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Bangladesh to receive $900 mn World Bank financing for sustainable growth

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Bangladesh to receive $900 mn World Bank financing for sustainable growth

Dhaka, June 22 (IANS) The World Bank’s Board of Executive Directors has approved two projects totalling $900 million to help Bangladesh strengthen fiscal and financial sector policies and improve urban infrastructure and management to ensure sustainable and climate-resilient growth.

“Decisive reforms will help Bangladesh sustain growth and strengthen resilience to climate change and other shocks,” Abdoulaye Seck, World Bank country director for Bangladesh and Bhutan, was quoted as saying in a statement received on Saturday.

“These new financing operations will help Bangladesh in two critical areas — the financial sector and urban management — to achieve its vision of upper-middle-income status,” he added.

The Second Recovery and Resilience Development Policy Credit ($500 million) — the last in a series of two credits — supports fiscal and financial sector reforms to accelerate sustainable growth and build resilience to future shocks, including climate change, reported Xinhua news agency.

“A well-functioning financial sector is critical for Bangladesh to increase investment and improve access to finance for those left out of formal banking systems,” said Bernard Haven, World Bank Senior Economist and Task Team Leader for the program.

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The Resilient Urban and Territorial Development Project ($400 million) will help improve climate-resilient and gender-responsive urban infrastructure and urban management capacities in seven city clusters along the economic corridor covering over 950 km of the highway from Cox Bazaar in the south to Panchagarh in the north of Bangladesh.

“This will be the first in a series of projects helping build resilience to climate change and create new opportunities and jobs in secondary cities through spatially targeted investments,” said Kwabena Amankwah-Ayeh, World Bank Senior Urban Development Specialist and Task Team Leader for the project. “Developing secondary cities as growth hubs will be critical for the country’s sustainable growth.”

–IANS

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What small traders from Varanasi expect from the Union Budget

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What small traders from Varanasi expect from the Union Budget

What small traders from Varanasi expect from the Union Budget

Varanasi, July 22(IANS) Common people have high hopes from the Union Budget 2024-25 which will be presented in the Parliament on Tuesday.

Speaking to IANS, small traders from Prime Minister Narendra Modi’s Lok Sabha constituency Varanasi have shared their thoughts on the Union Budget.

Chandanlal, who runs a Banarasi saree business, said, “We have a lot of expectations from the Modi government, including reduction of GST on Banarasi sarees. There is high demand for our art and tradition, but due to increasing GST, sales are decreasing. If the government provides some help to promote our business, Banarasi sarees can reach people at lower prices.”

Surya, who runs a guest house in Varanasi, told IANS, “The government should put an end to the commission given to brokers who bring guests to hotels or guest houses. Also, the GST on stays is very high. Even if a guest stays for one day, he or she will have to pay 12 per cent GST. To promote tourism, the government should reduce GST.”

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Another trader said, “We hope the government will provide tax relief to small businesses. Also, the prices of goods used in restaurants, such as lentils and raw materials are increasing. The government should address this problem faced by the small traders like us.”

Another trader from Varanasi hopes that the government will present a Budget that provides relief to both traders and the common people.

“The government should ensure that people do not get disappointed with the Budget. Also, the government needs to reduce taxes.”

–IANS

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Economic Survey: Non-farm sectors to play important role in job generation (IANS Opinion)

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Economic Survey: Non-farm sectors to play important role in job generation (IANS Opinion)

Economic Survey: Non-farm sectors to play important role in job generation (IANS Opinion)

New Delhi: The Economic Survey 2023-24 has brought out the importance of non-farm sectors in the growth trajectory of the Indian economy.

The farm sector always remains high on the political agenda for obvious reasons and hence the non-farm sector often has to take a back seat.

However, the Economic Survey 2023-24 notes that the Indian economy needs to generate an average of nearly 78.5 lakh jobs annually until 2030 in the non-farm sector to cater to the rising workforce.

The Survey mentions that there is a scope to supplement the existing schemes of Production Linked Incentive (60 lakh employment generation over 5 years), MITRA Textile scheme (20 lakh employment generation), MUDRA, etc., while boosting their implementation.

Gig Economy

Incidentally, gig economy seems to have emerged as a front-runner for creating employment opportunities in the non-farm sector.

According to NITI Aayog’s indicative estimates based on national labour force survey data, in 2020–21, 77 lakh workers were engaged in gig economy, and as per the Economic Survey 2023-24, the gig workforce is expected to expand to 2.35 crore and form 6.7 per cent of the non-agricultural workforce or 4.1 per cent of the total livelihood in India by 2029-30.

