Indian Finance Budget 2008-09 HIGHLIGHTS!!

Highlights of the Union Finance Budget as it is being presented by Mr. P. Chitambaram :

• One time settlement agreement offered to other farmers with loans overdue on Dec 31, 2007 with a 25% discount
• Loan waiver amounts to 4% of total bank loans
• India registers growth of over 8% for 12 successive quarters till Dec 2007
• Focus on management of supply side of food, market, capital inflows next year
• Keeping inflation under check to be on focus
• NRHM to get Rs 1,250 cr budgetary allocation
• Rashtriya Swasthya Bima Yojna for 30,000 workers in organised sector in BPL category
• Two national institutes and 8 regional centres and one department of generatics in each state to be set up with an outlay of Rs 400 cr
• The remuneration Angan Bari workers has been increased from Rs 1000 cr-1500 cr per month
• NREGS to be extended to 596 rural distt with an outlay of Rs 16,000cr
• IT industry gets Rs 100 cr for connecting knowledge institutions
• Rs 200 cr for providing portable water system in each school in areas of water scarce regions
• Sanitation to get Rs 1,200 crore
• NE region to continue getting special attention
• Rajiv Gandhi drinking water mission to get Rs 7,300 cr
• 288 public sector bank branches to be opened in areas with concentration of minorities
• 54 departments to be set up gender budgeting divisions
• Child related schemes to get Rs 33,434 cr
• Schemes for woman to get Rs 1,460 cr this fiscal
• Allocation for ministry of minorities doubled to Rs 1,000 cr
• Mobilisation of additional resources of Rs 10,000 cr as planned capex under Plan-B
• LIC to cover all woman SHGs linked to the bank
• Agri credit target to be Rs 2,80,000 cr for 2008-09
• Micro irrigation scheme gets Rs 500 cr to cover 4,00,000 additional hectares
• Agriculture share in total investment up from 10.2% in 2003-04 to 16% during the 11th Plan
• Schedule Commercial Banks farm credit 75%
• Govt sets up irrigation and water resource finance corp with an initial corpus of Rs 100 cr
• National Horticulure Mission to get Rs 1,100 cr
• 500 soil testing labs to be set up in 11th plan, govt to give 1 time budgetary assistance of Rs 75 cr to agri ministry for settingt up mobile soil testing facilities
• Tea Research association gets Rs 20 cr
• National Agri Insurance scheme get Rs 640 cr
• Special purpose tea fund gets Rs 40 cr
• Debt waiver scheme and relief to small and marginal farmers
• Agri loans disbursed by rural banks, RRBs and Cooperative banks before March 2007 and overdue on Dec 2007 waived
• Marginal farmers holding 1 hectare land and small farmers holding upto 2 hectares of land to be waived
• Loan waiver amounts to 4% of total bank loans
• One time settlement agreement offered to other farmers with loans overdue on Dec 31, 2007 with a 25% discount
• Agri loans restructured in 2004-06 under special packages to be waived
• States urged to open bidding for 5 more ultra mega power projects
• All 30 integrated textile parks approved
• Rs 340 cr insurance scheme to cover 17 lakh farmers and weavers
• SITP gets 450 crore
• Rs 275 cr earmarked for state data centres
• NHDP allocation up from Rs 10,866 cr to Rs 12,966 cr
• Move towards nutrient-based fertiliser subsidy stressed
• National fund for transmission and distribution reforms for power sector
• FDI in Apr-Dec at $12.7 billion, FII inflow over $18 billion
• OTS to cost govt Rs 10,000 cr
• Farmer loan waiver to cost govt Rs 50,000 cr
• Overdue agri loans amount to Rs 50,000 cr under the waiver and 10,000 cr under the OTS
• 3 cr small and marginal farmers and 1 cr other farmers to be covered under the waiver and one time settlement scheme
• Govt asks commmercial banks to add 250 rural household accounts every year in rural and semi-urban banks
• States urged to open bidding for 5 more ultra mega power projects
• National housing bank gets Rs 1,200 cr for refinancing
• NABARD gets Rs 5,000 cr fund for refinancing
• SIDBI gets 2 funds of Rs 2,000 cr
• Requiremnet of PAN extended to all financial transactions
• Coal regulator to be established
• Rs 450 crore provision for textile parks
• Exchange traded forex, rate derivative market to be launched
• PAN to be sole identification in securities market
• 300 more ITIs to be upgraded with an investment of Rs 750 cr
• 22 Sainik schools get Rs 44 crore
• Haryana and Chandigarh to introduce smart card based delivery systen under PDS
• Revenue Deficit is Rs 55,184 cr at 1% of GDP and fiscal deficit is Rs 1,33,287 cr at 3.1% of GDP
• Estimated planned expenditure at Rs 2,43,086 cr and non-panned expenditure Rs 57,409 cr
• Central Plans Scheme monitoring system under Plan Panel to be unveiled
• Commonwealth games allocation Rs 624 crore
• One time grant of Rs 50 cr to National Tiger Conservation Authority
• Special grant of Rs 100 cr to 3 institutes of excellence
• Sixth Pay Commission report by March 31
• Defence allocation up by 10% from Rs 96,000 cr to Rs 1,56,000 cr
• 3 new schemes for unorganised sector workers social security
• PAN to be sole identification in securities market
• Exchange traded forex, rate derivative market to be launched
• Custom duty on vitamin pre-mixes to lower from 30% to 20%
• Set-top boxes to become cheaper
• Custom duty on steel scrapped
• Custom duty on some bulk drugs cut from 10% to 5%
• Import duty on Naptha restructured
• Phosphoric acid custom duty reduced to 5%
• CENVAT rates reduced from 16% to 14% on all goods
• Excise duty on small cars reduced from 16% to 12%
• Anti-Aids drug exempted from excise duty
• No excise duty on refrigerating equipments
• Bulk Cement to attract 400 per metric tonnes or 14% at adveloram, whichever is higher
• Excise on packaged softwares to lower from 8% to 12%
• Excise duty on pharma goods reduced to 8%
• Two wheelers to cost less, excise duty reduced by 10%
• Money changers and people running gains of chance and tour operators to be brought under service tax net
• Filter and non-filter cigarettes to be brought at par
• Threshold limit of tax exemption increased from Rs 1,10,000 to Rs 1,50,000 for men
• Threshold tax exemption increased from Rs 1,45,000 to Rs 1,80,000 for women
• Senior citizens threshold tax limit increased from Rs 1,95,000 to Rs 2,25,000
• Direct taxation changes to be revenue neutral
• Revenue implication of Indirect taxation to be 5900 cr
• Govt withdraws banking transaction tax
• Central sales tax cut from 3% to 2%
• For income upto Rs 1,50,000 tax liability will be nil, between Rs 1,50,000 and Rs 3,00,000 tax liability will be 10% , from 3 lakh to 5 lakh tax liability will be 20%, from 5 lakh upwards it will be 30%
• No change in surcharge of corporate tax
• 5 year tax holiday for hospitals especially in tier 2 and tier 3 cities
• 5 year tax holiday to 2,3& 4 star hotels in UNESCO declared heritage site areas
• Short term capital gains to be taxed at 15%
• Levy on STT only on option premiums
• Commodities transaction tax introduced similar to STT
• Direct taxation changes to be revenue neutral
• Revenue implication of Indirect taxation to be Rs 5900 crore
• 
  

