Bengal find spurs cheap gas hope
India's per capita income up 14.5% to Rs 46,492,whose Income?
Fast track court convicts 12 in Kandhamal riots case!
INS Vindhyagiri on fire post collision, many feared stuck! Pak has 110 N-weapons to edge ahead of India: US Report
US justifies use of trackers on Indian students duped by TVU
Indian Holocaust My Father`s Life and Time -FIVE HUNDRED SEVENTY EIGHT
Conditional green clearance for Posco!After putting the project on hold last year, Union Environment Minister Jairam Ramesh today granted conditional clearance for South Korean major Posco''s USD 12 billion steel mill project in Orissa.
The approval enables the Orissa government to immediately start acquiring land for POSCO.
The Ministry, while granting conditional green clearance for steel-cum-captive-power plant and a captive minor port, however, sought Orissa Government''s assurances before it can give final approval for diversion of 1253 hectares of forest land for the project, mooted as the single biggest foreign direct investment in India.
"Environmental clearance for the steel-cum-captive power plant is being accorded with 28 additional conditions over and above stipulated in the original environmental clearance of July 19, 2007," Ramesh said in his order.
"The environmental clearance for captive port is being accorded with 32 additional conditions over and above stipulated in the original environmental clearance of May 15, 2007," the order signed by the Minister said.
Govt approves $12 bln POSCO steel mill!POSCO says Indian approval boosts its global strategy! The DRama enacted by Proactivist Environment Minister Jairam ramesh is over asIndia's environment ministry approved on Monday South Korean POSCO's plans for a $12 billion steel mill, a boost for the foreign investment climate after several setbacks for big ticket industrial projects.Now just wait for the Sardar sarovar Project of the South , POLAVARAM Dam Project to be approved violating Forest act and Disloding thousnada of tribal families, INUNDATING Aboriginal Humanscape in Orissa, Chhattishgarh, MP, Maharashtra and Andhra!The long-delayed clearance for India's biggest foreign direct investment -- as long as the company meets a series of environmental standards -- follows a year in which Environment Minister Jairam Ramesh has blocked several projects, raising criticism he was jeapordising India's growth story.India's decision on Monday to approve construction of a $12 billion steel mill by South Korea 's POSCO will help the world's No.3 steelmaker raise exports and gain access to low-cost iron ore, analysts said.Along with the world's top steelmaker ArcelorMittal and Nippon Steel Corp, POSCO is eyeing a footprint in India's high-growth market, with global demand expected to slow as mature economies continue to struggle to recover from the economic downturn.Asian mills are also attracted to India's rich iron ore deposits, the world's third-largest, as they seek to reduce their reliance on Australia and Brazil and the associated freight costs of shipping the steelmaking ingredient.
Emerging market companies buy up the world as BSE Sensex records worst monthly fall in over 2 years.The BSE Sensex on Monday posted its worst monthly fall in more than two years, tracking weak global markets as anti-government protests in Egypt led to risk aversion, with inflation and rate rise fears further dampening sentiment.The 30-share BSE index shed 0.4 percent on Monday leading to a 10.6 percent fall in the month, its lowest since October 2008.There's a new swagger among the bosses of emerging market companies as they sign cheques for a growing list of acquisitions in both the developed and developing world. And this is just the start.After suffering less in the downturn and rebounding faster than their U.S. and European counterparts, corporations from China to Mexico are taking advantage of their strength to go shopping for an ambitious range of businesses.
Consumer firms eye Africa as next growth driver! Indian consumer goods makers are scrambling to buy assets in Africa, applying their knowledge of challenging, lower-income markets to a continent where spending power is on the rise.Tapping Africa opens up new growth avenues for cash-rich Indian makers of personal care products such as soaps, shampoos, hair and skin care products, with rising costs and fierce competition squeezing profits at home.
|Bengal find spurs cheap gas hope|
New Delhi, Jan. 30: Shale gas found in Durgapur is expected to cost the user $2 per million British thermal unit (mBtu), which is much lower than natural gas and coal-bed methane and can change the pricing norms for the gas industry.
"The shale gas production is expected to cost around $2 per mBtu compared with $4.2 per mBtu for natural gas and coal-bed methane," D.K. Pande, director for exploration of ONGC, said.
In the US, shale gas has significantly reduced the country's dependence on LNG. In India, too, the gas can help to strengthen the country's energy security and set new pricing standards.
Gas prices vary depending on the source. For instance, gas sourced from the KG basin block operated by Reliance Industries is sold at $4.20 per mBtu, while gas from the Panna, Mukta and Tapti fields run by British Gas is priced at $5.73 per mBtu.
Companies pay $5.50 per mBtu for gas from Cairn India's Ravva field in Andhra Pradesh. Gas from ONGC's C-series field is priced at $5.25 per mBtu.
Firms have to pay more than $10 per mBtu for imported LNG.
ONGC has tapped shale gas from a 2,000-metre well at Icchapur village near Durgapur in Bengal's Burdwan district — the first in the country. "The breakthrough is significant as India is the first Asian country where gas has been discovered from shale besides the US and Canada," Pande said.
ONGC will soon start studying the commercial viability of the gas along with the environmental impact on production.
"Apart from the issues of land, there are concerns over the environmental impact which will be studied before we seek permission of the government for the commercial exploitation of shale gas," Pande said.
Shale gas production requires large tracts of land as it involves horizontal drilling. Shale gas is natural gas, or methane, trapped in layers of hard rocks called shale that are found thousands of metres below the earth's surface. A process known as hydraulic fracturing, or "fracking", is used in the extraction, under which water mixed with chemicals are blasted into a well to break the rocks and release the gas.
There are concerns that this technology can have negative impacts on the environment such as groundwater contamination and air pollution.
A report by Washington-based World Watch Institute says "a robust regulatory oversight is an important ingredient to assure environmental and public protection" if any country wants to exploit shale gas.
According to the report, chemicals used in fracking could seep into the surrounding groundwater and cause serious health problems. Safe disposal of huge volumes of waste water and loss of green space are the other concerns.
India has signed a shale gas pact with the US to assess the resource available at home and prepare for the auctioning of gas blocks.
The petroleum ministry is expected to consult the environmental ministry before putting the blocks on sale.
India plans to auction its first shale gas block by the end of this year.
According to preliminary estimates, shale gas reserves may be larger than proven conventional gas deposits. India has reserves of 1,074 billion cubic metres of natural gas, according to the oil ministry.
Several basins in India are known to hold the gas. The focus is on three basins — Cambay (Gujarat), Assam-Arakan (Northeast) and Gondwana (central India).
The government plans to come out with policies and a production sharing mechanism, including the sharing of profits with state governments, before the first round of blocks are auctioned, officials said.
US justifies use of trackers on Indian students duped by TVU
The US today sought to justify the use of ankle monitors on the students, duped by now closed Tri-Valley University, saying it was widespread across America as a standard procedure for a variety of investigations and does not necessarily imply guilt or suspicion of criminal activity.
The US response followed a sharp reaction by Indian government which termed the use of trackers as "unacceptable" and demanded their removal.
After being duped by a California-based "sham" university, scores of Indian students in the US were forced to wear radio collars around their ankles so that authorities can keep track of their movements.
"US Immigration and Customs Enforcement (ICE) have established a helpline for the Indian students affected by the closure of Tri-Valley University in California, under which any affected student may call to seek help. Some of those involved in the Tri-Valley investigation have been issued ankle monitors.
