Indian Economy: News and Discussion

[Oracle]

6 ways Lodestone buy will help Infosys

Infosys seems to have finally listened to its investors and loosened its purse strings. The company has announced the acquisition of Lodestone Holding AG in a deal valued at 330 million Swiss francs (about Rs 1,932 crore). Zurich-based Lodestone advises companies on strategy and process optimisation, and provides business transformation solutions enabled by SAP's enterprise solutions.

Past few quarters have been tough for Infosys with the company cutting down its FY2012-13 dollar guidance and announcing a salary freeze. The company has been facing an increasing pressure to tweak its strategy and revive growth. Here's looking into five ways Lodestone acquisition is expected to help Infosys.

Infosys' acquisition of Lodestone is likely to result in innovation-led growth and faster transformation as it adds the latter's expertise in driving transformational change to its own vast capabilities.

Further, Lodestone's clients will get ready access to the scale and global reach of Infosys, in addition to a broad spectrum of capabilities across consulting, systems integration and outsourcing.

The acquisition will enable Infosys to increase the depth of its expertise and also help it in penetrating existing clients more, apart from getting into new accounts.

Lodestone will strengthen Infosys' consulting and systems integration (C&SI) capabilities, by bringing in more than 850 employees, including 750 experienced SAP consultants to the company.

In the financial year ended March 31, consulting accounted for 31% of the company's the $7 billion revenue.

Lodestone acquistion will give Infosy's access to the company's more than 200 clients across industries including manufacturing, automotive and life sciences. This will increase Infosys' client base from its current 700.

 

[Oracle]

Wipro eyeing investments in Omani IT market: Premji

DUBAI: Wipro is looking at making Oman its next largest strategic market in the Gulf region and is looking forward to making big investments in the country, its chairman and managing director Azim Premji has said.

During his visit to Oman, Premji said it is potentially a very important market.

"It is a good to do business here and we have made a good entry. We think we can grow very aggressively here," he told the 'Times of Oman'.

Premji met business partners and authorities during his day-long meetings in Oman, following which he left for Riyadh. "We wanted to know what the government would like us to do to be relevant to the country, apart from giving us business. We plan to establish the seriousness of our commitment to Oman. We plan to look at the presence that we have here, the presence that we are trying to build and also build on the localisation which we are doing here," he told the newspaper.

Wipro has key customers across Omani market segments including oil and gas, retail, banking, transportation among others. Wipro has been in the Middle East for the last 10 years. According to Premji said, it is perhaps the fastest growing region for the company globally.

"We have cut across most of the verticals in Oman. We feel the potential is much more than what we have tapped. We feel Oman will throw up opportunities which will be much larger than what we have been able to exploit till now. So we will continue to make investments," he said.

Wipro is looking to set up local capability in Oman which the company has already done in the UAE and Saudi Arabia. Wipro has also done a case study with a very important travel segment client in Oman, the details of which will be revealed soon.

On the Indian IT industry Premji said it will grow nicely.

"The penetration levels are low and so the head space for demand is high and Indian companies have solid cash flows. They are in a position to spend. But we have to be confident and have the right proactive solutions to be able to generate the interest to spend. India is a good market for us and we concentrate a lot on it," he said.

 

[Oracle]

Hiring activity slows down by 4% in August

MUMBAI: The hiring activity across sectors, functional areas and cities slowed down significantly last month, said a report by an online job portal. This clearly shows that employers in the country seem to be embracing a cautious approach in their hiring activity as economic uncertainties and inflationary pressures continue to weigh down their sentiment.

Key industry sectors including information technology- software, oil & gas, pharma and auto sectors have seen dipping hiring figures continuously for the last two months, according to the online job portal Naukri's job index for August.

On an overall level, after remaining flat for consecutive five months the job index has seen a 4% dip in August as compared to July.

"The overall recruitment market in the economy is very challenging and most recruiters are staffing smartly and are opting for replacement hiring instead of recruiting new members. However hiring has severely been affected in sectors like telecom, insurance and BPOs" said Hitesh Oberoi, Managing Director and CEO, Info Edge India

Most industries which had expected a steady hiring scenario in the beginning of the year, have now started witnessing dipping hiring numbers. Construction and e ngineering sectors saw the highest month on month dip with hiring activity going down by 13% on a month-on-month basis.

Oil and gas, BPO, telecom and auto saw recruitment levels dip within a range of 6% and 9% respectively over the same time period. Both software services and Insurance registered about a 2% dip in hiring activity. On the contrary, banking sector has seen a 12% growth in recruitment activities over the last month probably because of increased hiring in the public sector banks, said the report released on Monday.

All top cities have seen lower hiring numbers over the last one month, barring Kolkata which has seen a 7% increase in hiring levels. Delhi -NCR has seen a 4% dip in the job speak index in August when compared July while Mumbai, Pune and Chennai have seen their recruitment activities go down by 2% during the same time period. Bengalore and Chennai maintained steady hiring levels during the same time period.

 

[Daredevil]

Car sales fall 19% in August, first in 10 months


India:
Car sales in India fell for the first time in 10 months in August, and motorcycle sales fell for the first time since January 2009, an industry body said, as high interest rates and slowing economic growth dragged down demand.

