Australia Is Interested On Doing Business - Sep 30, 2008

Australia is interested on doing business with India and on making its presence felt, especially in tier II cities such as Visakhapatnam. At a seminar on ''Doing business with Australia'' here on Sept 29, conducted by CII''s local chapter, Australia assured local businessmen and industrialists that the consulate will give them help to promote Indo-Australian trade. The bilateral trade has increased to $11 billion and Australian investments in India to $4 billion.

Call Rates Ended Considerably Higher - Sep 30, 2008

The inter-bank call rates ended considerably higher at 15.75-16 per cent, as against the previous close of 11-11.50 per cent. The severe liquidity crunch could also be estimated by the fact that the Reserve Bank of India injected more than Rs 90, 000 crore into the system via the repo auction. In the two-day repo auction under the first liquidity adjustment facility (LAF), the RBI got and accepted 36 bids worth Rs 53,940 crore. There were no reverse repo bids. In the CBLO market, there were 300 trades totaling to Rs 12,183.35 crore in the rate range of 9.35-16 per cent.

Bond Prices Opened Lower After The Reserve - Sep 30, 2008

Bond prices ended lower by about 50 paise from Sept 26 close on fears of tightness in liquidity, though they recovered from the day''s low. Banks have been borrowing close to around Rs 1 lakh crore from banks for the last few days. Today they borrowed more than Rs 90,000 crore via the repo auction. Total traded volumes on the order matching system were Rs 3,560 crore (Rs 5,900 crore).

Bond prices opened lower after the Reserve Bank of India declared the auction calendar for the second half of the fiscal on Sept 26. The 8.24 per cent-10 year-2018 paper opened at Rs 97.05 and touched an intra-day low of Rs 96.86. It closed at Rs 97.56, against the previous close of Rs 97.87. The 7.94 per cent -13 year-2021 paper, which was the second most actively traded paper, opened at Rs 91 and declined to a low of Rs 90.85. It closed at Rs 91.08

Economic Commission Including Business - Sep 29, 2008

A mixed joint economic commission including business people and authorities from India and Switzerland are to meet in Delhi and Bangalore from October 20-22 to debate on what could be done to develop the business climate between the two countries. Efforts are on to provide more significance to the joint economic commission mechanism and there would be more activity comprising meetings on a regular basis, at least once a year. Indian companies were told about the possibilities in Switzerland if they want to set up their subsidiaries, branch offices or even their headquarters. Switzerland offers wide range of advantages for companies from India to establish their own business in Europe. Switzerland has till date cumulative investments in India of over 2 billion swiss francs.

India-Korea Economic Agreement To Restore - Sep 29, 2008

The stitching up of the finer details by India and South Korea on Sept 25 in Seoul for a Comprehensive Economic Partnership Agreement (CEPA) to be unveiled by the first half of next year covering trade, goods and investment will assist balance the historic ties both the countries held in the past. The Indian official level delegation, the Commerce Secretary, Mr Gopal K Pillai, said that the Korean Deputy Minister, Mr My Hye-min Lee, said that this is the second most important accomplishment in India-Korea relations.

India''s exports to South Kora have been cranking up at 40 per cent a year, while their exports to India were at 30 per cent, leaving the excess balance of trade in India''s favour. Stating that the highest official level meeting is over between the two countries, he said that some clearing up of the formal text is left so that the final text of the pact will be made public by Oct 31 by both the sides.

FMC Calls For Strengthening Regulations - Sep 29, 2008

The financial meltdown in the US economy is unlikely to affect the Indian commodity sector but there is a need to strengthen the regulatory mechanism in the country, a top government official said. The financial meltdown in the US is a great lesson for us. It may not affect the commodity sector in India but we need to strengthen our regulatory mechanism, Forward Markets Commission Chairman B C Khatua said, while addressing the Global India conference here. Asian countries and India have successfully bounced back from the 1997-98 meltdown. US meltdown was a case of greed for money.

Allowing markets to go unregulated is a dangerous thing. The US housing and financial sectors have been pretty ambitious and greedy in the race to retain the number one position, Khatua said. In India, it is unimaginable for a strong company to go bankrupt in a year''s time, as here the growth came from strong fundamentals. The recent crude price hike was due to rampant speculative activities.

Marginally Higher On Improved Liquidity - Sep 26, 2008

Bond prices ended marginally higher on improved liquidity and easing of oil price. There was not much demand for funds as most participants had covered their positions ahead of reporting Friday, the source said. Crude oil prices fell by $1-2 in the global market, which also helped bond prices. Total traded volumes on the order matching continued to be lower at Rs 3,455 crore (Rs 4,220 crore), due to the strike by public sector banks. The 8.24 per cent-10 year-2018 paper opened at Rs 97.75 (8.59 per cent YTM) and closed at Rs 97.87 (8.61 per cent YTM) against the previous close of Rs 97.5 (8.62 per cent YTM). The 7.95 per cent -24 year -2032 paper opened at Rs 88.3 (9.17 per cent YTM) and closed at Rs 88.55 (9.13 per cent YTM).

Repo Auction Under The First Liquidity - Sep 26, 2008

Call rates closed a tad at 10-10.25 per cent, the same as on Sept 24.The RBI received and accepted 25 bids worth Rs 38,545 crore in the one-day repo auction under the first liquidity adjustment facility (LAF). There were no reverse repo bids. In the one-day repo auction under the second LAF, the RBI received and accepted 21 bids for Rs 10,660 crore. There were no reverse repo auctions. In the CBLO market, there were 380 trades amounting to Rs 21,844.70 crore in the rate range of 8.85-9.05 per cent.

Inflation Remains Unchanged At 12.14% - Sep 26, 2008

Inflation remained unchanged at 12.14 per cent for the week ended September 13 even as the Finance Ministry said prices of essential items like cereals, pulses, sugar and edible oils declined on weekly basis. High inflation of 12.14 per cent, which is the same as the previous week''s figure, has prompted analysts to say that price rise will remain at double digits by the end of this calendar year due to base effect.

Inflation figure remained intact despite a low base of 3.51 per cent in the year-ago period. The Finance Ministry said in a statement here that inflation of 30 essential items declined to 7.58 per cent during the week under review compared to 7.72 per cent in the previous week.While prices of food items like salt, sea fish, tea, fruits, condiments and spices rose, rates of imported edible oil declined, giving some relief to the government which was unable to control its prices because of rise in global rates. Among manufactured goods, items like tobacco, rubber, chemicals, mineral and machinery turned dearer

Bank Of India Was Seen Selling At Levels - Sep 25, 2008

The rupee opened at 45.75/77 and closed at 45.95/96, down 50 paise from the previous close of 45.44/45. A forex dealer with a private bank said that Reserve Bank of India was seen selling at levels of 46.10. A dealer with a large PSU bank said the bank only covered its customer transactions and stayed away from the regular trading in the forex market. In the forward premia market, six-month closed at 1.62 per cent (1.6 per cent) and the 12-month closed at 1.33 per cent (1.34 per cent).

