Samsara Newsletter

Week 50, 2019 (Dec 07 - Dec 13)

Policy & Economy News

Benefit of FTAs to small exporters

Corporate tax rate cut will make India a global manufacturing hub by boosting new investments, says Finance Minister

Business News - The India Boom Factor

Amazon to take Indian MSMEs to 180 Countries; here's how small businesses can go Global

India's engineering exports can reach target of USD 1 trillion by next year

Next round of India-Chile PTA expansion talks seek wider trade basket

Shipping News

APL launches new Asia Subcontinent Express 8 service

Maersk's seasonal adjustment to Europe Middle East service ME1

Landmark 'The Recycling of Ships Bill, 2019' passed in Parliament

Logistics News

The aim is an integrated, seamless, efficient, reliable, green, sustainable & cost-effective logistics network: Goyal

Indian Port News

JNPT & CONCOR announce weekly scheduled export train from ICD Ludhiana to JN Port

AP Govt initiates step to build Ramayapatnam as Non-Major Port

Projects worth Rs 13,308 (Rs.133 billion)crore awarded for upgradation of Ports in last three years: Shri Mansukh Mandaviya

Policy & Economy News

Benefit of FTAs to small exporters
Exim News Service - New Delhi, Dec. 12 Top
The Free Trade Agreements (FTAs) signed by India provide tariff concessions thereby giving opportunities for exports of products, including those related to small and medium enterprises (SMEs). Some of the SME products on which tariff concessions have been provided by trading partners such as Japan, South Korea and some ASEAN countries fall into the category of readymade garments, leather goods, processed foods and engineering products like auto components. The specific export promotion schemes for micro, small and medium enterprises (MSMEs) include those for participation in international exhibitions and fairs, training programme on packaging for exports, Market Development Assistance (MDA) scheme for MSME exporters and national award for quality products. The government has also taken the following key steps to boost India's trade and competitiveness:

The new Foreign Trade Policy (FTP) 2015-20 launched on April 1, 2015 provides a framework for increasing exports of goods and services as well as generation of employment and increasing value addition in the country, in line with the Make in India, Digital India, Skills India, Startup India and Ease of Doing Business initiatives. The policy rationalised the earlier export promotion schemes for increasing export of goods and services.

A new logistics-related division was created in the Department of Commerce to coordinate integrated development of the logistics sector. India's rank in World Bank's Logistics Performance Index moved up from 54 in 2014 to 44 in 2018.

Various measures for improving Ease of Doing Business were taken. India's rank in World Bank Ease of Doing Business ranking improved from 142 in 2014 to 63 in 2019 with the rank in 'trading across borders' moving up from 122 to 68.

A comprehensive Agriculture Export Policy was launched on December 6, 2018 with an aim to provide an impetus to agricultural exports.

Trade Infrastructure for Export Scheme (TIES) was launched with effect from April 1, 2017 to address the export infrastructure gaps in the country.

Interest Equalisation Scheme on pre- and post-shipment rupee export credit was introduced from April 1, 2015, providing interest equalisation at 3 per cent for labour-intensive/MSME sectors. The rate was increased to 5 per cent for MSME sectors with effect from November 2, 2018 and merchant exporters were covered under the scheme with effect from January 2, 2019.

Transport and Marketing Assistance (TMA) has been launched for mitigating disadvantage of higher cost of transportation for export of specified agriculture products.

This information was given by the Union Minister of Commerce and Industry, Mr Piyush Goyal, in the Lok Sabha today, as per a communique.

Corporate tax rate cut will make India a global manufacturing hub by boosting new investments, says Finance Minister
Exim News Service: New Delhi, Dec. 11 Top
The corporate tax rate cut bonanza, which would result in revenue foregone of Rs 1.45 lakh crore (Rs.1.45 trillion), would help India become a "manufacturing hub" as it would boost new investments into the manufacturing sector. It is too early to elaborate on the impact of the move, but already there are investment green shoots with several foreign companies evincing interest in the new regime that provides for 15 per cent corporate tax rate. The whole objective of reducing the corporate tax was to drive and attract manufacturing investments from all over the world. This prompted the government to introduce a special rate of 15 per cent for new investments from new companies that go into operation between October 2019 to 2023, said the Finance Minister, Ms Nirmala Sitharaman, while speaking during a discussion in the Lok Sabha on Taxation Laws (Amendment) Bill, 2019, said a report.

