e02dcIndustry News Digest (Issue No. 4)

8/3/2019 e02dcIndustry News Digest (Issue No. 4)

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I ND US T RY NEW S D I GES T

VOLUME 1 NO. 4

01 - 15 OCTOBER, 2010

Current State of Indian Economy: Page 2

PUBLISHED FORTNIGHTLY BY:

MOC LIBRARY

AMITY UNIVERSITY, LUCKNOW CAMPUSLUCKNOW


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PREFACE

The Industry News Digest is a fortnightly publication. It attempts to serve as medium for

rapid dissemination of industrial information to our users.

In this issue, one article on Indian Economy has been incorporated at the beginning.

Abstracts in this document have been scanned from The Economic Times, the renowned

business newspaper and most of the articles are related to industry.

It is expected that this issue will also reach a wide and interested users. We will be pleased

to receive the healthy criticism and improvement proposals.

In case the full text or any other information is desired, the same may be obtained from thelibrary.


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SUBJECT INDEX

SUBJECT PAGE NUMBER

An Article on Current State of Indian Economy 2

Automobile Industry 18

Banking/ Credit Services 21

Biotechnology 23

Drugs/ Pharmaceuticals 24

Education and Training 29

Electronics/ Telecommunication 33

Energy/ Energy Resourses 34

Global/ Indian Economy 36

Human Resource Development 38

Hotel/ Hospitality Management 42

Industry News 44

Information Technology 47

Infrastructure 52

Insurance Sector 54

Investment 55

Media and Entertainment 56

Micro Finance 57

Non Government Organization 58

Retail 59

Steel Industry 60


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2

Current state ofIndian Economy

August 2010


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HighlightsAugust2010

July 2010 overall industrial growth numbers continued on the path of buoyancy. The high growth

in the overall industrial output was solely on account of the heavyweight manufacturing sector.

The other two sectors also remained in the positive zone in July and during the period from April

July 2010. However, the growth inoutput was lower than the growth seen in the corresponding

period ofprevious year (FY10). Going by the use-based classification we see a huge rise in the

production ofcapital goods which rose by 63 percent in July 2010 as compared to the rise of 1.7

percent in the same month of previous year. The growth in the consumer goods output swelled

onlyon account the durables segment.

The industry segments that registered a sizable increase in output were food products, cotton

textiles, jute products, paper products , rubber and plastic products, petroleum , coal and tar,

metal products and among the capital goods were the machinery and equipment , transport

equipment and parts.

The growth momentum of the six core infrastructure industries was maintained with the

increase in petroleum products ( crude petroleum and petroleum refinery). Production in coal

and power remained positive, however, the growth numbers were not higher than the previous

year. The two segments that were found in the negative territory were cement and finished

steel.

The moderation in overall inflation could be observed in July 2010, 10 percent in July from 11

percent in the previous month. However, inflation was found to be much higher when compared

with the inflation recorded in July last year and may require more time and steps bythe

government to cool down to targeted levels. The prices of items /article groups that fueled the

overall price to rise to such levels were the food and non-food articles (primary goods), fuel

products, beverages, textiles, wood, rubber, chemicals, basic metals, machinery and transport

equipments.

The broad money supply rose by 3.4 percent over the period from April to July 2010-11, this was

lower than the M3 recorded in same period of previous year. The aggregate deposits was alsoseen to expand slowly by 3.3 percent during the period from April to July of the current fiscal as

compared to the expansion of 6.2 percent during the same period of 2009-10. The bank credit

rose by 3.5 percent calculated in July over April 2010.

The total revenue of the government stepped up sharply this year with more than twofold

increase, from the Rs 105378 crores up to July 2009-10 to Rs 238524 crores up to the month of

July of current fiscal . Consequently, the magnitude of fiscal deficit has contracted by almost 43

percent during this period of 2010-11 over the previous year.


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According to RBI, government acquired higher than anticipated revenue in July from the auction of

3G and BWG and revenue from taxes helped the holding back of fiscal deficit within the

targeted level of 5.5 %.

The buoyancy in tax collection in July has been on account of impressive collection in the direct

and indirect taxes. However, in growth terms the indirect tax was observed to be much higher

as compared to the growth in direct taxes.

The indices continue to swing between 16 K to 17K points. In July 2010 it rose to the level of

17.5 K points and currently in September 2010 we saw the Indian stock market rise to the level of20

K points again.

The overall merchandise exports slowed to 13 percent in the fourth month ( July) of the present

fiscal as compared to the 30 plus percent growth registered in the previous month of this year. It is

early for any comment on the trend without the trade numbers ofAugust and September.

The total foreign investment swelled to 10.8 billion up to July on the back of inflows in the portfolio

investment category. High investment activity by the FIIs was witnessed during the month, this high

inflows iswhat has led to increased portfolio investments ( USD 9.1 billion). FDI received during the

month was only USD 1.7 billion .

Further increase in the forex reserves has been witnessed; this has been observed to rise from

USD 275 billion to USD 284 billion and enough to cover 11 months ofimports.


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Contents

Title Page

1 Industrial Growth 7

2 Core Infrastructure Industries 9

3 Trends in Inflation 10

4 Monetary Indicators 11

5 Stock Market Trends 12

6 Fiscal Management 13

7 Foreign Trade 15

8 Capital Inflows 16

9 Foreign Exchange Reserves 17


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ListofTables

Table- 1.1: Growth ofIndustry: Recent Trends (in percentage)

7

Table -1.2: Growth in 17 Industry sectors 8Table-1.3: Growth in six-core infrastructure industries (% change) 9

Table-1.4: Growth in six-core infrastructure industries (% change) 9

Table-1.5. Monthly trends in Wholesale price index- monthly average (% change) 10

Table-1.6: Monthly trends in consumer prices (% change) 10

Table-1.7: Monetary sector indicators 11

Table-1.8: Monthly trends in stock market indices 12

Table-1.9: Trends in cumulative tax collections of central government (%) 13

Table-1.10: Service Tax 14

Table-1.11: Trends in central government finances: 14

Table-1.12: Monthly trends in growth of merchandize trade (% change) 15Table-1.13: Monthly trends in foreign investments ($ million) 16

Table-1.14: Monthly trends in foreign exchange reserves ($ billion) 17


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1. Industrial growth

The IIP growth numbers released in September for July 2010 showed that the overall industry posted

13.8 percent growth, which is higher than the growth of 7.2 percent posted in the corresponding month

of previous year. The three constituents of the overall industry namely the mining, manufacturing and

electricity were seen to grow positively. However, what mainly led to the sizable increase in the overall

growth was high growth of 15 percent in the manufacturing sector in contrast to the increase of 7.2

percent inthe previous year.

The use-based classification shows that production of basic goods , capital goods, intermediate goods

grew at 5.1 percent , 63 percent and 9.1 percent in July 2010 as compared to 4.7 percent , 1.7 percent

and 9.1 percent respectively in the same month of previous year. The growth in the consumer goods

decelerated slightly from 9.7 percent previously to 6.7 percent in the current year. The consumer

durables segment clocked the same growth rate as in the previous year.

The industry sectors which among the 17 industry sectors saw an increase were the food products that

increased by 9.1 percent ( -0.1 percent), cotton textiles by 12.1 percent (0.5 percent) , jute products by

19.3 percent (-28.1 percent ), paper products by 7.3 percent ( 1.7 percent), rubber , plastic , petroleum

and coal products by 19.4 percent ( 12.5 percent), metal products rose by 14.8 percent ( 12.6 percent ),

machinery and equipment and transport by 49.4 percent (12.0 percent ) and transport equipment by

24.9 percent (10.9 %) .

( The numbers within braces are for the previous year )

1.1: Growth ofIndustry: Recent Trends (in percentage)

Weights July

2009

July

2010

Industry 100 7.2 13.8

Mining 10.2 8.7 9.7

Manufacturing 79.4 7.4 15.0

Electricity 10.5 4.2 3.7

Use Based Classification

Basic 35.6 4.7 5.1

Intermediate 26.5 9.8 9.1Capital 9.3 1.7 63.0

Consumer Goods

Consumer non Durables

28.7

23.3

9.7

5.3

6.7

0.5

Consumer Durables 5.4 22.1 22.1


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Table- 1.2: Growth in17 Industry sectors

17industrysectorsFood Products 9.1 -0.1 9.1

Beverages, Tobacco and Related Products 2.4 3.7 -2.1

Cotton Textiles 5.5 0.5 12.1

Wool, Silkand man-made fiber textiles 2.3 34.0 1.2

Jute and other vegetable fiber Textiles (except

cotton)

0.6 -28.1 19.3

Textile Products (includingWearing Apparel) 2.5 5.9 -0.7

Wood and Wood Products; Furniture and Fixtures 2.7 1.7 -9.4

Paper &Paper Products and Printing, Publishing &

Allied Industries

2.6 1.7 7.3

Leather and Leather &Fur Products 1.1 14.9 -1.8

Basic Chemicals & Chemical Products (except products of

Petroleum & Coal)

