Govt steps up efforts to attract Foreign Direct Investors (FDI)

(posted under - FDI updates - Economy updates) - Transport Minister Kamal Nath had said all impediments would be removed to get foreign investment in the roads and highways sector.

He added that the roads sector is expected to attract USD 10 billion of FDI in the next two years.

The government is also making efforts to bring in foreign investment in the textiles sector, the largest employer after agriculture in the country.

Textiles Minister Dayanidhi Maran had led a business delegation to Japan last month to woo foreign investors in the labour intensive sector.

FDI inflow in January-May period of 2009 was USD 10.58 billion compared to USD 19.56 billion in the same period previous year, a dip of 46 per cent.

The government also proposes to raise the FDI cap in private insurance firms from 26 to 49 per cent and a bill to give effect to the proposal is pending in the Rajya Sabha.

CRISIL Principal economist D K Joshi said by taking the steps government is building pipeline to attract FDI.

Economy Updates - Forex reserves at $271.239 billion down YoY

India's foreign exchange reserves fell for the week ended August 7 to $271.239 billion compared to $271.641 billion in the year-ago period.

India's gold reserves and special drawing rights (SDR), during the week, stood unchanged at $9.671 billion and $1-million respectively, the central bank said.

India's reserve position in the International Monetary Fund (IMF) marginally rose to $1.348 billion compared to $1.338 billion in the previous week, RBI said.

Reserves had risen by $3.930 billion for the week ended July 31, compared to $267.711 billion in the previous week.

Foreign currency assets, during the week, fell to $260.219 billion, against $260.631 billion in the previous week, RBI said in its weekly report.

Inflation at 1.74 percent YoY

The wholesale price index (WPI) is forecast to have fallen 1.74 per cent in the 12 months to August 1, steeper than the previous week's decline of 1.58 per cent, a poll showed on Wednesday.

It would be the ninth straight annual fall in the wholesale price based index, but this is widely seen as a statistical effect caused by sharply higher prices a year earlier.

The index has been rising on a weekly basis since March and analysts said it probably climbed in the week ended Aug. 1, mainly due to rising food prices.

The central bank has also said price pressures are building up, suggesting there was little chance for rate cuts. Weak monsoon rains are also expected to put upward pressure on prices.

source - economictimes

Indian Economy to grow at 7.8 percent in 2009-10

India's economy will likely grow at 7.8 per cent in fiscal year 2010/11, higher than a previous forecast of 6.6 per cent due to an improved investment outlook, better external environment and a recovery in consumption demand, Goldman Sachs said in a note on Monday.

But it kept its growth estimate for the current year ending March 2010 at 5.8 per cent citing a poor monsoon and the follow-on negative impact on rural demand in the near-term.

Goldman's fiscal year target for wholesale price index-based inflation as of end-FY10 is 6.5 per cent with an upside risk, and expects the central bank to tighten policy rates by 300 basis points in calendar year 2010.

Govt applies for $3.2 billion loan for capitalising PSU banks

The government has sought a $3.2 billion loan from the World Bank to infuse capital into public sector banks, the Lok Sabha was informed on Friday.

Minister of State for Finance Namo Narain Meena today responded in the affirmative, in a written reply to the Lok Sabha to a query on whether loans from the multilateral lending agency contain a proposed $3.2-billion for recapitalising state-run banks.

"To enable the PSBs to meet credit requirements of the economy while maintaining a healthy and comfortable level of regulatory capital to risk-weighted assets ratio, a proposal has been sent to the World Bank," he said.

However, on whether the government proposes to borrow funds from the World Bank to prop up the banking system, he said, "The assessment of the Indian financial system during 2007-08 done by the Reserve Bank of India shows that the banking sector in India continues to be healthy, sound and resilient."

Meena further said that India is taking loans from the International Bank for Reconstruction and Development (IBRD) and credit (soft loan) from the International Development Association (IDA).

"The cumulative commitment of the World Bank (IBRD and IDA) loans to India till June 2009 is $73.93 billion (IBRD $37.68 billion and IDA $36.25 billion)," he said.

