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Moodys: World Banks financial position remains robust due to strong capital base
Feb 20,2017

The financial position of the International Bank for Reconstruction and Development (IBRD or World Bank, Aaa stable) remains robust reflecting a strong capital base and liquidity position and substantial protection from large callable capital, says Moodys Investors Service in a report.

The IBRDs strict lending limitations, combined with its diversified portfolio composition and stable asset quality, ensure that it has sufficient capital to cope with its business risk. The bank uses various safeguards, including statutory lending limits, to protect its capital adequacy.

Under the lenders preferred creditor status, members of the World Bank Group, who are also the borrowers, pledge to prioritize debt service to the IBRD over other obligations, such as payments to market or bilateral creditors.

The IBRDs strong capital base should allow it to withstand crises in developing countries without impairing its ability to service its obligations, said William Foster, a Vice President and Senior Credit Officer at Moodys.

The IBRDs assets continue to perform very well, with only one country, Zimbabwe (unrated), in so-called nonaccrual status as of the end of the fiscal year (FY) 2016. Unlike some other multilaterals, the IBRD does not reschedule or write off its problem loans. Instead, it continues to seek full recovery of all arrears.

Problem loans at the bank have steadily decreased since FY 2005 when the ratio of non-performing loans to total loans outstanding reached 3.4%.

As a result of its development mandate and global scope, the bank lends to riskier sovereigns, some of which have no, or very limited access, to capital markets. The potential challenges arising from its lending activity partially offset its strengths.

There is a low probability that the IBRD could experience a material rise in non-performing loans should there be simultaneous financial crises that impact several large borrowers at once, or a regional crisis in one of its largest borrowing regions.

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Food processing sector to generate 9 million jobs by 2024: study
Feb 20,2017

Indian food processing sector has potential to attract US$ 33 billion of investment and generate employment of 9 million persons days by FY 2024, said an ASSOCHAM-Grant Thorton Research paper.

The food processing is a key contributor to employment generation in India. The policymakers have identified food processing as a key sector in encouraging labour movement from agriculture to manufacturing. By 2024, food processing sector is expected to employ 9 million people in India and expected to generate about 8,000 direct and 80,000 indirect jobs in the state, the ASSOCHAM-Grant Thornton joint study on Food Retail: Investment: Infrastructure noted.

According to the study, Indian food processing industry is pegged close to US$ 121 billion to US$ 130 billion. With the second largest arable land in the world, it is the largest producer of milk, pulses, sugarcane and tea in the world and the second largest producer of wheat, rice, fruits and vegetables.

Despite the massive production, the degree of processing is low and ranges between 2 to 35 percent for different produce. India is one of the top rankers in the production of bananas, guavas, ginger, papaya etc., although processing levels in the country remain limited. This indicates an extensive opportunity in the food processing sector, adds the paper.

According to the joint study, Indian food and retail market is projected to touch US$ 482 billion by FY 2020 from the current level of US$ 258 billion in 2015, adds the paper.

With globalisation and increasing trade across the borders approximately about 460 million tons of food valued at US$ 3 billion is traded annually. India has thus, a great potential for global trade in agricultural and processed food products. The share of food processing exports in total exports was around 12 percent in the last few years. During FY 2011-15, Indias exports of processed food related products have been growing at a CAGR of 23.3 percent.

The unorganised sector accounts for 42 percent of Indias food processing industry. The sizeable presence of small-scale industries points to the sectors role in employment generation. As per the study, though the market falls under the unorganised sector in the country, the organised sector has a larger share in the secondary processing segment than the primary one.

Food and grocery constitute a substantial part of Indias consumption basket accounting for around 31 percent share in the total. In contrast, consumers in other countries spend a much lower proportion of their income on food and groceryn++9 percent in the United States (US), 17 percent in Brazil and 25 percent in China. Food and grocery is the largest segment in Indias retail sector, with a share of more than 60 percent in Indias total retail market in 2014.

India is the worlds second largest producer of food after China. The arable land area of 159.7 mn hectares (394.6 mn acres) is the second largest in the world (after the US). India has a strong raw material base for the food processing industry. India is one of the largest producers of certain fruits, vegetables, pulses, cereals and dairy products such as mangoes, papaya, potatoes, onions, ginger, check peas, rice, wheat, groundnuts, milk and eggs among others.

Strong demand growth

n++ Demand for food processed food rising with growing disposable income, urbanisation, young population and nuclear families

n++ Household consumption set to double by 2020

n++ Changing lifestyle and increasing expenditure on health and nutritional foods

Food processing hub

n++ Indian benefits from large agriculture sector, abundant livestock and cost competitiveness

n++ Investment opportunities arise in agriculture, food infrastructure and contract farming

n++ Diverse agro-climatic conditions encourage cultivation of different crop

Increasing investment

n++ Govt. expect US$ 21.9 bn of investment in food processing infrastructure by 2015

n++ Investment including FDI would rise with strengthening demand and supply fundamentals

n++ Launch of infrastructure development schemes to increase investment in food processing infrastructure

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Gartner Says Worldwide Business Intelligence and Analytics Market to Reach $18.3 Billion in 2017
Feb 18,2017

Global revenue in the business intelligence (BI) and analytics software market is forecast to reach $18.3 billion in 2017, an increase of 7.3 percent from 2016, according to the latest forecast from Gartner, Inc. By the end of 2020, the market is forecast to grow to $22.8 billion.

