# World Economy Slowed as India's GDP Slightly Fell in 2012-13 in USD terms



## RiazHaq

Haq's Musings: India's GDP Shrank to $1.84 Trillion in 2012-13 in US Dollar Terms

Sharp fall in Indian currency against the US dollar and slower economic growth have caused India's GDP for Fiscal Year 2012-13 to shrink in US $ terms to $1.84 trillion from $1.87 trillion a year earlier. The Indian rupee has plummeted from 47.80 in 2012 to 54.30 to a US dollar in 2013, according to Business Standard. Since this report was published in Business Standard newspaper, Indian rupee has declined further against the US dollar to Rs. 59.52 today. At this exchange rate, India's GDP is down to $1.68 trillion, about $200 billion less than it was in Fiscal 2011-12. 






Indian GDP Growth Rates 2004-2013
India's economy grew by 5.0% in 2012-13, its slowest annual rate in a decade, down from 6.2% last fiscal year,. In the fourth quarter ending in March, gross domestic product grew by 4.8% year-over-year, slightly higher than the previous quarter when it expanded by 4.5%, according to Indian government data.
In the January-March quarter, the manufacturing sector increased output by just 2.6%, while production in the country's mines shrank by 3.1%. 

Global ratings agency Standard and Poor's warned in May that India faces at least "a one-in-three" chance of losing its prized sovereign grade rating amid new threats to economic growth and reforms. India's BBB-minus investment rating is already the lowest among BRICS and cutting it to "junk status" would raise the country's hefty borrowing costs. The Organisation for Economic Cooperation and Development (OECD) this week lowered its projection of India's GDP growth this year to 5.3%, from 5.9% earlier. 






Meanwhile, Pakistan's economy continues to struggle with its annual GDP rising just 3.6% to $252 billion in fiscal 2012-13, according to Economic Survey of Pakistan 2012-13 estimates based on 9 months data. The country is facing military and energy shortages impacting its economy.

Other world economies have also slowed down. US is slowly recovering but Europe is still struggling. BRIC growth rates are also slowing. China is slowing with its workforce aging and shrinking. In India, the slow pace of reform is hurting its growth, and Brazil and Russia are struggling with slowing demand for their export commodities.

Africa has replaced Asia as the continent with most of the world's fastest growing economies, according to The Economist magazine. The top 10 fastest growing economies in the world are: Macau, Mongolia, Libya, Gambia, Angola, Bhutan, China, Timor-Leste, Iraq and Mozambique.

China and the US , the two largest economies, still continue to be the bright spots and the main locomotives of the world economy, offering hope of global economic recovery.

Haq's Musings: India's GDP Shrank to $1.84 Trillion in 2012-13 in US Dollar Terms

Reactions: Like Like:
7


----------



## Hellraiser007

India's GDP is 2 Trillion and recent reports shows that Indian GDP in PPP terms is third in this world.

What ever hurdles we have will be overcome in the near future. We have lot of infra projects which is aimed at manufacturing. We are also improving our trade connectivity.

Nothing to worry. The growth forecast this year is close to 6.

Reactions: Like Like:
3


----------



## sree45

Good to see African nations developing. Who knows 22nd century might belong to them.


----------



## Bobby

Surprisingly Iran is 4th fastest shrinking economy...


----------



## Gandhi G in da house

@RiazHaq ,

Can you post the actual source of this information ?

Reactions: Like Like:
2


----------



## Parul

nick_indian said:


> @RiazHaq ,
> 
> Can you post the actual source of this information ?



I may be wrong but I think Mr. @RiazHaq is the actual source of this information.

Reactions: Like Like:
5


----------



## farhan_9909

I was reading on wiki the past and future GDP's of countries

I was surprised when i saw that in 2004 if i am not wrong despite a growth rate of 6.9-7.2% India GDP increased from 501billions dollars to 605billions dollars..i just dont know how this happened.

Now here come a surprise from Pakistan side as well

Pakistan GDP in 2011 was 210-12billions dollars

Than in 2012 to 228-230billions dollars and 

now in 2013 252billions dollars

in both the economies the increase is more than 8% while the growth rate of both the countries is below 5%

anyone good at economics please explain this


----------



## Jade

farhan_9909 said:


> I was reading on wiki the past and future GDP's of countries
> 
> I was surprised when i saw that in 2004 if i am not wrong despite a growth rate of 6.9-7.2% India GDP increased from 501billions dollars to 605billions dollars..i just dont know how this happened.
> 
> Now here come a surprise from Pakistan side as well
> 
> Pakistan GDP in 2011 was 210-12billions dollars
> 
> Than in 2012 to 228-230billions dollars and
> 
> now in 2013 252billions dollars
> 
> in both the economies the increase is more than 8% while the growth rate of both the countries is below 5%
> 
> anyone good at economics please explain this



This issue has been beaten to death on PDF. This the effect of inflation.


----------



## Gandhi G in da house

No proper source for this news except his blog. Futile discussion as long as he doesn't provide the real source.


----------



## Arya Desa

Jade said:


> This issue has been beaten to death on PDF. This the effect of inflation.



Isn't inflation good for an economy? Isn't it a multipier of the growth rate?


----------



## Jade

Arya Desa said:


> Isn't inflation good for an economy? Isn't it a multipier of the growth rate?



Neither too low nor too high inflation is good. A low inflation means prices are going up slowly, meaning economic growth is weak; a high inflation means prices are going up too fast meaning demand for the goods will be stymied, meaning negative effect on the growth. 

A healthy inflation is good, and healthy here will defer from country to country.

Reactions: Like Like:
1


----------



## My-Analogous

farhan_9909 said:


> I was reading on wiki the past and future GDP's of countries
> 
> I was surprised when i saw that in 2004 if i am not wrong despite a growth rate of 6.9-7.2% India GDP increased from 501billions dollars to 605billions dollars..i just dont know how this happened.
> 
> Now here come a surprise from Pakistan side as well
> 
> Pakistan GDP in 2011 was 210-12billions dollars
> 
> Than in 2012 to 228-230billions dollars and
> 
> now in 2013 252billions dollars
> 
> in both the economies the increase is more than 8% while the growth rate of both the countries is below 5%
> 
> anyone good at economics please explain this



Because there is no proper registration in India and specially in Pakistan case so it is very difficult to establish value and some people even stated that Pakistan current economy is more then 300 Billion US Dollar.


----------



## RiazHaq

Sharp fall in Indian currency against the US dollar and slower economic growth have caused India's GDP for Fiscal Year 2012-13 to shrink in US $ terms to $1.84 trillion from $1.87 trillion a year earlier. The Indian rupee has plummeted from 47.80 in 2012 to 54.30 to a US dollar in 2013, according to Business Standard. Since this report was published in Business Standard newspaper, Indian rupee has declined further against the US dollar to Rs. 59.52 today. At this exchange rate, *India's GDP is down to $1.68 trillion, about $200 billion less than it was in Fiscal 2011-12.*

http://www.pakalumni.com/profiles/b...k-in-usd-terms-in-2012-13-as-global-economy-s


----------



## djsjs

so nice for exporting.it makes me envy.exporters of India would benefit much, isn't it?


----------



## faithfulguy

djsjs said:


> so nice for exporting.it makes me envy.exporters of India would benefit much, isn't it?



But Indians in here don't care about that. They only care about it their GDP would go up in USD. Its a comparison game for them

Reactions: Like Like:
1


----------



## cirr

Hellraiser007 said:


> India's GDP is 2 Trillion and recent reports shows that Indian GDP in PPP terms is third in this world.
> 
> What ever hurdles we have will be overcome in the near future. We have lot of infra projects which is aimed at manufacturing. We are also improving our trade connectivity.
> 
> Nothing to worry. The growth forecast this year is close to 6.



