Monday, July 1, 2013

Government to borrow 1.56 lakh cr

The govt will borrow Rs 1.56 lakh crore in the July-September quarter to meet its financing requirements, which is in line with the schedule spelled out by the Finance Ministry at the beginning of the year.

As per the borrowing calendar issued by the Finance Ministry in consultation with the Reserve Bank, the government will auction Treasury Bills worth Rs 1.56 lakh crore in the September quarter.

The gross market borrowing through issue of dated securities in 2013-14 has been pegged at Rs 5.79 lakh crore. Of this, 58 percent would be completed in the first half.

The front-loading of borrowing is aimed at making available capital to the private sector in the last six months of 2013-14, experts said.

The government has to borrow funds from the market to finance the fiscal deficit, which is estimated to be 4.8 percent in current fiscal. In 2012-13, the fiscal deficit was 4.9 percent.

The government is hoping to garner Rs 40,000 crore from disinvestment, Rs 15,000 crore from residual stake sale in companies and healthy growth in tax collection to fund its expenditure in 2013-14.

Finance Minister P Chidambaram has already indicated that he will stick to the fiscal deficit target of 4.8 percent of GDP for this year.

However, according to experts rupee depreciation would put pressure on the fiscal deficit as the oil and fertiliser subsidy bills are likely to shoot up.

The net borrowing for 2013-14 fiscal year will be at Rs 4.84 lakh crore. During 2012-13, the government borrowed a net Rs 4.67 lakh crore from the marke

Croatia becomes 28th EU Member

Croatia became the 28th EU member, the bloc’s first addition since Bulgaria and Romania joined in 2007.
Though enthusiasm for the country’s achievement has been dampened by the EU’s financial turmoil, it is a historic turning point for the small Balkan nation of 4.2 million, which endured years of carnage after declaring independence from the former Yugoslavia in 1991.
“As midnight struck, your country crossed an important threshold,” European Council President Herman Van Rompuy told the cheering crowd in Croatia’s capital Zagreb. “It will change the life of this nation for good.”
“In the history of a nation, there are a few events such as this one,” Croatia’s President Ivo Josipovic said. “The accession of Croatia to the European Union is confirmation that each one of us belongs to the European democratic and cultural set of values.”
A decade back, when Croatia started negotiating the entry, the once war-torn country was overjoyed at the prospect of becoming a member of the European elite. With the EU in deep financial trouble and Croatia’s own economy in recession for five consecutive years, the excitement has dimmed.
Thousands of people waving small EU and Croatian flags nonetheless joined celebrations across the country, including in Zagreb’s main square. There, artists performed for some 100 visiting foreign leaders until midnight when big fireworks and the singing of Beethoven’s Ode to Joy, EU’s anthem, marked the official entry into the bloc.
Customs posts were removed from Croatia’s borders with EU neighbours Slovenia and Hungary, while EU signs and flags were put on its borders with non-EU states Bosnia, Serbia and Montenegro. The festivities were much more modest and less jubilant than when Bulgaria and Romania, currently EU’s poorest states, became members.
With the entry, Croatia becomes the third poorest country in the EU. “There are not too many festivities because the general situation is not brilliant,” Josipovic said in a recent interview. “We have to develop our economy, take care of those people who are jobless now, and there is no time and money for big celebrations.”
However, with an unemployment rate hovering at around 20 percent, plunging living standards, alleged corruption among its political elite, many Croats are not in the mood to celebrate.
Croatia will be officially recognized as a European Union member at midnight on Sunday, becoming the 28th state to join the bloc. Over 170 foreign officials, including 15 heads of state and 13 prime ministers, are expected to attend the grand ceremony in the capital, Zagreb. European Commission President Jose Manuel Barroso and European Council President Herman Van Rompuy are expected to be among the speakers at the event. “We also believe that the EU has a future,” Ivo Josipovic, Croatia’s president, told local Nova TV. But the mood is far from festive among Croatian populace as the country endures its fifth year of recession and record unemployment of 21 percent. Many believe the former Yugoslav state will become a burden to the EU, which has economic problems of its own, and repeat the sad fate of the bloc’s southern members Greece, Portugal and Spain.

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