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NEWS CLIPPINGS –01-11-2018
Investment Opportunities in India’s
Andhra Pradesh
India Briefing
https://www.india-briefing.com/news/investment-opportunities-indias-
andhra-pradesh-17881.html/
Located in the southeastern coast of India, Andhra Pradesh is the eighth largest state in the country in terms of
geographical expanse, and tenth largest in terms of population.
In 2018, the state topped the ‘ease of doing business’ ranking among states prepared by the World Bank and the
Department of Industrial Policy and Promotion (DIPP). It also ranked among top ten investment destinations in
the National Council for Applied and Economic Research (NCAER)’s 2018 State Investment Potential Index (N-SIPI).
Below, we look at the state economy, investment opportunities, and government incentives available for businesses
in Andhra Pradesh.
Economy
There is a strong economic momentum within Andhra Pradesh driven by a focus on the ease of doing business,
infrastructure development, and abundant natural resources.
In the fiscal year 2017-18, the state registered a gross state domestic productivity (GSDP) of US$ 123 billion with an
11.22 percent growth rate, which is higher than the overall national average.
Sector-wise, services accounted for the highest share in the state GSDP with a total of Rs1305.87 billion (US$17.7
billion), followed by industries with a total contribution of Rs507.45 billion (US$6.9 billion) and agriculture with
Rs545.99 billion (US$7.4 billion).
Chief exports
Andhra Pradesh is a traditional exporter of spices, processed seafood, garments, artificial jewelry, and leather goods.
The state is also one of the top exporters of software, and tobacco products.
Power capacity
Andhra Pradesh has the second largest power generating utility in the country with an installed capacity of around
23,000 MW. The two cheapest sources of thermal power generation – coal and natural gas – are found in
abundance.
They are several large power plants established in the state. The major ones are located at Visakhapatnam,
Vijayawada, Kakinada, Krishnapatnam, and Cuddapah.
Major industrial cities
Andhra Pradesh has 13 districts – out of these nine are located on the seacoast and have manufacturing and export
industries as their central industries. The major industrial cities in the state are:
Visakhapatnam
The city has several private and public-sector establishments producing large-scale industrial goods such as steel,
metals, petroleum, polymers, fertilizers, and heavy engineering equipment. The presence of public sector
enterprises such as Vizag Steel (RINL), BHPV, Vizag Shipyard, and HPCL have made the city predominantly an
industrial one.
Over the years, the information technology (IT) sector has also gained prominence in the city. Andhra Pradesh is one
of the nerve centers for manufacturing, IT, as well as tourism and services.
Vishakhapatnam is also home to several institutes of excellence in research and development, education, hospitality,
and governance.
Kakinada
Kakinada is known for its anchorage port and a deep-water port. The city has a 10,000-acre multi-product SEZ and
the Petroleum, Chemicals and Petrochemicals Investment Region (PCPIR). It also has multiple fertilizer refineries and
produces a large scale of natural gas. As a result, a number of gas-based thermal power projects have come up near
Kakinada in recent times.
The city’s chief exports include seafood and related products. It also produces agricultural products like rice and corn,
edible oils, processed food products, chemicals, and biofuel.
Vijayawada
Vijayawada is famous for processing of agricultural products, automobile body building, hardware, textile, consumer
goods, and small-scale industries.
Connectivity
Known as ‘Gateway to the East’, Andhra Pradesh has established itself as one of the major connection points with
important world markets in Asia such as Hong Kong, Singapore, Japan, and China.
Currently, Andhra Pradesh has 14 notified ports out of which six are operative. Visakhapatnam port is among the
country’s most premier ports in terms of total cargo traffic handled, with a total capacity of over 65 million tons (mt)
per annum. Gangavaram port, on the other hand, has a deep draft capable of handling the largest of vessels. In
addition to these, there two operational non-major ports — Kakinada, with a capacity of 10 mt and Krishnapatnam
with 15 mt.
Besides, AP has five operational airports – Visakhapatnam, Rajahmundry, Vijayawada, Tirupati, Kadapa, and
Puttaparthi; New Greenfield International Airport at Bhogapuram (Visakhapatnam district), Dagadarthi (Nellore
district); and domestic Airport at Orvakal (Kurnool district).
