Indian Economy-News & Updates

[Abhishek_]

Reliance Industries to invest Rs 1.5 trillion in 3 years

Reliance Industries on Thursday announced an investment of Rs. 1.5 lakh crore in core business of petrochemicals and oil and gas as well as in retail and telecom sectors in the next 3 years.

Addressing company shareholders, Reliance Industries Limited (RIL) Chairman and Managing Director Mukesh Ambani said, “Reliance has embarked upon its largest investment programme in its history.”

The investments span oil and gas exploration and production, refining and marketing, petrochemicals, retail and broadband and digital services, he said.

RIL is aiming to be “among top 5 petrochemical producers in the world,” he said adding the petrochem capacity is being expanded to 25 million tonnes from 15 million tonnes per year.

Mr. Ambani had in the last Annual General Meeting (AGM) announced an investment of Rs. 1,00,000 crore over 4-5 years, which has now been expanded to Rs. 1.5 lakh crore and time compressed to 3 years.

While RIL’ partnership with U.K.’s BP has started delivering results with a significant gas discovery being made 2-km below the currently producing fields in KG-D6 block, the company is now looking at quickly bringing into production satellite fields in the flagging block and nearby areas.

Also, it is looking at beginning production from its Sohagpur coal-bed methane (CBM) blocks in Madhya Pradesh by 2015, he said.

While Mr. Ambani did not give a roadmap for launch of telecom services, he said the telecom business unit will increase headcount to 10,000 next year from 3,000 currently.

The unit, Reliance Jio Infocomm, is the only company to have nationwide permits for 4G broadband services, but is yet to start commercial services.

“We are making these investments at a time when the global economy is facing one of its most challenging period in modern times. Most of economies are faced with slowdown, high unemployment and lack of visible growth triggers,” he said.

“Reliance is making significant investment in all five businesses simultaneously — exploration and production, petroleum refining and marketing, petrochemcial, retail and broadband and digital services,” Mr. Ambani said.

Mr. Ambani said 4G telecom services would be pillared on “affordability and providing an unparallel range of services that do not exist today.”

“In the coming years Reliance Jio’s next generation digital infra and services platform will catalyse a transformation and will embrace almost every facet of India’s economic growth and social progress,” he said.

He said revenues for RIL’s investments in U.S. shale gas ventures has doubled.

RIL’s retail business has crossed Rs. 10,000 crore revenue and has achieved break-even.

Reliance Industries to invest Rs 1.5 trillion in 3 years | The Hindu

 

[cloud_9]

Gross direct tax collections up 8 %

Led by strong growth in personal income tax collections, gross direct tax collections increased by 8.01 per cent to Rs.4.28 lakh crore in the first nine months of the current fiscal from Rs.3.97 lakh crore in the same period in the previous year, according to a Finance Ministry statement.

Personal income tax collections grew at a healthy rate of 14.57 per cent as gross collections from this segment increased to Rs.1.44 lakh crore during the review period from Rs.1.26 lakh crore in the same period last year.

Gross collections of corporate taxes showed an increase of 4.94 per cent at Rs.2.83 lakh crore (Rs.2.70 lakh crore).

Growth in net collections of wealth tax was 1.55 per cent at Rs.656 crore (Rs.646 crore).

However, net Securities Transaction Tax (STT) collections declined by 12.46 per cent to Rs.3,294 crore (Rs.3,763 crore).

Despite slowdown in economic activities, the government had said it was confident of meeting the Rs.5.70 lakh crore direct tax collections target for the current fiscal.
Net direct tax

Net direct tax collections (gross minus refunds) were up by 13.7 per cent to Rs.3.68 lakh crore (Rs.3.24 lakh crore).

Faced with widening fiscal deficit, the government had earlier issued stern warning to tax evaders and had asked them to disclose their correct income and pay advance tax by due date or be prepared to face action.

The government had also warned evaders of excise, Customs and service tax to pay their dues or face penal action which could include arrest, prosecution and property attachment.

If you make the Tax filling system easier for tax payers,they won't shy away from paying their tax.

 

[Abhishek_]

India's Apollo Tyres to buy Cooper Tire for $2.5 billion

(Reuters) - India's Apollo Tyres Ltd (APLO.NS) agreed to buy U.S.-based Cooper Tire & Rubber Co (CTB.N) for about $2.5 billion in a deal that would make it the world's seventh-largest tire maker and reduce its dependence on a slowing Indian auto market.

