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Mahindra to start Ssangyong due diligenceMahiMahindra Mahindra, India\'s largest utility vehicles and tractor maker, will start due diligence on troubled Korean SUV maker Ssangyong Motor in a day or two, a senior official said on Monday.Source: Moneycontrol Top Headlines | 14 Jun 2010 | 8:39 am Honda China lock workers say still on strikeHonWorkers at a factory making locks for Honda Motors cars in China remained on strike on Sunday, two workers said, although Honda said the dispute had been resolved and production had resumed.Source: Moneycontrol Top Headlines | 14 Jun 2010 | 8:39 am Have enabling resolution to raise $500m: Bhushan SteelIn an interview with CNBCTV18, Nitin Johri, CFO, Bhushan Steel Strips, spoke about the latest happenings in his company and sector.Source: Moneycontrol Top Headlines | 14 Jun 2010 | 6:52 am Singapore bourse signs agreement with HCL TechnologiesThe Singapore Exchange said on Monday it had signed a fiveyear IT infrastructure agreement with HCL Technologies for S$110 million (USD 78.6 million).Source: Moneycontrol Top Headlines | 14 Jun 2010 | 5:55 am Morgan Stanley\'s subsidiary buys more Parkway sharesUKbased FrontPoint Management LLP, a unit of Morgan Stanley bought 110,000 more shares of Parkway Holdings at S$3.85 a share for an investment client, the bank said in an exchange filing.Source: Moneycontrol Top Headlines | 14 Jun 2010 | 5:55 am Agricultural Bank of China to raise USD 23.1 bnThe Agricultural Bank of China is seeking to raise up to USD 23.1 billion through its Hong Kong and Shanghai dual listing, according to a term sheet obtained by Reuters on Monday and its previously released draft prospectus.Source: Moneycontrol Top Headlines | 14 Jun 2010 | 5:55 am Infosys changes iRace norms; to promote 8500 employeesIT major Infosys has made changes to the iRace which is its role and career enhancement initiative, reports CNBCTV18. Infosys has set up a subcommittee to relook at iRace.Source: Moneycontrol Top Headlines | 14 Jun 2010 | 5:42 am How do experts view Maran\'s acquisition of SpiceJet?From entertainment to \'highflying\' dreams! Being the market leader in the Southern television industry with its basket of successful channels, Sun TV promoter Kalanithi Maran has now put his foot in the aviation industry as he picked by 37.75% in lowcost carrier SpiceJet at Rs 47.25 per share amounting to Rs 750 crore.Source: Moneycontrol Top Headlines | 14 Jun 2010 | 4:52 am Assam Co didn\'t submit any bid: CanoroAssam Company had reportedly made an offer to buy out minimum 60% in Canoro Resources, Canada at $0.21. Talking about the proposed offer, Robert Wyne, President CEO, Canaro told CNBCTV18 that Assam company expressed desire but didnt submit bid.Source: Moneycontrol Top Headlines | 14 Jun 2010 | 4:29 am HCC divests stake, says will use funds to retire debtReal estate developer HCC has been on a divestment spree. Chief Financial Officer Praveen Sood says,\"We will get about Rs 300 crore from this sale and a part of this will be used to retire debts.\"Source: Moneycontrol Top Headlines | 14 Jun 2010 | 4:23 am May inflation at 10.16%: Will RBI act before July policy? - Moneycontrol.com
Source: Business - Google News | 14 Jun 2010 | 4:05 am India Infoline on RIL's telecom foray, top sector pick - Moneycontrol.com
Source: Business - Google News | 14 Jun 2010 | 4:05 am Indian forces to break Manipur blockade - AFP
Source: Business - Google News | 14 Jun 2010 | 4:01 am Inflation at 10.16%, spreads to non-food itemsDriven by spiralling prices of essential items, inflation surged into double digits at 10.16% in May, the highest in the last 19 months, adding to the woes of the common man.Source: India Business News | Business News - Times of India | 14 Jun 2010 | 3:54 am Volkswagen India Might Enter Into Small Car Segment Soon ! - Oneindia
Source: Business - Google News | 14 Jun 2010 | 3:48 am Dhanalaxmi Bank in tie-up with HDFC Mutual FundHDFC MF's schemes will be provided to the bank's customers through its 271 branches in over 130 cities and towns across the country.Source: Daily News & Analysis: Money News | 14 Jun 2010 | 3:47 am Hugo Chavez says beer tycoon Lorenzo Mendoza wants Venezuela presidencyIn recent weeks, president Hugo Chavez has frequently warned the tycoon that he could nationalize the brewer and food maker in his economic war on the bourgeoiseSource: Daily News & Analysis: Money News | 14 Jun 2010 | 3:45 am rupee gains as stocks rise; weak dlr boosts - Economic Times
Source: Business - Google News | 14 Jun 2010 | 3:44 am Sun TV founder to buy into SpiceJet; make open offerNEW DELHI/MUMBAI (Reuters) - Sun TV founder Kalanithi Maran's move to acquire a controlling stake in SpiceJet will boost expansion at the budget carrier, increase the clout of the sector and signals consolidation in the industry, analysts said on Monday.Source: Reuters: Money News | 14 Jun 2010 | 3:43 am Oil rises above $74 as Asian equities rallyBenchmark crude for July delivery was up 78 cents to $74.56 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange. The contract dropped $1.70 to close at $73.78 on Friday.Source: Daily News & Analysis: Money News | 14 Jun 2010 | 3:43 am Fitch revises rupee outlook to stable from negativeFitch Ratings has today revised the Outlook on India's Long-term local currency Issuer Default Rating (IDR) to Stable from Negative. At the same time, the agency affirmed India's Long-term foreign and local currency IDRs at 'BBB-'.Source: Reuters: Money News | 14 Jun 2010 | 3:41 am Sensex up 234 pts as bulls turn aggressive - Sify
Source: Business - Google News | 14 Jun 2010 | 3:39 am Delhi's water crisis ends - Sify
Source: Business - Google News | 14 Jun 2010 | 3:36 am Ambush marketing gives Nike leg up for World CupDETROIT (Reuters) - Nike Inc may not be a World Cup sponsor, but the athletic clothing and shoe giant is the top brand online for consumers tuned into the world's biggest soccer tournament.Source: Reuters: Money News | 14 Jun 2010 | 3:34 am Avg food inflation has stabilised - adviserNEW DELHI (Reuters) - India's average food price inflation has "virtually stabilised," the finance ministry's chief economic adviser Kaushik Basu said on Monday.Source: Reuters: Money News | 14 Jun 2010 | 3:21 am May inflation at 10.16 pct, higher than f'castNEW DELHI (Reuters) - - India's headline inflation unexpectedly accelerated in May, underlining the expectation the Reserve Bank would raise rates before its scheduled July review despite concerns over Europe's debt crisis.Source: Reuters: Money News | 14 Jun 2010 | 3:19 am Reliance Ind makes bold bet with foray in telecomsNEW DELHI/MUMBAI (Reuters) - Reliance Industries' re-entry into India's telecom sector will help the conglomerate tap opportunities in the untapped wireless data market as it aims to replicate growth of the mobile phone sector.Source: Reuters: Money News | 14 Jun 2010 | 3:01 am RIL makes bold bet with foray in telecomNew Delhi/Mumbai: Reliance Industries’ re-entry into India’s telecom sector will help the conglomerate tap opportunities in the untapped wireless data market as it aims to replicate growth of the mobile phone sector. On Friday, the energy major, controlled by Mukesh Ambani, the country’s richest man, unexpectedly agreed to buy Infotel Broadband, the only company to win a nationwide license in India’s auction for wireless broadband. The move by the deep-pocketed group would mean more competition for Indian telecoms firms, for whom voice has been the primary source of revenue so far, but are now also expanding into wireless data. “I don’t think Reliance is looking at this business being profitable in at least the next two years,” said Sonam Udasi, head of research at IDBI Capital in Mumbai. “Their past track record in areas apart from their core business has not been great,” he said, referring to the petrochemicals-to-refining conglomerate’s foray into businesses such as retail. Mukesh been quick off the blocks to pursue deals after a long-running feud with his younger brother Anil ended last month and the brothers revoked a non-compete agreement. Reliance, India’s largest-listed firm, aims to offer wireless broadband connectivity to both retail and corporate clients across a vast geography, the company said. A spokesman for Reliance said company would invest about $5 billion in the telecom venture over the next two years, including the broadband spectrum fee to be paid by Infotel. Reliance will take a 95% stake in start-up Infotel Broadband, the only firm to win a nationwide licence in India’s broadband wireless spectrum auction. Infotel’s offer of $2.75 billion for the license topped forecasts while US chipmaker Qualcomm and India’s biggest mobile operator, Bharti Airtel, also won spectrum in parts of the country in an auction that saw some of the biggest players in Indian telecoms emerge empty-handed. Growth in wireless broadband Reliance aims to replicate India’s mobile phone growth story in the broadband segment and expects broadband connections to grow rapidly in the next three years, according to a corporate presentation on its website. India is the world’s second-biggest and the fastest-growing mobile market with more than 600 million users. Analysts however said it won’t be easy for India’s top conglomerate to start making money immediately as next-generation broadband technologies such as long-term evolution (LTE) haven’t yet been launched and the catch up in a price sensitive market such as India could be slow unless services are affordable. HSBC Securities analysts wrote in a note they expected the broadband business to contribute less than 5% of the company’s EBITDA and less than 2% at the earnings per share level, even assuming an aggressive business approach. “But here I think they (Reliance) have taken a call because this is the lowest point in the telecom sector in India,” Udasi said. Shares in Reliance Industries, valued at $74 billion, were up 1% by 0820 GMT, in a Mumbai market up 0.8%. Analysts say it is possible for Reliance to offer voice services using the wireless spectrum Infotel has won in the auction, but the company is likely to focus on the high-margin data business first. “The intent is clearly data,” said Kamlesh Bhatia, principal analyst at technology research firm Gartner. “Voice clearly is highly commoditised.” India’s broadband penetration -- connections per 100 people -- is extremely low at 0.74, whereas more than half of the population have a telephone, according to the Indian telecoms regulator. Just 4-5% of the country’s mobile subscribers access Internet on their phones, analysts estimate. Mobile operators currently get only 10% of their revenue offering data services. China, the world’s biggest telecoms market, had 130 million broadband subscribers, Reliance said in the presentation, expecting India to catch up in three to four years. Mukesh, the world’s fourth-richest man, is not new to telecoms and had in fact built Reliance Communications before giving control to Anil after