Manmohan Singh lures NRI's giving sops for investing in India

At the start of 7th Pravasi Bhartiya Divas (PBD) in Chennai on Thursday, Prime Minister Manmohan Singh announced a slew of policy measures for the benefit of overseas Indians. These included allowing overseas Indian citizenship (OCI) card holders to practise in India, launching a global Indian knowledge network as a virtual think tank, issuing smart card to all overseas Indian workers.

The prime minister said the overseas Indian citizenship scheme announced in 2006, got an overwhelming response. He also announced that OCI card holders — who are qualified professionals such as doctors, dentists, pharmacies, engineers, architects and chartered accountants — can practise unhindered in India. Further details to operationalise the benefits are being worked out.

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Dr Singh also launched a new initiative called “The global Indian knowledge network”. It will connect people of Indian origin from a variety of disciplines to users at the national, state and local levels in India. “My hope is that the network will facilitate transfer of knowledge and serve as a virtual think tank to generate new ideas on issues such as development, education and healthcare,” he said.

He also referred to the contributions of about five million Indian workers in the Gulf countries. “I have seen their contributions when I recently visited Oman and Qatar. I was amazed to see their grit, their determination and how they are contributing magnificently to processes of wealth creation in these countries,” he said.

He said: “We are there concerned at the rise of tensions in the region as a result of the attack in Gaza that has led to the needless loss of lives of many innocent men, women and children. India has strongly condemned these incidents and it is our hope that the international community would get together and help to restore peace in the region as soon as possible. I wish to reiterate our unstinted and unwavering support for the just Palestinian cause.”

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“We have put in place several measures for better protection and welfare of our workers overseas, including entering into inter-government agreements,” he added.

He also said India had launched a comprehensive e-governance project on migration. Under this project, every worker will be issued a ‘a smart card’ that will contain all details of the worker like his work contract, his employer, his insurance and the like.

The data will also be available to the government as well as its missions overseas. The objective is to transform emigration process into a simple, transparent, orderly and humane one.

posted under - Indian economic updates, 7th Pravasi Bhartiya Divas ,Pravasi Bhartiya Divas , PM updates, economy of india updates, indian rupee updates
source - economictimes.com

Rupee turns stronger gains 52 paise v/s US $

The rupee had fallen to a one-month low of 49.28 against the dollar in early trade after the scandal in India's fourth-largest software exporter Satyam Computer sparked fears about capital outflows.

Resuming weaker at 49.20/21 a dollar from its previous close of 48.80/81 a dollar, the rupee later fluctuated between 48.28 and 49.28 during the day, partly influenced by movements in local stocks.

Dealers at the Interbank Foreign Exchange (forex) market said foreign and private sector banks heavily sold dollars in the latter part of the day amid reports that foreign investments may not be affected in the aftermath of the country's biggest corporate fraud. Leading fund managers reportedly ruled out the possibility of any capital outflow because of the Satyam scandal.

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Despite the dollar's firmness against major world currencies in global markets, they said a sudden bout of dollar sales led a strong recovery in the rupee, which was under pressure in early trade due to weakness in equity markets.

The rupee also drew support from the absence of any dollar demand from oil refiners during the day.

posted under - economy of india, indian economy blog, indian economy updates, inr updates, inr v/s US $

Indian Government gives green signal to 34 FDI proposals

The government has cleared 34 Foreign Direct Investment (FDI) proposals worth about Rs 1,615 crore of firms like Mahindra and Mahindra, Sumitomo Corporation, and Barwah International from Qatar.

The largest investment proposals are in urban development, by HBS Realtors Mumbai, which intends to invest Rs 300 crore to convert the operating company into a operating-cum-holding company and Qatar-based Barwa International, which would invest Rs 400 crore.

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Besides, Sumitomo Corporation from Japan would invest Rs 160 crore, but its proposal would be subject to norms laid down in Press Note one, the government said.

Meanwhile, another proposal from Universal Biofuels for an investment of Rs 200 crore was cleared, and it would incorporate and make downstream investment
in subsidiaries and also issue and allot equity.

posted under - Indian economy updates, economy of india, indian govt steps, indian economy blog, economy of india, indian FDI updates.

