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RBI likely to get quite perturbed with inflation above 6% in three quarters

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With inflation likely to exceed 6 per cent for three consecutive quarters, especially if energy prices remain elevated, the RBI is likely to get quite perturbed, Emkay Global Financial Services said in a report.

With higher food price pressure in the near term (summer effect, international prices, higher transport cost, supply chains) and persistent input cost pressure in the non-food segment, it now sees inflation crossing 6 per cent in FY23.

The March ’22 print strengthens rate hike expectations in June ’22. We maintain that FY23 could see a rate hike of up to 100bps. The terminal rate may go a tad higher from 5.25 per cent, with the RBI now showing its intent to keep real rates neutral, the report said.

March ’22 inflation surged to near 7 per cent, reflecting a broad-based increase in food and non-food inflation. Perishable food items seem to have been hurt by higher transportation and fuel costs. We are unlikely to see any relief in food prices in the near term, as supply-chain price pressure and summer months further weigh in, the report added.

Core inflation at 6.6 per cent depicted the persistence of input cost pressure, which has started to percolate to output prices.

The Mar’22 inflation print exceeded the RBI’s target range materially, and the next two quarters are also likely to exceed 6 per cent, which could pressure the RBI to act sooner than later. We are tracking April ’22 inflation at 7.2 per cent, albeit peaking, assuming pump prices stabilize ahead. With food prices looking high in the near term (summer effect, international prices, higher transport cost, supply chains) and persistent input cost pressure in the non-food segment, we now see inflation crossing 6 per cent in FY23.

The RBI reckoned that inflation has again taken precedence over growth in its reaction function. With inflation realities worsening, June hike is likely (with or without stout and formal stance change). FY23 could see rates go up by 100bps. The terminal rate may be a tad higher than 5.25 per cent, with the RBI now showing its intent to keep real rates neutral.

National

Bengal Police unnecessarily creating panic over Ram Navami: BJP

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Kolkata, April 2: A senior leader of BJP from West Bengal, on Wednesday, accused the West Bengal Police of creating unnecessary panic among common people over the forthcoming Ram Navami festival.

BJP’s former national vice-president and former party Lok Sabha member Dilip Ghosh said that the decision of the police authorities to cancel the leaves of all cops, except for emergency reasons, from April 2-9 was unnecessary.

“Such panic-driven decisions are prompted only during Hindu festivals. The police should take care of those who create trouble. Hindus are well organised and they perform their religious rituals peacefully. Lakhs of people participate in Durga Puja, and no tension is created. It has become a habit of the ruling party to create tension and panic,” Ghosh said.

He also said that the chances of untoward incidents over the Ram Navami processions will not be there if the police strictly handle those who want to create tension on the occasion.

Last week, two senior officials of West Bengal Police told media persons that they have got specific intelligence inputs on some vested interests trying to instigate violence in the coming days, especially targeting the forthcoming Ram Navami festival.

“There are plans to instigate people through different posters or posts. The police are on alert. There might be attempts to instigate tension among people from different communities, especially focusing on the occasion of Ram Navami. We requested people not to get instigated. There is no need to worry. But at the same time, we also request people to alert the local police in case they notice any suspicious activities in their respective areas,” said Additional Director General (South Bengal) Supratim Sarkar on March 29.

Recently, there were reports of communal clashes from Mothabari in Malda district.

Recently, the Leader of the Opposition in West Bengal, Suvendu Adhikari, said at least 2,000 rallies, big and small combined, will be brought out on the occasion of Ram Navami this year.

He also said that participants at the rallies on Ram Navami this year will be double compared to last year.

“Ram Navami will be celebrated this year in a major way. I will be there on the streets on that day. Last year, around 50 lakh Hindus were on the streets to participate in rallies on the occasion of Ram Navami. Last year, there were 1,000 rallies. This year there will be 2,000 rallies and around one crore Hindus will participate in those rallies this year,” he claimed.

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International

Man rescued in Myanmar’s Nay Pyi Taw five days after earthquake

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Yangon, April 2: A 26-year-old hotel staff member was rescued from the rubble of a collapsed hotel building in Myanmar’s Nay Pyi Taw on Wednesday, five days after the 7.7-magnitude earthquake struck the country, according to the State Administration Council’s information team.

Two people were trapped under the debris, and rescue teams from the Myanmar Fire Services Department and Turkey successfully pulled one survivor to safety, the information team said.