Foreign Direct investors can invest upto $10 bn for building roads

India is likely to attract foreign direct investment of about USD 10 billion for the roads sector in the next two years.

The Transport Minister Kamal Nath said all imediments would be removed to get the foreign investment in the roads and highways sector.

Govt set to raise $3.2 billion by selling stake in steel companies

In yet another news of selling stake in sick cos the indian government is all set to sell stake in steel companies which might help in raising money, in future we can see more disinvestment news from the government of india, The details are as follows :

The government may raise 150 billion rupees ($3.2 billion) by selling up to 20 percent stake in state-run firms, Steel Minister Virbhadra Singh said on Friday.

The minister said the government was in the process of choosing companies for divestment.

Inflation at -1.58 percent but prices still rise

As per latest official data, annual inflation based on Wholesale Price Index stood at - 1.58% for the week ended July 25, 2009, while it was at 12.53% a year ago. The latest inflation number shows a steeper fall in annual inflation recorded at the end of the previous week at -1.54%.

Government data showed on Thursday that price level for all commodities stayed below zero for the eighth straight week, but prices of

food items continued to surge, signaling political trouble for the Centre and three states preparing for local elections in a few months. Maharashtra is facing assembly polls in October-November, while Haryana that is supposed to go to the polls next year is likely to advance it to this year-end. Jharkhand, now under the President’s rule, is also likely to go to polls later this year.

Finance Minister speaks about Fiscal Consolidation

It's official that government will not induce money into unproductive sectors in a bid to consolidate the fiscal deficit which will touch 6.8% of Gross Domestic Product(GDP) for this financial year finance minister Pranab Mukherjee said today.

India's fiscal deficit is projected to swell to a record 6.8 percent of gross domestic product in the fiscal year 2009/10 (April-March) that has to be funded by a record high borrowing of 4.51 trillion rupees ($95 billion). that's a whopping amount of borrowing.

A report from finance ministery said that - "Government will continue to take necessary measures to moderate inflation, prune unproductive expenditure and closely monitor FRBM (Fiscal Responsibility and Budget Management) targets," so lets see whether these statements turn to reality or it's just an answer to opposition questions in parliament.

Hurray ! We got richer by Rs 4207 per annum per person

Finally IT'S OFFICIAL !! Indian have grown richer by rupees 4207 per annum per person . Thanks to growing economy from the last 3 years or so and still growing although slowed down due to ongoing economic crises through out the world.

Let me tell you about the news of increase in per capita income in some more detail,

An average indian or a normal indian's annual income has increased by INR 4207 per annum, the news were told in parliament today that means the annual per capita income of indian has reached a figure of Rs 37490, that sounds nice but in reality much of the growth in annual income is restricted to bigger cities where as cities of bihar , UP are still underdeveloped and average income is much lower then this figure of rupees 37490 annually.

According to data released by the Central Statistical Organisation, the per capita income of people has increased by over one-third from Rs 26,003 in 2005-06 to Rs 37,490 in 2008-09. The per capita income was Rs 33,283 in 2007-08 so there is a growth in indian economy however the pace of growth has slowed down when compared to previous financial year.

Top 10 most admired companies of world

Here is the list of top 10 companies of the world which are most admired across the globe No indian company features in the prestigeous list-

RANK 1 - APPLE Inc (of USA)

RANK 2 - BERKSHIRE HATHWAY - incorporated by legendary billionaire investor Warren Buffett

RANK 3 - TOYOTA MOTOR

RANK 4 - GOOGLE Inc (Search engine Marketing)

RANK 5 - JOHNSON & JOHNSON ltd

RANK 6 - PROCTER and GAMBLE

RANK 7 - FED EX

RANK 8 - SOUTH WEST AIRLINES

RANK 9 - GENERAL ELECTRIC Ltd

RANK 10 - MICROSOFT Inc

OOPS!! looking for some indian companies.... no one is there...may be in future some indian company would make into it..

