ndia's manufacturing activity declined at its sharpest pace on record in April as the lockdown announced by the government to curb the rapid spread of the deadly COVID-19

India's factory activity slumps to record low in April

The world and the world around us has become uncertain. The impact of COVID-19 pandemic will be felt by India both internally and externally. &nbsp;

Internally, a full lockdown cannot continue because the economy needs to be unlocked. Reignited. India needs to start working, even if a real threat of COVID-19 pandemic persists. We cannot surrender our future to a virus. A month lockdown has brought an already slowing economy to a grinding halt. &nbsp;

Externally, the world economies will become inward-looking. The global recession is underway. Liberal economic order is taking a bow as protectionism will now flourish. In the geopolitical order, India will be the middle power between the United States and China. It will have substantial bargaining power in a deepening US-China confrontation. &nbsp;

In the last two months, the pandemic scenario was so dynamic, that it was difficult to reflect upon the impact. An extended lockdown in India, the opaqueness and the revelations concerning China’s role and the abdication of the United States to lead the world in overcoming this crisis has made the picture clearer. &nbsp;

Internal Challenges and Opportunities&nbsp;

There is a prediction of zero percentage GDP Growth for India. India will bear ‘catastrophic consequences’ and 40 crore jobs are at peril, as per an ILO report. A large number of people are already losing their jobs and many small businesses have started bearing the brunt. Unorganised sector — which is already enduring the burden of an unplanned lockdown is hurt the most. Millions are becoming poor. Migrants have still not reached home. Women and children isolated in the houses have become vulnerable owing to a spike in the cases of abuse. Societal fissures have deepened, owing to the complacency of governments in allowing religious congregations in the beginning. Communal harmony is in danger. &nbsp;

The Central government has announced two major packages. First, an ‘economic package’ worth Rs 1.7 lakh crore for the poor, which entails bare minimum cash transfers to women, some minuscule help to health workers, no real help for farmers and zero assistance to the small and medium businesses. Second, an ‘Emergency Response and Health System Preparedness Package’ worth Rs 15,000 crores has been announced for states. &nbsp;

Health is a state subject. It is the states which are required to take lead in fighting the pandemic. However, no real funding has been given to states. For instance, Punjab has been handed over a pittance sum of Rs 71 crores to fight the pandemic. A big state like Karnataka has been allocated only Rs 395 crores. Kerala which has the second-highest number of cases has been allocated Rs 157 crores. This is too little. The union government should increase this funding so that states can start building the requisite healthcare infrastructure. &nbsp;

Supply chains are still disrupted. People are hungry and are mortgaging their dignity to stand in long queues, to get cooked food either from private bodies. Only 15 per cent&nbsp;of the poor have received the promised pulses under the union government’s package. Around 11 crore poor are estimated to be out of the entitled PDS net and are on the verge of starvation. &nbsp;

Even the most ardent supporters of the market economy feel that this is no time for fiscal prudence and a loosening of purse strings is the need of the hour. Cash transfers to the poor, tax breaks to industry, and deferment of loans, employee retaining packages for the small industries, wrapped in a large stimulus package is the need of the hour. How India deals with its economy would have a direct impact on its external trade and geopolitics at large. A nation’s external policy is shaped by its internal stability. &nbsp;

External Challenges and Opportunities &nbsp;

There is an economic web angle to the current crisis. US Fed’s balance sheet is now at record levels above $6 trillion, after the central bank pumped almost $2 trillion in quantitative easing since late February. The United States, therefore, is running high trade deficits and acting as a consumer market. Closer to home, China is acting as an investor. It wants to put the Yuan on the global currency map. China’s Belt and Road Initiative (BRI) and its numerous infrastructure projects make it an ideal power for smaller countries to gravitate towards itself. 
 
However, there is a constraint. With businesses shut in most of the developed world, who will China export too? After, all Economy 101 is based on supply and demand. With the demand weakening, can China retain its position as a major exporter? &nbsp;

India is in a unique position to bargain. On one side, the US would want India to spearhead its economic and geostrategic potential to counter China. Given that India also has a large sector for vaccination and pharmaceuticals, it would be heavily wooed by the United States. On the other side of the spectrum, China would want India to continue increasing its trade with it, the latter being a massive consumer market for its goods. &nbsp;

The newfound negotiating power of India places it as the middle power between two confrontationist nation-states. Yes, there will be other powers like Russia, Japan, and EU et al which may join either camp. However, traditional Indian foreign policy prefers installing ‘tents’ in either block to joining any ‘camp’ and that position will only get strengthened. &nbsp;

All this will be contingent on how India strengthens its economy — internally. And that should be our only focus, for the time being.&nbsp;

(Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL)

 
&nbsp;

The world and the world around us has become uncertain. The impact of COVID-19 pandemic will be felt by India both internally and externally. Internally, a full lockdown cannot continue because the economy needs to be unlocked.

The world and the world around us has become uncertain. The impact of COVID-19 pandemic will be felt by India both internally and externally. Internally, a full lockdown cannot continue because the economy needs to be unlocked. Reignited. India needs to start working, even if a real threat of COVID-19 pandemic persists. We cannot surrender our future to a virus. A month lockdown has brought an already slowing economy to a grinding halt. Externally, the world economies will become inward-looking. The global recession is underway. Liberal economic order is taking a bow as protectionism will now flourish. In the geopolitical order, India will be the middle power between the United States and China. It will have substantial bargaining power in a deepening US-China confrontation. In the last two months, the pandemic scenario was so dynamic, that it was difficult to reflect upon the impact. An extended lockdown in India, the opaqueness and the revelations concerning China’s role and the abdication of the United States to lead the world in overcoming this crisis has made the picture clearer. Internal Challenges and Opportunities There is a prediction of zero percentage GDP Growth for India. India will bear ‘catastrophic consequences’ and 40 crore jobs are at peril, as per an ILO report. A large number of people are already losing their jobs and many small businesses have started bearing the brunt. Unorganised sector — which is already enduring the burden of an unplanned lockdown is hurt the most. Millions are becoming poor. Migrants have still not reached home. Women and children isolated in the houses have become vulnerable owing to a spike in the cases of abuse. Societal fissures have deepened, owing to the complacency of governments in allowing religious congregations in the beginning. Communal harmony is in danger. The Central government has announced two major packages. First, an ‘economic package’ worth Rs 1.7 lakh crore for the poor, which entails bare minimum cash transfers to women, some minuscule help to health workers, no real help for farmers and zero assistance to the small and medium businesses. Second, an ‘Emergency Response and Health System Preparedness Package’ worth Rs 15,000 crores has been announced for states. Health is a state subject. It is the states which are required to take lead in fighting the pandemic. However, no real funding has been given to states. For instance, Punjab has been handed over a pittance sum of Rs 71 crores to fight the pandemic. A big state like Karnataka has been allocated only Rs 395 crores. Kerala which has the second-highest number of cases has been allocated Rs 157 crores. This is too little. The union government should increase this funding so that states can start building the requisite healthcare infrastructure. Supply chains are still disrupted. People are hungry and are mortgaging their dignity to stand in long queues, to get cooked food either from private bodies. Only 15 per cent of the poor have received the promised pulses under the union government’s package. Around 11 crore poor are estimated to be out of the entitled PDS net and are on the verge of starvation. Even the most ardent supporters of the market economy feel that this is no time for fiscal prudence and a loosening of purse strings is the need of the hour. Cash transfers to the poor, tax breaks to industry, and deferment of loans, employee retaining packages for the small industries, wrapped in a large stimulus package is the need of the hour. How India deals with its economy would have a direct impact on its external trade and geopolitics at large. A nation’s external policy is shaped by its internal stability. External Challenges and Opportunities There is an economic web angle to the current crisis. US Fed’s balance sheet is now at record levels above $6 trillion, after the central bank pumped almost $2 trillion in quantitative easing since late February. The United States, therefore, is running high trade deficits and acting as a consumer market. Closer to home, China is acting as an investor. It wants to put the Yuan on the global currency map. China’s Belt and Road Initiative (BRI) and its numerous infrastructure projects make it an ideal power for smaller countries to gravitate towards itself. However, there is a constraint. With businesses shut in most of the developed world, who will China export too? After, all Economy 101 is based on supply and demand. With the demand weakening, can China retain its position as a major exporter? India is in a unique position to bargain. On one side, the US would want India to spearhead its economic and geostrategic potential to counter China. Given that India also has a large sector for vaccination and pharmaceuticals, it would be heavily wooed by the United States. On the other side of the spectrum, China would want India to continue increasing its trade with it, the latter being a massive consumer market for its goods. The newfound negotiating power of India places it as the middle power between two confrontationist nation-states. Yes, there will be other powers like Russia, Japan, and EU et al which may join either camp. However, traditional Indian foreign policy prefers installing ‘tents’ in either block to joining any ‘camp’ and that position will only get strengthened. All this will be contingent on how India strengthens its economy — internally. And that should be our only focus, for the time being. (Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL)

India’s position in global order depends on how it restarts the economy post-COVID 19

India's economic growth may drop amid the coronavirus pandemic. The world bank expects that India's economic growth will be ranging between 1.5% to 2.8%. Watch report.

| COVID-19 impact on GDP: India GDP growth may drop to 1.5% to 2.8%

India is planning to restart some manufacturing after April 15 to help offset the economic damage of a nationwide coronavirus lockdown, two government sources said, even as it weighs extending the lockdown.

India may resume manufacturing operations

Growth in India’s dominant service sector accelerated at a pace not seen in over seven years last month, boosted by a recovery in foreign demand and solid business confidence, a private survey showed on Wednesday.

Also read: <a href="https://www.wionews.com/india-news/india-services-activity-returns-to-growth-in-sept-on-stronger-demand-pmi-21028">India services activity returned to growth in September: Study</a>

The Nikkei/IHS Markit Services Purchasing Managers’ Index climbed to 57.5 in February from January’s 55.5. It was the highest reading since January 2013 and comfortably above the 50-mark separating growth from contraction for a fourth month.

“Behind the resilience in the trend for business activity stands healthy demand for services from both the domestic and international markets,” Pollyanna De Lima, principal economist at IHS Markit, said in a release.

Also read:<a href="https://www.wionews.com/business-economy/indias-overall-export-shows-151-growth-during-april-october-262444"> India's overall export shows 1.51% growth during April-October</a>

“Positive gains in new work across the manufacturing and service sectors suggest that private-sector output will likely increase markedly again in March, boding well for final quarter GDP following expectations of a flat growth rate in Q3 FY 2019/20.”

The pace of expansion in a sub-index tracking new business slowed slightly from January’s seven-year high but remained above the long-term average since the index was first published in December 2005.

Also read:<a href="https://www.wionews.com/south-asia/indian-services-activity-plunges-into-contraction-in-november-on-cash-crackdown-9749"> Indian services activity plunges into contraction in November on cash crackdown</a>

New export business - a proxy of foreign demand - returned to expansion territory last month after contracting for the first time in 11 months in January. However, firms failed to significantly increase the pace of hiring.

“Service providers experienced a marked improvement in workforce productivity, with the sharp rise in business activity happening despite a softer and only modest increase in employment,” De Lima said.

A sister survey on Monday showed factory activity growth slowed in February from January’s eight-year high due to a modest weakening in demand and output.

&nbsp;

However, the composite PMI, which includes both manufacturing and services, rose to 57.6 in February from January’s 56.3, its highest in eight years.

Service providers remained optimistic about growth in the year ahead and the expectations index strengthened to a six month high.

On the price front, growth in both input cost and prices charged weakened only modestly in February, suggesting retail inflation is unlikely to slow significantly anytime soon.

Growth in India’s dominant service sector accelerated at a pace not seen in over seven years last month, boosted by a recovery in foreign demand and solid business confidence, a private survey showed on Wednesday.

Growth in India’s dominant service sector accelerated at a pace not seen in over seven years last month, boosted by a recovery in foreign demand and solid business confidence, a private survey showed on Wednesday. Also read: India services activity returned to growth in September: Study The Nikkei/IHS Markit Services Purchasing Managers’ Index climbed to 57.5 in February from January’s 55.5. It was the highest reading since January 2013 and comfortably above the 50-mark separating growth from contraction for a fourth month. “Behind the resilience in the trend for business activity stands healthy demand for services from both the domestic and international markets,” Pollyanna De Lima, principal economist at IHS Markit, said in a release. Also read: India's overall export shows 1.51% growth during April-October “Positive gains in new work across the manufacturing and service sectors suggest that private-sector output will likely increase markedly again in March, boding well for final quarter GDP following expectations of a flat growth rate in Q3 FY 2019/20.” The pace of expansion in a sub-index tracking new business slowed slightly from January’s seven-year high but remained above the long-term average since the index was first published in December 2005. Also read: Indian services activity plunges into contraction in November on cash crackdown New export business - a proxy of foreign demand - returned to expansion territory last month after contracting for the first time in 11 months in January. However, firms failed to significantly increase the pace of hiring. “Service providers experienced a marked improvement in workforce productivity, with the sharp rise in business activity happening despite a softer and only modest increase in employment,” De Lima said. A sister survey on Monday showed factory activity growth slowed in February from January’s eight-year high due to a modest weakening in demand and output. However, the composite PMI, which includes both manufacturing and services, rose to 57.6 in February from January’s 56.3, its highest in eight years. Service providers remained optimistic about growth in the year ahead and the expectations index strengthened to a six month high. On the price front, growth in both input cost and prices charged weakened only modestly in February, suggesting retail inflation is unlikely to slow significantly anytime soon.

India services growth at over seven-year high on strong export demand

The <a href="https://www.wionews.com/business-economy/retail-inflation-up-at-554-in-november-industrial-production-in-october-down-by-38-267913">retail inflation</a> in January accelerated to 7.59 per cent due to higher prices of food items, government data showed on Wednesday.

In December, the consumer price index (CPI) stood at 7.35 per cent.

Figures released by the Ministry of Statistics and Programme Implementation showed that retail inflation in rural areas was at 7.73 per cent last month and 7.39 per cent in urban areas.

Also read:&nbsp;<a href="https://www.wionews.com/business-economy/indian-markets-witness-fall-on-inflation-data-in-early-trade-telecom-worries-hurt-banks-261952">Indian markets witness fall on inflation data in early trade; telecom worries hurt banks</a>

Inflation in the food basket jumped to 13.63 per cent from 14.12 per cent in December 2019. Inflation in vegetables improved to 50.19 per cent as against 60.50 per cent in December 2019.

Besides, the prices of cereals and products grew at a pace of 5.25 per cent.

The Reserve Bank of India has kept its repo rate unchanged at 5.15 per cent in its February meet despite slowing growth and revised its inflation projections.

The central bank estimates it will range between 5 and 5.4 per cent in the first half of the new fiscal year 2020-21.

Meanwhile, industrial production contracted by 0.3 per cent in December due to a decline in the manufacturing sector against 2.5 per cent growth in the same month year ago.

"The quick estimates of Index of Industrial Production (IIP) with base 2011-12 for the month of December 2019 stands at 133.5, which is 0.3 per cent lower as compared to the level in the month of December 2018," according to an official statement.

Electricity generation dipped by 0.1 per cent as against a growth of 4.5 per cent in December 2018 while the mining sector output grew by 5.4 per cent as compared to a contraction of 1 per cent earlier.

"The cumulative growth for the period of April to December 2019 over the corresponding period of the previous year stands at 0.5 per cent," it added

The retail inflation in January accelerated to 7.59 per cent due to higher prices of food items, government data showed on Wednesday. In December, the consumer price index (CPI) stood at 7.

The retail inflation in January accelerated to 7.59 per cent due to higher prices of food items, government data showed on Wednesday. In December, the consumer price index (CPI) stood at 7.35 per cent. Figures released by the Ministry of Statistics and Programme Implementation showed that retail inflation in rural areas was at 7.73 per cent last month and 7.39 per cent in urban areas. Also read: Indian markets witness fall on inflation data in early trade; telecom worries hurt banks Inflation in the food basket jumped to 13.63 per cent from 14.12 per cent in December 2019. Inflation in vegetables improved to 50.19 per cent as against 60.50 per cent in December 2019. Besides, the prices of cereals and products grew at a pace of 5.25 per cent. The Reserve Bank of India has kept its repo rate unchanged at 5.15 per cent in its February meet despite slowing growth and revised its inflation projections. The central bank estimates it will range between 5 and 5.4 per cent in the first half of the new fiscal year 2020-21. Meanwhile, industrial production contracted by 0.3 per cent in December due to a decline in the manufacturing sector against 2.5 per cent growth in the same month year ago. "The quick estimates of Index of Industrial Production (IIP) with base 2011-12 for the month of December 2019 stands at 133.5, which is 0.3 per cent lower as compared to the level in the month of December 2018," according to an official statement. Electricity generation dipped by 0.1 per cent as against a growth of 4.5 per cent in December 2018 while the mining sector output grew by 5.4 per cent as compared to a contraction of 1 per cent earlier. "The cumulative growth for the period of April to December 2019 over the corresponding period of the previous year stands at 0.5 per cent," it added

India's January inflation rises to 7.59 per cent

<a href="https://www.wionews.com/india-news/caa-row-muslim-leaders-clerics-to-meet-pm-modi-amit-shah-270594">Prime Minister Narendra Modi</a> on Sunday urged the people to come together and take up the task of providing health services to the poor and make efforts to uplift them in the society.

"All of us study in myriad colleges, universities, and schools. But after completing studies, alumni meets are joyous occasions. If this union comprises a shared purpose, a resolve, an emotional connect, it lends additional hues to the event," said Prime Minister Modi in his monthly radio programme <a href="https://www.wionews.com/india-news/mann-ki-baat-pm-modi-announces-launch-of-fit-india-school-rankings-264257">'Mann Ki Baat'</a>.

