India a reliable partner for global supply chains

Question: I am told that there are substantial logistical issues at different ports in India. Is it due to larger volume of imports being made by the country? My company imports lots of goods from the Indian subcontinent and receiving deliveries from India is becoming a problem.

Answer: The main issue is that Indian exports are increasing by leaps and bounds creating logistical bottlenecks at ports. It is expected that merchandise exports from India by March 31, 2022 may cross $400 billion. This figure would be the highest ever achieved. Services exports are also well on track and are likely to touch $150 billion. The boost in merchandise exports is, to some extent, on account of India being used by multinational companies as a manufacturing hub for their products which are then exported from India. Foreign direct investment inflows have touched $27 billion from April to July this year. India is being looked upon as a reliable partner for maintaining the global supply chains.

Question: Are individual retail investors permitted to buy and sell Government securities? I am told that there is a lot of interest in investing in secured investments. If so, what is the procedure?

A: Government securities can now be traded online by small retail investors, both in the primary and secondary markets. For this purpose, it is necessary to open a gilt securities account which is called Retail Direct Gilt (RDG) account. This can be done if the investor has a rupee savings bank account in India and has been issued a permanent account number by the Income-tax Department. The investor will have to provide any KYC document, like Aadhaar number, passport number, driving licence number, etc. He should also provide his e-mail id and mobile number while opening the bank account. Once the account is opened, retail investors can buy government securities when government bonds are issued for the first time, or buy/sell existing Government bonds in the secondary market. For such trading, the person can access the secondary market transaction link on the online portal through NDS-OM. Before start of trading hours or during the day, the retail trader would be required to transfer funds to a designated account using netbanking. A funding limit would be provided for buying and at the end of the trading session excess funds lying to the credit of the investor would be refunded. The securities so purchased will be credited to the RDG account on the date of settlement.

Question: India has made a commitment at the Glasgow Climate Conference to reach net-zero emissions by 2070. Is this achievable or is it a pie in the sky?

A: By 2030 it is proposed to meet 50 per cdent of the electricity requirements through renewable sources. To do so, battery and smart grid installations will dominate the market. If this is achieved, it would be one of the most rapid decarbonisation of the electricity sector. For this, India would have to create an enabling environment for attracting investments and will need to reform the distribution companies. A highly skilled workforce will be required to run the infrastructure. This will entail reskilling existing engineers and training new ones. The energy geography of the country will change because of massive investment in renewables. Coal producing States in North India will have to get into the transition mode and create new employment opportunities for those who are currently employed in coal mines because most of the renewable energy will be generated in the western and southern states of the country. Therefore, the main challenge will be to plan for an equitable energy transition in the next 20 years.

H. P. Ranina is a practicing lawyer, specializing in tax and exchange management laws of India.