New global manufacturing hub

India will be a new global manufacturing hub as Lockdown ends

India will be a new global manufacturing hub as Lockdown ends: -The coronavirus pandemic has shaken up the whole world and India also hasn’t been spared by its consequences. But amid this tough scenario, India is emerging as a new international production hub as firms find ways to market their supply chains and discover new markets.

Many reports reveal India becoming a destination of choice for international manufacturing giants now producing in China. Many nations like South Korea, America, and Japan, which have been previously determined by China, are currently excited about altering some or all their production to India. These firms belong to various sectors such as pharmaceuticals, cars, electronic equipment, fabrics, and computer hardware.

In any case, Facebook has spent USD 5.7 billion in Reliance Jio throughout the coronavirus pandemic. Additionally a renowned German footwear manufacturer, Von Wellx will shift its production out of China to Agra. All headlines show that overseas businesses see a significant economic and growth potential in India.

Advantages of having a Production Setup in India

India has lots of benefits as a production hub for businesses globally. The nation includes low-costs in fabricating, relatively inexpensive land and labor, ever-improving infrastructure, positive business coverages, decreased corporate tax rates, and government assistance New global manufacturing hub.

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Anyway, India is vigorously working to improve its supply chain capabilities to appeal to overseas firms seeking to change from China into India.  New global manufacturing hub 1 case of that is the powerful running of this very first double-stack container train from the Railways. It reveals India is capable of supplying a world-class center for the movement of products by any transport network.

Government Efforts to Boost India as the best Manufacturing Destination

The Indian Government is actively bringing reforms to improve the Indian market and encourage FDI. Few of the Actions taken by the Government include:

  • The company rate tax has decreased from 30 percent to approximately 25%. India’s corporate tax rate is currently the lowest in Southeast Asia.
  • Initiatives like Earn India’ and Skill in India’ were introduced to concentrate on creating job opportunities in the manufacturing industry and improving skill development to make a huge pool of skilled human resources New global manufacturing hub.
  • Property acquisition principles have relaxed.
  • Companies and Limited Liability Partnerships Gain from many relaxations from the Businesses Act 2013 and also LLP Act 2008.
  • Income taxation, GST, and habits reliefs came in as Lockdown was raised.
how do we run business in Covid-19

How Do We Run Our Business During COVID-19

The COVID-19 pandemic is spreading quickly, with new updates flying inconsistently. In this scenario, businesses are thinking about how do we run our business during COVID-19. As the circumstance develops, numerous entrepreneurs are uncertain of what steps to take to relieve risk, secure workers, and support a customer.  

How Do We Run Our Business During COVID-19

The AKSSAI offers a coronavirus toolbox with an aggregation of the CDC’s suggestions for business and across the nation. Here are the keys and immediate steps the CDC prescribes. 

Build up a remote work choice 

With a lot of individuals previously working remotely, there are many free instruments entrepreneurs can use so groups can keep in contact and continue working regardless of whether they aren’t in the same place. 

Execute a remote work arrangement that covers when you anticipate that your group to be online or accessible, how to communicate (by means of email, Slack, or video call, for instance), and what expectations each team member is answerable for finishing. 

Lesser gatherings and travel 

Attempt to keep chances for exposure to the infection to a minimum. Postpone any team meetings or hold them virtually. Skip any conferences or other planned business travel. If your workers get sick due to travel or meetings, you’ll have a liability issue on your hands, otherwise, you will need to manage low morale and leave requests.

Give workers flexibility 

Schools across the nation are shutting, as are workplaces, stores, organizations, and commercial centers. With the nation gradually advancing toward an all-out lockdown, you should be adaptable with your workers’ time.

Read More:- International tax updates due to COVID-19

Some team members may need to leave out of the blue if their kid’s childcare closes. Others may have students who get back home from school for spring break and can’t return. How do we run our business during COVID-19.? Attempt to be as understanding as possible when something comes up and have a contingency plan in case that you out of nowhere become short-staffed. 

Discuss transparently with your customers 

Everybody is confronting this emergency together, so be straightforward about what your business is experiencing. Customers can empathize with brands facing an emergency, as long as you communicate with them appropriately.

impact of covid-19 on tax treaties

Impact of covid-19 on tax treaties in India

Impact of COVID-19 on Tax Treaties-The Organisation For Economic Co-operation and Development (‘OECD‘) has issued rules and regulations on the considerations or issues arising out of the application of tax treaties because of the impact of the COVID-19 disaster.

Many firms discover themselves confronted with unexpected and compelled adjustments within the working methods of their workers who’re unable to carry out the duties in their nation of employment. The primary challenges are like the creation of everlasting institutions, residential status provisions, and many others.

Impact Analysis of COVID-19 Disaster on Tax Treaties

A. Creation of Everlasting Institutions Issues – Service PE/ Company PE

– As a result of COVID-19 Outbreak, workers/ administrators/ CEO/ CFO/ MD are working from dwelling. They may not have been traveled to their host nation as a result of locked down situations and transportations disruptions

– OECD treating this as distinctive circumstances and stating that it mustn’t affect Service PE/ Company for international firms since it’s taking place as a result of Force Majeure/ upon authorities directives

– Employees are usually not doing all this underneath routine mode. They’re working from house as a result of force majeure and not an enterprise’s requirement

B. Creation of Everlasting Institutions Issues – Construction PE

– Due to COVID-19 Outbreak, many sites or actions are being stopped. Nevertheless, such interrupted interval shall form a part of triggering standards for figuring out Construction PE

C. Creation of Residency of Firm

– OECD has acknowledged short-term change wouldn’t affect the residential status of the corporate. All of it depends upon Place of Effective Management (‘POEM’)

– COVID-19 mustn’t affect the residential status of the businesses since it’s a distinctive one

D. Creation of Residency of People

– The salary and related advantages typically taxed on the place where employment is exercised

– Many nations have issued clarifications stating the time spent in the home country as a result of COVID-19 wouldn’t be counted/ considered while figuring out residential provisions since it is because of extraordinary conditions

– Tie-breaker guidelines will assist to People in figuring out residency

E. Cross Border Employees

– The OECD is working with nations to mitigate the unplanned tax implications and potential new burdens arising due to the results of the COVID-19 disaster.

Along with the above, the OECD has beneficial to all of the nations to implement the above-mentioned measures in domestic rules in an effort to keep away from undue hardships to the taxpayers as a result of COVID-19. By that taxpayers shall be saved from pointless necessities, filing or submitting of returns and compliances, and so on.