Govt invests to bring dead PSU's to life again WILL IT HELP?

Looks like our government is very keen to revive the already dead PSU's like Hindustan Machine Tool, National Instruments Ltd, Cement Corporation of India ltd to name 3 out of the 15 PSU's shortlisted for revival by infusing a whopping 7128 crores of rupees put together. The first impression which cam to my mind after reading this news was that WILL IT REALLY HELP? and the answer i got from my brain was that probably ministers would earn a lot from the granted money and would purchase land and fill their bank accounts...

The PSU's which are already dead was because there was no good leaders to make it a profitable investment the employees of these PSU's were doing their job thinking that it's a government job so they need not work...(typical attitude of a government employee in india).. Companies doesn't work like this at all.. PSU's can only come in profit if it's employees think and work like it is their own company not by thinking that it's a government enterprise so it's a social company rather then a business enterprise.

PSU's like Air India is already begging for funds and what more the third biggest employer BSNL recently showed results and there was a whopping 97 % decline in profits from 2700 crores to meager 102 crore so in next six month BSNL (PSU) will also be running in loss (THAT IS REAL SHAME FOR THE GOVERNMENT AND THE EMPLOYEES OF BSNL) .

There is a similarity in working of the PSU's at time when there was no other such enterprise , i am just going back to pre economic liberalisation era of Economy of India all the PSU's were in profit , the reason for profit however was that people of India did not have any other choice take example of BSNL earlier there was no AIRTEL, Essar, Spice telecom, IDEA cellular etc and BSNL was enjoying it's monopoly in telecom sector employees didn't work at that time too... but customers had no other option so the number of subscribers went on increasing... things changed when Indian Economy was liberalized there were more choices for the people and alltogether competition between PSU's and Private companies increased , but PSU employees didn't change change their way of working and are still sleeping This was the time when Private companies ate up PSU's share and overtook almost all the PSU's in terms of revenue and profitability.

So according to me accompanied with the history of working of PSU's this funding to revive the PSU's will not be beneficial and the scenario and outlook for PSu's would not change at all. THEY ARE ON A STEADY DECLINE and would eventually vanish one day... that's the HARD TRUTH...which we all have to admit until the employees of these PSU's do not change their attitude towards working.

- Himanshu Sharma

Foreign Direct Investment (FD|) drops whopping 47 percent

Foreign direct investment (FDI) in India dipped by about 47 per cent to $2.1 billion in May due to the global recession and the trend is likely to continue for some more months, so it means recession is still at it's best and it looks US stock markets are also behaving in the similar fashion ie still the beast is out there roaming freely across the globe. OR IS IT NOT?

In present situation Indian economy is looking promising as government plans some one crore job oppurtunities in ongoing fiscal THATS GREAT NEWS i'hve heard after a long time from our government but still i wonder how these oppurtunities would be created...

During the same month last year, FDI was $3.9 billion so that's a difference of a good US$ 1.8 billion. However it can be recalled that FDI in 2008-09 was $27.3 billion against $24.5 billion in 2007-08.

India's Forex reserves drop by about $560 million Wk o wk

India's foreign exchange reserves fell to $263.917 billion as on July 10, from $264.477 billion a week earlier. The main reason for decline was mainly because of Changes in foreign currency assets, expressed in dollar terms, include the effect of appreciation or depreciation of other currencies held in its reserves such as the euro, pound sterling and yen

16 FDI proposels given green signal by Government

Government of India cleared total of 16 Foreign Direct Investment Proposals(FDI) totalling to INR 825 crores including on hydro power project in state of sikkim.

The Government, however, revoked all foreign collaboration approvals for ByCell Telecom on concerns over the Switzerland registered company's funding sources.

Among cleared proposals, Teesta Urja will bring in Rs 547.20 crore for developing 1,200-MW hydro power project in Sikkim.

The Government also allowed IL&FS Trust Company to hold two per cent stake in Multi Commodity Exchange of India, that will bring in Rs 108 crore of FDI.