"I wish to present before you a special occasion. Just recently, I came across in the media a story on the Bhairavganj Health Centre in West Champaran district of Bihar&nbsp;At this Bhairavganj Health Centre, thousands of people from neighbouring villages converged for a free health check-up. This was not a government programme nor was it a government initiative. This was a step taken as part of an alumni meet organised by former students of the local KR High School. They named it Sankalp 95. Sankalp 95 means the resolve undertaken by the 1995 batch of that high school."

Also Watch:&nbsp;Mann Ki Baat-&nbsp;60th episode of PM Modi's monthly radio programme

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In a bid to motivate the listeners, the Prime Minister also gave an example of another group from Bihar, who undertook a task of health care delivery.&nbsp;

He also talked about the women group in Phulpur, who aligned with the self-help group of Kadipur, joined in learning the skill of making slippers to come out of poverty.

"These women of Phulpur were hampered by financial constraints and poverty, but they had the resolve to do something for their families and society. I especially congratulate the local police and their families, who encouraged these women entrepreneurs by purchasing slippers for themselves and their families made by these women."

Prime Minister Narendra Modi on Sunday urged the people to come together and take up the task of providing health services to the poor and make efforts to uplift them in the society.

Prime Minister Narendra Modi on Sunday urged the people to come together and take up the task of providing health services to the poor and make efforts to uplift them in the society. "All of us study in myriad colleges, universities, and schools. But after completing studies, alumni meets are joyous occasions. If this union comprises a shared purpose, a resolve, an emotional connect, it lends additional hues to the event," said Prime Minister Modi in his monthly radio programme 'Mann Ki Baat'. "I wish to present before you a special occasion. Just recently, I came across in the media a story on the Bhairavganj Health Centre in West Champaran district of Bihar At this Bhairavganj Health Centre, thousands of people from neighbouring villages converged for a free health check-up. This was not a government programme nor was it a government initiative. This was a step taken as part of an alumni meet organised by former students of the local KR High School. They named it Sankalp 95. Sankalp 95 means the resolve undertaken by the 1995 batch of that high school." Also Watch: Mann Ki Baat- 60th episode of PM Modi's monthly radio programme × In a bid to motivate the listeners, the Prime Minister also gave an example of another group from Bihar, who undertook a task of health care delivery. He also talked about the women group in Phulpur, who aligned with the self-help group of Kadipur, joined in learning the skill of making slippers to come out of poverty. "These women of Phulpur were hampered by financial constraints and poverty, but they had the resolve to do something for their families and society. I especially congratulate the local police and their families, who encouraged these women entrepreneurs by purchasing slippers for themselves and their families made by these women."

Mann Ki Baat: Prime Minister Modi urges people to take up task to uplift poor

Equity benchmark indices were buoyant during early hours on Friday in line with Asian markets as investors hoped that the <a href="https://www.wionews.com/world/trump-says-he-and-xi-jinping-will-sign-china-trade-deal-270340">US-China trade deal</a> will soon be signed.

At 10:15 am, the <a href="https://www.wionews.com/business-economy/sensex-falls-by-298-points-psu-banks-underperform-270367">BSE S&amp;P Sensex</a> was up by 195 points to 41,359 while the Nifty 50 edged higher by 54 points at 12,181.

Apart from Nifty IT and metal, all sectoral indices at the National Stock Exchange were in the green. Nifty PSU bank jumped by 2.62 per cent. Nifty financial service gained by half per cent while auto ticked up by 0.6 per cent.

Among stocks, State Bank of India rose by 2.12 per cent to Rs 336.85 per share while Yes Bank and Axis Bank moved up by 1.3 per cent and 1.1 per cent respectively. Index heavyweight Reliance Industries jumped by 1.2 per cent to Rs 1,533.70 per share.

The other prominent gainers were Zee Entertainment, Power Grid Corporation, Cipla, <a href="https://www.wionews.com/india-news/were-following-government-order-bharti-airtel-chairman-on-blocking-telecom-services-in-parts-of-delhi-269152">Bharti Airtel</a>, Adani Ports and UPL.

However, JSW Steel and Tata Steel traded with marginal losses like IT majors Tata Consultancy Services, Wipro and HCL Technologies. NTPC, Hindustan Lever and Bajaj Auto too were in the negative terrain.

Meanwhile, Asian shares jumped to an 18-month high as investor optimism was boosted by hopes that the US-China trade deal will soon be signed. Beijing said it is in close contact with Washington about an initial trade agreement.

MSCI`s broadest index of Asia Pacific shares outside Japan was up by 0.55 per cent while Japan`s Nikkei lay flat. <a href="https://www.wionews.com/business-economy/tokyo-stocks-open-slightly-lower-in-muted-trading-270098">Japan</a> has approved a record budget for the coming fiscal year in a bid to shore up growth.

Chinese shares were upbeat after Beijing laid out additional plans to bolster its economy, including infrastructure investments, with blue-chip CSI300 adding 0.56 per cent.

Equity benchmark indices were buoyant during early hours on Friday in line with Asian markets as investors hoped that the US-China trade deal will soon be signed.

Equity benchmark indices were buoyant during early hours on Friday in line with Asian markets as investors hoped that the US-China trade deal will soon be signed. At 10:15 am, the BSE S&P Sensex was up by 195 points to 41,359 while the Nifty 50 edged higher by 54 points at 12,181. Apart from Nifty IT and metal, all sectoral indices at the National Stock Exchange were in the green. Nifty PSU bank jumped by 2.62 per cent. Nifty financial service gained by half per cent while auto ticked up by 0.6 per cent. Among stocks, State Bank of India rose by 2.12 per cent to Rs 336.85 per share while Yes Bank and Axis Bank moved up by 1.3 per cent and 1.1 per cent respectively. Index heavyweight Reliance Industries jumped by 1.2 per cent to Rs 1,533.70 per share. The other prominent gainers were Zee Entertainment, Power Grid Corporation, Cipla, Bharti Airtel, Adani Ports and UPL. However, JSW Steel and Tata Steel traded with marginal losses like IT majors Tata Consultancy Services, Wipro and HCL Technologies. NTPC, Hindustan Lever and Bajaj Auto too were in the negative terrain. Meanwhile, Asian shares jumped to an 18-month high as investor optimism was boosted by hopes that the US-China trade deal will soon be signed. Beijing said it is in close contact with Washington about an initial trade agreement. MSCI`s broadest index of Asia Pacific shares outside Japan was up by 0.55 per cent while Japan`s Nikkei lay flat. Japan has approved a record budget for the coming fiscal year in a bid to shore up growth. Chinese shares were upbeat after Beijing laid out additional plans to bolster its economy, including infrastructure investments, with blue-chip CSI300 adding 0.56 per cent.

Equities trade higher on global cues, PSU banks rally

The <a href="https://www.wionews.com/india-news/maharashtra-upset-over-thackerays-move-400-shiv-sena-workers-join-bjp-266344">Shiv Sena</a> on Tuesday targeted the Bharatiya Janata Party (BJP)-led Centre over the spike in the onion prices and the state of the Indian economy.

In its mouthpiece Saamna, the Sena stated, " At present, the economy is slowing down. But the government is not ready to accept. The prices of onion have reached Rs 200 per kilogram. The Finance Minister has also given a very childish answer on this issue. She said I do not eat onion-garlic, so do not ask me about onions. It seems the Prime Minister has no desire to resolve this issue."

"When Modi was not the <a href="https://www.wionews.com/opinions/economy-debate-narendra-modis-nda-versus-manmohan-singhs-upa-267271">Prime Minister</a> he had expressed concern over the rising prices of onions. While he was the Chief Minister of Gujarat he had stated that onion is a vital vegetable and added that the vegetable should be kept in the locker. Today, his policy has changed. Modi is now the Prime Minister and the economy is collapsing. Earlier, an unconscious person was cured with the smell of the onion. But that it not even possible now as the edible bulb has disappeared from the market," the editorial read.

"Pandit Nehru (Jawaharlal Nehru) and Indira Gandhi cannot be held responsible for the apocalyptic destruction of the country`s economy. The present government is not in a mood to listen to the experts. For them, the economy is like a stock market that has become speculative."

The former ally also raked up the issue of demonetization and said, " Very few people make decisions in the Prime Minister`s Office. These decisions are valid for their political and social programmes of the ruling party. But their decisions have marginalised the economic reforms. While taking decisions, such as demonetization, the Finance Minister of the country was kept in dark and also the Governor of the Reserve Bank of India protested, later he was removed."

The Shiv Sena also slammed the Centre for not doing enough to combat the menace of poverty.

"This time in the Global Hunger Index, out of 107 countries India has been positioned at 102. In 2014, India was in the 55th position and in the last five years, poverty has increased in the country while in the neighboring countries such as Nepal, Bangladesh, <a href="https://www.wionews.com/india-news/kulbhushan-jhadav-case-islamabad-insists-on-pakistan-representative-as-jhadav-gives-indian-side-power-of-attorney-to-represent-him-267156">Pakistan </a>it has reduced. There no work in the hands of the people and no food in their stomach. This is the condition of the common people of our country but the rulers are calling it development. Our economy is sick, but the Modi government is not ready to accept this either."

The Shiv Sena on Tuesday targeted the Bharatiya Janata Party (BJP)-led Centre over the spike in the onion prices and the state of the Indian economy. In its mouthpiece Saamna, the Sena stated, " At present, the economy is slowing down.

The Shiv Sena on Tuesday targeted the Bharatiya Janata Party (BJP)-led Centre over the spike in the onion prices and the state of the Indian economy. In its mouthpiece Saamna, the Sena stated, " At present, the economy is slowing down. But the government is not ready to accept. The prices of onion have reached Rs 200 per kilogram. The Finance Minister has also given a very childish answer on this issue. She said I do not eat onion-garlic, so do not ask me about onions. It seems the Prime Minister has no desire to resolve this issue." "When Modi was not the Prime Minister he had expressed concern over the rising prices of onions. While he was the Chief Minister of Gujarat he had stated that onion is a vital vegetable and added that the vegetable should be kept in the locker. Today, his policy has changed. Modi is now the Prime Minister and the economy is collapsing. Earlier, an unconscious person was cured with the smell of the onion. But that it not even possible now as the edible bulb has disappeared from the market," the editorial read. "Pandit Nehru (Jawaharlal Nehru) and Indira Gandhi cannot be held responsible for the apocalyptic destruction of the country`s economy. The present government is not in a mood to listen to the experts. For them, the economy is like a stock market that has become speculative." The former ally also raked up the issue of demonetization and said, " Very few people make decisions in the Prime Minister`s Office. These decisions are valid for their political and social programmes of the ruling party. But their decisions have marginalised the economic reforms. While taking decisions, such as demonetization, the Finance Minister of the country was kept in dark and also the Governor of the Reserve Bank of India protested, later he was removed." The Shiv Sena also slammed the Centre for not doing enough to combat the menace of poverty. "This time in the Global Hunger Index, out of 107 countries India has been positioned at 102. In 2014, India was in the 55th position and in the last five years, poverty has increased in the country while in the neighboring countries such as Nepal, Bangladesh, Pakistan it has reduced. There no work in the hands of the people and no food in their stomach. This is the condition of the common people of our country but the rulers are calling it development. Our economy is sick, but the Modi government is not ready to accept this either."

Shiv Sena lashes at Modi govt over rising onion prices, state of economy

Five interest rate cuts since the start of the year hasn't stopped India's economy from slowing to its weakest growth rate since 2013, but the&nbsp;Reserve Bank of India&nbsp;is expected to make its sixth cut on Thursday to give what little relief it can.

<a href="https://www.wionews.com/business-economy/indias-q2-gdp-falls-to-45-lowest-in-6-years-265259">Growing by 4.5&nbsp;per cent</a>&nbsp;annually in the June-September quarter, down from 7 per cent&nbsp;a year earlier, the economy is expanding well below the rate needed to generate enough jobs for the millions of younth&nbsp;entering the labour market each month.

The gross domestic product numbers released on Friday showed government spending helping to prop up weak demand, but private investment growth had virtually collapsed, with a crisis in the shadow banking sector causing illiquidity in the economy.

A Reuters poll of 70 economists predicted the RBI would cut its repo rate by 25 basis points (bps) to 4.90 per cent&nbsp;when the monetary policy committee's decision is announced on Thursday, and then by another 15 bps in the second quarter of 2020, where it will stay at least until 2021.

A 25 bps cut would take the cumulative rate cuts by Asia's most aggressive central bank to 160 bps since February and will be the most in a calendar year since 2009.

Madhavi Arora, economist forex and rates at Edelweiss Securities, said the RBI faced "a tough policy dilemma", as economic growth was underperforming, inflation was overshooting, and the government lacked fiscal room to manoeuvre.

She said the latest GDP numbers supported the view in Edelweiss that the RBI will ease "by at least another 50 bps in this cycle, despite an uptick in inflation beyond the 4 per cent&nbsp;comfort zone in the coming months."

Annual retail inflation rose to 4.62 per cent&nbsp;last month, climbing above 4 per cent&nbsp;for the first time in 15 months and up from 3.99 per cent&nbsp;in September.

Analysts believe transient factors were to blame, so the central bank still had room to continue cutting rates.

The September industrial output too contracted 4.3 per cent, following a decline of 1.4 per cent&nbsp;in August.

At its policy review in October, the RBI sharply lowered its growth projection for 2019/20 (April-March) by 80 bps to 6.1 per cent, but most economists expect another downward revision on Thursday.

Rate cuts alone are however expected to do little to revive growth and calls for more direct fiscal stimulus have grown in recent weeks.

A significant minority of economists - 24 of 56 - who answered an additional question in the poll said rate cuts would marginally boost the economy, while nearly a third said they would have little or no impact.

Anagha Deodhar, an economist at ICICI Securities in Mumbai said there was a strong case for an interest rate on Thursday, though monetary policy has limited benefits in the current circumstances.

"Hence, fiscal policy will have to do the heavy-lifting to boost growth. Sector-specific measures and increased government spending could be the quickest way to boost growth in the near term," Deodhar said.

Five interest rate cuts since the start of the year hasn't stopped India's economy from slowing to its weakest growth rate since 2013, but the Reserve Bank of India is expected to make its sixth cut on Thursday to give what little relief it can.

Five interest rate cuts since the start of the year hasn't stopped India's economy from slowing to its weakest growth rate since 2013, but the Reserve Bank of India is expected to make its sixth cut on Thursday to give what little relief it can. Growing by 4.5 per cent annually in the June-September quarter, down from 7 per cent a year earlier, the economy is expanding well below the rate needed to generate enough jobs for the millions of younth entering the labour market each month. The gross domestic product numbers released on Friday showed government spending helping to prop up weak demand, but private investment growth had virtually collapsed, with a crisis in the shadow banking sector causing illiquidity in the economy. A Reuters poll of 70 economists predicted the RBI would cut its repo rate by 25 basis points (bps) to 4.90 per cent when the monetary policy committee's decision is announced on Thursday, and then by another 15 bps in the second quarter of 2020, where it will stay at least until 2021. A 25 bps cut would take the cumulative rate cuts by Asia's most aggressive central bank to 160 bps since February and will be the most in a calendar year since 2009. Madhavi Arora, economist forex and rates at Edelweiss Securities, said the RBI faced "a tough policy dilemma", as economic growth was underperforming, inflation was overshooting, and the government lacked fiscal room to manoeuvre. She said the latest GDP numbers supported the view in Edelweiss that the RBI will ease "by at least another 50 bps in this cycle, despite an uptick in inflation beyond the 4 per cent comfort zone in the coming months." Annual retail inflation rose to 4.62 per cent last month, climbing above 4 per cent for the first time in 15 months and up from 3.99 per cent in September. Analysts believe transient factors were to blame, so the central bank still had room to continue cutting rates. The September industrial output too contracted 4.3 per cent, following a decline of 1.4 per cent in August. At its policy review in October, the RBI sharply lowered its growth projection for 2019/20 (April-March) by 80 bps to 6.1 per cent, but most economists expect another downward revision on Thursday. Rate cuts alone are however expected to do little to revive growth and calls for more direct fiscal stimulus have grown in recent weeks. A significant minority of economists - 24 of 56 - who answered an additional question in the poll said rate cuts would marginally boost the economy, while nearly a third said they would have little or no impact. Anagha Deodhar, an economist at ICICI Securities in Mumbai said there was a strong case for an interest rate on Thursday, though monetary policy has limited benefits in the current circumstances. "Hence, fiscal policy will have to do the heavy-lifting to boost growth. Sector-specific measures and increased government spending could be the quickest way to boost growth in the near term," Deodhar said.

RBI likely to slash interest rates for 6th time on December 5 to support growth

Indian shares inched higher in early trade on Thursday ahead of the expiry of November futures and options, while investors awaited gross domestic product (GDP) data due on Friday for clues about the health of Asia's third-largest economy.

The NSE Nifty 50 index was up 0.1 per cent&nbsp;at 12,111.90 by 0406 GMT, while the S&amp;P BSE Sensex index was higher 0.1 per cent&nbsp;at 41,062.

"We are at a crucial juncture at this point of time. Today's move will decide the future course of action," said Rusmik Oza, head of fundamental research, Kotak Securities.

"If the market closes above 12,100 levels on expiry, then investors are ready to digest the GDP numbers. If they retrace today, then there are chances they might go down tomorrow or after the data."

Indian stocks are set to rise further over the coming year, according to a Reuters poll of equity strategists, but those gains will be limited as fiscal stimulus and easy monetary policy fail to reverse an economic slowdown.

Public sector banks led gains in the Nifty index, with the main sub-index rising 1.15 per cent. Shares of Indian Bank rose 4.52 per cent, while Oriental Bank of Commerce gained 4.1per cent.

Bharti Infratel was the top gainer in the Nifty 50 index, rising 4.7 per cent.

Indian shares inched higher in early trade on Thursday ahead of the expiry of November futures and options, while investors awaited gross domestic product (GDP) data due on Friday for clues about the health of Asia's third-largest economy.

