India has been struggling with slowing economic growth, high inflation levels and a weak currency. Above, a worker welds metal in New Delhi. Prashanth Vishwanathan / Bloomberg News
India has been struggling with slowing economic growth, high inflation levels and a weak currency. Above, a worker welds metal in New Delhi. Prashanth Vishwanathan / Bloomberg News

Indian manufacturing revives after four-month slump on new orders



MUMBAI // India's manufacturing activity returned to growth last month for the first time in four months, a further sign of economic improvement.

The data followed a positive surprise on Friday when the latest GDP reading showed a slight rebound.

The figures lifted the rupee to a two-week high yesterday, touching 61.96 against the US dollar after closing at 62.44 against the greenback on Sunday.

The benchmark S&P Bombay Stock Exchange Sensex rose 0.51 per cent yesterday to close at 20,898.01.

The HSBC purchasing managers’ index for India, compiled by Markit, climbed to 51.3 last month from 49.6 in October. A reading above 50 indicates expansion, while a reading below 50 shows contraction. This was the first reading above 50 since July, HSBC said, with manufacturing activity boosted by incoming new work.

“Manufacturing activity picked up, led by a rise in new domestic orders, which helped pull up output growth,” said Leif Eskesen, HSBC’s chief economist for India and Asean.

“Encouragingly, input and output price inflation eased, which, if sustained, could imply that the RBI [Reserve Bank of India] is getting closer to the end of its tightening cycle, although it may still need to notch [interest] rates up a bit further.”

India has been struggling with slowing economic growth, high inflation levels and a weak currency.

The Indian central bank raised interest rates in October for the second consecutive month to fight uncomfortably high inflation.

National GDP for the July to September quarter grew at a better than expected 4.8 per cent, official data released on Friday showed. That was an improvement from growth of 4.4 per cent in the previous quarter. India is believed to need economic growth of about 8 per cent to create jobs for its population and help lift millions of out of poverty. Its GDP growth slowed to a decade-low of 5 per cent in the last financial year.

Some economists say that the economic slowdown seems to be bottoming out, although they also say that a sustained recovery will be difficult over the coming months because of factors, including the general elections (which are expected by May), that are hampering investment.

Miguel Chanco, the India economist at Capital Economics, said: “Looking ahead, we believe that the economy’s road to recovery will be slow and bumpy. The main factor holding back the domestic economy is the poor investment environment. A whole host of investment projects are currently stalled because of bureaucratic issues.”

business@thenational.ae

How to protect yourself when air quality drops

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Close your windows and turn on the AC.

Shower or bath after being outside.

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Stay indoors when conditions are particularly poor.

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Name: Almnssa
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Investments: Grants/private funding

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

German intelligence warnings
  • 2002: "Hezbollah supporters feared becoming a target of security services because of the effects of [9/11] ... discussions on Hezbollah policy moved from mosques into smaller circles in private homes." Supporters in Germany: 800
  • 2013: "Financial and logistical support from Germany for Hezbollah in Lebanon supports the armed struggle against Israel ... Hezbollah supporters in Germany hold back from actions that would gain publicity." Supporters in Germany: 950
  • 2023: "It must be reckoned with that Hezbollah will continue to plan terrorist actions outside the Middle East against Israel or Israeli interests." Supporters in Germany: 1,250 

Source: Federal Office for the Protection of the Constitution

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TO A LAND UNKNOWN

Director: Mahdi Fleifel

Starring: Mahmoud Bakri, Aram Sabbah, Mohammad Alsurafa

Rating: 4.5/5

Other workplace saving schemes
  • The UAE government announced a retirement savings plan for private and free zone sector employees in 2023.
  • Dubai’s savings retirement scheme for foreign employees working in the emirate’s government and public sector came into effect in 2022.
  • National Bonds unveiled a Golden Pension Scheme in 2022 to help private-sector foreign employees with their financial planning.
  • In April 2021, Hayah Insurance unveiled a workplace savings plan to help UAE employees save for their retirement.
  • Lunate, an Abu Dhabi-based investment manager, has launched a fund that will allow UAE private companies to offer employees investment returns on end-of-service benefits.
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Stars: Nadine Labaki, Ziad Bakri, Zain Al Rafeea, Riman Al Rafeea

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Game Changer

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Stars: Ram Charan, Kiara Advani, Anjali, S J Suryah, Jayaram

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Frankenstein in Baghdad
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If you go
Where to stay: Courtyard by Marriott Titusville Kennedy Space Centre has unparalleled views of the Indian River. Alligators can be spotted from hotel room balconies, as can several rocket launch sites. The hotel also boasts cool space-themed decor.

When to go: Florida is best experienced during the winter months, from November to May, before the humidity kicks in.

How to get there: Emirates currently flies from Dubai to Orlando five times a week.

Electoral College Victory

Trump has so far secured 295 Electoral College votes, according to the Associated Press, exceeding the 270 needed to win. Only Nevada and Arizona remain to be called, and both swing states are leaning Republican. Trump swept all five remaining swing states, North Carolina, Georgia, Pennsylvania, Michigan and Wisconsin, sealing his path to victory and giving him a strong mandate. 

 

Popular Vote Tally

The count is ongoing, but Trump currently leads with nearly 51 per cent of the popular vote to Harris’s 47.6 per cent. Trump has over 72.2 million votes, while Harris trails with approximately 67.4 million.

UAE currency: the story behind the money in your pockets
Formula Middle East Calendar (Formula Regional and Formula 4)
Round 1: January 17-19, Yas Marina Circuit – Abu Dhabi
 
Round 2: January 22-23, Yas Marina Circuit – Abu Dhabi
 
Round 3: February 7-9, Dubai Autodrome – Dubai
 
Round 4: February 14-16, Yas Marina Circuit – Abu Dhabi
 
Round 5: February 25-27, Jeddah Corniche Circuit – Saudi Arabia
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