Samsara Newsletter

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Week 23, 2019 (Jun 1 - Jun 7)

Policy & Economy News

Gross GST revenue up

India projected to move up in global economic growth rankings

World Bank's India Growth Forecast Unchanged At 7.5% For Fiscal 2020

Business News - The India Boom Factor

Coconut product exports to cross INR 2,000 cr. (Rs.20 billion) in FY19

India to maintain its level of coal imports: Fitch

India-China Trade To Cross USD 100 Billion This Year: Envoy

Shipping News

India's global containerised exports up 6 pc

Kochi-Maldives ferry service closer to reality

Logistics News

Railways, Roads and Highways sector to get the largest chunk of investment in Modi 2.0: ICRA

Indian Port News

Online Port Community System is game changer for Shipping Industry : Indian Ports Association

Policy & Economy News

Gross GST revenue up
Exim News Service - New Delhi, June 3 Top
The total gross GST revenue collected in May 2019 is Rs 1,00,289 crore (Rs.1 trillion), of which CGST is Rs 17,811 crore (Rs.178 billion), SGST Rs 24,462 crore (Rs.244 billion), IGST Rs 49,891 crore (Rs.498 billion) (including Rs 24,875 crore ie Rs.248 billion collected on imports) and Cess is Rs 8,125 crore (Rs.81 billion) (including Rs 953 crore ie Rs.95 billion collected on imports). The total number of GSTR 3B returns filed for April, up to May 31, 2019, is Rs 72.45 lakh (Rs.724 million).

The government has settled Rs 18,098 crore to CGST and Rs 14,438 crore (Rs.144 billion) to SGST from IGST as regular settlement. The total revenue earned by the Central and the state governments, after regular settlement in May 2019, is Rs 35,909 crore (Rs.359 billion) for CGST and Rs 38,900 crore (Rs.389 billion) for SGST.

The revenue in May 2018 being Rs 94,016 crore (Rs.940 billion), May 2019 has seen a growth of 6.67 percent over the revenue in the same month last year. Revenue in May this year is also 2.21 percent higher than the monthly average of GST revenue in 2018-19 (Rs 98,114 crore ie Rs.981 billion).

A sum of Rs 18,934 crore (Rs.189 billion) has been released to the states as GST compensation for the months of February-March, 2019, said a release.

India projected to move up in global economic growth rankings
Exim News Service - London, June 5 Top
A report by IHS Markit on the implications of the NDA's massive victory in the recent elections says that the economic outlook "looks positive" for the second term of the Narendra Modi-led government, with GDP growth estimated to average around 7 per cent per year over the 2019-2023 period and India forecast to overtake the UK to become the world's fifth largest economy this year. Besides, it is projected to surpass Japan and reach the second position in the Asia-Pacific region by 2025, says a report.

It said that in Prime Minister Modi's second term in office, India will continue to confront significant economic challenges. "A key policy priority for the Indian government will be to continue to drive reforms in the public sector banks and reduce the burden of non-performing (or bad) loans on their balance sheets," IHS said.

Further analysing the progress of the economy, it said that continuing to drive the transformation of India's industrial sector through the 'Make in India' programme will also be a strategic priority, in order to improve manufacturing sector output growth and generate stronger employment growth. "When PM Modi launched the Make in India strategy in 2014, he set a target of increasing the contribution of manufacturing to GDP to 25 per cent. However, by 2018, the manufacturing sector share of GDP is still at 18 per cent, which still leaves a substantial gap to bridge in order to achieve this vision."

Despite the significant achievements in infrastructure development during the Prime Minister's first term, rapid infrastructure growth in key sectors such as transport and power remain important priorities, as well as reducing the regulatory burden of government red tape, said the report.

World Bank's India Growth Forecast Unchanged At 7.5% For Fiscal 2020
NDTV India - New Delhi, June 5 Top
The World Bank retained its forecast of India's growth rate at 7.5 per cent for the current financial year. In its Global Economic Prospects report, the World Bank also said growth rate is expected to remain the same for the next two fiscals.

