11/07/2014 Asia Business Report


11/07/2014

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Cable said the price was the best that could be achieved. Now on BBC

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News, all the latest business news live from Singapore.

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India's new government delivers its first Budget, reaction from the

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financial capital is next. Japan looks to a Pacific nation to secure

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important energy supplies. Thank you for joining us on Asia Business

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Report. I'm Rico Hizon. India's new government delivers its first

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Budget, reaction from the financial capital is next. India's new

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government is promising to bring back higher economic growth with its

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first Budget, but the reaction has been mixed. Some were disappointed

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that a number of key issues were ignored, and others thought it was a

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pragmatic Budget. The new administration had indicated that

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tough measures had to be in place to help the Indian economy gets back on

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track. We're now joined by our correspondent. Shilpa, is the Budget

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the bitter medicine that the Finance Minister and Narendra Modi had said

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it would be? This morning's newspapers have been kind. The

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verdict is that it was a cautious start. Industrial leaders we spoke

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to yesterday were disappointed. They said it was a missed opportunity,

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because the electoral mandate was so strong, they had the leeway to do a

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good job here. They haven't done a bad job, it is not strong enough.

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Nothing was a big bang, there were no fireworks or subsidy cuts. What

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about foreign investors, what is in it for them? One was a policy

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introduced by the previous government, which has hit local

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taxpayers, including Vodafone, which was hit by a tax bill

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retrospectively, which made many foreign investors cautious about

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putting money here. This controversial law has been blamed

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for choking investment pipelines into India, and so he made a strong

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statement saying that they would not support any retrospective amendment,

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but did not repeal the law. Many analysts are saying that this is

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good enough to get started with, and that the Foreign Minister will look

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at the market again. What are experts saying in India? The economy

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has been expanding below 5% over the past several quarters, could it at

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least improve the economic fundamentals going forward?

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Absolutely. It was meant to be a Budget to revive growth, and

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kickstart the recovery, while the country is in the worst economic

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state in a decade. While there were many good intentions, much debated

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goods and services taxes will be discussed, they will iron out the

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differences, introduce it next year. Bringing down the fiscal deficit,

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building more manufacturing zones, creating more jobs. We didn't see it

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any actual roadmap. We didn't see a plan in place. So a lot of people

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are talking about, yes, it is all good intentions, but how will he

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achieve this? How will he bring down the fiscal deficit? India has a huge

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subsidy burden for things like food, fuel, and fertiliser. It is about

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$40 billion, and another that has been cut. He said there has be more

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effective, but there are no actual cuts. Thank you for joining us.

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Meanwhile, for the first time in nearly three decades, Papua New

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Guinea is playing host to a Prime Minister from Japan. He is looking

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to shore up Japan's future energy supplies, and Papua New Guinea is

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becoming a big provider of natural gas. And while the future of

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Japan's 50 nuclear facilities remained undecided, finding

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alternative sources is a priority. They rely on the south`east Asian

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nation for their energy needs. I spoke to a correspondent from

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Sydney, and asked him what makes Papua New Guinea an attractive

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provider. They have extensive resources, and they have proved they

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might just take the first step in tapping them. It is quite clear that

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popular New Guinea will be an important player in the region for

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many years to come. A key player in deed, but should foreign investors

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be concerned about the security situation in the nation, and the

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corruption case involving the Prime Minister of the country? There are

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certainly risks involved in being in Papua New Guinea, and investing in

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large infrastructure projects there, but a lot has been learned in recent

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years, where environmental concerns and failure to include landowners in

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the benefits have meant that projects have been shut down. These

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lessons are fresh in the minds of investors, and in the minds of the

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government, and while there is turmoil at the moment, the value

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that could be released through these projects is so large that many are

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willing to take the risk. Michael McCarthy. When it comes to doing

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business and forcing changes, it can be quite difficult. Even harder when

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the people you work with are your relatives. In this latest part of

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our family business series, we take you to Taiwan, and a firm which is

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reinventing itself. For more than a century, this woman's family has

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been making calligraphy brushes. Their skills and knowledge are the

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best types of family business branding. This man is the fourth

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generation in the business, and he was not going to do things the way

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his parents, grandparents and great grandparents did. Take a closer

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look. Some of the shelves display not calligraphy but cosmetic

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brushes. Using their expertise in hair, they now sell more than a 100

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types of brushes for cosmetics as well. We have just written the

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Chinese characters for BBC. Yes. Why did you decide to transform the

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business from strictly calligraphy into one that makes cosmetic

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brushes? TRANSLATION: It was in 2008, I was working in sales in the

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family business, and I noticed that deliveries had declined, and passed

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by a nail salon and noticed how fine the nail brushes were. I thought

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that we could make brushes as fine as that. I didn't tell my elders, I

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secretly asked my brush making Master to make one. When my

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grandfather found out, he thought it was good quality, and that it was a

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good idea. Despite getting tacet approval from his elders, he faced

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other challenges. He had to convince customers that his company could

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make great brushes, not just for calligraphy, but for makeup. He also

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had to source new materials, and market his product in a different

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way, including online. Taiwan's's economy is made up of many

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family`run companies. This store is an example of how, in recent years,

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many of these businesses had transformed in order to keep running

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for generations to come. Their hard work has paid off. Revenue has

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increased, and the company is increasingly known for the makeup

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side of the business, which now makes up 70% of all revenue. But he

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has no plans to abandon the roots of the family business. He wants people

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to continue to appreciate calligraphy, but if they come to him

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first for makeup brushes, that is just good business. Coming up, don't

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miss Talking Business. Our host will be talking about the music industry.

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It has come a long way since the money was made from selling records.

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It is all about downloading, live performances, and music streaming.

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So what is the new business model for those working in industry? Here

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is the founder of the Black Eyed Peas. It has been a big change. Back

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in the day, we had to prove ourselves to the record companies,

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that our music was tangible, because in LA, it was predominantly gangster

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music, and we were not tangible enough. We would shop our demos to

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Interscope, Sony, we had to prove ourselves. Back then, I don't want

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to reveal my age, but there was no e`mail or Facebook, no Twitter, and

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so we had to create a mailing list. But nowadays, artists have more

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avenues to present their music, through YouTube and Instagram and

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other social media sites, and so there has been a big difference.

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More of that interview on the programme.

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Before we go, a quick look at the markets. Asian stocks are mostly in

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negative territory, in mid morning trade, after concerns about the

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financial health of Portugal's top listed rank. Investors are also

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anxious about the US earnings season and a spate of disappointing

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economic data globally. Have a great World Cup weekend, everyone.

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Argentina versus Germany on Sunday. Goodbye for now.

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The top stories sour: as the conflict between Israel and the

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Palestinians escalates, a ceasefire is being discussed. Germany will

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expel a top CIA official from the country in a row over

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