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Travel in the lap of luxury: Maharaja plans big for direct US flights
P R Sanjai / Mumbai July 15, 2007

PLANE TRUTHS: The Boeing 777 will feature new livery.

Air-India is planning to provide a host of new value-added services on its non-stop flights to the US.
Other than free pick-ups from airports, the airline will also provide onboard telephony and CCTV facilities for the first and business class travellers.

The state-owned carrier, which will soon induct Boeing B777-200 LR aircraft for its non-stop service, has also drawn up plans to provide a series of in-flight entertainment for its passengers on the Mumbai-New York flights, starting August 1.

Sources said Air-India would be taking delivery of Boeing B777-200 LRs by this month-end. “The aircraft would have wall-mounted satellite telephones that allow passengers to make calls to anyone, anywhere in the world while travelling. It would have landscape camera systems,” sources added.

Industry players pointed out that the national carrier was positioning itself as a premium service with non-stop flights as various private players are eyeing the US destinations with advanced in-flight entertainment (IFE) systems.

Recently, Jet Airways displayed its IFE systems on its Boeing B777 aircraft, which will fly to the US via Brussels in the three-class configuration.

The new 238-seater aircraft has been configured with 8 seats in the first class, 35 in the business class and 195 economy seats. Each first class seat, designed for privacy, is 23 inches wide and has a seat pitch of 80 inches, which can turn into flat 31-inch beds. Executive class will have a privacy divider between seats.

The airline executives said Air-India would be the first airline to offer its passengers the first class non-stop travelling experience between Mumbai and New York.

The B777-200 LR will have mood lighting in addition to the main cabin illumination system, providing passengers with a greater degree of control over individual lighting.

The airline is also offering the audio-video on demand (AVOD) system with 400 hours of video content in all the classes. The in-built audio jacks on every seat will be equipped with a special noise cancellation feature.

Passengers will also be provided PC power and USB ports integrated into each seat to enable the use of laptops, keyboards and MP3 players.

The new flights will significantly reduce travel time, with the airline planning to cover the Mumbai-New York route in 15.55 hours and the New York-Mumbai round in 15.15 hours. The flight duration is at least two hours less compared with the one-stop services offered by other airlines.
 
CEO racing to complete India's showpiece airport
The airport, expected to cost US$500 million, has been designed for 11 million passengers a year, up from the 5 million first planned, as traffic growth accelerated with an expanding economy.

Thats weird, the BIAL airport is an entirely new airport being built from scratch ! And it is a greenfield airport, and they are doing it for just around $500 mil??

The Delhi International Airport, was already there, and they are completely renovating it, and adding another terminal, and that is being done for over $1.2 Bil !!

Now how is it possible that its soo expensive in Delhi? Or are they making the Delhi Airport on a grand grand scale?
 
Thats weird, the BIAL airport is an entirely new airport being built from scratch ! And it is a greenfield airport, and they are doing it for just around $500 mil??

The Delhi International Airport, was already there, and they are completely renovating it, and adding another terminal, and that is being done for over $1.2 Bil !!

Now how is it possible that its soo expensive in Delhi? Or are they making the Delhi Airport on a grand grand scale?

I suppose $500 million could be for the main terminal to make it operational. As the time goes other terminals would be added at additional cost.
 
GDP of India expected to grow at 9.2 % in 07/08
HULIQ, NC

Indian economy is expected to show a marginal decline in GDP growth to 9.2 percent in the current fiscal from 9.4 percent in 2006-07 with services sector and industry maintaining the momentum, CII has said.

According to the chamber, the agriculture sector would show a moderate three per cent growth, against 2.7 percent in 2006-07.

Industry and services sector are expected to grow at 9.4 percent and 11.2 percent respectively during 2007-08.

"On the whole, CII expects the GDP growth to be 9.2 percent during 2007-08, with agriculture growing at 3 percent, industry at 9.4 percent and services at 11.2 percent," the chamber said in its 'state of the economy' report.

The Indian economy had registered a 9.4 percent GDP growth in 2006-07, highest in the last 18 years, due to a stellar performance by manufacturing and services sectors.

In its quarterly analysis of economy for the Jan-March period, the chamber said in spite of appreciating rupee impacting exports, country's GDP grew at 9.1 percent primarily led by 19.35 percent growth in corporate earnings.