"We don't want to complicate the system and so this cannot be extended to existing companies that want to go in for expansion. The intention of our September 20 move is to invite fresh investments," she added. The Bill will replace the Ordinance promulgated on September 20, the report added.

Business News - The India Boom Factor

Amazon to take Indian MSMEs to 180 Countries; here's how small businesses can go Global
Daily Shipping Times - Chandigarh, December 12 Top
E-commerce company Amazon India has said it has signed an MoU with Punjab Small Industries & Export Corporation Limited to carry out workshops for MSMEs to export their products to potential customers in over 180 countries through the company's Amazon Global Selling Program. Amazon will train and onboard MSMEs at key MSME clusters in Punjab including in Ludhiana, Jalandhar, Amritsar, Patiala and Bathinda. Amazon launched the Global Selling Program in May 2015 for its sellers to sell goods outside India. It has more than 50,000 Indian manufacturers, sellers and exporters selling across Amazon's 12 international marketplaces.

Helping MSMEs get onboard their platform to sell online along with providing necessary support and mentoring in the process has been the focus for both Amazon and Flipkart. The latter also on recently announced signing MoUs with the Punjab Government to acquire local sellers, artisans, weavers and MSMEs to sell via its marketplace platform. The signing by Amazon and Flipkart with the State Government was done at the Progressive Punjab Investors Summit in Mohali. Amazon's partnership with Government of Punjab signifies the growing interest of large global enterprises in Punjab, said Vini Mahajan, ACS Industries, Government of Punjab.

India's engineering exports can reach target of USD 1 trillion by next year
Daily Shipping Times - New Delhi, December 12 Top
Union Minister Mr. Hardeep Singh Puri, hoped that by next year India's engineering exports will reach the target of USD 1 trillion. He gave away the Engineering Export Promotion Awards (EEPC) for the year 2017-2018 at a function in New Delhi.

Speaking on this occasion he congratulated the EEPC for reaching a record high exports of USD 76 billion in 2017-18 and USD 87 billion in 2018-19.

Hardeep Singh Puri congratulated EEPC for completing 50 years of rewarding exporters and also complemented 111 winners who received national awards. The MoS said that since fifty-five percent of EEPC members are MSMEs, they must also strategize to upgrade their technology and production profile in order to enter the global value chain.

Hardeep Singh Puri informed the gathering about all the measures taken by the Government of India and the Department of Commerce and the Directorate General of Foreign Trade (DGFT) to simplify, bring in greater transparency in the export procedures and enhanced credit and insurance to exporters. The DGFT has put in place a fully electronic refund module and an online filing and issuance of preferential certificate of origin. A web portal of industrial schemes of different Ministries of the Government of India is also available to the engineering industries and the NIRVIK scheme has been announced to ensure enhanced loan availability for exporters.

Minister of State Hardeep Singh Puri urged exporters to tap emerging markets like Africa, the CIS countries, countries of Latin America and the GCC and Mexico and thereby ensure that by 2025 India's engineering exports will reach a target of USD 200 billion.

Chairman EEPC, Ravi Sehgal also addressed the gathering. On this occasion Additional Secretary, Department of Commerce, Bhupinder Singh Bhalla, representatives of industry and the award winners were present.

Next round of India-Chile PTA expansion talks seek wider trade basket
Financial Express - December 11 Top
Once the existing agreement is further expanded it will help India as Chile is a member of the Pacific Alliance.

India and South American nation Chile meet in New Delhi seeking further expansion of the existing Preferential Trade Agreement (PTA).

Confirming this, ambassador of Chile to India Juan Angulo Monsalve said that "The two day negotiations which are going to conclude on Wednesday are focusing on liberalizing 80-90 per cent tariff lines. And to exchange a list of the products."

The two countries have already signed the terms of reference. And the Chilean side is keen on including goods and services in the further expanded agreement when it will be concluded.

