Indian Economy : News,Discussions & Updates

MNRE Initiates Actions To Attract Investments By Firms Shifting From China

by Swarajya Staff - Apr 18 2020, 5:11 pm
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The Ministry of New and Renewable Energy (MNRE) has initiated action in a big way towards setting up new hubs for manufacturing renewable energy equipment in the country to meet both domestic and global demand.

The ministry has written to various state governments and port authorities to identify land parcels of 50-500 acres for setting up such parks. The Tuticorin Port Trust and the states of Madhya Pradesh and Odisha have already expressed their keen interest in setting up RE Manufacturing Parks.

Secretary, MNRE, Anand Kumar held meetings with RE manufacturing companies last week. The Ministry has also got in touch with Trade Commissioners/ Representatives of various countries inviting them to invest in this promising opportunity in India.

Kumar addressed the US India Strategic Partnership Forum earlier this week through Webinar and sought collaboration and investment by US firms. These facilities will manufacture equipment like silicon ingots & wafers, solar cells & modules, wind equipment and ancilliary items like back sheet, glass, steel frames, inverters, batteries etc. The hubs will also export equipment and services in the RE sector.

At present there is around 10 GW of wind equipment manufacturing capacity.

In case of solar cells and modules India imports about 85 % of its requirements.

The Government has levied a basic customs duty for protecting the solar manufacturing industry in India.

At a time when many companies are shifting their manufacturing base from China, it is time for India to bring policy changes for facilitating manufacturing in India. In tune with this, MNRE has already set up a RE Industry Facilitation & Promotion Board to facilitate investment in the sector., a government statement said.

The Ministry has strengthened the clauses in Power Purchase Agreements( PPAs ) to boost investor confidence.

The three Power and RE Sector NBFCs namely PFC, REC and IREDA have reduced their repayment charges to 2% for enhancing the funds available for new projects in the sector. Moreover, IREDA has brought out a new scheme for project specific funding to promote new RE projects in India.

This news has been published via Syndicate feed. Only the headline has been changed.

MNRE Initiates Actions To Attract Investments By Firms Shifting From China
 
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China Slams India's New FDI Rules, Calls It "Discriminatory": 10 Points

India's new rules for Foreign Direct Investment (FDI) violate WTO principles of non-discrimination and are against free and fair trade, China said on Monday, calling for a "revision of discriminatory practices". On Saturday, the government stepped up scrutiny of investments from companies based...
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Huge development.
 
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1,000 foreign firms mull production in India, 300 actively pursue plan as 'Exit China' mantra grows
Amid chances of China possibly losing its tag of preferred manufacturing hub following coronavirus, around 1,000 foreign companies are engaged in discussions at various levels with the Indian authorities. At least 300 of these companies are actively pursuing production plans in sectors such as mobiles, electronics, medical devices, textiles and synthetic fabric, according to top government sources.

These companies see India as an alternate manufacturing hub and have taken up their proposals across various levels of the government, including central government departments, Indian missions abroad and state industry departments. "About 1,000-odd companies are currently engaged in discussion at various levels such as investment promotion cell, central government departments and state governments. Out of these companies, we are targeting 300-odd companies," the official said.

"We are hopeful that once coronavirus is in control, a lot of things will fructify into actual relocation. And India will emerge as an alternate manufacturing destination. Many countries like Japan, US and South Korea are over-dependent on China and that is now very apparent," he added.

In a major push to domestic manufacturing, the Centre had in September last year slashed corporate tax to 25.17 per cent. For new manufacturers, the applicable tax was brought down to 17 per cent making it the lowest in South East Asia. Together with reduced tax rate and the roll-out of goods and services tax (GST), India hopes to attract sizeable foreign investment in the manufacturing sector.

It has now directed its focus on reducing the cost of production. With China in the firing line over its way of handling the deadly virus outbreak, major countries are expected to nudge their corporations to relocate production units out of China or set up new units at alternative locations.

In what appears to be early signs of possible changes in geopolitics, US President Donald Trump has questioned China over its response to the outbreak of the deadly virus. China had strongly protested Trump's "China virus" remark but the American President has been lashing out at the country unabated.

On Saturday, the US President said during a White House briefing that the virus "could have been stopped in China before it started and it wasn't, and the whole world is suffering because of it."

Meanwhile, Japan has announced $2 billion financial aid for its companies to shift production out of China. Many more countries could follow Japan, which is expected to benefit India. "Now the world is rethinking its strategy of putting all eggs in one basket. A lot of interest is being shown by companies towards India," says Guruprasad Mohapatra, Secretary in the Department for Promotion of Industry and Internal Trade (DPIIT).

