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Web based App CMRS for better crop and Nutrient management released for Bihar farmers launched
Jun 29,2016

The Union Agriculture & Farmers Welfare Minister, Shri Radha Mohan Singh today launched Crop Manager for Rice-based Systems (CMRS) - a web based App for better crop and Nutrient management released for Bihar farmers in a program organised at ICAR-RCER in Patna.

While launching the App, the Union Minister congratulated the scientists of different institutes involved in development of this app. The App will be a part of Digital India program, already launched by the Honble Prime Minister, Shri Narendra Modi and will be linked with Soil Health scheme for bringing access to new technologies to rural India.

Crop Manager for Rice-based Systems (CMRS) is a web-based App which can be used with computer, mobile and tablet and aims to increase farmers net income and sustain the productivity for rice-based cropping systems in Bihar, India. CMRS provides irrigated and rainfed farmers with rice-based cropping systems in Bihar with a crop and nutrient management guideline customized to the needs of an individual farmer. CMRS uses a farmers answers to questions on farming practices to automatically generate a rice, wheat, or rabi maize management guideline.

CMRS is designed for use by extension workers, crop advisers, input providers, and providers of services who interview a farmer using a personal computer, smartphone, or tablet. CMRS was adapted, evaluated, and verified in Bihar through collaboration of IRRI with the Indian Council for Agricultural Research- RCER (ICAR); Bihar Agricultural University (BAU), Catholic Relief Services (CRS), and Rajendra Agricultural University (RAU) and CIMMYT.

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States requested to lift Tur and Urad from buffer stock to sell at Rs 120/kg
Jun 28,2016

Procurement of Rabi pulses reaches to 68,000 MT Procurement of Rabi pulses has reached to 68,000 MT as on June 27, 2016. Thus together with earlier procurement of 51,000 MT of Kharif, total domestic procurement of pulses by government agencies has reached to 1,19,000 MT. Besides this 14,321 MT pulses have been imported by the government agencies against the total contracted quantity of 46,000 MT.

In Delhi, outlets of Kendriya Bhandar and Mother Dairy/ Safal have sold 1058 quintals of Tur and 345 quintals of Urad so far at the rate Rs 120/kg as on 27 June 2016. This was informed in an inter-ministerial review meeting chaired by Secretary, Department of Consumer Affairs, Shri Hem Pande here today. The meeting reviewed the prices of essential commodities and discussed measures to ensure availability these commodities at reasonable prices.

Shri Pande reviewed lifting and distribution of the pulses allocated from the buffer stock to the states. It was decided that the states will be requested again to expedite lifting of pulses - Tur and Urad for distribution at Rs 120 / kg.

The meeting was attended by senior officials of Department of Food, Ministry of Agriculture, Department of Economic Affairs, Department of Revenue, Department of Commerce, Ministry of Statistics and Programme Implementation, MMTC and NAFED.

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RFID Based Access Control System Inaugurated at Cochin Port
Jun 28,2016

Dr. K. N. Raghavan, Commissioner of Customs, Cochin inaugurated a RFID (Radio Frequency Identification System) newly installed at Ernakulam Wharf of Cochin Port. The RFID is an access control system on digital platform for regulating movement of vehicles, cargo and people into the sensitive wharf area. The system dispenses away with manual checkings and reduces the waiting time at the wharf gates.

Presently, access control of vehicles and persons are done through a manual gate pass system.

The Port Users have registered in the system and have been given RFID tags. These are pasted on the wind shield glass and access is granted when the sensor of the system captures and recognizes the vehicle at the gates. The system works on ultra-high frequency signals and every entry and exit of all vehicles are stored in a system of computers, which enables long period of storage with easy retrieval facility of historical data at any point of time.

The introduction of RFID is one of the key steps in the modernization plan of Indias seaports, formulated by the Government of India, for Port Sector security and efficiency enhancement.

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DADF Secretary Discuss State Action Plan for National Livestock Mission (NLM) with North East Region Officials
Jun 28,2016

The Secretary (DADF), Shri Devendra Chaudhary held a meeting with the Principal Secretaries/Secretaries/State officials of North East States to discuss State Action Plan for National Livestock Mission (NLM). The agenda of the meeting was to streamline and give the necessary drive and focus on the specific need of the States in NER and the necessary inclusive development.

