:00:00. > :00:00.assault against two young girls. Now on BBC News, all the latest
:00:07. > :00:20.business news with Asia Business Report.
:00:21. > :00:23.Led by Prime Minister Tony Abbott, Australia's government gets set to
:00:24. > :00:31.hand down what could be one of the nation's toughest budget in years.
:00:32. > :00:45.`` budgets. Investors react as India wraps up its five weeks of voting.
:00:46. > :00:48.Thank you for joining us. How big of a budget problem does Australia
:00:49. > :00:50.have? We will find out today when the government details its first
:00:51. > :00:56.budget since coming to power late last year. With warnings of a crisis
:00:57. > :00:58.within the nation's finances, Australians are being told they will
:00:59. > :01:04.all have to do the heavy lifting to balance the books. While the local
:01:05. > :01:07.economy is picking up speed, locals are bracing themselves for higher
:01:08. > :01:14.taxes for the rich as well as cuts to welfare and government jobs.
:01:15. > :01:17.Australia managed to chart a safe path through the choppy waters of
:01:18. > :01:21.the global recession, thanks to a mining boom. But the government
:01:22. > :01:28.believes that this lifestyle superpower must endure budget pain
:01:29. > :01:32.to guarantee future prosperity. The budget is something that does
:01:33. > :01:36.need to come down, does need to have some tough measures in it. But I
:01:37. > :01:39.don't think we are as poorly off as people might think we are.
:01:40. > :01:42.I think it will be tough and hit a lot of people who don't want to be
:01:43. > :01:45.hit hard. I think it will be brutal and will
:01:46. > :01:49.hit the middle range. Tax hikes for the rich, cuts to
:01:50. > :01:52.welfare and the raising of the retirement age to 70 are expected to
:01:53. > :01:56.be included in its latest economic blueprint.
:01:57. > :01:58.Economists believe that with a deficit of about 3% of GDP,
:01:59. > :02:07.Australia's financial woes are modest compared with the US and
:02:08. > :02:13.Europe. It is right to say Australia has a
:02:14. > :02:17.budget problem. We have had the biggest boom in our history. We
:02:18. > :02:20.should be running budget surpluses now, not deficits. There is a
:02:21. > :02:23.problem there but we don't have the sort of emergency that we have had
:02:24. > :02:25.over the last years. Australia does have significant
:02:26. > :02:28.challenges. Although unemployment here is low by international
:02:29. > :02:34.standards, at less than 6%, it is expected to rise. And a decade`long
:02:35. > :02:37.mining boom is fading. But economic growth is steady and the weakening
:02:38. > :02:46.currency is helping exporters. So in many ways, Australia remains the
:02:47. > :02:51.lucky country. But academics warn that an overly
:02:52. > :02:55.tough budget could harm the economy. In the medium to long` term, there
:02:56. > :03:00.could be some issues. The resources boom is over, suggesting the good
:03:01. > :03:03.times are over too. There are fundamentally good aspects in the
:03:04. > :03:06.economy and it is a question of sensible stewardship rather than the
:03:07. > :03:10.sort of panic attack we are seeing at the moment.
:03:11. > :03:12.The sand and the surf are part of Australia's famous no`worries
:03:13. > :03:15.lifestyle but the government believes this fun`loving nation is
:03:16. > :03:18.living beyond its means and warns that all Australians will have to
:03:19. > :03:29.share the pain to help balance the books.
:03:30. > :03:33.And the budget will be released this evening in Canberra. We will bring
:03:34. > :03:41.you updates and reactions on tomorrow's bulletin right here on
:03:42. > :03:44.Asia Business Report. One of the key drivers of
:03:45. > :03:46.Australia's economy is China's demand for its resources, with
:03:47. > :03:51.exports highly sensitive to Beijing's slower growth. While the
:03:52. > :03:55.mainland's economic engine has lost momentum, it is not necessarily bad
:03:56. > :03:58.news. I spoke to Mark Williams from Capital Economics, who explained why
:03:59. > :04:13.China slowdown is not something to worry about. `` China's. It is
:04:14. > :04:17.certainly true that the economy is slowing and there has been a sense
:04:18. > :04:20.of panic in some waters of the market, which is massively overdone.
:04:21. > :04:25.You have to remember that the Chinese growth rate has halved since
:04:26. > :04:31.2007, down from 14% to 7% in the past few years. The fact that it is
:04:32. > :04:34.slowing a bit more should not be because of massive concern. If
:04:35. > :04:39.anything, the slowdown we are seeing is positive. It means some of the
:04:40. > :04:46.imbalances in the Chinese economy are eroding. We should not be too
:04:47. > :04:54.worried about it, but where do we see the risks in this slowdown? Is
:04:55. > :04:58.it bad debt? Labour disputes? The focus of concern shifts every few
:04:59. > :05:04.months but the area we should really focus on is property because it has
:05:05. > :05:10.massive oversupply at the moment. And also, it's big enough that if
:05:11. > :05:14.something goes wrong there, it will have widespread repercussions not
:05:15. > :05:21.just in China but around the world. And where is this most being felt in
:05:22. > :05:24.Asia? It's the commodity producers who are most exposed to the sort of
:05:25. > :05:32.slowdown we are seeing at the moment. If the property sector goes
:05:33. > :05:37.down, that will hurt copper, steel and iron ore producers and so on.
