Chinese media tells investors: Update your knowledge about India, it is much better than you think

Chinese media tells investors: Update your knowledge about India, it is much better than you think

An article in China’s state-sponsored Global Times has urged Chinese companies to update their knowledge about India before making investment decision. The article says that the popular image of India, the investors gather from media reports, doesn’t tell everything about the country. In fact, India’s condition is much better than what is often reported. While noting that number of rich people in India is “much bigger” than what many imagine, it said, “Many Chinese people think that India is a highly populated poor country characterized by diverse cultures, with frequent power cuts and a weak industrial base that is far inferior to China’s. That picture is true, to some extent, but it’s only a partial picture.”“According to the 2017 ranking of the world’s richest people by the Hurun Report, India has 100 billionaires, the fourth-highest number of super rich in the world,” it added.Compared to China’s government-led market development model, it said, “India’s federal government is slow to reach decisions. Yet, India’s development model allows innovative entrepreneurs to change the market from the bottom up.”
“Companies that grow big in the domestic market can go out to compete in the world and become driving forces for the country’s economic growth. As the market can offset flaws in governance, India’s entrepreneurship can compensate for its political deficiencies,” the article argued while advising Chinese companies to learn about India not just from media reports. “In addition to learning from the media, Chinese companies with plans to invest in India need to have a better understanding of the country from more sources, which may provide more data points for their investment decisions.”The article published on Wednesday also said that India-China cooperation is being hampered by “misconception.”“There is also a growing interest in India among Chinese companies, but many remain hesitant about investing in India due to concerns over its reform program and potential political risk,” it said. Further, the Global Times article noted, “The prevailing view in international academic circles is that India will likely replace China as the new “world’s factory,” which will be beneficial for China, India and even the world as a whole.”

Banks may need 20% incremental provisioning for 50 large NPAs

Banks may need 20% incremental provisioning for 50 large NPAs

Banks may need to do an incremental provisioning of 20 per cent for 50 large stressed accounts to absorb any losses, says a report. These 50 large accounts are from the sectors such as construction, power, and metals, among others and constitute about half of the gross non-performing assets of the banking sector. “Banks may require an incremental provisioning of 20 per cent against cumulative debt of 50 large stressed assets worth over Rs 4.3 lakh crore,” says a joint report by Assocham and rating agency Crisil. While banks may have already provisioned for a part of these exposures, they need to adequately capitalize to absorb such losses which could fuel credit growth and support the next leg of economic growth, it said.On Insolvency and Bankruptcy Code (IBC), the report said there is a need to address various challenges such as inter-credit conflicts, the ability of large corporates to delay the recovery process and burden on the National Company Law Tribunal (NCLT)/ Debt Recovery Tribunal (DRT). Roll-out of the ecosystem including the adequate number of tribunals, insolvency professionals and information utilities, a limited timeline for the formulation of resolutions and access to the secondary market is needed in case of liquidation for successful implementation of the IBC, it said.“The success of the code hinges on strengthening its ecosystem, which will help in protecting the interest of stakeholders, instilling financial discipline among borrowers and create a robust platform to attract investors,” the report noted. It said though the IBC is expected to face teething troubles before fully taking off, its stakeholders are expected to reap the greater benefit in the long run. Along with banks and asset reconstruction companies (ARCs), the IBC will benefit corporates, professionals, and employees, boost investor confidence, and facilitate deepening of the domestic corporate bond market, it added.

FDI in textiles doubled to $619 million in 2016-17

FDI in textiles doubled to $619 million in 2016-17

Foreign direct investment (FDI) in textile sector more than doubled to $618.95 million during 2016-17 from $230.13 million in the previous fiscal, Parliament was informed today. In a written reply to Lok Sabha, Minister of State for Textiles Ajay Tamta said during the first two months of current fiscal, the sector received $21.41 million foreign inflows. He also said textile exports during 2016-17 too rose to $36 billion from $23.9 billion in the previous financial year.In a separate reply, he said in rupee terms export of textiles and garments increased by 3.2 per cent in 2016-17. With a view to enhance investment, production and export of the textile industry, the government has launched a Rs 6,000-crore package for apparel and made-ups segments, he added.