:00:00. > :00:00.Those are the latest headlines from BBC News. Now for the latest
:00:00. > :00:15.financial news, with Sally Bundock and World Business Report.
:00:16. > :00:20.The Bank of England's poised to sign a deal with China that will see
:00:21. > :00:24.London become a hub for trading in the yuan, but has Frankfurt stolen
:00:25. > :00:27.the march? And find out why entrepreneurs are
:00:28. > :00:35.choosing to launch their start`ups in India.
:00:36. > :00:41.Welcome to World Business Report, I'm Sally Bundock. Also in the
:00:42. > :00:44.programme, industrial production sinks in Japan. We digest the news
:00:45. > :00:52.on the eve of the introduction of a controversial sales tax.
:00:53. > :00:59.Let's talk about the Chinese currency. The yuan used to be a
:01:00. > :01:04.closed shop as it was tradable only in mainland China. But that is
:01:05. > :01:07.rapidly changing and soon it is expected to rival the Euro and US
:01:08. > :01:14.dollar in terms of traded volumes. No surprise that con `` petition has
:01:15. > :01:18.been stiff. The German Bundesbank and the People's Bank of China
:01:19. > :01:21.signed a deal on Friday to facilitate transactions in the
:01:22. > :01:26.Chinese currency in Frankfurt. Today, London will enter the frame
:01:27. > :01:31.`` the fray, with a memorandum finally being signed, establishing
:01:32. > :01:37.London as another hub for Chinese currency dealing. Oliver Barron is
:01:38. > :01:46.head of China research at NSBO and joins me now from Beijing. London
:01:47. > :01:49.wanted to be in prime position to offer yuan trade business in Europe.
:01:50. > :01:57.It is playing second fiddle to Frankfurt, or is it? Tell us about
:01:58. > :02:02.the latest move. I think Frankfurt certainly came first bite, in terms
:02:03. > :02:09.of Frankfurt and China, there are clear trade benefits. `` came first.
:02:10. > :02:13.I don't think it will overtake London. London will still be the
:02:14. > :02:17.natural settling place because it is already the centre for currency
:02:18. > :02:23.transactions globally, accounting for over 40% of global transactions.
:02:24. > :02:30.Many people say the yuan will become as big a traded currency as the Euro
:02:31. > :02:37.or US dollar. I read that in my introduction. `` euro. When will
:02:38. > :02:44.that start to happen? Merret currently we are in a situation
:02:45. > :02:48.where the yuan is already one of the largest traded currencies. But in
:02:49. > :02:54.terms of taking over the euro or US dollar, we have a long way to go.
:02:55. > :02:57.Investors need to be comfortable with investing in its financial
:02:58. > :03:02.system. We need to see reform. Opening up of the currency,
:03:03. > :03:05.liberalising of the capital account, before it can rival them. In terms
:03:06. > :03:10.of the constant accusation towards China about the fact that its
:03:11. > :03:14.currency doesn't float freely in the same way that other currencies like
:03:15. > :03:22.the US dollar does, where does this take China? This next step, doing
:03:23. > :03:28.deals with fractured and London, for the Chinese currency to be a freely
:03:29. > :03:33.floating currency? China likes to do things step by step. It has
:03:34. > :03:40.gradually expanded the countries with which it does trade settlement.
:03:41. > :03:46.It has swapped lines `` swap lines and is expanding markets. I think it
:03:47. > :03:49.is going to continue to grow. The offshore markets will keep growing.
:03:50. > :03:55.But it will be a step`by`step process, until we see more progress
:03:56. > :04:04.and other reform. Thank you for joining us. That deal, as and when
:04:05. > :04:08.it is announced, we will update you hear on World Business Report.
:04:09. > :04:11.This time next week Indians will be heading to the polls as the world's
:04:12. > :04:14.biggest democracy votes for a new leader and whoever gets the job kick
:04:15. > :04:17.starting economic growth will be top priority. But despite the slowdown
:04:18. > :04:20.over the past couple of years, the number of start`ups has been growing
:04:21. > :04:22.in India. And it's not just domestic entrepreneurs setting up new
:04:23. > :04:26.businesses. Some expatriates have decided this is the place to try and
:04:27. > :04:30.launch a new idea. Sameer Hashmi reports from Bangalore.
:04:31. > :04:36.This might look like a car park but in fact it is the home of one of the
:04:37. > :04:39.first companies in India that lets you hire a car and then drive it
:04:40. > :04:42.yourself. Unlike most developed countries, until recently anyone
:04:43. > :04:55.wanting to rent a vehicle here to hire a driver as well. We thought,
:04:56. > :05:00.we don't have show first so it will be cheaper... It is the creation of
:05:01. > :05:03.these two friends. The quick universities in the UK and US to
:05:04. > :05:06.move to Bangalore and start the company. A brave move because,
:05:07. > :05:11.wherever you are, launching a business is never easy. But being
:05:12. > :05:15.foreigners in India makes it tricky. A lot of people thought, these white
:05:16. > :05:18.Americans, they think they are going to come here and start a company.
