Category: Economy

The United States and Saudi Arabia are negotiating to obtain metals in Africa to support their transition to alternative energy sources, said a media report. A government-supported Saudi enterprise would purchase stakes in $15 billion worth of mining assets in African countries such as the Democratic Republic of the Congo, Guinea, and Namibia, allowing US businesses to purchase some of the production.

In July, Saudi Arabian Mining Co (Ma’aden) and the Saudi Public Investment Fund (PIF) acquired 10% of Brazilian Vale’s base metal unit in a similar deal; American investment group Engine No. 1 had acquired 3%.

The media report added that the PIF contacted Congo in June about investing $3 billion, through its joint venture (JV) with Ma’aden, into the country’s cobalt, copper, and tantalum industries. The JV between the PIF and Ma’aden, Manara is also concentrating on nickel, lithium, and iron ore.

The White House is looking for financial support from other sovereign wealth funds, but negotiations with Saudi Arabia have advanced the most, added the news report.

Metals and minerals are vital for energy transition, such as batteries for electric cars.

Norway’s $1.4 trillion sovereign wealth fund is closing its only office in China, it said on September 7, though it will continue to invest in the country.

The fund, which is one of the world’s biggest investors, is among a number of financial firms reviewing their presence in China due to the tightening of regulatory oversight, which is affecting the political ties between Beijing and the West. In April, Canada’s third-largest pension fund, Ontario Teachers’ Pension Plan closed its Hong Kong-based China equity investment team earlier this year. One of the world’s largest pension funds, it would no longer have country-focused stock-picking teams based in Asia.

As of the end of 2022, Norges Bank Investment Management (NBIM), which operates the Norwegian fund, owned shares worth about $42 billion in about 850 Chinese companies. These investments will now be managed from the firm’s Asia hub in Singapore. The decision to close its Shanghai office was driven by “operational considerations” and does not affect the fund’s investments or its investment strategy in China, NBIM said in a statement.

NBIM set up its Shanghai office in November 2007, a year after the Chinese regulator granted the Norwegian sovereign wealth fund a license to trade directly in mainland China’s stock exchanges. It was the firm’s first Asian office. It opened another office in Singapore in 2010.

Foxconn Technology Group Chairman Young Liu has backed India as an important country for the future of manufacturing, saying that the opportunities for development of electronics manufacturing and industrial chains in the country were huge.

Speaking to the media at a group event in Taipei, Liu said that India would be able to build the ecosystem faster than China, which took 30 years, on the back of experience and new technologies such as artificial intelligence (AI).

In July this year, while addressing SemiconIndia 2023, Liu said that he was optimistic about the direction of India’s semiconductor roadmap and asserted that Taiwan would be India’s most trusted and reliable partner.

Operational in India since 2005, Foxconn has been making smartphones for Xiaomi over the past couple of years. The largest contract manufacturer of iPhones in the world is also the largest maker of iPhones in India. It is also keen to set up a semiconductor manufacturing plant in the country. In another statement, Liu had said that the company’s Indian arm has achieved a turnover of about $10 billion on an annual basis, and that there is a lot of investment potential in the South Asian country. The company that operates nine campuses in India, across Andhra Pradesh and Tamil Nadu, intends to expand its presence through manufacturing campuses in Karnataka and Telangana, he added. 

Singapore’s Energy Market Authority (EMA) on September 8 gave conditional approvals for five companies to import 2 gigawatt (GW) of low-carbon electricity from Indonesia.

The five companies managing the projects are Pacific Medco Solar (formed by PacificLight Renewables, Medco Power Global and Gallant Venture), Adaro Solar International (formed by PT Adaro Clean Energy Indonesia), EDP Renewables APAC, Vanda RE (formed by Gurin Energy and Gentari International Renewables) and Keppel Energy. Their import capacities have been approved at 0.6GW, 0.4GW, 0.4GW, 0.3GW and 0.3GW, respectively.

With these projects, solar photovoltaics (PV) and battery energy storage systems (BESS) manufacturing plants will be set up in Indonesia. The EMA added that these projects will aim to start commercial operations from the end of 2027. The companies will next conduct marine surveys on the proposed route for their subsea power cables, as approved by the Indonesian authorities.

The conditional approvals are built on related memoranda of understandings (MOUs) between Singapore and Indonesia, including one on low-carbon energy and cross-border electricity interconnection signed on September 8 by Indonesia’s Minister of Energy and Mineral Resources Arifin Tasrif and Singapore’s Second Minister for Trade and Industry Tan See Leng on the sidelines of the Indonesia Sustainability Forum held in Jakarta on September 7-8.

Lauding the India-Middle East-Europe Economic Corridor (IMEC) as a “game-changing investment” and a key element in global job creation and food security, US President Joe Biden emphasised the global significance of the IMEC launched on September 9 in New Delhi.

Biden highlighted his country’s commitment to investing in the novel rail line extending from Angola towards the Indian Ocean, and envisaged it as a crucial step to foster job creation and enhance food security on a global level. He forecasted the term ‘economic corridor’ to resonate prominently in the forthcoming decade.

The IMEC is in collaboration with the UAE, Saudi Arabia, the European Union, France, Italy, Germany, and the US. Prime Minister of India, Narendra Modi conveyed that this corridor would be a major medium of economic integration between India, West Asia, and Europe, and show a sustainable way to the whole world.

