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India’s Chief Economic Advisor (CEA), <keyword id="20690607" type="General" weightage="20" keywordseo="V-Anantha-Nageswaran" source="keywords">V Anantha Nageswaran</keyword>, remains optimistic about the nation’s economic prospects despite a slower-than-expected <keyword id="19972825" type="General" weightage="20" keywordseo="GDP-growth" source="keywords">GDP growth</keyword> in the second quarter of FY2024-25. Speaking at the Bharat @100 Summit hosted by Assocham, he said that the fundamental health of the economy remains robust, according to a report by aNI. Nageswaran highlighted several indicators demonstrating the economy’s resilience. “If you run through the checklist for the <keyword id="19948184" type="General" weightage="100" keywordseo="Indian-economy" source="keywords">Indian economy</keyword>, the health is pretty robust,” he noted, pointing to controlled levels of external debt as a share of GDP, declining non-performing assets in the banking system, and stable inflation trends. Although certain food items have caused inflationary spikes, their impact is limited within the overall consumer price index basket, he explained. The CEA praised the shift in fiscal expenditure priorities over the past seven years, with greater focus on capital investments rather than revenue spending. This reallocation, he suggested, has bolstered long-term economic stability and growth potential. India’s GDP growth for the July-September quarter was 5.4%, significantly below the Reserve Bank of India’s forecast of 7%. While this has sparked concerns among economists, Nageswaran urged against overreacting. Erratic monsoons and excessive rainfall disrupted economic activity in Q2, he explained, while global uncertainties and supply chain pressures further weighed on growth. Despite these challenges, he maintained confidence in the broader growth narrative, citing improvements in key economic metrics. For instance, India’s gross capital formation has risen from 27.3% of GDP in the second decade of the 2000s to 30.8% today. Private consumption remains steady, and exports—spanning both services and manufacturing—continue to perform well even amid challenging global conditions. Nageswaran also underscored India’s growing competitiveness in international trade. He noted that the nation’s total <keyword id="24325087" type="General" weightage="20" keywordseo="exports-as-a-percentage-of-GDP" source="keywords">exports as a percentage of GDP</keyword> now surpass China’s, showcasing its resilience and adaptability in a shifting global trade environment. However, he cautioned against reading too much into quarterly fluctuations, highlighting the impact of geopolitical developments such as trade restrictions from the US on critical minerals and rare earths, as well as policy shifts in China. These external factors, he suggested, are likely to persist and may continue influencing short-term economic trends. (with ANI inputs)

Indian economy is resilient despite Q2 challenges, says CEA Nageswaran

Union Finance Minister <keyword id="19916618" type="General" weightage="100" keywordseo="Nirmala-Sitharaman" source="keywords">Nirmala Sitharaman</keyword> highlighted India's significant progress in electrification, <keyword id="23692737" type="General" weightage="20" keywordseo="water-accessibility" source="keywords">water accessibility</keyword>, and <keyword id="20879840" type="General" weightage="20" keywordseo="economic-empowerment" source="keywords">economic empowerment</keyword> during a fireside chat with John J Hamre, President and CEO of the Center for Strategic and International Studies (CSIS), in Washington, DC. Highlighting the progress made in <keyword id="23003732" type="General" weightage="20" keywordseo="rural-electrification" source="keywords">rural electrification</keyword>, <keyword id="19916494" type="General" weightage="20" keywordseo="sitharaman" source="keywords">Sitharaman</keyword> highlighted that every village in India now has access to electricity. She noted that in 2014, many villages across India, including those near state capitals, lacked even basic infrastructure for electrification. She said "I don't think any village in India is unelectrified today. Households have received the connections. So, if I remember the situation in 2014, there were still many villages in many parts of India, some even very close to the state capital, provincial headquarters, without even a pole to receive the electric wires. Now, all that has been overcome. Houses have got their electricity." The Finance Minister also discussed the <keyword id="19971121" type="General" weightage="20" keywordseo="Jal-Jeevan-Mission" source="keywords">Jal Jeevan Mission</keyword>, a program initiated by Prime Minister Narendra Modi to provide tap water connections to every household. She explained, "Earlier, one tap water connection was provided to a village, from where everyone would take water to their home. But under the 'Jal Jeevan Mission,' each and every house gets a tap water connection." Sitharaman emphasized the positive impact of this initiative on health, sanitation, and convenience for millions of Indian families. Turning to the economic empowerment of <keyword id="20101496" type="General" weightage="20" keywordseo="municipalities" source="keywords">municipalities</keyword> and urban centers, Sitharaman noted that these local governments are receiving increased autonomy and financial support. She explained that municipalities receive a portion of taxes collected by the central government, along with additional funds based on the Finance Commission's recommendations. "Over and above, today, we are enhancing their capacities to raise resources from the market. Municipalities are a very powerful instrument of economic development and they, on their own, are raising a lot of resources," she added. Sitharaman also expressed confidence in India's economic growth and its appeal to <keyword id="20632552" type="General" weightage="20" keywordseo="global-investors" source="keywords">global investors</keyword>. "The policies are working, reforms are happening, and they shall continue to happen," she stated, adding that "greater liberalisation of the economy will be there and, in a way, we are accessing newer markets and speaking about the <keyword id="19948184" type="General" weightage="20" keywordseo="Indian-economy" source="keywords">Indian economy</keyword> in more avenues and platforms that will attract more investors." With ongoing reforms and increased global engagement, Sitharaman noted, India is solidifying its position as a significant player on the world stage, expanding its economic reach and inviting foreign investment.

