Bleak GDP growth projections for this financial year at 5 per cent or so will take away India's goal of becoming a $5 trillion economy by a few years. For, after a 5% expansion in FY20, the economy will need to grow the remaining four years at an impossible-looking 12% to be able to achieve that target. But, as Marico's Harsh Mariwala puts it, an aspirational goal can spur symptoms of increasing the growth rate at least closer to its potential. In that context, it should be okay even if we fall short of the goal by half a billion, or so.
STREET PULSE: Where we stand Asian stocks and Wall Street futures fell on Wednesday on growing worries US-China trade talks are stalling after President Trump failed to deliver any new information about when the two countries would sign the deal.
HERE'S WHAT TO WATCH  | SGX Nifty traded some 27 points lower at 7 am (IST), signalling possible weakness ahead on Dalal Street. MSCI index for Asia-Pacific shares outside Japan fell 0.2%. Australian shares were down 0.17%, while Japan's Nikkei slid 0.38%. |
| In overnight trade, Dow remained unchanged at 27,691.49, the S&P 500 gained 4.83 points, and the Nasdaq added 21.81 points. |
| Oil prices dipped on Wednesday as prospects for a trade deal dimmed. Brent futures edged down 16 cents to $61.90 a barrel, while WTI crude fell 15 cents to $56.65. |
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Telecom Relief... The Committee of Secretaries weighing possible relief to telecom firms on the adjusted gross revenue (AGR)-related dues is likely to recommend a reduction in the licence fee paid by telecom companies and allowing a two-year moratorium on spectrum payments, as part of measures to grant relief to the debt-laden sector, said three people familiar with the matter. One of the persons said the panel is set to suggest bringing down licence fee to 5% of adjusted gross revenue from 8%.
Read More IBC Formula... The government is considering a formula for distributing the proceeds of insolvency resolution among financial and operational creditors in a fixed proportion, said people with knowledge of the matter. The goal is to protect the interests of operational creditors and reduce delays due to litigation, ensuring that the objective of the Insolvency and Bankruptcy Code (IBC) is preserved.
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Slowdown Alarm... Two of India's leading banks see growth slowing to 5% in this financial year, following a sharper-than-expected contraction in industrial production in September and little evidence of a meaningful recovery. GDP grew 6.8% in FY19. Growth in the July-September period may have dropped to 4.2% from 5% in the first quarter, according to the estimates. An SBI report pegged full-year growth at 5%, down from 6.1% it had estimated earlier and expects "larger rate cuts" from RBI in December review. A Kotak Mahindra Bank note said it expected second-quarter growth at 4.7% and full-year growth at 5%.
Read More Trump Damper… US President Donald Trump on Tuesday disappointed investors, saying the US is close to signing an initial trade deal but gave no new details on when or where an agreement would be signed. In what was billed as a major speech on his administration's economic policies, Trump also rattled investors by threatening China with even more tariffs if they do not sign a deal. Expectations for a "phase one" trade deal some time this month have been a key factor supporting stocks and riskier assets recently.
Read More No NBFC Aid... The partial credit guarantee scheme launched three months ago by the Centre to increase the flow of funds to NBFCs remains a non-starter with risk-averse banks hesitating to take the lead and NBFCs unsure of who would bear the cost. Lack of clarity on whether to treat the transactions between the banks and NBFCs as 'securitisation' deals or as 'pass-through certificates' is also impeding any movement, given that these have accounting implications.
Read More Meanwhile... Vodafone said its future in India could be in doubt unless the government stopped hitting operators with higher taxes and charges, after a court judgment over licence fees resulted in a 1.9 billion euro group loss in its first half. Chief Executive Nick Read said India, where Vodafone formed a joint venture with Idea Cellular in 2018, had been "a very challenging situation for a long time". The telco had 300 million customers, equating to a 30% share of the sizable market.
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