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NEWS FEATUREIndia, Russia sign 16 agreements across diverse sectorsIndia and Russia on Saturday signed 16 agreements across diverse sectors following delegation-level talksco-chaired by Prime Minister Narendra Modi and Russian President Vladimir Putin here.

Modi calls on business communities to work with BRICSPrime Minister Narendra Modi appealed to business leaders to work with BRICS governments to boost tradeand promote innovation.

More in this section

Russia keen to invest in India for making defence aircraftRussia is looking forward to collaborate with India in the manufacture of defence planes and spare partsfor aircraft.

OVERSEAS INVESTMENTS

Rosneft deal to open new oil routes for IndiaRosneft's takeover of Essar Oil has the potential to redraw India's oil routes, particularly for Russian-owned crude,to reduce dependence on supplies from Middle East and pitchfork the country into a regional products marketingwar with China in the next three years.


ITP Division Ministry of

External Affairs Government of India

Issue No 697 I October 11-17, 2016

p. 02/03

TRADE NEWSExports revive with 4.6 per cent growth in SeptemberReviving in September, India’s exports grew 4.62% year-onyear to $22.8 billion with 18 of the 30 exportingsectors showing growth.


p. 08/09

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p. 06/07

p. 10/12

SECTORAL NEWSIndia and Germany to collaborate on rail safetyIndia and Germany recently decided to collaborate on railway safety and agreed to form a joint workinggroup in this regard.


NEWS ROUND-UPModi calls for intra-BRICS trade target of $500 bn by 2020The 8th BRICS Summit concluded here on Sunday with Prime Minister Narendra Modi calling upon leaders of thegroup of emerging economies to double the size of intra-grouping trade to $500 billion by next five years.


WEEKLYECONOMIC BULLETIN

WEEKLYECONOMIC BULLETIN 2

Issue no 697 I October 11-17, 2016

>> NEWS FEATURE

India, Russia sign 16 agreements acrossdiverse sectorsIndia and Russia on Saturday signed 16 agreements across diverse sectors following delegation-level talks co-chaired byPrime Minister Narendra Modi and Russian President Vladimir Putin here.

"New horizons in the #IndiaRussia partnership. PM & Prez Putin witness exchange of 16 agreements and 3 announce-ments across fields," External Affairs Ministry spokespersonVikas Swarup tweeted following the 17th annual bilateralsummit between the two countries.

Among the agreements signed were inter-governmentalagreements (IGAs) for procurement of the S-400 air defencesystem and construction of 1135.6 series of frigates throughpartnership between Russian and Indian shipyards.

Another agreement was signed to set up a joint venture tomanufacture the Ka-226T helicopter in India.

A memorandum of understanding (MoU) was signed forsetting up an investment fund of $1 billion by the National In-vestment and Infrastructure Fund (NIIF) and the Russian Di-rect Investment Fund.

Agreements were also signed for developing smart citiesin Andhra Pradesh and Haryana, and for developing transportlogistics systems for such cities.

Another important agreement was signed betweenGazprom and Engineers India Limited (EIL) for the joint studyof a gas pipeline to India from Russia and other areas of cooperation.

According to a separate agreement, a Russian consortium comprising energy giant Rosneft Oil Company, commoditiestrader Trafigura and private investment group United Capital Partners agreed to purchase 98 percent of Essar Oil for $10.9billion.

Rosneft also signed an agreement with ONGC Videsh for education and training in the oil and gas sector.Both sides agreed to extend cooperation in railways development and to increase the speed of trains between Nagpur and

Secunderabad.An MoU was signed between India's ISRO and Russia's Roscosmos on mutual allocation of ground measurement gather-

ing stations for Russian space-based navigational system GLONASS and Indian regional navigational system NAVIC.An agreement was signed on cooperation on international information security.Another MoU was signed for expansion of bilateral trade and economic cooperation between India and Russia.An MoU was signed between India's Department of Science and Technology and Russia's Federal Agency for Scientific Or-

ganisations.A road map for celebrating 70 years of India-Russia diplomatic ties was also announced.Another announcement pertained to cooperation between the two countries on international issues.

