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INDIA OFFERS NEW EXPORT TAX CONCESSIONS

NEW DELHI, India - The Indian government will now offer tax concessions to exporters and has proposed the creation of free trade zones in a new plan aimed at doubling the country's share of global trade within five years.

The new policy is also expected to create jobs and stimulate the economy, according to a government spokesman, who said that trade "is not an end in itself, but a means to economic growth and national development."

To double India's 0.7% share of world trade by 2009, its exports must grow more than 20% annually, he said.

The new policy aims to simplify procedures, remove tax anomalies and create "an atmosphere of trust and transparency," the spokesman said.
 
The proposed plan calls for the creation of new Free Trade and Warehousing Zones, where foreign companies will be able to build their own warehouses and store and sell their products tax-free.
 
Certain goods exported from outside the free trade zones will also be exempt from service tax under the plan, while some goods will no longer be subject to import duty.

Those exporters who exceed a 20% growth target will be rewarded with more duty concessions under the plan.
 
Critics of the proposed plan have said that that past efforts by exporters to increase market share have failed because of bureaucratic hurdles and poor trade infrastructure.
 
PHILIPPINES IN FISCAL CRISIS, PRESIDENT SAYS

MANILA, The Philippines - Philippine President Gloria Arroyo has acknowledged for the first time that the Philippines are now in a "fiscal crisis", as economists recently warned of an "Argentinian-type" debt default within the next three years.

"We are already in the midst of a fiscal crisis and we have to face it squarely," Arroyo said.

Budget Secretary Emilia Boncodin said Arroyo had ordered aides to "evaluate the proposal to declare a state of fiscal crisis."

Such a declaration would allow the president to withhold, for a limited period, the release to local government units of a portion of the 30% of taxes collected by the government that is alloted to them by law.

Aides earlier rejected Philippine comparisons with Argentina's debt woes, saying Manila was still paying down its obligations.

A group of University of the Philippines economists warned a likely uptick in global interest rates will make it much costlier to repay the government's overseas debt raising the risk of default within the next two or three years.

"This would result in a sharp cutback in subsequent credit, particularly from foreign lenders, and precipitate a crisis such as that Argentina or Turkey experienced," said the group, who include ex-cabinet members Benjamin Diokno, Felipe Medalla, Solita Monsod and Gerardo Sicat.

Manila last fell into a debt hole in 1983-1984, when it defaulted on sovereign obligations and was cast off from the international financial markets.
 
JAPAN'S TRADE SURPLUS SOARS

TOKYO, Japan - Japan's trade surplus rose in July from the same period last year for the 13th straight month and, even though exports were down slightly from June, economists said demand in the main markets of China and the US was holding up "for now."

The country's Customs-cleared trade surplus rose 44.2% in July from a year earlier to $10.3 billion, according to recent figures released by the Finance Ministry in Tokyo.
 
Exports rose 14.3% from a year earlier, helped by sales of cars, steel, digital cameras, and flat panel TVs.

But compared with a month earlier, exports were down 0.3%, marking the second consecutive month of decline.

Imports rose 8.2% year-on-year as crude oil imports rose 22.5%, but were down 1.2% from June.

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