Mumbai, September 11
Credit ratings agency Crisil today cut India's economic growth estimate to 4.8 per cent for the current fiscal and said agriculture is the only hope for higher rate of expansion in this period of downturn. Its earlier GDP estimate for 2013-14 was 5.5 per cent.

The agency also warned the government of overshooting the fiscal deficit target at 4.8 per cent due to poor revenue growth and pegged it at 5.2 per cent this fiscal.

"GDP growth for FY14 will come down to 4.8 per cent because of the host of issues which we are facing at present," Crisil managing director and chief executive Roopa Kudva told reporters here.

"I think we are at the bottom but a rapid recovery from here is unlikely. It will be an L-shaped recovery from here on," she added.

Kudva, however, said agriculture, on the back to good monsoon, holds the potential to push the overall GDP growth number to up to 5.2 per cent.

"We are expecting agriculture to grow by 4.5 per cent this fiscal, which is double that of last year. However, if this number goes up to 6 per cent, the overall GDP growth will get pushed to 5.2 per cent," Kudva said, adding rural consumption will also be a big push for growth.

Kudva said Crisil expects the CAD to narrow up to 3.6 per cent due to government measures on imports taken in the recent past and the overall uptick in the developed world, which has the potential to lift up the rupee to the 60 level by March.

Crisil said it expects the industrial production to hit a two-decade low and inflation staying higher which will limit RBI's scope to cut rates. Kudva said Crisil was of the view that industry will grow at a meagre 1 per cent this fiscal, which will be the worst in two decades and added that infrastructure, capital goods, real estate and transport operators will be the worst hit.

Crisil chief economist DK Joshi said the government can rein in the number only by cutting its expenditure, as it did last fiscal, but said such a proposition is unlikely this fiscal. It expects inflation to be elevated at 6.2 per cent this fiscal, which will limit the RBI's options to increase the interest rates, Kudva said. — PTI

Mumbai, September 11
The rupee continued its north-bound journey for the fifth straight session, appreciating by 46 paise to close at 63.38 today after fresh RBI steps to boost foreign fund inflows and hopes of a diplomatic solution in Syria reduced the dollar's appeal as a safer investment. The local currency was also boosted by consistent capital inflows and dollar sales by exporters.

The RBI yesterday allowed swap facility for term deposits of lenders and relaxed norms for banks to borrow funds from overseas.

US President Barack Obama said he would pursue diplomatic efforts to remove Syria's chemical weapons, giving rise to hopes that the possibility of a military strike are fading.

The rupee opened at 63.90 a dollar from the previous close of 63.84 on the interbank foreign exchange market and declined to a low of 64.20 as local stocks fell.

It rebounded to a more-than-three-week intra-day high of 63 before settling at 63.38, a rise of 46 paise or 0.72 per cent. In straight five sessions, the rupee has spurted by 425 paise or 6.28 per cent.

"The expectation that the Syrian crisis might not develop into a full-fledged war has led to the reduction in the safe-haven demand in the US dollar and Japanese yen. All the emerging nations currencies are seen benefiting," said Abhishek Goenka, CEO of India Forex Advisors.

Foreign institutional investors pumped in $421.15 million yesterday, according to data from the SEBI. — PTI

New Delhi, September 11
Aditya Birla Group firm UltraTech Cement Ltd today said it will acquire Gujarat Cement unit of Jaypee Cement Corp Ltd for Rs 3,800 crore.

UltraTech Cement will acquire the Gujarat Cement Unit of Jaypee Cement Corp Ltd. Gujarat Cement Unit comprises an integrated cement unit at Sewagram and grinding unit at Wankbori, the company said in a statement.

The combined capacity of both the divisions is 4.8 million tonnes along with 57.5 MW coal-based thermal power plant, limestone reserves of over 90 years at current capacity and a captive jetty at Sewagram.

"With this acquisition of 4.8 million tonnes per annum, the company's current capacity increases to 59 million tonnes per annum. With projects underway it will stand raised to 70 million tonnes by 2015," UltraTech Cement chairman Kumar Mangalam Birla said.

Putting an enterprise value of Rs 3,800 crore on Gujarat Cement Unit, UltraTech said it will issue equity to the shareholders of Jaypee Cement.

