Indian Economy News & Discussion - Nov 27 2017

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JTull
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Re: Indian Economy News & Discussion - Nov 27 2017

Postby JTull » 29 Oct 2020 18:23

Anoop.G wrote:
nam wrote:Confirmation from the TamilNadu CM himself.

https://twitter.com/CMOTamilNadu/status/1321479512165552128


This has been confirmed to me by last night the Tata's CEO designate of this venture. He is a batchmate of mine and an old Tata employee. The formal appointment is yet to be made.


It is unfair to quote insiders so pointedly esp. when they've shared info in confidence.

Mods, please delete both these posts.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby AshishA » 29 Oct 2020 20:34

PM Modi's interview with ET on a wide range of subjects, including India’s reform trajectory, furthering economic growth and the opportunities ahead in a post-COVID era.

https://economictimes.indiatimes.com/ne ... 922895.cms

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Vamsee » 29 Oct 2020 20:47

So many important topics touched in below interview. Please read the whole thing.

New India believes in market forces, will be the most preferred investment destination: PM Modi

You seem to believe that India can still emerge as a major world hub for manufacturing, especially by becoming part of global supply chains at a time when companies are looking to de-risk their exposure to China. What is the progress in this regard? Can India emerge as a credible alternative to China in global supply chains?

India has not started speaking about manufacturing only after the pandemic. We have been working on increasing
manufacturing for sometime now. India is, after all, a young country with a skilled workforce. But India doesn’t believe in
gaining from the loss of others. India will become a global manufacturing hub on its own strengths. Our effort is not to
become some country’s alternative, but to become a country which offers unique opportunities. We want to see the
progress of all. If India progresses, 1/6th of humanity will progress.
We saw how a new world order was formed after World War II. Something similar will happen post Covid-19. This time,
India will ride the bus of manufacturing and integrating in global supply chains.
We have specific advantages in the form
of democracy, demography and demand.


So, what are the policy measures you propose to enable India take this giantleap?

India’s pharma sector, during the past few months, has already demonstrated the way ahead. India has emerged as a key
player in global pharma supply chains. We have become the second largest manufacturer of PPE kits in a very short
duration. India is also making a mark in manufacturing technologically advanced items like ventilators and from almost
negligible capacity earlier, we are now manufacturing thousands of ventilators in quick time.
From independence till the pandemic started, around 15-16 thousand ventilators in working condition existed in
government hospitals across India. Now, we are moving rapidly towards adding another 50000 ventilators these
hospitals.
Now, that we have successfully established this model. We can emulate it in other fields. Our recently launched
production-linked incentive (PLI) schemes for mobile manufacturing, pharmaceutical and medical devices are good
examples of this focused and targeted approach to attract internationally reputed investors to create capacities with
global scales and competitiveness, as well as make India their export hub. In the mobile phone segment alone, it’s
expected that production worth over 10 lakh crore will take place over the next five years, of which 60% will be exports.
According to Moody’s, 154 greenfield projects from the US have come to India in
2020, compared to 86 in China, 12 in Vietnam and 15 in Malaysia.
This is a clear
indication of global confidence in India’s growth story going forward. We have
laid strong foundations to make India the foremost manufacturing destination.
The corporate tax cut, introduction of commercial mining in coal sector, opening
up of space sector for private investment, lifting defence restrictions on air routes
for civil aviation use, are some steps that will go a long way in boosting growth.
But what we should also understand is that India can grow only as fast as our
states do. There needs to be healthy competition among the states in attracting
investment. States are also competing on the Ease of Doing Business rankings.
Incentives alone may not be enough to bag investments, states will need to build
infrastructure and follow good development-related policies.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Vamsee » 29 Oct 2020 20:53

Some more points


There is fear in some quarters that the Atmanirbhar initiative marks a return to the days of autarky. Some say
there is a contradiction between India seeking to become part of global supply chains while restricting imports.
Your views?


It’s not in the nature of India or Indians to be inward looking or self-centered. We are a forward-looking civilization and a
vibrant democracy that looks to interact with other countries to build a better world. Aatmanirbhar Bharat is not just
about competition but also about competence, it’s not about dominance but about dependability, it’s not about looking
within but about looking out for the world.
So, when we say Aatmanirbhar Bharat, we mean an India that is, first of all, self reliant. A self-reliant India is also a reliable friend for the world. A self-reliant
India does not mean an India that is self-centered. When a child reaches the age
of 18, even the parents tell him or her to become Aatmanirbhar. This is natural.
Today we are using our aatmanirbharta to help the world in the medical field. For
instance, we are producing vaccines and drugs without increasing costs or
putting restrictions. A relatively poor country like ours incurs a huge cost to
educate doctors, who are today spread across the globe, helping humanity. We
never stopped them from migrating.
When India becomes Aatmanirbhar in a certain field, it always helps the world.
If someone doesn’t understand the ethos and spirit of India, they won’t
understand this concept.

