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Thursday newspaper round-up: Lloyds of London, Gas, Syria

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Lloyd’s chairman warns on ‘systemic risk’ of capital rush; subsidies for gas storage ruled out; opposition party attacks Hollande’s decision over Syria.

Raghuram Rajan has taken charge of India’s central bank, with the former International Monetary Fund Chief economist warning he will take unpopular steps to tackle the country’s worst economic crisis in decades. The new Reserve Bank of India Governor announced his “big initial package” to arrest slowing growth and support a currency that has plunged to record lows, The Daily Telegraph says.

The Chairman of Lloyd’s of London has warned of the danger that a rush of capital into the insurance industry will cause “systemic problems” akin to those of the banking sector during the financial crisis. John Nelson, head of the historic insurance market, spoke out about the risks of adverse consequences from non-traditional funding of insurance, which he said was occurring “on a scale not seen before,” the FT reports.

Ministers have rejected calls to subsidise new gas storage facilities, insisting Britain has plentiful gas supplies and that subsidies would be an expensive waste of bill-payers’ money. The controversial decision will raise fears of prices spiking when supplies run low and is likely to see large, seasonal gas storage projects, such as Centrica’s proposed £1.4bn Baird facility, shelved indefinitely, The Daily Telegraph writes.

Britain was facing an “economic crisis” in 2010, according to a Labour policy document released today which uses language likely to irritate Ed Balls.
The release of the Armitt Review came as the Shadow Chancellor and his party recognised the improvement in economic data in recent months by dropping accusations that the economy is “flatlining,” The Times explains.

President François Hollande’s commitment to join the US in taking military action against Syria has come under bitter attack from France’s mainstream opposition party, which accuses him of isolating the country and making it hostage to the US Congress. In an often bad-tempered parliamentary debate on Syria, the leader of the centre-right UMP’s parliamentary group said Mr Hollande’s willingness to take part in a strike on Syria without UN authorisation amounted to a “fundamental change of doctrine” for France that put in danger its influence on the world stage, the Financial Times says.