Indian Economy : News,Discussions & Updates

_Anonymous_ said:
You couldn't be further from the truth here. The ordinary B'deshis don't like Indians at all & I'm not referring to the aam semi literate menial Abduls but the professional classes there too. Take it from me. It's personal experience speaking. Of myself & friends & colleagues.

In the long run, if we've to settle the illegal migrants problem from B'desh in WB & all over the NE, it'd definitely lead to a souring of relations with them. Before we get to that we need to tackle Paxtan & unfortunately as of now China. B'desh is receptive to us for 1 & 1 reason only & that's coz of SHW & her ANP. You take SHW out of the equation & you'd see BD showing it's true colours.

In any case she isn't going to last forever. We need her time be there right till 2030. Hopefully by then we'd be able to tackle the Paxtan problem once & for all & with it China. If we don't , then by 2030 we'd be surrounded on all 3 sides by hostile powers. I don't even want to imagine what the situation will be like then.
Click to expand...

It is not helped much by people (even so called experts) fawning over the BD "stats" and the level of inflation they dump in them (if you compare to base consumption of raw inputs esp like Energy).

The consumption argument is of course only used to nitpick India's GDP (Arvind Subramaniam's correlation analysis being a well known one)..but never anyone else in the same way that the same ppl fawn over (i.e suppose the narrative that INDIA BAD, everyone else GOOD gets a beating if you do).

This happens for two reasons (with BD), ...both direct inflation (that gets counted as real value) but also indirect ...in that the mismatch between their export profile (and quantity) earned in the USD that they then extrapolate to the "Taka economy" in 1:1 way (very faultily)....i.e this extrapolation would be lot more intrinsically accurate only if BD people consumption activity was 90% RMG too.

GDP (nominal) itself is very overrated even in developed world but given the heavy USD liquidity+reference permeation there (to all corners) at least countries can be somewhat compared....but in developing low-trade countries its pretty awful as it just depends which countries are more honest with their actual inflation accounting.

India can and should try improve relations with BD and keep relations good with quarters it already is in good terms with there....but India also need to be also very honest and as clear about the huge amount of garbage that goes on in BD politically, socially and economically...rather than give them some pass that we do not for even our own (i.e inflation, low econometry standards, anti-intellectualism, extremism and illegals). Otherwise we simply learn the wrong lessons and cause more damage to ourselves downstream like we did by not dealing with a huge problem in 1971 when the window was clearly open for it to go all the way.
 
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Nilgiri said:
It is not helped much by people (even so called experts) fawning over the BD "stats" and the level of inflation they dump in them (if you compare to base consumption of raw inputs esp like Energy).

The consumption argument is of course only used to nitpick India's GDP (Arvind Subramaniam's correlation analysis being a well known one)..but never anyone else in the same way that the same ppl fawn over (i.e suppose the narrative that INDIA BAD, everyone else GOOD gets a beating if you do).

This happens for two reasons (with BD), ...both direct inflation (that gets counted as real value) but also indirect ...in that the mismatch between their export profile (and quantity) earned in the USD that they then extrapolate to the "Taka economy" in 1:1 way (very faultily)....i.e this extrapolation would be lot more intrinsically accurate only if BD people consumption activity was 90% RMG too.

GDP (nominal) itself is very overrated even in developed world but given the heavy USD liquidity+reference permeation there (to all corners) at least countries can be somewhat compared....but in developing low-trade countries its pretty awful as it just depends which countries are more honest with their actual inflation accounting.

India can and should try improve relations with BD and keep relations good with quarters it already is in good terms with there....but India also need to be also very honest and as clear about the huge amount of garbage that goes on in BD politically, socially and economically...rather than give them some pass that we do not for even our own (i.e inflation, low econometry standards, anti-intellectualism, extremism and illegals). Otherwise we simply learn the wrong lessons and cause more damage to ourselves downstream like we did by not dealing with a huge problem in 1971 when the window was clearly open for it to go all the way.
Click to expand...

I was waiting for your analysis on this.

And BTW long time no see.
 