According to Gartner, modern BI and analytics continues to expand more rapidly than the overall market, which is offsetting declines in traditional BI spending. The modern BI and analytics platform emerged in the last few years to meet new organizational requirements for accessibility, agility and deeper analytical insight, shifting the market from IT-led, system-of-record reporting to business-led, agile analytics including self-service.

The modern BI and analytics market is expected to decelerate, however, from 63.6 percent growth in 2015 to a projected 19 percent by 2020. Gartner believes this reflects data and analytics becoming mainstream. The market is growing in terms of seat expansion, but revenue will be dampened by pricing pressure.

Purchasing decisions continue to be influenced heavily by business executives and users who want more agility and the option for small personal and departmental deployments to prove success, said Rita Sallam, research vice president at Gartner. Enterprise-friendly buying models have become more critical to successful deployments.

Gartner believes the rapidly evolving modern BI and analytics market is being influenced by the following seven dynamics:

1. Modern BI at scale will dominate new buying n++ While business users initially flocked to new modern tools because they could be used without IT assistance, the increased need for governance will serve as the catalyst for renewed IT engagement. Modern BI tools that support greater accessibility, agility and analytical insight at the enterprise level will dominate new purchases.

2. New innovative and established vendors will drive the next wave of market disruption n++ The emergence of smart data discovery capabilities, machine learning and automation of the entire analytics workflow will drive a new flurry of buying because of its potential value to reduce time to insights from advanced analytics and deliver them to a broader set of people across the enterprise. While this smart wave is being driven by new innovative startups, traditional BI vendors that were slow to adjust to the current modern wave are driving it in some cases.

3. Need for complex datasets drives investments in data preparation n++ Business users want to analyze a diverse, often large and more complex combinations of data sources and data models, faster than ever before. The ability to rapidly prepare, clean, enrich and find trusted datasets in a more automated way becomes an important enabler of expanded use.

4. Extensibility and embeddability will be key drivers of expanded use and value n++ Both internal users and customers will either use more automated tools or will embed analytics in the applications they use in their context, or a combination of both. The ability to embed and extend analytics content will be a key enabler of more pervasive adoption and value from analytics.

5. Support for real-time events and streaming data will expand use n++ Organizations will increasingly leverage streaming data generated by devices, sensors and people to make faster decisions. Vendors need to invest in similar capabilities to offer buyers a single platform that combines real-time events and streaming data with other types of source data.

6. Interest in cloud deployments will continue to grow n++ Cloud deployments of BI and analytics platforms have the potential to reduce cost of ownership and speed time to deployment. However, data gravity that still tilts to the majority of enterprise data residing on-premises continues to be a major inhibitor to adoption. That reticence is abating and Gartner expects the majority of new licensing buying likely to be for cloud deployments by 2020.

7. Marketplaces will create new opportunities for organizations to buy and sell analytic capabilities and speed time to insight n++ The availability of an active marketplace where buyers and sellers converge to exchange analytic applications, aggregated data sources, custom visualizations and algorithms is likely to generate increased interest in the BI and analytics space and fuel its future growth.

Organizations will benefit from the many new and innovative vendors continuing to emerge, as well as significant investment in innovation from large vendors and venture capital-funded startups, said Ms. Sallam. They do, however, need to be careful to limit their technical debt that can occur when multiple stand-alone solutions that demonstrate business value quickly, turn into production deployments without adequate attention being paid to design, implementation and support.

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India Ratings Rates Indias First State Government Revenue Supported Bond Backed by RBI
Feb 18,2017

India Ratings and Research (India Ratings) on 16 February 2017 assigned U.P. Power Corporations (UPPCL) proposed INR100 billion bonds a Provisional IND AA(SO) rating with a stable outlook. This is Indias first state government revenue supported bond. India Ratings notes that while state/central government supported bonds, in the form of an unconditional and irrevocable guarantee are common, what makes this particular bond issue different from the bonds issued in the past is that in this case the entire state revenue is available for bond servicing. As the quarterly debt servicing of the proposed bond is only a fraction of the Uttar Pradesh state government revenue, India Ratings believes this structure will provide confidence to investors and timely servicing of the debt.

The rating action commentary: India Ratings Assigns U.P. Power Corporations Proposed Bonds Provisional IND AA(SO); Outlook Stable.

Another first for this transaction, is the structured debt servicing mechanism that is backed by the Reserve Bank of India (RBI). Under this mechanism, in case the specially created bond servicing account falls short of the amount required to service the debt and later if the state government is unable to fund it by a specified date then RBI will debit the requisite amount from the government of UPs account with the RBI and credit it to the UPPCL bond servicing account one day prior to the due date of bond servicing. This structure is similar to the power bonds issued by the state governments in 2003. As part of the one-time settlement of the dues owed by state electricity boards to public sector undertakings namely, NTPC Limited (IND AAA/Stable), NHPC Limited (IND AAA/Stable), Power Grid Corporation of India Limited and coal public sector units. An agreement was thus reached between 27 state governments, Union Ministry of Power and RBI in 2003, to release these bonds for the state-owned firms.

