Page 20 - India Economy

Female labour force participation rate reaches 37% in 2023: Research

This growth reflects a positive shift in the country's labour force dynamics, with more women participating actively in the workforce

Managing expectations

Sustained higher inflation can affect outlook

India has high debt like China, but risks are moderated: IMF official

India has a high debt like that of China but the risks associated with it are not as great as that of its northern neighbour, a senior official from the International Monetary Fund has said, advising India in the medium term to have an ambitious fiscal consolidation plan that brings down deficits. "The current debt in India is also high. It stands at 81.9 per cent of GDP. Compared to China, which is 83 per cent, it is very similar. Also, when we compare India's debt to the pre-pandemic level in 2019, it was 75 per cent. So it is still quite a bit higher," Ruud de Mooij, Deputy Director, Fiscal Affairs Department at International Monetary Fund, told PTI in an interview. "What we also see in India is a deficit that is 8.8 per cent projected for 2023. In India, a large portion of this is because of expenditures on interest. They pay a lot of interest on their debt: 5.4 per cent of GDP is spent on that, and the primary deficit is 3.4 per cent. So together they add up to 8.8 per cent," he

Indian economy needs 8% growth to topple China as global driver: Barclays

The South Asian nation should focus investment in areas like mining, utilities, transport and storage - sectors that have stronger spillover effects on the broader economy, said Barclays economist

States borrowing cost soars to highest so far this fiscal at 7.68%

States have been forced to pay through their nose at the weekly auction of their debt on Tuesday with the weighted average interest rate payable soaring to the highest so far this fiscal at 7.68 per cent, 12 basis points (bps) more than the previous peak at the last auction. The prices shot up reflecting the overall higher risk averseness of investors with the rising interest rates along with higher demand, which rose by 14 per cent at the auction in spite of a jump in the average tenor to 15 years from 13 years last week. Eight states raised Rs 9,600 crore through state government securities (SGS) on Tuesday, which is 13.6 per cent higher than the amount indicated for this week in the auction calendar, according to Aditi Nayar, the chief economist at Icra Ratings. The sharp increase in the cutoffs of the 10-year and above issuances in the auction pushed the weighted average cut-off to 7.68 per cent, the highest in FY24 so far, up from 7.56 per cent last week, she said. The weighte

India's net direct tax collection rises 22% to over Rs 9.57 trillion

The net direct tax collection increased by 21.82 per cent to over Rs 9.57 lakh crore till October 9, helped by good inflow from corporates and individuals, the Finance Ministry said on Tuesday

Alcohol beverage industry may see margin contraction in FY24: ICRA

The domestic alcohol beverages (alcobev) industry is expected to have revenue growth of 8-10 per cent in 2023-24 but operating margins may contract by 90-140 basis points due to input cost pressure, a report by rating agency ICRA stated. The industry revenues are estimated to grow, helped by volume growth and product mix benefits, the report based on a sample set of domestic alcobev companies said. "Industry operating profit margin (OPM) to contract by ~90-140 basis points in FY24 due to input cost pressure, especially grain prices and packaging materials," it said. The alcobev industry witnessed a strong revival in the last fiscal in FY23 led by a healthy demand across both segments -spirits and beer, after two consecutive pandemic-hit years of FY21 and FY22 "During Q1 FY2024, the spirits industry reported a 13 per cent YoY increase in revenues despite being the lean season for the segment, while the beer industry, despite being the peak season, witnessed a marginal decline of ~1%

India in a sweet spot as rift between West, China grows: Economist

India is in a sweet spot globally given the growing rift between Western nations and China, eminent economist Kaushik Basu has said and expressed hope that the country will hold out on three pillars -- democracy, free media and secularism -- which made India special. Basu, currently a professor of economics at Cornell University, said that these three pillars are particularly needed now with all the post-Covid economic and social uncertainties that the world is going through. "Given the growing rift between Western nations and China, India is in a sweet spot, globally," Cornell University said in a statement quoting Basu. According to Basu, among the many nations that became independent in the last century, India stood out for its democracy, free media and secularism. "They provide foundations for economic growth. One hopes that the nation will have the wisdom to hold on to these political pillars which made India special," he said. A major conference on the Indian economy will be

Govt to scale back on investment as it curbs budget deficit: Goldman Sachs

This move will give the private sector scope to pick up the slack in the coming years

Urban unemployment rate dips to 6.6% during April-June 2023: Govt survey

The unemployment rate for persons aged 15 years and above in urban areas declined to 6.6 per cent during April-June 2023 from 7.6 per cent a year ago, the National Sample Survey Office (NSSO) data showed. Joblessness or unemployment rate is defined as the percentage of unemployed persons in the labour force. Joblessness was high in April-June 2022 mainly due to the staggering impact of Covid-related restrictions in the country. The unemployment rate (UR) for persons aged 15 years and above in April-June 2022 was 7.6 per cent in urban areas, the 19th Periodic Labour Force Survey (PLFS) showed. In January-March 2023, the unemployment rate was 6.8 per cent. It was 7.2 per cent in July-September 2022 as well as October-December 2022. It also showed that the unemployment rate among females (aged 15 years and above) in urban areas declined to 9.1 per cent in April-June 2023 from 9.5 per cent in the same quarter a year ago. It was 9.2 per cent in January-March 2023, 9.6 per cent ...

