The Tribune, Chandigarh, India

	World Bank lends $4.3 bn Bhagyashree Pande Tribune News Service New Delhi, September 23 The World Bank will provide $4.3 billion loan to India for four projects in order to aid the country’s finance infrastructure building and for recapitalisation of state-owned banks. “India’s economic growth of between 5.5 per cent and 6.5 per cent this fiscal was realistic, but the country’s economic prospects hinges on a broader global recovery,” Roberto Zagha, World Bank country director for India, said. The four loans, approved by the World Bank’s executive board yesterday, include $2 billion loan to enhance banks’ capital, $1.2 billion loan to infrastructure financing company IIFCL, $1 billion to help address power deficiency, and $150 million to improve water supply in Andhra Pradesh. The loans are part of the World Bank’s $14 billion crisis-related lending to India for a period of three years till 2012. The $2 billion Banking Sector Support Loan, with a 30-year maturity, would help PSU banks expand credit for infrastructure development, small and medium enterprises, and the rural economy. “A global credit squeeze prompted banks to cut back on lending, but tight credit conditions now appear to be easing. The crisis also put added demands on public sector banks, as lending and deposit-taking by private and foreign banks had slowed. This loan will help maintain credit growth levels, support social banking and employment growth, and strengthen the economic recovery ahead,” the World Bank said. A $1.2 billion loan to the India Infrastructure Finance Company Ltd (IIFCL) is designed to support its role of private financing for public private partnerships in infrastructure projects and stimulate the growth of a long-term local currency debt financing market. In addition, the bank approved a $1 billion loan to address the country’s problem of acute power shortage by assisting the Powergrid Corp of India, the national electricity company, with its investment programme after a freeze in lending from overseas. The fourth loan of $150 million was approved for the Andhra Pradesh Rural Water Supply and Sanitation Project. The soft loan carries a 0.75 per cent service fee and a maturity of 35 years. The project is designed to improve water supply and sanitation services in 2,600 villages across six districts of the state. While the International Bank for Reconstruction and Development would provide loans for the banking sector, Powergrid and IIFCL, International Development Association would finance the project in Andhra Pradesh. The development policy loans have no conditions attached and would be disbursed in a single tranche after January 1, 2010, unless the Indian government prefers in installments.
	ONGC to pump in Rs 50,000 crore Tribune News Service New Delhi, September 23 State-run ONGC will invest over Rs 50,000 crore in developing new oil and gas fields and increasing output from the existing ones. The investments would help the company offset the decline in output that has set in mature fields like Mumbai High. The company has charted out three strategic pursuits, including intensifying exploration, improving recovery factor from existing fields, and aggressively pursuing for overseas projects, ONGC chairman RS Sharma said today. It has projected a 15 per cent increase in its oil production to 29 million tonnes by 2012-13. Of this expenditure, over Rs 16,000 crore is being invested to improve output from seven fields. ONGC will be investing more than Rs 15,000 crore in the second phase of redevelopment of its prime Mumbai High fields in the western offshore. It is investing Rs 8,061.42 crore in Mumbai High South by April 2011 for an incremental 20.7 million tonnes of oil and 3.32 billion cubic meters of gas by 2029-30. ONGC Videsh Ltd, the overseas arm of ONGC, will aggressively pursue overseas exploration and production projects .The company has 40 projects in 16 countries. During 2008-09, OVL acquired seven E&P projects in five countries, two being producing properties, Sharma said. ONGC’s output of oil and gas from domestic and overseas assets was marginally lower at 61.23 million tonnes of oil equivalent in 2008-09 as against the highest ever production of 61.86 million tonnes of oil equivalent the previous fiscal. Of this, 8.78 million tonnes of oil and oil equivalent gas were from overseas projects, Sharma said. Stating that international crude oil prices had peaked to $147 per barrel in July 2008 before plummeting to $33 a barrel in December that year, he said the prices crashed not because of any supply glut but due to sudden slump in demand which increased the spare capacity. However, we must realise that this spare capacity cushion is bound to erode once the economies recover which seems to be happening faster than expected, he said. We apprehend this may again bring uncertainty and volatility in the markets. The economic downturn has, however, not impacted the company’s investment plans as reflected in highest-ever capital expenditure of Rs 21,820 crore in 2008-09, he said adding 94 per cent of this was in the core activity of exploration and production.