Sudden Announcement Of Auction Of Government - Sep 25, 2008

Bond prices slipped by Rs 1.20, following the sudden announcement of auction of government securities for Rs 10,000 crore. The announcement for auctions of 7.94 per cent-13 year-2021 paper worth Rs 6,000 crore and the 8.28 per cent-24 year-2032 paper for Rs 4,000 crore was unexpected for sure. The two-day bank strike along with the bearish sentiment prevailing in the market led to low trading volumes, added the dealer. Total traded volumes on the order matching system were lower at Rs 4,220 crore (Rs 6,470 crore). The 8.24 per cent-10 year-2018 paper opened at Rs 98.0 (8.54 per cent YTM) and closed at Rs 97.5 (8.62 per cent YTM), against the previous close of Rs 98.68 (8.44 per cent YTM)

Auction Under The First Liquidity Adjustment Facility - Sep 25, 2008

Call rates end lower at 10-10.25 per cent against the previous close of 12.0-12.25 per cent. The RBI received and accepted 37 bids worth Rs 54,430 crore In the one-day repo auction under the first liquidity adjustment facility (LAF). There were no reverse repo bids. In the one-day repo auction under the second LAF, the RBI received and accepted 22 bids for Rs 9,890 crore. In the one-day reverse repo auction under the second LAF, there was 1 bid for Rs 5 crore. In the CBLO market, there were 335 trades amounting to Rs 15,765.70 crore in the rate range of 8.67-9.85 per cent.

Rupee Depreciates On Dollar Demand - Sep 24, 2008

The rupee closed almost 20 paise lower owing to strong dollar demand and a weak domestic equity market. The rupee opened at 45.50 and touched a low of 45.94 during day trade. The domestic currency closed at 45.73, against the previous close of 45.44/45. There was dollar selling by the central bank at levels of 45.83, which helped the rupee recover towards close. There are concerns that there could be more outflows from the capital market, said the dealer. In the forward premia market, the six-month closed at 1.6 (1.66 per cent) and the 12-month at 1.34 (1.38 per cent)

Call Rates Close Lower At 12.25 Per Cent - Sep 24, 2008

Call rates closed lower at 12.0-12.25 per cent, against the previous close of 14.0-14.5 per cent. The RBI received and accepted 44 bids worth Rs 52,145 crore in the one-day repo auction under the first liquidity adjustment facility (LAF). There were no reverse repo bids. In the one-day repo auction under the second LAF, the RBI received and accepted 33 bids for Rs 18,155 crore. There were no reverse repo bids in this auction also. In the CBLO market, there were 388 trades amounting to Rs 19,531.30 crore in the rate range of 8.85-10 per cent

RBI Issues New Directions For Nbfcs - Sep 24, 2008

The Reserve Bank on Sept 23 asked the auditors of non-banking financial companies to make a separate report to the concerned company''s board apart from the usual report under the Companies Act. The report must include the facts like whether the company holds certificate of registration from the Reserve Bank and whether the company is entitled to hold such certificate in terms of its assets and income pattern. In this regard the central bank of India issued NBFC Auditors Report (Reserve Bank) Directions 2008 replacing directions issued in 1998.

RBI official said, the new directions have not been issued because of ongoing global financial crisis but are a rejig of the existing norms. The direction also asked the auditors of public deposit taking NBFC to mention in the report whether it borrows from public through unsecured non-convertible debentures and whether it borrows from its shareholders in case it''s a public limited company. The report must also mention whether the company has defaulted in paying to its depositors the interest and/or principal amount. Besides, it must include capital adequacy ratio of certain kinds of NBFCs. In case of NBFCs which do not accept public deposits, auditor will have to state in the report whether the board has passed the resolution for non-acceptance of public deposited and whether the company has accepted any such borrowings

Bond Prices Slip By 55 Paise - Sep 23, 2008

Bond prices dwindled by 55 paise on Sept 22, as the liquidity crunch in the system continued. Total traded volumes on the order matching system were lower at Rs 3,790 crore (Rs 5,650 crore). Oil prices increased to $106 per barrel pulling up bond yields. There was paying interest in the overnight index swap market, added the dealer. The 8.24 per cent-10 year-2018 paper opened at Rs 98.65 (8.43 per cent YTM) and touched an intra-day high of Rs 98.94 (8.40 per cent YTM). It closed at Rs 98.45 (8.47 per cent YTM), against the previous close of Rs 99 (8.39 per cent YTM). The second highly traded paper, the 7.95 per cent-24 year-2032 paper, opened at Rs 90.65 (8.89 per cent YTM) and closed at Rs 90.15 (8.95 per cent YTM)

Call Rates Close Higher - Sep 23, 2008

Call rates closed significantly higher at 14.0-14.5 per cent, against the previous close of 11.5-12.5 per cent. The rates touched an intra-day high of 15-15.5 per cent signalling tight liquidity in the market. The Reserve Bank of India has put in around Rs 79,000 crore into the system through the repo auction. In the one-day repo auction under the first liquidity adjustment facility (LAF), the RBI received and accepted 49 bids worth Rs 63,595 crore. There were no reverse repo bids. In the one-day repo auction under the second LAF, the RBI received and accepted 18 bids for Rs 15,265 crore. There were no reverse bids in this auction also. In the CBLO market, there were 408 trades amounting to Rs 17,051.65 crore in the rate range of 8.05-10 per cent

Rupee Closes Firmer On Stock Market Movement - Sep 23, 2008

The rupee closed tad firmer tracking the stock market movement. The rupee opened at 45.55 and touched a high of 45.22/23. Nevertheless, the rupee closed lower at 45.44/45, against Friday''s close of 45.83. According to a forex dealer with a public sector bank, the rupee may hover between 45 and 46 and is not likely to cross 46. In the forward premia market the six-month closed at 1.66 per cent (1.38 per cent) and the 12-month at 1.38 per cent (1.15 per cent)a

CII Prefers Easier FDI Guidelines For Small Unitsa - Sep 22, 2008

The Confederation of Indian Industry (CII) is recommending simplification of the Foreign Exchange Act for easier participation of foreign direct investment (FDI) in the micro, small and medium enterprises (MSME) sector. One of the recommendations that the CII has made to the Government is to continue providing SSI status to companies even if the FDI limit is above 25 per cent. The industry body has also recommended automatic approval for 100 per cent FDI from non-resident Indians. The idea of the SME exchange is to create an effective market for raising equity funds by the SME sector and create a platform for infusing fresh capital to expand their business. In an effort to upgrade the SME sector, CII is also launching an SME portal as a one-stop shop for information on the sector