According to the envoy, the talks are on track to further expand the present PTA which is already operational as the idea is to expand the trade basket and to add more products.

Both sides are talking about issues related not only to the inclusion of more tariff lines/ increasing Margin of Preference (MoP), but also trade in goods, SPS/TBT, Customs, and Rules of Origin, which is in the PTA between the two sides.

Once the existing agreement is further expanded it will help India as Chile is a member of the Pacific Alliance. India is an observer in the grouping and this will help in deepening cooperation with the emerging bloc.

What is there in the operational PTA?

India has hiked concessions to Chile from 178 to 1031 tariff lines. And Chile on its part has given 1784 tariff lines at 8-digit HS code 2012.

The two countries have been gradually expanding their trade basket which is beyond the rare mineral Lithium. India is looking at copper and gold and the exports from the South American country includes copper ores, Molybdenum ores, fresh fruits like apples, blueberries, grapes, pears, etc.

And India has been exporting leather, textiles, automobiles, pharmaceuticals, chemicals, among other products which are diverse in nature.

When was the first PTA signed?

The first trade agreement between the two countries was signed in 2006 which became operational in 2007. In this first agreement, the tariff concessions were offered on a limited number of products.

This was then expanded after almost ten years of several rounds of negotiations in 2017, which helped in increasing the bilateral trade between the two countries.

From the Indian side, tariff concessions have been offered on products including leather products, iodine, meat and fish products, iodine, and industrial products. Concessions on agricultural, chemicals and pharmaceuticals products, also on dyes and resins have been offered by the South American nation.

Shipping News

APL launches new Asia Subcontinent Express 8 service
Exim News Service: Singapore, Dec. 8 Top
APL, part of the CMA CGM Group, has announced the launch of the Asia Subcontinent Express 8 service (AS8).

The weekly AS8 is set to directly link the South-East Asian economies of Thailand, Singapore and Malaysia with the India Subcontinent markets of India and Pakistan.

The AS8 will be characterised by its direct port connectivity from Laem Chabang to Pipavav, Port Qasim and Karachi. With this, shippers with India- and Pakistan-bound shipments from Thailand will find the AS8 service a faster alternative to relaying cargoes through transhipments.

AS8 will start sailing from Laem Chabang on December 16, 2019 with the following port rotation: Laem Chabang-Singapore - Port Klang (North Port) - Port Klang (West Port) -Pipavav - Port Qasim - Karachi.

Maersk's seasonal adjustment to Europe Middle East service ME1
Exim News Service - Copenhagen, Dec. 9 Top
Maersk has informed in a trade advisory of a seasonal adjustment to the Europe Middle East service ME1 with improved transit time from the Middle East to Rotterdam. It will offer fast and direct product from Nhava Sheva to Rotterdam of 20 days. First sailing will take place on January 23, 2019.

The new rotation will be: Felixstowe - Antwerp - Bremerhaven - Wilhelmshaven - Rotterdam - Jeddah - Salalah - Jebel Ali - Nhava Sheva - Mundra - Salalah - Jeddah - Tangier - Rotterdam - Felixstowe

Further to increase in overall efficiency and reliability on ME1, Maersk will serve Hamburg via AE7 service as well as Bremerhaven gateway on ME1, the communique added.

Landmark 'The Recycling of Ships Bill, 2019' passed in Parliament
Daily Shipping Times - New Delhi, December 11 Top
The Parliament has passed a landmark "The Recycling of Ships Bill 2019'' for Safe and Environmentally Sound Recycling of Ships in India on 9th December. Passing of this Bill is a giant step and historical moment in the Indian Maritime arena and will have far reaching effects in Indian Ship Recycling industry.

The existing Shipbreaking Code (revised), 2013 and the provisions of the Hong Kong Convention, 2009 are dovetailed in this Bill. The Bill, upon becoming Act, will ensure environment friendly recycling process of Ships and adequate safety of the yard workers. On this occasion, Union Minister of State for Shipping (I/C) and Chemical & Fertilizers, Shri Mansukh Mandaviya said that India is a leader in the global ship recycling industry with a share of over 30 per cent of the global market. With the enactment of this bill, India will set global standards for safe and sound environmentally-friendly recycling of Ships, as well as ensure adequate safety of the yard workers. He said that this bill will pave the way for more global ships to enter into Indian Shipyards for recycling and boost employment and business opportunities also.

