Thirteen companies have joined the Rs 1-trillion-plus market capitalisation club this year, so far. This even as the benchmark Sensex has gained less than 3 per cent on a year-to-date basis, underscoring the bullish undercurrent in the broader market. The trend shows a harsh second wave of Covid-19, subsequent lockdowns, and hit to the economic activity has made little dent into India Inc or shareholders' wealth. At the start of the year, there were 29 companies with a market value of more than Rs 1 trillion.
The survey, however, said that GDP is expected to revert to growth terrain next year, when it is likely to grow by 7.2 per cent.
Equity strategists are basing their expectation on strong corporate earnings recovery, supportive global economic growth, and gradual improvement in business sentiment.
Retail inflation has eased from double digits in 2013.
It is impossible for anyone to explain how markets are hitting record highs during an economic recession. It is both mysterious and surreal, notes Debashis Basu.
Comparative to other Asian GDP growths, India would have the fastest economic expansion, it said
'The numbers are null and void now. Look, we can give out projections now, but we know that a week later those numbers will also be irrelevant. So we need to wait,' a top government official said.
Top losers in the Sensex pack included IndusInd Bank, Yes Bank, SBI, L&T, Tata Steel, M&M, Bajaj Finance, Vedanta, Tata Motors and RIL, tumbling up to 6.97 per cent.
With domestic retail fuel prices jumping to record high on rising international oil rates, India on Thursday pressed oil cartel OPEC for 'affordable' oil price within a 'reasonable band' and that the producers should phase out production cuts. OPEC nations such as Saudi Arabia have traditionally been India's principal oil source. But, OPEC and its allies, called OPEC+, ignoring its call for ease supply curbs had led to the world's third-biggest oil importer tap newer sources to diversify its crude oil imports. As a result, OPEC's share in India's oil imports has dropped to about 60 per cent in May from 74 per cent in the previous month.
Th report predicted that the world population is to reach eight billion by mid-November 2022.
'How low GDP would have been, we don't know.' 'It raises serious questions because so many indicators are pointing to such a sharp decline and GDP estimates are still showing 4 per cent growth.'
Even as both India and the world struggle to re-build after COVID-19, they face slow-burn problems that could develop into full-blown crises, observes T N Ninan.
The uncertainty created by the jump in COVID-19 infections and localised lockdowns prompted RBI Governor Shaktikanta Das and other members of the rating setting panel MPC to unanimously vote for status quo in interest rates and an accommodative policy stance to support growth, as per minutes of the meeting released on Thursday. "The need of the hour is to effectively secure the economic recovery underway so that it becomes broad-based and durable," the Governor said during the three-day meeting of the Monetary Policy Committee (MPC) which ended on April 7. The renewed jump in COVID-19 infections in several parts of the country and the associated localised and regional lockdowns add uncertainty to the growth outlook, he observed, as per the minutes of the meeting released by the central bank.
The Reserve Bank of India on Friday decided to keep the benchmark interest rate unchanged at 4 per cent but maintained an accommodative stance as the economy is yet to recover from the impact of the second Covid wave.
UBS, Credit Suisse see emerging markets doing well next year, but expect India to underperform, given its rich valuations.
Tata Steel was the top loser in the Sensex pack, shedding 3.01 per cent, followed by M&M, Maruti, Asian Paints, PowerGrid, ITC and Axis Bank.
Let's take a look at how India and world's major economies will perform in the next four years.
The economy could grow at 6-6.5 per cent this fiscal year (2019-20 or FY20), said Chief Economic Advisor Krishnamurthy Subramanian, revising his earlier estimate of 7 per cent in the Economic Survey. In an interaction with Arup Roychoudhury, he said supply-side measures, including corporation tax cuts, will boost consumption and demand, and non-tax revenue may make up for shortfall in tax revenues.
A likely easing in inflationary pressures in the forthcoming months will reopen the window for the RBI to once again prioritise growth and ease its interest rates.
