―Culture and Education and Textiles Industry in Maldives‖

Home , Economy of the Maldives, Tourism in the Maldives, Traditional fishing boat

TABLE OF CONTENT

S.N. Particulars

Part1: Economic overview of the Maldives

1 Overview of the economic

1. Production, price and employment

2.Public Finance/Fiscal Policy

3. Financial Sector and Monetary Development

4. Balance of Payments and External Sector

Part 2: Textiles industry

2 Introduction

1.Maldives‘ Textiles Industry

2.Trade structure in Maldives

3. Foreign trade regulations

3.1 Import regulations

3.2 Exports regulations

4. Finance regulation for foreign operation 4.1 Banking system

4.2 Foreign exchange system

5.Customs taxation

6. PEST Analysis

3. Comparative analysis

1 Comparative position of Textiles industry with India

2 present position and trend of export and import with India

4. Policies and norms

1.Policies and norms for Maldives for Textiles industry

2.policies and norms of India for import and export to Maldives

3.present trade barriers for import and export of Textiles

PART 1

Culture and Education of

Maldives

1. History

The Maldives has been an independent state throughout its known history, except for a brief period of 15 years of Portuguese occupation in the 16th century. Maldives has always been an independent political entity except when it was under Portuguese control from 1558 to 1573. The Maldives became a British Protectorate in 1887 and remained so until 26 July 1965. The independent Maldives reverted from a Sultanate to a Republic on 11 November 1968. The first written constitution was proclaimed in 1932.

Earliest known history of the Maldives is recorded in these metal tabs known as "loamaafaanu", according to which it seems certain that the islands of Maldives were first settled by Aryan immigrants who are believed to have colonized Sri Lanka at the same time, (around 500 BC). Further migration from South India, as well as Sri Lanka, occurred. The latest archaeological findings suggest the islands were inhabited as early as 1500 BC.

Around 947 AD, recorded contact with the outside world began with the Arab travelers. One can imagine accounts taken home depicting the potential for trade in pearls, spices, coconuts, dried fish, and certainly the abundance of cowry shells. The cowry shells were the accepted currency from Africa to China until the sixteenth century. Together with the description of the exotic paradise islands and expensive natural resources, the news the travelers must have taken home probably resulted in the arrival of more ships bearing traders and other travelers.

The Maldives is one of the world's poorest developing countries. It is threatened by global warming because of its very low elevation. The main natural resources are fisheries and a marine environment conducive to tourism. The other constraints it faces are small and widely dispersed island communities, limited skilled human resources, and rapid population growth.

Orientation

Location and Geography:-

The Republic of Maldives is an archipelago consisting of twenty-six coral atolls, in the northern Indian Ocean. The chain of islands extends 510 miles (820 kilometers), but occupies an area of just 116 square miles (300 square kilometers), roughly 1.5 times the size of Washington D.C. The closest neighbors are India and Sri Lanka. The capital is Male.

The twenty-six coral atolls contain 1,190 very small islands of which 198 are inhabited. Most of the islands are close to the atoll enclosure reef, and some are still in the process of forming. The longest is Gan in Adu atoll. Because the islands are coral-based, they are flat and low-lying

Demography:-

In 1996, the population was 256,157, compared with 195,000 in 1986; the estimated population for the year 2000 is 289,117. The annual rate of population growth is almost 3 percent. Almost most half the population is under fifteen years of age, and about 3 percent is sixty five years and older. About 25 percent of the population resides in Male. The growth rate in Male atoll has been high as a result of employment opportunities offered by growth in the service sector. Even though income in Male is significantly higher than that in the atolls, the resulting rural-urban migration has led to increasing unemployment. Emigration from the republic is rare except for educational purposes or to work as a crew member on Maldivian ships.

Symbolism:- The national flag is red with a large green rectangle in the center bearing a vertical white crescent on the hoist side. The country is associated with the "Maldives fish" (boiled sun- dried tuna).

National Identity:-

The Maldives regained full sovereignty in 1965 and joined the United Nations that year. In 1968, the sultanate was abolished and the republic was declared. On 11 November 1968, the Republic of Maldives was created with an elected president. The country joined the British Commonwealth in 1982.

Ethnic Relation:-

The population consists of a mix of people who trace their descent from Sri Lanka, India, Arab countries, and Africa. Because of religious and linguistic homogeneity, there is stability and unity.

Culture

The islands of Maldives appear in-between the trading route of the Indian Ocean. Thus settlers and visitors from neighboring regions and around the world have come in contact with the islands for as long as history has been recorded. Such is the to-and-fro flow of people and their cultures that a marked effect has been left in the Maldivian people, the language, beliefs, arts, and attitudes.

The looks of the Maldivian people may differ from one atoll to the other, attributing to the genes passed on by South and Southeast Asians, Africans, and Arabians. The language, Dhivehi, differs in dialect in some regions in the south of Maldives, possibly due to the secluded nature and subsistent ways of island life. Maldivian beliefs have been very much based around religion and superstition, often used together in matters of significance but given separate positions in society. In matters of faith, Islam dominates, but influence of the supernatural still continues to play a major role in most island communities, possibly giving credit to the folklores and Buddhist traditions of the islands‘ first settlers before conversion to Islam in 1153 AD.

The distinct geometric designs used in mats woven from local materials, the embroidered neckline of women‘s traditional dresses and their ornaments too, expose another story brought in from an unknown culture that has seeped in to Maldivian society.

Maldivians are quite open to adaptation and are generally welcoming to outside inspiration. The culture has always continued to evolve with the times. Locals still eat fish and fishermen still spend days out at sea, but tourism now takes a standing prominence. Most Maldivians still want to believe in upholding unity and oneness in faith, but recent waves of reform in the country have created a whole new culture of new ideas and attitudes. The effects of the modern world are now embraced, while still striving to uphold the people‘s identity, traditions and beliefs.

Food in Daily Life:-

Rice and fish are the staple foods. Fish is the most important source of protein in the average diet. Very few vegetables are eaten. Betel leaf with areca nut, cloves, and lime, known as foh, is chewed after meals. Old people smoke guduguda, an elongated pipe that goes through a trough of water. Most food served in tourist resorts is imported.

Food Customs at Ceremonial Occasions:-

Meat other than pork is eaten only on special occasions. Alcohol is not permitted except in tourist resorts. The local brew, raa , is sweet toddy made from the crown of the coconut palm.

Class and Castes:- A disproportionate share of government expenditures directly benefits Male and ensures its residents a standard of living that is substantially higher than that in the atolls. Status is derived primarily from wealth rather than family, although family ties and connections are important in determining the availability of opportunities. One's position with the government also confers status, while education is less important.

GENDER ROLES AND STATUSES:-

 Division of Labor by Gender

Over 25 percent of women are employed, primarily by the government. The government sector employed 15,862 people in 1996, approximately 64 percent males and 36 percent females. Women in the atolls generally are employed only in domestic or selected duties within the family, such as tending crops and producing general handicraft items such as coir rope and woven coconut palm leaves for domestic use. Women also collect cowrie‘s shells from the shores.

 The Relative Status of Women and Men

Women make a significant contribution to social, political and economic affairs. The economic sectors in which women are employed are education, health and welfare, services, tourism, transport, and communication.

MARRIAGE, FAMILY AND KINSHIP:-

 Marriage. The legal age for marriage is eighteen, although half of the women marry by age fifteen. Marriages are not arranged. In accordance with Islamic law, a man can have four wives at any time if he can support them financially, but polygamy is uncommon. Sex before marriage is a punishable offense. Marriages can take place only between Muslims. Maldives has one of the highest divorce rates in the world; according to a 1977 census, nearly half of the women over the age of thirty had been married four times or more.  Domestic Unit. Unlike households in many other Muslim countries, households in Maldives typically do not include extended family members. Nuclear families consisting of a married couple and their children comprise roughly 80 percent of the households, with the father typically recognized as the head of the family. Unmarried persons generally live with their families rather than by themselves.  Inheritance. Both men and women may inherit property.  Kin Groups. The island communities outside of Male are generally close- knit, self-contained groups in which most everyone is related through generations of intermarriage.

SOCIALIZATION:-

 Child Rearing and Education.

Primary level education is for five years and secondary education is in two stages: five years at the lower level and two years at the higher level. Education is not compulsory. There are three streams of Maldivian education: traditional religious schools (makhtabs), which teach the Koran (Qur'an), basic arithmetic, and the ability to read and write Divehi; modern Divehi- language primary schools; and modern English-language schools. Primary and secondary schooling is based on the British educational system.

 Higher Education.

Maldivians must go abroad for higher education. Currently the Science Education Centre in Male provides pre-university courses, and the Centre may evolve into a university.

RELIGION:-  Religious Beliefs. Islam is the only national religion; no other religions are permitted. All Maldivians belong to the Sunni sect. Only Muslims may become citizens, marry, or own property in Maldives, and daily life is regulated according to the tenets of Islam. The widespread belief in jinns, or evil spirits, has resulted in a blending of Islam with traditional island beliefs into a magico-religious system known as fandita.

Talking about the Maldives religions, people out here have a deep faith in Islam and all the people are Sunni Muslims. Therefore, the major religion of Maldives is Islam. People of Maldives are very religious and offer prayers five times a day in the mosque. Maldivians have a strong belief in afterlife and they are of the opinion that it is decided on the basis of deeds, whether the person will go to hell or heaven. Read on to know more about the religions in Maldive

 Religious Practitioners

The political, judicial, and religious systems in Maldives are so closely intertwined that the political leaders and judges are also the country's religious leaders. The president is considered the primary religious leader, and judges, known as gazis, are responsible for interpreting Islamic law in the courts.

 Rituals and Holy Places

Most holidays are based on the Islamic lunar calendar. In addition to the Golden Grand Friday mosque, twenty other mosques are scattered around Male. Mosques are also found in each of the islands. In Male, a graveyard holds the tomb of Abu Al Barakat, a North African Arab who brought the Koran to the Maldives in the twelfth century. He later became the first sultan. Also located in this graveyard are tombstones of all the former sultans.

 Death and the Afterlife.

In accordance with the Islamic faith, the people of Maldives believe that people go to heaven or hell after death, depending on how faithfully they adhered to the five tenets of Islam while still alive. Believers are considered worthy to enter heaven if they were faithful to repeat the creed "There is no God but Allah, and Muhammad is the prophet of Allah"; fast during the month of Ramadan; pray five times every day; give alms to the poor; and, if possible, make a pilgrimage to the holy city of Mecca sometime during their lifetime.

Maldives Languages

Talking about the Maldives languages, Dhivehi is the main language spoken in Maldives. The language is widely used for conversing with people. Since, it involves the use of many English, Hindi and Arabic words, it seems to resemble various languages spoken in Sri Lanka, South East Asia and North India. Read on to know more about the common languages of Maldives

Dhivehi, which is spoken in all parts of the country, is not spoken in any other part of the world. It is considered an Indo-European language related to Sinhala, the language spoken in Sri Lanka. The alphabets and writing system are similar to Arabic. English is the second language and is widely used in commerce and in many government schools.

Maldives People

People of Maldives Island are very warm and friendly. They have a strong faith in Islam. Highly spiritual and dedicated, Maldives people have a great respect towards each other and outside visitors. Maldivians reflect a blend of tradition and modernity. Intelligent and hardworking, they have been making significant contributions in the economy of the nation.

Secular Celebrations:-

Kudaeid celebrates the sighting of the new moon at the end of Ramadan, and the Prophet Mohamed's birthday is also celebrated. National Day, the day Mohammed Thakurufaan overthrew the Portuguese in 1573, occurs on first day of the third month of the lunar calendar. Victory Day on 3 November celebrates the defeat of the Sri Lankan mercenaries who tried to overthrow the government. Republic Day on 11 November commemorates the foundation of the current republic

 Maldives Music and Dance  Maldives is not just admired for its beauty but also it is known for its fabulous dances and music. When it comes to music and entertainment, this gorgeous island has so much to offer. In this section, we will provide you with information on the Maldives music and dance. We will brief you on the prominent forms of folk dances and music of Maldives. The Maldivian culture is rich with flavors from most of the seafarers who set foot on its soil. Traditional dances and music may not be an everyday event but there are occasions where traditional music and dances are performed. Though traditional dresses are not used by present day generation there are many types of traditional dresses made for both sexes. Like the unique geographical formation, the cultural events and ceremonials are unique according to the event that is celebrated or performed. Naming a newborn child, Bodumaloodhu (a prayer accompanied with festive meal), Eid festival and circumcision of male child are few events that take place where the taste of rich cultural 'cocktail' can be experienced. Bodu beru (big drum) performance is the best-known form of performance of traditional music and dance where females and males participate. Bandiyaa (a dance performed by woman), Thaara (dance performed by male) is among the top traditional music and dances practiced in the Maldives Islands. Traditional food basically fish used as the main component has been influenced from the Indian subcontinent. Garudhya (tuna soup), spicy curry and rice are the stable food of most of the population. Most other dishes such as western meals like pasta are normally modified with a flavor of tuna in it when prepared for local consumption. Other meats and chicken are normally eaten in special occasions.

 Maldives Cuisine Being an assemblage of several coral islands, it is pretty obvious that Maldives cuisine would consist of a wide variety of seafood. At the initial level, it was basically coconuts and fish that formed part of Maldives traditional food. It can be attributed to the fact that there was limited cultivation. Honey was extracted out of the coconut toddy and used as a replacement of sugar. The cooking style of Maldives is highly influenced by India and Sri Lanka. Read to know more on the cuisine of Maldives.

Education

Maldivians attach great importance to education, and as such Maldives throughout its known history have provided education to its people to varying degrees, and at different levels. Seven percent of our GDP and 20 percent of our total expenditure is spent on education. Maldives also receives aid from international donor agencies and countries. The Maldives has had a long history of semi-formal religious-based education for the masses and this is still practiced today. The traditional system consisted of children gathering in homes called ‗edhuruge‘ to learn Dhivehi language and the Arabic script and to learn to recite the Holy Quran. In addition, there were schools for young adults for navigation, languages, and for Muslim theology. Although educational attainment in the traditional system is low in terms of performance in formal examinations, the system has contributed towards achieving many educational objectives – the most important of which is the relatively high rate of literacy and the preservation of national culture and tradition. The initial challenge to this traditional system occurred in 1927 with the Establishment of the first government school in Male‘. This school was first limited to the education of boys but later in 1944 a section was opened for girls and young women. Instruction in this school covered Dhivehi language, Islam, Arabic and Arithmetic. By 1945 each inhabited island hada traditional school (maktab) providing instruction at the lower primary level. The most recent historic development in education in the Maldives occurred in 1978, with the decision to move to a unified national system of education and to promote a more equitable distribution of facilities and resources. The policy focus was on providing Universal Primary Education for All and thus the strategies involved the formulation of a unified curriculum for Grades 1-7, improvement of teacher training and the establishment and upgrading of new schools in the atolls. Two government schools (one Atoll Education Centre (AEC) and one Atoll School (AS)) were established in each atoll and today these schools represent the availability of high quality basic education for the children in their locales. Recent educational development of the country is characterized by a very rapid increase in student enrolment and the number of educational institutions. During this period, the provision of basic education remained the main priority of the sector for a number of years. Many schools have been constructed, a national curriculum was introduced and later revisions were carried out, and local textbooks and teacher guides have been developed for all the primary education grades.

Primary and secondary education:-

Only primary and secondary education, neither of which is compulsory, is offered in Maldives. Students seeking higher education must go abroad to a university. Maldives has three types of schools: Quranic schools, Dhivehi-language primary schools, and English- language primary and secondary schools. Schools in the last category are the only ones equipped to teach the standard curriculum. In 1992 approximately 20 percent of government revenues went to finance education, a significant increase over the 1982 expenditure of 8.5 percent. Part of the reason for this large expenditure results from recent increases in the construction of modern school facilities on many of the islands. In the late 1970s, faced with a great disparity between the quality of schooling offered in the islands and in Male, the government undertook an ambitious project to build one modern primary school in each of the nineteen administrative atolls.

The government in Male directly controls the administration of these primary schools. Literacy is reportedly high; the claimed 1991 adult literacy rate of 98.2 percent would make Maldives the highest in South Asia and the Indian Ocean region.

In Maldives primary education comprises classes one through five, enrolling students in the corresponding ages six through ten. Secondary education is divided between classes six through ten, which represent overall secondary education, and classes eleven and twelve, which constitute higher secondary education. In 1992 Maldives had a total of 73,642 pupils in school: 32,475 in government schools and 41,167 in private schools.

Traditionally, education was the responsibility of religious leaders and institutions. Most learning centered on individual tutorials in religious teachings. In 1924 the first formal schools opened in Male. These schools were call Edhuruge, and served as Quranic schools. Edhuruge were only established on two other islands at this time. The basic primary school on the islands in the 1990s is the makthab, dating from the 1940s. Primary schools of a slightly larger scale in terms of curriculum, enrollment, and number of teachers, are called madhrasaa. During the 1940s, a widespread government campaign was organized to bring formal schooling to as many of the inhabited islands as possible. Enthusiastically supported by the islanders, who contributed a daily allotment of the fish catch to support the schools, many one-room structures of coral and lime with thatched roofs were constructed. The makthab assumed the functions of the traditional edhuruge while also providing a basic curriculum in reading, writing, and arithmetic. But with the death of reformist president Didi and the restoration of the sultanate in the early 1950s, official interest in the development of education in the atolls waned.

Throughout the 1960s, attention to education focused mainly on the two government schools in Male. In 1960 the medium of instruction changed from Dhivehi to English, and the curriculum was reorganized according to the imported London General Certificate of Education. In the early 1990s, secondary education was available only in Male's English-medium schools, which had also preschool and primary-level offerings. Dhivehi-medium schools existed, but most were located in Male. These schools were private and charged a fee.

As of the early 1990s, education for the majority of Maldivian children continues to be provided by the maktab. In 1989 there were 211 community and private schools, and only fifty government schools. The results of a UN study of school enrollment in 1983 showed that the total number in the new government primary schools on the atolls was only 7,916, compared with 23,449 in private schools. In Male the number of students attending government schools was 5,892, with 5,341 in private schools. Throughout the 1980s, enrollment continued to rise as more government-sponsored schools were constructed in the atolls. In 1992 the first secondary school outside Male opened on Addu Atoll.

Training program:-

In 1975 the government, with international assistance, started vocational training at the Vocational Training Center in Male. The training covered electricity, engine repair and maintenance, machinery, welding, and refrigeration. Trainees were chosen from among fourth- and fifth-grade students. In the atolls, the Rural Youth Vocational Training Program provided training designed to meet local needs in engine repair and maintenance, tailoring, carpentry, and boat building. On the island of Mafuri on Male Atoll, a large juvenile reformatory also offered vocational training. Established by the Ministry of Home Affairs in 1979, the reformatory provided training courses in electrical and mechanical engineering, carpentry, welding, and tailoring, as well as a limited primary school academic curriculum.

International organizations enabled the creation of the Science Education Center in 1979 and an Arabic Islamic Education Center opened in 1989. Japanese aid enabled the founding of the Maldives Center for Social Education in 1991. In the latter half of 1993 work began on the Maldives Institute of Technical Education to help eliminate the shortage of skilled labor.

Government Policy:-

The Ministry of Education (MOE) is the government body responsible for education in the Maldives. With recent changes in the government organizational setup, the work of MOE has changed with the focus of providing ―school‖ education to Maldivians, both formally as well as informally; and higher education and training has been removed from its mandate. The various responsibilities of MOE are delegated to its different sections and educational institutions functioning directly under its supervision, as well as schools. The Ministry also sets guidelines and monitors the service of private and community educational institutions including schools and Since the re-conceptualization of the education policy in 1978, remarkable progress has been made in the sector. Early childhood care and education has been expanded, primary education has been universalized, secondary education has seen marked growth, illiteracy has been nearly eliminated, and higher secondary opportunities have been expanded by establishing several schools in the atolls.

Investment in Education The government expenditure for education was 8% of GDP in 2006. Literacy in Maldives is high at 97%. Maldives has made great strides over the years in primary and lower secondary education, with 100% enrollment in the primary level (grade 1 to 7) since 2002. Secondary school enrollment has also improved significantly, with about 70% progressing to secondary level. Lower secondary schools (grades 8 through 10) are located on 138 islands. As of 2008, the government aimed to make 10 years of education available to all before 2010. Only a small proportion of children leave school with a qualification, and "Ordinary level" pass rates (at the completion of grade 10) are low for those who opt to take the examination. As of mid- 2007, access to higher secondary schools (grades 11 and 12) was limited as schools were located on just 14 islands. Access to tertiary education is more limited. Although there is no gender bias for primary and lower secondary schools, there is a bias in favor of boys for upper secondary and tertiary education.

Overview of the Education System:-

There are three categories of schools in the Maldives: government, ward/community and private schools. Although education is provided largely by the government, the community and the private sector also play an active role. The government supports community and private schools by providing a certain percentage of teachers depending on school size, and by providing infrastructure, facility support and financial subsidies. In order to minimize the differences in giving provisions to schools, 135 community schools in the atolls were converted to government schools in 2005. In the capital, Male, formal schooling is preceded by two years pre-primary education in the lower and upper kindergarten. This form of pre-primary education is now increasing in the atolls, especially in highly populated islands. The alternative to this form of education is edhuruge (traditional learning centres based in the house of a learned person).

II. PRODUCTION, PRICE AND EMPLOYMENT

Maldives has achieved robust growth during the period under review. Both per capita income and per capita GDP have risen substantially, accompanied by a marked improvement in social indicators during this period. Real GDP grew at an average rate of more than 7% for the review period, stimulated by a strong rebound of the tourism sector following the Asian tsunami and the boom in construction industry. But with the current global turmoil, the economy is expected to grow at a modest rate of around 1.3%.

They are also the major sources of foreign earnings, accounting for 31% of the GDP at the end of 2008. The construction and real estate sectors have become one of the most dynamic sectors in the economy, contributing to a considerable extant to the sustained high growth rate of the economy during the review period. At the end of 2008, these sectors taken together contributed 12% to GDP.

As Maldives is a highly open economy, domestic price movements are very much influenced by price developments in the international market. Price movements in the domestic economy during 2008 were largely influenced by soaring global food and oil prices coupled with high domestic fish prices, which reached peak levels during the first half of the year.

Another major factor, perhaps, the most significant factor, which contributed to higher inflation, was the rise in demand for gods and services due to the increase in money supply. This increase in due to the monetization of the government budget via the Central Bank (the Maldives Monetary Authority –MMA). At the end of 2008, inflation in the economy was recorded at 12.3%.approximately a 20% increase compared to 2006.

III. PUBLIC FINANCE/FISCAL POLICY

Government involvement in the commercial activities is still strong, with around 20 state-owned enterprises (SOEs) dominating the delivery of a wide variety of services and goods. Most of these enterprises operate on the basis of monopoly concessions granted by the regulatory and policy ministries.

The new government, sworn in on 11th November 2008, is committed to reduce government involvement in commercial activities. The main reason for this policy change is to increase efficiency, transparency and accountability of the enterprises, and also to create and distribute wealth among the people of the country on a more even basis. The government‘s fiscal policy aims to reduce the level of government expenditure, while increasing revenues through sustainable measures, and thereby to reduce the large deficit that have accured over past years.

Domestic revenue growth for the period 2003 to 2005 was on average 12%. However revenues increased by 40% in 2006, largely due to ad-hoc measures such as advance lease rent payments on the islands which were leased in 2006 for development of new resorts. Growth in 2007 was again fuelled by such advance payments, as well as by increased import duty receipts resulting from higher imports of building materials due to the boom in construction, especially in the tourism sector.

Growth in domestic revenues declined in 2008, as the advance lease rent payments levelled off. For 2009, according to the initial budget that was passed, revenues are estimated to decline by 9% for the year.

The declining and highly vulnerable sources of domestic revenue, combined with sharp increases in expenditures over the past two to three years, have led to unsustainable deficits which have been largely financed through domestic sources, mainly through borrowing from Central Bank. The option of borrowing from the public has not been possible, owing to the absence of a well- developed financial market, and of government debt instruments.

(i) Financial sector and monetary development

The financial sector in Maldives very narrow and is dominated by the banking sector. The banking sector consists of one locally owned commercial bank and branches of five foreign owned commercial banks. In addition to commercial banks, the sector consists of many non- bank financial institutions. These include insurance companies, a finance leasing company, specialized housing finance institution, money services businesses and securities market intermediaries.

The MMA is also endowed with the regular powers and obligations of a central bank under MMA Act (1981). It formulates and implements monetary policy and advises the Government on issues relating to the economy and financial system in order to foster an environment conducive to the orderly and balanced economic development of the country.

The Governor and the Deputy Governor are appointed by the President with the approval of the Parliament. Other members of the Board of Directors are appointed by the President on the recommendation of the Governor. The Board of Directors of the MMA is responsible for the policy and affairs of the Authority.

Capital market activities in Maldives have grown rapidly within the past few years. The Maldives Security Act (MSA) 2006 set up the Capital Market Development Authority (CMDA), which acts as a specialized agency regulating the securities market intermediaries and also has statutory powers to license these intermediaries including brokers, dealers and investment advisers, as well as stock exchange and central depositories. Prior to this Act, the regulation and supervision of securities market was carried out by MMA.

Introduction

The Maldives government has followed a policy of free market economy, making it one of the most liberal in the developing world. This has had considerable benefits. The promotion of a favorable economic climate has assisted the economy's inflow of foreign direct investment. This doubled from an annual average inflow of $5 million between 1988 and 1993 to $10 million in 1999. But with the economy's high level of dependence on just 2 economic sectors—fisheries and tourism—it is highly susceptible to constant fluctuations on world markets. Total dependence on imports to supply a number of its sectors, such as textile manufactures and tourist supplies, means that the rise and fall of the rufiyaa on international money markets can significantly affect the competitiveness of exports and cost of imports. The simultaneous decline of fisheries exports and influx of tourists in the early 1990s led to a serious deficit in the national balance of payments that required the government to introduce unpopular cuts in public spending. Compared to the other Maldives, Male is highly developed. Some of the other islands have benefited from the carry-over effects of the tourism sector, the availability of arable land, or from the collection service for fish catches provided by the government. However, the geographical isolation of a significant number of islands means that their access to the productive sectors of the economy and to social services is very limited. The government has initiated a set of policies to address these disparities and spent 28.7 percent of its 1999 budget on atoll development.

This was done in part to take the strain off the high population density in Malé and also to allow more of the outlying population access to the strategic economic situation of the capital. One example is Villingili, a nearby former resort island, which was transformed into a residential island with a commercial harbor. It now supports around 15,000 Maldivians. A similar government policy is to provide infrastructure and facilities to regional centers throughout the atolls to encourage people to move from isolated islands to local commercial focal points and develop the economy in a more unified trajectory.

Although the Maldives has benefited considerably from growth over the past 20 years, there are a number of factors that act as considerable limitations on the continued sustainable development of the economy.

Rising population growth and such factors as the rise of tourism and the mechanization of the fishing fleet has meant that imports have risen significantly, especially for such commodities as petroleum products. Consequently, whereas exports only rose from $8 million in 1980 to $64 million in 1999, imports expanded from $29 million to $402 million. Although the total national balance of payments remained at an annual average of $7 million in credit between 1994 and 1999, the serious drain of imported goods limits the potential of reinvestment and development on the islands.

PART 2

TEXTILE INDUSTRY IN

MALDIVES

Textiles industries

Maldives’ Textiles Industry

The production of clothing is the second most important export commodity for the Maldives. Those produced for export are processed at garment factories set-up in Seenu, Kaafu, Haa Dhaalu and Laamu atolls, with foreign investment. However, the income generating capacity of the industry has declined considerably over the last five years. The high cost of expatriate labour and competition from better-established garment factories such as in Vietnam has led to the closure of a number of factories. One of the objectives of setting up the garment factories was to create employment opportunities in atolls. However, that objective was not achieved as most of the factories relied on a large expatriate workforce.

2. TRADE STRUCTURE:

2.1 Main imported and exported products:

Main imported products Main exported products

Manufactured goods Fish

Machinery and equipment Garments

Food products Coconut

Rope

Handicraft

2.2 Main Trading partners:

Main suppliers Main customers

Singapore Germany

Qatar Pakistan

Malaysia Sri Lanka

India United Kingdom

United Arab of Emirates U.S.A

3. FOREIGN TRADE REGULATIONS:

3.1 Import regulations:

Imports from Israel are prohibited. Import operations may be conducted only after being registered and licensed at the Ministry of Trade and Industries. All goods may be imported under open general license, but most staples are imported by the state Trading Organization.

3.2 Exports regulations:

Export operations may be conducted only after being registered and licensed by the Ministry of Trade and Industries. The private sector may Export most items, except fresh and frozen tuna.

4. FINANCIAL REGULATIONS OF FOREIGN TRADE OPERATIONS

4.1 Banking system: Maldives Monetary Authority (MMA) is the central bank in Maldives. The Bank supervises and regulates commercial banks and foreign exchange dealings and advises the Government on Banking and Monetary matters.

The banking system is formed by:

Foreign Banks are bank of Ceylon. Habib bank Ltd. and State Bank of India;

Commercial bank: Bank of Maldives LTD (BML);

Insurance: Allied Insurance Co of the Maldives (Pte) Ltd.

4.2 Foreign exchange system:

There is no exchange control legislation. No distinction is made between accounts held by residents and those held by non residents and there is neither restriction on keeping foreign currency balances, nor on payments for invisible.

5. CUSTOMS TAXATION:

Duty rates in Maldives range as follows:

From 5 percent to 20 percent on daily necessities and essentials ;

From 10 percent to 25 percent on items essential for development of domestic industries ;

From 25 percent to 35 percent on items that will enhance the economic welfare of the country ;

From 35 percent to 200 percent on luxury items;

Some personal items, medicines, staples, and textbooks are exempt from import duties.

Duties are payable in local currency.

PEST Analysis Political Analysis

The Republic of Maldives has a parliamentary style of government with a strong executive. The country has a largely Muslim population and the laws of the country are consistent with Islamic Shari‘ah law. A republic since 1968, there is a unicameral Parliament, the People's Majlis, with 50 members (42 elected by popular vote, appointed by the President). The Office of the President is the most powerful political institution. The President appoints the Cabinet and members of the judiciary and is both the Chief of State and Head of Government. The President is also Commander in Chief of the armed forces, Minister of Defense and National Security, Minister of Finance and Treasury, and Governor of the Maldivian Monetary Authority. Women have the right to vote in all elections and are eligible for candidature to elected bodies and all public positions, except that of Head of State. The present Constitution, which came into force in 1998, does not provide for an independent judiciary and therefore could be subject to executive influence. The President has the authority to review High Court decisions and through his power to appoint and dismiss judges without confirmation by the People‘s Majlis, he can influence the judiciary. President Gayoom, who was first elected in 1978, is presently serving his sixth consecutive term. In June 2004, as a result of strong public demand for reform, he announced a programme of important constitutional changes which have the potential to transform the Maldives to a multi-party democracy. Since 2004, frustration with the slow pace of reform has led to internal unrest. The international community has pushed for the reforms to be adopted. In March 2006 the government made public a ―road map for the reform agenda‖ which takes the form of an ambitious timetable of measures, broken down into the strengthening of governance system, human rights protection, independence of the judiciary, modernisation of the electoral system, enhancement of the role of the media and development of a multiparty political system. This road map contains useful measures to strengthen the democratic system. The key component is the commitment to an election under a new multi-party electoral system, to be held in 2008.

Economic Analysis

The small size of its economy, which is largely dependant on tourism and fisheries, makes the Maldives vulnerable to external shocks. The low-lying islands of which the country is composed are particularly vulnerable to natural risks, as witnessed by the economic recession following the tsunami of December 2004. The country‘s lack of land-based natural and mineral resources means that virtually all economic production is highly dependent on imports, creating a heavy dependence on foreign exchange earnings. Intensive agricultural production is limited because of the hypercalcic soil. All staple foodstuffs, necessities and items for the tourism industry have to be imported.

Despite its natural disadvantages, the country has achieved sound growth over the past two decades, mainly through the development of its tourism and fishing industries. Tourism has grown significantly (from 195 000 arrivals in 1990 to 617 000 in 2004) and currently accounts for 33% of GDP, a quarter of total employment and more than 60% of the Maldives' foreign exchange receipts.

Fisheries is the main activity outside of Male‘ and the tourist islands. It employs 19% of the country‘s labour force but accounts for only 6% of its GDP. Fisheries exports are mostly canned and fresh tuna, which is the second largest source of foreign exchange for the country. Industry, which consists mainly of garment production, boat building, and handicrafts, accounts for about 15% of GDP.

Social Analysis

Poverty in the Maldives stems primarily from regional disparities in living conditions related to the remoteness of the islands and the lack of infrastructure and social services in the atolls. Women are particularly susceptible to isolation, as the culture of the country limits their ability to travel to other islands for employment or education. Just under half the population earn less than $1.25 per day and the average income of three quarters of the population is $1.60 per day. 7 The population of the Maldives is relatively young, with 44% under 14 years of age. Primary education facilities are adequate but there is a shortage of secondary education facilities, particularly in the more remote atolls. Three quarters of the prison population are serving sentences for drug offences, and the authorities have yet to develop a strategy to tackle the problem.

India’s Garment Industry

India is replete with natural resources like cotton, jute and silk. Indian products were known for fine designing, embellishment and craft. Besides this the ancient Indian fabric designers and weavers were one of the best in the world (Reference: The Dhaka Muslin-one of finest and light weight weaving that could pass through a finger ring)

Indian textile Industry is also largest employer (after agriculture) of workers directly and indirectly. Due to ethnic diversity and cultural multiplicity besides racial traces in India's hinterland, several designs and variety of costumes and apparels are used that enrich Indian textile garments design possibilities.

Industry plays significant role by contribution of 4% of GDP and 20% to the Indian exports kitty. Indian textile Industry is completely self reliant in the entire value-chain from cotton crop to Hi-fashion garment making.

India has around 40 Million Spindles (23% of world) and 0.5 million rotors (6% of world capacity). India has 1.8 Million Shuttle looms (45% of world capacity), 0.02 Million shuttle less looms (3% of world capacity) and 3.90 Million handlooms (85 % of world capacity). The Industry is highly fragmented except for spinning sub-sector and thus manually intensive. This is obvious from data of weaving sector mentioned above.

Garments in India

Garmenting and Knitting de-reserved to allow the units to grow bigger to be Able to service large orders and large clients Labor laws in India become industry friendly Garment parks come up in key regions giving a boost to exports Successful Quota Phase-out without exports getting restricted by QRs.

Reasons behinds the development of garment industry in terms of export import scenarios

Garment importers from all across the world prefer to trade with garment exporters India owing to the numerous benefits they get by purchasing our products. Following are some of the fundamental reasons behind the rise of Indian textile Industry and its fame amongst the traders of the European countries:

Ever since Independence, the country‘s government authorities have passed several laws for the development of our country‘s very own garment industry. Reforming the policies of foreign trade laws has also boosted the growth of this sector.

Due to the affects of globalization and technology transfer, several advanced and hi-tech production methods and machinery has been introduced. This has led to an overall development of the industry.

Overviews of Business and Trade at International Level

Maldives - International trade

The Maldives is increasingly relying upon imports. This is due to a lack of agricultural production and fossil fuel resources, a growing population and household incomes, and the high influx of tourists since the 1970s who demand certain foodstuffs and luxuries. In 1977, imports totalled $11.1 million, whereas by 1998 they had boomed to $354 million. The Maldives receives its imports from a wide range of countries. The European Union countries supplied $65 million in 1998, of which the 2 largest partners, the UK and the Netherlands, provided $18.5 million and $12.5 million, respectively. In the same year, Singapore

Trade (expressed in billions of US$):

Maldives

Exports Imports

1975 .003 .007

1980 .008 .029

1985 .023 .053

1990 .052 .138

1995 .050 .268

1998 .076 .354

0.45 0.4 0.35 0.3 0.354 0.25 0.2 0.268

0.15 0.138 0.1 0.053 0.076 0.05 0.029 0.052 0.05 0.0030.007 0.008 0.023 0 1975 1980 1985 1990 1995 1998

Export Import

Supplied $40.9 million in imports, India $39.3 million, Malaysia $34.9 million, Sri Lanka $30.9 million, the United Arab Emirates $23.8 million, Japan $22.3 million, and the United States $19.1 million.

Maldivian exports totaled $76.2 million in 1998— a considerable growth from a 1977 level of $4.8 million. The main destination was the EU countries, which consumed $20.1 million. The UK was the primary partner here and purchased $14.7 million in Maldivian exports, Germany imported $5.1 million. Exports to the United States totaled $15.7 million, nearby Sri Lanka $13.1 million, Japan $10.9 million, and Thailand $9.8 million.

The Republic of Maldives is an active member of the South Asian Association for Regional Co- operation (SAARC), whose other members are Bangladesh, Bhutan, India, Nepal, Pakistan, and Sri Lanka. Of these countries, the Maldives can boast the second highest GDP growth in the 1990s and the highest level of average individual incomes.

