*The Bombay Stock Exchange (BSE) on 30 April has launched an Islamic equity index based on the wide-measure S&P BSE 500 index, providing a new benchmark for Islamic investors in one of the world's largest stock exchanges. The new index comprises the largest 500 companies in the BSE, out of more than 5,000 listed, which fit Islamic finance principles such as bans on investing in alcohol, tobacco and gambling-related businesses. The country's first Islamic index was launched in 2010, also by the BSE, tracking the 50 largest and most liquid stocks. The Mumbai exchange had a total market capitalization of $1.32 trillion as of January 2013.In order to cater to an estimated 177 million Muslims in India, the largest Muslim minority population in the world, the industry is hoping to develop investment products that work around this requirement, but political and legal obstacles mean progress has been slow.
*World Bank on 30 April scaled down India's growth forecast to 6.1 per cent for the current fiscal from 7 per cent projected six months ago. The decline in the growth forecast is largely due to the decline in agriculture sector which is expected to grow at 2 per cent during 2013-14 against the previous estimate of 2.7 per cent despite normal monsoon projection. However, the multi-lateral funding agency said that India is regaining economic momentum and growth is expected to recover gradually to its high long-term potential. As per the latest India Development Update of the World Bank, Indian economy would grow by 6.1 per cent in 2013-14 on account of robust domestic demand, strong savings and investment rate. Growth projections for 2013-14 have been arrived at by taking into account present internal and external factors. "Economic growth is likely to accelerate to over 6 per cent during the current financial year (April 2013-March 2014). Growth is expected to increase further to 6.7 per cent in 2014-2015," said Denis Medvedev, Senior Country Economist, World Bank, India. "Recent data point to some improvements in economic activity: inflation and trade deficit came down in recent months, while private consumption and investment growth had accelerated in the third quarter of 2012-2013," he said. According to the Update, a twice-yearly report on the Indian economy and its prospects, GDP growth during 2012-13 would be around 5 per cent, lowest in the decade. As per the International Monetary Fund (IMF) report released yesterday, India's GDP is likely to improve to 5.7 per cent during year ending December 2013 and further to 6.2 per cent a year after.
*The Union Minister for Commerce, Industry and Textiles, Anand Sharma launched 21 New Textile Parks approved under Scheme for Integrated Textile Parks (SITP) in New Delhi on 23 April 2013. These new parks take the total number to 61 parks as 40 Parks were sanctioned earlier. The Scheme for Integrated Textiles Parks (SITP) has been instrumental in development of wide range of models for green field clusters from a 1000 acre FDI driven integrated cluster, to a 100 acre power loom cluster and a 20 acre handloom cluster. Under the scheme, 61 parks have been sanctioned – 40 projects were started in the 11th Five Year Plan and another 21 projects are to be implemented in the 12th Five Year Plan. Out of the 40 parks sanctioned earlier, a total of 25 Parks are already operational. Most of the balance Parks are expected to be completed during this financial year. The estimated employment generation is over 10 lac persons with total estimated investment of Rs. 27, 562 crore. Out of the 21 new parks, six are in Maharashtra, four in Rajasthan, two each in Andhra Pradesh and Tamil Nadu and one each in Uttar Pradesh, West Bengal, Tripura, Karnataka, Gujarat, Himachal Pradesh and Jammu & Kashmir. In this year’s budget speech, the Finance Minister announced an additional amount of up to Rs. 10 crores per park for setting up apparel manufacturing units for the projects under the SITP. Necessary action is being taken for implementing the announcement.
*The Minister of State for Petroleum & Natural Gas Smt. Panabaaka Lakshmi informed the Rajya Sabha in a written reply on 23 April 2013, that the recommendations of the Committee constituted under Chairmanship of Dr.C. Rangarajan, Chairman, Prime Minister’s Economic Advisory Council (EAC) are under consideration of the Government. The committee was set up to review among other things, the basis for determining price of domestically produced natural gas. She also said that under the Production Sharing Contract (PSC) regime, the current sale price of natural gas, including Coal Bed Methane (CBM), varies from a minimum of US$ 2.67 per Million British Thermal Unit (MMBTU) to a maximum of US$ 6.79 per MMBTU. The sale and pricing of natural gas under the PSC regime is governed by the relevant PSC provisions. Price of Administered Price Mechanism (APM) gas varies from $2.52 to $4.2 per MMBTU. While the price of non-APM gas varies from $4.2 to $ 5.25 per MMBTU.
