26/02/2016 Asia Business Report

Now on BBC News, all the latest business news live from Singapore.

The Sharp sale, will it actually happened? Is Foxconn having second

thoughts? -- happen. And a campaign for a national Goods and Services

Tax is proving a hard sell. Hello, and welcome to Asia Business

Report. I am in Singapore. Shares for Sharp have tumbled again,

falling another 15% after opening this Friday. They accepted a

takeover bid from Taiwanese Foxconn. Just hours later it was apparent

that Foxconn may be putting it on hold. They received new information

from Sharp. Investors are concerned. I spoke with a vice president. It is

high drama. They have been in discussions since 2012. They want to

make the deal happen. Suddenly this dramatic moment. No one likes

surprises. What sort of extenuating material information do you think

could possibly put Foxconn off Sharp? We know that Sharp is saddled

with debt. Two things. Though I don't know if I want to gas. Quarter

results. Getting into March and so forth. And then a regulatory

hurdle. The ministry of economics and the trade ministry wanted to put

together a consortium for alternative deals. You mentioned the

Japanese government. How much, if this deal goes through, how much

does it represent a huge mind shift in corporate Japan that they are

finally letting in foreign investors into their technology sector. It is

the sign of the times. Globalisation. Now they are facing

the forces of that process. We have seen Citibank acquire Niko... That

is the financial side, but this is the first real electronics...

Certainly. Telecom is still a key industry for the Japanese. It is up

there. There is probably still some dissatisfaction with this kind of

deal. The prize is Sharp's LCDs. If this deal happened, it almost did,

what would it mean for Sharp's other businesses? Renters, home

appliances... -- priners. Foxconn does a lot of assembly for iPhone.

The LCD screen is a key part of that package and they would have that as

an asset portfolio. The G20 meeting of central bank governors and

finance ministers is under way in Shanghai. At the opening, China's

Finance Minister urged co-operation on economic policy and reducing

trade barriers. It covers about 86% of the world's economies with two

thirds of the world's population and the 5% of global trade. -- 75%. Are

we likely to see co-ordinated action at this meeting? I am joined by

Robert Brant, the Shanghai correspondent. A big story to start

your tour of duty. We have heard from many speakers so far. Yeah. It

was the Finance Minister who opened the first session here in the heart

of Shanghai. The focus for him and the overall focus for the G20 is on

structural reform. The tax frameworks, Social Security,

supply-side reforms and labour markets, here in China and across

the other 19 members. That is of course a huge undertaking and

something that the G20 continues to aid its members to do. The backdrop

to this was Christine Lagarde, the head of the IMF. A Chinese economy

that is growing but with a slowing rate of growth. The IMF has revised

its forecast for the year ahead, cutting off 4.2% of how quickly it

thinks the global economy will grow. These are gloomy times. Not 2008,

the GFC that gripped the world then. But nevertheless, there is the

worry about the fragility of growth, especially in China. There is

concern with what the Chinese government is doing to stop the

slowing rate and to make sure they have a soft landing. It is also the

first big meeting under the presidency of China. How important

is this that it is slowing? China is now the second biggest economy in

the world. Everyone predicts that, given another generation, it will

become the world's biggest and most important economy. But what we are

seeing at the moment is the end of those periods of double-digit growth

for this country, phenomenal over the last 20 years. They are moving

towards what the Chinese government calls "normal times". They want to

see it at 7%. It was at 6.9%. The key thing is how do you move on

those double-digit figures to something more sustainable,

something easier for the politicians and the people of this country to

have. Thank you. In Shanghai, covering the G20 Summit. India is a

country with a seat at the G20 table. But they only have a

representative. The Prime Minister stayed home to prepare a plan. They

want a Goods and Services Tax across the country. But it has proven tough

to get state governments to give up their tax powers. We start our

report in a northern state. Car parts, made in India, destined for

factories in the. It sounds pretty simple. -- United States. We will

find out the journey. They are ready to be driven 2300 kilometres to the

port for shipping. And this is the route across India that the lorries

will take. So far, so good. But here is the problem, the journey goes

across separate states. You can see them on the map.

At each state border you will find checkpoints like this. It is here

that individual states levy taxes on goods moving across the boundaries.

This makes it uncompetitive in the global market. At the moment,

looking at exports, the goods leaving the factory, from here to

Mumbai, it is probably higher from here to Europe or the US. You can

imagine how we are suffering. It is not just about the cost. This is how

to thirds of India's trade travels. By road and on trucks like this. It

is a difficult journey, but only 15% of the time taken is driving, the

rest is spent on border checkpoints, paying levies, and

dealing with paperwork that varies from state to state. Bringing in the

Goods and Services Tax, GST, a unified tax to simple thigh

transactions, should make a difference. Not just getting tracks

across borders quickly, today, firms often have more warehouses in

separate states to minimise the taxes they pay. Clearly, something

like GST is a game-changer for the government. It will help in moving

cargo. It should make India into a free market as what is desired. Four

days after the lorry left the factory the car parts are now

approaching Chennai. The GST hopes to speed things up but it is still

part of the logjam of India's Parliament. They want to get the

country's economy moving a little faster. BBC News, India. That brings

us to the end of this edition of Asia Business Report. I came

Sharanjit