The acquisition of Cooper -- the second biggest U.S. tire maker and No. 11 globally with annual sales of $4.2 billion -- will give Apollo access to the U.S. market for replacement tires for cars and light and medium trucks, Cooper's main business.

Apollo, which currently gets two-thirds of its revenue from India, will pay $35 per share, representing a premium of about 43 percent to Cooper's Tuesday close.

"It is very important for us to expand our horizons. Especially in the long run, the U.S. market is going to look up ... ," Apollo Chairman Onkar Kanwar said on a conference call on Wednesday.

The deal is the latest in a string of big overseas acquisitions by Indian companies in recent years, including Tata Motors Ltd's (TAMO.NS) $2.3 billion purchase of Jaguar Land Rover and mobile operator ****** Airtel Ltd's (BRTI.NS) $9 billion takeover of the African operations of Kuwait's Zain.

It is also another example of an Asian company buying a well-known U.S. firm, coming just two weeks after China's Shuanghui Group agreed to buy Smithfield Foods (SFD.N) for $5 billion.

"The U.S. is an untapped market for Apollo. And the U.S. market is obviously big, and among the developed markets, it is the only one that is growing significantly," said Nishant Vass, auto analyst, at Mumbai-based brokerage ICICIdirect.

Indian car sales fell 7 percent in the financial year that ended in March, the first annual fall in a decade, while sales in Europe, Apollo's second-largest market, are at a 20-year low.

But auto sales are one of the bright spots for the U.S. economy. Sales in the second biggest auto market after China rose more than expected in May as construction workers and oil drillers bought more pickup trucks, and they are expected to remain strong for the rest of the year.

INDUSTRY CONSOLIDATION UNLIKELY

The deal values Cooper at 4.4 times its EBITDA (earnings before interest, tax, depreciation and amortization), which Apollo said was within the range of 3.5 to 6 times multiples seen in recent transactions in the sector.

Cooper's main investors are institutions, topped by BlackRock Institutional Trust Co and Vanguard Group Inc with about 7 percent stake each.

Cooper shares were up 40 percent at $34.46, just below the offer price, in early afternoon trading on the New York Stock Exchange.

Shares of Goodyear Tire & Rubber Co (GT.O), the biggest U.S. tire maker, rose on the news but an analyst said it was unlikely the Cooper sale would trigger more deals in the industry.

"... The top of the market is already consolidated," Morgan Stanley analyst Ravi Shanker said on a note to clients.

Findlay, Ohio-based Cooper employs nearly 13,000 people around the world. Apart from North America, it has manufacturing facilities in England, Serbia, Mexico and China.

Kanwar has expanded Apollo, which had revenue of $2.5 billion in 2012, after taking control of the company in 2002, following a prolonged public spat with his father, who founded the company in 1976.

His previous acquisitions include South Africa-based Dunlop Tyres International Ltd in 2006 and Dutch tire-maker Vredestein Tires in 2009.

Reuters and others reported in October that Apollo and Cooper were in talks for Apollo to take a stake in the company.

Apollo said it would raise $2.5 billion in new debt to fund the deal, of which $2.1 billion would be through the issue of dollar bonds with a tenure of seven to eight years.

Cooper, whose roots go back a century, is known for brands including Cooper, Avon, Mastercraft, Dean and Starfire.

Apollo said it would launch some Cooper brands in the Indian market, but did not give a specific timeframe.

The company said it plans to keep Cooper's management.

Apollo shares closed up 2.7 percent at 91.95 rupees in Mumbai trading ahead of the announcement.

Morgan Stanley & Co, Deutsche Bank Securities and investment firm Greater Pacific Capital advised Apollo on the deal. Bank of America Merrill Lynch was financial adviser and Jones Day was legal adviser to Cooper.

(Editing by Saumyadeb Chakrabarty)

India's Apollo Tyres to buy Cooper Tire for $2.5 billion | Reuters

 

[cirr]

OMG,11 billion!huge!India is on the way to superpower

You must bear in mind that these people are coming up from a very low base。

Everything achievement，however tiny it might be，counts in the eyes of those who are on the lower rungs of the ladder。

 

[Abhishek_]

KMCL, DMRC ink monorail pact

Overcoming several hurdles, Kerala Monorail Corporation Ltd (KMCL) on Wednesday signed the general consultancy agreement with the Delhi Metro Rail Corporation (DMRC) for the ambitious Rs.5,581-crore elevated mass rapid transit system in Thiruvananthapuram and Kozhikode.