Automakers sold 118,142 cars in August, down 18.6 percent from a year ago, according to data released on Monday by the Society of Indian Automobile Manufacturers. Weak demand was compounded by a factory shutdown at market leader Maruti Suzuki that slashed its sales by 41 percent.

Sales of motorcycles fell 8.5 percent to 766,127 vehicles. Truck and bus sales stood at 66,767 vehicles, up 3.9 percent.

 

[NSG_Blackcats]

Welspun ties up funds for 50 MW solar project The Hindu : Business / Companies : Welspun ties up funds for 50 MW solar project

Welspun Energy, on Monday, said it had secured a long-term project funding of Rs.355 crore for its 50-MW solar power project in Rajasthan. In a statement here, the company said the loan had been secured from a consortium of lenders comprising three public sector banks and one infrastructure finance firm. Welspun had, in January this year, signed a power purchase agreement (PPA) with NTPC Vidyut Vyapar Nigam Ltd., power grading arm of state-owned power producer NTPC.

The 50-MW solar project is expected to be commissioned in the first quarter of 2013, the company said. The allocation of solar PV projects in Phase-1 of Jawaharlal Nehru National Solar Mission (JNNSM) was done in two batches over two financial years — 2010-11 and 2011-12.

 

[Oracle]

Tata Motors enters Indonesia, to start local assembly in 2013

NEW DELHI: Homegrown auto major Tata Motors announced its foray into Indonesia with the setting up a wholly-owned Jakarta-based subsidiary and plans to launch its products in 2013.

The company will foray into both passenger and commercial vehicles through its arm PT Tata Motors Indonesia, the company said in a statement.

"Indonesia is a key market for Tata Motors, which has a wide range of products from small cars to buses in passenger vehicles and from 0.5T mini-trucks to 49T heavy trucks in commercial vehicles," it added.

Tata Motors is also evaluating options for setting up a manufacturing base in Indonesia to serve the country and the ASEAN region, it said, adding commercial launch and local assembly would happen in 2013.

Significant investments will also be planned for component localisation, the company said without elaborating.

Commenting on the development, Tata Motors Managing Director Karl Slym said: "As elsewhere in the world and as is the Tata practice, we will function in Indonesia as an Indonesian company...We will establish deeply rooted local operations and will grow in tandem with the prosperity of the country and its people".

On the company's product launch programme for the Indonesian market, Tata Motors Executive Director (Commercial Vehicles) Ravi Pisharody said: "Based on customer feedback, we will progressively introduce relevant passenger and commercial vehicles, backed by appropriate distribution and service infrastructure such that we are closest to our customers".

Tata Motors is also participating in the 20th Indonesia International Motor Show, starting in Jakarta on September 20. It will display 14 Tata passenger and commercial vehicles, being considered for introduction in Indonesia progressively.

The display includes a special green pavilion of Tata CNG vehicles, whose need is growing in Indonesia, it said.

By the time of the launch in 2013, PT Tata Motors Indonesia will have about 10 to 15 dealers nationwide, offering sales, service and spare parts.

"Over a period of three years, the company will set up a country-wide network of about 60 full-service dealers, about 100 other workshops and about 300 more spare parts retailers," the company added.

 

[Oracle]

Wipro, TCS, Cognizant, Infosys to hire over 5,700 in campus placement

CHENNAI: Major IT companies have hired over 5,700 students at a campus placement drive in Tamil Nadu, VIT University said.

Accenture offered 3,603 jobs in VIT University, while Bangalore-based Wipro handed over 1,308 appointment orders, the University said in a statement.

Cognizant ranked third at recruiting 803 students, it said.

According to VIT University Vice-President G V Sampath, the recruitment process consisted of screening tests and interviews.

Online portal Flipkart.com has already conducted campus placement drive offering a package of Rs 12.5 lakh, while software company DE Shaw offered Rs 14.5 lakh, the statement said.

 

[Oracle]

Hewlett-Packard layoffs to touch 29,000

SAN FRANCISCO: Hewlett-Packard is planning to cut about 2,000 more jobs than it had previously announced as CEO Meg Whitman tries to turn the company around.

In a regulatory filing Monday, the computer and printer maker said it will eliminate 29,000 jobs by October 2014, up from the 27,000 cuts it announced in May when HP employed about 350,000 people.

The company, which is based in Palo Alto, California, didn't explain why it had raised the number. The revision comes amid signs that the already slumping personal computer market may weaken even further as an increasing number of sleek smartphones and tablet computers win over consumers.

The shift to mobile devices has hurt HP, the world's largest maker of PCs. HP is preparing to release a new line of tablets this fall and has been trying to diversify into more profitable lines of technology, such as business software and consulting, but Whitman has cautioned it will take several years for the company to bounce back from a litany of problems, including a lack of innovation and acquisitions that haven't panned out.

For instance, the diminished value of HP's 2008 acquisition of consulting service Electronic Data Systems saddled the company with an $8.9 billion loss in its most recent quarter.