14.0 6.9 2.5

Rubber, Plastic, Petroleum and Coal Products 5.7 12.5 19.4

Non-Metallic Mineral Products 4.4 6.5 0.0

Basic Metal and Alloy Industries 7.5 3.7 4.6

Metal Products and Parts,e

xce

pt

Machineryand Equipment

Machinery and Equipment other than Transport

Equipment

2.8 12.6 14.8

9.6 12.0 49.4

Transport Equipment and Parts 4.0 10.9 24.9

Other Manufacturing Industries 2.5 -0.7 31.1

Source: Central Statistical Organization


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08-09 09-10 10-11 08-09 09-10 10-11 08-09 09-10 10-11

April 4.3 -4.5 5.3 10.4 13.2 -2.3 1.4 6.7 6.0

May 0.1 -4.3 7.7 8.8 10.4 0.1 2.0 3.0 6.4

June 5.6 -3.8 2.9 6.1 15.2 0.9 2.6 7.7 3.4

July 11.8 -14.4 13.7 5.5 10.5 4.5 4.5 3.8 3.8

August 2.5 3 1 5.9 12.9 0.8 10.6

September 2.8 3.4 11.2 6.5 4.4 7.9

October 5.0 7.2 10.6 5.0 4.4 4.7

November -1.1 4.9 9.7 4.6 2.6 3.3

December 3.0 0.8 11.2 2.5 1.5 6.7

January -1.3 3.8 6.7 6.0 1.8 5.6

February 0.5 0.8 6.0 6.8 0.6 7.3

March 3.3 -0.4 5.2 7.8 6.3 7.8

2. Core sector growth

The core infrastructure industries were seen to maintain growth during the four month period ofFY11. In

July growth in the overall core sector was 3.9 percent as against the growth of 3.2 percent attained in the

same month previous year. Four sectors namely the crude petroleum, petroleum refinery, coal and

power were seen to post positive growth of 15.8 percent, 13.7 percent, 4.5 percent and 3.8 percentduring the month as against the negative growth of 0.4 percent , (-) 14.4 percent, 10 .5 percent and 3.8

percent respectively in the previous year. The categories that posted negative growth in July this year

after three months ofpositive growth were the finished steel and cement industry.

Table-1.3: Growth in six-core infrastructure industries (% change) July 2010

All

infrastructure

industries

Finished steel Cement Crude

petroleum

April

08-09

4.6

09-10

3.7

10-11

5.1

08-09

7.5

09-10

-1.3

10-11

4.7

08-09

6.9

09-10

11.9

10-11

8.7

08-09

1.0

09-10

-3.1

10-11

5.2

May 4.4 3.2 5.0 8.3 2.8 2.5 3.8 11.8 8.6 3.2 -4.3 5.8

June 4.4 6.3 3.4 8.1 3.6 3.5 6.6 12.7 3.6 -4.7 4.0 6.8July 5.2 3.2 3.9 6.3 4.0 -0.9 5.5 13.8 -0.2 -3.0 -0.4 15.8

August 2.0 6.5 3.3 0.3 1.9 17.6 -1.0 -2.6

September 4.1 4.5 2.3 0.8 8.1 6.5 -0.4 -0.5

October 2.4 3.8 -3.8 2.5 6.2 5.2 -0.2 -2.2

November 0.8 6.0 -6.3 11.7 8.7 9.0 0.5 -1.5

December 0.7 6.4 -8.0 9.6 11.6 11.0 -0.3 1.1

January 2.2 9.4 3.2 16.2 8.3 12.4 -8.1 9.7

February 1.9 4.5 2.4 0.9 8.3 5.8 -6.2 4.0

March 3.3 7.2 -1.8 9.2 10.1 7.8 -2.3 3.5

Source: Ministry ofIndustry

Table-1.4: Growth in six-core infrastructure industries (% change)

Petroleum

refinery

Coal Power


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3. Inflation

Inflation continues to remain one of the top concerns. The WPI based inflation still remains above the

double digit mark. Currently inflation is above 10 percent, way off the targeted 5.5-6.0 percent for the

current fiscal. The inflation isfueled by the prices of primary articles (both food and non- food ), fuel .

Prices were also seen to rise in the case ofmanufactured articles such as textiles, wood, rubber,

chemicals, basic metals, machinery and transport equipments.

Table-1.5. Monthlytrends in Wholesale price index- monthly average (% change)

2009 2010

All Commodities

June

-1.0

July

-0.5

June

11.1

July

10.0

I Primary Article 6.5 7.6 18.1 14.9

(A) Food Articles 10.9 14.2 15.6 10.3(B) Non-Food Articles 0.1 -3.3 18.7 21.0

II FuelPower Light &Lubricants -12.5 -10.4 14.0 14.3

III Manufactured Products 0.6 0.1 6.9 6.2

(A) Food Products 11.5 9.7 4.0 4.1

(B) Beverages, Tobacco & Tobacco Products 6.0 5.5 7.6 6.5

(C) Textiles 4.5 2.1 15.2 13.8

(D) Wood &Wood Products 0.3 0.3 14.6 14.6

(E) Paper &Paper Products 2.6 2.0 1.0 1.4

(F) Leather & Leather Products -1.0 -1.2 0.5 0.2

(G) Rubber &Plastic Products 3.4 2.5 6.7 7.0

(H) Chemicals & Chemical Products 2.1 3.2 6.3 4.9

(I) Non-Metallic Mineral Product

s 3.1 5.2 -1.1 -4.8(J) Basic Metals Alloys &Metals Products -14.1 -15.2 12.0 11.9

(K) Machinery & Machine Tools -2.2 -2.2 5.1 4.2

(L) Transport Equipment & Parts 0.6 0.6 2.6 2.3

Source: Reserve BankofIndia

Table-1.6: Monthlytrends in consumer prices (% change)

CPI-IW CPI-UNME CPI-AL CPI-RL

April

08-09

7.8

09-10

8.7

10-11

13.3

08-09

7.0

09-10

8.8

10-11

14.4

08-09

8.9

09-10

9.1

10-11

15.0

08-09

8.6

09-10

9.1

10-11

15.0

May 7.8 8.6 13.9 6.8 9.7 14.1 9.1 10.2 13.7 8.8 10.2 13.7

June 7.7 9.3 13.7 7.3 9.6 14.1 8.8 11.5 13.0 8.8 11.3 13.0

July 8.3 11.9 11.3 7.4 13.0 -- 9.4 12.9 11.0 9.4 12.7 11.2

August 9.0 11.7 8.5 12.9 10.3 12.9 10.3 12.7

September 9.8 11.6 9.5 12.4 11.0 13.2 11.0 13.0

October 10.4 11.5 10.4 12.0 11.1 13.7 11.1 13.5

November 10.4 13.5 10.8 13.9 11.1 15.7 11.1 15.7

December 9.7 15.0 9.8 15.5 11.1 17.2 11.1 17.0

January 10.4 16.2 10.4 16.9 11.4 17.6 11.1 17.4

February 9.6 14.9 9.9 15.8 10.8 16.5 10.8 16.5

March 8.0 14.9 9.3 14.9 9.5 15.8 9.7 15.5

Source: Ministry ofLabor, CMIE


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4 Monetary indicators

The broad money supply expanded by 3.4 percent during the period ofApril to July this year compared

to the growth of 5.3 percent registered during the same period of 2009-10. In absolute terms M3 stood

at Rs 191240 crores as against Rs 253921 crores during the same period of previous fiscal. As on July 30,

2010, the net bank credit flow to Government slowed to 4.3 percent corresponding to the 11.3 percent

growth in 2009-10.

The expansion in money supply is mainly contributed by credit to the commercial sector and increase in

net foreign assets. The net bank credit to the commercial sector was observed to grow at 3.3 percent

during this period compared to modest growth of 0.9 percent in the last fiscal. The net foreign Exchange

assets of banking sector swelled by 4.7 percent vis--vis 0.1 percent growth posted during the same

period of2009-10.

Aggregate deposits in the banking sector increased by 3.3 percent over the period from July to April

2010-11 as against the expansion of 6.2 percent during the same period of previous year. Investments in

government and other approved securities shows moderation in growth to 4.3 percent in 2010-11;

showing a relative decline from the growth of 14.5 percent in the previous financial year. During this

period, total bank credit augmented sharply from 1.1 percent in 2009-10 to 3.5 percent in 2010-11.

The recent hike in key policy rates by RBI on September 16, 2010, made the Indian bankers cautious

about their future move in banking operation. The banking sector is unlikely to respond immediately to

the rate hike by raising their deposit rates and lending rates. Bankers opined that, the persistently low

deposit growth could not support the credit growth. There may also be the possibility of increase indeposit rates followed by lending rates ofbanks.

Table-1.7: Monetary sector indicators up to July(July 2010-11 over March 2009-10)

Variation in M3 (Rs

crore)

Variation in M3 (%)

April

08-09

22235

09-10

124682

10-11

42384

08-09

0.6

09-10

2.6

10-11

0.8

May 73398 172709 92656 1.9 3.6 1.7

June 89283 172702 77314 2.2 3.6 1.4

July 169734 253921 191240 4.2 5.3 3.4

August 208571 280313 5.2 5.9

September 264364 331793 6.6 7.0

October 331450 391310 8.3 8.2November 374193 431266 9.3 9.1

December 423509 521426 10.6 10.9

January 508078 575387 12.7 12.1

February 635810 652944 15.9 13.7

March 740332 806190 18.4 16.9

Source: Reserve BankofIndia


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5... Stockmarket trends

The Indian stock market appears highlypromising for the overseas investors as reflected by the inflows

in the past few weeks with the high flowin investments in the countrys stocks. The growing FII

investments made the BSE index not onlycross 17 K points but to get closer to the 20 K points in

September 2010.