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_Anonymous_ said:
You couldn't be further from the truth here. The ordinary B'deshis don't like Indians at all & I'm not referring to the aam semi literate menial Abduls but the professional classes there too. Take it from me. It's personal experience speaking. Of myself & friends & colleagues.

In the long run, if we've to settle the illegal migrants problem from B'desh in WB & all over the NE, it'd definitely lead to a souring of relations with them. Before we get to that we need to tackle Paxtan & unfortunately as of now China. B'desh is receptive to us for 1 & 1 reason only & that's coz of SHW & her ANP. You take SHW out of the equation & you'd see BD showing it's true colours.

In any case she isn't going to last forever. We need her time be there right till 2030. Hopefully by then we'd be able to tackle the Paxtan problem once & for all & with it China. If we don't , then by 2030 we'd be surrounded on all 3 sides by hostile powers. I don't even want to imagine what the situation will be like then.
Click to expand...
Plus they have the greater Bangladesh going on in their nationalist circles. The richer Bangladesh gets the bigger problem it will become for us. Unfortunately mamata is deliberately trying to push Bangladeshi agenda. I wouldn't discount a secessionist movement led by Mamata the way she is pushing illegal Bangladeshis into W.B. Plus they have been slowly arming themselves. We have to use Myanmar against BD and making a huge MIC is important to control BD and Pakistan.
 

Exports Have Bounced Back Sharply After The Covid-19 Lockdown; India Needs The Momentum To Continue​


by Aashish Chandorkar
Oct 27, 2020 10:39 AM
1603952033402.png

Indian exports bouncing back. (representative image) (GettyImages)​

Snapshot​

  • Despite disruptions across the supply chain, it is heartening to see the Indian exporters getting their act together in the last couple of months.
  • The export increase to the US and the trade deficit narrowing with China is good news.
  • Sustaining this over the full year will be key to building on the idea of Aatmanirbhar Bharat.

Exports earnings form a key high frequency economic indicator. September 2020 was the first month of goods export rise after a six month falling streak. Exports registered almost 6 per cent year on year growth over September 2019 and hit the $27.58 billion mark.

In a Covid-19 pandemic-marred year, this is a good sign. Indian exports have recovered much faster than imports, indicating an operational resilience in a very tough year. Not only did the lockdowns created day to day hassles for manufacturers, the global demand itself has been under pressure with all major buying centres for Indian goods witnessing their own economic slowdown.

In fact in June this year, India recorded its first-ever trade surplus since January 2002. That was the era when India did not depend much on Chinese imports and was taking small steps in capturing some of the merchandise markets. But it was all downhill since then, until the pandemic-led dynamics produced a $790 million trade surplus this year.

Exports bouncing back to normal also come with two additional data points — the exports to China and to the United States.

Indian exports to China grew from $8.4 billion in the first six months of the financial year 2019-20 to $10.3 billion in the same period of the financial year 2020-21. This 26.3 per cent per cent growth in exports helped India narrow down the trade deficit with China, with imports reducing too on the other side.

The increase in exports was mainly contributed by engineering goods, which grew almost 94 per cent in value terms and iron core, which grew 178 per cent in value terms.

The former is good news for the Indian medium and small enterprises. The latter is mixed news — eventually India needs to focus on capturing the more valuable parts of the manufacturing value chain. For the mining industry, it would mean greater steel production and export.

While India has seen four straight months of exports increase to China from May to August, the imports have been declining. More Indian firms than before are looking to decouple from China and the initial ramp up in manufacturing in India is now being seen with the incentives under the Aatmanirbhar Bharat programme kicking in.

The trade deficit with China in the first five months of this financial year until August has narrowed to $12.6 billion. This deficit was $22.6 billion in financial year 2019-20, $23.5 billion in 2018-19 and $26.33 billion in 2017-18.

India’s trade deficit with China peaked in the financial year ending March 2017 at about $63 billion. The deficit has been narrowing since then, but the sharpest decline will be observed in the current financial year ending March 2021.

The exports to the US in September grew 15.5 per cent from $4.4 billion in 2019 to $5.1 billion in 2020. The rise was contributed mainly by engineering goods which grew 17.6 per cent and gems and jewellery which grew 15.8 per cent. This was a good bounce back as so far this financial year, exports to the US were down by 24.6 per cent.

