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Indian economy is in a crisis: Study

You have no idea about what gdp is,and not a single "ghost city" could exist more than 5 years

By the way, it's company not chinese government put money on real estate.The goverment just sold the land to the company who want to invest it

Infrastructure boom mainly add to China's GDP growth and a part of it comes from project like Ghost cities, after investing in Ghost cities, high GDP growth targets are met.
 
Infrastructure boom mainly add to China's GDP growth and a part of it comes from project like Ghost cities, after investing in Ghost cities, high GDP growth targets are met.

Give me a favor and check out how GDP is calculated,if there's a ghost city and nobody lives in there,then it add zero to GDP,

And it's company not government investing.OK? Companies don't give a **** about high gdp growth target,they only care about their profit

You've watched too much western media
 
Infrastructure boom mainly add to China's GDP growth and a part of it comes from project like Ghost cities, after investing in Ghost cities, high GDP growth targets are met.
why don't you try that?it's a highway of your govt to get money,then with the money they get by selling lands they can invest more on infrastructure,building schools and hospitals,then sell lands around at times higher price.oh,more money got.go on to invest......simultaneously many industries benefit from the procedure,such as concrete,steel,machine building,chamical,glass,aluminum......many people get jobs and with the money they earned they buy houses,get better education for their children ,better medical care for their family.thats also the reason we don't have slums-everybody work hard for better life.everybody has equal chance to be rich for there is no caste system here,nobody is born to be dalit
 
Of course. We have skipped industrializing and went straight to a service economy. We will not grow until we have industry.
 
Trade deficit at seven-month high as gold imports surge

NEW DELHI | Mon Jun 17, 2013 8:59pm IST

Trade deficit at seven-month high as gold imports surge | Reuters

(Reuters) - India's trade deficit widened to a seven-month high in May as gold imports surged, provisional data showed on Monday, but economists expect newly announced measures to dampen demand for the precious metal in coming months and narrow the shortfall.

A nearly 90 percent annual jump in gold and silver imports saw the trade deficit rise to $20.14 billion last month from $17.8 billion in April.

The rise in gold import growth was slower than an annual 138 percent surge in April.

A combination of sliding global prices and regional festivals in India that traditionally increase demand for gold as gifts prompted frenzied buying in April and May. A similar pattern was seen in the world's other major bullion buyer, China.

This robust retail demand has become a major headache for Indian policymakers who have announced a slew of measures to try to narrow the current account deficit, which hit an all-time high of 6.7 percent of gross domestic product (GDP) in the December quarter.

India, the world's biggest buyer of the metal, hiked the import duty on gold to 8 percent earlier in the month from 6 percent. The central bank has also sought to curb gold imports by banks and non-banks.

"We expect gold demand and, hence, imports to be significantly lower in June, and possibly remain low in coming months," Barclays Capital said in a note after Monday's data.

"The widening in May might mark a near-term high for the trade deficit, and we think it could narrow significantly in June."

India has been struggling to control its current account deficit, which has exacerbated the fall of the rupee against the dollar in the recent global sell-off in emerging currencies.

The sharp depreciation in the rupee has also not helped Indian exports of value-added goods such as jewellery and pharmaceutical drugs.

Merchandise exports fell 1.1 percent from a year earlier to $24.51 billion, the first annual fall in five months, Monday's trade ministry data showed.

The sector makes up about 15 percent of the India's economy, which grew at its weakest pace in a decade in the fiscal year that ended in March.

Annual imports, meanwhile, rose about 7 percent in May to $44.65 billion, the trade ministry said.

The Reserve Bank of India left interest rates steady on Monday, warning of upside risks to inflation due to the weaker rupee and stressing the need to reduce the country's bloated current account gap to a sustainable level




Reserve Bank leaves rates unchanged; inflation risks weigh as rupee sags

Reserve Bank leaves rates unchanged; inflation risks weigh as rupee sags | Reuters

MUMBAI | Mon Jun 17, 2013 3:49pm IST
(Reuters) - The Reserve Bank of India kept interest rates unchanged on Monday as expected after cutting them in each of its previous three policy reviews, warning of upward risks to inflation as the rupee is among the hardest hit amid a global emerging markets sell-off.

The rupee touched an all-time low of 58.98 to the dollar last week as investors worried about India's record-high current account deficit and were unimpressed by government efforts to boost investment.

The RBI said food prices and the falling currency pose inflationary risks, and also called for vigilance over global economic uncertainty, citing the risks of a reversal of capital flows like the one that has roiled emerging markets in recent weeks.

Last week, Indonesia responded to outflows and market volatility by unexpectedly raising interest rates - the first Asian central bank to do so since 2011 - in a bid to support its currency, while Brazil said it would scrap a tax on foreign exchange derivatives as the real weakened.

Other major developing countries with large foreign financing needs such as South Africa and Poland are also seen at risk.

"The RBI was slightly hawkish but with the rupee under pressure to weaken, the tone was appropriate," said Suresh Kumar Ramanathan, head of regional interest rates and FX strategy at CIMB in Kuala Lumpur.

The current account deficit hit 5.4 percent of GDP in the April-December period, exacerbating pressure on the rupee.

"As long the rupee is under pressure, RBI will hesitate to ease anytime soon," Ramanathan said.

The Indian central bank left its policy repo rate unchanged at 7.25 percent and kept the cash reserve ratio (CRR), or the share of deposits banks must keep with the central bank, steady at 4.00 percent, despite some signs of moderating inflation in recent months.

"It is only a durable receding of inflation that will open up the space for monetary policy to continue to address risks to growth," the RBI said in a statement.

Indian markets were little affected by the policy decision. The 10-year bond yield briefly fell, while the Sensex extended losses to trade down 0.4 percent. The rupee was trading largely unchanged from pre-statement levels, at around 57.80/81 per dollar, but still down more than 4 percent for the year to date.