Microsoft co-founder Bill Gates, whose foundation has been part of the effort to develop and deliver COVID-19 vaccines, has warned that the next four to six months could be the worst of the coronavirus pandemic.
From the 30-share Sensex pack, 23 scrips declined in Wednesday's session, led by IndusInd Bank, Bajaj Finance, Tata Motors and Tata Steel which fell by up to 3.87 per cent.
The agency welcomed the Rs 1.70-lakh crore package announced by Finance Minister Nirmala Sitharaman earlier in the day but said more measures like loan forbearances for small businesses and households are necessary.
A report published in British journal The Lancet reckons India's working population will surpass China's in the mid-2020s.
In all, RBI has cut interest rates by 110 bps this year. But this has not yet led to a boost in economic activity. While the growth rate has slowed to a five-year low, consumer confidence is waning and foreign direct investment has plateaued.
'This is a period of significant uncertainty, of unknown unknowns.'
Fitch Ratings director Thomas Rookmaaker said India's debt-to-GDP ratio is likely to rise to 76 per cent from 70 per cent currently due to wider fiscal deficit and low economic growth.
Inflation is on a declining trend, Eco Survey stated.
Moody's Investors Service on Friday said India's economy is expected to contract for the first time in more than four decades saying economic damage owing to the coronavirus-induced lockdown will be significant with lower consumption and sluggish business activity. Even before the coronavirus outbreak, Indian economy already was growing at its slowest pace in six years and with the stimulus measures announced by the government falling short of expectations, the disruptions are likely to be greater. "We now expect India's growth to register a real GDP contraction for the fiscal year ending in March 2021 (fiscal 2020-21), from our earlier projection of zero growth," it said in a research note.
As many as seven of eight core industries saw a contraction in output in September.
The RBI is understood to be dithering since it would want more clarity on the cost of the fiscal policies the new government would undertake before it decides to cut rates, even though it has pencilled in a lower gross domestic product growth rate for this fiscal year.
If it doesn't do that, what Uddhav Thackeray postpones addressing today will be there on the table to confront, for whoever anchors the Sena in the years ahead, observes Shyam G Menon.
The global lending agency also said that Brexit has resulted in global economic uncertainty.
The country's gross domestic product (GDP) growth is likely to be 8.8 to 9 per cent in the current financial year, driven by agriculture and industry sectors, Care Ratings said in a report. The country's economy had contracted by 7.3 per cent in fiscal 2020-21. The agency said the outlook for the Indian economy on almost all counts in FY22 would look seemingly better than FY21 on account of the negative base effect.
The next policy meeting will be in mid-June, when the panel will be joined by Stanley Fischer, the former Bank of Israel governor whose nomination to the Fed's board was confirmed on Wednesday by the US Senate.
Growth projections for 2013-14 has been arrived at by taking into account present internal and external factors.
'When growth drops precipitously from 7% to 4.5% in four quarters, it is for all practical purposes a recession' notes T N Ninan.
Underlining that years of economic stagnation have given way to a "roaring geyser of opportunity", Trump said, "I knew that if we unleashed the potential of our people, cut taxes, slashed regulation, fixed broken trade deals and fully tapped American energy that prosperity would come thundering back ... and that is exactly what happened."
The London School of Economics professor Danny Quah forecasts that by 2050 the world's economic centre of gravity, a theoretical measure of the focal point of global economic activity based on GDP, will have shifted eastwards, as quoted in the Wealth Report 2012 by Knight Frank & Citi Private Bank.
The career bureaucrat-turned-central banker walked into the 19th floor corner room of the Reserve Bank on December 12, 2018. Since February 2019, the Das-led RBI has cut the repo rate by a whopping 135 basis points to support the sagging growth, including an unprecedented 35 bps reduction in August. As he completes one year at the helm, woes in the NBFC sector, overall health of the banking sector and steeply falling economic growth are among the major challenges that needs to be tackled sooner than later.
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The agency also warned the government of overshooting the fiscal deficit target at 4.8 per cent due to poor revenue growth and pegged it at 5.2 per cent this fiscal.