"Use of ankle monitors is widespread across the United States and standard procedure for a variety of investigations, and does not necessarily imply guilt or suspicion of criminal activity. An ankle monitor sends a radio frequency signal containing location and other information to a receiver. It allows for freedom of movement and is a positive alternative to confinement during a pending investigation," the US Embassy here said in a statement.
It said the the US government welcomes all legitimate students wishing to study there and strongly encourages prospective students to protect themselves from predatory visa fraud rings and fraudulent document vendors.
The US-India Educational Foundation provides college information and counseling services to students across India and consular officers hold frequent seminars on the proper way to apply for a student visa, including how to guard against visa fraud.
"We encourage all students to use these resources to ensure that they are enrolling in registered and accredited programs that are appropriate for their means and needs," the statement added.
The US State Department also cooperates extensively with Indian government to identify and shut down visa fraud rings and encourage Indian government to further support local police forces in these investigations.
"Visa fraud is not a victim-less crime and fraud agents and fake document vendors target some of the most vulnerable and impoverished members of Indian society. Fraud hinders genuine students from studying in the US and causes opportunities and resources to be taken away from legitimate applicants.
However, victims of fraud do have access to a variety of federal and state resources in the US- at minimum, each US state has victims' assistance units to aid victims of crime, and a legitimate student who is a fraud victim should have little trouble re-applying and enrolling in a different, fully-accredited educational organization.
"The Department of State takes allegations of immigration and visa fraud very seriously and the Tri-Valley University fraud allegations are an excellent example of the universally damaging effects of visa fraud," it added.
India's per capita income up 14.5% to Rs 46,492,Whose Income?
Per capita income of Indians grew by 14.5 per cent to Rs 46,492 in 2009-10 from Rs 40,605 in the year-ago period, as per the revised data released by the government today.
The new per capita income figure estimates on current market prices is over Rs 2,000 more than the previous estimate of Rs 44,345 calculated by the Central Statistical Organisation.
Per capita income means earnings of each Indian if the national income is evenly divided among the country's population at 117 crore.
However, the increase in per capita income was only about 6 per cent in 2009-10 if it is calculated on the prices of 2004-05 prices, which is a better way of comparison and broadly factors inflation.
Per capita income (at 2004-05 prices) stood at Rs 33,731 in FY10 against Rs 31,801 in the previous year, the latest data on national income said.
The size of the economy at current prices rose to Rs 61,33,230 crore in the last fiscal, up 16.1 per cent over Rs 52,82,086 crore in FY'09.
Based on 2004-05 prices, the Indian economy expanded by 8 per cent during the fiscal ended March 2010. This is higher than 6.8 per cent growth in fiscal 2008-09.
The country's population increased to 117 crore at the end of March 2010, from 115.4 crore in fiscal 2008-09.
RBI blames Ramesh's 'environment sensitive policies' for FDI dip
The Reserve Bank of India (RBI) has blamed Minister of State for Environment and Forests Jairam Ramesh's 'environment sensitive policies' for driving away Foreign Direct Investments (FDI) from the country.
At least this is what the Reserve Bank of India suggests - in its quarterly review of economy released on Monday -as one of the key factors affecting 'investors' sentiment', The Indian Express reports.
The RBI records an "almost 36 per cent" dip in inward FDI during the first half of the current fiscal (April-September 2010).
In its report, the apex bank points out that inward FDI during this period stood at only about 12.6 billion dollars as against 19.8 billion dollars inward flow witnessed during the same period in the last fiscal.
It was not a global phenomenon is borne out of the fact that FDI inflow into other emerging economies during the same period was up in the range of 6-53 per cent. (ANI)
31 JAN, 2011, 02.10AM IST, URMI A GOSWAMI,ET BUREAU
Implement forest Act in Polavaram project area, Centre asks AP
NEW DELHI: Andhra Pradesh Chief Minister N Kiran Kumar Reddy has been asked to look into complaints about the non-implementation of the Forest Rights Act in the Polavaram project area . Environment Minister Jairam Ramesh had written to Kiran Kumar's predecessor K Rosaiah in November. The lack of response from the state government prompted Ramesh to send a reminder last week.
Ramesh's reminder comes at a time when former Congress MP from Kadapa Jaganmohan Reddy has announced plans to undertake a three-day march from February 7 demanding speedy execution of multi-purpose dam and irrigation Polavaram project.
The project will bring immense benefit to farmers in the West Godavari, East Godavari, Krishna and Vizag districts as well as ensure water supply for Vizag. This would explain the push by Jaganmohan Reddy and Prajarajya Chief Chiranjeevi for the Polavaram project. No benefit will accrue to the Telangana region from this project, instead last tracts of Telangana will be submerged. Political parties across the spectrum in Telangana have opposed the project. The central government would like to tread carefully on the issue given the contentious Telangana issue.
Nearly 250 villages will be affected by the project, and almost 200,000 persons are expected to be displaced by the project. Most of the population in the area is tribal. This makes the non-implementation of the crucial forest rights law an extremely serious problem. Environmental analysts describe the Polavaram project as the "Sardar Sarovar of the south."
The first set of complaints were sent to Ramesh in end August. In their complaints, the gram sabhas challenged the state government's assertion that all claims under the Forest Rights Act have been settled. This was followed by complaints by civil society representatives to Forest Advisory Committee in September. The matter was referred to the Forest Advisory Committee.
Fast track court convicts 12 in Kandhamal riots case
PHULBANI (ORISSA): Two separate fast track courts here sentenced 12 people to rigorous imprisonment and penalty after convicting them in cases of house burning during the Kandhamal riot in 2008.
While disposing a case relating to house burning of minorities at Lengisuga village under Baliguda police station area during the riot, the fast track court judge C R Das pronounced four years RI and Rs 3,000 penalty to 10 persons of the same village and acquitted four others due to lack of proper evidence.
Similarly, the fast track court-I judge S K Das pronounced three years RI and Rs 3,000 penalty to two persons after finding them guilty in setting fire on the houses of minorities at Ghodabisa village under G Udaygiri police station area.
Both the house burning cases were reported on August 27, 2008, barely four days after killing of the VHP leader Swami Laxamananda Saraswati.
Above 4,000 houses were burnt and 38 people killed in the Kandhamal riot in the aftermath of Saraswati's killing.
INS Vindhyagiri on fire post collision, many feared stuck
MUMBAI: Frantic efforts were on Monday to save Indian Navy warship INS Vindhyagiri after a major fire engulfed it following a collision with a merchant vessel off Mumbai Harbour, official sources said here.
The warship of the Nilgiri class had collided with the container vessel MV Nordlake around 5 p.m. Sunday but there were no casualties.
The naval fire brigade was assisted by the Mumbai Fire Brigade in dousing the fire, which apparently started in the engine room when it was brought to the naval dockyard for assessing the damage, the sources said, adding that possibilities of saving the warship seemed bleak.
An official defence spokesperson confirmed the fire on board the warship but declined to give further details.
While the naval frigate was entering the Mumbai Harbour after celebrating "a day at sea" with naval personnel and their families, the MV Nordlake, loaded with containers, was navigating out of the harbour.
The collision took place in the main navigation channel used by all vessels to enter both Mumbai Port Trust and Jawaharlal Nehru Port Trust .
Though there were no casualties or oil spill after the collision, the container ship was detained for further investigations.
Vindhyagiri is a 3,000-tonne, 20-year-old frigate commissioned in the navy in 1981.
