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Rising
rupee prompts exporters to meet Jaitley He, in turn, will meet Jaswant ‘Telecom
barriers exist in India’ Finance
Ministry pegs GDP rate at 8.1 pc |
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BT
cotton yields good returns in China HP tea
industry feels the heat Accumulated
losses may hit investment
in cellphone industry ICRA,
Bangladesh rating agency join hands Graphic: WHOLESALE PRICE INDEX FOR THE WEEK ENDING MARCH 27, 2004
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Rising rupee prompts exporters to meet Jaitley New Delhi, April 9 A delegation headed by Mr M. Rafeeque Ahmed, president, Federation of Indian Export Organisations
(FIEO), met him and apprised him of the exporters’ problems. Mr Ahmed argued that due to rupee appreciation, exporters were feeling the pinch and apprehended they might lose established markets if the government fails to take corrective steps. He said: “The rupee value against dollar has appreciated over 8 per cent during last one year, hitting them hard. The rupee value has increased sharply during last 10 days.” The textile and commodity exporters were the worst sufferers with lower import content. They had not gained from the fall in import prices. On the other hand, sectors like jewellery with higher import content were not affected much, he said. He said the exporters were reluctant to sign new contracts with buyers due to volatility in the foreign exchange markets. “The value of rupee against dollar has substantially increased affecting the profit margins. Consequently, they are finding it difficult even to meet their previous orders.” FIEO vice-president Subhash Mittal said record hike in export growth in the last few months should not lead to a complacent situation since the impact of rupee appreciation would start showing the next year. “The impact of rupee appreciation or depreciation is generally visible after 18 months,” he said. He wondered how could India sustain its export growth while competing with China, that had “artificially fixed its exchange rate” against dollar. Exporters sought cut in interest rate to 2.5 per cent against 7 per cent at present and asked reduction in transaction costs.
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He, in turn, will meet
Jaswant
New Delhi: In a bid to provide some relief to exporters, hit hard by sharp appreciation in rupee, Commerce Minister Arun Jaitley will meet Finance Minister Jaswant Singh early next week and seek tax sops, including restoration of income tax exemption. The two ministers are expected to meet on Monday, government sources said.
— PTI
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‘Telecom barriers exist in India’
Washington, April 9 “Among the barriers identified this year are restrictions in India, Germany, Switzerland and Singapore,” he said. TRAI intervened to help ensure that access to submarine cable capacity was provided by VSNL, the review noted. “This intervention was a short-term solution to a chronic problem of reasonable and non-discriminatory access to such capacity; without a long-term solution, service suppliers may experience further constraints on their ability to access such capacity to provide their services.” The review “identifies barriers that hurt American businesses and workers and undercut economic reform efforts around the world,” Mr Zoellick said. The global telecommunications services and equipment market is pegged at $ 1.3 trillion. The US will negotiate and adopt strong disciplines in Free Trade Agreements and the World Trade Organisation to eliminate or prevent the emergence of “trade distorting barriers.” India, says the report, “was cited for inadequately ensuring access to submarine cable capacity”. “These complaints relate to obligations undertaken in the General Agreement on Trade in Services (GATS) Telecommunications Annex requiring that WTO members, where they have specific service commitments, ensure that access to and use of public telecommunications networks and services, including leased lines, be provided on reasonable and non-discriminatory terms and conditions.” Under the heading, “Country-Specific Background: India,” it says “this year USTR received formal complaints regarding a long-standing problem in India, India’s tolerance of actions by its dominant international carrier, VSNL, limiting access to and use of submarine cable capacity it controls through its cable landing station”. “Recently, under threat of regulatory interventions, VSNL has reportedly agreed to activate some of the circuits under dispute, freeing up capacity to meet some of the demand. However, in the absence of clear rules (e.g. on pricing and provisioning), ensuring reasonable and non-discriminatory access to submarine cable capacity on a long-term basis remains problematic,” it says. The report further charged that VSNL has no incentive to allow competitors (whose cable terminates at VSNL’s landing station) to freely activate and market that capacity in India when it could keep prices (and market share) for its own services higher by limiting competitors’ access to additional capacity. “The USTR will continue to closely monitor this situation and encourage India’s regulator to introduce long-term rules to prevent similar disputes from arising in the future,” it added.
— PTI
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Finance Ministry pegs GDP rate at 8.1 pc New Delhi, April 9 In the third quarterly economic review, as mandatory under the Fiscal Responsibility and Budget Management Act, the ministry said the 8.1 per cent growth “bears testimony to the emerging fundamental strength and resilience of the economy”. The review said foodgrains production this year is likely to cross the previous peak performance of 212.02 million tonnes. Moreover, the production of deficit crops such as pulses and oilseeds has increased significantly and oilseeds production is expected to touch a record level of 24.9 million tonnes. The economic growth recorded in the second quarter at 8.4 per cent is an all-time high. In April-December, 2003, exports grew 13.5 per cent in dollar terms, a rate lower than 18.1 per cent achieved in the same period last year. Imports in the first three quarters in dollar terms increased by 24.9 per cent as against 15.1 per cent recorded in the previous year. Foreign exchange reserves, including gold and SDRs, have touched an all-time high of $101.8 billion at the end of December, 2003. The growth of foreign exchange reserves by around $25 billion in the current year and by about $10 billion in the third quarter “indicates the inherent strength of India’s balance of payments.” The fiscal deficit in April-December, 2003, is estimated at Rs 92,435 crore compared to Rs 86,269 crore during the same period of the previous year. Non-food credit growth, a critical parameter indicating economic performance, has increased in the third quarter and was 42 per cent more when compared to the corresponding period of 2002-03. Regarding the upswing of the capital markets, the quarterly review said it is primarily because of good corporate results and also due to sustained inflow of foreign investment. “A combination of moderate inflation, capital inflows, continuing soft interest rates, good corporate performance and healthy capital markets augur well for the prospects of the economy,” it said. Gross tax collection of Rs 1,64,170 crore up to December, 2003, was 12 per cent higher than the previous year’s figure of Rs 1,46,192 crore. Direct taxes increased by 30 per cent while indirect taxes clocked a growth of 9 per cent.
