Indian Holocaust My Father`s Life and Time - SIX HUNDRED FIFTY NINE
Palash Biswas
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Full Bloom LPG Mafia Rule!
Markets ended in the negative territory as jittery investors booked profits ahead of the Reserve Bank of India's policy meet.
With the cutoff at Shri Ram College of Commerce (SRCC) being an unbelievable 100 percent, Union Human Resource and Development (HRD) Minister Kapil Sibal on Wednesday said the government is on the students side, and added that it is unfortunate that some colleges have record cutoffs this year.
"I am unhappy to hear about 100 percent cutoff in one college. The right to admission cannot be denied. This is an attempt to keep science students away. We can't stop science students from studying commerce," said Sibal.
"I request the Delhi University Vice Chancellor to take note of it," he added.
Meanwhile, Delhi University Vice Chancellor Prof Dinesh Singh said: "100 percent cutoff is unfortunate. First list is always cautious, other lists will come down. Cutoffs will come down in the subsequent lists."
SRCC Principal PC Jain, however, said: "100 percent cutoff is justified. The college has been following the practice for many years."
The first cut-off list for Delhi University is out and it seems like a student's worst nightmare, as the cut-off at Shri Ram College of Commerce (SRCC) is an unbelievable 100 per cent.
Hindu has announced the subject cut-off at 99 per cent, while Lady Sri Ram College has placed it at 97 per cent. This is a clear five to ten percent increase in cutoffs, as compared to the fist list in 2010.
Not just commerce, even science cutoffs have also broken all records.
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15 JUN, 2011, 09.42AM IST,TNN
'Strengthen governance, help private sector expand'
NEW DELHI: At a time when the government's image has been hit, OECD on Tuesday suggested that public sector governance should be made more transparent and accountable in India by separating operational and regulatory functions in the provision of services and by strengthening the anticorruption set up.
The policy prescription comes within weeks of the Planning Commission suggesting that the role of government departments should be limited to policy making, while service delivery should be handed over to professionally managed entities.
The OECD, a group of 34 industrialised nations, said administrative burden which have held back the expansion of private firms, needs to be eased and called for stepping up efforts to restructure public expenditure , relax constraints facing the financial sector and further promote international integration.
It says in the near-term the Indian authorities need to remain vigilant against the risk of high inflation and capital flows. The OECD in its economic survey of India said reducing fuel subsidies, which are amongst the largest among all fuel importing countries and cost 3.5% of gross domestic product, would result in significant environmental benefits.
"Gasoline prices are now allowed to move more closely in line with the world prices, a reform the government intends to broaden to diesel. Reductions in all forms of subsidies will require building a consensus that change is needed and providing clear evidence that the poor will not suffer as a result," the OECD survey said.
It said government should make efforts to intensify reforms in the financial sector. OECD said over the medium term, growth could rise to 10% if the rise in saving stemming from the fall in the number of children relative to the size of the working population is deployed into higher investment.
http://economictimes.indiatimes.com/news/economy/policy/strengthen-governance-help-private-sector-expand/articleshow/8859552.cms
Credit policy review tomorrow: What to expect? RBI warns banks over heavy market borrowings!Whereas,India inks $ 432 million loan agreements with ADB!Meanwhile,India, OECD discussed tax reforms!Paris-based Organisation for Economic Cooperation and Development (OECD) is a 34-member grouping of mostly developed nations, including the US and Germany. OECD, whose members account for over 60% of the global output, also plays a key role in setting the global tax standards . India and OECD are likely to discuss a range of issues, especially related to reducing tax complexity and boosting overall tax administration.
The Reserve Bank expressed concerns over rising exposure of banks to the real estate sector and said it could lead to an increase in the non-performing assets (NPAs) of the banking sector.
New Delhi is reviewing Double Taxation Avoidance Agreements (DTAAs) with various countries besides entering into Tax Information Exchange Agreements (TIEAs) with many jurisdictions that are considered to be tax havens. Apart from working on ways to bring back black money stashed abroad, the Government has also embarked on ambitious tax reforms, both on direct and indirect tax fronts. "The introduction of the Direct Taxes Code (DTC) and the proposed Goods and Services Tax (GST) will mark a watershed .
These reforms will result in moderation of rates, simplification of laws and better compliance," Mukherjee had said while presenting the Budget for 2011-12 . While DTC is scheduled to become effective from April 1, 2012, a constitutional amendment bill on GST was introduced in Parliament earlier this year. On June 14, OECD would release its Economic Survey of India. The report would focus on the need to continue with market-orientated reforms to ensure strong and sustainable economic growth.
"This increased reliance on borrowed funds raised concerns about the liquidity position of banks arising from growing maturity mismatches, in conjunction with a reduction in the share of liquid assets in total assets," RBI said in its Financial Stability Report released on Tuesday.
The banking sector balance sheet increased by 19 per cent during the year ended March 31, 2011, spurred by a robust growth of 22.6 per cent in credit off take.
The growth in deposit mobilisation, at around 18 per cent did not keep pace with the growth in credit.
The gap was funded by increase in funds accessed from market (certificate of deposits issuances and borrowings), which increased by 34.5 per cent over its position as at end of March, 2010, it said.
The share of borrowings and CDs in banks' liabilities rose to about 10 per cent in 2011 from about 7.5 per cent in 2006, it said.
In particular, it noted, the period from October, 2010 to February, 2011, during which the systemic liquidity conditions were strained, witnessed increased CD issuances with interest rates rising to 9-10 per cent.
Increase in borrowings from market was particularly evident in the case of public sector banks and new private sector banks, it said.
At the current juncture, however, the reliance on market borrowings was not very significant in absolute terms, it said.
Also, it said, concerns were alleviated by the accessibility of banks to stable low cost deposits (current account and savings account -- CASA deposits), which stood at about 35 per cent of total deposits.
The government today signed two loan agreements worth $ 432 million with multilateral funding agency Asian Asian Development Bank (ADB).
Of this, $ 300 million loan will help the Madhya Pradesh government to upgrade about 1,000 km of State highways in the eastern and west central parts of the state, a finance ministry press statement said.
As part of the loan package, ADB is additionally providing technical assistance or grant worth $ 1 million to support road safety and private sector participation in state highway development and maintenance, it added.
With the completion of this project, the entire state highway network of Madhya Pradesh will be upgraded, it said.
Besides, a $ 132 million loan agreement was signed for strengthening Bihar's power sector.
The major portion of the ADB loan $ 130.3 million will be used to finance infrastructure such as transmission lines, the statement said.
The remaining $ 1.9 million will be used for strengthening the internal capacity of the Bihar State Electricity Board (BSEB), it said.
The loan will be used to install new transmission lines and to renovate and modernise transmission and distribution facilities to improve the quality and reliability of the state's electricity supply network.
ADB will assist BSEB with project implementation and construction supervision, including training in the maintenance and operation of high-voltage distribution systems (HVDS), it said.
Delhi University admission: Finally, the 100% cutoff is here
NEW DELHI: The way Delhi University cutoffs have been spiralling, it had to happen someday. On Tuesday, it did. The first cut-off for BCom (H) at the Shri Ram College of Commerce reached an unbelievable 100% for the non-commerce aspirants.
This means, humanities and science students wanting admission in BCom (H) at SRCC will need to have 100% marks in their best-of-four subjects! In other words, no non-commerce student will be admitted in the course, at least in the first list.
The first cut-off list for the admission to undergraduate courses in Delhi University, released on Tuesday, brought more shock than hope. Science courses played hard-to-get with Daulat Ram College hiking its cutoff for chemistry (H) by as much as 13%. Gargi College followed suit and increased the cutoff marks for chemistry (H) by 12%, closely followed by SGTB Khalsa which raised its physics (H) cutoff to 92% this year - a hike of almost 10% from last year. At Miranda House the cutoffs for chemistry (H) and physics (H) went up by 8%.
"Last year, most students admitted in science courses chose to continue with their courses instead of dropping out like in previous years. In fact, many colleges faced overcrowding in classrooms. Most colleges had kept science cut-offs at a reasonable level, aiming to admit more students than the intake so that they were not left with vacant seats if students dropped out," said Meera Ramachandran, principal Gargi College.