About 8,500 workers already have accepted early retirement offers. Most of those employees left HP August 31, according to Monday's filing. The rest of the early retirees will depart by the end of August 2013.

ISI Group analyst Brian Marshall estimated that HP will save an additional $200 million annually by cutting an extra 2,000 jobs. In May, the company had estimated its austerity drive would reduce its annual expenses by $3 billion to $3.5 billion.

The company expects to record charges totaling $3.7 billion to cover the costs of paying departing workers and other cost-cutting measures. That's up from the May estimate of $3.5 billion. HP absorbed $1.7 billion of the projected charges in its last fiscal quarter ending in July.

The company's stock price rose 14 cents to close at $17.43 Monday. The shares are still close to their eight-year low of $16.77, hit August 30.

 

[Oracle]

Tata Chemicals to set up urea plant in Tripura

Agartala, Sept 11 (IANS): Tata Chemicals will set up a Rs 5,000-crore, gas-based urea plant in North Tripura in association with State-owned ONGC and Tripura government, officials said here on Tuesday.
ONGC Chairman Sudhir Vasudeva held a meeting with Chief Minister Manik Sarkar in New Delhi on Monday and discussed the matter.

"The ONGC CMD informed the Chief Minister that the Tata Chemicals has been chosen as the private partner to set up the fertilizer project in northern Tripura," a State Industry Department official told reporters.

The official said ONGC had initiated the process to set up the fertiliser plant to meet the growing shortage of urea, the commonly used soil manure in the northeastern region.

Tata Chemicals is the market leader in the urea and phosphatic fertiliser segments.

ONGC had earlier sought expression of interest (EoI) from companies with relevant experience and track record to be a partner in the proposed gas-based fertilizer plant.

According to an ONGC official, six Indian firms, including government-owned, were keen to participate in the first gas-based fertiliser plant of ONGC.

According to union Minister of State for Petroleum and Natural Gas RPN Singh, it would take around 44-48 months to set up the plant.

 

[Apollyon]

Wipro, TCS, Cognizant, Infosys to hire over 5,700 in campus placement

CHENNAI: Major IT companies have hired over 5,700 students at a campus placement drive in Tamil Nadu, VIT University said.

Accenture offered 3,603 jobs in VIT University, while Bangalore-based Wipro handed over 1,308 appointment orders, the University said in a statement.

Cognizant ranked third at recruiting 803 students, it said.

Most of these will be kicked out or will kick out during training period ...

 

[Oracle]

Walmart plans 3-5 more India wholesale stores

BANGALORE: A cash and carry joint venture between Wal-Mart Stores (WMT.N) and Bharti Enterprises plans to add 3-5 stores by end of the year, a spokeswoman for the world's largest retailer said on Tuesday.

US group Walmart operates 17 cash and carry, or wholesale stores, in India in partnership with Bharti Enterprises, which owns India's top mobile telecoms operator Bharti Airtel Ltd (BRTI.NS).

Foreign ownership regulations in India do not allow global hypermarket and supermarket chains such as Wal-Mart Stores Inc (WMT.N) and Carrefour SA (CARR.PA) to set up shops in the country and tap the over $450 billion retail market.

Foreign players are, however, allowed to operate wholesale stores.

In December last year, the government backtracked on its decision to allow such chains to own 51 percent in India's multi-brand retail sector after a huge political backlash.

Walmart also plans to ramp up the headcount at its unit, @WalmartLabs, in Bangalore to about 200 by end 2012 from 125 now, Jermey King, Chief technical Officer of Global e-Commerce, Walmart.com, told reporters.

The unit's job is to help Wal-Mart capture more online sales from the proliferation of smartphones and social networking.

 

[blank_quest]

FDI Policy on Multi Brand Retail Trading and India's Commitments under International Investment Agreements

"¢ Broadly two types of commitments are undertaken in an international investment agreement i.e. market access and national treatment.

"¢ FDI policy is amenable to both market access and national treatment issues

 Market access in the context of FDI policy implies the ability of a foreign investor to enter the investment space in India and the limitations thereon. For example, a foreign multi brand retail investor can invest in India only after the government decision is notified. Thus, access to the Indian market for multi brand retail is blocked for foreign investment till then.

 National treatment implies that a domestic and foreign investor are treated equally. The FDI policy itself envisages unequal treatment in a range of sectors which is embodied in the sectoral caps, security restrictions, etc. This means, for example, that while an Indian investor can invest 100% in multi brand retail trading in India, a foreign investor will still be allowed to invest only 51%. Further, all the attendant conditions of the policy have only to be complied with by the foreign investor and not an Indian investor setting up a multi brand store without foreign investment.

"¢ BIPA: The BIPA is a post-establishment investment agreement. This implies that once an investor enters the country, that investor must be treated the same as a domestic investor unless the limitations to national treatment are clearly spelt out at the pre-establishment stage. The FDI policy is a pre-establishment instrument and therefore not covered by BIPA.

"¢ CECA/CEPA: In these agreements, India has taken both pre and post establishment commitments. In the pre-establishment commitments, the FDI policy has been bound which means that any rollback would require consultations with the partner country and could entail quid pro quo in terms of concessions in some other area. Within the FDI policy, commitments may be taken only in some specified sectors (positive listing). Since FDI in multi brand retail trading was not allowed when these agreements were negotiated, none of these agreements is affected by the recently approved policy. Moreover, state and local regulations are not a part of the commitments.