The UPPCL bond also has other regular security features such as state guarantee and debt-service reserve account. India Ratings believes the innovative structure put in place to service the bonds has the potential to open a new and alternative funding line for state governments in India, besides also imposing fiscal discipline on the state governments.

Based on bond market yields and banks lending rates, India Ratings expects UPPCL to save interest cost of around INR2-2.5 billion annually. Similar to UPPCL many other state power distribution companies under financial strain could rely on such structures for funding.

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Constant improvement in ease of doing biz & robust infrastructure development imperative for Indias all round economic growth: Report
Feb 18,2017

The government needs to continuously invest in improving the ease of doing business environment, develop sound infrastructure, and ensure availability of trained workforce as India is set on a growth trajectory that promises all-round development, economic welfare and strong macro-economic indicators, noted a recent ASSOCHAM-EY report.

n++Improved governance, favourable conditions to conduct business, transparency in government procedures and responsive policy making with an immediate focus on effective implementation of government reforms will continue to evolve India into a preferred destination for foreign investment,n++ highlighted the report titled India: Transforming through radical reforms, jointly conducted by ASSOCHAM and global advisory firm Ernst & Young (EY).

It also termed demonetisation as a major step aimed at strengthening Indias proposition of becoming a transparent economy by curbing black money, terror financing and fake currency circulating in the economy.

n++Combining demonetisation with Digital India and Pradhan Mantri Jan Dhan Yojna will ensure transparency in financial transactions. Transfer of subsidies through bank accounts opened under the scheme has removed the middlemen, thus eliminating one of the biggest contributors to corruption,n++ said the ASSOCHAM-EY report.

It also said that the GST (goods and services tax) which is expected to be rolled out by July 2017, will further boost the economy by simplifying the indirect tax structure, and eliminating the cascading effect of taxes on customers and make doing business easier in the country.

Hailing the Centres ambitious Make in India initiative, the report said that it has provided robust support to Indias manufacturing sector, backed by domestic demand and many regulatory reforms. It has helped India become the sixth largest manufacturing economy in the world in 2016.

Reforms like Power for All, Smart Cities, Skill India and Startup India are expected to work in tandem with Make in India to help the country achieve the goal of becoming a manufacturing hub, it added.

n++All these radical reforms are acting as enablers for boosting the domestic environment which in turn is improving the countrys stature globally,n++ further said the report. n++The major reforms from the Government will continue to boost investor sentiment and Indias outlook across the world.n++

It also complemented the Governments view of promoting innovation and entrepreneurship through reforms like Startup India and Skill India, to equip the young workforce to face the changing global economic environment and technological disruption.

While the pace of Indias radical reforms may vary, the direction is firmly set toward higher growth. The economy will continue to benefit from significant progress in trade, proactive policy actions and robust external buffers.

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Mineral Production during December 2016 was 5.2% higher as compared to December 2015
Feb 18,2017

The index of mineral production of mining and quarrying sector for the month of December (new Series 2004-05=100) 2016 at 144.5, was 5.2% higher as compared to December 2015. The cumulative growth for the period April- December 2016-17 over the corresponding period of previous year has been (+) 0.9 percent.

The total value of mineral production (excluding atomic & minor minerals) in the country during December 2016 was Rs. 22348 crore. The contribution of Coal was the highest at Rs. 9317 crore (42%). Next in the order of importance were: Petroleum (crude) Rs. 5553 crore, Iron ore Rs. 2438 crore, Natural gas (utilized) Rs. 2195 crore, Lignite Rs.804 crore and Limestone Rs. 528 crore. These six minerals together contributed about 93% of the total value of mineral production in December 2016.

Production level of important minerals in December 2016 were: Coal 642 lakh tonnes, Lignite 46 lakh tonnes, Natural gas (utilized) 2654 million cu. m., Petroleum (crude) 31 lakh tonnes, Bauxite 2081 thousand tonnes, Chromite 456 thousand tonnes, Copper conc. 11 thousand tonnes, Gold 151 kg., Iron ore 179 lakh tonnes, Lead conc. 26 thousand tonnes, Manganese ore 248 thousand tonnes, Zinc conc. 171 thousand tonnes, Apatite & Phosphorite 47 thousand tonnes, Limestone 247 lakh tonnes, Magnesite 20 thousand tonnes and Diamond 2096 carat.

The production of important minerals showing positive growth during December 2016 over December 2015 include Chromite (67.4%), Lignite (56.6%), Zinc conc. (38.9%), Iron ore (36.2%), Manganese ore (34.1%), Gold (28.0%), Lead conc. (22.3%), Bauxite (21.0%), Apatite & Phosphorite (10.7%), Limestone (5.8%), Coal (3.8%) and Natural gas (utilized) (0.4%). The production of other important minerals showing negative growth are: Diamond [(-) 37.2%], Copper conc. [(-) 21.5 %], Magnesite [(-) 19.6 %] and Petroleum (crude) [(-) 0.8%].

