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6.84% Inflation at 9-mth low
Sensex back at 10
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India Inc may not go for 2009 salary hikes
Motorola bosses take pay cut
Govt seeks House nod for more funds
BSNL defends decision of MoU with Swan
Study: Maruti, Honda models top design, performance
BlackWater Europe Tech forays into India
Satyam board to consider buyback shares
BA, Qantas merger talks fail
Apparel units to miss export target
SBI brings down MSME rates
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There will be some pain: PC New Delhi, December 18 Donning the cap of the finance minister of the country P Chidambram, currently the home minister, replied to the debate on the Indian economy in the Lok Sabha even as Prime Minister Manmohan Singh, technically in charge of the finance portfolio, sat appreciatively by his side. Chidambram said: “This year we will have to trim slightly, still we will have a growth of 7 per cent even as the world growth is likely to register at zero per cent. That would still make us
the second fastest growing large economies of the world after China.” He, however, added: “There will be some pain,” and assured simultaneously that “We will ensure that production does not suffer and everyone continues
to grow.” He debunked the Left apprehension that there was any move to privatise nationalised banks and instead announced: “We are going to further capitalise the banks so that their CRR grows from 10 per cent to 12 per cent.” The proxy finance minister debunked the BJP members’ concern as insincere and reeled out figures to compare the growth of GDP, revenue collection, reduction of fiscal deficit and spending on social sectors during the last four years, as compared to the six years’ rule of the NDA government. Chidambram dismissed the criticism that the per capita expenditure by 80 per cent of India’s population is only Rs 20 and instead claimed that per capita income in the UPA regime has grown by 7.2 per cent. Earlier initiating the debate CPM leader Rupchand Pal criticised the government for its “inept” handling of the global economic meltdown and asked it to come out with a comprehensive policy to tackle the situation. He said adjustments in CRR by the Reserve Bank of India here and there did not help matters, and the government must come out with a proper package. Pal said at least 65,000 people had been rendered jobless in textiles, garment, construction, jewellery, aviation and such other sectors in recent month due to the recessionary trends. This, he said, did not include loss of employment in construction sector which could add to another 800,000 jobless people. The CPM leader mentioned the crash from at the stock exchange from 21,000 points in January 2008 to 9,000 points now and expressed concern over the fate of affected small investors adding that the rupee had seen a 25 per cent depreciation vis-a-vis the dollar. BJP leader Ananth Kumar regretted the reduced spending on 47 highway projects and declared the government looked for votes towards the “Aam aadmi” but showered its munificence only on the moneyed class. Flaying the government for “bringing the economy to a mess”, he said while the fiscal deficit and inflation were increasing, the government would lose over Rs 40,000
crore because of duty cuts announced by it. He pointed out that the inflation had dipped now due to the slide in prices around the world. Members from all other parties spoke on their respective party lines.