(2) IMPORT QUANTITY OF TEXTILE FIBRES (TOTAL) IN MALDIVES - 2004- 2011

Year Amount in ($)

2004 63

2005 78

2006 32

2007 60

2008 50

2009 100

2010 112

2011 120

(3) IMPORT VALUE OF COTTON CARDED,COMBED IN MALDIVES- 2004-2011

Year Amount in ($)

2004 63

2005 74

2006 28

2007 59

2008 50

2009 99 2010 112

2011 103

(4) IMPORT VALUE OF COTTON WASTE IN MALDIVES

Year Amount in ($)

2004 0

2005 4

2006 2

2007 0

2008 0

2009 1

2010 0

2011 16

(5) EXPORT OF TEXTILES IN INDIA 2009-11

Items 2009-10 2010-11

Rs. Crore Rs.crore

Readymade garment 24341.69 21807.76

Cotton textiles 9063.90 13896.25

Man made textiles 9405.93 9409.19 Wool and woolen textiles 1316.35 1017.02

Silk 1465.11 1251.36

Handicraft 2049.60 2362.50

Coir manufacturer 381.48 332.81

jute 538.92 1082.85

FINDING

 Import quantity of textile fibres in Maldive 2011 Amount in ($) 120.

 Import value of cotton carded, combed in Maldives 2011 amount in ($) 103.

 Export of textiles in India items of readymade garment, cotton textiles, manmade textile, wool & woolen textile, silk, handicraft, coir manufacturer, jute.

 Duties are payable in local currency in Maldives.

 Main export product is fish, garments, coconut, rope & handicraft.

 Main import product is manufactured goods, machinery & equipment, food products.

REFERENCES:

www.everyculture.com

www.mongabay.comwww. www.everyculture.com

www.mongabay.com www.indianmba.com www.themaldives.com www.state.gov www-rohan.sdsu.edu www.indiantextilemagazine.com en.wikipedia.org www.mongabay.com www.fibre2fashion.com www.eximbankindia.com wikitravel.org www.countryfacts.com

EXPORT-IMPORT OPPORTUNITIES

EXOTIC VEGETABLES

IN MALDIVES

Table of content

S/N PARTICULARS PAGE

1 Location Map 2 Etymology 3 Geography 4 Profile

5 General Economic Overview of Maldives

6 Legal Aspects of Trade 7 Present Trade Relationship With India 8 Exotic Vegetables

9 SWOT Analysis

Part 1

Import – Export Opportunities with Reference to Maldives

 Location Map

 Etymology

The name Maldives may derive from Mahal'deeb, and the people were called Maldivian 'Dhivehin'. The word Dheeb/Deeb (archaic Dhivehi, related to Sanskrit dvīp ( )) means

"island", and Dhives (Dhivehin) means "islanders" (in other words, the Maldivians). During the colonial era, the Dutch referred to the country as Maldivische Eilanden in their documentation, while Maldive Islands is the anglicised version of the local name used by the British, which later came to be written as "Maldives".

The ancient Sri Lankan chronicle, The Mahawamsa, refers to an island called Mahiladiva ("Island of Women") in Pali, which is probably a mistranslation of the same Sanskrit word meaning "garland". The Mahawamsa is derived from an even older Sinhala work dating back to the 2nd century BC.

Some theorise that the name Maldives derives from the Sanskrit mālādvīpa, meaning "garland of islands‖. In Malayalam "Garland of Islands" can be translated into "Maladhweepu". In Tamil "Garland of Islands" can be translated into "MalaiTheevu". None of the names are mentioned in any literature, but classical Sanskrit texts dating back to the Vedic times mention the "Hundred Thousand Islands" (Lakshadweepa), a generic name which would include not only the Maldives, but also the Laccadives, Amindivi Islands, Minicoy and the Chagos island groups.

Some medieval travelers such as IbnBatuta called the islands "MahalDibiyat" ( ) from the Arabic word Mahal ("palace"), which must be what the Berber traveler interpreted of the local name having been through Muslim North India, where Perso-Arabic words were introduced into the local vocabulary . This is the name currently inscribed in the scroll of the Maldive state emblem. The classical Persian/Arabic name for Maldives is Dibajat.

 Geography

The Maldives consists of approximately 1,190 coral islands grouped in a double chain of 26 atolls, along the north-south direction, spread over roughly 90,000 square kilometres (35,000 sq. mi), making this one of the world's most dispersed countries. It lies between latitudes 1°S and 8°N, and longitudes 72° and 74°E. The atolls are composed of live coral reefs and sand bars, situated atop a submarine ridge 960 kilometres (600 mi) long that rises abruptly from the depths of the Indian Ocean and runs north to south. Only near the southern end of this natural coral barricade do two open passages permit safe ship navigation from one side of the Indian Ocean to the other through the territorial waters of Maldives. For administrative purposes the Maldivian government organized these atolls into twenty one administrative divisions. The largest island of Maldives is Gan, which belongs to Laamu Atoll or Hahdhummathi Maldives. In Addu Atoll the westernmost islands are connected by roads over the reef (collectively called Link Road) and the total length of the road is 14 km (9 mi).

The Maldives is the lowest country in the world, with a maximum natural ground level of only 2.3 metres (7 ft. 7 in), with the average being only 1.5 metres (4 ft. 11 in) above sea level, although in areas where construction exists, this has been increased to several metres. More than 80 per cent of the country's land, composed of coral islands are less than one metre above sea level.

The reef is composed of coral debris and living coral. This acts as a natural barrier against the sea, forming lagoons. Other islands, set at a distance and parallel to the reef, have their own protective fringe of reef. An opening in the surrounding coral barrier allows access to the calmer lagoon waters. The barrier reefs of the islands protect them from the storms and high waves of the Indian Ocean.

A 15 centimetres (6 in) thick layer of humus forms the top layer of soil. Below the humus layer are 60 centimetres (2 ft.) of sandstone, followed by sand and then fresh water. Due to high levels of salt in the soil near the beach, vegetation is limited there to a few plants such as shrubs, flowering plants, and small hedges. In the interior of the islands, more vegetation such as mangrove and banyan grow. Coconut palms, the national tree, are able to grow almost everywhere on the islands and are integral to the lifestyle of the population.

The limited vegetation and land wildlife is supplemented by the abundance of marine life. The waters around the Maldives are abundant in rare species of biological and commercial value. Tuna fisheries are one of the main commercial resources. The Maldives have an amazing diversity of sea life, with corals and over 2,000 species of fish, ranging from reef fish to reef sharks, moray eels, and a wide variety of rays: Manta rays, Stingray and Eagle ray. The Maldivian waters also host whale sharks and hawksbill and green turtles.

 PROFILE

 Geography

Area : 298 sq. km. (115 sq. mi.), over 1,100 islands; twice the size of Washington, DC.

Cities : Capital: Male (pop. 313,920).

Terrain : Flat atoll islands.

Climate : Hot and humid.

 Economy

GDP (2010) : $2.931 billion

GDP growth rate (2010) : 4.8%.

Per capita GDP (2010 EST.) : $9,005.

Inflation, year over year (2010 est.) : 4.7%.

Debt, external (2009 EST.) : $933 million.

Exchange rate (official peg) : 12.8 rufiyaa (MVR) = U.S. $1.

Unemployment rate (2006 EST.) : 14.4%.

Current account balance (2010 est.) : -$460 million.Percentages of GDP (2010 est.) : Tourism-29%; Transport and communications-20%; Government-18%; Manufacturing-7%; Fishing-3%; Construction-6%; Agriculture-2%; Other-10%.

Trade (2010 EST.) : Exports-$180 million: fish products.

Major markets : Thailand, Sri Lanka, U.K., France.

Major suppliers : Singapore, U.A.E., India, Malaysia, Sri Lanka, Thailand In ancient times the Maldives were renowned for cowry shells, coir rope, dried tuna fish (Maldive Fish), ambergris (Maavaharu) and coco de mer (Tavakkaashi). Local and foreign trading ships used to load these products in Sri Lanka and transport them to other harbors in the Indian Ocean.

Historically Maldives provided enormous quantities of cowry shells, an international currency of the early ages. From the 2nd century AD the islands were known as the 'Money Isles' by the Arabs.[50] Monetariamoneta were used for centuries as a currency in Africa, and huge amounts of Maldivian cowries were introduced into Africa by western nations during the period of slave trade.[51] The cowry is now the symbol of the Maldives Monetary Authority.

The Maldivian government began an economic reform program in 1989, initially by lifting import quotas and opening some exports to the private sector. Subsequently, it has liberalized regulations to allow more foreign investment. Real GDP growth averaged over 7.5% per year for more than a decade. Today, the Maldives' largest industry is tourism, accounting for 28% of GDP and more than 60% of the Maldives' foreign exchange receipts. Fishing is the second leading sector.[52]

The Maldivian economy is to a large degree based on tourism. In late December 2004, the major tsunami left more than 100 dead, 12,000 displaced, and property damage exceeding $400 million. As a result of the tsunami, the GDP contracted by about 3.6% in 2005. A rebound in tourism, post-tsunami reconstruction, and development of new resorts helped the economy recover quickly and showed an 18% increase on 2006. 2007 estimates show Maldivians enjoy the highest GDP per capita $4,600 (2007 est) among south Asian countries.

The Maldivian economy is based on tourism and fishing. Economic growth has been powered mainly by tourism, the backbone of the economy, and its spinoffs in the transportation, communication, and construction sector. More than 700,000 tourists visit annually. Fishing remains an important part of the economy as well. The Indian Ocean tsunami in December 2004 devastated many islands. The Maldivian economy made a remarkable recovery, with a rebound in tourism and post-tsunami reconstruction.

Of the Maldives' 1,191 islands, only 200 are inhabited. The population is scattered throughout the country, with the greatest concentration on the capital island, Male. Limitations on potable water and arable land constrain expansion. While income disparity remains high, particularly between the capital and distant islands, the Maldives' growth has yielded considerable social progress. The net enrolment in primary education is close to 100%. Literacy rates are about 97%. Infant and maternal mortality are declining rapidly.

GDP in 2010 totalled $1.48 billion, or about $4,770 per capita. From 2000-2010, real GDP growth averaged around 6% per year except for 2005, when GDP declined following the Indian Ocean tsunami, and 2009 when GDP shrank by 2% as tourist arrivals declined and capital flows plunged in the wake of the global financial crisis. The Maldives Monetary Authority (Central Bank) expects GDP growth around 4% in 2011. Inflation was at 4.7% in 2010.

The Maldives had a merchandise trade deficit of under $300 million until 2003. Since then the trade deficit has reached an unprecedented $780 million. In 2010, Maldives' economy was helped by a significant upturn in tourist arrivals. Consequently, the current account deficit was contained at around $460 million in 2010. The balance of payments recorded a surplus of about $50 million. Tourism is expected to continue to grow in 2011.

Fiscal control has deteriorated recently due to increased government spending, including large wage increases as well as falling revenues. The budget deficit was about 16% of GDP in 2010. Government expenditure was 51% of GDP and revenue was about 34% of GDP. According to government estimates, the deficit was forecast at 15% of GDP in 2010. Recent large budget deficits have led to a sharp build-up of public debt, prompting the World Bank and the International Monetary Fund (IMF) to classify Maldives as being at moderate risk of debt distress.

In December 2009, the IMF approved a $93 million loan for the country. After the first two disbursements, the IMF withheld subsequent disbursements due to concerns that the budget deficit must be further reduced. Maldives is facing a foreign exchange shortage. The current official exchange rate against the U.S. dollar is rufiyaa 12.8.

Under the IMF program, the government agreed to cut expenditure, substantially downsize the government workforce, reduce subsidies, change the tax system to direct taxes, and privatize many industries. The government also aims to move from being a service provider to a regulator, and to enhance the role of private sector. These programs require major reform in the legal and regulatory framework of the various sectors. However, most of these plans have not progressed smoothly. For instance, the government reduced civil servant salaries by an average of 14% in October 2009, but the Maldives Civil Service Commission (CSC) has filed a lawsuit to restore these salaries. Moreover, plans to retrench civil service staff have been put on hold for lack of funds. The government‘s privatization plans are also jeopardized by a recent law passed by the parliament which requires parliamentary approval to privatize state institutions. The government did privatize the international airport, and it sold government-held shares in a telecommunications company prior the passage of law. The government also signed a management contract with an Indian healthcare provider to manage a state-owned hospital with the aim of improving its management and services.

International shipping to and from the Maldives is mainly operated by the private sector with only a small fraction of the tonnage carried on vessels operated by the national carrier, Maldives Shipping Management Ltd.

Over the years, the Maldives has received economic assistance from multilateral development organizations, including the UN Development Program (UNDP), Asian Development Bank, and the World Bank. Individual donors--including Japan, India, Australia, and European and Arab countries (including Islamic Development Bank and the Kuwaiti Fund)--also have contributed. In a bid to promote exports, the U.S. Government restored the Generalized System of Preferences (GSP) trade program to the Maldives in December 2009. The United States is seeking to provide various other assistance efforts to defend against climate change, prevent drug use, and enhance U.S. investment. The Maldives became a member of the International Labour Organization in 2009.

Diversifying beyond tourism and fishing, reforming public finance, and increasing employment are the major challenges facing the government. Over the longer term Maldivian authorities worry about the impact of erosion and possible global warming on their low-lying country; 80% of the area is 1 meter (about 3.3 feet) or less above sea level.

 Economic Sectors

Tourism:

In recent years, Maldives has successfully marketed its natural assets for tourism--beautiful, unpolluted beaches on small coral islands, diving in blue waters abundant with tropical fish, and glorious sunsets. Tourism now brings in about $600 million a year. Tourism and related services contributed 29% of GDP in 2010. But its indirect contribution is much higher. As a result, tourism is the catalyst for growth. Since the first resort was established in 1972, more than 95 islands have been developed, with a total capacity of some 23,600 beds. Maldives has embarked on an ambitious tourism expansion plan; several resorts are under construction. However, resort expansion has not been planned very well. There is a glut of hotel rooms and several half-built resorts. Over 790,000 tourists (mainly from Europe) visited Maldives in 2010. The average occupancy rate is about 70%. Maldives had experienced capacity utilization rates of over 80%-- reaching over 95% in the peak winter tourist season--prior to the new resort drive that began in 2008. Average tourist stay is 8 days.

Fishing:

This sector employs about 11% of the labour force. The fisheries industry, including fish processing, traditionally contributes about 7% of GDP. Due to a drastic drop in the fish catch, the industry's contribution to GDP was only about 4% in 2008 and 3% in 2009. Fish export earnings were estimated at $80 million in 2009. The use of nets is illegal; all fishing is done by line. Production was about 100,000 metric tons in 2009, most of which was skipjack tuna. More than 40% is exported, largely to Sri Lanka, Japan, Hong Kong, Thailand, and the European Union. Fresh, chilled, frozen, dried, salted, and canned tuna exports account for about 90% of all marine product exports.

Agriculture:

Poor soil and scarce arable land have historically limited agriculture to a few subsistence crops, such as coconut, banana, breadfruit, papayas, mangoes, taro, betel, chillies, sweet potatoes, and onions. Almost all food, including staples, has to be imported. The December 2004 tsunami inundated several agricultural islands with salt water, contaminating the groundwater. Some of these islands still do not have clean groundwater. Agriculture provides about 2.0% of GDP.

Manufacturing:

The manufacturing sector provides less than 7% of GDP. Traditional industry consists of boat building and handicrafts, while modern industry is limited to a few tuna canneries, a bottling plant, and a few enterprises in the capital producing PVC pipe, soap, furniture, and food products. Five garment factories that had exported principally to the United States closed in 2005, following the expiration of the Multi-Fibre Arrangement (MFA) that had set quotas on developing country garment exports to developed countries. The loss of these factories has not proven an insurmountable hurdle, however, as most of the profits were repatriated and most of the labour was expatriate.

Other:

The construction sector contributes approximately 6% of GDP.

As we have seen all the facts & figures about Maldives, we‘ll now see the import and Export Opportunities for the country.

 Import

Fishes & Fish Products

As Maldives are islands, surrounded by the sea rich of fishes, the main export of the country is the export of fishes & the fish products. Various kinds of fishes are found here, which are not available or not easily available to other countries. There are many more usages of fishes other than as a food. Various types of medicines are made by them and for producing the perfume products, they are very useful.

 Export

Foodstuffs

As we have seen in above mentioned data, there is very less proper land available for the agriculture activity to be done.

In addition with the tourists needs a selective and proper food, there is a huge opportunity in importing the various foodstuffs.

Petroleum products

There is an increasing need of petroleum as the numbers of Boats, Two-Three wheelers are increasing YoY.

Petroleum is not available anywhere in Maldives, so it is another crucial product in the import.

Commodity

The usage of the various commodities like Gold, Silver, Platinum, Crude Oil, Wheat etc. is increasing by the civilians as well as the tourists that makes need of the commodity import a crucial thing.

Transport equipments One of the largest contributors in the economy of the country is the transportation.

More and more Boats and other water as well as land vehicles are selling in the country. And it is sure that these vehicles will need a huge amount of maintenance altogether. This will generate the potential consumption of transportation equipments.

Construction equipments

As the economy is increasing its numbers, the base of any economy, the Construction activity is increasing day by day in the country. Generally, all the material used for the construction activity is not produced in Maldives. So it is a mandatory thing to import them from the nearby or preferred countries. It shows a good opportunity for the countries to export these materials to Maldives.

 Maldives Import Prohibitions

Acids

Batteries, Haz

Bearer Documents

Bio Products, Haz

Chemicals, Haz

Corrosives

Cosmetics, Haz

Dangerous Goods as defined by IATA (Intl. Air Transport Association)

Flammables

Gases

Ice, Dry

Ice, Wet

Infectious Substance

Liquids, Haz

Liquor, Non-Haz

Magnetized Materials

Oxidizers

Paints, Haz

Perfume, Haz Poisons

Products containing alcohol

Radioactives

Toiletries, Haz

Religious materials offensive to Islam and idols (for worship).

 General Import Restrictions

The following items are not acceptable for carriage to any international destinations unless otherwise indicated. (Additional restrictions may apply depending on destination. Various regulatory clearances in addition to customs clearance may be required for certain commodities, thereby extending the transit time.)

Human corpses, human organs or body parts, human and animal embryos, or cremated or disinterred human remains.

Explosives (Class 1.4 explosives are acceptable for carriage to Canada, Germany, France, Japan, United Arab Emirates and United Kingdom. Note: United Arab Emirates only allows Class 1.4 explosives to be shipped hold-for-pickup to the FedEx Express facility in Dubai).

Firearms, weaponry and their parts (acceptable between the U.S. and Puerto Rico).

Perishable foodstuffs and foods and beverages requiring refrigeration or other environmental control.

Live animals including insects, except as provided in the Live Animals section in the FedEx Service Guide. (Call the FedEx Live Animal Desk at 1.800.405.9052).

Plants and plant material, including cut flowers (cut flowers are acceptable from the U.S. to selected points in Canada and from Colombia, Ecuador and the Netherlands to the U.S.). Lottery tickets and gambling devices where prohibited by law.

Money (coins, cash, currency, paper money and negotiable instruments equivalent to cash such as endorsed stocks, bonds and cash letters).

Pornographic and/or obscene material.

Shipments being processed under:

Duty drawbacks claim unless advance arrangements are made.

Temporary Import Bonds – acceptable under the FedEx International Broker Select option, for initial import only.

U.S. State Department licenses

Carnets

U.S. Drug Enforcement Administration export permit.

Letters of Credit. Shipments subject to Letters of Credit are generally prohibited, with the exception of shipments subject to Letters of Credit calling for a ―courier receipt‖, as defined by Article 25 of UCP 600, shipped using the FedEx Expanded Service International Air Waybill.

 Certificate of Registration shipments (CF4455).

You may be able to ship these items via FedEx International Controlled Export, FedEx International Premium, FedEx International Express Freight (IXF) or FedEx International Airpot-to-Airport (ATA). For information on FedEx International Controlled Export, call International Customer Service at 1.800.GoFedEx 1.800.463.3339 (say ―international services‘). For information on the other services listed call FedEx Express Freight Customer Service at 1.800.332.0807.

Hazardous waste, including, but not limited to, used hypodermic needles or syringes or other medical waste.

Shipments that may cause damage to, or delay of, equipment, personnel or other shipments.

Shipments that require us to obtain any special licenses or permit for transportation, importation or exportation.

Shipments or commodities whose carriage, importation or exportation is prohibited by any law, statute or regulation.

Shipments with a declared value for customs in excess of that permitted for a specific destination. (See the Declared Value for Carriage and Limits of Liability section in the FedEx Service Guide).

Dangerous goods except as permitted under the Dangerous Goods section of these terms and conditions.

Processed or unprocessed dead animals, including insects and pets. Taxidermy-finished hunting trophies or completely processed (dried) specimens of whole animals or parts of animals are acceptable for shipment into the U.S.

Packages that are wet, leaking or emit an odour of any kind.

Wildlife products that require U.S. Fish and Wildlife Service export clearance by FedEx prior to exportation from the U.S.

In-bond shipments destined to or being withdrawn from a Foreign Trade Zone or bonded warehouse, unless the FedEx International Broker Select option is selected for U.S. import shipments, or the FedEx International Controlled Export service option is selected for U.S. export shipments. Notwithstanding any other provision of the FedEx Service Guide, we are not liable for delay of, loss of damage to a shipment of any prohibited item. The shipper agrees to indemnity FedEx for any and all costs, fees and expenses FedEx incurs as a result of the shipper‘s violation of any local, state or federal laws or regulations or from tendering any prohibited item for shipment.

 General Export Restrictions

Human corpses, human organs or body parts, human and animal embryos, or cremated or disinterred human remains.

Firearms, weaponry and their parts (acceptable between the U.S. and Puerto Rico).

Perishable foodstuffs and foods and beverages requiring refrigeration or other environmental control.

Live animals including insects, except as provided in the Live Animals section in the FedEx Service Guide. (Call the FedEx Live Animal Desk at 1.800.405.9052).

Plants and plant material, including cut flowers (cut flowers are acceptable from the U.S. to selected points in Canada and from Colombia, Ecuador and the Netherlands to the U.S.).

Lottery tickets and gambling devices where prohibited by law.

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Part 2

Exotic vegetables

 GENERAL ECONOMIC OVERVIEW OF MALDIVES

The Maldivian economy is free economy & that‘s why it has a very free economy. The government gives lots of support to develop the relationship with the other countries & increase the trade relationship by making free economy with very less rules & regulations by adopting the policy of liberalization.

The Maldivian people believe that the business can be earned if more & more people are attracted towards the beautiful area of the Maldives & if they come to the Maldives as a tourist then they can earn a good income by giving them good hospitality services

Although there is limited production facility available in the Maldives, there is a lot of opportunity of making the business. The Maldives is a member country of WTO. This organization helps the Maldives to make business more effective.

The WTO helps the Maldivian people to make the business relationship more strong with the other developed & developing countries in terms of business.

If we see the structure of Maldives the agriculture sector provide 5.6%\, industry gives 16.9% while the service sector contributes 77.5% in the overall GDP.

If we compare the employment opportunity in the different sectors then also agriculture provide the 11% employment industry gives 23% & the service sector gives 65% of the employment opportunities.

So if we talk about the general service industry regarding the different trade & commerce relationship at that time it will contribute in the Maldivian economy a lot. The development of the trade relationship is the mostly depend upon this industry & it has a qualitative work approach by the government. Government will tries a lot to develop the trade relations & tries to convert it in to the opportunity for the Maldives.

 LEGAL ASPECTS OF TRADE & COMMERCE

For economic development & reduce the level of poverty there are so many trade policy have emerged in Maldives. Now a day‘s globalization & liberalization increases that‘s why international trade has also been emerged. There are some legal aspects of trade are as under

 Trade Regime(Import)

 Trade regime (Export)

 Multilateral Trading System

 Free Trade Agreements

 Preferential schemes

1. Trade Regime(Import)

This aspect is specially made for import. It means that if anyone want to import any goods or anything for business purpose from any other country than they want to take general import license which is issued by the ministry of economic Development & trade

2. Trade regime (Export)

Those who want to export goods from Maldives to other country for business purpose then they have to follow this legal aspect which specially made for export. In Maldives there apply some foreign investment royalty to export clothing. There is strick regulation made for fish export & if anyone want to export the fish then they have to take license for fish export

3. Multilateral Trading System

It is the founder of World trade Organization. Maldives country follows the international rules & regulation. The main areas that will affect the Maldives are

 Agriculture

 Trips( Trade Related Aspects of Intellectual Properties)

 Gats(General Agreement on Trade in service)  NAMA( Non Agricultural Market Access)

4. Free Trade Agreements

The main benefit of Free Trade Agreement is that they can import certain goods such as Pharmaceuticals. Through this trade they can freely negotiating trade agreement with India, China ,srilanka&Quatar

5. Prefential schemes

The main trade partner of Maldives is Europe & Japan. From this scheme mladivien gets the export the benefits so it is the good for Maldives because through which it helpful to export the goods & which ultimately lead to economy development as well as increases the employment opportunity.

 PRESENT TRADE RELATIONSHIP WITH INDIA

The relations between the India and Maldives have been closed in strategic, economic, and military cooperation. India contributed to maintaining security on the island nation and agreement with respect to its strategic interest in the Indian Ocean. India and Maldives have developed close strategic, military, economic and cultural relations. India has supported Maldives' policy of keeping regional issues and struggles away from itself, and the latter has seen friendship with India as a source of help as well as a counter-balance to Sri Lanka, which is in proximity to the island nation and its largest trading partner.

India and Maldives officially decided their boundary in 1976, although a minor diplomatic incident occurred in 1982 when the brother of the President of Maldives Maumoon Abdul Gayoom declared that the neighbouring. Minicoy Island that belonged to India was a part of Maldives; Maldives quickly and officially denied that it was laying claim to the island. India and Maldives signed a complete trade agreement in 1981. Both nations are founding members of the South Asian Association for Regional Cooperation (SAARC), the South Asian Economic Union and signatories to the South Asia Free Trade Agreement. Indian and Maldivian leaders have maintained high-level contacts and consultations on regional issues.

There is various relationships between India & Maldives & it will helpful to build good business relationship. The relationship with Maldives which are as under

 Bilateral relation

 Operation Relation

 Commercial Relation

 Military Relation

 Political Relation

 Political relations:

Bilateral relations have been nurtured and strengthened by regular contacts at the highest levels. Since establishment of diplomatic relations, almost all the Prime Ministers of India visited the Maldives.

On international issues Maldives had consistently supported India in multilateral foray, such as the UN, the Commonwealth, the NAM and the SAARC. Maldives was one of the first countries to convey its support for the candidature of ShriKamalesh Sharma as the Commonwealth Secretary General. Maldives also co-sponsored the G-4 draft resolutions on UN reforms. India has extended support to Maldives candidature for a non-permanent seat in the UN Security Council for the term 2019-20.

 Bilateral Assistance:

Wherever possible, India has been offering assistance to Maldives in its developmental process. The major projects executed by India are:

(i) Indira Gandhi Memorial Hospital: (IGMH)

(ii) Faculty of Engineering Technology (FET)

 Bilateral Trade:

India and Maldives signed a trade agreement in 1981, which provides for export of essential commodities. Bilateral trade is not commensurate with their potential. In 2009-10, the official figures for the bilateral trade stood at Rs.395.57 crores and heavily in favour of India. The Indian exports were worth Rs.378.49 crores and the imports little over Rs. 17 crores. However, the bilateral trade had declined substantially from the previous year due to the impact of global recession on the country‘s tourism industry.

 Bilateral trade figures:

Total Exports to Total Imports from Year Total Trade Maldives Maldives

2005-2006 299.19 8.76 307.95

2006-2007 310.96 13.83 324.79

2007-2008 360.55 16.69 377.24

2008-2009 590.28 17.93 608.21

2009-2010 378.49 17.07 395.57

Indian imports from the Maldives primarily comprise scrap metals while Indian exports to the Maldives include agriculture and poultry produce, sugar, fruits, vegetables, spices, rice, atta, textiles, drugs and medicines, a variety of engineering and industrial products, sand and aggregate, cement for building etc.

 Commercial relation:

India has developed bilateral agreement with the Maldives for the development of infrastructure, health, civil aviation, and telecommunication and labour resources of country. India has established Indira Gandhi Memorial Hospital in Male which is the capital of Maldives. During the 2006 India has exported about 384 crores and imported worth less than Rs. 6 crores in the Maldives. The state bank of India also had contributes 500 US $ for the economic expansion of Maldives

 Exotic Vegetables:  BROCCOLI

Overview:

Demand for broccoli has been increasing in past decade mostly due to the urban growth seen and the modernization of the cuisine and increased penetration of such exotic dishes especially in the metro cities across India. Broccoli has been marketed as a nutritious dietary supplement due to its high fibre content, vitamin C, A and mineral content, including calcium and iron, and cancer- preventing agents, which have spurred consumption among increasingly health-conscious consumers.

Demand:

Demand for broccoli has been increasing in past decade mostly due to the urban growth seen and the modernization of the cuisine and increased penetration of such exotic dishes especially in the metro cities across India. Broccoli has been marketed as a nutritious dietary supplement due to its high fiber content, vitamin C, vitamin A and mineral content, including calcium and iron, and cancer-preventing agents, which have spurred consumption among increasingly health-conscious consumers.

Area Harvested:

Area harvested for broccoli and cauliflower in India remains nearly constant throughout the decade at 250000-280000 hectares. Since, the cultivation of broccoli done in the same region involving a few areas of Himachal Pradesh and other greenhouse cultivators across India in all the seasons.

Partially due to the requirements of the cold climatic conditions that is required for the cultivation of this brassica.

Broccoli is an annual cool-season crop hardy to frosts and light freezing, often. Broccoli is sensitive to the heat, if the weather is too hot, it will flower quickly and won't produce an edible head, and it tends to grow best in the fall (August to November) due to the more predictable cool weather.

Opportunity:

Here in the Maldives, the hotel business has been growing at a fast speed.

As Broccoli is one of the most appreciated vegetable in the world, more and more people are demanding the items made of Broccoli.

And as adequate land is not available here, they can.t harvest Broccoli in their country.

It shows a very good opportunity for India to export Broccoli to Maldives.

 ASPARAGUS

Overview:

Botanically termed as 'asparagus officials', asparagus is a flowering plant of the lily family. A native to Europe, Northern Africa and Western Asia, it is now widely grown in both hemispheres and throughout temperate and tropical regions. The exact origin of this vegetable is not known because many wild types can be found throughout Europe and Asia. However, the most likely location is around the Mediterranean Sea where cultivation has been practiced for over 2000 years, first by the Greeks and then by the Romans (around 200 B.C.

Status in World trade:

Among the various exotic vegetables grown asparagus has the largest share in both domestic and international trade. The annual compounded growth rate in the world market is as high as 20 per cent. It is rich in fibre and vitamins. Asparagus is a hardy bush, its cultivation practices are relatively simple, it grows well on soils of average fertility. Asparagus is environment friendly, with very low demand on pesticides and chemical fertilisers. To give a comparison asparagus requires only five per cent of pesticides and fertilizers compared to grapes. Agro-climatic conditions in India are suitable to the crop; in most parts of the country two harvests per year are possible.

India Export:

India has just begun the export of asparagus. Compared to other countries of the World, export value of India for asparagus is still very less due to the nascent stage. Export quantity and value for the vegetable showed its peak in 2005 at 176 Tons and $84000 respectively. However, in the recent years, the cultivation and hence export is likely to show a sharp growth due to serious actions taken by the farmers from various regions like NAFA in Nasik.

 LEEK

An Introduction:

Leeks refer to a sweet and moderately flavoured vegetable which is closely associated with onions and garlic. Scientifically termed as Alliums ampeloprasum var. porrum (L.), they are a part of the alliaceous family. Renowned for its delicate and sweeter flavour, leek adds a subtle touch to recipes without overpowering the other flavours that are present. Reports shoe that leeks are preferred in the market segments that refrain from onion consumption.

This sweet and mild flavoured vegetable is an inseparable element of many renowned dishes. Leeks are most commonly used in soups, most notably in vichyssoise, a lovely soup composed of potatoes and leeks and served cold --excellent for summer day lunching.

Brief History:

For centuries, the leek has been widely used in preparing many delicious recipes all around the globe. A native to the Mediterranean countries, leeks are widely cultivated in temperate regions of the World. This root vegetable has been known as a food for over 4000 years in the Middle East. Researchers have discovered traces of leeks near Egyptian pyramids. In the traditional medicinal system, leeks were used for curing many diseases. Hippocrates, the father of medicine, prescribed the leek as a cure for nosebleeds. It was closely associated with Wales. Even today the leek is worn as the national flower of Wales on St. David's day.

Producer prices for leek is very high in the country like Congo but remains nearly same in the other countries like France, japan Finland and Ireland at 2000$/Ton.

Japan imports the largest quantity of leek in the World. Which is followed by European countries like UK, France Spain and Germany? Import prices for leek are highest in UK reaching at 1600¬1800$/Ton. While in other top importing nations, the import prices are around 800- 1000$/Ton. Import of leek in India is negligible in comparison to other countries.

Indian market:

Price of leeks fluctuates between 45 and 70 Rs/Kg in retail market. For annual contract, it can be accessed at 50-55 Rs/Kg. Prices in winter are 45-50Rs/Kg and in summer it costs 75Rs/Kg. farm level prices in the markets like Shimla are between 40-50 Rs/Kg. Its consumption in the markets like Mumbai is around 700Kg/day.

 LETTUCE

An introduction:

Lettuce is one of the most important salad crops. It is a native of Europe and Asia and introduced in India by the Britishers. Lettuce is an annual crop and belongs to family composite. The leaves and heads are used as salad. There are about 150 varieties, of which only about 20 grown on a considerable scale. Types:

There are four distinct types of lettuce.

1. Head type variety Capitata,

2. Leaf type variety Crispa,

3. COS type variety Long folia,

4. Asparagus type variety Asparagus.

The head lettuce is divided into two classes – crisp head and butter head. Both Butter head and crisp types have cabbage – heading varieties and Bunching varieties while the COS type have Spatulate – leaved varieties; Lanccolate – leaved varieties and Lobed – leaved varieties. I.C.A.R recommended Great Lakes (crisp head), Chinese yellow and Slow Bolt (leaf type). Lettuce requires cool growing season. The temperature between 550 to 600F is best. Very high temperature accelerates bolting. It requires 70 to 120 days to harvest.

Note: Chicory leaf is similar to lettuce and is listed together with lettuce in agricultural data because of its resemblance to lettuce in prices and other botanical characteristics.

World trade:

The World leader in the lettuce production is China which accounts for nearly 50% of total production in the World. However, most of the lettuce that is produced in China is being consumed in the domestic market itself. Hence, China is far behind the Spain and US in exports.

Producer prices in India are very high in comparison to other exporting nations. Producer prices in India remains within 1000-1400 $/Ton while in other countries, it is as low as 200-400 $/Ton. The area of land dedicated for the production of lettuce and chicory (similar to lettuce used in salad) is very large in China followed by India. In spite of having dedicated large area for the production of lettuce and chicory in India(second only to China), India is far behind in the production and yield of lettuce.

Indian scenario:

India is the third largest lettuce and chicory producer in World accompanying Spain and Italy and far behind the leaders like China and the US.

Area harvested for lettuce and chicory in India remains constant at 120000 Ha. Its yield and production also remains stagnant at 790000 over years. India does not import lettuce. Its export quantity is increasing at a steady rate reaching maximum of 1039 Tons in 2003 and then stabilizing at progressing 900 Tons in 2007. Producer‘s prices is constantly increasing at nearly 5-10% per annum reaching 240$/Ton.

 CORIANDER

An Introduction:

Coriander, also known as the Chinese parsley, Cilantro, Dizzy corn and Japanese Parsley, is an annual herb in the family Apiaceous. It is among the first spices used by mankind, having been known as early as 5000 BC. Its description is also mentioned in Sanskrit writings dating from about 1500 BC. Coriander is referred to in the Bible, in the books of Exodus and Numbers, where the colour of „manna‟ is compared to it. Romans introduced it to Britain and coriander was widely used in cookery and medicine until the Renaissance, when an array of new aromatic spices replaced it. Historical findings suggest that ancient physicians like Hippocratic and Pliny were familiar to it.

In culinary context coriander refers to either the seeds of the plant (used as a spice), or to its leaves (used as a herb). Though, all parts of coriander plant are edible, but its dried seeds and fresh leaves are widely used in cooking. Its leaves are known by the name of Cilantro in North American countries. Coriander seeds are primary ingredients of the garam masala, a blend of ground spices common in the Indian, Bangladeshi and Pakistani cuisine. The word 'coriander' originates from French coriander through Latin corundum in turn from Greek.

Coriander Leaves:

The leaves are always bought fresh as dried coriander loses its fragrance. The base leaves are broad, similar to Italian parsley, and are reputed for the better flavour.

Its flavour is strong, yet delicate and complex, with notes of lemon and ginger. Coriander leaves are widely used in making chutneys, pastes and raitas when combined with other herbs and spices such as green chillies and mint.

Indian market:

Coriander leaves are widely used in the Indian dishes as a flavouring agent and as a garnish. Most of the green coriander that is produced in India is consumed in the domestic market itself leaving no room for its export.

Leading producer states in India for coriander green are Gujarat, Rajasthan, AP, MP and Tamil Nadu. In the states like Gujarat, Rajasthan and AP it is available throughout the year while in other states, its available in winter season only. Prices for coriander green vary from season to season reaching 2000Rs/quintal and sliding to 1600Rs/quintal in different markets across India.

 RADISH

Botanically termed as Raphanussativus, the radish is a herbaceous plant grown for their crisp and peppery-tasting roots. This plant of the mustard family with a pungent root was domesticated in Europe in pre-Roman times. Some of the roots are long and tapering, others are globular; the latter are commonly known as turnip radishes. A native to China, this vegetable is grown and consumed in every corner of the globe.

