The Tribune, Chandigarh, India

	Region does not see 8% growth Ruchika M Khanna Tribune News Service Chandigarh, September 12 With interest rates having risen almost 2 per cent in the past one year (industry is now paying 14.5 per cent rate on interest) and cost of raw material also rising — a majority of industry representatives, across Delhi, Uttar Pradesh, Uttarakhand, Rajasthan, Haryana and Punjab have said that they do not see economic growth at over 8 per cent this fiscal. This is the crux of a CII report released today that says that over 60 per cent of the industry representatives do not see GDP above 8 per cent. Around 10 per cent even say growth could be below 7 per cent. Presenting a gloomy picture of the overall outlook of economy, this survey found that rising interest rates and high raw material cost is largely responsible for this poor show and that the government needed to address these issues on priority. “Only 31 per cent of the respondents expect an increase in capital investment in the current three months as against 47 per cent in previous survey which indicates a likely moderation in the investment activity,” it said. Kamna Raj Aggarwalla, president, Punjab state council, CII, said that rising interest rates had already had an adverse impact on investment. “The CII Survey shows that 89 per cent of respondents have not increased their investment due to rising interest rates. There is a definite stagnation in industrial output, and the government will have to revise interest rates so as to make finance viable for industry to grow," she said. A L Aggarwal, general secretary of the Haryana Chamber of Commerce and Industry, and a member of CII, said that a number of industrial units, especially in SMEs, were finding industrial production unviable and were sitting idle. The CII survey showed that only 40 per cent of the respondents surveyed this year, expect teconomic growth to be more than 8 per cent. — PTI
	Suzuki seeks divorce from Volkswagen over Fiat spat Tokyo, September 12 Suzuki Motor wants to end its two-year-old alliance with Volkswagen after the German carmaker accused it of violating their partnership pact by agreeing a diesel engine deal with Italy’s Fiat. An exit by Suzuki would end an alliance forged in December 2009 that was billed as a partnership of equals to bolster VW’s presence in India for small cars and give Suzuki access to hybrid and diesel technology it could not afford to develop on its own. Suzuki chairman and CEO Osamu Suzuki on Monday offered to buy Volkswagen's 19.9 percent stake in his company with cash on hand, and in return, promised to offload its 1.5 percent stake in Volkswagen back to its estranged German partner. VW bought its Suzuki stake for 1.7 billion euros ($2.3 billion) in 2009 as part of a strategic partnership with the maker of the Jimmy and Grand Vitara. The holding is now worth around $2.2 billion, while Suzuki's VW stake is worth about $950 million. The move comes after two months of squabbling between the two companies, with Suzuki accusing VW of wanting to bring the Japanese company under its control and VW trying to make amends by promising it would not encroach on Suzuki's independence. It is the second setback for VW in as many weeks after it had to push back a planned merger with Porsche beyond the end of 2011 because of legal issues. The partnership with Suzuki has so far been beset with problems and failed to deliver any meaningful progress for either company. "We don't have any projects in the works from the alliance," Suzuki's chairman said at a press briefing in Tokyo. "We will try to ensure an harmonious parting," he added. In a separate statement, VW said it had no intention of selling the shares and asked that cooperation between the two continue. Analysts said they believed that VW would not have a choice in the matter. "As Suzuki has already offered a termination of the cooperation we can't really see VW moving ahead with the alliance or even increasing its grip on Suzuki and thus forcing the company into a deeper cooperation," Munich-based UniCredit analyst Christian Aust said. Suzuki said it plans to accelerate vehicle development on its own. "I don't think there is any immediate impact, but over the long term, this could be a big problem because to develop very good or efficient diesel or hybrid (electric vehicle) by itself is going to cost the company (Suzuki) an enormous amount," said Koji Endo. — Reuters
	Gold seen snapping 2-week gains Mumbai, September 12 Gold futures in India are likely to ease this week, snapping its two-week gaining streak, as investors resort to profit-taking after a record rally, analysts said. The most-active gold for October delivery on the Multi Commodity Exchange (MCX) was trading 0.25 percent lower at Rs 28,082 per 10 grams at 4:28 p.m., reversing from its record of Rs 28,744 on Sept. 6. The contract has gained about 22 per cent from Aug. 1. Overseas gold fell as investors sold holdings to raise cash, following last week's rise to record highs, in order to cover losses elsewhere, including European equity markets pummelled by growing fears about the intensifying debt crisis. "We are having a bearish view on gold this week. We have seen low volumes at higher levels," said Subhrasom De, an analyst with Karvy Comtrade, said. Selling is advised at Rs 28,500 for a target of Rs 27,000 said De. Fears about a Greek default rose last week after senior politicians in German Chancellor Angela Merkel's centre-right coalition started talking openly about it. Greece, meanwhile, confirmed on Monday that it had cash for only a few more weeks. Physical gold sales from traders in India, who sought to stock up for the ongoing festival season, could limit the downside in prices, analysts said. India, which consumes about 800-900 tonnes annually, is the world's biggest bullion buyer followed by China. Silver futures are likely to track lower gold prices, analysts said. Silver for December delivery on the MCX was 0.52 per cent lower at Rs 64,820 per kg. — Reuters Selling could be done at Rs 66,050 rupees, for a target of Rs 64,000/63,200 , said Karvy's De.
