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Global hiccup, claims FM
Fed rate cut to benefit exports: Nath
Infosys fines its own CEO
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Spice to invest $1 billion
Industry pitches for rate cut
Slowdown in world economy inevitable: IMF
TRAI norms for mobile TV
Commerce ministry may pare export sops
REL bags DMRC project
Oil prices lower in Asian trade
Gold surges by Rs 340
Higher prices of milk powder hit exports
SBoP revises interest rates
Rs 500-cr corpus mooted
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Global hiccup, claims FM
London, January 23 "The Indian market is only reacting to what is happening worldwide especially the US market and the East Asian markets," Chidambaram told newsmen after inaugurating the London branch of the General Insurance Corporation of India here this morning. He said "there is nothing fundamentally wrong with the Indian economy. The results of major corporate houses coming in the third quarters show the profits are rising. That is reflected in an increase in corporate taxes and income taxes." Indian stock market has suffered an unprecedented loss in the last seven days. It has tumbled by 4,097.51 points since January 14 due to weak cues from the US and other global markets. However, today it gained 864.13 points to close at 17,594.07, boosted by a rate cut by the US Federal Reserve. Advising long-term investors to stay calm, Chidambaram said that "it has happened in the past and it may happen in the future". He said "India continues to be a very attractive market in terms of high returns, and foreign direct investment would continue to come." "There are countries with huge deficit and there are countries with fixed exchange rates. Some might face problems as financial situation continues to be volatile." On rupee appreciation, the minister said "I know in some sectors it is causing problems. We are taking steps to help them and we will continue to take steps to lessen the pain. But in the long term, an open economy will allow capital inflow and
outflow." — PTI |
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US recession fears reign WEF meet
Davos, January 23 "The US is heading towards recession. But it may not have that much an impact because of a shift in growth momentum towards India, China and East Asian countries," Kamal Nath said while participating in a panel discussion here this morning. Ruling out any major impact on India of a slowdown in the US economy, he said even though the US is India's major trading partner, growth in the south Asian nation is mainly dependent on domestic demand. Trade growth with China and other European countries was also growing, Nath added. Participating in the discussion on issues likely to dominate the global economy over the next 18 months, World Bank managing director Ngozi Okonjo Iweala said apart from possible US recession, which will have its impact on Europe and other economies, rising food and energy prices would be an issue to contend with. Moderating the first session of economists, Time Magazine' editor Michael Elliot said, "strong euro is affecting negatively not just Greece, but also countries like France and Germany in Europe. There are housing bubbles now in Europe as well as in the UK and Spain. That is another threat for the global growth." —
PTI
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Fed rate cut to benefit exports: Nath
Davos: Commerce and industry minister Kamal Nath has said a hefty cut in the US interest rates will have a positive impact for the Indian exports, but industry leader Rahul Bajaj felt the move will further hit exporters.
"The US Fed's decision would rather boost Indian exports to America as it would raise demand in the biggest economy of the world," Nath said at the World Economic Forum annual meet here. He said the US rate cut would not affect the Indian economy, which has strong fundamentals. However, industry leader and Rajya Sabha Member Rahul Bajaj said that the US Federal Reserve's decision to cut interest rates could adversely affect Indian exports as rupee would further appreciate against dollar due to increase in flow of foreign investment in stock market. — PTI |
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New Delhi, January 23 The Audit Committee of Infosys Technologies' board of directors has imposed a penalty of Rs 5 lakh on Gopalakrishnan and a fine of $2,000 on Lehman as they failed to comply with the insider trading norms of the company, Infosys said in a notice to the US Securities and Exchange Commission (USSEC). According to the Insider Trading Rules, a director, officer or other designated employees of the firm may buy or sell its securities only after prior notification and must notify within one business day following any change in his or her shareholding, it added. On December 24, 2007, Gopalakrishnan, CEO and MD of Infosys Technologies, inherited 12,800 equity shares from his mother. However, he failed to notify the company within one business day following the change in his shareholding, which led to the imposition of Rs 5 lakh penalty. Gopalakrishnan was directed to donate the amount to a charitable organisation of his choice and he has made the donation as directed by the company's audit committee.—
PTI |
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Spice to invest $1 billion
New Delhi, January 23 The company had recently received letters of intent (LoIs) for starting mobile services in four circles — Delhi, Haryana, Andhra Pradesh and Maharashtra. It already operates in Punjab and Karnataka circles. "We will invest $1 billion in four new circles and we expect to roll out our services in the first half of this year," Spice Group chairman B K Modi said. Spice is targeting a market share of 10 per cent in the first two years of operations, he said. The company's board meeting will be held tomorrow in Singapore. It has also lined up a $3-billion investment for pan-India operations. — PTI |