"India is generally considered an attractive destination because of its market size and also India being a possible hub for exports in the region. That's the reason FDI has been recording very impressive growth in the last 5-6 years," he added.

While government is making all-out attempt to hard-sell India as a manufacturing hub it may find it an uphill task given that the production cost difference between India and South East Asian countries is about 10-12 per cent.

The government, however, sees large market size of India as a big plus for manufacturers. "If you manufacture mobiles in Vietnam, what do you do with them? You have to essentially export. You can't sell there as there is no local market," an official involved with the government's Make-in-India initiative said.

He explained giving an example of mobile phones. "There is a huge market in India for mobile phones that cost less than $100. For mobiles costing $200 or more there is huge potential of export. So, from the 10-12 per cent (percentage cost difference between India and South East Asia), almost 6-7 per cent is negated or adjusted by India's market itself. For the remaining 5-6%, a combination of state incentives and central incentives are there," he added.
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1,000 foreign firms mull production in India, 300 actively pursue plan as 'Exit China' mantra grows

These companies see India as an alternate manufacturing hub and have taken up their proposals across various levels of the government, including central government departments, Indian missions abroad and state industry departments
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Why allowing refiners to fill storage caverns is a win-win plan

By Richa Mishra
New Delhi | Updated on April 19, 2020 Published on April 19, 2020
1587450847401.png

A view of the cavern facility to store crude oil, built by Indian Strategic Petroleum Reserve Ltd.

Move aims to leverage low global crude prices; monsoon could play spoilsport, though

After many missed opportunities, India seems to have finally woken up to the importance of crude oil storage. Taking advantage of low global oil prices and to ensure that domestic public sector refiners do not default on their purchase agreements, the Ministry for Petroleum & Natural Gas has allowed them to use the strategic petroleum reserves (SPRs) for storing their purchases as well as to buy for the government.

“We have started filling our strategic reserves at the government’s cost. Three vessels have already come and the target is to get 10-11 more such large crude vessels in the next 40 days or so,” a senior government official told BusinessLine.

Short time-window

Oil guzzlers such as India cannot have better days than now for filling their storage capacities with cheap crude oil. On April 16, the cost at which Indian refiners bought their crude oil was about $20 a barrel.

But the challenge for India is the short time-window available to ship the buys to the storage facilities if the monsoon breaks on time. “The offloading at Mangaluru may not happen if monsoon breaks. Indications are that it will need to be shut for almost four months after May 22,” the official said.

Besides, each cavern can take only a specific grade of crude so that consistency is maintained. Though India has only 5.33 million tonnes (mt) of SPR capacity across three locations — 1.3 mt at Visakhapatnam, 1.5 mt at Mangaluru and 2.5 mt at Padur (Karnataka) – what is imperative is to make full use of this cheap oil opportunity while it lasts.

Avoiding delay in offloading

The move will also allow domestic refiners such as Indian Oil Corporation, Bharat Petroleum Corporation, Hindustan Petroleum Corporation and Mangalore Refinery and Petrochemicals Ltd to fill the caverns with their surplus buys so that the quantity already contracted for is not left floating in high seas. Additionally, it will ensure that the refiners do not end up defaulting on their payments to the sellers and pay higher for delays in offloading.

The storage facility at Visakhapatnam is almost full and HPCL has been asked to fill the remaining capacity there.

Petroleum Minister Dharmendra Pradhan, when recently when reviewing the country’s strategic petroleum reserve programme, instructed India Strategic Petroleum Reserves Ltd (ISPRL) to augment the storage of crude. ISPRL is a special purpose vehicle under the Ministry mandated to build and operate SPRs.

Taking stock

Pradhan tweeted recently: “We are going the extra mile to meet India’s energy security in spite of #Covid-19 challenge. More crude oil cargoes, at low prices, are lined up to reach Mangalore port during April and early May to completely fill the Mangalore and Padur SPRs. Taking advantage of the low crude oil price, India is filling the strategic petroleum reserves to their full capacity. The first consignment of 1 million bbls of crude procured through @IndianOilcl unloaded at Mangalore SPR...”

Yan Chong Yaw, Director, Refinitiv Oil Research, said: “India has sought to take advantage of the low-price oil environment by filling its SPRs. Despite the recent agreement by the OPEC+ alliance to cut production by an unprecedented 9.7 million bpd in a bid to shore up prices, the global glut in supplies, due to massive demand destruction in the wake of the Covid-19 outbreak, is still so high that prices will remain low enough to be attractive for the government to fill its three SPR sites in the South that can store up to 36.87 million barrels.”

