judgments of the tribunal in question and the high courts, which have held the field and not been challenged in the Supreme Court (SC).



It also says no appeal shall be filed where the assessee has acted in accordance with the long-standing practice and also merely because of a change of opinion on the part of the jurisdictional officers.



In the case of CCE vs Techno Economic Services Pvt Ltd [2010(255) ELT 526 (Bom)], the Bombay high court observed the Central Board of Direct Taxes had taken a policy decision in March 2000 not to file appeals or references wherein the tax effect is less than the amount prescribed in the instructions issued from time to time. This was to reduce litigation before the HCs and the SC. The decision has definitely reduced the volume of litigation, enabling officers to concentrate on cases involving heavy stakes.



The HC asked the Central Board of Excise and Customs (CBEC) to adopt a similar policy, for these and related reasons, including reducing the burden on the courts and on the revenue department.



Accordingly, on October 20, 2010, the CBEC prescribed monetary limits below which an appeal shall not be filed in tribunals/courts on excise, customs and service tax matters. The Finance Act, 2011, gave necessary powers to CBEC to do so with effect from the earlier date.



The monetary limits were revised on August 17, 2011. Accordingly, the department is not to file appeals before a tribunal where the duty/tax amount is less than Rs 5 lakh. The limits for not filing appeals before HCs and the SC are Rs 10 lakh and Rs 25 lakh, respectively. These limits also apply for matters involving refunds.



However, the monetary limits will not be a consideration on matters before the revisionary authority in the finance ministry or where the constitutional validity of the provisions of an Act or Rule is under challenge or where a notification or instruction or order or circular has been held illegal or unconstitutional. Also, decisions or judgments not challenged in appeal or accepted by the department for reasons of monetary limit do not have precedent value.



The relevant laws make it abundantly clear that no person, being a party in appeal, shall contend that the department had acquiesced in the decision on the disputed issue by not filing an appeal, where an appeal has not been filed by the department following instructions issued for not filing one below the monetary limit.



CBEC recently reiterated this point and advised its counsels/representatives in the tribunal to plead that a judgment accepted for reasons of low amount should not be relied upon by the appellate forum.



So, the trade must take note that on all matters involving amounts less than the monetary limits prescribed, the department is at liberty to agitate the issue in subsequent proceedings till the matter is settled on merits.

Source:- business-standard.com

Over 40% Groundnut Shelling Units Down Shutters

Lack of export demand for peanuts in the international market has posed a major threat for the groundnut shelling units in Saurashtra.Moreover, industry sources informed that new export regulations for shelling units has also adversely affected the business.



Since the beginning of the current season in October 2013, shelling units of Gujarat have not received good business from overseas buyers. Exporters are demanding peanuts at lower rate, which is not viable for shelling units.



"We have disparity in price as exporters are demanding groundnut for Rs 51 per kg but our production cost is about Rs 53 a kg. In this condition business is not viable and as a result shelling units have to close their operations", said Mukund Shah, president of Gujarat Oilseeds Processors Association (GOPA).



According to Shah, there are more than 2,000 groundnut shelling units of in Gujarat. Out of these about 40 per cent units are not operational. The rest of the units are also operating at reduced capacity.



The trade body also held responsible, the registration rules for lower business.



As per DGFT notification dated January 3, 2013, exports of groundnut have been subjected to registration with APEDA along with controlled Aflatoxin level certificate issued by APEDA recognized laboratories.



Shah said, "New rules for shelling units is very costly and time-consuming. Hence small shelling units can not afford it. Some of the shelling units have already changed operations and shifted to other commodities."



"Overall demand in the international market for Indian peanut has declined due to heavy selling by the USA as they have large carry-over stock of groundnut. But we are hopeful that demand will prop up after January 2014.", said Kishor Tanna, President of Indian Oilseed and Produce Export Promotion Council (IOPEPC).



According to market sources, Africa is also offering peanuts at the lower rate.



As per IOPEPC data, during April to October 2013, India has exported about 211,765 tonnes groundnut. Last year in same period it was 341,678 tonnes. This year export has declined by 129,913 tonnes mainly after government's notification.



Vikram Duvani, managing director, Rachana Seeds Industry, Junagadh said, "Demand from China and other Asian countries are very nominal and in the near future, there is no hope for good demand for Indian peanuts."



Meanwhile, Arrival of groundnut has increased to 150,000 bags (1 bag = 35 kg) in Gujarat. Price of groundnut is ruling at Rs 600-725 per 20 kg. The IOPEPC has estimated kharif groundnut production fir this year at 4.91 million tonnes from five states - Gujarat, Rajasthan, Andhra Pradesh, Karnataka and Tamil Nadu - which account for close to 90 per cent of total output. This is higher by 2.1 million tonnes as compared to Kharif 2012, when the crop was only 2.81 million tonnes in these states, owing to monsoon failure.