*Union Tourism Minister K Chiranjeevi inaugurated the new campus of Indian Institute of Tourism and Travel Management (IITTM) at Noida on 23 April 2013. Speaking on the occasion the Minister said India has a long lived tradition of Athiti devo bhava that has been shadowed by social tensions of modern lives. He said, “We cannot promote tourism if our visitors do not trust hosts and hosts do not welcome visitors. The host community must provide the landscape for tourism. To revive the tradition of Athithi Devo Bhava; tourism students can act as the brand ambassadors and also help the host community in realizing the importance of this industry”. The new campus of IITTM is spread over 10 acres of land in Sector 62 of Noida. The campus has been constructed at a cost of Rs. 27.70 crore. Indian Institute of Tourism and Travel Management (IITTM) is an autonomous organization of the Ministry of Tourism, Government of India and is one of the premier institutes in South Asia offering education, training, research and consultancy in sustainable management of tourism, travel and other allied sectors.
*The Cabinet Committee on Investment on 22 April 2013 cleared 13 power projects that involves investment of 33000 crore rupees. The meet was headed by the Prime Minister of India, Dr. Manmohan Singh. The projects on which the investments will be made include one hydro and two thermal project as well as ten transmission projects. 25 oil and gas blocks with investment commitment of about seven billion US dollars also got approval during the same meet. Of these 16 blocks were given conditional clearances, while nine blocks were approved without any condition. Approval of these projects was pending due to the objections raised by the Ministry of Defence over national security. During the meet of Cabinet Committee on Investment in New Delhi twenty different power projects that await clearances from the Union Environment and Forest Ministry were also reviewed. The Ministry of Corporate Affairs has taken note of the misuse by certain “Chit Fund Companies” who have raised huge sums of money from the public at large. The State Governments are the appropriate authorities for regulation of such chit Fund companies/Schemes under the Chit Funds Act 1982. However, in view of the larger public interest involved in these cases, and concerns regarding misuse/laundering by such companies of the ill gotten wealth, and the possibility that the promoters of these companies may strip these companies, it has been decided by the Ministry of Corporate Affairs to set up a Special Task Force in the Serious Fraud Investigations Office (SFIO) to investigate the affairs of such companies. Accordingly, all investigations into such companies are being entrusted to SFIO with immediate effect. The Task Force will also co-ordinate with other law enforcement agencies and regulators wherever required.
*Minister of State (I/C) for Power Jyotiraditya M Scindia along with Haryana Chief Minister Bhupinder Singh Hooda on 26 April 2013 dedicated to the nation the Indira Gandhi Super Thermal Power Project at Jhajjar in Haryana. The minister lauded the efforts of NTPC, Government of Haryana and Delhi Government for making this Project a success. While addressing the gathering, Scindia said with the commissioning of this project, all the three units in the first stage is commissioned and commercial operation started. Presently, 1500 MW of power is being generated through this plant. In 2007, UPA Chairperson Sonia Gandhi laid the foundation of this Project. The project is completed with a total cost of Rs. 7900 Crore. Haryana, Delhi, and other northern region states and Union Territories will greatly benefit from this Thermal Power Project in which NTPC holds 50% share.
*The Prime Minister’s Economic Advisory Council (PMEAC) under the Chairmanship of C Rangarajan on 23 January 2013 presented the Economic review 2012-13. Some of the highlights are-
India’s economy is expected to grow 6.4 percent in the new financial year that began on 1 April 2013.
PMEAC pegged the WPI inflation at around 6 percent and food inflation, at 8 percent.
Net FDI at 18 billion dollars in FY13. FII inflows at 24 billion dollar in FY13 We expect net FDI inflow at 24 billion dollars and FII at 18 billion dollars for FY14
The fiscal deficit of the Centre for 2012-13 is estimated to be 5.2% of GDP. It was 520924 crores Rupees in 2012-13 as per revised estimates, and is expected to be 542499 crores Rupees in 2013-14 as per budget estimates.
Current Account Deficit is estimated to be 94 billion dollars (5.1% of GDP) in 2012-13 and is projected to be 100 billion dollars (4.7% of GDP) in 2013-14.