The revival in September marked consumption demand returning to the American market. The growth categories also help Indian medium and small firms and jewellery traders, who have had a washout year so far, with retail business locked down globally for several months.

India has also benefited from export of essential agriculture commodities this year, with the category posting a 43 per cent growth from April to September this financial year compared to the same period of the previous financial year. Exports of basmati and non-basmati rice variants have seen a big increase this year.

While the stabilisation and growth of Indian exports is good news, the headwinds are hardly over. In fact, there are some new issues to be resolved as the global shipping starts to normalise. After the global shutdown was lifted, shipping containers lying idle in many ports are yet to find their way to usual destinations.

With limited transportation resuming, the number of container ships calling on Indian ports has also been limited. This has led to more than 60 per cent hike in freight costs out of India to major global ports. With the air traffic also normalising slowly, the throughput capacity has been throttled.

The Commerce Ministry officials are trying to solve the issue of increased freight costs and high demurrage charges exporters are currently bearing. But the freight costs may stay elevated for the next couple of months until shipping patterns normalise.

Exporters as well as importers have complained of longer customs clearance times, which have gone up from the usual 15 to 20 days to 25 to 30 days now. The new faceless assessment process put in place by the government is yet to fully stabilise, so while the change in process itself is welcome, it has caused near-term pain.

Finally, the farmer protests in Punjab in the last few weeks also led to holding up of export consignments, compounding the issue of goods not reaching the ports even as the shipping of goods remained slow and costly.

With Indian industry fully up and running, it is important that Indian exports pick up in areas like textiles and engineering goods. The Indian export competitiveness will be tested in these categories where we compete with smaller Asian countries.

These industries are also labour intensive, which adds to the job market normalisation. As several of Indian export destinations are witnessing a second wave of the Covid-19 pandemic, the uncertainty may continue for some more time.

With the government looking to capitalise on the global trade momentum away from China, next few months will be crucial for Indian exports. Not only this year’s trade picture needs to improve, but there’s also a directional one-time opportunity to tap.

Nonetheless, despite all the issues and disruptions across the supply chain, it is heartening to see the Indian exporters getting their act together in the last couple of months. The export increase to the US and the trade deficit narrowing with China is good news. Sustaining this over the full year will be key to building on the idea of Aatmanirbhar Bharat.

swarajyamag.com

Exports Have Bounced Back Sharply After The Covid-19 Lockdown; India Needs The Momentum To Continue

Despite disruptions across the supply chain, it is heartening to see the Indian exporters getting their act together in the last couple of months. The export increase to the US and the trade deficit narrowing with China is good news. Sustaining this over the full year will be key to building on...
swarajyamag.com
 

Indian economy accelerates in September as animal spirits soar​


By Bloomberg | Updated: Oct 28, 2020, 23:17 IST

NEW DELHI: India’s economy picked up speed in September as a revival in demand and business activity helped drive the South Asian nation toward recovery from the pandemic-induced slump.

Five of the eight high-frequency indicators, including exports, tracked by Bloomberg News improved last month, while three were steady. That helped move the needle on a dial measuring the so-called ‘Animal Spirits’ to 5 from 4 in August - a level arrived at by using the three-month weighted average to smooth out volatility in the single-month readings.

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Economists, including those at the Reserve Bank of India, attributed the recovery to pent-up demand after a strict lockdown imposed in March to contain the coronavirus outbreak hit the consumption of goods and services. While inventory re-stocking will underpin business activity in the coming months, the improvement might still not be enough to prevent Asia’s third-largest economy from contracting in the financial year to March 2021.

Business activity

Activity in India’s dominant services sector continued to recover, with the main index rising to 49.8 in September from 41.8 in August. While that’s a marked improvement from April’s record low of 5.4, a number below 50 suggests it’s still in contraction territory and will probably be a drag on overall growth in the July-September quarter.

Manufacturing activity was a bright spot, with the purchasing managers index rising to 56.8 -- the highest reading since January 2012 -- on the back of a sharp expansion in new work orders, according to IHS Markit. This helped the composite index back into expansion territory -- at 54.6 -- after five months of contraction.

