Cyprus was blacklisted by the Indian tax authorities in 2013 for not providing important tax information requested by the Indian tax authorities under the Double Taxation Treaty. Cyprus was classified as a 'notified jurisdictional area'. As a result of this, all payments made to Cyprus attracted 30% withholding tax (previously 15%) and those receiving money in India from a person or entity located in Cyprus were required to disclose adequate information regarding the source of funds.
The above measures made investments between the two countries limited.
The removal of Cyprus from India's blacklist came after both countries agreed to changes in the Double Taxation Avoidance Agreement.
On the 18th of November 2016 India and Cyprus have signed the amended bilateral tax treaty under which capital gains arising from sale of shares on investments made by Cyprus companies will be taxable at the applicable domestic tax rate.
With the signing of the amended Double Taxation Agreement, the Indian Tax Department made a decision to rescind the three year old order blacklisting Cyprus as a notified jurisdictional area with effect from the date of issue, thus removing Cyprus from its blacklist of countries with insufficient information exchange.
H.E. Mr. Nicos Anastasiades, President of the Republic of Cyprus is currently on a State Visit in India. During his official visit he will meet with the President of India, with ministers and other highly ranked government officials and will sign a number of bilateral agreements and Memorandum of Understandings in diverse fields.
Cyprus and India enjoy strong economic ties. Cyprus is the 8th largest foreign investor in India (with cumulative foreign direct investment of above USD 9 billion) having invested in manufacturing industries, cargo handling, shipping and logistics, financial leasing, stock exchange and real estate.
The new double tax avoidance treaty will further strengthen the economic ties between the two countries and open the door for substantial business development and cooperation in diverse fields.
It is not just Coal India which is planning a global foray by acquiring coal assets abroad with listing on the London bourse. Its trade unions, too, appear to be keen on having global exposure which may help them learn and adapt better to changing business dynamics.
Coal India’s largest trade union, Indian National Mineworkers’ Federation (INMF), which enjoys support of more than 40 per cent of the workers is attending the IndustriALL Global Union (IGU) conference in Geneva. The members attending the conference are there to interact with global trade union leaders. They wish to draw upon global trade union leaders’ experience and come up with a sustainable industrial policy for the coal workers and improvise on organisational capabilities.
The IGU conference is going to focus on five large areas which include building a strong union for the mineworkers, both at the national as well as global levels, and defending workers’ rights in the fast changing mining among other issues. “Mechanisation of the mines and digitisation of the company as well as the coal sector has now become imminent. Under a scenario when Coal India is thinking of a global presence, we (trade unions) also need to think on similar lines and keep pace with changing business dynamics,” S. Q. Zama, secretary general of INMF told Business Standard before leaving for Geneva.
As per Zama, Coal India's initial talks with officials from the London Stock Exchange is an indication of the company's intent to raise foreign funds and make its presence felt across Western Europe. Also, the company’s other central trade unions (CTUs) like All India Coal Workers Federation, Indian Mine Workers’ Federation (IMWF) and others view the company's move to acquire coal assets abroad as intent of imbibing increased mechanisation of the mines in the country. “We are not against mechanisation as we understand that it is needed to raise productivity. But we need to take into consideration the changing energy scenario as well which is moving towards renewable energy sources and need to understand the future of coal mining,” Ramendra Kumar, general secretary of IMWF said.
At the trade union congress in Geneva, INMF will be interacting with trade union leaders from 140 countries to discuss industry issues and the way forward. Further, it also hopes to implement a few of the takeaways from the Geneva conference in Coal India.
“The conference will analyse the transformation in digitisation and advance technologies and draw up a comprehensive role of the trade unions for future modern societies in light of structural diversities,” Zama said.
While the CTUs have called for a strike from June 19-21 to protest the Centre’s proposal to merge the Coal Mines Provident Fund (CMPF) with Employees Provident Fund (EPF) and the delay in revising wages of about 500,000 coal workers, a major contention point of the trade unions is over growing number of outsourced staff in the company.
Coal India, which was established in 1975 following nationalisation of coal mines, had 650,000 staff on its payroll, which fell to 333,000 in 2014 and has further come down to 326,000 following retirement and voluntary schemes.
As per the CTUs, as high as 52 per cent of the 492 mt coal mined during 2014-15 was carried out by contractual workers while this ratio is poised to increase to 55 per cent in the current financial year.
“Contractual employees accounted for nearly 40 per cent of the total production just five years back. It has now increased to over 55 per cent and is expected to go up in the days ahead,” Rajendra Prasad Singha, general secretary of Hind Khadan Mazdoor Federation said.
Source: Business Standard
India has been re-elected to the UN’s principal organ on economic, social and environmental issues for another three-year term. India was among 18 nations to win election to the Economic and Social Council (ECOSOC).
India obtained 183 votes, the second highest after Japan in the Asia Pacific category. Election to fill the 18 vacancies in ECOSOC was held yesterday, June 15. “Another day, another election… India wins again. Thanks to support of @UN Member States, India re-elected to ECOSOC (Eco & Social Council),” India’s Permanent Representative to the UN Ambassador Syed Akbaruddin tweeted.India’s re-election to ECOSOC came just a day after leading expert on international law Neeru Chadha won a crucial election to the International Tribunal for the Law of the Sea, becoming the first Indian woman to be elected as judge to the tribunal. Chadha got 120 votes, the highest in the Asia Pacific group and was elected in the first round of voting itself.
