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India positioned favourably to fulfil global demand for skilled labour: Report

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India is poised to become a significant contributor to the global workforce, addressing the demand for skilled workers in developed nations grappling with aging populations, according to a senior executive of TeamLease Degree Apprenticeship. Historically known for its global workforce, India has seen a surge in demand for its skilled workers, with an annual growth rate ranging from 15-20%. This trend is expected to continue, with projections indicating a growth rate of 28-30% over the next five years.

With a young population, India is well-positioned to meet the demand for skilled workers globally. The country’s International Skilling Centre (IISC) Network aims to facilitate international workforce mobility by placing skilled Indian candidates overseas, providing pre-departure orientation to 250,000 candidates, and certifying 25,000 workers through recognition of prior learning assessment. Ongoing labor agreements with countries like Japan and France further bolster India’s prominence in the global labor market.

Saudi Arabia has emerged as the top destination for Indian workers, followed by Qatar and the UAE. Currently, 12,000 individuals are undergoing training for international mobility, with a focus on healthcare workers learning foreign languages such as Japanese, Italian, and German. Additionally, there is a rising demand for construction skills in GCC and Eastern European countries, IT professionals worldwide, and emerging green jobs.

India and Japan have signed a Memorandum of Cooperation to implement ‘Specified Skilled Worker’ programs, addressing labor shortages in Japan. The Skill Ministry data reveals significant employment of Indians in various sectors overseas, including construction, facility management, healthcare, and mechanical, electrical, and plumbing skills. To meet global requirements, candidates are trained in skill development per international standards and given language training. The National Skill Development Corporation International has signed agreements with 11 countries to facilitate training, assessment, and recruitment services, focusing on in-demand sectors such as IT, construction, healthcare, data analytics, and hospitality.

These initiatives underscore India’s growing importance in the global labor market, with its skilled workforce increasingly sought after across diverse sectors worldwide. As the country continues to invest in skill development and forge international partnerships, it is poised to play a pivotal role in meeting the evolving demands of the global economy. With a focus on enhancing the employability of its workforce and addressing emerging skill requirements, India is solidifying its position as a key player in shaping the future of work on a global scale.

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Economic

African economies to grow 3.4 per cent in 2024, says World Bank

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The report said increased private consumption and declining inflation were supporting an economic rebound in Sub-Saharan Africa.

The latest Africa’s Pulse report by the World Bank indicates an economic rebound in Sub-Saharan Africa, driven by increased private consumption and decreasing inflation. However, the recovery remains fragile due to uncertain global economic conditions, mounting debt service obligations, frequent natural disasters, and escalating conflict and violence.

The report emphasizes the necessity for transformative policies to address entrenched inequality, ensuring sustained long-term growth and effective poverty reduction. While the region’s growth is expected to rebound from 2.6% in 2023 to 3.4% in 2024 and 3.8% in 2025, the recovery remains precarious. Despite a decline in inflation across most economies to 5.1% in 2024 from a median of 7.1%, it remains elevated compared to pre-COVID-19 levels.

Additionally, while growth of public debt is slowing, more than half of African governments grapple with external liquidity problems and face unsustainable debt burdens. Overall, the report underscores that despite the projected boost in growth, the pace of economic expansion in the region remained below the growth rate of the previous decade (2000-2014) and is insufficient to have a significant effect on poverty reduction. Moreover, due to multiple factors including structural inequality, economic growth reduces poverty in Sub-Saharan Africa less than in other regions.

“Per capita GDP growth of 1 percent is associated with a reduction in the extreme poverty rate of only about 1 percent in the region, compared to 2.5 percent on average in the rest of the world,” said Andrew Dabalen, World Bank Chief Economist for Africa. “In a context of constrained government budgets, faster poverty reduction will not be achieved through fiscal policy alone. It needs to be supported by policies that expand the productive capacity of the private sector to create more and better jobs for all segments of society.”