Pak has 110 N-weapons to edge ahead of India: US Report
WASHINGTON: Pakistan has doubled its nuclear arms stockpile to 110 warheads, developing new weapons to deliver them and significantly accelerating production of uranium and plutonium for bombs to edge ahead of India.
Islamabad's nuclear weapons stockpile now totals more than 110 deployed weapons in a sharp jump from an estimated 30-80 weapons fours years ago, 'Washington Post' reported.
"Pakistan has expanded its nuclear weapons production capability rapidly", the Post quoted David Albright President of the Institute for Science and International Security as saying.
Albright said that based on accelerated production of plutonium and highly enriched uranium, Pakistan may now have an arsenal upto 110 weapons.
The non-government US analyst said that while continuing to produce weapons-grade uranium at two sites, Islamabad has sharply increased its production of plutonium, enabling it to make lighter warheads for more mobile delivery system.
Pakistan's has developed a new missile Shaheen II, with a range of 1,500 miles which is about to go into operation deployment. The country has also developed nuclear capable land and air launched cruise missiles, the Institute said in a new report.
"The Pakistanis have significantly accelerated production of uranium and plutonium for bombs and developed new weapons to deliver them. After years of approximate weapons parity, experts said, Pakistan has now edged ahead of India, its nuclear-armed rival", Washington Post said.
The paper said while Pakistan has produced more nuclear-armed weapons, India is believed to have larger existing stockpiles of such fissile material for future weapons.
Dubbing Pakistan as one of the world's most unstable region, Post said an escalation of nuclear arms race in South Asia possess a dilemma for Obama Administration.
It said in politically fragile Pakistan, the Administration is caught between fears of proliferation or possible terrorist attempts to seize nuclear materials and Pakistani suspicions that the US aims to control or limit its weapons programme and favours India.
Quoting Pakistan's Defense attache at its embassy in Washington, Post said the number of Pakistani nuclear weapons are heavily deployed near its border with India.
The paper said that in December 2008, Peter Lavoie, US national intelligence officer for South Asia, told NATO officials that "despite pending economic catastrophe, Pakistan is producing nuclear weapons at a faster rate than in any other country in the world".
"Undoubtedly projects such as that of POSCO have considerable economic, technological and strategic significance for the country," the statement said. "At the same time, laws on environment and forests must be implemented seriously."
The mill in Orissa has been delayed by criticism it would ruin lives of thousands of poverty-stricken people, who say the plant will disrupt their betel leaf plantations and forest-based livelihoods.
India, one of the world's fastest growing major economies, needs foreign capital to boost infrastructure and allow its economy to grow at near double digits. But projects have met with protests from local farmers in this densely-populated country.
A government panel had earlier said there were no ecological concerns over the plant and the final decision was with Ramesh.
Posco is among several corporations, including Vedanta Resources, which have come under scrutiny from Ramesh, putting his ministry in conflict with others in the government who are pushing for rapid industrialisation.
A series of corruption scandals has shaken the government of Prime Minister Manmohan Singh and a recent minor cabinet reshuffle saw several ministers' portfolios change, but Ramesh stayed on as environment minister, indicating his influence.
The ruling Congress party head, Sonia Gandhi, is keen to win over farmers hit by big projects at well as ensuring industrial jobs are created -- a fine line that may have helped create regulatory uncertainty before state elections this year and a general election in 2014.
While investors tend to shrug off corruption scandals as a risk of emerging markets, regulatory uncertainty threatens to taint India's attractiveness as a destination for foreign firms eager for a slice of its booming $1.3 trillion economy.
In October, Ramesh threw out plans by London-listed Vedanta to expand its alumina refinery over worries it would destroy a "sacred" hill for tribal peoples, but this month Ramesh said he was willing to conditionally reconsider Vedanta's expansion plan.
That remark came soon after the ministry said it could consider approving Hindustan Construction Co's ambitious Lavasa project, a massive new town in a forested area near the city of Pune being built at a cost of $31 billion.
A back-and-forth on whether to ban iron ore exports in Karnataka has also worried investors. ArcelorMittal, the world's top steel maker, has also had faced years of delays in building several plants in India.
Approval for the Posco mill would see the Orissa government immediately starting to acquire land for the world's third-largest steelmaker's project.
Posco still faces a series of hurdles that could delay the project, such as a court case filed by a local firm against the Orissa government, contesting its decision to grant a mining concession to South Koreans.
India, which has not yet been able to exploit its potential as a natural resources-rich country, is keen on boosting its trade and political ties with South Korea while Seoul looks to tap into the $150 billion Indian nuclear power market.
Direct investors -- companies building factories or power plants or buying local firms -- often have less flexibility and more to lose than fund investors and are especially sensitive to regulatory uncertainty.
Leading global companies such as Wal-Mart Stores, Vodafone and POSCO have been frustrated for years in their efforts to negotiate regulations in a promising but perilous market, and foreign direct investment has suffered.
Vodafone, India's biggest foreign direct investor to date, is fighting a 120 billion rupee ($2.6 billion) tax bill in a court battle and has complained about a telecoms regulatory structure that it said allowed too many players into the market.
"The biggest attraction of India for global steelmakers is its strong growth potential and its iron ore reserves," said Hana Daetoo Securities analyst Kim Jung-wook.
POSCO's 12-million-tonne steel project, first announced in 2005, is the centerpiece of its bid to expand overseas amid rising domestic competition and as it seeks to increase self-sufficiency in sourcing steelmaking ingredients. POSCO currently sources most of its iron ore from Australia and Brazil.
Domestic rival Hyundai Steel Co is boosting output aggressively to increase supply for affiliate Hyundai Motor Group, the world's No.5 auto group that includes Hyundai Motor Co, and a major client of POSCO.
The approval enables the Orissa government to immediately start acquiring land for POSCO.
"We welcome the decision by India's environment ministry. We will proceed with stalled steps such as land acquisitions," a POSCO spoeksperson said.
But POSCO still has a long way to go to complete the Orissa project, since it has yet to receive a separate court ruling on iron ore mining rights from India. POSCO expects that to be decided by the first half of 2012 in order for construction to start later that year.
An Indian company that also bid for the mining concession has filed a lawsuit against the Orissa government, contesting the decision to grant a concession to the South Korean steelmaker.
"With the decision POSCO has cleared a major hurdle for its overseas expansion, but the most important part is gaining mining rights. Without mining rights, there's no strong merit for POSCO to build a steel plant in India," said Kim at Hana.
The project has been delayed by environmental issues and protests by local residents, who say the plant will disrupt their largely agricultural and forest-based livelihoods.
Steel companies are rushing to invest in India to tap the country's rich iron ore deposits, but have faced a series of obstacles such as land acquisition problems, environmental clearance and regulatory issues.
ArcelorMittal has announced plans to set up plants in India, but has so far been unable to acquire land.
Demand for steel in India is expected to rise 14 percent this year, outpacing the 5.3 percent global growth rate, fuelled by surging construction of buildings and infrastructure and massive investments by global carmakers, according to the World Steel Association.
POSCO is among several corporations, including Vedanta Resources Plc, to have come under the scrutiny of India's environment ministry, putting the department in conflict with others in the government who are pushing for rapid industrialisation.
In October, Ramesh threw out plans by London-listed Vedanta to expand its alumina refinery over environmental concerns, but this week Ramesh said he was willing to conditionally reconsider Vedanta's expansion plan.
Ramesh has described POSCO's project as "fundamentally different" from Vedanta's plans.
"There is a lot of concern in the market about food security, oil prices," said Arun Kejriwal, director of research firm KRIS.
