Union Minister of State for Finance Arjun Ram Meghwal on Thursday said the transition towards digital and cashless economy will boost India's GDP numbers and also help prevent tax evasion and move towards compliance.
"Digital and cashless transactions will boost Gross Domestic Product growth in a meaningful transition for the Indian economy," Meghwal said here while addressing a conference on ‘Digital and Cashless Economy: A New Paradigm for NextGen Businesses' organised by the Confederation of Indian Industry (CII
"We have to change to a tax-compliant society if India needs to grow and move forward," he said.
He said India is on the verge of a transition from a largely cash economy to a less cash and a more digital economy, and added that the November 8 demonetisation was in accordance with the general public's will to move towards a corruption-free society.
"Promotion of a digital economy has had a transformative impact and the people of India have supported the initiative. Digital payments is the way forward towards a cashless economy," he added.
Migration to digital payments has generated significant benefits for the common man and the government was taking initiatives to spread awareness on this count, Meghwal said.
"The government is empowering people in non-urban and rural areas to enable them to adopt technology. Embracing digital and cashless economy is the collective responsibility of the government, citizens as well as the corporate sector," he said.
Tata Motors and Microsoft India on Thursday announced that they were collaborating to provide their clients with a personalised driving experience with the country’s “first connected car”. In a joint statement, the firms said they will unveil a vehicle with an “enhanced driving experience” at the Geneva International Motor show on March 7.
“Using the internet of things, artificial intelligence and machine learning technologies, we will provide vehicle owners in India and across the world a safe, productive and fun driving experience,” said Microsoft India President Anant Maheshwari.
Tata Motors CEO Guenter Butschek told reporters that the collaboration would help increase revenues as the potential customers were looking for value-added services.
Microsoft’s technology will help Tata Motors add connectivity features to “mainstream, mass-market vehicles at affordable prices”. Their plans include using Microsoft Azure cloud computing technologies to facilitate “advanced navigation, predictive maintenance and vehicle-centric services”, among providing other features.
Headline CPI (consumer price index) inflation dipped to 3.2% in January led by large dip in food inflation caused again by drops in prices of vegetables and pulses. On the other hand, core inflation increased on the back of higher fuel prices. It is believed that headline retail inflation could move up over the next few months, probably clawing back to the 5% zone by the end of FY18, according to a research note from IDFC Bank. The current prognosis of Headline WPI (wholesale price index) inflation therefore, is unlikely to provide further scope for the RBI (Reserve Bank of India) to turn dovish.
The decline in food inflation was led by lower prices of certain food items such as vegetables and pulses. While vegetable prices declined by 4.7% month-on-month compared with 11.7% mom decline in December, pulses prices dropped by 5.5% mom compared with a decline of 1.7% in December. On a year-on-year basis, vegetable prices declined 15.6%, compared with a 14.6% decline in December. While a part of the drop is attributable to seasonal factors, demonetisation possibly had also played a part with lower currency availability leading to lower off-take from the farm gate. The only category within food which is seeing some upward pressure is sugar.
Core inflation at 5.1% was higher than the December print of 4.9%. Thus, the RBI was probably justified in highlighting that the sticky core could be a principal worry in the medium term. As expected, the increase in core was led by transport & communication index which showed an uptick on the back of increase in retail price of petrol and diesel. With oil prices sustaining at current levels, some pass-through of higher fuel prices will be visible in the economy, pointed out the research note.
From an inflation targeting mandate, the RBI is intended on moving inflation to a durable level of 4%, concludes the research note.
India's goods exports rose in January for the fifth straight month on the back of stronger commodity prices, despite growing protectionist and anti-trade sentiment in the United States and Europe.
Merchandise exports grew 4.32 percent year-on-year to $22.12 billion, while imports rose 10.7 percent to $31.96 billion, the Ministry of Commerce and Industry said in a statement.
Oil prices - up nearly 18 percent since the end of November - forced up the bill for crude oil, India's largest import item, by 61.1 percent to $8.1 billion, threatening to reverse recent declines in inflation.
Countering that, oil exports also rose, by 29 percent to $2.7 billion, as some crude oil is processed and re-exported by Indian oil refiners such as Reliance Industries.
The monthly trade deficit narrowed slightly to $9.8 billion. The deficit fell nearly $20 billion in 2015/16 as the cost of oil imports halved thanks to a slide in prices, a trade windfall to Prime Minister Narendra Modi's government.
Merchandise exports account for just 1.6 percent of global trade, compared with nearly 14 percent for China. Modi wants to lift India's share to 5 percent by 2020.
His ambitions, however, face headwinds from rising anti-trade sentiment worldwide.
U.S. President Donald Trump's "America First" trade policy as well as Britain's surprise vote last year to leave the European Union have clouded the global trade outlook.
With elections due in a number of major euro zone countries this year, very few see a let up in protectionist rhetoric.
"India is likely to face continued headwinds on the exports front due to the play out of Brexit and the anti-globalisation stance of U.S. President Donald Trump," Fitch subsidiary India Ratings' economist Sunil Kumar Sinha said.
India's Finance Minister Arun Jaitley has warned that a popular backlash against globalisation is a major risk for the nascent recovery in Indian exports.
A particular worry is Trump's immigration policies, which could cast a shadow on the fortunes of India's $146 billion IT services industry in its biggest market.
Underscoring the challenge, net services exports between April and December fell to $48.3 billion from $53.6 billion a year ago.
Australia’s business conditions and sentiment increased solidly in January, consistent with rebounding surveys throughout Australia and globally. The report details also came in solid. This implies that the Australian business sector is starting 2017 on a strong footing, and that growth is expected to improve after the recent softness, noted ANZ in a research report.
Australia’s Business conditions index rose sharply by six points to 16.2 in January from December’s 9.9, starting this year with a bang, with overall conditions rising for the second straight month to the highest level since 2007. The surge in business conditions data affirms the view that the Australian economy is in fundamentally good shape. The unexpected softness recorded in the third quarter GDP might be just temporary.
The affirmative view is underpinned by the report’s underlying details. The employment index seems to have bottomed and risen in January to the highest level in more than five years. Business profitability is also at higher levels and implies that the future employment growth outlook is strong, following the flat patch toward the end of 2016, noted ANZ.
The divergence in conditions throughout industries is the only real downside to the report. Even if conditions rebounded throughout most industries in January, certain sectors continue to be weak. The mining sector has witnessed some recent rebound due to solid commodity prices; however, it stays subdued as investment continues to decline. In the meantime, the retail sector continues to struggle from increased competition.
Meanwhile, Australia’s business sentiment has also risen strongly in January. The index rose from December’s 5.7 to 9.8 in January. The recent rebound in global PMIs and improved domestic trading conditions are expected to have underpinned the strong jump in Australia’s business sentiment.
At 6:00 GMT the FxWirePro's Hourly Strength Index of Australian Dollar neutral at 28.74, while the FxWirePro's Hourly Strength Index of US Dollar was neutral at -18.78