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January inflation eases to 5.07%, December IIP lower at 7.1%

The higher target came in place of the 3.2 per cent — or Rs 5.46 lakh crore — for the current fiscal announced earlier.

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Retail

A slight easing of food prices helped lower India’s retail inflation in January to 5.07 per cent even as factory production growth slowed somewhat in December to 7.1 per cent, according to official data on Monday.

India Inc lauded the continuing high single-digit recovery in industry as well as the slight fall in inflation.

While retail inflation was 5.21 per cent in December 2017, the Index of Industrial Production (IIP) had grown at an impressive 8.8 per cent in November.

On a year-on-year basis, the consumer price index (CPI) last month was at a much higher level than the 3.17 per cent in January 2017.

The consumer food price index (CFPI) in January stood at 4.58 per cent compared with the 4.85 per cent of December 2017.

As per the data released by the Central Statistics Office (CSO), the sequential slowdown in factory output was mainly on account of lower production in the manufacturing sector.

However, on a year-on-year basis, the manufacturing sector expanded by a healthy 8.4 per cent, while the mining sector’s output inched up by 1.2 per cent and the sub-index of electricity generation increased by 4.4 per cent.

“In terms of industries, 16 out of the 23 industry groups in manufacturing sector have shown positive growth during December 2017 compared with corresponding month of the previous year,” the CSO said.

According to the data, the industry group ‘manufacture of other transport equipment’ has shown the highest growth of 38.3 per cent followed by 33.6 per cent in ‘manufacture of pharmaceuticals, medicinal chemicals and botanical products’ and 29.8 per cent in ‘manufacture of computers, elecronic and optical products’.

Last week, The Reserve Bank of India (RBI) kept its key interest rate unchanged at 6 per cent for the third time in succession at its final bi-monthly monetary policy review of the fiscal, citing upside risks for inflation from rising global crude oil prices and other domestic factors.

The RBI said its decision to keep its repo rate, or short-term lending rate for commercial banks, unchanged is consistent with the neutral stance of the central bank aimed at achieving its median inflation target of 4 per cent.

“We expect headline inflation to be at 5.1 per cent in the fourth quarter (January-March), including the impact of HRA (house rent allowance) to central employees, up from the 4.6 per cent in Q3,” RBI Governor Urjit Patel told reporters in Mumbai after the release of the monetary policy review.

However, the fact that the central bank did not raise the repo rate in the face of hardening inflation as recommended by one of the six monetary policy committee (MPC) members is being considered as an attempt to aid in economic recovery.

Industry chamber Assocham termed the IIP data “a positive sign towards growth cycle of industrial activity in India”.

“However, risks to the Indian economy continues to prevail in the forms of continued uncertainties in the global environment due to geo-political situations, including rising global protectionism could further delay a meaningful recovery of external demand,” said Assocham President Sandeep Jajodia.

“Besides, private investment continues to face several impediments in the form of corporate debt overhang, stress in the financial sector, where (banks’) NPAs (non-performing assets) continue to increase, excess capacity and regulatory and policy challenges,” he added.

“This is the second consecutive month in which IIP has shown high single-digit growth, which is encouraging,” India Ratings and Research (Ind-Ra) Principal Economist Sunil Kumar Sinha said in a statement.

“However, Ind-Ra believes it still early to read much from these numbers as these have been calculated on a low base when industrial output had collapsed due to the impact of demonetisation,” he said.

“Retail inflation came down to 5.07 per cent in January 2018, lower than 5.21 per cent recorded last month, but remained higher than the RBI’s base target value of 4 per cent,” he added.

Rating agency Crisil said that inflation, however, continued to firm up in large parts of the services sectors such as housing, driven by the revision in house rent allowance payments, education and in recreation, amusement and personal care and effects.

“Yet, core inflation, stayed broadly unchanged from the previous month, at around 5.1 per cent in January,” a Crisil release said.

“The industry seems to be shedding away the weight of GST-related glitches behind and trying to get back lost momentum, as both domestic and global growth surge.”

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Back series GDP calculation proved UPA years best: Chidambaram

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P Chidambaram
P. Chidambaram (File Photo)

New Delhi, Aug 18: Former Union Minister and senior Congress leader P. Chidambaram on Saturday challenged Prime Minister Narendra Modi’s government to match up with the UPA’s GDP rate in its fifth year and said that back series calculation of GDP has proved that the best years of economic growth were the UPA years 2004-2014.

