FM eyes on market reforms

The finance ministry has proposed a mechanism under which the equity option can be traded separately and it is expected to be implemented by September this year. This proposal is a market friendly measure from the finance ministry. Definitely this is going to be a favourable for the market and traders. Market players have mixed reaction over the finance minister's proposal. Some feel this will enable a portion of the debenture to be separately traded, even at a discount and address the need of different classes of investors.

The ministry has asked capital market regulator - SEBI to implement this measure, whihc was first announced by Finance Minister P Chidambaram in Budget 2008-09 as part of efforts to expand the domestic market for corporate bonds. According to media reports, the ministry is also planning to ease the norms governing the pricing formula for American Depository Receipts (ADRs) and Global Depository Receipts(GDRs). At present, the ADR/GDR issue price is determined on the basis of the higher of the last six month's average price or the last 15 days average price prior to the issue. The proposal is to reduce it to two months' average price.

IPOs of NHPC, OIL by October 2008

The Oil India Ltd(OIL) will offer 10 per cent of its equity to the public through a fresh issue of shares and it hopes to garner around Rs.2,000 crores from the IPO. The OIL has also plans to sell one per cent of the to its employees, media reports says. NHPC plans to sell 10 per cent of its equity through fresh shares and hope to get valuation of Rs. 16,000 crore.

The media reports also read as the government begins to take advantage of the end of its association with the Left parties and push its disinvestment agenda. The government had planned to divest part of its stake in public sector companies to raise funds for various social programmes. Both OIL and NHPC have the number of independent directors required under Clause 49 of the Listing Agreement with the stock exchange.

Inflation falls, touches 11.89 %

Inflation marginally dipped to 11.89 per cent for the week ended July 12. A good sign of down side of the inflation after it reached to 13 years high record. According to the latest media reports, the inflation has touched to 11.89 from 11.91. It was expected the the inflation would touch to 12.05. However, the fall is unexpected but a good news for the people as well as for the government.

Inflation has softened somewhat with prices of many essential items either declining or remaining static. The trend for the past three weeks connotes that the rate of inflation is stabilizing a bit. The figure for the week ended July 12 is quite in line with the rate of inflation for the week ended July 5, 2008 that stood at 11.91 per cent, marginally higher than the rate of 11.89 per cent reported a fortnight ago. Probably, the monetary policies by the Reserve Bank of India will be effective in controlling the inflation. This is big respite for the government of India and Finance Minister. Now RBI would try to focus on the other aspects to down size the inflation rate further.

India needs urgent economic reforms or political reforms?

The United Progressive Alliance (UPA) government wins the vote of trust in the Parliament. The vote of trust was very crucial for the government as well as for the people, as they have witnessed the political games by various political parties. Many MPs had addressed during the vote of trust and their strategy was observed by the people. Certainly, people feel that there is urgent need of political reforms than economic, after bundles of notes were seen in the Parliament.

The vote of trust of 2008 will ever be remembered in the history of Indian politics. Many people might have lost their confidence in politics, as the ugly side was witnessed during the vote of trust. It was stunning as well as embarrassing moment for the nation when some of the MPs had shown bundles of notes in the Parliament. The vote of trust was over and government won. It is not a big deal, but the level of corruption is a big concern that has reflected the reality in the Indian politics. It's obvious to see political leader leveling allegations but to such an extent, probably a new case in to see.

Recently, media had been tracking all the developments from round the corner. The vote of trust is over, the media needs to concentrate on its role towards building better political system in the nation. People are expecting many things from the media to know the real picture of Indian politics and what will happen when money factor shadows the politcs. In the history of Indian politics, the money deal and game will ever be remembered.

People might be feeling to have urgent reforms in Indian politics rather than economic reforms. It's true the nation is facing high inflation rate and people are feeling the pinch. But the recent political development, has raised the question for the people to choose between economic and political reforms. Democracy is defined as of the people, for the people and by the people. Has the time came to replace the word 'People' with 'Money'? Any answer............

Rupee flat as political uncertainty weighs

The debate over the vote of confidence was started in the Parliament on Monday, a little impact was seen in the forex trading on Monday. The rupee pared early gains on Monday as traders were wary ahead of a parliament session on a vote of confidence and volatile local stocks. At 10:15 am, the partially convertible rupee was unchanged at its previous close of 42.76/77 per dollar. It had hit a 15-month low of 43.50 earlier this month.

The index had risen 8.4 per cent in the previous two trading sessions, boosted by slower-than-expected inflation and falling global oil prices, but is down about a third so far in 2008. Oil, India's biggest import, was below $130 a barrel after its biggest one-week slide on record as inconclusive talks between Iran and world powers over Tehran's disputed nuclear programme dimmed prospects of ending the row, according the media reports.

