Dear Friends,
I have great pleasure inmeeting you once again
through the columns ofGateway. With the festive
season upon us, let me
start by wishing you all thevery best of success andhappiness in the months
ahead.
I am extremely happy that an important economic event
took place in Chennai – the Tamil Nadu Global Investors
Meet on September 9-10, 2015. As many as ninecountries have partnered the event with the Tamil Nadu
Government and the State has received MoUs worth
Rs. 2,42,160 crore in the maiden Global Investors Meet.
My sincere appreciation and congratulations to the
Hon’ble Chief Minister of Tamil Nadu and her
Government for their bold initiative.
It was also special that the Japan-India Business
Cooperation Committee delegation, Tokyo, lead by
Mr. Muneo Kurauchi, Chairman, Standing Committeeof JIBCC, interacted with IJCCI members on September
9, 2015 amidst their tight schedule. I await theculmination of mutually beneficial and fruitful businessre l a t i o n s o f o u r b u s i n e s s m e n w i t h o v e r s e a sbusinessmen.
I am also happy to share with our friends that IJCCI
will soon be inaugurating a Centre for Japanese Studies.
As all of us know that the 21st Century is very importantin the history of Japan-India relations. Our two countries
working together closely on various important matterssuch as economy, safety, security etc. would bring inprosperity and peace to both the countries. IJCCI Centre
for Japanese Studies will be supported by a Brains Trustof academicians, intellectuals, businessmen, senior civil
servants and diplomats, from Japan and India. The
ultimate objective of IJCCI in establishing this Centre is
to explore, educate and exploit the potentials ofJapan-India relations in every sphere of activity. IJCCI
will bring out a quarterly White Paper on Japan-India
relations under the auspices of Centre for JapaneseStudies.
I assure you friends that IJCCI will put its best footforward in building symbiotic relations between our
two countries.
With warm regards,
N KumarMr. R. Ramakrishna Raja & Mr. T.P. Imbichammad,
Directors of IJCCI, with Japanese businessmen at theIJCCI-JIBCC networking meeting on September 9,2015, when the 14-member delegation visited Chennai
for the Tamil Nadu Global Investors Meet.

Tamil Nadu – An Investors’ Paradise

The Government of Tamil Nadu held
the maiden Global Investors Meetin Chennai on Nov. 9-10, 2015, withthe vision of inclusive growththrough investment flows, growth in
employment, regional development
and environmentally sustainablelong-term developments in theState.
The ambition and the meticulous
planning of the Chief Minister Dr. J.
Jayalalithaa and her dynamic teamof Ministers and Officers received
unprecedented results. The maiden
event of the State received support
from 9 partner countries – Australia, Canada, France, Italy, Japan,
Korea, Russia, Singapore and theUnited Kingdom. The event witnessed a galaxy of foreign delegates– diplomats and businessmen,
besides Indians.
On both days there were countryspecific seminars. The dais wasshared by foreign diplomats andheads of successful multinational
companies. At the country-specificseminars the multinational companies with their roots in Tamil Nadu
made presentations about their
growth and forging close economic
relations between Tamil Nadu andthe respective countries.

2

Senior Officials of the Tamil Nadu
Government showcased the business
opportunities available for exploitation in the State. Every seminar
had an Interaction Session and eachof the seminar halls was overflowing

with sector-specific participatingcompanies and interested visitors.
There were Indian and international
exhibitors’ pavilions witnessing a beeof activities.
An exclusive seminar ‘Vision 2023of the Tamil Nadu Government’e n a b l i n g m e g a i n f r a s t r u c t u reprojects addressed the challenges
to be faced by the State, thestrategies to be adopted and thesolutions to be arrived at, and was

ing the cumulative investments
attracted through all MoUs signedby the Government of Tamil Nadu
between 1991 and 2011, said theChief Minister. She said that theinvestments will be operationalised
under a single window schemewithin 30 days of application, with
one high-ranking administrative
officer assigned to each project, andadded that a major part of theinvestment was planned for the

Global Investors Meet 2015 – An abstract
Department

No of
MOUs

Investment

Employment

Industries
EnergyMSME*
IT
TextilesAnimal Husbandry
Agriculture
Total

50
15
—
17
10
4
2
98

1,04,286.00
1,07,136.00
16,532.67
10,950.00
1,954.83
500.00800.00242159.5

11445515850—
205500
65010
500
68750
470065* MSME department has signed 10,073 MoUs in 32 districts of the State during

the Roadshows conducted.
For further details, please visit: http://tamilnadugim.com

Chaired by the State Govt. Senior
Officials, with participation ofleading multi-sector, multinational
companies.
The Chief Minister of Tamil Nadu,
Dr. J. Jayalalithaa, was present on
both the inaugural and the valedictory functions. The total amount ofinvestment finalised during the twodays is Rs. 2,42,160 crore, exceed-

southern districts. The Chief Minister
expressed her wish that the State
would become the most favoured
investment destination in India andamongst the top 3 investment
destinations in Asia. She also
expressed her desire to conduct the
Global Investors Meet every 2 years
in Chennai, with the next meet
being scheduled in 2017.

