New Delhi, October 1
The Finance Ministry today said the economy will improve in the second quarter of the current financial year and the current account deficit (CAD) will be contained at $70 billion.

"As we are seeing growth clawing back, I am quite sure that the environment will be conducive for further incentivising of growth and we will see whatever steps have to be taken," Economic Affairs Secretary Arvind Mayaram said.

"It (GDP) will be more than 5 per cent, it cannot be less than 5 per cent," he said when asked about forecast by private analysts that growth could be lower than 5 per cent in 2013-14.

The economy grew at a four-year low of 4.4% in the April-June quarter of current year. "The Q2 GDP growth should be better than first quarter. As far as the interest rate is concerned, it is completely the domain of RBI and the Governor will take a call on that," Mayaram said. RBI is scheduled to announce its second quarter policy review on October 29.

On the CAD, he said it was expected to be less than $70 billion or 3.7% of GDP for the full fiscal. "The $70 billion CAD will be fully and safely financed without any recourse to dipping into reserves," he said. The CAD, which is the difference between inflow and outflow of foreign funds, was at 4.9% of GDP in the April-June quarter.

"The elevated level of CAD in Q1 is mainly due to gold import. Gold import this year would be restricted below 800 tonne," he said. Commenting on the CAD data, Crisil Research said it widened to 4.9% of GDP in the first quarter from 4% in the same period last year. With CAD at $21.8 billion, foreign capital inflows of $20.5 billion were slightly inadequate to finance it. It said the rupee therefore dipped nearly 3.2% over the previous quarter and averaged a low of 55.9 per dollar. Widening of CAD was due to a sharp increase in gold imports by $7.3 billion over a year ago.

Crisil said CAD will exhibit an improvement in the coming quarters due to the curbs on gold imports, a weak rupee benefiting exports, and a sharp slowdown in domestic demand pulling down consumption and investment goods imports.

Bangalore, October 1
Punjab Deputy Chief Minister Sukhbir Singh Badal today said a number of companies from Bangalore have assured him of sending teams to Punjab to explore investment opportunities.

Interacting with the media after meeting industrialists here yesterday and today, Badal said he had been given assurances by several companies regarding investing in the Knowledge City at Mohali and in the Medicity and the Education City at Mullanpur. He said the state government had reserved 1,600, 2,000 and 300 acres for the three projects, respectively.

Badal said Bangalore was his first stop to attract investment proposals as a run up to the Progressive Punjab Investment Summit to be held in Chandigarh on December 9 and 10. His next stop is Mumbai, Badal said, and added the Punjab Government team would visit some foreign countries also to tap investment potential. The state would achieve power surplus status by the time the global summit of investors was held in December, he said.

Earlier today, Badal, while addressing captains of the industry, said the Punjab Government was ready to give preferential market access to entrepreneurs for setting up electronic hardware and agro processing units in Punjab.

He said while Punjab had already announced a host of incentives for new investments, including 80% retention of VAT and CST by the companies, he was ready to go the extra mile to attract investments into the state.

He said investors setting up industries in key areas such as electronic hardware and food processing besides few other sectors, which would be identified by the government soon, would get the first choice to bid for government orders as well as orders from various boards and corporations, including the state power utility.

On a suggestion from Sanjeev Keskar of the India Electronics and Semi Conductors Association, the Deputy CM agreed to establish an incubation centre at Mohali which would help small entrepreneurs to work on electronic systems and semi conductor design. Keskar assured the Deputy CM that his organisation would partner with the state government to make the incubation centre a success.

New Delhi, October 1
Jet Airways' proposed sale of a 24 per cent stake to Abu Dhabi-based Etihad has got SEBI’s go-ahead after both carriers revised their deal to comply with conditions set by the market regulator.

After studying the revised deal structure, SEBI was of the opinion that the Rs 2,058-crore transaction would not trigger a mandatory open offer for purchase of shares from public shareholders and Etihad would not be considered a promoter entity in Jet Airways.

However, SEBI has left it to the government to take a final call on the revised Commercial Cooperation Agreement (CCA) proposed by Jet and Etihad Airways, sources said.

The deal was announced in April and has been stuck due to objections from regulators, including the SEBI and the Competition Commission of India, as also other agencies, as it was deemed to yield significant control of the airline to Etihad.

The Foreign Investment Promotion Board (FIPB) approved the deal in July with some conditions after both parties assured it that 'effective control' would remain with local promoters.

The proposal will now be considered by the Cabinet Committee on Economic Affairs.

The CCI had also sought changes in the original deal. The two parties had informed the fair trade regulator about the changes in the deal and approval from the CCI is expected soon. — PTI

Mumbai, October 1
A gain or loss of 1,950 points in Bombay Stock Exchange’s benchmark index Sensex will bring a nationwide trading halt for up to one hour in a day till October 11, while such circuits would be calculated on a daily basis thereafter.