Table-1.8: Monthlytrends in stock market indices (beginning ofmonth figures)

Date BSE Sensex % Change S&P CNX

NIFTY

% Change

1.01.08 20300 4.8 6144 6.6

1.02.08 18242 -10.1 5317 -13.5

3.03.08 16677 -8.5 4953 -6.8

1.04.08 15626 -6.3 4739 -4.3

2.05.08 17600 12.6 5228 10.3

2.06.08 16063 -8.7 4739 -9.3

1.07.08 12961 -19.3 3896 -17.81.08.08 14656 13.1 4413 13.3

1.09.08 14498 -1.1 4447 0.8

1.10.08 13055 -9.9 3950 -11.1

3.11.08 10337 -20.8 3043 -23.0

1.12.08 8839 -14.5 2682 -11.9

26.12.08 9328 5.5 2857 6.5

30.01.09 9424 1.0 2874 0.5

02.03.09 8607 -8.7 2674 -7.0

31.03.09 9708 12.8 3020 12.9

29.04.09 11403 17.5 3473 15.0

01.06.09 14840 30.1 4529 30.4

01.07.09 14645 -1.31 4340 -4.1

03.08.09

01.09.09

15924

15551

8.7

-2.3

4711

4625

8.5

-1.8

01.10.09 17134 10.2 5083 9.903.11.09 15405 -10.1 4564 -10.2

01.12.09 17198 11.6 5122 12.2

04.01.10

01.02.10

02.03.10

01.04.10

03.05.10

01.06.10

01.07.10

17558

16356

16773

17693

17386

16572

17509

2.1

-6.8

2.5

5.5

-1.7

-4.7

5.7

5232

4900

5017

5291

5223

4970

5251

2.1

-6.4

2.4

5.5

-1.3

-4.8

5.7

Source: Reserve Bank ofIndia


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6. Fiscal Management

The total government expenditure amounted to be Rs 332700 crores in July end 2010 calculated over

April 2010; securing almost 25.4 percent increase over the same period of previous year. On the

revenue side, the total receipts increased more than two folds (126.4 % growth in July 2010 over July

2009) from the level ofRs 105378 crores in 2009-10 to Rs 238524 crores during the same period of

current year. The resultant diminution in fiscal deficit is evident from the finance score sheet ofthe

Government as the level of deficit has come down by 42.7 percent during the period in 2010-11.

RBI in the Mid-Quarter Monetary Policy Review of September 2010 assessed the holistic situation of

government finance in detail. According to the review, higher than expected realizations on 3G and

Broadband Wireless Access (BWA) auction accompanied with buoyant tax revenues, have rationally

suspended the fear of the fiscaldeficit exceeding the target of 5.5 per cent announced in Union Budget

2010-11. Thus it would help to stabilize market expectations of liquidity and interest rate movements incoming months.

The overall tax collection grew by 27.5 percent during the month as against the negative growth of11.1

percent in July 2009. The persistent collection in both direct and indirect taxes is primarily responsible

for such an increase in tax revenue. In the segment of direct taxes, corporate tax rose by 18.4 percent

vis-a-vis 4.7 percent growth in July 2009 and the collection in income tax accelerated by 15.8 percent

corresponding to the growth of 5.9 percent in same month of last fiscal.

Looking at indirect taxes we find all major tax components except the Other taxes category confirmed

an impressive growth in July 2010. The customs and excise collection grew by 57.4 percent and 52

percent respectively corresponding to the negative growth observed in same month of last fiscal. The

performance in service tax collection also remained buoyant with a strong growth of 12.5 percent in this

month as against the negative growth of 1.5 percent in July 2009.

Table-1.9: Trends in cumulative tax collections of central government(%)

Gross tax revenue Corporation tax Income tax

08-09 09-10 10-11 08-09 09-10 10-11 08-09 09-10 10-11

April 52.2 -16.9 27.0 55.0 -8.4 23.4 127.7 20.0 8.3

May 36.1 -11.8 22.0 58.1 10.1 -1.8 76.0 11.7 13.0

June 28.4 -11.4 28.6 43.4 1.8 23.7 50.0 7.1 13.8

July 26.2 -11.1 27.5 41.6 4.7 18.4 42.0 5.9 15.8

August 25.0 -11.5 45.9 2.4 35.7 8.1

September 25.3 -7.6 38.2 7.7 30.7 7.2

October 20.3 -7.5 30.3 6.5 21.9 10.5

November 17.5 -7.8 26.4 6.6 19.0 9.8

December 9.6 -2.5 11.9 16.8 6.8 12.2

January 7.2 -1.2 11.9 16.5 5.4 13.3

February 6.9 -1.6 17.9 10.9 7.5 11.4

March 2.7 10.8 7.1


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Customs Excise duties Other taxes

April

08-09

25.0

09-10

-52..6

10-11

106.4

08-09

-28.3

09-10

-114.2

10-11

314.1

08-09

9.04

09-10

-5.4

10-11

-43.2

May 24.1 -38.2 56.6 1.3 -23.3 49.3 26.7 -18.7 -11.7

Jun

e

19.9 -37.3 62.2 -0.9 -23.7 52.0 26.0 -9.5 -36.8July 19.2 -34.7 57.4 4.0 -26.6 52.0 24.7 -3.87 -33.3

August 17.0 -34.0 6.5 -24.5 17.4 -1.97

September 16.8 -32.9 6.6 -22.9 30.7 -20.5

October 14.4 -31.7 6.3 -21.7 16.2 -17.2

November 13.7 -31.2 5.1 -20.0 6.1 -15.0

December 11.1 -29.2 2.1 -18.2 -2.6 -24.2

January 6.4 -25.2 -2.6 -14.5 -6.4 -21.8

February 1.7 -21.8 -7.1 -10.2 -10.0 -19.8

March -4.1 -12.0 -11.5

Table-1.10: Service Tax

Service Tax 08-09 09-10 10-11

April 62.3 -0.04 -6.0May 40.7 -2.60 1.6

June 34.2 -2.85 9.1

July 29.7 -1.46 12.5

August 28.6 -2.29

September 31.8 -3.7

October 31.8 -5.3

November 30.2 -6.2

December 25.4 -5.9

January 24.6 -6.2

February 22.2 -5.9

March 18.6

Source: Controller General ofAccounts

Table-1.11 Trends in central government finances: July 2010

Actual to budgetestimates

( in Rs crores)

Revenue receipts

09-10

105378

10-11

238524

Tax revenue 86309 112821

Non tax revenue 19069 125703

Total receipts 106690 241785

Non plan expenditure 194868 222900

On revenue account 181145 194141

On capital account 13723 28759

Plan expenditure 70376 109800

On revenue account 59011 94458

On capital account 11365 15342Total expenditure 265244 332700

Fiscal deficit 158554 90915

Source: Controller General ofAccounts


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7.Foreign trade

The total merchandise trade (includingthe imports and exports) during the first four months ofthe

2010-11 stood at USD 180 billion as against USD 136 billion. Merchandise exports neared USD 70 billion

in the fourth month of the present fiscal, and imports were seen to rise to the levelofUSD 112 billion.

The high imports have increased the deficits to USD 43 billion from USD 31 billion in the same period of

previous year.

Table-1.12: Monthlytrends in growth ofmerchandize trade (% change) up to July 2010

Exports Oil imports Non-oil imports Total imports

April

08-09

31.5

09-10

-33.2

10-11

36.2

08-09

46.2

09-10

-58.5

10-11

70.5

08-09

32.3

09-10

-24.6

10-11

34.3

08-09

36.6

09-10

-36.6

10-11

43.3

May 12.9 -29.2 35.1 50.8 -60.6 66.7 17.4 -25.4 28.2 27.1 -39.2 38.5

June 23.5 -27.7 30.4 53.4 -50.6 26.5 13.9 -16.5 21.5 25.9 -29.3 23.0

July 31.2 -28.4 13.2 69.3 -55.5 4.4 38.7 -24.5 49.6 48.1 -37.1 34.3

August 26.9 -19.4 76.7 -45.5 39.6 -25.5 51.2 -32.4September 10.4 -13.8 57.1 -33.5 36.2 -30.4 43.3 -31.3

October -12.1 -6.6 22 -9.3 5.5 -17.2 10.6 -15.0

November -9.9 18.2 11.9 7.3 3.4 -5.9 6.1 -2.6

December -1.1 9.3 -30.9 42.8 31.9 22.4 8.8 27.2

January -15.9 11.5 -47.5 56.0 -0.5 28.8 -18.2 35.5

February -21.7 34.8 -47.5 97.4 -10.2 55.6 -23.3 66.4

March -33.3 54.1 -58.1 85.2 -18.9 61.0 -34.0 67.1

Source: Ministry ofCommerce


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8. Foreign investment

The foreign direct investment received up to July 2010 was USD 7.5 billion and was much lower than the

investment ofUSD 10.3 billion received in the previous year.

