News in Numbers, Mar 16, 2017: Snapped 👓

$2.3 billion

What is it? The amount State Bank of India, the country’s largest bank, plans to raise from capital market in the coming fiscal.

Why is it important? It will help the bank to increase its capital adequacy ratio from  13.73% at present. It will also help in providing for bad loans. State Bank’s gross NPAs (non performing assets, or bad loans) stands at 7.23% of its total loans. Its chairperson Arundhati Bhattacharya recently said that resolution of NPAs is one of the key near term challenges for the bank.

Tell me more: Bad loans is a broader problem in the country, and Indian banks need $90 billion to meet Basel III standards, according to rating agency Fitch.

 

Rs 200

What is it? The maximum a cinema theatre can charge per ticket in Karnataka.

Why is it important? In the neighbouring Tamil Nadu, movie ticket price is capped at Rs 120. It was not the only populist measure that Karnataka, which presented its budget on Wednesday, took from Tamil Nadu. The state will open 198 “Namma Canteens” in the Bengaluru to provide breakfast for Rs 5, and lunch and dinner for Rs 10, similar to the hugely popular Amma Unavagam, state subsidized canteens, in Tamil Nadu.

Tell me more:  The budget – which had a number of announcements aimed at improving infrastructure, access to finance and healthcare – also removed value-added tax on liquor.

 

$24.49 billion

What is it? India’s exports in February 2017.

Why is it important? It’s up 17.49% from same period last year. Imports went up 21.76% to $33.39 billion. The increase in trade comes at a time when there is widespread fear that the world is turning more protectionist, led by United States and Europe.

Tell me more: Trade deficit came down to $8.9 billion in February from a provisional $9.84 billion in January 2017. For the eleven months ending February trade deficit stood at $95.3 billion.

 

14%

What is it? India’s logistics cost as a percentage of GDP.

Why is it important? High logistics cost is an indicator of inefficiency, and erodes competitiveness of a country. Nitin Gadkari, Minister of Shipping, Road Transport & Highways, said the government wants to address it and has unveiled a plan that includes aviation as a part of multi-modal logistics hubs in India. The 400 regional airports that the government is setting up across the country will have cold storage and other logistics solutions to make the sector more efficient, he said.

Tell me more: The government expects 15 logistics parks to be set up in the next five years, as a part of the larger Make in India initiative.

 

$20.77

What is it? Share price of Snap, the company that runs Snapchat, at the close of Wednesday

Why is it important? Snap made its debut in the public market on March 2 at $24, and hit an intra-day high of $29.44 the next day. Its IPO was priced at $17, and its grand debut was seen as a reflection of the high valuation that the companies at the intersection of social, mobile and hardware commanded. However, many analysts believe that it’s over-priced, and see the decline that Snap saw in the four out of last five sessions as a necessary correction.

Tell me more: Snap’s market cap is at $24.06 billion. Unlike Facebook, which has users from across age groups, Snap appeals mainly to an younger audience. It had 161 million daily active users end of December.

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News in Numbers, Jan 13, 2017: Lucky seven for Tata?

30

What is it? The number of years Natarajan Chandrasekaran, CEO of Tata Consultancy Services (TCS), has worked in the company (his entire career).

Why is it important? Popularly known as ‘Chandra’, he was appointed as Tata Sons’ chairman on Thursday – the seventh chief of the holding company of the group.  The move is likely to end the uncertainty that gripped the $116-billion coffee-to-cars group present in around 100 businesses. Less than three months ago, the previous chairman Cyrus Mistry, whose tenure was the shortest in Tata Sons’ history, was ousted unceremoniously – this spiralled into one of the ugliest corporate spats in Indian history. Chandrasekaran was the unanimous choice of a five-member search committee set up in October, which was tasked to find the next head within four months.

Tell me more: Under Chandrasekaran’s leadership, the profits of TCS was up more than threefold to Rs 24,375 crore in 2015-16 from Rs 7,093 crore in 2009-2010. TCS accounts for 60% of the group’s market capitalization and contributes to around 70% of its revenue.

 

5.7%

What is it? The percentage by which Index of Industrial Production (IIP), which measures growth in mining, manufacturing and electricity, grew in November 2016.

Why is it important? This is the fastest pace in 13 months (likely aided by the positive base effect) and compares with a contraction of 1.3% in the previous month and a contraction of 3.4% in November 2015. Also, this is the first set of industrial activity figures released after the government’s decision to demonetise high-value currency notes in November. However, its impact was felt on consumer prices inflation, which grew by 3.41% in December compared to 3.63% in the previous month, recording the slowest pace since November 2014.

Tell me more: Manufacturing grew at 5.5% in November 2016 compared to a contraction of 4.6% in the same period a year ago while electricity and mining grew at 8.9% and 3.9% in November as against 0.7% and 1.7% respectively in the corresponding period the previous year.

 

34,500

What is it? The increase in India’s annual haj quota by Saudi Arabia to 170,520.

Why is it important? This is the highest increase in nearly three decades and has renewed the debate on Haj subsidy. The government has set up a six-member committee to examine the viability of the subsidy and to explore ways to make it economical even without the subsidy. The Supreme Court in 2012 had asked the government to see how this can be phased out in 10 years. The setting up of the committee comes at a time when Uttar Pradesh elections are round the corner – a state where Muslim voters have about 20% share in its population.

Tell me more: In 2016, about 99,903 people from 21 embarkation points across India went to Jeddah (Saudi Arabia) for haj through the Haj Committee of India while 36,000 went for their annual pilgrimage through private tour operators.