Indian shares inched higher in early trade on Thursday ahead of the expiry of November futures and options, while investors awaited gross domestic product (GDP) data due on Friday for clues about the health of Asia's third-largest economy. The NSE Nifty 50 index was up 0.1 per cent at 12,111.90 by 0406 GMT, while the S&P BSE Sensex index was higher 0.1 per cent at 41,062. "We are at a crucial juncture at this point of time. Today's move will decide the future course of action," said Rusmik Oza, head of fundamental research, Kotak Securities. "If the market closes above 12,100 levels on expiry, then investors are ready to digest the GDP numbers. If they retrace today, then there are chances they might go down tomorrow or after the data." Indian stocks are set to rise further over the coming year, according to a Reuters poll of equity strategists, but those gains will be limited as fiscal stimulus and easy monetary policy fail to reverse an economic slowdown. Public sector banks led gains in the Nifty index, with the main sub-index rising 1.15 per cent. Shares of Indian Bank rose 4.52 per cent, while Oriental Bank of Commerce gained 4.1per cent. Bharti Infratel was the top gainer in the Nifty 50 index, rising 4.7 per cent.

Nifty, Sensex tick up ahead of F&O expiry, GDP data

Indian states face difficulties in reducing deficits, challenging the country's ability to meet medium-term fiscal consolidation goals as economic growth slows, Moody's Investors Service said in a new report released on Wednesday.

"Indian states do not generate sufficient own source revenue to cover their spending needs. The introduction of <a href="https://www.wionews.com/business-economy/gst-revenue-collections-for-june-total-rs-99939-crore-232065">Goods and Services Tax </a>(GST) in 2017 has further increased states' reliance on central government transfers," said Moody's Assistant Vice President and Analyst Gjorgji Josifov.

"As slowing growth and continued infrastructure spending are likely to keep state-level deficits elevated, we expect the central government will continue to face challenges in achieving its fiscal consolidation targets," added Josifov.

The implementation of the GST in July 2017 replaced many indirect taxes levied by the states with centralised GST rates. As a result, states are now more reliant on the central government for revenue, with the central government accounting for almost half their revenue.

Meanwhile, persistent spending pressures and slowing economic growth will keep state-level deficits high at about 3 per cent of GDP for the fiscal year ending March 2020. Coupled with the projected 3.7 per cent deficit for the central government, this will bring the general government deficit to about 6.7 per cent.

Without policy changes, Moody's expects states' deficits to stay around current levels which will continue to challenge general government (combined central and state) fiscal consolidation.

As a percentage of GDP, states' outstanding debt will remain around 25 per cent in fiscal 2019 and 2020. To achieve the Fiscal Responsibility and Budget Management (FRBM) Act baseline scenario of debt-GDP reaching 20 per cent by 2024-25 will require significant expenditure cuts and much higher revenue growth.

Moody's report forms part of its continuing research on the debt and finances of India's states and local governments, and the central government's efforts to reduce deficits and debt.

Indian states face difficulties in reducing deficits, challenging the country's ability to meet medium-term fiscal consolidation goals as economic growth slows, Moody's Investors Service said in a new report released on Wednesday.

Indian states face difficulties in reducing deficits, challenging the country's ability to meet medium-term fiscal consolidation goals as economic growth slows, Moody's Investors Service said in a new report released on Wednesday. "Indian states do not generate sufficient own source revenue to cover their spending needs. The introduction of Goods and Services Tax (GST) in 2017 has further increased states' reliance on central government transfers," said Moody's Assistant Vice President and Analyst Gjorgji Josifov. "As slowing growth and continued infrastructure spending are likely to keep state-level deficits elevated, we expect the central government will continue to face challenges in achieving its fiscal consolidation targets," added Josifov. The implementation of the GST in July 2017 replaced many indirect taxes levied by the states with centralised GST rates. As a result, states are now more reliant on the central government for revenue, with the central government accounting for almost half their revenue. Meanwhile, persistent spending pressures and slowing economic growth will keep state-level deficits high at about 3 per cent of GDP for the fiscal year ending March 2020. Coupled with the projected 3.7 per cent deficit for the central government, this will bring the general government deficit to about 6.7 per cent. Without policy changes, Moody's expects states' deficits to stay around current levels which will continue to challenge general government (combined central and state) fiscal consolidation. As a percentage of GDP, states' outstanding debt will remain around 25 per cent in fiscal 2019 and 2020. To achieve the Fiscal Responsibility and Budget Management (FRBM) Act baseline scenario of debt-GDP reaching 20 per cent by 2024-25 will require significant expenditure cuts and much higher revenue growth. Moody's report forms part of its continuing research on the debt and finances of India's states and local governments, and the central government's efforts to reduce deficits and debt.

Indian states face challenges in reducing deficits, constraining government fiscal consolidation: Report

Indian shares rose on Monday, led by metals and real estate stocks, while gains in broader Asia on hopes of progress in the <a href="https://www.wionews.com/world/no-phase-two-us-china-deal-on-the-horizon-officials-say-264312">US-China trade talks</a> also boosted sentiment.

The NSE Nifty 50 index rose 0.3 per cent&nbsp;at 11,946.90, while the S&amp;P BSE&nbsp;Sensex&nbsp;was up 0.27 per cent&nbsp;at 40,472.53.

MSCI's broadest index of Asia-Pacific shares outside Japan bounced 0.8 per cent&nbsp;after US&nbsp;national security adviser Robert O'Brien on Saturday said an initial trade agreement with China was still possible by the end of the year.

O'Brien, however, warned Washington would not turn a blind eye to what happens in Hong Kong, which added to worries that a Chinese crackdown on anti-government protests in Hong Kong could further complicate the talks.

In the domestic markets, the Nifty Metals index rose about 1.6 per cent, while the Nifty Realty index advanced 1.8 per cent&nbsp;in early trading.

Steelmakers JSW Steel and Tata Steel were the top gainers on the Nifty, rising about 2.5 per cent&nbsp;each, after prices of metals rose on positive signals from Washington on China.

Zee Entertainment lost 2.69 per cent&nbsp;and was the top loser on the Nifty.

Indian shares rose on Monday, led by metals and real estate stocks, while gains in broader Asia on hopes of progress in the US-China trade talks also boosted sentiment.

Indian shares rose on Monday, led by metals and real estate stocks, while gains in broader Asia on hopes of progress in the US-China trade talks also boosted sentiment. The NSE Nifty 50 index rose 0.3 per cent at 11,946.90, while the S&P BSE Sensex was up 0.27 per cent at 40,472.53. MSCI's broadest index of Asia-Pacific shares outside Japan bounced 0.8 per cent after US national security adviser Robert O'Brien on Saturday said an initial trade agreement with China was still possible by the end of the year. O'Brien, however, warned Washington would not turn a blind eye to what happens in Hong Kong, which added to worries that a Chinese crackdown on anti-government protests in Hong Kong could further complicate the talks. In the domestic markets, the Nifty Metals index rose about 1.6 per cent, while the Nifty Realty index advanced 1.8 per cent in early trading. Steelmakers JSW Steel and Tata Steel were the top gainers on the Nifty, rising about 2.5 per cent each, after prices of metals rose on positive signals from Washington on China. Zee Entertainment lost 2.69 per cent and was the top loser on the Nifty.

Sensex, Nifty track broader Asia higher; metal stocks gain

India's urban unemployment rate between January and March this year was 9.3 per cent, the lowest in at least four quarters, according to an unpublished government report reviewed by Reuters.

The numbers, recorded in the statistics ministry's quarterly jobs report, could provide some relief to <a href="https://www.wionews.com/india-news/prime-minister-narendra-modi-to-address-conclave-of-accountants-in-delhi-today-263523">Prime Minister Narendra Modi</a> who has faced criticism for not being able to create enough jobs amid slowing economic growth.

The urban unemployment rate of the January-March quarter compared with 9.9 per cent&nbsp;in the preceding quarter. Quarterly data prior to the April-June 2018 survey period is not available and the January-March quarter's rate is the lowest since then.

The report, which is likely to be published soon, did not assess rural unemployment.

The estimates were arrived as using the so-called "current weekly status" method which gives an average picture of unemployment in a short period of seven days preceding the survey period, the document said. A person is considered as unemployed in a week if he did not work even for 1 hour during that week.

Joblessness among the youth,&nbsp;those aged between 15-29 years and who account for roughly over a third of India's 1.3 billion people - was also marginally lower at 22.5 per cent&nbsp;in the quarter ending March 2019, from 23.7 per cent&nbsp;in the preceding quarter.

India's urban unemployment rate between January and March this year was 9.3 per cent, the lowest in at least four quarters, according to an unpublished government report reviewed by Reuters.

India's urban unemployment rate between January and March this year was 9.3 per cent, the lowest in at least four quarters, according to an unpublished government report reviewed by Reuters. The numbers, recorded in the statistics ministry's quarterly jobs report, could provide some relief to Prime Minister Narendra Modi who has faced criticism for not being able to create enough jobs amid slowing economic growth. The urban unemployment rate of the January-March quarter compared with 9.9 per cent in the preceding quarter. Quarterly data prior to the April-June 2018 survey period is not available and the January-March quarter's rate is the lowest since then. The report, which is likely to be published soon, did not assess rural unemployment. The estimates were arrived as using the so-called "current weekly status" method which gives an average picture of unemployment in a short period of seven days preceding the survey period, the document said. A person is considered as unemployed in a week if he did not work even for 1 hour during that week. Joblessness among the youth, those aged between 15-29 years and who account for roughly over a third of India's 1.3 billion people - was also marginally lower at 22.5 per cent in the quarter ending March 2019, from 23.7 per cent in the preceding quarter.

India's urban unemployment rate slows in March 2019 quarter: Government data

Indian shares inched higher on Tuesday, driven by banking and telecom stocks after two major mobile network service providers said they planned to raise tariffs from next month.

The NSE Nifty 50 index rose 0.2 per cent&nbsp;to 11,906.25, while the S&amp;P BSE Sensex gained 0.4 per cent&nbsp;to 40,455.36.

"Markets are in a consolidation phase after the recent rally," said A.K Prabhakar, head of research at IDBI Capital.

The Nifty main index has risen over 12 per cent&nbsp;since hitting a six-month low mid-August, supported by government measures to boost investor confidence as Asia's third-largest economy faces slowdown.

Tariff hike announcements by telecom companies will benefit banks as they have a huge exposure to the sector, Prabhakar said.

On Monday, Bharti <a href="https://www.wionews.com/business-economy/airtel-vodafone-idea-shares-jump-after-on-hopes-of-govt-help-262309">Airtel and Vodafone</a> Idea said they would increase mobile tariffs from December, after posting record quarterly losses.

Airtel shares rose 4.8 per cent&nbsp;and were among the top gainers in the Nifty index, while Vodafone shares jumped 18 per cent.

Banking and IT stocks led gains, rising 0.2 per cent&nbsp;to 0.4 per cent.

The Nifty has an immediate support in the range of 11,700-11,800, said Amit&nbsp;Shah, technical research analyst with Indiabulls Ventures, in a note.

The index is poised to hit an all-time high above the 12,100 zone, Shah added.

Indian shares inched higher on Tuesday, driven by banking and telecom stocks after two major mobile network service providers said they planned to raise tariffs from next month.

Indian shares inched higher on Tuesday, driven by banking and telecom stocks after two major mobile network service providers said they planned to raise tariffs from next month. The NSE Nifty 50 index rose 0.2 per cent to 11,906.25, while the S&P BSE Sensex gained 0.4 per cent to 40,455.36. "Markets are in a consolidation phase after the recent rally," said A.K Prabhakar, head of research at IDBI Capital. The Nifty main index has risen over 12 per cent since hitting a six-month low mid-August, supported by government measures to boost investor confidence as Asia's third-largest economy faces slowdown. Tariff hike announcements by telecom companies will benefit banks as they have a huge exposure to the sector, Prabhakar said. On Monday, Bharti Airtel and Vodafone Idea said they would increase mobile tariffs from December, after posting record quarterly losses. Airtel shares rose 4.8 per cent and were among the top gainers in the Nifty index, while Vodafone shares jumped 18 per cent. Banking and IT stocks led gains, rising 0.2 per cent to 0.4 per cent. The Nifty has an immediate support in the range of 11,700-11,800, said Amit Shah, technical research analyst with Indiabulls Ventures, in a note. The index is poised to hit an all-time high above the 12,100 zone, Shah added.

Nifty, Sensex edge higher; bank, telecom stocks gain

Indian shares edged higher on Monday, driven mostly by a surge in banking stocks after the top court last week provided relief to lenders in a case related to a steel company and on hopes of more support from the government towards ailing sectors.

The Supreme Court on Friday cleared the path for steelmaker <a href="https://www.wionews.com/business-economy/supreme-court-clears-path-for-arcelormittal-to-acquire-essar-steel-262263">ArcelorMittal SA to take over</a> bankrupt Essar Steel, and the judgment comes as a big reprieve for banks which are struggling with bad loans worth $140 billion.

"The Essar Steel verdict is very positive for the banking sector. Also, the banking sector results have been marginally better than expected," said Vinod Nair, head of research at Geojit Financial Services.

The government is coming up with positive measures to help the economy and ailing sectors like telecom, boosting investor confidence, he added.

The finance minister said on Friday the government was discussing the issue around telecom companies, but no final call had been taken yet.

This comes after India's two top mobile carriers warned last week that their ability to operate and make profits would depend on relief from the government.

The NSE Nifty 50 index was up 0.1 per cent&nbsp;at 11,903 as of 0410 GMT, while the S&amp;P BSE&nbsp;Sensex&nbsp;was 0.3 per cent&nbsp;higher at 40,495.

The Nifty public sector bank index was the top gainer, rising 1.4 per cent. State Bank of India led the rally with a rise of 1.8 per cent.

Indian shares edged higher on Monday, driven mostly by a surge in banking stocks after the top court last week provided relief to lenders in a case related to a steel company and on hopes of more support from the government towards ailing sectors.

Indian shares edged higher on Monday, driven mostly by a surge in banking stocks after the top court last week provided relief to lenders in a case related to a steel company and on hopes of more support from the government towards ailing sectors. The Supreme Court on Friday cleared the path for steelmaker ArcelorMittal SA to take over bankrupt Essar Steel, and the judgment comes as a big reprieve for banks which are struggling with bad loans worth $140 billion. "The Essar Steel verdict is very positive for the banking sector. Also, the banking sector results have been marginally better than expected," said Vinod Nair, head of research at Geojit Financial Services. The government is coming up with positive measures to help the economy and ailing sectors like telecom, boosting investor confidence, he added. The finance minister said on Friday the government was discussing the issue around telecom companies, but no final call had been taken yet. This comes after India's two top mobile carriers warned last week that their ability to operate and make profits would depend on relief from the government. The NSE Nifty 50 index was up 0.1 per cent at 11,903 as of 0410 GMT, while the S&P BSE Sensex was 0.3 per cent higher at 40,495. The Nifty public sector bank index was the top gainer, rising 1.4 per cent. State Bank of India led the rally with a rise of 1.8 per cent.

Nifty, Sensex tick up; Public sector banks lead gains

While Prime Minister Narendra Modi has set the target of five trillion dollar economy by 2024, Defence Minister Rajnath Singh said that with the talent India possesses, in 10-15 years we will become 10 trillion dollar economy.

"Prime Minister Modi has set 5 trillion dollar economy target by 2024 but I feel that with the talent we have, in 10-15 years we will make it a 10 trillion dollar economy," Singh said at the `Def-Connect` event here.

Last month, Singh had called for increased and active participation of the private sector in defence manufacturing to achieve the government`s target of making the Indian defence industry worth $26 billion by 2025.

"Defence sector will play a pivotal role in the government`s aim of inclusive growth and making India a $5 trillion economy. Our aim is to make a world-class domestic defence industry that is self-reliant and less dependent on imports," he said while addressing the captains of industry at the 22nd India International Security Expo, 2019 (Defence &amp; Homeland Security).

While Prime Minister Narendra Modi has set the target of five trillion dollar economy by 2024, Defence Minister Rajnath Singh said that with the talent India possesses, in 10-15 years we will become 10 trillion dollar economy.

While Prime Minister Narendra Modi has set the target of five trillion dollar economy by 2024, Defence Minister Rajnath Singh said that with the talent India possesses, in 10-15 years we will become 10 trillion dollar economy. "Prime Minister Modi has set 5 trillion dollar economy target by 2024 but I feel that with the talent we have, in 10-15 years we will make it a 10 trillion dollar economy," Singh said at the `Def-Connect` event here. Last month, Singh had called for increased and active participation of the private sector in defence manufacturing to achieve the government`s target of making the Indian defence industry worth $26 billion by 2025. "Defence sector will play a pivotal role in the government`s aim of inclusive growth and making India a $5 trillion economy. Our aim is to make a world-class domestic defence industry that is self-reliant and less dependent on imports," he said while addressing the captains of industry at the 22nd India International Security Expo, 2019 (Defence & Homeland Security).

India will become USD 10 trillion economy in 10-15 years: Rajnath Singh

India's power demand fell 13.2 per cent&nbsp;in October from a year ago, posting its steepest monthly decline in over 12 years, government data showed, reflecting a deepening growth slowdown in Asia's third-largest economy.

The country needs electricity to fuel its expanding economy but a&nbsp;third decline in power consumption in as many months points to tapering industrial activity in the nation that aims to become a $5 trillion economy by 2024.

India's June quarter GDP grew at its weakest pace in six years as consumer demand and government spending slowed, and economists see the falling electricity demand as a reflection of a further slowdown.

"The slowdown seems to be deep-rooted, especially in the industrial sector. That would certainly increase the anxiety with regard to growth prospects in the current year," said N.R. Bhanumurthy, a professor at the National Institute of Public Finance and Policy in New Delhi.