It also has a 46,000 km of the road network with 4,300 km of national highways running through the state, 7,040
track km of the rail network, and about 888km of the national waterway.
Investment opportunities
Andhra Pradesh is among the top ten most preferred destinations for investment in India. The state is known for its
business-friendly policies and simplified administrative procedures.
It has several special economic zones (SEZs), and industrial corridors offering world-class infrastructure to
manufacturing and service industries.
Special economic zones
There are 114 approved SEZs in the state – of these 75 are notified, and 27 have become operational. The SEZs are
present across diversified sectors including textiles and apparel, food processing, footwear and leather products,
multi-product, pharmaceutical, and information technology, among others.
Industrial parks:
Much of the investment in Andhra Pradesh goes into Sri City and Anantapur district. Sri City, located just 65 km north
of Chennai, is a 7,000-acre private industrial park. The park is home to over 80 global companies with a cumulative
investment of Rs 25,000 crore (Rs 250 billion).
Other industrial parks located in the state are listed below:
Export Promotion Industrial Park, Pashamylaram, Medak District;
Apparel Export Park, Gundlapochampally, Ranga Reddy district;
Food Processing Industrial Park At Kuppam, Chittoor District;
HITEC city( Hyderabad Information Technology And Engineering Consultancy);
Mega Industrial Park At Parwada, Visakhapatnam;
Visakhapatnam Export Processing Zone;
Gems and Jewellery Park, Hyderabad; and
Visakhapatnam Exim Park.
Industrial corridors
The government is building three industrial corridors across the state:
Visakhapatnam Chennai Industrial Corridor, covering 11 districts of the state;
Chennai Bengaluru Industrial Corridor, with the industrial node at Krishnapatnam in Nellore district; and
Kurnool Bengaluru Industrial Corridor, with the industrial node at Orvakal in Kurnool district.
These corridors offer a massive opportunity for the establishment of manufacturing units across the following
industrial sectors: pharmaceuticals, electronics, machinery, hi-tech engineering, electronics, automobile, food
processing, textiles, building materials, and machinery parts.
Andhra Pradesh also offers procedural ease for facilitating foreign direct investments (FDIs). Over the years, the state
has recorded a healthy FDI inflow, thanks to Fortune 500 companies, which have set up operations in the state.
According to data released by the DIPP, the state attracted FDI equity inflows worth US$ 16.487 billion during the
period April 2000 to June 2018.
Government incentives
An investor-friendly state, Andhra Pradesh, has initiated several policy measures and incentives to provide a
conducive business environment to investors. Some of these are given below:
Enactment of the industrial single window clearance policy – the single window system, mainstay of the reforms, is an
online platform available 24×7 for obtaining necessary regulatory clearances. Thorough the e-platform, companies
can get all necessary clearances to establish and operate an industry within 21 working days.
Self-certification based approvals – the state government grants as many as 15 approvals on the spot based on self-
certification by the investor.
Online application and sanction of incentives – the transparent process of applying and sanctioning of industrial
incentives
Sector-specific policies – the state government along with the federal government offers industry-specific incentives
under various schemes to sectors such as automobiles and auto components, petroleum, chemicals, (including
fertilizers) and petrochemicals, energy, leather, agro and food processing, textile and apparel, electronics and IT, and
mineral based industry. The incentives range from capital and interest subsidy, power, stamp duty, and tax
reimbursements, to financial assistance for patent registration.
International desks – the government has set up international desks to facilitate assistance to foreign investors.
Joint inspections – to ensure investor convenience, inspections of several departments such as labor and factories are
combined into one inspection.
