Tracking Different Sectors of the Indian Economy: Air India – Indian airlines merger

• Government Policy & Infrastructure
• Fashion
• Manpower & HR
• Real Estate
• Tier II Cities
• Sector Specifics
• Agriculture
• Lifestyle Trends

Government Policy & Infrastructure

Air India – Indian airlines merger

Clearing the last hurdle, the cabinet passed the Air India and Indian merger reports CNBC-TV18. The government will continue to be the sole owner of the merged entity. It will look for IPOs after approval of a committee consisting of the finance ministry.The government has not announced what the name of the merged entity will be, but sources say it might be called Air Indian since the Indian brand does not have much equity.

Friday, March 2, 2007
Source: Moneycontrol.com

Steel price hike

On a day when the Finance Minister, Mr P. Chidambaram, asked industry to hold the price line, domestic steel and cement manufacturers went the other way and announced price hikes in the two products. On Thursday, primary steel manufacturers raised hot-rolled steel prices across the board, the increase ranging from Rs 700 to Rs 1,200 per tonne. Cement manufacturers have increased prices by Rs 12 per 50 kg a bag. The average price of hot-rolled coils, which has been Rs 27,500 per tonne till Wednesday, has gone up to Rs 28,500 per tonne from Thursday. Adding a 16 per cent excise duty and four per cent sales tax, the price that the consumer will have to pay has gone up from Rs 33,176 per tonne to Rs 34,382 per tonne (assuming an average increase of Rs 1,000 per tonne).
Thursday, March 1, 2007
Source: Hindu business line

India`s export share touches 1%

India's share in world merchandise exports has crossed the 1 per cent mark and continues to stay at that level. It touched 1 per cent of global exports in 2005, and in January-August 2006, the share continues to be above 1 per cent. The latest Economic Survey shows that this share had been stagnating for the past few years and stood at 0.7 per cent in 2001. It stabilised at 0.8 per cent between 2003 and 2004. The country could increase its share of global merchandise exports as domestic exports grew by more than double the rate of growth in world exports since 2005. External factors like improved global growth and recovery in global trade aided the growth. The government has set a target of achieving 1.5 per cent of total world exports by 2009.
Monday, March 5, 2007
Source: Business Standard

Steel, cement companies hike prices

Within 24 hours after the Government announced a series of duty concessions on steel-making inputs, to keep prices stable and despite the FM's exhortations to the industry to hold the price line, domestic steel and cement manufacturers have announced price hikes in the two products. Primary steel manufacturers raised hot-rolled steel prices across the board, the increase ranging from Rs700 to Rs1,200 per tonne. Cement manufacturers too increased prices by Rs12 per 50 kg a bag. The average price of hot-rolled coils has gone up to Rs28,500 per tonne. Adding a 16 per cent excise duty and four per cent sales tax, the price that the consumer will have to pay has gone up from Rs33,176 per tonne to Rs34,382 per tonne (assuming an average increase of Rs1,000 per tonne).
Friday, March 2, 2007
Source: www.domain-b.com

States put pressure on Centre for resolving SEZ issue

Many Chief Ministers have started putting pressure on the Centre to resolve the SEZ impasse as global investors have conveyed concern over their investments in India. The Chief Minister of Tamil Nadu, Gujarat, Andhra Pradesh, Karnataka, Haryana have written to the members of the empowered Group of Ministers on SEZ conveying concerns of the investors who had lined up big investments in their states.
According to sources, Taiwan-based Lotus Footwear, which had obtained final approval for their SEZ in Thiruvannamalai in Tamil Nadu, has written to the Commerce Ministry that they are concerned over the future of their investment plans in India.

"The present unstable situation in India on SEZs is worrying us and our buyers...., " Lotus, which is a contract manufacturer for world's top footwear brands, said. It has already ordered for machinery.

The Chief Ministers have written to the eGoM members asking them to allow notification of SEZs who have got final approval from Board of Approvals and already have land.

In many cases, the Chief Ministers, have also said that in many cases land, which had been with the state industrial development corporations for many years, has been given to the SEZ developers.

As many as 172 proposals that have got final approval are waiting for notification. Among the 166 SEZ proposals that have got in-principle approval, 100 have already tied up land.

Sources said in cases where land has already been acquired can be allowed to be notified, as the much awaited Rehabilitation Policy would not apply to them.
Thursday, March 1, 2007
Source: PTI

11 SEZs sanctioned in Kerala

A total of 11 Special Economic Zones (SEZs) had been sanctioned in Kerala, Chief Minister V S Achuthanandan informed the state assembly today.  Most of these, sanctioned under the SEZs Act 2005, are promoted by public sector facilitators like Kinfra, Technopark and Cochin Port Trust, he said in a reply furnished in the house.

They would enjoy concessions like exemption in civic taxes and electricity tax prescribed by the SEZs Act. Besides, the state would provide them with basic requirements like electricity and water.

All the labour laws under Industrial Disputes Act were also applicable in the SEZs, but their enforcement would be entrusted to a Development Commissioner in each SEZ.

The SEZs for which sanction had been given ainclude:Cochin Port Trust, Vallarpadom (multiproducts), Kinfra, Kakkancherry (food processing), Kinfra, Kazhakkoottam (IT), Technopark, Thiruvananthapuram (IT), Smartcity, Kochi(IT), Sutherland Global Services, Kalamassery (IT),Kinfra, Kochi (electronics) and Unitech Realestate, Kunnathunadu (IT).
Monday, March 5, 2007
Source:PTI

Govt may lift freeze on ‘all-clear’ SEZs

The government may soon end the freeze on special economic zones (SEZs) for developers who have land in possession, have secured formal approval for their projects and have completed all formalities required for notification.

The empowered group of ministers (eGoM) on SEZs, which is tentatively scheduled to meet next week, may allow such zones (about 60 in number) to be notified. These include a textile SEZ by Sri Lankan Brandix, a pharma SEZ by Medilabs, a footwear SEZ by Taiwanese footwear company Lotus and an IT SEZ by Infosys.

Other SEZ proposals where the land has been acquired by developers may also be favourably considered. There are about 173 SEZs, in addition to the 63 SEZs which have been notified by the government, where developers have land in their possession.

The fate of other proposed SEZs, including the ones which have received in-principal approvals, will subsequently be decided after the eGoM takes a call on the changes to be made in the SEZ policy based on concerns expressed by various political parties and farmer groups.

The eGoM on SEZs had put a freeze on all approvals and notifications of SEZs on January 22, following apprehensions expressed by many on forcible land acquisition by states, inadequate rehabilitation package and land misuse. The protests in Nandigram, West Bengal, where the Indonesian Salim group was planning to set up a chemicals SEZ, had taken a violent turn.

The uncertainty caused by the freeze resulted in complaints flowing in from companies who had already invested in machinery and manpower after receiving formal approvals for their proposals. A number of states including Andhra Pradesh, Gujarat, Karnataka, Haryana and Tamil Nadu also wrote to the PMO and eGoM chairman Pranab Mukherjee asking for an end to the status-quo.

Speaking to ET, official sources said that the commerce department had pointed out to the eGoM that there was no logic behind stalling clearance of SEZ projects which were not just in possession of land but had also cleared all formalities required for notification. These include obtaining certificates from the state government on land possession and non-encumbrance, getting clearance from the development commissioner and a clearance certificate from the revenue department.

“It seems that the eGoM has finally seen our point and will take a favourable decision in a meeting tentatively scheduled next week. We are also making a case for all SEZs which have land in possession and have received a formal clearance from the government,” an official said.

