Mumbai, December 12
The Bombay Stock Exchange Sensex slipped 2.12 per cent to a two-week closing low on Monday after a sharper-than-expected fall in the country's October industrial output compounded concerns over slowing economic growth.

The 30-share benchmark index closed 343.11 points down at 15,870.35, its lowest closing level since November 25. All but three of its components declined. The index fell as much as 2.3% during the day. Reliance Industries, which has the heaviest weight on the benchmark index, led the losses and closed 3.73% lower at Rs 727.50.

The 50-share NSE index fell 2.1 per cent to 4,764.60

"The fear is now turning into reality...The data shows that the India growth story is perhaps just a story," said Jagannadham Thunuguntla, research head at SMC Global Securities.

Industrial output fell for the first time in more than two years in October as waning consumer demand took a toll. The output plunged by 5.1 percent, far worse than a median forecast for a 0.5 percent drop in a Reuters poll.

"The mood is changing for worse," said Arun Kejriwal, strategist at research firm KRIS, adding signals from the domestic economy or overseas were not encouraging.

The Sensex has fallen more than a fifth this year and is one of the worst performing markets in the world. In the broader market, there were almost 4 losers for every gainer on a total volume of 500 million shares. — Reuters

Paris, December 12
Leading indicators all point to a slowdown in the world's major developed economies, OECD said Monday.

The composite index of leading indicators, designed to highlight turning points in performance, "point to a slowdown in economic activity in all major economies but with some variation" in individual countries, it said in a regular monthly report for December.

Indicators for the United States, China and Canada "continue pointing to slowdowns in economic activity around long term trends but with only marginal declines compared to last month," the Organization for Economic Cooperation & Development said.

For Japan and Russia, indicators suggest activity above long-term trends but with signs now of slowing.

Indicators for the 17 nation eurozone as a whole, France, Germany, Italy, Britain, Indian and Brazil "continue pointing strongly to economic activity falling below long term trend," it added.

Meanwhile, the euro and European stocks fell on Monday as a landmark move toward deeper economic integration at last week's European Union summit failed to convince investors its sovereign debt crisis would not continue to deepen. — AFP, Reuters

Mumbai, December 12
The Indian rupee can slide further and touch a level of Rs 58 a dollar in the near-term if the economic condition deteriorates in the Eurozone economies, top banking officials of HSBC Bank said Monday.

"The rupee is likely to depreciate further and touch a level of Rs 58 against the US dollar in the near-term if the eurozone nations don't find a credible solution to their debt woes," HSBC Bank India and ASEAN chief economist Leif Eskensen said here.

He also said the domestic currency would slide also due to high inflationary environment, and a possible slowdown in the GDP growth. "This will happen despite intervention by the Reserve Bank of India," he said without giving any specific timeframe.

The rupee, which touched an all-time low of Rs 52.73 against the dollar on November 22, has plunged around 15% in 2011 as investors seek safe haven option in the US treasury papers and its currency. The RBI has intervened in the forex market by selling dollars to check this volatility. As per a Citibank estimate, RBI is believed to have pumped in around US $3 billion on Sunday.

The officials from the bank also said inflation and slipping fiscal deficit numbers could prove tricky for the domestic economy in the wake of ongoing sovereign debt crisis in Eurozone.

"Inflation is a much serious problem for the domestic economy in comparison to other emerging countries and it is still not under check despite monetary squeezing," Eskesen said.

The HSBC officials, however, said that India is a domestic consumption driven growth story and would not be impacted as much as the export driven economies of the world. — PTI

New Delhi, December 12
The standoff between the department of telecommunications (DoT) and some of the country’s top telecom operators over the 3G roaming pacts is likely to go further with the former saying on Monday such pacts were not permissible and it would soon take action against the operators.

DoT, which is of the opinion that the pacts violate the licence norms and conditions, is likely to penalise the operators. The indication on this came from telecom secretary R Chandrashekhar who, while talking to reporters on the sidelines of an industry function, said DoT had received the views of the law ministry, among others, on the matter.

"The broad view that is emerging is that it is impermissible”, he said. He added the ministry would soon take action but declined to give further details.

The views expressed by Chandrashekhar are further likely to fuel the confrontation between the operators and the ministry as the former has already threatened to return 3G spectrum while seeking the return of the money paid by them to get the airwaves.

