Saudi Arabian Monetary Authority and UAE Central Bank announced the launch of common digital currency ‘Aber’ to forge closer financial ties. On 29th Jan 2019, both the apex monetary bodies released a joint statement mentioning that the new digital currency will be used in financial statements between the two countries through Blockchains and Distributed Ledgers technologies.
This new digital currency also serves as an additional medium for financial remittances between the two countries. In the initial stages, this pilot project concentrates on the technical aspects and focuses on the practical application of the modern technologies and finding out their impact on the reduction of remittance costs and assessment of technical risks involved in it and ways to deal with them. Initially, the use of this digital currency will be restricted to a limited number of banks in each state. If no technical issues are encountered, economic and legal requirements for future users will be discussed. It is the first time when monetary authorities of both countries are cooperating to use blockchain technology. With the implementation of the project, it is also possible to use the system as an additional reserve system for the settlement of domestic central payments in case of any disruption.
The Union Cabinet chaired by Prime Minister Narendra Modi gave its approval of USD 75 Billion for entering into a Bilateral Swap Arrangement (BSA), a currency swap agreement, between India and Japan thereby authorizing RBI to sign an agreement between Reserve Bank of India and Bank of Japan.
The agreement is concluded between the premiers of both the countries at a summitlevel meeting at Yamanashi, Japan. It is essentially meant to exchange and re-exchange a maximum amount of USD 75 Billion for maintaining the appropriate levels of the balance of payments for meeting short-term deficiencies in foreign payments.
This arrangement enables both countries to use the agreed amount of capital. Such an agreement is an exemplar mutual cooperation between the two countries for helping each other.
The 16th ASEAN-India Summit 2019 was held in Thailand in November 2019. The summit was chaired by H.E. General Prayut Chan-oCha, Prime Minister of Kingdom of Thailand. Along with 16th ASEAN-India Summit 2019, there are other summits that took place such as 35th ASEAN Summit, 14th East Asia Summit and 3rd meeting of RCEP.
The honorable Indian Prime Minister Narendra Modi attended and co-chaired the summit along with the heads of member countries – Indonesia, Thailand, Singapore, Malaysia, Philippines, Vietnam, Myanmar, Cambodia, Brunei, and Laos. The summit brought up and discussed topics related to promotion on ASEAN-India Strategic Partnership and ways to increase maritime cooperation, trade, investments, connectivity and partnership in science, technology and innovation. At the summit, India extended USD $ 1 billion as line of credit for the improvement of physical and digital connectivity.
In November 2019, German Chancellor Angela Merkel visited India and met Indian Prime Minister Narendra Modi and co-chaired the 5th InterGovernmental Consultations (IGC).
Both countries acceded to sign seventeen agreements in the fields of agriculture, ayurveda, maritime technology, migration, occupational diseases and yoga. Five Joint Declarations of Intent were also exchanged on strategic projects, partnership for green urban mobility, research and development on Artificial Intelligence (AI) and cooperation in the field of prevention of marine litter.
Following are some significant India-Germany MoUs: An Implementing Arrangement on Exchange of Personnel between ISRO and German Aerospace Centre – Joint Declarations of Intent and MoUs on:
- Cooperation in the Field of Civil Aviation
- Cooperation within the International Smart Cities Network
- Cooperation between the Field of Skills Development and Vocational Education and Training
- Strengthening Economic Cooperation in the field of Start-ups
- Establishment of Bilateral Cooperation Project regarding Agricultural Market Development
- Exchanged between Siemens Limited, India and MSDE and German Ministry for Economic Cooperation and Development on Skills for Sustainable Growth
- Occupational Diseases, Rehabilitation and vocational training of Insured Persons & workers with disabilities
Singapore companies have awoken to a hunger that’s been acquiring companies globally, from real estate to engineering. Comparing to the figure of last year’s US$41.9 billion, the overseas deals this past September are almost double at US$91 billion. The increase in deals was 7.8% to about 468 deals this year. This far outweighed the number of global mergers and acquisitions that only grew by 2%. China remains a prime target for Singapore companies like Temasek, GIC, Singapore Technologies Engineering Ltd., CapitaLand Ltd., etc. as they have invested heavily in various Chinese companies.
The number of these transactions increased more than five times its previous value from US$3.8 billion to US$19.5 billion.
Facebook, the online social media and social networking service company has announced a new digital currency called Libra, for simplifying payments. This new digital currency is based on the blockchain technology and allows billions of users to make financial transactions across the globe. It’s a simple digital currency and financial infrastructure that is developed to create a more inclusive financial system. Its three most promising features are:
- It is created on a completely secure, scalable and reliable blockchain.
