Archive for ‘Economics’

09/05/2013

* China and Taiwan cross-strait representative offices: One offensive, the other defensive

Another illustration of the Chinese pragmatism. Why let ‘politics and dogma’ stand in the way of good mutual trade relationship?

See also: https://chindia-alert.org/social-cultural-diff/chinese-mindset/

07/05/2013

* Indian farm sector to lose 4 million workers in 12th Plan period

What the Plan does not say is where the 4m surplus farm workers are going to get employment.

The Hindu: “The country’s agriculture sector is projected to lose four million workers in the 12th Plan period, the government informed Parliament on Tuesday.

The farm sector had contributed 8.8 million job opportunities during the ten year period from 1993-95 to 2004-05. File photo: G.N.Rao

As per the 11th Five Year Plan document of the Planning Commission, the agriculture sector “is projected to contribute no increase in the Eleventh Plan and a net decrease of 4 million agricultural workers over the Twelfth plan period” Minister of State for Agriculture Tariq Anwar said in a written reply to the Lok Sabha.

There is no potential for massive increase in employment in agriculture sector. However, indirect employment is likely to increase with rise in farm production particularly in agro-processing and in support infrastructure, he said.

The sector had contributed 8.8 million job opportunities during the ten year period from 1993-95 to 2004-05, he added.

The Minister said several schemes like National Food Security Mission, Rashtriya Krishi Vikas Yojana and Gramin Bhandaran Yojana launched in the agricultural sector aim at increasing production and in the process, create additional income and employment opportunities.

via Farm sector to lose 4 million workers in 12th Plan period – The Hindu.

07/05/2013

* 2,400 MTonnes wheat rotting in govt granaries for past 2 years

Times of India: “India may be facing the shame of 47% of its children suffering from malnutrition and about 30% of its population living below poverty line, but food continues to rot in government granaries. The Food Corporation of India (FCI) has admitted in data accessed through RTI that the amount of damaged wheat has increased from 2,010 million tonnes (MT) in 2009-2010 to 2,401.61 MT (2011-2012). The country has already suffered a loss of 932.46 MT damaged wheat this year, with the worst affected being Bihar.

Food Corporation of India

Food Corporation of India (Photo credit: Wikipedia)

The data has been given in response to an application filed by Uttar Pradesh resident, Kush Kalra. Till February, 2013, the FCI has on its hands “non-issuable wheat” or damaged wheat amounting to 932.46 MT. Bihar has the highest quantity of rotting wheat at 306.5 MT, followed by Uttarakhand (221 MT) and Gujarat (195 MT).

The total damaged wheat in 2009-2010 was 2010 MT. This came down marginally to 1997 MT in 2010-2011, but again rose to 2401.61 MT in 2011-2012.

According to data, the worst offender in 2011-2012 was Maharashtra (1444 MT), while in 2010-2011 Uttarakhand recorded (931 MT) of damaged wheat. Gujarat had the maximum (785 MT) damaged wheat in 2009-2010.

Ironically, India has lagged in improving its Global Hunger Index (GHI) score despite strong economic growth and food production. According to the 2012 Global Hunger Index report, 43.5% of children below five years are underweight, which accounts for almost two-thirds of the country’s alarmingly high GHI score. From 2005-10, India ranked second to last on child underweight — below Ethiopia, Niger, Nepal and Bangladesh.

Limited access for farmers to the open market, lack of covered or adequate storage space for grains have only served to compound the problem. As on April 1, 2013, FCI has covered godown space with capacity to store 33.99 MT that falls woefully short of the demand.”

via 2,400 MT wheat rotting in govt granaries for past 2 years – The Times of India.

06/05/2013

* Seawater can save thirsty country

desalination plant

desalination plant (Photo credit: roplant.org)

China Daily: “More government support, including subsidies and a favorable pricing mechanism, is needed for the country to use desalinated seawater to quench its thirst, a top industry expert said.

 

“The lack of an effective pricing mechanism for desalinated water and support for an operable policy is affecting the development of the country’s sea desalination industry,” said Li Linmei, director of the State Oceanic Administration‘s Institute of Seawater Desalination and Multipurpose Utilization in Tianjin.

The country aims to produce 2.2 million cubic meters of desalinated seawater daily in 2015, about three times current capacity, according to a National Development and Reform Commission plan released last year.

