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Economic slowdown: Moody’s cuts India’s growth forecast to 5.8 per cent

Moody’s slashed its growth forecast for India to 5.8% due to economic slowdown caused by long-lasting factors like rural fiscal stress and unemployment

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[vc_row][vc_column][vc_column_text]Moody’s Investor Services today – Thursday, Oct 10 – slashed its 2019-20 growth forecast for India to 5.8% from 6.2% earlier, saying the economy was experiencing a pronounced slowdown which is partly related to long-lasting factors, fiscal stress among rural households and muted job creation.

What began as an investment-led slowdown has broadened into consumption, driven by financial stress among rural households and weak job creation, said the rating agency.[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_column_text css=”.vc_custom_1570707574002{border-top-width: 10px !important;border-right-width: 10px !important;border-bottom-width: 10px !important;border-left-width: 10px !important;padding-top: 10px !important;padding-right: 10px !important;padding-bottom: 10px !important;padding-left: 10px !important;background-color: #cecece !important;border-radius: 10px !important;}”]Moody’s projection is the most pessimistic so far, according to a media report, lower than Reserve Bank of India’s last week’s forecast of 6.1%, and comes ahead of International Monetary Fund’s (IMF) growth projections due next week.

Last month, Asian Development Bank (ADB) and the Organisation of Economic Co-operation and Development (OECD) lowered FY20 growth forecast for India by 50 basis points and 1.3 percentage points to 6.5% and 5.9%, respectively.

Last week, the Reserve Bank of India (RBI) also slashed its growth projection for the economy by 80 basis points, from 6.9% to 6.1%, for 2019-20.

Rating agency Standard & Poor’s (S&P) has also cut down its India growth forecast to 6.3% from 7.1% earlier.

In June, Fitch cut India’s growth forecast for the current fiscal for a second time in a row to 6.6 per cent. It had earlier in March lowered the growth estimate for 2019-20 to 6.8 per cent, from 7 per cent projected earlier, on weak momentum of the economy.[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]Moody’s said in its report: “The drivers of the deceleration are multiple, mainly domestic and in part long-lasting.”

Moody’s said a prolonged phase of softer growth in India would dampen prospects for the government’s fiscal consolidation plans and hamper its ability to prevent a rise in the debt burden, thus constraining the country’s sovereign credit profile.

“While we expect a moderate pick-up in real GDP growth and inflation over the next two years supported by monetary and fiscal stimulus, we have revised down our projections for both. We forecast real GDP growth to decline to 5.8% in the fiscal year ending in March 2020 (fiscal 2019) from 6.8% in fiscal 2018, and to pick up to 6.6% in fiscal 2020 and around 7.0% over the medium term. Compared with only two years ago, the probability of sustained real GDP growth at or above 8% has significantly diminished,” it added.

The Indian economy is battling a severe demand slowdown and liquidity crunch which resulted in economic growth rate falling to a six-year low of 5% in the June quarter, while growth in private consumption expenditure slumped to an 18-quarter low of 3.1%.

The rating agency said what began as an investment-led slowdown has broadened into consumption, driven by financial stress among rural households and weak job creation. “A credit crunch among non-bank financial institutions (NBFIs), major providers of retail loans in recent years, has compounded the problem,” it added.

Moody’s said prospects for fiscal consolidation look limited, though rapid deterioration is also unlikely. “With the recently announced corporate tax cuts and lower nominal GDP growth, we now expect a central government deficit of 3.7% of GDP in fiscal 2019, marking a 0.4 percentage point slippage from its target. A prolonged period of slower nominal GDP growth not only constrains scope for fiscal consolidation, but also keeps the government debt burden higher for longer compared with our previous expectations,” it added.

India’s real GDP growth has declined in each of the past five quarters, falling to 5 per cent year-on-year in April-June 2019 from 8.1 per cent in January-March 2018.

“By international standards, 5 per cent real GDP growth remains relatively high, but it marks a low rate for India. Combined with a marked decrease in inflation in recent years, this has resulted in a material decline in nominal GDP growth from typical annual rates of 11 per cent or higher over the past decade, to around 8 per cent in the second quarter of 2019,” it said.

While private investment has been relatively weak since 2012, consumption — which makes up about 55 per cent of GDP — had remained robust. “However, private consumption growth has now also fallen quite sharply, to 3.1 per cent in the second quarter from 7.3 per cent in the first. This was the lowest rate of quarterly consumption growth since October-December 2014, and high-frequency consumption demand indicators (such as automobile, truck, two-wheeler and tractor sales) point to continued weakness,” it said.

The government has estimated that the corporate tax cut will reduce revenue by around Rs 1.45 lakh crore or about 0.7 per cent of GDP in 2019-20. “After factoring in exclusions for tax exemptions and the recent 0.3 per cent of GDP transfer of capital from the RBI, we expect a central government fiscal deficit of about 3.7 per cent of GDP in 2019-20, resulting in a slippage of 0.4 percentage points of GDP from the government’s target of 3.3 per cent,” Moody’s said.

As a result, the general government deficit, which at about 6.4 per cent in fiscal 2018 is already much larger than those of Baa-rated peers (median of 2.5 per cent), is likely to remain wider than Moody’s previously expected, it added.[/vc_column_text][/vc_column][/vc_row]

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Happy Birthday Mark Zuckerberg: Social media users wish Facebook co-founder on his 40th birthday

Born on May 14, 1984, Zuckerberg has grown from a Harvard dropout into a billionaire philanthropist, owning many tech ventures over the years. He started Facebook in 2004 and took it public in 2012.