Worried over widening trade gap, the government On 27 April, has set up a six-member inter-ministerial committee under the chairmanship of Finance Secretary R S Gujral that will suggest measures to boost MSME exports. Micro, Small and Medium Enterprises (MSME) sector contributes about 40% in the country's total exports and over 8% to India's Gross Domestic Product (GDP)."The committee will suggest short and long term measures to enhance exports from MSME sector. It will submit its recommendations by mid-May," an official said. The official said there is an urgent need to look at the MSME sector as exports are not doing well due to which the country's trade deficit has touched an all-time high of $190.1 billion in 2012-13.Although the government is taking every step including recent announcement of incentives and revamping special economic zone (SEZ) policy in order to increase shipments from the country, "more needs to be done", the official added. India's exports declined by about 2% to $300.5 billion in 2012-13, way below the $360 billion targeted at the beginning of the year, due to the global demand slowdown.The widening trade gap is adding woes on the the Current Account Deficit (CAD) front, which has emerged as a tough policy challenge for the government. CAD crossed 6.7% of the GDP in the third quarter of last fiscal.As per estimates, the share of MSME exports has fallen from 40% to 36% to the country's total exports.The sector accounts for around 45% of the manufacturing output and provides employment to about 60 million persons through 26 million enterprises.
*President PranabMukherjee on 8 April, has conferred the status of 'Miniratna - Category 1' on the North Eastern Electric Power Corporation (Neepco).With this elevation to Miniratna - Category 1 status, Neepco will now be able to take certain investment decisions on its own without going through the Union power ministry. Neepco was earlier a schedule 'A' corporation.Neepco officials said the new status will facilitate expeditious execution of projects, including joint venture with public and private sector utilities in and outside the northeast. Neepco has been playing a pivotal role in the power sector of the region and has been contributing to almost 50 per cent of the power requirement of the northeast.Officials said Neepco is planning to add 2,300 MW of power in the next five years through hydro and thermal projects in order to meet the rising demand. Presently Neepco is executing five projects in the region with a total installed capacity of 917 MW, including the 600 MW Kameng Hydro Electric Projects in Arunachal Pradesh, which is expected to be on the national grid by 2016-17. The remaining four projects are exected to be commissioned by 2016.
*The Asian Development Bank (ADB), on 9 April, maintained that the Indian economy could grow at an improved rate of 6 per cent during the current fiscal, provided reforms are put in place at a faster pace to sort out the structural bottlenecks and stem the deteriorating investment situation and a strong external demand is able to facilitate a turnaround in the worsening current account deficit (CAD).In its report ‘Asian Development Outlook 2013’ released in New Delhi, the Manila-based multilateral lending agency, however, cautioned that its India projections on improvement in the economy were subject to a number of downside risks such as another bad monsoon, a slow pace of reforms and fiscal consolidation and a continued sluggishness in the global economic environment. According to ADB Country Director Narhari Rao, supply and policy obstacles have seen India’s economic growth decelerate and investment and industrial output slump, with the statistics compounded by weak global demand.
*Tata Consultancy Services (TCS), on 9 April 2013, announced that it had signed definitive agreements to acquire 100 per cent equity in Alti SA, an IT services company in France. The deal, valued at 75 million euro (around Rs.530 crore), is an all-cash transaction, TCS said in a statement. The deal is subject to customary closing conditions. Alti SA has strong expertise in IT Services, including enterprise solutions, assurance and CRM solutions. It is privately held, and owned by its management and two private equity funds, CM-CIC LBO Partners and IDI. It reported revenues of 126 million euro in 2012, and its customers include top French corporations in the banking, financial services, luxury, manufacturing and utilities sectors. Alti has 1,200 employees based in France, Belgium and Switzerland. The France IT services market is estimated at 30 billion euro. TCS has been operating there since 1992. It has over 50 clients in France and has significantly strengthened its position there.
*The Food Corporation of India (FCI) raised 5000 crore Rupees by issuing taxable bonds backed by Government of India Guarantee in order to meet the additional working capital requirement. The issue of bonds was opened on 21 March 2013 and closed on 22 March 2013. These bonds are of two tenures- 10 years (300 crore Rupees) and 15 years (4700 crore Rupees). The coupon rate for 10 years was 8.62 percent per annum and 8.80 percent per annum for 15 years. Food Corporation of India (FCI) has the Cash Credit Limit with Consortium of 62 banks. At present, the Cash Credit Limit is 54495 crore Rupees which is secured by mortgaging entire stock of FCI and guaranteed by Government of India. At present, the interest rate on Cash Credit Limit is 10.79 percent monthly which eventually translates into 11.34 on annual basis. Annual interest saving through issue of this bond will be 127.54 crore Rupees.
