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India fastest growing economy at 7.4% in 2018: IMF

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United Nations: The International Monetary Fund (IMF) reaffirmed on Wednesday that India will be the fastest growing major economy in 2018, with a growth rate of 7.4 per cent that rises to 7.8 per cent in 2019 with medium-term prospects remaining positive.

The IMF`s Asia and Pacific Regional Economic Outlook report said that India was recovering from the effects of demonetisation and the introduction of the Goods and Services Tax and “the recovery is expected to be underpinned by a rebound from transitory shocks as well as robust private consumption.”

Medium-term consumer price index inflation “is forecast to remain within but closer to the upper bound of the Reserve Bank of India`s inflation-targeting banda of four per cent with a plus or minus two per cent change, the report said.

 

However, it added a note of caution: “In India, given increased inflation pressure, monetary policy should maintain a tightening bias.”

It said the consumer price increase in 2017 was 3.6 per cent and projected it to be five per cent in 2018 and 2019.
“The current account deficit in fiscal year 2017-18 is expected to widen somewhat but should remain modest, financed by robust foreign direct investment inflows,” the report said.

After India, Bangladesh is projected to be the fastest-growing economy in South Asia with growth rates of seven per cent for 2018 and 2019; Sri Lanka is projected to grow at four per cent in 2018 and 4.5 in 2019, and Nepal five per cent in 2018 and four per cent in next. (Pakistan, which is grouped with the Middle East, is not covered in the Asia report.)

Overall, the report said that Asia continues to be both the fastest-growing region in the world and the main engine of the world`s economy.

The region contributes more than 60 per cent of global growth and three-quarters of this comes from India and China, which is expected to grow 6.6 per cent in 2018 and 6.4 per cent in 2019, it said.

The report said that US President Donald Trumps fiscal stimulus is expected to support Asias exports and investment.

The Asian region`s growth rate was expected to be 5.6 per cent for 2018 and 2019.

However, in the medium term the report said that “downside risks dominate” for the region and these include a tightening of global financial conditions, a shift toward protectionist policies, and an increase in geopolitical tensions.

Because of these uncertainties the IMF urged the countries in the region to follow conservative policies “aimed at building buffers and increasing resilience” and push ahead with structural reforms.

“While mobile payments are expanding sharply in such economies as Bangladesh, India, and the Philippines, on average Asia is lagging sub-Saharan Africa,” the IMF said, adding that the region should take steps to ensure it is able to reap the full benefits of increasing digitalisation in the global economy.


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RBI’s vision document on payment systems to spur digital economy: Fintech firms

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New Delhi: The RBI’s ‘Payment Systems Vision 2021’ document would act as a catalyst for promoting digital economy and instill confidence among the general public, fintech companies say.

Aiming at a ‘cash-lite’ society, the Reserve Bank of India last week released the vision document for ensuring a safe, secure, convenient, quick and affordable e-payment system as it expects the number of digital transactions to increase more than four times to 8,707 crore in December 2021.

The RBI has said it will implement the approach outlined in the document during the period 2019 – 2021.

 

COO of Payworld Praveen Dhabhai said the vision document has a focus on empowering payment system providers and at the same time providing ease to consumers.

“We are confident with our vision as a payment system provider aligned with the regulators, we will be able to contribute in increasing the digital transactions penetrations especially in the assisted segment in smaller cities and rural Indian,” he said.

Navin Surya, Chairman Emeritus, Payments Council of India said: “Clarity in defining outcomes in terms of scale of digital and overall payments vis a vis GDP is a very good measurement to look forward to and also assess the impact of work done by all stakeholders.”

However, KYC simplicity, digital KYC and KYC bureau, as well as simplification of existing policies to enable NBFCs to issue credit cards is missing from the document, said Surya, who is also the chairman of Fintech Convergence Council.

Mandar Agashe, founder and vice chairman, Sarvatra Technologies, was of the opinion that the 24X7 helpline that the RBI plans to set will help in instilling confidence in customers regarding the digital payments system.

Other than this, geo-tagging of payment system touchpoints will help companies understand where and what type of transactions are taking place, which will also lead to curtailing frauds, he added.

The document said payment systems like UPI/IMPS are likely to register average annualised growth of over 100 per cent and NEFT at 40 per cent over the vision period (up to December 2021).

The ‘Payment and Settlement Systems in India: Vision 2019 – 2021’, with its core theme of ‘Empowering Exceptional (E)payment Experience’, envisages to achieve “a highly digital and cash-lite society” through the goal posts of competition, cost effectiveness, convenience and confidence (4Cs).

Gaurav Chopra, founder and CEO, IndiaLends, said, “With growing competition, industry players will be able to offer services at an optimal cost to their customers. RBI aims to bring innovation in technology and processes that will eventually save time of end consumers.”

CEO and co-founder of NiYO, Vinay Bagri said some of the measures proposed by RBI, such as self-regulatory organisation, strengthening offline payments and feature phone-based payment services, will go a long way in democratising the payments ecosystem.

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PE inflow in Indian retail real estate doubles to $1.2 bn in 2017, 2018: Anarock

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New Delhi: Indian retail real estate sector attracted private equity investment worth USD 1.2 billion during 2017-18 calendar years, double from the previous two years, according to property consultant Anarock.