Is Govt sucking blood of 5% taxpayers to run whole country of 125 crores??

Finance Minister Mr. P Chitambaram would present the General Union Finance Budget tomorrow in the Parliament House. It would be seventh budget presented by P. Chitambarm as the finance minister . he presented the first budget in year 1997 some 11 years ago.

It is strongly indicated that there would not be any tax rates cut in tomorrow's budget . India's population is 125 crores and it is horrible to know that the total percent of tax payers is still in single digits ~ 5 percent . There can be hike in taxes in order to compensate for this year's budget deficit.

However the policies of government need to be changed rather then such financial reforms. It is not at all good for the country like India which sucks taxes from only 5% of the population in order to subsidise or feed the rest of the population which is a huge number in excess of 100 crores.

Finance Minister has to bring more industries under the tax knife so as the burden which is imposed on 5% of population to feed the other 95% is reduced as government clearly earns from taxes and import duties which are applicable to just 5% of the total population.

Some of the individuals who are into agri business i.e. the farmers, agricultural land owners of excess then 50 acres does not pay any amount of tax to the government however they earn profits in crores which simply becomes black money which these farmers never show to government.

So Mr. P Chitambaram kindly wake up and rather then sucking blood of 5% of populaion increase the domain of tax payers by bringing the rich farmers who own more then 50 acres of cultivable land under the taxable individuals so that there remains unbiased growth of all sectors .