No village in India left without access to electricity, claims FM Nirmala Sitharaman

Union Minister of Communications Jyotiraditya Scindia on Monday stated that <keyword id="19916120" type="General" weightage="20" keywordseo="5G" source="keywords">5G</keyword> technology is expected to inject around $450 billion into the <keyword id="19948184" type="General" weightage="20" keywordseo="Indian-economy" source="keywords">Indian economy</keyword> by 2040. The minister highlighted this during his address at the Global Standards Symposium at Bharat Mandapam in New Delhi, one of the world's largest telecom events. He said, "In India alone, for example, 5G is anticipated to inject an astounding 450 billion dollars into the economy by 2040." The minister emphasized that 5G is not just about faster internet or low latency, but is laying the groundwork for <keyword id="20006420" type="General" weightage="20" keywordseo="smart-cities" source="keywords">smart cities</keyword>, advanced infrastructure, and autonomous innovations. Scindia further noted that 5G has already been rolled out across all 36 states and Union Territories, covering 98 per cent of districts and 80 per cent of the population in just 22 months. He said this achievement showcases not only India's technological prowess but also the transformative power of standardized innovation. He added "We are unlocking new Reims of possibility in health care, education and agriculture and Manufacturer" The minister stressed the importance of international collaboration in unlocking the full potential of technologies like 5G, <keyword id="19904566" type="General" weightage="20" keywordseo="artificial-intelligence" source="keywords">artificial intelligence</keyword> (AI), and the Internet of Things (IoT). He stated that the global standards are key to ensuring that these technologies work harmoniously across borders. "The import of dialogue cannot be overstated. The wonders of 5G the brilliance of artificial intelligence and the interconnected marvels of the Internet of Things. Things are transforming industries, societies and manufacturing processes and economies on a global scale," he said. Scindia also pointed out the need for robust governance in emerging technologies like AI and IoT, emphasizing the importance of ethical considerations and regulatory frameworks to address concerns around privacy, bias, and transparency. He called for a comprehensive policy framework to ensure that future innovations, such as the upcoming 6G technology, benefit everyone equitably and do not deepen existing digital divides. "We are today poised at the edge of a new technological era, the dawn of the 6th generation of mobile network 6G and this is a gateway to the future where communication will become boundless where innovation will know no limits and by humanity, interconnectedness becomes the corner stone of our shared global destiny" he said. Scindia also urged the global community to work together in setting standards and nurturing partnerships that will define the future technological landscape, ensuring technology serves as a force for good. SEE ALSO:<a href="https://www.businessinsider.in/business/auto/news/hyundai-ipo-review-everything-you-need-to-know-about-indias-biggest-ipo/articleshow/114203740.cms" target="_blank"></a> <a href="https://www.businessinsider.in/business/auto/news/hyundai-ipo-review-everything-you-need-to-know-about-indias-biggest-ipo/articleshow/114203740.cms" target="_blank">Hyundai IPO review – Everything you need to know about India’s biggest IPO</a><a href="https://www.businessinsider.in/business/auto/news/the-ola-electric-saga-are-surge-in-complaints-and-declining-market-share-a-wake-up-call-for-bhavish-aggarwal/articleshow/114120828.cms" target="_blank"></a> <a href="https://www.businessinsider.in/business/auto/news/the-ola-electric-saga-are-surge-in-complaints-and-declining-market-share-a-wake-up-call-for-bhavish-aggarwal/articleshow/114120828.cms" target="_blank">The Ola Electric Saga: Are surge in complaints and declining market share a wake-up call for Bhavish Aggarwal?</a><a href="https://www.businessinsider.in/tech/mobile/news/samsung-leads-the-first-phase-of-festive-sales-with-a-20-market-share/articleshow/114070723.cms" target="_blank"></a> <a href="https://www.businessinsider.in/tech/mobile/news/samsung-leads-the-first-phase-of-festive-sales-with-a-20-market-share/articleshow/114070723.cms" target="_blank">Samsung leads the first phase of festive sales with a 20% market share</a>

5G to inject $450 billion into Indian economy by 2040: Telecom Minister Scindia

<ul><li><keyword id="19920097" type="General" weightage="20" keywordseo="Karwa-Chauth" source="keywords">Karwa Chauth</keyword> is set to add ₹22,000 crore worth of business to the <keyword id="19948184" type="General" weightage="20" keywordseo="Indian-economy" source="keywords">Indian economy</keyword>.</li><li>This year's spending is expected to surpass last year's ₹15,000 crore mark.</li><li>Karwa Chauth will be celebrated across India on Sunday.</li></ul>Deeply rooted in Indian culture and spirituality, the festival of Karwa Chauth has grown into a significant economic event, with an estimated ₹22,000 crore worth of business anticipated in markets nationwide. The traditional festival will be celebrated across India on Sunday, marking a day of fasting and prayer for the well-being and longevity of spouses. This year's spending is expected to surpass last year's ₹15,000 crore mark, reflecting a surge in enthusiasm and <keyword id="23410660" type="General" weightage="20" keywordseo="consumer-activity" source="keywords">consumer activity</keyword>. Over the past week, markets across the country have witnessed a lively atmosphere, with bustling crowds shopping for clothing, jewellery, cosmetics, gift items, and puja essentials in preparation for the occasion. Delhi, one of the central hubs for the festivities, is expected to contribute significantly to this economic boom, with sales projected to reach approximately ₹4,000 crore. The shopping spree spans a variety of items associated with Karwa Chauth, including jewellery, traditional clothing, makeup products, sarees, and religious items like Karwa pots, sieves, lamps, wicks, and prayer books. In addition, red glass bangles, anklets, toe rings, lockets, and intricately designed Karwa thalis are among the popular items being purchased. This year, silver Karwas have also been introduced to the market, and they are expected to be in high demand. Henna (mehendi) application, considered auspicious for the festival, has also seen a surge in popularity, with markets, temples, and public places filled with women lining up to get their hands decorated. In Delhi, Connaught Place's Hanuman Temple has become a prominent spot where thousands gather for mehendi, while beauty parlours and private mehendi sessions are booked solid. Henna artists find a valuable opportunity to earn a livelihood during this period. Karwa Chauth not only boosts retail activity but also sets the stage for the upcoming <keyword id="19896655" type="General" weightage="20" keywordseo="wedding-season" source="keywords">wedding season</keyword>, with many shoppers placing orders for <keyword id="20242079" type="General" weightage="20" keywordseo="gold-jewellery" source="keywords">gold jewellery</keyword>. The wedding season, commencing in November, traditionally sees a rise in bookings for bridal jewellery, and the festival serves as an early catalyst for these purchases. With inputs from ANI. SEE ALSO: <a href="https://www.businessinsider.in/personal-finance/news/best-credit-cards-for-online-shopping-in-india/articleshow/114354358.cms">Best credit cards for online shopping this festive season</a> <a href="https://www.businessinsider.in/tech/mobile/webstories/best-smartphones-under-25000-in-india-in-october-2024/slidelist/114339207.cms">Best smartphones under ₹25,000 in India in October 2024</a> <a href="https://www.businessinsider.in/stock-market/webstories/waaree-energies-ipo-price-band-to-risk-factors-all-you-need-to-know/slidelist/114350114.cms">Waaree Energies IPO – Price band to risk factors, all you need to know</a>