It said appreciating rupee had a negative impact on profits of textile and leather sectors during the fourth quarter with profit margin expected to erode further to 10.4 per cent during the next six months.

Service sector companies registered a 45.68 percent growth in profits compared to 10.32 percent growth in the corresponding quarter last fiscal. Manufacturing sector, however, reported a slowdown in profits during the quarter to 7.91 percent from 15.17 percent in Q4 2005-06.

The chamber, however, cautioned that the continuous decline in oilseed production could act as a hurdle to agricultural growth in the country.

Oilseeds production has declined by 14.79 percent in the quarter in India under review which is expected to further increase the demand-supply gap for edible oils.

CII pointed out on the need to restructure domestic pricing policy of various crops as farmers are switching from oilseeds crops to more lucrative alternatives like wheat and gram.
 
India makes its global presence felt
By Walter T Molano
Asia Times, Hong Kong

Although China dominates the business headlines, India is becoming a contender in the global marketplace. Initially focused on services, Indian manufacturers are joining the battle. Chinese manufacturing exports are six times as large as their Indian counterparts. However, India's manufacturing output is increasing at an annual pace of 7%.

The auto-parts sector is where Indian manufacturers are having the most impact, entering the space vacated by US producers

when oil prices rose. As a result of the new opportunities, capital inflows are rising. In addition to foreign direct investment (FDI), portfolio investment is pouring in. At the end of May, the capitalization of the Indian stock exchange breached the US$1 trillion mark, putting it in the major leagues.

The massive investment flows are creating some complications. The acquisition of imported equipment and machinery needed to modernize the country's capital stock is fueling a current-account deficit. Moreover, the capital inflows are putting upward pressure on the rupee, appreciating 9% year-to-date against the US dollar. However, the heavy pace of investment is propelling the Indian economy. The country's gross domestic product (GDP) grew 9.2% year on year during the first quarter of the 2007, making India an important player in the global marketplace.

The rapid pace of GDP growth is creating inflationary pressures. India's inflation rate could finish the year above 6%, even though the official target is 4-4.5%. As a result, the Reserve Bank of India began tightening monetary policy. The move had a noticeable impact on lending rates, pushing mortgage rates to 12% from a low of 7.5%. Nevertheless, bankers reported no major reduction in mortgage applications.

The impact was more noticeable in the sales of automobiles and durable goods, which increased year on year only 2.9% and 1.6%, respectively, in March. The insensitivity of the mortgage market to changes in interest rates reflects the country's tremendous housing deficit. Government officials hope that tighter monetary policy will dampen the annual GDP growth rate to a more sustainable 8%.

The heady pace of economic growth is straining the India's infrastructure. Power blackouts are becoming a way of life in large cities such as Mumbai. Engineers estimate that the country will need to double its electricity infrastructure every five years for the next 20 years as it approaches consumption levels of more developed countries. India's per capita electricity consumption is one-third of China's and a twelfth of the United States'.

The ravenous hunger for energy is also making India a major competitor for oil and gas. Self-sufficient only a decade ago, it is now an importer of energy. Indian energy demand is growing at double-digit rates, forcing its oil companies to search abroad for additional resources. Oil and Natural Gas Corp (ONGC) is actively scouring the world for new fields and exploration rights.

The aggregation of the Indian juggernaut to the global economy will increase the overall demand for natural resources. Many people consider the commodity boom to be entering a mature stage. However, nothing could be further from the truth. The reincorporation of China and India into the global economic community after a hiatus of more than half a century is going to push commodity prices higher for the foreseeable future.
 
Lifestyle funds: Will they be the next big story?
16 Jul 2007, 0432 hrs IST,Madhu T,TNN

Lifestyle is a popular word these days. Your doctor associates it with certain ailments. Your insurance and investment advisors throw the word at you to persuade you to sign on the dotted line. No wonder mutual funds are hopping on the bandwagon: Kotak Lifestyle fund and Birla GenNext fund have been around for a while, and UTI's Lifestyle fund is currently open for subscription.

As the name suggests, these funds will invest in firms that will benefit from changing consumption patterns in the growing Indian economy. Since many argue that consumerism is a key driver of Indian economy, this must be a great opportunity, right? Well, sort of.

