Earnings growth, attractive valuations and change in FPI flows from negative to positive over the next 12 months are some of the key triggers for an upside. "A poor monsoon, high inflation and further rate hike are some of the key risks
The Budget would preserve macro-economic stability.
All policy planners want low interest rate, says Jaitley
India's sovereign rating could be cut if the government loosens fiscal policy in the run-up to elections, says Fitch.
The much-delayed Foreign Trade Policy (FTP), which will roll out steps to boost exports, is expected to be unveiled soon.
In 2021, the Railways boasted of a historic feat -- no passenger deaths in train accidents in two years. However, the derailment of the Bikaner-Guwahati Express in 2022 brought the Railways back to its forgetful past.
The bigger worry is that its effects could linger well into the next financial year.
While the RBI, in the recent past, appeared keen to move to an inflation-targeting framework, industry and academia remain divided on this issue.
The Indian markets have seen a good run in the last three months with the S&P BSE Sensex rising around 7 per cent and the Nifty50 moving up 7.5 per cent. The next leg of the market rally from here on, analysts suggest, will be driven by a growth in corporate earnings over the next few quarters. That said, they do not expect material / sharp downgrades to India Inc's earnings estimates despite headwinds for the economy.
Fitch frowns at government pay hikes.
The Urjit Patel committee on monetary policy framework has proposed setting up of a monetary policy committee (MPC) that will be headed by the Reserve Bank of India (RBI) governor and accountable for achieving inflation target set by it.
With inflation remaining at elevated levels, central banks around the world, including the Reserve Bank of India (RBI), will kill excess demand in economy over the next six to eight months, sources in the know said. They also indicated that there could be a rate hike in June, when the inflation forecast for the current financial year would be raised. The RBI, the sources said, might announce more steps such as raising the limit on held-to-maturity (HTM) bonds to support government borrowings but might not come out with any further quantitative easing GSAP (Government Securities Acquisition Programme) measures.
Lower revenue collection puts upward pressure on government borrowing, ensuring that it deviates from the glided path of debt reduction
With India's exports touching $80 billion in 2004-05, government on Friday announced a slew of measures in the new Foreign Trade Policy, aimed at taking the exports to $92 billion in the current fiscal.
Per capita income has more than doubled to Rs 1.97 lakh in around nine years. Indian economy has increased in size from being 10th to 5th largest in the world in the past nine years. Seven priorities of the Budget, 'Saptarishi', are inclusive development, reaching the last mile, infrastructure and investment, unleashing the potential, green growth, youth power and financial sector.
Leading brokerages Nomura and Barclays on said current account deficit, which unexpectedly improved to 4.8 per cent in 2012-13, but still at a historic high, could moderate further this fiscal on slowing gold imports and cheaper commodities.
The government was considering further modifications in mega power projects policy, aimed at promoting capacity addition through fiscal incentives, Minister of State for Power Jaywanti Mehta told the Lok Sabha on Thursday.
Industry body Confederation of Indian Industry said with the government having announced a clear road map for fiscal consolidation and non-food inflation demonstrating a secular decline, conditions are conducive for RBI to have intervened with a repo and cash reserve ratio reduction.
The employment situation remains dire. Whatever can be done to promote greater low-skill employment should be pursued aggressively, advises former chief economic adviser Shankar Acharya.
Gerard Lyons, chief economist and group head of research, Standard Chartered Bank, says that much will depend on monetary and fiscal policies undertaken.
Without naming India, S&P said it expects that in regions where inflation already exceeds targets, or which are vulnerable to capital flight, central banks will be forced to raise interest rates.
Putin made these remarks on Thursday at a forum in Moscow organised by Russia's Agency for Strategic Initiatives (ASI).
Rating agency Moody's has described Budget 2007-08 as "largely unremarkable", as it disappointed businesses and the market's hope for meaningful economic reforms.
The current account deficit is the difference between inflow and outflow of foreign exchange.
The policy action plan being prepared for the new government does not see the immediate need for a fresh fiscal stimulus package, but recommends a new oil pricing formula and disinvestment of government equity in public sector undertakings in small doses.
The Indian economy recovered from the Covid-induced downturn during 2022 and is poised for further improvement in the coming quarters though downside risks emanating from geopolitical tensions, strengthening dollar and elevated inflation will continue. The positive trajectory in the growth trend and improved fundamentals will help the nation in neutralising the impact of global headwinds which are expected to have a bearing on the country's exports in the months to come. The challenges before the government and the Reserve Bank in the new year would be to arrest inflation, check declining value of rupee against US dollar and promote private investment and growth, with a view to ensure that the country remains one the fastest growing major economies of the world.
Liquidity will be tight and inflation would be about 4.4.5 per cent. In this scenario, the 10-year yield is unlikely to stabilise below 6.25 per cent.
There will be a lot to repair and rejuvenate -- if that opportunity even presents itself, warns Rathin Roy.
The proposed four per cent inflation target is onerous, considering India is currently battling near-double-digit increases in prices.
It would be a miracle indeed if we grow at 7/8 per cent a year over the current and next few years, says A V Rajwade
The ratings are opinions that reflect the ability and willingness of the rated entity to meet financial obligations.
Addressing bankers and economists at Bancon 2013, a flagship event of the Indian Banks' Association, Chidambaram told the lenders to deal firmly with wilful defaulters, but handhold those who are reeling under the impact of the economic slowdown.
Whether this remains under control in the coming months will depend on the future intensity and spread of the Russia-Ukraine war, and the effectiveness of the Indian government's response, points out A K Bhattacharya.
Domestic macroeconomic data, RBI policy and developments related to the Russia-Ukraine war would be major driving factors for the stock market this week, analysts said. Moreover, FPI investment and trends in crude oil would also influence the trading sentiment, they added. "This week, the RBI credit policy will be a critical factor for Indian markets.
The Bharatiya Janata Party on Tuesday hit out at the government for the recent hike in petrol prices and alleged that this increase is a result of the UPA regime's wrong economic policies and not an outcome of any current global situation.
Exports declined for the fourth-consecutive month by 10.3 per cent year-on-year to $34.98 billion in May, while the trade deficit widened to a five-month high of $22.12 billion. According to the data released by the commerce ministry on Thursday, key export sectors recording negative growth include petroleum products, gems and jewellery, engineering goods, ready-made garments of all textiles and chemicals. Imports also declined 6.6 per cent, six-month in a row, to $57.1 billion against $61.13 billion in the same month last year, the data showed.
Business houses expect rate cut in next RBI policy.
For 2014-15, the bill on this account is likely to be 12.8% more than in 2013-14.
Finance Minister Nirmala Sitharaman on Wednesday raised the personal income tax rebate limit, doled out sops on small savings and announced one of the biggest hikes in capital spending in the past decade as she did a tight rope walk in the Budget between staying fiscally prudent and meeting public expectations in the year before general elections.
In Q1, India's GDP shrank by a staggering 24 per cent year-on-year amid the imposition of one of the most stringent global nationwide lockdowns.
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