The fear of over-admission plagued all colleges in absence of pre-admission forms this year. With no way of knowing how many students would take admission in a course, the best way for colleges to tread on the side of caution was to inflate cutoffs.
While SRCC has completely closed the doors for students who did not study commerce in school by keeping the cutoff at 100%, the hike for commerce students is "reasonable". The college is not sure if there will be another list. "We have hiked the BCom (H) cutoff by 0.75% and economics (H) cutoff by 1.75%. The cutoffs should go down in the second list but our first cutoffs for commerce students are quite reasonable. And there are chances of filling up all seats in first go," said P C Jain, principal, SRCC.
Non-commerce wanting to study BCom (H) are unwelcome at Hindu too. The college has announced a cutoff of 99% for BCom (H) for non-commerce students though the cutoff for those who have studied commerce is 95.5%.
Surprisingly, Kirori Mal College and Lady Shri Ram College have come out with 97% as the first cutoff for BCom (H) - higher than the cutoff for commerce students at SRCC. The highest increase in BCom (H) cutoff was 8% at Satyawati College (evening) followed by 6% at Bharati College. There is an increase of 1.5% to 3% in the cutoff for economics (H) across the board. The dependable BA programme too has shown a sharp hike this year. There is a clear hike of 5% (Bharati, Bhagini Nivedita) to 10% (Ramjas) in the first cutoff as compared to the first list in 2010.
http://economictimes.indiatimes.com/news/news-by-industry/services/education/delhi-university-admission-finally-the-100-cutoff-is-here/articleshow/8857365.cms
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Kapil Sibal
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"The real estate sector posed some concerns given the large and growing share of these loans in the credit portfolio of banks, its NPAs witnessing higher than system level NPAs growth, and potential of greater slippages into NPAs," RBI said in its Financial Stability Report.
The apex bank, however said that the share of real estate NPAs in the gross NPAs of the banking sector stood at 15% against the share of sector's credit in total credit at 17.7%. The credit to the sector registered a growth of 24.6% in 2010-11 against 17 per cent in the previous year, it said.
Residential mortgages and the commercial real estate registered a growth rate of about 24%, the central bank added.
Meanwhile, the new private sector and foreign banks increased their commercial real estate exposure by 59 and 69%, respectively in 2010 11 against the single digit growth rate witnessed in the previous year.
The rate of growth of NPAs in commercial real estate segment stood at 19.8% was also higher than the overall NPA growth rate of 14.8%.
"The asset quality in this segment may come under further pressure given the increasing interest rate environment," it said.
The Reserve Bank of India will take another step to curb the rising inflationary pressure, as it announces its mid quarter policy review tomorrow. That's the consensus of a CNBC-TV18 poll of bankers and economists. Sooner or later this will mean higher home loan EMIs, but also higher deposit rates, report Vidhi Godiawala and Gopika Gopakumar.
RBI Governor is unlikely to take a pause on his anti inflationary stance. That's the consensus of a CNBC-TV18 poll of bankers and economists, entire 100% expect a hike in the repo rate by 25 basis points to 7.5%.
Majority also don't expect the RBI to stop with this policy action. Sixty percent of the respondents expect the RBI to hike rates further by 50 basis points by December 2011 and 40% expect a 75 basis points hike.
Hundred percent of the respondents expect the Central Bank to leave cash reserve ratio (CRR) unchanged. If RBI hikes repo rate by 25 bps, 20% of the respondents expect lending rate hike and 10% expect deposit rate hike.
Bhanu Baweja, Head - Research & EM Strategy, UBS says, "We are looking for 25 basis points on June 16. We should be expecting at least two more rate hikes out there. Potentially more than that, if you don't see credit growth moderating much, if you don't see food price inflation coming off."
The RBI and the government have said that inflation will remain high for the first six months of FY12 before it starts tapering down.
Seventy percent of the respondents agree that inflation will peak off by September, but 30% believe it may remain high till December before showing signs of decline.
Despite the RBI's measures, 40% of the respondents expect March end inflation to remain at 7% and above. Fifty percent see it between 6.5-7% and only 10% expect inflation at 6-6.5%.
The high inflation situation is becoming a deterrent for global investors from entering Indian markets.
Aadil Ebrahim, Managing Director, Bowen Asia says, "The inflation issue is very worrying. The RBI is focused on food inflation that came down, now it's manufacturing inflation and it's been incredible for the last six-eight months. We have been stubbornly stuck at 8-10% levels. You talk to any investor in Europe and US and they won't touch the market if inflation is that high."
Growth is expected to slowdown in FY12. Sixty percent of those polled have scaled down their gross domestic product (GDP) growth forecasts for FY12, and the others, either already had a lower growth target, or are likely to decide in a few days.
Sixty percent of the respondents expect the economy to grow at a rate lower than 8% in FY12. Twenty percent see GDP growth at 8% and the other 20% say the economy will grow between 8-8.5%.
Sanjay Mathur, Regional Economist, RBS says, "We are working with 7.4%. What we have seen in the Indian economy, which is quite worrying, is that the investment momentum is tapering off, consumption has peaked and it is not very clear as to when the investment momentum would be reversed."
Slower growth is expected to lead to lesser demand. Hence bankers had mixed views on whether they will be able to pass on the rate hikes. Big bankers say they will hike lending rates and may be even deposit rates. Some others are not so sure. But it will be only a matter of time before EMIs start to rise.
Govt killing Lokpal: Team Anna
Open divide between Team Anna and the government. If no consensus is reached then each will send its own draft on Lokpal, the final call of which will be taken by the Union Cabinet.
New Delhi: The deadlock between the government and Team Hazare continued Wednesday with union Human Resource Development Minister Kapil Sibal saying the two sides would give their versions of the Lokpal bill to the cabinet, which would take a final call on drafting a strong anti-corruption legislation.
The seventh meeting between the 10-member panel of government and civil society representatives drafting an anti-corruption Lokpal bill ended on a bitter note. Civil rights activist Arvind Kejriwal criticised the government for killing the "Lokpal bill before it even got birth".
After a marathon meeting lasting over two hours, Sibal agreed that "it was quite clear that there were areas of strong divergence of opinion" between the civil rights activists and the government.
"We will try for a consensus. But we are not able to arrive at a consensus then we will give two versions. We will give our version and the civil society will give their version to the cabinet," Sibal, a member of the 10-member panel, told reporters.
By June 30, a draft Lokpal bill will be sent to the union cabinet, he added.
When asked whether there will be two drafts, Sibal said: "There will be no two drafts but both the versions of the draft will be sent."
The next meeting is slated for June 20 and 21, he added.
The Lokpal drafting talks have also been hit over the insistence of anti-graft activists, led by Gandhian Anna Hazare, that the prime minister's office should be brought under the ambit of Lokpal and that the panel proceedings should be telecast live, which the government is opposing.
Kejriwal, one of the key members of Team Hazare, said there were many points of differences and the two sides had agreed on submitting two versions to the cabinet.
"One draft will be prepared by us and the other draft will be prepared by the government ministers. Both will be presented before the cabinet and the cabinet will decide which version with correction would be presented to the parliament. But we don't have much hope as it is their cabinet," he added.
"It seems that the government has already made up its mind on the matter. There is no discussion in the meeting and government is just giving its decision. The government has a hardline attitude," he alleged.
"It is clear that the government wants to kill the Lokpal. It seems that government was pretending for the past one and a half month. They were predecided on the matter of Lokpal," he alleged.
Prashant Bhushan, another civil society member of the panel, said there were "too many fundamental differences between" them and the government. "The cabinet will decide which version to take, with what modifications, to be presented to parliament."
The two sides have been engaged in a bitter war of words for the past few weeks. Anna Hazare, who has threatened to go on indefinite fast again if the Lokpal bill is not passed by parliament by Aug 15, said the meeting was "very good." It was also Hazare's birthday Wednesday. He turned 74.
Source: IANS
Three detained for journalist J Dey's murder
Mumbai: Four days after the murder of Mid Day journalist J Dey, police have detained three persons, believed to be members of Chhota Shakeel gang, in connection with the killing.