:05:38. > :05:41.But at the same time, if the government can work more on consumer
:05:42. > :05:47.demand through spending, producers of consumer goods, of which there
:05:48. > :05:56.are many in this part of the world, should stand to do well. In a few
:05:57. > :06:00.hours, China will unveil its latest retail figures as well as numbers
:06:01. > :06:04.for industrial production, giving us an insight into how Chinese
:06:05. > :06:09.consumers are behaving as well as providing an indication of how the
:06:10. > :06:17.country's manufacturers are doing so far this year. In other business
:06:18. > :06:19.news, Britain's biggest satellite television company BSkyB has
:06:20. > :06:23.confirmed its interest in buying its sister companies in Germany and
:06:24. > :06:26.Italy. The UK broadcasting giant said the move would have the
:06:27. > :06:38.potential to create a world`class multinational pay TV group. Rupert
:06:39. > :06:44.Murdoch owns almost 40% of BSkyB. Several former Barclays executives
:06:45. > :06:48.will be questioned by fraud investigators over a deal with
:06:49. > :06:55.Qatari investors in 2008. They include the former chief executive,
:06:56. > :06:58.Robert Diamond. The Royal Bank of Scotland has announced plans for a
:06:59. > :07:06.public share sale later this year of part of its US affiliate, Citizens
:07:07. > :07:13.Bank. It is expected to raise over 100 million US dollars. After buying
:07:14. > :07:17.citizens bank in 1988, RBS turned it into one of the biggest regional
:07:18. > :07:23.banks in the US. But since being bailed out by the UK government in
:07:24. > :07:29.2008, RBS has been under pressure to sell some of its foreign buildings.
:07:30. > :07:32.Shares in Sharp have risen by more than 4% in Tokyo trading after the
:07:33. > :07:39.firm reported its first annual profit in several years, following a
:07:40. > :07:42.huge restructuring move. Japan's electronics giant reported a net
:07:43. > :07:45.income of $140 million for the 12 months to March, more than double
:07:46. > :07:47.its own forecast. Sharp is the largest maker of LCD screens, which
:07:48. > :07:55.are used in televisions and smartphones. The Indian stock market
:07:56. > :07:58.is about to open, giving investors a chance to react to the early exit
:07:59. > :08:04.polls released last night after the country concluded voting in its
:08:05. > :08:12.five`week long election process. Experts are predicting the BJP under
:08:13. > :08:20.the leadership of Narendra Modi, will form the next government. This
:08:21. > :08:26.is the Bombay stock exchange, located in the heart of India's
:08:27. > :08:30.financial capital. It is perhaps the best indicator as to how investors
:08:31. > :08:36.are feeling, and in the past few months, the only way has been up.
:08:37. > :08:41.Time after time, the market has seen new record highs. Foreign investors
:08:42. > :08:45.have put more than $5 billion into Indian companies in the last five
:08:46. > :08:49.months and it is a frenzied driven by growing opinion that India is set
:08:50. > :08:55.for a change in government. The polls have placed the coalition
:08:56. > :09:06.headed by the BJP as the frontrunner to the next government. The people,
:09:07. > :09:10.the markets, what a government led by Narendra Modi. They also vote
:09:11. > :09:15.that he can do it without the support of his coalition partners
:09:16. > :09:20.and can do it alone, with a clean sweep. That would lead to a great
:09:21. > :09:26.deal of stability as far as policy is concerned. They won't have to
:09:27. > :09:32.dance to the tune of coalition partners. Many are expecting sharp
:09:33. > :09:38.rises when trading against on Tuesday, but some are arguing
:09:39. > :09:41.caution. The opinion polls have been absolutely wrong during the previous
:09:42. > :09:47.two elections, and that has left many investors worried, fearing that
:09:48. > :09:52.the stock markets could fall dramatically if the final result due
:09:53. > :09:54.on Friday turned out to be different from what the polls have been
:09:55. > :10:00.predicting. But whatever happens today, the long`term mood of
:10:01. > :10:05.investors both from home and abroad will be determined not by what
:10:06. > :10:13.people are predict it will happen but by who takes power when the
:10:14. > :10:19.results are in. Now, taking a look at the stock markets at the moment.
:10:20. > :10:29.They are in positive territory after gains in the US technology and
:10:30. > :10:41.biotechnology sector. Thank you for investing your time with us on Asia
:10:42. > :10:45.Business Report. Goodbye. This is BBC News. The headlines: The United
:10:46. > :10:47.States has revealed it is flying manned surveillance missions over
:10:48. > :10:48.Nigeria to help