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Beware the Waking Dragon
New economic data casts dark clouds over economic revival
The Consumer Price Index increased from 7.46% in June to 7.96% in July, according to data released by the government on Tuesday. The CPI measures the change in market price levels for a representative basket of goods and services purchased by households. Meanwhile, overall factory output has decelerated by 1.8% in June to 3.4% due to a sharp decrease in the manufacturing activity.
Times of India: “The government on Friday approved a proposal to hike dearness allowance to 90% from existing 80%, a move that would benefit about 50 lakh central government employees and 30 lakh pensioners.
“The Union Cabinet approved the proposal to increase dearness allowance to 90% at its meeting. The hike would be effective from July 1, this year,” a source said.
According to the source, the increase in DA to 90% would result in additional annual expenditure of Rs 10,879 crore. There would be additional burden of Rs 6,297 crore on exchequer during 2013-14 on account of this hike in DA.
This is a double digit hike in DA after about three years. It was last in September, 2010, that the government had announced a hike of 10% to be given with effect from July 1, 2010.
DA was hiked to 80% from 72% in April, 2013, effective from January 1, this year.
As per the practice, the government uses CPI-IW data for past 12 months to arrive at a number for the purpose of any DA hike.
The retail inflation for industrial workers between July, 2012 and June 2013 was used to compute the increase in DA.”
continuously updated blog about China & India
continuously updated blog about China & India
continuously updated blog about China & India
CHINDIA ALERT: You'll be living in their world, very soon 