Watch sustainability champions reveal key solutions, innovations accelerating India's SDGs at ‘The Sustainability 100+ Dialogues 2021’-Haryana Roundtable on March 5 at 12pm

Economic Survey 2021-22 | India's net FPI inflows recorded all-time monthly high of $9.8 billion in November

The Survey credited the return of investors’ risk appetite in a renewed search for yield amid the COVID-19 pandemic for the high inflows

January 29, 2021 / 06:47 PM IST

The Economic Survey 2021-22 tabled in Parliament on January 29 by Union Finance Minister Nirmala Sitharaman said that net foreign portfolio investment (FPI) inflows recorded an all-time monthly high of $9.8 billion in November 2020.

The survey credited the return of investors’ risk appetite in a renewed search for yield amid the COVID-19 pandemic for the high FPI inflows. Also, the Survey cited the weakened US dollar amid global monetary easing and fiscal stimulus packages as reasons. The Survey noted that India was the only country among emerging markets to receive equity FII inflows in 2020.

Economic Survey 2021 says ‘overregulation’ leads to opaque decision making, pitches for simple regulations

ES-2021 said that within its sovereign credit ratings cohort, India is rated much below expectation given the number of sovereign defaults it has reported since 1990, which is zero, making it a negative outlier. It noted that India has never defaulted, unlike several of its cohort countries.

The survey stated that India’s sovereign external debt as a percentage of GDP stood at a mere 4 percent as of September 2020 (DEA), adding that 54 percent of India’s sovereign external foreign currency denominated debt was owed to multilaterals and the IMF as of end-March 2020 (DEA), which is not expected to impact credit rating assessments.

Close

COVID-19 Vaccine

Frequently Asked Questions

View more
How does a vaccine work?

A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine.

How many types of vaccines are there?

There are broadly four types of vaccine — one, a vaccine based on the whole virus (this could be either inactivated, or an attenuated [weakened] virus vaccine); two, a non-replicating viral vector vaccine that uses a benign virus as vector that carries the antigen of SARS-CoV; three, nucleic-acid vaccines that have genetic material like DNA and RNA of antigens like spike protein given to a person, helping human cells decode genetic material and produce the vaccine; and four, protein subunit vaccine wherein the recombinant proteins of SARS-COV-2 along with an adjuvant (booster) is given as a vaccine.

What does it take to develop a vaccine of this kind?

Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time.

View more
Show
The survey also pointed out that India’s nongovernment short term-debt as a percentage of forex reserves stood at 19 percent as of September

2020 (DEA). India’s forex reserves stood at $584.24 billion as of January 15, 2021 (RBI), greater than India’s total external debt (sovereign and non-sovereign) of US$ 556.2 billion as of September 2020 (DEA), it added.

In corporate finance parlance, therefore, India resembles a firm that has negative debt, whose probability of default is zero by definition. Despite this compelling statistic, India is an inexplicable negative outlier in its ratings cohort, ES-2021 said, adding that past episodes of rating changes have no or weak correlation with macroeconomic indicators.

"India’s fiscal policy, therefore, must not remain beholden to a noisy/biased measure of India’s fundamentals and should instead reflect Gurudev Rabindranath Thakur’s sentiment of a mind without fear," the Survey said.

The Survey opined that the sovereign credit ratings methodology should be made more transparent, less subjective and be better attuned to reflect economies’ fundamentals.
Moneycontrol News

stay updated

Get Daily News on your Browser
Sections