Cotton and Currency Markets
Kotak Commodities Research Desk
For more details contact : Research@kotakcommodities.com &
aurobinda.gayan@kotakcommodities.com
A. Cotton
Spot price (Ex-Gin) 28.5 to29 mm
Rs/Bale Rs/Candy USD Cent/lb
22134 46300 80.41
Domestic Futures (Ex-Gin) July
Rs/Bale Rs/Candy USD Cent/lb
22390 46835 81.34
International Futures
NY ICE USD Cents/lb. ( Dec 2018) 76.86
ZCE Cotton: Yuan/MT (Jan 2019) 14860
ZCE Cotton: USD Cents/lb. 82.29
Cotlook A Index - Physical 87.75
B. Currency
USD/INR Close Previous Close
Spot 73.445 73.468
Cotton Guide:
Market remained quiet on Wednesday. No interesting news on Cotton. The trading volumes were stable. For ready
reckoner the December future trades at ICE is still considered to have the highest open interests traded in a thinnest
band and ended the session at 76.86 cents mere down by 4 points from the previous day’s close. The next active
March 2019 contract also declined to end the session at 78.17. However the spread between the two contracts in last
one month has widened marginally from less than 1 cent to currently hovering around 1.50 cents. The carry has
increased the effect of contango amid funds roll over positions. As indicated in our previous report Rogers’ Fund Roll
and a few others are currently scheduled to roll their positions precisely cut long in December and park in March.
This is one of the reasons why cotton price has declined in last 10 days or so.
On the pricing front market is just trading above the key support area of 76 cents. The current momentum and
direction is into sell side however only on break down below 76 cents will determine further decline in the price. The
next support can be considered at the previous low of 75.37. Note by any means if the previous low is breached
further selling in the counter could be witnessed. Likewise, on the higher side we 77.50/78 cent as key resistance
level. For more details please contact commodities research desk.
FX Guide:
Indian rupee has opened firmer by 0.15% to trade near 73.84 levels against the US dollar. Rupee has benefited from
weakness in crude oil price and some stability in equity market. Brent crude trades below $75 per barrel amid near
record high production by US, Saudi Arabia and Russia. Asian equity markets trade largely higher today after gains in
US market yesterday. Upbeat ADP jobs report and signs of progress in Brexit talks have improved risk sentiment. ADP
jobs report noted a 277K increase in US private sector jobs in October as against forecast of 187K increase. The Times
of London reported that UK financial services companies will get continued access to European Union markets after
Brexit. The US dollar index has also come off the highs as Pound strengthened on reports of Brexit progress.
However, weighing on rupee are tensions between RBI and government, slowdown in Chinese economy which dents
outlook for emerging markets and challenges to global economy. Indian government issued a statement yesterday
supporting autonomy of RBI however market nervousness persists. Rupee has opened on a firmer note but the gains
may not sustain as general optimism about US will support US dollar. USDINR may trade in a range of 73.6-74.05 and
bias may be on the upside.
India, Japan to expand special strategic
and global partnership
Domain.com
https://www.domain-
b.com/defence/general/20181030_global_partnership.html
India and Japan have committed themselves to working together to promote peace, stability and prosperity, through
economic growth and development in the Indo-Pacific, including Africa, by enhancing connectivity through quality
infrastructure and capacity building of our partners.
Both countries emphasised that all development cooperation must be carried out in an open, transparent and non-
exclusive manner and based on international standards, including respect for sovereignty and territorial integrity of
nations, responsible debt financing practices, and in alignment with local economic and development strategies and
priorities.
By synergising India’s "Act East Policy” and Prime Minister Modi’s 10 guiding principles for India’s sustained and
regular engagement with African countries, with Japan’s "Expanded Partnership for Quality Infrastructure Initiative”
and TICAD VI Nairobi declaration, the two countries welcomed and committed to further consultations with host
governments to foster tangible cooperation focusing on development of connectivity and other infrastructure in the
Indo-Pacific. India and Japan welcomed progress in identification of specific cooperation, including but not limited to
the following:
Cooperation in Sri Lanka, such as the development of LNG-related infrastructure;
Cooperation in Myanmar, synergizing development efforts in the Rakhine State by collaborating in housing,
education and electrification projects;
Cooperation in Bangladesh, for enhancing connectivity by way of four-laning of road and reconstruction of bridges on
the Ramgarh to Baraiyarhat stretch, and providing rolling stock and constructing the Jamuna Railway Bridge over the
Januma River; and
Cooperation in Africa, such as organising an SME development seminar in Kenya and seeking a possibility of a
collaborative project in the area of health service such as developing a cancer hospital in Kenya.