Markets regulator Securities and Exchange Board of India (SEBI) had asked stock exchanges last month to begin calculating the trading halt circuit breakers on a daily basis, as against the prevailing practice of such trigger points being calculated on a quarterly basis.

In separate circulars, the Bombay Stock Exchange and National Stock Exchange said the circuit breakers for 10 per cent, 15 per cent and 20 per cent movements in Sensex and Nifty have been calculated on the basis of quarter-end figures for trading till October 11.

Thereafter, the circuit triggers would be determined as per Securities and Exchange Board of India’s latest direction of daily calculation.

So far, the exchanges have been calculating the trigger values on the basis of closing value of Sensex or Nifty at the end of every quarter, the latest being as per the value on September 30.

As per the circuit-breaker system, in case of a 10 per cent movement of either of these indices (1,950 points for Sensex or 570 points for Nifty), there would be a one-hour market halt if the movement takes place before 1300 hrs.

In case such a movement takes place at or after 1300 hrs but before 1430 hrs there will be a trading halt for 30 minutes. If the movement takes place at or after 1430 hrs there will be no trading halt at the 10 per cent level and the market will continue trading.

At 15 per cent (2,900 points for Sensex or 860 points for Nifty), there will be a two-hour market halt if the movement takes place before 1300 hrs.

If the 15 per cent trigger is reached on or after 1300 hrs but before 1400 hrs, there will be a one-hour halt. If the 15 per cent trigger is reached on or after 1400 hrs, the trading will be halted for the remainder of the day.

A movement of 20 per cent (3,875 points for Sensex and 1,150 points for Nifty) would lead to the trading being halted for the remainder of the day.

The percentages have been calculated on the basis of closing value of Sensex as on September 30, 2013. These percentages are translated into absolute points of index variations (rounded-off to the nearest 25 points in case of Sensex).

These triggers values would be applicable for the period October 1-11, 2013. — PTI 

New Delhi, October 1
In a move that would bring about some cheer to the telecom industry, the nine-member committee set up by the DoT to examine TRAI’s recent recommendations on the third round of spectrum auction in the 800 Mhz, 900 Mhz and 1,800 Mhz bands, has accepted the base prices suggested by the regulator.

The department has reportedly given its nod to TRAI's recommendation to slash the floor price of 2G spectrum by 37 per cent. It has asked TRAI for suggestions on the base price for spectrum in 800MHz band.

This would mean that there could be an auction in the 800 MHz band as well. TRAI had not offered any suggestions on the pricing of the 800 MHz band, used by CDMA operators, saying no auction is required due to the lack of demand.

Slashing of floor price for pan-India spectrum is likely to be a huge respite for the telecom players, who have so far stayed away from the spectrum auctions owing to 'steep prices'. If implemented, the floor price will be slashed to Rs 1,496 crore per MHz in 1,800 MHz band.

Most of the mobile phone operators had abstained from the past two rounds of auctions, citing exorbitant prices.

Apart from the suggested cuts in the base price for spectrum in the 1,800 Mhz band, TRAI had also suggested a 60% cut in the reserve price of airwaves in the 900 Mhz band for three circles where licences are coming up for renewal next year.

The Telecom Commission is likely to take a final call on the price of the 1,800 Mhz band on October 3.

TRAI had suggested a pan-India reserve price of Rs 1,496 crore per MHz in the 1,800 band, down 37 per cent from the base price set in the previous auction.

BRIEFLY

BMW recalls 176,000 cars
Frankfurt: BMW is recalling 176,000 vehicles over a problem with the power brake system. The company says in rare cases an interruption in oil supply to a part can mean loss of power braking assist. The brakes will still work but the driver would have to press harder on the pedal. — AP

Markets closed today
New Delhi: All wholesale commodity markets, including bullion and metal, will be closed on Wednesday for 'Gandhi Jayanti'. The BSE and the National Stock Exchange, forex, money and commodity futures markets will also remain closed. — PTI

Axis Bank hints at hike in lending rate
Mumbai: After raising its base rate in August, Axis Bank on Tuesday hinted at raising interest rates again, citing increasing cost of funds. The bank had raised its base rate by 25 basis point to 10.25 per cent in August after the RBI announced slew of liquidity tightening measures to curb rupee's fall. — PTI

Tata Comm shares gain 8%
Mumbai: Shares of Tata Communications soared by nearly 8 per cent on Tuesday after Vodafone's South African subsidiary Vodacom said it has entered into exclusive discussions regarding a potential acquisition of Neotel, controlled by the Indian firm. The scrip settled at Rs 202.50, up 7.66 per cent on the BSE. — PTI

Nissan hikes prices up to 2.9%
New Delhi: Japanese auto maker Nissan hiked prices of its mid-sized sedan Sunny and compact car Micra on Tuesday by up to 2.9% with immediate effect, to partially offset the impact of rupee depreciation and escalating input costs. — TNS