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6.84% Inflation at 9-mth low
The trend is clear for falling inflation and this will translate into lower interest rates, economic affairs secretary in the finance ministry Ashok Chawla said while commenting on the inflation data. Inflation, as per the official figures, dropped for the sixth consecutive week to a nine-month low of 6.84 per cent for the week ended December 6. He further said the Reserve Bank must be keeping a watch on inflation and might take steps if necessary. Inflation, measured by wholesale price movement, dipped by 1.16 per cent for the week ended December 6 from the previous week, triggering demands from the industry for further cuts in key policy rates by the RBI. A Rs 5 per litre cut in petrol prices and Rs 2 per litre reduction in diesel rate on December 6 helped bring down inflation. Commenting on the decline, Ficci secretary general Amit Mitra said: “The RBI should cut interest rate expeditiously and by a significant quantum. It must also ease availability of credit further.” The RBI has reduced the short-term lending rate (repo rate) from 9 per cent in October to 6.50 per cent, and the reverse repo rate to 5 per cent from 6 per cent, signalling a softer interest rate regime. Industry chamber Assocham wanted the CRR and policy rates at 2004 level so that stressed sectors, particularly cement, steel, mining, aviation, banking and finance, could boom again. NCAER director general Suman Bery said: “The inflation numbers have reduced much more sharply than expected as the global deflationary wave is having an impact on the country too. Inflation is no longer the main concern. This gives the RBI more space to ease monetary policy.” Apart from fruits and vegetables, prices of imported edible oil, rice bran oil and coconut oil declined. However, prices of non-food articles rose by 0.1 per cent on the back of fodder, groundnut seed, gingelly seed and raw cotton. In the manufactured products category, atta (by 2 per cent), groundnut oil and ghee (by 1 per cent) and cotton seed oil became dearer during the week. |
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Sensex back at 10
Mumbai, December 18 Reports that the government would pump in another Rs 42,000 crore into the economy as part of another round of stimulus also added to the bullish sentiment. The benchmark index gained 361 points
higher to close at 10,076 levels. In the broader markets, the Nifty also gained 3.6 per cent to close at 3,060 levels. The lowering of fuel prices earlier this month caused inflation for the week ending December 6 to fall to 6.84 per cent from 8 per cent the week before. Analysts predicted that inflation would fall to
below 3 per cent by March next year on the back of declining prices across the board. Today's gainers were led by realty and banking stocks. The BSE realty index was up 7.3 per cent and the banking index zoomed 7 per cent. Among the major gainers included DLF and Unitech, which were up more than 9 per cent each. Among the banking stocks ICICI Bank, Axis Bank and Canara Bank closed more than 8 per cent. |
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India Inc may not go for 2009 salary hikes
New Delhi, December 18 Majority of companies in the country are trying to be selective in planning the workforce, compensation and benefit cuts for 2009, while they anticipate a decline in their company’s business performance next year, according to global HR consultancy Mercer. The survey revealed that as much as 83 per cent of companies expect salary increases in the coming year to be lower than originally planned by them. The responses indicate that the companies are planning to look closely at holding down the level of compensation increases in 2009. However, only 19 per cent of survey respondents are considering the more drastic step of freezing 2009 salaries at 2008 figures. The results for companies in India generally match survey findings from other parts of the world. In China, Australia, the UK and the US as well between 20 and 30 per cent respondents believe that the 2009 bonus payout would be reduced from those originally planned. “India grew on the back of her knowledge and people-centric industries such as financial services, information technology and retail, among others. However, primarily due to employee costs having risen in India at double-digit rates since 2003, cost structures have been coming under severe strain,” Mercer Consulting (India) country leader Padma Ravichandar said. Most companies in India plan to avoid significant workforce reductions, but they do not plan significant hiring either, the survey revealed. Nearly two-thirds (63 per cent) of companies surveyed revealed that a significant reduction in workforce was unlikely even as only one in four firms expect to continue their hiring activities at or above replacement levels. This current situation should be perceived as a cooling-down period in terms of talent costs. This is a levelling act that may help India remain cost competitive in the long run. In the near term, the adverse impact of business sentiment seems all pervasive, Ravichandar added. Over 80 per cent of respondents expect their company’s business performance to decline in 2009, the Mercer survey noticed. Further, corporate India expects mergers and acquisitions to be severely affected in the next year, with fewer than 7 per cent of survey respondents expecting increased M&A activity. Mercer’s survey, conducted in early November, collected responses from over 100 human resource and finance professionals in India, as part of more than 1,000 responses from around the world.
— PTI |
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Motorola bosses take pay cut
New York: Leading mobile phone maker of the US, Motorola, will undertake cost-cutting measures, including freezing pay hikes, while company's co-chief executives - Greg Brown and Sanjay Jha - would take a 25 per cent voluntary cut in their salaries.