The World Bank’s Africa’s Pulse report called for several policy actions to foster stronger and more equitable growth. These include restoring macroeconomic stability, promoting inter-generational mobility, supporting market access, and ensuring that fiscal policies do not overburden the poor.

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Pakistan to adopt National Fiscal Policy amid bailout talks with IMF, says World Bank

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Amid the staggering economic crisis in Pakistan, the World Bank has asked Islamabad to adopt a national fiscal policy by aligning federal and provincial spending with constitutional mandates, merging various federal and provincial revenue agencies into a single general sales tax (GST) collection agency, and effectively taxing agriculture, capital gains, and real estate in the next fiscal year’s budget, Dawn reported on Monday. “Implement the new Fiscal Responsibility and Debt Limitation Acts (FDRLA) at the federal and provincial levels, including through the development and implementation of a national medium-term fiscal framework through the FY25 budget process,” the World Bank asked the government in its latest policy advice.

This is now expected to be made part of the next International Monetary Fund program that Pakistan Finance Minister Muhammad Aurangzeb will be discussing with the lender next week in Washington on the sidelines of the World Bank-IMF spring meetings, Dawn reported. The bank demanded tangible progress on GST harmonisation across the federation and its federating units, “including through the rollout of the GST portal,” and a move towards “rate harmonisation to facilitate tax compliance and the provision of input tax credits.”. On top of this, the World Bank also suggested “consolidation of all GST collection responsibilities with a single agency, which could then distribute revenues in accordance with constitutional provisions” to reduce administrative complexity.

At present, GST is collected by the Federal Board of Revenue, mostly on goods and some services, while similar revenue boards are operating in provinces to collect GST on some services. However, given the overlapping nature of certain services, the stakeholders have been facing GST collection adjustments among the provinces. More importantly, the World Bank wants decisive actions to mobilize revenues from underutilized sources, particularly those relating to the unfinished agenda of the 7th National Finance Commission (NFC) award of 2010: urban immovable property tax, agricultural income tax, and capital gain taxes. While conceding greater federal pool resources to the provinces, it was agreed to effectively bring these areas into the tax net to increase the tax-to-GDP ratio to 15 percent in five years, but the deal (NFC) was drafted in a weak manner.

Dawn reported that the NFC had “recommended that the federal and provincial governments streamline their tax collection systems to reduce leakages and increase their revenue through efforts to improve taxes and achieve a tax-to-GDP ratio of 15 percent by the terminal year 2014–15. Provinces would initiate steps to effectively tax the agriculture and real estate sectors.” However, this has remained a pipe dream over the following 15 years. As for urban immovable property tax, the World Bank has demanded the application of harmonised valuation tables (currently based on rental value) to be updated annually based on observed variables such as inflation, insurance valuation, and sales records, and also to equalize rates between owner-occupiers and rentals.

In this regard, the bank also wants authorities to harmonize and reduce exemptions such as area-based exemptions, owner-occupier exemptions, and non-resident exemptions and to unify federal deemed income tax and urban immovable property tax. For agricultural income tax, the World Bank has asked the government to make the definition of land area consistent, reconsider exemptions based on the size of land holdings, and set common minimum rates based on crop acreage or production estimates. At the same time, the government should also incorporate irrigation and/or construct buildings to differentiate per-hectare minimum rates. Dawn reported that regarding the capital gains tax, the bank has advised the government to unify the treatment of builders, property developers, real estate investment trusts (REITs), and others, simplify the types of taxes related to capital gains and transfers (capital gains tax (CGT), capital value tax (CVT), stamp duty, withholding tax, etc.), remove years-held based differential rates, and simplify the rate structure.

Overall, the World Bank has suggested broader revenue reforms to expand the tax base, improve progressivity, and ease compliance. To achieve this, it wants to close existing corporate and sales tax exemptions, including tax exemptions for real estate, the energy sector, COVID response, and some basic household goods, and instead compensate poor households for negative impacts through enhanced social protection.

