Smt.K.G.

Mittal Institute of Management, I T & Research

BHAGAWAT SHINDE

Date of Birth: - 11th March, 1991 Address: - B/ 48, Kaldarshan Housing Society, Ekta Nagar, Kandivali, 400064 Mobile No: - 9637390481 / 9172204780 Marital Status: - Single Email Id: - bhagawatdada@yahoo.co.in / bhagawat9@gmail.com

Masters in Management Studies (MMS)

Specialization: - Finance Career Objective To obtain a position which will offer a variety of challenges and responsibilities where my abilities and skills can be fully utilized. ACADEMIC QUALIFICATIONS:Credentials BCA Institution COCSIT,LATUR Year of Completion 2011 Percentage 71.00%

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PARIMAL COLLEGE,LATUR K.B.P.V.SAWARI

2008 2006

79.00% 75.35%

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The Indian economy has been catching up quickly in the past two decades, and weathered the global recession well. OECD Wide-ranging reforms and increased investment have home lifted potential growth to almost 9%, the highest in Indian page history, helped by improvements in infrastructure. The Departm government should step up efforts to restructure public ent List expenditure; reduce the fiscal deficit; relax some of the constraints facing the financial sector and further promote Related Topics international integration. Competit Sustaining higher growth. Administrative burdens have held back the expansion of private firms and these ion impediments need to be eased. Public-sector governance Economy should be made more transparent and accountable by separating operational and regulatory functions in the

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provision of public services and by strengthening the anticorruption agency. Further reductions in trade and FDI barriers are also needed. Improving fiscal policy and outcomes. The government resumed fiscal consolidation in 2010 and more is planned for 2011. The government needs to ensure subsidies stemming from higher world oil prices do not throw these plans off course. A binding medium-term framework is also needed, presenting the budget on a rolling three-year basis and with rules to limit deficit spending. An independent fiscal monitoring agency might strengthen fiscal discipline. The proposed goods and services tax is an important reform, and its coverage should be as broad as possible to minimise distortions. Making growth more inclusive. Poverty rates continue to fall but remain high despite strong growth: making growth more inclusive is therefore a top government priority. The introduction of the national rural employment guarantee has helped. However, only seven governments in the world spend less on health than India (in per cent of GDP). Government spending is higher in other areas aimed at lowering poverty, such as subsidisation of kerosene, liquefied petroleum gas and fertilisers. However, a large part of such outlays do not reach the poor. More widespread use of cash transfers conditional on participation in health and education programmes could boost outcomes in these areas. GDP growth in India, other large emerging economies and the OECD In per cent

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Source: OECD Download underlying data from: Continuing with financial sector reform. Indias financial sector proved resilient in the face of the global crisis. The government is committed to further financial reforms to deepen the financial system and improve access. The entry of new privately-owned banks has heightened competition in the sector and yielded efficiency gains. Granting more banking licences would help in this regard. Reforms are called for to ease wideranging and highly prescriptive operating constraints faced by the financial sector for lending, portfolio management and branch location. Improving education access and quality. Enrolment and literacy are improving and the 2009 Right to Education Act should help to speed up progress towards universal elementary education. However, high drop-out rates, low student attendance and teacher absence remain severe problems, holding back educational achievements. Teacher effectiveness in the public sector ought to be enhanced through better accountability, incentives and development pathways. In higher education regulation is often ineffective, restricting choice and hampering entry and innovation. Institutions ought to be granted greater autonomy, quality assessment should be strengthened and a higher proportion of funding tied to outcomes. How to obtain this publication

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For further information please contact the India Desk at the OECD Economics Department at eco.survey@oecd.org. The OECD Secretariat's report was prepared by Richard Herd and Samuel Hill under the supervision of Vincent Koen. Paul Conway, Ila Patnaik and Ajay Shah provided consultancy support. Research assistance was provided by Thomas Chalaux and secretarial assistance by Nadine Dufour and Pascal Halim. www.oecd.org/eco/surveys/india
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World Economic Outlook, September 2011 Source: International Monetary Fund

World Development Indicators & Global Development Finance - December 2010 Source: The World Bank

Economic Outlook No 90, December 2011 Source: Organisation for Economic Co-operation and Development

Annual Macro-Economic Database 2011, November 2011 Source: European Commission

National Accounts Main Aggregates Database, December 2011 Source: UN Statistics Division

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Accuracy of Economic Forecasts, October 2011 Source: Knoema

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GDP Statistics by Country 1990-2011 GDP by Country Ranking Unemployment rate by Country 1990-2011 CPI Statistics by country 1990-2011 CPI Statistics from different sources: IMF, World Bank, OECD CPI Inflation: Country Ranking Global Growth Global Inflation Output gap as a percent of potentia GDP Main Economic Indicators GDP, Expenditure Side GDP, Value Added by Economic Activity Commodity prices United States: Gaining Traction Europe: A Gradual and Uneven Recovery Continues CIS Countries: A Moderate Recovery is under Way Latin America and the Caribbean Asia: Still in the Lead Sub-Saharan Africa: Back to Precrisis Growth MIddle East and North Africa: The Recovery Continues

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ECONOMIC SURVEY 2010-2011

The Economic Survey to review the economic performance in the current financial year and forecast the economy prospects for the coming year. Indian economy to grow by 9 per cent in next fiscal year.