	Govt relaxes FII investment rules in long-term infra debt New Delhi, September 12 India has relaxed rules for foreign institutional investments in long-term infrastructure corporate bonds to attract more foreign funds into the sector, a finance ministry statement said on Monday. In its budget, the government raised by an additional $20 billion, to $25 billion, the limit on foreign institutional investment in corporate bonds of duration longer than five years issued by infrastructure companies, with a minimum lock-in period of three years. Foreign institutional investors (FIIs) can now buy upto $5 billion in long-term infra bonds which have an initial maturity of five years or more at the time of issue with a residual maturity of one year at the time of first purchase by such investors, with a lock-in period of one year. FIIs can trade amongst themselves but cannot sell to domestic investors during the lock-in period of one year. In August, Qualified foreign investors, or QFIs, were allowed to buy $3 billion of debt funds that invest in at least 5-year infrastructure-related debt, the country's capital market regulator, Securities and Exchange Board of India (SEBI) said. The$17 billion limit will be available to FIIs for investing in long-term infra bonds which have an initial maturity of five years. — Reuters
	RBI gives free hand to banks for SME revival Mumbai, September 12 The Reserve Bank of India today asked banks, barring regional rural banks, to chalk out a restructuring and rehabilitation plan for revival of sick micro small enterprises (MSE). "Banks are advised to put in place their own board- approved restructuring and rehabilitation policy for revival of viable or potentially viable sick MSE units or enterprises," RBI said in a circular today. With this, the central bank withdrew its earlier notifications that directed commercial banks to stick to the guidelines for revival of a sick SSI unit. It maintained that commercial banks can lend below base rate in case of a restructured loan of a sick SSI unit. "In case of restructured loans if some of the WCTL (Working Capital Term Loan) and (Funded Interest Term Loan) need to be granted below base rate for the purpose of viability, such lending by scheduled commercial banks will not be construed to be a violation of the guidelines,"it said. — PTI
	Plan panel against CAG scrutiny of PPP projects New Delhi, September 12 The Plan Panel is against Comptroller and Auditor General of India’s (CAG’s) scrutiny of the role of private sector players implementing the Public Private Partnership (PPP) projects running into thousands of crores. “The performance of the public part of the (PPP) project should be subject to proper scrutiny but obviously where the private sector (is given) flexibility ... you cannot subject that to CAG scrutiny,” Planning Commission Deputy Chairman said when asked whether there is case for CAG scrutiny of PPP projects. A Bill seeking to expand the scope of the CAG to scrutinise PPP projects besides regulators, including SEBI, TRAI and IRDA, is under consideration of the Finance Ministry. The Bill, which seeks to replace the CAG Act, 1971, is likely to be tabled in forthcoming winter session of Parliament. Under the PPP mode, the project is implemented based on a contract or concession agreement between a government or statutory entity on the one side and a private sector company on the other side, for delivering an infrastructure service on payment of user charges. Besides opposing the CAG scrutiny of private players under PPP projects, Ahluwalia also did not subscribe to the idea of bringing them under ambit of Right to Information Act. — PTI
	Japanese keen to invest in Haryana Chandigarh, September 12 The Haryana government today said the India-Japan Partnership Summit 2011, held in Tokyo recently, helped the state showcase opportunities for investment as Japanese investors showed keen interest in investing in the state. Haryana Chief Minister Bhupinder Singh Hooda had led a high level official delegation to the Summit last week. The Chief Minister during his meeting with the Japanese Prime Minister, Yoshihiko Noda, invited Japanese SMEs to set up units in Haryana. On the sidelines of the summit, Hooda discussed investment proposals with Osamu Suzuki of Suzuki Motor Company and representatives of Panasonic and Mitsui, An official spokesman told reporters here. He also met senior officers of the Tokyo Metropolitan Government led by Masao Nakayama, Senior Director, International Affairs. The state Industries Minister Randeep Surjewala, who accompanied Hooda, apprised the Japanese investors of the opportunities in various initiatives of the Haryana Government, especially in the Delhi-Mumbai Industrial Corridor (DMIC) project, During the Chief Minister's visit, MoUs for technical collaboration were signed between various companies based in Haryana and Japan. Japanese major Aisin Seiki evinced interest in setting up a project in Haryana for the manufacture of auto parts. The company plans to set up the plant over 50 acres at Rs 700 crore. — PTI
	MCX gets regulator’s nod for IPO Mumbai, September 12 India’s Multi Commodity Exchange (MCX), the country's biggest commodity bourse by turnover, plans to list "sooner rather than later," after it got a regulatory nod for an initial share sale, a top executive said on Monday. “We will try to do it sooner rather than later. At the same time there is no financial pressure on us as it is secondary,” said Lamon Rutten, managing director, chief executive, MCX. MCX, which will be the first Indian bourse to list shares on an exchange, will sell 6.43 million shares constituting a 12.6 per cent stake in the company through the IPO, chairman Venkat Chary had said in March. Promoter Financial Technologies will sell a 5.18 percent stake, while State Bank of India will sell a 4.14 per cent stake. — PTI