The Tribune, Chandigarh, India

	Rupee’s decline Reforms must to tackle structural issues: Experts Mumbai, August 28 As Indian economy grapples with the free fall of the rupee against the US dollar, a record high current account deficit (CAD), growing fiscal pressures, and slowest growth in a decade, analysts today pitched for reforms to tackle structural issues. The Indian rupee slumped to a record low near 69 to the dollar on Wednesday on growing worries that foreign investors will continue to sell out of a country facing stiff economic challenges and volatile global markets. The rupee had closed on Tuesday at 66.24/25. An assault on the psychologically key 70 level now appears imminent, as intervention from the central bank seen mid-morning only gave the rupee a brief respite. In the stock market, state-run Life Insurance Corporation, which was spotted buying shares, allowed the domestic benchmark index to erase steep early losses and end the day stronger. "If steps are not taken to implement the reforms necessary to tackle the structural issues, the government will be left with the so-called '3D options': debt default, devaluation, deflation," said Angelo Corbetta, head of Asia equity for Pioneer Investments in London. "In India, devaluation is happening now and deflation could be about to start. The good news is that the debt default is highly unlikely." Foreign investors have sold almost $1 billion of Indian shares in the eight sessions through Tuesday —a worrisome prospect given stocks had been India's one sturdy source of capital inflows in the first half of 2013. If more foreign investors throw in the towel, traders fear it will put the country in a vicious cycle in which the hit to confidence in turn slams shares and the currency even harder. Policymakers have consistently struggled to come up with steps that can convince markets they can stabilise the rupee and attract funds into the country despite extraordinary measures last month by the central bank to drain liquidity and action to curb gold imports and cut India's huge oil import bill. Rising oil prices, US Fed fears amplify pressure India badly needs foreign capital as it struggles with a record high current account deficit, growing fiscal pressures and an economy growing at the slowest in a decade. The failure to address India's economic challenges is becoming an increasing source of tension at a time when fears of a possible US-led military strike against Syria are knocking down Asian markets, with the prospect that the Federal Reserve will soon end its prolonged period of cheap money further raising concerns. At the same time, rising domestic bond yields threaten to raise borrowing costs across the already slowing economy, while global prices of oil and gold - the country's two biggest imports - have surged this week. "The end game for the current decline would be the day the rupee stops falling, alongside government measures like a substantial diesel price hike," said Samir Arora, a fund manager at Helios Capital in Singapore. Lacking confidence The rupee has plunged more than 20 per cent this year, by far the biggest decliner among the Asian currencies tracked by Reuters. Foreign investors are paring equity positions, having sold a net $3.6 billion in stocks since the start of June, but still their net purchases so far this year total nearly $12 billion. In bond markets, foreign investors have sold more heavily, with outflows reaching nearly $4.6 billion so far this year. Yet the government has so far failed to provide a coherent response, analysts said. Its approval of infrastructure projects on Tuesday was trumped by concerns about the fiscal deficit after the Lok Sabha approved 1.35 trillion rupees ($19.6 billion) plan to provide cheap grain to the poor. In its latest initiative, the government late on Tuesday proposed setting up a task force to look into currency swap agreements, a measure analysts said could bring some relief if carried out in time by reducing market demand for dollars or other major currencies. — Reuters Biggest fall On Wednesday, the rupee hit a record low of 68.85; closes at 68.80/81 Records biggest single-day fall since October 1995 Foreign investors turn heavy sellers of Indian shares
