With a view to strengthening healthy democratic values in the country, the Central Government took another historic step today. The Union Cabinet, in its meeting chaired by Prime Minister Shri Narendra Modi today decided to do away with beacons of all kinds atop all categories of vehicles in the country. The government is of the considered opinion that beacons on vehicles are perceived symbols of VIP Culture, and have no place in a democratic country. They have no relevance whatsoever. Beacons, however, will be allowed on vehicles concerned with emergency and relief services, ambulance, fire service etc. In the light of this decision the Ministry of Road Transport & Highways will make necessary provisions in the law.
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The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has approved the policy guidelines to allow financially sound State Government entities to borrow directly from bilateral ODA (Official development Assistance) partners for implementation of vital infrastructure projects. The Mumbai Metropolitan Region Development Authority (MMRDA), a State Government entity, has also been allowed to borrow directly from Japan International Cooperation Agency (JICA) Official Development Assistance (ODA) loan for implementation of Mumbai Trans Harbour Link (MTHL) project. The estimated project cost for Mumbai Trans-Harbour Link (MTHL) is Rs.17,854 crore, out of which JICA loan portion is expected to be Rs.15,109 crore.
The guidelines will facilitate the State Government entities to directly borrow from the external bilateral funding agencies subject to fulfilment of certain conditions and all repayments of loans and interests to the funding agencies will be directly remitted by the concerned borrower. The concerned State Government will furnish guarantee for the Loan. The Government of India will provide counter guarantee for the loan.
External assistance today plays a supportive role in financing major infrastructure projects, social sector projects and in building up institutional capacity. The role of external assistance has gained further significance in view of the large gap in funding requirements for major infrastructure projects implemented by the State Governments in order to acquire competitive strength under the globalized economic framework. Presently, external development assistance from bilateral and multilateral sources is received by the Government of India (i) for projects/programmes in the Central sector; (ii) for projects executed by Central Public Sector Undertakings; and (ii) on behalf of the State Governments for State sector projects/programmes to be implemented by the State Governments and/or local bodies and public sector undertakings. The existing guidelines do not allow direct borrowings by the State Government entities from external agencies.
Several State agencies are implementing major infrastructure projects of national importance. These projects, even if viable and sound, have huge funding requirements and borrowing by the State Governments for such projects may exhaust their respective borrowing limits. Therefore, in order to accelerate the pace of investment in major infrastructure projects in the country without compromising the need for external assistance for other sectors, an enabling provision in the existing guidelines was considered necessary to facilitate direct borrowing by the State Government entities from bilateral external agencies. This dispensation will allow the financially sound State entities to directly borrow and repay the loan required for major infrastructure projects without burdening the State exchequer. The approval of these guidelines reiterates Governments commitment to promote inclusive growth and strengthen the economy.
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The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has given its approval for procurement of Voter Verifiable Paper Audit Trail (VVPAT) Units for use in the General Elections, 2019 for
a) purchase of 16,15,000 Voter Verifiable Paper Audit Trail (VVPAT) Units at a tentative unit cost of Rs.19,650, and at a total estimated cost of Rs. 3173.47 crore (excluding taxes and freight as applicable) during the years 2017-18 and 2018-19 from M/s Bharat Electronics Ltd., Bangalore and M/s Electronics Corporation of India Ltd., Hyderabad;
b) directing the Price Negotiation Committee to negotiate with M/s Bharat Electronics Ltd and M/s Electronics Corporation of India Ltd to rationalise the final unit price expeditiously;
c) allocation of additional funds to the tune of Rs. 1600 crore in the current financial year in the supplementaries/Revised Estimates for meeting the cash outgo envisaged for purchase of EVMs (Control Units & Ballot Units) and VVPAT Units during the year 2017-18, payment of 40% of the said amount as advance to the manufacturers and for provision of balance amount as may be required in the BE 2018-19; and
d) placement of Order by the Election Commission to the two manufacturers depending upon their production capacity so that all the VVPAT Units can be procured by September, 2018.
The decision of the Government would enable the Election Commission of India to deploy VVPAT Units in all pooling booths in the General Elections, 2019, which will act as an additional layer of transparency for the satisfaction of voters, allaying any apprehension in the minds of the voters as to the fidelity and integrity of the EVMs. This would also result in compliance of the directions of the Honble Supreme Court vide its Order dated 8thOctober, 2013.
The idea of an additional layer of transparency for the satisfaction of voters in the form of a voter verifiable paper trail was suggested by the political parties in a meeting taken by the ECI on 4th October, 2010. Accordingly, introduction of the VVPAT was facilitated by amending the Conduct of Election Rules, 1961 vide Notification dated 14th August, 2013. Thereafter, 20,300 VVPAT Units were purchased by the ECI in 2013. Since then, these units are being deployed in elections in select Assembly and Parliamentary Constituencies. Subsequently, order for 67,000 additional Units was placed in 2015, out of which 33,500 Units have been supplied by the manufacturers. Requisite funds for purchase of the aforesaid number of VVPAT Units were provided by the Government as and when requested by the Election Commission.
VVPAT device functions like a printer to be attached to the ballot unit and kept inside the voting compartment. When the voter presses the button against the name of the candidate of his choice on the Ballot Unit, the VVPAT unit generates a paper slip, called Ballot Slip. This paper slip contains the name, serial number and symbol of the chosen candidate. The voter can see this slip through a screened window where it stays for seven seconds, and then it automatically gets cut and falls down into a sealed drop box. In this process, the slip will not go into the hands of the voter nor will others be able to see it.
