1. World Bank to launch ‘Business climate sturdy’ which will replace the discontinued Ease of Doing Business report
Tags: Economy/Finance International News
The World Bank has said that it will launch a new system for assessing the business and investment climate in economies worldwide following the discontinuation of the Ease of Doing Business report. The report titled Business Enabling Environment” (BEE) is expected to be launched in April 2024.
The Ease of Doing Business report which was first published by the World Bank in 2003 titled “Doing Business” report. The report ranked the country on their business friendly environment by about 12 indicators.
The report which was annually published by the World Bank was discontinued in September 2021 after a data rigging scandal came to light.
An internal audit of the World Bank revealed data irregularities in reports on China, Saudi Arabia, the United Arab Emirates and Azerbaijan in the 2018 and 2020 editions.
Subsequently, the Bank decided to come out with a new system that would be far more robust and credible than the earlier one. Hence it will come out with “Business Enabling Environment’.
India has performed very well on the Ease of Doing Business Index. It improved by 79 ranks to record 63rd positions in 2019 , according to the last Bank’s Doing Business report 2020.
Other Important World Bank reports
- World Development Report
- Global Economic Prospect
President of World Bank: David Malpass
2. Global Hunger Index 2022
Tags: Economics/Business International News
India ranked 107 out of 121 countries in the Global Hunger Index (GHI) 2022 that was released on 14 October 2022.
India's Performance
India is in a worse position than all the countries of South Asia except war-torn Afghanistan.
Hunger levels in India have been placed in the "severe" category with a score of 29.1.
Neighbouring Pakistan, Sri Lanka, Bangladesh, Nepal, and Myanmar have been ranked 99, 64, 84, 81, and 71 respectively – all countries above India.
The wasting rate (underweight by height) of children in India is 19.3%, worse than the levels recorded in 2014 (15.1%).
The prevalence of undernutrition in India has increased from 14.6% in 2018-2020 to 16.3% in 2019-2021.
It is estimated that 224.3 million people in India are malnourished, out of a total of 828 million people who are malnourished globally.
India has shown improvement in two indicators – child stunting has declined from 38.7% to 35.5% between 2014 and 2022, and child mortality has fallen from 4.6% to 3.3% in the same period.
In 2021, India ranked 101 out of 116 countries, while in 2020, India stood at 94th position.
Global Scenario
According to the index, there are 44 countries that currently have "severe" or "alarming" levels of hunger.
Globally, progress against hunger has largely stalled in recent years.
For the world a GHI score of 18.2 in 2022 is considered "moderate", but 18.2 in 2022 represents a slight improvement from 19.1 in 2014.
This is due to conflicts, climate change, the economic fallout of the COVID-19 pandemic as well as crises such as the Ukraine War, which have increased global food, fuel and fertilizer prices and are expected to worsen in 2023.
About Global Hunger Index
GHI is a tool for comprehensively measuring and tracking hunger across nations.
It is an annual report jointly published by Concern Worldwide and Welthungerhilfe.
It was first released in 2006, it is released every year in the month of October. Its 2022 edition refers to the 17th edition of the GHI.
It is calculated on the basis of four indicators –
Undernutrition - a population with insufficient caloric intake
Child wasting – Children under the age of five, who are underweight for their height, show acute malnutrition.
Child stunting - children under the age of five who are underweight for their age, indicating malnutrition
Child Mortality Rate - Mortality rate of children under five years of age
3. India set to become 3rd largest economy in the world by 2027-28: IMF
Tags: Economy/Finance
According to the World Economic Outlook Report 2022 released by the International Monetary Fund (IMF) on 11 October 2022, India is expected to become the third largest economy in 2027-28 by overtaking Japan. Earlier SBI in its report had predicted that India will become world's 3rd largest economy by 2028-29.
India still 6th largest economy in the world
However India is still the 6th largest economy in the world after the United Kingdom in 2021-22. The Indian Gross Domestic Product (GDP) 2021-22 was $ 3.18 trillion while the United Kingdom GDP was $ 3.19 trillion.
According to the IMF India will overtake the UK in 2022-23. India would become a $3.47-trillion economy in 2022-23, while the UK’s would be $3.2 trillion in the same period.
