Is Economy The Biggest Challenge In Front Of Modi Government?

WION Edit: Jobs: The Achilles heel for Modi government?

The price of milk in <a href="https://www.wionews.com/south-asia/cash-strapped-pakistan-wooes-investors-with-belly-dancers-248426">Pakistan</a> escalated to around Rs 120 to Rs 140 per litre on Tuesday.

While the official price of milk set by the Karachi Commissioner is Rs 94 per litre, the prices swelled in the country owing to the rise in its demand on the occasion of Muharram.

Also read:&nbsp;<a href="https://www.wionews.com/south-asia/pakistan-economic-crisis-countrys-debts-liabilities-exceed-the-size-of-its-gdp-245554">Pakistan economic crisis: Country's debts, liabilities exceed the size of its GDP</a>

According to several media reports, a litre of milk in Karachi and Sindh Province was priced between 120 to Rs 140 per litre.&nbsp;

The price of petrol and diesel in Pakistan is Rs 113 and Rs 91 per litre, respectively.

Pakistan's crippled economy is currently undergoing a tough time.

The annual fiscal deficit of Pakistan rose to the highest in the last three decades at 8.9 per cent for the financial year 2018-19. The fiscal deficit is a difference between the revenues and expenditures of the federal government.

The price of milk in Pakistan escalated to around Rs 120 to Rs 140 per litre on Tuesday. While the official price of milk set by the Karachi Commissioner is Rs 94 per litre, the prices swelled in the country owing to the rise in its demand on the occasion of Muharram.

The price of milk in Pakistan escalated to around Rs 120 to Rs 140 per litre on Tuesday. While the official price of milk set by the Karachi Commissioner is Rs 94 per litre, the prices swelled in the country owing to the rise in its demand on the occasion of Muharram. Also read: Pakistan economic crisis: Country's debts, liabilities exceed the size of its GDP According to several media reports, a litre of milk in Karachi and Sindh Province was priced between 120 to Rs 140 per litre. The price of petrol and diesel in Pakistan is Rs 113 and Rs 91 per litre, respectively. Pakistan's crippled economy is currently undergoing a tough time. The annual fiscal deficit of Pakistan rose to the highest in the last three decades at 8.9 per cent for the financial year 2018-19. The fiscal deficit is a difference between the revenues and expenditures of the federal government.

On Muharram, milk becomes costlier than petrol in Pakistan

Asian markets mostly rose Wednesday with a broadly upbeat tone across trading floors ahead of major meetings at the European and US central banks, while there is also a growing sense of optimism over <a href="https://www.wionews.com/world/china-us-trade-talks-to-restart-after-g20-tariff-truce-239483">China-US trade talks</a>.

News that <a href="https://www.wionews.com/india-news/i-asked-nsa-john-bolton-to-resign-tweets-us-president-donald-trump-248901">Donald Trump</a> had fired his fervently hawkish national security adviser also lifted sentiment with analysts saying it could see the White House take a less strident approach and ease geopolitical tensions.

With the global economy sputtering, attention has turned increasingly to central banks as investors look for more stimulus.

Watch Vidoe:&nbsp;US President Donald Trump fires NSA John Bolton

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On Thursday the European Central Bank holds one of its most anticipated gatherings and hopes are for a series of fresh measures including a possible interest rate cut, fresh bond-buying quantitative easing (QE) or other loosening tools.

That is followed by the Federal Reserve's board meeting next week, where it is tipped to announce another reduction in borrowing costs as the world's top economy which has so far been the strongest globally stutters.

"With the expectation of the resumption of quantitative easing by the ECB&nbsp;and a rate cut by the Federal Reserve next week, the risk environment has solidified and tempted investors out of hiding from the bond markets and back into equities," said Jeffrey Halley, senior market analyst at OANDA.

In the afternoon trade, Hong Kong climbed 1.6 per cent as investors made the most of the upbeat mood to pick up cheap stocks after months of sometimes violent protests in the city weighed on the stock market.

Tokyo finished one per cent higher, Singapore put on more than one per cent, Seoul rose 0.8 per cent, Sydney gained 0.4 per cent and Taipei added 0.3 per cent, while Manila, Mumbai, Bangkok, and Jakarta also posted gains.

However, Shanghai was fell 0.4 per cent, with little major reaction to the news that China had listed 16 US categories of goods it would exempt from tariffs, ahead of planned top-level trade talks next month. Dealers also appeared to brush off Beijing's decision on Tuesday to lift limits on foreign investment in the country.

Wellington tumbled almost two per cent as Prime Minister Jacinda Ardern's government was rocked by its handling of sexual assault allegations against a top Labour Party staffer.

In early trade London rose 0.5 per cent, Frankfurt jumped 0.6 per cent and Paris edged up 0.3 per cent.

Trump's decision to sack John Bolton as a leading security adviser raised the possibility of an easing of tensions between the US and several nations, particularly Iran.

The controversial <a href="https://www.wionews.com/world/us-security-adviser-john-bolton-to-urge-tougher-uk-stance-on-iran-and-china-242307">Bolton</a> was closely linked to the invasion of Iraq and other past aggressive US foreign policy decisions and was seen as one of the main driving forces in Trump's muscular approach to Tehran, North Korea, and Venezuela, among others.

Stephen Innes at AxiTrader said that while the move did not necessarily mean a huge change in policy direction, "it does eliminate the most vocal advocate for US military-enforced regime change in the Trump administration".

He added that "from a geopolitical risk perspective, it does lessen war risk premiums, especially in Syria, Venezuela, and Iran and opens the door to more friendly discussion with North Korea".

However, the possibility of dialling down in the stand-off between the US and Iran led to a plunge Tuesday in the price of oil, with WTI diving almost three per cent from an intraday high and Brent shedding 2.5 per cent.

The two contracts later clawed back some of the losses on bargain-buying expectations for more output cuts by leading producers led by Saudi Arabia.

In share trading companies linked to Apple enjoyed healthy buying after the US tech giant unveiled new iPhones, including a lower-priced offering, and set launch dates for its original video offering as well as its game subscription service.

In Tokyo, Alps Alpine surged three per cent, Japan Display put on nearly three per cent and Sharp rallied more than four per cent, while LG Display in Seoul was up two per cent in Seoul. Taipei-listed Foxconn rose by 0.2 per cent.

On forex markets, the positive vibe helped the dollar up against the safe-haven yen, while higher-yielding, riskier currencies edged up against the greenback.

The pound held its recent gains as Prime Minister Boris Johnson said he was pushing to strike a divorce agreement with the European Union, having lost a series of key votes to MPs opposed to a no-deal Brexit.

Asian markets mostly rose Wednesday with a broadly upbeat tone across trading floors ahead of major meetings at the European and US central banks, while there is also a growing sense of optimism over China-US trade talks.

Asian markets mostly rose Wednesday with a broadly upbeat tone across trading floors ahead of major meetings at the European and US central banks, while there is also a growing sense of optimism over China-US trade talks. News that Donald Trump had fired his fervently hawkish national security adviser also lifted sentiment with analysts saying it could see the White House take a less strident approach and ease geopolitical tensions. With the global economy sputtering, attention has turned increasingly to central banks as investors look for more stimulus. Watch Vidoe: US President Donald Trump fires NSA John Bolton × On Thursday the European Central Bank holds one of its most anticipated gatherings and hopes are for a series of fresh measures including a possible interest rate cut, fresh bond-buying quantitative easing (QE) or other loosening tools. That is followed by the Federal Reserve's board meeting next week, where it is tipped to announce another reduction in borrowing costs as the world's top economy which has so far been the strongest globally stutters. "With the expectation of the resumption of quantitative easing by the ECB and a rate cut by the Federal Reserve next week, the risk environment has solidified and tempted investors out of hiding from the bond markets and back into equities," said Jeffrey Halley, senior market analyst at OANDA. In the afternoon trade, Hong Kong climbed 1.6 per cent as investors made the most of the upbeat mood to pick up cheap stocks after months of sometimes violent protests in the city weighed on the stock market. Tokyo finished one per cent higher, Singapore put on more than one per cent, Seoul rose 0.8 per cent, Sydney gained 0.4 per cent and Taipei added 0.3 per cent, while Manila, Mumbai, Bangkok, and Jakarta also posted gains. However, Shanghai was fell 0.4 per cent, with little major reaction to the news that China had listed 16 US categories of goods it would exempt from tariffs, ahead of planned top-level trade talks next month. Dealers also appeared to brush off Beijing's decision on Tuesday to lift limits on foreign investment in the country. Wellington tumbled almost two per cent as Prime Minister Jacinda Ardern's government was rocked by its handling of sexual assault allegations against a top Labour Party staffer. In early trade London rose 0.5 per cent, Frankfurt jumped 0.6 per cent and Paris edged up 0.3 per cent. Trump's decision to sack John Bolton as a leading security adviser raised the possibility of an easing of tensions between the US and several nations, particularly Iran. The controversial Bolton was closely linked to the invasion of Iraq and other past aggressive US foreign policy decisions and was seen as one of the main driving forces in Trump's muscular approach to Tehran, North Korea, and Venezuela, among others. Stephen Innes at AxiTrader said that while the move did not necessarily mean a huge change in policy direction, "it does eliminate the most vocal advocate for US military-enforced regime change in the Trump administration". He added that "from a geopolitical risk perspective, it does lessen war risk premiums, especially in Syria, Venezuela, and Iran and opens the door to more friendly discussion with North Korea". However, the possibility of dialling down in the stand-off between the US and Iran led to a plunge Tuesday in the price of oil, with WTI diving almost three per cent from an intraday high and Brent shedding 2.5 per cent. The two contracts later clawed back some of the losses on bargain-buying expectations for more output cuts by leading producers led by Saudi Arabia. In share trading companies linked to Apple enjoyed healthy buying after the US tech giant unveiled new iPhones, including a lower-priced offering, and set launch dates for its original video offering as well as its game subscription service. In Tokyo, Alps Alpine surged three per cent, Japan Display put on nearly three per cent and Sharp rallied more than four per cent, while LG Display in Seoul was up two per cent in Seoul. Taipei-listed Foxconn rose by 0.2 per cent. On forex markets, the positive vibe helped the dollar up against the safe-haven yen, while higher-yielding, riskier currencies edged up against the greenback. The pound held its recent gains as Prime Minister Boris Johnson said he was pushing to strike a divorce agreement with the European Union, having lost a series of key votes to MPs opposed to a no-deal Brexit.

Asian markets extend gains over optimism on China-US trade talks

August Automobile Sales Down 23% Across Segments.

Gravitas: Auto Sales Slowdown: Impact On Economy

Former Turkish deputy prime minister Ali Babacan will form a new political party before the end of the year to challenge President Tayyip Erdogan's AK Party, announcing his intentions in a newspaper interview published on Tuesday.

Babacan resigned from the AK Party in July, citing "deep differences". He had been a founding member of the AK Party and served as an economy and foreign minister during its first years in power before becoming deputy prime minister, a role he held from 2009 to 2015.

Babacan told the Karar newspaper that he was still working to find like-minded individuals to forge a team to lead the new party.

"This will take some time," he told the newspaper. "We want the party to be formed before 2020. The quality is very important here,"

Erdogan's AK Party suffered a stinging electoral defeat in Istanbul mayoral elections in June, and a party led by Babacan could further erode Erdogan's support base.

