:00:00. > :00:08.Those are the main story so far. Now it is time to catch up with all the
:00:09. > :00:18.business news in World Business Report. -- stories.
:00:19. > :00:23.How does a country survive without big banknotes?
:00:24. > :00:26.We'll find out when the Indian government releases economic growth
:00:27. > :00:32.And it's almost like a game of hide and seek.
:00:33. > :00:34.Passengers involved in the disruptions of BA flights
:00:35. > :00:45.over the weekend desperately seeking their luggage,
:00:46. > :00:54.Hello and welcome to World Business Report.
:00:55. > :01:00.In a minute we'll take a snapshot of the Chinese economy,
:01:01. > :01:05.in a few hours time, the latest official statistics
:01:06. > :01:09.are expected to show that India has retained its crown as the fastest
:01:10. > :01:14.Economists are predicting that India expanded at an annual rate of 7.1%
:01:15. > :01:16.in the first three months of the year.
:01:17. > :01:18.Now, this compares with growth of 6.9% for China.
:01:19. > :01:21.The resilience of the Indian economy will come as welcome news
:01:22. > :01:24.to Prime Minister Narendra Modi, following the country's landmark
:01:25. > :01:27.Towards the end of last year, the government removed some 86%
:01:28. > :01:30.of banknotes from circulation, in a bid to crackdown on corruption.
:01:31. > :01:33.This led to widespread disruption and queues outside banks
:01:34. > :01:35.and cashpoints, but the shock announcement seems to have had
:01:36. > :01:43.And there could be yet more good news for the Indian economy -
:01:44. > :01:47.in a month's time, consumers are set to benefit from a major tax reform.
:01:48. > :01:50.From July 1, all purchases will fall under a single goods
:01:51. > :02:22.This will lower the average tax rate compared to the existing system.
:02:23. > :02:34.It is difficult for us to adhere to the 7% growth rate in the country.
:02:35. > :02:40.There has been a partial breakdown of the rural economy. Incomes have
:02:41. > :02:42.not risen. People are holding back on any nondiscretionary expense,
:02:43. > :02:53.which is bad for business in general.
:02:54. > :03:00.The last few years and especially the last few months have been very
:03:01. > :03:06.bad for the real estate development market. The market has been under
:03:07. > :03:15.pressure, and adding fuel to the fire has been the monetisation. --
:03:16. > :03:39.demonetisation. The water industry which we have
:03:40. > :03:43.been working in since 1958 is going well. There are ups and down. There
:03:44. > :03:49.was a setback due to demonetisation, but the inherent structure of the
:03:50. > :03:51.industry is robust. The Indian economy will be at 7- 8%. We will
:03:52. > :03:53.reach that. British Airways says it is "working
:03:54. > :03:55.round the clock" to reunite passengers with their bags
:03:56. > :03:58.but it will take some days Many people have contacted BA
:03:59. > :04:05.on social media to complain they still do not have
:04:06. > :04:10.their luggage back. The airline is now operating a full
:04:11. > :04:14.flight schedule and its IT systems are up and running after the systems
:04:15. > :04:17.failure over the weekend. Thousands of flights were cancelled
:04:18. > :04:19.with 75,000 people affected. So, what kind of damage
:04:20. > :04:22.will this do to BA? With me is John Strickland,
:04:23. > :04:31.aviation and airlines expert So John, still thousands of angry
:04:32. > :04:37.customers. What long-term damage could there be to BA, do you think?
:04:38. > :04:41.The airline will have two work to get the flying programme back into
:04:42. > :04:46.normality, as they are doing right now. The baggage problem will be
:04:47. > :04:49.sold as you describe. But they are premium airline. They rely on
:04:50. > :04:54.premium customers. These are the ones who play the most, but also
:04:55. > :05:02.they are feeling a lot of their economy seats. -- pay. They need to
:05:03. > :05:06.restore the trust in a competitive market. Market competition means
:05:07. > :05:11.they have people like Ryanair, snapping at their heels with cost
:05:12. > :05:21.effective fights, and premium airlines like Emirates. The cost
:05:22. > :05:25.cutting me to be down slightly. They need to deliver reliability and
:05:26. > :05:28.integrity, which they want to suggest they offer. Now manager
:05:29. > :05:32.wants to show that they are doing a wash up of the rubble and
:05:33. > :05:36.communicate transparently. What they have found was the problem and how
:05:37. > :05:42.will they will avoid it in the future. What impact do you think
:05:43. > :05:47.this will have on Heathrow as an international hub? A few years ago,
:05:48. > :05:50.when British Airways moved into Terminal 5, which is the epicentre
:05:51. > :05:54.of this challenge of the last weekend, Terminal 5 itself went into
:05:55. > :05:59.meltdown on its first day of operation. That was not good for BA
:06:00. > :06:04.or Heathrow. But they recovered from that. In that sense, there is hope.