*The World Trade Organization (WTO) on 10 April, slashed its forecast for trade growth in 2013, saying it feared protectionism was on the increase. It cut its forecast for global trade growth in 2013 to 3.3 per cent from 4.5 per cent and said trade grew only 2 per cent in 2012.That was the smallest annual rise since records began in 1981 and the second weakest figure on record after 2009, when trade shrank.WTO Director General Pascal Lamy warned that 2013 could turn out even weaker than expected, especially because of risks from the euro crisis, and countries might try to restrict trade further in a desperate attempt to shore up domestic growth.
*The Cabinet Committee on Economic Affairs (CCEA) on 4 April 2013 decided to de-control sugar and did away the levy on sugar mills and regulated release mechanism. This de-control will raise the subsidy burden to 5300 crore rupees from previous 2700 crore rupees. De-control on sugar will not have an impact on the sugar made available in the Public Distribution System. The de-control of sugar will abolish the rule for sugar mills that makes it mandatory for sugar millers to sell sugar to the Government at a discounted price as well as the limitation on the amount they choose to sell in the open market .
*A Memorandum of Understanding (MOU) was signed on 4 April 2013, in Thiruvananthapuram, Kerala between Steel Authority of India Limited (SAIL), and Government of Kerala PSEs, Kerala State Industrial Development Corporation (KSIDC) and Kerala Minerals and Metals Ltd (KMML), for setting up a Titanium Project in Joint Venture in Kerala. The MOU was signed in the presence of the Chief Minister of Kerala, Oommen Chandy and the Minister for Industries & IT, Kerala, PK Kunhalikutty and Special Secretary & Financial Advisor of Ministry of Steel, E.K. Bharat Bhushan, and SAIL Chairman, C.S. Verma. Through this MOU, possibilities of setting up of the Titanium Project in Joint Venture in Kerala will be explored by SAIL and KSIDC& KMML, in a phased manner. To begin with in Phase 1, setting up of a Titanium Sponge and Metal Plant based on supply of Titanium Tetrachloride by KMML will be considered. In subsequent phases, backward and forward integration will be explored for ensuring long term viability of the project. This will be the another major titanium project in the state of Kerala, after the Nation’s first titanium sponge plant was put up at KMML’s Chavara complex in Kerala between KMML, Vikram Sarabhai Space Centre (VSSC) and the Defence Metallurgical Research Laboratory in the year 2011.
*Union Tourism Minister K Chiranjeevi on 3 April 2013 launched a web based Public Service Delivery System for Hotel approval and classification with a view to bring in transparency in granting approvals for hotel projects and classification status to functioning hotels. Speaking on the occasion the Minister said that with the help of this system, all applicants seeking hotel project approvals, hotel classification and approvals for other related services will be able to track the progress of their cases online on a real time basis. He said “By putting this system in place, there will be a pressure on the officers of the Ministry to deliver on time and an increased accountability on their part. Now onwards, all applications will have to be examined within 15 working days from receipt for completeness. Thereafter, all hotel inspections will be scheduled within next 15 working days. The recommendations of Hotel and Restaurants Approval & Classification Committee will be communicated on the spot to the applicant and these recommendations will also be put on web with final decision within 10 days of the inspection”. The Minister stated that in due course, the Tourism Ministry would move towards an e-regime and accept e-applications and proposals. The Ministry of Tourism will now erect such systems in other spheres of functioning also. Chiranjeevi urged his officers in the Ministry and industry to work in ‘one vision one mission’ framework Nakul Anand, President, Hotel Association of India; Vivek Nair, President, Federation of Hotels & Restaurants Association of India and Rakesh Mathur, Executive Committee Member, Heritage Hotels Association of India also spoke on the occasion and lauded the efforts of the Ministry and stated that this is a path breaking initiative taken by the Ministry of Tourism to bring transparency in its functioning. This measure will bring in more transparency, make officials more accountable in working and enable the applicants to access information and check status of their applications sitting at their own places.
*The Cabinet Committee on Economic Affairs(CCEA) on 2 April 2013 approved the proposal of the Ministry of Home Affairs for continuation of the Scheme for Special Infrastructure (SIS) in Left Wing Extremism (LWE) affected states during the 12th Plan period. The proposal includes an added objective of up gradation and critical gap filling of training infrastructure, residential infrastructure, weaponry, vehicles and any other related items pertaining to Special Forces of LWE affected states. The total cost would be 373 crore rupees comprising 280 crore rupees as central government share and 93 crore rupees as state government share on a 75 (central): 25 (state) funding pattern. The scheme will enhance the security in the region which would provide an enabling environment for development. The scheme was being implemented from the year 2008-09 with the broad objective to adequately provide for critical infrastructure requirements that are critical to the policing and security needs in the field, but are not adequately or otherwise provided for in any other scheme. During the 11th Plan period 100 percent funding was provided by the Central Government to the 9 LWE affected states for implementing various projects under the scheme. The total funds were released under the scheme by the central government to the 9 LWE affected states during the 11th Plan period is 445.82 crore rupees.
