Connect with us

Emerging Markets

Indian farmers mass outside New Delhi to protest at Modi’s agricultural reforms

Published

on


Thousands of Indian farmers massed on the outskirts of Delhi on Monday in a fifth day of protests against Prime Minister Narendra Modi’s agricultural reforms, which they say favour corporate interests.

Hundreds of police and paramilitary forces in riot gear were stationed at the state border to stop a convoy of tractors and trucks from descending on the country’s capital.

The farmers, from the grain-producing states of Punjab and Haryana, started their campaign in September after Mr Modi’s government pushed through three bills liberalising the agricultural sector, overriding demands from coalition partners and opposition parties for greater scrutiny of the legislation.

“When injustice becomes the law, protest becomes your duty,” said Naresh Sangnan, a 35-year-old farmer from Haryana, taking part in Monday’s demonstration. “All the farmers want the government to change.”

Police set up a roadblock to stop the farmers from marching to New Delhi
Police set up a roadblock to stop the farmers from marching to New Delhi © Sajjad Hussain/AFP/Getty

Under the new rules farmers can sell produce directly to private buyers instead of through government-controlled market yards. The reform’s proponents say it will make the market more efficient, but many farmers believe it will have a devastating impact on their already precarious livelihoods.

The farmers fear that the new rules mark the end of the minimum support price — which guarantees a fixed price for certain crops, mainly wheat and rice — and open the door for large corporations to set the prices. Mr Modi’s government has maintained that the minimum support price will stay intact, with public procurement to continue.

“The fear is that the bulk of buyers will shift to private markets, making the minimum support price system redundant and resulting in lower prices for the farmers,” said Himanshu, associate professor of economics at Jawaharlal Nehru University in New Delhi. “It’s creating a parallel market.”

The stakes for Mr Modi are high — the agricultural sector employs half of India’s workforce and rural distress has become a nationwide issue. In 2018, protesting farmers hung skulls around their necks to highlight the rising number of suicides.

Mr Modi insists the freer trade will benefit farmers by allowing them to earn higher prices by dealing with a greater number of potential buyers.

In his monthly radio address on Sunday, the prime minister said the reforms had “not only broken shackles of farmers but had also given new rights and opportunities to them”.

But the farmers are demanding the new laws be scrapped and are preparing for a prolonged stand-off with the government.

At Singhu border, where Delhi meets Haryana, the convoy of tractors and trucks stretches as far as the eye can see, in a protest that threatens to block five of New Delhi’s major arteries.

The highway has been converted into a makeshift camp, with laundry hanging on clothes lines strung between tractor mirrors, and farmers brewing sweet chai and cooking rotis over open log fires.

Sukhwinder Singh, a 38-year-old farmer, rode on his tractor from Punjab state. He says he is prepared to protest for months, even as the temperature drops during the cool winter nights.

“We have tents, we have our carpets, we have enough food for two months. We don’t feel the cold,” said Mr Singh, wearing a white turban and blue collared shirt. “We are coming here against Modi,” he said, “this bill is not a benefit for our farmers.”

New Delhi’s decision to rush through the legislation by using an emergency executive order has also eroded trust between the farmers and the central government, added Himanshu. “Farmers are suspicious, it points to a mistrust in the system,” he said.

Home minister Amit Shah has said the government will hold talks with the farmers’ unions on Thursday. Yet Bhubinder Singh, a 36-year-old farmer from Amritsar vowed to continue the protest until the reforms are withdrawn. “The government didn’t listen to us,” he said, “that’s why we have to come here.”



Source link

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Emerging Markets

Tech-heavy Taiwan stock index plunges on Covid outbreak

Published

on

By


Taiwan’s stock market, home to some of the world’s biggest tech companies, suffered one of the largest drops in its history as investors were rocked by a worsening Covid-19 outbreak.

The Taiex fell as much as 8.55 per cent on Wednesday, the index’s worst intraday fall since 1969, according to Bloomberg. It finished down 4.1 per cent.

