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Business News/ Mint-lounge / Mint-on-sunday/  GDP growth slows, millions on strike and El Nino strengthens
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GDP growth slows, millions on strike and El Nino strengthens

Economy grows 7% in June quarter; 150 million workers protest against labour reforms; El Nino declared strongest since 1997-98

Photo: Ramesh Pathania/MintPremium
Photo: Ramesh Pathania/Mint

1. Indian economy grows 7% in Q1

India’s economy recorded a slower pace of growth in the first quarter of 2015-16, compared with the previous three months, setting the stage for a rate cut by the Reserve Bank of India. However, the pace of growth depends on whether one looks at gross domestic product (GDP) at market prices or at gross value added (GVA). Taking GDP at market prices (constant prices), the economy grew at 7%, down from 7.5% in the previous quarter, indicating that the economy is decelerating. In the case of GVA, economic growth has picked up sharply from 6.1% in the fourth quarter of 2014-15 to 7.1% in the quarter ended June. The data comes soon after RBI governor Raghuram Rajan signalled that the central bank has not ruled out another rate cut.

2. DLF, GIC in JV for two projects

DLF Home Developers Ltd, a subsidiary of DLF Ltd, and Government of Singapore Investment Corp. (GIC) have entered into a joint venture to invest in two upcoming projects in Delhi. GIC will invest about Rs1,990 crore and DLF will develop the projects. With the realty firm struggling to reduce its debt, the investment is in line with DLF’s plan to sell its stake in various projects and bring in private equity investors. GIC has been an active investor in Indian real estate in recent times. In 2014, realty firm Brigade Enterprises Ltd and GIC entered into a JV to invest in and acquire land for residential and mixed-use developments in south India.

3. India risks deflation: Subramanian

Arvind Subramanian, chief economic adviser (CEA) to the finance ministry, on Wednesday said India is at a risk of deflation, even as he expressed confidence that the economy will grow at around 8% in 2015-16, as estimated in the Economic Survey. Subramanian has long stressed on the point that the central bank should look at both the Wholesale Price Index and the Consumer Price Index for deciding rate cuts instead of just focusing on the latter. RBI maintained status quo in its August monetary policy review, choosing to closely watch inflationary expectations on account of an uncertain monsoon.

4. Govt exempts foreign investors from MAT

In line with the recommendations of the A.P. Shah committee, the government on Tuesday announced that it would spare foreign portfolio investors (FPI) from minimum alternate tax (MAT) for the years prior to 1 April, thus aiming to settle the row with overseas funds concerned about backdated tax demands. Finance minister Arun Jaitley said the government will introduce clarificatory amendments to the Income Tax Act to exempt FPIs from MAT in the next session of Parliament. The tax department will also issue a circular to its field formations to put on hold all existing demands as well as any new demands. The government’s acceptance of the recommendations should reassure FPIs who have strongly opposed MAT demands.

5. Zomato buys stakes in Grab and Pickingo

Restaurant search and review website Zomato has bought minority stakes in hyperlocal delivery companies Grab and Pickingo in a bid to strengthen its food ordering business. While it did not disclose the financial details of the transaction, Zomato co-founder and chief executive Deepinder Goyal said the company has taken high single-digit stakes in Grab and Pickingo. Zomato has also tied up with logistics firm Delhivery to help in last-mile delivery of food from restaurants. The move will help Zomato bring restaurants that typically do not deliver food online on Zomato Order. Initially, the services will be available in five cities—New Delhi and its suburbs, Mumbai, Bengaluru, Hyderabad and Pune.

6. El Nino strongest since 1997-98

The Australian Bureau of Meteorology on Tuesday said that the 2015 El Nino is now the strongest since 1997-98. The temperature anomalies in the tropical Pacific Ocean remain a little over half a degree below the peak observed during 1997-98, the bureau said in its update. The strengthening El Nino was one of the primary reasons for the forecast of a deficient monsoon this year by the India Meteorological Department. As of Friday, 42% of the country is rainfall deficient, while the overall monsoon deficit has widened to 13% of the long-period average. There is a more than 90% chance that El Nino will continue through winter 2015-16, according to the US National Oceanic and Atmospheric Administration.

7. 150 million workers go on strike

Some 150 million workers went on a day-long strike opposing the central government’s labour reforms and demanding higher wages, social security, withdrawal of labour law amendments and an end to privatization of public sector companies, among other things. Ten central trade unions, including the Centre of Indian Trade Unions, the All India Central Council of Trade Unions, the Indian National Trade Union Congress and the Hind Mazdoor Sabha had given the strike call along with their supporters and state labour unions. Industry lobby group Assocham estimated the loss due to the strike at Rs25,000 crore. Many industrial and commercial establishments preferred to shut their units because of fear of vandalism by trade union leaders and their supporters.

8. Manipur violence disrupts normal life

Violence at the town of Churachandpur in Manipur on Monday killed five people and injured 27 during a 12-hour bandh called by tribal student organizations in protest against three bills passed by the state assembly. The activists of the student organizations were protesting against the passage of bills to protect the indigenous people of Manipur, which include the Protection of Manipur People Bill, 2015, Manipur Land Revenue and Land Reforms (Seventh Amendment Bill), 2015, and Manipur Shops and Establishments (Second Amendment) Bill, 2015.

9. India wins Test series in Sri Lanka after 22 years

India won its first Test series in Sri Lanka after 22 years, defeating the host nation by 117 runs in the third Test. India hadn’t won a series in Sri Lanka since 1993 under captain Mohammad Azharuddin. Cheteshwar Pujara was named the man of the match for his unbeaten 145 in India’s first innings and Ravichandran Ashwin was adjudged the man of the series. Sri Lanka won the first Test in Galle by 63 runs and India won the second by 278 runs. Former Sri Lankan captain Marvan Atapattu resigned from the post of chief coach of the national cricket team on Thursday following the loss.

10. Jet Airways to merge Jet Lite with itself

The country’s largest airline by passengers carried will merge its wholly owned unit Jet Lite (India) Ltd with itself. After the merger, Jet Lite will operate as a separate division of Jet Airways. It will further strengthen Jet Airways’ efforts to provide consistent services under a single brand across its network, leading to a stronger market presence, the airline said in a statement. The merger, however, will not lead to the airlines surrendering its permit to operate in India. According to a Jet Airways executive, the airline will continue to have two separate air operating permits for flying in India—one each for Jet Airways and Jet Lite.

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Published: 05 Sep 2015, 11:21 PM IST
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