Government expenditure may increase : CMIE

A Centre for Monitoring Indian Economy (CMIE) says that the Union government expenditure is expected to overshoot by 21 per cent this fiscal, in a report. Farmers' debt relief package, additional subsidies on petroleum and fertiliser products are some of the factors would affect the rise in government expenduture. Apart from that some other factors too includued in the report these are - Sixth Pay Commission's recommendations and interest rates on government debt papers. The total expenditure budgeted at Rs.7,50,884 crore for 2008-09, which is 5.2 per cent more than the actual planned expenditure in 2007-08. The total government expenditure, including expenditure on debt relief package and outgo on account of Sixth Pay Commission's recommendations for 2008-09 stands at Rs.7,81,448 crore, the CMIE report said.

Will Stock Market react to vote of trust?

The Congress-led UPA government will face the trust vote on Tuesday. It is expected that following this the stock market may react to this heavily. But on Friday there were normal trading in the market and a surge of 523 was recorded. "Friday’s upsurge was mostly because of a fall in oil prices. There is also a feeling that the government will survive and so the nuclear deal will go through," said KR Choksey Shares and Securities chairman Kisan Choksey, according to media reports. It business of the market was normal for two days, despite the political instability at the centre. Besides this factor, other factors like crude oil prices, inflation and the net profit or lost of companies in the first quarter, will influence the market.

Such political instabilities were also witnessed earlier but the market business was not affected heavily by then. Let’s have look on such situations and their impact on the Indian stock market, on April 11, 1997, the then prime minister HD Deve Gowda lost the confidence vote after the Congress withdrew support to the United Front government. Atal Bihari Vajpayee resigned before the confidence motion was put to vote on May 28, 1996, and the BJP then could not prove the majority. On November 7, 1990, VP Singh lost the vote of confidence after the BJP withdrew its support to the government. Even on such political instabilities, normal business was seen in Indian stock market. The day of vote of trust of a big deal for the UPA government but it may not have much hard impact on the stock market. However, the impact on the stock market would not be completely ignored.

Hybrid car in India?

German luxury car maker BMW reportedly is considering bringing a hybrid car in India with in next two years after its global debut, which is expected to happen in next 18 months. According to media reports, the company which has had successful start to its Indian venture, has also raised its sales target in the country by 40 per cent to 2,800 units this year. BMW has been developing hybrid vehicles and showcased ConceptX6 Active Hybrid at the 2007 Frankfurt Motor Show. Recently, Honda had taken the lead in introducing hybrid vehicle in India with its Civic Hybrid priced at 21.5 lakh. It would be very interesting to see the Indian car market having both cheapest and hybrid cars in the next two years. This would be very interesting to see hybrid cars on India road along with Tata's Nano.

Union Cabinet approves eight new IITs

The Union Cabinet on Thursday has approved the setting up eight new Indian Institutes of Technology(IITs) and upgrading the Institute of Technology of Benaras Hindu University to an IIT. The new IITs will be set up in Bihar, Andhra Pradesh, Rajasthan, Orissa, Gujarat, Punjab, Himachal Pradesh and Madhya Pradesh.

The Union Cabinet has also approved amendments to the Drugs and Cosmetics(Amendment) Bill, 2005, pending in the Rajya Sabha. Also approved for the upgrade and strengthening of 5,000 kilometers of single, intermediate and two-lane national highways to two-lane with paved shoulders. This upgrade will be carried out under National Highway Development Project (NHDP)Phase IV-A at an estimate of cost of Rs.6,950 crore.

Other important decisions were also taken by the Union Cabinet including:

• Creation of posts of director and medical superintendent in six AIIMS-like institutions, to be set up in Bihar, Orissa, Chattisgarh, Madhya Pradesh, Rajasthan and Uttarakhand.

• Rs. 1,280.96 crore for six launches of the Geo Synchronous Launch Vehicle (GSLV) between 2010 and 2012.

• Singing of a memorandum of understanding between Kathmandu-based International Centre for Intergrated Mountain Development and Gobin Vallabh Pant Institute of Himalalayan Environment and Development in Almora.

• Signing of an extradition treaty with Brazil.

Crude Oil price falls by $10 a barrel in New York

The rise in crude oil price is the big challenge for the global economy. Many countries have been reeling under the crisis due to the rise crude oil prices in the global market. In India, the impact is very high; as a result in order to meet the crisis recently the government raised the prices of petrol, diesel and LPG. The sharp fall in the crude oil prices may have positive impact on many economies in the world.

