Launch of Sino-Indian Digital Collaboration Plaza

The Sino-Indian Digital Collaboration Plaza (SIDCOP), an initiative to bring Indian IT companies and Chinese enterprises closer to each other on a single AI enabled platform was launched on 10th January 2019. This is a partnership by National Association of Software and Services Companies (NASSCOM) with Municipal Governments of Guiyang and Dalian. A Joint Venture comprising of one Indian and Chinese company has been tasked with the running of the platform.

About the SIDCOP:

The initiative aims to bring Indian IT companies and Chinese enterprises closer to each other on a single AI enabled platform. This platform will be managed by a joint venture comprising of one Indian and Chinese company.

The initiative aims to encash the expertise of Indian IT enterprises in business transformation and operational optimization by using IT tools in complex business environments.

It offers a boundary-less marketplace for Chinese enterprises in order to assist them in operational optimization and adopting industry best practices in business solutions by connecting with Indian enterprises.

National Association of Software and Services Companies (NASSCOM):

NASSCOM is a not-for-profit industry association and is the apex body for the Indian IT-BPM industry.

The membership of the NASSCOM is open for Companies registered in India and are focused on providing IT-BPM products and services.

NASSCOM aims to make sure that service quality and enforcement of Intellectual Property Rights have been properly implemented in the Indian software and BPM industry.

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India, Japan bilateral currency swap gets Cabinet nod

The Union Cabinet gave its nod to the $75-billion bilateral currency swap arrangement between India and Japan.

It may be recalled that this arrangement — another milestone in mutual economic cooperation and special strategic and global partnership between two countries — was concluded in October last year during summit-level meeting at Yamanashi, Japan between Prime Minister Narendra Modi and Japan’s Prime Minister Shinzo Abe.

The arrangement is expected to bring stability to foreign exchange and capital markets in India. It would also further strengthen and widen the depth and diversity of economic cooperation between the two countries.

The Union Cabinet also gave its approval for the MoU between India and Japan on the development of ‘advanced model single window’ to facilitate investments into India. It would be operationalized in Central and State Governments in India for taking administrative procedures necessary for business operations, and to develop a structure in which those procedures are completed in an expeditious manner, so as to accelerate India’s effort to promote Ease of Doing Business.

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India, Pakistan exchange lists of nuclear installations

India and Pakistan on Tuesday exchanged lists of installations covered under an agreement against attacks on nuclear facilities and lists of prisoners held in each other’s jails against the backdrop of a downturn in bilateral relations.

The exchange is done each year on January 1, under the Agreement on the Prohibition of Attack against Nuclear Installations and Facilities, also referred to as the Non-Nuclear Aggression Agreement.

About the Agreement on the Prohibition of Attack against Nuclear Installations:

  • The agreement, which was signed on December 31, 1988, and entered into force on January 27, 1991, provides that the two countries inform each other of nuclear installations and facilities to be covered under the pact on the first of January of every calendar year.
  • The need for the agreement had been felt against the backdrop of Israel’s 1981 bombing of Iraq’s Osirak reactor near Baghdad. The strike, carried out by Israeli fighter jets over hostile airspace, had set Iraq’s nuclear weapons programme significantly.
  • The agreement had also come at a time of deep anxiety for Pakistan. Islamabad had been rattled by the memory of the 1972 defeat which dismembered the country, and military developments in India, such as Operation Brasstacks in 1987, which was a wargame exercise to prepare for deep strike offensive capabilities. Pakistan had at the time responded by putting at its nuclear installations and assets on ‘high alert’.
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Indo-US 2+2 Dialogue

Joint statement on the inaugural India-U.S 2+2 Ministerial dialogue: Minister of External Affairs Smt Sushma Swaraj and Minister of Defence Smt Nirmala Sitharaman welcomed Secretary of State Michael R. Pompeo and Secretary of Defense James N. Mattis to India on September 6, 2018, for the inaugural India-U.S. Ministerial 2+2 Dialogue.

Celebrating over 70 years of diplomatic cooperation, the Ministers reaffirmed their view that India and the United States, as sovereign democracies founded on the values of freedom, justice, and commitment to the rule of law, must continue to lead global efforts to promote peace, prosperity, and security.

Strengthening the Defense and Security Partnership:

  • The Ministers welcomed the inclusion of India by the United States among the top tier of countries entitled to license-free exports, re-exports, and transfers under License Exception Strategic Trade Authorization (STA-1) and committed to exploring other means to support further expansion in two-way trade in defense manufacturing supply chain linkages.
  • They welcomed the signing of a Communications Compatibility and Security Agreement (COMCASA), facilitate access to advanced defense systems and enable India to optimally utilize its existing U.S. origin platforms.
  • The Ministers announced their readiness to begin negotiations on an Industrial Security Annex (ISA) that would support closer defense industry cooperation and collaboration.
  • After recognizing the recent bilateral engagements, the Ministers committed to starting exchanges between the S. Naval Forces Central Command (NAVCENT) and the Indian Navy, underscoring the importance of deepening their maritime cooperation in the western Indian Ocean.
  • Through the Defense Technology and Trade Initiative (DTTI), the ministers committed to prioritizing co-production and co-development projects to pursue other avenues of defense innovation cooperation. Further, they welcomed the conclusion of a Memorandum of Intent between the S. Defense Innovation Unit (DIU) and the Indian Defense Innovation Organization – Innovation for Defence Excellence (DIO-iDEX).
  • The Ministers announced to increase information-sharing efforts on known or suspected terrorists and to implement UN Security Council Resolution 2396 on returning foreign terrorist fighters.