The two countries also acknowledged the importance of expanding cooperation in human resource development,
capacity building, healthcare, livelihood, water, sanitation and in the digital space, and of working together to extend
access to education, health and other amenities, and assist the people of the Indo-Pacific, including Africa, to realize
their developmental potentials.
Further, the two countries will work towards establishing an India-Japan Business Platform to enhance the exchanges
between Indian and Japanese businesses toward developing industrial corridors and industrial network in the region.
In this context, the two countries welcomed the memorandum of understanding between NEXI and ECGC, which is
expected to promote development of concrete India-Japan business projects in the region.
Both India and Japan said their development cooperation in the Indo-Pacific can contribute to unlocking the potential
for an equitable, positive and forward-looking change in the region, and contribute to socio-economic development
of Africa.
India-Japan `Act East Forum’
India’s North East Region is one of the main areas of India’s Act East Policy. The region also shares historical and
traditional bonds with ASEAN countries, and has the potential to be India’s springboard to the ASEAN region.
Enhancing connectivity within North East Region and with its neighbouring countries is essential to tap its potential
and presents crystallized examples of the shared vision between Japan and India as expressed in the Vision
Statement.
The Act East Forum established last year has served as a driving force to advance India-Japan cooperation in the
North-East. Its second meeting, held on 8 October decided to expediting implementation of Meghalaya North East
Connectivity by fast-tracking the following projects
Phase 1: Tura-Dalu (NH-51)
Phase 2: Shillong-Dawki (NH-40)
Mizoram North East Connectivity
Phase 1 & 2: Aizawl-Tuipang (NH-54)
Sikkim: Biodiversity Conservation & Forest Management
Nagaland: Forest Conservation Livelihood Improvement
Japan and India reaffirmed their intentions to proceed with the completion of Gelephu-Dalu Corridor in collaboration
with the ADB, including Dhubri/Phulbari bridge project, which will be the longest river bridge in India if realised, as
Phase 3 of North East Road Network Connectivity Improvement Project.
The will also consider developing main district roads and other district roads, which will have positive socio-economic
effect.
For skill development, the two countries will launch "Japan-India North East Bamboo Initiative” in view of the
significance bamboo plays in the region. Industrial uses of bamboos and bamboo forest management will be pursued
under this initiative, building on the successful first "North East Bamboo Workshop.
To promote Japanese language education in the North East as a part of the commitment made by the two prime
ministers to establish Japanese language certificate courses at 100 higher educational institutions in India. The forum
welcomed the interest for such courses expressed by cotton university and Gauhati University in Assam, EFLU in
Meghalaya state as well as NIT-N in Nagaland, to which Japan is prepared to provide appropriate support through
Japanese Language Teachers Training Centre. More proposals from North East states are welcome.
To promote skill training, including Japanese language for caregivers from North East who visit Japan for training
under TITP (Technical Intern Training Programme) ,which contributes to enhancing cooperation between the two
countries under the Asia Health and Wellbeing Initiative.
Smriti Irani unveils Fabric of Unity on
occassion of 143rd birth anniversary of
Sardar Patel
News on Air
http://www.newsonair.com/Main-News-Details.aspx?id=354716
Textiles Minister Smriti Zubin Irani today unveiled the Fabric of Unity on the occasion of the 143rd birth anniversary
of Sardar Vallabhbhai Patel in Gurugram in Haryana. She also flagged off the Unity March.
Later, she administered the Unity Pledge to the office bearers, staff of Apparel Export Promotion Council - AEPC and
students of Apparel Training and Design Centre - ATDC.
The Minister exhorted the AEPC to spread the concept of fabric of unity in its offices saying it will be a real tribute to
Sardar Vallabhbhai Patel.
She urged the AEPC to put together the entire history and the textile designs of the then princely states which were
united into the Indian Union by Sardar Patel.
Air monitoring system not in place, 40
units get notice
Tribune India
https://www.tribuneindia.com/news/haryana/air-monitoring-system-not-
in-place-40-units-get-notice/676892.html
The Haryana State Pollution Control Board (HSPCB) has served notice on 40 industrial units, asking their owners to
instal the Online Air Emission Monitoring System (OAEMS), as mandated by the Central Pollution Control Board
(CPCB).