The, Solvent Extractors' Association of India recently issued a kharif crop estimate of the Central Organization for Oil Industry & Trade. The report stated kharif groundnut production for 2013-14 would be 4.71 million tonnes, against last year's 2.62 million tonnes.



For Gujarat, it has estimated the production at 2.5 million tonnes.

Source:- business-standard.com

Gold Facing First Annual Price Drop Since 2000

Barring a late price surge, gold's value will suffer its first annual drop since the start of the millennium, while the precious metal risks further losses in 2014.Gold stood at $1,205 an ounce Friday on the London Bullion Market, down almost 27 percent in 2013 on weaker demand and easing inflation -- snapping twelve years of uninterrupted annual price growth.That leaves gold, whose twin drivers are jewellery demand and investment buying, set for its the first annual price loss since 2000 when its value had fallen by 5.6 percent.

"There are two distinct factors behind the gold price decline this year," Macquarie banking group analyst Matthew Turner told AFP.

"The first one is obviously the investor sell-off," he said, citing a sharp slump in demand from so-called exchange-traded funds (ETFs) that allow investment without trading on the futures market.

According to Turner, ETFs are on course to have sold 840 tonnes of gold this year with the metal's haven status dented by signs of economic recovery despite ongoing strains across the eurozone.

Gold's value took a knock during 2013, also from growing speculation that the US Federal Reserve would start to scale back its quantitative easing (QE) stimulus programme that propped up the world's biggest economy by billions of dollars.

Gold in June hit a three-year low at $1,180.50 an ounce on Fed speculation, before bouncing back.

It came close to matching this level at the end of last week as the US central bank ended months of speculation by finally announcing it would start to scale back its stimulus next month.

Turner said gold demand had fallen for a variety of reasons, including "a growing anticipation of the Fed ending QE... a reduced sense of crisis around the world and the fact that inflation has fallen in most countries this year, especially in the US".

He added: "This last point is very important -- the concept of QE leading to inflation has not really happened." Gold is seen also as a hedge against rising prices.

Fed tapering of its $85-billion-a-month QE policy is meanwhile set to boost the greenback, making dollar-priced gold more expensive for countries using other currencies, further weighing on demand.

Gold has been pushed lower also by rising supply, Turner said, noting that global gold mine output was increasing amid falling purchases by central banks.

In a further blow, the government of top consumer India has hiked gold customs duty three times this year to curb imports and rein in its current account deficit.

"In the very near term, Fed monetary policy stimulus will continue to be the big driver of gold prices, with improving economic data in the US increasing bets of (further) stimulus withdrawal," said National Australian Bank (NAB) economist James Glenn.

The US central bank last Wednesday announced that it would cut QE by $10 billion (7.3 billion euros) a month to $75 billion from the start of 2014. Analysts are forecasting further $10-billion cuts throughout the course of next year.

While NAB predicts that the price of gold will drop to $1,050 an ounce by late 2014/early 2015, Commerzbank is forecasting the metal to reach $1,400 by the end of next year as global monetary policy stokes inflation.

"Gold is... likely to gain greater acceptance again from Western investors as a means of hedging against a loss of purchasing power due to inflation and currency devaluation," they said in a research note.

Source:- nation.com.pk

Rupee Inches Up To 61.94 Per Dollar At Open

The Indian rupee was trading higher at 61.94/95 per dollar on Monday morning compared with its close of 62.04/05 on Friday, tracking slight gains in most Asian currency markets.

Traders will monitor the domestic stock market for further cues on the direction of foreign fund flows. The benchmark BSE Sensex was trading flat almost 50 points higher in early trade. The MSCI index of Asian shares ex-Japan rose 0.4%.

Asian currencies were trading mixed versus the dollar. The US currency extended losses against the yen and euro on profit-taking Monday following solid gains last week, but analysts said upbeat sentiment over the improving US economy would continue to provide long-term support.

Traders expect the pair to hold in a 61.80 to 62.20 range during the session.

Meanwhile, the benchmark 10-year bond yield falls 3 basis points to 8.77% after Prime Minister’s Economic Advisory Council chairman C. Rangarajan was quoted as saying inflation is easing in December.

According to media reports, Rangarajan said headline inflation and retail inflation will ease to 6.5% and 9.2%, respectively, in December on falling vegetable prices.

Longer-dated US treasury debt prices rose on Friday, which are also providing some support to bonds.

Source:- livemint.com

Trust not acting in violation of sec. 13 if it pays reasonable royalty to its members for using its

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