"Three people have been detained. We are probing their role (in the case). We want to be sure (of their involvement in the crime) before jumping to a conclusion...," a senior crime branch official told PTI on condition of anonymity.
The three were believed to be working for fugitive gangster Shakeel, the right hand man of underworld don Dawood Ibrahim, and their antecedents were being verified, he said.
Jyotirmoy Dey (56), Editor (Special Investigation), with Mid Day, who extensively covered underworld and crime for over two decades, was shot dead in broad daylight by four motorbike-borne assailants at Powai on June 11.
Meanwhile, Chief minister Prithviraj Chavan told reporters after the cabinet meeting that there were "some developments" in the Dey murder case probe.
"There are some developments (in the Dey murder case probe). Important breakthrough is expected soon," he said, but declined to elaborate, saying "You will be appropriately briefed (by the police)."
The chief minister said he had no idea if anybody has been arrested in connection with the incident.
Chavan said a cabinet sub-committee would be set up soon for preparing the draft bill for protection of the journalists. The government, he said, hoped to table the bill in the legislative Assembly during its monsoon session.
Justice for Dey: Mumbai scribes to fast from Wednesday
Mumbai: Mumbai journalists will launch a relay fast from Wednesday following the Maharashtra government's refusal to hand over journalist Jyotirmoy Dey murder case probe to the Central Bureau of Investigation (CBI), a media representative said here late Tuesday.
"The chief minister (Prithviraj Chavan) refused to consider our demand for resignation of Home Minister R.R. Patil and suspension of city police commissioner Arup Patnaik. In view of this, the Patrakar Halla Virodhi Kruti Samiti has decided to continue the agitation by resorting to relay hunger strike from June 15," said Mumbai Press Club secretary Sunil Shivdasani.
He said that following the protest march by over 500 media persons Monday, the state government assured that it would bring in a law to protect journalists but refused to hand over the Dey killing probe to the CBI.
In view of the pending demands, the PHVK supporters will sit on a chain hunger strike from 9 a.m. Wednesday at the Mumbai Marathi Patrakar Bhavan at Azad Maidan in south Mumbai, Shivdasani said.
Chavan reiterated his stand that the probe into the killing of Mid Day journalist Jyotirmoy Dey would not be handed over to the CBI. He was speaking informally to media persons at Mantralaya, the state government headquarters in south Mumbai.
Chavan hinted that Mumbai Police have made a headway in the case. "Let us not undermine the morale of the police force. We have to give them sufficient time before we can consider other options," Chavan urged.
Dey was shot dead by four unidentified motorcycle-borne assailants near his residence in Mumbai Saturday afternoon, sending shock waves through media circles.
Gadkari demands CBI probe in journalist's murder
New Delhi: Bharatiya Janata Party president Nitin Gadkari Wednesday wrote to Maharashtra Chief Minister Prithviraj Chavan demanding a Central Bureau of Investigation (CBI) probe into the murder of Mumbai journalist Jyotirmoy Dey, who specialised on the underworld.
Saying that Dey had "an unflinching commitment to the cause of fearless and objective reporting", Gadkari supported the demand for a CBI probe into the issue.
"We officially support the demand that this case be handed over to the CBI," Gadkari said in his letter.
He said that amidst allegations of police involvement in the murder, handing over the case to the CBI will ensure an unbiased probe.
The BJP president also pointed out at the possibility of underworld links and collaboration between "criminal elements and the terrorist tendencies".
"I would request you to look into the possibility of the involvement of some of the underworld dons, from here as well as from abroad, in this heinous crime. As I understand, this incident also signals the joining of hands of criminal elements and terrorist tendencies," Gadkari said.
Dey, an investigative reporter with Mid-Day, was shot dead by four unidentified motorcycle-borne assailants as he was riding his motorcycle near his residence in Powai June 11.
The Mumbai police, who have so far not made any headway in the case, released a sketch of one of the suspects Monday.
Source: PTI & IANS
Hi-tech houses for MPs at South & North Avenue
New Delhi: Government has proposed to construct three-storey houses for Parliamentarians at North and South Avenue by demolishing the existing ones, to modernise and increase the capacity of the blocks.
Estimated to cost around Rs 55 lakh per house, the new type VI houses will have digitally-controlled door system, a first of its kind for MPs in Lutyen's zone.
Currently there are 356 MPs staying in North Avenue (193) and South Avenue (163).
"As per the redevelopment plan, there will be total 414 Type VI houses at North Avenue and South Avenue," said a senior Urban Development Ministry official adding "the new blocks will be able to accommodate 58 more MPs."
Constructed around 80 years ago, the maintenance of these houses has become difficult.
"There are problems of seepages in almost all rooms and buildings are in bad shape. There are many alterations and additions in the existing structure as per the requirement of MPs. It was incurring more expenditure on account of maintenance," the official said.
Garages and servant quarters are also situated in a scattered way in North and South Avenue. The new houses with modern facilities will be constructed in phases after demolishing the existing houses.
There will be 40 new blocks in North Avenue and 37 new blocks in South Avenue in the total 27.4 acre land in Lutyen's Delhi. To enhance the security system, CCTVs will be set up and the entry and exit will be equipped with access-controlled system. "Currently there is no such security system in North Avenue and South Avenue and MPs have demanded for strengthening the security as there are many theft cases reported in the area," said the official.
Designed by CPWD architects, the new Type VI houses will have four-bed rooms, attached toilets with each bed room, kitchen, office-cum-study, drawing and dining.
The design is being done in such a way that the tree-studded character of Lutyen's zone is kept intact and the height of the three-storey building will not be exceeding the tree's height.
"Though these new houses will have modern facilities, the design is in sync with the adjoining buildings," he said. There will also be community halls, CGHS dispensary, canteen besides garages and servant quarters.
After getting the approval of the Delhi Urban Art Commission, the design of the new Type VI houses will be sent to PMO for final approval for starting the construction of the new houses.
Source: PTI
Probe sought into Nigamanand's death
Dehradun: Family members of Swami Nigmanand, who died at a hospital in Dehradun after fasting for over two months, on Wednesday demanded a thorough probe into the circumstances leading to his death.
Uttarakhand government's insensitivity can be gauged from the fact that it arranged the best medical facility to Yoga guru Ramdev at the same hospital in Dehradun where Nigmanand died for lack of treatment, Nigmanand's father Subhash Chandra Jha, grandfather Surya Narayan Jha and grand mother Jaikali Devi said.
The family members spoke to Bihar Director General of Police Neelmani and Home department's Principal Secretary Amir Subhani, seeking their help for bringing the body to the native village Ladari in Uttrakhand.
Justice should be done and the "Bihar government should also take up the matter with the Uttrakhand government," they said.
"We want to cremate the body at the village," they said and added that the role of Shivanand, another Swami of Matra Sadan in Hardwar, should also be probed.
Swami Nigmanand of Matra Sadan passed away at the hospital in Dehradun on June 13. He had been on fast-unto-death since February 19, 2011, for the 68th consecutive day, when he was forcibly hospitalised by the district administration.
Nigmanand, who died at 34, was agitating against illegal quarrying being carried out in the Ganga river-bed with the alleged connivance of officials and quarrying mafia.
Congress demands CBI inquiry
Dismissing the CB-CID inquiry into the death of Swami Nigamanand as ordered by the Uttarakhand government, the Congress on Wednesday demanded a CBI probe in the case.
"Ramesh Pokhriyal government is responsible for the death of Swami Nigamanand as it failed not only to check illegal quarrying in the Kumbh area at Haridwar but also failed to provide proper medical care to him," Uttarakhand PCC president Yashpal Arya said.
The PCC president said the Congress has no faith in the State government and demanded that the case be handed over to the CBI.
He accused the BJP government of making Bollywood actor Hema Malini the brand ambassador of Ganga Cleaning Campaign and said it did not take any action on the demand of a Sadhu, who sacrificed his life after fighting for 114 days for the same cause.
Arya also accused the State government of patronising quarrying mafia. The government, he said, did not take any action on the demand of Swami, who was asking for immediate stopping of quarrying in Ganga and shifting of Himalaya Stone crusher from Kumbh area.