Karwa Chauth festivities to boost economy by ₹22,000 crore

Reserve Bank <keyword id="20595794" type="General" weightage="20" keywordseo="Governor-Shaktikanta-Das" source="keywords">Governor Shaktikanta Das</keyword> on Thursday said the fundamental drivers of the <keyword id="6356076" type="General" weightage="100" keywordseo="indian-economy" source="Orion">Indian economy</keyword> are gaining momentum and the country is moving on a sustainable growth path. In the inaugural address at <keyword id="23048827" type="General" weightage="20" keywordseo="FIBAC-2024" source="Orion">FIBAC 2024</keyword>, the governor said that massive changes are taking shape in various economic sectors and markets, and the country is geared for orbital shifts. "Our nation's journey towards becoming an advanced <keyword id="19931030" type="General" weightage="20" keywordseo="economy" source="keywords">economy</keyword> is drawing strength from a unique blend of factors, and these factors would include a young and a dynamic population, a resilient and diverse economy, robust democracy, and a rich tradition of entrepreneurship and innovation," Das said. Stressing that India's growth story is intact and banks have robust balance sheets, he exhorted the private sector to step up investments in a big way. He said data actually shows that the fundamental growth drivers of the Indian economy are actually gaining momentum and they are not slowing. "This gives us the confidence to say that the Indian growth story remains intact," he said. In his speech, the governor said past reforms like GST and IBC have yielded long-term positive outcomes, and emphasised the need for further reforms in land, labour, and agri markets. While acknowledging that headline inflation matters, he said the balance between inflation and growth is well-poised. With monsoon progressing well and healthy Kharif sowing, food inflation outlook could become more favourable, he added. Das further said the <keyword id="20172097" type="General" weightage="20" keywordseo="financial-sector" source="keywords">financial sector</keyword> must expand access and harness digital platforms to drive inclusive growth. He also made a strong case for tailored products and services for women-led businesses and MSMEs without diluting underwriting standards. Das further noted that only regulated entities will be allowed on Unified Lending Interface (ULI) platform to ensure prudent lending. "ULI will not be a select club of few players," Das said.

Fundamental drivers of economy gaining momentum, India on sustainable growth path: RBI Governor Das

