China May Pip USA to Become World largest Economy by 2030 : Report

China May Pip USA to Become World largest Economy by 2030

As per the latest report by Deutsche Bank, the economic and financial status of emerging market economies such as India and China will continue to do well in the future and the recent downturn will help accelerate the trend.

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Report also suggests that the (BRIC) economies” increasing size will be making itself increasingly felt in the world markets, ranging from trade and investment to commodity markets.

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Meanwhile, the BRIC economies of Brazil, Russia, India and China are likely to achieve significant growth in future.

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Meanwhile, BRIC nations are already ranked among the top 10 on a PPP (Purchasing Power Parity) basis.

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The impressive economic growth rates and greater participation in global trade and financial flows by the BRIC economies are re-shaping the global economic and financial architecture of these economies.

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It is expected that with the constant present growth of the BRIC economies, political, economic and financial realities  of the world is going to change to the extent that China will replace the US as the World”s largest economy by 2030.

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All the four big BRIC economies carry at least one investment grade rating, currently, at the same time.

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Moreover, China”s and Russia”s international status has been enhanced due to their substantial holdings of government controlled foreign assets.

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INFLATION – “THE SILENT CREEPER” Part 2

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Hello Friends here we come up with an extension of our previous blog, INFLATION –  “THE SILENT CREEPER”.

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Inflation Silent Creeper Part 2

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In previous Blog we had touched upon the impacts of inflation on economy in current scenario and the reasons for the inflation.

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Now in this part we would look into the possible Measures to check inflation.

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Measures to check inflation:

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•  To give immediate relief from inflationary pressure, government is planning to check the supply deficiency.

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It has allowed importing sugar.

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It will import rice, as rice production is expected to drop in 2010.

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Import duties on oil seeds have been slashed.

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•  Money supply should be checked, otherwise in the time of scarcity excess liquidity will accelerate inflation further.

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•  Distribution process should be very fast and transparent.

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Currently we need a well managed and coordinated distribution of stocks through PDS (Public Distribution System), open market sales of public stocks etc.

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Hoarding should be avoided here and government should keep an eye on this.

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•  This rising inflation has become a major threat for economy.

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The only key way to check the inflation is to bridge the gap between demand and supply, which may control the price rise.

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•  Unfortunately, Indian agriculture is characterized by low input and low output systems.

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Hence we have to increase the productivity.

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For example: Yield of paddy in India is only 2.9 tonnes/hectare as compared to 7.5 tonnes/hectare in US.

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•  Check the rising cost of cultivation.

Increasing land, labour, fertilizers and other inputs are discouraging farmers to produce more in absence of sufficient liquidity.

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•  Apart from grain, government should also create buffer stocks or strategic reserve of oil seeds and other crop, so that it can release it at the time of crisis.

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Next Blog we would try to know about the other concerns in Indian economy regarding the parameters to check inflation.

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Stay Tuned for more on this.

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At 19.95%, Food Prices at 10-yr High

Hello Friends here we come up with the Latest Agri Commodities updates across the globe.

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At 19.95%, food prices at 10-yr high

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At 19.95%, food prices at 10-yr high

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“Save people from price rise” cry got louder with a parliamentary panel asking the Manmohan Singh government to act on speculative trading and hoarding of commodities.

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He was also asked by panel to end the diversion of agriculture land for manufacturing,  as food prices rose to a decade-high of 19.95% for the week ended December 5.

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Prices, mainly that of food articles, are zooming because of a fall in production due to the worst monsoon in about three decades.

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The supply shortfall is getting amplified, with traders pushing up prices with cheap money, as central banks, including India’s, are keeping policy rates at record lows to prevent economies from falling into depression.

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Potato prices more than doubled in the week ended December 5 from a year earlier, vegetable prices climbed 41.09%, pulses price rose 40.1% and wheat advanced 13.9%, the government data showed.

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🙂

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In Other major Commodities Updates, Sugar output in India has declined owing to drought in India.

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Drought lowers sugar production by 9.6% :

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Sugar output in India, the biggest grower after Brazil, fell 9.6% in the first two months of the season that began 1 October, said an official at the Indian Sugar Mills Association.

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Mills produced 1.7 million tones (mt), down from 1.88mt a year ago, as drought hurt the cane crop and a price dispute delayed crushing, the official said.

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He didn’t want to be identified as the information was not public.

Mills reported lower sugar recovery than a year earlier, he said.

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Separately, the government has asked states to help lift stocks of imported sugar, which have filled up warehouses, junior farm minister K.V. Thomas said on Thursday.

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