india 1 - 2 India Executive summary Highlights May 2008...

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2 India Monthly Report May 2008 www.eiu.com ' The Economist Intelligence Unit Limited 2008 Executive summary Highlights May 2008 Lacklustre state election results for the Indian National Congress party suggest that the United Progressive Alliance (UPA) minority coalition government that it leads is now likely to complete its full term ending in May 2009. The next general election will return another coalition government, since neither Congress nor the main opposition party, the Bharatiya Janata Party, is likely to be strong enough to win a majority on its own. The government’s target for the federal budget deficit in 2008/09 (April- March) is 2.5% of GDP, but its expansionary spending commitments and public-sector wage awards will keep the deficit at 3.2% of GDP. The acceleration in inflation will force the Reserve Bank of India (RBI, the central bank) to tighten monetary policy during 2008, with interest-rate cuts postponed to 2009.
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This note was uploaded on 05/12/2010 for the course COMMERCE finc at University of Sydney.

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india 1 - 2 India Executive summary Highlights May 2008...

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