Shuchi Aggarwal
Shikha Yadav
Shivendra Pratap Singh
Section E
Small Investors may get bigger share in PSU floats,Pg.1
The department of disinvestment plans to pitch for a higher quota for retail investors in forthcoming share sales at state-run companies, as it looks to use the buzz generated by the Coal India IPO to take equity culture to Indian households. Existing norms stipulate that at least 35% of the shares offered in a book-built share sale, where investors are asked to bid in a pre-decided price band, must be reserved for retail investors.
The retail portion of the Coal India offer was subscribed 2.31 times, providing a fitting backdrop for an increase in the quota for retail investors.
senior finance ministry official said “With more purchasing power in the hands of retail investors, we expect good response from them and The idea is to share the wealth of public sector companies with the public” The move is aimed at sharing public wealth with small investors, spreading equity culture to a wider population, and broad-basing the market.
In 2009-10, public offers from PSUs, including that of power producer NTPC, received lukewarm response from retail investors. The retail portion of the NTPC offer was subscribed just 0.16%. The offers from REC and NMDC also met the same fate, with their retail portions failing to attract enough investors. Market analysts attribute this to aggressive pricing. All these issues received an overwhelming response after the government cut the offer price.
Given the budgeted divestment target of Rs 40,000 crore, state-owned companies will be the biggest issuers in the current financial year. Some of the major companies expected to hit the market this year are ONGC , IOC and Steel Authority of India.
IFRS norms may be diluted before rollout,pg.1
the government plans to dilute some key provisions relating to foreign exchange differences and overseas borrowings which will make global investors suspect Indian accounting, say three people closely associated with the development. In the case of accounting for foreign exchange differences that rise because of currency derivatives taken by firms, the government is looking at an option where companies need not provide for any loss in the profit and loss statement but rather just carry forward the value as at the end of March 2011, according to a ministry of corporate affairs official, who declined to be named as he is not authorized to talk with the media.
The National Advisory Committee on Accounting Standards (NACAS), an advisory body for the corporate affairs ministry, is in favor of allowing companies not to provide for mark-to-market (MTM) losses on their foreign currency convertible bonds (FCCBs), says a member of the advisory board.
MTM is an accounting principle where the value of the contract is marked at current exchange rate for currency derivatives and current bond price for FCCBs. both dilutions will be major departures from what the International Financial Reporting Standards (IFRS) prescribe. It has huge upside for India Inc in the short term by helping it to avoid reporting such MTM losses prescribed by IFRS. But it may work to its detriment in the long term by making companies unattractive to global investors.
When companies first adopt IFRS, the standards lay out a procedure on how to treat the foreign exchange differences. It gives two options — the first is to reduce it from the profits and the second is to revalue all the assets in the balance sheet and adjust the loss arising from exchange differences with the reserve created from such revaluation. Both will have a negative impact — one will reduce the profits and the other would shrink the balance sheet. So, companies have sought dilution of the provision.
The whole issue of accounting for changes in foreign exchange rates came to the forefront during global financial crisis, after Lehman Brothers collapse.
Many exporters and foreign loan holders took cross-currency derivatives to hedge their exposure not just to protect them from currency movements but also to make profit from such bets. They placed their bet on so-called safe currencies like Japanese yen or Swiss franc. But when the crisis was at the peak, both the yen and the franc moved in ways not seen for years. Japanese yen fell below 100 mark against the dollar for the first time. The extent of losses are not known, but the Reserve Bank of India in its submission to the Orissa High Court stated the mark-to-market losses for customers who bought these derivative products were estimated at Rs 37,719 crore in December 2008. Further, it said 22 banks that sold complex derivative products lost Rs 756 crore as of December 2008.
MARKET
Shrinking Bank revenue signals growth worries,Pg.19
shrinking revenue at US banks, led by Goldman Sachs Group and Citigroup, may continue to fall as the industry heads into what could be its slowest period of growth since the Great Depression .
After the six largest US banks posted record revenue in 2009, combined net revenue fell by an average of 8% in the third quarter from a year earlier and 16.3% over the last two quarters, according to data compiled by Bloomberg.
Revenue so far this year is down by 4.1%, driven by declines in everything from trading at Goldman Sachs to home lending at Bank of America. New laws restricting account and credit-card fees, as well as derivatives and capital rules, are also squeezing lenders.