Indian Economy growth target is again pegged at 9% this year which would be however impossible to sustain as the year runs by. because government has stopped thinking about agricultural sector and is concentrating on the services sector which is more governed by the US economy rather then Indian Economy. Its a bitter truth anyways!!

Indian Union Railway Budget 2008-09 HIGHLIGHTS!!

Lalu Prasad yadav presented a traveller friendly railway budget yet again.
Highlights of the Union Railway Budget 2008-09 are:

• Overhead foot bridges at 195 stations and lift & escalator facilities in 50 stations
• LED display boards to be introduced
• To have online control of trains in 2009
• New stainless steel coaches on all Rajdhani trains to begin with, to be extended to all trains from 2009
• Many low and medium level platforms to be upgraded to high level
• Smart card-based ticket system on anvil
• Railways to start production of stainless steel coaches beginning 2008
• Hiked peak season rates on freight
• Railways to invest Rs 4,000 cr to add discharge-free green toilets in 36,000 coaches
• Opening of 15,000 Railway ticketing counters in next 2 years
• Tickets through mobile phones on anvil
• By 2009 call centre based inquiry services to be unveiled
• Issuance of wait-listed e-tickets to be allowed
• April-December freight loading revenues up 8%-10% at Rs 34,700 cr
• Revenue from passenger fares increased 14%
• Railway fund balance up at Rs 20,480 cr
• Dividend of Rs 88
• Operating Ratio reached 76 %
• Additional Rs 2000 cr earnings from freight services
• Cash surplus of Rs 25,000 cr in FY08
• 6000 auto-ticket sale machines by 2009
• See excess freight loading target of 310 mn in next 4 years
• Plans for 20,000 kms high-density network
• Coal freight loading seen at 336 mn tonnes
• To upgrade infrastructure in next 7 years at an investment of Rs 75,000 cr
• Steel industry to contribute 200 mn tonne tariff per year in 2011-12 from existing 120 mn tonne
• Steel coaches move to benefit JSW STL, Tata Steel, BEML, Texmacho
• 40 container terminals to be added
• Axel load trains to be started
• 200 mn loading target for cement industry in 2011-12
• 50 big terminals planned in places like Mumbai, Pune, Ghaziabad
• Automated signalling to get a boost
• Railway Minister unveiled new wagon leasing policy
• Bulk handling terminals to be unveiled
• 2000 new wagons to be added by 2009
• Delhi-JNPT-North freight corridor announced
• Concor to set up 8 depots
• No peak season surcharge on CEM transport to benefit MMPC
• Titagarh Wagons to gain from 2,000 new wagons
• PPT model with Rs 1 lakh cr investment for multi-model logistic parts
• Freight corridor to benefit Kalindee Rail
• TCS, Wipro, Satyam in foray for railway upgradation
• CCTV, metal detectors to be put up at railway stations
• Fire detection systems to be installed on trains in phased manner
• Anti-collision devices to be extended to entire railways
• All busy unmanned level crossings to be manned
• Concession from 30-50% in passenger fares in all clases for woman senior citizen
• Free MST for girl students upto graduation, boy students upto 12th
• Special concessions for AIDS patients
• Mother-Child Health Express for mobile healthcare services to mothers and children
• PPT schemes through competitive bidding to attract investment in 5 years
• 5,700 vacant posts of RPFs to be filled
• New rail coach factory in Kerala
• Chapra to get Rs 40,000 cr investment for wagon maintenance facility
• Wagon factories at Mokama and Muzaffarpur to be transferred to Indian Railways
• Railway PSUs earned a net profit of Rs 1,360 cr
• 10 new Garib Raths announced, 16 trains to be expanded and frequency of 11 trains to be increased
• New train: Chennai-Tiruchendur Express
• New train: Amravati-Mumbai Express
• Garib Rath: Delhi-Jaynagari
• Garib Rath: Jabalpur-Mumbai
• Garib Rath: Jammutavi-Kathgin
• Garib Rath: Bangalore-Kochiveli
• Garib Rath: Varanasi-Delhi
• Garib Rath: Pune- Nagpur
• Garib Rath: Yaswantpuri-Puducherry
• Garib Rath: Delhi-Jaynagari
• New train Amritsar- Kochuveli Express
• New train Malda-Patna Express
• New train Kamakhya-Gandhidham Express
• New tain Ranchi-Chopan Express
• New train Saharsha- Janasebharan Expess
• New train: Bhubaneshwar-Mumbai Express
• New train: Chennai-Tiruchendur Express
• New train: Amravati-Mumbai Express
• Garib Rath: Delhi-Jaynagari
• Phase 2 of Mumbai urban transport service to begin with investment of Rs 5,000 cr
• Target for doubling is 1000 kms in 08-09
• 2300 kms broad gauge lines to be completed this year, target for next year is 3500 kms
• 155 kms of new lines to be completed in 2007-08 , target for 2008 -09 is 350 kms
• Special train between Pune and Delhi for Commonwealth Youth Games between Oct 12-18
• New investments of Rs 35,500 cr for 2008-09
• Outlay for doubling work increased to Rs 2,500 cr
• Construction of railway line in Kashmir valley to be completed by 2009
• Non-lapsable North-East rail development fund to be created

