Several speakers noted that Budget carried the weight of expectations.
.jpg)
The basis of Ind-Ra's expectation of INR appreciation is based on economic developments in the last one to two months of this fiscal and the likely developments in the remaining months.
The World Bank on Tuesday projected India's economy to grow at 8.3 per cent in 2021 and 7.5 per cent in 2022, even as its recovery is being hampered by an unprecedented second wave of the COVID-19, the largest outbreak in the world since the beginning of the deadly pandemic. The Washington-based global lender, in its latest issue of Global Economic Prospects released here, noted that in India, an enormous second COVID-19 wave is undermining the sharper-than-expected rebound in activity seen during the second half of Fiscal Year 2020/21, especially in services.
With economic activity still to reach pre-pandemic levels, the RBI may slow down the pace of rate hikes until next year to quell soaring inflation while supporting growth, the Asian Development Bank (ADB) says in its latest report. The Manila-based multilateral funding agency has raised the inflation forecast for the current fiscal year ending in March 2023 to 6.7 per cent from its earlier projection of 5.8 per cent. For the next fiscal year too, the forecast has been revised upwards to 5.8 per cent from 5 per cent earlier.
This is the fourth consecutive time that the RBI has kept key interest rates unchanged despite clamours from the industry to cut rates to boost economy.
The Reserve Bank on Friday retained the inflation forecast for 2023-24 at 5.4 per cent, and vowed to take timely measures to prevent any spillovers of global food and fuel price shocks. Stressing that the Reserve Bank has identified high inflation as a major risk to macroeconomic stability and sustainable growth, Governor Shaktikanta Das said the September retail inflation number may be lower than August and July prints. The headline inflation based on Consumer Price Index (CPI) moderated to 4.6 per cent in first quarter of 2023-24 as compared to 7.3 per cent in the same period a year ago.
Foreign direct investment into the country is expected to rebound in the coming months on account of India's high economic growth, and steps to further improve the business environment of India, the Economic Survey said on Tuesday. The rise in global uncertainty in the wake of the Russia-Ukraine conflict, FDI equity inflows in the manufacturing sector in the first half of the current fiscal (April-September) fell below its corresponding level in the first half of 2021-22, the document, which was tabled in Parliament, said. The monetary tightening at the global level has further restricted the FDI equity inflows, the survey said.
Highlights of the RBI monetary policy.
The International Monetary Fund (IMF) has said the tightening of monetary policy by India is an 'appropriate' step, as the country is faced with high inflation and needs to consolidate the fiscal measures initiated during the slowdown.
For current financial year, govt plans to borrow Rs 2.88 trillion in the first half of 2018-19, out of Rs 6.05 trillion planned for entire year
The government on Monday hit out at bureaucracy for not keeping pace with policy changes and promised not to take recourse to borrowings
The Reserve Bank of India will release its review of economic developments in the fiscal year ended March 31, 2005 at 5:30 p.m. on Wednesday, an official spokesperson said.
India's economy is likely to grow by 12 per cent in 2021 following a 7.1 per cent contraction last year, as near-term prospects have turned more favourable, Moody's Analytics said. A stronger than expected December quarter GDP growth of 0.4 per cent following a 7.5 per cent contraction in the previous three months has turned India's near-term prospects more favourable, it said. Domestic and external demand has been on the mend since the easing of restrictions, which has led to improved manufacturing output in recent months.
India's exports are expected to touch $360 billion in the current fiscal from $312.35 billion in 2013-14, Federation of Indian Export Organisations (FIEO) said.
Amid expectations that the Reserve Bank may keep its monetary stance unchanged, the central bank will come out with its second quarter review of the credit policy for the current fiscal on October 27.
Following are the highlights of the Economic Survey 2022-23 tabled in Parliament on Tuesday
Prime Minister Narendra Modi made a pitch for electing a strong and stable government in an uncertain world beset by geopolitical tensions as the Bharatiya Janata Party on Sunday released its manifesto, prioritising development and welfare while shunning populist measures and contentious issues like the National Register of Citizens (NRC).
RBI unsure whether to cut rates or not in its next monetary policy.
India's economy is estimated to contract by 9.6 per cent in the fiscal year 2020-21, reflecting a sharp drop in household spending and private investment, and the growth is expected to recover to 5.4 per cent in 2021, the World Bank said on Tuesday. In its Global Economic Prospects report, the World Bank said that the informal sector, which accounts for four-fifths of employment, has been subject to severe income losses during the COVID-19 pandemic.