Sources added the eGoM was waiting for the rural development ministry’s new rehabilitation package for oustees to get Cabinet clearance before taking a decision on the changes to be brought about in the SEZ policy. The changes being considered include placing caps on the number of SEZs and a ceiling on the size of multi-product SEZs.

Tuesday, March 6, 2007
Source: TNN through Economic Times

Steel makers to reverse price increase – govt

Steel makers have agreed to reverse a 300-700 rupees per tonne increase in the price of reinforced steel from Monday, the government said, after an appeal by the authorities to help fight inflation. Prices of reinforced steel, which is used for construction of houses, were raised last Thursday to bring them closer to world prices. But government officials concerned about inflation that is running at near two-year highs held talks with producers including Steel Authority of India Ltd. and Tata Steel Ltd., the top two steel makers. Producers have also agreed to cut prices of hot rolled coils, used for making tubes, by 500 rupees a tonne, the government said. At least two steel makers, Essar Steel and Tata Steel, had raised the price of hot rolled coils by 1,000 rupees per tonne on March 1 in line with international prices.
Monday, March 5, 2007
Source: Reuters

FM tells corporates to pay excise duty

Finance Minister P Chidambaram on Wednesday expressed concern about the "sizable" evasion of excise duties and asked corporates to pay their tax liabilities under this head on the lines of service and corporate income taxes.

"I am inclined to believe that there is sizable evasion in excise duty. I would urge corporates to pay excise duty just as they are paying corporate income and service taxes. Evading duties do not pay in the long run. One black mark will haunt you throughout the year," Chidambaram said after launching electronic payment system for excise duty and service tax.

He expressed wonder as to why excise duty is not keeping pace with growth in the manufacturing sector. "When the economy is growing at 8.5-9 per cent and manufacturing by double digit, excise collections should also grow at the same rate," he said.

The Finance Ministry revised down its target of excise duty collections to Rs 1,17,266 crore for this fiscal against the earlier estimate of Rs 1,19,000 crore.

While there has been steep rise in corporate income tax and service tax collections, there has not been commensurate increase in excise duty collections, Chidambaram said. Greater focus would be laid on collecting excise duty during 2007-08, the Finance Minister said.

In December, Excise Department had announced to withdraw or restrict certain facilities, like registration of dealers, from those not paying excise duties to the Government.

Pointing to these measures and electronic payment system launched on Wednesday, the Finance Minister said both hard and soft steps have been put in place to increase the excise kitty. Source: PTI through Economic Times, 7th Mar;07 Real-estate major Unitech and promoters of India's first amusement park Appu Ghar, International Amusement Ltd, are jointly setting up two entertainment parks in Noida and Rohini with an investment of about Rs 1,600 crore.

The joint venture company to be called International Recreation Parks Pvt Ltd (IRPPL), has tied up with global media conglomerate Turner Inc's children entertainment channels Cartoon Network and Pogo to provide a specific themes to the amusement parks.

"We would invest Rs 1,200 crore on the Noida project and around Rs 400 crore on the Rohini project to build state-of the art amusement parks in Delhi and its neighbourhood. We are running the Rohini park on a trial basis while the Noida project is expected to be operational by mid of this year," IRPPL Managing Director Rakesh Babbar told media.

He said the park would feature over 30 different rides and attractions, which will be supplied by leading European manufacturers including Zamperla of Italy who also supply rides to Disney, Universal Studios and Six Flags.

The projects would be funded through a mix of resources including debt, equity and internal accruals," Babbar said.

Noida park, which would have a built area of 150 acres, would be divided into two zones -- amusement park and commercial -- with 85 per cent of the site dedicated to the amusement park and the remaining 15 per cent for commercial purposes.

The first phase of operations in Noida, expected to be complete at an investment of Rs 600 crore in July, would include a Teen Zone and a lifestyle centre. The second phase will include the opening of rest of the amusement park and a premium brand retail section- Garden's Galleria.

Wednesday, March 7, 2007
Source: PTI through Economic Times

CCEA okays integrated zones for petroleum, chemicals

The Cabinet Committee on Economic Affairs (CCEA) today approved the setting up of large-scale integrated zones for petroleum, chemicals and petrochemicals complexes (PCPIRs). The policy spells out the objectives, concept of PCPIRs, role of Central and State Governments, institutional framework, procedures, role of developers/co-developers, units in PCPIRs, dispute resolution etc, the Finance Minister, Mr P. Chidambaram, told presspersons after the meeting. It has been decided that not more than five such complexes would be set up.

Thursday, March 8, 2007
Source: thehindubusinessonline.com

‘Indian cos currently don’t need to tap mezzanine route’

Indian corporates have barely scratched the surface for mezzanine financing — a route which some of them are considering to fund their big-ticket acquisitions. Also, overseas investors feel that the bigger Indian corporates have still a lot of room for leveraging their balance sheets to fund growth.

According to A Michael Rees, CEO wholesale bank and director, Standard Chartered Bank, “Indian companies are under-leveraged and have adequate capacity to raise debt finance. They currently do not need to tap the mezzanine route. Over a period of time, they could look at this route also.”With Indian corporates eyeing large-ticket acquisitions, there have been talks about some corporates looking at funding part of their acquisitions financing through mezzanine funding.

Under mezzanine financing, corporates would have to shell out nearly 400-500 basis points (bps) over the London Inter-bank Offer Rate (Libor), while junk bonds, yet another method of financing, would cost around 8-9% above the Libor. While the pricing of mezzanine issuances depends on the structure, the latter depends on the rating held by the issuer. An “AAA-rated”corporate would be able to raise finances at around 45-60 bps above Libor. Indian corporates as of now have barely raised any funding through mezzanine financing, Mr Rees added.

According to him, overseas investors so far have had been underweight on India, but with the sovereign rating being upgraded, there is likely to be renewed interest in Indian issuances. Banks from Taiwan, Korea and Macau have subscribing to papers issued by Indian players.

India and Greater China are among the fastest growing markets under wholesale banking for StanChart. India is also the second largest growing market under wholesale banking. StanChart had helped Indian corporates raise $9.1 billion of debt in calendar year 2006 against $5.3 billion in 2005.

International banks like StanChart have been using their bigger balance sheets to help finance Indian corporates overseas acquisitions and financing. StanChart had raised up to $11 billion worth of debt for the Tata group even prior to the Corus deal. In case of Essar’s bid for Hutchison, StanChart had committed $3 billion.

With the growing needs of financing from corporates StanChart is also looking at removing country limits. “Having country limits is irrelevant when the Indian economy and local corporates are showing signs of such robust growth. These limits serve the purpose of a control mechanism when there are concerns on the growth of a particular market where we are present,” said Mr Rees.

He, however, had a word of caution for Indian corporates. According to him, there is a huge pool of liquidity available. However the part of the problem is pricing and the type of covenants around the debt deals. It is upon the players structuring such deals to protect domestic companies from entering into such wrong structures, as weaker governance practices may hamper investors’ interests in the longer run.

Mr Rees also pointed that merely looking for tax arbitrage and balance sheet management while structuring fund-raising deals is not feasible. Banks are looking at structuring deals through countries like Singapore and Mauritius which have signed double taxation treaties with India.

Friday, March 9, 2007
Source: TNN through Economic Times

PCPIR policy gets nod

After a long wait, the policy on petroleum, chemicals and petrochemicals investment regions (PCPIRs) is finally here. The Cabinet Committee of Economic Affairs(CCEA)on Thursday gave its approval to the policy that aims to promote investment in petroleum, chemicals and petrochemicals by creating investment regions with suitable infrastructure.

