India's forex reserves rise after falling for three weeks in row
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Time of India
3 hours ago
- Time of India
GCC GDP 2024: Real and nominal figures differ, but both show non-oil sectors make up over 70%
In 2024, non-oil sectors made up 77.9% of nominal GDP and 70.6% of real GDP across the GCC/ Image: FIle The Gulf Cooperation Council (GCC) economies showed steady growth in 2024, with rising contributions from non-oil sectors offsetting a decline in oil output. Real GDP rose 3.3% in the fourth quarter, backed by strong performance in manufacturing, trade, and construction. This marks a continuing shift away from oil dependence, reinforced by national reform programs and increased investment in non-hydrocarbon industries. Real GDP – Growth despite oil sector contraction In constant price terms, or real GDP, the total output of the six GCC countries rose by 3.3% in Q4 2024, reaching USD 456.3 billion, compared to USD 442.3 billion in Q4 2023. Quarter-on-quarter, the region's economy expanded by 1%, rising from USD 452.2 billion in Q3 2024. The bulk of this real GDP came from non-oil sectors, which made up 70.6% of total real GDP in Q4. In contrast, oil-related activities contributed the remaining 29.4%. Looking at the year as a whole, the overall real GDP across the GCC rose by 2.4%. However, this masks a notable divergence between sectors: Non-oil GDP increased by 3.7%, driven by robust growth in industry and services. Oil GDP declined by 0.9%, primarily due to voluntary production cuts under the OPEC+ framework. Country-wise, Qatar recorded the highest annual increase in real GDP at 4.5%, followed by the UAE at 3.6%, and Saudi Arabia at 2.8%. In Saudi Arabia, non-oil activities grew by 4.6%, while oil activities contracted by 4.5%, indicating a substantial shift in the country's economic composition. Nominal GDP – Growth tempered by market prices In nominal terms (i.e., unadjusted for inflation), the GCC's GDP rose by 1.5% year-on-year, reaching USD 587.8 billion by the end of Q4 2024, up from USD 579 billion in Q4 2023. Unlike real GDP, nominal GDP reflects current market prices, and can be influenced by inflation or deflation. While the overall increase was modest, the non-oil sector's contribution to nominal GDP was higher at 77.9%, showing a broader diversification trend in monetary terms. The remaining 22.1% came from oil activities, a significantly lower share compared to their contribution in real terms. This disparity suggests that while oil remains a large physical output driver, price pressures and production curbs have diminished its monetary weight in the economy. Sector contributions – Manufacturing and trade lead A closer breakdown of nominal GDP reveals the growing role of diverse non-oil industries: Manufacturing: 12.5% Wholesale and Retail Trade: 9.9% Construction: 8.3% Public Administration and Defence: 7.5% Finance and Insurance: 7% Real Estate Activities: 5.7% Other Non-Oil Activities: 27% These sectors have underpinned the GCC's non-oil expansion, with each contributing steadily to national and regional outputs. In Saudi Arabia specifically, the National Industrial Development and Logistics Program (NIDLP) contributed SAR 986 billion (USD 262.8 billion) to non-oil GDP, accounting for 39% of Saudi Arabia's non-oil economic output. Non-oil activities now represent 55% of Saudi Arabia's total GDP. This growth has been supported by government spending, which increased by 2.6% in Saudi Arabia during 2024, enabling momentum in infrastructure, services, and industry. Reform agendas and future outlook The GCC's shift from oil-dependency to broader economic resilience is no longer just policy ambition — it is increasingly reflected in macroeconomic data. Growth in 2024 was driven by sectors aligned with national strategic reforms: Saudi Vision 2030 UAE Economic Vision Qatar National Vision 2030 Oman Vision 2040 These plans emphasize tourism, logistics, manufacturing, finance, and digital infrastructure, backed by regulatory changes and significant public-private investment. The year's data confirms that these structural transformations are not only underway but are starting to deliver tangible economic diversification. Despite setbacks from oil market volatility, the region is expanding in real output, broadening its industrial base, and recalibrating its sources of long-term growth. Real vs. nominal GDP – Simplified To help readers understand the two metrics used: Real GDP adjusts for inflation, showing actual physical output growth or contraction. It's more useful for comparing economic performance over time. Nominal GDP is the economy's total value of goods and services using current prices, reflecting the monetary size of the economy but can be skewed by price changes. In the GCC's case, real GDP growth (3.3%) outpaced nominal GDP growth (1.5%), which suggests that while the region is producing more goods and services, price effects (like lower oil prices) dampened the apparent value increase.