Fall in demand

“A month ago, when oil prices first collapsed following a disagreement between OPEC and Russia over output cuts, Indian refiners had taken advantage by buying extra barrels, leading to record-high imports for March at 20.3 million barrels, based on Refinitiv Oil Research assessments. This move has since backfired when Covid-19 exploded through the country, forcing a nationwide lockdown that severely curbed air travel, vehicle movement and industrial activity,” he said.

“Refineries have to shut down capacity to cope with the devastating demand losses. To date, about 1.4 million bpd of capacity, or about a third of the country’s 5 million bpd capacity, has been shut amid declarations of force majeure on lifting of crude oil cargoes.”

Why allowing refiners to fill storage caverns is a win-win plan
 
The best thing is now the excuse of falling economy and not reaching the 5 trillion mark can be blamed on Made in China corona. Looks like many countries outsourced virus production to China to control the political fallout and civil unrest in the world. Cheap and effective. ;) :D
 
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Why allowing refiners to fill storage caverns is a win-win plan

By Richa Mishra
New Delhi | Updated on April 19, 2020 Published on April 19, 2020
View attachment 15497
A view of the cavern facility to store crude oil, built by Indian Strategic Petroleum Reserve Ltd.

Move aims to leverage low global crude prices; monsoon could play spoilsport, though

After many missed opportunities, India seems to have finally woken up to the importance of crude oil storage. Taking advantage of low global oil prices and to ensure that domestic public sector refiners do not default on their purchase agreements, the Ministry for Petroleum & Natural Gas has allowed them to use the strategic petroleum reserves (SPRs) for storing their purchases as well as to buy for the government.

“We have started filling our strategic reserves at the government’s cost. Three vessels have already come and the target is to get 10-11 more such large crude vessels in the next 40 days or so,” a senior government official told BusinessLine.

Short time-window

Oil guzzlers such as India cannot have better days than now for filling their storage capacities with cheap crude oil. On April 16, the cost at which Indian refiners bought their crude oil was about $20 a barrel.

But the challenge for India is the short time-window available to ship the buys to the storage facilities if the monsoon breaks on time. “The offloading at Mangaluru may not happen if monsoon breaks. Indications are that it will need to be shut for almost four months after May 22,” the official said.

Besides, each cavern can take only a specific grade of crude so that consistency is maintained. Though India has only 5.33 million tonnes (mt) of SPR capacity across three locations — 1.3 mt at Visakhapatnam, 1.5 mt at Mangaluru and 2.5 mt at Padur (Karnataka) – what is imperative is to make full use of this cheap oil opportunity while it lasts.

Avoiding delay in offloading

The move will also allow domestic refiners such as Indian Oil Corporation, Bharat Petroleum Corporation, Hindustan Petroleum Corporation and Mangalore Refinery and Petrochemicals Ltd to fill the caverns with their surplus buys so that the quantity already contracted for is not left floating in high seas. Additionally, it will ensure that the refiners do not end up defaulting on their payments to the sellers and pay higher for delays in offloading.

The storage facility at Visakhapatnam is almost full and HPCL has been asked to fill the remaining capacity there.

Petroleum Minister Dharmendra Pradhan, when recently when reviewing the country’s strategic petroleum reserve programme, instructed India Strategic Petroleum Reserves Ltd (ISPRL) to augment the storage of crude. ISPRL is a special purpose vehicle under the Ministry mandated to build and operate SPRs.

Taking stock

Pradhan tweeted recently: “We are going the extra mile to meet India’s energy security in spite of #Covid-19 challenge. More crude oil cargoes, at low prices, are lined up to reach Mangalore port during April and early May to completely fill the Mangalore and Padur SPRs. Taking advantage of the low crude oil price, India is filling the strategic petroleum reserves to their full capacity. The first consignment of 1 million bbls of crude procured through @IndianOilcl unloaded at Mangalore SPR...”

Yan Chong Yaw, Director, Refinitiv Oil Research, said: “India has sought to take advantage of the low-price oil environment by filling its SPRs. Despite the recent agreement by the OPEC+ alliance to cut production by an unprecedented 9.7 million bpd in a bid to shore up prices, the global glut in supplies, due to massive demand destruction in the wake of the Covid-19 outbreak, is still so high that prices will remain low enough to be attractive for the government to fill its three SPR sites in the South that can store up to 36.87 million barrels.”

