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
India Economics Update Policies to promote FDI are paying dividends Measures taken by the government to encourage foreign direct investment into India are showing signs of success. Net FDI inflows rose last quarter to their highest level as a share of GDP since Q4... 17th September 2015 · 1 min read
India Economics Update Run-up to Bihar election a bellwether for reform appetite India’s increasingly decentralised system means that state elections such as the upcoming vote in Bihar have a bearing on economic policy. Perhaps more significant, the need to campaign at the local... 16th September 2015 · 1 min read
India Economics Update External vulnerabilities are still low The rise in India’s current account deficit in Q2 was due in large part to seasonal patterns. The important point from a wider perspective is that the deficit remains small. This, combined with the... 14th September 2015 · 1 min read
India Economics Update GST deadline unlikely to be met The long-awaited implementation of the Goods and Services Tax (GST) in India could bring significant benefits to the economy. But a decade after it was first proposed, there are still a number of... 9th September 2015 · 1 min read
India Economics Update Favourable base effects will soon fade Inflation is likely to have edged down in August, due in large part to favourable base effects caused by the spike in food prices a year ago. But these effects are soon likely to fade, which will push... 8th September 2015 · 1 min read
India Economics Update Fiscal position not a major concern for now The rapid expansion of the government deficit in the early part of this fiscal year has led to some concerns about the Finance Ministry’s ability to meet its budgeted target. These concerns are... 4th September 2015 · 1 min read