wealthy countries can't pay no attention to budding nations: RBI chief Raghuram Rajan

Asserting that India is well located to climate monetary crisis, RBI Governor Raghuram Rajan on Sunday said the central banks of urbanized nations must also keep in brain budding nations while framing monetary policies.
"I don't think we can proceed to the fore proverb one and all is in their own boat and they descend or swim alone," he said in position to the need for sophisticated nations, like the US, to take heed of countries susceptible to the incentive withdrawal.

Make stronger reforms, slash subsidies for economic recovery: Rangarajan

 
Underlining the necessitate for pump-priming the wealth by increasing reforms and decoration subsidies, Prime Minister's Economic consultative committee Chairman C Rangarajan on Monday said if India grew at 8 to 9 per cent every year, per capita GDP would rise to $10,000 by 2025.

He said that if this expansion rate was achieved "then India will also shipment from life form a squat profits to a focal point profits realm".

The renowned economist and previous RBI governor was talking on the topic "Indian Economy: instantaneous Challenges and middle Term Concerns" while delivering a sermon on NALCO's institution day.

Emphasising the need to conquer the present low expansion phase as rapidly as probable, Rangarajan said increase was the reply to many of the country's socio-monetary problems and more than a few schemes meant at expansion the pedestal of increase had been launched lately.

Stating that raising reserves and asset might take India back to the extremely elevated levels of expansion seen previous, he said calming price rises, containing present explanation shortage and ensuring economic consolidation were the main tasks requiring abrupt awareness.

While pains must be complete to hoist returns-GDP proportion, it is vital to check expenditures, above all subsidies which need to be pruned, well focussed and prioritised," Rangarajan says adding up "it is up to the government to choose which subsidies must take partiality over others."

What is wanted is to have a fasten on the quantum of subsidies to be provided as a quantity of GDP or of government returns, he said referring to government's hint at dipping subsidies from 2.6 per cent of GDP in 2012-13 to 1.6 per cent of GDP in 2015-16.

Chidambaram confident of restricting fiscal deficit to 4.8%

 
Unperturbed by the rise in the fiscal deficit, Finance Minister P Chidambaram on Thursday exuded confidence that it would remain within the target of 4.8 per cent of GDP in the current financial year.

"We will maintain the fiscal deficit at 4.8 per cent.

That is the red line that will not be breached. I am confident that it will not be breached," he said at a press conference.

The minister was responding to a question about the possibility of the fiscal deficit rising after it touched 94 per cent of the budget estimate at the end of November.

Chidambaram said government finances will improve in December and the fiscal deficit will decline.

Advance tax receipts came in December and the General Financial Rules, which restrict expenditure, will come into play, he said, adding that they would have a positive bearing on the fiscal deficit.

The government has proposed narrowing the fiscal deficit to 4.8 per cent in the current financial year and 3 per cent in 2016-17. It was at 4.9 per cent in 2012-13.

The government, however, will have a tough task in restricting the fiscal deficit in view of poor revenue realisation and tardy progress of the disinvestment programme.

There are indications that the government would go in for a massive cut of about Rs 1 lakh crore in plan expenditure to contain the fiscal deficit.

The government has so far received Rs 3,000 crore from disinvestment as against the budget target of Rs 40,000 crore.

India's fiscal deficit touched Rs 5,09,557 crore during April-November, or 93.9 per cent of the annual target, the Controller General of Accounts (CGA) said on December 31. The gap was 80.4 per cent of the budget estimate at the end of November in 2012-13.

The target for the fiscal deficit -- the gap between expenditure and reveune -- was set at Rs 5,42,499 crore for this financial year.

India Ratings says reserves to expand impetus position 2014 polls

 


India Ratings' chief Atul Joshi has said foreign reserves are set to expand thrust after 2014 general elections, but a 'enchantment' work is not likely for the generally financial system in the abrupt prospect.
India Ratings is the Indian entity of universal enormous Fitch Ratings cluster.

Many foreign nest egg are being in custody back as investors are meeting on the hedge for a new government to be bent, but their decisions are improbable to be reliant on any fastidious get-together coming to the influence and would be frequently made on the basis of governance solidity, he said.

Asked whether trade and industry tricks will gain thrust after common elections, India Ratings & Research's Managing Director and CEO, Joshi said: "It will gain energy and definitely some funds are being in custody back".

He said that no large-scale greenfield projects are imminent up, since of a stipulate decelerate as well as the corporates in India creature over-leveraged in requisites of arrears.

Joshi auxiliary said that Indian corporates "need to set their house in order... The corporates need to leave go of their own control. That is a big rationale for corporates not setting up fresh projects. Let's not fault the government single-handedly. The corporates also have a part in that."

India Ratings' chief Atul Joshi has said foreign investments are set to gain momentum after 2014 general elections, but a 'magic' work is unlikely for the overall economy in the immediate future.

India Ratings is the Indian unit of global giant Fitch Ratings group.

Many foreign investments are being held back as investors are sitting on the fence for a new government to be formed, but their decisions are unlikely to be dependent on any particular party coming to the power and would be mostly made on the basis of governance stability, he said.

Asked whether economic activities will gain momentum after general elections, India Ratings & Research's Managing Director and CEO, Joshi said: "It will gain momentum and certainly some investments are being held back".

He said that no large-scale greenfield projects are coming up, because of a demand slowdown as well as the corporates in India being over-leveraged in terms of debt.

Joshi further said that Indian corporates "need to set their house in order... The corporates need to release their own leverage. That is a big reason for corporates not setting up new projects. Let's not blame the government alone. The corporates also have a role in that."

Reduced wealth derails scheduling Commission's 8 pc expansion object in 12th Plan

 

Poor presentation of the saving during 2013 derailed Planning Commission's ambitious growth target of 8 per cent for the 12th Plan, which the nation's official think-tank will revise downwards in the new year as part of its mid-term evaluation exercise.

During the first year of the 12th Plan, India's saving grew by only 5 per cent, the slowest in a decade. In the first half (April-September) of the in progress financial year 2013-14, the economy grew by just 4.6 per cent.

Attributing lower-than-expected growth to worldwide factors, Planning Commission Deputy Chairman Montek Singh Ahluwalia said 12th Plan's growth target could be lowered to around 7.5 per cent.

"In the 12th Plan for the first time, upper-end concert was going to be just about 8 per cent normal in a year but since then universal economy has done much inferior. So, today 8 per cent is bit on the high side. The opportunity for next five years I feel is 7.5 per cent which is not unworkable," he said

Indian economy sees positive change in growth momentum: OECD

Indian economy is seeing a tentative positive change in momentum while most of the major economies are witnessing improved growth prospects, Paris-based think tank OECD said on Monday. Besides India, China and Russia too are showing similar trends. "In the emerging economies, the CLIs point to growth around trend in Brazil and to a tentative positive change in momentum in China, Russia and India," OECD said. The Organisation for Economic Cooperation and Development (OECD ) is a grouping of mostly developed nations. The latest conclusions are based on its Composite Leading Indicators (CLIs), that are designed to anticipate turning points in economic activity. India registered a higher-than-expected economic growth of 4.8 per cent in the September quarter, helped by better agriculture and factory output. In the June quarter, GDP expansion had touched a four-year low of 4.4 per cent. According to OECD, India's CLI in October stood at 97.6 unchanged from the previous month. The level was the same in July and August as well. "CLI for Canada indicates a positive change in momentum. In the US, the CLI points to growth around trend. In the euro area as a whole, in France and in Italy, the CLIs continue to indicate a positive change in momentum," OECD said.