Motorola would permanently freeze its US pension plans from March 1, 2009. “Employees would not receive a salary increase in 2009,” the company said in a statement. “Motorola co-chief executive officers Greg Brown and Sanjay Jha will voluntarily take a 25 per cent decrease in base salary in 2009,” it noted. Further, the firm would permanently freeze its American pension plans, preserving vested benefits accrued by employees and retirees but eliminating future benefit accruals. “Motorola intends to continue to provide funding to meet its pension obligations to present and future retirees,” it added. “The sustained downturn in the global economy requires that we take these difficult but necessary steps,” Greg Brown and Sanjay Jha said in a statement. |
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Govt seeks House nod for more funds
New Delhi, December 18 The second batch of supplementary demands for grants tabled in the Rajya Sabha seeks a gross additional expenditure of Rs 55,604.83 crore, of which the net cash outgo would be Rs 42,480.10 crore. The demands for grants are sought from Parliament within a fortnight of the Prime Minister’s Office
(PMO) announcing a stimulus package that included extra public spending by Rs 20,000 crore to boost economy, in addition to reducing excise duty by 4 per cent. The lion’s share of increased plan expenditure of Rs 14,500 crore is being sought for rural development schemes, including housing and roads. The recession-hit textile sector is being earmarked Rs 1,400 crore towards modernisation of mills, according to the demands tabled by minister of state of parliamentary affairs V. Narayanasamy in the Upper House. To give a boost to the urban infrastructure, Rs 7,500 crore would be transferred to states and Union Territories. The second tranche for demands for grants is over and above the budgetary allocation of Rs 7.5 lakh crore and about Rs 1 lakh crore sought in the first batch of supplementary demands for grants. In addition to a cash outgo of Rs 26,265 crore for plan schemes in the second batch, the government is also seeking Rs 16,215 crore to meet extra expenditure, mainly towards food and fertiliser subsidy and defence pensions.
— PTI |
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BSNL defends decision of MoU with Swan
New Delhi, December 18 The company has provided Swan Telecom with roaming agreement on its network even as the PSU is still to have similar agreements with other already existing private telecom operators resulting in accusation of favouritism. The BSNL has also replied to the Department of Telecom that it has an MoU and not an agreement with Swan Telecom for intra-circle roaming arrangement. The officials say the MoU is very clear that if at all the state-run operator would have spare capacity available, only then will it carry their calls. BSNL chairman and managing director Kuldeep Goyal said: “As of now nothing is final on sharing and we are open to give services to others as well. If the trial with Swan works out, it is a pure business case to explore more revenues.” “It is only to get additional revenue it can be done with other telcos as well. There is no exclusive arrangement with Swan on this issue,” he elaborated. The controversy erupted after a Member Parliament wrote to the Prime Minister pointing out that while BSNL has never done any roaming agreement with any operator, it has entered into one with Swan Telecom that smacks of favouritism. Subsequently, the communications ministry asked BSNL to submit their replies over this allegation if it had favoured Swan Telecom, a new entrant that was granted telecom licences earlier this year. Incidentally, the BSNL is also under pressure to retain its falling market share and revenues from a competitive market where call rates are as low as 20 paise. |
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Study: Maruti, Honda models top design, performance
New Delhi, December 18 The study - India automotive performance
execution and layout - provides an analysis of what excites and delights owners about their new vehicle’s performance and design during the initial two to six months of
ownership. It examines nearly 100 attributes covering 10 vehicle factors such as vehicle exterior and interior, space, audio/entertainment, seats, heating and ventilation among others. Four Maruti Suzuki models - Swift, Swift DZire, SX4 and Wagon Reach - receive awards in their respective segments. In the entry midsize segment, the newly launched Swift DZire ranks highest with a score of 802 points on a 1,000-point scale. The Swift and SX4 each ranks highest for a second consecutive year in the premium compact and midsize segments, respectively. In particular, satisfaction with fuel economy has improved considerably for the Swift from 2007, largely due to the launch of the new Swift Diesel, the study says. “The newest generation of Maruti Suzuki products has clearly helped improve the brand’s overall image,” said J.D Power and Associates senior director Mohit Arora. Honda’s Civic ranks highest in the premium midsize segment with a score of 821, while the CR-V tops for a second consecutive year in the SUV segment and also posts the highest score
