Tuesday, November 26, 2024

India-Singapore economic corridor is on the upswing

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India is poised to play a pivotal role in the post-pandemic world order. India, the world’s fastest growing large economy, is on track to rise from the fifth to third largest economy by 2030, driven by strong fundamentals. Hence, India’s strong commercial ties with countries around the world and the attraction of attracting inbound investments. Although the United States and Europe have historically been India’s largest investors and this trend is likely to continue unabated, the past decade has seen a notable eastward shift. As domestic companies expand, they are increasingly looking for ways to tap Asian markets and build connections with Asian supply chains. Singapore, the gateway to Asia, is a global trading hub with a business-friendly environment and competitive tax system. India has thousands of years of historic commercial, cultural and people-to-people ties with Singapore. Both countries have continued to build on this foundation, as evidenced by the Comprehensive Economic Cooperation Agreement (CECA) signed in 2005. After the agreement, bilateral trade more than quadrupled, reaching $35.6 billion in 2022-23, underscoring the effectiveness of the corridor.

India is poised to play a pivotal role in the post-pandemic world order. India, the world’s fastest growing large economy, is on track to rise from the fifth to third largest economy by 2030, driven by strong fundamentals. Hence, India’s strong commercial ties with countries around the world and the attraction of attracting inbound investments. Although the United States and Europe have historically been India’s largest investors and this trend is likely to continue unabated, the past decade has seen a notable eastward shift. As domestic companies expand, they are increasingly looking for ways to tap Asian markets and build connections with Asian supply chains. Singapore, the gateway to Asia, is a global trading hub with a business-friendly environment and competitive tax system. India has thousands of years of historic commercial, cultural and people-to-people ties with Singapore. Both countries have continued to build on this foundation, as evidenced by the Comprehensive Economic Cooperation Agreement (CECA) signed in 2005. After the agreement, bilateral trade more than quadrupled, reaching $35.6 billion in 2022-23, underscoring the effectiveness of the corridor.

Since India allowed 100% FDI in most types of manufacturing, several large Singaporean conglomerates and manufacturers, as well as national institutions, have stepped up or are planning to increase their investments in India. is standing. Meanwhile, Indian state governments are collaborating with Singapore on initiatives such as smart cities, urban revitalization, and skills development. Trade is following a similar trajectory, with the Association of Southeast Asian Nations (ASEAN) listed as a central pillar of India’s Act East policy, and trade between ASEAN and India accelerating in recent years to reach $131 billion by 2023. reach. This is a compelling case for India to strengthen its ties with her ASEAN bloc and, within this group, with Singapore.

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Since India allowed 100% FDI in most types of manufacturing, several large Singaporean conglomerates and manufacturers, as well as national institutions, have stepped up or are planning to increase their investments in India. is standing. Meanwhile, Indian state governments are collaborating with Singapore on initiatives such as smart cities, urban revitalization, and skills development. Trade is following a similar trajectory, with the Association of Southeast Asian Nations (ASEAN) listed as a central pillar of India’s Act East policy, and trade between ASEAN and India accelerating in recent years to reach $131 billion by 2023. reach. This is a compelling case for India to strengthen its ties with her ASEAN bloc and, within this group, with Singapore.

The city-state’s strong financial infrastructure, central location and technological capabilities make Singapore an important hub for Indian companies expanding into Asia. In a move to diversify global value chains, Asian banks could use Singapore as a trade and financial nexus to help Indian companies tap commercial opportunities across the continent. Proof of this is that in 2014, around 6,000 Indian companies were registered in Singapore, and that number is expected to increase to more than 9,000 by 2023, including tourism, telecommunications, financial services, e-commerce, etc. covers a wide range of fields.

Increased connectivity is spurring advances in financial technology, with the breakthrough Unified Payments Interface (UPI) and PayNow systems starting to integrate in early 2023. In fact, Singapore was the first country where India announced cross-border person-to-person transactions. Online payment facility for people. This innovation, led by national central banks, is the world’s first real-time payment system integration using cloud-based infrastructure that can scale as remittance volumes increase, and has already reached nearly 3,000 transactions per month. The introduction of the TradeTrust framework this year will enable interoperable electronic bills of lading (eBL) for trade finance transactions between entities in Singapore and India, leveraging blockchain technology to facilitate cross-border commerce through digitization. This marks a new milestone in promoting the Estimates suggest that switching to electronic bills of lading could strengthen supply chain resiliency, save $6.5 billion in direct costs, and drive an additional $30 billion to $40 billion in new global trade value. (McKinsey, 2022).

India is expected to drive one-fifth of global growth by 2031, and this outlook is driven by several evolving trends, including digital adoption, offshoring capabilities, and the ongoing transition to clean energy. It’s backed up.

In line with the country’s sustainability commitment to generate 500 GW of renewable energy capacity by 2030, India’s current renewable energy mix is ​​very encouraging and will increase the country’s power generation capacity by 2022. 92% of the growth is due to solar and wind power. Singapore is willing to take full advantage of India’s renewable energy growth potential, both as a source and as a conduit for much-needed investment.

India has demonstrated economic and political soft power, an advantage that will enable the country to strengthen its role on the world stage, advance issues important to the Global South, and lead the way to net zero. This is your chance to lead. economy. Cooperation between governments, businesses and financial institutions in the India-Singapore Corridor is key to mutually enhancing growth. Underscoring this concept of bilateral relations was India’s rare invitation to join Singapore as a guest country for the G20 meeting to be held as part of its 2023 Presidency.

The India-Singapore Corridor is much more than just economic cooperation. It could herald a paradigm shift in global dynamics. With the rise of the Asia-Pacific region and India now leading global growth, our two countries are not just players, but architects of the future of global trade and investment.



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