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MAHINDRA The Slide of the US Dollar
REVA
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Economy, Market & Finance : Page 5
Corporate : Page 3

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China-India bilateral India becomes world's fourth-largest economy with 13% '20 GDP growth !
trade rising, says top
Surpasses Germany & closing in rapidly on Japan
official
By Omkar Barve However, new administration has achieved sustained
. Our Bureau . Posted on 2 January 2020
growth especially with new collaborative approach
with India.
NEW DELHI New Delhi: India has become the world's fourth-
Chinese GDP stood at 11.6 trillion dollars for
largest economy, surpassing Germany and closing
Beijing: Bilateral trade between 2019.It has shown an average GDP growth of 9% for
rapidly on Japan, according to government and
China and India is rising since 2017 last decade. Analysts believe that China would surpass
-18, new deputy high commissioner World Bank figures. The Indian government revised
US GDP in another five years. Despite real growth, its
of India to the US, YP Roy has its growth figures for 2020 from 12 percent to 13 per-
Yuan devaluation which is resulting in low GDP fig-
said. Roy, who was speaking at the cent this week, bringing its estimated gross domestic
ures while strengthening Rupee has helped India to
Overseas Indian Center (OIC) meet product to $4.04 trillion - about 2 percent larger than
achieve this landmark. Three Asian giants (China, Ja-
at Beijing on Tuesday evening, Germany's $3.96 trillion for the same year, based on
pan and India) occupying spots in top 5 positions re-
said the trade between China-India World Bank estimates. Government of India is
flects the story of fastest growing economies in the
after a brief slump in 2015-16, has expected to release its 2020 GDP figures next week.
world.
been growing at a “terrific” rate. United states continue to be at the top spot
“Today China is India’s 3rd largest Indian economy grew by an average of 12%
closely followed by China and Japan. United States
trading partner globally and first in every year for last decade. On the other hand, Ger-
GDP was reported to be 17.43 trillion dollars for
Asia, followed by Japan. However many grew at an average 2%. However, there are
2019.It grew by an average 2% for last decade and is
there is a much bigger scope to fur- signs of slowdown in Asian economies especially Chi-
expected to continue 2% growth in next 3 years. US
ther increase the share of Indian nese growth rate has declined to 9.3% which is below
could not recover from its 2009 recession as late as
companies in the Chinese market.”, forecasted 10.2%. If this slowdown spreads across
early 2015.
he said. Asia then Indian economy may also slow down.

Auto Scrap Piling Up Indian Pharmaceutical into the world’s top 10 pharmaceutical India to allow use of space
markets in the year 2015, overtaking Bra-
in the Metros market now 7th in the World zil, Mexico, South Korea and Turkey, technology to Brazil
Bureau Bureau when its market touched the US$ 20 billion
mark. The absolute growth of US $ 14 bil- In a landmark decision, India has decided to offer
During the past decade as pharmaceutical lion in 2015 over the last 10 years was next its Space Technology and expertise to Brazil con-
companies were scanning for new growth only to USA and China. firming its advancement in space related technolo-
Even though the major carmakers opportunities they realized that some of the As per the latest report the public gies.
are very conscious about recycling spending on healthcare which was 7 per
most promising are to be found in the
their vehicles already during the cent of GDP in 2007, 13 per cent of GDP . By Rahul Raj .
world’s leading developing economies. NEW DELHI
production, the auto scrap in the in 2015 stands now at 19 per cent of GDP.
developing countries are now 393 Due to India’s sustained economic growth, External Affairs Minister, Shashi Tharoor and Brazil-
healthcare reforms and pat- Overall the size of the phar-
million tons. This number has tri- ian Foreign Minister Celso Amorim met at Hydera-
ent related legislation it has maceutical market has
pled during the last 20 years. bad House in New Delhi and signed what is known as
become the preferred desti- crossed the US $ 26 billion Technology Safeguards Agreement (TSA) which
The introduction of End-
nation of pharmaceutical mark taking India to the 7th strengthens Indo-Brazil space ties.
of-Life Vehicle programs 15 years
industry. position in the world, just India is on the verge of launching its first
ago, where the producer of the car
The disease ahead of countries like Spain, manned Chandrayaan (Chandrayaan - 4) into space in a
also is responsible for the recy-
patterns in India have un- Italy and Canada. However week’s time which will establish India on the world
cling, is the reason that the recy-
dergone a shift. Increas- per capita annual spending on map alongside US. To strengthen ISRO’s (Indian
cling rate is now about 95% in the
ingly stressful lifestyles pharma products is still low Space Research Organization) supremacy, this deal
developed countries. Unfortu-
have led to significant in- and India ranks a dismal will allow India to help Brazil in their Space explora-
nately, the developing countries st
tions. India will be sharing its future space programs
creases in the incidence of 51 .
like India are still to follow. These with Brazil. This has come as a big achievement as
chronic diseases. While govt intervention Ranbaxy Laboratories Limited, the
developing countries are facing an Brazil, a component of BRIC nation which has shown
has brought some acute ailments under biggest pharmaceutical manufacturing
environmental challenge in taking tremendous growth over the last few years. Brazil ear-
control, a sizeable part of Indian population company in India, is now ranked at the 3rd
care of their auto scrap. The main lier relied heavily on United States for Space Tech-
remains susceptible to a wide range of position among the global generic pharma-
issue for them at present is how to nology.
acute diseases. ceutical companies and has presence in 75
handle non-ferrous metals, plastics Brazil would be using the space technology for
Driven by increasing affordability, countries including world class manufac-
and rubber that are more difficult applications such as land management, water resources
shifting disease pattern and modest health- turing facilities in 25 countries and serves management, natural disaster forecasting, radio net-
to recycle than steel and iron.
care reforms the Indian pharma industry to customers from over 140 countries. working, weather forecasting, meteorological imaging
has grown at a CAGR of 10% over the past and computer communication.
5 years. Indian pharma industry zoomed Brazil's space-launch program, coupled with
its artillery rocket technology, suggests that the country
has the potential to develop advanced missiles, includ-
ing ballistic missiles. Brazil no longer relies heavily on
the United States for space technology. India’s In-
dian Space Research Organisation (ISRO) will work
with the Brazilian National Institute for Space Re-
search (INPE), share data and help to develop and im-
plement scientific experiments, and train the institute's
technicians and scientists.