Construction, rubber, automotive and financials — sectors retail investors had been shifting into from technology in recent months — were the worst hit in the sell-off.

The world’s largest contract chipmaker, Taiwan Semiconductor Manufacturing Company, which has a 30 per cent weighting in the index, fell as much as 9.3 before recovering ground to be down 1.9, while Apple supplier Hon Hai Precision Industry, also known as Foxconn, dropped 9.8 per cent before paring losses to be down 4.7 per cent.

While Taiwan’s sell-off was related to domestic Covid-19 problems, it followed recent declines in global markets as investors worried about possible inflationary pressures.

The falls came as Taiwan’s government was expected to partially close down public life to contain a worsening coronavirus outbreak — something the country had managed to avoid for more than a year.

“The reason that triggered the escalated sell-off during the trading session is the new [Covid-19] cases to be reported this afternoon, and probably the raising of the pandemic alert level,” said Patrick Chen, head of Taiwan research at CLSA. “On top of that, the market before today was already at a point where the index was at an inflection point.”

Taiwan’s strict border controls and quarantine system and meticulous contact tracing measures had helped it avoid community spread of Covid-19 until recently.

That success, which allowed Taipei to forego lockdowns, helped boost the local economy, which grew about 3 per cent last year and 8.2 per cent in the first quarter of 2021.

But health authorities announced 16 locally transmitted confirmed cases on Wednesday, for three of which the infection source was unclear — a sign of widening spread in the community. Authorities had confirmed seven untraced cases on Tuesday, and domestic media reported that the government might introduce partial lockdown measures.

President Tsai Ing-wen called on the public to be vigilant but avoid panicking.

Taiwan’s stock market rose almost 80 per cent over the past year, peaking at a historical high late last month. It is now down 8.5 per cent from that mark.

Retail investors have increasingly moved out of technology stocks in recent weeks, reducing the sector’s weight in trading volume from almost 80 per cent at its height to just over 50 per cent.

Coronavirus business update

How is coronavirus taking its toll on markets, business, and our everyday lives and workplaces? Stay briefed with our coronavirus newsletter.

Sign up here



Source link

Continue Reading

Emerging Markets

China factory gate prices climb on global commodities boom

Published

on

By


The price of goods leaving factories in China rose at the fastest pace in more than three years, on the back of a rally in commodities supported by the country’s economic recovery.

The producer price index rose 6.8 per cent in April year-on-year, beating economists’ expectations and surpassing March’s increase of 4.4 per cent.

The rate was driven in part by comparison with a low base last year in the early stages of the pandemic. But it also reflects a global surge in the prices of raw materials that was first stoked by China and now incorporates expectations of recovering global demand.

While PPI prices in China have leapt, economists suggested there was limited spillover into consumer prices and that the central bank was unlikely to react. China’s consumer price index added just 0.9 per cent in April, the National Bureau of Statistics said on Tuesday, although it touched a seven-month high.

“It tells us that demand at this moment is super strong,” said Larry Hu, head of greater China economics at Macquarie, of the PPI data, although he suggested policymakers would see the increase as “transitory” and “look through it”.

“We’re going to see some reflation trends,” he added.

Signs of tightening in China’s credit conditions have drawn scrutiny from global investors eyeing the prospect of higher inflation as the global economy recovers from the pandemic, especially in the US, which releases consumer price data on Wednesday.

China’s PPI index remained mired in negative territory for most of 2020 following the outbreak of coronavirus, but has started to gather momentum this year. Gross domestic product growth in China returned to pre-pandemic levels in the final quarter of 2020.

An industrial frenzy in China has stoked demand for commodities such as oil, copper and iron ore that make up a significant portion of the index and have helped to push it higher. 

Policymakers in China have moved to tighten credit conditions, as well as attempted to rein in the steel sector. Ting Lu, chief China economist at Nomura, said the relevant question now was “whether the rapid rise of raw materials prices will dent real demand, given pre-determined credit growth”.

