Negative growth The credit card outstandings have seen a negligible growth of 1.6% in the current fiscal The propensity to borrow short-term for spending against time deposits has seen a drop of 4% The micro credit has also witnessed a decline in growth of 5.9% in the current fiscal

New Delhi, March 20
A study by industry body Assocham before the General Election has said that consumer confidence in the economy has hit a new bottom and it will take big ticket initiatives from the new government to lift the morale of both consumers and business.

The study said borrowing on credit cards, bank advances against time deposits and borrowing from the micro credit markets are indicating this trend.

Mirroring the state of consumer confidence, which is a key driver of economic growth, the study brings out a disturbing trend and a paradox. The lesser spending by consumer is not even contributing to any increase in savings either, reflecting pressure on the household budgets resulting in avoidance of discretionary borrowings, it said.

The credit card outstandings have seen a negligible growth of 1.6% in the current financial year so far (April-January) while the propensity to borrow short-term for spending against time deposits has seen a sharp erosion of 4% between April 2013 and January 2014.

“Like the trade, industry and the financial markets, the consumer too is hoping for some uptick in the economy, accompanied by a sharp fall in inflation of essential commodities and a drop in interest rates on loans for purchase of residential properties, two-wheelers and passenger cars”, the study said.

The current financial year, which has been one of the most tumultuous periods, has also shaken the confidence of the consumers with smaller needs - one who looks towards small bank loans for micro needs. The micro credit has also witnessed a decline in growth of 5.9% in the current fiscal as against 15.7% year- on-year January, 2014 versus January, 2013. The previous year, which had also seen the GDP growth of sub-5%, had seen somewhat better consumer confidence.

“It seems erosion in generation of new employment and lack of confidence about retaining the jobs with scores of companies going in for cost-cutting, the demand for discretionary goods, especially on bank loans, is bound to see further drop,” the study said.

The study said if a stable government is voted, the first major turnaround will be seen in the financial markets with FIIs focussing on India. This will help the country’s current account deficit and may prompt the government to relax the restrictions on gold imports, which in turn will see revival in the entire gems and jewellery industry. Besides, better inflows will result in improved strength for rupee.

Mumbai, March 20
The Sensex and the Nifty today closed at their weakest level in two weeks in line with a slump in global equity markets after US Federal Reserve signalled it would raise interest rates by the middle of 2015.

The benchmark S&P BSE Sensex snapped its three-day gaining string and dropped 93 points to close at 21,740.09 — the lowest close since 21,513.87 on March 6. HDFC and L&T led the 22 losers in the 30-share index.

The wide-based 50-issue CNX Nifty of the NSE also dipped 40.95 points, or 0.63%, to end below the 6,500-mark at 6,483.10. This is also its weakest since 6,401.15 on March 6.

Total market breadth was negative as 1,534 stocks ended lower, 1,269 finished higher and 137 closed flat.

American stocks fell yesterday night after Federal Reserve chair Janet Yellen said the time frame for raising interest rates could be on the order of around 6 months after the stimulus ends. The Fed also voted to cut its monthly bond purchases by $10 billion to $55 billion.

Brokers said the signal in hike in interest rates by Fed might affect foreign fund inflows, which drove domestic indices to lifetime highs recently.

Jignesh Chaudhary, Head of Research, Veracity Broking Services, said: "Yesterday the Federal Reserve gave indication that it may raise US interest rates from the middle of next year. If rates rise, then we could see capital outflows from emerging markets." The new time frame is around 6 months earlier than what the markets had expected, according to HDFC Securities.

A perceived slowdown in the Chinese economy also aggravated the situation further as all Asian markets closed in the red.

Selling was seen in most of the segments as 9 out of 11 sectoral S&P BSE indices closed with losses while only IT, Tech and Healthcare finished with gains. — PTI

New Delhi, March 20
Country’s second largest smartphone seller Micromax today announced a strategic partnership with chipset maker MediaTek and telecom services provider Aircel to offer better experience to its customers.

"This is aimed at offering the best out-of-the-box experiences for the Indian users and the partnership will see a unique amalgamation of the expertise of the three companies," Micromax co-founder Vikas Jain said.

Under the alliance, Aircel will team up with Micromax to introduce a range of offers for the consumers which will be almost equivalent to the cost of the device.