So, there’s no contradiction?
Confusion among experts is not necessarily a contradiction in our approach. We
have just eased restrictions for FDI through reforms like you see in agriculture,
labour and coal. Only a country that believes in the power of international trade
and commerce would go on opening up more and more avenues to work with the
world. At the same time, it’s also true that India has been unable to realise its
potential in sectors where it has inherent comparative advantages. Take coal for
instance. India imported nearly 1.5 lakh crore worth of coal in 2019-20, despite
having one of the biggest reserves in the world
. Defence is another area of import
dependence for us.
While we have increased the FDI limit from 49 to 74%, domestic production for 101 items worth 3.5
lakh crore over the next ve years has also been announced.
We have given a fair chance to those who have invested in India, shown their trust to expand their capacities and become
globally competitive. The Aatmanirbhar Bharat initiative is about unlocking India’s latent potential, so that our firms can
serve not just domestic markets, but also global ones.

It appears from government assessments that FTAs have not worked in India’s favour. We also walked out of RCEP.
How has your thinking evolved on subject? Do you think we should pursue FTAs at all?


The guiding principle behind International trade is to create win-win solutions for all countries involved. And I am told
by experts, that ideally trade deals should be global and multilateral through the WTO. India has always adhered to
global trade rules and stood for a free, fair, equitable, transparent and rules-based international trading system, which
should full the intended developmental objectives and aspirations of developing countries, as envisaged under the
WTO.
In the past, while opening our markets, we also signed 10 free trade agreements (FTAs) and 6 preferential trade
agreements (PTAs). The assessment of existing FTAs should happen on the metric of how they have benefited for India
and not on the basis of ideological standing.
India is keen to be part of global value chains and wants to do trade deals but they have to be fair and non-discriminatory.
Moreover, since India would be providing access to a large market, the agreements must be reciprocal and balanced.
We gave preferential access to our large market under our FTAs. However, our
trading partners have not always reciprocated with the same treatment. Our
exporters have often faced ill-intended non-tariff barriers. For example, while our
trading partners can export steel to India, few trading partners don’t allow the
import of Indian steel.
Similarly, Indian tire manufacturers are unable to export
due to technical barriers. While India remains committed to openness and
transparency in trade, it will use the measures and instruments at its disposal in
ensuring free and fair access for its exporters.
In the case of RCEP, India made its best efforts for a final conclusion. We wanted
a level playing field based on fair trade practices and transparency. We expressed
serious concerns over non-tariff barriers and opaqueness of subsidy regimes in
some RCEP countries. India took a considered position not to join RCEP,
highlighting the fact that the current structure did not reflect RCEP guiding
principles nor address outstanding issues.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Uttam » 29 Oct 2020 21:01

From the WSJ.

As Covid-19 Closes American Classrooms, Families Turn to India for Homework Help


Demand for online study support is fueling business for Indian teachers, who are tutoring American children on everything from calculus to computer programming. They are helping U.S. high-school students get through their homework and college students better understand their economics and engineering reading.




“One of the massive benefits of the Indian economy is the education system,” said Erik Manuevo, vice president of content and operations at Chegg. “In subjects that are often challenging, the Indian education system is better equipped to train individuals to become experts.”


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Re: Indian Economy News & Discussion - Nov 27 2017

Postby vijayk » 30 Oct 2020 20:10

https://swarajyamag.com/economy/stimulu ... own-impact

Stimulus Package: The Benefits Are There To See, And Those Who Say Otherwise Are Ignoring Lockdown Impact

Image

There is no doubt that the first round of the stimulus has had a positive impact on the economy and anyone who says otherwise is perhaps ignoring the stringency of the lockdown and its implications for companies that saw a severe cash-flow problem which could have forced them towards bankruptcies.

The focus, now, however, is on the growth recovery process as we attempt to address the key challenge of restoring economic activity to the pre-Covid-19 levels as quickly as possible.

It would be worthwhile to remember that this will remain a challenge till the pandemic is contained with the availability of a vaccine.

Nonetheless, a bulk of the policy support extended on the supply side would require now for demand to be back into the system to help restore the balance sheet of private companies.

The government has thus far decided to bank on government employees to drive the final consumption in its second stimulus and we will have to wait to see its impact over the coming few quarters.

However, the issue of providing support to the economy is far from over as government and the Reserve Bank of India will have to continue with the policy support well into the next financial year.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby vijayk » 30 Oct 2020 20:22

https://swarajyamag.com/economy/exports ... o-continue
Exports Have Bounced Back Sharply After The Covid-19 Lockdown; India Needs The Momentum To Continue

Exports earnings form a key high frequency economic indicator. September 2020 was the first month of goods export rise after a six month falling streak. Exports registered almost 6 per cent year on year growth over September 2019 and hit the $27.58 billion mark.