"The MF industry is really short of ideas," says Amar Pandit, director, My Financial Advisor. "They want to launch a new scheme every six months to raise the assets under management." However, he adds that unlike some recent schemes "which lacked a relevant theme, the lifestyle theme is quite nicely packaged." One mutual fund manager says, "Lifestyle is a very relevant theme these days. I think the sector would do really well as the economy accelerates."

Simply put, such a scheme is somewhat like a diversified fund, except that it would refrain from investing in certain sectors, such as capital goods and information technology (IT). "Except for these exclusions, the portfolio of these schemes would look more like a diversified scheme," notes Pandit.

So, should one invest in a lifestyle fund?

Pandit argues that although the theme is appealing, you would be better off investing in a diversified scheme. Many financial advisors concur. They feel there is no point to investing in an almost-diversified scheme. "Excluding IT and capital goods is not a great idea. In fact, you will benefit from these sectors in a well diversified scheme," said a financial advisor who did not want to be quoted.

So, if you are planning to invest additional money in a MF scheme, it makes more sense to choose an existing diversified scheme from a reputed fund house, which has performed well in the last five years. That would be a better and safer way to create wealth.
 
Ad hoc relief for exporters
S Shivakumar, merinews
16 July 2007, Monday

It is high time the govt. realised that charity begins at home. Instead of lending to prosperous economies at dirt cheap rates of interest, it can finance its own exporters and importers at a competitive rate and accelerate economic growth.

ONLY RECENTLY I wrote (vide Cost of Export Credit Needs to be Reset) that the government of India (GoI) would typically meet the demands of our exporters (against the backdrop of the rising rupee) half way, say, by temporarily allowing higher duty drawback rates, higher duty entitlement pass book rates and a slightly lower cost of export credit.

Well, if you go through the details of the Rs 1,400-crore relief package announced last week by the GoI for our exporters, you will realise that most of what I wrote has come true. I say most because GoI has allowed interest relief on export credit only in respect of nine identified sectors. You need not be a rocket scientist to predict GoI’s reaction to such crisis situations. GoI comes out with remedies, that too ad hoc, only after it is swamped with SOS from exporters - not for it the rigmarole of finding a permanent solution to the vexed problem after carefully vetting the issues involved.

As I said in the previous article, a fluctuating currency is the hallmark of a growing economy. Even the developed economies cannot claim that their currencies do not fluctuate – the highly export-dependent Japanese know this too well. But then you may be inclined to remark that their exporters do not crib whereas ours do. Your remark of course is right but for the cribbing part – it is not cribbing; it is a candid expression of a genuine grievance. Our exporters are not blessed with the same infrastructure advantage that they are blessed with.

To compensate our exporters, disadvantaged by an apology of an infrastructure, we should pass on to them the savings achieved on our imports (whenever the INR appreciates) in the form of cheaper funds. Our government generates at the most 1.5% (net of hedging expenses) on a part of the huge forex reserves that it invests in USD-denominated securities. Surely it can generate much more than that if it lends even a fraction of the said investment to our exporters and importers at 5%. It makes no sense for a poor country like India to lend to the world’s most prosperous country (USA) at 1.5% while denying a similar privilege to its own exporters and importers who contribute their mite to the country’s economic growth.

It is difficult to believe if we are told that our economy lacks absorptive capacity especially when smaller economies like Vietnam can be comfortable with capital flows of up to USD 150 billion! Here I would not like to compare our absorptive capacity with that of China because such a comparison is cruel – after all, our interest rates are determined by the market.

A permanent solution has to be found to this vexed problem since it is bound to arise fairly regularly in the days to come in the trillion dollar Indian economy. It is already believed in informed circles that the INR can appreciate to 35-36 levels vis-à-vis the USD. If the government believes that knee-jerk reactions can take care of the problem, then it is unfortunate.

No problem is solved through ad hoc measures or by sleeping over it. Better tackle it head-on today. Tomorrow may be too late.
 
Growth self-accelerating, says Reddy
BS Reporter / Mumbai July 3, 2007

Yaga Venugopal Reddy, Governor, Reserve Bank of India, said there is tangible evidence of self-accelerating growth of the Indian economy.