Current domestic water prices range from 2.4 yuan to 4.9 yuan a metric ton in the coastal regions, while the price of water for industry ranges from 3.3 yuan to 7.9 yuan a ton, according to ChinaWaterNet.

However, desalination plants can produce 674,000 tons daily at a cost of about 5 yuan ($0.80) a ton — not including infrastructure such as pipelines.

Li said the government should consider bringing desalinated water into the water grid.

Aside from subsidies and funding for pilot programs, Li believes desalination is a key part of water security.

“The seawater desalination industry is as important as water conservancy projects for China to cope with its water shortage,” Li said.”

via Seawater can save thirsty country[1]|chinadaily.com.cn.

06/05/2013

* Chinese buyers lured by local goods

China Daily: “Foreign brands no longer top choice for Chinese customers, says survey

Buyers lured by local goods

Chinese customers are no longer swayed by the lure of foreign brands and would instead prefer to buy more brands that are made in China, a survey said.

According to the 2013 China customers’ loyalty study conducted by marketing research firm Epsilon, six out of the 10 Chinese respondents endorsed foreign brands. However, there is a growing preference to buy products that are made in China. Local-brand supporters have grown to 43 percent from 31 percent in 2011, the report said.

Such trends are already visible in the Chinese fashion industry. In March, China’s first lady Peng Liyuan sparked off a craze for Chinese brands after dressing up in Chinese-made apparel for diplomatic visits.

Her elegant dressing code was dubbed by netizens as “Liyuan style”. Analysts argued that Peng’s support for domestic labels had stirred interest in local products and also helped attach a new, sophisticated image to Chinese-made clothes.

“Since local brands started to improve quality, establish appeal and step up their sophistication, they have garnered a bigger share from Chinese shoppers,” said Viven Deng, client services director of Epsilon China.

Chinese brands have started to win hearts not only from buyers pursuing extensive product features, but also from picky local consumers who previously stuck to foreign labels, she added.

Qi Lulu, a Beijing college student, who used to be a customer of leading international clothing brands such as Burberry and Polo Ralph Lauren, said she now focuses more on local brands.

“I buy dresses online, and I have found some domestic brands that have exquisite taste,” the 22-year-old woman said. Recently, Qi fell in love with a Beijing brand called Liebo, which featured traditional Chinese flavors and colorful patterns.

Self-branded products from other industries, such as cars and consumer electronics, are also growing in popularity. More Chinese people said they would support Chinese-made cars, especially after the Diaoyu Island dispute between China and Japan. Currently, Japan is still the major car vendor in the Chinese car market.

With a more than 1.1 billion mobile population in hand, China has grown into the world’s biggest smartphone market. The country manufactured the most number of smart devices, 224 million units, across the world last year.

Four out of the top five smartphone vendors in the Chinese market are domestic brands, with the South Korea-based Samsung Electronics Co the only international player in the list.

Huawei Technologies Co and ZTE Corp even successfully ranked as the world’s third and fifth smartphone manufacturer in the fourth quarter last year, according to research firm IDC Corp.”

via Buyers lured by local goods[1]|chinadaily.com.cn.

06/05/2013

* Indian Supreme Court gives nod to Kudankulam nuclear plant, says it is safe

Thank goodness.  India needs all the power it can generate.

Times of India: “In a relief for the Centre and the Tamil Nadu government, the Supreme Court on Monday approved the commissioning of the controversial Kudankulam nuclear plant.

English: Construction site of the Koodankulam ...

English: Construction site of the Koodankulam Nuclear Power Plant Deutsch: Baustelle des Kernkraftwerks Kudankulam (Photo credit: Wikipedia)

Kudankulam plant is safe and secure and it is necessary for larger public interest and economic growth of the country, the SC said.

“Nuclear power plants are needed in the country for the present and future generations,” observed the apex bench.

The apex court said that the Kudankulam N-plant has been set up by the government for the welfare of the people.

A bench of justices K S Radhakrishnan and Dipak Misra, which had reserved the verdict following marathon arguments in the last three months, delivered the judgement.

A batch of petitions was filed by anti-nuclear activists challenging the project on the ground that safety measures recommended for the plant by an expert body have not been put in place.