Shri Mandaviya said that there are various environmental issues and workers' safety concerns interconnected with the ships recycling Industry. Both these issues have been adequately addressed in this bill. He said that the protection of environment and safety of workers are the soul of this bill. Now, ships to be recycled in India will need to obtain a 'Ready for Recycling Certificate' in accordance with the Hong Kong Convention. Hoping for increased business, a large number of Recycling plots, especially at Alang in Gujarat, are also gearing up and obtaining Statement of Compliance (SOC) with the Hong Kong Convention.

The Key Benefits of the bill are as follows:

  • The bill will harbinger significant increased number of global ships entering into Indian Shipyards for Recycling.

  • Recycling of Ships will boost business & employment opportunities and strengthen India's position in the recycling industry.

  • It will raise the brand value of our Ships Recycling Yards located at Alang in Gujarat, Mumbai Port, Kolkata Port & Azhikkal in Kerela.

  • 10% of country's Secondary steel needs, as an outcome of Recycling of Ships, will be met in an eco-friendly manner.

  • Ships Recycling facilities will become compliant to International standards and Ships will be recycled only in such authorised facilities.

  • The tremendous growth of business activities will contribute to the Country's GDP.

Logistics News

The aim is an integrated, seamless, efficient, reliable, green, sustainable & cost-effective logistics network: Goyal
Exim News Service: New Delhi, Dec. 8 Top
The vision of the proposed National Logistics Policy is to drive economic growth and business competitiveness of the country through an integrated, seamless, efficient, reliable, green, sustainable and cost-effective logistics network leveraging the best in technology, processes and skilled manpower, emphasised the Minister of Commerce and Industry, Mr Piyush Goyal, in Parliament last week.

While there is no official estimation of logistics cost for India, some private institutions have estimated it to be 13 to 14 per cent of the GDP. The proposed policy aims to reduce this to 9-10 per cent.

In order to simplify documentation for exports and imports through digitisation, the Department of Revenue, CBIC has taken several initiatives like (i) SWIFT (Single Window Interface For Trade ); (ii) Adoption of Digital Signature; (iii) 24x7 Customs Clearance - for 'facilitated' Bills of Entry and factory-stuffed containers and goods exported under free Shipping Bills at select ports; (iv) Import Data Processing and Management System (IDPMS) - jointly launched with RBI to facilitate efficient data processing for payment of imports and effective monitoring; (v) E-Sanchit; (vi) Two new IT modules - ICEDASH (Ease of doing business monitoring dashboard), and ATITHI app for electronic filing by passengers for baggage, as well as (vii) PCS 1x which is a platform for port-related processes developed by Indian Ports Association, informed a communique.

Indian Port News

JNPT & CONCOR announce weekly scheduled export train from ICD Ludhiana to JN Port
Exim News Service: Ludhiana/Navi Mumbai, Dec. 10 Top
Exporters in Ludhiana & its catchment areas will benefit from new service Jawaharlal Nehru Port Trust (JNPT), India's premier container port, along with CONCOR, recently announced at a 'Trade Meet' in Ludhiana about the commencement of a weekly scheduled export train service from ICD Ludhiana to JN Port. This service every Saturday is to ensure faster evacuation of export containers destined for JNPT, and will also enhance the trade requirement of Ludhiana with the financial capital of India (Mumbai), said a release.

The Ludhiana ICD caters to a vast interior market that includes the states of Himachal Pradesh, Haryana and Rajasthan. With an extensive network of more than 80 ICDs nationwide, CONCOR commands the bulk of Indian containerised rail transportation.

A panel discussion moderated by Mr Niteen M. Borwankar, Chief Manager (Traffic), JNPT, with Mr Avinash Kochar, AGM, Commercial, APM Terminals, Mr Hardik Vaidya, Head Commercial, DP World, Mr Gabriek Juneja, Terminal Manager, CONCOR, Mr Arvind Kumar, Assistant Commissioner, Customs - Ludhiana, and Mr Saurabh Sharma, Regional Manager, PSA Terminal, on "JNPT - THE PORT OF CHOICE" was held at the Trade Meet.

