Economy
India remains global growth champ with 7.8 percent economy expansion in 2016
United Nations : India remains the global growth champion with its economy set to increase by 7.8 percent in the new year although a World Bank report released Thursday cut it from the 7.9 projected last June.
 
Overall the bank's Global Economic Prospects Report painted a gloomy global outlook cutting the global growth by almost a half percent to 2.9 percent in 2016 from the 3.3 percent forecast last June.
 
In the growth race among the major economies, China remains the runner-up with its economy projected to grow by 6.7 percent this year and 6.5 percent next year. The growth projections for U.S. economy are 2.7 this year, 2.4 next year and 2.2 in 2018.
 
It kept India's economic growth as measured by increase in gross domestic product at 7.9 percent for 2017, "although the pace of reforms has slowed somewhat." For 2018, it cut the projection from 8 percent made last June to 7.9 percent.
 
The report recognised India's resilience saying, "Compared to most other major developing countries, India is well positioned to withstand near-term headwinds and volatility in global financial markets due to reduced external vulnerabilities, a strengthening domestic business cycle, and a supportive policy environment."
 
However, it also drew attention to the dark clouds overhanging the reform process. "In India, progress in reforms is not assured as the upper house of parliament, which the ruling party does not control, has the power to block the government's legislative agenda," the report said. "A failure to pass the goods and services tax (GST) could hamper the government's ability to ramp up spending on infrastructure needs and preserve the status quo of fragmented domestic markets."
 
"Slow progress on land reforms could add to investment delays," it added. "And private investment growth may be unable to build further momentum. The financing of public-private partnerships also remains a challenge."
 
The report also referred to another area of concern, the slowdown in industrial production. Both the services and manufacturing Purchasing Managers' Indices (PMIs) have softened, it said. The PMI fell from 54.5 for December 2014 to 49.15 last month.
 
On the bright side, the report said, "The investment cycle is gradually picking up, led by a government efforts to boost investment in infrastructure, particularly roads, railways and urban infrastructure." It added that India's currency and stock markets weathered the volatility in the global financial markets last year. Sensex, a key Indian stock market index ended 2015 up 1.08 percent.
 
"Progress on infrastructure improvements and government efforts to boost investment are expected to offset the impact of any tightening of borrowing conditions resulting from tighter U.S. monetary policy," the report said. "Such investment will also lift potential growth over the medium term. Low international energy prices and domestic energy reforms will ease energy costs for Indian firms that tend to be energy intensive."
 
Other positives on India's report card that the World Bank noted were:
 
* Sharp reduction in current account deficit, to about 1 percent of GDP in the second quarter of 2015 from about 5 percent in mid-2013 during the turmoil in the financial markets over U.S. Federal Reserve policy.
 
* The central bank rebuilding reserves while net foreign direct investment (FDI) inflows have stayed positive.
 
* Reduction in the central government's fiscal deficit close to 4 percent of the GDP, down from a peak of 7.6 percent in 2009 through fiscal consolidation.
 
* The recently announced salary increases for public sector employees and support for urban spending from lower inflation offsetting fall in rural incomes because of two successively weak monsoons.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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SC allows SMYR Consortium to exit from collecting toll in Delhi
New Delhi : The Supreme Court on Thursday permitted SMYR Consortium LLP, which collects toll from vehicles entering the national capital for Delhi's municipal corporations, to exit from the contract as it contended that imposition of Environment Compensation Charge had adversely impacted the toll collections and its business.
 
The SMYR Consortium has said that imposition of ECC by the apex court's October 9, 2015 order and its being doubled by the court order of December 16, 2015, had resulted in nearly 35 percent fall in the vehicles entering the national capital, thereby adversely impacting its toll collections and business interest. 
 
Telling the consortium that its contract would cease on the morning of February 1 at 6 a.m., a bench comprising Chief Justice T.S.Thakur, Justice A.K.Sikri and Justice R. Banumathi said that it would continue to collect toll and ECC for the next three weeks, and said that it would pay the municipal body a contractual sum of Rs.10.5 crore every week for next three weeks.
 
The court said that any default in the payment of contracted toll amount of Rs.10.5 crore would result in the forfeiture of its bank guarantees and securitry amount which SMYR Consortium said stood at Rs.58 crore.
 
The court asked Additional Solicitor General Pinki Annand appearing for South Delhi Municipal Corporation to put in place, well in advance, a mechanism that will step in for collecting the toll in as soon as SMYR Consortium exits on February 1. 
 
Accepting SMYR Consortium's plea that it was incurring an additional expenditure of Rs.2 crore per month after the imposition of ECC which for three months of November, December and January came to Rs.6 crore, the court said that it was entitled to its reimbursement by the municipal body.
 
However, this sum was adjusted against shortfall of Rs.7.24 crore that SMYR had to pay to the municipal body as a part of toll collection under the contract. The court accepted amicus curiae Harish Salve plea and waved off the balance of Rs. 1.24 crore.
 
The apex court by its October 9, 2015 order had imposed ECC of Rs.700 on light commercial vehicles with two axles and of Rs.1,300 on commercial vehicles with three and four axles.
 
By its December 16 order, it doubled charge for loaded light commercial vehicles but retained the earlier rate for empty commercial vehicles.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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al-Qaida terrorist held in Bengaluru
New Delhi : A suspected member of the terrorist outfit al-Qaida has been arrested by Delhi Police in Begaluru, sources said here early on Friday.
 
The alleged member of the terror group, identified as Maulana Anzar Shah, was arrested on Wednesday night, Police sources said. 
 
According to sources, he was plotting to carry out a series of terror strikes in the country. "The aim of the group was to attack some prominent leaders along with the crowded and tourist places." 
 
Shah has been brought to Delhi on transit remand and would be produced at the Patiala House court here on Friday.
 
He was arrested by the anti-terrorist Special Cell wing of Delhi Police in its ongoing operation against al-Qaida in the Indian sub-continent (AQIS). 
 
The Special Cell had in December last year arrested two AQIS operatives Zafar Masood and Abdul Rehman. Reportedly, Shah's name popped up during their interrogation.
 
Another terrorist in custody, Mohammed Asif, the recruitment and training head of AQIS, had also confessed to meeting Shah at a religious congregation in Bengaluru, sources said.
 
According to sources, Shah had reactivated himself to provide logistical support when contacted by the AQIS operatives.
 
The Special Cell also has the details of financial transaction between them and Shah, the source added.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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