"Most certainly a dead cat bounce is overdue, but I am not sure if that will make a difference to the direction of the market."
Telecoms stocks ended lower on India's plan to de-link second-generation radio (2G) spectrum that now comes free with telecoms licences and ask companies to pay for spectrum based on market-linked prices.
Bharti Airtel ended 2.6 percent lower, while Reliance Communications shed 2 percent. Idea Cellular closed 0.8 percent lower.
The top two software firms Tata Consultancy Services and Infosys Technologies were among the top losers, falling 2.2 percent and 1.8 percent respectively, on growing uncertainty about the outsourcing business momentum.
Emerging markets are, more than ever, a key topic at the annual meeting of the World Economic Forum in Switzerland. Traditionally, most focus has been on Western firms buying assets in fast-growing developing economies, to hedge against sluggish growth at home.
But it is a two-way street and, increasingly, emerging market firms are shopping in the developed world as they move up the value chain and pursue their own diversification.
"The three words that characterise the last decade have been 'Made in China'. The three words that are likely to dominate the next decade will be 'Owned by China'," said Gerard Lyons, chief economist at Standard Chartered.
"And by the time we move to the 2020s it will be 'Paid in renminbi'."
China may grab the most headlines, but it is not alone. Acquisitive companies from India, Mexico , Russia , Brazil and South Korea are also on the prowl.
Take Indian wind turbine maker Suzlon Energy, which owns 91 percent of Germany's REpower and whose chairman, Tulsi Tanti, says he can "leverage huge synergies" through matching REpower's technology with low-cost components.
Or Apollo Tyres, another Indian manufacturer that acquired businesses in the Netherlands and South Africa because, in the words of chairman Onkar Kanwar: "We are hungry and passionate and want to do things."
CARS AND BREAD
In the five years since China's Lenovo bought IBM's PC business for $1.25 billion, cross-border deals have changed other parts of the industrial landscape -- from cars to bread.
Jaguar and Land Rover are now owned by India's Tata Motors , while Mexico 's Grupo Bimbo will become the world's largest bread maker when it closes the purchase of Sara Lee's North American bakery business this year.
Firms in emerging markets want to move beyond the advantage of cheap labour -- anyway on the decline -- to create global organisations with the skill base found in Western companies.
The strategy looks to be working. By 2020, the top 100 stars of the developing world could collectively generate $8 trillion in revenues, roughly equivalent to aggregate S&P 500 revenues today, according to a new report from Boston Consulting Group.
The 100 "global challengers" come from 16 countries but China, India, Brazil, Mexico and Russia dominate the list.
"These companies see M&A as a path to access technology, to access channels and to access brands around the world," said Mark Foster, global head of management consulting at Accenture.
"We have to expect more of this because they've got the cash and, perhaps more importantly, they've got the confidence."
For emerging market firms, investing in sluggish developed world economies is a long-term play that sits alongside a parallel drive to snap up targets in other developing economies.
In that space, however, they are competing with Western multinationals whose growing appetite for assets in the world's big developing economies has driven up prices.
Last year, emerging markets accounted for 33 percent of the world's $2.4 trillion tally of all mergers and acquisitions -- totalling $806 billion, or a 76 percent increase over 2009, according to Thomson Reuters data.
Much of the activity was focused on resources, where China's state-owned firms, backed by soft loans, have made a land-grab for commodities, often in competition with India.
Asian groups like Sinopec of China and Thailand's PTT Exploration and Production struck deals last year ranging from buying stakes in oil fields to Korea National Oil Corp's hostile takeover of Britain's Dana Petroleum.
Helped by strong currencies, emerging market companies are also contemplating chunky deals in more advanced sectors.
DIALLING UP DEALS
Significantly, the biggest deal of any kind in 2010 was America Movil's $27.5 billion purchase, including debt, of Carso Global Telecom -- a tale of Latin American empire building by Mexican tycoon Carlos Slim.
India's Bharti Airtel, meanwhile, became the world's fifth largest mobile operator, by subscribers, after buying Zain's African operations for $9 billion in 2010, and Russia 's Vimpelcom is locked in its own fight for overseas expansion.
Things don't always pan out as planned for the new players.
Last year's $1.8 billion purchase of Ford's Volvo unit by Geely was a notable win for "China Inc", but earlier this month Xinmao threw in the towel on a 1 billion euros bid for Dutch cable maker Draka.
The odd setback and current fears of over-heating in some emerging markets are not likely to derail a key part of what Jim Quigley, CEO of Deloitte Touche Tohmatsu, describes as "the next phase in globalisation".
"What the U.S. and the UK accomplished in a 200-year span since the Industrial Revolution, we are going to watch China and India accomplish in a 30-year span," he said.
The chief executives of Tata Consultancy and Infosys told Reuters last Friday at Davos that Europe's debt crisis and rising inflation at home could slow the growth that they have enjoyed in recent years.
The main index fell 68.2 points to close at 18,327.76, with 17 of its components losing ground.
" Egypt is not a very big market for foreign institutional investors. There will be a reaction because of how it may affect the other regions, but a major reaction won't happen in India," said R.K. Gupta, managing director of Taurus Mutual Fund.
More than 100 people have been killed during six days of protests in Egypt aimed at toppling President Hosni Mubarak.
A wider conflagration in the region could threaten the flow of oil at a time when policymakers in emerging markets are already bedeviled by high food and fuel prices and some developed economies are gaining momentum.
Indian investors' sentiment has also been dented by soaring inflation and rate rises that are starting to hit corporate margins and leading to more foreign fund managers slashing holdings.
Foreign funds have pulled out over $1.06 billion from Indian equities in January until Thursday, in contrast with a record $29.3 billion they pumped in last year.
The rupee hovered near two-month lows pressured by the fund outflows.
"With the market and the rupee at these low levels, I will not be surprised if foreign funds start booking profits elsewhere to move to India," Taurus' Gupta added.
Banking shares were mixed after the banking sector index shed over 5 percent in the past three sessions on fears rising interest rates will hit demand for loans.
Mortgage lender Housing Development Finance Corp fell 2.7 percent and HDFC Bank dropped 0.8 percent, while top lenders State Bank of India and ICICI Bank bucked the trend and added 0.9 percent and 0.3 percent.
Top car maker Maruti Suzuki dropped more than 5 percent to a new 12-month low after its December-quarter net profit slipped 18 percent and its finance chief said cost pressures and competition would keep margins under pressure.
However, the shares rebounded towards the end of the session to close up 1.6 percent at 1,252.80 rupees.
Oil and Natural Gas Corp rallied more than 7 percent intraday after its quarterly net profit more than doubled, boosted by rising crude prices and one-time gains. The shares ended 3.7 percent higher at 1,177.55 rupees.
In the broader market, losers led gainers in the ratio of 1.5-to-1 on a volume of 329 million shares.
The Nifty or NSE-50 index was down 0.1 percent at 5,505.90 points.
By 1050 GMT, the MSCI world equity index and Thomson Reuters global stock index were down 0.3 percent each, while the emerging markets index declined 0.8 percent.
STOCKS THAT MOVED
* Siemens surged 21.6 percent to a 52-week high of 884.95 rupees after the company's parent Siemens AG said it was making an open offer to buy up to 19.82 percent stake in the Indian arm at 930 rupees per share. Its shares ended 17.3 percent higher at 853.50 rupees.
* MindTree plunged more than 14 percent to a 52-week low of 442.50 rupees after the company's chairman Ashok Soota resigned over the weekend. The software services provider's shares shed 5.1 percent to close at 489.20 rupees.
