Ups and Downs
INDIA’S ECONOMIC growth rate slowed to 6.3% in the September quarter as the manufacturing sector faced a contraction, data released on Wednesday showed. The 13.5% GDP growth in the June quarter had been due to a low base. In absolute terms, the first half of the fiscal year (April to September) had a GDP higher than the pre-pandemic level (April-September 2019) for the first time, but it was only 5.7% up over the three-year period due to lockdown-related disruptions in the intervening years.
Tata’s Skies
THE TATA Group on Tuesday said it would merge Air India and Vistara, with partner Singapore Airlines holding 25.1% of the merged entity. The Tata group will own the remaining 74.9% stake. Once the merger goes through—likely by March 2024—the consolidated Air India will have a combined fleet of 218 aircraft. By market share, the constituents together had 25.9% domestic passengers in October. Both figures are second only to IndiGo, and could offer a challenge to the market leader.
Xi’s Challenge
THAT’S ROUGHLY the number of cities in China facing covid-19 outbreaks, up from 50 earlier this year, according to The New York Times. The country is witnessing massive protests calling for President Xi Jinping’s resignation over his zero-covid policy. The policy hasn’t worked in curbing infections but has led to hardship caused by lockdowns in some of China’s biggest cities. Blank sheets of paper have emerged as a popular protest tool against the regime.
Social Fissures
A NEW report by Pew Research Center placed India on top in its list of countries with the worst rates of social tensions along religious lines in 2020. At 9.4 out of 10, India’s Social Hostilities Index was worse than neighbouring Pakistan and Afghanistan, and an increase in its own index value for 2019. A higher score is worse. On another metric, reflecting government curbs on faith, India did better, ranking the 34th worst among 198 countries.
Debt Pressure
HARDENING INTEREST rates and rising input cost pressures have taken a toll on the debt servicing capacity of companies. The interest coverage ratio of listed companies declined for the first time in three years in the first half of FY23, showed a Mint analysis of 2,178 non-finance companies. The ratio declined to 6.1, that is, the combined operating profits of the companies were 6.1 times their interest expenses. The figure was at an 11-year high of 7.1 in April-September of 2021.
Bull March
THAT’S THE all-time closing high hit by the BSE Sensex on Thursday. This was the eighth straight session the share index gained. The benchmark index crossed the 63,000 mark for the first time on Wednesday ahead of a meeting of the US Federal Reserve and the release of India’s quarterly GDP data. The Sensex has now recouped losses it had made earlier this year, and has gone past the previous peak of October 2021. It had fallen to a low of 50,921 points in June.
Digital Tender
THE RESERVE Bank of India (RBI) launched the digital rupee, or e-rupee, for retail use (e ₹-R) in a pilot exercise on Thursday. RBI has picked four banks— State Bank of India, ICICI Bank, Yes Bank, and IDFC First Bank—to participate in the first phase of the pilot to be run in four cities. Eleven countries have already launched their central bank digital currencies so far, and 15 were piloting the same before India, according to a tracker run by the Atlantic Council.
Chart of the Week: India’s Turn
INDIA ON Thursday took over the presidency of the G20, which will culminate in a summit in New Delhi next September. The G20 has great disparity: the US’ per capita income is 32 times that of India’s. India and Indonesia are the only lower middle income members.
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(Curated by Tanay Sukumar)