"From an annual average growth rate of 3.5% during 1950 to 1980, the growth rate of the Indian economy accelerated to around 6% in the 1980s and 1990s. In the last four years (2003-04 to 2006-07), the Indian economy grew by 8.6%. In 2005-06 and 2006-07, it had grown at a higher rate of 9% and 9.4%, respectively," Reddy said while addressing the Central Bank of the Russian Federation on Monday.

Reddy added: "An important characteristic of the high growth phase of over a quarter of century is resilience to shocks and considerable amount of stability. We have witnessed one serious balance of payments crisis triggered largely by the Gulf war in the early 1990s. Credible macroeconomic structural and stabilization programme was undertaken in the wake of the crisis. The Indian economy in later years could successfully avoid any adverse contagion impact of shocks from the East Asian crisis, sanction like situation in post-Pokhran scenario, and border conflict during May-June 1999. Seen in this context, this robust macroeconomic performance, in the face of recent oil as well as food shocks, demonstrates the vibrance and resilience of the Indian economy."

According to the speech released by the RBI on its website today, Reddy also said there were signs of deceleration of credit growth recently.

"The acceleration of growth in the real estate sector has been reflected in the upward shift in the growth trajectory of credit extended by commercial banks, which in the past three years has been unprecedented in the history of the Indian economy. There has been some sign of deceleration in the recent period," he said.

Reddy repeated that the central bank expected economic growth of 8.5% in the fiscal year ending March 31, 2008, and wanted to contain inflation close to 5%.

Reddy also reiterated the stand of gradual reforms in the financial sector. "In view of the proven success of our overall approach to reform over the last fifteen years, there is considerable merit in pursuing the gradualist, participative and harmonious approach towards further reforms in financial and external sectors. Since it is generally accepted that financial and external sectors in India are reasonably strong and resilient, high priority is being accorded for further reforms in the fiscal sector, agriculture, physical infrastructure, especially in power and urban areas, and delivery of public services such as water, health and education.

"Progress in these sectors will help, over the medium term, enhance competitiveness and accelerate reforms in financial and external sectors, in a harmonious and non-disruptive manner, thus, reinforcing self -accelerating growth with assured stability."
 
Alamgir,

Whats the point of posting old news when the thread is kept upto date in chronological order by Bushroda, Malay and myself on almost daily base? Please do not spoil it.
If you're really interested in gaining knowledge or engaging debates or having a Q & A sessions you're most welcome to join us.

Sincerity is usually displayed in balanced posting, unfortunately all you've been doing is spreading negativity all around. I truely regret that!

Please take some time to think about it before making your next post.

Thanks,
Neo
i read at least all posts which shows just one side of coin all my post not years old, and how can start a debate when a small portion of other side is not tolerable by mod. of pdf,sorry next time i will start my post with.....“Saare jahan se achha Hindustan hamara
 
India-Sudan ties may sour over OVL pipeline


NEW DELHI: India's relations with Sudan appear to have got into a knot over a petroproducts pipeline in that country built by OVL, the overseas investment arm of ONGC.

After delaying payment of three installments towards the cost of the pipeline, Sudan's ministry of mining and energy is mum on clearing the next installment, that will become due on June 30, or paying interest for delayed payments.

OVL completed the 741-km pipeline connecting Khartoum refinery to Port au Sudan in August 2005, two months ahead of schedule, at an investment of $194 million. This included a $15 million component for financing of pumping stations etc. As per agreement with OVL, Sudan's ministry of energy and mining was to pay back investment in 18 half-yearly equated instalments of $14,134,790 each.

The contract also lists as the first option the provision of ONGC Videsh recovering the instalments by taking crude oil instead of cash. As per this clause, Sudan was to offer the oil three months before an instalment became due to allow ONGC Videsh to tie up shipping and supply or trading arrangements.

Oil ministry documents show Sudan has not kept its word and has not allowed OVL to exercise the option of taking payments. Of the three instalments paid so far, the first was delayed by two months, second by one month and the third by over four months. OVL is yet to hear on the next installment and interest claim due to delayed payment of earlier installments besides three claims made for additional work done as per Sudan government's demands.

