JP Morgan's decision last week to include Indian government bonds in its Government Bond Index-Emerging Markets (GBI-EM) index and the index suite from June 2024 may be a sort of blessing for India, as the move is estimated to result in an inflow of $25 billion of foreign portfolio investments into the country. The development comes at a time when the spread between the benchmark 10-year government of India bond and the 10-year US government bond has declined to its lowest level in more than 17 years. Low yield spreads make Indian bonds less attractive to foreign portfolio investors (FPIs).
'If they aim to remain aligned with the public sentiment, as any democratic government should, then they must respond. Why else would the prime minister have cut short his visit to Saudi Arabia? And why would he have instructed the home minister himself to travel to Srinagar to assess the situation firsthand? This suggests that something is indeed being planned. I am quite certain of that, although the exact form it will take remains to be seen.'
Modi visited over 55 countries in 48 foreign trips since taking over as prime minister in May 2014.
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.
Trumponomics, poor growth, and high valuation certainly don't make a bullish recipe for Indian markets, warns Debashis Basu.
In 2020-2021, the amount of foreign direct investment into India from China and Hong Kong plummeted to just $200 million -- its lowest in the recent past. In the first half of 2021-2022, FDI investments through these two nations stood at just $36 million.
Trump's sweeping tariffs and penalties on China-built ships have turned global shipping into the front line of economic war, observes Shyam G Menon.
According to the committee, single overseas investments of more than 10 per cent in a company should be considered as Foreign Direct Investment while those less than 10 per cent should be classified as foreign portfolio investment.
The steering committee on foreign direct investment has recommended enhancement of foreign direct investment limit in domestic airlines sector from 40 per cent to 49 per cent.
The net claims of non-residents on the country, as reflected in the net Index of Industrial Production, decreased by $12.8 billion to $296.2 billion on the back of a $10.6-billion fall in the value of foreign-owned assets for the quarter ended September, the Reserve Bank said on Tuesday.
Quarterly earnings from corporates, global trends, and trading activity of foreign investors will guide market sentiment this week, analysts said, adding that benchmark indices may face volatile trends. "The upcoming release of Q2 results will be closely watched, providing insights into corporate performance. "Meanwhile, the escalating tensions between Israel and Iran introduce a significant geopolitical risk, potentially leading to increased oil prices and market volatility.
Sectors which attract maximum foreign inflows include services, computer software and hardware, telecommunications, automobile and trading.
Senior officials of India and the US will meet after the forthcoming Budget session to identify and prioritise sectors for investments and technology sharing.
Putin made these remarks on Thursday at a forum in Moscow organised by Russia's Agency for Strategic Initiatives (ASI).
The talks for a free trade agreement (FTA) between India and Canada may have taken a pause but will resume once the political row between the two countries is resolved as the pact has economic benefits for both the nations, trade experts and exporters said on Friday. However, they said that India may not hurry for the trade agreement as 60 per cent of New Delhi's exports are already entering Canada at zero duty. Earlier this month, India and Canada paused the negotiations for the agreement due to political reasons.
Foreign direct investment (FDI) equity inflows into India contracted by 16 per cent to $43.17 billion during the April-December 2021 period, according to data from the Department for Promotion of Industry and Internal Trade (DPIIT). The inflows had stood at $51.47 billion during the corresponding period of the previous year. The total FDI inflows (which includes equity inflows, re-invested earnings and other capital) aggregated at $60.34 billion during the nine month period of the current fiscal year as against $67.5 billion in the year-ago period.
RBI norms on foreign control of corporations will clear the air.
The UK's 697 projects created a 1.4 per cent rise in foreign direct investment jobs to 30,311.
Earlier, the Reserve Bank of India was the approving authority.
'A dynamic bond fund acts like a gilt fund in a rate cut scenario and like a conservative short-term bond fund when rates rise.'
Among its suggestions to the finance ministry, RBI has also said the government should classify private equity under a separate category of foreign investment, or create sub-limits within foreign direct investment or investments by foreign institutional investors.
Billionaire Mukesh Ambani's Reliance Industries has signed a pact to invest an undisclosed amount in a giant petrochemical hub being built in the UAE. The oil-to-telecom conglomerate will join the recently-formed Ta'ziz joint venture of Abu Dhabi state energy giant Adnoc and state holding company ADQ for developing the Ruwais Derivatives Park in western Abu Dhabi. A company statement said an agreement has been signed for Reliance to invest in the project but did not give details. Unconfirmed reports put the investment at about $1.5 billion.
FDI in the defence sector during 2000-2014 has been a meagre $4.94 billion, despite the total FDI flow into the country across sectors standing at $321.81 billion.
China has defended its plan to build the world's largest dam on the Brahmaputra River in Tibet, assuring that the project will not affect riparian states and safety issues have been addressed through decades of studies. The dam, estimated to cost USD 137 billion, has raised concerns in India and Bangladesh, but Chinese authorities maintain that the project has been thoroughly studied and safeguards are in place. The dam is part of China's efforts to develop clean energy and respond to climate change.
The major driver of Mod's foreign policy can be gauged from his economic priorities such as creating employment opportunities for the youth bulge. Related to this is emphasis on manufacturing, and infrastructure development, which in turn raises the issue of FDI. He has already articulated his views on all these issues, says Rup Narayan Das.
Foreign investment capped at 49 per cent.
China will open up service sectors such as education, finance and culture for FDI to remain an attractive destination for overseas investment.
Encouraged by foreign exchange reserves touching record levels, the Reserve Bank on Tuesday doubled the annual overseas investment ceiling for individuals to $2,50,000.
'He will be remembered more for what he did as finance minister -- as someone who functioned well when the political fallout was taken care of.'
As against a flow of nearly $3 billion in the preceding quarter of Jan-March, the direct and portfolio investments flow together rose sharply to $15 billion during April-June this year, data released by RBI revealed. Of the total investment flows during the quarter, portfolio investments accounted for $8.270 billion, while direct inflows contributed $7.016 billion to the total flows, Reserve Bank data showed.
FDI into the country increased by 30 per cent to $21.62 billion during April-September this fiscal.
Domestic institutional investors (DIIs) have infused a record Rs 4.6 trillion into Indian equities over the course of Samvat 2080, marking the highest net annual investment in any Samvat to date. This robust domestic inflow has effectively counterbalanced the comparatively subdued investments from foreign portfolio investors (FPIs), who contributed a net Rs 90,956 crore within the same timeframe. Against this backdrop, the Nifty 50 and BSE Sensex indices are on track to achieve their best performance in three Samvat years, despite recent market corrections.
The Delhi high court on Friday sought the stand of news portal NewsClick and its editor-in-chief on a plea by the Enforcement Directorate (ED) seeking vacation of an earlier order granting them protection from coercive action in a money laundering case.
India's current account deficit narrowed to $1.3 billion or 0.2 per cent of GDP in the January-March quarter of FY23, mainly due to moderation in the trade deficit and a robust increase in services exports, RBI data showed on Tuesday. However, for the 2022-23 fiscal, the current account balance recorded a deficit of 2 per cent of GDP compared to 1.2 per cent in 2021-22. "India's current account deficit (CAD) decreased to $1.3 billion (0.2 per cent of GDP) in Q4:2022-23 from $16.8 billion (2.0 per cent of GDP) in Q3:2022-231, and $13.4 billion (1.6 per cent of GDP) a year ago [Q4:2021-22]," as per the RBI's 'Developments in India's Balance of Payments during the Fourth Quarter (January-March) of 2022-23'.