To improve tax compliance, the bank has called for addressing constraints delaying the rollout of the track-and-trace system to all sectors and simplifying the tax structure by reforming the “personal income tax (PIT) system to reduce complexity by aligning schemes for salaried and non-salaried workers” and reforming PIT schedules to increase equity by eliminating privileged treatment of specific income sources and by harmonizing rate structures across taxable income sources.

The Planning Commission has already prepared a national planning framework for the upcoming National Economic Council, with the overall theme of ending provincial projects from the federal budget and improving resource deployment through federal and provincial “synergy” in the light of the “true spirit of the constitutional scheme,” including the 7th National Finance Commission Award and 18th constitutional amendment, Dawn reported.

An official said the planning framework would “offer an operational strategy for federal and provincial governments in the context of prevailing constitutional responsibilities and roles for the shared and common objective of development and growth.”. He said the concept of balanced development and regional equity was not only the responsibility of the federal government but equally that of the provinces through their respective development programs, and it was also the essence of the 7th NFC and 18th Amendment.

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China’s PLA enhances the capability of its helicopter fleet

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Its armament features a cannon, likely of 23mm caliber, as well as a pair of stub wings that each possess three weapon stations for rockets and missiles.

In a significant stride towards self-reliance, China’s aerospace sector has transitioned from dependence on Russian and reverse-engineered European helicopters to designing and manufacturing its own range of aircraft. The latest addition to this endeavor is a cutting-edge heavy-attack helicopter, reminiscent of the American AH-64 Apache.

Photographs captured by Chinese citizens, albeit in low resolution, surfaced on the internet in late March, showcasing the new attack helicopter undergoing flight testing. Speculation suggests that this clandestine aircraft undertook its inaugural flight as early as January. While its official designation remains uncertain, it is commonly referred to as the Z-21.

What sets the Z-21 apart is its lineage traced back to the Z-20 utility helicopter. Andreas Rupprecht, a noted German authority on Chinese aviation, remarked to the media, “Now with the first images at hand, it’s almost surprising that we didn’t put together those pieces we’ve known for years.” He elaborated on the evolution of the Z-20 into a mature system, highlighting the appearance of prototypes featuring enhanced sensors and armaments. Thus, the Z-21, leveraging the proven powertrain, transmission, engines, and tail arrangement of the Z-20, coupled with a refined fuselage, represents a logical progression in China’s helicopter development journey.

By making use of Z-20 components, China can accelerate the new platform’s development and also reduce risk. Reusing the Z-20’s tail boom, the new Z-21 has a slim, tandem-seat fuselage with wide cheek fairings, just like the Apache does. Like modernized variants of the Z-10, the Z-21’s engine exhausts face upwards to reduce the aircraft’s infrared signature and thus improve its chances against surface-to-air missiles.

Its armament features a cannon, likely of 23mm caliber, as well as a pair of stub wings that each possess three weapon stations for rockets and missiles. The scant photos available so far show that the nose of the Z-21 resembles that of the Russian Mi-28N helicopter. A millimeter-wave radar could eventually appear on the platform, akin to the Longbow radar on the Apache.

One might wonder why the PLA needs another attack helicopter, given that it already has several hundred Z-19 scout/reconnaissance helicopters and Z-10 attack helicopters in service. However, neither of these platforms offers the level of performance, armor protection, or payload capacity that China’s military ultimately seeks. It is probable that a capacity for manned-unmanned teaming—for example, using the helicopter to control drones—will be part of its future mission set too.

With WZ10 engines, the new aircraft’s performance relative to the 5.5-ton Z-10 attack helicopter will be superior. Indeed, one of the Z-10’s main issues is its underpowered WZ9 engines, which negatively impact its flight performance, armor protection, and payload capacity. Especially in hot and/or high-altitude conditions, the Z-10’s performance is unsatisfactory, something that Pakistan concluded after testing.

