RBI must balance the need for improving domestic bank credit demand and respond to lower inflation.
India's GDP growth for the current fiscal is expected to slow down to 4.8 per cent, a UN report has said, warning that the Covid-19 pandemic is expected to result in significant adverse economic impacts globally. The UN 'Economic and Social Survey of Asia and the Pacific (ESCAP) 2020: Towards sustainable economies' said that Covid-19 is having far-reaching economic and social consequences for the region, with strong cross-border spillover effects through trade, tourism and financial linkages.
India's economy grew 6.1 per cent in the fourth quarter of 2022-23, pushing up the annual growth rate to 7.2 per cent, official data showed on Wednesday.
IMF cut its 2016 global growth forecast for the fourth time in the past year to 3.2 per cent, citing China's slowdown.
As the COVID-19 pandemic continues to unravel in various parts of the country, the World Economic Forum on Monday announced the cancellation of its high-profile annual meeting for 2021 after postponing it at least twice along with two changes in venue. The next annual meeting will now take place in the first half of 2022, while the location and date would be determined after assessing the situation later this summer, said the Geneva-based organisation that has been hosting a yearly congregation of the rich and powerful from across the world in Swiss ski resort town of Davos for 50 years. This year's Davos summit was originally scheduled for January 2021, but was later moved to a different location in Switzerland, Lucerne, and then to Singapore with an August 2021 schedule.
Global growth, according to IMF, likely to be lower at 3.3%
The country's new economic roadmap highlights the importance of creating a virtuous cycle of investment, savings and exports in order to sustain rapid economic growth over the next five years.
India's likely medium-term potential growth will almost certainly be markedly lower than that experienced in pre-pandemic years, warns Shankar Acharya, former chief economic advisor to the Government of India.
Growth in emerging market and developing economies will slow to 4.4 per cent in 2014, before rising to 5.0 per cent in 2015, it said.
A new era of Indian equity market outperformance compared to China "appears to be dawning", according to Morgan Stanley. The firm has upgraded India to overweight in its Asia Pacific-excluding Japan (APxJ) list, making it their most preferred market not only in the region but also in the global emerging market (GEM) pack. India now holds the top position in this category, with an overweight of 75 basis points, a significant increase from nil previously.
The change in the latest Budget will impact the sale and rent of SEZ units of companies like Adani Port, which has large SEZs in Mundra.
The four key risk areas India needs to focus on at the moment include economic security, energy security, agriculture and food security and national security, it adds. The WEC-CII report says many issues facing India in these four areas will require considerable long-term investment from both public and private sectors. 'Decision-makers in government and business will be forced to make trade-offs as to where spending and investments are allocated,' it said.
While the economy seems to be on a firm growth path, the fight against inflation is not over yet. Shaktikanta Das seems to be in no hurry. After playing well through a five-year Test match, he doesn't want to get out hit wicket, observes Tamal Bandyopadhyay.
The sharp correction in the Indian markets from their peak levels has made valuations attractive, say analysts, who advise buying selectively, but only from a long-term perspective. Fifty-six of the Nifty 100 stocks, according to Mahesh Nandurkar, managing director at Jefferies, now trade below the 10-year historical averages, including stocks in financial, select auto, and pharma sectors. "Valuation (one-year forward consensus price-to-earnings, PE) has declined 25 per cent from October 2021 peak, almost matching the 33 per cent price-earnings contraction during the 2011 tightening cycle when repo rates went up by 375 basis points (bps) versus 250 bps this cycle.
However, India is likely to regain the tag of the fastest growth emerging economies of the world in 2018.
There is talk of a fresh approach to a new labour code as well as reforming land acquisition laws in such a way as to be politically.
'But unlike Bond who killed an individual, Israel is killing a nation.'
China, it said, is projected to grow at 6.6 per cent in the current year which will moderate to 6.4 per cent next year.
The members of Association of Southeast Asian Nations are Indonesia, Malaysia, the Philippines, Thailand, Vietnam, Brunei Darussalam, Singapore, Cambodia, Lao PDR and Myanmar.
The central bank maintained its bias towards a rate hike.
India Inc has weathered many a storm during Covid-19: from supply chain disruptions to demand dips, steep increase in input costs to shortage of key raw materials. As most companies navigated unprecedented challenges on multiple fronts, realisation dawned also about the criticality of employee welfare in the survival of the business. And it was the human resources (HR) department that faced the greatest test on this front.
Jaishankar, who arrived in Santo Domingo on his first official visit to the Dominican Republic, also said that India has seen a dramatic expansion in connectivity, contacts, and cooperation across the region.
