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New Delhi: India has proven the 'fallacy' of incompatibility of rapid <keyword id="19900794" type="General" weightage="20" keywordseo="economic-growth" source="keywords">economic growth</keyword> and a democratic political system, and the continuity of government and policies give industry the confidence of <keyword id="22932843" type="General" weightage="20" keywordseo="sustained-high-growth" source="keywords">sustained high growth</keyword>, <keyword id="19909974" type="General" weightage="100" keywordseo="Maruti-Suzuki" source="keywords" meta.keywordsubtype="org" meta.entityname="Maruti Suzuki" meta.hostid="261" meta.entityid="Maruti Suzuki">Maruti Suzuki</keyword> India Chairman R C Bhargava said on Tuesday. In his address to shareholders in the company's Annual General Meeting held virtually, he asserted that India's <keyword id="20442128" type="General" weightage="20" keywordseo="democratic-processes" source="keywords">democratic processes</keyword> will lead it to a sustained and more equitable society. Bhargava also said the industry and the government can work with trust and confidence with each other to achieve the goal of India becoming a developed country by 2047. "Over the years, I've heard people arguing that rapid economic development and a democratic political system are not really compatible. Our country has proved the fallacy of this line of thinking," he said. Asserting his point, Bhargava said, "We are now the fastest growing economy in the world, and our prime minister is one of the most respected global leaders." Periodically, he said, "the world has seen how deeply committed we are to the democratic processes." Referring to the recent general elections, he said it has "once again shown that hundreds of millions of people can vote in a peaceful manner and accept the results of that process." Bhargava, however, admitted that "the policies and strategies for equitable and rapid economic growth and development did take some time in being established". ".. But we did find the right path through peaceful democratic processes. This is in sharp contrast to what we have seen around us in many parts of the world and in our neighborhood," he said, without naming Bangladesh which is currently in turmoil following student-led violent protests that led to a regime change. "The continuity of the government and its policies to bring in faster economic growth with greater inclusivity and equity gives industry confidence of sustained high growth," Bhargava said. He further said industry and government can work with trust and confidence with each other to achieve the goal of India becoming a developed country by 2047. "It is the democratic processes which will lead us to a sustained and more equitable society," he said.

Continuity of government, policies give industry confidence of sustained high growth: Maruti Suzuki Chief

<keyword id="19895437" type="General" weightage="20" keywordseo="investment" source="keywords">Investment</keyword> in <keyword id="20300870" type="General" weightage="100" keywordseo="equity-mutual-funds" source="keywords">equity mutual funds</keyword> surged over five-fold to Rs 94,151 crore in the June 2024 quarter against Rs 18,358 crore a year ago, driven by a strong <keyword id="21477327" type="General" weightage="20" keywordseo="economic-environment" source="keywords">economic environment</keyword>, supportive <keyword id="22575274" type="General" weightage="20" keywordseo="government-fiscal-policies" source="keywords">government fiscal policies</keyword>, <keyword id="19900618" type="General" weightage="20" keywordseo="investors" source="keywords">investors</keyword> confidence and robust <keyword id="21990858" type="General" weightage="20" keywordseo="stock-return" source="keywords">stock return</keyword>. This has also pushed the industry's assets under management (<keyword id="20019621" type="General" weightage="20" keywordseo="AUM" source="keywords">AUM</keyword>) by 59 per cent to Rs 27.68 lakh crore in June from Rs 17.43 lakh crore a year ago, data from the Association of Mutual Funds in India (<keyword id="20090036" type="General" weightage="20" keywordseo="AMFI" source="keywords">AMFI</keyword>) showed. The robust gain in the asset base was also replicated in the growth of investors in equity mutual funds, with the number of folios closing at 13.3 crore, adding an investor base of over 3 crore. The significant gain in equity folios indicates broader participation across investor segments, driven by improved <keyword id="19929245" type="General" weightage="20" keywordseo="financial-literacy" source="keywords">financial literacy</keyword> and accessible investment platforms, Trivesh D, COO of stock trading platform Tradejini, told PTI. According to the AMFI data, equity-oriented mutual fund schemes invested Rs 94,151 crore in the quarter ended June 2024. This comprises Rs 18,917 crore in April, Rs 34,697 crore in May and Rs 40,537 crore in June. The investment in equity-oriented mutual funds jumped five-fold to Rs 94,151 crore in the June quarter from Rs 18,358 crore in the quarter ended June 2023 and increased 32 per cent Rs 71,280 crore witnessed in the preceding March 2024 quarter. "The confluence of political stability, supportive government policies, and a favourable economic environment has significantly contributed to the impressive inflows into equity mutual funds, signalling a positive outlook for the sector," Trivesh said. Strong macroeconomic fundamentals, bolstered by supportive government fiscal policies like higher-than-budgeted tax collection growth, reduced revenue expenditures, and increased capital spending have helped in increasing the allocation to equity mutual funds, Feroze Azeez, Deputy CEO, Anand Rathi Wealth, told PTI. He further said that investors' confidence in the markets and historically strong returns given by Indian equities with relatively low risk also helped investors to move towards equity mutual funds. Additionally, the shift was further fuelled by a transition from traditional investments like deposits to mutual funds in pursuit of higher returns. "The long-term outlook remains positive, with expectations of 11-13 per cent annual returns for Indian equities, and equity mutual funds potentially delivering even higher returns," Azeez said. Within the equity segment, sectoral or thematic category attracted Rs 46,731 crore during the quarter under review, followed by Multi-cap (Rs 10,077 crore), Flexicap (Rs 8,387 crore), Large &amp; Midcaps (Rs 7,948 crore), Smallcap (Rs 7,197 crore) and Midcap (Rs 6,927 crore). Large-cap funds witnessed an infusion of Rs 1,991 crore during the April-June quarter of the current financial year (FY25). Moreover, inflows into the systematic investment plan (<keyword id="19956399" type="General" weightage="20" keywordseo="SIP" source="keywords">SIP</keyword>) have been rising continuously for the past several months. The monthly SIP contributions crossed the Rs 21,000 crore mark in June, with the total inflow reaching an all-time high of Rs 21,262 crore. This shows investors' commitment to disciplined and long-term investing. The fund infusion through the SIP route was Rs 62,537 crore in the April-June quarter of FY25, a remarkable surge from Rs 43,211 crore in the same quarter preceding the fiscal.

