The Tribune, Chandigarh, India

Foodgrain prices set to come down: FM

London, November 9
Soaring foodgrain prices are set to come down “after a month or so” as a result of steps taken to import food and build up a buffer, Finance Minister Pranab Mukherjee said.

“Though the production of grains has been hit, there are adequate buffer stocks” — nearly eight million tonnes of wheat and more than seven million tonnes of rice, Mukherjee said here on Sunday.

“We have taken adequate care to maintain the demand and supply position by allowing commodities of shortfall to be imported without any duty.” Mukherjee said although the overall agricultural scenario appears to be “bright”, India is “not totally out of the woods”.

“Things have started improving and I'm quite confident that, as the Prime Minister mentioned today, that if rainfalls are adequate then next year we'll have higher growth projections of more than seven per cent. I am also optimistic to that extent.”

Admitting there were inflationary pressures, he said “to what extent they will go beyond the manageable level is yet to be seen".

“Seasonal factors have contributed to the high prices of some of the essential commodities, and I do hope it will be possible to have a moderate impact after a month or so, particularly for those crops which are adversely affected by the seasonal factors.”

Mukherjee said the government, having guaranteed rural employment through the National Rural Employment Guarantee (NREG) scheme and cleared the right to education bill, is now keen to legislate the right to food.

“I do hope shortly it will be put up on the website of the agriculture ministry — they are working on the draft.

“These entitlements are being backed by the legal rights which will strengthen the Indian people and facilitate the cardinal strategy of our growth strategy — inclusive growth,” Mukherjee added.

‘No more stimulus packages’

Citing the urgent need to cut India's fiscal and revenue deficits, Finance Minister Pranab Mukherjee on Sunday ruled out any further special packages to stimulate the Indian economy. But, he added, the timing of its exit from the stimulus strategy will be of India's choosing — to be determined on considerations of world economic output and growth rate — rather than any globally synchronised "date-specific" criteria.

Addressing Indian journalists at the end of a meeting of finance ministers from the Group of 20 countries, Mukherjee indicated the three stimulus packages implemented between December 2008 and February 2009 had achieved what his government set out to do — halt the slide in the economic growth rate that had plummeted to 5.6 per cent last fiscal.

"As a consequence, we had 6.7 per cent growth rate," he said.

With the world's richest nations — the European Union, North America and Japan — accounting for 62 per cent of Indian exports, Mukherjee said: "Our economy cannot pick up without global recovery." Mukherjee said current levels of fiscal deficit "cannot be sustained for a longer period of time", and that fiscal deficit had to come down to 4 per cent and revenue deficit to 1.5 per cent by 2012.— IANS

Food price inflation to ease by Dec: Montek

New Delhi: India’s food price inflation is likely to come down by the year-end, as per estimates made by the country’s planning department. While overall inflation rate is below 2 per cent, food price inflation is above 13 per cent.

“Food price inflation by the end of the current fiscal would be significantly lower than what it is right now,” Planning Commission deputy chairman Montek Singh Ahluwalia said at the India Economic Summit on Monday.

According to Planning Commission, while overall food price inflation is expected to come down by the year-end, vegetable prices, in particular, would fall by December-January.

While food price inflation would come down, other inflation might go up, he said, adding that the year would end with an annual inflation figure of 5-6 per cent. — TNS

Gold at record high in global markets

Singapore, November 9
Gold in London, New York and Shanghai surged to records as the weakening dollar prompted investors to increase bullion holdings as a store of value.

At Singapore, gold for immediate delivery shot up by $10.01 to reach an all-time high of $1,105.11 an ounce as expectations for record low borrowing costs in the US drove down the dollar, gold buying by the Reserve Bank of India last week raised speculation that other countries will follow suit.

Gold for December delivery on the Comex division of the New York Mercantile Exchange added as much as 0.9 per cent to $1,105.40 an ounce, surpassing its November 6 peak of $1,101.90.

