Economy News Notes

On Monday, the rupee fell to below its all-time low of Rs.51.97 (reached in March 2009) when it breached Rs.52 during intraday trading.
A combination of domestic and global factors is behind the rupee's fall. Economic growth is slackening.
The widening current account deficit and the critical reliance on short-term capital flows to bridge it are adding to the pressure on the rupee.
Recent export figures have dashed hopes that exporters would continue their sterling performance of the first seven months and help in containing the merchandise trade deficit.
A depreciating rupee makes India's imports costlier. Many items, notably petroleum, have an inelastic demand.
Anticipating a further decline, many exporters are holding on to their proceeds, while importers have been rushing to buy dollars to cover their imports.
What is intriguing is the Reserve Bank of India's rather passive stance in the face of such large declines in the home currency. It is possible that, in its assessment, the size of forex reserves is not large enough to defend the rupee in what promises to be a period of prolonged uncertainty and financial market volatility.
The expectation is that debt flows to India will increase and that would relieve the pressure on the rupee to some extent.

Despite global economic challenges, enterprises will continue to invest in information technology (IT) and IT spending in India is projected to total $79.8 billion in 2012, a 9.1 per cent increase from 2011
worldwide IT spending will reach nearly $3.7 trillion in 2011. Out of this, emerging economies will account for $1.013 trillion.
Businesses are increasingly looking to IT to help support the challenges of enhancing customer support, supply chain management, optimising business processes or helping drive innovation in the business
These demands are being placed on IT in an environment in which the infrastructure (hardware and software) foundation of IT within many enterprises may not be entirely in place.
IT is also in transition from being viewed as a back-office support function to a frontline business-focussed function.
The telecommunications market is the largest IT segment in India with IT spending forecast to reach $54.7 billion in 2012, followed by the IT services market with a spending of $11.1 billion.
The computing hardware market in India is projected to reach $10.7 billion, and software spending will total $3.2 billion.
Where data centres will give way to data clouds, mobile devices become windows into personal clouds. Personal computing will become massive collaborative computing, and information technologies will be overshadowed by information ecologies.

The Prime Minister agreed that Kerala, along with States such as Punjab and West Bengal, was having debt stress, and told Mr. Chandy that it was everybody's responsibility to control debt.
The Kerala team took up the issue of giving the classical language status to Malayalam
Mr. Chandy brought to the notice of the Prime Minister the need for a change to, or clarification about, the cabotage law, which restricted the freedom of foreign containers to move along the Indian coast.
He met Health Minister Ghulam Nabi Azad and sought Central assistance for the endosulfan victims. Mr. Azad promised all support feasible under the National Rural Health Mission.