Next year will kick off a decade that will bring the “worst revenue growth” for US banks in 80 years, according to Mike Mayo, an analyst at Credit Agricole Securities in New York. Net revenue at US commercial lenders has expanded at a slower pace in each of the last three decades , falling to 6% in the last decade from 12% in the 1970s, says Federal Deposit Insurance data.
“Revenues aren’t just weak for this quarter, or even for this upcoming year, but for the entire upcoming decade,” said Mayo, a former Federal Reserve analyst, who has more than 20 years of industry experience . “The speed limit’s been lowered for how fast banks can drive earnings.”
The trend over the last two quarters is hitting almost every line of income statements and is spread across the sector, affecting investment banks, consumer banks and commercial lenders. It’s eating away at profits, depressing stock prices and threatening bonuses and new hiring.
Economy
Warehousing Act comes into force, receipts now negotiable,pg.27
The Prime Minister’s Economic Advisory Council has recommended cross-representation of the Forward Markets Commission (FMC), the Bureau of Indian Standards (BIS) and the newly formed Warehousing Development and Regulatory Authority (WDRA) on each others’ boards.
This is for better coordination among the regulators involved in the entire chain of warehousing and warehousing receipts, its tradability and delivery. And, to address disputes arising among end-users involved in the chain.
The receipt representing goods stored in warehouses will be traded on exchanges regulated by FMC. These receipts, to be eligible for trading, should represent universally accepted quality parameters of the goods to be delivered on expiry of receipts. These parameters of the processes and infrastructure involved in supply and storage of goods will be worked out by BIS.
So, having representation on each others’ boards would facilitate development of warehouse receipts and their tradability, since WDRA could draw upon the expertise of FMC and BIS in setting up quality parameters for goods and specification of receipt for trading. Warehouses play an important role in commodities futures, as most trades are settled with delivery.That is, if the seller chooses to hand over the commodity instead of the difference in cash, the buyer must take physical delivery of the underlying asset. A warehousing system and warehouse receipts act as the chain, connecting farmers with the futures market and credit financing.
A warehouse receipt is a document that provides proof of ownership of commodities (e.g., rice or wheat or bars of copper) e stored in a warehouse, vault or depository for safekeeping. Negotiable warehouse receipts allow transfer of ownership of that commodity without having to deliver the physical commodity. These receipts are also used as collateral for loans for bank financing. It may also show transfer of ownership for immediate delivery or for delivery at a future dateRather than delivering the actual commodity, negotiable warehouse receipts are used to settle expiring futures’ contracts. Their usage for futures’ trading thus helps in curbing wastage, especially in agricultural commodities, since the goods are not moved.
Commodities
Iron ore prices may soften in 3-6 weeks,Pg.26
The government is likely to finally allow iron ore futures trading by this month-end, chairman of the Forward Markets Commission, the commodity derivatives market regulator in India, said on Tuesday. The iron ore contract proposal was made by the Indian Commodity Exchange (ICEX), which is part-owned by state-run MMTC Ltd (MMTC.BO), which is the biggest Indian trader of the commodity.
Iron ore contracts in India, the world's third-largest producer of the ore, will help small exporters to hedge risk against fluctuating prices, traders and analysts said.
On sugar futures launch, Khatua said the launch of November expiry contract is not likely.
"Most likely December expiry contract will be the first one to be launched."
A bon on sugar futures trade by the government had lapsed on Sept. 30, after the world's biggest consumer expected sharp recovery in the local output.
However, the regulator has been studying proposals from the exchanges before giving the final go-ahead.
"We may decide on a few changes in the contract specification to improve the contract," said Khatua, adding, he will meet stakeholders in the sugar industry to improve the contract.
The Political Theatre
Australia pays up for CWG damages,Pg.2
The Australian mission at Commonwealth Games has paid Rs 10,000 as damages for the vandalism of some members of its squad who threw down a washing machine from the seventh floor of a Games Village apartment.
The alcohol-fuelled vandalism, first reported by TOI, could have taken a fatal turn if the machine had struck someone and led to condemnation of the behaviour of Aussie athletes concerned though no formal complaint was lodged. The amount paid covers the cost of the washing machine. No fine was imposed.