As per an HSPCB report, the air quality of the city was poor for the past 15 days, as particulate matter (PM-10) was
recorded between 250 and 350 microgrms per cubic meters.
Sources say the CPCB has made it mandatory for industries registered under the red category (highly polluted units)
to instal the OAEMS so that the air quality can be monitored online by the HSPCB and CPCB regularly.
According to the national ambient air quality standards, ideally, the atmosphere must not contain more than 100
micrograms of particulate matter (PM) per cubic metres, but it was recorded at 250 micrograms in the city, said
Bhupender Singh Chahal, Regional Officer, HSPCB.
Major sources of air pollution are industries, vehicular emission, garbage burning, construction activity and stubble
burning.
In Panipat district, 398 textile industries under the red category and 93 brick-kilns are registered with the HSPCB.
About 20 brick-kilns have been lying closed for long reportedly for not meeting the norms.
“As of now, notices have been issued to units with a turnover of more than Rs5 crore,” Chahal said.
Gzb admin stops construction
activities, shuts polluting units
Daily Pioneer
https://www.dailypioneer.com/2018/state-editions/gzb-admin-stops-
construction-activities--shuts-polluting-units.html
In the backdrop of deteriorating Air Quality Index (AQI) and past orders of National Green Tribunal (NGT) the
Ghaziabad district administration has issued order to stop all the construction activities and polluting industrial units
in the district with immediate effect.
The district information officer revealed that the highly polluting industry ~Continental Carbon Limited~ has been
ordered to shut its production activities till further order.
The local residents were staging dharna outside the factory for the past one week. They alleged that the ash particles
are being spread during the production process of the unit when it burns crude oil to make carbon for the tyre
factories.
In its order the administration stated to shut all its construction activities in three main sites being carried by the
National Highway Authority of India (NHAI) on the expansion work on National Highway-24, flyovers at Vasundhara
and Raj Nagar extension being carried out by the state agencies.
The other polluting industrial units included Vardhman Thermopack GT Road, NG Textile prints Kavi Nagar Industrial
Area, Para Products site 4, Sahibabad, Rohini Chemicals site 4, Sahibabad, Ultima Decorative panels site 4, Sahibabad,
KR Foods Bulandshahr Industrial Area and VP Traders Meerut road industrial area Ghaziabad.
The orders has been enforced with immediate effect till November 30, a senior district administration official said.
Global garment workers exploited as
big brands pressure suppliers: report
Reuters
https://www.reuters.com/article/us-global-slavery-report/global-garment-
workers-exploited-as-big-brands-pressure-suppliers-report-idUSKCN1N51N1
India (Thomson Reuters Foundation) - Pressure by big brands on suppliers to deliver more quickly and cheaply
contributes to labor abuses in factories that manufacture garments, footwear and textiles, according to a report
published on Wednesday.
More than half the suppliers surveyed were affected by cost negotiation strategies that cut into their profits,
according to the report by Better Buying, a Delaware-based group that rates purchasing practices of brands and
retailers.
Suppliers, in turn, put pressure on workers, leading to abuses, according to the research, which was funded primarily
by the C&A Foundation, a funding partner of the Thomson Reuters Foundation for human trafficking and slavery
coverage.
The impacts on workers include excessive overtime, underpayment of benefits, insufficient wages, and use of
unauthorized sub-contractors, said Doug Cahn, a Better Buying co-founder.
“Understanding and reducing the negative impacts of purchasing practices is the missing link in the movement to
ensure decent conditions of work in supply chains,” Cahn said in an email.
The index included ratings from 319 suppliers across 38 countries and measured the performance of 67 retailers and
brands, including Esprit, Nike and Gap.
Supplier ratings indicated that one third of buyers did not pay bulk order invoices on time, according to the report.
More than 20 percent of the orders received from retailers or brands were not priced to cover the cost of social,
environmental, quality, and other compliance requirements.
“These practices create challenges for suppliers to pay their workers adequately and on time,” said Jill Tucker, Head
of Supply Chain Innovation & Transformation at the C&A Foundation.
