Morning Brief: GDP Growth Slows To 7.1%; Shah Panel Indicts Reliance; Sex CD Scandal Rocks AAP

Growth Slows Down

The latest GDP data shows that India grew at 7.1 percent during April-June, slowest in the last six quarters. The GDP growth for the same quarter last fiscal was 7.5 percent.

Gross Value Added (GVA) growth stood at 7.3 percent, higher than GDP growth. GDP is calculated by adding net indirect taxes (indirect taxes - subsidies) to GVA. It means that the net tax bump for the government has declined (or subsidies increased).

The growth in mining (–0.4%) and construction (1.5%) is really disappointing. Investment demand continues to remain negative and declined further. Construction sector growth of 1.5 percent compared to that of 5.6 percent in the last fiscal was also discouraging.

However, manufacturing (9.1% vs 7.3% year on year) and electricity (9.4% vs 4% y-o-y) sectors showed good improvement.

The numbers show that the Economy is not firing on all cylinders and only a few sectors are driving growth. Good monsoon and increase in the consumption, thanks to 7th pay commission rollout, can change things for better in coming months.

Indicted

The Justice AP Shah committee probing the dispute between ONGC and Reliance Industries has submitted its report to the government. The report indicts RIL for encroachment as it retained the gains of the gas which flowed into its KG D6 field from adjacent fields of ONGC. The report also pulls ups ONGC for filing complaint six years after it came to know about gas from its field flowing into RIL’s field.

The panel has said that the government, and not the ONGC deserves the compensation from RIL. The government has endorsed the findings of the panel and set a one-month deadline to resolve the dispute.

Hooda-Vadra Land Deal

Another much-awaited report that got submitted yesterday was by Justice SN Dhingra. The Haryana government had appointed him last year to probe various suspect land deals in Gurgaon including some linked to Robert Vadra. It was alleged that Hooda’s Congress government in the state bent rules to favour Vadra.

The report hasn’t been made public but Justice Dhingra says that he has named each and every person who is responsible—whether private or government, including their roles.

Permanent Residence Status

The central government will give permanent resident status (with the option for multiple visits) to foreign investors who bring in a minimum of Rs 10 crore and generate 20 jobs every year. Aimed at supporting ‘Make In India’ and encouraging job creation, the permanent residence status will be available for 10 years and can be extended by another 10 years.

AIR In Pak

The Centre has boosted the signal capacity of All India Radio (AIR) transmission by installing a new 300 KV Digital Radio Mondial (DRM) transmitter in Jammu. Now its programmes can be broadcast to the regions of Pakistan Occupied Kashmir in addition to the Punjab province.

AIR is also planning to focus on its news service in Baluchi language. Though it already runs some programmes, now an enhanced news bulletin is being planned in the same language.

CDgate

Aam Aadmi Party has fired its minister for social welfare, women and children, Sandeep Kumar. Party chief Arvind Kejriwal said that he received an “objectionable” CD of the minister after which the decision to sack him was taken.

However, according to media reports, the so-called objectional CD was handed over to Kejriwal a couple of weeks back but he didn’t take any action. Only when the whistleblower handed over the CD to the media, he sprang into action.

WB Ranking

India has jumped 19 places up in the latest Logistics Performance Index (LPI) ranking released by the World Bank. It improved its standing from 54 in 2014 to 35 this year (2016).

India’s score went up from 3.08 to 3.42. Germany tops the rankings. The US, with a score of 3.99, stands at 10th. China is at 27th with a score of 3.66.

If India keeps the same pace of improvement, it should overtake China by 2018.

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We hope you enjoyed reading our morning brief. Have a great day ahead!

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