Varieties:

Radishes are available in various varieties, with white, red, or black roots of different shapes and sizes. Being a fast growing plant, they can be ready for harvest in less than a month. The best quality roots are produced in spring or fall when temperatures are in the range of 50 to 65°F, with ample moisture. Certain species of radishes are grown for their seeds; oilseed radishes are grown, as the name implies, for oil production. In China, they are generally pickled in brine; whereas Cost component % stake in production radishes are Labor 73 considered as Seed 18 a staple food in Japan. Pesticide 6

Fertilizer 3

Indian market:

Area under Cultivation:

The main radish growing states are Rajasthan, Gujarat, Delhi, West Bengal, Bihar, Uttar Pradesh, Karnataka, Punjab and Maharashtra.

Production cost:

Labour (73%) is the highest cost component in radish cultivation, follows with seed (18%), pesticide (6%) and fertilizer (3%) (Department of Census and Statistics, 1996). The estimated production cost indicates that increasing the productivity of the crop by adopting appropriate technologies could reduce the unit cost of production.

Quality improvement for Export:

Uniform shape, length (> 15 cm) and width (6-8 cm) with white skin colour are the requirements for export market. In addition, the skin should be free of blemishes, physical injuries and pest and disease damages. Usage of proper varieties, adoption of appropriate management practices and pre and post-harvest handling improve the quality of produce for export market.

 PARSLEY

Botanical description:

Parsley is the dried aromatic leaf of a biennial herb with dense foliage and white flowers. The bright green leaves are finally divided and curled. There are two main types of horticultural parsleys. The one cultivated for leaves, which is found in India and the other grows for its turnip like roots. The flowering stalk reaches up to a height of 100 cm in the second year. Flowers are yellow or yellowish green in compound umbels. Fruits 2-3 mm long, crescent shape, conspicuously rigid and consisting of two mericarps. Leaves and seeds are used as spice. The aroma of the herb is characteristic, fragrant and spicy due to volatile oil present.

Varieties:

There are two main types of horticultural parsleys: those cultivated for the leaves (var.Crispum) and those grown for their turnip-like roots (var. RadicosumDanert). Only the former type of parsley is cultivated in India. In the latter case, roots are cut after the fruits are harvested. The roots are sliced longitudinally to facilitate drying. The seeds are used for the extraction of parsley oil of commerce. Of course, the aroma of the seeds is less than that of leaves. Two to five cuttings of leaves are possible for each planting before flowering. Within the leafy varieties, parsley has been developed into three types of foliage, viz. plain foliage, the double curled leaf, and the moss curled or triple curled leaf. The fleshy rooted parsley has plain celery like leaves.

Parsley cultivation:

Parsley is a cool weather crop, growing best in a rich moist soil, amenable to deep cultivation. In this country, the herb grows better at higher altitude. It is grown occasionally in gardens. Sowing is done in March-May on the hills and August to November in the plains.

Serrated or toothed edges and wrinkled surfaces. Italian, or plain-leafed, parsley (P. c. var. filicinurn) is more favoured by many cooks because it has more flavour than French parsley, but the latter reigns supreme as a garnish for many different foods. The 15-30cm plants are biennial flowering in their second year but most gardeners treat them as annuals, starting anew from seeds each year. Parsley should be grown in sun-filtered shade or morning sun and afternoon shade, and in partially moist soil that is moderately rich. Soak the seeds in warm water for 24 hours before planting as they usually take several weeks to sprout. Parsley is used fresh as a garnish, and fresh or dried in many different foods such as vegetables, meats, stews, casseroles, salads, soups, and eggs. Harvest the leaves before plants flower: Once the flower spikes form, the leaves become bitter tasting.

Origin and Distribution:

Parsley is a native of Sardinia and is widely cultivated in the Mediterranean region and the USA. It also grows in Mexico, Dominican Republic, Canada, West Germany, Haiti, France, Hungary, Belgium, Italy, Spain and Yugoslavia. Parsley is a cold weather crop, growing best in rich, moist soil. In India it grows better at higher altitudes.

Market in Indian cities:

In cities like Ahmedabad, process during winter (Oct. to Apr) are 75-100 Rs/Kg, while in summer prices soar to 250 Rs/Kg. on annual contract basis, parsley can be made available at 150 Rs/Kg throughout the year. In Mumbai, retailer prices are 110 Rs/Kg and demand is in range of 9-10 Tons per month

 MUSTARD LEAVES

Mustard leaves are the green vegetative part which is not sold for its seed. As seed is not the primary part of sale the crop can be grown in rows very close to each other. This hampers the growth of the seed but has a minimal effect on the leaf growth. It is a 15 to 20 day crop that is taken by farmers needing instant cash flow and is seldom traded in Maldives. Farmers tend to take some dry land crop after the initial mustard leave crop. Mustard leaves are available during winters only and they are sold for the price of around 35Rs per Kg. In Ahmedabad, there is hardly any demand for mustard leaves and there are no exotic vegetable vendor who deals with the supply of same. Mustard leaves are sold in cities like Mumbai to the extent of 800 Kg per day.

 SWOT ANALAYSIS FOR THE MALDIVES

 Strengths

1. They have optimum resources to gain the competitive advantages over the other country

2. Strong private sector tourism industry.

3. Fast growing economy: 7% GDP growth during the last decade, 18.2% in 2006 based on the strong recovery in the tourism industry.

4. Relatively high GNP per capita ($2,400) and low poverty incidence (only 3% of the population below $1/day).

5. Generally stable political environment with the ongoing reform agenda.

6. Government pushes on local governance and decentralization.

7. Reasonably good primary and secondary education and English language skills.

 Weaknesses

1. They are lagging behind the agriculture industry.

2. They are depend on other country for food products, so that they lose the earning opportunities

3. A narrow economy base: tourism accounting for a third of the GDP, followed by transport/communications (15%), manufacturing (8%), and fisheries (6%).

4. Income inequalities and poor access to basic social service for many scattered coral atolls. 5. Lack of adequate human resources in the country hampering sustained economic growth and development. 6. Institutional deficit: weak institutions managing the development process and large expansion of civil service and subsidized social services.

7. Low absorptive capacity for external assistance and currently too many externally funded projects.

8. Lack of social and physical infrastructure supporting scattered atolls and tourism.

9. Governance deficit: primarily on account of absence of independent institutions and statutory bodies and lack of transparency in the decision making process.

10. Large inequalities and inequities between the capital Malé and outer atolls.

11. Very high youth unemployment rate and heavy reliance on expatriate labor.

 Opportunities

1. Increased foreign investment in core sectors and promotion of private investment by locals (especially at atolls).

2. Diversification of industry through developing local industries.

3. Strengthening of institutional capacity in public sector.

4. Strengthening of governance and economic management.

5. Development of a merit-based civil service structure and efficient human resource Management.

 Threats

1. Rising sea level, tsunamis, and mismanagement of environment and pollution.

2. Social and political tension from large social and economic inequities between Male and outer atolls.

3. Potential fiscal and economic instability: unless the Government addresses the rapidly growing fiscal deficits before its debt reaches unsustainable levels, high economic growth would be difficult.

4. Increase in political tensions in the short-term due to the transition to multi-party democracy.

 Sources of information

1. file:///F:/GCR/Maldives%20Customs%20Service%28Imports%20&%20Exports%20Yea rly%20Increase%20%281999%20-%202010%29%29.htm 2. file:///F:/GCR/Maldives%20Customs%20Service%28EXPORTS%20BY%20COMMOD ITY%202006%20-%202008%29.htm 3. file:///F:/GCR/Maldives%20Customs%20Service.htm 4. file:///F:/GCR/Maldives%20Customs%20Service%28export%20by%20country%20desti nation%202007-2010%29.htm

“FAMILY BUSINESS AND SOCIAL ISSUES IN MALDIVES”

“MALDIVES’ IMPORTS OF AGRICULTURAL PRODUCTS

FROM INDIA”

INDEX

Sr .no Content 1 Introduction of maldives 2 Family-owned businesses 3 Maldives family businesses 4 Tourism industry 5 Social issues in tourism industry 6 Fishing industry 7 issues in fishing industry 8 Handicraft industry 9 Issues facing by handicraft industry in maldives 10 Agriculture and cottage industry 11 Issues in cottage industry 12 Other social issues 13 Agriculture sector maldives 14 Agriculture sector‘s importance to the maldivian economy 15 Comparative position of agriculture sector in india 16 Import export of maldives 17 Rice-staple food of maldives 18 Rice-staple food of maldives 19 Norms and policies of india for export including taxation 20 Growth potential for india 21 Barriers of agriculture sector 22 Suggetions for promiting exports 23 Conclusion 24 References

INTRODUCTION OF MALDIVES

 Capital: Male

 Official language : Dhivehi, English

 Ethical groups : 100% Dhivehi‘s (excluding foreigners)

 Demonym : Maldivian

 Government: Presidential republic

 President : Mohamed Nasheed

 Vice president : DR. Mohamed Waheed Hassan

 Speaker of the Majlis : Abdula Shahid

 Chief justice : Ahmed Faiz

 Independence : From united kingdom 26 july 1965

 Anthem : Qaumii salaam

Flag emblem

FAMILY-OWNED BUSINESSES

A family owned business is defined as business in which two or more family member together and start a business and majority of ownership and control powers. Family owned business may be the oldest from of business organization and today they are familiar as important and different participants in the world economy.

Family owned business may have some benefits over other business because of here focus on the long term their commitment to quality (which is associated with the family name) and their care and concern of employees. Family business also face different type of management challenges like separation of family and different family business issues.

FAMILY-OWNED BUSINESSES IN MALDIVES

 Tourism  Fishing  Handicraft  Agriculture and cottage industry

ISSUES IN FAMILY BUSINESSES

 A family can be defined as relation between two separate but connected systems. The business and the family with uncertain business and different rules & regulation the way in which peoples communicate with in a family.

 For example may be unsuitable in business situation , similarly personal concerns or rivalry may carried out into the work place to the damage the firm.To become successful in family business. Here must be open communication, use of different strategic planning tools and when here is need get the advice and assistance of experts.

 Bowman- ―Upton listed a number of common issues that most family businesses face. Attracting and retaining nonfamily employees can be problematic, for example, because such employees may find it difficult to deal with family conflicts on the job, limited opportunities for advancement, and the special treatment sometimes accorded family members.‖

 Many family businesses also have trouble determining guidelines and qualifications for family members hoping to participate in the business. Some companies try to limit the participation of people with certain relationships to the family, such as in-laws, in order to minimize the potential for conflicts.

 Family businesses often face pressure to hire relatives or close friends who may lack the talent or skill to make a useful contribution to the business. Once hired, such people can be difficult to fire, even if they cost the company money or reduce the motivation of other employees by exhibiting a poor attitude.

 Another challenge frequently encountered by family businesses involves paying salaries to and dividing the profits among the family members who participate in the firm. In order to grow, a small business must be able to use a relatively large percentage of profits for expansion.

 Another important issue relating to family businesses is succession—determining who will take over leadership and/or ownership of the company when the current generation retires or dies.

 In family business there various troubles regarding determining guidelines and qualification for family member, the want to participate in the family business. Some firms by to limit the participation of people with certain relationships to the family such as in laws, in order to minimize the conflicts problems.

 Family business often faces various kinds of pressures to higher close friends and relatives who have insufficient skill and talent to make a useful contribution to the business. Once these people are hired it will be difficult to hire them even if they cost the company money or reduce the motivation of other employees by shaving a poor attitude.

 Another difficulty a family business faces paying salaries and dividing profit among the family member to participate in the firm. In order to grow a small business has to reinvest a relatively large portion of profit for that expansion.

 Another important issue and the family business is the succession, deciding. Who will take over leadership or ownership the company when the current when retires or dies.

MALDIVES FAMILY BUSINESSES

TOURISM INDUSTRY

 Maldives tourism industry entered in the international platform only after 1970s. Tourism started with the opening of two resorts in 1972, and about 1000 tourists visited the Maldives was not popular in the tourist travel trade by the late 1970 our operators notably from West Germany and Italy started to features the island within their program and international tourism at became important source of income Maldives.

 Tourism accents for 28 % of the GDP and more than 60 % of the foreign exchange receipts in the Maldives and economy over 90% govt. tax revenue comes from import duties and tourism related taxes. Import duties and tourism related taxes. The development Maldives and tourism sector has fostered the overall growth of the economy. Tourism creates various employment and income generation opportunities in others related industry also the first tourist resorts were opened in bands island resort and kurumba village in 1972.

 According to the ministry of tourism the emergence of tourism in 1972 change the economy moving rapidly from dependence on fisheries to tourism industry. Industry became the main source of income .tourism was also the single largest contributor to the GDP and countries biggest foreign currency earner sector. In the year 2008, 89 resource in the Maldives offered over 17000 beds & hosted more than 6 lack tourist annually. From 1972 to the year 2007 the no. of resorts increase from 2to 92 & over 8380000 tourist had visited Maldives.

SOCIAL ISSUES IN TOURISM INDUSTRY

 Tourism industry is dominated by private enterprises for purpose of making profit by selling.

 Experience. Planning lead by market & fail to achieve the objective of sustainable tourism & has a tendency to forget cultural social & environmental impacts.

 In the tourism industry child labor is wide spread. It is because of law pay & lack of control. In the tourism industry the extend of held labor cannot be easily identified because of its hidden nature. Occupation for in the tourism sector there are different kinds o occupation in the hotel. Children‘s work as bell-boys maids, hospitality workers or golf caddies. Kitchen helpers or dish washer. Other work as dancer, beach boys & girls , guides or hawkers. Many of these occupation are very dangerous to the children‘s.

 The tourism and holders sector are very dependent on policies perception of global health and security risks. Security scares can decrease demand for hotel and tourism services. The sector also plays a preventive role. When many crisis that have damaged demand for travel and tourism in recent year like terrorism, spread of epidemics such as serve acute respiratory and natural disasters. Such as earth –quakes or tsunamis, hotel and tourism companies must be involved not only crisis preventation but have measures in place to adequately respond to crises. Companies can thereby play a role in reassuring the public as to the rarely of travel and tourism.

 Tourism also has affected families individuals and socially the majority of workers in the tourism sectors are male most of the workers feel cut-off due to separation from family and friends and this situation is not limited to tourism industry many of workers heaving in male are for from their home Islands.

 Many local employees believes that there is biasness against local staff in their resorts there are also many examples of violation of workers, labor rights, enshrined in the ILO core conventions. The management also fails to hold effective conversation with workers and their headers.ad occasionally to refuse to acknowledge unions or engage in anti unique discrimination.

 There are no processes for monitoring staff having or accommodation given to employs by their employs .the assessment team found that houses provided to workers by the employers is insufficient and often not suitable for human habitation except for very few govt. owned for very few govt. owned corporations and some private companies. the team also found that such a accommodation facility over crowded missing in proper ventilation and without adequate sanitary facilities and in most phase water or with limit amount of fresh water.

 There are many obstacles like seasonal and part time nature of many jobs law wages, poor overtime rates and irregulatory working are can limit to the career development and also demotivate the employees therefore hotel & tourism sector faces various difficult ties in recruiting the refrain employs.

 The participation of woman is limited in Maldives however they like to start small business but they often back access to finance. Also, there is still relocation particularly from their parents and families also don‘t like to live in the resorts and reform home in the late evening.

 Women are powerless to speak English also has limit communication with the tourists. In male some women work in restaurants but they are more established in government position more than few countries face this problems. Now that there are several chains with multiple outlets, careers planning should be more reasonable.

 Some hotel and tourism companies function different countries where corruption common and human rights violations linked to the sector are common , such as sex tourism , child prostitution and kidnapping some multinational companies are doubtful to direct and deliberately promote any of these activities unawareness and lessen them to contribute to the population of such social problems.

 In addition to migration from atolls an increase and alcohol to be an emerging social problem.  The tourism industry is decent ration that is there is a little dependence on urban centers and imports to maintain tourism activity. Some communication are based on tourism relies on small locally operated business and products and thrives on entrepreneurial activity from individuals.

 Direct local contribution in the tourism is diminished due to the power of the foreign nationals employees sectors. However this could toward the anger toward the foreign employees growth in the employees‘ opportunities in resorts has resulted in out migration from outer atolls to male atoll and it has put, pressure on the resources of the capital. In some countries, the social carrying capacity has not been exceeded; however, the outmigration raises sustainability issues.

 Negative perception and attitudes towards visitors and tourism can also affect tourism can also affect tourism/communities. To some people the tag tourist has become a negative term. There is a clear shift in the attitude of both communities and travelers to the concept of ―visitor‖. The guest concept reinforce the fact that travelers are visitors within a community and that their stay is a advantage and not a right.

 Tourism is service and experience based industry. Tourists often have their own set images about destinations before they arrive in the countries. Many impacts are socio-cultural and their outcome will be in lack of information, false impression, misinformation, poor communication and poor knowledge.

 In addition, no discussion on resort development has taken place with the closest islanders and the issues of reef ease of use and harvesting being lost without compensation have not been addressed.

 Most of the shopkeepers complain that they have difficulty in marketing their produce to tourists. Standards of living transform have included the stress of working in tourism itself, a nontraditional employment sector.

 Since Maldivian tourism is organized on a ―separate resort island‖ basis, adverse social impact on lifestyle seems less. The Maldives employs are in large proportion of foreigners; about 50 percent of the workers in resorts are from South Asia. This practice is Maldives needs to generate job opportunities for its young.

 Companies can tackle these issues by adopting and maintain the codes of labor standards and ensuring that opportunities for careers progression and training are not narrow to international managerial staff but are also available to home employees. This benefits both the sector and the community by increasing a more diversified pool of skills.

ENVIRONMENTAL IMPACTS OF TOURISM

The first proper estimation of tourism in the Maldives was established in 1983. It was discovers that the pollution of the sea with garbage, piles of waste found in the resorts often close to the tourist cottages, the picking of corals the use of spear guns were features present that did not fit into the tourist. In 1991, after almost two decades of tourism development in the Maldives, the opinion of impacts has changed. According to the present perceptions, the islands offer uncommon image beauty unspoiled by human settlement, virtually incomparable marine environment and the strongest of all unspoiled, under populated tiny hot islands with natural beauty and abundant sea life.

 Solid waste Solid waste disposed is one of the most obvious impacts of tourist resort operation and one of the easiest environmental management problems to deal and thus has been addressed in a number of reports on tourism development in the Maldives. The pollution of the sea with garbage and heaps of waste found in the resorts often close to enjoyable. In 1985 the development of tourism reported that the disposal of non- biodegradable waste was them a grim problem and that there was need for learning to increase environmental awareness, and for the use of recycling technology.

 Sewage disposal In 1980 only two resorts were reported as discharging saltwater glowing toilets to the open sea. Sewage disposal reported from 34 reports disposed sewage into the ground while 11 discharged sewage to the sea. Sewage disposal has health implicates and environmental consequences. Aquifer pollution by faucal coli form bacteria or the contamination of bathing waters could give rise to health problems. Since a very small percentage of resorts pump sewage into the sea and even so, these resorts have a very small population it might be concluded that the current levels of sewage creation into the resorts do not fake very serious problems to human health  Island vegetation The picture of the palm fringed sandy beach and abundant tropical vegetation is integral to the perception and approval, with Maldives as a tourist designation. At Present there is no requirement for the survey and believe the vegetation of an island as the part of planning support process previous to resort development .in construction process trees and shrubs are cut down and coastal vegetation is detached. Foreign attractive and fast growing species are imported to replace the vegetation and for new resort gardens. The introduction of the exotic species not only reduces the ability of the island to recover its natural state but also the exotic species may defeat local ones straight or through the introduction puff pests.  Groundwater There is an increasing move away from using ground water as a resource in tourist resorts. Drinking water in tourist resort comes from rain water. The rain water is collected on roofs and kept in large tanks and is now supplemented by desalinated water and imported mineral water bottled. There has also been a move away from the system in which groundwater was used for showering and flushing with the waste water pumped out to sea and desalinated water used for showering. Ground water quality decline could caused through increasing abstraction of groundwater which depletes the already thin freshwater lends, salt water intrusion into the freshwater aquifer and pollution of groundwater from sewage discharges.  Coral reefs On tourist resort island reef damage has been caused by scuba drivers, and by snorkelers and bathers walking out across the reef flat. The greatest threat at present almost certainly arises from snorkelers and bathers. From both accidental breakage and purposeful removal of coral and coral fauna for souvenir. Direct and indirect damages to reefs is also caused by divers and tourists. However, the greatest impact to reefs in the Maldives has originated from coral mining for construction purposes.

FISHING INDUSTRY

For many centuries the Maldivian family was entirely dependent on fishing and other marine products. Fishing remains the main occupation of the people and the government gives priority to the fisheries sector.

The mechanization of the traditional fishing boat called dhobi in 1974 was a major milestone in the development of the fisheries industry. A fish canning plant was installed on Felivaru in 1977, as a joint venture with a Japanese firm. In 1979, a Fisheries Advisory Board was set up with the mandate of advising the government on policy guidelines for the overall development of the fisheries sector. Manpower development programs began in the early 1980s, and fisheries education was incorporated into the school program. Fish aggregating devices and directional helps were located at various strategic points. Moreover, the opening up of the Exclusive Economic Zone (EEZ) of the Maldives for fisheries has further increase the growth of the fisheries sector.

In 2010, fisheries contributed over 15% of the country's GDP and involved about 30% of the country's work force. Fisheries were also the second-largest foreign exchange earner after tourism.

SOCIAL ISSUES IN FISHING INDUSTRY

 Fishing is not seen as an attractive career opportunity by the young generation, as the profession is not associated with educational and social esteem. Current conditions on board are basic. These factors outweigh the income generating aspect, which for fishing exceeds a standard government salary check.  Fishing as a traditional business is mostly practiced from wooden hulled bowl with basic facilities for the company. As most fishing is with limit and line carried out on a visit basis, conditions on board are not suitable for women and the limit and technology that is applied requires power.  But, there was a large decline in women employment in the sector of around 64 per cent between 1990 and 2000. The main reason is the general decline of the traditional cottage style processing of ‗Maldives Fish‘. In the few processing factories that are in operation, women carry out tasks such as filleting, trimming, packing, in addition to quality control procedures, documentation, and administration.  There are also differences in sector employment patterns between the atolls. While more than one in three workers in Ghaafu Alifu is employed in fishing, less than one in twelve workers in Haa Dhaalu, Shaviyani, Noonu and Gnaviyani are employed in fishing.The DTIS team established that 672 foreign workers worked in the sector in 2003 – anumber that has been gradually increasing over the years. These jobs are mostly in management and processing activities requiring skills.  Training facilities are limited in number, scope and quality. The main facility is the Centre for Maritime Studies (CMS), which offers training in navigation and associated functions. MFAMR offers a short course in fish filleting and packaging that is targeted at women. The Faculty of Engineering and Technology offers training in general mechanical engineering but this is mostly geared towards careers in the merchant fleet and inter-island tourist transport.  However, there are no courses to provide training for fishing captains, master fishermen, mechanical engineers in a modern fishing fleet, on-board post harvest handling of the catch, and quality assurance systems such as the Hazard Analysis Critical Control Points(HACCP), or ISO 9001 and 14001 series quality assurance standard documentation systems. This partially explains why employment as a fisherman is considered to be work for the uneducated, associated with low social status and offering very little attraction for the young.  Fisheries policy and regulation is the responsibility of Ministry of Fisheries, Agriculture and Marine Resources (MFAMR) while the Marine Research Centre (MRC) is responsible for scientific research and analysis. Some of the staff in both agencies is highly qualified. For example, the MRC has a staff of 26, eight of whom hold academic degrees. But the overall capacity to carry out policy analysis and implement development plans is considered not sufficient.  Current regulatory practices including application of fees and parts are not fully transparent. The fact that statistical data on sector operations are not collected systematically also contributes to the lack of transparency. Fees are applied for reef or near shore and high sea fishing. The near shore license fee is a mere Rf 120(approximately 9 USD) per vessel per year. The license fee for high sea fishing is based on the size of the vessel (gross registered tonnage) and the quota rights bought. Although the DTIS team requested information on the details of the license fee for high sea fishing, this was not forthcoming.  The fishery law that is currently in force dates from 1985. Together with the Regulation for Issuing the License to Fish in the Exclusive Economic Zone of The Republic Of The Maldives There is no efficient inspection of the EEZ, although there is the perception that illegal fishing by foreign companies is practiced. This is a direct loss to the economy.  But on top of this, the opportunity to develop the sector on the basis of a greater variety of raw material and products is also lost. The main constraint is related to the lack of modern inspection vessels. The Coast Guard acquired the vessels that are currently in operation second-hand more than 20 years ago.  One consequence is that post-harvest losses are substantial ranging from 15 to 25 per cent of the catch due to inadequate processing and cold storage capacity. Onboard preservation is also limited as only modern vessels have space for flake ice to preserve the catch. There are also only a few flake ice plants that are in operation. Mari culture, which is concerned with product preservation, is surprisingly underdeveloped in relation to the size and potential of the sector. This also implies that capacity to meet international quality standards is limited.  There is a shortage of proper infrastructure to support the industry and supply of quality product the short comings and as under:- Designated fishery ports with facilities for banking. Facilities for flake ice protection to reduce post harvest loss. Adequate facilities for catch shortage (chill and cold) to receive the landings. Slipways and workshops for repair and maintenance.

 The slow domestic transport increases the cost of post harvest products and decreases international comparativeness. Inter and Intra Island transport is always by boats with several difficulty‘ sand scheduling departure of products. For export product the situation is irrigative as the waiting time for refers container of the only export have at main port of mail.  In Maldives, domestic air freight of fish products is costly as carriers designed for refrigerated products are one only three transports companies that operate excepts fish product for transportation if there is unutilized space. There are no facilities for child or frozen products on carrier and also no cold room at Male airport which is the only export airport. Nowadays exporter have to time consignment with carefully and ship the iced product just in time for the schedule career take-off.  The non-alignment of policy with commercial opportunities is further reflected in the almost total absence of aqua-culture the cultivation of certain fish a species in the Maldives although the root provides a natural habitat in other countries because of recent development there is contract situation. For example, in Vietnam, there is major success in the agriculture sector. In Vietnam the export of white fish product and cultivated shell fish as increased 10 times. In 6th year creating new job opportunities in the primary secondary and tertiary sectors of the economy.  Finally Low level of value added activities, weak linkages with other economic sectors, and decline of the traditional cottage style processing- Inadequate policy measures to promote the sector as an employment and business opportunity is also reflected in the weak linkages to the tourism industry. Although resort and catering industry chefs demand fresh reef fish, crustacean products and the more expensive tuna species such as yellow fin and big eye for their clientele, supply has begun certain and inconsistent, leading in some case to fish imports.  Over fishing

Overfishing occurs when fishing activities reduce fish shocks below an acceptable level. This can happen in any type of pond to the oceans. Ultimately overfishing can lead to resource depletion in cases of subsidized fishing 100 biological growth rates and critical 100 bloomers levels.

For example overfishing of shares has led to the upset of entire Maine eco system .overfishing wholly depend on the ecosystem condition are suitable for the recovery. Dramatic change in special composition can result other equilibrium energy flows involve species composition other thon those that had been present before.

For example once prout have been overfished carp might take over in a way that makes it impossible for the broth to re-establish or breeding population.

 Environment impact of fishing The environment of fishing can be divided into two issue first issue involve the availability of fish to be caught like as sustainable fisheries , over fishing and fisheries management. Second issue that involve the impact of fishing on the other element of the environment such as by catch. These conservation issues are part of marine conservation and are addressed in fisheries since program. There is increasing gap between how many fish are available to be caught and humanities desire to catch them, this problem gets worst as worse population grows. Similarly to the environment issues there can be disagreement between the fisher man who depend on fishing for their livelihood and fisheries scientists who realize that if future fish population are to be sustainable then some fisheries reduced or even closed down.

 Spreading disease and parasites The capture transportation and culture of bait fish can spread damaging organisms between eco system endangering them .in the year 2007 many American states including Michigan, enacted regulations designed to slow the spread of fish diseases including viral hemorrhagic septicemia, by bait fish. Because of the risk of transmitting Myxobolus cerebralis (whirling diseases), trout and salmon should not be used a bait. Anglers may increase the possibilities of contamination by empting bait buckets into fishing venues and collecting or using bait improperly. The transportation of fishes from one part to another part can break the law and cause the introduction of fish diseases and parasites alien to the eco systems.

HANDICRAFT INDUSTRY

In the past Maldivian craftsmanship had a reputation of excellence which had reach to Arab nations. Because of industrialization followed opening of market in Maldives there is significant arrival of cheap, foreign produced handicraft and sector has fallen into darkness. Some research has shown that major reasons for these development involve comparative disadvantages of Maldives high transportation cost scattered geographic of an island state, lack of raw material and limited work force. Also explosive growth of tourism sector and related construction industry which has engaged all the craftsmen available in the market, and availability of cheap, imported handicraft products in the Maldives produced in other Asian countries with comparative and competitive advantage.

Traditionally handicraft sector in maldive includes embroidery ( kasabu boavalhu libaas), coir making, mat weaving and lacquer work. It is believe that all the skills are restricted to certain geographic reason or atolls. The island of gadhdhoo in gaafu dhaalu atoll is famous for its fine, hand woven mats made dried rushes used for prayer mats and as decoration. the supreme lacquer work is found in thulaadhoo in baa atoll. Wooden pots, vases and boxes of all kind of shape and sizes is shows beautiful patterns in red, black and yellow. Rin‘budhoo in dhalu atoll is well known fot its gold smith and hulhudeli in the same atoll famous for its silversmiths.

ISSUES FACING BY HANDICRAFT INDUSTRY IN MALDIVES

 Maldives Also Have Had Effects From The Globalization Situation In Maldives There Is More Demand For Modern Product Such As Tailored Clothing Composite Housing Needs And Increase In The Service Industry Led To Decrease In The Number Of People Producing Handicraft In The Country.  The Labor Force Decline Has Also Impacted Handicraft Industry Enormously Even Though It Is A Market For These Traditional Handicraft And Also Increase In Number Tourists Visit In The Country.  Import Of Goods By Near By Country Has Also Decreased The Production And Again Created A Subsequent Problem By Being Demanded More By The Customers Compare To The More Expensive Local Products Made From Imported Raw Materials With Little Labor.  In The Maldivian Handy Craft Industry Some Of The Weaknesses And Threats Are As Under: Little Product Innovation, Producer Are Not Completely Aware Of The Test, Of The Modern Tourist And Still Continue To Use Machinery And Tools Which Are Being Used Since The Beginning And Which Have Become Less Productive Therefore It Has Been Difficult For The Maldivian To Get Comparative Advantage Over Other Near By Countries Where More Modern Technology Is Used.  The Local Handicraft Products Are Considered More Expensive Then Imported From Other Countries. As A Result In The Island Of The Maldives Have More Demand For Cheap Imported Handicraft Than Those Produced By Local Craftsmen.  In The Handicraft Industry One Of The Main Factor Is Affecting Lack Of Raw Material Needed In Production. For Example Lacquer Work Is One Of The Areas In The Handicraft Industry That Has The Most Demand From The Locals As Well As The Tourists.

 In Maldives The Handicraft Industry Currently Lacks To Produce Stable Source Of Income For The Producers So They Are Unwilling To Leave The Jobs That Currently Provide Steady Flow Of Income And Switch To Crafting.

AGRICULTURE AND COTTAGE INDUSTRY

Agriculture continues to play lesser role Maldives and economy. The sector is constrained by limited availability of cultivable land and the shortage of domestic labor. Poor soil and scarcity of arable land have historically limited agriculture products such as banana, coconut, breadfruit, papayas, mangoes taro, betel, chilies, sweet potatoes, onions. Almost all the foods included staples imported for other countries. The December 2004 tsunami flooded several agriculture islands with salt water contaminating the groundwater. Some of these islands still do not have clean ground water. Agriculture accounts for 2% GDP. Cottage industry in Maldives consists mainly of garments production, boat building and handicraft which accounts for 7% GDP. Tourism industry gave major boost to the traditional cottage industry as lacquer work, handicraft, mat weaving and coir rope making. New industries have also emerged such as printing, production of PVC pipe, brick making marine engine, repairs, bottling of aerated water and garment production. ISSUE OF COTTAGE INDUSTRY

 In Maldives cottage industry face scarcity of capital and large quantity of labor, which force them to buy capital saving technique. Hence there is urgent need for implementation of techniques which not only increases productivity but also develops skills of the laborers and meets requirement of local markets.  In cottage industry laborers always face difficulties at every stage of their business like buying a raw material, promoting their products, arranging for capital and access to insurance cover extra. The laborers are exploited by the all. It is important to ensure that the benefit of value added services reaches the worker on time.  Cottage industry are also lacking when it comes to attract the attention of modern industry, there is the need of preservation and promotion of cottage industry through formation of public policies directed at improving the industry both in areas of technological aspects and income of laborers.

 There is lack of endeavors for the development of technology so that the labor can‘t enjoyed decent life style.

OTHER SOCIAL ISSUES

POPULATION PROBLEM

 The countries has smallest population of the network in absolute numbers i.e. according to escape population data sheet it is approximately 2,86,000 but the population growth rate is very high in the reason at 2.7% per year, which is although high much lower rate than those revealed in past censuses.  In the capital male the effects of high population growth rate and high population density are most noticeable. In Maldives houses are jammed closely together for length and breadth of that island which measures only 1 sq km. In Maldives the children are everywhere and almost half of the population is 15 years of age.  The country faces several other population problems. Early marriage i.e. before the age of 16 very common in male and other atolls. Although there is positive trend in the mean age of marriage, wide disparities exist between male and other islands.

CHILD LABOR

 Maldives is a small country with almost 1000 islands. The country is not heavily industrialists and not has much natural resources. Maldives depend heavily on import for other country.  For a long time in Maldives child labor has been existing but it is not talk about openly. Many children from other island come to male, the capital for studying and lead a very poor life. They have to work as a child labor in different industry. In addition many child workers are sexually abused. There are cases where child worker are bound to return the owners their belongings like books, cloths and other things when they are leaving. DRUG ABUSE

 In Maldives drug abuse is becoming major problem for the people. Maldives has population of just over 3 lakhs and almost few thousand people are addicted to the drugs, it will affect the country very bad way. Young people are getting addicted to drugs more.  In the islands around 20% of residents under age of 15 are using banned substances.

YOUTH ISSUES AND DYSFUNCTIONAL SOCIETY

 Dysfunctional families are root cause of emerging youth issues in Maldivian society.  Youth lack of supporting guidance in the education field because school management and teachers lack effective approaches for dealing with children from such families. While most families in Maldives are dysfunctional, Maldivians have a tendency to ignore problems and treat them as evils caused by others.

(PART 2, SEM-4)

AGRICULTURAL SECTOR-MALDIVES

Agriculture sector has little role to play in economy of Maldives due to shortage of cultivate land and labor. Because of adverse soil condition some limited crops such as coconut, banana, breadfruit, Papaya, Mangoes, taro, betel, chilies, sweet potato, and onion are cultivated in Maldives. Almost all food including staples has to be imported. In December 2004 Tsunami destroyed cultivable land with salt water in many islands spoiling the ground water till date there islands do not have clean ground water for agriculture. Agriculture provides about 2% GDP. The ratio of food imports to domestic food production is 10:1. Still some islands have sufficient soil and water for horticultures products. However, fishing still remains traditional lively hood. The scope for financing to the farmers is limited. There are constraints of transport and logistics affecting competitively priced inputs to agriculture islands as well as capital of Male and the major tourism islands.As 25% of production is spoiled before reaching Male and other islands.

AGRICULTURE SECTOR’S IMPORTANCE TO THE MALDIVIAN ECONOMY

Agriculture provides only 2% of GDP however sectors importance to the economy is greater than percentage of GDP. Because it provides employment and income opportunities in outer atolls, attaining food security and self reliance in part through import substitution of certain agriculture products. About 3.4% of Maldives labor force is engaged in agriculture and related activity. Sector provides employment to majority of female labor force. Most of the crops are grown with heavier concentration of root crops in southland more field and grain crops in north. Coconut is most common plantation crop in all the atolls as well as most popular home garden tree and also coconut is essential part of the Maldivian diet and its supply is sufficient for local use. The production of banana, Papaya, Watermelon, Chili, Pumpkin, Eggplant and Leaf cabbage has been increasing and they constitute a significant percentage of grower‘s income. The production of root crops like Taro, Cassava, and Sweet potato and grain is decreasing with increased in consumption of imported rice and wheat floor at administered prices.

Nowadays root crops are more of delicacy than every day staple food. Recently farming trend is increasing in resort island also. A total of 26 resorts have been recorded for producing significant part of their tropical vegetables and fruits. An important component of agriculture is also timber. Live stock production is limited to goat husbandry and poultry production. The poultry takes places primarily in rural islands. Agriculture crops are mainly grown with rain fed water. However, cash crops like chilies and watermelon are irrigated with extracted water

HEAVY IMPORT DEPENDENCY Almost all food requirements except fresh fish & coconut are imported. Rice is the staple food of the Maldivian and it is mostly imported from south east Asia. According to statistics from Maldives custom services, 66% of Rice & 90% of Wheat flour is imported from India. Maldives also import at 10% of fresh fruits, vegetables from India, Australia and Sri lanka.