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Maximum Possible Marks to Indian NRA in WHO Assessment
Feb 18,2017

WHO has completed the assessment of the status of the Indian vaccine regulatory system against WHO NRA Global Benchmarking Tool (GBT) for benchmarking and measured the maturity of the system. The assessment has been carried out by a WHO team comprising lead experts in different areas from WHO Headquarters Geneva, WHO India Country Office, experts drawn from the regulators of USA, Italy, Germany, Netherlands, Indonesia, Thailand and Egypt. The assessment has been done in respect of nine different functionalities and Indian NRA has been declared functional with a maturity level of 4 i.e. the highest level as per currently evolved definitions in respect of 5 functions, and maturity level 3 in respect of 4 functions. While, maturity level 4 indicates good results and sustained improvement trends, maturity level 3 reflects systematic process based approach, early stage of systematic improvements, data availability regarding conformance to objectives and existence of improvement trends.

India is one of the main players in the pharmaceutical industry worldwide. The pharmaceutical industry covers conventional as well as biological medicinal products including vaccines, medical devices, and traditional medicines. India, as a large vaccine producing country, is currently supplying several vaccines to the UN agencies (UNICEF, WHO and PAHO).

A fully functional NRA is a pre-requisite for WHO prequalification of vaccines. One of the requirements to become eligible and retain prequalification status is to have the National Regulatory Authority (NRA) assessed as functional against the WHO published NRA indicators. WHO Prequalification Programme, as such, facilitates access to vaccines that meet the unified standards of quality, safety and efficacy as well as programme needs. The vaccine manufacturers can only apply for WHO vaccine prequalification if the NRA meets the standards of the WHO NRA published indicators i.e. WHO Global benchmarking Tool on functional regulatory system for vaccines.

World Health Organisation (WHO) has, based on a robust benchmarking tool developed over years in consultation with various experts drawn from across the globe, carried out assessment of the National Regulatory Authority (NRA) of India comprising the Central Drugs Standard Control Organisation (CDSCO), State Drug Regulatory Authorities, Pharmaco-vigilance Programme of India (PvPI) and Adverse Events Following Immunization (AEFI) structures at the Central and States levels. The nine functions included in the tool are National Regulatory System; Registration and Marketing Authorization; Vigilance; Laboratory Access and Testing; Regulatory Inspection; Clinical Trial Oversight; NRA Lot Release; Licensing Premises; and Market Surveillance and Control. The Global Benchmarking Tool (GBT) so developed has 63 indicators and 288 sub-indicators, out of which 150 are critical with the following maturity level definitions:

The result reflects the growing maturity of the Indian NRA emanating from a concerted effort by the Government in consultation WHO to build capacity and capability of the National Regulatory Authority over last several years.

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The total horticulture production of the country is estimated to be around 286 million tonnes during 2015-16
Feb 17,2017

The Department of Agriculture and Farmers Welfare has released the Final Estimates: 2015-16 and First Advance Estimates of 2016-17, of area and production of horticulture crops. These estimates are based on the information received from different State/UTs in the country.

The following table summarizes the All-India Final Estimates: 2014-15, Final Estimates: 2015-16 & First Advance Estimates: 2016-17;

(Area in 000 Ha, Production in 000 MT)Total Horticulture2014-152015-16 ( Final)2016-17 (First Advance Estimate)(Final)Area234102447224369Production280986286188287323

Highlights: - 2015-16 (Final Estimates)

n++         The total horticulture production of the country is estimated to be around 286 million tonnes during 2015-16 which is 2% higher than the previous year.

n++         Production of fruits is estimated to be 90 million tonnes which is 1% higher than the previous year. 

n++         Production of vegetables is estimated to be around 169 million tonnes which is about 1.5% higher than the previous year.

n++         Production of spices is estimated to be around 7 million tonnes which is 14% higher than the previous year.

n++         Production of onion is estimated to be around 209 lakh tonnes which is 11% higher than the previous year.

n++         Production of potato is estimated to be around 434 lakh tonnes which is 10% lower than the previous year.

n++         Production of tomato is estimated to be around 187 lakh tonnes which is about 15 % higher than the previous year.

Highlights:- 2016-17 (First Advance Estimates)

n++         The horticulture production of the country during 2016-17 is estimated to be around 287 million tonnes which is marginally higher as compared to 2015-16.

n++         Production of fruits is estimated to be 92 million tonnes which is about 2% higher than the previous year.                                                                                              

n++         Production of vegetables is estimated to be around 168.6 million tonnes which is marginally lower by 0.3% than the previous year.

n++         Production of spices is estimated to be around 7 million tonnes which is almost same as previous year.

n++         Production of onion is estimated to be around 197 lakh tonnes which is 6 % lower than the previous year, which was a bumper production year. However as compared to the past 5 years average onion production, this is about 5% higher.

n++         Production of potato is estimated to be around 439 lakh tonnes which is 1% higher than the previous year.

n++         Production of tomato is estimated to be around 189 lakh tonnes which is about 1 % higher than the previous year.