Insulate Economy From Global Catastrophe: CPI - Sep 22, 2008

Urging the United Progressive Alliance government to draw lessons from the American economic crisis, the Communist Party of India on Sunday said steps should be taken to insulate the Indian economy from global catastrophe. The U.S. economy model and their financial system are being projected as the best in the world but the bluff has been called. The deregulated financial system set up in the USA is the worst model to be emulated by [the] country. But it is shameful that the Government of India is in a hurry to copy this model in our country, the party national executive said at the end of its two-day meeting here.Referring to the collapse of Lehman Brothers and the failure of Merrill Lynch and AIG, it said these signified the hollowness of the capitalist market economy. These collapses and sell-outs have sent panic waves across the global market. The collapse of Lehman Brothers exposed the myth of the omnipotence of the American financial system. Their economy was already facing a deep crisis. With a capital of $30 bn., Lehman Brothers have loans and investments of over $630 bn. without proper safeguards

Ndian Economy Resilient Enough To Stave Off Any Spillover: FM - Sep 22, 2008

Finance Minister P Chidambaram allayed fears over the global financial turmoil, saying the Indian economy is resilient enough to stave off any spillover.Global markets remained jittery for the fourth day amid reports that Morgan Stanley was preparing for a possible sell-off, and back home, a stock broker each in Hyderabad and Indore committed suicide, allegedly because of trade losses.

Let me assure everyone (that) there is no cause for any alarm that any Indian bank is exposed or is vulnerable like couple of banks that have failed in the US, Chidambaram said.

His comments helped the Sensex bounce back from a 705-point plunge in early trading and close 52 points higher.The Sensex has lost more than 1,600 points, or 11 per cent, since September 8, when it became apparent that some of the top US financial firms could go bankrupt.The week opened with Lehman Brothers'' bankruptcy and Merrill Lynch''s sale. Following them was American International Group, the world''s largest insurance company, which got a $85 billion bailout from the US government.

This stoked fears that more financial firms could report trouble and set off a chain reaction across markets worldwide. Although India''s share market has been hit hard, analysts say the impact on the broader economy would be limited as it is relatively less open compared to many of its peers

Inflation Rises Marginally To 12.14% - Sep 19, 2008

Increasing prices of food articles pushed the wholesale price index (WPI)-based inflation up to 12.14 per cent for the week ended Sept 6, against 3.46 per cent a year ago. Prices of food articles increased 11.27 per cent, compared with 10.07 per cent for the week ended August 30, when inflation was at 12.10 per cent, the third straight week when it had saw a decline. However, the price index of two other categories fuel and power, and manufactured products fell to 16.66 per cent and 10.78 per cent, respectively

Rupee Closes At 46.42 Against Dollar - Sep 19, 2008

The rupee depreciated slightly against the dollar on Sept 18, pulled down by the meltdown in world indices. The domestic currency opened lower at 46.63/65, and weakened further to reach an intra-day low of 46.79. It recovered to end at 46.41/42, against the previous close of 46.34/35. In the forward market, the 6-month premium closed lower at 0.63 per cent and the 12-month ended at 0.63 per cent

Fiis Keeping Out Investments In India - Sep 19, 2008

The Indian realty sector has been facing a cash crunch amid the global financial turmoil. Now, its only saviour the FII money, too, is on the shaky ground. The Big Five at Wall Street are all falling like dominos and for the Indian real estate players that means a big source of fund drying up. The FII money was a savior for most of the developers stuck with big projects lacking funds as debts have been too expensive. Industry sources say over $14 bn in FDI was seen flowing into realty market over next 18 months but now only half may come in.

Of the $10 bn invested in real estate in the last two years, about $3-$3.5 bn from FII. Experts say if foreign funds actually dry up the developers may hold some projects or go for expensive debt and the private equity players may also eye a bigger slice of the real estate players. "There are opportunities in the market," Paresh Chawla, Associate Director, Ernst & Young said. However, at a falling market closing deals are also getting tougher as valuations have plummeted. In one month the real estate index has tanked 45 per cent

Rupee Closes At 46.36 Against Dollar - Sep 18, 2008

After seeing a sharp decline for the last two days, the rupee rebounded against the dollar on Sept 17. The domestic currency increased by 55 paise against the greenback after the Reserve Bank of India intervened to check its fall. The rupee opened stronger at 46.35/36, but weakened to reach an intra-day low of 46.72. It recovered to close at 46.34/35, against the previous close of 46.90. In the forward market, the 6-month premium closed higher at 1.34 per cent and the 12-month ended at 1.18 per cent

Call Rate Closes Lower - Sep 18, 2008

The inter-bank call rate ended lower at 10.10-10.20 per cent, against the previous close of 11-11.50 per cent. In the one-day repo auction under the first liquidity adjustment facility (LAF), the RBI got and accepted 24 bids worth Rs 29,815 crore. There were no reverse repo bids. The Reserve Bank had declared on Sept 16 that it will conduct a second LAF daily to ease the liquidity conditions in the market till further notice. In the one-day repo auction under the se cond LAF, the RBI received and accepted 36 bids for Rs 29,665 crore. In the CBLO market, there were 342 trades totaling to Rs 16,206.55 crore in the rate range of 8.87-10 per cent.

Bond Prices Decline On RBI Move - Sep 18, 2008

Bond prices opened lower in the morning after the Reserve Bank of India permitted additional borrowing by banks, against their SLR securities, as it is tantamount to lower SLR. But prices increased later on, as the additional liquidity coming into the market was seen as positive. The RBI move effectively means that banks can keep 24 per cent SLR instead of 25 per cent. RBI is perhaps getting banks prepared for lower SLR requirement. About Rs 33,000 crore additional liquidity will come into the market, which is 1 per cent of the net demand and time liabilities of banks, as allowed by RBI. Total traded volumes on the order matching system were at Rs 5,715 crore. The 8.24 per cent-10 year-2018 paper opened at Rs 100.5 and closed at Rs 100.3, against the previous close of Rs 100.97. During day trade it touched a high of Rs 100.74 . The 8.24 per cent-19 year-2027 paper opened at Rs 96.90 and closed at Rs 96.95. During the day it touched a high of Rs 97.6

