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Modi 3.0: Moody's anticipates steady policies but sees reform delays

Wed, 06/05/2024 - 04:16
The BJP-led National Democratic Alliance's (NDA) slim majority in Lok Sabha may delay more far-reaching economic and fiscal reforms that could impede progress on fiscal consolidation, Moody's Ratings said on Wednesday. NDA securing a majority in the general elections will give a historic third term for Narendra Modi as Prime Minister of India. "We expect policy continuity, especially with regards to budgetary emphasis on infrastructure spending and boosting domestic manufacturing, to support robust economic growth. "However, the NDA's relatively slim margin of victory, as well as the BJP's loss of its outright majority in parliament, may delay more far-reaching economic and fiscal reforms that could impede progress on fiscal consolidation," Moody's said in a note. India's fiscal outcomes will remain weaker than Baa-rated peers, even as the final budget for the fiscal year ending March 2025 (fiscal 2024-25) to be released in the next few weeks provides some indications of India's ..

RBI's Monetary Policy Committee second meeting of FY25 from June 5-7

Wed, 06/05/2024 - 03:45
A poll by Bloomberg revealed that economists expected the India's central bank to maintain the repo rate at 6.5 per cent for the eight consecutive time

Weak majority for BJP poses challenges to reform agenda, says Fitch

Wed, 06/05/2024 - 03:40
The BJP losing its outright majority and relying on allies to form a government could pose challenges for the more ambitious elements of reform agenda like land and labour, Fitch Ratings said in a note on Wednesday. Prime Minister Narendra Modi-led BJP lost its majority for the first time since 2014, winning 240 seats in the 543-seat Lok Sabha. It plans to form a government with smaller parties in his National Democratic Alliance, which won another 52 seats, giving the alliance a 292-seat majority. "It appears the BJP-led NDA is likely to form the next government, returning Prime Minister Modi for a third term, but with a weakened majority that could pose challenges for the more ambitious elements of the government's reform agenda," Fitch said. As the BJP fell short of an outright majority and will need to rely more heavily on its coalition partners, "passing contentious reforms could prove more difficult, particularly around land and labour, which have recently been flagged as ...

PM Modi's weaker mandate to slow India's fiscal tightening, says Moody's

Wed, 06/05/2024 - 02:31
India's benchmark 10-year bond yield saw its biggest surge in eight months following the poll outcome

May services growth cools to five-month low of 60.2 from April's 60.8: PMI

Wed, 06/05/2024 - 01:25
The final HSBC India Services purchasing managers' index, compiled by S&P Global, fell to 60.2 last month from April's 60.8, confounding a preliminary reading for a rise to 61.4

Election results: India's economic fundamentals remain robust, says Nomura

Tue, 06/04/2024 - 23:05
India's economic fundamentals remain robust, investment bank Nomura said on Wednesday after the results of the country's general elections paved the way for Prime Minister Narendra Modi's third consecutive term in office. Modi is poised to form the government for a third consecutive term with the BJP-led National Democratic Alliance (NDA) getting a majority in the Lok Sabha, notwithstanding crushing losses in three Hindi heartland states after a bitterly fought election that was projected as a referendum on his popularity. The Election Commission of India has declared results for all 543 Lok Sabha constituencies, with the BJP winning 240 seats and the Congress 99. "Our assessment is that India's economic fundamentals remain robust. Reforms in India have generally survived the test of politics and we expect the government to continue the pace of governance and administrative reforms, leaving states to work around the more intractable reforms around land and labour," Nomura said. Whi

IPEF's clean economy investor forum meet in Singapore to begin on Jun 5

Tue, 06/04/2024 - 14:08
Senior officials from the commerce ministry will participate in the two-day clean economy investor forum meet in Singapore, organised by Indo-Pacific Economic Framework for Prosperity (IPEF), an official said. Commerce Secretary Sunil Barthwal, Additional Secretary in the ministry Rajesh Agrawal, and other senior officers have reached Singapore for the meet, which will start on June 5. "Indian projects would be pitched in the forum. Over 150 investors would participate," the official said. The Indo-Pacific Economic Framework for Prosperity (IPEF) was launched in May 2022 and it currently includes 14 partners -- Australia, Brunei Darussalam, Fiji, India, Indonesia, Japan, the Republic of Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, the US, and Vietnam. It provides a platform for countries in the region to collaborate on advancing resilient, sustainable and inclusive economic growth, and aims to contribute to cooperation, stability and prosperity in the region. Th

CBIC unveils new draft, set to replace 8-decade old central excise regime

Tue, 06/04/2024 - 12:54
At present, Central Excise is levied mainly on petroleum products. As a part of the pre-legislative consultative process, CBIC has sought stakeholders' comments by June 26

'Modi retaining power under changed conditions to make reforms challenging'

Tue, 06/04/2024 - 11:30
Prime Minister Narendra Modi retaining power in the general elections under "changed circumstances" will make the implementation of critical reforms challenging, economists said on Tuesday. Economists said the results, wherein trends and leads showed the incumbent National Democratic Alliance (NDA) being set to win around 295 seats but Modi's BJP falling short of the halfway mark of 272 by itself, are a "negative surprise". "It is likely that Narendra Modi will return as PM for a third term. However, he will have to contend with changed circumstances," a note from the domestic brokerage Emkay said, adding that the broad direction of the economic policy is unlikely to change. Seeming to concur on the same, analysts at Swiss brokerage UBS said it expects the government to push supply-side reforms, including manufacturing, simplification of regulatory processes, labour law implementation, skill development and creating employment opportunities. "However, we think implementation of ...