Source: Indo-Asian News Service

WEEKLYECONOMIC BULLETIN >> NEWS FEATURE3


Modi calls on business communities towork with BRICSPrime Minister Narendra Modi appealed to business leaders to work with BRICS governments to boost trade and pro-mote innovation.

Addressing a meeting of the BRICS Business Council on Sunday at the 8th BRICS Summit in Goa, Modi also called onthe BRICS Business Council to enhance businessopportunities, building investment linkages and re-moving bottlenecks to intra-BRICS commerce, Xin-hua news agency reported.

"The promotion of economic and commercial en-gagement has been the foundational impulse in thecreation of BRICS. The business community is thestrongest proponent for closer and faster commer-cial cooperation that could help create wealth,"Modi said.

He also encouraged the council to work closelywith the New Development Bank, a multilateral de-velopment bank founded by the BRICS countries, onidentifying and implementing prospective economicprojects.

Speaking at the same occasion, South African President Jacob Zuma also commended the work of the council."The BRICS Business Council activities since undertaken through Durban Summit, have brought us to a point where

the council can be a true catalyst for economic growth," he said.Meanwhile, Russian President Vladimir Putin said: "Russia will continue to promote rapprochement of economies of

the five BRICS countries. It invites business communities of all the BRICS countries to work on Russia's market and de-velop partnership with the Russian companies.

The BRICS Business Council was established during the 5th BRICS Summit held in 2013 in Durban, South Africa.Source: Indo-Asian News Service

Russia is looking forward to collaborate with India in the manufacture of defence planes and spare parts for aircraft.Denis Manturov, Russian Minister for Industries and Trade, said this after visiting Multi-modal International Hub and Air-

port at Nagpur (MIHAN) yesterday.Manturov, who led a delegation of trade and industry repre-

sentatives from his country, met Maharashtra Chief Minister De-vendra Fadnavis.

The delegation visited MIHAN and saw the facilities and world-class infrastructure available at the project developed by Maha-rashtra Airport Development Company (MADC).

In a release issued last night, MADC quoted Manturov as say-ing Russia was "looking forward to invest in India in collaborationwith the Central Government, especially in manufacturing spareparts of aircraft and making defence planes".

He found Nagpur an ideal location for such units and said hisGovernment was keen to investment in them.

Manturov said he would encourage Russian companies to in-vest in MIHAN.

Source: Press Trust of India

WEEKLYECONOMIC BULLETIN >> OVERSEAS INVESTMENT4


Russia keen to invest in India for makingdefence aircraft

Rosneft's takeover of Essar Oil has the potential to redraw India's oil routes, particularly for Russian-owned crude, to re-duce dependence on supplies from Middle East and pitchfork the country into a regional products marketing war with Chinain the next three years.

Rosneft, the world's largest publicly traded oil company ,and two other investors on Saturday bought 98% of EssarOil's 20 million-tonne-per-annum refinery , associated portand fuel retail network for $13 billion. Rosneft will be in thedriver's seat with 49% stake.

The deal indicates Rosneft's thrust on expanding refiningcapacity outside Russia to ensure a captive market for itsrising portfolio of producing assets at home and abroad aswell as providing a hedge against fresh Western sanctionshitting its crude sales. The Essar refinery alone would add21% of Rosneft's total capacity in Russia, making India thefulcrum of its refining empire.

Rosneft has already said it intends to process crude fromits Venezuela asset in India. Venezuela now accounts for roughly 12% of India's oil supplies, with imports by Essar, RelianceIndustries and state-run refiners.

Venezuelan crude can be processed only by refineries with high level of sophistication, which somewhat limits its marketto mostly Asian region even though it is cheaper than global benchmarks.

Rosneft is expected to le verage the high level of sophistication of Indian refineries, especially those being modernised instate sector, to raise the flow of Venezuelan crude to India.

