Can Indian Economy Avert Crash Landing in 2011?

[SpArK]

India's exports seen above $220 billion in current fiscal news ​

12 February 2011

India's exports in the current financial year could well cross the $200 mark and touch $220 billion on the back of booming demand for its products in the West, commerce secretary Rahul Khuller said today.

India's exports grew 32.5 per cent to $20.6 billion in January, helping the country earn $184.6 billion from exports in the April 2010 to January 2011 period.

The end-January export figure is just short of $15.6 billion from the earlier target of $200 billion.

The gains came mostly from buoyant exports of gems, jewellery, engineering goods and petroleum products, Khuller said.


At the current rate of growth India's exports could cross $200 billion in February and cross $220 billion by end-March 2011, he noted.

"On the whole, export performance is pretty good. My guess is by next month we will cross $200 billion and we should end this financial year at $220-$225 billion," Khuller said.

India's exports vaulted 32.5 per cent in January helped by a 70 per cent increase in the exports of engineering goods and a 36 per cent jump in the exports of petroleum and oil products.

Exports from the country increased 29.4 per cent in the first 10 months of 2010-11 against a whole year target of 15 per cent.

Total imports grew 17.6 per cent to $273.6 billion in the April-January period. India, however, imported goods worth $28.6 billion in January 2011. This leaves a trade deficit of $89 billion.

Other sectors that have reported better than expected performance in exports are: cotton yarn and made-ups (up 52 per cent at $4.7 billion), electronics (up 38 per cent at $6.4 billion) and plastics and linoleum (up 40 per cent at $3.7 billion).

domain-b.com : India's exports seen above $220 billion in current fiscal

 

[RiazHaq]

KSE-100 is so far flat this year but BSE is in sharp decline as foreign buyers are fleeing.

Whatever happened to the Indian equity market? asks the BBC:

Back in November, the Sensex squeezed past 21,000 for a day before starting a three month, 16% fall.

In the same time, the world's main indices, the FTSE Dow and Nikkei have all gained up to 7%, two of the remaining BRIC countries have fallen no more than 7%, and Russia's RTS Index has gained 26%.

Unsurprisingly foreign funds have been fleeing Indian equities in the last three months.

India is in a pickle and two reasons spring to mind - the stock market was heavily overvalued and the Central Bank has been raising interest rates.

At the end of the year the price of the average share on the Sensex was 23 times its earning power (ie its p/e ratio was 23 x). The Shanghai Index was 18 x, Brazil's Bovespa 14 x and Russia's just 9 x (the Dow's p/e was 13 x). That kind of valuation may be fine if future growth seems assured, but there are signs it may be falling off.
'Leg down'

GDP in real terms expanded at an annual rate of 8.2% in the last quarter - slowing from the 8.9% rate recorded in April to June. Now, this isn't a serious problem and no one is suggesting that the Indian growth story is in serious trouble, but it may be more than just a blip.

Maya Bhandari, senior economist at Lombard Street Research, says that, on a seasonally adjusted basis, growth was pretty much flat. She adds: "I would expect another leg down in the market in the coming few months."

Food inflation has been entrenched for some time, which means the Reserve Bank started putting up interest rates a year ago and has since hiked them seven times.

"In the last 25 months or so, we have had negative real interest rates and the central bank is going to have its work cut out to bring down inflation. And while it may be raising rates, the bank is holding more auctions and lowering the statutory liquidity levels for banks - all of which has inflationary consequences," says Ms Bhandari.

On top of domestic inflation pressures, the Middle East and North Africa crisis sent oil prices belting up above $100 a barrel, adding to the central bank's imperative to keep the upward pressure on rates.
Rate rises?

India is the world's the fourth largest oil importer and imports over 70% of its oil requirements. Oil prices, which will stay high for as long as the Arab crisis lasts, will damage India's economy more than most of its main rivals. At the moment, most economists are pencilling in another half to one percentage point rise in rates.

Oil is also going to hurt government finances. In his March budget, Finance Minister Pranab Mukherjee estimated that the deficit would fall from an estimated 5.1% of GDP in the year ending March 31, to 4.6% next fiscal year.

But if oil prices keep on going up, the government will have to decide whether to keep on paying out fuel subsidies or deregulate diesel prices.

Keeping the deficit under control would suggest the latter.

Five state elections in the next few months would suggest the former.

London-based India investment consultancy director Deepak Lalwani points out that foreign confidence in India has also not been helped by a slew of scandals, the biggest being allegations that the 2008 sale of second-generation, or 2G, cellular licenses resulted in losses of nearly $36bn in potential revenue for the government.

BBC News - Indian stock market in a pickle as foreign funds flee

 

[The HBS Guy]

Mr. Haq, less than 10 months remain for your prophecy to come true.

Come, 1st Jan 2012 and we shall talk.

 

[Whiplash]

@Haq: Don't flatter yourself with a comparison. The KSE jas a market cap of 35 billion dollars. The BSE 1.7 Trillion.

 

[Kinetic]

KSE-100 is so far flat this year but BSE is in sharp decline as foreign buyers are fleeing.

Do you have any knowledge what are you talking about? Do you know what is the market cap of Karachi and Mumbai stock exchanges? lol

KSE, Karachi: $ 32.5 billion
BSE, Mumbai: $ 1630 billion
NSE, Mumbai: $ 1600 billion

Can Indian Economy Avert Crash Landing in 2011?

We are already in 2011 and India's economy growing faster now!!! GDP growth is 8.7% while will cross 9 percent n next fiscal. lol Some people can't digest it.

 

[RoYaL~GuJJaR]

Seriously, This guy need some break....lol

As one of the member said above we will talk to you on 2012 january...Until then enjoy those self-satisfactory,self -proclaimed article on your own blog...

I am outta this bogus Thread....and will return here on january 2012 to show one of my fav finger to someone....lol

 

[The HBS Guy]

Do you have any knowledge what are you talking about? Do you know what is the market cap of Karachi and Mumbai stock exchanges? lol

KSE : $ 32.5 billion
BSE : $ 1630 billion

BSE is 50 times KSE!

50 times!



What's next? A comparison of KSE and NYSE!

I wonder how many times would NYSE be of KSE!

 

[Kinetic]

BSE is 50 times KSE!

50 times!



I wonder how many times would NYSE be of KSE!

Add NSE from Mumbai as well, it has Market cap of $ 1600 billion. So how many times now?

 

[The HBS Guy]

Add NSE from Mumbai as well, it has Market cap of $ 1600 billion. So how many times now?

I'm weak at maths

 

[Whiplash]

I think there are single companies in the BSE with equity worth more than 32.5 billion XD

 

[Markus]

^ During boom time, ONGC and RIL had market cap of $100 billion each.

 

[Whiplash]

ZOMG THERE ARE!

RIL has a market cap of 76 billion! This is so funny!

 

[The HBS Guy]

ZOMG THERE ARE!

RIL has a market cap of 76 billion! This is so funny!

Shhhhhhh...It's bad manners to derive fun from someone's agony.