Lalu Prasad Yadav presents railway budget in parliament (Updates)

Union Railway Minister lalu Prasad Yadav presented the railway budget for the year 2008-09 in parliament house today ie 26/2/2008 dressed in traditional Lalu style attire he looked cool and composed in his own way. He made common man happy once again as the railway budget consisted of no price hikes in any of the fares rather there were even more trains proposed this year.

It can be noted down that since Lalu Prasad became Railway minister there has been complete turn around in the fortunes of indian railways as once railways were a burden on government as it was running in huge losses from last 5-6 decades but after Lalu taking oath as the railway minister some 3 years back it has been in profit since then and that too in tune of INR 20000 crores which is a whopping amount atlast Lalu can be proud of his great achievement.

In the railway budget for year 2008-09 sops were given for students, senior citizens and common man as there was no rise in the fares and other taxes of the railways. However their is still enough slack in Indian railways that can be exploited to increase revenue without increasing the fares and taxes. Cash surplus projections of the railway budget 2008-09 stand at Rs 21578 crores. Hats off to Mr Lalu.!

Re: Hit Sector feeling Good- Govt to announce Excise Sops in Budget

The main sectros which are greatest hit by the rising rupee including: Textiles, Rubber Sector, Handlooms, Handicrafts, Leather sector and Marine sector are breathing easy as the budget 2008-09 would provide excise duty waivers and extension of the interest rates, It can be noted that these six sectors are highly labour intensive and were greatest hit by the appreciating value of indian rupee in international market, Duty is to be cut on certain sectors like leather, marine sector.

All of these sectors were witnessing a negative growth in exports from the start of the previous fiscal and the local demand also declined due to cheap imports from the other countries to India, So the small business groups of textile hubs like Ludhiana, Jallandhar, Moradabad can see a hope as these cities saw a lot of closures in the past one year.

Indian Economic Updates

Indian Economy is a volatile economy which witnessess up's and down's now and then. so such economy should be tracked daily from reliable sources so that our valuable visitor's get latest updates on Indian Economy. Indian Economic Updates(Rates) would be month wise which would be updated on daily basis .
FEBRUAURY Updates of Indian Economy:
28/2/08- Social sector may not be FM's actual focus

28/2/08- Chidambaram likely to present 'please-all' budget tomorrow

28/2/08- Economic Survey: Economy in high growth trajectory

28/2/08- FM may opt for mid-year allocations

22/2/08- New mining policy nearly ready

22/2/08- Fiscal gap narrowing but underlying stress stays

20/2/08-FM's options for achieving 9% growth

20/2/08-Direct tax collections sustain 40% growth

20/2/08-IT companies reduce wage bill in Q3: Assocham

19/2/08-Interest rates to move downwards: IBA chief

19/2/08-SEZ, promotion of industries top plan agenda

19/2/08-India's crude oil import bill jumps over 29%

18/2/08-Arshiya enters into deal with Singapore govt

18/2/08-Global financing agencies show interest in Bihar growth

18/2/08-Oil steady above $95, buoyed by supply risks

18/2/08-Though few, India-focused firms AIM big on LSE

18/2/08-Poll year may see support of Rs 10,000 cr over GBS

18/2/08-LLPs may not get total immunity for lapses

18/2/08-Insurance sector seeks 49% FDI

18/2/08-Finance Ministry likely to review BCTT in Budget 2008-09

18-2-08-Global financing agencies show interest in Bihar growth

18-2-08-Foreign PE funds may come under surveillance

18/2/08-Need to moderate tax concessions to SEZ: Rangarajan

more updates>>

Indian Economy : Dwindling Agricultural Sector | Dependent Services Sector

Indian Economy is agricultural economy with about 70% of labour doing jobs which are directly or indirectly related to the Agricultural sector , It has been seen that after the liberalisation of Indian economy in 90's the agricultural growth has come in negative and government looks still helpless. Recently according to stats released by government officials in india the growth of agricultural sector came down to under 3% whereas previous year it was more then 3% hence the future of Indian agriculture looks no good since it is showing negative growth from couple of years and government has still not come up with a concrete solution to control the dwindling agricultural output of India which is still an agricultural based economy.