Commenting on the development, Mr Sanjay Sethi, IAS, Chairman, JNPT, said, "Today marks the start of a new chapter enhancing trade connectivity between Ludhiana and Maharashtra. Jawaharlal Nehru Port Trust handling the majority of India's container freight and connectivity between the two cities is extremely significant for the emerging market economy. We had committed to look into this trade request positively when we met earlier this year in August, and this will definitely open an opportunity for enhancing cargo generation between Ludhiana and JN Port through rail."

On average, the port currently sends and receives nearly 20 trains daily. CONCOR has also agreed to accommodate export containers of other private train operators on their trains for facilitating timely connection of exports to container vessels at JN Port, the release said.

All shipping lines can now take advantage of this new service as this will widely benefit exporters in Ludhiana and its catchment area. This will open an opportunity for JNPT to further accelerate its rail movement that has seen a steady increase in the past couple of months.

The 'Trade Meet' was well attended by the trade fraternity and evoked excellent response, the release added.

AP Govt initiates step to build Ramayapatnam as Non-Major Port
Daily Shipping Times - Hyderabad, December 12 Top
The Andhra Pradesh Government has initiated the first step to build a Rs 10,000 crore (Rs.100 billion) greenfield port at Ramayapatnam as a Non-Major Port, a location which the Central Government is also "examining" to develop as a Major Port.

The State Government, through RITES Ltd, has filed an application with the expert appraisal committee (EAC) attached to Ministry of Environment Forest and Climate Change, to set the ball rolling on the terms of reference for environment and coastal regulation zone clearances for the project.

"It is planned to develop the port as all-weather port with world class terminal facilities well suited to meet the present and future needs of the trade," RITES wrote in the application.

Recently Shipping Minister Mr. Mansukh Mandaviya told Parliament that the Central Government has set up a committee to examine the development of a new Major Port at Ramayapatnam and is looking into the draft report submitted by the said panel.

Ramayapatnam will now be the focus of a bargain between the Centre and the State Government on developing the new port to replace the site earlier identified at Dugarajapatnam in Nellore district as part of a deal when the State was parted into two.

Citing viability concerns, the Centre dropped Dugarajapatnam as a preferred location. The new port was to be set up as a Central Government-owned port/Major Port under the Companies Act with equity participation of 74 per cent from the Central Government through Visakhapatnam Port Trust and 26 per cent from the Andhra Pradesh Government.

By taking the lead to secure environment and CRZ clearances for the Ramayapatnam site, the State Government has signalled its intentions to build the new port as a private port through the public private partnership (PPP) mode without the backing of the Centre, the Shipping Ministry official said.

Projects worth Rs 13,308 crore (Rs.133 billion)awarded for upgradation of Ports in last three years: Shri Mansukh Mandaviya
IBEF - December 11, 2019 Top
In a written reply to the question in Rajya Sabha regarding the expenditure incurred on upgradation of Ports & Harbours and Port facilities, the Minister of State for Shipping(I/C) and Chemicals & Fertilizers, Shri Mansukh Mandaviya stated that during the last 3 years, a number of projects involving total project cost of Rs 13,308.41 crore (US$ 1.90 billion) have been awarded on the upgradation of the major ports. The details of the infrastructure development projects awarded during the last three years are as follows:

F.Y No. of Projects Expenditure/Investment (Rs crore) Capacity (In MTPA)
2016-17 54 Rs.8484.47 crore (Rs.84.8 billion) 92.09
2017-18 25 Rs.2659.73 crore (Rs.26.5 billion) 21.93
2018-19 25 Rs.2164.21 crore (Rs.21.6 billion) 10.73
TOTAL 104 Rs.13308.41 crore (Rs.133 billion) 124.75

Shri Mandaviya further informed the House that the mentioned funds were allotted to these projects pertaining to construction of new berths/harbours and terminals, mechanization of existing berths/ harbours and terminals, capital dredging for deepening of drafts for attracting large vessels, developing of road and rail connectivity etc.