India overtakes Japan to become third-largest economy in purchasing power parity

Source: The Economic Times, Apr 19, 2012

NEW DELHI: Its economy may be in the grips of a slowdown, its polity paralysed and markets morose, but all this hasn’t prevented India from overtaking Japan to become the world’s third-largest economy in purchasing power terms.

Data just released by the International Monetary Fund (IMF) shows that India’s gross domestic product in purchasing power parity (PPP) terms stood at $4.46 trillion in 2011, marginally higher than Japan’s $4.44 trillion, making it the third-biggest economy after the United States and China.

Chambers disappointed, want a rate cut

Source: The Hindu Business Line, April 12, 2012

NEW DELHI: Expressing disappointment at 4 per cent growth in manufacturing, the FICCI President, Mr R.V. Kanoria, said, “A reduction in interest rates of at least 50 basis points should be seriously considered by RBI as part of its next monetary policy.”

There is need to cut the fiscal deficit to bring down interest rates and stimulate demand, said Mr Kanoria. FICCI predicts a 4.2-4.5 per cent industrial growth in 2011-12.

Government to set 25% floor for JV partners in FDI

Source: The Financial Express, April 08, 2012

New Delhi: The government is likely to define the term ‘joint venture’ for the purpose of foreign direct investment (FDI), under which it would be mandatory for at least two partners to have minimum 25% stake each in the JV company.

The definition of ‘joint venture’ will be incorporated into the consolidated FDI policy, which is to be unveiled shortly.

Stiglitz pat for Indian economy

Source: Business standard, Jan 12, 2012

Noted economist Joseph Stiglitz on Wednesday praised the Indian economy’s performance, saying the country had been doing a good job when institutions in the US and several other countries faltered. “India is doing a good job and has been pursuing a balanced and cautious policy,” he said.

Indian economy slides into danger zone; Investments plunge to 5 year low

Source: The Economic Times, Jan 11, 2012

MUMBAI: Investment proposals plunged to a five-year low in 2011 as companies such as GMR and Reliance Power halted projects due to administrative hassles, threatening to amplify the economic slowdown in 2012 and delay recovery even with rate cuts from the central bank.

A prolonged phase of weak investments could increase loan defaults by companies or call for restructuring of debt, denting banks’ profitability.

India Economic Summit to be shifted to Mumbai

Source: Business Standard, May 31, 2011

Mumbai: The Confederation of Indian Industry (CII) and the World Economic Forum (WEF) will host their annual India Economic Summit 2011 in Mumbai instead of New Delhi on November 20 and 21.

The summit, will, in its 27th edition, for the first time, be held in Mumbai. Under the theme, “Linking Leadership and Livelihood”, this year’s summit will focus on the critical governance reforms and innovative public private partnerships needed for India’s rapid and inclusive growth.

Forex reserves rise $1.69 b

Mumbai: Foreign exchange reserves were up by $1.69 billion to $272.783 billion, for the week ending June 11, on account of revaluation gains.

The reserves have risen after having fallen for two consecutive weeks.

For the week ended June 4, forex reserves fell by $877 million to $271.093 billion.

According to figures released in the Reserve Bank of India’s weekly statistical supplement, in the week , foreign currency assets were up by $1.689 billion to $247.241 billion.

Foreign currency assets expressed in dollar terms include the effect of appreciation or depreciation of non-US currencies. In the week under review, the euro had recovered its losses against the greenback, said a dealer with a public sector bank.

Gold reserves were unchanged at $19.423 billion. SDRs were up by $1 million at $4.821 billion. The reserve position in the IMF was unchanged at $1.298 billion.

Source : The Hindu Business Line. 22/06/10

RBI to buy back Rs 20,000 cr bonds to inject liquidity

Mumbai: The repurchase will be funded from the current account surplus of the government.

The Reserve Bank of India on Wednesday offered to buy back government bonds for up to Rs 20,000 crore to increase liquidity in the banking system. Payments towards advance taxes, licence fees for 3G telecom spectrum and broadband wireless access have taken cash out of the system.

As a first step, the RBI will offer to repurchase bonds for up to Rs 10,000 crore, the central bank said late today. The repurchase will be funded from the current account surplus of the government. There was short-term mismatch in funds, it said.

“The move is looking at addressing liquidity concerns in the market … It doesn’t necessarily preclude any rate action to tackle the inflation problem,’’ said Krishnamoorthy Harihar, treasurer at FirstRand Bank.

RBI will offer to repurchase 12.25 per cent government bonds maturing in 2010, 11.30 per cent 2010 bonds and 6.57 per cent, 2011 bonds on June 18. RBI will retain the right to vary the amount it may accept, or even reject all offers, it said.