Gross fiscal deficit decreases to 4.8% of GDP. Inflation estimated to be higher by 1.5%. India on way to become fastest growing economy in the world. Calls for new 'Green Revolution' for agricultural sector with higher investment and introduction of latest technologies. Government working on regulations to emphasize on capital market. Increase influx of foreign capital by building close association with G-20 countries. National Forest Land Bank to improvise the infrastructure projects. Estimated economic growth at 8.75-9.25 per cent for fiscal year 2012. Estimated agriculture sector growth at 5.4 per cent during this fiscal year. Growth of Industrial output by 8.6% where, manufacturing sector registers 9.1%. The export stats; 29.5% in 2010 April-December and Import; 19%. Trade gap minimizes to $82.01 billion. Raised both saving and investment rate to 33.7% & 36.5% of GDP. Estimated food grains production at 232.10 million tonnes. Fores reserves to reach $297.30 billion. Importance given to telecommunication sector. Policies supporting accounting, legal, tourism, education, financial and other services. Taxation of goods and services to be revised. Introduction of Financial Schemes to monitor unemployment. Reformation necessary in the current education system by inviting more private participation.

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Home > VMW Research > Indian Economy 2011: Economic Expansion Would Be Fragile But It Is Expected That Growth Would Be Inclusive & Sustainable.

Indian Economy 2011: Economic Expansion Would Be Fragile But It Is Expected That Growth Would Be Inclusive & Sustainable.
Friday, 22 October, 2010 VMW Blog! Leave a comment Go to comments

Global economies are broadening from the economic downturn since year 2009 and still continues, although the growth is categorically fragile and needs to be proctor by the government until the shift in Business Cycle. Withal, VMW sees a lame foreign policy towards Pakistan would be a troublesome for India in the long run. Download this VMW Research in PDF Format | Permalink: bit.ly/kLvvOD

Important: VMW Research Team is considering to superannuate this research due to nonrelevance of the facts in the current economic context. Please peruse our latest research on the global economy.

Key Stats for India Overspending Inflation Trade Deficit Industrial Production Equity Returns (YTD) : : : : : 2.91% 8.90% $23.1 billion 13.76% 16.85%

Read the latest VMW-Sift Research on Indias Economic Outlook.

Major Forewarn

To ensure basic education to all. Education is still a major challenge and India should expand their budget towards the education and to make sure to provide at least basic education (high school) to all. VMW believes, expansion of education budget is extremely important for India to sustain at a level of higher economic growth and to supply quality human resource for the next generation. Heavy investments in Social Infrastructure. Since Indian government has already committed to invest up to $1 trillion in infrastructure, however the pace of development is very slow in proportion to the economic growth. Asias third largest economy is attracting billions of dollars in terms of portfolio investments and foreign direct investments and transforming itself as a best investment and market destination for the investors but to keep up the momentum, infrastructure development needs to step up moderately. Invest in Entrepreneurism: Make India as a source of new innovation to lead the next generation. Indian government should start focus on the entrepreneurism to give people a platform to exhibit their bright ideas which enables to transform their ideas into the potential corporation.

Good times are, seemingly, ahead with the sustainable growth amid persisting higher inflation, appreciation of currency against the US Dollar, trade gap and ameliorating tax policy. On the above key stats, overspending or fiscal deficit for the fiscal year 2010-11 at 2.91 per cent of the total GDP till Jun, 2010 and VMW estimated total fiscal deficit at 3.9 per cent. It is indeed lower than the budgeted estimates - largely supported by the auction of 3rd generation mobile technology spectrum, which yields the Indian Government about $22 billion. Apparently, fiscal deficit (was a preliminary problem) is not a cause of concern since the government is sitting on an ample amount of cash and could expand their spending on a much-needed social infrastructure such as Unique Identification or UID system for the Indian citizens to get them eligible for the several government schemes (prevailingly benefited for the lower-income group people). Most importantly, however, on the other side, Indias geo-political relations would be nagger, which the VMW is seriously cogitating and seeing it as one of the major challenge for India going forward. Pakistan, indubitably, is the major challenge for India to handle the fragile relations with the western border sharing country. Since 2008 Mumbai Attacks, relations between both countries has strained and needs an urgent resolution to abate the rising threat of unamicable situation between the nuclear holders and it could disrupt the trade as well as diplomatic relations. India as a state is a competitive economy and a representative political system. The recent most sensitive judgment on Ayodhyas Disputed Land lawsuit filed by the several parties for the title of land ownership has proved Indias efficiency towards the system of justice, socioeconomic, sustainable security, stability in politics via quality leadership and signaling further strong civilization in the country, which is extremely important for an economy which is attracting investments round the world.