The precious metal for delivery in December in Shanghai gained 0.9 per cent from the previous settlement price to 241.19 yuan a gram ($1,099 an ounce), the highest price since futures started trading in January 2008.

At the MCX in futures trade in India, the metal for delivery in December surged to record high of Rs 16,692 per 10 gram.

The precious metal rose to a record in global markets as a weaker dollar spurred demand for the metal as a hedge and as central bank purchases buoyed confidence in the outlook for demand.

Gold also climbed last week after the RBI bought 200 metric tons from the International Monetary Fund. — Bloomberg

Now, call at half paisa per second
Price war to hit telcos’ margins
Girja Shankar Kaura
Tribune News Service

New Delhi, November 9
The price war unleashed in the telecom sector with the entry of some of the new operators is bound to hit the profit margins of the existing operators and also the kitty of the government.

After Tata-Docomo announced one paise per-second call benefit to its subscribers, the price war has now reached another level with MTS offering half a paise per-second call to its subscribers on the local network.

While the subscribers are bound to emerge as the winners in the price war, experts do not rule out the possibility of another round of price cut announcements from the telecom operators to match the offer being made by MTS, eventually hurting the margins of the operators and the government similarly.

Only late last week, BSNL had become the last of the telecom operators in the country to announce a one paise per-second call to its subscribers, joining the bandwagon of the telecom companies.

Although, the telecom operators have been forced to join the price, the pinch in the operating margins is already being felt.

Country’s largest telecom operator Bharti Airtel last week announced the second quarter results that showed a decline in margins.

Company’s chairman Sunil Bharti Mittal has already expressed his reservations over the price and has pointed out that while the business needs huge investments and one has to commit billions of dollars, lower returns on investments would force consolidation in the industry.

When asked where the tariff war was headed, he said the outcome would become evident in the next few quarters. “We will have to wait for the outcome in the next two quarters to see if this model works,” he said.

Experts point out that while the crowded and price-sensitive market requires operators to offer low-priced services to defend their market share, such quick and deep reductions in tariff levels will hurt ARPU and margins.

The Indian mobile market continues to experience high subscriber growth. With urban markets already approaching saturation, most of the new subscribers are coming from highly price-sensitive rural and low-income urban segments.

Market watchers say tariff levels in India are already among the lowest in the world. In responding to these pricing tactics, operators are harming their own revenue growth.

Nokia to replace charger for one phone model

New Delhi, November 9
After detecting a manufacturing defect in a charger meant for Nokia 7210 handset, world's largest cell phone maker Nokia today announced an exchange programme for the charger in the Indian market.

Consumers who own the chargers manufactured by a third-party supplier are recommended to exchange these chargers for free, the company said in a statement.

Asked whether the company detected a major fault in these chargers, Nokia said, "During a routine quality control process, we identified a potential product quality issue with certain chargers manufactured by one of its third-party suppliers.

"The plastic covers of the affected chargers could come loose and separate, exposing the charger's internal components and potentially posing an electric shock hazard if certain internal components are touched while the charger is plugged into a live socket," the company said.

Nokia, however, asserted that no complaint has been registered so far globally or in India.

When contacted, Ambrish Bakaya, director, corporate affairs of Nokia India told PTI, "As a responsible corporate citizen, and the most trusted brand in India, we have pro-actively initiated this exchange programme to safeguard consumer interest." — PTI

Accenture to hire 8,000

New Delhi, November 9
Global technology and consultancy giant Accenture today said it is going to add around 8,000 people in India by the end of next year taking its total employee base in the country to 50,000.

"We are 42,000 right now and we imagine we will be about 50,000 by the end of 2010," Accenture chairman and CEO William D Green told PTI on the sidelines of the India Economic Summit.

Indicating a recovery from the global downturn, Green said the company would continue to focus in India, specially in the areas of analytics. — PTI

Stalemate continues over 3G spectrum auction
Tribune News Service

New Delhi, November 9
As the stalemate over the release of spectrum by the defence forces continues, there is a hope emerging for the auction of 3G spectrum with reports suggesting completion of most of the optical fibre cable network for the Indian Air Force by BSNL.