Investment in equity mutual funds surge 5-fold to Rs 94,151 cr in June qtr amid robust eco environment

In response to higher-than-expected tax revenue and a record surplus transfer from the Reserve Bank of India (RBI), the Indian government is considering an 8-10% increase in <keyword id="20018917" type="General" weightage="20" keywordseo="capital-expenditure" source="keywords">capital expenditure</keyword> (capex) for the fiscal year 2025, according to Pantomath Group's quarterly report, "Market Kaleidoscope: Quarterly Market Insights." This adjustment could raise the capex from the previously allocated Rs 11.11 lakh crore, aiming to bolster infrastructure and economic growth. This fiscal boost comes as India reaches a historic financial milestone. The total market capitalization of all stocks listed on the Bombay Stock Exchange (<keyword id="19895774" type="General" weightage="20" keywordseo="BSE" source="keywords">BSE</keyword>) briefly surpassed $5 trillion for the first time, placing India among global giants such as the US, China, Japan, and Hong Kong. India's primary market is set for a dynamic period, with 55 companies planning to raise over Rs 68,000 crore through Initial Public Offerings (IPOs). The first half of FY2025 has already seen 35 mainboard IPOs, collectively raising around Rs 32,000 crore with an average subscription rate of 61 times. The Indian market maintained a positive outlook in the first quarter of FY2025, driven by strong Q4FY24 earnings, favorable economic data, and positive global cues. Despite early June volatility following the 2024 <keyword id="19895394" type="General" weightage="20" keywordseo="lok-sabha" source="keywords">Lok Sabha</keyword> election results, market sentiment improved with the BJP securing 272 seats and a total of 292 seats for the NDA with allied support. This political stability under Prime Minister Narendra Modi's leadership is expected to promote long-term economic growth, with a focus on infrastructure, electric mobility, startup support, power distribution, digital privacy, and healthcare initiatives. Corporate India's performance in the March quarter of FY2024 met expectations, showing double-digit growth in net profit and single-digit revenue increases. Non-lending companies experienced moderate operating margin expansion due to favorable commodity prices and cost controls. The peaking interest rates and continuity of <keyword id="19978691" type="General" weightage="20" keywordseo="government-policies" source="keywords">government policies</keyword> are anticipated to support healthy corporate growth in FY2025. <h2>Growth to continue</h2>The government's push for increased <keyword id="20068449" type="General" weightage="20" keywordseo="ethanol-production" source="keywords">ethanol production</keyword> targets a 20% blending by 2026, benefiting ethanol-heavy sugar companies and promoting biofuel goals. The real estate market is projected to grow significantly, requiring Rs 14 lakh crore in debt financing from 2024 to 2026. This growth will positively impact the banking and financial sectors. Major telecom operators have raised tariffs post-election, potentially improving sector financials and paving the way for sector re-rating. Major cement players are expanding through acquisitions, with an expected 6-7% compounded growth and market dominance by the top five players by March 2025. FMCG Companies expect recovery in rural business due to factors like a normal monsoon, robust crop yields, and government measures, maintaining robust rural demand. The potential roll-out of the FAME 3 Scheme to support <keyword id="19963112" type="General" weightage="20" keywordseo="electric-vehicle-sales" source="keywords">electric vehicle sales</keyword> is anticipated, with a budgetary allocation of around Rs 10,000 crore. Sectors such as auto, cement, defence, railways, consumer durables, energy, and banking are expected to outperform. Lagging sectors like IT and specialty chemicals offer value-buying opportunities at lower levels. The structural bull market for Indian equity is supported by strong domestic fundamentals and government reforms, with a positive medium- to long-term market outlook. Globally, the US market showed resilience, except for the Dow Jones. The Federal Reserve maintained interest rates at 5.25-5.50%, awaiting inflation to move towards the 2% target before considering rate cuts. The US GDP grew at 1.4% annually in Q1 2024, with mixed economic indicators highlighting both strengths and challenges. The Indian <keyword id="19926041" type="General" weightage="20" keywordseo="IPO-market" source="keywords">IPO market</keyword> has seen significant growth, with a surge in companies seeking to list shares and a rise in capital raised. The first half of 2025 saw strong retail investor participation, reflecting confidence in India's growth prospects. Mahavir Lunawat, Managing Director, Pantomath Capital Advisors Private Limited, said, "Favourable market conditions, high liquidity, a conducive growth environment with stable interest rates, and benign inflation have facilitated a boom in the IPO market. The IPO market will experience a stronger pull post-budget. India is set to become the new equity funding frontier for global corporations." He further added. "We are on the brink of sustained, long-term momentum in the IPO market, with this year potentially becoming the best for IPOs. India's solid macroeconomic environment and promising growth prospects create an ideal backdrop for this vibrant IPO market. Additionally, there is robust participation from both domestic institutional investors and retail investors." With the Indian government's potential capex increase and the robust primary market activity, the <keyword id="19948184" type="General" weightage="100" keywordseo="Indian-economy" source="keywords">Indian economy</keyword> is poised for sustained growth. The upcoming period is expected to see heightened market activity, further IPOs, and economic stability, creating a conducive environment for investment and development.