Japanese cultural legacy. Reflecting
strong early Chinese influences, thetemples, administration andarchitecture in Nara were later on
supplanted by increasing Japaneseoriginality and authenticity.

Nara was the ancient and first capitalof united Japan. She was establishedin 710 and remained as the capital till
784, when it moved to Nagaoka andsubsequently to Kyoto in 794.
Buddhism flourished during the Nara

Shinto is the oldest religion of Japan.
It not only precedes Buddhism, butalso co-exists with Buddhism to thisday. The name Shinto comes fromthe Chinese characters for Shen or
Divine Being and Tao or Way,
meaning ‘Way of the Spirits’. The
essence of Shinto is the Japanesedevotion to invisible spirits that havepowers to intervene to make life
better. Shinto believes in rituals tocommune with the spirits and to that

period and many monasteries werebuilt in Japan. It is said that the capital
moved because the monasteries
gained such political influence, that it
represented a threat to the Emperor
and Central Government of Japan.
Nara today has 8 UNESCO world
heritage sites and is second only to
Kyoto in showcasing the great

extent it bears someresemblancetoHinduism. Shintoism
believes that divine
spirits are everywhere,
but a key aspect of
Shintoism is ancestral
worship. It is believedthat our ancestors areconstantly watchingover us and theirappeasement leads to positiveeffects. The reigning Shinto spirits
are called ‘Kami’. Shintoism does notconsider these divine spirits as gods
and it allows followers to practise
multiple religions.
Japan is littered with beautiful Shinto
shrines and it is common to see

Nara is less commercial than Kyoto asa tourist destination and is home tobeautiful parks and monasteries that
preserve the legacy of Japan in a time
warp. Some Kerala-style temples in
Nara are bigger with more grandeur
and serene landscapes.
Nara’s star attraction is the Todaiji orGreat Buddha temple where one isgreeted by two fierce guardians,
splendidly sculpted in wood, as one
enters the gates of the temple. Narais about one hour away by train from
Osaka and Kyoto.

many Japanese and foreign visitors
at the shrines. Shinto does not
strive to explain the world, yet it
serves as a great spiritual practiceand a way of life for the Japanesepeople.
Source: Adapted from BBC religion.

Japanese Delegation V
isit
Visit
IJCCI is receiving a 14-member
Japanese Business Delegation fromUNIDO, Japan, and is organisinginteraction programmes/B2B meetings/
seminar in Chennai on 7th December,
2015.

factories,
industrial
parks,
infrastructural facilities, etc).

Sector: Water Supply and Water
M a n a g e m e n t Te c h n o l o g i e s a n d
Facilities (including wastewater
treatment facilities for housing blocks,

Procedure for participation: Senda detailed write-up of the activity ofthe participating organisation, withname of participant, address, e-mail id

Who can participate: Interested
Indian organisations – private sector/
public sector companies involved in thesaid line of activity.

and telephone numbers to:
I N D O - J A PA N
CHAMBEROFCOMMERCE AND INDUSTRY, 21, KB
Dasan Road, Teynampet, Chennai 600
018, Tamil Nadu (please refrain fromsending details thro’ e-mail).
Participation by prior Regn. &Confirmation by IJCCI.
Last date for receiving applications:November 14, 2015.

3

Goods and Services TTax
ax (GST)
In continuation of our previous
article, the Select Committee has
submitted its report to Rajya Sabha
on July 22, 2015. The Committee
endorsed most of the existingclauses in the GST Bill as-is withspecific recommendations onamendments required in few
i n s t a n c e s . T h o u g h t h e re a reroadblocks, the Government is
optimistic that GST will be rolled
out by 2016.
The following demands were put forth
by the major opposition party:
The Standard rate of GST (aggregate
rate of GST – central GST plus stateGST) should be around 18% andnot 24%-25%
The proposed 1% non-creditable
GST on goods in the course of interstate trade should be omitted
completely.
Tobacco, electricity and petroleum
products should be subsumed in
GST.
Constitution Amendment Bill should
provide for mechanism of Dispute
Resolution between States.
G