The company is also likely to go for swaps with South Korean, Japanese and European buyers that may see oil from newsources flowing to India. Such developments will only hasten the ongoing churning in India's oil shopping, which saw Iraqreplacing Saudi Arabia in June as the top supplier and South America raising its share.But it is doubtful whether Rosneft'sentry will result in a price war with Middle East suppliers since the latter have the advantage of lower transportation costs.

Source: Times News Network

Rosneft deal to open new oil routes for India

WEEKLYECONOMIC BULLETIN >> OVERSEAS INVESTMENT5


WEEKLYECONOMIC BULLETIN >> SECTORAL NEWS6


India and Germany recently decided to collaborate on railway safety and agreed to form a joint working group in this re-gard.

According to the Railway Ministry, the agree-ment on formation of a joint working group wastaken at a meeting between Union Railway Minis-ter Suresh Prabhu and German Minister for Trans-port and Digital Infrastructure Alexander Dobrindt.

"On the suggestion of Railway Minister, it wasdecided that a joint working group of Indian Rail-ways and German Railways will be formed to workon safety in rail operations," the ministry said in astatement.

"The working group would look into the training,technology and processes for improving the safety.This working group on safety would be a deliver-able on Inter-Government Consultations tentatively planned in Berlin in May, 2017."

Besides, India requested that Germany extends its proposal of high speed (300 km per hour plus) rail study of My-suru-Bengaluru-Chennai corridor to Vijayawada city of the Andhra Pradesh.

"It was pointed out that high speed rail connectivity through Mysuru-Bengaluru-Chennai-Vijayawada corridor will giveboost to the regional development and will link the states of Southern India," the ministry said.

The German side expressed willingness to undertake feasibility study on speed upgradation on the existing IndianRailway network.

The two sides held wide ranging discussions on areas speed raising, capacity increase of passenger and goods trans-port lines, safety, energy efficient rail operations, education and training, high speed rail, standards and norms and sta-tion development.


India and Germany to collaborate on railsafety

India's solar sector outlook is positive in view of a strong government support for the renewable energy sector to achievethe target of 40GW of installed rooftop solar power by 2022 along with high investor interest, says a report.

"We maintain our view that inefficiencies in the power grid infrastructure, power supply shortages and the scalabilityof decentralised technology pave the way for de-ployment in India," BMI Research said in a state-ment.

The outlook for solar power in India is positive,given the strong government support for the sec-tor, high investor interest in the market and thestrengthening project pipeline of projects, it said.

"26GW of solar capacity in the pipeline we ex-pect solar capacity to surge to nearly 53 GW by2025. This, however, is below government targets,which envisage solar capacity reaching 100GW by2022 -a target we believe too ambitious, due to thenumerous bottlenecks facing the country's renew-ables expansion, it said.

"We note that this growth in solar capacity isnot just confined to utility-scale capacity, as Indiaholds vast potential for the expansion of decentralised energy solutions (DES), notably in the form of off-grid and resi-dential solar," it said.

"Inefficiencies in the power grid infrastructure, power supply shortages and the scalability of decentralised technol-ogy pave the way for deployment in India - and in fact, the wider Asia region where we have highlighted the growing pen-etration of DES as a key theme," it added.

Within the government's solar roadmap there is a capacity target for rooftop solar-of 40GW by 2022. "We believe the fulfilment of this target will be determined by policy implementation at the state-level, given that

governance in the power sector remains very much state-led," it said. "As such, we view the announcement of Madhya Pradesh's decentralised renewable energy support scheme in Sep-

tember as a positive step towards increasing the deployment of rooftop solar in India at the national level. The scheme, which is called 'Smile on Every Roof', aims to install 2.2GW of rooftop solar by 2022 by introducing a

net-metering system, which enables consumers to sell excess power generated from household renewable energy sys-tems," it said.