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Fitch: Banks Globally Continue to Face Profits Challenge
Feb 17,2017

Fitch Ratings, in its Financial Institutions 2017 Outlooks Compendium, highlights that positive fundamentals in the banking sector continue to be challenged by below-trend economic growth and low or negative interest rates in core markets. Weak growth exerts pressure on the quality of legacy assets while dampening demand for new credit. Low or negative rates make it more difficult to manage net interest margins, squeezing profits.

The ongoing impact of conduct risk penalties for certain entities, political uncertainty, regulatory changes, and country-specific or idiosyncratic event risks are likely to challenge banks globally in 2017, said David Weinfurter, Global Group Head of Financial Institutions at Fitch.

With a few notable exceptions, banks and banking systems around the world are now materially less risky, with consistently improved credit fundamentals. However, macro-economic factors, enhanced regulation, legacy issues and business model dynamics have made delivering returns on equity that exceed the cost of equity far more challenging.

2017 bank rating Outlooks diverge for developed and emerging markets. In the developed markets the distribution of Outlooks is 80% Stable, 8% Positive, and 12% Negative at 1 January 2017. In the emerging markets the Outlook distributions were 68% Stable, 2% Positive, and 30% Negative as of the same date. In addition, there have already been notable emerging-market bank downgrades in 2017, for example in Costa Rica and Turkey, triggered by sovereign downgrades, with Outlooks now Stable.

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Digital & cashless transactions to boost GDP- Arjun Ram Meghwal
Feb 17,2017

Digital and cashless transactions would boost GDP growth of the country in a meaningful transition for Indian economy, said Mr Arjun Ram Meghwal, Honble Minister of State for Finance and Corporate Affairs, Government of India.

He said India was on the verge of a transition from a largely cash economy to a less cash and a more digital economy. He said the move to demonetize was in accordance with the n++general will of the citizens of India towards a corruption-free societyn++.

Mr Meghwal said, n++Promotion of a digital economy has had a transformative impact and the people of India have supported the initiative. For the common man, a shift to digital payments has generated significant benefits. Migration to Digital Payments is the way forward towards a cashless economy. The Government of India has conducted various initiatives to spread awareness about the move. The Government of India was empowering people in non-urban and rural areas to enable them to adopt technology. Embracing digital and cashless economy was the collective responsibility of the Government, citizens as well as the corporate sector.n++

Mr Umang Das, Conference Chairman and Chairman, CII National Sub-Committee on Telecom Infrastructure, said, n++Demonetisation is the biggest positive step undertaken for the betterment of the country. With the Governments flagship Digital India Programme, adoption of digital payments is playing a crucial role in realizing the vision of a digitally-empowered economy. The vision also aims to change life in rural India by making every citizen a Netizen who will be fully-empowered citizens.n++

Mr Vinay Thakur, Director (Projects), National e-Governance Division, Ministry of Communications and Information, Government of India, said, n++The Government of India has drawn a roadmap towards digitally-empowered society with the focus on integration of services to citizens. We are working on enhancing digital infrastructure for high-speed connectivity aiming at paperless and cashless services.n++

Mr Stephen Kehoe, Senior Vice-President and Head of Global Financial Inclusion, Visa Inc., USA, said, n++The DFS providers have both a great opportunity to step up and be counted as India looks for support in its efforts to deliver a cash-lite economy. We need to use the recommendations to guide our own investments into new solutions for underserved and unbanked Indians across the whole country.n++

Mr P Balaji, Director - Regulatory, External Affairs & CSR, Vodafone India, said n++The Prime Minister and the Government of India have set the vision for Digital India and have taken several pioneering initiatives towards actualising it and to accelerate Indias progression into a less cash economy. The opportunity is to drive this usage for other transactions and enable seamless conversion of cash into digital currency and vice-versa. Payment banks and mobile wallets have an important role in enabling this. With appropriate policy changes, around 2 million retail outlets can easily become microtellers overnight and this can be a game changer move where the payment licensees can be leveraged to leapfrog to a cashless economy.n++

Mr Monish Shah, Partner, Deloitte Touche Tohmatsu India LLP, said, n++As India becomes increasingly digital, customers data will get created on how they live, save, behave, transact and interact. Integration of digital and financial identity of an individual will provide a unique opportunity to understand the individual needs, aspirations as well as credit worthiness. Developing a robust merchant ecosystem is paramount in creating a digital highway in influencing customer adoption and driving customer experience and engagement.n++

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Stronger collaboration between Asia Pacific countries key to empowerment and digital transformation
Feb 17,2017

n++Networks are the key to transforming India into a knowledge based society and a digital economyn++, pointed out Mr P P Chaudhary, Union Minister of State for Law and Justice and Electronics and Information Technology.