Powered by MediaTek chipsets, the devices promise to deliver a seamless and a powerful user experience, while the bundled Aircel offers will drive data growth in the country.

The offers will be initially available across four Micromax devices — MMX 377G, Funbook Mini 410i, A090 and X070 — to be available next month.

While Aircel will offer one-stop solutions to address the increasing data demands, MediaTek along with Micromax's expertise in product design and performance will redefine the user experience creating a win-win ecosystem for the Indian users, Jain added.

Meanwhile, Micromax is looking to hit $1 billion revenue this fiscal on the back of its affordable and entry-level smartphones. The company had revenue of Rs 3,168 crore for the financial year 2012-13.

According to latest assessment of the market share, Micromax holds around 16% market share.

Company’s offer
Under the alliance, Aircel will team up with Micromax to introduce a range of offers for the consumers which will be almost equivalent to the cost of the device

Bangalore, March 20
Toyota Kirloskar Motor (TKM) has suspended some of the workers at its two plants in the city where it has declared lockout, as the strike continued for the fifth day today amid government's conciliatory efforts to break the impasse.

"A decision to suspend some of the members pending inquiry, for serious misconduct, was taken earlier in the week. This is in line with the company's rules and regulations," TKM said.

It did not specify the number of suspended workers.

Toyota Kirloskar Workers Union president Prasanna Kumar said suspended workers have not received any letter.

"We are attending a meeting convened by Karnataka Deputy Labour Commissioner and Additional Labour Commissioner, and we will press for lifting of the lockout and withdrawal of suspension, if any," Prasanna Kumar said adding the "lockout is illegal." The government's talks with the management and union to break the impasse did not have any headway yesterday.

The Japanese global firm's Indian joint venture's plants are located at Bidadi, about 30 km from here, with a capacity to roll out about 700 cars a day, with an installed production of 3,10,000 units annually.

Of the 6,400 employees, about 4,000 are union members and the remaining are on contract in both the factories. — PTI

New Delhi, March 20
After two months of increase, natural gas production from Reliance Industries' eastern offshore KG-D6 block has again started to drop.

The output, which had risen to 13.63 million standard cubic meters per day in February, has dropped to 13.28 mmscmd this month, the Directorate General of Hydrocarbon said in a report to the Oil Ministry.

RIL produced a total of 13.58 mmscmd of gas from Dhirubhai-1 and 3 gas fields and MA oil and gas field in the KG-DWN-98/3 or KG-D6 block in the Bay of Bengal in the first week of February, which rose to 13.63 mmscmd in the following week. However, output has since dropped to 13.28 mmscmd in the week ending March 9, it said.

Production at KG-D6 had last month dropped to just about 11.7 mmscmd and MA-8 has helped reverse the falling trend of the past three years. — PTI

BRIEFLY

RBI Deputy Governor Chakrabarty resigns
New Delhi: In a surprise move, RBI Deputy Governor KC Chakrabarty has resigned three months before his term was to end. Chakrabarty has "requested to be relieved earlier than the scheduled (term ending June 15, 2014)," a top government source said. Chakrabarty, 62, who was appointed as RBI Deputy Governor in 2009, could not be contacted as he was travelling. — PTI

US court denies suit against M&M by dealers
New Delhi: A court in the US has denied a motion for 'class certification' in a lawsuit brought by US automobile dealers against Mahindra & Mahindra, the company said on Thursday. "The US District Court in Atlanta issued an order on March 14, 2014 denying the plaintiffs’ motion for class certification in a lawsuit brought by US automobile dealers against Mahindra & Mahindra," M&M said. — PTI

Intex launches Android smartphone at Rs 2,990
New Delhi: Intex Technologies on Thursday launched two entry-level smartphones for Rs 2,990 and Rs 4,490. The company said the devices are based on Android platforms and are targeted at widespread rural population who wish to replace their feature phones and use fully equipped smartphones to get a rich user experience at a much affordable price. — PTI

FDI inflows up 1.5% to $2.18bn in January
New Delhi: Foreign direct investment (FDI) into India grew by a meagre 1.5% to $2.18 billion in January, according to the data by the Department of Industrial Policy and Promotion. In January 2013, the FDI was at $2.15 billion. However, for the April-January period, FDI inflows dipped 2% to $18.74 billion from $19.1 billion during the corresponding period of the previous fiscal. — PTI