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Industry pitches for rate cut
New Delhi, January 23 “The US Fed cut is a signal for the soft interest rate regime globally. The RBI should follow the cue and cut interest rates to support the economic growth. The RBI must cut repo rate by at least 25 basis points this month itself and then follow up with further cut of another 25 basis points within next two months,” Ficci president Habil Khorakhiwala said. “Now that the inflation is down to tolerable limits, we do hope that the RBI would re-look at the interest rates and some measures would be taken to move towards a soft interest rate regime,” he added. CII president Sunil Bharti Mittal said there is an urgent need to cut interest rates to strengthen macro economic fundamentals of the Indian economy in an increasingly uncertain global economic environment and the US Federal Reserve rate cut by 75 basis points. “With inflation under control and hovering around 3 per cent, it is the right time for the RBI to cut repo and reverse repo rates that are currently at 7.75 per cent and 6 per cent respectively to cover the relative competitive disadvantage India is currently in on macro economic fundamentals. This move would strengthen the economic fundamentals and also boost investors’ confidence,” CII president said.
The chamber has suggested that the RBI should relax the norms relating to lending to the market intermediaries to avoid liquidity crunch. Meanwhile, India economist with Lehman Brothers Sonal Verma told The Tribune over phone from Mumbai that inflationary pressure might weigh high on the RBI. “I don’t think the RBI will go for a rate cut. Thought the gap between the US Fed rate and Indian rate has widened, it is not a sufficient ground for the RBI to go for a rate cut,” Verma said. |
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Slowdown in world economy inevitable: IMF
Washington, January 23 "A significant 2008 slowing in the global expansion already appears inevitable, and downside risks still predominate," Masood Ahmed, director of external relations of the fund, said in a statement. "The United States has been most affected by recent economic and financial developments. Thus, today's 75-basis point reduction in the Federal funds rate was appropriate and helpful," he said. With global markets experiencing a meltdown amid fears of a US recession, the Federal Reserve had yesterday cut its key short-term interest rate by 75 basis points in a move aimed at steadying the world's biggest economy. Ahmed asked the Federal Reserve to apply targeted and timely fiscal measures to boost near-term demand. In addition, targeted and timely fiscal measures could provide near-term support for demand," he added. —
PTI |
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TRAI norms for mobile TV
New Delhi, January 23 The telecom regulator has also recommended that the creation of a new class of service providers for provision of mobile television service using broadcasting technologies. It also recommended that telecom operator with cellular mobile telephone service license and unified access service license will not require any further license or permission for offering mobile television services on their own network using the frequency or spectrum already allotted to them. However, providing mobile television services through the broadcasting method will require a separate license. TRAI has also recommended that the license fees for mobile television services should be granted through a closed tender system on the basis of one-time entry fees (OTEF) quoted by the TRAI has fixed the limit of 74 per cent of foreign direct investment for mobile television services and has fixed the tenure of the licence for 10 years. The licence fee should be charged at 4 per cent of the gross revenue for each year or at 10 per cent of the OTEF limit for the concerned licence area, whichever was higher. It has also directed a mobile television licensee to not allow any broadcasting company or group of broadcasting companies to collectively hold or own more than 20 per cent of the total paid up equity in its company at any time during the license period. |
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Commerce ministry may pare export sops
New Delhi, January 23 "Schemes that offer marginal or no benefit to exporters would be done away with. We need to think out-of-the-box and have a more efficient policy," G K Pillai, commerce secretary said. The commerce ministry is also seriously considering simplifying export procedures, said Pillai at a meeting on Foreign Trade Policy and Trade Issues organised by the Confederation of Indian Industry here. On export targets, he said the country would miss the target by about $10 billion because of slow growth in some sectors. “We had set an export target of $160 billion for 2007-08. We are hopeful of touching $155 billion and confident of achieving $150 billion exports this fiscal,” Pillai said. Pillai said the Krishnamurthy Committee would submit its recommendations to arrest the slowdown in exports from labour-intensive sectors. The committee will submit its report by January 31 and suggest measures to deal with the impact of appreciating rupee on exports. On India-Asean free trade agreement, the commerce Secretary said the negotiations are on tract and the agreement is likely to be finalised by March 2008 and operational from January 2009.