1603952386840.png


Exports

Exports returned to positive territory with shipments rising 6% in September from a year earlier. Farm exports and shipments of drugs and pharmaceuticals helped the recovery, with engineering goods and chemicals also adding to the rise. A contraction in imports moderated, resulting in a narrowing of the trade deficit.

1603952368316.png


Consumer activity

Passenger vehicle sales, a key indicator of demand, rose 26.5% in September from a year ago. Retail sales too showed signs of stabilizing, even though it was nearly 70% below the year-ago level, according to ShopperTrak. That was mainly because consumer confidence remained in the dumps, an RBI survey showed, with respondents worried about jobs, loss of income and stubbornly high inflation.

1603952275530.png


Demand for loans also remained sluggish. Central bank data showed credit grew 5.2% in September from a year earlier, slightly lower than 5.5% in the previous month, and nearly half of the growth rates seen a year ago. Tighter liquidity conditions prevailed in September, although there were signs of slight easing toward the end of the month.

Industrial activity

Industrial production fell 8% in August from a year earlier, shallower than July’s revised 10.8% contraction. Capital goods output -- another key indicator of demand in the economy -- dropped 15.8% from a year earlier, although that’s milder than the 22.8% drop seen a month earlier.

Output at infrastructure industries shrank 8.5% in August from a year ago and was slightly worse than the revised 8% decline in July. The sector, which makes up 40% of the industrial production index, had contracted by a record 37.9% in April. Both data are published with a one-month lag.

timesofindia.indiatimes.com

Indian economy accelerates in September as animal spirits soar - Times of India

India Business News: India’s economy picked up speed in September as a revival in demand and business activity helped drive the South Asian nation toward recovery from the
timesofindia.indiatimes.com timesofindia.indiatimes.com
 
Govt expands PLI scheme: India seeks to cull China reliance with latest move to boost bulk drug manufacturing

By Times Now Digital
Updated Oct 30, 2020 | 11:36 IST

The latest amendments to the Centre's Production-Linked Incentive scheme come on the heels of several complaints received by the Department of Pharmaceuticals claiming that the scheme was too restrictive.
1604136659798.png

KEY HIGHLIGHTS​

  • India's pharma industry is, reportedly, the 3rd largest in the world by volume, and the 14th largest in terms of value
  • Indian pharmaceutical companies rely on Chinese API imports for roughly 70 per cent of their total bulk drugs requirement
  • According to reports, as of October 8, the Department of Pharmaceuticals (DoP) had received as many as 29 applications to the PLI scheme from India's pharma companies

The central government, on Thursday, decided to remove the criteria of 'minimum investment' and 'barring exports' in the Production-Linked Incentive scheme aimed to strengthen India's indigenous production of pharmaceutical raw materials. The move is specifically geared to further encourage increased production of active pharmaceutical ingredients (APIs) required in the manufacture of medicines.

In late July this year, the government notified the PLI scheme as India's pharmaceutical industry reeled from major supply-chain disruptions encountered due to the COVID-19 outbreak in China, and the stringent lockdown measures imposed. India's pharma industry is, reportedly, the 3rd largest in the world by volume, and the 14th largest in terms of value.

Yet, although it contributes approximately 3.5 per cent of total drugs and medicines exported across the world, its import dependency on China for APIs has been much cautioned against. Bulk drugs, or APIs, are the raw materials required to make formulations or medicines. China, reportedly, controls 55 per cent of the global API space. Indian pharmaceutical companies rely on Chinese API imports for roughly 70 per cent of their total bulk drugs requirement.

The government's approval of the PLI scheme in March was aimed to address this over-dependency which has been brutally exposed by the COVID-19 pandemic. Under the scheme, which runs for 6 years starting with the base year of FY 2019-20, financial incentives will be provided based on the sales of pharma manufacturers for 41 products covering all of India's required 53 APIs. Applicable only for greenfield projects, the total financial outlay for the scheme is Rs 6,940 crore.

According to reports, as of October 8, the Department of Pharmaceuticals (DoP) had received as many as 29 applications to the PLI scheme from India's pharma companies. However, several bulk drug manufacturers had complained that the scheme was too restrictive.