The agreement was signed by S.D. Sharma, Director, Business Development, DMRC, and P.C. Harikesh, Managing Director, KMCL, in the presence of Chief Minister Oommen Chandy, his Cabinet colleagues including Minister for Public Works V.K. Ebrahim Kunju, Union Minister of State for Human Resource Development Shashi Tharoor, Speaker G. Karthikeyan, legislators, Principal Adviser of the DMRC E. Sreedharan, and top officials at the Assembly complex here.

The Chief Minister said the monorail for the two cities were dream projects of his government like that of Kochi Metro Rail and sought the cooperation of all for time-bound completion of the projects. He congratulated Mr. Kunju and Mr. Sreedharan for enabling the project to take off.

Mr. Sreedharan said it was a red-letter day for the DMRC and promised that the latest and the best of frontline technology would be introduced in the two cities.

A single agreement was signed with the DMRC for the projects, as the general consultant and executing agency are the same. The DMRC will get 3.25 per cent of the Rs.5,581 crore as consultancy fee and the mode of payment will be on quarterly basis.

Of the Rs.5,581 crore, Rs.3,590 crore is expected to be incurred for the Thiruvananthapuram project and Rs.1,991 crore for Kozhikode. Mr. Sreedharan said the pre-qualification tenders for the projects would be floated soon.

The agreement will make the DMRC responsible for the design, preparation of bid document, short-listing and selecting contractors, supervision, and quality certification of the 22.2-km monorail in Thiruvananthapuram and the 14.2-km monorail in Kozhikode.

The capital monorail has been mooted from Technocity to Karamana and the Kozhikode monorail with 15 stations starting from the government medical college hostel area to Meenchantha.

KMCL, DMRC ink monorail pact | The Hindu

 

[cloud_9]

Adani Power commissions 3rd unit at Maharashtra plant

Ahmedabad, June 19: Adani Power Ltd, a subsidiary of Adani Enterprises Ltd and part of the Adani Group, on Thursday announced commissioning of the third unit of 660 megawatt (MW) at its super critical technology-based power plant in Tiroda, Maharashtra.

With this, the company’s total generation capacity has risen to 7,260 MW.

Adani Power Maharashtra Ltd, a unit of Adani Power Ltd, is constructing a 3,300 MW (5 X 660 MW) thermal power plant in Tiroda. It has already commissioned the first two units of 660 MW each in 2012-13, achieving its current generation capacity of 1,980 MW.

The third unit was commissioned within a record time of 20 days from synchronisation, as against an industry standard of three months, a company official said.

First unit of 726 MW ONGC Tripura power project inaugurated

The first unit of 726 MW gas-based Tripura power project was today inaugurated by President Pranab Mukherjee. With this inauguration, the Rs. 3,400 crore project, developed by ONGC Tripura Power Corporation Ltd (OTPC) and the biggest ever thermal power project of the region, would start its commercial production.

Power from the project would feed power starved North-Eastern states of Assam, Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland and Tripura. A 400 KV transmission line is under construction to evacuate power from Palatana project and connect to the North-Eastern grid at Bongaigaon in Assam. The transmission line has already been completed up to Byrnihat in Meghalaya. The 400 KV transmission line would pass through three states namely Tripura, Meghalaya and Assam and the total length of the transmission line would be around 650 km.

Installed Capacity - 225,133 MW (1st quarter of 2013)

 

[cloud_9]

Government set to privatize 15 more airports

NEW DELHI: The government has decided to privatize 15 airports. The process will be kicked off by six main airports — Kolkata, Chennai, Ahmedabad, Jaipur, Lucknow and Guwahati — going for international bidding in the first phase. A meeting of an inter-ministerial group on this issue with representatives from planning commission, finance, law and aviation ministries will be held on Thursday.

"These airports will be operated, managed and further developed by the PPP players, in which Airports Authority of India (which built, modernized and operates them) will also have a stake. All employees working at these airports will have to be retained by the new operators as the AAI will not have the capacity to absorb them," said a senior official of the aviation ministry, which is pushing hard for this hasty sell off.

Asked why the government is initiating this process with barely a few months to go for the polls and when airport privatization has proven to be so controversial, the official said: "The process is being started and we hope to put the blueprint in place. Maybe the process is actually taken forward by the next government but we are doing the groundwork. The pace at which this work progresses will decide whether UPA-II is able to do it or the next government," said the official.