India may boost FY25 capex by 8-10% amid surging revenues and record RBI surplus, says Market Kaleidoscope report

Donald <keyword id="19906203" type="General" weightage="20" keywordseo="Trump" source="keywords">Trump</keyword> and <keyword id="19903807" type="General" weightage="100" keywordseo="Elon-Musk" source="keywords">Elon Musk</keyword> have apparently become great friends over recent months. Musk poured millions of dollars into Trump's successful election campaign and has been a vocal and visible supporter of the president-elect. In return, he's been given a new job, in joint charge of the new <keyword id="23593857" type="General" weightage="20" keywordseo="Department-of-Government-Efficiency" source="keywords">Department of Government Efficiency</keyword> (Doge), where he will be tasked with streamlining government operations and reducing bureaucracy. This "department"—actually an advisory group—will aim to cut unnecessary spending and make the general functioning of the US government more efficient. The idea is that within a federal budget of over US$6 trillion, there are opportunities to make some big savings. Musk's appointment—like many things he's involved with—has sparked controversy. The richest man in the world has already said he wants to cut spending by US$2 trillion (£1.6 trillion) and mentioned setting up a "leaderboard for most insanely dumb spending of your tax dollars.". Some are concerned about the impact he could have on public services. Others fear he will use his position to promote his own business interests. On the positive side, Musk has a very impressive CV when it comes to big organisations. He has created (or co-created) multi-billion-dollar businesses, including Paypal, <keyword id="19895433" type="General" weightage="20" keywordseo="Tesla" source="keywords" meta.keywordsubtype="org" meta.entityname="Tesla" meta.hostid="261" meta.entityid="Tesla">Tesla</keyword>, and <keyword id="19905255" type="General" weightage="20" keywordseo="SpaceX" source="keywords" meta.keywordsubtype="org" meta.entityname="SpaceX" meta.hostid="261" meta.entityid="SpaceX">SpaceX</keyword>. He has founded startups involved in AI (xAI), tunnelling (the Boring Company), and medicine (<keyword id="19985233" type="General" weightage="20" keywordseo="Neuralink" source="keywords" meta.keywordsubtype="org" meta.entityname="Neuralink" meta.hostid="261" meta.entityid="Neuralink">Neuralink</keyword>). And research suggests that much of Musk's success comes down to a relentless focus on efficiency. He has also been praised for the depth of his analytical thinking and innovative problem solving. Tesla's factory in California went from being the least productive car manufacturing plant in the US when it was owned by General Motors to the most productive under Musk's ownership. SpaceX has vastly reduced costs in the space cargo business. So he has form. And Musk is not the first American business leader to offer private sector expertise to the world of politics. Back in the 1960s, Robert McNamara, former president of the Ford Motor Company, served as secretary of defence under presidents John F. Kennedy and Lyndon B. Johnson. McNamara brought significant innovations to <keyword id="22668770" type="General" weightage="20" keywordseo="government-efficiency" source="keywords">government efficiency</keyword> that drew on his corporate experience. He championed cost-benefit analysis and a data-driven approach to decision-making and was keen on reducing bureaucracy and promoting accountability in complex governmental processes. To achieve this, McNamara recruited a team of experts from the worlds of academia and business. Known as the "Whizz Kids," they brought new perspectives to the White House. In the UK now, the Labour government's minister of state for investment is Poppy Gustafsson, a former venture capitalist and tech founder. Its minister for prisons is James Timpson, former CEO of the Timpson Group, a family firm renowned for hiring ex-offenders. These people—and there are many other examples around the world—were brought into the political sphere because of the knowledge and vision they have demonstrated in the private sector. The hope is their talent and leadership will improve policy and practice. <h2>Data-driven reform</h2>The same must be hoped for Musk: that with his co-leader, Vivek Ramaswamy—a biotech entrepreneur and former Republican leadership candidate—he will bring expertise in cost-cutting and innovative strategies. This will probably include comprehensive audits and data-driven approaches to reform. Critics refer to prior examples of Musk's approach, such as the mass layoffs and aggressive cost-cutting measures at Twitter (now X), with concerns that there could be similarly drastic reductions in the federal workforce and public services. But big job cuts were happening across the tech sector at that time. They came in the wake of reduced revenues and a need to reduce bloated workforces and ineffective functions—not unlike the challenges faced by the US government. Nevertheless, while proponents see Musk as an experienced leader capable of streamlining bureaucracy, sceptics fear the advent of harmful austerity measures that risk disruption to essential public programs. Concerns have also been raised about potential conflicts of interest, as Musk's business empire benefits from government contracts. However, since Doge will operate as an advisory body, concerns over him gaining advantage through any self-dealing seem overblown. Besides, two of Musk's companies (SpaceX and Tesla) have been awarded US$15.4 billion (£12.3bn) in federal contracts in the last decade. Perhaps then, success precedes influence rather than the reverse? Doge will also be governed by the Federal Advisory Committee Act, which maintains legal and ethical guardrails. And Congress will have the final say over any decisions. Fears of the worst possible outcome to Musk's appointment are a natural human response in the face of uncertainty. It is part of the reason that negative headlines get more clicks than positive ones. It is also true that Musk has aligned himself with a politician who divides opinion like few others. By leveraging his billions of dollars and 200 million followers on X to help Trump to victory, he made it clear which side he was on. And in a highly polarised US political landscape, the anguish about his governmental role may be little more than a knee-jerk reaction from the millions of people whose side he did not choose.

