Survey shows India Inc firmly in Modi camp

 
Subhadip Sircar and Suvashree Dey Choudhury in Mumbai

Nearly three-quarters of Indian business leaders believe the government has mismanaged the economy and want opposition leader Narendra Modi to lead the country after an election due by May next year, according to an opinion poll published on Friday.
With India's 80-year-old Prime Minister Manmohan Singh expected to step aside, only 7 per cent of 100 chief executive officers surveyed for the Economic Times/Nielsen poll backed the ruling Congress party's Rahul Gandhi for the premiership.
Rahul represents the fourth generation of the Nehru-Gandhi dynasty that has led Congress, and India, for much of the time since independence from Britain in 1947. His late father, grandmother and great-grandfather were all prime ministers.
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Image: Gujarat's chief minister Narendra Modi (L) and Anil Ambani, chairman of Reliance Group, embrace as Ratan Tata, chairman Emeritus of Tata group, looks on during the inauguration ceremony of the Vibrant Gujarat global investor summit at Gandhinagar in the western Indian state of Gujarat

Stagflation: Biggest challenge for Raghuram Rajan

 
Andy Mukherjee

Rajan's call to diaspora can't stem rupee rout, says Andy Mukherjee.
Raghuram Rajan's first move as India's monetary czar has been to solemnise a marriage between a needy country and its greedy diaspora. That's the easy part.

Tackling the gruelling Indian stagflation will be the real test for the former International Monetary Fund chief economist.
Rajan, who presciently warned developed nations about a risky buildup of leverage in 2005, began his career as a central banker in Mumbai on September 4 by reaching out for the low-hanging fruit: the monetary authority, he said, will charge local lenders a fixed 3.5 per cent annual fee to convert new long-term dollar deposits from expat Indians into rupees.

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Image: Raghuram Rajan (L), newly appointed governor of Reserve Bank of India (RBI), hugs the outgoing governor Duvvuri Subbarao during the taking over ceremony at the bank's headquarters in Mumbai.

India has 55.48 cr mobile owners, 14.32 cr Internet users

New Delhi: There are 55.48 crore actual mobile users in the country and 14.32 crore internet users, according to a study by research firm Juxt.

"India has 55.48 crore mobile users as per our India Mobile Landscape (IML) 2013 study. More than 29.8 crore, about 54 percent, of these device owners are in rural areas as compared to 25.6 crore in cities and towns," Juxt co-founder Mrutyunjay told PTI.

There are total 77.39 crore functional SIMs with validity but only 64.34 SIMs are being used by 55.48 crore mobile devices owners, the study report said.

IML study finds that there are 14.32 crore internet users in the country.

"The number of unique Internet users in India, who access Internet from their desktop or laptop, smart TV or mobile data connections together stand at around 94.7 million. But when one adds the number of users who also access Internet through operators portals such as Airtel Live and Reliance R World, the number goes up to 143.2 million," Mrutyunjay said.

The study found 2.38 crore individuals access Internet from their mobile phones using a data connection such as GPRS or 3G. Out of this, 93 lakh access Internet only through mobile phones and around 77 percent of these users are in rural areas.

Talking about size of survey, he said that the field survey was conducted between May and mid-July 2013 covering 109 urban centres and 196 villages in all the 28 states and 3 union territories in India.

"It (survey) covered 80 of the 88 regions as classified by the National Sample Survey Organisation under the Ministry of Statistics and Program Implementation. The study sample represents 94.8 percent of the Indian population and 96.1 percent of the total Indian households," he said.

Meanwhile, as per the data revealed by sectoral regulator Trai, there are total 87.33 crore mobile subscribers in the country. Of this, 73.14 crore customers were found to be active on a particular date in June.

The cumulative revenue of telecom service providers was Rs 54,284 crore in the January-March quarter as per TRAI data.