“The policy aims at making the country an important hub for both domestic and international markets,” finance minister P Chidambaram said after the CCEA meeting. He added that such regions would boost manufacturing, augment exports and generate employment. No more than five PCPIRs will be set up under the policy. “Further details of the policy will be disclosed by the chemicals and petrochemicals ministry,” Mr Chidambaram said.

The CCEA also considered the much-awaited national policy on biofuels and creation of the National Biofuel Development Board but did not finalise any decision. Both proposals have been referred to a group of ministers for further examination.

Friday, March 9, 2007
Source: TNN through Economic Times

Cement cos agree not to hike prices for 1 yr: Kamal Nath

Commerce Minister Kamal Nath says that cement companies have agreed not to hike prices for a year despite higher input costs. He also adds that cement companies will pass benefits to users in case of sops. However, cement companies have said that they would cut prices only if excise duty is lowered.

"The cement producers have agreed to hold the price line and not increase the prices any further in the next one year even if the costs of inputs increase," Kamal Nath said.

The peace formula emerged at the a two-hour meeting that the Minister and Department of Industrial Policy and Promotion, or DIPP officials held with the cement manufacturers. It, however, does not address the government's demand from the cement manufacturers to bring down prices from current levels. The companies, however, refused to roll back the recent hike which has been done because of increase in excise on 50-kg bags costing Rs 190 or more.

"If the government reduces levies they will be completely passed on to the consumers," Manoj Gaur, Executive Chairman of Jaiprakash Associates who led the delegation of manufacturers said. He said the manufacturers were open to further talks with the Finance Minister, if they were called.
Friday, March 9, 2007
Source: Moneycontrol.com

10 non-metro airport environs may be developed

The airports at 35 non-metro cities including those at Tiruchi, Kozhikode, Tirupati and Hubli could soon get modern terminal buildings, in addition to which, world-class hotels and restaurants may also come around the location. 

This will become possible largely on account of the Government indicating on Friday that it would issue tenders inviting the private sector to participate in the city-side development of 10 non-metro airports within the next two months.

"We should come up with the proposals in the next 45-60 days. The interested parties can respond to these. Even as these proposals are put out, the Airports Authority of India is taking a number of steps to improve the facilities in secondary airports," the Civil Aviation Secretary, Mr Ashok Chawla, said The 10 airports, for which tenders are to be issued within the next two months, form part of the Government plan to develop 35 non-metro airports in a time bound manner.

While the airside and terminal building development at these 35 airports would be done by AAI, the investments for commercial development of land would come from the private sector.

Sources indicated that the non-aeronautical activities that are likely to be allowed at these airports include putting up of hotels, restaurants, parking lots, cargo-handling facilities and other tourism-related activities.

The 35 non-metro cities where the airports are to get a facelift include Nagpur, Thiruvananthapuram, Vishakhapatnam, Vadodara and Amritsar. The Minister for Civil Aviation, Mr Praful Patel, has already indicated that the Government will complete the process of award of contracts for all 35 non-metro airports by 2010.

Asked whether the Government planned to have a model concession agreement for private sector development of airports, the Secretary said that a cell in the Planning Commission was working on developing such a framework.
Saturday, March 10, 2007
Source: Moneycontrol.com

Fashion

Mixed reaction over Union Budget – Damas

Mr. Anaggh Desai, CEO of Damas India said: It is a long term budget. As Retailers selling Jewellery, there are minor advantages of % drop in imports; however this is primarily on Roughs & not on finished Jewellery.

The long awaited relaxation in terms of FDI has not even been addressed. As retailers the price of sale has increased.

The service tax has been extended to renting of immovable property for use in commerce or business and consequently retail organizations will now incur an additional outgoing of 12.36% on the lease rentals of retail spaces.

In a squeezed margin scenario and in a scenario where retail lease rentals are on the higher side in India, this is an additional burden on the operating expenses of retailers.
Friday, March 2, 2007,
Source: www.fibre2fashion.com

Budget sops spoilsport for jewellery industry

Industry players are of the opinion that Union budget 2007-08 could have done much more for gems and jewellery industry to achieve its export target of $20 billion.

Though reduction in import duty on cut and polished diamonds (CPD) from 5 to 3 per cent, rough synthetic diamonds from 12.5 to 5 percent and un-worked coral from 30 to 10 percent is viewed as a positive step, the industry had expected nil duty on CPD.

This would definitely have helped India to emerge from the largest manufacturing centre to the largest trading centre faster, said Mehul Choksi, Chairman, Gitanjali Jewels.

The duty on machinery import at 5 percent would allow the industry to obtain the latest technology for enhanced quality production at competitive rates.

"If we want to make India a global diamond trading centre, it should have been zero. But if there are fears of any misuse, even a one percent duty would have sufficed," Bakul Mehta, former Chairman and Convenor, Diamond Panel, Gem and Jewellery Export Promotion Concil (GJEPC) said, as he felt reduction of import duty on CPD was not enough.

The budget has proposed a favourable assessment procedure for companies which declare profits at 8 percent or more of the turnover.

"Introduction of turnover tax regime in diamonds is a historical step towards enhancing diamond industry growth," according to a statement by Sanjay Kothari, GJEPC. "This principle acceptance of the tax system by the Finance Ministry is affirmative and encouraging. However, the industry expected the turnover tax to be applicable for the entire gem and jewellery sector."
Friday, March 2, 2007
Source: www.fibre2fashion.com

Titan targets potential market of UAE

Titan Industries is targeting UAE for increasing its global presence as annual import volume of the country reached 40 million pieces.

Titan will be expanding regional and global reach with the help of wider watch collections. At present, Titan Wall Street and Titan Noctura are included in its ambitious growth plans and both this collections have more than 150 models.

In order to achieve the target of 15 percent and 8 million watches in 2006-07, company is planning to extend its presence in South Africa, Russia and Pakistan.

UAE plays an important role in global expansion strategy as it is a fashion showcase and re-export hub.

In UAE, products of Titan have presence in more than 100 outlets and company has three exclusive showrooms.

At present, export accounts for only ten percent of total production and they are trying to boost it by five percent.

Company started expansion in South and South East Asia ten years ago and now it has presence in Singapore, Malaysia, Vietnam, Sri Lanka and Bangladesh.

In a study conducted by leading research and consulting organization, company was ranked among 150 top brands in Asia.
Saturday, March 3, 2007
Source: www.fibre2fashion.com

Designers gear up for Wills Lifestyle India Fashion Week

Wills Lifestyle India Fashion Week, an FDCI event, is scheduled to start from March 21 - 26, 2007 at The Ashok, New Delhi.

Fashion designers who will be showcasing thier creations are busy to give last few touches to their collections.

Designer duo Rohit Gandhi and Rahul Khanna will be bringing back the classic 70’s style in black in their designs. Their collection is named as Light Fantastique.

They have created boxy jackets, peg skirts, kimono sleeves and geometric motifs in metallic sheen with the chic textures which is a huge contrast from the balloon silhouettes and flouncy skirts with full of embellishments from the last season.
Monday, March 5, 2007
Source: www.fibre2fashion.com

LFW & Alto Roma announce exchange program for designers

Lakme Fashion Week (LFW) and Alta Roma, promoters of Italian style and the “Made in Italy” concept around the world, announced an exchange program for designers.