Consumption in heavily industrialized states such as Maharashtra and Gujarat led the decline. Last month, power demand in Maharashtra declined by 22.4 per cent&nbsp;and in Gujarat by 18.8 per cent, the data from the Central Electricity Authority (CEA) showed. Barring four small states in the country's north and the east, demand fell across regions, the data showed.

India's infrastructure output in September contracted 5.2 per cent, the worst in 14 years, adding to the worries of the government that has been unable to revive demand in the economy despite several steps in the last few months.

Its fuel demand growth - also seen by economists as an indicator of economic activity - is on track for the slowest pace in six years.

Economists said India's growth could fall as low as 5.8 per cent, dragged down by a slump in consumer demand and investment. India's central bank last month cut its growth forecast by 80 basis points for the year ending March 2020 to 6.1 per cent.

Slower economic activity has resulted in a fall in sales of everything from cars to cookies, with some large scale industries resorting to large job cuts.

India's automobile sector, for instance, has cut hundreds of thousands of jobs, citing an unprecedented decline in sales.

"Now we are talking about a sub 6 per cent&nbsp;growth for the current fiscal year," Bhanumurthy told Reuters.

The government, which has not revised its growth forecast of 7 per cent&nbsp;for the financial year, is expected to release data on economic growth by the end of this month. Information on electricity demand prior to January 2006 is not publicly available.

Populous states such as Uttar Pradesh (UP) and Madhya Pradesh (MP) saw demand fall - with MP's electricity requirement falling by over a fourth and UP seeing a decline of 8.3 per cent.

India's power demand fell 13.2 per cent in October from a year ago, posting its steepest monthly decline in over 12 years, government data showed, reflecting a deepening growth slowdown in Asia's third-largest economy.

India's power demand fell 13.2 per cent in October from a year ago, posting its steepest monthly decline in over 12 years, government data showed, reflecting a deepening growth slowdown in Asia's third-largest economy. The country needs electricity to fuel its expanding economy but a third decline in power consumption in as many months points to tapering industrial activity in the nation that aims to become a $5 trillion economy by 2024. India's June quarter GDP grew at its weakest pace in six years as consumer demand and government spending slowed, and economists see the falling electricity demand as a reflection of a further slowdown. "The slowdown seems to be deep-rooted, especially in the industrial sector. That would certainly increase the anxiety with regard to growth prospects in the current year," said N.R. Bhanumurthy, a professor at the National Institute of Public Finance and Policy in New Delhi. Consumption in heavily industrialized states such as Maharashtra and Gujarat led the decline. Last month, power demand in Maharashtra declined by 22.4 per cent and in Gujarat by 18.8 per cent, the data from the Central Electricity Authority (CEA) showed. Barring four small states in the country's north and the east, demand fell across regions, the data showed. India's infrastructure output in September contracted 5.2 per cent, the worst in 14 years, adding to the worries of the government that has been unable to revive demand in the economy despite several steps in the last few months. Its fuel demand growth - also seen by economists as an indicator of economic activity - is on track for the slowest pace in six years. Economists said India's growth could fall as low as 5.8 per cent, dragged down by a slump in consumer demand and investment. India's central bank last month cut its growth forecast by 80 basis points for the year ending March 2020 to 6.1 per cent. Slower economic activity has resulted in a fall in sales of everything from cars to cookies, with some large scale industries resorting to large job cuts. India's automobile sector, for instance, has cut hundreds of thousands of jobs, citing an unprecedented decline in sales. "Now we are talking about a sub 6 per cent growth for the current fiscal year," Bhanumurthy told Reuters. The government, which has not revised its growth forecast of 7 per cent for the financial year, is expected to release data on economic growth by the end of this month. Information on electricity demand prior to January 2006 is not publicly available. Populous states such as Uttar Pradesh (UP) and Madhya Pradesh (MP) saw demand fall - with MP's electricity requirement falling by over a fourth and UP seeing a decline of 8.3 per cent.

India's electricity demand falls at fastest pace in at least 12 years

By Mallika Singh

India on Monday <a href="https://www.wionews.com/videos/asean-summit-india-decides-not-to-join-rcep-259919">pulled out of</a> the proposed Regional Comprehensive Economic Partnership (RCEP) stating that the agreement “does not satisfactorily address India's outstanding issues and concerns.” 
&nbsp; 
Prime Minister Modi, while speaking at the Association of Southeast Asian Nations (ASEAN) summit in Thailand said that “neither the Talisman of Gandhiji nor my own conscience permits me to join the RCEP.” 
&nbsp; 
RCEP is a proposed Free Trade Agreement (FTA) that was being negotiated between 16 countries - the 10 member states of ASEAN along with India, Australia, China, Korea, Japan, and New Zealand. 
&nbsp; 
While the exact details of what the agreement entails are yet to be released, its aim, as established in 2012 in Cambodia, was to increase trade by decreasing tariffs and barriers between member states, boost exports, and create an alternative market for investment. 
&nbsp; 
India chose to withhold from joining the trade agreement due to “significant outstanding issues, which remain unresolved”.

"The present form of the RCEP agreement does not fully reflect the basic spirit and the agreed guiding principles of RCEP,” Prime Minister <a href="https://www.wionews.com/india-news/india-not-to-join-rcep-goes-against-countrys-core-interests-259904">Narendra Modi </a>said.

New Delhi’s stand on data localisation is one of the key issues at conflict as RCEP norms support the free flow of data which hampers India’s digital sovereignty. &nbsp;

According to NITI Aayog, the policy think tank of India, the country has a growing trade deficit with ASEAN member states and China. Participating in RCEP would have only widened these deficits. 
&nbsp; 
With the ongoing United States-China trade war, signing the trade agreement would have interfered with India's attempt to augment its ties with the United States.

China’s dumping policy also presented itself as a potential threat to India, where access to an open market might have lead China to dump its products in regional Indian markets. &nbsp;

India felt that there was “inadequate” protection provided to its domestic markets which would have had to suffer losses as cheaper products from China threatened to “flood” Indian markets.

The dairy industry was also expected to face the burden of the trade deal due to the introduction of competition from New Zealand and Australia.

India also failed to receive any assurance on its demand for greater market access and concerns over non-tariff barriers as China has in the past used these to curtail India’s exports to the country.

India expressed dismay at 2014 being set as the base year for tariff reductions instead of 2013. This would have gone against the country's interests as several import duties have gone up since 2014. 
&nbsp; 
RCEP is supposed to be one of the world’s largest trade pacts and the largest regional trading agreement yet. The member countries account for half of the world’s population and almost one-third of the Global Gross Domestic Product.

Becoming a member of the RCEP would have provided New Delhi with an alternative market, reducing its dependence on Western nation-states, an increase in export-oriented Foreign Direct Investment (FDI), and a boost to its service sector.

Although India currently backed out of one of the biggest free trade deals in the world, the remaining 15 members agreed on the negotiated terms and will be signing it next year. 
&nbsp;

By Mallika Singh India on Monday pulled out of the proposed Regional Comprehensive Economic Partnership (RCEP) stating that the agreement “does not satisfactorily address India's outstanding issues and concerns.

By Mallika Singh India on Monday pulled out of the proposed Regional Comprehensive Economic Partnership (RCEP) stating that the agreement “does not satisfactorily address India's outstanding issues and concerns.” Prime Minister Modi, while speaking at the Association of Southeast Asian Nations (ASEAN) summit in Thailand said that “neither the Talisman of Gandhiji nor my own conscience permits me to join the RCEP.” RCEP is a proposed Free Trade Agreement (FTA) that was being negotiated between 16 countries - the 10 member states of ASEAN along with India, Australia, China, Korea, Japan, and New Zealand. While the exact details of what the agreement entails are yet to be released, its aim, as established in 2012 in Cambodia, was to increase trade by decreasing tariffs and barriers between member states, boost exports, and create an alternative market for investment. India chose to withhold from joining the trade agreement due to “significant outstanding issues, which remain unresolved”. "The present form of the RCEP agreement does not fully reflect the basic spirit and the agreed guiding principles of RCEP,” Prime Minister Narendra Modi said. New Delhi’s stand on data localisation is one of the key issues at conflict as RCEP norms support the free flow of data which hampers India’s digital sovereignty. According to NITI Aayog, the policy think tank of India, the country has a growing trade deficit with ASEAN member states and China. Participating in RCEP would have only widened these deficits. With the ongoing United States-China trade war, signing the trade agreement would have interfered with India's attempt to augment its ties with the United States. China’s dumping policy also presented itself as a potential threat to India, where access to an open market might have lead China to dump its products in regional Indian markets. India felt that there was “inadequate” protection provided to its domestic markets which would have had to suffer losses as cheaper products from China threatened to “flood” Indian markets. The dairy industry was also expected to face the burden of the trade deal due to the introduction of competition from New Zealand and Australia. India also failed to receive any assurance on its demand for greater market access and concerns over non-tariff barriers as China has in the past used these to curtail India’s exports to the country. India expressed dismay at 2014 being set as the base year for tariff reductions instead of 2013. This would have gone against the country's interests as several import duties have gone up since 2014. RCEP is supposed to be one of the world’s largest trade pacts and the largest regional trading agreement yet. The member countries account for half of the world’s population and almost one-third of the Global Gross Domestic Product. Becoming a member of the RCEP would have provided New Delhi with an alternative market, reducing its dependence on Western nation-states, an increase in export-oriented Foreign Direct Investment (FDI), and a boost to its service sector. Although India currently backed out of one of the biggest free trade deals in the world, the remaining 15 members agreed on the negotiated terms and will be signing it next year.

RCEP pull-out: India stands by reduced trade deficits, data localisation, and enhancing domestic markets

Two- and three-wheeler manufacturer Bajaj Auto on Friday said that it sold 4.63 lakh vehicles in October, down 9 per cent in the year-ago period.

In October 2018, it had sold 5.06 lakh units, it said in a statement.

Domestic sales of motorcycles fell by 14 per cent to 2.42 lakh units from 2.81 lakh in October last year. But exports rose by 3 per cent to 1.56 lakh units from 1.51 lakh.

For the April to October period, motorcycle sales work out to 13.74 lakh units in the domestic market, down 12 per cent from 15.68 lakh units, and 10.9 lakh units in export markets, up 7 per cent from 10.2 lakh units year-on-year.

In commercial vehicles, domestic sales slipped by 5 per cent to 36,260 units last month from 38,360 in October last year.

Exports too fell by 21 per cent to 28,035 units from 35,354 units.

For the April to October period, domestic sales totalled 2.3 lakh units, down 6 per cent from 2.4 lakh units, while exports dropped by 21 per cent to 1.87 lakh units from 2.38 lakh units year-on-year.

Two- and three-wheeler manufacturer Bajaj Auto on Friday said that it sold 4.63 lakh vehicles in October, down 9 per cent in the year-ago period. In October 2018, it had sold 5.

Two- and three-wheeler manufacturer Bajaj Auto on Friday said that it sold 4.63 lakh vehicles in October, down 9 per cent in the year-ago period. In October 2018, it had sold 5.06 lakh units, it said in a statement. Domestic sales of motorcycles fell by 14 per cent to 2.42 lakh units from 2.81 lakh in October last year. But exports rose by 3 per cent to 1.56 lakh units from 1.51 lakh. For the April to October period, motorcycle sales work out to 13.74 lakh units in the domestic market, down 12 per cent from 15.68 lakh units, and 10.9 lakh units in export markets, up 7 per cent from 10.2 lakh units year-on-year. In commercial vehicles, domestic sales slipped by 5 per cent to 36,260 units last month from 38,360 in October last year. Exports too fell by 21 per cent to 28,035 units from 35,354 units. For the April to October period, domestic sales totalled 2.3 lakh units, down 6 per cent from 2.4 lakh units, while exports dropped by 21 per cent to 1.87 lakh units from 2.38 lakh units year-on-year.

Bajaj Auto reports 9% fall in vehicle sales during October

Indian shares extended gains seen through the week on Friday, as a raft of strong earnings raised expectations of a better December quarter.

Broader Asian shares reversed early losses with MSCI`s broadest index of Asia-Pacific shares outside Japan inching up 0.16 per cent&nbsp;after a surprise bounce in Chinese manufacturing activity boosted investor sentiment.

In domestic markets, the broader NSE index&nbsp;was up 0.23 per cent&nbsp;at 11,904.05 as of 0405 GMT, while the benchmark BSE index&nbsp;was 0.25 per cent&nbsp;higher at 40,219.86.

Indian shares have seen steady gains in the last few sessions buoyed by positive global cues, a strong set of corporate results and expectations of a better third quarter.

The Nifty Media index&nbsp;rose as much as 3.49 per cent, gaining the most among the 14 sectoral NSE indexes.

The Nifty PSU Bank index, which tracks the country`s state-run lenders, rose as much as 0.83 per cent, with shares of Central Bank of India rising nearly 6 per cent.

"Today is the first day of the new derivative segment and we have had one of the best months in the last four months, so that positivity has continued," said A.K. Prabhakar, head of research at IDBI Capital in Mumbai.

Auto stocks will be in focus on Friday as automakers are set to report their monthly sales data. The Nifty Auto index&nbsp;inched up 0.24 per cent&nbsp;in early trade.

Shares of lender Yes Bank Ltd were flat ahead of quarterly results announcement.

State-owned oil retailer<a href="https://www.wionews.com/business-economy/indian-oil-profit-tanks-83-as-refining-margins-shrink-259071"> Indian Oil Corporation</a> Ltd slipped as much as 4.22 per cent&nbsp;and was the biggest loser on the NSE index after the refiner recorded an 83 per cent&nbsp;slide in quarterly profit.

Meanwhile, India`s fiscal deficit in the six months through September approached 93 per cent&nbsp;of the target for the full year, limiting the scope for Prime Minister Narendra Modi to consider more tax cuts to boost economic growth.

Indian shares extended gains seen through the week on Friday, as a raft of strong earnings raised expectations of a better December quarter. Broader Asian shares reversed early losses with MSCI`s broadest index of Asia-Pacific shares outside Japan inching up 0.

Indian shares extended gains seen through the week on Friday, as a raft of strong earnings raised expectations of a better December quarter. Broader Asian shares reversed early losses with MSCI`s broadest index of Asia-Pacific shares outside Japan inching up 0.16 per cent after a surprise bounce in Chinese manufacturing activity boosted investor sentiment. In domestic markets, the broader NSE index was up 0.23 per cent at 11,904.05 as of 0405 GMT, while the benchmark BSE index was 0.25 per cent higher at 40,219.86. Indian shares have seen steady gains in the last few sessions buoyed by positive global cues, a strong set of corporate results and expectations of a better third quarter. The Nifty Media index rose as much as 3.49 per cent, gaining the most among the 14 sectoral NSE indexes. The Nifty PSU Bank index, which tracks the country`s state-run lenders, rose as much as 0.83 per cent, with shares of Central Bank of India rising nearly 6 per cent. "Today is the first day of the new derivative segment and we have had one of the best months in the last four months, so that positivity has continued," said A.K. Prabhakar, head of research at IDBI Capital in Mumbai. Auto stocks will be in focus on Friday as automakers are set to report their monthly sales data. The Nifty Auto index inched up 0.24 per cent in early trade. Shares of lender Yes Bank Ltd were flat ahead of quarterly results announcement. State-owned oil retailer Indian Oil Corporation Ltd slipped as much as 4.22 per cent and was the biggest loser on the NSE index after the refiner recorded an 83 per cent slide in quarterly profit. Meanwhile, India`s fiscal deficit in the six months through September approached 93 per cent of the target for the full year, limiting the scope for Prime Minister Narendra Modi to consider more tax cuts to boost economic growth.

Nifty, Sensex extend gains, Indian Oil Corporation drops after weak results

Maruti Suzuki India on Friday reported 4.5 per cent growth year-on-year in October sales led by compact and utility vehicle segments.

Driven by the festive season and heavy discounts, the company sold 1.53 lakh units during the month against 1.46 lakh units sold in the same month of last year.

The country`s largest car manufacturer said domestic sales in October grew by 4.5 per cent year-on-year to 1.44 lakh units from 1.38 lakh units and exports increased 5.7 per cent to 9,158 units from 8,666 units.

Passenger car sales were up by 4.4 per cent to 1.06 lakh units compared to 1.01 lakh units in October last year.

The compact car segment (new WagonR, Celerio, Ignis, Swift, Baleno and Dzire) clocked 15.9 per cent growth but mini segment (Alto, S-Presso and old WagonR) showed 13.1 per cent decline.

Utility vehicles sales (Gypsy, Ertiga, XL6, Vitara Brezza and S-Cross) grew by 11.3 per cent whereas vans (Omni and Eeco) sales fell by 26.8 per cent in October YoY.

For the April to October period, however, total sales were down by 20.3 per cent to 8.94 lakh units from 11.2 lakh in the year-ago period.

Domestic sales dipped by 21.4 per cent to 8.31 lakh units from 10.5 lakh units while export sales edged lower by 2.6 per cent to 63,069 units from 64,753 units year-on-year.

Maruti Suzuki India on Friday reported 4.5 per cent growth year-on-year in October sales led by compact and utility vehicle segments. Driven by the festive season and heavy discounts, the company sold 1.

Maruti Suzuki India on Friday reported 4.5 per cent growth year-on-year in October sales led by compact and utility vehicle segments. Driven by the festive season and heavy discounts, the company sold 1.53 lakh units during the month against 1.46 lakh units sold in the same month of last year. The country`s largest car manufacturer said domestic sales in October grew by 4.5 per cent year-on-year to 1.44 lakh units from 1.38 lakh units and exports increased 5.7 per cent to 9,158 units from 8,666 units. Passenger car sales were up by 4.4 per cent to 1.06 lakh units compared to 1.01 lakh units in October last year. The compact car segment (new WagonR, Celerio, Ignis, Swift, Baleno and Dzire) clocked 15.9 per cent growth but mini segment (Alto, S-Presso and old WagonR) showed 13.1 per cent decline. Utility vehicles sales (Gypsy, Ertiga, XL6, Vitara Brezza and S-Cross) grew by 11.3 per cent whereas vans (Omni and Eeco) sales fell by 26.8 per cent in October YoY. For the April to October period, however, total sales were down by 20.3 per cent to 8.94 lakh units from 11.2 lakh in the year-ago period. Domestic sales dipped by 21.4 per cent to 8.31 lakh units from 10.5 lakh units while export sales edged lower by 2.6 per cent to 63,069 units from 64,753 units year-on-year.