"¢ Multilateral/WTO: Multi brand retail trading is classified as a service and therefore covered by the General Agreement on Trade in Services (GATS). India has not undertaken any commitments in this area under the GATS. As such, there is no impact of the policy on our commitments under the WTO. Investment is not a part of WTO disciplines except through Mode 3 under GATS.

"¢ The recently approved policy on FDI in multi brand retail trading provides, inter-alia, that it would be the prerogative of the states to allow a multi brand store. The policy nowhere provides that it is applicable only to certain states. The policy itself is a national policy and can potentially be applicable to all the states that are desirous of implementing it. The local and state-level regulations which govern shops and establishments are the prerogative of the respective state governments. The policy explicitly acknowledges this position. The opening up of FDI in multi brand retail trading is a liberalization measure and remains so with all the conditionalities, given the fact that currently FDI in multi brand retail trading is not allowed at all in India. The decision does not violate any commitments/obligations arising out of India's international agreements.

**********

 

[Apollyon]

Rupee may come back to 44-45 levels if reforms are implemented: G Chokkalingam, Centrum Wealth Management

ET Now: Looking at the markets today and considering what happened in Delhi, are you worried about the government's inability to push through further reforms?

G Chokkalingam: We are not at all worried; rather we continue to view this as a great opportunity. We firmly believe that the present government will continue till early 2014 because the number is advantageous to them. It will be very difficult for the opposition to pull down the government. Secondly, if TMC is out of the coalition and there is a possibility of either SP or BSP coming to the UPA government, it would have a major impact on both the economy and the market. Both SP and BSP have better tally in Rajya Sabha as well as in the Lok Sabha. Rajya Sabha support is very crucial for passing the two major key reform bills, namely the banking bill and the insurance bill. Therefore, if the UPA government gets the support of one of these two parties, there is a likelihood that these two bills can be passed in the winter session of Parliament, which would act as a big trigger for the markets. So, we remain positive and we are using today's opportunity to accumulate more stocks.

ET Now: Is the market still worried, because it is down despite a lot of positive cues coming in from elsewhere?

G Chokkalingam: Sometimes the market is right and sometimes it is wrong, and this time the market is wrong. We are not particularly worried because if you look at the past episodes where the minority government lost key allies, the reaction of the market was deadly. If you see in relative terms, I am very comfortable that the current fall is not even 1% of that, which gives a lot of comfort to go overboard on the market.

ET Now: Given that we have all of this negative news on the political arena, it certainly raises a lot of questions as to whether the government can meet some of the current announcements. Let us talk about the pocket that will be affected -- the retail space, aviation and media segments. What would you make of these three pockets?

G Chokkalingam: I do not think the government has a choice to go back on its words for the simple reason that we are in a very unique disadvantageous position as far as certain economic parameters are concerned. We have withdrawn $13 billion from the forex reserves in FY12, the FDI is down by 67% on YoY basis in Q1 and the exports are de-growing to the extent of 10% to 15%. Moreover, the RBI has exhausted $78 billion, which it purchased in FY2008, to provide support to the rupee. Therefore, I do not think the government has any choice to go back. They will have to stick to their words and take a short-term political risk to get long-term political gains. Taking into consideration these facts, I firmly believe that the Congress government will go ahead with the reforms irrespective of what happens with the TMC.

ET Now: You said that you remain optimistic on the government being able to push ahead with reforms. You also said that you are actually taking advantage of events such as what we are seeing today to accumulate positions. Where are you accumulating positions?

G Chokkalingam: We have opted for aggressive sectors like banks, particularly the private banks, and capital goods. We are also accumulating in the resource sector because despite the meltdown in the metal space, the input supply to the metal sectors is quite well. As a thematic play, we are also focusing on the import substitutes or the large importers because our strong conviction is that the rupee would appreciate -- it would at least go back to 52 before December this year. Once all these reforms are implemented, the rupee would come back to 44-45 levels within a year's time.

ET Now: Would you say that you are optimistic enough to be unwinding positions in the defensive sector and getting into many of the other sectors that people have been ignoring for so long?

G Chokkalingam: One should continue to hold defensive play, and investors should not offload their defensive sector -- particularly FMCG stocks like ITCBSE 0.92 %. Pharma is another sector where the investors should not make an exit as it is one of the fastest-growing sectors in the current environment.

 

[blank_quest]

Press Information Bureau
Government of India
Ministry of Commerce & Industry
21-September-2012 15:46 IST
Joint Statement of the 7th Round of talks on Commercial and Economic Co-Operation between Commerce Secretaries of India and Pakistan
The 7th round of India-Pakistan talks on Commercial and Economic Co-operation was held during 20-21 September 2012 at Islamabad between the Commerce Secretaries of India and Pakistan.

2. The Indian delegation was led by Mr. S R Rao, Commerce Secretary and Pakistan's was led by Mr. Munir Qureshi, Secretary, Commerce.

