FY13 fiscal gap lower at 5 percent of GDP vs revised estimate: sources
India's fiscal deficit is expected to be at around 5 % of gross domestic product, lower than the downward revised estimate of 5.2 % for the 2012/13 fiscal year that ended in March, two government sources said on Thursday.
The government has cut its expenditure by a further 200 billion rupees in March which has helped in cutting the fiscal deficit, the officials said, adding the government has started the new fiscal year with a cash balance of one trillion rupees.
Also, indirect tax collection has been higher-than-expected, offsetting a shortfall in direct tax recepits in 2012/13, they added.
(Sources: Reuters India, Moneycontrol, Economic Times, Indiatimes, IBNLive, Yahoo News)
Emerging market growth remains subdued in March: HSBC
Growth in emerging economies remained subdued in March as the faster growth in China was countered by weaker expansions in Brazil, India and Russia, an HSBC survey said today.
The HSBC Emerging Markets Index ( EMI), a monthly indicator derived from the PMI surveys stood at 52.6 in March, little unchanged from the February reading when it stood at 52.4, indicating a subdued rate of economic growth in global emerging markets.
The HSBC composite manufacturing and services PMI for India decline to 51.4 in March from 54.8 in February.
(Sources: Economic Times, Indiatimes, Financial Express, Indian Express, Business Today, India Everyday)
Ambiguity over FDI, FII: RBI to soon float discussion paper
The Reserve Bank will come out with a discussion paper within 15 days on redefining Foreign Direct Investment (FDI) and portfolio investment (FII) so as to remove ambiguities.
The matter was discussed during the meeting of an eight- member committee headed by Department of Economic Affairs (DEA) Secretary Arvind Mayaram here today. The committee has been appointed for giving clear definitions to FDI and FII.
The official said that the committee would meet again after getting the views of all the stakeholders.
Finance Minister P Chidambaram in his Budget speech had proposed to follow the international practice with regard to defining FDI and FII.
As per the proposed definition, if an investor has a stake of 10 % or less in a company, the investment would be treated as foreign institutional investment (FII).
And if an investor has a stake of more than 10 %, it would be treated as foreign direct investment (FDI).
(Sources: Economic Times, Indiatimes, India Everyday, News Hour 24, Times of India, NDTV)
Price stability necessary for long-term growth: RBI Chief D Subbarao
Reserve Bank Governor D Subbarao has said that price stability was necessary for ensuring sustainable growth in the long term as it helps investors and consumers to take informed decisions.
"There might be some trade-off in the short term but in the medium to long term, you need price stability for investors and consumers to make informed choices, a necessary condition to stimulate growth", he said in an interview to a weekly magazine in Mauritius.
Referring to the economic challenges faced by India, he said, "The growth (in 2012-13) was going to be the lowest in a decade. Inflation has come off the peak but is still quite elevated. We are going to have historically the highest current account deficit this year. And investment has decelerated. So there are challenges."
However, he added, India's growth story is robust and its growth drivers are all intact. "If we do the right things from now on, we can make the promises come true".
(Sources: Economic Times, Indiatimes, Business Standard, Worldnews, Indian Express, IBNLive)
RBI to unveil monetary policy for 2013-14 on May 3
Bankers have sought a 0.5 % cut in their cash reserve requirement to tide over tight liquidity situation, and to help stem slide in investments.
They also sought a review of the elevated provisioning requirements, bankers told reporters after the customary pre-policy meeting with the Reserve Bank top brass.
Although there did not appear to be a clear consensus on what bankers wanted from the Reserve Bank in its monetary policy announcement on May 3, the larger view was that it should effect a 50 bps cut in the Cash Reserve Ratio to ease liquidity crunch.
CRR - portion of deposits that banks keep with RBI - is 4 %, after the 25 bps cut in the January policy, while the short-term lending (repo) rate is at 7.5 %.
(Sources: Business Standard, Smart Investors, Hindu Business Line, India Everyday, Moneycontrol)
Good economics can be good politics, says Montek Singh
Planning Commission deputy chairman Montek Singh Ahluwalia today said that ensuring good economic practices may not always be politically comfortable, but to think that it is impossible may be “damming the country.”
Addressing a gathering at a CII event here, Ahluwalia said that from 1991 onwards the story has been one of good economics. “I firmly believe that good economics can be good politics, but it may not be easy. The notion that good economics cannot be made good politics, I don’t think that it is correct. It can be possible if the electorate is adequately informed,” Ahluwalia added.
(Sources: Financial Express, Moneycontrol, Firstpost, NDTV, Economic Times, Business Standard)
India's domestic air traffic declined by 9% in Feb: IATA
India's domestic air traffic declined substantially by over nine per cent in February compared with the same month last year, as on average over a quarter of seats remained vacant on flights in this period, global airlines' body IATA has said.
In its latest global passenger traffic results, the International Air Transport Association (IATA) found the domestic traffic in India dropping 9.1 % in February compared to a year ago.
This decline occurred even when the global passenger demand rose 3.7 % compared to February last year.
(Sources: Zeenews, Hindu Business Line, Business Standard, Worldnews, Top News Today)
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