Spurt in global steel prices to boost export earnings of Indian firms

Kolkata: A 30% spurt in global steel prices since June 2017 led by a significant cutback in China's production capacity is likely to boost fortunes of domestic steel firms in the coming months. The perk up in international prices has helped raise domestic steel prices by 10% in last 2 months and is likely to boost export earnings of steel firms given the moderate increase in domestic steel demand, according to the latest sector report by ratings agency, ICRABSE -0.73 %.

Benchmark prices of Chinese hot rolled coil (HRC) export offers rallied by over 30% between June and August 2017, reaching US$ 555 per tonne on Tuesday (August 29, 2017). International steel prices have staged a sharp recovery since June 2017, driven by the Chinese government efforts to reduce domestic steel overcapacity. This has also led to a decline in Chinese steel exports on the back of resilient domestic steel demand in that country, ICRA said.

Earlier saddled with surplus capacity of over 300 million tonne (mt), the Chinese government has closed down 42 mt steel capacity between January-May 2017, on top of shutting down steel capacity of 65 mt in 2016. Incidentally, the last time Chinese HRC prices averaged above US$ 550 per tonne was in April 2013. “Continuity of this price momentum hinges upon sustainability of demand from steel intensive real-estate and infrastructure sectors in China”, Jayanta Roy, senior vice-president, ICRA said.

Domestic steel prices too have taken a cue from the buoyancy in international prices despite a moderate domestic steel demand growth of 4.4% in the first four months of the current fiscal. Between July and August FY18, domestic HRC prices have increased by around 10%, reaching Rs 39,250/tonne in the fourth week of August from Rs 35,750/tonne in the first week of July. Additionally, domestic steel mills have also continued to push exports, which grew 66% between April and July FY18. “A steadily rising export volume has enabled domestic steel mills to register a healthy annualised production growth of 7% and a capacity utilisation of around 81% during the period from April to July FY18,” the ICRA report added.

ICRA said operating margins of the steel industry (out of its sample of 22 large and mid-sized steel players, accounting for about 60% of current domestic capacity) contracted to 13.1% in Q1FY18 from 15.7% in Q4FY17 led by lower steel prices and higher coking coal costs in Q1 FY2018. “However, gross contribution levels of steel players are likely to improve sequentially in the current quarter, given that steel mills stand to benefit from buoyant steel prices in both the domestic and international markets in Q2FY18,” Roy added. ICRA, however, believes credit profile of domestic steel companies is unlikely to improve significantly in near term despite the current buoyancy in steel prices since on an absolute level elevated debt levels of most steel companies will keep the industry’s coverage indicators depressed.

Indian branded apparel market to touch Rs 30,000 crore in 3 years

MUMBAI: The branded apparel market estimated at Rs 20,000 crore is expected to touch Rs 30,000 crore mark in the next three years.

The size of Indian apparel garment market is Rs 2,45,000 crore, out of which the organised sector is Rs 45,000 to Rs 50,000 crore.

Garments / Textiles India Exports Imports

"Out of total apparel garment in organised sector, branded apparel market is estimated at Rs 20,000 crore and is expected to grow at 15 per cent per annum to touch Rs 30,000 crore in the next three years period," Don & Julio Apparels Worldwide managing director Ramesh Jain told reporters here.

The growth in branded apparel sector is in premium quality products & brands as a result of higher disposable income of young generation and their increased exposure to international brands & products like never before in India, Jain said.

Don & Julio Apparels Worldwide has launched premium shirts, trousers, suits and jackets for men in the Indian market. 

Moong and urad rates up after Import Ban

Nagpur: After the government banned imports of urad and moong, rates of the two pulses have gone up by Rs1000 and Rs350 a quintal respectively in the bulk market.
In lines of tur, which is the commonly consumed type of pulses throughout the country, a similar move was taken for moong and urad last week. Tur rates were increased by Rs150 a quintal, during the week.
According to analysis compiled by the Itwari Grain and Seeds Merchants Association, a ripple effect of the ban on imports was also seen in other types of pulses.
Following the import ban, prices of moong dal are at Rs80 a kg for the best quality. "The lowest grade is available at Rs56 in the wholesale market. A margin of Rs5 to Rs10 is added in the retail stores. Urad dal rates have now crossed Rs100 a kg in the wholesale market itself. The cheaper grades of urad dal are also in the range of Rs75 to Rs80 a kg," said Pratap Motwani of the Itwari Grain and Seeds Merchants Association.
Motwai said the rates of Chana too are moving up. The import ban has not been imposed on this commodity. "However, a major reduction in yield at Australia, which is one of the main centres of import, has increased the rates at home. Chana Dal, which is the processed form, is now at Rs90 a kg. Tur dal is priced at Rs65 a kg, in the wholesale market," he said.

imports of urad and moong

Traders Warn of stopping LPG Import as India Denies Permit to Nepali Bullets

Traders have warned that they will stop importing liquefied petroleum gas from upcoming November as India has not allowed bullets with Nepali number plates to supply the fuel.
The warning comes after no talk was held between the two countries as expected during Prime Minister Sher Bahadur Deuba’s recent visit to India.
Around one year ago, the Nepal government had written to India seeking permission for bullets with Nepali number plates to enter India. But, the southern neighbour has maintained silence over the issue.
“After our investment in the purchase of bullet got wasted, there is no point in importing gas from Indian transporters,” says Shiva Prasad Ghimire, President of Nepal LP Gas Industry Association.
India’s Petroleum and Explosive Safety Organisation has to issue such permits, certifying that the vehicles are safe enough to supply the petroleum product.
With a hope that India would issue the permit soon, Nepali traders had invested around Rs 5 billion to purchase nearly 775 vehicles. Two of them have already arrived in Nepal whereas 450 are ready to be brought here, according to Ghimire.
It has been learned that Indian transporters have put pressure on the Petroleum and Explosive Safety Organisation as issuance of permits to Nepali bullets would end their monopoly.
For last 40 years, around 500 Indian bullets are being used to ferry

Canada allows imports of Indian Pomegranates, Banana, Mangoes & Okra for first time : APEDA

India exported $0.69 million grapes, to Canada last year, after access was granted by that Country

NEW DELHI: Canada has allowed market access with certain conditions to Indian horticultural products like custard apples, pomegranates, okra, bananas, mangoes – this was relayed to the Indian industry by India’s Agricultural and Food Processed Food Products Export Development Authority (APEDA) confirming the Canadian Food Inspection Agency’s (CFIAs) approval.