Crude oil prices fell sharply in the global market on fears that a further economic slowdown in the US may hit the demand. Prices plunged more than $10 a barrel in New York, it is recorded as the maximum drop in last 17 years. The OPEC warned that the higher prices could curtail global demand for crude; it could be the reasons for the sharp fall seen in the crude price. Meanwhile, the US President, George W Bush, has lifted a ban on offshore oil drilling. But it can't begin without the approval of Congress. He said there can’t be quick fix solution to the ongoing oil crisis, according to the media reports.

CAT Dates Announced: Fees Revised

The seven Indian Institute of Management (IIMs) have announced the date for the Common Admission Test (CAT). CAT is the entry point for admission to IIMs as well as all leading business schools and an estimated 300,000 aspirants try their luck at it. The CAT examination is scheduled to be held on Nov 16, 2008 at 23 centers in India which include Ahmedabad, Bangalore, Delhi, Hyderabad, Kolkata, Kozhikode, Lucknow. A valid score is the ultimate aim of all the aspirants to get into best institutes. It's the CAT score that will help you make your better career with best institutions. This year the price of the admission forms has been raised by Rs 200 for the general category and OBC students and by Rs 100 for SCs and STs, taking the price to Rs 1300 and Rs 650.

For more information visit the website : here

Inflation to remain in double-digit this year: IEG

The Institute of Economic Growth (IEG) on Monday said inflation would remain in double digit this year, while suggesting the RBI to intervene in the forex market to moderate price rise. This is certainly a news that people does not want to see the existing double digit inflation rate.

If the double digit rate remains then the impact would be very high. Of late, the dollar is gaining strength against rupees, which could be another concern for the economy. Considering this aspect, the IEG also hints that RBI should also look into the forex market and currency values. Inflation rose to 11.89 per cent for the week ended June 28 signaling further tightening of the monetary policy by the apex bank. The institute forecast that the GDP growth would moderate to 7.5 per cent in the current fiscal from 9 per cent in 2007-08. However, a good monsoon is the need of the hour to have good production to check the supply side of the inflation.

India ranks 41 in UNIDO report over industrial competitiveness

According to United Nations Industrial Development Orgnisation (UNIDO) report India is lagging behind 40 other countries in industrial competitiveness. India has achieved 41st rank out of 100 different economies of the world. In the top 15 countries achieved pace are Ireland, Switzerland, Japan, Belgium, Sweden, Finland, Germany, Korea, Taiwan Province of China, France, the US, Hong Kong, Austria, Slovenia. However, Singapore is on the top of the list, according to media reports.

In the race of industrial development, Pakistan has ranked at 55 and Bangladesh and Sri Lanka rank at 65 and 75 respectively. Comparing their development India is in better position than the neighbors. The index measures the competitive performance of countries in terms of their ability to produce goods competitively, keeping abreast with changing technologies as well as the intensity of industrialisation, which is the share of manufacturing value added in GDP.

iPhone 3G in Indian Market

The mobile preference of consumers has been changing and mobiles with best features are getting better response. After the iPod, it’s time for iPhone. Apple has introduced its news iPhone 3G with many features and Indian mobile market is a dream destination for this product. As Indian mobile market has been growing day-by-day. The Telecom Regulatory Authority of India (TRAI) said there were 269.30 million wireless users in India at end-April, up 57 percent from a year earlier.

The iPhone 3G covers many futures such as a widescreen iPod and a breakthrough Internet device in this new iPhone 3G. iPhone 3G combines all the revolutionary features of iPhone with 3G networking that is reportedly twice as fast as the first generation iPhone and built-in GPS for expanded location based mobile services. iPhone 2.0 software which includes support for Microsoft Exchange ActiveSync and runs the hundreds of third party applications already built with the recently released iPhone SDK. Make a call by tapping a name or send a text with the intelligent keyboard.

Some other features are - an equally brilliant iPod, you can enjoy music, videos, and more on the 3.5-inch color display and browse by album artwork with Cover Flow. GPS adds a new dimension to mobile phone mapping. Find your location, get directions, and track your progress along a route. Where as, 3G gives you fast access to the Internet and email over your cellular network. And 3G makes it easier to multitask: When connected via 3G, you can surf the web even while you’re on a call. Find your location, get directions, and track your progress along a route. Definitely, mobile lover would be eager to know much more features of this product and willing to explore it further. If you were planning to buy, then visit the page.