	Dollar not alone, Re breaches key levels across the board New Delhi, August 28 As rupee's record fall against the US dollar continues to hog the limelight, it has also lost ground and breached key levels against a host of other currencies, including British pound, euro and Swiss franc. Adding to rupee's woes, British pound today crossed Rs 106 level, euro went past Rs 92, Swiss franc touched Rs 75 mark, Canadian dollar was at Rs 65, Australian dollar at over Rs 60, while New Zealand dollar, Singapore dollar, Bruneian dollar and Libyan dinar crossed Rs 50 level. Among even more expensive foreign currencies, one Kuwaiti dinar is now worth more than Rs 240, Bahraini Dinar over Rs 180, Omani rial has went past Rs 175 and Latvia Lat at Rs 130. Against the most prominent foreign currency US dollar, the rupee has fallen to a record low of Rs 68.75. The US greenback has appreciated by about 28 per cent since May this year, amid aggravating concerns over flight of foreign funds from India due to weak domestic economic conditions and global headwinds. Rupee's fall has been same or higher against a host of other foreign currencies, including pound, euro, Swiss franc, for the same period. The plunge has been less sharper against a few like Australian dollar (10%), NZ dollar (16%) and Brazilian real (8%). A few currencies against which the rupee has appreciated since May include those in countries like Panana, Tongo, Surinam, Tajikistan, Solomon Islands, Salvador, Haiti, Kyrgyzstan, Liberia, Syria, Congo, Somalia, Sierra Leon and Guinea. — PTI
	Gold hits record high of Rs 34,500 on weak rupee New Delhi, August 28 Surpassing all previous records, gold scaled to a new peak of Rs 34,500 per 10 gram in the bullion market today as the rupee hit a new intra-day record low of 68.75 per dollar amid a firm global trend. However, late selling by stockists reduced the initial gains and the yellow metal closed with a biggest ever single-day gain of Rs 1,900 to Rs 33,900 per 10 gram, surpassing the previous high of Rs 32,975 on November 27 last year. Silver also registered a steepest rise of Rs 3,700 to Rs 58,500 per kg on increased offtake by industrial units and coin makers. The rupee has been witnessing an unprecedented plunge in its value as it dropped to an all-time intra-day low of 68.75. "The bullion demand has got a boost as rupee hit fresh record low and equities tumbled, leaving no place for investors but to park funds in gold as a safe-haven," Surender Jain, vice-president, All India Sarafa Bazar said. He said the yellow metal climbed to over 3-month high in global markets as speculation that the US could lead military action against Syria within days spurred investors' demand for a haven. The gold in Singapore, which normally sets price trend on the domestic front here, rose by 1.3 per cent to 1,433.83 dollar an ounce, the highest since May 14 and silver by 2.6 per cent to 25.10 dollar an ounce, a highest since April 15. — PTI
	Infosys’ Americas head quits Bangalore, August 28 Infosys Ltd's Americas head and global manufacturing chief Ashok Vemuri has resigned in the most high-profile exit since co-founder Narayana Murthy returned to the company to reverse two years of floundering growth. Vemuri, a Board member, was widely considered a contender to succeed chief executive SD Shibulal, another of the company's seven co-founders, when his term ends in mid-2015. A series of top-level departures has followed Murthy's surprise return on June 1 as executive chairman, including global head of sales and marketing Basab Pradhan and Sudhir Chaturvedi, head of financial services in the Americas. Murthy has said he will take tough decisions to restore the company's fortunes over the next three years and refocus it on winning large outsourcing contracts. A strategy to raise revenue from software products and consulting, at the expense of large outsourcing contracts, contributed to a series of disappointing results over the past two years. A transition plan to replace Vemuri is in place, Infosys, India's No. 2 software services exporter, said. "It's certainly not good news...this is certainly a big event," said Phani Sekhar, a fund manager with Mumbai brokerage Angel Broking, who holds Infosys stock. "You don't know what kind of sales reorganisation the company is planning and whether they will be able to get the right kind of people in place...so there is a certain amount of uncertainty now," Sekhar said. Narayana Murthy brought in his son Rohan Murty, a Harvard graduate, as executive assistant, a move seen at odds with the company practice of not involving the children of the founders in senior management. Vemuri's exit "could also be because of some of the moves he (Narayana Murthy) is planning, we'll have to wait and see," Sekhar said. Sanjay Jalona, currently regional head for manufacturing in North America, will take over as global head of manufacturing, Infosys said. — Reuters
