New Delhi: India’s move to block a China-led investment facilitation pact in the recently concluded WTO ministerial meeting in Abu Dhabi will help promote multilateral agreements in the 166-member global trade watchdog, according to experts.
The ministerial conference (MC), the highest decision-making body of the World Trade Organisation (WTO), concluded late night on March 1. The talks, which were to end on February 29, got extended by almost two days due to a logjam among members on key issues like agri, fisheries subsidies and the e-commerce moratorium.
International trade experts stated that India’s principled stand in opposing the addition of the IFDA (Investment Facilitation for Development Agreement) into the WTO is based on its longstanding support for multilateralism.
A group of over 120 nations, led by China, tried to push the IFDA to integrate into the WTO as a plurilateral agreement at the 13th MC meet in Abu Dhabi, UAE.
India, South Africa and others opposed it because it was a joint statement initiative and did not have a ministerial mandate.
“India, along with other developing countries, was also cautious about the push for a multilateral framework on investment facilitation, arguing that it could impose binding commitments that limit policy space for development and industrialisation strategies,” Global Trade Research Initiative (GTRI) founder Ajay Srivastava said.
Sharing similar views, former head of the Centre for WTO Studies Abhijeet Das said that India’s stand would help preserve the WTO as an institution for multilateral agreements, and not plurilateral agreements.
In a multilateral pact, all the 166 members have to reach a consensus for that, as it is the basic foundation of the WTO. On the other hand, when a group of nations signs a pact is called a plurilateral agreement.
Ashwani Mahajan of the Swadeshi Jagran Manch also said that by blocking the agreement, India has safeguarded sovereignty and global peace.
IFDA aimed to create legally binding provisions for facilitating investment flows, and it requires states to augment regulatory transparency and predictability of investment measures.
“It must be noted that though every international agreement limits scope for domestic regulations, in the case of IFA this is more the case and sovereign rights of the member countries compromised in the name of investment facilitation,” Mahajan said.
Further, Srivastava said that the new issues are quietly sneaking into the WTO agenda.
“Most new issues start as the Joint Statement Initiatives (JSIs) by some WTO members to promote discussions on specific trade-related issues and without agreement from all WTO members,” he said, adding that the EU-led initiative on domestic regulation on services supported by 72 nations was accepted with consensus by WTO members for inclusion into the WTO rule book.
India is not part of any JSI so far. Its primary opposition stems from the fact that discussion on any subject must be initiated with the consensus of all WTO members. India feels that this weakens the core agenda of the WTO at the cost of pursuing issues of certain members.
Ranja Sengupta, Senior Researcher and Coordinator of the Trade Programme of Third World Network (TWN) said in spite of 80 countries having submitted a proposal on finding a permanent solution to the public stockholding for food security purposes in 2022, it was never even discussed.
“And in spite of the mandate, the permanent solution was not again agreed in MC13. The US and Cairns Group countries refused to even update the External Reference Price, which is fixed at an ancient 1986-88 level and artificially overestimates the subsidy given through price support. How long will developing countries keep getting denied their rights?” she said.
The talks at the WTO’s ministerial conference ended on March 2 with no decision on key issues such as finding a permanent solution to public food stockpile and curbing fisheries subsidies but the members agreed to further extend the moratorium on imposing import duties on e-commerce trade for two more years.
(Published 03 March 2024, 14:47 IST)
As per the new rules, the ministry will cap the maximum score that bidders would get even if they quote abnormally low prices and there will be a limit on how many contracts any consultancy firm, based on assessment of its capacity, can take at one point of time.
Recently, two probe reports on Silkyara tunnel collapse in Uttarkashi by the central and Uttarakhand govt pointed to preparation of “deficient” detailed project report (DPR), a trend that has become a cause of concern for govt as well.
TOI has learnt that road transport ministry has circulated the amended norms to all highway owning agencies.
Preparation of poor DPRs results in deficient project planning, delays implementation and leads to frequent change of scope, which ends up adding to costs for govt.
As per the new norms, the revised weightage will be 80% for technical and 20% for financials, which is known as quality-cum-cost based selection (QCBS). The agencies will open financial bids only when a company gets an 80% score on technical parameters. Then the average bid prices quoted by all the bidders will be worked out and any bidder quoting 25% less than the average price will get the maximum score. This will bring bidders to a level playing field.
Sources said these provisions have been incorporated considering that finance ministry guidelines specify that no bidder can be eliminated. “Till now companies that score less in technical qualification, which takes into account the qualified manpower on their roll and their past records, end up bagging projects after quoting very low prices. This resulted in less capable players getting more projects. Now it will change,” said an official.