Indian Exports fell by 1.6% in December 2008

Exports fell for the third straight month, posting a negative growth of 1.6 per cent in December 2008 as demand from key markets
continued to remain sluggish.

Revenue from exports during the month under review stood at 11.2 bn from 11.3 bn in the year ago period, an official said.

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Exports had fallen over 12 per cent in October, the first decline in five years, and dropped 9.9 per cent in November.

Steel, textile, gems and jewellery and handicrafts were an area of concern and were the worse hit as global demand for steel, textile fell due to ongoing crises in major market for indian exports - US.

posted under - Indian exports, indian economy updates, economy of india, economic crises updates, effect of crises on India, indian exports updates

Reserve Bank to cut Interest rates even more

Reserve Bank of India ( RBI) could cut interest rates by another 150 basis points by mid-2009 as authorities fight to prop up sagging growth, but the central Rates bank is unlikely to seek zero rates like the United States and Japan even as deflation rears its head.

The Reserve Bank of India cut interest rates on Friday for the fourth time since the global financial crisis blew up in September, taking the total reduction in its key lending rate or the repo rate to 350 points. It now stands at 5.50 percent.

Other central banks have slashed rates heavily too to fight off the deepest global financial crisis in decades. The US Federal Reserve and Japan have cut their rates close to zero, sparking debate on how far central banks will have to go to revive their economies.


posted under - RBI updates, Reserve Bank of India, Indian Interest Rates, Indian Economy, Economy under recession, Indian Economy updates
source- www.economictimes.com

Indian Economy - Most Optimistic Economy of World

India has regained top slot in optimism among privately held businesses for 2009. While optimism amongst privately held businesses (PHBs) around
the world slumped by 56% over the last 12 months, pushing the Grant Thornton International optimism/pessimism barometer to a record negative balance of -16% compared to +40%, this time last year.

Despite raging pessimism, the survey found that PHBs from 11 countries remained optimistic about the outlook for their economies, with India leading this group (+83%), and Botswana (+81%) with Brazil (+50%) also emerging on the top. Japan (-85%) and Spain (-65%) were the most pessimistic.

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It is the first time that pessimists have outweighed optimists about the outlook for their economy since the research began in the current form in 2003 but this year's International Business Report
, which surveyed senior executives from over 7,000 PHBs across 36 economies, also shows an overwhelming consensus that falling consumer demand is the biggest threat to PHB businesses.

There are also some startling differences in attitude towards the economic crisis between the mature and emerging economies. Of the four largest trading nations, PHBs in the United States and mainland China, who together contribute over 32% of global GDP1, scored their optimism at -34% in the United States and +30% in Mainland China.

Similarly, Japan and India (collectively contributing over 11% of global GDP) scored their optimism at -85% and +83% respectively.

"These polarised results suggest that despite the current slowdown, there are still pockets of hope in the global marketplace for PHBs," explained Vishesh Chandiok, National Managing Partner – Grant Thornton India.

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"Their macro view of the world economic stage explains the overall slump in optimism but there are still signs of optimism in some economies and also clear signs that PHBs, while preparing for the downturn, are also seeking to leverage on opportunities this could bring," Mr Chandiok added.

When asked to identify the most significant factors causing most concern for their business, PHBs in 33 out of the 36 economies cited a fall in consumer demand, while citing a shortage of business credit as a secondary concern.

posted under - Indian Economy Updates, Economy of India, India, Asian Economies, optimistic economy of world, indian business updates, economy, india economy
source - www.economictimes.com

RBI cuts rate further - will economy be boosted??

The Reserve Bank of India on Friday cut key policy rates. The repo and the reserve repo rate under the liquidity adjustment facility RBI has been cut by 100 basis points while cash reserve ratio (CRR) has been reduced by 50 bps.

Following this move, reverse repo stands at 4%, repo stands at 5.5% and CRR now stands at 5%. The cut in CRR will infuse Rs 20,000 crore in the system.

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The market had widely expected RBI to cut the key lending rates. The cut in repo and reserve repo is with immediate effect while CRR cut will be effective from fortnight beginning January 17. Since August RBI cut CRR by 450 basis.

Repo rate is the rate at which banks borrow from RBI while the reverse repo is the rate which RBI gives banks for parking their surplus funds. These two rates are seen as the floor and the cap for daily call money movement.