This kind of attitude will ensure that India's growth rate will remain at least 30% below China&#8216;s for the next 10-20 years&#12290;

By dollars terms&#65292;the gap will be even wider&#12290;

The Indian economy is in a sh1t hole&#12290;India has exhausted all policy avenues for economic growth&#12290;

China's is a different story&#12290;It is in the midst of rebalancing and restructuring its investment-led growth with all the policy doors open&#65306;high bank reserve ratio&#65288;upwards of 20% compared with India's lowly 3-4%&#65289;&#12289;high interest rates comapred with CPI and PPI&#65288;5-6%&#12289;2%&#12289;-% respectively&#65289;&#12289;huge current account surplus&#65288;in hundreds of billions&#65289;&#12289;low fiscal deficit as a % of GDP&#12289;strict regulations limiting the purchase of properties&#12289;cars etc&#65292;and other brakes on the economy&#65292;all of which can be relaxed to drive economic growth if the government so desires&#12290;But 7.5% growth is enough considering the ongoing domestic rebalancing and shity external environment&#12290;China is in no hurry to play the role of global recovery engine&#12290;The best time to sort out your own problem is when the others are doing worse&#12290;

Reactions: Like Like:
6


----------



## AADHAAR

^^^ The problems India faces are like common cold, it just goes away with time.

On the other hand, PRC faces multi-organ failure. It has to worry, whether it will come out alive out of all this. If not, you have "commonwealth of chinese states" coming up.

And don't you preach about CRR to banking industry professionals... you don't know the facts. Do you even know what SLR is?

Reactions: Like Like:
4


----------



## HongWu

AADHAAR said:


> ^^^ The problems India faces are like common cold, it just goes away with time.
> 
> On the other hand, PRC faces multi-organ failure. It has to worry, whether it will come out alive out of all this. If not, you have "commonwealth of chinese states" coming up.
> 
> And don't you preach about CRR to banking industry professionals... you don't know the facts. Do you even know what SLR is?


The rupee has completely collapsed. India has been borrowing money to fund its spending and now it has no money to repay. Investors are fleeing the country. Unemployment is soaring. Looks like the Maoists are right: regime change is inevitable in India

Reactions: Like Like:
4


----------



## Parul

HongWu said:


> The rupee has completely collapsed. India has been borrowing money to fund its spending and now it has no money to repay. Investors are fleeing the country. Unemployment is soaring. Looks like the Maoists are right: regime change is inevitable in India



We have elections next year. Yes regime change is inevitable.


----------



## AADHAAR

HongWu said:


> The rupee has completely collapsed. India has been borrowing money to fund its spending and now it has no money to repay. Investors are fleeing the country. Unemployment is soaring. Looks like the Maoists are right: regime change is inevitable in India



Hi HongWu .... where is the "tent" ?


----------



## HongWu

AADHAAR said:


> Hi HongWu .... where is the "tent" ?


Keep deluding yourself...

Assertive China, Apologetic India | Business Line

June 5, 2013: During the past month, *China inflicted a national humiliation on India* by intruding 19 km across what has been the traditional border between Ladakh and Tibet since the 17th century. It not only forced India to pull back from its own territory in the Daulat Beg Oldi sector, but also to dismantle Defence structures in the Chumar sector.

Moreover, apart from violating all past agreements on the Ladakh-Tibet border, China&#8217;s territorial claims also violate the provisions of the Wen Jiabao-Manmohan Singh Agreement of 2005 Agreement on the Guiding Principles for a border settlement which state: &#8220;The (Sino-Indian) boundary should be along well defined and easily identifiable geographical features, to be mutually agreed upon&#8221;. India&#8217;s claims, based on historical data, also fulfil the provisions of the 2005 Agreement as they set the western borders up to the Indus River Watershed, with the Karakoram mountains forming the natural boundary. After being militarily humiliated, India chose to subject itself to diplomatic ridicule in the Joint Statement issued after the visit of the Chinese Premier Li Keqiang. While the Joint Statement paid lip service to the 2005 Guiding Principles, there was no mention of the need for defining the Line of Actual Control (LAC) in accordance with these guiding principles.

Unless we insist on China furnishing its version of LAC, the Chinese will continue to stall and obfuscate, while placing our forces in an untenable position along the borders, with India meekly agreeing to pull down any defences the Chinese demand. Worse still, India agreed to accept some ridiculous and one-sided provisions which are clearly detrimental to its national interests. The most astonishing provision of the Joint Statement was the sentence: &#8220;The two sides are committed to taking a positive view and support each other&#8217;s friendship with other countries&#8221;. This, in effect, was an endorsement of Chinese policies of &#8220;low cost containment&#8221; of India.

Reactions: Like Like:
3


----------



## faithfulguy

HongWu said:


> The rupee has completely collapsed. India has been borrowing money to fund its spending and now it has no money to repay. Investors are fleeing the country. Unemployment is soaring. Looks like the Maoists are right: regime change is inevitable in India



India do not need a regime change. Indian people should take the advise of Lee Kuan Yew and split up into political divisions before the British united them.

Reactions: Like Like:
2


----------



## HongWu

Indian economy going through a mild recession: Shankar Sharma - Economic Times

Reactions: Like Like:
3


----------



## Cyberian

India's Nominal GDP:
2011 = 1.838 trillion
2012 = 1.825 trillion

List of countries by past and future GDP (nominal)

According to IMF, India's GDP shrank by around $13 billion. How? What happened?

Were the growth figures adjusted for previous years from the last decade?

If the above figures by IMF are correct then it would mean India's Nominal GDP will need to grow by $175 billion in 2013 to reach the $2 trillion mark!


----------



## American spying

Indian economy is a debt fuelled bubble that has burst with the Rupee collapsing. India will average around 2-3% growth over the next decade until the Indian economy has deleveraged. India has no manufacturing industry to export to have trade surpluses. Their economy has been running on debt for the last decade or so since reform has slowed. It's clear until India becomes an export powerhouse with trade surpluses, India will continue to be a debtor country.

Indian economy is going to have it very tough a decade or so. Currency collapse is the worst thing a country can experience.

Reactions: Like Like:
2


----------



## Wright

India has a billion people and expected to overtake China in population. India just might be too big to fail.


----------



## RiazHaq

SUPARCO said:


> India's Nominal GDP:
> 2011 = 1.838 trillion
> 2012 = 1.825 trillion
> 
> List of countries by past and future GDP (nominal)
> 
> According to IMF, India's GDP shrank by around $13 billion. How? What happened?
> 
> Were the growth figures adjusted for previous years from the last decade?
> 
> If the above figures by IMF are correct then it would mean India's Nominal GDP will need to grow by $175 billion in 2013 to reach the $2 trillion mark!



Indian rupee is continuing to decline against the US dollar to Rs. 59.52 today. At this exchange rate, India's GDP is down to $1.68 trillion, about $200 billion less than it was in Fiscal 2011-12. 

Meanwhile, Pakistan's economy continues to struggle with its annual GDP rising just 3.6% to $252 billion ($242 billion at Rs. 100 to a USD exchange rate) in fiscal 2012-13, according to Economic Survey of Pakistan 2012-13 estimates based on 9 months data. The country is facing militancy and energy shortages impacting its economy.

Haq's Musings: India's GDP Shrank to $1.84 Trillion in 2012-13 in US Dollar Terms


----------



## RiazHaq

Here's a Reuters' report on GS analyst calling investments in emerging markets a "costly mistake":

LONDON, July 4 (Reuters) - Investors who wrongly called time on U.S. economic supremacy during the financial crisis are set to pay a hefty price for betting too much on the developing world, according to a top Goldman Sachs strategist.

The U.S. investment bank helped inspire a twenty-fold surge in financial investment in China, India, Russia and Brazil over the past decade, its chief economist popularising the term BRICs in a 2001 research paper.

Sharmin Mossavar-Rahmani, in charge of shaping the portfolios of the bank's rich private clients, has been arguing against that trend for four years, however, trying to persuade investors and colleagues they were safer sticking with the developed world.

The past six months has substantially vindicated that view. China's boom is finally wobbling under the weight of economic imbalances including an undervalued currency, and emerging stock markets are down 13 percent compared to an 11 percent rise in the U.S. S&P 500 index over the same period.

"Many investors and market commentators have been too euphoric about China over the last decade and this euphoria is finally abating. Many just followed the herd into emerging markets and over-allocated to many of the key countries," she says.

"It is easier to be part of the herd even if one is wrong, than stay apart from the herd and be right in the long run."

The net gains for U.S. stock markets may just be a taste of the reassertion of western dominance that may emerge in the next few years, Mossavar-Rahmani argues.

Structural advantages like abundant mineral wealth, positive demographics and, most importantly, inclusive, well-run political and economic institutions make the United States the best bet going forward, she says.

