FDI in services sector up 26% to $8.68 billion in FY17

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FDI inflows in the services sector rose by about 26% to $8.68 billion in 2016- 17 with the government taking steps to improve ease of doing business and attracting foreign investments.

The services sector, which includes banking, insurance, outsourcing, research and development, courier and technology testing, had received foreign direct investment (FDI) worth $6.89 billion in 2015-16, according to data of the Department of Industrial Policy and Promotion (DIPP).

The government has taken several measures such as fixing timeliness for approvals and streamlining procedures to improve ease of doing business in the country and attract foreign investments.

With FDI growth in key sectors like services and telecom, the overall foreign investment inflows in the country too increased by 9% to $43.5 billion last fiscal.

Increasing FDI inflows in the services sector assumes significance as it contributes over 60% to India’s gross domestic product. The sector accounts for about 18% of the total FDI India received between April 2000 and March 2017, followed by key sectors such as computer software & hardware, construction development and telecommunications.

To further boost FDI inflows in the sector, the government is considering relaxation of policy in areas like single brand retail, multi-brand retail, print media and construction. The government is also focusing on enhancing services exports. It is organizing global services exhibition besides the commerce and industry ministry is looking at relax norms in areas like higher education to attract foreign players.

Foreign investments are considered crucial for India, which needs around $1 trillion for overhauling its infrastructure sector such as ports, airports and highways to boost growth. A strong inflow of foreign investments helps improve the country’s balance of payments situation and strengthen the rupee value against other global currencies, especially the US dollar.

Source: http://www.livemint.com/Money/oqGqFei9Aeuk00ls8ZgXLI/FDI-in-services-sector-up-26-to-868-billion-in-FY17.html

Japan plans world’s fastest supercomputer

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Presently, Sunway TaihuLight supercomputer, remains the world’s most powerful computer.

Japan plans to build the world’s fastest-known supercomputer in a bid to arm the country’s manufacturers with a platform for research that could help them develop and improve driverless cars, robotics and medical diagnostics.

The ministry of economy, trade and industry will spend 19.5 billion yen ($173 million) on the previously unreported project, a budget breakdown shows, as part of a government policy to get back Japan’s mojo in the world of technology. The country has lost its edge in many electronic fields amid intensifying competition from South Korea and China, home to the world’s current best-performing machine.

In a move that is expected to vault Japan to the top of the supercomputing heap, its engineers will be tasked with building a machine that can make 130 quadrillion calculations per second—or 130 petaflops in scientific parlance—as early as next year, sources involved in the project told Reuters.

At that speed, Japan’s computer would be ahead of China’s Sunway Taihulight that is capable of 93 petaflops. “As far as we know, there is nothing out there that is as fast,” said Satoshi Sekiguchi, a director general at Japan’s ‎National Institute of Advanced Industrial Science and Technology, where the computer will be built.

The push to return to the vanguard comes at a time of growing nostalgia for the heyday of Japan’s technological prowess, which has dwindled since China overtook it as the world’s second-biggest economy.

Prime Minister Shinzo Abe has called for companies, bureaucrats and the political class to work more closely together so Japan can win in robotics, batteries, renewable energy and other new and growing markets.

Deep learning

In the area of supercomputing, Japan’s aim is to use ultra-fast calculations to accelerate advances in artificial intelligence (AI), such as “deep learning” technology that works off algorithms which mimic the human brain’s neural pathways, to help computers perform new tasks and analyze scores of data.

Recent achievements in this area have come from Google’s DeepMind AI program, AlphaGo, which in March beat South Korean professional Lee Seedol in the ancient board game of Go.

Applications include helping companies improve driverless vehicles by allowing them to analyze huge troves of visual traffic data, or it could help factories improve automation. China uses the Sunway Taihulight for weather forecasting, pharmaceutical research, industrial design, among other things.

Japan’s new supercomputer could help tap medical records to develop new services and applications, Sekiguchi said. The supercomputer will be made available for a fee to Japan’s corporations, who now outsource data crunching to foreign firms such as Google and Microsoft, Sekiguchi and others involved in the project said.