They also raised various questions pertaining to the disposal of nuclear waste, the plant’s impact on the environment and the safety of people living nearby, besides other issues linked to the controversial plant.

The Centre, Tamil Nadu government and Nuclear Power Corporation of India Ltd, which operates the plant, had refuted all the allegations on safety and security aspects.

They had submitted that the plant is completely safe and can withstand any kind of natural disaster and external terrorist attack.”

via SC gives nod to Kudankulam nuclear plant, says it is safe – The Times of India.

05/05/2013

* ‘Speed money’ puts the brakes on India’s retail growth

Reuters: “Hong-Kong entrepreneur Ramesh Tainwala spent 18 months operating branded clothing retail stores in India before deciding it was impossible to succeed without paying bribes.

Customers exit a V-Mart retail store in New Delhi April 6, 2013. Picture taken April 6, 2013. REUTERS-Adnan Abidi

Tainwala, a 55-year-old expatriate Indian, owns Planet Retail, which held the India franchise rights for U.S. fashion labels Guess and Nautica as well as UK retailers Next and Debenhams. He sold the brands last September to various Indian businesses.

“Right now it’s not possible to do business in India without greasing palms, without paying bribes,” said Tainwala, who is also luggage maker Samsonite’s president for Asia Pacific and West Asia. Tainwala said he himself refused to pay bribes to licensing officials, though that could not be independently confirmed.

India is the next great frontier for global retailers, a $500 billion market growing at 20 percent a year. For now, small shops dominate the sector. Giants from Wal-Mart Stores Inc to IKEA AB have struggled merely for the right to enter, which they finally won last year.

But a daunting array of permits – more than 40 are required for a typical supermarket selling a range of products – force retailers to pay so-called “speed money” through middlemen or local partners to set up shop.

In interviews with middlemen and several retailers, Reuters found the official cost for key licenses is typically accompanied by significant expenses in the form of bribes. The added cost erodes profitability in an industry where margins tend to be razor-thin. It also creates risk for companies by making them complicit in activity that, while commonplace in India and other emerging markets, is nonetheless illegal.

That creates a handicap for foreign operators such as U.S.-based Wal-Mart, the world’s biggest retailer, and Britain’s Tesco Plc and Marks and Spencer Plc, which must comply with anti-bribery laws in their home countries even while operating abroad.

A Wal-Mart spokesperson said the company is strengthening its compliance programs, part of a global compliance review that has cost more than $35 million over the last 18 months. IKEA, which is awaiting final approval to enter India, has started assessing the market, a spokeswoman said, adding the group has “zero tolerance” for corruption in any form.”

via Insight: ‘Speed money’ puts the brakes on India’s retail growth | Reuters.

05/05/2013

* Rural bamboo business thriving

China Daily: “The prosperity of the bamboo industry in Zhejiang province’s Lin’an county has come from community-driven development, in which farmers reach consensus with agricultural scientists, the local government says.

Rural bamboo business thriving

“The farmers’ prosperity has been self-determined rather than from policies derived by government decree,” Chinese Forest Academy of Bamboo Professionals committee member Wang Anguo explains.

“Farmers must be involved if their situation is to improve. We can’t just give them orders.”

The county’s bamboo production is 3 billion yuan ($487 million) a year, accounting for 55 percent of the local GDP. About 253 million yuan comes from exports.

Lin’an’s population of 250,000 dwell on 3,100 square kilometers, 65,833 hectares of which are covered with bamboo. About 32,600 hectares of those are for edible shoots.

It hosts about 100 processing factories. About 70 percent of the staff are farmers, including administration, Wang says.

The county even publishes the Lin’an Bamboo Newsletter.

Various levels of government also provide bamboo producers 1,500-3,000 yuan in annual subsidies.

The county is host to 67 types of moso (giant) bamboo, although moso bamboo represents only about 30 percent of its total bamboo coverage. There are 20 species in the county.

The most common is huangtian zhu (yellow-sweet bamboo), which is celebrated not only for being delicious but also for its ability to draw toxic substances from soil and prevent erosion.

“Farmers across the country used hazardous pesticides from the 1960s until the ’90s,” Wang says.

“So, we’ve been planting huangtian zhu around China to clean the earth.”

