Indian Economy - News & Updates - Archive

[Screaming Skull]

Wheat buys may be higher than estimated to stop distress sales​

10 Apr 2009

NEW DELHI: Two years of high priced imports in 2006 and 2007, one year of record output at 78.5 million tonnes and now, slam dunk into subsidised
exports of massive central stocks. The United States department of agriculture (USDA’s) February prognosis on India’s wheat glut situation and the necessity to subsidise exports from overflowing central reserves in May or even earlier may be set to prove prophetic.

Persisting reluctance from traders and flour millers to make large buys from UP, the largest wheat producing state, despite plunging support prices (between Rs 70-130 per tonne) has begun to spell out just that. According to current estimates wheat production this season could be only 76 million tonnes compared to earlier projections of 78.5-80 million tonnes.

Despite that, trade projections are that central buys will be higher than the targetted 24 million tonnes by almost two million tonnes, thanks to few buyers and the clear possibility of distress sales by farmers at the crucial election time. Last year, wheat output was 78.5 million tonnes and procurement by the government was 22.6 million tonnes.

Interestingly, the latest USDA report has pegged Indian wheat output at 78.6 million tonnes for 2008-09, compared to the government’s estimate of 77.78 million tonnes. That is some two lakh tonnes over its earlier estimate, a record output for the second consecutive year.

“Untimely inclement weather will not impact the total output of wheat but will impact the quality of produce in Punjab and Haryana. That could lead to around two million tonnes of poor quality wheat from these states. We are unlikely to purchase from either state due to higher prices (ruling at MSP of Rs 1,080 per tonne) and poor quality. Even if taxes are reimbursed, poor quality wheat means a much shorter shelflife. Gujarat and UP have much better quality crop. So, there is increased pressure on the FCI to buy,” emphasises D P Singh of the All India Grain Exporters Association.

“That means that the government will have to pick up more wheat than earlier targeted from these states to prevent distress sales. State agencies will also have to buy heavily. It will lead to godowns that are bursting at the seams and hike up pressure manifold on the government to open up exports early,” he adds. A recent EgoM decided in principle to revoke the two-year old export ban but no specific date has yet been set.

Ironically, for two years running, in both 2006 and 2007, the government’s miscalculation on wheat output and procurement from UP led to high priced imports. What that could cost the exchequer is anybody’s guess, at this juncture. According to one wheat trader who procures for bigger companies, the timing is still “too premature” to project the extent of subsidy per tonne on wheat exports that the government may be forced to give in order to force out the commodity. But, the fact that subsidy will have to be given is virtually “a foregone conclusion”, he said.

The Centre’s refusal to tap into market output intelligence to clarify its own estimates on wheat is threatening to be yet another marked example of delayed and over cautious government policy bringing farming gains to nought.

With global wheat prices plunging of late, traders see little possibility of prices firming up by May in time for massive Indian exports to gain. “We see no chance of global wheat prices firming up by May, irrespective of what analysts said earlier.

 

[Screaming Skull]

US downturn dents demand for H-1B visas​

New Delhi, April 9 The US economic downturn has hit the demand for H-1B work visas. The US has announced that it is yet to receive enough H-1B petitions to reach the cap of 65,000, stipulated for fiscal 2010.

The window for filing the H-1B petitions has been open for since April 1 and the muted response – though on expected lines – is a grim reflection of the weak US economy and the job scenario.

“The visa cap has not been met yet as there is not enough business in the US. The visa update also validates our argument that H-1Bs are not being used to replace American workers, because if that was so, companies would have flocked to file petitions amid lay-offs in the US. That has not happened,” the Nasscom President, Mr Som Mittal, told Business Line.

He said that Indian companies which had cornered 11,000 visas last year would have filed far less applications this year, but did not comment on specific numbers.

In 2008, four of the top five H1-B recipients were Indian IT firms including Infosys Technologies, Wipro, Satyam and TCS, while the fifth was Microsoft.