:06:05. > :06:07.Investors will be looking at the financial performance. Looking back
:06:08. > :06:12.to that as an example, BA did recover. They worked hard to do it,
:06:13. > :06:15.but they did it in a faraway and restored faith and went on to bigger
:06:16. > :06:20.and better things but in terms of customers and profitability. Delta,
:06:21. > :06:28.who has a hub in Atlanta, they had a major IT outage in Atlanta last
:06:29. > :06:35.year. This will require a complete management focus. This will need
:06:36. > :06:40.focus on processes and customers as well a star. That is how they have
:06:41. > :06:43.to do it because it is the only way to protect their business position.
:06:44. > :06:47.John Strickland, to give for joining us.
:06:48. > :06:51.Growth in it's manufacturing sector in May kept pace
:06:52. > :06:55.The closely watched official Purchasing Managers' Index stood
:06:56. > :06:59.Lets go to Sharanjit Leyl in our Singapore Bureeau.
:07:00. > :07:02.Sharanjit, you have been talking to a well known investor into China.
:07:03. > :07:04.How confident was he about the robustness
:07:05. > :07:14.He is very confident indeed. I will show you what he had to say in just
:07:15. > :07:21.a little bit. But interesting that you mentioned those purchasing
:07:22. > :07:27.managers index. It separates growth from contraction. Beijing has been
:07:28. > :07:31.cracking down on financial risk and there has been a mixed picture.
:07:32. > :07:40.Other recent dated showed that profits slowed to its weakest point
:07:41. > :07:44.in four months. -- data. This came after Moodys downgraded their credit
:07:45. > :07:52.rating for the first time since 1989. But I can go into that -- but
:07:53. > :07:57.I can go onto that investor. He still believes in his investments
:07:58. > :08:02.there. China is a planned economy. What the government plans is what
:08:03. > :08:06.happens. Because the government controls the major banks, controls
:08:07. > :08:10.the major features of the economy, the biggest companies, so if they
:08:11. > :08:14.want 6% growth, they will get it. They are not fixing the numbers.
:08:15. > :08:20.They do is poor more money on. However, there is a problem in the
:08:21. > :08:24.private sector. Many of these companies have borrowed too much and
:08:25. > :08:28.were dealt a payback. -- pour. And there will be in trouble. And to
:08:29. > :08:29.govern it is well aware of the dangers, which is why it they will
:08:30. > :08:40.need to tighten up. Sharon -- Sharanjit Leyl, thank you very
:08:41. > :08:43.much. Shares in online retail giant Amazon
:08:44. > :08:47.have risen above the $1,000 mark It originally listed its shares
:08:48. > :08:53.in May 1997 for just $18 each. Amazon now has a market
:08:54. > :08:55.capitalisation of about $478 billion,
:08:56. > :08:57.which is more than twice Amazon is now the fourth-largest US
:08:58. > :09:02.company by market capitalisation, behind Apple, Google owner
:09:03. > :09:05.Alphabet, and Microsoft. Sterling dropped more than half
:09:06. > :09:08.a percent against the dollar late Tuesday after a new poll found that
:09:09. > :09:11.British Prime Minister Theresa May's Conservative Party risks falling
:09:12. > :09:14.short of an overall majority in next Previous opinion polls suggested
:09:15. > :09:19.the conservative party would increase their majority,
:09:20. > :09:29.which is currently 17 seats. Let's check in with
:09:30. > :09:35.the financial markets now. Despite those robust
:09:36. > :09:37.manufacturing figures from China it's been a bit of a lacklustre
:09:38. > :09:54.trading session for many That is all of the business news for
:09:55. > :10:00.now. Much more to come.