The Congress is holding dharna and protest demonstrations across the State, Arya said, adding, he himself would sit on a dharna in Haridwar on Thursday to demand a CBI probe.
Swami Nigamanand, a seer of Matri Sadan ashram in Haridwar, died in the Himalayan hospital near here on June 13 after remaining in coma for 43 days. Nigamanand had begun his fast on February 19.
Source: PTI
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15 JUN, 2011, 01.55AM IST, SKANDITA AGRAWAL,ET BUREAU
Fee income growth key to Federal Bank's profitability
Federal Bank, one of the largest mid-sized private sector banks in terms of capital base, has been reporting robust financial numbers even in a rising interest rate scenario helped by strong distribution network and huge customer base.
High low-cost deposit base and well-diversified loan portfolio provide an edge to the bank over peers and enables the bank to maintain better margins consistently. This has been reflected in its stock market performance as well. In the past six months, the stock has gained 21% compared to a mere 0.1% return from ET Bankex .
Federal Bank has an optimum mix of overseas and low-cost domestic deposits that safeguards the bank's net interest margin in a rising interest rate scenario. Non-resident Indian clients contribute almost 26% to the bank's retail deposits, a segment that was largely unaffected during the financial downturn of 2008-09.
Healthy growth in NRI deposits will help the bank maintain its current account savings account (CASA) ratio at a record level of 30%. The bank's net interest margin, which is a measure of spread between the cost of borrowing and yield on loans, was 4.22% in 2010-11, the highest among small banks.
The bank has maintained a NIM of about 3.5% for nine years. In the fourth quarter, the bank's advances and deposits grew by 15.6% and 19.3%, respectively. The bank has managed to reduce its non-performing assets (NPAs) to 0.6% as of March. However, gross NPA ratio is slightly higher at 3.5% as a result of an increase in slippage in the past few quarters against 2.9% in last fiscal.
The bank restructured substantial corporate and small medium enterprise loans under the Reserve Bank of India's special dispensation. These loans may further slip into NPA categories, elevating the bank's credit risk in the near term.
The bank has not been able to grow its fee income business, which may hit profitability as fee income is likely to be a differentiating factor for banks, given that higher interest rates may affect their core income.
The bank's stock is trading at a six-month high price-book value of 1.5. However, these valuations can be justified if the bank's management efficiently deals with the concerns of non-income growth and asset quality.
http://economictimes.indiatimes.com/markets/stocks/stocks-in-news/fee-income-growth-key-to-federal-banks-profitability/articleshow/8856425.cms
15 JUN, 2011, 01.41AM IST, MEERA MOHANTY,ET BUREAU
Deep mineral exploration licence on on first-come-first-served basis
NEW DELHI: The government will offer exploration of deep-seated minerals on a first-come, first-served basis rather than by an auction to make the high-risk, high-investment sector attractive for private players. The mining ministry wants to restrict bidding to only prospecting and mining, the stages that follow initial exploration.
The ministry's proposal has also been accepted by the Ashok Chawla committee on allocation of natural resources, two people familiar with the development said. The new mining Bill will incorporate the recommendations, these people said. A group of ministers is currently discussing the Bill. A first-come, first-served approach is expected to increase investments into exploration as it would attract specialist mining companies for deep-seated minerals like copper, gold, diamond and nickel.
"The issue is not merely cutting the cake of mineral resources, but helping the cake grow in size over the long run," Mining Secretary S Vijay Kumar said. "World over, there is a recognition that the effort to get better value for a resource has to be structured along with, and in tandem with, a system that mitigates risk at the exploration stage." Kumar, however, refused to comment on the Chawla panel report.
While reserves of limestone, bauxite and iron ore occur closer to the surface and are known, India has little idea of its wealth of high-value deep-seated minerals. The National Mineral Policy of 2008 specifically aimed at giving a thrust to the exploration of these resources. "The deep-seated minerals cannot be auctioned for the reason that there has to be intense exploration with state-of-the-art technology, which requires heavy investment," said a senior ministry official. "Auctioning of such blocks could lead to highly speculative bids and increase chances of the mining investor not able to recover upfront investment."
"Asking for reconnaissance permits for deep-seated mineral deposits to be auctioned is almost like calling for bids for fishing in the sea," said Shakeel Ahmed , chairman, Hindustan Copper. The Chawla Committee has approved a first-come, first-serve approach towards reconnaissance licensing for the present.
It has, however, also recommended that provision be made for an independent regulator in the proposed Act to reconsider mechanism for competitive bidding in the future. "Auctioning would open up a pandora's box," said Sandeep Lakhwara , managing director of Deccan Gold Mines , a Bangalorebased gold exploration company. "It would bring in a host of large players with no serious technical expertise in exploration.
The first-come, first-serve policy will attract exploration and in the high-risk, high-reward game." Under the new Act, reconnaissance licensees starting with 10,000 sq km will relinquish land with no future claims, sharing data with the state as they progress. After three years, the lease area would be reduced to 500 sq km. At which point, if successful, the company can opt for a seamless prospecting licence. The state would, in the process, have gained baseline data for 9,500 sq km.
Government concerned over inflation, to take appropriate steps: Pranab Mukherjee
Expressing concern over rising inflation which surged past 9 per cent in May, Finance Minister Pranab Mukherjee today said the government would take appropriate action to contain prices.
"We would keep a close watch on developments, both domestic as well as international, in the coming months and make appropriate adjustments as we go along", he said in a statement.
The inflation, as per the data on the Wholesale Price Index ( WPI )), went up to 9.06 per cent in May from 8.66 per cent in April following an increase in prices of essential items like fruits, milk, petrol and manufactured goods.
Pointing out that inflation for May at 9.06 per cent was lower than 10.48 per cent recorded a year ago, Mukherjee said, "the picture for the latest month is however mixed."
While food and primary inflation has declined, "core inflation (that is other than food, fuel and power inflation) continues to harden...this poses some concerns which will have to be addressed", he said.
Referring to rising prices of essential kitchen items, he said, "other than fruits, inflation is moderating in all food items".
The rate of price rise in non-food primary articles, he said, is still high at 22.35 per cent, though it has moderated from 27.33 per cent in April.
This decline in inflation of non-food articles, Mukherjee hoped, would help in moderating the inflationary tendency in the economy in the coming months.
China and India are grabbing future jobs: Obama
WASHINGTON: Asking Americans to foc US more on science, mathematics and technology, US President Barack Obama said these are the subjects in which students from India and China are marching ahead and are grabbing the jobs of the future.
Travelling to Durham in North Carolina, Obama said companies in the US are having a tough time in finding right candidates in the field of science and technology, which he argued is not a good sign for the future of the country.
"Right now, there are more than four job-seekers for every job opening in America. But when it comes to science and high-tech fields, the opposite is true. The businesses represented here tell me they're having a hard time finding high-skilled workers to fill their job openings," he said.
Obama said only four per cent of all undergraduate students enroll in the STEM subjects -- science, technology, engineering, and maths.
Of those students, one-third will switch out of those fields, and only about two in five will graduate with a STEM degree or certification within six years, he added.
"So these are the jobs of the future. These are the jobs that China and India are cranking out. Those students are hungry because they understand if they get those skills they can find a good job, they can create companies, they can create businesses, create wealth. And we're falling behind in the very fields we know are going to be our future," Obama said.
"So we can do better than that. We must do better than that. If we're going to make sure the good jobs of tomorrow stay here in America, stay here in North Carolina, we've got to make sure all our companies have a steady stream of skilled workers to draw from," he said.
14 JUN, 2011, 03.31PM IST,REUTERS
In India's grain bowl, farms face threat from MNREGS
CHANDIGARH: Sitting at the edge of fields in the heart of India's grain bowl, Gurdayal Singh Malik shakes his head in resignation about the lack of workers needed for his 60-acre farm, blaming the government's flagship welfare program for the shortage.
Ever since the start of the program, which guarantees 100 days of work a year for rural households, the flow of migrant labour to northern Punjab and Haryana states has dropped to a trickle, forcing farmers such as Malik to hike farm wages massively -- and still he cannot find enough workers.
