Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: articles on VAT and GST in India :: TAX RATES - GOODS TAXABLE @ 4% :: VAT RATES :: Central Excise rule to resale the machines to a new company :: VAT Audit :: list of goods taxed at 4% :: ACCOUNTING STANDARDS :: cpt :: due date for vat payment :: form 3cd :: TDS :: empanelment :: ARTICLES ON INPUT TAX CREDIT IN VAT :: ACCOUNTING STANDARD :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes
 
 
General »
 Shah gets notices over civic tax dues
 Tax revenue down in first six months after prohibition
 Post demonetisation, Income Tax department sends 30 cases of irregularities to Enforcement Directorate, CBI
 Don’t rush into a new tax without being prepared
 Can’t tax income from palace rent: Supreme Court
  Withdrawal of Legal Tender Character of the existing Bank Notes in the denominations of ₹ 500/- and ₹ 1000/- (Updated as on November 30, 2016)
 Cases for tax scrutiny will be selected by machines
 Time to revisit 1997 direct tax rates, says P Chidambaram
 Lok Sabha passes Bill to tax black money deposits post demonetisation
 Last day to pay property tax with old notes
 Income tax department asks IDS declarants to pay tax by 30 November

Studies: Global economy faces higher capital costs
December, 10th 2010

A new investment boom in emerging markets such as India and China coupled with a decline in saving rate in China is set to end the low interest rate environment in the coming years, McKinsey Global Institute has cautioned. In its latest report Farewell to cheap capital? The implications of long-term shifts in global investment and saving the global consulting firm has said that nominal and real interest rates that are currently at 30-year lows are likely to rise in coming years.

If real long-term interest rates were to return to their 40-year average, they would rise by about 150 basis points from the level seen in the fall of 2010. And they may start moving up within five years, the report said.

The rise in interest rates, translating into higher cost of capital for businesses, investors and governments, would however be slower if the saving rate were to keep pace with the rise in demand for capital. That seems unlikely even though households in the US and UK have started saving a lot more in the aftermath of the financial crisis.

However, the increase in global saving rate is unlikely to match the rise in demand for capital when the Chinese government is encouraging its citizens to increase their consumption. The country needs to bring down its saving rate from 53% of GDP (in 2008) to sustain its high growth rate. If the Chinese governments policies indeed succeed, global saving would decline by at least 1.8 percentage points of the global GDP by 2030.

Increased saving by households in the US and UK, if it continues to persist, can at best offset this decline in global saving rate by just one percentage point in 2030. The global saving rate would also be depressed by the increased age-related spending in many countries. Spending for the retired could increase by 3-3.5% of the global GDP by 2030, according to some estimates.

The McKinsey report noted that developing economies are embarking on one of the biggest building booms in history. The world is now at the start of another potentially enormous wave of capital investment, this time driven primarily by emerging markets. By 2020, global investment demand could reach levels not seen since the postwar rebuilding of Europe and Japan and the era of high growth in mature economies, it said.

The investment boom is already being experienced across Asia, Latin America and Africa, where the demand for new homes, transport systems, factories, offices, skyscrapers, hospitals and shopping centers has already caused a jump in investment. The global investment rate had increased from a low of 20.8% of the GDP in 2002 to 23.7% in 2008, and then dipped again during the global recession of 2009.

The authors of the report noted that given the emerging nations led by China and India have low levels of capital, high investment rates are likely to continue for decades, exceeding 25% of global GDP by 2030. If consensus forecasts of global growth are realised, global investment will amount to $24 trillion in 2030, compared with $11 trillion currently (in constant 2005 prices and exchange rates).

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2016 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Software Reengineering Software Re-engineering Software Reverse Engineering Software Reverse Development Software Change Modulation Software Conversion Software Re-creation Software Re-development

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions