Category: Economy

Indonesia reported a $4.42 billion trade surplus in November, double analysts’ forecasts of $2.21 billion. The rise came as exports surged and imports fell below market expectations, according to official data released on Monday.  

The November surplus marked the largest since March. It followed a slightly revised October surplus of $2.48 billion. Analysts believe this trade data will be a key factor in the central bank’s upcoming monetary policy review on Wednesday, where no change to key rates is expected.  

Exports grew 9.14% year-on-year to $24.01 billion, far exceeding the expected 4.92% rise. The growth was driven by higher shipments of agricultural and manufactured products, like cocoa butter and powder. However, shipments of top commodities like coal dropped 4.4%, while palm oil shipments increased only 2.2%.  

Imports remained flat at $19.59 billion, defying forecasts of a 6.15% rise. Key imports, including machinery, electronics, and steel, all recorded declines. Following the trade data, Indonesia’s rupiah strengthened slightly but stayed near four-month lows against the U.S. dollar.

Britain announced a major overhaul of its planning system to boost growth and build 1.5 million homes in five years. Prime Minister Keir Starmer called the current planning system a “chokehold” on growth and pledged bold reforms.

“The housing crisis means the dream of homeownership feels distant for many,” Starmer said. “Our plan puts builders, not blockers, first. We’ll fix the broken system, provide homes for working families, and drive growth.”

The new plan requires local authorities to set housebuilding timetables within 12 weeks or face government intervention. It also introduces mandatory housing targets, prioritizing areas with the least affordable housing.

The Local Government Association welcomed reforms but stressed the need to address workforce shortages, construction costs, and local councils’ financial health. “Faster planning decisions alone won’t guarantee more houses,” it stated.

The move aims to simplify approvals, fast-track developments, and increase home availability, supporting the broader goal of economic growth and affordable housing for all.

Prime Minister Narendra Modi will visit Prayagraj on December 13 for a three-hour tour, The Indian Express reported. During his visit, he will inaugurate and lay the foundation for projects worth ₹7,000 crore. He will also perform a puja at the Sangam.

PM Modi is set to arrive around 11 am and will travel from Arail Ghat to Quila Ghat on a hybrid electric catamaran named after Nishadraj, which he previously launched in Varanasi.

Most of the projects are linked to road and corridor development, with a key highlight being the Shringverpur Dham corridor. Known as the “Kingdom of Nishadraj” in the Ramayana, the corridor aims to make pilgrim visits to Shringverpur easier.

Modi will also inaugurate projects related to railways, airports, irrigation, road development, and the beautification of ghats. Additionally, he will launch the “Kumbh Sahayak Chatbot” to support pilgrims.

The visit emphasizes infrastructure development and better connectivity, with a strong focus on boosting tourism and pilgrimage experiences in the region.

The Indian government will require clean energy firms to use locally made solar cells in government projects from June 2026. The Renewable Energy Ministry announced that only solar cells from an approved list of companies will be allowed. This move aims to reduce reliance on Chinese imports.

India already mandates the use of locally made photovoltaic (PV) modules for government projects. The new rule now extends to solar cells as well.

The government aims to boost non-fossil fuel capacity to 500 gigawatts (GW) by 2030, up from the current 156 GW. India’s current PV module-making capacity is around 80 GW, but its solar cell-making capacity is just over 7 GW. Currently, companies rely heavily on Chinese solar cells to manufacture PV modules.

The Renewable Energy Ministry stated that a list of approved cell manufacturers will be released soon. This comes as India’s cell-making capacity is expected to increase significantly next year.Industry Experts on the Impact
Vikram V, Vice President of Corporate Ratings at ICRA, said, “Modules using locally made cells may be costlier than imported ones. Scaling up production and improving cost-efficiency will be crucial for India’s solar cell market.”

The 7th CICA Business Council Plenary Session and the 9th CICA Business Forum took place in Astana this November, bringing together representatives from India and other Asian nations. The event focused on strengthening regional economic ties and enhancing cooperation between businesses and governments.

With participation from nearly 100 companies across Asia, the forum resulted in key agreements aimed at fostering growth and development. Major areas of focus included training programs, joint investment initiatives, and new formats for business-government interaction. These initiatives are expected to streamline collaboration and boost trade among CICA member states.

One of the most notable highlights was the report on Kazakhstan’s trade with CICA members, which reached an impressive $82 billion in 2023. The figure reflects the growing role of CICA in promoting cross-border trade and investment. As an active participant, India remains a key player in strengthening these ties, contributing to increased trade volumes and investment opportunities.

The successful conclusion of the plenary and forum highlights CICA’s growing influence as a platform for economic cooperation in Asia. By encouraging member states to collaborate on training, investment, and policy alignment, the forum aims to create a more integrated and prosperous Asian economy. 

Abu Dhabi, the capital of the United Arab Emirates (UAE), announced new measures on Wednesday to simplify business processes as part of its economic diversification strategy away from oil.

The emirate, which holds over 90% of the UAE’s oil reserves, introduced the Abu Dhabi Registration Authority (ADRA). This centralized body will serve as the sole platform for business registration, according to an official statement.