"(Emerging market) investors are taking on so many risks compared with the U.S. where the risk is largely cyclical rather than structural," she says.

Many of the cyclical issues affecting the U.S. such as high levels of debt, are also on their way to being resolved.

"One thing that normally puts investors off from increasing their U.S. holdings is the long term debt profile, but we think the magnitude of the work done to address this has been underappreciated by investors," she says.

WEST IS BEST

The idea that authoritarian countries are less effective than open economies like the U.S. at incentivising entrepreneurship and innovation is long accepted in academia.

Daron Acemoglu and James Robinson laid out the case for doubting the emerging power of China and others in a book 'Why Nations Fail' last year, arguing poor institutions that entrench inequality will hamper a country's path to prosperity.

But this view was largely put aside by professional investors who allowed themselves to be swept up in a "mania" about the rewards up for grabs in emerging markets, especially China....

INTERVIEW-Emerging markets mania was a costly mistake -Goldman exec


----------



## RiazHaq

Here's Reuters on how India is dealing with record slide of Indian Rupee against US dollar:

India is considering calling on its millions of non-resident citizens to help reverse a record slide in the rupee and does not favour the idea of a global sovereign bond at this time, senior government officials told Reuters on Monday.

However, the government strongly denied having ruled out a sovereign bond issue and said in a statement that "all options are on the table".

The officials, who spoke earlier on condition of anonymity, said India was running out of options and time to revive the currency and fund a record current account deficit but equally policymakers were wary of sending any distress signals to international markets.

Issuing a global bond might send such a signal, so instead policymakers will focus on attracting funds from Indians living abroad, such as by raising deposit rates in India or issuing bonds specifically designed for them - repeating measures carried out in 1998 and 2000 to steady a weak rupee.

The officials declined to be identified because of the sensitivity of discussing government deliberations. They were not immediately reachable for further comment.

The officials said other options included an increase in RBI policy rates and allowing select firms to raise capital overseas.

"All have agreed that it is not a time for India to issue sovereign bonds at this stage," one official said, adding that the central bank agreed with that position too.

"We do not have much options. Whatever has to be done, will be done in the next few weeks," the official said. "We have a window of only few weeks," he said.

"The government could ask banks to raise interest rates to attract an additional $15-20 billion," he said.

The news prompted the 10-year benchmark 7.16 percent, 2023 bond yield to jump 8 basis points to 8.08 percent, while the rupee ticked lower on the news that a global bond was not being considered right now.
---
India has the second-largest diaspora in the world, with a community estimated at more than 25 million, the Ministry of Overseas Indian Affairs says.

Central bank figures show non-resident Indians (NRIs) held $58 billion in dollar deposits in India as of September 2012, plus local currency deposits worth 3 trillion rupees.

Since the rupee's rapid decline, inflows of money from NRIs have risen, the government official said. The currency traded at around 59.70 per dollar on Monday to be about a percent above its record low of 61.21 hit on July 8.
-----------

"The rating agencies are already watching us closely, we have to manage the situation in a subtle manner," he said.

The government's first line of defence therefore would be to woo non-resident Indians, sources said.

NRIs lapped up bonds and deposits issued by India in 1998 and 2000, helping bridge massive gaps in India's funding needs. Now, with a current account deficit at a record 4.8 percent of economic output, the country needs all the funding it can get.

The government sources said India could consider raising the repo rate, the central bank's main policy rate, if the rupee falls towards 61-62 to the dollar, citing recent meetings between the government and the RBI.

The government is also considering allowing select companies such as state-run India Infrastructure Finance Co Ltd or IDFC Ltd (IDFC.NS) to raise up to $4 billion in debt abroad, they said.

The first official said state-owned banks are likely to be asked to raise funds from overseas markets to meet their capital needs.

"Even if 5-7 banks raise $1 billion each, it will help us," he said. 

India to call on millions of non-residents to defend rupee - sources | Reuters


----------



## RiazHaq

Here's India Today on Goldman Sachs' downgrade of Indian economy:

US investment bank Goldman Sachs on Thursday downgraded its ratings on Indian stocks, calling them underweight as the rupee continued to tumbling against the dollar and economic growth remains sluggish.
The bank said the external funding environment has also become challenging causing the Reserve Bank of India (RBI) to tighten liquidity.
The bank also expected corporate earnings to grow at 5 per cent for the current fiscal year and 11 per cent for the next year, below consensus estimates.
"Recent activity data in the second quarter of 2013 has been sluggish with no signs of a pick-up in investment demand... Against a backdrop of lower growth, tighter liquidity and rising macro vulnerabilities, we downgrade India to underweight," the bank said.
"Our forecast for the dollar-rupee remains at 60 for the year but we expect continued weakness to 65 through 2016. The rupee remains inexpensive relative to our fair value estimate of dollar-rupee 65 which also suggests the currency can continue to weaken," it said.
"We even think that there is a greater probability of the RBI keeping liquidity tight even beyond 6 months, and hiking policy rates as well, rather than cutting them," it said.


Read more at: Goldman Sachs downgrades Indian economy, says stocks underweight : Market, News - India Today


----------



## RiazHaq

With Indian rupee's free fall to 61.10 to a US dollar, Indian GDP in USD terms is down to about $1.64 trillion based on Rs. 100.2 trillion divided by 61.10

Reactions: Like Like:
2


----------



## fast

RiazHaq said:


> With Indian rupee's free fall to 61.10 to a US dollar, Indian GDP in USD terms is down to about $1.64 trillion based on Rs. 100.2 trillion divided by 61.10



Ouch! That's quick to reach 61. It looks like a free fall. GOI still calls on foreign Indian nationals to send money back to shore up the Rupee. Don't they have no fear that international currency raiders like Soros could come in to pop their bubble?


----------



## HongWu

fast said:


> Ouch! That's quick to reach 61. It looks like a free fall. GOI still calls on foreign Indian nationals to send money back to shore up the Rupee. Don't they have no fear that international currency raiders like Soros could come in to pop their bubble?


Looks like Indian rupee will be 100 to 1 US dollar by the end of this year. India is quickly becoming poorer than when their begging for independence from UK finally succeeded.


----------



## Icewolf

All Indians should start buying gold, seriously... When Indian debt bubble collapses India will be in a bad state.. Im advising you to


----------



## my2cents

Icewolf said:


> All Indians should start buying gold, seriously... When Indian debt bubble collapses India will be in a bad state.. Im advising you to



Even gold doesn't look attractive and is loosing its shine. When the global economy is slow then it is a difficult proposition to shore up investors confidence. Time to loosen up protectionist policies and allow free flow of FDI. 

Fiscal discipline is in order until this tide of bad news is over.


----------



## IND151

Bobby said:


> Surprisingly Iran is 4th fastest shrinking economy...



not surprising

The US led policy which aims at forcing Customers of Iran to reduce the amount of oil to be imported from Iran and other sanctions are showing their effect, I Think


----------



## IND151

Arya Desa said:


> Isn't inflation good for an economy? Isn't it a multiplier of the growth rate?



Only creeping inflation is good for economy, not running and galloping

galloping inflation is what Germany experienced after 1918, when 1 Dollar=20,000 marks


----------



## RiazHaq

my2cents said:


> Even gold doesn't look attractive and is loosing its shine. When the global economy is slow then it is a difficult proposition to shore up investors confidence. Time to loosen up protectionist policies and allow free flow of FDI.
> 
> Fiscal discipline is in order until this tide of bad news is over.



Indians' love of gold is in large part responsible for worsening current account deficit and pressure on rupee. That's why Indian govt is rightly restricting gold imports.

Reactions: Like Like:
1


----------



## Pandora

Curry Pot is ready so now it is time to eat for indian politicians and rich Businessmen.


----------



## tranquilium

Bobby said:


> Surprisingly Iran is 4th fastest shrinking economy...



What's so surprising about that? It is one of the most heavily sanctioned nations on the planet and its neighbors are not exactly friendly with them as well. I think their situation can be alleviated somewhat if they can get a direct railway connection to China.


----------



## my2cents

RiazHaq said:


> Indians' love of gold is in large part responsible for worsening current account deficit and pressure on rupee. That's why Indian govt is rightly restricting gold imports.