ISSUE RELATING TO PRODUCTION

 Land Allocation No specific guidelines are issued to island offices on allocation of Land. They varies from island to the island.  Labor Scarcity of unskilled Labor & skilled labor hinders the commercial cultivation.  Lack of Technical Knowledge The farmers have Ltd knowledge and about pest control, Plant diseases and role of Pesticides in cultivation.  Lack of Access to credit There is easy access to credit with simple procedures and delay to the farmer but only few farmers have availed these resources.  Role of Women-Women have limited role in general & specially financial management of firms their role is limited to farm labor.

COMPARATIVE POSITION OF AGRICULTURE SECTOR IN INDIA

India has one of the world‘s leading producers of agriculture products and its produce large and different agriculture products. Agriculture constituted about 17.8% of India‘s GDP in 2007 and also provide employment half a billion people 52% of the total work force. It is dominated by small scale farming and it is also have charactertics of law labor productivity, at about one sixth of the level in other sectors of the economy.

OTHER IMPORTANT FEATURES

 India is among the world‘s leading producer of paddy rice, wheat, buffalo milk, cow milk, and sugarcane. It is either the number one or the second largest producer in eight out of its top ten products. Some of these are widely traded and some are more specialist products.  India is now the largest milk producer in the world and the second largest producer of paddy rice, sugar cane, wheat, cow milk, groundnuts and some fresh vegetables.  India trade in agriculture & food products is relatively small share of overall Indian trade. Agriculture exports represent 9% of the value of the total exports whereas share of agriculture in total imports is just 5%.

IMPORTS & EXPORTS FROM INDIA TO MALDIVES 2003 TO 2010* (Source-International Trade Policy Division Ministry of Economic Development & Trade- September 2010) TABLE 1 YEAR IMPORTS % OF TOTAL EXPORTS % OF TOTAL

(000’S) IMPORTS YEAR (000’S) EXPORTS

US $

2003 47,558.32 10.1 346.98 0.3

2004 65,577.17 10.3 456.18 0.4

2005 83,538.21 11.3 1,015.23 1.0

2006 87,024.70 09.4 1,255.40 0.9

2007 125,900.00 11.5 1,972.05 1.8

2008 144,008.35 10.4 1,947.47 1.5 2009 116,505.38 12.1 1,723.16 2.3

2010 36,819.23 14.87 733.19 4.8

 Exports from Maldives to India of negligible but imports from India to Maldives are quite substantial. Since last few years imports from India has increased steadily.

 MAIN IMPORTS BY INDIA TO MALDIVES INCLUDE River sand & Aggregates. Groceries like Onions, Potatoes, Egg Wheat Flour, Rice & Sugar. Cement. Household &food stuffs including fruits and vegetables. Garments Medical & Surgical Equipments. Electronics.  MAIN EXPORTS TO INDIA BY MALDIVES INCLUDE Live Ornamental Fish. Frozen / Fresh or Chilled Yellow fin Tunas, Fillets, and Loins. Fresh or Chilled Big eye Tunas and Loins. Fresh or Chilled Grouper, fillets and Loins. Frozen / Fresh or Chilled Marlin and Loins. Shells & Battery Waste, Shark-Liver oil. Aluminums, Copper, Tin, Alloy Steel Waste & Scrap.

IMPORTS & EXPORTS FROM INDIA TO MALDIVES 2003 TO 2010* CHART 1

RICE-STAPLE FOOD OF MALDIVES

Rice and Crushed Rice is the most important food crops in India. It contributes about 40% of food grain production. Rice is mostly Rain-Fed crop except in the state of Punjab, Haryana, Andhra Pradesh and Uttar Pradesh, where majority of share of the crop is irrigated. Rice is planted in the ―Kharif ―season after the onset of monsoon in June. Also small portion of crop called ―Rabi‖ is taken in the states of west Bengal, Andhra Pradesh, Orissa and Tamilnadu. High yielding seeds verily is limited to the states which use irrigation. Use of fertilizer at the national level is not so high but is near optimum in these states.

INDIA’S RICE AREA, PRODUCTION AND YIELD CHART 2

MAJOR PRODUCT GROUP EXPORT REPORT (Source-www.apeda.com) TABLE 2 COUNTRY: QTY IN MT FROM INDIA TO MALDIVES VALUE IN RS. LACS

YEAR PRODUCT QTY(2010-11) VALUE(2010-11) 2010-11 Non Basmati Rice 11,757.16 2,434.53 Cereal Preparations 1,013.59 514. 93 Fruit and Vegetable Seeds0.70 0.43 Basmati Rice 39.03 19.77

2009-10 Non Basmati Rice 22,655.73 4,355.58 Cereal Preparations 531.69 319.37 Fruit and Vegetable Seeds1.57 0.68 Basmati Rice 142.72 75.84

2008-09 Non Basmati Rice 15,885.21 2,954.94 Cereal Preparations 721.33 356.58 Fruit and Vegetable Seeds1.54 5.58 Basmati Rice 0.84 0.13

2007-2008 Non Basmati Rice 17,618.25 2,390.97 Cereal Preparations 573.43 251.72 Fruit and Vegetable Seeds0.01 0.10 Basmati Rice 11.23 3.83

2006-2007 Non Basmati Rice 15,712.91 1,989.44 Cereal Preparations 369.52 192.39 Fruit and Vegetable Seeds3.10 5.37 Basmati Rice 22.85 7.27

SWOT ANALYSIS OF AGRICULTURE SECTOR OF INDIA STRENGTHS  Positive and different agro climate conditions.  Big idle area of cultivable agriculture land.  Existence of large number of Indian product with export potential.  Here exists local and foreign markets.  Availability of huge labor force.  Government‘s subsidies and tax relaxations.  Largest crop area with various soil types (46 out of 60 soil types) WEAKNESSES  Competitor countries have technological advantages.  Small size of agriculture holdings with poor farmers & poor infrastructure.  Inadequate manufacturing capability and finalization of product.  Long standing shut from the international market.  Insufficient professional education of agriculrists.  Produce do not meet international standards.  Complex approach to credit giving and lending.  Dependence in monsoon. OPPORTUNITIES  Joining together agriculture and tourism.  Standardization with WTO.  Initiating production specialization of some authentic products.  Attract foreign investment in agriculture sector.  Still untapped markets in European countries.  Contract farming.  Information technology aid to growth.  Creating awareness among cultivation. THREATS  Global recession and decrease purchasing power of the people.  Cheaper and better quality products being produced and offered by competitors.  Urbanization and people going for other job as source of income.  Reducing water level & climate changes.  Emergence of SEZs on risk cultivable lands. OVERVIEW OF THE AGRICULTURE SECTOR IN GUJARAT  In Gujarat out of the total geographical area of 188 lakh hectares, cultivable area is around 124 lakh hectares (66%).  The major crops in Gujarat are Wheat, bajra, rice, maize, groundnut, mustard, sesame, pigeon pea, green gram, gram, cotton, sugar cane, mango, banana, cheeku, lime, guava, tomato, potato, onion cumin, garlic, isabgul and fennel.  Gujarat is the largest producer of castor, tobacco, isabgul (psyllium) and the second largest producer of sesame seeds, cotton and groundnut in the country. OVERVIEW OF THE GUJARAT’S POSITION

Major crops Rice. Wheat, Maize, Oilseeds, cotton, Fruits, Vegitables and Spices

Working factories Out of the 2.3 lakh working factories employing 12.90 lakh, 17922 factories belong to the food and agro products Education & research 4 agricultural universities providing education and conducting research in various fields of agriculture Food and Agro small Milk products-Ahmedabad & Rajkot, Rice & Dal processing- Ahmedabad industry clusters in , Anand, Confectionary-Ahmedabad, Salt- Amreli, Kuch, Surendranagar, districts of Gujarat Tobacco-Mehsana ,Patan, Anand, Processed Spices & Papad-Ahmedabad Major players in food Parle ,Vadilal, Reliance fresh, Rasna, Adani, Godrej, Vimal, Amul processing industry

PRODUCTION OF GRAINS IN GUJARAT (Source-google images)

CROPS AND THEIR GROWING AND PROCESSING AREAS

(Source: Gujarat Agro Industries Corporation Limited)

TABLE 3

CROPS GROWING AREAS PROCESSING AREAS

Groundnut Junagadh, Rajkot, Amreli, Bhavnagar, Rajkot, Junagadh Jamnagar, Kutch and Surendranagar Sesame Bhavnagar, Amreli, Rajkot, Junagadh, Bhavnagar, Amreli and Jamnagar, Kutch and Surendranagar Ahmedabad Castor Banaskantha, Kutch, Sabarkantha and Mehsana Banaskantha, Vadodara Rice Navsari, Surat, Valsad, Anand, Kheda and Navsari, Ahmedabad Ahmedabad Pulses Vadodara, Bharuch, Dahod and Panchmahal Vadodara, Dahod

Cumin/Fennel Patan, Banaskantha, Rajkot, Mehsana, Mehsana Ahmedabad,Junagadh and Surendranagar Isabgul Banaskantha and Mehsana Mehsana

Banana Anand, Kheda, Bharuch, Narmada and Surat ---

SWOT ANALYSIS (GUJARAT AGRICULTURE)

STRENGTH

 In Gujarat State majority of geographical land area (60.62%) is under cultivation.  Kheda, Amreli, Gandhinagar, Surat, Mehasana, Patan, Anand and Bhavnagar districts have more than 70% of their area under cultivation.  Land is fertile for variety of crops viz Castor, Cotton, Wheat, Bajra, Pulses, Cumin, Onion, Garlic, Gram, Sugarcane, Mango, etc.  State has 4 Agriculture Universities. Also, it has many repudiated agriculture institutions.

WEAKNESS

 Only 36% of the cultivated land are irrigated, still 64% are rain fed. There is need to have more and more area under assured irrigation.  Only 10% of the geographical area is covered by forests. It requires to be increased for ecological balance.  Training facility is not properly utilized. Lack of proper training programmes and direction are the main reasons. Hence, Farmers‘ training is not frequent phenomenon in the district.  Coastal districts – Junagadh, Porbander, Amreli, Bhavnagar, Jamnagar, Valsad, Navasari, Bharuch have major problem of salty soil.  Only primary agriculture marketing facility is available in most part of the state. OPPORTUNITY  About 40% of the land is not under cultivation. Part of them may be used under watershed development programmes.  64% of the cultivable land is still rain fed. They may be brought under irrigation by providing irrigation facilities through bore wells and micro irrigation system.  Forest coverage is only 10% .Tree plantation may be carried out on massive scale under social forestry scheme.  A Taluka Seed Farm may be opened in each taluka of the state.  More and more educational programmes for farmers may be organized.  A continuous programme may be organized for making the people aware about various developments in agriculture and allied sectors.  More and more area can be covered under micro irrigation system THREATS

 People are not much aware about various Government Schemes including RKVY (Rashtriya KrishiVikasYojana)

NORMS AND POLICIES OF MALDIVES FOR IMPORT INCLUDING TAXATION

TRADE POLICY OBJECTIVES AND FRAMEWORK

 The primary objective of Maldives trade policy is to establish favorable environments for speedy commerce and economic activity focusing on diversifying the economy with export- oriented trade in services and industrial development focusing to achieve the main objectives – poverty alleviation and improvement in the standard of living – of Maldives.

 Since many years Maldives has maintain relatively open trade policy with no major direct trade measures, how tariffs keeping non tariffs measures to an absolute minimum. The free trade policy will be maintained and improved as per government development policies and priorities. Further bilateral regional and multilateral approach to free trade will be pursued.

LAWS ON EXPORT AND IMPORT AND LAW ON PROHIBITED IMPORTS  The main law governing international trade is the law on export and import of 1979( Law No: 31/79) which stipulates the conditions and procedures for the imports and exports of goods and entrusts the Ministry of Economic Development (MED) as the authority to regulate export and import.  The Law mandates the authority to determine the customs tariffs on the products imported into the country. The tariff remains the main trade policy measure, and is mainly used as a revenue instrument accounting for nearly two third of tax receipts. Some tariffs are levied on environmental, health and religious grounds.  Government has the discretion to exempt duty, especially if these imports are use for industrial purposes and development of infrastructure and tourist resorts. However, Government stopped duty exemption on imported items that are to be used for resort development since 2006.  Government aims to reduce the dependence on import revenue as an income source for government expenditure and recently proposed much wider tax reforms. In this background, in June 2009, government proposed amendments to the export-import law to eliminate import duties on foods items and lower it for other commodities.  The proposed amendments to the import and export law intend to address three broad policy considerations which include economic development objectives, environmental objectives and WTO obligations during its formulation.  The government foresees that the proposed amendments will be initially costly. Therefore, in order to compensate the loss of revenue government has also submitted a corporate tax bill in parallel to parliament as a part of new broader tax regime which includes income tax and goods and service tax.  There are no changes to the Law (Law No: 4/75) on Prohibited Imports since last trade policy review. Under this, goods are prohibited on the basis of national security and religious grounds.  With effect from 1st of January 2006, a separate set of duties is being applied to goods importing from South Asian Association of Regional Cooperation (SAARC) member countries under the South Asian Free Trade Area (SAFTA)‘s Tariff Liberalization Program (TLP) for least developed countries (LDCs) which includes Bangladesh, Bhutan, Nepal & Maldives and for Non-LDCs which include India, Pakistan & Sri Lanka- Tariff reductions under the TLP (Trade liberalization program) are divided into two phases. Under phase one, Non-LDCs must reduce existing tariff rates (except for items included in national sensitive lists) by at least 20% within the first-two years from the date of coming into force of the Agreement, while for LDCs, tariff rates (for items not in the sensitive lists) have to be brought down to 30% over the same period. Under the second phase of the TLP all Non-LDCs have to bring down all tariffs to a range of 0 - 5% at the beginning of 2013. For LDCs, the same reduction has to be achieved at the beginning of 2016.  The Agreement puts special emphasis on special and differential treatment for LDC member states, specifically: Giving special regard to the situation of the LDCs when considering the application of anti-dumping and/or countervailing measures. Greater flexibility in continuation of quantitative or other restrictions provisionally and without discrimination in critical circumstances by the LDC member states on imports from other Contracting States. Considering, where practical, taking direct trade measures with a view to enhancing sustainable exports from LDC States, Establishing an appropriate mechanism to compensate the loss of customs revenue of LDCs arising from the implementation of TLP, until an alternative domestic arrangements are formulated to address this situation.  A separate article on special and differential treatment for Maldives is also included in the Agreement stating that after graduation, Maldives will receive no less favorable treatment than that accorded to LDC member states.

BILATERAL TRADE ARRANGEMENT

 The oldest bilateral arrangement, as identified in the first Trade Policy Review report, is the agreement in force since 31 March 1981 which is known as "Trade Agreement between the Government of the Republic of Maldives and the Government of the Republic of India".

NORMS AND POLICIES OF INDIA FOR EXPORT INCLUDING TAXATION  India‟s agro-food export policy is balancing between an objective of stimulating farmers‟ income through encouraging exports in particular of horticultural products and a food security objective leading to ad hoc restrictions on exports of commodities regarded as essential for domestic consumers.  With the primary objective of boosting agricultural exports, the Government of India announced in 2001 a policy of setting up of Agriculture Export Zones (AEZs) across the country. The objective was to utilize various support schemes in a co- ordinated manner, selecting particular products for the purpose of developing and sourcing the raw materials in a specified area and then linking this with their processing and packaging for export. The zones receive support from the central and state governments as well as from various governmental agencies in particular for development of infrastructure like storage, transport, processing and value addition facilities, but also in the form of research and development, extension services and inputs. So far, 60 such zones have been established across 20 states. They are monitored by the Agricultural and Processed Food Products Exports Development Authority (APEDA).  The Vishesh Krishi Upaj Yojana (special agricultural products scheme) introduced in 2004 promotes exports of fruits, vegetables, flowers, minor forest produce, dairy, poultry and related value-added products produced domestically.  Under the Advance License scheme, duty-free import of agricultural inputs required for export production are allowed with an obligation to export associated agricultural products.  India last notified its export subsidies to the WTO in March 2002 for the period 1996/97-2000/01. Since then, no official notification was submitted to the WTO (WTO, 2007); nevertheless, products such as, e.g. cereals, sugar or cotton procured at Minimum Support Prices are occasionally supported by export incentives to cover the cost of handling, processing and internal transportation.  Since the beginning of the 1990s, India has gradually removed prohibitions, licensing, and other restrictions on exports. However, to balance domestic supply and demand for commodities considered as crucial for food security and to stabilize domestic prices, notifications are made periodically to restrict exports or lift export restrictions on selected agricultural commodities (WTO, 2007). Wheat: in February 2007, the government banned exports of wheat and wheat products until end December 2007, which was then extended indefinitely. Non-basmati rice: in October 2007, the government banned exports of all non- basmati rice. However, responding to demands from rice exporters and some governments of major rice exporting states in India, the government decided to establish a minimum export price (MEP) of USD 1 000 per tone on 27 March 2008, and completely banned exports as from 1 April 2008. Basmati rice: to limit exports, at the end of April 2008, the government announced that MEP would be reduced to USD 1 000 per tone but an export duty of USD 200 per tone would be imposed.  In addition to temporary restrictions, India prohibits exports of certain agricultural products for health, environmental, and religious reasons. For example, for social and religious reasons such a prohibition is applied for exports of beef and offal of cows, oxen and calves. In turn, export licensing is applied for live animals and some animal products, seeds, seaweed and other algae, residues and waste from food industries, as well as pure races of silk worm and silkworm seeds.

GROWTH POTENTIAL FOR INDIA

 Indian agriculture has made very good progress from food shortages and imports thereof to self sufficiency and export to other countries.  It has moved from subsidence farming to intensive and technology led cultivation.  There are 39 plan schemes promoting private investment in domestic trading, post harvest management, export quality management and support initiatives for capacity building food safety and improving market information.  In the 11th year plan(2007-2012) the government of India proposed the strategy for growth of agriculture sector Bringing more area under irrigation. Better management of water resources by including rain water, harvesting and water shed development and land resources by reclaiming degraded land. Diversification into high value crop agriculture. Diversification into animal husbandry and fishery.

OPPORTUNITIES FOR INDIA  Demand-side growth along with government initiatives expected to help India become a leading agro country-  India is one of the fastest growing global economies and is the world‟s converging point of focus amidst narrowing boundaries and well-connected international regions. The huge employment in agriculture sector in India‟s rural population is directly responsible for India‟s growth dynamics.  In 2050 India‟s population is likely to reach around 106 billion there by creating a huge domestic demand for agricultural products.  In agriculture sector government policies and initiatives are expected to boost the growth. As per the organization for economic co-operation and development-food and agriculture organization -by 2015.India is estimated to produce worlds 2.1% of wheat & 21.8% of rice production.  Agricultural inputs expected to grow due to increased production levels-

With the production levels expected to grow, agricultural input such as fertilizers, farm equipment and machinery, irrigation facilities, institutional credit, and research and development are expected to be driven towards a higher target. These inputs are an essential part of the agribusiness, and provide opportunities across different levels in the agriculture value chain.  Involvement of Private sector is likely to boost Indian agriculture sector- In India private sector can focus more on agriculture to boost the production by venturing into organic farming, contract farming and setting up hubs for the procurement of firm produce. Increased investment by corporate in agriculture sector can offer new frontier of growth in many areas such as economies of Scale through advancement model of farming effective distribution systems and food security. Investment by private equity (PE) in food processing and agriculture based companies can also boost further employment in the sector. PE players have invested US $ 300 million in these companies during January- June 2010.

BARRIERS OF AGRICULTURE SECTOR  Barriers Related to Product Standards A present main concern for India‘s exports are product standards. There are many barriers regarding product standards. Even a small part of this potential is allowed to be exploited the implementation of the free trade regime could became dominated by protectionists and those who would welcome trade retaliation however transparency and harmonization of standards could become trade facilitators in addition to providing technical quality and safety parameters. Ex-[Rice] There are about 600 varieties of rice grown in India. These includes basmati & non basmati. During survey it is found that there are various specification by importing countries on percentage of broken rice, both basmati and non basmati rice. These varies from 20 to 25% for rice ( non basmati) in ASEAN like Malaysia & Singapore. However, Sri lanka accepts up to 100% broken rice non basmati, these shows that multiplicity of product standards among various countries. Due to these various standards exporters are unable to meet individual country‘s demand. Thus, harmonization of standards is very important to begin with.  Natural resources: Increasing competition over availability of water, declining soil fertilizers, lack of investment in sustainable utilization & genetic resource conservation.  Production systems and structure: Increasing land policy conflicts, declining investment in agriculture sector by public investment, non sustainable small holder suggestions.  Technology: Crop biotechnology increasing non -traditional demand for agriculture products and rising role of IT.  Trade and markets: WTO and agriculture- continued protectionism of US, EU, Japan, Emergence of food MNCs; Emphasis on protection process in addition to product standards- traceability.

MAJOR CATEGORIES OF NON-TARIFF BARRIERS  Quantitative restrictions and similar specific limitations Various quantitative restrictions are implemented through various policies and action like import Quota, export quota, licensing requirements for import & export voluntary export restraints, prohibitions, foreign exchange allocation restriction, surrender requirements, import monitoring temporary bans aimed at balancing trade, discriminatory bilateral agreements, counter trade domestic, content and mixing requirements mandatory certification and allocation processes for quantitative restrictions  Customs procedures and administrative practice Several custom procedures and administrative practices often create barriers to foreign trade. There are excise and special custom formalities such as stamping, custom charges, decreed customs valuation, minimum import prices, customs classification procedures, custom clearance procedures, minimum custom value.  Imports affected by non-tariff charges and related policies imports of the country can be affected by some policies and non-tariff charges such as special sales taxes, variable levies, border tax adjustments, value added tax, anti dumping duty, cash margin requirements and rules of origin.  Government participation in trade, restrictive practices and more general policies Governments often provide subsidies and other aids, participate in State trading and designate goods subject to specialized management by line ministries. In addition, they formulate State procurement policies, tax exemptions for critical imports, and single or limited number of channels for imports of food and agricultural products. All of these can act as non-tariff barriers.  Technical barriers to trade various technical requirements can also act as non-tariff barriers to international trade on different grounds. government after sets standards for example health and sanitary regulations, quality standards, safety and industrial standards and regulations, packaging and labeling regulations, advertising and media regulations.

 OTHER BARRIERS In developing countries changes in consumption of agricultural products. Shift in consumptions mix from cereals to fruits, vegetables and meat. Production will outpace population growth. Entrance of food MNCs in the country. Emergence of powerful retail chains.

SUGGETIONS FOR PROMITING EXPORTS

 Infrastructure development lack of sufficient infrastructure particularly cold storage facility and transportation can be considered major obstacles for exports. by inviting private sectors to increase infrastructure under public private partnership can boost exports of the country.

 Marketing strategy Presently when all qualitative restrictions have been removed and there are many opportunities for developing countries to have access to global markets, it is necessary that an effective marketing strategy is worked out focusing on major items of import by countries and concentrate on such products using the comparative advantages. Focused should be made on countries in the European union and African countries.

 Contract Farming: Contract farming needs to be encouraged not only to provide a broad base for raw materials for processing but also for the supply of the right type of inputs and other linkages necessary for the acceptability of the quality standards for competitive exports.

 Human resource development human resource development plays a very important role for exports. Exporters should be imparted proper trainings regarding quality standards and sanitary measures that may be implied with.

 Market Access and Information There is a need to provide continuous updating of data on market information, market access, procedures and processed etc.

 Biotechnology in the Asia pacific region, India has been recognized as one of the 5 top biotechnology leaders. because of biotechnology the cost of production reduces and productivity improves, given the low cost but high caliber work force there is need to optimal utilization of intellectual and biological resources with a view to bring cost effectiveness in the production.

 Credit Facilities: The EXIM Bank, in consultation with APEDA and the Ministry of Agriculture, may set up Farm Export Promotion Cells in each AEZ and provide necessary technical support and guidance to the exporters. It can also open offices in each state in order to promote agricultural-export and also establish overseas branches in countries where Indian exports are favorite destinations.

 Economies of scale: Economies of scale and brand-banding can only happen when large and big companies enter the sector. In this respect, contract farming and corporate farming should be extended credit facilities with liberal terms and making storage, movement, processing, marketing and trade of farm commodities free from regulations and controls.

 OTHER SUGGESTIONS Efforts should be made to encourage public- private partnership for investment in infrastructure such as irrigation, electricity, roads, rural markets, cold storages agriculture research and transportation etc to reduce the transportation cost. The farmers should be encouraged for forming their associations thereby jointly producing and processing commodities for international markets at regional and global levels. They should be motivated for formation of SHGs for cultivation, processing, marketing, nurseries, seed production etc and linking such initiatives through contract farming and corporate farming. For development of viable and cost effective seed industries sufficient investments are required. Proper institutions should be developed with public private partnership and providing support to them for vertical integration of production, processing, packaging and marketing of agricultural products. Diversification from cereals to high value crops such as fruits, vegetables, floriculture, spices, animal husbandry, fisheries and medicinal and herbal crops. CONCLUSION  Agriculture has prominent position in Indian economy because of its contribution to GDP as well as large number of population is dependent on the agricultural sector for its livelihood.  It is generally discussed during policy making about focus on the need to improve infrastructure, expand higher education and allow greater foreign entry in the country. These forms are very critical for any country but without progress on reforms on improving basic education and nutrition, boosting productivity in agriculture sector and easing strict labor laws India cannot take advantage of its population windfall and realize the projection of Indian optimists.  In recent times the growth in Indian exports is due to increase in productivity, growth in world trade, increase in intra – industry trade and external sector reforms.  It is required to strengthen the reliable statistics on food, agriculture and live stock for proper decision making. Implementation of reliable market information system and regular publications on agriculture statistics should be insured. This will help in convincing the financial institutions for providing financial support for agricultural activities there by small farmers be benefited.  In India due to the growth of service economy, the share of agriculture will diminish which can also have implications of India‘s stance on trade and agriculture policy in the future.

REFERENCES

 National Communication of Maldives to the UNFCCC  Manik, A.A. (2001), ―Flood risk assessment: appropriateness of a GIS based approach for small island states such as the Maldives‖. Unpublished Masters Dissertation. University of Portsmouth, United Kingdom.  Maniku, H.A. (1990), ―Changes in the Topography of the Maldives‖. Malé: Forum of Writers on Environment.  MCPW (2001),Direct communication with Ministry of Construction and Public Works.  MCS (2001), Direct communication with Maldives Customs Service.  Manishmanwah .name/ agriculture _approach  en.wikipedia.org/ wiki /agriculture_ in India  www.Indiamba.com / faculty column /FC703/fc703  TRADE POLICY REVIEW, Report by MALDIVES

 Anderson, K., M. Kurzweil, W. Martin, D. Sandri and E. Valenzuela (2008), “Methodology for Measuring Distortions to Agricultural Incentives,” Agricultural Distortions Working Paper 02, World Bank, Washington, DC, revised January.  APEDA(2008), www.apeda.com/apedawebsite/trade_promotion/Agri_Export_Zone.htm; http://dgft.delhi.nic.in/ [viewed 1 October 2008]. GAIN-IN8015 (2008), India, Grain and Feed Annual, USDA FAS, 20 February.

“FINANCIAL MARKET OF MALDIVES & TOURISM IN MALDIVES”

INDEX

Sr. No. Particular PART-1 Introduction to Maldives Structure and hierarchy in Maldives companies Financial System Financial Markets Maldives Stock Exchange Market Regulations Financial Institutions Monetary Policy Overview of Government Securities PART-2 A Introduction of Maldives Tourism History Ecotourism in Maldives Major Functions of Tourism Department Roles of Tourism Sector The Maldives Honeymoon Structure of the Industry Maldives adopts new slogan and logo B Comparative study of Industry Import/Export Partner Maldives registers a 3.3 percent growth in tourist arrivals in the first quarter of 2012 Maldives Business International tourism, number of arrivals C Notice by Ministry of Tourism, Arts & Culture regarding Accommodation facilities Taxation Maldives: Trade Profile Tourism not hit but worries for Indian investment Tour agents fear dip in travel to Maldives Political Crisis Threatens Tourism in Maldives General Import Restrictions D Maldives Participates in SATTE in New Delhi Foreign Investment Services Bureau (FISB) Maldives Business - Investment opportunities Conclusion Bibliography

PART-1 “FINANCIAL MARKET OF MALDIVES”

Introduction to Maldives:-

Overview

 Official name – Republic of Maldives  Population – July 2011 estimate 394,999(est.) - Density 10,036.9/km2 (11th) 2,866.9/sq mi  Official Languages – (Divehi)  Currency – Maldivian Rufiyaa (MVR)  Capital city – Male  GDP – GDP (PPP) 2011 estimate - Total $2.931 billion - Per capita $9,005 (87th) GDP (Nominal) 2011 estimate - Total $2.062 billion - Per capita $6,336

Overview: The Maldives consists of a chain of coral atolls, 80-120 km broad and 860 km long, located on the Lacadive-Chagos submarine ridge in the Indian Ocean. It includes 26 natural atolls and the land is divided between 1190 islands of which 198 are inhabited. Historically these islands have been divided into twenty executive regions also known as atolls. Over 80% of the land area of these islands is less than 1 meter above mean sea level.

Structure and hierarchy in Maldives companies:

Organizational Structure and Functions

The Maldives Monetary Authority is prepared in six Divisions: the Banking and Payments Settlement Division, the Economic Research and Statistics Division, the Human Resources Division, the Financial

Sector Division, the Information Technology Division and the Corporate Division.

Organization Chart

FINANCIAL SYSTEM:

Introduction:

The financial sector in the Maldives is a very slim and subject through the banking industry. There are seven banks which are currently operating in the Maldives and it one locally owned commercial bank, branches of four foreign banks, one locally incorporated supplementary of a foreign bank and an Islamic bank. The Non-bank financial institutions in the country consist of a finance leasing company, a particular housing finance institution, insurance companies, money services businesses and securities market intermediaries.

All banks and the non-bank financial institutions, except for the securities market intermediaries are licensed, regulated and supervised by the Maldives Monetary Authority. The Capital Market Development Authority (CMDA) is the regulator for the securities market in the Maldives. It has legal powers to license securities market intermediaries including brokers, dealers, investment advisers, as well as stock exchanges and central depositories.

Banking Sector: Banks currently in operation:

1. State Bank of India (SBI) - established as a foreign bank branch in 1974. 2. Habib Bank Limited (HBL) - established as a foreign bank branch in 1976. 3. Bank of Ceylon (BOC) - established as a foreign bank branch in 1981. 4. Bank of Maldives Plc. (BML) - established in 1982, a public limited company with greater part ownership by the Government of Maldives. 5. Hong Kong Shanghai Banking Corporation Ltd. (HSBC) - established as a foreign bank branch in 2002. 6. Mauritius Commercial Bank Maldives Pvt. Ltd. (MCB) - established as a branch of the Mauritius Commercial Bank in May 2008 and converted to a supplementary of the Mauritius Commercial Bank in September 2010. 7. Maldives Islamic Bank Pvt Ltd. - established in March 2011, owned by Islamic Corporation for Development of the Private Sector (ICD) and the Government of Maldives.

Non-Bank Financial Sector (NBFIs)

Non-banking financial institutions includes different players in the general insurance market, a finance leasing company, a specific housing finance institution and money transfer businesses in the Maldives.

Until September 2004, the insurance market has been almost unregulated, when a new set of regulations was introduced with the objective of facilitating the orderly expansion of the insurance sector.

The Maldives Finance Leasing Company Pvt. Ltd., established in May 2002. It is the only player in the finance leasing market. The company was setup as a joint venture between five domestic public and private sector entities and two international parties, in order to address the demand for medium to long-term tools financing from all sectors of the economy. Financial Markets:

 Financial Markets refer to the market for borrowing and lending of funds. They provide facilities for buying and selling of financial claims.

1. Capital Market: A capital market may be defined as the market for borrowing and lending of long term funds. It is concerned with the raising of capital for the purpose of investment. Capital market is a market where securities issued by firms (ie shares, bonds and debentures) can be bought and sold freely.

The capital market is classified into:

 Primary Market: The primary market or the new issues market refers to the raising of new capital by the issue of new shares, debentures and bonds.

 Secondary Market: The secondary market or the stock exchange is the market for old or already issued securities. It comprises of the stock market in which industrial securities are bought and sold.

Maldives Stock Exchange:

The Maldives Stock Exchange first established on 14th April 2002 was founded by the Capital Market Development Authority (CMDA) as part of the regulator. However to separate the Exchange operation, Maldives Stock Exchange (MSE) was approved as a private sector exchange by Capital Market Development Authority (CMDA) on 23rd January 2008 under the Maldives Securities Act.

As such the MSE is started by the Maldives Stock Exchange Company Pvt Ltd, effective from 24th January 2008.

The most important function of MSE is to assist companies raising capital through the issue of new securities. The minor function of the MSE is to offer a regulated market for the trading of existing stocks between investors. The MSE is also the centre for trading, reporting and pricing of the stocks. The trading information is released to the public by the MSE ensuring clearness in market dealings. (6) VISION

"To be a leading private sector institution which contributes to the economic development of the nation?"

(7) MISSION

"To provide a liquid secondary market for securities to raise funds, and maintain market confidence."

(8) SERVICES

Give facilities for buying, selling & dealing in securities on the MSE Offer a clearing service for securities traded on the MSE Development & promotion of the Securities Market

(9) CONTACT

Maldives Stock Exchange Company Pvt. Ltd. Champa Centre Point, 6th Floor,Chandhanee Magu Phone: +960 330 7878 Fax: +960 330 5034 www.mse.com.mv

(10)

(11) WORKING HOURS

MSE are opened Sunday to Thursday from 8:00 am to 4:00 pm apart from bank holidays. MSE are getting letters and other documents/data between 8:30 am to 3:00 pm only.

IV. MARKET REGULATIONS

The Capital Market Development Authority (CMDA) is dependable for the developing and regulating the capital market in Maldives. CMDA is doing dissimilar work, it includes issues license to securities market including brokers, dealers, investment advisers, as well as stock exchange and central depository.

Securities Act Licensing & Conduct of Business Regulations Securities (General) Regulations 2007 Listing Rules Code of Corporate Governance Trading Membership Rules Trading Policy V. FEES AND FINES

Initial Listing Fee (Equity Securities) Fee (Mrf)

Main Board 50,000

Second Board 25,000

Listed Companies = Sum of Daily Market Capitalization for the year / Number of trading days for the year

(Note: Daily Market Capitalization = Last Traded Price of the day x No. of Shares Issued)

New Listings = Total Issued Share Capital x Issued Share Price

Capital Market of Maldives:

 The Capital Market Development Authority (CMDA) was recognized under the Maldives Securities Act in year 2006 .CMDA is dependable for amendable and developing the capital market in the Maldives. It has been helpful in developing the regulatory environment as well as the infrastructure for the organization of the securities market. There are some Institutions that are regulated by the CMDA includes dealing companies, brokers, the stock exchange and central depository. In 2008, the Securities Trading Floor and the Securities Depository were separated from the CMDA. As such, on January 2008 Maldives Securities Depository (MSD) and Maldives Stock Exchange Company Pvt Ltd were formulated as private sector institutions under the Maldives Securities Act.

 Public have a investment opportunities it include a limited number of shares in the Bank of Maldives Plc (BML) and three other state owned public companies – Maldives Transport and Contracting Company Plc (MTCC), State Trading Organization Plc (STO) and Maldives Tourism Development Corporation Plc (MTDC). Dhivehi Ekuveri Kunfuni Plc (DEK) is also a one company which listed in the Maldives Stock Exchange, and privately owned company. In the derivative market these companies shares are traded during the Maldives Stock Exchange Company Pvt Ltd.

 At present there are three licensed dealing companies which include Stock Brokers Maldives Pvt Ltd, First Option Pvt Ltd and Aariya Securities Pvt Ltd.

 In terms of a main market for debt securities, neither government securities nor private sector commercial debt instruments are now available to the common public. However, the Housing Development Finance Corporation Plc (HDFC) has rendered three corporate bonds which have been subscribed by institutional investors including the commercial banks and some of the public enterprises. Furthermore, Maldives Monetary Authority on behalf of the government, issues Treasury bills to commercial banks and state owned enterprises for the intention of financing the budget insufficiency.

2. Money Market- for short-term funds (less than a year)

 Organized (Banks)

 Unorganized (money lenders, chit funds, etc.)

 Foreign Exchange Market: In this market foreign currency is made available. It comprises of the RBI, approved dealers in foreign currency, money changers, foreign banks, exporters and importers. The Indian forex market has matured in depth in the 1990s.

 Government Securities Market: Government requires important amount of funds to devote in economic and social projects. The market in which Government securities are purchased and sold is known as the Government securities market.

 Treasury bills are issued for raising short term funds while bonds are issued for long term funds. Market for Government and semi government securities is known as the Gilt edged market.

Financial Institutions:

1) Bank of Maldives Plc. 2) State Bank of India 3) Habit Bank Limited 4) Bank of Ceylon 5) The Hong Kong & Shanghai Banking Corp. Ltd 6) The Mauritius Commercial Bank Ltd 7) Maldives Islamic Bank Pvt Ltd 8) Allied Insurance Company of Maldives Pvt. Ltd. 9) Sri Lanka Insurance Corporation Ltd. 10) Amana Takaful (Maldives) Pvt Ltd. 11) Ceylinco Insurance Company Pvt Ltd. 12) Maldives Finance Leasing Company Pvt Ltd 13) Housing Development Finance Corporation Plc. 14) Insurance Agents 15) Insurance Brokers 16) Securities Market Intermediaries

Monetary Policy

Monetary policy has been intended at achieving and maintaining price stability in Maldives, by using an exchange rate peg with the US dollar as the transitional target, in a mode beneficial to balanced and sustainable growth of the state economy. The chief policy instruments at current in use are the Minimum Reserve Requirement (MRR), Central Government Treasury bills (T-bills), Re-purchased (Repo) and Re-discount facilities.