Strong economic base to help new govt make India a developed nation by 2047

Tue, 06/04/2024 - 08:22
India's world record beating economic growth rate together with robust tax revenues, a fast expanding digital and financial infrastructure and a strong manufacturing sector will give the new government a base for unleashing next generation reforms that may make the country a developed nation by 2047. The new government will however have to tackle with problems like unemployment and rural distress, which seemed to have played a major role in voting pattern in states like Uttar Pradesh, while also keeping inflation under control. Given that no party, including BJP, have a clear majority of its own, tough reforms like big ticket privatisation and labour law reforms may take a backseat. As per the available trends, BJP is likely to win about 240 seats in a 543- member Lok Sabha. It would have to rely on its allies like TDP and JDU to form the next government. The new government will have to build upon the 8.2 per cent GDP growth recorded in 2023-24 and carry on with the reforms to make

Netherlands emerges as India's 3rd largest export destination in 2023-24

Tue, 06/04/2024 - 07:46
The Netherlands has emerged as India's third largest export destination after the US and UAE during 2023-24, even as the country's merchandise shipments dipped by over 3 per cent, according to the commerce ministry data. The main commodities which registered healthy exports growth in the Netherlands include petroleum products (USD 14.29 billion), electrical goods, chemicals, and pharmaceuticals in the last fiscal. India's trade surplus with the Netherlands has increased to USD 17.4 billion in the last fiscal from USD 13 billion in 2022-23. The Netherlands has taken over major destinations such as the UK, Hong Kong, Bangladesh and Germany. India's exports to the Netherlands rose by about 3.5 per cent to USD 22.36 billion in 2023-24 as against USD 21.61 billion in 2022-23, the data showed. In 2021-22 and 2020-21, the outbound shipments to the European country stood at USD 12.55 billion and USD 6.5 billion, respectively. The exports have been registering healthy growth continuously

Financial markets were given artificial booster dose by exit polls: Cong

Tue, 06/04/2024 - 07:00
As financial markets went for a tumble on Tuesday after the trends of the Lok Sabha poll results showed that the BJP was not getting a majority on its own, the Congress said the markets were given an artificial booster dose by the exit polls and have now turned turbulent. The Congress also recalled the words of former prime minister Manmohan Singh in 2004 to say that the party is committed to an orderly and healthy development of the financial markets that reflect the fundamentals of the economy. Congress general secretary Jairam Ramesh said the party-led United Progressive Alliance (UPA) government provided a fear-free and intimidation-free 10-year period (2004-14) for the private sector that helped the country achieve its highest GDP growth. "Financial markets that were given an artificial booster dose by the exit polls are turbulent today. In this context, it is wise to recall the words of Dr Manmohan Singh on May 17th 2004, the last occasion on which the markets were faced with

FY25 begins with tepid work demand under MGNREGA, shows govt data

Mon, 06/03/2024 - 14:04
In April 2024, around 21.51 million households sought work under the scheme, which was 10.59 per cent lower than the number of households who sought work under the scheme in April 2023

Lucknow gears up for an international business conclave on June 15-16

Mon, 06/03/2024 - 13:59
The International Business Conclave 2024, organised by the state's Associated Chambers of Commerce and Industry (Assocham), will focus on trade with Gulf, Asian, European, and Latin American countries

Bonds, rupee strengthen as exit polls predict comfortable majority for NDA

Mon, 06/03/2024 - 09:04
The Reserve Bank of India (RBI) intervened in the foreign exchange market to mop up dollars to contain volatility in the exchange rate, said market participants

New govt expected to 'push the accelerator' on reforms: Assocham President

Mon, 06/03/2024 - 06:15
Nayar also pointed out that it is necessary for investment growth to propel the supply side in order to get a balance "between cyclical consumption-driven growth and inflation."

Heatwave drags manufacturing growth to three-month low in May: PMI data

Mon, 06/03/2024 - 04:31
But the sector remains in expansionary territory in May. Manufacturing employment rose to one of the greatest extents seen since data collection started in March 2005

India's May factory growth slips to 3-month low, but remains sturdy: PMI

Mon, 06/03/2024 - 01:12
The HSBC final India Manufacturing Purchasing Managers' Index, compiled by S&P Global, dipped to 57.5 in May from April's 58.8, below a preliminary estimate of 58.4

MPC likely to maintain status quo for eighth time in a row: BS poll

Sun, 06/02/2024 - 13:51
Respondents cite moderate inflation data, outlook for food prices, high growth

Test of endurance: Narendra Modi's second lap outruns Manmohan Singh's

Sun, 06/02/2024 - 12:57
But 10-year returns finish line still elusive