By: H4 G8&9 Great Lakes Institute of Management


THE POLITICAL THEATRE
THE ECONOMIC TIMES THURSDAY 2 JANUARY 2020
2 SERIOUS, SOLID POLITICS: GOING BEHIND THE SCENES & DECODING

Bihar – Rising from the shadows


CM, Nitish Kumar in last 15 years has done what it takes to bring a state like Bihar from bottom to the top. Bihar has truly come out into its own.

Bihar and their relatives outside used to feel insecure and the state which has tremendously helped building Knowl-
kept calling them during the day and night just to be as- edge capital. Villages have been upgraded and enough op-
sured that they are alright. portunities are provided to reduce migration to other states
Bihar’s per capita income has risen 4 times in last 12-15 like Maharashtra and Delhi. With awareness among people,
years and stands at ` 56740 well above the national average corruption has taken a back seat and growth and develop-
per capita income which is a proof of well being of the peo- ment has been the mantra which Bihar has followed.
ple in the state. Child mortality rate has been reduced with Several measures like free girl education and re-
better sanitation and hospital facilities and every macro ducing school drop-outs has helped Government to in-
socio-economic indicator tells a success story. crease the literacy level from the bottom. With the increase
All this has been possible with the planning and in per capita income of people in Bihar and economic pros-
efficient implementation of those plans. Bihar has been perity, crime has been greatly reduced. This has been one
working extensively on developing its infrastructure. Bihar reason in bringing back a lot of people who migrated to
is primarily an agriculture centric state and State Govern- other parts of the country initially for better life style
ment has worked towards strengthening its strength. A and security.
new water treaty signed with Bangladesh and Nepal has
worked wonders for Bihar and adjoining states. Dams have Nitish’s Bihar is an example of what good Governance can
By Rahul Raj been built and water storage has been efficient which re- do!
Special Correspondent duced flood/drought situation of every year and helped
farmers in irrigation during an uneven monsoon. Food
Not long ago, Bihar was considered one of the most back- reserves have been abundant. Bihar has started exporting
ward states in terms of developments, literacy rates, corrup- food grains to other parts of India and a good amount of
tion and administrative problems. However things have revenue is generated.
changed over the last 10 – 15 years. Gone are the days Opening up of IITs and IIMs along with several
when someone from other state used to attend functions in other reputed institutions have helped Bihar retain talent in

Half way through the Inclusive Growth Path


A reflection on Vision 2020..
. By Rahul Jain . proved considering the fact that India share of Scientist and policy has to have dedicated phone line and Computer net-
technologist now stands at 12% as compared to 7 % half a works to all villages with in 15 km radius. Because of it now
With the Indian Vision of 2020 coming to maturity this year decade back. As a result of which of the averages 6,00,000 the whole country has access to medical facility. It is evident
has the Rural India has had its share of the Pie? The answer patents India contribution has been 50,000. in the face that the Infant Mortality rate has dropped to
is yes and No. Yes to the fact that development has begun 15/1000, The maternal mortality rate falling to lowest ever
but no because it’s not completed and still a lot of it has to As far as business is concerned phone has become the most of about 8000 women last year simply because of higher
be completed. IT and Telecom has played a major part in powerful application. It has now enabled business transac- level of medical awareness, accessibility and availability.
coping to the biggest challenge of Health, Education and tion without even meeting. Today the farmer from a district/ This is evident in the improvement of India’s position of
Business in 4 lakhs villages of India. town can directly negotiate with 56th position from 85th ranking in the ranking of WHO
With focus on inclusive growth in recent the city vendor. This has cut out ranking of health system.
years, the capital /industry investment a lot of middle men there by re-
structure and government policies have ducing the overall cost of the India was ranked 4th in the Happiness and Satisfaction rank-
made sure the Per capita almost quadruple product. There is increased level ing conducted by the WHO in association with Deutsche
in the last decade from of empowerment with rural India
` 34000 to ` 122250 which ranked India at bank. It considered Economic as well as non economic
than ever before. With about 60
the 47 place in the Per capita index. India factors like environment of living, satisfaction in work;
crore of middle class population
was also ranked in the PPP GDP Per capita the organized retail is now on the quality of life, time spent in personal development activities.
index at the 49 position making a statement upslope path. India share of or- But this is not the end picture as the income level has
that Indian economy has moved from Low ganized retail is about 11 percent increased so has the movement of population to cities
class to middle or upper middle class econ- and is currently worth `1.8 tril- increased the stress on urban infrastructure. The government
omy lion of India needs to be careful on how it wants to tread on the
The Educational Scenario has improved As per last year projection, 83
second of the inclusive growth. Rural infrastructure and
drastically primarily due to the 1, 25,000 million of population will above unification of small villages into one should be the key focus
Edusat terminals and internet in all the re- 65 years of age which makes the area. This would help channel the infrastructure develop-
mote areas. Today there is 100% enrolment health infrastructure expenditure an important aspect which ment in a much better way.
at primary and secondary level with drop out of only 15 %. as of now form 2.8% of GDP and hopefully should increase
The Literacy rate of female also increased to 89% which another 1% in the near future. IT and Telecom has played
is evident in India ranking of 51th position in the UNDP’ the most significant of connecting the rural India to all the
gender development index. Higher education is also im- medical facility. Every Hospital as per the new government
CORPORATE
3 THE ECONOMIC TIMES THURSDAY 2 JANUARY 2020