Maruti Suzuki October sales up by 4.5% to 1.53 lakh units amid festive season

India plans to take more steps to boost consumer demand including injecting liquidity through banks and simplifying personal taxes, a top government economic adviser said on Friday, in a bid to raise economic growth from six-year lows.

Krishnamurthy Subramanian, Chief Economic Adviser at the Finance Ministry, said the government had slashed corporate taxes to attract investment and was looking for ways to boost consumer demand to support that investment.

"In the short-run, we are taking steps to increase consumption so that anticipating that consumption, investment also goes up," he told Reuters in an interview.

One of the measures on the table is aimed at easing personal taxation and making the whole tax administration simpler. The government is also considering the report of a task force to bring India's six-decades-old tax legislation more into line with those of other countries.

Subramanian said the government planned to make public the recommendations of the task force.

"The direct tax code task force has submitted its report," he said, adding that the steps that have already been taken to streamline the tax administration are likely to help in improving the tax buoyancy.

Last month Finance Minister Nirmala Sitharaman <a href="https://www.wionews.com/opinions/corporate-tax-cut-may-act-as-a-steroid-for-the-economy-254318">cut corporate tax </a>rates from over 30 per cent&nbsp;to 25 per cent, and to 15 per cent&nbsp;for new manufacturing companies, putting it on a par or even ahead of some of its Asian peers.

That landmark move has raised hopes that the government might consider similar cuts to personal taxes to put more money into the hands of consumers and especially the middle class who form the core of Prime Minister Narendra Modi's ruling group.

A source in the finance ministry said the task force's recommendations - which include cuts in the income tax rate by up to 10 per cent&nbsp;- could be announced even before the presentation in February of the annual budget for fiscal 2020/21, which starts in April.

"Timing of the implementation is a political call," said the source, adding that officials have already held discussions on the issue.

Growth in April-June slipped to 5 per cent, its slowest pace since 2013. The International Monetary Fund has cut its growth forecast to 6.1 per cent&nbsp;for this fiscal year from an initial 7 per cent, citing a slowdown in domestic and global demand.

New Delhi has also been trying to boost domestic growth through an infrastructure package and a new loan program organised with the banking sector that has doled out loans worth over 800 billion rupees.

Subramanian said the government has asked the banks to buy out assets from the crisis-hit non-banking finance companies to improve liquidity in the market.

"The government will do all that it takes to take back the growth on the high trajectory."

Referring to banking reforms, he said, the government was focussed on the merger of some state banks, aiming to cut down the number of state banks to 12 from 27 in 2017, and has asked them to take corporate default cases to bankruptcy courts only above a threshold limit.

India plans to take more steps to boost consumer demand including injecting liquidity through banks and simplifying personal taxes, a top government economic adviser said on Friday, in a bid to raise economic growth from six-year lows.

India plans to take more steps to boost consumer demand including injecting liquidity through banks and simplifying personal taxes, a top government economic adviser said on Friday, in a bid to raise economic growth from six-year lows. Krishnamurthy Subramanian, Chief Economic Adviser at the Finance Ministry, said the government had slashed corporate taxes to attract investment and was looking for ways to boost consumer demand to support that investment. "In the short-run, we are taking steps to increase consumption so that anticipating that consumption, investment also goes up," he told Reuters in an interview. One of the measures on the table is aimed at easing personal taxation and making the whole tax administration simpler. The government is also considering the report of a task force to bring India's six-decades-old tax legislation more into line with those of other countries. Subramanian said the government planned to make public the recommendations of the task force. "The direct tax code task force has submitted its report," he said, adding that the steps that have already been taken to streamline the tax administration are likely to help in improving the tax buoyancy. Last month Finance Minister Nirmala Sitharaman cut corporate tax rates from over 30 per cent to 25 per cent, and to 15 per cent for new manufacturing companies, putting it on a par or even ahead of some of its Asian peers. That landmark move has raised hopes that the government might consider similar cuts to personal taxes to put more money into the hands of consumers and especially the middle class who form the core of Prime Minister Narendra Modi's ruling group. A source in the finance ministry said the task force's recommendations - which include cuts in the income tax rate by up to 10 per cent - could be announced even before the presentation in February of the annual budget for fiscal 2020/21, which starts in April. "Timing of the implementation is a political call," said the source, adding that officials have already held discussions on the issue. Growth in April-June slipped to 5 per cent, its slowest pace since 2013. The International Monetary Fund has cut its growth forecast to 6.1 per cent for this fiscal year from an initial 7 per cent, citing a slowdown in domestic and global demand. New Delhi has also been trying to boost domestic growth through an infrastructure package and a new loan program organised with the banking sector that has doled out loans worth over 800 billion rupees. Subramanian said the government has asked the banks to buy out assets from the crisis-hit non-banking finance companies to improve liquidity in the market. "The government will do all that it takes to take back the growth on the high trajectory." Referring to banking reforms, he said, the government was focussed on the merger of some state banks, aiming to cut down the number of state banks to 12 from 27 in 2017, and has asked them to take corporate default cases to bankruptcy courts only above a threshold limit.

India to take more steps to boost consumer demand, growth: Chief Economic Adviser

Singapore announced the addition of India to its&nbsp;Global Innovation Alliance (GIA) tech startup network, which will connect the island nation`s fledgeling tech companies as well as small and medium-sized enterprises (SMEs) to India`s technology ecosystem.

This collaboration was launched by S Iswaran, Singapore's Minister-in-charge of Trade Relations in Bangalore at 10th edition of TechSparks last week. Launched in 2017, GIA is an initiative led by three Singapore government bodies - the Singapore Economic Development Board (EDB), Ministry of Education (MOE) and Enterprise Singapore.

It aims to strengthen Singapore`s connections to major innovation hubs around the world, thereby creating an exchange of ideas and knowledge to promote innovation. Through this, it is envisaged that more opportunities will be available to students, entrepreneurs and businesses, to gain experience and to connect and collaborate with their overseas counterparts.

GIA further works with various in-market partners such as accelerators, incubators, co-working space providers and universities to set-up innovation launchpads overseas. Startups can expand their businesses to GIA cities by connecting to mentor networks and relevant ecosystem players.

With Bangalore onboard, the GIA network will cover 12 cities in nine countries - China (Beijing, Shanghai, Suzhou), France (Paris), Germany (Berlin and Munich), India (Bengaluru), Indonesia (Jakarta), Japan (Tokyo), Thailand (Bangkok), Vietnam (Ho Chi Minh City) and the US (San Francisco).

TechSparks 2019 is a technology event organised by YourStory, India`s foremost media technology platform which brings together startups, entrepreneurs, policymakers, business leaders, innovators, investors and media houses to discuss and debate ideas. It is also an event rich with networking opportunities.

During the event, the Singapore Minister, S Iswaran said: "We hope that this will not only pave the way for more partnerships between enterprises from both countries but also drive the growth of our startup ecosystems to benefit both our economies."

Mr Iswaran also witnessed the signing of four memoranda of understanding (MOUs), three of which involve business partnerships Enterprise Singapore has with Indian platforms. One of them is with Indian speed scaling platform Anthill Ventures. Anthill Ventures which has offices in Singapore, Hyderabad and New York, specialises in helping early-growth stage startups with among other things connecting with industry experts, mentoring, market reach and finding investors.

In the agreement with Enterprise Singapore, they will facilitate the entry of Singapore-based startups into the Indian market through Bangalore. A programme, which begins in November, will include a three-day boot camp in Singapore and a two-week immersion programme in Bangalore where participants will meet Indian enterprises and participate in field trips.

Another partnership is with The Indus Entrepreneurs Global (TiE), a non-profit startup network founded in Silicon Valley by Indian-American businessmen Kanwal Rekhi. The TiE will connect Singapore startups to mentors and venture capitalists in the Indian startup scene. Its mission is to nurture the next generation of entrepreneurs through mentoring, networking, education, funding and incubation.

Enterprise Singapore`s third MOU is with YourStory, the organisers of the event, with the aim to foster collaboration between the startups and entrepreneur communities of Singapore and India and to increase business opportunities.

The final MOU signed during the event was between Anthill Ventures and Singapore property giant CapitaLand's coworking space BRIDGE+ to provide a conducive environment for tech startups and companies to collaborate. The launchpad in CapitaLand`s International Tech Park Bengaluru&nbsp;is also where the GIA Acceleration Programme will be conducted.

Tan Soon Kim, assistant chief executive officer of Enterprise Singapore in comments to The Business Times of Singapore emphasised the bilateral nature of GIA adding that Indian startups are encouraged to come to Singapore and tap on Singapore`s rich ecosystem and thereafter to branch out into Southeast Asia.

According to a study by the Economic Research Institute for ASEAN and East Asia published recently, the digital economy of ASEAN is expected to grow by 6.4 times, from $31 billion in 2015 to $197 billion by 2025.

Bilateral trade between Singapore and India stood at $19.2 billion&nbsp;in 2018 according to Singapore`s Ministry of Trade and Industry figures. This is an increase of 15 per cent from 2015 where two-way trade stood at SGD 23.07 billion. Of this, about 65 per cent is of goods imported into India from Singapore.

Singapore was the largest foreign investor in India in the last Indian fiscal year with Singapore-based companies committing over $16.2 billion in investments.

Singapore Minister Iswaran added in a Facebook post, "The innovation ecosystems in Singapore and India have many synergies, and Bangalore has an established technology scene, along with a strong startup and innovation ecosystem. I`m encouraged that with the GIA, Singaporeans and Singapore companies will have more opportunities to collaborate with their counterparts in India to create innovative solutions."

Singapore announced the addition of India to its Global Innovation Alliance (GIA) tech startup network, which will connect the island nation`s fledgeling tech companies as well as small and medium-sized enterprises (SMEs) to India`s technology ecosystem.

Singapore announced the addition of India to its Global Innovation Alliance (GIA) tech startup network, which will connect the island nation`s fledgeling tech companies as well as small and medium-sized enterprises (SMEs) to India`s technology ecosystem. This collaboration was launched by S Iswaran, Singapore's Minister-in-charge of Trade Relations in Bangalore at 10th edition of TechSparks last week. Launched in 2017, GIA is an initiative led by three Singapore government bodies - the Singapore Economic Development Board (EDB), Ministry of Education (MOE) and Enterprise Singapore. It aims to strengthen Singapore`s connections to major innovation hubs around the world, thereby creating an exchange of ideas and knowledge to promote innovation. Through this, it is envisaged that more opportunities will be available to students, entrepreneurs and businesses, to gain experience and to connect and collaborate with their overseas counterparts. GIA further works with various in-market partners such as accelerators, incubators, co-working space providers and universities to set-up innovation launchpads overseas. Startups can expand their businesses to GIA cities by connecting to mentor networks and relevant ecosystem players. With Bangalore onboard, the GIA network will cover 12 cities in nine countries - China (Beijing, Shanghai, Suzhou), France (Paris), Germany (Berlin and Munich), India (Bengaluru), Indonesia (Jakarta), Japan (Tokyo), Thailand (Bangkok), Vietnam (Ho Chi Minh City) and the US (San Francisco). TechSparks 2019 is a technology event organised by YourStory, India`s foremost media technology platform which brings together startups, entrepreneurs, policymakers, business leaders, innovators, investors and media houses to discuss and debate ideas. It is also an event rich with networking opportunities. During the event, the Singapore Minister, S Iswaran said: "We hope that this will not only pave the way for more partnerships between enterprises from both countries but also drive the growth of our startup ecosystems to benefit both our economies." Mr Iswaran also witnessed the signing of four memoranda of understanding (MOUs), three of which involve business partnerships Enterprise Singapore has with Indian platforms. One of them is with Indian speed scaling platform Anthill Ventures. Anthill Ventures which has offices in Singapore, Hyderabad and New York, specialises in helping early-growth stage startups with among other things connecting with industry experts, mentoring, market reach and finding investors. In the agreement with Enterprise Singapore, they will facilitate the entry of Singapore-based startups into the Indian market through Bangalore. A programme, which begins in November, will include a three-day boot camp in Singapore and a two-week immersion programme in Bangalore where participants will meet Indian enterprises and participate in field trips. Another partnership is with The Indus Entrepreneurs Global (TiE), a non-profit startup network founded in Silicon Valley by Indian-American businessmen Kanwal Rekhi. The TiE will connect Singapore startups to mentors and venture capitalists in the Indian startup scene. Its mission is to nurture the next generation of entrepreneurs through mentoring, networking, education, funding and incubation. Enterprise Singapore`s third MOU is with YourStory, the organisers of the event, with the aim to foster collaboration between the startups and entrepreneur communities of Singapore and India and to increase business opportunities. The final MOU signed during the event was between Anthill Ventures and Singapore property giant CapitaLand's coworking space BRIDGE+ to provide a conducive environment for tech startups and companies to collaborate. The launchpad in CapitaLand`s International Tech Park Bengaluru is also where the GIA Acceleration Programme will be conducted. Tan Soon Kim, assistant chief executive officer of Enterprise Singapore in comments to The Business Times of Singapore emphasised the bilateral nature of GIA adding that Indian startups are encouraged to come to Singapore and tap on Singapore`s rich ecosystem and thereafter to branch out into Southeast Asia. According to a study by the Economic Research Institute for ASEAN and East Asia published recently, the digital economy of ASEAN is expected to grow by 6.4 times, from $31 billion in 2015 to $197 billion by 2025. Bilateral trade between Singapore and India stood at $19.2 billion in 2018 according to Singapore`s Ministry of Trade and Industry figures. This is an increase of 15 per cent from 2015 where two-way trade stood at SGD 23.07 billion. Of this, about 65 per cent is of goods imported into India from Singapore. Singapore was the largest foreign investor in India in the last Indian fiscal year with Singapore-based companies committing over $16.2 billion in investments. Singapore Minister Iswaran added in a Facebook post, "The innovation ecosystems in Singapore and India have many synergies, and Bangalore has an established technology scene, along with a strong startup and innovation ecosystem. I`m encouraged that with the GIA, Singaporeans and Singapore companies will have more opportunities to collaborate with their counterparts in India to create innovative solutions."

Singapore adds Bengaluru to its Global Innovation Alliance

Any nation, developed or developing, carries the accountability of building a sustainable future for its citizens by upholding the environment, maintaining culture and supporting a stable, growing economy. Rapid globalisation has changed the economic structures of developing and developed nations through innovation, increased communication and technology. The model set by the Modi 1.0 and 2.0 governments in particular, has brought about a defining, positive reform process for India's economic stabilisation. India's model aims at resolute economic growth. The Narendra Modi-led NDA 1.0's aggressive push for industrialisation and schemes to bolster several sectors have induced rapid growth. In particular, India focused on cash crops, natural resources, renewable energy, small businesses, entrepreneurship and public capital investment.

However, there were several factors that hindered stable growth and will pose a challenge to growth over the next five years. For India, these factors are monsoon and unpredictability in oil.

Monsoon

The Indian economy is indispensably linked with our monsoon because of water resources. Most of the country gets over 75 per cent annual rainfall in just three to four months which impacts agriculture, in particular, grain crops (legumes, wheat etc). Hydro-electric power also makes up a significant portion of power usage in India. Generating renewable energy from water is especially lucrative for India because monsoon is a consistent season in India even though the amount of water fluctuates. Speaking of which, over the past five years, the economy has faced hard luck in terms of monsoon. Water potential and wind power directly impact the Indian economy. Wind power is used to generate electricity and even to draw water. As for rainfall, the Modi-led NDA's first term was hit by drought, floods or pointedly less rainfall in comparison to previous years. In this time, the population also exploded to 1.3 billion people. The population has increased at a much faster rate than grain production. If this trend continues, India will face a very serious economic crisis.

At the end of the day, we are all hoping for stable and necessary rainfall over the next monsoon season so that the economy can also stabilise in this regard. Additionally, in order to offset shocks from potential years of drought and/or floods, PM Modi can take several steps. The first is to create mechanisms for mass water storage from unused monsoon water in places of largescale irrigation and where hydro-power is generated. A system should be devised where not a drop is wasted. This is especially important because PM Modi has assured to double farmer incomes and this year's Budget depends expressively on agriculture to boost the economy. Simultaneously, one can see the crisis associated with no water in Chennai, for example, over the past four months. The government has also paid farmers during past droughts which puts fiscal deficit under stress. Food accounts for approximately half of India's consumer price index. Therefore, droughts and floods also raise prices on crop which requires more government spending on welfare. Another step PM Modi should take is utilising technological innovation in cultivation and transportation of agriculture. Technology should also be used with more focus in things like soil testing, water allocation and water management. Agricultural innovation should be encouraged and used with full force as well.

Oil

The precariousness of oil prices is a major destabilising factor for the Indian economy. It proves especially poignant for India who imports a significant portion of our oil. Most recently, India has lost 11 per cent of its oil from Iran when we agreed to comply with US sanctions. Oil volatility can lead to large deficits and can force the government to spend money on energy instead of allocating to other necessary areas (water, schemes to help poor, etc). Therefore, it is necessary to build shields to offset volatility shocks over the next five years. There are several methods to do this. PM Modi should focus on more active derivative financial and commodities markets with oil products. This will help India reduce dependence for oil imports and would also bring discipline to the oil market. Another suggestion would be to strengthen the rupee. This would help deflect the surges from oil import bills which are inelastic in nature.&nbsp; Inelasticity in this case refers to consumer buying habits remain unchanged regardless of the price of oil increasing or decreasing.