Retail sales in China have lagged behind the growth rate of industrial production, putting downward pressure on CPI, which has also been weakened by lower pork prices that rose sharply on the back of African swine fever. Core CPI, which strips out food and energy, rose 0.7 per cent in April 

Julian Pritchard-Evans, senior China economist at Capital Economics, said that producer prices were feeding through into the rebound in consumer prices, but also suggested that pressures on the former were “likely to be mostly transient”.

He added that output prices for durable consumer goods were rising at their fastest level on record.

China’s rapid recovery has been driven by its industrial sector, which has churned out record quantities of steel and fed into a construction boom that policymakers are now trying to constrain. On Monday, iron ore prices hit their highest level on record, while copper prices also surged.



Source link

Continue Reading

Emerging Markets

Iron ore hits record high as commodities continue to boom

Published

on

By


The price of iron ore hit a record high on Monday in the latest sign of booming commodity markets, which have gone into overdrive in recent weeks as large economies recover from the pandemic.

The steelmaking ingredient, an important source of income for the mining industry, rose 8.5 per cent to a record high of almost $230 a tonne fuelled by strong demand from China where mills have cranked up production.

Other commodities also rose sharply, including copper, which hit a record high of $10,747 a tonne before paring gains. The increases are part of a broad surge in the cost of raw materials that has lasted more than a year and which is fanning talk of another supercycle — a prolonged period where prices remain significantly above their long term trend.

The price of timber has also hit a record high as US sawmills struggle to keep pace with demand in the run-up to peak homebuilding season in the summer.

“Commodity demand signals are firing on all cylinders amid a synchronised recovery across the world’s economic powerhouses,” said Bart Melek, head of commodity strategy at TD Securities.

Strong demand from China, the world’s biggest consumer of commodities, international spending on post-pandemic recovery programmes, supply disruptions and big bets on the green energy transition explain the surge in commodity prices.

Commodities have also been boosted by a weaker US dollar and moves by investors to stock up on assets that can act as a hedge against inflation.

The S&P GSCI spot index, which tracks price movements for 24 raw materials, is up 26 per cent this year.

Strong investor demand pushed commodity assets held by fund managers to a new record of $648bn in April, according to Citigroup. All sectors saw monthly gains with agriculture and precious metals leading the way, the bank said.

Agricultural commodities have had an especially strong run owing to rising Chinese demand and concerns of a drought in Brazil. Dryness in the US, where planting for this year is under way, is also adding to the upward rise in prices. Corn, which is trading at $7.60 a bushel and soyabeans at $16.22, are at levels not seen since 2013.

“From a macro economic environment to strong demand and production concerns, the ingredients are all there for the supercycle,” said Dave Whitcomb of commodity specialist Peak Trading Research.

Rising copper and iron ore prices are a boon for big miners, which are on course to record earnings that will surpass records set during the China-driven commodity boom of the early 2000s.

Twice weekly newsletter

Energy is the world’s indispensable business and Energy Source is its newsletter. Every Tuesday and Thursday, direct to your inbox, Energy Source brings you essential news, forward-thinking analysis and insider intelligence. Sign up here.

JPMorgan reckons Rio Tinto and BHP will be the largest corporate dividend payers in Europe this year, paying out almost $40bn to shareholders. Shares in Rio, the world’s biggest iron ore producer, hit a record high above £67 on Monday.

Brent crude, the international oil benchmark, has crept back up
towards $70 a barrel, which it surpassed in March for the first time in
more than a year, recovering ground lost as the pandemic
slashed demand for crude and roiled markets.

Supply cuts by leading oil producers have helped to bolster the market
as consumption has begun to recover around the world.

While some Wall Street banks have hailed the start of a new supercycle, with some traders talking of a return to $100 a barrel oil, others are less convinced. The International Energy Agency said oil supplies still remain plentiful meaning any talk of a supercycle is premature.



Source link

Continue Reading

Trending