the brothers split up the family empire in 2005. “Reliance’s entry is going to create a disruptive sort of impact on the market in terms of pricing for data access,” said Gartner’s Bhatia. Source: Home - Livemint.com | 14 Jun 2010 | 2:57 am Obama leadership on BP spill faces testing weekWASHINGTON/LONDON (Reuters) - Barack Obama's leadership of the Gulf of Mexico oil spill faces key tests this week as the U.S. president gives his first national address on the disaster and meets top BP executives for the first time.Source: Reuters: Money News | 14 Jun 2010 | 2:50 am GLOBAL MARKETS - Investors keep up rally from year lowsLONDON (Reuters) - World stocks headed for a fourth straight day of gains on Monday as investors banked on global economic recovery to trump concerns such as euro zone sovereign debt in providing a positive backdrop for corporate earnings.Source: Reuters: Money News | 14 Jun 2010 | 2:31 am No date yet for fuel price panel meet - officialNEW DELHI (Reuters) - The government is yet to decide a date for the next meeting of a ministerial panel set up to look into freeing up fuel prices, a top oil ministry official said on Monday.Source: Reuters: Money News | 14 Jun 2010 | 2:30 am Inflation accelerates in MayNew Delhi: India’s headline inflation unexpectedly accelerated in May, underlining the expectation the Reserve Bank of India (RBI) would raise rates before its scheduled July review despite concerns over Europe’s debt crisis. The data came along with a sharp upward revision of March’s reading and on the heels of April manufacturing output matching its fastest pace in 15 years, indicating strong growth and rising inflationary pressures in Asia’s third largest economy. “This increases the likelihood of an intermeeting rate hike from the RBI as inflationary pressures are really showing up,” Sebastien Barbe, the Hong Kong-based head of emerging markets research and strategy at Credit Agricole. “It seems like the markets are also now less worried about the situation in Europe, so the RBI may be less reluctant to tighten before July.” The 10-year bond yield rose 6 basis points to 7.67% after the data, while one-year indexed swap rates also rose 5 basis point. Stocks trimmed gains. The one-year overnight indexed swap rate has risen over 50 basis points from a more than 5-month low of 4.71% touched in early May on concerns over tight liquidity in the banking system and expectations of higher policy rates. Many analysts had earlier been expecting the RBI to wait till its 27 July review meeting to raise rates, expecting Europe’s woes and expected tight market liquidity to stay its hand. That view is now changing. “RBI will increase the frequency of its baby steps and we expect some tightening measures in June itself and a repetition of those in the July policy,” Rupa Rege Nitsure, chief economist at Bank of Baroda in Mumbai, said. “Baby steps” to normalise monetary policy is what the RBI has said is its preferred choice of action, but it has also kept open the option of a rate hike ahead of the July review to combat inflation which it deems “worrisome.” The wholesale price index (WPI) rose an annual 10.16% in May, higher than the median forecast for 9.56% in a Reuters’ poll and April’s 9.59%. In a sign the May reading could be an underestimate, March inflation was revised to 11.04% from the earlier estimate of 9.90%. Recent WPI data have been similarly revised up. Stubbornly high inflation poses a political risk for the Congress party-led government, with voter sentiment possibly turning against it before eight state elections in 2010 and 2011. It would also dampen enthusiasm for reforms, such as a keenly awaited freeing up of retail fuel prices, crucial to improving public finances and stop state-run fuel retailers from bleeding. The government deferred last week taking a decision on freeing fuel prices, worried about political opposition and the impact on prices. Policymakers expect inflation to ease on better prospects for crops from good monsoon rains. But a hike in fuel prices, which is being discussed by the government, could push it up, an adviser has said. Finance secretary Ashok Chawla told Reuters ahead of the data release that inflation was grounded in supply-side problems and would come down to 5-6% by December. Source: Home - Livemint.com | 14 Jun 2010 | 2:21 am Oil up toward $75 on recovery optimism, weaker dollarSingapore: Oil climbed as much as 1.5% toward $75 on Monday as renewed optimism about the global economic recovery rekindled appetite for risk, sending Asian stock markets to a one-month high and the dollar down. European leaders will meet on Thursday to set out proposals to convince financial markets they can contain a debt crisis by agreeing to tighten economic policy coordination and strengthen budget discipline. “Some of the fears about the European debt crisis are easing,” said Tony Nunan, a risk manager with Tokyo-based Mitsubishi Corp. The dollar weakened about 0.8% against a basket of currencies, with the euro at a one-week high, while Japanese stocks rose led by the technology sector as the nation’s manufacturers grew more optimistic about the business environment in the April-June quarter. “If the dollar is falling, it means that people are more relaxed to take on risk. People have believed for a long time that the second half (of the year) will be better than the first half,” Nunan said. US crude for July rose as much as $1.14 to $74.92 a barrel and was up $1 at $74.78 a barrel at 1:18pm, still down 14% from a 19-month high above $87 in early May. ICE Brent gained 89 cents to $75.24. US crude prices last week posted just their second weekly gain in six weeks, up 3.2%, after strong Chinese export data signaled fast-paced demand by the world’s second largest oil consumer is weathering sluggish economic growth in the key European market. World stocks and the dollar rose on Friday after a surprisingly strong reading of US consumer sentiment buoyed recovery prospects, even as an unexpected drop in the country’s retail sales damped risk appetite. US crude would have to settle above $76, a level reached in intraday trade last week for the first time in four weeks, for prices to extend their upward march, Nunan said, based on chart analysis. Oil consumption in the US is recovering, helped by the seasonal summer peak in gasoline use. The nation’s crude inventories fell more than expected in the last week of June, reducing a surplus that has prevailed for almost two years. Crude fell to below $65 a barrel in mid-May as the European debt crisis unfolded. “We had a price correction and hopefully inventory has peaked; as we go into the summer, U.S. demand is going to increase,” Nunan said. “We have recovered some of the pretty good momentum that we had at the beginning of last week.” BP’s Gulf of Mexico oil spill will affect US petroleum supplies as soon as the third quarter, according to JP Morgan. The administration of US President Barack Obama has delayed plans to permit new offshore drilling as a result of the environmental disaster. “With the US drilling ban likely to hit supplies from the third quarter onwards, and demand expected to rise seasonally between now and August, we feel that seasonality and fundamentals are moving towards a price rebound,” JP Morgan analysts headed by Lawrence Eagles said in a report dated 11 June. “Overall, while risks remain, we believe that the oil market will start to tighten up over the coming months.” Source: LatestNews-Home - Livemint.com | 14 Jun 2010 | 2:10 am Budget deficit may drop to 4.5%: ChawlaNew Delhi: India may be able to cut its fiscal deficit to 4.5% of GDP by March 2011 due to revenues from 3G auctions and robust economic growth, finance secretary Ashok Chawla told Reuters on Monday. The sale of third generation mobile phone licences and broadband access are bringing in some $23 billion into state coffers, and a narrower deficit should help the government reduce its record Rs4.57 trillion ($97.75 billion) in borrowing that had been expected in the fiscal year to next March. “This seems a reasonably accurate projection particularly in the light of the increased non-tax revenue from the telecom auction and the robust growth which the economy is showing,” Chawla said in an interview in the Dealing Room, a Reuters Messaging chat room. Chawla said the 3G auctions by themselves had the potential to cut the deficit by about 100 basis points by March 2011. He also said the government was “very keen” to restrict India’s fiscal deficit. Chawla said: “I do not see any chance of it exceeding the projected 5.5% (in this fiscal year).” India had projected a budget deficit of 5.5% for the fiscal year that ends in March 2011, down from a 16-year high of 6.9% of GDP in the last fiscal year. Inflation a Supply Side Problem Chawla said inflation would ease, despite government data that showed prices accelerating in May. “Inflation is grounded in supply side problems and the base effect since we view it on a year-on-year basis,” Chawla said. He said while supply side constraints would keep inflation at an elevated level, broader pricing pressures were easing. “Inflation is slowly but definitely moving southward. Supply side constraints will no doubt keep it elevated more than normal levels. It should be in region of 5-6% by December 2010 as mentioned by the Prime Minister.” The wholesale price index, the central bank’s most closely watched gauge of inflation, rose an annual 10.16% in May, faster than analysts’ expectations, driven by higher food and fuel prices, government data showed on Monday. India’s 10-year bond yield rose as much as 4 basis points after inflation data for May came in above market expectations. The higher-than-expected headline inflation figure has again raised calls for a hike in key policy rates even ahead of the 27 July policy review by the RBI. “It is a close call as the liquidity situation is not very easy, but the RBI may tighten by 25 basis points before July, more to give a signal that it is willing to do what it takes to manage inflationary expectations”, said analyst Sebastien Barbe, head of Emerging Markets at Credit Agricole, Hong Kong. However, the finance secretary said that high inflation levels are mainly a supply side problem, hinting that raising rates may not be a solution. Source: Home - Livemint.com | 14 Jun 2010 | 2:08 am See re-rating in SpiceJet stock IDFC Sec - Moneycontrol.com
