India’s merchandise trade deficit dipped to 12-month low of $17.7 bn in Jan, while services trade surplus rose to record $16.5 bn. Services exports jumped by more than $4 bn in December.
Retail inflation went up from 5.7% in December to 6.5% in January, largely driven by food prices, while India's Wholesale Price Index based inflation fell to 2-year low of 4.73% in January.
Markets were expecting pause in rate hike cycle after 25 basis points hike but RBI gave no such assurance. Globally, too, central banks have continued to tighten monetary conditions.
The Union Budget's impetus towards tourism and housing will help generate employment opportunities, plus rationalisation in food and fertiliser subsidy is a welcome development.
Issuance of green bonds will help India build global credibility, while transparent disclosure norms and specific screening criteria of green projects will diversify participation.
RBI report shows states’ capital expenditure was budgeted to grow by 38.4% in FY 22-23, but actual spending registered a year-on-year growth of only 0.9% in Apr-Oct 2022.
Services sector shows buoyant recovery but manufacturing estimated to decelerate due to weak external demand. Moderation in commodity prices could provide some support to the sector.
While domestic production's turned sluggish, exports have suffered owing to preferential tariff treatment towards countries like Bangladesh & Vietnam and cheap imports from China.
While persistent inflation led to failure to achieve inflation target in 2022 for the first time since 2016 and exports slowed down, the banking sector continued to be resilient.
Telangana, Andhra Pradesh, Haryana, Maharashtra, West Bengal, MP & UP had inflation in excess of upper band. For most of the states, rural inflation exceeded urban inflation.
India's projects related to BIMSTEC, Look-East-Act-East and Indian Ocean Rim Association could suffer a setback, impacting trade with South Asia and the South-South Cooperation agenda.
While global corporations setting up GCCs in India continue to express confidence in availability of skilled AI engineers, the panel argued that India’s real challenge lies elsewhere.
Without a Congress revival, there can be no challenge to the BJP pan-nationally. Modi’s party is growing, and almost entirely at the cost of the Congress.
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