New Delhi, February 28
The economy is in a grim situation clocking its fifth straight quarter of sub-5% GDP growth at 4.7%, with industry saying that the new government will have a challenging task to revive it.

Growth has remained below 5% this year with GDP expanding by 4.8% in the July-September quarter and 4.4% in April-June pointing to a grim economic situation. Growth in the first nine months (April-December) was 4.6% compared with 4.5% in the same period a year ago.

Industry body CII said today’s figure of 4.7% would erode some of the cautious optimism that was starting to become visible over the past two months.

It added that a weak investment demand is the biggest problem that needs redressal. “The festive season of October and November has not done enough to reverse the slowdown and that causes additional concern. The fact that the current figures are over a favourable base effect, compounds the problem”, the statement said.

FICCI cautioned that with this performance achieving the full-year target of 4.9% would also be a challenge.

“The GDP growth figure for the third quarter disappoints and adds to concerns on achieving the full-year target of 4.9% as brought out by the CSO earlier," said Sidharth Birla, president, FICCI.

The performance of the agriculture sector has not picked up as expected in this quarter and the manufacturing sector has shown a sharp slippage with growth being a negative 1.9%.

Birla cautioned that this prolonged slowdown in growth will have serious implications for employment generation and unless the trajectory is reversed soon there would be grave social challenges.

Assocham president Rana Kapoor said the slow GDP growth at 4.7% for the third quarter of FY 2013-14 is only an indication of the kind of the economic challenges before the next government which will be in office in the next two months.

Even 4.7% growth has been brought about by the FCNR deposits in the Q3 as reflected in an unusual expansion of 12.5% in financing, insurance, real estate and business services group. At the ground level, the growth is much slower and that is going to be a big task for the incoming Finance Minister and the next government, said Kapoor.

New Delhi, February 28
Poor output of coal, petroleum refinery products and natural gas dragged down core sector growth to 1.6% in January from 8.3% in the same month a year ago. The Index of Eight Core Industries grew 2.1% in December.

The eight core industries — fertilisers, cement, steel, electricity, crude oil, coal, petroleum refinery products and natural gas — have a combined weight of about 38% in the IIP.

Core sector growth was 2.4% during the April-January period of this financial year compared with 6.9% in the same period of 2012-13.

Coal output contracted 0.7% in January. Petroleum refinery production registered a fall of 4.5% and natural gas output shrank 5.2%. Steel output growth slowed to 3.4%, while the expansion in cement production eased to 1.5%.

Dashing hopes of a recovery, the IIP contracted by 0.6 per cent in December mainly due to poor performance in the manufacturing sector. — PTI

New Delhi, February 28
The government has approved 10% stake sale in Indian Oil Corporation (IOC) to state-run ONGC and OIL at a discount of 10%, which will fetch about Rs 5,300 crore to the exchequer.

"Yes, 10%," Oil Minister Veerappa Moily said when asked if the IOC share sale will happen at a discount to market price.

The sale of 10% stake or 24.27 crore shares will be through an off-market transaction, with ONGC and Oil India Ltd (OIL) buying 5% stake each.

"The two companies (ONGC and OIL) will now work out the deal and the stake sale will happen very shortly. It should be happening in next few days. The government advises the Board and the two Boards will meet and decide. It will be an off-market deal," Oil Secretary Vivek Rae told reporters after an EGoM meeting.

The EGoM on disinvestment, headed by Finance Minister P Chidambaram, met today to finalise the price of the share sale.

"We expect to raise around Rs 5,300 crore from IOC stake sale," Disinvestment Secretary Ravi Mathur said.

IOC shares were trading at Rs 249 in morning trade on the BSE, up Rs 1.05 apiece, valuing the company at Rs 60,456 crore.

IOC shares have gained more than Rs 37 apiece since January 16, when the EGoM on disinvestment cleared the stake sale in the nation's largest oil firm through a block deal. — PTI

New Delhi, February 28
The government today hiked the import tariff value on gold and silver to $433 per 10 grams and $699 per kg, respectively, taking into account the volatility in the precious metals' global prices.

Import tariff value is the base price at which customs duty is determined to prevent under-invoicing. The tariff value is revised on a fortnightly basis after analysing the global price trend. — PTI

New Delhi, February 28
The government will sell 5% stake in BHEL to LIC of India, fetching the exchequer about Rs 2,046 crore.

"BHEL disinvestment will happen this fiscal through a block deal to LIC," Disinvestment Secretary Ravi Mathur said. — PTI

BRIEFLY

RIL shares hit 6-month low, close below Rs 800 level
Mumbai: Shares of Reliance Industries on Friday fell nearly 2% on bourses, closing below the Rs 800 mark for the first time since August 2013. RIL's scrip ended 1.39% lower at Rs 799.25 on the BSE. During the day, it had lost 2% to touch Rs 794. At the NSE, it settled at Rs 797.30, down 1.65% from its previous close. — PTI

HMT employees to get revised wages
New Delhi: The government on Friday approved implementation of the 1997 pay scale along with increase in the retirement age from 58 to 60 for the employees of HMT Machine Tools Limited. The decision was taken at a meeting of the Cabinet Committee on Economic Affairs (CCEA). — PTI

NTPC to set up Rs 17,000-cr power project in MP
New Delhi: NTPC will lay the foundation stone for the 2,640 MW power project in Madhya Pradesh, entailing an investment of Rs 17,000 crore, on Sunday. The Bundelkhand Super Thermal Power Project, located in Chhatarpur district, would have four units — each having 660 MW generation capacity. — PTI

L&T Construction bags Rs 5,220-cr contract
New Delhi: L&T Construction on Friday said it has received orders worth Rs 5,220 crore in the first two months of this year across various business segments. The water and renewable energy business segment got the highest order at Rs 2,019 crore from Gujarat, Karnataka and West Bengal. — PTI

CPI-IW down 2 points at 237 in January
New Delhi: The Consumer Price Index for Industrial Workers (CPI-IW) for January declined by two points and was pegged at 237 points. Retail inflation for industrial workers eased to 7.24% in January compared to 9.13% in previous month and 11.62% in same month last year mainly on account of softening in prices of food items. — PTI