However, the total FDI which includes the portfolio investments (which is mainly the FII investments)

lifted the total foreign investment for the four-month period (April July ) to USD 21.3 billion almost at

the same level as recorded in the previous year .

Table-1.13: Monthlytrends in foreign investments ($ millions)

Foreign direct

investments

Portfolio investments Total foreign

investments

April

08-09

3749

09-10

2339

10-11

2179

08-09

-880

09-10

2278

10-11

3315

08-09

2869

09-10

4617

10-11

5494

May 3932 2095 2213 -288 5639 41 3644 7734 2254

June 2392 2582 1380 -3010 353 1232 -618 2935 2612July 2247 3476 1785 -492 2077 9114 1775 6508 10899

August 2328 3268 593 926 2921 4194

September 2562 1512 -1403 4999 1159 6511

October 1497 2332 -5243 2922 -3746 5254

November 1083 1722 -574 1274 509 2996

December 1362 1542 30 1533 1392 3075

January 2733 2042 -614 3139 2119 5181

February 1466 1717 -1085 230 381 1947

March 1956 1209 -889 5306 1067 6515



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9.Foreign exchange reserves

In July 2010 forex reserves rose to USD 282 billion from USD 275 billion in the previous month, the

rise in the forex reserves can be attributed to large inflows coming through the portfolio investment

route and partly as a result of revaluation of non-dollar assets.

Indian Rupee against the USD gained by a Rupee over the three-month period .Indian Rupee traded at

Rs 46.5 approx in July and Rs 45.5 in September 2010. Whereas, Euro was seen to get weaker against

the Indian Rupee, trading between RS 56-58 during July and Rs 60-61 in September.

Table-1.14: Monthlytrends in foreign exchange reserves ($ billion)

07-08 % Change 08-09 % Change 09-10 % Change 10-11 % Change

April 204.1 2.5 314.5 1.5 251.7 0.0 279.6 0.2

May 208.3 2.0 312.5 -0.6 262.3 4.2 273.5 -2.2

June 213.4 2.4 312.0 -0.1 265.1 1.0 275.7 0.8

July 229.3 7.4 306.1 -1.8 271.6 2.4 284.2 3.1

August 228.8 -0.2 295.3 -3.5 276.4 1.8

September 247.7 8.2 286.3 -3.0 281.2 1.7

October 262.4 5.9 252.8 -11.7 284.3 1.1

November 273.5 4.2 247.6 -2.0 288.1 1.3

December 275.9 0.8 255.9 3.3 283.4 -1.6

January 288.3 4.4 248.6 -2.8 280.9 -0.9

February 301.2 4.4 249.2 0.2 278.4 -0.9

March 309.7 2.8 251.7 1.0 279.1 0.3



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Automobile Industry

1. Car sales jump in Sept; Maruti, Hyundai cross new milestones

MOST carmakers, including the top twoMaruti Suzuki and Hyundai Motors, reported theirbest monthly sales in September and look poised to set new marks in October even as boomingvehicle sales revive concerns about increasing traffic congestion in cities. We are heading fora blockbuster year on sales. All urban and rural markets are strong and the momentum is likelyto go beyond the festive months of October and November, said Mayank Pareek, managingexecutive officer of Maruti Suzuki India. The countrys largest carmaker reported sales of1,08,006 cars (including exports) in September, beating 1,04,971 sales in August. In thedomestic market, sales increased 33% to 95,148 cars. Hyundai Motors also posted its highestmonthly sales since inception in 1998 at 31,751 cars in the domestic market. Its overall sales,however, declined 4% as exports fell 24.3% to 19,690 units last month, which is partlycontributed to shifting export volumes to local market. We have tweaked supplies to domesticmarket We prefer growth here rather than overseas markets, said Arvind Saxena, director,

marketing & sales, at Hyundai Motor. And the industry is building up inventories to maximisesupplies in the festive season when automakers expect sales to break new records. Tata Motorssold 23,877 cars in September, a jump of 31% while Ford Motors posted sales of 8,380 cars, agrowth of 146% y-o-y. Among the two-wheeler makers, market leader Hero Honda postedsales of 4,33,000 vehicles, a growth of 8%while TVS sold 1,88,005 vehicles in September, up31% y-o-y. Manufacturers are pushing up volumes at the dealerships in a buildup for thefestive season, said Ajay Sethia, auto analyst at financial service company Centrum. Primarysales (factory to dealers) will be high and that will keep the momentum going, although post-festive season could witness lower growth, he added. While car sales in the country have beenrobust for several months now, growing at more than 30% since April and showing no signs ofslowdown, there is a rising concern about traffic congestion in most cities. This is cloggingurban infrastructure and, across the country, state governments are trying to discourage use of

private cars on weekdays, said Abdul Majid, leader, auto practice, at PwC India. Last month,the Centre for Science and Environment had suggested introduction of hefty road tax and acongestion charge as well as high premium on parking to check growth of private vehicles andovercome the traffic mess in Delhi. There are about 65 lakh vehicles registered in the capital,and an average 1,000 new ones hit its roads every day. And the issue is not limited to metrosbut traffic snarls is a reality across cities, from Kochi to Gangtok. In its effort to deal with themenace of vehicles parked on roads, the Sikkim transport department recently made itmandatory for car buyers to produce an availability-of-parking-space certificate before theycan get their vehicles registered. Urban development minister S Jaipal Reddy in June termedIndian middle-class car crazy as he urged states to impose a congestion tax to discouragepeople from buying cars. Car is a status symbol in the country and this state of car mania canbe done away with only in a subliminal way and not by the government, he had said. But allthis is unlikely to impact the sales of cars. One cant stop people from buying cars Carpenetration in India is low and public transport is inadequate, so this growth in car sales willcontinue, said Mr Majid. Even price hikes by manufacturers due to increasing input costs areunlikely to slow demand in the festival season. Tata Motors, which reported a 61% jump insales of the Nano in September to 5,520 units, on Friday said it is raising prices of somemodels to counter higher input costs. But analysts said that rising incomes, positive consumer


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sentiment as well as availability of easy finance and a slew of new and old models to choosefrom, sales will continue to rise.

Economic Times 02.10.10 p.6

2. Automated PowerhouseIF WE think rationally there wont be many people who actually take their SUVs out to bashsome dunes or attempt serious river-crossing expeditions. But still when it comes to buying onethey would invariably end up with a machine which would never be let out in its naturalhabitat. In fact weve always felt that manufacturers should have a variant for their SUVswhich looks exactly like a thunderous beast but when on the road behaves in a much practicalway. The latest 4x2 Ford Endeavour with an automatic transmission is exactly for those peoplewho want a beastly looking machine but might never ever get down to do the actual stuff anSUV is meant for. Launched about a couple of weeks back we got to try it out and compare itagainst its own 4x4 brother at one of the most popular tourist destinations of our country: Goa.So lets take out our colourful beachwear and figure out the car. From the point of view of

looks and interior space, both cars are similar to the T. It had been a long while since we hadtouched the automatic transmission on an Endeavour or any other sub-20 lakh SUV. Used tothe crisp hum of the Audi and the Merc SUVs, the initial feel of this one was surely marred abit by its incessant growling nature. But in a bit we were quite used to its mighty rumbles. Outof these two, first we decided to try out the 4x4 version which instantly took us back to a drivewe had done on the same machine to Jim Corbett. The machine was all prepped up and readyto hit the Goan highway with ease. Maneuvering through its narrow by lanes we were quite atease with its massive size and even while reversing and parking it at tight spots was not aproblem. But being used to different sizes of SUVs there was nothing new for us. So what wedid was place a woman behind its wheels who was neither comfortable with an automatictransmission and nor had ever driven an SUV of this size. Though initially our lab rat was a bitapprehensive but within moments she got so used to the ease of driving this behemoth that we

had to literally wrench it out of her hands! After a bit of the highways and the narrow corridorswe reached the foothills of a mountainous track from where it seemed as if the Endeavour wasback at home ground. From curves to ups and downs it tackles everything with ease. The onlyproblem was in overtaking when the engines growl touched its highest notes but the car itselfwas pulling us at quite a languid pace. And yeah we still hadnt changed the drive mode to4x4! Now at the mountain trail we decided to switch to the 4x2 Endeavour which interestinglyseemed a bit peppier than its big brother. Not only was the engine noise considerably in check,the car also felt a bit lighter. While descending back to sea level the clouds caught up with usand we used the slippery situation to literally drift this behemoth out of curves butunfortunately due to speed restrictions and low visibility were unable to feel the real power ofthis engine.



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3. Now, Nano direct from showroom

CUSTOMERS can finally buy Tata Nano directly from showrooms in select states as TataMotors moves to end booking system for the worlds cheapest car.Tata Motors started open sales of the Rs 1-lakh car in Maharashtra, West Bengal , Uttar

Pradesh and Karnataka on Tuesday, making it possible for people to purchase the car directly

from dealers instead of booking it. Customers in these states that have not booked a Nano sofar can now purchase the Nano directly from showrooms, the company said in a statement.When it launched the Nano commercially in March 2009, Tata Motors decided to sell the carthrough a booking mode due to expected huge demand and limited production capacity atPantnagar in Himachal Pradesh. Tata Motors was forced to move the Nano mother plant toSanand in Gujarat from Singur in West Bengal following agitations over a land row. TheSanand plant started commercial production in June, helping the company speed up deliveryand meet most of the initial bookings done last year. The countrys largest automaker hadstarted open sales of the Nano in Kerala in August when the state celebrated the Onam festival.

