- February 2, 2022
- Posted by: Anish
- Category: Feed
Finance Minister of India Ms. Nirmala Sitharaman in the 2022-23 Union Budget lays down the foundation to steer the economic developments for India in the next 25 years with holistic and future priorities.
It stresses on big public investment for modern infrastructure, readying for India at 100. The finance minister stated that the outlay for capital expenditure in the Union Budget is once again being stepped up sharply by 35.4% in the current year to $100 Billion (Approx) in 2022-23.
The overall, sharp rebound and recovery of the economy is reflective of India’s strong resilience. India’s economic growth in the current year is estimated to be 9.2 per cent, the highest among all large economies.
India has become the third-largest start-up ecosystem in the world after the US and China. A record 44 Indian start-ups achieved unicorn status in 2021, taking the overall tally of start-up unicorns in India to 83, with most in the services sector. In 2021, the Indian start-up ecosystem raised $24.1 billion worth of equity investment of which 61% was raised by 42 companies that became unicorns, according to a report.
In Latin America (LatAm), growth is expected to average 6.2% for the region in 2021, with South America growing at 6.4%, Central America and Mexico at 6.0%. From the perspective of the Latin American and Caribbean countries, the region’s exports are estimated to have grown by 25% in value in 2021, with export prices rising by 17% and volume by 8%.
Meanwhile, imports are estimated to have grown by 32% in value, the largest increase since 2010, when they rose by the same amount in the aftermath of the global financial crisis. After collapsing in 2020, the volume of imports is estimated to have risen by 20%, in line with the expansion of both domestic consumption and domestic investment in the region, with import prices also rising, by 12%.
Commodity prices have continued the upward trend that began in May 2020; and, for the full year, they are projected to be 42% higher than their average level in 2020. They are still well above their pre-pandemic levels. In the case of copper, for example, since attaining historical highs of US$ 4.86 per pound, the daily price has remained above US$ 4 permanently. Energy prices have maintained the upward trend that began in May 2020, without interruption.
For 2021 as a whole, the price of agricultural products is expected to be 22% higher than their average level in 2020; the prices of metals and minerals are expected to be up by 37%; and energy prices are forecast to rise by 74%.
India, LatAm and the Supply Chain Opportunities:
The last two years of the pandemic have led to the great supply chain disruption in the world. From a shortage of semiconductor chips to the unavailability of containers, the trade and supply chain network has been in constant chaos. The world wants a globally distributed, resilient supply chain where no market is uniquely dependent on any other supply, or any singular location.
So, relocating or diversifying manufacturing sites, to other countries in the developing world is a good thing.
If you have countries putting in export restrictions and prohibitions, even one of those will prevent some inputs from moving from one part of the world to the other where they are needed, and that will disrupt supply chains. So, we need to pay attention to how the multilateral rules-based trading system is functioning. And yes, the monitoring function that we have, the transparency function we have, with members is crucial to making supply chains work.