After the liberalisation policies of Indian government came into effect in early 90's the growth of Indian economy has become more or less concentrated in big cities , Metros like Delhi, Bangalore, Mumbai, Kolkata, Pune, Ludhiana which comprise very less area in total , Still at grass root level there has been nothing done Indian Government boasts of the milestones it has reached but the whole growth of economy is more or less due to foreign players , Business houses which is quite evident that share markets are going down daily volatility in market is increasing.

From past decade indian economy is governed by the situation of US economy ie if the US economy grows indian markets would touch new high's and when any recession would come in US market then Indian Markets tumble down as pack of cards, So the growth of Indian economy is majorly due to foreign companies which come here for expanding there business and Indian government should know it well that they are here for making profits and profit would be in indian rupees which they would use for growin their business in some other under developed country, recently the subprime market woes has adversly affected the Indian services industry in which Indian economy had no role to play but since economy of India is governed by the US economy the effect was clear :Markets Crashed, Jobs in Services industries cut, IPO's failed and investor's lost crores of money in past couple of months.

One Question arises that what would be India's economic conditions if for a minute we forget about metros and talk about the other 85% of the land area of the country
In that case the Indian economic profile would be somewhat like this:
Country : India
Major Industry : Agriculture
Economic Growth rate: less then 3 % and is on further decline
Major Occupation : Farming, Agriculture, 85% population involved directly or indirectly
Reason: Government policies failure Government still sleeping
Future: Dark would have to borrow food crops and the overall debt would further increase.
Summary: Government needs to change the economic policies so that the growth is more even and not concentrated in and around big cites and metro's.

Time has come when India needs to learn from China- as China has developed everything on it's own without very less help of foreign currencies where as Indian economy is totally in contrast of the chineese economy...to be continued..

RS v/s Dollar February 2008 trends

Day/Date/Conversion Price(1 dollar in INR)/Remarks: (All enteries would be in same sequence respectively):
FRIDAY/29-2-2008/39.81 - Down(-0.08) (at stock market closing)

THURSDAY/28-2-2008/39.73 - Up^0.18 (at stock market closing)

WEDNESDAY/27-2-2008/39.91 - Up^0.14 (at stock market closing)

TUESDAY/26-2-2008/40.05 - Down(-0.07) (at stock market closing)

MONDAY/25-2-2008/39.98 - Up^0.09 (at stock market closing time)

FRIDAY/22-2-2008/40.07 - Up^0.07 (at stock market closing time)

THURSDAY/21-2-2008/40.15 - Down(-0.28) (at stock market closing time)

WEDNESDAY/20-2-2008/39.87 - Down(-0.21) (at stock market closing time)

TUESDAY/19-2-2008/39.66 - No Change (at stock market closing time)

MONDAY/18-2-2008/39.66 - Down(-0.01) (at stock market closing time)

FRIDAY/15-2-2008/39.65 - Up^0.03 (at stock market closing time)

THURSDAY/14-2-2008/39.68 - Down(-0.03) (at stock Market closing time)

WEDNESDAY/13-2-2008/39.65 - Up^0.08 (at 4:33 pm IST)

TUESDAY/12-2-2008/39.73 - Down(-0.18) (at stock market closing time)

MONDAY/11-2-2008/39.55 - Down(-0.07) (at stock market closing time)

FRIDAY/8-2-2008/39.48 - Up^0.12 (at stock market cloosing time)

THRUSDAY/7-2-2008/39.60 - Up^0.23 (at stock market closing time)

WEDNESDAY/6-2-2008/39.43 - Up^0.40 (at stock market closing time)

TUESDAY/5-2-2008/ 39.83 - Down(-0.47) (at stock market closing time)

US Economy Slowdown and it's effects on Indian Economy

A string of foreign banks hit by the crisis have started selling down Indian papers in the overseas market at distressed rates. In some cases, banks have refused to honour credit lines they had earlier promised. But even as corporates are reeling under the increased financing costs for their deals, some Indian banks are picking up these papers at distressed rates.One of the assets, which a few foreign banks are in a haste to sell down, is the Hindalco bridge loan, which the company had taken to acquire the Canadian firm Novelis.