in the industry in 2008. — PTI |
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BlackWater Europe Tech forays into India
Chandigarh, December 18 With almost 8.1 lakh inkjet printers and 5.3 lakh laser printers being sold across the country in the past two years, there is a growing need to have a service centre for these printers. It is estimated that the cartridge refilling and refurbishing market in India is worth Rs 4,500 crore and a negligible percentage of this is being serviced by the organised sector. “Since a very small part of this market is served by the organised sector, including the original equipment manufacturers who charge exorbitant rates for providing new cartridges, we have decided to enter the Indian market. We hope to earn a turnover of Rs 100 crore by the end of year 2011,” said a senior company official. The company, which is the Indian subsidiary of One GN Partners, will be opening these technology stores “Vineport” on a franchisee model. The first store will be opened in February and the company hopes to have 90 stores by the end of the year. The company will first be targeting all cat I cities in the country and later spread its network to important cat II and cat III towns. |
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Satyam board to consider buyback shares
Mumbai, December 18 “A meeting of the board of directors of the company will be held on December 29 to consider the proposal for buyback of shares of the company,” Satyam said. The company's move to mollify shareholders comes after it raised investor ire on its proposed $1.6-billion acquisition deal, which had to be
called off. The company on Tuesday had announced a $1.6-billion deal to acquire Maytas Properties and Maytas Infrastructure — companies run by Satyam chief Ramalinga Raju's sons B Rama Raju and Teja Raju. However, investors’ opposition had forced Satyam to call off
the deal just a day later. — PTI |
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BA, Qantas merger talks fail
London, December 18 “Despite the potential longer term benefits for Qantas and BA, the airlines have not been able to come to an agreement over the key terms of the merger, at this time,” the two companies said in a joint statement. Meanwhile, Qantas and BA would continue to work together on their joint business, it added. The two companies had explored a potential merger by way of a ‘dual-listed company structure’ in which each would have retained their name and branding. Further, discussions between BA and Spain’s leading air transport group Iberia are also continuing. — PTI |
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Shutdown at Chrysler
Chrysler’s announcement on Wednesday comes after US lawmakers last week failed to agree on a $14 billion emergency loan for the US car industry. Chrysler and General Motors have said they did not expect to survive without federal aid. Chrysler said its dealers were already over-stocked as car sales over the past months have plunged about 35 per cent to 25-year lows in the US. The plant closures, 30 in total, will “keep production and dealer inventory aligned with US market demand”, the company
said. — Agency |
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Apparel units to miss export target
Mumbai, December 18 “Our export target for the fiscal was $9 billion. But due to the present market conditions, we will be able to close the year with exports of only $8-8.5-billion,” Confederation of Indian Apparel Exporters' president Amit Goyal said here. The sector, which laid off around 75,000 workers in the April-October period, expected a further retrenchment of up to 2-3 lakh workers in 2009, he said. “Looking at the market conditions, we anticipate that the apparel industry might have to lay off another 2-3 lakh workers ,” he said. — PTI |
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SBI brings down MSME rates
Mumbai, December 18 In tune with the recent announcement of the PSU banks to cut lending rates by 50 to 100 basis points, the SBI has taken the initiative to enable micro enterprises to avail working capital finance in as low rate of interest as 10.25 per cent. This reduction has been brought about for SSIs as well as larger manufacturing MSMEs, with working capital limits up to Rs 10 crore, SBI said. Earlier, the bank had taken a slew of measures to support MSMEs, gripped by the economic slow down. These included reduction of margin for sanction of limits, and extending the working capital cycle to cover longer period of holding of inventory and receivables.
— UNI |
Rupee at 46.95 Oil $40.32 a barrel DLF Brands plans Jindal Poly investment plans Appointed McNally Bharat bags orders PSEB in pact with Parbati Koldam
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New Delhi, December 18
Washington, December 18