Australian squad were involved in at least two other incidents of overly boisterous behaviour in the dining area and on one occasion were led away by their managers.
The incidents were brushed aside as CWG organisers decided not to lodge a complaint while Aussie officials denied the incident (of the washing machine being thrown) had anything to do with the Test side losing to India in cricket.
Thursday, October 28, 2010
27th October - Newspaper Summary
SAKET GARG
SANDIPAN MONDAL
SATYENDRA YADAV
SECTION H
Tayal moves court to unlock ICICI shares
The News:
Pravin kumar Tayal, promoter of the erstwhile Bank Of Rajasthan Ltd has moved the Rajasthan High court to access ICICI Bank shares worth at least Rs. 1000 crore.
The back Ground:
SEBI had frozen the demat account of Pravin Kumar Tayal and 100-odd related entities which owned Bank Of Rajasthan shares for alleged violation of regulatory norms
The Impact:
A court order in their favour would allow them to encash shares and clear liabilities to many banks.
Bharti prepay part of $7.5 bn loan
Bharti Airtel Ltd may prepay at least $1 billion (Rs.4,440 crore) of the $7 bn loan it took from banks to funds its acquisition of the African assets of Kuwait-based Zain Telecom according to a banker familiar with the development. The flexibility of prepayment has always been part of the loan agreement and Bharti has the option of prepaying based on its cash flow.
Venky’s hatches plan to buy English Football club
A Pune poultry farm and hatchery with global aspirations is set to become the country’s firsh owner of an English football club,albeit a bottom-of-the-league team.
Venkateswara Hatcheries Group, or VH group, is in advanced negotiation to acquire “Blackburn Rovers”, according to the both group and the club.
The group will pay 46 million pound (approx. Rs.322 crore) to buy the club, Bloomberg reports.
“Blackburn Rovers” the English Premier League (EPL) champion in 1995, currently standing fourth from bottom, having own nine points from as many matches.
Rupee gets its place on the keyboard-next to the dollar
The symbol for the Indian rupee will start appearing alongside the dollar sign $ and numeral 4 on computer keyboard by the middle of next year.
“It has been decided to place the rupee symbol on the right side of the 4 numeral key, where the dollar sign is also there”,said N.Ravi Shankar, joint secretary, depertment of information technology (DIT).
An official at leading PC manufacturer HCL Infosystem Ltd confirmed the development.
S.Rajendran chief marketing officer of another PC manufacturer, ACER India Pvt. Ltd, said the company will start putting the symbol on its keyboards one software companies such as Microsoft Crop. and other stakeholders also integrate it.
User Development Fees Increased--GHIAL
Hyderabad is set to become the most expensive airport to fly from. The user development fees is going to be increased from 1 November. The UDF has been raised by 26% and 87% for the passengers flying within country and abroad respectively. The Airport Economic Regulatory Authority(AERA) has taken this decision.GMR Hyderabad International Pvt. Ltd.(GHIAL) airport began charging Rs.350 from departing domestic passengers and Rs.907 from international passengers including taxes. AERA has consulted to the authority for taking this decision. And this decision will result in the profits of Rs.650crore for next three years. GHIAL suffered losses of Rs.120 crore in 2008-09 and Rs.109.22 crore in 2009-10.
Losses Lower Down Of Q2 By IBN18, TV18
Network 18 Media and Investment Ltd’s subsidiary IBN18 Broadcast Ltd narrowed its second quarter loss to Rs.13 crore from Rs.82 crore in the same period a year earlier. IBN18’s revenue increased 39% in the threemonths to end September, boosted mainly by Viacom 18, which runs channels such as Colors, Nick and VH1. Haresh Chawla, group chief executive, Network 18, said the company’s losses were minimized because of investments that came through in phases for all its brands. Mr. Chawla also added that he expects some improvement in the revenue. An analyst at a Mumbai brokerage, who did not want to be identified, said TV18’s “staff costs are high year by year and quarter by quarter but stil they managed their overall costs well.