Time of India
3 hours ago
- Time of India
RBI announcements on Wednesday: Banks keep an eye on new liquidity, co-lending norms
Bankers are looking forward to two important announcements from the RBI—revised liquidity management framework and final norms on co-lending arrangements between lenders—on Wednesday, after the three-day monetary policy meeting, according to industry executives. ET finds out: Productivity Tool Zero to Hero in Microsoft Excel: Complete Excel guide By Metla Sudha Sekhar View Program Finance Introduction to Technical Analysis & Candlestick Theory By Dinesh Nagpal View Program Finance Financial Literacy i e Lets Crack the Billionaire Code By CA Rahul Gupta View Program Digital Marketing Digital Marketing Masterclass by Neil Patel By Neil Patel View Program Finance Technical Analysis Demystified- A Complete Guide to Trading By Kunal Patel View Program Productivity Tool Excel Essentials to Expert: Your Complete Guide By Study at home View Program Artificial Intelligence AI For Business Professionals Batch 2 By Ansh Mehra View Program by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like 15 Foods That Can Lower Your Blood Pressure Undo
Time of India
3 hours ago
- Time of India
NBFCs nudge RBI for lower risk weight on loans against property
In their discussions with the Reserve Bank of India (RBI), non-banking financial companies have requested LAPs be not treated on a par with unsecured loans when assigning risk weights. They have urged the RBI to reduce the current cap of 125% and align more closely with home loans, which attract risk weights in the range of 35% to 50%. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads MUMBAI: Non-bank lenders have approached the central bank to ease, among other curbs, prescribed risk weights on products such as loans against property (LAP), arguing the risk profiles of such assets do not justify bracketing them together with unsecured exposures, or even plain-vanilla mortgages."In our experience, losses on LAP have been significantly lower compared to housing loans, primarily because transaction risks tend to be higher in housing finance," one of the two officials aware of the development told ET. "Risk weights for LAP should ideally be lower or, at very least, on a par with housing their discussions with the Reserve Bank of India ( RBI ), non-banking financial companies have requested LAPs be not treated on a par with unsecured loans when assigning risk weights. They have urged the RBI to reduce the current cap of 125% and align more closely with home loans , which attract risk weights in the range of 35% to 50%."There is no justification for equating them with the risk weights applied to personal or unsecured business loans," said the first official cited above. NBFCs have also urged loan-to-value (LTV) ratios on LAP be regularised with home loans. At present, LTVs on home loans can range from 80-90% but for LAP the range is 50-75%.NBFCs have urged the central bank to allow refinancing of self-construction loans in cases where construction is already more than 50% complete."Loan against property is a safer business compared to home loans because it is backed by completed properties, whereas home loans often carry completion risk when the property is still under construction," said the second official cited above. "The title deed for LAP is available upfront. For home loans in markets like Delhi-NCR, the title deed is often executed only upon completion, which poses a risk if the project remains unfinished."NBFCs have also urged the RBI to ensure a level playing field in the enforcement of SARFAESI (Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest) housing finance companies (HFCs) are permitted to invoke SARFAESI for loan exposures above ?1 lakh, while for NBFCs, the threshold is significantly higher at ?20 lakh. Industry players argue that this disparity puts NBFCs at a disadvantage and have requested that the ?1 lakh threshold be uniformly applied. At the very least, they contend, loans against property disbursed by NBFCs should be brought under the ?1 lakh eligibility to enable more effective have also requested to revise the computation methodology for principal business criteria (PBC), suggesting that it be based solely on loan assets, rather than the total balance sheet size.
