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Food inflation soars to 19.95%
Gas at $2.34 will result in loss of $38 bn: RIL
Bourses defer advancing trading hours till Jan 4
Industry waking up to renewable energy sector
Telangana row hits textile industry in TN
S Tel launches operations in Himachal
Fed keeps key rates unchanged
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Food inflation soars to 19.95%
New Delhi, December 17 Prices of potato, other vegetables and pulses had driven inflation higher from the previous week's 19.05 per cent. "Food prices are going up and this is an area of concern ... we have to take appropriate measures to see what best could be done by augmenting the supply through imports," Finance Minister Pranab Mukherjee told reporters even as a Parliamentary committee pulled up his ministry for not taking timely action to check price rise. Rising inflation may force the Reserve Bank of India to withdraw easy money policy in January review of the monetary policy and jack up policy rates and ratios to withdraw liquidity from the system. Despite easing of import restrictions by the government to augment supplies, food inflation soared to close to 20 per cent, driven by pulses, milk, wheat and rice, besides costlier vegetables, including potatoes. On an annual basis, potato prices zoomed 136 per cent and pulses became costlier by over 40 per cent. Onion prices rose 15.4 per cent. Other food items that became dearer include wheat 14 per cent, milk 13.6 per cent, rice 12.7 per cent and fruits 11 per cent. Food price inflation was triggered by a short supply of essentials owing to lower farm output following drought and floods in many parts of the country in the year. While pulling up the finance ministry on rising prices, the Standing Committee on Finance in its report called upon the government to take immediate steps to provide relief to the common man. Besides other things, it asked the government to amend the Essential Commodities Act to check hoarding and speculation. "The Ministry of Finance...has obviously failed to intervene timely and squarely address this burning issue (price rise) with due seriousness," it said. The comprehensive wholesale price inflation, which includes manufactured products in addition to food and fuel items, rose to 4.78 per cent in November from 1.34 per cent in October. "By the end of March 2010, it (inflation) could be close to seven per cent," Prime Minister's Economic Advisory Council chairman C Rangarajan had said earlier this week. "We need to watch for behaviour of prices in December... possibly some action will be taken (by the RBI), which can have a moderating effect (on inflation)," said Rangarajan, a former Reserve Bank governor. The RBI, which keeps a close watch on inflation and growth, is slated to come out with third quarterly review of monetary policy on January 29, 2010. The central bank had already raised the fiscal-end inflation forecast to 6.5 per cent from 5 per cent earlier. — PTI |
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Gas at $2.34 will result in loss of $38 bn: RIL
New Delhi, December 17 Arguing before the special Bench headed by Chief Justice KG Balakrishnan, senior counsel Harish Salve said RIL had borrowed about $6 billion on an average interest of 10 per cent. The interest alone would work out to $4 billion, taking the loan burden to $12 billion. Thus the net return would be only $1.8 billion on an investment of $12 billion. In other words, the return would constitute a mere 2.6 per cent, which was much below the cost of borrowing. If $12 billion was invested in a bank at an interest rate of 8 per cent a year, it would yield $1.8 billion in just two years and $40 billion in 19 years. How RIL could be expected to make an investment of $12 billion and take all the risks for a return of $1.8 billion after subsidising RNRL to the extent of $ 6.3 billion, he asked. At the same time, RNRL would not pass on the subsidy to the power consumers and instead make huge profits at the cost of RIL, he said. Rebutting RNRL’s argument that 28 mmscmd claimed to be supplied represented just one per cent of the gas exploration, Salve said it would in fact work out to 35 per cent of the country’s aggregate gas production prior to the commencement of Krishna-Godavari D-6 production and 35 per cent of peak production from KGD-6.“It is also more than 50 per cent of the current production of gas by ONGC.” On another RNRL stand that non-supply of gas by RIL would render RNRL’s power projects non-bankable, he said, there was no evidence, whatsoever, to show that financing of any power project was declined because gas supply arrangement was considered to be non-bankable. Arguments in the case are slated to conclude tomorrow. |
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Bourses defer advancing trading hours till Jan 4
Mumbai, December 17 A joint statement issued by the BSE and the NSE said the earlier announcements made by them to begin trading from 9 am with effect from Friday has been postponed. The existing practice of the market functioning from 9.55 am to 3.30 pm would continue for the time being, the joint statement said. According to sources, the one-upmanship by both exchanges to advance trading hours drew the attention of the Security Exchange Board of India which asked representatives of both exchanges to sit together and formulate a joint strategy. Broking houses were also vociferous in their opposition to increased trading hours on the grounds that they did not have adequate infrastrucuture to cope with the higher work load. It all began on Tuesday when the Bombay Stock Exchange unilaterally announced that it would be advancing market hours by 10 minutes to 9.45 am. On Wednesday night, the NSE announced that it would bring forward trading hours to 9 am from Friday onwards. The BSE immediately followed suit but said it was doing under pressure from its competitor. As the news sank in, brokers and other market intermediaries came up with a number of objections, including inadequate support from banks. The RTGS clearance system of the banks, one argument went, begins functioning only from 9.45 am and thus it would not be possible for High Net Worth Individuals to transfer funds to purchase shares at market opening. |