In a Covid-19 pandemic-marred year, this is a good sign. Indian exports have recovered much faster than imports, indicating an operational resilience in a very tough year. Not only did the lockdowns created day to day hassles for manufacturers, the global demand itself has been under pressure with all major buying centres for Indian goods witnessing their own economic slowdown.

In fact in June this year, India recorded its first-ever trade surplus since January 2002. That was the era when India did not depend much on Chinese imports and was taking small steps in capturing some of the merchandise markets. But it was all downhill since then, until the pandemic-led dynamics produced a $790 million trade surplus this year.


Exports earnings form a key high frequency economic indicator. September 2020 was the first month of goods export rise after a six month falling streak. Exports registered almost 6 per cent year on year growth over September 2019 and hit the $27.58 billion mark.

In a Covid-19 pandemic-marred year, this is a good sign. Indian exports have recovered much faster than imports, indicating an operational resilience in a very tough year. Not only did the lockdowns created day to day hassles for manufacturers, the global demand itself has been under pressure with all major buying centres for Indian goods witnessing their own economic slowdown.

In fact in June this year, India recorded its first-ever trade surplus since January 2002. That was the era when India did not depend much on Chinese imports and was taking small steps in capturing some of the merchandise markets. But it was all downhill since then, until the pandemic-led dynamics produced a $790 million trade surplus this year.


These industries are also labour intensive, which adds to the job market normalisation. As several of Indian export destinations are witnessing a second wave of the Covid-19 pandemic, the uncertainty may continue for some more time.

With the government looking to capitalise on the global trade momentum away from China, next few months will be crucial for Indian exports. Not only this year’s trade picture needs to improve, but there’s also a directional one-time opportunity to tap.

Nonetheless, despite all the issues and disruptions across the supply chain, it is heartening to see the Indian exporters getting their act together in the last couple of months. The export increase to the US and the trade deficit narrowing with China is good news. Sustaining this over the full year will be key to building on the idea of Aatmanirbhar Bharat.



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Re: Indian Economy News & Discussion - Nov 27 2017

Postby DavidD » 31 Oct 2020 02:19

Mollick.R wrote:Tightening the screws on Chini guys.........
This also begs same repeatedly asked questions.......
Why it took so Long ? & Why it was being ignored in first place to begin with ??

India issues quality control order for some leather goods to restrict cheap imports
By Kirtika Suneja, ET Bureau Last Updated: Oct 29, 2020, 01:33 PM IST

NEW DELHI: India on Thursday notified a quality control order on leather footwear and products in a move that will restrict their cheap imports into the country the central government, after consulting the Bureau of Indian Standards (BIS), is of the opinion that it is “necessary or expedient so to do in the public interest”.

The Department for Promotion of Industry and Internal Trade (DPIIT) mandated the BIS with the certification of ten such products including leather safety boots and shoes, canvas boots rubber sole, sports footwear and antiriot shoes in the Footwear made from Leather and other materials (Quality Control) Order, 2020. India imported leather articles worth $ 453.12 million in FY20 of which $318.45 million came from China.
.
.
The order follows the Toys (Quality Control) Order that requires all toys and material for children below 14 years to be certified by the BIS which is India’s national standards body.

The department had in January issued quality norms to control imports of steel tubes, tubulars and other wrought steel fittings, steel tubes for structural purposes and water wells, along with heavy duty electric cables, aerial bunched cables, elastomer insulated cables, welding cables, shot firing cables and halogen-free, flame retardant cables.

Toys, furniture, sports goods and glass items are some of the products in a list of about 370 for which technical standards have been in the works since late last year and seek to reduce dependence on imports and improve domestic manufacturing.



Read Full Article Here//ET Link
https://economictimes.indiatimes.com/news/economy/foreign-trade/india-notifies-quality-control-order-for-some-leather-goods-to-restrict-cheap-imports/articleshow/78927981.cms?utm_source=ETTopNews&utm_medium=HP&utm_campaign=TN&utm_content=23


What took so long? Perhaps some thought that it's not a good idea to antagonize the world's 2nd largest economy while you're trying to develop? Imagine if China for the past 40 years decided to curb Japanese investment and imports due to territorial disputes, or rejected Taiwan for the paused Civil War. You can't do everything at once. If your priority is economic growth, which priority are you willing to sacrifice to accomplish it?