Banks, which gave the loan at 61 bps above Libor, are now in the market to sell it at Libor plus 150-180 bps. Banks want to offload papers before December 31 to free their capital. Such loans, primarily for acquisition financing, are given directly by the banks, with an internal understanding that the assets would be palmed off over the next two to three months. However, because of the sub prime crisis, many of these banks were unable to get any buyer for the Indian papers. This has resulted in banks offering to sell these papers at a cheaper price. Banks have country limits and also client limits. Some banks have exceeded these limits and due to the liquidity crunch are finding it difficult to sell down these assets to other foreign banks. This has given a few Indian banks the opportunity to buy these papers.

Significantly, most foreign banks are not adding to their asset book in order to keep capital free. According to sources, a large US bank has stopped issuing letters of credit to Indian customers. It has also stopped disbursing loans to new customers. Bank officials have been told to postpone disbursals till the New Year. The urgency to prune corporate loans emanate from similar capital concerns. A couple of other corporate loans have also been sold off in the past couple of months at 15-25 bps discounts. Recently, in a deal where an Indian chemical firm was taking over an US company, the foreign bank backed out of the financing deal at the last moment. The deal was finally financed by another foreign bank.

A major US bank and a couple of European banks are said to be have been affected by the crisis. According to senior bankers, Indian banks, like ICICI Bank and SBI, have been picking up papers issued by Indian companies. A few Taiwanese and Middle East banks have also been buying these papers. However, ICICI Bank which did large dollar borrowing this year has committed new loans of around $2 billion in the past one month. Corporates are also facing the heat as borrowing costs have doubled in the past few months. Bankers point out that in many transactions, Indian corporates have now started asking Indian banks to be in the deal as they feel that some foreign banks may back out if credit woes deepen.

Source: economic times

General Union Finance Budget 2008-09

General budget for the next financial year is just a month away and already finance minister is busy with meeting all the top corporate houses and would want to make them happy and tax payers would be skeptical about the union budget.
Many questions and obstacles are in the way for continuing with the same growth rate next year.

And it looks like the finance minister is in no mood to cut the tax rates. However more emphasis would still be given to agricultural sector as always which is shattering day by day.

so what do you all feel about the general budget for 2008-09 . post your comments about what you want and what a normal middle class individual want from this budget.

However RBI has not changed any of the interest rates which has dissappointed the banks but finance minister replied to media persons that there is enough liquidity in the market and banks should encourage more loans. However a borrower should prepare himself to pay higher interest rates on the loans they get from bank.

Rupee v/s Dollar January 2008 Trends

Day/Date/Conversion Price(1 dollar in INR)/Remarks: (All enteries would be in same sequence respectively):

THURSDAY/31-01-2008/39.43/ Down 0.03 ( at 5:42 pm IST)

WEDNESDAY/30-01-2008/39.40/ Up^0.07 ( at 8:31 pm IST)

TUESDAY/29-01-2008/39.47/ Down 0.07 (at stock market close)

MONDAY/28-01-2008/39.40/ Up^0.03 (at stock market closing time)

26-01-2008, 27-01-2008 (Markets closed saturday and sunday resp.)

FRIDAY/25-01-2008/39.43/ Up^0.13 (at stock market closing time)

THURSDAY/24-01-2008/39.56/ Down 0.18 (at stock market closing time)

WEDNESDAY/23-01-2008/39.38/ No Change (at stock market closing time)

TUESDAY/22-01-2008/39.38/ Down 0.11 (at stock market closing time)

MONDAY/21-01-2008/39.27/ up ^0.02 (at stock market closing time)

FRIDAY/18-01-2008/39.29/ Down 0.02 (at stock market closing time)

THURSDAY/17-01-2008/39.27/ No Change (at stock market closing time)

WEDNESDAY/16-01-2008/39.27/ up ^0.02 (at stock market closing time)

TUESDAY/15-01-2008/39.29/ No Change (at stock market closing time)

MONDAY/14-01-2008/39.29/ No Change ( at stock market closing time)

FRIDAY/11-01-2008/39.29/ No Change (at stock market closing time)

THURSDAY/10-01-2008/39.29/ Down 0.02 (at stock market closing time)

