Even though the stock market may seem buoyant, Robert Prior-Wandesforde of Credit Suisse says one cannot expect any meaningful pick-up in the economy till rates are cut. And even after that, he says, the economy will take at least a year to revive its growth rate.
Fitch Ratings, which had lowered India's credit outlook to negative from stable on June 15, 2012, has said that possibility of downgrading the country's sovereign rating is more than 50% in the next 12-24 months.
CLSA, a brokerage, has also cut its forecast for 2012-13 to 5.5% from the 6% forecast earlier, as a deficient monsoon piles on more misery on the Indian economy buffeted by high inflation, tight monetary policy, rising fiscal deficit and weakening currency.
Armed with the latest monsoon rainfall data, weather experts finally conceded this month that India is facing a drought, confirming what millions of livestock farmers around the country had known for weeks.
A committee headed by former Union Bank Chairman MV Nair recommended that banks may directly lend 9% to small farmers and 7% to micro industries. The remaining targets were to be loosely defined to include even lending to warehousing and cold chain as lending to agriculture.
Priority Lending Rules originated in 1968, along the time when banks were nationalised with the aim of using their funds for national building. Banks were told to lend one third of their funds to sectors that the government determined as priority; largely agri and small scale. By 1985 this proportion rose to 40%.
With a view to improving customer services and speeding up fund transfer, the Reserve Bank today asked all CBS (core banking solutions)-enabled banks to issue multi-city cheques to all eligible customers and refrain from levying clearing charges on them.
India's per capita income can reach levels of USD 8000-10,000 by 2025 from the present USD 1600 if the economy grows at 9% annually, Chairman of Prime Minister‘s Economic Advisory Council C Rangarajan said here today.
India's exports target of USD 500 billion by 2013-14 is unlikely to be achieved as the exports may not even touch last year's level of about USD 304 billion in the current fiscal due to weak demand in global markets, says an Assocham study.
The return of a pro-market reformer to India's finance ministry has cheered investors and contributed to a market rally, but Palaniappan Chidambaram will need both political deftness and some luck to tackle the problems dragging the economy down.
Shankar Acharya, ICRIER, says that yesterday‘s IIP data displayed a poor growth story and he feels that the production performance in the agriculture sector is also not likely to show a good performance due to poor monsoons.
Worsening economic situation pulled down industrial output by 1.8% in June, a third fall in four months, disappointing finance minister P Chidambaram who said that bottlenecks must be removed to facilitate fresh investments in critical sectors.
Montek Singh Ahluwalia, Deputy Chairman, Planning Commission admits that industrial growth has disappointed. However, he is still optimistic about the GDP number staying between the 6 and 6.5% mark this year.
The Finance Ministry today said it is committed to bringing down burgeoning fiscal deficit and will soon come out with an action plan to achieve this objective.
The country's urea imports are expected to rise by about 15% to 9 million tonnes (MT) this fiscal, even as its domestic production is expected to be up by 2% to 22.5 MT in the same period, the government said today.
Mecklai Graph: FIIs inflow in India, YTD - The Indian financial markets have witnessed favouritism among the investing Diaspora compared to its Asian counterparts such as South Korea, Taiwan, Thailand and Indonesia.
GAAR panel head Parthasarathi Shome has announced that the panel will examine all issues relating to GAAR and submit a draft of the recommendations by end of August and submit the official report by September-end.
Expressing serious concerns over contraction in industrial production, industry today called for immediate policy measures to boost investments in the country.
Indian inflation probably crept up in July as poor monsoon rains drove food prices higher, a Reuters polls showed on Wednesday, giving the RBI less room to cut interest rates to revive a flagging economy.
Amid slowdown in economic activities, the government today said it will reassess the fiscal deficit target of 5.1% of GDP for the current fiscal after mid-year review of the economy.
Even though most economists had expected a dismal showing in the month of June, 1.8% contraction the industrial production surprised one and all.
K Ravi Kumar, former chairman, BHEL and now with Abhijeet Power, says that the continuous decline in numbers in the last five months is a reason for worry. High interest rates and weak order pipeline is affecting the capital good sector.
India's industrial production contracted 1.8 percent in June, driven down by a slump in manufacturing, government data showed on Thursday.
Index of Industrial production for the month of June has come in at negative 1.8%, way below the CNBC-TV18 poll number of 1%.
While analysts expected the June Index of Industrial Production (IIP) data, to be around 1%, it was well below expectations and was reported to be -1.8%. Indranil Sengupta, Chief Economist India at BofA ML too believed the number was going to be 1%, down from last month's 2.4%.