*World Bank on 30 April scaled down India's growth forecast to 6.1 per cent for the current fiscal from 7 per cent projected six months ago. The decline in the growth forecast is largely due to the decline in agriculture sector which is expected to grow at 2 per cent during 2013-14 against the previous estimate of 2.7 per cent despite normal monsoon projection. However, the multi-lateral funding agency said that India is regaining economic momentum and growth is expected to recover gradually to its high long-term potential. As per the latest India Development Update of the World Bank, Indian economy would grow by 6.1 per cent in 2013-14 on account of robust domestic demand, strong savings and investment rate. Growth projections for 2013-14 have been arrived at by taking into account present internal and external factors. "Economic growth is likely to accelerate to over 6 per cent during the current financial year (April 2013-March 2014). Growth is expected to increase further to 6.7 per cent in 2014-2015," said Denis Medvedev, Senior Country Economist, World Bank, India. "Recent data point to some improvements in economic activity: inflation and trade deficit came down in recent months, while private consumption and investment growth had accelerated in the third quarter of 2012-2013," he said. According to the Update, a twice-yearly report on the Indian economy and its prospects, GDP growth during 2012-13 would be around 5 per cent, lowest in the decade. As per the International Monetary Fund (IMF) report released yesterday, India's GDP is likely to improve to 5.7 per cent during year ending December 2013 and further to 6.2 per cent a year after.
*The Union Minister for Commerce, Industry and Textiles, Anand Sharma launched 21 New Textile Parks approved under Scheme for Integrated Textile Parks (SITP) in New Delhi on 23 April 2013. These new parks take the total number to 61 parks as 40 Parks were sanctioned earlier. The Scheme for Integrated Textiles Parks (SITP) has been instrumental in development of wide range of models for green field clusters from a 1000 acre FDI driven integrated cluster, to a 100 acre power loom cluster and a 20 acre handloom cluster. Under the scheme, 61 parks have been sanctioned – 40 projects were started in the 11th Five Year Plan and another 21 projects are to be implemented in the 12th Five Year Plan. Out of the 40 parks sanctioned earlier, a total of 25 Parks are already operational. Most of the balance Parks are expected to be completed during this financial year. The estimated employment generation is over 10 lac persons with total estimated investment of Rs. 27, 562 crore. Out of the 21 new parks, six are in Maharashtra, four in Rajasthan, two each in Andhra Pradesh and Tamil Nadu and one each in Uttar Pradesh, West Bengal, Tripura, Karnataka, Gujarat, Himachal Pradesh and Jammu & Kashmir. In this year’s budget speech, the Finance Minister announced an additional amount of up to Rs. 10 crores per park for setting up apparel manufacturing units for the projects under the SITP. Necessary action is being taken for implementing the announcement.
*The Minister of State for Petroleum & Natural Gas Smt. Panabaaka Lakshmi informed the Rajya Sabha in a written reply on 23 April 2013, that the recommendations of the Committee constituted under Chairmanship of Dr.C. Rangarajan, Chairman, Prime Minister’s Economic Advisory Council (EAC) are under consideration of the Government. The committee was set up to review among other things, the basis for determining price of domestically produced natural gas. She also said that under the Production Sharing Contract (PSC) regime, the current sale price of natural gas, including Coal Bed Methane (CBM), varies from a minimum of US$ 2.67 per Million British Thermal Unit (MMBTU) to a maximum of US$ 6.79 per MMBTU. The sale and pricing of natural gas under the PSC regime is governed by the relevant PSC provisions. Price of Administered Price Mechanism (APM) gas varies from $2.52 to $4.2 per MMBTU. While the price of non-APM gas varies from $4.2 to $ 5.25 per MMBTU.