In this context, it is important to develop a social security mechanism for this new workforce. More importantly, there is an urgent need to upgrade the skills of gig workers so that there is a continuous upward move in this sector.

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Gig workers are largely semi-skilled or unskilled workers. Their skills upgradation would ensure that there is an upward mobile workforce, a healthy sign for any economy.

Rise of Corporates

The good news is that India’s corporate sector’s profitability was at a 15-year high in FY24 with profits quadrupling between FY20 and FY23. The Economic Survey mentions that businesses have an obligation to strike the right balance between the deployment of capital and the deployment of labour.

“In their fascination for AI and fear of erosion of competitiveness, businesses have to bear in mind their responsibility for employment generation and the consequent impact on social stability,” says the Survey.

Artificial Intelligence

The Economic Survey also indicated that the Modi government is seized of the fact that AI is a double-edged sword and one needs to utilise it properly before it gets too late.

It is also a great disruptor. Highlighting the need for research and development in this sector, the Economic Survey 2023-24 mentions a policy brief that suggests a need for an inter-agency coordination authority for AI which would act as a central institution guiding the research, decision-making, and policy planning on AI, and job creation.

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The government has launched several initiatives to ensure an AI-enabled ecosystem and to connect AI to the youth of the country. Some of these include ‘Future Skills Prime’, a national programme for school students titled ‘YUVAi’ (Youth for Unnati and Vikas with AI), and ‘Responsible AI for Youth 2022’.

A budget of Rs 10,300 crore has been provided in 2024 for the India AI Mission, a significant move to strengthen the AI ecosystem.

Services Sector

According to the Economic Survey, the services sector continues to be a significant contributor to India’s growth, accounting for about 55 per cent of the total size of the economy in FY24.

As per the provisional estimates, the services sector is estimated to have grown 7.6 per cent in FY24. The gross GST collection reached Rs 20.18 lakh crore in FY24, marking 11.7 per cent increase from the previous year, underscoring robust domestic trading activity.

Business activity in the services sector in the country transcended the obstacles of the pandemic and other disruptions worldwide.

In March 2024, the services Purchase Manager Index (PMI) soared to 61.2, marking one of the sector’s most significant sales and business activity expansions in nearly 14 years.

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Post-pandemic, services exports have maintained a steady momentum and accounted for 44 per cent of India’s total exports in FY24, the Survey notes.

India ranked fifth in services exports, with other countries being the European Union (excluding intra-EU trade), the United States, the United Kingdom, and China.

India’s growing reputation as the preferred destination for Global Capability Centres (GCCs) by multinational corporations has significantly boosted software and business services exports.

India’s share in digitally delivered services exports globally increased to 6 per cent in 2023 from 4.4 per cent in 2019. This rise in services exports, coupled with a fall in imports, led to an increase in net services receipts on a YoY basis during FY24, which helped cushion India’s current account deficit.

There are multiple reasons for this growth, including significant domestic demand, rapid urbanisation, expansion of e-commerce platforms generated heightened requirements for logistics, and digital-related services.

It is important to note that the government has played a crucial role in fostering the growth and competitiveness of India’s services by creating an enabling environment, promoting investment, enhancing skills, and facilitating market access.

(Singapore-based Indian entrepreneur Deepshikha Kumar is the founder-director of SpeakIn. The views expressed are personal)

–IANS

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India's GDP growth for FY25 to surpass Economic Survey's forecast: CII

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India's GDP growth for FY25 to surpass Economic Survey's forecast: CII

India's GDP growth for FY25 to surpass Economic Survey's forecast: CII

New Delhi, July 22 (IANS) The Economic Survey 2023-2024 is positive about the India growth story, and India’s GDP growth for FY25 will surpass the forecast and has the potential to reach 8 per cent, Sanjiv Puri, President, Confederation of Indian Industry (CII), said on Monday.

The Economic Survey, tabled by Union Finance Minister Nirmala Sitharaman in the Parliament, projects India’s GDP growth rate at 6.5 to 7 per cent for 2024-25 as it sees the economy on a strong wicket.

According to Puri, the GDP growth for FY25, which is imminently achievable, is driven by excellent macro-financial management, and a facilitative policy environment which includes a thrust on capex and inflation control.

“CII is confident that, going forward, the Indian economy has the potential to achieve 7 per cent plus growth backed by a consensus between the Centre, states, and the private sector on the reform agenda,” he said in a statement.