	European demand for cotton textiles on the rise KS Chawla Ludhiana, September 23 Considering the recent rise in European demand for cotton textiles, local manufacturers are hopeful of heightened activity in textile exports trade soon. Ashwani Dhawan, a leading exporter of cotton textiles, told The Tribune that demand for cotton T-shirts and sweaters in France, Denmark and Sweden was picking up. France is emerging as the leading buyer of cotton textiles from the city. A TNS survey showed that European demand for end products of cotton is on the rise. But the cost of garments and fabrics remains under pressure as consumers want the prices to come down, which will result in lower profit margins. Moreover, the US, the mainstay of the textile industry, is still reeling under recession. DL Sharma of Vardhman Group told The Tribune that the mood of the buyer at Christmas would set the trend. The present trend showed that retailing was improving. He pointed out that the textile industry was hit by the shortage of unskilled workers as employment in Bihar and UP had increased due to the National Rural Employment Guarantee Scheme. Minimum wages for unskilled workers in Punjab are Rs 3,300 and Haryana Rs 3,600 per month. Ashwani Dhawan said the US buyers had begun taking credit for 60 days instead of 30 days to cope with the situation. Presently global companies like Wall Mart and GAP, both US-based units, have placed orders for readymade garments and T-shirts from India. Sharma pointed out that the profit margin of the cotton textile mills was in the negative zone between October 2008 and June 2009. About 70 per cent textile mills in the country was under loss during this period. Even the cost of cotton yarn is on the rise, which in turn would affect the textile goods.
	Power cuts hit scrap dealers hard Shivani Bhakoo Tribune News Service Ludhiana, September 23 Regular power cuts have cast their shadow on the scrap dealers across the state. With rates of scrap coming down by about 50 paise per kg in recent times, the scrap dealers said even then the furnace and rolling mill owners felt reluctant to lift scrap as production in their units had come down to 50-60 per cent due to three days' weekly power cuts. The scrap dealers in Mandi Gobindgarh, the hub of induction industry in the region, maintained that rates of old and melting scrap had fallen by 50 paise per kg. "Earlier, units worked for about 90 hours but three-day power cut means that units will run for about 60 hours only. Why should induction and furnace owners buy scrap when they will not be able to generate the required production? The old scrap available for Rs 18 per kg was now being sold at Rs 17.5 and the rates of melting scrap had come down to Rs 19.5 in recent times. The scrap dealers, specially the smaller ones, are finding it difficult to survive in such conditions", said Rattan Kumar, a scrap-dealer at Mandi Gobindgarh. Fasteners Association president Narinder Bhamra said there were about 50 induction units in the city and more number of units were being run in Mandi Gobindgarh. He said each unit used 50-75 tonnes of scrap a day but in the absence of desired production, the consumption of scrap has decreased. President of Induction Furnace Association of Northern India, KK Garg said the PSEB had created labour unrest in the induction industry. He said in the absence of work for three days in a week, the labour became idle and their wages were deducted. He further said export orders of big industrial units were also hit due to low production.