The conditions for the shipments that CFIA has specified included – origin of the material be clarified in a detailed manner on the shipping documents and that the produce is free of soil, pests, and leaves.

APEDA’s letter detailed, “interested exporters of above-mentioned commodities are advised to contact the Canadian importers to start export from India subject to compliance of above mentioned requirements.”

The letter also clearly stated that exporters must keep in mind that packaging, labeling and other requirements pertaining to Canadian import requirements are met diligently.

It is not clear however whether access was granted to all the horticultural products mentioned above at once or separately in parts.

India exported $0.69 million grapes, to Canada last year, after access was granted by that Country. This was a growth of 32.59% compared to -36.83% growth seen in 2014-15.

There is the news that a sizeable quantity of pomegranates is likely to be shipped commanding good prices.

This positive development comes after the resumption of talks on free trade between the two countries after two years. Canadian and Indian officials are under discussions.

India Natural Rubber imports may increase

Natural Rubber imports to India are expected to increase on the back of declining prices of Natural Rubber in the global market.Natural Rubber imports during the period of April and July this year declined by about 14 percent to 130543 tons when compared to the corresponding period last year.
The decline in imports was on the back of the increase in global prices and higher production in India. Natural Rubber production in India during the period was seen to increase by about 7.5 percent to 201000 tons.

Natural Rubber  Imports to India

Continuous rain has affected tapping, resulting in a supply crunch in the local market in the last few days. While local prices are hovering around Rs 130 per kg, crumb Rubber prices have dropped below Rs 100 per kg in the international market, which is anticipated to help imports.
Resources:   commodityonline.com

Indian finished steel exports up 64%; imports rise 42% in July

India’s export of finished steel surged by 64.2% to 0.770 million tonne in the month of July against the 0.469 million tonne in the same month a year ago, according to a report.

On the other hand, finished steel imports also jumped by 42.2% at 0.798 million tonne in the said month this year against the 0.561 million tonne last year, said the report by Joint Plant Committee (JPC), which gathers data on iron and steel sector in India.

“India was a net importer of total finished steel in July 2017 but maintained its net exporter status for the cumulative period, i.e. during April-July 2017,” it said.

During April-July period this year, exports of total finished steel were increased by 65.5% to 2.807 million tonne as compared to 1.696 million tonne in the same period last year, the report said.

The imports of total finished steel was 2.505 million tonne in April-July period, an increase of 4.7%, as compared to 2.393 million tonne during the same period a year-ago, it added.

The total finished steel consumption increased by 3.7% to 6.905 million tonne in July this year from 6.660 million tonne in July 2016.

However, the overall consumption finished steel was declined by 4.2% in July from 7.210 million tonne in June 2017, said the report.

During April-July period this year, total finished steel consumption in the country surged by 4.4% to 27.911 million tonne as compared to 26.736 million tonne in the corresponding period last year, on account of rising output for sale and imports, it said.

India is third largest country in the production of crude steel followed by China and Japan.

steel exports from India

Basmati rice overtakes buffalo meat to become India's top export

The basmati rice exports increased from Rs 6,196 crore of last year’s April-June quarter to Rs 8168 crore in the same quarter this year.

Basmati rice has regained its position as the top commodity export from India. The famed rice variety replaced buffalo meat to become the top most export for the April-June quarter.

Basmati rice had been countries key export commodity for years. But since 2014-15 financial year, buffalo meat had surpassed the former, thus becoming the top export commodity.

A report in the Business Standard says, this happened after Iran, which consumes over a quarter of India's Basmati exports to the world had suspended all new orders earlier.

Iran usually suspends import orders during its harvesting season. As per reports, this year the traders in Iran have continued importing Basmati even during the harvesting season.

As per the Agricultural & Processed Food Products Export Development Authority (Apeda) estimates, the Basmati exports increased from Rs 6,196 crore from last year's April-June quarter to Rs 8168 crore in the same quarter this year.

Another factor behind Basmati grabbing the top spot in exports is the decline in the export of buffalo meat. Despite the decline in buffalo meat exports, the revenue earned from its exports increased nominally from last year’s Rs 5445 crore to Rs 5473 crore in present year’s April-June quarter.

While the short lived ban on the sale of cattle in mandis hit the buffalo trade adversely the recent government actions in the export market has had a contrary effect on basmati trade.

basmati rice exports from India

India's refined palm oil imports to fall as duty change makes crude palm cheaper

MUMBAI/KUALA LUMPUR: India's refined palm oil imports are likely to plunge in the next marketing year, industry officials said, as changes in trade tariffs make imports of crude palm oil cheaper, a boon for refiners previously hit by cheaper imports of rivals' goods.

Indonesian and Malaysian refiners, which ramped up capacity to cater to India's demand, are likely to come under pressure due to the decision by India, the world's biggest palm oil importer, to widen the import duty gap between refined, bleached and deodorized (RBD) palm olein and crude palm oil (CPO) .
In a move designed to protect domestic farmers, India last week doubled import duty on CPO to 15 percent, and raised the levy on RBD palm olein by 10 percent to 25 percent. The move widened the gap in duties between refined and crude palm oil to 10 percent from 7.5 percent previously.
"We expect a significant shift from imports of RBD palm olein to CPO due to the hike in duty differential," said Dinesh Shahra, managing director of Ruchi Soya IndustriesBSE -0.22 %, a leading Indian refiner. "Share of CPO in total palm imports is expected to rise to over 90 percent from 69 percent last year."
If the change is good news for Indian refiners, reactions among exporters suggest concern.
"It's not going to be easy now, there will be an impact where refiners will be getting a lot of the blow," said an upstream manager with a Malaysian plantations company, speaking on condition of anonymity.
India's imports are traditionally dominated by crude oils which are then refined for the domestic market. But moves by Indonesia and Malaysia to put higher taxes on exports of crude palm oil than refined products - an effort to promote domestic refining industries - made imports of refined products cheaper for India.
The changes allowed refined palm oil to corner 31 percent of India's total palm oil imports in 2015/16 year ended in October, up from 17.4 percent a year ago in 2016/17 and just 3.6 percent in 2006/07.
"We believe that (palm) prices are likely to be more biased towards the downside once...the increase in import duties in an important market like India work its way through," said Sunny Verghese, chief executive of Olam International Ltd..
Since the duty change, some Indian importers have already begun requesting sellers to replace refined palm shipments with CPO, said Sandeep Bajoria, chief executive of the Sunvin group, a Mumbai-based vegetable oil importer.
In the first nine months of the current marketing year started on Nov. 1, India has imported 6.74 million tonnes of palm oil, including 2.2 million tonnes of refined palm oil.
Palm oil's share in India's total edible oil imports has been falling consistently due to competition from rival soyoil and sunflower oil. In 2015/16 palm's share fell to 58 percent from 80 percent in 2012/13.
After the recent duty changes, crude soy oil now attracts 17.5 percent duty, lower than 25 percent for CPO, which could encourage imports of soyoil, dealers said.
"Regular demand will always be there but because soyoil duty is less, buyers may switch to soy," said one Kuala Lumpur trader, who declined to be named.

