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Industrial growth in April down to 7 pc
Complex fertiliser prices slashed
Furnace oil boils
Much TOIL ahead |
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Another price hike likely, says Moody’s
Annual General Meeting
Plywood rates up by 7 per cent
Bajaj Allianz to pump in Rs 500 crore
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Industrial growth in April down to 7 pc
New Delhi, June 12 “We expected the IIP to be weaker as the economy is clearly slowing down. But compared to the last 3 per cent industrial growth, the 7 per cent figure gives us some reassurance that though the economic growth will slowdown but it will not be as severe as it seemed,” S&P chief economist Subir Gokarn said. The stock markets seemed charged up after the IIP data was released with the benchmark Sensex, which was down by over 400 points in morning trade, recovered to end the day higher by over 60 points at 15,250. Attributing the reason for slowdown to high interest rates and increasing input costs, CRISIL principal economist D. K. Joshi said the average industrial growth during 2008-09 was likely to be around 7 per cent. While the growth in manufacturing and electricity sectors dipped in the month, mining posted a robust growth. The electricity generation also saw a steep fall to 1.4 per cent against 8.7 per cent during the same month last year. The mining sector, however, posted an impressive show of 8.6 per cent growth, up from 2.6 per cent. According to Joshi, the sectors sensitive to interest rate movement will bear the maximum brunt. “We were expecting around 8.1 per cent economic growth but now we will have to revise our projections,” he said. With industrial production slowing down, he added, it was unlikely that the economy will record a growth rate of 8.1 per cent during the current fiscal. Coupled with a soaring inflation rate that touched a 45-month high at 8.24 per cent for the week ended May 24, the industrial performance was poorest in the consumer goods sector in the use-based classification. Consumer goods recorded a growth of 8.9 per cent against 14.7 per cent in the last year and consumer non-durables growth rate dipped to 9.8 per cent in April from 18.7 per cent during the last year. However, much to the respite of the white good industry, consumer durable segment registered a growth of 5.5 per cent during the month versus 2.4 per cent in the corresponding month the previous year. — PTI
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Complex fertiliser prices slashed
New Delhi, June 12 With this, the prices of complex fertilisers will come down by Rs 1,416 per tonne or Rs 70 per bag, finance minister P Chidambaram said. The decision to reduce prices was taken at a meeting of the Cabinet Committee on Economic Affairs, chaired by Prime Minister Manmohan Singh, amid reports that there is a supply crisis of the crucial agri-nutrient. Complex fertilisers are those which have at least two nutrients while regular fertilisers have only one nutrient like nitrogen (n), phosphorous (p) or potash (k). The decision assumes significance for the UPA government, which is banking partially on a good crop to send a positive signal in a season of economic gloom to ease the prices of food and other items. A drop in sowing could only mean continued upward move of inflation with the inherent negative outcome for the Congress in an election-packed year, says an industry source. The government has also approved uniform freight subsidy scheme for fertilisers to make them available to farmers in different areas at uniform price. The policy of freight subsidy will enable the movement of phosphate and potash fertilizers, ensuring availability and equitable distribution especially in far off places as against the earlier situation when the companies were getting freight reimbursement only for urea. The uniform freight subsidy scheme, which is based on the payment of actual freight, Chidambaram said, would ensure easier availability of fertilisers in all parts of the country. Currently, fertiliser companies receive a fixed amount as freight irrespective of distance from the production centre to the sale point. The industry for long had been demanding payment of actual freight. The finance minister ruled out that there was any shortage of fertiliser in the country saying that the ministry of fertiliser had assured us that there was adequate supply. He, however, added that the states should ensure that there were no movement bottlenecks, which could be cleared only at the local level.