*Union Tourism Minister K Chiranjeevi inaugurated the new campus of Indian Institute of Tourism and Travel Management (IITTM) at Noida on 23 April 2013. Speaking on the occasion the Minister said India has a long lived tradition of Athiti devo bhava that has been shadowed by social tensions of modern lives. He said, “We cannot promote tourism if our visitors do not trust hosts and hosts do not welcome visitors. The host community must provide the landscape for tourism. To revive the tradition of Athithi Devo Bhava; tourism students can act as the brand ambassadors and also help the host community in realizing the importance of this industry”. The new campus of IITTM is spread over 10 acres of land in Sector 62 of Noida. The campus has been constructed at a cost of Rs. 27.70 crore. Indian Institute of Tourism and Travel Management (IITTM) is an autonomous organization of the Ministry of Tourism, Government of India and is one of the premier institutes in South Asia offering education, training, research and consultancy in sustainable management of tourism, travel and other allied sectors.
*The Cabinet Committee on Investment on 22 April 2013 cleared 13 power projects that involves investment of 33000 crore rupees. The meet was headed by the Prime Minister of India, Dr. Manmohan Singh. The projects on which the investments will be made include one hydro and two thermal project as well as ten transmission projects. 25 oil and gas blocks with investment commitment of about seven billion US dollars also got approval during the same meet. Of these 16 blocks were given conditional clearances, while nine blocks were approved without any condition. Approval of these projects was pending due to the objections raised by the Ministry of Defence over national security. During the meet of Cabinet Committee on Investment in New Delhi twenty different power projects that await clearances from the Union Environment and Forest Ministry were also reviewed. The Ministry of Corporate Affairs has taken note of the misuse by certain “Chit Fund Companies” who have raised huge sums of money from the public at large. The State Governments are the appropriate authorities for regulation of such chit Fund companies/Schemes under the Chit Funds Act 1982. However, in view of the larger public interest involved in these cases, and concerns regarding misuse/laundering by such companies of the ill gotten wealth, and the possibility that the promoters of these companies may strip these companies, it has been decided by the Ministry of Corporate Affairs to set up a Special Task Force in the Serious Fraud Investigations Office (SFIO) to investigate the affairs of such companies. Accordingly, all investigations into such companies are being entrusted to SFIO with immediate effect. The Task Force will also co-ordinate with other law enforcement agencies and regulators wherever required.
*Minister of State (I/C) for Power Jyotiraditya M Scindia along with Haryana Chief Minister Bhupinder Singh Hooda on 26 April 2013 dedicated to the nation the Indira Gandhi Super Thermal Power Project at Jhajjar in Haryana. The minister lauded the efforts of NTPC, Government of Haryana and Delhi Government for making this Project a success. While addressing the gathering, Scindia said with the commissioning of this project, all the three units in the first stage is commissioned and commercial operation started. Presently, 1500 MW of power is being generated through this plant. In 2007, UPA Chairperson Sonia Gandhi laid the foundation of this Project. The project is completed with a total cost of Rs. 7900 Crore. Haryana, Delhi, and other northern region states and Union Territories will greatly benefit from this Thermal Power Project in which NTPC holds 50% share.
*The Prime Minister’s Economic Advisory Council (PMEAC) under the Chairmanship of C Rangarajan on 23 January 2013 presented the Economic review 2012-13. Some of the highlights are-
India’s economy is expected to grow 6.4 percent in the new financial year that began on 1 April 2013.
PMEAC pegged the WPI inflation at around 6 percent and food inflation, at 8 percent.
Net FDI at 18 billion dollars in FY13. FII inflows at 24 billion dollar in FY13 We expect net FDI inflow at 24 billion dollars and FII at 18 billion dollars for FY14
The fiscal deficit of the Centre for 2012-13 is estimated to be 5.2% of GDP. It was 520924 crores Rupees in 2012-13 as per revised estimates, and is expected to be 542499 crores Rupees in 2013-14 as per budget estimates.
Current Account Deficit is estimated to be 94 billion dollars (5.1% of GDP) in 2012-13 and is projected to be 100 billion dollars (4.7% of GDP) in 2013-14.
Worried over widening trade gap, the government On 27 April, has set up a six-member inter-ministerial committee under the chairmanship of Finance Secretary R S Gujral that will suggest measures to boost MSME exports. Micro, Small and Medium Enterprises (MSME) sector contributes about 40% in the country's total exports and over 8% to India's Gross Domestic Product (GDP)."The committee will suggest short and long term measures to enhance exports from MSME sector. It will submit its recommendations by mid-May," an official said. The official said there is an urgent need to look at the MSME sector as exports are not doing well due to which the country's trade deficit has touched an all-time high of $190.1 billion in 2012-13.Although the government is taking every step including recent announcement of incentives and revamping special economic zone (SEZ) policy in order to increase shipments from the country, "more needs to be done", the official added. India's exports declined by about 2% to $300.5 billion in 2012-13, way below the $360 billion targeted at the beginning of the year, due to the global demand slowdown.The widening trade gap is adding woes on the the Current Account Deficit (CAD) front, which has emerged as a tough policy challenge for the government. CAD crossed 6.7% of the GDP in the third quarter of last fiscal.As per estimates, the share of MSME exports has fallen from 40% to 36% to the country's total exports.The sector accounts for around 45% of the manufacturing output and provides employment to about 60 million persons through 26 million enterprises.