As a rapidly growing economy over the next five years, it is high time that India understands and acts to buffer the severity of oil prices; especially in light of US sanctions on oil producing countries that India receives exports from. Oil volatility can destabilise our economy and also has the potential to disrupt the global economy by causing a precipitous inflation. If the above measures are implemented, India would be able to not only cushion oil volatility shocks, but also reduce volatile oil prices to a sustainable, predictable level.

Conclusion

Despite these imponderables, India is still well on its way to become a US $5 trillion economy. The development of the energy market will be a determining factor of how fast we reach the target, as will employment generation, water management and sustainable growth. The good news is that PM Modi has placed immense importance on all of these areas respectively.

The number of government job vacancies are expected to grow in the next year through schemes involving industry and government (ie. Sagarmala Port project, road, railway infrastructure across the country, development in the Northeast, etc). A water ministry has already been implemented and there are multiple schemes for environment sustainability. PM Modi's increased focus and expansion on already existing on healthcare (Ayushman Bharat) and education schemes (Beti Bachao, NEP 2019, etc) aim to alleviate overpopulation in the next decade. Now it is up to citizens to also actively join forces with the government. If we work to conserve water, develop innovation (especially in agriculture, renewable energy) and clean up our environment, why just a five trillion economy? We can achieve a ten trillion dollar economy in less than five years.

(Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL.)

Any nation, developed or developing, carries the accountability of building a sustainable future for its citizens by upholding the environment, maintaining culture and supporting a stable, growing economy.

Any nation, developed or developing, carries the accountability of building a sustainable future for its citizens by upholding the environment, maintaining culture and supporting a stable, growing economy. Rapid globalisation has changed the economic structures of developing and developed nations through innovation, increased communication and technology. The model set by the Modi 1.0 and 2.0 governments in particular, has brought about a defining, positive reform process for India's economic stabilisation. India's model aims at resolute economic growth. The Narendra Modi-led NDA 1.0's aggressive push for industrialisation and schemes to bolster several sectors have induced rapid growth. In particular, India focused on cash crops, natural resources, renewable energy, small businesses, entrepreneurship and public capital investment. However, there were several factors that hindered stable growth and will pose a challenge to growth over the next five years. For India, these factors are monsoon and unpredictability in oil. Monsoon The Indian economy is indispensably linked with our monsoon because of water resources. Most of the country gets over 75 per cent annual rainfall in just three to four months which impacts agriculture, in particular, grain crops (legumes, wheat etc). Hydro-electric power also makes up a significant portion of power usage in India. Generating renewable energy from water is especially lucrative for India because monsoon is a consistent season in India even though the amount of water fluctuates. Speaking of which, over the past five years, the economy has faced hard luck in terms of monsoon. Water potential and wind power directly impact the Indian economy. Wind power is used to generate electricity and even to draw water. As for rainfall, the Modi-led NDA's first term was hit by drought, floods or pointedly less rainfall in comparison to previous years. In this time, the population also exploded to 1.3 billion people. The population has increased at a much faster rate than grain production. If this trend continues, India will face a very serious economic crisis. At the end of the day, we are all hoping for stable and necessary rainfall over the next monsoon season so that the economy can also stabilise in this regard. Additionally, in order to offset shocks from potential years of drought and/or floods, PM Modi can take several steps. The first is to create mechanisms for mass water storage from unused monsoon water in places of largescale irrigation and where hydro-power is generated. A system should be devised where not a drop is wasted. This is especially important because PM Modi has assured to double farmer incomes and this year's Budget depends expressively on agriculture to boost the economy. Simultaneously, one can see the crisis associated with no water in Chennai, for example, over the past four months. The government has also paid farmers during past droughts which puts fiscal deficit under stress. Food accounts for approximately half of India's consumer price index. Therefore, droughts and floods also raise prices on crop which requires more government spending on welfare. Another step PM Modi should take is utilising technological innovation in cultivation and transportation of agriculture. Technology should also be used with more focus in things like soil testing, water allocation and water management. Agricultural innovation should be encouraged and used with full force as well. Oil The precariousness of oil prices is a major destabilising factor for the Indian economy. It proves especially poignant for India who imports a significant portion of our oil. Most recently, India has lost 11 per cent of its oil from Iran when we agreed to comply with US sanctions. Oil volatility can lead to large deficits and can force the government to spend money on energy instead of allocating to other necessary areas (water, schemes to help poor, etc). Therefore, it is necessary to build shields to offset volatility shocks over the next five years. There are several methods to do this. PM Modi should focus on more active derivative financial and commodities markets with oil products. This will help India reduce dependence for oil imports and would also bring discipline to the oil market. Another suggestion would be to strengthen the rupee. This would help deflect the surges from oil import bills which are inelastic in nature. Inelasticity in this case refers to consumer buying habits remain unchanged regardless of the price of oil increasing or decreasing. As a rapidly growing economy over the next five years, it is high time that India understands and acts to buffer the severity of oil prices; especially in light of US sanctions on oil producing countries that India receives exports from. Oil volatility can destabilise our economy and also has the potential to disrupt the global economy by causing a precipitous inflation. If the above measures are implemented, India would be able to not only cushion oil volatility shocks, but also reduce volatile oil prices to a sustainable, predictable level. Conclusion Despite these imponderables, India is still well on its way to become a US $5 trillion economy. The development of the energy market will be a determining factor of how fast we reach the target, as will employment generation, water management and sustainable growth. The good news is that PM Modi has placed immense importance on all of these areas respectively. The number of government job vacancies are expected to grow in the next year through schemes involving industry and government (ie. Sagarmala Port project, road, railway infrastructure across the country, development in the Northeast, etc). A water ministry has already been implemented and there are multiple schemes for environment sustainability. PM Modi's increased focus and expansion on already existing on healthcare (Ayushman Bharat) and education schemes (Beti Bachao, NEP 2019, etc) aim to alleviate overpopulation in the next decade. Now it is up to citizens to also actively join forces with the government. If we work to conserve water, develop innovation (especially in agriculture, renewable energy) and clean up our environment, why just a five trillion economy? We can achieve a ten trillion dollar economy in less than five years. (Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL.)

Can India realistically become US $5 trillion economy?

Noting that the level of non-performing loans in India remains high, the International Monetary Fund has favoured bolstering the level of capitalisation of some banks, particularly government-owned banks.&nbsp;

Anna Ilyina, Division Chief of IMF Monetary and Capital Markets Department, said Wednesday that bolstering the level of capitalisation was one of the recommendations of the Financial Sector Assessment Programme (FSAP) for India.&nbsp;

"The level of non-performing loans (NPLs) in India remains high. And the level of the capitalisation of some banks, particularly government-owned banks, should be bolstered," said Ilyina.&nbsp;

"There were some steps that were taken by the authorities to boost capital buffers in banks and also to improve governance in state-owned banks that have had some positive impact," Ilyina said.

The institutional mechanisms for resolution and the recognition of NPLs are, of course, an extremely important part of the process of cleaning up the banking system of non-performing loans, she said adding that the authorities should continue working along these lines.

Tobias Adrian, Financial Counsellor and Director, Monetary and Capital Markets Department of the IMF, said that there continues to be a high stock of Non-performing Assets in India.&nbsp;

"There has been some progression, but we would welcome further progress on the non-performing assets in India,"&nbsp;he said responding to a question on Indian banking system.&nbsp;

The Indian government in February said bad loans fell by Rs 31,168 crore in April-December 2018-19 compared to NPAs worth Rs 8,95,601 crore at March-end 2018.&nbsp;

Noting that the level of non-performing loans in India remains high, the International Monetary Fund has favoured bolstering the level of capitalisation of some banks, particularly government-owned banks.

Noting that the level of non-performing loans in India remains high, the International Monetary Fund has favoured bolstering the level of capitalisation of some banks, particularly government-owned banks. Anna Ilyina, Division Chief of IMF Monetary and Capital Markets Department, said Wednesday that bolstering the level of capitalisation was one of the recommendations of the Financial Sector Assessment Programme (FSAP) for India. "The level of non-performing loans (NPLs) in India remains high. And the level of the capitalisation of some banks, particularly government-owned banks, should be bolstered," said Ilyina. "There were some steps that were taken by the authorities to boost capital buffers in banks and also to improve governance in state-owned banks that have had some positive impact," Ilyina said. The institutional mechanisms for resolution and the recognition of NPLs are, of course, an extremely important part of the process of cleaning up the banking system of non-performing loans, she said adding that the authorities should continue working along these lines. Tobias Adrian, Financial Counsellor and Director, Monetary and Capital Markets Department of the IMF, said that there continues to be a high stock of Non-performing Assets in India. "There has been some progression, but we would welcome further progress on the non-performing assets in India," he said responding to a question on Indian banking system. The Indian government in February said bad loans fell by Rs 31,168 crore in April-December 2018-19 compared to NPAs worth Rs 8,95,601 crore at March-end 2018.

India needs to bolster level of capitalisation of government-owned banks: IMF

India's <a href="https://www.wionews.com/business-%26-economy/india-fastest-growing-economy-now-with-77-per-cent-gdp-growth-rate-141360">economic growth in recent years</a> has been "too much" driven by domestic demand and its exports were about one-third of its potential, a World Bank official said, asserting that the next government needs to focus on export-led growth.

Praising attempts to liberalise markets within India, Hans Timmer, World Bank Chief Economist for the South Asia Region said, "that is what is needed to become more competitive."

"At the same time you've seen also of the last couple of years that the current account deficit widened - an indication that increased growth came from the non-tradable sector -- from the domestic sector, and that makes it difficult to export more,"&nbsp;Timmer told PTI in an interview.

The polling for the first phase of seven-phase parliamentary polls in the country is scheduled to take place on April 11, with the last phase on May 19 and the results will be announced on May 23.

In the last five years, he said, India's overall growth was "too much" driven by domestic demand, which resulted in double-digit growth of imports, and four to five per cent growth in exports.

"In more recent months, that turned around somewhat. But the broader picture was that that's a minus,"&nbsp;he said.

"The pluses were that we have seen the GST trying to create more flexibility within the country so that it's easier to trade between states. That's what you need if you want to trade also with foreign countries,"&nbsp;he said.

Responding to a question, the World Bank official said the focus of the next government should be on reducing the stimulus of domestic demand.

"That would be one. I think looking at trade liberalisation on the import side - that would be another to create more competition. I would look at what people feel like an impediment in the labour market. Is it difficult to go to those new jobs? What about the startups of young people? do they feel restrictions or not?&nbsp;he said, adding that it is also about female labour force participation.

"I think, the most important thing is the understanding that you need export-led growth because that's where you increase productivity when you compete in international markets; that's where you gain knowledge by interacting with competitors and with customers abroad. And so, it is that mindset," the top World Bank official said.

India, Timmer said, is exporting only 10 per cent of its GDP.

"What they should have exported is 30 per cent of the export of GDP, given all their characteristics. India is a big country, so normally a big country doesn't export that much in per cent of their GDP because when you're small you're a lot more open.

"But even for India, 30 per cent would have been normal if you look at the experience of other countries. It's only 10 per cent. So that's an enormous gap. And the gap is widening in the last couple of years,"&nbsp;he told PTI.

According to him, friction between India and Pakistan is unhelpful to the trade and economic growth in the region.

"The lack of regional integration is not the main course of the underperformance in exports. And that's often the assumption. When people look at South Asia, immediately the problem of very limited regional integration jumps up,"&nbsp;he said.

The latest report of the World bank on South Asia, he said, asserts that the economic underperformance of South Asian countries is mainly because they are locked on fundamental issues within the domestic economies that have prevented the countries to become much more export-led as one sees in East Asia.

Trade liberalisation, flexible labour markets skills, trying to address the big problem of the difference between the formal economy and the informal economy, he said are some of his recommendations for the South Asian countries.

"So, it's a lot of domestic issues also. It's not just trading policies. A lot of domestic issues that have to be addressed to unleash that potential that has not been utilised now in exports. It's not one single issue that can solve,"&nbsp;he said.

Responding to a question, Timmer said the South Asian countries need to learn from China.

"The fact that China has been so competitive for so long means that China did something right whereas South Asia didn't do it right. There was a clear focus in China to have export-led growth and to integrate into global markets. And you see a sharp increase in productivity at all. This is not an explanation that we couldn't compete. Somehow, the Chinese did it better than South Asia,"&nbsp;he said.

The top bank official asserted that China is a "big opportunity" for South Asia.

"The slowdown in China is not a cyclical slowdown. It's not because they don't demand any more. They are slowing down because of the supply side. They're running out of cheap labour in general because of their success. They are no longer that competitive, and they have now that policy that they want to rebalance their economy much more towards domestic services, less towards exports," he said.

That means that it has become easier to export to China which is very important, Timmer said.

"It has become easier to compete with the Chinese. So for me China is, what is happening at the moment, is a big opportunity for South Asia,"&nbsp;he stressed.&nbsp;

India's economic growth in recent years has been "too much" driven by domestic demand and its exports were about one-third of its potential, a World Bank official said, asserting that the next government needs to focus on export-led growth.

India's economic growth in recent years has been "too much" driven by domestic demand and its exports were about one-third of its potential, a World Bank official said, asserting that the next government needs to focus on export-led growth. Praising attempts to liberalise markets within India, Hans Timmer, World Bank Chief Economist for the South Asia Region said, "that is what is needed to become more competitive." "At the same time you've seen also of the last couple of years that the current account deficit widened - an indication that increased growth came from the non-tradable sector -- from the domestic sector, and that makes it difficult to export more," Timmer told PTI in an interview. The polling for the first phase of seven-phase parliamentary polls in the country is scheduled to take place on April 11, with the last phase on May 19 and the results will be announced on May 23. In the last five years, he said, India's overall growth was "too much" driven by domestic demand, which resulted in double-digit growth of imports, and four to five per cent growth in exports. "In more recent months, that turned around somewhat. But the broader picture was that that's a minus," he said. "The pluses were that we have seen the GST trying to create more flexibility within the country so that it's easier to trade between states. That's what you need if you want to trade also with foreign countries," he said. Responding to a question, the World Bank official said the focus of the next government should be on reducing the stimulus of domestic demand. "That would be one. I think looking at trade liberalisation on the import side - that would be another to create more competition. I would look at what people feel like an impediment in the labour market. Is it difficult to go to those new jobs? What about the startups of young people? do they feel restrictions or not? he said, adding that it is also about female labour force participation. "I think, the most important thing is the understanding that you need export-led growth because that's where you increase productivity when you compete in international markets; that's where you gain knowledge by interacting with competitors and with customers abroad. And so, it is that mindset," the top World Bank official said. India, Timmer said, is exporting only 10 per cent of its GDP. "What they should have exported is 30 per cent of the export of GDP, given all their characteristics. India is a big country, so normally a big country doesn't export that much in per cent of their GDP because when you're small you're a lot more open. "But even for India, 30 per cent would have been normal if you look at the experience of other countries. It's only 10 per cent. So that's an enormous gap. And the gap is widening in the last couple of years," he told PTI. According to him, friction between India and Pakistan is unhelpful to the trade and economic growth in the region. "The lack of regional integration is not the main course of the underperformance in exports. And that's often the assumption. When people look at South Asia, immediately the problem of very limited regional integration jumps up," he said. The latest report of the World bank on South Asia, he said, asserts that the economic underperformance of South Asian countries is mainly because they are locked on fundamental issues within the domestic economies that have prevented the countries to become much more export-led as one sees in East Asia. Trade liberalisation, flexible labour markets skills, trying to address the big problem of the difference between the formal economy and the informal economy, he said are some of his recommendations for the South Asian countries. "So, it's a lot of domestic issues also. It's not just trading policies. A lot of domestic issues that have to be addressed to unleash that potential that has not been utilised now in exports. It's not one single issue that can solve," he said. Responding to a question, Timmer said the South Asian countries need to learn from China. "The fact that China has been so competitive for so long means that China did something right whereas South Asia didn't do it right. There was a clear focus in China to have export-led growth and to integrate into global markets. And you see a sharp increase in productivity at all. This is not an explanation that we couldn't compete. Somehow, the Chinese did it better than South Asia," he said. The top bank official asserted that China is a "big opportunity" for South Asia. "The slowdown in China is not a cyclical slowdown. It's not because they don't demand any more. They are slowing down because of the supply side. They're running out of cheap labour in general because of their success. They are no longer that competitive, and they have now that policy that they want to rebalance their economy much more towards domestic services, less towards exports," he said. That means that it has become easier to export to China which is very important, Timmer said. "It has become easier to compete with the Chinese. So for me China is, what is happening at the moment, is a big opportunity for South Asia," he stressed.

India's economic growth driven by domestic demand, need to focus on exports: World Bank

The United States President Donald Trump intends to&nbsp;terminate the Generalised System of Preferences (GSP) program with India and Turkey,&nbsp;US trade chief's office said on Monday.

GSP is a preferential tariff system extended by developed countries to developing countries, also known as beneficiary countries, to grow their economy. It is a preferential arrangement that allows concessional low/zero tariff imports from&nbsp;120 designated beneficiary countries and territories.&nbsp;

Washington "intends to terminate India's and Turkey's designations as beneficiary developing countries under the Generalized System of Preferences (GSP) program because they no longer comply with the statutory eligibility criteria," the Office of the US Trade Representative said in a statement.

The changes cannot take effect for at least 60 days following the notification of Congress as well as the countries affected -- a process Trump began Monday with letters to the speaker of the House of Representatives and the president of the Senate.

Also read: <a href="http://www.wionews.com/india-news/want-reciprocal-tax-on-india-to-match-tariffs-on-us-exports-says-donald-trump-200816">Want 'reciprocal tax' on India to match tariffs on US exports, says Donald Trump</a>

India has failed to provide assurances that it would allow required market access, while Turkey is "sufficiently economically developed" that it no longer qualifies, the statement read.