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BT cotton yields good returns in China New Delhi, April 9 Besides other crops, the BT cotton, the genetically modified crop promoted by Monsanto and Chinese Academy of Agricultural Sciences, has proved a great success. Mr Derek Russell, Technical Manager, Natural Resource Institute, the UK, in a study “Farmer experience with BT cotton in China” has claimed that about 2.1 million hectares under cotton, has already shifted to BT cotton in China. This has resulted in control of American Bollworm, fall in use of pesticides and a rise in farm income up to $ 107 per hectare. He disclosed although China had only 4 per cent of the world’s transgenic cotton area, it has the largest number of small farmers involved in transgenic cotton production. Mr Russell admitted that yield differences between BT and non-BT cotton under field condition is not significant, about three tonnes of seed cotton in both cases. However, the cost of production has come down drastically for BT cotton producers, leading to a rise in profit from $ 360 to $ 600 per ha in 2002-03.
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HP tea industry feels the heat Palampur, April 9 The tea factories of the region have no raw material as no green leaves are available for processing. The continuous dry spell in the foothills of the Dhauladhar ranges which are famous for the production of “Himalayan tea”, received no rain after January. Mr Kunj Behari Lal Butail, a tea grower, says the tea industry’s problems, which is already facing marketing problems because of the WTO agreement, have been multiplied due to drought conditions. The green leaves production in the tea gardens of the valley has come down by 20 to 30 per cent this year in the absence of rain. The wheat crop has also been destroyed in the region. In Changer valley, there is a total loss to these crops. A team of journalists visited Chadhiar, Sari Molag, Jaisinghpur, Shiv Nagar yesterday and found the total loss to the crops. On the other hand, the state government is a silent spectator and most of the Ministers and MLAs are busy in electioneering and finding no time to listen to the grievances of farmers. No efforts have been made so far to provide any assistance to drought-hit tea growers of the area. The state Agriculture Department which looks after the tea industry of the region has initiated no measure to save the tea industry. Farmers said, the government should provide them foodgrains on subsidised rates. |
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The brand ambassador gamble
Mumbai, April 8 When megastar Amitabh Bachchan delivers a hit on the silver screen, it brings smiles to the Indian corporate, besides the producers and distributors of the movie. This is because the Indian corporate has roped in these famous faces to sell their products. “Its a two-way street. One way it shows the strength of the brand promotion. But it is also fraught with risk if your brand ambassador fails to perform in the related field,” says Reliance India Mobile (RIM) marketing head Kaushik Roy who have Virender Sehwag as brand ambassador. According to marketing analysts, contrary to the popular belief, many companies are shying away from associating high-profile celebrities with their products. The companies fear their brand will be overshadowed by the big names. Also, more than the big buck involved, it is the sustainability of the brand ambassador’s performance that concerns the corporate, the analysts note. Speaking to UNI, Mr Roy said, “We want to try and avoid the celebrity endorsements as much as possible. Over-dependence on them will create problems in future so we should stand on our own legs.” “The frequent switchover of the celebrities to other brands also creates headache and bad image.” According to marketing guru Jagdish Sheth, celebrity endorsements are risky as things go wrong when the brand ambassador is not in the limelight. Dr Sheth, the Charles H Kellstadt Professor of Marketing at the US-based Goizueta Business School, says a high-profile figure acts as the spokesperson of the company and can forcefully convey the message to the target audience. “But when all is not well with the brand ambassador, the endorsement gets risky. This has happened with many companies,” Dr Sheth, who is also the founder of the Centre for Relationship Marketing (CRM) at Emroy University, says.
— UNI
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Accumulated losses may hit investment in Mumbai, April 9 This apprehensive outlook was made by ICRA in spite of the fact that there was a huge growth potential of cellular operators due to low-level of telecom penetration and continued decline in the user charges, putting pressure on the profitability of the industry. In this context, ICRA report said the industry needs favourable and pre-competitive regulatory conditions in order to bring stabilising elements for the healthy growth. While so far there is no precedent for financial failure in the market, it said, more intense competition could endanger the survival of some small cellular players. This will force the industry to go for consolidation process since weaker operators may go for strategic alliances and divest equity in favour of stronger players. The report said the strong growth in cellular subscriptions is likely to be driven by lower equipment costs and increased competition, which is likely to result in continuous decline in prices and greater cellular penetration thereby fuelling further fall in costs and prices. In India, the cellular teledensity is still low at 2.5 per cent by end-March 2004.
— UNI
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ICRA, Bangladesh rating agency join hands
Kolkata, April 9 Describing the tie-up as a big leap forward towards extending the Indian expertise in terms of corporate credit rating to a foreign land, Chairpersons of both agencies — Mr O. N. Ghosh of ICRA and Mohammad Syeduzaman of CRAB — said the TCA will also go a long way in providing training to Bangladeshi analysts and for providing other assistance to CRAB for the rating of a large number of corporate houses in that country.
— UNI
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Inflation inches up to 4.47 pc L&T demerger Nabard loans Sun bonds MRPL capacity Liril Orange |
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