Rupee Ends At 46.05 Against Dollar - Sep 16, 2008

As news of Lehman Brothers registering for bankruptcy sent the stock markets into a churn, the rupee breached the 46- level against the dollar on Sept 15, for the first time in two years. The rupee declined by 30 paise and closed above 46, a level last seen in Sept 2006. The rupee opened at 45.52/54, but soon declined to the day''s low of 46.08. It ended at 46.04/05 against Sept 12 close of 45.74. Bond prices increased by Rs 1.34 on talks of possible rate cuts by foreign central banks, especially by US Federal Reserve after the collapse of two major banks. The 8.24 per cent-10 year-2018 paper opened at Rs 99.5 and reached an intra-day high of Rs 100.69. It closed at Rs 100.55, against the previous close of Rs 99.21

Kamal Nath To Interact With SEZ, EOU Developers On Sept 16, 2008

Income-tax exception for units in special economic zones, exclusion of sunset clause for export-oriented units (EOUs) and export duty on steel supplied to SEZs are among the issues to be talked over at the AGM of the export promotion council for EOUs and SEZs (EPCES) slated for Sept 16. The Commerce and Industry Minister, Mr Kamal Nath, will address the annual general meeting besides interacting with EOUs and SEZ developers and units. The EPCES said that about 10 key issues associating to EOUs and SEZ developers and units would be placed before the Minister at the meeting. Developers have been asking export duty exemption on supply of steel to SEZs for consumption within such zones

AP Inks Mou With UAE To Develop Hyderabad Economic City - Sep 16, 2008

The Andhra Pradesh Government has inked a memorandum of understanding with Government of Ras Al Khaimah (UAE) to develop the Hyderabad Economic City, as an integrated financial hub and health care city on the outskirts of Hyderabad. The Hyderabad Economic City project is expected with an investment of $ 5 billion (around Rs 20,000 crore). A release from the Chief Minister''s Office said that the integrated financial city component of the project will comprise infrastructure facilities for financial services operations like back office for banking, insurance and asset management companies

Vietnam To Beef Up Bilateral Trade With India - Sep 15, 2008

There is an urgent require for launching a direct flight between India and Vietnam in order to heighten trade and tourism between the two countries. Vietnam was in negotiations with Indian private airlines such as Jet Airways and Kingfisher to connect India and Vietnam by a direct flight. It could be either from Mumbai, Kolkata or any other city depending upon the feasibility. The size of bilateral trade was at $1.57 billion during the first six months between January-June 2008. Imports to Vietnam from India were at $1.45 billion, while exports from Vietnam to India was at $120 million.

Both nations had set a bilateral trade aim of $2 billion by 2010. Feed ingredients, pharmaceuticals, machinery and equipment, steel and plastic materials among others were the major items of import from India. While, coal, pepper, rubber, computer and electronic goods, cinnamon, garment and textiles formed the major exports from Vietnam. India''s investment in Vietnam was at $5.35 billion up to June 2008.

CMIE Real GDP Growth In First Quarter At 7.9pc - Sep 15, 2008

The first quarter of this fiscal saw a real GDP growth of 7.9 per cent, which is hoped to speed further in the second half, said a Centre for Monitoring Indian Economy (CMIE) report in its September monthly review. The growth rate of the agriculture, industry and services sectors in the first quarter of the current fiscal was 3 per cent, 6.9 per cent and 10 per cent, respectively, CMIE said.

However, all the sectors registered lower growth than the corresponding period a year ago with industry being hit the worst by the slowdown, CMIE said. Mining growth accelerated from 1.7 per cent in the previous year to 4.8 per cent in this year while the construction industry grew by 7.7 per cent, as against 11.4 per cent in the year-ago period. Growth in manufacturing decelerated to 5.6 per cent in the first quarter of 2008-09 from the 10.9 per cent growth registered in the first quarter of 2007-08, CMIE said

Govt To Unveil Rs 1,000cr Manufacturing Scheme - Sep 15, 2008

The Ministry of Micro, Small and Medium Enterprises (MSME) has started on an ambitious Rs 1,000 crore plan the National Manufacturing Competitiveness Programme ( NMCP). The programme will be carried out in phases during the 11th and 12th Plan 5-year Plans. Over 10 segments will be aimed in the public-private-partnership mode. The programme is hoped to boost the MSMEs across the country in primary manufacturing, retail and the service sector.

The 10 segments discovered by the MSME ministry are market support for Bar Code mechanism, support for entrepreneurial and managerial incubators, manufacturing quality tools (QMS/QTT), campaign for investment of intellectual property rights ( IPRs), lean manufacturing programme ( LEAN) under cluster development initiative ( CDI), mini tool room programme ( MTR), promotion of ICT, energy efficiency and quality certification ( ENERGY), design clinic scheme and marketing assistance to small units with technology enhancement plans

Forex Reserves Fall By $6.5 Billion - Sep 13, 2008

Forex reserves fell by $6.498 billion in the week ended September 5 owing to the dollar appreciated against other global currencies. Forex reserves declined to $288.8 billion. In the previous week, forex reserves had fallen by $1.97 billion to $295.309 billion.

In the week under review, foreign currency assets declined by $6.491 billion to $279.626 billion. Foreign currency assets expressed in dollar terms include the effect of appreciation or depreciation of non-US currencies such as euro, sterling and yen held in reserves. The week saw the euro touching a 11-month low of $1.4235, and the sterling touching a two-year low of $11.7850. The dollar sharply appreciated because crude oil dipped to $105 a barrel. The change in the currency values also impacts the RBI''s profit, as is seen from the latest annual report for 2007-2008. The balance in the Currency and Gold Revaluation Account (CGRA) as on June 30, 2008, had increased to Rs 1,63,211.83 crore, (Rs 21,723.52 crore). The increase was on account of depreciation of the dollar against other currencies and increase in the price of gold

Call Rate Closes Lower At 6.5 Per Cent - Sep 13, 2008

The inter-bank call rate closed largely lower at 6.25-6.5 per cent against the previous close of 7.75-8.25 per cent. The RBI received and accepted one bid worth Rs 200 crore in the three-day repo auction. There were no reverse repo bids. In the three-day repo auction under second liquidity adjustment facility (SLAF), the RBI received and accepted 5 bids worth Rs 14,200 crore. In the reverse repo auction under SLAF, there were 9 bids for Rs 2,185 crore. In the CBLO market, there were 458 trades amounting to Rs 24,553.05 crore in the rate range of 0.50-9.00 per cent

Bond Prices Dwindle By 54 Paise - Sep 13, 2008

Bond prices slipped by 54 paise after the auction of Rs 8,000-crore worth Government securities. The auction of Rs 5,000 crore 8.24 per cent-10 year-2018 paper and Rs 3,000 crore 7.95-24 year-2032 paper pulled the prices down, added the dealer. Total traded volumes on the order matching system were higher at Rs 7,420 crore (Rs 6, 335 crore). The 8.24 per cent-10 year-2018 paper opened at Rs 99.35 (8.33 per cent YTM) and touched an intra-day high of Rs 100.17 (8.21 per cent YTM). It closed at Rs 99.21 (8.35 per cent YTM), against the previous close of Rs 99.75 (8.27 per cent YTM). The second highly traded security, 8.24 per cent-19 year-2027 paper, opened at Rs 95.8 (8.70 per cent YTM) and closed at Rs 95.15 (8.77 per cent YTM)

Gold Slips To 8-Month Low On Global Cues - Sep 12, 2008

Gold prices touched nearly eight months low by falling Rs 295 per 10 gram in the national capital on Thursday on panic selling sparked by reports of the precious metal tumbling in the overseas markets.