The Minister emphasized upon Indias strong position at the digital frontier, riding on the back of the National Digital India Mission, the Jan Dhan-Aadhar-Mobile (JAM) trinity, the role of Direct Benefits Transfer in reaching welfare schemes to the poor and a robust e-Governance infrastructure enabling delivery of citizen centric services to the last mile. He also pointed out the dynamic role played by the Village Level Entrepreneurs in empowering the villages of India and fostering social inclusion.

Inviting international collaboration on high quality research on digital technology, Dr Ajay Kumar, Additional Secretary, Ministry of Electronics & Information Technology, Government of India said that the Asia Pacific region comprises the vortex of internet activities and it is essential to create strong linkages through a number of collaborative efforts like the Visvesvaraya PhD Scheme and Global Innovation and Technology Alliance (GITA), that are supported by the Government of India. He called upon the Asian Pacific countries to play a greater role in global internet governance policy making through greater collaboration and participation.

Dr Neena Pahuja, Director General, ERNET highlighted that technology has helped in creating transparency & disruptive changes. With the base of high speed advanced networks, we are now on the verge of witnessing another wave of disruptive change both in industry and also in day-to-day lifes. In Industry, the connected environment is helping in better productivity and applications such as preventive healthcare, disaster mitigation, remote soil health check-ups are now becoming reality.

She added that India has very big plans to empower every citizen with access to digital services, knowledge and information, and is investing in large scale connected environment. The ambitious project of creating 100 Smart Cities in India will also ride on strongly connected cities.

Mr Bhaskar Pramanik, Chairman, CII National Committee on IT & ITeS and Chairman, Microsoft Corporation said that the digital revolution was reminiscent of the Industrial revolution and would have major impact on the social fabric, healthcare, education system and a plethora of sectors including agriculture, defense, MSME, skills, among others. n++Technology should flow from the technocrats to the people who turn the wheels of the economyn++, he said. He also laid emphasis upon industry - academia collaboration that will take the digital revolution, a step further.

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Retail inflation in Delhi, J&K more than double national average, demonetization possible reason: ASSOCHAM
Feb 17,2017

The retail inflation may have been hovering at quite a reasonable level of 3.17 per cent for January, 2017 on an all-India basis, but there is no respite for people right in Delhi along with a couple of other states, suffering the price rise at double the national average, with demonetization leaving its possible impact, an ASSOCHAM analysis has noted.

n++Against the national average of 3.17 per cent, Delhi had to bear the inflation rate, measured by the Consumer Price Index (CPI) at 6.32 per cent, while it was 7.01 per cent for Jammu and Kashmir (J&K) and 5.92 per cent for Himachal Pradesh,n++ said the ASSOCHAM analysis of the inflation data.

It also noted that in the rural belt of the national capital, the CPI inflation was close to seven per cent at 6.85 per cent. Similarly the rural areas of Jammu and Kashmir and HP which were quite high on the retail inflation chart, witnessed quite a high rate of price rise in January, 2017 year on year.

In J& K rural and far flung, the CPI inflation was 9.08 per cent and for the similar areas of HP it was 6.17 per cent, adds the ASSOCHAM.

n++The CPI inflation for January, 2017 on an all India level is much lower at 3.17 per cent than the one measured on the Wholesale Price Index, at 5.25 per cent. One of the plausible reasons could be the impact of demonetization on the supply chain, n++said ASSOCHAM President Mr Sandeep Jajodia.

But, what is more surprising is the huge gap between retail inflation in Delhi and the national average. n++ This was not expected at least in Delhi, especially when the phenomenon was not seen even in the neighbouring states of Haryana, UP and Punjab, thought it was slightly over four per cent in these statesn++, the chamber said, adding the demonetization would have led to supply chain disruption more in the national capital than other states.

In any case, there are several supply chain issues which can be fixed only by an efficient transport that is a function of a huge investment needed in building quality roads, rail network, air cargo and a well integrated and modern cargo movement trade, said Mr. Jajodia.

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There has been a growth of 72% in the tourists arrived on e-Visa during January 2017 over January 2016
Feb 17,2017

Foreign Tourist arrivals to India and Foreign Tourist availing E-Visa facility during January 2017 Ministry of Tourism compiles monthly estimates of Foreign Tourist Arrivals (FTAs) & FTAs on e-Visa on the basis of Nationality-wise, Port-wise data received from Bureau of Immigration (BOI). Accordingly, for the month of January 2017, a growth of 16.5% is observed as compared to January 2016, surpassing the previous years corresponding growth of 6.8% observed in January 2016 over January 2015. Correspondingly, there has been observed a growth of 72% in the tourists arrived on e-Visa during January 2017 over January 2016 by registering a figure of 1.52 Lakhs as compared to 0.88 Lakhs in the month of January 2016. Clearly, the share of tourists availing e-Visa facility in January 2017 has reached a level of 15.5% as against 10.4% in the month of January 2016. This clearly outlines the steady success of e-Visa facility in quantifiable terms.

Following a modified approach, Ministry of Tourism from the month of January 2017, shall be presenting monthly Foreign Tourist Inflows to India as well as the Foreign Tourists who availed e-Visa facility, simultaneously.

The following are the important highlights regarding FTAs & FTAs on e-Visa from tourism during the month of January, 2017.