Civil Appeal No.9093/2013 was filed by Dr. Subramanian Swamy pleading for directions to the Election Commission to use VVPAT Units in all polling booths. It was alleged in the said Petition, that the Electronic Voting Machines are not reliable and that there should be some device by which the voter should get a confirmation that the vote cast by him has been recorded in favour of the candidate of his choice. In deference to the plea of the petitioner in the aforesaid CA, the Election Commission submitted that it has no objection to the introduction of VVPAT Units for conduct of free, fair and transparent elections. The Supreme Court in its Order dated 8th October, 2013 directed that for implementation of such a system of VVPAT in phased manner Government of India may provide required financial assistance for procurement of requisite number of VVPAT Units.
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The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has given (I) Ex-post facto approval for introduction of (i) Constitution (One Hundred and Twenty-third Amendment) Bill 2017 and (ii) National Commission for Backward Classes (Repeal) Bill, 2017 in the Parliament; and (II) Approval for retention of posts/incumbents and office premises held by the existing National Commission for Backward Classes by the proposed new National Commission for Backward Classes
The approval is for the proposal to bring about a Constitutional Amendment namely the Constitution (One Hundred Twenty-third Amendment) Bill, 2017 by:
1. a. Constitution of a Commission under Article 338B for socially and educationally backward classes by name of National Commission for Backward Classes; and
b. (b) insertion of Clause (26C) under Article 366 with modified definition viz. n++socially and educationally backward classesn++ means such backward classes as are so deemed under Article 342A for the purpose, this Constitution and
2. Introduce a Bill for:
a. Repeal of the National Commission for Backward Classes Act, 1993 along with Savings Clause for namely the National Commission for Backward Classes (Repeal) Bill, 2017; and
b. Dissolution of the National Commission for Backward Classes with effect from such date as the Central Government may appoint in this behalf and the National Commission for Backward Classes constituted under sub-section (1) of Section 3 of the said Act shall stand dissolved.
3. (a) Appropriation of the sanctioned 52 posts, along with incumbents wherever filled of the existing National Commission for Backward Classes in the proposed National Commission for Backward Classes to be constituted under Article 338B; and (b) Retention of the office premises of the existing National Commission for Backward Classes at Trikut-1, Bhikaiji Cama Place, New Delhi-110066, by the National Commission for Backward Classes to be constituted under Article 338B.
The above decisions will lead to overall welfare of socially and educationally backward classes.
The proposed Act of repeal is necessary in view of setting up of the National Commission for Backward Classes by insertion of Article 338B of the Constitution.
The decision will also enable effecting continuity in the functioning of the National Commission for Backward Classes under Article 338B.
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The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has given its approval for extending the validity of the existing Central Order dated 27.10.2016 in respect of sugar for a further period of six months from 29.04.2017 to 28.10.2017.
The main objective of the decision is to enable the State Governments to issue control order with the prior concurrence of Central Government, for fixing stock limits/licensing requirements in respect of sugar, whenever need is felt by them. This is expected to help in the efforts being taken to improve the availability of these commodities to general public at reasonable rates, and control the tendencies of hoarding and profiteering.
The current decision will be notified by the Government and communicated to all the States/UTs for further action at their end.
The Cabinet in its meeting held on 27.10.2016, decided to enable the States to regulate supply, distribution, sale, production, stock, storage, purchase and movement etc, in respect of sugar for a period up to six months. Accordingly, S.O. 3341(E) dated 27.10.2016 was issued, for enabling administrative department, States & UTs to decide stock limits etc. on sugar upto 28.04.2017, by amending the Removal of Licensing Requirements, Stock limits and Movement restrictions on Specified Foodstuffs Order, 2016 dated 29.09.2016 notified as G.S.R. 929(E).
The prices of sugar are being monitored by the Department of Food & Public Distribution regularly at factory gate as well as in the domestic market. In September, 2016 it was noticed that the retail prices had shown a sudden spurt. The price rise appeared to be more on sentiment than actual shortage. In order to regulate supply of sugar and address issue of speculative prices, fixing of appropriate stock limit on need basis was essential. In addition, despite adequate availability of stocks for consumption in the current season, hoarding and consequent profiteering is anticipated due to drop in production over previous year and hence further extension of stock limit would be needed.
To support the sugar sector, the Government had recently extended soft loan assistance of Rs.4305 crore to the industry which has been directly credited to farmers account on behalf of sugar mills through banks benefitting about 32 lakh farmers. Also a performance based production subsidy has been extended @Rs.4.50 per quintal of cane crushed which was directly credited to the farmers account on behalf of sugar mills.
In order to maintain domestic prices at reasonable levels, the Government has allowed import of a restricted quantity of 5 lakh MT of raw sugar at zero duty by millers/refiners having their own refining capacity. This restricted quantity will help the sugar industry to augment their liquidity and enable them to pay cane dues of farmers.
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The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has approved leave encashment up to 180 days in respect of those Defence personnel who died or were invalidated out of service between 30.12.1991 to 29.11.1999 with less than 15 years of service.
The decision will benefit the families of 9777 Officers and other personnel of Defence Services who died or were invalidated out of service during this period. This period is very significant as a large number of casualities took place during the Kargil conflict (n++Operation Vijayn++) and in counter insurgency operation in J&K and North East during the period.