India’s trade deficit narrows to $11.45 billion in July from a month ago

India’s trade deficit narrowed to $11.45 billion in July from a month ago, following a slowdown in imports even as exports expanded 3.94% year-on-year

New Delhi: India’s merchandise export growth, at 3.94%, decelerated to its lowest level in eight months as readymade garments, pharmaceuticals and gems and jewellery exports contracted.

However, imports continued to grow in double digits for a six consecutive month, though at a slower pace of 15.4%, thus leaving a trade deficit of $11.4 billion.

Exporters’ bodies demanded that their concerns regarding a liquidity crunch under the Goods and Services Tax (GST) regime and reducing the cost of credit to the sector be addressed.

Why India must take China’s warning of a trade war seriously

NEW DELHI: India has not taken Chinese bullying over Doklam seriously. For the last several weeks, China has been warning of helping insurgents in India, invading border areas in Uttaranchal and Kashmir, and a war breaking out soon. It is clear China cannot afford a war over Doklam. That’s why India has not responded to China’s belligerence in equal measure.

However, there is one war which can break out and India cannot afford it—a trade war with China. Recently, India imposed anti-dumping duties on 93 Chinese products. China is not going to tolerate this measure and is likely to respond. State-owned Chinese media has urged Chinese firms to reconsider the risks of investing in India and warned New Delhi to be prepared for the “possible consequences for its ill-considered action”.

An article in state-owned Global Times said that China could easily retaliate with restrictions on Indian products, but added that it “doesn't make much economic sense” for the country. But it warned that a trade war between China and India seemed to be looming after the imposition of anti-dumping duties on Chinese products.

Why India cannot afford to fight a trade war with China at this juncture? Consider the following:

India's trade deficit with China rose to $46.56 billion last year. China's exports to India totaled $58.33 billion, registering a meager increase of 0.2% compared to $58.25 billion in 2015. India's exports to China dropped 12% from 2015 to $11.76 billion.
India exports less to China (mainly raw materials) and imports more (mainly electronics and other manufactured goods which are in high demand). India's pharma sector has critical dependence on Chinese imports used in drugs manufacturing.
China's exports to India account for only 2 per cent of its total exports. So even if Indians boycott all the goods imported form China, it will not make as big an impact on China as to bring it to its knees before India.

Of course, China needs new markets for its manufactured goods, and India is one of those new markets where its electronic goods, especially smartphones, have found a large market. But China can find markets in other Asian countries and even in Africa. It is also trying to create a market for its goods in Europe. It is in no way dependent on India.

China is India’s largest trading partner, but the trade is heavily skewed in favour of China. A trade war when Indian manufacturing ability is limited is not going to favour India. India’s imports from China are crucial at this stage.India today imports telecom gear worth over Rs 70,000 crore annually, much of it from Chinese firms like Huawei and ZTE. Chinese companies dominate the telecom sector in India. In handsets, they control 51% of India’s $8 billion plus smartphone market with brands like Xiaomi, Oppo, Vivo and OnePlus.

Power is another sector where India has come to be dependent on Chinese imports. In the 12th Plan alone, almost 30% of the generating capacity was imported from China. In the rapidly growing solar energy sector, between April 2016 and January 2017, solar equipment from China had a share of 87% in a market pegged at $1.9 billion. According to consultancy firm Grant Thornton, in 2017, when inbound deals dipped, the Chinese shifted gears and accounted for 31% of the inbound deal value as against27% from the US.

The popular impression is that China is dumping consumer goods into India. But the fact is that India depends on China for capital goods too. Reduction in import of cheaper capital goods will push up production costs.

India can fight trade wars with China only when it has removed the big skew in its trade with China, which can take a decade of manufacturing growth.

India-made garments have the largest pie in US imports in H1

Chennai: For the first time in the history of India’s garment exports to the US, the country has clocked top position in market share in the category ‘men/boys knitwear shirts cotton’ (a variety of knitwear) for the first six months of 2017.
This was attributed to the slowdown in China. Exporters, however, said they will not be able to retain top position. Exporters say that since the US market offers a level playing field, they were able to compete with other countries, but the recent appreciation of the rupee against the dollar will be a major hurdle to them.
The data released by the Office of Textile and Apparel, US department of commerce, show that India exported 8.5 million dozens of men/boys shirts cotton to the US. India’s share in men/boys knitwear shirts import by the US stood at 8.7 per cent in June.
After a dip in 2014, India’s market share has been growing steadily. In 2013, India’s market share was 6.4 per cent and dropped to 6.2 per cent in 2014. From then it has been steadily increasing, and in 2016 it stood at 7.8 per cent.
Contrary to that, China’s market share, which was 11 per cent in 2012, dropped to 9.6 per cent in 2016 and is now 8.5 per cent. In other segments including women/girls knit shi-rts/blouses, cotton, men/boys cotton trousers, breeches, shorts, and cotton nightwear/pajamas, India and others’ market shares have increased.
While China’s loss is India’s gain, exporters are not happy because Vietnam is running India close. Bangladesh is also increasing its market share. The data show Vietnam exported 8.47 million dozens of men/boys knitwear to the US. Tirupur Exporters Association President Raja M Shanmugam said heavy investment increased India’s share in export. “The US is the only country that gives us a level playing field, and that is why we could compete,” said Shanmugam, adding that the country was losing the edge now because production cost was increasing here.
An exporter said: “We will not be able to compete with Vietnam or with any countries because products made here are becoming costlier.”
For example, exporters are quoting 3-5 per cent higher prices after the rupee appreciated, while the hike should be of around 7 per cent to compensate them for the losses on account of currency fluctuation. On the other hand, competitors' currencies have depreciated and they are bringing down the prices.