The Secretary, DADF discussed State Action Plan for NLM during this year so that the outcome of such activities may enhance the income of farmers, Activities more specific to the States of the NER such as piggery development, backyard poultry and livestock insurance were the main focus in the meeting.

As far as National Livestock Mission (NLM) is concerned, a total amount of Rs.4300 lakh has been allocated to the North Easter States for the year 2016-17.

Nagaland, Meghalaya and Mizoram have been directed to give their requirement for 100 piglets of superior germ plasm for each of their pig breeding farms in the State to National Research Centre on Pig, Rani, Guwahati.

The Secretary, DADF directed the States to come up with a plan for genetic up gradation for sheep, goat and pig.

Shri Chaudhary also emphasized on need of deworming of existing population of small ruminants and pig population of the States. Sikkim was allocated Rs.30 lakh, Rs.40 lakh for Tripura, Rs.100 lakh for Nagaland and Rs.100 lakh for Meghalaya to deworm their sheep, goat and pig population.

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Rs 3700 Crores Require to Implement National Action Plan for Bovine Breeding: Shri Devendra Chaudhary, DADF Secretary
Jun 28,2016

The Secretary for Department of Animal Husbandry, Dairying and Fisheries, Ministry of Agriculture, Shri Devendra Chaudhary discussed the National Action Plan for bovine breeding with the all States at length from 20 to 23 and 27th June 2016 in New Delhi. Shri Chaudhary emphasized the State officials to enhance milk production and productivity of dairy animals in order to double farmers income. The National Action Plan (NAP) was discussed with State officials at length along with increase in population of indigenous cattle. The Secretary, DADF urged the States to frame strategy to enhance productivity of indigenous breeds as indigenous cattle are managed by poor farmers of the country. All the States agreed to implement National Action Plan. State wise physical and financial targets for different category of dairy animals including indigenous cattle were also discussed. The NAP envisages to enhance productivity of indigenous cattle to 5 kg/per animal/day and AI coverage from the present level of 25% to 70% by 2019-20. It was also mentioned that an amount of Rs 3700 crores will be required by States to implement this National Action Plan.

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In order to double farmers income there is a need to increase milk production to 300 MMT by 2019-20 - Secretary, DADF
Jun 28,2016

The Secretary for Department of Animal Husbandry, Dairying and Fisheries, Ministry of Agriculture, Shri Devendra Chaudhary visited the facilities on 25th June 2016 of ICAR-NDRI and NBAGR, Karnal (Haryana) and interacted with the scientists. On the sideline of the visits Shri Chaudhary also had interactive discussion on n++National Bovine Genomic Centre for Indigenous Breedsn++ and National Action Plan on bovine breeding. The Secretary stressed the scientists to work towards enhancement of productivity in indigenous breeds of cattle, as more than 80% of indigenous animals are with small & marginal farmers and landless labours yielding 3kgs of milk per day. He mentioned that in order to double farmers income there is a need to increase milk production to 300 MMT by 2019-20. The Secretary, DADF also visited Central Herd Registration Scheme milk recording Centre at Gannaur of Sonipat District and emphasized the need for field performance recording and to evolve sustainable method for milk recording.

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Secretary, DADF, Reviews Preparations for the National Action Plan 2020 for Fisheries in North-East States
Jun 28,2016

The Secretary for Department of Animal Husbandry, Dairying and Fisheries, Ministry of Agriculture, Shri Devendra Chaudhary yesterday reviewed the preparations for the National Action Plan 2020 for fisheries from all the North Eastern Region States. The states of Assam, Mizoram, Sikkim, Tripura and Manipur attended the meeting and provided the required information with respect to their states, toward the finalization of the National Action Plan. While taking note of the requirements of each of the states, the Secretary, DADF also issued directions based on the unique requirements of each of the state. Sikkim state was asked to focus on cold water fisheries, especially Trout, and Manipur and Assam states were directed to make special investments on the development of wetlands. Further, the state of Mizoram was asked to pick up Cage culture technology for their lone reservoir, with an area of 4300 ha. It is hoped that the special attention being given to the North Eastern region states will have a major impact with respect to the production of fresh water fisheries and will reduce their dependence upon the imports of fish in due course of time.