Former Turkish deputy prime minister Ali Babacan will form a new political party before the end of the year to challenge President Tayyip Erdogan's AK Party, announcing his intentions in a newspaper interview published on Tuesday.

Former Turkish deputy prime minister Ali Babacan will form a new political party before the end of the year to challenge President Tayyip Erdogan's AK Party, announcing his intentions in a newspaper interview published on Tuesday. Babacan resigned from the AK Party in July, citing "deep differences". He had been a founding member of the AK Party and served as an economy and foreign minister during its first years in power before becoming deputy prime minister, a role he held from 2009 to 2015. Babacan told the Karar newspaper that he was still working to find like-minded individuals to forge a team to lead the new party. "This will take some time," he told the newspaper. "We want the party to be formed before 2020. The quality is very important here," Erdogan's AK Party suffered a stinging electoral defeat in Istanbul mayoral elections in June, and a party led by Babacan could further erode Erdogan's support base.

Former Erdogan ally to form rival party before year-end: paper

While reviving the economy, when conventional solutions don’t give much traction, one may like to listen to voices from below for a change. Most important advantage of distributed income in the hand of millions will be a different kind of consumption pull compared to the gains in far fewer hands. This is a well-known economic principle. But then the majority of discussants have not cared to look at distributed solutions so far, let me try.

Let the government extend advance to all employees to buy the annual stock of grains, pulses, oil, sugar, spices, and other essentials including clothes and furnishings. Let community self-regulate that this advance is not used for any other purpose. Distributed inventory costs less, spoils less and last longer and helps market liquidate the excess inventory. Let it incentivize private sector to buy e-vehicles, essentials on Diwali or Dussehra, all other durables for homes. Massive infusion of capital with tax incentives for the firms to ensure demand-pull for durables.

Let the experiment triggered by NABARD to supply food at a few railway station be urgently replicated to at least half of the stations to generate huge work for women self-help groups and homely food for the passengers. NABARD can extend the advance to such groups to deal with working capital requirements.

All parties and functions in the country for one year at least may serve two dishes of millets, some snacks/juices/jams from north-east and Jammu and Kashmir, and central India. Let market monitor the misery and alleviate the distress by linking potential demand for various goods/services with untapped supply. LTC (leave travel concession) to tourist sites in aspirational districts with strong tent-based stay facilities (because the durable infrastructure will take time to come about, in Kutch whole microcity was created) may be incentivized. Similarly, CSR investment or co-investments with science, tech and educational innovation initiatives in such regions may be incentivized.

All residential college/school/public hospitals messes may be asked to serve healthy multi-grain food, organic vegetables at least once a week, disclosing the list of suppliers on their websites to let others know about such suppliers.

Every notebook and school text book may have printed information about nutrition, child rights and keeping-oneself -safe for girls and boys. But till then, small booklets and posters may be printed with a weekly or bi-weekly wall-newspapers for each village carrying preventive health, sustainable agri and non-farm enterprise tips, specific for each region or sub-region. It may have space for local block level and even village level advertisers. Idea is to stimulate demand for micro-small producers with limited capacity to produce and serve.

All c-class radio stations may be advised to give at least three hour worth of concessional advertising in popular Vividh Bharati program to local entrepreneurs and service providers. Let there be business centres set up at each petrol station with the help of the association of chartered accountants, company secretaries and other commerce post graduates to provide rural entrepreneurs, young and old to use e-market potential for their sale and purchase.

Let post office network of 1.5 lac rural centres serve 650,000 villages and GIAN and SRISTI are willing to provide logistical and conceptual support for these kinds of galvanising unmet demands and untapped supplies for horizontal markets. Today tens of thousands worth of crores rupees worth of saving of self-help groups is not used to buy each other’s products.

Soon after rains, let there be a massive public program to deepen wells, tanks, dig new wells, tanks on private and public lands, planting trees after rains with Sundaram’s one lit water once technology under MNGREA for preparing the country to ensure trillions of gallons worth of distributed water storage capacity and millions of micro forests. After rains, soils will be soft and easier to dig and with less energy, more work can be done as against doing the same in summer which we have failed to do every year.

(This article was originally published on The DNA. Read the <a href="https://www.dnaindia.com/analysis/report-reviving-indian-economy-some-suggestions-from-below-for-a-change-2788423">original article</a>)

(Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL) 
&nbsp;

While reviving the economy, when conventional solutions don’t give much traction, one may like to listen to voices from below for a change. Most important advantage of distributed income in the hand of millions will be a different kind of consumption pull compared to the gains in far fewer hands.

While reviving the economy, when conventional solutions don’t give much traction, one may like to listen to voices from below for a change. Most important advantage of distributed income in the hand of millions will be a different kind of consumption pull compared to the gains in far fewer hands. This is a well-known economic principle. But then the majority of discussants have not cared to look at distributed solutions so far, let me try. Let the government extend advance to all employees to buy the annual stock of grains, pulses, oil, sugar, spices, and other essentials including clothes and furnishings. Let community self-regulate that this advance is not used for any other purpose. Distributed inventory costs less, spoils less and last longer and helps market liquidate the excess inventory. Let it incentivize private sector to buy e-vehicles, essentials on Diwali or Dussehra, all other durables for homes. Massive infusion of capital with tax incentives for the firms to ensure demand-pull for durables. Let the experiment triggered by NABARD to supply food at a few railway station be urgently replicated to at least half of the stations to generate huge work for women self-help groups and homely food for the passengers. NABARD can extend the advance to such groups to deal with working capital requirements. All parties and functions in the country for one year at least may serve two dishes of millets, some snacks/juices/jams from north-east and Jammu and Kashmir, and central India. Let market monitor the misery and alleviate the distress by linking potential demand for various goods/services with untapped supply. LTC (leave travel concession) to tourist sites in aspirational districts with strong tent-based stay facilities (because the durable infrastructure will take time to come about, in Kutch whole microcity was created) may be incentivized. Similarly, CSR investment or co-investments with science, tech and educational innovation initiatives in such regions may be incentivized. All residential college/school/public hospitals messes may be asked to serve healthy multi-grain food, organic vegetables at least once a week, disclosing the list of suppliers on their websites to let others know about such suppliers. Every notebook and school text book may have printed information about nutrition, child rights and keeping-oneself -safe for girls and boys. But till then, small booklets and posters may be printed with a weekly or bi-weekly wall-newspapers for each village carrying preventive health, sustainable agri and non-farm enterprise tips, specific for each region or sub-region. It may have space for local block level and even village level advertisers. Idea is to stimulate demand for micro-small producers with limited capacity to produce and serve. All c-class radio stations may be advised to give at least three hour worth of concessional advertising in popular Vividh Bharati program to local entrepreneurs and service providers. Let there be business centres set up at each petrol station with the help of the association of chartered accountants, company secretaries and other commerce post graduates to provide rural entrepreneurs, young and old to use e-market potential for their sale and purchase. Let post office network of 1.5 lac rural centres serve 650,000 villages and GIAN and SRISTI are willing to provide logistical and conceptual support for these kinds of galvanising unmet demands and untapped supplies for horizontal markets. Today tens of thousands worth of crores rupees worth of saving of self-help groups is not used to buy each other’s products. Soon after rains, let there be a massive public program to deepen wells, tanks, dig new wells, tanks on private and public lands, planting trees after rains with Sundaram’s one lit water once technology under MNGREA for preparing the country to ensure trillions of gallons worth of distributed water storage capacity and millions of micro forests. After rains, soils will be soft and easier to dig and with less energy, more work can be done as against doing the same in summer which we have failed to do every year. (This article was originally published on The DNA. Read the original article) (Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL)

Reviving Indian economy: Some suggestions from below for a change

Belly dance performances in the event to promote Pakistan economy.

Pakistan's 'Belly Dance formula' to revive economy

China's central bank said on Friday it was cutting the amount of <a href="https://www.wionews.com/world/us-china-trade-war-to-knock-05-points-off-global-growth-french-finance-minister-247859">cash that banks must</a> hold as reserves for the third time this year, releasing $126.35 billion&nbsp;in liquidity to shore up the flagging economy.

Analysts had expected China to announce more policy easing measures soon as the world's second-largest economy comes under growing pressure from escalating US&nbsp;tariffs and sluggish domestic demand.

The People's Bank of China (PBOC) said it would cut the reserve requirement ratio (RRR) by 50 basis points (bps) for all banks, with an additional 100 bps cut for qualified city commercial banks. The RRR for large banks will be lowered to 13.0 per cent.

The PBOC has now slashed the ratio seven times since early 2018. The size of the latest move was at the upper end of market expectations, and the number of funds released will be the largest so far in the current easing cycle.

The broad-based cut, which will release 800 billion yuan in liquidity, is effective September&nbsp;16. The additional targeted cut will release 100 billion yuan, in two phases effective October 15 and November 15.

"The move shows policymakers are increasingly worried but it’s far from enough to stabilise the economy," said Larry Hu, head of Greater China economics at Macquarie Group in Hong Kong.

"The key constraint is that everything is slowing down corporates are not willing to invest because of the trade war, a global slowdown, and weak infrastructure and property sector growth."

The latest move to spur bank lending followed a cabinet meeting on September 4 that pledged to implement both broad and targeted cuts in the RRR "in a timely manner".

The PBOC said it will maintain a prudent monetary policy and avoid a flood-like stimulus while increasing counter-cyclical adjustments and maintaining reasonable and abundant liquidity.

Analysts say China's economic growth has likely cooled further this quarter from a near 30-year low of 6.2 per cent in April-June. Morgan Stanley says it is now tracking the lower end of the government's full-year target range of around 6-6.5 per cent. 
&nbsp; 
With Washington imposing new tariffs from September 1 and threatening more measures from October 1 and December 15, some economists have recently cut their China growth estimates for next year to below 6 per cent, which would breach Beijing's longer-term development goal.

The central bank is also widely expected to cut one or more of its key policy interest rates in mid-September for the first time in four years as it works to reduce corporate funding costs.

"I think it's very likely they will cut the LPR (loan prime rate) by about 5-10 bps later this month. I also expect another RRR cut of 50 bps by the end of this year,” Macquarie's Hu said.

Despite a slew of support measures and policy easing since last year, China's economy is still struggling to get back on a firm footing.

July's data showed growth stumbled more sharply than expected as the intensifying trade war with the United States took a heavier toll, and August factory surveys pointed to continued weakness.

Prior to the latest RRR cut, the central bank had pumped out 3.63 trillion yuan in net liquidity through reserve cuts since early 2018, according to Reuters calculations based on PBOC data and analyst estimates.

The PBOC's hefty injections have helped bring down companies' borrowing costs, which had jumped early last year as regulators clamped down on riskier types of financing and debt.

But analysts have cautioned that some companies may be merely refinancing existing debt at better rates, rather than borrowing to fund fresh investments.

Analysts say the problem is not a lack of credit the PBOC has injected generous amounts of liquidity but weakening business and consumer confidence as the trade war drag on. That has weighed on activity from manufacturing and investment to retail sales.

In the latest escalation in the protracted trade dispute, the United States began imposing 15 per cent&nbsp;tariffs on a variety of Chinese goods on September&nbsp;1&nbsp;including footwear, smartwatches, and flat-panel televisions and China began imposing new duties on US crude.

The next high-level trade talks are slated for early October, but a lasting peace seems more elusive than ever.

