31/05/2017 World Business Report

Those are the main story so far. Now it is time to catch up with all the

business news in World Business Report. -- stories.

How does a country survive without big banknotes?

We'll find out when the Indian government releases economic growth

And it's almost like a game of hide and seek.

Passengers involved in the disruptions of BA flights

over the weekend desperately seeking their luggage,

Hello and welcome to World Business Report.

In a minute we'll take a snapshot of the Chinese economy,

in a few hours time, the latest official statistics

are expected to show that India has retained its crown as the fastest

Economists are predicting that India expanded at an annual rate of 7.1%

in the first three months of the year.

Now, this compares with growth of 6.9% for China.

The resilience of the Indian economy will come as welcome news

to Prime Minister Narendra Modi, following the country's landmark

Towards the end of last year, the government removed some 86%

of banknotes from circulation, in a bid to crackdown on corruption.

This led to widespread disruption and queues outside banks

and cashpoints, but the shock announcement seems to have had

And there could be yet more good news for the Indian economy -

in a month's time, consumers are set to benefit from a major tax reform.

From July 1, all purchases will fall under a single goods

This will lower the average tax rate compared to the existing system.

It is difficult for us to adhere to the 7% growth rate in the country.

There has been a partial breakdown of the rural economy. Incomes have

not risen. People are holding back on any nondiscretionary expense,

which is bad for business in general.

The last few years and especially the last few months have been very

bad for the real estate development market. The market has been under

pressure, and adding fuel to the fire has been the monetisation. --

demonetisation. The water industry which we have

been working in since 1958 is going well. There are ups and down. There

was a setback due to demonetisation, but the inherent structure of the

industry is robust. The Indian economy will be at 7- 8%. We will

reach that. British Airways says it is "working

round the clock" to reunite passengers with their bags

but it will take some days Many people have contacted BA

on social media to complain they still do not have

their luggage back. The airline is now operating a full

flight schedule and its IT systems are up and running after the systems

failure over the weekend. Thousands of flights were cancelled

with 75,000 people affected. So, what kind of damage

will this do to BA? With me is John Strickland,

aviation and airlines expert So John, still thousands of angry

customers. What long-term damage could there be to BA, do you think?

The airline will have two work to get the flying programme back into

normality, as they are doing right now. The baggage problem will be

sold as you describe. But they are premium airline. They rely on

premium customers. These are the ones who play the most, but also

they are feeling a lot of their economy seats. -- pay. They need to

restore the trust in a competitive market. Market competition means

they have people like Ryanair, snapping at their heels with cost

effective fights, and premium airlines like Emirates. The cost

cutting me to be down slightly. They need to deliver reliability and

integrity, which they want to suggest they offer. Now manager

wants to show that they are doing a wash up of the rubble and

communicate transparently. What they have found was the problem and how

will they will avoid it in the future. What impact do you think

this will have on Heathrow as an international hub? A few years ago,

when British Airways moved into Terminal 5, which is the epicentre

of this challenge of the last weekend, Terminal 5 itself went into

meltdown on its first day of operation. That was not good for BA

or Heathrow. But they recovered from that. In that sense, there is hope.

Investors will be looking at the financial performance. Looking back

to that as an example, BA did recover. They worked hard to do it,

but they did it in a faraway and restored faith and went on to bigger

and better things but in terms of customers and profitability. Delta,

who has a hub in Atlanta, they had a major IT outage in Atlanta last

year. This will require a complete management focus. This will need

focus on processes and customers as well a star. That is how they have

to do it because it is the only way to protect their business position.

John Strickland, to give for joining us.

Growth in it's manufacturing sector in May kept pace

The closely watched official Purchasing Managers' Index stood

Lets go to Sharanjit Leyl in our Singapore Bureeau.

Sharanjit, you have been talking to a well known investor into China.

How confident was he about the robustness

He is very confident indeed. I will show you what he had to say in just

a little bit. But interesting that you mentioned those purchasing

managers index. It separates growth from contraction. Beijing has been

cracking down on financial risk and there has been a mixed picture.

Other recent dated showed that profits slowed to its weakest point

in four months. -- data. This came after Moodys downgraded their credit

rating for the first time since 1989. But I can go into that -- but

I can go onto that investor. He still believes in his investments

there. China is a planned economy. What the government plans is what

happens. Because the government controls the major banks, controls

the major features of the economy, the biggest companies, so if they

want 6% growth, they will get it. They are not fixing the numbers.

They do is poor more money on. However, there is a problem in the

private sector. Many of these companies have borrowed too much and

were dealt a payback. -- pour. And there will be in trouble. And to

govern it is well aware of the dangers, which is why it they will

need to tighten up. Sharon -- Sharanjit Leyl, thank you very

much. Shares in online retail giant Amazon

have risen above the $1,000 mark It originally listed its shares

in May 1997 for just $18 each. Amazon now has a market

capitalisation of about $478 billion,

which is more than twice Amazon is now the fourth-largest US

company by market capitalisation, behind Apple, Google owner

Alphabet, and Microsoft. Sterling dropped more than half

a percent against the dollar late Tuesday after a new poll found that

British Prime Minister Theresa May's Conservative Party risks falling

short of an overall majority in next Previous opinion polls suggested

the conservative party would increase their majority,

which is currently 17 seats. Let's check in with

the financial markets now. Despite those robust

manufacturing figures from China it's been a bit of a lacklustre

trading session for many That is all of the business news for

now. Much more to come.