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Suraj » 31 Oct 2020 09:15

So far in the current fiscal year:

Foreign portfolio investment: $8.5 billion net
FDI (April-Aug): $25 billion
Foreign exchange reserves: increased from $475 billion to $560 billion (+$85 billion)

Trade (April-Sept):
Merchandise exports: $126 billion (-21%)
Merchandise imports: $148 billion ( -40%)
Services exports: $81 billion (-9%)
Services imports: $46 billion (-19%)
Total exports: $207 billion
Total imports: $194 billion
Balance: +$13 billion
Last edited by Suraj on 01 Nov 2020 00:04, edited 1 time in total.
Reason: Added: Updated services data

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Ambar » 31 Oct 2020 18:58

A bit surprised at the negative services and merchandise exports, i would think its mostly because of supply chain disruption than lack of demand. One of the strange byproduct of this pandemic and it bringing the entire world economy to a screeching halt is that a lot of people have more flexibility to spend towards discretionary spending. This is mainly because people are not commuting, travelling, eating out much, going to movies/restaurant etc. and that money is going towards buying electronics, clothes, shoes, furniture etc. Secondly, i'd assume a large component of India's services exports are IT services. With visas getting harder to come by and more and more companies in the west consolidating or increasing capital spending towards automation, Indian IT should see a robust growth in the coming quarters. All in all, i wouldn't be too surprised to see an impressive bounce back in the exports sector in Q4.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby vijayk » 31 Oct 2020 21:15



very good overview

Image

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FULL REPORT

https://www.mckinsey.com/featured-insig ... h-and-jobs
India is at a decisive point in its journey toward prosperity. The economic crisis sparked by COVID-19 could spur reforms that return the economy to a high-growth track and create gainful jobs for 90 million workers to 2030; letting go of this opportunity could risk a decade of economic stagnation. A new report from the McKinsey Global Institute identifies a reform agenda that could be implemented in the next 12 to 18 months. It aims to raise productivity and incomes for workers, small and midsize firms, and large businesses, keeping India in the ranks of the world’s outperforming emerging economies.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Suraj » 01 Nov 2020 00:07

I've updated the services data in the previous post. It appears PIB data does not reflect September services data, so Financial Express (where I got the figures from) also miscomputed, comparing April-August 2020 data against April-September 2019 data from PIB. I've redone the numbers for just April-August . It's not bad at all - less that 10% drop in services exports. Probably by year end it will be nearly on par with prior full year number.

For the full year 2019-20, the services exports were an all time high of $215 billion, and imports were $132 billion. This is a monthly export of just under $18 billion, which we're almost back to the level of.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Dilbu » 01 Nov 2020 17:30


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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Dilbu » 01 Nov 2020 17:45

India's economy worst-hit among emerging markets
Chennai: Among the emerging nations, India seems to be the worst affected by the Covid-19 pandemic as the strength of the economy has deteriorated the most in India in the first half of 2020, finds a study.

The Investors’ Macro Ratings Index, which looks at investors’ perception of the economy based on parameters like real GDP growth, inflation, fiscal deficit and bank credit, has deteriorated in all the emerging economies, as per a report by Motilal Oswal Financial Services. However, India was the most affected in the first half and Taiwan was the least affected. The study examined macro-economic parameters in emerging economies like India, Brazil, China, Indonesia, South Korea, Malaysia, Russia, South Africa, Taiwan and Thailand.

As per IMF’s projection, India’s real GDP growth is expected to contract 10.3 per cent in 2020, which is the highest contraction among the 10 emerging markets. India is also the only economy with a double-digit contraction. On the other hand, China is expected to see 1.9 per cent growth, the highest among all of them.

At 4.9 per cent retail inflation in 2020 will be the highest in India. Inflation has eased in most of the emerging economies, except India. Average inflation during the nine-month period of 2020 has more-than-doubled in India, while in most of the emerging nations it was lower than the same period in 2019.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby nam » 01 Nov 2020 19:04

Suraj wrote:So far in the current fiscal year:

Foreign portfolio investment: $8.5 billion net
FDI (April-Aug): $25 billion
Foreign exchange reserves: increased from $475 billion to $560 billion (+$85 billion)

Trade (April-Sept):
Merchandise exports: $126 billion (-21%)
Merchandise imports: $148 billion ( -40%)


Interesting numbers. I would assume some of the imports go towards creating export products, however given the value add, the cost of that imports will be way lower than exports.

So looks like most of the import fall are items consumed within the country. Oil & Gold would probably be a major part. We seem to be doing fine without those remaining imports. Good reason to produce it here and reduce the import.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby nam » 01 Nov 2020 19:16

DavidD wrote:What took so long? Perhaps some thought that it's not a good idea to antagonize the world's 2nd largest economy while you're trying to develop? Imagine if China for the past 40 years decided to curb Japanese investment and imports due to territorial disputes, or rejected Taiwan for the paused Civil War. You can't do everything at once. If your priority is economic growth, which priority are you willing to sacrifice to accomplish it?


Two issues with that comparison. The investment by Chinese companies is no where comparable to the level of technology investment provided by Japan & Taiwan. Basically Chinese FDI (in cash or material) doesn't move India's needle. The biggest "technology" investment is cheap mobile phone assembly plant.