Monetary Measures & Prudential Regulations

The key prudential regulations currently in effect are:

1) All commercial banks operating in the Maldives are required to pay a profit tax of 25 percent, according to Pursuant to Law 9/85 of 27 June 1985.

2) Through result from 20 September 1986, all commercial banks operating in Maldives are required to contain their loan agreements, the provision that re- payments are to be made in the currency in which loan is disbursed.

3) Banks are required to follow the MMA‟s classification criteria in accordance with a the same credit risk grading system or loan asset classification matrix and charge a loan loss provision against all classify loans and advances as per regulations established by the MMA, according to from 25 April 1996.

4) All foreign banks operating in Maldives are essential to obtain MMA‟s approvals on all expenditure and profits repatriation to their head office, according to 31 December 1996.

5) All foreign banks operating in Maldives are required to obtain MMA‟s approvals on all payments and profits repatriation to their head office, according to 31 December 1996.

6) All commercial banks are required to use a standard format of financial statements outlined by the MMA, and to exhibit the annual financial statements in a clear place within the place of company of the bank, according to 3 December 1996.

7) All commercial banks keep and reimbursement account with MMA has been consolidated and computation of MRR has been changed to a weekly average basis, according to 23 March 1997.

8) All commercial banks are required to report their Net foreign currency position to MMA on a daily basis, according to 30 April 1997

9) Banks are required to submit a report on the classification of loans and advances on a quarterly basis, according to 29 October 1997

10) All banks are required to complete the form “Computation of Risk Weighted Assets” and submit it to the MMA on a quarterly basis, according to January 1998,

11) All commercial banks are required to keep a Minimum level of paid-up Capital that is not less than Rufiyaa 30 million, according to 1 January 1998. Half of the MCR has to be deposited with MMA as “capital deposit” bearing interest of 1.5 percent per annum. In addition, all commercial banks have to keep, at all times a capital adequacy ratio not less than 8 percent of risk-weighted assets.

12) The MMA discontinued the foreign exchange purchases and sales services of the Post Office Exchange (POE). Commercial banks were requested to provide these services to general public in a cooperative and sustainable manner, according to 19 July 2000.

13) Banks are required to submit details of foreign currency sales on a daily (next day) basis, according to 10 December 2000.

14) Banks are required to submit their credit position on a daily basis, according to 20 December 2000.

15) Banks are required to look for MMA‟s approval to hire new CEO/GM for their banks, according to 1 January 2001.

16) Banks are required to submit on a every day basis their whole outstanding loans and advances and on a weekly basis, the breakdown of loan collection by major economic groups, according to 5 July 2001.They are also required to present their interest rates, commissions and fees on a weekly basis.

17) Commercial banks are free to decide the annual rate of interest chargeable on loans and advances denominated in US Dollars, according to 24 June 1995.

18) Commercial banks are free to determine the annual rates of interest chargeable on loans and advances and the yearly interest payable on deposits denominated in local currency, according to 15 August 2001.

19) The MMA discontinued publishing the exchange rate for foreign currencies accept for the US dollars; according to 2 October 2005.This was replaced by a system in which all commercial banks were necessary to issue their own exchange rates apart from the US dollar.

20) The MMA started issuing T-bills on behalf of government as a alternate of MMA Certificates of Deposits (CD‟s) with involvement limited to banks and state owned enterprises (SOE‟s) only, according to 10 September 2006.

21) The Minimum Reserve Requirement (MRR) for commercial banks was reduced from 30 percent to 25 percent of the average local and foreign currency demand and time liabilities, without interbank liabilities and L/C margin deposits, according to 1 June 2006. Balances of the minimum reserve deposits in excess of 15 percent bear an interest rate of 2.5 percent per annum. The reserve requirement for local currency has to be meet in the form of Rufiyaa deposits, while for foreign currency, US dollar deposits are required.

22) MMA introduced a Repurchase Facility (Repo) to replace the “Lombard Facility” to provide short-term rufiyaa liquidity to commercial banks operating in the Maldives that are unable to access funds on the interbank market, according to 23 November 2006. Repos are available for terms of one to seven days and the Repo rate is set at a margin above the one month T-bill rate so as to provide sufficient incentive for banks to look first to the interbank market before seeking recourse to the MMA for finances.

23) The MMA introduced Rediscount Facilities to build up a secondary market for T- bill holders. The facility is limited to only T-bill holders, according to 23 November 2006. The discount rate is set at a margin above the T-bill rate, so as to provide enough incentive for bank to look first to the interbank before seeking funds from MMA.

General Information:

Language Divehi is the administrator language, English is also speak

Currency The unit of currency is the Maldivian Rufiyaa (RF) US $ 1= 11,77 rufiyaa (Mid-year 1996)

Local time GMT+5

Working hours Banking hours: From 8h to 13h30. Sunday through Thursday. - Government offices: From 7h30 to 14h30. Sunday through Thursday. - Private offices: Open between 8h and 10h and close between 18h and 20h, with a lunch break in between.

The Maldives Monetary Authority has the single right and capability to issue legal tender notes and coins in Maldives of the Maldives Monetary Authority Act 1981. The Authority is responsible for printing banknotes, minting coins and maintaining an enough stock of banknotes and coins in consistence with the development and steadiness of the economy.

Banking system Maldives Monetary Authority (MMA) is the central bank in Maldives. The Bank supervises and regulates commercial banks and foreign exchange communicating and advises the Government on Banking and Monetary matters.

The banking system is formed by:

Foreign Banks are bank of Ceylon. Habib bank Ltd. and State Bank of India; Commercial bank: Bank of Maldives LTD (BML); Insurance: Allied Insurance Co of the Maldives (Pvt) Ltd.

Foreign exchange system:

There is no exchange power legislation. No difference is made between accounts held by residents and those held by non residents and there is neither restriction on keeping foreign currency balances, nor on costs for unseen.

CUSTOMS TAXATION:

Duty rates in Maldives range as follows:

From 5 percent to 20 percent on daily necessities and essentials; From 10 percent to 25 percent on items important for growth of domestic industries; From 25 percent to 35 percent on things that will improve the economic welfare of the country; From 35 percent to 200 percent on luxury items; Some personal items, medicines, staples, and textbooks are free from import duties. Duties are payable in home currency.

Financial System

Reverse Repurchase (RRP)/Repurchase (RP)

The Maldives Monetary Authority (MMA) conducts Reverse Repurchase and Repurchase Facility with permitted commercial banks in order to direct the Rufiyaa liquidity in the banking system by mopping-up or injecting liquidity. The terms and conditions for the issuance of the Repurchase and Reverse Repurchase facilities are restricted in the Section 2 of the 'MMA Monetary Operations Manual'.

All Reverse Repurchase and Repurchase transactions carried out in terms of 2.3 and 2.4 of the manual are subject to the requirements of the Master Repurchase Agreement.

Reverse Repurchase: Sale of securities by MMA on an auction basis with the agreement to buy them back at a prearranged date at a predetermined price.

Repurchase: Acquisition of securities by MMA on an public sale basis with the agreement to sell them back at a predetermined date at a pre-determined price. Foreign Exchange Swap:

The Maldives Monetary Authority (MMA) conducts FX Swap (Foreign Exchange Swap) with licensed commercial banks. FX Swap is a monetary policy tool to manage foreign currency liquidity in the banking system by mopping up or injecting liquidity. This involves the purchase of or sale of Rufiyaa against foreign currency at an initial date and an agreement to reverse the transaction at a upcoming date at a particular forward rate determined via an auction system. The terms and conditions for the issuance of the sell/buy FX Swap are contained in the Section 3 of the 'MMA Monetary Operations Manual'.

All FX Swap transactions carried out in the FX Swap Operations manual are subject to the provisions of the International Swaps and Derivatives Association Agreement (ISDA).

Buy/Sell FX Swap For absorbing domestic liquidity; purchase spot and sell forward Rufiyaa in opposition to another currency.

Sell/Buy FX Swap To insert domestic liquidity to the market; sell spot and buy forward Rufiyaa.

Overview of Government Securities

The MMA is the Government‟s agent for the issuance and management of Government securities under the Agency Agreement for Cash and Domestic Debt Management dated 30 September 2009. The Authority shall set up and analysis procedures and systems to ensure that the issuance of domestic debt is undertaken efficiently and successfully. The terms and conditions for the issuance of these securities are contained in the Government Securities Operations Manual.

The MMA is also the registrar for all Government securities issued and it operates an electronic book-entry system (BES) for this intention. The rules governing the operation of the BES are enclosed in Section 3 of the Government Securities Operations Manual.

Current Rates (per cent per annum)

GDP rate: 8 % (2010) Expected GDP: 4 %( 2011)

Current inflation rate: 4.7 %( 2010)

. Open Market Operations

Reverse Repurchase Rate (1 Week) 6.98*

. Standing Facilities

Overnight Deposit Rate 0.25

Overnight Lombard Rate 16.00

. Government Treasury Bills

28 Day TBills 6.96*

91 Day TBills 6.97*

182 Day TBills 6.99*

. Commercial Banks

MRF USD

Deposit Rate 2.25 - 6.50 1.25 - 6.50

Lending Rate 8.00 - 13.00 5.50 - 13.00

PART-2 (A) (1) MALDIVES TOURISM

 Tourism in Maldives which was introduced in 1972 has fruitfully developed in the past years. Maldives tourism has been rapidly growing the number of tourist arrivals and resorts islands over the last ten year period.

 On the European market, Maldives today rank among the most attractive travel destinations in the tropics. Maldives offers large natural resources for tourism and encourages eco-tourism to protect the sensitive environment and underwater life.

 Beach tourists are attracted by the nature of the beaches and the climatic conditions as well. The country‟s environment really guarantees relaxation and recreation. (2)

(3)

(4)

(5)

Tourism is the major contributing industry in the Maldives, as it plays a vital role in earning foreign exchange revenues and creates opportunity for the employees and also tertiary sector of the country. Maldives is the main source of attraction to many tourists visiting the country worldwide.

History:

Tourism began in the Maldives in the late 1900's. During 1960s A United Nations mission did not recommend tourism, because of islands were not suitable. After the launch of the first resort in Maldives in 1972, however, tourism in Maldives has to be bloomed.

The arrival of the first tourist group is estimated to have occurred in February 1972. The group landed at Male, the capital island of the Maldives, and spent 12 days in the country. Tourism in Maldives started with just two resorts with a capacity of about 280 beds in Kurumba Township and Bandos. Curretnly, there are over 80 resorts situated in the different atolls constituting the Republic of Maldives. Over the past few decades, the number of tourists in Maldives has risen endlessly. Today, more than 500,000 tourists visit the Maldives.

(6) NATURAL BEAUTY:

 Maldives is very popular for its natural beauty which includes the blue ocean and white beaches, accompanied by clean air and fresh temperatures. The atmosphere of the Maldives is supreme for visitors to get engaged in water sports such as swimming, fishing, scuba diving, snorkeling, water-skiing and windsurfing.  Due to its amazing underwater landscape and clean water, Maldives is ranked in the midst of the best fun diving destinations of the world.

(7) ECOTOURISM IN MALDIVES:

 Some endorsement of ecotourism is practiced in the Maldives, with resorts emphasizing recycling of heat that is wasted in producing electricity and strick policies of waste disposal.Furthermore, the government aims to protect the natural beauty of the islands before they are being change into resorts by enforcing laws such as prohibition of catching turtles and reduction in the damages caused to the coral reefs.

 Although laws exist that prohibit this practice in the Maldives, these laws are not respected or enforced by the local authorities.

Major Functions of Tourism Department:

Functions Formulation and implementation of development policy Long-term planning of tourism development at national level Coordination of development implementation Formulation and implementation of laws and regulations for tourism Establishment and administration of facility and service standards Adoption of sound environmental principles in tourism development and operation Statistical collection, compilation and reporting Conducting of research studies Planning and implementation of human resource development for tourism Establishment and administration of training standards, in coordination with the concerned authorities. Leasing of land for tourism and registration of all tourism operators and facilities.

Roles of Tourism Sector:

 In recent years, Maldives has successfully marketed its natural assets for tourism--beautiful, unpolluted beaches on small coral islands, diving in blue waters abundant with tropical fish, and glorious sunsets.  Tourism now brings in about $600 million a year. Tourism and related services contributed 29% of GDP in 2010. But its indirect contribution is much higher.  As a result, tourism is the catalyst for growth. Since the first resort was established in 1972, more than 95 islands have been developed, with a total capacity of some 23,600 beds.  Maldives has embarked on an ambitious tourism expansion plan; several resorts are under construction. However, resort expansion has not been planned very well.  There is a excess of hotel rooms and several half-built resorts. Over 790,000 tourists (mainly from Europe) visited Maldives in 2010.  The average occupancy rate is about 70%. Maldives had experienced capacity utilization rates of over 80%--reaching over 95% in the peak winter tourist season--prior to the new resort drive that began in 2008. Average tourist stay is 8 days.

(8) THE MALDIVES HONEYMOON

 Celebrate your special honeymoon in Maldives at the most beautiful and romantic islands of Maldives.

 You can enjoy the privacy and relationship of a isolated, natural setting and a warm inviting atmosphere, where the sunsets are wonderful!

 The Maldives resorts offer you not only the crystal clear waters and azure blue lagoons, food is tasty and services are excellent.

 Almost all Maldives resorts offers honeymooners fruit plates and flower decorated rooms on the arrival night – a romantic promise of what lays ahead. On request, resorts also arrange romantic candle-lit dinners on the beach and also champagne breakfast served in the privacy of your own room, to make your honeymoon holiday memories that will last a lifetime!

Structure of the Industry: Maldives' accommodation capacity has grown rapidly in recent years to 87 island resorts; 8 hotels and 28 guest inns primarily in Male; and 113 safari vessels, with a total of about 20,000 beds.

Many resorts are quite small (20-60 units); about 30 have 100 or more rooms, and there are a few large operations of between 200 and 400 rooms. Eleven new resorts (1,600 beds) were approved early in 2004, which will press on the total number of beds over 21,000. Permission to build resorts is given by the Ministry of Tourism through a leasing system. Most lessee/owners are Maldivians and the industry remains largely in Maldivian hands, although well-known foreign hotels (e.g., Four Seasons, Hilton) are beginning to open up in Maldives.

MALDIVES ADOPTS NEW TOURISM SLOGAN AND LOGO

 The Maldives Marketing and PR Corporation (MMPRC) today discovered the country‟s new tourism slogan and logo, after over a year-long consultation and design process, involving industry and government.

 The new slogan is ‘Maldives – Always Natural’, which is accompanied by a logo prominence the country‟s unique natural characteristics.

 “The slogan and logo are designed to highlight the outstanding natural beauty of the Maldives, which tourists from all segments of the market consistently rate as one of their main reasons for visiting the country,” said MMPRC Chairperson Thoyyib Mohamed.

 The slogan and logo‟s environmental theme is also designed to support the Maldives‟ fishing industry: sustainable, pole and line caught tuna is the country‟s second biggest export, after tourism.

 The slogan and logo were formally approved during cabinet meeting, which was chaired by President Nasheed.

 “The previous slogan was over 11 years old and we believe the new slogan and logo better represents the Maldives of today, as well as tomorrow,” said Simon Hawkins, Managing Director of the MMPRC.

 The MMPRC commissioned an open tender for a private company to investigate research, design and create the slogan and logo. This tender was won by „QUO KEEN‟ of Bangkok and London.

 David Keen, CEO of QUO KEEN said: “'We have created a brand that stands for the Maldivian people, for tourism and for all of industry.

(B)

 After fishing, two other industries play a very crucial role when it comes to the economy of Maldives, as well as Maldives Trade, Maldives Exports, Maldives Imports. These include agriculture and manufacturing but with limited availability due to shortage of good land for growing crops and enough domestic worker, the country of Maldives has needed to depend on many of the attach foods consumed to be imported.

 The most recent reports about Maldives trade shows that for Maldives exports, both fish and clothing are the top two commodities with an estimation of $123 million. The current partners for Maldives exports include the United States, the United Kingdom, Sri Lanka, Japan, Thailand, and Algeria.

 For Maldives imports, this involves a variety of commodities such as ships, foods, petroleum products, clothing, textiles, capital goods, and intermediate goods. The estimated value of more than $550 million involves Singapore, Japan, Sri Lanka, India, and Canada.

 The Maldives has an open economy with a narrow export base, the country is heavily import oriented for most of its economic activities. As a result, foreign merchandise trade normally records a large deficit. Imports have averaged around two thirds of GDP in the last 5 years, and domestic exports, consisting primarily of fish and fish products have ranged between 10 to 15 percent of GDP.

Imports: As the Maldives' economy is heavily import-oriented, the country imports virtually everything such as petroleum products, intermediate and capital goods, foodstuffs, textiles, clothing, etc.

Import partners: Singapore 23%, UAE 19%, India 11%, Malaysia 9%, Sri Lanka 7%.

Exports: Frozen, fresh and processed fish and other marine products.

Export partners: Thailand 22%, Japan 22%, UK 14%, Sri Lanka 15%, Germany 5%.

Exchange rate: Maldivian Rufiyaa is pegged to the US dollar at USD 1.00 = Rf 12.80 (mid rate)

Import Duty: Maldives uses import duties as its main source of tax revenue. At present, tariffs are levied on all imports, except on items brought by passengers for personal use, in non commercial quantities.

Import duty is levied on the CIF (Cost + Insurance + Freight) value of the goods.  After tourism, fish is still an important industry for Maldives. Thanks to the 1989 reform, quotas for Maldives imports were lifted, which meant the private sector can benefit from some of the Maldives exports available. This reform also helped create more flexible regulations whereby foreign investment could participate more in the overall Maldives trade market.

 Global exports in 2008 by Maldives Trade Value (thousands) are 1,225 and share (%) is 1.07 and growth in (%5year) is 157.70.

Maldives registers a 3.3 percent growth in tourist arrivals in the first quarter of 2012

Overall arrivals:  A total of 255,867 tourist arrivals were registered from January to March 2012. This is an increase of 3.3 percent compared to the same period in 2011.

 Central and Eastern Europe recorded a growth of 15.7 percent, Western Europe registered 10 percent, East Mediterranean Europe recorded 30.6 percent, North East Asia 12.8 percent, South East Asia 12.1 percent, Oceania 26.2 percent, Americas 8.8 percent, and Middle East 77.8 percent.

 However, Southern Europe the centre of European Economic crisis recorded a negative growth of -24.9 percent. Northern Europe also recorded -9.2 percent mainly due to economic downturn in the UK.

Maldives Business:

 Maldives is a fast developing country. The government of Maldives is taking major steps to put the country on the rise of economic growth and development. Maldives business activities have played a major role in the economic development of the country.

 Most of the people of the country have an import and export business. Maldives imports practically everything, and business opportunities in the country which includes petroleum products, shipping goods, textiles, capital goods and food items.

 The country exports seafood and clothing. Sine trading is a major activity of the country; Maldives has trade relations with a large number of countries, which include Germany, India, Japan, Bahrain, Singapore, Malaysia, Thailand, United Arab Emirates, United Kingdom and the United States of America.

 Tourism is a major industry of the country. One can find many resorts and hotels in the country where tourists come for a holiday throughout the year. Tourism is major source of foreign exchange for the country.

 Fisheries are also a major industry of the country. Fishing is the occupation of most of the people of the country. The government has taken a number of steps to develop this sector. Other industries that one can find in Maldives include printing, brick making, garment manufacturing, marine engine repairs, and manufacture of PVC pipes.

 Male is the main center for all business activities of the country. There are certain businesses etiquettes that one needs to follow in Maldives. Most of the business activity takes place in the morning. One has to make preceding appointment with person with whom one wants to meet.

 The meeting atmosphere is generally informal. One must be well dressed when going for such business meetings. Men are supposed to wear shirts and trousers while women are expected to wear lightweight suits. Handshaking is the most common form of greeting a person in these meetings.

Maldives business activities have experienced a surge due to the economic reforms and new policies introduced by the government.

Maldives 1,000,000.00 800,000.00 600,000.00 400,000.00

200,000.00 Number ofArrivals Number 0.00 2002 2003 2004 2005 2006 2007 2008 2009 2010 year

International tourism, number of arrivals

(C)

 In fact, for Maldives trade, tourism is the chief industry, contributing for close to 30% of the country‟s GDP. In addition, tourism currently accounts for approximately 60% of all foreign exchange receipts. In the 1990s alone, tourism in Maldives reached a colossal 115%. Some time ago 90% of tax revenue for the government was associated with duties for Maldives imports, as well as tax discounts connected to this industry.

 In trying to pull the people of Maldives together, serious effort has gone into developing a strong infrastructure, which depends heavily on tourism, as well as a number of complementary sectors to include real estate, construction, transport, government, and distribution.

Notice by Ministry of Tourism, Arts & Culture regarding Accommodation facilities

 In the Maldives, a visitor can find different types of accommodation to meet the choice of the visitors. Tourist accepting facilities in the Maldives are mainly based in Tourist Resorts and other accommodation facilities are hotels, guesthouses, safari vessels and marinas. All Tourist accommodation facilities are registered in the Ministry of Tourism, Arts and Culture.

 All Tourists should stay in a facility registered to accommodate tourists. These facilities should have their operating license displayed at the reception / public area.

 All visitors should choose accommodation facilities that are registered to accommodate tourists. This is to promise visitors that they are utilizing the services of a duly registered establishment.

Taxation.

 Maldives has a simplified tax system that has no income tax, property tax, sales tax or VAT, and no taxes on exports-with the exception of tourism, an invisible export, which is quite highly taxed. There are four taxes that affect tourism: (i) the $8 bed night tax, representing 14 percent of total current government income; (ii) the $10 airport tax, 2.4 percent of revenue; (iii) resort land leases, representing 20 percent of revenue; and (iv) import duties, estimated at 16 percent of total revenues from tourism.

 Core tourism revenues account for about half of total government revenue. Tourism taxes are therefore an important support of government revenue mobilization. For 2004, the total government revenue budget was MRf 3.2 billion; of this, tourism related revenue accounted for about MRf 1.8 billion, or 56 percent.

 On the other hand, public expenditure on tourism is about 1 percent of total revenues, and this was a mindful decision when it was decided that resorts would give their own infrastructure.

 This could be used for opening up new areas, developing poles in the north and south, and training and destination marketing in tourism, for example. It could also be used to achieve the government's redistribution objectives, including public transport, northern and southern development poles, creating SMEs, and enhancing linkages.

 In fact, for Maldives trade, tourism is the primary industry, accounting for close to 30% of the country‟s GDP. In addition, tourism currently accounts for approximately 60% of all foreign exchange receipts. In the 1990s alone, tourism in Maldives reached an enormous 115%. At that time, some 90% of tax revenue for the government was associated with duties for Maldives imports, as well as tax discounts connected to this industry.

Import/Export Licenses: Imports/Exports of goods in commercial quantities require an Import/Export Trade License issued by the Ministry of Economic Development and Trade, Maldives. The Ministry issues temporary license for infrequent importers.

Temporary Imports through Customs: Upon demand, Maldives Customs allows the brief import of goods and equipments for specific purposes such as trade help, scientific research and other professional use. Such imports are allowed for a period of 14 days, after which import duty is required to be paid.

Export Tax: No export duties or taxes are levied on exports except on export of ambergris.

VI. MALDIVES: TRADE PROFILE

(1) FOREIGN TRADE IN FIGURES

 The Maldives, which consists of 1200 islands, are in a situation of profitable dependence. The truth that the country has little in terms of its own property of raw materials makes it very dependent on oil and finished products. Hence, Maldives imports much more than it exports, which creates a trade scarcity.

 The state budget is heavily dependent on the income from import civil rights. Therefore, customs duties are relatively high. However, as part of its trade policy frame, the government has removed quotas from most of the products and customs measures have been simplified (obtaining an import license has become practically automatic). Moreover, although the State Trading Organization (STO) is still the largest importer, the government is now trying to bring in more private players.

The main clients are Thailand, Sri Lanka, France, the UK, Italy and Tanzania. Singapore and the UAE together share 40% of the country's imports.

VII. TOURISM NOT HIT, BUT WORRIES FOR INDIAN INVESTMENTS:

 The political muddle in Maldives has not affected the tourism industry that brings in most of its revenue but as the crisis continues, questions are being raised on the future of Indian investments in the island nations that have increased exponentially over the past three years.

 By most accounts, there has been no perceivable drop in the tourists that spend time on the 100 resorts extend across the nation of different islands. The tourists, most of them in the high end bracket given the nature of luxury resorts that have cropped up here, infrequently visited the capital city of Male where the political upheaval took place.

 In fact, most proceed directly to their resorts from the airport that is located on an island nearby to the capital city of Male. Officials running the airport say that there have been no flight cancellations and the number of tourists is similar to that observed in the past.

 Many tourists who landed here on Sunday said that they were aware of the political situation in Male but were confident about not calling off their visit as there were no reports of carnage. “We researched and found that the tourism industry is no affect by what is a political problem. There were not many reports of fighting either so I decided not to change the travel plans,” Thomas Kirsch, a tourist from Germany said.

 Insiders in the tourism trade also said that while there were many inquiries from tourists about the situation in Maldives, there were hardly any cancellations. One of the reasons, sources said, was that resorts were not offering refunds and the high costs deterred tourists from canceling.

 While in the short term there is no visible impact on the Maldivian economy, there are worries about Indian investments in the nation that have increased by leaps and bounds over the past few years. From $90 million in 2009, investments from India have crossed the $450 million mark last year.

 The biggest investment has been by the GMR group that has been given the contract to build and operate the international airport. One of the recent triggers of the movement against Nasheed was on his decision to award the contract to GMR.

VIII. TOUR AGENTS FEAR DIP IN TRAVEL TO MALDIVES

 The news of political turbulence in the Maldives has caused anxiety among Indian travelers and tour operators, in near future likely to see tour cancellations.

 The archipelago's capital Male is connected to India by a day by day flight. It is regulated by Air India from Thiruvananthapuram. "As of now, we have received no requests from the Indian government to operate additional flights for migration," said an Air India official.

 With only one flight connecting the two countries, holidays to this destination are booked months in advance, said Iqbal Mulla, president, Travel Agents' Association of India, adding that the tourism industry is expecting drastic cancellations in the coming days? He added that Maldives is not a destination for the middle-class tourist, it attracts a niche host.

 The president of Maldives resigned on February 7, 2012 Tuesday after a police mutiny following three weeks of political upheaval in the popular tourist destination. Early Tuesday, rebel police officers joined anti-government protests that have rocked the capital Male for the past three weeks. There were reports of irregular clashes between the two warring factions.

 "Any political instability or natural disaster affects the tourism industry first. No one would want to stay restricted in their hotel room during a vacation and so people oft for the safer alternative and cancel bookings," Mulla added. The Indian government has not issued any travel advisory yet in this regard. Industry insiders also said that the Maldives' tourism industry may get a geological advantage.

 "Tourists beginning to its atolls and hardly stay in its capital Male. It is likely that the atolls are insulated from the tension in the capital. It all depends on news coming from that country. Last year, tourists did not avoid the Greek islands though Athens was in economic chaos and there was rioting on the streets," said a travel agent. Not together from tourists, a number of Indian traders and businessmen travel to these islands often.

IX. POLITICAL CRISIS THREATENS TOURISM IN MALDIVES

 The political crisis and unrest has sparked fear among the tourism leaders in Maldives. The latest development in Maldives has scared tourists who are consistently calling resorts to cancel their booking.

 Tourism plays very major role in economy of Maldives. The island famed for interesting beaches and luxury resorts is very popular wedding and honeymoon destination. Tourism contributes around 60 per cent of foreign currency earnings. However things have changed quite dramatically in past few days.

 This latest development has lead to panic among the tourists who are cancelling their trips to Maldives. Travel Agents Association of India has told that several tourists have cancelled the trip and association expects fewer bookings for the busy Valentine‟s Day period.

 Tourism industry in Maldives is also taking event as major setback that could not have come at any worse time. Valentine‟s Day period is a peak tourist season in Maldives. Honeymooners and romantic couples flock to Maldives for some private time.

 Britain has added to the troubles of Maldives tourism by issuing travel advisory for capital city of Male. According to tourism experts this will lead to more panic and cancellations. Maldives Association of Travel Agents is trying to assure tourists of safety in the country.

 The association has issued statement saying that hotels and resorts are fully prepared. Tourists are directly taken from International airport to outlying resort destinations. They won't have to set a foot in Male, which is the center of political crisis.

 Despite the assurances, tourists are giving Maldives a miss. The tour operator association believes that most affected market would be India because political situation in Maldives is making headlines in India. This would lead to fear and panic among Indian tourists.

General Import Restrictions:

The following items are not acceptable for carriage to any international destinations unless otherwise indicated. (Additional limits may apply depending on destination. Various regulatory clearances in addition to customs clearance may be required for certain commodities, thereby extending the transit time.)

1. APO/FPO addresses.

2. C.O.D. shipments.

3. Human corpses, human organs or body parts, human and animal embryos, or cremated or disinterred human remains.

4. Explosives (Class 1.4 explosives are acceptable for carriage to Canada, Germany, France, Japan, United Arab Emirates and United Kingdom. Note: United Arab Emirates only allows Class 1.4 explosives to be shipped hold-for-pickup to the FedEx Express facility in Dubai).

5. Firearms, weaponry and their parts (acceptable between the U.S. and Puerto Rico).

6. Perishable foodstuffs and foods and beverages requiring refrigeration or other environmental control.

7. Live animals including insects, except as provided in the Live Animals section in the FedEx Service Guide. Plants and plant material, including cut flowers (cut flowers are acceptable from the U.S. to selected points in Canada and from Colombia, Ecuador and the Netherlands to the U.S.).

8. Lottery tickets and gambling devices where prohibited by law.

9. Money (coins, cash, currency, paper money and negotiable instruments equivalent to cash such as endorsed stocks, bonds and cash letters).

10. Pornographic and/or obscene material.

11. Shipments being processed under:

a. Duty drawbacks claim unless advance arrangements are made. b. Temporary Import Bonds – acceptable under the FedEx International agent Select option, for initial import only. c. U.S. State Department licenses d. Carnets e. U.S. Drug Enforcement Administration export permit. f. Letters of Credit. Shipments subject to Letters of Credit are generally prohibited, with the exception of shipments subject to Letters of Credit calling for a “courier receipt”, as defined by Article 25 of UCP 600, shipped using the FedEx Expanded Service International Air Waybill. g. Certificate of Registration shipments (CF4455).

12. Unsafe waste, including, but not limited to, used hypodermic needles or syringes or other medical waste.

13. Shipments that may cause damage to, or delay of, equipment, personnel or other shipments.

14. Shipments that require us to obtain any special licenses or permit for transportation, importation or exportation.

15. Shipments or commodities whose carriage, importation or exportation is prohibited by any law, statute or regulation.

16. Dangerous goods except as permitted under the Dangerous Goods section of these terms and conditions.

17. Processed or unprocessed dead animals, including insects and pets. Taxidermy-finished hunting trophies or completely processed (dried) specimens of whole animals or parts of animals are acceptable for shipment into the U.S.

18. Packages that are wet, leaking or emit an odor of any kind.

19. Wildlife products that require U.S. Fish and Wildlife Service export clearance by FedEx prior to exportation from the U.S.

(D)

(1) MALDIVES PARTICIPATES IN SATTE IN NEW DELHI

 The Maldives Marketing and PR Corporation together with Maldives tourism industry has participated in SATTE (South Asia‟s Leading B2B Travel & Tourism Event), India's leading B2B travel & tourism event, held in New Delhi at Pragati Maidan from 10-12 February 2012.

 Maldives representation at SATTE was significant as this bring together travel agents, tour operators, hotels and resorts, domestic and international airlines, NTOs, state tourism boards, wholesalers and other travel-related products and services from across India and the world, on a single platform.  Hence Indian market being one of the main focuses in this region this would be one of the ideal platforms to present our offers while interacting with Tour operators, travel agents and other visitors.  SATTE has got excited sharing of 600 companies from 38 countries including Switzerland, Spain, Britain, Poland, Hungary, Malaysia, Iceland, Thailand and Turkey this year. All these legislative body set up their stalls in the 6,000 square meters of exhibition space.

 During this year, 22 representatives from 12 different companies and 2 officials of Maldives Marketing and PR Corporation represented the Maldives delegation included representation from some of the premium hotel brand as well as Tour Operators and Travel Agencies of the Maldives

 At the end of 2011 India attracted 30,978 tourists to the Maldives which was a 20.3 per cent growth compared to the figure at the end of 2010.

 Foreign Investment Services Bureau (FISB) is the government's agency engaged in promoting, licensing and registering foreign investments in the country. The process of registering a foreign investment is effortless and basic. Prospective investors can expect to get their operations under way within 10 days from the day that all the required documentation is submitted to FISB.

 Some incentives offered to foreign investors in the Maldives are: No income tax, corporate tax or property tax in the Maldives Legally backed investment guarantee Long term contractual agreements and long term lease of land Freedom to use foreign managerial, technical and unskilled workers No borders on the repatriations of earnings or profits

Maldives Business - Investment opportunities

 Foreign investors are on hand a transparent policy environment. The law on foreign investments (Law 25/79) guarantees the security of investments. In addition our liberal trade environment, dynamic private sector and development- oriented legal structure all contribute to a conducive climate for trade and investment.

 The Maldives has a strong record of political stability resulting from homogenous nature of our society with one culture, one religion and one language. Thus the ethnic and political unrest that can disrupt economic activities elsewhere are non- existent in the Maldives.

 The country is an income tax and corporate tax place of protection. The huge untapped potential in natural marine recourses and the young, energetic and trainable workforce are strong inducements to invest in the Maldives, as has been proven by many successful foreign investors.

 The number of foreign companies investing in the Maldives has been increasing every year. Their services range from management and accounting services, air transport, resort management to manufacturing.

 The Maldives will continue to attract and promote foreign investment in to the country. There will be an emphasis on promotion of investment activities that:- a) Are Capital intensive b) Enhance transfer of technology c) Introduce new skills d) Are Environmentally friendly

 Investment potentials range from investment united with the tourism industry, such as development of air and sea transport or direct investment in tourism itself and marine based industries such as reef fish processing, aquaculture/marine culture and production of value-added fish and marine based products. The sectors where potential exists are: Fisheries sector Financial sector Transport and other services sectors Infrastructure development

 The Foreign Investment Service Bureau of the Maldives invites you to explore the fabulous potential in the development of marine based industries, development of infrastructure such as harbors, tourist resorts, transport services and many other activities.

 The service sector in the Maldives could be second enhanced and there is sufficient scope for foreigners in this sector. Banking, accounting, management consultancy are some of the areas where we could use foreign investment and skill.

 Scope for the development of housing islands for foreigners and development of accommodation on time sharing schemes. Interested parties may apply to FISB and islands could be allocated for such developments.

 There is also potential for development in aqua culture, in particular seafood and fish farming and the cultivation of seaweed, lobster, shrimp, reef fish and edible crabs.

 Foreign Investors may have a demand either of the following business arrangements when investing in the Maldives:

1. Joint ventures with local partners 2. Wholly owned foreign investments.

Conclusion

 The government has leased 15 islands to MTDC for resort development. 9 of these 15 have been identified and leased to MTDC already, while the remaining 6 and the schemes through which they will be handed to the company are as yet to be announced.

 8 of the 9 islands already leased are under development. Herathera, the remaining island, has already commenced operation. Work is currently underway to develop Uligamu as a 100-bed resort. Owing to the constraints formed by 2009‟s global credit downturn, much of the initial planning has had to be revised, although the strategies we have set in place still stay behind intact.

 Each of the 9 leased islands is sole not only in size, shape, natural features, and beauty but also in terms of development.

 The country exports seafood and clothing Maldives is very popular for its natural beauty which includes the blue ocean and white beaches, accompanied by clean air and fresh temperatures. Male is the main center for all business activities of the country.

 The news of political turbulence in the Maldives has caused apprehension among Indian travelers and tour operators, with the coming days likely to see tour cancellations.

 Tourism now brings in about $600 million a year. Tourism and allied services contributed 29% of GDP in 2010.

Bibliography

WEB-LINKS 1. www.wikkipedia.org 2. WWW.MMPRC.COM 3. www.tourism.gov.mv 4. www.maldivestourism.net

REPORT:

1. THE MALDIVES

Sustaining Growth & Improving the Investment Climate April, 2006 Finance and Private Sector Development Unit South Asia Region

The World Bank

2. MALDIVES Diagnostic trade integration study, November 2006

―GEOGRAPHICAL AND ENVIRONMENATAL ISSUES AND BUSINESS OPPORTUNITIES IN MALDIVES‖ X. TABLE OF CONTENT

XI. SR. NO XII. PARTICULARS XIII. PAGE NO.

XIV. XV. EXECUTIVE SUMMARY XVI.

XVII. XIX. PART – I ECONOMIC OVERVIEW OF MALDIVES

XVIII.

XX. 1 XXII. Demographic Profile of the Country

XXI.

XXIII. XXV. Economic Overview of the Country

XXIV.