India was seeking re-election to ECOSOC as its current term is set to expire this year. Pakistan, whose term on the council is expiring this year, too was seeking re-election to the UN body but lost as it got only one vote.
Having obtained the required two-thirds majority, the nations elected members of ECOSOC for a three-year term beginning January 1, 2018 are Belarus, Ecuador, El Salvador, France, Germany, Ghana, India, Ireland, Japan, Malawi, Mexico, Morocco, Philippines, Spain, Sudan, Togo, Turkey and Uruguay. France, Germany, Ghana, Ireland and Japan were among nations seeking re-election.
ECOSOC, one of the six main organs of the UN, is the principal body for coordination, policy review, policy dialogue and recommendations on economic, social and environmental issues, as well as for implementation of the internationally agreed development goals.
The council’s 54 member governments are elected by the General Assembly for overlapping three-year terms. Seats on the council are allotted based on geographical representation with 14 allocated to African states, 11 to Asian states, six to Eastern European states, ten to Latin American and Caribbean states and 13 to Western European and other states.
Tesla Motors is planning to set up a factory in India to cater to the local demand for electric cars, at a time when the Modi government has launched an ambitious plan of moving to 100 per cent electric mobility by 2030.
The US carmaker is looking to enter India as a retailer and is in talks with the government for waiver of restrictions on imports of its high-end electric cars until its factory is built here.
“In discussions with the government of India requesting temporary relief on import penalties/restrictions until a local factory is built,” Elon Musk, chief executive officer, Tesla, said in a tweet on Thursday. He did not specify a time frame for the India venture.
The import penalties or restrictions that Musk referred to are most likely the norms for multinationals to set up single-brand retail in India, which mandate them to source at least 30 per cent locally.
Unlike traditional automakers, Tesla sells and services its vehicles on its own rather than through local dealers.
Even Apple has been trying to get India to waive its local sourcing norms temporarily. While in the past the government has indicated that it might make exceptions for high-tech products (presumably iPhones and Tesla cars), there has been no clarity yet.
Because of this, India’s current laws would mandate Tesla to set up a factory and begin sourcing components locally before even selling its first car here.
Last month, Musk had flagged this very issue while answering a query on Twitter about when the company would launch its business in India.
“Tesla always sells directly, but apart from asking for permission to sell directly, they might be looking for some concessions on the vehicles or the factory they want to set up. All these companies come looking for special packages,” said Abdul Majeed, partner, assurance at PwC India.
India does not restrict import of automobiles by wholesalers, but it levies a huge customs duty of 119 per cent on a CBU (completely built unit). This was done to force global luxury automakers, which were eager to tap India’s growing base of rich individuals, to set up local manufacturing and assembly units.
Over the past couple of years, this policy has largely worked, with brands such as Mercedes-Benz, Audi, BMW, JLR and Volvo having units in India.
Experts believe that the government should do the same even for electric vehicles as it will help boost the local industry.
Source: Business Standard
Assocham, a lobby of Indian industry, has urged the government to impress upon US President Donald Trump the extent of business activities carried on by American firms in India.
Assocham’s comments come in the wake of moves by Trump to cut down on what he calls the ‘misuse of H1b visa’ program. According to the American federal administration, Indian companies — by far the biggest recipients of visas meant for ‘specialized talent’ have been gaming the system by flooding the lottery system with applications.
The move could hurt the business model of Indian companies, who typically ship lower paid engineers from their home base to work in the offices of their American client corporations.
“If Indian IT firms have got a good foothold in the US, American top notch firms like Facebook, Google, Microsoft and Apple, Coke and Pepsi are getting quite a liberal market access in India without any restrictions,” Assocham said.
“In a technology driven and free market global economy, governed by rule-based multilateral World Trade Organisation, major trading partners should abstain from unilateral restrictions on flow of trade in goods and services. After all, the global economy is inter-dependent,” the chamber said, expressing concern over a host of restrictions on visa for Indian IT professionals in the US.
“It is a matter of concern that in the name of America First, restrictions are sought to be slapped on Indian IT firms, which are creating jobs in the US as well. Moreover, the software solutions the Indian firms develop for the world market are built around the platforms and tools of the American technology majors. Such a thing should be conveyed to the American President when our Prime Minister meets him during his impending visit to the US”, the ASSOCHAM Secretary General Mr D S Rawat said.
The ASSOCHAM said even in the IT services , it is not only the Indian firms like TCS and Infosys which are outsourcing to the American clients but scores of American companies which have set up huge centres in cities like Pune, Bengaluru, Gurgaon, Chennai and Hyderabad for their global clients. “Yes, they do create jobs for Indians, but also repatriate billions of dollars as profits and India is fine with it. Thus, it is absolutely unfair to target Indian firms which are facing increasing pressure in the US through different non-trade measures like visa fee and other unrelated levies”.
India runs its overall trade gap of over USD 105 billion in goods alone with rest of the world, being liberal with its imports which aggregated USD 380 billion in 2016-17 while exports were about USD 275 billion. “We give much more market access to the world than we enjoy elsewhere,” the chamber said, adding the US corporates are immensely benefiting by doing business with India and Indian companies and that must be conveyed to the US administration”.