New Delhi, January 1
The quality of governance, inflation and the government's fiscal situation will remain the key differentiators in 2013 between India managing to cope up with the global slowdown and further erosion in the economic growth, an Assocham report said today.

The report based on inputs from economists and industry leaders, does not see any turnaround in the economy in the short-term, as uncertainty in the US and Europe has only increased denting the investor confidence worldwide.

While the Assocham report on the 2013 economic situation does not see India's growth exceeding six per cent in the current fiscal, it may not exceed 6.2-6.5 per cent even in FY14.

Despite some optimistic views on the downslide having bottomed out, Indian economy is still grappling with the key problems of high inflation and high interest rates, lack of investor confidence and a terrible situation for exporters, it said.

"Under these circumstances, it is the quality of governance and the political leadership which only can make a big difference," Assocham president Rajkumar Dhoot said.

The report lists the limitations of the government to do any pump-priming to boost the consumer demand in terms of reducing taxes on individuals or the industry. The fiscal situation is almost on the precipice leaving little room for Finance Minister P Chidambaram to revive the industrial and consumer demand in the coming Budget.

With the fiscal deficit crossing 80 per cent of the budgeted for the entire year in the first eight months of the current financial year and the current account deficit widening to 5.4 per cent of the GDP in July-September quarter, signals about the state of government finances are not quite comforting.

The balance of trade with China, the Asian powerhouse, has to be corrected and our exports must equal or at least near-equal to imports from China. Despite some slowdown the Chinese economy continues to grow raising the global demand for commodities, the report said.

Back home, it would take at least another 18 months before we can expect a complete turnaround, that too if the global situation improves.

Mumbai, January 1
Relaxing debt allocation norms for foreign institutional investors (FII), Securities Exchange Board of India (SEBI) on Tuesday allowed those overseas entities having acquired debt investment limits in the past one year to re-invest up to half of their maximum debt security holdings during 2013.

The FIIs need to acquire investment limits in debt securities by bidding in a period auction conducted by SEBI.

Earlier in November 2012, the market regulator had allowed FIIs to re-invest 50 per cent of their debt holdings from the previous calendar year to the succeeding calender year with effect from January 1, 2014.

In a part-modification of this circular, SEBI has now allowed certain FIIs to re-invest up to 50 per cent of their maximum debt holdings at any point of time in 2013 itself.

These FIIs would be those which purchased debt investment limits during 2012 and did not hold any debt investment limits prior to that.

“In order to provide operational flexibility to those FIIs/ sub-accounts which did not hold any debt investment limits as on January 03, 2012 and purchased debt investment limits thereafter, it has been decided that they shall be allowed a cumulative re-investment facility to the extent of 50 per cent of their maximum debt holding at any point of time during the calendar year 2013," SEBI said.

The re-investment facility would be available during each calendar year to those FIIs which hold debt investments as on December 31, 2012.

It further noted that the re-investment facility for those FIIs having debt limit prior to the beginning of 2012, would remain available till December 31, 2013.

The re-investment period of five working days for the government debt and 15 working days for the corporate debt would remain the same.

At the end of 2012, FII have invested around Rs 35,000 crore ($6.64 billion) in the debt market. —PTI 

New Delhi, January 1
The lure of huge discounts on various models being offered by the car manufacturers has not had much effect on the sluggish industry with the car sales remaining flat during the year-end.

The prevailing unfavourable conditions, with high interest rates and fuel prices coupled with the onset of the New Year, have seen most car manufacturers seeing just a marginal rise in sales while others seeing a major decline.

While the country’s largest car manufacturer, Maruti Suzuki India Ltd (MSIL) did not announce its monthly sales figures as it restarted work only on Tuesday after a week-long annual maintenance shut down.

Hyundai Motor India Ltd (HMIL), the country's second largest car manufacturer and the largest passenger car exporter recorded a 4.7% jump in domestic sales for the entire year with the domestic sales in December down 9.6 per cent at 26,697 units as compared to 29,516 units sold in same month last year.

The company recorded an 8.2 per cent increase in the exports with the cumulative sales down 2.5 per cent.

