- New roadmap set out to increase trade and investment between UK & India-
- ASSOCHAM / YES BANK projects Indian exports to grow $64billion annually-
- UK’s prominent position as the fourth largest FDI contributor to India-
- India set to surpass China as fastest growing economy in the world in 2016-
The Associated Chambers of Commerce and Industry of India (ASSOCHAM)and the UK India Business Council (UKIBC)jointly signed a new bilateral agreement on Thursday 2nd July at the ASSOCHAM Global Investors’ India Forum, London, to further strengthen UK-India trade and investment corridors and establish a stronger relationship between investors and companies. The event also coincided with the launch of the UK Chapter of ASSOCHAM.
Supporting Indian Prime Minister Narendra Modi’s Make In India programme and in partnership with UK Trade and Investment, the roadmap aims to promote trade delegations and facilitate cross-border business relations to actively engage in identifying projects of mutual interest for Indian and UK businesses to invest.
Mr Vijay Goel, Chairperson of ASSOCHAM UK and Partner of Indian law firm Singhania & Co inaugurated the session and introduced the keynote speakers. He said, “India and the UK share deep commitment to fostering more investment and ASSOCHAM has recognized the need for the changing business and investment environment to encourage this.”
Mr. Rana Kapoor, President of ASSOCHAM and Founder & CEO of YES BANK, led the signing event with the release of a report titled Make in India – Pressing the Pedal. The exclusive report identified several key findings including a prediction that the value of Indian exports are expected to grow $64billion annually, as China loses out to India’s increasingly competitive labour market and growing working population.
Notably, the report underlined the UK’s prominent position as the fourth largest FDI contributor to India and, with India set to surpass China as fastest growing economy in the world in 2016, the UK is set to benefit from India’s energised export drive. The new road map will maximise opportunities for UK businesses and harness India’s potential especially in the fields of manufacturing, infrastructure and renewable energy.
Welcoming the signing of the agreement and the launch of a UK base for the Indian chambers, ASSOCHAM President Mr. Rana Kapoor stated: “India’s potential manufacturing and export-driven growth, key pillars of the India’s government’s Make In India campaign, offers a fantastic opportunity to UK investors and companies.
“As a hub for trade to the European continent, London is an excellent platform for new relationships to be built and we hope the strengthening of this corridor will improve the ease of doing business and provide British and Indian companies, especially in the SME sector, a new era of cross-border cooperation.
“The launch of ASSOCHAM in the UK is a turning point between UK and India relationships. The potential partnership between the UK and India is great but we cannot expect results overnight. To all investors here at this event, do not think twice, just invest: you will be successful.”
He added, “There is a tectonic shift happening in India’s SME sector. I want to commend Prime Minister Narendra Modi for his vision and foresight in tapping India’s vast potential. He has created confidence, conviction and communication, and he has opened up India to a world of possibilities. India is a growth story, and this story is set to continue.’
The ASSOCHAM’s Global Investors’ India Forum saw keynote speeches from Rt. Hon. Patricia Hewitt, Chair, UKIBC, The Rt. Hon. Baroness Sandip Verma, Parliamentary Under Secretary of State for International Development, UK Government, Mr. Michael Boyd, MD, UKTI, Mr. G.P. Hinduja, Co-Chairman, The Hinduja Group and Mr. V.N. Dhoot, Chairman & Managing Director, Videocon Industries.
Mr. G.P. Hinduja, Co-Chairman, The Hinduja Group highlighted the unique position of India and it’s investment potential. He said: “I am British but my heart is Indian. I always look for ways of how I can grow India. The Indian Prime Minister has really put India centre-stage and it really is the right time to invest in India. The world’s future, economic prosperity and success lies in Asia – if India succeeds, then Asia will too. And if Asia succeeds, then so will UK and Europe.” Mr Hinduja also highlighted the effort and contribution of UK’s 1.6mn non-resident Indian audience in enhancing both UK’s and India’s economy.
Rt. Hon. Patricia Hewitt, Chair, UKIBC opened her keynote address by commending Mr Kapoor’s entrepreneurial spirit. She said: “India invests more in the UK than in the EU put together. Under Mr Kapoor’s leadership, ASSOCHAM has gone from strength to strength. By deepening and renewing the UK-India partnership it would be hugely beneficial to both countries.”