An amount of Rs. 4.00 crore has been proposed to be earmarked to these North Eastern States for construction of fishermen houses and contribution towards Saving-cum- Relief scheme. An amount of Rs. 41.00 crore has been earmarked for development of aquaculture in ponds and tanks, seed stocking in reservoirs and development of wet lands in Assam and Manipur depending upon the availability of resources. Similarly, Rs. 4.65 crore was proposed for development of cold water fisheries in Sikkim.

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New Stevedoring and Shore Handling Policy in Place for all Major Ports from 31st July, 2016
Jun 28,2016

Ministry of Shipping will implement a new Stevedoring and Shore Handling Policy for all Major Ports from 31st July, 2016.

The existing Stevedoring Agents will have to switch over to the new Stevedoring and Shore Handling Scheme from that date and charge the ceiling tariff rate fixed. If they do not switch over to the new scheme, the licence shall be terminated by the Port Trusts by giving due notice as envisaged in the Regulations. The Ports shall ensure that migration to the new Stevedores & Shore Handling Scheme is done by following the statutory provisions under the existing Regulations.

All existing contracts applicable to Stevedoring and Shore Handling operations would be allowed exemption till the date of expiry of the contract or 31st July, 2017, whichever date is earlier. As an example, Haldia Dock Complex had introduced Stevedoring licences for two years from April, 2015 and is valid till March, 2017 through an auction process. Therefore, the new Stevedoring and Shore Handling Scheme will be made applicable after expiry of the existing Scheme i.e. from April, 2017.

Stevedoring and Shore Handling Charges

TAMP shall notify the normative tariff for Stevedoring and Shore Handling activities for the Major Ports based on a set of Guidelines to be issued to TAMP. This tariff shall be ceiling tariff. With regard to Kamarajar Port, the Board of Directors may fix the same. In case of any change in Role for TAMP in future, Boards of Major Ports will fix and notify the Rates based on the performance norms in the Major Port as per Berthing Policy Guidelines. This will also apply to Mumbai Port and Haldia where stevedoring is carried out by the Ports.

All port customers will be notified on the ceiling tariffs set for Stevedoring and Shore Handling activities. The tariff will be mandatorily displayed on the Port website.

The port will appoint a nodal officer responsible for monitoring of Stevedoring and Shore Handling tariffs. The officer will be responsible for handling all complaints on violation of Stevedoring and Shore Handling ceiling tariff.

The Port Trusts should be liberal in issuing licenses to Stevedoring and Shore Handling agents. All eligible agents would be issued licences for Stevedoring and Shore Handling operations to ensure maximum competition. As competition increases, the cost of transaction to the trade will decrease and the quality of services will also improve.

The Port Trusts may charge a royalty as the licence fee for the Stevedoring and Shore-handling licences. The Port Trust may fix a per Metric Tonne royalty rate from all agents. No discrimination will be made among the Stevedoring and Shore-handling agents on the royalty licence fee.

License for Stevedores & Shore Handling Agents

Port Trusts shall frame & notify regulations for licensing of Stevedoring and Shore Handling Agents instead of only Stevedores as at present. The Major Port Trusts shall host the Stevedoring and Shore Handling regulations in their web site and any eligible firm which fulfils the eligibility criteria can apply for license at any time on-line along with requisite documents. The stevedoring and shore handling licenses shall be issued by the ports to the firms fulfilling the criteria.

It shall be a Company registered under Companies Act or a partnership firm or any other legal entity. It shall deposit security amount of at least Rs. 5 lakhs to meet any contingency which shall be refunded without interest after adjusting the claims, if any, when the licensee ceases to operate.

The Stevedoring and Shore Handling agent shall undertake to provide equipment/gear required for both the operations as specified by the Port Trust Board.