Lakme Fashion Week aims to realise the international cooperation and interaction in fashion, design ideology and brand culture through information release and exchange programs, thus enabling Lakme Fashion Week to integrate India into the global fashion world.

Lakme Fashion Week has an inspiring pool of talent that is increasingly providing a stage to showcase their talent abroad. The designers to be selected to show at Alta Roma will be based on the decision made by the LFW Advisory Board and Alta Roma.

Excited with the exchange program, Ms Consuelo Aranyi, Alta Roma said, “Alta Roma plays an important role in promoting the “made in Italy” brand world over. With this exchange program, Italy and India will witness an excellent exchange of talent and creativity. At Lakme Fashion Week this year, Giovanni Cavagna, specialized in Knitwear will display his collection on the Indian runway."

"Also, Alta Roma focuses on creativity and offers an opportunity to all those young designers who have graduated from fashion schools, while generating an ideal continuity between milestone names of high fashion, such as Fausto Sarli, Renato Balestra, Gattinoni, Lancetti, Galitzine.”

Lakme Fashion Week is a joint initiative by Lakme and IMG, the global leader in fashion weeks and event production. LFW has been conceived and created with a vision to "Integrate India into the global fashion world and redefine the future of fashion". LFW is organized twice every year. Lakme Fashion Week Autumn Winter 2007 will be held from March 27th to 31st 2007 at the National Centre for Performing Arts (NCPA), Mumbai.

New successful initiatives like 'Emerging Designer Category' and 'GenNext' was unveiled for the first time in India at the inaugural LFW 2006 with an aim to provide a platform for promising young talent. Both Lakme and IMG have been pivotal to the success of the Lakme India Fashion Week over the previous seven years.
Wednesday, March 7, 2007
Source: www.fibre2fashion.com

Titan Industries announced a significant new introduction in the sporty watch segment with the launch of a unique new collection, the Titan Aviator. Titan brand ambassador Aamir Khan unveiled the new collection at a press conference.

Titan Aviator is an exciting and unique collection of watches inspired from World War II fighter aircraft targeting the up-market, global Indian. This evolved and discerning customer recognizes refinement in designs and aspires for the best in the world while at the same takes pride in world-class products from India.

Speaking at the launch of the Aviator Collection, Mr. Harish Bhat, Chief Operating Officer, Titan Watches, said, "The Aviator Series is one of the finest range of watches from the Titan portfolio. The unique design story behind each of the watches make this the perfect collection for someone seeking a unique sense of style. 2007 is the year of the 75th anniversary of Mr. JRD Tata's first flight of India. The Aviator Series is inspired by his pioneering spirit and is Titan's tribute to India's Aviator number one!"

The watches have been designed by Neil Foley, the Designer of the Year 2006 (Business World Design Awards). Speaking on the occasion, the creator said, "I have a strong passion for flying and have always been inspired by fighter aircraft. The Mustang, Spitfire, Hurricane, Messerschmitt ME 109 amongst others have been legendary machines and these have been the source of inspiration for the designs". Radically different from any other collections ever seen by the market in the recent past, the Aviator Series renders aspects of the fighter planes such as fuselage, cockpit, instrument panels, tail fins, and front propellers into interesting adaptations on the dials, hands and straps. Each watch carries a unique name that symbolises the core inspiration.

The Switch is inspired from an important instrument in the cockpit, which tracked the flight duration and helped calculate other variables of the flight. The Gyro was inspired out of the gyroscope that kept the pilot oriented to the ground while twisting and twirling during the acrobatic flights. Others in the series include Cannon Muzzle, Ejector Exhaust, Artificial Horizon etc. The range has 20 distinct styles, each with an individual story that beautifully captures an aspect of the inspiration and renders it into a form.

Aamir Khan, brand ambassador for Titan said, "My association with Titan Watches began in 2004 when I signed on as brand ambassador and it has been a wonderful experience working with this brand which is dynamic and innovative. It is my pleasure to launch the Aviator Series and I am extremely impressed at the level of ingenuity in its creation. Each and every design reflects an attitude of perfection. I have been impressed by the attention to detail. These styles are truly unique and will appeal to those with a discerning eye and seeking world class products!"
Thursday, March 8, 2007
Source: www.fibre2fashion.com

Real Estate

Realty on Gung- Ho on new Budget

Indian real estate sector seems to be aggressive in the budget, which it believes, will bring a hike in prices with growing demand. The budget seems to have loosened its threads for senior citizens while mooting creation of mortgage guarantee companies.This is likely to encourage home buying, the industry looks relaxed with a cut down in prices of construction material especially cement and steel, resulting in softening of real estate prices.The Finance Minister took up the long waiting demand of the industry and ensured to introduce “reverse mortgage” scheme. Chidambaram also assured to put regulations in place to allow creation of mortgage guarantee companies. Regulations would be put in place to permit the development of mortgage guarantee companies. This will allow housing finance companies (HFCs) and financial institutions to offer loan to people, where HFCs were not earlier eager on.
Thusday, March 1, 2007
Source: indianrealtynews.com

Service Tax Makes Commercial Property Dearer

The decision of Union Finance Minister to levy a 12.5% tax on commercial lease rentals has created a tense situation for the India real estate industry. This may add to the property prices further thereby crippling already suffering consumers, say industry watchers. The service tax is certainly going to pass to property buyers because the landlord will not absorb it. And the tax scenario may put off the potential real estate shoppers. Commercial spaces including shopping arcades and office have got expensive by another 15-20% and the homes by 20%. The tax, however, does not include residential properties, vacant plots for agriculture, land for sports, entertainment and parking purposes and immovable property for educational or religious purposes.
Thursday, March 1, 2007,
Source: indianrealtynews.com

Top retailers are an aggrieved lot

Upset over the government’s decision to charge service tax on the already stinging rentals, they are planning to challenge the decision in a court of law. Several leading retailers like Kishore Biyani of Pantaloon Retail (Future Group), BS Nagesh of Shoppers’ Stop, Noel Tata of Trent and Vinay Nadkarni of Globus among others had a meeting in Mumbai to initiate their future course of action.

A couple of legal firms have already been roped in to advise them on the issue, said sources. Retailers will initially make a representation to the government under the aegis of the Retailers Association of India (RAI). If things still do not work out, they might consider legal options, top officials said. Bottomlines of retailers who operate on thin margins and high volumes are under severe pressure because of the high rentals in an overheated real estate market across the country. Most retailers are unwilling to pass on the burden to consumers since it would negate their competitive edge, i.e., pricing vis-à-vis the traditional kiranas who do not pay rent. There are a couple of retailers, however, who are planning to pass on the burden to consumers.

Monday, March 5, 2007
Source: Economic times

Task force to tackle hotel room scarcity in Delhi, NCR

The government, concerned with the slow pace of rolling out Commonwealth Games 2010 infrastructure in the Capital, has gone into combat mode on the hotel accommodation front. Government sources have revealed that a task force has been formed under the chairmanship of a joint secretary - tourism and additional director general - tourism for monitoring the creation of additional accommodation in Delhi and NCR region.

According to the tourism ministry officials: “We have prepared a status note stating that we are in touch with all land owning agencies for creating additional hotel rooms in the NCR region and the status note has been sent to sports minister Mani Shankar Aiyar.”

The status note estimates that a minimum 30,000 to 35,000 hotel rooms would be required in NCR by 2010, out of which a minimum of 20,000 additional hotel rooms will be required in Delhi itself. Some of the important issues raised by the tourism ministry are the creation of land banks, giving land on long lease, grant of additional FAR, greater commercial utilization and change of land use for hotels.