	Ford unveils small car for Indian market Tribune News Service New Delhi, September 23 Ford India today became the latest carmaker to bite the ‘small car bug’ as it announced the launch of a small car, especially for Indian market. The US auto giant unveiled "Ford Figo", which would hit the Indian roads by early 2010. The Figo, which is colloquial Italian for "cool", will be manufactured at the company's Chennai facility. The Chennai unit is undergoing a $500-million revamp as Ford seeks to make India a global production hub for its small cars. The company is also planning to double its manufacturing capacity at its Chennai facility to 200,000 units per annum by 2010. Ford's global president and chief executive Alan Mulally, who unveiled the car here said, "The Figo is designed to compete in India 's small car segment, which accounts for more than 70 per cent of the market". Figo leverages Ford's small-car platform architecture, sharing underlying technology with the Ford Fiesta. The company, however, declined to give specific details like price and engine capacity. Asked about the price range of the Figo, Michael Boneham, Ford India president and MD, said: "It's going to be very competitive with the current market leader and will offer a tremendous value for our consumers." Figo is a four-door hatchback, powered by an indigenous diesel and petrol engine. It is expected to compete with the Hyundai i20 and the Suzuki Swift.
	Punjab proposes 11 new industrial clusters Ruchika M. Khanna Tribune News Service Chandigarh, September 23 Having realised the usefulness of the Micro and Small Enterprises Cluster Development Scheme, the Punjab government is now keen on setting up at least 11 new industrial clusters across the state. It is learnt that the state government has proposed to the Government of India for setting up one cluster each at Ludhiana, Malerkotla and Moga, four at Jalandhar, two each at Mandi Gobindgarh and Malout. The proposal has been sent to the Union government, after the successful implementation of the cluster development programme at Ludhiana and Mohali. While eight clusters for different industries have been approved in Ludhiana, a cluster for hi-tech metal cluster has also been approved at Mohali. The proposed clusters include a printing and packing cluster at Ludhiana, rubber goods cluster, Jalandhar, mellable galvanised pipe fitting cluster, Jalandhar, hand tools cluster, Jalandhar, valves and cocks cluster, Jalandhar, chill roll cluster, Malerkotla, agriculture machinery cluster at Malout, leather shoe cluster at Malout, steel re-rolling mills cluster, Mandi Gobindgarh, Refractory Manufacturers Association cluster, Mandi Gobindgarh and agriculture implements cluster at Moga. SS Channy, principal secretary, industries, informed TNS this would help in the enhancing productivity and competitiveness as well as capacity building of small enterprises. “While 80 per cent of the total project cost would be borne by the Government of India, the rest will be borne by the state government and industry organisations,” he said.
	Mobile number portability in metros by Dec 31 Tribune News Service New Delhi, September 23 Telecom regulator TRAI today said Mobile Number Portability (MNP) will be implemented in metros and category ‘A’ service areas from December 31. It added that deadline for the rest of the country was March 20, 2010. The MNP facility will allow subscribers to retain their cell phone numbers even if they want to change the service provider for any reason. The announcement from TRAI comes quite in contradiction to the government’s stand which earlier this month had said implementation of MNP would be delayed by three months as regulations were still being made. Issuing “Telecommunication Mobile Number Portability Regulations, 2009”, TRAI said the facility would be available within the given licensed service area only. The subscriber holding a mobile number would be eligible to make a port changing request only after 90 days of the date of activation of his mobile connection. While the cost of changing the subscriber is still to be worked out, the guidelines say that if a number has been ported once, it can again be ported only after 90 days from the date of the previous porting. The user who wishes to port his mobile number should approach the recipient operator. The user will have to clear all bills issued prior to the date of porting request.
	FM against tightening of monetary policy Kolkata, September 23 Finance Minister Pranab Mukherjee today said RBI should not tighten the monetary policy as the government has planned to borrow huge amounts from the market. "I am not prescribing a tight money policy", he said, pointing out that fiscal and monetary policies adopted by the government and the RBI to combat the slowdown are paying dividends and signs of recovery have started to show up. The government proposed to borrow about Rs 4.5 lakh crore from the money market during the current fiscal against Rs 3.1 lakh crore in the previous fiscal. RBI, which has considerably eased the monetary policy to provide liquidity to the crisis-hit industry, is slated to announce second quarterly review of the monetary policy on October 27. Referring to the growth prospects during the current fiscal, the minister expressed hope that the country would register over 6 per cent GDP growth. "Both the fiscal and the monetary policies are working well in tandem and paying dividends," he added. — PTI