Second, when was the last time Taiwanese or Japanese troops intruded in to China and killed 20 PLA troops?

It is not as if India companies cannot produce majority of the goods imported from China. It is done because it is cheaper, helped by heavy subsidies from CCP to undercut competition.

US & India together make up 95% of Chinese trade surplus! If CCP doesn't like to behave, they can watch the surplus disappear.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Suraj » 01 Nov 2020 23:01

Please avoid bringing up geopolitics and related whataboutery here.


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Re: Indian Economy News & Discussion - Nov 27 2017

Postby DavidD » 02 Nov 2020 00:27

nam wrote:
DavidD wrote:What took so long? Perhaps some thought that it's not a good idea to antagonize the world's 2nd largest economy while you're trying to develop? Imagine if China for the past 40 years decided to curb Japanese investment and imports due to territorial disputes, or rejected Taiwan for the paused Civil War. You can't do everything at once. If your priority is economic growth, which priority are you willing to sacrifice to accomplish it?


Two issues with that comparison. The investment by Chinese companies is no where comparable to the level of technology investment provided by Japan & Taiwan. Basically Chinese FDI (in cash or material) doesn't move India's needle. The biggest "technology" investment is cheap mobile phone assembly plant.

Second, when was the last time Taiwanese or Japanese troops intruded in to China and killed 20 PLA troops?

It is not as if India companies cannot produce majority of the goods imported from China. It is done because it is cheaper, helped by heavy subsidies from CCP to undercut competition.

US & India together make up 95% of Chinese trade surplus! If CCP doesn't like to behave, they can watch the surplus disappear.


Adhering to the warning, I'll avoid geopolitics and reply to the economics part. I'm pretty sure Japanese investments in China in the beginning were manufacturing of very cheap stuff, and smartphones are pretty appropriate IMO relative to the technological level of Chinese manufacturers right now. The Japanese/Koreans etc. aren't exactly strangers to subsidies either.

As for the trade deficit, it doesn't really work that way. If the US/India buys less from China, it'll buy more from the rest of the world. If China sells less to the US/India, it'll sell more to the rest of the world. Look at the balance of trade data from the US and China after the massive tariffs imposed on each other. The needle didn't move a bit from 2018 to the beginning of 2020 when COVID struck. Bilateral trade suffered, sure, but the overall balance of trade for each country remained the same. After RCEP is signed in a couple of weeks, this will be even more so the case.

https://tradingeconomics.com/united-sta ... e-of-trade

https://tradingeconomics.com/china/balance-of-trade

Going forward, China is transitioning into an internal consumption driven economy. While currently, that's Xi's directive, but actually the trend has been going on for 10 years now.

<iframe src="https://data.worldbank.org/share/widget?indicators=NE.TRD.GNFS.ZS&locations=CN&start=2009" width='450' height='300' frameBorder='0' scrolling="no" ></iframe>

Balance of trade is more a reflection of the internal economic structure of a country, focusing on trade and not the structure is IMO treating the symptom and not the disease.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby sudarshan » 02 Nov 2020 01:46

DavidD wrote:Adhering to the warning, I'll avoid geopolitics and reply to the economics part....


Adhering to what warning? This isn't a general economics thread, if it goes away from the topic of "Indian economy," Suraj is still going to wield the thunderbolt.

I'll say this much though - your question was "what priority are you (presumably, India) willing to sacrifice for economy?" So the Chinese view is still that India should be willing to sacrifice territory for economy?

Better off in some other thread, if you want to discuss these territory sacrifices which are expected of India (for economy's sake).

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Rishirishi » 02 Nov 2020 05:48



India stands "nowhere".

Indias strategy has been to be a "late adapter", not being a market leader. This means India waits for the industry to mature and prices drop. The plus side is you get more bang for your buck. The downside is your companies do not get to be global players and end up purchasing a lot of technology in stead of inventing it (making making money on innovation).

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby KL Dubey » 02 Nov 2020 11:03

^^Let's not get too excited about some random news article. There is no $700 bn new business on the horizon here. Most of the claims in the article are BS.

A water electrolyzer is no super duper technology. Its just a very expensive way to make hydrogen. There is very little innovation here if any. Just because some Chinese company is making them doesn't mean we should jump in too.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Uttam » 02 Nov 2020 19:40

KL Dubey wrote:^^Let's not get too excited about some random news article. There is no $700 bn new business on the horizon here. Most of the claims in the article are BS.

A water electrolyzer is no super duper technology. Its just a very expensive way to make hydrogen. There is very little innovation here if any. Just because some Chinese company is making them doesn't mean we should jump in too.


That's exactly what I used to think about electrolyzer tech. But there seems to be some movement in this direction.