Indians love for gold is not going to diminish by imposing duties or restrictive policies. Because of its universal appeal and acceptance we consider gold has safety net against economic collapse or runaway inflation. 

You will see a lot of gold coming from middle east via smuggling. It will be Indian govt. who will be at a loss. Loss of revenue and promoting smuggling.

One way to curb the gold imports is to encourage gold EFT's. In Indian context EFT's haven't gotten same response as holding physical gold. Most of the gold we import is used for making jewelry and very little about 25 % is for investment. Hence the luke warm response to gold EFT's. 

Weak rupee and high gold imports is responsible for the mess we are in. If we work on these two then we have a chance to narrow our current account deficit.


----------



## RiazHaq

my2cents said:


> Indians love for gold is not going to diminish by imposing duties or restrictive policies. Because of its universal appeal and acceptance we consider gold has safety net against economic collapse or runaway inflation.
> 
> You will see a lot of gold coming from middle east via smuggling. It will be Indian govt. who will be at a loss. Loss of revenue and promoting smuggling.
> 
> One way to curb the gold imports is to encourage gold EFT's. In Indian context EFT's haven't gotten same response as holding physical gold. Most of the gold we import is used for making jewelry and very little about 25 % is for investment. Hence the luke warm response to gold EFT's.
> 
> Weak rupee and high gold imports is responsible for the mess we are in. If we work on these two then we have a chance to narrow our current account deficit.



I think Indians' love of gold is more emotional than rational. Most Indians who buy gold do it for women's jewelry which signifies family's conspicuous wealth. It's ostentatious--not for investment purpose or hedging against inflation.

Reactions: Like Like:
1


----------



## UnChosen

Now the corrupted rich Indian politicians and businessmen can now bring back their ill-gotten wealth at bargain exchange rates and buy up (more) Indian assets. Of course they'll now wait for the next good opportunity to get more stolen wealth out of the country rather than invest in their own country...so the collapsing rupee ends up not giving the country extra export at all.

This is the reason why China has capital control and a pegged currency....can't leave these things to the free market when there are corrupted thieves running around.

Reactions: Like Like:
2


----------



## Okemos

Time to import oil from Iran and minerals from India while prices are low!


----------



## livingdead

@RiazHaq how much did pakistani economy grow/shrink in dollar term... during same period..


----------



## Chinese-Dragon

hinduguy said:


> @RiazHaq how much did pakistani economy grow/shrink in dollar term... during same period..



First column is 2011 data, second column is 2012 data.

List of countries by GDP (nominal) - Wikipedia, the free encyclopedia

Sourced from World Bank, IMF, etc.

The Indian economy shrunk a bit in this period, while the Pakistani economy expanded slightly.

China's economy went up by about 1 trillion in the same period, which was the largest increase of any country by a big margin.

USA comes second, they added about half a trillion to their GDP in the same period. 

The USA and China have the biggest base economies, so even a small "percentage" growth rate can mean a huge addition to GDP per year.

Reactions: Like Like:
1


----------



## farhan_9909

Chinese-Dragon said:


> First column is 2011 data, second column is 2012 data.
> 
> List of countries by GDP (nominal) - Wikipedia, the free encyclopedia
> 
> Sourced from World Bank, IMF, etc.
> 
> The Indian economy shrunk a bit in this period, while the Pakistani economy expanded slightly.
> 
> China's economy went up by about 1 trillion in the same period, which was the largest increase of any country by a big margin.
> 
> USA comes second, they added about half a trillion to their GDP in the same period.
> 
> The USA and China have the biggest base economies, so even a small "percentage" growth rate can mean a huge addition to GDP per year.



PAK GDP expanded with almost 20billion dollars addition for the last 2 year despite the growth rate of 3.7%..how is this possible?

210billion dollars in 2011
233billion dollars in 2012
252.6billion dollars in 2013

can you explain me this how?despite the slow growth

also if you check in the above list

INDIAN GDP between 2004-07 expanded by almost 80-100billion dollars each year despite the growth rate of only 7-8% which means a increase about 40-45billon dollars only?than why such an huge increases.?


----------



## Chinese-Dragon

farhan_9909 said:


> PAK GDP expanded with almost 20billion dollars addition for the last 2 year despite the growth rate of 3.7%..how is this possible?
> 
> 210billion dollars in 2011
> 233billion dollars in 2012
> 252.6billion dollars in 2013
> 
> can you explain me this how?despite the slow growth



Increase in GDP is not just the Real growth rate (the Real growth rate is the most commonly quoted number). It is the Nominal growth rate.

Nominal growth rate = Real growth rate + Inflation.

And you also have to take currency movement into account.

It is a combination of all factors. If you have a lot of inflation, your nominal GDP can rise fast. 

Whereas India's economy shrunk in dollar GDP terms because of the fall of the Rupee.

Reactions: Like Like:
2


----------



## 474474

Chinese-Dragon said:


> Increase in GDP is not just the Real growth rate (the Real growth rate is the most commonly quoted number). It is the Nominal growth rate.
> 
> Nominal growth rate = Real growth rate + Inflation.
> 
> And you also have to take currency movement into account.
> 
> It is a combination of all factors. If you have a lot of inflation, your nominal GDP can rise fast.
> 
> Whereas India's economy shrunk in dollar GDP terms because of the fall of the Rupee.



I've noticed from experience life is cheaper in Pakistan despite high inflation compared to low inflation western countries, why is that?


----------



## Chinese-Dragon

474474 said:


> I've noticed from experience life is cheaper in Pakistan despite high inflation compared to low inflation western countries, why is that?



The Inflation rate, is the percentage *rate of change* in prices.

But because developing countries (like China/Pakistan/India) have low base prices, even a high percentage rate of inflation won't raise it too much, because the base prices are low to begin with.

Still it is not good to have a high inflation rate, since percentages can build up over time.

Reactions: Like Like:
1


----------



## Chinese-Dragon

India's GDP already fell from 2011 to 2012, now with the Rupee collapsing further let's see how far down the list India sinks this time.


----------



## Khalsa97

cirr said:


> This kind of attitude will ensure that India's growth rate will remain at least 30% below Chinas for the next 10-20 years&#12290;
> 
> By dollars terms&#65292;the gap will be even wider&#12290;
> 
> The Indian economy is in a sh1t hole&#12290;India has exhausted all policy avenues for economic growth&#12290;
> 
> China's is a different story&#12290;It is in the midst of rebalancing and restructuring its investment-led growth with all the policy doors open&#65306;high bank reserve ratio&#65288;upwards of 20% compared with India's lowly 3-4%&#65289;&#12289;high interest rates comapred with CPI and PPI&#65288;5-6%&#12289;2%&#12289;-% respectively&#65289;&#12289;huge current account surplus&#65288;in hundreds of billions&#65289;&#12289;low fiscal deficit as a % of GDP&#12289;strict regulations limiting the purchase of properties&#12289;cars etc&#65292;and other brakes on the economy&#65292;all of which can be relaxed to drive economic growth if the government so desires&#12290;But 7.5% growth is enough considering the ongoing domestic rebalancing and shity external environment&#12290;China is in no hurry to play the role of global recovery engine&#12290;The best time to sort out your own problem is when the others are doing worse&#12290;


Seriously lmao, who brought china into this?


----------



## Chinese-Dragon

Khalsa97 said:


> Seriously lmao, who brought china into this?



The Indians who post China economy bashing threads. 

In return for that bashing, we offer insightful analysis into India's own economy. What a great deal for you guys.


----------



## Khalsa97

Chinese-Dragon said:


> The Indians who post China economy bashing threads.
> 
> In return for that bashing, we offer insightful analysis into India's own economy. What a great deal for you guys.


I haven't seen one of those. Care to show me some recent examples? And if your that desperate for "payback" start another thread, don't start making comparisons on a thread that has nothing to do with China because honestly you look incredibly desperate lmao. And also have you got any credentials to back up your "insightful analysis" such as a degree?


----------



## Chinese-Dragon

Khalsa97 said:


> I haven't seen one of those. Care to show me some recent examples? And if your that desperate for "payback" start another thread, don't start making comparisons on a thread that has nothing to do with China because honestly you look incredibly desperate lmao. And also have you got any credentials to back up your "insightful analysis" such as a degree?