Source: Business - Google News | 14 Jun 2010 | 1:59 am Rupee largely steady tracking sharesMumbai: The Indian rupee continued to trade largely steady near a fresh one-week high on Monday afternoon tracking gains in the domestic sharemarket and also boosted by the dollar’s losses against major currencies. By 1:05pm, the partially convertible rupee was at Rs46.60/61 per dollar, after hitting 46.56, its highest since 3 June and 0.5% stronger than Friday’s close of Rs46.84/85. The performance of the stock market would also be crucial for direction as foreign fund flows influence the rupee’s fortunes, dealers said. Indian shares were trading up nearly 1% with Reliance Industries leading the rise, taking cues from strong Asian markets. Traders were also watching the dollar’s moves versus majors for direction. The index of the dollar against six major currencies was 0.7% lower. Most regional currencies were stronger compared to the dollar. The euro rose on Monday after a burst of short-covering lifted the single currency above $1.22 and further away from a four-year low, but traders were wary about chasing gains and expected its downtrend to continue. One-month offshore non-deliverable forward contracts were quoted at Rs46.71, weaker than the onshore spot rate. In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange and MCX-SX were at Rs46.6850 and Rs46.6825 respectively, with the total traded volume on the two exchanges at about $980 million. Source: Home - Livemint.com | 14 Jun 2010 | 1:54 am Crude oil futures trade higher on global cuesCrude oil prices rose by Rs 12 or 0.35 per cent to Rs 3,490 per barrel in futures market on Monday, as traders created fresh positions on the back of a firming global trend.Source: HindustanTimes.com - Top Business News Headlines | 14 Jun 2010 | 1:33 am Reliance Industries to invest in power sector: ReportThe largest listed Indian company has identified power, telecommunications, financial services and pharmaceuticals for investments in the near futureSource: Daily News & Analysis: Money News | 14 Jun 2010 | 1:25 am Macquarie puts 'underperform' on HUL - Economic Times
Source: Business - Google News | 14 Jun 2010 | 1:01 am Inflation accelerates to 10.16 per cent in MayIndia's headline inflation accelerated to 10.16 per cent in May, raising the possibility of the Reserve Bank of India hiking rates even before a scheduled policy review on July 27.Source: HindustanTimes.com - Top Business News Headlines | 14 Jun 2010 | 12:34 am AirAsia begins Kuala Lumpur-Yangon flight in JulyBudget carrier AirAsia said today it would start flights from its Kuala Lumpur base to Yangon next month, completing an expansion to all 10 Southeast Asia countries. The first flight to the Myanmar capital would be July 20, the carrier's statement said. Promotional one-way fares start from 29 ringgit ($8.80).Source: HindustanTimes.com - Top Business News Headlines | 14 Jun 2010 | 12:15 am Power regulator says bidding will be tariff-based from JanuaryThe Central Electricity Regulatory Commission (CERC) has firmly ruled in favour of shifting to a tariff-based competitive bidding regime for future power projects from January, citing better price discovery and lower retail tariffs through theSource: Business Line - Home Page | 14 Jun 2010 | 12:00 am Investor interest in gold continues to be strongAre commodity markets readying for a bounce back? This is the multi-million dollar question uppermost in the minds of most market participants. While uncertainties in the global marketplace have been the cause of pessimistic sentiment andSource: Business Line - Home Page | 14 Jun 2010 | 12:00 am Hedging aimed at revenue protection: InfosysThe element of uncertainty involved in the currency environment is challenging for business, said Mr S. Gopalakrishnan, Chief Executive Officer and MD, Infosys TechnologiesSource: Business Line - Home Page | 14 Jun 2010 | 12:00 am Positive bias likely in indicesThe key indices are likely to breach their nearest resistance this week and likely to stay at the higher end of the current range. If the global markets do not throw up fresh negative developments, Dalal Street may attempt to push the upperSource: Business Line - Home Page | 14 Jun 2010 | 12:00 am Dividends grow faster than profits in FY 10After slashing dividends in the previous year, corporates have hiked pay-outs quite sharply inSource: Business Line - Home Page | 14 Jun 2010 | 12:00 am Incois beats peers to rule out Indian Ocean tsunamiThe Hyderabad-based Indian National Centre for Ocean Information Services (Incois) beat peers to it while assessing ‘no tsunami threat' for India from the midnight–temblor that rocked the Andaman and NicobarSource: Business Line - Home Page | 14 Jun 2010 | 12:00 am Day Trading GuideFresh short position is recommended only if the stock declines below Rs 257 with tightSource: Business Line - Home Page | 14 Jun 2010 | 12:00 am Man Industries – BuyInvestors with medium-term perspective can consider buying the stock of Man IndustriesSource: Business Line - Home Page | 14 Jun 2010 | 12:00 am Gold futures may test resistanceComex gold futures ended higher Friday on lingering worries about economic recovery and a euro zone credit crisis. Bullion recovered after falling on Thursday when safe-haven demand decreased after the stock markets advanced. Comments from ChinaSource: Business Line - Home Page | 14 Jun 2010 | 12:00 am Reliance Ind to invest $1 billion in roll-out of telecom networkReliance Industries plans to invest $1 billion over the next one year, for rolling out telecommunication networks required for its newly acquired broadband venture, the company toldSource: Business Line - Home Page | 14 Jun 2010 | 12:00 am China's AgBank seeks record $23 bln IPO - documentsHONG KONG (Reuters) - The Agricultural Bank of China is seeking to raise more than $23 billion through a dual Hong Kong and Shanghai listing, according to documents on Monday, putting it on course for the world's biggest IPO.Source: Reuters: Money News | 13 Jun 2010 | 11:55 pm SpiceJet surges over 6 pc ahead of open offer by MaranLow-cost airline SpiceJet on Monday soared over six per cent in morning trade on the Bombay Stock Exchange ahead of an open offer by Kalanithi Maran, who has acquired 37.75 per cent stake in the company for an estimated Rs 750 crore.Source: HindustanTimes.com - Top Business News Headlines | 13 Jun 2010 | 11:53 pm 'Google collected private data from Spanish Wi-Fi networks'Google has "illegally" collected private data from Wi-Fi networks in Spain through its Street View project, a crime prevention association said on Sunday. Source: HindustanTimes.com - Top Business News Headlines | 13 Jun 2010 | 11:32 pm Sensex advances 172 points in morning trade led by RILThe Sensex, which gained 142.87 points in the previous trading session, added another 172.71 points to touch 17,237.66 in the first five minutes of trading.Source: Daily News & Analysis: Money News | 13 Jun 2010 | 11:06 pm Rupee appreciates by 26 paise against dollar in early tradeThe rupee appreciated by 26 paise to 46.57 a dollar in early trade today, supported by gains in the stock market. The rupee had closed 12 paise higher at 46.83/84 against the dollar in Friday's trading.Source: HindustanTimes.com - Top Business News Headlines | 13 Jun 2010 | 11:03 pm Reliance Industries shares rise after telecom buyNew Delhi: Shares in Reliance Industries rose more than 2% on Monday after the petrochemicals-to-refining conglomerate agreed to buy a telecoms firm, giving it a foothold in the fast-growing market. Billionaire Mukesh Ambani, who controls Reliance Industries, has been quick off the blocks after a long-running feud with his younger brother Anil ended last month and a pact to not compete with each other was revoked. On Friday, Reliance Industries said it would take a 95% stake in Infotel Broadband, which was the only company to win a nationwide licence in India’s broadband wireless spectrum auction. A spokesman for the India’s largest-listed firm said on Monday the company would invest about $5 billion in the telecom venture over the next two years, including the broadband spectrum fee to be paid by Infotel. At 10:26am, shares in Reliance Industries with a market value of $73 billion, were up 1.4% at Rs1,061.20 in a Mumbai market that had gained 0.9 percent. Reliance shares had risen as much as 2.2% in early deals. More than 1 million Reliance shares had changed hands on the National Stock Exchange, compared with full-day average volume of 4.8 million for the past 30 days. Mukesh Ambani, the world’s fourth-richest man, had been widely expected to return to the telecom market after Reliance Communications that he had built went to Anil after the brothers split up the family empire in 2005. Reliance Industries expects broadband connections in India to grow rapidly in the next three years, while mobile broadband is likely to be the primary means of high-speed access, the company said in a presentation on its website. China, the world’s biggest telecoms market, had 130 million broadband subscribers, Reliance said in the presentation, adding India can catch up in three to four years. India’s broadband penetration -- connections per 100 people -- is extremely low at 0.74, whereas more than half of the population have a telephone, according to the Indian telecoms regulator. Reliance has said it would have an “asset light approach” and would collaborate with technology firms and network infrastructure providers as it rolls out a broadband network all across a vast geography. Source: Home - Livemint.com | 13 Jun 2010 | 11:03 pm Rupee up by 26 paise against dollarThe rupee appreciated by 26 paise to 46.57 a dollar in early trade today, supported by gains in the stock market.Source: India Business News | Business News - Times of India | 13 Jun 2010 | 11:01 pm Primus Australia's Ravi Bhatia new vice chairman of AIBCIndustry body Australia India Business Council, promoting trade and investment between the two countries, has appointed Primus Australia's CEO Ravi Bhatia as vice chairman.Source: HindustanTimes.com - Top Business News Headlines | 13 Jun 2010 | 11:00 pm RIL to invest $5 bn in telecomMumbai: Reliance Industries, which decided to buy a telecom firm last week, will invest about $5 billion in the venture over the next two years, a spokesman for the petrochemicals-to-refining conglomerate said. On Friday, Reliance Industries made a dramatic return to telecom, agreeing to buy Infotel Broadband, which was the only company to win a nationwide licence in India’s broadband wireless spectrum auction. The planned investment includes broadband spectrum fee of about $2.75 billion to be paid by Infotel, the spokesman said. Source: Home - Livemint.com | 13 Jun 2010 | 10:56 pm Reliance Industries to invest $5 bln in telecomsReliance Industries, which decided to buy a telecoms firm last week, will invest about $5 billion in the venture over the next two years, a spokesman for the petrochemicals-to-refining conglomerate said. Source: HindustanTimes.com - Top Business News Headlines | 13 Jun 2010 | 10:27 pm Sensex advances 172 points in morning trade led by RILThe Bombay Stock Exchange (BSE) benchmark Sensex opened over 172 points up today on buying in heavyweight stocks, led by Reliance Industries. The Sensex, which gained 142.87 points in the previous trading session, added another 172.71 points to touch 17,237.66 in the first five minutes of trading. Source: HindustanTimes.com - Top Business News Headlines | 13 Jun 2010 | 10:15 pm Markets continue to move up, NTPC, BHEL dipThe Bombay Stock Exchange (BSE) benchmark Sensex opened over 172 points up on Monday on