Indian Economy - News & Updates - Archive

[Screaming Skull]

RBI issues a new Rupees ten coin​

Jingle, jingle! RBI issues a new Rupees ten coin

New Delhi: The Reserve Bank of India (RBI) has issued a new coin for the denomination of Rupees ten. The new coin has been based on the theme of 'Unity in Diversity'.

It has an outer ring metal composition. It’s bi-metallic or simply put, made up two metals.

The face of the coin is divided into three portions. The central portion bears the "Lion Capitol" of Ashoka Pillar.

RBI says the new coin is a stylised representation of "Unity in Diversity", a defining characteristic of India.

 

[LCA]

Highest ever GSM additions in March

Highest ever GSM additions in March

BS Reporters / New Delhi April 14, 2009, 0:22 IST

The telecom juggernaut continued unabated despite an economic slowdown, with GSM technology service providers setting a new record by crossing the 10-million subscriber mark in March.


In January this year, GSM players had recorded a 9.69 million increase in subscriber numbers, which included Reliance Communications’ figures.

According to figures released by the Cellular Operators Association of India (COAI) today, GSM players added 10.84 million new subscribers in March, taking total GSM subscriptions for the fiscal year to 288.3 million. GSM services account for around 75 per cent of mobile subscriptions.

The numbers exclude subscriptions for Reliance Communications, the CDMA service provider that recently launched GSM services, because the company does not reveal GSM numbers separately.

If the estimates of 2.5 million to 2.7 million GSM subscribers for Reliance Communications are added, the total monthly increase for GSM subscriptions will be 13.54 million.

At this rate, India’s GSM subscriber base is growing at more than double the monthly growth rate of China, which is adding around 6 million customers every month. With over 600 million mobile customers, however, China is far ahead of India in terms of the mobile subscriber base.

“Though March has more days and companies push sales at the end of the financial year, we expect to see monthly incremental growth of 14 to 15 million consumers in 2009-10. Our estimate is that mobile penetration will go up from 35 per cent currently to 50 per cent by the end of this financial year,” said TV Ramachandran, COAI secretary- general.

The COAI has predicted that India will have around 500 million GSM subscribers by the end of 2009-10 and over 800 million by 2012 . The country would hit the one billion market in a few years after that, the COAI said

 

[Neo]

India March exports down 31pc ​

Tuesday, April 14, 2009

NEW DELHI: India’s exports fell for a sixth straight month according to the latest provisional estimate for March, and are likely to extend the fall till September before recovering, the trade secretary said on Monday.

Recession in developed economies crimped demand for Indian goods and export growth slowed to 7.3 percent in April-February to $156.6 billion from a year earlier, sharply lower from close to 20 percent seen in 2007/08.

“March exports, we have only the provisional estimates...It is just under $12 billion,” G K Pillai told reporters, adding it would be about 31 percent lower from the previous year. “This negative growth will continue up till September. Then, you will find a positive growth.”

The demand for Indian goods in Latin America and South-east Asia remains “quite high”, but it needs to pick up in U.S. and Europe, which consume about 35 percent of Indian exports, he said.

The final figures for 2008/09 exports is seen touching a lower revised annual target of $170 billion and may remain flat at that level in 2009/10, he said. While exports, which make about a fifth of India’s gross domestic product, have been contracting since October, imports started falling from January as slowing demand at home cut import of capital goods and lower global crude prices slashed the fuel bill.

Pillai said India’s imports may have fallen 37 per cent in March. On Monday, Prime Minister Manmohan Singh said Indian economy may have grown slightly below 7 per cent in 2008/09, its slowest pace in the last six years, with analysts forecasting a further contraction in the current fiscal.

 

[Neo]

Indian economy grew less than 7% in FY09: PM​

MUMBAI: India’s economic growth slowed to slightly less than seven percent in the 2008/09 fiscal year that ended in March due to the impact of the global downturn, Prime Minister Manmohan Singh said on Monday.

“We have recorded a growth of nine percent in the first four years of our government. Last year, because of the impact of global recession, the growth rate will be slightly less than seven percent,” Singh told a televised news conference.

High borrowing costs and followed by the global crisis slowed Asia’s third largest economy last year, and analysts forecast less than 6 percent expansion in the current year to March 2010. A contraction in demand at home and abroad has cut India’s factory output and exports sharply since October.

