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Friday, August 6, 2021

US says India ‘remains challenging place’ to do enterprise, urges to minimise bureaucratic hurdles

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India “remains a challenging place” to do enterprise, the US has mentioned, urging it to foster a lovely and dependable funding local weather by decreasing boundaries to funding and minimising the bureaucratic hurdles.

The State Division, in a report ‘2021 Investment Climate Statements: India’ launched on Wednesday, mentioned that India “remains a challenging place to do business” and likewise referred to the removing of the particular constitutional standing from the state of Jammu and Kashmir (J&Ok) and the passage of the Citizenship Modification Act (CAA).

“New protectionist measures, including increased tariffs, procurement rules that limit competitive choices, sanitary and phytosanitary measures not based on science, and Indian-specific standards not aligned with international standards, effectively closed off producers from global supply chains and restricted the expansion in bilateral trade,” the report mentioned.

In its report, the State Division mentioned that the Nationwide Democratic Alliance (NDA) authorities’s first 100 days of its second time period have been marked by two “controversial” selections.

The removing of particular constitutional standing from J&Ok and the passage of the CAA, it mentioned.

India maintains that the CAA was its “internal matter” and that “no foreign party has any locus standi on issues pertaining to India’s sovereignty.”

India has categorically informed the worldwide group that the scrapping of Article 370 was its inside matter.

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The State Division report mentioned that protests adopted the enactment of the CAA however ended with the onset of COVID-19 in March 2020 and the imposition of a strict nationwide lockdown.

The administration of Covid-19 turned the dominant difficulty in 2020, together with the drop in financial exercise and by December 2020, financial exercise began to indicate indicators of constructive progress.

“The BJP-led government has faced some criticism for its response to the recent surge in COVID-19 cases,” it mentioned.

The State Division mentioned that in response to the financial challenges created by the COVID-19 pandemic and the ensuing nationwide lockdown, India enacted intensive social welfare and financial stimulus programmes and elevated spending on infrastructure and public well being.

“The government also adopted production linked incentives to promote manufacturing in pharmaceuticals, automobiles, textiles, electronics and other sectors. These measures helped India recover from an approximately eight per cent fall in GDP between April 2020 and March 2021, with positive growth returning by January 2021,” it mentioned.

Noting that the Indian authorities continued to actively court docket overseas funding, the report mentioned that within the wake of COVID-19, India enacted bold structural financial reforms, together with new labour codes and landmark agricultural sector reforms, that ought to assist appeal to personal and overseas direct funding.

In February 2021, Finance Minister Nirmala Sitharaman introduced plans to lift USD 2.4 billion by an bold privatisation programme that may dramatically scale back the federal government’s function within the financial system.

In March 2021, Parliament additional liberalised India’s insurance coverage sector, rising the Overseas Direct Funding (FDI) limits to 74 per cent from 49 per cent, although nonetheless requiring a majority of the Board of Administrators and administration personnel to be Indian nationals, the report mentioned.

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