- It’s backed by a reserve of real assets that are meant for building trust in its intrinsic value.
- It is governed by an independent Libra association that consists of diversified businesses, non-profit and multilateral organizations and academic institutions.
For every Libra created, a cache of bank deposits and shortterm government securities is set aside in Libra Reserve. This reserve will be administered by Libra Association that will ensure preserving the value of the currency. The initial members of this association will work for finalizing the association’s charter and become the ‘founding members’ upon its completion. The current members include Mastercard, PayPal, PayU, Visa, Stripe, eBay, Facebook, Lyft, Spotify AB, Uber, Vodafone Group, Bison Trails, Coinbase, Inc., Xapo Holding, Ribbit Capital, Thrive Capital, Kiva, Mercy Corps, Women’s World Banking, etc.
For many banks, payment wallet companies & credit card companies, this could be a real game changer. With more than 2.40 billion worldwide Facebook users, this new digital currency is set to revolutionize the global payments and transfers.
The International Monetary Fund has appointed Bulgarian economist Kristalina Georgieva as its new Managing Director for a term of five years.
With her appointment, she became the first person from an emerging economy to head the global lender. Additionally, she is also the second woman ever to lead the 189-member institution.
As a center-right politician who witnessed communism, she built a reputation during her stint at the World Bank as CEO.The selection had been all but guaranteed after the IMF said earlier that she is the sole candidate.
She was selected by 24-member Executive Board representing the IMF’s 189 member countries. She was backed by French President Emmanuel Macron and won support last month from the rest of the European Union as well as the tacit backing of the United States.
She took her position as Managing Director in October 2019, replacing Christine Lagarde who would take over European Central Bank later this year. As a Managing Director, she is the Chief of the IMF’s operating staff and Chair of the Executive Board. She will be assisted by four Deputy Managing Directors in the operation of the fund, which serves its membership through about 2,700 staff.
The governments of India, Japan, and Sri Lanka, through a tripartite agreement, have decided to develop a container terminal at Port of Colombo.
A Memorandum of Cooperation (MoC) was signed in Colombo by Sri Lankan Port Minister Salaga Ratnayake, Indian High Commissioner to Sri Lanka Taranjit Singh Sandhu, and Japanese delegate to develop East Container Terminal (ECT).
According to media reports, the new container terminal is located at the recently developed south part of Post of Colombo and will enable the related countries to develop a facility for large container ships.
After getting approval from the Sri Lankan cabinet, the three countries will set up a company to operate the terminal.
The cost of developing the container terminal is estimated around $500-700 million and is owned by Sri Lanka Port Authority holding 51% majority stake and rest 49% jointly by India and Japan. Japan is going to provide a soft loan at an interest rate of 0.1% for the duration of 40 years with a grace period of 10 years.
Participation of India and Japan in the development of Sri Lanka’s container terminal is being seen as strategic development as more than 70% of India’s transshipment is handled at Colombo ports. Moreover, it’s going to neutralize the growing Chinese influence over the island nation in which the country has poured money under its Belt and Road Initiative (BRI) plan.
This new East Container Terminal will be developed next to $500 million Colombo International Container Terminal whose majority 85% stake is owned by China and rest 15% by Sri Lanka’s SLPA.
The United Arab Emirates recently launched the “Golden Card” Permanent Residency Scheme for expatriates. The scheme, launched by the UAE Prime Minister Sheikh Mohammed bin Rashid Al-Maktoum, is meant to pursue and attract wealthy individuals and exceptional talents such as doctors, engineers, scientists, students and artists from all over the world.
Dubai’s ruler took to social media and stated, “We want them to be permanent partners in our journey. Residents are an indispensable part of our country. The first batch of 6,800 investors with Dh100 billion worth of investments will be granted the “Golden Card.”
According to General Mohammed Ahmed Al Marri, Director General of the General Directorate of Residency and Foreigners Affairs in Dubai (GDRFA), the department has started issuing permanent residency to the first batch of qualified individuals from over 70 countries.
The scheme of “Golden Card” comes after the last year’s announcement that the country would grant five or ten year residency visas to investors, entrepreneurs, doctors, scientists, and outstanding students to facilitate business and investment environment. The scheme offers a permanent residency with a slew of unprecedented benefits.
The traditionally close and friendly India-United Arab Emirates relations have evolved into a significant partnership in the economic and commercial spheres, as recently, the relations between the two countries have witnessed unprecedented improvement, with leaders from both sides visiting each other’s country and signing crucial agreements in various sectors in a bid to improve relations and trade. The strategic decisions taken would go a long way to help each other grow enormously.