OPPORTUNITIES , CHALLENGES AND MARKET BREAKTHROUGHS TO EXPORT IN - - PowerPoint PPT Presentation

OPPORTUNITIES , CHALLENGES AND MARKET BREAKTHROUGHS TO EXPORT IN ASIA (INDIA) MARKET

INTRODUCTION

• India

and Indonesia have shared two millennia

• f

close cultural and commercial contacts. The shared culture, colonial history and post-independence goals of political sovereignty, economic self-sufficiency and independent foreign policy have a unifying effect on the India- Indonesia relations

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• India has reached demographic transition

stage wherein more than 60 percent of the population comprises of economically active age group of 15-59 years, commonly referred to as the

DEMOGRAPHIC DIVIDEND

• Indonesia ranks No.10 amongst Top 25

importers of India

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G 20 Summit 2019

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• The leaders of India and Indonesia, who

were in Osaka, Japan for the G20 Summit, met and discussed ways to boost bilateral ties and enhance cooperation in trade and investment.

• According to Ministry of External Affairs

India spokesperson Raveesh Kumar, India and Indonesia set a $50 billion target for bilateral trade by 2025.

G 20 Summit 2019

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OPPORTUNITIES FOR EXPORTING TO INDIA

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• English Widely Spoken

English speaking India overcomes the Language barrier and helps the trade to move in a more efficient and fast manner.

• Common Law

The Constitution of India is the supreme law of

• India. It provides details of the administration of

both the Union and the States, and codifies the relations between the Federal Government and the State Governments.

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• Rising personal incomes creating a new middle

class consumer market India's middle class is set to grow rapidly from up to 80 million today to 580 million people – or about 41 per cent of the population – by 2025.

• Fastest growing economy with one of the

world’s largest youth population India is home 20% of the world's youth. Half of its population of 1.3 billion is below the age

• f 25, and a quarter is below the age of 14.

India’s young population is its most valuable asset.

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• Purchase Power Parity
• While China ($27.4 trillion) is the largest

economy in the world in terms of PPP , the United States ($21.4 trillion) comes a distant second. India is a distant third, with a GDP adjusted to PPP at $11.4 trillion.

• However, in terms of nominal GDP

, the United States is the largest economy in the world followed by China. Japan is the third largest economy while Germany and India occupy the fourth and fifth positions in the world.

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• GDP comparisons using PPP are arguably

more useful than those using nominal GDP when assessing a nation's domestic market because PPP takes into account the relative cost of local goods, services and inflation rates of the country, rather than using international market exchange rates which may distort the real differences in per capita income.

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• Palm Oil Imports
• India Imports worth $5.5 billion of Palm
• il which is about 17.5% of total Palm oil

imports India has agreed to reduce import duties

• n Indonesian processed palm oil to 45

per cent bringing about parity with imports from Malaysia.

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• Availability of Skilled and Low cost

Labour India possesses a large labor pool as almost half its population of 1.2 billion is

• f working age. Naturally, the structure
• f India’s labor market is diverse; foreign

companies need to understand this structure to benefit from India’s demographic dividend.

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FUTURE PROSPECTUS OF INDIA

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• Good Networks of Banks, Financial

Institutions and an Organized Capital Market. India has a diversified financial sector undergoing rapid expansion, both in terms of strong growth of existing financial services firms and new entities entering the market. The sector comprises commercial banks, insurance companies, non-banking financial companies, co-operatives, pension funds, mutual funds and other smaller financial entities.

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• Gems and Jewellery Industry in India

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EXPORT TO INDIA BREAK THROUGHS

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• Ease of Doing Business

India climbed 23 points in the index to 77th place in 2019, becoming the top ranked country in South Asia for the first time and third among the BRICS.

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• Digitalization

Indian Government launched the revolutionary reform Digitization in India in September 2015, under which it envisioned increased internet connectivity and making India a digitally empowered nation.

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• Foreign Direct Investment Policies

Investment climate in India has improved considerably since the opening up of the economy in 1991. This is largely attributed to ease in FDI norms across sectors of the economy. India, today is a part of top 100 club on Ease of Doing Business (EoDB) and globally ranks 1st in the greenfield FDI ranking.

