Thread: Indian Economy

Chip maker launches India-designed Centrino product

Renault-Nissan likely to source parts from India

Volvo India posts 65% growth in truck segment

MTNL to acquire stake in Chinese telecom co

Boeing to invest USD 100 million in maintenance in Maharashtra

India to teach Ayurveda in US, to tap $40-bn herbal market

A-I inks Rs 35,000-cr pact with Boeing

MSEDCL lines up Rs 11,425 cr upgrade

Volvo's new city bus to cost Rs 70-80 lakh

Volvo today unveiled its city bus in India, Volvo B7RLE, developed on the Volvo 8700 platform.
The new city bus, that is likely to be priced between Rs 70 lakh and Rs 80 lakh, will first be seen on Bangalore roads where the state transport corporation has placed order for 25 units.

Chhabria showcases 3 remodelled vehicles

Dilip Chhabria Designs today showcased three of the re-modeled vehicles built on the existing range of Toyota Innova, Bajaj Tempo Traveller and Honda Accord.

A company executive said even while customising the products, special packages were offered, with price tag depending on how much built-up space the customer demanded.

‘Maruti’s price lower in 2006 than in 2001’

India's largest car-maker Maruti Udyog Limited’s managing director today said at the Auto Expo that prices of the company’s popular models, Zen, Esteem and M800 were lower in 2006 than in 2001 if one were to take inflation into account.

Visitors resent long walks at venue

Even as the Auto Expo claims to be the largest in Asia, in terms of the area, some exhibitors are unhappy with its expanse. If one has to go from, say, Hall No 1 to Hall No 14 and has no time to wait for the shuttle, one has to walk close to a kilometre. An exhibitor was heard commenting how foreign auto shows have most things under one roof.

HM launches Lancer’s Cedia

Hindustan Motors today launched Mitsubishi Lancer Cedia. “Cedia, loaded with power and aerodynamic enhancements, will be well received in the high performance compact sedan car market in India,” said Hindustan Motors Chairman C K Birla at the Auto Expo.

The models, priced at Rs 9.87 lakh (for both Lancer Cedia and Lancer Cedia Sports), are being manufactured at Hindustan Motors’ Chennai plant.

Tax cut or not, Khattar says he does not mind

Even as the expectation of tax cuts on small cars in the budget rises to a crescendo, Maruti, which is the market leader on the strength of its small cars, remains realistic. “We are happy even today. When you have no option, you learn to be happy,”said MUL managing director Jagdish Khattar.

Honda Motors may divest in Indian arm

J japanese auto giant Honda Motors today said it was willing to divest stake in Honda Siel Cars India Ltd to its domestic partner Siel Ltd.

“We are talking with the Siel group for a positive collaboration,” HSCI president and CEO M Takedagawa told reporters at the auto expo here.

Kandaa plans a Rs 1.5-lakh car

A Maharashtra-based company, Kandaa Motors, today said it was developing a car which would be sold in the market for Rs 1.5 lakh.

“Work has started on the project for developing a 800 CC car. We expect to design a prototype within the next 12 months,” Kanda Motors Chairman and Managing Director R S Kandaa said.

Timken may set up facility in India

US auto and industrial component major Timken Company today said it was looking at setting up a manufacturing facility in India for needle roller bearings to tap the growing domestic market.

US auto parts major bets big on India

Forex reserves rise by over $2 b

11th Plan target: less than 10% poor by 2012

NEW DELHI, JAN 15: The United Progressive Alliance (UPA) government is planning to set the ambitious target of bringing down the number of poor in the country (below poverty line or BPL people) to less than 10% of the total population by the end of the Eleventh Plan (2007-2012).

While admitting that it would be a difficult goal to achieve, Planning Commission officials said that the National Common Minimum Programme (NCMP) of the government had undertaken the commitment of providing food security to all and the least it could do was to try to bring down poverty to a single-digit level by 2012.

The last official estimates of poverty conducted by the National Sample Survey Organisation (NSSO) (55th round of large scale survey) had put the BPL population at 26.1% of the total population in 1999-2000. The proportion of poor in rural areas was relatively higher at 27.1% compared to the urban poor at 23.6% of the population.

The suggestion of reducing poverty to a single digit during the Eleventh Plan period has been included by the Planning Commission in the initial draft of the approach paper to the Plan. The approach paper will be discussed by the full Planning Commission (which includes the Prime Minister) and then ratified by the National Development Council (comprising chief ministers of states). The Eleventh Plan will be drafted on the basis of the approach paper.