G

G

G

We have examined below a few ofthese demands:

Revenue Neutral Rate (RNR)
While the States are concerned about
the RNR (Standard rate of GST –aggregate rate of GST – central GST
plus state GST) from revenue
perspective, it is also a matter ofconcern for Trade and Industry.
A high RNR would push up the priceto the consumer and would affectdemand. Besides, high rate would
encourage tax evasion and would be
detrimental to the interests of theorganised compliant entities. RNR
higher than 18-20% would becounterproductive.
However, the Select Committee on
addressing the above issue, has clearlygiven a direction to the GST Council
to opt for a broad base and moderate
tax rate and avoid multiplicity of taxes.

Levy of additional 1% tax onInterstate Supply
The proposal for the levy of 1% noncreditable tax on interstate supply of
goods has been the key point ofcontroversy on the grounds of its
cascading effect. The idea behind this
1% tax is that it would be retained by
the origin State and is ostensibly tocompensate the origin State. While
there may be a case for the origin
State to demand additional
compensation (since under the
proposed GST the tax credit oninterstate supply would accrue to thedestination State), the compensation
should not be by levy of additional
tax. Ideally, the Central Government
should compensate from its share of
the tax pool. In any case, the Central
Government has already agreed tocompensate revenue loss to the States(100% in 1st 3 years, 75% in the 4thyear and 50% in the 5th year) and theorigin States would be compensated.
From a business perspective, the 1%
levy on interstate supply of goods(including interstate stock transfers)
would be an additional cost andcascading, in effect. The 1% levy
would be an additional cost on
procurement and also on distribution
and would have a multiplier effectwhen the goods move throughdifferent States, in the supply chain.
However, the recommendations of theSelect Committee on the above issue
did not suggest a complete omissionof this levy, but has partly addressed itby substituting the term “supply” forpurposes of additional tax levy inclause 18 of the GST Bill with the term“all forms of supply made for aconsideration”, thereby mitigating theadditional levy tax on interstate stocktransfers.

Will GST be rolled out with few
States joining later?
One of the clauses of the Bill (clause
20) not much deliberated in the publicdomain is the Transitory Provision
which provides that the present levies
subsumed in GST would cease to beeffective one year from the date theBill becomes Law.
Implementation of GST without allStates joining on Day 1 is impossible
and not feasible in the GST framework
designed to ensure seamless flow ofcredit to the destination State.
Some of other key issues are
Robust IT infrastructure (GST
Network) should be in place toensure proper recording of interstate
supply of goods and services so as
to ensure seamless flow of credit to
the destination State.
Central and State legislations on
GST and relevant rules andprocedures are to be drafted anddeliberated.
GST administrations in the Centre
and States have to be educated andsensitised on implementation.
Procedural issues in dual
administration by the Central andState administrations are to be
streamlined.
All Stakeholders, down to theconsumer, have to be educated.
Besides, Trade and Industry needtime to understand the law, tweak
IT infrastructure and supply chain,train staff and educate suppliers anddistributors.
While some of the concerns, in theBill, are real and the Parliament should
deliberate and arrive at a practicalconsensus, it is hoped that theGovernment would sagaciously handle
the political issues and go the extra
mile to accommodate the dissidents
to ensure smooth implementation of
the new tax regime in light of creating
a single, cooperative and unified Indian
market and making the economy
stronger and more powerful.
G

G

G

G

G

G

We look forward to implementationof a practical and industry-friendly
GST!
S. Sridharan
Associate Partner,
LeapRidge Advisors LLPEDITORIAL BOARD: N Kumar, President, IJCCI; N Krishnaswami, Chairman, IJCCI; Krishna Prasad, Managing Director, Mot Juste Communication
Services Pvt. Ltd.; P S Suman, Partner, A K Mylsamy & Associates LLP; Hufriz Wadia, Partner, Kochhar & Co.; Arjun Balakrishnan, Founder, Dharmic Solutions;
Suguna Ramamoorthy, Secretary-General, IJCCI. For Private Circulation Only.
Editor: Suguna Ramamoorthy; Publisher: IJCCI; Designing & Printing: Mot Juste Communication Services Private Limited, 98410 15081.

This issue ofis sponsored by Dharmic Solutions Pvt Ltd, Chennai.

Indo-Japan Chamber of Commerce & Industry (IJCCI): No. 21, Kavignar Bharathidasan Road, Teynampet, Chennai 600 018, Tamil Nadu, India.
Phone: 044-24352010 / 044-24354779. Email: indo-japan@ijcci.com. Web: ijcci.com