Similarly, there will be a cap on the number of projects a private player can get based on its capacity, including turnover and permanent key personnel. Companies will be barred from bidding for future projects, if they give wrong information. In certain cases, the companies would have to pay back the salaries or fees they get for their key expert professionals, if the details are found to be wrong.
According to the new norms, there will be ratings of consultants as well.
Indian investors have put in around $1.6 billion in Dubai’s real estate market between 2020 and the first half of 2023.
Indian investors emerged as the top buyers in Dubai’s thriving real estate market for consecutive two quarters last year. Indians, Britons, and Russian investors have been major buyers of commercial and residential properties in Dubai. The property market in Dubai has seen post-pandemic recovery due to pent-up demand from travellers and higher spending by residents.
According to the Better homes Residential Market Report 2023, Indians were the largest investors in the Dubai market in June and September quarters of 2023, beating the UK investors.
The Dubai real estate market saw 28,249 deals in the September quarter, which was 4% higher than in the previous June quarter and 23% more than that in the September quarter of 2022, the recently released report said. Villa and townhouse deals saw a sharp 34% expansion in the September quarter while apartment sales declined 4%.
Realtors say Indians have been a major driving force in Dubai’s realty market as they figure among top three nationalities to buy properties in the Emirate since 2002.
What makes Dubai’s property market attractive for Indian investors?
According to international property consultant Vestian, Indian investors invested $335 million in the first half of 2023, which was higher than $221 million in the same period of 2022.
Citing data from Dubai Land Department, Vestian stated that as many as 123 projects saw Indian investments. The major factors attracting Indian investors are Dubai’s tax-friendly policies and strategic location of the emirate. In recent years, Indian investors have put in around $1.6 billion in Dubai’s real estate market between 2020 and the first half of 2023, according to a report by real estate consultant Vestian.
According to Richard Waind, the CEO of Dubai-based Betterhomes, Golden Visa programme is also one of the factors behind realty investment in the Dubai market. The Golden Visa programme allows foreign nationals to live, work or study in the United Arab Emirates, and enjoy several other benefits.
The Golden Visa programme offers several incentives such as non-requirement of a sponsor, an entry visa for six months with multiple entries and renewable residence visa for 5 years or 10 years.
Dubai remains a key destination for expats across the globe as their population rose by more than 1,00,000 in 12 months until July 2023, says Waind.
In a recent interview, Sobha Limited Chairman Ravi Menon said that Dubai is well positioned for taking on future challenges and maintaining its growth. A number of ambitious projects and government initiatives are driving the growth of the realty sector making it a hub for property investments, according to Menon. The developer is known for large ventures in Dubai and Middle East markets, with an estimated business of $4.5 billion in the emirate alone.
Ravi Menon attributes the realty growth to a strong emphasis on infrastructure development. According to Menon, infrastructure projects such as Dubai Metro and airport expansion would enhance the connectivity and increase the appeal of the emirate for further realty investment.
The thriving tourism and hospitality sectors and business friendly environment of the emirate are key levers of growth. Dubai is known for the luxury and world-class hospitality, which attracts both business and leisure travellers.
Dušan Piksiades, a Sales Manager at proptech Housearch, also believes that Dubai will be one of the most attractive and desired cities when it comes to investment in real estate.
With a stable economy and a projected growth of 4.5%, the UAE has one of the highest predicted economic growths in the next year. This is the main factor which will still keep Dubai “at the top” of the “investment chain”, and bring in more investors, says Dušan Piksiades.
The growing luxury market is also propelling the realty growth in the emirate.
According to Betterhomes Residential Market Report, deals worth $4.83 million were reported in the luxury property in the September quarter, around 44% growth over the second quarter. The launch of high-end off-plan projects like Palm Jebel Ali is set to boost the luxury market.
High rental yields are also one of the main factors for attracting Indian investments in Dubai, as per property consultants. The returns have beaten those in key Indian cities of Mumbai and Chennai.
Munawar Abadullah, the founder and CEO of PropTech and FinTech, PHOREE, says that property prices rose by 18% in 2023 on the heels of a substantial increase in the previous year. Total realty sales hit AED 322 billion ($87 billion) in 2023, which was a 52% increase from the previous year.
The key drivers of growth included a 3.3% economic expansion propelled by the accommodation, transportation, and IT sectors, coupled with an influx of millionaires. Abdullah highlights that Dubai welcomed about 4,500 millionaires in 2023, crediting this phenomenon to progressive reforms that have transformed Dubai into a more cosmopolitan hub