"Labourers used to come every year to the large landholders, asking for work. Now they pick and choose and go about saying: Sardar (master), we don't have time," said the 58-year-old farmer in Kurukshetra in Haryana, 170 kilometers north of New Delhi .
"Four or five years ago, it used to cost 500-800 ($11-$18) rupees to plant an acre of paddy. Last year the labourers took a tenth of the paddy and 3,000-4,000 rupees."
This rise in wage levels and farm costs in rural India is worrisome, with evidence it might be feeding into the high inflation that is the government's biggest economic headache and prompting a hawkish stance at the central bank.
Food and headline inflation remain above 8 percent a year despite nine rate hikes since March 2010, the most in Asia, by the Reserve Bank of India (RBI). Few expect a quick decline.
That persistence points to the limitations of the central banks' aggressive use of its anti-inflationary measures when confronted with structural problems such as labour shortages and supply-chain bottlenecks created by poor infrastructure.
"Much of inflation is coming from structural issues and the inability of the supply-side to respond to higher prices," Laveesh Bhandari, director of Indicus Analytics, said.
"The government is not able to solve these issues, so we have to rely on the RBI to tighten policy ... But everyone, including the RBI, knows this is not going to have an impact in the short term. It'll essentially only slow down growth."
In agriculture, labour shortages could reduce output over time. Farm labour shortages have been reported in places as far apart as the eastern state of Bihar and southern Tamil Nadu.
For years, labourers from the poor Bihar would travel to Haryana and Punjab, where a "Green Revolution" beginning in the 1960s boosted farm production and staved off widespread food shortages in the country of 1.2 billion people.
Now, as the Mahatma Gandhi National Rural Employment Guarantee Scheme (MNREGS) takes root in Bihar, the traditional seasonal migration has declined. Local labour is not adequate and itself is diverted towards MNREGS projects, accentuating the shortage on farms.
"If there aren't Bihari workers, farmers will soon have to give up farming," Malik said.
Rising wages is the latest woe to hit Haryana and Punjab, which produce one-fifth of India's annual rice and wheat output of 170 million tonnes, but which have seen stagnant yields, declining soil fertility and a depletion in ground water levels.
The country consumes 76 million tonnes of wheat and 90 million tonnes of rice yearly, and any shortfall in production will force it to import grains, pushing up global prices.
COSTS VS WELFARE Costing 1 percent of GDP, the MNREGS is the largest of India's welfare schemes designed to protect the country's 500 million poor who live on less than $1.25 a day. The program has been credited for returning the Congress-led coalition to power in 2009.
Critics say MNREGS is wasteful and riddled with corruption, and the infrastructure created is of shoddy quality.
A recent World Bank study on welfare programmes in India including MNREGS said they did not give the "bang for the rupee" warranted from such huge spending.
But mindful of its popularity, MNREGS has been backed by powerful Congress party president Sonia Gandhi . Her son Rahul Gandhi, seen as a prime minister in waiting, personally pushed for expanding it from 100 poor districts to all of the country.
Given the program's support, the government has no plan to recast the system or take up a suggestion that it be suspended during the harvest season or that farm labour be included in the list of works.
Under the program, any villager can go to a nearby government office and enroll for building roads, digging wells or creating other rural infrastructure and be paid the minimum wage for 100 days a year.
That income has helped improve food intake and reduce child labour, especially at times when crops fail or prices shoot up. It has raised rural consumption, which has created new markets and shored up growth when investment has faltered.
But the run-up in farm costs from MNREGS puts pressure on the federal government to raise the minimum support prices (MSP), or procurement prices, for wheat and rice, lifting what is effectively a benchmark for food prices.
Since MNREGS began in 2004/05, the first year of the Congress-led coalition government, the minimum support prices for wheat and rice have risen 1.7 times. Haryana and Punjab also have seen the highest increases in the consumer price index for farm workers.
"That is going to lead to a cost plus food inflation. If costs are going up, I am supposed to be protecting the margins of the farmers," Ashok Gulati, chairman of the farm ministry's commission on prices and costs, said.
Estimating that labour costs to have gone up 60 percent in the past three years, Gulati said it was a challenge to keep up with the rising expenses.
"But if I don't take these increasing costs into account, I'm not doing justice to the incentives of the farmers so the growth process is likely to slow down. So it's a very difficult challenge."
In Punjab, two weeks before transplanting of paddy starts, P.S. Rangi at the Punjab State Farmers Commission anticipates that labour shortages will persist.
"After expenses, there's little for a migrant to take back home. So when he gets an opportunity there, why would be come here?" said Rangi, a former head of agricultural economics at the Punjab Agricultural University.
"But transplanting has to happen. There's no other way, even if it means that school-boys who used to wear shiny clothes and watched from the sides have to shed them and get into the fields."
15 JUN, 2011, 07.12PM IST, SAMEER HASHMI,ET NOW
Pilots exit Air India to join private carriers
MUMBAI: More than 20 pilots have exited Air India in the last one month and joined private airlines. Many more pilots are expected to quit in the next few weeks according to three sources. This mass exodus got triggered after the pilots' went on strike last month.
Sensing the opportunity, private domestic players like Indigo airlines & Kingfisher airlines have made lucrative offers to Air India pilots. Some of the pilots have also joined International airlines like China based Spring airlines & Hong Kong based Dragonair. Tiger Airways & Qatar Airways have also made offers.
'The whole purpose of working in Air India was that it is a government owned company and there is job security. But when we don't get paid for months and there is a uncertain future looming, it better to join a private airline' said one of the pilots who is joining a private airline. Air India pilots have not got paid in the last three months.
All the pilots who have quit in the last one month did not serve the mandatory notice period. The airline is saddled with a debt of about Rs 40,000 crore, of which Rs 18,000 crore is working capital loans taken from a consortium of banks and the balance of Rs 22,000 crore is towards payment for new aircraft ordered.
Sources say, that more pilots will quit in the coming weeks as private players are making lucrative offers. Indian private players are expanding their fleet as the demand has picked up.
'There is a demand for trained pilots as everyone is adding more aircraft, so it makes sense to hire from Air India where pilots are looking for a change' said an senior executive of a private airline.
The airline is saddled with a debt of about Rs 40,000 crore, of which Rs 18,000 crore is working capital loans taken from a consortium of banks and the balance of Rs 22,000 crore is towards payment for new aircraft ordered.
US sticks to stand on arrest of Indian diplomat's daughter
Washington: Even as India reportedly lodged a "strong protest" with Washington over the arrest of an Indian diplomat's daughter in New York, the United States stuck to its position that family members of consular officials do not enjoy diplomatic immunity.
"We were aware of her status," State Department spokesman Mark Toner told reporters Tuesday when asked about the February arrest of Krittika Biswas, daughter of India's vice consul at its consulate general in New York, and the treatment meted out to her.
But "As I've said before, as a family member of a consular officer at the Indian consulate in New York, she did not enjoy immunity from arrest from criminal or civil jurisdiction under international law," he said.
"Certainly though, we value our partnership with India and we attach great importance to the presence of all Indian diplomatic and consular representatives in the United States. And we sympathize with Ms. Biswas and her family," Toner added.
Asked why Biswas wasn't given access on the first day of her arrest, the spokesman insisted: "I think she was allowed to call her family and her father, who was the consul general, I believe."
"She was allowed to contact them. And in terms of legal convention, I think it allows for notification of access without delay. But I believe she was only held for just the night and then released the next morning," Toner said.
When told that Biswas was released only the next afternoon after her lawyer came into the picture, the spokesman said: "What I can say is that, to our knowledge, she was allowed to contact her parents very soon after being taken into custody and she was released the next day."
Asked if the State Department got any official protest from the Indian government, Toner said: "I'm not aware of that. No."
The spokesman also said he didn't "have an answer" to reports that the US government replied after 20 days to an email from the Indian Embassy.
Source: IANS
Sensex plunges 176 points on rate hike fears
Mumbai: The BSE benchmark Sensex on Wednesday fell over 176 points to 18,132.24 as rate-sensitive banking and realty stocks tumbled ahead of the RBI policy meet on Thursday on fears of another hike in interest rates amid high inflation and a weak global trend.