India’s industrial output contracted 1.2 percent in February from a year earlier and exports were down more than a fifth. “The global economy is in deep trouble and we are affected by it. But because of the measures we have taken, we had anticipated something of this sort, the effect on our economy is not as great as the impact on many other countries,” Singh said.

On Monday, the trade secretary said provisional data shows exports down by about 31 percent in March from a year earlier, and it was likely to remain subdued in the next six months as global trade flows are seen contracting in 2009. India’s central bank has cut interest rates by 400 basis points since October, while the government has slashed duties and increased public spending to stimulate a slowing economy.

Policy makers are now debating on the need for more rate cuts and fiscal stimulus to revive growth. Some analysts expect the central bank to cut rates further when it reviews its policy on April 21.

A decision on further fiscal stimulus could be expected only after the April/May elections are over and a new government assumes office. Last month, the care-taker government said it will sell 2.41 trillion rupees ($48.2 billion) of bonds in the first half of 2009/10, two-thirds of its full-year target, anticipating higher spending needs in the coming months to revive growth.

In February, India revised upwards its fiscal deficit target to 6 percent of gross domestic product for 2008/09, from 2.5 percent earlier, as market borrowings surged in March quarter. It is estimated at 5.5 percent of GDP for 2009/10 fiscal year.

 

[Screaming Skull]

Russia offers India role in uranium centre project​

New Delhi, April 14: Russia has offered India the option of participating in its International Uranium Enrichment Centre (IUEC) at Angarsk, Siberia as a means of securing guaranteed fuel supplies in the future.

This was communicated to a visiting Indian delegation to Russia, headed by the Atomic Energy Commission Chairman, Dr Anil Kakodkar, on April 9.

The offer, made during deliberations between the two sides, includes investment possibilities for India in the IUEC, which is being set up under International Atomic Energy Agency (IAEA) supervision, sources said. The investments could be considered in lieu of India paying for nuclear fuel to be supplied to the Russian-built Koodankulam Light Water Reactor units and to existing Indian pressurised heavy water reactor units that are to be fuelled by Russian firm TVEL under a bilateral pact.

The enrichment centre is being set up by Russia for supply of uranium to countries with nuclear energy programmes under the IAEA safeguards. Russia is establishing the project in collaboration with countries such as Kazakhstan under the supervision of the nuclear watchdog at the Angarsk Electrolysis Chemical Plant in Eastern Siberia.

The Indian delegation visited the Angarsk Plant, which hosts the IUEC, and nuclear fuel supplier TVEL’s JSC Novosibirsky Chemical Concentrates Plant. According to sources, the Director of Angarsk Electrolysis Chemical Plant, Mr Alexander Belousov, made a pitch for India to invest in the IUEC project. The participation by India in the project, he said, would tackle the problem of guaranteed nuclear fuel supply to ensure safe and reliable operation of the Indian nuclear sector, according to sources.

Proposals regarding joint fundamental research were also discussed during the talks. Dr S.K. Jain, Chairman and Managing Director of the Nuclear Power Corporation of India Ltd, and Mr R. Gupta, Uranium Corporation of India Ltd chief, were also part of the Indian delegation.

Earlier, at the delegation level talks between India and Russia during the Prime Minister, Dr Manmohan Singh’s Moscow visit in 2007, the Russians had indicated at the possibility of India investing in the proposed centre. Subsequently, however, there were reports of a rethink within the Russian government on Nuclear Non-Proliferation Treaty membership being considered as a prerequisite for IUEC participation.

The Angarsk facility has traditionally been associated with Russian civilian nuclear programme and had been kept completely out of the erstwhile Soviet Union’s atomic weapons plan, thereby, making it easier for the plant to be put under IAEA control.

The enrichment centre would produce only low-enriched uranium, which cannot be diverted for building nuclear weapons. Uranium enriched to low levels can be used as fuel for nuclear power plants, but higher levels of enrichment make it possible to divert the fuel for the construction of the core of a nuclear bomb.

The Hindu Business Line : Russia offers India role in uranium centre project

 

[Screaming Skull]

L&T signs MoU with Russian co for nuclear reactors ​

MUMBAI: Larsen & Toubro (L&T) has signed a Memorandum of Understanding (MoU) with Atomstroyexport (ASE) of Russia for co-operation for Russian design reactors VVER 1000. The MoU was signed by Mr. M V Kotwal, Member of the Board & Senior Executive Vice-Pr esident of L&T and Mr. Dan Belenkiy President ASE in Moscow.