Debate Over Quantitative Easing 2 (QE2) Economic challenges for the United States might be prodigious, however the recent policies should not be a solution for the US to re-emerge from the painful unemployment situation in the country. The overstated tone of the US President in the past few months have sparked a thought of Protectionism. US, which is always known for its dynamic economy, biggest corporations and avant-garde entrepreneurs is now becomes a propagandist towards the protectionism. Indeed, the United States is a pillar of the global economy but there is an urgent need of consistent government policies to promote trade, tax holiday to the smaller companies to improve employment opportunity and pacified business financing for smoother function of business. For

that purpose, central banks involvement in every government policy is desperately needed. In India, central bank, Reserve Bank of India have revised interest rates to curb rising inflation but the inflation is not a concern for the industrialized economies and there is an urgent need of expansion of money supply since there is no room for further rate cut as the central banks running on the Zero Interest Rate Policy (ZIRP). The recent controversial move by the US Central Bank, Federal Reserve to expand the countrys money supply by purchasing treasury bonds worth $600 billion have sparked the debate and facing dissent from the emerging nations like China, Brazil and the advanced nations like France and Germany, however the Feds move is absolutely best in the US interest and it should be keep in mind that the stability in the US economy is absolutely necessary for the global economic growth. Although, it might be a problem for the emerging nations since theyre worrying about their economy being flooded with the fresh hot money, however this could be a solution for a continous stable recovery. Japan, the worlds third largest economy, which is fighting against the sharp rise in Yen (ISO 4217 Code: JPY) and Deflation, its central bank, Bank of Japan too has cut rates to around zero. Bank of Japan also committed to buy $60 billion worth of Japanese securities, which is clearly giving the signal of infusion of fresh money into the system, which is a bolster for the Japans ailing economy.

Data Source: VMW Analytic Services ( 2011. VMW. See copyright notice)

India Economy 2011 Prospect With Global Economy In Contrast!

India has never faced as worst situation as the western economies have faced. It was just an experience of slower export, bad liquidity condition which hampered the developing economy to keep on the spectacular growth. Now, Indian economy is prospering with its own sturdy domestic demand amid high level of poverty. Corruption is still a matter of concern and

mismanagement at the organization is also a crucial part which is impacting the sustained economic growth. Indias accounts reporting system is letting tens of thousands of companies evading tax. According to the VMW Research, Indias tax department is losing almost $11 billion in terms of tax revenue every year and unorganized sector is the major contributor to the tax evasion. Despite of recent developments in the last 15 years, when the Indian taxation system has undergone tremendous reforms, but lack of transparency in the tax policy is still leading to the higher loss of tax revenue, which should be meliorate with the moderate tax policies. The recent debate over the implementation of Direct Tax Code or DTC from FY2012-13 would improve the tax laws and simplifies it further. India still has a long way to bring taxation reforms in order to prop-up tax revenue to cut the fiscal deficit because, year 2010 cannot be repeated again and again, where the government was able to raise hunky amount of cash through the sale of 3rd generation mobile technology to the mobile operators and most importantly, India was able to cut its overspending (fiscal deficit). Liquidity Update: Stock of Money, Inflation and Overnight Lending Rates. India needs long term foreign investment inflows. Inflation in India is one of the principal subject for the policy makers. Even inflation at eight per cent RBI is at sixes and sevens to fix the price crisis amid disquietude for the stable and target of double-digit growth rate for the economy. While the food price inflation is over 16 per cent and the wholesale price inflation is over eight per cent, it makes a fuss since both benchmarks are passe and needs to be reconstructed or revamped with newer commodities. Government officials says, food prices will come down in the next few months, but is there any hope for the same? Food prices are rising, thanks to the watchword of fastest growing economy, since the domestic demand is rising without pause (and would continue to rise) and at the same time, supply would not be able to conform to the rising demand. The rise in food prices are realistic and could not seem to be pacify in the next few months, however the good monsoon this year might be a solution for the rising food prices, though the RBIs monetary policy has different facet. RBI is fixing the inflation problem by tightening the money supply and demand side problem (food price inflation index) cannot be fixed straightaway. Consequently, going forward, inflation would continue to be problematic for the central bank as it is not expected that the inflation would come down to below five per cent in the next couple of months due to volatility in commodity prices and strong local demand. RBIs policy stance would be inflation hawk but it is not certainly pointing towards the consistent rise in interest rates. There are other several measures, which are available with the central bank and it is expected that the RBI would target the foreign inflows to certain extent to contain the swift appreciation in Indian Rupee (ISO 4217 Code: INR) or sell enormous amount of Indian currency to impede further wild appreciation against the US Dollar (ISO 4217 Code: USD). On the monetary situation, RBI, since Oct-2009, revising interest rates to ensure that the excess liquidity in the market would not be use in a risky assets since the economic recovery is too fragile. RBI has revised its policy rates by more than 300 bps and room for further tightening is still available with the RBI. It is now clearly visible that the commercial banks have started borrowing from the RBIs repo window and many of them have revised their lending rates and deposit rates to keep up their capital adequacy ratio and sufficient liquidity for a proper credit growth for the sustainable economic growth.

