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Now on BBC News, all the latest business news live from Singapore. | :00:00. | :00:15. | |
The Indian economy is growing, but by how much? Recent changes, like a | :00:16. | :00:23. | |
new goods and services tax, have kept people guessing. And Donald | :00:24. | :00:29. | |
Trump snakes a pitch to clean up the tax code in America. -- makes a. It | :00:30. | :00:36. | |
costs Americans millions and millions and millions of jobs and is | :00:37. | :00:38. | |
self-destructive, trillions of dollars. Good morning, Asia. Hello, | :00:39. | :00:45. | |
world. Welcome to another edition of Asia Business Report. I am Sharanjit | :00:46. | :00:49. | |
Leyl. Thank you for joining us. Today, India releases growth figures | :00:50. | :00:55. | |
for the three months until June. They they implemented a new goods | :00:56. | :01:02. | |
and services tax which promises to boost production, but has trouble | :01:03. | :01:05. | |
getting off the ground to be that is after the controversial move last | :01:06. | :01:09. | |
year to remove high-value banknotes from circulation. How was that | :01:10. | :01:13. | |
affecting growth in India? We have this report. After months of almost | :01:14. | :01:20. | |
no work, things are starting to get a little bit busier. This factory | :01:21. | :01:25. | |
makes machines for various industries ranging from hospitals to | :01:26. | :01:31. | |
firms. But the company has been struggling to make profits for the | :01:32. | :01:37. | |
last three years. It became worse when the government banned nearly | :01:38. | :01:41. | |
90% of the cash in circulation last November in an effort to crack down | :01:42. | :01:45. | |
on corruption. TRANSLATION: After the cash ban, most industries cut | :01:46. | :01:52. | |
down production. They were all very worried. We were hardly getting any | :01:53. | :01:58. | |
orders. Sales, which were already low, went down further by 50%. It | :01:59. | :02:04. | |
had a huge impact on India's economy, especially the small to | :02:05. | :02:07. | |
medium-sized businesses like this one. Just when factories started to | :02:08. | :02:14. | |
recover, another setback. In July, a goods and services tax was | :02:15. | :02:18. | |
introduced by the government are completely reformed the way | :02:19. | :02:21. | |
businesses paid tax. The government says the tax overhaul will increase | :02:22. | :02:28. | |
growth. But initial teething problems and the cash ban have | :02:29. | :02:35. | |
stopped consumer demand. In June, production fell to levels not seen | :02:36. | :02:38. | |
in nine years. The World Bank says India's economy will recover and | :02:39. | :02:44. | |
grow by more than 7% in this financial year. But economists say | :02:45. | :02:48. | |
more needs to be done for that to happen. It has the potential to grow | :02:49. | :02:54. | |
at 7.5 - 8%. That that has the potential. However, the real growth | :02:55. | :02:58. | |
engine has to come from private investment, consumption, and | :02:59. | :03:01. | |
exports. We cannot depend on government funded infrastructure to | :03:02. | :03:05. | |
actually be the stimulus for over. The revival of the sector will be | :03:06. | :03:15. | |
important to that engine. It has a big role to play in the third | :03:16. | :03:19. | |
largest economy to fully realise economic potential. BBC News. It is | :03:20. | :03:26. | |
burning season for corporate China and the bank of China is reporting | :03:27. | :03:34. | |
an 11.5% jump to more than $50 billion. -- earning. The fourth | :03:35. | :03:42. | |
biggest lender reported a decline. Overall, the financial sector on the | :03:43. | :03:46. | |
mainland appears to be healthy with lower bad loans. Regulators have | :03:47. | :03:51. | |
been raising efforts to stop the shadow banking system which has over | :03:52. | :03:54. | |
populated nontraditional bank lenders. I spoke to someone to ask | :03:55. | :03:59. | |
if the crackdown is having an impact. Overall profitability for | :04:00. | :04:04. | |
Chinese banks is actually quite healthy. What remains a concern is | :04:05. | :04:09. | |
the net interest income has been deteriorating over the past two | :04:10. | :04:13. | |
years. This is no fault of their own. What is happening is these are | :04:14. | :04:18. | |
macro factors. The property market has been coming off and China is | :04:19. | :04:22. | |
slowing down the pit is not all doom and gloom. The Chinese banks have | :04:23. | :04:27. | |
been wise and are moving away from interest income -based to a | :04:28. | :04:33. | |
fee-based approach. We can see they are currently investing in many new | :04:34. | :04:36. | |
business opportunities like dobbing investment banking, syndicated loan | :04:37. | :04:45. | |
desks, and trading. -- propping up. We have seen them invest in other | :04:46. | :04:49. | |
parts of the region besides their own, which is Southeast Asia. I | :04:50. | :04:55. | |
would say in the long-run, Chinese banks are OK. For many years we have | :04:56. | :05:01. | |
reported on shadow banking. That is a real concern. That is right. The | :05:02. | :05:07. | |
origins of shadow banking go back to the Chinese banks themselves. They | :05:08. | :05:11. | |
