India Economics Update Government’s FDI push still requires wider reform Measures announced yesterday to further ease restrictions on foreign direct investment into India should help to build on one of the main policy successes of the Modi government so far. However, wider... 11th November 2015 · 1 min read
India Economics Update BJP defeat in Bihar dampens reform prospects The heavy defeat for Prime Minister Modi and the BJP in the Bihar state assembly election suggests that political goodwill towards the winners of last year’s general election is beginning to run out... 9th November 2015 · 1 min read
India Economics Update Inflation set to accelerate again Inflation is likely to have risen in October, as the favourable base effects that helped to anchor food inflation in recent months continue to fade. With inflation expectations also edging up, there... 6th November 2015 · 1 min read
India Economics Update Is monetary policy “just right”? Comments this week from RBI Governor Raghuram Rajan and Finance Minister Arun Jaitley hint at a welcome thawing in their frosty relationship. What’s more, they support our view that the rate-cutting... 4th November 2015 · 1 min read
India Economics Update Privatisation target out of reach With more than half of the fiscal year having elapsed, the government’s aim of raising nearly INR700bn in revenues through the privatisation of various state-owned companies looks increasingly... 30th October 2015 · 1 min read
India Economics Update Less to economic relations with Africa than meets the eye The ongoing India-Africa Forum Summit in Delhi has been accompanied by a great deal of confused commentary on the nature and extent of economic relations between India and Africa. Contrary to what... 28th October 2015 · 1 min read
India Economics Update Efforts to restrict gold imports likely to have limited success India’s two new schemes aimed at reducing gold imports, due to be rolled out next month, are likely to have mixed results. The Sovereign Gold Bond Scheme’s easy accessibility and more transparent... 27th October 2015 · 1 min read
India Economics Update Revival in consumer spending remains elusive Despite the tailwinds of low inflation and reductions in interest rates over the past few months, consumer spending in India remains subdued. This is due in large part to continued problems in the... 22nd October 2015 · 1 min read
India Economics Update Equities regain their poise After struggling for most of this year, Indian equities have rallied so far in October. Looking ahead, with valuations not looking particularly stretched, we expect equities to post further gains over... 20th October 2015 · 1 min read
India Economics Update Export slump highlights risks to government target The narrowing in India’s trade deficit in September masks that fact that exports continue to contract sharply. Wide-ranging reform is needed to boost export prospects but, with progress still slow... 16th October 2015 · 1 min read
India Economics Update Bailout package for power sector would have limited impact A bailout for India’s heavily-indebted electricity providers would be a positive step, but there are reasons to doubt the effectiveness of any rescue deal. For a start, any package is likely to be... 15th October 2015 · 1 min read
India Economics Update What can the RBI do to get banks to lower interest rates? Having cut the repo rate by 125bp this year, the RBI has shifted its focus to ensuring that banks pass on these rate reductions to borrowers. In truth, high levels of bad debt mean that the banking... 13th October 2015 · 1 min read
India Economics Update Bottoming out Inflation is likely to have accelerated in September, due in large part to the unwindingof the favourable base effects that helped anchor food inflation in July and August.What’s more, inflation... 7th October 2015 · 1 min read
India Economics Update Finance Ministry begins to see the bigger picture The Finance Ministry’s combative approach to some key issues, including the retrospective taxation of foreign companies and the potential composition of the proposed monetary policy committee, has... 30th September 2015 · 1 min read
India Economics Update RBI front-loads policy loosening The Reserve Bank of India’s (RBI’s) decision to cut the repo rate by 50bp today, to 6.75%, went beyond what most had expected. But having stated that its attention will now turn to its medium-term... 29th September 2015 · 1 min read
India Economics Update Markets raise expectations of further loosening The weakness of inflation over the past couple of months, combined with the inaction of the US Fed, has prompted India’s financial markets to raise expectations of another cut in interest rates next... 21st September 2015 · 1 min read
