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Week 49, 2019 (Nov 30 - Dec 06))

Policy & Economy News

Foreign exchange reserves continue upward march

MSMEs contribute nearly half of India's exports

Natural gas consumption to rise 3-folds in 10 yrs for 15% target: Pradhan

Business News - The India Boom Factor

Cabinet approves pact with Germany on Railways

India's merchandise & services exports stood at $538 bn in 2018-19: Piyush Goyal

Organic Food Exports from India Rise by 50% to INR 5151 Crore (INR 51.5 billion): APEDA

Shipping News

PIL enhances Redsea Gulf Service

Shipping Minister highlight steps taken to increase tonnage capacity of Indian Shipping Industry

Logistics News

Govt giving importance to cold storage infrastructure, says Minister

Warehousing sector gets investment of Rs 25,000 cr (Rs.250 billion) since 2017; figure may touch Rs 49,500 cr (Rs.195 billion) by 2021

Indian Port News

Roadmap developed for increasing Indian Port capacity to 3300+ MTPA by 2025: Mansukh Mandaviya

New Mangalore Port Chairman highlights Agri export potential of Karnataka

Policy & Economy News

Foreign exchange reserves continue upward march
Exim News Service - Mumbai, Dec. 1 Top
The country's foreign exchange reserves continued their upward movement and gained a modest $ 347 million to touch a new high of $ 448.6 billion in the week to November 22, according to the weekly data released by the Reserve Bank of India (RBI) on November 29, 2019, said a report.

The reserves had increased by $ 441 million to reach $ 448.249 billion in the last week. The gain was mainly on account of the increase in foreign currency assets, a major component of the overall reserves, which was up by $ 254 million to $ 416.725 billion during the week, the data showed, as per the report.

MSMEs contribute nearly half of India's exports
Exim News Service - New Delhi, Dec. 2 Top
Micro, Small and Medium Enterprises (MSMEs) contribute 29.7 per cent of GDP and 49.66 per cent of Indian exports. The government has taken various initiatives to enhance the competitiveness of MSMEs through schemes such as Credit Linked Capital Subsidy and Technology Upgradation Scheme (CLCS-TUS), Micro and Small Enterprises - Cluster Development Programme, Procurement and Marketing Support, and support for MSMEs to participate in international exhibitions/trade fairs, conferences/summits/workshops.

This information was given by Mr Nitin Gadkari, Union Minister for Micro, Small and Medium Enterprises, in a written reply to a question in Parliament, said a release.

Natural gas consumption to rise 3-folds in 10 yrs for 15% target: Pradhan
Press Trust of India - New Delhi, December 05 Top
India's natural gas consumption will have to rise more than three-folds in next 10 years for the environment friendly fuel's share to increase to 15 per cent in the country's energy basket, Oil Minister Dharmendra Pradhan said on Thursday adding that a massive USD 60 billion is being spent to expand gas infrastructure to meet such a demand.

Natural gas currently makes up for 6.2 per cent of all energy consumed in the country. To cut dependence on polluting coal and liquid fuels, the government is targeting its share to rise to 15 per cent by 2020-30.

"Gas consumption has to rise to 600 million standard cubic metres per day for achieving 15 per cent share in energy basket" from current levels of 166 mmscmd, he said at a FICCI conference on gas infrastructure.

The current consumption comprises 80-90 mmscmd of domestic output and the remaining coming by way of imports, he said.

"A massive USD 60 billion is being spent on building gas infrastructure to meet the demand," he said.

The investment is being done in building LNG import terminals, laying pipelines and expanding city gas distribution network so that the usage of non-polluting fuel in the country rises.

Pradhan said natural gas, having dual advantages of being cleaner as well as a cheaper fuel (when compared with liquid fuels like diesel and furnace oil), could help steer India as a transition/ bridging fuel towards a 'low carbon future'.

India presently has 38.8 million tonnes per annum (mtpa) of liquefied natural gas (LNG) import terminal capacity. This is being expanded to 52.5 million tonnes in next 3-4 years, he said.

Also, an additional 14,700 km of gas pipeline is being laid to expand the existing network of 16,800 km.

City gas distribution networks for sale of CNG to automobiles and piped cooking gas to households is being expanded to 70 per cent of the country at an investment of Rs 1.2 lakh crore (Rs.1.2 trillion), he said.