In Delhi bullion market, gold fell by Rs 295 to trade at Rs 11,350 per 10 gram in evening trading, a level last seen on January 21, this year. Silver followed the same sentiments and fell to record a loss of Rs 550 at Rs 18,000 per kg.

Selling pressure gathered momentum in late trading, following reports that the gold in London fell $10.05 to $742.40 an ounce after touching $739.05, the lowest since October 10, 2007. All dollar-priced precious metals, including platinum, gold and silver declined as the dollar strengthened against currencies including the euro, diminishing the appeal of them

Rupee Falls Against Dollar - Sep 12, 2008

The rupee opened lower at 45.30/32 and fell to a two-year low of 45.57. It strengthened slightly to 45.41/42, as public sector bank sold dollars. At last, the rupee ended trade at 45.56/57, against the previous close of 45.10/11. According to a forex dealer with a private bank, public sector banks sold dollars at various levels like 45.42/44 and then at 45.55.

Foreign banks are buying dollars in the spot market and selling in the NDF market, as it offers an arbitrage of about 15 paise, said a dealer with a public sector market. The rupee is now immune to the stock market and oil prices, and is mainly tracking the global currencies. The dollar touched a one year high against the euro. In the forward premia market the six-month closed at 2.94 per cent (3.32 per cent) and the 12-month at 2.55 per cent (2.77 per cent)

Bond Prices Rise 61 Paise - Sep 12, 2008

Bond prices rose 61 paise, buoyed by expectations of lower inflation figures and comfortable liquidity in the market. Inflation stood lower at 12.10 per cent as on August 30. There was lot of buying interest in the market, as oil prices fell to $103 a barrel, said a dealer with a private bank. Total traded volumes on the order matching system were higher at Rs 6,335 crore (Rs 5,445 crore).

The 8.24 per cent-10 year-2018 paper opened at Rs 99.25 (8.35 per cent YTM) and touched an intra-day high of Rs 99.77 (8.27 per cent YTM). It closed at Rs 99.75 (8.27 per cent YTM), against the previous close of Rs 99.14 (8.37 per cent YTM). The price of the second highly traded security, 8.24 per cent-19 year-2027 paper, increased by almost Rs 2. It opened at Rs 94.2 (8.88 per cent YTM) and closed at Rs 96.04 (8.67 per cent YTM)

Core Sector Growth Slips To 4.3pc In July - Sep 11, 2008

Poor performance in the output of crude oil and finished steel during July cut down the growth of index for infrastructure industries for the month to 4.3 per cent as against 7.2 per cent in July 2007. Crude oil output registered a negative growth of (-) 3 per cent in July as against 0.9 per cent growth in the same month last year. Similarly, ended steel production grew by only 1.9 per cent compared with 10.8 per cent last year. Growth in petroleum refinery production increased by 11.8 per cent in July this year compared with 4.7 per cent in the same month last year while coal output increased by 5.5 per cent as against 1.1 per cent in the same month last year. Electricity generation during the month increased by 4.5 per cent compared with 7.5 per cent in July last year and the growth in cement output also slowed down to 8.8 per cent as against 9.4 per cent in the corresponding month of the previous fiscal

Rupee Ends At 45.11 Against Dollar - Sep 11, 2008

The rupee decreased by 26 paise against the dollar on Sept 10, to levels last seen in November 2006. It reached the psychologically important level of 45 to the dollar, on account of largescale dollar purchasing by gold and oil importers. The domestic currency opened weaker at 44.92/94, but strengthened to 44.87. It then depreciated to 45.17 before recovering marginally to close at 45.10/11, against the previous close of 44.84

Call Rates Increases Slightly - Sep 11, 2008

Inter-bank call rates ended slightly higher at 8.7-8.8 per cent against the previous close of 8.50-8.75 per cent. In the one-day reverse repo auction, the Reserve Bank of India got and accepted 12 bids for Rs 12,985 crore. There were no reverse repo auctions. In the CBLO market, there were 502 trades totaling to Rs 34,397.5 core in the rate range of 7-9.15 per cent

Call Rates Close Lower At 8.75% - Sep 10, 2008

Call rates closed lower at 8.50-8.75 per cent, against the previous close of 9.00-9.10 per cent. The RBI received and accepted 2 bids worth Rs 3,025 crore in the one-day repo auction under the liquidity adjustment facility. In the one-day reverse repo auction, the RBI received and accepted 1 bid for Rs 10 crore. In the CBLO market, there were 459 trades amounting to Rs 33,814 crore in the rate range of 7.70-9.08 per cent

India Still Top Hirer, Though Recruitment Dips - Sep 10, 2008

India retained its position as the world''s top recruiter in October-December 2007, though the level of hiring dipped when compared to the previous quarter, a survey released on Sept 9 said. The report by headhunter Manpower Inc said the employment outlook in India for October-December fell to a seasonally adjusted 43 per cent from 45 per cent in the prior quarter.

The report is based on a poll covering about 50,000 CEO across 33 countries, which were surveyed across the globe.The result is mixed. Some industry sectors seem to be experiencing the first signs of a global slowdown, Manpower India managing director Naresh Malhan said in a statement.

India''s services-heavy economy grew the slowest in over three years in the June quarter, weighed down by seven-year high interest rates and record oil prices. Growth in the services sector, which accounts for more than half of India''s output, slowed to 10 per cent in the June quarter from 11.2 per cent a year ago. Financial, insurance and real estate services growth declined to 9.3 per cent from 12.6 per cent.

