Modi is favourite PM candidate of Muslims for 2019: Shahnawaz

New Delhi, Jan 20: Union Finance Minister Nirmala Sitharaman on Sunday said the kind of cleaning in the system that the BJP-led government had to carry out after coming to power in 2014 was "unbelievable" and it undertook the exercise without any grudge or worry.

Between 2014-16, there were a lot of questions as to why reforms did not come fast and there were comments that the government was incapable of bringing them, she said delivering the Nani Palkhivala Memorial lecture on "Road Map to $5 Trillion Economy" here.

Pointing out that there were allegations and criticism that the government wants to do something but it did not, Sitharaman said, "I am fully willing to buy that." She recalled that Prime Minister Narendra Modi often said he did not believe in incremental changes and the country needed good transformational change. The stage in which India is today, it cannot have little marginal increments, but good transformational change.

"But still one might say in the last five years the government never did. That can be a critical analysis and I am fully willing to buy that. Because post-2014 the kind of cleaning up the government had to do was unbelievable and we undertook that exercise without a grudge without a worry.. we had to do it and it is part of the game," she said. Elaborating, Sitharaman said states have their own views on Land Acquisition Bill and the government could not have done anything because land, after all, is with them.

Commenting on the topic 'Road Map to $5 trillion economy,' she said quoting Prime Minister Narendra Modi's comments, the government would take the route "Sarkar ka abhaav nahi hona chahiye, prabhaav hona chahiye aur dabaav nahi hona chahiye."

"Abhaav and dabaav both of which are not desirable, abhaav is the inadequacy or lack of adequate presence or shortfall. You do not need a shortfall. You need a government where it should be present, where it is expected to function.", she said.

"So there should not be abhaav. Dabaav (meaning pressure) is not something you want from the government. So, you want Prabhaav. It is broadly an influence, facilitation, broadly the philosophy with which it is mandated, she said.

Noting that the government has got the mandate through the election, she said, "The mandate was spelt out in so many different ways in its manifesto. So the route towards $5 trillion is this."

"We have to be there to facilitate. We have to be there to make it easy. We have to be where you need us, where there is no policy (reforms from the government)," she said.

On the Insolvency and Bankruptcy Code (IBC) implemented by the government, the union minister said the approach of the IBC was not to shut business. "IBC takes on the approach in having some kind of resolution where all people who exploited the company do not come back through the "back door," she said.

IBC was done through better management so that the institution is alive and kicking. It is something which she wanted to carry forward from Modi 1.0 to 2.0. "The point I am trying to make on this road to $5 trillion economy is that it is not just an abstraction, this is not how I want India to be. But in micro-level too, we are coming in response to every stakeholder," she said.

Mar 21: India’s economy, already in the grip of a slowdown, is in for more pain after Prime Minister Narendra Modi appealed to citizens to stay at and work from home to curb the coronavirus outbreak.

The services sector, which accounts for about 55% of India’s gross domestic product, is poised to be the worst hit after Modi, in a late evening address on Thursday, urged citizens to go on a self-imposed curfew for a day and private companies to allow employees to work from home for longer. In the country’s vast informal sector, social-distancing measures could mean a dent to productivity and consumption because of job or pay losses.

“The impact of a partial lock-down or social distancing will be significant,” said Rahul Bajoria, a senior economist at Barclays Plc in Mumbai. “If there’s a widespread community outbreak, GDP could fall as low as 3.5% in the year starting April 1.”

Shrinking output may limit growth in an economy that’s already set to expand at an 11-year low of 5% in the current year to March 31. Before the virus outbreak, India had forecast growth to recover to 6%-6.5% in the next fiscal year. S&P Global Ratings and Fitch Ratings have already slashed their growth forecast by 50 basis points.

“The current social-distancing measures will severely impact airlines, hotels, malls, multiplexes, restaurants and retailers,” according to analysts at Crisil Ltd., the local unit of S&P Global. “Lower footfalls and occupancies, decline in business volume and sub-optimal operating efficiencies will impact cash flows of companies in these sectors,” wrote the analysts led by Chief Economist Dharmakirti Joshi.

The government will try to announce a relief package for virus-affected sectors as early as possible, Finance Minister Nirmala Sitharaman said Friday.

In a televised address, Modi advised all citizens to stay at home for a day on March 22, as he sought to stem the spread of the coronavirus -- cases of which are relatively low in India at about 200, compared with more than 200,000 infected people globally. His government also barred incoming flights for a week from that day, joining a growing list of countries effectively sealing their borders.

What Bloomberg’s Economists Say

We had only earlier this week lowered our GDP outlook to consider the direct impact of the local outbreak as confirmed virus cases exceeded 100 as of March 15 and the federal and state governments announced social distancing measures that have already started to crimp economic activity. We are now revising down our GDP estimate for 4Q fiscal 2020 to 3.3%, from our 3.5%.