"In India, growth is projected at 7.5 per cent in FY2019/20 (April 1, 2019 to March 31, 2020), unchanged from the previous forecast, and to stay at this pace through the next two fiscal years," the World Bank said in its report.

According to the report, private consumption and investment will benefit from strengthening credit growth amid more accommodative monetary policy, with inflation having fallen below the Reserve Bank of India's target. Support from delays in planned fiscal consolidation at the central level should partially offset the effects of political uncertainty around elections, it added.

The outlook for South Asia over the forecast horizon is expected to remain solid, with regional GDP expected to expand to 6.9 per cent in 2019, 0.2 percentage point down from previous projections owing to downward revisions for Pakistan, but to pick up to 7 per cent in 2020 and 7.1 per cent in 2021.

The contribution of exports to economic activity is expected to remain weak with moderate global trade growth, the report mentioned.

The World Bank, in its report, observed that the main domestic risks to the outlook include a re-escalation of political turbulence amid elections in some countries (Afghanistan and Sri Lanka); fiscal slippages with expanding public spending; and a resurgence of non-bank financial sector funding issues.

It further said the Goods and Services Tax (GST) regime is still in the process of being fully established, creating some uncertainty about projections of government revenues.

In Sri Lanka, the World Bank said a rise in political uncertainty in the months leading up to presidential and parliamentary elections, which will take place in 2019 and 2020, respectively, could weigh on business confidence. In addition, recent security-related incidents could dampen investor sentiment and perceptions.

Another factor accounted for by the World Bank is uncertainty about the Brexit process, which possesses the ability to create a risk to some South Asian economies which have preferential trade agreements or generalised system of preferences with the European Union and significant exports to the UK, including India, Bangladesh, Pakistan, and Sri Lanka. A no-deal Brexit could have a significant impact on exports of those countries to the UK in the absence of new trade agreements, it contended.

Business News - The India Boom Factor

Coconut product exports to cross INR 2,000 cr. (Rs.20 billion) in FY19
Exim News Service - New Delhi, June 2 Top
Thanks to higher prices for activated carbon in the overseas markets like the US, the UK, Germany, Japan and Korea, where it is mainly used for the purification of gold, water and air, India's coconut product exports are set to cross the Rs 2,000-crore (Rs.20 billion) mark in FY2019, says a report.

India exported 80,467 tonnes of activated carbon, valued at Rs 1,123.64 crore (Rs.11.2 billion), till January and the total exports of overall products stood at Rs 1,812.55 crore (Rs.18.1 billion). The value is estimated to touch Rs 2,100 crore (Rs.21 billion) for the entire fiscal.

Activated carbon fetched a price of Rs 140/kg in FY2019 vis-a-vis Rs 100/kg in FY2018.

The low price of coconut shell and higher price realisation of activated carbon has made the industry more attractive, said the report.

India to maintain its level of coal imports: Fitch
Daily Shipping Times - New York, June 7 Top
India is expected to maintain the current level of thermal coal imports as the country's power demand is likely to increase, said a report by Fitch Ratings.

Growth in renewable energy capacity may not be able to keep pace, it said.

"Fitch expects India to maintain its level of thermal coal imports," the rating agency said.

Domestic output of dry fuel and logistics bottlenecks in coal transportation will also affect supply of coal to the market, it said. "Indian coal imports increased by about two per cent y-o-y (year-on-year) in the nine months to March 2019," it added. "India's thermal power plant utilisation increased in 2H18, driven by higher electricity demand and lower capacity addition," it said.

State-owned utilities led the growth in thermal electricity generation, it said adding that the utilisation of the Central Government-owned and private sector plants increased slightly.

Fitch said it expects cost-competitive renewable energy to account for a larger portion of India's electricity generation in the medium term, and to put pressure on thermal plant utilisation.

India imported 164.21 million tonne of non-coking coal in 2018-19 as against 144.99 million tonne in 2017-18, according to mjunction services, a business-to-business e-commerce company that also publishes research reports on coal and steel verticals. Non-coking coal is mainly used as thermal coal or power general.

India's coal import increased to 233.56 million tonne (MT) in 2018-19 as compared with 214.61 MT imported in 2017-18, according to mjunction services.