The operation at the hotel began at around 3:00 p.m. local time on Tuesday, and the man was rescued by approximately 00:30 a.m. local time on Wednesday, it said.

Efforts are ongoing to locate and rescue the remaining trapped individuals, media reported.

The death toll from the 7.7 magnitude earthquake in Myanmar has risen to 2,719, with approximately 4,521 people injured and 441 others still missing, said the country’s Prime Minister Min Aung Hlaing.

Meanwhile, Aung Hlaing, head of Myanmar’s junta, rejected ceasefire proposals from Ethnic Armed Organisations (EAOs) and declared a continuation of military operations.

This move directly affects humanitarian efforts as the casualties from the devastating earthquake escalate.

“Some ethnic armed groups may not be actively engaging in battles right now, but they are gathering and training in preparation for attacks. Since this is a form of aggression, the military will continue necessary defence operations,” Hlaing said during a fundraising event in Naypyidaw on Tuesday.

A powerful 7.7 magnitude earthquake, followed by a 6.4 magnitude aftershock minutes later, struck Myanmar’s Mandalay region on Friday, causing massive casualties and damage.

Myanmar announced on Monday a week-long mourning period following the earthquake that struck the nation and wrought widespread destruction.

As the earthquake left entire communities in ruins, reports suggest that concerns have arisen about the potential for Myanmar’s military junta to direct humanitarian funds to affected areas. It is stated that supplies are driven to the areas the junta favours rather than those most in need of help.

The United Nations and international aid organisations are struggling to respond to the devastating earthquake, which destroyed several cities such as Mandalay, Sagaing, and Naypyitaw, and displaced tens of thousands of people. The hospitals are trying to cope with the high influx of patients.

However, the United Nations, the US, India, the European Union, and several other nations and international organisations have sent aid and rescue efforts for earthquake victims in Myanmar.

The Indian Army and Navy mobilised their resources with unwavering resolve, providing both immediate rescue support and long-term aid to the affected communities.

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National

Maha govt transfers seven bureaucrats in a minor reshuffle

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Mumbai, April 2: In a minor reshuffle, the Maharashtra government on Wednesday transferred seven bureaucrats.

Nishi Pandey, an IAS officer of the 2001 batch, has been posted as Managing Director of Maharashtra Small Scale Industries Development Corporation.

Laxminarayan Mishra, an IAS officer of the 2012 batch, has been posted as Joint Managing Director of Maharashtra State Road Development Corporation.

Bharat Bastewad, an IAS officer of the 2013 batch and CEO of Raigad Zilla Parishad, has been appointed Commissioner of the Mahatma Gandhi National Rural Employment Guarantee Scheme at Nagpur.

Indurani Jakhar, an IAS officer of the 2016 batch, who is the Municipal Commissioner of Kalyan-Dombivali Municipal Corporation, has been posted as Collector, Palghar district.

Vasumana Pant, an IAS officer of the 2017 batch, who is Director General, VANAMATI, Nagpur, has been posted as Additional Municipal Commissioner, Nagpur Municipal Corporation.

Vaishnavi B, an IAS officer of the 2019 batch, who is Chief Executive Officer, Akola Zilla Parishad, has been posted as Additional Municipal Commissioner, Nagpur Municipal Corporation.

Neha Bhosle, an IAS officer of the 2020 batch, has been posted as Chief Executive Officer, Raigad Zilla Parishad.

Earlier, on March 25, the state government transferred five IAS officers.

The state government posted B. H. Palawe, an IAS officer of the 2013 batch, who is Chief Executive Officer, Zilla Parishad, Palghar, as the Managing Director, Maharashtra State Financial Corporation, Mumbai.

Manoj Ranade, an IAS officer of the 2014 batch and the Director of Municipal Administration, Mumbai, was appointed Chief Executive Officer, Zilla Parishad, Palghar.

Shubham Gupta, an IAS officer of the 2019 batch and the Municipal Commissioner of Sangli-Miraj-Kupwad City Municipal Corporation, was posted as Member Secretary, Vidarbha Statutory Development Board, Nagpur.

Anjali Ramesh, an IAS officer of the 2020 batch, after transfer of cadre from Madhya Pradesh, was appointed Chief Executive Officer, Zilla Parishad, Hindoli.

Zenith Chandra Deonthula, an IAS officer of the 2022 batch, who is Assistant Collector, Varora Sub-Division, Chandrapur, was posted as Project Officer, ITDP, Kinwat, and Assistant Collector, Kinwat Sub-Division, Nanded.

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