3. Both sides expressed satisfaction with the progress made in the bilateral trade relationship, since last round of talks in New Delhi (14-16 November 2011). The bilateral meetings and discussions of the Trade and Commerce Ministers of both countries (September-2011, February-2012 and April-2012) provided a strong political impetus to enhanced economic engagement. The transition towards full normalization of trade relations with India was initiated by moving from a 'positive list' regime to a 'negative list' regime. Following the visit of Commerce Minister Shri Anand Sharma to Pakistan in February 2012, Pakistan side notified its negative list on 20th March 2012. The understanding at the previous Ministerial level talks has been that after approval by the Cabinet this negative list would be dismantled before the end of 2012.

4. The Commerce Secretaries reviewed with satisfaction that Commerce Ministers of India and Pakistan as well as the Chief Ministers of Punjab on either side of the border had jointly participated (April, 2012) in the Inauguration Ceremony of the new Integrated Check Post (ICP) at Attari. Commerce Secretaries appreciated that better trading opportunities provided through land route would enhance mutual prosperity of the business communities and consumers of both sides of the border. They however, noted that there is need to further strengthen infrastructure on both sides. They directed the customs and the port authorities to resolve all the issues through mutual cooperation, harmonization of customs procedures, provision of laboratory facilities, scanners, weigh bridges, cold houses, containerized services and automation of the business processes. For this purpose, meetings of the Customs Liason Border Committee would be held on monthly basis. CLBC would also explore the possibilities of organizing meetings between the relevant importers and exporters at Wagah-Attari border. It was decided that this Land Customs Station would operate seven days a week.

5. The need for more trade traffic to be carried through the Railways was emphasized. For this purpose, it was agreed that the Railway Ministries would hold joint coordination meetings on a monthly basis, at the appropriate levels. Issues on availability of sufficient number of rakes for interchange was also highlighted by the Pakistan Railways. It was noted that the earlier agreed provision of 3-4 interchanges a day has not been adhered to due to current trade patterns. A viable solution is to allow High Capacity Wagons (HCW) from Pakistan which carry three times more load than the regular wagons. The Indian Railways agreed that specifications already provided by the Pakistan Railways for HCW would be examined and conveyed accordingly within two months.

6. On exploring the possibilities of opening new land routes for trade, Pakistan side informed that a working group on Munabhao-Khokhrapar has been constituted. Indian side has already conveyed constitution of working group. It was agreed that meeting of the JWG on Munabhao-Khokhrapar would be held in 4th week of October, 2012 at New Delhi.

7. Both sides appreciated the recent signing (September, 2012) of the new liberalized bilateral visa regime. This fulfils a long pending demand of the business communities of both sides to ensure a better enabling environment for bilateral trade.

8. Pakistan side also appreciated the recent measures which have been taken by India to remove its earlier restrictions on inbound and outbound investments to Pakistan. Pakistan side sought clarifications from Indian authorities on investment through "Government Route" and its implications for investment by Pakistani investors in India. Both sides agreed to encourage two way investment and to enhance investor confidence on both sides, the procedures need to be simplified. It was also decided that outreach programmes may be held with the business communities on both sides, regarding the new investment opportunities, application procedures and regulatory issues.

9. On the issues relating to removal of Non-Tariff Barriers, Secretary Commerce Pakistan highlighted that certifications/ licensing/ lab testing/ are not the only NTBs but issues like delays in customs clearance, non availability of railway wagons for cargo transport, absence of direct flights or any problem which delays the clearance of goods with no end results or change, faced by importer/exporter is an NTB. He reiterated that concrete solutions of all such issues are crucial for ensuring market access in the Indian markets for Pakistani exporters. Commerce Secretary India while noting the views expressed by Commerce Secretary Pakistan, emphasized the need for elimination of such NTBs on both sides. Both sides expressed satisfaction on signing of the three agreements i.e. Redressal of trade grievances agreement, Mutual Recognition Agreement and Customs Cooperation Agreement and directed the relevant authorities to frame rules and procedures to fully implement these agreements. These agreements are expected to substantially facilitate bilateral trade mechanisms. It was agreed that on the same pattern as Mutual Recognition Agreement between BIS and PSQCA, another agreement between Export Inspection Council of India (EIC) and PSQCA will be signed. Both sides have already exchanged the draft texts and it was agreed to complete the internal approvals before the next meeting of the Commerce Secretaries.

10. The JWG on Customs Matters has held one meeting in August 2011. In order to frame rules and procedures to implement the two agreements signed between the Customs Authorities, it was agreed that JWG on Customs would meet in the following month either at Karachi or Mumbai.

11. It was reiterated that the road map drawn in the earlier Ministerial meetings, for liberalized and preferential trade regimes would be scrupulously adhered to. Pakistan side informed that summary for removal of restrictions on trade through land route has been moved to the Cabinet and assured that decision to this effect is expected to be notified before end of October, 2012.