WEDNESDAY/9-01-2008/39.27/ up ^0.01 (at stock market closing time)

TUESDAY/8-01-2008/39.28/ up ^0.04 (at stock market closing time)

MONDAY/7-01-2008/ 39.32/ no change (at stock market closing time)

SATURDAY/5-01-2008/39.32/ up ^0.13 (at stock market closing time)

FRIDAY/4-01-2008/39.45/ Down - 0.02 (at stock market closing time)

THURSDAY/3-01-2008/39.43/ Down - 0.01 (at stock market closing time)

WEDNESDAY/2-01-2008/39.42/ up ^0.01 (at stock market closing time)

Annual India Economy Update (January 2007-January 2008)

Annual India Economy Update: well all the readers of this post would be surprised about the time duration of this annual India Economy Update as it is not based on Financial year which starts in India in March every year but rather it is based on the US financial year which begins in January and ends in december every year on the new year and is according to the Earth's revolutions around sun.

Economy of India in past 1 year has grown at around 8.7% this year which is very healthy rate but is behind the economy growth rate of China which stands at around 11% for same period.

India Economy's growth rate in 2007 remained lower when compared to the growth rate of the previous year but the stock markets remained in constant bull run through out the year with both sensex and Nifty touching new highs. Bombay Stock Exchange managed to rank itself in top 10 stock markets of world in market capitalisation.

Foreign Investors showed a lot of trust in Indian rupee and hence the foreign direct investments reached a new record this year and the trend would continue for next couple of years too.

Indian rupee grew at around 5% in 2007 and hence a lot of exporters were affected as they did not do proper hedging of dollar for minimising the impact of the deteriorating dollar.

Daily Rupee Updates-Rupee V/S Dollar daily price

India Economy is Growing daily and Indian Rupee has made it's position strong so i thought to publish daily dollar price after conversion to Indian Rupee. So that every one can know about the present trends of Indian Rupee and hence Indian Economy. However it is not possible for me to update the value hourly so the rates would be after the stock market transactions end for te day, later on i can provide you with hourly updates on India Economy. for time being the latest updates would be at around 6:00 pm IST daily.

Day/Date/Conversion Price(1 dollar in INR)/Remarks: (All enteries would be in same sequence respectively):

MONDAY/31-12-07/ 39.29/ up ^ 0.14 (at 6:40 pm IST)

FRIDAY/28-12-07/39.43/ up ^0.14(at 6.58 pm IST)

WEDNESDAY/26-12-07/39.57/down 0.20(at 7:23 pm IST)

TUESDAY/25-12-07/39.37/down 0.01(at 11:00pm IST)

MONDAY/24-12-07/39.36/down 0.02(at 6:00pm IST)

SUNDAY/ 23-12-07/39.34/down 0.06(at 8:59 pm IST)

FRIDAY/ 21-12-07/39.29/ up^0.26 (at 7:04 pm IST)

THURSDAY/ 20-12-07/39.55/ up^0.02

WED/ 19-12-07/ 39.57/ no change

Slowdown in US Economy V/S Boom in India Economy

From past couple of years their has been a gradual slowdown in the economy of US. There are certain reasons for the slowdown of US Economy. With the growth of economies of Asian countries like China and India .Economy of US has a serious threat as these two asian countries have grown at a decent pace in past four to five years while at the same time the economy of US has shown a slowdown. The subprime mortagage crises occuring in US has made several mortagage companies bankrupt and hence looking into the matter the president of US Mr. George W Bush has recently decreased the rate of interest for mortagage facilities available to the people of US. It's now clearly evident that the government of US has started feeling the heat of the slowdown in it's economy. Recently a mortagage services client of indian company Infosys declared itself short of funde i.e bankrupt and had no money to pay to Infosys for the period of time . There were around 250 customer executives working for the mortagage services company in Infosys found there client bankrupt and hence they all had to be shifted to other process hence the subprime crises of US mortagage companies has started affecting the job oppurunities not only in US but also in countries like india where the processes of these banks have been outsourced. hence Slowdown in the economy of US have forced many software companies of US to outsource more and more work outside US in countries like India.

Software jobs in US are also on a decline due to the stagnation in economy. Many US based software companies have all ready opened their development centers in India as carrying business for them in US itself has become less profitable while in India their profit margins are decent and they further can outsource their projects to Indian companies. Boom in Indian Economy has helped India in reducing it's import bills drastically. with the present rate of US dollar equivalent to ~ 39.50 INR and still decreasing further. Time is not far when the economy of Indian would become major Economy of World.