-- Abhishek Gupta, India economist

For more, click here

“Consumption being the biggest component of GDP, a lock-down is bound to have a big impact on the economy,” said Devendra Kumar Pant, chief economist at India Ratings and Research, the local unit of Fitch. “Modeling uncertainty in any system will be very difficult, but one can say the slowdown could deepen or prolong further.”

Work From Home

While companies, including billionaire Mukesh Ambani-controlled Reliance Industries Ltd., are asking employees to work from home, the option isn’t feasible in India’s vast informal sector.

“The option to work remotely simply won’t exist for most,” said Shilan Shah, an economist with Capital Economics Pte. in Singapore.

As many households don’t have savings buffers, the government would probably have to back this up with large-scale cash handouts that reach the poorest, he said.

Work from home is posing implementation challenges for the manufacturing sector where workers are required to be physically present at the production sites. The services sector, such as banking and information technology, also needs employees to be present in offices as confidential data is used, according to industry group Federation of Indian Chambers of Commerce and Industry.

Washington, Jun 26: The US is reviewing its global deployment of forces to ensure it is postured appropriately to counter the People's Liberation Army, given the increasing threat posed by China to Asian countries like India, Malaysia, Indonesia, and the Philippines, Secretary of State Mike Pompeo said on Thursday.

Mr Pompeo made those remarks in response to a question during the virtual Brussels Forum 2020 of the German Marshall Fund.

"We're going to make sure we're postured appropriately to counter the PLA. We think that the challenge of our times, and we're going to make sure we have resources in place to do that," Mr Pompeo said.
 
The force posture review is being done at the direction of President Donald Trump, as part of which the US is reducing the number of its troops in Germany from about 52,000 to 25,000, he said.

Mike Pompeo said that the force posture would be dictated by the ground realities.

"In certain places there will be fewer American resources. There'll be other places - I just talked about the threat from the Chinese Communist Party, so now threats to India, threats to Vietnam, threats to Malaysia, Indonesia, South China Sea challenges, the Philippines," he said.

"To the extent that that changed, the difference in what the US decided to do impacts adversely a threat some place, it may be that other nations need to step up and take responsibility for their own defense in ways that they hadn't done previously. So, we want to do this in full consultation with all of our partners all around the world, and certainly our friends in Europe," Mr Pompeo said.

President Trump is being criticised for reducing troops from Germany. His critics say that this will increase the threat from Russia to Europe.

Mike Pompeo, however, did not agree with that argument.

It has been a long time since there has been a strategic review of our force posture all across the world. The US undertook that starting about 2.5 years ago, whether that was our forces in Africa, our forces in Asia, the force we have in the Middle East and in Europe, he said.

"We began to say these are often decisions that were made in a different time. Should we reallocate those a different way? Should we have a different composition of those forces? Everyone always wants to talk about ground troops. I get it. I was a young tank officer. You described that. There's nothing I like as much as a good M1 tank.

"But it's often the case that the capacity to deter Russia or other adversaries isn''t determined any longer by just having a bunch of folks garrisoned someplace. So, we really went to back fundamentally relook, what is the nature of the conflict, what''s the nature of the threat, and how should we allocate our resources, whether that''s our resources in the intelligence community, our resources from the Air Force or the Marines and Army," Mr Pompeo said.

Last week, Mike Pompeo criticised the Chinese Army for "escalating" the border tension with India and militarising the strategic South China Sea. He also described the ruling Communist Party of China (CPC) as a "rogue actor".

"Our broad set of allocation of security apparatus, our ability to counter cyber threats, how do we allocate them? What''s the best way to do this? And the decision that you see the president made with respect to Germany is an outcome from a collective set of decisions about how we''re going to posture our resources around the world," said the top American diplomat on Thursday.

Changes in force posture is being taken in consultations with allies and friends, Mr Pompeo said.

"President Trump has spoken to this. (Defense) Secretary (Mark) Esper will be in London today and in Brussels tomorrow. We''ll talk about our plan and how we''re thinking about delivering it," he said.

"But you should understand this, and I hope our European partners will understand this as well. When you see what we ultimately conclude, how we ultimately deliver on the statements of the president made, that they''re aimed squarely at what we believe to be democracies'' fundamental interest and certainly America's most fundamental interest," Mr Pompeo said.

Earlier this month, Mike Pompeo had said that China's actions, be it on the India border, or in Hong Kong or in the South China Sea, were part of the behaviour of the ruling Communist Party in Beijing in the recent past.

China has been fast expanding military and economic influence in the Indo-Pacific region, triggering concern in various countries of the region and beyond.

China is engaged in hotly contested territorial disputes in both the South China Sea and the East China Sea. Beijing has built up and militarised many of the islands and reefs it controls in the region. Both areas are stated to be rich in minerals, oil and other natural resources and are vital to global trade.

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