Economy Picks Up In FY24 Last Quarter; RBI Dividend To Government Likely To Be Rs 1 Trillion

Better Than Expected Growth Of 6.8 Per Cent In FY24 Last Quarter

The Indian economy has done better than expected by growing 6.8 per cent in the last quarter of FY 2023-24, the Economic Times reported quoting the median forecast of a poll of 15 economists. 

Propelled by strong growth momentum and strengthening demand, the strong quarter could lift overall gross domestic product (GDP) growth for the full fiscal year to 7.8 per cent against 7.6 per cent assessed in the government's first advance estimates released in February. The International Monetary Fund has also forecast 7.8 per cent growth for FY 2023-24. The government will release fourth-quarter growth numbers and provisional GDP data for FY 2023-24 on May 31. Read more

India To Build Own Foundational Model For Artificial Intelligence

The Indian government plans to build its own version of a foundational model for artificial intelligence (AI) which will be customised for use by Indian companies, entrepreneurs, academics and researchers, the Economic Times reported.

There will be an initial outlay of Rs 2,000 crore for the ambitious project which is likely to be launched after the elections. The initiative may be led by the IndiaAI Innovation Centre to be set up by the ministry of electronics and information technology under the Rs 10,000 crore IndiaAI Mission. India will join countries such as China and the US that are already building foundational models for general or specific use in defence and agriculture. More here

RBI Bulletin Expects FY25 First Quarter Growth At 7.5 Per Cent

Rising aggregate demand and non-food spending in rural India is likely to push India’s GDP growth by 7.5 per cent in the first quarter of the current financial year, Moneycontrol reported quoting an article in the RBI’s May bulletin.

The Indian economy has demonstrated marked resilience in the face of geopolitical headwinds impacting the supply chain, said the article on the state of the economy. "According to the economic activity index (EAI), activity rebounded in April, and early estimates suggest that GDP growth for Q1:2024-25 is likely to remain close to 7.5 per cent," it said. More here

RBI Dividend Of Rs 1 Trillion Could Meet Budget Deficit Target

The Reserve Bank of India is expected to pay up to Rs 1 trillion ($12 billion) as dividend to the Central government, Business Standard reported quoting a Bloomberg report. Economists said the move would boost New Delhi’s coffers and help meet its budget deficit target.

RBI directors are likely to approve a dividend ranging between Rs 80,000 crore to Rs 1 trillion. That compares with a transfer of Rs 87,420 crore last year and the government’s own target of Rs 1.02 trillion, which includes dividends from state-controlled banks. If the RBI pays out a dividend worth Rs 1 trillion, it will be the highest in five years. More here

Finance Ministry Asks Public Sector Banks To Review IT Systems

The Finance Ministry has instructed public sector banks (PSBs) to review their information technology systems, especially the disaster recovery channels, the Business Standard reported. 

The official said the RBI conducts its own audits regularly and has requested major PSBs to evaluate disaster recovery channels, where banks maintain data in parallel. If a bank headquartered in Mumbai stores backup data in another seismic zone, if one channel stops functioning, the other will automatically activate without causing any disruptions for customers, the official said. On May 18, the Indian stock markets, such as BSE and NSE, conducted special trading sessions in the equity and derivative segments to evaluate their disaster preparedness in the event of major disruptions. More here

Heavy Industries Ministry Blacklists Hero Electric, Benling

The Ministry of Heavy Industries has debarred Hero Electric and Benling India from participating in any of its electric vehicle incentive programmes in future, the Business Standard reported.

The action follows the ministry’s findings that the two companies violated phased manufacturing programme guidelines. The government seeks to recover around Rs 200 crore from the two. The ministry had deregistered Hero Electric, Okinawa Autotech, Greaves Electric, Benling India, Revolt Intellicorp, and Amo Mobility from FAME in May last year. They were asked to pay back Rs 469 crore. Amo, Greaves, and Revolt returned the subsidies with interest. The others didn’t. More here