The MoU would form the basis of co-operation between the companies and address needs for equipment and other services arising from the agreement signed between India and Russia on December 5, 2008, for four additional reactors KK3-6 at Kudankulam in Tami l Nadu and other Russian reactors at new sites in India, the company said in its BSE press release .

L&T has been playing a leading role in equipment manufacturing, construction and project management for pressurized heavy water reactors in domestic nuclear programme.

 

[Screaming Skull]

RBI knows banking better than US Fed: Nobel laureate​

April 15, 2009

New York: Nobel laureate Joseph Stiglitz complimented the Reserve Bank of India last week for resisting pressures to deregulate the banking sector.

Stiglitz, a professor at Columbia University, said one reason India is "one of the least dark spots" in the gloomy global economic scenario is that its central bank has resisted such moves.

Stiglitz said India had largely averted a crisis that felled the United States because India's central bank did not act like its counterpart in the United States.

"The Indian central bank understands central banking and regulation much better [than the US Fed]. . . There were some political pressures to deregulate and RBI resisted some of those pressures," Stiglitz said.

"Now I think the financial markets are thankful that India's central bank did resist those pressures. The result is that India's financial markets are in better shape than they would have been if the RBI allowed wholesale deregulation [the way the] United States has done," he said, while keynoting the India Conference at the Columbia University.

The 2009 conference was organized by the Columbia Business School's South Asian Business Association.

Noting that although developing countries, especially India and China, are doing much better than the rest of the world, including the US, Stiglitz said one should not believe the effect of the US economic downturn would not affect emerging economies worldwide.

Stiglitz said that about an year ago people used to talk about de-coupling, meaning that emerging economies, especially that of India, are not linked to the global economy and so any downturn would not spread to countries like India and China.

"I always thought that that was a myth, and today it seems that the downturn in the world's largest economy has to have global implications and that is what is happening today. We are tied by a whole set of connections -- capital markets, export markets, labour, all that. . .," Stiglitz said, adding that India's economy is likely to continue growing but at a slower rate than before the crisis.

Asked how long the global crisis would continue, he said there were actually two crises: "A financial crisis and a conventional economic crisis. When the origin of the crisis lies in the financial sector, typically, downturns are a deeper and longer and this is a very severe serious financial sector crisis. And we can expect a very long and difficult period of recovery," he said.

Stiglitz justified his pessimism, giving the example of the economic downturn that hit some Asian countries in 1997-98. They were able to recover quickly, partly because there was demand for their exports. But now, countries like the US cannot rely on exports because markets everywhere are weak, he said.

Stiglitz said that today the US is not doing a good job of fixing its financial system.

"It is not likely to work. We are spending huge amounts of money that will put taxpayers in much worse shape. It is being done in a very non-transparent way that is undermining people's confidence in the government. Even after we fix the financial problem, the recovery is not going to be very robust," he said.

 

[Screaming Skull]

India is less affected in global turmoil: Fidelity's Bolton​

16 Apr 2009,

MUMBAI: India’s economy is largely domestic consumption-led and accordingly it has been less affected by the deceleration in global growth. As an economy that has continued to grow in spite of the unprecedented turmoil in the global economy, "I think India is well placed to benefit from an improving global environment," according to Anthony Bolton, President, Investments at Fidelity International, who was speaking in a press conference here on Thursday.

Commenting on next market bull run, Bolton said, “the market is bottoming out. It is underlined by attractive valuations, market sentiment and by looking at current market conditions in relation to the historical bear and bull market cycles. I would be overweight consumer cyclicals, technology, financials and value stocks.”

He further added, valuations of shares are particularly attractive and investor sentiment is so poor at the moment that I believe the long bear market is over.

Anthony Bolton managed the Fidelity Special Situations Fund, the best-performing UK retail investment fund for 28 years since 1979.

 

[Screaming Skull]

Indian investors most optimistic in Asia in Q1: ING survey​

NEW DELHI: Indian investors have emerged as the most optimistic lot in Asia and along with their Chinese counterparts have driven an increase in
the region's overall investor sentiment in the first quarter of this year, a latest survey says.

The quarterly Investor Dashboard Sentiment survey by global financial services group ING shows a significant increase of 75 per cent in investor sentiment in India in the first three months of 2009 as compared to the fourth quarter last year.