India's solar sector outlook positive: Report

WEEKLYECONOMIC BULLETIN >> SECTORAL NEWS7


WEEKLYECONOMIC BULLETIN >> TRADE NEWS

Reviving in September, India’s exports grew 4.62% year-onyear to $22.8 billion with 18 of the 30 exporting sectors show-ing growth. This is the second instance of growththis year after June when exports had risen 1.27%after declining for 18 months in a row. With a2.5% fall in imports to $31.2 billion, the tradedeficit stood at $8.33 billion.

“Exports during September, 2016, have shownsign of revival,’’ commerce department said in arelease in Friday. Gold imports declined 10% to$1.8 billion last month. “The situation is improvingbecause demand has gone up in most countriesand government’s support measures are nowshowing results,” said Ajay Sahai, director generaland CEO, Federation of Indian Export Organisa-tions.

However, export of petroleum goods dipped1.43% to $2.55 billion in September while oil imports grew 3.13% to $6.88 billion. As for services trade, data released byRBI showed 4.7% growth in exports at $13 billion and an 8% rise in imports at $8,054 million in August.

“The revival in merchandise exports in September 2016 is encouraging. A persistence of this nascent trend wouldsupport the domestic consumption led recovery in economic activity in second half of FY 2017,’’ guided Aditi Nayar, vice-president & senior economist, ICRA.


8


Exports revive with 4.6 per cent growth in September

WEEKLYECONOMIC BULLETIN >> TRADE NEWS

The fall in exports has been arrested and its growth is expected to be slow but steady in the coming months, Commerceand Industry Minister Nirmala Sitharaman saidtoday.

"At the moment, the fall is arrested (and it) isvery clear. The growth is happening. We will onlybe looking at the steady growth. It may be slowbut steady" she told reporters here.

She said this in a reply to a question on outlookfor exports in the coming months.

Contracting for the second month in a row,India's exports dipped 0.3 per cent to USD 21.51billion owing to decline in shipments of productslike petroleum and leather.

Exports were in negative zone between De-cember 2014 and May 2016 due to weak globaldemand and slide in oil prices. Shipments wit-nessed growth only in June this year thereafter again entered into negative zone in July.

Meanwhile the minister also launched a dashboard on foreign trade data. "This has everything to do with exports and imports. What is the global position and which country is buying from

India, every data in exports and imports from ports to geographical areas are there," she said. This is part of the initiative of the ministry to provide easy access to the public with regard to India's export, import

and balance of trade data in an analytical format, over time and space. She said technology will be used for transparent decision making and reaching out to people using real time data. The detailed data would help user to inspect the trade that happens between India and a particular country, zoom into

the activities of a particular port and reflect trade pattern over any months of the user's choice. Through this, countries can be sorted by import value and the corresponding value of export trade. The commerce ministry in a statement said that digitisation of the government records and data analytics is crucial

for fast and effective evidence based planning and policy evaluation. The dashboard would provide an enabling environment to importers and exporters to identify and access global trade

opportunities based on reliable and updated information, directly accessible to the public through government sources.Source: Press Trust of India

Exports growth may be slow, but steady incoming months: Nirmala

9


WEEKLYECONOMIC BULLETIN >> NEWS ROUND UP10


Modi calls for intra-BRICS trade target of $500 bn by 2020The 8th BRICS Summit concluded here on Sunday with Prime Minister Narendra Modi calling upon leaders of the groupof emerging economies to double the size of intra-grouping trade to $500 billion by next five years.

"In 2015, intra-BRICS trade stood at about $250 billion. We should set ourselves a target to double this number to$500 billion by 2020," Modi said addressing theBRICS (Brazil, Russia, India, China, South Africa)leaders plenary here.

"This requires businesses and industry in allfive countries to scale up their engagement.

And, for governments to facilitate thisprocess to the fullest," he said.

"Our agreement on a tax and custom cooper-ation framework is a good start," he added, re-ferring to an outcome of the summit here.

Declaring that in a world of new securitychallenges and continuing economic uncertain-ties, BRICS stands "as a beacon of peace poten-tial and promise", the Indian Prime Minister saidthat the five-nation group's work holds muchmeaning for the developing world.