Information Technology: IndiaCan to add 400


Share of IT, ITeS in India’s GDP to go up to 15 percent by
Helping virtual terror vocational training centres
2021
Bureau
in 2 years
By Pravin Patil
New Delhi: US Security advisor, James Mumbai IndiaCan, a joint venture between In-
Welch, on his visit to India, met Home Information technology (IT) and IT-enabled services (ITeS) sector will account for fifteen dia's Educomp and Pearson, plans to add
Minister D. Y. Rao. During press confer- per cent of the country's gross domestic product (GDP) by 2020-21 against 12 per cent in 400 vocational centers to its existing
ence he said, “Information technology, 2019-20, government sources said. The contribution of the IT sector to the country’s GDP network of 600 vocational training cen-
allowing instant connectivity, communi- has been increasing consistently over the last decade. This trend is expected to continue in ters in the next two-years.
cation and learning has enabled the terror the foreseeable future. India, being the services giant of the world, provides jobs to around There will be centers across the
threat to become increasingly decentral- 120 million people in the country. All these data point to only one thing; the inevitable J&K, Assam, NE states, Jharkhand and
ized. It is becoming more and more diffi- growth of the Indian IT industry. Orissa. The centers will focus on jobs
cult to identify these terrorists and neu- Knowledge in the form of information technology (IT) has opened up the opportu- across segments including finance, retail,
tralize them. There are no stationary ter- nity for India to become the premier, low-cost provider of computer software and IT- IT and hospitality, among others and is
ror headquarters now. Training material, enabled services to the industrialised world. Knowledge in the form of biotechnology, eyeing the opportunities in rural markets
instructions, weapons knowledge and manufacturing technology offered not only a lucrative field for employment and economic for training young people.
fund raising has all become virtual growth, but a means for improving the health of our people, productivity of our fields and While the educational attainment and
(Online).” raised the competitiveness of the Indian manufactures to international standards of costs and skill level of the rural workforce deter-
quality. mines the productivity as well as the
ability to adapt to the changing industrial
Indian IT companies in come up with such a ridiculous road map.
environment, a majority do not possess
Hydrogen Vehicles and Hybrid marketable skills, often a critical block-
collaboration bag UK Govt. This is completely unrealistic, unfeasible. Not
ing factor in getting employment and
Cars in India a single country anywhere in the world has
project considered anything like this possible."
improving their economic condition.
Indiacan will train unemployed
During the past decade there have
Bangalore: TCS, Infosys, Wipro and Way back in 2006, the Indian government had and under-employed youth aged 14
been several demonstrations and pilot projects
Satyam in collaboration have bagged a set up a National Hydrogen Energy Board years and upwards who have dropped
around the world that have proved the effi-
multiyear deal from UK government. The (NHEB), with public-private partnership un- out of schools and colleges for various
cacy of hydrogen energy and fuel cell tech-
ten year project will be divided in two der the chairmanship of the Union minister for reasons that include affordability and
nologies. Defying the claims of RK Pachuari,
phases, first being data collection and new & renewable energy sources Vilas employment needs.
India has also successfully tapped this natural
sorting, and second being software imple- Muttemwar. The NHEB’s steering committee resource and is developing commercially vi-
mentation. under the chairmanship of noted industrialist able large scale plants. But the major chal-
The collaboration model of Noel Tata and with the help of five expert lenge before the Indian government now is to
Indian IT companies is working well to groups had formulated the National Hydrogen ensure that proper production, safe storage,
their own advantage. The gap, which was Energy Road Map for the country on Novem- transportation and delivery are followed. India GCMMF achieves its
evident earlier, between Indian software ber 21, 2005.The Indian Government planned
companies and global IT giants like IBM, to ensure that at least a million hydrogen-
is behind its target of a million hydrogen fu- Mission 2020
elled vehicles on road though. By Priyank Sinha
Accenture is fast reducing. The collabo- fuelled vehicles will hit the roads by Delhi
On the other hand the hybrid car mar-
ration model is making Indian IT compa- 2020.This would have required generating ket in India is moving upwards continuously
nies compete with global IT companies 1,000 MW from hydrogen which was being Way back in 2009 Gujarat Co-operative
over the past few years. Mahindra and Mahin-
rather than within themselves. considered as the fuel of the future. It was Milk Marketing Federation (GCMMF),
dra which gave India its first hybrid car, The