buying in heavyweight stocks, led by Reliance Industries.Source: India Business News | Business News - Times of India | 13 Jun 2010 | 10:06 pm US court grants injunction against Dr Reddy's LaboratoriesDr. Reddy' disagrees with the court's decision and intends to appeal, the company said in a statement over the weekend.Source: Daily News & Analysis: Money News | 13 Jun 2010 | 9:58 pm Vuvuzelas stir online debate at World CupCape Town: You either love them or you hate them and the vuvuzela is stirring up some impassioned debate on Facebook, YouTube and other sites online. The one-metre long plastic trumpet is as essential an item to South African fans as getting decked out in the national colours or painting one’s face and they have been out in force in the opening days of the tournament. Eighty thousand of them being blown at full volume sounds like a swarm of angry bees buzzing in your ear, or, as one newspaper put it, an elephant in distress. It is a tuneless din that takes getting used to, and they are not just being blown at stadiums, but in hotel lobbies, in shopping malls, and on the streets. “It’s our way to motivate players, to express happiness and how do you feel in the stadium,” said 23-year-old Sazi Mhlwatika as he shopped in Johannesburg. “We are used to them and you can’t enjoy the game without vuvuzelas. If there’s no vuvuzelas, there is no game. It’s just a traditional thing in South Africa. Abroad, they sing from the first minute to the end, here we blow vuvuzelas from the beginning to the end.” But not everyone is embracing them with shops in Cape Town running out of “vuvu-stopper” earplugs. “I could have sold 300 pairs of earplugs yesterday if I’d had the stock, and the same today, but I’ve only got 200 pairs and that’s just about finished,” one local shopkeeper said. “We can’t keep up,” added the owner, who has ordered 1,000 more. Another said they ran out last week. “We’re already deaf,” she said. The earplugs, marketed as the “Vuvu-Stop”, have a label on the back of the packet which reads: “Highly effective noise reduction. Uses include soccer, rugby, or for couch potatoes to block out your wife’s moaning.” They claim to have a noise-reduction rating of 31 decibels. This helps given Switzerland’s Hear the World Foundation - an initiative to raise awareness about hearing loss - said tests showed that, at full volume and pressed against your ear, a vuvuzela (127 decibels) is louder than a chainsaw (100 decibels). Studies have also shown they contribute to the spread of cold and flu germs. It appears the trumpets have also hurt the sensibilities of some foreign players, who have lobbied for it to be outlawed, claiming it affects their concentration. The drone has also attracted plenty of disparaging comments online. One You Tube video providing an insight into the instrument has been viewed by 250,000 people, and it seems many don’t like it. “What an absolutely disgraceful, ear-wrenching noise,” wrote one person. Another said: “The TV stations need to create some sort of noise filter.” On Facebook, numerous pages have sprung up calling for a vuvuzela-free World Cup. There is even a website dedicated to getting rid of the horn -- www.banvuvuzela.com It is running a poll, asking people to vote for or against the trumpet at the World Cup. As of Sunday, nearly 30,000 wanted it banned while only 6,500 wanted it to stay. But FIFA president Sepp Blatter has given them his blessing, blasting the detractors by telling them Africa is about dance and music and moaning about the instrument bordered on discrimination. And there is little sympathy for sufferers from World Cup organisers, who insist that the vuvuzelas are a potent symbol of the tournament, the first time the World Cup has been held on African soil. “Everybody loves vuvuzelas,” said Rich Mkhondo, spokesman for the local organising committee. “They are the symbol of the tournament.” Vuvuzelas are said to be based on kudu horn instruments and rooted in African history, blown to call villagers to meetings. The plastic version started to be mass-produced in 2001. Source: LatestNews-Home - Livemint.com | 13 Jun 2010 | 9:26 pm Asia stocks at 1-month high; euro bouncesHong Kong: Asian stocks rose to a one-month high on Monday, led by a rally in the technology sector, while the euro rebounded in thin trade, squeezed higher by dealers closing out of bets against the currency. Global equities are set for a fourth consecutive session of gains, with the growth-sensitive materials sector likely to be in the driver’s seat again after being one of the most heavily sold sectors in recent months as investors cut exposure to riskier assets, fearing the worldwide recovery was losing momentum. However, tech stocks were leading major indexes in Japan and South Korea higher, after semiconductor chipmakers last week gave positive news about demand, helping Wall Street recover early losses on Friday. The fundamental picture has not changed much, with many economists still expecting the US economy to grow around 3% this year and next, even after May US retail sales unexpectedly fell for the first time in eight months. “We’re seeing pretty active short-covering on a sense that recent risk avoidance moves were exaggerated, leaving markets oversold,” said Takashi Ushio, head of the investment strategy division at Marusan Securities in Tokyo. Japan’s Nikkei share average rose 1.7%, with tech names TDK, NTT Data and Kyocera Corp all among the biggest boosts to the index. NTT Data gained 2.7%. The market for semiconductors will likely grow 6 to 7% for the next five years, helped by strong demand in China, Morris Chang, Taiwan Semiconductor Manufacturing Co’s chief executive and chairman, told the Financial Times. The MSCI index of Asia Pacific shares outside Japan climbed 1.1% to the highest since 19 May. The index is trading at 11.5 times its earnings expected 12 months forward, a bit higher than at the beginning of June but still cheaper than the 5-year average of 13.2 times, Thomson Reuters I/B/E/S data showed. With bets against the euro near record highs and bets on the Australian dollar slashed last week, dealers were prone to taking advantage of the relative quiet and trimming their positions. The euro was up 0.4% to $1.2172, having earlier triggered small stop-loss orders all the way up to around $1.2207 This week the focus for the euro will be a meeting of European Union leaders on Thursday to convince sceptical investors they can tighten budgets to contain a sovereign debt crisis and boost growth at the same time. The Australian dollar was up 0.5% to US$0.8560, having strengthened by nearly 4 cents in the last week. Short-term investors in the International Monetary Market cut their bets on the Australian dollar in half in the week to 8 June, suggesting that positioning will not be an obstacle to further strength in the currency. The Korean won leapt around 1.5% a relief rally after Seoul announced foreign exchange regulations over the weekend that were largely in line with expectations. The weaker dollar was one of the factors pushing up oil prices. US crude for July delivery rose 1.1% to $74.56 a barrel Since crude traded at a 10-month low on 20 May, it has drifted higher and gained $10. Source: Home - Livemint.com | 13 Jun 2010 | 9:19 pm Markets rise 0.9%; Reliance leadsMumbai: Indian shares rose 0.9% in early trade on Monday, with Reliance Industries leading the rise after the energy major agreed to buy a telecoms firm. At 9:03am, the 30-share BSE index was up 0.88% at 17,214.78 points, with 29 components advancing. It rose as much as 1%. The 50-share NSE index was up 0.8% at 5,161.40. Billionaire Mukesh Ambani-led Reliance Industries made a dramatic return to telecoms, agreeing to buy Infotel Broadband on Friday, which was the only company to win a nationwide licence in India’s broadband wireless spectrum auction. The stock was up 1.9% at Rs1,065.70. Source: Home - Livemint.com | 13 Jun 2010 | 9:08 pm Israel to set up own inquiry into Gaza ship raidJerusalem: Israel said on Sunday it would set up its own investigation into a deadly raid on a convoy of Gaza-bound aid ships, and that its panel would include two foreign observers. The internal inquiry into the 31 March raid, which falls short of a UN proposal for an international investigation, was decided on after consultations with the United States. The White House welcomed the move as an important step and said Israel was capable of conducting a fair investigation. “But we will not prejudge the process or its outcome, and will await the conduct and findings of the investigation before drawing further conclusions,” White House spokesman Robert Gibbs said in a statement. Israeli Prime Minister Benjamin Netanyahu’s office said in a statement the government would give its final approval on Monday to forming an “independent public commission” into whether or not Israel had conformed to international law in imposing a naval blockade on the Hamas-ruled Gaza Strip. Israel said its commandos killed nine pro-Palestinian Turkish activists when they boarded a Turkish-flagged aid vessel and were attacked by passengers wielding metal rods and knives. The committee will examine the flotilla members, as well. Amid an international outcry over the bloodshed, Israel has faced mounting pressure to investigate the events surrounding the flotilla raid and to ease or lift its blockade. Hamas Islamists, who refuse to recognise Israel and renounce violence, seized control of the Gaza Strip in 2007. Netanyahu said on Sunday Israel would continue discussions with the international community to prevent weapons and military equipment from reaching Gaza and to allow in humanitarian aid, an apparent signal it was open to revising blockade procedures. The statement said a retired Israeli Supreme Court judge, Jacob Turkel, would head a committee on which two other Israelis and the two foreign observers would sit. “In light of the exceptional circumstances of the incident, it was decided to appoint two foreign experts who will serve as observers,” the statement said. The statement listed David Trimble, a Northern Ireland politician and Nobel Peace Prize winner, and Canadian jurist Ken Watkin as the foreigners who would take part in the hearings and deliberations but not have the right to vote. “The commission may request any information from the Prime Minister, the Minister of Defence, other ministers and the Israel Defence Forces Chief-of-Staff,” the statement said. The Israeli military has announced its own investigation, focusing on the operational aspects of a raid seen by many in Israel as a fiasco in which planners failed to gauge the strength of resistance on board. Officers and soldiers would not testify at the government-ordered inquiry, which would rely on the statements they made to the military panel, Netanyahu’s office said. The commission will publish its report when finished. “While Israel should be afforded the time to complete its process, we expect Israel’s commission and military investigation