Drought
hampers India's economic growth
A severe drought has hampered India's
attempts to return to strong economic growth but an industrial
rebound is cushioning the country from shocks such as the Iraq
crisis, the government's annual economic survey said February
27, 2003.
The finance ministry survey said
the failure of the monsoon rains had also increased pressure on
the high government budget deficit.
The effect of the drought on agriculture
"clouds an across the-board improvement in the growth performance
of industry and services", the survey said. Seventeen of India's
29 states experienced a drought last June and July, including
the country's breadbasket northern states.
The survey said despite economic
growth of 6.0 percent and 5.8 percent in the first two quarters
of the financial year to March from a year earlier, the growth
rate for the full year is forecast at 4.4 percent, down from 5.6
percent in the previous year.
Chambers
Worried Over Rising Budget Deficit of India
Welcoming the positive industry
outlook in the Economic Survey, apex industry bodies Confederation
of Indian Industry (CII) and Federation of Indian Chambers of
Commerce and Industry (FICCI) expressed concerns over the rising
Budget deficit.
FICCI said the Survey has laid out
a clear roadmap for achieving a growth target of 8 percent for
the 10th Plan period. "It has highly identified technology, competition
and benchmarking to be the best international practices as the
three drivers for rapid growth," said FICCI president AC Muthiah,
adding that, "this had lifted India's consumer goods, automobiles
and telecom sectors to higher growth trajectory with better quality
to customers, and the same now needs to be extended to agriculture."
CII president Ashok Soota said the
Survey had highlighted a positive outlook for the industry, but
that the burgeoning Centre-state deficit was a key area of concern.
Mr. Soota highlighted other areas
of concern such as public finance and the govt's management of
the food economy. However, CII has declared that the industry
is in agreement with Survey's assessments.
Bangladesh
to decide on gas exports
Bangladesh will decide 'soon' whether
to export natural gas to India, the government said, after six
years of weighing the prospect of big earnings against worries
about depleting limited reserves.
Foreign oil companies prospecting
in Bangladesh have been pressing since 1996 for approval to export
natural gas by pipeline to neighbouring India, saying the impoverished
South Asian country could earn $ 500 million a year.
Authorities have been deferring a
decision amid concern that such exports could deplete the nation's
reserves and leave in unable to meet its domestic needs.
The US-based gas firm Unocal Corp
has proposed building a 1,360 kilometer pipeline from northeast
Bangladesh across to border into India.
Bangladesh
introduces travel tax
Foreigners traveling out of Bangladesh
will be charged a travel tax of up to $43 depending on their destination.
Previously only Bangladeshis traveling abroad had to pay the tax.
The charge will be 800 taka ($13.79) for travel from Bangladesh
to other South Asian countries, 1,800 taka ($31) for the Middle
East and $43 for the rest of the world. The tax will be collected
at airports, seaports or land crossings. It will not be charged
to children, cancer patients or people with disabilities, or to
diplomats and airline crews.
Pakistan
encourage foreign investment
Pakistan's new privatization chief
has a daunting task trying to encourage foreign investment at
a time when violence against Westerners is on the rise and fear
has kept many away.
The task is an important one, Hafeez
Sheikh said in a interview. While Pakistan's economy has galloped
in the past three years, overseas investment has dwindled and
sales of state owned assets to foreign investors has been slow.
Prime Minister Zafarullah Khan Jamali's
government wants privatization to help raise as much as US$2.5
billion for state coffers a task left over by the military regime
of President Gen. Pervez Musharraf, which managed to raise only
US$600 million in the last three years.
The government has set a goal of
US$1 billion in foreign investment this year, a mark reached only
once before.
Sri
Lanka needs international help
The Asian Development Bank recently
urged the international community to help rebuild Sri Lanka, even
before the country reaches a final settlement to end its civil
war.
ADB President Tadao Chino visited
Sri Lanka recently and traveled to the island's north, where he
discussed development projects with officials from the Tamil Tiger
rebels, who have been fighting a separatist war for nearly two
decades.
"We need to provide continued assistance
to sustain and enhance the peace process while waiting for a lasting
peace," Chino told reporters in the capital, Colombo.
The ADB provides US$200 million in
annual assistance to Sri Lanka and may increase that after a donor
conference in Tokyo in June.