Tata Motors has tied up with 25 banks including the State Bank of India, HDFC Bank, ICICIBank and Canara Bank to offer loans for purchasing the Nano, the company said in thestatement. Customers will be able to take a closer look at and test drives the Tata Nano acrossall Tata Motors dealerships and special Nano access points, it said. Last year, Tata Motors hadselected 1.55 lakh customers for delivering the car in two phases. It is in the process ofdelivering the car to the first one lakh customers, which will be completed by the end of thisyear. The company has been ramping up production at Sanand and intends to reach 20,000units per month by December. The plant has the capacity to produce 2.5 lakh units which canbe ramped up to 3.5 lakh units.


4. BMW launches auto finance arm in India

WORLDS largest luxury carmaker BMW Group has entered into auto finance business inIndia through its global finance arm, BMW Financial Services, to support its customers anddealers to boost sales volume in the country. The finance entity, which is a wholly-ownedsubsidiary of the BMW Group, has received the licence to operate as a non-banking financecompany (NBFC) from the Reserve Bank of India. BMW Financial Services will be based inGurgaon and has been set up with an initial investment of $50 million.

BMW is locked in a pitched battle with Mercedes for the top slot of luxury car sales in India.Daimler AG, which makes and sells Mercedes cars, has also said it will begin operations of itsfinance arm Daimler Financial Services in India by 2011. BMW Financial Services will helpfinance customers looking to buy BMW cars as well as those of few other brands. We wouldprovide tailor-made financial services through our dealers and also cater to other brands from

Maruti to Honda, where our dealers have a commercial interest, Sanjiv Shah, the newly-appointed MD & CEO of BMW Financial Services said. BMW Financial Services, whichoperates in 31 countries besides India and has a 3 million global customer base will have threebusiness verticals in India retail, finance, commercial finance (for the BMW dealerships)and auto insurance solutions.



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5. Top gear car sales drive up forecast

THE Indian auto industry sharply increased its sales forecast for this fiscal year afterreporting more than 30% rise in car sales for the third straight month as launches and easyfinance helped keep strong demand intact in September.

With more people expected to buy cars and two-wheelers in the festival season, the Societyof Indian Automobile Manufacturers (SIAM) on Friday increased its growth forecast for 2010-11 to 18-20% from its previous forecast of 13%. There is a strong growth momentum and wesee the trend continuing, said Pawan Goenka, president of SIAM.Car sales increased 30% in September to 169,082 units with most carmakers including Maruti

Suzuki and Hyundai Motors reporting their best monthly sales.Analysts expect the momentum to continue although there is increasing concern about the

pace of road building in the country and increasing traffic congestion in cities. Manufacturerswill push volumes to the dealerships as a build-up to the festival season and this will keep themomentum going, said Mahantesh Sabarad, auto analyst at Mumbai-based brokerage FortuneFinancial. SIAM expects passenger car sales to grow 21% this financial year to 2.4 millionunits from 1.95 million. Two-wheeler manufacturers are expected to sell 11 million while

trucks and three-wheelers may record 6 lakh and 5 lakh sales, respectively.


Banking/ Credit Services

6. SBI, PNB raise deposit rates for second time in 2 months

INDIAS two largest banks, the State Bank of India (SBI) and Punjab National Bank (PNB),have raised deposit rates for the second time in the past two months. The second round of hikein rates is in response to the increase in policy rates a fortnight ago by the Reserve Bank India

(RBI). Both banks have decided not to raise their benchmark rate for loans and floatingdeposits the base rate, which stays at 7.5% and 8%, respectively. IDBI and Axis Bank have,however, decided to raise their base rates. IDBI has hiked its base rate by 50 basis points to8.5% while Axis Bank has raised its base rate to 7.75%. The base rate, which replaces theprime lending rates, has come into effect from July 1, 2010. Most banks are set to review theirbase rate in the first week of October since RBI has said banks should review it once a quarter.SBI will offer 7.75% for its special 1,000-day scheme which was introduced mid-Augustagainst 7.72% earlier. On its other special deposits scheme 555 days scheme the bankhas raised rates by 50 bps to 7.50%. SBIs move to raise rates comes at a time when its share indeposit market has dipped from 24.1% in March 2009 to 22.5% in March 2010. This is thesecond rate hike by SBI and PNB this calendar year while RBI has raised repo rates (the rate atwhich RBI lends to banks) four times from 4.75% to 6%. The hike in rates has been steepest inthe 91 to 180-day slab from 4.75% to 5.50%. If SBI deposits rates that were offered twomonths ago are compared, rates have risen by 150 basis points from 6% for deposits up to twoyears to 7.75%, which is now being offered in special 1,000 day scheme.

Following the hike in deposit rates, SBI floating rate deposits scheme where interest ratesare linked to base rate may lose some shine. SBI floating rate deposit scheme was launchedmid-August and it offered slightly higher rate than fixed deposit rates. Following SBIs


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decision not to revise the base rate, floating rate on these scheme remains unchanged and nowboth rates would be at par. For instance, in floating scheme, SBI pays 7% for one year (baserate minus 50 bps) and under fixed rate, it pays 7% for one year to 554 days against 6.75%earlier. Meanwhile, PNB has raised rates by 25 bps on slab starting form 91 to 179 days byoffering 5.5% for 179 days and 8% for 10 years. For 1-2-year slab, banks are paying 7.25%against 7%. IDBI has also raised deposit rates by 25 to 50 bps across all maturities.


7. RBI holds the key to banking licence vault

THE LAST time a new bank was set up in India was eight years ago. Much has happened inthe Indian economy since then. So when the Reserve Bank of Indias deputy governor UshaThorat meets bankers and industry representatives this week to discuss the issue of new banklicenses, interests will be high, to say the least. This will be the first meeting between RBIand industry since the apex bank came out with the draft guidelines on new banking licences inAugust this year. In a discussion paper titled Entry of new banks in the private sector RBI

acknowledged the necessity of large capital investment, but also put on record its reservationsagainst the entry of promoter-driven corporate houses. It indicated that there is a case for aminimal capital requirement in excess of 300 crore, but added that corporate houses withdiversified shareholding should be preferred. Big corporate groups such as Reliance Capital (ofADAG Group), the Tatas, Aditya Birla group and Larsen & Toubro have already evincedinterest in the sector, in addition to large non-banking finance companies such as LIC Housing,Shriram Finance, Mahindra Finance, IFCI among others. The stakes are high. In a country of abillion-plus population and growing at 8% (of GDP), six out of every ten people still does nothave access to banking services. According to a PricewaterhouseCoopers study only 5% of the600,000 village habitations in the country have a commercial bank branch and 51.4% of thenearly 89.3 million farm households do not have access to any credit either from institutionalor non-institutional sources. Needless to say, RBIs licensing policy will be aimed to facilitate

financial inclusion and companies that have substantial exposure to rural areas, namely viafarm equipment financing, are likely to be at an obvious advantage. Also, with CASA (currentaccount savings account) deposits being the cheapest sources of funds for banks, the newbanking licences represent a tremendous opportunity to access cheap funds, says SudipBandyopadhyay, managing director and chief executive officer of Convexity Solutions, whohas headed Reliance Money in the past. But foraying the rural markets is fraught withchallenges. It will be important for new players to design and develop relevant products forthese markets that are currently out of the ambit of banks and NBFCs. The cost of delivery ofservices too will play a big part. Of course, reducing transactional costs through appropriatetechnologies will be among the challenges in store for us, says Ramesh Iyer, managingdirector of Mahindra Financial Services. Companies looking to enter the banking space couldbroadly be classified into three categories, says Ashvin Parekh, partner national leader, global

financial services at Ernst & Young. Category A companies are the ones that meet the criteriabroadly and can start preparing for the licence. Category B companies, which fall short oncertain parameters, namely capital or experience, are likely to look for foreign partners to plugthose loopholes. Category C will be those companies that have set themselves a vision in beingpart of the sector but fall short of the proposed criteria. The latter are likely to explore takingover an RRB. In his budget speech, the finance minister had said that the government and RBI


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would collaborate to provide banking facilities to habitations which have a population inexcess of 2,000 (as per 2001 census) by March 2012. If that deadline has to be met, thestakeholders will need to act swiftly.


7. IndusInd clocks 71% rise in second quarter net profit

INDUSIND Bank has reported a net profit of . 133 crore for the quarter ended September 2010 a 71% increase in net profit over . 77.8 crore in the corresponding quarter last year. Theincrease was largely due to a 57% rise in net interest income to . 330 crore from . 209 crore inthe corresponding quarter last year.The bank ended the quarter with a 16% capital adequacy ratio (CAR) after following a .