SECI to seek bids for green hydrogen units

I am not sure how credible this source is!

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Dilbu » 02 Nov 2020 19:56

India Manufacturing PMI Climbs To The Highest In Over A Decade
A gauge of activity across India’s manufacturing sector jumped to the highest in more than a decade as sales continued to surge. The IHS Markit India Manufacturing Purchasing Managers’ Index rose to 58.9 in October 2020—the highest since mid-2008—from 56.8 in September. A reading over 50 indicates economic expansion. New orders and output at Indian manufacturers continued to recover from the Covid-19-induced contractions seen earlier in the year, with PMI results for October highlighting historically sharp monthly rates of expansion, said Pollyanna De Lima, economics associate director at IHS Markit.

The ongoing relaxation of Covid-19 restrictions, better market conditions and improved demand helped manufacturers secure new work in October. In response to strong sales gains and softer containment measures, firms lifted production at the strongest pace recorded since late-2007, according to the release. Consequently, quantities of purchases rose at the quickest pace in just under nine years. Export orders also picked up, recording a rise most pronounced in close to six years.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Suraj » 02 Nov 2020 20:49

Clearly, the Hindu festival season has done wonders to revive the animal spirits of the economy after the summer lockdown.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby vijayk » 02 Nov 2020 20:56

Suraj wrote:Clearly, the Hindu festival season has done wonders to revive the animal spirits of the economy after the summer lockdown.


Indeed

https://twitter.com/ANI/status/1323134438792814592
ANI
@ANI
UPI crossed 2-billion transaction mark in Oct 2020. UPI volume has grown 80% from 1.14 billion transactions in Oct 2019 to 2.07 billion transactions last month. Transaction value jumped 101% from Rs 1,91,359.94 crores to Rs 3,86,106.74 crores:Amitabh Kant,NITI Aayog CEO


https://www.businesstoday.in/current/ec ... 17602.html
After surge in GST collections, record e-way bills in September mark strong economic revival

https://www.moneycontrol.com/news/busin ... 13241.html
India's exports snap six-month losing streak, rise 5.27% in September
Goyal said this is an indicator of the "rapid recovery" of the Indian economy as it surpasses pre-COVID-19 levels across parameters.

https://energy.economictimes.indiatimes ... l/78050996
Peak power demand back to normal, surpasses last year level
Peak power demand met is the highest energy supply during the day across the country. The government had imposed the lockdown from March 25 to fight the deadly coronavirus in the country

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https://timesofindia.indiatimes.com/bus ... 441572.cms
The freight loading by the railways increased by 15.3% in Setember this year compared to the corresponding period last year

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Dilbu » 02 Nov 2020 21:44

Government Working On Another Stimulus Package, Top Official Hints
New Delhi: Finance secretary Ajay Bhushan Pandey on Sunday hinted that the government is working on another stimulus package but he refrained from giving a timeframe.

"We keep monitoring the situation on the ground to assess which sector of the economy or segment of the population needs what kind of help at which time and respond accordingly. We keep taking suggestions from industry bodies, trade associations, various ministries and after going through their suggestions and requirements of the economy, we come out with timely measures," Ajay Bhushan Pandey said in an exclusive interview to news agency ANI.

Mr Pandey added that the government was working on the stimulus package and deliberations on further interventions were on.
The October GST collection has been ₹ 105,155 crore which is 10 per cent higher year-on-year for the corresponding month last year. This September, the economy had also shown 4 per cent growth at ₹ 95,480 crore in GST collections year-on-year. Further, the country has seen a growth in electricity consumption, exports, and imports, he said.

"September and October data shows that we have reached Pre-COVID-19 level and gone into positive territory. If we compare with the last year, the E-Way bill in September has seen year on year growth of 10 per cent and in October it has seen a growth of 21 per cent," he said.

"If we are able to maintain this growth for the next five months, then we can say that we can transition from deep negative zone to near-zero growth zone by March 2021. International Monetary Fund (IMF) has projected India''s GDP to contract 10.3 per cent this fiscal year, revised from its forecast of a 4.5 per cent decline in June," he added.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Dilbu » 02 Nov 2020 21:46

India's strategy of dealing with COVID-19 paid off, economy set to bounce back: Ficci
"The dilemma for governments across the world was creating a balance between protecting lives and livelihoods. India took the path of a strict lockdown to ramp up health infrastructure and focused on human lives. This strategy has paid off," Reddy said.

She observed that science evolved to give better cures, medical infrastructure was created, supplies like PPEs ramped up and our death rate has been contained.

"It's clearly time for bold actions on the livelihood front. The recent monetary policy assures that the government and the regulator will do everything it takes to keep the economy afloat. Let us start pushing our growth agenda vigorously," said Reddy.