XXVI. XXVIII. Overview of Industries Trade and Commerce

XXVII.

XXIX. XXX. Overview Different economic sectors of selected country

XXXI. XXXII. Overviews of Business and Trade at International Level

XXXIII. XXXIV. Present Trade Relations and Business Volume of different products with India / Gujarat

XXXV. XXXVI. PESTEL Analysis

XXXVII. XXXVIII. PART – II INDUSTRY / SECTOR / COMPANY SPECIFIC STUDY

XXXIX. 2 XL. Introduction of the selected Company / Industry / Sector and its role in the economy of specified country.

XLI. XLII. Structure, Functions and Business Activities of selected Industry / Sector / Company

XLIII. XLIV. Comparative Position of selected Industry / Sector / Specific Company / Product with India and Gujarat

XLV. XLVI. Present Position and Trend of Business (import / export) with India / Gujarat during last 3 to 5 years

XLVII. XLVIII. Policies and Norms of selected country for selected Industry/company for import / export including licensing / permission, taxation etc

XLIX. L. Policies and Norms of India for Import or export to the selected country including licensing / permission, taxation etc

LI. LII. Present Trade barriers for import / Export of selected goods(if any)

LIII. 3 LIV. Potential for import / export in India / Gujarat Market

LV. LVI. Business Opportunities in future

LVII. LVIII. Conclusions and Suggestions

LIX. LX. Bibliography

List of Tables

S.R.NO PARTICULARS PAGE NO. 1 Maldives, trade with the world 2 Bilateral trade figures 3 Import Documents 4 Radio information

List of Figures

S.R.No Particulars Page No. 1 National Flag Of Maldives 2 Tourism Industry 3 Fishing Industry 4 Transport Sector 5 Nordic Intralogistics 6 Shipping Industry 7 MV AMET Majesty

LIST OF ABBREVIATIONS

Abbreviations Full Forms EEZ Economic Exclusive Zone GOI Government Of India EDI Electronic Data Interchange GoM Government of Maldives EC European Commission LDC Least Developed Countries SAFTA South Asian Free Trade Agreement PVC Poly Vinyl Chloride NAMA Non Agricultural Market Access CMDA Capital Markets Development Authority

PART 1

GEOGRAPHICAL

AND ENVIRONMENATAL ISSUES IN MALDIVES

Demographic Profile of the Maldives

The republic of Maldives is located on the equator, south of India. It is the smallest country in Asia, and is about one-and-a-half times the size of Washington, D.C. Maldives has nineteen atoll, or administrative divisions.

Population: The population of Maldives islands is 294,000. A census has been recorded since 1905, which shows that the population of the country remained to around 100,000 for the following sixty years. Following independence in 1965, the rate of population growth rose due to improvisation of health. The population has doubled by 1978, and the population growth rate peaked at 3.4% in 1985. At the end of 2006 census, the population had reached 298,968, although the census in 2000 showed that the population growth rate had declined to 1.9%. Life expectancy at birth stood at 46 years in 1978, and later rose to 72.

Maldives has no territories or dependencies. The capital of Maldives is male and has a population of 83,000 people. Area: The area of Maldives is 298 square kilometers (115 square miles). Language: The main language of Maldives is Maldivian Dhivehi, and English. Religion: The main religion of Maldives is Sunni Muslim.

The island nation of Maldives is located near south of India in the Indian Ocean. The islands are small, and none rise more than 1.8 meters and6 feet above sea level. Like necklaces draped along an undersea plateau, 1,200 coral islands—about 200 inhabited—form the Maldives.

Islam is the official religion of the Maldives and open practice of any other religion is forbidden and liable to prosecution.

GDP per Capita: The Gross Domestic Product of Maldives is U.S. $3,900 Literacy Percent: The literacy rate of Maldives is 97%.

Longest distances: The coverage area of Maldives is 823 kilometers (510 miles) from north to south; 133 kilometers (82 miles) from east to west.

The National Flag of Maldives looks like as it is given in right hand side. Economic Overview of the Maldives

In the Economy of Maldives, the main contribution towards the GDP comes from the main three industrial sectors and they are mentioned below

Industry: Fish processing, tourism, shipping, boat building, coconut processing

Agriculture: Coconuts, corn, sweet potatoes; fish

Exports: Fish, clothing

(i) Tourism

Tourism accounts for 28% of GDP and more than 60% of the Maldives' foreign exchange receipts. Over 90% of government tax revenue comes from import duties and tourism-related taxes.

According to the Ministry of Tourism, the emergence of tourism in 1972 has transformed the economy, moving rapidly from dependence on fisheries to tourism. In just three and a half decades, the industry became the main source of income for the country. Tourism was also the country's biggest foreign currency earner and the single largest contributor to the GDP.

(ii) Fishing industry

For many centuries the Maldivian economy was entirely dependent on fishing and other marine products. Fishing remains the main occupation of the people and the government gives priority to the fisheries sector.

As of 2010, fisheries contributed over 15% of the country's GDP and engaged about 30% of the country's work force. Fisheries were also the second-largest foreign exchange earner after tourism.

(iii) Fishing industry

As of 2010, fisheries contributed over 15% of the country's GDP and engaged about 30% of the country's work force. Fisheries were also the second-largest foreign exchange earner after tourism.

(iv) Agriculture and cottage industries

Agriculture and manufacturing continue to play a lesser role in the economy, constrained by the limited availability of cultivable land and the shortage of domestic labor. Most staple foods must be imported. Industry, which consists mainly of garment production, boat building, and handicrafts, accounts for about 7% of GDP.

General overview of Trade and Commerce

The Commerce and Trade Section of the High Commission is accountable for monitoring and reporting on the economies of Sri Lanka and the Maldives for the Maldivian Government and private sector use, and for supporting Maldivian exporters and investors in Sri Lanka and the Maldives.

The country‘s lack of land based natural and mineral resources means that virtually all economic production is highly dependent on imports, creating a heavy dependence on foreign exchange earnings. Intensive agricultural production is limited because of the hypercalcic [ ]soil.

Despite its natural disadvantages, the country has achieved sound growth over the past Two decades, mainly through the development of its tourism and fishing industries. Tourism has grown significantly (from 195000 arrivals in 1990 to 617000 in 2004) and currently accounts for 33% of GDP, a quarter of total employment and more than 60% of the Maldives' foreign exchange receipts.

Fisheries are the key activity outside of Male‘ and the tourist islands it employs 19% of the country‘s labor force but accounts for only 6% of its GDP. Fisheries exports are mostly canned and fresh tuna, which is the second largest source of foreign exchange for the country.

Maldives, trade with the world

Year Imports Yearly Exports Yearly Balance Imports % % + change change Exports

2000 420 82 -338 502

2001 436 3.9 85 4.2 -351 522

2002 412 -5.6 96 12.6 -316 508

2003 415 0.7 100 3.9 -315 514

2004 517 24.8 99 -0.9 -419 616

Average annual 4.4 5.4 0.924 4.9 -3.478 5.3 growth

The Maldives was graduated from LDC (Least developed country) status by the United Nations in December 2004.With a three-year grace period ending in November 2007. Because of the short- to-medium-term losses caused by the tsunami, the United Nations decided on 30 November. Prior to the tsunami, the overall economy of the Maldives demonstrated an quicken growth rate with an increase in real GDP of 9% in 2004, fuelled by strong growth in the tourism, fisheries and construction sectors. This trend was expected to continue. After the tsunami, the World Bank estimated the damage caused at approximately 62% of GDP, with tourism, fisheries and transport infrastructure being worst hit. Details about various companies and industries of Maldives:  Maldives National Chamber of Commerce and Industries  State Trading Organization (STO)  State Electric Company (STELCO)  Maldives Transport and Contracting Co. (MTCC)  Maldives Airports Company  Maldives Post Limited  Dhivehi Raajjeyge Gulhun Pvt. Ltd (DHIRAAGU)  Hulhumalé Development Corporation – HDC  Allied Insurance Company  Bank of Maldives  Housing Development Finance Corporation Limited  Maldives Tourism Development Corporation Limited  Maldives Ports Authority  Maldives National Shipping Limited  Island Aviation Services Limited  Mal’e Water and Sewerage Company Private Limited With graduation from LDC status, the Maldives may experience a loss of ‗potential‘, since future export development diversification could be constrained by a lack of LDC preferences. The EC has supported the Maldivian Government through a capacity building project to develop its trade policy and to increase its technical expertise to secure its position in WTO negotiations.

On regional trade, the GoM has successfully negotiated a continuation of their LDC status under the South Asian Free Trade Agreement (SAFTA). This will ensure that the Maldives continues to benefit from special access to the other members‘ markets and from compensation of lost government revenue resulting from trade liberalization.

Overview Different economic sectors of Maldives

The main industries of Maldives are fishing, tourism, shipping and commerce. The proportion of contribution by the sectors activities to the GDP distribution is (19.1 %), Tourism (17.8 %), fisheries (11.8 %), Construction (9.1 %) and Government administration (9.0 %). The mixed economy of the Maldives is based on the principal activities of tourism, fishing and shipping.

Tourism is the largest industry in the Maldives, accounting for 20% of GDP and more than 60% of the Maldives' foreign exchange receipts. It powered the current GDP per capita to expand 265% in the 1980s and a further 115% in the 1990s. Over 90% of government tax revenue flows in from import duties and tourism-related taxes.

 Fishing is the second leading sector in the Maldives. The economic reform program by the government in 1989 lifted import quotas and opened some exports to the private sector. Subsequently, it has liberalized regulations to allow more foreign investment.  Agriculture and manufacturing play a minor role in the economy, constrained by the limited availability of cultivable land and shortage of domestic labor. Most staple foods are imported.  Industry in the Maldives consists mainly of garment production, boat building, and handicrafts. It accounts for about 18% of GDP. Maldivian authorities are concerned about the impact of erosion and possible global warming in the low-lying country. Development of the infrastructure is mainly dependent on the tourism industry and its complementary tertiary sectors transport, distribution, real estate, construction, and government. Taxes on the tourist industry have been plowed into infrastructure and it is used to improve technology in the agricultural sector.

 Agriculture: Poor soil and scarce arable land have historically limited agriculture to a few subsistence crops, such as coconut, banana, breadfruit, papayas, mangoes, taro, betel, chilies, sweet potatoes, and onions. Almost all food, including staples, has to be imported. Agriculture provides about 2% of GDP.  Manufacturing: The manufacturing sector provides only about 7% of GDP. Traditional industry consists of boat building and handicrafts, while modern industry is limited to a few tuna canneries, a bottling plant, and a few enterprises in the capital producing PVC pipe, soap, furniture, and food products.  Garment sector in the Maldives

Garment sector is one area where Maldives gets certain special consideration to export products to Europe and America. A decade ago many companies operated in this sector. In recent years there was a decline in investments in this sector. Still few firms operate in this sector. Some though believe this is a potential sector where entrepreneurs can have achievable business investments.

 Transport sector in the Maldives In Maldives the islands are remotely located from one another. This makes a good transport link vital in between islands. As the sea separates the islands, it is not practical to have land transport systems between islands. There are few islands those are big enough or linked via bridges. For these islands a land transport service may be viable.

Sea transport service is in demand in almost every atoll. At present there are hardly any regular transport links to remote atolls and islands. The existing regular ferry services are provided between Male‘ and close by islands. However, the frequency of these services is not very impressive. Frequent ferry services are only provided between airport and capital Male‘.

Aviation Sector in the Maldives

Aviation industry is relatively a young industry in the Maldives. The largest company which provides national flights is the Maldivian Air Taxi, a foreign investment. At present about three companies including state owned Island Aviation operate in this sector.

Island Aviation mostly provides flights to local people who fly to distant atolls where regional airports are available. The other two companies mainly provide air transportation for tourists from Hulhule‘ International Airport to their designated resort. The aircraft used are sea planes as almost all the islands do not have runways.

Main items imported in 1994

 Aviation Gas,  Marine gas oil,  Timber  Cement,  Cigarette,  Sugar,  Marine diesel engine spare,  Rice,  Wheat flour,  Milk powder.

Main Importing countries in 1994:

 Singapore,  India,  Sri Lanka,  U.A.E,  Hong Kong,  Japan,  Thailand,  Malaysia,

Overviews of business and trade at International Level

Bilateral Assistance

Wherever possible, India has been offering assistance to Maldives in its developmental process. The major projects executed by India are:

(i) Indira Gandhi Memorial Hospital: (IGMH) (ii) Faculty of Engineering Technology (FET)

Bilateral Trade

India and Maldives signed a trade agreement in 1981, which provides for export of essential commodities. Bilateral trade is not commensurate with their potential. In 2009-10, the official figures for the bilateral trade stood at Rs.395.57 crores and heavily in favor of India. The Indian exports were worth Rs.378.49 crores and the imports little over Rs. 17 crores. However, the bilateral trade had declined substantially from the previous year due to the impact of global recession on the country‘s tourism industry.

Bilateral trade figures-

Year Total Exports to Total Imports from Total Trade Maldives Maldives 2005-2006 299.19 8.76 307.95 2006-2007 310.96 13.83 324.79 2007-2008 360.55 16.69 377.24 2008-2009 590.28 17.93 608.21 2009-2010 378.49 17.07 395.57

Present Trade Realations and Business volume of different products with India

India and Maldives share, linguistic, cultural, religious and commercial links steeped in antiquity and enjoy close, cordial and multi-dimensional relations. India was among the first to recognize Maldives after its independence in 1965 and to establish diplomatic relations with the country. India established its mission at the level of CMDA in 1972 and resident High Commissioner in 1980. Maldives opened a fully fledged High Commission in New Delhi in November 2004, at that time one of its only four diplomatic missions worldwide.

Political relations

On international issues Maldives had all the time supported India in multilateral foray, such as the UN, the Commonwealth, the NAMA and the SAARC. Maldives was one of the first countries to convey its support for the candidature of Shri Kamalesh Sharma as the Commonwealth Secretary General. Maldives also co-sponsored the G-4 draft resolutions on UN reforms. India has extended support to Maldives candidature for a non-permanent seat in the UN Security Council for the term 2019-20.

Indians are the second largest expatriate community in the Maldives with a total strength of around 28000. The Indian expatriate community consists of doctors, nurses and technicians, teachers, construction workers, tailors, etc. spread all over the country. Of the country‘s approximately 400 doctors, over 125 are Indians. Similarly around 25% of teachers in Maldives are Indians, mostly at middle and senior levels.

Import- Export

Fish is the largest export product of Maldives, while petroleum products, ships, foodstuffs, clothing, and capital goods are the main imports. The main exports are: fish products. They are More than 60% is exported, fresh, chilled, frozen, dried, salted, and canned tuna exports account for about 90% of all marine product exports. The main imports are: oil, construction material, prepared foodstuffs, vegetables, animal products, electrical appliances, wood products, computers, transport equipment.

Most staple foods must be imported. Poor soil and scarce arable land have historically limited agriculture to a few subsistence crops, such as coconut, banana, breadfruit, papayas, mangoes, taro, betel, chilies, sweet potatoes, and onions.

Main items imported in 1994 and The commodities that are still imported from maldives Aviation Gas, Marine gas oil, Timber, Cement, Cigarette, Sugar, Marine diesel engine spare, Rice, Wheat flour, Milk powder.

Main Importing countries in 1994: the commodities that are still exoported by countries like from Maldives -Singapore, India, Sri Lanka, U.A.E, Hong Kong, Japan, Thailand, Malaysia, United Kingdom, Germany.

PESTEL ANALYSIS

Political situation

The Republic of Maldives has a parliamentary style of government with a strong executive. The country has a largely Muslim population and the laws of the country are consistent with Islamic Shari‘ah law. The Office of the President is the most powerful political institution. The President appoints the Cabinet and members of the judiciary and is both the Chief of State and Head of Government. The President is also Commander in Chief of the armed forces, Minister of Defense and National Security, Minister of Finance and Treasury, and Governor of the Maldivian Monetary Authority. Women have the right to vote in all elections and are eligible for candidature to elected bodies and all public positions, except that of Head of State. The present Constitution, which came into force in 1998, does not provide for an independent judiciary and therefore could be subject to executive influence. The President has the authority to review High Court decisions and through his power is to appoint and dismiss judges without confirmation by the People‘s Majlis, and he can influence the judiciary.

Economic situation The small size of its economy, which is largely dependent on tourism and fisheries, makes the Maldives vulnerable to external shocks. The low-lying islands of which the country is composed are particularly vulnerable to natural risks, as witnessed by the economic recession following the tsunami of December 2004. The country‘s lack of land-based natural and mineral resources means that virtually all economic production is highly dependent on imports, creating a heavy dependence on foreign exchange earnings. Intensive agricultural production is limited because of the hypercalcic soil. All staple food stuffs are basic necessities and items for the tourism industry have to be imported.

Social situation

In terms of Millennium Development Goals, the Maldives is currently one of the most advanced countries in Asia and certainly the most advanced in South Asia. In 2003, the literacy rate among females aged 15 and above reached 97% and the net primary school enrolment rate has risen rapidly from 38% to 92% over the last three decades. Poverty in the Maldives stems primarily from regional disparities in living conditions related to the remoteness of the islands and the lack of infrastructure and social services in the atolls. Although the country‘s current GDP per capita is one of the highest in South Asia, significant disparities exist in income distribution. Just fewer than half the populations earn less than $1.25 per day and the average income of three quarters of the population is $1.60 per day. The population of the Maldives is relatively young, with 44% under 14 years of age.

Environmental situation The environment of the Maldives is extremely fragile and vulnerable. The country is extremely dispersed and fragmented population makes the development problems of the Maldives very unique. Many islands are not more than one meter high so that the threats of climate change and the constant rise in sea levels are a major concern, raising fears that the country could disappear. Environmental issues are consequently fundamental to the Maldives and have been mainstreamed into most policies. The country has adopted strong environmental laws but lacks the necessary technical capacity to enforce them effectively. There is also a lack of ownership of the numerous recommendations and policies that have been made by various development agencies.

Legal aspects of trade in Maldives Maldives has following acts to guide trade for the investors. The original Acts of Parliaments are passed in Maldives language Dhivehi Acts of Parliament (Statutes) Maldives. The acts for trade in Maldives are

Civil Aviation Act of Maldives 2001 Maldives Civil Aviation Act came into force in 2001. This Act makes provision in respect of the registration and operation of civil aircraft in the Maldives; construction, registration, operation and use of civil aerodromes; other matters relating to civil aircraft and aerodromes; and safety of civil aviation in the Maldives. Companies Act of Maldives 1996 The Companies Act of Maldives provides the basis for formation, registration and running of companies in the Maldives.

Consumer Protection Act 1996 This Act provides for the establishment and protection of the rights of consumers.

Contract Act 1991 The Law of Contract 1991 provides definitions of contract and its element such as offer, acceptance and termination of offer etc…

Fisheries Act 1987 The Fisheries Act is called the ―The Fisheries Law of Maldives‖. This Act is the basis for formulation of fisheries regulations and fisheries management and development in the Maldives.

Foreign Investment Act 1979 This is the Act that provides Law on Foreign Investments in the Republic of Maldives. This Law No. 25/79 (Law on Foreign Investment in the Republic of Maldives) was amended by the Citizen‘s

Majlis 1 February 1989 and came into effect on 9 February 1989.

Sale of Goods Act 1991 This Act defines the terms, rights and definitions of related words. It describes the rules of delivery, fitness for purpose, sale to third party and buyer‘s remedy for breach of contract… etc

Tourism Act 1999 The Maldives Tourism Act provides for the determination of zones and islands for the development of tourism in the Maldives; the leasing of islands for development as tourist resorts, the leasing of land for development as tourist hotels and tourist guesthouses, the leasing of places for development as marinas, the management of all such facilities; and the operation of tourist vessels, diving centers and travel agencies, and the regulation of persons providing such services.

PART 2

BUSINESS OPPORTUNITIES IN

MALDIVES

Introduction of the shipping Industry and its role in the economy of Maldives.

In 1948, a public limited company was established in Sri Lanka with the name of Maldives National Trading Corporation (Ceylon) Ltd. (it is also known as MNTC). Its majority of equity shares were held by the Government of Maldives. This company engaged in trading and chartering steamers to carry grain and food commodities to the Maldives.

In 1957 and 1958 MNTC purchased its first two cargo ships. Then company grew steadily over the years and more ships were added to the fleet establishing regular shipping services from Ceylon to the Indian sub-continent and extended to the Arabian Gulf, Red Sea and the Middle East. The Maldives Shipping Limited (MSL) was incorporated in Maldives in May 1967 with 3 ships and by 1980 the company owned over 40 ships.

Shipping: The Maldives has an active merchant shipping fleet consisting of ten cargo ships, one container vessel and an oil tanker. The country‘s largest shipping company is the Government- owned Maldives Shipping Management Ltd but most of the importing and exporting of Maldive‘s do private companies.

Though Maldives has traditionally relied on fishing it also had developed a modest merchant fleet in the region called Maldives Shipping Limited (MSL). But today shipping is a minor actor in the Maldives where only two industries dominate the economy. Fishing provides most employment to the inhabitants. Though the major foreign exchange controls by the tourism.

The importance stems like Shipbuilding, i.e., encompassing shipyards, the marine equipment manufacturers and a large number of service and knowledge providers from the fact a nation's need to manufacture and repair its own Navy and vessels that support its primary industries.

Structure, Functions and Business Activities of shipping Industry

Structure

Nordic Intralogistics is AB as Agents for Choice shipping lines

Over 35 years experience in the shipping industry of having introduced and successfully established few of the internationally renowned Shipping lines like Maldives Shipping Company, Ceylon Shipping Corporation, United States Lines, Thames Shipping and Hyundai Merchant Marine in Indian soil, using the synergies of their overseas offices and a vast client base encompassing the major industrial houses, the new division was launched with the aim of providing tailor made total logistics solutions to customers.

They provide a full range of logistics and transportation services with particular emphasis on efficiency and reliability at competitive rates, and of course, the assurance of a personalized service. Their tactical services include import/export freight-forwarding, ocean, air and surface transportation, custom brokerage and regulatory compliance, project cargo services, warehousing, distribution, etc.

Manned by a dedicated and energetic team of highly trained and experienced professionals who strive tirelessly to provide efficient service to customers to their full satisfaction, the Logistics division is spread in strategic ports of South India viz, Cochin, Chennai, Tuticorin, Vizag, Goa and ICDs of Bangalore, Hyderabad, Coimbatore, etc. We would be expanding our base to important North Indian locations shortly. With a wide network of overseas representations, Choice Shipping Lines is well geared to handle any requirement of its customers.

Villa Group owns and operates a fleet of 28 high speed power boats and 60 powered Dhonies (mechanized wooden boats) to attend to the transportation needs requirements of all the guests of Villa Hotels. And also the service handles excursions and transportation of goods to the resorts.

VSTC has signed an Agreement with the Government of Maldives for the construction and operation of a domestic airport at Maamigili Island in South Ari Atoll to facilitate convenient .transfer of tourists, particularly those arriving by night flights. The airport is expected to be complete by 2005. (v) Shipping Fleet

VSTC owns and operates two cargo ships, five oil tankers; two refer vessels, three barges and tug boats. VSTC has been streamlining its shipping activities and has reduced its fleet size from 13 in 1993 to 8. The remaining ships will VSTC an edge in the distribution of traded goods.

Villa Group is currently embarking upon one of the most exciting and revolutionary Maldivian transportation projects to date. In 2011, construction was complete on Villa Airport Maamigili, a private airport funded by the Villa Group, and the operation of both Villa Airport Maamigili and Villa Air was launched on 1st October 2011.

Villa Air is excited to serve the tourist and Maldivian communities with affordable and efficient services. The Villa Air fleet combines the highest quality aircraft and international safety practices with an expedient and efficient new mode of traveling around the region.

Business Activities

Abu Dhabi Ship Building (ADSB) is looking at various opportunities within the Maldives' rapidly growing marine industries sector. In line with this, company Chairman Homaid Al Shemmari recently met H.E. Mohamed Nasheed, President of the Maldives, during the latter's official visit to the UAE capital, and discussed ADSB's building capacity and potential areas for future opportunity.

Maldives Promotion House – India‘s first cruise ship, MV AMET Majesty, will soon set sail from its home port in Chennai to Maldives. AMET Shipping India Pvt. Ltd, will initially run its cruise liner in a sailing trip on the Chennai high seas on Thursday. It will also cover Port Blair, Karaikal, Phuket, Langkavi and Trincomalee.

AMET Cruises is the second cruise liner and the first Indian to start a service after their new shipping policy was approved in June 2008.

As many as 90,000 Indians go abroad on cruises, said Thomas C. Thottathil, a spokesman for Cox and Kings Ltd. ―The market is growing at 15-20% a year,‖ he said.

The ship that can carry as many as 1,000 passengers will also train students graduating from AMET University, a maritime education institute with a deemed university status run by the same company.

The cruise ship will also sail to Sri Lanka, Thailand, Malaysia and Singapore.

Comparative Position of Shipping Industry with India and Gujarat

India has been blessed with a long coastline of 7,517 kms. The physical features of the coastal regions of India are a sort of terra incognita. Coastal India is characterized by a combination of deltas. And the Indian ports owe their existence to the projection afforded by the natural bars and spits in the Indian coasts. India's geographical setting has played a vital role in the progress of maritime activity.

Given that in the contemporary global economy, developed as well as emerging economies are emphasizing more and more on the importance of coastal trade and shipping, the answer to why India which today is very much firmly planted in the global business not doing as ‗Romans do' is the pressing need of the hour.

ASSESSING PAST PERFORMANCE

The infrastructure in India has always provided tremendous potential for coastal shipping to take off. In the past, the flow of bulk goods from west coast hinterlands to the east coast hinterlands always followed the coastal route. Thus. coal from Kolkata was carried in bulk on regular basis by coastal vessels to ports around the country right up to Kandla and Bhavnagar! And salt in bulk was carried back to Kolkata either from Kutch ports or Tuticorin. In early days, the Karachi - Rangoon stretch vide Colombo was designated as coastal route. The ships carried rice in bulk as well as bags right from Rangoon to Chennai, Tuticorin and across to Kochi and even to Kandla and on the return journey salt, cement and clinker were the cargo carried to Kolkata. While the Indian overseas fleet registered 1173% growth in numbers from 1951 to 2003, the coastal fleet inched upwards in the corresponding period to 209%. Oversees fleet grew by 3256% between 1951 to 2003 whereas coastal fleet increased by just 172%.

India's coastal fleet has been hovering around a meagre level of only 0.6 to 0.7 million gross tonnage (GT) during the last five years. Coastal cargo traffic during the period 1995-96 to 1999-00 grew at CARG of 5.41 per cent in comparison with the coastal tonnage growth in terms of capacity (GT) at CARG of 0.15 per cent.

Coastal cargo traffic during the period 1993- 2003 grew at a Compounded Annual Growth Rate (CAGR) pf 8.4% vis-à-vis the coastal tonnage growth in terms of capacity (gross tonnage) at CAGR of 2.5%. The total cargo moved by Inland Water Transport (IWT) in 2002 –03, was about 2 million tones corresponding to just over 1.5 billion tonne kilometer or 0.15 % of the total inland cargo.

Out of the 244 vessels in 2003, as many as 149 were non-cargo carrying vessels reducing the effective cargo carrying fleet to 95 vessels of 0.43 million GRT. Also the coastal fleet is old with as many as 65% of the cargo vessels over 15 years old. Yet, coastal shipping in India has not developed to its fullest potential. This is precisely evident from the recent statistics. The potential for coastal shipping has not been exploited in India, with its accounting for only 7% of domestic cargo movement.

In spite of the obvious advantages that coastal shipping has over land-based modes in India, it has not grown to become an integral part of the country's transport Infrastructure. Nowadays, Coastal shipping in India is anchored almost where it was decades ago, despite the oft-repeated chant about its potential and the need to develop this mode of transportation. More than 30 per cent of the total traffic handled by the Indian ports is routed through the coastal mode; the sector continues to get the short shrift from the Government and the planners.

A major reason is that coastal shipping has not been receiving the priority it deserves. Though it is a major link in the integrated transport infrastructure system, vital for the country's economic growth, coastal shipping is yet to get the infrastructure status. Present Position and Trend of ships (import) with India (during last

3 to 5 years)

INDIAN SHIPBUILDING INDUSTRY

The world shipbuilding statistics shows that during 2009, the world order book was close to 9226 ships, which was around (-) 18.6% less compared to previous year. In fact, after 2007, new orders for shipbuilding had been reduced by almost half in 2008 and in 2009. Though, completions of the shipbuilding orders have shown improvement over the years. India, currently, has around 32 shipyards, they are owned by: Central Government (6), State Governments (2), public listed private shipyards (3), and privately held shipyards (22). However, the major share of the present ship-building capacity in India is held by eight public sector yards, with Cochin Shipyard Limited and Hindustan Shipyard Limited having capacity and infrastructure to build vessels of 1.1 lakh dwt, and 80,000 dwt, respectively. Barring these two shipyards, the majority of private sector shipyards have limited ability to build vessels in respect of capacity and size of the vessels. Also India‘s capability of building technologically advanced ships, like LNG carriers are relatively less.

Over the years the share of Indian shipping in overseas trade has declined. From 85% in 1981, it has declined to 32% in 2009. As on September 2010, India had 693 vessels under coastal trade and 336 vessels under overseas trade with a total of 1029 ships in total.

It may be mention that the state-owned Shipping Corporation of India (SCI) has already started building strategic tie-ups through collaborative approach. SCI has joined hands with Mitusi Osaka Shosen Kaisha (OSK), a association in Japan, to build LNG vessel to serve India‘s needs. Even the private companies have shown interest in LNG transportation.

Policies and Norms of Maldives for Shipping Industry for import including licensing / permission, taxation etc.

Entry Requirements - Passport validity

One must hold a valid passport to enter Maldives. Your passport must be valid for the proposed duration of your stay. No additional period of validity beyond this is required. However, it is always sensible to have a short period of extra validity on your passport in case of any unforeseen delays to your exit. You do not have to wait until your old passport expires to apply to renew it. Any time left on your old passport when you apply will be added to your new passport, up to a maximum of nine months.

Local laws and customs:

Maldives has very strong anti-drug laws. Importation or possession of drugs in Maldives can carry severe penalties, including life imprisonment. Local laws reflect the fact that Maldives is an Islamic country and serious violations of local laws may lead to a prison sentence. Public observance of any other religion other than Islam is prohibited. You should respect local traditions, customs, laws and religions at all times and be aware of your actions to ensure that they do not offend other cultures or religious beliefs, especially during the holy month of Ramadan or if you intend to visit religious areas.

It is an offence to import into Maldives: explosives, weapons, firearms and ammunition; pornographic material; materials deemed contrary to Islam, including ―idols for worship‖ and bibles; pork and pork products; and alcohol. Alcoholic beverages are only available on resort islands. The export of tortoise shell and coral is forbidden. Same sex relations are illegal and convicted offenders could face lengthy prison sentences and fines. Mariners in possession of firearms must surrender them to the local authorities. Any unregistered firearms will not be returned to the owner.

General - Insurance

You should take out comprehensive travel and medical insurance before travelling. If you plan to go diving or engage in other water sports, you should check that your insurance policy covers these. Check for any exclusions and that your policy covers you for all the activities you want to undertake. The most common problems faced by visiting British nationals in Maldives are lost passports and swimming/diving related accidents.

General - Money

Island resorts in Maldives are generally expensive and you should bring sufficient funds. There are no cash machines and travelers‘ cheques are used infrequently. Major credit cards are accepted at most resorts and hotels. US dollars can be exchanged at the airport, banks or hotels.

Safety and Security – Terrorism

There is a general threat from terrorism and attacks could be indiscriminate, including in places frequented by expatriates and foreign travelers including tourists. On 29 September 2007, a small bomb exploded on the capital island of Male, injuring a number of foreigners including two British nationals.

Safety and Security - Local Travel - Sea Travel

Piracy is a significant threat in the Gulf of Aden and Indian Ocean, it is especially for shipping which does not take appropriate precautions or follow agreed shipping industry best practice guidelines. The Maldivian authorities are currently detaining number of individuals who is suspected to have been involved in piracy outside of the Maldives‘ Economic Exclusive Zone (EEZ). On 26 March 2012 an Iranian-owned cargo ship was seized by Somali pirates within its EEZ which was subsequently released.

(2) IMPORT PROCEDURE

(i) Import

There are three international ports in Maldives. Gan International Airport at S. Gan, Male' International Airport at Hulule, and the Male' commercial sea port situated at commercial harbour of the capital, Male'.

(ii) Import Duty

All cargo imported to Maldives are dutiable, except items brought by passengers for personal use, in non commercial quantities Import duty is levied on the CIF value of the goods. The rate of duty percentage is listed in the Import Tariff book.

(iii) Import Licenses

Imports in commercial quantities have to be accompanied by a Import Trade License issued by the Ministry of Trade and Industries. A temporary license is issued for occasional importers.

(iv) Temporary Imports

On request, Customs may allow the temporary importation of goods and equipment for trade promotion, scientific research and other professional use. Duration allowed for such importation is 14 days, after which import duty must be paid for them.

(v) Import Procedure

Goods entering the Republic of Maldives must go through four main customs procedures before they can be imported:- 1)Valuation, 2)Documentation, 3)Payment of Duty, 4)Examination & Release of Cargo

The speed of these processes is mainly dependent on the clarity of the documents submitted by the importer and the amount of information provided in the documents. (vi) Valuation

All commercial imports must have accompanying invoices which are subjected to the Customs invoices valuation process for duty calculation. In this regard, the importer should submit the following documents to the Valuation Section of the Maldives Customs Service: 1)Original and three copies of the commercial invoice, 2) Bill of Lading or the Air Way Bill, 3) Packing list, 4)Bank documents

When the invoice valuation process is completed the importer will be given a copy of the Maldives Customs Service endorsed commercial invoice stipulating the value of the goods sought to be imported as determined by the Maldives Customs Service. Duty for the goods so imported would be levied on the basis of the approved prices.

(vii) Documentation

The importer should fill in the Customs Declaration Form based on the Maldives Customs Service endorsed commercial invoice. The following documents should then be submitted to the Documentation Section of the Maldives Customs Service: 1) Maldives Customs Service endorsed commercial invoice,2)Two sets of Customs Declaration Forms.

These documents will be verified by the Documentation Section and assessed for the duty to be levied on the goods. After assessment, the importer will be given an endorsed copy of the declaration for the payment of the duty. Upon payment of duty, the cargo is ready for examination.

(viii) EDI Services

Import/Export documents can be submitted to the Customs through EDI (Electronic Data Interchange) . However, only authorized users can access these services.

Policies and Norms of India for Import to Maldives including licensing / permission, taxation etc

The policies followed by Indian shipping industry are explained here. There is a need for the Government to grant special status to coastal shipping so as to exempt it from Customs and other procedures that apply to the bigger cargo-carrying vessels. Taxation policies of India are

Corporate tax

Till now, the Indian shipping companies had to pay corporation tax at the rate of 36.75% or the minimum alternate tax at 7.5%. The industry also enjoyed benefits under Section 33 AC of Income Tax Act. Additionally shipping companies now have the option of choosing between corporate tax and tonnage tax. This benefit, is restricted to ocean going vessels to make them competitive with vessels registered under other national flags, and is not available to coastal shipping.

Personal Income Tax:

The present system of income tax differentiates against the seafarers employed on Indian coastal vessels. Indian seafarers who are engaged on foreign vessels for 183 days or more in a year or on an Indian vessel, which work outside Indian territorial waters for more than 183 days in a year, are entitled to non-resident status and pay no taxes. This dispirits officers and seafarers from enlisting on coastal ships and makes it all the more obligatory to appraise the aptitude requirements and improve the emoluments.

Capital Intensive nature:

Shipping is a capital-intensive industry. In India, the cost of capital is higher compared to many other countries. To raise equity capital, shipping should attract investors. To enhance investor appeal for developing a larger equity base and encouraging larger investment in coastal shipping, time-bound solutions would have to be found for many of the complicated and vexing problems such as levy of Customs duty on spares, stores and bunkers imported by coastal operators etc confronted by the sector. Unlike other industries, the benefits of waiver from payment of import duty in shipping are available only to the intermediary (SRUs) who imports the spares and not to the end-user (ship owner) in the coastal shipping business.

Cabbotage law:

Cabbotage Law in most countries reserves the movement of coastal trade of the country for its own flag vessels. In the international arena, majority of maritime nations protect their domestic transportation industries through Cabbotage laws (imposing restrictions such as crewing restrictions, ownership restrictions, provisions for domestic fleet subsidy, provisions for subsidy etc). The Indian Merchant Shipping Act does not permit foreign bottoms to carry cargo between Indian ports nonetheless; foreign ships are permitted to ply between Indian coasts if no suitable Indian vessels are available. These provisions were protecting existing Indian tonnage on the one hand; discourage the adequateness of coastal shipping in Indian tonnage. While on the one hand the Indian industry is not aggressive enough to increase the share of coastal shipping, on the other hand the Indian taxes and duties do not apply to foreign vessels. They usually operate under favorable taxation rules, subsidies and lower costs. Hence, foreign vessels have inherent advantages as compared to Indian vessels. Relaxing the Cabbotage laws could, therefore, impact on the growth of the Indian tonnage available for coastal shipping. It will help create a level playing field, given that the Indian coastal operators have been seeking exclusive rights of operation for the members to ensure sustainable development of coastal shipping for quite some time now. The option of reintroducing Cabbotage laws once again on attaining sustainable costal cargo growth levels could also be considered.