 

1.5%

What is it? The drop in the annual world food price index in 2016.

Why is it important? The world food price index, mapped since 1996, averaged 161.6 for the whole of 2016, falling for the fifth year in a row. Published by the United Nations Food and Agriculture Organisation (FAO), the index eased as promising harvests in staple cereals offset price rise in sugar and palm oil. Food price inflation softened despite the impact of adverse weather conditions such as El Niño (the occasional warming of waters in the central and eastern Pacific Ocean) on some crops like sugar.

Tell me more: Meat and dairy products also fell, and along with cereals fell by nearly 40% below their 2011 peak. But Abdolreza Abbassian, senior economist at FAO, warns, “Economic uncertainties, including movements in exchange rates, are likely to influence food markets even more so this year (2017).”

 

7.7%

What is it? China’s annual fall in exports in 2016.

Why is it important? China’s exports affect a large number of countries as it is the world’s largest trading nation. Its December exports fell by 6.1%, owing to slowing global demand. Declines were seen in electro-mechanical and labour-intensive goods. Later this year, China could see heavy tariffs on its goods levied by the US under its new administration, led by Donald Trump if he follows through his campaign promise.

Tell me more: China’s trade surplus stood at $40.82 billion as imports grew by 3.1% on demand for coal and iron ore, while its 2016 trade surplus was at $509.96 billion.

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A new airport ✈

News in Numbers – September 16

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22

What is it? The number of international airports in India, following the addition of Chandigarh to this list yesterday.

Why is it important? India is one of the fastest-growing markets in world aviation. The creation of new airport pairs, as is expected to happen with the Chandigarh airport in the international segment over time, is a big lever of passenger growth.

Tell me more: In 2013-14, the Chandigarh airport serviced 9,690 domestic flights and 10.50 lakh passengers. In terms of flights serviced, it was the sixth busiest in North India, after New Delhi Jaipur, Lucknow, Srinagar and Amritsar.

 

$ 21.51 billion

What is it? India’s exports in August, down 0.3% from August 2015. Imports declined by 14%, helping India to narrow the trade deficit.

Why is it important? The headline number masks the relatively better performance of the top 5 export groups, barring petroleum products. Non-petroleum exports increased by 1.79% in August 2016.

Tell me more: Imports declined sharply because of 78% dip in gold imports, partly aided by sharp dip in gold prices. Non-oil and non-gold imports- a proxy economic indicator – declined by 1.52%.

 

-3.4%

What is it? The drop in share price of Reliance Communications yesterday, a day after it announced the merger of its mobile wireless business with a smaller company, Aircel.

Why is it important? Along with sharing additional details on the merger, Reliance yesterday said it planned to raise $1 billion from outside investors. Meanwhile, rating agency Moody’s placed the company’s credit rating under “review for downgrade”.

Tell me more: Over much of its listing, the Reliance Communications stock has been a value destroyer: overall, it has depreciated 84% since debuting in March 2006.

 

22 million tonne

What is it? The expected production of pulses this year, up 33% from last year.

Why is it important? Pulses shortage and the resultant rise in prices have been among the biggest concerns of the government and policy makers over the last few months. The government has more than doubled its buffer stock of pulses, and warned that it would invoke essential commodities act to impose price control. Higher production would alleviate those concerns.

Tell me more: The rise in pulses production (and food grains in general) is expected on the back of normal monsoon this season, coming after two years of drought. The area under food grain cultivation has gone up by 5.3 million hectare.

 

30

What is it? The number of lives lost to Dengue and  Chikungunya in Delhi this year

Why is it important? Over 2800 people have been affected by these two diseases in the capital alone, raising questions about government’s ability to manage public health.   Across the country, the number of cases has crossed 12,000. Both viral diseases cause fatigue, fever and body pain, and can last a couple of weeks. Complications can lead to death.

Tell me more:  Both diseases have been causing concern to public health officials across the world. There is no specific treatment for either, and vaccines have caused their own problems. According to WHO, there are 390 million dengue infections per year, and the year 2016 saw five fold increase in reported Chikungunya cases

 

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India’s latest GDP Numbers: Five things you must know

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Growth has slowed down: Asia’s third largest economy grew at 7.1% in quarter ended June 2016. This is the slowest in five quarters, and much lower compared to 7.9% recorded in the preceding three months.

Manufacturing picks up, but corporate investment still down: Manufacturing registered 9.1% growth in first quarter of current fiscal, as compared to 7.3% in same quarter last year. So this alone contributed one-fifth of India’s GDP growth.
However, corporate investment dipped by 3% (or by Rs 21,009 crore as measured in 2011-12 prices).
What does this say? Demand might have picked up resulting in higher manufacturing output. But not enough for the companies to see the invest in additional capacity.
When Indian economy was growing at 9% plus for five years in 2000-10, investment demand accounted for nearly half of the growth.

Government spending spurts: Nearly a fifth of GDP growth in latest quarter is due to government spending. This is clearly not sustainable as it would lead to widening fiscal deficit. Higher fiscal deficit will increase cost of borrowing for all others in the economy.

Exports finally showing growth: After many quarters of decline, exports reported a 3% increase. This is a positive as many export oriented industries are manpower-intensive sectors. This will create more jobs.

Mining, hotel, construction industries have slowed down

 

The positives: stable private consumption, growth in exports, pick up in manufacturing output.

The negatives: higher government spending not sustainable, key industries like mining and construction still sluggish, and corporate investment yet to pick up.

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