The new computer has been dubbed ABCI, an acronym for AI Bridging Cloud Infrastructure. Bidding for the project has begun and will close on 8 December. Fujitsu Ltd, the builder of the fastest Japanese supercomputer to date—the Oakforest-PACS, capable of 13.6 petaflops, declined to say if it would bid for the project. The company has, however, said it is keen to be involved in supercomputer development.

Source: http://www.livemint.com/Science/tvHE1Qa3EshJdFSkiqCoxK/Japan-plans-worlds-fastest-supercomputer.html

With GST on its way, India rises to second spot on global biz optimism index

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India improved its ranking by one spot in a global index of business optimism, with policy reforms and Goods and Services tax (GST) expected to become a reality soon, says a survey.

According to the latest Grant Thornton International Business Report, India was ranked second on the optimism index during the third quarter (July-September 2016).

Indonesia took the top spot, with the Philippines coming in third.

India was ranked third during the April-June period after being on top for two consecutive quarters.

“The improvement in the optimism ranking in the recent past clearly reflects that the reform agenda of the government and its efforts on improving the climate for doing business are having an impact,” Grant Thornton India LLP Partner – India Leadership Team Harish H V said.

High business optimism was also complimented by the rise of employment expectations. India regained its top position on this parameter, from second position in the April-June period, while profitability expectations also moved up.

“…all the programs and initiatives of the government as well as its focus on building relationships with all major economic powers has made India a bright spot in the global economy,” Harish said, adding the recent push for GST augurs well and should give a further boost to business optimism.

While India continues to be amongst the top five countries citing regulations and red tape as a constraint on growth, for the first time in the year, the country’s ranking on this parameter has dropped from second to fourth.

As per the survey, 59 per cent of the respondents have quoted this as an impediment in the growth prospects compared to 64 per cent in the previous quarter.

The report is prepared on the basis of a quarterly conducted global business survey of 2,500 businesses across 36 economies.

Meanwhile, in terms of revenue expectations, India slipped to third position from top in the previous quarter.

In spite of the downturn, India is much ahead of China where only 30 per cent respondents expect an increase in revenue, whereas in India, 85 per cent respondents have voted in favour of increasing revenue.

The survey further noted that 68 per cent of respondents have voted for an upsurge in selling prices. On this parameter too, China lags India with only 10 per cent of respondents expecting an upsurge in selling prices. The global average is 19 per cent.

Globally, business optimism stands at net 33 per cent, rising 1 percentage point from the previous quarter but falling 11 percentage points over the year.

“Political events such as Brexit and the US presidential election understandably rattle the global economy and test the resilience and elasticity of businesses worldwide. In general, businesses do not like uncertainty, and that is what is happening,” Grant Thornton Global CEO Ed Nusbaum said.

Source : http://economictimes.indiatimes.com/articleshow/55277143.cms

 

India rises to 66th rank in innovation

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India had been faring poorly for several reasons over the years, largely related to poor infrastructure, performance in education, intellectual property and so on.

Reversing a trend of declining rankings every year, India rose by 15 positions to become the 66th most innovative nation in the world. India’s neighbour China also improved its ranking slightly and broke into the club of 25 top innovative nations in the world.

The Global Innovation Index has been created and reported every year by the Paris-based business school Insead, Cornell University and the World Intellectual Property Organisation, a United Nations agency. The Gobal Innovation Index is positioned as resource for policy makers, to identify areas of possible improvement in innovation. It is based on 82 variables across seven areas, grouped into two divisions — inputs and outputs for innovation.

India had been faring poorly for several reasons over the years, largely related to poor infrastructure, performance in education, intellectual property and so on.

This year it has done well largely based on good performances on information technology services exports and creative goods exports.

Source : http://economictimes.indiatimes.com/articleshow/53716047.cms

Foreign capital flow into EMs climbs to $25 billion

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Emerging markets (EMs) have witnessed an inflow of $25 billion from foreign portfolio investors in this month so far, says a report.

Equity flows were the dominant driver this month, with an estimated $14.6 billion in inflows, while debt flows were more moderate at $10.2 billion, according to the report by the Institute of International Finance.
Inflows were dominated by EM Asia, followed by Latin America, while EM Europe and Africa, West Asia saw modest outflows.