Mr. Michael Boyd, MD, UKTI, spoke about India and the UK’s cordial business relations, saying: ‘The UK is the largest G20 investor in India; over the last year, FDI into the UK rose by 50% creating 7,700 jobs.’ He also said that India is the third largest source market for FDI in the UK.
Speaking about the benefits of doing business in the UK, he said: ‘The UK is a popular destination for Indian business investors, and this is because it is easier to do business in the UK; the UK is the eighth best country to do business in.’
Mr. Boyd concluded by saying how this mutually beneficial relationship would increase jobs and direct investment, saying that the ripple effects would be felt throughout.
The Rt. Hon. Baroness Sandip Verma, Parliamentary Under Secretary of State for International Development, UK Government mentioned that her ambition is to have the UK as India’s number one partner. She said: “Without bodes like ASSOCHAM there would be no relationship between India and the UK. There is a real appetite for investment in India but there needs to be an ease for all businesses to enter India,from SMEs to large corporations. I value Mr Kapoor’s vision of creating an entrepreneur valley in India.” She also spoke about the opportunities India is presenting for businesswomen, stating, “India has many women led businesses and we need to encourage this.”
Mr. V.N. Dhoot, Chairman & Managing Director, Videocon Industries, gave the concluding comments by congratulating Rana Kapoor for taking ASSOCHAM to this great level. He said that the aim should now be to take ASSOCHAM to all G20 countries. ‘This is the best time to invest in India, as its economy is booming and it has political stability. I am confident that Mr Narendra Modi will build India in the next five years, it will take time, as Rome wasn’t built in a day, but we will surely get there. India can become an economic superpower in the world’.
Also in attendance at the event was Mr Praful Patel, Former Minister of Heavy Industries and Public Enterprises, Government of India who said: “India is really forging ahead and has its own growth story.”
The event closed with an Interactive Investment Forum to explore how India’s growth story can be fast tracked with confidence and conviction.
For the full report, please see the web link below:
UK’s Sunak extends COVID rescue plan but companies to pay more tax from 2023
By David Milliken and William Schomberg
LONDON (Reuters) – Finance minister Rishi Sunak announced a costly extension of his emergency aid programmes to see Britain’s economy through its current coronavirus lockdown, but announced a tax hike for many businesses as he began to focus on fixing the public finances.
Delivering an annual budget speech on Wednesday, Sunak said the economy will regain its pre-pandemic size in the middle of 2022, six months earlier than previously forecast, helped by Europe’s fastest COVID-19 vaccination programme.
But it will remain 3% smaller in five years’ time than it would have been without the damage wrought by the coronavirus crisis and extra support is needed now as the country remains under coronavirus restrictions, he said.
Among the new support measures was a five-month extension of his huge jobs rescue plan and more help for the self-employed, the continuation of an emergency increase in welfare payments, and an extension of a VAT cut for the hospitality sector.
A tax cut for home-buyers was also extended until the end of June.
“First, we will continue doing whatever it takes to support the British people and businesses through this moment of crisis,” Sunak told parliament.
“Second, once we are on the way to recovery, we will need to begin fixing the public finances – and I want to be honest today about our plans to do that. And, third, in today’s Budget we begin the work of building our future economy.”
Announcing forecasts by the Office for Budgetary Responsibility (OBR), Sunak said the economy was likely to grow by 4% in 2021, slower than a forecast of 5.5% made in November, reflecting the current lockdown which began in January.
Looking further ahead, the OBR forecast gross domestic product would grow 7.3%, 1.7% and 1.6% in 2022, 2023 and 2024 respectively. In November, the OBR had forecast growth in those years of 6.6%, 2.3% and 1.7%.
Sunak promised to do “whatever it takes” to steer the economy through what he hopes will be the final months of pandemic restrictions.
He has already racked up Britain’s highest borrowing since World War Two, which hit an estimated 17% of GDP in the 2020/21 financial year that is about to end and should fall to a still historically high 10.3% in 2021/22.
In a first move to raise taxes, Sunak announced he would raise corporation tax to 25% from 19% from 2023, by which time the economy should be past the pandemic crisis.
“Even after this change the UK will still have the lowest corporation tax rate in the G7 – lower than the United States, Canada, Italy, Japan, Germany and France,” he said.
Businesses with profits of 50,000 pounds or less would pay a new Small Profits Rate, maintained at the current rate of 19%.