1,172.75cr qualified institutional placement on September 24. The bank issued five-croreshares at a price of . 234.55 per share. The QIP issue resulted in the promoters stake decliningfrom 22% to 20%.The net interest margin of the current quarter was 3.41% against 2.86% in the corresponding

quarter of the previous year. We expect our margins to improve further as we go ahead. Ourbook is balanced in such a manner that it is interest rate agnostic, said IndusInd Bank MD &CEO Romesh Sobti.He said a large chunk of the banks loans, accounting for nearly 42% of all lending, comes

from consumer finance business. As on September 30, 2010, total advances were at . 23,452crore and total deposits were at . 31,290 crore, showing a YoY growth of 33% and 37%,respectively. The CASA (Current Accounts-Savings Accounts) ratio improved to 25.44%against 21.22%.Mr Sobti said while the central bank was expected to raise rates further, IndusInd did not

expect a rise in its blended cost of deposits


Biotechnology

8. GEN EGGXOTIC

When Professor Robert Edwards was awarded the Nobel Prize in Medicine for his pioneeringwork in developing in vitro fertilisation (IVF), Indias first test tube baby Kanupriya Didwania(nee Agarwal) was celebrating her 32nd birthday.Didwania came into the world nine and half weeks after Prof Edwards made possible the

worlds first test-tube baby, Louise Brown (July 25, 1978). Late Dr Subhash Mukhopadhyayperformed the same feat in Kolkata with Kanupriya Durga (a possible theme for this seasons

Pujo pandals!). But while Dr Edwards achievements got him the accolade in his lifetimealbeit after 32 years and over 4 million test tube babies across the globeDr Mukhopadhyaywasnt lucky enough. Derided and ridiculed, he took his life. But his pioneering work ensuredDidwania would be in good company of thousands of others like her, as the acceptance as wellas the need for IVF grew over the years. It is a pleasant coincidence that Didwania, an MBA, is


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now brand manager for Perfetti India, selling confectionery and gum to childrenmany ofthem born in the tube.Bourn Hall, the first IVF clinic co-founded by the Nobel laureate, says the IVF business in

India is already 300-crore strong, and growing at a rate of 15% year-on-year. Some otherindustry experts, however, say this is a conservative estimatethe business is already 1,000-crores and more. There are more than twenty reputed IVF clinics in New Delhi alone. And

each of these clinics is performing 200 to 300 cycles (attempts) a year. So you can easily putthe number of annual cycles in the country at about 10,000. It is phenomenal, says DrKuldeep Jain, president-elect of the Indian Fertility Society. Jain, who studied IVF inSingapore and has published over 35 papers in national and international journals, adds that thegiven number of cycles at the prevalent rates of an IVF treatment should put the Indian IVFindustry in the vicinity of 1,000 crore.He is, however, quick to add that one must not see such medical procedures in business

terms.


Drugs/ Pharmaceuticals9. Japans Taisho leads race for Paras Pharma

JAPANS Taisho Pharmaceuticals has emerged as the front-runner to buy a majority stake inParas Pharmaceuticals by offering over six times the annual sales of the Indian drugmaker, anindustry executive familiar with the development said. Though discussions with Taisho havenot gone to the extent of signing a so-called term sheet agreement, it is now the most likelybuyer, unless a competitor outbids it, an executive from a PE firm said, asking not to be named.A term sheet is an agreement which describes the broad structure of a proposed deal, but maynot be legally binding. PE investors Actis Advisors and Sequoia Capital India Advisors, which

jointly own 70% in privately-held Paras Pharma, have put their stakes on the block. MorganStanley is looking for a buyer. Promoter Girish Patel and his family hold the remaining 30%stake.

We are interested in entering the Indian market. But it is not true that we have offered tobuy the PEs stake, the Taisho Pharmaceuticals spokesman said. He refused to comment anyfurther when asked if Morgan Stanley has approached it to buy the stake of the PE firms or ifTaisho is in discussions to buy a stake in Paras. Taisho is among Japans top 10 drug makers,but has no presence in India. It employs over 5,500 globally and had revenues of $3.1 billionfor the year ended March 2010.


10. Torrent Pharmas ED Sanjay Dalal quitsSANJAY Dalal, the executive director and chief operating officer of the 1,500-crore TorrentPharmaceutical, has stepped down. He put in his papers last week. This is the second majorchange in the top management within a span of five months after Ruchir Modi, marketing &sales head and nephew of the promoters the Mehta brothers was shifted to Torrent Power


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from the pharma business. Torrent Power is a 6,000-crore company engaged in powergeneration and distribution in three major cities of Gujarat. Sanjay Dalal, a 10-year veteranwith the organisation, quit to take up a new challenge and job profile, industry sources said. Inhis mid-50s, he was considered second-in-command after Samir Mehta, managing director andwhole-time director of Torrent Pharma. Mr Dalal joined Torrent Pharma in September 2000after a seven-year stint with Arvind Mills as vice-president-finance. In between, he also

worked as vice-president-finance in Reliance Industries for a short period of six months (fromApril 2000 to September 2000). A chartered accountant by profession, Mr Dalal did his B.Comfrom HL College of Commerce. He also holds a law degree. His expertise lies in corporatefinance, treasury & risk management, accounting, audit & control, tax, commercial and generalmanagement.

Talking to ET, Mr Dalal confirmed that he quit Torrent Pharma but declined to give anyspecific reason. When asked about his next assignment, he said he was undecided yet.

In response to an email query, Torrent Power said Ruchir Modis move from Torrent Pharmawas a business need. Mr Modi, who did his engineering in chemical, mining and environmentfrom University of Nottingham, joined Torrent Pharma in January 2002 as head of marketingand sales and worked with the organisation for more than eight years. He was instrumental inincreasing drug sales and market share of Torrent Pharma. Torrent Pharmas share price has

moved sharply in the last several months. From a 52-week low of 285 in October 2009, itpeaked to 606 this month. On Wednesday, the share closed at 580.50.


11. India, EU settle generic drug dispute

India has said it has resolved its dispute with the European Union (EU) over confiscation ofIndian generic drugs by European countries such as the Netherlands and France, endinguncertainty among Indian pharmaceutical producers who use Europe as transit point forexporting to Africa and Latin America, report Our Bureau & Agencies from New Delhi &Berlin.


12. Drug seizure issue settled, EU agrees to amend laws

INDIA has resolved the dispute with the European Union over confiscation of Indian genericdrugs by countries such as the Netherlands and France, ending uncertainty for Indian pharmafirms which use Europe as a transit point for exports to Africa and Latin America.

The EU has accepted our position and amended its rules, commerce and industry ministerAnand Sharma told reporters on the sidelines of the Ficci-Frauenhofer CEOs Roundtable in

Berlin on Thursday. He said India would withdraw the complaint filed at the World TradeOrganisation (WTO) against such seizures. We do not want to be in conflict. There has beenrealisation and we appreciate the steps, which have been taken. They went to the extent ofsaying that they were misreading the concerned EU notification, the minister said.In the last couple of years, Customs authorities in a number of European countries seized

about 17 drug consignments shipped from India en route to various African and LatinAmerican countries. The medicines, which were generics or off-patent in India, were


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impounded as European companies holding patents for them in their countries had complainedto the authorities that they were counterfeit.India claimed that such seizures flouted multilateral trade rules as the medicines were off-

patent both in India and the country where they were being exported. Almost half of Indiasdrugs exports worth 40,000 crore are generics.The Indian industry welcomed the EU decision to amend its customs rules, but said there is

need to be cautious. This is good news, but it could be a strategy by the EU as its intellectualproperty interests are now covered by the anti-counterfeit trade agreement (ACTA) that it isabout to implement with 10 other countries, DG Shah, secretary general at IndianPharmaceutical Alliance (IPA) said.The ACTA being negotiated among 11 countries the EU, the US, Canada, Mexico,

Switzerland, New Zealand, Morocco, Japan, Australia, Korea and Singapore proposes towiden the scope of protection and setting up higher standards for enforcement of intellectualproperty rights. It would extend to import, export and in-transit goods and includesinfringement of all IPRs. The proposed legislation provides for seizures, confiscation anddestruction of devices.Prathiba Singh, a Delhi-based lawyer who represents Indian drug makers in patent cases

against global drug makers, said the government should negotiate to preclude similar actions to

seize Indian drugs through any other laws or treaties such as the ACTA before withdrawing itscomplaint to the WTO. Ficci president Rajan Bharti Mittal said: We are happy that thisdispute has now been resolved, not only because a significant part of our over $5-billionpharma exports was at stake, but there was serious concern about a large number ofdisadvantaged and poor people being deprived of access to affordable generic medicine.In its joint complaint filed against EUs Customs regulations at the WTO, India pointed out

that GATT (the WTOs former avatar) had specific rules on goods in transit which did notallow such confiscation.


13. Diabetes drugs post fastest sales growthSALES growth of diabetes medicines has accelerated the fastest among all drugs sold in the

country as pharma companies pushed their products to tap over 50 million people sufferingfrom the lifestyle disease in India, making it the single largest home for diabetics in the world.

Oral anti-diabetes segment grew 29.7% for the nine-month period ended August 2010 overthe year ago period compared with 22.9% increase in the same period last year. The growth ofinsulins accelerated about five times to 28%, as per research firm IMS Health Information andConsulting Services India.This was much higher than the 20% growth in the overall Rs 43,000 crore local drug retail

markets in the same period that made it one of the fastest growing drug markets in the world.An analysis of the product trend in the insulins market showed that a major component of

the growth has resulted from volume increase of existing leading brands. New launches in2009 have also contributed to this growth, Sameer Savkur, MD at IMS India said.