With two 1,790kW WZ10 engines, the high-altitude performance of the Z-21 will be boosted, making it better suited for service along the mountainous Indian border. Given that the Z-21 has only just started flying, its entry into service is still some time away. Some Chinese commentators think it could appear in the PLA within 2-3 years, but Rupprecht told ANI that this is “questionable.” He compared it with the naval version of the Z-20, for instance.

Although it first flew in 2018 and requires fewer modifications than the Z-21, it has not entered service yet. Using this as a comparison, the German expert noted, “In my opinion, something like 5-7 years is very likely.” That would put the date around 2029–31. Helicopters epitomize the ongoing modernization of the PLA, something that Chairman Xi Jinping has prioritized since coming to power more than a decade ago.

Over the past 12 or so years, PLA rotary-winged aviation capacity has grown considerably. For example, ten Z-10 helicopters in 2011 had grown to 150 by 2021, and seven Z-8 helicopters had snowballed to 111 in this period. A recent edition of Military Balance, published annually by the International Institute of Strategic Studies in the UK, listed the following inventory for the PLA Ground Force: 300+ attack helicopters (Z-10 and Z-19 types); 208 multirole helicopters (Mi-17 and Z-9); and 398 transport helicopters (111 Z-8 heavy helicopters; 219 Mi-171 and S-70C2 medium helicopters; and 68 H120 and Z-11 light helicopters).

The PLA Navy has around 110 helicopters, plus more than 50 are in the PLA Air Force too. The Z-20 utility helicopter is a key platform that has spawned a range of specialized variants. China describes the Z-20 as a home-grown design, but it is a facsimile of the American Black Hawk. Z-20s are expected to gradually replace more than 250 Russian-manufactured Mi-17/Mi-171 helicopters in the PLA.

A 2021 report by the China Maritime Studies Institute of the US Naval War College, entitled “The PLA Army’s New Helicopters: An ‘Easy Button’ for Crossing the Taiwan Strait?” asked how China’s new helicopters stack up qualitatively against their US equivalents. “This current generation of Chinese platforms likely compares favorably to their US counterparts, which should come as no surprise given the latecomer catch-up advantage and the proliferation of technological expertise.”

As well as the PLA Ground Force, the PLA Navy Marine Corps might eventually adopt the Z-21, especially with China’s laser-like focus on Taiwan. In a Taiwan invasion scenario, for instance, the Z-21’s combat range, similar to that of the Apache at approximately 500km, would enable it to fly across the Taiwan Strait and back in support of an invasion. Of course, operations against offshore Taiwanese islands in the strait would be within far easier reach. Quite apart from using helicopters to support a massive amphibious invasion of Taiwan, the aforementioned US Naval War College report raised the possibility of transport and attack helicopters conducting decisive operations against Taiwan in their own right by using inland landing zones. In other words, helicopters could form part of multi-dimensional attacks against Taiwan.

The report’s author, Tom Fox, calculated that PLA planners could achieve four cross-strait insertions in the first 24 hours of a military operation, though he pointed out that “these high levels of flight hours are unsustainable for anything but the briefest operational windows.” Helicopters could conduct attack-in-depth operations, leapfrog combat, and vertical landing operations in support of a Taiwan invasion. While these missions offer the PLA decisive advantages, they are also most at risk from Taiwanese defenses.

Fox concluded that “in theory, [helicopters] could eventually become a game-changer for the military balance across the strait, but they are not that yet.” Indeed, an amphibious invasion of Taiwan proper would be a risky and bloody endeavor for the PLA, as Vladimir Putin’s invasion of Ukraine, without any water crossings to negotiate, demonstrated.

Dennis Blasko, a former US defense attaché in Beijing and Hong Kong in the 1990s and an expert on the PLA, told ANI that due to limitations in amphibious vessels, China would struggle to land more than 10,000 troops on the first day of an amphibious assault. Because of limitations in amphibious capacity, Blasko highlighted the role that army aviation and special forces could play in any potential Taiwan invasion. The PLA has 15 army aviation brigades with perhaps 1,000–1,500 helicopters. By moving 4-5 extra aviation brigades into the area across from Taiwan, perhaps 700–800 helicopters could be mustered for an assault. In one of two days, these could perhaps land 10,000 troops behind the coast to attack airports and ports. Air assault, special operations, and airborne troops could create havoc for Taiwan’s defenders, and such light, mobile units make good sense since Taiwan’s terrain is unfavorable for heavy armor.

