REVIVAL TRENDS: INDIA SHINING
If historical patterns are anything to go by, the voting in of the 15th Lok Sabha or the House of the People, the directly elected lower house of the Parliament of India, will mark a starting point for a sharp ramp-up in economic activity for the country. Economic activity, as measured by industrial production index, had increased immediately after five elections out of seven polls since 1984, as political stability provided a platform for economic growth.
Economic activity has risen consecutively following the last three elections held on 1998, 1999 and 2004. A comparison of industrial production (IP) data before elections and six months after elections, shows that on five occasions, the IP index rose by 20-80 basis points, according to data from Goldman Sachs Global ECS Research.
The Interim Budget for the financial year 2009-10 announced in February by the Finance Minister of the ruling United Progressive Alliance (UPA), focused on infrastructure development, easing of Foreign Direct Investments (FDIs) norms and economic stimulus packages that set the ground for how the alliance was approaching the General Elections.
The new Government that comes in to power would be best served if it continued and augmented the “India Shining” policies that currently sustain a Gross Domestic Product (GDP) growth of more than 7% as India continues to defy negative GDP growth seen in many Western economies.
Such growth initiatives have led to an economic revival in key sectors like steel, cement, automobile, food and beverages and fast moving consumer goods (FMCG) (See Vol 4 | Issue 3 ‘Clearing The FDI Highway’) that are best not derailed.
Showing posts with label FMCG. Show all posts
Showing posts with label FMCG. Show all posts
Thursday, May 14, 2009
Sunday, March 01, 2009
CLEARING THE FDI HIGHWAY
The Government of India has yet again unfolded the red carpet to Foreign Investments by augmenting its Foreign Direct Investment (FDI) guidelines to provide the much needed capital injection to cash-starved sectors, such as retail, real estate & infrastructure, telecommunication, among others, that need capital infusion of more than $600 billion over a period of five to 10 years.
The new guidelines state that foreign holdings in a company with majority control of Indians will not be treated as indirect foreign investment in any downstream subsidiary, thus expanding investment opportunities for global investors seeking to be a part of the growth story of the world’s second fastest growing economy.
The easing of FDI norms fall in line with other growth initiatives and stimulus packages announced by the government last year, which have started showing revival trends in key sectors like steel, cement, automobile, food and beverages and fast moving consumer goods (FMCG).
The cement sector grew 10% in December 2008 as compared to November and the year on year increase of 11%. Steel declined steadily through September, October and November last year. The sector recovered in December 2008 and January 2009 touching the May 2008 figure of 22.86 metric tonnes when the sectoral growth rate was 4.1%. The automobile sector grew too, with the January 2009 figures in the passenger vehicles sales showing a 32% rise over December 2008 and commercial vehicles at 23% over a similar time frame. FMCGs and food & beverages have recorded a year on year growth of 26.4% and 28% respectively for the quarter ended December 31, 2008. Such growth trends across sectors send assuring signals of economic revival and corresponding profitable investments for investors.
The Government of India has yet again unfolded the red carpet to Foreign Investments by augmenting its Foreign Direct Investment (FDI) guidelines to provide the much needed capital injection to cash-starved sectors, such as retail, real estate & infrastructure, telecommunication, among others, that need capital infusion of more than $600 billion over a period of five to 10 years.
The new guidelines state that foreign holdings in a company with majority control of Indians will not be treated as indirect foreign investment in any downstream subsidiary, thus expanding investment opportunities for global investors seeking to be a part of the growth story of the world’s second fastest growing economy.
The easing of FDI norms fall in line with other growth initiatives and stimulus packages announced by the government last year, which have started showing revival trends in key sectors like steel, cement, automobile, food and beverages and fast moving consumer goods (FMCG).
The cement sector grew 10% in December 2008 as compared to November and the year on year increase of 11%. Steel declined steadily through September, October and November last year. The sector recovered in December 2008 and January 2009 touching the May 2008 figure of 22.86 metric tonnes when the sectoral growth rate was 4.1%. The automobile sector grew too, with the January 2009 figures in the passenger vehicles sales showing a 32% rise over December 2008 and commercial vehicles at 23% over a similar time frame. FMCGs and food & beverages have recorded a year on year growth of 26.4% and 28% respectively for the quarter ended December 31, 2008. Such growth trends across sectors send assuring signals of economic revival and corresponding profitable investments for investors.
Wednesday, June 25, 2008
Microsoft pips Infosys, SBI in most reputed firms list
US software giant Microsoft has topped the list of most reputed companies in India ahead of homegrown major Infosys and public sector banking giant State Bank of India.
The Economic Times
http://economictimes.indiatimes.com/
Microsoft_is_the_most_reputed_firm_in_India/
articleshow/3159984.cms
The Economic Times
http://economictimes.indiatimes.com/
Microsoft_is_the_most_reputed_firm_in_India/
articleshow/3159984.cms
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