The chiefs of three leading telecom firms — Bharti, Idea and Vodafone — had then sought Prime Minister Manmohan Singh's intervention in the dispute over the 3G roaming pacts, failing which they said they would surrender spectrum. Singh, on his part, had assured the industry the government would look into their concerns and formulate “forward looking” policies to sustain growth in the sector.

The issue pertains to the pact between major service providers, including Airtel, Vodafone Essar and Idea Cellular, for providing a 3G roaming network on a pan-India basis. Other service providers, like Tata Teleservices and Aircel, had also entered into a similar agreement to offer services in six circles.

DoT had also sought a legal opinion on this matter.

New Delhi, December 12
The government would deregulate diesel and liquefied petroleum gas (LPG) prices only after considering their impact on the weaker sections of the society, minister of state for petroleum & natural gas RPN Singh said on Monday.

"We as policy makers and politicians have to mediate between the social, economic and environmental attributes of energy. We’ve to move cautiously to ensure that our decisions are equitable and lead to balanced growth," said Singh, addressing the 10th Petro India conference here.

While the government had in June last year decontrolled petrol prices, it continues to dictate retail rates of diesel, cooking gas (LPG) sold to households and kerosene sold through the public distribution system (PDS).

The minister said while the government was protecting consumers, it had to shield the state-run oil and gas marketing companies from the impact of selling subsidized products.

"We import about 75 per cent of our crude requirement from overseas. The government therefore has the huge responsibility of protecting not only consumers but also our major oil and gas companies," Singh said.

Singh said there was a need to target subsidies directly to the weaker sections of the society in the case of cooking gas.

"While certain subsidies may be necessary in view of the larger social objectives, they need to be administered directly to specific targeted end-users and provided in a transparent way through clear budgetary mechanism," he added.

The minister also urged well-to-do sections to give up subsidized LPG voluntarily.

The government in the current fiscal will have to bear a energy subsidy burden of more than Rs 180,000 crore, which might increase due to a depreciating rupee.

Singh said there was a need to carry out energy pricing reforms across the segment of petroleum and gas products in order to attract investment and technology in the sector.

"Energy pricing reforms need to be carried out across the entire energy basket rather than segments of it so that there is neither inter-sectoral nor intrasectoral crosssubsidization”, he added. — IANS

New Delhi, December 12
Even while the entire opposition, as also some key UPA allies, are clamouring for a “no-FDI” regime to “save” the country and its farming sector, a group of farmers under CIFA met Prime Minister Manmohan Singh on Monday, requesting him to allow foreign investment in the retail sector, and that too before December 31.

Claiming to be speaking on “behalf of farmers of India”, the Consortium of Indian Farmers Association (CIFA) conveyed its “grateful thanks” to the PM and his cabinet colleagues for taking the “extraordinary and bold step to allow FDI in retail”. The letter, signed by CIFA representatives from across the country — Satnam Singh Behru, P Chengal Reddy, K Shanta Kumar, V Nagendra Nath and Gurmail Singh —then went on to explain how Indian farmers, dependent only on “dalal, adithiya/commission agents system” for marketing their produce would benefit by establishment of producer groups and forward-backward linkage between farmers and retailers.

Reddy later told The Tribune Singh was “sensitive” toward the problems flagged by them. “He (PM) agreed that there were serious problems in the farm sector. He said he wanted to initiate a lot of measures but it required political consensus. He told us he would do his best to sort out the issues raised by us,” he said.

Arguing the case for FDI in retail, CIFA representatives said it would be helpful to farmers by establishing producer groups.

BRIEFLY

SSTL Q3 net loss doubles: Sistema Shyam TeleServices Ltd (SSTL), which operates under MTS brand, posted a net loss of Rs 1,009.7 crore for Q3 ended Sept 30 as compared to a net loss of Rs 494 crore in July-Sept 2010.

Airtel awarded TCOE 2011: Telecom major Bharti Airtel has been awarded the Telecom Centre of Excellence Award (TCOE) for service provider with customer focus for best delivery of network services for the year 2011. The evaluation criteria was primarily focused on network quality of service KPIs, network coverage and product innovation.

Belkin India to expand base: Belkin India, a leading computer hardware manufacturer that specializes in connectivity devices, plans to reach out to more cities and towns and across more product categories.