Government shutdown becomes longest in US history

Agencies
January 12, 2019

Washington, Jan 12: The US government shutdown that has left 800,000 federal employees without salaries as a result of President Donald Trump's row with Democrats over building a Mexico border wall entered a record 22nd day Saturday.

The Democrats' refusal to approve $5.7 billion demanded by Trump for the wall project has paralyzed Washington, with the president retaliating by refusing to sign off on budgets for swaths of government departments unrelated to the dispute.

As a result, workers as diverse as FBI agents, air traffic controllers and museum staff, did not receive paychecks Friday.

The partial shutdown of the government became the longest on record at midnight Friday (0500 GMT Saturday), when it overtook the 21-day stretch in 1995-1996, under president Bill Clinton.

Trump on Friday backed off a series of previous threats to end the deadlock by declaring a national emergency and attempting to secure the funds without congressional approval.

"I'm not going to do it so fast," he said at a White House meeting.

Trump described an emergency declaration as the "easy way out" and said Congress had to step up to the responsibility of approving the $5.7 billion.

"If they can't do it... I will declare a national emergency. I have the absolute right," he insisted.

Until now, Trump had suggested numerous times that he was getting closer to taking the controversial decision.

Only minutes earlier, powerful Republican ally Senator Lindsey Graham tweeted after talks with Trump: "Mr. President, Declare a national emergency NOW."

It was not clear what made Trump change course.

But Trump himself acknowledged in the White House meeting that an attempt to claim emergency powers would likely end up in legal battles going all the way to the Supreme Court.

Opponents say that a unilateral move by the president over the sensitive border issue would be constitutional overreach and set a dangerous precedent in similar controversies.

The standoff has turned into a test of political ego, particularly for Trump, who came into office boasting of his deal making powers and making an aggressive border policy the keystone of his nationalist agenda.

Democrats, meanwhile, seem determined at all costs to prevent a president who relishes campaign rally chants of "build the wall!" from getting a win.

Both Democrats and Republicans agree that the US-Mexican frontier presents major challenges, ranging from the hyper-violent Mexican drug trade to the plight of asylum seekers and poor migrants seeking new lives in the world's richest country.

There's also little debate that border walls are needed: about a third of the frontier is already fenced off.

But Trump has turned his single-minded push for more walls into a political crusade seen by opponents as a stunt to stoke xenophobia in his right-wing voter base, while wilfully ignoring the border's complex realities.

For Trump, who visited the Texas border with Mexico on Thursday, the border situation amounts to an invasion by criminals that can only be solved by more walls.

"We have a country that's under siege," he told the local officials in the White House.

Some studies show that illegal immigrants generally commit fewer crimes than people born in the United States, although not everyone agrees on this.

More certain is that while narcotics do enter the country across remote sections of the border, most are sneaked through heavily guarded checkpoints in vehicles, the government's own Drug Enforcement Administration said in a 2017 report.

It said that most smuggling is done "through US ports of entry (POEs) in passenger vehicles with concealed compartments or commingled with legitimate goods on tractor trailers."

Nancy Pelosi, the Democratic leader in the House of Representatives and a key figure in opposing Trump's agenda, said money should be spent in many areas of border security, but not on walls.

"We need to look at the facts," she said.

But Trump accused the Democrats of only wanting to score points against him with a view to the 2020 presidential elections.

"They think, 'Gee, we can hurt Trump,'" he said. "The Democrats are just following politics."

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News Network
February 29,2020

New Delhi, Feb 29: India’s economy expanded at its slowest pace in more than six years in the last three months of 2019, with analysts predicting further deceleration as the global Covid 19 coronavirus outbreak stifles growth in Asia’s third-largest economy.

The gross domestic product (GDP) data released yesterday showed government spending, private investment and exports slowing down, while there is a slight upturn in consumer spending and improvement in rural demand lent support.

The quarterly figure of 4.7% growth matched the consensus in a Reuters poll of analysts but was below a revised - and greatly increased - 5.1% rate for the previous quarter.

The central bank has warned that downside risks to global growth have increased as a result of the coronavirus epidemic, the full effects of which are still unfolding.

Prime minister Narendra Modi’s government has taken several steps to bolster economic growth, including a privatisation push and increased state spending, after cutting corporate tax rates last September.