I can comment on any thread, and if you don't like it, I couldn't care less. 

According to IMF numbers, India's economy shrunk from 2011 to 2012.

And with the Rupee collapsing, India's GDP is set to shrink further. That's what the thread is about, did you read the thread title?


----------



## RiazHaq

Here's Wall Street Fool on coming "collapse" of Indian economy:

I hate being a narcissist and an ego-maniac, but the truth is: I TOLD YOU SO.

If you haven&#8217;t already, I highly recommend READING THIS ARTICLE, that I had written last month (April 2013), and THIS ARTICLE (May 2013), outlining the exact process/method/path to India&#8217;s Inevitable Economic Collapse. Needless to say, India&#8217;s GDP just took a dump + The Reserve Bank of India (RBI) insisting that it wont cut rates as there is a significant UPSIDE RISK TO INFLATION, spooking investors and resulting in a highly coordinated (Panic) sell-off.

Here&#8217;s the piece from Times of India:

Pulled down by poor performance of farm, manufacturing and mining sectors, economic growth slowed to 4.8% in the January-March quarter and fell to a decade&#8217;s low of 5% for the entire 2012-13 fiscal.

Belying hopes of further rate cuts, the Reserve Bank governor D Subbarao&#8217;s comments that there are still upsides risks to inflation spooked stock markets. Additionally, RBI&#8217;s concern about widening country&#8217;s current account deficit amid rupee falling to over 10-month lows, also put pressure.

In this realm of reality, that we all inhabit, you simply cannot have both, Economic Growth and Low Inflation at the same time. Something has to give.

So here&#8217;s what I think is gonna happen:

The market players (American Hedge Funds) are going to rob the RBI at gun-point, just like Greece, and no-one will be able to stop them. The RBI will cave, and go BOJ on everyone&#8217;s ***.

India's Inevitable Economic Collapse | Wall Street Fool


----------



## Azazel

Chinese-Dragon said:


> First column is 2011 data, second column is 2012 data.
> 
> List of countries by GDP (nominal) - Wikipedia, the free encyclopedia
> 
> Sourced from World Bank, IMF, etc.
> 
> The Indian economy shrunk a bit in this period, while the Pakistani economy expanded slightly.
> 
> China's economy went up by about 1 trillion in the same period, which was the largest increase of any country by a big margin.
> 
> USA comes second, they added about half a trillion to their GDP in the same period.
> 
> The USA and China have the biggest base economies, so even a small "percentage" growth rate can mean a huge addition to GDP per year.



Indian economy never shrunk in any period.Its the nominal GDP figure that did.Both are not the same thing.Get your facts straight.


----------



## Chinese-Dragon

Azazel said:


> Indian economy never shrunk in any period.Its the nominal GDP figure that did.Both are not the same thing.Get your facts straight.



OK you're right, my mistake. 

I'll rephrase: 

India's GDP shrunk from 2011 to 2012. And considering the fall of the Rupee, India's GDP is likely to shrink further into 2013.

Reactions: Like Like:
1


----------



## Azazel

Chinese-Dragon said:


> OK you're right, my mistake.
> 
> I'll rephrase:
> 
> India's GDP shrunk from 2011 to 2012. And considering the fall of the Rupee, India's GDP is likely to shrink further into 2013.



No you are wrong again.You see the problem is you don't have a clue what you are talking about.Its the nominal GDP or current dollar GDP..GDP and nominal GDP are two entirely different things.


----------



## RiazHaq

Here's Hindustan Times on Indian stocks collapse:


Stung by the rupee hitting historic low, stock markets on Tuesday collapsed on all-round selling with the S&P BSE Sensex nosediving by 449.22 points to end below the 19,000-mark, edging India out of the trillion dollar club.


Sentiment was extremely poor on Dalal Street as the rupee plunged to record low of 61.80 against the US dollar, stoking fears of a higher current account gap as import costs surge.

The Bombay Stock Exchange 30-share barometer resumed weak and continued its downslide to end at 18,733.04, a steep fall of 449.22 points or 2.34 %. In the last ten trading sessions, Sensex has fallen in nine days while yesterday has managed to settle in positive terrain.

After today's plunge and the rupee's decline, India's market capitalisation stood at Rs. 60.18 lakh crore, which translates to $989 billion at exchange rate of 60.8 versus the dollar. The rupee retreated from record lows to trade at 60.8 levels at 1710 hours.

Dipen Shah, Head of PCG Research, Kotak Securities said: "Markets ended sharply lower on the back of continuing concerns about the rupee and some disappointing results. The rupee traded at a new low and that caused concerns in market." ...

Stocks plunge on weak rupee, India out of trillion dollar club - Hindustan Times


----------



## Chinese-Dragon

Azazel said:


> No you are wrong again.You see the problem is you don't have a clue what you are talking about.Its the nominal GDP or current dollar GDP..GDP and nominal GDP are two entirely different things.



It's you who has no idea what you are talking about. 

I said GDP, and I linked to a site with nominal GDP numbers. So I obviously meant nominal GDP, for anyone who has an IQ above 82.

These semantic arguments are pathetic, though not unexpected.

And it won't save your shrinking GDP. Oh sorry, I specifically meant nominal GDP, for those who don't have enough brain cells to figure out which kind I meant after multiple links to nominal GDP charts.

Reactions: Like Like:
1


----------



## chhota bheem

Chinese-Dragon said:


> It's you who has no idea what you are talking about.
> 
> I said GDP, and I linked to a site with nominal GDP numbers. So I obviously meant nominal GDP, for anyone who has an IQ above 82.
> 
> These semantic arguments are pathetic, though not unexpected.



Sorry @Chinese dragon for the reply in the other thread, i was not in a good mood then.


----------



## Chinese-Dragon

chhota bheem said:


> Sorry @Chinese dragon for the reply in the other thread, i was not in a good mood then.



Neither am I, after all these Indians posting China bashing threads.

So we are even.


----------



## RiazHaq

Here's an Economist piece on India losing business and industry to overseas hubs:

Some service industries do seem to be shifting from India. India&#8217;s balance of trade in business and financial services has slipped into modest deficit from a surplus five years ago. The number of big India-related corporate legal cases at Singapore&#8217;s arbitration centre has doubled since 2009, to 49 last year. It is setting up a Mumbai office to win more business. Trading of equity-index derivatives has shifted&#8212;a fifth of open positions are now in Singapore and DGCX, a Dubai exchange, is launching two rival products this year. A recent deal by Etihad, the airline of Abu Dhabi, to buy a stake in Jet, an Indian carrier, should see more long-haul traffic shift to the Gulf. (Jet&#8217;s boss, Naresh Goyal, lives in London.) More rupee trading seems to be taking place offshore.

The biggest worry is that heavy industry is getting itchy feet. Coal India, a state-owned mining monopoly sitting on some of the world&#8217;s biggest reserves, plans to spend billions of dollars buying mines abroad&#8212;red tape and political squabbles mean it is too difficult to expand production at home.

Some fear manufacturing is drifting offshore. In the five years to March 2012, for every dollar of direct foreign investment in Indian manufacturing, Indian firms invested 65 cents in manufacturing abroad. Some big firms such as Reliance Industries plan to invest heavily in India, but others such as Aditya Birla are wary. Its boss, Kumar Mangalam Birla, has said that he prefers to invest outside India&#8212;an echo of his father, who expanded in South-East Asia during India&#8217;s bleak years in the 1970s.

The Gulf has seen tentative signs of Indian manufacturers shifting base. Rohit Walia, of Alpen Capital, an investment bank, says that in the past year he has helped finance an $800m fertiliser plant and a $250m sugar plant. Both will be built in the United Arab Emirates, by Indian firms that will then re-export much of the output back home. The Gulf&#8217;s cheap power and easy planning regime make this more feasible than setting up a plant in India. &#8220;It&#8217;s a new trend,&#8221; says Mr Walia.

The temptation for India is to invent new rules to keep economic activity from moving abroad. In 2012 the government tried to override its treaty with Mauritius, only to scare investors so much that it had to back down. To try to plug its balance of payments, India is tightening rules on buying gold. The country&#8217;s ministry of finance is said to be examining the shift of currency-trading offshore. The government has intervened to insist that shareholder disputes arising from the Etihad-Jet deal be settled under Indian law&#8212;not English as originally proposed.