The task force after meetings with land owning agencies has asked them to identify more hotel sites, adopt a single window clearance approach and to focus on the budget category hotels by giving land on long lease.

Says Rajji Rai vice president Travel Agent Association of India (TAAI):“In Delhi, 70% of the commercial land comes under the DDA, which has now started releasing it. The industry is willing to pay the prevailing market price but we are looking at places where a hotel would be a viable option.”

Agrees Kamal Taneja MD, TDI Group:” The government can attract investment by offering long term leases on their land for new projects and tax holiday incentives. We are happy that the budget proposal give a five-year tax holiday to two, three and four-star hotels in the national capital territory of Delhi, ahead of the

Commonwealth Games as we are looking into the possibility of coming up with such hotels in NCR region. ” For instance, Delhi Development Authority (DDA) has indicated that 26 hotel sites would be provided for the Commonwealth Games and an additional 10 more hotel sites would be identified for budget hotels. Similarly, tourism minister Ambika Soni met Railway minister for identifying railway land for hotel purposes. The railways has identified three sites namely Anand Vihar, New Delhi Railway station and Nizamuddin.

Also, it should ensure that new projects add special value to a city — incentives should be offered only if a new project adds to the city’s infrastructure. The infrastructure still remains a major stumbling block for this sector’s future growth. To get down to basics, 1.3 lakh hotel rooms are needed to cater to the projected six million tourists this year, while the country today has only 92,000 operational rooms. And the tourism industry is obviously worried.

KB Kachru country head, Carlson Group:“The industry, in close association with the government, should take innovative measures to fill in the gap.The supply-demand gap will take a long time to bridge with conventional methods. In the old system, good times meant a rush to drawing boards and a flurry of new construction. But new supply will take time to add —instead, we should soon take some innovative measures like providing special incentives like interest and tax subsidies, for completion of hotel projects in record time to speed up the supply.”

Monday, March 5, 2007
Source: TNN through economictimes

DLF plans international convention centre in Goa

Real estate major DLF has bagged the Goa government contract to develop an international convention centre in the coastal state.

The Delhi-based group, being the highest bidder was awarded the contract at Rs 400 crore. The company will pay the state government Rs 161 crore upfront and the project will be developed on a BOT (build operate transfer) basis. “Goa has an international connection; it’s been listed in the top three tourist destination in the world at the turn of the millennium. A conventional centre here will be very profitable,” said Rajeev Talwar, executive director, DLF Group.

The company has been given a 30-year lease and will pay 5% revenue to government from the fifth year onwards. The project will be set up within 18 months over 25 acres at at Dona Paula, Panjim. However, the said land is presently under dispute between the Goa University and state government, but high court had granted Goa government permission to continue with tender process.

Apart from a gymnasium, shopping mall and other recreational activities; the centre will have two international hotels which is likely to be developed by DLF’s JV partner and international hotel giant Hilton. “I don’t see why Hilton won’t partner us here. It’s an excellent opportunity,” said Mr Talwar adding, “Investment in conventional centre brings in one-and-half-times higher returns than normal tourism, since most guests coming here are normally sponsored. It’s very high quality controlled tourism giving highest returns.”

Though Goa hosts several conventions at its many five star resorts; non-availability of hotels due to high influx of tourists and lack of rooms with large seating capacity, has prevented many international conventions from being hosted in Goa, said market analysts. Source: TNN through economictimes, 6tht Mar’07

The year 2007 is expected to witness a fair amount of premium residential projects with extensive construction activity underway in South and Central Mumbai. Most of these are being developed in condominium style, offering state-of-the-art amenities and would be ready for occupation over the next 12-18 months.

Numerous developers have been offering large four to five bedroom apartments ranging between 4,000 - 8,000 sq.ft. (super area), quoted at INR 30,000 to INR 40,000/sq.ft. (on super area). Staggered payment based on construction stages and the benefit of relatively lower prices, achieved by pre-committing to a project, is drawing interest from end-users and investors alike.

However, these parts of the city continue to face a paucity of adequate ready-to-occupy apartments; coupled with a clear demand for 2/3/4 bedroom apartments ranging between 1,400 sq-ft. to 2,200 sq.ft. of net area. This demand-supply mismatch has led to rapid escalations of prices over the last quarter. Till a year back, rates commanded by old, well maintained buildings in prime localities, ranged between INR 18,000 to INR 28,000/sq.ft., however, some of the prime buildings now command up to over INR 30,000 to INR40,000/sq.ft.

Several projects, which are in various stages of construction in Northern suburbs along the Malad - Goregaon - Kandivili belt and Andheri/ Powai, are expected to be completed in the next 12 - 24 months. This may lend stability to prices. However there continues to be a shortage of apartments for immediate occupation. With considerable commercial activity in the northern and northeastern suburbs, it is anticipated that the demand-supply gap and lack of infrastructure will be a continuing limitation.

Outlook: With demand far outweighing ready supply, rental values are likely to rise in prime buildings in most parts of the city. We however expect prices/ bookings to slow down in premium projects that are under-construction, which primarily offer large configurations, as the number of prospective purchasers for such high value apartments is limited.
Saturday, March 10, 2007,
Source: economic times.com

Shop-a-mall!

With upgraded lifestyles and a higher affordability status the high rise concrete clusters have newer entrants--shopping malls. Malls are more a part of a culture than anything else with wide choices in everything from a floor cleaning liquid to chocolates.

All in the mall! All world class brands and a classic location is all what a mall needs to be flocked with eager shoppers. One such mall in the making by the Goel Ganga group --East Point-- is springing up in Kurla, Mumbai, at the entrance point of Kurla (E) station. Small tiny cubicles selling food products and milk pouches are run of the mill and thinning into the past now. As the customer assumes the king's throne, malls ease his shopping experience and make it amusing.

"Kurla as a destination was perfect for a mall, as this particular location is just ideally situated at the entrance or exit point of Kurla East station, a total ready walk-in count as far as any shopping venue can ask for," notes Atul Goel, director, Goel Ganga Group. " In addition, this railway junction is not only an important one for its history and requirement, it is also a main established shopping or commercial business market, which is here to stay," he adds. The project viability enabled them to go ahead with the plan and execute the mall construction. Win Win Situation! Not only the customer but a shopping mall is a better place for both sellers as well as buyers. The display is huge and the buyers can take their own time to choose according to their tastes and price preferences. Looks like the Goel Ganga Group is gauging the pulse of the buyers and offering them options to suit their changing tastes and budgets.

Supposedly the added fact is that this will be the first mall of its kind in its vicinity, and what other better way to start than the east point in Kurla! As there already was a ready and active market there, the mall culture had an adept and inadvertent foundation here.

Goel Ganga group have in their kitty three decades of experience and expertise in the construction activity, which plays host to varied types of construction activities, catering to residential , commercial, hospitality, education, and any other construction related activity. "So , irrespective of the city and project type, construction is our forte," assures Atul and continues, "Our systems are based on quality, environment and welfare policies, with professional teams on board."

Saturday, March 10, 2007
Source: economic times.com

Real estate investments likely to fall

Private equity players investing in the real estate market may not be a happy lot, with abundant commercial and residential supply likely to hit the market in 2007, as returns on real estate investments are likely to fall, reports CNBC-TV18.

The lucrative real estate market may not remain as profitable for private equity investors or developers as it has been in the past two years. The higher dividend distribution tax and the 12.36% service tax on commercial rents imposed by the Budget will eat into returns of investors. This comes on top of surging land prices, which have sharply reduced the margins of developers.