*President PranabMukherjee on 8 April, has conferred the status of 'Miniratna - Category 1' on the North Eastern Electric Power Corporation (Neepco).With this elevation to Miniratna - Category 1 status, Neepco will now be able to take certain investment decisions on its own without going through the Union power ministry. Neepco was earlier a schedule 'A' corporation.Neepco officials said the new status will facilitate expeditious execution of projects, including joint venture with public and private sector utilities in and outside the northeast. Neepco has been playing a pivotal role in the power sector of the region and has been contributing to almost 50 per cent of the power requirement of the northeast.Officials said Neepco is planning to add 2,300 MW of power in the next five years through hydro and thermal projects in order to meet the rising demand. Presently Neepco is executing five projects in the region with a total installed capacity of 917 MW, including the 600 MW Kameng Hydro Electric Projects in Arunachal Pradesh, which is expected to be on the national grid by 2016-17. The remaining four projects are exected to be commissioned by 2016.
*The Asian Development Bank (ADB), on 9 April, maintained that the Indian economy could grow at an improved rate of 6 per cent during the current fiscal, provided reforms are put in place at a faster pace to sort out the structural bottlenecks and stem the deteriorating investment situation and a strong external demand is able to facilitate a turnaround in the worsening current account deficit (CAD).In its report ‘Asian Development Outlook 2013’ released in New Delhi, the Manila-based multilateral lending agency, however, cautioned that its India projections on improvement in the economy were subject to a number of downside risks such as another bad monsoon, a slow pace of reforms and fiscal consolidation and a continued sluggishness in the global economic environment. According to ADB Country Director Narhari Rao, supply and policy obstacles have seen India’s economic growth decelerate and investment and industrial output slump, with the statistics compounded by weak global demand.
*Tata Consultancy Services (TCS), on 9 April 2013, announced that it had signed definitive agreements to acquire 100 per cent equity in Alti SA, an IT services company in France. The deal, valued at 75 million euro (around Rs.530 crore), is an all-cash transaction, TCS said in a statement. The deal is subject to customary closing conditions. Alti SA has strong expertise in IT Services, including enterprise solutions, assurance and CRM solutions. It is privately held, and owned by its management and two private equity funds, CM-CIC LBO Partners and IDI. It reported revenues of 126 million euro in 2012, and its customers include top French corporations in the banking, financial services, luxury, manufacturing and utilities sectors. Alti has 1,200 employees based in France, Belgium and Switzerland. The France IT services market is estimated at 30 billion euro. TCS has been operating there since 1992. It has over 50 clients in France and has significantly strengthened its position there.
*The Food Corporation of India (FCI) raised 5000 crore Rupees by issuing taxable bonds backed by Government of India Guarantee in order to meet the additional working capital requirement. The issue of bonds was opened on 21 March 2013 and closed on 22 March 2013. These bonds are of two tenures- 10 years (300 crore Rupees) and 15 years (4700 crore Rupees). The coupon rate for 10 years was 8.62 percent per annum and 8.80 percent per annum for 15 years. Food Corporation of India (FCI) has the Cash Credit Limit with Consortium of 62 banks. At present, the Cash Credit Limit is 54495 crore Rupees which is secured by mortgaging entire stock of FCI and guaranteed by Government of India. At present, the interest rate on Cash Credit Limit is 10.79 percent monthly which eventually translates into 11.34 on annual basis. Annual interest saving through issue of this bond will be 127.54 crore Rupees.
*The World Trade Organization (WTO) on 10 April, slashed its forecast for trade growth in 2013, saying it feared protectionism was on the increase. It cut its forecast for global trade growth in 2013 to 3.3 per cent from 4.5 per cent and said trade grew only 2 per cent in 2012.That was the smallest annual rise since records began in 1981 and the second weakest figure on record after 2009, when trade shrank.WTO Director General Pascal Lamy warned that 2013 could turn out even weaker than expected, especially because of risks from the euro crisis, and countries might try to restrict trade further in a desperate attempt to shore up domestic growth.