Love him or loathe him, Elon Musk is a champion of efficiency and could save the US government a fortune

Mumbai: The Reserve Bank is unlikely to cut the benchmark <keyword id="20071327" type="General" weightage="20" keywordseo="interest-rate" source="keywords">interest rate</keyword> in its forthcoming bi-monthly monetary policy review later in the week as <keyword id="19999652" type="General" weightage="20" keywordseo="retail-inflation" source="keywords">retail inflation</keyword> is still a cause of concern, and there is a possibility of the Middle East crisis deteriorating further, impacting crude oil and commodity prices, say experts. Earlier this month, the government reconstituted the Reserve Bank's rate-setting panel -- <keyword id="19913109" type="General" weightage="20" keywordseo="Monetary-Policy-Committee" source="keywords">Monetary Policy Committee</keyword> (MPC). The reconstituted panel, with three newly appointed external members, will commence its maiden meeting on Monday. MPC Chairman RBI Governor Shaktikanta Das will reveal the outcome of the three-day discussion on Wednesday (October 9). The <keyword id="19899810" type="General" weightage="100" keywordseo="Reserve-Bank-of-India" source="keywords" meta.keywordsubtype="org" meta.entityname="Reserve Bank of India" meta.hostid="261" meta.entityid="Reserve Bank of India">Reserve Bank of India</keyword> (RBI) has kept the repo or short-term lending rate unchanged at 6.5 per cent since February 2023, and experts think some easing could only be possible in December. The government has tasked the central bank to ensure that Consumer Price Index (CPI) based retail inflation remains at 4 per cent with a margin of 2 per cent on either side. In the current context, experts feel that the RBI may not follow the US Federal Reserve, which lowered the benchmark rates by 50 basis points, and the central banks of some developed nations, which have reduced the interest rates. "We do not expect any change in the <keyword id="20094323" type="General" weightage="20" keywordseo="repo-rate" source="keywords">repo rate</keyword> or stance by MPC. The reason is that inflation for September and October will be above 5 per cent, and the present low inflation is due to the base effect. Besides, core inflation is inching upwards," said Madan Sabnavis, Chief Economist, Bank of Baroda. Further, the recent Iran-Israel imbroglio can intensify, and there is uncertainty here, he said. "Hence, the status quo is the most likely option even for new members. Inflation forecast may be lowered by 10-20 bps and no change in GDP forecast likely," said Sabnavis. The central bank last hiked the repo rate to 6.5 per cent in February 2023 and since then, it has held the rate at the same level. Icra Chief Economist Aditi Nayar said that given the undershooting in the initial first quarter GDP growth relative to the MPC's forecast and the likely sizeable undershooting in the second quarter CPI inflation print as well, "we believe a stance change to neutral may be appropriate in the October 2024 policy review". This could be followed by a shallow rate-cutting cycle of 25 bps each in December 2024 and February 2025, she added. "The abundant monsoon offers some insurance for crop inflation. The impact of global political developments and geopolitical uncertainty on the growth inflation dynamics remains a risk," Nayar added. An HSBC report said three developments stand out -- softer growth numbers have trickled in recently, inflation has been falling, and the external environment has moved from rate hikes to cuts. "We believe the RBI doesn't gain from waiting any longer. We think it will change its stance from a hawkish 'withdrawal of accommodation' to 'neutral' in the upcoming 9 October policy meeting, followed by repo rate cuts of 25 bps each in the December and February meetings, taking the repo rate to 6 per cent," the report said. The RBI kept the repo rate unchanged at 6.5 per cent in its August bi-monthly review amid risks from higher food inflation. This was the ninth consecutive MPC meeting, which decided to maintain the status quo on the rate front. Pradeep Aggarwal, founder and chairman, Signature Global (India) Limited, said while the real estate industry, developer community, and homebuyers are hoping for an interest rate cut in the upcoming monetary policy review, the RBI is likely to hold on to the interest rate cuts for the tenth consecutive time. "The apex bank still seems uncomfortable with the overall retail inflation scenario, particularly food inflation. As such, it is expected to maintain the status quo. The recent interest rate cut by the US Federal Reserve has ignited similar hopes even in India, but the domestic scenario is very different," he added. SBM Bank India Head Treasury Mandar Pitale believed that the MPC has persistently advocated a restrictive policy until inflation aligns durably towards the 4 per cent target. "With the unfavourable base effect taking the next couple of CPI prints near 5 per cent plus or minus, it will pose a major challenge for MPC to start easing from the October meeting," Pitale said, adding that the MPC is also expected to deliberate upon the global factors like growth-inflation behaviour in developed economies. The government has appointed Ram Singh, Saugata Bhattacharya, and Nagesh Kumar as external members of the MPC. They have replaced Ashima Goyal, Shashanka Bhide, and Jayanth R Varma. Apart from the Governor, the other internal members are the RBI Deputy Governor in charge of monetary policy Michael Debabrata Patra and the Executive Director monetary policy department of RBI Rajiv Ranjan. In an off-cycle meeting in May 2022, the MPC raised the policy rate by 40 basis points and it was followed by rate hikes of varying sizes, in the subsequent meetings till February 2023. The repo rate was raised by 250 basis points cumulatively between May 2022 and February 2023.