Furthermore, the PLA Air Force’s Airborne Corps of approximately 30,000 troops could play an important role against Taiwan as well. Blasko concluded, “That is one of the things I don’t see spoken about enough right now. I’m thinking that the whole across-the-beach invasion is what people are focused on when China now has the capability to come in behind.”

Helicopter units would have to fly tight formations at low altitudes when crossing the 100-mile-wide Taiwan Strait. Beijing would aim to force Taiwan’s political leaders to capitulate as soon as possible. Thus, a decapitation strike aimed at Taipei, and specifically Taiwan’s Presidential Office Building, could be one target. Interestingly, a new Chinese bombing range in Inner Mongolia (located at 39°17’43.1” N 105°29’59.7” E) replicates this very complex that includes the Legislature, Ministry of Foreign Affairs, Ministry of Justice, Executive Branch, and the president’s living quarters. This is different from a previously identified mock-up of the Presidential Building in Zhurihe that is used by special forces to practice ground assaults against these government branches.

Of course, for either an amphibious or air assault against Taiwan, there would be obvious movements and concentrations of troops, vessels, and aircraft to give warning time. As Blasko pointed out, “The big invasion, whether it be by air or sea, that’s going to take the movement of a lot of folks over a lot of time.”

Indeed, prepositioning the required helicopters, personnel, and ammunition for five extra brigades closer to the coast and within range of Taiwan would be nigh impossible to hide. This move would take days, likely over a week, according to Fox. Discussing the complexity of such helicopter operations, Fox noted, “The distance involved in crossing the strait from suitable mainland staging areas does not allow much room for error in deconflicting the airspace. Each brigade-level air assault demands its own unique entry and exit routes, and prudence dictates planning at least an alternate route, if not a second alternate as well, depending on the resistance encountered at the shoreline or elsewhere.”

Fox further remarked, “Taiwan has a significant advantage here as it prepares defenses for an anticipated PLA air assault. Terrain restricts the suitability of landing areas while also dictating preferred air corridors, so there is ample time to plan defenses of key terrain and increase the degree of difficulty for PLA helicopters.”

Chinese aviation brigades may each have 80+ helicopters, compared to around 110 helicopters in US Army combat aviation brigades. However, although the USA has a higher ratio of helicopters to soldiers, the PLA fleet is probably still growing. A typical PLA aviation brigade has four transport battalions, two attack battalions, one reconnaissance squadron, a headquarters element, and a maintenance and support battalion.

The PLA also has two designated air assault brigades, belonging to the 75th and 83rd Group Armies. Fox remarked, “These air assault brigades differ from the standard aviation brigade because they have two or three permanently assigned infantry battalions. This arrangement enables them to focus narrowly on training for air assault operations and increases their proficiency for that specific mission set.”

Although the PLA is fielding new and more capable helicopters like the Z-20 and Z-21, China is not yet ready to use them to invade Taiwan. Fox concluded, “Based on the evidence currently available, the PLA is at best a decade away from being able to mount an operation on this scale with the requisite joint integration to give it a fighting chance for success.” He continued, “The PLA’s doctrinal preference for caution suggests that such a high-risk and low-certainty operation does not match the clear objectives of managed risk and high certainty embraced by the PLA. Still, air assault operations do present new opportunities for the PLA as it considers its options for future Taiwan scenarios. Given the notorious difficulty of amphibious operations, the PLA is making a prudent investment by developing more robust air assault capabilities.”