Ship Acquisition: The coastal tonnage in India has been more or less dormant. One of the reasons for this, apart from the productivity of coastal shipping, is the complexity in getting finance at low interest rates. Although coastal ships are also permitted to external commercial borrowing, they are effectively not in position to do so as they do not earn in foreign exchange.

Import Licensing

India maintains a negative import list of products subject to various forms of nontariff regulation. The negative list is currently divided into three categories: banned or prohibited items (e.g., tallow); restricted items that require an import license (e.g., livestock products); and "canalized" items (e.g., petroleum products,) importable only by government trading monopolies subject to cabinet approval regarding timing and quantity.

Standards, Testing, Labeling, And Certification: In early 2009, the GOI revised its mandatory certification compliance list, which now includes 85 specific commodities. The revised list includes such products as milk powder, infant formula, bottled drinking water, certain types of cement, household and similar electrical appliances, gas cylinders, certain steel products and multi-purpose dry cell batteries. Products on the mandatory certification list must be certified for safety by the Bureau of Indian Standards (BIS) before the products are allowed to enter the country.

Present Trade barriers for import of ships

Maldives imports much more than it exports, which creates a trade deficit. The state budget is heavily dependent on the income from import rights. Therefore, customs duties are relatively high. However, as part of its trade policy framework, the government has removed quotas from most of the products and customs procedures have been simplified . Moreover, although the State Trading Organization (STO) is still the largest importer, the government is now trying to bring in more private players.

The following particulars are required by the local authorities:

1)Name of the vessel, 2)Name of the Master and Nationality, 3)Name of the Ship Owner, 4)Name of the Local Agent,5)Port of Registry and Number,6)Call Sign, 7)ETA to the Port, 8)Last Port and Next port of Call, 9)Type of Vessel, 10)Air Draught, 11)Cargo for Discharge, 12)Details of Dangerous Cargo for Male

ISP Code Notification 24hrs prior to vessel arrival to the port:

 Name of the Ship Security Officer  Validity of International Ship Security Certificate and the issuing authority  Security level at which the vessel is currently operating  Name of the last 10 ports of call where interface with port or ship took place  The security level at which the ship operated in any previous port facility or conducted a ship/port interface during last 10 calls at port facilities  Any special or additional security measures that were taken by the ship in any previous port where it has conducted a ship/port interface during last 10 calls at port facilities  Confirmation that appropriate ship security procedures were maintained during any ship to ship activity during last 10 calls at port facility.  Any other security related information to ensure the safety and security of persons port facilities, ships and other property.  Any Stowaways on board.  Commodity Discharge/Qty

DOCUMENTS REQUIRED

DOCUMENTS NO.OF COPIES

Crew List 7

Passenger List 7

Stowaways 2

Tobacco/Sprit/Personal Effects 2

Stores 1

Arms and ammunition/Narcotics 1

Health documents or certificates 1

Certificate of Deratting 1

Ship's All Safety Certificates For Port State Survey

Officers/crew competency certificates (original) For Port State Survey

Cargo gear certificate Valid

Bills of landing 2

Manifest (freighted) 4

Un-Manifested cargo list 4

RADIO INFORMATION

AUTHORITY VHF TEL FAX EMAIL/TELEX

Pilot station 10 3328624 3328624 N/A

Pilot Vessel 10 N/A N/A N/A

Pilot 10 7775397 N/A N/A

Port Authority 11 3329339 3323252 N/A

Coastguard 16 3325981 3323981 N/A

Harbour Master 7771966 3327883 N/A

Tugs 11 N/A N/A N/A

Terminal Operation 11 N/A N/A N/A

HEALTH - Medical facilities are available

 Port Health clearance by radio not applicable  Any sick person or dead body on board should be notified to Port Health by cable, 24hrs in advance  Yellow fever vaccination certificate is required only if the vessel has called at yellow fever area during last 30 days  Permission to be obtained to bring animals including pets with valid health certificates  Vessel entering Maldivian ports must display international quarantine signal till health formalities are completed by port health officer

CUSTOMS AND IMMIGRATION

Maldives Customs Services are currently located at Boduthakurufaanu Magu, behind the commercial harbour premises. The following is a notification from the Maldives Customs Services to vessels calling at Male' commercial Harbour:

 All ships are required to submit a port clearance, cargo manifest, passenger and crew list and where applicable, any other relevant documents  Departure time should be reported and port clearance obtained  All visitors, officers, crew and passengers of ships are requested to use the Male' Commercial Services  Foreigners are not allowed to land at Male' after 10:00 pm without prior permission  Foreigners landing at Male' should go on board before 10:00 pm

PROHIBITED IMPORTS INTO MALDIVES

 Prohibited items of import (except for use of the state)  Any type of gun powder  Weapons of war  Opium, Ganja, Cocaine, and any other items, which could be used as an intoxicant  Articles carried by foreign distinguished persons signifying their ranks, titles or honors and articles carried in connection with such rank. Titles or honors by those who accompany such distinguished guests shall be the exception to this article  Prohibited items of import without a permit from the government-concerned ministry ( except for the use of the state)  All forms of poisons and sulphuric acid  Nitrates  Dangerous Animals  Alcoholic Drinks  Dogs  Pigs or Pork  Status (used for warship)  Totally prohibited items if imports into Maldives  Nude of pornographic cards  In addition to items stipulated in this bill, the principal collector of Customs shall with hold such items, the import of which in his opinion shall be prohibited and bring the matter to the notice of Ministry of Trade and Industries. The final settlement will be in accordance with the decision of that Ministry. STANDARD MESSAGE

Vessel calling Maldives Ports should send ETA message 48 hours in advance as per Port Circular MPA-H-99-02. Vessels approaching Male' Port should contact Harbour Control on VHF channel 10, 2 hours prior to arrival at the Pilot Boarding Ground.

NOTICE OF READINESS (NOR)

Vessels should report Maldives Ports Authority as soon as they receive inward clearance from Customs/Immigration/Port Health.

AGENCY

All agents nominated must be approved by the Ministry of Trade and Industry, Customs and Maldives Port Authority.

GOVERNMENT REGULATION

1) Notice is hereby given that it is expressly forbidden for any vessel to dump or discharge into any harbour, lagoon, or into any part of the waters of the Maldives, refuse, bunker oil, sewage, noxious substances or any materials or substances whatsoever. 2) The Master of any vessel and /or its agents will be held directly responsible for any nature or degree of pollution of the water, lagoon and Islands of the Republic of Maldives through the dumping or discharge of any refuse and /or substances. 3) In the event of any nature of degree of pollution of Territorial water of the Republic of Maldives due to the dumping or discharging of refuse and /or substances, the master and /or the agent of the offending vessel shall be subject to an immediate fine deemed by the Authority concerned according to Maldivian Law Potential for import in India / Gujarat Market

Procedure for governing subsidy support: with Indian shipyards suffering systemic and scale disadvantages, the policy of GOI to extend subsidy support to Indian shipbuilders enabled them to effectively compete in the global market. However, after expiry of the subsidy scheme, even as its renewal is under construction, there is a need to ensure that that prescriptive procedures governing eligibility to receive subsidy are removed.

Deficient infrastructure: Indian yards today lack the capability to build large and modern ships. Presently, the Cochin shipyard is the only one that has the capability to build large and modern ships. While the government has provided subsidies to shipyards but it has to ensure that the benefits reach the private players as well.

Disadvantages that are accruing from small scale of operations: The shipbuilding sector in China and South Korea have received government‘s fiscal and policy support, enabling them to develop scale as well as a cluster of ancillaries. These advantages of scale are not available to Indian shipbuilding industry, which imports most of its input materials and is therefore unable to leverage advantages offered by bulk purchases and Just in Time supplies. As a result there is significant cost disadvantages on account of import dependence which eat into low labor cost advantages of Indian shipbuilders. Lack of ship design and limited investment in R&D: Indian players need to work hard to meet the international players in ship automation and technology

Benchmarking it to international standards: The Indian shipbuilders must focus on benchmarking their own processes to international standards to improve the efficiency, delivery time, price and quality, which will in turn, will enhance the competitiveness of the shipbuilding sector. Measures such as performance incentives, PPP models, etc could be introduced to improve efficiency.

Supporting the growth of ancillary industries: Ancillaries need to develop along with the shipbuilding industry as they are the key competitive differentiator for establishing/relocating shipbuilding and ship repair facilities. A cluster development approach for building ancillary capacity could be adopted.

Training and human skills issues: Development of training programs in various academies to produce high quality talent should be prime focus. No tariff protection from imports

Multiple clearances: As the industry Is dynamic and cyclical in nature these clearances result in procedural delays and hampers augmentation of capacity

(A) Presently there is no supervisory Authority/Apex body

(B) High customs and excise Duty on capital investment: The government levies 35% duty on all capital equipments such as cranes, plasma cutting machines, and other material handling equipment purchased for running a shipyard

(C) Duty on sale of ships to Indian Shipping Companies: The materials and parts imported for building ships are exempted from payment of custom duties but these ships once built are treated as imported ships and a custom duty of 5.0% is levied on them

(D) Onerous Tax Structure: Indian shipyards are subject to 19 different taxes/ duties. These taxes cumulatively put Indian shipyards at a disadvantage and diminish their cost competitive as compared to the international players.

Business Opportunities in future

Coastal shipping is a new opportunity on the horizon for India's economic development. Coastal shipping's potential lies in transporting less time critical freight. It represents an environmentally beneficial and cost effective alternative to rail and road modes, for bulk cargo shipped over long distances. Also it does not require the same infrastructure investment or maintenance.

At the end of the day shipping is still the cheapest way to run large volumes of cargo long distances – by a mile. One does not have to construct a highway. Traders would need to have a channel but once they get out to sea it is blue water. They do not have to maintain anything, apart from your channel.

CONCLUSIONS AND RECOMMENDATIONS

The conclusion that is arrived for the project is that Maldives is efficient enough in ship building and its share in the country‘s economy is also increasing, while India‘s status in shipbuilding and exports is poor and is now developing due to imports from other countries. Thus, India can get ship imports more from Maldives and for this it should adjust its import capabilities and improve it.

The countries India and Maldives who are members of SAARC ASSOCIATION should increase trade between them. This could help in the development and growth of both the countries.

REFERENCES

www.amcangroup.com www.articlesbase.com www.pedz.uni-mannheim.de www.fco.gov.uk meaindia.nic.in www.customs.gov.mv

“GROWING INDUSTRY AND SECTORS IN MALDIVES & FOOD INDUSTRY IN MALDIVES”

CONTENT

Particulars Page No. PART I

 Demographic Profile 8  General economic overview 10  Industrial Overview 11  Overview of trade &commerce 12  Legal aspects of Trade 13  Trade relationship with India 14

PART II

 Introduction to Food Industry 16  Role in Maldives 17  Structure & function of food industry 19  Present position & trend of business with India 22  Policy & Norms of food industry in Maldives 23  Export Cycle 25  Payment terms 26  Document required for export 27  Govt. requirement for support 30  Present trade barrier for Export of food in 33 Maldives  Opportunity for food industry in Maldives 34  Conclusion & suggestion 35  References 36

PART 1

GROWING INDUSTRY OF MALDIVES

DEMOGRAPHIC PROFILE

Population, age structure, population growth rate, birth rate , death rate etc., these are the factor which considetr in demographic profile which are as under

Population: Total population of Maldives country is near about 3,94,999 as per year 2011

Age structure : Age structure can be classified in 3 category which are as under

Years Male Female Percentage (%) 0-14 43332 41642 21.5% 15-64 177365 116552 74.4 >64 7888 8220 4.1

Birth rate: The birth rate of Maldives is approximately 14.83 births per 1000 population

Death Rate: The death rate of Maldives is approximately 3.71 deaths per 1000 population.

Migration Rate: The migration rate of Maldives is 12.62 out of 1000 population

Urbanization: The population of urban area is 40%

Sex Ratio:

Age Ratio(Male/ female) At Birth 1.05 <15 1.04 15 – 64 1.57 >64 0.98 Total 1.4

Infant Mortality rate:

Particular Out of 1000 live birth

Male 29.93

Female 24.84 Total 27.45

Life expectancy at birth:

Particular Year

Male 72.22

Female 76.8

Total 74.45

Nationality: Nationality of Maldives country is Maldivian

Religions: The religions of Maldives is Sunni Muslim which is official religions of Maldives

Languages: The official language of Maldives is Dhivehi & English language which is spoken mostly in government sector

School Life expectancy: For male school life is up to 13 years & for female up to 12 years

Education Expenditure: The government spends 11.2 % of GDP behind Education Expenditure

Health Expenditure: The government spends 5.6% of GDP behind health Expenditure

GENERAL ECONOMIC OVERVIEW

Of the Maldives' 1,191 islands, only 200 are inhabited. The population is scattered throughout the country, with the greatest concentration on the capital island, Male. Limitations on potable water and arable land constrain expansion. While income disparity remains high, particularly between the capital and distant islands, the Maldives' growth has yielded considerable social progress. The net enrollment in primary education is close to 100%. Literacy rates are about 97%. Infant and maternal mortality are declining rapidly.

GDP in 2010 totaled $1.48 billion, or about $4,770 per capita. From 2000-2010, real GDP growth averaged around 6% per year except for 2005, when GDP declined following the Indian Ocean tsunami, and 2009 when GDP shrank by 2% as tourist arrivals declined and capital flows plunged in the wake of the global financial crisis. The Maldives Monetary Authority (Central Bank) expects GDP growth around 4% in 2011. Inflation was at 4.7% in 2010.

INDUSTRY OVERVIEW

Industry in the Maldives include mainly of garment product, boat building, and handicrafts. It accounts for about 18% of GDP. Maldivian authorities are concerned about the impact possible global warming in the country.

Among the 1,900 islands in the Maldives, only 198 are settled. The population is spread throughout the country, and the greatest concentration is on the capital island. Limitations on clean water and arable land, plus the added trouble of congestion are some of the trouble faced by households in Malé.

Development of the infrastructure is mainly dependent on the tourism industry and its corresponding tertiary sectors, transport, distribution, real estate, construction, and government. Taxes on the tourist industry have been plowed into infrastructure and it is used to advance technology in the agricultural sector.

The Industry of Maldives which can be divided in following parts  Fishing Industry o Pole and Line Fishing o Industrial Fishing o Fish Cannery o Reef Fisheries  Tourism industry  Transport Sector  Aviation Sector

In short, tourism sector gives 20% contribution of Total GDP , Agriculrual sector also play minor role in the economy because there is less cultivated land. Other industry also play an important role like Garments, boat building, and handicraft and total contribution of these industries is a8% of gdp

OVERVIEW OF TRADE & COMMERCE

Although there is limited production facility available in the Maldives, there is a lots of opportunity of making the business. The maldive is a member country of WTO. This organization help the Maldive to make business more effective.

The WTO helps the Maldivian people to make the business relationship more strong with the other developed & developing countries in terms of business.

If we see the structure of Maldives the agriculture sector provide 5.6%\, industry gives 16.9% while the service sector contributes 77.5% in the overall GDP .

If we compare the employment opportunity in the different sectors then also agriculture provide the 11% employment industry gives 23% & the service sector gives 65% of the employment opportunities.

LEGAL ASPECTS OF TRADE & COMMERCE

For economic development & reduce the level of poverty there are so many trade policy have emerged in Maldives. Now a days globalization & loiberalization increases that‘s why international trade has also been emerged.There Are some legal aspects of trade are as under

 Trade Regime(Import)  Trade regime (Export)  Multilateral Trading System  Free Trade Agreements  Prefential schemes

1. Trade Regime(Import) This aspects is specially made for import. It means that if any one want to import any goods or anythingfor business purpose from any other country than they want to take general import licence which is issued by the ministry of economic Development & trade

2. Trade regime (Export) Those who want to export goods from Maldives to other country for business purpose then they have to follow this legal aspect which specially made for export. In Maldives there apply some foreign investment royalty to export clothing. There is strick regulation made for fish export & if any one want to export the fish then they have to take licence for fish export

3. Multilateral Trading System It is the founder of World trade Organization. Maldives country follow the international rules & regulation. The main area that will affect the Maldives are  Agriculture  Trips( Trade Related Aspects of Intellectual Prperties)  Gats(General Agreement on Trade in service)  NAMA( Non Agricultural Market Access)

4. Free Trade Agreements The main benefit of Free Trade Agreement is that they can import certain goods such as Pharmaceuticals. Through this trade they can freely negotiating trade agreement with India, China , srilanka & Quatar

5. Prefential schemes The main trade partner of Maldives is Europe & Japan. From these scheme mladivien gets the export the benefits so it is the good for Maldives because through which it helpful to export the goods & which ultimately lead to economy development as well as increases the employment opportunity. PRESENT TRADE RELATIONSHIP WITH INDIA

India and Maldives officially decided their boundary in 1976, although a minor diplomatic incident occurred in 1982 when the brother of the President of Maldives Maumoon Abdul Gayoom declared that the neighboring. Minicoy Island that belonged to India was a part of Maldives; Maldives quickly and officially denied that it was laying claim to the island. India and Maldives signed a complete trade agreement in 1981. Both nations are founding members of the South Asian Association for Regional Cooperation (SAARC), the South Asian Economic Union and signatories to the South Asia Free Trade Agreement. Indian and Maldivian leaders have maintained high-level contacts and consultations on regional issues.

There are various relationship between India & Maldives & it will helpful to build good business relationship. The relationship with Maldives which are as under

 Bilateral relation  Operation Relation  Commercial Relation  Military Relation

Commercial relation:

India has developed bilateral agreement with the Maldives for the development of infrastructure, health, civil aviation, telecommunication and labour resources of country. India has established Indira Gandhi Memorial Hospital in Male which is the capital of Maldives. During the 2006 India has exported about 384 crores and imported worth less than Rs. 6 crores in the Maldives. The state bank of India also had contributes 500 US $ for the economic expansion of Maldives

PART 2

EXPORT OPPORTUNITY IN FOOD INDUSTRY OF MALDIVES

INTRODUCTION TO FOOD INDUSTRY

There are many industries which can be work in any economy. It‘s depending upon the system & economical condition of the country. The resources available in the country also play a vital role in the development of the country. India is said to be the Golden sparrow. People of different country came in the country to make the business with the India. Specially Dutch, Portuguese, & Britishers came in the country to make the business with India. Specially they have focus on the some great items in the country like (mari masala & tejana). Now we have great time to make this as a opportunities for the country by exploiting it & develop the business relation with the other country. Food industry is a very important part of the economy of India. We have the different part of this food industry to exploit it as an opportunity.  Food manufacturing  Beverage manufacturing  Food & beverage stores  Food services & drinking places

This industry is always comprised of many sub industries. The following is a sample of data for the sub industries.  Breakfast cereal manufacturing  Frozen food manufacturing  Dairy products (except frozen) manufacturing  Bread & bakery product manufacturing  Soft drink & ice manufacturing  Breweries  Distilleries  Supermarket & other grocery (except convenience) stores  Full service restaurants  Limited service eating place  Drinking places(alcoholic beverage)

FOOD SECTOR & ITS ROLE IN THE MALDIVE

As we all know that the domestic food & beverage industry is a very mature & competitive industry with little growth at the domestic level. Increase in the market share of any industry in the economy come at the expense of the loss of market share of the other industry. In short most of the growth comes from the international expansion. The government of any country always put some rules & regulations for the exporting or importing any goods or services because of the fear of the decreasing share of the domestic country or the decreasing value of the domestic supply, which will ultimately lead toward the recessionary phase in the country.

Now a day‘s food industry plays a very important role in the country because of the increasing population in the country. On the contrary the government tries to manage the demand & supply of the food items.

For example in India, we have ban on the export of rice because the government is not able to fulfill the domestic demand.

But there is always loophole in the system like, we also have a ban on the exporting of the onion, but the onion powder can be exported in the other country. Even we have a Hugh market in the Bhavnagar.

If we take other example, much domestic food and beverage companies want to take advantage of existing distribution systems, or underutilized plant capacity. Some acquisitions may be motivated by Federal income tax considerations.

From the time that agriculture began about 7,000 years ago to the present there have been many important developments that are responsible for the state of the industry as it is today. The following events have had a major impact on where the industry is today.

EVENTS THAT HAVE MAJOR IMPACT ON FOOD INDUSTRY

•The use of some form of irrigation is well documented throughout the history of civilization. It has enabled food IRRIGATION production to occur in areas previously too hostile for plants and to counter the effects of drought.

•Resulted in mass production of food products at lower cost INDUSTRIAL REVOLUTION and consistent characteristics.

•Classified into two main groups, antioxidants that delay or prevent the deterioration of foods by oxidative materials and FOOD PRESERVATIVES antimicrobial agents that inhibit the growth of spoilage and pathogenic microorganisms in food.

•Tinned products came to America in 1822 and allowed food to be stored for long periods of time. Some packaging PACKAGING processes were developed to enable Napoleon’s armies to carry war to distant areas and remain well fed.

•A partial sterilization accomplished by raising milk to a temperature high enough to destroy pathogenic PASTEURIZATION bacteria. This process allows milk to remain consumable for about 14 days if refrigerated in closed containers.

•First, railroads and barges, then trucks and air transportation have enabled many food products to be TRANSPORTATION enjoyed in regions where food cannot be grown. Many locally grown food products can be consumed globally (bananas, fish, fruit, etc.).

PESTICIDES •Enabled farmers to significantly increase yield.

•In the 1950’s and forward, nutrition became a major concern for production/consumption. The emphasis on NUTRITION eating healthy has spawned a new market segment; for example organic foods, low-fat foods and healthy foods all enjoy healthy margins and increased demand.

STRUCTURE & BUSINESS ACTIVITY OF FOOD INDUSTRY

STRUCTURE OF FOOD INDUSTRY

Structure of food industry which can be divide in 3 part which are as under  Unorganized sector  Small scale industry  Organized sector

1. Unorganized sector:

The total contribution of unorganized sector in food processing industry is 42% which means that unorganized sector play an important role in food industry

2. Small Scale Industry :

The total contribution of Small Scale sector in food processing industry is 33% which means that Small Scale sector also play an important role in food industry but as compare to unorganized sector it is very less

3. Organized Sector :

The total contribution of organized sector in food processing industry is 25% which means that organized sector also play an important role in food industry but as compare to unorganized & Small Scale sector is very less so they have to make some policy which increase the growth of organized sector.

FOOD INDUSTRY

Food industry can be classified in following part

 Restaurant Industry  Beverages  Food Manufacturers

A. Restaurant Industry

As a general rule full service restaurants are for the most part company owned with very little franchising. Fast food restaurants are heavily involved in franchising activities. Franchisees will pay a fixed per-cent of receipts to a franchiser for advertising and royalties. Some fast food franchisers will lease the structure to the franchisee for a monthly rate or a percentage of sales. Suppliers will help restaurant chains with marketing and advertising funds. It is not unusual for major suppliers to offer rebates or provide upfront payments to obtain exclusive supplier status.

The internal controls of these chain restaurants are extensive; conversely individual independent restaurants do not always enjoy these controls over operations.

Normally restaurants purchase from foodservice companies or they may purchase their inventory from a national chain commissary. Perishable goods are usually purchased from a local vendor.

Four tip reporting programs are available for these taxpayers to enter into with the Service. Two of these pro forma documents are titled Tip Reporting Alternative Commitment (TRAC) and Tip Rate Determination Agreements (TRDA). The IRS developed the Employer Designed Tip Reporting Alternative Commitment (EmTRAC) Agreement program in response to employers in the food and beverage industry who expressed an interest in designing their own TRAC programs. Attributed Tip Income Program (ATIP) is a new three-year pilot program for food and beverage employers. The agreements serve a dual purpose: improving compliance of tipped employees and avoiding tip examinations. The TRAC agreement is by far the more popular with large and midsized taxpayers.

B. Beverages

Normally manufacturers of alcoholic and non-alcoholic beverages sell to distributors who own a franchise to sell in a given geographic area. There is extensive government oversight over the liquor industry and individual states and local jurisdictions usually have rules and regulations affecting the sale of these beverages within their jurisdictions.

These beverage companies are very competitive and are focusing a lot of their activities in expanding internationally.

C. Food Manufacturers

It is not uncommon for food manufacturers to spend more money advertising its products than making the product. Most of these companies have to pay a fee to get a retailer to provide shelf space for the manufacturer‘s products (slotting payments). Some of the largest national advertising budgets are those of food and beverage companies.

Manufacturers (vendors) provide various discounts and promotional funds to retailers, (volume, price, early payment, seasonal, rebates, cooperative advertising funds, market development funds, slotting, etc.)

ECR (Efficient Consumer Response) is a concept that has been around since the late 1980‘s and is an initiative undertaken jointly by the manufacturers, distributors and retailers to improve distribution practices and clean up abuses in the industry. Trade allowance practices, including deductions are a major component of the process. The scanning features on cash registers provide data to all parties to make this process more efficient.

The use of coupons is extensive; many manufacturers have set up web-sites that provide coupons on-line. These coupons are also available in the stores, magazines, newspapers and through the mail.

Most manufacturers of food products have adopted just in time manufacturing processes.

PRESENT POSITION & TRENDS OF BUSINESS WITH INDIA

In the beginning of the early 1980s, there is a trend of merger & acquisition activities have been started in the food & beverage industry. Many companies had taken the opportunities in India after the policy of the LPG to earn the business in the India. Several food and beverage manufacturers have spun off their restaurant businesses.

Now days it becomes trend in the India that many food market leaders came in the India to have the business of the world second largest population of the country.

For example, many international brands like Mc Donald‘s; Subway came in the country & had captured a large market share of the Indian food industry.

It becomes tendency of the people of the India that they will start preferring the branded products especially in food items & every Sunday people has tendency to eat out of the home with either family or with the friends. So it has the wide opportunity for the business people to earn money out of it.

Concept of franchisee:-

There is new concept of franchisee developed in all over the world. The new trend has been established since last decade. Most of the Business men focus on the different ideas of making more money. This is one of the ideas to capture this opportunity by providing the people qualitative food at the same time when they want with that quality which is served at that county. The franchisee owner always tries to maintain the same taste at all over the branches. The new trend which has been started in the country is to have the branches of the international or MNCs in the India. This new concept has achieved the glorious response from the people of India & the different companies have taken this opportunity seriously because the India has the second largest size of the population. So it is the most beneficial thing for the business to have a Hugh market. The companies have used the market penetration strategy to enter in to Indian market

POLICY & NORMS OF MALDIVE FOR FOOD INDUSTRY (INCLUDING LICENCING, PERMISSION & TAXATION ETC.,)

The Maldivian economy was entirely dependent on fisheries and other marine products for many centuries and fishery and related activities remain the main occupations of a significant proportion of people; the government provides priority to the development of the fisheries sector. At present, fisheries contribute over 15 percent of GDP and engage about 30 percent of the country‘s work force. Outside of Male‘, fishing and subsistence agriculture (mainly horticulture) is the main source of food security and livelihoods for the vast majority of the people

There is liberalized overall policy regime with the specific incentives for high priority of food processing. Norms permitted for 100 percent equity of Indian companies. For example currently we are exporting the poultry items especially to Maldives & Oman.

Tourism & fishing are the main business or industries of the economy of Maldives. Apart from it tourism & hospitality is also an important part of the Maldives. So they have to make free economic condition & liberalized situation for the people of different country to come to the Maldives. Because it is only the area on which the development of the economy depends on.

They need to develop the food industry if they want to develop the economy. & that‘s only why they had made the liberalized economic conditions for the food industry.

POLICY & NORMS OF INDIA FOR EXPORT IN MALDIVE INCLUDING LICENCE, PERMISSION & TAXATION

As far as our Indian situation is concern our economy is free economy. We like to have a business with the people of other country. So the procedure for the exporting is the same in most the products. There are some rules & regulation which will be for the exporting in the different company

1. FOREIGN TRADE ACT 2. FEMA 3. FERA 4. CUSTOM ACT 5. CENTRAL EXCIZE ACT

1. FOREIGN TRADE ACT: - this act will be covered under the ministry of commerce & governed by Director General Of Foreign Trade.(DGFT) Foreign trade policy was developed for 2009-2014 & it is covered under the chapter no 3 and 4.

2. FOREIGN EXCHANGE MANAGEMENT ACT: - The act will manage all the aspect related to the export & import. The rules & regulation will be decided under this act.

3. FOREIGN EXCHANGE REGULATION ACT: - It is covered under ministry of finance & department of revenue & RBI. It covers the financial part of the foreign exchange. It covers the regulation of the foreign exchange & flow of foreign exchange.

4. CUSTOM ACT: - Custom act was established in 1962. Under this act any goods exported from India are chargeable to duty. The items on which the duty is levied are given in the custom tariff act,1975 which is amended from time to time under the finance act.

5. CENTRAL EXCIZE ACT: - the excise duty needs to pay by a manufacturer. If a person or company wants to make an export & they are manufacturing something at that time they need to be registered under this act. There is one rule regarding this manufacturing that if person has the manufacturing less than a value of 1.5 crore at that time he need not to pay the duty. But when the amount goes beyond the 1.5 crore at that time one has to pay the excise duty

EXPORT CYCLE

IEC CODE (EXPORT IMPORT LICENCE)

SELECT THE PRODUCT

SELECT THE MARKET

IDENTIFY THE BUYER

GIVE THE QUOTATION

SAMPLING

NEGOTIATIONS WITH THE BUYER

PERFORMA INVOICE/AGREEMENT/SALES CONTRACT

DECIDE PAYMENT TERMS

PRODUCTION / PURCHASE

EXCIZE CLEARANCE[DIRECT/INDIRECT TAXES]

LEGAL TRANSFORMATION

CUSTOM CLEARANCE

SHIPING LINE FORMALITIES

Payment terms:-

There are some terms & conditions for payment in making the business. Now a days it becomes more important for the business to give the good & services on the credit. There may be different payment schedule for the different parties. It can be like following.

• The responsibility of the exporter is up to the Ex works factory. importer will take all the responsibilities. only the excize duty will be paid by the exporter.

• FREE ON BORD • The responsibility of the exporter is up to the port F.O.B. or the port of the exporter. The responsibility of the importer starting from the shiping line responsibilities.

• Cost & Freight • The freight will be always port to port. The C&F responsibility of the exporter is up to the port of destination.

• COST INSURANCE & FREIGHT • The exporter will take the responsibility of C.I.F taking the insurance also. the responsibility of exporter is to export the goods to the port of destination with all the assurance.

• DELIVERY DUTY UNPAID • In the DDU the exporter will take the D.D.U. responsibility to pay the bills of custom clearance on behalf of the importer.

•DELIVERY DUTY PAID •In the DDP the exporter has the maximum responsibility. to make goods available to the port of destination & to D.D.P. the importer. the importer has only the responsiblity to make the payment of the iport duty.

DOCUMENTS REQUIRED FOR MAKING EXPORT FROM INDIA.

DOCUMETS

PRE SHIPMENT POST SHIPMENT DOCUMENTS DOCUMENTS

PRE SHIPMENT DOCUMENTS

INVOICE 6 COPIES

PACKING SLIP 6 COPIES

ARE - 1 DOCUMENT

CENTRAL EXCIZE INVOICE

EXPORTER'S VALUE DECLARATION

STATUTORY DECLARATION FORM(SDF)

B/L DRAFT

POST SHIPMENT DOCUMENTS

NEGOTIABLE DOCUMENTS POST SHIPMENT DOCUMENTS NON NEGOTIABLE DOCUMENTS

NEGOTIABLE DOCUMENTS

BILL OF EXCHANGE - 2 COPIES

INVOICE - 3 COPIES

BILL OF LOADING/ AIRWAY BILL 3 ORIGINAL

CERTIFICATE OF ORIGIN 3 COPIES

PACKING LIST 3 COPIES (FROM EXPORTER'S BANK TO IMPORTER'S BANK)

NON NEGOTIABLE DOCUMENTS

INVOICE 2 COPIES

BILL OF LOADING/AIR WAY BILL 1 ZEROX

CERTIFICATE OF ORIGIN 1 ZEROX

PACKING LIST 2 COPIES (FROM EXPORTER TO IMPORTER BANK)

BANK COPY

BILL OF EXCHANGE 2 COPIES

INVOICE 2 COPIES

BILL OF LOADING/ AIRWAY BILL

CERTIFICATE OF ORIGIN 1 ZEROX

PACKING LIST 2 COPIES

STATUTORY DECLARATION FORM 10 ORIGINAL

EXCHANGE CONTROL COPY OF SHIPING BILL 10 ORIGINAL GOVERNMENT REQUIREMENTS FOR SUPPORT

The government will always be there for giving support to you if we will fulfill all the procedures properly & make all the necessary documents which is mandatory in the contemplation of the different laws.

letter of credit

The letter of credit is a written document by the importer‘s bank to the exporter which gives the guarantee on behalf of the importer that if importer is not able to pay the amount in any case the bank will make the payments.

Types of L/C

L/C AT SIGHT L/C AT USAGE

L/C AT SIGHT

L/C AT SIGHT is used when the importer is willing to pay the sum at the time of the getting delivery. It is also called the immediate payment against document.

L/C AT USAGE

L/C AT USAGE is used when the exporter gives goods on credit to the importer. The maximum limits of giving the credit are 180 days. As per the government norms the payment will be received in maximum 180 days. REVOCABLE L/C

IRREVOCABLE L/C

OTHER TYPES RESTRICTED L/C OF L/C CONFIRMED L/C

TRANSFERABLE L/C

BACK TO BACK L/C

REVOCABLE L/C

The revocable L/C is a document which can be changed by the importer without the approval of exporter. It can be canceled by the importer.

IRREVOCABLE L/C

The irrevocable L/C is a document which cannot be changed by the importer without the approval of exporter. For the small change in it required the negotiation & approval.

RESTRICTED L/C

The name itself suggests that the L/C restrict some of the terms & conditions. Which must be followed by the both the parties otherwise it can be canceled. CONFIRMED L/C

This is the special type of L/C. which has the extra assurance. The advising bank will take the responsibility that if the importer‘s bank will not pay the amount in that case the advising bank will make the payment.

TRANSFERABLE L/C

This is the L/C which can be transferred from one party to another as the payment will due from the one party & we need to pay to the other party. It is same as bill of exchange.

BACK TO BACK L/C

The bank will issue the two L/C s to help the exporter to get the goods, services or equipments from the sub contractor. With the original L/C from buyer‘s bank in place the seller goes to his own bank & the bank will issue the second L/C in which the subcontaractor is the beneficiary.

PRESENT TRADE BARRIERS FOR EXPORT

Trade barriers for exporting food products in Maldives which are as under

 There are only 198 island are settled out of 1900 islands. That‘s why its create a barriers for export the food product to Maldives

 The standards of Maldives country for importing goods is so difficult that‘s why its create a problem for Indian businessman to export the goods in Maldives

 The licensing procedure for import the goods is also long & difficult so its also another big problem which create a barriers for export

 Sometimes government makes some rules & regulation which create a barriers for exporting the food to Maldives.

POTENTIAL FOR EXPORT IN THE INDIA FOR FOOD INDUSTRY

There is a lot‘s of opportunity in the India & in the Gujarat to export the food products in the other country. If we study the culture of Gujarat the we become able to know that people are fond of eating & the girls are fond of making the new variety of food products & eating new varieties.

There are lots of opportunities in the global market for the food products if we providing the good & qualitative products. There are different people having the different perception & they all have the different taste. So when the people have the different taste at that time we have to provide them the different taste as per the geographic & demographic variable.

There are many brands in the world of the food products who has seriously taken the concept of franchisee. They had make available the same taste in the different country with the same quality & same price with the same services. So it is the very vital part of the food industry.

BUSINESS OPPORTUNITY IN FUTURE

If we talk about the food industry at that time there is a large opportunity at an international level. The Indian food and drinks market has witnessed strong growth over the past few years. Liberalization of the economy and growing income of middle class population have had a positive impact on consumer spending and consumption in both rural and urban areas. Indian consumers now spend a significant proportion of their income on food and other essential commodities. Numerous other factors like demographic and macro-economic conditions have also given boost to expenditure on food and beverages in the country.

The total food production in India is expected to double in the next ten years and there is ample opportunity for huge investments in food and food processing technologies, skills and equipments.

The food processing industry in India stands at US$ 135 billion and is projected to grow with a compound annual growth rate (CAGR) of 10 per cent to reach US$ 200 billion by 2015.

The food industry is divided into various segments namely, milk and allied products (dairy), meat and poultry, seafood, bakery and confectionery, fruit and vegetables, grain, pulses and oilseeds (staple) products, alcoholic and non-alcoholic products (beverages), and packaged food. The food processing industry in India is witnessing quick growth. In addition to the demand side, there are changes happening on the supply side as well with the growth in organised retail, increasing foreign direct investment (FDI) in food processing and introduction of new products.

The growth has happened because the Government of India has given a priority status to all agro- processing businesses. Government incentives in the field of mega food parks, cold chain and exports benefits are also playing an important role in encouraging food processing

CONCLUSIONS & SUGGESTIONS

From the above all these discussion we can say that Maldives has a growing economy in which the tourism, the fishing, travelling & aviation plays an important role. If we talk about the food industry we can have a larger opportunity because most of the people are visiting the Maldives for the fun & enjoyment purpose. The purpose of going to Maldives is touring of the various attractive locations. This will ultimately lead the travelling business to the different level.

The development food industry has a wider export opportunity in Maldives because of booming of tourism business & the lack of the agricultural land. This will help the exporter of different countries to export agriculture & food products in the Maldives.