“Regionally, EM Asia saw total inflows of $19.1 billion, followed by Latin America with inflows of $8.7 billion, while there were modest outflows from EM Europe and AFME,” the report noted.

Portfolio flows to EMs rose to $24.8 billion in July from $13.3 billion in the preceding month. Prior to that, EMs saw an outflow of $12.3 billion in May.

“In fact, July marked only the second month over the past year where portfolio flows were above their long-term average of $22 billion,” it added.

The recovery in flows during the past few months follows a period of exceptional weakness in EM portfolio flows that began with China’s mini-devaluation almost a year ago and saw cumulative outflows of $81 billion from EMs, compared to $96 billion during the global financial crisis.

Source: http://www.business-standard.com/article/markets/foreign-capital-flow-into-ems-climbs-to-25-billion-116072800946_1.html

India signs five agreements with Tanzania

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Seeking to enhance its ties with resource-rich Tanzania, India on Sunday extended its full support to the country to meet its development needs and signed five agreements, including one for providing a Line of Credit of $92 million in the water resources sector.

Describing India as a trusted partner in meeting Tanzania’s development priorities, Mr. Modi said he along with President John Pombe Joseph Magufuli “agreed to deepen overall defence and security partnership, especially in the maritime domain.”

“Our in-depth discussions on regional and global issues reflected our considerable convergence on issues of common interest and concern,” he said at a joint press interaction after his bilateral meeting with President Magufuli.

Twin threats

The two leaders agreed to work closely, bilaterally, regionally and globally to combat the twin threats of terrorism and climate change.

In a joint statement, the two leaders expressed their strong condemnation of terrorism in all its forms and manifestations and stated that there could be no justification for terrorism whatsoever. They expressed satisfaction on the holding of bilateral counter-terrorism consultations in early 2016.

“India’s cooperation with Tanzania will always be as per your needs and priorities,” Mr. Modi said.

The two sides signed an agreement under which India would provide a Line of Credit of $ 92 million for rehabilitation and improvement of Zanzibar’s water supply system.

Other agreements signed included an MoU on water resource management and development, an MoU for establishment of vocational training centre at Zanzibar, an MoU on visa waiver for diplomatic/official passport holders and an agreement between the National Small Industries Corporation of India and the Small Industries Development Organisation, Tanzania.

The Prime Minister said the two countries were also working on a number of other water projects for 17 cities in Tanzania.

Source: http://www.thehindu.com/news/national/narendra-modis-africa-visit-india-extends-92-mn-line-of-credit-to-tanzania/article8831464.ece

Brexit to hit eurozone growth, says IMF

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The International Monetary Fund has cuts its economic growth forecasts for the eurozone in the wake of the UK’s vote to leave the European Union.

The eurozone is expected to grow by 1.6% this year and 1.4% in 2017. Before the referendum the IMF had predicted growth of 1.7% for both years.

The IMF also revised down its 2018 growth forecast to 1.6% from 1.7%.

It said medium-term growth prospects for the 19-member bloc were “mediocre” due to high unemployment and debt.

Mahmood Pradhan, deputy director of the IMF’s European Department, said the outlook could worsen if drawn-out negotiations between the UK and the EU led to a continuation of recent trends in financial markets – where investors have shunned riskier assets.

“If that risk aversion is prolonged, we think the growth impact could be larger and at this point, it is very difficult to tell how long that period lasts,” he said in a conference call.

The revised 2017 figure was the IMF’s “best case” scenario, assuming a deal was struck that allowed the UK to retain its access to the EU’s single market, Mr Pradhan said.

However, if the UK decided not to maintain close ties with the EU and chose to rely on World Trade Organization rules, there could be “major disruptions,” he said.

Mr Pradhan added it was “very, very early days to have any strong sense of confidence” about what the eventual relationship between the UK and EU would be.

In the medium-term, challenges such as high unemployment and persistent structural weaknesses in the euro area would continue to weigh on growth, the IMF said.

“As a result, growth five years ahead is expected to be about 1.5%, with headline inflation reaching only 1.7%,” the report said.

It also said that as the euro area was such a big player in world trade, any slowdown could have an impact on other economies, including emerging markets, but it expected this to be “limited”.

Source: http://www.bbc.com/news/business-36743862