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Economic

UNGA President praises India’s digitalization, infrastructure Investment

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Dennis Francis, the President of the UN General Assembly, has praised India for its effective utilization of digitalization, which has facilitated financial inclusion and poverty alleviation. He emphasized that this positions the country with a “comparative advantage” and suggests that its insights can benefit the global community.

“Let me say first of all that since I’ve been to India, every time I think of India, I think of Incredible India. And I mean this in all earnest. And I saw it when I was there. The specific example to which I can refer is India’s use of digitalization,” Francis, President of the 78th session of the UN General Assembly, told PTI in an exclusive interview. He referred to the country’s tourism tagline of ‘Incredible India’.

Francis was in India from January 22-26 this year on an official visit, during which he held a bilateral meeting with External Affairs Minister S Jaishankar in New Delhi and also travelled to Jaipur and Mumbai. During the visit, his interactions with government officials, civil society members, and think tanks focused on issues such as sustainability, multilateralism, accessibility, and digital public infrastructure.

The UN leader lauded India’s use of digitalization to alleviate poverty and bring millions of people into the formal economic system “simply through the use of a handset and a digitalization model.” He underscored that digitalization is important because it is “productive, it drives cost down, makes economies more efficient, makes things cheaper.” He cited the example of digitalization helping Indian women and farmers across the length and breadth of the country and in far-flung places to negotiate their prices, deal with banks, and make payments without having to leave their homes, farmlands, or areas.

“All of this is helping to make the economy of India much more competitive. So I think this is an area in which India has a comparative advantage and has lessons that can be shared with the international community.”

Francis also pointed out that during his visit to India, he was impressed with the level of investments being made in infrastructure development across the country.

He stressed that infrastructure is one of the areas of economic activity known to boost growth in any economy because it creates huge demands for materials, labor, and inputs and provides jobs. “Because of the multiplier effect, growth literally gallops,” he said. “I noted when I was in your country recently, India, and I was really quite impressed with this – the extent of investment being made in infrastructure in India, not just highways but even rail and monorails,” he said. He said that countries invest heavily in infrastructure because infrastructure integrates markets and brings people together but it also has an immediate and consequential impact on growth.

Francis, however, stressed the need for building infrastructure sustainably in the current times of extreme climate events. “If the infrastructure is built in a sustainable way, if it is resilient and can therefore withstand external shocks and stresses, it means that the economy is able to bounce back more quickly from that event, fewer jobs are lost, and it requires less in the way of investment to get things working and moving again in the economy,” he said.

It makes sense to use sustainable materials and methods and invest in sustainable infrastructure because it minimizes the overall disruption in the economy, he said.

Francis will convene the UN’s first-ever “Sustainability Week” April 15-19 at the world body’s headquarters that will feature dedicated events focused on sustainability in critical sectors such as tourism, infrastructure connectivity, transport, energy, and debt.

He has said that the goal of the week will be “to unleash progress across the 2030 Agenda towards a more sustainable future” as we also ready ourselves for the Summit of the Future to be held in September 2024 during the high-level General Assembly session.

Last year, India’s Permanent Representative to the UN Ambassador Ruchira Kamboj highlighted at the world body the impact of financial inclusion on the social and economic empowerment of people in India. She noted that in 2009, only 17 per cent of adults in India had bank accounts, 15 per cent used digital payments, one in 25 had a unique ID document, and about 37 per cent had mobile phones. These numbers grew exponentially, and today, tele density has reached up to 93 per cent, over a billion people have a digital ID document, and more than 80 per cent have bank accounts. As of 2022, over 600 crore digital payment transactions were completed per month.

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Growing poverty and malnutrition crisis in Afghan women, Children

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According to WFP reports, an alarming 1.2 million women are now grappling with malnutrition across the country.

The United Nations World Food Programme in Afghanistan has issued a warning concerning the escalating malnutrition rates among women and children in the country. The report emphasizes that over the past three years, malnutrition admissions in Kabul have tripled. The UN agency noted that Afghanistan’s malnutrition situation is deteriorating, attributed in part to reduced humanitarian supplies reaching the nation. The UN agency stated that the situation is getting “worse” in Afghanistan due to the increase in malnutrition. One of the main causes of the rise in malnutrition in Afghanistan has reportedly been the decrease in humanitarian supplies to the nation.