The network, built at a cost of Rs 1,000 crore, would connect 162 Air Force stations across the country.

Officials point out that rolling out of this network could pave the way for release of more spectrum by the defence forces, which are adamant that the additional spectrum would not be released till such time they are provided with an alternative network.

DoT had agreed to roll out the network as an alternative medium of communication for the defence in lieu of vacated spectrum. Another cable system for the Army and the Navy is also being planned as part of the agreement.

The total cost of the project is close to Rs 9,000 crore and will be completed in 2-3 years. The networks, for exclusive use by the three wings of the defence forces, was part of the agreement between the Ministry of Defence (MoD) and the Department of Telecom (DoT).

According to the MoU signed by the two sides, the defence will release 25 Mhz of 3G spectrum and 20 Mhz of 2G spectrum. Of this, it will immediately release 10 Mhz for 3G spectrum and 5 Mhz for existing 2G cellular services.

However, the MoD has now refused to vacate the spectrum which has put a big question over the auction of the 3G spectrum also putting on hold the advent of the next generation services in the country.

Telecom Minister A. Raja has already written to Finance Minister Pranab Mukherjee to help clear the decks for release of the spectrum.

The DoT had earlier written to the Cabinet Secretary seeking expeditious vacation of airwaves held by the defence forces so that the exact availability of 3G spectrum is known before the auction.

Earlier, the Cabinet Secretary had also held a meeting with the officials of the DoT and the MoD in an effort to end the stalemate.

The DoT had sought to complete the auction for the 3G spectrum, which has been hanging fire since last December, by the end of the year after the Empowered Group of Ministers (EGoM) headed by the Finance Minister, had in August last decided to auction four blocks of 5 MHz spectrum in those telecom circles where 20 MHz or more spectrum is available.

Shortage of hides hits leather industry
Bipin Bhardwaj
Tribune News Service

Jalandhar, November 9
The unavailability of raw hides in the state has forced the leather industry to go slow, leading to huge losses every month. The leather-manufacturing units have been running on almost half of their installed capacity in the absence of good quality of cattle skins in Punjab. The shortfall in the raw hides has prevented a majority of tanneries and fabrication units from operating at full steam.

The state government has turned a blind eye towards the problem even after setting up a huge Leather Complex here.

The complex, housing 117 tanneries, was set up under the Industrial Policy during 1992-97. The then government had lured entrepreneurs by offering a number of incentives, but nothing actually materialised and they were left to fend for themselves. The same situation continues even today.

According to a survey conducted by scientists of the Central Leather Research Institute (CLRI) regarding decline in the inflow of raw leather (skins/hides), it was found that area under grazing has reduced drastically in the state. The farmers were forgoing dairy farming by reducing their livestock since the younger generation does not want to take up agriculture and cattle farming as a vocation.

In addition to this, the male calves were starved to death in view of their limited utility as compared to female ones.

Talking to The Tribune, Lt-Col JS Paul (retd), president of Punjab Leather Federation (PLA), said the lack of organised farming in the state was major reason for the unavailability of good quality raw hides.

To meet the requirement of 2 lakh square feet per day, the entrepreneurs have been purchasing raw hides from states like UP, Jammu and Kashmir, Rajasthan and Gujarat, which is of poor quality.

He has suggested that the government should give incentives to farmers to rear calves of good quality so that the entrepreneurs don’t have to scout for hides from other states. At present, this practice is being followed in Europe, Australia and the USA, where the government gives 50 per cent subsidy to the farmers for raising male calves.

Paul said Punjab should also set up another slaughterhouse in the Doaba belt since all tanneries are located here. The lone slaughterhouse is in Dera Bassi, but all hides from this factory are exported. “This must stop immediately and the tanneries here should be allowed to use its leather,” he added.