The Bombay Stock Exchange index, Sensex, which had gained 43 points yesterday, dropped as investors dumped interest sensitive stocks on fears that inflation in May that breached the nine percent mark, may force the central bank to hike rates in its mid quarterly review.
A warning by Goldman Sachs Group that inflation would remain a 'key headwind' for the country's economy dampened the sentiment, already infected by a weak trend in the Asian region and lower opening in Europe.
Broad-based National Stock Exchange index fell by 53 points to 5,447.50, after dipping to 5,438.95 during the session.
On the BSE's 30-share index, RIL and Infosys -- the two most influential stocks that weigh about 21 per cent on the Sensex -- suffered heavy losses. The RIL lost Rs 12.80 to Rs 900.75 and Infosys by Rs 39.55 to Rs 2,833.90 a share.
Among the sectoral indices, the banking index took the maximum brunt, losing 1.58 per cent to 12,143.23 as the country's largest lender State Bank of India declined by Rs 51.95 to Rs 2,182, followed by ICCI bank that dipped by Rs 22.15 to Rs 1,033.05 a piece.
Realty sector index lost 1.34 per cent to 2,122.88 as Jaiprakash Associates, a builder of dams, roads and bridges, lost Rs 1.70 to Rs 82.50 on speculations that higher borrowing costs will hurt constructors and developers.
Among auto majors, Maruti Suzuki fell Rs 12.30 to Rs 1,210.50 after a strike at one of its factories entered its tenth day.
Source: PTI
RIL sale of 30% stake in oil & gas blocks cleared by MHA
New Delhi: Clearing the last hurdle, the Home Ministry has given unconditional approval for UK's BP to buy a 30 per cent stake in Reliance Industries' oil and gas blocks, including the showcase KG-D6 gas fields, for $ 7.2 billion.
The Ministry of Home Affairs wrote a one-page letter to the Petroleum Ministry on June 1 giving security clearance and a no-objection certificate for BP buying a 30 per cent stake in 23 oil and gas blocks of Reliance in India's largest foreign direct investment, a top Oil Ministry official said here.
While the NOC to the Reliance-BP deal is unconditional, the Home Ministry asked if Reliance could not have offered the stake to state-owned gas utility GAIL India or any other PSU.
"Our PSUs do not have the expertise Reliance has been looking for. It wanted an expert in deepsea technology and GAIL, which is a gas marketing and transportation company, hardly fits the description," he said.
Reliance wants to leverage the worldwide experience of Europe's second biggest energy company to resolve sub-surface technical issues at its KG-D6 gas fields, where production has fallen from 61.5 million standard cubic metres per day to about 48 mmscmd, instead of rising to the planned 69 mmscmd.
The Mukesh Ambani-led firm hopes BP would be able to fix reservoir issues at the Dhirubhai-1 and 3 gas fields in the KG-D6 block to rapidly raise output to the planned peak of 80 mmscmd and also help in formulating viable plans to bring to production other finds in the block and in other areas.
Industry observers scoffed at the idea of Reliance first offering the stake to firms like GAIL and asked whether the Home Ministry would suggest the same to Cairn Energy, which is selling its Indian unit to London-listed mining group Vedanta Resources.
State-owned Oil and Natural Gas Corp (ONGC) is already a 30 per cent partner in Cairn India's mainstay Rajasthan block and could easily takeover Cairn Energy shares.
They questioned the Oil Ministry's rationale of seeking security clearance for BP when the company is already operating oil and gas blocks in the country, has a huge lubricant business and a flourishing solar venture with Tata.
ONGC, the nation's largest state explorer, is in fact struggling to put together a viable development plan for discoveries it has made in a block adjacent to KG-D6 in the Krishna-Godavari basin. ONGC itself has been seeking partners for that block and had shortlisted BP as a potential ally.
The official said the Home Ministry has also asked if oil and gas can be exported. "That is ridiculous to even think.
Production Sharing Contract (PSC) bars export of oil and the Supreme Court has upheld the government's absolute powers to decide users of natural gas. So while India is energy deficit, no government can even think of exporting gas."
"There is no way that BP can take oil and gas produced from Reliance blocks to the UK," he added.
Europe's second biggest oil company, BP will pay $ 7.2 billion for a 30 per cent stake in 23 out of 26 exploration blocks held by Reliance and a performance payment of up to $ 1.8 billion if the tie-up leads to the development of commercial discoveries.
Reliance and BP will also form an equal joint venture for the import, marketing and transportation of natural gas.
After the NOC from the Home Ministry, the Petroleum Ministry will accord in-principle approval to the transaction, after which amendments to the Production Sharing Contracts (PSCs) of the 23 blocks would be effected to induct BP as a partner.
Reliance will retain operatorship of all 23 blocks.
"The BP-Reliance move to form a joint venture for transporting and marketing natural gas in India is widely expected to spell trouble for public sector gas major GAIL," the Home Ministry's June 1 letter said.
Stating that GAIL, ONGC and Oil India had to foot Rs 25,200 crore out of the Rs 75,600 crore retailers lost on selling fuel below cost, it said, "Oil PSUs' share in the marketing of natural gas would take a big hit if the BP-Reliance duo enters the segment in a big way, which it is expected to do so."
"30 per cent stake in Reliance's gas and oil assets could have been offered to GAIL or any other PSU which could have raised the $ 7.2 billion as a consortium," it added.
Also, the ministry said it needs to be "ascertained whether the New Exploration Licensing Policy (NELP) agreement/ contract under which Reliance bought the oil wells had a provision for the sale of assets and whether the Reliance-BP deal would enable BP to sell/transport gas outside the country."
The Oil Ministry official said NELP provides for farm-outs or stake sales and Reliance's agreement with BP was in perfect conformity with that.
The $ 7.2 billion Reliance-BP deal is seen as the biggest FDI into India. A much larger proposed transaction -- Posco's $ 12 billion investment announced years ago for a steel plant in Orissa -- is yet to take off.
Reliance is the operator in all the 23 blocks, while Canadian Niko Resources and UK's Hardy Oil have minority 10 per cent interest in a few. After the deal, Reliance' holding in the blocks will come down to 60-70 per cent. Nineteen out of 23 blocks lie off the East Coast, while two blocks are onland, in Assam and Gujarat.
Source: PTI
World stocks down as China, India rate hikes loom
Bangkok: World stock markets mostly slipped on Wednesday as investors anticipated growth-denting rate hikes by central banks in India and China to contain stubbornly high inflation.
Oil prices hovered around $99 a barrel after a report showed U.S. crude inventories fell more than expected, suggesting demand may be improving. The dollar was up against the euro and unchanged against the yen.
In early European trading, Britain's FTSE 100 slipped 0.2 per cent to 5,788.97. Germany's DAX and France's CAC -- 40 each lost 0.3 per cent. Wall Street was set to head lower, with Dow Jones industrial futures and S&P futures both down 0.5 per cent.
Asian shares fared only slighter better.
Japan's Nikkei 225 stock average closed up 0.3 per cent to 9,574.32. Honda Motor Corp. gained 2 per cent a day after the company announced that vehicle production in Japan is expected to be back at nearly normal levels by later this month and, outside of Japan, by August or September.
Japanese manufacturing was disrupted by a huge earthquake and tsunami on March 11 but analysts say the recovery at Honda and other Japanese automakers has been remarkable.
South Korea's Kospi also rose, by 0.5 per cent to 2,086.53. Other markets fell amid expectations that China's central bank will go ahead with at least one more interest rate hike this month or next.
Hong Kong's Hang Seng dropped 0.7 per cent to 22,343.77. Australia's S&P/ASX 200 lost 0.4 per cent to 4,566.80. Benchmarks in Singapore and Thailand were also down, while those in Taiwan and New Zealand rose.
China's May's inflation rate of 5.5 per cent was the highest since July 2008. Beijing has made taming price increases a priority but its measures could also slow growth in the world's second-largest economy.