Besides, plans are afoot to set up 5,000 compressed bio gas plants that will convert agri and municipal wastes into gas. These will have a capacity of 15 million tonnes by 2023, he said adding a letter of intents for nearly 500 CBG plants have already been issued.

For fuel investment in the gas sector, the government has is rationalising natural gas grid tariff structure and setting up a gas trading exchange or hub, he said.

India is the world's third-largest energy consumer after the USA and China. According to BP Energy Outlook 2019, India's energy consumption will jump from the current 6 per cent to 11 per cent in 2040.

Business News - The India Boom Factor

Cabinet approves pact with Germany on Railways
IBEF: December 05, 2019 Top
The Union Cabinet chaired by the Prime Minister Narendra Modi was apprised of the Joint Declaration of Intent (JDI) between India and Germany regarding cooperation on strategic projects in the field of Railways. The Joint Declaration of Intent was signed last month.

Benefits: Joint Declaration of Intent (JDI) with the Federal Ministry for Economic Affairs and Energy of the Federal Republic of Germany will provide a platform to Indian Railways to interact and share the latest developments and knowledge in the field of Railways. The Joint Declaration of Intent (JDI) will facilitate exchange of information expert meetings, seminars, technical visits and implementation of jointly agreed cooperation projects.

Background: Ministry of Railways have signed Memorandums of Understanding/ Memorandums of Cooperation/ Administrative Arrangements/ Joint Declarations of Intent for technical cooperation in the rail sector with various foreign Governments and National Railways in respect of identified areas of cooperation, which inter alia, include high speed rail, speed raising of existing routes, development of world class stations, heavy haul operations and modernization of rail infrastructure etc.

The MoUs/ MoCs/ AAs/ JDIs facilitate exchange of technical experts, reports and technical documents, training and seminars/ workshops focusing on specific technology areas and other interactions for knowledge sharing.

India's merchandise & services exports stood at $538 bn in 2018-19: Piyush Goyal
Press Trust of India - December 02 Top
According to data provided by the minister, India has been registering a growth for the past three years in terms of exports of merchandise and services.

The value of India's overall exports rose about 8 per cent to USD 538.07 billion during 2018-19, Parliament was informed on Monday. In a reply to a question in the Lok Sabha, Commerce and Industry Minister Piyush Goyal also said that as per the Foreign Trade Policy 2015-20, the government aims to increase the country's export of merchandise and services to USD 900 billion in 2019-20 and raise India's share in world exports (goods and services) to 3.5 per cent.

According to data provided by the minister, India has been registering a growth for the past three years in terms of exports of merchandise and services.

In 2013-14, exports valued at USD 466.23 billion. It grew to USD 468.46 billion in 2014-15 and fell to 416.60 billion in 2015-16 and again went up to USD 440.05 billion in 2016-17.

The country's overall exports of merchandise and services rose to USD 538.07 billion in 2018-19 from USD 498.63 billion in 2017-18, up 7.90 percent.

Organic Food Exports from India Rise by 50% to INR 5151 Crore (INR 51.5 billion): APEDA
India Seatrade News - December 6 Top
Agricultural and Processed Food Products Export Development (APEDA) declared that exports of organic food produce stood at Rs 5151 crore (INR 51.5 billion) as against Rs 3,453 crore (Rs.34.5 billion) in 2017-18. The export volume in 2018-19 was 6.14 million tonnes. India produced 2.67 million tonnes of certified organic products which include oilseeds, rice, sugar cane, cereals and millets, pulses, fruits, spices, vegetables, dry fruits, tea, and coffee. Moreover, India produced organic cotton fiber. Domestic demand for agricultural organic produce is around Rs 2500 crore (Rs.25 billion). In addition, India witnessed a two fold increase in demand is accounted for chemical and pesticide-free produce.

The most demanded organic food products include soybean, sesame, flax seeds, pigeon pea, red gram, tea, and some medicinal plants. Organic product's major destinations include the USA, Switzerland, Canada, the European Union, Australia, and Israel. In addition, Germany is one of the biggest importers of organic products from India while there is a good demand in Taiwan, South Korea, and Canada.

Organic Farming
The total area under the cultivation of organic farming as registered with the National Programme for Organic Production on 31st March 2019 was 3.56 million hectares. This includes a 1.94 million cultivable area and 1.49 million hectares for the collection of wild harvest. Madhya Pradesh is on the top of the list with the largest area under the cultivation of certified organic farming. Rajasthan, Madhya Pradesh, and Uttar Pradesh also followed it. In 2016, Sikkim set the record of converting its entire cultivable land for the production of organic food produce.

