New Delhi, August 12
At a time when the weak monsoon is threatening to reduce farm output, Indian industry started showing signs of revival as it clocked 7.8 per cent growth in June, reversing the extremely bleak trends that had set in since the collapse of Lehman Brothers in September 2008.

Effects of fiscal and monetary stimulus were visible as manufacturing, the worst-affected, grew by a whopping 7.3 per cent in June over 6.1 per cent a year ago.

With manufacturing constituting about 80 per cent in the Index of Industrial Production (IIP), industrial growth at around 8 per cent in June was way above the 5.4 per cent a year ago.

Mining grew by a substantial 15.4 per cent and power was up 8 per cent in June.

For the first time after Lehman Brothers collapsed, segments like capital goods, consumer durables, consumer non-durables did not show contraction in output.

Industrial growth stood at 3.7 per cent in the first quarter of this fiscal against 5.3 per cent a year ago. Given the fact that industry started contracting since September, its growth, if this trend persists, will be higher because of a low base. With the weakening monsoon casting a shadow on farm growth, this kind of industrial growth may offset the adverse impact partly.

In the same month last fiscal, the industry grew by 5.4 per cent. However, the growth was 5.3 per cent in the first quarter a year ago.

Commenting on the recovery of the industrial sector, Planning Commission Deputy chairman Montek Singh Ahluwalia said, "I always expect the positive trend (in industrial growth) to continue. However, weak monsoon could have some negative impact on the overall GDP." According to the IIP data, 12 out of 17 industrial segments during June recorded positive growth compared to the corresponding month of the previous year. 

Bangkok, August 12
India and 10-nation economic bloc Association of South East Asian Nations (ASEAN) will ink a free trade pact here tomorrow, which will open the 1.7 billion consumer market to each other.

After six years of painstaking talks, the Comprehensive Economic Cooperation Agreement (CECA) will be signed, which will eliminate duties on 80 per cent of goods traded between the two over the next eight years.

Commerce Minister Anand Sharma, who is here to sign the pact, said the agreement was well balanced and was in harmony with India’s Look East Policy.

“I can say negotiations have been painstaking. The negotiators have ensured that our sensitive areas where we had concerns are fully addressed,” Sharma said.

When asked whether the concerns of plantation growers of south India have been addressed, Sharma said the whole debate of the CECA adversely impacting domestic planters was based on “uninformed” speculations. FICCI Secretary General Amit Mitra, who is accompanying Sharma, said, “This agreement will be a win-win situation for India and ASEAN.”

Under FTA, as many 489 items from agriculture, textile and chemicals have been included in the negative list, meaning these products will be kept out of the duty reduction.

However, duty on products included in the sensitive list, including tea, coffee, spice and rubber, will be reduced by 2019. This has raised political resistance to signing of FTA.

Planters in South Indian, especially Kerala, fear lower duty on plantation crops would lead to deluge of imports from ASEAN members like Indonesia, Malaysia, leaving the domestic procurers in a tight spot.

After signing the agreement, next phase of negotiations will cover trade in services, a key area of interest for India.

Sharma said "papers have been exchanged" between India and ASEAN to start negotiations on trade in services.

India's Look East Policy is India's well thought out strategy to increase engagement of the country's north-east and eastern parts with the entire ASEAN block.

The bilateral trade between India and ASEAN was to the tune of about $40 billion in 2007-08. — PTI 

New Delhi, August 12
The government today said the technical textiles segment, which is engaged in production of the specialised variant of the commodity used by industries, might become a Rs 66,441-crore industry employing additional three lakh workers by 2012.

“We expect investment of Rs 5,000 crore (in technical textiles sector) and employment, which is approximately nine lakh at present, to increase to 12 lakh, by 2012,” Textiles Minister Dayanidhi Maran said at Technotex-2009, a function jointly organised by the ministry and FICCI.

Maran said the domestic market size of technical textiles in the country was expected to grow at the rate of 11 per cent per annum.

Unlike conventional textiles, which are highly export intensive, these are import intensive and are mostly used by industrial houses for various purposes.

However, the country’s contribution in the over $125 billion global market is insignificant. The industry is about Rs 37,115 crore at the moment.

Speaking at the function, Minister of State for Textiles Panabaaka Lakshmi said with the governmental thrust on the infrastructure sector, the industry held immense potential.

On the occasion, Maran launched the website, ‘www.technotex.gov.in’.

Considering the government’s plans to invest heavily in core areas in the coming years, Lakshmi said, “To appraise various consumers, especially in the public sector about the applications of technical textiles and their benefits, the ministry in partnership with industry chamber FICCI will be organising series of workshops.”

All technical textiles machinery was covered under the Technology Upgradation Fund Scheme which was eligible for 5 per cent interest reimbursement. Specified machinery manufacturing of technical textiles were covered under 10 per cent capital subsidy, she said. — PTI 

Bangalore, August 12
A recent CII report predicts that during the next few months, sales and profitability of the textile sector, especially mills and textile and clothing units, will rise from the lows of 2008.

Some fabric and garment production units have reported a recent “pick-up” in international demand. This is expected to translate into higher demand for spun yarns.

While spinners are reporting a slack demand for cotton and polyester cotton yarns, polyester viscose yarn manufacturers continue to receive export orders.