India-made garments  Exports Imports

Government bans export of gold items above 22-carat purity

NEW DELHI: The government has banned exports of gold jewellery, medallions and other articles above 22- carat purity in a bid to check round tripping of the precious metal.

In a notification, the Directorate General of Foreign Trade (DGFT) has said certain provisions of the foreign trade policy (2015-20) are "amended to allow export of gold jewellery (plain or studded) and articles containing gold of 8 carats and above up to a maximum limit of 22 carats only from domestic tariff area and export-oriented units, electronics hardware technology parks, software technology parks and bio technology parks".

This means that export of gold jewellery, medallions and other articles of the precious metal above 22 carat purity is not permitted by any exporter, including from these parks, which are meant for sector-specific shipments.

The DGFT also stated that only those exporters can avail of incentives who are shipping gold jewellery and other articles containing gold of 8 carats and up to a maximum limit of 22 carats and not beyond.

According to an official of the Gems and Jewellery Export Promotion Council (GJEPC), some exporters were availing of export incentives by claiming export of gold items of above 22 carat purity with some value addition.

"This is not possible as India is a net importer of gold and no trader would import above 22 carats gold and export it as it is without value addition. This is not a financially viable business," the GJEPC official, who did not wish to be named, said.

Sharing similar views, an official of the Federation of Indian Export Organisations (FIEO) said that through this notification, the government has banned export of the jewellery above 22 carats and this decision will not impact shipment of gold jewellery as there is significantly less demand for these items in the international market.

The decision came at a time when Indian gold jewellery traders have raised concerns over a surge in gold imports from South Korea.

Gold import from South Korea jumped to USD 338.6 million during July 1 and August 3 this year. The import in 2016-17 stood at 470.46 million.

Under the free trade pact between India and South Korea, basic Customs duty on gold was eliminated.

Further, the 12.5 per cent countervailing duty on gold imports has been subsumed in the Goods and Services Tax (GST). Accordingly, imports now attract only 3 per cent integrated GST.

Countries impose this duty to discourage import of a product.

India is the world's second-biggest gold consumer after China. The imports mainly take care of demand by the jewellery industry.

Gold Exports Imports India

Agriculture exports down from $43.23 billion to $33.87 billion in India

India's agricultural exports have declined to $33.87 billion in 2016-17 from $43.23 billion in 2013-14.

The primary reasons for decline in export of agricultural commodities are low commodity prices in the international market, "which has made our exports uncompetitive," Commerce and Industry Minister Nirmala Sitharaman said.

Import of agricultural commodities including plantation and marine products in 2016-17 rose to $25.09 billion from $15.03 billion in 2013-14.

She added that export and import of agricultural products depend on various factors such as availability, international and domestic demand and supply situation and quality concerns.

"Edible oils and pulses, which are in short supply in India, account for the bulk of India's import of agricultural products," the minister said.

Sitharaman said the share of agricultural exports in total exports of the country has declined marginally during the past three years. ■

India Agriculture Product exports

India raises Vegetable Oil import taxes

India, the world’s biggest buyer of Vegetable Oils, has raised import taxes on crude and refined edible oils to protect local oilseed farmers from cheaper imports from top suppliers Malaysia and Indonesia.
The government doubled the import tax on Crude Palm Oils to 15% and raised the import tax on refined Palm Oils to 25%, increasing the differential in duty by 10 percentage points to encourage local processing.

The government also raised the import tax on crude Soybean Oil to 17.5% from 12.5% previously.
The country spends about $10 billion a year to import Palm Oil from Malaysia and Indonesia and relatively smaller quantities of Soybean Oil from Brazil and Argentina.

India to import 25 T gold from South Korea, avoiding duty - industry officials

Indian traders are likely to import 25 tonnes of gold from South Korea in July and August, taking advantage of a recent tax change that allows importers to ship in gold without paying a 10 percent customs duty, industry officials told Reuters.

The cheap imports are putting pressure on local refiners and banks who cannot match the steep discounts being offered on bullion sales from the duty-free gold from South Korea.

"Already 12 tonnes have been landed from South Korea since the implementation of GST. By the end of this month imports could be around 25 tonnes," James Jose, secretary of the Association of Gold Refineries and Mints told Reuters.

India, the world's second biggest gold consumer after China, imposes a 10 percent import duty on gold, but this does not apply to countries with which it has signed Free Trade Agreements (FTAs), like South Korea.
To avoid duty free imports from those countries, India previously imposed a 12.5 percent excise duty. However, this was scrapped along with other local taxes when a Goods and Services Tax (GST) was introduced from July 1.
"Those who are importing from South Korea are reaping windfall gains," said Rajesh Khosla, managing director of MMTC-PAMP India, the country's biggest refinery.

"They are saving the 10 percent import duty. So they can give a $10 or $15 discount. Refiners are operating with a 0.65 percent margin. We cannot compete with someone who is giving a 1 percent discount," Khosla said on the sidelines of the International Gold Convention in Panaji, capital of India's western resort state of Goa.

South Korea is favoured for importing gold over other countries that India has FTAs with because of its ability to deliver bullion in the form of coins or other articles, which do not attract the import duty.

Gold discounts in India widened earlier this month to $11 an ounce, the highest in more than 10 months.

"The government is aware of the issue and we have asked industry associations to provide more data," said a government official, who declined to be named.

The government has asked traders who are importing gold under free trade agreements to fill in a questionnaire that asks them to specify whether the goods are manufactured in those countries, the official said.