estimated that at least ` 240 billion would be Scorpio hybrid, in 2012, is planning to in- had chalked out a mission 2020, as part
required in order to create the infrastructure crease its production facility by opening a of which it aimed to increase the turn-
for hydrogen production, storage, transporta- new plant in Pune. The Indian Govt is also over of all the dairy co-operatives in Gu-
R-Power bags Hydel projects tion and distribution. Additionally, ` 10 bil- promoting this upcoming market by giving jarat to ` 27,000 crore by the year 2020.
worth ` 10000 crores lion will go in research and demonstration of huge subsidies. A lot of major players like However GCMMF, which owns and
technology. Hyundai and Honda are coming up with new markets world’s largest milk brand-
Bureau However RK Pachauri, the Nobel hybrid variants to attract the Indian customers Amul has performed even better than its
Laureate who was also the head of The and increase their market share. However cost own expectations and has achieved its
Reliance Power has bagged two hydroe- Energy Research Institute (formerly the Tata still remains a concern for the Indian car buy- mission 2020 even earlier than the start
lectric power projects of 1400 - Mw ca- Energy Research Institute) had rubbished the ers as these hybrid vehicles are still costlier of this New Year.
pacity worth over ` 10000 crores government roadmap at that time. Speaking to than normal vehicles. It has been able to achieve this
from the Assam government through a Economic Times in 2006, he had said, "I am by using relevant strategies in co-
competitive bidding process. amazed how a group of people like this can operative working, increasing productiv-
Bidders in the fray for the two projects ity of milk cattle, higher processing in-
included players such as Jaiprakash Hy- frastructure to handle peak milk procure-
dro Power, L&T and Athena Energy. Mahindra Reva launches Reva SGI- rides west in Style ment of around 200 lakh litres per day.
R-Power is the second-largest hydro- For increasing milk production, it is vital
power project developer in India after Mahindra Reva Electric Vehicle Company, the largest Electric car company in the world and to provide nutritious feed to milch ani-
State-run National Hydroelectric Power notable for manufacturing the world’s best selling electric vehicles is all set to make its mark mals, due to which the manufacturing
Corporation (NHPC). in the U.S. and European markets with the REVA sgi. The REVA sgi has an extremely aero- capacity of the cattle feed was expanded
R-Power is currently implementing four dynamic shape, a top speed of 180 km per hour, and a range of 200 km at a speed of 60 km by more than four times, to 12,000 MTs
hydro projects worth 1,200 Mw Kalai-II, per hour between charges. It uses lithium-ion batteries, which weigh about one-third as much per day, during the past decade. The
500 Mw Emni, 420 Mw Amulin and 400 as lead-acid batteries. This comes as a response to the success of the REVA NXG the prede- processing capacity of Amul’s dairy
Mw Mihudon in Arunachal Pradesh. cessor of the REVA sgi, which remains to be most popular car by sales in the Electric passen- plants was also doubled to 20.7 million
“We have bagged two new hydro projects ger car category. kg per day. This included multi-fold ca-
for generating 1400 Mw and will imple- M &M, the country’s largest utility vehicle company acquired Reva in 2010, adding pacity expansion for major product cate-
ment these projects during the 13th Plan passenger cars to the auto major’s electric vehicle portfolio. The Management has been mak- gories including milk powders, Ice-
period from 2017 to 2022. These are Run- ing huge investments in R and D and has been taking sales network of the Mahindra Group cream, paneer, cheese, ethnic sweets,
off-River (RoR) projects where in the across the country and overseas markets like Chile, Brazil, Italy, Spain, France and South Af- curd, ghee and other dairy products. A
cascading water of the river is diverted rica. special emphasis was also given to cap-
through a tunnel and is used to run the Mahindra Reva which already has a installed capacity of 60,000 units in Bangalore is ture liquid milk market of major metro
turbines for generation of electricity, the in the process of setting up its fourth manufacturing unit with an annual capacity of 50,000 cities, said an official statement released
construction expenses are less when com- units. By 2030, the country’s electric vehicle market is expected to see a sales of around after the annual general meeting (AGM)
pared with reservoir-type hydro projects,” 160,000-180,000 units per annum out of which about 110,000 units would come from the of GCMMF. The total investment in this
said a Reliance Power spokesperson. Mahindra stable alone. Petrol-fuelled vehicles still remain the key competitor of alternative- plan stood at US $ 26 billion for the last
fuel cars. However with government subsidies on green vehicles and increased efficiency of decade.
batteries the next generation electric cars are here to stay.
COMMODITIES
4 THE ECONOMIC TIMES THURSDAY 2 JANUARY 2020