Sunak also said he would freeze the amount of money that people can earn tax-free and the threshold for the higher rate of income tax until 2026.
(Writing by William Schomberg; Editing by Catherine Evans)
Renewable diesel boom highlights challenges in clean-energy transition
By Rod Nickel, Stephanie Kelly and Karl Plume
(Reuters) – For 17 years, trucker Colin Birch has been hitting the highways to collect used cooking oil from restaurants.
He works for Vancouver-based renderer West Coast Reduction Ltd, which processes the grease into a material to make renewable diesel, a clean-burning road fuel. That job has recently gotten much harder. Birch is caught between soaring demand for the fuel – driven by U.S. and Canadian government incentives – and scarce cooking oil supplies, because fewer people are eating out during the coronavirus pandemic.
“I just have to hustle more,” said Birch, who now sometimes travels twice as far across British Columbia to collect half as much grease as he once did.
His search is a microcosm of the challenges facing the renewable diesel industry, a niche corner of global road fuel production that refiners and others are betting on for growth in a lower-carbon world. Their main problem: a shortage of the ingredients needed to accelerate production of the fuel.
Unlike other green fuels such as biodiesel, renewable diesel can power conventional auto engines without being blended with diesel derived from crude oil, making it attractive for refiners aiming to produce low-pollution options. Refiners can produce renewable diesel from animal fats and plant oils, in addition to used cooking oil.
Production capacity is expected to nearly quintuple to about 2.65 billion gallons (63 million barrels) over the next three years, investment bank Goldman Sachs said in an October report.
Rising demand is creating both problems and opportunities across an emerging supply chain for the fuel, one small example of how the larger transition to green fuels is upending the energy economy. A renewable diesel boom could also have a profound impact on the agricultural sector by swelling demand for oilseeds like soybeans and canola that compete with other crops for finite planting area, and by driving up food prices.
Local and federal governments in the United States and Canada have created a mix of regulations, taxes or credits to stimulate more production of cleaner fuels. President Joe Biden has promised to move the United States toward net-zero emissions, and Canada’s Clean Fuel Standard requires lower carbon intensity starting in late 2022. California currently has a low-carbon standard that provides tradable credits to clean fuel producers.
But the feedstock supply squeeze is constraining the industry’s ability to comply with those efforts.
‘SPINNING FAT INTO GOLD’
Demand and prices for feedstocks from soybean oil to grease and animal fat is soaring. Used cooking oil is worth 51 cents per pound, up about half from last year’s price, according to pricing service The Jacobsen.
Tallow, made from cattle or sheep fat, sells for 47 cents per pound in Chicago, up more than 30% from a year ago. That’s boosting the fortunes of renderers such as Texas-based Darling Ingredients Inc and meat packers such as Tyson Foods Inc. Darling shares have about doubled in the last six months.
“They’re spinning fat into gold,” said Lonnie James, owner of South Carolina fats and oil brokerage Gersony-Strauss. “The appetite for it is amazing.”
Clean fuels could be a boon for North American refiners, among the pandemic’s hardest-hit businesses as grounded airlines and lockdowns hammered fuel demand. Refiners Valero Energy Corp, PBF Energy Inc and Marathon Petroleum Corp all lost billions in 2020.
Valero’s renewable diesel segment, however, posted a profit, and the company has announced plans to expand output. Marathon is seeking permits to convert a California refinery to produce renewable fuels, while PBF is considering a renewable diesel project at a Louisiana refinery.
The companies are among at least eight North American refineries that have announced plans to produce renewable fuels, including Phillips 66, which is reconfiguring a California refinery to produce 800 million gallons of green fuels annually.
Once new renewable diesel production capacity comes online, feedstocks are likely to become more scarce, said Todd Becker, chief executive of Green Plains Inc, a biorefining company that helps produce feedstocks.
Goldman Sachs estimates that an additional 1 billion gallons of total capacity could be added if not for issues with feedstock availability, permitting and financing.
“Everybody in North America and around the world are all trying to buy low carbon-intensity feedstocks,” said Barry Glotman, chief executive of West Coast Reduction.
His customers include the world’s biggest renewable diesel maker, Finland’s Neste. A spokesperson for Neste said the company sees more than enough feedstock supply to meet current demand and that development of new feedstocks can ensure supply in the future.