India will have to devise policies to ensure overall growth in FY16.
The agency has predicted that monsoon will also be a major factor.
It took three years of collective fiscal profligacy and policy mismanagement to cause this crisis.
The wholesale price-based inflation eased to a 29-month low of 1.34 per cent in March on easing prices of manufactured products and fuel items, even though food articles turned expensive.
The SBI report, however, said the economic growth rate will pick up pace in 2020-21 to 6.2 per cent.
The Reserve Bank of India on Thursday opted for a pause second time in a row, maintaining key benchmark policy rate at 6.5 per cent as inflation moderates. The rate increase cycle was paused in April after six consecutive rate hikes aggregating to 250 basis points since May 2022. Announcing the bi-monthly monetary policy, RBI Governor Shaktikanta Das said the Monetary Policy Committee (MPC) unanimously decided to keep the rate unchanged at 6.5 per cent.
Bold reforms and prudent monetary and fiscal policies by the incoming Narendra Modi government will help the economy to grow at 6.5-7 percent, says a report.
What might be useful is targeted assistance to those sectors and individuals that are disproportionately affected, suggests Mihir S Sharma.
Rejecting arguments of "policy paralysis", Chidambaram said the economy is more stable than what it was two years.
The BJP is the preferred choice because it offers what the Mughals and later British offered in their time: A stable polity and an environment in which business could function, explains T N Ninan.
Retail inflation rose to three-month high of 4.81 per cent in June, mainly on account of hardening prices of food, according to the government data. Inflation based on the Consumer Price Index (CPI) stood at 4.31 per per (revised upward from 4.25 per cent) in May and 7 per cent in June 2022. The inflation, however, remains within the RBI's comfort level of below 6 per cent.
India's fiscal policy is not supportive of monetary measures that the country's central bank is employing to fight rampant inflation, the prime minister's honorary economic advisor and former International Monetary Fund chief economist Raghuram Rajan said, while singling out the proposed Food Security Bill as a particular cause for concern.
The economic growth is likely to moderate to 6.1 per cent, slowest in over seven quarters, from 6.6 per cent last year same period.
Stating that a weak fiscal position continues to constrain India's sovereign ratings, Fitch said the next government's medium-term fiscal policy will be of particular importance from a rating perspective.
Prices may go up because of higher energy costs, caused by the rise in shipping charges, with commercial vessels taking a longer route to avoid the troubled Red Sea region, the finance ministry said on Monday. Iran-backed Houthi rebels of Yemen are repeatedly attacking ships in the Red Sea. While the global economy is grappling with challenges such as sticky inflation, sluggish growth, and mounting fiscal pressure, India's external sector could face "potential risks" due to the ongoing geopolitical tensions, according to the finance ministry's report on the review of the Indian economy.
Less-than-expected rainfall and a poor spatial distribution, experts say, can rekindle fears of a rise in food and fuel inflation that can have an impact on the RBI's monetary policy. The fear of less than optimal rainfall due to El Nino this year, analysts believe, is the biggest short-term risk for the markets, which they said has not been fully priced in yet by them. Monsoon set over Kerala on June 08, a week later than its scheduled date.
One of the major contributors for the decline in growth will be the monsoon deficiency, which also affects non- agricultural sectors through demand effects, RBI report said.
The government on Monday said that the stimulus packages to perk up the economy during the slowdown are not likely to be withdrawn this fiscal and the exit when it happens will be a gradual one.
NITI Aayog vice chairperson Rajiv Kumar tells Indivjal Dhasmana that additional funds could be generated through divestment, and that the fiscal deficit should be widened while focusing on the revenue deficit.
These are valuable suggestions and one hopes the Budget will make a start on that.
The mutual fund industry continued with the positive momentum in the September quarter, attracting Rs 34,765 crore, although it was a massive reduction as against the Rs 1.85 lakh crore inflow in the preceding quarter, primarily due to withdrawal from debt segment. Most of the asset classes saw net inflows during the July-September period of the current financial year barring the fixed-income or debt segment, which witnessed net outflows. Overall, flows started on a strong note during the quarter under review, with net inflows of Rs 82,467 crore in July, which dipped to Rs 16,180 crore in August and ended with a disappointing Rs 63,882 crore of net outflows in September, according to a report by Morningstar India.
© 2026 Rediff.com - Advertise with us - Disclaimer - Privacy Policy - Sitemap - Feedback - About us - Terms of use - Grievances