will be carried out promptly,” the White House statement said. “We also expect that, upon completion, its findings will be presented publicly and will be presented to the international community.” Source: LatestNews-Home - Livemint.com | 13 Jun 2010 | 8:47 pm Mama mia: Maternity clothes mkt set to touch Rs 1000crShilpa M V is having a great time shopping. In her second trimester of pregnancy, the HR professional is pampering herself with a new wardrobe to accommodate her baby bump.Source: India Business News | Business News - Times of India | 13 Jun 2010 | 4:31 pm 15 cos in race for one tele vendorFifteen companies, including British Telecom, have been shortlisted by the government to select a telecom vendor which will certify equipment imported by various mobile companies into the country, especially from China.Source: India Business News | Business News - Times of India | 13 Jun 2010 | 4:26 pm 'Inflation to determine RBI's move'The PM's economic panel has said inflation, and not factory output numbers, should determine the RBI's move on monetary policy, even as analysts expect RBI to further tighten money supply after robust industrial growth in April.Source: India Business News | Business News - Times of India | 13 Jun 2010 | 4:24 pm Mediclaim portability to become a reality soonMediclaim policyholders, who are not satisfied with the service of their existing service providers, will be able to switch to another insurer soon without any change in the premium outgo.Source: India Business News | Business News - Times of India | 13 Jun 2010 | 4:22 pm JWT-Kolkata team wins Brand Equity Quiz 2010The national finals of The Idea Brand Equity Quiz 2010 witnessed history with two advertising agencies battling for the most coveted quizzing trophy in India Inc.Source: India Business News | Business News - Times of India | 13 Jun 2010 | 4:20 pm Marketers cash in on football frenzyAs the world's leading players take to the pitch in South Africa, a new kind of soccer mania has gripped the Indian streets.Source: India Business News | Business News - Times of India | 13 Jun 2010 | 4:09 pm Godrej may wind up acquisition panelAfter going on a global acquisition spree to strengthen its position in overseas markets, Godrej Consumer Products (GCPL) is now on a consolidation drive.Source: India Business News | Business News - Times of India | 13 Jun 2010 | 4:04 pm Planets remain in a disruptive alignmentWhile Jupiter and Uranus can cosmically underwrite some risk taking, Saturn is only two degrees away from its exact aspect.Source: Daily News & Analysis: Money News | 13 Jun 2010 | 3:29 pm Early part of week looks optimisticThe sectoral story was a mixed bag as the rally was seen in the mid-cap index with the banking index almost unchanged and technology stocks showing declines.Source: Daily News & Analysis: Money News | 13 Jun 2010 | 3:28 pm Tech Mahindra: The numbers still don't add upRevisiting transactions to determine whether they represent commercial rationality or not.Source: Daily News & Analysis: Money News | 13 Jun 2010 | 3:22 pm India should be benchmarked for its best practices: Robert CampRobert Camp, chairman, Global Benchmarking Network, Best Practice Institute, USA speaks to DNA about the practice of benchmarking.Source: Daily News & Analysis: Money News | 13 Jun 2010 | 3:19 pm Naveen agrees to visit Posco steel plant site - The Hindu
Source: Business - Google News | 13 Jun 2010 | 1:45 pm Rise of India’s caste warriorDubai, Ghaziabad: Caste is most often seen through the prism of conflict—the heated national debates about reservations, the political polarization on the census and the attacks on young couples that have been blessed by caste panchayats. But far away from the spotlight, there is the more benign world of organizations and activists who continue to nurture informal networks based on caste, to help fledgeling businesses, build educational institutions and promote philanthropy. Consider the case of Avneesh Dahiya. Dahiya owes his three-year journey from Bhojpur, a small village about 187km from New Delhi, to the National Capital Region (NCR), to the commitment of one man to use personal success to help other members of his caste.  Help at hand: Choudhary Chhotu Ram Girls’ Inter College manager Sunil Chowdhry. Pradeep Gaur / Mint Malik, also national president of All India Jat Arakshan Samiti (AIJAS), a caste-based outfit demanding recognition of Jats as Other Backward Castes (OBC) at the national level, met Dahiya in 2007. “What do you do?” he asked Dahiya, who had already spent more than three decades in the village, landless and jobless. With Jats rallying to demand reservations for their community, AIJAS had just been formed, and Malik invited Dahiya to join. In order to help a fellow Jat, Malik also helped Dahiya procure a licence to run the dairy outlet and waived the rent for the shop. The dairy helped Dahiya meet two fond aspirations: to earn a livelihood and send his children to college. Caste continues to puzzle and infuriate many modernizers, but the institution has survived and changed in the six decades after independence even as it continues to whip up passions that can split most political parties down the middle. But away from the heated arguments whether the government should ask citizens details about their caste, the institution itself has shown remarkable resilience and acts as a magnet for identity and philanthropy.  Malik’s focus, for example, is not just Masscon India Pvt. Ltd, the real estate firm of which he is the managing director. As a leader of AIJAS, Malik says he finds his true calling. “The business is important because it helps you make money, but AIJAS is what takes the money where it truly belongs—back to the community.” Malik is a caste leader, of sorts. His caste outfit and business firm collectively serve the community in two ways: while AIJAS helps needy people from his community who approach him, Masscon becomes the employment generator. Since the company was set up in 2000, it has recruited around 40 people from the Jat community as office staff alone. Sociologists view the rise of caste-based organizations as an after-effect of post-Mandal politics in India, the period after 1989 when the Indian government introduced 27% reservation for OBCs in government jobs. “Caste remained unattended before that. Prior to Mandal, there was no reason for individual backward castes to be assertive at the national level. Post-Mandal, caste-based organizations are using caste as an effective instrument of community building and its social and financial upliftment,” Anand Kumar, professor of sociology at the Jawaharlal Nehru University in New Delhi, says. While there are no hard numbers to measure the spread and appeal of such caste organizations, a search on the Internet throws hundreds of names of such outfits with regularly updated websites. While most of them claim extensive membership, many admit that finding issues relevant to the youth of their communities is a big challenge these days. The Chitragupta Kalyan Sangathan, an organization for Kayasthas, who are traditionally known as the caste of the account keepers, in Delhi’s Shahdara, has a helpline for jobs and marriages. The small office tucked away in an old dilapidated building is remarkable because it has no staff, except a peon and a typist to answer the telephone, no photocopier and no conference room. “We do most of the work in the field,” its convenor Santok Saxena says. “We have a large community pool of lawyers, financial planners and bankers. Whenever someone needs us, we offer guidance and relevant contacts.” The Kayastha Mahasabha in Mumbai helps entrepreneurs start their own ventures. “We help them in securing bank loans from our contacts, because it is very difficult for a new entrepreneur to get loans. Sometimes we act as guarantors as well,” says Pramod Srivastava, convenor of the organization. Over the years though, organizations admit much of their appeal has waned. “What we do is very traditional, such as organize mass marriages and religious festivals, which don’t attract the youth of our community. While forward castes are capable of financial means to dispense with, there is lack of unity,” says Praveen Sharma, secretary of the Brahman Samaj Sanstha in Delhi. Sociologist Anand Kumar says unlike the backward caste organizations, associations of forward castes today are on the defensive owing to the rise of OBCs. “They are suffering downward mobility. In the 1950s, they were 70% in elected positions. Now, it is down to 30%. In the changed situation of coalition politics, they are adjusting and have no individual identity,” he points out. At the same time, analysts feel that the caste organizations’ co-option into politics and vice-versa has led to trivialization of the groups’ roles such as their activities remaining limited to distributing medals and organizing dinners to community members. Some of the examples of this co-option, where caste groups made way for political voices, are the Bharatiya Lok Dal, which was led by Jat leader Chaudhary Charan Singh in Uttar Pradesh, and the Rashtriya Janata Dal led by Lalu Prasad in Bihar, which acted as growth engines of caste-based politics in India.  Avneesh Dahiya at his outlet in Ghaziabad.Pradeep Gaur/Mint Ajay Navariya, Dalit writer and assistant professor at Jamia Millia Islamia University in New Delhi says caste organizations got politicized after independence and expected the government to provide for everything. “They have lost sight of more pertinent issues at hand and have become victims of casteist politics,” he adds. About 40km away from Delhi on National Highway 58, Choudhary Chhotu Ram Girls’ Inter College (CCRGC) in Duhai is perhaps a near-perfect example of what may have gone wrong with social work centred around caste and community welfare in the last six decades. Since 1946 when Jat leader Chaudhary Mukhtiar Singh set up the school for girls’ education, the village of Duhai hasn’t seen the establishment of any other institution of higher education by a member of the community. Around the time the college was founded, the western Uttar Pradesh belt, particularly Muzaffarnagar, saw a spurt in schools and colleges set up by Jat businessmen and leaders. Since then, the pace of educational work slowed only to stop completely in the 1980s, say educationists. In his rhetoric on the diminishing role of caste-based organizations in social welfare, Sunil Chowdhary, manager of CCRGC, is quick to lash out at caste-based politics, especially by parties such as the Bahujan Samaj Party and the Rashtriya Janata Dal in north India. “Earlier, caste-based organizations were set up to work for social uplift. After the 1980s, almost each one of them rallied with a political outfit to assert themselves politically,” Chowdhary says. “There was a time when even Jat leaders like Choudhary Charan Singh laid foundation of a degree college by Gujjars. Is it possible today?” Listening intently to the entire debate, Balbir Singh, manager of BR Ambedkar