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The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has given its approval for signing of a Protocol amending the Convention between India and Portugal for avoidance of double taxation. The Protocol will also ensure prevention of fiscal evasion with respect to taxes on income.
Once the Protocol enters into force, both India and Portugal would be able to exchange tax related information, which will help tax authorities of both countries to curb tax evasion.
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Most APAC economies have started 2017 with good momentum, and regional growth is likely to remain relatively healthy by global standards during the rest of the year, says Fitch Ratings. APAC sovereign rating trends are mostly stable. However, several rising challenges are likely to weigh on growth as the year wears on. Tighter global financial conditions and another round of US dollar appreciation could create strains. Chinas economy is likely to ease, which would dampen external demand around the rest of the region. A potential increase in global protectionism might also undermine export performance, while geopolitical risks - such as those centering on North Korea - could dampen business sentiment.
Asian exports and business surveys have fared better than we had expected, reflecting surprisingly strong growth in the US and Europe as well as policy-driven stabilisation of growth in China. Expansionary fiscal policy and infrastructure spending have supported domestic demand around much of the region, and some economies are making progress on reforms, most notably India and Indonesia.
However, tighter global financial conditions could see growth decelerate over the next few quarters. We forecast two more US rate hikes in 2017, and another four in 2018. Eventually, we expect the Fed Funds rate to normalise at 3.5%-4.0% by 2020, far higher than current market expectations. Higher US rates are likely to drive renewed appreciation of the US dollar.
Higher debt-servicing costs in Asia might create pressures in countries where debt has built up rapidly during the period of very low interest rates. Some sovereigns are made vulnerable in this respect by high private foreign-currency debt, such as in Malaysia, or a dependence on foreign inflows - such as in Indonesia. Asset prices could also suffer.
A stronger dollar could have benefits for Asian exporters, but this is offset by the prospect of a slowdown in China and the risk of increased protectionism. The Chinese authorities have recently started to shift their focus toward curbing leverage and containing financial risks. Macro-prudential controls on banks shadow-funding activities have been tightened in recent months, and the Peoples Bank of China has increased key money-market interest rates. These measures are likely to slow growth in 2H17 and into 2018.
The main protectionism threat stems from the US. A recent meeting between US President Trump and Chinese President Xi appears to have lowered the risk of an imminent trade war between their countries, but a lot could still change. The Trump administration has already withdrawn from the Trans-Pacific Partnership, and has consistently used tough rhetoric on trade, with the emphasis on unfair competition from countries that run large bilateral trade surpluses with the US, including China. The US vice-president has also said this week that the trade pact with South Korea will be reformed.
Overall, we expect APAC aggregate GDP growth to remain relatively flat in 2017. Slowdowns are likely in some of the most trade-dependent economies with significant exposure to China, such as Hong Kong, Korea, and Singapore. However, we expect marked pick-ups in the next few years in the domestically driven economies of India and Indonesia, which should continue to benefit from recent reforms.
Most APAC sovereigns are on Stable Outlook, with some exceptions. Indonesia and the Philippines are on Positive Outlook, reflecting strong GDP growth and - in Indonesias case - positive reforms and growing resilience to external pressures. Japans A rating was placed on Negative Outlook last June on deteriorating public finances, although recent indicators point to a brighter growth outlook than we had previously expected.
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In the most comprehensive and extensive analysis yet of CSR performance of companies in FY16, CSR performance of companies with respect to requirements of CSR legislation have substantially improved over FY15. The results are based on disclosures of close to 1,270 companies listed on BSE that had to comply with Section 135 of Companies Act 2013. The analysis was conducted by CII-ITC Centre of Excellence for Sustainable Development in form of Annual CSR Tracker 2016, which on yearly-basis captures annual CSR disclosures.
In FY16, these 1,270 companies collectively spent Rs 8,185 cr, which is 27% more than spend of Rs 6,400 cr in FY15. The spend is 92% of the required CSR budget of Rs 8,900 cr, using two percent of average net profits of three financial years. The companies collectively had budgeted Rs 10,257 cr, which is 15% more than the minimum budget required.
A notable feature of CSR disclosures in FY16 is that some companies have begun to disclose output data. 13 percent, or 166 of 1,270 companies making such disclosures, reflects going beyond legislative requirements and improving the quality of disclosures. 1.5 cr people benefitted from Rs 3,747.97 cr spent for which output data has been reported. This averages to Rs 2,498.65 spent per person.
Chandrajit Banerjee, Director General of CII, said n++results of CIIs Annual CSR Tracker 2016, clearly demonstrate improvement in the practice and disclosure of practice of CSR by companies. The fact that companies are budgeting and spending more than the minimum legislative requirement suggests that companies want to do more for betterment of communities. There is always room for improvement and I am hopeful that results of FY17 will reflect that improvement.n++
The number of companies spending CSR budgets exclusively through corporate foundations increased to 72 from 60 in FY15. The number of companies exclusively spending money directly marginally increased to 233 from 227, whereas that spending money exclusively through implementing agencies remained stable at 249 as compared to 251 in FY15. This tends to suggest that companies are building their own capacities for implementation.
Health and sanitation, education and skill development, and rural development are the top three developmental areas for spends. The absolute amount of money contributed to PMs Relief Fund reduced by 25% to Rs 80.55 cr. Though the absolute amounts spent in incubation centres, protection of national heritage, and sports development, are small as compared to the top three areas, the percentage increases over the previous year are anywhere between 18 to 122%.