Earlier, a Bloomberg report stated that India has overtaken the UK in the fourth quarter of 2021-22, basing it on IMF data. However, that comparison was made on quarterly data and not on yearly data.
Future Projection of Indian Economy
According to IMF projections, the Indian Economy will be equal to the German economy in 2025-26 and will become the 4th largest in the world.
India’s economy will not be able to achieve the $5 trillion mark as hoped by the Finance Ministry by 2026-27 but it will be a $4.94 trillion economy.
In 2027-28 the India economy is expected to be at the $5.36-trillion mark, higher than Japan’s at $5.17 trillion. That year, India would become the third-largest economy.
According to the IMF, the United States was the largest economy in the world followed by China, Japan, Germany and the United Kingdom.
Managing Director of IMF: Kristalina Georgieva
IMF headquarters: Washington D.C, United States of America
4. IMF cuts India's growth rate to 6.8% for 2022 , India will still remain the fastest growing major economy in the world
Tags: Economy/Finance
The International Monetary Fund (IMF) in its annual World Economic Outlook released on 11 October 2022 has cut the expected growth rate of India to 6.8% in 2022, but still it will be the fastest growing major economy in the world. In July 2022, the IMF had said that India would grow at 7.4% in the present fiscal. IMF is the latest international agency which has cut the Indian growth rate. IMF expects the Indian economy to grow by 6.1% in 2023.
However, the IMF still expects the Indian economic growth to be highest amongst the major economies in the world ahead of China (4.4%), Saudi Arabia (3.7%), and Nigeria (3%).
World Economic Growth prospects
According to the IMF the world economy is likely to grow by 3.2 % in 2022 with the United State economy expected to grow by 1.6%.
The IMF said global GDP growth in 2023 will slow to 2.7%, as higher interest rates slow the U.S. economy, Europe struggles with spiking gas prices and China contends with continued COVID-19 lockdowns and a weakening property sector.
The three largest economies, the United States, China and the euro area will continue to stall," IMF chief economist Pierre-Olivier Gourinchas said in a statement. "In short, the worst is yet to come, and for many people, 2023 will feel like a recession."
IMF World Bank annual meeting 2022
The report was released on the eve of the Annual meeting of the IMF and World Bank which is going to be held in Washington D.C from 10 -16 October 2022.
This is the first in person meeting to be held after the three years due to covid related restriction.
Indian Finance Minister Nirmala Sitharaman is leading the Indian delegation to the meeting.
International Monetary Fund
- It is an International financial institution which was set up after the Bretton Woods conference held in the United States from July 1 to 22, 1944.
- It was set up in July 1944.
- It was set up to provide loans to the member countries which were facing a balance of payment crisis.
- A country which is a member of the IMF automatically becomes a member of the World Bank.
Total member of IMF: 189
Headquarters: Washington D. C, United States of America
Managing Director: Kristalina Georgieva
Accounting Unit of IMF: Special Drawing Rights (SDR)
5. The World Bank reduces India’s growth forecast to 6.5% in 2022-23
Tags: Economy/Finance
The World Bank in its latest report on South Asia released on 6 October 2022 has reduced the expected Indian economy growth rate in 2022-23 to 6.5% from an earlier estimate of 7.5% it forecasted in June 2022.
Growth estimates for the South Asian region - comprising India, Pakistan, Bangladesh, Sri Lanka, Nepal, Bhutan and the Maldives were revised down to 5.8% from 6.8% forecast in June 2022.
The bank cited the impact of war in Ukraine, which has caused a rise in commodity prices, and the uneven recovery from the impact of the COVID-19 pandemic in the region.
In a recent report the United Nations Conference on Trade and Development (UNCTAD) also revised the Indian economic growth in 2022 to 5.7%.
This is the third time the World Bank has revised its GDP growth forecast for India in 2022-23. In June, it had slashed its GDP growth forecast for India to 7.5%. Earlier in April, it had trimmed the forecast from 8.7% to 8%.
The Reserve Bank of India (RBI) has recently cut the economic growth projection for the current fiscal to 7% from 7.2% estimated earlier on account of extended geopolitical tensions and aggressive monetary policy tightening globally.
