David Fuller and Eoin Treacy's Comment of the Day
Category - India

    Ericsson Mobility Report

    Thanks to a subscriber for this report which reflects on the growth of the global telecommunications sector. Here is a section on India:  

    In India, GSM/EDGE-only has remained the dominant technology during 2018, accounting for around 56 percent of total mobile subscriptions at the end of this year. However, the country has experienced strong growth in the number of LTE subscriptions over the last couple of years, and at the end of 2018 LTE will account for close to 30 percent of all mobile subscriptions. As the transformation toward more advanced technologies continues in India, LTE is forecast to represent 81 percent of all mobile subscriptions at the end of 2024. 5G subscriptions are expected to become available in 2022. The Middle East and Africa comprises over 70 countries and is a diverse region.  It varies from advanced markets which have mobile broadband subscription penetration of 100 percent, and emerging markets where around 40 percent of mobile subscriptions are for mobile broadband. At the end of 2018, more than 20 percent of all mobile subscriptions will be for LTE in the Middle East and North Africa, while in Sub-Saharan Africa, LTE will account for just over 7 percent of subscriptions. The region is anticipated to evolve over the forecast period and, by 2024, 90 percent of subscriptions are expected to be for mobile broadband. Driving factors behind this shift include a young and growing population with increasing digital skills, as well as more affordable smartphones. In the Middle East and North Africa, we anticipate commercial 5G deployments with leading communications service providers by 2019, and significant volumes in 2021. In Sub-Saharan Africa, 5G subscriptions in discernible volumes are expected from 2022.

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    9 Grey Swans for 2019

    Thanks to a subscriber for this report from Nomura which may be of interest to subscribers. Here is a section:

    Indian Stock Market Leapfrogs Germany's as Economy Booms

    This article by Srinivasan Sivabalan for Bloomberg may be of interest to subscribers. Here is a section:

    India’s ascent on the global stage has claimed another victory after its stock market overtook Germany to become the seventh largest in the world.

    The Asian giant edged past the equity market of Europe’s largest economy for the first time in seven years, according to data compiled by Bloomberg. That means, after the U.K. leaves the European Union in March, the bloc would have only one country -- France -- among the seven biggest markets.

    The move reflects India’s positive returns this year as companies’ reliance on domestic demand enabled them to avoid the meltdown in other emerging markets spurred by Federal Reserve tightening and a trade war between the U.S. and China. It also highlights the challenges facing the EU, including its future relationship with the U.K., a standoff with Italy over budget allocations and separatist clashes in Spain.
     

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    Top India Official Who Oversaw Cash Ban Is New RBI Chief

    This article by Siddhartha Singh and Anirban Nag for Bloomberg may be of interest to subscribers. Here is a section:

    India named a former bureaucrat who oversaw Prime Minister Narendra Modi’s controversial cash ban program as its new central bank chief, a day after Urjit Patel abruptly quit following disagreements with the government.

    Shaktikanta Das, 63, who often sought a cut in interest rates during his time at the Finance Ministry, was appointed for a three-year tenure, according to a statement on Tuesday from the Personnel Ministry. He will be the 25th governor of the 83-year-old monetary authority.

    And

    Das will take charge of the six-member monetary policy committee, which left interest rates unchanged last week after two hikes earlier this year. With inflation undershooting the central bank’s forecasts, there are growing expectations that the RBI will shift to a neutral policy stance from its current tightening bias, which could set the stage for a rate cut.

    “There was a disconnect between the government and the central bank and the market now expects a less hawkish stance under the new regime,” said Aashish Sommaiyaa, chief executive officer at Motilal Oswal Asset Management Co. in Mumbai.

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    India Seeks to Ease Biggest Hurdle for Factories With New Policy

    This article by Archana Chaudhary for Bloomberg may be of interest to subscribers. Here is a section:

    Under the new plan, a company need not purchase land or equipment but could lease them on long-contract basis helping lower costs and cut down time on setting up operations, secretary to the Department of Industrial Policy and Promotion Ramesh Abhishek said in an interview. Units located in
    industrial clusters may be able to share infrastructure.

    “We have to be competitive,” said Abhishek, who’s ministry has been working on the plan for over a year. “For this we need to upgrade our technology, lower costs, improve logistics, skill our labor. The industrial policy will bring all things together and will come out with recommendations on what needs to be done.”

    Prime Minister Modi’s administration has been struggling to fulfill one of his key campaign pledge -- creating 10 million jobs a year-- that propelled him to power in 2014 elections. As the country heads to poll due early 2019, the main opposition Congress party is moving to cash in on the disenchantment over unemployment and rising social tensions.

    The reform measure, likely to be one of the last few before the Modi seeks re-election, attempts to attract over $100 billion in investments into the country and kick start the economy. Quarterly growth is expected to have slowed in the three months ended September even as a liquidity crunch at its banks hurts business sentiment before state elections.

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    Japan's Inflation Stalls at 1% as Risks to Price Gains Gather

    This article by Yuko Takeo for Bloomberg may be of interest to subscribers. Here is a section: 

    Slow but steady improvement in Japan’s core inflation gauge has come to a halt as a host of forces gather that could see price gains begin to slow.

    Consumer prices excluding fresh food rose 1 percent in October from a year earlier, as expected by economists. That’s just half way to the Bank of Japan’s 2 percent target with the prospect of falling energy costs and lower charges from mobile-phone carriers pointing to weaker price growth ahead.

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    India Capital Fund Letter

    Thanks to a subscriber for this report from which includes a great deal of data which may be of interest. Here is a section:

    India and Its Central Bank Signal Truce After Marathon Meet

    This article by Shruti Srivastava and Anirban Nag for Bloomberg may be of interest to subscribers. Here is a section:
     

    India’s central bank signaled a compromise with the government by agreeing to study a demand for sharing a part of its capital -- an issue that had triggered a public spat between the monetary policy makers and their political bosses.

    The Reserve Bank of India will form a panel to consider the funds transfer to the government, the central bank said in a statement after the board meeting that lasted a little over nine hours. It, however, did not immediately yield to demands for easing lending norms for weak banks while retaining capital buffers for banks at 9 percent.

    “Both the RBI governor and the finance ministry walked the extra mile,” Sachin Chaturvedi, a member of the board said in an interview to Bloomberg. “They were flexible on several issues.”

    The government and the RBI have been sparring over how much capital the central bank needs and how tough its lending rules should be. For a nation that relies on imported capital to fund investment, the reaching of a middle ground is key to retaining investor confidence in the world’s fastest-growing major economy.

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    Volvo Cars Rips Up Production Plans, Citing U.S.-China Trade War

    This article by Keith Naughton and Gabrielle Coppola for Bloomberg may be of interest to subscribers.

    Volvo Cars is shaking up production plans for much of its lineup in an effort to dodge tariffs the U.S. and China have slapped on auto imports.

    The Swedish automaker owned by China’s Zhejiang Geely Holding Group Co.has canceled plans to export S60 sedans from its first U.S. plant to China, just months after starting production. Volvo also will stop importing XC60 sport utility vehicles and dramatically reduce shipments of S90 sedans from China to the U.S.

    Volvo will pivot to mostly exporting S60s from its factory near Charleston, South Carolina, to focus mostly on supplying the American market, according to Anders Gustafsson, the president of the carmaker’s U.S. unit.

    “We’ll go at this change not with a smile, but we know what we need to do,” Gustafsson said. “We have a global manufacturing structure that helps us maneuver in these tough waters.”

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