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CSO pegged erroneous 7.1% GDP estimates, experts

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GDP Data

New Delhi, January 7: The advance estimate of 7.1 per cent GDP released by Central Statistical Organisation (CSO) could be erroneous as it fails to cater to data for the months after demonetisation.  

Domestic rating agency ICRA on Friday pegged the expected growth for 2016-17 lower at 6.8 per cent. “Given the impact of demonetisation on actual activity from mid-November 2016 onward, projecting GDP growth for the full year by extrapolating the trends up to October 2016 for several sectors, may introduce more errors than in earlier years. This would be particularly apt for cash intensive sectors such as construction,” said ICRA in a statement.

ICRA anticipates GDP (gross domestic product) and GVA (gross value added, which excludes taxes and subsidies) growth for FY2017 at 6.8 per cent and 6.6 per cent respectively, which is lower than the advance estimates of CSO. CSO pegged growth of real GVA in 2016-17 at 7 per cent against 7.2 per cent in 2015-16.

ICRA further pointed out that unfolding trend in sub-sectors such as manufacturing, agriculture, electricity and construction could result in lower growth.

ICRA said unavailability of corporate filings for third quarter of FY2017 and second advance estimates of Rabi output (as opposed to the available data on sowing), are likely to constrain the accuracy of the advance estimates.

While Rabi sowing has grown by a healthy 7 per cent on a subdued base, activity and incomes related to non-crop agricultural sectors including horticulture and livestock may have been adversely impacted by the liquidity crunch, it added.

Yesterday, Former Deputy Chairman of erstwhile Planning Commission Montek Singh Ahluwalia also forecasted at least 1 -2 % fall in the GDP growth. Ahluwalia had said government should immediately take steps to put the economy back over the 7 percent growth.

“Instead of 7 per cent, the economic growth will be 5 plus or 6 plus this year,” said Ahluwalia.

Citing the underlying strength in Indian economy, Ahluwalia said, once the shock due to demonetisation is behind us, economic growth should be above 7 per cent.

An editorial “India’s Slowing GDP Growth Forecast to 7.1% Does Not Include Effects Of Demonetisation” published in Forbes says, “demonetisation has caused a reasonably serious hit to GDP this quarter past. It would not surprise me if growth was negative in fact–although that most certainly not my central guess. Others have suggested 1, 2, 4% hits to growth as a result of the demonetisation. I find all of them believable and wouldn’t want to have to choose between them.

The effects of demonetisation on Indian industry, manufacturing, and supply chain are far reaching and the forecast on GDP growth can not be accurately accounted until it caters perils left out by note ban on all the sectors.

Wefornews Bureau

Business

How to start your own cryptocurrency

Hands up who’ll buy an IdiotToken from me? And no, you can’t pay me in cryptocoins. I want hard cash. I may be an idiot but I’m not stupid.

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cryptocurrency

Fed up of standing by watching while others make and lose fortunes on cryptocurrencies? Now you too can make and lose a fortune!

This columnist realised it was time to tackle this topic when a news report said more than 1,500 Bitcoin-like cryptocurrencies had been launched and a reader asked me for advice on starting his own.

Easy, I said. Whose head would you like to be on it? He chose his own, which showed me that he had no idea what a cryptocurrency was. They are not physical coins, so don’t have anyone’s heads on them.

Never mind. Most people don’t understand these things. This is good.

Things you can sell to unsuspecting friends as Bitcoins: 1) game arcade tokens; 2) foreign coins; 3) toy medals; and 4) chocolate money.

But one of my more serious colleagues is starting his own cryptocurrency; so I know the system.

1. Download the main coin mining software from a website called Github, then hire a nerd, as you have to tweak the programme (with C++) to make it unique.

2. Think of a theme. It is impossible to be too wacky. For example, one person made a cryptocoin called “Offerings to Cthulhu”, named after an alien from a 1928 sci-fi story. You’d think that was too silly to work, but it is going strong after several years.

3. When people start buying your currency, sell them all and run away as fast as you can.

If the last part of this process reminds you of anything, it should. It is the same technique used by people working for criminal gangs (“banks”) for pushing evil scams such as sales of stocks and shares, unit trusts, investment bonds, Ponzi schemes, etc.

It’s an exciting field. In January this year, the value of Bitcoins was going up and down so fast (in a $10,000 range) that you had to discuss it with a live price tracker in your hand. Here’s a typical conversation:

ME: “I’ll buy your car for one Bitcoin.” HIM: “No way! This car’s worth more than… $9,845.” ME: “More than… $11,245? No, it isn’t. That’s a good price.” HIM: “Okay, you got a deal.” ME: “I’m now transferring to you one Bitcoin.” HIM: “Wait. This is only worth… $7,231.” ME: “Too late, Byeee.” [Drives off.]

Bitcoin analysts say the number of new coin issues is accelerating so we’ll each have our own currency in “the mid-to-long-term future”, meaning a week next Tuesday. Shopping will be challenging.

SHOPPER: “Do you accept Flurgles?” SHOPKEEPER: “Yes, but your change will be in Oogliewooglies.”