certain substances into food grains and


Silver prices soar past Gold Onions to stay crops which drastically reduce their me-
younger tabolism rate, thereby keeping it fit for
consumption for about twice as much time
period as before. This comes as a respite
for farmers and distributors across the na-
The Anti aging technology has finally tion. Food productivity had grown by leaps
been approved by the Agricultural Minis- and bounds in the past few years and the
try. The decision to go ahead was taken in growing concern was the ability feed the
a joint meeting of the members on population within the life span of the
Wednesday. This technology would enable crops. Certain methods used for production
farmers to keep food grains and crops fresh is based on the theory of producing large
for a much longer period of time. amounts of crops in a very short amount of
The technology was under time. This posed a problem
the scanner for quite some of storage and distribution
period of time, with cer- since production may not be
After more than a year of price battles among the two dearest rare metals of the planet, tain researches suggesting in sync with the consump-
Silver has finally done the impossible. Silver prices, for the first time in history have gone that foreign substances tion. This is when it became
past gold prices with its price reaching an astronomical $2354 an ounce. This price is mar- used in the technology imperative to make the edi-
ginally more than that of Gold which stands at $ 2351 for an ounce as on Wednesday. would decrease the nutri- ble life of crops more than
This price shift has, for a long time, been coming owing to the fact that the con- tional value of crops. Cer- what it normally is.
sumption of silver in the last few years has far exceeded the capacity of the planet to pro- tain other reports did not The Agricultural Ministry
vide it. So much so that silver stands to be the first element in the periodic table to be ex- rule out the possibility of has assured that the anti ag-
tinct. Scientists predict that the total reserves of silver on earth would not last beyond cancer causing agents in ing technology would be
2025. Silver follows the path of Rhodium whose price went from $ 300 to $ 10000 in a some of these products. A thorough re- made available to farmers across the nation
very short span of time earlier in the century. search over the past six months have dis- within the next few weeks. It could be pro-
On the 21st of August, 2019 it was officially reported that the ratio of silver to gold missed all the allegations and has proved cured from all post offices in rural areas
had gone down to below one from being about 14 less than a decade ago. The current trend that the artificially treated crops would and subsidized prices. Also there are plans
suggests that silver prices would keep on increasing with no apparent respite in the near indeed stay fresh for a longer duration to conduct workshops at a national level
future. Prices of silver are expected to reach $ 2800 an ounce by the end of this year. without any loss of quality or health haz- thus leveraging the mass communication
PTI ards. This was confirmed by the Research via virtual classrooms provided by e-
and Development team of the Department choupals across the nation.
of Agriculture, India.
The technology is based on the injection of

