Consulate General of India, Widenmayer Strasse 15,80538 Munich, Germany. Web: www.cgimunich.com

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India Economic News Consulate General of IndiaJuly 2013 Munich

Economic Report published by Ministry of Finance:

On June 26, a report of the Ministry of Finance detailed that the overall growth of Gross Domestic Product (GDP) of India, is estimated at 5 per cent in 2012-13 (provisional estimates) as compared to the growth of 6.2 per cent during 2011-12.Foreign Currency Assets stood at US$ 259.6 billion at end-May 2013 as compared to US$ 253.9 billion at end-May 2012.

Daimler India Commercial Vehicles exports first batch of 64 Fuso trucks to Sri Lanka:

Daimler India Commercial Vehicles (DICV), a wholly owned subsidiary of German

automotive giant Daimler AG, exported the first lot of 64 Fuso trucks manufactured at its Oragadam plant in the outskirts of Chennai. These trucks are headed towards Sri Lanka as part of the company's commitment to export to various countries in Asia and Africa. The Oragadam plant along with the Kawasaki plant in Japan will be Daimler's two global competence centers.

FDI by Indian Companies abroad rises to $ 7.64 billion:

According to data from the Reserve Bank of India (RBI), Foreign direct investment by Indian companies rose more than three times in April to $7.64 billion, from $1.89 billion in March. In April, as many as 499 deals were

Consulate General of India, Widenmayer Strasse 15,80538 Munich, Germany. Web: www.cgimunich.com

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carried out by Indian firms to carry out the outward foreign direct investment. Bharti Airtel, Oil and Natural Gas Corporation (ONGC) Videsh, Suzlon Energy, GMR Infrastructure, Amtek Auto and Tractors and Farm Equipment were among the major companies that invested in their foreign arms during the month.

India 3rd Largest market for Smartphones:

According to the latest research from Strategy Analytics, an independent research firm, India overtook Japan to become the world's third largest smart phone market by volume for the firsttime ever in the first quarter of this year with Samsung, Micromax and Apple among the major brands leading the market. Around 10 million smart phones were shipped in India during the first quarter, almost tripling from 3.8 million units a year earlier

Infrastructure projects worth One lakh crore announced:

Montek Singh Ahluwalia, Planning Commission DeputyChairman, during a

presentation, said that Ports in Andhra Pradesh and West Bengal, an elevated rail corridor in Mumbai, and locomotive projects in Bihar are among the key infrastructure projects worth around one lakh crores(equivalent to US$ 16.6 billion) to be kicked off in about six months.

CBDT softens the tax blow on contract R&D centres:

It was reported on June 30 that the fresh guidelines, forming part of a new circular, will help minimize litigation and could soften the tax blow on foreign companies offshoring R&D work to centres in India. The new circular modifies the earlier one which was seen to be too restrictive in terms of what would qualify as contract R&D centre with insignificant risk.

Industry Ministry looking at new FDI policy for pharma sector:

It was reported on June 30 that DIPP was looking at a new Foreign Direct Investment (FDI) policy for India which allows 100 per

Consulate General of India, Widenmayer Strasse 15,80538 Munich, Germany. Web: www.cgimunich.com

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cent FDI in the pharmaceutical sector, both in new and existing projects. “The alternative policy would look at ways to ensure that foreign acquisition of Indian companies do not lead to shifting of production capacities in a way that it affects availability of cheap generic medicines in the country,” the DIPP official was reported to have said.

EU timber norms stress right sourcing by paper industry:

The new European Union Timber Regulation, which has come into effect from March 2013, expects Indian paper industry, operators and traders to ensure that the products they place on the EU market are sourced legally from the country of harvest.Under the new regulation, placing illegally harvested timber and products derived from such timber on the EU market is prohibited.

51 low-cost small airports to come up:

It was reported that during decisions taken in a meeting chaired by Prime Minister Manmohan Singh, there were

plans to introduce pubic-private partnerships (PPPs) in the modernised Chennai and Kolkata airports among six others. It was also decided that 51 low-cost small airports would be taken up by the Airports Authority of India during 2013-14. The locations identified in Andhra Pradesh are Vijayawada, Nellore, Kurnool, Kadapa, Nizamabad, Tirupati, Anantapur and Karimnagar, while for Uttar Pradesh, the locations are Agra, Allahabad, Moradabad, Saharanpur, Meerut, Aligarh, Muzaffarnagar, Bijnor and Azamgarh. Apart from these two States, Madhya Pradesh has got seven, Maharashtra five and Rajasthan four, while, Bihar, Jharkhand, Punjab, Odisha, Assam, and Arunchal Pradesh have got three each.

India’s use of Renewable Energy increases:

In a report published on 28, June in the Business Line, it was said that the country has 20,000 MW of wind capacity and the latest estimate of the potential is over ten times that Capacity. It also said India’s grid connected Solar Power plants add up to a capacity of 1,475 MW.

Consulate General of India, Widenmayer Strasse 15,80538 Munich, Germany. Web: www.cgimunich.com

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Foreign airlines may get to own domestic carriers:

It was reported that, with the Mayaram Panel’sRecommendations, Foreignairlines may get to control domestic airlines, both scheduled and non-scheduled ones, if the committee’s suggestions are accepted. The panel has recommended three caps, 49 per cent, 74 per cent and 100 per cent against the present 26, 49, 74 and 100 per cent. The Government-appointed panel has also recommended 100 per cent foreign direct investment (FDI) in existing airport projects without the need for any approval. Once these recommendations see the light of the day, airlines such as Jet, Indigo, SpiceJet and GoAir, and airports such as Delhi,

Mumbai, Hyderabad and Bangalore could be impacted.

The world will have more Indians than Chinese by 2028:

According to a report by United Nations, ‘World Population Prospects: The 2012 Revision’, India, which is currently the second-most populous nation in the world, is likely to become the largest in the world, in terms of population, by 2028, earlier than expected. The report estimates that even as China’s population growth starts slowing down after 2030 to reach 1.1 billion in 2100, India’s population will keepgrowing for decades to touch 1.5 billion by 2100. India’s young population is largely seen as an economically beneficial aspect.

***DISCLAIMER

This newsletter is a compilation of news articlesfrom various business e-newspapers and in no

way is an endorsement or reflection ofviews of Consulate General of India, Munich.

For queries contact:

Mr. VSDL Surendra, Consul (PIC), Consulate General of India, Widenmayer Strasse 15, 80538 Munich, Germany.

Email: cpic@cgimunich.com , Web: www.cgimunich.com