Out of the 32 industry categories, absolute spends have decreased in just two industries, viz., commercial services and supplies, and oil and gas. Big increases are reported in automobiles and auto components, consumer durables, metals and mining, financial services, pharma and biotech, telecom services and equipment, textiles, apparels and accessories, transportation, and utilities.
Naushad Forbes, President, CII said, n++this extensive and elaborate analysis of almost 1,300 companies is indicative of their commitment to directly contribute to development of hundreds of thousands of fellow citizens. Companies do good in myriad ways and companies should encourage contributions in unique and innovative areas. CSR is a matter of board-level accountability and the boards should be allowed the space to conduct their job without interference or influence from certain stakeholders that have tendencies to exploit CSR legislation for their narrow gains.
The purpose of CIIs Annual CSR Tracker has been for key stakeholders to reflect on yearly and inter-year performance of companies on CSR. In sum, FY16 has been a significant improvement on almost every aspect of CSR legislation. Some companies going beyond the legislative requirements. CESD projects that CSR spends will further increase in FY17, with a back-of-the envelope calculation of around Rs 10,000 cr. There should be improvements in quality of disclosures and more companies disclosing beneficiary data.
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With buoyant financial markets and a long-awaited cyclical recovery in manufacturing and trade under way, world growth is projected to rise from 3.1 percent in 2016 to 3.5 percent in 2017 and 3.6 percent in 2018, slightly above the October 2016 World Economic Outlook (WEO) forecast. But binding structural impediments continue to hold back a stronger recovery, and the balance of risks remains tilted to the downside, especially over the medium term. With persistent structural problemsn++such as low productivity growth and high income inequalityn++pressures for inward-looking policies are increasing in advanced economies. These threaten global economic integration and the cooperative global economic order that has served the world economy, especially emerging market and developing economies, well. Against this backdrop, economic policies have an important role to play in staving off downside risks and securing the recovery.
On the domestic front, policies should aim to support demand and repair balance sheets where necessary and feasible; boost productivity, labor supply, and investment through structural reforms and supply-friendly fiscal measures; upgrade the public infrastructure; and support those displaced by structural transformations such as technological change and globalization. At the same time, credible strategies are needed in many countries to place public debt on a sustainable path. Adjusting to lower commodity revenues and addressing financial vulnerabilities remain key challenges for many emerging market and developing economies. A renewed multilateral effort is also needed to tackle common challenges in an integrated global economy.
The world economy gained speed in the fourth quarter of 2016 and the momentum is expected to persist. Global growth is projected to increase from an estimated 3.1 percent in 2016 to 3.5 percent in 2017 and 3.6 percent in 2018.
Activity is projected to pick up markedly in emerging market and developing economies because conditions in commodity exporters experiencing macroeconomic strains are gradually expected to improve, supported by the partial recovery in commodity prices, while growth is projected to remain strong in China and many other commodity importers. In advanced economies, the pickup is primarily driven by higher projected growth in the United States, where activity was held back in 2016 by inventory adjustment and weak investment.
Although changes to the global growth forecast for 2017 and 2018 since the October 2016 WEO are small, there have been meaningful changes to forecasts for country groups and individual countries. In line with stronger-than-expected momentum in the second half of 2016, the forecast envisages a stronger rebound in advanced economies. And while growth is still expected to pick up notably for the emerging market and developing economies group, weaker than-expected activity in some large countries has led to small downward revisions to the groups growth prospects for 2017.
n++ For advanced economies, projected growth has been revised upward in the United States, reflecting the assumed fiscal policy easing and an uptick in confidence, especially after the November elections, which, if it persists, will reinforce the cyclical momentum. The outlook has also improved for Europe and Japan based on a cyclical recovery in global manufacturing and trade that started in the second half of 2016.
n++ The downward revisions to growth forecasts for emerging market and developing economies result from a weaker outlook in several large economies, especially in Latin America and the Middle East, reflecting continued adjustment to the decline in their terms of trade in recent years, oil production cuts, and idiosyncratic factors. The 2017 and 2018 growth forecasts have been marked up for China, reflecting stronger-than-expected policy support, as well as for Russia, where activity appears to have bottomed out and higher oil prices bolster the recovery.
Since the U.S. election, expectations of looser fiscal policy in the United States have contributed to a stronger dollar and higher U.S. Treasury interest rates, pushing up yields elsewhere as well. Market sentiment has generally been strong, with notable gains in equity markets in both advanced and emerging market economies. Stronger activity and expectations of more robust global demand going forward, coupled with agreed restrictions on oil supply, have helped commodity prices recover from their troughs of early 2016.
Headline inflation has been picking up in advanced economies due to higher commodity prices, but core inflation dynamics remain subdued and heterogeneous (consistent with diversity in output gaps). Core inflation has improved little where it had been the weakest (for instance, in Japan and parts of the euro area). Headline inflation has also picked up in many emerging market and developing economies due to higher commodity prices, but in a number of cases it has receded as pass-through from the sharp currency depreciations in 2015 and early 2016 continues to fade.