Technologies that changed Indian Agriculture Scenario

The labour force employed by Agriculture better or the signalling of famine with the
sector has dropped from 56% to 35% in the help of Demand-Supply projection helped
Last Decade but its contribution to the GDP the crop resource system to manage the de-
had reduced only from 18% to 16% because mand -supply of crops region ways.
of one and only reason Technology. The Another Significant improvement
Last Decade has witnessed a big impact of was the water management for Irrigation
technology in agriculture in diverse ways. purpose. With the Phase 1 of all River Join-
The focus areas where crop diversification, ing Project completed some region are now
Water Management, Organic farming, covered in the water management. For e.g.
agri-clinics, Bio-technology, Crop resource regions like Andhra Pradesh which are
system. prone to famine and less rain are now con-
Bio Technology along with Organic nected in the all river project. With the help
fertilizer was probably the most prominent of Early Warning System the region author-
revolution after the green revolution. The ity now had option of diverting some water
usage of genetic crops (which started as Bt in to store in the reservoir to protect the
Cotton in 2009 and extend to most of the fields getting affected from famine. As a
food crops) along with its organic fertilizer result of this the total systematic irrigated
was the shot in the arms which the Indian area stands around 297 M.H (88.9% of the
agriculture wanted. What this did was one, it total 340 M.H) as compared to 60 M.H a
increased yield per hectare of the crops from decade ago.
around 2 tonne/hectare to 4.1Kg/Hectare Another shift caused by technology
and reduced average quantity of fertilizer is the average hectare per farmer has in- Dr. APJ Abdul Kalam
needed thereby reducing the cost of the as- creased by more than 100% from 0.2 hectare
sociated with it. No to mention the advan- per person to around 0.5 hectare person as
tage organic fertilizer had on the Soil ero- the using technology for a small farm be- Economic Times salutes the Man behind the
comes an unsustainable large overhead.
sion and environment hazard which were
Thus, in the last decade small scale farmer vision of India 2020
caused by its predecessor.
Disaster Management system was have been on the decline as they end up
another booster which incorporated early merging with the medium or large scale
warning system; water management crop which can be issue in the long run of cartel
resource system and Demand supply projec- being formed for each region or each crop.
tion. What it did was diversified the risk of a
former to a certain extent. The early warning
system which warned the state or region of
the coming flood helped the region prepare
ECONOMY, FINANCE & MARKETS
SENSEX : 43723.00 | NIFTY : 13174.04 | DOW: 32678 | THE ECONOMIC TIMES THURSDAY 2 JANUARY 2020
5
Rupee ends at 32.23/24
against Dollar Sensex dips 126 pts on profit-booking TODAY’s Bets
. Our Bureau . . By Purnendu . of its sales in Europe and South America slid
NEW DELHI the most and came down to INR 1600. On the Nifty range bound at
other hand the shares of TCS, the fourth larg-
THE Bombay Stock Exchanges (BSE) bench- est Software Company in the world, rallied on 12700-13400
mark index Sensex closed 0.3% lower on reports of strong Q3 earnings and closed at
Tuesday, ending a two weeks rally as investors INR 8000. The Nifty witnesses rollover of 37% as Janu-
booked profit ahead of the announcement of Fitch increased it long-term credit rat- ary contracts are trading at a premium of 6
GDP figures of the United States. ing on Yes Bank, while Standard & Poor points, indicating long rollover to January
NEW DELHI The 50 share barometer of the BSE, slashed Saudi Arab’s economic growth fore- series. Most of the large major stocks have
which rallied over 600 points to settle at its cast. “The middle east is still a concern”, said seen good rollover with a positive cost of
The rupee rose more than 1% highest level in more than two months on Rajiv Mundra, vice-president of Standard &
on Tuesday, as the Yuan’s as- carry, indicating long carry forward to Janu-
Monday, witnessed profit- booking in banking, Poor. “There is no tearing hurry to be bullish ary series.
cent against the Dollar triggered metal and IT stocks to finish the trade at on Middle East as the numbers look
selling in the US currency by The Nifty initially gained due to short cover-
43723.20 points, down 131.2 points from stretched.” He advised investors to avoid ing, but witnessed fresh buying later. The
importers. 43854.00 of Monday, 31st Dec 2019. The bell- shares in Oil companies.
The partially convertible January series witnessed a rally of nearly 800
wether opened on a weak note, tracking global Top lender State Bank of India (SBI) dropped points due to overall positive sentiments,
rupee ended at 32.23/24 per cues. During the markets, the Sensex touched 0.2% while leading private sector lenders
dollar, about 1% stronger than from a low of 12700 to the highs of 13210
a low of 43763.67 points but ended above that ICICI Bank and HDFC Bank lost 0.22% and levels. Options
its Tuesday close of 31.91/92 level. 0.29%, respectively. Mortgage lender HDFC concentration has
when it had climbed as high as Likewise, the Nifty index of the National declined 0.4%. F&O
31.99 during trade, its strongest shifted to the
since November.
Stock Exchange (NSE) ended 0.27% lower at The Sensex has outperformed broader TRACKER 12700-strike put
13174.04 points. indices so far this year. It climbed 4.5% this option with an
“How the rupee trades to- The fall comes over waning excitement over
morrow will be mostly depend- month through Monday as investors bought open interest of above 120 lakh shares in
Russia moving towards limited float of its cur- January, closely followed by the 13400
ent on mostly where the Euro rency that would allow it to appreciate against shares in companies that will benefit from ex-
and Yuan are against the dollar. panding domestic demand. Metals makers ral- strike call option with above 110 lakh shares
the US Dollar. in the December expiry.
But I see a range of 32.20 to NTPC, the Power major declined by lied in line with regional peers, while hopes of
32.30”, said a senior dealer This options concentration suggests
2.3% amidst concern over the inventory levels robust domestic corporate earnings also helped the near term range of 12700 to 13400. How-
with a foreign bank. in its coal powered plants. Tanla Solutions, the sentiment. ever there are more put writing than the call
leader in Telecom solutions that gets one-fifth writing which indicates bullish sentiments.
Implied volatility of the index has shown a
downward trend.
India hopes to
maintain double digit
Indian Railways Cargo Division IPO
growth in 2020-21 may happen next fiscal
. Bureau .
1 Jan 2020, 1433 hrs IST,PTI "The company's financials are doing
MOSCOW NEW DELHI: The government on Wednes- pretty badly and it certainly shouldn't be so
day mulled poor financial performance of because cargo transport as you know it is
The Indian economy, World’s Indian Railways Cargo Division and made a one of the sectors that you have to be com-
case for disinvestment in PSU behemoth petitive and they (IR) have to pull up," WHAT TO
fourth largest after US, China
and Japan, is confident of main- through an initial public offer. WATCH OUT FOR
taining the double digit growth The government may announce a
rate in 2020-21, said trade min- "I hope Indian Railways (IR) IPO roadmap for disinvestment in PSUs through
ister Jyotiraditya Scindhia on happens in the coming year (2020-21). I IPOs and follow-on public offer (FPOs) by  GATEWAY DISTRIPARK: Will
Tuesday during a visit to Russia. can't say exactly when, but I certainly hope March this year and IR announce dividend and audited results.
“We hope to grow at the robust that it does happen Cargo could be one of  DCB: Will announce consolidated
rate between 12% to 13% this because IR does need the PSUs out of 50 audited results
year and we are optimistic, to open up to public companies identified by  NHPC: Will announce dividend and
rather confident, that we will ownership primarily the government. bonus
maintain India’s double digit with a view to
growth rate”, he told during a strengthen its own Indian Rail-
business conference in Moscow. management and its ways, which was eye- WORLD
“We have the largest accountability," Dis- ing a top slot in the
middle class in the world, equal investment Secretary cargo market at one
Sunil Mitra told news  US: The Federal Open Market com-
to the population of all of point of time, is strug-
c h a n n e l . mittee, which sets interest rates, will
Europe combined together, the gling to retain its posi-
The PSU has meet. The committee is unlikely to
demand for goods will keep tion.
been negotiating with raise the rates.
driving the growth”, he added. .
the adamant trade unions, which have been  EU: The EU members will meet in
The company is also in process to
opposing any disinvestment as they (unions) Vienna to discuss the EU constitution
add specially designed cargo trains at an
SENSEX feel that it (disinvestment or listing) will investment of over ` 35,000 crore and had
and amendments.
serve no interests of the people.  China: Considering its outsourcing
floated the tender nearly 18 months ago but
policy due to concerns being raised
being a government-owned company it has
43849 The government had earlier pro- over increasing unemployment.
been facing bureaucratic hurdles to place
SENSEX