Manpower''s survey showed that among financial, insurance and real estate firms, the hiring index stood at 33 per cent, 23 per centage points below the prior quarter. For services companies, it came in 11 per centage points weaker at 47 per cent. But more manufacturers are optimistic on hiring, with the sector index up 14 per centage points to 44 per cent for the quarter, according to the survey. Miners and construction firms said they expected more recruitments, with 54 per cent looking to hire, nine per centage points over the previous.Across the globe, hiring expectations in the Americas is strongest in Peru, Costa Rica and Colombia. On the other hand, employers in the US and Guatemala are the least optimistic about adding employees in the quarter ahead. Across the 17 countries surveyed in Europe, the Middle East and Africa (EMEA) region, employers in Romania, Poland, South Africa, Greece, the Netherlands, Norway and Sweden are most optimistic about hiring in the next three months while Spanish, Italian and Irish employers are the least optimistic

Bond Prices Appreciate - Sep 10, 2008

Bond prices appreciated almost 70 paise owing to falling oil prices and Dr Subbarao''s comments on inflation. There was also a lot of demand by banks for government securities to meet their SLR requirements. Total traded volumes on the order matching system were at Rs 7,980 crore (Rs 7,930 crore). The 8.24 per cent-10 year-2018 paper opened at Rs 98.42 (8.48 per cent YTM) and closed at Rs 99.03 (8.38 per cent YTM), against the previous close of Rs 98.32 (8.49 per cent YTM). The second highly traded security, 8.24 per cent-19 year-2027 paper opened at Rs 92.7 (9.05 per cent YTM) and closed at Rs 93.88 (8.92 per cent YTM)

Rupee Close A Tad - Sep 9, 2008

The rupee closed a tad against the dollar after opening stronger on Sept 8, due to strong dollar buying. The domestic currency opened at 44.35 and touched a high of 44.15, before closing at 44.60, against Friday''s close of Rs 44.73. The progress on the nuclear deal was also seen as a positive factor for the rupee, the dealer said. In the forward premia market the six month closed at 2.88 (2.83 per cent) and the 12-month at 2.6 (2.5 per cent)

Firms Want To Generate Nuclear Power - Sep 9, 2008

Forty domestic companies, including the Videocon group, Jindal Power and Tata Power, have set up a committee to convince the central government to allow private participation in generation of civilian nuclear energy. This comes in the wake of India getting a waiver from the 45-member Nuclear Suppliers Group (NSG) to carry out trade in nuclear products and technologies. However, Indian laws do not allow private companies to generate nuclear power.

The group is looking at an amendment in the law, the Atomic Energy Commission Act, which mandates only Nuclear Power Corporation of India Ltd (NPCIL) to generate power from nuclear fuels. The manufacturing sector, which has the highest weight in the Index of Industrial Production (IIP), has been growing at a slow pace of 6.6-8.8 per cent during the past five years. The share of manufacturing in the industry sector went down to 15.5 per cent last year from about 18 per cent in 1995-96

Capex Spends Likely To Come Down By 30% In FY09 - Sep 8, 2008

India Inc''s capital expenditure (capex) in the current financial year (2008-09) likely to come down almost by 30 per cent. This is to some extent the result of a fall in corporate fund-raising over the last six months and partly owing to difficulties in raising funds overseas, following the sub-prime credit crisis in the US.

According a Reserve Bank of India, India Inc''s capex will touch Rs 173,173 crore in 2008-09, significantly lower than the Rs 245,107 crore raised by companies in 2007-08.
In the last financial year, one of the key drivers of growth in capex was the Rs 442,000 crore worth of capital inflows - of which 37.1 per cent was in foreign debt, 26.9 per cent was equity market-related inflows, 14.4 per cent was net foreign direct investment and the balance 21.6 per cent in other hybrid inflows. (The reason capital inflows exceed capex is that this money may typically take a year to be allocated for investment).

But this fiscal, analysts believe capital inflows into India could drop to anywhere between Rs 132,000 crore and Rs 176,000 crore. The RBI pegs the figure at Rs 148,350 crore.Last financial year (2007-08) alone, around 648 listed firms had invested a whopping Rs 140,463 crore in fixed assets. This investment accounted for about 3 per cent of India''s gross domestic product (GDP) and 13.3 per cent of net sales of the sample companies.

The investment was top- heavy. Around 25 firms accounted for 61 per cent of the total investment. Reliance Industries topped the category with a capex spend of Rs 19,111 crore - up 131 per cent from the year before. The remaining 24 firms posted a 46 per cent rise in investment

Orissa Top Investment Spot In India - Sep 8, 2008

Orissa has emerged as the country''s number one state in terms of the total amount of investment committed, official sources said quoting a study.While the volume of envisaged projects in Orissa was Rs 5,99,181 crore, ahead of many developed provinces, including Maharashtra and Gujarat, the state also tops the list of places in terms of project implementation.Majority of investment proposals came in aluminium, airport, mines, port, energy, steel, railway and tourism, an official said, adding Orissa also led the states in project implementation as about Rs 3,08,589 crore investment was being implemented in the state.The state government also claimed that a large number of investors were in queue for putting their money in power sector

Gold Prices Continue To Decline - Sep 6, 2008

Gold and silver declined for the third day in a row on the bullion market in Mumbai on Sept 5 on persistent offerings by stockists on the back of weak global cues. Standard gold (99.5 purity) dropped further by Rs 105 per ten grams to Rs 11,605 from Rs 11,710 yesterday and pure gold (99.9 purity) fell by Rs 100 per ten grams to Rs 11,670 from Rs 11,770. Silver ready (.999 fineness) dipped by Rs 315 per kilo to Rs 20,210 from Rs 20,525 on Sept 4.

Gold prices eased in London as a strong dollar and weak oil prices pinned the yellow metal under USD 800 an ounce, although strong physical buying supported prices. Gold is often bought as an alternative asset to the dollar when the US currency is weak. Gold was also pressured by rising risk aversion, which pushed world stocks to their lowest in more than two years as fears about the slowing global economy intensified. Gold prices extended their losses for a fourth session in New York on Sept 4 as the dollar pushed higher against the Euro, prompting traders to pull money out of precious metals and other commodities

Bond Prices Closed Slightly Lower - Sep 6, 2008

Bond rates ended the day slightly lower on profit booking. Total traded volumes on the order matching system were at Rs 7,565 crore. Bond dealers said that prices increased earlier in the day as inflation eased slightly to 12.34 per cent for the week ended August 23, against the previous week''s 12.40 per cent. The decline in the price of global crude to $106.50 per barrel also aided the increase in bond prices. However, prices declined later in the day due to profit-booking.