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Industry waking up to renewable energy sector
Chandigarh, December 17 Be it electronic goods manufacturers or financial institutions, everyone is now joining the bandwagon to get the early bird benefit. With the Government of India as well as different state governments giving a huge push to this sector, things are finally looking up. Talking to TNS, Zubin Irani, managing director of Carrier India, which is into refrigeration and air conditioning solutions, says they have not just taken a lead in providing energy efficient appliances, but are also involved in creating awareness on energy conservation. “In 2008, more than 80 per cent of our products were BEE (Bureau of Energy Efficiency) labelled. Even before the government made it mandatory for all air conditioners and refrigerators to be star labelled in January 2010, we had already achieved the target. Of the 52 green buildings that have been recognised by BEE, we have provided end-to-end solutions in many buildings,” he says. With various financial institutions coming to the rescue of those developing such technologies, more research and development is now being done in this field. SK Pawar, AGM, resident representative of EXIM bank, says banks are now making efforts to finance these projects. “We have recently entered into a framework agreement with European Investment Bank under which we have been given a $150 million credit line, which now has to be used in the next three years. We are already in talks with several companies to finance their projects,” he says. Venkittu Sundaram, managing director, Epuron Renewable Energy, however says the biggest challenge was skilled manpower shortage. “It’s time that the IITs and IIMs should set up special environment chairs, so that quality professionals can be churned out. Since most renewable energy products require a lot of land to be set up, the government should demarcate land in different areas where such projects can be set up. For example, north India is good for setting up hydel and biomass products. India has a huge potential to develop end-to-end solutions in different renewable technologies, which can be exported after economies of scale are achieved,” he says. |
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Telangana row hits textile industry in TN
Chennai, December 17 Travel through Hyderabad, a major transit point for northern and eastern states from South India, has become impossible following agitations in different places and the truckers and mill owners are facing huge losses. As many as 100 trucks loaded with readymade apparels head for the northern part of the country from Palladam, Somanur and Tirupur in western Tamil Nadu everyday with each truck carrying goods weighing between 8 and 16 tonnes. The recent developments over Telangana has brought vehicular movement to a grinding halt in different parts of Andhra Pradesh. Trucks were neither able to enter nor move away from the Hyderabad highway. Traffic has been completely disrupted in the interior parts of Ananthapur, Chittor, Cuddapah, Nellore and Tirupati districts and in other places movement of vehicles has been delayed for hours in view of agitations and road blocks. The timing of the agitations has also hit the textile industry, as it comes when Christmas and New Year are approaching. At this time, readymade products are sold like hot cakes in Andhra Pradesh and eastern India and obstruction of trucks traffic will result in heavy losses for mill owners. The truck owners also fear that the formation of Telangana would mean that they should spend money in getting permits, since they would have to cross two states, instead of one. The amount for getting permits would be double, said Nallathambi, president of State Lorry Owners Federation of Tamil Nadu. Transport corporations are incurring heavy losses as they are forced to maintain only skeletal services. Passengers, too, are severely affected, since they are compelled to rely on train services. |
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S Tel launches operations in Himachal
Shimla, December 17 The company has started services in nine of the total 12 districts, barring Chamba, Kinnaur and Lahaul-Spiti, after setting up as many as 500 cell sites in the state to provide seamless connectivity. It will cover 50 census cities and towns, 705 non-census towns and 7,322 villages, providing services to 63 per cent of the state’s population. It also came out with some innovative tariff plans under which customers could avail free talk time for an hour even on day-to- day basis. The price of the sim card has been kept as low as Rs 13 and the call rate to any network will be one paise per second and 50 paise per minute. Chief operating officer Balwinder Chawla said the company hoped to create a customer base of one lakh by the end of the current financial year. |
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Fed keeps key rates unchanged
Washington, December 17 The apex bank's move to stick with key interest rates in the range of 0 to 0.25 per cent comes in the backdrop of the American economy showing early signs of revival, especially the labour market. In a statement on Wednesday, the Federal Open Market Committee, the body which decides on the country's monetary policy, said "economic activity has continued to pick up and that the deterioration in labour market is abating". According to the Fed, the exceptionally low interest rates would remain for a longer time. "(The committee) continues to anticipate that economic conditions, including low rates of resource utilisation, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels of the federal funds rate for an extended period," the statement noted.
— PTI |
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