The speculation of a better performance by the economy in the last quarter of the fiscal year has led Assocham, which is an industrial body, to predict 7.4% growth in the economy. This estimate is a little higher than the rate estimated by the government.

According to the expectations of Assocham, the economy should grow by 8% from January to March in this fiscal year. This expectation is a result of recovery in the exports industry, good economic activities in the manufacturing sector, and intensified measures by domestic industry to utilize its capacity.

Mr. Swati Piramal, the President of Chamber, said, “…the current fiscal will end up with a GDP growth figure of 7.2 per cent to 7.4 per cent.”  From October to December 2009, country’s GDP had dropped to 6% due to fall in the out of agriculture sector. This was a total drop of 1%, since the economy had grew by 7% in the first six months of the fiscal year.

According to the calculations of Central Statistical Organisation, Indian economy will rise by 7.2% in the year 2009-2010. Indian Economy is showing diminishing trends in growth since last fiscal year when it grew by just 6.7%.

It was a result of global recession, since before that Indian economy grew by more than 9% for 3 consecutive years.
According to Assocham, engineering, automobile, heavy engineering, telecom and services are the sectors which are likely to make the most impact on the economic growth. Exports sector is also expected to perform much better in the last quarter of the fiscal year, after getting affected by the global slowdown.

Piramal added that there are indications of better capacity utilization by the domestic industry. She said, “This will further accelerate to provide enough boost for better GDP growth.”

A rise in the value of rupee should have ideally raised the morale of the economy even further. However, even as investors cheer, all is not well for the export sector. The exporters are not raising hue and cry for the government to step in and put an end to these rather large fluctuations once and for all.

The Chinese government has already taken notice of the falling dollar values against the rising Chinese currencies. They have pegged in a fixed exchange rate to protect the interests of the local exporters. Indian exporters are waiting for their government to make a similar move.

Since the last one year, the US dollar has been declining continuously at an average rate of 12 per cent. One of the huge inflows of the FIIs. The FIIs in turn bet high on the Indian growth story, making the position of the Indian rupee far stronger than that of the American dollar.

Today, exporters were especially taken aback when the US dollar fell to a nineteen month low of Rs. 45. This can severely affect the exporters who will now realize lower profit margins because of the decreased value of dollars when it is converted into the local currency.

The World Gold Council (WGC) speculates that in the next ten years the demand for precious metals like gold will double in China. This will make it the second highest gold consumer in the world. India is currently the biggest consumer of gold in the world.

The demand for gold among buyers is increasing rapidly in China despite the rising gold prices. The demand is likely to rise in future also, according to the report released by London-based organisation World Gold Council on Monday. It was organisation’s first report on the gold market in China. The report, which was titled as “Gold in the Year of the Tiger” said that in the last 5 years, gold demand in China has risen at a rate of 13% per annum in China. In 2007, the country was the biggest gold producer in the world.

Last year, 462 tonnes of gold was consumed in China. The total value of the gold consumed in China was $14 billion which was 11% of demand of gold globally. The report has predicted that in the next decade, this demand will increase two folds.

Albert Cheng who is the managing director for Far East office of WGC stated that the growth in gold consumption has come from various sectors like private investment, central and industrial banks, apart from jewellery industry. People’s Bank of China is holding around 1.6 percent of entire gold reserves in China. This ratio is pretty low by international standards.

Interestingly, China is the biggest US treasury bonds holder in the world. With the rising volatility in the rates of US dollar, China may start using gold as its alternative choice of investment, the report stated. It said, “With total reserves of $2.4 trillion, China still has the ‘fire power’ left in its books should the country decide to increase its gold allocation.”

But, vice governor of central bank of China, Yi Gang has recently said that China would never consider gold as a prominent investment channel for foreign reserves.

Bharti Airtel, which is India’s leading telecom company, will be launching its 3G service by the end of 2010.
Sanjay Kapoor who is the CEO (India and South Asia) of Bharti said “Our core network is 3G ready, billing, application and content ready. Once bids are through, services will take six to eight months after that.” He was talking at the launch function of a HTC cellphone which works exclusively on Airtel.

The 3G services will make high speed broadband and data download at affordable prices. The telecom providers are scheduled to bid for the 3G spectrum on 9th of April this year, but according to the guidelines given by Department of Telecom (DoT) guidelines, providers will only be allowed to start providing 3G services on commercial basis after September 1, 2010. Therefore, Bharti will be able to start its services by October.

Airtel has also put their bids for BWA spectrum, besides 3G. Almost all other telecom providers in India like Vodafone, Idea Cellular, RCom, Tatas etc. have also bid for 3G and BWA (Broadband Wireless Access) spectrum along with Bharti. But Videocon and Etisalat have only placed their bids for 3G while Spice, Qualcomm, HFCL and Tikona have only bid for BWA spectrum.

The reserve price for all India 3G spectrum is fixed at Rs. 3500 crore and Rs. 1750 crore for BWA services by the government authorities.  The government has fixed Rs. 3,500 crore as reserve price for pan-India 3G spectrum and Rs 1,750 crore for Broadband Wireless Access (BWA) services.

But the bid price are expected to rise since the number of aspiring operators is far more than the number of slots available in 3G and BWA service. The government plans to sell the spectrum to just 3 companies in the country with rare exception of adding a fourth player in some states. Airtel has more than 12 crore subscribers nationwide and is already releasing handsets which are ready for 3G technology. The company has recently cracked a deal to sell 3G enabled iPhones in India with Apple. Airtel has also launched another smartphone with HTC which will cost Rs.9990.