Yet in the long run, coercing Indians and foreigners to do their business in India would be self-defeating. Some may simply go on strike and it is far better that activity takes place abroad than not at all. Any rise in the share of offshore activity is best viewed as a warning system about what is most in need of reform at home.

The biggest warning sign would be if Indians themselves started to leave. Despite some mutterings among the professional classes, that does not seem to be happening. Still, if India does not kick-start its economy and reform, more than derivative trading and Bollywood singalongs will shift abroad.

The Indosphere: Made outside India | The Economist


----------



## Chinese-Dragon

And now we have data showing that Chinese exports and imports are both growing strongly:



> *China&#8217;s exports and imports grew strongly in July, boosting confidence that the economy may be stabilising after a shaky first half of the year.*



China trade shows signs of recovery - Financial Times

Too bad for all those Indians.


----------



## Khalsa97

Chinese-Dragon said:


> I can comment on any thread, and if you don't like it, I couldn't care less.
> 
> According to IMF numbers, India's economy shrunk from 2011 to 2012.
> 
> And with the Rupee collapsing, India's GDP is set to shrink further. That's what the thread is about, did you read the thread title?



So you are desperate  Lmao you think you are the only educated person on this forum? We obviously know that we don't need some insecure Chinese person who has never had a girlfriend to tell us that I mean honestly, your giving it away by doing three large posts in a row


----------



## Chinese-Dragon

Khalsa97 said:


> So you are desperate  Lmao you think you are the only educated person on this forum? We obviously know that we don't need some insecure Chinese person who has never had a girlfriend to tell us that I mean honestly, your giving it away by doing three large posts in a row



Oh you are upset, that was easy.  And here I thought counter flaming would take some effort.

But it won't solve India's shrinking GDP, or collapsing Rupee. 

India was already poorer than Africa to begin with, now they are growing more slowly than Africa too, at only 4.5%. I guess Indians never really cared about their growth story, they let it die without a whimper.

Reactions: Like Like:
1


----------



## Khalsa97

Chinese-Dragon said:


> Oh you are upset, that was easy.  And here I thought counter flaming would take some effort.
> 
> But it won't solve India's shrinking GDP, or collapsing Rupee.
> 
> India was already poorer than Africa to begin with, now they are growing more slowly than Africa too, at only 4.5%. I guess Indians never really cared about their growth story, they let it die without a whimper.



Upset? Keep telling yourself that  but hey atleast you admit your desperate. You do know Africa isn't just one big country? Africa on a whole has around 1 billion people same as India. Yet India has a trillion dollar economy, can't say the same about Africa. Ha listen bro, if you want to troll articles 24/7 good for you but don't act like some expert economist haha.


----------



## Chinese-Dragon

Khalsa97 said:


> Upset? Keep telling yourself that  but hey atleast you admit your desperate. You do know Africa isn't just one big country? Africa on a whole has around 1 billion people same as India. Yet India has a trillion dollar economy, can't say the same about Africa. Ha listen bro, if you want to troll articles 24/7 good for you but don't act like some expert economist haha.



Africa as a whole has less people than India, but a bigger GDP, and less poverty too.

BBC quoted numbers from the UN Human development report to show that India has more poverty than the continent of Africa.

Go and check it to see for yourself.


----------



## MACKLEMORE

India GDP per capital by PPP is $3,829 in 2012, even Vietnam with $3,545 could reach its level this year.


----------



## RiazHaq

Jim Rogers: Why I&#8217;m shorting India

Hedge fund manager Jim Rogers, who moved to Singapore in 2007 because he thought the centre of the world is shifting to Asia, says India is set to miss out on the Asian century. The chairman of Rogers Holdings says that if there is one country an individual must visit, it has to be India for its &#8220;spectacular sensory feast, beautiful, food, colour and religions&#8221;, but it is also the worst country to do business in. Rogers also slammed the Indian government&#8217;s recent curbs on gold imports, saying Indian citizens had no choice but to buy the metal because they had very little faith in investing in other sectors of its economy. In an interview, Rogers spoke about the financial crisis and his bets for the future and defended his decision to be extremely negative about India in his just-released book Street Smarts: Adventures on the Road and in the Markets.

Jim Rogers: Why I&rsquo;m shorting India - Livemint


----------



## RiazHaq

Here's an excerpt of a Reuters' story on India rupee hitting a new record low:

The central bank's capital outflow restrictions came a day before the dollar spiked after U.S. jobless claims data on Thursday suggested an early end to the Fed's asset purchases.

That prospect looms over India at a time when it is suffering from a current account deficit that hit a record high of 4.8 percent of gross domestic product and an economy growing at a decade low of 5 percent.

Foreign investors have already sold a net $11.6 billion of Indian debt and equities since late May, sparking fears of continued weakness.

India's main NSE index .NSEI fell 4 percent at one point on Friday, while benchmark 10-year bond yields surged to their highest since May 2012 as prices headed for their worst week in four-and-a-half years.

UBS strategist Manik Narain said that as emerging central banks tightened policy to defend their currencies, stocks would be affected, something that is already happening in India.

"India is losing control over the currency and you are starting to see the weakness transmitting to stock markets. There could be a self-perpetuating cycle where currency weakness flushes out equity investors and that takes the rupee weaker still."

CAPITAL CONTROLS?

The RBI's new measures also included further capping the amount that companies can invest abroad.

But overseas investments from India had already been on the wane, averaging a monthly $400 million in the first half of the year from $710 million in 2012, according to DBS data.

The biggest fear is that the RBI's action could be the start of a far stronger move to restrain capital.

"The steps taken so far only target residents, but if this raises expectations that they could potentially resort to capital controls targeted at non-residents, that could have adverse near-term implications for capital flows," HSBC's Chief economist for India and ASEAN Leif Eskesen said.

"It will, therefore, be critical to tread very carefully when it comes to capital controls, to anchor expectations, and also not use it as a substitute for more appropriate and effective measures," Eskesen said in a note to clients.

RUPEE FALLS

As policy makers struggling to find a solution for the rupee's falls, investors expect more weakness ahead. Overseas investors betting via one-month offshore non-deliverable forwards quoted the rupee trading at 62.46, while onshore bets see the rupee at 62.35 within the month.

Meanwhile, a Reuters poll on Thursday showed short positions in the Indian rupee have hit the highest in two months.

At heart of India's failed defense of the rupee so far is that none of the measures unveiled so far have given markets assurance that the country can attract foreign flows in an increasingly difficult global environment.

India last month unveiled plans to further ease restrictions on foreign direct investment (FDI) but previous measures have had mixed results. FDI fell to $36.9 billion in the fiscal year ending in March from $46.6 billion the previous year.

This week it announced measures to attract near-term capital inflows, including by spurring state-run companies to sell debt abroad and raising funds from Indians abroad.

As Indian rupee hits record low, foreign investors baulk | Reuters


----------



## RiazHaq

Here's NY Times on India's growing troubles:

...a summer of difficulties has dented Indias confidence, and a growing chorus of critics is starting to ask whether Indias rise may take years, and perhaps decades, longer than many had hoped.

There is a growing sense of desperation out there, particularly among the young, said Ramachandra Guha, one of Indias leading historians.

Three events last week crystallized those new worries. On Wednesday, one of Indias most advanced submarines, the Sindhurakshak, exploded and sank at its berth in Mumbai, almost certainly killing 18 of the 21 sailors on its night watch.

On Friday, a top Indian general announced that India had killed 28 people in recent weeks in and around the Line of Control in Kashmir as part of the worst fighting between India and Pakistan since a 2003 cease-fire.

Also Friday, the Sensex, the Indian stock index, plunged nearly 4 percent, while the value of the rupee continued to fall, reaching just under 62 rupees per dollar, a record low.

Each event was unrelated to the others, but together they paint a picture of a country that is rapidly losing its swagger. Indias growing economic worries are perhaps its most challenging.

India is now the sick man of Asia, said Rajiv Biswas, Asia-Pacific chief economist at the financial information provider IHS Global Insight. They are in a crisis.

---.

The Indian government recently loosened restrictions on direct foreign investment, expecting a number of major retailers like Walmart and other companies to come rushing in. The companies have instead stayed away, worried not only by the governments constant policy changes but also by the widespread and endemic corruption in Indian society.