"As we can see the initial green shoots of recovery have begun," she added.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Dilbu » 02 Nov 2020 22:03

An Expert Explains: The road to economic recovery
Active cases are coming down despite normalisation of economic activities. A vaccine breakthrough seems to be on the horizon. Lower oil, gold and Chinese goods imports have made India current account-surplus. Foreign exchange reserves are about to exceed foreign exchange debt. Global firms are opening up their purses for direct as well as portfolio investment. Agriculture reforms will materially benefit a large rural population. Labour reforms and postal life insurance schemes are steps in the right direction for India becoming a manufacturing hub, although a lot more needs to be done on the ground.

The September 20 quarterly results are by and large ahead of street expectations. Margins have expanded across sectors due to deep cost cuts. In sectors like auto and consumer durables, volumes are ahead of expectations. Many attribute it to pent-up demand. Demand, pent up or otherwise, has recovered due to steps taken in the past. However, it needs to be sustained in the future by further measures.

The monetary policy is accommodative but credit transmission needs to improve further. Policy rates are at lifetime low levels but the cost of borrowing needs to be lowered for below-AA rated borrowers. Fiscal stimulus has supported growth at the bottom of the pyramid but sectors like travel, tourism, hotel, retailing, aviation, infrastructure etc require more support. The path of fiscal prudence is important but it needs to be achieved by raising non-tax resources like proceeds from strategic divestment and monetisation of assets, unlocking capital stuck in gold lying in tijori etc.

Ease of doing business has improved but rule of law needs to be improved. Despite good intentions, commercial disputes are getting addressed like the never-ending trial of the 1992 security scam rather than the quick, everyone-wins solution of Satyam. Our laws are being made for the lowest common denominator as crooks escape without adequate punishment. This increases the cost of compliance for the rest. Investment cannot pick up sustainably unless rule of law is experienced by investors. Big has become bigger in these challenging times, but eventually small and medium firms need to become competitive and prosper.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby vijayk » 02 Nov 2020 22:56

https://twitter.com/iMac_too/status/1323289614845538306

iMac_too
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Just watch it for Rajiv Bajaj :rotfl:

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Ambar » 02 Nov 2020 23:12

I think motormouth Bajaj is referring to the retail numbers which is a lagging indicator (and hard to find). As per the latest reports, Bajaj auto delivered a record high number of vehicles in October, so not sure what his problem is other than taking the usual potshots at Modi/BJP govt.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby hanumadu » 03 Nov 2020 00:41

ICICI Bank's profit has risen nearly 5.5 times because it no longer has to provision for bad loans.
SBI still provisioning most of its profit. There is no light at the end of the tunnel, it seems for Indian banks yet.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Suraj » 03 Nov 2020 11:53

Karan Bhasin on Swarajyamag:
Data indicates economic recovery faster than anticipated
The original assessment was that there will be three stages of economic activity — the first will be the lockdown stage where economic activity is restricted, the second will be the normalisation stage where growth moves closer to the pre-Covid levels and the third is the growth revival process, where economic activity turns green and gradually begins to move towards the norm of 6-7 per cent.

Second quarter (Q2) was the normalisation stage — and this was already highlighted using several high-frequency indicators in an earlier article that can be accessed here.

The second quarter indeed saw improvement in several high-frequency indicators as economic activity started to normalise albeit at a slow pace.

The interesting fact, however, pertains to the surprise results of a few private sector banks — namely HDFC and ICICI Bank.

Ira Duggal of Bloomberg Quint made an important observation based on the company’s quarterly performance as she highlighted the strong growth in the home mortgage products offered by the banks.

This is an important sign as India’s residential real estate sector has faced its own sets of challenges over the last few years. The increased demand for home loans is, therefore, important to ensure our economy can fire on all its engines.

Lower interest rates along with price correction can be two potential reasons that are driving the decision for people to purchase residential real estate.

However, an equally important reason could be the pandemic — and forced savings as an outcome of the lockdown which could be finding a way to be invested into residential real estate.

But the goods and services tax (GST) collections in the month of October for the month of September further indicated an impressive growth even as contact services remained muted.

Sectors such as tourism, civil aviation and hospitality continue to operate at substantially lower capacity than pre-Covid times. Despite this constraint, a healthy increase in GST collections indicates an accelerated economic recovery in the non-contact services sector.

For the first time this year, the GST collections crossed the Rs 1 lakh crore figure in October and were nearly Rs 10,000 crore more during the same period in 2019. This is consistent with the estimates contained in the joint paper cited earlier.

Add to this, the recently-released Manufacturing PMI, which was 58.9 vs 56.8 in the previous month marking the strongest improvement in over a decade. The level of fresh orders and output both continue to recover indicating a healthy restoration of the corporate sector balance-sheet.

