1) Special investment channel for the UAE
After `Japan Plus` and `Korea Plus`, the government is mulling another separate investment desk exclusively for funds flowing in from the Arab Sheikhdom, to tap the latter’s $800-billion sovereign wealth fund. This is in addition to the UAE-India Infrastructure Investment Fund which Prime Minister Narendra Modi said would be set up with a corpus of $75 billion.
- The government has not made the time-period explicit over which this $75 billion will be spread. The amount is meant to be utilised in developing railways, ports, roads, airports and industrial corridors and parks across India. Over the past 15 years, the UAE has invested only $3 billion, accounting for a paltry 1.2 per cent of the country’s total foreign direct investment inflows of $249 billion.
- Indian companies have turned out to be major investors in UAE with investments outflows from India to that country reaching $55 billion last fiscal.
- According to the Confederation of Indian Industry (CII), in order to correct this imbalance, investments from United Arab Emirates (UAE) can be facilitated by setting up special purpose vehicles in sectors such as semiconductors and renewable energy, apart from infrastructure development.
- According to the India-UAE joint statement, both sides will seek to increase their bilateral trade by 60 per cent by 2020. The UAE is India’s third largest trade partner accounting for eight per cent of the country’s total trade volume. Two-way merchandise trade rose to $60 billion in 2014-15 from $43 billion in 2009-2010.
- During his visit, PM Modi offered investment opportunities of $1 trillion into India by UAE. CII believes this can be tapped by setting up a petrochemical-refinery complex exclusively using Emirati crude. Both countries can explore a joint space exploration programme by way of partnership between India`s successful mission to Mars and UAE`s Al Amal project.
2) Cabinet nod for information sharing pact with Seychelles
In a move to check generation of black money and to curb tax evasion, the Union Cabinet has approved the signing and ratification of an agreement between India and Seychelles for exchange of information with respect to taxes.
- The Cabinet also approved the signing of the revised Air Services Agreement (ASA) between the two countries that would increase the number of flights between the two nations from three to seven a week. The revised pact will update and modernise the existing agreement signed in 1978.
- The agreement on information sharing on taxes will enable the two countries to help curb tax evasion through exchange of information on administration and enforcement of domestic laws related to taxes covered by the pact
- The government has taken various initiatives, including signing of FATCA (Foreign Account Tax Compliance Act) with the US and enactment of black money law. While the agreement does not have any financial implications, only in the event of extraordinary costs exceeding $500, the Government of India will bear the same
- The Air Services Agreement with Seychelles signifies an important landmark in the civil aviation relations between the two countries and has the potential to spur greater trade, investment, tourism and cultural exchanges between the two countries
3) Iran removed from restricted visa list countries
The Union government has removed Iran from the list of countries put under the restricted visa category, indicating that it wants to reach out to the Persian Gulf nation. India sees Iran as a key supporter in the wake of the growing threats and influence of Islamist terror groups such as the Islamic State in Central Asia. India has liberalised its visa policy for Iran and struck it off the prior referral category (PRC) of countries. Three categories of visas — employment, conference, students and research visa — were on the restricted list till now.
- On 19th August, the Union Home Ministry issued an order which said Iran was no longer on the PRC list, which has countries such as Pakistan, Bangladesh and China.
- The decision comes after National Security Adviser Ajit Doval convened a high-level meeting in July to explore the possibilities of lifting restrictions on visas for Iran nationals. Mr. Doval visited Iran in February and underlined the need for widening cooperation between the two countries in fighting terrorism.
4) PM Modi appeals Pacific island nations to support India for permanent UNSC seat
Prime Minister Narendra Modi has appealed the Pacific island nations to extend support to India for a permanent membership of the UN Security Council. In his opening remarks in the 2nd India -Pacific Islands Cooperation, FIPIC Summit in Jaipur on 21st August, the Prime Minister said that the member countries must together press for reform in the UN Security Council to ensure its relevance and effectiveness in the 21st century.
Terming climate change as an existential threat to the Pacific islands, Narendra Modi sought a concrete and effective outcome on climate change at COP 21 in Paris later this year. He stressed that we should work together for a separate goal on climate change in the Sustainable Development Goals, and in a manner that addresses the interests of developing countries.