Important for Exam
World Bank headquarters: Washington D.C, United States of America
World Bank President: David Malpass
The report published by World Bank are
- World Development Report
- Global Economic Prospect
- Ease of Doing Business (it has been suspended now )
6. WTO reduces its forecast for world trade to 3 % in 2022
Tags: Economy/Finance
The World Trade Organization (WTO) in a press release released on 5 October 2022 has reduced its global trade growth forecast for 2022 to 3% from its earlier forecast of 3.5%. It said that high commodity prices and rising interest rates would curb import demand, and warned of a likely contraction in world trade if the conflict in Ukraine escalates.
The growth in world trade is expected to slow down to one per cent in 2023, due to global uncertainties.
Elaborating the area of concern for world trade WTO director-general Ngozi Okonjo-Iweala said in Geneva that “If the war in Ukraine worsens, rather than gets better, that’s going to have a huge impact,”.
Trade and economic output will be weighed down by several shocks, including the war in Ukraine, high energy prices, inflation, and monetary tightening,
WTO said that demand in Europe will decline and the cost of manufacturing will increase due to high energy prices stemming from the Russia-Ukraine war.
According to the WTO ,in the United States of America monetary policy tightening will hit interest-sensitive spending in areas such as housing, motor vehicles and fixed investment,” .
WTO expects the World GDP to grow by 2.8% in 2022 and by 2.3% in 2023 (revised down from 3.2%).
World Trade Organisation (WTO)
- It was set up on 1st January 1995 replacing the General Agreement on Tariff and Trade (GATT).
- Its main purpose is to promote rule based trading systems in the world and it also settles trade related disputes between the member countries.
- The headquarters of WTO is in Geneva, Switzerland.
- There are 164 member countries.
- Director General of WTO : Dr Ngozi -Okonjo-Iweala of Nigeria
- Report released by WTO : World Trade Report
7. India's economic growth to decline to 5.7% in 2022: UNCTAD
Tags: Economy/Finance
According to the United Nations Conference on Trade and Development (UNCTAD) Trade and Development Report 2022, the Indian economy growth rate is expected to decline to 5.7% in 2022(January-December period ). The report was released on 3 October 2022.
It also expects the Indian economy growth rate to reduce to 4.7 % in 2023.
The Indian economy grew by 8.7% in 2021-22. In the first quarter (April-June) of the current financial year (2022-23) it grew by 13.5%.
The Reserve Bank of India also reduced the expected growth rate of the Indian economy for 2022-23 to 7% in its latest monetary policy review on 30 September 2022.
The main reason cited by the UNCTAD report for reducing the economic growth rate of India is the expected reduction in the capital expenditure of the government due to adverse global economic situations.
UNCTAD said it expects the South Asia region to expand at a pace of 4.9 per cent in 2022
UNCTAD projects that the US economy will grow at 1.9 per cent in 2022 will further slow down to 0.9 per cent in 2023.
Meanwhile, China's economic growth is projected to be 3.9 per cent in 2022 and 5.3 per cent growth in 2023.
Forecast for Indian Economy Growth Rate by various agencies (till 3rd October 2022)
Agency /Institutions | Forecast for 2022-23 |
RBI | 7.0% |
World Bank | 7.5% |
International Monetary Fund | 7.4% |
Asian Development Bank | 7.2% |
SBI | 6.8% |
Moody Investor Service | 7.70% |
India Rating | 6.9% |
Standard and Poor Rating | 7.3% |
UNCTAD | 5.7 % |
OECD | 6.9% |
Fitch rating | 7% |
UNCTAD (United Nation Conference on Trade and Development)
UNCTAD is a permanent intergovernmental body established by the United Nations General Assembly in 1964.
It was set up to promote the interests of developing countries in world trade.
It also releases the World Investment Report.
Headquarters of UNCTAD: Geneva, Switzerland
Offices of UNCTAD: New York in the United States and Addis Ababa in Ethiopia.
Secretary-General: Mrs. Rebeca Grynspan of Costa Rica
8. Surging cost of inflation makes Global Recession most likely: World Economic Forum
Tags: Economy/Finance
In a report released on 28 September 2022, the World Economic Forum (WEF) said that due to persistently high inflation and fall in real wages continuing to fall, a global recession is becoming increasingly likely.
