New Delhi, June 20
The World Bank has projected that India will grow at 5.5% this year and accelerate to 6.3% next year breaking two years of sub-5% growth on the back of rebound in domestic investments and pick up in manufacturing activity.

Onno Ruhl, World Bank's Country Director-India, said removing bottlenecks in energy supply, improving the business climate and unlocking stalled PPP contracts are some of the key areas that could be addressed in the short term to bring India back to a high growth trajectory.

“In addition to making more effective use of resources spent on subsidies for fuel, food and fertiliser, India needs to boost revenue generation,” said Ruhl. Implementing the Goods and Services Tax (GST), targeting subsidies better and broadening the tax base will help create the fiscal space for supporting accelerated growth and poverty reduction.

He was speaking at a function here to release the World Bank's report on Global Economic Prospects (GEP) 2014. Overall, the global economy is expected to pick up speed as the year progresses and is projected to expand by 2.8% this year, strengthening to 3.4 and 3.5% in 2015 and 2016, respectively. High-income economies will contribute to about half of global growth in 2015 and 2016, compared with less than 40% in 2013.

The GEP 2014 report also points out the need for continued progress on fiscal consolidation to ensure fiscal sustainability and to create space for pro-poor expenditure. India’s general government deficit, despite falling, is still more than 2 percentage points of GDP higher than in 2007, indicating that depleted fiscal buffers have yet to be fully restored.

The report highlighted that a key risk to the near-term outlook is weak seasonal monsoon rains, perhaps triggered by El Nino weather conditions. Weaker than average monsoon can reduce GDP growth in South Asia by half a percentage point or more, while stronger El Nino conditions that result in deficient rainfalls or drought can have more significant impacts, the report cautions.

Stressed bank loans (including restructured loans), which now exceed 10% of loans in India, represent another source of vulnerability. If left unaddressed, it could result in insufficient financing for resumption of the investment cycle in India, the report warns.

New Delhi, June 20
Power Minister Piyush Goyal today asked Coal India to ramp up production from existing mines, increase supplies to utilities by reducing the quantity offered in e-auctions and address the issue of fuel quality.

"We need to enhance the supply of coal. We have requested the Ministry of Environment and Forests to allow additional mining from coal mines which are already operational. Reduction in quantity of coal at the time of e-auction will enable additional supplies to power sector," Goyal said.

Goyal met top private power honchos, including Anil Ambani, chairman of Reliance Power, Gautam Adani, chairman of Adani Group, Vineet Mittal, managing director of Welspun Energy, and Naveen Jindal, chairman of Jindal Power, to look for solutions to address the country's electricity shortage, which was as much as 7,000 MW in May.

"We have asked Coal India to expand coal production to the tune of 50-60% for all power companies in the state sector or private sector. We need to enhance power availability in the country," he said. — PTI

New Delhi, June 20
Estimating that about $2 trillion of black money from India is stashed overseas, industry body Assocham has suggested that the government should come out with a six-month amnesty scheme that will facilitate transfer of such funds back home on voluntary basis with payment of 40% tax.

The chamber has submitted these recommendations to the government and the Special Investigation Team (SIT) constituted on black money.

The paper on black money says that the amnesty scheme limited to six months suggests a 40% tax on voluntarily disclosed funds topped with a 10% investment of the total money brought back in infrastructure bonds.

The 40% tax deduction is 10% above the maximum effective tax on income and would dissuade misuse of the scheme for turning internal black money into white through a transfer mechanism.

According to the paper, the government should not use the revenue for bridging its budget deficit but channel it to specific projects of larger benefit, including infrastructure development.

There is also a need to introduce uniform stamp duty rate applicable across the country. Assocham has said a stamp duty rate of 3% is fair and reasonable rate.

To further reduce the temptation for underreporting of purchase price paid, the chamber has asked for the circle rate to be notified every year on the basis of the data input for the preceding year so as to make sure that the circle rates are as good as the prevalent market rate.

According to various studies, Assocham said Indian wealth held abroad illegally varied from Rs 600 crore in 1953-54 (or 0.6% of the then GDP) to Rs 60,000 crore per year.

New Delhi, June 20
Gold prices today surged by Rs 605 to hit a one-month high of Rs 28,625 per 10 gram in the national capital, recording the biggest single-day gain this year, after the precious metal posted its steepest rise in nine months in the global markets.

Silver also spurted by Rs 1,800 to Rs 44,900 per kg on increased offtake by industrial units and coin makers.

Sentiment bolstered after gold rose the most since September 2013 in global markets as the dollar weakened, amidst expectations that borrowing costs in the US will remain low.

The worsening crisis in Iraq also fuelled demand for bullion as an alternative investment.

Gold in global markets, which normally sets price trend on the domestic front, climbed to $1,322.12 an ounce in Singapore, the highest level since April 12. — PTI

Mumbai, June 20
To enhance the depth of the foreign exchange market, the RBI today allowed foreign portfolio investors to participate in the domestic exchange-traded currency derivatives.

At the same time, domestic players like exporters and importers would now require underlying exposure if they position beyond $10 million.

Such foreign investors can participate in the currency futures or exchange traded options market. — PTI

London, June 20
India became home to 1.56 lakh millionaires with 3,000 more joining the elite club in 2013, making the country 16th most populous in terms of population of super-rich people worldwide, says a report.

According to the World Wealth Report 2014, released by Capgemini and RBC Wealth Management, there were 1,56,000 high net worth individuals in India in 2013, while in 2012 the figure stood at 1,53,000.

India has been ranked 16th in the list of countries with highest number of HNWI population, the US topping the chart with 40,06,000 millionaires, followed by Japan (23,27,000), Germany (11,30,000) and China (7,58,000) in the second, third and fourth position, respectively.

The top four countries account for more than half (59.9%) of the total worldwide HNWI population.

The world is home to 1.76 million millionaires with a collective net worth of $52.62 trillion, registering a 15% increase in HNWI population over last year. — PTI

BRIEFLY

Forex reserves up $950m to $313.54 billion
Mumbai: India's forex reserves rose by $950.9 million to $313.536 billion in the week to June 13, on account of gains in currency assets. In the previous week, total reserves gained by $203.2 million to $312.585 billion. — PTI

BoI seeks Rs2,000 cr fund infusion from govt
New Delhi: The Bank of India on Friday said it has requested Rs 2,000 crore fund infusion from the government to meet capital requirement for the current fiscal. BoI CMD VR Iyer said the bank’s overall requirement for the current year was around Rs 4,500 crore and they were looking at tier-I bond, which is Basel III compliant and then the government would also come in. — PTI

OVL signs pact with Turkish oil company
New Delhi: ONGC Videsh Ltd (OVL) has inked an agreement with Turkish petroleum firm TPAO for jointly bidding for oil assets in other countries. OVL managing director SP Garg and Turkish Petroleum Crop CEO Besim Sisman signed the MoU on the sidelines of World Petroleum Congress in Moscow. — PTI

BlackBerry offers Rs5,000 discount on Z30 model
New Delhi: BlackBerry has offered consumers a discount of Rs 5,000 on its BB10-powered 'Z30' in exchange for their old smartphones. Starting Friday, customers can now upgrade to Z30 for Rs 29,990. — PTI

Potato futures hit lower circuit, plunge 4%
New Delhi: Potato prices fell by 4% to hit lower circuit at Rs 1,220.70 per quintal in futures trade on Friday on offloading of positions by nervous speculators after commodity markets regulator FMC imposed restrictions in order to check rising prices in physical markets. — PTI