L A T E S T      N E W S

Slash subsidy, raise prices of diesel and LPG: Economic Survey
Economy to grow at 6.1-6.7 pc in 2013-14

NEW DELHI: Claiming that the "downturn is more or less over", the pre-Budget Economic Survey on Wednesday projected an optimistic 6.1 to 6.7 per cent growth in the next fiscal and made a strong call for cutting subsidises.

While pegging the GDP growth at an estimated 5 per cent for the current fiscal, the Survey tabled in Parliament by finance minister P Chidambaram said "...the overall economy is expected to grow in the range of 6.1 to 6.7 per cent in 2013-14" as the economy is looking up.

"Controlling the expenditure on subsidies will be crucial. The domestic prices of petroleum products, particularly diesel and LPG need to be raised in line with their prices prevailing in the international market," the Survey said.

It noted that a beginning has already been made with the decision in September last to raise the price of diesel and again in January to allow oil marketing companies to increase prices in small increments at regular intervals. The number of subsidised gas cylinders has also been capped at 9 per household.

Predicting that the headline inflation will decline to between 6.2 and 6.6 per cent by next month, the Survey said that elevated food inflation would continue to remain an area of concern as it inched towards double digit in December 2012.

The Survey emphasised that efforts will have to be made to contain subsidies through better targeting and for reducing leakages involved in their delivery. One such initiative is direct benefit transfer (DBT) scheme.

It said the government has been calibrating pricing policies to addressing the issue of burgeoning fertiliser subsidy and underlined the need for according priority to food subsidy in view of the under consumption of basic food by the poor and the extant of malnutrition.

Under-recoveries of oil marketing companies (OMCs) were estimated at Rs 1.24 lakh crore in April-December of 2012-13.

The Survey said high level of global crude oil prices also has a bearing on fertiliser subsidy as as there is inadequate pass-through in urea prices (a major domestic fertiliser).

The government has been calibrating pricing policies to address the issue of burgeoning fertiliser subsidies, like fixing the per tonne subsidy on key non-nitrogenous phosphatic and potassic (P&K) fertilisers.

The survey said food subsidy has been growing at an average annual rate of 25.4 per cent in the last five years, of which the bulk is accounted by the targeted public distribution system (TPDS).

"In terms of the merits of subsidisation, priority needs to be accorded to food subsidy in view of the under consumption of basic food by the poor and the extent of malnutrition in the country," it added.

It stressed the need for better targeting of subsidies and for reducing leakages involved in their delivery and the direct cash transfer is one such initiative. 

Highlights

* GDP growth to remain between 6.1 per cent to 6.7 per cent in 2013-14

* WPI inflation to moderate in the range of 6.2 per cent to 6.6 per cent

* Economy estimated to grow at 5 per cent in 2012-13 after growing by 6.2 per cent in previous year

* Poor show of services sector contributed significantly to slowdown

* Global as well as domestic factors responsible for slowdown

* FDI in retail can pave the way for investment in new technology and marketing of agricultural produce

* The survey has a special chapter focused on jobs

* Fast agricultural growth remains vital for jobs, incomes and food security 

(PTI and IANS)

Accountability must for rights violations in Sri Lanka: Govt

NEW DELHI: In the wake of fresh allegations of rights violations against ethnic Tamils in Sri Lanka, India on Wednesday said there should be accountability for such issues but remained evasive on the position it will take at the UN on a resolution against that country.

External affairs minister Salman Khurshid made it clear that India would not intervene directly in Sri Lanka's sovereign affairs even as members in the Rajya Sabha expressed serious concern over the situation there and demanded an independent credible probe into the killing of LTTE chief Prabhakaran's 12-year-old son Balachandran.

DMK, a key UPA constituent, said it has lost faith in the government on this and its members staged a walkout along with those from AIADMK and Left, dissatisfied with Khurshid's reply to the debate on the plight of Tamils in Sri Lanka.

"We are totally and utterly committed to the outcome that must ensure equality, dignity, justice for the Tamil people of Sri Lanka," Khurshid said, sharing concerns expressed by members cutting across party lines.