Partners in the Indo-Pacific and Beyond:

  • The Ministers reaffirmed their shared commitment to a united, sovereign, democratic, inclusive, stable, prosperous, and peaceful Afghanistan. The two sides expressed their support for an Afghan-led, Afghan-owned peace and reconciliation process.
  • India welcomed the recent U.S. – North Korea summit. The two sides pledged to work together to counter North Korea’s weapons of mass destruction programs and to hold accountable those countries that have supported them.
  • The United States welcomed India’s accession to the Australia Group, the Wassenaar Arrangement, and the Missile Technology Control Regime and reiterated its full support for India’s immediate accession to the Nuclear Suppliers Group.
  • Both countries committed to further expanding and balancing the trade and economic partnership consistent with their leaders’ 2017 joint statement, including by facilitating trade, improving market access, and addressing issues of interest to both sides.
  • Thus, both sides welcomed the ongoing exchanges between the Ministry of Commerce of India and the Office of the United States Trade Representative and hoped for mutually acceptable outcomes.
  • Both sides looked forward to full implementation of the civil nuclear energy partnership and collaboration between Nuclear Power Corporation of India Limited (NPCIL) and Westinghouse Electric Company for the establishment of six nuclear power plants in India.
  • Observing the strong ties of family, education, and business, and the spirit of entrepreneurship and innovation that unite their people, the Ministers highlighted the unmatched people-to-people ties between their countries and recognized the benefits to both nations and the world from these ties, including the free flow of ideas and collaboration in health, space, oceans, and other areas of science and technology.
  • The next 2+2 meeting is to be held in the United States in 2019.
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CPEC has no military dimensions: Pakistan

China on dismissed as untrue a US media report that alleged that it has hatched a secret plan to build fighter jets and other military hardware in Pakistan as part of the USD 60 billion China-Pakistan Economic Corridor (CPEC) project.

About CPEC:

The CPEC is the flagship project of the multi-billion dollar Belt and Road Initiative (BRI), a pet project of Chinese President Xi Jinping, aimed at enhancing Beijing’s influence around the world through China-funded infrastructure projects.

The 3,000 km-long China–Pakistan Economic Corridor (CPEC) consisting of highways, railways, and pipelines is the latest irritant in the India–China relationship.

CPEC eventually aims at linking the city of Gwadar in South Western Pakistan to China’s North Western region Xinjiang through a vast network of highways and railways.

The proposed project will be financed by heavily-subsidised loans, that will be disbursed to the Government of Pakistan by Chinese banking giants such as Exim Bank of China, China Development Bank, and the Industrial and Commercial Bank of China.

But, why is India concerned?

It passes through PoK. Any Indian participation would inextricably be linked to the country’s legitimate claims on PoK.

CPEC rests on a Chinese plan to secure and shorten its supply lines through Gwadar with an enhanced presence in the Indian Ocean. Hence, it is widely believed that upon CPEC’s fruition, an extensive Chinese presence will undermine India’s influence in the Indian Ocean.

It is also being contended that if CPEC were to successfully transform the Pakistan economy that could be a “red rag” for India which will remain at the receiving end of a wealthier and stronger Pakistan.

Besides, India shares a great deal of trust deficit with China and Pakistan and has a history of conflict with both. As a result, even though suggestions to re-approach the project pragmatically have been made, no advocate has overruled the principle strands of contention that continue to mar India’s equations with China and Pakistan.

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Indian Firm Takes Over Operations of Strategic Iranian Port Chabahar

Over six weeks after getting a waiver from sanctions imposed by the United States, Indian state-owned joint venture India Ports Global Limited formally took over operations at Chabahar’s Shaheed Behesti port on Monday.

The Iranian port city was the venue on Monday for a meeting of officials from Iran, India, and Afghanistan, for the first meeting of the “follow-up committee” to operationalize the trilateral Chabahar agreement.

Where is Chabahar port?

Iran’s Chabahar port is located on the Gulf of Oman and is the only oceanic port of the country. The port gives access to the energy-rich Persian Gulf nations’ southern coast.

Why Chabahar port is crucial for India?

The first and foremost significance of the Chabahar port is the fact that India can bypass Pakistan in transporting goods to Afghanistan. Chabahar port will boost India’s access to Iran, the key gateway to the International North-South Transport Corridor that has sea, rail and road routes between India, Russia, Iran, Europe, and Central Asia.

Chabahar port will be beneficial to India in countering Chinese presence in the Arabian Sea which China is trying to ensure by helping Pakistan develop the Gwadar port. Gwadar port is less than 400 km from Chabahar by road and 100 km by sea.