“We hope that with type of insight, buyers will change their practices in a way that make it possible for benefits to
trickle down to workers.”
Pressure to deliver quickly has prompted the Tirupur Exporters Association to request workers in India’s textile hub in
Tamil Nadu state to take only one or two days off during the upcoming Diwali festival, rather than the entire week.
“The peak manufacturing season clashes with two big festivals - Diwali and Pongal,” said Raja M Shanmugham, the
association’s president.
Diwali, a Hindu celebration of lights, falls on Nov. 6 and 7, but workers traditionally take the whole week off, while
the harvest festival of Pongal is in January.
Buyers will cancel orders if deliveries are delayed, putting financial strain on suppliers, Shanmugham told the
Thomson Reuters Foundation by phone.
Margins of textile mills buoyed by
cotton price fall, but hurdles lie ahead
Business Standard
https://www.business-standard.com/article/companies/margins-of-textile-mills-
buoyed-by-cotton-price-fall-but-hurdles-lie-ahead-118103001112_1.html
Cotton prices in major producing centres such as Punjab and Madhya Pradesh have declined to nearly 10% below the
government's MSP
The profit margins of textile mills improved during the second quarter (July-September) of the current financial year.
Input costs were low, driven largely by a fall in cotton prices.
Leading players Welspun India, Trident and Vardhman Acrylic reported emphatic growth in turnover and net profit,
as did Raymond and Surat Textiles.
Welspun India, for example, posted a 21.4 per cent growth in net profit to around Rs 1.217 billion over the same
period last year. Sales grew 11 per cent to Rs 17.8 billion.
"Raymond's overall performance was above our expectations, driven by broad-based growth across divisions. Sales
increased 16 per cent, Ebitda (operating earnings) by 36 per cent and net profit by 63 per cent, above our
expectations. Management commentary was cautious on Q3 growth trends but it expects growth to improve from
Q4, due to the wedding season. While Raymond has maintained its 100 basis points (bps) margin expansion guidance
(estimate) for the year, we believe that upsides are likely, given the 190 bps margin expansion in the first half. Better
capacity utilisation in garmenting, higher gains from currency depreciation and continued focus on efficiencies should
drive margin expansion in the second half," says Ashit Desai, an analyst with Emkay Global.
These dynamics might change in the coming quarters with demand for cotton coming from Pakistan, China and other
importing countries at a time when the domestic natural fibre output is estimated to decline. As against the earlier
forecast of 36 million bales (a bale is 170 kg) of output, traders and industry experts now estimate cotton output at
33-33.5 million bales this year.
"Raw material prices remained subdued during the quarter, though cotton demand from domestic textile
manufacturers was robust, as mills needed to prepare stocks for the festival and seasonal demand in October-
November," said Ajay Kedia, managing director, Kedia Stocks and Commodity Research.
Cotton prices in major producing centres such as Punjab and Madhya Pradesh have declined to nearly 10 per cent
below the government's minimum support price of Rs 5,450 a quintal (of long staple). In August, these had fallen to
Rs 4,300 a quintal. At present, it is Rs 4,600 a quintal at spot markets in Gujarat.
China has since turned to India for import of cotton due to a higher import duty levied on its traditional supplier,
America. Pakistan is also likely to procure from India this year.
"Cotton farmers in Maharashtra and Gujarat are facing a double whammy. While a drought has reduced the output
potential, pink bollworm attack has further lowered production possibilities. This has come when demand from China
and Pakistan has suddenly emerged. Overall, Pakistan is looking a better and sustainable market for India than
China," said a city-based cotton exporter.
Meanwhile, a recent report from India Ratings forecasts robust demand for textiles from end-users in India,
supported by a strong rise in private consumption expenditure during the rest of this financial year. Also, apparel
export is likely to rise, with the rupee's fall against the dollar at a higher rate over April-August than the currencies of
other key exporting nations.
The rising dollar has also lowered the potential for cotton import into India, as imported cotton would now become
costlier than domestically available fibre.