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REL bags DMRC project
New Delhi, January 23 The consortium will have to install all systems, including rolling stock, overhead electrification, track, signaling and telecommunication, ventilation and air-conditioning, automatic fare collection, baggage check-in and handling, depot and other facilities, while DMRC would do the civil work for the project. — UNI |
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Oil prices lower in Asian trade
Singapore, January 23 In afternoon trade, New York's main contract, light sweet crude for delivery in March, was down 51 cents to $88.70 a barrel after gaining eight cents earlier. The February contract, which expired yesterday, had closed 72 cents lower at $89.85 in New York. Brent North Sea crude for March delivery continued lower, dropping 50 cents to $87.95 a barrel. The contract was down by a cent in morning trade. — AFP |
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Gold surges by Rs 340
New Delhi, January 23 Trading sentiment turned bullish after dollar slumped against the euro following an interest rate cut by the US Federal Reserve. Marketmen said frantic buying by stockists and jewellery fabricators in line with surging trend in Asian markets mainly boosted the trade sentiment. The gold in Asia rose to $893.55 an ounce, 2.3 per cent below its highest ever level of $914.30 reached on January 14. Silver also traded better at $15.95 an ounce. Standard gold and ornaments rose by Rs 340 each at Rs 11,510 and Rs 11,360 respectively. Sovereign also shot up by Rs 100 at Rs 9150 per piece of eight gram.—
PTI |
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Higher prices of milk powder hit exports
Chandigarh, January 23 As compared to the international price of Rs 120 per kg of skimmed milk powder (SMP), the price in the domestic market is Rs 130 per kg. Despite increase in production of milk powder in the state and at least four new SMP plants being set up, exports have not yet picked up. Industry sources said though they had been receiving a lot of inquiries for export, they were not being offered prevailing market prices. This is despite the fact that there is a global scarcity of milk powder in Europe because of drought in New Zealand and Australia - who have been supplying SMP to European countries. It may be noted that the milk production in Punjab has increased substantially this year. With a poor milk production for two consecutive years, the Government of India had imposed a ban on export of SMP. The ban was lifted in October 2007 and private dairy plants as well as state-run milk cooperative- Milkfed - went in a big way for the production of SMP, mainly for the purpose of exports. Vinod Dutt, managing director, Hygienic Foods, Khanna, said seeing a huge potential in the SMP segment, his company increased the production by five tons a day. “But with the falling rupee, we are not able to get a good price through exports. A number of other dairy units, too, started going in for its commercial production this year,” he said. Milkfed had increased its production of milk powder to about 1,500 tons till date this year, and is hoping to produce 4,500 tons by March. V K Singh, managing director, Milkfed, said though they had managed to export some quantity of SMP to West Asia, they were not finding enough buyers in the international market. |
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SBoP revises interest rates
Patiala, January 23 For the senior citizens, additional interest at the rate of 0.50 per cent will be be given at the time of maturity. |
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Non-major Ports
New Delhi, January 23 The proposal is in line with the ministry’s effort to not only encourage non-major ports to collaborate with major ports, but also develop infrastructure in 200-odd non-major ports in the country. “The proposal in the form of a pre-budget memorandum has already be sent to the ministry of finance for consideration,” Rakesh Shrivastava, joint secretary (ports) in the ministry of shipping, told The Tribune on the sidelines of a CII-organised function on foreign trade policy here. Of the total cargo movement, only 30 per cent are at present handled by non-major ports due to poor rail and road linkages or due to lack of collaboration with major ports. All the ports put together, there was a cargo movement of 704 million tonnes as on March 2007 and the government has set an ambitious target of taking this cargo movement to 2 billion tonnes by 2012, Shrivastava said. “Our target is to ensure that by 2012, non-major ports handle 50 per cent of the cargo movement, i.e. 1 billion tonnes,” he said, adding the Rs 500 crore proposal is the first step to make non-major ports viable. For operational reasons and convenient implementation of the scheme, the shipping ministry has proposed to route the money from the corpus to state maritime boards, he added. |
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