According to Mishro, a nurse at a malnutrition ward, the mental and psychological health of women has declined over the last two years, and the number of malnutrition cases in Afghanistan has been rising. She underlined that there is not enough room for these patients and that undernourished moms have contributed to their children’s malnourishment. “For women who are malnourished, the situation is not good in 50 per cent of cases,” she continued.

Meanwhile, the World Food Programme has also highlighted the rise in the number of malnourished women in the nation. This occurs at the same time that human rights organizations are becoming increasingly concerned about Afghanistan’s rising rates of poverty and malnutrition, particularly among women.

Afghan people have been leaving their homes because of poverty, insecurity, and conflicts in the country. Moreover, Afghanistan’s women have faced numerous challenges since the Taliban returned to power in 2021. Taliban leaders have also disregarded international calls for women and girls to be given access to education and employment. Apparently, they have also issued warnings to other nations not to meddle in Afghanistan’s domestic affairs.

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PMO asks comm min to examine model text of BIT

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These agreements are important as India has earlier lost 2 international arbitration cases against British telecom giant Vodafone and Cairn Energy plc of the UK over the retrospective imposition of taxes.

According to sources, the Prime Minister’s Office (PMO) has asked the commerce ministry to review the model text of the bilateral investment treaty (BIT) and suggest modifications to further improve the ease of doing business. The exercise assumes significance as only seven nations have accepted the existing model text treaty, and most of the developed nations have expressed their reservations on the text with regard to provisions like the resolution of disputes. These investment treaties help in protecting and promoting investments in each other’s countries. These pacts are important as India has earlier lost 2 international arbitration cases against British telecom giant Vodafone and Cairn Energy plc of the UK over the retrospective levy of taxes.

On Monday, as per the sources, an internal discussion will be held at the Commerce Ministry on the model text of the treaty with experts and lawyers. “There will be a presentation in the meeting. We are having an internal discussion on the issue. The PMO is looking into it and has asked the commerce ministry to provide a third-party perspective on the model text,” they said. Although BIT is the subject matter of the finance ministry, the commerce ministry will try to elicit the views of the third party and suggest ways for consideration to higher authorities.

Investment facilitation is one of the chapters in the free trade agreement being negotiated by the commerce ministry. The treaty is a key sticking point between India and the UK, as both countries are negotiating a free trade agreement and BIT. According to experts, the four-European nation bloc EFTA (Iceland, Liechtenstein, Norway, and Switzerland) would also demand BIT. On 10 March, India and the European Free Trade Association (EFTA) signed a free trade agreement. Under the agreement, New Delhi received an investment commitment of 100 billion dollars over 15 years from the grouping. The agreement also allows for lower or zero duties on several products, including Swiss watches, chocolates, and cut and polished diamonds.

Economic think tank GTRI (Global Trade Research Initiative) has stated that as India aims to become the third-largest economy, it needs to align its treaties with global investment practices, address the negative perception caused by the mass treaty cancellations and reflect on its negotiation skills. It has said India has canceled 77 of its over 80 Bilateral Investment Treaty (BIT) by 2016, as they didn’t align with its interests.

“Now, Ajay Srivastava, GTRI co-founder, has said that it is renegotiating with 37 nations using the restrictive 2016 Model BIT. This may lead to protracted negotiations due to its narrow definition of ‘investment,’ vague terms, omission of principles like ‘fair and equitable treatment,’ and Most-Favored Nation status.” According to Srivastava, the model BIT demands investors seek local solutions for at least five years before arbitration, making new BITs challenging for other countries.

Finance Minister Nirmala Sitharaman, in her interim Budget speech on 1 February, has said that India is negotiating bilateral investment treaties with different countries.

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