Data Source & Projection: VMW Analytic Services (2011. VMW. See Copyright Notice)

Indian Economy so far has vastly exceeded expectations. Perhaps, the shining growth would continue. apparently, VMW has revised the GDP growth estimates at 10 per cent for the fiscal year 2012 and maintaining this growth rate. India could see the double-digit growth rate (refer to the above figure of GDP over the past 60 years) backed by the immense foreign inflows, unabating rising domestic demand, boosting agricultural output, governments bolster for the infrastructure development will spur the economic growth and employment opportunities further for the next five years and it is certain that India would grow at double-digit growth rate. For this fiscal year 2010-11, according to the government authorities, Indian economy is expected to grow at 8.5 per cent and 9 per cent for the next fiscal. On the other side, Current Account of the Balance of Payment (BoP) is expected to be at -2.7 per cent of the total GDP for this fiscal and to expand further by 0.2 per cent to -2.9 per cent for fiscal 2011-12. Indias merchandise trade deficit would hard hit due to local currency appreciation, anticipation of higher crude imports and non-crude oil imports and VMW expects, Rupee will appreciate to INR42 for a US Dollar. In this situation, RBI would intervene into the foreign exchange market (since INR is a managed float type of currency) to curb appreciation and maintain uniformity. Since the Agriculture & Allied sector is one of the most significant part of the Indian Economy, dependency on monsoon is also higher. This year had a better than anticipated rainfall in the prominent parts of the country and kharif crop will see a strong output this year along with the signification availability of resources for the rabi crops, which will improve the farm sector growth by at least 4 per cent and it will improve the overall economic outlook for the next fiscal

too. On the countrys industrial growth, service export, which accounts for 5.8 per cent of the Indias GDP, will continue to be sluggish since the major export customers of the Indian IT Services are the United States and Western Europe, which are still fighting for the sustainable foundation of economy. Mining sector on the other side has a robust growth in the past few quarters and still progressing with higher growth prospect due to oil & gas activity, while growth registered by the manufacturing sector largely driven by the domestic demand.

Capital Inflows, Financial Market & Overall Economic Outlook

2010

2011

2012

Real GDP Growth Consumer Prices Current Account

9.70% 8.60% -3.1%

8.40% 5.70% -3.1%

10% 5.50% -2.3%

So far, year 2010 has attracted over $21 billion in terms of Portfolio Investments in the Indian equity markets and over $15 billion have been raised through the initial public offerings. Since the foreign investors pouring billions of dollars in emerging markets to earn good amount returns over their investments. Right now, equity is one of the most favorable investment option, since it is giving the handsome returns in a short span of time. As the US central bank, Federal Reserve is planning to buy $500 billion worth of bonds, this would further expand the kitty of the investors, which will come into the capital market. Furthermore, the corporate earnings, more or less, are better than expectations and supporting the anticipated rally in the equity markets. India will see the further inbound foreign direct investments would able to attract over $90 billion of capital inflows, which will be use to finance to abate the current account deficit to certain extent, thus India has no, but at least slight, problem as far as the macro economy is concerned. The major tussle is inflationary pressure on the Indian economy, which is a rowdy challenge and currently reading at two times of the comfort levels (set by RBI). VMW expects, that the inflation would continue to put RBI on its toe and further tightening of liquidity is expected over the next couple of quarters. More importantly, going forward, RBI would consider to curb foreign inflows into the country to prevent heating-up of the economy, since India is the best investment option from the global investments perspective. Per the observation, global economy would continue to recover, though it would be flimsy, however the world economies are set to see a major change in business cycle from the year 2012 and global economies would expand at a rapid pace with strong fundamentals framed by the government authorities and revamped strong financial system.

 2011. VMW Blog!, A division of UNIDOW FIS, unless otherwise noted. This Research is under review, therefore changes would be made without any prior notice. This VMW Research has an Open License for the classroom distribution purpose or any other noncommercial use and shall not be use for any unauthorized or commercial purpose. Please visit VMW Blog! Terms of Use (TOU). Using/copying graph, published by VMW Analytic Services, is strictly prohibited. Ask for permission to do so. For any suggestions or feedback and licensing issue, please contact VMW Blog! at vmwblog@unidow.com.
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1. Lauran Salters

Tuesday, 25 October, 2011 at 17:49 | #1 Reply | Quote

I love your Blog, its nice when you can tell somebody actuallly puts effort into a blog, and gives the blogs value.
2. savino Tuesday, 25 October, 2011 at 07:31 | #2 Reply | Quote

Hi Fantastic post here. I have been hunting more info about this. Pleased I ran across this. I will bookmark it right now.