With Chabahar port being developed and operated by India, Iran also becomes a military ally to India. Chabahar could be used in case China decides to flex its navy muscles by stationing ships in Gwadar port to reckon its upper hand in the Indian Ocean, Persian Gulf, and the Middle East.

With Chabahar port becoming functional, there will be a significant boost in the import of iron ore, sugar, and rice to India. The import cost of oil to India will also see a considerable decline. India has already increased its crude purchase from Iran since the West imposed a ban on Iran was lifted.

Chabahar port will ensure in the establishment of politically sustainable connectivity between India and Afghanistan. This will, in turn, lead to better economic ties between the two countries.

From a diplomatic perspective, Chabahar port could be used as a point from where humanitarian operations could be coordinated.

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Govt Extends Ban on Import of Milk Products from China for 4 Months

The government has further extended the ban on import of milk and its products, including chocolates, from China for four months till April 23 next year, according to a notification of the commerce ministry issued on Monday.

“Prohibition on import of milk, milk products (including chocolates, chocolate products, candies, confectionary food preparations with milk or milk solids as an ingredient) from China is extended for a further period of four months, till April 23, 2019, or until further orders,” the DGFT said in a statement.

The ban was first imposed in September 2008 and later extended from time to time.

The ban was imposed on apprehensions of the presence of melamine in some milk consignments from China. Melamine is a toxic chemical used for making plastics and fertilizers.

Though India does not import milk and its products from China, it has imposed the ban as a preventive measure.

India is the world’s largest producer and consumer of milk. It produces around 150 million tonne milk annually.

Uttar Pradesh is the leading state in milk production, followed by Rajasthan and Gujarat.

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7th round of India – South Korea CEPA negotiations held

The 7th round of India – South Korea Comprehensive Economic Partnership Agreement (CEPA) negotiations were held inSouth Korea between 11-13 December 2018.

The discussions were positive and subject to Indian sugar industry meeting the quality standards and specifications prescribed by the South Korean Government.

Background:

South Korea imports around 15 lac tones of raw sugar annually and the Indian sugar industry is making efforts to export raw sugar from India during 2018-19 sugar seasons.

India and South Korea will reduce duties on 11 tariff lines in a bid to expand bilateral trade by updating their existing free-trade agreement, called the Comprehensive Economic Partnership Agreement (CEPA).

In 2017-18, India exported goods worth $4.4 billion to South Korea while imports from the latter were worth $16.3 billion.

Difference between CECA and CEPA

CECA – Comprehensive Economic Cooperation Agreement

CEPA – Comprehensive Economic Partnership Agreement

The major “technical” difference between a CECA and CEPA is that CECA involve only “tariff reduction/elimination in a phased manner on listed/all items except the negative list and tariff rate quota (TRQ) items. CEPA also covers the trade in services and investment and other areas of economic partnership”.

So CEPA is a wider term that CECA and has the widest coverage.

Usually, CECA is signed first with a country and after that negotiations may start for a CEPA.

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India announces $1.4 billion aid to Maldives

India declared an aid of $1.4 billion to the Maldives. The financial package that was prepared over the last month was formally announced at a joint press conference held by President Ibrahim Mohamed Solih of the Maldives and Prime Minister Narendra Modi.

Mr Modi said both sides were connected by mutual faith in democracy and development. “Cooperation between our countries is necessary for maintaining stability in the Indian Ocean region and we are willing to take our bilateral relationship to its fullest extent.”

India would be there to support the Maldives in its human-oriented development plans. New Delhi would also support Male in improving connectivity links between the two nations.

In response, President Solih said his government would walk the path of cooperation and development. His discussion with India covered a wide swath of issues such as health, education, and defence, he noted.

India has agreed to a prime-ministerial visit to Male next year, he said.

Upon arrival, Mr Solih had thanked India and described it as the “closest friend” of his country.

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UK Puts On Hold Plans To Suspend ‘Golden Visa’, Sparks Controversy

In a U-turn, the UK government  put on holds plans to suspend “golden visa” category in reference to its use by super-rich foreign nationals, including Indians, to acquire fast-track settlement rights in Britain.

The Tier 1 Investor Visa, used by many high net-worth Indians over the years, was to be suspended from midnight last Friday over fears of its misuse.

They provide a faster route for wealthy investors coming from outside the European Union and Switzerland to settle in Britain. The program was introduced in 2008 to attract wealthy foreign nationals willing to invest large amounts of capital in Britain.

To qualify, foreign nationals must put down a minimum of 2 million pounds (around $2.5 million) as an investment in Britain. Such an investment in United Kingdom bonds, share capital or companies allows investors to apply for permanent residency within five years.

For a £5 million investment, they can apply for permanent residency after three years.

An investment of £10 million can open the door to permanent residency after two years. After that, the nationals theoretically could apply for citizenship.

Billions of pounds have poured into London over the past decade, following an influx of global elites who have benefited from the program. The visa program has always had its critics, with anticorruption campaigners railing against Britain’s openness to ill-gotten riches from overseas and the foreigners who invest them.

A survey found that the scheme brought limited economic benefits because most of the investors had bought fixed-interest loan securities known as gilts, meaning that they were effectively loaning the government money instead of investing in the country.

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