Primary School in Duhai, where he has been providing free education to children of the scheduled castes, differs. “They (caste groups) at least organize our struggle through a forum and raise a collective voice for our causes,” he argues. Inside Chowdhary’s office, dark and humid without electricity, Singh—with his greying hair and tense forehead—is suddenly agitated by the debate. Slowly, the gathering grows to half a dozen people in the room. Someone quotes example of caste groups in Gujarat, which set up orphanages, rest houses, old-age homes and colleges for the community. Kantaben Kamdar Charitable Trust and Jhaverchand Manekchand Trust of the Saurashtra Khadayta caste, or the trader caste, for example, contributes around Rs30,000 every month to support 42 families in the villages of Junagadh in Gujarat. For what little Singh has known, this doesn’t happen in his world. “There are hardly any such groups which work for lower rungs of their communities,” he says. His concerns are not entirely unfounded. The Ambedkar Samaj Sudhar Samiti (or Ambedkar Social Reform Committee), founded by him, often ends up facing resistance from upper caste groups for the work they do: opposing child marriages, untouchability and manual scavenging. Eleven years ago, he, then unmarried, even picked up a girl child from the streets and brought her home after police refused to find a shelter despite his repeated reports. “Well, what would you have done?” he asks. Priyanka P. Narain contributed to this story. Source: LatestNews-Home - Livemint.com | 13 Jun 2010 | 1:45 pm Hunger no moreNew Delhi: 40% of the world’s malnourished children are in India. This is a startling figure for the world’s second fastest growing economy, according to Biraj Patnaik, principal advisor at the Office of the Commissioners of the Supreme Court. It’s also an international embarrassment. India’s social sector statistics do not speak well of a nation that wants to sit on the high table, he says. For example, he sites that the International Food Policy Research Institute (IFPRI) ranked India 66 out of 88 on their global hunger index, lagging behind countries like Rwanda, Pakistan, and Nepal Source: LatestNews-Home - Livemint.com | 13 Jun 2010 | 1:17 pm In Andhra's Nizamabad, all that glitters is turmericTurmeric has reaped gold in Andhra Pradesh's Nizamabad district. Turmeric farmers B Pedolla Chinnaya and Badam Maruthi are celebrating their new prosperity at the local auto dealer. While Mr Chinnaya has plumped for a Hyundai Santro, Mr Maruthi has used his cash bonanza on namesake Maruti Swift.Source: Business Standard | Front Page Headlines | 13 Jun 2010 | 12:42 pm New-look NAC as the new LeftTwo things stood out at the first meeting of the new-look National Advisory Council (NAC) held last week. In their own way, they capture the inherent tension between the Congress party and the Congress-led United Progressive Alliance (UPA) on what should be the government’s development priorities. The delicate balance, or imbalance, between these interests will most certainly dictate the agenda of the UPA in the next four years. First was the signal note of caution by Prime Minister Manmohan Singh, who participated in the proceedings, that the only way to alleviate poverty was to ensure rapid economic growth (which will ensure buoyancy in tax revenue) and the need to ensure fiscal prudence (by limiting expenditure and thereby the fiscal deficit, or gross borrowings) to guarantee that this growth paradigm is preserved. The second was the priority list of NAC: the food security Bill (which tops the list of entitlements), communal violence Bill, tribal development and better implementation of social sector schemes, beginning with an evaluation of the flagship programmes of UPA-I; the latter is a comment on the inability of the government to ensure an adequate delivery mechanism for better targeting of the poor. The elevation of the food security Bill to the top of the agenda is a clear signal that NAC is convinced about entitlements as a development strategy. On the other hand, Singh’s hints at fiscal prudence suggest that there is a need to define the limits on such spending because there is simply not enough money to go around. At the moment the dice is loaded in favour of NAC. The government is on the backfoot, having failed to curb rampant food inflation for the last 18-20 months; and worse, sounding clueless about either its cause or the appropriate policy response. The image deficit of the UPA is apparent, while its political cost is not; at least as yet, since there are no elections due for a while. The party is obviously restless, especially with the government unable to seize the moment when the Opposition is largely disabled. Also Read | Earlier columns by Anil Padmanabhan By focusing on entitlements, or at least ensuring that the discussion about it dominates the airwaves, the Congress party is hoping to turn the tide. (In actual fact, even if all things go well, the food security Bill is unlikely to materialize before the end of next year; this is because it is presaged on the census of people living below the poverty line due to begin next March and conclude in September.) The constituents of NAC—the 15-strong body, including its chairperson, Congress president Sonia Gandhi, is an interesting mix of activists, retired bureaucrats, economists and politicians—are broadly ideologically Left or liberal. It will be the first time that such a group will take charge after the Left formally deserted the UPA following differences over the civilian nuclear deal with the US. Unlike the organized Left, this grouping has eschewed an economic and political agenda and instead sought to focus on the social agenda. Instead of being the vanguard, it has positioned itself as the social conscience of the UPA—which could loosely be defined as the New Left. In its last avatar, NAC had to its credit, among other achievements, the vote-catching theme of the now renamed Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) and the democracy-friendly Right to Information—recent attempts by the UPA to dilute the provisions are likely to be reversed with the return of NAC. Going forward, the focus is clearly on entitlements of the right to food and right to education (which has already been made effective), both of which have the potential to grab the imagination of the masses. According to the government’s latest poverty estimates, the count of poor is around 500 million. The idea of providing the poor fundamental social security is one no one can quarrel about and something that could translate into votes; all the more because there is increasing evidence of growing income inequalities. The problem—Singh alluded to it in his inferences about maintaining fiscal balance—is that the resources to spend without borrowing are limited. The let-up in growth in the last year hit tax revenue. At the same time, its efforts to provide economic stimulus forced the government to increase spending. The widening gap between income and expenditure forced the government to borrow more than ever before. The predicaments of not returning to fiscal prudence in such an uncertain global economic environment can be disastrous. The outcome is difficult to predict and will depend entirely on Gandhi. At the least, the makeover of UPA-II has begun. Anil Padmanabhan is a deputy managing editor of Mint and writes every week on the intersection of politics and economics. Comments are welcome at capitalcalculus@livemint.com Source: LatestNews-Home - Livemint.com | 13 Jun 2010 | 12:40 pm Mukesh plans $5-bn telecom revolution 2.0RIL, RCom working on partnership blueprint.Source: Business Standard | Front Page Headlines | 13 Jun 2010 | 12:39 pm Hindustan Unilever’s buy-back achieves multiple purposesThe decision by Hindustan Unilever Ltd (HUL) to buy back shares may appear mysterious. The consumer products company is faced with rising competition in the Indian market and is fighting a battle to regain market share and volume growth in a few key categories. While that may seem an occasion to conserve money, what gives HUL confidence is the mountain of cash it generates. In fiscal 2010, HUL’s cash generated from operations was Rs3,420 crore, compared with Rs2,025 crore in the previous year (15-month accounting period). A large part of this is due to better working capital management. Its balance sheet as of March 2010 had around Rs1,900 crore in cash and around Rs1,260 crore in investments, a large proportion of which will be liquid. It will be cash-rich, even after paying dividends of Rs1,656 crore (including tax).  Photograph by Prashanth Vishwanathan / Bloomberg; graphic by Naveen Kumar Saini / Mint How will the buy-back help HUL? A stronger balance sheet can become a problem too, as the excess capital earns lower returns than the core business. That is, if the business earns a return of say 15%, capital deployed in safe fixed income instruments may not earn more than 6-7%. That depresses the overall returns as a result. By returning this cash, HUL can lower its balance sheet size by a bit. In addition, its equity capital will fall by around 1% and its earnings per share will increase, providing a buffer against lower profit growth. The buy-back will also shore up Unilever Plc’s shareholding in the company. HUL had outstanding stock options of 4.76 million as of March 2009. Between then and March 2010, HUL’s equity capital increased by 1.8 million shares and Unilever’s stake has come down by 2 basis points. If more options are exercised (likely as they are making a profit at current prices), then Unilever’s stake may fall further. One basis point is one-hundredth of a percentage point. Assuming the buy-back is done at Rs250, Unilever’s stake will go up to a comfortable 53.2%. Source: Home - Livemint.com | 13 Jun 2010 | 12:29 pm Feud with ally mars BJP’s show of powerNew Delhi: Public snubbing by some senior leaders and a row with a crucial regional ally marred the Bharatiya Janata Party’s (BJP) two-day national executive meeting in Patna, which concluded on Sunday. Analysts said India’s main opposition party—which has lost two successive national elections to the Congress party—has emerged weaker still from a meeting that was meant to have been its show of strength. Former Union minister Yashwant Sinha, former Rajasthan chief minister Vasundhara Raje and actors-turned-politicians Shatrughan Sinha and Hema Malini stayed away from the gathering at the Bihar capital. The four are unhappy about the allocation of Rajya Sabha seats from the party, officials said on condition of anonymity. “I am concerned by the way the party is being run. Why are senior leaders like Yashwant Sinha, (former Uttarakhand chief minister) B.C. Khanduri and (former Union minister) Arun Shourie being cornered?” Shatrughan Sinha, a member of Parliament from Patna, said on Saturday. The BJP is part of the ruling coalition in Bihar, led by Janata Dal-United’s, or JD(U), Nitish Kumar. Sunday’s proceedings were overshadowed