3. Hindustani Friday, 21 October, 2011 at 16:56 | #3 Reply | Quote

What we are seeing today in India is only an organic growth. Also the growth we have seen is not going to be there in year 2011 and 2012. India even today has poor infrastructure. Though there has been large scale funds being allocated for development we have to check if this is really reaching the masses. Quality of education need to be improved in Govt Schools, Roads connecting the highways in the state levels need to done up properly. Government hospitals have to have good facility and clean envornment. Public distribution system should be fool proof, Govt has to provide electronic ration card to people who are enjoying free or discount food scheme, so that it can be confirmed that it is reaching the right person and not sold in grey market. Similarly land refoms have to be done, today real estate mafia has taken over the land and a normal man including a middle class a home has become unafordable. Govt should give better income tax releif to salaried class including subsidsed housing loan. Economic development should reach every sector and every individual and not limited. India has a long way to go. What we read in Media is just a hype and Iam sure things are not as good as we read or predict. Jai Hind

KHR Saturday, 12 November, 2011 at 23:09 | #4 Reply | Quote

I just read your comment on the above topic. I feel you are very clear about Indian economy and feel it has not developed up to the mark and it can still be developed.

4. Ramesh Kumar Nanjundaiya Thursday, 20 October, 2011 at 19:16 | #5 Reply | Quote

YET ANOTHER VIEW as recently appeared in the Economist London One-track bind Oct 8th 2011 4:45 GMT What is the current state of the Indian Economy The Indian Paradox 2011 QUOTE Indias economic growth rate in the past decade has been nothing short of spectacular. With its GDP growth around 7 to 9 percent per year, India is the second-fastest-growing large economy in the world. However, the countrys manufacturing sector accounts for a dismal 17 percent of its employment opportunities, as compared to 60 percent in agriculture and 23 percent in services.[1]This summer, the World Banks Indian Visiting Scholars Program* invited two leading academics from Harvard University to visit India and to articulate potential pathways to sustain the countrys growth trajectory. These 2 scholars are Ricardo Hausmann, Professor of Economic Development at the John F. Kennedy School of Government and Director of Harvards Center of International Development and Dani Rodrik, Professor of International Political Economy at the Kennedy School. While there, they interacted with the private sector and key policymakers, including senior officials of the Department of Industrial Policy and Promotion, the Planning Commission, and the Ministry of Finance. Hausmann argues that diversification in the economic structure, and not necessarily specialization, may be a crucial factor for accelerating growth in India. UNQUOTE My response What is the current state of the Indian Economy and where is it headed While I fully understand and appreciate Hausmanns views that diversification in the economic structure, and not necessarily specialization, may be a crucial factor for accelerating growth in India, his observation that rich economies produce many products whereas developing economies produce few products that are also made in rich economies calls

for a discussion. It is true, that this relationship exists not only between countries, but also between cities within a country. What is therefore the secret of Indias economic growth rate in the past decade which has been nothing short of spectacular? With its GDP growth around 7 to 9 percent per year, India is the second-fastest-growing large economy in the world. Who is the driver for this. Before we answer this, one needs to revisit the American Economic Historian W.W. Rostow who in the sixties had suggested that countries passed through 5 stages of economic development as Traditional Society, Transitional Stage, Take-off, Drive to Maturity and High Mass Consumption., Would this today apply to India. Many development economists argue that Rostowss model was developed with Western cultures in mind and not applicable to developing countries as India as it is generalised and policy makers are unable to identify the various stages as they seem to overlap each other. It depends how you look at it. It is a growth model and we should examine if there is actual all round development to witness the 9% GDP growth. One of the contributors for this is the growing Indian Middle Class. While the reasons are varied, but one which has really propelled up the Indian economy ( I would say, in the last 6 years) is the growing buying power of people in the so called Middle Income Group which in the case of India, per my estimation, represents almost 300 million people. This is a huge market to cater to and is growing. This group is the one which is pushing demand locally and thus giving a boast to the economy. It is a life cycle change in the population group. This is the group which is spending on all goods and related services. Because of such a growth demand for goods/services, banks will certainly witness increase in their lending in the next couple of years. This fuels continuous economic growth (notwithstanding inflation) The rosy side is that when the economy grows, the equity markets become much more active and again adds for the economy growth with more people coming into the Middle Income Group of People or the people with buying power or cash to spend. Thus going back to W.W. Rostow, we are somewhere in between stage 3 and 4. But at this stage, one needs to be very careful. While India seems to be embarking on a high-growth strategy today, it must guard and overcome some global trends which include global warming, the falling relative price of manufactured goods and rising relative price of commodities, including energy; swelling discontent with globalization in advanced and some developing economies, the various ongoing scams which could eat upto 2% of the GDP, the growing young population which should not become a struggle (almost 400 million in the age group of 15 to 30 years) to cope with and the ongoing mismatch between global problemsin economics, health, climate change, and other areasand weakly coordinated international responses. Notwithstanding the challenges, the support of the global economy remains central for the current Indian growth story or as they call it the The India Paradox: Promoting Competitive Industries in a High-Growth Country. RAMESH KUMAR NANJUNDAIYA
5. vijay vikram Sunday, 9 October, 2011 at 09:32 | #6