The government has followed with a series of increasingly desperate policy announcements in recent weeks in hopes of turning things around, including an increase in import duties on gold and silver and attempts to defend the currency without raising interest rates too high.

Then Wednesday night, the government announced measures to restrict the amounts that individuals and local companies could invest overseas without seeking approval. It was an astonishing move in a country where a growing number of companies have global operations and ambitions.
---------
The submarine explosion revealed once again the vast strategic challenges that the Indian military faces and how far behind China it has fallen. India still relies on Russia for more than 60 percent of its defense equipment needs, and its army, air force and navy have vital Russian equipment that is often decades old and of increasingly poor quality.

The Sindhurakshak is one of 10 Russian-made Kilo-class submarines that India has as part of its front-line maritime defenses, but only six of Indias submarines are operational at any given time  far fewer than are needed to protect the nations vast coastline.

Indeed, India has fewer than 100 ships, compared with Chinas 260. India is the worlds largest weapons importer, but with its economy under stress and foreign currency reserves increasingly precious, that level of purchases will be increasingly hard to sustain.

The countrys efforts to build its own weapons have largely been disastrous, and a growing number of corruption scandals have tainted its foreign purchases, including a recent deal to buy helicopters from Italy.

Unable to build or buy, India is becoming dangerously short of vital defense equipment, analysts say.

Meanwhile, the countrys bitter rivalry with Pakistan continues. Many analysts say that India is unlikely to achieve prominence on the world stage until it reaches some sort of resolution with Pakistan of disputes that have lasted for decades over Kashmir and other issues.

http://www.nytimes.com/2013/08/19/business/global/a-summer-of-troubles-saps-indias-confidence.html


----------



## JayAtl

Oh gawd , Haq the huckster and fraudster is back spamming the same article in multiple threads.


----------



## RiazHaq

India on verge of financial crisis, says The Guardian:

The Reserve Bank of India (RBI) in Mumbai. The country is facing its own financial crisis. Photograph: Vivek Prakash/REUTERS
India's financial woes are rapidly approaching the critical stage. The rupee has depreciated by 44% in the past two years and hit a record low against the US dollar on Monday. The stock market is plunging, bond yields are nudging 10% and capital is flooding out of the country.

In a sense, this is a classic case of deja vu, a revisiting of the Asian crisis of 1997-98 that acted as an unheeded warning sign of what was in store for the global economy a decade later. An emerging economy exhibiting strong growth attracts the attention of foreign investors. Inward investment comes in together with hot money flows that circumvent capital controls. Capital inflows push up the exchange rate, making imports cheaper and exports dearer. The trade deficit balloons, growth slows, deep-seated structural flaws become more prominent and the hot money leaves.

The trigger for the run on the rupee has been the news from Washington that the Federal Reserve is considering scaling back - "tapering" - its bond-buying stimulus programme from next month. This has consequences for all emerging market economies: firstly, there is the fear that a reduced stimulus will mean weaker growth in the US, with a knock-on impact on exports from the developing world. Secondly, high-yielding currencies such as the rupee have benefited from a search for yield on the part of global investors. If policy is going to be tightened in the US, then the dollar becomes more attractive and the rupee less so.

But while the Indonesian rupee and the South African rand are also feeling the heat, it is India &#8211; with its large trade and budget deficits &#8211; that looks like the accident most likely to happen. On past form, emerging market crises go through three stages: in stage one, policymakers do nothing in the hope that the problem goes away. In stage two, they cobble together some panic measures, normally involving half-baked capital controls and selling of dollars in an attempt to underpin their currencies. In stage three, they either come up with a workable plan themselves or call in the IMF. India is on the cusp of stage three.

India on the brink of its own financial crisis | Business | The Guardian


----------



## RiazHaq

Indian rupee continued its downward spiral...down 4.4 percent to a record this week in its worst performance since 1993 on signs the U.S. is getting closer to reducing stimulus that fueled demand for emerging-market assets.

At INR 65 to a US $, India's 2012-13 GDP is down to $1.54 trillion....Rs. 100.2 trillion/65.

#RBI actions too little too late as #India 's #financialcrisis intensifies. 1990s Asia currency crisis being repeated?

Haq's Musings: India's GDP Shrank to $1.84 Trillion in 2012-13 in US Dollar Terms


----------



## Lightningbolt

India is economically and financially finished!

Reactions: Like Like:
2


----------



## RiazHaq

Here's Wall Street Journal quoting BRIC coiner Jim O'Neill as saying &#8220;If I were to change it, I would just leave the &#8216;C&#8217;:


SAO PAULO&#8211;Former Goldman Sachs Asset Management Chairman Jim O&#8217;Neill, who coined the BRIC acronym describing four burgeoning emerging market countries, stands by the term he invented more than a decade ago, but admits that three of the countries have disappointed him in recent years.

The acronym created in 2001 groups Brazil, Russia, India and China, and has become a reference for a perceived shift in economic power toward developing economies.

&#8220;If I were to change it, I would just leave the &#8216;C,&#8217;&#8221; Mr. O&#8217;Neill said in an interview. &#8220;But then, I don&#8217;t think it would be much of an acronym.&#8221;

Economic growth in other BRIC countries has been disappointing, and the economic outlook for developing economies in general has changed in the last few years amid the end of a commodities boom and a slowdown in Chinese growth&#8211;which nevertheless remains high compared with that of its counterparts.

Meanwhile, signs of a recovery in the U.S and expectations the Federal Reserve will soon reduce its bond-buying program have helped strengthen the U.S. dollar, sucking money out of emerging markets and putting even more pressure on their less developed economies.

It has become &#8220;fashionable&#8221; to say the developed world is recovering while emerging markets are all slowing down, Mr. O&#8217;Neill said. &#8220;But what people don&#8217;t understand is the size of China,&#8221; he added.

The economist said that if China&#8217;s economy grows 7.5% this year, as he expects, that would create an additional $1 trillion in wealth, in U.S. dollar terms. &#8220;For the U.S. to contribute at the same level, it would have to grow around 3.75%,&#8221; Mr. O&#8217;Neill said.

Economists currently expect the U.S. economy to expand 1.5% in 2013, down from 2% projected in May, according to a recent survey by the Federal Reserve Bank of Philadelphia.

From 2011 to 2020, Mr. O&#8217;Neill said he has assumed average growth for the BRIC countries of 6.6% a year, less than the 8.5% average in the previous decade. Most of it up to now has come from China.

India has been the biggest disappointment among the BRIC countries, while Brazil has been the most volatile in terms of investor perceptions, the economist said.

&#8220;Between 2001 and 2004, many people told me I should never have included Brazil. Then, from 2008 to 2010, people told me I was a genius for including Brazil and now, again, people say Brazil doesn&#8217;t deserve to be there,&#8221; he said.

Brazil&#8217;s economic growth, which reached 7.5% in 2010, has been weak since then in spite of multiple government stimulus measures. The country seems doomed to growth of 2% or so in both 2013 and 2014, according to economists&#8217; forecasts.

Brazil&#8217;s rapid growth in 2010 raised expectations, but many people forgot that the country is vulnerable to big moves in commodities prices, Mr. O&#8217;Neill said.

Another problem, he said, is that private investment remains a small share of the country&#8217;s gross domestic product. Brazil&#8217;s investment rate has been stuck at around 18% of GDP, the lowest level of any BRIC country, for a decade.

---

&#8220;They should only worry if there&#8217;s a pickup in inflation expectations; otherwise, they should relax,&#8221; he said, before the central bank late Thursday unveiled a massive intervention program to provide relief for the currency.

Brazilian inflation is currently 6.15%, close to the 6.5% ceiling of the central bank&#8217;s target range for 2013.

Even in the face of weak growth, Mr. O&#8217;Neill says he doesn&#8217;t plan to add or subtract letters from his famous acronym.

&#8220;If, by the end of 2015, there is persistent weak growth in Brazil, India or Russia, then I might,&#8221; he said, noting, however, that he expects Brazil to surprise positively in 2015, possibly even in 2014.