This is especially important in Lin’an, which is a major producer of edible shoots.”

via Rural bamboo business thriving[1]|chinadaily.com.cn.

05/05/2013

* China Still Has a Long Way to Go to Build a Service Economy

BusinessWeek: “The bad news keeps coming. Following two days of dismal numbers showing China’s manufacturing sector is slowing, now the service sector has disappointed. The not-so-happy takeaways: Don’t expect an economic recovery soon, and Beijing’s much sought-after goal of rebalancing still looks far off.

Shoppers pick up vegetables at a market in Beijing

On May 3, China’s National Bureau of Statistics and the China Federation of Logistics and Purchasing announced that their nonmanufacturing purchasing managers’ index cooled to 54.5 in April, down from 55.6 the month before. Anything above 50 indicates expansion. The index tallies responses from 1,200 companies in 27 service industries, including retail, catering, construction, and transportation. A separate services index will be released by HSBC (HSBA) on May 6.

“The reading suggests that growth momentum will remain relatively soft” in the second quarter and that China’s economy “has shifted to a weaker growth trajectory,” Crédit Agricole CIB (ACA) economist Dariusz Kowalczyk said to Bloomberg News.

Beijing has set a goal of weaning its economy off excessive reliance on investment and exports and rebalancing toward a cleaner, more sustainable, services and consumption-driven GDP. That requires an end to artificially low interest rates, the undervalued yuan, and subsidized energy prices (three-quarters of energy goes to industry), as well as more government social spending, argue Nicholas Lardy and Nicholas Borst, of the Peterson Institute for International Economics, in a February policy brief.

“Higher lending rates lead to less capital-intensive economic development resulting in more job creation, higher household income, and ultimately higher levels of household consumption,” write Lardy and Borst. (Household consumption makes up a very low 37 percent of GDP today, while investment has exceeded 40 percent every year for the past decade). And “an appreciation of the currency would also decrease the profitability of the export-oriented manufacturing sector to the relative benefit of the service sector of the economy, which has languished since 2002,” the authors add.

via China Still Has a Long Way to Go to Build a Service Economy – Businessweek.

See also: https://chindia-alert.org/2013/04/19/chinas-growth-the-making-of-an-economic-superpower-dr-linda-yueh/

05/05/2013

* Plans to Harness China’s Nu River Threaten a Region

NY Times: “From its crystalline beginnings as a rivulet seeping from a glacier on the Tibetan Himalayas to its broad, muddy amble through the jungles of Myanmar, the Nu River is one of Asia’s wildest waterways, its 1,700-mile course unimpeded as it rolls toward the Andaman Sea.

The Nu River at Bingzhongluo, China. The government stunned environmentalists by reviving plans to build dams on the river. More Photos »

But the Nu’s days as one of the region’s last free-flowing rivers are dwindling. The Chinese government stunned environmentalists this year by reviving plans to build a series of hydropower dams on the upper reaches of the Nu, the heart of a Unesco World Heritage site in China’s southwest Yunnan Province that ranks among the world’s most ecologically diverse and fragile places.

Critics say the project will force the relocation of tens of thousands of ethnic minorities in the highlands of Yunnan and destroy the spawning grounds for a score of endangered fish species. Geologists warn that constructing the dams in a seismically active region could threaten those living downstream. Next month, Unesco is scheduled to discuss whether to include the area on its list of endangered places.

Among the biggest losers could be the millions of farmers and fishermen across the border in Myanmar and Thailand who depend on the Salween, as the river is called in Southeast Asia, for their sustenance. “We’re talking about a cascade of dams that will fundamentally alter the ecosystems and resources for downstream communities that depend on the river,” said Katy Yan, China program coordinator at International Rivers, an advocacy group.

Suspended in 2004 by Wen Jiabao, then the prime minister, and officially resuscitated shortly before his retirement in March, the project is increasing long-simmering regional tensions over Beijing’s plans to dam or divert a number of rivers that flow from China to other thirsty nations in its quest to bolster economic growth and reduce the country’s dependency on coal.

According to its latest energy plan, the government aims to begin construction on about three dozen hydroelectric projects across the country, which together will have more than twice the hydropower capacity of the United States.

via Plans to Harness China’s Nu River Threaten a Region – NYTimes.com.

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