A broad ranging discussion I had with the Ambassador at his office in Buenos Aires last week.
India and Uruguay on Sep 8, 2011 signed a Double Taxation Avoidance Agreement that would help boost the flow of trade, investment and technology between the two countries. The agreement will provide tax stability to the residents of India and Uruguay and facilitate mutual economic cooperation as well as stimulate the flow of investment, technology and services between the two countries, an official statement said.
The deal is aimed to ensure avoidance of double taxation and prevention of fiscal evasion with respect to taxes on income and capital.
According to the terms of the agreement, business profits will be taxable in the source country if the activities of an enterprise constitute a permanent establishment in that country. Profits of construction, assembly or installation projects will be taxed in the country of source if the project continues in that country for more than six months, while the profits derived by an enterprise from the operation of ships or aircraft in international traffic will be taxable in the country of residence of the enterprise. Capital gains from the sale of shares will be taxable in the country of source and tax credit will be given in the country of residence.
Across the developing world, women are increasingly outperforming men in the tertiary education system: in Brazil, 60 percent of college graduates are female.
Educated and ambitious, these women are determined to put their credentials to work. Over 80 percent of women in India aspire to top jobs; in Brazil the figure is over 70 percent. In the United States by comparison, a mere 36 percent of highly qualified women are shooting for top jobs.
Such stratospheric levels of ambition are sustained, in part, by the absence of childcare issues. Working mothers in the BRIC nationsare able to think big and aim high because they have more shoulders to lean on than their American and European peers. Between hands-on extended family, inexpensive domestic help and an increasingly wide range of daycare options, professional women in these geographies are not sidelined by motherhood.
Discrimination is an ongoing issue – in both local and global companies. Gender bias continues to limit women’s careers. Problems of bias are severe enough to make nearly half of women in India, China and Brazil (55, 48 and 40 percent, respectively) consider quitting.
Resource nationalism, which is seen as the number-one threat to the mining industry, is not only limited to Africa, with at least 25 countries globally raising the issue in some form, Melbourne-based law firm Gilbert Tobin said on Friday.
Some of the countries said to be looking at options of nationalisition included China, India, Australia, Canada, the US, Brazil, Peru and Chile.
The mining sector was seen an easy target for governments looking to retain or gain wealth, as it was thought to be highly profitable. “The attraction of the mining industry to a state is that simplistically, the industry appears to be highly profitable due to the high commodity prices which are repeatedly headlined.” while some individual companies posted extraordinary profits, the industry as a whole was experiencing significant cost pressures despite the high commodity prices. “The State should not be seduced by the performance of these companies, as they do not represent the endeavours of the industry as a whole.”
He said that it was often as a result of miscommunication that governments operated under a false impression regarding the profitability of the resources sector. Examples of nationalisation were not limited to the expropriation of mining projects, but included resource rent taxes, new mining acts, state participation, amendments to royalty rates and even beneficiation.
In Brazil, the two most important
cement players are Camargo Correa Group with a 33% market share and Votorantim with a
30%. Both are strong and very unlikely to be outright sellers. As an example, they acquired a
controlling interest in Cimpor (Portugal
cement company) competing also with another brazilian group, steel company CSN.
The Transaction was closed in favour of Camargo & Votorantim and now both hold 33%
& 21% respectively, deal of about € 4,bn. This was a very big transaction in late 2009/early 2010. The cement market in Brazil exceeds 55
million tons with a growing demand sustained by projected infrastructure spending for World Cup 2014 and Olympics 2016. In Brazil, for an Indian company, the strategy could be to
find a niche or regional cement player (say in the North East) that would justify the risk to enter a
market dominated by these two giants.
Another play would be in
the industries related to the cement, like developers, construction companies, service
providers or suppliers. Here there are many more opportunities.
Diversified Indian conglomerate Aditya Birla Group may make an offer to buy certain Latin American assets of one of the world’s largest cement companies, Mexico’s Cemex, atleast four people said on condition of anonymity. The Birla’s are also in talks with Brazilian industrial giant Votorantim Group to buy some of their assets located in South America, according to two of the people quoted above.
An acquisition could cost Birla Group flagship UltraTech cements in excess of $1 billion.
Cemex has plants in several Latin American countries including Argentina, Colombia, Costa Rica, Mexico, Nicaragua, Panama and Puerto Rico and posted sales of $14.07 billion for the year ended December 31st 2010. The company has operations in more than 50 countries and the capacity to produce 96 million Metric Tonnes (MT) of cement annually.
Votorantim Cimentos, the cement division of the Brazilian conglomerate, has more than 30 cement plants in Brazil and is the market leader there. The company also owns a 21% stake in Portuguese cement major Cimpor which also has assets in Latin American countries.
Here is a warning for foreign banks scaling down retail loan portfolios in developed markets and looking to tap new growth markets in Asia. As high as 81 percent of consumers in emerging Asian markets and 63 percent of consumers in developed Asian markets consider it important to deal with a local institution, says a McKinsey Global Institute survey of 20,000 individuals in 13 Asian countries.