There is no supply in the market as most banks are now holding securities in HTM (Held To Maturity) to avoid losses in a volatile market. The 8.24 per cent-10 year-2024 paper opened at Rs 98.50 and touched an intra day high of Rs 98.59. It ended the day at Rs 98.42, against the previous close at Rs 98.48. The 8.24 per cent-19 year-2027 paper opened at Rs 92 and ended at Rs 91.84, against the previous close at Rs 92.2

Forex Reserves Decline $2 B - Sep 6, 2008

The foreign exchange reserves fell by $1.97 billion to $295.309 billion for the week closed August 29, according to figures released by the Reserve Bank of India in its Weekly Supplement. The reserves were pulled down by a fall in the value of gold and fall in foreign currency assets. The fall in the value of the gold reserves was due to the decline in international gold prices. Gold prices have declined by more than $100, from $938 an ounce on July 1 to $810 an ounce on Sept 5. For the week ended August 22, foreign exchange reserves had increased by $1.076 billion to reach $297.286 billion. Foreign currency assets expressed in US dollar terms include the effect of appreciation or depreciation of non-US currencies.

Inflation Rate Drops To 12.34% On Cheaper Food Items - Sep 5, 2008

The annual Wholesale Price Index-based inflation increased 12.34 per cent during the week ended August 23, slightly below the previous week''s annual increase of 12.40 per cent due to lower prices of mainly food products, government data displayed. During the latest reported week, the WPI increased slightly to 240.3 points from 240.2 points for the previous week. The annual rate of inflation was registered at 3.94 per cent during the corresponding week a year ago. On a disaggregated basis, the Primary Articles group index fell by 0.4 per cent as the index for the Food Articles group fell by 0.8 per cent due to lower prices of fish-marine (13 per cent), fruits and vegetables (2 per cent) and jowar, arhar and urad (1 per cent each

The index for Non-Food Articles'' group increased by 0.4 per cent due to higher prices of raw silk, raw cotton and copra. However, the prices of castor seed and raw rubber fell. The annual rate of inflation, accounted on point to point basis, for Primary Articles was at 10.79 per cent for the latest reported week, as against 8.46 per cent during the previous reported week. The annual rate of inflation for the Food Articles group was registered at 6.04 per cent, way below the 7.77 per cent reported a year ago. The fuel, power, light and lubricants group index remained unchanged at its previous week''s level. The Manufactured Products group index increased by 0.2 per cent as the index for the food products group increased by 0.2 per cent due to higher prices of imported edible oil and oilcakes. However, the prices of rice bran oil and cottonseed oil and rape and mustard oil fell. For the week ended June 28, the final WPI stood revised to 238.4 points, as compared to 238.1 points calculated provisionally, and the annual rate of inflation based on final index, calculated on point to point basis, was at 12.03 per cent as compared to 11.89 per cent points reported earlier

Bond Prices Gain By 87 Paise - Sep 5, 2008

Bond prices increased by 87 paise buoyed by the massive demand for Government securities. Total traded volumes on the order matching system were considerably higher at Rs 12,555 crore. Expectation of lower inflation levels and the declining oil prices maintained the optimistic sentiment in the market. Banks are purchasing securities to meet their SLR requirements. The 8.24 per cent-10 year-2018 paper opened at Rs 97.65 and reached an intra day high of Rs 98.59. It ended at Rs 98.48, against the previous close of Rs 97.61. The price of the second highly traded security, 8.24 per cent-19 year-2027 paper, increased by Rs 2. It opened at Rs 89.91 and ended at Rs 92.2, against the previous close of Rs 90.2.

External Debt Increase 30.4pc In 2007-08 - Sep 5, 2008

India''s external debt stock at end March 2008 was at $ 221.2 billion, reflecting a 30.4 per cent increase over the previous year. Valuation change due to falling of the US dollar vis-a-vis other major international currencies calculated for almost 20 per cent of the increment in total external debt during the year, said a status report on the country''s external debt for 2007-08 released by the Finance Ministry on Sept 4.

In rupee terms, the increase in external debt during 2007-08 was lower at 19.6 per cent due to the appreciation of the rupee against the dollar. The report attributed the increase in external debt to increase in external commercial borrowing and short-term debt. Between end-March 2007 and end-March 2008, the Government debt as a proportion of total external debt fell from 28.4 per cent to 25.6 per cent and as a percentage of GDP, it fell from 5.3 per cent to 4.8 per cent.

Rupee Closes At 44.44 Against Dollar - 4 Sep 08

The rupee declined by 25 paise against the greenback on Sept 2, due to huge demand for dollar from foreign banks and oil companies. The rupee''s movement was in the range of 40 paise showing high volatility, said. The currency opened at 44.20/21 and weakened to reach an intra-day low 44.57/58. It then staged a recovery to reach an intra day high of 44.15/16 before depreciating to close at 44.43/44, against the previous close of 44.18/19. In the forward market, the 6-month premium closed lower at 2.27 per cent (2.84) and the 12-month ended at 2.27 per cent (2.58).

Sharp Increase In Bond Rates - 4 Sep 08

Bond prices increased sharply during the day as they reacted to the easing price of world crude. Total traded volumes on the order matching system were at Rs 9,775 crore (Rs 6,290 crore). Prices opened higher and rose by around 50-60 paise during the day, but profit- booking trimmed the gains of the day. Market players are, however, affirmative about inflation easing following the fall in crude rates. Liquidity is also hoped to be comfortable as bond redemptions of Rs 5,500 crore on August 8 will be balanced off by a government security auction of Rs 6,000 crore next week.

The 8.24 per cent-10 year-2018 paper opened at Rs 97.90 (8.56 per cent YTM) and increased to an intra day high of Rs 98.15 (8.52 per cent YTM). It ended the day at Rs 97.61 (8.61 per cent YTM), against the previous close at Rs 97.54 (8.61 per cent YTM). The 8.24 per cent-19 year-2027 paper opened at Rs 89.90 (9.40 per cent YTM) and closed at Rs 90.20 (9.36 per cent YTM), against the previous close at Rs 89.25 (9.48 per cent YTM).

Direct Tax Collections Up 38% In April-Aug - 4 Sep 08

Belying fears of an economic slowdown, direct tax collections have gone up by 38.3 per cent in the first five months of the current fiscal at Rs 84,409 crore, compared to Rs 61,030 crore in a year-ago period. The corporate taxes rose by 43.49 per cent to Rs 48,450 crore, against Rs 33,766 crore, while Personal Income Tax (including FBT, STT and BCTT) grew by 31.79 per cent to Rs 35,840 crore, an official release said. Amids volatility in stock markets, securities transaction tax registered a 15.10 per cent growth at Rs 2,730 crore during the period.

Fringe Benefit Tax (FBT) rose by 31.85 per cent to Rs 1,339 crore. However, Banking Cash Transaction Tax (BCTT) posted a negative growth of 21.36 per cent at Rs 274 crore against Rs 348 crore. BCTT was never taken as a revenue generating measure, but was imposed to keep a track of black money generation. Analysts said robust tax collections are expected to help the government maintain fiscal deficit at 2.5 per cent during 2008-09 despite increase in expenditure in the election year.