China's trade strengthens as exports rise 7.2 %

Beijing: Global trading giant China's exports rose 7.2 percent in August year on year to USD 190.73 billion, fired mainly by Christmas and New Year orders to EU and US whose economies are showing signs of recovery.

The exports growth rate was 2.1 percentage points higher than July, figures released by China's General Administration of Customs said today.

Imports also saw a spurt in August, gaining 7 percent to USD 162.12 billion. Total foreign trade grew 7.1 percent in August over the same month of 2012 to USD 352.85 billion, the statement added.

Similarly, trade surplus widened by 8.3 percent year on year to USD 28.61 billion as export gains outpaced import gains, state-run Xinhua news agency reported.

In August, trade with the European Union, China's largest trading partner, rose by 3.2 percent, while that with the United States, China's second-largest trade partner, witnessed upward swing by 9.2 percent.

Analysts attribute the exports increase to heavy orders for the Christmas and New Year festive season in the western countries, which normally takes place in August and closes September.

China has emerged as the main global exporter of commodities for the annual festive season for over a decade.

The increase to EU and US markets were considered significant as China's economic slowed down to 7.5 percent mainly after the slump in their economies, which had a big negative impact on China's exports, the main stay of the country's economy.

Also China's trade with ASEAN (Association of Southeast Asian Nations) members increased 13.2 percent in August. But trade with Japan shrank 5.7 percent during the period as the two countries continue to squabble over the disputed islands in the East China Sea, which is having its toll on bilateral trade.

Exports of electronics and machinery products also grew by 6.8 percent to reach USD 106.54 billion in August, accounting for 55.9 percent of the total exports.

The recovery of exports comes at a time when China planned to deepen its economic reforms to halt the slowdown of its economy, which shrank to 7.5 percent in the second quarter with chances of missing this year's target of 7.5 percent growth.

Rupee fall has forex reserves plunging $16.5 bn since April

Mumbai: RBI's fight to prop the tottering rupee has contributed substantially to forex reserves dipping by a hefty USD 16.554 billion or 6 percent to a low of USD 275.49 billion since the beginning of this fiscal.

According to marketmen, a large part of this has been used to save the bleeding rupee, which went on a downward spiral after May 22 when Ben Bernanke of the US Fed had hinted at turning his easy money policy much earlier than previously hinted.

According to the latest Reserve Bank data, forex reserves plunged to USD 275.491 billion to the week ending August 30, which is a near 6 percent fall from USD 292.646 billion as of March 29.

The rupee opened the fiscal at 54.25 to the US dollar but fell to a life-time low of 68.86 on August 28, losing nearly a third of its value. However, since the new RBI Governor Raghuram Govind Rajan took over the affairs of the Mint Street on September 4, the rupee has been on a winning streak, and closed the last trade on Friday at 65.24 to the dollar.

On a weekly basis, the reserves dropped by USD 2.2 billion as of August 30, marking a three-year low, the RBI data showed.

Overall, the foreign currency assets have fallen more to the tune of USD 3.08 billion to USD 247.40 billion in the week ended August 30.

The Reserve Bank was net seller of the dollar twice this year in May and June, according to its monthly data.

In June this year, RBI sold USD 2.252 billion net of the US currency, while in May it sold USD 107 million dollars.

Looking at the steep fall in the overall numbers, marketmen said, it could be surmised that the central bank has intervened in a much more heavier and frequent manner in the forex market in July and August, as these two months saw the rupee plunging to new lows.

According to forex dealers, RBI not only intervened in May and June, but was present in the market all through July and August when rupee was touching new lows.

The rupee has been in free-fall territory since May 22 when the US Federal Reserve said it would slow and finally taper of its monthly USD 85 billion buyback of government debt or withdraw its easy money policy called quantitative easing.

The announcement led to a massive selling by the overseas investors in the country's debt and equity markets, to the tune of nearly USD 15 billion, mostly from the debt market.

To save the rupee, the central bank had announced various liquidity tightening measures starting July 15, including steeply hiking call money rates and partly bringing back capital control.