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Furnace oil boils
Chandigarh, June 12 “The industry in Punjab is badly crippled due to ever rising prices of furnace oil. Steel prices have already broken all barriers and furnace oil is following suit. Since this oil is not under administrative control, as petrol, diesel and kerosene, the oil companies are arbitrarily increasing the price of furnace oil.Though diesel has been priced at Rs 34.41 per litre, furnace oil is available at Rs 38 a litre,” said P. D. Sharma, president, Apex Chamber of Commerce and Industry. |
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Much TOIL ahead
London, June 12 Oil producing nations have hardly done anything so far through OPEC to increase production. Saudi Arabia has claimed that it had increased production and the rise in oil prices is not justified. Many think that oil market speculation has in part been responsible for keeping the prices at a high level. An ominous warning has come from Alexey Miller, head of Gazprom, the world’s largest gas company, that oil could well be headed for $250 per barrel. He, too, holds market speculators as being partly responsible for the continuing rise in oil prices. But, then in the same breath, he holds the market situation of supply and demand being responsible for the current crisis and the impending disaster. The International Energy Agency in its latest monthly report has stated that the huge rise in oil prices is “largely explained by fundamentals”. The fundamentals being the mismatch between demand and supply of the oil, the failure of governments to harness other sources of energy such as nuclear energy for the industry is also responsible for this mismatch in energy consumption and supply. If the oil prices do touch even $200 per barrel - and not $250 as warned by Alexey Miller, the world could be headed for a crisis in which the food prices could soar to new heights as the costs of running tractors, tubewells and production of fertilisers are pushed upwards. Civil aviation would be hit hard as would also be tourism and travel industry. Household electricity and cooking gas bills could rise to all-time high making them beyond the reach of an average Indian family. For India, the whole crisis could be double whammy. Having failed to deal with the subsidies or think out of the hat in scrapping taxes and other duties on oil, the country could be heading for an unmanageable rise in inflation. For India there is no escape but to take urgent steps to create alternative sources of power generation to ensure that industry, farms and homes are freed from their dependence on oil for energy. Even if the price of oil does not touch $250 per barrel as he predicts, countries like India cannot manage with the price of oil rising to $200. — ANI
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Another price hike likely, says Moody’s
New Delhi, June 12 “As global prices continue to soar, the government will likely announce further increases in energy prices and cuts in subsidies,” said a report by Moody’s Economy.com. The government had earlier this month announced hike in price of petrol by Rs 5 a litre, Rs 3 for diesel and Rs 50 for a gas cylinder to help oil marketing companies partly meet their under recoveries because of surging global crude prices. Moody’s further said the authorities would continue to hand out assistance to the poor households while trying to tame inflation, given that price rise is the biggest obstacle of the incumbent government in restoring voters’ trust in the lead up to the general election. —
PTI |
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Annual General Meeting
Mumbai, June 12 “We estimate that our retail business will generate in excess of half a million jobs directly over the next five years,” Ambani said. He noted that the past year has seen Reliance deepen its involvement in the retail business. “We have now grown to nearly 700 stores, comprising 14 distinct formats across 60 towns and cities,” Ambani said. As part of deepening its retail foray, Reliance was tying up with marquee names in the business like Marks and Spencer from the UK, Pearle from Europe and Apple Inc from the US. Energy Projects
Mukesh Ambani said RIL would soon be commissioning the Jamnagar refinery and the east-west pipeline project later this year that would enable the company to become a major global player. These projects, Ambani said, would transform India’s energy security. He said the new Jamnagar refinery would create the largest refining site in the world and the commissioning of oil and gas production systems would make RIL one of the largest deep-water oil and gas companies in the world. Ambani said the Jamnagar refinery would be commissioned earlier than scheduled during the second half of the current financial year. RIL’s financials
Ambani pointed out that Reliance has become the first private sector company in the country to cross Rs 15,000 crore in net profit. Among its achievements include a global market share of 7 per cent in the polyester fibre and yarn business. Going further, Reliance envisages consolidating its global leadership in polyester with the new 2.5 million tons per year paraxylene manufacturing facility at Jamnagar, Ambani said. Going forward, Ambani said, RIL’s profits could be sharply reduced due to the high cost of hiring oilrigs and exploration equipment. Call for subsidies
Ambani said RIL had to shut fuel stations selling petroleum products because of the government’s refusal to provide subsidies to private sector players. “Absence of a level-playing field between private and public sector petroleum retailing companies gave rise to an unviable situation... Reliance had no alternative but to suspend sales from its retail outlets.” He added that RIL accounted for 14 per cent of diesel sold in India when it stopped retail sales, he said. |
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Plywood rates up by 7 per cent
Ludhiana, June 12 The increase, which is applicable with immediate effect, may also hit this industry that gets major competition from other plywood hubs like Yamunanagar, which are more cost competitive. The previous rise in plywood and plyboard rates in Punjab took place in December last year. “Hike in fuel rates has particularly hit us as the chemicals we use are petro-based. Wood prices, too, have been following an upward movement due to shortage of poplar and other wood. A significant increase has taken place in labour charges as well in the last few months. Even after the 7 per cent hike, we would not be able to fully cover the losses,” said Ashok Juneja, secretary general, Punjab Plywood Manufacturers’ Association. Manufacturers said items like phenol, formaldehyde, glue, core veneer and other chemicals had seen a 15 per cent hike in cost, while it was 20 per cent in case of wood and over 10 per cent in labour charges. Transportation costs, too, have been affected on the post-government decision on fuel prices. While the industry in Punjab supplies almost 70 per cent of its production to domestic markets, the remaining 30 per cent demand is generated from states like Maharashtra, Uttar Pradesh and Rajasthan.
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Bajaj Allianz to pump in Rs 500 crore
Mumbai, June 12 “Our present capital base is Rs 1,210 crore. This year we will be infusing up to Rs 500 crore fresh capital,” BALI’s chief executive officer Kamesh Goyal said here. He, however, made it clear that the capital infusion was not going to take place in the current quarter but in the subsequent quarters. Goyal said the company had incurred a loss of Rs 19 crore in the fiscal ended March 31, 2008, against a net profit of Rs 63 crore in FY’07. But added that the company was close to break even. “Whether we achieve that this year or in the next year is not an issue. We are only looking at maintaining growth rate with profitability,” he said. BALI is looking at 10 per cent market share by 2010 from 8.3 per cent now. “We are on the right track to achieve the target,” Goyal said. BALI also expects to sell around 4.5 million policies this fiscal, up from 3.7 million in the previous fiscal. However, he declined to give the projected growth in premium income saying: “It is difficult to predict”. — PTI
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