According to the study, operating margins registered decline in financial year 2008-09, due to an increase in operating costs. Domestic demand also showed signs of slowdown. Moreover, the appreciation of the rupee in 2008 made textile and clothing exports uncompetitive.

The study estimates an 8 per cent decline in cotton production in the country to about 29 million bales during the current year. There can be 5 per cent decline in domestic cotton consumption in 2009. However, the consumption can pick up slightly in 2010, the study says.

Lack of rains in central and southern states had affected cotton sowing season in 2008. However, the arrival of monsoons in July made up for the fall in acreage.

In the wake of firm prices in 2009, there are indications that the country’s cotton acreage might increase from 9.37 mha in the current year to 9.5 mha in 2010. Domestic raw cotton prices had increased significantly during 2007-2008, due to strong export demand.

However, during 2009, in spite of the Central government raising the minimum support price of different varieties of cotton seed by 39 to 45 per cent, cotton prices have declined sharply because of weaker international prices and less favourable demand prospects.

Textile industry is an export-oriented sector with about 60 per cent of its produce being exported. The study suggests that the government must provide incentives to the industry in order to make it more competitive. Pointing out that Indian cotton was cheaper in the international market than in the domestic market, the study says the government must take steps to stabilise raw cotton prices on par with neighbouring countries like China, Bangladesh and Pakistan. 

Hyderabad, August 12
After missing the bus once in the past, the Andhra Pradesh government has now decided to get into natural gas exploration and production business and bid for gas fields.

A Special Purpose Vehicle (SPV) will be formed in collaboration with global gas majors and international consultants will be engaged to prepare the bid documents.

The decision was taken at a high-level meeting chaired by Chief Minister Y S Rajasekhar Reddy here yesterday.

The Chief Minister directed the officials to form the SPV at the earliest and prepare an action plan ahead of the state’s participation in the country’s largest-ever auction of oil and natural gas blocks under the eighth edition of the New Exploration Licensing Policy (NELP- VIII).

The move comes against the backdrop of AP’s bitter experience with Reliance Industries which has struck huge gas reserves in the Krishna-Godavari Basin.

Despite massive reserves being found in the state, AP has been unable to get the gas allocation on priority basis even as the Ambani brothers are locked in a bitter legal battle over gas supply.

Vexed with the delay in getting gas allocation from K-G Basin, the state government has decided to enter exploration and production business and bid for gas fields.

Meanwhile, the Director General of Hydrocarbons V K Sibal today met the Chief Minister here and made out a strong case for AP to get into gas exploration business through joint venture route. He advocated that state government float a SPV in collaboration with global majors to take up the activity in the K-G basin.

New Delhi, August 12
Reacting strongly to news reports that the state-run BSNL should not pursue 3G technology, the public sector telecom operator today said it had added over 40,000 3G customers in the last six months.

In a statement issued here, it stated that the BSNL started its 3G services in the north and east zones of the country in February last. It started off with 12 cities and had gradually expanded to 113 cities as on date. The BSNL acquired 10,733 connections by June-end and has got over 40,000 customers till date.

It said in the earlier stages coverage in cities was less but now it has covered cities in entirety.

It pointed out that while initially only four services were available - video calling, video conferencing, mobile TV and mobile broadband - since the last month, additional services like video on demand, video screening, full track music download and online multiple player games have also been started.

The PSU said from August 15 onwards, the tariff on 3G services would be substantially reduced. 3G SIM cards would be available for as low as Rs 59 and prepaid activation could be done for just Rs 120.

For postpaid subscribers, activation vouchers would be available at Rs 225 and migration from 2G to 3G services has been made absolutely free.

As an added incentive on the occasion of Independence Day, free unlimited video call are being offered for one month from the date of activation for connections provided till August 31.

“ It may be further mentioned that 3G services is not just an elitist service, but also for the general public as it improves the quality of voice and helps in reducing the congestion in the existing network,” it said in the statement.

BRIEFLY

NHPC IPO subscribed over 16 times
Mumbai: The initial public offer of hydro power producer NHPC got subscribed over 16 times with most of the bids coming in from institutional investors. The issue received bids for over 2,762.99 crore shares against 167.73 crore shares on offer, as per the data available on the National Stock Exchange.— PTI

Airtel small format store
Chandigarh: Bharti Airtel on Wednesday opened its first small format store (SFS) in the Chandigarh region, comprising the states of Haryana, Punjab and Himachal Pradesh. The store was inaugurated at Zirakpur by Sanjeev Kumar Saxena, CEO (mobility), Airtel (Haryana, Punjab and Himachal Pradesh). The store offers all types of facilities and services under the Airtel brand under one roof. — TNS

Syndicate Bank branches
Chandigarh: Syndicate Bank will open three new branches and 10 off site ATMs in the region during this fiscal. Disclosing this here on Wednesday, PN Malhotra, DGM, said the new brnaches would be opened at Kundli, Kaithal and Baddi, taking the number of branches in North India to 67. — TNS

Jaypee Group, L&T ink deal
New Delhi: Jaiprakaskh Power Venture promoted Jaypee Group and construction firm Larsen & Toubro on Wednesday signed Rs 4,000-crore agreement for the supply of boiler and steam turbine generator. "As per the agreement, L&T will supply super critical units for the 2x660 MW thermal power project for Jaiprakash Power Venture," the company said. — PTI