Continuous growth is a fanciful dream, continual growth farce and impression of growth the truth--Anonymous
Mooody's Analytics downgrading India's growth projections for the year at 5.5% attributed to turbulent global conditions, policy mis-steps and poor monsoons; investors could see a pall of gloom.
But the growth as registered by India in itself is a cause of cheer. It may not be party time yet; still something to be hopeful of. In Europe recession has set in and Britain and France have been officially in recession. Economic activity has almost come to a stand still in Greece and Southern Europe. Germany is on the brink and there are wide-spread fears that the leviathan anchor that is the crisis, would drag the Euro ship down to the fathoms.
“I believe a 6% growth figure for India would in itself be difficult to achieve...”, said Martin Patrick a Kochi based economist reacting to the Moody's report.
“And for next year, the maximum possible growth rate would be to the tune of 7%” he conveyed.
“But prediction is very difficult as unexpected and unanticipated things are happening in the global markets. It will be 2014 until some assessments could be made and confident conclusions derived.” he hastened to add.
Other emerging markets like Brazil, Russia and South Africa would also continue with limping growth.
“However, China would continue to excel India. They have good dollar reserves, a strong domestic economy and versatile exports. The economy is pretty much diversified with agriculture and manufacturing faring on a robust note.” Martin Patrick added.
But there are contrary views.
China's July exports have picked up just 1%. from a year earlier.
"China will not escape from the global slowdown," Banny Lam, China economist at CCB International in Hong Kong was quoted by Reuters as saying. He is expecting Chinese government to free the cash reserves that banks should hold, so that additional boost would be provided to the economy.
Yesterday, there had been reports that China had pumped up investments in the railway sector.
Chinese government has quietly pumped up its investments in railway sector outlaying funds to the tune of CNY470 billion for July. This is when compared to CNY406 billion stated in a June prospectus of Chinabond, official website of China's debt issues.
The news created positive sentiments in the copper market.
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