สรุปข่าวเศรษฐกิจอินเดียประจำวันที่ 27 ธันวาคม 2556

India to scan FTAs to protect domestic industry: Natchiappan

India will look into the provisions of all the Free Trade Agreements with other countries so as to protect the interest of the domestic industry, Union Minister of State for Commerce and Industry E M S Natchiappan said. Making a point, he said the India-Thailand FTA provisions would be re-assessed as the domestic electronics industry was getting affected.  He said early talks in this regard were already initiated and further progress would be made once a democratically- elected government assumes office in that nation. India has implemented such trade pacts with several countries including Japan, Korea and Singapore. It is also negotiating over a dozen agreements with nations like Australia and Canada as well as the European Union. However, industry bodies and exporters' grouping FIEO have raised concerns over the impact of FTAs on the domestic market. Earlier this year, Commerce Secretary S R Rao had said that India will be benefited more in the medium-to-long term from these FTAs.

(Source: Economic Times)

DRI asks Air India to check gold smuggling by its staff

Worried over instances of gold smuggling by some Air India staffers, the Directorate General of Revenue Intelligence has asked the national carrier to take necessary measures to check it. In a letter written by Director General of DRI Najeeb Shah, Air India has been asked to sanitise its staff, especially those involved in ground-handling duties, official sources said. The DRI has also cited some past incidents of gold smuggling by Air India staffers in its missive, they said. The Finance Ministry had raised customs duty on gold to 10 per cent in August from 2 per cent in January 2012, besides imposing other curbs on imports of the metal. This is also leading to instances of gold smuggling, officials said. The move to impose curb on gold import was taken to narrow the current account deficit (CAD), the difference between the outflow and inflow of foreign currency. The CAD touched a historic high of 4.8 per cent of GDP in 2012-13 and was mainly attributed to high imports of gold and petroleum products. The CAD narrowed to 1.2 per cent of GDP in the second quarter of this financial year after a steep decline in gold imports. The deficit was 4.9 per cent of GDP in the first quarter (April-June). India is the largest importer of gold, which is mainly used to meet demand of the jewellery industry. Imports stood at about 830 tonnes in 2012-13.

(Source: Economic Times)

Up tax-to-GDP ratio by widening tax base, simplifying structure: Montek

Planning Commission deputy chairman Montek Singh Ahluwalia on Thursday advocated sprucing up the tax revenue-GDP ratio by widening the tax base and rationalising and simplifying the existing structure. He also hinted at the possibility of bringing down the debt-to-GDP ratio (fiscal deficit) over the next five years. “It is unwise to believe the government is taxing more in India. The gross tax revenue (centre-state) to GDP in India is much lower at 19.4% compared to 35% and 40% in developed and matured economies, and I feel it needs to be increased to 24% and beyond. Maybe we are not taxing intelligently to increase the tax-to-GDP ratio. Widening the tax base as well rationalising/simplifying the existing tax structure would serve the purpose," he said. While widening the tax base, the government needs to ensure it doesn’t affect the common public, particularly those living below poverty line, he said, adding India is progressively moving towar-ds this. Ahluwalia said managing public debt is important and one cannot just talk about fiscal policy without looking at the debt-to-GDP ratio. India's debt-to-GDP ratio is on the higher side among developing nations, except Brazil.

(Source: Financial Express)

'Oct GDP data signal economic recovery'

Economic growth in October crossed the five-per cent level for the first time in a financial year, Zyfin Research said on Thursday, giving a sign of economic recovery in the second half of financial year 2014. Gross domestic product (GDP) in October grew 5.2 per cent annually compared with 4.9 per cent in September this financial year. The last time economic growth had crossed the five-per cent level was in August 2012, when GDP had expanded 5.1 per cent. According to Zyfin, this is the fifth straight month of acceleration in growth. According to official estimates, the GDP grew 4.8% in the second quarter of this year compared to a four-year low of 4.4% in the first quarter of 2013-14.

(Source: Business Standard)

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