GDP growth rate for the quarter ended Sept’19 (Q2’FY20) has turned out to be worse than Q1’20 (June’19) as per the data released by MOSPI today. Worse, gross fixed capital formation (FCF), measure of future productive capacity, declined by sharp 3%, reversal of 7% over previous quarter. Despite the government’s push to prop up the economy, reflected in government final consumption expenditure going up by 15.6%, the economy continues to lose momentum. Here is a brief analysis of the GDP data. Continue reading GDP Growth – Sept’19 Performance Analysis
The continued crisis in the financial sector has led to a credit squeeze and a dramatic shift in the sectoral distribution. The shift is so sharp that “Industries”, which received credit of about Rs 15 lakh crore during FY09-14, could garner only Rs 3.7 lakh crore in the next five years, as per RBI data. Aggregate credit growth has come down sharply from 16% CAGR during FY09-14 to less than 9% during FY14-19 and more worryingly, has declined in the first half of FY20. Here is a look at the composition of bank loan over last ten years and their growth rate.
Continue reading Bank Loan – Sectoral Composition and Growth Trend
Appointment of an administrator by RBI to run DHFL would have come as a shock to the promoters as they lose control of the company in one swift move. Yet, that was the easier part. The real challenge would now to be put out its financials more transparently and put it through the insolvency process. … Continue reading DHFL – Tracking the Developments..
While software services continue to get maximum attention, Business services is also a sizeable segment and provide some useful insights. The segment reported exports of over $39 bn, less than software, but substantial, nevertheless. The segment comprises of engineering & technical, management & consulting, trade related services and so on. The segment had grown at … Continue reading India’s International Trade – Understanding the Constituents (Part II)
India’s exports fell by 1.1% in Oct’19, the third consecutive month of decline, as per the data released late last week. The positive news is that imports fell by sharp 16%, providing some decline in trade deficit figures. For the year so far, exports have now decline by little over 2% whereas imports are down … Continue reading India’s International Trade – Understanding the Constituents (Part I)
The Supreme Court’s decision last week setting aside the ruling of NCLAT (National Company Law Appellate Tribunal) should bring a finality to this high profile insolvency case. The insolvency process of Essar Steel has generated lot of attention and has been through lot of uncertainty. So much as to prompt the SBI chairman to pray for … Continue reading Essar Steel Insolvency – An Unending Saga..!
Indian economy is going through a turbulent phase partly due to reforms undertaken over last few years and partly due to ‘cleaning-up’ of corporate business practices. The strongest undercurrent is crack down against corporate fraud, an extension of the fight against black money. Automobile sector is another sector where the slowdown started almost all of … Continue reading State of the Economy – A Brief (Part II)
Indian economy is going through a turbulent phase partly due to reforms undertaken over last few years and partly due to ‘cleaning-up’ of corporate business practices. This has severely affecting the economic momentum with GDP growth declining to nearly five-year low. More importantly, the debate continues on whether the slow down is ‘cyclical’ or ‘structural’. So, what is happening with the economy and what are the important pain points? Here is a brief attempt to take stock of the same. Continue reading State of the Economy – A Brief (Part I)
India’s decision to stay out of Regional Comprehensive Economic Partnership (RCEP) appears to be retrograde and protectionist. However, it is actually quite sensible decision and saves the country from getting into a potentially unfair deal as the dangers from the agreement are very high. Here is a look at the treaty and other issues related … Continue reading RCEP – Is India’s Stand Justified??