The Stevedoring and Shore Handling agents shall undertake to employ at least 6 supervisory personnel with minimum two years of cargo handling/ stowage experience for undertaking both the functions. Their profiles have to be enclosed along with the application.

The fee for issue of license shall be on payment of a minimum application fee of Rs. 50,000, which may be revised from time to time by the Port Trust Board.

Major Port Trusts have to ensure that adequate competition prevails in Stevedoring and Shore Handling activities in their ports.

Performance criteria

Productivity norms for the Stevedore and Shore Handling agents shall be calculated on the basis of Berthing Policy by all Ports. Performance based penalty and incentives shall be enforced in accordance with the Berthing Policy. All Port trusts shall re-assess the penalty bands and/or incentive bands in the frequency as prescribed by the Berthing Policy.

Daily performance report in the prescribed format shall be submitted by the Stevedoring & Shore Handling agent to the Traffic Department online. Performance of the agent in terms of productivity achieved will be reviewed by the Port Chairman every month. The monthly performance summary capturing productivity achieved by the respective agents will be published on the Port website to ensure transparency to the customers.

Licenses of agents failing to meet productivity norms for an average over a period of 3 months can be revoked by the Port Authority. The personnel deployed in Stevedoring & Shore Handling activities shall be trained in modern methods of cargo handling for improving the productivity, efficiency and safety.

Background

Stevedoring includes loading and unloading and stowage of cargo in any form on board the vessels in Ports. Shore Handling includes arranging and receiving the cargo to/from the hook point, inter modal transport from wharf to stackyard and vice-versa and also receiving and delivering of cargo from/to wagons/trucks.

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326.38 LMT wheat in the Central Pool against the PDS requirement of 240 LMT
Jun 28,2016

FCI maintains adequate stock of foodgrains to deal with fluctuations in productions and to meet unforeseen natural calamities. A stocking norm prescribing the minimum quantity of Rice and Wheat that should be available in Central Pool at the beginning of each quarter to take care of operational requirements and above fluctuations, has also been approved by the Government of India. As per stocking norms as on 1st April, FCI has to maintain wheat stocks of 74.60 Lakh MT(LMT), whereas 145.38 LMT wheat stocks were available in central pool as on 01.04.2016. During the current wheat procurement seasons, about 230 LMT wheat have been procured.

The wheat stock in the Central Pool as on 1st June 2016 was 326.38 LMT. The annual requirement under NFSA is around 240 LMT.

FCI also releases wheat at pre-determined prices in the open market from time to time to enhance the supply of wheat especially during the lean season, to moderate the open market prices. The average sale under OMSS(D) has been around 50-55 LMT. FCI is therefore having sufficient wheat stocks to meet out the requirement under National Food Security Act/Other Welfare Schemes and also to meet out demand of wheat under Open Marker Sale Scheme. In the current year Private traders have procured wheat aggressively estimated to by 60-65 LMT. The demand under OMSS(D) is therefore expected to be lower. The wheat stocks position in the country is thus comfortable.

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With Indias exemplary non-proliferation record, membership of MTCR will facilitate access to niche technologies to Indian Industry
Jun 28,2016

FICCI welcomes Indias membership to the Missile Technology Control Regime (MTCR), one of the four multilateral export controls regimes that it is committed to enter as part of its international obligations. Indias missile technologies have been home grown and developed over past three decades resulting into some of the benchmark weapon systems.

n++With Indias exemplary non-proliferation record, membership of MTCR will facilitate access to niche technologies to Indian Industry in sensitive sectors like defence, aerospace and nuclear which will earlier being denied to be transferred to India. This inclusion also augurs well with Indias position as an important Player in the world order and fitting an emerging economic superpowern++, said Dr. A Didar Singh, secretary general FICCI.

n++As Indian industry we have opportunity to rise to the occasion and put in place checks and balances compliant with the obligations that this regime entails. FICCI is committed to Capacity building especially in MSMEs to be compliant with this export control ecosystemn++, Dr. Singh added.

