6-Sep-2019: India extends $1 billion line of credit for Russia’s Far East
Launching India’s “Act Far East” policy, Prime Minister Narendra Modi announced USD 1-billion line of credit for the development of Russia’s Far East — this is the first-ever region-specific line of credit in a foreign country extended by India.
Modi, who was speaking at the plenary session of the 5th Eastern Economic Forum (EEF) in Vladivostok, said that while India has an Act East policy to engage with South-east Asia, this will be the “take-off point” for the Act Far East policy. For the development of the Far East, India will give a line of credit worth $1-billion. My government has actively engaged in East Asia as part of its ‘Act East’ policy… I am confident that this step will give new impetus to the development of economic diplomacy and the growth of ties between the regions of our friendly states. We will remain active partners in our priority cooperation.”
Russia’s Far East is sparsely populated but is rich in resource and Delhi’s new policy aims to tap the region for the resources and also find opportunities for skilled workers to find employment in this region. It also ties in well with the Indo-Pacific concept, and opens up possibilities for using the Arctic route to connect with northern Europe.
Modi said that immediately after receiving Putin’s invitation to attend the Eastern Economic Forum, the Indian side began to prepare “very seriously”. “For this, Commerce Minister of India, Chief Minister of 4 states and more than 150 businessmen came to Vladivostok. Meeting with the special envoy to Far East and all 11 Governors of Far East have given very good results. Relations between states and regions found a framework. And coal, diamond, mining, rare earth, agriculture, timber, pulp & paper and tourism have revealed many new possibilities. And now a maritime route between Chennai and Vladivostok has also been proposed to increase connectivity between the regions”.
India’s connection to Russia’s Far East go back a long way. India was the first country to open a consulate in Vladivostok. Russia’s Far East deepens the bond between Russia and Asia.
28-Aug-2019: One country Two systems policy
As per the policy, the Hong Kong and Macau Special Administrative Regions, both former colonies, can have different economic and political systems from that of mainland China, while being part of the People’s Republic of China.
It was proposed by Deng Xiaoping with an aim to unify China and Taiwan. On December 19, 1984, China and the U.K. signed the Sino-British Joint Declaration in Beijing, which set the terms for the autonomy and the legal, economic and governmental systems for Hong Kong post 1997.
Similarly, on March 26, 1987, China and Portugal signed the Joint Declaration on the Question of Macau in which China made similar promises for the region of Macau after it was handed over to Beijing.
Hong Kong returned to Chinese control on July 1, 1997, and Macau’s sovereignty was transferred on December 20, 1999. Both regions became Special Administrative Regions of China. The regions would have their own currencies, economic and legal systems, but defence and diplomacy would be decided by Beijing. Their mini-Constitutions would remain valid for 50 years — till 2047 for Hong Kong and 2049 for Macau. It is unclear what will happen after this term.
In recent years, there has been a growing outcry from Hong Kong’s pro-democracy civil society against China’s alleged attempts to erode the city’s autonomy. This has created tensions between the city’s youth and the local government, which is effectively chosen by Beijing.
29-May-2019: Why US has removed India from its currency monitoring watchlist?
The Donald Trump administration has removed India from its currency monitoring watchlist. In its semi-annual foreign-exchange report to the US Congress, the Treasury Department did not mention India’s name in its watchlist of countries with potentially “questionable” foreign exchange policies and currency “manipulation”.
India, alongside China, Japan, Germany, Switzerland and South Korea, was placed in the bi-annual currency watch list in October last year. While India and Switzerland have not been mentioned in the latest list, the US has added Ireland, Italy, Malaysia, Singapore and Vietnam to the list, with China continuing to figure in it. While the designation of a country as a currency manipulator does not immediately attract any penalties, it tends to dent the confidence about a country in the global financial markets.
Countries with a current-account surplus equivalent to 2 per cent of gross-domestic product are eligible for the list, according to modifications made in the new list, down from 3 per cent earlier. Other thresholds include repeated intervention in the currency markets and a trade surplus with the US of at least $20 billion
Tweaks in currency policy has been used by the Trump administration to browbeat countries that, from Washington’s perspective, have hurt American businesses and consumers. For India, this comes amid the ongoing trade spat between Washington and New Delhi. Trump has repeatedly claimed that India is a “tariff king” and imposes “tremendously high” tariffs on American products, while also dismissing as “inadequate” the Indian government’s decision to halve the import tariff on Harley-Davidson motorcycles from 100% to 50% last year, even as he has maintained that his administration is “fixing broken trade deals” to protect American workers.