12. The Pakistan side expressed appreciation of the steps taken by India to reduce its SAFTA sensitive list by 30% from 878 tariff lines to 614 tariff lines as agreed earlier during the 6th Round of Talks. The Indian side explained that out of 264 tariff lines which have been removed from India's SAFTA sensitive list, 155 tariff lines pertain to agricultural commodities and 106 tariff lines relate to textile items. To further deepen the preferential arrangements under SAFTA and to provide level playing field to Pakistani exporters in comparison to concessions allowed by India under SAFTA to rest of the countries in the SAARC region, both sides developed a long term plan. It was noted that Pakistan now has a total of 936 tariff lines at 6 digit under its SAFTA Sensitive List, as against 614 tariff lines at 6 digit of India. It was agreed that after Pakistan has notified its removal of all restrictions on trade by Wagah-Attari land route, the Indian side would bring down its SAFTA sensitive list by 30% before December, 2012 keeping in view Pakistan's export interests . Pakistan would transition fully to MFN (non discriminatory) status for India by December 2012 as agreed earlier. India would thereafter bring down its SAFTA Sensitive List to 100 tariff lines at 6 digit level by April, 2013. As India notifies the reduced Sensitive List, Pakistan, after seeking approval of the Cabinet, will also simultaneously notify its dates of transition to bring down its SAFTA sensitive list to a maximum of 100 tariff lines at 6 digit level within next 5 years. The reductions shall be notified by Pakistan in equal measure for each year so as to complete reduction to 100 lines before end of 2017. Thus, before the end of 2017, both India and Pakistan would have no more than 100 (6 digit) tariff lines in their respective SAFTA sensitive lists. Before the end of year 2020, except for this small number of tariff lines under respective SAFTA sensitive lists, the peak tariff rate for all other tariff lines would not be more than 5%.

13. The Commerce Secretaries also reviewed the progress on other issues such as enhanced trade for petroleum products, trade in power and reciprocal opening of Bank branches. Based on this review, the Commerce Secretaries exhorted the relevant stakeholders on both sides to speed up the mutual consultations so that concrete progress is achieved within the next six months. During this review, Indian side informed its willingness to consider export of gas up to 5 million cubic metres per day, for an initial period of five years. Pakistan side informed that India's offer has been received and is under active consideration. BHEL (an Indian PSU) made an offer to cooperate with the Pakistan side in setting up 500 – 2000 MW capacity in coal/hydro or Gas power plants, as per their requirements. Indian side indicated its willingness to cooperate with Pakistan in areas of wind and solar energy. Indian side also made an offer for meeting the requirements of Pakistan Railways for up to 100 locomotives.

14. Pakistan side emphasized the importance of taking SMEs along in this trade normalization process. It highlighted that sectors like surgical instruments, cutlery, fans, leather and marble products have a huge potential for trade. It was agreed that an institutional mechanism would be constituted to work out exhibitions of these products in India. Sharing of technology, skill development, training and collaboration in development of designs would also be encouraged. Cooperation in the manufacturing activities of the Gems and Jewellery sector would be actively encouraged.

15. As a part of this round of talks, representatives of the Civil Aviation Authorities of both the countries undertook discussions to ensure better air connectivity between New Delhi and Islamabad. It was noted that against an average of about 23 flights per week between New Delhi and other important national capitals of the SAARC countries, there is as yet no direct air connectivity between New Delhi and Islamabad. It was agreed that a Joint Working Group (JWG) would be formed before 15th November 2012, which would work out a more liberalized regime of reciprocal bilateral rights for commercial flights, to ensure economic viability of this air route. This JWG would also explore mechanisms for more efficient courier services.

16. The two sides noted with satisfaction the business-to-business contact which is steadily growing between both countries. Chambers of Commerce on either side have been supporting business delegations and trade issues in each other's countries. This process would be supported and facilitated by the Commerce Ministries of both the countries, with the active support of the TDAP and ITPO. The Secretaries directed the two organizations to provide better guidance to chambers and business people on customs procedures, import regulations and how to organize exhibitions.

17. The Commerce Secretaries also noted the decision that was taken by the Commerce Ministers to form a Joint Business Council (JBC) as an additional institutional framework for regular and sustained dialogue between the business communities. Both sides agreed to exchange names of 10 prominent business persons from each country for this JBC within a month. The endeavour would be to have a first meeting of this JBC before December 2012 and its recommendations would be duly considered for taking forward the ongoing trade and investment dialogue. The JBC would, inter-alia, also explore measures for increasing other related activities between the people of both countries.

18. Preliminary discussions were also held on possibilities of better telecommunication linkages keeping in view the requirements of business communities on both sides for international roaming facilities. It was agreed that separate sub-groups on either side would take forward this dialogue. Commerce Secretaries would review thereafter.

19. Both sides also reviewed the earlier discussed possibilities of greater trade cooperation in sectors of agriculture and information technology. Relevant stake-holders would be encouraged to take forward economic cooperation in these areas. Cooperation for increasing cotton yield in Pakistan through trials of suitable Bt cotton seeds, would be given more focused attention

20. The Commerce Secretaries of both countries placed on record appreciation of their predecessors Dr. Rahul Khullar and Mr. Zafar Mahmood, who had very ably steered the trade dialogue from April 2011 onwards. It was resolved to further build upon the foundations laid by them to consolidate and enhance economic engagement.

