The recovery of the Indian economy reeling from the impact of the Covid-19 pandemic will be gradual, RBI Governor Shaktikanta Das said on Wednesday.
Addressing the FICCI National Executive Committee Meeting, the central bank chief said that the country is still reeling under the impact of Covid-19 and will gradually come back on normal growth path.
He, however, said that things have considerably improved in the second quarter after adverse impact the pandemic had on economic activity in the first quarter.
“Nevertheless, high frequency indicators of agricultural activity, the purchasing managing index (PMI) for manufacturing and private estimates for unemployment point to some stabilisation of economic activity in Q2, while contractions in several sectors are also easing,” he said.
“The recovery is, however, not yet fully entrenched and moreover, in some sectors, upticks in June and July appear to be levelling off. By all indications, the recovery is likely to be gradual as efforts towards reopening of the economy are confronted with rising infections.”
According to Das, financial market conditions in India have eased significantly across segments in response to the frontloaded cuts in the policy repo rate and large system-wide as well as targeted infusion of liquidity by the RBI.
“Despite substantial increase in the borrowing programme of the government, persistently large surplus liquidity conditions have ensured non-disruptive mobilisation of resources at the lowest borrowing costs in a decade,” he elaborated.
In August 2020, the yield on 10-year G-sec benchmark surged by 35 basis points amidst concerns over inflation and further increase in supply of government papers.
Following the RBI’s announcement of special open market operations (OMOs) and other measures to restore orderly functioning of the G-sec market, bond yields have softened and traded in a narrow range in September.
“Although bank credit growth remains muted, scheduled commercial baks’ investments in commercial paper, bonds, debentures and shares of corporate bodies in this year so far (up to August 28) increased by Rs 5,615 crore as against a decline of Rs 32,245 crore during the same period of last year,” he said.
“Moreover, the benign financing conditions and the substantial narrowing of spreads have spurred a record issuance of corporate bonds of close to Rs 3.2 lakh crore during 2020-21 up to August.”
Besides, he pointed out that the immediate policy response to Covid in India has been to prioritise stabilisation of the economy and support a quick recovery.
Citing World Bank assessment, Das said that recovery globally would take a longer route as it is not fully entrenched.
Flipkart Wholesale expands footprint to 12 new cities
Digital business-to-business marketplace Flipkart Wholesale on Thursday said it has expanded its operations to 12 new cities ahead of the festive season.
Flipkart Wholesale will now be operational in Ghaziabad, Faridabad, Mysuru, Chandigarh Tricity, Meerut, Agra, Jaipur, Thane-Bhiwandi-Ulhasnagar, Greater Mumbai, Vasai-Virar-Mira-Bhayanadar, Thane (Kalyan-Dombivli) and Thane (Navi Mumbai).
Expanding with the fashion category in these cities, Flipkart Wholesale said it is looking to digitally transform kiranas and micro, small and medium-sized enterprises (MSMEs) to help them grow faster, retain their customers, and improve their profitability.
“As we enter the festive season, we are excited to be scaling up our offerings across 12 cities, aiming to create more opportunities for MSMEs and Kiranas,” Adarsh Menon, Senior Vice President and Head – Flipkart Wholesale, said in a statement.
“From trendy Jaipuri Kurtis to evergreen Mysuru silk saris, we aim to help small businesses embrace the digital transformation and emerge as more robust businesses,” Menon added.
By this year-end, Flipkart Wholesale also plans to expand into categories such as home and kitchen, and grocery.
Flipkart Wholesale said its customers will have access to easy credit facilities in partnership with leading banks and non-banking financial companies to manage cash flow.
E-commerce platform Flipkart first announced the launch of Flipkart Wholesale’s operations earlier this month.
At the time of the launch, the platform was available for fashion retailers, especially footwear and apparel, in Gurugram, Delhi and Bengaluru.
Nepal-China border point reopens after 3-week closure
Nepal’s Chinese conundrum: The imbalance and debt trap.
The Rasuwagadhi-Kerung border point between Nepal and China reopened on Thursday after it remained closed for around three weeks due to the Covid-19 pandemic, a senior customs official said here.
The border point, which is one of the key trade routes between the two country, was closed after a Nepali worker tested positive for the novel coronavirus, reports Xinhua news agency.
Earlier, it reopened in early July after it was closed for nearly six months firstly due to snowfall in the bordering Chinese region and later because of the Covid-19 outbreak.
“Two containers of medical goods entered into Nepal after the reopening of border point on Wednesday,” senior customs officer at Rasuwagadhi, Punya Bikram Khadka told Xinhua.
“Now, we hope the movement of goods will take place normally.”
According to the officer, there has been a restricted flow of goods through this border as both countries have adopted zero human-to-human contact policy between the two sides until the pandemic is over.
The Tatopani-Zhangmu, another border point, which reopened in late March after closing in January, has also remained shut for the last few months.
Imports fall leads to New Zealand’s largest trade surplus in 6 yrs
New Zealand imports fell nearly NZ$1 billion ($650 million) in August, leading to the country’s largest annual trade surplus since 2014, the Stats NZ said on Thursday.
The NZ$1.3 billion annual goods trade surplus reflected a rise in exports and a fall in imports over the past months, Xinhua news agency quoted Stats NZ as saying.
“The recent falls in imports and growth in exports resulted in an annual trade surplus not seen since the strong 2013-2014 dairy export season, when product prices were high,” senior analyst Nicholas Cox said in a statement.
Imports of crude oil, cars, and other vehicles were much lower than usual in recent months after the Covid-19 pandemic, Cox said.
New Zealand’s demand for fuel dropped due to the international and domestic travel restrictions, which were put in place to slow the spread of the novel coronavirus.
During the lockdown in April, imports of vehicles were particularly affected by international trade restrictions and the closure of vehicle dealerships as non-essential businesses, he added.
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