have traditionally been very conservative with credit policy. | :05:12. | :05:14. | |
They have really preferred reaching out to a client segment that were | :05:15. | :05:22. | |
persistent clients or had credit history. As a result of this, large | :05:23. | :05:27. | |
segments in China have been sort of left out because banks would not | :05:28. | :05:33. | |
look at them. Absolutely. What is interesting is recent innovations | :05:34. | :05:43. | |
have brought P2P and on line lending companies to these. There have been | :05:44. | :05:49. | |
many innovative solutions up Illias Fifa be subsidies of Alibaba for | :05:50. | :06:03. | |
example. -- solutions. There are new ways to do this. Even if banks don't | :06:04. | :06:14. | |
want to touch someone without credit history, these P2P lenders have | :06:15. | :06:18. | |
their own models, with social media and data and on line platforms. | :06:19. | :06:27. | |
Uber's new CEO says he wants to take the company public as soon as 2019. | :06:28. | :06:35. | |
The former head of Expedia met his employees for the first time on | :06:36. | :06:38. | |
Thursday. He said an initial IPO would take place in 36 months. He | :06:39. | :06:49. | |
also said he would stem the financial losses of $3 billion. We | :06:50. | :06:54. | |
will speak to a reporter now. Is that likely? This is still a | :06:55. | :07:00. | |
tentative timeframe. Investors are excited for when it happens. Uber is | :07:01. | :07:06. | |
the world's most valuable technology company, worth $70 billion. It is | :07:07. | :07:12. | |
also the biggest loss making private company currently. It is expanding | :07:13. | :07:19. | |
so rapidly and is bleeding cash. Ever since 2009 when it was launched | :07:20. | :07:23. | |
it has failed to make money. That is top of the agenda for the CEO. | :07:24. | :07:28. | |
Before taking a public he needs to narrow losses even more and make it | :07:29. | :07:32. | |
profitable. He might be able to do this. He was at Expedia for 12 years | :07:33. | :07:38. | |
and managed to expand it to 60 countries and made it highly | :07:39. | :07:42. | |
profitable as well applied aside from the financial problems of Uber, | :07:43. | :07:48. | |
it also has a toxic work environment. Exactly. That is why | :07:49. | :07:54. | |
there is a large timeframe to be 18- 36 months. It gives him leeway to | :07:55. | :08:00. | |
fix these problems. Finances, you mentioned the toxic workplace. It is | :08:01. | :08:05. | |
a cultural problem he said he would fix. Discrimination, racism, sexual | :08:06. | :08:12. | |
harassment. Uber is also involved in legal issues with Google and | :08:13. | :08:18. | |
self-driving cars. They are also being investigated by US authorities | :08:19. | :08:23. | |
regarding foreign bribery. There is a lot to sort out. It is his first | :08:24. | :08:28. | |
week. He has a lot to do. A tough week ahead. 30 years since the | :08:29. | :08:35. | |
world's biggest economy reformed its tax code. Overnight, Donald Trump | :08:36. | :08:38. | |
launched his push for tax reform during a speech in the US State of | :08:39. | :08:44. | |
Missouri. He said he wanted to create jobs with higher wages for | :08:45. | :08:48. | |
Americans, but he lacks details. Congress had to do much of the | :08:49. | :08:53. | |
heavylifting. We have this report. The stock market is up. The | :08:54. | :08:57. | |
unemployment rate is at an all-time low. If you listen to Donald Trump, | :08:58. | :09:04. | |
he says the system is rigged. In a speech to introduce tax reform, the | :09:05. | :09:08. | |
US president told the crowd that the tax system of the country was | :09:09. | :09:12. | |
broken. His sale pitch, light on details, focused on how it would | :09:13. | :09:18. | |
benefit the middle-class. Our self-destructive tax code costs | :09:19. | :09:22. | |
American millions and millions of jobs, trillions of dollars, and | :09:23. | :09:27. | |
billions of hours spent on compliance and paperwork. One | :09:28. | :09:31. | |
proposal he has been pushing is cutting the nation's 35% corporate | :09:32. | :09:36. | |
tax rate to 15%. Those in favour say it would encourage countries to stay | :09:37. | :09:43. | |
in the US and create jobs. But not so fast. Budget experts say it could | :09:44. | :09:47. | |
cost the government $2 trillion. Critics say there is no new evidence | :09:48. | :09:51. | |
companies saving more on tax will expand their workforce. Plus, it is | :09:52. | :09:56. | |
so full of loopholes most firms already pay less. There is | :09:57. | :10:00. | |
bipartisan support to simplify the tax code of America. But given the | :10:01. | :10:05. | |
potential impact on workers and businesses in the deficit of the | :10:06. | :10:08. | |
country, modernising the rules will be a tall order to be Michelle | :10:09. | :10:13. | |
Fleury with that report. The markets that just opened in Asia. Gains for | :10:14. | :10:25. | |
the Nikkei. The All Ordinaries in Australia as well. They are taking | :10:26. | :10:29. | |
cues from Wall Street. Rosy numbers in the US. They have been advised up | :10:30. | :10:39. | |
to 3% annual growth in the second quarter. And that is it for this | :10:40. | :10:40. |