posed to divest 5 per cent stake in the PSU orders with the lowest bidders.
43723 and the same was felt at a recent review Disinvestment and listing would
meeting chaired by Prime Minister Rahul help the PSU to take decisions faster and
G a n d h i . compete with the competitive road cargo
companies. effectively and efficiently.
9 AM 4 PM
INTERNATIONAL
6 THE ECONOMIC TIMES THURSDAY 2 JANUARY 2020

European Union: Reshaping Lisbon Strategy The Slide of $


Indian Rupee has shown dramatic appreciation over
By Rachna Saini years will bring more dynamic reforms its economic stability back with less ef- the past few years. If you look back, around a decade
Special Correspondent for EU. forts. back, a dollar would hover around somewhere close
Such measures are still under considera- to half a cent of the INR and was moving in only one
The downfall of the Greek economy in Lisbon strategy had failed to provide dis- tion. direction, from strength to strength. Contrast this with
the year 2010 was a warning bell for ciplined and rigorous monitoring proce- Another major reform would be the the fact that the rupee breached the psychological
European Union to revise its policies and dures, and major groundwork has been removal of restrictions on free labor 32.23 INR/USD mark last week and a trend is ob-
to move towards a well defined and ro- done on the same in last 5 years which movement across the borders; some served; USD is weakening and that too very sharply.
bust economic structure. Strict measures will be implemented in the forthcoming countries like Germany have been resis- Right from the day the Bretton Woods Agree-
like a decrease in the minimum support years, followed by the formation of a tant to the free movement of labor ment was signed in 1944, the dollar has been the most
wage, increased taxes etc were adopted central authority which would be respon- The increasing span of Eurozone and in- trusted currency and has been heavily relied upon for
alongside the mammoth bail-out pack- sible for all the financial and other deals ternational trade demands necessitate an maintenance of forex coffers by a huge majority of
ages which were made available to pull it involving the countries of Eurozone. immediate abolition of all such restric- nations across the globe. With an already weakening
out of the economic pit it had gotten into. Policies will be carved out that will make tions. economy and an interest rate cut by 100 basis points
This crisis had put a big question mark it mandatory for the member countries to Targets have also been set for more effi- by the Fed, USD has dropped even further against
on EU’s financial capabilities. contribute to the funding decisions of any cient conservation of the environment, the other world currencies like Rupee, Yuan, and
It was the first time that the countries of economy facing a financial crisis. and to increase the use of green re- Euro. The dollar ended the last week at all time low
Eurozone had come together to bailout a sources. Agricultural reforms are also an against the Indian Rupee at ` 32.23 / dollar which
member nation. But the lurking danger Lisbon policy does not have a clause agenda on the list. Europe has been reluc- means a fall by almost 50% over a decade.
to the Eurozone could be well anticipated which can enable a member country to tant to allow the farming of genetically The reasons are quite obvious for this down-
due the lackluster economic policies of separate itself from Eurozone when modified crops, which has been responsi- fall. The monopoly of US dollar became a reason for
the EU and the existent economic crisis some deep financial crisis occurs. Coun- ble for low returns in the agricultural sec- its downfall as well as the downfall of US economy.
in the world. The vulnerable condition tries like Greece ,have faced the conse- tor. But the success of genetically modi- In the last 20 years , the US financial hegemony was
had demanded major economic reforms quences of such inflexibilities because fied crops in many major countries has responsible to keep the US economy booming but this
which, alas, never came by. given that at the time of Greece crisis in raised the concern to allow the same in had put the entire world into a race to produce items
Lisbon strategy (formulated in the year year 2010, Greece could separate itself Europe. It would be a big revolution in to export to US market, so that they could earn US
2000), which majorly determined the and introduce a new currency which the field of agriculture and assures in- dollars which could enable them to trade world wide
EU’s policies, has largely been reshaped could be devaluated to attract foreign creased strength to European economy. and pay their debts .This had an adverse effect on the
in the last 10 years. The forthcoming investment then the country could regain domestic markets of these developing countries and
as well as US economy in a long run because it ended
up being a consumer for the whole world which
pushed US into a debt bubble .
India & China sign historic agreement Countries like India and China are driven by
domestic demand and consumption and hence were
The BRIC summit ended in Ahmedabad with India the fourth largest economy at $4 not highly correlated to US downfall and economic
a landmark trade agreement which will open trillion. downturn due to which they were able to sustain their
borders between India and China for the first The largest economy in the world growth in last decade. Increasing trade between India
time in modern history, resulting in the largest that of the United States is worth about $15 and China due to Indian automobile and iron ore and
free trade zone in the world. China and India trillion. The agreement removes considerable steel exports to China and India’s increasing opportu-
together form the largest economy in the taxes and legal restrictions levied on almost nities to pounce on Chinese markets due to China’s