The consultant attributed the sharp rise in private equity (PE) inflow to further liberalisation in FDI policies such as 51 percent FDI in multi-brand retail and 100 percent FDI in single-brand retail under the automatic route.

From an investment of USD 600 million during 2015-2016 calendar years, private equity inflows in retail real estate jumped to over USD 1.2 billion between 2017 and 2018.

 

Of total USD 1.84 billion inflow in the last 4 years (2015-2018), tier II and tier III cities attracted nearly 48 percent funds (USD 880 million) against USD 960 million in tier 1 cities.

Top favoured tier II and tier III cities included Amritsar, Ahmedabad, Bhubaneshwar, Chandigarh, Indore and Mohali.

US-based funds like Blackstone and Goldman Sachs have invested more than USD 1 billion between 2015-2018, while UAE, Singapore, Canada and Netherlands based funds were also active.

Shobhit Agarwal, MD & CEO – Anarock Capital says, “our report highlights the fact that unlike the commercial office sector, retail is to some extent geography-agnostic because its success depends on the spending power of its target audience.?

“As a result, shopping malls in tier II and tier III cities have performed as well as, if not better than, their tier 1 counterparts. This also led to increase in rentals and profitability and caused PE investors to start considering investment options outside their accustomed tier I geographies,? he added.

Anuj Kejriwal, MD & CEO – Anarock Retail said, “the opportunity that the Indian retail sector holds in store for PE investors is more than evident – as are the geographies they must focus on for optimum returns.?

Anarock data reveals that around 39 million sq ft of organised retail space is expected to enter the market between 2019-2022. Of this supply, around 71 percent is expected to come up in tier I cities, and the remaining 29 percent in tier II and tier III cities, Kejriwal added.

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Cash, goods worth Rs 3,400 crore seized during Lok Sabha elections 2019:EC

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New Delhi: After the completion of the seventh and final phase of polling , the Election Commission said cash, drugs, liquor and precious metals worth Rs 3,449.12 crore were seized by enforcement agencies since the Lok Sabha polls were announced on March 10.

This is thrice of what agencies seized during the 2014 Lok Sabha poll process. In 2014, law enforcement agencies made seizures worth Rs 1,206 crore, the EC’s director general (election expenditure) Dilip Sharma said.

Law enforcement agencies between March 10 and May 19 seized Rs 839.03 crore in cash, liquor worth Rs 294.41 crore, drugs worth Rs 1,270.37 crore, precious metals, including gold, worth Rs 986.76 crore and “freebies”, including sarees, wrist watches, aimed at inducing voters worth Rs 58.56 crore were seized.

 

EC officials said they directed social media platforms, including Facebook, Twitter and WhatsApp, to remove several that were found to violate the EC’s code.They said social media platforms removed 909 posts. Facebook removed 650 posts, Twitter took down 220 posts, ShareChat removed 31, YouTube five and WhatsApp three.

Of the 650 posts taken down by Facebook, 482 were political messages posted during the “silence period”. The “silence period” starts 48 hours before the hour set for conclusion of polling in a particular phase. The seventh phase of polling came to a close at 6 pm on Sunday, so the “silence period” had begun at 6 pm on Friday for this phase.

As many as 73 social media posts were political advertisements in the “silence period”, two were in violation of the Model Code of Conduct, 43 were related to voter “misinformation”, 28 were dubbed as those crossing the limits of decency, 11 were related to exit polls and 11 were hate speeches, Ojha said.

There were also 647 confirmed cases of paid news, of which the maximum of 342 were reported in the first phase itself, he added. During the 2014 Lok Sabha polls, 1,297 confirmed cases of paid news were reported, Ojha said.

The EC on Sunday continued to receive criticism from the Opposition while Prime Minister Narendra Modi thanked it for granting him permission for his visit to Uttarakhand’s Kedarnath temple.

Modi visited Kedarnath on Saturday, spent the night in a cave and left for Badrinath on Sunday morning. “I did not ask for anything. I don’t believe in asking because God only wants us to give… all I want is ‘Baba’ Kedarnath bestows his blessings not just upon India but entire mankind,” he said at Kedarnath.

The PM thanked the EC for allowing him to undertake the visit, saying he got two days of “rest” there. The EC had given its nod to Modi’s visit while “reminding” the Prime Minister’s Office that the model code of conduct is still in force.

Congress President Rahul Gandhi said the Election Commission’s “capitulation” before the PM was obvious. “From electoral bonds and EVMs (electronic voting machines) to manipulating the election schedule, NaMo TV, ‘Modi’s Army’ & now the drama in Kedarnath; the Election Commission’s capitulation before Mr Modi & his gang is obvious to all Indians,” Gandhi tweeted. “The EC used to be feared and respected. Not anymore,” he said.

“Polling is over. Now, we can say that the ‘pilgrimage’ of the PM in the last two days is an unacceptable use of religion and religious symbols to influence the voting,” Congress leader P Chidambaram said.

Telugu Desam Party chief N Chandrababu Naidu wrote to the EC stating that “continuous” telecast of the PM’s “private activities” at Badrinath and Kedarnath shrines were in violation of the poll code and should be stopped.

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