Infosys topped the 2008 list with 4,559 visas followed by Wipro (2,678), Satyam (1,917) and TCS (1,539). When contacted spokespersons of both TCS and Infosys declined to comment on the applications filed this year citing a silent period ahead of the results. However, a top industry expert said that total applications by India Inc. could have fallen by as much as 70 per cent.

Ms Poorvi Chothani, a US immigration attorney based in Mumbai, admits her firm has seen a 50 per cent drop in H-1B filings this time. “Besides the fact that the basic demand is less, other factors such as a possible fear of a backlash in employing foreign professionals, and Troubled Assets Relief Program (TARP) curbs are likely to have influenced the filings,” she said.

For FY2010, USCIS has reportedly received just “about half” the applications it needs for the 65,000 general slots, but has nearly all of the applications it needs to fill the 20,000 slots (US masters’ degree or higher that are exempt from the cap).

Earlier this month, Software giant Microsoft too had stated that it is filing less petitions for work visas due to the economic downturn.

Given that the H-1B filing are below the stipulated cap, the USCIS said Wednesday that it will continue to accept petitions, although it has not yet affixed a date for closing the filing window. It said that once it receives the required number of petitions to meet the respective caps, it will issue an update.

US businesses use the H-1B program to employ foreign professionals in speciality occupations that require theoretical or technical expertise in fields, such as scientists, engineers, or computer programmers. There is an annual limit of 65,000 on H-1B workers. Additionally, another 20,000 H-1B petitions are set aside for those who have earned a US masters’ degree or higher.

 

[Screaming Skull]

India Inc asks Obama to avoid protectionism​

10 Apr 2009,

NEW DELHI: India Inc on Friday asked the Obamba administration not to yield to public pressure on protectionism, stating that the 'Buy American' restrictive policy would dent America's credibility among global trading nations.

Indian industry leaders were reacting to protests early this week in the US against use of India-made steel for an oil pipeline project in Illinois, the home state of President Barack Obama.

"It is disappointing. The US administration should not give in to such demands, as protectionist measures go against the spirit of global trade," FICCI President Harsh Pati Singhania said.

The protectionist tendency can spiral from one industry to another and be a deterrent to free trade, he added.

Assocham said it reflects the increasing internal pressure on developed economies against outsourcing.

"...Those who are advocating free economy are more for adopting protectionist measures because they are under internal pressure," Assocham Secretary General D S Rawat said.

India's iron and steel export to the US more than doubled to $ 924 million in 2008 over the year-ago period.

It may be noted that within a week of the US joining the G-20 declaration to "name and shame" the countries resorting to protectionism, hundreds of steel workers in US protested the use of India-made steel for an oil pipeline project in Illinois, the home state of President Barack Obama.

Nearly 1,000 protesters joined a rally organised by the United Steel Workers yesterday demanding the 'Buy American' policy for the US ventures, including the 2,000-mile Canada-US oil pipeline project.

 

[Screaming Skull]

‘Stimulus measures to have effect from April-May’ ​

NEW DELHI: With stimulus packages failing to spur industrial production, Chief Statistician to the Government, Mr Pronab Sen on Friday said the fiscal measures will have start having an impact on industry from April-May onwards.

In an interview to PTI, Mr Sen also attributed the fall in industrial production in February largely to negative growth in consumer non-durable goods, particularly sugar.

“Stimulus packages will start having an effect from April-May onwards,'' said Mr Sen, who is also Secretary to the Ministry of Statistics and Programme Implementation. Mr Sen said tax cuts will have much quicker effects, but expenditure measures take so me time to produce results.

The Government has so far announced three stimulus packages in which excise duty was cut by six per cent and service tax by two per cent, planned expenditure was raised, infrastructure re-finance company IIFCL was allowed to mobilise resources through ta x-free bonds, and so on. However, despite these measures, industrial production is not showing any perceptible improvement.