Fall in demand

“A month ago, when oil prices first collapsed following a disagreement between OPEC and Russia over output cuts, Indian refiners had taken advantage by buying extra barrels, leading to record-high imports for March at 20.3 million barrels, based on Refinitiv Oil Research assessments. This move has since backfired when Covid-19 exploded through the country, forcing a nationwide lockdown that severely curbed air travel, vehicle movement and industrial activity,” he said.

“Refineries have to shut down capacity to cope with the devastating demand losses. To date, about 1.4 million bpd of capacity, or about a third of the country’s 5 million bpd capacity, has been shut amid declarations of force majeure on lifting of crude oil cargoes.”

Why allowing refiners to fill storage caverns is a win-win plan
Click to expand...
36.87 million barrels are not even a week worth of India consumption level while IEA recommend countries hold about 90 days worth of oil in SPR at minimum.
Indian establishment has a IQ equal to that of cow or donkey. little bit money from gulf to filthy politicians and all projects are scuttle. India should have digged holes to fill 20 years worth of crude oil... par na ji desh waloon ki hi bund Marni hai sab ne mil ke.
 
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Global firms look to shift from China to India

Updated: 22 Apr 2020, 12:25 AM IST
By Malyaban Ghosh, Biman Mukherji

Global manufacturers have initiated talks with Indian firms to explore the possibility of shifting a part of their supply chains from China as they seek to diversify their operations following the covid-19 outbreak
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Part of the demand is also coming from Indian firms who were reliant on China for sourcing components (Photo: Mint)

NEW DELHI : Global manufacturers have initiated talks with Indian firms to explore the possibility of shifting a part of their supply chains from China as they seek to diversify their operations following the covid-19 outbreak.

Most of these multinationals have suffered widespread disruptions to their businesses as authorities enforced strict lockdown measures to contain the pandemic, which originated in Wuhan city in China’s Hubei province. Wuhan is one of China’s so-called “motor cities", housing several automotive factories.

First of the lot are companies interested in sourcing automobile components and electronic products from India, according to industry executives.

Pankaj Munjal, chairman and managing director of Hero Motors Co., said the auto parts maker has received several enquiries from companies who have operations in China, but now want to de-risk their supply chain.

“A lot of supply chain was coming from China and today when we meet these customers and large OEMs (original equipment makers), some of them will migrate to countries like India, Vietnam and others. So, I believe, that will be a growth opportunity and we will see a migratory growth in supply chain," Munjal said.

Part of the demand is also coming from Indian companies who were heavily reliant on China for sourcing components, but suffered because of the novel coronavirus-induced disruption in China, which, over the years, has emerged as a manufacturing powerhouse.

To be sure, the government has still to announce new measures to woo firms planning to move operations from China. Earlier this month, Japan earmarked $2.2 billion to help its companies shift production out of China following the coronavirus pandemic.

In March, India’s cabinet announced a production-linked incentive (PLI) scheme for the electronics sector with an outlay of over ₹40,000 crore. “There is a clear negative sentiment against China. We have received requests for supply from India," said Amrit Manwani, president of Electronic Industries Association of India. “If we play our cards right, we could double our exports (of electronic products) in three years’ time."

India exports electronic products worth $9 billion each year, while its domestic market is estimated at $120 billion. “We don’t see so much interest from Europe, but definitely from US, there is a shift since the beginning of the year," Manwani said, adding that Japanese and South Korean firms are also interested in developing supply chains from the country.

Among global firms that have shown interest in India are US-based makers of medical electronics products Teledyne and Amphenol, and medical equipment makers such as Johnson and Johnson, Manwani said.

Vinod Sharma, managing director of Deki Electronics and chairman of electronics national panel at Confederation of Indian Industry, said his company is in talks with a South Korean firm for a tie-up to make electronic parts. Sharma, however, said government guidelines on threshold investment levels in electronic component manufacturing are proving to be an irritant.

At home, most local firms are actively looking for alternative sources to China and are bound to reduce imports from there though the process is expected to be gradual.

Most auto firms import parts like fuel-injection systems for the latest engines and other electronic parts from China. “In the next few months, we will see most of these Indian vehicles makers localize manufacturing of such parts or sourcing them from a different location with a foreign partner," said the executive requesting anonymity.

Global firms look to shift from China to India
 
OPEC Producers See Market Share Evaporate In India

By Tsvetana Paraskova - Apr 23, 2020, 10:30 AM CDT

The world’s third-biggest oil importer, India, saw its imports from OPEC producers slump to a 19-year-low in the fiscal year 2019/2020 ended in March, Reuters reported on Thursday, citing data from trade and industry sources.