India-China Trade To Cross USD 100 Billion This Year: Envoy
Press Trust of India - Beijing, June 7 Top
Bilateral trade between India and China is set to cross USD 100 billion this year, India's Ambassador to Beijing said Thursday as he inaugurated an Indian oleoresin extraction firm's 3rd manufacturing facility in the country to expand its business in the Chinese food market.

Kochi-based Synthite Industries 46,000 sqm facility at Wucheng county in Dezhou in Shandong province was inaugurated by Indian Ambassador to China Vikram Misri along with local Chinese government officials.

The company is said to be the world's largest producer of value added spices and extracts.

In his address, Misri said the informal summit between the Prime Minister Narendra Modi and President Xi Jinping in Wuhan last year was a milestone and has been instrumental in taking our relations to a new height.

Since then the leaders had met four times on the side-lines of various summits last year.

He said the economic and commercial engagement between India and China constitutes a major component of the bilateral relations with bilateral trade, which crossed USD 95 billion last year, is set to cross USD 100 billion this year.

"Chinese investment in India and Indian investment in China have also seen robust growth in recent years. Chinese companies like Xiaomi, Haier, Oppo, etc, have become household names in India. I am also proud to inform that there are around 125 Indian companies operating in mainland China in various sectors like information technology, manufacturing, textiles, food processing," he said.

Synthite's new facility in Dezhou is intended to cater to its growing demand for their various products across the food, beverage and healthcare segments globally, Viju Jacob, Managing Director of the USD 250 million Synthite Industries told the Indian media here on Wednesday.

From a humble beginning of starting with pepper oleoresin in 1972 the company came a long way fast expanding footprints in India, China and in a number of other countries in the world, he said.

Oleoresins are the concentrated form of spices where you get the wholesome flavour and aroma of the spice. Most oleoresins are used as flavours and perfumes. Some are also used medicinally.

The new facility in China has the capability to extract and process Indian chilly, black pepper, ginger, garlic, and marigold in addition to Chinese sweet paprika. Further spice blends, curry powders and seasonings are also being planned.

Also plans are afoot to set up an application lab at Shanghai for curry powders and seasonings to customers catering to Chinese food industry, he said.

"We are delighted to flag-off this state of the art facility in Shandong in line with our long-term strategic growth plans for the region and it demonstrates our commitment towards our valued customers in China," Jacob said.

He said from very humble beginnings in China, "where we started with a two man sales office, we are currently at 150 employees and growing".

Considering the success of oleoresin products, Chinese firms are now trying to make forays by establishing factories in Andhra Pradesh and Telangana, he said.

Jacob said India has lost the status of being the largest producers of pepper to Vietnam, which now produces about 2.5 lakh metric tonnes (MT) per annum.

India, which is now importing 5000 MT of pepper should reorient its agricultural policy to cut down the imports, he said.

Shipping News

India's global containerised exports up 6 pc
Exim News Service - MUMBAI, June 6 Top
India's containerised exports with the world witnessed a stable growth of 6 per cent in the first quarter of 2019 propelled by robust performances in refrigerated cargo, engineering and pharmaceuticals sectors, while imports declined slightly in the same quarter, registering a market growth of -2.2 per cent in Q1. The import demand was buoyed by pharmaceuticals, metal, appliances and kitchenware, paper, chemicals and fruit and nuts, mainly from Northern Europe, South Asia, China and Russia. Exports were driven largely by the East and West of India, which both contributed double digits to the growth, with commodities, including plastic, rubber, textile, vehicles and vegetables as the key drivers.

Commenting on the overall growth in containerised trade, Mr Steve Felder, Managing Director Maersk South Asia, said,"Enabling and facilitating trade is an integral part of our business, and it contributes to prosperity and development, globally and locally. Considering the tensions in the global trade environment, we are off to a positive start to 2019 on exports, and the market is expected to strengthen after the elections. Indian exporters today are expanding their geographical range and product diversification, with a visible shift towards higher value-added manufacturing and technology-driven items. Exports have remained strong even as the rupee appreciated against the dollar, which shows a strong demand for Indian exports. The moderation of global containerised trade growth reflects a broadbased slowdown in main economies due to declining growth in private consumption, trade tensions, political risks and financial volatility."