Status-quo on interest rate likely, say experts ahead of RBI's policy review

<ul class="summary-list"><li>The Department of Government Efficiency wouldn't be a department, but an outside advisory group.</li><li>Under current law, Congress needs to approve most budget changes, limiting the DOGE's power.</li></ul>President-elect Donald Trump on Wednesday announced a new effort to slash what he sees as federal inefficiency, with Elon Musk as cost-cutter-in-chief.Trump <a target="_blank" href="https://www.businessinsider.com/elon-musk-trump-cabinet-election-x-2024-9">made good on a campaign promise</a> when he tapped Musk to co-lead the proposed "Department of Government Efficiency," or DOGE, alongside former GOP presidential candidate Vivek Ramaswamy.Musk says he wants to cut $2 trillion from the federal budget to make it more efficient and effective. Beyond that, though, little is known about how the DOGE will function and how much power it — <a target="_blank" href="https://www.businessinsider.com/trump-adopts-elon-musk-plan-cut-government-spending-efficiency-reform-2024-9">and Musk</a> — will have.Musk did not respond to Business Insider's request for comment for this article. A representative for Ramaswamy declined to comment.<h2 id="2dc0c03e-9977-4403-9201-3d55e844524d">What do we know about the DOGE?</h2>Despite its name, the DOGE will <a target="_blank" href="https://www.businessinsider.com/elon-musks-doge-gets-a-government-checkmark-on-x-2024-11">not actually be a government department</a>, as departments are permanent and can only be created by Congress. Instead, it will function "outside of the government" and disband by July 4, 2026, Trump said in a statement.<div type="image" title="Trump and Musk at a rally" height="2584" width="4184" msid="115360794" hostid="261" sizebytes="161264"></div>The name DOGE is an homage to Musk's preferred cryptocurrency, Dogecoin, which shot up in value after Trump won the election. Under current law, the DOGE might not be able to accomplish much, since Congress controls federal spending."They have no power. No power at all," Elaine Kamarck, a senior fellow at the nonpartisan Brookings Institute who led efforts to reform the federal government under former President Bill Clinton, told Business Insider. "They do make recommendations, and once they make recommendations, the expectation is that the government will act on them."There's no guarantee that a recommendation will turn into a policy, especially given that many of the DOGE's suggestions will likely require congressional approval, Kamarck said.<h2 id="0f11a880-6c1f-4025-a722-a860ae33d16c">The DOGE's $2 trillion goal is something of a pipe dream.</h2>Federal spending <a target="_blank" href="https://www.businessinsider.com/trump-elon-musk-vivek-ramaswamy-department-government-efficiency-doge-2024-11">reached $6.75 trillion in 2024</a>. Multiple experts told BI that it's unlikely Musk will be able to cut his desired $2 trillion without sacrificing programs that have wide bipartisan support or fall under federal mandatory spending, like Medicare and Social Security. Kamarck called the $2 trillion goal the "most unrealistic" part of the whole DOGE plan.Trump has long been preoccupied with cutting what he sees as Washington's waste and fraud."The Department of Government Efficiency (DOGE) will ultimately be staffed and dedicated to this mission," Brian Hughes, a spokesperson for Trump's transition team, told BI in a statement.Quoting former Rep. Barney Frank, Kamarck said that excess federal spending is "marbled" <a target="_blank" href="https://www.businessinsider.com/elon-musk-vivek-ramaswamy-doge-government-efficiency-what-us-spends-2024-11">throughout the budget</a>, like fat throughout a steak, making the DOGE's desired $2 trillion in cuts tricky."It just doesn't work, unless you decide to start cutting Social Security benefits or Medicare, at which point all hell breaks loose," she told BI. "And you know, the bromance between Trump and Musk will end very quickly."Known for <a target="_blank" href="https://www.businessinsider.com/elon-musk-efficiency-companies-tesla-spacex-x-2024-11">streamlining efficiency at his companies</a>, Musk says he wants to cut bureaucracy, shrink the federal workforce, and trim the number of federal agencies down to no more than 99 (there are currently <a target="_blank" href="https://www.federalregister.gov/agencies">more than 440</a>).Douglas Holtz-Eakin, the former director of the Congressional Budget Office, told BI that he doubted that the loosely defined group would be able to accomplish much given its sprawling $2 trillion target."It is hard for me to get seriously ginned up about it until there's a real structure there that suggests that this makes some sense and has a purpose," he said. "If something is designed to do everything, it will do nothing."<h2 id="6bcaf431-1be5-4839-9b83-d0f24a7146cf">The DOGE will exist "outside of government."</h2>In one scenario, the DOGE could function as an advisory committee, which Trump can create through an executive order. The president-elect said the DOGE will work with the Office of Management and Budget, which prepares the president's budget request for Congress."They have made clear that this is a non-governmental department, which is not a familiar term, and so it's not really clear how the organization will operate because of that," Lisa Gilbert, co-president of the progressive nonprofit advocacy group Public Citizen, told BI. "It might be an advisory committee of non-governmental actors, but even from that posture, it won't have the authority to alter budgets or fire employees or rescind regulations."<div type="image" title="Donald Trump and Elon Musk" height="1910" width="2707" msid="115360796" hostid="261" sizebytes="118134"></div>Kamarck said that there are specific rules laying out how much interaction external committees can have with the government, but it's not clear how Trump, Musk, and Ramaswamy envision the <a target="_blank" href="https://www.businessinsider.com/elon-musk-doge-hiring-staff-how-to-apply-2024-11">internal infrastructure of the DOGE</a>."How are they going to talk to each other? How are they going to meet with each other? Are they going to go talk to anybody in the government, or are they just going to make up things from 50 miles away?" she said.On November 14, the DOGE <a target="_blank" href="https://x.com/DOGE/status/1857076831104434289">said in a post on X</a> that it is seeking "super high-IQ small-government revolutionaries willing to work 80+ per week on unglamorous cost-cutting." Musk said on his <a target="_blank" href="https://x.com/elonmusk/status/1857112441529700671">personal X account</a> that the positions will not be paid.<h2 id="4c25da3e-39de-44e2-a1c5-c7249f9fc728">Trump has talked about changing a key law that limits his federal spending power.</h2>Trump, Musk, and Ramaswamy may try to circumvent the congressional obstacles standing in the way of their cost-cutting agenda. Last year, Trump expressed interest in going after the Impoundment Control Act, a 1974 provision that requires the president spend funds that Congress has appropriated."Bringing back Impoundment will give us a crucial tool with which to obliterate the Deep State, Drain the Swamp, and starve the Warmongers," the president-elect <a target="_blank" href="https://www.donaldjtrump.com/agenda47/agenda47-using-impoundment-to-cut-waste-stop-inflation-and-crush-the-deep-state">said in a video</a> in June 2023.Holtz-Eakin said attempting to skirt the impoundment act would be like rewriting history, and Kamarck told BI that any attempt to not spend money that Congress has appropriated poses big Constitutional questions."If he tries to change the law so that he can impound funds, my guess is there'll be a fight in the Congress and he'll lose," she said.<h2 id="4956dc95-91da-4028-b1b3-d843a1509397">Musk could bump up against many conflicts of interest but likely wouldn't have to divest from his companies.</h2>If the DOGE is a federal advisory committee, Musk and Ramaswamy would likely be "special government employees," who are experts or consultants that can work for a federal agency or the White House for up to 130 days. They do not get paid and, crucially, would not have to divest from their companies."They've been clear also that they're staying in their roles as the heads of companies and in other places," Gilbert said. "Not being a part of government means they don't have to deconflict themselves."In a press release for Public Citizen, Gilbert said that Musk's "own businesses have regularly run afoul of the very rules he will be in position to attack" as the DOGE co-lead.<div type="image" title="Donald Trump and Vivek Ramaswamy" height="5504" width="8256" msid="115360795" hostid="261" sizebytes="4296554"></div>In the role, Musk and Ramaswamy would still be bound to federal ethics laws and have to recuse themselves from conversations that affect them personally, <a target="_blank" href="https://www.bloomberg.com/news/articles/2024-11-14/doge-what-can-musk-do-with-the-department-of-government-efficiency?srnd=homepage-americas">Bloomberg</a> reported. With his companies under investigation from at least 20 federal regulatory agencies and SpaceX having more than $15 billion in federal contracts, Musk could face many such conflicts.Kamarck said that there's no "firm line" about when employees need to take themselves out of discussions, but that lawyers address questions on a case-by-case basis.Musk has expressed public frustration with what he views as overbearing federal oversight, which he said has <a target="_blank" href="https://www.nytimes.com/2024/11/12/us/politics/elon-musk-vivek-ramaswamy-trump.html">slowed down his pace of business</a>.By law, meetings of advisory committees, like the kind the DOGE could be, need to be open, and Musk has no problem with the <a target="_blank" href="https://www.businessinsider.com/elon-musk-doge-leaderboard-federal-government-spending-trump-2024-11">transparency</a> — in fact, he seems to invite it. In a post on X, the billionaire promised to post all of the group's actions online <a target="_blank" href="https://www.businessinsider.com/elon-musk-leaderboard-government-spending-marketing-genius-doge-donald-trump-2024-11">"for maximum transparency</a>" and said the public should chime in with their opinions.It's also possible the group might intentionally avoid becoming a federal committee because of the increased oversight and scrutiny, Holtz-Eakin said."It's not a federal committee as far as I can tell," he said. "I think that's deliberate. If you do that, then you're subject to lots of things like a conflict of interest you have to sign off on, and I think that would be a nightmare for Mr. Musk. And so they're not going to let it tiptoe toward federal jurisdiction."Until Trump actually forms the DOGE, if he ever does, the legal and bureaucratic details remain murky, and the experts BI spoke with aren't convinced that it will work well."It sounds a little screwy, frankly," Kamarck said.