Commerce Ministry to take up
exporters’ complaints on GST refund
with FinMin
Business Line
https://www.thehindubusinessline.com/economy/commerce-ministry-to-take-
up-exporters-complaints-on-gst-refund-with-finmin/article25372080.ece
Exporters say they must be allowed to switch from duty drawback to IGST refund
The Commerce Ministry has taken note of exporters’ complaints that the input duty refund under the duty drawback
scheme claimed by some last year was much lower than the IGST (Integrated Goods & Services Tax) refunds due to
them and it may ask the Finance Ministry to address the issue.
“Exporters have said that they are willing to pay back the drawback with interest and they should be instead given
IGST refund which is a much higher amount. The DGFT is likely to take up the matter with the Customs Department,”
a government official told BusinessLine.
Last year, when the GST regime was implemented, exporters were given the option of continuing with the popular
duty drawback scheme (at a higher rate for some items) for three months (July-September) if they agreed to forego
refund of IGST paid by them.
After a number of exporters opted for the duty drawback option, they discovered that the IGST paid by them on
inputs was much higher and opting for refunds under IGST would have been a better deal.
‘Initial confusion’
“In the initial period everyone was confused about GST impact. A number of exporters were not aware of the
implications and chose to be compensated for input taxes under the duty drawback scheme. Now when they
understand that GST refund would give them a much higher amount for many items, the government should oblige,”
said Ajay Sahai from the Federation of Indian Export Organisations (FIEO). Giving an example, Sahai said that for
vegetables the drawback rate is 1 per cent. So, if an exporter is shipping say cauliflowers to West Asia at ₹40 per kg,
he will get 40 paise as drawback. However, air freight is ₹100 per kg for cauliflowers and if the exporter is paying 5
per cent GST of ₹5 on that, then by opting for 40 paise of duty drawback, he is losing out on the ₹5 as GST refund.
“What is the problem in not giving him the ₹5 as GST refund if he is willing to refund the duty drawback he got
together with interest. The exporter is asking for what is rightly his,” Sahai said.
While the Finance Ministry has once refused to allow exporters to switch their stated preference, Commerce Ministry
officials say that they will take up the issue again. “Exporters need to be compensated fully for the input taxes paid as
it is vital to help them stay competitive in the global market,” they said.
Turkish Cargo sees ‘high potential’ in
Bangalore
Cargo News
https://www.aircargonews.net/news/airline/freighter-operator/single-
view/news/turkish-cargo-sees-high-potential-in-bangalore.html
Turkish Cargo has launched Airbus 330-200 freighter flights to Kempegowda International Airport in Bangalore, the
capital of India’s Karnataka state.
The freight-carrying division of Turkish Airlines pointed out that the Indian city has “a high annual export potential of
170,000 tons” that could benefit from the airline’s connections to destinations across the Middle East.
Bangalore’s aerospace, IT and high-tech industries are among the drivers of its exports, which also include
pharmaceuticals, fruits and vegetables electronic goods and textile products.
The Indian airport confirmed that Turkish Cargo would serve Bangalore twice a week.
Cotton drying unit at Malout grain
market non-functional
Tribune India
https://www.tribuneindia.com/news/punjab/cotton-drying-unit-at-
malout-grain-market-non-functional/676979.html
Set up in 2014 to increase the profit of cultivators, the state government’s cotton pre-cleaning and drying unit at the
grain market in Malout town is still non-functional.
This was the country’s first such plant set up to help farmers in sowing and picking cotton with machines, which is
negligible now.
Officials said the Rs 2-crore plant was installed to decrease the input costs by overcoming problem of expensive
labour
A farm implement-making company had carried out high-density cotton cultivation in the Malout and Abohar sub-
divisions in 2014. This plant was set up to help farmers, but it is lying non-functional for the past three years,” said
Gurpreet Singh, secretary of the Market Committee, Malout.
The entire process was to be done at a minimal cost as the government had launched this project on no-profit-no-
loss basis. It has the capacity of cleaning 6 tonnes cotton per hour.
The machinery will weed out leaves from the cotton crop. It will also lessen the moisture content as per requirement
and improve the quality of cotton fibre for marketing purpose.
Sources said the plant was once used to clean and dry normal variety of cotton, but after processing, cotton did not
come out. “The machine can work after repairs. We have deployed a watchman for it,” said the secretary of the
Market Committee.
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