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India pays Iran EUR 2 billion in oil dues



Indian refiners have made payment of EUR 1.5 billion for crude bought from the National Iranian Oil Company, ending over 2 months of supply concerns after the RBI scrapped a regional money transfer mechanism.

Mr S Jaipal Reddy oil minister of India said that Pending dues are now being cleared and as of March 1st 2011 payment of EUR 1.5 billion has been made to the Central Bank of Iran.

Indian refiners buy 12 million barrels of crude every month form Iran which makes up about 12% of oil imports. Uncertainty over these supplies arose after the RBI scrapped the Asian Clearing Mechanism, an arrangement that allowed SAARC nations to do business with Iran that faces UN and U.S. sanctions.

Though Indian refiners could not pay for crude, Iran continued to supply crude in view of the long relationship with India. As a result, the outstanding had gone up to USD 4 billion.

The payments are being routed through the German central bank, Deutsche Bundesbank which has allowed payment in euro through EIH Bank. Refiners are certifying the oil they bought, which is then being vetted by the oil ministry. SBI is routing the payments from India and certifying the transactions.

Steel Guru : India pays Iran EUR 2 billion in oil dues - 194585 - 2011-03-07
 
India's engineering exports to touch $50 billion this fiscal news

NEW DELHI: India's engineering exports are likely to cross the USD 50 billion-mark by the end of this fiscal on the back of increasing demand in markets like North America , Africa and Middle East countries .

" India is a major exporter of light and heavy engineering goods and has a well-developed and diversified industrial machinery and capital base," Commerce and Industry Ministry Joint Secretary Sumanta Chaudhuri said in a statement here.

Engineering exports grew by 61 per cent to USD 38.80 billion during the April-December period this fiscal from USD 24.08 billion in the same period last year.

"Exports of engineering goods from India are likely to be over USD 50 billion in the current fiscal," Chaudhuri said.

Out of India's total engineering exports, valued at USD 32.5 billion in 2009-10, the US and EU accounted for about 65 per cent of the shipments.

The strategy paper of the Commerce Ministry has projected that the country's engineering exports will touch USD 108 billion by 2013-14.

In the engineering segment, India mainly exports industrial machinery, electric machinery and equipment, auto and auto components and ships, boats and floating structures.

To further boost the sector's exports, the government is organising trade fairs and business meetings. The Engineering Export Promotion Council (EEPC) and the ministry has jointly organised a buyer-seller Meet at the Indian Trade Promotion Organisation here today.

Over 40 delegates from the US, Canada, ASEAN and South Asian countries participated in the meet.
Engineering exports may cross $50 bn by fiscal-end: Com Min - The Economic Times
 
Indian stock market in a pickle as foreign funds flee

By Jamie Robertson
Presenter, BBC World News

Whatever happened to the Indian equity market?

Back in November, the Sensex squeezed past 21,000 for a day before starting a three month, 16% fall.

In the same time, the world's main indices, the FTSE Dow and Nikkei have all gained up to 7%, two of the remaining BRIC countries have fallen no more than 7%, and Russia's RTS Index has gained 26%.

Unsurprisingly foreign funds have been fleeing Indian equities in the last three months.

India is in a pickle and two reasons spring to mind - the stock market was heavily overvalued and the Central Bank has been raising interest rates.

At the end of the year the price of the average share on the Sensex was 23 times its earning power (ie its p/e ratio was 23 x). The Shanghai Index was 18 x, Brazil's Bovespa 14 x and Russia's just 9 x (the Dow's p/e was 13 x). That kind of valuation may be fine if future growth seems assured, but there are signs it may be falling off.

'Leg down'
GDP in real terms expanded at an annual rate of 8.2% in the last quarter - slowing from the 8.9% rate recorded in April to June. Now, this isn't a serious problem and no one is suggesting that the Indian growth story is in serious trouble, but it may be more than just a blip.

Maya Bhandari, senior economist at Lombard Street Research, says that, on a seasonally adjusted basis, growth was pretty much flat. She adds: "I would expect another leg down in the market in the coming few months."

Food inflation has been entrenched for some time, which means the Reserve Bank started putting up interest rates a year ago and has since hiked them seven times.

"In the last 25 months or so, we have had negative real interest rates and the central bank is going to have its work cut out to bring down inflation. And while it may be raising rates, the bank is holding more auctions and lowering the statutory liquidity levels for banks - all of which has inflationary consequences," says Ms Bhandari.

On top of domestic inflation pressures, the Middle East and North Africa crisis sent oil prices belting up above $100 a barrel, adding to the central bank's imperative to keep the upward pressure on rates.