Risks remain skewed to the downside, however, especially over the medium term, with pervasive uncertainty surrounding policies. Buoyant market sentiment implies that there is now more tangible upside potential for the near term, but in light of the sources of uncertainties discussed below, a sharp increase in risk aversion is possible. Risks to medium-term growth appear more clearly negative, also because policy support in the United States and China will have to be unwound or reversed down the road to avoid unsustainable fiscal dynamics. More generally, downside risks stem from several potential factors:
n++ An inward shift in policies, including toward protectionism, with lower global growth caused by reduced trade and cross-border investment flows
n++ A faster-than-expected pace of interest rate hikes in the United States, which could trigger a more rapid tightening in global financial conditions and a sharp dollar appreciation, with adverse repercussions for vulnerable economies
n++ An aggressive rollback of financial regulation, which could spur excessive risk taking and increase the likelihood of future financial crises
n++ Financial tightening in emerging market economies, made more likely by mounting vulnerabilities in Chinas financial system associated with fast credit growth and continued balance sheet weaknesses in other emerging market economies
n++ Adverse feedback loops among weak demand, low inflation, weak balance sheets, and anemic productivity growth in some advanced economies operating with high levels of excess capacity
n++ Noneconomic factors, including geopolitical tensions, domestic political discord, risks from weak governance and corruption, extreme weather events, and terrorism and security concerns
These risks are interconnected and can be mutually reinforcing. For example, an inward turn in policies could be associated with increased geopolitical tensions as well as with rising global risk aversion; noneconomic shocks can weigh directly on economic activity as well as harm confidence and market sentiment; and a faster-than-anticipated tightening of global financial conditions or a shift toward protectionism in advanced economies could exacerbate capital outflow pressures in China.
Policy choices will therefore be crucial in shaping the outlook and reducing risks. Priorities for macroeconomic demand management are increasingly differentiated, given the diversity in cyclical positions. In economies with slack and persistently weak core inflation, cyclical demand support remains necessary, including to stave off pernicious hysteresis effects. In economies where output is close to or above potential, fiscal policy should aim at strengthening safety nets and increasing potential output. At the same time, credible strategies are needed in many countries to place public debt on a sustainable path.
Momentum in the global economy has been building since the middle of last year, allowing us to reaffirm our earlier forecasts of higher global growth this year and next, says International Monetary Fund (IMF). We project the world economy to grow at a pace of 3.5 percent in 2017, up from 3.1 percent last year, and 3.6 percent in 2018. Acceleration will be broad based across advanced, emerging, and low-income economies, building on gains we have seen in both manufacturing and trade.
Our new projection for 2017 in the April World Economic Outlook is marginally higher than what we expected in our last update. This improvement comes primarily from good economic news for Europe and Asia, as well as our continuing expectation for higher growth this year in the United States.
Despite these signs of strength, many other countries will continue to struggle this year with growth rates significantly below past readings. Commodity prices have firmed since early 2016, but at low levels, and many commodity exporters remain challenged - notably in the Middle East, Africa, and Latin America. At the same time, a combination of adverse weather conditions and civil unrest threaten several low-income countries with mass starvation. In Sub-Saharan Africa, income growth could fall slightly short of population growth, but not by nearly as much as last year.
Policy uncertainties and politics
Whether the current momentum will be sustained remains a question mark. There are clearly upside possibilities. Consumer and business confidence in advanced economies could rise further - though confidence indicators are already at relatively elevated levels. On the other hand, the world economy still faces headwinds. For one thing, trend productivity growth remains subdued across the world economy, for complex reasons that we have explored in a recent paper, and that seem likely to persist for some time. In addition, several prominent downside risks threaten our baseline forecast.
One set of uncertainties stems from macroeconomic policies in the two largest economies. The U.S. Federal Reserve has embarked on monetary normalization and may soon begin to scale back the size of its balance sheet. Given the faster U.S. recovery, we could see more upward pressure on the dollar, as interest-rate hikes are not yet imminent for the Bank of Japan and the European Central Bank. At the same time, however, U.S. fiscal policy still seems likely to turn more expansionary over the next couple of years. If the slack remaining in the U.S. economy is small, the result could be inflation and a faster than expected pace of interest rate rises, reinforcing dollar strength and possibly causing difficulties for emerging and some developing economiesn++especially those with dollar pegs or extensive dollar-denominated liabilities. Chinas desirable rebalancing process continues, as seen in a declining current account surplus and an increased GDP share of services, yet growth has remained reliant on domestic credit growth so rapid that it may cause financial stability problems down the road. These problems could, in turn, spill over to other countries.
Aside from the conjunctural policy uncertainties, a distinct set of threats comes from the growth in advanced economies of domestic political movements skeptical of international economic integrationn++no matter if integration is promoted through multilateral rules-based systems for the governance of trade, more ambitious regional arrangements such as the euro area and European Union, or globally agreed standards for financial regulation. A broad withdrawal from multilateralism could lead to such self-inflicted wounds as widespread protectionism or a competitive race to the bottom in financial oversight - a struggle of each against all that would leave all countries worse off.
There is no universal policy prescription for diverse economies at different conjunctural stages. Deflationary pressures have generally receded, but monetary accommodation should continue where inflation remains stubbornly below target levels. Growth-friendly fiscal measures, especially where there is fiscal space, can support demand where that is still needed and contribute to expanding supply and reducing external imbalances. All countries have opportunities for structural reforms that can raise potential output as well as resilience to shocks, although specific reform priorities differ across economies.