The total anti-diabetes drug market is estimated to be around Rs 2,600 crore, 70% comprisingoral medication.Sales of some of the top selling anti-diabetes brands grew much faster than the industry.

Sanofi Aventis Lantus ranked 50th among all medicine brands in the highly fragmented localmarket, grew 57.9%, the highest among the top 50 brands, as per IMS data. Sales of rival


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MSDs Januvia, ranked 110th among all medicines sold in the country, rose a whopping111.4%. Abbotts insulin brand Human Mixtard, the fifth largest medicine brand in the countrygrew 30.9%.In comparison, the countrys top two selling drug brands, Pfizers Corex and Abbotts

Phensedyl, both cough syrups, grew 23.5% and 11.3%, respectively, during the nine-monthperiod ended August 2010. Last year also, oral diabetes segment had posted the highest growth

across all key segments, marginally ahead of antibiotics segment. But overall growth fordiabetes drugs was modest as sales of insulins grew just 5.3%.Sanjiv Navangul, business unit director (chronic care, critical care & disease management) at

MSD India said: More diabetic patients are coming for therapy and compliance to medicationhas increased due to new marketing strategy and awareness. Companies have also penetratedmarkets in small towns and rural areas, he said.Muralidharan Nair, partner (life sciences) at consultancy firm Ernst & Young estimates about

half of the countrys diabetes population is yet to be diagnosed. With global firms such asAbbott, Pfizer, Sanofi Aventis and MSD pushing their drugs to the hitherto neglected smallertowns to tap newer markets, the potential in the segment is immense. Companies are trying totap the undetected segment of diabetic population, Mr Nair said.Around 4% of the Indian population is suffering from the disease, making it the diabetes

capital of the world. The spurt in sales from medicines to treat diseases such as diabetes,cardiovascular, and anti-psychotics is increasing the revenues from the segment also known aschronic segment. The market share of drugs for treatment of chronic diseases has graduallyincreased, accounting for 27% now, from about 20% a few years ago. In developed markets,chronic segment accounts for two-thirds of the total market reflecting the predominance oflifestyle diseases with economic prosperity.


14. Nirma strategy fails to turn pharma subsidiary around

ITS LOW-PRICE strategy made it a favourite case study across B-Schools. However,Nirmas attempt to replicate the detergent price war in the pharma segment has not yieldedsimilar results. The Ahmedabad-based FMCG major, which has decided to delist from theBSE and NSE for operational freedom, acquired the ailing business of Core Healthcare in2006, reportedly for 300 crore, to enter the pharma sector. Core, an Ahmedabadbasedmanufacturer of IV fluids (parenteral), was declared sick. Even after four years, Nirma is yet tobring about a turnaround of the loss-making entity it had renamed Nirlife. The companyincurred a loss of 49.21 crore for 2009-10, 43% lower than a loss of 86.75 crore incurred in theprevious year. ccording to a pharma analyst who tracks Gujarat companies, Nirma tried to cutprices in IV fluids (parenteral) drug segment, a strategy it adopted to challenge multinationalslike HLL and P&G in the detergents space. However, the strategy did not work in a drugsegment that often deals with critical care treatment where quality and not price is a premium.

According to a former Nirma executive, the lowprice strategy was bound to fail as there aremany small companies who can cut prices to match those of the branded products. Also, BigPharma with its strong marketing network has an upper hand in pricing. Apart from pharma,the billion-dollar company by revenues and the seventh largest soda-ash maker in the world,diversified into real estate, cement and packaging.


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There was a lot of expectation from Nirma when it took over Core Parenterals. But we didnot see an aggressive push, says the marketing head of an Ahmedabad-based pharmacompany.The net loss stood at 173.12 crore in the first year after the Core Healthcare acquisition. The

following year, it saw a minuscule net profit of 6.71 crore, but in 2008-09, the company againincurred a loss of 86.75 crore. The trend is yet be reversed.

Nirma does not respond to media queries, but its FY09-10 annual report mentioned that itspharma business continued to be impacted by rising raw material prices and stiff competition.The report highlighted increase in gross sales to 230 crore up from 160 crore in the previousyear.

In 2007-08, Nirma undertook installing a formation facility to manufacture a complete rangeof pharma formulation in injectibles, syrups, ointments etc. The company saw a rise in its totalrevenue in 2007-08 to 127.16 crore from 53.79 crore in 2006-07. Similarly, the revenues rosefrom 156.36 crore in 2008-09 to 225.10 crore in 2009-10. However, despite rising revenues,losses continued.Core Healthcare was incorporated as public limited company in 1986 in the name of Core

Parenterals by Sushil Handa and Sunil Handa, as a multiproduct healthcare company producingIV fluids, medical disposables, injectables, orals and formulations. The name of the company

was changed to Core Healthcare in 1994.


15. GSK to raise elephantiasis drug output at Nasik unit

BRITISH drugmaker Glaxo-SmithKline (GSK) will increase its capacity to make a medicinefor treatment of elephantiasis at its manufacturing facility in Nasik (India) besides its SouthAfrican plant, a top company executive said.GSK makes albendazole, a medicine used by 120 million people across the world, at its

production units in Nasik and Cape Town. The two units together have the capacity to make

600 million units of the drug, all of which is donated by the company to global healthorganisations. The firm now intends to increase the capacity to make albendazole to 1 billionunits.Shipments of the new donations are expected to start in late 2011, Andrew Witty, CEO atGSK said. The cost of making these drugs will cost GSK about 12 million ( 85 crore) a year.

The companys plant in Nasik to make 300 units of the medicine annually was inaugurated inMarch this year. This plant is operated by GSKs public listed Indian subsidiary GSKPharmaceuticals. The additional global capacity to make the medicine will support the WorldHealth Organisation (WHO) project to eliminate the elephantiasis-causing infection lymphaticfilariasis through universal coverage.Lymphatic filariasis, often called elephantiasis, is a parasitic infection that causes

disfigurement and painful swelling of limbs, breasts and genitals. It places at risk the lives of

about 1.3 billion people in worlds poor countries.Economic Times 15.10.10 p.5


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Education and Training

16. Seniors join ISB for modern lessons

FOR a clutch of senior professionals with an average 18 years of work experience lifehas come full circle. They are back to school, not as teachers, but as students. Sixty-sixexecutives from various sectors have joined ISBs (Indian School of Business, Hyderabad) newprogramme PGPMax, a part-time course designed for senior executives. For the next 15months, the first batch of students at PGPMax will trade their current roles in their respectivecompanies to debate over current issues with classmates, spend hours pouring on studymaterial and burn the midnight oil to wrap up last-minute assignments. The idea is to growbeyond their functional areas, and look at larger aspects of modern management.

Paramita Sarkar is a case in point. With 19 years of experience in sales, marketing andproduct development laboratories, Paramita, general manager, Care Chemicals at BASF India,says that though a professional learns a lot on the job, certain important areas are left outbecause it doesnt fall in his or her vertical. I want to equip myself on issues pertaining to

M&As as my company has investment plans in China and in the Asia Pacific region, saysSarkar, who has a BTech in chemical engineering from Jadavpur University in Kolkata.For Imal Fonseka, a Sri Lankan national, it is the need to know how managers in India

strategies and work on big brands. We are facing competition from India and other nations inthe Asia Pacific, says Fonseka, managing director of Hemas Consumer Brands of Sri Lanka.Gaining local knowledge and meeting those in competition is what I am looking for, addsFonseka, who comes with 20 years of experience in the FMCG business.The premier B-school decided to start this programme as it found that several business leaders

were looking for a leadership course for senior executives. We discovered that several CAs,engineers and other professionals were a few levels below the business head, and wanted tomove on to the next level of leadership, says Deepak Chandra, deputy dean. We decided tostart this programme to fill the gap, adds Chandra. Peer-to-peer learning is the key unique

selling proposition of this programme.


17. IIMC students get into the mind of investors

IIM Calcutta students are now studying psychological concepts to better understand investorbehavior and the financial implications of such behavior. In a novel course introduced this yearcalled Behavioral Finance taught by Prof Avanidhar Subrahmanyam, the Goldyne andIrwin Hearsh Chair in Finance from UCLA Anderson School of Management the students,by means of interactive dialogue, learn about different aspects of investor behaviour, the

rationale, or lack thereof, behind such behaviour and ways to forecast them.Classical finance assumes all investors to be rational and thus, fails to explain events like

market crashes, unprecedented booms or volatility. Behavioural finance, on the other hand,proposes psychology-based theories to explain anomalies in the market.


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The course gives the students an insight into the world of irrational investors, and throughinteractive dialogue, helps students assess what investors would do in various situations, ashumans and not as calculators.

Nitin Pahwa, a student who took the course, said: The course material comprised a set ofrecent research papers in the field and the discussions in the class were of immense value.


18. IIMA out to reform placement system

IN 2010, IIM Calcutta reported 1.6 crore as the highest international annual salary offered toone of its students.

