Escolar Documentos
Profissional Documentos
Cultura Documentos
Sept - 2007
Deepti Ramanujam Mohit Agarwal Navneet Dubey Rahul Ghelli Rajesh Joshi Sagar Mewada Tejas Deshmukh
Agenda
Introduction Growth Indicators Significant Industries Monetary Policy & Fiscal Policy Foreign Exchange Policy & BoP India v/s China Future projections
Introduction
2nd fastest growing major economy Diverse economy agriculture, handicrafts, textile, manufacturing, and a multitude of services Population-1.17bn & Labor Force-509.3 mn Exports ~ $125 bn Imports ~ $188 bn M&A
1038
1051
1068
1085
1101
1118
GDP
Per capita GDP Unemployme nt rate Interest rates (12 months)
5.8
3.8
8.5
7.5
7.10
5.75
5.00
5.50
6.00
8.25
Composition of GDP
40.0 35.0 30.0 25.0 20.0 15.0 10.0 5.0 0.0 -5.0 -10.0 2001 2002 2003 2004 2005 2006 Services Industry Agriculture GDP
Price Indices
14.0 12.0 10.0 8.0 6.0 4.0 2.0 0.0 2001 2002 2003 2004 2005 GDP DEFLATOR FPI CPI
FPI
GDP Deflator
2.2
3.1
2.5
3.9
3.5
3.8
2.8
4.4
3.3
4.4
Policies (contd)
Liquidity through LAF & MSS Cash reserve Ratio 6.5% TO 7.0% Flexible reverse Repo Rate Lifted a cap of Rs. 30bn on daily Repo transactions Rupee has risen considerable to 10% against dollar
Policies (contd)
Huge government deficits : 8-9% of GDP (central & state fiscal deficits) After 1991- economic policy shifted towards long-term domestic debt Constrained public infrastructure crowded out private sector Undermines reforms- concerns on funding debt Tax Revenue to GDP ratio 10% GDP
Balance of Payments
Fiscal 2004-05 marked a turn around Appreciating rupee, imports rising and exports slowing Widening CAD due to trade deficit Increase in FDI/FII liabilities
Items
2004-05
2003-04
2002-03
2001-02
2000-01
Trade Balance
32,175
26159 -26,159
20,542
31,421 -31,421
10,840
16,985 -16,985
10,840
16,985 -16,985
8,840
5,868 -5,842
G-Effect
Present day world
Appraisal of public policies
Financial Integration
S#
India
China
1
2 3
4 5 6 7 8 9
Cargo transit times to US is 8-12 Cargo transit times to US is 2-3 weeks weeks Contribution to world growth 0.4% Proportion of population in the productive cohort is 60% Overseas Indians account for only 9% of countrys FDI Contribution to world growth 1.2% 66% Above 50% 6 times of India Average investment rate 22% 36%
References
BRIC Report CRISIL report www.rbi.org.in www.forbes.com www.frsb.org
Thank You