* Dr Reddy's Laboratories Ltd ended up 3.7 percent at 1,624.45 rupees after India's No. 2 drugmaker said a U.S. district court cleared the sale of its generic version of Sanofi-Aventis' allergy medicine Allegra D24.
MAIN TOP THREE BY VOLUME
* Unitech on 6.1 million shares
* SpiceJet on 4.6 million shares
* LIC Housing Finance on 3.8 million shares
"We are a homegrown multinational from a developing economy," said Jimmy Anklesaria, executive vice president for international operations at Godrej Consumer. "Our ability to understand consumers in developing economies is sharp."
Godrej bought Nigerian personal care products maker Tura last year for around $33 million, according to analysts, and has also bought hair care brands Rapidol and Kinky in South Africa over the past two years and is on the hunt for more acquisitions.
Companies and countries looking to buy up its natural resources has long dominated foreign investment in Africa.
Two blockbuster deals last year -- Bharti Airtel paid $9 billion for the African cellular assets of Kuwait 's Zain and Wal-Mart 's deal to buy South African retail chain Massmart for $4 billion -- show the allure of the continent's rising spending power.
That potential market has intrigued Indian makers of consumer goods such as Godrej, Dabur India, Marico and Emami, who have been among those buying up assets.
"There will be many more acquisitions made by Indian companies in the consumer space in the coming months," said a senior banker with Indian investment bank, which recently advised an Indian firm on a M&A deal in Africa. "We can expect some mid-sized acquisitions in early 2011."
RISING SPENDING POWER
African consumer spending will nearly double to $1.4 trillion by 2020, while the number of households in Africa with discretionary income will rise by 50 percent to 128 million over the same period, a recent McKinsey and Co. report predicted.
Indian companies hope to use their experience developing and selling products in markets where affordability is crucial to compete with global players such as Anglo-Dutch giant Unilever, which recently struck a deal to buy Sara Lee Corp's operation in Kenya.
"Africa is currently witnessing growth rates that India witnessed about 10-15 years back," said Anand Raghuraman, partner and director at the Boston Consulting Group.
A sizeable population of Africans of Indian origin in eastern to southern Africa give Indian companies an advantage over global competitors, including China.
Whereas global players sometimes sell one-size-fits all products, Indian manufacturers often adjust their offerings to suit local tastes and spending habits.
"The product portfolios of Indian companies are tweaked to suit local needs," said Debashish Mukherjee, principal with consultancy AT Kearney.
India was the most acquisitive country in sub-Saharan Africa in 2010, accounting for a third of the total value of deals done in the region, according to Thomson Reuters data. That was due mainly to Bharti Airtel's purchase of Zain's African assets.
RISKS AND GROWTH
Risks to Indian firms making acquisitions in Africa include overpaying in the competition for scarce attractive targets. Both the Bharti and Wal-mart deals were widely seen to be expensive.
Africa also remains price sensitive, so a spike in commodity prices would squeeze margins.
"In low-income countries, consumers spend a high proportion of their income on food and if prices shoot up as they did in 2007/08, they will immediately stop buying anything that's not essential," said Boris Planer, research director at Planet Retail.
Still, Indian consumer goods firms active in Africa expect growth of between 25-30 percent from their operations there, and expect opportunities to move beyond personal care to household care and over-the-counter healthcare products in coming years.
"Amongst all the Indian companies who are moving into Africa, Godrej and Dabur are best positioned to benefit maximum from the Africa story," given the early-mover advantage, said Shirish Pardeshi, a senior sector analyst with brokerage Anand Rathi.
There is plenty of Indian competition for African assets.
Emami, which won board approval in October to invest $1 billion to buy assets overseas and in India, is looking for more deals in markets including South Africa, Kenya and Nigeria, Group Director Harsh Agarwal told Reuters.
Marico, with cash of $480 million, said it is looking to buy assets in North Africa and South Africa, while Godrej, with cash of $537 million as of end September , continues to hunt for buys across Africa.
Dabur, one of the most active Indian players in Africa, is sitting on cash reserves of $873 million and recently brought out U.S.-based personal care products maker Namaste Labs and its two African units for $100 million.
It is looking for assets in the $10-$50 million range in South Africa, Nigeria, Kenya, Ghana, Mozambique and Tanzania, said Sunil Duggal, its chief executive officer.
"Africa is a good hedge for what is happening in the Indian markets and now asset valuations there are attractive compared to India," he said.
Egypt unrest pushes world stocks lower
On Monday 31 January 2011, 3:24 PM
By Simon Jessop
LONDON (Reuters) - Global shares continued to slide on Monday, while Europe's benchmark Brent crude was just short of $100 a barrel on fears political unrest in Egypt could spread among regional oil-producing nations.
Protests to end the 30-year rule of President Hosni Mubarak continued over the weekend, heightening risk aversion for European investors already concerned by the effect their own region's sovereign debt crisis and inflation could have on growth.
"Whilst Egypt 's importance to the global economy is limited, its importance to the transportation of oil is huge," said Jonathan Sudaria, night dealer at London Capital Group.
"Traders are concerned that with already rising inflation and falling real incomes for consumers, a further rise in energy prices could really dampen any consumer confidence and prospects for growth."
Benchmark Brent crude had come off slightly to trade down 0.4 percent at $98.93 a barrel by 0900 GMT, after hitting a 28-month high on Friday.
"The Egyptian situation looks to be the primary factor," said David Land, chief market analyst at CMC Markets. The market is reacting to "what this could mean in terms of stability for such a vital region for energy production", he added.
The protests in Egypt follow the collapse of the Tunisian government two weeks ago, and there are fears of similar unrest in other autocratic states including oil-rich Gulf nations.
Protest-contagion fears and risk aversion pushed European shares lower again at the open, with the FTSEurofirst 300 down 1 percent at 0900 GMT after falling 1 percent on Friday.
Elsewhere, the MSCI world equity index and Thomson Reuters global stock index were also both down around 0.5 percent, while emerging stocks were down 1 percent.
Overnight in Asia, the Nikkei share average had ended down 1.2 percent while the MSCI Asia Pacific ex-Japan stock index fell 1.1 percent.
Among commodities, spot gold steadied after hitting an Egypt-fuelled eight-week high on Friday, while copper rose 1.1 percent and other base metals also gained on short-covering ahead of a week-long Chinese holiday.
EURO, BUNDS STEADY
Weakness in equities helped Bund futures edge higher in early trade, with the prospect of further turmoil in the Middle East underpinning sentiment.
The Bund future was up 0.1 percent to 123.87 by 0849 GMT compared with 123.73 at Friday's settlement close.
Cash 10-year Bund yields and the two-year Schatz yield were both flat.
Moody's on Monday downgraded Egypt to Ba2 with a negative outlook on the back of the protests, citing a "far more uncertain outlook".
In currency markets, the euro was up 0.1 percent against the dollar by 0853 GMT, steadying after a Friday selloff on the back of the Egypt protests.
The dollar was flat against a basket of major currencies.
Ramesh gives clearance for Posco but with 60 more conditions
After putting it on hold, Environment Ministry today granted conditional clearance for South Korean major Posco''s USD 12 billion steel mill project in Orissa which also includes a captive port, setting 60 additional conditions.
Environment Minister Jairam Ramesh sought categorical assurance from the Naveen Patnaik government stating that the Forest Rights Act (FRA) has not been violated in the land acquisition process for the single biggest foreign direct investment project in India comprising a steel mill, a captive power plant and a minor port.
