Page 20 - India Economy

Russian oil freight rates jump by 50% as US boosts scrutiny of price cap

G7 imposed sanctions in last Dec prohibiting shippers or insurers domiciled in member countries from offering services to facilitate Russian oil exports when the price is above $60 a barrel

States on course to spend 29% more in capex this fiscal: ICRA report

States are on course to spend 29 per cent more on capital expenditure in the ongoing fiscal, aided by additional central grants and market borrowings, a report said on Tuesday. The increased capex spending will see their debt-level in relation to their gross domestic product rising to 30 per cent from 28.9 per cent in FY23, a report by Icra Ratings said. The combined capital spending of 13 major states will rise 29 per cent this fiscal to Rs 6.2 lakh crore from Rs 4.8 lakh crore in FY23, the report said. However, despite the year-on-year growth, the capex spending is likely to be Rs 50,000 crore lower than the FY24 Budget estimates of Rs 6.7 lakh crore, Icra said. The aggregate fiscal deficit of these states for FY24 is expected to go up by Rs 60,000 crore to Rs 8.3 lakh crore as against the budgeted estimate of Rs 7.7 lakh crore, the ratings agency said. With revenue likely to trail budgeted targets, revenue and fiscal deficits of these states are expected to be Rs 2.1 lakh crore

India to spend nearly Rs 143 trn on infra between FY24 and FY30: CRISIL

India will spend nearly Rs 143 lakh crore on infrastructure between fiscals 2024 and 2030, more than twice the Rs 67 lakh crore spent in the past seven financial years starting 2017, rating agency Crisil said on Tuesday. Of the total, Rs 36.6 lakh crore will be green investments, marking a five times rise compared with the amount spent during fiscals 2017-2023, it added. "India's infrastructure spending will double to Rs 143 lakh crore between fiscals 2024 and 2030, compared with 2017-2023," Crisil said in its Infrastructure Yearbook 2023. Crisil Ltd managing director and CEO Amish Mehta said the agency expects India's gross domestic product to grow at an average 6.7 per cent through fiscal 2031 to be the fastest-expanding large economy. "Per capita income is seen rising from USD 2,500 now to USD 4,500 by fiscal 2031, creating a middle-income country," he said, adding that this growth will be underpinned by massive all-round infrastructure development, with sharp focus on integrati

Rupee ends at record closing low on intensifying geopolitical worries

The rupee closed at 83.2775 against the U.S. dollar, little changed from its previous close of 83.2625. The currency hit its previous record closing low of 83.2675 on Sept. 18

Govt maintains basmati rice floor price as grain export curbs continue

India imposed a $1,200 per ton minimum export price (MEP) on basmati rice shipments in August to calm local prices ahead of key state elections

CM Adityanath launches fourth phase of Mission Shakti in Uttar Pradesh

Women are capable of achieving remarkable feats with will power and support from the government, Chief Minister Yogi Adityanath said on Saturday while launching the fourth phase of Mission Shakti in Uttar Pradesh. Adityanath also said a campaign would be launched from October 15 as part of the fourth phase to educate people about government initiatives concerning the protection and well-being of women and girls. He launched the fourth phase of Mission Shakti, an initiative focused on promoting women's safety and self-reliance, from his official residence by flagging off a women empowerment rally. The rally, which traversed several locations in the capital, aims to enhance public awareness regarding various government schemes for the welfare of women and daughters, an official release issued here said. Citing the various government schemes which have helped women , Adityanath emphasised that "with will power and backing from the government and administration, women have the potentia

Weekend Bites: Another war, trouble in IT paradise, carmakers, 'those guys'

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

Currency markets interventions not always 'black and white': RBI Governor

Reserve Bank of India Governor Shaktikanta Das was referring to the U.S. Treasury Department's regular foreign exchange report and similar research by the International Monetary Fund (IMF)