The government has repeatedly said it will not resort to "flood-like" stimulus as it did in past economic downturns, which left a mountain of debt and sparked fears of property market bubbles.

Instead, Beijing has relied more on fiscal stimuli such as increased infrastructure spending and tax cuts, though the boost has been milder than expected so far.

The cabinet said on Wednesday China will allow local governments to issue special-purpose bonds earlier than normal next year to help steady growth, and specified for the first time that about 20 per cent&nbsp;of all special purpose bonds issued by every province could be used as project capital.

Many local governments are facing increasing fiscal strains as tax cuts and the broader economic slowdown reduce revenues, hampering their ability to implement infrastructure projects.

The OECD has estimated that China's fiscal stimulus was equivalent to 4.25 per cent of gross domestic product (GDP) in 2019, up from 2.94 per cent last year.

China's central bank said on Friday it was cutting the amount of cash that banks must hold as reserves for the third time this year, releasing $126.35 billion in liquidity to shore up the flagging economy.

China's central bank said on Friday it was cutting the amount of cash that banks must hold as reserves for the third time this year, releasing $126.35 billion in liquidity to shore up the flagging economy. Analysts had expected China to announce more policy easing measures soon as the world's second-largest economy comes under growing pressure from escalating US tariffs and sluggish domestic demand. The People's Bank of China (PBOC) said it would cut the reserve requirement ratio (RRR) by 50 basis points (bps) for all banks, with an additional 100 bps cut for qualified city commercial banks. The RRR for large banks will be lowered to 13.0 per cent. The PBOC has now slashed the ratio seven times since early 2018. The size of the latest move was at the upper end of market expectations, and the number of funds released will be the largest so far in the current easing cycle. The broad-based cut, which will release 800 billion yuan in liquidity, is effective September 16. The additional targeted cut will release 100 billion yuan, in two phases effective October 15 and November 15. "The move shows policymakers are increasingly worried but it’s far from enough to stabilise the economy," said Larry Hu, head of Greater China economics at Macquarie Group in Hong Kong. "The key constraint is that everything is slowing down corporates are not willing to invest because of the trade war, a global slowdown, and weak infrastructure and property sector growth." The latest move to spur bank lending followed a cabinet meeting on September 4 that pledged to implement both broad and targeted cuts in the RRR "in a timely manner". The PBOC said it will maintain a prudent monetary policy and avoid a flood-like stimulus while increasing counter-cyclical adjustments and maintaining reasonable and abundant liquidity. Analysts say China's economic growth has likely cooled further this quarter from a near 30-year low of 6.2 per cent in April-June. Morgan Stanley says it is now tracking the lower end of the government's full-year target range of around 6-6.5 per cent. With Washington imposing new tariffs from September 1 and threatening more measures from October 1 and December 15, some economists have recently cut their China growth estimates for next year to below 6 per cent, which would breach Beijing's longer-term development goal. The central bank is also widely expected to cut one or more of its key policy interest rates in mid-September for the first time in four years as it works to reduce corporate funding costs. "I think it's very likely they will cut the LPR (loan prime rate) by about 5-10 bps later this month. I also expect another RRR cut of 50 bps by the end of this year,” Macquarie's Hu said. Despite a slew of support measures and policy easing since last year, China's economy is still struggling to get back on a firm footing. July's data showed growth stumbled more sharply than expected as the intensifying trade war with the United States took a heavier toll, and August factory surveys pointed to continued weakness. Prior to the latest RRR cut, the central bank had pumped out 3.63 trillion yuan in net liquidity through reserve cuts since early 2018, according to Reuters calculations based on PBOC data and analyst estimates. The PBOC's hefty injections have helped bring down companies' borrowing costs, which had jumped early last year as regulators clamped down on riskier types of financing and debt. But analysts have cautioned that some companies may be merely refinancing existing debt at better rates, rather than borrowing to fund fresh investments. Analysts say the problem is not a lack of credit the PBOC has injected generous amounts of liquidity but weakening business and consumer confidence as the trade war drag on. That has weighed on activity from manufacturing and investment to retail sales. In the latest escalation in the protracted trade dispute, the United States began imposing 15 per cent tariffs on a variety of Chinese goods on September 1 including footwear, smartwatches, and flat-panel televisions and China began imposing new duties on US crude. The next high-level trade talks are slated for early October, but a lasting peace seems more elusive than ever. The government has repeatedly said it will not resort to "flood-like" stimulus as it did in past economic downturns, which left a mountain of debt and sparked fears of property market bubbles. Instead, Beijing has relied more on fiscal stimuli such as increased infrastructure spending and tax cuts, though the boost has been milder than expected so far. The cabinet said on Wednesday China will allow local governments to issue special-purpose bonds earlier than normal next year to help steady growth, and specified for the first time that about 20 per cent of all special purpose bonds issued by every province could be used as project capital. Many local governments are facing increasing fiscal strains as tax cuts and the broader economic slowdown reduce revenues, hampering their ability to implement infrastructure projects. The OECD has estimated that China's fiscal stimulus was equivalent to 4.25 per cent of gross domestic product (GDP) in 2019, up from 2.94 per cent last year.

China cuts banks' reserve ratios, frees up $126 billion for loans as economy slows

Slowdown hits the world's largest economy. U.S GDP Growth falls to 2% Estimated was 2.1%

WION Wallet: U.S GDP Growth falls to 2% Estimated was 2.1%

Argentine bond prices fell on Thursday (August 29) and country risk soared to levels not seen since 2005 after the government announced plans to extend maturities on about $100 billion in debt, raising fear of a full-blown financial crisis.

Argentine bond prices fall, country risk soars on debt 'reprofiling' plan

The fast development of the Guangdong-Hong Kong-Macao Greater Bay Area attracts young people from Hong Kong and Macao to set up businesses and realize their dreams.

Greater Bay Area provides golden opportunities for young people in HK, Macao

Union Home Minister Amit Shah on Wednesday said that the aim of making India a 5 trillion dollar economy would only be achieved if country's national security remains intact.

"Prime Minister Narendra Modi wants to make 5 trillion economy. For this, the security of the country is very important. There is a need to maintain internal and external security of the country," he said while addressing the 49th foundation day celebrations of BPR&amp;D in New Delhi.

He continued, "More than 34 thousand police personnel have sacrificed their lives for maintaining internal security, Now it is important to move forward."

Speaking about police reforms, he said, "We need to bring reforms in the police force in accordance with the changing challenges. But police reform is a huge concept and therefore it needs to be redesigned by the BPR&amp;D."

"A consultation process must also start across the country for making necessary changes within the CrPC and IPC. Everyone must send their suggestions to the Home Ministry. We need to move forward in bringing changes in CrPc and IPC," he added.

He also stressed upon promoting Forensic Science universities and colleges so that culprits can be booked expeditiously.

"This will help us to provide speedy justice to victims and will also reduce the mindset of committing crimes among masses," he added.

In his concluding remark, Shah stressed that the forces must adopt scientific methods for investigations and modernisation should be carried out in a proper manner.&nbsp;

Union Home Minister Amit Shah on Wednesday said that the aim of making India a 5 trillion dollar economy would only be achieved if country's national security remains intact.

Union Home Minister Amit Shah on Wednesday said that the aim of making India a 5 trillion dollar economy would only be achieved if country's national security remains intact. "Prime Minister Narendra Modi wants to make 5 trillion economy. For this, the security of the country is very important. There is a need to maintain internal and external security of the country," he said while addressing the 49th foundation day celebrations of BPR&D in New Delhi. He continued, "More than 34 thousand police personnel have sacrificed their lives for maintaining internal security, Now it is important to move forward." Speaking about police reforms, he said, "We need to bring reforms in the police force in accordance with the changing challenges. But police reform is a huge concept and therefore it needs to be redesigned by the BPR&D." "A consultation process must also start across the country for making necessary changes within the CrPC and IPC. Everyone must send their suggestions to the Home Ministry. We need to move forward in bringing changes in CrPc and IPC," he added. He also stressed upon promoting Forensic Science universities and colleges so that culprits can be booked expeditiously. "This will help us to provide speedy justice to victims and will also reduce the mindset of committing crimes among masses," he added. In his concluding remark, Shah stressed that the forces must adopt scientific methods for investigations and modernisation should be carried out in a proper manner.

National security important to make India $5-trillion economy: Amit Shah

A report by the State Bank of Pakistan has thrown up some very worrying numbers for the <a href="https://www.wionews.com/south-asia/selected-government-of-pakistan-should-be-worried-about-economy-reham-khan-243992">Imran khan government</a>.&nbsp;

It's been a year since Imran Khan stormed to power promising 'Naya Pakistan'.

But the economy continues to remain in doldrums, and according to experts, it is only getting worse.

In the latest report by the State Bank of Pakistan, for the first time in twenty years, the total debt and liabilities of <a href="https://www.wionews.com/south-asia/pakistan-supreme-court-orders-action-against-judge-in-nawaz-sharifs-case-245144">Pakistan</a> have exceeded the size of its economy.

Pakistan's debt and liability have peaked to a record of 40.2 trillion Pakistani rupees, which is the equivalent of $ 256 billion.

This is a sharp increase of over 34% in just the last 1 year that Imran khan has been in charge.

Watch: No economic turnaround under Imran Khan government

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At the time when Imran khan had taken charge, the total debt and liabilities of Pakistan hovered around 30 trillion Pakistani rupees, which was roughly $191 billion.

The last time, when the Pakistani economy was in such dire straits was in the year 2000.

In the month of march earlier in the year, Imran Khan had stated that he would like to reduce the total debt and liabilities from 30 trillion Pakistani rupees to 20 million Pakistani rupees. But exactly, the opposite of this has happened.

Due to the China–Pakistan Economic Corridor&nbsp;(CPEC) project, and increasing investments by china, Pakistan has been in the grip of a debt crisis for almost over a decade.&nbsp;

All through his campaigning, Imran khan had trained his guns on Nawaz Sharif and the PML(N) for getting Pakistan into the debt trap.&nbsp;

Imran Khan made all the right noises and started his tenure by auctioning off fancy government cars and buffaloes as an austerity measure

he also has made regular visits to Saudi Arabia, United Arab Emirates, china etc to get investments into his country.

Saudi Arabia has promised $20 billion, the United Arab Emirates has promised $6.2 billion, while Malaysia has promised $900 million of investments into Pakistan.

But none of this has made any improvements into the dwindling finances of Pakistan.

To stress on his point, Imran khan has today tweeted a video of the Nathia Gali rest house which he claims was earlier a symbol of colonialism, which cost the Pakistani exchequer crores of rupees to maintain, has now been turned into a source of income for the people of Pakistan. It has now been turned into a hotel.

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نوآبادیات کی یہ نشانیاں جن کی دیکھ بھال کیلئے ٹیکس کے پیسوں سے سالانہ کروڑوں کے اخراجات اٹھتے، اب حکومت کیلئے آمدن کا ذریعہ بنیں گے۔ <a href="https://t.co/BYR2DqJdVv">pic.twitter.com/BYR2DqJdVv</a>
— Imran Khan (@ImranKhanPTI) <a href="https://twitter.com/ImranKhanPTI/status/1165538010345168898?ref_src=twsrc%5Etfw">August 25, 2019</a></blockquote>
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Imran Khan's tenure has been high on rhetoric, and catchy slogans such as 'Naya Pakistan'. But on the ground for the common people, there has been no economic turnaround. Galloping inflation of essential food items has hit the common man pretty hard.

