Feb. 1 – India’s average income for the fiscal year 2010-2011 rose 16.9 percent to reach a US$1,000 average for the first time, according to data released by the Central Statistics Office this week.
“Real GDP growth is outstripping population growth so per capita income has been on the rise,” stated D.K. Joshi, chief economist at Crisil. Continue reading
Jan. 30 – The Reserve Bank of India cut cash reserve requirements (CRR) for banks by 50 basis points last Tuesday to relieve tight liquidity, indicating a policy shift towards reviving growth after nearly two years of fighting inflation. With core inflation still inflexibly high, the RBI left its policy repo rate unchanged at 8.50 percent for the second consecutive review. The central bank had raised rates 13 times between March 2010 and October 2011, which made it one of the most hawkish central banks over that time period. Continue reading
Jan. 20 – India’s exports grew by 25.8 percent over the period running from April to December 2011, reaching a total of US$217.6 billion. The Ministry of Commerce informed that over that same time-frame, imports grew by 30.4 percent and were valued at US$350.9 billion, resulting in a negative trade balance of US$133.3 billion.
The Ministry also informed that India’s exports for the month of December 2011 were US$25 billion and imports stood at US$37.8 billion – coming out to a negative trade balance of US$12.8 billion. Continue reading
Jan. 5 – The new issue of India Briefing Magazine – titled FDI and Manufacturing Electronics in India – is now available for complimentary download on the Asia Briefing Bookstore.
Two years ago, a conference of the State Industry Ministers put forth the goal to increase the contribution of the manufacturing sector to GDP from 16 percent to 25 percent.
The manufacturing sector’s contribution to India’s GDP is considered low when compared to other Asian economies (where manufacturing contributes closer to between 25 percent and 34 percent of GDP) and is seen as not fulfilling its potential. To remedy this, the recently released National Manufacturing Policy has set clear objectives to harness the sector for economic growth, including an emphasis on FDI and foreign technologies. Continue reading
Jan. 5 – India has permitted overseas individual investors, pension funds, and trusts to directly invest in equities, in an effort to shore up investor confidence and attract money from overseas to bridge the widening current account deficit.
Procedures that enhance capital inflows are high on the government’s agenda as the international downturn led by the Euro Zone Crisis has led to investors pulling money out of Indian equities. For India, the problem has been compounded by a bend in investor confidence because of policy inaction leading to a sharp fall in new projects. Continue reading
Dec. 7 – The value of India’s exports throughout October 2011 were recorded at US$19.87 billion, good for a 10.82 percent increase over the level of US$17.93 billion during October 2010. The increasing value of exports for the period of April-October this fiscal year was US$179.78 billion against US$123.17 billion over the same stage last year, recording growth of 45.96 percent.
India’s monthly imports during October 2011 were recorded at US$39.51 billion, showing a development of 21.72 percent over the level of US$32.46 billion experienced in October last year. The swelling value of imports for the period of April-October this fiscal was US$273.47 billion as against US$208.82 billion over the same period last year, recording an increase of 30.96 percent. Continue reading
Dec. 5 – After depreciating to a record low of 52.73 against the U.S. dollar on November 22, the Indian rupee (INR) rose in value to 51.206 per dollar on Friday to complete the currency’s first weekly advance since October.
The Indian rupee is under great stress as overseas investors are paring their exposure to Asia’s third-largest economy amid international uncertainty and mounting worries over the domestic economy.
On November 21 alone, overseas funds sold more than US$500 million worth of Indian-listed shares over the five trading sessions, reducing net inflows for 2011 to under US$300 million – a tiny sum compared with the record investments of more than US$29 billion experienced in 2010. The rupee has lost more than 10 percent of its value this year, making it one of the worst performing currencies in Asia. Continue reading
Nov. 15 – The main purposes of India’s Industrial Policy of the Government are to maintain a sustained growth in productivity, to enhance gainful employment, to achieve optimal utilization of human resources, to attain international competitiveness, and to transform India into a major partner and player in the global arena.
The Policy focus is on deregulating Indian industry, giving the industry freedom and flexibility in responding to market forces and providing a policy regime that facilitates and fosters growth within the country’s industry. Continue reading
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