The proposed transaction is subject to approval of shareholders and creditors, sanction of the Scheme of Arrangement by the high courts, approval of the Competition Commission of India besides other statutory approvals. — PTI

New Delhi, September 11
Persons with annual income of less than Rs 6 lakh will not get a car loan from SBI as the bank has tightened eligibility conditions for its four-wheeler loan scheme with a view to minimising possible defaults.

The eligibility limit for loan issuance for salaried individual for car purchase has been raised from Rs 2.5 lakh per annum to Rs 6 lakh per annum, as per the recent circular of the bank. For the SBI account holder, the limit has been raised to Rs 4.5 lakh per annum.

SBI currently offers car loans at an interest rate of 10.45 per cent, as per the bank's website. Giving the rationale for increase in the eligibility criteria, a senior bank official said the decision to revise upwards the gross income limit is taken in view of moderation in economy.

Economic condition has a bearing on the repayment capacity of the borrowers, the official said, adding, this is preemptive step to ward off fresh slippages. The bank's auto loan portfolio grew by 38.71 per cent to Rs 26,411 crore at the end of first quarter of the current fiscal as against Rs 19,040 crore at the end of same quarter of the previous fiscal. — PTI

Mumbai, September 11
State-owned India Infrastructure Finance Company Ltd (IIFCL) has sought market regulator SEBI’s approval to raise up to Rs 8,171 crore through tax-free bonds.

"Public issue by IIFCL tax-free, secured, redeemable, non-convertible bonds in the nature of debentures of face value of Rs 1,000 each, having tax benefits ... for an amount aggregating up to Rs 8,171.50 crore for fiscal 2014," said the draft documents filed with SEBI.

The proceeds from the issue would be utilised by IIFCL for financing activities, including lending and investments.

Besides, the fund would be used to meet working capital requirements.

In February this year, the government had allowed some financial institutions to mop up about Rs 50,000 crore from tax-free bonds in 2013-14 in a bid to encourage investment in the infrastructure sector. — PTI

Paris, September 11
The Senegalese government has won an initial ruling in an international arbitration case concerning an iron mining project in the southeast of the country, steel giant ArcelorMittal said today.

"The arbitral tribunal has now issued its first award and decided that Senegal is entitled to terminate the 2007 agreements" but the question of possible damages is yet to be considered, ArcelorMittal said of the ruling by the Paris-based Court of Arbitration of the International Chamber of Commerce.

The world's top steel company said it concluded an agreement with Senegal in 2007 to develop the Faleme project in the Tambacounda region to mine iron ore, a key component of steel.

The envisaged investment of $2.2 billion was the biggest industrial project in the west African country, and was due to have started operations in 2011 and produce 25 million tonnes of iron ore per year.

At the time the Senegalese government estimated the facility would bring it around 75 billion CFA francs in tax revenues per year. — AFP

Sirsa, September 11
Nearly 120 villagers from Darbi village of Sirsa who were earlier running small hosiery manufacturing business in their village will now be able to improve their production on ultra-modern machinery.

Under the Cluster Development Programme of the Ministry of Micro, Small and Medium Enterprises (MSME), the authorities are providing them ultra-modern machinery and other facilities in the village.

Sirsa Deputy Commissioner J Ganesan today distributed cheques worth Rs 1 crore to 15 entrepreneurs from the village as loan sanctioned by a nationalised bank. Ganesan said more entrepreneurs will also join the cluster in due course.

Under the cluster development scheme, the cluster members will pool in funds for the purchase of land and the district administration will spend Rs 60 lakh on the construction of building at Darbi from the Backward Region Grant Fund (BRGF), a scheme for correcting regional disparities in backward districts.

“Once the building is constructed, the Ministry of Micro, Small and Medium Industries of the Central Government will spend Rs 4 to 5 crore on the state-of-the-art machinery in the building,” Ganesan said.

Sanjay Nigam, programme coordinator of the Cluster Development Programme in the MSME Centre at Karnal, said the basic aim of the programme is to enhance the productivity and competitiveness as well as capacity building of Micro and Small Enterprises (MSEs) and their collectives in the country.

Clustering of units also enables service providers, including banks and credit agencies, to provide their services more economically, thus reducing costs and improving the availability of services for these enterprises, he said.