In February, industrial growth again turned negative as factory output declined to a 15-year low of 1.2 per cent. “(The) main reason for (the) negative number in February IIP (Index of Industrial Production) is that ... we saw negative numbers for cons umer non-durables and this is coming largely from sugar,'' Mr Sen said. - PTI

 

[Screaming Skull]

Govt invites bids for 70 oil blocks under Nelp-VIII​

10 Apr 2009,

NEW DELHI: The government on Thursday invited bids for 70 exploration blocks under the eighth round of New Exploration Licensing Policy
(Nelp-VIII). Domestic and global oil & gas exploration firms can submit their bids by August 10, petroleum secretary RS Pandey said. “We have offered 24 deepwater blocks, 28 shallow water blocks and 18 onland blocks under Nelp-VIII,” he said.

The ministry may also consider offering another 40-50 blocks in this round, if it gets better investor response. Oil ministry also announced the launch of 10 blocks under the fourth round of coal bed methane (CBM-IV) for extraction of gas from below coal fields.

Mr Pandey said that the global meltdown or volatility in global oil prices should not stop economic activities like exploration of oil and gas resources. “The most effective antidote for slowdown is generation of economic activities.

Besides, investors take a long-term view, while undertaking exploration activities,” he said. “Everyone knows that the current crisis will not last forever...By the time bids are finalised — which may take eight to nine months — things should improve,” he said.

Discoveries of oil and gas from Barmer and Krishna-Godavari basin have put India in global hydrocarbon map, he said. “Reliance Industries has recently started gas production from its KG-D6 block. This will also attract investors to Indian sedimentary basins,” he added. India had offered 57 blocks in Nelp-VII last year and awarded 44 to companies, such as BHP Billiton and Oil and Natural Gas Corp (ONGC). In the first six rounds, 162 blocks were awarded with an investment commitment of over $8 billion.

The 70 blocks offered under Nelp-VIII covers a sedimentary area of about 164,000 sq km. The 18 onland blocks are in Assam, Gujarat, Haryana, Madhya Pradesh, Manipur and West Bengal. Out of the 24 deepwater blocks, only one block has been offered in the KG basin, while 18 are located in Andaman. There are four blocks in the Kerala-Konkan areas, while one block is offered in the Mumbai deepwater. The 10 CBM blocks are located in states of Jharkhand, Orissa, Madhya Pradesh, Chattisgarh, Assam, Maharastra and Tamil Nadu.

 

[Screaming Skull]

OVL, Reliance, IOC in talks for $16-18 bn Venezuela project ​

NEW DELHI: Oil and Natural Gas Corp (ONGC), Reliance Industries and Indian Oil Corp (IOC), are coming together for the first time, to bid jointly for a vast oilfield in Venezuela, which will require an investment of $16-18 billion.

ONGC Videsh Ltd, the overseas arm of the state explorer, is talking to Reliance, IOC and Oil India for jointly bidding for a 40 per cent stake in a field in the vast Orinoco heavy crude oil belt.

“We are evaluating the three massive fields that are on offer and will decide on bidding shortly,'' a top OVL official said here. Fields in the Carabobo region of the Orinoco belt would produce tar-like oil, which would need to be upgraded to higher-qua lity synthetic crude.

Venezuelan state-run Petroleos de Venezuela SA (PdVSA) will retain the remaining 60 per cent. “he investment required is massive. The crude upgrade facility alone will cost $6-8 billion and so we are looking at partnership with other companies,'' he sai d. IOC may take a 2.5-5 per cent stake while OIL has been assigned a 2.5 per cent stake. The remaining 32.5-35 per cent will be split almost equally between OVL and Reliance. Each of the three fields on offer can produce 2 lakh to 4 lakh barrels of oil per day.

 

[NSG_BlackCats]

Car exports from India surge 57% in FY09​

NEW DELHI: At a time when global auto majors are struggling, carmakers in India have been able to expand their overseas presence with exports from
the country registering whopping 57.04% growth in the last fiscal.
According to the figures released by the Society of Indian Automobile Manufacturers (SIAM), passenger car exports from India touched 3,31,539 units in FY09 as against 2,11,112 units in the previous financial year.

The country's largest exporter, Hyundai Motor India, witnessed an export growth rate of 63% at 2,35,345 units compared with 1,44,440 units in the year-ago period.

Domestic market leader Maruti Suzuki India was a distant second, registering 32.58% growth in overseas sales at 68,834 units in 2008-09 as against 51,916 units in the previous fiscal.