Indian Software, services revenue to grow at 21-24% to $62 b

India’s software and services revenue is poised to grow between 21 and 24 per cent during 2008-09 to touch $62-64 billion. The growth rate projections for FY09 are a tad lower than 28 per cent growth achieved in FY08, on account of a possible slowdown in decision-making on new projects and also due the fact that the industry now operates on a much larger base, according to media reports.The President of Nasscom Mr. Som Mittal says “While almost 70 per cent of the IT spend is on existing projects, about 30 per cent is on new projects which is a discretionary spend. The decision-making on new project gets affected in a challenging environment.”

The global crisis and US economic slowdown would be the big concern for the Indian IT sector and services. The speculation over the future of outsourcing in India is not clear, despite reportedly given green signals from US leaders. On the other hand, the currency fluctuation is another factor that determines the growth of the IT sector. Of late, there is fluctuation in both rupees and dollar, earlier it was rupees on appreciation and now the dollar is on appreciation against rupees. Many companies in US have been adopting to cost cut policies in order keep their budget intact, whereas this will have huge impact on Indian companies. Even companies have been cutting jobs to reduce their cost in US. Certianly, this a tough time for the Indian IT companies.

Anil opens shop in Britain looking for investors

Britain has approved the proposal of Indian tycoon Anil Ambani to open a London office of his fund managing company, Reliance Assets Management (RAM), to attract European investors for the first time. The company, said to be among India's largest fund managers, has won approval from the Financial Services Authority to open the London office with the objective of winning assets from wealthy and institutional investors in Britain and Switzerland. This was announced in today's Wealth-Bulletin, a Dow Jones company and online analysis service for the global wealth management industry.

Read the complete story here: Source.

Will Inflation touch 14-14.5 pc in December 2008?

It's all about the inflation. India is reeling under the pressure of high inflation rate, which has touched the double digit mark. Fiscal measures from the RBI have failed to check the inflation. The rise in crude price at the global market is the one of the reasons for high inflation rate in India. Considering the high crude price and loss to the oil corporations, the government of India has hiked the prices of petrol, diesel and LPG recently, which reportedly sparked the inflation further. This hike has affected the budget of the people. Inflation is a sensitive issue in India and the impact can be seen including on stock market too. The impact is very high as some of the stock traders have cancelled their accounts due to sluggish market trading.

From a common man to industrialists, all concern about the high inflation rate which force them to keep their budget proper to meet the market prices. There may be mixed reactions and expectations from the people from every corner of the society regarding the inflation. Some are optimistic that inflation may back to normal rate, as the measures would be effective. But the version from the industry body Assocham is different from this. They feel that inflation may touch 14.5 percent by the end of this year.

Earlier, the expectation of double digit inflation rate has come true. The inflation has remained unabated touching a 13-year high of 11.63 per cent for week ended on 21st June, despite the government and Reserve Bank’s steps to cool the demand for commodities and increased supplies. The inflation has been changed the budget estimation of the people in India and further surge in inflation would prove more adverse for the economy. The inflation has been reportedly affected the defence budget too. If the inflation rate will remain till the end of this years despite good monsoon and effective supply mechanism, then the situation might be out of control.

World Bank team to assess Eastern Corridor Project

A six-member World Bank team will assess the Eastern Corridor project of Indian Railways. The team is scheduled to arrive in India on July 14, according to media reports. The Eastern Dedicated Freight Corridor Project has been approved by the Cabinet Committee on Economic Affairs.

Indian Railways has approached the World Bank for the funding the Rs. 12,000 crore project. The project will be used exclusively for operating freight trains at maximum permissible speed of 100 km per hour. The corridor will start from Ludhiana and end at Kolkata. It is expected that, the corridor will complete in two phases. The project will benefit Indian Railways and other industries.

IT Market to grow high after US Presidential Elections

There is a concern in the IT industry over the global economic slowdown in the past few months. Particularly, the slump in the US economy, has hit the IT industry to a considerable extent. Shortage of projects and lay-offs have been a part of recent market meltdown. However, experts believe that there is no reason to be panic and Indian IT market will register a high growth aftermath US Presidential Elections in November 2008.

With Democratic Presidential nominee Barack Obama allaying fears of a crackdown on outsourcing, the Indian IT and ITES industry have taken a huge sigh of relief. Since both Obama and Republican John McCain are not against outsourcing, India can hope for better results once a new President takes over in the United States.

The IT giants like Infosys, Wipro, TCS, Genpact, MindTree and others have already signalled that they are going to recruit thousands of IT professionals by 2009. The job aspirants should not get distracted over the turnarounds in the IT market. They should just brush up their skill set and wait. The year 2009 will open great opportunities for the IT professionals.

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