GST Council 'cedes right' to states on taxing neutral alcohols: FM

Strap: GST Council has slashed rates on molasses, millet mix, cleared air on corporate guarantee

Weekend Bites: RBI kills one bird with one stone, future of 50-over cricket

In which we munch over the week's platter of news and views

India's forex reserves declines by $3.79 billion to $586.91 billion

In the previous reporting week, the overall reserves had declined by USD 2.335 billion to USD 590.702 billion as of September 22

Household savings rate plummeted to five-decade low in 2022-23: RBI

The household savings rate plummeted to a five-decade low in 2022-23 as people started spending after the restrictions on movement ended after the pandemic, the Reserve Bank of India said on Friday. Deputy Governor Michael Patra said the dip in net financial savings of households to 5.1 per cent of the Gross Domestic Product (GDP) in FY23 also includes an increase in liabilities, much of which are home loans that will show as investments in the next year. When asked if the decline in savings to a 47-year-low is indicative of over-leverage among the households, Patra reminded that historically, the average household savings rate was about 7.5 per cent but during the pandemic, it had gone up due to a variety of factors, including inability to spend due to the restrictions and also because of precaution savings. "as these movement restrictions were removed, people went out to spend and started to draw down those precaution savings. That is some of the phenomenon that we're seeing now,"

India poised to become new growth engine of world, says RBI Governor

India is poised to become the new growth engine of the world, Reserve Bank of India Governor Shaktikanta Das said on Friday as the central bank retained the country's GDP growth forecast at 6.5 per cent for 2023-24, notwithstanding the slowing global economy. Invoking Kautilya's Arthashastra, Das said macroeconomic stability and inclusive growth are the fundamental principles underlying a country's progress. "The policy mix that we have pursued during the recent years of multiple and unparalleled shocks has fostered macroeconomic and financial stability," he said, while unveiling the bi-monthly monetary policy review. He said the external sector also remains eminently manageable. Das further said the twin balance sheet stress that was encountered a decade ago has now been replaced by a twin balance sheet advantage with healthier balance sheets of both banks and the corporate. "India is poised to become the new growth engine of the world," he said, observing the global economy is ..

Citi India sees $22 billion in equity capital deals in 2023, says CEO

"Initial public offerings have come back and you have seen a flurry of block deal activity given where markets are. Now we are starting to see institutional share sales as well," said Ashu Khullar

Softening of tomato prices brings down cost of veg, non-veg thalis in Sept

The tomato prices shrunk 62% in September to Rs 39 per kilogram (kg) as compared to Rs 102 per kg in August

Domestic demand for non-ferrous metals to grow 9% over two fiscals: ICRA

The domestic demand growth rate for non-ferrous metals is expected to remain healthy at 9 per cent in the next two financial years, according to Icra. The ratings agency also informed that the non-ferrous metal industry's profit margins to remain under pressure amid weak global environment. Aluminium, copper and zinc are some of the non ferrous metals. "The domestic demand growth rate is expected to remain healthy at 9 per cent in the next two fiscals and would sharply outpace the expected rate of global demand growth. Thus, Icra has maintained stable outlook on the sector," the agency said. Jayanta Roy, Senior Vice-President and Group Head, Corporate Sector Ratings, Icra, said the global consumption of non-ferrous metals decelerated during the current calendar year due to sluggish demand conditions, primarily in the developed nations. He further said that while there has been a partial recovery in demand from China compared to the lacklustre performance in the previous calendar y

Airbnb contributed over $920 million to India's economy in FY23: Research

A report based on research by Oxford Economics has claimed that Airbnb contributed over USD 920 million to India's GDP and supported over 85,000 jobs in the country between April 2022 and March 2023. The report compares the findings for FY23 in terms of GDP contribution and jobs supported in India during the period between April 2019 and March 2020. The findings were not released for two fiscal years. According to the report, Airbnb guests spent a total of USD 815 million in India during FY23, more than double of the FY20 levels. In India, Airbnb's presence was the highest in Goa, where Airbnb guests spending amounted to almost USD 190 million. This was followed by Bengaluru and Delhi, Mumbai and Manali, it stated. James Lambert, Director for Economic Consulting in Asia for Oxford Economics, said: "Domestic travellers have been crucial to the tourism sector's resilience over the past three years as Indian guests saw opportunities in domestic travel as a substitute for international

States' borrowing cost jumps 10 bps to reach 23-week high of 7.56%

States' borrowing cost jumped 10 basis points to 7.56 per cent at the first weekly debt auction of the third quarter on Tuesday and is the highest in the the past 23 weeks. Fourteen states raised Rs 22,500 crore through the issuance of state government securities in line with the indicated amount for this weekly auction for the third quarter calendar. According to Aditi Nayar, the chief economist at Icra Ratings, the auctions saw a steep increase in the cut-offs across tenors leading to the weighted average cost jumping to a 23-week high of 7.56 per cent. It stood at 7.46 percent last week. The higher pricing of the borrowing is despite a steep decline in the weighted average tenor to 13 years from 17 years, Nayar said. Moreover, she said the spread between the cut-off of 10-year state bonds and the new 10-year G-Secs (7.18 GS 2033) yield rose mildly to 33 bps from 32 bps last week. On an annualised basis to the week, the states have drawn down 15.4 per cent more than what they