First Case Going To Be Set By CBI against CWG
The Central Bureau of Investigation is set to register its first case to corruption allegations in the Common Wealth Games 2010. They said “we are verifying the papers received from the organizing committee(OC) and have gathered some evidence”. There is delay in the registration of an FIR (first information report) in the case. It is alleged that proper procedures were not followed and the firms were hired at exorbitant prices. CBI chief said “we are verifying the complaints. We will take action after others get over. But the focus of the investigation is largely on the work undertaken by the OC.
WHY SHOULDN’T HERO HONDA HAVE SOME FUN
Advertisements for mobile phones and services dominate the ratings for September,with 4 ads for telecom,featuring in the top 10 of the ad reach index,a measure of awareness and brand recall.But HERO HONDA is on the top in the race with an ad for its PLEASURE scooter,targeted at women.Hero Honda has the ad clocks 67 on the reach index.One of only 2 ads that breach the mark of 60 on the index for September while 8 ads had scored 60 or above on this index in august,including 4 that scored 70-plus.Food brands also did well in august,with 4 ads in top 10,but there is only 1 such ad in September-for Maggi vegetable Noodles.The Mint-Synovate-TVAd index survey covered 722 respondents from high income groups in Delhi,Mumbai,Bangalore.
STERLITE INDUSTRIES RESULTS DISAPPOINT
Sterlite announced lower than estimate financialresults for the quarter ended sep. the company’s operating income declined by 1% from the previous year to Rs.6,084 crores.Zinc and copper business which was in declined.
Sterlite’s aluminium bisiness contributed 12% revenue which was perfomed reltively higher than zinc and copper.Analyst s expected that global aluminium prices to increase which was increased by domestic and international demand.China’s move to cut aluminium production will help prices. Sterlite managed to inpove its oveall operating profit margin by 150 basis ptsto25%.Manwhile sterlite industrie’s stock has underperformed the sensex and BSE metal index the beginning of the fiscal.
Madras high court oder for the immediate closure of the company’s copper smelting plant in Tamil nadu.The supreme court has extended the stay on the order till the second weak of December.
EARNING SURPRISE AT TECH MAHINDRA
Tech Mahindra Ltd. has ported a positive earnings surprise for the September quarter,with operating profit adjusted for one-offs rising by 32.1% quarter-on-quarter.But investors are likely to have questions about the sustainability of this growth and hence the rise in the company’s share price.
The company reported a growth in revenue, but this revenue to an Indian client for hardware and software purchases and third party services.This is essentially pass-through revenue from a customer, on which the company has earned a margin of less than 5%.
But again,even this growth is a positive, considering that revenue have been flat in the past few quarters.Demand from the company’s top client BT GROUP PLC ,continues to be sluggish.
Tech Mahindra also reported a handsome 300 basis points improvement in margins,excluding the impact of the pass-through deal. As the chart shows, Tech Mahindra shares have underperformed this year because of the weakness in the telecom IT services space. Besides, as an end-september report by Citigroup points out, “ Tech Mahindra;s organic business stills carieers higher domain (telecom) and client concentration (BT) risk.Tech Mahindra will continue to struggle in the near term. “
SANDIPAN MONDAL
SATYENDRA YADAV
SECTION H
Tayal moves court to unlock ICICI shares
The News:
Pravin kumar Tayal, promoter of the erstwhile Bank Of Rajasthan Ltd has moved the Rajasthan High court to access ICICI Bank shares worth at least Rs. 1000 crore.
The back Ground:
SEBI had frozen the demat account of Pravin Kumar Tayal and 100-odd related entities which owned Bank Of Rajasthan shares for alleged violation of regulatory norms
The Impact:
A court order in their favour would allow them to encash shares and clear liabilities to many banks.
Bharti prepay part of $7.5 bn loan
Bharti Airtel Ltd may prepay at least $1 billion (Rs.4,440 crore) of the $7 bn loan it took from banks to funds its acquisition of the African assets of Kuwait-based Zain Telecom according to a banker familiar with the development. The flexibility of prepayment has always been part of the loan agreement and Bharti has the option of prepaying based on its cash flow.
Venky’s hatches plan to buy English Football club
A Pune poultry farm and hatchery with global aspirations is set to become the country’s firsh owner of an English football club,albeit a bottom-of-the-league team.
Venkateswara Hatcheries Group, or VH group, is in advanced negotiation to acquire “Blackburn Rovers”, according to the both group and the club.