"In the past year, BRICS have played an activerole in shaping the global agenda for change and development. Our association with Agenda 2030, the Paris ClimateAgreement, and the Addis Ababa Action Agenda on Financing for Development has been purposeful and productive.

"And, we remain at the forefront of pushing change in the global governance architectures. BRICS should push forempowering the global governance institutions to reflect today's reality," he added.

At a meeting earlier in the day, Modi exhorted the BRICS Business Council to work with member countries forstrengthening mutual trade and said events like the first BRICS Trade Fair help to generate greater business awarenessand commercial exchanges.

"We count on the BRICS Business Council to work with us to achieve our common aim of strengthening mutual trade,enhancing business opportunities, building investments linkages, promoting innovation and removing bottlenecks tointra-BRICS commerce," Modi said at a meeting of the leaders with the BRICS Business Council.

"India hosted the first BRICS Trade Fair in New Delhi two days ago with active participation from all your countries.Such activities must be promoted to generate greater business awareness and commercial exchanges," he added.

The BRICS Business Council Report was also presented on the occasion.In the report, the council has recommended the member countries to continue dialogue for a new rating agency for

emerging economies.Besides, with a huge scope for intra-BRICS cooperation in infrastructure development and financing, the formation of

a group of angel investors was also one of its key recommendations.With the expansion of the BRICS agenda, the council also emphasised on the need to enhance business cooperation in

agriculture by way of sharing of best practices among members.

WEEKLYECONOMIC BULLETIN >> NEWS ROUND UP

Addressing the gathering, BRICS New Development Bank President K.V. Kamath said the lender is targeting an incre-mental revenue of $2.5 billion in the next year and that member countries would be approached to mobilise fundsthrough bond markets.

"Looking forward, we are targeting incremental revenue of $2.5 billion for the next year and we believe that this willbe largely in the area of sustainable infrastructure, green infrastructure... we plan to raise $1.5 billion through bonds," hesaid.

He also said that the NDB had begun the process of establishing its credentials as an institution which supports greenand sustainable infrastructure.

Kamath also said that the bank would seek to mobilise funds in the markets of the member countries, adding thatthere were plans to approach the bond market in India as part of the exercise.

Talking to media later on the sidelines, Kamath said that the Shanghai-headquartered NDB, which has completed oneyear of operations, had approved loans to the tune of $911 million for development of the renewable energy sector inmember countries.


11


WEEKLYECONOMIC BULLETIN >> NEWS ROUND UP12


Modi thanks Brazil for support to India'sNSG bidPrime Minister Narendra Modi on Monday thanked Brazilian President Michel Temer for his country's support for "under-standing India's aspiration" for membership of the Nuclear Suppliers' Group (NSG) as the two countries inked four MoUs,including on investment cooperation.

Modi, who met the Brazilian President on the side-lines of the BRICS summit here, also thanked Brazilfor support for India's actions against terrorism andfor early adoption of the key anti-terror initiative atthe UN - Comprehensive Convention on InternationalTerrorism (CCIT).

"We deeply appreciate Brazil's support for India'sactions in combating terrorism".

"India and Brazil have agreed that world mustcome together to fight this menace (terrorism) with-out distinction or discrimination," he said.

Modi, in his media statement, described Brazil asamong India's most important economic partners inLatin America.

"The bilateral relations between India and Brazilhave grown for the better. We have increased interac-tion at all levels," Modi.

"Brazil is among our most important economicpartners in Latin America. We have made progress inopening new areas of cooperation during this visit in drug regulation, agricultural research and cyber security," Modi said.

He said bilaterally and multilaterally, the partnership between India and Brazil is filled with possibilities that India iskeen to harvest.

The four MoUs inked are in the field of agriculture and animal husbandry, on pharma products regulation, on cattlegenomics and assisted reproductive technologies and on investment cooperation and facilitation treaty.


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WEEKLY ECONOMIC BULLETIN - India in Businessindiainbusiness.nic.in/newdesign/upload/Publications/Weekly/... · velop partnership with the Russian companies. ... The company is also