<div type="image" title="Are Indians depositing less money in banks, or more in mutual funds? Turns out, it&amp;#39;s neither of those." msid="113663806" hostid="261" sizebytes="1121785"></div> Over the past few months, there’s been a lot of brouhaha about the lagging pace of <keyword id="20202062" type="General" weightage="20" keywordseo="bank-deposits" source="keywords">bank deposits</keyword> in India. Simply put, the rate at which Indians are depositing their hard-earned money in banks has been falling constantly, and some blame the increasing financialisation of <keyword id="20751315" type="General" weightage="20" keywordseo="household-savings" source="keywords">household savings</keyword> in the country or the rising preference of Indians towards <keyword id="19929240" type="General" weightage="20" keywordseo="mutual-funds" source="keywords">mutual funds</keyword> and shares. So, the hypothesis is that people are choosing to invest more in mutual funds and the Indian <keyword id="19949641" type="General" weightage="20" keywordseo="equity-markets" source="keywords">equity markets</keyword> through direct investments, IPOs, or NFOs, the money flowing into Indian banks in the form of deposits is slowing down. But is that really the case? <h2>A crisis or a phase?</h2><keyword id="19899808" type="General" weightage="20" keywordseo="RBI" source="keywords" meta.keywordsubtype="org" meta.entityname="RBI" meta.hostid="261" meta.entityid="RBI">RBI</keyword> data suggested that for the quarter ended June 2024, bank deposits grew at 11.7%. On the other hand, credit growth has outpaced this at 15%. This means that the outflow from banks as loans is far greater than the inflow into them in the form of deposits in Q1 of FY 2024-25. The situation largely saw cut-copy-paste in the first week of September as well, with loans registering a 13.3% YoY growth during the period, while deposits rose only 11.1%. This gap has only been widening for the last 3 years. Since deposits are how banks gather assets to further lend and earn interest income as a consequence, even a slight dip could set the alarm bells ringing for banks, and rightfully so. And truth be told, mutual funds are indeed taking on bank deposits in a big way. Per a report by Franklin Templeton, in August 2024, the AUM (assets under management) of Indian mutual funds, or the total funds managed by them, stood at 31.3% of total bank deposits in the country, up from 24.20% during the year-ago period. As of August 2024, the AUM of mutual funds stood at Rs 66.17 lakh crore, an all-time high. But all said and done, is this really the reason why the rate of bank deposits is falling behind? SBI has dismissed this to be a “statistical myth”, and experts point out that since equity and fund houses also keep the cash in their respective bank accounts, there’s no cause for concern. So, is financialization really to be blamed for the trailing tempo of deposits? Or is something else happening behind the scenes? We take a closer look: <h2>First, are household deposits really slowing down? And is that a cause of concern?</h2>Data from Motilal Oswal suggests the contrary. Deposits grew by around 10.4% between March 2020 and August 2024. Data from RBI also highlights that as of August 9, 2024, bank deposits witnessed a YoY growth of 10.8%. The loan-to-deposit ratio for the retail segment, which indicates what percentage of its total deposits the banks lend out as loans, has stayed at 77.5%, above the 77% mark for the tenth straight month. <div type="image" title="Yes, household deposits (as % of total deposits) have dipped, but the drop is far from significant" msid="113663882" hostid="261" sizebytes="306706"></div> Also, we can’t forego the fact that the share of Indian households in bank deposits has indeed slowed down. However, data from Axis AMC shows that the dip is marginal—from 63% in 2022 to 62% in 2023 and 61% in 2024. What has slowed down even more considerably is the share of government deposits in the aggregate bank deposits, which has dipped from 14% in 2018 to 9% in 2024. So, it's not just household deposits, you see. Moreover, as of March 2024, the collective CASA ratio (current and <keyword id="114757" type="General" weightage="20" keywordseo="savings-account" source="Orion">savings account</keyword> deposits) of all commercial banks in India stood at 41.00%, down from 43.1% in March 2023 and 45.2% in March 2022, marking a nearly 5% point decline over the past year, while still staying over the 10-year average of 39.2%. This implies that Indian banks are relying more on higher-cost funds (savings accounts), which can limit their profitability. <h2>What is this financialisation of savings we are talking about?</h2>Then again, there is no doubt about the growing affinity of Indians towards mutual funds and stock markets. Recent data from CBDT (Central Board of Direct Taxes) highlights that India’s net direct tax collection surged by around 22%, driven exclusively by the significant uptick in the collection of Securities Transaction Tax (STT), which doubled to Rs 26,154 crore, from Rs 13,352 crore in the year-ago period. Why does this matter? STT is levied when you buy or sell equity shares on stock exchanges, sell <keyword id="6361918" type="General" weightage="20" keywordseo="equity-mutual-funds" source="Orion">equity mutual funds</keyword>, and trade in futures and options in the equity segment. Such taxes, including the multiple other taxes in equity market investments, are considered as leakages as the money moves out of the economy into government coffers. Data from a ValueQuest report explains that over the last 20 years, the markets have handsomely rewarded the investors, generating over $900 billion in incremental value for them. This is the major driver behind the dramatic rise in investment flowing towards the equity markets. There’s further proof of this budding romance, if you check the demat pudding. The number of demat accounts, which are a primary requisite for participating in the stock markets, also burgeoned by 42.3 lakh in August 2024, taking India’s total tally of demat accounts beyond 17 crore. To put this in perspective, this is almost equivalent to the population of just 8 nations in the world, including China, the US, Brazil and more. Vivek Iyer, Partner, Grant Thornton Bharat thinks it's rather important, as well. “Financialisation of household savings in India is an indication of deepening capital markets in the market, especially from a retail investor standpoint. Bank deposits with a modest rate of return are no longer the only option for savings for investors. Investors today have more avenues for wealth creation in the form of public capital markets, which have democratized wealth creation and provided equality of opportunity to retail investors”, he says. Yes, Indians are investing more and more in the markets, and in mutual funds. But is it a sin to look out for inflation-beating returns, which the stock markets offer, and vanilla bank deposits don't? After all, the allure of 12-13% annual returns offered by <keyword id="45369" type="General" weightage="20" keywordseo="equities" source="Orion">equities</keyword> can certainly pale the stability offered by good old deposits, which generally do not go beyond 9% when it comes to annual returns. But all of this is not what is behind the slowdown. India is still a toddler in the school of savings financialization, with less than 10% of the population holding a demat account, and less than 5% of us saving in equities. That's a drop in the ocean of deposits, far inadequate to trigger a tsunami. <h2>Tell me why lagging deposits have nothing to do with Indians investing more in mutual funds!</h2>Says Shweta Rajani, Head - Mutual Funds, Anand Rathi Wealth Limited, “Households' equity holdings composition grew from 11.1% in FY 23 to 14.7% in FY 24. This trend reflects a growing awareness of investment options, empowering individuals to take control of their financial futures. Despite this transition towards equities, banks still hold a significant share of household financial savings—33.5% in FY24 compared to 34.9% in FY23”. Also, household savings and their subsequent financialization do not have much to do with deposit creation, which is entirely made by banks. What actually drives increased deposits is credit growth or increased lending. When interest rates are eased, people tend to borrow more and spend more, which circulates more money in the economy. For the past 4 years, RBI has been tightening the screws on interest rates, which raises the cost of borrowings, and makes it more expensive to take loans, putting a dampener on credit growth, but effectively curbing inflationary pressures. The last time RBI cut the repo rate by 40 basis points was back in May 2020, 4 years ago. The lag in <keyword id="19998084" type="General" weightage="100" keywordseo="deposit-growth" source="keywords">deposit growth</keyword> we’re witnessing is almost 3 years old. Coincidence much, or just good old economics at work? But with the Fed recently setting a rate cut precedent by slashing 50 bps off its interest rate, RBI is expected to follow suit in the next MPC (Monetary Policy Committee) meeting, scheduled for November 2024. A rate cut would ease the aforementioned high cost of borrowing, and increase loan-taking for corporates and institutional investors, thereby stoking consumption in the economy. And then, deposit creation in banks is likely to return to its former glory. If not, then that would be a curious case to unravel! But that worry is for another day. Do you have insights or personal experience to share on your personal finances or money? Contact us at <a target="_blank" class="c-link" href="mailto:businessinsider@timesinternet.in">businessinsider@timesinternet.in</a>.

