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Dear Readers

Wishing all a Merry Christmas and a prosperous New Year.

On 27th November, 2023 we celebrated Guru Nanak’s Birthday. Guru Nanak realized God by singing virtues of God, following a life of good deeds and selfless service to the people. His songs are songs of love, truthful service for the welfare of all with total surrender to God. His Gurbani has been sung by all following Sikhism and by others as well.

Remember the Supreme Lord in prosperity and adversity. God is one. Call Him Rama, Krishna, Khudah, and Allah in whatsoever name.

Christianity is followed globally. A world wide belief of Santa Claus still persists today who comes and blesses the children’s all around with gifts and enjoyment. Jesus Christ gives the message of loving Lord and to be pure at heart. God blesses those who are pure in heart with a love for Lord, follows righteous path and so on.

Indian Economy: Standard & Poor’s (S & P) the global rating agency reported that the Indian economy will grow at a faster rate. Standard & Poor’s (S & P) revised upwards India’s Gross Domestic Product (GDP) growth rate at 6.4% in FY24 from the earlier projection of 6%. It however lowered the growth projection for FY25 from 6.9% to 6.4%. International Monetary Fund (IMF), World Bank, Asian Development Bank (ADB) and Fitch expected GDP to be at 6.3% in the current year. The government and Reserve Bank of India (RBI) expect GDP growth at 6.5% for FY24, though it has grown at 7.8% in Q1FY24 and at 7.6 % in Q2FY24.

Government is positive about not overshooting the target of fiscal deficit in FY24.

Industry has requested the government to simplify and restructure the tax structure to bring parity or lowering the tax rates and capital gain tax. Global tax correction on capital gains and dividends will promote overseas investment and additional investments by all.

Corporate credit growth is mainly due to buoyancy in services. Industrial credit growth is muted to nearly 7% and service at 25%. Government CAPEX alone cannot sustain long term high growth rate.

Private CAPEX is affected by so many factors. Any person who envisages growth or has a grudge against any industrialist/businessman, simply file an FIR. Investigation starts affecting the goodwill of both the promoters and the enterprise.

Marginal Private CAPEX investment is not enough for growth. Capacity utilization is higher for infrastructure, ancillary, healthcare and FMCG sectors. There is a need for investment positively in these and all other sectors as well to have higher growth and to be one of the largest developed Nation.

According to Goldman Sach’s the global investment bank, India offers the most promising long term growth opportunity. India’s share gain of Foreign Direct Investment (FDI) has been larger in comparison to the competing countries in the region over the years, although overall Foreign Direct Investment (FDI ) in FY23 has fallen a bit vis-à-vis FY22. Goldman Sachs expects India to take further measures on capital spending for growth of employment and economy. FM Nirmala Sitharaman said that the government may provide all support for the growth of the Blue economy (maritime sector) as it seems to have the potential for growth of employment and exports.

India, in order to grow, has to provide peace, security, safety and a clean environment to the people. Government is upbeat about creating a conducive environment for business to flourish.

Cover Story: Real estate industry is the highest employment generator after the agricultural sector. It contributes about 7.3% to India’s Gross Domestic Product (GDP) while agriculture contributes around 18 – 19 %. Number of industries like steel, cement, bricks, house building materials is linked to this sector, as are plenty of upstream and downstream services like masonry, plumbing, carpentry, electric wiring etc.

Real estate sector is expected to grow to 12 fold to about USD 5.25 trillion by 2047 from the present size of USD 477 billion and is expected to contribute to 15.5 % to Gross Domestic Product (GDP) from the existing 7.3%, claimed a report titled “India Real Estate: Vision 2047” released by realtors’ body National Real Estate Development Council (NAREDCO) and property consultant Knight Frank India.

The basic needs of human being are food, clothing and housing. Demand for housing in the urban areas has risen sharply as more and more people are migrating from the rural to urban areas for work. As such, the demand has increased in urban areas with preference for a single unit for a nuclear family and demand for work space as well. Land is very expensive now. High cost of land and building materials has been continuously pushing up the price of real estate. Availability of land is also limited. High-rise buildings are constructed to combat the issue.

Convenient finance from banks, Non – Banking Financial Companies (NBFCs) and Housing Finance Companies (HFCs) is adding to the demand. Inflow of foreign funds has also contributed to the growth of this sector.

Government, both Central and State, should ease the various regulations and lower the registration charges.

Smart city projects of the Central government are expected to solve the problem of high pollution and congestion in urban areas.

IBC: Recovery rate under Insolvency and Bankruptcy Code (IBC) has fallen from 43% to 34% between March ’19 to September’ 23. Resolution time on an average has increased to 653 days. It has been further pushing the enterprises in metros. The situation can improve if lenders are allowed to restructure stressed loan accounts with reconsideration of interest rates and non-levy of penalty.

Conclusion: Currently India is the 5th largest economy in the world but expects to surpass Japan by attaining a size of USD $33 - 40 trillion by 2047.

Since the last 2 – 3 years, only a few large conglomerates are making investments, that too on a case – to – case basis. Their focus is more on reducing their debts.

For becoming a driver of global growth, animal spirit of the wealth and job creators need to be revived so that they can take risk and start making fresh investments. For this, the existing regulations need to be reviewed and relaxed wherever necessary.

As ordered by the Supreme Court, lenders must give time to hear the problems of the borrowers to impart natural justice.

After the successful resolution plan, panel action/measures should not apply to the borrowers of the enterprise which had earlier failed to service loans due to external factors and their names should be removed from the Willful Defaulters List (WDL).

Foreign investment has increased in the stock market along with retail investment. The stock market has touched USD 4 trillion which is higher than our Gross Domestic Product (GDP).

Investment growth of 30% is considered important for driving economic growth.