Skip to main content

Moody’s pegs FY’15 growth at 5.5%

Stating that the forthcoming elections will delay the reform process and hurt growth, international rating agency Moody’s on Monday said it expects growth to pick up to only 5.5 per cent in FY’15.

“We expect GDP growth to remain weak at 5.5 per cent in FY’15 as the elections will delay reforms needed to revive growth,” it said in a note.

Growth has been below the trend for much of FY’14 and the government’s official estimate pegs it at 4.9 per cent, a bit higher than 4.5 per cent achieved in FY’13. Elections are scheduled for April-May.

It said interest rates will continue to remain high and hence the rupee will continue to be volatile, making it difficult for importers and exporters.

The agency also gave a negative outlook for non-financial corporates in 2014 on weak economy, political uncertainty and effects of the US Fed’s tapering.

“Lower economic growth, volatile exchange rates, rising borrowing costs and slow economic reforms have dampened prospects across many sectors,” it said in the report prepared with its local counterpart ICRA.

It specifically said domestically focused sectors like real estate, cement, automotive, steel, metals and mining, and retail which are dependent on “vagaries of regulation and policy-setting” have negative outlooks.

Others like exploration and production, IT/business process outsourcing and pharma which are linked to developments in the external sector are comparatively better placed, it said.

The report said pharma segment will benefit from patent expiries in the US and gave a stable outlook for the sector.

For the telecom sector also it gave a stable outlook, saying earnings will improve on the back of consolidation and improved pricing power with operators. However, the entry of Mukesh Ambani-led Reliance Jio can temper the trend, it cautioned.

Comments

Popular posts from this blog

Cloud seeding

Demonstrating the function of the flare rack that carries silver iodide for cloud-seeding through an aircraft. 
Water is essential for life on the earth. Precipitation from the skies is the only source for it. India and the rest of Asia are dependent on the monsoons for rains. While the South West Monsoon is the main source for India as a whole, Tamil Nadu and coastal areas of South Andhra Pradesh get the benefit of the North East Monsoon, which is just a less dependable beat on the reversal of the South West Monsoon winds.

SC asks Centre to strike a balance on Rohingya issue (.hindu)

Supreme Court orally indicates that the government should not deport Rohingya “now” as the Centre prevails over it to not record any such views in its formal order, citing “international ramifications”.

The Supreme Court on Friday came close to ordering the government not to deport the Rohingya.

It finally settled on merely observing that a balance should be struck between humanitarian concern for the community and the country's national security and economic interests.

The court was hearing a bunch of petitions, one filed by persons within the Rohingya community, against a proposed move to deport over 40,000 Rohingya refugees. A three-judge Bench, led by Chief Justice of India Dipak Misra, began by orally indicating that the government should not deport Rohingya “now”, but the government prevailed on the court to not pass any formal order, citing “international ramifications”. With this, the status quo continues even though the court gave the community liberty to approach it in …

India’s criminal wastage: over 10 million works under MGNREGA incomplete or abandoned (hindu)

In the last three and half years, the rate of work completion under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) has drastically declined, leading to wastage of public money and leaving villages more prone to drought. This could also be a reason for people moving out of the programme.

At a time when more than one-third of India’s districts are reeling under a drought-like situation due to deficit rainfall, here comes another bad news. The works started under the MGNREGA—close to 80 per cent related to water conservation, irrigation and land development—are increasingly not being completed or in practice, abandoned.

Going by the data (as on October 12) in the Ministry of Rural Development’s website, which tracks progress of MGNREGA through a comprehensive MIS, 10.4 million works have not been completed since April 2014. In the last three and half years, 39.7 million works were started under the programme. Going by the stipulation under the programme, close to 7…