Avoiding the damage from protectionist measures will require a renewed multilateral commitment to support trade, paired with national initiatives that can help workers adversely affected by a range of structural economic transformations including those due to trade. Trade has been an engine of growth, promoting impressive per capita income gains and declines in poverty throughout the world, especially in poorer countries. But its benefits have not always been equally shared within countries, and political support for trade will continue to erode unless governments step up to invest in their workforces and aid the adjustment to dislocations. Another recent paper of ours, co-authored with the World Bank and the World Trade Organization, surveys possible policy approaches. Importantly, such measures not only support trade, they aid adjustment to a range of structural changesn++including those from rapid technology change. They can also raise potential output.
International cooperation key
International growth and stability rely on multilateral collaboration across a range of problems that spill over national borders--not just trade. The challenges include financial oversight, tax avoidance, climate, disease, refugee policy, and famine relief. Historically, inclusive cooperative approaches to interdependence have worked best. National policymakers, however, must do the hard work to ensure that the gains from harnessing interdependence, which are substantial, are broadly shared.
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Industries in Uttrakhand are grappling with huge shortage of skilled manpower and to meet the requirement ASSOCHAM-TARI study has recommended urgently a comprehensive training centres equipped with better infrastructure facilities for training so that in 5 years about 4 lakh workers are trained to give thrust to the industrialisation.
The Associated Chambers of Commerce and Industry of India (ASSOCHAM) and Thought Arbitrage Research Institute (TARI) have jointly brought a Sustainable Action Plan for the new government.
During 2012-22, about 2.06 million jobs will be created whereas 2.53 million additional people will be added to the labour force. The paper further suggests the comprehensive training to youths for the primary sector like irrigation management, rainwater harvesting needed, noted the study.
The report further stressed that the skilling centres should be set up, like food processing in Rishikesh, handloom in Almora and tourism in Uttarkashi. n++Management Information System (MIS) should be designed to capture the requirement of skilled personnel at various levels in various districts in line with NSDC study/ recommendationsn++.
The state needs to build up a database for current level of migration, employment, agri processing industries, urban housing, telecom etc. There is a need for fresh policies in the areas of health, education, skilling and water management.
n++Collaboration between the state government and state universities, research institutes and public and private think tanks too is necessary for economic research and reworking of policy frameworksn++.
Higher growth has encouraged private sector participation and higher investment. In 2015-16, it received fresh investment of Rs 1.45 lakh crore with a growth rate of 23.7% over the previous year. Most of the investment has come into infrastructure, construction and real estate. The share of investment in infrastructure has increased from 11.8% in 2004-05 to 27.5% in 2015-16. Construction and real estate investment share increased from negligible in 2004-05 to 3.9% in 2015-16.
The industry sector is dominated by small scale industries (SSIs). During 2011-12 to 2014-15, SSIs grew by 18.5%. The sector comprises of floriculture, horticulture, agri/food processing, biotechnology and tourism and has been showing continuous improvement. However, the full potential of these industries has not been exploited due to various bottlenecks which have been addressed below.
The growth in the services sector is driven by tourism (depicted by trade, hotels and restaurants) which has the highest share in this sector. Its growth, in fact, accelerated during 2004-5 to 2014-15 and its share increased from around 34% in 2004-05 to 51% in 2014-15. Growth rate of this sector has been around 17%.
While addressing the press conference Mr. Jajodia said, n++A comprehensive policy of public private partnership (PPP) needs to be framed along the lines of Kerala, which has brought private investment and done wonders to promote tourismn++.
According to the ASSOCHAM paper, more investment is needed in building warehouses, cold storages and specialized transport vehicles for food processing industries. More private sector participation should be encouraged to build tourist infrastructure.
Lack of modern techniques and technologies, lack of high quality seeds for crops suitable for rain-fed and hill areas, small and fragmented land holdings, high taxes on purchase of food grains and lack of sufficient marketing facilities are hampering growth. The state needs to invest more in research and development of high quality seeds, application of new and innovative technologies and provide training to farmers. Village adoption programme which provides for farmers training and technological assistance in the plains should be expanded to hilly areas, added ASSOCHAM Chief.
The concept of cooperatives, contract farming, self-help groups and farmers organisation are helpful in addressing the problems arising out of small and fragmented land holding, like access to credit and innovative technologies.
The report said the industrial sector has done well, particularly the rural and small industrial units have grown by leaps and bounds and the sector now contributes around 40% to the GSDP - one of the highest in India. However, there is a huge potential for the expansion of agri-based industries which needs to be harnessed by improving marketing facilities and skilling. The ease of doing business ranking has improved but complex documentation, lack of IT-based tracking and monitoring of administrative clearances act as disincentives and need to be addressed.
Micro-credit institutions and SHGs need to be promoted to provide credit to women to set up their own small business in hill areas. To generate more employment in the informal sector, agriculture growth should be supported with storage, warehousing and marketing facilities and more emphasis should be put on vertical integration of labour intensive industries - like apparel industries should be motivated to integrate button and cuff making units etc. to generate employment in such micro sectors.
The state should make efforts to promote other forms like adventure and eco-tourism by setting safety standards for adventure sports and implementing and expanding the scope of Uttarkhand Homestay Agenda for Uttarakhand Government 2017 Policy formulated. The state also needs to provide skilling in foreign languages as the inflow foreign tourists has been steadily going up.