The decisions would among other things infuse Rs 20,000 crore into the banking system.

Both reductions are effective immediately. The repo rate has been cut aggressively since mid-October last year as the central bank tried to minimise the knock-on effects of the global financial crisis.

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posted under - RBI updates, effect of recession on india, indian economy, economy of india, india economy updates, Reserve bank of india, Indian economy updates, indian rupee updates

US $ v/s rs daily updates - January 2009

Indian economy trends are very important for those who are into economic analysis in India, Indian National rupee popularly known as INR in international market is following a downward trend due to global financial turbulance. As volume of US dollars (USD) in international markets is on a decline so the value of US $ is growing up, well indian IT industrycan feel better to some extent and is the only industry which would be getting a plus from current market scenario.

The post would include (US$ v/$ rupee) daily trends the rate shown of Indian rupee would be as displayed at time of stock markets closure(mainly BSE and NSE) you can also see daily Stock market live rates and closing rates.

INR(Indian National rupee) v/s US$ November trends/updates are as follows:

format for display of rs v/s $ would be in following order:

(date | RS v/s $ rate Daily trends updates | Remarks with respect to US $)


28/1/2009 | 48.85 | Up^0.34 | Rupee (INR) grew stronger by 34 paise wrto US $

22/1/2009 | 48.56 | - | Rupee (INR) fell weaker by - paise wrto US $

21/1/2009 | 48.56 | Down(0.00) | Rupee (INR) fell weaker by - paise wrto US $

20/1/2009 | 48.56 | Up^0.21 | Rupee (INR) grew stronger by 21 paise wrto US $

19/1/2009 | 48.77 | Up^0.31 | Rupee (INR) grew stronger by 38 paise wrto US $

16/1/2009 | 49.08 | Down(0.38) | Rupee (INR) fell weaker by 38 paise wrto US $

15/1/2009 | 48.70 | Up^0.10 | Rupee (INR) grew stronger by 10 paise wrto US $

9/1/2009 | 48.61 | Up^0.07 | Rupee (INR) grew stronger by 7 paise wrto US $

7/1/2009 | 48.68 | Down(0.31) | Rupee (INR) fell weaker by 31 paise wrto US $

2/1/2009 | 48.73 | Down(0.23) | Rupee (INR) fell weaker by 23 paise wrto US $

1/1/2009 | 48.50 | Up^0.05 | Rupee (INR) grew stronger by 5 paise wrto US $

Indian Govt Fiscal Deficit Increases

The Economy of India's fiscal deficit for year 2008-09 has increased when compared to previous year, following statistics show the grim picture of economy which is in high deficit. It is to mention that i had already predicted the fiscal deficit to rise in one of my previous post.

The difference between total receipts and expenditure is Rs 1,76,510 crore up to November 2008 in the current financial year.

This year the government is spending more than originally budgeted on social sector, subsidies and infrastructure development.

Policy makers believe that the rising fiscal deficit is not a matter of concern. Suresh Tendulkar, Chairman ,Prime Minister's Economic Advisory Council said," Private investment activity is very low as of now.So there is no question of fiscal deficit crowding out private investment activity and fiscal deficit need not be looked at as a major concern."

Home minister P Chidambaram already indicated that the government may require one more year to eliminate revenue deficit and reduce fiscal deficit below 3% as required by the Fiscal Responsibility and Budgetary Management Act."This is not a year to worry about fiscal deficit," the minister said.

The revenue deficit continued to surpass estimates for the whole year by 256.2%. It stood at Rs 1,41,364 during April-November 2008 as against Rs 55,184 for the entire fiscal. It may be pointed that a substantial part of the government's spending takes place in the first half of the fiscal.

The center's revenue stood at Rs 3,14,974 crore during first eight months accounting for 52.2% of estimated figure for the entire year against 56.5% a year ago. Most of the revenue came from taxes at Rs 2,53,558 crore. Expenditure stood at Rs 4,94,124 crore, constituting 65.8% of what is pegged for the entire year , up from 60.5% in a year ago period. Much of the expenditure comes under the non-plan head at Rs 3,57,994 crore constituting 70.5% of estimated figure for the year. Plan expenditure stood at Rs 1,36,160 crore ,which represents 55.9% of Rs 2,43,386 crore budgeted for the year.