At the same time, India imported more oil from the United States, the Mediterranean, and Latin America.

India's refiners have been seeking to diversify their 80-percent oil import dependence that they have OPEC, and lately, there has been a favorable price spread between Brent Crude and WTI Crude, making imports from the US particularly attractive.

In the fiscal year through March 2020, India’s crude oil imports from OPEC accounted for 78.3 percent of all imports, according to Reuters estimates—the lowest OPEC share in India since at least 2001/2002.

India’s imports from Middle Eastern oil producers alone accounted for 60 percent of all imports in 2019/2020, down from 63 percent in the previous fiscal year.

Imports from the United States represented 4.5 percent of India’s crude imports, up from 3 percent in the prior fiscal year. The U.S. became the seventh biggest oil supplier to India in the year through March 2020, climbing up from the 9th place in the top suppliers’ list in 2018/2019, according to the data compiled by Reuters.

India had already boosted its imports of U.S. crude oil after the United States ended the waivers for Iranian oil customers when it stepped up the sanctions pressure on Iran’s regime last year.

Most recently, in India’s nationwide lockdown to contain the pandemic, demand for oil in the country has plunged while storage capacity fills up. Due to plummeting fuel demand and overflowing storage capacity, at least three oil refiners in India have asked for lower crude oil imports for May from the Middle East, including from the world’s top exporter, Saudi Arabia, officials at the refiners told Reuters on Wednesday.

OPEC Producers See Market Share Evaporate In India | OilPrice.com
 
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India’s steel consumption hits 100 MT mark for the first time

CNBC-TV18
April 24, 2020 07:09 PM IST
By Anshu Sharma
1587794673949.png


As per the provisional data for FY20, India’s steel consumption has hit 100 million tonnes (MT) mark for the first time in the fiscal. India also remained a net exporter of steel with an increase of 31.4 percent; the import of steel was down 13.6 percent with a huge decline in steel import from China at 22 percent in FY20.

India’s crude steel production was down by 1.5 percent and finished steel production was flat at 109.2 MT in FY20 against 110.9MT in FY19. Domestic requirements of steel were met from domestic supply, as a share of imports in domestic consumption remained at low at 6.8 percent in FY20 versus 7.9 percent in FY19.

As global steel prices remained on the lower side due to COVID-19 impact, domestic prices were impacted by local supply-demand imbalance and global trends.

India’s steel export is up by 31.4 percent as it exported 8.3 MT of steel in FY20 against 6.3 MT in FY19, while imports are down by 13.6 percent at 6.7MT against 7.8 MT in FY19. The decline in steel imports from China by 22 percent in FY20, led to an increase in Korea’s steel export, making it a 40 percent share in India’s import, followed by Vietnam at 28 percent.

The trade deficit concerns continue for India, as it imported steel worth Rs 44,683 crore against the export value of Rs 36,726 crores.

India’s steel consumption hits 100 MT mark for the first time
 
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Few people expressed IT Sector to be on rise once this is over in response to my question. Can they elaborate how and from where IT will get orders when US and whole world economy is tanking?
 
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Tax officers' body moots COVID cess, minimum income scheme in plan to boost revenue, economy - CNBC TV18

Business News: Get the latest Business News, Live Share & Stock Market Updates, Top News from India and across world. Read Top Business News and updates on financial, economic and banking news on CNBCTV18.
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When socialist taxman thinks about the economy you get these idiotic gems. This is like the story of the blind man and the elephant. If you had asked a general the same he would have recommended to fast track all military acquisitions.
 
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Tax officers' body moots COVID cess, minimum income scheme in plan to boost revenue, economy - CNBC TV18

Business News: Get the latest Business News, Live Share & Stock Market Updates, Top News from India and across world. Read Top Business News and updates on financial, economic and banking news on CNBCTV18.
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When socialist taxman thinks about the economy you get these idiotic gems. This is like the story of the blind man and the elephant. If you had asked a general the same he would have recommended to fast track all military acquisitions.
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Frankly, I've given up hope of this government ever getting it's moorings right on the economy. And defense too for that matter. This would eventually be it's Achilles heel. Till that time there are other pressing national security & dharmic issues which I hope they'd resolve before they'd inevitably be out like implementation of the NPR followed by the NRC, identification of Bangladeshi muslim illegal immigrants & stripping them off citizenship , the UCC, some form of anti conversion law, retaking of PoJ&K along with Chitral right up to the Wakhan, amendment of the RTE, relook at the minority institutions, hand over control of temples back to the community, etc.
 
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