NEWS FROM STATES
ECONOMIC SCENE


Forex reserves cross $ 35 bn mark 

The foreign exchange reserves have crossed the $ 35 billion mark. Forex reserves rose by $ 91 million to $ 35.072 billion on February 11 from $ 34.981 billion in the previous week, the weekly statistical supplement of the Reserve Bank of India said on February 19. 

$ 5 bn higher reserves to reduce current account gap 

The current account deficit on the balance of payments for 1999-2000 is expected to be less than 1.2 per cent of gross domestic product, against the level of 1.8 per cent projected in the Economic Survey. 

Disclosing this, senior Reserve Bank of India officials said foreign currency reserves have risen by $ 5 billion to $ 34.5 billion in the current fiscal year. This is higher than the $ 3.8 billion rise in 1998-99, though lower than the record $ 8.7 billion surge in 1993-94. 

The improvement in the current account is due to an unexpected surge in exports, a continued decline in non-oil imports and deceleration in gold imports. With the trade deficit being lower than anticipated and the inflow of invisibles estimated at around $ 9 billion, the current account deficit will be lower than expected. 

FDI approvals 

During the month of October 1999, 172 foreign collaboration proposals (including Technical Collaborations) were approved by the Government involving FDI amounting to Rs.1574.28 crore (US $ 0.37 billion). FDI inflows amounting to Rs.866.19 crore (US $ 0.21 billion) were received during this period. Cumulative FDI approvals for 1999 (January - October) was Rs.23,795.59 crore (US $ 5.67 billion) and the cumulative inflows for the same period add upto Rs.11,092.83 crore (US $ 2.64 billion). 

The total amount of Foreign Direct Investment (FDI) approved by the Government since 1991 is Rs.205,187.13 crore i.e. around (US $ 58.61 billion) and the total inflows add upto Rs.64,169.83 crore i.e. (US $ 17.82 billion). 

Railway Budget 2000-2001 

The Railway Budget for 2000-2001 was presented in Parliament on February 25 by the Railway Minister Kumari Mamta Banerjee. She did not propose any increase in passenger fares but suggested an average 5 per cent hike in freight rates to generate an additional revenue of Rs.600 crore. Her proposals envisaged high dependence on the general exchequer by proposing a 40 per cent higher budgetary support of Rs.3540 crore. This will help peg the plan outlay at Rs.11,000 crore, a 23 per cent increase over the revised outlay of Rs.8965 crore for 1999-2000. The balance amount (Rs.11000-3540) of Rs.7460 crore is proposed to be met by market borrowings (Rs.3668 crore) and internal and non-traditional sources like commercial utilisation of land and commercial publicity. The minister indicated an investment of Rs.825 crore on seven new and three ongoing projects for new lines. 

Freight target for 2000-20001 has been set at 475 million tonnes. Gross traffic receipts have been estimated at Rs.36,529 crore while the total working expenses at Rs.35,552 crore bearing net traffic receipts of Rs.977 crore. 

ADB assistance to boost Rajasthan tourism 

Tourism in Rajasthan will get a major boost with the Asian Development Bank (ADB) clearing a Rs.15.3 billion assistance project to improve urban infrastructure in popular tourist destinations in the State. These will cover water supply and sewage management systems in Jaipur, Ajmer, Bikaner, Jodhpur, Kota and Udaipur. The share of Jaipur alone will come to Rs.5.3 billion of the total ADB assistance, 30 per cent would come as a grant, and rest by way of a loan.