The collaborative project aims to accomplish greater economic integration between nations through its two outlined paths: the east corridor connecting India to the Arabian Gulf and the northern artery binding the Arabian Gulf to Europe. These corridors will leverage a sophisticated network of railways and shipping routes backed by digital and electricity cable networks and clean hydrogen export pipelines to facilitate smoother transit of goods and services.

India’s online payments platform, unified payments interface (UPI) achieved a remarkable milestone by crossing 10 billion transactions in August with a total number of transactions reaching a record 10.58 billion.

According to the National Payments Corporation of India (NPCI), which manages the real-time payments system, UPI transactions surged 67% year-on-year, raising the total transaction amount 47% year-on-year to ₹15.76 lakh crore in August.

In July, UPI transactions of 9.96 billion were recorded, while the transaction amount stood at ₹15.34 lakh crore. The system saw 9.34 billion transactions in June 2023 with a total transaction amount of ₹14.75 lakh crore.

After its huge success in the domestic market, India is in talks with other countries to take the payment system global, especially in developing countries. The country also showcased the UPI system at the G20 meetings, enabling the delegates to experience real-time transactions over the phone. India’s neighbours Nepal and Bhutan have adopted the UPI system, while the payment system is expected to be operationalised in Sri Lanka soon.

India also entered into a partnership with Singapore to link the payment systems for an easier flow of remittances. The country is helping build digital infrastructure and platforms for partner countries and enter into commercial linkages and partnerships with existing financial platforms to make payments for Indian travellers and migrants easier.

German Chancellor Olaf Scholz said the upcoming G20 summit in India remains important despite the absence of Russia and China. Speaking to German radio station Deutschlandfunk on September 1, he said that the forum still has an important contribution to make and a “big damn obligation” to fulfil, particularly as BRICS – a grouping of the world economies of Brazil, Russia, India, China and South Africa – grows in significance.

India, the President of the G20, will host global leaders for the Summit on September 9 and 10 in New Delhi. US President Joe Biden will travel to India on September 7 to attend the summit. He will also have a bilateral meeting with Prime Minister Narendra Modi on the sidelines of the summit, announced the White House.

On September 8, he will participate in a bilateral meeting with PM Modi. During the leadership summit, he and G20 partners will discuss a range of joint efforts to tackle global issues, including the clean energy transition and combating climate change. They will also mitigate the economic and social impacts of the Russia-Ukraine war, and increase the capacity of multilateral development banks, including the World Bank, to better fight poverty, including by addressing global challenges.

Bilateral trade between India and Kuwait has touched an all-time-high of $12.5 billion, Indian Ambassador to Kuwait Adarsh Swaika said in an interview.

Trade between the two countries has seen a 90% yearly jump. While currently the trade is skewed towards hydrocarbon exports from Kuwait and exports of mainly food products from India, bilateral trade has the potential for diversification, the envoy added.

Swaika underlined the excellent possibilities available between the two countries across sectors, such as pharmaceuticals and medical devices, automobiles and related spares, electronics goods and components, high-efficiency solar PV modules, textiles and apparel, white goods, and ceramics. The main potential area of cooperation is in the field of investments from Kuwait to India because of the attractive political and financial investment climate that the country provides, the ambassador added.

Swaika added that Kuwait Investment Authority’s (KIA) investments in India are extraordinarily significant, and expressed hope for further acquisitions. In the interview published on August 23, he said that both countries are working to enhance relations in the areas of food security, tourism, and health cooperation. He noted that medical and health tourism offers tremendous potential for further growth, and India is exploring whether Indian private hospitals can set up their chains in Kuwait.

The Pradhan Mantri Jan-Dhan Yojana (PMJDY) – the world’s largest financial inclusion mission – crossed the 500 million mark on August 28 in nine years of its launch, with over ₹2 lakh crore deposits and over 55.5% of the bank accounts belonging to women, said Union Finance Minister Nirmala Sitharaman.

In a statement, the union minister said the last nine years of PMJDY-led interventions and digital transformation revolutionised financial inclusion in the country. She added it is heartening to note that over 500 million people have been brought into the formal banking system. She underlined the collaborative efforts of stakeholders, banks, insurance companies, and government officials to make the scheme a pivotal initiative.

Of the total bank accounts opened under PMJDY, 67% were opened in rural and semi-urban areas. About 340 million RuPay cards have been issued to these accounts without charge, which also provides for a ₹2 lakh accident insurance cover.

Financial inclusion also brings savings of the poor into the formal financial system, provides an avenue to remit money to their families in villages, and takes them out of the clutches of the usurious money lenders, added the minister.

PMJDY was first mentioned by Prime Minister Narendra Modi in his Independence Day address on August 15, 2014.

The Government of India collected Rs 6.53 lakh crore as gross direct tax up to August 10, up 15.73% than the gross collections for the corresponding period of last year, the Ministry of Finance said. The Centre also issued refunds amounting to Rs. 0.69 lakh crore during April 1, 2023 to August 10, 2023, which were 3.73% higher than refunds issued during the same period in the preceding year.

Direct Tax collection, net of refunds, stands at Rs 5.84 lakh crore, which is 17.33% higher than the net collections for the corresponding period of last year. This collection is 32.03 percent of the total Budget Estimates of Direct Taxes for FY 2023-24, the ministry said in a statement.

India collects direct taxes mainly through corporate and personal income tax. Even with the GST regime, the government exchequer makes over half of its revenue through direct taxes. Both taxes are collected by the Central Board of Direct Taxes (CBDT), a department under the Ministry of Finance. Direct tax collection in India is carried out through a self-assessment system, where individuals and companies are required to self-assess their tax liability and make the payment accordingly.