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Enhanced Financial Powers to different Ministries
Jun 28,2016

Government of India has decided to revise the financial limits for appraisal and approval of Non-Plan Schemes/Projects by competent authorities. As per the revised delegation, the Committee on Non-Plan Expenditure (CNE), which serves as an appraisal forum for all non-plan proposals of Central Government Ministries/Departments, will now appraise proposals involving expenditure of Rs.300 crore and above. The earlier limit for this was Rs.75 crore. Non-plan Schemes/projects of less than Rs.300 crore can now be appraised by Ministry / Standing Finance Committee of the Ministry concerned.

The financial power of the Minister-in-charge of the administrative Ministry for approval of the Non-Plan schemes/projects has also been enhanced and the schemes/project costing less than Rs.500 crore can now be approved at his/her level. Earlier, the Minister-in-charge could approve projects costing less than Rs.150 crore. Finance Minister shall be competent financial authority for approving scheme/projects having financial implications of Rs.500 crore and above and upto Rs.1000 crore.

Proposal having financial limits of Rs.1000 crore and above shall require approval of the Cabinet/Cabinet Committee on Economic Affairs. Concurrently, financial limits regarding appraisal and approval of increase in cost estimates have also been revised. Increase in cost upto 20% of the firmed up cost estimates can now be appraised by the Financial Adviser and approved by Secretary of the administrative Department, if the absolute cost escalation is upto Rs.75 crore, and by the Administrative Minister-in-charge if absolute cost escalation is above this.

With this enhancement of financial powers, the financial limits for appraisal and approval of plan and non-plan schemes/projects of Central Government Ministries and Departments have been brought almost at par. This is expected to expedite appraisal and approval process in the Central Government Ministries/Departments.

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FSSAI Joins Hands with CHIFSS to Drive Food Safety
Jun 28,2016

FSSAI (Food Safety and Standards Authority of India) joined hands with CHIFSS (CII-HUL Initiative on Food Safety Sciences) a partnership initiative between Indias premier business association CII (Confederation of Indian Industry) and FMCG giant HUL (Hindustan Unilever Limited) with the purpose of driving science based food safety in order to further strengthen consumer safety and enable a science based innovation environment.

At the Launch of the CII-HUL Initiative on Food Safety Sciences (CHIFSS) ,Mr Pawan Agarwal, CEO , FSSAI signed an MOU with CHIFSS .

FSSAI has already paved the way for a world class regulatory system with its work on harmonization of Indian Standards with Codex and is now focusing on capacity building to develop an inclusive ecosystem through a participative approach involving all stakeholders.

n++We are happy to sign the MoU with CHIFSS,n++ said Mr Pawan Agarwal, CEO, FSSAI on the occasion of the launch. n++This collaborative initiative will drive and disseminate food safety on science based risk analysis in India and work towards improving food safety through fact and data based technical briefs , food safety plan guidance documents and on-line training programs,n++ he added.

Ms. Anuradha Prasad, Joint Secretary, Ministry of food processing industries, thanked FSSAI for largely resolving the issues being faced by Food Processing Industry at the launch ceremony. She highlighted it as a positive move in a short span of six to eight months. In her address she pointed n++it is a right time to move beyond compliance and incorporate best international practices on food safety to create and ensure safe foodn++.

Mr Chandrajit Banerjee in his welcome remarks mentioned about CIIs extensive outreach and service portfolio on Food Safety and Quality for more than a decade, covering Awareness Campaigns, Collaborative Certificate courses for Food Professionals, Workshops on Risk Assessments and Standards formulation. n++We are delighted to launch the CII-HUL Initiative on Food Safety Sciences for driving Science behind Food Safety which will work in a partnership mode with FSSAI, eminent scientists, academia and key opinion formers. The overall purpose of the initiative is to contribute to a holistic growth of the Indian food sector while ensuring safe food for all,n++ stated Mr Chandrajit Banerjee, DG CII.