"There is too much liquidity foreign funds chasing the limited land supply so automatically the prices of land are very high and as a result of high land prices returns or margins of developers, investors, private equity players have fallen drastically" says Subodh Runwal, Managing Director, Runwal Group.

On the other hand a slew of developed projects are likely to flood the market this year. Realty consultants Cushman and Wakefield projects that business hubs like Bangalore will add 16 million sq feet of developed office space, Chennai will another 12 million sq feet, Delhi and the NCR region will see 10.5 million square feet of new office space and the commercial capital Mumbai will see 9.1 million square feet entering the market. Though nearly 40% of this office space is estimated to have been already pre leased to tenant, developers expect prices to fall with so much supply entering the market.

Rupee returns is expected to be 15 to 20%, which is lot more than what is expected from markets like Australia or Europe. So people will get returns of 15 to 20% not euphoric returns of 30% about which we have talked earlier,” adds Pranay Vakil, Chairman, Knight Frank

The other factors that are likely to impact investor returns are raising construction costs for developers and also higher interest rates for genuine homebuyers, which may dampen buying sentiment. These will also contribute to the correction in real estate prices

Experts say that though private equity investors are unlikely to flee the Indian real estate market they will certainly re-examine their investments in India. Nearly USD 17 billion is waiting to enter the market, but all of it may not come in.

Saturday, March 10, 2007
Source: www.moneycontrol.com

Tier II Cities

Pune rides high-end boom

It began with a premier project about four years ago when the City Development Corporation (CDC) built 1, Modi Baug, an 80-flat development, with flats in the Rs 1-crore bracket. That was a pioneering effort. But today high value flats in Pune are a growing trend.

Developers maintain that the bar for the super-premium luxury housing has risen from Rs 1 crore to over Rs 2 crore. “There are a lot of flats being built in the Rs 1-crore bracket because prices have risen. If the cost of construction is Rs 4,000 per sq ft, then even a 2,500 sq ft flat falls in that category. A super premium flat in Pune is now usually around 5,000 sq ft and priced around Rs 2 crore,” says R Vasudevan, chairman and managing director, Vascon Engineer.

It is a view to be heard all around and more developers are building such premium homes. While Paranjape Schemes are looking at developing 20-30 acre ‘second home’ bungalows, with a half acre plot and a bungalow for Rs 1.25-1.50 crore, CDC has lined up the city’s first high rises: 22 floor buildings with flats of 5,000 sq ft each.

At Rs 4,000 per sq ft construction cost, these carry a price tag of Rs 2 crore, says Aniruddha Deshpande, director, CDC. While developers agree that the rising income and purchasing power of professionals, particularly from the IT sector, is the cause for such luxurious dwellings, there are other factors as well. “When a 7,000 sq ft flat in south Mumbai costs Rs 25-30 crore, people think they have got a good deal with a 5,000 sq ft home in Pune,” Vasudevan explains.

Beyond software professionals and people looking to relocate in Pune from Mumbai or even from overseas, are the older people who have sold a bungalow and want to live in spacious, easy to manage surroundings. Vasudevan says that the Ivy Glen development, at Kharadi, comprises flats of 4,000 sq ft on one level. “Often, those who have sold bungalows do not want to live in flats with split levels. So, we are offering 4,000 sq ft on one level, at over Rs 2 crore,” he points out.

The outdoors, and get away ‘second’ homes is a category that is appealing to most people, especially when the plot is a half acre one, says a Paranjape Schemes’ spokesperson.

“Lakeside View, at Pirangut, is a forest establishment and work begins on the project from April. But we have already sold six or seven of these homes,” he says.

The focus is on luxury and privacy, which manifest themselves in heavy security, most of which is unobtrusive. Access control, individual swimming pool or pools with limited-to-residents access, jaccuzi and high end club houses are all part of the style statement. Then, there are lifts, separate for servants and, in the case of Ivy Glen, the lift reaches your foyer, a fully fitted kitchen, fully air conditioned...the list just goes on.

With residents often pulling down their old bungalows and replacing them with steel and glass buildings, there is scope for bungalow schemes, all over. Each of the high end builders, and their number is also growing, is planning a bungalow scheme. So, if its Lakeview Estate for Paranjape Schemes, Vascon’s got Forest Hills.

This will be a 19 acre, gated community at Kharadi, with a plot of 8-10,000 sq ft, and 65-70 bungalows, each of 4,500 sq ft, priced at over Rs 3.5 crore.

The upward mobility displayed in the buying of high end property, Deshpande says, affects all sections. “You get a not very young owner of a three-bedroom flat, whose children are now settled elsewhere, wanting a larger two bedroom flat.

There is another trend, of couples whose children are settled, wanting a four bedroom flat: they convert the fourth bedroom into a home theatre. Every 10th person today has a home theatre,” he observes. While the numbers of high value flats are hard to come across, Deshpande maintains that this year, they are expected to comprise 25% of the total built-up area in the city. “The luxury market is growing. And for some, a 3,500 sq ft home is a basic requirement,” he says.

Monday, March 5, 2007
Source: TNN through economic times.com

Real attractions

While there is a definite trend in favour of amenities, let us take a closer look at what some of the projects by Nashik's leading builders have on offer.

Suyojit Buildtech's new project covering an area of 100 acres is billed as the 'biggest super luxurious scheme' with new generation lifestyle apartments, smart homes with smart features, a well designed entrance foyer , landscaped podium garden, well-equipped gym, children's play area with modern equipment.

The project offers Wi Fi enabled homes, a grand 5 star lobby, cross ventilated layouts, luxury amenities, a club house, hitech 24 hour security and vantage retail and showroom space. The infrastructure includes a hospital, school, mall and multiplex making it a virtual city in itself.

If you're looking for a more compact project, there's Madhur Mangal Park located off Mahatma Nagar. It has a total area of 3 acres and is being built by Madhur Buildwell. The amenities comprise vitrified flooring, a 2000 sq. ft. hall, society lawns, landscaping that is already in place, a jogging track, amphitheatre, gym, central security with intercom, kids play area, allotted parking and intercom system in each flat.

The Vini Park project at Deolali by Bindu Developers comprises of sophisticated bungalows, twin bungalows and plush row houses. Spread on ten acres of lush green dale of 2000 exquisite trees, manicured gardens and trails encompassing state of the art swimming pool, kids pool and jacuzzi, centrally located clubhouse with all facilities like gym, sauna and steam bath.

Samraat Group has three upcoming projects - Dream Villas, Dream Cottages, Dream Flowers - located off Fame theatre. The project boasts of AC lobbies, lounges, AC pathways and 5 star facilities. Subhadra Estates offers landscaped gardens , roadside tree lining and chain link sensing for the complete layout of its Royal Town project.

Hari Vihar by Karda Constructions offers a gymnasium, clubhouse, landscaped garden, lift with backup, children's play area, elders park, security system and allotted parking. Shree Mangalmurti Gardens, the latest project of Shree Buildcon and Association provides spacious garden, 24 hours home security , Kone Lift with power back up, vitrified tiles, granite kitchen platform, LPG gas pipeline and invertor, fire fighting system and allotted parking.
Saturday, March 10, 2007
Source: economic times.com

A synchronized evolution: The property paradigm shift

Until a few years ago, homebuyers in Nashik seldom considered any aspect beyond the project location and pricing. Therefore, the type of homes constructed during that phase was mostly in the 'no frills' category.