Toyota Kirloskar Motor (TKM) sold 12,071 units in December 2012 as compared to 15,948 units in the corresponding month in 2011, recording a decline of a massive 24 per cent . The company registered a cumulative growth of 27 per cent with 172,241 units being sold in 2012 as compared to 136,150 units being sold in 2011.

Commenting on the sales performance for 2012, Sandeep Singh, deputy managing director and COO, Marketing and Commercial said "Though we are satisfied with the overall growth in our sales volume of last year. The passenger car market continues to be slow, as has been in the last few months. We hope the New Year will usher in good times again with economic revival and better market sentiments.

Mahindra & Mahindra Ltd said there had been a 6 per cent jump in its auto sales numbers, which stood at 45,297units during December 2012 as against 42,761 units during December 2011.

The company's domestic sales stood at 42,307 units during December 2012, as against 39,891units during December 2011. The passenger vehicles segment registered a growth of 18 per cent, having sold 22,761 units in December 2012, as against 19,341 units during December 2011.

Hit by the Tsunami last year, Japanese auto major Honda Cars India Ltd said it registered an increase of 296% in domestic sales with 4,242 units during December 2012 as against 1,072 units sold during the same period last year

On the two-wheelers side, Hero MotoCorp Ltd (HMCL), the world's largest two-wheeler manufacturer, saw a marginal rise in its sales with 5,41,615 units of two-wheelers being sold in December. The company had sold 540,276 units in the corresponding month last year.

New Delhi, January 1
The government on Tuesday slashed the import tariff value of gold and silver marginally to $539 per 10 gm and $979 per kg, respectively, amid volatile movement in the global prices of precious metals.

The tariff value, which is released fortnightly, is the base price on which the customs duty is determined to prevent under-invoicing. During December, the tariff value of gold was $550 per 10 gm, while silver was $1,062 per kg.

The Central Board of Excise and Customs (CBEC) on Tuesday issued a notification in this regard.

Apart from precious metals, the government has reduced the import tariff value of RBD palmolein and poppy seeds to $835 per tonne and $4870 per tonne, respectively.

Last month, the tariff value of RBD palmolein stood at $872 per tonne, while poppy seed stood at $5,346 per tonne. However, the tariff value of brass scrap was increased to $4,090 per tonne from $4,069 per tonne.

The government decided to reduce the import tariff value of precious metals following volatile price trend in the international market.

In New York, precious metals have been seesawing in the past few days. Gold that ruled lower at $1,640 per ounce has risen to $1,680 per ounce and currently ruling at $1675.20 per ounce. Similarly, silver prices were in the range of $29-30.8 per ounce.

However in the national capital, the precious metals remained firm. Gold rose by Rs 155 to Rs 31,145 per 10 gm, while silver by Rs 740 to Rs 57,740 per kg on Tuesday.

Traditionally, India has been the world's largest consumer and importer of gold. However, doubling of the excise duty to 4 per cent in the last budget and the curbs that the RBI imposed on gold loan value (down from 85-90 per cent of the value of jewellery to 60 per cent) and banning banks from funding gold purchase by loan companies have led to sharp drop in imports this year.

In April-October, the gold imports declined 35 per cent on a year-on-year basis and overall imports is set to drop over 17 per cent to 800 tonnes this year.— PTI

New Delhi, January 1
The government has initiated the process of appointing merchant bankers for managing the 12.5 per cent stake sale in Rashtriya Chemicals and Fertilisers (RCF).

Merchant bankers will have to put in the bids by January 15 for managing the share sale of RCF, the Department of Disinvestment (DoD) has said.

Last week, the Cabinet had cleared the 12.5% government stake sale in RCF through the offer for sale (OFS) or auction route. The bidders must have prior experience in managing OFS.

The government holds 92.5% stake in RCF and the paid up capital of the company is Rs 551.69 crore.

At the current market price of the Rs 55.25 a share, the 12.5 stake sale could fetch around Rs 350-360 crore to the exchequer.

The stake sale approval is part of the government’s decision to raise Rs 30,000 crore through disinvestment in the current fiscal.

So far in 2012-13 fiscal, the government has raised over Rs 6,900 crore through minority stake sale in PSUs. The government has already identified 10 companies, including NTPC, Oil India, MMTC, SAIL, BHEL, for disinvestment. The stake sale of OIL is likely in January, followed by NTPC in February. — PTI