How Elon Musk's Department of Government Efficiency could actually work

The Karnataka government is considering proposals to allow tents and <keyword id="21356640" type="General" weightage="20" keywordseo="alcohol-sales" source="keywords">alcohol sales</keyword> on the state's beaches, similar to <keyword id="19895061" type="General" weightage="20" keywordseo="Goa" source="keywords">Goa</keyword>, in an effort to boost tourism. Speaking at the 'Connect 2024' event in <keyword id="19936741" type="General" weightage="20" keywordseo="Mangalore" source="keywords">Mangalore</keyword> on Wednesday, Rajendra K V, tourism department's director, emphasised that changes are necessary to attract tourists. "We need to relax restrictions on alcohol consumption along the beaches of Karnataka, which may bring more influx of tourists just like in the state of Goa," he added. According to him, to enhance safety and encourage people to spend more time at the beaches during the night, the department is contemplating the installation of additional lights along the coast. District officials have been instructed to identify government and private lands near beaches to promote <keyword id="23668481" type="General" weightage="20" keywordseo="tent-tourism" source="keywords">tent tourism</keyword> in the state. Rajendra also revealed that a facilitation centre would soon be established to expedite approvals for tourism projects, including CRZ (<keyword id="20495401" type="General" weightage="20" keywordseo="Coastal-Regulation-Zone" source="keywords">Coastal Regulation Zone</keyword>) permissions. He added that the new <keyword id="20021259" type="General" weightage="20" keywordseo="tourism-policy" source="keywords">tourism policy</keyword> will include specific guidelines for coastal tourism. Deputy Commissioner of Dakshina Kannada, Mullai Muhilan, said tourists should be allowed access to beaches late at night. "Restaurant and licensed business operating hours in Mangalore city have already been extended to 1 am and the same should apply to the beaches as well," he added. He further stated that discussions would be held with the police department to resolve issues regarding the current restrictions on <keyword id="22266283" type="General" weightage="20" keywordseo="beach-access" source="keywords">beach access</keyword> after 9 pm and appropriate action would be taken.

Karnataka to go Goa way and allow alcohol sales in coastal cities to lure tourists