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Mark Zuckerberg, co-founder and CEO of Facebook (Meta), is celebrating his 40th birthday on May 14. Zuckerberg, one of the most influential figures in the tech industry, has had a major impact on how people connect and communicate with each other all over the world.

At 40, Zuckierberg continues to lead Facebook and its parent company, Meta, towards new technological frontiers. Born on May 14, 1984, Zuckerberg has grown from a Harvard dropout into a billionaire philanthropist, owning many tech ventures over the years. He started Facebook in 2004 and took it public in 2012.

In 2021 the social media platform changed its name to Meta to shift the company’s focus to the metaverse. Under his leadership, Facebook has grown into a global platform with over 2.8 billion active users. Apart from this, he has also expanded his influence through the Chan Zuckerberg initiative, which is run by Zuckerberg and his wife Priscilla Chan and focuses on philanthropy in health, education, and scientific research with an investment of 99% of the couple’s wealth over their lifetime.

There has been a rise in the net worth of Mark Zuckerberg over the last few years. According to Forbes, his net worth stands at $177 billion, which makes him the 4th richest man in the world. Since Facebook (now Meta) acquired WhatsApp in 2014 for $19 billion, Mark Zuckerberg’s net worth has grown significantly.

In 2014 his net worth was approximately $26.1billion, which now stands at around $177 billion, which reflects a substantial increase in the net worth due to Meta’s expanding business and strategic acquisitions over the year.

Before Zuckerberg turned 40, he gifted himself a brand-new superyacht, Launchpad in March 2024. According to reports, Zuckerberg purchased $59 million worth of waterfront property on Lake Tahoe in California in 2019. He spends his money on luxury vehicles and owns a Acura TSX, a Honda Fit, and a black Volkswagon Golf GTI.

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Google restores delisted Indian apps after government intervention

Google on Saturday restored all Indian apps it had removed.

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Google has started to restore all the delisted Indian mobile apps on Play Store agian, which they had removed due to a disagreement over service fees. After a discussion between company representatives and IT Minister Ashwini Vaishnaw, the decision was made, according to sources.

The step was taken in response to Vaishnaw’s strong statement in which he said that it is not allowed for apps to be removed from the Google Play Store. The minister had said, India is very clear, our policy is very clear…our startups will get the protection that they need.

Vaishnaw  continued saying that he has already given Google a call. They will be speaking with the app developers who were delisted this week. This is not acceptable. The minister said this kind of delisting cannot be permitted.

Ten Indian companies’ apps were banned by Google on Friday, causing outrage in one of its fastest-growing markets. With 94% of phones running on its Android platform, Google holds a large portion of the Indian market. Popular names like Naukri and Bharatmatrimony were on the list.

The main point of contention is Google’s in-app purchase fees, which range from 11% to 26%. Indian startups have long opposed the US tech giant’s actions, believing them to be unfair.

The founder of Bharat Matrimony, Christian Matrimony, Muslim Matrimony, and Jodii, Matrimony.com, expressed shock at the matchmaking apps’ removal from the Google Play Store.

Shaadi. Com CEO Anupam Mittal described it as a dark day for India’s internet, highlighting the possible broad effects on matchmaking services. He also called Google an evil.

While, Kuku FM Co-founder Vinod Kumar Meena in a statement had said that Google was behaving like a monopoly.

Meanwhile, Google temporarily withdrew the famous Indian payments app Paytm from the Play Store in 2020, claiming a few policy infractions. Due to this decision, the founder of the company as well as the larger startup community came together to build their own app stores and file lawsuits against Google.

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Anant Ambani says he is 100% lucky to get Radhika Merchant in his life

Anant Ambani said he was grateful to get Radhika as his life partner. He said he is 100% lucky to get Radhika Merchant in his life. He said every day he is falling more and more in love with her. He added although he had known Radhika for the last 7 years, it felt he had met her only yesterday. He thanked Radhika for everything.

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Anant Ambani and Radhika Merchant’s grand three-day wedding celebrations began with a glamorous cocktail night on Friday in Jamnagar. During the celebrations, Anant Ambani also gave a speech wherein he thanked his late grandfather Dhirubhai Ambani and grandmother Kokilaben Ambani for inspiring him. Anant Ambani said he was grateful to get Radhika as his life partner. He said he is 100% lucky to get Radhika Merchant in his life. He said every day he is falling more and more in love with her.

He expressed his gratitude to his mother for pulling together the lavish three-day wedding celebrations in Jamnagar. Anant thanked his mother for all she had done. He said all the arrangements had been done by his mother and nobody else. He added his mother had gone all out and she had worked 18-19 hours a day and he was extremely grateful to her.

He also thanked all the guests who were present there at the pre-wedding celebrations. He said everyone had made it to Jamnagar to make him and Radhika feel special. He said both of them were honored and humbled to have all of them present there. Anant said he was sorry if they had caused an inconvenience to anyone. He asked for forgiveness. He hoped everyone is going to enjoy the coming three days. He also thanked his mother, father, sister, brother, his sister-law and his brother in-law for making this event memorable.

Anant said everyone has been sleeping for less than 3 hours a day for the last 2-3 months and he was very happy to share this joy with everyone. The youngest Ambani talked about his personal struggles and how his parents had always supported him. He further added his life had not been entirely a bed of roses. He said he had also experienced the pain of thorns. He said he had faced many health crises.

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