In India, this percentage surges to 95 percent, a jump of 20 percent over the survey conducted in 2007. “We speculate that these changes reflect Asian consumers’ anxiety over the safety of foreign banks in the aftermath of the financial crisis,” the survey says. It is not surprising that HSBC India CEO Stuart Davis — an expat manager himself — admitted that the bank was losing talent to local banks in India and faced higher wages in the country. According to a report in Bloomberg, he said this was unheard of earlier.
India will need 345 million tonne of foodgrains, including 95-100 million tonne wheat, by 2030, Minister of State for Agriculture Harish Rawat said today.
“India would require to produce about 95-100 million tonnes of wheat to reach the target of 345 million tonnes of foodgrains by 2030,” Rawat said in his inaugural speech at an ICAR function here.
Helped by good monsoon, the country produced 241.56 million tonne of foodgrains in 2010-11, of which wheat”s share was 85.93 million tonnes, according to the latest estimate of the agriculture ministry. ICAR Deputy Director General (Crop Sciences) Swapan K Dutta told
reporters that the future lies with crops that are heat, drought, biotic
and abiotic stress tolerant, which can be achieved by effectively using
It is an age-old image of rural India: a woman trudging a long distance with a huge pot of water precariously balanced on her head. And despite an ambitious nationwide effort to provide piped water to every rural household, it remains a common sight in most Indian villages.
An American “social entrepreneur” is now hoping to change that, by replacing the head-borne water pot, which carries 10 litres (2.2 gallons), with a 90-litre plastic drum that can be rolled home.
The concept is not new – the Q Drum and the Hippo Water Roller, for instance, were invented in South Africa in the early 90s. But their popularity has been limited because of their price, $70-$100 (£43-£61) each, too high for the developing world.
After trials in arid Rajasthan, Cynthia Koenig, who has an MBA from the University of Michigan, has set up Wello WaterWheel to make plastic water barrels for as little as $20-$30. The prototype has been created by a US design firm, Catapult.
“We’ll set up a pilot manufacturing unit and roll out the barrels by early next year,” said Koenig, 34. “During trials in Rajasthan villages, we found that people were really excited by it. The magic will be in making the right product at the right price and distributing it as widely as possible.” After tests in India, Mexico and Haiti, she is confident that the WaterWheel can be an all-terrain alternative to water pots.
Sometime in September, the first Mastretta MXT, a Mexican-designed, high-performance sports car, will roll out of a factory here, 30 miles west of Mexico City. Owners are promised an exhilarating experience when they hammer the accelerator.
The hand-built, rear-engine MXT accelerates from 0 to 60 mph in 4.6 seconds. Its designers say it’s built for people who itch to get off the street and onto the track. “We are targeting a niche,” said Jean-Paul Capin, the chief financial officer of Mastretta Cars, a division of Tecnoidea SAPI de CV, an engineering and design house based in Mexico City. The typical buyer will be a speed lover who has access to local raceways – and who has about $58,000 to spare.
“On the track, it’s a giant killer,” Capin said. “You can race against really high-end sports cars, Porsches and Corvettes, because of the power-to-weight ratio and the way the cars are set up. On the track, they are highly competitive against those cars at a fraction of the price.”
Few doubt Mexico’s broader automotive capabilities. Mexico is the world’s 10th biggest auto manufacturer, after China, Japan, the United States, Germany, South Korea, Brazil, India, France and Spain, in that order. Factories in Mexico pump out more than 2 million units a year. The cluster of associated industries is partly why Carlos and Daniel Mastretta thought they could make a go of it producing hand-built sports cars. Some 65 percent of the 1,900 components that go into the Mastretta MXT are available regionally, and the high labor costs of a hand-built car give them an edge in Mexico, where wages are low.
while Lord Ganesh removes obstacles, Indian entrepreneurs prefer to bypass them as much as possible
For Gautam Adani, the power mogul, the answer was simple: the easiest and most profitable way to meet India’s rising demand for electricity is to avoid the obstacles, divisive political confrontations and practical inefficiencies of India. In the spirit of the workaround ethos typical of India’s private sector, Mr. Adani is working around the subcontinent itself.
He owns the Indonesian coal mine, the Korean-made cargo ship (named for his niece Vanshi), the Indian power plant and, most important, the private Mundra port. He owns coal mines and a major port in Australia, and has built his own private railroad spur in India. His business plan is to do as much as possible without relying on the creaky infrastructure of the Indian state.
“He is able to do so well partly because he is very entrepreneurial and has found the right opportunity,” said Eswar Prasad, an economic adviser to India’s finance minister. “But it’s a symptom of a dysfunctional state. He is able to deliver something more effectively than the state.” Today, India is increasingly turning to the private sector to deliver the electricity needed to maintain rapid economic growth into the future. India’s economy is growing at more than 8 percent annually, but is badly constrained by an inadequate power supply after years in which the government dominated the power sector and failed to keep up with growing demand.
The rise of Mr. Adani attests to a broader shift, as the [Indian] private sector is playing a greater role in areas once controlled by the state like telecommunications, ports, airports, banks and infrastructure. At a global level, this contrasts sharply with China, where huge state-owned enterprises dominate strategic industries and lead the country’s global expansion. Mr. Adani recently had to outbid the Chinese for his Australian port.
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