Labour-intensive sectors such as tourism, care economy and food processing sector have the potential to increase employment in the economy, which is critical.

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“The Survey is spot-on in terms of the six key areas unveiled for Amrit Kaal namely boosting private investment, growth and expansion of MSMEs which is referred to as India’s Mittelstand; agriculture as a growth engine, financing green transition, bridging the education-employment gap and building state capacity and capability,” Puri emphasised.

Similarly, the focus on improving the quality of life in the hinterland and emphasis on the social sector such as healthcare, would go a long way to empower the marginalised and ensure that every Indian becomes a stakeholder in New India, said the apex industry chamber.

–IANS

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Union Budget: Experts urge govt to remove 18 pc GST on mental health services

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Union Budget: Experts urge govt to remove 18 pc GST on mental health services

Union Budget: Experts urge govt to remove 18 pc GST on mental health services

New Delhi, July 22 (IANS) The government must remove or limit the 18 per cent Goods and Services Tax (GST) on mental health services, and allocate resources strategically to help India become a mentally resilient society, experts said on the eve of Union Budget presentation on Monday.

Mental health is a key area of concern that can have a significant impact on the productivity and economy of the country.

“Mental health issues are highly prevalent, yet are poorly managed and are affecting a significant number of our population. In the upcoming Budget, we urge the government to remove or reduce the 18 per cent GST on mental health services,” Jyoti Kapoor, Founder & Director of Manasthali Wellness, told IANS.

According to experts, with declining mental health, there has been an increase in the need for health insurance policies that cover both physical and mental health.

Unfortunately, people are not reporting these conditions as the cost of the available medications and therapies often proves challenging.

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Divya Mohindroo, counselling psychologist, highlighted the need for comprehensive policies to handle India’s mental health crisis and the need to increase the workforce in the sector.

“Out of an estimated 150 million people needing mental health services, only fewer than 30 million seek help,” Mohindroo told IANS.

“Lack of mental health professionals is crippling in India, with merely 0.3 psychiatrists, 0.07 psychologists, and 0.07 social workers available per 100,000 people,” she added.

“There should be specific measures for mental health, and we are hopeful the Budget will prioritise this urgent issue. There is an immediate need to strengthen India’s mental health workforce, with just one psychiatrist per two lakh people,” Mohindroo said.

She also suggested “scholarships to train professionals to help reduce this gap”.

The experts also suggested incorporating mental health services into healthcare insurance coverage.

“While government centres receive some relief, private practitioners are left burdened. Extending tax benefits to private practitioners is crucial, given the high operational costs for the average therapist. In addition to acknowledging the financial difficulties experienced by private practitioners, this change would help lower the cost and increase public accessibility to mental health care,” Kapoor said.

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“This will help our citizens access mental healthcare without burdening them financially,” added Mohindroo.

–IANS

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Sensex ends lower ahead of Union Budget 2024-25

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Sensex ends lower ahead of Union Budget 2024-25

Sensex ends lower ahead of Union Budget 2024-25

Mumbai, July 22 (IANS) Indian equity indices closed in red on Monday following profit booking before the Union Budget 2024-25 which will be presented in the Parliament on Tuesday.

At close, Sensex was down 102 points or 0.13 per cent at 80,502, while the Nifty fell 21 points or 0.09 per cent to 24,509.

According to the Economic Survey which was presented in the Parliament on Monday, the GDP growth rate has been estimated at 6.5-7 per cent for the current financial year.

Buying was seen in the midcap and smallcap stocks on Monday.

The Nifty Midcap 100 index closed 716 points or 1.28 per cent higher at 56,624 points, while the Nifty Smallcap 100 index closed 165 points or 0.90 per cent higher at 18,563 points.

NTPC, UltraTech Cement, HDFC Bank, M&M, Tata Steel, Power Grid, Tata Motors, Sun Pharma, L&T, Maruti Suzuki, and Infosys were the top gainers in the Sensex, while Wipro, Reliance, Kotak Mahindra Bank, ITC, and SBI were the top losers on Monday.

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Among the sectoral indices, Auto, PSU Bank, Fin Service, Pharma, Metal, and Infra were the major laggards, while IT, FMCG, Realty, and Energy were the major gainers.

As per the experts, the conservative economic growth forecast for FY25, presented in the Economic Survey, has introduced some spikes in volatility ahead of the Budget. Further, the below-estimated Q1 results from certain index heavyweights added to apprehensions of a slowdown in earnings growth in FY25.

–IANS

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