Finance Minister P Chidambaram has reiterated on several occasions that the Budget deficit targets would be adhered to. Among regions, tax growth in Delhi and Mumbai was 76.23 per cent and 32.49 per cent, respectively. Other regions with high tax growth are Nagpur (88.75 per cent); Kochi (58.07 per cent); Kolkata (56.82 per cent); Bhubaneshwar (53.59 per cent) and Bangaluru (48.87 per cent).

Subbarao Is New RBI Governor - 3 Sep 08

The government on Monday, 1 September 2008, appointed Finance Secretary Duvvuri Subbarao as Governor of the Reserve Bank of India (RBI) in place of Y.V. Reddy, who completes his term on 5 September 2008.

He will be the 22nd Governor of the RBI. Dr. Subbarao’s appointment will be for three years. Dr. Subbarao is an alumnus of IIT Kanpur and topper of the IAS (1972 batch).

The New Code Short And Light By Removing - 2 Sep 08

Paying tax could soon be free from the present cumbersome procedure as the government is giving final touches to the new Income Tax Code, which will be put in public domain. The new Income Tax Code will make it easier for taxpayers and professionals to understand the tax rules. The codes are almost ready and they will be out soon, a Finance Ministry official said. The new direct tax code will replace nearly five-decade- old Income Tax Act 1961 and would subsume other legislations, including Wealth Tax Act.

After a number of amendments, the Income Tax Act has become voluminous and complicated for the common man as well as professionals.The Finance Ministry has been drafting a new tax code in association with experts, the official said and added that the whole emphasis is to make the new code short and light by removing redundant provisions and complex tax jargon. The new code would first be put in public domain for comments from stakeholders and then it would be placed before Parliament for approval.Earlier, Finance Minister P Chidambaram while replying to a discussion on Finance Bill 2008 in Lok Sabha said that after the tax codes come into existence the country would move towards the system of taxation where "exemptions are few, each exemption is reviewed periodically and each exemption comes to an end after a reasonable period of time".

Bonds Increased By Around 60 Paise With Dropping Crude - 2 Sep 08

Bonds increased by around 60 paise with dropping crude prices generating a lot of purchasing interesting in the market. There was anticipation in the market that decrease in oil prices will moderate inflation. Oil prices had declined to $114 per barrel. With the Reserve Bank getting in the rupee forward contracts market, liquidity was comfortable in the system, despite the CRR hike coming into effect from August 30. Total traded volumes on the order matching system were higher at Rs 6,290 crore (Rs 5,670 crore). The 8.24 per cent-10 year-2018 paper opened at Rs 96.8 (8.73 per cent YTM) and reached an intra-day low of Rs 96.49 (8.78 per cent YTM). It closed at Rs 97.54 (8.61 per cent YTM), against the previous close of Rs 96.95 (8.71 per cent YTM). A lot of purchasing interest was also seen in the 8.24 per cent-19 year-2027 paper. The paper opened at Rs 87.74 (9.67 per cent YTM) and ended at Rs 89.25 (9.48 per cent YTM).

The Rupee Declined By Around 25 Paise - 2 Sep 08

The rupee declined by around 25 paise against the greenback on heavy dollar demand from foreign banks and importers. The domestic currency broke the psychological 44 level and opened weak at 44.08/10. It declined to 44.24/25 during the day but finally closed at 44.18/19, against the previous close at 43.93/94. The 6-month forward dollar ended at 2.84 per cent (3.36) and the 12 month closed at 2.58 per cent (2.86).

ASEAN Clinch A Free Trade Agreement For India, - 1 Sep 08

India and the Association of Southeast Asian Nations (ASEAN) have clinched a trade pact that took nearly six years of talks to finalise. This will create a new free trade area of 1.7 billion people and cover 11 countries, India and the ten ASEAN states, with a combined Gross Domestic Product of $2.3 trillion as of now. The conclusion of negotiations on the trade-in-goods agreement was announced here on Thursday, following the latest annual ASEAN-India consultations among economic ministers. The fine text will now be firmed up, and the target timeline for signature is the ASEAN-India summit in Bangkok in December. Hailing India''s trade-in-goods accord with ASEAN, Union Commerce and Industry Minister Kamal Nath and Singapore''s Trade and Industry Minister Lim Hng Kiang said here on Thursday that talks on the proposed services-and-investment pact would start soon. The target timeline for this is December 2009. Indonesian Minister Mari Pangestu said the new deal reflected a level of understanding that was never before experienced in the India-ASEAN engagement.

Western With Consumers Tightening Their Belts - 1 Sep 08

With Western consumers tightening their belts, companies still in budget-cutting mode and inflation raging, the Indian economy was bound to slow from its spectacular pace of recent times. New Delhi''s Central Statistical Office revealed Friday that India''s economic growth slowed to 7.9% annually in the April-June quarter, down from 9.2% in the second quarter last year and easing off from the previous quarter''s 8.8%. This is the first time India has recorded GDP growth lower than 8% in nine quarters, since December 2004. A downturn in the manufacturing sector braked the Indian economy. According to the government figures published Aug 29, manufacturing growth was hit the hardest, dropping to 5.6%, from 10.9% last year.

Besides manufacturers, Indian information technology companies, whose success in recent years has been grounded on India''s large population of low-wage but well-educated, English-speaking technicians, are also under threat as international banks, brokerages and other firms all started to cut their IT budgets amid the global credit crunch.

The Tamil Nadu Cabinet Cleared Ov er Rs 9,000 Crore - 1 Sep 08

The Tamil Nadu Cabinet cleared over Rs 9,000 crore worth of investment proposals in automobile and engineering sectors. Among the investment plans is Rs 4,000 crore for a tyre manufacturing unit by Michelin of France. The State Government has also determined to change some of the structured incentives extended for the Rs 4,150-crore The Cabinet, which met on Aug 30, cleared a slew of investment plans. These comprise: Rs 4,000 crore infusion by Michelin, France, for a tyre manufacturing unit in Thiruvallur to the North of Chennai; Rs 2,512-crore investment by Cethar Vessels in Tiruchi to manufacture boiler components and electricity generation equipment; Rs 1,500 crore investment by Harsha Group for oil and gas engineering equipment; Rs 350 crore project by Doosan Infracore to establish a manufacturing unit for construction equipment and components at the SIPCOT industrial estate, Pillaipakkam, in Kanchipuram District; a Rs 250-crore manufacturing unit by Delphi, USA, for making automotive electronic components; and Rs 460 crore by DCW Group for an integrated facility for caustic soda other chemicals.