New Delhi, October 11
The trade data continues to be worrisome as exports fell for the fifth straight month in September by over 10% and the trade deficit climbing to US $18 billion, the highest in last 11 months. India's exports declined by 10.78% to $ 23.69 billion in September as the slowdown in the developed markets persist.

However, imports grew by 5 per cent to $41.77 billion from $39.75 billion in September 2011, resulting in a very high trade deficit of $18 billion for the month. In the first six months of the fiscal, April-September, exports dipped by 6.79% to $143.6 billion from $154.1 billion in the same period last year. During the first six months of the fiscal, imports contracted by 4.36% to $232.92 billion. Trade deficit during the period stood at $89.25 billion.

Expressing his concern over falling exports, Apparel Export Promotion Council (AEPC) chairman A. Sakthivel said the rising cost of fuel and inflation were hurting exports. He added the biggest worry is the rupee’s appreciation to the extent of 10% and the high cost of funds.

Reacting to the trade data released for the month of September and for the first half, Federation of Indian Export Organizations (FIEO) president M. Rafeeque Ahmed said this was on expected lines because of the contraction in global demand.

He noted the World Trade Organization had also downwardly revised its forecast for the global trade for 2012 from 3.5 per cent earlier to 2.7 per cent. Most of the countries are facing decline in their exports on account of global contraction. He, however, expressed hope that exports would soon start picking up as the global situation improves slowly, adding the initiatives taken in the foreign trade policy would also help in bringing results.

Ahmed also said the cost of credit is still a cause of concern for the export sector and a general reduction in the interest rate would benefit manufacturing as well as exports.

New Delhi/Oslo, October 11
Norwegian telecoms group Telenor has dissolved a joint venture with Unitech, hoping to distance itself from a scandal over the award of operating licences and setting out a new plan to win business in the subcontinent.

Telenor said on Thursday it would set up a new entity through which it could bid for operating licences, after courts cancelled 122 regional operating permits held by eight carriers — including the Telenor/Unitech venture —granted in a scandal-tainted licensing round in 2008.

The move could make it easier for Telenor to continue doing business in India, although it still has decide whether to spend the billions of crowns required to buy back the lost licenses.

"Telenor is preparing to participate in the upcoming 2G spectrum auction through this new entity, but will take a final decision on whether to participate at a later date," the company said.

Telenor, which owned two thirds of the Uninor-branded venture with Unitech, had blamed the Indian company for the licence cancellation.

Unitech initially opposed the ending of the venture and had said it had veto rights to block any transfer of its assets, but has now agreed to sell its share of the venture for a nominal sum to the Norwegian group.

Telenor, which had threatened to exit India, has said it is in talks with several potential new partners in India and has given itself an October 18 deadline to decide whether to participate in the upcoming 2G auction, set to start next month. — Reuters

Mumbai, October 11
Suzlon Energy Ltd was set to default on redemption of more than $200 million in overseas convertible bonds due on Thursday after bondholders rejected a four-month extension, sending its shares down as much as 5 percent.

The world's fifth-largest maker of wind turbines was one of numerous Indian companies that rushed to tap the offshore convertible bonds market before the global financial crisis, often to finance overseas acquisitions.

Since then, many of the nearly two dozen Indian companies with nearly $6 billion in foreign currency convertible bonds maturing this year have struggled to meet their debt obligations due to a sharp plunge in share value, feeble earnings growth and a weaker rupee.

A total of $1.3 billion of convertible bonds are expected to come up for redemption in the Oct-Dec quarter, brokerage Kotak Securities said in a report last month.

"I regret to announce today that the bondholders' meetings did not achieve the consensus we were hoping for and the four-month extension sought by us has not been granted," Kirti Vagadia, CFO of Suzlon, said in a statement. "We expect an acceptable solution for all stakeholders will be arrived at the earliest possible."

Suzlon would not be the first Indian issuer to default on its overseas convertible bonds. In 2009, generic pharma maker Wockhardt defaulted on $110 million worth, although it has managed to restructure its debt and its stock has soared this year.

"It's not good," Tobias Bettkober, a Zurich-based manager of Indian convertible bonds with Holinger Asset Management, said of Suzlon's default. — Reuters

Mumbai, October 11
ICICI Bank has cut its floating rate on home loans by up to 100 basis points until December-end, the country's second-largest lender said on Thursday.

Under its new offer, ICICI Bank will now charge a floating rate of 10.25% on housing loans up to Rs 30 lakh instead of the 10.50% earlier.

For loans between Rs 30 lakh and Rs 3 crore the bank's floating rate is revised to 10.50%.

Earlier the private sector lender was charging floating rate of 11% for home loans between Rs 30 lakh and Rs 75 lakh, and 11.50% on loans above Rs 75 lakh.

Home loans above Rs 3 crore will continue to attract a 11.50% floating rate under the new offer.

Similar revisions have been made for home loans with a fixed interest rate for one and two years.

For a 3-year fixed rate home loan the revised interest is 10.50% for loans up to Rs 30 lakh, and 10.75% for Rs 30 lakh to Rs 3 crore loans. — Agencies

New Delhi/Mumbai, Oct 11
The Securities & Exchange Board of India has written to billionaire Vijay Mallya's United Spirits "with a set of queries" after it recently announced it was in talks to sell a stake to Diageo Plc, and the world's largest spirits company, a United spokesman said on Thursday, declining to specify the nature of the inquiry.

The queries from the capital markets regulator come after shares in United Spirits surged 23 percent in the four days leading up the September 25 announcement, jumping an additional 10 percent the day when the spirits maker disclosed the talks.

According to a media report on Thursday, SEBI was investigating stock price movements at UB Group companies to check whether securities laws had been broken, citing an unnamed senior regulatory official.

The Bangalore-headquartered liquor-to-airline UB Group controls India's dominant alcoholic spirits maker as well as the debt-ridden Kingfisher Airlines.

"We look at a lot of companies based on market movement and seek management's comments, but there is no formal probe yet (on UB)," a source at SEBI told Reuters.

United Spirits shares have been volatile through the year due to widespread speculation about the company's on-again, off-again courtship with Diageo, maker of Johnnie Walker whiskey. The volatility has come as Mallya has scrambled to raise funds for his ailing Kingfisher Airlines. — Reuters