The states Char Dhaam highway connectivity is a good model to follow in the rest of the hill areas. Power supply in hills is particularly worrisome as it is skewed in favour of the plains. AT&C losses are high. Efforts should be made in setting up small, mini and micro hydropower generation plants and revival of 15,000 water mills lying defunct. Besides, electricity generation through pine gasification is still in the pipeline.
Financial inclusion needs to be strengthened to overcome regional disparities and low index of financial inclusion. The state would do well to take advantage of the central government sponsored slum redevelopment and urban renewal programmes to overcome such problems. The state needs to launch a full-fledged programme of training local bodies to make city sanitation and promote MFIs and Business Correspondents (BCs) to take financial inclusion to remote areas.
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Indian nutraceuticals market is expected to cross from a value of US$ 2.8 Billion in 2015 to a value of US$ 8.5 Billion by 2022, according to the joint study brought out by ASSOCHAM and RNCOS.
In 2015, India accounted for a share of around 2% of the global market. By 2022, this share is anticipated to increase to a value of approximately 3% owing to countrys large population base, increasing urban belt and awareness, according to a study on Indian Nutraceuticals, Herbals, and Functional Foods Industry, jointly conducted by The Associated Chambers of Commerce and Industry of India (ASSOCHAM) and RNCOS.
The overall market is classified into Dietary Supplements and Functional Food & Beverages, with the former estimated to occupy the larger chunk of around 65% in 2015. Functional food & beverages are expected to grow with a higher growth rate. This is due to the increasing visibility of such products in modern retail formats and promotional activities through TV advertisements.
In 2015, the Indian dietary supplements market was valued at US$ 1.8 Billion. However, with growing awareness, number of people opting for dietary supplements on their own has also increased. Higher purchasing power has prompted Indians to be more health conscious and adopt a healthy diet routine completed with consumption of nutritional supplements, said Mr. D S Rawat, Secretary General ASSOCHAM.
The demand for the vitamin and mineral supplements may increase in the future due to the unhealthy eating habits and stress in daily lifestyle. People may benefit from the extra nutrients found in these supplements. A multivitamin and mineral supplement will help in safeguarding against periodic nutrient shortfalls in the diet. Due to these reasons the vitamin and mineral market in India is anticipated to grow in the coming years and reach a value of US$ 2.1 Billion by 2022, adds the study.
Herbal supplements are type of dietary supplements that contain herbs plant or parts of a plant. These plants or plant parts are used for their scent, flavour or potential therapeutic properties. The flowers, leaves, bark, fruit, seeds, stems, and roots of a plant are used either singly or in mixtures. However, some herbs can cause serious health issues if they are not taken without prior consultation. Therefore, it is best to take herbal supplements under the guidance of a medical professional.
In 2015, the market for herbal supplements was at an approximate value of US$ 0.6 Billion in India. Owing to their natural ingredients and popularity among people, this market is forecasted to reach a value of US$ 1.7 Billion by 2022, noted the study.
Functional foods and beverages market in India has strengthened itself, fostered by its rising penetration amongst health conscious people in the country. Functional foods include food products such as functional biscuits, breads, cereals, vegetable oil, nutrition bars, yogurt and others. Functional beverages include functional fruits juices, milk, tea, coffees, and energy drinks. Rising knowledge about wellness and health along with inclining expenditure on food has increased the number of consumers accepting functional foods & beverages. This is propelling the growth of the functional foods and beverages market to reach a value of US$ 3.2 Billion by 2022.
Additionally, protein drinks have also showcased an increasing demand from a segment of people searching for weight management solutions while maintaining a sound lifestyle. Functional teas and coffees are slowly capturing the demand in the country.
The Indian Functional Foods and Beverages market can be segmented into Functional Foods Market and Functional Beverages Market. Among the two, functional foods occupy the major share of 70%. However, convenience, availability of innovative products and health benefits associated with functional beverages are the leading factors influencing the growth of this market.
Functional foods are food products that consist of vital nutrients that go beyond simply nurturing usual growth and development of an individual. These food products are fortified with nutritional and disease preventing qualities. The consumption of such food is done with an intention towards improved wellbeing, prolonged existence and prevention of chronic diseases. The functional foods available in the market include the likes of oats, soy, flaxseed, nutrition bars, probiotic yogurt, fortified baked goods, and fortified edible oils. The market for functional foods was valued at US$ 0.7 Billion in 2015. This market is forecasted to grow to an approximate value of US$ 2 Billion by 2022 owing to the increasing health consciousness of people and their awareness about availability of such products.
A functional beverage is an emerging segment of the Indian nutraceuticals industry that was valued at US$ 0.3 Billion in 2015. Functional beverages, like Yakult, Ocean, Gatorade, are available in the form of energy drinks, vitamin water, fortified milk and buttermilk, and enhanced iced tea, among others. Various companies, including Danone, Dabur, PepsiCo, Coca-Cola, Amul, Britannia and Rasna, are introducing innovative beverages with enhanced nutritional value in order to woo the health conscious Indian consumers. The market for this type of beverages is forecasted to reach an approximate value of US$ 1.1 Billion by 2022. This exponential growth will be majorly due to the erratic eating habits of people and their efforts to make-up for the lost nutrients with the help of these easy-to-consume fortified beverages.
