New Delhi, January 30
The Finance Ministry today said the US Federal Reserve’s decision to trim its monetary stimulus would not affect the Indian markets and the government and the RBI would take all necessary steps to ensure financial stability.

"Both the Government of India and the RBI will continue to remain vigilant and will take whatever steps are necessary to ensure that there is stability in the financial markets," the Finance Ministry said.

The US Federal Reserve yesterday decided to cut its bond purchases by another $10 billion. It has now decided to purchase $65 billion per month of mortgage-backed securities and longer-term treasury securities as against $75 billion per month earlier.

"This decision was expected and should not in anyway surprise or affect the Indian markets. However, it may be noted that $65 billion is not a small sum and will continue to infuse a large amount of liquidity into the world markets," the statement added.

The announcement of the Federal Reserve sent markets into a tizzy with the BSE Sensex plunging over 225 points in early trade and the rupee losing 33 paise to trade at 62.75 a dollar.

The Finance Ministry reaffirmed that the Indian economy is better prepared for the consequences, if any, of the taper.

Economic Affairs Secretary Arvind Mayaram said the economy has emerged out of the trough and the government will rein in fiscal deficit at 4.8% of GDP in the current fiscal.

Mayaram said the government will remain vigilant on the evolving situation and there is no reason to worry over the economy.

The Current Account Deficit (CAD) will be lower than 2.5% of GDP and the rupee will remain range-bound, he said.

Meanwhile, the Finance Ministry further said the FDI and FII inflows into the country remain strong and there has been an accretion to the foreign exchange reserve which stood at $295 billion.

The CAD is now expected to be below $50 billion in 2013-14. "Therefore, there should be no undue concern over external factors," it said.

The CAD was at a record high of $88.2 billion or 4.8% of the GDP last fiscal.

The statement further said the Federal Reserve has not announced a sequential taper and has made it clear that "asset purchases are not on a pre-set course" and that they will take "further measured steps at future meetings." The Federal Reserve has also made it clear that the result of the decision will be a "sizeable and still-increasing holdings of longer-term securities", it said.

The Fed had first in May announced it will taper bond purchases, sending the markets world over into turmoil with the rupee hitting record lows. However, later it postponed the decision. — PTI

US central bank's decision The US central bank on Wednesday decided to cut its bond purchases by another $10 bn It has now decided to purchase $65 bn per month of mortgage-backed securities as against $75 bn per month earlier The announcement sent markets into a tizzy with the BSE Sensex plunging over 225 pts in early trade and the rupee losing 33 paise

New Delhi, January 30
A ministerial panel on disinvestment today cleared the sale of a 10% stake in Engineers India Ltd (EIL) through an follow-on public offer (FPO) by the government, which may fetch the exchequer Rs 500 crore.

"EGoM has decided to clear the FPO of EIL. Ten per cent equity will be divested through an FPO. We are looking at around close to Rs 500 crore," Disinvestment Secretary Ravi Mathur said.

The Department of Disinvestment has already held overseas roadshows to attract foreign investors to the EIL stake sale. "We can give a definite timeline for the issue after we receive approval from the Registrar of Companies tomorrow," Mathur said.

EIL shares closed at Rs 146.65, down 3.35%, on the BSE, valuing the company at Rs 4,941 crore.

The government plans to disinvest 3.36 crore EIL shares, with up to 5% of the offer reserved for employees.

ICICI Securities, IDFC and Kotak Mahindra Capital, Edelweiss Financial Services and IDBI Capital are managing the disinvestment.

The government holds 80.4% in the 'miniratna' public sector undertaking. In 2010, it had divested 10% of its stake in EIL through an FPO.

In January last year, the government decided to go in for further disinvestment in the consultancy major.

EIL is a leading provider of design, engineering and project management and consultancy services firm for the hydrocarbon sector.

The government plans to raise Rs 40,000 crore by way of disinvestment in the current financial year. So far, it has raised about Rs 3,000 crore through PSU stake sales. — PTI

New Delhi, January 30
Automobile makers in the country are looking at the 12th edition of the Auto Expo, due to begin in the first week of February to revive the auto industry and give a fillip to the Indian economy.

The expo would see the unveiling of as many as 70 new vehicles and 26 global launches of which 15 are cars, making the Indian Auto Expo as one of the happening exhibitions of automobiles. It is touted as one of the world’s largest and most expensive auto shows.

Vikram Kirloskar, president, Society of Indian Automobile Manufacturers (SIAM), said last year was a tough one with factors such as slowdown in the economy, rising fuel costs, less disposable income and poor sentiment negatively affecting sales. He said the industry was optimistic and had been working hard to produce better products to boost sales. "We hope the Expo will help revive sentiment and industry growth," he said.

The mega show This year the show will be held in two parts — Components Show at Pragati Maidan and Motor Show at Greater Noida The expo would see unveiling of as many as 70 new vehicles and 26 global launches of which 15 are cars It is touted as one of the world’s largest and most expensive auto shows

Houston, January 30
After 22 months of being together, search engine giant Google has decided to part ways with Motorola by entering into an agreement to sell it to Lenovo for $2.91 billion, the company announced on Wednesday.

Google will keep the "vast majority" of around 17,000 patents it acquired when it bought Motorola in 2012 for $12.5 billion. — PTI

BRIEFLY

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