:05:19. > :05:22.But as soon as things turn tough, they are going to run right back to
:05:23. > :05:26.good job opportunities in San Francisco and New York. Investors
:05:27. > :05:30.were initially reluctant for that reason. Now we have been in business
:05:31. > :05:35.for almost one year, we have proven wrong. There is really no official
:05:36. > :05:37.figure but it is estimated that over one million new small and
:05:38. > :05:41.medium`sized firms are launched in India every year. According to the
:05:42. > :05:45.World Bank, this is one of the toughest places to start a business.
:05:46. > :05:49.Mark's journey in India began six years ago when he and his wife
:05:50. > :05:57.decided to move here from the UK to start a branding and corporate
:05:58. > :06:01.communications company. I do think India is an attractive market. You
:06:02. > :06:07.have to take a long`term view on India. The next five `10 years could
:06:08. > :06:12.be very exciting in India. We remain pretty bullish about it. But clearly
:06:13. > :06:14.not without its challenges. And it's not only individuals who are
:06:15. > :06:17.optimistic about start`ups here. But investors as well. Last year,
:06:18. > :06:25.backers put $1.6 billion, US, into Indian start`ups with the e`commerce
:06:26. > :06:31.sector most popular. It's good to see this reverse kind of migration
:06:32. > :06:33.happening. It's good because you suddenly have very open, very
:06:34. > :06:39.entrepreneurial thinking, where many of us in India don't have that
:06:40. > :06:42.openness of mind. Making it easier for ex`patriots to start a business
:06:43. > :06:46.here is something the government has been talking about for a while. And,
:06:47. > :06:49.if that happens, that might tempt more foreigners like Mark to come
:06:50. > :06:52.here, not just to sample the culture, sights and food but to have
:06:53. > :06:58.a go at being an Indian entrepreneur.
:06:59. > :07:04.Its very important week for the Japanese economy, with a brand`new
:07:05. > :07:08.sales tax starting tomorrow. Today we had surprisingly bad news about
:07:09. > :07:17.the economy. In feathery, the industrial production went down by
:07:18. > :07:20.2.3%. A month on month fall. Slipping after a near 4% rise in
:07:21. > :07:29.January. Economists were expecting growth. Rico Hizon is in our Asia
:07:30. > :07:37.Business hub in Singapore. Tell us, what's going on Japan? A very big
:07:38. > :07:41.disappointment with this `` these industrial production numbers. The
:07:42. > :07:47.key industries showed very low numbers, especially automakers,
:07:48. > :07:52.manufacturers of mobile phones, personal computers and heavy
:07:53. > :07:56.machinery. Weakened factory output. You also have to add to the equation
:07:57. > :08:05.unusually cold conditions and snowstorms weighing on production.
:08:06. > :08:11.This data comes the day before the controversial national sales tax. It
:08:12. > :08:15.will be rising to 8% from 5%. Analysts say there is a possible
:08:16. > :08:18.sign that benefits from last`minute demand before the implementation may
:08:19. > :08:23.have run their course. Companies may have also curbed reduction to keep
:08:24. > :08:28.inventories low, fearing oversupply because they may be worried that
:08:29. > :08:33.demand could be weaker after this sales tax hike. Ahead of this
:08:34. > :08:38.insurgents, the Prime Minister is looking out for the bank of Japan?
:08:39. > :08:43.Key survey which will be out on the 1st of April, tomorrow. That could
:08:44. > :08:48.offer what impact the sales tax hike could have on business sentiment.
:08:49. > :08:52.Economists say the numbers suggest the economy might not rebound
:08:53. > :08:57.quickly and the burden might fall on the central bank, as the government
:08:58. > :09:03.has already committed to fiscal stimulus spending. Everything really
:09:04. > :09:05.is very tentative on what might happen to the Japanese economy going
:09:06. > :09:12.forward, with the implementation of this new tax rate from 5% ` 8%.
:09:13. > :09:15.Thank you. In other news, Italian police have
:09:16. > :09:20.arrested two men who were allegedly trying to deposit trillions of euros
:09:21. > :09:23.in fake bonds in the Vatican bank. The pair, an American and a Dutch
:09:24. > :09:26.national, claimed they had an appointment with bank officials to
:09:27. > :09:29.gain entry but were handed over to police. Fake bonds with a face value
:09:30. > :09:36.of three trillion euros, that's $4.1trillion, were found in their
:09:37. > :09:40.briefcase. The suspects were reportedly hoping to open a line of
:09:41. > :09:43.credit at the bank. The Greek parliament has narrowly
:09:44. > :09:47.approved a big reform package that will open more retail sectors to
:09:48. > :09:50.competition. The measures are part of a deal between Greece and its
:09:51. > :09:53.international lenders. They faced stiff criticism from the opposition,
:09:54. > :09:56.and some government deputies, who said the reforms will lead to more
:09:57. > :10:07.imports and damage the country's economy.
:10:08. > :10:13.It's a new trading week in Asia. Let's look at how things are shaping
:10:14. > :10:21.up. The next big star `` picture emerging. These other currencies:
:10:22. > :10:34.I will be back shortly to talk through the papers. Stay with us.
:10:35. > :10:38.Strapped`for`cash child protection agencies are acting as nothing more
:10:39. > :10:45.than an emergency service, according to a children's charity. The NSPCC
:10:46. > :10:47.says this is due to an increase in the number of abuse complaints
:10:48. > :10:48.following the Jimmy Savile