Overall vehicle exports from India grew by 23.60% at 15,30,660 units in the last financial year, while the same stood at 12,38,333 units in the previous fiscal, SIAM said.

Exports growth in the last financial year was robust also in the two-wheeler category, which registered 22.50% rise at 10,04,174 units as against 8,19,713 units in the previous financial year.

 

[NSG_BlackCats]

Microsoft ties up with HCL to outsource jobs to India​

HOUSTON: Computer giant Microsoft has signed a USD 170-million five-year contract with India's HCL for outsourcing work for its online business
productivity suite. HCL will provide 600 employees to support the contract and nearly 250 workers have already begun work on the project.
Microsoft has not said whether this contract is to replace any existing agreement it has in India, or if this deal is an expansion of its current outsourcing scope.

Despite the recent job cuts, Microsoft has been expanding its online services business and has recently announced plans to make its Business Productivity Online Suite, a software-as-a-service offering, available for trial and purchase in 19 countries.

 

[Nihat]

Economy has bottomed out; see +ve IIP no in April: Expert


Guys , it's all very nice posting news about Indian Eco. but what might be even better is that only relatively Important news is posted , every single article on the net I can see over here , surely news about Wheat and Rice , Individual Company contracts etc etc does not need to be posted.

Lets keep this a MACRO thread which gives a broad based idea of were the Indian Economy is going and how it's taking shape vis-a-vis the global economy.

Sorry if I offend anyone.

 

[Screaming Skull]

Tatas, RIL, Infosys among world's 50 most innovative cos​

April 10, 2009

Three Indian entities -- Mukesh Ambani-led Reliance Industries, diversified conglomerate Tata Group and IT bellwether Infosys Technologies -- have entered BusinessWeek magazine's list of world's 50 most innovative companies, topped by iPhone maker Apple.

The league of innovative firms also features NRI Lakshmi Mittal-led world's largest steel producer ArcelorMittal.

Among the 50 companies, Tata Group ranks 13th, Reliance Industries 15th and Infosys 26th.

Tata Group and Reliance Industries have been ranked ahead of American industrial conglomerate General Electric (17), German car manufacturer BMW (20), Japanese auto firm Honda Motor (22) and telecom major AT&T (23), among others.

However, while the Tata Group slipped in ranking from the sixth place in 2008, Reliance Industries has improved on its previous year's 19th rank. Infosys was not in the list in 2008.

BusinessWeek has placed ArcelorMittal at the 35th spot.

Among the top five, Apple is followed by Internet search giant Google at the second position. Both companies have retained their respective ranks from last year.

Japanese auto maker Toyota Motor, software major Microsoft and Japan's Nintendo are at the third, fourth and fifth positions, respectively.

The rankings are based mostly on a Boston Consulting Group survey of about 2,700 senior executives worldwide.

'The final list weighted the survey results 80 per cent, stock returns 10 per cent, and three-year revenue and margin growth 5 per cent each. In the case of privately held companies, BusinessWeek used metrics equal to industry performance to compare financial data,' the magazine said.

About Tata Group, the magazine said, 'Tata can still dazzle, even if its takeovers since 2007 of steelmaker Corus and Jaguar Land Rover look ill-timed now. After making Asia's fastest supercomputer, the $85 billion company just launched a $2,000 minicar, the Nano.'

On Infosys, the report said of all of India's IT giants, Infosys 'has been the most conservative when it comes to acquisitions, giving it plenty of cash to spend now if it chooses.'

Writing about ArcelorMittal, the magazine said CEO Lakshmi Mittal blazed a trail as he assembled the first truly global steelmaker.

'But even a lean structure and low-cost mills aren't enough to offset a plunge in industrial output and steel prices,' it added.

 

[shrivatsa]

Report: India discovers huge oil and gas reserves


English_Xinhua 2009-04-10 15:39:01 Print

NEW DELHI, April 10 (Xinhua) -- Four new regions of north Indian state Haryana have been found to be abundant in gas and oil reserves, the local Hindi daily Danik Bhaskar reported on Friday.