The group will pay 46 million pound (approx. Rs.322 crore) to buy the club, Bloomberg reports.
“Blackburn Rovers” the English Premier League (EPL) champion in 1995, currently standing fourth from bottom, having own nine points from as many matches.
Rupee gets its place on the keyboard-next to the dollar
The symbol for the Indian rupee will start appearing alongside the dollar sign $ and numeral 4 on computer keyboard by the middle of next year.
“It has been decided to place the rupee symbol on the right side of the 4 numeral key, where the dollar sign is also there”,said N.Ravi Shankar, joint secretary, depertment of information technology (DIT).
An official at leading PC manufacturer HCL Infosystem Ltd confirmed the development.
S.Rajendran chief marketing officer of another PC manufacturer, ACER India Pvt. Ltd, said the company will start putting the symbol on its keyboards one software companies such as Microsoft Crop. and other stakeholders also integrate it.
User Development Fees Increased--GHIAL
Hyderabad is set to become the most expensive airport to fly from. The user development fees is going to be increased from 1 November. The UDF has been raised by 26% and 87% for the passengers flying within country and abroad respectively. The Airport Economic Regulatory Authority(AERA) has taken this decision.GMR Hyderabad International Pvt. Ltd.(GHIAL) airport began charging Rs.350 from departing domestic passengers and Rs.907 from international passengers including taxes. AERA has consulted to the authority for taking this decision. And this decision will result in the profits of Rs.650crore for next three years. GHIAL suffered losses of Rs.120 crore in 2008-09 and Rs.109.22 crore in 2009-10.
Losses Lower Down Of Q2 By IBN18, TV18
Network 18 Media and Investment Ltd’s subsidiary IBN18 Broadcast Ltd narrowed its second quarter loss to Rs.13 crore from Rs.82 crore in the same period a year earlier. IBN18’s revenue increased 39% in the threemonths to end September, boosted mainly by Viacom 18, which runs channels such as Colors, Nick and VH1. Haresh Chawla, group chief executive, Network 18, said the company’s losses were minimized because of investments that came through in phases for all its brands. Mr. Chawla also added that he expects some improvement in the revenue. An analyst at a Mumbai brokerage, who did not want to be identified, said TV18’s “staff costs are high year by year and quarter by quarter but stil they managed their overall costs well.
First Case Going To Be Set By CBI against CWG
The Central Bureau of Investigation is set to register its first case to corruption allegations in the Common Wealth Games 2010. They said “we are verifying the papers received from the organizing committee(OC) and have gathered some evidence”. There is delay in the registration of an FIR (first information report) in the case. It is alleged that proper procedures were not followed and the firms were hired at exorbitant prices. CBI chief said “we are verifying the complaints. We will take action after others get over. But the focus of the investigation is largely on the work undertaken by the OC.
WHY SHOULDN’T HERO HONDA HAVE SOME FUN
Advertisements for mobile phones and services dominate the ratings for September,with 4 ads for telecom,featuring in the top 10 of the ad reach index,a measure of awareness and brand recall.But HERO HONDA is on the top in the race with an ad for its PLEASURE scooter,targeted at women.Hero Honda has the ad clocks 67 on the reach index.One of only 2 ads that breach the mark of 60 on the index for September while 8 ads had scored 60 or above on this index in august,including 4 that scored 70-plus.Food brands also did well in august,with 4 ads in top 10,but there is only 1 such ad in September-for Maggi vegetable Noodles.The Mint-Synovate-TVAd index survey covered 722 respondents from high income groups in Delhi,Mumbai,Bangalore.
STERLITE INDUSTRIES RESULTS DISAPPOINT
Sterlite announced lower than estimate financialresults for the quarter ended sep. the company’s operating income declined by 1% from the previous year to Rs.6,084 crores.Zinc and copper business which was in declined.
Sterlite’s aluminium bisiness contributed 12% revenue which was perfomed reltively higher than zinc and copper.Analyst s expected that global aluminium prices to increase which was increased by domestic and international demand.China’s move to cut aluminium production will help prices. Sterlite managed to inpove its oveall operating profit margin by 150 basis ptsto25%.Manwhile sterlite industrie’s stock has underperformed the sensex and BSE metal index the beginning of the fiscal.
