By Sanjeev Sanyal The prime minister has set out a clear vision for a $5 trillion economy by 2024-25, a nominal GDP of Rs 375 lakh crore. In turn, this requires sustaining a real GDP growth rate of 8% a year. What are the ingredients of a model that can generate such growth? The overwhelming evidence, especially from East Asia, is that such high growth rates have only been sustained by an economic model driven by a virtuous cycle of savings, investment and exports supported by a favourable demographic phase. As discussed in the latest Economic Survey, India has already entered a period with a high share of workingage population, & will remain in this ‘demographic dividend’ phase for over two decades. However, favourable demographics is not sufficient. Broth for Growth Cross-country data shows that sustained high growth has always been driven by investment. Indeed, a GDP growth rate of 8% will typically require an investment effort in excess of 35% of GDP. … [Read more...] about View: Improving legal system is the best investment India can make
4 concerns about foreign investment
India has decided to retain the flexibility to have more stringent provisions its bilateral tax treaties to be able to curb tax abuse more effectively. This will allow New Delhi to negotiate limitation of benefit clause like the one it has in tax treaty with Singapore to restrict treaty advantages to genuine investors. Conditions such as a minimum level of investment, listing on the local stock exchange, ceiling on turnover and minimum expenditure, local residents on board, number of board meetings for carrying out operations in one of the contracting states can be imposed on investors to prevent tax abuse. Tax treaties have been used by third country investors to route their investments to lower tax liability or by local investors to round-trip funds. India had faced the issue under its tax treaty with Mauritius, which was amended in 2016. New Delhi has submitted its instrument of ratification for Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base … [Read more...] about India retains flexibility to have more provisions in its bilateral tax treaties to address tax concerns
Workers work at a Samsung plant in Vietnam. Photo: T.V.N. / Tuoi Tre Despite some companies’ willingness to charter private flights to bring their experts to Vietnam to ensure COVID-19 safety, they are told to wait for another two weeks, the representative complained. … [Read more...] about Firms face maze of regulations getting key foreign experts into Vietnam
Kunlun is one of China’s largest mobile gaming companies. It acquired a majority stake in Grindr in 2016 for $93 million and bought out the remainder of the company in 2018. It did so without submitting the transactions for CFIUS review. … [Read more...] about China’s Kunlun says U.S approves sale of Grindr to investor group
HONG KONG: Bankers and investors fear China's push to impose national security laws on Hong Kong threaten the city's future as an international financial centre. If it gets to that stage, Beijing's move will come at a cost for China's economy. WHY DOES CHINA NEED HONG KONG AS IT IS? China still has extensive capital controls and often intervenes in its financial markets and banking system. Hong Kong is one of the world's most open economies and one of the biggest channels for equity and debt financing. The size of Hong Kong's economy may only be the equivalent of 2.7% of mainland China's, down from 18.4% in 1997 when it reverted to Chinese rule, but the territory punches above its weight due to world-class financial and legal systems. As a gateway between China and the West, Hong Kong attracts global capital for China more efficiently than its other cities. HOW IS THAT CHANGING? Under the 'one country, two systems' formula agreed as part of Britain's handover of the territory … [Read more...] about How important is Hong Kong to China as a free finance hub?