Like other oil-exporting regions, Abu Dhabi is accelerating its shift toward sectors such as tourism, logistics, manufacturing, and industry to achieve sustainable economic growth. This shift aligns with global efforts to reduce reliance on fossil fuels.

The ADRA will operate under Abu Dhabi’s Department of Economic Development (ADDED), which plays a key role in streamlining government strategy. ADDED aims to attract foreign investment, encourage local businesses, and ensure economic compliance with UAE and international regulations.

“We want to make business easier and simpler,” said Ahmed Jasim Al Zaabi, chairman of ADDED, during the opening session of Abu Dhabi Business Week. He emphasized that centralizing business registration would enhance regulatory compliance.

Abu Dhabi’s economy grew by 4.1% in the second quarter of 2024, based on preliminary government data.

The government has removed the windfall tax on domestically produced crude oil and exports of petrol, diesel, and aviation turbine fuel, addressing industry demands after falling international oil prices significantly reduced export values. The Department of Revenue announced the decision on Monday, rescinding the June 2022 notifications that imposed the tax, with immediate effect.

“The industry had been urging the government to withdraw the tax, arguing it was no longer justified given the prolonged period of subdued international oil prices,” an official said anonymously.

The windfall tax, introduced in July 2022, aimed to curb private refiners from cutting domestic fuel supplies to profit from surging overseas demand during a time when Brent crude prices were around $110-120 per barrel. However, since August 2024, Brent crude has remained below $80 per barrel, currently around $72.

Latest trade data shows the impact of declining global oil prices, with India’s per-unit petroleum export value dropping to $312.50 per tonne in the first half of 2024-25, compared to $792 per tonne in the same period last year, despite higher export volumes.

Saudi Arabia, the world’s top oil exporter, is likely to cut crude prices for Asian buyers in January to their lowest levels in years, according to traders. The January official selling price (OSP) for Arab Light could drop by 70 to 90 cents per barrel from December, marking at least a four-year low, a Reuters survey of six Asian refinery sources revealed.

“The weaker Middle East benchmark prices in November are driving the cuts,” said traders. Despite TotalEnergies purchasing 15.5 million barrels of crude in the S&P Global Platts window, the gap between front and third-month Dubai prices narrowed by 86 cents last month, reducing the backwardation spread. (Backwardation is when near-term prices exceed future prices.)

Spot premiums for January-loading Middle East grades also halved from the previous month due to weak demand. Similarly, Arab Extra Light’s OSP is expected to follow Arab Light’s drop, while heavier grades like Arab Medium and Arab Heavy may see steeper price reductions as fuel oil margins continue to decline.

“Chinese refining margins remain poor, and we’re hoping for larger price cuts for heavy grades,” one respondent added.

Traders also noted that the upcoming OPEC+ meeting on December 5 could influence supply in early 2025 and potentially impact Saudi Aramco’s pricing decisions. Many expect the state oil giant to announce January prices only after the meeting.

The Indian government is ramping up efforts to achieve its 6.5%-7% economic growth target for this fiscal year, despite slower-than-expected growth from July to September. Economic Affairs Secretary Ajay Seth expressed confidence that growth would pick up in the second half of the year.

“Investor-friendly policies are in place, and tax rules have been simplified to attract more investments,” Junior Finance Minister Pankaj Chaudhary told lawmakers on Monday. The government is also focusing on boosting domestic manufacturing with increased incentives for electric vehicle makers and plans to raise the FDI limit in the insurance sector to 100%.

Prime Minister Narendra Modi, fresh from electoral victories in Maharashtra and Haryana, is expected to accelerate infrastructure spending as part of the $576 billion budget unveiled in July. Analysts believe this spending surge, alongside other measures, will provide a significant push to growth in the coming months.

“Government expenditure over the past few weeks will likely drive growth in the December quarter,” said economist Pranjul Bhand. The Reserve Bank of India may also face added pressure to adjust interest rates to support economic recovery.

India has exported organic food products worth nearly $450 million as of November 25 in the current fiscal year, according to government data. The exports totaled 2,63,050 tonnes, valued at $447.73 million, a statement revealed on Monday.

Union Minister of State for Food Processing Industries, Navneet Singh Bittu, shared details in a written reply to the Lok Sabha, outlining organic export trends over the past five years.

In 2019-20, India exported 6,38,998 tonnes of organic products worth $689.10 million. The following year, exports rose to 8,88,179.68 tonnes, earning $1,040.95 million. Exports then tapered off, recording 4,60,320.40 tonnes for $771.96 million in 2021-22, 3,12,800.51 tonnes for $708.33 million in 2022-23, and 2,61,029 tonnes for $494.80 million in 2023-24.

Bittu highlighted the role of the Agricultural & Processed Food Products Export Development Authority (APEDA) in implementing the National Programme for Organic Production (NPOP).

“NPOP oversees certification, organic farming standards, and marketing. It certifies operators for production, processing, and trading,” he stated. Currently, India has 1,016 organic-certified processing units under the program.