"Environmental clearance for the steel-cum-captive power plant is being accorded with 28 additional conditions over and above stipulated in the original environmental clearance of July 19, 2007," Ramesh said in his order.
"The environmental clearance for captive port is being accorded with 32 additional conditions over and above stipulated in the original environmental clearance of May 15, 2007," the order signed by the Minister said Ramesh inked the final approval for diversion of 1,253 hectares of forest land for the project with the assurance from the state government that those claiming to be dependent on or cultivating the land in the project area do not belong to the other traditional forest dwellers (OTFD) category under the Forest Rights Act, 2006.
"Final approval of diversion of 1253 hectares of forest land for the Posco project would be granted as soon as this assurance of the state government is received by the MoEF," the Minister said.
Forest rights activists had claimed that the state government had violated the FRA by contending that the project area was free from non-tribal and other traditional forest dwellers (OTFD).
In August last year, Environment Ministry had directed the Orissa government to stop land acquisition for the project.
The step was taken on the basis of a ground report submitted by a three-member committee set up by the Environment and Tribal Affairs Ministries.
"Undoubtedly, projects such as that of POSCO have considerable economic, technological and strategic significance for the country," Ramesh said.
At the same time, the Minister also adopted a middle path to ensure economic growth and also maintain green balance, saying, "laws on environment and forests must be implemented seriouly." .
Fiscal deficit down 44.75pc to Rs 1.71 lakh cr during Apr-Dec
NEW DELHI: The Centre's fiscal deficit narrowed by 44.75 per cent year-on-year to Rs 1.71 lakh crore during the first three quarters of the current fiscal on the back of better-than-expected revenue from the sale of spectrum and robust tax collections.
The central government's fiscal deficit stood at Rs 3.10 lakh crore in the corresponding period FY10.
The sharp fall in the Centre's fiscal deficit was also due to the fact that despite the enhanced flows to the central exchequer, there was not a commensurate increase in government's expenditure and the RBI has blamed this for the present cash crunch in the system.
Expenditure by the central government rose by 11.21 per cent during the period to Rs 7.86 lakh crore from Rs 7.07 lakh crore in the year-ago period. In contrast, the Centre's fiscal deficit for the same period last year stood at 77.3 per cent of the Budget estimate for 2009-10.
At Rs 1.71 lakh crore, the fiscal deficit in April-December, 2010 amounted to 44.9 per cent of the Budget estimate of Rs 3.81 lakh crore for the entire 2010-11 fiscal, according to data released by the Controller General of Accounts.
The government collected Rs 3.91 lakh crore in taxes during the nine-month period, which was 73.2 per cent of the budgetary target for the entire fiscal.
In comparison, tax collections during the same period last fiscal amounted to just 64.9 per cent of the whole-year target.
Furthermore, non-tax revenue in April-December, 2010, stood at Rs 1.93 lakh crore, higher than the Budget estimate for the entire fiscal, primarily on account of higher realisation from the auction of spectrum, which raked in approximately Rs 70,000 crore more than the government estimated.
The Centre's fiscal deficit targets went awry after the government provided a stimulus to the economy in the aftermath of the global financial crisis that broke out in 2008.
Among the measures, the government slashed taxes and stepped up public expenditure to spur the growth of the economy. However, this also led to widening of the fiscal deficit.
As a result, the fiscal deficit doubled to over 6 per cent in 2008-09, as against the maximum permissible limit of 3 per cent stipulated by the Fiscal Responsibility and Budget Management Act. The deficit rose further to over 6.5 per cent in the last fiscal.
After the government partially rolled back the stimulus by raising excise duty, the Budget estimates pegged the fiscal deficit at 5.5 per cent of the GDP for the current fiscal.
However, despite the higher realisation from the sale of spectrum for high-speed telephony and broadband services, the government expects the fiscal deficit to be contained at the same level as its Budget estimate.
26 JAN, 2011, 06.38AM IST, MALINI GOYAL,ET BUREAU
India with $1,000 per capita income ready for growth marathon
NEW DELHI: It may have happened in the middle of 2010. It may happen a month from now. Or, it may happen by the end of this year. The precise timing matters less than the implication of the achievement, India's per capita income has either just about or will soon cross the $1,000-mark. In rupee terms, this translates into an average annual income of roughly Rs 45,000 for every Indian.
"The $1,000-income is the start of the take-off of a nation," says Janmejaya Sinha, chairman, Asia Pacific, of consulting firm BCG. "It is around this number that a nation gets out of subsistence spending and moves more and more into higher quality branded product," adds Chetan Ahya, MD, Research, Morgan Stanley .
China reached this threshold in 2003, and has since unleashed a consumption boom that the world is in awe of. Today, its per capita income is at $3,400.
What's so significant about the statistics of $1,000? After all, even countries like Ghana and Afghanistan too are close to achieving this figure. The figure is significant if it is accompanied by a few other things: an economy of the size of at least $500 billion, a healthy and sustainable growth rate in GDP and a large population. India has all the three pieces of this equation, and has them in plenty.
"It is the presence of all these factors together that makes both India and Indonesia exciting. We (India) will have to work really hard to mess it up," says Sinha.
Three aspects, timing, scale and speed, of India reaching the $1,000-per-capita-mark makes it out of the ordinary. The three will act as a force multipier for each other. The most obvious implication is the nature and size of consumption. India, like China in recent years, will be a consumption powerhouse of the world.
But the consumption curves could be markedly different from other countries that passed this threshold in the past. "This is the beginning of a series of inflection points in different product categories," says Sunil Dutt, president, personal systems, HP India .
Ahead of the global curve
This has huge implications for what Indians will consume in the coming years to come and at what rate. Thanks to innovations in technology and business models, what consumers in the West, or even in China, started to consume at the per capita income level of $2,000 or $3,000, Indians would begin to consume much earlier. The lower level of household debt will also influence the consumption pattern.
For example, in 2003, entry-level digital cameras cost around Rs 12,000 as against Rs 5,000 today. According to Alok Bhardwaj, senior VP, Canon India , in China, camera penetration moved from 3% to 15% between 2001 and 2010. India will make this transition in half the time, between 2010 and 2015.
MNCs' increasing focus on emerging markets and re-engineering of products will hasten the trend. In Japan and South Korea, the per capita threshold at which the car sales began to take off was around $3,500. But for India, a similar inflection point for the car industry can come much earlier at around $2,500 per capita income, says Anirudha Dutta, executive director, CLSA India .
30 JAN, 2011, 12.42AM IST, PANKAJ MOLEKHI,ET BUREAU
India's population: Demographic dividend or explosion?
NEW DELHI: If India were to outsource its ongoing national census 2011, it would need to employ half of Denmark for a little less than a year to complete the project. Logistic mumbo-jumbo apart, graphing and mapping the denizens of a country as diverse and divided as ours is a task of inhuman proportion. Yet, conducting a census is the smallest of the challenges that lie ahead of this 1.2-billion-strong nation. The biggest is harnessing our mammoth manpower into a skilled workforce—to enhance quality in the quantity. So that we can be the best of the world.
"The same teeming millions that once evoked images of hungry, wailing children in the mid-Seventies, have proved to be our biggest strength today in the form of vibrant workers and consumers," says Ashish Bose , a member of the National Commission on Population headed by the PM. "This was made possible because we were able to equip ourselves with scientific education and specialised skills." However repetitive it may sound, this was possible not because of our political leadership but in spite of them.