	Kotak Bank eyes 20-25% growth Plans to open 100 new branches in the current fiscal Ruchika M. Khanna Tribune News Service Chandigarh, August 28 The tough banking environment notwithstanding, Kotak Mahindra Bank is looking at a growth of 20-25 per cent this financial year. By banking on agriculture sector and product innovation, the bank is hopeful to grow at a much higher pace than the banking industry, which is expecting a growth of 15 per cent. With the bank having a focus on ‘bharat’, the agriculture sector, along with the retail sector, is expected to be the growth drivers for the bank during this fiscal. In order to ensure that the bank is able to tap the rural sector, it is bringing a number of new financial products catering to the rural population. One of the fastest growing segments for the bank is the tractor loan segment. Talking to The Tribune here today, on the sidelines of the launch of a new savings product for minors, Mahesh Subramanian, executive vice-president and co-head, branch banking, Kotak Mahindra Bank, said since the bank was expecting good growth from agriculture in rural and semi-urban areas, they were hopeful that the bank would outperform the industry in terms of growth. “Other than this, we hope the wholesale banking, personal loan segment and retail banking will continue to be the growth drivers for the bank,” he said. As of now, the total business of Kotak Mahindra Bank is over Rs 1 lakh crore, with Rs 50,539 crore as advances and Rs 52,454 crore as deposits. “In the last financial year, the bank’s advances grew by 25 per cent and the deposits grew by 32 per cent. In the first quarter of this year (April-June), our advances grew by 19 per cent and deposits grew by 26 per cent. This has been possible because of the innovative products offered by the bank, including the highest rate of interest on savings account,” said Subramanian. The bank is also expanding by opening almost 100 branches across the country. The executive vice- president said half of the new branches would be opened in semi-urban and rural areas. The bank will also open 20 specialised branches for SMEs, farm sector and non-resident Indians.
	Videocon to roll out 4G services in 2014 New Delhi, August 28 Videocon Mobile Services is planning to roll out fourth generation (4G) services by July-August next year and is in talks with Nokia Siemens Networks (NSN) for infrastructure. "We will launch 4G in 10-12 months time, probably by July-August next year... we are in talks with NSN for the network," Videocon Mobile Services director and CEO Arvind Bali said. The services will be launched in all six circles, where it bagged spectrum in the November 2012 auction. The company has a Unified Licence, which allows it to provide all kinds of services, including 3G and 4G. The company in November 2012 won spectrum in six telecom circles - Bihar, Gujarat, Haryana, Madhya Pradesh, Uttar Pradesh East and West - for Rs 2,221.44 crore. The spectrum won by Videocon is paired and liberalised, which means the spectrum can be used to roll out next generation networks and services by adapting a highly spectrally efficient 4G technology. Bali said NSN is working on a technology wherein 4G can be offered on the same tower sites, which are being used to provide 2G services. — PTI
	Toyota launches Camry Hybrid New Delhi, August 28 Japanese auto giant Toyota today launched its all-new Camry Hybrid in India, the first ever hybrid car to be locally manufactured, priced at Rs 29.75 lakh (ex-showroom Delhi). The company, which is present in India in a joint venture with the Kirloskar group - Toyota Kirloskar Motor (TKM) - said the vehicle will be manufactured at a separate assembly line within TKM’s second plant located in Bidadi, near Bangalore, in Karnataka. "Globally India is the 9th country to manufacture Toyota hybrid vehicles," TKM said. The Camry Hybrid combines a newly developed hybrid exclusive 2.5 petrol engine with an electric motor and runs on 'Hybrid Synergy Drive', which senses when to switch between the two power sources - petrol engine and electric motor. It delivers a mileage of 19.16 kmpl. TKM managing director and CEO Hiroshi Nakagawa said: "The Camry Hybrid is India's first locally manufactured hybrid vehicle...It is our endeavour to offer the best vehicles with most advanced technology to India.