Dear Mem­ber,

Assocham Bulletin - - ASSOCHAM -

It was en­cour­ag­ing to know that In­dus­trial pro­duc­tion grew faster than 7% for the fourth month run­ning in Fe­bru­ary while con­sumer in­fla­tion mod­er­ated to a five-month low in March, pro­vid­ing a dou­ble boost for the econ­omy and the govern­ment. High in­dus­trial growth sug­gests a strength­en­ing eco­nomic re­cov­ery while lower in­fla­tion re­duces the chances of the Re­serve Bank of In­dia rais­ing in­ter­est rates soon.

In­dus­trial out­put as mea­sured by the in­dex of in­dus­trial pro­duc­tion (IIP) rose 7.1% in Fe­bru­ary while the Con­sumer Price In­dex (CPI) showed re­tail in­fla­tion at 4.28% in March, the fourth suc­ces­sive month of de­cline. With IIP growth ex­ceed­ing 7% for Jan­uary-Fe­bru­ary 2018, the out­look for the GVA (Gross Value Added) growth for Q4 FY2018 has be­come brighter.

As ex­pected, RBIGover­nor left all key rates un­changed. It is im­per­a­tive in the global sce­nario to hold the horses of re­ac­tion to rates. Two con­ti­nents are go­ing to tighten the econ­omy, in that sit­u­a­tion to keep sta­tus quo is the best way, and ob­serve the changes. From the In­dian con­text, we are at a rea­son­ably good base rate and fi­nan­cial sec­tor is now pass­ing on the ben­e­fits of lower rates slowly, in the econ­omy. Econ­omy is pro­jected to ac­cel­er­ate to 7.4% in FY19 from 6.6% in FY18 while the quar­terly re­tail in­fla­tion is forecast at a max­i­mum 4.7% in the next fis­cal. Higher crude prices and threats to ex­ports from dis­rup­tions in global trade are new risks to growth.

Top-gear growth in sales of cars and SUVs has led to In­dia be­com­ing the fourth largest pas­sen­ger ve­hi­cle (PV) mar­ket glob­ally for the first time ever, un­seat­ing Ger­many. As a re­sult, In­dia is now be­hind China, US and Ja­pan in the global peck­ing or­der with Ger­many in the fifth po­si­tion, fol­lowed by Brazil and France. The PV mar­ket is ex­pected to wit­ness 8-10% growth in FY18, helped by new model launches and fa­vor­able macroe­co­nomic en­vi­ron­ment, with GDP growth rate ex­pected to im­prove in the sec­ond half of FY18, and re­cov­ery in ru­ral in­come.

We Wel­come the RBI's move to ex­plore in­tro­duc­tion of an of­fi­cial vir­tual cur­rency in In­dia but ex­treme care be taken to en­sure safety of the data trail that crypto cur­rency trans­ac­tions can leave be­hind. Plac­ing a ban on all reg­u­lated en­ti­ties, in­clud­ing banks, from deal­ing in vir­tual cur­ren­cies like bit­coins, the Re­serve Bank of In­dia is ex­plor­ing a" fiat dig­i­tal cur­rency". Of course the in­ter-de­part­men­tal study group of the RBI­would ex­am­ine all the safety as­pects when it starts work­ing on ex­plo­ration of the crypto cur­rency which has been in­tro­duced by pri­vate par­ties in sev­eral parts of the world and has at­tracted a lot of at­ten­tion. A high level of co­or­di­na­tion among all the cen­tral banks would be re­quired along set­ting up some kind of a global over­sight to guard against mis­use of the new cur­rency by the anti-so­cial el­e­ments, ter­ror­ists, en­emy coun­tries

As­socham al­ways re­main in the fore­front to fa­cil­i­tate its mem­bers when it comes to the is­sues re­lated to the in­dus­try. Steel, Ce­ment, Min­ing, Power sec­tor are con­sid­ered to be the core in­dus­trial sec­tors to drive the eco­nomic growth of the na­tion. In­ci­den­tally, all th­ese in­dus­tries are heav­ily de­pen­dent on coal, which is ma­jor raw ma­te­rial for all th­ese sec­tors. AS­SOCHAM has or­ga­nized a round ta­ble meet­ing with Hon'ble Min­is­ter of Coal & Rail­ways Mr. Piyush Goyal, where se­nior of­fi­cials/ CEOs of many mem­ber com­pa­nies have in­ter­acted with the min­is­ter with their is­sues. The meet­ing was also at­tended by Chair­man Coal In­dia and Se­nior of­fi­cials of Coal min­istry. It was in­deed a very fruit­ful meet­ing and many is­sues were re­solved or promised to be re­solved soon by the Min­is­ter.

AS­SOCHAM con­grat­u­late all their mem­bers for adding yet another feather to their wings by lay­ing foun­da­tion stone for re­gional head­quar­ter in Mo­hali, Pun­jab to give its ser­vices more ef­fec­tively to the in­dus­try in the states like Hi­man­chal Pradesh, Pun­jab, Haryana, Ut­tarak­hand, J&K etc.

AS­SOCHAM has reg­is­tered a sig­nif­i­cant pres­ence in East Asia by open­ing its of­fice in Seoul, South Korea re­cently. This ini­tia­tive will help in AS­SOCHAM's en­gage­ment not only in South Korea but also in East Asian Re­gion .

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