On the international front, Pakistan has accepted another bailout package of $ 6 billion from the IMF on terms which demand more austerity.&nbsp;

While the FATF in its plenary session in October will be meeting to decide if Pakistan should be downgraded to the blacklist.

A report by the State Bank of Pakistan has thrown up some very worrying numbers for the Imran khan government. It's been a year since Imran Khan stormed to power promising 'Naya Pakistan'.

A report by the State Bank of Pakistan has thrown up some very worrying numbers for the Imran khan government. It's been a year since Imran Khan stormed to power promising 'Naya Pakistan'. But the economy continues to remain in doldrums, and according to experts, it is only getting worse. In the latest report by the State Bank of Pakistan, for the first time in twenty years, the total debt and liabilities of Pakistan have exceeded the size of its economy. Pakistan's debt and liability have peaked to a record of 40.2 trillion Pakistani rupees, which is the equivalent of $ 256 billion. This is a sharp increase of over 34% in just the last 1 year that Imran khan has been in charge. Watch: No economic turnaround under Imran Khan government × At the time when Imran khan had taken charge, the total debt and liabilities of Pakistan hovered around 30 trillion Pakistani rupees, which was roughly $191 billion. The last time, when the Pakistani economy was in such dire straits was in the year 2000. In the month of march earlier in the year, Imran Khan had stated that he would like to reduce the total debt and liabilities from 30 trillion Pakistani rupees to 20 million Pakistani rupees. But exactly, the opposite of this has happened. Due to the China–Pakistan Economic Corridor (CPEC) project, and increasing investments by china, Pakistan has been in the grip of a debt crisis for almost over a decade. All through his campaigning, Imran khan had trained his guns on Nawaz Sharif and the PML(N) for getting Pakistan into the debt trap. Imran Khan made all the right noises and started his tenure by auctioning off fancy government cars and buffaloes as an austerity measure he also has made regular visits to Saudi Arabia, United Arab Emirates, china etc to get investments into his country. Saudi Arabia has promised $20 billion, the United Arab Emirates has promised $6.2 billion, while Malaysia has promised $900 million of investments into Pakistan. But none of this has made any improvements into the dwindling finances of Pakistan. To stress on his point, Imran khan has today tweeted a video of the Nathia Gali rest house which he claims was earlier a symbol of colonialism, which cost the Pakistani exchequer crores of rupees to maintain, has now been turned into a source of income for the people of Pakistan. It has now been turned into a hotel. نوآبادیات کی یہ نشانیاں جن کی دیکھ بھال کیلئے ٹیکس کے پیسوں سے سالانہ کروڑوں کے اخراجات اٹھتے، اب حکومت کیلئے آمدن کا ذریعہ بنیں گے۔ pic.twitter.com/BYR2DqJdVv — Imran Khan (@ImranKhanPTI) August 25, 2019 × Imran Khan's tenure has been high on rhetoric, and catchy slogans such as 'Naya Pakistan'. But on the ground for the common people, there has been no economic turnaround. Galloping inflation of essential food items has hit the common man pretty hard. On the international front, Pakistan has accepted another bailout package of $ 6 billion from the IMF on terms which demand more austerity. While the FATF in its plenary session in October will be meeting to decide if Pakistan should be downgraded to the blacklist.

Pakistan economic crisis: Country's debts, liabilities exceed the size of its GDP

On Friday, amid rumblings from the business community and fear over economic growth, Finance Minister Nirmala Sitharaman announced a slew of measures to give a shot in the arm to a lagging economy.

WION Dispatch: Finance Minister Nirmala Sitharaman's roadmap for economy

Sri Lanka's central bank cut its main lending rate Friday for the second time in three months hoping to lift the economy as its struggles in the wake of the devastating Easter attacks that hit the key tourism sector.

The Central Bank of Sri Lanka (CBSL) said the rate at which it lent to commercial banks was reduced by 50 basis points to 8.0 per cent.

It added that the 50-basis-point cut in May had not translated into cheaper credit for consumers and expected the latest move to reflect in market lending rates.

"It is essential that market lending rates are lowered by bank and non-bank financial institutions in response to their reduced cost of funds, thereby boosting credit flows to productive sectors, and in turn help the revival of the economy," the bank said in its monthly economic review.

Sri Lanka's economic growth slowed to 3.2 per cent last year from 3.4 per cent in 2018, but had been expected to pick up in 2019 until the devastating attacks by a homegrown jihadist group that killed hundreds and hammered tourism and consumer spending.

"Although economic growth is expected to recover gradually towards its potential in the medium term, domestic and global headwinds are likely to delay this recovery," the bank said.

Finance Minister Mangala Samaraweera expected revenues from tourism -- one of the country's biggest income earners -- to plunge $1.5 billion this year because of cancellations by foreign tourists after the bombings, but the industry expects a faster recovery.

The government allowed a state of emergency to lapse on Thursday as authorities announced they had arrested or killed those directly responsible for the attacks.

The International Monetary Fund released a delayed loan instalment to Sri Lanka following the bombings, helping government efforts to stabilise the economy.

The global lender released $164 million under a three-year $1.5 billion bailout that was suspended in October during a power struggle between the president and the prime minister.&nbsp;

Sri Lanka's central bank cut its main lending rate Friday for the second time in three months hoping to lift the economy as its struggles in the wake of the devastating Easter attacks that hit the key tourism sector.

Sri Lanka's central bank cut its main lending rate Friday for the second time in three months hoping to lift the economy as its struggles in the wake of the devastating Easter attacks that hit the key tourism sector. The Central Bank of Sri Lanka (CBSL) said the rate at which it lent to commercial banks was reduced by 50 basis points to 8.0 per cent. It added that the 50-basis-point cut in May had not translated into cheaper credit for consumers and expected the latest move to reflect in market lending rates. "It is essential that market lending rates are lowered by bank and non-bank financial institutions in response to their reduced cost of funds, thereby boosting credit flows to productive sectors, and in turn help the revival of the economy," the bank said in its monthly economic review. Sri Lanka's economic growth slowed to 3.2 per cent last year from 3.4 per cent in 2018, but had been expected to pick up in 2019 until the devastating attacks by a homegrown jihadist group that killed hundreds and hammered tourism and consumer spending. "Although economic growth is expected to recover gradually towards its potential in the medium term, domestic and global headwinds are likely to delay this recovery," the bank said. Finance Minister Mangala Samaraweera expected revenues from tourism -- one of the country's biggest income earners -- to plunge $1.5 billion this year because of cancellations by foreign tourists after the bombings, but the industry expects a faster recovery. The government allowed a state of emergency to lapse on Thursday as authorities announced they had arrested or killed those directly responsible for the attacks. The International Monetary Fund released a delayed loan instalment to Sri Lanka following the bombings, helping government efforts to stabilise the economy. The global lender released $164 million under a three-year $1.5 billion bailout that was suspended in October during a power struggle between the president and the prime minister.

Sri Lanka cuts rates as economy struggles after Easter attacks

Fixing India's weak growth has become the highest priority while a benign inflation outlook has given the central bank room to cut rates although transmission remains inadequate, monetary policy committee meeting minutes showed.

The Reserve Bank of India (RBI) lowered its benchmark interest rates for a fourth straight meeting this month with a slightly bigger than expected cut, underscoring its worries about the near-five year low economic growth pace.

The six-member monetary policy committee (MPC) cut the repo rate by an unconventional 35 basis points (bps) to 5.40 per cent.

"Given the current and evolving inflation and growth scenario at this juncture, it can no longer be business as usual approach. The economy needs a larger push," Governor Shaktikanta Das said in the minutes, released on Wednesday.

Annual retail inflation in July was 3.15 per cent, down from an eight-month high of 3.18 per cent in June and staying below the central bank's 4 per&nbsp;medium-term target for a 12th straight month, raising expectations for a cut in October.

Last week, a Reuters poll predicted the RBI would ease its benchmark rate by 25 basis points again to 5.15 per cent&nbsp;at its October meeting, followed by a 15 basis point cut in the first quarter of 2020.

Since February, the RBI has cut the repo rate by a total 110 basis points (bps), but most Indian banks have not come close to the following suit.

"Under prevailing circumstances, the immediate transmission should be considered not so much in terms of the bank deposit and lending rates but more specific rates influencing new investments such as housing loans, vehicle loans and long term bonds," said one MPC member, Ravindra Dholakia.

Most members of the committee, however, felt rate transmission would be faster in the coming weeks and months aided by surplus liquidity in the banking system.

The RBI is also looking to get banks to link some new loans to its key policy rate or other external benchmarks, Das said on Monday, as he pushes them to cut rates faster to stimulate growth.

"While they are giving stylised arguments to justify their recommendations, none of them has made a clear statement on the outlook or possible timelines for recovery," said Rupa Rege Nitsure, chief economist at L&amp;T Financial Holdings.

"A lot depends on how promptly fiscal authorities undertake remedial measures."

Finance Minister Nirmala Sitharaman has recently held several meetings with industry leaders, who have called for stimulus measures, including tax rebates, to support consumer demand and private investment.

Pami Dua, another member of the MPC, said while monetary policy can impact cyclical factors, it has its limits when the slowdown is structural in nature.

"Therefore, investment-focused fiscal policy and the active continuation of structural reforms are imperative at this juncture," Dua said.

The government was looking into policy issues such as exempting foreign portfolio investor trusts from recently imposed high tax, deferring a proposal to raise minimum public shareholding in listed companies to 35 per cent from 25 per cent and easing of banking credit, a source told Reuters on Friday.

"Given the evolving growth-inflation risk picture, monetary policy should be used judiciously," member Chetan Ghate said.

Fixing India's weak growth has become the highest priority while a benign inflation outlook has given the central bank room to cut rates although transmission remains inadequate, monetary policy committee meeting minutes showed.

Fixing India's weak growth has become the highest priority while a benign inflation outlook has given the central bank room to cut rates although transmission remains inadequate, monetary policy committee meeting minutes showed. The Reserve Bank of India (RBI) lowered its benchmark interest rates for a fourth straight meeting this month with a slightly bigger than expected cut, underscoring its worries about the near-five year low economic growth pace. The six-member monetary policy committee (MPC) cut the repo rate by an unconventional 35 basis points (bps) to 5.40 per cent. "Given the current and evolving inflation and growth scenario at this juncture, it can no longer be business as usual approach. The economy needs a larger push," Governor Shaktikanta Das said in the minutes, released on Wednesday. Annual retail inflation in July was 3.15 per cent, down from an eight-month high of 3.18 per cent in June and staying below the central bank's 4 per medium-term target for a 12th straight month, raising expectations for a cut in October. Last week, a Reuters poll predicted the RBI would ease its benchmark rate by 25 basis points again to 5.15 per cent at its October meeting, followed by a 15 basis point cut in the first quarter of 2020. Since February, the RBI has cut the repo rate by a total 110 basis points (bps), but most Indian banks have not come close to the following suit. "Under prevailing circumstances, the immediate transmission should be considered not so much in terms of the bank deposit and lending rates but more specific rates influencing new investments such as housing loans, vehicle loans and long term bonds," said one MPC member, Ravindra Dholakia. Most members of the committee, however, felt rate transmission would be faster in the coming weeks and months aided by surplus liquidity in the banking system. The RBI is also looking to get banks to link some new loans to its key policy rate or other external benchmarks, Das said on Monday, as he pushes them to cut rates faster to stimulate growth. "While they are giving stylised arguments to justify their recommendations, none of them has made a clear statement on the outlook or possible timelines for recovery," said Rupa Rege Nitsure, chief economist at L&T Financial Holdings. "A lot depends on how promptly fiscal authorities undertake remedial measures." Finance Minister Nirmala Sitharaman has recently held several meetings with industry leaders, who have called for stimulus measures, including tax rebates, to support consumer demand and private investment. Pami Dua, another member of the MPC, said while monetary policy can impact cyclical factors, it has its limits when the slowdown is structural in nature. "Therefore, investment-focused fiscal policy and the active continuation of structural reforms are imperative at this juncture," Dua said. The government was looking into policy issues such as exempting foreign portfolio investor trusts from recently imposed high tax, deferring a proposal to raise minimum public shareholding in listed companies to 35 per cent from 25 per cent and easing of banking credit, a source told Reuters on Friday. "Given the evolving growth-inflation risk picture, monetary policy should be used judiciously," member Chetan Ghate said.