APEDA also organized Biofach, India's largest international trade fair for organic products to encourage the demand. Paban K Borthakur, APEDA chairman said that demand for India's organic agricultural products is about Rs 8500 crore (Rs.85 billion) out of which 60% is international. The NPOP certification has also increased India's credibility in international trade for organic products.

In conclusion, the increasing demand for organic products can change the Indian Agriculture scenario with proper training to farmers. Stringent rules in many countries for the import of food products also lead to many farmers opting to produce organic food. In addition, there is a huge domestic demand in metropolitan cities for organic food.

Shipping News

PIL enhances Redsea Gulf Service
Exim News Service - Singapore, Dec. 4 Top
PIL has announced the following enhancements to its existing Redsea Gulf Service (RGS) and Intra-Redsea Feeder 5 (IR5). These upgrades have been made following the suspension of the Intra-Redsea Feeder (IRF) route with effect from December 2019.
For RGS, a weekly Berbera call will be inserted with effect from Kota Karim 0164W/E ETA Mundra December 7.
The rotation of the new RGS is as follows: Mundra  - Karachi - Jebel Ali - Djibouti - Jeddah - Berbera
For IR5, a fortnightly Massawa call will be inserted with effect from Kota Naluri 0191S/N ETA Jeddah December 28.
The rotation of the new IR5 is as follows: Route 1: Jeddah - Sudan - Jeddah
Route 2: Jeddah - Sudan - Massawa - Jeddah
As per a release, the advantages of the enhanced service are:
-  Improved frequency and fixed weekly window into Berbera
- Direct service into Berbera from India/Gulf/Redsea

Shipping Minister highlight steps taken to increase tonnage capacity of Indian Shipping Industry
Daily Shipping Times - New Delhi, December 3 Top
The Minister of State for Shipping (I/C) and Chemicals & Fertilizers, Shri Mansukh Mandaviya has informed the Parliament that in order to increase tonnage capacity of Indian shipping industry, Government has taken a number of steps. These include:-

1.Providing Indian shipping industry cargo support through Right of First Refusal
2.Reducing GST from 18% to 5% on bunker fuel used in Indian flag vessels
3.Allowing carriage of coastal cargo from one Indian port to another Indian port via foreign ports in Sri Lanka and Bangladesh
4.Removing licensing requirement for chartering of foreign registered ships by citizens of India, companies incorporated in India and Registered Societies to encourage coastal movement of agriculture and other commodities, fertilizer, Export-Import Transshipment Containers and Empty containers
5.Bringing parity in the tax regime of Indian seafarers employed on Indian flag ships vis-ą-vis
those on foreign flag ships
6.Allowing shipping enterprises based in India to acquire ships abroad and flag them in the country of their convenience
7.Allowing use of imported Containers for carrying of domestic cargo and allowing use of locally manufactured or domesticated containers conforming to the specifications from the International Organization (ISO), for transportation of Export-Import cargo.

Logistics News

Govt giving importance to cold storage infrastructure, says Minister
Exim News Service - New Delhi, Dec. 3 Top
Around 1,303 cold storages with a total capacity of 45,62,860 metric tonnes (mt) have been established in the country under the schemes of the Ministry of Food Processing Industries and Department of Agriculture, Cooperation and Farmers Welfare (DAC&FW) from 2015-16 to 2019-20 (as on October 31, 2019). This information was given by the Minister of State for Food Processing Industries, Mr Rameswar Teliin, in Parliament on Tuesday.

Ministry of Food 
Processing Industries is implementing Pradhan Mantri Kisan Sampada Yojana (PMKSY), which comprises of component schemes, namely, (i) Integrated Cold Chain and Value Addition Infrastructure, (ii) Mega Food Park, (iii) Creation of Backward & Forward Linkages, (iv) Creation/Expansion of Food Processing and Preservation Capacities, (v) Agro processing Cluster and (vi) Operation Greens. Cold storages are established as a part of these schemes. The prospective entrepreneurs may apply against the Expression of Interest as and when floated by the Ministry.

Cold storages are also established through the schemes of Department of Agriculture, Cooperation & Farmers Welfare (DAC&FW), namely, (i) Mission for Integrated Development of Horticulture (MIDH) in the country and (ii) Capital Investment Subsidy for

Construction/Expansion/Modernisation of Cold Storages and Storages for Horticulture Products of National Horticulture Board, said a release.