In its annual budget presented this month, the government estimated that annual economic growth in the financial year to March 31 would be 5%, its lowest for last 11 years.

Modi’s government is targeting a slight recovery in growth to 6% for 2020/21, still far below the level needed to generate jobs for millions of young Indians entering the labour market each month.

The annual GDP figure for the September quarter was ramped up from an earlier estimate of 4.5%, while the April-June reading was similarly lifted to 5.6% from 5%, data released by the Ministry of Statistics showed on Friday.

Capital Investment Drop

In the December quarter, private investment grew 5.9%, up from 5.6% in the previous quarter, while government spending rose by 11.8%, against 13.2% in the previous three months.

However, corporate capital investment contracted by 5.2% after a 4.1% decline in the previous quarter, indicating that interest rate cuts by the central bank have failed to encourage new investment. Manufacturing, meanwhile, contracted by 0.2%.

“It appears growth slowdown is not just cyclical but more entrenched with consumption secularly joining the slowdown bandwagon even as the investment story continues to languish,” said Madhavi Arora of Edelweiss Securities in Mumbai.

Many economists said that the government stimulus could take four to six quarters of time before lifting the economy and the impact of those efforts could be outweighed by the global fallout from the coronavirus epidemic that began in China.

“The coronavirus remains the critical risk as India depends on China for both demand and supply of inputs,” said Abheek Barua, chief economist at HDFC Bank.

Indian shares sank on Friday for a sixth session running, capping their worst week in more than a decade. The NSE Nifty 50 index shed 7.3% over the week, while the Sensex dropped 6.8%, the worst weekly declines since the 2008-09 financial crisis.

Separately, India’s infrastructure output rose 2.2% year on year in January, data showed on Friday.

A spike in inflation to a more than 5-1/2 year high of 7.59% in January is expected to make the RBI hold off from further cuts to interest rates for now, while keeping its monetary stance accommodative.

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News Network
January 20,2020

New Delhi, Jan 20: Surging inflation and slowing growth are raising serious concerns about the future growth prospects of the economy and as a remedial measure the government should resolve supply-side hurdles and ensure more stringent governance norms, a report said on Monday.

According to the Dun and Bradstreet Economy forecast, even though the Index of Industrial Production (IIP) turned positive in November 2019, it is likely to remain subdued.

"Slowdown in consumption and investment along with high inflationary pressures, geopolitical issues and uncertainty over the recovery of the economic growth are likely to keep IIP subdued," the report noted.

Dun and Bradstreet expect IIP to remain around 1.5-2.0 percent during December 2019.

As per government data, industrial output grew 1.8 percent in November, turning positive after three months of contraction, on account of growth in the manufacturing sector.

On the price front, uneven rainfall along with floods in many states and geopolitical issues have led to a surge in headline inflation even as demand remains muted.

The Consumer Price Index (CPI) in December rose to about five-and-half year high of 7.35 percent from 5.54 percent in November, mainly driven by high vegetable prices.

"The sharp rise in inflation has constrained monetary policy stimulus while revenue shortfall has placed limits on the government expenditure," Dun & Bradstreet India Chief Economist Arun Singh said.

According to Singh, growth-supporting measures and deceleration in growth are likely to cause slippage in fiscal deficit target by a wider margin.

"The government should focus on taking small steps to address the slowdown; in particular, resolve the supply-side hurdles and ensure more stringent governance norms," Singh said.

Unless these concerns are addressed through a comprehensive policy framework, it will not be easy for India to clock a sustainable growth rate to become a USD 5 trillion economy, he added.

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News Network
June 13,2020

New Delhi, Jun 13: India's COVID-19 tally on Saturday witnessed its highest-ever spike of 11,458 cases, according to the Union Ministry of Health and Family Welfare (MoHFW).

A total of 386 deaths have been reported due to the infection during the last 24 hours.

The total number of coronavirus cases in the country now stands at 3,08,993 including 1,45,779 active cases 1,54,330 cured/discharged/migrated and 8,884 deaths.

COVID-19 cases in Maharashtra continue to soar with the number reaching 101141. Tamil Nadu's coronavirus count stands at 40,698 while cases in Delhi reached 36,824.

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