Simply Put: A Deposit Dilemma — What's the fuss about a crisis in Indian bank deposits? Are mutual fund investments to blame?

<keyword id="20207838" type="General" weightage="20" keywordseo="dsp-mutual-fund" source="keywords">DSP Mutual Fund</keyword>'s September 2024 Netra report credits <keyword id="19895063" type="General" weightage="20" keywordseo="india" source="keywords">India</keyword>'s strong economic recovery to increased fiscal expenditure. The report, which tracks current economic trends and market insights through various charts, emphasizes the need for the private corporate sector and households to play a larger role in sustaining the ongoing growth momentum. Netra also pointed out an unsettling calm in the markets, with the Nifty 50 TRI index maintaining an impressive 53-month streak without a 5% decline and 13 years without a drop greater than 10%. Sahil Kapoor, Head of Products and Market Strategist, DSP Mutual Fund, said, "The calm in the markets, marked by an unnerving lack of volatility, is a double-edged sword. While it provides a sense of stability, it also masks underlying risks that could surface unexpectedly, catching investors off guard. To ensure a sustainable recovery, there is a need for the private sector and households to take the lead, transforming fiscal stimulus into lasting economic growth." However, the report notes a shift in market dynamics, with the momentum factor, which has outperformed since the COVID-19 bottom, beginning to lose its dominance. At the same time, the quality factor, which had underperformed over the last four years, is now seeing a resurgence, potentially indicating a change in market leadership that could favour quality-orientated funds, both active and passive. The report highlights the critical role government spending has played in the recovery, with a focus on capital investments crucial for future growth. However, contributions from the private corporate sector and households have lagged. It also draws attention to a slowdown in India's per capita consumption, approaching lows seen in previous cycles. Given that consumption accounts for around 60% of GDP, it is vital that this sector grows at a rate exceeding GDP growth to stimulate private capital expenditure. India's <keyword id="487578" type="General" weightage="20" keywordseo="tax-collections" source="Orion">tax collections</keyword> have demonstrated robust growth, with gross tax revenue showing a five-year compound annual growth rate (CAGR) of 14 %. This growth, largely driven by <keyword id="6354751" type="General" weightage="20" keywordseo="income-tax" source="Orion">income tax</keyword>, indicates a rising dependency on capital gains and stock market performance, introducing new vulnerabilities to the economy. The banking and financial services sector (<keyword id="19910880" type="General" weightage="20" keywordseo="bfsi" source="keywords">BFSI</keyword>) has emerged as a key driver of market earnings, recording a 12 % increase in profit after tax (PAT) growth, significantly outpacing the 4.6 % growth observed in non-BFSI Nifty 50 companies. This disparity underscores the sector's importance in India's economic story and highlights promising investment opportunities.

India's strong economic recovery is led by fiscal expenditure: DSP MF

The composite <keyword id="726966" type="General" weightage="20" keywordseo="Purchasing-Managers-Index" source="Orion">Purchasing Managers' Index</keyword> (<keyword id="19905748" type="General" weightage="20" keywordseo="PMI" source="keywords">PMI</keyword>) stood at 60.7, in July, reflecting buoyant economic activity, though the pace of acceleration had eased compared to the previous month which was at 60.9, according to <keyword id="22709468" type="General" weightage="20" keywordseo="Anand-Rathi-report" source="Orion">Anand Rathi report</keyword>. The Services PMI, recorded at 60.3 in July 2024, has consistently held above the 60-mark for seven consecutive months. This sustained performance is attributed to strong demand, increased investment in technology, and new business gains. The favourable <keyword id="877716" type="General" weightage="20" keywordseo="economic-conditions" source="Orion">economic conditions</keyword> and optimistic expectations for future output have driven one of the strongest increases in recruitment within the sector. The Manufacturing PMI placed at 58.1 in July, indicated strong expansionary trends, driven by buoyant demand and a notable increase in international sales. Producers responded to this demand by adding stocks at a sharp pace. Despite cost increases fueled by the strong demand for input goods, producers maintained their margins by raising selling prices. The sector saw continued hiring at one of the strongest rates, although the pace of job creation was slightly softer than in June 2024. Contrasting the domestic scenario, the global manufacturing outlook appears grim. In July 2024, the G-20 Manufacturing PMI fell below the 50-mark for the fourth consecutive month, indicating a contraction. The JPMorgan Global Manufacturing PMI slowed due to weaker growth in the United States and China, coupled with an ongoing downturn in the eurozone and Japan's entry into a contraction phase. Key issues identified included declining new orders and extended vendor lead times, pointing to supply-chain disruptions. Out of 32 countries surveyed, only 15 saw increases in their Manufacturing PMIs, with India showing the fastest growth. Looking ahead, domestic economic activity is anticipated to pick up, bolstered by improved weather conditions and increased government expenditure following recent elections. However, challenges remain due to weakening global growth and rising tensions in the Middle East, which could pose headwinds to domestic growth. The survey reported a significant rise in new work, considerably above the long-period average, and strong job creation across both the manufacturing and services sectors. Inflation, reaching an eleven-and-a-half-year high, coupled with rising input costs, has added pressure on businesses. The Services PMI stood at 60.3 and maintained its strong performance, driven by technology investments, robust demand, and new business gains. Notably, the sector experienced one of the strongest growths in new export orders since 2014, indicating a healthy international demand for services. The G-20 GDP-weighted Manufacturing PMI continued its downward trend for the fourth month, falling below the 50-mark in July. The JPMorgan Global Manufacturing PMI's slowdown reflects weaker growth in major economies such as the US and China, ongoing downturns in the eurozone, and Japan's contraction. Declining new orders and extended vendor lead times due to supply-chain disruptions have significantly impacted global manufacturing activity. Despite the global challenges, India's manufacturing sector remains resilient, expanding at the quickest pace among the surveyed nations. This resilience, coupled with strong domestic demand and favourable economic conditions, is expected to support continued growth in the coming months.