"Very soon this issue will be resolved by putting on a countervailing duty," he said.
In the first seven months of the 2017, gold imports more than doubled from a year ago to 550 tonnes, according to provisional data from consultancy GFMS.

Amid Doklam standoff, Chinese imports to India up by 33% in April-June quarter

The rise in imports is on the back of a stronger rupee that has appreciated about 5.5% against the US dollar and 3.7% against the Chinese yuan since February.


Chinese imports to India recorded a 33% jump in the April-June quarter over the same period last year, government data shows, indicating trade remains unscathed by the border standoff between the two countries.
The rise in imports is on the back of a stronger rupee that has appreciated about 5.5% against the US dollar and 3.7% against the Chinese yuan since February. Electronics and engineering goods and chemicals were the biggest imports.
“The political tension that we are witnessing now is unlikely to have any impact on the trade relations between the two countries…it is business as usual for both countries at present and the situation will not change,” DK Joshi, chief economist, Crisil, told Hindustan Times.
The Asian giants are locked in a row in the remote Doklam plateau, which borders Sikkim in India’s northeast and is claimed by both Beijing and Bhutan, since June 16.
Chinese blame India for the two-month long standoff, the longest between the neighbours. It accuses India of trespass and preventing its soldiers form building a road, which New Delhi says is a threat to its security.
China is also India’s largest business partner, with trade heavily tilted in its favour.
During the April-June period, India imported goods worth $18 billion compared to $13.5 billion last the previous year. The appreciation of the rupee allowed Indian importers to purchase larger quantities of goods at lower prices, a report by the State Bank of India said, adding it could have a bearing on the domestic industry. A yuan is trading at Rs 9.6.
“The political and economic compulsions are divorced from each other but rights steps need to be taken to encourage domestic industry so that it could generate income and jobs and reduce India’s dependence on imports, giving boost to ‘Make in India’, SBI chief economic adviser Soumya Kanti Ghosh SBI said on Sunday.
The report said the appreciation of rupee against Chinese renminbi enabled Indian importers to purchase larger quantity of goods at lower prices. “We estimate, India on a conservative basis, saved at least $3.9 billion in May 2017 because of the stronger Indian rupee,” it said.
Federation of Indian Exports Organisation director general Ajay Sahai was upbeat on business ties. Trade would not be affected by the “current level of political tension”, he said.
But the widening trade deficit -- the difference between imports and exports—continues to be a worry. Trade deficit in 2016-17 stood at $51.1 billion compared to $19.26 billion in 2009-10. It means India’s is buying way more than what it sells to China.
For some policy experts though it could be India’s leverage. With its economic growth slowing, China would want its foreign markets to widen. The economy is also the reason China is looking to flex its muscles abroad to bolster confidence at home.

Indonesia's exports, imports seen surging y/y in July

* reuters://realtime/verb=Open/url=cpurl://apps.cp./Apps/econ-polls?RIC=IDTRD%3DECI poll data
* July exports seen +31.12 pct y/y, vs -11.82 pct in June
* July imports seen +30.34 pct y/y, vs -17.21 pct in June
* Trade balance seen at a $1.10 bln surplus, vs June's $1.63 bln
* Trade data due on Tuesday, Aug 15, at 0400 GMT
JAKARTA, Aug 11 (Reuters) - Indonesia's exports and imports likely surged in July from the same month a year ago as trade figures were affected by seasonal factors, a Reuters poll showed.

Officials said the contraction in exports and imports in June was due to the long Eid al-Fitr holidays. Last year the holidays were in July. The values of July 2016's exports and imports were the lowest in years, affecting the growth base for July 2017 figures.
The median forecast of 10 analysts in the poll was for a yearly increase of 31.12 percent in exports and 30.34 percent in imports in July this year.
Shipments from Indonesia fell 11.82 percent on an annual basis in the previous month, while imports were down 17.21 percent, both representing the first contraction in nine months.

Analysts in the poll expect Indonesia's trade surplus to shrink to $1.10 billion in July from June's $1.63 billion. 

Rupee appreciation may take imports from China to over $61 billion

New Delhi: The rupee has appreciated significantly against the dollar and the Chinese Renminbi since February and if the trend continues, imports from China may cross USD 61.30 billion, a level attained during last fiscal, says a report.
The domestic currency has firmed up by close to 5.5 percent against the dollar since February on the back of a significant portfolio capital inflows of about USD 27.5 billion.
Moreover, the Indian currency has appreciated by 3.7 percent against the Chinese Renminbi since February, resulting in surge in cheaper imports from China.
According to SBI's research report Ecowrap, appreciation of the rupee against the Renminbi has enabled Indian importers to purchase larger quantity of goods at lower prices and if the firming trend continues, it will make goods from China even cheaper.
"If this trend of rupee appreciation continues, thereby making goods from China cheaper, our imports from China could very well exceed the level of USD 61.30 billion attained in 2016-17," the report noted adding that it can adversely impact the production of domestic industries.
The report further said with trade deficit with China constituting 48 percent of the overall trade deficit in 2016 -17, this is indeed a matter of serious concern for policy makers.
India runs a trade deficit with China which has increased significantly over the years. Trade deficit has risen to USD 51.1 billion in 2016-17 compared to USD 19.26 billion in 2009 -10.
Exports to China are more or less at the same level while imports have doubled during the same period.
"This calls for some policies which support and encourage domestic industries so that they can grow, generate income and employment and reduce dependence on such frivolous imports thereby making the dream of 'Make in India' successful," the report noted.
India majorly imports electronic goods, engineering goods and chemicals from China.
"While rupee appreciation does have positive consequences in terms of lower imported inflation, in times of lower oil prices, we could perhaps live with a little bit of rupee depreciation !," the report said.

India to unveil new biofuel policy to cut oil, gas, coal imports

India’s top three state-owned oil companies have pledged a combined $2 billion to carry out research to develop biofuel technologies and the government has pledged to guarantee a return on their investments.
India will soon announce a new policy to promote biofuels as part of efforts by the world’s third-largest emitter of greenhouse gases to cut imports of fossil fuels like oil, gas and coal, a government minister said on Thursday.
The government aims to develop a biofuel economy worth 1 trillion rupees ($15.6 billion) in the next two years, oil minister Dharmendra Pradhan told a conference on renewable energy on Thursday.
India’s top three state-owned oil companies have pledged a combined $2 billion to carry out research to develop biofuel technologies and the government has pledged to guarantee a return on their investments, Pradhan said.
“The roadmap to lower crude oil imports is connected to biofuel,” Pradhan said. India, the world’s third-biggest oil consumer, aims to cut its crude imports by 10% by 2022.
New Delhi also plans to lower its carbon footprint by raising the use of natural gas in its energy mix to 15% in the next three to four years, up from 6.5% currently.