What to call your coin? All the cool names have already been taken, including Mysterium, Einsteinium and BitBean. Others are odd, like the Melon, or desperately unimaginative, like the Namecoin.

I reckon it’s time to stand out and get attention by using an ironically humorous name for your new Bitcoin. Four suggestions:

1) SweetLittleNothings; 2) Don’tBuyThese; 3) Moneypits; and 4) IdiotTokens.

Okay, hands up who’ll buy an IdiotToken from me? And no, you can’t pay me in cryptocoins. I want hard cash. I may be an idiot but I’m not stupid.

By : Nury Vittachi

(Nury Vittachi is an Asia-based frequent traveller. Send ideas and comments via his Facebook page)

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Equities propel on broad-based buying, cues from Asian markets

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Mumbai, Feb 23: The key Indian equity indices on Friday closed at almost a week’s high levels as positive cues from the Asian markets, along with a strong rupee and value buying, uplifted investors’ sentiments.

According to market observers, easing worries of a rate-hike by the US Federal Reserve in the near term, coupled with healthy buying in almost all the sectors — led by metals, banking and healthcare stocks — added to the upward trajectory of the key indices.

The wider Nifty50 of the National Stock Exchange (NSE) edged higher by 108.35 points, or 1.04 per cent, to close at 10,491.05 points.

The barometer 30-scrip Sensitive Index (Sensex) of the BSE settled near its day’s high of 34,167.60 points to close at 34,142.15 points — up 322.65 points, or 0.95 per cent, from its previous close.

The BSE market breadth was bullish with 1,899 advances and 831 declines.

The broader market indices outperformed the Sensex, with the S&P BSE mid-cap index closing higher by 1.47 per cent and the small-cap index by 1.54 per cent.

“Markets surged higher on Friday as the Nifty closed just below the 10,500 levels. The gains came on the back of positive Asian equity markets,” Deepak Jasani, Head – Retail Research, HDFC Securities, told IANS.

“It was also the first trading session of the derivatives March near-month series. The Sensex and the Nifty settled at over one-week high on broad-based buying,” Jasani added.

On the currency front, the Indian rupee strengthened by 31 paise to close at 64.73 against the US dollar from its previous close at 65.04.

In terms of investments, provisional data with the exchanges showed that foreign institutional investors sold scrips worth Rs 486.32 crore, while domestic institutional investors purchased stocks worth Rs 1,514.03 crore.

Vinod Nair, Head of Research, Geojit Financial Services, said: “Market rebounded amid value buying on beaten down sectors like PSU banks, metal and pharma.”

“Additionally, ease in fears on US Fed rate hike trajectory led the 10-year yield to fall, comforting investors’ sentiment,” Nair added.

All the 19 sub-indices of the BSE closed with gains, led by metals, banking and healthcare sectors.

The S&P BSE metal index rose by 469.96 points, banking index by 356.63 points and healthcare index by 266.85 points.

Major Sensex gainers on Friday were: Tata Steel, up 6.26 per cent at Rs 677.80; Sun Pharma, up 5.17 per cent at Rs 570.20; Yes Bank, up 2.28 per cent at Rs 323.60; Dr Reddy’s Lab, up 2.26 per cent at Rs 2,169.25; and Bharti Airtel, up 2.26 per cent at Rs 425.45.

The Sensex losers were: Asian Paints, down 1.29 per cent at Rs 1,101.90; Coal India, down 0.48 per cent at Rs 310.45; Infosys, down 0.42 per cent at Rs 1,155.65; Mahindra and Mahindra, down 0.22 per cent at Rs 719.30; and Hindustan Unilever, down 0.16 per cent at Rs 1,323.

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PNB stocks plunge over 30% in 8 trade sessions

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Mumbai, Feb 23: During the eight trading sessions following the detection of a $1.8 billion fraud in one of the branches of the Punjab National Bank (PNB), the bank’s shares on the BSE have plunged almost 30 percent to a price of Rs 113.40 per share.

On Friday — the eight trading day since the unfolding of the multi-crore-rupee scam — shares of PNB closed lower by 1.09 per cent at Rs 113.40 per scrip.

The stocks have plummetted 29.84 per cent since close on February 12 at Rs 161.65 per share.

Gitanjali Gems, the other entity involved in the fraud case, also witnessed a fall in its shares for the eighth consecutive day — down 4.98 per cent to Rs 24.80 per share on Friday.

Since its closing at Rs 62.85 per share on February 12, the company’s share has nosedived 60.54 per cent.

The shares of the two companies had started to decline following the country’s second largest state-run bank PNB’s declaration on February 14 of unearthing a fraud of Rs 11,300 crore involving diamantaire Nirav Modi.

The fraud, which included money-laundering, among others, was related to the Firestar Diamonds group in which the Central Bureau of Investigation (CBI) booked Modi, his wife Ami, brother Nishal Modi and uncle and business partner Mehul Choksi — the promoter of luxury jewellery brand Gitanjali Gems.

IANS

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