สรุปข่าวเศรษฐกิจอินเดียประจำวันที่ 29 สิงหาคม 2556
Asian financial crisis unlikely: S&P
With uncertainty over Fed bond purchase tapering and slowing growth rattling financial markets, global rating agency Standard & Poor's on Wednesday warned of a "rocky" road ahead for countries like Indiaand Indonesia on the current account front but ruled out chances of another Asian crisis.
Asia is witnessing bourses and currencies coming under pressure, funding costs are rising, and some company balance sheets are coming under stress. "The road may be rocky in the near term, particularly for the largest deficit countries — India and Indonesia — but we don't think this is the Asian crisis all over again," S&P said in a report.
The past few months haven't been pretty. In early May, US Federal Reserve chairman Ben Bernanke discussed in a speech the likely timing of the start of Fed "tapering" (that is, lower bond purchases). Since then, market participants have sold assets in the markets with the highest risk, sometimes aggressively. And emerging economies in Asia have certainly seen their share of the sell-offs.
(Source: Business Standard, the Financial Express)
Govt should project investors from the illegal schemes: RBI
Reserve Bank of India (RBI) governor D Subbarao said on Wednesday that it is the responsibility of the central bank, as well as the government, to protect investors from financial frauds against the backdrop of chit fund schemes going bust in West Bengal and elsewhere.
Subbarao suggested a two-pronged approach: spreading awareness on the dubiousness of such schemes among investors and deepening of financial inclusion, so that the common people's savings are routed to the formal financial system. The outgoing governor also said financial inclusion and financial literacy were among the top priorities for the central bank. He said RBI and the government had been running advertising campaigns in Hindi and regional languages, and have requested banks to help in these efforts.
Recently, the high-profile Saradha group in West Bengal went bust, putting the hard-earned money of thousands of investors in jeopardy. The incident has triggered an intense debate over how to regulate chit funds.
(Source: Business Standard, the Financial Express)
Easier norms fail to kill SEZ denotification queue
Despite recent norms aimed at reviving investor interest in special economic zones (SEZs), developers continue to queue up for denotification. Seven such pleas will be considered by the board of approval (BoA) under the commerce and industry ministry on August 30.
The largest SEZ that will come up for denotification belongs to the Kalyani Group, which has asked the BoA to reduce the notified area of the multi-product SEZ from 1,000 hectare to 100 hectare and retain the balance 100 hectare as a sector-specific engineering and electronics SEZ.
The developer cited poor demand for plots in the SEZ and an adverse impact of minimum alternate tax (MAT) and dividend distribution tax (DDT). While MAT is applicable at the rate of 18.5% of the book profit after April 1, 2011, the DDT was levied from June 1, 2011 on dividends distributed by SEZ developers at 16.22%. The commerce ministry expects denotifications to continue despite the relaxations as states like Maharashtra have started allowing units to develop 40% of the industrial areas for non-industrial purposes like residential colonies and other commercial activities.
(Source: the Financial Express)
Goa approves to upgrade rural infrastructure
The Goa government has approved an infrastructure upgradation scheme which provides Rs. 1 crore each for village panchayats to provide basic social services to citizens.
The Goa cabinet approved the scheme today, which was announced earlier in the state budget by Goa Chief Minister Manohar Parrikar. State Panchayat Minister Laxmikant Parsekar told reporters after the cabinet meeting that panchayats will have to create durable assets with the money given to them."Panchayats will have to submit their proposals before applying for the money," he said.
The Goa government had earmarked Rs. 35 crore for the scheme under the current financial year, while Rs. 20 crore annually would be added to ensure that all 90 village panchayats are covered.
(Source: Business Standard)
Rupee impact likely to see India at 6%-plus inflation
Wholesale Price Index (WPI)-based inflation might breach the 6%-mark in the coming months, against 5.79% in July, owing to the rupee's fall.
In the three months till June, WPI-based inflation stood within the Reserve Bank of India's (RBI) comfort zone of 4-5%. In its monetary policy review last month, RBI had said it would try to restrict inflation to 5% cent by the end of this financial year.
"The impact on inflation would be seen in a period of time, not in the immediate month. It depends on what level exchange rates settle at," said Madan Sabnavis, chief economist, CARE Ratings. He added there would be a 0.5-1% impact of imported inflation in the coming months, which could lead to WPI-based inflation exceeding 6%.
(Source: Financial Express, Business Standard)
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