Banks today borrowed about Rs. 27,705 crore through the two repos. Overnight call money rates rose to as high as 5.4 per cent, compared with the 5.25 per cent repo rate for borrowing from the RBI.

The step follows a measure announced on May 27, when the central bank permitted banks to borrow an additional amount up to half a percentage point of their SLR (statutory liquidity ratio) holdings. The measures were to be in effect from May 28 to July 2. The steps were initiated to improve liquidity, as the RBI anticipated pressures on account of the payments mentioned. It also opened a second auction to ensure funds remained available to banks.

The advance payment in the first quarter this year has been higher than the year-ago period. Forty four large companies that account for about 40 per cent of the total market capitalisation of the stocks listed on the Bombay Stock Exchange paid about 19.7 per cent higher advance taxes, or about Rs 7,273 crore, in the first quarter.

The winners of 3G and BWA licences are estimated to pay the government a little over Rs 1,00,000 crore, respectively Rs 68,000 crore and Rs 34,000 crore.

Source : Business Standard.  18/06/10

India-UAE trade may jump to $96 bn in 5 years

Dubai: Having replaced China as the UAE’s largest trade partner in 2008-09, India now expects to further bolster its bilateral trade with the West Asian emirate to $96 billion over the next five years.

This was stated by Federation of Indian Export Organisations (FIEO) president A Sakthivel at the inauguration ceremony of The India Show here.

Over 250 businessmen are participating in the trade festival, which aims to not only showcase India’s prowess in manufacturing and services but also position itself as an attractive investment destination.

Mr Sakthivel said India became UAE’s largest trading partner in 2009 with exports reaching $24 billion, a growth of 56% on a year-on-year basis.

“The pace at which the trade with UAE is growing, we expect it to double in the next five years. Dubai is the gateway to West Asia and North African countries and its importance has to be tapped in showcasing our position,” said Mr Sakthivel, adding that the non-oil trade between the two countries stood at $50 billion during the last fiscal.

The three-day business bonanza was inaugurated by UAE’s trade and commerce minister Sheikha Lubna on Tuesday. “There is high amount of interest in the show. It is a good platform for exporters and we expect good business from here,” Mr Sakthivel said.

The over 250 representatives from small, medium and large sectors include those from sectors like garments, textiles, home products, food and gift items, auto parts, fashion accessories, and information technology. According to FIEO, the buyer profile includes importers, distributors, retailers, manufacturers and suppliers.

Talking about the opportunities that Dubai offers in terms of trade, MK Lokesh, the Indian ambassador to UAE said, “It would be a modest target to have a growth rate target of 20-30%. We are exploring opportunities in fresh areas as well. Besides meat, spices and other items of business, we are planning to promote public-private-partnership in education, financial services, IT and real estate.”

As UAE’s largest trading partner, India accounts for almost 15% of country’s total commodity exchange. The main items of export from India include mineral fuel, gems and jewellery, cotton yarn, marine products and meat.

 Source : The Economic Times. 10/06/10

Govt revenue from 3G, BWA auctions to cross Rs 1 lakh cr

The government’s revenue from the auction of 3G and broadband wireless access (BWA) spectrum is all set to cross Rs 1 lakh crore, an almost three-fold increase over its initial projection of Rs 35,000 crore.

On the 12th day of BWA auction, the pan-India bid price reached Rs 10,652 crore, over six times the reserve price of Rs 1,750 crore.

While the total revenue from 3G and BWA auctions stood at Rs 99,675 crore as of today, the revenues from BWA auction, which is expected to end this week, have reached Rs 31,956 crore.

The government has already earned Rs 67,719 crore from the recently concluded 3G spectrum auction.

On the 12th day of BWA auction, Mumbai received the highest bid of Rs 1,804.30 crore, followed by Delhi at Rs 1,758.29 crore. Tamil Nadu came third with a bid of Rs 1,614.48 crore. All three circles have a reserve price of Rs 160 crore.

A total of 10 rounds were completed on Day 12. The activity level has already been set to 100 per cent.

BWA spectrum would enable Worldwide Interoperability for Microwave Access (WiMAX) services in laptops and desktops, which would allow consumers to access the Internet at a very high speed.

As many as 11 companies including Bharti Airtel, Reliance WiMax, Idea Cellular, Aircel, Qualcomm, Tata Communications Internet Services, and Vodafone Essar are participating in the BWA auction — a simultaneous online bid for two slots in each of the country’s 22 service areas.

The government has already allocated BWA spectrum to Mahanagar Telephone Nigam Ltd and Bharat Sanchar Nigam Ltd in their respective service areas and both will have to match the winning bid price.

Source : The Hindu Business Line. 08/06/10