India eyes bigger infrastructure investment

The new Indian government hopes that foreign direct investment will help to improve infrastructure and lift a sluggish economy. (AP)
Updated 07 July 2019

India eyes bigger infrastructure investment

  • Finance minister promises money for aviation, media and insurance

NEW DELHI: Indian Prime Minister Narendra Modi’s government proposed heavy investments in infrastructure, the digital economy and job creation to lift a sluggish economy burdened with a 45-year-high unemployment rate of 6.1 percent. Unveiling a draft budget after a major victory in national elections, Finance Minister Nirmala Sitharaman proposed a bigger role for foreign direct investment in aviation, media and insurance.
The government set a target for the economy to grow to $5 trillion by 2025 from the present $2.7 trillion. Sitharaman said it would reach $3 trillion by March next year.
She told Parliament that India’s economy is now the sixth largest in the world. In terms of purchasing power parity, it is the third largest after the US and China, she said.
She also announced cash handouts for small farmers, a pension scheme for informal workers and a doubling of tax relief for the lower middle class.
Small farmers would be paid 6,000 rupees ($85) annually, benefiting as many as 120 million households. About 30 million retail traders and small shopkeepers with annual incomes of less than 15 million rupees would get pension benefits, she said.
The budget doubled income tax exemptions for those earning up to 500,000 rupees a year from the existing 250,000 rupees. The decision would benefit 30 million lower-earning taxpayers. Raising taxes on the rich people, Sitharaman announced a 3 percent increase for those with an income between $292,000 — $730,000 a year and a 7 percent increase for those with an income above $730,000.
Currently, India imposes a 10 percent surcharge where total income is between 5 million and 10 million rupees and 15 percent on income above 10 million rupees.
At the same time, she reduced corporate tax to 25 percent from 30 percent for companies that have an annual turnover of up to $58 million. This would include 99.3 percent of companies in India and boost profits for a large number of them and stimulate investments, she said. 

FASTFACT

$5T - The Indian government has set a target for the economy to grow to $5 trillion by 2025 from the present $2.7 trillion.

Sitharaman said foreign direct investment in aviation, media and insurance could be opened further after multi-stakeholder examination. Also, insurance intermediaries could receive 100% foreign direct investment. India at present allows 49 percent foreign ownership in the insurance sector. She also said that local sourcing norms of 30 percent would be eased for foreign direct investment in the single-brand retail sector, a demand put forward by several multinational companies. India currently requires investors to source locally 30 percent of the value of goods purchased.
“These companies will certainly have to relook at their strategy
to tap the large Indian consumption potential. It would now be a race for all these retail companies to evaluate the conditions and take a quick decision to invest into
India,” said Anil Talreja, an industrialist. The finance minister said foreign direct investment in India has remained robust despite global headwinds. India’s FDI inflows in 2018-19 were around $64.375 billion, a 6 percent increase over the previous year.
Modi said the budget would accelerate the pace of development, rationalize the tax structure and modernize the country’s infrastructure.
The government will invest 1 trillion rupees ($15 billion) in infrastructure over the next five years, Sitharaman said.
She also said the government will raise 1.05 trillion rupees through disinvestment in government-owned companies in 2019-2020.
The government also earmarked 100 billion rupees for creating the infrastructure to promote electric cars in the country.


Greek town bets on slow tourism to overcome virus

Updated 12 August 2020

Greek town bets on slow tourism to overcome virus

  • The pandemic is an opportunity to promote alternative tourism, fishing tourism

PREVEZA, Greece: Yannis Yovanos scans the waters of the Ambracian Gulf with his binoculars for dolphins shooting into the air before curving back down into the sea.

His early warnings prompt just a dozen tourists on the deck of Yovanos’ small boat to scramble for their smartphones, hoping to secure a snap of the aquatic mammals’ aerial acrobatics.

Officials in his home town of Preveza hope that it’s just this kind of small, family-run business that will help them overcome the coronavirus’ impact on travel — while sparing the region the environmental impact and economic distortions of the mass tourism more common on Crete or the Ionian islands.

“We don’t want to stay all day on a beach, we’re looking for a different experience,” said Dutch tourist Frederika Janssen.

“The pandemic is an opportunity to promote alternative tourism, fishing tourism,” as well as local life and culture “directly related to the natural resources that date from Antiquity,” said Constantin Koutsikopoulos, who heads the agency charged with managing the Ambracian Gulf.

Inside the gulf is a protected wetlands park, some 400 sq. km that is one of Europe’s Natura 2000 wildlife diversity regions.

One hundred and fifty dolphins, loggerhead sea turtles and 300 species of aquatic birds including the rare Dalmatian pelican live in the lagoons and reed beds of the gulf.

Nestled between green hills, the Ambracian Gulf is fed by rivers descending from the mountains of the Epirus region of northwestern Greece.

Yovanos’ hometown guards the little strait that connects the gulf with the Ionian Sea.

Dolphin watching trips like these mean “I am realizing my dream of living the life of a fisherman among our natural riches,” said the 49-year-old from behind a greying beard.

For Greece as a whole, a gamble on reopening its borders to tourists as early as June appears to have paid off for now.

New coronavirus cases have appeared only slowly since then, with fewer than 6,000 cases and just over 200 deaths nationwide from the pandemic.

Although Preveza has opted for a slower, more family-oriented approach to travel compared to better-known Greek destinations, it hasn’t renounced Mediterranean holiday clichés altogether.

With the sector suffering a big hit from the coronavirus epidemic, Preveza city officials launched a promotional campaign, securing the title of safest place for a European beach holiday from website European Best Destinations.

“Monolithi beach, the main beach of Preveza, is ... the longest one in Europe... you won’t have to struggle to get a nice spot, fix your beach umbrella and spend relaxing days in the sun,” it wrote.

And new infrastructure in the shape of a marina has helped draw sailors away from packed ports on the islands.

“Preveza is the right place compared to Corfu which is a very nice island but very crowded,” said Nick Ray, a British businessman, from the deck of his yacht that had put into the town’s port.

With its fishing and fish farming, the Ambracian Gulf is already the region’s economic motor.

Sustainable, environment-focused tourism should give the authorities even more reason to deal with the threats to the gulf such as pollution, poaching and illegal fishing.

There’s even something for ancient history buffs in the ruins of Nicopolis, founded by Caesar Augustus in honor of his naval victory nearby in 31 BC, where some Roman mosaics are still preserved.