According to the WEF Chief Economists Outlook report, real wages are expected to continue falling across the world in 2022-2023 and the cost of living crisis is threatening social unrest, though inflationary pressures are expected to ease in the next year.
The survey of over 50 economists from the finance, insurance, professional services and technology industries, as well as international organizations and regional development banks, found that they expect reduced growth, stubbornly high inflation and continuing fall in real wages for the remainder of 2022 and 2023.
An average of seven out of ten economists consider a global recession to be at least "somewhat likely".
World Economic Forum (WEF)
The World Economic Forum was founded by German engineer, economist Professor Klaus Schwab as the European Management Forum, in Geneva, Switzerland.
In 1987 its name was changed to World Economic Forum.
The WEF engages the top political, business leaders of the world to influence and set the global, regional and Industry agenda.
It organises an annual meeting at Davos, Switzerland where world political and business leaders gathers to discuss international issues
It releases following reports;
Global Gender Report;
Chief Economist Outlook;
Global Risk Report;
Environmental Performance Report;
Global Competitive Index
Headquarters of WEF: Geneva, Switzerland
9. OECD expects India’s growth rate at 6.9% in 2022-23
Tags: Economy/Finance
Organisation for Economic Co-operation and Development (OECD) has retained its projection of 6.9% growth in India's GDP for the current financial year 2022-23.
OECD expects the Indian growth rate to be at 5.7% in the next fiscal year 2023-24.
The global rating agency Standard and Poor(S&P) has also maintained its forecast of a 7.3% growth rate of the Indian economy for the financial year 2022-23.
In its report titled Economic Outlook Asia-Pacific Q3 2022 report, has forecasted India’s growth rate to be 6.5% in 2023-24.
Earlier in a report released in September the Asian Development Bank had reduced the growth rate forecast for India to 7% for 2022-23.
RBI has forecasted a growth rate of 7.2% for the Indian economy in 2022-23.
The Indian economy grew by 8.7% in 2021-22 and in the first quarter of the current financial year (April-June 2022) it grew by 13.5%.
Organisation of Economic Cooperation and Development (OECD)
It was set upon 16 December 1960 by 18 European countries and the United States, Canada. It is a think tank which support free market economy.
The OECD publishes economic reports, statistical databases, analyses, and forecasts on the outlook for economic growth worldwide.
At present it has 38 member countries from Europe, South America, Asia and North America.
India, China are not members of OECD.
Headquarters: Paris, France.
10. India Discrimination Report 2022
Tags: National National News
Oxfam India recently released the 'India Discrimination Report 2022'. The report highlights that women and marginalized communities face discrimination in the job market.
IMPORTANT FACTS -
Key Highlights of the report :
Labour force participation rate (LFPR) :-
The labor force participation rate (LFPR) of women in India was just 25 per cent in 2021.
It is considerably lower than Brazil, Russia, China and South Africa.
Low participation was mainly due to gender discrimination in wages and opportunities.
Wage Gap :-
Self-employed urban men earn 2.5 times more than their female counterparts.
83 percent of this pay gap is attributable to gender-based discrimination.
In rural areas, the income gap between men and women is 93 percent due to gender discrimination.
Discrimination with Educational Qualification :-
The employment status of women does not depend on their educational qualifications.
Social Norms :-
A large section of qualified women is not available in the labor market due to family responsibilities.
Women from well-educated and economically well-off households often withdraw from the labor force due to socio-cultural reasons.
Women do not enter the labor market due to insecurities during travel and the need to go to office on time and due to family reasons.
Lack of salaried jobs :-
60 percent of urban men are engaged in salaried jobs or are self-employed, while among women this figure has come down to just 19 percent.
Status in SC, ST communities :-
SC and ST women start working at an early age without any formal education due to poor socio-economic conditions.
This means that more than educational qualification or age, social factors are the determinant factor for rural women to opt out or stay away from work.
Individuals belonging to SC and ST communities earn Rs 5,000 less than the national average.
Oxfam India :-
It is a organisation of people working to end discrimination and create a free and just society.
It is a part of the Oxfam Global Confederation in which 21 countries are working together as partners to build a better world.