Madras high court oder for the immediate closure of the company’s copper smelting plant in Tamil nadu.The supreme court has extended the stay on the order till the second weak of December.
EARNING SURPRISE AT TECH MAHINDRA
Tech Mahindra Ltd. has ported a positive earnings surprise for the September quarter,with operating profit adjusted for one-offs rising by 32.1% quarter-on-quarter.But investors are likely to have questions about the sustainability of this growth and hence the rise in the company’s share price.
The company reported a growth in revenue, but this revenue to an Indian client for hardware and software purchases and third party services.This is essentially pass-through revenue from a customer, on which the company has earned a margin of less than 5%.
But again,even this growth is a positive, considering that revenue have been flat in the past few quarters.Demand from the company’s top client BT GROUP PLC ,continues to be sluggish.
Tech Mahindra also reported a handsome 300 basis points improvement in margins,excluding the impact of the pass-through deal. As the chart shows, Tech Mahindra shares have underperformed this year because of the weakness in the telecom IT services space. Besides, as an end-september report by Citigroup points out, “ Tech Mahindra;s organic business stills carieers higher domain (telecom) and client concentration (BT) risk.Tech Mahindra will continue to struggle in the near term. “
27th October - The Financial Express
Rohit Mathur
Rovin Shrivastava
Multi-Brand retail FDI could start off with 51%
The prime minister office (PMO) has given the indication that they now agree to allow Foriegn Direct Invesment(FDI) up to 51% in multibrand retailing.
Previously the move was opposed by peoples and they raised concerns about the future of the kirana owners
The planning commission,Department of consumer affairs,commerce and industry ministry and agricultural ministry seems to be supporting the move.
And it will be further strengthened during the visit of US president Barack Obama in November.
Government has added some conditions to make sure that the benifits of small retailers and kirana shop owners are not demolished.
Initially only those retailers will be allowed to enter the indian markets who first invest in supply chain and other related backend infrastructure.
The firms must create jobs in india in rural areas.
The consumer affairs ministry has proposed that FDI should be allowed up to 49% and of that 75% should be spent on logistics,infrastructure and technology upgrade.
SEBI to tighten disclosure norms for business between related companies.
SEBI chief CB Bhave said that the disclosure norms for transactions between related companies could be tighten.
Because there is a possibility of avoiding or reducing tax liabilties by the by doctoring the value of the transaction between related parties and enterprises.
The norms would enable the revenue authorities to collect direct and indirect taxes.
Bharti Wal-Mart to rope in 35000 farmers by 2015
Currently Bharti Wal-Mart in a 50:50 cash and carry joint venture,is working with 550 farmers in India.
But to scale up sourcing of agricultural product from India it has announced that by 2015 it will engage 35000 farmers with it.
It will be training farmers on how to utilise the resources.
, it is also planning to open the skill centres across india to train 40000 students in next five years on the skill upgradation.
'Difficult to tame inflationat ideal 4-5% level'
Finance minister Pranab Mukherjee said that it is difficult to pull the inflation down to 4-5 level.
He said that annual inflation is likely to be around 6%.
RBI ,as part of its monetary review, has increased the CRR(cash reserve ratio) to tighten the liquidity.
Finance ministry urged the central bank to esure that monetary tightening should not choke growth.
Finance minister attributed inflation with rising food prices and said that it has come down to single digit in terms of consumer price indices.
Earlier the WPI based inflation stood at 8.62% in September while food price inflation was at 15.53%
Pranab pegs growth at 8.25%-8.75%;fiscal deficit target on track
Finance Minister Pranab mukherjee said that because of the rising consumption and demand the economy is expected to grow at 8.25%-8.75%.
He also said that it will be soon around 9% level.
He said that gross tax revenue has grown by 27.3% which is the fundamentals of he economy.
CBEC chairman V Sridhar said the goverment expects toexceed the budget target for customs and excise collections in this fiscal.
Total indirect collection would be Rs. 3.3 lacs crore as against the budgeted Rs. 3.15 lacs crore.
Government aims to reduce the fiscal deficit to 4.8% in 2011-2012 and further down to 4.1 % in 2012-2013.
The growth trajectory is 8.8% in the first quarter of the current fiscal year.
The exports,manufacturing sectors and corporate earnings are picking up.