by the chief minister ordering a probe into an advertisement that showed him alongside BJP’s Gujarat chief minister Narendra Modi. Kumar also called off a dinner with the BJP brass on Saturday over this issue. Modi has been accused of abetting anti-Muslim riots in Gujarat in 2002, while Kumar will require the support of Muslims to retain power when Bihar votes in assembly elections later this year. The police raided the offices of the advertising agency that brought out the ad in regional dailies. The BJP has distanced itself from the ad. But reacting to Kumar’s action, BJP spokesperson Rajiv Pratap Rudy, who also hails from Bihar, said the JD(U) should understand that the BJP “would not compromise on self-respect”. An analyst said the feud will hurt the BJP, although it wasn’t serious enough for the alliance partners to snap ties over. “Both parties seem to be testing the waters before entering the heat of the polls and arriving at the seat-sharing formula,” said Vivek Kumar, associate professor, Centre for the Study of Social Systems at Jawaharlal Nehru University, New Delhi. “But the standoff and the two-day conclave have further weakened the BJP’s position, exposing its inbuilt paradoxes and strained relationships with its allies,” he added. The controversy has established that the BJP, to some extent, remains an untouchable party, Vivek Kumar said, referring to the difficulties the supposedly “anti-Muslim” party has historically faced in tying up with India’s “secular” parties, who depend on Muslim votes for survival. But JD(U) president Sharad Yadav said the “relationship is quite old... an unpleasant incident took place yesterday (Saturday). It has passed.” The BJP meet ended with a rally to mark the launch of the party’s assembly election campaign. Veteran leader L.K. Advani, who has himself been at odds with the BJP’s emerging leadership over the past year, stressed the need for “greater discipline” while addressing the rally. The BJP also issued a resolution condemning the Congress-led Union government for “a vicious and vindictive campaign against our state governments”. santosh.j@livemint.com PTI contributed to this story. Source: LatestNews-Home - Livemint.com | 13 Jun 2010 | 12:15 pm RIL to infuse additional $1 bn in Infotel for broadband networkMumbai: Infotel Broadband Services Pvt. Ltd, the vehicle that will spearhead billionaire Mukesh Ambani’s re-entry into the telecom sector, will become operational in the next two years with an additional investment of $1 billion and a target of 100 million subscribers in five years. In a meeting with analysts late Saturday, Ambani’s close associate Manoj Modi and Reliance Industries Ltd (RIL) chief financial controller Alok Agarwal gave analysts an outline of the business they acquired the previous day for Rs4,800 crore (around $1 billion), on top of the Rs12,848 crore ($3 billion) that Infotel spent for a pan-India licence to roll out broadband across India. Modi and Agarwal discussed the company’s plans with 30 analysts in a two-hour presentation made in the boardroom on the 10th floor of Maker Tower E in Mumbai’s Cuffe Parade area. The executives said in the course of the presentation that the company plans to invest an additional $1 billion in rolling out a broadband network and will aim for 100 million customers—around one-sixth of India’s current wireless subscriber population—within five years of launch, according to analysts who attended the meeting and requested anonymity. That will take RIL’s total investment in the broadband business to at least $5 billion.  Graphic: Ahmed Raza Khan / Mint The purchase, which will turn Infotel into a subsidiary of RIL, marks the re-entry of Mukesh Ambani into the telecom sector that he exited five years ago in favour of his younger brother Anil Ambani, who went on to keep control of Reliance Communications Ltd, now India’s second largest mobile phone company by subscribers. This is Mukesh Ambani’s first investment in a sector where his brother is present, following the scrapping of a non-compete agreement in the last week of May. Brothers in the know RIL’s decision to enter the telecom market for the second time may have surprised the media and analysts, but the two brothers knew about it when the non-compete agreement was torn up, according to a group executive familiar with the development. “Both camps knew about the plan at the time of dissolution of the pact,” said the executive. Bhagwan Das Khurana, a telecom technocrat who worked with the older Ambani and later with his younger brother, isn’t surprised by RIL’s return to the telecom sector. “Whenever we (Mukesh Ambani and Khurana) met at social occasions, the talk veered to what is happening in the telecom sector,” he said. Khurana, who is currently in Nairobi, on Friday said the latest venture would be more challenging, as Mukesh Ambani would have to depend on the infrastructure of other telecom companies, unlike his earlier telecom venture when he rolled out the entire network of fibre network and telecom tower stations. RIL would need 15,000-20,000 telecom towers and erecting towers was not as expensive as made out to be, Modi told an analyst. To another query on whether RIL would be willing to share the infrastructure owned by Reliance Communications, Modi said: “We’ll work with whoever is willing to work with us.” People familiar with developments at RIL said these are early days yet. “We have to select a technology, build a team and prepare a business plan,” said a person involved in the roll-out in 2002 of Ambani’s Reliance Infocomm, now Reliance Communications, who still remains an executive in the Mukesh Ambani group. RIL launched Infocomm’s network in late 2002, billing it as the world’s “largest and most complex roll-out in the history of the IT (information technology) and communication sector.” A public spat between Mukesh and Anil Ambani over “ownership issues” then led to the carving up of the Reliance business empire, with the younger Ambani taking control of the telecom firm just a year-and-a-half after it was born. Passion for telecom It would have been galling for the older brother, whose dream of providing data, video and value-added services to telecom users in the world’s fastest growing wireless market seemed to have crashed overnight. Reliance Communications went on to build a subscriber base of 100 million. Still, spectrum shortage meant that the country’s large number of cellphone users could not access high-speed data services such as video streaming. “Telecom is his passion, and Mukesh excels in project execution, scale and speed,” Khurana said in an earlier interview. The elder Ambani used to often talk about the “triple play” of offering voice, video and data services when the brothers divided the business empire founded by their late father Dhirubhai Ambani. “This (broadband) to our chairman is the unfinished agenda,” said the group executive quoted earlier. Now, the company is trying to leapfrog the 3G (third-generation) revolution before it even begins. Mukesh Ambani’s bet on 4G services aims to offer speeds as much as five times faster than 3G networks. Almost all network operators say that data services such as broadband access is the road ahead for carriers to boost revenue. “It would be very interesting how this market opens out. There is room for everyone,” said Hemant Joshi, telecom head with Deloitte Touche Tohmatsu India. Telecom slug-fest RIL will find India a changed telecom market since its last venture in the sector. In 2004, there were six telecom service providers nationally with a handful of local entities competing for subscribers. Now, the telecom market is witnessing a slugfest between more than a dozen competitors caught in a price war that’s leading to profit erosion at most service providers. Back then, network operators were trying to get more people to buy a cellphone. Now, the number of cellphones has more than doubled to 600 million and the country continues to add 17 million users every month. “When we first entered, we were fighting to create a market. Industry is maturing now,” said the person cited above, who was involved in the roll-out of Reliance Infocomm. “The total (number of) wireless subscribers when Reliance Infocomm was formed was less than 10 million subscribers. All that changed as tariffs came down. Something similar could happen now, as RIL scales up.” RIL indicated on Friday that it would use Qualcomm Inc.’s LTE, or Long Term Evolution, technology for wireless broadband services rather than the rival WiMax standard. If the company does so, it would mark an important victory for US-based Qualcomm, which won spectrum in two cities—Mumbai and Delhi—in the auction of spectrum for mobile broadband services that closed last week. The company is rolling out an LTE-based network, a 4G technology that allows users to access data at speeds of 1 Gbps (gigabit per second). RIL could find that it had dialled the wrong number if other operators roll out planned 3G networks sooner than Mukesh Ambani does the 4G network on which he is betting. There are other aspects, too, that have some analysts worried. The speed and scale at which Mukesh Ambani executes projects at times exposes the company to risks. For instance, when the whole industry wooed pre-paid subscribers, Mukesh Ambani chased post-paid customers and paid the price as cheques bounced and the billing system failed to cope. “When you move with speed, there would be mistakes, but we are also capable of making quick course corrections with speed,” an RIL official said on condition of anonymity. “With the experience we have in telecom, we’ll not repeat some of the mistakes we made earlier and some made by our peers,” the same official added. “We’ll actually have no legacy (issues) as we’ll approach the business with a clean slate.” varun.s@livemint.com Source: Home - Livemint.com | 13 Jun 2010 | 11:56 am Quick Edit | Pictures imperfectA cliche has it that a picture is worth a thousand words. In contemporary India, innocuous photographs often create political fear. Late last week, a picture caused a political furore in Patna. Pictures of Bihar and Gujarat chief ministers Nitish Kumar and Narendra Modi were splashed in a newspaper advertisement, something that Kumar found unpalatable. With state assembly elections close at hand, he feared the erosion of a vote bank. In Gujarat, a different picture turned out to be unappeasing. In this case, an advertisement used a picture of Muslim girls working on a computer in a college in Uttar Pradesh to highlight the achievements of the state government. In both cases, political leaders had outdated ideas about the political uses of photographs. Indian voters don’t use visual information alone to make choices. There’s more at stake for them than mere pictures. Source: LatestNews-Home - Livemint.com | 13 Jun 2010 | 11:54 am Reliance Infratel may sell stake firstMumbai: The Anil Ambani group may sell a stake in the debt-laden telecom towers business of Reliance Communications Ltd (RCom), seeking to improve the valuation of its flagship firm, said a person familiar with the plan. The sale of a stake in Reliance Infratel Ltd, as the towers business is known, would precede the proposed divestment of as much as 26% of RCom to strategic or private equity investors, said the person, who didn’t want to be named. An RCom spokesperson declined to comment. RCom’s board on 6 June approved the stake sale in India’s second biggest mobile phone company by subscribers, giving it the freedom to raise funds for expansion and seek consolidation opportunities. The stake sale in the towers business would help RCom reduce some of the Rs33,000 crore of debt on its books, almost half of which can be traced back to Reliance Infratel. This would help RCom realize a better valuation for the stake it sells potential investors. According to a draft red herring prospectus filed by Reliance Infratel in September, the company has total debt of at least Rs15,000 crore. RCom holds a 95% stake in Infratel. Media reports over the past few days have suggested that RCom could be in talks with international telecom firms such as the Abu Dhabi-based Emirates Telecommunications Corp., known as Etisalat, South Africa’s MTN Group Ltd and AT&T Inc. of the US for a possible stake sale. Reliance Infratel had planned an initial public offering (IPO) of shares as long ago as in February 2008, but the public issue is yet to hit the market. “Reliance Infratel has been deferring its IPO for quite sometime now, and bringing in a strategic investor could be one route for the company to secure funds for capital expenditure. Also, with declining revenue per user, it could become difficult for RCom to service the debt on its books,” said Rahul Jain, a telecom sector analyst at Angel Broking Ltd. To be sure, not all analysts subscribe to the view that RCom necessarily has to deleverage Infratel’s books to command a premium for its stake. “What really matters is the investor’s faith in the long- term business in case of a company like Reliance Communications,” said a research analyst with a Mumbai-based brokerage who did not want to be named as he is not authorized to speak to the media. “Moreover, the fresh capital that a strategic investor would bring will deleverage RCom, as it does not require significant investment in infrastructure in the near term, given the low levels of utilization at present,” the analyst said. In a presentation made to investors in May, RCom said Infratel was estimated to have around 54,000 towers across the country as of 31 March. India’s telecom tower market has seen two transactions in the last five months. GTL Infrastructure Ltd bought Aircel Ltd’s 17,500 towers for Rs48 lakh apiece and Quippo Infrastructure Ltd purchased Tata Teleservices (Maharashtra) Ltd’s 2,500 towers for Rs52 lakh apiece. A rough calculation, assuming Rs48 lakh per tower as the price, puts Reliance Infratel’s asset value in the region of Rs25,000 crore. Reliance Communications’ market capitalization, at its closing share price of Rs. 172.55 on Friday, is Rs 35,625 crore. Besides Reliance Infratel, GTL and Quippo, other major telecom tower operators in India are Bharti Infratel Ltd and Indus Towers Ltd. GTL owns 32,000 towers and wants to raise this number to about 50,000 in the next three years. Quippo has around 38,000 towers in India. Bharti Infratel, Bharti Airtel Ltd’s tower arm, has around 30,000 towers. Indus Towers has at least 100,000 towers and its shareholders are Bharti Airtel and Vodafone Essar Ltd, both of which hold a 42% stake each, and Aditya Birla Telecom Ltd, which owns the remaining 16%. Reliance Infratel has tower sharing agreements with at least five telecom operators already offering mobile telephony services in India or are set to do so shortly. These firms include Etisalat, Aircel and Tata Indicom. Reliance Infratel—which also houses RCom’s optical fibre cable network—would be especially lucrative for companies that have won broadband wireless spectrum in the recently concluded government auction, once they decide to roll out their services. Infotel Broadband Services, which has been recently acquired by Anil Ambani’s older brother Mukesh Ambani’s Reliance Industries Ltd and the only company to win pan-India broadband wireless access, would be one such company. CALCULATIVE MOVE THE NEWS Reliance Infratel, the tower subsidiary of Reliance Communications, might look to sell a strategic stake to investors, before it scouts for potential investors for a 26% stake in RCom. THE BACKGROUND With the non-compete agreement between the Ambani brothers out of the way, RCom, the telecom services arm of the Anil Ambani Group, is free to sell equity in the company. On the other hand, Infratel’s IPO, planned way back in February 2008, is yet to hit the market. THE IMPLICATION The move would help RCom offset some of the debt that rests on its books and help it realize a better valuation for the stake. aveek.d@livemint.com Source: LatestNews-Home - Livemint.com | 13 Jun 2010 | 11:53 am Lifestyle brands find unlikely endorsersWe’re used to seeing film starts and sports personalities endorsing brands. But fashion photographers and designers are surely a new idea.Source: HindustanTimes.com - Top Business News Headlines | 13 Jun 2010 | 11:44 am What RBI needs to tackle now?Industrial output in April grew 17.6% over the corresponding period last year, beating analysts’ estimates by a wide margin and coming close to the 20-year high of 17.7%, recorded in December 2009. The Indian economy is clearly performing above potential and there is a strong case for the Reserve Bank of India (RBI) to raise interest rates. Incidentally, the policy rate in the country has already gone up. I am not joking. It has gone up this month by 1.5 percentage points, from 3.75% to 5.25%. How has this happened? Well, the Indian central bank has two policy rates—the repo rate, or the rate at which it injects liquidity into the financial system, and the reverse repo rate, or the rate at which it sucks out excess liquidity from the system. This means that in a liquidity-surplus situation, which had been the case since October 2008, when RBI started flooding the market with money to tackle the credit crunch in the wake of the collapse of US investment bank Lehman Brothers Holdings Inc., the reverse repo rate is the policy rate. But when liquidity becomes tight, which is the case now, the repo rate replaces the reverse repo rate as the policy rate. The repo rate at present is 5.25%. On 7 June, the banking system borrowed Rs62,325 crore from RBI. The amount rose to Rs68,055 crore the next day. On average, the system drew around Rs60,000 crore every day from the central bank last week to tackle a sudden liquidity crunch. In contrast, in May, the banks were on average parking close to Rs33,000 crore daily at RBI’s reverse repo window. Even the normally liquidity-flush State Bank of India, the country’s largest lender, was seen borrowing from RBI’s repo window last week. Also Read | Earlier columns by Tamal Bandyopadhyay The policy rate has gone up and liquidity is tight, but there has not been any impact on different segments of the financial market yet. For instance, the yield on benchmark 10-year government paper continues to be around 7.6% and the overnight call money rate has not risen beyond 5.25%, the repo rate. Ideally, the price of overnight money should be between the reverse repo rate and the repo rate, but it can go beyond the upper end of the corridor if banks do not have excess bonds to give to RBI as collateral for borrowing money. Under current norms, banks are required to invest 25% of their deposits in government bonds, known as the statutory liquidity ratio, or SLR, but most banks hold more. When many banks do not have bonds in excess of 25% and, hence, cannot raise money from RBI’s repo window, they crowd the overnight market and the cost of overnight money soars. This is unlikely to happen now as the average SLR holdings of banks is around 27-28% but liquidity is set to tighten further. Last week, the Indian government raised Rs38,543.31 crore from the auction of broadband wireless access, or BWA, spectrum. In May, nine successful bidders for 3G spectrum had to pay Rs67,719 crore to the government for the 22 telecom circle licences on offer. Banks’ share in both BWA and 3G spectrum payouts is substantial. On top of that, there will be an outflow of Rs35,000-40,000 crore from the banking system on account of advance tax payments this month. Indian companies pay advance tax on their projected profits every quarter. The biggest challenge for RBI this month will be managing the government’s borrowing programme. The gross annual borrowing programme of the India government rose from Rs2.51 trillion in fiscal 2009 to Rs4.51 trillion in 2010 to bridge the widening fiscal deficit, but RBI did not have much of a problem in managing it as there was plenty of liquidity in the system, with not too many takers for bank credit. In 2011, the borrowing programme has risen further to Rs4.57 trillion and RBI plans to raise 63% of this in the first six months of the current fiscal. But with the sudden tightness in liquidity, the banking system may not have enough money to buy government bonds. To complicate the situation further, the deposit mobilization in the system has been tardy this year. In the first two months, banks have raised Rs69,626 crore of deposits, almost half of what they raised in the first two months of last fiscal. The year-on-year deposit growth till May-end was 14.9%, down from 22.1% in the previous year. In absolute term, deposit accretion has been Rs5.93 trillion in the past year till May, down from Rs7.18 trillion. The growth in bank credit, on the other hand, has been higher—Rs4.98 trillion, or 18.1%, in the past year against Rs3.74 trillion, or 15.8%. In the first two months of the current fiscal, credit offtake was still negative but only marginally, Rs1,013 crore. In the corresponding period last year, the system had seen a decline of Rs29,572 crore, or 1.1%, in the banking industry’s credit portfolio. RBI has already indicated that it would borrow Rs22,000 crore less than what it had planned in June by postponing short-term treasury bill auctions, but there has not been any change so far in its plan to sell medium- and long-term bonds. If the liquidity situation worsens, it will have to go slow in its money-raising plan for the government. Whether the money raised through sale of 3G and BWA spectrum will help the government lower the fiscal deficit is a different story. It will depend on whether the government will implement the recommendations of the Kirit Parikh panel, decontrol petrol and diesel prices and stop subsidizing them. Tamal Bandyopadhyay keeps a close eye on all things banking from his perch as Mint’s deputy managing editor in Mumbai. Your comments are welcome at bankerstrust@livemint.com Source: LatestNews-Home - Livemint.com | 13 Jun 2010 | 10:44 am
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