Export trade with Saudi Arabia, China and Egypt was driven by commodities like plastic and rubber, tiles, stone, glass, textiles and seeds, beans, cereals and flour leading the growth curve in the dry cargo segment. Vegetables drove refrigerated cargo exports to Saudi Arabia. Imports were primarily driven by Germany, South Korea and Russia. In contrast to the previous quarter, metal and paper imports saw a decline.

Refrigerated cargo saw a stable 6 per cent growth in exports in Q1 2019, with commodities like vegetables, fruit and nuts, fish, meat, pharmaceuticals and chemicals driving the reefer import-export trade. Saudi Arabia, the US, Germany, Belgium and Spain were among the highest export countries for India's refrigerated cargo with chemicals, pharmaceuticals, meat and vegetables driving this demand; while Russia (chemicals) and Italy (fruit and nuts) remained the strongest partners from the refer imports standpoint.

"As the Indian logistics sector gears itself for a deeper implementation of new emerging technologies like blockchain and artificial intelligence, the industry needs to focus on skill development to enhance the export growth. The government's efforts to grow international trade are already visible through the plethora of initiatives over the past year, including the relaxation of cabotage regulations and favourable regulatory environment, emphasised by the grant of infrastructure status to the logistics industry. However, India needs to drive and indeed fast-track investment-led infrastructural upgrade of roads, intermodal transportation and cold chain infrastructure, which would benefit the farmers and small and medium enterprises. The 'Make in India' initiative is further expected to act as a catalyst in advancing our manufacturing sector to the international market," added Mr Felder.

Exports from the North and West were chiefly driven by plastic and rubber which saw double digit growth in Q1 2019, while the South and East regions saw a 25 per cent growth in vehicle exports. While Saudi Arabia and the United Kingdom were among the top export markets for the North and the West regions, South and East India drove the exports to China. Interestingly, East India saw the highest growth in exports to the US, at 17 per cent, followed by South India at 14 per cent. Commodities exported to the US include foodstuff, seafood, pharmaceuticals, metal, plastic, rubber and textiles, said a release.

* Y-o-Y percentage is comparison of Q1 2019 with same period last year, i.e. Q1 2018

**Data Tabulated basis Maersk containerised data

Kochi-Maldives ferry service closer to reality
India Seatrade News - June 7 Top
The much-awaited Kochi-Maldives ferry service is a step closer to being realised, with the Centre reconsidering the proposal mooted in 2011.

The proposal for a ferry-cum-cargo service from here to the island nation was mooted in 2011 following the SAARC Summit. This was followed by a meeting between officials of Kochi and Maldives ports and the Shipping Corporation of India (SCI).

At the meeting, it was decided to structure the service as one having a passenger capacity of 300, apart from the capability to carry 15 to 20 containers and around 500 tonnes of bulk cargo. The transit time between Kochi and Maldives on a modern ferry is a day and will hence be ideal even for perishable cargo.

A senior Kochi Port official said the SCI had expressed keenness to operate such a service even recently. "There was no intimation after that. It was learnt that the Indian Ambassador to Maldives have a letter to the Shipping Ministry, seeking the ferry cum cargo service," he added.

"Our role comes in only after the service is finalised for introduction. We are open to provide berthing to the vessel. A market study to assess the feasibility of such a service must be held. It must also probe whether the demand is more for such a service from Kochi, or from Vizhinjam in Thiruvananthapuram," the official said.

The Kochi Port has a variety of berthing options, from its BTP berth where small and medium ships can be berthed, to other berths where bigger ones can call.

Logistics News

Railways, Roads and Highways sector to get the largest chunk of investment in Modi 2.0: ICRA
Daily Shipping Times - New Delhi, June 3 Top
Railways, Roads and Highways sector are to get the largest chunk of investment over the next five years as the Government is expected to spend Rs 30 trillion in the transport sector in India, market research firm ICRA said.