China Only BRIC Country Currently Worthy of the Title -O&#8217;Neill - MoneyBeat - WSJ


----------



## RiazHaq

The relentless rout of the Indian rupee continued with the currency of the Asias third largest economy breaching the key level of 66.00 to the dollar on Tuesday, portending that its abysmal plunge to 70 is well nigh imminent.
The rupees steep plunge to a new all-time low of 66.24 from 64.30 on Monday was partly on fears over a US-led military strike in Syria, which could push oil prices higher globally, even as investors became more nervous over the astronomical cost of a new move by New Delhi to provide subsidised food to millions of Indians.

The inexorable dive of the rupee did little to cheer the bewildered non-resident Indians in the Gulf who are caught in a paradoxical situation with those who remitted the money over the past few weeks ruing over their loss as the fall of the currency continued unabated.

In 10 weeks or so, the partly convertible Indian currency lost 22 per cent of its value against the dollar-pegged dirham  from just over Rs14 per dirham in May to Rs18.21 on Tuesday.

The new bout of alarm over Indias fiscal deficit in the wake of the $20 billion food security plan eclipsed an announcement by Finance Minister P. Chidambaram that the government had approved infrastructure projects worth $28.38 billion, a step aimed at reviving economic growth and shoring up investor confidence.

Despite Chidambarams promise on Tuesday that the government would meet its fiscal deficit target, the rupee plumbed new depths.

Business - Indian rupee in free fall


----------



## fast

RiazHaq said:


> The relentless rout of the Indian rupee continued with the currency of the Asia&#8217;s third largest economy breaching the key level of 66.00 to the dollar on Tuesday, portending that its abysmal plunge to 70 is well nigh imminent.
> The rupee&#8217;s steep plunge to a new all-time low of 66.24 from 64.30 on Monday was partly on fears over a US-led military strike in Syria, which could push oil prices higher globally, even as investors became more nervous over the astronomical cost of a new move by New Delhi to provide subsidised food to millions of Indians.
> 
> The inexorable dive of the rupee did little to cheer the bewildered non-resident Indians in the Gulf who are caught in a paradoxical situation with those who remitted the money over the past few weeks ruing over their loss as the fall of the currency continued unabated.
> 
> In 10 weeks or so, the partly convertible Indian currency lost 22 per cent of its value against the dollar-pegged dirham &#8212; from just over Rs14 per dirham in May to Rs18.21 on Tuesday.
> 
> The new bout of alarm over India&#8217;s fiscal deficit in the wake of the $20 billion food security plan eclipsed an announcement by Finance Minister P. Chidambaram that the government had approved infrastructure projects worth $28.38 billion, a step aimed at reviving economic growth and shoring up investor confidence.
> 
> Despite Chidambaram&#8217;s promise on Tuesday that the government would meet its fiscal deficit target, the rupee plumbed new depths.
> 
> Business - Indian rupee in free fall



It's down to 68Rs now apparently. A higher oil price will widen India's CAD and further weaken the rupee. India is screwed royally from behind.


----------



## Chinese-Dragon

See, that makes sense.

India is cutting their defence budget because India's economy is shrinking in nominal terms.

India Cuts Defense Budget As Economy slows - WSJ.com

This year they actually have LESS money to buy foreign stuff than before. Their economy is shrinking in nominal terms because the Rupee is falling, and no one will accept payment in Rupees they'll want foreign currency.

Since India seems to be stuck at 3-4% economic growth, it seems they'll be getting weaker and weaker over the years.

In fact, I think Manmohan just hinted at cutting India's defence budget AGAIN:

Govt may cut down on defence budget: PM - Times Of India

Manmohan is a hero, he is going to destroy India's capability to defend itself.


----------



## walle990

India is screwed big time, china with its current rate of economic growth is struggling to create enough well paid jobs for its youth. 
India, which has countless times highlighted their young population base is headed for disaster if they can't even break away from the "hindu" rate of growth. 

The surge in social problems in India this year is almost certainly attributable to this.


----------



## MohitV

fools are jumping threads now....lol....get a life


----------



## Chinese-Dragon

MohitV said:


> fools are jumping threads now....lol....get a life



Remember you idiots started flaming first, we are only responding to the pathetic mess that calls itself India with hard facts that even Indians know themselves.


----------



## MohitV

Chinese-Dragon said:


> Remember you idiots started flaming first, we are only responding to the pathetic mess that calls itself India with hard facts that even Indians know themselves.


u were respected by most of the indian members here....but its u who took it from an indian traitor to gdp to poverty....cant u guys come up with something new??....crying about the same s*** again n again...yeah we know we have poor and our economy is not as strong as urz...but at least we do not jump threads like u r doing ryt now....coz we have a life to live....


----------



## Chinese-Dragon

MohitV said:


> u were respected by most of the indian members here....



They respect me because I talk sense.

Unfortunately, the Indian members here do not. Even the Indian President does not, look at this:

India to become superpower by 2012: Kalam - Economic Times


----------



## MohitV

Chinese-Dragon said:


> They respect me because I talk sense.
> 
> Unfortunately, the Indian members here do not. Even the Indian President does not, look at this:
> 
> India to become superpower by 2012: Kalam - Economic Times


talk sense ??!! u r nothing else but a despo.....wasting ur life jumping threads just to insult indians.....even though u know tat u guys are far better than us...and we know tat too.....


....looks like u r the only unique piece in china....as i know chinese are not like this...they are hard working people...they would never waste their time jumping threads like u are doing ryt now


----------



## Chinese-Dragon

MohitV said:


> talk sense ??!! u r nothing else but a despo.....wasting ur life jumping threads just to insult indians.....even though u know tat u guys are far better than us...and we know tat too.....
> 
> 
> ....looks like u r the only unique piece in china....as i know chinese are not like this...they are hard working people...they would never waste their time jumping threads like u are doing ryt now



Unfortunately I can't say the same for you Indians, you guys are worse than your President who said that India is a superpower in 2012.


----------



## MohitV

Chinese-Dragon said:


> Unfortunately I can't say the same for you Indians, you guys are worse than your President who said that India is a superpower in 2012.


good for u


----------



## Chinese-Dragon

MohitV said:


> good for u



Do you agree with your President that India was a superpower in 2012?


----------



## MohitV

Chinese-Dragon said:


> Do you agree with your President that India was a superpower in 2012?


no...neither india has the desire nor it can become a superpower...happy now ??


----------



## Chinese-Dragon

MohitV said:


> no...neither india has the desire nor it can become a superpower...happy now ??



Your President has more authority to speak on behalf of India than you do:

India to become superpower by 2012: Kalam - Economic Times


----------



## MohitV

Chinese-Dragon said:


> Your President has more authority to speak on behalf of India than you do:
> 
> India to become superpower by 2012: Kalam - Economic Times


good...like i care


well instead of jumping threads like a loser...u can start a new thread on it n continue wasting ur life...


----------



## Chinese-Dragon

MohitV said:


> good...like i care
> 
> 
> well instead of jumping threads like a loser...u can start a new thread on it n continue wasting ur life...



It's not my fault you Indians are so butthurt, next time don't flame my country if you don't want me to flame yours. 

Unless you are simply masochistic and you love being shown how awful your country is, in which case please continue.


----------



## MohitV

Chinese-Dragon said:


> It's not my fault you Indians are so butthurt, next time don't flame my country if you don't want me to flame yours.
> 
> Unless you are simply masochistic and you love being shown how awful your country is, in which case please continue.


i never said a shyt about ur country..


----------



## Chinese-Dragon

MohitV said:


> i never said a shyt about ur country..



Your fellow Indians did, and you guys got the reward for it.

We don't attack. We wait for Indians to attack, like with the Forward Policy. We win because we are the ones defending ourselves, not the ones trying to attack others.


----------



## MohitV

Chinese-Dragon said:


> Your fellow Indians did, and you guys got the reward for it.
> 
> We don't attack. We wait for Indians to attack, like with the Forward Policy. We win because we are the ones defending ourselves, not the ones trying to attack others.



oh...is tat so ???....nice


----------



## Chinese-Dragon

MohitV said:


> oh...is tat so ???....nice



Very much so, and I believe we will both see it again within the next decade or two.


----------



## MohitV

Chinese-Dragon said:


> Very much so, and I believe we will both see it again within the next decade or two.


see again??....u coming to india or wat ??

coz neither m in the army n m sure u r not in the army too.....so seeing u on border...no chance....na


----------

