A looming crisis

The IMF has warned that America and Europe could face an explosion of social unrest because of the job crisis.

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US trade report calls for increasing exports to India

Washington: A US government report today said the Obama administration is trying to resolve key bilateral trade irritants with India so that it can significantly increase American exports to the country, reports PTI.

The report, which has been submitted to US president Barack Obama said India, China and Brazil are large, high-growth markets that offer American exporters tremendous opportunities.

Mr Obama is slated to visit India in November.

US is working on plans to double exports within five years and the report outlines ways in which the government can help American businesses win more foreign government contracts, find buyers worldwide and receive more export financing.

The report, on the National Export Initiative (NEI), has been developed by the Export Promotion Cabinet which includes the secretaries of commerce, state, treasury, agriculture and labour as well as heads of all the government trade agencies.

"In India...the United States is addressing key bilateral trade irritants and developing cooperative initiatives - especially relating to innovation, services, and market access for industrial, consumer, and agricultural goods," it said.

The report added, "In India, priority sectors include energy (renewable, energy efficiency, clean coal, and nuclear); defence and homeland security; civil aviation; health care; consumer goods; franchising; and education."

It provides an overview of the progress of the NEI and lays out a plan for reaching the president's goals of doubling US exports in five years to support several million new jobs.

"As American consumers spend a little less and save a little more, it has never been more important to connect US businesses to the 95% of the world's consumers who live outside our borders," commerce secretary Gary Locke said.

He added, "Helping American companies sell more abroad will create jobs and boost our economy. This report is a blueprint for doing just that."

On India, China and Brazil, the report said that these three large, advanced developing countries have experienced rapid gross domestic product (GDP) growth rates and have rebounded most quickly from the global economic crisis.

China continues to register 9%-10% annual economic growth. India's growth is expected to move from 6%-7% between 2008 and 2009, and 8%-9% between 2010 and 2011. Brazil's projected growth has been revised upward to over 7% for 2010.


Govt clears 11 new SEZ proposals

New Delhi: The government today cleared 11 new proposals to set up special economic zones, including those of Infosys and Wipro, reports PTI.

In its meeting here, the inter-ministerial Board of Approval (BoA) also approved India's largest stainless steel producer Jindal Stainless Ltd's (JSL) proposal to surrender its sector-specific SEZ in Orissa, commerce ministry additional secretary D K Mittal told PTI.

The board, headed by commerce secretary Rahul Khullar, also gave the nod to realty major Raheja Universal Ltd's request to surrender its SEZ in Maharashtra, Mr Mittal said.

Infosys Technologies' IT SEZ would come up in an area of 24.4 hectares in Karnataka, while Wipro Ltd got approval to set up two IT/ITeS tax-free enclaves over 19.4 and 29.9 hectares in the state, Mr Mittal added.

The BoA also gave the green signal to Jawaharlal Nehru Port Trust's port-based multi-product SEZ in Mumbai.

The Centre has also given additional time to 37 SEZ developers, including Wipro, Mahindra and Mahindra and Ansal SEZ Projects, to execute their projects, he said.

The BoA, however deferred a decision on formulation of norms for SEZ units engaged in recycling of plastic. At present, there is no specific provision in the SEZ Act for such units.

While the tax-free enclaves have emerged as major sources for attracting investment and increasing exports, entrepreneurs have expressed serious concerns over the DTC Bill introduced in the Lok Sabha last month, saying the proposed tax provisions would adversely impact employment and investment in SEZs.

The Export Promotion Council for EoUs and SEZs (EPCES) said that by altering the SEZ Act through the proposed Direct Taxes Code (DTC), the government is sending the wrong message to investors.

The Bill has proposed that only SEZs notified on or before 31 March, 2012, will get tax benefits. Furthermore, only those SEZ units that commence commercial operations by March, 2014, shall be allowed the profit-linked deductions permitted under the Income Tax Act, 1961.

Direct employment in SEZs has gone beyond 5.5 lakh people and investments have crossed Rs 1.66 lakh crore.

Exports from 114 operational SEZs in the last fiscal were valued at Rs2.20 lakh crore.


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