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• Some of The sectors in Which 100% FDI

is allowed are as follows:

• 1. Agriculture & Animal Husbandry
• 2. Air Transport Services (non-scheduled and
• ther services under civil aviation sector)
• 3. Airports (Greenfield & Brownfield)
• 4. Automobiles
• 5. Biotechnology (Greenfield)
• 6. Broadcast Content Services (Up-linking of Non-

‘News & Current Affairs’ TV Channels/ Down- linking of TV Channels)

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7.Broadcasting Carriage Services.

• 8. Capital Goods
• 9. Cash & Carry Wholesale Trading/Wholesale

Trading (including sourcing from MSEs)

• 10. Chemicals
• 11. Coal & Lignite
• 12. Construction Development: Townships, Housing,

Built-up Infrastructure

• 13. Construction of Hospitals

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• 14. Credit Information Companies (CIC)
• 15. Duty Free Shops
• 16. E -commerce activities
• 17. Electronic Systems
• 18. Food Processing
• 19. Gems & Jewellery (Manufacturing)
• 20. Healthcare (Greenfield)
• 21. Industrial Parks (new and existing)

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• 22. Pharmaceuticals (Greenfield)
• 23. Petroleum & Natural Gas
• 24. Plantation Sector
• 25. Ports and Shipping

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• NITI Aayog

NITI Aayog is a State-of-the-art Resource Centre, with the necessary resources, knowledge and skills, that enables it to act with speed, promote research and innovation, provide strategic policy vision for the government, and deal with contingent issues. NITI Aayog’s entire gamut of activities can be divided into four main heads:

• 1. Design Policy & Programme Framework
• 2. Foster Cooperative Federalism
• 3. Monitoring & Evaluation
• 4. Think Tank and Knowledge & Innovation Hub

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INDIA THREE YEAR ACTION AGENDA 2017-18 TO 2019-20

The action Agenda is divided into 7 broad parts:

• Medium-Term Revenue and Expenditure

Framework

• Economic Transformations in Major Sectors
• Regional Development
• Growth Enablers
• Government
• Social Sectors
• Sustainability

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• Taxation

Reduction in Corporate Tax Rates The corporate tax rates have been slashed with effect from this fiscal year, but there is an option to choose the reduced corporate tax rates and if

• ne chooses that option, then the company

cannot avail the incentives and exemptions. In

• ther words, it is an irreversible choice.

If that choice is adopted, there is no MAT either (the rate for other companies opting for lower tax rate is now slashed from 21.55% to 17.47% inclusive of surcharge and cess).

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• After the reduction the rate has become

significantly comparable to rates in other Asian countries.

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• Duty Draw Back
• 1. Section 74 and 75 of Customs Act1962
• 2. Re-export of imported goods (Drawback
• f Customs duties) Rules, 1995
• 3. The Customs and Central Excise Duties

Drawback Rules, 2017

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HOW TO ENTER INDIA

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CHALLENGES FOR EXPORTING TO INDIA

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• High Tariffs and Protectionist Policies

Like any other country even India for protecting its domestic market keeps in place various polices and Tariffs on import of Goods. However Government in order to improve bilateral trade between Nations have entered into Multiple agreements and MOU’s with respect of the Import Tariff and procedures with different nations

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• Local Government

Local governments vary in their attitude, ability, and capacity to support business and industry.

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• Bureaucratic Hurdles

Bureaucratic means involving complicated rules and procedures which can cause long delays. NRIs generally do not invest in manufacturing units in India because of bureaucratic hurdles and the lack of transparency and accountability at all levels.

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• Developing Infrastructure, Including distribution

and logistics as much of India remains Rural Improving the country’s infrastructure can lead to better connectivity, which in turn can create more jobs and enable free flow of trade. India Ranks 44 in The LPI (Logistic Performance Index) is an interactive benchmarking tool created to help countries identify the challenges and opportunities they face in their performance

• n trade logistics and what they can do to

improve their performance. The LPI 2018 allows for comparisons across 160 countries

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• Weather Conditions

weather extremes with extremely hot weather in summer and wet weather in the monsoon season can affect business Climate change impact trade through a number of channels, not all of which can be easily quantified

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SUMMARY

• India to remain one of the fastest

growing economies in the world.

• Leading investors ranked India as the

most attractive market.

• Perfect Time to invest and trade in

India!!!

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COMPILED BY

Saurabh Shah – CEO Universal Business and Corporate Services Centre Tel No. : +91 22 22717700 +91 22 22701040 Website : www.ubcsc.co.in E mail ID : saurabhshah@ubcsc.co.in

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Thank You

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