Rate rises?
India is the world's the fourth largest oil importer and imports over 70% of its oil requirements. Oil prices, which will stay high for as long as the Arab crisis lasts, will damage India's economy more than most of its main rivals. At the moment, most economists are pencilling in another half to one percentage point rise in rates.

Oil is also going to hurt government finances. In his March budget, Finance Minister Pranab Mukherjee estimated that the deficit would fall from an estimated 5.1% of GDP in the year ending March 31, to 4.6% next fiscal year.

But if oil prices keep on going up, the government will have to decide whether to keep on paying out fuel subsidies or deregulate diesel prices.

Keeping the deficit under control would suggest the latter.

Five state elections in the next few months would suggest the former.

London-based India investment consultancy director Deepak Lalwani points out that foreign confidence in India has also not been helped by a slew of scandals, the biggest being allegations that the 2008 sale of second-generation, or 2G, cellular licenses resulted in losses of nearly $36bn in potential revenue for the government.

But, he says: "All the local businessmen will tell you India continues to grow despite all the problems with the government. That is the strength of the India growth story."

Foreign retail
The government is trying, somewhat half-heartedly, to be proactive.

The budget did make some gestures towards reform, increasing the cap on the amount of money Indian companies can borrow offshore and allowing foreign retail investors to buy into domestic mutual funds.

Mr Mukherjee also promised to raise $8.8bn from selling stakes in state run companies next year (he missed his privatisation target last year) and so far the $2.7bn Oil and Natural Gas Company (ONGC) 5% share sale is still slated for mid-March, though there are rumours it may be delayed a week or two.

But Mr Lalwani points out that the government is still reluctant to open the agricultural sector to foreign investment.

"That is where the real problem is in the food inflation - in the malaise in agriculture, the inadequate funding, the lack of irrigation, the cold storage, roads and so on, all of which push up prices and are a tax on the poor."

He pointed out that the Indian equity markets have recovered all their losses from the 2008 collapse, and are quite capable of staging a recovery from this relatively minor sell-off.

The World Bank is now forecasting that Indian growth will be faster than China's in 2012.

It's perfectly possible - it's just that there may be a number of upsets on the way.

BBC News - Indian stock market in a pickle as foreign funds flee
 
India likely to see normal monsoon in 2011: Officials


NEW DELHI: India's south-west monsoon is likely to be normal for the second straight year in 2011, weather officials said on Monday, raising hopes of higher farm output that could help the government tame high food prices.

The monsoon acts as a lifeline for India's farm-dependent economy, which is also the world's leading producer and consumer of several key commodities such as sugar, grains, oilseeds and cooking oils.

"There is no abnormal global signals in the weather system to hint that there could be a drought this year," D. Sivananda Pai, director at the state-run National Climate Center , told Reuters.

Pai said a La Nina weather pattern, which causes heavier-than-normal rains in South Asia, still prevails over 25 percent of the country and is expected to remain active till May, just before the start of the June-Spetember monsoon season.

Another senior official said weather models of the Indian weather office ruled out chances of occurrence of El Nino that causes drought conditions in the Indian sub-continent.

"Our statistical models do not forecast a bad monsoon for 2011," the government official said without wanting to be named.

India's main weather office will come out with its first forecast on this year's monsoon season in April with periodic reviews as the four-month season progresses.

The government in Asia's third-largest economy is struggling to control double-digit food inflation, among the highest in the region, and a good monsoon is seen as crucial for higher farm output needed to cool prices.

Prime Minister Manmohan Singh , whose Congress party faces several important state elections this year, has said fighting inflation is a priority and last month's federal budget has spelt out steps to help boost farm output.

India likely to see normal monsoon in 2011: Officials - The Economic Times
 
So in 2-3 years we will be 6th in the world by nominal GDP and 4th in 4-5 years.

That is if the trend of doubling of GDP every 4-5 years holds. It held for China.
 
BTW, if we go back to the Goldman Sachs BRIC report, both India and China are doing far better than it predicted. The global balance of power is shifting faster than predicted.

We will likely achieve in 2011 what was predicted only by 2015. By 2015-16, we will likely be the 5th largest economy and 4th largest 2-3 years after that.

In a decade, our poverty may fall to single digits that can be much more easily supported with the resources available.

Now if only governance can keep pace, every Indian will finally have the opportunity he/she deserves.
 
So in 2-3 years we will be 6th in the world by nominal GDP and 4th in 4-5 years.

That is if the trend of doubling of GDP every 4-5 years holds. It held for China.

In three years 5th and in five years 4th. We have doubled the GDP in five years 2007-2012 though affected by financial crisis.

If I am not wrong in terms of PPP we will third largest economy after US and China in the fiscal 2011/12.
 