Mr. Sanjiv Mehta, in his address, stressed the need for a globally benchmarked national food safety agenda, founded on science based food safety principles. He highlighted the expertise of Unilever in food safety sciences and the fact that Unilever experts are globally recognized thought leaders in the areas of food microbiology and toxicology are actively working with academics and scientific institutions globally on food safety matters. He also reiterated HULs commitment towards partnering with all stakeholders to enhance the science based food safety in India. He said, n++We are delighted to see CHIFSS fructify into a reality. The pioneering partnership between CHIFSS and FSSAI will further strengthen industry-government collaboration to promote science based food safety which stimulates innovation while ensuring consumer safety.n++

As the first outcome of CHIFSS, the Food Safety Management System Guidance Document for Ice Creams and Frozen Desserts was also released alongside the launch of the Website. A Panel discussion on Driving Food Safety through Science Based Principles followed soon after the Launch ceremony.

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CII Issues 6-Point Action plan for Apparel, Made-ups & Textile Industry; Potential to create 50 million jobs, 3x Growth
Jun 28,2016

Moving an entire industry and creating millions of jobs seems a herculean task, but with bold Labour reforms, implementation of GST, robust export infrastructure coupled with innovation & technology, Indian Textile and Apparel industry has the potential to fundamentally change its trajectory, create over 50 million jobs, bring social transformation and gain global dominance. These are some of the early conclusions of the a study on the Indian Apparel, Made - ups & Textile Industry commissioned by the Confederation of Indian Industry (CII) to the Boston Consulting Group (BCG) to identify the key catalysts that will enable breakout growth.

According to CII, global trends in the apparel, made-ups and textile industry today are ominous and opportune. With an increase in wages and the Yuan gaining strength, industry is shifting its base away from China, creating a potential market of USD 280+ billion for other countries to capture. The shift is already happening in the apparel sector, large shifts are expected in fabric and yarn sourcing as well. Though Bangladesh and Vietnam are the current frontrunners, emergence of hubs in Africa (e.g. Ethiopia) and a strong resurgence seen for manufacturing in the US, the future landscape could be dramatically different.

Capturing this opportunity can bring immense social and economic benefits. The sector is the largest industrial employer of women in the country and can provide quick employability to a large mass of workers. If the industry achieves breakout growth, we estimate another 50 million jobs to be created by 2025 ~ 35-40 million of which will be employing women. Potential economic benefits are sizeable as well. The Study estimates that the industry can triple in size over the next 10 years, get USD 150 billion annually in foreign exchange, and spur the apparel, made-ups and textile industry to reach USD 300 billion by 2025. The domestic market will also grow at least 2.5 times to become around 150 billion dollars in size.

According to Mr Chandrajit Banerjee, Director General, CII, n++India is uniquely positioned to capitalise on this opportunity. We are the only country in the world other than China to have the entire value chain from fibre to fashion, both in cotton and synthetics, an abundant and young labour force, a vibrant domestic market and a good starting point in exports (2nd largest exporter of textiles, apparel and made-ups in the world)n++.

The study notes that shifts in the global apparel, made-ups and textile industry are going to be shaped by four major factors a) Cost competitiveness, especially in labour / wage structures and energy structures per unit of output b) Ease of market access (both in terms of tariffs/duties and time to market) c) Ease of doing business and d) Technical innovations.

The CII 6-point agenda identifies the following game-changers for the Indian Apparel, Made-ups and Textiles industry.

Firstly, build scale, as the industry is currently highly fragmented and lacks scale. Being highly labour intensive, introduce flexible labour laws; job linked support schemes, innovative hub and spoke models for apparel / textile parks to employ labour in hinterlands and introduce PPP models for Industry to provide scale and create jobs.

Secondly, bridge the operating cost gap, especially on synthetics. Entrepreneurs need to aggressively drive up productivity by investing in world class facilities, process improvements and build a culture of manufacturing excellence. Simplified tax structures and neutral implementation of GST for both cotton and synthetic products will give the much required boost to the industry.

Thirdly, Infrastructure, especially at ports, import facilities and clearance procedures should be streamlined to cut turnaround times. Signing FTAs with major markets like the European Union can equalise market access positions with key competitors like Bangladesh.

Fourthly, increased investments in technology, especially processing and technical textiles either through capital subsidy or technology partnerships. The A-TUFS released in December 2015 has taken welcome steps in this respect.