Foreign Tourist Arrivals (FTAs):

n++ The number of FTAs in January, 2017 were 9.83 lakh as compared to FTAs of 8.44 lakh in January, 2016 and 7.91 lakh in January, 2015.

n++ The growth rate in FTAs in January, 2017 over January, 2016 is 16.5% compared to 6.8% in January, 2016 over January, 2015.

n++ The percentage share of Foreign Tourist Arrivals (FTAs) in India during January 2017 among the top 15 source countries was the highest from USA (15.01%) followed by Bangladesh (14.91%), UK (11.11%), Canada (4.63%), Russian Fed. (4.46%), Australia (3.65%), Malaysia (3.15%), Germany (2.92%), France (2.89%) and China (2.54%), Sri Lanka (2.45%), Japan(2.15%),Afghanistan (1.84%), Rep. of Korea (1.61%) and Nepal (1.60%).

n++ The percentage share of Foreign Tourist Arrivals (FTAs) in India during January 2017 among the top 15 ports was the highest at Delhi Airport (28.30%) followed by Mumbai Airport (18.23%), Haridaspur Land checkpost (8.17%), Chennai Airport (7.32%), Goa Airport (6.51%), Bengaluru Airport (5.32%), Kolkata Airport (4.32%), Cochin Airport (3.73%), Ahmedabad Airport (3.37%) and Hyderabad Airport (2.74%), Gede Rail Land checkpost (1.77%), Trivandrum (1.62%), Trichy Airport (1.38%), Ghojadanga land checkpost (1.08%) and Amritsar Airport (1.02%).

Foreign Tourist Arrivals (FTAs) on e-Visa

n++ During the month of January, 2017 total of 1.52 lakh tourist arrived on e-Visa as compared to 0.88 lakh during the month of January 2016 registering a growth of 72.0%

n++ The percentage shares of top 15 source countries availing e-Visa facilities during January, 2017 were as follows:

UK (22.9%), USA (13.6%), Russian Fed (8.3%), China (6.3%), France (5.6%), Australia (4.4%), Germany (4.1%), Canada (3.6%), Korea (Rep.of) (3.2%) and Ukraine (2.2%), Netherlands (1.6%), South Africa (1.4%), Singapore (1.3%), Malaysia (1.3%) and Sweden (1.1%).

The percentage shares of top 15 ports in tourist arrivals on e-Visa during January, 2017 were as follows:

New Delhi Airport (36.5%), Mumbai Airport (20.5%), Dabolim (Goa) Airport (16.2%), Chennai Airport (7.0%), Bengaluru Airport (5.1%), Kochi Airport (4.2%), Kolkata Airport (2.7%), Trivandrum Airport (2.0%), Hyderabad Airport (2.0%) and Ahmadabad Airport (1.7%), Amritsar Airport (0.8%), Jaipur Airport (0.5%), Tirchy Airport (0.4%), Gaya Airport (0.2%)and Lucknow Airport(0.1%).

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Insurance penetration in India likely to cross 4 pc this year: ASSOCHAM
Feb 17,2017

Governments policy of insuring the uninsured has gradually pushed insurance penetration in the country and proliferation of insurance schemes are expected to catapult this key ratio beyond 4 per cent mark by the end of this year, reveals the ASSOCHAM latest paper.

Despite the gentle rise in insurance penetration which is percentage of insurance premium with reference to the Gross Domestic Product (GDP), it is still far below the global average, according to paper titled Insurance penetration in India, by the Associated Chamber of Commerce and Industry of India (ASSOCHAM).

The insurance penetration has started its northward journey is evident from the fact that it has increased from 3.3 per cent in 2014 to 3.44 per cent in 2015 on the back of various insurance schemes launched by the government, adds the paper.

As part of social security initiative, the government has launched low premium insurance schemes both life and non-life in 2015. Last year, it introduced crop insurance.

With objective to provide insurance cover to all, the Government launched Pradhan Mantri Suraksha Bima Yojna (PMSBY) and Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJBY) in 2015, noted the study.

PMSBY offers a renewable one-year accidental death-cum- disability cover of Rs 2 lakh for partial/permanent disability to all savings bank account holders in the age group of 18-70 years for a premium of Rs 12 per annum per subscriber. The scheme is managed by general insurance firms, adds the chamber.

PMJJBY, on the other hand, offers a renewable one year life cover of Rs 2 lakh to all savings bank account holders in the age group of 18-50 years, covering death due to any reason, for a premium of Rs 330 per annum per subscriber.

Besides, Pradhan Mantri Fasal Bima Yojana (PMFBY) launched last year to provide financial support to farmers suffering crop loss or damage arising out of unforeseen events will also add to insurance penetration.

PMFBY has been approved for implementation in all States and Union Territories from Kharif 2016 season in place of National Agricultural Insurance Scheme (NAIS) and Modified National Agricultural Insurance Scheme (MNAIS).

PMFBY is a significant improvement over the earlier schemes on several counts and comprehensive risk coverage from pre-sowing to post-harvest losses are some of the salient points. A budget provision of Rs 5501.15 crore has been made for the scheme for the current crop season, ASSOCHAM President Mr. Sandeep Jajodia said.