<ul class="summary-list"><li>Republicans are projected to maintain their majority in the House of Representatives.</li><li>That means Trump is set to have a trifecta, as he did in the first half of his first term.</li></ul>After more than a week counting outstanding ballots across several states, Republicans are officially projected to maintain control of the House of Representatives.According to projections from NBC and CNN, Republicans will win at least 218 House seats, enough to claim the majority. Several races still remain undecided, with ballots continuing to be counted. The GOP currently holds a 220-seat majority.Democrats picked up GOP-held seats in New York, Oregon, California, Louisiana, and Alabama, while Republicans flipped Democratic-held seats in Pennsylvania, Michigan, and North Carolina.The GOP also <a target="_blank" class="" href="https://www.businessinsider.com/republicans-win-senate-election-majority-election-2024-11">retook control</a> of the Senate, meaning President-elect Donald Trump will enjoy a governing trifecta for at least the next two years, as he did during the first two years of his first term.As a result of the GOP keeping the House, Trump will <a target="_blank" class="" href="https://www.businessinsider.com/congress-balance-of-power-results-competitive-republicans-democrats-2024-11">avoid the resistance</a> he encountered from a Democratic-led House during the last two years of his first term. Furthermore, he'll be dealing with a <a target="_blank" class="" href="https://www.businessinsider.com/trump-republican-party-more-compliant-this-time-2024-11">far more obedient GOP</a> than existed during the first two years — after several successive election cycles, the party has largely been remade in Trump's image.Congress is particularly important for Trump when it comes to<a target="_blank" class="" href="https://www.businessinsider.com/tax-cut-tariff-plan-outlook-presidential-election-scenarios-harris-trump-2024-10"> tax policy</a>. Many of his other policy goals can be accomplished via executive orders, but the incoming president will need congressional action to exempt tips, overtime pay, and Social Security benefits from taxation, as he's promised.About three dozen House races were considered to be competitive, ranging from Republican-held swing districts in traditionally Democratic states like New York and California to <a target="_blank" class="" href="https://www.businessinsider.com/david-schweikert-profile-trump-realignment-arizona-economic-interests-abortion-2024-10">suburban districts</a> across the country where Democrats have made inroads in recent election cycles.It took far longer to determine who controls the House than the Senate or White House in large part due to the slow counting of mail-in ballots in Arizona and California.Both House Speaker <a target="_blank" class="" href="https://www.businessinsider.com/who-is-mike-johnson-republican-speaker-house-louisiana-2023-10">Mike Johnson</a> and House Minority Leader <a target="_blank" class="" href="https://www.businessinsider.com/hakeem-jeffries-early-honeymoon-house-democrats-tension-progressives-2023-5">Hakeem Jeffries</a> are expected to remain in their respective roles, with internal leadership elections set to take place later this month.