India's economic momentum stays strong with composite PMI at 60.7 in July 2024: Anand Rathi report

In line with the moderation in <keyword id="513422" type="General" weightage="20" keywordseo="retail-inflation" source="Orion">retail inflation</keyword>, wholesale <keyword id="158363" type="General" weightage="100" keywordseo="inflation-in-india" source="Orion">inflation in India</keyword> too witnessed a sharp decline in July. The annual rate of <keyword id="19895000" type="General" weightage="20" keywordseo="inflation" source="keywords">inflation</keyword> based on all India <keyword id="59350" type="General" weightage="20" keywordseo="Wholesale-Price-Index" source="Orion">Wholesale Price Index</keyword> (WPI) number is 2.04 per cent (provisional) for the month of July, 2024 (over July 2023). It continues to remain in the positive territory for the ninth month after remaining in the negative zone for seven months until October. Economists often say a little rise in <keyword id="280418" type="General" weightage="20" keywordseo="wholesale-inflation" source="Orion">wholesale inflation</keyword> is good as it typically incentivises goods manufacturers to produce more. For food index, which has 24.38 per cent weightage, the rate of wholesale inflation decreased from 8.68 per cent in June, 2024 to 3.55 per cent in July. The increase last month was largely due to higher prices in various categories including food articles, manufacture of food products, crude petroleum and natural gas, mineral oils, and other manufacturing sectors. The government releases index numbers of <keyword id="116267" type="General" weightage="20" keywordseo="wholesale-prices" source="Orion">wholesale prices</keyword> on a monthly basis on the 14th of every month (or the next working day). The index numbers are compiled with data received from institutional sources and selected manufacturing units across the country. In April last year, the wholesale inflation went into negative territory. Similarly, in the initial days of COVID-19, in July 2020, the WPI was reported negative. Overall wholesale inflation was 8.39 per cent in October 2022 and has fallen since then. Notably, the wholesale price index (WPI)--based inflation had been in double digits for 18 months in a row till September 2022. Meanwhile, India's retail inflation, after breaching 5 per cent in June, softened drastically in July. According to data released by the Ministry of Statistics and Programme Implementation, retail inflation or Consumer Price Index in July was at 3.54 per cent, which is the lowest in the last 59 months. In June, taking a departure from the moderation it witnessed in the past months, it rose to 5.08 per cent, pushed by rising food prices. Food inflation for July 2024 is the lowest since June 2023. Year-on-year inflation rate based on All India Consumer Food Price Index (CFPI) number is 5.42 per cent (Provisional) for the month of July, 2024. The corresponding inflation rate for rural and urban is 5.89 per cent and 4.63 per cent, respectively. Rising food prices continued to be a headache for Indian consumers with the inflation rate in the food segment almost doubling year-on-year in June. Food prices continue to remain a pain point for the policymakers in India, who wish to bring retail inflation to 4 per cent on a sustainable basis. However the latest retail inflation data showed the overall inflation has aligned with the intended target. Inflation has been a concern for many countries, including advanced economies, but India has largely managed to steer its inflation trajectory quite well. The eased month-on-month retail inflation, barring June, came on the heels of RBI having maintained the status quo in the repo rate for the ninth straight occasion. Barring the recent pauses, the RBI has raised the repo rate by 250 basis points cumulatively since May 2022 in the fight against inflation. Raising interest rates is a monetary policy instrument that typically helps suppress demand in the economy, thereby helping the inflation rate decline. The repo rate is the rate of interest at which the RBI lends to other banks.

Amid declining retail inflation, wholesale inflation in India moderates to 2.04% in July

