Head of Capital Investment Coordinating Board (BKPM) Thomas Lembong said President Joko Widodo held a business meeting with a number of Australian business investors on his first day in Australia.
The Indonesian president discussed issues on cooperation in mining and tourism sectors.
“There were approximately 10 companies and two associations, accompanied by a number of representatives from the Australian government. The discussion included issues on mining, especially gold, as it has high investment value,” he said in Sydneys Shangri-La Hotel on Saturday (Feb. 25).
The investment value in the gold mining sector, is recorded to be at 7 to 13 trillion rupiah for each corporation, he stated.
The Agency Head further stated that the gold mining sector currently acts as a contributor for foreign exchange and is currently performing very well.
As for the tourism sector, Lembong said that Australia is a nation with strong maritime embodiment and spirit.
“Australia is very strong country with a strong culture, and the people are keen on spending their leisure time on a ship,” he noted.
The agency noted that there are a number of Australian companies that are currently building marinas in Lombok and Rajaampat, aimed at expanding Indonesias tourism sector.
Although Australias investment in Indonesias tourism sector is not significant yet, he believed that the construction of the marinas can open new investment sectors in a number of tourist destinations.
“Furthermore, supporting services and tourism can also generate foreign exchange for the country. All foreign tourists who sail through Indonesias islands pay their spending with foreign currencies. In the beginning, it may not appear to be that significant, but it will surely affect the people and job field,” he remarked.
He also said that Widodo had listened to all the needs and complaints of Australian investors in a bid to strengthen both countries economy.
“We should not be overwhelmed by excessive regulations. The president even stated that this was a fragmentation, and if each region comes up with their own regulations, standards and formats, then it is like turning one massive market into hundreds of smaller ones,” he explained.
In the beginning of March, Indonesia will host the Indonesia-Australia Business Meeting in Jakarta, which will also open the opportunity for both countries to strengthen their cooperation in the investment sector, he asserted.
The BKPM targets Australias investment in Indonesia to reach US$3 billion, or Rp39 trillion, in the next 3 to 5 years.
“India has the potential for a growth rate higher than what we are achieving today,” Jaitley said. He added that in the early days of liberalisation there had been dissenting voices but those “fears have receded to the background.”
Support for refor
“You have much greater support for reform than any other time in history. The idea of a protectionist economy has not been an issue for India…We’ve opened up and it’s been more welcomed than opposed.”
However, he said that discussions with his counterparts in Britain have convinced him that Brexit cannot be “confused with any protectionist idea.” “There is a keenness to expand trade with India.”
Jaitley has used his public appearances during the trip to focus on India’s reform agenda, outlining the long-term impact it hopes the implementation of GST, and demonetisation, will have on efforts to improve the collection of taxes, enabling the government to increase spending on infrastructure and poverty reduction.
On Monday, he acknowledged there could be “teething problems” in the first days after the introduction of the Goods and Services Tax (GST), but maintained confidence in it coming into effect by July 1, and September at the very latest.
“We’ll have to learn to live with it,” he said.
Personnel are being trained for it, he said, and the IT network prepared.
“But in any great experiment of this kind it is likely to be there...it will be a far more efficient system,” he said.“It will ensure evasion doesn’t take place. Every limb of a transaction would be captured in software and the quantum of taxes will go up — and as the taxation base increases, the state’s ability to make taxes more reasonable will be there.”
Asked about the health of the banking sector, and particularly non-performing loans in the state banks, he said the current quarter is looking better and that it is best to focus on the future, rather than “panic.”
The problems are confined to a particular few sectors and the Centre has taken steps to address the issue, he added.
He further said that there are calls for the creation of a “bad bank” or public sector agency to address the issue. “We are looking at several options on the table.”
The Indian economy is growing strongly and remains a bright spot in the global landscape despite temporary setback due to demonetisation, a senior IMF official has said.
In its annual country report on India, the International Monetary Fund (IMF) yesterday said growth is expected at 6.6 percent in this fiscal year and at 7.2 percent in the following year.
"The Indian economy is growing strongly and remains a bright spot in the global landscape," the IMF mission chief for India, Paul Cashin said.
Cashin said the halving of global oil prices that began in late 2014 boosted economic activity in India, further improved the external current account and fiscal positions, and helped lower inflation.
In addition, continued fiscal consolidation, by reducing government deficits and debt accumulation, and an anti-inflationary monetary policy stance have helped cement macroeconomic stability, he added.
Noting that the government has made significant progress on important economic reforms, which will support strong and sustainable growth going forward, Cashin said the upcoming implementation of the goods and services tax (GST) will help raise India's medium-term growth to above 8 percent.
GST will enhance the efficiency of production and movement of goods and services across Indian states, he said.
However, there is little scope for complacency.
"A key concern for us is the health of the banking system, which is still dealing with a large amount of bad loans, and also heightened corporate vulnerabilities in several key sectors of the economy," he said.
Responding to a question on demonetisation, he said the strong shortage of cash has disrupted economic activities.
However, he said the Indian Government appears to have that taken measures to alleviate payment disruptions, such as temporarily allowing use of old banknotes for purchases of fuel and agricultural inputs, have helped mitigate the negative impact.