The Comptroller and Auditor General had fined several loopholes in the privatization agreement of Delhi Airport and alleged that the state had lost several crores in revenue due to that. The aviation ministry says it has learnt a lot from the experience of privatizing Delhi and Mumbai airports and won't be repeating some 'mistakes' made then.

Now, the tariff for the entire concession period of 30 years (for which the airport will be given to PPP players) will be decided in one go and there will be price adjustment mechanisms to avoid multi-fold price escalation like those witnessed in Delhi and Mumbai. The cost escalation in Delhi has led to levy of such steep user charges that the place is now the most expensive airports for passengers and airlines globally.

So what will become of the AAI now? The government has also decided to hive off air traffic services from it as a separate organization. "AAI will focus on smaller airports. It will get enough as revenue share from the PPP airports," said an official.

AAI sources, on the other hand, are fuming. They say the ministry wants it to pull out of airports that have substantial commercial activities. "Being a government organization, we are not allowed to work at a fast pace. In past four years we have not been able to lease out land for commercial activities at our airports. The higher echelons of the government keep objecting. It seems the government has decided to privatize all commercially viable airports and now only excuses will be made," said sources.

 

[silent poison]

The BSE benchmark Sensex on Monday regained the 20,000 level after six weeks at mid-session on emergence of value buying by funds amid firming Asian trend.

After a lower start at 19,883.19, the Sensex rose by 113.97 points, or 0.57 per cent to 20,072.44 at 1300 hrs. This is the first time the index has crossed the 20,000 mark since closing of 20,215.40 on May 30.

The broad-based National Stock Exchange index Nifty rose by 22 points, or 0.37 per cent, to 6,031.

Brokers said funds indulged in buying fundamentally strong stock available at existing attractive levels besides a firming trend in the Asian region.

They said the sentiment also bolstered after IT major Infosys kicked start the quarter earning season with gains.

The two most-heavy with their 15 per cent weightage on the Sensex - Reliance Industries rose by 0.44 per cent to Rs 893.50 and ITC by 0.56 per cent to Rs 351.75.

Others on the higher side were, ****** Airtel, Dr Reddy's Lab, Hindustan Unilver, Mahindra and Mahindra, Jindal Steel, Sterlite Industries, Tata Consultancy and Wipro.

Sensex regains 20k level after 6-week at mid-session - The Hindu

 

[kak1978]

Aimed at increasing the flow of foreign funds in light of a depreciating rupee against the dollar and in a bid to turnaround the declining investor sentiment, the United Progressive Alliance government on Tuesday announced major changes in the foreign direct investment (FDI) caps, bringing defence, telecom, insurance, commodity exchanges and power exchanges under a more liberalised FDI regime.

In major decisions taken late on Tuesday at a meeting convened by Prime Minister Manmohan Singh to send out a strong message that the country was on the path of reforms agenda, it was decided that 26 per cent FDI cap on defence manufacturing would now be under the automatic route and beyond 26 per cent the Cabinet Committee on Security (CCS) will take a decision on case-to-case basis that are likely to result in access to modern and state-of-the-art technology in the country.

“The CCS will take decisions in the defence sector on case-to-case basis, which entails induction of latest technology into the country. We will approach the Cabinet soon on decisions taken in today’s [Tuesday’s] meeting. Clarity on multi brand retail guidelines will also be issued soon to address the concerns of investors,’’ Commerce and Industry Minister Anand Sharma told reporters here.

The government also hiked the FDI limit in the telecom sector from 74 per cent to 100 per cent.

Addressing concerns, especially of the foreign investors in the insurance sector, the government hiked the 26 per cent FDI limit to 49 per cent under the automatic approval route.

Similarly, for the basic and cellular services in the telecom sector, the government hiked the limit under the automatic route to 49 per cent and 49 to 100 per cent under the Foreign Investment Promotion Board (FIPB) route.

In petroleum and natural gas refining, commodity exchanges, power exchanges, stock exchanges, depositories and Clearing Corporation, the cap has gone up to 49 per cent under the automatic route.

Source: The Hindu

 

[IndoCarib]

Renault-Nissan to Invest $2.5 Billion in India - WSJ.com

 

[Middle Kingdom]

India has been using its forex reserves to prop up the Rupee. The collapse of the Rupee will happen within 12-18 months.

 

[kena]

KMCL, DMRC ink monorail pact

Overcoming several hurdles, Kerala Monorail Corporation Ltd (KMCL) on Wednesday signed the general consultancy agreement with the Delhi Metro Rail Corporation (DMRC) for the ambitious Rs.5,581-crore elevated mass rapid transit system in Thiruvananthapuram and Kozhikode.