In his 1939 address to the Tripuri Congress, Subhash Chandra Bose was perhaps the first Indian leader to sound a Malthusian crisis, when the well-meaning (then) Congressman said: "With regard to the long period programme of a free India, the first problem to tackle is that of our increasing population." The following year, a panel on population submitted a report that linked population stabilisation to socio-economic development, emphasising on "limiting excessive population pressure". In the subsequent decades, the approach of successive governments towards population planning swung from the Nehruvian pragmatic to Sanjay Gandhi's lunatic measures.
In an interview given to ET, JRD Tata had reminisced how Nehru once retorted to his concerns on rising population. "Nonsense, a large population is the greatest source of power of any nation," the first prime minister of Independent India is believed to have told the industry doyen. Interestingly, his words proved prophetic only after India shed its socialistic hangover and moved towards a liberalised economy in the early Nineties. But that is not the end of the story. Nandan Nilekani in his book Imagining India, while corroborating the rise in population with surge of economic growth, also underlines the dangers of being too complacent. Education, healthcare, dwindling gender ratio, inequity are some of the issues that requires attention before one gloats over the growing millions of consumers and free-flowing foreign direct investments.
The question of whether a large population is a bane or a boon has changed into the need for creating a sustainable population to keep economic growth going. All over the developed world, population is shrinking and aging at a rapid pace, be it Europe, the US or Japan. The impact is possibly the worst in Japan where over 22.5 per cent of the population is over the age of 65, which is expected to increase to 40 per cent by 2055. It is estimated that the Japanese population of 128 million could come down to 96 million by 2050 and 64 million by 2100. In 2007, there were 29,000 few Japanese than a year before. Their economic growth has been affected in the last decade and the prospects for the next two decades are bleak as the working age population continues to decline.
India can count several advantages here. "While India would be going through the most exciting phase of economic development ever over the next 20 years, with the potential to grow its economy by over four times, the lack of an adequately educated and skilled population would be a drag preventing the country from achieving its potential," says TV Mohandas Pai of Infosys Technologies .
To the question what is needed to do to make the population more productive, Pai points out that all societies which have grown wealthy have done so because of the availability of immense natural resources or an increase in the education and skills level of its population. "The government has come out with a skill development mission to create a skilled population of 50 million but lack of an adequate institutional mechanism, bad labour laws which go against the need for more apprenticeship programmes and lack of investment at the right level, the odds are against achieving this number."
Politicians or sociologists may suggest caution, but marketers are gung ho with the surge in numbers and change in attitudes. A younger, more literate India is driving the growth of consumption in India. The NCAER-CMCR youth readership survey estimates that of the 459 million youth in 2009, 333 million are literate.
5 JAN, 2011, 01.45AM IST, AMIT BAPNA,ET BUREAU
An educated population is the nation's greatest asset: Kapil Sibal
If there's one sector that's at the cusp of massive growth, it's education. According to an Ernst & Young study on the higher education sector in India, spends on higher education stand at Rs 46,200 crore. The growth rate for this segment is projected at 12.8% and is expected to touch nearly Rs 150,000 crore in the coming decade, the report says. Right from kindergarten to PG, there is an influx of players who are looking to create a niche through various marketing and branding initiatives. In an exclusive with ET, Union Minister for Human Resource Ddevelopment, Kapil Sibal , dwells on the role of private sector in the education space and how an education brand should be marketed as 'a social or a public good'.
What role can private sector play in enhancing quality in education? What according to you is the best example of public-private sector cooperation you have seen in the education sector?
Let me at the outset place a few facts for you to clarify the issues involved. We all recognise that an educated population is the nation's greatest asset. The government has accordingly set the goal to achieve near universalisation (100% enrolment and attendance) for primary education, enhance the gross enrolment ratio in secondary education from 50% to 75% and in higher education from 13% to 30% within this decade. The task is unprecedented in the annals of human history and beyond the capacity of either the government or private sector alone.
We thus need both government and private players to work with each other in a synergistic and symbiotic relationship rather than in an antagonistic mode. The government has the advantage of existing infrastructure, credibility and scale, whereas private sector is innovative, dynamic and has a strong management culture. Private sector can thus help to bring in competitive merit and to force periodical changes in curriculum, pedagogy, delivery mechanisms, examination system remuneration and governance across the entire educational sector.
One measure to harness the strengths of both is through government-owned private managed educational institution albeit with pre-specified conditionalities, including outcomes and performance. Several successful examples of such co-operation are there in the vocational education sector.
With the huge demand for education across levels—from pre-primary to post-graduate—education is being marketed aggressively. What do you think of this trend?
Today most private sector players treat education as any other product to be packaged and marketed as a 'private good', however I would like to consider it to be a 'social or a public good' and thus to be marketed appropriately and responsibly.
What according to you constitutes an education brand?
An education brand arises from five attributes: quality, value for money, USP, social recognition and acceptability.
What are some dos and don'ts that education institutes should keep in mind while they embark on marketing themselves?
Dos: observe complete truthfulness, transparency and clarity in regard to infrastructure, faculty, financial integrity, fees/ charges, accreditation/ recognition, performance and placement.
Govt names Hazarika interim chief of ONGC, Narasimhan of IOC
The government today named A K Hazarika as acting chairman of Oil and Natural Gas Corp (ONGC) and S V Narasimhan as interim head of Indian Oil Corp (IOC).
The interim appointments have been made as Oil Minister S Jaipal Reddy is yet to approve files pertaining to the appointment of fulltime chairmen of the two companies.
Hazarika, currently Director (Onshore) and the seniormost director on ONGC, has been appointed acting Chairman and Managing Director of ONGC for three months with effect from February 1 or till a regular incumbent is appointed, whichever is earlier, government orders said.
He takes over from R S Sharma, who superannuated today. Hazarika has also been given additional charge of Director (Exploration) upon superannuation of DK Pande today.
Similarly, Narasimhan, currently Director (Finance) and the seniormost on IOC board, will takeover from February 1, the order said. He replaces acting Chairman B M Bansal, who too superannuated today.
IOC has been without a permanent chairman since March 1, 2010 after government decided not to continue with Sarthak Behuria till his superannuation in 2012.
While Bansal, the senior most director on IOC board, was appointed acting chairman from March 1, government headhunters Public Enterprise Selection Board on September 29 interviewed potential candidates and selected R S Butola for the post.
Just a day before that PESB had selected R K Singh to head Bharat Petroleum , where the vacancy of Chairman and Manging Director arose when Ashok Sinha quit in August, 2010.
Sources said formalities of Singh's appointment including clearances by anti-corruption bodies and ratification of his candidature by the Cabinet Committee on Appointments were completed in two months and Singh took over on December 8.
But in case of IOC, the file movement started only in December-end, they said, adding the file seeking appointment of Butola had reached Cabinet Secretariat on January 19 when Reddy replaced Murli Deora at the Oil Ministry.
The file was sent back to Reddy for concurrence and is still lying on the new minister's desk, they said.
In case of ONGC, PESB had on October 19 selected Sudhir Vasudeva, Director (Offshore), ONGC, to replace Sharma. CVC while processing his file for clearance, sought certain clarification from the oil ministry and the same is lying with Reddy's office, sources said.
The problem is more severe at ONGC which is without a Director (Human Resources) since mid-July when Ashok Balyan moved jobs to Petronet LNG. PESB will interview potential candidates for the position on February 22, sources said, adding Director (Exploration) D K Pande too retired today and appointment of his replacement too is stuck with Reddy.
