Weekly News 22 - 26 January 2024

Monday, 22 January 2024 (The Economic Times) Ram Temple, Tourism Push may Add ₹25k cr to UP’s Tax Revenue 

Uttar Pradesh is anticipated to generate an additional Rs 20,000-25,000 crore in tax revenue in FY25, attributed to the completion of the Ram Mandir in Ayodhya and state-driven tourism initiatives, with projected total tourist expenditure possibly surpassing Rs 4 lakh crore by the end of 2024. SBI researchers praised UP's economic strides, including improved female labour force participation, innovation growth, and rising exports, forecasting the state's GDP to reach Rs 24.4 lakh crore ($298 billion) in FY24 and to have substantial weightage in India's GDP by FY28, potentially surpassing Norway in GDP. The state is envisioned to cross the $500 billion mark as India aims for a $5 trillion economy in FY28. 

Tuesday, 23 January 2024 (mint) Cheaper Venezuelan crude may return to India from Feb 

India is set to resume importing cheaper Venezuelan crude oil next month, moving away from Russian imports due to reduced discounts amid sanctions. While Moscow offers discounts of around $2 per barrel, Venezuelan crude comes with effective discounts of $8 to $10 per barrel, following eased US sanctions. This shift aligns with India's strategy to diversify crude oil imports and secure economically favourable supply contracts, meeting its growing energy needs and reflecting a significant change in import dynamics. 

Previously a major supplier, Venezuela was India's third-largest crude oil provider in 2012, with Reliance Industries and Essar (now Nayara) among the main buyers. However, US sanctions led to a sharp decline in Venezuelan crude imports from $6.05 billion in 2019-20 to $714 million in 2020-21. With US sanctions eased, Indian refiners are now exploring discounted Venezuelan crude, marking a crucial phase in India's crude import strategy. 

Wednesday, 24 January 2024 (Financial Express) Govt raises import tariffs on gold, silver to curb surge in shipments 

The finance ministry in India has raised import duties on gold from 10% to 15% to curb the surging imports of the precious metal. The move, effective immediately, follows a 95% spike in gold imports to $7.2 billion in October, leading to a record monthly merchandise trade deficit of $31.46 billion. The increased duties, also extended to silver findings and coins of precious metals, comprise a 10% basic customs duty (BCD) and an additional 5% under the all-industry duty drawback (AIDC), exempt from the social welfare surcharge (SWS). 

This decision comes after India banned specific gold jewellery imports in July 2023 due to a sudden rise in duty-free imports from Indonesia under the India-Asean free trade agreement. The duty hike aims to address the significant import surge and prevent circumvention of the existing 15% duty on gold and silver bars. Commerce ministry data reveals an 86% growth in gold imports in value and a 63% increase in volume during the October-December quarter of FY24, surpassing the April-December FY24 average and impacting India's trade deficit notably in October. 

Thursday, 25 January 2024 (The Economic Times) India to Back Developing Nations’ Sops for Fisherfolk at WTO Meet 

India is gearing up to champion the interests of its impoverished fishermen at the upcoming World Trade Organization (WTO) ministerial conference in Abu Dhabi. The proposal suggests allowing developing countries to provide subsidies to their fishermen within their exclusive economic zone (EEZ) while restricting subsidies for distant water fishing by wealthier nations for the next 25 years. 

Simultaneously, India is in the process of ratifying the first part of the fisheries subsidies agreement from 2022, which bars developed nations engaged in distant water fishing from subsidizing illegal, unreported, and unregulated fishing. With 25% of the world's poor fishermen and 9 million dependents on the sector, India may withhold ratification unless its demands are met. 

Friday, 26 January 2024 (mint) Indian investments key target of Australian minerals reforms 

Western Australia has implemented reforms aimed at attracting investments in minerals and resources, particularly from India. Deputy Premier Rita Saffioti expressed interest in increased collaborations between Indian and Australian firms in rare earths during an interview with Mint. The state is a key supplier of critical minerals like lithium, nickel, cobalt, and rare earth metals, crucial for smartphones, computers, batteries, and electronics. Australia, responsible for half of the world's lithium production, seeks to build new supply chains with India, fostering a critical minerals investment partnership. 

Investments under this partnership aim to create supply chains based on critical minerals processed in Australia, supporting India's emission reduction plans and its aspiration to become a global manufacturing hub, especially for electric vehicles. Saffioti emphasized opportunities for Indian investment in Western Australia through offtake agreements for essential battery minerals. The critical minerals partnership is vital in the global race for lithium mines, a key component in battery manufacturing. India, a net importer of lithium, aims to diversify its sources and boost domestic production, having identified significant lithium deposits, notably in Jammu and Kashmir.