*The Cabinet Committee on Economic Affairs (CCEA) on 4 April 2013 decided to de-control sugar and did away the levy on sugar mills and regulated release mechanism. This de-control will raise the subsidy burden to 5300 crore rupees from previous 2700 crore rupees. De-control on sugar will not have an impact on the sugar made available in the Public Distribution System. The de-control of sugar will abolish the rule for sugar mills that makes it mandatory for sugar millers to sell sugar to the Government at a discounted price as well as the limitation on the amount they choose to sell in the open market .
*A Memorandum of Understanding (MOU) was signed on 4 April 2013, in Thiruvananthapuram, Kerala between Steel Authority of India Limited (SAIL), and Government of Kerala PSEs, Kerala State Industrial Development Corporation (KSIDC) and Kerala Minerals and Metals Ltd (KMML), for setting up a Titanium Project in Joint Venture in Kerala. The MOU was signed in the presence of the Chief Minister of Kerala, Oommen Chandy and the Minister for Industries & IT, Kerala, PK Kunhalikutty and Special Secretary & Financial Advisor of Ministry of Steel, E.K. Bharat Bhushan, and SAIL Chairman, C.S. Verma. Through this MOU, possibilities of setting up of the Titanium Project in Joint Venture in Kerala will be explored by SAIL and KSIDC& KMML, in a phased manner. To begin with in Phase 1, setting up of a Titanium Sponge and Metal Plant based on supply of Titanium Tetrachloride by KMML will be considered. In subsequent phases, backward and forward integration will be explored for ensuring long term viability of the project. This will be the another major titanium project in the state of Kerala, after the Nation’s first titanium sponge plant was put up at KMML’s Chavara complex in Kerala between KMML, Vikram Sarabhai Space Centre (VSSC) and the Defence Metallurgical Research Laboratory in the year 2011.
*Union Tourism Minister K Chiranjeevi on 3 April 2013 launched a web based Public Service Delivery System for Hotel approval and classification with a view to bring in transparency in granting approvals for hotel projects and classification status to functioning hotels. Speaking on the occasion the Minister said that with the help of this system, all applicants seeking hotel project approvals, hotel classification and approvals for other related services will be able to track the progress of their cases online on a real time basis. He said “By putting this system in place, there will be a pressure on the officers of the Ministry to deliver on time and an increased accountability on their part. Now onwards, all applications will have to be examined within 15 working days from receipt for completeness. Thereafter, all hotel inspections will be scheduled within next 15 working days. The recommendations of Hotel and Restaurants Approval & Classification Committee will be communicated on the spot to the applicant and these recommendations will also be put on web with final decision within 10 days of the inspection”. The Minister stated that in due course, the Tourism Ministry would move towards an e-regime and accept e-applications and proposals. The Ministry of Tourism will now erect such systems in other spheres of functioning also. Chiranjeevi urged his officers in the Ministry and industry to work in ‘one vision one mission’ framework Nakul Anand, President, Hotel Association of India; Vivek Nair, President, Federation of Hotels & Restaurants Association of India and Rakesh Mathur, Executive Committee Member, Heritage Hotels Association of India also spoke on the occasion and lauded the efforts of the Ministry and stated that this is a path breaking initiative taken by the Ministry of Tourism to bring transparency in its functioning. This measure will bring in more transparency, make officials more accountable in working and enable the applicants to access information and check status of their applications sitting at their own places.
*The Cabinet Committee on Economic Affairs(CCEA) on 2 April 2013 approved the proposal of the Ministry of Home Affairs for continuation of the Scheme for Special Infrastructure (SIS) in Left Wing Extremism (LWE) affected states during the 12th Plan period. The proposal includes an added objective of up gradation and critical gap filling of training infrastructure, residential infrastructure, weaponry, vehicles and any other related items pertaining to Special Forces of LWE affected states. The total cost would be 373 crore rupees comprising 280 crore rupees as central government share and 93 crore rupees as state government share on a 75 (central): 25 (state) funding pattern. The scheme will enhance the security in the region which would provide an enabling environment for development. The scheme was being implemented from the year 2008-09 with the broad objective to adequately provide for critical infrastructure requirements that are critical to the policing and security needs in the field, but are not adequately or otherwise provided for in any other scheme. During the 11th Plan period 100 percent funding was provided by the Central Government to the 9 LWE affected states for implementing various projects under the scheme. The total funds were released under the scheme by the central government to the 9 LWE affected states during the 11th Plan period is 445.82 crore rupees.
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