21. The 8th round of talks would be scheduled to take place in India in April 2013. In the meantime co chairs of the JWG on economic and commercial cooperation, Joint Secretaries of Commerce, India and Pakistan would meet in December, 2012 at Islamabad.

22. The bilateral trade talks were conducted in a very cordial and positive atmosphere.

*********

http://pib.nic.in/newsite/erelease.aspx?relid=87887

 

[cloud_9]

ONGC-IOC-OIL bid $5 billion for ConocoPhillips' assets

NEW DELHI: State-owned Oil and Natural Gas Corp (ONGC), Indian Oil (IOC) and Oil India (OIL) have made a joint bid of about $5 billion for buying stake in six Canadian oil sands assets of US energy giant ConocoPhillips.

"We had a few weeks back placed a non-binding bid for a stake in the six Alberta properties of ConocoPhillips ," a top source at one of the three state-owned firms said.

Houston-based ConocoPhillips has since then closed bidding for selling as much as 50 per cent of its oil-sand reserves in Alberta.

"There are some producing assets and some exploration assets on offer," he said without giving more details.

ONGC Videsh Ltd, the overseas arm of the state explorer, had earlier this month bought US energy firm Hess Corp's stake in Azeri, Chirag and Guneshli (AGC) group of oil fields in Azerbaijan for $1 billion.

ConocoPhillips has hired Scotia Waterous for selling stake in six Alberta properties that produce about 25,000 barrels of oil per day from an estimated 30 billion barrels of bitumen in place. Development of these reserves could increase production to more than 500,000 bpd.

 

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Exports decline 9.74% in August

NEW DELHI, OCT. 1: Exports declined by 9.74 per cent year-on-year to $22.3 billion in August due to the global economic slowdown.

During April-August, shipments dipped by 5.96 per cent to $119.97 billion from $127.5 billion in the same period last year, according to data released by the Commerce Ministry today.

Imports during the month, too, slipped by 5.08 per cent to $37.9 billion, leaving a trade deficit of $15.7 billion.

During the first five months of the current fiscal, imports contracted by 6.2 per cent to $191.1 billion, with the trade deficit at $71 billion during this period.

Oil imports during August were 2.96 per cent higher at $12.88 billion, compared to $12.51 billion in the year-ago period.

Oil imports during April-August were valued at $66.7 billion, up 2.80 per cent as against $64.88 billion in the corresponding period last year.

Meanwhile, non-oil imports during August were estimated at $25.1 million, down 8.74 per cent from last year.

Non-oil imports during April-August stood at $124.46 billion, 10.41 per cent lower as compared to the same period last year when it stood at $138.92 billion.

India's manufacturing growth held steady in September: HSBC survey

NEW DELHI, OCT. 1: India's manufacturing sector "held steady" in the month of September supported by faster output growth and rising export orders, an HSBC survey said.

The HSBC India Manufacturing Purchasing Managers' Index (PMI) — a measure of factory production — stood at 52.8 in September, the same as in August.

The September reading of HSBC PMI points to a significant improvement in the health of the manufacturing space as the sector witnessed the weakest growth rate in nine months in August.

The index has remained above the 50-mark, below which it indicates contraction, for more than three years now.

"Economic activity in the manufacturing sector held steady supported by faster output growth and rising export orders. However, a rise in inventories may dampen output growth in the coming months," the HSBC Chief Economist for India and the ASEAN Leif Eskesen said.

Going forward, output growth is likely to "dampen" as post-production inventories or stocks of finished goods have increased significantly, marking an 11-month sequence of accumulation as manufacturing firms are expecting a boost in demand in the future.

"Looking ahead, growth in the manufacturing sector is likely to remain subdued, although implementation of recently announced reforms will help facilitate a gradual recovery during the second half of the fiscal year," Eskesen said.

The Government has taken a number of reform initiatives such as opening the multi-brand retail sector to FDI, hiking diesel prices by over Rs 5 a litre, capping the number of subsidised LPG cylinders to six per family a year, allowing foreign carriers to pick up stake in domestic airlines and liberalising FDI rules for broadcasting sector.

The inflation picture was a bit "mixed", HSBC said as output prices rose somewhat less, but input prices rose at a faster clip on the back of higher raw material and diesel prices.

Retail inflation in August stood at 10.03 per cent, according to official data.

On the employment front, job creation was recorded in September, the seventh successive month of growth. Payroll numbers increased to meet stronger demand, with some signalling expansions in marketing departments, however, the pace of hiring eased a bit.

Meanwhile, power shortages continued to affect backlogs of work, which rose at a solid pace during the month, HSBC said.

