MAKE IN INDIA: Bonded Manufacturing

India allows manufacturing and other operations in a bonded manufacturing facility

With the Government’s continuous efforts to promote India as the manufacturing hub globally and the commitment towards ease of doing business, another initiative in this direction by the Central Board of Indirect Taxes (CBIC) is allowing import of raw materials and capital goods without payment of duty for manufacturing and other operations in a bonded manufacturing facility.

When the raw materials or capital goods are imported, the import duty on them is deferred. If these imported inputs are utilised for exports, the deferred duty is exempted. Only when the finished goods are cleared to the domestic market, import duty is to be paid on the imported raw materials used in the production. Import duty on capital goods is to be paid

Waste to Wealth

As the Swachh Bharat Abhiyan movement swept the nation, India uncovered its path to a cleaner, more sustainable future.

In line with India's declaration in the Paris Accord, the next stride in this direction aims to overstep waste & pollution management, transforming these menaces into productive avenues of energy and growth.

The Swachh Bharat Unnat Bharat Abhiyan, set up under the Prime Minister’s Science, Technology & Innovation Advisory Council, is an initiative by the Office of the Principal Scientific Advisor to the Government of India (the O/o PSA) that will leverage global technological capabilities to create socio-economic benefits for 1.3 billion Indians by addressing the issues of waste disposal, deteriorating air quality and increasing pollution of water bodies.

To help achieve India’s commitments to United Nations - Sustainable Development Goals, the Office of the PSA has established a 'Project Management Unit' (PMU) in partnership with Invest India, if and when the capital goods are cleared to the domestic market.

Note the raw materials or capital goods are imported, the import duty on them is deferred. If these imported inputs are utilised for exports, the deferred duty is exempted. Only when the finished goods are cleared to the domestic market, import duty is to be paid on the imported raw materials used in the production. Import duty on capital goods is to be paid if and when the capital goods are cleared to the domestic market *When finished goods are exported, in addition to the waiver of BCD + IGST on the imported goods used, the GST on the finished goods can be zerorated.

Financial Investor Initiative

India received $209 bn in private capital investments between

India’s National Investment Promotion & Facilitation Agency.

The PMU has identified 14 'Sentinel Sites' for its pilot projects across the country through the nodal regional Project Management Units. Each pilot project will be managed by an identified professional implementing agency with a demonstrated track record of expertise and operational success, drawing on the technical and professional expertise of various academic and R&D institutions collocated near the sentinel sites.

The pilot projects will seek to discover, demonstrate, test and learn from different waste to wealth techniques & approaches in collaboration with various departments & ministries. The deployment data, as well as the management lessons generated from each project, will be replicated at various sites across India.

2014-2020; with inflows of $62.2 bn in 2020 in comparison to $592 bn institutional investment globally.

India focused funds have been able to generate higher returns at 14.4% when compared to other markets in Asia. Over the last five years, key sectors such as infrastructure, eCommerce and financial services have attracted the highest investment from institutional investors.

Industry Scenario

PE deal value has continued to increase, while deal count has plateaued since 2015.

The deal value has doubled from $17.6 Bn spread over a number of deals depicting growing maturity in the deal ecosystem.

Over the last few years, some of the top deals were anchored by government funds because of the patient capital opportunities in the market with a favourable return. With sovereign and pension funds like GIC, Abu Dhabi Investment Authority (ADIA) and Canada Pension Plan Investment Board (CPPIB) allocating billions of dollars towards Indian investments, funds are certainly expected to rise in 2020; with Brookfield becoming the largest private investor in India in 2019.

Industry Highlights

12 lots of highway bundles of over 6,000 km to be monetized by 2024

Sovereign Wealth Funds to get 100% tax exemption on their interest, dividend, and capital gain incomes for investments made before 2024 in infrastructure and other notified sectors

Part of LIC to be privatized through an IPO

Established funds in Asia and India averaged an IRR of 11.9% and 14.4% respectively. This provides a good benchmark for investors

Disinvestment of BPCL and Concor – setting the ground for strategic sale programme

Modes of Investment- FDI, FVCI, FPI, REITs, INvits, AIFs

SAHYOG-Invest India’s Social Impact Initiative

Overview

SAHYOG, the Social Impact Initiative of Invest India, endeavours to ensure that the Invest India team is an active, positive contributor to society. By undertaking philanthropic projects that aim at creating awareness about social issues and impact at the grassroot level, we ensure that Invest India remains a socially conscious organisation.