The competition between <keyword id="19929098" type="General" weightage="20" keywordseo="Gautam-Adani" source="keywords">Gautam Adani</keyword> and <keyword id="19916798" type="General" weightage="20" keywordseo="Mukesh-Ambani" source="keywords">Mukesh Ambani</keyword> for the title of <keyword id="1919738" type="General" weightage="20" keywordseo="Indias-richest-person" source="Orion">India's richest person</keyword> has navigated a rollercoaster of fortunes. Their rivalry isn't merely a headline-grabbing feud, but a significant force shaping the Indian economic landscape. As of mid-August, Ambani remains the <keyword id="7413735" type="General" weightage="20" keywordseo="richest-person-in-India" source="Orion">richest person in India</keyword>. He is ranked 11th among the world's wealthiest individuals by Forbes, with a net worth of around $113 billion. On the other hand, Adani's net worth has fallen to approximately $84 billion, placing him 20th on Forbes’ real-time global list. Gautam Adani, chairman of the $32 billion (revenue) Adani Group, has witnessed a journey marked by dramatic ups and downs. In 2022, he soared to the rank of the world's second-richest individual before encountering a severe downturn. Allegations of corporate fraud by Hindenburg Research triggered a substantial sell-off in his company's stocks in 2023. Yet, Adani's determined recovery—focused on debt management and core business strengths—has paved the way for a remarkable rebound. By 2024, Adani group's shares also recovered substantially after India's Supreme Court ruled in the group's favour. Meanwhile, Mukesh Ambani—chairman and managing director at the $110 billion (revenue) Reliance Industries—has also experienced some fluctuations in his wealth and business activities this year. However, 2024 has been marked mainly by his personal milestones. The high-profile wedding of his younger son Anant Ambani with Radhika Merchant was attended by some of the most well-known celebrities and figures in the world, highlighting Ambani family's prominence in both business and social spheres. <cmsannotation type="cmsannotation" annotationid="Implications of Adani vs Ambani for the Indian economy" comment="subhead" text="Implications of Adani vs Ambani for the Indian economy">Implications of <keyword id="13480269" type="General" weightage="100" keywordseo="Adani-vs-Ambani" source="Orion">Adani vs Ambani</keyword> for the <keyword id="6356076" type="General" weightage="20" keywordseo="Indian-economy" source="Orion">Indian economy</keyword></cmsannotation> The ongoing competition between Ambani and Adani is not just a personal battle; it has broader implications for the Indian economy. Firstly, heightened competition between these business giants is likely to benefit consumers by driving improvements in pricing and services within sectors they both dominate, including telecommunications, retail and renewable energy. Additionally, as their enterprises grow, they are expected to generate a significant number of job opportunities across diverse fields. This competitive dynamic also fosters a climate of innovation, as both conglomerates invest heavily in emerging technologies and sustainable practices, thereby bolstering India's position as a leader in these areas. Both billionaires represent different paths to success, with Ambani's legacy-driven approach contrasting with Adani's entrepreneurial journey, underscoring the diverse opportunities within the Indian economy. The ongoing race between Mukesh Ambani and Gautam Adani epitomises the dynamic nature of wealth creation in India. With Adani currently in the lead, the competition promises to continue shaping economic trends and consumer experiences in the country.

Adani vs Ambani: Mukesh Ambani has overtaken Gautam Adani in race to become richest person in India

<ul><li>A study by <keyword id="19900426" type="General" weightage="100" keywordseo="Accenture" source="keywords" meta.keywordsubtype="org" meta.entityname="Accenture" meta.hostid="261" meta.entityid="Accenture">Accenture</keyword> says GenAI could add billions to Indian economy</li><li>The study added that 31 percent of working hours in India could be automated</li><li> Indian economy could be up by as much as USD 675 billion by 2038</li></ul> In the last two years, there have been many debates about the possibility of AI replacing human beings at their jobs. Various tech experts have expressed their opinions on this. While there is one section of people saying that AI will make it easier for human beings to do their jobs, there is another section that fears being replaced altogether. Talking about the section that thinks AI will help humans do their jobs better, various experts have said in the past that AI will focus on mundane aspects of a job so that human beings can be fully focused on more challenging and creative parts. And a new study by Accenture seems to support this argument. Moreover, the study also says that due to the use of generative AI, Indian economy could be up by as much as USD 675 billion. <h2>GenAI could add USD 675 billion to Indian economy</h2>According to the study by Accenture, adopting a people-centric approach to GenAI could potentially add USD 675 billion to India's economy by 2038. This transformative impact hinges on a bold vision for reinvention, underscored by strong data and technology foundations, and an intentional approach to workforce development. The <keyword id="22702248" type="General" weightage="20" keywordseo="Accenture-study" source="keywords">Accenture study</keyword> highlights that the deployment of GenAI could automate approximately 31 percent of working hours in India. This significant shift is expected to contribute a 0.6 percentage point increase to the annual GDP growth, showcasing GenAI's potential as a powerful economic driver. However, the journey to harnessing this potential is fraught with both opportunities and challenges. For the unversed, generative AI, a subset of artificial intelligence, involves machines generating text, images, or other media in response to prompts. This technology has far-reaching implications for industries ranging from capital markets to retail, banking, insurance, and software platforms. Globally, these sectors are expected to witness the automation or augmentation of 49% to 71% of working hours due to GenAI. <h2>31 percent automation in India</h2>The Accenture study also highlights that in the Asia-Pacific region, the impact of GenAI is anticipated to be substantial, with Australia and Japan seeing the highest impact at 45% and 44% of working hours, respectively. For India, the projection of 31% automation signifies a seismic shift in how businesses operate and how work is performed. <keyword id="22702250" type="General" weightage="20" keywordseo="saurabh-kumar-sahu" source="keywords">Saurabh Kumar Sahu</keyword>, Lead for India Business at Accenture, underscored the necessity of a bold vision for reinvention. He said that the scaled and responsible deployment of GenAI can drive revenue growth and act as a force of change, reinventing functions across industries. However, unlocking the real value of GenAI requires businesses to have robust data and technology foundations. "The scaled and responsible deployment of generative AI can not only drive revenue growth but also act as a force of change that can reinvent almost all functions across industries. To unlock its real value, businesses need to have a bold vision for reinvention anchored in a strong data and technology foundation. This, coupled with an intentional approach to skilling, is crucial to succeed in the age of generative AI," Sahu said in a statement according to a report in Business Standard. <h2>89 percent businesses plan to increase AI spending</h2>Despite the promising prospects, there is a critical gap in preparation that could hinder the effective integration of GenAI. The Accenture study reveals that while 89% of businesses plan to increase spending on AI, only 35% prioritise workforce development. Moreover, a mere 4% of business leaders have implemented GenAI training at scale. This disparity underscores the urgent need for comprehensive skill development programs. As organisations embrace GenAI, equipping the workforce with the necessary skills is important to ensuring that the technology's implementation is both effective and sustainable. SEE ALSO: <a href="https://www.businessinsider.in/artificial-intelligence/news/verizon-sees-early-success-using-generative-ai-to-answer-questions-from-business-customers/amp_articleshow/112145960.cms" data-type="tilCustomLink" target="_blank">Verizon sees early success using generative AI to answer questions from business customers </a><a href="https://www.businessinsider.in/tech/news/yup-ai-is-basically-just-a-homework-cheating-machine/amp_articleshow/112330231.cms" data-type="tilCustomLink" target="_blank">Yup, AI is basically just a homework-cheating machine</a>