The government has already asked state oil companies to set up ethanol plants at 12 locations over the coming year.
Energy consumption in India is expected to grow as the government aims for economic growth of 8-9 percent this fiscal year through March 2018, against around 7% in 2016/17.
Indian Oil Corp, the country’s top refiner, plans to enhance the capacity of its biofuel refineries to 100 tonnes a day from about 12 tonnes a day in the next two years, chairman Sanjiv Singh told reporters at the conference.
IOC runs three biofuel plants with an investment of about 30 billion rupees and is looking to increase the number of such plants, Singh said.
India needs private investment in the sector and once the cost of production comes down, the country could see some private sector participation, Singh said.
Separately, transport minister Nitin Gadkari said Prime Minister Narendra Modi’s cabinet could soon consider allowing the use of alternative fuel methanol in shipping.

Gold imports more than doubled in July ahead of GST implementation

Gold imports by India are said to have risen in July on arrival of some delayed shipments booked ahead of the implementation of a new national goods and

services tax on the first of last month, according to a person familiar with the information.

Inbound purchases rose to 53.4 metric tons last month from 22 tons a year earlier, said the person, who didn’t wish to be identified because the data isn’t

public. Sequentially, imports of the metal fell from 72 tons in June. Total imports during January to July jumped more than 2 1/2 times to 625.5 tons,

according to data compiled by Bloomberg. Finance Ministry spokesman DS Malik declined to comment on the data.

While traders and dealers stocked up on gold inventories ahead of the levy of the national goods and services tax on fears of a higher duty, demand is

expected to slow in the second half of 2017 as buyers take time to transition to the new regime, the World Gold Council said last week. Consumption is

estimated to remain below a five-average of 850 tons and be in the range of 650 tons to 750 tons this year, it said.

“Such an increase in imports is not sustainable because the demand from the consumer side in the market is very slow and interest from the investment side

has also dried up on low returns,” said Bachhraj Bamalwa, a director with the All India Gems & Jewellery Trade Federation, referring to the July jump.

Shipments from South Korea climbed in the month as importers took advantage of the lower goods and services tax rate and a free-trade agreement between the

two nations, the person said. Imports from most other countries are taxed at 10 per cent versus zero for those from South Korea.

While this is the first time there has been a surge in imports from South Korea, importers have previously made use of free-trade treaties with countries

such as Thailand and Indonesia in order to escape paying the import duty, said Bamalwa. This makes a strong case for the import tax to be lowered across the board, he said

Glod imports

Export of soybean meal increases by 235%

Export of soybean meal and its other value added products during July 2017 has been pegged at 0.98 lakh tons compared to 0.29 lakh tons in July 2016 showing an increase of 235 per cent over the same period of last year, according to a release issued by Soybean Processors Association of India (SOPA) on Tuesday.

On a financial year basis, the export during April’2017 to July’2017 is 4.69 lakh tons as compared to 1.19 lakh tons in the same period of previous year showing an increase of 292 per cent.

The release added that during current oil year, (October 2016 – September 2017), total exports during October 2016 to July 2017 is 16.46 lakh tons as against

3.48 lakh tons during the same period last year, showing an increase of 372.72 per cent.

Export of soybean meal

Gems & jewellery Q1 exports rise 4%

NEW DELHI: Gems and jewellery exports grew by about 4 per cent to USD 9.17 billion during the first quarter of the current fiscal, driven largely by demand in major markets like the US.

In the April-June quarter of last financial year, the sector's exports aggregated to USD 8.84 billion, according to the data from Gems and Jewellery Export Promotion Council (GJEPC).

The labour intensive sector contributes about 14 per cent to the country's overall exports.

The rise in shipments was mainly supported by exports of silver jewellery, and gold medallions and coins.

Silver jewellery exports increased to USD 1.71 billion during April-June 2017-18, from USD 958.65 million a year ago.

Similarly, shipments of gold medallions and coins registered a growth of about 42 per cent to USD 1.51 billion during the period under review.

Gold jewellery shipments recorded a meagre growth of 1.78 per cent during the first three months of the current financial year.

Exports of cut and polished diamonds, coloured gem stones and rough diamonds also reported positive growth.

India's main export destinations include Europe, Japan, China and the US. 

According to the GJEPC data, imports of rough diamonds rose by 17 per cent to USD 5.4 billion in April-June 2017.

Imports of gold bars, however, dipped by about 57.43 per cent to USD 569.12 million.

Gems and jewellery exports

India plans to allow extra 2 lakh tonnes duty-free sugar imports

India is planning to allow additional 200,000 tonnes of duty-free sugar imports, a government source said on Tuesday, as production fell below consumption in 2016/17 marketing year ending on Sept 30.
New Delhi: India is planning to allow additional 200,000 tonnes of duty-free sugar imports, a government source said on Tuesday, as production fell below consumption in 2016/17 marketing year ending on Sept 30.
The world`s biggest sugar consumer had earlier allowed duty-free imports of 500,000 tonnes of the sweetener.

The country`s opening sugar stock for 2017/18 season starting from October 1 are likely to be 4 million tonnes, down sharply from 7.7 million tonnes this year, the source, who declined to be named, said.

Separately, India is planning to raise import tax on vegetable oils like palm oil, soyoil and sunflower oil, the source added.

Oilmeal exports jump 54% during April-July

AHMEDABAD, AUG 8:
Triggered by a sharp surge in soyameal exports, India's overall oilmeal exports reported an increase of 54 per cent at 638,468 tonnes during April-July 2017 against 413,341 tonnes reported in the same period last year.

According to data compiled by the Soyabean Processors Association of India (SOPA), the country's soyabean meal exports stood at 4.69 lakh tonnes compared with 1.19 lakh tonnes in the same period previous year, showing a surge of 292 per cent on year-on-year basis.