The accelerating pace of digitalisation, fuelled by the COVID-19 pandemic, has led to a record-breaking year for cybercrime with ransomware attacks rising 151 per cent in 2021, and an average of 270 cyberattacks per organisation being faced, a new study showed on Tuesday. The World Economic Forum's 'Global Cybersecurity Outlook 2022', released during its online Davos Agenda summit, further said that each successful cyber breach cost a company $3.6 million (nearly Rs 27 crore) last year, while the average share price of the hacked company underperformed NASDAQ by nearly 3 per cent even six months after the event in case of the breach becoming public. The WEF said the global digital economy surged on the back of the COVID-19 pandemic, but so has cybercrime and nearly 80 per cent of cyber leaders now consider ransomware a 'danger' and 'threat' to public safety.
'There is a time for lowering one's expectations of the economy -- and therefore not trying to do too much in the Budget,' notes T N Ninan.
IMF said in 2017, India is likely to grow at the rate of 7.2 per cent instead of the earlier projected 7.6 per cent.
'Markets could face uncertainty in the short to medium term.' 'It would be prudent to invest in alternative asset classes, especially debt, for about a year.' 'Bank fixed deposits are offering rates as high as 9 per cent per annum and these can be used as a great hedging tool until equity markets stabilise.'
'Indian equity valuations, although not very expensive, are not cheap either.'
"We see the Indian economy rebounding from our projected 6.1 per cent growth this fiscal year to something like 7 per cent in the next fiscal year (2020). We see the factors that will support growth, including monetary policy stimulus, working their way through the pipeline," Jonathan Ostry, Deputy Director, Asia Pacific Department at the IMF, told reporters.
The biggest risk to India's growth outlook is an escalation of geopolitical tensions, especially if these tensions spread to the Asian region, RBI Monetary Policy Committee (MPC) member Jayanth R Varma said on Wednesday. Varma, in an interview to PTI, said that inflation and inflationary expectations appear to be moderating and high inflation will certainly not become the 'norm' in the country. He is cautiously optimistic about the Indian economy as after the pandemic abated, consumption demand has begun to recover though the recovery is uneven across sectors and industries.
It is a wonder how pervasive and long-lasting the damage can be from a balance-sheet crisis, says Suman Bery.
However, the Indian economy is expected to bounce back in 2021, the World Bank said.
India's historical focus on its continental borders has overshadowed its maritime ambitions, but that is changing quickly, notes Ajai Shukla.
In India, economic activity slowed substantially in 2019, with the deceleration most pronounced in the manufacturing and agriculture sectors, whereas government-related services sub-sectors received significant support from public spending, the Bank said.
2023 could be another volatile year for Indian equity markets, according to BofA. In a report, the brokerage pointed out that the Nifty50, at present, is trading at 20.7x against its long-term average of 18.8x one-year forward earnings of current Nifty constituents. Plus, India is trading at a 98 per cent premium to its emerging market (EM) peers against its long-term average of 45 per cent.
Reserve Bank will have to constantly re-assess the "dynamic and fast changing situation" and tailor its actions accordingly, Governor Shaktikanta Das said during the recent meeting of the Monetary Policy Committee (MPC) which decided to maintain status quo on key interest rate. According to the minutes of the six-member MPC meet released by Reserve Bank of India (RBI) on Friday, the five other members had also expressed a similar opinion amid the ongoing Russia-Ukraine conflict's impact on the global and domestic economies. MPC, which held its meeting from April 6-8, unanimously decided to keep the borrowing costs unchanged at a record low for the 11th time in a row in a bid to continue supporting economic growth despite inflation edging higher in the aftermath of Russia-Ukraine conflict.
In India to take part in a board meeting, Martin Sorrell, chief executive officer of WPP, spoke to Alokananda Chakraborty on a wide range of subjects.
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.
The Reserve Bank of India (RBI) on Wednesday raised the benchmark lending rate by 35 basis points to 6.25 per cent in a bid to tame inflation, which has remained above its tolerance level for the past 11 months. With the latest hike, the repo rate or the short-term lending rate at which banks borrow from the central bank now has crossed 6 per cent. This is the fifth consecutive rate hike after a 40 basis points increase in May and 50 basis points hike each in June, August and September.
Although as per the IMF-OECD estimates, an incremental growth of 1.8 per cent in global GDP is achievable
Navy chief Admiral R Hari Kumar on Monday flagged concerns over growing geo-political power play in the Indo-Pacific, and noted that the US-China rivalry in the region is likely to be a "marathon".
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