Other important points:
- Modi said that India’s grant-in-aid to these countries has been enhanced from 125,000 to 200,000 US dollars.
- He also announced the establishment of the FIPIC Trade Office in the Federation of Indian Chambers of Commerce and Industry in New Delhi.
- The PM exhorted these island nations to become partners of India in various fields beyond fisheries, and to work together for a separate goal on climate change.
- All the above-mentioned dignitaries expressed strong support for UN reforms and India`s candidature for the permanent membership of a reformed UN Security Council.
5) Pakistan calls off NSA-level talks with India
Pakistan is not ready to focus fully on terrorism and calls off NSA-level talks with India. Talks between National Security Advisors of two countries were to begin on 23rd August. India has termed Pakistan`s decision to call off talks as `unfortunate.`
- External Affairs Ministry further said India never put any preconditions for the NSA Level talks. What India had insisted upon was commitment to the spirit of Shimla Agreement and the Ufa Declaration.
- In some tough talking that has put the ball back in Pakistan`s court, India has made it clear that while it is committed to peaceful and bilateral talks, it will not be held hostage by any pre- conditions set at the last minute and that talks with separatists is unacceptable. Pointing to increased ceasefire violations and cross border terrorism, India questioned commitment to the Ufa agreement.
- Last year India had cancelled talks with Pakistan after its High Commissioner held talks with separatist leaders just before the NSA level talks. Terrorism and other contentious issues, which are in the domain of the NSAs, will be taken up at the talks.
- This includes destabilisation in FATA, Balochistan, and Karachi. Sources say India will not only handover evidence of Udhampur attack perpetrator Naved belonging to Pakistan but also evidence of Pak involvement in the Gurdaspur attack and a dossier with evidence on Pak sponsored terrorist attacks on Indian soil. India will also hand over a list of absconding terrorists and criminals who have sought refuge in Pakistan.
6) Cabinet approves MoU between India, Nepal for construction of petroleum pipeline
Current Affirs Union Cabinet on 12th August approved the Memorandum of Understanding between India and Nepal for construction of petroleum products pipeline from Raxaul in India to Amlekhgunj in Nepal. The MoU will promote bilateral cooperation in the oil and gas sector and secure long term supply of petroleum products to Nepal. It will also help to preserve the environment along the route and decongest the international border at Raxaul.
- On behalf of Indian Government, the Indian Oil Corporation (IOC) has been entrusted with the job of construction of the pipeline and re-engineering of the Amlekhgunj Depot and allied facilities. In the first phase, a petroleum products pipeline from Raxaul to Amlekhgunj will be constructed by IOC at a cost of 200 crore rupees.
- The Cabinet also gave ex-post-facto approval to an MoU between India and Mongolia to establish basis for cooperative institutional relationship to encourage and promote technical bilateral cooperation on new and renewable energy.
- This MoU was signed at Ulaanbaatar during the visit of the Prime Minister to Mongolia on 17th May this year. The Cabinet also gave ex-post-facto approval to a MoU between India and France to establish basis for cooperative institutional relationship to encourage and promote technical bilateral cooperation on new and renewable energy issues. The MoU was signed in Paris, during the visit of the Prime Minister to France on 10th April this year.
7) India to set up skill development centre for Agriculture in Sri Lanka
India will establish a Centre for Skill Development for the Faculty of Agriculture at the Kilinochchi Campus of Jaffna University in Northern Province of Sri Lanka. Following competitive bidding, the contract to construct the building complex was awarded to a private company in the presence of Indian High Commissioner Mr. Y.K. Sinha, Sri Lanka’s Secretary of Higher Education Mr. P. Ranepura and Vice Chancellor of Jaffna University Prof. Vasanthy Arasaratnam in Colombo.
- The project, that is a part of India’s development partnership with Sri Lanka, will cost 15 crore rupees. It includes construction of building, supply of equipment and furniture, training and curriculum development.
- The project is a result of India’s commitment towards capacity building in the Tamil majority Northern Province that was devastated by a 30 year long war between LTTE militants and the Sri Lankan security forces.