|
Exports down for first time in 8 months; trade deficit narrows
Maruti-Suzuki deal
Excise duty cut lifts auto sales in February
Gold, silver imports dip 71.4% to $1.63bn
|
|
Exports down for first time in 8 months; trade deficit narrows
New Delhi, March 11 After showing growth for seven consecutive months, exports contracted 3.67% in February to $25.68 billion. The trade deficit in February narrowed to $8.13 billion, the lowest level in five months. Industry said the export numbers were disappointing and it would be difficult to meet the annual target. Responding to the trade data for February, M Rafeeque Ahmed, president, FIEO, said export numbers were much below expectations. "The decline in exports is due to an amalgamation of factors such as sluggish manufacturing, contraction in global demand and restriction on current & capital account in few countries in Latin America", he said. Ahmed said exports may finally end up between $310 and $315 billion, much below the target of $325 billion fixed for the current fiscal. Total imports fell 17.09% to $33.81 billion in February. "The big picture on India's external sector is marked by a sharp reduction in imports — a direct consequence of slowdown rather than any breakthrough in exports," Assocham president Rana Kapoor said. Kapoor said this is reflected in a sharp reduction in the trade deficit for April-February period to $128 billion from $180 billion a year ago. "However, this is not sustainable since the import compression is a result of restrictions on gold imports and slowdown in industrial demand". Ficci president Sidharth Birla said: "The dip in exports is worrisome and now it looks doubtful if we would be able to achieve the target of $325 billion in the current fiscal". There is already a persistent demand to remove the curbs on gold imports as it is leading to smuggling and some quantity of gold is required for export purposes and domestic consumption. While exporters have been complaining about the government withholding dues, the Central Board of Excise and Customs (CBEC) today denied that refunds or drawbacks are being held back. According to Crisil Research, imports recorded the sixth consecutive month of double-digit contraction falling by 17.1% year-on-year in February. This contraction was driven by weak domestic demand and restrictions on gold imports that steepened the fall in non-oil imports to 24.5% compared to last year. |
|||||
Institutional investors raise new concerns
Seek clarification from Suzuki over Gujarat project Girja Shankar Kaura Tribune News Service
New Delhi, March 11 This is the second time the mutual fund companies, which have made substantial investment in MSIL, have written to the company expressing concerns about the future of the country’s largest carmaker. Forced by the doubts raised among its investors and the shareholders over the recent decision of MSIL to let SMC take over the manufacturing of vehicles and overall running of the new plant in Gujarat, the company late last month had come out with clarifications stating that the Japanese automobile giant would operate the plant on no loss, no profit. To allay fears among the investors and the shareholders, the MSIL had said if the contract manufacturing agreement expires, and in case is not extended by mutual consent, the assets of the Gujarat SMC would be transferred to MSIL at a fair value to be determined by an independent valuation. An uncertainty had cropped up for minority shareholders following the announcement that it will expand capacity at the Gujarat plant through a wholly owned subsidiary of Japanese parent SMC, forcing the MSIL stocks to fall in the country. Seeking to clarify its position as regards the SMC, the MSIL in a clarification to the stock exchanges and investors said, “The Suzuki Motor Corporation's subsidiary in Gujarat would operate on the basis that while it would not make any losses, it would also not accumulate any cash surpluses”. The cost of production of vehicles, produced by the SMC, would be calculated in an identical manner to that followed by MSIL in Haryana, and as would have been done if the Gujarat project had been executed by a 100% subsidiary of MSIL. This cost would not include return on investment and profits. In Haryana, MSIL marks up the cost to generate profits, which includes the return on capital employed, to arrive at the ex-factory sale price to its dealers. The amount of the mark up is determined, at all times, by market conditions. However, the mutual fund houses have upped their ante against MSIL by writing another letter to the Japanese carmaker saying the response to the previous letter was unsatisfactory and the company needs to clarify on important issues. The fund houses have apparently once again raised the issue of high royalty payments and have questioned the role of independent directors of MSIL while clearing the Gujarat Plant proposal. |
|||||
Excise duty cut lifts auto sales in February
New Delhi, March 11 Marked by volatility over the past few months, with sales dipping continuously for the past innumerable quarters, the jump in sales to 1,60,718 units in February from 1,58,512 units in the same month a year ago, had the car manufacturers wondering whether the trend would continue or the slide would hit the industry again. Car manufacturers said sales had risen for the first time since September, mainly due to the recently announced excise duty cut on vehicles and positive sentiment created by the Auto Expo. According to figures released by the Society of Indian Automobile Manufacturers (SIAM), motorcycle sales in February climbed 5.39% to 8,43,307 units from 8,00,165 units a year earlier, while the overall two-wheeler sales in February rose 9.69% to 12,20,012 units. There was, however, a note of caution issued by the car manufacturers, who said they would have to watch the trend for sometime before announcing a turnaround in the industry. SIAM director-general Vishnu Mathur said they would watch for sometime before giving out the positive news. "It will take some more time to see if the negative trends have reversed. We are getting feedback from companies that footfalls have increased," he said, adding the excise duty cut and the Auto Expo have created a positive sentiment but it is too early to say if all this would translate into sales. |
|||||
Gold, silver imports dip 71.4% to $1.63bn
New Delhi, March 11 Imports of gold and silver in February 2013 stood at $5.24 billion. In January this year, they were $1.72 billion. Imports of the precious metals during April-February declined 41.47% to $30.7 billion from $52.4 billion a year earlier. Lower imports helped to narrow the trade deficit to $8.13 billion in February from $14.1 billion. India's current account deficit (CAD), which is the excess of foreign exchange outflows over inflows, touched a historic high of 4.8% of GDP in 2012-13, mainly due to rising imports of petroleum products and gold. A high CAD puts pressure on the rupee, which in turn makes imports expensive and fuels inflation. According to a finance ministry official, the CAD is expected to fall by almost 50% to $45 billion in the current financial year. — PTI |
|||||
SpiceJet, IndiGo launch another fare war Idea launches 3G-enabled smartphones EIL shares surge over 6% as Board to mull dividend 2G and 3G tariffs will converge in future: Vodafone Google's Nikesh Arora to get $3.5m bonus for FY'13 Max Life Insurance ties up with Toyota Financial Services |
|||||
|
HOME PAGE | |
Punjab | Haryana | Jammu & Kashmir |
Himachal Pradesh | Regional Briefs |
Nation | Opinions | | Business | Sports | World | Letters | Chandigarh | Ludhiana | Delhi | | Calendar | Weather | Archive | Subscribe | E-mail | |