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The CEO’s Reading List

| Updated on October 12, 2019 Published on October 12, 2019

Did you miss all the important happenings on the economy this week because you were taking a festival break?

Here’s a curated reading list of BL’s most important economic stories through the week!

Slipping competitiveness

India’s been steadily climbing the Ease of Doing Business rankings. But it isn’t doing quite as well on the WEF’s Global Competitiveness index, where it slipped 10 places to 68h rank this year. The WEF ranked India high on macroeconomic stability and market size and said its financial sector is relatively deep and stable despite the high delinquency rate, which contributes to weakening its banking system. It flagged limited ICT adoption, poor health conditions and low healthy life expectancy.

India slips 10 places to 68th on global competitiveness index

Mini-stimulus

Amid clamour for personal income tax rate cuts to match the recent corporate tax cuts, the Government has quietly taken a different route to put more money in the hands of consumers. The rate of DA for government employees and pensioners is set to go up from 12 per cent to 17 per cent with retrospective effect from July 1 2019. This also means that government staff will get lumpsum payments in the form of three months’ arrears on the DA. While one may be intrigued by the higher DA at a time when CPI inflation is so low, the Government claims this hike is in line with the 7 th Pay Commission formula.

DA for central govt employees pensioners to go up by 5%

 

Finally, privatisation

Privatisation plans are getting a fresh makeover with reports saying that the government is readying Air India, apart from BPCL and Concor for a majority stake sale again. The earlier attempt a year ago didn’t take off due to the Centre retaining a stake and attaching one too many conditions to the bids, but this time it may do better with the Tatas throwing their hat into the ring.

Air India buy: Tata Sons back at the drawing board, may place bid soon

 

No deal please

As Modi and Xi began their informal tete a tete at Mamallapuram, the industry and farmers were asking the

Government to refrain from signing the RCEP, fearing that it would open the borders to a flood of low-duty imports, as had happened with other Free Trade Agreements before.

RCEP: why industry and farmers fear it

 

Credit crunch

RBI’s recent monetary policy report had scary data on credit flow to industry. It showed that incremental bank credit to industry, which was Rs 1.65 lakh crore in H1 FY19 was at a negative Rs 93,688 crore in H1 FY20, even as NBFCs also withdrew from lending.

The evaporating credit flow to India's businesses from banks and NBFCs

But this seems to have galvanised the Centre with the FM promising to roll out more measures to help resolve the NBFC liquidity crisis.

Finance ministry ready  to do more for nbfcs, says Nirmala Sitharaman

 

Ad splurge

Consumer firms have lined up a Rs 20,000 crore splurge on advertising to coax customers into buying this festival season.

e-tailers seen leading Rs 20,000-cr-ad blitzkrieg this festival season

 

Dipping IIP

The week ended on a gloomy note with the IIP showing a 1.1 per cent contraction in August. Within it, primary (1.1per cent), intermediate (7 per cent) and consumer non-durable growth (4.1 per cent)were positive while other sectors such as capital goods (-21 per cent) contracted. Given that the latter have always been volatile, it is best not to read too much into one’s month’s numbers.

Factory output turns negative, clocks slowest pace in 7 years

Why red eye

Did you know why international flights from India take off at such insane hours? Its because some developed world airports go to sleep for the night!

Why international flights from India take off at insane hours

 

Compiled by Aarati Krishnan

Published on October 12, 2019
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