The DoP had received several recommendations from pharma manufacturers to amend the scheme by removing the minimum investment limit of Rs 400 crore for the manufacturing of four fermentation-based bulk drugs, and Rs 20-50 crore for the manufacturing of 37 other bulk drugs. With the latest relaxations on the minimum investment criterion, it appears that the DoP has paid heed to the concerns of India's pharma manufacturers.

While the PLI scheme is indeed a significant step forward toward enabling the pharma industry to become 'Aatmanirbhar,' several challenges do remain. Industry experts have noted that the production of cost of APIs in China are a staggering 20 to 30 per cent less than they are in India.

As per some reports, a substantial chunk of India's API units run at just 30 per cent capacity compared to China's capacity utilisation of 70 per cent. It is widely acknowledged that the last three decades has seen India cede its production advantage in the pharma manufacturing space to China. As such, further infrastructural incentives and tax benefits may be required if India is to truly transform its pharma industry into one characterised by self-reliance.

www.timesnownews.com

Govt expands PLI scheme: India seeks to cull China reliance with latest move to boost bulk drug manufacturing

The latest amendments to the Centre's Production-Linked Incentive scheme come on the heels of several complaints received by the Department of Pharmaceuticals claiming that the scheme was too restrictive.
www.timesnownews.com www.timesnownews.com
 
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October manufacturing PMI points to strongest output growth in over a decade​


Updated: 02 Nov 2020, 11:48 AM IST
By Gireesh Chandra Prasad

Rising from 56.8 in September to 58.9 in October, the headline seasonally adjusted PMI pointed to the strongest improvement in the health of the sector in over a decade
1604326650568.png

The index is compiled from responses in the second half of the month from around 400 manufacturers, which indicates the direction of change compared to the previous month. (HT)

NEW DELHI: India's manufacturing output showed the strongest growth in 13 years in October amid robust sales growth, IHS Markit India purchasing managers’ index showed, indicating economic recovery was gaining ground after the lifting of lockdown restrictions.

Rising to 58.9 in October from 56.8 in September, the headline seasonally adjusted PMI pointed to the strongest improvement in the health of the sector in over a decade, the information provider said in a statement on Monday. A reading above 50 shows expansion from the previous month.

The index is compiled from responses in the second half of the month from around 400 manufacturers, which indicates the direction of change compared to the previous month.

The IHS Markit India statement said growth was led by the intermediate goods category, but there were also robust expansions in the consumer and investment goods sub-sectors.

Manufacturers indicated that the ongoing relaxation of Covid-19 restrictions, better market conditions and improved demand helped them secure new work in October. Also, the upturn in sales was the strongest since mid-2008. New export orders too rose at a quicker pace, one that was the most pronounced in close to six years, said the company.

Greater production needs led to another monthly increase in input buying among Indian manufacturers. Moreover, quantities of purchases rose at the quickest pace in just under nine years. Inflationary pressures, meanwhile, remained subdued as seen by a modest increase in input costs and only marginal rise in selling prices, the statement said.

The data conforms to a strong jump in e-way bills for October indicating that more goods were shipped within and across states in the month. Generation of e-way bills (electronic permits for goods movement) in October was 21% higher than what was generated in October 2019 and 11% higher than what was generated in September this year. This early indicator suggests increased economic activity in October, Mint reported on Monday.

India’s industrial output for the month of August too had shown a trend of economic recovery. Factory output had contracted at a slower 8% in August compared to a 10.8% contraction July.

“Levels of new orders and output at Indian manufacturers continued to recover from the Covid-19 induced contractions seen earlier in the year, with the PMI results for October highlighting historically-sharp monthly rates of expansion," the statement said quoting Pollyanna De Lima, economics associate director at IHS Markit. Companies were convinced that the resurgence in sales will be sustained in coming months, as indicated by a strong upturn in input buying amid restocking efforts, said Lima.

www.livemint.com

October manufacturing PMI points to strongest output growth in over a decade

Rising from 56.8 in September to 58.9 in October, the headline seasonally adjusted PMI pointed to the strongest improvement in the health of the sector in over a decade
www.livemint.com www.livemint.com
 

Japan to offer aid to 2 companies moving manufacturing base from China to India​


TNN | Nov 6, 2020, 03:24 IST


NEW DELHI: Japan has agreed to offer financial assistance to two companies — Toyota-Tsusho and Sumida — to diversify their manufacturing base to India as part of its recent initiative to provide subsidy to companies relocating from China.

