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Showing posts from December, 2018

Ease of Doing Business and States export performance

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Do business reforms lead to better export performance? Are there any other measure(s) that correlate with export performance by Indian states? We can measure merchandise export performance of states against Ease of Doing Business and also against the Logistics Ease Across Different States (LEADS) index for some preliminary understanding of the matter in Indian context. India has a Business Reforms score  that measures the individual states in terms of ease of doing business, on similar lines as that of World Bank's (WB) Ease of Doing Business (EoDB). This is to help identify the reforms required to make doing business easier. The score card - let's call it EoDB for the sake of the simplicity - is maintained for all states and union territories of India. LEADS index is relatively new. It has been created on the lines of World Bank's logistics performance index and covers various states and union territories of India. The 2018 report prepared by Deloitte for ministry of

November numbers for foreign trade - some points

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The November 2018 numbers for India's foreign trade are here . The summary for April-Nov 2018 is as shown in the figure below: Trade stats of India - Summary At this rate, we would end up with an annual deficit of around 192 Billion USD, a significant jump from a deficit of around 162 Billion USD during last financial year. The below are the numbers for last financial years imports listed in descending order of value of imports (excel online may take time to load). The first item in the list, the mineral fuels and oils, is a necessary need as India doesn't produce any oil. Out of the imported crude coming under this chapter, we refine and export around 38 Billion USD refined petroleum products. Thus the net deficit is around 94 Billion USD. This is the fuel oil bill for India every year. The second item in the list, the pearls precious stones and metal, mainly constitute of imports of diamonds and gold. India is the largest diamond polisher, and one of the bigge

Dhaka Vs Ranchi - a post GST scenario analysis of apparel imports

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Under the existing system of trade and indirect taxation prevailing in textile and garment sector, does it makes more sense for a Bangalore stockist of apparels to import from Dhaka in Bangladesh over buying from Ranchi? Here's the self explanatory calculation. Assumptions: Bangladesh usually sources fabric from China while an Indian supplier sources fabric from an Indian supplier based in Gujarat/other states. I shall assume that the price at the factory gate of fabric manufacturer for both Chinese and Indian fabric is same - usually Chinese fabric is cheaper. The transportation cost from China to Bangladesh is same as that from Gujarat/other states to Ranchi - usually Chinese transport cost would be smaller. I shall also assume, for sake of simplicity that labor cost in Bangladesh is same as that in Ranchi, while a ballpark analysis tells that Bangla labor is cheaper by 40% over Indian labor. (Excel online may take some time to load the table below - I shall be thankful an