The CSR Network

"Connecting your business to a cause"

The CSR Network connects interested individuals and companies looking to boost their CSR portfolio through investment to viable projects in rural India. Acknowledging that most CSR activities are conducted at the grassroot level in India, which are often unorganized and difficult to maneuver, we have created this portal to assist in the identification and implementation of such initiatives. Through the assistance of state governments and other governmental organizations this portal has identified and listed projects across multiple sectors to help facilitate this process.

India Investment Grid

India Investment Grid (IIG), an initiative of the Government of India showcases the best of opportunities across states and sectors in India on a single dynamic platform. A tool to enhance the Ease of Doing Business (EoDB), IIG helps in directly connecting potential investors and promoters. IIG also exclusively hosts the National Infrastructure Pipeline (NIP), is a first-of-its-kind, whole-ofgovernment exercise to provide world-class infrastructure to citizens and improve their quality of life. It aims to improve project preparation and attract investments into infrastructure, with real-time tracking on the ground. The portal also hosts 3,000+ Stressed Assets projects and 750+ CSR opportunities, curated directly from states.

India Investment Grid (IIG) is an initiative of the Department for Promotion of Industry and Internal Trade (DPIIT), Ministry of Commerce & Industry, Government of India, and Invest India.

Start Up India Hub

It empowers Startup ventures to boost entrepreneurship, economic growth, and employment across India!

The Startup India initiative was launched on 16th January 2016, by the Hon’ble Prime Minister. The Prime Minister unveiled an Action Plan, which consists of 19 Action Points that act as a guiding document for the initiative. Since the inception of the initiative:

Over 50,000 startups have been recognised with the Government

These startups are spread over 623 districts from 30 States and 7 Union Territories of India

A ₹10,000 Cr ‘fund of funds’ is being managed for growing the domestic venture capital industry

A ₹1,000 Cr Startup India seed fund has been launched in 2021 to aid setting up and growth of new startups

Creation of 5.2 lakh jobs across the country, with 45% of them having a base in Tier 2 - Tier 3 cities

India is the largest in number of startups being added every hour (4 startups/per hour), 3rd largest in number of startups and the 3rd largest unicorn community

32 Regulations simplified for startups – including Angel Tax

Over 220 Income Tax ExemptionsOver 250 SIDBI Fund of Funds

Atmanirbhar Abhiyan (Self-Reliant India)

Atmanirbhar Bharat Abhiyaan or Self-reliant India campaign is the vision of new India envisaged by the Hon'ble Prime Minister Shri Narendra Modi. On 12 May 2020, our PM raised a clarion call to the nation giving a kick start to the Atmanirbhar Bharat Abhiyaan (Self-reliant India campaign) and announced the Special economic and comprehensive package of INR 20 lakh crores - equivalent to 10% of India’s GDP – to fight COVID-19 pandemic in India.

The aim is to make the country and its citizens independent and self-reliant in all senses. He further outlined five pillars of Aatma Nirbhar Bharat – Economy, Infrastructure, System, Vibrant Demography and Demand. The Finance Minister further announces Government Reforms and Enablers across Seven Sectors under Atmanirbhar Bharat Abhiyaan.

The government took several bold reforms such as Supply Chain Reforms for Agriculture, Rational Tax Systems, Simple & Clear Laws, Capable Human Resource and Strong Financial System.

Schemes for MSMEs in India- Promoting Manufacturing in India

Under the Chairmanship of Hon’ble Prime Minister Shri Narendra Modi, the Ministry of Micro, Small and Medium Enterprises (MSME) implements

various programmes/ MSME schemes for the development and promotion of MSMEs across the country.

Moreover, the Government of India has been really proactive to ensure that all the benefits of these MSME schemes reach the MSMEs in time. To provide immediate relief to the MSME sector, various announcements (in addition to the various MSME schemes) have been made under the Atmanirbahar Bharat Package. The most important ones also included:

INR 3 lakh crore collateral-free automatic loans for MSMEs to buy raw material, meet operational liabilities and restart businesses

Revision of MSME definition to extend maximum benefits to the sector

Disallowing global tenders in procurements upto INR 200 cr to create attractive opportunities for domestic players

Clearing of MSME dues by the Government and Public Sector Units (PSUs) within 45 days

Source: Invest India, Government of India