On the recent allegation about Balachandran being killed in cold blood by the Sri Lankan forces, he said India cannot "adjudicate" about the truth behind the incident and apportion the responsibility on anybody for the "very moving, very tragic, very sad" incident.

"That is why we are engaging with Sri Lanka... Accountability should be there...Whether it should be imposed from outside or come from within... Honestly speaking, accountability is necessary, accountability is inevitable but accountability must come from within," the minister said.

"There is no future unless there is reconciliation, there is no future unless there is accountability," he said but added that India cannot impose a timeline on Sri Lanka for it.

Responding to demands by members that India should vote with the US resolution in the UN against Sri Lanka on it, he said, "What point we make in the UN can't foreclose today. We will make position keeping this debate in mind. After taking position we will disclose here...". — PTI

18 die in Kolkata market fire

KOLKATA: A major fire engulfed a godown-cum-office complex in a market in Sealdah early on Wednesday, leaving 18 perrsons dead and several others injured.

Joint Commissioner of Police (Headquarters) Javed Shamim said the dead included a woman. 15 persons have far been rescued from the inferno.

The fire was detected at 3.50am when the victims were fast asleep, the police said.

The injured were rushed to state-run NRS and Medical College hospitals.

Fire services minister Javed Khan told that six persons were brought out from the burning godown in an unconscious state by the firemen, who were trying to find if others were trapped inside.

He said 26 fire tenders fought the blaze for over three hours to bring the situation under control.

Firemen and police personnel cordoned off the area to facilitate fire fighting operations.

The cause of the fire and the extent of damage were under investigation, police said.

Khan, who rushed to the spot and personally supervised fire fighting operations, said there was no fire safety arrangement in the market and blamed the market authorities for the lapse.

"We will take action against the market authorities for not having any fire safety arrangement", the minister said.

To a question, he said the entire building housing the market was unauthorised and illegal and had come up during the previous Left Front regime. — PTI 

Hagel is new US Defence Secretary

Washington: The US Senate has confirmed the nomination of Chuck Hagel as country's new Defence Secretary by a 58-41 vote.

Hagel, a Vietnam war veteran and former Republican Senator from Nebraska, is excepted to be sworn in today. The confirmation of Hagel, 66, comes as a great relief for the Obama Administration as his nomination was held up for weeks and the Democrats and the White House had to do a tough convincing act to get him approved by the Senate.

Several Republican Senators are said to have voted in favour of Hagel despite their reservations.

Hagel will replace incumbent Leon Panetta at a time when the department is faced with multiple challenges including defence budget cuts, rapidly changing developments in the Middle East, increasing threat from North Korea besides the scheduled withdrawal of US forces from Afghanistan in 2014. 

Hagel’s remarks against India ‘bizarre’: BJP

NEW DELHI: Terming as “outlandish and bizarre” the statement of Chuck Hagel, the new US Defence Secretary, that India has financed problems for Pakistan in Afghanistan, the Bharatiya Janata Party (BJP) on Wednesday asked the government to exert diplomatic pressure on Washington for unconditional withdrawal of his statement.

The statement given by Hagel that India has financed problems in Pakistan is “outlandish, bizarre and baseless,” BJP spokesperson Rajiv Pratap Rudy said.

He also expressed surprise over Hagel giving a clean chit to Pakistan, which has harboured in the backyard of its military base al-Qaeda chief Osama Bin Laden, who was responsible for killing of more than 5,000 Americans in the World Trade Centre attack.

“BJP is concerned at the indifference of the Indian government by not reacting to Hagel. BJP demands that the Government of India uses its diplomatic pressure to see that Chuck Hagel retracts his statement unconditionally,” Rudy said.

Hagel had made the remarks during a speech at Oklahoma’s Cameron University in 2011, which has surfaced now.

“India for some time has always used Afghanistan as a second front, and India has over the years financed problems for Pakistan on that side of the border,” the former Republican Senator had said.

His remarks are considered in sharp contrast to viewpoint of the Obama Administration that has always been in praise of India’s developmental role in Afghanistan and in fact has been pressing New Delhi to do more in Afghanistan. — PTI