^^ Yes. The focus will shift intensely to governance now. Even our useless politicians can't shirk it much longer.

They will have to move their fat arses or get kicked out.
 
^^ Yes. The focus will shift intensely to governance now. Even our useless politicians can't shirk it much longer.

They will have to move their fat arses or get kicked out.

Good governance is the main thing India lacks!!!! If it were there than we could have been much ahead by now. See recent scams by the politicians and corporates had significant affects on India's image and economy but nothing will change in future. Many have lost faith in these politicians but still India developing fast. Praise to all hard working people of our country.

Three persons can change India's policy significantly but they will not.... Sonia, Manmohan and Pranab. These three holds the key.
 
Coal India to get Environment Ministry's clearance for 7 projects soon

MUMBAI: Coal India would soon get clearance from environment ministry to start work on 7 projects. Sources close to the management and the ministry believe that projects located in Bokaro, Raniganj & Rajmahal coal fields would be first one to get clearance from the ministry.

Some of the projects located in coal field falling in the ambit of CEPI-namely Dhanbad and Chandrapur might also be considered for clearance. Sources also say that Environment appraisal committee will meet soon for clearing these projects Bokaro, Raniganj and Rajmahal coal fields together own about 19 per cent of Coal India's estimated coal reserves. Bokaro owns 5000 million tonne of total reserves gross and 3500 million tonne of proven coal reserves.

Raniganj coal field houses 9177 million tonne of total gross reserves and about 7483 million tonne have been identified as proven reserves. Rajmahal coal field boasts of 3300 million tonne of total reserves while proven ones stand at 1250 million tones.

Analysts assuming delay in the clearances and not upping the volume growth assumptions in the model may have to revise their estimates upwards for Coal India' production targets.

Coal India to get Environment Ministry's clearance for 7 projects soon - The Economic Times
 
Kudankulam reactor commissioning in April

The hot run will start in a few days, says NPCIL Chairman and Managing Director

“Everything is on course” for the enriched uranium fuel bundles to be loaded into the first reactor of the Kudankulam Nuclear Power Project (KKNPP), Tamil Nadu, by the end of March and the reactor will be started up in April. “That is the target today,” said S.K. Jain, Chairman and Managing Director, Nuclear Power Corporation of India Limited (NPCIL).

“The hot run of the reactor will start in a few days. All the systems have already been individually commissioned. Some of the systems were commissioned in an integrated fashion when the cold run was done. Although this VVER-1000 reactor from Russia is the first-of-its-kind to be built in India, we have not come across any problem in the individual commissioning of the systems,” said Mr. Jain.

Control rods, numbering 121, have been successfully installed and tested. The control rods help in shutting down the reactor in case of an incident/accident. After the hot run of the reactor is completed, actual fuel bundles will be loaded into the first unit. The reactor now has dummy fuel bundles.

Two pressurised water reactors from Russia, each with a capacity of 1,000 MWe, have been built at Kudankulam by the NPCIL. The reactors use enriched uranium as fuel, and light (ordinary) water as both coolant and moderator. The NPCIL will operate the reactors.

Asked what a hot run entailed, the NPCIL Chairman said the reactor was practically ready for commissioning now. Before the real fuel bundles are loaded into the reactor, “we will run all the systems in an integrated manner at the operating temperature as if we are operating the plant,” Mr. Jain explained.

The only difference is that the reactor will have dummy fuel bundles in the hot run instead of actual fuel assemblies. Impurities in the system will be removed. Borated water will be circulated through the systems, which will be later drained of the water and dried. (Water mixed with boric acid is called borated water). Then the dummy fuel bundles will be removed and actual fuel assemblies loaded into the reactor.

M. Kasinath Balaji, Site Director, KKNPP, said, “We will keep the systems operating at normal operating temperature with the dummy fuel loaded into the reactor vessel. We will do safety tests and other elaborate tests. It is called hot run.” The vertical reactor vessel had 163 fuel assemblies, Mr. Balaji added.

Mr. Jain said the run-up to the criticality and the criticality itself of the pressurised heavy water reactors (PHWRs) operating in India were totally different from the Kudankulam reactors, which are pressurised water reactors.

The first consignment of light enriched uranium fuel for unit-1 of the KKNPP arrived at the site on May 25, 2008. This kind of fuel is in use in VVER-1000 MWe units in several countries since 1980s. The life-time fuel supply for the Kudankulam reactors is covered by a sovereign guarantee of the Russian Federation.