Fixing weak growth is highest priority: RBI policy minutes

The RBI on August 7, 2019, reduced the repo rate by 35 bps from 5.75 per cent to 5.40 per cent. This is the fourth consecutive cut in a row this year. It also tempered the GDP growth estimates to 6.9 per cent in line with CRISIL.

While the rate cut is 10 bps more than street estimates, it highlights that the central bank recognises the severity of the current slowdown. Including this rate cut, RBI has reduced repo rate (the rate at which it lends to banks) by 110 bps this year (1.10 per cent), and it is at its lowest level in the last nine years.

The RBI governor in a press briefing expressed confidence that this cut would give a boost to investment, consumption and growth. While decline in rate cuts are likely to reduce EMIs for individuals and cost of borrowing for corporates, it alone is not likely to spur growth.

Firstly, the banks do not pass on the full benefits of rate cuts to consumers. Out of the 75-bps rate cut before the August announcement, banks have passed on only 29 bps benefit to end consumers, less than 40 per cent.

Generally, it takes two to three months for transmission, some could argue. Even by this logic, banks have passed on only 60 per cent&nbsp;benefit. Private banks have been laggards compared to public sector banks. Also, lenders generally pass on more benefits on new loans rather than existing ones.

Just because the EMIs have come down, people would not be tempted to invest in two-wheelers, cars and real estate as consumption depends a lot on sentiment. Consumer confidence declined in July 2019 due to deterioration in sentiments on jobs, price levels and the general economic situation, according to RBI’s own survey.

For the first time in the last decade, FMCG companies are witnessing a decline in their volumes, 5.5 per cent in Q1 FY20 versus 12 per cent in Q1 FY19, according to a Prabhudas Liladhar report. Rural demand has been badly hit due to low farm incomes and wage growth.

The real estate sector is sitting on an all-time high inventory of 12.76 lakh houses in the top 30 cities. The entire auto industry is witnessing a slowdown as never before. Maruti Suzuki reported its sixth consecutive monthly sales decline with numbers falling 33 per cent in July 2019 while TVS Motors reported a decline of 13 per cent.

Maruti for the sixth month in a row has announced production cuts of 25 per cent. As per reports, 2.3 lakh workers have been laid off. This has had a knock-on effect on OEM and auto ancillary sectors, which employ significant number of contractual workers.

Since auto and real estate sectors contribute 15 per cent-17 per cent to India’s GDP, their slowdown has had a direct impact on other sectors like metals and mining, cement and tyre manufacturing, among others.&nbsp;

The manufacturing industry is operating at a capacity utilisation of 75 per cent. Growth in eight core sectors fell to four-year low of 0.2 per cent in June 2019.&nbsp;

Until and unless the manufacturing industry sees a permanent revival in demand and reduction in idle capacity utilisations, it may not think of fresh investments.

Banks, on the other hand, are still reeling from high NPAs. The delay in IBC insolvency cases is hurting the banks, which continue to adopt a selective and cautious approach to lending. Even the retail portfolio of banks is showing signs of stress. The liquidity crunch, post the IL&amp;FS default and the NBFC crisis has not helped matters.

The Indian economy is facing an acute demand side issue and RBI cannot fix it alone. The government missed the opportunity to leave more money in the hands of people through tax cuts in Budget 2019. Instead, the finance minister increased taxes on the super-rich, which has acted as a dampener.

Since tight fiscal math prevents the government from increasing its spending, like it did, post the global financial crisis, India will need to fall back on private consumption expenditure to boost demand and growth. The new Direct Tax Code, which is expected to propose sweeping changes in tax rates should be implemented next year without fail. Till then, all eyes on the festive season! 
 
(This article was originally published on The DNA. Read the <a href="https://www.dnaindia.com/analysis/column-are-the-rate-cuts-enough-to-boost-growth-2782948">original article</a>)

(Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL.)&nbsp;

The RBI on August 7, 2019, reduced the repo rate by 35 bps from 5.75 per cent to 5.40 per cent. This is the fourth consecutive cut in a row this year. It also tempered the GDP growth estimates to 6.

The RBI on August 7, 2019, reduced the repo rate by 35 bps from 5.75 per cent to 5.40 per cent. This is the fourth consecutive cut in a row this year. It also tempered the GDP growth estimates to 6.9 per cent in line with CRISIL. While the rate cut is 10 bps more than street estimates, it highlights that the central bank recognises the severity of the current slowdown. Including this rate cut, RBI has reduced repo rate (the rate at which it lends to banks) by 110 bps this year (1.10 per cent), and it is at its lowest level in the last nine years. The RBI governor in a press briefing expressed confidence that this cut would give a boost to investment, consumption and growth. While decline in rate cuts are likely to reduce EMIs for individuals and cost of borrowing for corporates, it alone is not likely to spur growth. Firstly, the banks do not pass on the full benefits of rate cuts to consumers. Out of the 75-bps rate cut before the August announcement, banks have passed on only 29 bps benefit to end consumers, less than 40 per cent. Generally, it takes two to three months for transmission, some could argue. Even by this logic, banks have passed on only 60 per cent benefit. Private banks have been laggards compared to public sector banks. Also, lenders generally pass on more benefits on new loans rather than existing ones. Just because the EMIs have come down, people would not be tempted to invest in two-wheelers, cars and real estate as consumption depends a lot on sentiment. Consumer confidence declined in July 2019 due to deterioration in sentiments on jobs, price levels and the general economic situation, according to RBI’s own survey. For the first time in the last decade, FMCG companies are witnessing a decline in their volumes, 5.5 per cent in Q1 FY20 versus 12 per cent in Q1 FY19, according to a Prabhudas Liladhar report. Rural demand has been badly hit due to low farm incomes and wage growth. The real estate sector is sitting on an all-time high inventory of 12.76 lakh houses in the top 30 cities. The entire auto industry is witnessing a slowdown as never before. Maruti Suzuki reported its sixth consecutive monthly sales decline with numbers falling 33 per cent in July 2019 while TVS Motors reported a decline of 13 per cent. Maruti for the sixth month in a row has announced production cuts of 25 per cent. As per reports, 2.3 lakh workers have been laid off. This has had a knock-on effect on OEM and auto ancillary sectors, which employ significant number of contractual workers. Since auto and real estate sectors contribute 15 per cent-17 per cent to India’s GDP, their slowdown has had a direct impact on other sectors like metals and mining, cement and tyre manufacturing, among others. The manufacturing industry is operating at a capacity utilisation of 75 per cent. Growth in eight core sectors fell to four-year low of 0.2 per cent in June 2019. Until and unless the manufacturing industry sees a permanent revival in demand and reduction in idle capacity utilisations, it may not think of fresh investments. Banks, on the other hand, are still reeling from high NPAs. The delay in IBC insolvency cases is hurting the banks, which continue to adopt a selective and cautious approach to lending. Even the retail portfolio of banks is showing signs of stress. The liquidity crunch, post the IL&FS default and the NBFC crisis has not helped matters. The Indian economy is facing an acute demand side issue and RBI cannot fix it alone. The government missed the opportunity to leave more money in the hands of people through tax cuts in Budget 2019. Instead, the finance minister increased taxes on the super-rich, which has acted as a dampener. Since tight fiscal math prevents the government from increasing its spending, like it did, post the global financial crisis, India will need to fall back on private consumption expenditure to boost demand and growth. The new Direct Tax Code, which is expected to propose sweeping changes in tax rates should be implemented next year without fail. Till then, all eyes on the festive season! (This article was originally published on The DNA. Read the original article) (Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL.)

Are the rate cuts enough to boost growth?

Imran Khan has completed one year of being Prime Minister of Pakistan. See how was Pakistan's economy changed under Imran Khan. Price of bread is up by 25% in the last year. You can imagine it all by yourself now. Watch this video to know more.

Has Imran Khan delivered 'Naya Pakistan'?

The German economy could have continued to shrink over the summer as industrial production drops amid a dearth of orders, the Bundesbank said on Monday, suggesting that the <a href="https://www.wionews.com/business-economy/global-markets-yen-and-bond-bulls-charge-on-as-share-markets-falter-242412">euro zone's biggest economy is now in a recession</a>.

German growth contracted in the second quarter on slumping exports as a global trade war, China's slowdown and Brexit uncertainty sapped confidence, dealing a blow to an export-focused economy.

"Overall economic performance could again decline slightly," the Bundesbank said in a monthly report.

"The main reason for this is the continuing downturn in the industry," the central bank said, pointing to a significant decline in orders and a big drop in sentiment indicators for manufacturing firms.

While domestic consumption continues to isolate the economy, the jobs market is already showing signs of weakness and confidence in the services sector is also dropping, the Bundesbank added.

Still, the construction boom is likely to continue, providing some support.

While Germany has so far rejected the idea of boosting public spending to offset the slowdown, Finance Minister Olaf Scholz said that Berlin has the financial strength to counter any future economic crisis "with full force".

Speaking on Sunday, Scholz said the global financial crisis in 2008/2009 had cost Germany roughly 50 billion euros and the government could again muster such a sum, if necessary.

Obsessed with running a balanced budget, Germany has produced surpluses for years, ignoring calls for more spending to boost growth.

The German economy could have continued to shrink over the summer as industrial production drops amid a dearth of orders, the Bundesbank said on Monday, suggesting that the euro zone's biggest economy is now in a recession.

The German economy could have continued to shrink over the summer as industrial production drops amid a dearth of orders, the Bundesbank said on Monday, suggesting that the euro zone's biggest economy is now in a recession. German growth contracted in the second quarter on slumping exports as a global trade war, China's slowdown and Brexit uncertainty sapped confidence, dealing a blow to an export-focused economy. "Overall economic performance could again decline slightly," the Bundesbank said in a monthly report. "The main reason for this is the continuing downturn in the industry," the central bank said, pointing to a significant decline in orders and a big drop in sentiment indicators for manufacturing firms. While domestic consumption continues to isolate the economy, the jobs market is already showing signs of weakness and confidence in the services sector is also dropping, the Bundesbank added. Still, the construction boom is likely to continue, providing some support. While Germany has so far rejected the idea of boosting public spending to offset the slowdown, Finance Minister Olaf Scholz said that Berlin has the financial strength to counter any future economic crisis "with full force". Speaking on Sunday, Scholz said the global financial crisis in 2008/2009 had cost Germany roughly 50 billion euros and the government could again muster such a sum, if necessary. Obsessed with running a balanced budget, Germany has produced surpluses for years, ignoring calls for more spending to boost growth.