Sedimentary studies in the area have revealed that 15 billion metric tones of gas reserves are likely to be present in the area. The government is now inviting Indian and foreign firms to hunt for gas reserves in Ambala, Yamunanagar, Kurukshetra and Panchkula, said the report.

The firms will be allowed to explore a 1,930 square-kilometer area for oil and gas exploration. The areas to be explored fall under the Himalayan foreland.

The Government expects to find good results on digging the area. V.K. Sibal, director general, Directorate General of Hydrocarbons, told the paper that the department has been studying the area for the last 10 years. It looks like Haryana has the potential to become a major hub for oil exploration in the country.

The tenders for exploration by new firms will be floated under the ongoing New Exploration and Licencing Policy, said the report.


Report: India discovers huge oil and gas reserves _English_Xinhua

 

[kallu_be]

Sedimentary studies in the area have revealed that 15 billion metric tones of gas reserves are likely to be present in the area. The government is now inviting Indian and foreign firms to hunt for gas reserves in Ambala, Yamunanagar, Kurukshetra and Panchkula, said the report.

15 billion metric tones > 600TCF ... whole report sounds fishy. If its real whole media has gone gaga over it by now.

 

[shrivatsa]

15 billion metric tones > 600TCF ... whole report sounds fishy. If its real whole media has gone gaga over it by now.

That's what i thought, Xinhua says dhainik baskhar reported it but i couldn't find any other report

 

[NSG_BlackCats]

NHAI infused Rs 20,000 cr in highways projects in FY'09​

NEW DELHI: The highways regulator has infused a whopping Rs 20,000 crore in various highways projects under NHDP in fiscal 2008-09, up 20 per cent
from the previous fiscal, at a time when the Indian economy reeled under the impact of the global economic slowdown.

"The National Highways Authority of India (NHAI) has infused Rs 20,000 crore in the National Highways Development Project (NHDP) in the last fiscal (2008-09)," an official said.

NHAI's expenditure during the fiscal 2007-08 had been about Rs 17,000 crore, he said.

"What is significant is that 60 per cent of the expenditure has been made in the last two quarters of the financial year 2008-09 despite the global economic slowdown. The expenditure was made in NHDP phases II and III projects," the official added.

The highways regulator is responsible for the development, maintenance and management of over 66,000 km of national highways in the country and is implementing NHDP.

NHDP phase II covers 6,647 km highways while phase III covers 8,074 kms.

The official said the expenditure was made in nearly 200 ongoing government-funded and PPP (public-private partnership) projects.

LINK

 

[NSG_BlackCats]

Tech Mahindra wins bid for Satyam Computers​

HYDERBAD: IT services provider Tech Mahindra is the new owner of Satyam Computer Services. The company bid the highest at Rs 58 per share, pipping Satyam Saga: Rise, fall and resurrection
rivals engineering firm Larsen & Toubro and billionaire investor Wilbur Ross to the post.

Engineering firm L&T bid at Rs 45.90 per Satyam share, Kiran Karnik, chairman of the govt constituted Satyam board told reporters.

Karnik also said that the Cognizant-Wilbur Ross combine had put in their bid at Rs 20/share for the fraud hit IT co.

Tech Mahindra will have to pay Rs 1,757 crore to buy a 31% stake in Satyam Computer Services. The IT co will have a market cap of Rs 5,666 crore on expanded equity. Tech Mahindra will have to pay a total of Rs 2890 crore for 51% stake in Satyam.

The acquisition will help the company, an arm of the Mahindra & Mahindra Group, to diversify into new areas instead of just depending on the telecom sector.

The Satyam acquisition will help Tech Mahindra diversify its software services business, and compete aggressively with bigger rivals such as TCS, IBM, Infosys and Wipro.

Satyam, which serves customers such as GE, GM and Ford will also help Tech Mahindra build a better portfolio of customers.

Satyam has a 46,600 strong work force, land assets of 450 crore, besides the order book position. Its liabilities include the legal liabilities arising out of the class action suits filed by shareholders in the US, besides any liability arising out of the tussle with UK based mobile payments services provider Upaid.