The Hindu : News / National : Kudankulam reactor commissioning in April
 
Tax demand on Hasan Ali and associates pegged at Rs 71,845 crore:hitwall:

NEW DELHI: What exactly is the tax demand on Hasan Ali Khan and his associates? For a while, a figure of Rs 40,000 crore has been doing the rounds, though some tax officials were questioning the veracity of this amount. However, the income-tax department is now learnt to have raised a demand of Rs 71,845 crore.

This figure — which is larger than the country's health budget and its annual service tax collections — includes a demand of Rs 50,329 crore on Khan himself, Rs 49 crore on his wife, Rheema; Rs 591 crore on his alleged associate Kashi Nath Tapuriah and Rs 20,540 crore on his wife, Chandrika Tapuriah, revealed I-T department sources

Of the total tax demand of Rs 71,845 crore, the I-T department has adjusted only Rs 60 lakh which was recovered from raids on Khan and the Tapuriahs. The appeal is now pending before the Income Tax Appellate Tribunal. Even the Comptroller & Auditor General is learnt to be looking into the issue.

Although investigations have been on since 2007, tax authorities were not really seen to be pushing the case till the Supreme Court turned up the heat. Interestingly, the Centre had filed an affidavit in the Supreme Court in 2009 itself stating that the I-T department had raised a demand of Rs 71,848.59 crore against Khan, his wife Rheema and other associates (reported by TOI in a front-page article, 'Pune man holds secret billions' on May 3, 2009).

Government officials, however, said the recent demand was made following information collected by them from a pen drive and laptop recovered during raids on Hasan Ali and the Tapuriahs. They further said the scope of the probe has been widened to include at least six more countries, which may further push up the demand on Khan. The I-T department is investigating Khan's investment links in these countries.

At nearly Rs 72,000 crore, the tax demand is nearly half the amount locked up in all tax disputes (direct and indirect), which were estimated at Rs 1.43 lakh crore at the end of March 2010 — not including the demand on Khan.

The amount is more than what is being spent on food subsidy (Rs 60,000 crore), primary and secondary education (Rs 63,300 crore) or even the health ministry's budget (Rs 30,456 crore) in 2011-12. If the government manages to realize the amount from Khan and his associates, which officials admit is a remote possibility, it would be marginally higher than the Rs 69,400 crore that the government hopes to collect as service tax during the current financial year.

Tax demand on Hasan Ali and associates pegged at Rs 71,845 crore - The Times of India
 
Here I am slogging my @$$ to earn enough to meet the ends for my family and these hundreds of Hasan ALIs are being protected by a government whom i did not even vote for. yet my fate is being dictated by these corrupt B@$*@rd$ .. I would welcome any other Party in center but Congress..
 
Exports cross $200 bn mark in Feb

India's exports crossed the USD 200 billion mark in the first eleven months of the 2010-11 fiscal, driven by a 50 per cent jump in outward shipments in February on the back of rising demand from the US and other markets.

Exports jumped by 49.8 per cent year-on-year during February to USD 23.6 billion, taking the April-January, 2010-11, figure to USD 208.2 billion, an increase of 31.4 per cent over the year-ago period and past the yearly target of USD 200 billion.

"We have crossed the USD 200 billion mark. The current forecast for the (fiscal) year is USD 230-235 billion," Commerce Secretary Rahul Khullar said.

Imports also went up by 21.2 per cent in February to USD 31.7 billion, leaving a trade deficit to USD 8.1 billion.

During the first 11 months of the financial year, imports grew by 18 per cent to USD 305.3 billion vis-a-vis the same period last year. The trade gap for the period stood at USD 97.1 billion.

"In imports, we will end up (the fiscal) closer to USD 350 billion... On the whole, we are looking at balance of trade at USD 105-115 billion," he said, adding, "(It depends) on how well or bad we do on the export and import fronts." However, the Secretary said that the import figures will change as they will be revised once definitive figures are formulated.

He also said that export numbers for January and February from special economic zones are also coming in, so "by the end of March when I will give you the full year numbers, you should not be surprised if there is a bump up in the exports numbers."

Khullar further said that the sectors which performed well during the 11 months of fiscal include engineering (81 per cent), petroleum and oil lubricants (34 per cent), cotton yarn and made-ups (43 per cent), plastics (41 per cent), chemicals (22 per cent), electronics (40 per cent), carpets (37 per cent) and marine (20 per cent).

"The growth which we are seeing is basically from the markets of Asia, Latin America and Africa. In these new markets demand for our products are increasing," Ramu Deora, the President of India's apex exporters body FIEO, said.

However, Deora said that demand is still weak in several European markets.

The US and Europe were the traditional markets for Indian exporters, but after the global economic crisis, exporters increased their engagement in new markets of Asia, Latin America and Africa.

The government is providing duty incentives to exporters for these new markets.

Exports cross $200 bn mark in Feb
 
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