"Despite a slowdown in global economies and volatility in international financial markets, the ING Investor Dashboard Sentiment Index for India reflects the highest level of investor optimism across Asia," the survey stated.

The India investor index has jumped 75 per cent to 133 in Q1 this year from 76 in fourth quarter of 2008.

The survey indicated that Indian investors were confident about the economy, backed by assurances from the business community and the government.

"Compared with its neighbours in Asia, India's growth of recent years has been driven predominantly by domestic consumption as well as domestic investment. This pattern and growth insulates economy from set backs felt in both global & regional economies," ING Investment Management India acting CEO Navin Suri said.

 

[LCA]

http://economictimes.indiatimes.com...s-slowest-in-10-years/articleshow/4411952.cms

China's GDP grows slowest in 10 years
17 Apr 2009, 0019 hrs IST, Bloomberg

Print EMail Discuss Share Save Comment Text:
BEIJING: China’s economy, battered by collapsing exports, grew at the slowest pace in almost 10 years, probably marking its low point. Gross
domestic product expanded 6.1% in the first quarter from a year earlier, after a 6.8 % gain in the previous three months, the statistics bureau said in Beijing.

A 30% surge in urban fixed-asset investment in March and a jump in industrial output, both reported on Thursday, added to evidence that the government’s 4 trillion yuan ($585 billion) stimulus plan is working. Premier Wen Jiabao cautioned that while the world’s third-biggest economy is in better-than- expected shape, China is yet to establish a solid foundation for a recovery.

“They’ve stabilized the economy and now the challenge is to think about how to support consumption and how to support private investment,” said Stephen Green, head of China research at Standard Chartered Plc in Shanghai.

“We’re still looking for stimulus measures to encourage consumption.” The report follows a statement from US Treasury Secretary Timothy Geithner that China isn’t a currency manipulator. His stance eases pressure on China to allow its currency to rise, which would hurt efforts to revive exports.

While stimulus measures have started to produce results, China faces faltering export demand, industrial overcapacity, unemployment and weak private investment sentiment, Wen said in a statement after a meeting of China’s cabinet.
Industrial output expanded 8.3% in March from a year earlier, up from 3.8% in the first two months. Retail sales rose 14.7%. Consumer prices fell 1.2% in March from a year earlier, compared with a drop of 1.6% in February. Producer prices fell 6%, the most since Bloomberg data began in 1999.

China’s expansion was the weakest since the fourth quarter of 1999, according to Bloomberg data, and less than the 6.2% median estimate of 13 economists.

 

[LCA]

The Statesman

Will India overtake China’s growth rate?

Press Trust of India
NEW DELHI/BEIJING, April 16: China today said its economy in first three months of 2009 grew by 6.1 per cent, its lowest rate in over a decade, thus raising apprehensions about the communist nation losing its status as the world's fastest growing economy to India.
While the official figures for growth in India's gross domestic product during the first three months of 2009 is not available as yet, the country's economy is estimated to have grown by 7.1 per cent in the fiscal ended 31 March.
Given a steeper decline than India in China's GDP growth rate, which stood at 13 per cent in 2007 and fell to nine per cent in 2008, some experts opined that it would be interesting to watch which of the two economies grow faster going ahead.
Asked if China's GDP growth rate could fall below that of India's, Standard & Poor's chief economist for Asia Pacific, Mr Subir Gokarn said over telephone that it was “quite likely in one particular quarter”, but on a yearly basis it might not be the case at least this year.
“In the long run, say five years, yes,” opined Mr Nagesh Kumar, director general, Research and Information System for Developing Countries (RIS).
“In 2009 and 2010, India will roughly be at similar levels of economic growth rate... In the long run, we are sure to overtake China's growth rate as India has more headroom,” he added.
In an official release, China's National Bureau of Statistics said its GDP grew by 6.1 per cent in the first quarter of 2009, from 10.6 per cent in year-ago period and 6.8 per cent in the previous quarter. The GDP growth rate for January-March quarter of this year is lowest since 1992.

 

[Screaming Skull]

Indo-Canadian nuclear deal soon: Montek Ahluwalia​

Toronto April 17, 2009,

After sealing nuclear fuel supply deals with Russia and France, India is "very close" to inking a similar agreement with Canada.

With New Delhi planning to import reactors upto 20,000 MW of capacity in next 10 years, it has laid down a road map for strategic partnership with Ottawa and is "very close" to signing a nuclear cooperation agreement, Montek Singh Ahluwalia, Deputy Chairman of Planning Commission said here.

