{Article} Economy: Highlights of the Mid-Year Economic Analysis Dec, 2012

{Article} Economy: Saral Money scheme

• The government has announced the launch of Saral Money, which brings banking services for the unbanked by tying five banks through a Visa payment gateway, using the Aadhar unique ID number as a proxy for cumbersome Know Your Customer (KYC) norms.
• The five banks that are part of Saral Money scheme include SBI, HDFC Bank, ICICI Bank, Indian Overseas Bank and Axis Bank.
• The key to the new solution is Visa network, which integrates and links the different systems being operated by banks with the government’s national identity database. This means Saral Money is not restricted to a specific bank or region.
• Prior to this customers would have had to provide numerous documents to fulfill KYC requirement, which was a big deterrent for marginalised.
• The benefits to the consumer come from the ability to receive payments direct to the Saral Money and use it to withdraw or remit those payments to family members. For the government, it helps improve transparency and efficiency while driving the country’s electronic payment and financial inclusion agenda.

{Education} Article: India's rank in UHNWI, Quality of Living and City Infrasture

Ultra high net worth individuals (UHNWIs) are individuals or families who have, by one definition, at least US$30 million in investable assets, or with a disposable income of more than US$20 million. The exact dividing lines depend on how a bank wishes to segment its market; for example, the term "very high net worth individuals" can refer to those with assets between $5 million and $50 million, with ultra high net worth individuals only those with above $50 million.

{Education} Article: Problem, Reason and Solution for Indian Fiscal Deficit

• The government has outlined the strong fundamentals of the economy and said it was committed to rein in fiscal deficit within the target of 5.3% of gross domestic product.
• The government is battling hard to avert a ratings downgrade from the rating agencies like Moody or S&P and has taken a series of measures to demonstrate its commitment to economic reforms. 
• Finance Minister had a meeting with the officials of Moody. The meeting comes a day after another ratings agency Fitch cautioned that a loosening in fiscal policy ahead of the 2014 elections could further weaken India's public finances and put pressure on ratings.
• It also warned that policy slippage or mounting evidence of a structural decline in the trend growth rate, such as protracted weak economic data, could cause the ratings to be downgraded.

{Education} Article: Transparency International's Corruption Perception Index 2012

• India's image on tackling corruption has not improved with Transparency International's Corruption Perception Index (wiki link included)  placing it at 94th rank out of 176 nations this year.
• Though India was ranked at 95th position last year, the international watchdog said it has started evaluating the positions through a different formula beginning this year and hence this cannot be compared to last year's ranking.
• However, the last year's rank of 95 would be 96 if it is calculated using the new methodology which implies there was a "slight improvement" in the index.
• This year, India has a score of 36 out of 100 on a scale from 0 (highly corrupt) to 100 (very clean) which is a result of an average of 10 studies including World Bank's Country Performance and Institutional Assessment and Global Insight Country Risk Ratings.
• India was ranked 72 among 180 countries for the first time in 2007 and since then the country's rankings have been showing a decline. While India was placed at 87 in 2010, the position was 95 in 2011.
• This year, India is ranked below neighbouring countries like Sri Lanka (79) and China (80), while Afghanistan, Iran, Nepal, Pakistan and Bangladesh fared much worse than India when it came to corruption in public sector undertakings.
• Denmark is placed at the top spot with a score of 90 while Finland and New Zealand follow very closely. Countries that occupy the bottom ranks in the index are Myanmar, Sudan Afghanistan, Somalia and North Korea.

Transparency International's Corruption Perception Index

{Education} Article: Global gold demand

• The World Gold Council said that global gold demand in 2013 should be led by strength in Chinese demand and a recovery in India.
• Chinese gold demand is likely to grow around 10% in 2013 from about 800 tonnes this year, as the world's second-largest economy is expected to pick up pace, helping the precious metal continue its bull run into its 13th year.
• Referring to a nearly 30% fall in Indian demand in the first half of this year (hurt by a slowing economy and record-high gold prices in local currency terms), it gave the positive projection for Indian gold sector and said that the demand should rebound after falling about 20-25 percent in 2012 to 750-800 tonnes.
• It also cited other drivers for his projections for higher demand in 2013, including robust Western investment demand due to lingering global financial problems and purchases by central banks.
• Global gold demand is likely to fall by around 5 to 7 percent in 2012 to around 4,100 tonnes, it added.
• "Looking at data we have on imports into India and also premiums in Mumbai, demand's been very strong so far in Q4 in India, I think actually stronger than in China," it said, adding that gold purchases before the Lunar New Year will help boost China's demand in the fourth quarter.
• Gold has been up around 10 percent so far this year at about $1,730 an ounce.

{Education} Article: Gold prices have almost doubled in the last three years

• After declining for two straight quarters, gold demand made a strong recovery in the third quarter, surging 27% during July-September, as an appetite for investment in the yellow metal returned and jewellers stocked up for the festive season.
• Latest data released by the World Gold Council, the agency promoting sales of the yellow metal globally, showed that demand for gold went up to to Rs 65,373 crore, even as global sales fell 14% due to depressed economic sentiment in various countries, including China where demand dipped 8%. 
• A part of the jump in sales in India was on account of a sharp depreciation of the rupee but in volume terms too there was an increase of 9%. Global sales were, however, 11% lower at 1,085 tonnes with India accounting for one-fifth share with total sales estimated at 223 tonnes.
• The spurt in price as well as customs duty levied by the government had dampened the demand for gold, a favoured savings instruments for most Indian households. But in the September quarter, consumers seemed to have gone back to purchasing gold after postponing their buying decision due to high prices. 
• While gold jewellery demand in India picked up 25% due to restocking by retailers ahead of the wedding season, investment demand, which fell 37% during April-June, registered a 27% rise too. 
• Gold prices have almost doubled in the last three years and increased 14% in the last one year, causing buyers to be cautious about purchases.
• While retailers witnessed significant dip in purchases in the previous quarters, the period between Dussehra and Diwali turned out to be positive with sales value rising 30-35% as compared to the previous quarter.

{Education} Article: Inflation in India is among the highest in the Asian region

• Inflation eased to an eight month low in October but was still above the Reserve Bank of India’s (RBI) comfort level which could complicate the policy choice for the central bank.
• Data released by the government showed the the annual rate of inflation, based on monthly wholesale price index, stood at 7.45% in October as compared to 7.81% for the previous month and 9.87% during the corresponding month of the previous year. However, the worrying sign was the upward revision of the August figure to 8.01% from the previous estimate of 7.55%.
• Inflation in India is among the highest in the Asian region and is one of the key factors which has prompted the RBI from easing interest rates.
• In the latest policy review the RBI reduced the cash reserve ratio — the amount of funds that the banks must keep with the central bank — by 25 basis points and said there was a “reasonable likelihood of further policy easing in the fourth quarter of this fiscal year”. But it cautioned that the guidance will, “however, be conditioned by the evolving growth-inflation dynamic.”
• Inflationary pressures have remained stubborn with food inflation emerging as a major challenge for policy makers. 
• Latest data shows that consumer price inflation has also inched up and is hovering near double-digits.
• Current data showed some easing in pressure on vegetables, fruit and milk prices but it held up for cereals, pulses, eggs, meat and fish. Cereal prices rose an annual 14.35% in October while pulses prices shot up 20%. Eggs, meat and fish rose 13.82% year-on-year.

{IRA} Hu was best for China's economy?

{Infographic} Global Factory Activity & Greece Austerity Push