Warehousing sector gets investment of Rs 25,000 cr (Rs.250 billion) since 2017; figure may touch Rs 49,500 cr (Rs.195 billion) by 2021
Daily Shipping Times - Mumbai, December 04 Top
The country's warehousing sector has attracted an investment of Rs 25,400 crore (RS.254 billion) since 2017 and the inflow is likely to reach Rs 49,500 crore (RS.495 billion) by 2021 on robust demand for logistics space by e-commerce companies, according to global property consultant Colliers.

The industrial and warehousing sector in India has attracted significant investor interest since 2017 led by robust demand from e-commerce and other consumer-led occupiers, it said.

"The sector has attracted interest from multiple large institutional investors since 2017, with investment inflows of Rs 254 billion (USD 3.6 billion), signifying a large pool of capital available for investment in this sector. We project the investment inflow is likely to touch Rs 495 billion (USD 7 billion) by 2021 as existing participants expand their portfolio and new players enter the market," the consultant said. Colliers noted that this sector in the past has been characterised by fragmented sheds and godowns but now, it is becoming organised because of demand for larger facilities from e-commerce companies.

"Occupiers mulling large contiguous warehouse leases, especially in the e-commerce and 3PL (third-party logistics) sectors, should look at select micromarkets in Mumbai and Pune that offer a good mix of industrial and multi-purpose warehouses. "Bengaluru should also be explored as it offers seamless transfer of goods between States, benefitting from the removal of State-level taxes," said Colliers International India Managing Director and Chairman Sankey Prasad.

On factors driving industrial and warehousing demand, Colliers said the sector is benefiting from Government policy initiatives such as the goods and services tax (GST) implementation and the Make in India programme, as well as global trade dynamics and evolving consumption patterns.

Indian Port News

Roadmap developed for increasing Indian Port capacity to 3300+ MTPA by 2025: Mansukh Mandaviya
Daily Shipping Times - New Delhi, December 02 Top
NEW DELHI: The Minister of State for Shipping (I/C) and Chemical & Fertilizers Shri Mansukh Mandaviya informed that an analysis of nation-wide end-to-end logistics flows of all key commodities (~85% of all commodities) at ports was carried out based on which the National Perspective Plan (NPP) for the Sagarmala Programme was prepared in April 2016.

The Minister informed that as a part of the NPP, a roadmap is developed for increasing Indian port capacity to 3300+ MTPA by 2025. Master Planning of 12 Major Ports has been carried out and 95 capacity expansion and port modernizations projects have been identified. Major Ports capacity has been re-rated with respect to global benchmarks as per berthing policy 2016 and effective capacity has increased by 293 MTPA after re-rating. Global benchmarks have been adopted to improve the efficiency and productivity for Major Ports and 116 initiatives have been identified to unlock 100 MTPA of capacity at Major Ports.

He Further said, an Action Plan for Coastal Shipping has been prepared by the Asian Development Bank (ADB) in September 2019. This action plan includes recommendations with respect to infrastructure creation required to increase the use of Coastal Shipping in India. Ministry of Sipping has approved 67 projects (cost: Rs. 5702 Crore - Rs.57.02 billion) under Sagarmala Programme for financial assistance of Rs. 1,491 Crore (Rs.14.9 billion) for improving port infrastructure and port connectivity.

New Mangalore Port Chairman highlights Agri export potential of Karnataka
Daily Shipping Times - Mangalore, December 02 Top
Karnataka has good potential for the export of agri products, according to A.V. Ramana, Chairman of the New Mangalore Port Trust (NMPT). Speaking at the 'Agri Export Meet 2019' organised by NMPT in Mangaluru. he said agri exporters from Karnataka could find better markets for their products in some Baltic countries if they made use of New Mangalore Port.

Stating that Karnataka has 30 districts and 320 km of coastline, he said agri products from Karnataka contributed around 12 per cent to the State's GDP. Highlighting the district-specific potential for some agri products, he said agri exporters and farmers from the State have the potential to improve agricultural production. The contribution of agri products to the State's GDP could be increased to 21 per cent in another three years, he said.

Referring to NMPT's connectivity with some of the major centres in the hinterland, he said road and rail connectivity with the hinterland is comparatively good during the export season for agri products. He said the export of some of agri products from Karnataka was on the rise, and exporters should make best use of the infrastructure available at the ports to export their products.

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