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INDIA TO SET BAN IMPORT OF USED PLANT AND MACHINERY

JULY 2012- The government will soon restrict import of used plant and machinery, a move aimed at safeguarding the productivity and competitiveness of Indian manufacturers.A panel headed by cabinet secretary AK Seth has decided to ban import of machinery more than five years old. "The big worry is that such imports would impact overall productivity and erode competitiveness of the manufacturing sector," said a government official privy to the development.The domestic capital goods industry says imports are partly responsible for the drop in output; a contention supported by government data that showed production of capital goods contracted 4.1% in 2011-12.



GOVERNMENT COMPLETELY LIBERALISES ONION EXPORT

JULY 2012- The government today completely liberalised onion exports, allowing shipments without the bar of a minimum export price, a move which would further boost exports of the vegetable.Earlier, onion exports were allowed without Minimum Export Price (MEP) till July 2."Export of onions is allowed without any MEP," a notification by the Directorate General of Foreign Trade (DGFT) said here.According to experts, the decision would help in protecting farmers' interest.India's onion exports rose by 15 per cent in last fiscal at 15.48 lakh tonnes against 13.40 lakh tonnes in the previous year on higher production, which increased to 157.48 lakh tonnes from 151.17 lakh tonnes.



100% FDI IN SINGLE BRAND RETAIL

JAN 2012- The Department of Industrial Policy & Promotion, Ministry of Commerce & Industry, Government of India has...formally removed the restrictions on foreign investment in single-brand retail sector by allowing 100 per cent Foreign Direct Investments (FDI) in this sector. However, it has put on hold the proposal for allowing up to 51 per cent FDI in multi-brand retail.



FOREIGN INDIVIDUALS ALLOWED TO INVEST IN THE INDIAN STOCK MARKETS

JAN 2012- The government of India took a major policy decision to allow qualified foreign investors (QFIs) to directly invest in the Indian equity market. The step has been taken to widen the class of investors, attract more foreign funds, reduce market volatility and deepen the Indian capital market. There have been huge foreign capital outflows from the domestic equity market in recent months, which has resulted in volatility in the stock market and a sharp depreciation of the rupee vis-a-vis the dollar. With the further opening up of the stock market to a new class of foreign investors, the government hopes to attract more capital to stem the outflow.



FOREIGN AIRLINES MAY BE ALLOWED UPTO 49% IN INDIAN DOMESTIC

JAN 2012- The civil aviation ministry is likely to drop its opposition to higher investment by foreign airlines in the aviation sector and agree to let them hold up to 49% in domestic carriers, handing out a possible lifeline to cash-strapped airlines. At present, foreign carriers such as British Airways, Singapore Airlines and Emirates are banned from directly pumping money into the aviation sector. The aviation ministry had traditionally been opposed to allowing international airlines to invest in local carriers, but had relaxed its opposition, partly as a result of hectic lobbying by some loss-making players such as Kingfisher Airlines and GoAir.



GOVERNMENT TO CUT COAL ALLOCATION TO COMPANIES

SEPT 2011- The Indian government will slash the allocation of coal to companies that are not using the dry fuel for their promised projects. The government will cut the coal allocation of the non-serious power, steel and cement companies and would allocate the same to the companies whose projects are in the advance stage. This decision of government has come in wake of need to provide additional fuel to the power plants that are suffering from the coal shortage. Around 17,000 Mega Watt (MW) capacity projects are stuck due to coal shortage and another 5,593 MW power plants approved in 2009-10 are producing only 45 % to 50 % of their actual capacity.



EU HITS INDIA WITH 5-YEAR TARIFFS ON STAINLESS STEEL BARS

JUNE 2011- The European Union imposed five- year tariffs on stainless steel from India, saying EU producers including Acerinox SA (ACX) are victims of subsidies to Indian competitors such as Mukand Ltd. The EU duties as high as 4.3 percent aim to counter alleged trade-distorting Indian aid to exporters of stainless steel bars and rods, which are used in domestic appliances, cars and medical instruments. The levies affect EU imports worth around 40 million euros ($57 million) in 2009. The five-year duties match provisional measures were introduced in December 2010 and has taken effect from April 30th 2011.



INDIA REMOVES EXPORT QUOTAS FOR COTTON YARN STARTING APRIL

MAY 2011- As a first positive step towards removing significant export restrictions for cotton and cotton products, India has put an end to its export restrictions for cotton yarn. The export of cotton yarn had been restricted by quantitative limits since 22 December 2010 with the level being fixed at 720 million kilograms for the financial year 2010-11. As India is one of the main EU import sources for cotton products, these measures have seriously affected EU industry. On 31 March 2011, the Indian Government published a notification (No. 49 (RE-2010)/2009-14) removing the restrictions on export of cotton yarn with effect from 1 April 2011. Export contracts will still have to be registered with the Directorate General for Foreign Trade.



GOVT. OF INDIA PARTIALLY INCREASES DUTY ON CKD CARS FROM 10% TO 30%

MAR 2011- The govt. has provided some relief by increasing the excise duty on CKD (Completely Knocked Down) cars from 10 per cent to 30 per cent and not 60 per cent as originally announced in the Union Budget for 2011-12. This means that the ruling will cause a price increase on Indian assembled cars such as the BMW 5 Series and Audi A6 to go up by as much a Rs 3-5 lacs. To go into force from April 1, it may affect those involved in CKD operations in the short term sales. On the other hand, the likes of Mercedes-Benz who assemble their engines for the C and E-Class at the Force Motors facility in Pune are not expected to be impacted and may benefit from it.



ESTABLISHING BUSINESS IN INDIA MADE EASY

MARCH 2011 - In a further attempt to enable the corporate sector in India to operate in a regulatory environment of best international practices that fosters entrepreneurship, investment and growth, the Ministry of Corporate Affairs issued a General Circular No. 6/2011 dated March 8, 2011 to all the Regional Directors, the Registrar of Companies, and all Official Liquidators in relation to simplifying the process of incorporation of companies and establishment of principal place of business in India by foreign companies under the provisions of the Companies Act, 1956.



BAN ON PULSES EXPORT EXTENDED

FEB 2011 - In an effort to ease the burden of rising food prices the government extended the ban on export of pulses for an indefinite period and released additional quota of wheat and rice for various states to be sold at subsidized rates through ration shops. The Empowered Group of Ministers on food, headed by FM Pranab Mukherjee, reviewed the price situation in the country and also decided to allow duty-free import of pulses until March 2012. The government banned export of pulses, which have a weight of 0.72% in the wholesale price index.

BAN ON ONIONS EXPORT TO TAME PRICES

JAN 2011 - The government on the 20th of December decided to suspend onion exports till January 15 to improve domestic supplies as onion prices went through the roof doubling in just one day due to failure of kharif crop. Supplies of onion in all parts of the country have been badly hit due to unseasonal rains in Maharashtra and Rajasthan, two major grower of onion in the country. After an emergency meeting of the food ministry, agriculture cooperative major Nafed, which regulates onion exports, has been asked to stop giving fresh clearance to exporters. The government has also made exports almost impossible for those who are already in possession of 'No objection Certificate' (NOC) given by Nafed.