SOYBEAN, CANOLA BOOM
Renewable diesel producers are increasingly counting on soybean and canola oil to run new plants.
The U.S. Agriculture Department (USDA) is forecasting record-high soybean demand from domestic processors and exporters this season, largely because of soaring global demand for livestock and poultry feed.
Crushers who produce oil from the crops are also scouring Western Canada for canola, helping to drive prices in February to a record futures high of C$852.10 per tonne. Soybeans reached $14.45 per bushel in the United States last week, the highest level in more than six years.
Rising food prices are a concern if the predicted demand for crops to generate renewable diesel materializes, said USDA Chief Economist Seth Meyer. U.S. renewable diesel production could generate an extra 500 million pounds of demand for soyoil this year, Juan Luciano, chief executive of agricultural commodities trader Archer Daniels Midland Co, said in January. That would represent a 2% year-over-year increase in total consumption.
Greg Heckman, CEO of agribusiness giant Bunge Ltd, in February called the renewable diesel expansion a long-term “structural shift” in demand for edible oils that will further tighten global supplies this year.
By 2023, U.S. soybean oil demand could outstrip U.S. production by up to 8 billion pounds annually if half the proposed new renewable diesel capacity is constructed, according to BMO Capital Markets.
That same year, Canadian refiners and importers will face their first full year complying with new standards to lower the carbon intensity of fuel, accelerating demand for renewable diesel feedstocks, said Ian Thomson, president of industry group Advanced Biofuels Canada.
Manitoba canola grower Clayton Harder said it is hard to envision a vast expansion of canola plantings because farmers need to rotate crops to keep soils healthy. Farmers may instead have to raise yields by improving agronomic practices and sowing better seed varieties, he said.
British Columbia refiner Parkland Corp is hedging its bets on feedstock supplies. The company is securing canola oil through long-term contracts, but also exploring how to use forestry waste such as branches and foliage, said Senior Vice President Ryan Krogmeier.
The competition to find new and sustainable biofuel feedstocks will be fierce, said Randall Stuewe, chief executive at Darling, the largest renderer and collector of waste oils.
“If there is a feedstock war, so be it,” he said.
(Reporting by Rod Nickel in Winnipeg, Stephanie Kelly in New York and Karl Plume in Chicago; editing by David Gaffen, Simon Webb and Brian Thevenot)
UK fishing sector sees more job losses if post-Brexit export troubles not tackled soon
By Maytaal Angel
LONDON (Reuters) – Britain could lose more jobs in its fishing sector if the current delays and increased costs involved in exporting to the EU post-Brexit are not ironed out soon, industry groups told British government officials on Tuesday.
Speaking at an Environment, Food and Rural Affairs (EFRA) select committee inquiry, representatives of Britain’s fishing sector said small to medium-sized enterprises were especially at risk and called on the government to urgently negotiate new export rules with the EU.
“(Even) if we get (export) systems sorted, we will still have cost implications. In the medium term, small companies will stop trade to Europe and it may even be their demise,” said Donna Fordyce, chief executive of Seafood Scotland.
“It’s a real worry. These people can’t see a future.”
Under a Brexit deal reached late last year, British trade with the EU remains free of tariffs and quotas. But the establishment of a full customs border means goods must be checked and paperwork filled in, damaging express delivery systems.
Fresh food sectors like fishing and meat have been particularly hard hit, with export paperwork costs soaring and delivery delays prompting EU buyers to reject British produce or to pay less for it.
Sarah Horsfall, co-chief executive of the Shellfish Association of Great Britain, said some British shellfish companies had already shut their doors, buckling under the pressure of the COVID-19 pandemic, and then Brexit.
She said paperwork costs per consignment have increased by 400-600 pounds. On top of that, companies often need to hire two or three extra staff just to fill in the paperwork, adding to costs.
Another point of contention for the British seafood sector is that EU exporters are currently not facing increased costs or delays in sending goods to Britain because the UK has postponed introducing reciprocal customs checks by three to six months.
“Exporters we deal with are considering relocating to the EU. We have to address this urgently if we want to grow, because at the moment we are at the risk of doing the opposite,” said Martyn Youell, senior manager of fisheries and quotas at fishing company Waterdance.
(Reporting by Maytaal Angel; Editing by Sonya Hepinstall)
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