Economy
Explore 'Make in India', Hong Kong urges its industries
Hong Kong : Even as it promotes Hong Kong as the gateway for Indian companies to the Chinese markets, the Hong Kong Trade Development Council (HKTDC) is promoting India as an alternative manufacturing base for its industries based in China, states a research report.
 
"In recent years, the sustained rise in production costs on the Chinese mainland has eroded the profit margins of many Hong Kong companies with labour-intensive factories located on the Chinese mainland, prompting them to seek alternative production bases elsewhere," the report states.
 
"In a nutshell, India offers many advantages as an alternative production base, along with the added advantage of having a domestic market of great potential," notes the report.
 
Most of the manufacturing units in Hong Kong migrated to China to take advantage of the low costs after the region was handed over to the latter by the British in 1997.
 
Some of the multi-storeyed buildings that once housed garment units are now used as offices or are lying vacant.
 
With manufacturing units shifting base, Hong Kong has turned into a business services hub.
 
According to HKTDC's report, India was the world's second biggest exporter of textile and garment products in 2014, shipping goods worth $36 billion, behind China's exports worth a whopping $399 billion.
 
The report also cites the lower import tariff levied on Indian goods by the US and the European Union (EU).
 
India has been an active player in Asia, securing free trade agreements (FTAs) inside and outside the region. India has also been in talks on an FTA with the EU. 
 
Further, US import tariff rates for Indian yarn-related products range between zero percent and 2.7 percent. The weighted average import tariff rates of the EU and US on non-agricultural products from India are 4.5 percent and 2.5 percent, respectively.
 
On the demographic profile the report states that the Indian median age of 27 is way below China's 37, ensuring a good supply of young workers for many years to come.
 
"As an aside, China recently announced abandonment of its one-child policy in response to the country's ageing population, though the effect would not be appreciable over the short-to-medium term," the report added.
 
According to HKTDC, the Indian wage levels are comparatively lower than what is paid in China. Furthermore, labour productivity in India is going up while that in China has been declining.
 
The report also cites the presence of industrial estates with plug and play facilities in India for Hong Kong manufacturers to relocate their factories rather than getting bogged down in land acquisition and other issues.
 
The HKTDC report cites the huge domestic market available in India for Hong Kong manufacturers apart from the country being an alternative production site for overseas markets.
 
Meanwhile businessmen in Hong Kong told IANS that the region is the best route to do business with the Chinese.
 
"We know the people who have shifted operations out of Hong Kong to China. It is better for Indian companies to set up an office here than landing directly in China," Noordin A. Ebrahim, director of Masterful Ltd, told IANS.
 
Referring to credit rating agency Moody's Investors Service to cut Hong Kong's long term debt outlook due to its close link to China, Ebrahim said: "I feel it is a political judgement rather than financial."
 
Ebrahim is of the view that China would not do anything to shake the confidence of the Hong Kong business community and would like to see that peace continued to prevail in the former British colony.
 
Hong Kong has transparent and rules based systems, very low taxes and knowledgeable work force, he added.
 
"Knowledge of the local market is important while branding products for China and other markets. Hong Kong-based brand consultants would provide the same for Indian companies," David Lo, chairman, Hong Kong Designers Association, told IANS.
 
"The Closer Economic Partnership Arrangement (CEPA) between the mainland (China) and Hong Kong would result in liberalisation of trade in service between the two regions from June 2016," Yvonne So, director, corporate communication and marketing at HKTDC, told IANS.
 
"Overseas companies can take advantage of CEPA by outsourcing to, or partnering with, a CEPA-qualified manufacturer or services provider in Hong Kong," she added.
 
As for the human resources available, she cited Hong Kong's nine major universities having more than 75,000 full-time undergraduate students and 8,000 taught and research full-time post-graduates.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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'Emotionally-connected' TV shows best platform for ads: Twitter
New York : If you want your ads to reach more viewers and stay in their memory for a longer period, choose TV serials that have an emotional connect with them, a Twitter-sponsored study has revealed.
 
The study, conducted with ad agency Starcom and startup Canvs, included nearly 20 prime time programmes in which Starcom clients ran TV ads, variety.com reported. 
 
The findings showed that TV viewers who were emotionally connected to a show are more likely to remember the ads they saw.
 
“We’ve long believed that viewers respond differently to commercials depending on how they feel about what they’re watching,” Heather O’Shea, Twitter’s head of global agency research and data strategy, said in a blog post.
 
When it comes to getting a pulse on people’s emotional reactions during live TV, now we know that Twitter can drive even stronger results for brands, O’Shea added. 
 
Among the viewers who posted on Twitter with emotional terms like “love” and “excited,” 41 percent recalled ads in the programme.
 
It was three times that of users whose tweets about a show were neutral. 
 
Among emotional tweeters, 61 percent said they were likely to purchase from the brands advertised, the report added.
 
According to Twitter, TV ad campaigns that have “promoted tweets” feature synchronised with TV broadcasts has 9 percent lift in ad recall compared with campaigns that did not.
 
The findings showed that people who used Twitter while watching a TV show were 62 percent more likely to recall the brands which advertised during the programme.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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Reliance Life gets nod for $350 mn more equity from Nippon Life
Mumbai : The Foreign Investment Promotion Board has granted approval to Japan's Nippon Life Insurance to increase its stake in Anil Ambani-led Reliance Life Insurance (RLI) to 49 percent, which will peg the valuation of the Indian company at $1.5 billion.
 
Nippon Life will be investing an aggregate value of Rs.2,265 crore ($348 million) to acquire an additional 23 percent stake in Reliance Life to reach a 49 percent stake, a statement by the companies said. 
 
"In line with the new shareholding structure, the name of the company will also be changed to Reliance Nippon Life Insurance Company, post increase in stake," the statement added. 
 
"The transaction pegs Reliance Life Insurance's valuation at approximately Rs.10,000 crore ($1.5 billion), amongst the highest valuation for any Life Insurance company in the country."
 
Once the transaction goes through, Nippon Life would have invested a total of Rs.8,630 crore ($1.3 billion) for acquiring the 49 percent each in Reliance Life Insurance and Reliance Capital Asset Management.
 
Nippon Life is an over-125 years old insurer and a Global Fortune 500 company that manages over $520 billion in assets -- amongst the largest total assets in the world for any life insurer.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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