According to the Solvent Extractors' Association of India (SEA), "In the last three months, export of oilmeals improved compared to the previous year, thanks to good monsoon, better oilseeds production and price parity. In percentage terms, exports showed improvement, but still they were lower compared to earlier years."

It may be also noted that India faced drought years during 2014-15 and 2015-16. During this period, production of oilseeds was hit and the exports of oilmeals were dropped to the lowest level. However with good monsoon last year, exports revived to some extent, SEA added.

SOPA, however maintained that during the current oil year (October-September 2016-17), total soyameal exports during October 2016 to July 2017 stood at 16.46 lakh tonnes against 3.48 lakh tonnes during the same period last year, showing an increase of 372.72 per cent.

soya meal exports India

Agriculture exports decline to $33.87 billion in FY17

NEW DELHI: India's agricultural exports have declined to $33.87 billion in 2016-17 from $43.23 billion in 2013-14, Parliament was informed today.

The primary reasons for decline in export of agricultural commodities are low commodity prices in the international market, "which has made our exports uncompetitive," Commerce and Industry Minister Nirmala Sitharaman said in a written reply to the Rajya Sabha.

However, import of agricultural commodities (including plantation and marine products) in 2016-17 rose to $25.09 billion from $15.03 billion in 2013-14.

She added that export and import of agricultural products depend on various factors such as availability, international and domestic demand and supply situation and quality concerns.

"Edible oils and pulses, which are in short supply in India, account for the bulk of India's import of agricultural products," the minister said.

In a separate reply, Sitharaman said the share of agricultural exports in total exports of the country has declined marginally during the past three years.

India's agricultural exports

India’s gems, jewellery export to touch $60 billion in 5 years: GJEPC

SURAT: India's gems and jewellery export is likely to touch the $60 billion mark from the current $43 billion in next five years. India's jewellery trade led by the Gems and Jewellery Export Promotion Council (GJEPC) has prepared a document titled 'Vision-2022' to be presented to Prime Minister Narendra Modi for a plan to increase exports by about 40% over the next five years.

India’s gems, jewellery export

One of those measures is to improve the industry's infrastructure by creating jewellery parks across the country. The jewellery parks would serve as "one-stop" locations for the entire production process. The first is planned for Mumbai. Other aspects of the programme include modernizing smaller jewellery manufacturers' equipment, enhancing the industry's design capabilities by collaborating with international designers and improving its merchandising.

GJEPC chairman Praveen Shanker Pandya said, "The vision document 2022 has predicted growth of the gems and jewellery exports by over 40%. However, there are concerns that the country's new goods and services tax (GST) would limit

Pandya added, "The council was in an ongoing dialogue with the government to smooth out procedural issues arising from the new policy. Among those is the matter of charges for transporting diamonds between the states — for example, from Surat in Gujarat — where most of the diamond manufacturing takes place — to Mumbai in Maharashtra. That issue will be resolved in the next two months."

Since GST took effect on July 1, trading has returned to normal, as it did post-demonetization in November last year. "People thought these policies will diminish the industry, but it didn't," Pandya said. "Rather, we feel these decisions are enabling a level of transparency that we couldn't achieve before."

Pandya noted that electronic payments had increased as a result of demonetization and that cash transactions were being limited. Diamond dealers at IIJS agreed, pointing to a notable shift away from cash.
GJEPC's regional chairman of Gujarat, Dinesh Navadiya said, "The increase in export by 40% in next five years means that the capacity of the diamond manufacturing will increase. Since Surat is the largest manufacturing centre, we expect a lot of changes. This will further drive new opportunities for the manufacturers and create more jobs."

Resources: times of india

India rice shipments slow as stronger rupee lifts export prices

MUMBAI (Reuters) - India's non-basmati rice exports are likely to slow over the next few months as its shipments of the grain have become too expensive on the world market due to a rally in the rupee and an increase in local paddy prices.

Lower shipments from the world's biggest rice exporter will give rivals Vietnam, Thailand and Cambodia a chance to raise their share of the global market.

"Other origins are cheaper than India. There will be definitely a slowdown in exports," Nitin Gupta, business head of rice at Olam India, told Reuters.

India was offering 5 percent broken parboiled rice this week at around $410 a tonne, free-on-board (FOB) from Kakinada port on the east coast.

In comparison, Thai rice was offered at between $390 and $392 a tonne, and Vietnam rice was quoted at $400 to $405 a tonne.

"Due to an appreciating rupee, we can't match prices quoted by Vietnam or Thailand," said M. Adishankar, executive director at Sri Lalitha, a leading exporter based at Kakinada.

The rupee has risen more than 6.5 percent so far in 2017, reaching its highest in more than two years. A stronger rupee means rice shippers have to raise their dollar-denominated export prices to cover their purchases and other costs.
Key buyers of Indian rice in Africa - such as Benin, Senegal and Guinea - were not comfortable buying at the current level, Adishankar said.

Last month, India's high prices resulted in suspension of a government-to-government deal with Bangladesh, which needs to import rice to replenish stocks hit by flash floods.

After the deal with India was called off, Bangladesh agreed to buy 1 million tonnes of rice from Cambodia.

In India, paddy rice prices are still rising as most of the supplies from the winter crop have already been consumed.
"Until new summer crops enter into the market from October, paddy supply will remain tight," said a Kakinada-based exporter who declined to be named.

Indian farmers had planted 28 million hectares of paddy rice as of Aug. 4, up 4.9 percent from a year ago, but lower rainfall in southern states has raised concerns over the harvest.

"If Indian prices come down we can see demand from West African markets from October onwards for Christmas," said Gupta of Olam India.

"Prices need to come down by $10 to $15 (per tonne) to become competitive."

Traders want import cap on moong, urad

Lentils traders in India have demanded that New Delhi extend to moong and urad the import restrictions that now apply to tur, seeking to ensure sufficiently remunerative prices for the two varieties of pulses.

Moong and  Urad  Pulses exports imports

Some traders believe that prices of urad and moong, already ruling much below the state-set levels, will further come under pressure if overseas supplies are allowed to continue.