India, Brazil target over 3-fold rise in trade to $50 bn: Commerce secy

India and Brazil are looking at an "aspirational" target of increasing the two-way trade by over three-fold to USD 50 billion by 2030, Commerce Secretary Sunil Barthwal said on Friday. He was in Brasilia from October 1 to 4 to discuss ways to promote trade between the two countries. He chaired the sixth meeting of the India-Brazil Trade Monitoring Mechanism (TMM). At present, the bilateral trade stood at USD 15.2 billion. "We are looking at USD 30 billion in the next 3-4 years and by 2030, we are looking at an aspirational target of USD 50 billion. There is a huge potential for trade growth," he told reporters here. He added that during his visit, the two sides also discussed market access issues as well as new areas of cooperation. Two working groups have been formed - market access issues and sectors of cooperation. "Biofuels and renewables are important sectors which we will be looking at...Ethanol and biofuel blending is another area of cooperation," he said. Brazil has adva

India Inc revenues to rise 8-10% in Q2, profit margins to expand: Crisil

India Inc is all set to report an 8-10 per cent jump in revenues for the September quarter while profit margins will also witness an expansion, an arm of rating agency Crisil said on Friday. This will be the first time in four quarters that the revenue growth will see an increase, it said. Automobiles, construction (which benefitted from truant monsoons) and information technology services sectors will be driving the revenue growth in the quarter, the rating agency said, adding that the year-on-year revenue growth in the preceding June quarter had stood at 7 per cent. The agency said its expectations are based on an analysis of 300 companies excluding ones in banking and oil sectors. "Growth in revenue was largely skewed towards consumer discretionary products and services, where automobiles and the retail sector led the pack, and construction-linked sectors, where companies accrued benefits from an early deployment of capital expenditure by the roads and railways ministries, Direc

Forex reserves further drop by $2.17 billion to $584.74 billion: RBI

The country's forex reserves dropped by a further USD 2.166 billion to USD 584.742 billion for the week ended October 6, the RBI said on Friday. India's forex kitty had gone down by USD 3.794 billion to USD 586.908 billion in the previous week. It can be noted that in October 2021, the country's forex kitty had reached an all-time high of USD 645 billion. The reserves took a hit as the central bank deployed the kitty to defend the rupee amid pressures caused majorly by global developments since last year. For the week ended October 6, the foreign currency assets, a major component of the reserves, decreased by USD 707 million to USD 519.529 billion, according to the Weekly Statistical Supplement released by the RBI. Expressed in dollar terms, the foreign currency assets include the effect of appreciation or depreciation of non-US units like the euro, pound and yen held in the foreign exchange reserves. Gold reserves were down by a sharp USD 1.425 billion to USD 42.306 billion, the

FTA talks between India and UK at advanced stage, says Commerce Secy

The negotiations for the proposed free trade agreement between India and the UK are at an advanced stage, and both sides are working to iron out differences on the remaining issues, a top government official said on Friday. Commerce Secretary Sunil Barthwal said that negotiations on tough issues are underway. "These negotiations are in the advance stage. These are going on, and we are ironing out the differences. We should wait till these negotiations are over because the 13th round is going on," he told reporters here. These remarks assume significance as both sides are expected to conclude the talks this month and may sign the deal in the last week. A majority of the 26 chapters are closed and for the remaining issues, high-level engagements at various levels are ongoing. An official delegation from the UK is here for the negotiations. A team led by Commerce Secretary Sunil Barthwal was in London recently to give an impetus to the talks. The UK team dealing with investment-rela

AI programme will enable to achieve $1 trn digital economy: Chandrasekhar

The government on Friday unveiled a report on the country's artificial intelligence programme, which it believes will be a kinetic enabler for India to achieve the goal of USD 1 trillion digital economy by 2026. Minister of Electronics and IT Rajeev Chandrasekhar said that the draft National Strategy on Robotics will be part of the multi-year India AI programme. "This is a deep, multi-year roadmap to make Indian AI work for being a kinetic enabler of the trillion dollar digital economy," Chandrasekhar said. The minister had earlier said the government plans to make India a USD 1-trillion digital economy by 2026. He said that apart from supporting the startup ecosystem, India's AI programme will focus on comprehensive skills in the country, building computer infrastructure etc. The report recommends creation of India data sets platform to be used by domestic startups and researchers, building GPU (graphical processing unit)-based computer infrastructure to provide resources for ...

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%