IMF warns of 'Triad' of risks facing global economy

• Global growth moderate and uneven, forecast at 3.1 percent this year, 3.6 percent in 2016
• Disparate fortunes between the advanced and emerging market and developing economies
• Lower commodity prices weigh on commodity exporters

The IMF’s latest World Economic Outlook (WEO) foresees lower global growth compared to last year, with modest pickup in advanced economies and a slowing in emerging markets, primarily reflecting weakness in some large emerging economies and oil-exporting countries.

Recovery in advanced economies on course

Growth in advanced economies is projected to increase modestly to 2 percent this year and 2.2 percent next. This modest increase primarily due to declining oil prices, accommodative monetary policy, and improved financial conditions, and in some cases, currency depreciation.

Slower growth in emerging and developing economies

Growth prospects in emerging markets and developing economies vary across countries and regions. But the outlook in 2015 is generally weakening, with growth for these economies as a group projected to decline from 4.6 percent in 2014 to 4.0 percent in 2015.

Growth in low-income developing economies is expected to slow to 4.8 percent in 2015, from 6 percent in 2014,

Downside risks more significant

The WEO report outlines important shifts that could stall global recovery. These include:

• Lower oil and other commodity prices, which although benefiting commodity importers, complicate the outlook for commodity exporters, some of whom already face strained initial conditions (e.g., Russia, Venezuela, Nigeria).

• A sharper-than-expected slowdown in China  if the expected re balancing toward a more market-based and consumption-driven growth proves more challenging than expected.

• Disruptive asset price shifts and a further increase in financial market volatility could involve a reversal of capital flows in emerging market economies.

• A further appreciation of the U.S. dollar could pose balance sheet and funding risks for dollar debtors, especially in some emerging market economies,

• Increased geopolitical tensions in Ukraine, the Middle East, or parts of Africa could take a toll on confidence.

 

source : IMF website

India up 16 places to 55th on global competitiveness index

In a big jump, India has moved up  by 16 notch to rank 55th on a global index of the world’s most competitive economies. The jump in India’s position underlines the country’s recent economic recovery, improvement in institutions’ competitiveness, macroeconomic environment and a “slight improvement” in infrastructure, the World Economic Forum (WEF) said in its latest Global Competitiveness report.

Switzerland has retained its top position as the world’s most competitive economy for seventh year in a row and is followed by Singapore, the US, Germany and the Netherlands in the top-five.

Among emerging economies, India has ended five years of decline with a 16-place jump to 55th position. Turkey (51st), Brazil (75th) which posted one of the largest falls.

WEF said that the most problematic factors for doing business in India include corruption, policy instability, inflation and access to finance.

Here’s how India ranks across a range of areas

Parameter	Ranking
Market size	3
Innovation	42
Business sophistication	52
Financial market development	53
Institutions	60
Infrastructure	81
Health and primary education	84
Higher education and training	90
Macroeconomic environment	91
Goods market efficiency	91
Labour market efficiency	103
Technological readiness	120

Cipla to acquire US generic business

Cipla has acquired two US-based generic drug companies -- InvaGen Pharmaceuticals Inc., and Exelan Pharmaceuticals Inc for a total value of $550 M.

InvaGen & Exelan Pharmaceuticals    owned by the promoter of Hyderabad-based drug maker Hetero Drugs Ltd.  InvaGen acquisition  provides Cipla with an access to large wholesalers/retailers in the US. While, the acquisition of Exelan Pharmaceuticals provides Cipla access to the government and institutional market in the US . The combined revenue  of these  two companies  were approx  $200 M in 2014.  

InvaGen Pharmaceuticals is not linked directly to the flagship companies of Hetero group, Hetero  likely to  continue to strengthen its  US  presence  by investing  in  its subsidiary firm Camber Pharmaceuticals Inc.