Indian economy could get USD 675 billion due to AI by 2038, study shows

India's economy is expected to grow at 7-7.2 per cent in the current fiscal year driven by robust economic fundamentals and continuity in domestic policy reforms, <keyword id="20006170" type="General" weightage="100" keywordseo="Deloitte-India" source="keywords" meta.keywordsubtype="org" meta.entityname="Deloitte India" meta.hostid="261" meta.entityid="Deloitte India">Deloitte India</keyword> said on Monday. The August update of <keyword id="19896400" type="General" weightage="20" keywordseo="deloitte" source="keywords">Deloitte</keyword>'s India Economic Outlook said several initiatives in the <keyword id="19908389" type="General" weightage="20" keywordseo="union-budget" source="keywords">Union Budget</keyword> 2024-25 toward improving agriculture productivity, creating jobs for the youth, and in manufacturing and addressing the challenge of access to finance for micro, small, and medium enterprises (MSMEs), would help improve supply-side demand, curb inflation, and prop up <keyword id="20139791" type="General" weightage="20" keywordseo="consumer-spending" source="keywords">consumer spending</keyword>, especially in rural areas. Deloitte India Economist Rumki Majumdar said, India will witness robust growth in the second half after a period of uncertainty in the first six months of the year. "Key contributing factors include the continuity in domestic policy reforms, reduced uncertainties in the US post-elections, and more synchronous global growth within a low inflation regime. "Additionally, improved global liquidity conditions, as central banks in the West ease their monetary policy stance, will enhance capital flows and drive higher investments, particularly in the private sector," Majumdar said. Observing that strong economic fundamentals would drive <keyword id="19972825" type="General" weightage="20" keywordseo="GDP-growth" source="keywords">GDP growth</keyword> between 7 per cent and 7.2 per cent in FY25, the Economic Outlook report said effectively addressing the urban-rural consumer spending gaps, inflation, and employment concerns can significantly enhance the affordability of aspirational rural consumers. "The much-desirable policy pivot was evident in the Union Budget presented last month. Reducing the urban and rural spending gap in the coming years will ensure sustained consumer demand from a larger consumer base," it added. Deloitte India's growth projection is at par with that of RBI, which projected FY'25 growth at 7.2 per cent. It is higher than Finance Ministry's Economic Survey which estimated GDP expansion between 6.5-7 per cent. The <keyword id="19948184" type="General" weightage="20" keywordseo="Indian-economy" source="keywords">Indian economy</keyword> grew at 8.2 per cent in 2023-24 fiscal year. The report further said despite strong growth, private consumption spending has remained modest over the past five years. The pandemic, high global and domestic inflation, consequent tightening of financial conditions, and the effects of poor agriculture output on rural demand seem to have capped private consumption growth in India. But a Deloitte research showed that India is witnessing distinct and broad-based shifts in consumption patterns. There is a broad-based shift in the composition of consumption towards more non-food and discretionary items, reflecting changing lifestyles and preferences that are here to stay. According to the Household Consumption Expenditure Survey, spending on discretionary goods and services (including conveyance) has gone up both in rural and urban India, with the former quickly catching up in spending on discretionary durable goods (including automobiles, electric and electronic goods) with the latter in just one decade. "Demand for processed food has been among the highest in most states, suggesting a shift towards ready-to-eat options. Rapid urbanization, increasing women's participation in the workforce, and enhanced marketing and availability are driving these changing dietary habits," the report said. According to Deloitte research, if increasing income in states results in a relatively equitable distribution and higher rural spending, businesses can tap into a larger proportion of the state's population that resides in rural areas. This gives businesses access to a large consumer base and a sustainable consumer spending demand, as compared to states with a widening gap.

Indian economy likely to grow at 7-7.2 percent in FY25,Deloitte India says

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.

You Searched For "Indian economy" and got 13 results

Indian economy is resilient despite Q2 challenges, says CEA Nageswaran

BI India Bureau

No village in India left without access to electricity, claims FM Nirmala Sitharaman

ANI

5G to inject $450 billion into Indian economy by 2040: Telecom Minister Scindia

ANI

Karwa Chauth festivities to boost economy by ₹22,000 crore

BI India Bureau

Fundamental drivers of economy gaining momentum, India on sustainable growth path: RBI Governor Das

PTI

Simply Put: A Deposit Dilemma — What's the fuss about a crisis in Indian bank deposits? Are mutual fund investments to blame?

Ira Alok Puranik

India's strong economic recovery is led by fiscal expenditure: DSP MF

ANI

India's economic momentum stays strong with composite PMI at 60.7 in July 2024: Anand Rathi report

ANI

Amid declining retail inflation, wholesale inflation in India moderates to 2.04% in July

ANI

Adani vs Ambani: Mukesh Ambani has overtaken Gautam Adani in race to become richest person in India

BI India Bureau

Indian economy could get USD 675 billion due to AI by 2038, study shows

Divyanshi Sharma

Indian economy likely to grow at 7-7.2 percent in FY25,Deloitte India says

PTI

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

ANI

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