Still, economists said there remains room for moderate policy easing in coming months.

"What the RBI is looking at is not just a couple of months of improving inflation but something that is much more lasting," said Rajeev Malik, senior economist at CLSA in Singapore, who expected a rate cut in the July policy review but none thereafter in the near term.


PRICE PRESSURES LOOM

A Reuters poll released on Thursday showed 28 of 38 analysts expected the RBI to hold the repo rate steady and 30 of 34 saw the CRR unchanged.

The RBI left rates on hold despite headline wholesale price index inflation that fell to 4.7 percent in May, within its comfort zone, and further signs of economic weakness.

The economy expanded by just 5 percent in the fiscal year that ended in March, its weakest in a decade.

Trade deficit in May widened to $20.1 billion from $17.8 billion a month ago, a trade ministry official said on Monday, amid high imports of cheaper gold, increasing pressure on the current account balance.

Imports rose about 7 percent from a year earlier, while exports fell 1.1 percent, the first annual fall in five months.

While noting that inflation had eased, the central bank warned of looming price pressures.

"Upside pressures on the way forward from the pass-through of rupee depreciation, recent increases in administered prices and persisting imbalances, especially relating to food, pose risks of second-round effects," the RBI said.
 
By PTI | 16 Jun, 2013

NEW DELHI: The Indian economy is in a crisis with growth slowing down,


......

The NCAER study said there is a need to boost exports of merchandise and hence lower the deficit on balance of trade.

As per the study, manufacturing in India is still not internationally competitive in several sectors of production.

"Some long-term factors that need attention involve infrastructure, labour laws and governance reforms...moving to goods and services tax ( GST) would add to India's global competitiveness in manufactured goods," NCAER said.

It further said India should play a pro-active role in strengthening its trade integration with other Asian nations.

"India's trade and investment relations with Asia will play a major role in boosting its exports in the Asian century," the study said.

Also, India should strengthen its bilateral agreements and help bring about foreign trade agreements in groupings such as ASEAN+6 nations, it added.

The six countries outside ASEAN are Australia, China, India, Japan, South Korea and New Zealand.

Indian economy is in a crisis: Study - The Times of India




It is important to note that specific exports to US/EU have slowed down, that means a negative impact on all the economies relying on such exports.

That means Indian economy has slowed down, and so had Chinese.

However the rate of decline is different for several different factors.


I say this now and I have said in the past.


India is remains a second rate country because it has a caustic relationship with two of its largest neighbors.

The Indians realized that you get more people attracted if you use honey instead of pepper spray, that day India will become much more economic power than what it is today.


Our company does active business with India and China.

Travel to China is much more fun compared to sending people to India or inviting people/engineers from the two countries.

So what I say here is not out of malice or anger. Just pure business facts.


peace
 
its rare to see a mod opening a thread on banned topic

that too when a similar thread was already opened and instead of punishing rule breakers you brake rules yourself great....
 
its rare to see a mod opening a thread on banned topic

that too when a similar thread was already opened and instead of punishing rule breakers you brake rules yourself great....

It will be a ill-consideration to have economic topics banned. No economy no military defense!

It may be appropriately merged or remained open for as long as the Mods think fit!
 
To be quite honest, I'm doing an advanced macro unit at uni right now, I'm no expert but all the signs coming from India right now is that it's economy is heading for stagflation.

One feels for the millions that are going to be left behind because of the lack of reform, 3-5 years ago when it was required.
 
To be quite honest, I'm doing an advanced macro unit at uni right now, I'm no expert but all the signs coming from India right now is that it's economy is heading for stagflation.

One feels for the millions that are going to be left behind because of the lack of reform, 3-5 years ago when it was required.

Stagflation I don't think so.Growth rate is around 5% and inflation below 5% ,But there is a possibility of imminent Balance of payment crisis.It all depends on US Feds QE withdrawal plans.Since western countries currently have ridiculously low Bond yields western companies are pouring money in to Asian Economies.Countries like India which has high current account deficit are particularly depended on such volatile flows.If US fed reverses QE and hike the policy rates.There might be an immediate outflow of dollar from Indian markets.No one knows whether it will be a short term pull out or long term one.If indeed its latter one,We may be looking at a full blown BOP crisis like the one we had in 1991 since our Currency reserves are only enough for 6 months imports.Rest assured it will all be depended up on US Fed's decision on the future of QE program and how well we can attract FDI and FII in coming months.
 
It is important to note that specific exports to US/EU have slowed down, that means a negative impact on all the economies relying on such exports.

That means Indian economy has slowed down, and so had Chinese.

However the rate of decline is different for several different factors.


I say this now and I have said in the past.


India is remains a second rate country because it has a caustic relationship with two of its largest neighbors.


The Indians realized that you get more people attracted if you use honey instead of pepper spray, that day India will become much more economic power than what it is today.


Our company does active business with India and China.

Travel to China is much more fun compared to sending people to India or inviting people/engineers from the two countries.

So what I say here is not out of malice or anger. Just pure business facts.


peace

The same goes with Pakistan.Increased cross border trade between India and Pakistan can bring great prosperity to the region,Everybody knows this.And what is making Pakistan to block India's access to Central Asia and Its resources.Yes India has problems with China,But when it comes to business it can all be swept aside,That's why China is the largest trade partner of India.But same can't be said about Pakistan where trade relations so pathetic,Indirect trade between India and Pakistan is much higher than Direct trade.So instead of blaming India here you should look in to your country's policy.Why no MFN status to India,Why bilateral trade is low??By any means of Logic India should be Pakistan's largest trading partner and India should be Pakistan's largest FDI investor.
 
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