Republicans keep the House, handing Trump a trifecta of government control

Last week, Donald Trump announced the creation of the <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk-department-of-government-efficiency-donald-trump-ramaswamy-2024-11">Department of Government Efficiency</a>, which promises to "dismantle government bureaucracy, slash excess regulations, cut wasteful expenditures, and restructure Federal Agencies." And to run the new cost-cutting department, Trump tapped the businessman he calls the world's "greatest cutter" — <a target="_blank" class="" href="https://www.businessinsider.com/gop-senator-waste-list-influence-elon-musk-spending-cuts-2024-11">Elon Musk</a>.If you're looking to take a chainsaw to the federal government, Musk seems perfectly suited to the job. At <a target="_blank" class="" href="https://www.businessinsider.com/twitter-x-elon-musk-startup-competitition-town-square-election-2024-10">Twitter,</a> he eliminated a staggering 80% of the staff — over 6,000 people. At <a target="_blank" class="" href="https://www.businessinsider.com/tesla-salary-database-elon-musk-pay-strategy-2024-11">Tesla</a>, he cut 10% of the workforce, saying the company needed to be "absolutely hardcore about headcount and cost reduction." He also laid off 10% of employees at <a target="_blank" class="" href="https://www.businessinsider.com/spacex-jared-isaacman-interview-polaris-dawn-space-walk-2024-11">Space X</a>, insisting his teams need to be scrappy and nimble. Cutting, for Musk, is generally Job No. 1.For the most part, Musk's slash-and-burn tactics have paid off. Twitter usage, according to Musk, is at an all-time high. Tesla's stock is up 28% over the past year. And SpaceX — now valued at $250 billion — is grabbing rockets out of the sky with <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk-spacex-starship-landing-super-heavy-2024-10">giant chopsticks</a>. In the world of business, fewer workers often translate into higher profits.The question is: Can the cost-cutting tactics Musk has employed in the private sector work to corral waste and bloat in the federal government? Musk and his DOGE cochair, the biotech billionaire <a target="_blank" class="" href="https://www.businessinsider.com/why-elon-musk-cutting-federal-spending-could-work-2024-11">Vivek Ramaswamy</a>, have said they're looking to hire "super high-IQ small government revolutionaries" to help make $2 trillion in cuts — about a third of all federal spending — and to slash the federal workforce by as much as 75%. It's a dream that has eluded every Republican administration since Ronald Reagan — and it's one that may prove elusive even for Musk, the man now anointed as America's cost-cutter in chief.There's certainly no shortage of waste and inefficiency in the federal government that cries out to be streamlined. In 2019, the Defense Department forked over $22 million for lobster tails. In 2020, the IRS sent $1.4 billion in tax refunds to dead Americans. Millions of square feet in federal buildings sit unoccupied.In theory, a bold, outside figure like <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk-donald-trump-elected-shadow-president-2024-11">Musk</a> could be the very thing needed to downscale an operation as vast and intractable as the federal government. Large organizations need a force of "creative destruction" to change, says Michael Morris, a professor at Columbia Business School. "Things don't go away on their own. You have to have somebody with a willingness to deliberately dismantle things if you're going to have innovation." And when a new figure institutes a massive shock to the system — whether at the government or private level — "it often backfires," says Morris. "There's often very fierce, active resistance to change." As <a target="_blank" class="" href="https://www.businessinsider.com/joe-biden-corporate-gerontocracy-aging-ceos-retirement-succession-replacement-2024-8">CEO</a>, Musk has the latitude to push past that resistance and overhaul company culture. But things are going to be different with DOGE. Despite its branding as a "department," the new outfit will operate only in an advisory capacity: Congress holds the ultimate responsibility for authorizing spending and <a target="_blank" class="" href="https://www.businessinsider.com/doge-how-to-apply-dm-job-application-elon-musk-2024-11">eliminating agencies</a>. Government, by design, is an intensely collaborative process, intended to hammer out the competing needs of different constituencies. Musk, by contrast, is accustomed to ruling by fiat."Musk certainly exercises a great deal of control in his companies that he won't have in the environment of the federal government, where we have checks and balances," says Andy Wu, an associate professor of business administration at Harvard Business School. "Even if Musk had the right idea for things, it's not so clear he could implement any of them."The federal government is infamous for holding on to past practices, even when they no longer make sense. Linda Bilmes, a senior lecturer in public policy at the Harvard Kennedy School, cites the continued minting of the penny, each of which costs three cents to produce. Last year, in an economy that has largely moved away from cash, the government spent $179 million forging pennies and nickels. Yet past calls to get rid of the penny haven't amounted to one red cent."The danger is if Elon Musk were to somehow think he is the first person who has ever looked at cost cutting in government," says Bilmes. "Many people who know a lot about government have proposed many good ideas. The potential for usefulness would be if he could take some already reasonably good ideas and help them get implemented."The <a target="_blank" class="" href="https://www.businessinsider.com/watchdog-dod-must-speed-up-weapons-deliveries-to-maintain-advantage-2024-6">Government Accountability Office</a> and inspectors general have already recommended a variety of potential targets. They aren't always flashy: This year, the GAO recommended agencies use predictive models to schedule maintenance, saying they could save $100 million or more. It also urged the IRS to focus on collecting taxes owed by sole proprietors, which could generate hundreds of millions of dollars in revenue. If the government implemented all 5,480 of its suggestions, the GAO estimated, it would "produce measurable financial benefits" of up to $208 billion.But so far, Musk has seemed more interested in the kind of flashy, small-bore proposals that attract clicks on X. He's taken to resharing what he sees as examples of waste — everything from $3 million spent on drug research that involved watching "hamsters fight on steroids" to a $20,000 grant that funded drag shows in Ecuador — and crowdsourcing them on the platform. Those sorts of items might generate outrage on <a target="_blank" class="" href="https://www.businessinsider.com/twitter-donald-trump-elon-musk-2024-11">Fox News</a>, but eliminating them won't do much to trim the federal government's $6,200,000,000,000 in annual spending.Then there's the politics of budget cutting. The last time Republicans succeeded at slowing government spending, under <a target="_blank" class="" href="https://www.businessinsider.com/reagan-secret-service-agent-says-trump-shooting-failure-for-agency-2024-7">Ronald Reagan</a>, they made deep cuts to areas of government that proved unpopular — including social welfare programs, student loans, and job training. Musk may see plenty of areas he'd like to slash, but a wide range of constituencies will inevitably push back against cuts to programs they consider essential. When it comes to federal spending, one person's waste is another person's bread and butter."People support the idea of improving how the government delivers services," says Joel Friedman, the senior vice president for federal fiscal policy at the Center on Budget and Policy Priorities, a progressive think tank. "I think people would take a different view if you end up gutting programs they depend on and care about." Efficiency always sounds like a good thing, until it comes for something you love.Beyond the question of where to cut, Musk will face intense scrutiny over why he's targeting certain areas of government. His role at DOGE is rife with the potential for conflicts of interest. SpaceX, for example, has received nearly $20 billion in federal contracts since 2008, and Musk has been sharply critical of the Federal Aviation Administration, viewing it as an obstacle to launching his powerful <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk-trump-spacex-starship-rocket-milestone-election-2024-10">Starship</a>. And his massive investments in electric vehicles and social media are dependent on all sorts of federal spending and oversight. When it comes to how the government interacts with the marketplace, the world's richest man inherently has a lot of skin in the game. Musk's companies did not respond to requests for comment. But Brian Hughes, a spokesperson for Trump's transition team, says it plans to ensure that those involved with DOGE "are compliant with all legal guidelines related to conflicts of interest."Those concerns also touch on the larger question of what Trump and his allies hope to accomplish by reducing the size of government. Calls for reducing "inefficiency" and "bureaucracy" have long been a euphemism for Republicans eager to reduce or eliminate federal oversight of everything from industrial pollution to airline safety. Less government is not necessarily better government, and there are plenty of federal agencies that remain so understaffed and underfunded, from the IRS to the Veterans Administration, that they're unable to perform even their most basic functions. The GOP's aim of cutting spending, a leading Reagan ally once acknowledged, is to shrink government to the size where conservatives can "drag it into the bathroom and drown it in the bathtub." On Friday, Ramaswamy directly linked DOGE to the Reagan-era dream of smaller government, promising that the new agency will finish its work by July 4, 2026 — the 250th anniversary of the Declaration of Independence.And even when conservatives have succeeded at cutting costs, it's done nothing to slow the pace of government spending. Reagan slashed $22 billion in social welfare programs during his first two years in office — savings that were more than offset by his tax cuts and military spending, which nearly tripled the national debt. And in 1981, when a deep recession hit, carving up the safety net left the millions of Americans who were mired in poverty with even fewer resources to get by.It's also important to remember that Musk did more than downsize X — he also used the platform to elevate far-right talking points and unfounded conspiracy theories. In short, he reshaped it to serve his own political ends, making it meaner as well as leaner. It remains to be seen if Musk will do the same with DOGE. There are plenty of places where Uncle Sam could spend America's hard-earned tax dollars more wisely. But there are also plenty of places where the man Trump's family now refers to as "Uncle" Elon could deploy what DOGE calls "unglamorous cost-cutting" to bend the federal government to serve his own financial needs.Musk has acknowledged that Americans will feel "hardship" as a result of the cuts he wants to see implemented. But that doesn't mean he won't be able to juice more performance out of fewer resources, as he did at his own companies. When Musk slashed the workforce at Twitter, critics predicted that the app would collapse without enough staff to maintain it. Two years later, after a few initial glitches, it works much the same as before — at a far lower cost. Doubting Musk, even when he seems to be operating at his most extreme, can be a fool's game.<a target="_blank" rel="" class="" href="https://www.businessinsider.com/author/amanda-hoover">Amanda Hoover</a> is a senior correspondent at Business Insider covering the tech industry. She writes about the biggest tech companies and trends.

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