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Originally posted by Fido

If you expect me to go to China ( because its a rising super power ) , you should be in the US first ( as it is a sustaining super power & you have been raving about it ) ...

Why are you not there ??? Be in the US first and then when you are up to your own standards , I will let you know why I m not in China .....

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Are you there?

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Originally posted by Fido

BTW .. congrats on the half century in a single thread as well as scoring > 3K posts ...

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Are you there?

Guys !
I think it is time that you two take your discussions offline or share each other's phone number and talk.
Let us leave the thread relavent to the thread topic.

Peace !

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I am a Gents and not a Ladies.

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Originally posted by tamilkuravan

Guys !
I think it is time that you two take your discussions offline or share each other's phone number and talk.
Let us leave the thread relavent to the thread topic.

Peace !

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Are you there?

Article:

http://timesofindia.indiatimes.com/business/india-business/Standard-Poors-warns-India-of-a-downgrade-to-junk-category/articleshow/14025360.cms


MUMBAI: International rating agency Standard & Poor's (S&P) has warned that India risks a sovereign downgrade which would result in the country dropping off the list of countries with an investment-grade rating.

The statement comes less then two months after the agency revised the outlook on India's rating to negative from stable and said that the country has a one-in-three chance of being downgraded in the next two years. India presently enjoys a BBB- which is the lowest investment grade rating.

Making a pointed observation on Prime Minister Manmohan Singh's government S&P said, "It would be ironic if a government under the economist who spurred much of the liberalization of India's economy and helped unleash such gains were to preside over their potential erosion"

The trigger for the recent report appears to be the sharp drop in India's quarterly GDP growth numbers and the drop in the value of the rupee.

"In our view, setbacks or reversals in India's path toward a more liberal economy could hurt its long-term growth prospects and, thus, its credit quality. How India's government reacts to potentially slower growth and greater vulnerability to economic shocks may determine, in large part, whether the country can maintain its investment-grade rating, or become the first "fallen angel" among the BRIC nations (which include Brazil, Russia, India, and China)," it said.

According to S&P, business confidence has been undermined by a perceived slowdown in government decision-making, failure to implement announced reforms, and growing bottlenecks in key sectors (including lack of reforms to archaic land acquisition laws that hinder investment). And, infrastructure problems, combined with growing shortfalls in the production of coal and other fuels, have dampened investment prospects.

"For example, various regulatory and other obstacles have delayed a proposed $12-billion investment in the steel sector by Korean steelmaker POSCO--potentially the biggest foreign investment project in Indian history--by more than seven years. Other steel projects have also faced extensive delays because of land acquisition hurdles and other issues" S&P said.

The rating agency is concerned about recent setbacks in economic policy which have hurt investor sentiment.

"Strong opposition from within the Congress party-led ruling coalition, as well as from opposition parties, recently forced the government to reverse its decision to raise the cap on foreign direct investment (FDI) in multibrand retail to 49% of total ownership from 26%. Similarly, pressure from a coalition ally of the governing Congress party caused the government to roll back a 10% hike in passenger train fares and forced the Railway Minister to quit. (Passenger fares have been flat for many years despite substantial growth in personal income and high inflation.)," S&P said.

The rating agency has said that in a pessimistic scenario there is a risk that political problems could prevent the government from containing the growth in current spending, and lower-than-projected GDP growth could result in revenue shortfalls.

Politically inspired spending programs could further widen the fiscal deficit. "Lack of progress in alleviating bottlenecks in key sectors of the economy could lower both domestic and foreign investment levels. Fiscal slippage, combined with persistently high inflation, could further weaken investor confidence. Both the government's debt burden and fiscal flexibility could continue to erode, in step with rising external vulnerability because of higher trade and current account deficits. India's credit quality would suffer under such a scenario, and a downgrade could result," the rating agency said.

Comments:

- My in-laws are seriously considering to put their industry on sale due to heavy inflation that transpires into heavy wages and labor problems, power problems, zero govt support but lot of corruption (percentage business in every project).

- the only sector that has growth is IT companies and BPO but the wind is not going blow the same directions as other competitors are picking up.

- I read yesterday where about a trillion rupees were with drawn from Indian Market in the last 3 months, it could be small but it could really be a starting point of pulling bricks from the building..

Please do not mix emotion with this, I will be equally going through a big compromise as like other investors, poor judgement.

Next stop, Canada.. which is going to see a huge economic problem in the near future due to the debts..

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The cowards never started,
The weak died on the way,
Only the strong arrived.
http://www.youtube.com/watch?v=_yK1i9cLAMM

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Originally posted by ashedfc

India has the ability to change its course: Imagine if today the retail FDI announcement is done, capital will fly back into Sensex.

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Originally posted by puttoo

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Originally posted by ashedfc

India has the ability to change its course: Imagine if today the retail FDI announcement is done, capital will fly back into Sensex.

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But what will happen to mom and pop stores .....

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