On Tuesday, China's central bank lifted the ratio of funds banks must set aside as reserves by a half point. That action in itself may have dampened investor appetite, analysts said.
The benchmark Shanghai Composite Index lost 0.9 per cent to 2,705.43, while the Shenzhen Composite Index of China also fell 0.9 per cent to 1,118.17. Shares in Inner Mongolia companies were among the gainers, while shipping industry companies weakened.
Inflation is also buffeting India's economy, the third largest in Asia. The Reserve Bank of India, which has raised key policy rates nine times since March 2010 in an effort to tame inflation, is expected to raise borrowing costs again at a monetary policy review Thursday.
Dampening expectations of global growth has led investors to scale back on stocks, according to a survey of fund managers by Bank of America Merrill Lynch.
The survey of institutional fund managers, conducted between June 3-9, shows investment portfolios being adjusted in the face of falling world markets, with a significant reduction for equities. The net percentage overweight equities fell to 27 per cent from 41 percent in May, the survey said.
"EU sovereign risk is still cited as the major risk factor for investors," said a BofA Merrill Lynch Global Research report, referring to the debt crisis in Greece that has left the country teetering on the brink of default. A worsening of Greece's problems could spread panic in financial markets and drag down other struggling countries like Portugal, Ireland or Spain.
In New York, a government report Tuesday on retail sales in May was better than expected, driving stocks higher. The government said retail sales edged down 0.2 per cent last month, but economists had expected worse.
Excluding weak car sales, retail sales rose 0.3 per cent. Americans bought fewer cars during the month, but that was more a reflection of production disruptions caused by the earthquake and tsunami disaster in Japan.
The Dow Jones industrial average rose 1 per cent to close at 12,076.11. The Standard & Poor's 500 index rose 1.3 per cent to 1,287.87. The Nasdaq composite index rose 1.5 per cent to 2,678.72.
Benchmark oil for July delivery was down 65 cents to $98.72 a barrel in electronic trading on the New York Mercantile Exchange. The contract gained $2.07 to settle at $99.37 on Tuesday.
In currencies, the euro dropped to $1.4353 from $1.4468 late Tuesday in New York. The dollar strengthened to 80.67 yen from 80.52 yen.
Source: Associated Press
RBI may hike key rates by 25 bps: Bankers
New Delhi: With inflation hovering much above the comfort zone, the Reserve Bank may raise key policy rates by 25 basis points in its first mid-quarterly review of the credit policy for FY'12 on Thursday.
"I think the RBI would take one more small step to curb inflationary expectations. Market is expecting a 25 basis points increase," Indian Overseas Bank Chairman and Managing Director M Narendra said.
One thing is certain, inflation is beyond the comfort level and the RBI has already expressed its concern on many occasions, he said. In its annual policy document for 2011-12 released last month, the RBI had said that inflation control would be its primary focus in the near future, even as it agreed that the high rate of price rise would impact the country's growth story.
"Given the inflation condition, the general consensus is that RBI would raise rates by 25 basis points," said Punjab & Sind Bank Executive Director P K Anand. For the month ended May, inflation moved up to 9.06 per cent from 8.66 per cent in the previous month, mainly on account of a rise in the price of manufactured products.
According to IDBI Bank Executive Director R K Bansal, rising inflation numbers have raised the expectations of a rate hike by the RBI. "My feeling is that the central bank could further raise rate by 25 basis points," Bansal said.
The RBI has hiked key policy rates nine times since March, 2010, and is likely to continue with its tight monetary policy stance to tame inflation, which is edging toward double digits.
The central bank, in its annual policy, had accepted that inflation would remain a matter of major concern in the next few months on account of high global commodity prices, particularly of crude.
Analysts feel that repeated rate hikes have led to dwindling investment, which is turn has led to a slowdown in economic expansion. During the January-March quarter, the Gross Domestic Product (GDP) expanded by only 7.8 per cent, the slowest pace of growth in five quarters.
At the same time, factory output -- as measured by the Index of Industrial Production (IIP) -- grew by only 6.3 per cent in April, as against 13.1 per cent in the corresponding period last fiscal.
However, the central bank's priority would be to check price rise, analysts said.
According to IndusInd Bank Executive Vice-President Moses Harding, headline inflation shooting past the 8.5-9 per cent tolerance zone in May has set off alarm bells. There is now extreme pressure on the RBI to continue with its rate hike actions and maintain the repo rate as the operative policy rate for an extended period of time.
Source: PTI
Domestic IT biz to touch $51 bn by 2014
India's domestic IT services and products markets will touch Rs 1,71,698 crore in 2012 and the market is expected to grow at 17 per cent till 2014. This, according to research and advisory firm CyberMedia Research,
The overall India domestic IT services and products markets will touch Rs 1,71,698 crore in 2012, while the size of the segment will touch Rs 2,33,930 crore by 2014.
Anirban Banerjee , associate vice president of CyberMedia Research said "A large chunk of IT hardware and software products will witness good traction on account of the healthy growth in IT services as enterprises try to gain the best leverage out of their IT deployment."
India's growth will continue, with the domestic IT-enabled services markets expected to grow at a CAGR of 21.1% to touch Rs 98,188 crore by 2014.
Among the IT product segments, software is expected to grow by 20.1 per cent followed by servers at 13.3 per cent and personal computers at 12.9 per cent.
The report said that the India public cloud computing market was expected to grow at a 53% over the five-year period to touch Rs 2,434 crore by 2014. Penetration of cloud services in the India enterprise segment, which stood at 4% in 2010, will increase to 6.8% by 2012.
The report also mentions healthcare & life sciences, media & entertainment, retail, the government & education sector, smart infrastructure and energy & power utilities as the key industries that would emerge as potential growth drivers for the Indian IT services.
Source: BPO Watch India
Mamata threatens to sack food department officials
Kolkata, Jun 15 (PTI) West Bengal Chief Minister Mamata Banerjee, who visited the Food Department headquarters here today, said essential items were not reaching the poor and threatened to sack the officers responsible for it.
"Those from whom food is not reaching the people must be sacked," Banerjee told the department''s officers when they informed her that items meant for PDS were not reaching the beneficiaries because of a section of Food Department staff and some businessmen.
Describing the food department as one ''without a father and a mother,'' she said "nothing is monitored here. Funds are being spent on food items but it is not reaching the common people. This cannot be allowed to continue."
Warning the officers that they would be monitored, she said, however, that the government would not victimise anyone.
"We will all have to work together."
Banerjee advised Food Minister Jyotipriya Mullick to set up a monitoring committee with one representative from each of the 12 employees unions functioning at Khadya Bhavan. The committee would ensure proper functioning of the department so that essential food items reached the beneficiaries, especially those below the poverty line.
She also directed the department''s officials to set up a complaint box to be opened every three days. "All the complaints, however small, must be attended to."
It has been decided that Mullick would meet the Khadya Bhavan staff once a week to ensure its proper functioning.
Banerjee, who visited three floors of Khadya Bhavan, was annoyed to see dusty files strewn all over.
"Is there no monitoring? Is this how you run a department? This is the reason why so many people go without food (in the state)," she said.
Gadkari attacks Sonia, Congress returns fire
Kolkata/New Delhi: India's top two political parties were locked in a war of words Wednesday after Bharatiya Janata Party (BJP) president Nitin Gadkari questioned Congress chief Sonia Gandhi's democratic credentials and called that party a "mother and son" organisation.
Addressing party activists in Kolkata, Gadkari said India would never forget the "black chapter" of Emergency rule that then prime minister Indira Gandhi presided over 1975-77.
"If Soniaji tries to move away from the path of democracy and tries to impose Emergency, we will not tolerate it," he thundered. Gadkari also said Sonia Gandhi had no right to talk about corruption.
"Sonia Gandhi says she will fight corruption. It is like Pakistan saying they will fight terrorism. When Pakistan says it will fight against terrorism, we don't believe it. When Sonia Gandhi says she will fight against corruption, even the Congress does not believe it, nor do the people," he said.
The Congress hit back, describing his comments as "gutter level politics" and said Gadkari was not suited to head any political party.
