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India is a globally significant market for gold business, but does not produce enough gold that can meet huge domestic demands. India stands at the second position in terms of gold import globally, after China. The country imports gold in the form of gold bars, which is governed by the RBI. According to the RBI circular, only the entities notified by the Directorate General of Foreign Trade (DGFT) are permitted to import gold to India after the issue of license by DGFT.
Gold is tightly regulated in India and currently only nominated banks and agencies approved by RBI can import gold and sell to dealers and jewellers across the country. The launch of the India International Bullion Exchange (IIBX) in GIFT City yesterday by the PM will bring in the following changes:
1) IIBX with its technology-driven solutions, will facilitate transition of Indian bullion market towards a more organised structure by granting qualified jewellers and bullion dealers a direct access to import gold directly through the exchange mechanism. 2) Standardization of Gold pricing in India 3) It will make India a global price-setter for bullion 4) IIBX is India’s first International Bullion Exchange set up at International Financial Services Center (IFSC) at GIFT City
1) India received the highest annual FDI inflows of $ 85 billion in FY 21-22.
2) India is rapidly emerging as a preferred country for FDI in the manufacturing sector. FDI Equity inflow in Manufacturing Sectors have increased by 76% in FY 2021-22 ($ 21.34 billion) compared to previous FY 2020-21.
3) As per the UNCTAD World Investment Report (WIR) 2022, in its analysis of the global trends in FDI inflows, India has moved to 7th rank among the top 20 host economies for 2021.
4) FDI country wise: Singapore (27.01%) > USA (17.94%) > Mauritius (15.98%) > Netherland (7.86%) > Switzerland (7.31%)
5) Top 5 States receiving highest FDI Equity Inflow during FY 2021-22 are Karnataka (37.55%), Maharashtra (26.26%), Delhi (13.93%), Tamil Nadu (5.10%) and Haryana (4.76%)
6) Top 5 sectors receiving highest FDI Equity Inflow during FY 2021-22 are Computer Software & Hardware (24.60%), Services Sector (Fin., Banking, Insurance, Non Fin/Business, Outsourcing, R&D, Courier, Tech. Testing and Analysis, Other) (12.13%), Automobile Industry (11.89%), Trading 7.72% and Construction (Infrastructure) Activities (5.52%).
It is to be noted that there is a difference between Gross FDI and net FDI. The FDI investors in India earn profit which they can take back to their home country or they can sell the investment as well in India and return to their home country. When this is subtracted from Gross FDI then we get Net FDI. Somewhere Gross FDI data is used and somewhere Net is used, so don't get confused. In 2021-22, Net FDI was around $55 billion.
11th Agricultural Census (2021-22) was launched yesterday.
Agriculture Census is conducted every 5 years, which is being undertaken now after delay due to corona pandemic. The 10th Agricultural Census was conducted in 2015-16.
Agricultural Census is the main source of information on a variety of agricultural parameters at a relatively minute level, such as the number and area of operational holdings, their size, class-wise distribution, land use, tenancy and cropping pattern, etc. This is the first time that data collection for agricultural census will be conducted on smart phones and tablets, so that data is available in time. Most of the States have digitized their land records and surveys, which will further accelerate the collection of agricultural census data. The use of digitized land records and the use of mobile apps for data collection will enable the creation of a database of operational holdings in the country.
A good article on how freebies impact growth, sustainable development, income and employment.
Regulatory capture is an economic theory that says regulatory agencies may come to be dominated by the industries or interests they are charged with regulating. The result is that an agency, charged with acting in the public interest, instead acts in ways that benefit incumbent firms in the industry it is supposed to be regulating.
National Sample Survey (NSS) The National Sample Survey (NSS) is a national socioeconomic survey conducted by National Statistical Office (NSO) in annual rounds with a cycle of rotating topics. For example, the purpose of the 71st round of the National Sample Survey (NSS) conducted in 2014 was to develop indicators on health and education. The purpose of the 68th round (July 2011 – June 2012) of National Sample Survey was Household Consumption Expenditure.
The Household Consumption Expenditure Survey (HCES), generally comes after every five years (quinquennial) during these annual rounds of NSS.
HCES generates estimates of household Monthly Per Capita Consumer Expenditure (MPCE) and the distribution of households and persons over the MPCE classes. It is designed to collect information regarding expenditure on consumption of goods and services (food and non-food) consumed by households. The results, after release, are also used for:
1) Rebasing/base revision of the GDP 2) Base revision of the CPI (i.e. weights of various items in CPI), 3) Measuring estimates of poverty levels; and 4) Other macro-economic indicators
Todays News: The 79th Round of NSS is again going to be on HCES which has already started from 1st July 2022 and will continue till 30th June 2023. This HCES will also collect data on items received free from the Government's welfare programmes.
The 75th round of NSS was also on Household Consumption Expenditure from the period July 2017 – June 2018 which reported that the consumer expenditure in the period 2011-12 – 2017-18 has fallen, but the government did not release the report as it noticed that there was divergence in the data.
Above is news from Hindu. A general article on effectiveness of GDP measurement.
The article discusses the relationship between GDP growth and employment generation and it is best represented by the term: Employment Elasticity of Growth = % change in employment/%change in GDP
The other aspect of decreasing 'employment elasticity of growth' (as shown in the article) is that to produce the same output we require less labour and this also means that our labour is becoming more productive which is basically happening because of use of more capital/machines.
RAMP is a World Bank assisted Central Sector Scheme of Rs. 6062 crore in which Rs. 3750 is loan from the World Bank and rest is funded by Govt. of India. It is a 5 year scheme starting from 2022-23.
The scheme aims at:
1) Strengthening institutions and governance at the Centre and State level 2) Improving Centre-State linkages and partnerships 3) Improving access of MSMEs to market and credit, 4) Technology upgradation 5) Addressing issues of delayed payments 6) Greening of MSMEs
RAMP programme, through enhanced collaboration with States, will be a job-enabler, market promoter, finance facilitator, and will support vulnerable sections and greening initiatives. RAMP will complement the Atma Nirbhar Bharat mission by fostering innovation and enhancement in industry standards, practices and provide the necessary technological inputs to the MSMEs to make them competitive and self reliant, enhancing exports, substituting imports, and promoting domestic manufacturing.
RAMP has been formulated and proposed by the Government of India for strengthening MSMEs in line with the recommendations made by U K Sinha Committee, KV Kamath Committee and Economic Advisory Council to the Prime Minister (PMEAC).