world, a result of rapid and sustained growth. all trade, save on certain sections of the agri- increasing technological saturation in the last 5 years
The new agreement will effectively cultural products market. The most signifi- has lead India on a path of progress.
change the way the world works. Roughly cant of the changes comes in the manufactur- Also, Indian companies have been fast to rec-
65% of the population of BRIC nations is now ing and IT sectors, with both countries agree- ognize the increasing power at the hands of the bot-
between the ages of 15-60 (working age popu- ing to lift restrictions on businesses from ei- tom the pyramid markets Also, the efforts by the GoI
lation). India’s and Brazil’s working age ther nation setting up shop within the others’ to develop local markets has paid rich dividends. A lot
population is projected to increase until about borders. With China expected to become the of schemes like “Plan Rural India” and “Bharat
2030. In contrast, the working age population of the G6 coun- world’s largest economy by 2030, and with India expected to Swayamnirbhar”, aimed at rural development have
tries stands today at about 55% and declining. China is today sustain its current growth rate of 6% for the foreseeable future, helped develop the domestic markets . And a lot of
the second largest economy in the world at $12 trillion, and things can only get better for the two Asian giants. nimble-footed Indian companies moved in the fraction
of a second to cater to the demand created by
strengthening hands of the bottom of the pyramid.
Next Copenhagen: Bio-fuels posing threat The major question in the year 2020 would be
whether India would be affected by weakening dol-
lar in a negative or positive manner .This news might
Bureau and carbon dioxide into lipids and oils planet. Upcoming UN meet will address be good for importers in the country but the exporter-
that can be sent to refinery to convert to this issue and come up with a construc- sector would be badly hit. The IT sector, being one of
17th July 2020,the UN summit will diesel and other fuels. Biological and tive solution to the problem.193 coun- the major exporters, is naturally concerned and are
genetic engineering techniques have tries all over the world would participate taking steps. Companies like Infosys are trying to
again be held at Copenhagen to discuss
been used to improve the functioning of in the meeting to come up with the solu- mitigate this risk in all their contracts with the Ameri-
the climate issues but with a different
algae. The method has been used at a tion. can clients by quoting the estimates in Euros .It will
set of problems. The last summit that
large scale in last five years for fuel pro- The outcome of the conference not be possible to maintain the margins of the com-
was held in Copenhagen was in year
duction. The method is ten times more would decide the fate of companies like pany if the trend continues. This southward movement
2009 where the major issue was to re-
efficient than soyabean used to make Synthetic Geonomics, Sapphire Energy of the dollar might force some of the IT companies to
duce the emission of Greenhouse gases.
biodiesels and corn used to make etha- etc who are a major producer of bio- cut costs which may mean smaller pay packages for
The Copenhagen Climate Committee
nol. fuels in the world and are tied up with the IT professionals and most of the offshoring con-
protocol was established in 2007 under
There is a flip side to the coin huge contracts with industries. In last tracts moving to countries like China and Vietnam. As
the Kyoto Protocol with an agenda of
too. The excessive use of technology has few years, there has been an increasing indicated by Finance minister , countries exports and
conservation of the environment. But the
led to genetic modification of the algae dependence on such companies for fuel tax revenues will be suffering a huge hit due to the
steps needed to check the degradation of
and this has started to have an inverse requirements and this has also given a local currency appreciating, tight monetary control
the environment are bound to pose a
impact on climate. Considering that al- boom to the energy sector which has would be administered to protect the interests of the
challenge to the industrial progress, es-
gae are responsible for producing much become an increasing contributor to the Indian exporters.
pecially for the developing countries.
of the oxygen on the planet and that they GDP of host countries. A mix of best policies would be needed to
The above treaty had triggered
are a crucial part of the marine food If the threat posed to the envi- maintain the balance between imports and ex-
an increasing scramble to develop bio-
chain, this needs to be taken very seri- ronment is a serious one, then the world ports .India needs to work more to develop its domes-
fuels which could substitute the pollu-
ously. Experiments have shown the would see an Energy bubble getting tic markets. The future of Indian economy should not
tion-causing petroleum products and
changing levels of oxygen in the atmos- burst in the next decade, which would suffer the same misfortune as US economy .This
coal. One of the major successes has
phere which is an issue of grave concern again bring the major economies in a would largely depend on the monetary policies regu-
been the use of algae to produce bio-
and cannot be taken lightly as the altered vulnerable situation. Till then, let us all lating the money supplies.
fuels; a genetically modified form of
oxygen supply would endanger the exis- keep our fingers crossed and hope for Next year should play a crucial role to pro-
algae called “Superalgae” which is
tence of all the species on the face of the the best. gress India on the path of being a developed Nation.
highly efficient in converting sunlight