India, however, "has implemented a wide array of trade barriers that create serious negative effects on United States commerce," the statement said.

The statement also said that Turkey, after being designated a GSP beneficiary in 1975, has meanwhile demonstrated a "higher level of economic development," meaning that it can be "graduated" from the program.

Trump, who has vowed to reduce US trade deficits, has repeatedly called out India for its high tariffs.

The US goods and services trade deficit with India was $27.3 billion in 2017, according to the US Trade Representative's Office.

India is the world's largest beneficiary of the GSP program and ending its participation would be the strongest punitive action against India since Trump took office in 2017.

"I will continue to assess whether the Government of India is providing equitable and reasonable access to its markets, in accordance with the GSP eligibility criteria," the President wrote in the letter sent to Congress.

India reportedly&nbsp;enjoys preferential tariff on exports worth of nearly $ 5.6 billion under the GSP route out of the total exports of $48 billion in 2017-18.

On Saturday as well,&nbsp;Trump accused India of being a "high tariff nation" and threatened to impose "a reciprocal tax" to match heavy duties that New Delhi imposes on goods from the United States.

Addressing the last day of a four-day annual Conservative Political Action Conference (CPAC) in Maryland, the US President said, "India is a very high tariff nation. When we send a motorcycle to India, they charge 100 per cent tariff. When India sends a motorcycle to us, we charge nothing. I want a reciprocal tax, at least I want to charge a tax."

(With inputs from&nbsp;agencies)

The United States President Donald Trump intends to terminate the Generalised System of Preferences (GSP) program with India and Turkey, US trade chief's office said on Monday.

The United States President Donald Trump intends to terminate the Generalised System of Preferences (GSP) program with India and Turkey, US trade chief's office said on Monday. GSP is a preferential tariff system extended by developed countries to developing countries, also known as beneficiary countries, to grow their economy. It is a preferential arrangement that allows concessional low/zero tariff imports from 120 designated beneficiary countries and territories. Washington "intends to terminate India's and Turkey's designations as beneficiary developing countries under the Generalized System of Preferences (GSP) program because they no longer comply with the statutory eligibility criteria," the Office of the US Trade Representative said in a statement. The changes cannot take effect for at least 60 days following the notification of Congress as well as the countries affected -- a process Trump began Monday with letters to the speaker of the House of Representatives and the president of the Senate. Also read: Want 'reciprocal tax' on India to match tariffs on US exports, says Donald Trump India has failed to provide assurances that it would allow required market access, while Turkey is "sufficiently economically developed" that it no longer qualifies, the statement read. India, however, "has implemented a wide array of trade barriers that create serious negative effects on United States commerce," the statement said. The statement also said that Turkey, after being designated a GSP beneficiary in 1975, has meanwhile demonstrated a "higher level of economic development," meaning that it can be "graduated" from the program. Trump, who has vowed to reduce US trade deficits, has repeatedly called out India for its high tariffs. The US goods and services trade deficit with India was $27.3 billion in 2017, according to the US Trade Representative's Office. India is the world's largest beneficiary of the GSP program and ending its participation would be the strongest punitive action against India since Trump took office in 2017. "I will continue to assess whether the Government of India is providing equitable and reasonable access to its markets, in accordance with the GSP eligibility criteria," the President wrote in the letter sent to Congress. India reportedly enjoys preferential tariff on exports worth of nearly $ 5.6 billion under the GSP route out of the total exports of $48 billion in 2017-18. On Saturday as well, Trump accused India of being a "high tariff nation" and threatened to impose "a reciprocal tax" to match heavy duties that New Delhi imposes on goods from the United States. Addressing the last day of a four-day annual Conservative Political Action Conference (CPAC) in Maryland, the US President said, "India is a very high tariff nation. When we send a motorcycle to India, they charge 100 per cent tariff. When India sends a motorcycle to us, we charge nothing. I want a reciprocal tax, at least I want to charge a tax." (With inputs from agencies)

I intend to end preferential trade status for India, Turkey: Trump

The 10th India-Japan Foreign Minister-level Strategic Dialogue was held between External Affairs Minister Sushma Swaraj and her Japanese counterpart Tarō Kōno on Monday in New Delhi.

During the Strategic Dialogue, India and Japan agreed that Kōno's visit to India provides an opportunity for the nations to identify agendas in bilateral relations in 2019.

He was on an official three-day visit to India from January 7 to January 9.

Speaking to former Indian ambassador to the US Arun K Singh on WION's 'The Diplomacy Show', Kono said, "India has a huge potential and it is a growing economy with a young population. So it's good to have a very friendly relationship with India and Japan and India could be a natural ally in terms of our economy and defence and security."

WION:&nbsp;You are visiting India and is this the first time you have come to India or you've been here before?&nbsp;

Kōno: Well, this is the first time as a Foreign Minister. But, I have been to New Delhi and Mumbai before. Your government kindly invited my wife and I two years ago. So I visited New Delhi and Mumbai and before that, I attended a conference on energy policy. So it's good to be back.

WION:&nbsp;So you have had an engagement with India from before and although you've been Foreign Minister for a little over a year. And you'd have interacted with Indian leaders, I think you hosted the Indian Foreign Minister in Japan last year. &nbsp;

Kōno: Yes. &nbsp;

WION:The Indian Prime Minister was there in October but this is your first time as the Foreign Minister. Dealing with the relationship in that capacity and visiting India, what are the impressions you have formed. Where are we in the relationship? &nbsp;

Kōno: Well, India has a huge potential and it is a growing economy with a young population. So it's good to have a very friendly relationship with India and Japan and India could be a natural ally in terms of our economy and defence and security. So I'm very glad to be able to visit India as a Foreign Minister. &nbsp;

WION:Both countries have now described the relationship as a special strategic and global partnership. Is that designation justified?

Kōno: I think so. India is the largest democracy on this planet and India and Japan share many common values, democracy, human rights, rule of law and we are strategically, I think aligned very nicely. So I think we need to work hard to develop this special strategic relationship into the future. &nbsp;

WION:&nbsp;In the statement that has been put out by the Japanese Foreign Ministry after your meetings here with your counterpart; the Foreign Minister and the Prime Minister. It has been said that India is the most important partner for Japan in the context of the free and open Indo-Pacific. Why is that?&nbsp;

Kōno: Well, India is the largest recipient of our ODA (Official Development Assistance) and Japan is now the third largest investor in India. More than fifteen hundred Japanese companies are now very active in the Indian market and India as well and I think keeping free and open sea lines of communication is vital to the economic prosperity in not only Asia but for Africa, the Middle East, all the way across the Pacific to the western coast of the United States and we share common values of this free and open Indo-Pacific vision and India is the most important partner to making it happen. We need to work on connectivity for economic prosperity and also we need to work together to keep the law enforcement capacity of the countries along the coast and we can work together on this issue as well. So this relationship needs to be stronger and I think it is natural to say this is the most important partnership to make a 'free and open Indo-Pacific' happen.&nbsp;

WION:&nbsp;You referred to the important investment by the Japanese companies in India, the large number of Japanese companies present here, but if you look at the trade relationship and the total trade seems to be in the order of about 16 billion dollars. What more can we do to enhance our trading partnership?&nbsp;

Kōno: Well, we are now working on RCEP. We hope to conclude this negotiation by the end of 2019. Also, we concluded TPP (Trans-Pacific Partnership) negotiations and India is welcome to join TPP. So now there is a lot of protectionism rising all over the world. But I think we can work to keep free and open trade and I think that is beneficial for India and Japan as well.&nbsp;

WION:&nbsp;Defence is one area where India and Japan are looking at doing more and more. We have now agreed to hold the two plus two dialogue of foreign and defence ministers. There is a defence policy dialogue. We do a large number of exercises including the Malabar series of exercises.&nbsp;

What can be done in terms of enhancing defence cooperation in terms of trade in defence or technology partnership? What's your sense of what are the obstacles there?&nbsp;

Kōno: When Prime Minister Modi visited Japan last year, we agreed to start two plus two ministerial meeting process and we are holding a dialogue on cyber, dialogue on space. As you mentioned, the Japanese Maritime Self-defence Force are participating officially in Malabar exercise and Indian Army-Air Force is working with Japanese self-defence forces in joint exercises. So there is a lot of cooperation between our Self-defence Force and Indian armed forces.&nbsp;

At the same time there are a lot of things we can do to get the defence industry going and so there is a lot of potential and creating very strong relationship between Japan and India or plus the US or even Australia will bring stability in this Indo-Pacific region and I think stability is a cornerstone for the economic prosperity of this region. So having a good, stable relationship between Japan and India, we can build on a lot of things on this fundamentals.&nbsp;

WION:Certainly, and in the context of the Indo-Pacific; we have the trilateral meetings between India, US and Japan and I think you along with your US and Indian colleague had a meeting in New York and the Indian and the Japanese Prime Minister had a meeting with President Trump recently in the framework of the G-20. So, how are you seeing the potential for the trilateral partnership in the context to Indo-Pacific and the Quadrilateral involving Australia?&nbsp;

Kōno: We had a summit meeting among the three countries in Buenos Aires at &nbsp;G-20 and probably this year in Osaka during the G-20 summit, there's gonna be another trilateral summit meeting. So, this trilateral relationship will be getting stronger and we can coordinate defence and security policy, we can coordinate economic policy as well and plus we are now having DG (Director General) level meeting including Australia.

WION:Okay.&nbsp;

Kōno: So, this is a new mechanism for this region to keep this free and open trade, free and open sea lines of communication. So it could be a good vehicle to build a multilateral relationship.

WION:As countries are looking at new frameworks for interaction, new architectures for security and other forms of cooperation in the Indo-Pacific. Clearly, they're also looking at the rise of China; the economic, the technological, the military rise of China, its assertiveness be it in the South China Sea, the East China Sea, the Senkaku Islands. How are you looking at the challenge from the rise of China as far as Japan is concerned and in terms of Japan's interests and globally how should the world react and deal with that?&nbsp;

Kōno: Well for last 40 years, the Japanese government, as well as Japanese private sector, helped the Chinese economy to grow. I think a stable growth of the Chinese economy according to the existing international order will give great opportunity for many other economies to prosper. But unfortunately, there is some disagreement with China such as protecting intellectual property right or industrial subsidies or sort of - forced technology transfer.&nbsp;

So, we need to get China to play the game according to the international rule; but if China comes back to stable growth and they play the same game, it will provide a lot of opportunity for the region. At the same time, they are violating our territorial water in the East China Sea and their action in the South China Sea needs to be corrected. So on those fundamental issues, Japan has no intention to concede. I think we need to get China engaged in the International framework and try to get China to play according to the international rules. So, it is important to cooperate among US, Japan, India or another country and get China to play within their existing liberal international order, that will create a lot of opportunity.&nbsp;

WION:Many have argued that the fact that the Chinese economic system is essentially based on state-owned enterprises and therefore; the manner in which they compete with private sector-led economies does not quite meet the WTO (World Trade Organisation) framework and rules and norms. So how can one deal with that challenge?&nbsp;

Kōno: Well, a lot of economic issues need to be solved within the framework of WTO. We are trying to get US, Europe, Japan, and another like-minded country to modernize the WTO. I think we need to address the issue of e-commerce and all those things need to be addressed within the framework of WTO. So, at the same time, we need to modernize WTO better. We need to ask each country; China, US, and others to play the game according to the WTO rules.&nbsp;

WION:&nbsp;The relations with the United States are a very critical relationship for Japan since the Second World War. It's a very important security partner for Japan but of late there are voices emerging from the US; challenging or questioning US commitment to its allies, partners, security commitment. Given that, has that caused some anxiety concern in Japan about how the US is looking at its evolving role in the global context, in the context of the Asia-Pacific?&nbsp;

Kōno: Well, I think the alliance between Japan and the United States is the cornerstone for security policy of Japan and President Trump and his administration's commitment to Asia or the Asia Pacific is still very strong in terms of security and defence policy. It is unfortunate that Washington left TPP and we are still hoping for the US to come back to TPP. But I think in general, in terms of security; the US is very committed to the region. So, we are not really worried about it and for example the issue of North Korea; I think the trilateral commitment among US, Japan and South Korea is very solid and we are working on North Korea to change the policy. So, I think the Trump administration; well there are a lot of issues but when it comes to the Asia Pacific or when it comes to the relationship between Japan and the United States, I think it's very stable and their commitment is real.&nbsp;

WION: In the context of North Korea, the US seems to have taken some very unprecedented steps and decisions in terms of President Trump agreeing to a meeting with Chairman Kim and there's talk now for a second meeting and for Japan, clearly whatever happens around North Korea is of deep interest including the issue of abduction of Japanese personnel and security concerns. Are you comfortable that the US has kept you fully informed about what they're doing with North Korea and how they're planning the next step?&nbsp;

Kōno: Yes, Secretary Pompeo and the Foreign Minister Kang of South Korea and myself get together regularly and exchange the views and we are very solid and I think if North Korea makes right decisions, there is going to be a bright future for that country. So, a lot of things is now up to Mr. Kim Jong-un. If he makes the right decision for his country, Japan is ready to normalise the relationship with North Korea once they solve the issue of missile nuclear and abduction issues. We are ready to provide economic assistance to North Korea just like we did to South Korea in the past. So we are all waiting for his decisions and we are very grateful for the international community is united behind the U.N. Security Council resolution. So, I think President Trump is taking very strong leadership on this issue and we are waiting for their second summit meeting, it will be another breakthrough in this issue.&nbsp;

WION:Europe is another very important leg in the Western alliance system and Europe at the moment seems to be going through its own challenges. There is Brexit happening, For a long time, Germany and Angela Merkel were seen as leaders for Europe, setting the norms. She seems to have been weakened. The French President Macron who was seen at one stage as emerging as the new voice in Europe, he seems to have been weakened domestically. So, is there concern in Japan about the strength of the voice from Europe including because of the rise of right-wing forces, authoritarian tendencies in some countries. How are you seeing that and how is Japan looking at dealing with that challenge?

Kōno: Well, Europe is for democracy, rule of law, basic human rights. We share a lot of common values, you know. Europe, Japan, India; we are in the same boat I think and we welcome strongly united Europe. The Brexit and the possible no-deal Brexit worries us. It's true, but we hope that they could take care of that issue and I think it's time for Japan, Europe, India, and other democratic countries to share a little bit more burden to keep this liberal international order going. I think we have sort of relied on US bit too much, too long. Now the US is asking for some help, I think it's time for us to get a little bit more burden on our shoulder and EU and Japan conclude EPA and Strategic partnership agreement. So EU-Japan EPA is another signal that we are standing firm with the free trade regime and would like to convey the strong signal to the whole world. So, strong Europe, united Europe is welcome and we are for expansion of EU to the Balkan countries. So, I think Europe with a long history of democracy could take care of those issues and stand united.&nbsp;

WION:Expansion of Europe, expansion of NATO, of course, causes a lot of concern to Russia and Russia is an important political and defence partner of India. Japan has an important relationship with Russia. There's the issue of the islands since the Second World War. What's your sense of what can be done to improve really the situation between US and Russia, Western Europe and Russia so as to lessen Russia's increasing dependence on China which would be in the interest of neither the US nor Europe nor Japan and India?&nbsp;

Kōno: Well since the end of the Cold War, Russia is no longer a security threat in East Asia and Russia could offer a lot of energy to Japan. Natural gas, electricity and all those things. So, Russia and Japan could be a natural partner in some area and Russia is a good friend of India for many years so there are probably a lot of things we can do together trilaterally and I'm very much looking forward to that. Now Prime Minister Abe has agreed with President Putin to expedite the process of concluding the peace treaty. 70 years after the war, we still haven't got a peace treaty with Russia. Now, I'm actually going to Moscow next week to start a new round of peace treaty negotiations and there are a lot of things we could invest in, especially Siberia Far East and there are a lot of things we can do together. So, I think it's good to have Russia on our side and I'm very optimistic.&nbsp;

WION:Well, I wish you good luck for your visit and the negotiations and as our discussion showed; there is a lot of convergence between India and Japan including because of our shared values and interests. I want to thank you for the effort you are making for advancing this relationship and thank you for joining this show.&nbsp;

Kōno: Thank you very much.

The 10th India-Japan Foreign Minister-level Strategic Dialogue was held between External Affairs Minister Sushma Swaraj and her Japanese counterpart Tarō Kōno on Monday in New Delhi.