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The first stage forecastn++ of Southwest monsoon seasonal rainfall was issued by Indian Meteorological Department(IMD) in New Delhi today.n++ IMD has forecast that quantitatively, the monsoon seasonal rainfall is likely to be 96% of the Long Period Average (LPA) with an error of n++ 5%. Forecast assessment suggests 38% of probability for near normal monsoon rainfall.
n++IMD issues various monthly and seasonal forecasts of rainfall for the southwest monsoon season (June to September). Operational forecasts for the southwest monsoon season rainfall are issued in two stages. The first stage forecast has been issued today and the second stage forecast will be issued in June. These forecasts are prepared using state-of-the-art Statistical Ensemble Forecasting system (SEFS) that is critically reviewed and improved regularly through in-house research activities. Since 2012, IMD has been using the dynamical global climate forecasting system (CFS) model, which was developed under the Monsoon Mission. The original coupled ocean-atmospheric model framework of CFS was adopted from the National Centres for Environmental Prediction (NCEP), USA. The CFS model was further modified to provide improved rainfall forecasts over the Indian monsoon region through research efforts taken up under the Monsoon Mission.
The forecast for 2017 southwest monsoon rainfall over the country as a whole based on both the SEFS and the Monsoon Mission Climate Forecasting System (MMCFS) are as follows. IMDs SEFS model for the April forecast uses the following 5 predictors that require data monitored up to March.S. NoPredictorPeriod1
Then++ Sea Surface Temperature (SST) Gradient
December + Januarybetween North Atlantic andn++ North Pacific2
Equatorial South Indian Ocean SST
East Asia Mean Sea Level Pressure
February + March4
Northwest Europe Land Surface Air Temperature
Equatorial Pacific Warm Water Volume
February + March
Sea Surface Temperature (SST) Conditions in the equatorial Pacific & Indian Ocean
The weak La Nina conditions developed in the later part of the last monsoon season peaked in December 2016 and started weakening thereafter. Currently, neutral conditions are prevailing over the equatorial Pacific. The atmospheric conditions over the Pacific also reflect neutral El Nino conditions. The latest forecast from MMCFS indicates weak El Nino conditions to develop during the latter part of the monsoon season. However, there is no one to one relationship between El Nino and Indian Monsoon. For example, during 34% of El Nino years, monsoon season rainfall was normal or above normal.
At present, neutral Indian Ocean Dipole (IOD) conditions are prevailing over the Indian Ocean. The latest forecast from the MMCFS indicates weak positive IOD conditions are likely to develop during the middle of the monsoon season and to persist for some more months subsequently. Positive IOD conditions are likely to be favourable for a normal/above normal monsoon.
As the extreme sea surface temperature conditions over the Pacific particularly El Nino conditions over the Pacific (El Nino or La Nina) and positive IOD development over the equatorial Indian Ocean are known to have strong influence on the Indian summer monsoon, IMD is carefully monitoring the sea surface conditions over the Pacific and Indian oceans.
Forecast For the 2017 Southwest monsoon Season (June - Season) rainfall over the Country as a whole n++
n++ n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++ Monsoon Mission Coupled Forecasting System (MMCFS) based Assessment
For generating the forecast for the 2017 southwest Monsoon season rainfall, atmospheric and oceanic initial conditions during March 2017 were used. The forecast was computed as the average of the 44 ensemble members. The forecast based on the MMCFS suggests that the monsoon rainfall during the 2017 monsoon season (June to September) averaged over the country as a whole is likely to be 96% n++ 5%of the Long Period Average (LPA).
n++ n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++ Forecast Based on the Operational Statistical Ensemble Forecasting System (SEFS)
Quantitatively, the monsoon seasonal rainfall is likely to be 96% of the Long Period Average (LPA) with a model error of n++ 5%. Further, forecasts for the seasonal rainfall for the country suggest 38% probability for near normal rainfall scenario.
Summary of the Forecast for the 2017 southwest monsoon Rainfall
1. n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++ Quantitatively, the monsoon seasonal rainfall is likely to be 96% of the Long Period Average (LPA) with an error of n++ 5%.
2. n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++n++ Forecast assessment suggests 38% of probability for near normal monsoon rainfall
IMD will issue the update forecasts in early June, 2017as a part of the second stage long range forecast of monsoon rainfall. Along with the update forecast, separate forecasts for the monthly (July and August) rainfall over the country as a whole and seasonal (June-September) rainfall over various geographical regions of India will also be issued. By that time, more information on the evolution of El Nino and IOD will be available.
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In a significant move for high tech infrastructure with the view to improve mobility in train operations on the busiest route of Delhi Howrah section of Indian Railway network, Electronic Interlocking & massive Yard Remodeling has been commissioned at Dadri Railway Station in Uttar Pradesh which falls under Allahabad Division of North Central Railway. This project is part of ongoing process of modernization of Indian Railway network.
This Electronic Interlocking involves 318 routes adopting most Modern Signalling System with Centralized Operation controlling 45 Signals, 74 Points and 176 Track Circuits with massive yard remodeling. The another significant point is that this work has been commissioned in record time of only 150 minutes on 16th April 2017.
Dadri is a complex yard in North Central Railway spread over six kilometers on busiest route of Delhi-Howrah Section of Indian Railways and also having connectivity with National Thermal Power Corporation Power Plant and Container Depot.
With Commissioning of this, 3rd line between Aligarh-Ghaziabad section is made through Dadri Yard improving mobility in train operation which was earlier not available. This has also facilitated extension of platform No. 1, 2 & 3 and addition of new platform No. 4 at Dadri Station. All these four platforms have also been connected with new foot over bridge improving passenger amenity facilities at this station.
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