UK plans tariff cut on Indian exports
THE £40 MN TARIFF CUTS COULD BE A PRECURSOR TO A BILATERAL FTA,
SAY UK OFFICIALS
nLONDON: Seen as a ‘building block’, the UK’S new Global Tariff (UKGT) schedule is expected to boost trade by reducing tariff on Indian exports by up to £40 million per year, as the Boris Johnson government plans a trade scale-up when Brexit is completed on December 31.
This and other key issues were discussed last week at the 14th bilateral annual meeting of the Joint Economic and Trade Committee (Jetco), which is usually less noticed but assumed importance given that it is the last such meeting before the UK begins trading as an independent country, post-brexit, from January 1.
Five sectors have been identified for enhanced focus with India: life science and health, information and communications technology, food and drink, chemicals and services. Bilateral trade is currently worth £24 billion, but India is not yet among the UK’S top 10 trading partners.
Officials say the idea is to build towards an eventual signing of a free trade agreement with India, which has often been mentioned by Prime Minister Boris Johnson and other probrexiteers as a key market.
Jetco, now in existence for 15 years, is the UK’S longest standing meeting of its kind. It was attended by commerce minister Piyush Goyal, minister of state Hardeep Puri, and international trade secretary Liz Truss and minister Ranil Jayawardena.
“The UK’S new Global Tariff (UKGT) schedule serves as a ‘building block’ towards an increasingly open trade partnership. Assuming all tariffs are levied, the UKGT could boost trade flows by reducing tariffs on Indian exports by up to £40 million per year’, a UK statement after the meeting said.
“Alongside this, UK companies have secured recognition and registration of polyhalite, a multi-nutrient fertiliser mined in the UK, which will enable UK exports and help Indian farmers to increase crop yields while supporting a cleaner, greener and sustainable environment”.
nMUMBAI: Private banks in India have turned extra cautious amid widespread business disruptions from the coronavirus pandemic, with the top lenders setting aside more than ₹17,000 crore in provisions fearing a surge in bad loans after the six-month loan moratorium ends in August.
HDFC Bank Ltd, Axis Bank Ltd, Bandhan Bank Ltd, Federal Bank Ltd and ICICI Bank Ltd have made aggregate provisions of ₹17,146 crore in the June quarter. The figure is 9.17% lower than the ₹18,876 crore set aside in the March quarter but marked a 67% rise from the year-earlier period. This is despite a declining trend in loans under moratorium seen in the past two months.
The Reserve Bank of India (RBI) allowed lenders to offer a six-month moratorium to borrowers in a bid to provide relief to businesses and people.
The RBI’S Financial Stability Report released on Friday said the bad loan ratio of banks is expected to climb to the highest level in more than two decades as a protracted lockdown has severely hit businesses and left millions of people jobless, impairing their ability to repay.
Non-performing assets at banks may rise 4 percentage points to 12.5% of advances by March 2021, the highest since FY2000, under the baseline stress scenario, RBI said in its report.
To be sure, lenders continue to be apprehensive even as the percentage of borrowers under moratorium has started to decline significantly in the second phase of the deferment with an increase in repayments.
Lenders say they are unclear on the amount of stress that could come to their books post August 31, after the end of the loan moratorium.