Rashtriya Swasthya Bima Yojana (RSBY) is a government-run health insurance scheme that provides for cashless insurance for hospitalisation in public as well as private hospitals. The scheme is force since April 1, 2008 and has been implemented in 25 states.

The number of lives covered under Health Insurance policies during 2015-16 was 36 crore which is approximately 30 per cent of Indias total population. The number has seen an increase every subsequent year as 28.80 crore people had the policy in the previous fiscal.

The measure of insurance penetration and insurance density calculated as the ratio of premium to population or per capita premium reflects the level of development of insurance sector in a country, said ASSOCHAM President.

During the first decade of insurance sector liberalization, the sector has reported consistent increase in insurance penetration from 2.71 per cent in 2001 to 5.20 per cent in 2009.

However, since then, the level of penetration has been volatile and remained below the peak. It declined from 3.9 to 3.3 per cent in 2014 due to certain regulatory changes and unfavourable market conditions.

This trend was observed in the level of insurance density which reached the maximum of USD 64.4 in the year 2010 from the level of USD 11.5 in 2001. During 2015, the insurance density moderated to USD 54.7. The insurance density of life insurance business had gone up from USD 9.1 in 2001 to reach the peak at USD 55.7 in 2010 and declined to USD 43.2 in 2015.

The life insurance penetration surged from 2.15 per cent in 2001 to 4.60 per cent in 2009. Since then, it has exhibited a declining trend reaching 2.6 per cent in 2014.

However, there was a slight increase 2015 reaching 2.72 per cent in 2015 when compared to 2.6 per cent in 2014. The Insurance Penetration for the insurance sector as a whole in 2015 was 3.4 per cent in India, as against world average of 6.2 per cent.

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India Ratings Maintains Stable Outlook for Auto for FY18
Feb 17,2017

India Ratings & Research (Ind-Ra) has maintained a stable outlook on the auto sector for FY18. This is based on the expectation of a moderate yoy volume growth of 6%-9% for the passenger vehicle (PV) segment, and despite an expected negative 2% to 2% slowdown in the commercial vehicle (CV) segment. The agency believes that growth in the PV segment would be driven by 15%-20% yoy volume increase in utility vehicles (UV), with cars likely to register a lower growth of 3%-5% yoy. The slowdown in the CV segment is expected to be on account of a 9%-12% decline in medium and heavy commercial vehicles (MHCVs), partially offset by a 6%-9% growth in light commercial vehicles (LCVs).

Another factor supporting the agencys stable sector outlook is the continued strong financial profile of the 10 listed companies in its sample set. The mean FY16 EBITDA margin for the agencys sample set was 12.4% (9MFY16: 12%), with EBITDA gross interest cover maintained at above 100x. In Ind-Ras assessment, mean leverage (net debt/EBITDA) would continue to be maintained below 1x in FY17 and FY18. The credit profile of the companies outside the sample set (comprising mostly subsidiaries of overseas auto companies) would benefit from the support potentially available from strong parent companies.

Ind-Ra believes that the governments demonetisation drive had a limited impact on the auto sector as most of the auto original equipment manufacturers have countered build-up of channel inventory through higher discounts without altering their production schedules with vendors. Moreover, the impact of demonetisation was restricted largely to the two-wheeler segment, given the relatively higher proportion of cash transactions considering the low ticket size of purchases versus PVs and CVs.

In the agencys assessment, MHCV volumes would decline in FY18 due to depletion of replacement demand, inconsistent Index of Industrial Production, and sales volumes artificially propped up in FY17 due to pre-emptive purchases to avoid paying higher prices from April 2017, when vehicles need to be BSIV compliant. Contrarily, LCV volumes would continue to be supported by demand for last mile transportation, arising from a substantial increase in the online retail sales.

Ind-Ra estimates domestic scooter volumes would grow by 15%-18% in FY18 (close to the estimated FY17 growth rate), but lower than the previous years due to the base effect. The agency expects motorcycle volumes to recover slightly over April-December 2016 yoy growth level of 6.3%, with increased currency in circulation, leading to a demand revival in 4QFY17 and FY18.

Furthermore, the agency believes that the Goods and Service Tax (GST) will be largely neutral for the industry, as reduction in logistics and supply chain costs would be partly offset by an increase in the effective tax rate.

Outlook Sensitivities

Positive Outlook Unlikely: Given the structural issues of overcapacity and intensifying competition, Ind-Ra does not envisage a positive outlook revision in the event of a revival in sales. However, curtailment or postponement of planned capacity additions, coupled with sales volumes higher than the agencys expectations, could have a positive impact on the credit profile of the sector.

Weak Demand, External Shock: A sustained reduction in CV volumes due to slowdown in industrial production, together with moderation in PV volumes due to rising fuel prices and weak consumer sentiments among others, could have a negative impact on the sector outlook.

Additionally, any external shock pressuring the rupee and a subsequent spurt in the interest rate may have a moderate impact on the sector, thus impacting the volumes, as well as the credit profile of auto companies.

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