However, with the city and its peripheral areas undergoing a major transformation in terms of infrastructure and the influx of ITES sector firms, the demand for new homes has also changed in tandem. Builders are gearing up to meet the new buyer requirements of bigger homes with better amenities and plenty of greenery.

Just glance at any of the new housing projects coming up in Nashik and you will find them providing an upmarket ambience and leisure facilities that are increasingly being brought on par with those in major metros like Mumbai and Pune. Fully equipped with the latest amenities and lots of greenery, these eco-friendly projects reflect the new, modern face of Nashik.

"The demand for luxurious houses has always been there, but there was a lack of supply. Today, city builders who give the best of quality with transparency in dealings have bridged that gap. Investors from the city or all over the world are interested in the community living concept. Project quality and facilities matter more than the location today," explains Anant Rajegaonkar, President of PBAN and Founder Director of Suyojit Buildtech.

Arvind Patel of Madhur Buildwell, says, "Today owning a bungalow is no more the only aspiration. Good flats and row houses are the present trend. The buying capacity of investors has grown, coupled with easy loan facilities, so they want to go in for an ultramodern kitchen, luxurious bathroom, etc. The best part is that several innovative projects, which the city has never seen before are on the way."

Sujoy Gupta of Samraat Group echoes their sentiments. "The spending level has definitely gone up; hence the preference is shifting to highclass products. People are now mentally prepared to spend more for amenities as well as their maintenance. Swimming pools, gymnasiums and clubhouses for 'chill out' sessions and programmes like birthdays and get-togethers are very much the 'in' thing. These changes are in sync with the ongoing and upcoming renovation of the city," he says.

Naresh Karda of Karda Construction points out that in addition to these reasons, aspects like the improved infrastructure; new commercial facilities available and many retail outlets coming up indicate that Nashik is truly becoming the city of choice. The icing on the cake, he feels, is that the new projects are well connected by road and possess all the modern necessities.
Saturday, March 10, 2007
Source: economic times.com

Sector Specifics

Automobile sector:

Hyundai plans foray into const equipment

Monday, March 5, 2007
Source: Business Standard

M&M clinches bid for Punjab Tractors

Mahindra & Mahindra (M&M) has won the bid for acquiring controlling stake in Punjab Tractors. Negotiations for the deal carried on till late Thursday night. Sources said that the sale has been verbally agreed to and will be signed, barring any last-minute glitches. According to sources, M&M bagged the bid at about Rs 360 per share, and is acquiring about 43 per cent stake in the Chandigarh-based tractor firm for close to Rs 1,000 crore in an all-cash deal. The 43 per cent stake includes 29 per cent owned by private equity firm Actis and 14.2 per cent by the Delhi-based Burman family. According to sources close to the development, M&M emerged the highest bidder and appears to have upped the bid after three days of negotiations, as the bidding deadline closed on Monday. "M&M is the highest bidder. Both M&M and Ashok Leyland have offered all-cash deals," the source said. Earlier reports had suggested that Ashok Leyland may have been the frontrunner for the stake, but the company had laid out certain preconditions for the acquisition. Industry analysts said that the pre-conditions might have had to do with the receivables condition of Punjab Tractors and a roadmap for acquiring further stake in commercial vehicles firm, Swaraj Mazda, in which Punjab Tractors has 14 per cent stake. Purchasing controlling stake in Punjab Tractors will help M&M increase its share in the domestic farm equipment market to 40 per cent from over 30 per cent currently. However, in what could be a matter of concern for the bidders, news agency reports from Chandigarh quoted Punjab Government officials as saying that the Government would consider launching a probe into the privatisation of Punjab Tractors by the previous Government. They also warned that whoever was bidding for the company was doing so at their own risk. "The new bidders and anybody participating in the further acquisitions would be doing so at their own risk and responsibilities," an official spokesman was quoted as saying. Actis had acquired 23.45 per cent in mid-2003 from the Punjab Government at Rs 153 per share. The firm has invested about $60 million in Punjab Tractors till date.
Thursday, March 8, 2007
Source: thehindubusinessonline.com

Telecom Sector:

Essar to hawk mobiles

The Ruias plan to expand their presence in telecom retail, which will be spearheaded by Essar Telecom Retail. “We are a long-term player. The group is committed to telecom retail and we are targeting all sections of consumers. My target is to sell a million handsets every month over the next six to eight months. I am confident that we could get a 10 per cent market share within the next three years,’’ Essar Telecom CEO & director Rajiv Agarwal said. This will involve a total investment of $250-300 million, Agarwal added. Essar Telecom’s chain of multi-service outlets, called The MobileStore, is present in eight cities. The company plans to have more than 2,500 outlets over the next three years in 600 cities. The company will roll out these stores in three formats. These include large stores spread over 1,000-1,500 sq ft, medium ones spread over 800-1,000 sq ft and the compact version in the 200-500 sq ft range. It is also eyeing a ‘shop-in-shop’ format for the malls.

Sunday, March 4, 2007
Source: The Telegraph

Airtel's Enterprise Services gets global certification

Enterprise Services Corporate (ESC), a business division of Bharti Airtel Ltd, has received the TL9000 certification, given for quality management system for mobile, fixed line and data services. ESC got the certification in recognition of its initiatives to enhance quality management across the corporate division of the organisation and is the the first integrated telecom service provider in India to get it, Bharti Airtel said in a release here. The TL9000 certification has been conferred on ESC for the Voice, Wireless, Transport Networks, Private Networks and Internet Access product categories.

The scope of the certification includes sales and marketing, design of services, customisation of business solutions and provisioning and customer support services for telecom products (voice and data) for enterprise customers across all locations of the business units.

TL9000 Quality Management System has been developed by the QuEST Forum and is a globally recognised quality standard for the telecommunications industry.

Monday, March 5, 2007
Source: PTI

Delay in 3G spectrum policy creating uncertainty: CDG

A trade body representing CDMA mobile operators on Monday cautioned against further delay in announcement of spectrum policy for Third Generation mobile services, saying such a delay would put India behind other countries and deprive its citizens of better services. 3G services allow mobile companies to offer real-time interactive services like high speed Internet, video streaming and financial trading. To release 3G spectrum for mobile players, the Defence Ministry is supposed to release 45 Mhz of spectrum by the end of this year in the IMT 2000 band and 1800-1900 MHz band. CDG said the announcement of the 3G Spectrum Policy should not in any way be linked to the delay in the release of the spectrum in the 1800 MHz band, which was part of the 45 MHz of spectrum that was to have been freed. CDG recommended that to create a level playing field amongst operators and restore parity from the economies of scale that the 2100 MHz band will offer GSM operators, CDMA operators in India should be allowed to offer CDMA2000 1xEV-DO services (3G services) in their existing 800 MHz band. The Department of Telecom should seriously consider TRAI's recommendations regarding the feasibility to deploy and release 1900 MHz to the CDMA operators concurrent with the release of 2100 MHz Spectrum. The bone of contention between CDMA and GSM players have been the allocation of 1900 Mhz band. As per the TRAI recommendations, the 2.1 GHz (2100 Mhz) spectrum is for both GSM and CDMA operators. While CDMA operators have been allotted spectrum on 800 MHz, the 900 and 1800 Mhz bands are for GSM. TRAI has proposed to introduce 2.1 GHz for both CDMA and GSM and 450 MHz for CDMA. As per a relocation plan given to the Defence Ministry by DoT, the Ministry will release 45 Mhz of spectrum by the end of this year for providing 3G services in the IMT 2000 band and 1800-1900 MHz band. Finally, the CDG encourages DoT to make the entire spectrum allocation and management Technology Neutral so that all future allocations of spectrum are made in equal measure to both of the deployed technologies. The CDG has corresponded with the DOT on this matter.
Tuesday, March 6, 2007
Source: PTI via India News Online

Agriculture

India, Australia to remove barriers to agri trade

India and Australia have agreed to set up a mechanism to resolve issues coming in the way of trade in agricultural goods between the two countries. "We have agreed that officials from both sides would sit down and see if there are any issues regarding trade in farm produce between the two countries and resolve them," Australian Trade Minister Warren Truss said at the 16th Meeting of India-Australia Joint Business Council.
Favouring greater trade in agriculture goods, he said whatever restrictions are put in place due to concerns on pests and weeds would be based on science.