German economy could continue to shrink: Bundesbank

Imran Khan has completed one year of being Prime Minister of Pakistan. See how was Pakistan's economy changed under Imran Khan. Price of bread is up by 25% in the last year, petrol prices up by over 20%. You can imagine it all by yourself now. Watch this video to know more.

Inflation crippling Pak economy, petrol prices up by over 20%

Can the global economy regain strength? Watch the video for the detailed information.

WION Dispatch: Can global economy regain strength?

It's been a year since the <a href="https://www.wionews.com/south-asia/imran-khans-admission-of-terrorists-presence-in-pakistan-may-irk-army-243989">Imran Khan government</a> stormed to power in Islamabad, promising an end to corruption and an economic turnaround and prosperity for the Pakistanis.

Imran khan had hailed his vision as 'Naya Pakistan'. It was meant to fulfil the aspirations of his countrymen.

But even after completion of one year&nbsp;of&nbsp;Imran&nbsp;Khan-led&nbsp;government, the economic reality of Pakistan is in stark contrast to what had been promised.

Author and journalist, Reham Khan, who is also a former wife of the current prime minister of Pakistan called Imran's government a selected government by Army which is ruining nation's economy.

Watch: Has Imran Khan delivered 'Naya Pakistan'?

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"The selected government of Pakistan has completed one year and the selectors are worried. They should be worried if they are not. In one year we saw what happened to the stock exchange, we hit the lowest of the stock exchange within a year. Compare it to August 17 last year, it was 42,500 points and now it is 28,900 points," said Reham Khan.

"There was a time when the one dollar was equal to 105 Pakistan rupees, our heart was sinking, but it was stable for some time. Last year I had predicted dollar would touch 155, now we are ashamed and in pain that our rupee has seen a drop of 33 per cent," she added.

Prime minister Imran Khan has accepted that the imposition of 200 per cent duty by India after the Pulwama terror attack has badly affected Pakistan's economy.

Pakistan is facing global isolation more than ever. It has been grey-listed by the FATF. And under president trump, the US military aid to the country is drying up.

On the domestic front, the country is in the grip of inflation. Prices of essential commodities have gone up and the common people are feeling the pinch.

Petrol and diesel which were retailing at Rs 95 and Rs 112 per litre are now retailing at Rs 117 and Rs 132 per litre.

CNG which retailed at Rs 81 per kg at this time last year, is now retailing at Rs 123 per kg.

The Pakistani rupee too has taken a beating against the Dollar. From exchanging at rs 123 against one dollar, the Pakistani rupee has seen a sharp decline and now has an exchange rate of 158 Pakistani rupees against a dollar.

Price of dry bread has shot up by over 25% in just the last year. Milk, tomatoes, onions, sugar and other daily essentials have also become dearer.

It's been a year since the Imran Khan government stormed to power in Islamabad, promising an end to corruption and an economic turnaround and prosperity for the Pakistanis.

It's been a year since the Imran Khan government stormed to power in Islamabad, promising an end to corruption and an economic turnaround and prosperity for the Pakistanis. Imran khan had hailed his vision as 'Naya Pakistan'. It was meant to fulfil the aspirations of his countrymen. But even after completion of one year of Imran Khan-led government, the economic reality of Pakistan is in stark contrast to what had been promised. Author and journalist, Reham Khan, who is also a former wife of the current prime minister of Pakistan called Imran's government a selected government by Army which is ruining nation's economy. Watch: Has Imran Khan delivered 'Naya Pakistan'? × "The selected government of Pakistan has completed one year and the selectors are worried. They should be worried if they are not. In one year we saw what happened to the stock exchange, we hit the lowest of the stock exchange within a year. Compare it to August 17 last year, it was 42,500 points and now it is 28,900 points," said Reham Khan. "There was a time when the one dollar was equal to 105 Pakistan rupees, our heart was sinking, but it was stable for some time. Last year I had predicted dollar would touch 155, now we are ashamed and in pain that our rupee has seen a drop of 33 per cent," she added. Prime minister Imran Khan has accepted that the imposition of 200 per cent duty by India after the Pulwama terror attack has badly affected Pakistan's economy. Pakistan is facing global isolation more than ever. It has been grey-listed by the FATF. And under president trump, the US military aid to the country is drying up. On the domestic front, the country is in the grip of inflation. Prices of essential commodities have gone up and the common people are feeling the pinch. Petrol and diesel which were retailing at Rs 95 and Rs 112 per litre are now retailing at Rs 117 and Rs 132 per litre. CNG which retailed at Rs 81 per kg at this time last year, is now retailing at Rs 123 per kg. The Pakistani rupee too has taken a beating against the Dollar. From exchanging at rs 123 against one dollar, the Pakistani rupee has seen a sharp decline and now has an exchange rate of 158 Pakistani rupees against a dollar. Price of dry bread has shot up by over 25% in just the last year. Milk, tomatoes, onions, sugar and other daily essentials have also become dearer.

'Selected government of Pakistan' should be worried about economy: Reham Khan

Argentina's Economy Minister Nicolas Dujovne resigned Saturday after a week of economic tumult caused by <a href="https://www.wionews.com/.../mauricio-macri-suffers-crushing-defeat-in-key- argentina-primaries-242365">President Mauricio Macri's defeat</a> in a primary poll ahead of a general election.

Dujovne will be replaced by Hernan Lacunza, economy minister for Buenos Aires province, Argentine media reported.&nbsp;

The country's peso ended the week having shed 20 per cent of its value against the US dollar as both Fitch and S&amp;P cut the South American country's long-term credit rating, citing increased uncertainty and a rising risk of default.

Dujovne said, in a letter posted on the website of La Nacion newspaper, he was "convinced that, under the circumstances, the (government's) management needs significant renewal in the economic arena."&nbsp;

He leaves in the middle of a <a href="https://www.wionews.com/.../argentinas-stock-exchange-crashes-after- president-macris-party-loses-in-primary-election-242522">deepening economic crisis</a> following last Sunday's primary elections in which market-friendly Macri was dealt a huge blow in his bid for re-election when he polled 15 points less than centre-left Peronist candidate Alberto Fernandez.

The primaries serve as a bellwether for general elections in October. Dujovne's announcement marks the first change in Macri's cabinet since voters went to the polls.

Fitch, which downgraded Argentina's credit rating two notches to "CCC," said the centre-right's defeat "increases risks of a break from the policy strategy of the current administration of Mauricio Macri guided by a program with the IMF."

Fernandez, now the clear favourite to unseat Macri, has questioned the reform program backed by a $56 billion rescue package from the International Monetary Fund.

Standard &amp; Poor's dropped Argentina's rating a single grade from "B" to "B-."

"My resignation is consistent with a government and political space that listens to the people and that acts accordingly," Dujovne said, in a clear message to the Argentine electorate, which still has two months left until voting in the presidential elections.

The country is currently in a recession and posted 22 per cent inflation for the first half of the year -- one of the highest rates in the world -- but the IMF said Macri's reform program was beginning to yield results.

The new economy minister will have the difficult task of trying to instil peace of mind in the markets while simultaneously dealing with the country's recession in the midst of Macri's uphill election battle.

In Argentina, 32 per cent of the population lives below the poverty line.

The country has annual inflation of more than 50 per cent.&nbsp;

Argentina's Economy Minister Nicolas Dujovne resigned Saturday after a week of economic tumult caused by President Mauricio Macri's defeat in a primary poll ahead of a general election.

Argentina's Economy Minister Nicolas Dujovne resigned Saturday after a week of economic tumult caused by President Mauricio Macri's defeat in a primary poll ahead of a general election. Dujovne will be replaced by Hernan Lacunza, economy minister for Buenos Aires province, Argentine media reported. The country's peso ended the week having shed 20 per cent of its value against the US dollar as both Fitch and S&P cut the South American country's long-term credit rating, citing increased uncertainty and a rising risk of default. Dujovne said, in a letter posted on the website of La Nacion newspaper, he was "convinced that, under the circumstances, the (government's) management needs significant renewal in the economic arena." He leaves in the middle of a deepening economic crisis following last Sunday's primary elections in which market-friendly Macri was dealt a huge blow in his bid for re-election when he polled 15 points less than centre-left Peronist candidate Alberto Fernandez. The primaries serve as a bellwether for general elections in October. Dujovne's announcement marks the first change in Macri's cabinet since voters went to the polls. Fitch, which downgraded Argentina's credit rating two notches to "CCC," said the centre-right's defeat "increases risks of a break from the policy strategy of the current administration of Mauricio Macri guided by a program with the IMF." Fernandez, now the clear favourite to unseat Macri, has questioned the reform program backed by a $56 billion rescue package from the International Monetary Fund. Standard & Poor's dropped Argentina's rating a single grade from "B" to "B-." "My resignation is consistent with a government and political space that listens to the people and that acts accordingly," Dujovne said, in a clear message to the Argentine electorate, which still has two months left until voting in the presidential elections. The country is currently in a recession and posted 22 per cent inflation for the first half of the year -- one of the highest rates in the world -- but the IMF said Macri's reform program was beginning to yield results. The new economy minister will have the difficult task of trying to instil peace of mind in the markets while simultaneously dealing with the country's recession in the midst of Macri's uphill election battle. In Argentina, 32 per cent of the population lives below the poverty line. The country has annual inflation of more than 50 per cent.

Argentina's economy minister Nicolas Dujovne resigns amid deepening crisis

Prime Minister Narendra Modi on Thursday said making local products more attractive will boost India's credentials as an export hub and asserted that 'Zero Defect, Zero Effect' — high-quality, eco-friendly products — will be the guiding principle in this process.

Modi also asserted that making India a 5 trillion dollar economy is not difficult if everyone citizen strives for it.

"Time has come to think about how we can boost exports. Every district of India has so much to offer, therefore, there is a need to make local products attractive. This may help in the emergence of export hubs. Our guiding principle is Zero Defect, Zero Effect," said Prime Minister Modi while addressing the nation from the Red Fort on the 73rd Independence Day.

"Why shouldn't we think of becoming an export hub? Every region in India has its own unique products, indigenous handicraft and its own handloom. Why can't we utilise all this to provide India the impetus for becoming an exporting nation?" he asked.

Stressing that world is eager to trade with India, the Prime Minister said, "Today, the government is stable and policy system is predictable. We are putting all efforts to keep prices under check and speed up development. The fundamentals of our economy are strong."

Modi also emphasised on the Centre's mission of making India a 5 trillion dollar economy.

"Everyone is thinking how will we move forward? Who will we develop? To what extent can we develop? Fulfilling the dream of five trillion dollar economy is the answer to it. This target can be achieved if every citizen starts contributing to the nation. It is not difficult if everyone strives for it."

Prime Minister took a jibe at the previous UPA government and said India became a two trillion dollars economy in the last 70 years while one trillion dollars was added in the last five years.

"In the last 70 years we became a two trillion dollar economy, but in the last five years, we added one trillion dollars to the economy. This gives me the confidence of becoming a five trillion dollar economy in the coming years," he said.