The Tenth Plan (2002-07) had targeted reducing poverty level to 19.3% by 2007 and by 15% by 2012. Whether the economy is on track to realise the Tenth Plan objective will be revealed only when the figures of the 60th large survey of the NSSO is published. The UPA government, however, has decided to take the bull by the horn and target a single-digit poverty figure for 2012, ignoring the 15% target suggested in the Tenth Plan.

The controversy over the methodology used to collect the data in the 55th NSSO survey notwithstanding, the 1999 poverty figure of 26.1% was significantly lower than in 1994 when about 36% of the population was poor. India has come a long way in tackling poverty if we compare the present levels to the level of poverty in 1973 when more than half of India’s population (54%) lived below the poverty line.

No clue how they will acheave such a huge poverty drop so soon. The only way the pathetic dumb netas we have in power can reduce poverty is to relax labor laws so that more of the poor can get jobs in the manufacturing sector.....

They could also lower the minimum requirements for being considered "not poor" which would be another solution.

As long as BIhar and company do not see strong gdp growth rates like the rest of the country the target will be hard to meet...

I have been saying for months now that our GDP (700B USD) is based at constant 1993 prices. Revision occurs on Jan 31st with new 1999-2000 prices. Hence GDP will go up. SOme economists still say that the Indian accounting of gdp stinks and the real gdp is closer to 800+ but in any event the official figures come out soon so save your breath. Dont expect any Chinese style revisions though but let us remember that Pakistan had a similar revision last year and then used that as proof that its economy had grown like crazy..

New math set to alter GDP trajectory

Seetha
Tuesday, December 27, 2005 21:50 IST



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NEW DELHI: For those eating their hearts out at China revising its gross domestic product (GDP) upwards by 17%, wait till January 31, 2006. That’s when the Indian (GDP) estimation at constant prices (important for measuring growth) will be done on a new base year - 1999-2000, instead of the current 1993-94. That could see an upward revision of the Indian GDP as well, with a lot of new economic activities, especially in the services sector, getting captured.

The last time the base year was revised in 1999 - from 1980-81 to 1993-94, the GDP saw an upward revision of 9%. Though no one is willing to wager any guesses, there is a general feeling that the latest revision will also see another upward revision, though not on the scale of China’s.

That’s because Indian statistical systems have been more robust than the Chinese one and the chances of huge parts of the economy remaining outside their purview are not very high. This was the first time China had undertaken a full-scale survey of economic activity and, for a long period, many of the services were not considered as contributing towards GDP, says DH Pai Panandiker, president, RPG Foundation. The Indian revision will be only the result of a change in the base year, which will result in capturing new activities or changing the weightage of existing ones.

That’s not to say that the Indian national accounting system is error-proof. “The system is not well geared towards capturing new activities,” says Pronab Sen, principal adviser, Planning Commission. There’s also the black economy, which cannot be captured at all.

Much of the problem of economic activity remaining unaccounted for or underestimated occurs in the unorganised sector in both manufacturing and services. “The informal sector is not fully reflected,” agrees Panandiker. The problem, he says, is particularly acute in the services sector where a number of activities (cobblers, vendors, rickshaw-pullers, and even taxi drivers) fall outside the purview of any accounting system. Quite like in China.

The Central Statistical Organisation (CSO) estimates the unorganised sector through a multi-step process, starting with the quinquennial unemployment and employment surveys which give the number of employees in the workforce.

The value added per worker is based on the enterprise surveys, which cover one industry at a time, and benchmark estimates are then worked out for the base year. The production is then extrapolated on the basis of certain specified indicators. “These are assumptions; this is not accounting,” rues Panandiker.

D K Pant, fellow at the National Council of Applied Economic Research, agrees: “How much of activity in the unorganised sector is being under or overestimated is anyone’s guess.” CSO officials readily admit the unorganised sector is the only weakness in the methodology of the national accounts.

But economists feel that even the formal sector may be underestimated. The reporting system is not very robust, points out Pant, though he believes the extent of underreporting will be less in the case of the organised manufacturing sector. While large industry is almost fully covered, Panandiker feels there could be some leakages there as well.

Small scale industry (SSI), however, poses a problem, since there is no well-organised system of estimating the number of new entrants. This is a point both Sen and Panandiker make. Within this, the unregistered units (provisional estimates for 2003-04 in the third census of SSIs shows that they accounted for close to 86% of total units) pose the bigger challenge, a fact the mid-term appraisal of the Tenth Five-Year Plan also acknowledges.

The 9% revision in the last base year change is understandable, says Sen, because the 1980s saw a huge amount of change. He isn’t too sure if the change in the present revision will be that huge. The services sector, he feels, may not live up to the optimistic assumptions that are being made. Pant and Panandiker prefer to wait till January 31.

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