He was responding to demand from the Indian side to allow imports of mangoes. Australia is also a major exporter of agriculture products and is a member of Crain Group in WTO, which free trade in farm products.
Truss also said officials of two countries would also look at easing visa regime for businessmen from both sides. He said Australia wants that India should give long-term multiple entry visas to Australian businessmen.

Pointing to the prospects of manufacturing sector in India, Truss said, as Australia has small population it would have to depend on others for manufactured products and would in turn like to supply food, fibre, minerals and energy.

At the Joint Ministerial Meeting, Commerce and Industry Minister invited Australian investment in mining, farm and education. He said India was committed to the second generation of reforms that would improve governance and help consolidate gains from first stage of reforms.
India-Australia trade has been growing at a rapid pace and touched 5.7 billion dollars in 2005-06 from just 1.4 billion dollars in 2000-01.

Thursday, March 1
Source: PTI through Economictimes

Happy at industry growth, PC roots for farm sector

Betting on the ‘auto-pilot’ India Inc story, finance minister (FM) P Chidambaram on Thursday reposed his faith in industry to continue clocking higher growth figures and contribute to buoyancy in tax collections. With an investment-to-GDP ratio at 33%, the FM was confident that India Inc will contribute to world output projected to grow at 4%. The minister also urged the industry to hold the price line to help the government contain rising inflation.

“I am relying on your growth, your performance, your innovation , inventiveness, your ability to reach new markets,” Mr Chidambaram said at a post-Budget interaction with the industry. Defending his pro-agriculture sector moves in Budget 2007-08 , he said that Indian industry is ‘mature today’ and doesn’t need government attention, stressing the fact that it is the agricultural sector that requires government intervention.

“Just imagine what can happen to industry and services if agriculture grows at 4%. It is in your interest that agriculture must grow at 4%,” the FM said. By addressing areas of production , productivity, seeds, power and fertiliser, the government is trying to increase its intervention in administering agriculture, he said. The industry pitched in a demand to review the multiplicity of taxation resulting in embedded taxation which increased the effective tax rate and blunted competitiveness.

It was said that the MAT extension on money market instruments , disincentivised debt investment. It was argued that in order to incentivise slackening bank deposit growth in the face of a higher credit offtake, the solution was not to discourage investment in debt. The FM said that he has been repeatedly reassured that the growth in the Indian economy was not on account of a “cyclical upturn” but a result of a “structural shift” in the economy induced by industry and services.

Excise hike for not sticking to price line

“The cement prices in different parts of India vary significantly to the extent that cement is a virtual regional market. Because of such a huge demand for the product, I had cautioned the industry at a recent FICCI meet, to abstain from pushing up prices. While most industries have stuck to ‘holding the price line’ , cement prices have gone beyond all reasonable limits. Therefore, we say, we will try to reward those having inclination to hold the price line, but we will tax anyone using that opportunity (of huge demand) for making huge profit, ” said FM P Chidambaram . The Budget has proposed to decrease excise duty by Rs 50 per tonne for cement priced up to Rs 190 per bag and increase it to Rs 600 per tonne from Rs 400 for those above that level, reports Our Bureau from New Delhi.

Friday, March 2, 2007
Source: TNN through Economictimes

Winter rains godsend for GDP growth

Given normal winter rains, which portend well for farm growth, economists are hoping that agricultural output in the last quarter of the current financial year will improve and push annual GDP growth to around 9.2 per cent for 2006-07. Planning Commission Advisor Pronab Sen sees robust agriculture growth in the last quarter of the financial year. “If rabi crop turns out to be good in the fourth quarter, agriculture growth will be healthy,” said Sen. In the third-quarter of 2006-07, agriculture grew at a meagre 1.5 per cent, compared with 8.7 per cent in the same quarter last year. The economy grew at 8.9 per cent in the first quarter of the year, 9.2 per cent in the second quarter and 8.6 per cent in the third quarter. This translates into an average 8.9 per cent annual growth till December 2006.
Monday, March 5, 2007
Source: Business Standard

All efforts made to enhance agri productivity

Asserting that all out efforts were being made to enhance agriculture productivity to ensure supplies of foodgrains and other essential commodities, Prime Minister Manmohan Singh on Thursday said India needed massive industrialisation for shifting employment from the farm sector.

Admitting agriculture growth momentum has been a "problem", Singh, replying to the Motion of Thanks on the President's Address in Rajya Sabha, said India must look at industrialisation for taking care of unemployment and underemployment.

Apparently referring to the opposition to the setting up of a Tata Motors project at Singur in West Bengal, he said one or two such incidents are bound to be there.

The Prime Minister said West Bengal Chief Minister Buddhadeb Bhattacharya had emphasised on the need for industrialisation.
Thursday, March 8, 2007
Source: PTI through Economic Times

India Inc. to join govt to push farm growth

The UPA Government has put together a foolproof strategy to achieve 4.1 percent farm growth annually. And, the Government proposes to involve private Indian corporates in a big way to ensure this growth rate.

While Prime Minister Dr Manmohan Singh proposes to dovetail the regional plans into the government’s farm growth strategy, the Union Agriculture Minister Sharad Pawar has held a series of meetings on this issue during last one week in the aftermath of Finance Minister P.Chidambaram’s Union Budget. This strategy paper is likely to be put before the Union Cabinet for its consent shortly.

This assumes significance in the wake recent reverses the ruling alliance experienced in states like Uttaranchal and Punjab where the farm policy and farmers suicides became a major plank for the opposition parties.

Agriculture Ministry has decided to retain its earlier projection for 4.1 percent annual growth in farm sector to ensure 9 percent GDP growth.

Having taken this decision, the Agriculture Ministry is fine-tuning its plans for expansion and enhancing the farm yields. Sources divulged that a clutch of measures would be initiated during next few months to ensure the 4 percent plus agriculture growth. From fertilizers pricing policy to irrigation, seeds, crop husbandry, quality of seeds to bringing more land under farm sector would be addressed sources said.

A 19-page draft note has been put together by the Agriculture Ministry that also targets an additional 15 million hectares land to be brought under irrigation and made suitable for agriculture.

The draft note on “roadmap to achieve 4 percent growth” with www.economictimes.com has proposed “restructuring policies for achieving accelerated, broad-based and inclusive growth” in the entire chain of activities associated with the farm sector.

For instance, in the fertilizers sector, the UPA Government proposes “reforms in pricing policy” to discourage imbalanced use of farm nutrients, ensure balanced availability and encourage use of non-chemical fertilizers. The centre, according to sources, would also work on a strategy to deliver subsidy directly to farmers. Finance Minister has already talked about a pilot project in the Union Budget last month.
Friday, March 9, 2007
Source: INN through Economic Times