Taking cues from the BJP manifesto, ICRA said that railways is expected to receive a financial outlay of Rs 10-12 trillion over the next five years while up to Rs 9 trillion is expected to be pumped into the roads and highways sector.

"Amongst the key segments, transport infrastructure is expected to see a major jump with an estimated Rs. 25-30 trillion of capital outlay over the next five years. Such an investment will provide tremendous long-term benefits for the Indian economy," Shubham Jain, Vice-President and Group Head.

The BJP in its manifesto proposed to construct 12,000 kms of national highways every year till 2024. ICRA said that the target was achievable given the length of highways conducted in 2018-'19 touched 10,000 kms.

The new Government is likely to maintain the continuity on the major programmes like Bharatmala Pariyojana (Highways), Sagarmala (Ports), railway station redevelopment programme, inland waterways development, Namami Gange, Swachh Bharat Mission, UDAN (Airports), AMRUT and Smart Cities (Urban Infra), launched during its last tenure.

Meanwhile, Rs 3 trillion are likely to be set apart for urban infrastructure and Sagarmala, the Government's port-led development scheme. ICRA said that the Government is expected to spend Rs 2 trillion on development of 100 airports in the Country, while Rs 1 trillion is likely to be invested for the development of Inland Waterways.

Indian Port News

Online Port Community System is game changer for Shipping Industry : Indian Ports Association
Daily Shipping Times - New Delhi, June 3 Top
India's new port community system is a "Game-Changer" for shipping operations, and is set to help reduce the high logistics costs in the Country.

Known as PCS1x, the platform will improve India's Ease of Doing Business and cut container dwell times, according to Mr. Manish Mrigank, Assistant Director at the Ministry of Shipping's Indian Ports Association (IPA).

"PCS1x will be transformational for the port ecosystem," he said.

"The main objective is to create a single platform of information exchange for all stakeholders in the maritime ecosystem, to bring transparency and operational efficiency."

The "single-window" cloud-based platform facilitates secure message exchanges between Indian ports and local stakeholders, including shipping lines, terminal operators, freight forwarders, inland transport, customs authorities and banks.

It is currently in operation at

19 ports, including Mumbai's Jawaharlal Nehru Port Trust (JNPT), India's biggest container gateway, with volumes of over 5mn TEU. Mr Mrigank said the system would be rolled out to all the country's 200 ports in the near future.

He said the main advantages of PCS1x was to reduce paper-based transactions and introduce process optimisation and standardisation for ports, terminals and other stakeholders, such as the digitisation of key processes surrounding gate operations.

It has already allowed one port to slash the time taken to handle vessel submissions, Mr Mrigank noted.

"Currently one port takes an average of 30 hours to approve the vessel profile submission after it's requested. PCS1x helped identify the bottleneck and bring down the response time to 30 minutes."

Streamlining payments for port services is another key improvement, Mr Mrigank said. The PCS1x payment gateway simplifies the invoice transaction process, since currently most ports use personal deposit accounts at various banks, which customers must pay into.

"The new payment aggregator solution provides the transaction within hours between any two banks. This is a giant leap towards Ease of Doing Business and will help in the improved invoice reconciliation process, easy dispute resolution and ease of cashflow and fund management," he explained.

However, there were teething problems with the launch of the system, according to some sources, with some stakeholders blaming a lack of preparation for software glitches.

"Considering the wide scope of the project and tight deadline - it was completed within seven months - there was initial apprehension during the stabilisation period, but all the concerns have been addressed and this has been a successful journey so far," Mr Mrigank said.

The port community system is one of several initiatives to reorganise India's fragmented logistics industry. Last year the Government announced a National Logistics Portal to help bring down logistics costs from 14% of GDP to 10% by 2022, including an eMarketplace of logistics services, including freight booking and tracking across all transport modes, price discovery and payments.

Mr Mrigank said PCS1x would connect to the portal, allowing for container track-and-trace, which would be a "game-changing experience for the whole ecosystem".

"I feel PCS1x is just a step towards a better, efficient and transformation journey for port industry modernisation. With the advent of new technologies such as blockchain, AI and machine learning, maritime stakeholders can definitely leverage these to become even more efficient and robust," he added.

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