Fifthly, to actualise Make-in-India movement, Government can create a comprehensive umbrella of support schemes under the Make-in-India banner. Entrepreneurs need to advertise the made-in-India aspect aggressively, over-invest in quality and make their products worthy of putting up Proudly Indian labels.

And lastly, Indian entrepreneurs need to invest both financial and human resources on technology and innovation to address the constantly evolving markets. Investments are required in technical textiles, processing, and apparel making in particular. India needs to create its own silicon-valleys for technical textiles, with a full ecosystem of investors, start-ups, production facilities and ultra-fast clearances. Ease of doing business is equally critical for innovation.

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Brexit fall-out: India must build firewalls by domestic reforms, says ASSOCHAM
Jun 28,2016

Britains exit from the European Union (EU), as decided by its people, has come about as a shocker not only for global financial markets but also the political leaders across the world, throwing a huge amount of uncertainty as to which way the economic winds would blow, ASSOCHAM Secretary General Mr D S Rawat said.

n++India is relatively safe thanks to its macroeconomic stability reflected by low current account deficit, comfortable foreign exchange reserves and improved GDP prospects with advancing Monsoon. However, given the heightened global risks emerging from todays event, it is time India further buffeted its domestic firewall by moving ahead with the GST Bill and other important reforms so that we remain as the most credible destination for global funds, the ASSOCHAM Secretary General said.

He said, however, since India has a huge corporate investment in the UK economy, the Indian firms with manufacturing or other facilities in Britain will have to re-align their business plans, depending on the terms of negotiations, hopefully for smooth exit of UK from the European Union.

Besides, India must also rework its trade and investment strategy for the EU in the changed circumstances and position itself as the best partner to both UK and the rest of Europe, not at the cost of the other.

In the short term, it is time to be watchful particularly with respect to the currency markets which RBI is expected to be watching proactively. As for the equity and debt markets, the best defence for India would be to move fast on domestic reforms to be able to provide a safe haven for the panicky global investors, Mr Rawat said.

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Moodys: Consolidation of Indian banking system presents greater risks than benefits
Jun 28,2016

Moodys Investors Service says that the Indian Governments (Baa3 positive) proposal to consolidate the countrys public sector banks (PSBs) creates risks that -- in the current weak economic environment -- could offset the potential long-term benefits.

Indias banking system has witnessed an increase in stressed assets since 2012, with the result that no PSB currently has the financial strength to assume a consolidator role without risking its own credit standing post-merger, says Alka Anbarasu, a Moodys Vice President and Senior Analyst.

Barring significant government support to boost the banks capitalization, we believe the risks arising from the potential consolidation currently outweigh the potential longer-term benefits, adds Anbarasu.

The consolidation of Indian PSBs is gaining policy momentum, says Moodys, as the government aims to strengthen the banking system. In his budget speech for the fiscal year ending March 2017 (FY2017), the finance minister stated that a road map was being formulated and an expert committee would be constituted.

In line with this trend, the State Bank of India (SBI, Baa3 positive, ba1) -- the countrys largest PSB -- in May announced that it will merge with six banks, including five associate banks.

From a credit perspective, industry consolidation would strengthen the banks bargaining power, help save costs and improve supervision and corporate governance across the banking system.

These potential benefits, however, are outweighed by multiple downside risks, says Moodys.

In particular, the banks weakened metrics since 2012 and weak performance mean that many have difficulties meeting minimum regulatory requirements without regular capital injections from the government. As a result, few public sector banks have the excess capital required to acquire meaningfully sized peers.

Adding to this financial pressure, all listed PSBs are trading at a significant discount to their book value, limiting their ability to attract external capital to support acquisitions.

Therefore, Moodys believes government support will be a crucial driver of the credit outcome of potential mergers, particularly in the form of the equity capital required to shore up capital buffers.

Finally, Moodys also sees considerable challenges from potential opposition from employee unions, which could hamper merger efforts and drive up costs. For example, SBI estimates that its merger with the associate banks will cost up to INR30 million due to differences in employee pension schemes.

The Indian governments ultimate aim is to reduce the number of PSBs to about 8-10 from the current 27.

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