The Commerce Ministry issued a notification on August 5, making changes in the import policy of tur (pigeon pea) by putting restriction of 2 lakh tonne in imports during a financial year.

The restrictions will apply until 2018. Although the trade still awaits clarification on transit cargo in the high seas and bound for Indian shores, it is also of the opinion that the move would protect local farmers.

"We welcome the decision of the government to restrict tur imports. This will help the farmers by supporting domestic prices," said Bimal Kothari, vice president, Indian Pulses and Grains Association (IPGA).

Almost all the tur that is produced in the world makes its way to India, which is the biggest consumer of tur dal. According to trade estimates, tur production in Africa is expected to be 6 lakh tonnes in 2017, while that in Myanmar about 2.5 lakh tonnes to 3 lakh tonnes.

Tur prices in Africa have plunged from $1,100 tonne in the previous year to about $335tonne at present. Traders have now demanded extension of import restrictions to other pulses and even to allow exports.

"However, the government should act well in time and extend the import restrictions to moong and urad, the harvest of which is just round the corner. As per official data, India is likely to harvest a bumper crop of both urad and moong," said Kothari.

The market rate of urad is about Rs 40/kg against MSP of Rs 54/kg, while market rate of moong is Rs 45/kg to Rs 50/kg against MSP of Rs 55.75/kg.

Despite government procurement, tur prices are still ruling at Rs 43/kg, much below the MSP of Rs 54.50/kg. Traders and millers have demanded timely action by the government for procurement operations of urad and moong. Chana is the only dal the prices of which are now above government support prices.

China's July exports, imports weaker than expected, cloud global outlook

BEIJING: China's exports and imports grew more slowly more than expected in July, raising concerns over whether global demand is starting to cool even as major Western central banks consider scaling back their massive stimulus programmes.

China and Europe have been driving an increasing share of global growth this year as political conflict stymies stimulus policies being pushed by U.S. President Donald Trump.

But China's export growth slowed to 7.2 percent in July from a year earlier, the weakest pace since February and cooling from an 11.3 percent rise in June, official data showed on Tuesday. Analysts had expected a 10.9 percent gain.

China's exports and imports

Imports rose 11.0 percent, the slowest growth since December and down from a 17.2 percent rise in the previous month. That also missed expectations of 16.6 percent growth.

That left the country with a trade surplus of $46.74 billion for the month, the highest since January, compared with forecasts for $46.08 billion and above June's $42.77 billion. The July trade figures are preliminary, with revised data due on July 23.

Asian stock markets went flat after the disappointing China data, which came a day after ratings agency Fitch upgraded its outlook for the world economy for this year and next, citing recoveries in China and other emerging markets.

"Despite an uptick at the end of the second quarter, (China's) trade growth now appears to be on a downward trend. In particular, the sharp decline in import growth since the start of the year suggests that domestic demand is softening," Capital Economics said in a note.

Improving global demand has boosted exports for China and other trade-reliant Asian economies in recent months after several lean years of declining shipments, but investors have been more focused on its strong appetite for imports, particularly for industrial commodities such as iron ore and coal, which have sparked a global price rally.


TRADE FRICTIONS 
China's trade surplus with the United States, its largest export market, rose 5.9 percent in the first seven months of this year to $142.75 billion compared to the year-ago period, even as China's overall trade surplus has declined this year.
China's surplus with the U.S. was $25.2 billion in July, nearly unchanged from June's $25.4 billion, which was the highest since October 2015.

U.S. President Donald Trump is close to a decision on how to respond to what he considers China's unfair trade practices, as Washington prepares to launch an inquiry into Beijing's intellectual property and trade practices.
But America's appetite for Chinese goods appears to have only increased over the years.

The surplus with the U.S. accounted for over 60 percent of China's total surplus in the first half, compared to just 44 percent in the year-ago period, according to China customs data.

China has said that trade between China and the United States benefits both sides and that Beijing is willing to work with Washington to improve their trade relationship.

The United State and China failed last month to agree on major new steps to reduce the U.S. trade deficit with China, casting doubt over Trump's economic and security relations with Beijing.

Tensions between Washington and Beijing have escalated in recent months as Trump has pressed China to cut steel production to ease global oversupply and rein in North Korea's missile programme.

Trump tweeted in late July after the latest North Korea missile test that he was "very disappointed" in China and that Beijing profits from U.S. trade but had done "nothing" for the United States with regards to North Korea, something he would not allow to continue.

A China's vice commerce minister said last week that China's foreign trade faces a mostly positive environment in the second half of the year, but instability and uncertainties still exist.

Centre plans to reduce Indian pharma cos' dependence on Chinese imports

The drug exports to China are minor in terms of value. But, India imports raw materials upto $6 billion, according to Pharmaceuticals Export Promotion Council (Pharmexcil).
The Centre is working on a plan to help decrease the Indian pharmaceutical industry’s dependence on raw material imports from China, amid the growing tension in Sino-Indian relations.

“All government agencies are keen on this. On the directions of the Ministry of Commerce, Pharmexcil and the CSIR-Indian Institute of Chemical Technology (IICT) are working on a Detailed Project Report,” R Udaya Bhaskar, Director-General at Pharmexcil, was quoted as saying in a report by Hindu Business Line.
To achieve this strategic objective, the Ministry of Commerce held a meeting and took inputs from research laboratories to devise a roadmap. The domain experts along with The Council for Scientific and Industrial Research (CSIR) will look more into the matter on August 12.

The drug exports to China are minor in terms of value. But India imports raw materials worth up to $6 billion, according to Pharmaceuticals Export Promotion Council (Pharmexcil).

China is India's largest supplier of Active Pharmaceutical Ingredients. “In some cases, including in the life-saving drugs category, the dependence on Chinese imports is as much as 90 per cent. We have identified about 50-60 drugs for import substitution,” Udaya Bhaskar added.
India recently put on hold a USD 1.3 billion deal, under which Chinese company Shanghai Fosun Pharmaceuticals was to take over Hyderabad-based Gland Pharma. In a separate development last month, the Finance Ministry levied provisional anti-dumping duty on O-acid (Ofloxacin Acid) imports from China.
“If tensions escalate, we worry it will cast a shadow on business,” an executive whose company imports raw materials from China was quoted as saying.