"This offers a major market opportunity to Canadian firms to sell nuclear reactors, fuel and technology for safeguarded nuclear reactors but they have to compete with France, the US, Russia and Australia," Ahluwalia said at a three-day Indo-Canada Energy Conference.

"Both countries are very close to signing a bilateral nuclear cooperation agreement. A joint study group is working on Free Trade Agreement," Ahluwalia said.Commending Canada's efforts at the nuclear supply club, Ahluwalia said, India is committed to restart closer nuclear cooperation with the country.

He also invited Canadian help in providing clean coal technology, non-renewable energy sources like solar and wind energy to help improve India's energy security.

Canadian Minister for Natural Resources Lisa Raitt said Canada, which is the fifth largest producer of energy, was committed to strengthening energy relations with India and "both countries are working a bilateral nuclear cooperation agreement".

"India's strategic plan is to import nuclear reactors that could generate 20,000 MW of power based on imported uranium," Ahluwalia said. "Plutonium generated from these reactors would be fed into fast breeder reactors that could end up generating more plutonium."Once India has sufficient plutonium that would put into thorium based reactors to generate power, India has large source of thorium that can only be used if the country has sufficient plutonium," he said, while outlining India's strategic plan for its energy security.

Later, Ahluwalia told newsmen that India was actively involved in two working groups set up by G-20 countries, which would lay down global standards for international financial security.Top executives of over 100 Canadian companies and top policy makers and energy sector companies from India are participating in the three day conference.

Earlier, former President Abdul Kalam addressed the delegates through video conferencing and said India and Canada could work together and realign themselves in solar, wind, nuclear and bio-fuels, municipal waste management areas.S R Gavai, the Indian High Commissioner said alleviation of poverty was a major challenge for India and Canada could play an important role in strengthening its energy security.

 

[Screaming Skull]

I hope at least now people understand the importance of the Indo-US Nuke deal. This was very important not only for immediate energy requirements but also for future energy security.

 

[Gabbar]

'India's GDP to fall to 3.4% in 2009'

New Delhi:
India's economic growth rate is expected to fall drastically to 3.4 per cent this year, economic forecasting consultancy Oxford Economics has said.
According to Oxford Economics' forecast, India is expected to report a GDP growth of 3.4 per cent in calendar year 2009, a drastic fall from the 9.2 per cent in 2007 and 7.4 per cent in 2008.

"As we enter the second quarter of 2009, the first indication, that the rate of decline of global output may be slowing, is becoming apparent," Oxford Economics said in a report.
Meanwhile, China, which reported a 13 per cent growth in 2007, is likely to grow 5.8 per cent in 2009. Though China is also expected to report a massive fall in GDP, it would not be as drastic as India's.

China yesterday said its economy in the first three months of 2009 grew by 6.1 per cent, its lowest growth rate in over a decade.
Emerging Asia is expected to grow by 1.5 per cent in 2009, the report said.
India recorded a growth rate of 9 per cent in fiscal 2007-08, which as per the Central Statistical Organisation's advance estimate of national income, is likely to moderate to 7.1 per cent during 2008-09.

 

[Gabbar]

India invests in infrastructure

Growth in Indian air traffic over recent years has prompted capacity expansion and new-build airport projects.

One market forecast predicts that passenger traffic at Indian airports will grow at an annual rate of 15 per cent, from 102.73 million in 2008 to 290.19 million by 2014. In recent years the growth forecast by state-owned Airports Authority of India (AAI) has varied between 7 per cent and 9 per cent, but this has lately been toned down to 6 per cent as a reflection of the economic conditions.

Predicted growth in the cargo sector has also been revised downwards as the Indian aviation sector mirrors forecast slower GDP growth for 2008-10. Cargo volumes grew on average by 7.5 per cent annually between 2004 and 2008, with 1.71 million tonnes of freight being handled in 2007-08.

While a pessimistic outlook appears justifiable, some take a more balanced view of the Indian air traffic situation. "I don't think you should see that [traffic growth] as coming to a halt by any means," says Richard Chinn, New Delhi-based project director for aviation at management and engineering consultancy Mott MacDonald India. "We have to understand that we are now seeing an adjustment to a more normal growth pattern, after the abnormal growth caused by pent-up demand. But this does have consequences for new construction, since airport facilities have been planned with higher passenger traffic and cargo growth in mind."

India invests in infrastructure