MF has upgraded its forecast for China’s economy, projecting a 5% annual growth rate for this year, up 0.4 percentage points from an earlier estimate. This upgrade is based on strong first-quarter growth and recent measures to support the property sector.
However, the IMF emphasized the need for consumer-friendly reforms to sustain high-quality growth, such as stronger social safety nets and higher workers’ incomes. It also recommended scaling back manufacturing subsidies to benefit other industries like services.
While praising China’s focus on clean energy and advanced technology, the IMF highlighted the importance of a comprehensive policy approach to address economic challenges.
News Corp has entered a multi-year deal with OpenAI to share news content for both training and answering user questions. OpenAI will have access to current and archived materials from major News Corp publications like The Wall Street Journal, Barron’s, and The Daily Telegraph.
The deal, potentially worth over $250 million over five years, is part of OpenAI’s broader strategy of licensing deals with media companies such as The Associated Press, Axel Springer, Prisa Media, Le Monde, and the Financial Times.
Unlike some previous agreements focused solely on training, this deal also allows OpenAI to use the content to respond to user inquiries. This contrasts with The New York Times’ approach, which sued OpenAI and Microsoft over similar uses of its content.
S&P Global Ratings upgraded India’s sovereign outlook to ‘positive’ for the first time in ten years, citing improved public spending quality and expected continuity in reforms and fiscal policies.
India’s rating remains at BBB-. The agency indicated a possible upgrade within 24 months if India maintains cautious fiscal and monetary policies, reducing government debt and interest burden while enhancing economic resilience.
Finance Minister Nirmala Sitharaman attributed the positive outlook to macroeconomic reforms, fiscal discipline, and substantial capex outlays. S&P highlighted India’s robust economic growth, improved government spending on infrastructure, and commitment to fiscal consolidation as key factors.
The agency projects near 7% growth over the next three years, supported by strong consumer and public investment dynamics. The fiscal deficit target is set to decrease to 4.5% by FY26, with further reductions expected by FY28. S&P’s upgrade reflects confidence in India’s long-term growth prospects and policy stability.
In the 12 months leading to May 2024, domestic funds in India have significantly increased their investment in equities to a record ₹2.7 lakh crore ($32 billion), compared to ₹1.2 lakh crore by foreign portfolio investors (FPIs).
This marks a substantial shift from a decade ago, when FPIs were more bullish, investing ₹75,784 crore, while domestic funds were net sellers of ₹18,858 crore. The change is attributed to FPIs’ discomfort with financial stocks, attractive Chinese market valuations, and rising US treasury yields.
In contrast, during the 2019 elections, both FPIs and domestic funds were net buyers. The equity portfolio value of domestic funds rose by 55% year-on-year to ₹36.5 lakh crore by April 2024, making up one-fifth of the total institutional equity AUM in India.
IRDAI has issued a new circular aimed at improving health insurance services by reducing settlement times and ensuring cashless claim processes. Key directives include:
- 100% Cashless Claims: Insurers are to achieve full cashless claim settlement, limiting reimbursement claims to exceptional cases.
- Quick Authorisation: Insurers must decide on authorisation requests within one hour of receipt.
- Discharge Requests: Final authorisation must be given within three hours of receiving a discharge request from hospitals. Delays beyond this timeframe require insurers to cover additional hospital costs from shareholders’ funds.
- Policy Cancellation: Policyholders can now cancel policies with a 7-day notice, down from the previous 15-day grace period.
- Grace Period for Premium Payments: The grace period is set at 15 days for monthly premiums and 30 days for quarterly premiums.
Insurers are to implement these guidelines by July 31, 2024.
Lenders have requested a one-month extension from the government to comply with the Liberalised Remittance Scheme (LRS) for international credit card spends, aiming for a new deadline of June 30.
LRS permits Indian residents to remit up to $250,000 abroad annually for various purposes, with a 20% tax collected at source on amounts exceeding ₹7 lakh per fiscal year. Despite the government’s decision to include forex transactions through credit cards under this scheme, banks need additional time for customer awareness, staff training, and system calibration.
RBI has advised banks to establish a standard operating procedure, but final guidelines from the government are still pending.
The Asian Development Bank (ADB) pledged $2.6 billion in sovereign lending to India in 2023 for projects aimed at enhancing urban development, industrial corridor projects, power reforms, climate resilience, horticulture, and connectivity.
Additionally, ADB committed over $1 billion for private sector projects, $23.53 million in technical assistance, and $4.1 million in grants. ADB’s country director for India, Mio Oka, emphasized the focus on accelerating structural transformation, job creation, infrastructure development, green growth, and social inclusiveness.
The bank also supports gender empowerment, resource mobilization, regional integration, and capacity development. Key projects funded include the Visakhapatnam-Chennai Industrial Corridor, urban services in multiple states, and the Delhi-Meerut rapid rail transit corridor.