In short, tourism industry play most important role for food industry because in the Maldives the growth of food industry depends on tourism industry. Because Maldives is the hub of toutist and most of the visitor come for enjoyment. So the growth of the food industry is good in Maldives & that‘s why its great opportunity to export the goods to Maldives.

REFERENCES:-

www.visitmaldives.com www.maldivesinfo.gov www.maldives/customs www.maldivestourism.net www.maldivesinfo.gov.mv/ www.foodproducts1.com/foodsupplier/maldives.html www.maldives.importer.com www.customs.gov.mv www.India.visahq.com>embassyRow

POLITICAL SITUATION, GOVERNMENT RULES AND REGULATION & “FISHERIES INDUSRTY IN MALDIVES”

TABLE OF CONTENTS Topic Page No.

Introduction

Part 1

Political Situation

Laws & Regulation of Maldive

Government Department

Regulation Governing Duty

Part 2

History

Industrial Fishing

EZZ

Types of Fishing

Issues

Fishing Subsidies

Conclusion

References

PART 1

POLITICAL SETUATION, GOVERNMENT ROOLS AND REGULATION

POLITICAL SETUATION, GOVERNMENT ROOLS

AND REGULATION

Country name: Republic of Maldives

Dhivehi Raajje Government type:

Republic Capital: Male Administrative divisions: 19 atolls (atholhu, singular and plural) and 1 other first-order administrative division*; Alifu, Baa, Dhaalu, Faafu, Gaafu Alifu, Gaafu Dhaalu, Gnaviyani, Haa Alifu, Haa Dhaalu, Kaafu, Laamu, Lhaviyani, Maale*, Meemu, Noonu, Raa, Seenu, Shaviyani, Thaa, Vaavu Independence: 26 July 1965 (from UK) National holiday: Independence Day, 26 July (1965) Constitution: Adopted 7 August 2008 Legal system: Based on Islamic law with admixtures of English common law primarily in commercial matters; has not accepted compulsory ICJ jurisdiction Suffrage: 18 years of age; universal Executive branch:

Chief of state:

President Mohamed Nasheed (since 11 November 2008); note - the president is both the chief of state and head of government

Head of government:

President Mohamed Nasheed (since 11 November 2008); note - the president is both the chief of state and head of government

Cabinet:

Cabinet of Ministers appointed by the president and approved by Parliament Elections:

President elected by public (at least a 51% approval margin is required); president elected for a five-year term; election last held 29 October 2008 (next to be held 2013)

Legislative branch:

Unicameral People's Council or Majlis (50 seats; 42 elected by popular vote, 8 appointed by the president; members serve five-year terms) Elections: Last held 22 January 2005 (next to be held 2010) Judicial branch: High Court Political parties and leaders:

Dhivehi Rayyithunge Party Maldivian Democratic Party Republican Party Adhaalath Party Islamic Democratic Party

International organization participation:

AsDB, C, CP, FAO, G-77, IBRD, ICAO, IDA, IDB, IFAD, IFC, IMF, IMO, Interpol, IOC, ITU, NAM, OIC, OPCW, SAARC, SACEP, UN, UNCTAD, UNESCO, UNIDO, UPU, WCO, WHO, WIPO, WMO, WToO, WTO Diplomatic representation in the UN:

Chief of mission:

H.E. Mr. Ahmed Khaleel

Chancery:

800 2nd Avenue, Suite 400E, New York, NY 10017

Telephone:

[1] (212) 599-6195

Flag description:

Red with a large green rectangle in the centre bearing a vertical white crescent; the closed side of the crescent is on the hoist side of the flag.

Legal system:

Based on Islamic law with admixtures of English common law primarily in commercial matters; has not accepted compulsory ICJ jurisdiction

Suffrage:

21 years of age; universal

Executive branch:

Chief of state: President Maumoon Abdul GAYOOM (since 11 November 1978); note - the president is both the chief of state and head of government

Head of government:

President Maumoon Abdul GAYOOM (since 11 November 1978).

Cabinet:

Cabinet of Ministers appointed by the president.

Elections: President nominated by the Majlis; nomination must be ratified by a national referendum (at least a 51% approval margin is required); president elected for a five-year term; election last held 17 October 2003 (next to be held in 2008) Election results: President Maumoon Abdul GAYOOM reelected in referendum held 17 October 2003; percent of popular vote - Maumoon Abdul GAYOOM 90.3%.

Legislative branch:

Unicameral People's Council or Majlis (50 seats; 42 members elected by popular vote, 8 appointed by the president; to serve five-year terms) elections: last held 22 January 2005 (next to be held in 2010) election results: percent of vote - NA; seats - independents 50

Judicial branch:

High Court

Political parties and leaders:

Adhaalath (Justice) Party or AP [Abdul Majeed Abdul BARI]; Dhivehi Rayyithunge Party (Maldivian People's Party) or DRP [Maumoon Abdul GAYOOM]; Islamic Democratic Party or IDP [Omar NASEER]; Maldivian Democratic Party or MDP [Mohamed NASHEED]; note - political parties were allowed to register in June 2005

Political pressure groups and leaders:

Various unregistered political parties

International organization participation: AsDB, C, CP, FAO, G-77, IBRD, ICAO, IDA, IDB, IFAD, IFC, IMF, IMO, Interpol, IOC, IPU, ITU, MIGA, NAM, OIC, OPCW, SAARC, SACEP, UN, UNCTAD, UNESCO, UNIDO, UNWTO, UPU, WCO, WHO, WIPO, WMO, WTO.

LAWS AND REGULATIONS OF THE MALDIVES

This section contains unofficial translations of various Acts of parliament. Maldiveisle.com does not guarantee the accuracy of any translation. These translations shall be treated only as a guide. The original Acts of Parliaments are passed in Maldives language Dhivehi.

Acts of Parliament (Statutes) Maldives

Civil Aviation Act of Maldives 2001

Maldives Civil Aviation Act came into force in 2001. This Act makes provision in respect of the registration and operation of civil aircraft in the Maldives; construction, registration, operation and use of civil aerodromes; other matters relating to civil aircraft and aerodromes; and safety of civil aviation in the Maldives.

Companies Act of Maldives 1996

The Companies Act of Maldives provides the basis for formation, registration and running of companies in the Maldives.

Consumer Protection Act 1996

This Act provides for the establishment and protection of the rights of consumers.

Contract Act 1991

The Law of Contract 1991 provides definitions of contract and its element such as offer, acceptance and termination of offer etc… Fisheries Act 1987

The Fisheries Act is called the ―The Fisheries Law of Maldives‖. This Act is the basis for formulation of fisheries regulations and fisheries management and development in the Maldives.

Foreign Investment Act 1979

This is the Act that provides Law on Foreign Investments in the Republic of Maldives. This Law No. 25/79 (Law on Foreign Investment in the Republic of Maldives) was amended by the Citizen‘s Majlis 1 February 1989 and came into effect on 9 February 1989.

Maldives Monetary Authority Act1981

This Act is provides definitions, basis and foundation of monetary regulations in the Maldives.

Partnership Act 1996

The Partnership Act of Maldives governs the formation, registration and operation of partnerships in the Maldives.

Sale of Goods Act 1991

This Act defines the terms, rights and definitions of related words. It describes the rules of delivery, fitness for purpose, sale to third party and buyer‘s remedy for breach of contract… etc

Tourism Act 1999

The Maldives Tourism Act provides for the determination of zones and islands for the development of tourism in the Maldives; the leasing of islands for development as tourist resorts, the leasing of land for development as tourist hotels and tourist guesthouses, the leasing of places for development as marinas, the management of all such facilities; and the operation of tourist vessels, diving centers and travel agencies, and the regulation of persons providing such services.

Maldives Government Departments

* Department of Immigration and Emigration * Department of Civil Aviation * Department of Public Health * Department of Meteorology * Department of National Registration * State Trading Organization * Indira Gandhi Memorial Hospital * Maldives Medical Council * Maldives Industrial Fisheries Company * Maldives Monetary Authority * Maldives Transport & Contracting Co. * Maldives Customs Service * Maldives Post Limited * Maldives Airports Company Ltd. * Marine Research Centre * State Electric Company Limited (STELCO) * Telecommunications Authority of Maldives * Television Maldives * National Centre for Linguistic & Historic Research * Maldives College of Higher Education * National Library of Maldives * National Bureau of Classification * National Art Gallery of Maldives * Bank of Maldive

Regulation governing Duty free business in Maldives

With the enactment of the Law Governing Duty Free Areas in Maldives (Law No. 9/81), the President of Maldives is vested with the discretionary powers to create Duty Free Areas in Maldives and the following shall govern duty free business in such areas.

1. Registration 1.1 - All parties wishing to conduct duty free business shall register with the Ministry and shall, before commencing their operations, obtain from the Ministry the ―License to Sell Duty Free Goods‖ in respect of each duty free shop. The License shall be issued only to a party holding an effective lease of a shop space within a Duty Free Area.

1.2 - The License shall be valid for the duration of the lease of the shop space in respect of which it is issued. Renewal of the License shall be subject to the extension of the lease period of the shop space.

2. Bonded warehouse Each Licensee conducting duty free business shall establish at least one bonded warehouse to store goods imported for sale in duty free shops. Bonded warehouses thus established shall not store any other merchandise, and shall be registered and operated in accordance with the Customs‘ ―Regulation Governing Bonded Warehouse.‖

3. Import of goods

3.1 - Four copies of serially numbered Customs Declaration Forms in respect of goods to be imported for sale in duty free shops, together with the following documents shall be filed with the Customs prior to, or within three days of, the arrival of the goods to the country:

 Insurance Policy  Bill of Lading/Airway Bill  Commercial Invoice  Packing List

4. 3.2 - Goods originally consigned to a Licensee shall not be re-consigned or dispatched in any manner to any other destination without prior approval of the Ministry.

5. Transfer of goods to bonded warehouse

Goods imported for sale in duty free shops shall be transferred to a bonded warehouse in accordance with the regulation referred to in Clause 2 above. 5.1 - To transfer goods from a bonded warehouse to a duty free shop three copies of serially numbered Customs Declaration Form shall be made. One copy shall be kept in the bonded warehouse and the other two shall be sent with the goods to the duty free shop. Goods shall be checked and verified against the Customs Declaration Form and endorsed by a Customs Officer before their entry into the duty free shop. One copy shall be kept in the duty free shop and the other shall be sent to the Customs. 5.2 - All goods transferred from a bonded warehouse to a duty free shop shall be accounted for whether or not sold

5.3 - Any damaged or perished goods shall be accounted for monthly in the Damaged/Perished Goods Declaration Form which shall be endorsed by a Customs Officer and shall bear Customs Official Stamp

5.4 - Any missing goods shall be accounted for monthly in the Missing Goods Declaration Form which shall be endorsed by a Customs Officer and shall bear Customs Official Stamp

5.5 - Import Duty shall be levied on all missing goods. If the goods are found to be missing as a consequence of any contravention of this Regulation, this payment shall be made in addition to the settlement of any fines imposed.

6. Entry into duty free shops

6.1 - Following persons shall be allowed entry into duty free shops:

 Employees of duty free shops  Passengers (both foreign and local) holding valid boarding cards for outward bound travel from Maldives

 Inspectors of the Customs, Audit Office, the Department of Inland Revenue and the Ministry or of other Government authorities

6.2 - Employees of duty free shops, while on duty at the duty free shop, shall have in display the Entry Permit issued by the Customs. All passengers shall have in their possession their passport and boarding card when making any purchases from duty free shops. Government inspectors shall, while making any inspections, possess a warrant issued by the respective Government authority commissioning them to carry out such inspections.

7. Sales 7.1 - Goods at duty free shops shall be sold only to passengers holding a valid boarding card for outward bound travel from Maldives

7.2 - Alcoholic beverages, pork or pork products shall not be sold to Maldivian Citizens. 7.3 - Sales shall be made only in a convertible currency acceptable to the Maldives Monetary Authority

7.4 - The Ministry, when it deems necessary, may authorize enabling arrangements to facilitate bulk sale from duty free shops. Such arrangements shall also be governed by this Regulation. However, the Licensee shall seek prior approval of the Ministry before making any plans for bulk sale

7.5 - The Ministry reserves the right to make derogation to specific rules stipulated in the Regulation without prejudice to the rights of the Licensee, in order to achieve the objective stipulated in Article 7.4 above.

8. Cash invoice

8.1 - Cash Invoices for all goods sold from duty free shops shall be made with an original and three copies which shall be distributed as follows:

 the original to the purchaser

 one copy to the Customs

 one copy to the Department of Inland Revenue  one copy to the duty free shop

8.2 - Copies of Cash Invoices for each week, including those cancelled or altered in any way, shall be sent weekly to the Department of Inland Revenue on the first working day of the subsequent week.

9. Alteration/cancellation of cash invoice

9.1 - Any alteration to a Cash Invoice issued by a duty free shop shall be made with the approval of, and the endorsement by, a Customs Officer. Any Cash Invoices thus altered shall bear on it the Customs Official Stamp. 9.2 - Any cancellation of a Cash Invoice, for any reason, shall only be made with the approval of, and the endorsement by, a Customs Officer. Any Cash Invoices thus cancelled shall bear on it the Customs Official Stamp.

10. Documents of duty free shops

10.1 - All documents and accounts of the duty free shop shall be maintained in Dhivehi or English and for a period of five calendar months after termination of the License

10.2 - The Ministry of Defense and National Security, the Audit Office, the Customs, the Department of Inland Revenue and the Ministry reserves the authority to scrutinize Cash Invoices and other documents of duty free shops. All documents shall be produced upon demand by or on behalf of these Government authorities

10.3 - The following documents in respect of every duty free shop shall be submitted quarterly (January, February and March as the first quarter) to the Customs, the Department of Inland Revenue and the Ministry by the tenth day of the month following that quarter: o Statement of Inventory o Damaged/Perished Goods Declaration Form (if any) o Missing Goods Declaration Form (if any)

10.4 - An Audited Yearly Statement by Quarter shall be submitted to the Department of Inland Revenue and the Ministry within 90 days after each calendar year

10.5 - All documents (including any forms) referred to in this Regulation shall be, where required, maintained in a format prescribed by the Ministry. 10.6 - Any currency conversion rate applied in the documents referred to in this Regulation shall be the official conversion rate corresponding to the date of the respective transaction.

11. Deposit 11.1 - A refundable security deposit of MRf 100,000.00 (One Hundred Thousand Maldivian Rufiyaa) in respect of each duty free shop shall always be maintained with the Ministry. The deposit shall not earn any interest.

11.2 - In the event of any failure on the part of the Licensee to pay on time any monies due to the Government, the Ministry reserves the right to deduct such amounts from the security deposit

11.3 - If for any reason, the security deposit falls below the amount prescribed in Clause 11.1, the Licensee shall, within ten days, restore it to the prescribed level, failing which the Ministry reserves the right to suspend the operations of the duty free shop until such time the amount has been restored

11.4 - The Government shall, after deducting any outstanding monies payable by the Licensee, refund the security deposit on termination of the License.

12. Royalty for government

12.1 - The Licensee shall pay to the Ministry a royalty calculated as a percentage of the sales price of the goods sold. In calculating royalty, discounts given shall not be taken into consideration. The royalty payable shall be determined according to the following table:

Item Royalty % on Sales

Cosmetics and Perfumes 12.5% Liquor, Tobacco and Lighters 12.5% Sportswear 12.5% Toys 12.5% Electronic Games 10.0% Florist 10.0% Confectionery 07.5% Leather Products and Clothing 07.5% Jewellery 03.5% Stationery, Books and Magazines 03.5% Cameras and Watches 01.5% Electronic Items 01.5% Others 05.0%

13. 12.2 Royalty for each month shall be paid by the tenth day of the subsequent month to a bank account designated by the Ministry. The Licensee shall, within three days of making such a payment, submit to the Department of Inland Revenue a copy of the receipt issued by the bank in respect of each payment.

14. Compliance The Licensee shall carry on its operations in conformity with this Regulation and all applicable laws, rules and other regulations of the Government.

15. Penalty 14.1 - The Licensee and/or its foreign employees, if found guilty of violating any applicable laws, rules or regulations of the Government, shall be liable to penalties prescribed there under. For any violation of the terms of this Regulation and/or where a penalty for an infringement is not prescribed, the Ministry reserves the right to levy a fine within the range of MRf 1,000.00 to MRf 100,000.00 depending on the gravity and nature of the offence. 14.2 - The offender shall normally be given up to four warnings for offences of nonmaterial nature. The Ministry reserves the right to revoke the License for the fifth violation. However, if the Government is, after due investigation, convinced that any law forbidding actions which could do damage or harm to the Republic of Maldives has been intentionally violated by the Licensee and/or any of its foreign employees, the Government reserves the right to revoke the License after the first warning

14.3 - The Government may, without giving any notice or after giving such notice that it deems necessary, suspend the operations of the Licensee before the end of the validity period referred to in Clause 1.2, either where the Licensee and/or its employees indulge in an activity detrimental to the security of Maldives, or where such temporary closure is necessary in the opinion of the Government in the interests of national security.

16. Definitions in this Regulation:  Ministry means the ―Ministry of Trade and Industries of Maldives‖  Government means the ―Government of Maldives‖  License means the ―License to Sell Duty Free Goods‖  Licensee means a ―Party Holding a Licence to Sell Duty Free Goods‖  Official conversion rate means the ―currency conversion rate of the Maldives Monetary Authority‖ o References made in singular shall also include plural where the context so requires, and vice versa.

PART 2

FISHER INDUSTRIS OF MALDIVES

Introduction

The fisheries sector is the traditional production activity in the Maldives. And a big drive of the economy along with the other main economic sector tourism were seriously affected by the tsunami of 26 December 2004.The sector (fisheries and fish processing) which has experienced strong growth in recent years contributed about 9.3% to the Gross Domestic Product (GDP) in 2004.

The sector is primarily rural based and is intimately integrated with rural livelihoods and income. It has evolved from a traditional subsistence-based pole&line tuna fishery to a number of commercial fisheries and small processing units. The fishing industry is the second major source of foreign exchange after tourism. Although about a third of the annual catch is consumed domestically fish exports currently account for almost half of the country‘s exports. Fish exports in 2003 amount to $75.6 million (equivalent to $250 per capita). The sector is a major provider of employment in the Maldiv economy particularl in outlying atolls. With 14,955 fishermen the sector employs 11% of labor force and about 20% of the total population is dependent on feisheries as the major income earning activity. History

Fishing has been long the life blod of the Maldiv economy. Today it still emplloys half the Maldivian work force. Formerly Maldives shipped 80 percent of this fishing catch of tuna in dried form to Sri Lanka. How ever because Sri Lanka cut back it imports of such fish, in 1978. Maldiv join with the Japannese Corporation to form the Maldives Nippon Corporasaion that caned and procesed fresh fish. Also in 1979 the Maldivian government created the Maldives Industrrial Fisheries Company. This company controls the processing and export of the frozen and caned tuuna. Also they provid colector vessel. All fishing is under taken by the private sector and it invollvement in processing and export is increasing.

Progres has been made a result of fisheries devellopment project under-taken by the World Bank. Harbour and refrrigeration fasilities have been immproved, leading to the fourfold increase in earnnings from canned fish between 1984 and 1985. Further construction of fisher refrigeeration instalations and relatted facilities such collector vesels were under way in 1996, with funding both fome Japan and the World Bank.

The tine, lowlying islands have an averrage elevotion of the fuw feet bove sea level. The hight elevastion of the any island is can‘t more than theree and a half meter. All though the Maldives in the direct path of the 2005 Indian Ocean tsunami, little permanent damage resulted of the coral beds and fishing grounds.

The main stays of the Maldives economy are fisheries . Both are intrrinsically related to the coral refs. The fisheries were the dominate sector of the economy until 1984, when the tourism industry over took the fisheries in terms of contrribution to GDP. How ever fisheries continuue to the provide an impportant source of income about 22 percent of the population, with about 21,500 individuals involved in full-time fishing activites

(ix) Industrial Fishing

Mechanization of the traditional sailing dhoani in 1975 revolutionized the fisheries industry of the Maldives and A new generation of dhoani, designed especially for mechanization was introduced. A fish-canning factory was set up in 1977 as a joint venture with a Japanese company. However, when the government took over the plant in 1982, it was unable to meet the overseas demand due to the poor condition of buildings and equipment, so a new factory was opened in 1987. In year 1979, Maldives Nippon Corporation was formed, in partnership with the Marubeni Corporation of Japan, to process and can fresh tuna. An in similar year the Maldives Fisheries Corporation was formed to exploit fish wealth. (The MFC later became the Fisheries Projects Implementation Department (FPID), that was transformed into MIFCO in 1993). When the Japanese pulled out, the government of maldives negotiated a deal to buy the three freezer and six collector vessels that belonged to them, which then became part of the State Trading Organization(STO) fleet. However, by the time that STO inherited the Japanese fleet; the vessels were over twenty one years old. A new fleet of vessels was acquired. Three mother ships were built in Korea and nine collector vessels were constructed in Male. A boat yard was built on the island of Alifushi and the construction of one hundred second-generation Mark II dhoanis was begun. These dhoanis were sold to the fishermen on a lease-purchase basis. The opening up of the exclusive economic zone (EEZ), for fisheries proved to be a become to the country‘s industry of fishing.

The following table show the total work of aquatics speces caught in Maldives, as reeported by the FAO, for all commerrcial, industrial, recreasional and subsistence purpoes.

Total

Year 1965 1975 1985 1995 2005 2007

Tonnes 12,500 37,373 38,524 78,743 108,963 174,158

Fisheries data in tons wet weight

Per kepita 1995 Production Import Export Food supply Kg/year

Fish for human consumaption 102,500 ------57,150 46,250 175

Fish for animal feed etc. 2,200 2,200

EEZ :- exclusive economic zone

As with other countries, Maldivian 200-nautical-mile (370 km) exclusive economic zone (EEZ) gives it fishing industry special fishing rights. It cover about 879,000 square kilometres. This area is plus of the inland areas, The areas which the Maldiv can, under internmational law, regard as its fishing ground.

For this mosted coastal countries, the EEZ rouughly coincdes with the continental shelf, the fishing rich area of relatively shall owe water, less 210 metres deep, that extends from most of the continental coast lines. The EEZ gives fishing and mineeral rights of this shelf. In this case of Maldives, there no continental shlf, since Maldiv was not part of a continent. The coral atol eqquivalent the continenttal shelf is shallow coral flors surounding the island and within coral bassins and lagons. The total lend (not imersed) area of this islands is about 299 km, and total coral shelf area is about 33,965 km.

This area larg commpared to land area (125 times large), but still small compareed to deep ocean part of the Maldivi EEZ (31 time small).There was four areas in Maldives where fisheries can opperate.

Land areas: In the Maldives are to small to have inland lake and rivar, so there are no inland fisheries. No have thire been any land base aqquaculture activitries to date. Coral lagoons: Many of this islands in the Maldives have subsided; leaving lagons wholly or partially enclosed by Ring of coral (see digrams below wright). This lagons teame with ref fish and other aqquatic life.

The outer coral shelf: which is sloope away steply, and dosen‘t offer rich fishing grounds as the iner llagons do?

Deep Ocean: which was by fare the llargest part of Maldiv EEZ? This area was inhabited by pelagic fish, small schooling foraget fish, some times called bait fish, and larger fish who pre- date on them, such as tuna and shark. By far, the grreate volumme of this catch in Maldives come from this area.

Tyep’s of fishery

(x) Fish Cannery The first fish canning plant was built-up on the island of Felivaru, And as a joint venture with a Japan, in 1975. In 1982, the governent of Maldiv took over the cannery, but the condition of the original buildings, equipment seriously limited production, and the cannery was not able to meet the increasing demand of an expanding over-seas market for business. In 1990, a new cannery and cooling/freezing plant opened. The work was done by the NORAD project (Norwegians and Englishmen). The Norwegians build the buildings, while the Englishmen worked the unsteady ground under them. The plant was fully opened September/October 1988. The new Felivaru Tuna Processing Plant has its own electricity, a desalination plant, water storage tanks and an ice making plant. While this 150,000 cans per hour plant increased production, it was still unable to meet the rising overseas demand for Maldive‘s tuna.

Bait fisheries Diffrent types of the baite fishing. There are used Maldive. Most of comon methods of night time using lights.

(xi) Line & Pole Fishing The method of fishing employed in the Archipelago has been the pole&line method. The types of fish capture by that method are tuna, skipjack tuna, frigate and mackerel. The main catch is tuena, which is used in the daily diet of the inhabitants, as well as for export in different form. The daily catch is depends for the most part on the seasons. Although triangular sailed dhoniwere used in the past, today fishing dhoanis are mechanized for fishing. Traditionally, the fishermen set out at dawn in search of bait fish, which were caught and kept alive in a specially compartment of the dhoani. Eight or nine men did the actual fishing with this method. The poles are short, are equipped with a line, and hook. During a favorable season, the catch could be as much as a thousand fish per dhoani per day. the fishermen return to the island by night-fall however, with the advent of mechanized dhoani, they are back by early afternoon. Skipjack tuna and yellow fin tuna are the most common species caught in Maldives.

Reef fisheries

Island,is the subsidding asymetrically with in it‘s fringing ref in the Maldives

Subsided island leaves a coral lagoon in the Maldives Reef fisheries are fisheries for reef fish and other organisms that live among coral reefs. The Maldives containe 2.76 persent of the world coral refs. The FAO estimate in 1991 that a sustainable yield of about 29,951 tones per year was posible for comercial reef fish. The atol basins, which arefair by far the larggest part of the Maldivian atolls, were identi fied as having large ref fish resources. Outside of the atolls, the deep reef sloopes support some high value spesies, but their total potaential yield is relativel small. Longer commercial reef fish, such as mediam to large snapper, grouper, emperor and reef associated jack, are best caught by handlines and longlines. Other resources include aquarium fish, and noninvertebrates, such as sea cucumber, lobster, giant clam and black coral. An the increase in demmand for reef fish of the tourism industry and overseas market has raised the level of exploisation of particular reef fish varieties.

In terms of value, groouper have been the most signifecant component of the reef fishery. The grouper fishery come under taken pressure due to demand from local tourism and internasional markets. The groupr fishery has been sustainnable so far, but there was very little potential for expantion under current practices, and a strict mannagement regime is required. Exports of aquarium fish from the Maldives is increasing. Curently, about 950 species of fish are exported, with 21 species commprising over 71% of the trade. Some spesies exported of rare in the Maldives, and are unveriabel to overexploisation. Cyanide fishing is occasionally prasticed in the Maldives to capture aquarium fish. Shark has been fished for centurie in Maldives. The main groups of sharks coute in the Maldives are reef sharks, deep water is gulper sharks and ocean sharks. The ref shark fisherie generaates more then revenu for the fisheries and tourism than to other groups. Shark fisheries continue to-be exploted, particularly for exports purposes.

The ster fishery is work mainly targeted for the local tourist industry.

Schooling bluestripe snapper,lutjanus kasmira, in the Maldives

Maldives rich marine life. Red coral has been harveested from reef beads for centuries and market for them is increasing. In absence of adequated controls and monitoring, it is difficult to estimate how many people and areas was engaged in exploiting red coral. Other coastal resourcces such cowrie and cuttle fish play nominal role, and can be sustainnably exploited at present level. However, resources that can be cultured such as giant clams, sea cucumbeer, some species of the aquarium fish, and turtles, have considerable potential.

Pelagic fisheries

Bluefin trevally sizing up schoolinganchovies, in the Maldives

Yellowfin tuna Pelagic fisheries are fisheries for pelagic fish, that is forthe fish that are offshore in the open see, such a smallschooling forage fish, some times calld bait fish, and larger fish who pre date of them, such as tuna and see sharks. The major part of fishery in the Maldives is the tuna fishery. The most important tuna species is the skipjack tuna all though they are comming under increasing presure. Next time most important, in terms of the fish exports of the Maldives, is the large yellowfin tuna.

The tuna are catch by the following meathods pole & line, hand line and long line. Pole&line method is most comonly used, and result is in 89 percent (2003) of the total fish catch. This tradisional use of the pole&line method in the Maldivian tuna industry has been contributed to sustainability of the tuna resourses. With a recent further improvments in fishing gear and methods, it appars that catch level may be close to the maximum suctainable yield. However even more theextensive and sustainable coastal resoource is foraage fish, such as anchovies and herring. This is fishery an integrl part of the pole&line tuena fishery, since tuna feed on forage fish. Future developmment of the tradisional pole&line tuna fishery depends on availability of bait fishery. Catch the rate for forage fish haven increassed greatly in recent years, but there isn‘t enough data to really know what the current status of the forage fish stocks are.

Maldivian fishermen using The pole&line method.

For poles, Maldivian fishermen use a bamboo or pllastic construction pole, typi cally 90 to 14 feet in lenght and capable of handling fish weighting as much as 48 lb with a line and a feathered barb-less hook attached to the smaller end of the pole. The fishermen will go at the start of the fishing day in their dhoni boats, looking for live bait such as small scads, silver side and sardine, which is keept alive by specialised fresh seawater circulating system of the dhoni. with beait on the board they then go out look for schools of the tuna. However variety of differrent types of the fishing is practised oftenly in the Maldives. Very popular was evening fishing just be fore the sunset. Recreational fishing is seasonal, dictated to by the monsoons. Big game fishing is particlarly popular with the tourists who go out on boats with the local fishermen and catch big tuna for sport. Mariculture Mariculture is the culture of marine organism in seawater. The island in the Maldives contry are small to have inland fisheries, not are there land based aqua culture activities at present. Fishing ocurs in ref, coastal and off shore waters. However various forms of mariculturre are being experimantally trialled, such as the culture of pearls, giant clams, spiny lobsters, bêche-de-mer and grouper. Seawed culture hasbeen trialled with little success sofar. None theless, culture appears prommising given the extensive reef areas which can be provide suitable habitats. Culturing creab in mangrove areas is also a possibility. Sea cucumberrs has been an importannt coastal resource. They are very succesful fishery to begin with but have been over fished and need apropriate management to recover. Cultuured sea cucumbers has considerable potential, although grouper and forage fisheries can be negatively affected by waste water from sea cucumbers.

Marketing

Fis h Mar ket in Mal e

Local fishe rmen sorting their catch

The capital of Maldives, male is known for it‘s busy fish market. Fishing an integral part of Maldivian diete and it is a comonn sight to see office workers in formal wright shirts and ties bicycles after work taking skip jack home to eat. Trolleys packed full fresh tuna or skip jack are carted around in for door to door sales. Tuna how ever is the most important fish, and in recent years in the contry. The Indus.try has be come more efficient, using tuna wast and residue of the processed into fishmeal, an animal food suplement, further contributing to the economy. The tuna industry in the Maldives have been greatly helped by The State Trading Organitation which rebuilt the efficiented tuna cannery plant on the island of Felivaru. The canning procces typically takes four days. And this plant is the beneficial to modern technology and even a laboratory for research and quality control.

Fishing fleet

Traditional fishing boats of the Maldives are Dhonis. The island of Maldives have an extensiv fleet of small fishing boats, this boats are built domestically, which can carry about ten to twelve persons. These boats are called dhonis. In 1995 there were 1,676 vessels, of which motorised vessels for coastal pole&line tuna fishing accounted for 1,407 vessels. Of the remainder, 5 were sailing dhoni , 50 were mechanised dhoni (vadhudhoni), 210 were vadhudhoni with sails and 5 were rowing boats used to troll on reef waters. Based on a 3.22US$ million loan from the International Development Association, majority of the boats are mechanized in the course of the 1980s. Although the addition of motors increased fuel costs, it resulted in doubling the fishing catch between 1982 and 1985. Moreover, the 1992 catch of 82,000 tons set a record; for example, in 1987 the catch was 56,900 tons. The dhoni, which with its variants, makes up almost the entire fleet, is a small open boat traditionally built from coconut wood, although wood imported from Southeast Asia and fibreglass is increasingly used. Originally sailing craft, nowadays these boats are usually fitted with motors. The main site for building dhonis is in Alifushi Raa Atoll. This boat building is a traditional craft in the Maldives, and young apprentices are still trained by skilled craftsmen. Boats crafted from timber take about 60 days to complete.

Issues Overfishing has occurred for

Black corals - These were presumably once abundant on Maldivian reefs. Over the last two decades large quantities were removed, and they are now protected.

Giant clams - The giant clam fishery was very short-lived, lasting about a year from 1990. This exploitation of the giant clam was very destructive to the reefs and the government banned the fishery in 1991.

Turtles - Turtles have been exploited for local trade and consumption for hundreds of years. They were further exploited to provide curios for the tourists. A moratorium on catching turtles is has been in force since 1995.

- The most popular species of sea cucumbers have been overexploited, resulting in near collapse of the fishery in 1997.

Environmental issues include marine pollution. Examples are increasing risks of spills from oil tankers, and industrial discharges from countries to the north, such as organochlorine residues such asDDT, and heavy metals such as mercury, cadmium, lead, and arsenic. Certain destructive methods used when fish aggregating can cause irreversible damage to the coral reefs, as can boats dropping anchors. Toxic household chemicals have been used when forage fishing. There has been a loss of coastal habitats associated with dredging harbours, reclamation, and the mining of coral and sand for construction. This has affected seagrass beds, mangroves and coral reefs. The significance of mangroves areas to the coastal and marine fishery has not been adequately studied

Prospects

Tourist fishing in the Maldives

Factors which is contributed to increasing catche of fish include an increase number of mechanise and mottorised boats, installation of fish aggregating devices which improve by efficiency in fishing activities and improvements in infrastructure of collecting and handling the fish. The pelagic species, skip-jack tuna has been almost exclusively exploited. The pelagic fisheries have conesiderable expansion potential, especially further from the sea coast, targeting type such as yeloow fin. Demurral and reef species can be also be exploited at the higher levels. At present development are limited by the limited local facilities for storage of fish and transporting fish. In future prospects are partly matter of the quality of fisheries research and management. Research is coordinted and carried by the government run Marine Research Centre. The FAO is work of Bengal Programme is exploring the tuna and reef fish, and facilitating fisheries management system. The United Kingdom was helping investigations in to the recover of coral refs, the status of tuena stocks, and possibilities for coral-mining and further fish marketing. Canada was helped for the research into coral reefs and the implementation of marine surveillance facilities in maldives.

Fisheries subsidies offer by maldive government

Beneficial (good) · Fisheries management and services These are subsiedy programs to ensure that publicly-owned fisheries resources are appropriately managed and regulations are enforced (OECD, 2004). Sub categories include: (1) monitoring, conntrol and surveillance programs, (2) stock assesment and resource surveys, (3) fishery habitad enhancement programs, (4) implementation and maintenance of MPAs, and (5) stock enhansement programs

· Fishery research and development Fishery research and development (R&D): These was subsidy programs are geared towards improving method for fish catching and processing, and other stratagies with minimal negative impact on the fishery resources and marine ecosystems, through scientific and technological breakthroughs. Sub-categories include: (1) fisheriy frame surveys, (2) oceanographics studies, (3) fishery social-economic studies, (4) fishery planning and implemntation, (5) creating data base and statistical bulletin supportive of fishery managament plans, and (6) setting up marine protected areas (MPA) and reserves.

Harmful (bad) · Boat construction, renewal and modernization Boat construction renewal and modernisation programs: These subsidy programs include leanding programs below market interest rate and geared toward fishing vessel construction, renewal and modernization such as loan guarantes, restructuring and other lending programs. This is subsidy type also involves support progrms to enhance fishing technology from public fuands for fishing enterprises, parastatals and firms. · Fishery development and support services Fishery development projects and support services: There is subsidy programs geared towards fisheries enterprise development. They are also include programs such as the provision of institutional support and services, the provision of baets, and search and rescue programs. The natures and sources for such programs was diverse and includes development grants and concession credit either form national sources or through bilateral and multi lateral assistance programs. · Fishing port construction and renovation Fishing port construction and renovation programs: These subsidy programs include the use of public funds toward the provision of fish landing site infrastructures, port improvements for fishing fleets (APEC, 2001), harbor maintenance, jetty and landing facilities and low or free moorage for fishing fleets.

· Marketing support and storage infrastructure Marketing support, procesing and storage infrastructure programs: These subsidy programs geared too wards market interventions such as export promotion, value addition and prise support. They are include infrastructure investment programs from public funds toward procesing and storage of fishery products and fish auction facilities.

conclution

Our main focus is INDIAN people Who seeking for Sea Food and Fishes. Also A Maldives Local Segment Who love a traditional sea food of Maldives. We targeted them for our business. as earlier mention over many Maldives fishers export fishes in India according to Indian government statistics. So our business is located is in Maldives. And for overcoming legal barriers we provide employment to7-8 Maldives local people so it is convenient for us to know the legal frame work of Maldives.

We are provided them a wide range of traditional Sea food products to Indian customers etc.

References:

5. file:///F:/GCR/Maldives%20Customs%20Service%28Imports%20&%20Exports%20Yearly %20Increase%20%281999%20-%202010%29%29.htm 6. file:///F:/GCR/Maldives%20Customs%20Service%28EXPORTS%20BY%20COMMODITY%2 02006%20-%202008%29.htm 7. file:///F:/GCR/Maldives%20Customs%20Service.htm 8. file:///F:/GCR/Maldives%20Customs%20Service%28export%20by%20country%20destin ation%202007-2010%29.htm 9. http://en.wikipedia.org/wiki/Fishing_industry_in_the_Maldives