Govt can garner Rs 90K cr from 1.8Mhz of 2G spectrum sale:TRAI
The government can collect over Rs 90,000 crore by allotting additional 1.8 Mhz of 2G spectrum to six new operators with pan-India operations, going by TRAI's draft recommendation for 2G spectrum pricing .
Telecom Minister Kapil Sibal has fixed the contracted amount of start-up spectrum at 4.4 Mhz for new operators (who got licences in 2008) vis-a-vis 6.2 Mhz for old operators like Bharti, Vodafone and Idea.
As per the new policy, the new operators would have to pay market price for additional 1.8 Mhz of spectrum to come at par with the old operators.
Sources in the know said that TRAI is contemplating a maximum price of Rs 707.28 crore per Mhz of spectrum (1800 band) for the Uttar Pradesh (East) circle followed by Rs 617.09 crore per Mhz for Rajasthan circle.
According to TRAI's draft recommendations, the pan-India value for 1.8 Mhz would cost a new operator over Rs 15,082 crore to take the initial start-up spectrum to 6.2 Mhz level on par with old operators.
TRAI is in process to give its recommendations on 2G spectrum prices. Earlier, it had proposed linking 2G spectrum prices with 3G. This was opposed by the incumbent operators following which the TRAI had said that it would re-visit the matter.
Meanwhile, Telecom Minister Kapil Sibal has announced new spectrum policy and delinked spectrum from licence. According to the new regime, the operators would have to pay a market price for start-up as well as additional spectrum.
While announcing the policy, the minister had said that the ministry would wait for TRAI's recommendations on spectrum pricing and then a final decision would be taken on whether to follow the auction route or fix a market-driven price for each Mhz of spectrum.
Each Mhz of spectrum on pan-India basis would cost over Rs 8,380 crore with highest bid in Uttar Pradesh (East), according to draft recommendations.
According to industry analysts, the new regime of spectrum pricing may push upward tariffs for mobile services, as the operators would have to pay heavily for procuring airwaves compared to
Reports said that after the news spread stating MoEF cleared the POSCO project the project supporters mainly the United Action Committee [UAC] a pro project outfit of the area expressed happiness and extended warm wishes to the union forest minister Jairam Ramesh and UPA led Congress government including state ruled BJD government and asserted the project would be come up very soon.
Speaking to this correspondent Nirvaya Samantray UAC general secretary remarked we feel jubilant after knowing the union MoEF decision and still maintained supporting the project and demanded our earlier 29 demands relating to the project would be considered sympathetically.
Another UAC leader Tamil Pradahn remarked against both union and state governments and blamed owing lack of coordination between both governments POSCO project is lagging and said the mega steel project at utter uncertainty and several committees reports have been beaten the state government black and blue and that had too exposed the state government failing to do the ground works perfectly before and after the signing of the MoU with South Korean steel major so after getting clearance the state government needs to look after their old faults, he suggested.
On turn the anti project out fit PPSS who has been opposing the project since the state government sign the MoU with POSCO has criticized the conditional clearance to the POSCO project and port and described MoEF has delivered bias clearance in favour of POSCO without considering the factual aspects and ground realties so we are forced to go on agitation and ready to fight with the both union and state governments, informed Abhya Sahoo, PPSS chairman.
Meanwhile sources added PPSS has decided to host a massive rally and protest meeting at Patana village on Tuesday opposing the union MoEF conditional clearance to the POSCO and several anti industrialization outfits and their leaders including left party leaders would grace the occasion.
Foreign capital has a key role to play in the economic development of India. It is recognized that almost third share of the investment in India is by NRI. Indian government has been continuously proceeding for economic reforms and is quiet assure to secure legislation to allow more foreign investment in areas such as insurance. On top of it, the Government knows the key role of Foreign Direct Investment (FDI) in economic development not only as an addition to domestic capital but also as an important source of technology and global best practices.
Foreign direct investment (FDI) has always played a major role in the economic development of developing nations like India after playing the leading source of external financing in 1990s. India has now become the third most favored destination for Foreign Direct Investment (FDI), behind China and the USA.
With an increase of 18.6 per cent from U.S.$ 2,696 million in 1996-97 to U.S.$ 3,197 million in 1997- 98. With this FDI inflow in the country rose nearly three-fold to $15 billion in 2006-07 as the world's second-fastest growing economy attracting investors from across the world.
The rise in FDI volume has changed the composition of market resulting investment happening in the form of acquisition of existing assets (mergers and acquisitions) growing much more rapidly than investment in new assets particularly in countries undertaking extensive privatization of public enterprises.
According to the Global Development Finance report, the net private capital flows to developing countries reached a record $647 billion in 2006 – a 17 percent increase from the year before. However, only about 8 percent of that capital flowed to the poorest 51 countries showing India as the most important of the other growth markets in Asia. The country has achieved steady economic growth, with an increase of 7 per cent in 2005 alone after starting the gradual economic liberalization process in 1991. Now the country has a liberal and transparent FDI policy.
Still the government needs to focus on the real barriers to its foreign investment goals – namely inflexible labor laws and poor roads and other infrastructure. Also there is a need for higher foreign investment, in the form of foreign direct investment (FDI) and FII. These type of investment initiates technology spillovers, assists human capital formation, contributes to international trade integration and particularly exports, helps create a more competitive business environment, enhances enterprise development, increases total factor productivity and, more generally, improves the efficiency of resource use.
Over the past few years the far-reaching measures introduced by the government to liberalize the Indian market and integrate it with the global economy are widely acknowledged. The value of foreign trade has increased substantially with increase in both exports from and imports into India. This can be justified by the statement that the total volume of foreign trade in 2001-02 was over US$ 95 billion. In addition to this, the government had announced, in April 2000, the establishment of Special Economic Zones (SEZ) policy to boost exports and attract foreign investments. Here, the SEZs would offer world class infrastructure
In the manufacturing sector, companies have consolidated around their area of core competence by tying up with foreign companies to acquire new technologies, management expertise and access to foreign markets. The cost benefits associated with this sector have positioned India as a favorite destination for manufacturing and sourcing for global markets. In the financial sector it is required that public policy should be focused on maximizing benefits achieved by the growing involvement of foreign firms by encouraging diversity and competition not only between foreign and domestic banks but also between banks and financial institutions. Whereas, smooth functioning of the market for corporate control would be assisted by greater international compatibility of accounting standards, takeover rules, and insolvency codes.
Certain projects coming from the Reserve Bank or the Securities and Exchange Control of India or Sebi can come through without any barriers or permission. India could thus be said to be opening up to genuine investors.
Department of Industrial Policy & Promotion
|FDI in India Statistics|
|S. No.||Name of the Document||Date|
|India FDI Fact Sheet - November 2010||19-01-2011|
|India FDI Fact Sheet - October 2010||27-12-2010|
|India FDI Fact Sheet - September 2010||23-11-2010|
|India FDI Fact Sheet - August 2010||22-10-2010|
|India FDI Fact Sheet - July 2010||01-10-2010|
|India FDI Fact Sheet - June 2010||01-09-2010|
|India FDI Fact Sheet - May 2010||05-08-2010|
|India FDI Fact Sheet - April 2010||13-07-2010|
|India FDI Fact Sheet - March 2010||26-05-2010|
|India FDI Fact Sheet - February 2010||30-04-2010|
|India FDI Fact Sheet - January 2010||06-04-2010|
|India FDI Fact Sheet - December 2009||19-02-2010|
|India FDI Fact Sheet - November 2009||22-01-2010|
|India FDI Fact Sheet - October 2009||23-12-2009|