The move was announced following Prime Minister Narendra Modi’s meeting with global investors on Thursday, sources told TOI. Modi is to follow up Thursday’s round table discussions with one-on-one meetings with the investors, including some marquee Japanese players.

Toyota-Tsusho is looking to set up a rare earth metal facility and Sumida is for automotive parts.

“Work had been going on to seek to get these companies to India but the Japanese side decided to provide assistance to make the process more attractive for the two companies,” said a government source.

India and Japan have been seeking to build a coalition to counter China’s growing dominance and the ties have been strengthened following the outbreak of the Covid-19 pandemic.

Along with Australia, India and Japan had launched supply chain resilience initiative for Indo-Pacific, where the government had also urged Tokyo to expand the coverage of the financial assistance to India.

Japan had announced a $2 billion initiative, unofficially aimed at re-shoring some of its companies as well as diversifying into other markets. While a bulk of the funding is aimed at those entities that shift from China back to Japan, India and Bangladesh are among countries where assistance will be provided.

There are an estimated 30,000 Japanese companies that have production bases in China, which had emerged as the factory to the world, compared with 5,100 in India.

Recently, Japan External Trade Organisation (JETRO) had announced that it would help 10 Japanese companies to get into high-tech projects with Indian companies. The list included the likes of Suzuki and Olympus. While Suzuki is working on IT infrastructure to develop a transit bus traffic control system in rural areas, Olympus and HCL Technologies are working on technologies to aid doctors.

timesofindia.indiatimes.com

Japanese companies in India: Japan to offer aid to 2 companies moving manufacturing base from China to India | India Business News - Times of India

India Business News: Japan has agreed to offer financial assistance to two companies — Toyota-Tsusho and Sumida — to diversify their manufacturing base to India as part of
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German Shoe Brand Von Wellx Moves Out Of China, Begins Operations In Agra

Close to 2,000 people have been employed so far and the company is slated to invest approximately ₹ 300 crore in three projects in Uttar Pradesh, sources said.

By ANI
Updated: November 06, 2020 7:32 pm IST
1604842430783.png

The German brand has collaborated with an Indian company, Latric Industries Group.

New Delhi: Amid the ongoing coronavirus pandemic, a German shoe brand, Von Wellx, recently shifted its manufacturing units from China to Agra in Uttar Pradesh. The shoe company operationalised two production units in Agra earlier this week.

Mahindra Group Chairman Anand Mahindra, meanwhile, has welcomed the German shoe brand to the country, terming it a "huge opportunity" for India. Mr Mahindra said that this "trickle" would soon turn into "a flood" of investment.

"The first few drops, which turn into a trickle, then a strong flow and finally a flood. Let's make sure we do nothing to prevent this good flood of investment. It's a huge opportunity. I hope Invest India can catalyse this," Mr Mahindra's tweet read.

The German brand has collaborated with an Indian company, Iatric Industries Group, to shift its manufacturing units to Agra's Exports Promotion Industrial Park. According to sources, close to 2,000 people have so far received employment in these units, and the company is slated to invest approximately ₹ 300 crore in three projects in UP.

Von Wellx claims it will provide direct and indirect employment to close to 10,000 people. The units will produce a total of 50 lakh pairs of shoes annually. This is a big achievement for the UP government, especially during the pandemic phase, since the whole process started just five months ago when the country was under a nationwide lockdown to curb the spread of coronavirus.

Meanwhile, UP has also taken a big leap in the Ease of Doing Business rankings among the states and is currently in the second position. Only Andhra Pradesh is ahead of UP in the list.

www.ndtv.com

German Shoe Brand Von Wellx Moves Out Of China, Begins Operations In Agra

Amid the ongoing coronavirus pandemic, a German shoe brand, Von Wellx, recently shifted its manufacturing units from China to Agra in Uttar Pradesh.
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