'BoP: Some grey areas remain' - Economic Survey - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks


Login Failure
(Please do not use this option on a public machine)
  Sign Up | Forgot Password?  

'BoP: Some grey areas remain' - Economic Survey

Mar 1, 2000

    The Current Account
  • Exports have grown by 12.9% during April - December 1999 in US$ value terms. The growth of imports has been lower art 9%, despite the surging oil prices (import value of oil grew 58%). This has been largely due to a sharp decline in imports of precious metals - gold and silver, and a 30% drop in the imports of capital goods

  • In the invisible goods category, the software sector continued to log in 50% growth rates.

  • As a consequence of the adverse external climate (oil imports), the current account deficit is expected to widen to 1.6 - 1.8% of GDP (FY99: 1% of GDP).

    The Capital Account of the Balance of Payments

  • During April - September 1999, total inflows were US$ 4.3 bn as compared to 3.1 bn in the corresponding period last year.

    US$ mApril - Sept 98April - Sept 99
    Portfolio investments (FII)(540)1,349
    Non resident deposits46932
    Foreign direct investment (FDI)1,4081,057
    External commercial borrowings ECB)4,328*62
    * including US$ 4.2 bn from Resurgent India Bonds (RIB)

  • The war like situation in Kargil and the uncertainity in the political situation seems to have adversely affected the inflow of funds into the country. However, as is evident from the euphoria in the stock markets, FII inflows have continued unabated.

  • The Economic Survey has drawn attention to the slack in FDI given that the government has set a target of US$ 10 bn per annum of FDI inflows. It has been stated that with the government expanding the automatic approval system, the FDI inflows can be expected to pick up.

    Foreign Exchange Reserves

  • The forex reserves had increased by over US$ 2.4 bn by the end of January 2000. The external situation continues to be stable.

    One key fact brought out by the Economic Survey is that there has been a sharp fall in the imports of capital goods during the year. This is of prime concern as it signifies that investment activity in the domestic markets has yet to pick up. The sustainability of economic growth is determined by both consumption and investment activity and therefore a further delay in the pick up the latter could jeopardise the upturn in domestic economic activity.

    Source: Economic Survey 2000, Ministry of Finance

Equitymaster requests your view! Post a comment on "'BoP: Some grey areas remain' - Economic Survey". Click here!


More Views on News

Ride the Indian Real Estate Revival with this 'Different' Smallcap Stock (Profit Hunter)

Mar 23, 2021

Affordability in the housing segment has never been so good in last one and a half decade. Here's how you could make the most of it...

My Latest Stock Recommendation (Fast Profits Daily)

Oct 9, 2020

How I picked an exciting stock using trends from both the commodity and equity markets.

Data is the New Oil but It's Also the New Sugar. Here's How to Fight it (Profit Hunter)

Jun 1, 2020

Is too much data hurting your quest for market beating returns?

Quantum Mutual Fund: Hum woh nahi hain (The Honest Truth)

Apr 29, 2020

Ajit Dayal on how the mutual fund industry robs you of your wealth.

This One Trigger Could Turnaround Yes Bank's Stock Price (The 5 Minute Wrapup)

Oct 16, 2019

If Yes Bank manages to do this, it could be the start of a much-needed turnaround for the bank.

More Views on News

Most Popular

Hotel Stocks Will Reward Investors (Fast Profits Daily)

Jun 8, 2021

This is why I'm bullish on the hotel and hospitality sector.

My 'Unlock' Investments (Fast Profits Daily)

Jun 11, 2021

The best unlock investments you can make in the market.

The Most Visible Sign of India's Revival is on Two Wheels (Profit Hunter)

Jun 9, 2021

Investing in the best stocks could result in wealth compounding on a massive scale.

How I Discovered a 400-Year-Old Open Secret to Extreme Wealth (Profit Hunter)

Jun 11, 2021

Charlie Munger's open secret about investing success.


India's #1 Trader
Reveals His Secrets

Secret To Increasing Your Trading Profits Today
Get this Special Report,
The Secret to Increasing Your Trading Profits Today, Now!
We will never sell or rent your email id.
Please read our Terms