Reply | Quote

vmw,endeavour to highlight current situations of, indias as wellas world economy chaoses, about inflation,fiscal deficit and world global economy,is really,appreciating fragile situation need, preudent hobnobby, via global developing and developed nation to amicate these aggravate crisis..

6. Vivek Verma Saturday, 8 October, 2011 at 03:12 | #7 Reply | Quote

This projection is just an over anticipation . INDIA cannot shield itself from current headwinds going strong in global economy. Greek debt crises has reached to a level where default seems unavoidable. Euro zone is reeling heavily under Greek debt crises and this is getting contagious, soverign Debt crises is looming largely over Spain, Ireland, Portugal and Italy. US economy is succumbing to fiscal profligacy, political inertia, a lack of leadership, & economic incompetence, troubling world economy including India. Chinese economy has shown signs of slowdown and inflationary pressures are too high in India. Germany has saved Greece temporarily, but they dont have enough back to save Italy and by 2014 world will be under greatest ever economic depression becuase Italy is going to be the next biggest casuality of euro debt crises. Considering global economic scenario Indian economy will grow at 6-7% in next five years. Growth will not be inclusive but rather oligarchic limited only to upper middle class. Unless and until India will not address its systemic problems in governance like corruption and tax evasion growth will be below anticipated mark. Domestic consumption will get suffocated due to high capital cost with more tightening of monetary policies and high interest rates by RBI. India should increase tax on riches because emerging country cant afford high budget deficits with high inflation. Time ahead us full of uncertainty as situation at ground level is not good, India is taking 2 steps forward and one and half step backward. Global financial institutions and biggest global economise like Italy, Spain and Greece which so far are considered as too big to fail are almost on the brink of collapse. India is not immune to global economic headwinds which are getting stronger and stronger with each passing day. By 2014 another global depression is certain and 6-7 percent growth for India should and must hold optimism but India will not be able to drag all of its people from poverty no less than 2040.

7. rahul

Thursday, 11 August, 2011 at 17:21 | #8 Reply | Quote

May be yes, Indian economy is on the right path. Government really need to take concrete steps towards the reforms in our country so that our economy can grow at the projected pace. Indian economy is not so feeble, that it will stumble based on the crisis of some other economy. It has withstood the test of time in the toughest recessions and hence is strong enough not to slide down..discuss more on this click here http://sawaal.ibibo.com/politics/you-think-indian-economy-on-right-path-1691389.html Youll be redirected to third party website/blog on which VMW have no control. Please read our privacy policy and terms of use at UNIDOW FIS Privacy Policy before clicking on the external link.
8. vijaiyesh babu Wednesday, 10 August, 2011 at 19:57 | #9 Reply | Quote

your projections are good. but all your blabbering about fiscal policy, GDP, Liquidity all will be a false damn sure second recession waves gonna hit India soon. If my prophecy is true , recession is already started!
9. Shyam Sunday, 31 July, 2011 at 18:49 | #10 Reply | Quote

true not sure who said this, but it still rings true: I used to look down on the world for being corrupt, but now I adore it for the utter magnificence of that corruption.

10. samiran das Friday, 3 June, 2011 at 01:43 | #11

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The indian economical growth can be raised more if we can bring some changes in the system . i have an little idea about that change of system .
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Indias Monetary Policy Update: The Impact of Monetary Tightening. Banks Are Under Significant Liquidity Pressure. RBI Revised Repo Rate And Reverse Repo Rate To Contain Inflation. Inflation Is A Big Disquiet For The Central Bank. RSS feed Twitter

Welcome to official Research Blog of VMW, The UNIDOW FIS Service. VMW Blog. is an official research platform of the UNIDOW FIS to share our insights and empirical findings on the global economy. Visit our official website - www.unidow.com Important Update at UNIDOW FIS UNIDOW FIS has updated its Privacy Policy with inclusion of strict policies to address the copyright infringement. We strongly recommend you to go through our Privacy Policy & Terms of Use specially Section 1.5. Visit UNIDOW.com for more information. Follow our World on Twitter! Follow the "U-World" on Twitter to get latest updates from the UNIDOW FIS. Follow VMW on Facebook Financial Markets Sensex: 17622.45 84.86 NSE Nifty: 5335.15 26.50