The agreement was signed by S.D. Sharma, Director, Business Development, DMRC, and P.C. Harikesh, Managing Director, KMCL, in the presence of Chief Minister Oommen Chandy, his Cabinet colleagues including Minister for Public Works V.K. Ebrahim Kunju, Union Minister of State for Human Resource Development Shashi Tharoor, Speaker G. Karthikeyan, legislators, Principal Adviser of the DMRC E. Sreedharan, and top officials at the Assembly complex here.

The Chief Minister said the monorail for the two cities were dream projects of his government like that of Kochi Metro Rail and sought the cooperation of all for time-bound completion of the projects. He congratulated Mr. Kunju and Mr. Sreedharan for enabling the project to take off.

Mr. Sreedharan said it was a red-letter day for the DMRC and promised that the latest and the best of frontline technology would be introduced in the two cities.

A single agreement was signed with the DMRC for the projects, as the general consultant and executing agency are the same. The DMRC will get 3.25 per cent of the Rs.5,581 crore as consultancy fee and the mode of payment will be on quarterly basis.

Of the Rs.5,581 crore, Rs.3,590 crore is expected to be incurred for the Thiruvananthapuram project and Rs.1,991 crore for Kozhikode. Mr. Sreedharan said the pre-qualification tenders for the projects would be floated soon.

The agreement will make the DMRC responsible for the design, preparation of bid document, short-listing and selecting contractors, supervision, and quality certification of the 22.2-km monorail in Thiruvananthapuram and the 14.2-km monorail in Kozhikode.

The capital monorail has been mooted from Technocity to Karamana and the Kozhikode monorail with 15 stations starting from the government medical college hostel area to Meenchantha.

KMCL, DMRC ink monorail pact | The Hindu

Hmm...not fair...your avatar

 

[Abhishek_]

India's plan to become a leading olive oil producer

In a field in India's western desert state of Rajasthan, row after row of trees covered in lush, green leaves stretch into the distance as the sun beams down from a pale blue sky.

A farm worker kneels down and fights off the wind to grab hold of a thin branch with a few olives on it.

"You see that they are green. Slowly, they will turn red and will be ready to be made into oil in a few months during harvest," he says.

In September, commercial production of olive oil will begin in Rajasthan as part of India's ambitious plan to become a leading international producer to rival countries like Spain, Italy and Greece.

Yogesh Verma from Rajasthan Olive Cultivation Limited, a state government-funded agency spearheading the project, says that since 2008, more than 144,000 olive trees have been planted on almost 260 hectares (642 acres) of government and private land in the state, which, with its long, dry summers and short, cool winters, offers the perfect conditions for growing olives.
Subsided farming

"In 2007, no-one even believed that olives can grow here," Mr Verma said. "But look now."

It is only the beginning, with plans to expand to 5,000 hectares over the next three years.

Farmers, many of whom had never seen or heard of olives before, are coming around to the idea.

To entice them, the Rajasthan government is offering subsidies.

Each olive tree costs 130 rupees ($2.19; £1.40) to plant but farmers pay just 28 rupees. And 90% of the cost of setting up a drip irrigation system, which is expensive to install but uses water more efficiently, is covered.

Sahabram Saharan, 52, for decades grew wheat and cotton, which require a lot of water.

But in April, he planted his first olive trees across 10 hectares at his farm in the village of Madera close to the Pakistan border. In August, he plans to add five more hectares.

"There's a scarcity of water in Rajasthan. There's not enough," he said.

"I know olive trees last for 100 to 150 years. That's why I decided to plant them. I've just started, but in four years, olives will begin to grow. I know people make oil from olives. I will do the same."

There is huge potential to increase the area under cultivation in Rajasthan, which is two-and-a-half times larger than Greece, the world's third largest producer of olives.

A sophisticated refinery using machinery from Italy will soon be ready to press olive oil in Rajasthan, and the plan is to tap into the rising demand in the domestic market.

Data published in April from the Madrid-based International Olive Council showed imports of olive oil, largely from Spain and Italy, climbed by 48% between October 2012 and February 2013 compared to the same period a year earlier.
Growing awareness

A growing number of Indians are becoming aware of the supposed health benefits of olive oil, which has been shown to lower high blood pressure and reduce the risk of heart disease, stroke and certain cancers.