After a series of meetings between ONGC executives, officials from Sudan's ministry of mining and energy, representatives of SPPC - the Sudan government-run company that executed the project and operates pipeline - promised in March that they will send within 10 days to government a proposal for settling OVL's claims of $47 million.

Nothing, however, moved and OVL took up the matter with top officials of Sudan's ministry of energy and mining in May and June, only to be greeted with silence from the other end.
 
Corridor to pass via MP now


NEW DELHI: Japan, which is partnering India in the Delhi-Mumbai Industrial Corridor, has agreed to let the $100 billion project pass through Madhya Pradesh giving a boost to industrialisation in the home state of commerce and industry minister Kamal Nath.

The Delhi-Mumbai Industrial Corridor (DMIC) Corporation, which will implement the 1,483-km project along the proposed high speed rail freight corridor, will be launched by Japanese Prime Minister Shinzo Abe and Prime Minister Manmohan Singh here next month.

Japanese are the key funding partners in the freight corridor project. Both the countries are keen to replicate the model for the DMIC project too.

"On my request, the Japanese have agreed to increase the expanse of the corridor to 250 km on either side of freight route bringing a large area of Madhya Pradesh in the project territory," Nath said.
 
There it is !!
Poltical leaders taking their age old routine again! Trying to make it past their home states!
 
Govt ready with its own model of Temasek


NEW DELHI: The government and Reserve Bank of India are nearly ready with an indigenous model of Singapore's Temasek — a government-owned investment vehicle that will use foreign exchange reserves.

But unlike Temasek, the Indian company — that will be a special purpose vehicle registered either in Singapore or London to undertake wholesale banking activities — will only deal in loans and will not provide equity capital.

Besides, the focus will be on infrastructure and the SPV will provide loans to Indian companies that are buying equipment overseas or lend to domestic oil companies acquiring oil or gas assets overseas or building pipelines that terminate in India.

The only issue yet to be firmed up is the modalities for transferring money from RBI to the SPV. While law does not allow RBI to lend to the SPV, the finance ministry did not appear very keen on the refinance route suggested by the central bank since it could raise the cost of funds. Under this route, the SPV will have to first raise money to lend and then receive the amount from RBI. A third option is to let the SPV subscribe to bonds issued by RBI but even that appears to be a grey area.

"RBI has been asked to look at other options too since the idea is to provide low cost funds to Indian companies investing in building infrastructure," said a source.

For companies availing a loan from the SPV, debt will be treated as ECBs and would be subject to all norms applicable to ECBs, said a source.

By lending overseas, the government hopes to ensure that the problem of raising money supply into India is addressed.

But critics of drawing down foreign exchange reserve pointed out that the model does not help improve the state of roads or ensure better electricity supply.

Besides, it could not just affect Bhel and L&T's order book since companies would be able to raise cheaper funds overseas to buy equipment but could also result in the large international players shying away from investment in India.
 
RBS to double India headcount


NEW DELHI: British banking giant Royal Bank of Scotland, which has countered its Barclays' takeover bid for largest Dutch bank ABN Amro, plans to double its India headcount to about 1,000 employees by the end of this year.

RBS, which has an India development centre at Gurgaon with about 600 employees currently, is aiming to tap the "world-class IT talent base" present in India to support its global operations.

"We have a robust long-term India strategy. We would be doubling headcount to about 1,000 people by year end. India has a world-class IT talent base and we would like to leverage this opportunity," RBS India Development Centre MD Gary Strain said.

RBS, the third largest bank in Europe, serves more than 35 million customers worldwide and its India centre develops business-critical technology applications for RBS Group.

"The roles (at India centre) are truly global and talent gets groomed to operate in a global environment. This coupled with a strong people development agenda positions us uniquely in the market," Strain added.

In a bid to boost its India operations further, the bank recently appointed Barclays's India co-CEO Madan Menon as the country head for its global banking and markets division. Menon would be responsible for building RBS' capabilities in fixed income products, syndicated loans, debt markets, risk management, acquisitions.

The investment banking sector in India has witnessed a makeover over the years. The scenario changed dramatically, with a remarkable rise in market trading volumes, growing number of mergers and acquisitions and international fund raising exercises by Indian companies.

Global financial giants such as UBS, Deutsche Bank, Goldman Sachs and Lehman Brothers are already present in the Indian investment banking market.
 
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