There have been key developments on the Indian economic front and global leadership views on the vast potential growth were displayed in recent interactions. The digitization of regulatory procedures continues to a focus of the Government with allocation of time, effort and suitable resources. Regional economic partnerships are progressing as per requirements with the aim of ensuring increased trade and revenue generation.
IMF Leadership Thoughts – India will need a highly skilled and educated workforce to transition to a developed economy, along with larger investments to wipe out gaps in critical infrastructure, Gita Gopinath, the first deputy managing director of the International Monetary Fund (IMF), recently said during her visit to India. The India-born economist spoke at a chat session with NK Singh, the chairman of the 15th Finance Commission, as part of the diamond jubilee conference of the prestigious Delhi School of Economics (DSE). She was answering Singh’s question on what it would take for India to become a developed country, beyond just the “hard” per-capita income criterion given India’s strong growth and well-blended monetary and fiscal policies. Average years of schooling in India are still lower than many other countries, Gopinath said. “India also needs to invest more in infrastructure. It is already making investments in public and digital infrastructure but there’s still a big gap,” the former alumna of DSE said. Asia’s third-largest economy will also need robust institutions that support its development, including efficacy of judicial systems, she said. Labour-market flexibility, land reforms and keeping trade open are crucial for faster development, the IMF official said. The IMF’s latest economic growth forecast for India was covered by Asia Law Portal here.
ASEAN-India Trade in Goods Agreement – The 5th Joint Committee and related meetings for review of ASEAN-India Trade in Goods Agreement (AITIGA) were held in ASEAN Secretariat, Jakarta, Indonesia from 29th July to 1st August 2024, marking a significant milestone in enhancing economic cooperation between ASEAN and India. Delegates from all 10 ASEAN Countries and India participated in the meeting. AITIGA Joint Committee had initiated discussions for review of AITIGA in May 2023 and after finalising its Terms of Reference and Negotiating Structure, AITIGA JC and its Sub-Committees started negotiations in February 2024. The first 2 rounds of negotiations were held in February 2024 in New Delhi and in May 2024 in Putrajaya, Malaysia (all covered by Asia Law Portal, with the last update here). During the 3rd round of negotiations in Jakarta, Indonesia, all 8 Sub-Committees dealing with ‘National Treatment and Market Access’, ‘Rules of Origin’, ‘Standards, Technical Regulations and Conformity Assessment Procedures’, ‘Sanitary and Phytosanitary’, ‘Legal and Institutional Issues’, ‘Customs Procedures and Trade Facilitation’, ‘Trade Remedies’ and ‘Economic and Technical Cooperation’ met alongside 5th AITIGA JC and held substantive discussions making significant progress during this round. All the Sub-Committees reported the outcomes of their discussions to the 5th AITIGA JC which provided them further guidance to steer their future work. ASEAN is an important trade partner of India with about 11% share in India’s global trade. The review of AITIGA, signed in 2009, will help create further opportunities for businesses on both sides to enhance the level of India-ASEAN trade.
Moody’s Ratings – Moody’s Ratings recently revised India’s economic growth forecast upwards to 7.2% for 2024 and to 6.6% for 2025 from its earlier estimates of 6.8% (as reported by Asia Law Portal here) and 6.4%, respectively, citing strong broad-based growth. The New York-based rating company said it recognised potentially higher growth forecasts for India if the cyclical momentum, especially for private consumption, gains more traction. “The (Indian) economy expanded 7.8% year-over-year in the first quarter of 2024 despite the persistence of tight monetary policy and demonstrated progress on fiscal consolidation. Both the industrial and services sectors have recorded strong performances, with the services PMI in particular remaining above 60 since the beginning of the year,” Moody’s said in a report titled ‘Global Macro Outlook 2024-25 (August 2024 Update). In its report, Moody’s Ratings said the Indian economy is in a sweet spot, with a mix of solid growth and moderating inflation.
Foreign Portfolio Investors – Foreign Portfolio Investors (FPIs) were net buyers of Indian equities in August, purchasing shares worth Rs 7,320 crore. The total investments by them now stand at Rs 42,886 crore, so far in 2024. In July, FPIs bought domestic shares worth Rs 32,365 crore while in June, they were net buyers at Rs 26,565 crore after remaining net sellers in April and May when they sold equities worth Rs 8,671 crore and Rs 25,586 crore respectively. In February and March they were net buyers at Rs 1,539 crore and Rs 35,098 crore after starting the year on a negative note in January when they offloaded shares worth Rs 25,744 crore. On Friday, the foreign institutional investors (FIIs) were net buyers at Rs 5,318.14 crore while the domestic institutional investors (DIIs) were net buyers at Rs 3,198.07 crore.
Computerisation of Courts – After Phase-I and Phase-II, the Union Cabinet had last year approved Phase-III of eCourts Project, at an outlay of Rs.7,210 crore for a period of 4 years starting from 2023 onwards. This computerisation of courts initiative was earlier reported by Asia Law Portal here. The e-Courts Phase-III aims to usher in a regime of maximum ease of justice by moving towards digital, online and paperless courts through digitization of the entire court records including legacy records and by bringing in universalization of e-Filing/ e-Payments through saturation of all court complexes with e-SewaKendras. It will put in place intelligent smart systems enabling data-based decision making for judges and registries while scheduling or prioritizing cases. The main objective of the Phase-III is to create a unified technology platform for the judiciary, which will provide a seamless and paperless interface between the courts, the litigants and other stakeholders. The project will help provide a smoother user experience by building a “smart” ecosystem. Registries will have less data entry and minimal file scrutiny facilitating better decision-making and policy planning. The eCourts Phase-III may prove to be a game changer in ensuring ease of justice by making the Court experience convenient, inexpensive and hassle free to all the citizens of the country.