Quoting figures of the recently released Ministry of Statistics’ data, Chidambaram said: “Truth has triumphed. The back series calculation of GDP has proved that the best years of economic growth were the UPA years 2004-2014.”

“The average growth rate under four governments since 1999 were– NDA I – 5.68 per cent, UPA I – 8.36 per cent UPA II – 7.68 per cent and NDA II – 7.35 per cent (four years),” Chidambaram tweeted.

“I wish the Modi government well in its fifth year. It can never catch up with UPA I, but I wish it catches up with UPA II,” he added.

Chidambaram said that the UPA governments delivered the best ever decadal growth and lifted 140 million people out of poverty and thanked the people for the opportunity to serve them for 10 years.

IANS

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SBI contributes Rs 2 cr for flood-hit Kerala

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Mumbai, Aug 18: The State Bank of India (SBI) has donated Rs 2 crore for the Kerala flood victims and initiated several other ground-level measures in the deluged state, an official said on Saturday.

The SBI has encouraged all its 270,000 staffers to contribute to the Chief Minister’s Distress Relief Fund (CMDRF), and the bank would contribute an equivalent amount.

It also announced a waiver of fees and charges on services like loans for flood relief, duplicate passbooks, ATM cards, cheque books and EMI delays, besides making attempts to restore the working of branches and ATMs in the flood affected regions of the state.

Besides, the SBI has decided to waive all charges on remittance to the CMDRF, penalty on non-maintenance of minimum account balance from proceeds of relief fund provided by the government and agencies and if already recovered, such charges would be refunded for customers in the state.

The bank has extended Xpress Credit to existing customers with relaxed norms for a month, deployed cash at PoS (Point of Sale) to enable people avail Rs 2,000 to meet daily cash requirements across the state.

Persons who have lost or displaced personal documents can open small accounts with only photos and signature or thumb impressions and all employees of SBI deployed to address requirements of the customers and ensure best possible service.

At least  324 persons have lost their lives, thousands displaced or stranded as incessant rains pounded Kerala since the past 10 days, causing havoc in 12 districts.

With IANS Inputs

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Army, Navy rescue marooned people in Karnataka’s flood-hit district

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Srirangapatna flood

Bengaluru, Aug 17 (IANS) Indian Army troops and Navy divers joined the national and state disaster relief forces to rescue hundreds of people marooned in Karnataka’s flood-hit Kodagu district, said an official statement on Friday.

“About 60 Dogra Regiment soldiers and 12 expert naval divers rescued 873 marooned people in the flood-hit district, where overnight heavy rains caused landslides and inundated low-lying areas at Makkanduru,” said the statement from the Chief Minister’s office here.

Kodagu, about 250 km from Bengaluru, is one of the districts in the southern state worst hit by the south-west monsoon rains since June first week.

The Army’s engineering task force deployed 73 boats, equipment and rafts in rescuing the people and escorting them to safer places in the district.

About 60 members of the national and state disaster relief forces and 45 members of the civil defence joined the rescue and relief operations with boats and equipment in Madikeri in the hilly district.

“Though the Indian Air Force (IAF) aborted rescue mission due to inclement weather, it will fly M17 chopper from Mysuru on Saturday to rescue the remaining stranded and transport relief supplies,” noted the statement.

About 200 personnel of the state fire service had rescued people in flood-hit towns and villages across the district with their boats and equipment.

“Telecom services, disrupted due to rains and strong winds uprooting poles and snapping phone lines, are being restored on priority. HAM operators have been deployed as back-up. Power lines are also being restored,” said the statement.

The district administration has housed 573 persons in 17 relief camps.

Intra and inter-state bus and train services between Karnataka and flood-hit Kerala were suspended due to landslides and rain water submerging the highways and roads in the ghat section.

State-run and private bus services from Mysuru and Chamarajanagar to Ooty and Coonoor hill stations in Tamil Nadu were suspended due to flooding and fallen trees blocking the routes in the ghat section.

According to the weather office, rain fury continued in the state’s coastal districts of Dakshina Kannada, Udupi and Uttara Kannada, disrupting normal life, including vehicular movement of goods and people.

Incessant rains lashed the Malnad region, flooding several areas in Shivamogga, Hassan and Chikkamagaluru districts.

Schools and colleges will remain shut even on Saturday in the affected districts due to flooding and disruption of bus services.

The state’s metrological department has warned of moderate to heavy rain in coastal, south interior and north interior areas of the state till Sunday.

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