Indias Inflation Rate For Dec 2011 Inflation rate in Dec 2011 (Based on Wholesale Price Index) jumped to 7.47 percent in comparing to 9.11 percent on a month over month basis (Nov 2011). Please Note: Inflation rate updates every second week of the month and last updated on Mon, Jan 16, 2012. VMW e-Research Subscription

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Indias Foreign Exchange Reserves India's Foreign Reserves $673 million at $293.93 billion for the week ended 27th Jan, 2012 vs. $293.26 billion week over week. Please Note: India's Foreign Reserves update every Friday evening and last updated on 4th Feb, 2012. Foreign Currency Trading Forex on demand is the comprehensive step-by-step guide to foreign currency trading. Master the world of online currency trading using our educational guides, charts, tools and news. Top5 VMW Researches

Indian Economy 2011: Economic Expansion Would Be Fragile But It Is Expected That Growth Would Be Inclusive & Sustainable. Indian Economy 2010 Overview: Development in the Global Economy Post Recession.

Indian Economy 2011 Overview: Challenges For The Global Economy Surfaced After Recent Sovereign Debt Crisis. India Economy 2011. Economic Expansion Would Be Continue Amid High Level Of Public Debt & Current Account Deficit. India's Economic Oulook 2012

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India Economy 2011. Economic Expansion Would Be Continue Amid High Level Of Public Debt & Current Account Deficit.
Tuesday, 1 February, 2011 VMW Blog! Leave a comment Go to comments

Over the past few months, inflation is projected as the most crucial thing to look out for the year 2011. Economists believe, that inflation would remain high and will be a roadblock for the economic expansion, however VMW Intelligence expects inflation will come down to 6 per cent and it was largely risen by huge public debt. What is the fountainhead of this high inflationary pressure in the Indian Economy? Lets discuss it now! Permalink: bit.ly/l60yAR - Text the permalink of this research to your Friends. Theme For 2011: Inflation

The new decade starts with the bang of inflation, and everyone believes it is going to impede the faster expansion of global economy. Predominantly, inflation is playing a bigger role for the policy makers to factor in while cogitating the policy for the sustainable economic expansion and without affecting the current economic growth rate and this trend in real is followed across the globe as the apprehension of discernible impact of inflation on the economy is high. India has a high inflation rate of around 8 per cent and core consumer prices is currently reading at more than 15 per cent, giving policy makers a food for thought for a stricter policy to contain the rise in prices, since VMW believes, high inflation could come down to 6 per cent in the next few months owing to expectations of good crop output resulted by good monsoon rains last year. For now, inflation is rising because there are some reason, which does exist. fundamentally, inflation is rising due to supply side constraint and inflation is not only making a new monthly highs alike gold prices in India, but other largest emerging economies such as China, Brazil and Russia too has high inflation rate at 5.1 per cent, 5.63 per cent and 8.1 per cent respectively and developed economies are also seeing the risk of high inflation. The reason is simple, one: food prices and two: economic recovery around the world pushing commodity prices upward. For every country, abnormal inflation is a problem (deflation too!). What does abnormal inflation means here? VMW have used this term in the context of micro economy for the middle-class population of the country. Indias annual food price inflation rate is more than 15 per cent and making it rowdy for the people to survive with high inflation rate (thats why, VMW is maintaining negative Political Outlook for the country). At the bottom of the production pyramid of an organization, the price of an article is rising significantly and directly impacting the consumers and inflating the price of the basket of goods. Moreover, consistent rise in government borrowings and expansion of money supply in the United States or so-called Quantitative Easing has also propelled the higher growth in inflation as the expansion of money supply means, more dollars or rupees in hand to spend.

What The Year 2011 Stores For India?

Peoples perception about the global economy has still not changed even after robust recovery in economy from the bottom. Peoples concern is sustainable job environment, which is still not there and would take more time to repair. Domestic consumption is on

high in the emerging economies and those economies are now leading the global economic expansion. Year 2012 could emerge as the revival of the next business cycle (i.e. expansion).

VMW has given inflation as the year 2011s theme and its evident that food prices, expansion of money supply in the United States, stimulus packages announced during the economic crisis and economic recovery sending the commodity prices higher are the tangible factors for the higher inflation figure across the emerging economies as well as the industrialized economies. If we make a focus on the Indian economy, India, so far, has maintained a good resilience in terms of economic expansion but, nevertheless, the recent boutade of scams, fresh highs of corruption level and lack of policy reforms from the UPA government for faster economic growth has made a significant impact on India as an investment destination. Here, VMW has the another concern, which is Current Account (CA) Deficit. Current account deficit is expected to expand further backed by depreciation of Indian Rupee (due to high inflation and real interest rates) will make imports dearer and Indias largest import product is crude, higher crude oil prices as projected and lower expectations of foreign capital inflows.