"When I came here for the first time, I could not find a single bottle of olive oil. I found it only in pharmacies, small bottles for the skin. Now you find it everywhere," said Gideon Peleg, an Israeli agriculture expert who has been working with Rajasthan Olive Cultivation Limited.

Around 25 tonnes of olive oil will be pressed this year from September, according to Mr Verma, and he believes it could be available in Indian stores as early as next year.

A litre of imported extra virgin, the highest quality of olive oil, costs 750 rupees (£8; $12) at a New Delhi supermarket. The hope is with domestic production, prices will fall so that more Indians can enjoy the product.

The next challenge will be marketing Rajasthani olive oil, which Mr Peleg describes as a "weak point".

Spain, the world's biggest producer which last year accounted for around 50% of total production worldwide, has spent millions of dollars to promote its olive oil domestically and internationally.

For India to fulfil its global ambitions, it will have to do the same.

"Any consumer good requires a marketing programme and a sales network," said VN Dalmia, president of the Indian Olive Association and owner of the Leonardo Olive Oil brand in India.

"Olive oil from Rajasthan will need to overcome a low quality perception."

BBC News - India's plan to become a leading olive oil producer

 

[agamdilawari]

TCS Q1 profit up 15.5%, beats estimates


MUMBAI: The country's largest software exporter Tata Consultancy Services reported consolidated net profit of Rs 3,831 crore for the June quarter, up 15.5 per cent from Rs 3,318 crore in the same period last year.

The company's total revenue, under Indian IFRS accounting standards, rose 21 per cent to Rs 17,987 crore from Rs 14,869 crore in the corresponding period last fiscal.

The company, in a regulatory filing, said operating margin stood at 26.9 per cent while volume grew 6.10 per cent during the reporting quarter.

Commenting on the performance, managing director and chief executive N Chandrasekaran said, "We have delivered another solid quarter, driven by the highest volume growth in the past seven quarters. It has been an all-round performance with strong revenue growth across markets led by the US.

"Our investments in Europe continue to gain strong traction with customers and helped us deliver industry-leading growth this quarter."

He further said the company added two $100 million plus clients during the reporting period.

The company's gross employee addition was 10,611, while the overall employee utilization rates stood at 82.7 per cent and the attrition rate for IT arm stood at 9.55 per cent, which at the BPO arm was higher 15.77 per cent.

Chief financial officer Rajesh Gopinathan said, "the current environment demands an agile operating model that can capture diverse growth opportunities. We continue to execute to plan and invest for growth, while maintaining stability in our margin profile."

TCS Q1 profit up 15.5%, beats estimates - The Times of India

 

[Assault Rifle]

India 'will become world's biggest economy in less than 40 years'

India will overtake China to become the world’s biggest economy in less than 40 years, according to leading economist Douglas McWilliams, chief executive of the Centre for Economics and Business Research think-tank.

Schoolchildren take part in the Independence Day celebrations in front of the historic Red Fort, where Indian Prime Minister Singh is to address the nation in Delhi
After China becomes the world’s largest economy around 2023, it will itself be overtaken by India around 2048

By Emma Rowley
4:12PM BST 16 Jul 2013


China is widely acknowledged to be on track to oust the US from that position within the next decade, although expectations vary on when exactly the handover will take place.
But after China becomes the world’s largest economy around 2023, it will itself be overtaken by India around 2048, predicts Mr McWilliams.
“We are only part way through a major process that is set to continue for the next 50 years at least,” he said.

The consequences of this Asian industrialisation present a major challenge to Western economies, even threatening the UK with the risk of becoming a next Greece, Mr McWilliams said on Thursday evening in his inaugural lecture as the Mercers’ School Memorial Gresham Professor of Commerce.
The danger arises because the pace of change in the rapidly growing East has been so fast that its citizens have not yet become used to prosperity, he argued.

“They behave with the hunger of societies that are poor even though they are becoming [and in some cases like Hong Kong and Singapore have already become] rich,” he said. “They don’t take prosperity for granted.”
According to his figures, the average Singaporean works 2,307 hours a year and the average Hong Konger works 2,287 hours. In contrast, the British average is 1,625 hours, while our tax rates are also higher.
Yet in Singapore, gross domestic product (GDP) per capita is already 30pc higher than in the UK. In Hong Kong it is 50pc, said Mr McWilliams.
If Western economies do not adjust their policies to match those of the competitive economies in the East, he said “there is a risk that the rest of Europe, including even countries outside the single currency like the UK, could slide in the same way that Greece now has into first stagnation and then economic collapse”


Source: Telegraph.co.uk