Prime Minister Narendra Modi on Thursday said making local products more attractive will boost India's credentials as an export hub and asserted that 'Zero Defect, Zero Effect' — high-quality, eco-friendly products — will be the guiding principle in this process.

Prime Minister Narendra Modi on Thursday said making local products more attractive will boost India's credentials as an export hub and asserted that 'Zero Defect, Zero Effect' — high-quality, eco-friendly products — will be the guiding principle in this process. Modi also asserted that making India a 5 trillion dollar economy is not difficult if everyone citizen strives for it. "Time has come to think about how we can boost exports. Every district of India has so much to offer, therefore, there is a need to make local products attractive. This may help in the emergence of export hubs. Our guiding principle is Zero Defect, Zero Effect," said Prime Minister Modi while addressing the nation from the Red Fort on the 73rd Independence Day. "Why shouldn't we think of becoming an export hub? Every region in India has its own unique products, indigenous handicraft and its own handloom. Why can't we utilise all this to provide India the impetus for becoming an exporting nation?" he asked. Stressing that world is eager to trade with India, the Prime Minister said, "Today, the government is stable and policy system is predictable. We are putting all efforts to keep prices under check and speed up development. The fundamentals of our economy are strong." Modi also emphasised on the Centre's mission of making India a 5 trillion dollar economy. "Everyone is thinking how will we move forward? Who will we develop? To what extent can we develop? Fulfilling the dream of five trillion dollar economy is the answer to it. This target can be achieved if every citizen starts contributing to the nation. It is not difficult if everyone strives for it." Prime Minister took a jibe at the previous UPA government and said India became a two trillion dollars economy in the last 70 years while one trillion dollars was added in the last five years. "In the last 70 years we became a two trillion dollar economy, but in the last five years, we added one trillion dollars to the economy. This gives me the confidence of becoming a five trillion dollar economy in the coming years," he said.

Dream of 5 trillion dollar economy not difficult if everyone strives for it: PM Modi

India celebrates 73rd Independence Day

Only 200 out of 1,600 garment factories<a href="https://www.wionews.com/south-asia/awami-league-was-formed-to-bring-back-bangladeshs-independence-pm-sheikh-hasina-229724"> in Bangladesh</a> have met the requirements of an international accord on worker safety, and 400 factories have been barred from taking international orders, the industry body's president said on Sunday.

The Accord on Fire and Building Safety in Bangladesh was set up by European fashion brands to improve factory safety in Bangladesh after a garment factory complex collapsed in 2013 killing more than 1,100 people.

The five-year pact was originally due to expire in May 2018 but the transition period has been extended. The pact's factory oversight team will then hand over to a government body set up for that purpose.

Rubana Huq, president of Bangladesh <a href="https://www.wionews.com/south-asia/bangladesh-protests-against-gas-price-rise-233801">Garment Manufacturers and Exporters Association </a>(BGMEA), accused the accord's members of unilaterally imposing new requirements that were hurting the sector. She said she had met with their inspectors on Saturday to urge them to consult with manufacturers on their decisions.

"We had an agreement with Accord in May this year that it will not take any decision unilaterally but that has not been honoured," she said.

"Since the formation of Accord, we implemented a lot of remediation as per its requirements that involved huge investment. Now, in the name of final checks, the Accord is asking for several remediations."

Huq also said that of the 1,600 factories inspected by the team between 2014 and 2019, only 200 had been awarded completion certificates.

At least 400 factories which inspectors found were to slow to comply with the new safety rules were as a consequence no longer allowed to accept orders from the Western brands that are members of the accord, she said.

The Bangladesh garment industry is the second-largest export earning country after China and the sector represents about 16 per cent of the economy and employs over 4 million workers.

In June, garment manufacturers demanded higher export subsidies from the government, saying proposals in the latest national budget, unveiled last week, was not enough to compensate for higher production costs and low prices.

Only 200 out of 1,600 garment factories in Bangladesh have met the requirements of an international accord on worker safety, and 400 factories have been barred from taking international orders, the industry body's president said on Sunday.

Only 200 out of 1,600 garment factories in Bangladesh have met the requirements of an international accord on worker safety, and 400 factories have been barred from taking international orders, the industry body's president said on Sunday. The Accord on Fire and Building Safety in Bangladesh was set up by European fashion brands to improve factory safety in Bangladesh after a garment factory complex collapsed in 2013 killing more than 1,100 people. The five-year pact was originally due to expire in May 2018 but the transition period has been extended. The pact's factory oversight team will then hand over to a government body set up for that purpose. Rubana Huq, president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), accused the accord's members of unilaterally imposing new requirements that were hurting the sector. She said she had met with their inspectors on Saturday to urge them to consult with manufacturers on their decisions. "We had an agreement with Accord in May this year that it will not take any decision unilaterally but that has not been honoured," she said. "Since the formation of Accord, we implemented a lot of remediation as per its requirements that involved huge investment. Now, in the name of final checks, the Accord is asking for several remediations." Huq also said that of the 1,600 factories inspected by the team between 2014 and 2019, only 200 had been awarded completion certificates. At least 400 factories which inspectors found were to slow to comply with the new safety rules were as a consequence no longer allowed to accept orders from the Western brands that are members of the accord, she said. The Bangladesh garment industry is the second-largest export earning country after China and the sector represents about 16 per cent of the economy and employs over 4 million workers. In June, garment manufacturers demanded higher export subsidies from the government, saying proposals in the latest national budget, unveiled last week, was not enough to compensate for higher production costs and low prices.

Only one in eight Bangladesh garment factories passed international safety inspection: Industry head

The grounding of the 737 MAX for more than four months after two deadly accidents has tarnished Boeing's reputation, but it still has the confidence of US policymakers.

This is despite the fact that one of the MAX flight systems, the MCAS, has been cited in both accidents.

Is this an indication that the American aerospace giant is too big to fail?&nbsp;

President Donald Trump, whose mantra is "America first," certainly criticized Boeing early in his administration over the presidential plane, Air Force One, but he has been largely silent about the recent woes.

The wave of negative press about the flaws that caused the deaths of 346 people did not prompt legislators to summon Boeing CEO Dennis Muilenburg before Congress to inflict on him the kind of humiliation Wall Street bankers were subject to following the global financial crisis.&nbsp;

"Boeing is one of the engines of the US economy, it's way too big and too important for the United States," said Michel Merluzeau, an expert at Air Insight Research.

Political ties

If American politicians were to attack the manufacturer, they would be shooting themselves in the foot, Merluzeau said, because "there are many jobs involved, a very, very numerous supply chain and it cannot be replaced with Facebook or Google that don't produce anything tangible."&nbsp;

Founded 103 years ago, Boeing employs more than 150,000 people around the world, the vast majority in the United States.&nbsp;

In addition to direct jobs, its subcontractors -- like General Electric (GE), United Technologies and Spirit Aerosystems -- are large US industrial employers.&nbsp;

The location of Boeing plants resembles a political campaign map, with facilities in Republican strongholds like Alabama, South Carolina and Texas, and Democratic areas like California and Washington, as well as states that helped Trump win the election: Pennsylvania and Arizona.&nbsp;

And Muilenburg has shown political savvy in his picks for the company's board of directors, naming Nikki Haley, former governor of South Carolina and Trump's former ambassador to the United Nations, and Caroline Kennedy, an ally of former President Barack Obama and daughter of former president John F. Kennedy.&nbsp;

Air Force One

Boeing is a dominant player not just in civilian aircraft but in the defence and space industries and is a major supplier to the Pentagon.

The company produced the famous B-17 and B-29 bombers of World War II and the B-52 used the Vietnam War.

Today it produces a variety of aircraft including the F/A-18 Super Hornet fighter jet, Apache attack helicopters, the B-1 bomber and combat drones.&nbsp;

It also is part of SpaceX, which will manage travel to the International Space Station.

And Boeing manufactures the presidential plane, the iconic Air Force One.

But Boeing also "can be used as a strategic tool," said Arthur Wheaton, a professor at Cornell University in New York.&nbsp;

Chinese purchases of Boeing aircraft are part of trade negotiations with Beijing, according to a source, since that can be a fast way to reduce the US trade deficit.&nbsp;

US civilian aircraft exports fell 12 per cent to $20.4 billion in May, due to the MAX crisis, which affected the GDP, according to government data.

The grounding of the 737 MAX for more than four months after two deadly accidents has tarnished Boeing's reputation, but it still has the confidence of US policymakers.

The grounding of the 737 MAX for more than four months after two deadly accidents has tarnished Boeing's reputation, but it still has the confidence of US policymakers. This is despite the fact that one of the MAX flight systems, the MCAS, has been cited in both accidents. Is this an indication that the American aerospace giant is too big to fail? President Donald Trump, whose mantra is "America first," certainly criticized Boeing early in his administration over the presidential plane, Air Force One, but he has been largely silent about the recent woes. The wave of negative press about the flaws that caused the deaths of 346 people did not prompt legislators to summon Boeing CEO Dennis Muilenburg before Congress to inflict on him the kind of humiliation Wall Street bankers were subject to following the global financial crisis. "Boeing is one of the engines of the US economy, it's way too big and too important for the United States," said Michel Merluzeau, an expert at Air Insight Research. Political ties If American politicians were to attack the manufacturer, they would be shooting themselves in the foot, Merluzeau said, because "there are many jobs involved, a very, very numerous supply chain and it cannot be replaced with Facebook or Google that don't produce anything tangible." Founded 103 years ago, Boeing employs more than 150,000 people around the world, the vast majority in the United States. In addition to direct jobs, its subcontractors -- like General Electric (GE), United Technologies and Spirit Aerosystems -- are large US industrial employers. The location of Boeing plants resembles a political campaign map, with facilities in Republican strongholds like Alabama, South Carolina and Texas, and Democratic areas like California and Washington, as well as states that helped Trump win the election: Pennsylvania and Arizona. And Muilenburg has shown political savvy in his picks for the company's board of directors, naming Nikki Haley, former governor of South Carolina and Trump's former ambassador to the United Nations, and Caroline Kennedy, an ally of former President Barack Obama and daughter of former president John F. Kennedy. Air Force One Boeing is a dominant player not just in civilian aircraft but in the defence and space industries and is a major supplier to the Pentagon. The company produced the famous B-17 and B-29 bombers of World War II and the B-52 used the Vietnam War. Today it produces a variety of aircraft including the F/A-18 Super Hornet fighter jet, Apache attack helicopters, the B-1 bomber and combat drones. It also is part of SpaceX, which will manage travel to the International Space Station. And Boeing manufactures the presidential plane, the iconic Air Force One. But Boeing also "can be used as a strategic tool," said Arthur Wheaton, a professor at Cornell University in New York. Chinese purchases of Boeing aircraft are part of trade negotiations with Beijing, according to a source, since that can be a fast way to reduce the US trade deficit. US civilian aircraft exports fell 12 per cent to $20.4 billion in May, due to the MAX crisis, which affected the GDP, according to government data.

Is Boeing too big to fail?

Here's A Report On India's NPA Crisis & The Measures Brought In To Tackle The Menace VG Siddhartha's demise has brought in the issue of tax evasion and law enforcement to the fore. If tax evasion is one problem in the economy, the other problem is bad loans. Here too, several big businessmen have been 'wilful offenders' and several bankers are accused of granting dodgy loans. Here's a look at India's NPA story.

Gravitas: India's bad loan problem

Russian economic growth will hover around 1.8 per cent for the next several years unless Moscow enacts structural reforms, the International Monetary Fund said Friday.