Economists have predicted that if Indian Economy Grows at the Same pace as of today then it would surely surpass the net value of France, Japan by the year 2020, and would become a superpower by year 2025 and India Economy would be third largest economy of world . world would be goverened by three economies of US, China and India, by the year 2035 india economy would surpass the economies of Germany, UK and indian rupee would be used for transactions all over the world.

US market is now dependent on the imports from asian countries like china and India and the volumes of Import from India and China are on a steady rise from the past couple of years. However India economy is still net an importer economy i.e. the imports are still more then the exports but the scenario is soon going to change and India would ultimately become an export economy in coming 10 years. Boom in India Economy is clear from the amount of Foreign Direct Investments being made in India by none other then companies of US since they want higher profits for their further expansions which are not possible while carrying their businesses in US as the profit percentages in US are on a decrease and future looks no better. So these companies have shown their tremandous interest in India and India Economy which is hence on a boom.

India does not have resources of it's own and hence for development it is using the Foreign Direct Investments for it's growth conservatively which is clear as the indian rupee is getting firm day by day . Foreign players have shown tremendous interest in Indian Stock Markets and both of the indian stock exchanges The Bombay Stock Exchange and National Stock Exchange have already crossed the magical mark of 20,000 and 6,000 respectively and are still showing promising signs.

Government of India has also taken promising steps for bringing in more foreign currency to India as investment . The Incredible India campaign is an example and government has many plans to attract foreign tourists on Indian Festivals by providing certain package to the tourists.

Economy of India

Indian Economy is the second fastest growing major economy of the world. In 2007 the value of indian economy is measured to be ~1.10 trilion USD. Indian Economy is majorly dependent on agriculture and about 2/3rd of total indian population is still thriving on agriculture sector which is still not automated and majority of agricultural activities are done manually, growing indian population is a major hurdle in smooth growth of the indian economy.
Earlier there was strict government control over all the economic activities but after the liberalisation of indian economy in 90's during the Congress Rule headed by Late P.V.Narsimha Rao and present prime minister Sardar Manmohan Singh(the then finance minister in Narsimha Rao government). hence indian economy became much free and many major MNC's started to tap the potential Indian Market. It was also the same time when indian companies started making global presence and moved out of the indian subcontinent for new markets hence expanding themselves from regional companies to indian MNC's . It was also time when Reliance Industries headed by Late Mr. Dhirubai Ambani earned huge profits and made his company a global company and indian second largest business house just next to the legacy of TATA's.
Earlier there was strict government control over private companies. but after liberlisation of the indian economy the business houses started expanding on their own and are now giving stiff compitition to similar companies of the west with added advantage of cheap labour. Indian Services industry lead by Tata Consultancy Services, Infosys, Wipro, Satyam etc. are also making their mark globally and finally world has come to know the ppower of indian intellectuals the biggest example is Indra Nooyi becoming CEO of Pepsico USA.

Growing Indian economy however has become now a matter of concern for indian I.T. Industry since Indian I.T. Industry is dependent on the rate of U.S. dollar. In the past one year or so Indian Economy has grown about 10% with respect to the U.S. dollar. Stagnation in economy of United States and at the same time the growth in Indian economy has affected the software services sector and the export sector adversly. many of the small exporters have lost lacs of rupees due to growing indian economy. Since small exporters do not use hedging techniques for minimizing the adversity of the growth in indian economy their business is suffering a lot hence government need to intervene now in order to check the present rate of the U.S. Dollar. thus helping indian exporters. Indian software industry which comprises of Tata Consultancy Services, Infosys, Wipro Technology, Satyam Computer Services, HCL etc need to negotiate their contract rates again with the out sourcing firms so that they can maintain the same growth which was prevelant when dollar was in mid 40's when converted to indian rupee. Due to growing indian economy the share prices of the top five services companies are on a steady decline fromthe last 1 year where as the share prices of similar USA copanies like IBM, Perot Systems have grown in the same period.

If the Indian Economy continues to grow at the same rate of about 9% per year than the day is not far when the booming indian I.T. Industry will have to be relocated outside India on a weaker economy country so that the cost benefit can be a plus for indian services industry.

Reserve Bank of India has taken various steps for controlling the growth in indian economy but these steps help temporarily and not are permanent solution .