UK GDP rises 0.8% in Q3, beats forecast
Economy of Britain grew 0.8% in the third quarter which is twice as economist forecast. GDP had seen arise 1.2% in previous quarter. Economist forecast a 0.4% gain.source Bloombergnews survey.
As the economy grew Peter Dixion, an economist at commerzbank AG in London said that, The UK will grow, but the question is will it grow sufficientlynto generate jobs?
According to statistics office the GDP result is the second fastest growth reading since Q1,2007.
Finance minister George Osborne said it's an “incredible opportunity for new start-ups to flourish, for innovation to drive growth and creat jobs.
Rovin Shrivastava
Multi-Brand retail FDI could start off with 51%
The prime minister office (PMO) has given the indication that they now agree to allow Foriegn Direct Invesment(FDI) up to 51% in multibrand retailing.
Previously the move was opposed by peoples and they raised concerns about the future of the kirana owners
The planning commission,Department of consumer affairs,commerce and industry ministry and agricultural ministry seems to be supporting the move.
And it will be further strengthened during the visit of US president Barack Obama in November.
Government has added some conditions to make sure that the benifits of small retailers and kirana shop owners are not demolished.
Initially only those retailers will be allowed to enter the indian markets who first invest in supply chain and other related backend infrastructure.
The firms must create jobs in india in rural areas.
The consumer affairs ministry has proposed that FDI should be allowed up to 49% and of that 75% should be spent on logistics,infrastructure and technology upgrade.
SEBI to tighten disclosure norms for business between related companies.
SEBI chief CB Bhave said that the disclosure norms for transactions between related companies could be tighten.
Because there is a possibility of avoiding or reducing tax liabilties by the by doctoring the value of the transaction between related parties and enterprises.
The norms would enable the revenue authorities to collect direct and indirect taxes.
Bharti Wal-Mart to rope in 35000 farmers by 2015
Currently Bharti Wal-Mart in a 50:50 cash and carry joint venture,is working with 550 farmers in India.
But to scale up sourcing of agricultural product from India it has announced that by 2015 it will engage 35000 farmers with it.
It will be training farmers on how to utilise the resources.
, it is also planning to open the skill centres across india to train 40000 students in next five years on the skill upgradation.
'Difficult to tame inflationat ideal 4-5% level'
Finance minister Pranab Mukherjee said that it is difficult to pull the inflation down to 4-5 level.
He said that annual inflation is likely to be around 6%.
RBI ,as part of its monetary review, has increased the CRR(cash reserve ratio) to tighten the liquidity.
Finance ministry urged the central bank to esure that monetary tightening should not choke growth.
Finance minister attributed inflation with rising food prices and said that it has come down to single digit in terms of consumer price indices.
Earlier the WPI based inflation stood at 8.62% in September while food price inflation was at 15.53%
Pranab pegs growth at 8.25%-8.75%;fiscal deficit target on track
Finance Minister Pranab mukherjee said that because of the rising consumption and demand the economy is expected to grow at 8.25%-8.75%.
He also said that it will be soon around 9% level.
He said that gross tax revenue has grown by 27.3% which is the fundamentals of he economy.
CBEC chairman V Sridhar said the goverment expects toexceed the budget target for customs and excise collections in this fiscal.
Total indirect collection would be Rs. 3.3 lacs crore as against the budgeted Rs. 3.15 lacs crore.
Government aims to reduce the fiscal deficit to 4.8% in 2011-2012 and further down to 4.1 % in 2012-2013.
The growth trajectory is 8.8% in the first quarter of the current fiscal year.
The exports,manufacturing sectors and corporate earnings are picking up.
UK GDP rises 0.8% in Q3, beats forecast
Economy of Britain grew 0.8% in the third quarter which is twice as economist forecast. GDP had seen arise 1.2% in previous quarter. Economist forecast a 0.4% gain.source Bloombergnews survey.
As the economy grew Peter Dixion, an economist at commerzbank AG in London said that, The UK will grow, but the question is will it grow sufficientlynto generate jobs?
According to statistics office the GDP result is the second fastest growth reading since Q1,2007.
Finance minister George Osborne said it's an “incredible opportunity for new start-ups to flourish, for innovation to drive growth and creat jobs.
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