While spending on public infrastructure and a deeply unpopular pension reform could boost business activity, "absent deeper structural reforms, long-run growth is projected to settle around 1.8 per cent," an IMF statement said.

President Vladimir Putin last year launched 12 "national projects" to modernise the economy and improve Russians' quality of life.

But economic activity has nonetheless stalled this year.

The IMF predicts the growth of 1.2 per cent in 2019.

The World Bank last month gave the same figure, revised lower from a previous 1.8 per cent.

The national projects include programmes in healthcare, housing, the digital economy, environment, and others that should be carried out over five years starting from 2019, to the cost of $400 billion.

More than a quarter of that is to be funded by investors.

The IMF said these projects "have the potential to stimulate activity" but only if implemented effectively and combined with other reforms.

"Ambitious structural reforms will be important to raise growth," the IMF said, stressing the need for Moscow to create a "vibrant private sector."

Russian economic growth will hover around 1.8 per cent for the next several years unless Moscow enacts structural reforms, the International Monetary Fund said Friday.

Russian economic growth will hover around 1.8 per cent for the next several years unless Moscow enacts structural reforms, the International Monetary Fund said Friday. While spending on public infrastructure and a deeply unpopular pension reform could boost business activity, "absent deeper structural reforms, long-run growth is projected to settle around 1.8 per cent," an IMF statement said. President Vladimir Putin last year launched 12 "national projects" to modernise the economy and improve Russians' quality of life. But economic activity has nonetheless stalled this year. The IMF predicts the growth of 1.2 per cent in 2019. The World Bank last month gave the same figure, revised lower from a previous 1.8 per cent. The national projects include programmes in healthcare, housing, the digital economy, environment, and others that should be carried out over five years starting from 2019, to the cost of $400 billion. More than a quarter of that is to be funded by investors. The IMF said these projects "have the potential to stimulate activity" but only if implemented effectively and combined with other reforms. "Ambitious structural reforms will be important to raise growth," the IMF said, stressing the need for Moscow to create a "vibrant private sector."

Absent reforms, Russian growth eyed at 1.8%: International Monetary Fund

JRD Tata famously said population was one of India’s biggest liabilities. Ironically, it may turn out to be one of India’s biggest assets.&nbsp;

The fabled demographic dividend is already upon us. The dividend kicks in when the total number of Indians in the “productive” age group of 15-65 years surpasses the number of Indians above the age of 65 and below the age of 15.&nbsp;

India entered this zone in 2018. The productivity dividend is estimated to last till 2055 when the population of over-65s and under-15s will once again overtake the total number of working-age Indians between 15 and 65. The window of India’s demographic dividend will thus remain open for another 36 years.&nbsp;

The United Nations Population Fund (UNFPA), formerly known as the United Nations Fund for Population Activities, says economic growth peaks during the period when a country’s working-age population of 15-65 is greater than the very old and the very young.&nbsp;

Japan’s demographic dividend began in 1964, leading to 25 years of high economic growth and the “Japanese miracle”. Though it technically lasted till 2004, Japan’s growth petered out from the 1990s.&nbsp;

China’s own demographic dividend began in 1996, coinciding with its surging economy and double-digit annual GDP growth, but is expected to last for an even shorter period than Japan’s demographic dividend. The key reason is former leader Mao Zedong’s one-child policy in the 1960s that 50 years later has progressively reduced the number of young Chinese.&nbsp;

The “greying” of China is one of the keys, but relatively unheralded causes of Beijing’s current economic slowdown just 23 years into its demographic dividend.&nbsp;

While the trade war with the United States has contributed to a dip in China’s economic growth, the steep fall in the productive population aged 15-65 constitutes a long-term structural economic weakness for China.&nbsp;

A young productive workforce spurs economic growth, but as a country becomes wealthier, women tend to have fewer children. Lower fertility rates lead to a gradual shift towards an ageing population. Moreover, as people grow richer, they live longer, increasing the ratio of over-65s relative to those in the working-age group of 15-65.&nbsp;

India’s female fertility rate has fallen dramatically since Independence. It was 5.9 children per woman in 1950, 3.8 in 1994 and 2.2 in 2018. The replacement rate, when births and deaths are roughly equal, is around 2.1. Thus India’s population is likely to start plateauing at approximately 1.55 billion within the next two decades. By then India’s total population would have surpassed China’s population, which will have begun to decline as its fertility rates fall further.&nbsp;

The other key metric is the dependency ratio — the percentage of the very old and very young who are supported by those in the productive 15-65 age group of the population. For India, this dependency ratio was as high as 81.5% in 1966. It fell to 60% in 2005 and to 49.8 per cent in 2018 when India formally entered its demographic dividend zone. Thus for the first time since Independence, India has fewer dependents than workers.&nbsp;

The demographic dividend though comes with a health warning: it can quite easily be squandered if education, health and skill development don’t keep pace.&nbsp;

Pessimists speak ominously of a demographic disaster if young workers in the productive age group are not given the skill sets needed in a rapidly changing economy. Poverty is a big handicap. Malnutrition is another. When nearly a quarter of the working-age population lacks education, healthcare and skills, the demographic dividend can be wasted. It is therefore critical to get India’s health and education parameters up to scratch.&nbsp;

Prime Minister Narendra Modi is right to focus on delivering welfare benefits to the poorest Indians — sanitation, health insurance, LPG cylinders, electricity and water. The focus on skill development and vocational training is crucial too. But such micro measures need to be supplemented with macroeconomic initiatives.&nbsp;

Unless the economy returns to an 8 per cent growth trajectory, providing jobs and investment opportunities, India might miss the demographic dividend bus. The window is narrow. Of the 36 years India has, the first 20 years are critical. As China and Japan witnessed, the effects of the demographic dividend taper off after an initial burst.&nbsp;

To reflate the economy, Finance Minister Nirmala Sitharaman must focus on structural reforms — tax, foreign investment, privatisation, labour and land.&nbsp;

Some of these are works in progress (labour and the direct tax code) while others (foreign investment and privatisation) are hostage to politics or ideology. The new direct tax code, to be announced shortly, should rationalise India’s complex and bloated tax regime.&nbsp;

Sitharaman’s most positive remark since her disappointing Union Budget holds promise. Speaking in the Rajya Sabha last week, Sitharaman said: “Reduction in the corporate tax rate is done with an intention. We will bring the corporate tax from the high rate that it was, from 30 per cent&nbsp;down to 25 per cent (for all companies). It was a commitment given in the first Budget in 2014. I have to honour it.”

It is important such intent translates into action. Structural economic reforms — alongside welfare schemes — are imperative if India is to make the fullest use of its once-in-a-generation demographic dividend.&nbsp;

(This article was originally published on The DNA. Read the <a href="https://www.dnaindia.com/analysis/column-india-s-decisive-dividend-2777769">original article</a>)

(Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL.)

JRD Tata famously said population was one of India’s biggest liabilities. Ironically, it may turn out to be one of India’s biggest assets. The fabled demographic dividend is already upon us.

JRD Tata famously said population was one of India’s biggest liabilities. Ironically, it may turn out to be one of India’s biggest assets. The fabled demographic dividend is already upon us. The dividend kicks in when the total number of Indians in the “productive” age group of 15-65 years surpasses the number of Indians above the age of 65 and below the age of 15. India entered this zone in 2018. The productivity dividend is estimated to last till 2055 when the population of over-65s and under-15s will once again overtake the total number of working-age Indians between 15 and 65. The window of India’s demographic dividend will thus remain open for another 36 years. The United Nations Population Fund (UNFPA), formerly known as the United Nations Fund for Population Activities, says economic growth peaks during the period when a country’s working-age population of 15-65 is greater than the very old and the very young. Japan’s demographic dividend began in 1964, leading to 25 years of high economic growth and the “Japanese miracle”. Though it technically lasted till 2004, Japan’s growth petered out from the 1990s. China’s own demographic dividend began in 1996, coinciding with its surging economy and double-digit annual GDP growth, but is expected to last for an even shorter period than Japan’s demographic dividend. The key reason is former leader Mao Zedong’s one-child policy in the 1960s that 50 years later has progressively reduced the number of young Chinese. The “greying” of China is one of the keys, but relatively unheralded causes of Beijing’s current economic slowdown just 23 years into its demographic dividend. While the trade war with the United States has contributed to a dip in China’s economic growth, the steep fall in the productive population aged 15-65 constitutes a long-term structural economic weakness for China. A young productive workforce spurs economic growth, but as a country becomes wealthier, women tend to have fewer children. Lower fertility rates lead to a gradual shift towards an ageing population. Moreover, as people grow richer, they live longer, increasing the ratio of over-65s relative to those in the working-age group of 15-65. India’s female fertility rate has fallen dramatically since Independence. It was 5.9 children per woman in 1950, 3.8 in 1994 and 2.2 in 2018. The replacement rate, when births and deaths are roughly equal, is around 2.1. Thus India’s population is likely to start plateauing at approximately 1.55 billion within the next two decades. By then India’s total population would have surpassed China’s population, which will have begun to decline as its fertility rates fall further. The other key metric is the dependency ratio — the percentage of the very old and very young who are supported by those in the productive 15-65 age group of the population. For India, this dependency ratio was as high as 81.5% in 1966. It fell to 60% in 2005 and to 49.8 per cent in 2018 when India formally entered its demographic dividend zone. Thus for the first time since Independence, India has fewer dependents than workers. The demographic dividend though comes with a health warning: it can quite easily be squandered if education, health and skill development don’t keep pace. Pessimists speak ominously of a demographic disaster if young workers in the productive age group are not given the skill sets needed in a rapidly changing economy. Poverty is a big handicap. Malnutrition is another. When nearly a quarter of the working-age population lacks education, healthcare and skills, the demographic dividend can be wasted. It is therefore critical to get India’s health and education parameters up to scratch. Prime Minister Narendra Modi is right to focus on delivering welfare benefits to the poorest Indians — sanitation, health insurance, LPG cylinders, electricity and water. The focus on skill development and vocational training is crucial too. But such micro measures need to be supplemented with macroeconomic initiatives. Unless the economy returns to an 8 per cent growth trajectory, providing jobs and investment opportunities, India might miss the demographic dividend bus. The window is narrow. Of the 36 years India has, the first 20 years are critical. As China and Japan witnessed, the effects of the demographic dividend taper off after an initial burst. To reflate the economy, Finance Minister Nirmala Sitharaman must focus on structural reforms — tax, foreign investment, privatisation, labour and land. Some of these are works in progress (labour and the direct tax code) while others (foreign investment and privatisation) are hostage to politics or ideology. The new direct tax code, to be announced shortly, should rationalise India’s complex and bloated tax regime. Sitharaman’s most positive remark since her disappointing Union Budget holds promise. Speaking in the Rajya Sabha last week, Sitharaman said: “Reduction in the corporate tax rate is done with an intention. We will bring the corporate tax from the high rate that it was, from 30 per cent down to 25 per cent (for all companies). It was a commitment given in the first Budget in 2014. I have to honour it.” It is important such intent translates into action. Structural economic reforms — alongside welfare schemes — are imperative if India is to make the fullest use of its once-in-a-generation demographic dividend. (This article was originally published on The DNA. Read the original article) (Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL.)

Economic reforms and welfare schemes are key if India is to make fullest use of its demography

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