 

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Double Post

 

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[PDF]http://webapi.prosperity.com/download/pdf/INDIA_356.pdf[/PDF]

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Coca-Cola set to invest $2 bn in India over 5 years

Coca-Cola India on Monday announced plans to invest $2 billion (around Rs 10,000 crore) over next five years in India to ramp up its business capabilities as it prepares to gear up for increased business opportunities. Coca-Cola India is a 100% subsidiary of Atlanta-based The Coca-Cola

The investments are a part of the company's 2020 Vision wherein it plans to double its revenue. The current phase of investment is also a part of the its plans to invest $30 billion (Rs 1,50,000 crore) globally over the next five years to support anticipated growth across its system.
"We plan to ramp up our manufacturing capabilities, establish new bottling lines and procure new cold chain equipment among others," said Atul Singh, president and CEO, Coca-Cola India and South West Asia. Singh refused to divulge about how much of the said investment would come under foreign direct investment. "A chunk of this investment will also come from our Indian bottling partners."

A part of this planned investment will go toward setting up a company-owned manufacturing plant. The company at present is scouting for locations in Karnataka to establish a new manufacturing facility.
Singh said that the company is also preparing a roadmap for strategic investments in rural markets, wherein it is pilot-testing solar coolers, which would keep beverages cool in rural areas with erratic electricity supply.
India's per capita consumption of Coca-Cola beverages ranks much below other countries such as China. It produces popular beverage products such as Coca-Cola and Thums Up, among several others.

Coca-Cola set to invest $2 bn in India over 5 years - Hindustan Times
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How Coca-Cola’s low-cost solar cooler is helping Coke spread its wing in villages - The Economic Times

Excerpts:

As the first rays of the winter sun hit the small solar panels perched on the roof of Roop Devi's kirana store in a remote village in Bareilly, Uttar Pradesh, a direct current compressor motor whirrs into life. It refrigerates a small, opaque, boxstyled cooler inside her shop. A few hours later Devi opens the box and makes her first sale — an ice-cold bottle of Coke.

It's just another Coke sold, except that the sale has been made in a village that doesn't have any electricity. As the thirsty villager gulps down the fizzy chill gushing out of the bottle, Coca-Cola India moves another step closer to prying open the market in 80,000 Indian villages that do not have any electricity. Of these, 25,000 have little chance of being connected to the power grid in the conventional way.

Coca-Cola India first toyed with the idea of a low-cost solar powered cooler when its president and CEO Atul Singh visited a rural market in Uttar Pradesh in the summer of 2009. Shops there served him warm Coke. When Singh returned, he charged two young Coke engineers, Chandan Samanta and Sunil Gulati, now aged 35 and 40, respectively, with the task of figuring out a low-cost solution.

The light keeps her business going till late in the night. Customers often walk in to plug their mobile phones into the cooler to charge-up the battery.

"I no longer need to shut shop just because it is sunset," says Devi. The light facilitates longer hours, helping her earn more income. "When people line up to use the mobile charger, they stay longer and buy more food and beverages while they wait," she adds.

Coca Cola India collaborated with Mumbai-based Western Refrigeration to create the eKOCool solar cooler. The boxes are now also exported to Africa, New Papua Guinea as well as South Africa. In Turkey these boxes are being mounted on trolleys to ferry these bottles on sea beaches.

 

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IKEA closer to setting up shop with nod for Rs 10,500-cr investment​

NEW DELHI, NOV. 20: Swedish furniture giant IKEA's proposal to pump Rs 10,500 crore into the furniture retailing business crossed yet another hurdle on Tuesday when the Foreign Investment Promotion Board (FIPB) approved the investment plan.

Even as IKEA gets closer to selling its line of self-assembly furniture to Indian consumers through its own retail outlets in the country, the FIPB decision signalled a concrete step forward on opening up the retail trade and pushing up dwindling foreign direct investments.

FINAL VETTING

Economic Affairs Secretary Arvind Mayaram confirmed the development after the meeting of the nodal agency for foreign investment approvals.

IKEA's proposal, one of the largest FDIs in single-brand retail trade, will now head to the Cabinet Committee on Economic Affairs for final vetting as the FIPB can clear investment applications worth up to Rs 1,200 crore only.

PLANS FOR 25 STORES

IKEA is the second foreign retailer after UK-based footwear company Pavers England to get FIPB approval to set up wholly-owned stores in India.

IKEA had approached FIPB in June this year seeking permission to set up 25 stores in India.

IKEA, which sells everything from bottle openers to furniture, will be investing in India through its 100 per cent subsidiary, Ingka Holding Overseas B.V.

The retailer had earlier voiced concern about the sourcing clause but chose to go ahead with the investment after the Government relaxed the clause on 30 per cent sourcing from small and medium enterprises. IKEA currently sources products worth $450 million from Indian exporters. The Government, as part of its big-bang reforms, had also allowed opening up of multi brand retail trade. This gave an impetus to the plans of retailers such as Wal-mart Inc and Carrefour SA to own up to 51 per cent in multi-brand retail ventures.

An IKEA spokesperson, when contacted on Tuesday, said: "We will wait for the Cabinet approvals".

In an earlier statement, the company had said: "The IKEA Group has a long-term vision for India and it is a very important market. It takes time to be able to fully live up to all the requirements and we need to have a long-term strategic outlook and partnership with key stakeholders over a period of time.

'HUGE POTENTIAL'

"The plans as outlined in the application are estimations based on previous experience in other markets and our belief that India has huge investment potential.

"We respect the Indian government's views and thoroughness in the approval process. We remain positive to be able to start retail operations soon."