BUSINESS
India's merchandise trade deficit widens to $23.78 billion in May
While exports rose nearly 9 percent from April to $38.13 billion in May, imports shot up 14.45 percent to $61.91 billion
WORLD
UK's Labour Party manifesto says it will seek new strategic ties with India, including FTA
Ahead of the 2024 general elections in United Kingdom (UK), the Labour party released their manifesto on June 13 outlining the programme for the government for the next five years. The party will also focus on deepening co-operation with India in areas like security, education, technology and climate change, as per the manifesto.
BUSINESS
Private capex still on sidelines; may pick up towards 2024-end: Fitch Ratings' Zook
Zook said that though public capex has been supportive, if the government is hoping to consolidate, then the strong growth impetus seen so far may fade.
BUSINESS
India bond inclusion may not lower borrowing costs aggressively: Fitch Ratings' Jeremy Zook
Zook added that the potential volatility from hot money flows are likely to be limited as well since the increase in foreign participation, on account of inclusion of Indian bonds in global indices, is expected to be relatively modest in the foreseeable future.
BUSINESS
India's fiscal strategy beyond FY26 key to any positive rating action, says Fitch's Jeremy Zook
The government is looking to bring its fiscal deficit target to below 4.5 percent of GDP by FY26 and is targeting 5.1 percent in the ongoing financial year. According to Fitch Ratings' Zook, the upcoming Budget is likely to see a slight shift in the composition of spending with more thrust on social measures, but that will not have any impact on the government's fiscal consolidation path.
BUSINESS
Spending rejigs to aid welfare spend while maintaining fiscal prudence in Budget 2024: Sources
One way to use the higher RBI dividend could be to lower the fiscal deficit target further, given that there is scope to reorient spending towards schemes that boost consumption. The full Budget will be presented on July 23.
BUSINESS
Retail inflation eases to 12-month low of 4.75% in May
The fall in headline rate comes despite little change in food inflation levels that remained elevated at 7.9 percent in May
INDIA
Farm sector growth may be over 4% in FY25, thanks to a good monsoon: Ramesh Chand
The NITI Aayog member believes that given better rainfall prospects this year, food inflation may also cool down, but with a lag.
BUSINESS
Modi 3.0: Nirmala Sitharaman returns as India's finance minister
Her reappointment to North Block puts to rest days of speculations over a change in portfolio for India's first full-time female finance minister.
BUSINESS
Should we worry about GDP growth under coalition regimes?
Coalition governments and GDP growth are not mandatorily correlated. India has in the past, managed to do reasonably well without single-party majorities at the helm of affairs. And a country’s economic performance depends on a whole host of factors including global economic conditions.
BUSINESS
Rural India’s monthly per capita cereal consumption fell below 10 kgs in 2022-23
While in Urban India, consumption of cereals declined to 8.05 kgs in 2022-23 from 9.32 kgs in 2011-12, in rural households it decreased to 9.61 kgs in from 11.23 kgs during the same period, according to a detailed report on Household Consumption Expenditure Survey (HCES) released by the Ministry of Statistics and Programme Implementation (MoSPI) on June 7.
BUSINESS
Milk occupies giant share in Haryana’s food bill; rural Rajasthan spends least on eggs, fish & meat
Rural Haryana spends 41.7 percent of its total food expenditure on milk and milk products, shows a detailed survey on the Household Consumption Survey for 2022-23 released on June 7. This is in stark contrast to the trend given that both in rural and urban India, the share of spending on beverages and processed food in total food consumption has been maximum in 2022-23 for almost all the major states.
BUSINESS
Bihar, Andhra Pradesh special status demand throws up fiscal, political dilemmas
In April 2015, the 14th Finance Commission discontinued the practice of giving special category status to states, with some exceptions, which means the BJP will have to look for other ways to fulfil the reported demands of its allies TDP and JD(U) for the grant of such a status to Andhra Pradesh and Bihar, respectively.
BUSINESS
A Modi 3.0 that reins in overzealous tax officials
Industry expects the incoming government to tone down the bureaucratic actions that have led to a flurry of GST evasion notices for gaming firms, as well as retrospective demands from startups on angel tax
LOK-SABHA-ELECTION
MC Analysis | A weaker Modi mandate could put welfarism ahead of fiscal prudence
An economist pointed out that if the BJP and its alliance do not win the numbers it has targeted, then a big-bang Budget oriented towards welfare measures to boost consumption may be on the anvil
ELECTION
Full Budget may see quicker fiscal consolidation, higher capex if BJP wins big
Beyond fiscal prudence and capex, a potential Modi-led government that has an absolute majority is also expected to stay focused on strategic sectors, in line with its stated post-election ambition of attaining a $30-trillion ‘Viksit Bharat by 2047’ by betting on private capex picking up as well as on measures to consolidate foreign investments.
BUSINESS
Centre's FY24 fiscal deficit at 5.6% of GDP, lower than revised estimate of 5.8%
The fiscal deficit came in at Rs 16.54 lakh crore, or 95.3% of the estimate
BUSINESS
GDP growth surpasses estimates at 7.8% in Q4; FY24 tops 8%
India is seen growing 8.2 percent in 2023-24 thanks to the manufacturing and mining sector. However, farm sector GVA is seen slowing down to 1.4 percent in FY24 against 4.7 percent in 2022-23.
BUSINESS
India's inflation tug-of-war: Falling headline rate versus rising food prices
As political rhetoric around Inflation increases, Moneycontrol takes stock of how inflation has fared in India over the years and versus globally.
BUSINESS
FM hints at reconsidering 45-day payment rule for MSMEs
The tweaked Income Tax rule bars businesses from claiming tax deductions for payments beyond 45 days from MSMEs for supply of goods and services.
BUSINESS
High GDP growth to youth unemployment: What the incoming govt will inherit on June 4
On the fiscal side of things, a higher than expected dividend payout from the RBI may aid the government in sticking to the path of consolidation, while Consumer Price Index inflation at 4.83 per cent in April continued its downward trajectory.
BUSINESS
Early UK polls will allow FTA talks with India to resume quickly, says UKIBC's McCallum
Experts feel that early elections in the UK are positive for the ongoing FTA negotiations.
BUSINESS
India plans to upskill and add negotiators for FTA talks
The move to ramp up the number of officials directly involved in trade pact talks as well as finalising a standard operating procedure comes at a time when India is negotiating such deals with a number of nations and groupings.
BUSINESS
Analysis: Congress guarantees may cause fiscal slippages. Can India afford it?
According to an economist who spoke on the condition of anonymity, the schemes outlined by the Congress in their manifesto could lead to a slippage of 1.5-2 percentage points to the fiscal deficit target of 5.1 percent for FY25 assuming everything else stays the same. But, measures like rationalising expenditure coupled with higher revenues on account of a widening tax base could very well limit any potential, sharp escalations to the deficit.