The 10th India-Japan Foreign Minister-level Strategic Dialogue was held between External Affairs Minister Sushma Swaraj and her Japanese counterpart Tarō Kōno on Monday in New Delhi. During the Strategic Dialogue, India and Japan agreed that Kōno's visit to India provides an opportunity for the nations to identify agendas in bilateral relations in 2019. He was on an official three-day visit to India from January 7 to January 9. Speaking to former Indian ambassador to the US Arun K Singh on WION's 'The Diplomacy Show', Kono said, "India has a huge potential and it is a growing economy with a young population. So it's good to have a very friendly relationship with India and Japan and India could be a natural ally in terms of our economy and defence and security." WION: You are visiting India and is this the first time you have come to India or you've been here before? Kōno: Well, this is the first time as a Foreign Minister. But, I have been to New Delhi and Mumbai before. Your government kindly invited my wife and I two years ago. So I visited New Delhi and Mumbai and before that, I attended a conference on energy policy. So it's good to be back. WION: So you have had an engagement with India from before and although you've been Foreign Minister for a little over a year. And you'd have interacted with Indian leaders, I think you hosted the Indian Foreign Minister in Japan last year. Kōno: Yes. WION:The Indian Prime Minister was there in October but this is your first time as the Foreign Minister. Dealing with the relationship in that capacity and visiting India, what are the impressions you have formed. Where are we in the relationship? Kōno: Well, India has a huge potential and it is a growing economy with a young population. So it's good to have a very friendly relationship with India and Japan and India could be a natural ally in terms of our economy and defence and security. So I'm very glad to be able to visit India as a Foreign Minister. WION:Both countries have now described the relationship as a special strategic and global partnership. Is that designation justified? Kōno: I think so. India is the largest democracy on this planet and India and Japan share many common values, democracy, human rights, rule of law and we are strategically, I think aligned very nicely. So I think we need to work hard to develop this special strategic relationship into the future. WION: In the statement that has been put out by the Japanese Foreign Ministry after your meetings here with your counterpart; the Foreign Minister and the Prime Minister. It has been said that India is the most important partner for Japan in the context of the free and open Indo-Pacific. Why is that? Kōno: Well, India is the largest recipient of our ODA (Official Development Assistance) and Japan is now the third largest investor in India. More than fifteen hundred Japanese companies are now very active in the Indian market and India as well and I think keeping free and open sea lines of communication is vital to the economic prosperity in not only Asia but for Africa, the Middle East, all the way across the Pacific to the western coast of the United States and we share common values of this free and open Indo-Pacific vision and India is the most important partner to making it happen. We need to work on connectivity for economic prosperity and also we need to work together to keep the law enforcement capacity of the countries along the coast and we can work together on this issue as well. So this relationship needs to be stronger and I think it is natural to say this is the most important partnership to make a 'free and open Indo-Pacific' happen. WION: You referred to the important investment by the Japanese companies in India, the large number of Japanese companies present here, but if you look at the trade relationship and the total trade seems to be in the order of about 16 billion dollars. What more can we do to enhance our trading partnership? Kōno: Well, we are now working on RCEP. We hope to conclude this negotiation by the end of 2019. Also, we concluded TPP (Trans-Pacific Partnership) negotiations and India is welcome to join TPP. So now there is a lot of protectionism rising all over the world. But I think we can work to keep free and open trade and I think that is beneficial for India and Japan as well. WION: Defence is one area where India and Japan are looking at doing more and more. We have now agreed to hold the two plus two dialogue of foreign and defence ministers. There is a defence policy dialogue. We do a large number of exercises including the Malabar series of exercises. What can be done in terms of enhancing defence cooperation in terms of trade in defence or technology partnership? What's your sense of what are the obstacles there? Kōno: When Prime Minister Modi visited Japan last year, we agreed to start two plus two ministerial meeting process and we are holding a dialogue on cyber, dialogue on space. As you mentioned, the Japanese Maritime Self-defence Force are participating officially in Malabar exercise and Indian Army-Air Force is working with Japanese self-defence forces in joint exercises. So there is a lot of cooperation between our Self-defence Force and Indian armed forces. At the same time there are a lot of things we can do to get the defence industry going and so there is a lot of potential and creating very strong relationship between Japan and India or plus the US or even Australia will bring stability in this Indo-Pacific region and I think stability is a cornerstone for the economic prosperity of this region. So having a good, stable relationship between Japan and India, we can build on a lot of things on this fundamentals. WION:Certainly, and in the context of the Indo-Pacific; we have the trilateral meetings between India, US and Japan and I think you along with your US and Indian colleague had a meeting in New York and the Indian and the Japanese Prime Minister had a meeting with President Trump recently in the framework of the G-20. So, how are you seeing the potential for the trilateral partnership in the context to Indo-Pacific and the Quadrilateral involving Australia? Kōno: We had a summit meeting among the three countries in Buenos Aires at G-20 and probably this year in Osaka during the G-20 summit, there's gonna be another trilateral summit meeting. So, this trilateral relationship will be getting stronger and we can coordinate defence and security policy, we can coordinate economic policy as well and plus we are now having DG (Director General) level meeting including Australia. WION:Okay. Kōno: So, this is a new mechanism for this region to keep this free and open trade, free and open sea lines of communication. So it could be a good vehicle to build a multilateral relationship. WION:As countries are looking at new frameworks for interaction, new architectures for security and other forms of cooperation in the Indo-Pacific. Clearly, they're also looking at the rise of China; the economic, the technological, the military rise of China, its assertiveness be it in the South China Sea, the East China Sea, the Senkaku Islands. How are you looking at the challenge from the rise of China as far as Japan is concerned and in terms of Japan's interests and globally how should the world react and deal with that? Kōno: Well for last 40 years, the Japanese government, as well as Japanese private sector, helped the Chinese economy to grow. I think a stable growth of the Chinese economy according to the existing international order will give great opportunity for many other economies to prosper. But unfortunately, there is some disagreement with China such as protecting intellectual property right or industrial subsidies or sort of - forced technology transfer. So, we need to get China to play the game according to the international rule; but if China comes back to stable growth and they play the same game, it will provide a lot of opportunity for the region. At the same time, they are violating our territorial water in the East China Sea and their action in the South China Sea needs to be corrected. So on those fundamental issues, Japan has no intention to concede. I think we need to get China engaged in the International framework and try to get China to play according to the international rules. So, it is important to cooperate among US, Japan, India or another country and get China to play within their existing liberal international order, that will create a lot of opportunity. WION:Many have argued that the fact that the Chinese economic system is essentially based on state-owned enterprises and therefore; the manner in which they compete with private sector-led economies does not quite meet the WTO (World Trade Organisation) framework and rules and norms. So how can one deal with that challenge? Kōno: Well, a lot of economic issues need to be solved within the framework of WTO. We are trying to get US, Europe, Japan, and another like-minded country to modernize the WTO. I think we need to address the issue of e-commerce and all those things need to be addressed within the framework of WTO. So, at the same time, we need to modernize WTO better. We need to ask each country; China, US, and others to play the game according to the WTO rules. WION: The relations with the United States are a very critical relationship for Japan since the Second World War. It's a very important security partner for Japan but of late there are voices emerging from the US; challenging or questioning US commitment to its allies, partners, security commitment. Given that, has that caused some anxiety concern in Japan about how the US is looking at its evolving role in the global context, in the context of the Asia-Pacific? Kōno: Well, I think the alliance between Japan and the United States is the cornerstone for security policy of Japan and President Trump and his administration's commitment to Asia or the Asia Pacific is still very strong in terms of security and defence policy. It is unfortunate that Washington left TPP and we are still hoping for the US to come back to TPP. But I think in general, in terms of security; the US is very committed to the region. So, we are not really worried about it and for example the issue of North Korea; I think the trilateral commitment among US, Japan and South Korea is very solid and we are working on North Korea to change the policy. So, I think the Trump administration; well there are a lot of issues but when it comes to the Asia Pacific or when it comes to the relationship between Japan and the United States, I think it's very stable and their commitment is real. WION: In the context of North Korea, the US seems to have taken some very unprecedented steps and decisions in terms of President Trump agreeing to a meeting with Chairman Kim and there's talk now for a second meeting and for Japan, clearly whatever happens around North Korea is of deep interest including the issue of abduction of Japanese personnel and security concerns. Are you comfortable that the US has kept you fully informed about what they're doing with North Korea and how they're planning the next step? Kōno: Yes, Secretary Pompeo and the Foreign Minister Kang of South Korea and myself get together regularly and exchange the views and we are very solid and I think if North Korea makes right decisions, there is going to be a bright future for that country. So, a lot of things is now up to Mr. Kim Jong-un. If he makes the right decision for his country, Japan is ready to normalise the relationship with North Korea once they solve the issue of missile nuclear and abduction issues. We are ready to provide economic assistance to North Korea just like we did to South Korea in the past. So we are all waiting for his decisions and we are very grateful for the international community is united behind the U.N. Security Council resolution. So, I think President Trump is taking very strong leadership on this issue and we are waiting for their second summit meeting, it will be another breakthrough in this issue. WION:Europe is another very important leg in the Western alliance system and Europe at the moment seems to be going through its own challenges. There is Brexit happening, For a long time, Germany and Angela Merkel were seen as leaders for Europe, setting the norms. She seems to have been weakened. The French President Macron who was seen at one stage as emerging as the new voice in Europe, he seems to have been weakened domestically. So, is there concern in Japan about the strength of the voice from Europe including because of the rise of right-wing forces, authoritarian tendencies in some countries. How are you seeing that and how is Japan looking at dealing with that challenge? Kōno: Well, Europe is for democracy, rule of law, basic human rights. We share a lot of common values, you know. Europe, Japan, India; we are in the same boat I think and we welcome strongly united Europe. The Brexit and the possible no-deal Brexit worries us. It's true, but we hope that they could take care of that issue and I think it's time for Japan, Europe, India, and other democratic countries to share a little bit more burden to keep this liberal international order going. I think we have sort of relied on US bit too much, too long. Now the US is asking for some help, I think it's time for us to get a little bit more burden on our shoulder and EU and Japan conclude EPA and Strategic partnership agreement. So EU-Japan EPA is another signal that we are standing firm with the free trade regime and would like to convey the strong signal to the whole world. So, strong Europe, united Europe is welcome and we are for expansion of EU to the Balkan countries. So, I think Europe with a long history of democracy could take care of those issues and stand united. WION:Expansion of Europe, expansion of NATO, of course, causes a lot of concern to Russia and Russia is an important political and defence partner of India. Japan has an important relationship with Russia. There's the issue of the islands since the Second World War. What's your sense of what can be done to improve really the situation between US and Russia, Western Europe and Russia so as to lessen Russia's increasing dependence on China which would be in the interest of neither the US nor Europe nor Japan and India? Kōno: Well since the end of the Cold War, Russia is no longer a security threat in East Asia and Russia could offer a lot of energy to Japan. Natural gas, electricity and all those things. So, Russia and Japan could be a natural partner in some area and Russia is a good friend of India for many years so there are probably a lot of things we can do together trilaterally and I'm very much looking forward to that. Now Prime Minister Abe has agreed with President Putin to expedite the process of concluding the peace treaty. 70 years after the war, we still haven't got a peace treaty with Russia. Now, I'm actually going to Moscow next week to start a new round of peace treaty negotiations and there are a lot of things we could invest in, especially Siberia Far East and there are a lot of things we can do together. So, I think it's good to have Russia on our side and I'm very optimistic. WION:Well, I wish you good luck for your visit and the negotiations and as our discussion showed; there is a lot of convergence between India and Japan including because of our shared values and interests. I want to thank you for the effort you are making for advancing this relationship and thank you for joining this show. Kōno: Thank you very much.

India a growing economy with a young population and huge potential: Japan Foreign Minister on WION's The Diplomacy Show

Finance Minister Arun Jaitley on Monday tabled the economic survey in Parliament which noted that the reform measures undertaken in 2017-18 can be strengthened further in 2018-19. The survey points out that India can be rated as among the best performing economies in the world as the average growth during last three years is around four percentage points higher than global growth and nearly three percentage points higher than that of emerging market and developing economies.

It said that the GDP growth has averaged 7.3 per cent from 2014-15 to 2017-18, which is the highest among the major economies of the world.

Here are the key takeaways from economic survey 2017-18:

GROWTH

<ul>
	<li>India&#39;s gross domestic product (GDP) growth for 2018-19 pegged at 7-7.5 per cent, current high oil prices a major concern.</li>
	<li>GDP to expand by 6.75% in 2017-18, re-instating India as world&#39;s fastest growing major economy.</li>
	<li>Economic management will be challenging in the coming year.</li>
	<li>Biggest source of upside to growth to be from exports.</li>
	<li>Cyclical conditions may lead to lower tax and non-tax revenues in 2017-18.</li>
	<li>Private investment poised for rebound.</li>
	<li>2017-18 farm sector growth seen at 2.1 per cent.</li>
</ul>

FISCAL DEFICIT

<ul>
	<li>Target for fiscal consolidation specially in a pre-election year can carry a high risk of credibility</li>
	<li>Current account deficit for 2017/18 expected to average 1.5-2 per cent of GDP</li>
	<li>Pause in general govt fiscal consolidation cannot be ruled out in 2017-18</li>
	<li>Suggests modest (fiscal) consolidation that signals a return to the path of gradual but steady deficit reductions</li>
</ul>

INFLATION, POLICY RATES

<ul>
	<li>Persistently high oil prices remain a key risk, to affect inflation</li>
	<li>If inflation doesn`t deviate from current levels policy rates can be expected to remain stable</li>
	<li>Average CPI inflation seen at 3.7 per cent in 2017-18</li>
</ul>

OTHER HIGHLIGHTS

<ul>
	<li>Economy accelerated in second half of current fiscal due to GST, bank recapitalisation, liberalisation of FDI and higher exports.</li>
	<li>Gross Value Added (GVA) expected to grow by 6.1 per cent in 2017-18 as compared to 6.6 per cent in 2016-17.</li>
	<li>Preliminary analysis of the Goods and Services Tax (GST) data reveals 50% increase in the number of indirect taxpayers.</li>
	<li>There is need to address pendency, delays and backlogs in the appellate and judicial arenas.</li>
	<li>&quot;Policy vigilance&quot; in coming year if high oil prices persist or stock prices correct sharply.</li>
	<li>India has performed better on 14 out of 17 key indicators.</li>
</ul>

The survey points out that India can be rated as among the best performing economies in the world as the average growth during last three years is around four percentage points higher than global growth.

Finance Minister Arun Jaitley on Monday tabled the economic survey in Parliament which noted that the reform measures undertaken in 2017-18 can be strengthened further in 2018-19. The survey points out that India can be rated as among the best performing economies in the world as the average growth during last three years is around four percentage points higher than global growth and nearly three percentage points higher than that of emerging market and developing economies. It said that the GDP growth has averaged 7.3 per cent from 2014-15 to 2017-18, which is the highest among the major economies of the world. Here are the key takeaways from economic survey 2017-18: GROWTH India's gross domestic product (GDP) growth for 2018-19 pegged at 7-7.5 per cent, current high oil prices a major concern. GDP to expand by 6.75% in 2017-18, re-instating India as world's fastest growing major economy. Economic management will be challenging in the coming year. Biggest source of upside to growth to be from exports. Cyclical conditions may lead to lower tax and non-tax revenues in 2017-18. Private investment poised for rebound. 2017-18 farm sector growth seen at 2.1 per cent. FISCAL DEFICIT Target for fiscal consolidation specially in a pre-election year can carry a high risk of credibility Current account deficit for 2017/18 expected to average 1.5-2 per cent of GDP Pause in general govt fiscal consolidation cannot be ruled out in 2017-18 Suggests modest (fiscal) consolidation that signals a return to the path of gradual but steady deficit reductions INFLATION, POLICY RATES Persistently high oil prices remain a key risk, to affect inflation If inflation doesn`t deviate from current levels policy rates can be expected to remain stable Average CPI inflation seen at 3.7 per cent in 2017-18 OTHER HIGHLIGHTS Economy accelerated in second half of current fiscal due to GST, bank recapitalisation, liberalisation of FDI and higher exports. Gross Value Added (GVA) expected to grow by 6.1 per cent in 2017-18 as compared to 6.6 per cent in 2016-17. Preliminary analysis of the Goods and Services Tax (GST) data reveals 50% increase in the number of indirect taxpayers. There is need to address pendency, delays and backlogs in the appellate and judicial arenas. "Policy vigilance" in coming year if high oil prices persist or stock prices correct sharply. India has performed better on 14 out of 17 key indicators.

Big takeaways from economic survey

The economic growth is expected to slow to a four-year low of 6.5 per cent in 2017-18, the lowest under the Modi-led government, mainly due to poor performance of agriculture and manufacturing sectors.

The Gross Domestic Product (GDP) was 7.1 per cent in 2016-17 and 8 per cent in the preceding year. It was 7.5 per cent in 2014-15.

The Narendra Modi-led NDA government had assumed office in May 2014.

&quot;The growth in GDP during 2017-18 is estimated at 6.5 per cent as compared to the growth rate of 7.1 per cent in 2016- 17,&quot; said the Central Statistics Office (CSO) while announcing the first advance estimates of National Income 2017-18.

The growth of real Gross Value Added (GVA) in 2017-18 is anticipated at 6.1 per cent as against 6.6 per cent in the previous year.

Economic activities were affected by demonetisation announced on November 8, 2016 and subsequent implementation of a new indirect tax regime (GST) from July 1 in the current financial year.

As per the CSO data, the expansion in activities in &#39;agriculture, forestry and fishing&#39; is likely to slow to 2.1 per cent in the current fiscal from 4.9 per cent in the preceding year.

The growth in manufacturing sector too is expected to decelerate to 4.6 per cent this fiscal, down from 7.9 per cent in 2016-17.

The Gross Domestic Product (GDP) was 7.1 per cent in 2016-17 and 8 per cent in the preceding year. It was 7.5 per cent in 2014-15.

The economic growth is expected to slow to a four-year low of 6.5 per cent in 2017-18, the lowest under the Modi-led government, mainly due to poor performance of agriculture and manufacturing sectors. The Gross Domestic Product (GDP) was 7.1 per cent in 2016-17 and 8 per cent in the preceding year. It was 7.5 per cent in 2014-15. The Narendra Modi-led NDA government had assumed office in May 2014. "The growth in GDP during 2017-18 is estimated at 6.5 per cent as compared to the growth rate of 7.1 per cent in 2016- 17," said the Central Statistics Office (CSO) while announcing the first advance estimates of National Income 2017-18. The growth of real Gross Value Added (GVA) in 2017-18 is anticipated at 6.1 per cent as against 6.6 per cent in the previous year. Economic activities were affected by demonetisation announced on November 8, 2016 and subsequent implementation of a new indirect tax regime (GST) from July 1 in the current financial year. As per the CSO data, the expansion in activities in 'agriculture, forestry and fishing' is likely to slow to 2.1 per cent in the current fiscal from 4.9 per cent in the preceding year. The growth in manufacturing sector too is expected to decelerate to 4.6 per cent this fiscal, down from 7.9 per cent in 2016-17.

India's GDP growth to slow to four-year low of 6.5% in 2017-18

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