"The BJP has dragged the discourse to gutter-level politics," Congress spokesperson Jayanthi Natarajan said. "Gadkari is unfit at any level to be a player in not only national but at any level of a democratic polity because of the venom and the lack of culture in his discourse."
She said Gadkari's comments against Gandhi showed his mindset and added that he came from an "ideology that breeds hatred, divisiveness and murder".
Gadkari also described as "fascism" the police crackdown on Baba Ramdev and his supporters in New Delhi that forced the yoga guru out of the city.
"The incident which happened at Ramlila Ground was Ravan Lila. The crackdown showcases the restlessness of the Congress-led UPA government. What happened is fascism and cannot be tolerated," he said.
"The Congress talks about the non-violent movement of Gandhiji and this is what you get when you conduct a non-violent movement," said Gadkari.
"Earlier, the Congress had imposed Emergency. The people of the India still remember that black chapter. I want to say that if Soniaji (Congress chief) tries to move away from the path of democracy and tries to impose Emergency, we will not tolerate it," he said.
Gadkari called the Congress "a party of mother and son".
"This Congress party is a party of mother and son. Everybody in this party, except the Gandhis, are servants of this family. Nobody is a leader except a Gandhi, others are servants. They are ordered by their madam (Sonia Gandhi) to serve and they serve," said Gadkari.
Gadkari also took potshots at union Finance Minister and Congress stalwart Pranab Mukherjee, saying that he can become a prime minister of India someday but he can never adorn the post of Congress president.
"Pranab-da has a wish of becoming the prime minister of India. He may get that post someday but he will never become a Congress president because that post is reserved for a Gandhi only," said Gadkari.
Source: IANS
Murdered girl's mother wants CBI probe, Mayawati says 'no'
Lucknow: Bowing to relentless criticism, Uttar Pradesh Chief Minister Mayawati Wednesday assured justice in the killing of a young girl, found hanging in a police compound, but declined to ask the Central Bureau of Investigation (CBI) to probe the case.
The anguished mother of the murdered 14-year-old, however, insisted that only a CBI probe would help resolve the case and alleged her daughter was gang-raped by policemen in the eastern district of Lakhimpur Kheri.
The Congress backed her demand, saying the state police could not be expected to deliver justice as they themselves were involved in the crime that has generated widespread shock. The Allahabad High Court has meanwhile sought a report, with the next hearing scheduled for Friday.
"We have arrested the key accused while efforts are on to track his two accomplices," Mayawati said. But the chief minister made no mention about the allegation of rape.
The girl was found hanging from a tree June 10 night in the Nighasan police station premises. The death was initially dismissed as suicide, but a second autopsy confirmed the girl was strangled. Lakhimpur Kheri is about 200 km from here.
"If the victim's family wants the case to be handed over to CBI, I am not against the idea," Mayawati said.
"But going by past experience and botch-ups by the country's premier investigation agency in the Arushi Talwar case, I would not want this case also meets the same end as the Arushi case."
She promised that "the guilty will be brought to book and none would be spared under any circumstances".
Mayawati said the Lakhimpur Kheri Superintendent of Police D.K. Rai had been suspended for serious lapses in handling the girl's death in a police compound. She said action had been taken against 11 other policemen as well.
Three doctors who conducted the first autopsy too have been suspended.
Ramchandra, an employee at the Nighasan police station, has been arrested. Sub-inspector B.K. Singh and constables Uma Shankar and Shiv Shankar have been booked for tampering with evidence. The dead girl's mother, however, said police were trying to suppress the truth.
"There are attempts to conceal the facts... What is being shown is not true. I have seen my daughter's body... She was raped. "I am not satisfied by the police investigation," she said, insisting that policemen raped her daughter and killed her.
The girl's death has sparked vehement criticism of the Bahujan Samaj Party (BSP) administration, which critics say has failed to curb growing crime in the state, particularly against women.
But claiming that the Crime Branch was doing an efficient job of probing how the girl died, Mayawati accused the opposition of trying to gain political mileage from the case. Meanwhile, a doctor who conducted the first autopsy Wednesday blamed police for "misinterpreting" the report.
"We are not at fault. It was a mistake on the part of police as they failed to comprehend our post-mortem report," A.K. Agarwal, one of three doctors who conducted the first autopsy, said in Lakhimpur Kheri.
"We were not told to probe the case with a suicide or murder angle. Our post-mortem mentioned the injuries on the victim's neck and leg," he said. Congress general secretary Digvijay Singh, the party in-charge in Uttar Pradesh, lashed out at Mayawati.
"There is no rule of law (in Uttar Pradesh)," he said. "There is jungle raj." He said Mayawati wanted to win the coming assembly elections with police help. "There should be a CBI inquiry."
Source: IANS
Hazare offers olive branch to govt.
Hazare tells govt that differences could be resolved through dialogue and not through confrontation; One man shouldn't impose views on others: Cong to Hazare
New Delhi: Amid a war of words between the government and civil society members over the Lokpal Bill, both sides will meet in New Delhi on Wednesday for its drafting even as Anna Hazare on Tuesday reminded the Ministers that differences could be resolved through dialogue and not through confrontation.
As the government and the Congress continued its attack on the civil society members, Hazare said he cannot force anyone not to level allegations like he was a mask of the Rashtriya Swayamsevak Sangh or the Bharatiya Janata Party, but said the civil society has every right to raise issues.
The activists, who have shot off letters to Prime Minister Manmohan Singh and Finance Minister Pranab Mukherjee, will push for the inclusion of Prime Minister, judiciary and MPs under the ambit of the Lokpal, an issue on which government is at loggerheads with the civil society.
"Differences can be resolved through talks but not through confrontation. We feel that the government has accepted some of our demands and a lot more needs to be done. There is time till June 30," he told reporters here. "If nothing happens, we will see then," he added.
He said the civil society will put forth their views during Wednesday's meeting and if their demands were not met, then they will start their agitation again. The last meeting on June 6 was boycotted by the civil society side to protest police crackdown on Baba Ramdev's hunger strike.
Asked about allegations that he was associated with the RSS and the BJP, Hazare said, "How can I put hand on their mouth (and prevent them from making allegations)? In my lifetime, I have never gone close to any political party. Every party is similar. Some are graduates in corruption while some others have got doctorates in corruption."
Queried whether he considered BJP a corrupt party, he evaded direct reply and said, "why should I say, you people know". On Congress' allegation that the civil society was undermining democracy, he said the civil society has become the masters of the country when it turned republic.
Emphasising that the government has to listen to people's opinion, he said there was nothing wrong in civil society highlighting issues as the government is a representative of the citizens and are answerable.
"We do not deny that Parliament is a big institution. But Parliament is not in Delhi alone. Have a look at the Constitution. The village parliament is bigger than the Parliament in Delhi. Nobody thinks about it. Who has send them to Parliament?" he said.
Hazare also said there is so much corruption. "People in the government act like kings. Thats why people should reflect on Congress leader Digvijay Singh said about bringing Prime Minister under the ambit of the Lokpal Bill. It is noy just Anna Hazare's question," he said.
Asked why they were not pulling out the drafting commitee as there was so much of mistrust, Kejriwal said they have to work with this. "At least, we can put on record our dissent note," he said.
One man shouldn't impose views on others: Cong to Hazare
Continuing its attack on Anna Hazare ahead of Wednesday's meeting of the joint committee to draft Lokpal bill, the Congress on Tuesday said it was not democratic that one person tries to impose his views and only Parliament and Assemblies can debate what laws should be made.
"It is not democratic that one person tries to impose his views on everybody. This cannot go on that any person rises and starts dictating that this should happen and this should not," AICC general secretary Janardan Dwivedi told reporters here.
He said a decision would be taken in a democracy only through public opinion and the debate on what bill should or should not be made can take place "only in Parliament and Assemblies" which represent people and are elected bodies.
Dwivedi also said people should put aside their "personal egos" to work in national interest.
Dwivedi said the party is in agreement with the views of Pranab Mukherjee on the issue as "after all there is a way in which democracy could function and there is a process for taking decisions. Democracy cannot function in an arbitrary manner. What will happen if tomorrow some civil society members say they do not accept results of Assembly elections."
Source: PTI
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