Source: VMW Analytic Services (2011. VMW. See Copyright Notice)

For FY2009-10, and FY2010-11 (Apr-Sep), Indias current account deficit was $38.38 billion and $27.9 billion respectively and India largely depends on the portfolio investments as well as foreign direct investments to finance the minus CA. The oxidized image of India followed by the intransigence mismanagement in the allotment of 2nd generation of wireless technology spectrum would make an impact on the foreign investors sentiment (the main source of the capital account) and it becomes hard for India to finance the CA deficit through short-term financing (which is a typical FII investments in India). Although FDI is better than the portfolio investments due to the longer time horizon and stable source of financing the negative current

account. However, that too has seen a reduction due to the tough entry barrier because of lack of economic policy reforms, which was supposed to be introduced during the last fiscal year.

India has a wide range of corruption. Accentuating the subject, private sector is always accountable for fostering the corruption in a country and India has a long way to go to ameliorate its regulatory framework to counter it. Every country has corruption, however it should not become a norm.

As per local media, year 2010 declared as the year of scam. Apparently, India is a capitalist economy and almost every country in this world has a certain level of corruption. It is not startling, that India has seen multiple scams in a wide range of issues (of course the extent of corruption matters, too) but here the question is, how the country deal with those issues and the ability of its judicial system to resolve it. Although, certain system can stand some corruption. However, India has the systematic corruption in the certain system, and it should be checked with priority. But VMW does not believes that these reasons will play a significant role in the economic growth for a longer period, since the countrys justice department is accountable to fix those issues and India is efficient enough in this regard. Public Debt & Political Outlook: Our main focus has shifted from inflation to recent political instability in India. Political developments is enough to equate the real interest rate either high or low. If we discuss the economic outlook for the year 2011, inflation, interest rates, current account deficit and depreciation of local currency could be the reason for slowing the down the economic growth. RBI is worry about the only thing, which is inflation and to control that thing, it would virtually hamper the dream level of economic growth (10 per cent). We still believes that the countrys economic progress to continue to persist but certain macro issues will cut the economic outlook to certain extent and will keep foreign investments away from the economy i.e. scorching level of public debt. Rise in government spending and widening of fiscal deficit would jeopardize the economic growth. Since, we already projected that the inflation will come down to 6 per cent in the next few months however, the public debt and loose in fiscal policy will almost lead to rise in real interest rates, and downside in real economic growth.

Source: Services (2011. VMW. See Copyright Notice)

VMW

Analytic

As per VMW Analytic, Indias public debt swollen to 76 per cent of the total GDP. Inflation is rising, real economic growth is at risk, interest rates are on the growth track leaving all worries to central bank. Government has total control to its control panel to monitor all the situation. A tight fiscal policy will increase confidence over the debt sustainability and virtually increases real economic growth, reduces pressure on the interest rates. If we go through our analysis, over the past few years, specifically since fiscal year 2007-08, borrowings of central government has seen a significant rise. Since fiscal year FY-2007 through FY-2010, public debt grew at 10.45 per cent annually (compounded annual growth rate) in comparison to 6.48 per cent from FY-2003 through FY-2006. For a sustainable economic growth, India needs to maintain it fiscal policy to curb risk premium. Moreover, the political uncertainity could jeopardize the fiscal balance of a country and it is extremely important, that government should work with the opposition parties to avoid any circumstances, which is not healthy for a capitalist economy.

Endnote: Nevertheless, west is rebounding and demand for easts exports are increasing gradually. In our previous economic research, VMW has projected the higher supply side inflation, now which can easily be seen, but it will come down soon. Indias public debt zoomed to more 76 per cent of the total GDP, which is much higher than our previous economic outlook research (55 per cent was then) and the further fiscal imbalances and rise in government cash balances will keep inflation on the higher side for the next few months but the we have projected the cut in inflation rate backed by lower food price inflation. Since, the central banks responsibility is to keep the moderate inflation rate, liquidity in the system is expected to remain narrow with high interest throughout the year. Even though, RBI has raised its policy rates by more than 100 bps in the past fiscal year, however we does not rule out the further revision. RBI is ready to revise interest rates further and even ready to hamper the economic growth to certain extent to control inflation up to its comfortable level or at least somewhere around its comfort zone levels (which is 5 per cent). Its obvious that high interest rate would

make an impact on the Indian companies finances, since much of the companies are having debt in their books of accounts, resulted higher interest cost hitting the companys bottom-line and halting the investments plans. Copyright 2011 VMW, a division of UNIDOW Financial Intelligence Services, unless otherwise noted. This research/data/information may only be used internally for classroom purposes and shall not be used for any commercial, unlawful or unauthorized purposes. Dissemination, distribution or reproduction of this data/information in any form is strictly prohibited except with prior written permission from the VMW. Using/copying graph, published by VMW Analytic Services, is strictly prohibited. Ask for permission to do so. Please contact VMW Blog! at vmwblog@unidow.com for any licensing issue.
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