More importantly, the growth was led by the intermediate goods category, which indicates strong backward and forward linkages. Along with this, consumer and investment goods sub-sectors also saw a robust growth combined with a strong growth of new export orders.

Bullet points:
* Three stage process - lockdown, normalization, return to growth. We are now only entering stage 3
* Forced savings during lockdown are now buoying consumer demand.
* Combination of low interest rates and savings driving real estate sales
* Broadbased industrial revival with strong performance of intermediate goods, suggesting end to end manufacturing sector growth.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby A Nandy » 03 Nov 2020 12:33

https://swarajyamag.com/insta/641-milli ... -years-ago

In a positive development, the total number of E-way bills generated in October surged to 64.1 million, the highest tally recorded since the E-way bill system was introduced more than two years ago, reports Economic Times.

This comes as 27,400 taxpayers generated about 49.5 million electronic invoices in since 1 October when the e-invoice system under GST came into force for all companies with an annual turnover of Rs 500 crore or more.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby vijayk » 03 Nov 2020 16:39

Wouldn't this recovery be further helped by reducing GST rates?

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby JTull » 03 Nov 2020 17:44

vijayk wrote:Wouldn't this recovery be further helped by reducing GST rates?


Who's then going to pay for expenditure? Or should we just accept 20% fiscal deficit, further govt borrowing, high cost of corporate borrowing and extreme inflation.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby tandav » 03 Nov 2020 19:08

JTull wrote:
vijayk wrote:Wouldn't this recovery be further helped by reducing GST rates?


Who's then going to pay for expenditure? Or should we just accept 20% fiscal deficit, further govt borrowing, high cost of corporate borrowing and extreme inflation.



I think it is better to have 0 taxation... only have Deficit financing where the Govt prints money and uses it for financing infrastructure, education, healthcare, defense. Citizens pay the Mehngai tax...

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Vips » 03 Nov 2020 19:33

UPI hits 2 billion payments mark in October on festive, Covid push.

Payments through Unified Payments Interface (UPI) crossed the 2-billion mark in monthly transactions for the first time in October. UPI
transactions took three years to clock the 1-billion mark in October 2019, the current leap took just one year.
The incremental demand for
contactless payments due to the pandemic as well as spends during the ongoing festive season helped fuel this growth.

National Payments Corporation of India (NPCI), which manages UPI, said the platform saw nearly 2.1 billion transactions in October worth over Rs
3.8 lakh crore. This is a 15% growth in volume compared to September, when it had recorded 12% growth over August
. Digital transactions through other instruments like IMPS, Bharat BillPay and Fastag, an indicator of vehicular movement, have been rising too. In October, bill payments rose to nearly 24 million compared to just over 23 million in September, while Fastag saw over 122 million transactions in October as against 110 million in September. IMPS clocked 319 million payments in October compared to about 280 million in September, according to NPCI data.

While increased demand for digital transactions has accelerated UPI’s journey to the 2-billion mark, industry executives said it would be a challenge to maintain this volume every month, when its stakeholders are shying away from investing in scaling up UPI’s technology infrastructure. This is largely attributed to the zero merchant discount rate (MDR), according to an industry executive. The government had made MDR zero earlier this year to expand digital payments but instead the move has hit banks and payments apps — industry stakeholders — as they are unable to make money on these transactions.

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Some banks had started to limit free UPI transactions, which prompted the government to issue a circular in August saying lenders must stop charging these transactions and should issue a refund, if case a user has been charged already.

“Failure rates are increasing and it takes longer for a transaction to complete. Banks are not investing to add muscle to the infrastructure as they can’t make money on UPI transactions due to zero MDR. It’s being discussed across the industry but there is no respite yet,” an industry executive said, adding that.one of the country’s largest banks had a success rate of about 70% in October.

Sajith Sivanandan, MD & business head (Google Pay and Next Billion User Initiatives), Google India, said the latest milestone serves as a “global proof of concept for technology-enabled financial inclusion”.

“This offers immense learning for economies around the globe, as much as India. As UPI grows from strength to strength, there is a need for continued technology investments towards the infrastructure in order to bring a reliable and failure-proof experience to the user,” he said.
Google Pay processes the highest volumes of UPI payments with roughly over 40% share. While PhonePe comes in the second position, Paytm and Amazon Pay are the other top UPI apps.

“UPI is now the digital currency of the country and we are taking this deeper & deeper into tier-4,-5,-6 towns & villages both with consumers and merchants. Such deeper adoption of digital payments will usher in financial inclusion & accelerate economic progress in the country. All the stakeholders will have to continuously invest to be able to manage the scale and growth of UPI,” said Hemant Gala, head (payments, banking & financial services), PhonePe.

A Paytm Payments Bank spokesperson said it was among the top contributors offering the best technology to support UPI transactions that results in the lowest decline rate, “thereby accelerating the overall growth of digital payments in small cities and towns”.


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