"So we expect the slowdown to be limited and relatively short-lived and the financial system to come through unscathed. Of course, potential loan repayment risks should be monitored carefully, particularly given an already elevated level of non-performing loans," Cashin said.
LONDON: Visiting Indian Finance Minister Arun Jaitley opened trading on the London Stock Exchange on Monday in the presence of British Member of Parliament and UK Secretary of State for International Trade Liam Fox, India's High Commissioner to the United Kingdom Y.K. Sinha and Pankaj Patel, President, FICCI.
Following the market open ceremony, Nikhil Rathi, CEO, London Stock Exchange plc hosted a roundtable event with Minister Jaitley, delegates from the Federation of Indian Chambers of Commerce and Industry, Fintech companies and leading investors to discuss London’s significant role as a partner to India, supporting the country to develop its FinTech ecosystem and deliver key Indian priorities like infrastructure development, sustainable energy investment and the growth of smart cities.Rathi said, “Minister Jaitley’s second visit to the UK in a year underlines the success of the business and financial partnership between the UK and India and builds on recent landmark visits by Prime Minister Theresa May to India and Prime Minister Modi to the UK. We’re honoured once again to welcome Minister Jaitley to open trading on our historic markets. 2016 was a tremendous year for Masala bonds in London, with the Indian corporate Masala bond market launching in London with HDFC’s landmark bond issuance in July 2016, cementing London Stock Exchange’s clear position as the leading global venue for offshore Rupee denominated fundraising."
He further stated,“India’s growth trajectory is truly remarkable, with the highest growth rate among the G20 economies and the Minister’s Union Budget announced earlier this month will only spur this on. With the depth, liquidity, multicurrency and profile of London’s markets, together with the UK remaining the largest G20 investor in India, London Stock Exchange is ideally suited to partner with India in this extraordinary growth story to deliver key Indian priorities like infrastructure development, sustainable energy investment and the growth of smart cities.”
Dr. Liam Fox said, "The UK-India investment relationship is hugely important. India is now the third largest investor and second largest job creator in the UK; the UK is the largest G20 investor in India and plays an important role in building skills in the Indian workforce.
The UK Government is committed to deepening this relationship further and in my first months as Secretary of State for International Trade, I’ve been lucky enough to visit India twice - most recently accompanying the Prime Minister on her first bilateral visit outside Europe, as well as her first trade delegation. In the words of Prime Minister Modi, India and the UK are an ‘unbeatable partnership’. And I’m very glad that our Prime Ministers recently committed to ‘building the closest possible commercial and economic relationship’.”
Prime Minister Malcolm Turnbull and Israeli Prime Minister Benjamin Netanyahu signed the agreements ahead of ministerial meetings in Sydney on Thursday.
Both leaders said they were keen for their countries to expand their business and trade ties.
Mr Turnbull said the agreement on technological innovation and research would provide a framework for Australian scientists and businesses to create industries of the future with the help of Israel's well-established hi-tech community.
The air services agreement, which compliments a separate deal signed between Qantas and Israeli carrier El Al, would help foster business ties by making travel easier.
"There are a number of Australian businessmen and women who are investing in innovative technology-based industries between Israel and Australia," Mr Turnbull said at the start of the ministerial meetings, which included Treasurer Scott Morrison, Defence Minister Marise Payne, Environment Minister Josh Frydenberg and Deputy Prime Minister Barnaby Joyce.
"We want to deepen that.
"The air services agreement is part of that. There's no substitute for people getting together.
"We should be doing a lot more together. We shouldn't allow the tyranny of distance in the 21st century (to prevent that).
"There's so much scope for co-operation."
Two-way trade between Israel and Australia is worth about $1.2 billion each year.
Mr Netanyahu said he would like to see that double or tripled, and he believed Australia could act as a gateway for Israeli businesses wanting to expand into Asia.
"If I can schlep here, they can too," he told the ministerial roundtable meeting.
"I can testify it ain't bad."
Mr Netanyahu said it was vital countries like Israel and Australia co-operated to develop technology to "fight the barbarians" in the Middle East.Countries like Israel and Australia needed to "repel danger and seize opportunities", he said.
"We are working ... with other like-minded states to prevent terrorist attacks.
"This half century will be dominated by progress and freedom, not renegade barbarism."
In a joint statement the leaders said they were concerned about security challenges in the Middle East and emphasised the need for strengthening international co-operation to tackle terrorism.
In a joint statement, both Mr Turnbull and Mr Netanyahu expressed concern about recent ballistic missile tests by Iran and called on the country to implement its obligations under a UN Security Council resolution.
The leaders were also worried about Iran's support for Islamist militant group Hezbollah.
The comments on Iran come after Australia recently restored relations between Canberra and Tehran and began to explore trade opportunities with each other.
Security and terrorism as well as ways Australia and Israel could work together on cyber security have featured heavily in talks between the two leaders during the past two days.
The prime ministers also committed to explore opportunities for future collaboration in the areas of agriculture, water, energy and environmental protection.