At IIM Ahmedabad, the average domestic salary this year was 14.94 lakh as against 12.17lakh in 2009, but well below the 2008 levels of 17.85 lakh. The average salary at IIM-Kozhikode stood at 14 lakh.The astronomical salaries paid to management passouts is a much-discussed topic and B-

schools too, in their rush to establish supremacy, sometimes tweak salary components to arriveat higher figures.

Hence a need was being felt to bring in more uniformity and transparency in placementstandards. Towards this end, the IIMA has put forth a new system, Indian PlacementReporting Standards, which aims at achieving goals similar to those envisaged in theInternational Financial Reporting Standards (IFRS).

IIMs, private B schools and blue-chip recruiters debated the concept at a recent recruitersconclave in Mumbai. The proposed system would calculate salary figures as per a commonformula and placement results would be announced in a pre-decided format.

The pan-India standards presented in the conclave also aimed at a fair comparison betweenB-schools on parameters like salary figures and number of grads picked up by top recruiters.The norms aim to bring in more clarity on say, what actually constitutes a croreplus salarypackage. According to IIMA director Samir Barua, the norms will include salary structure,amount of CTC (cost to company), bonuses, relocation expenses, other cash expenses and eventhe noncash part of the salary offered to the students.The conference was attended by over 50 recruiters, including GE, McKinsey & Co, HUL,

P&G, Wipro, Standard Chartered, Bank of India, and Monitor Group.While IIM-Bangalore was conspicuous by its absence, other IIMs, including IIM-Calcutta,

Indore, Lucknow and Shillong participated along with private B-schools like ISB, SP JainInstitute of Management and Research and Institute of Management Technology, Ghaziabad.

In fact, IIMA has introduced its new cohort-based system for both summers as well as finalplacements from this year itself. The new system, which has replaced the traditional Day Zeroprocess, aims to accommodate the increased number of students and facilitate smoothplacement for them IIMAs student strength has gone up from 220 in 2003 to 431 in 2010.According to it, recruiters are grouped together as per sectors, and not as per salaries offered.

The process typically goes on during weekends without disrupting classes and allows recruitersmore time with a student during interviews.IIMA placement chairperson Saral Mukherjee, who designed the cohort-based system, said

there were inaccuracies in the way salary packages were reported. We hit upon an idea totackle this problem. Through these standards we are looking at figures that are more robust andreliable, Mukherjee said, referring to the blatant misuse of students salary figures by some B-schools in promoting their brand.


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The format has found favour among most recruiters, and the premier B School hopes to tell itssuccess story to other institutes through recruiters experiences.We prefer the cohort system at IIMA. It was clear that we needed time to discuss with the

candidate and evaluate the strengths before hiring any graduate. The Day system did not giveenough time and students ended up hurriedly selecting jobs, said Vasudev Murthy S, generalmanager-consulting operations, Wipro.

There was a need for a new system that can give much more time to students and recruiters.We believe that all the top IIMs like Ahmedabad, Bangalore, Calcutta and Lucknow shoulddiscuss and find out a common placement system which is similar to the cohort. Apart fromreporting standardisation, there is a need for process standardisation, said a top official of aleading global investment bank on condition of anonymity.


19. Spice sprinkles its corporate flavour in Indian academia in2010

The Spice Group has always looked for tools to explore and exploit opportunities. Amazingly,this time, it is education that the group is taking a plunge into. The group plans to set up aglobal university at Modipur in Rampur district of Uttar Pradesh by 2012. It will be built on thesite of the now defunct Modi Xerox factory and will be a part of the S Foundation. SpiceGroup, currently, has four major sector-based verticals, namely, telecom through a newholding company - Spice Televentures; entertainment; financial and capital market services;and IT and related technology verticals.Group chairman B.K. Modi said: "The objective of the university is to help propagate

"holistic education". The total cost of the project is estimated to be Rs 1,000 crore, of whichRs.100 crore will initially be pumped in to kick start, the project. The university, we expect,will be complete by 2012.

The rest of the money will be built as wealth generated from the project itself as internal

accruals. This is the same model that is employed by any Indian family run business to begin auniversity such as the Amity University headquartered in NOIDA and the Lingayat Universityheadquartered in Bangalore. Although the Lingayat University is headed by a trust and not asingle family, yet it is run on the same lines.

The group feels that there is a huge market and business opportunity in India in the educationsector. "In a country whose 50 per cent population is below the age of 25, it makes goodbusiness sense to foray into the education sector. We feel there is more scope in this marketsegment," said Prakash Nanani, group president at Spice Corp., who is in charge of the project.

While talking about providing reservation to the children of local people in the university,Modi said: "We already have a school operating here from which brilliant results are showingup. I don't think there's a need to provide reservations to them. However, financial assistance inthe form of scholarships will be provided to the deserving candidates." The Group is also

planning to set up a Business Process Outsourcing (BPO) unit in Rampur, which will start itsoperations in the next three months.

In case local students do well in the university then the university and the BPO managementmay consider absorbing these good students in their respective projects.

Besides, the latest with the group is its new technology products. In line with its vision toprovide cutting edge, technology products and services that enable new age mobility


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consumers to stay one step ahead of their dreams, Spice Mobility recently announced a newrange of devices termed "Connected Spice Life" operating on the open source Androidplatform, and powered by chipsets from Qualcomm Incorporated, the world leader in 3G andnext generation mobile technologies.Three distinctive Connected Spice Life devices have already been unveiled by the company,

which follow closely on the heels of a global launch in ASEAN countries.


20. That touch with industry

The Indian School of Business (ISB) recently hosted 'India Fast Growth 25' in partnershipwith the AllWorld Network and The Indus Entrepreneurs (TiE), Hyderabad. 'India Fast Growth25', is an annual rating of emerging private companies in India and offers a snapshot of howIndia is creating new economic values and the constraints faced by entrepreneurs. Throughthis, the AllWorld aims to recognise and advance all the growth entrepreneurs of the emergingworld by 2015, creating a global entrepreneurship industry and next one million jobs.The 25 winning companies were felicitated at the ISB and were also part of a panel discussion

on entrepreneurship. The discussion began with a welcome address by Krishna Tanuku,executive director, Wadhwani Centre for Entrepreneurship Development, ISB.A panel discussion followed with Tanuku; Ramu Kallepalli, CEO, TravelSpice.com;

Phanindra Sama, CEO, redBus.in; Sameer Mehra, CEO, Suminter India Organics and VipinAggarwal, vice president, Nexus Capital as the panellists. The discussion was moderated bySudhir Syal, editorial head, Starting Up, ET Now. The panel discussed issues likestart upventures, importance of retaining talent, funding for fast growth, raising capital and marketexpansion.

This was followed by a keynote address by Srini Raju, founder and chairman, Peepul Capital.Discussing the importance of raising capital, Raju said that it is very important forentrepreneurs to project a realistic picture of the company as they approached and signed deals

with investors, particularly private equity players.Habiby, co-founder and director, AllWorld, introduced the organisation and spoke about howIndia Fast Growth 25 was started. She said that the 25 companies created about 7,000 jobssince their establishment and these firms are expected to grow by 50 percent or more in thenext six months.Discussing entrepreneurship at the ISB, Tanuku said, "At the ISB we encourage students to

seek entrepreneurship as their career choice. The ISB is trying to facilitate a more in-depthunderstanding of the students to understand the power of entrepreneurship, what it takes to be asuccessful entrepreneur and eventually becoming a successful enterprise."The other partners that supported India Fast Growth 25 are Entrepreneur Magazine, ET Now,

PHD Chamber, TiE Network, Nexus Ventures and Mumbai Angel Network.



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Electronics/ Telecommunication

21. DoT turns down RIM solutions

THE BlackBerry security jinx is unlikely to be resolved in a hurry. The telecom department

has rejected the interception solution offered by Canadas Research In Motion (RIM) for itssecure corporate email service. Whats more, it has spurned RIMs technical solution fordecoding all chat communication on the popular BlackBerry Messenger service, whichcontradicts the home ministrys recent clean chit to the Canadian smartphone makersinterception solution for its messaging service. In an internal note, dated September 28,reviewed by ET, the telecom departments security wing claims security agencies have beenunable to intercept or monitor secure email communication made through the BlackBerryEnterprise Services (BES) in readable format. RIM maintains that it does not have theencryption keys that can be offered to security agencies for converting secure corporate emailinto readable format, said a senior DoT official with direct knowledge of the matter.

The telecom departments internal note claims law enforcement agencies have failed tointercept chats on the Blackberry Messenger platform, which runs counters to the home

ministrys recent position that it is satisfied with the interception solution offered by RIM.The latest development comes at a time when the central government has directed all mobile

phone companies to install legal interception gear that can monitor services on everyBlackBerry handset.

RIM has recently warned DoT secretary K Chandrasekhar that blocking its popularBlackBerry services will not end Indias security concerns but induce the legion of internetoffenders to migrate to the innumerable alternate encryption solutions available online.

It also comes at a time when the Canadian smartphone maker edges closer to the October 31deadline for handing over the encryption keys and codes of its corporate mail and messagingservices to the Indian security establishment.The stakes are indeed big for the Canadian smartphone maker, especially since India is one of

its fastest growing markets. Super secure corporate email has been RIMs USP, which hasmade the BlackBerry service an instant hit with high-flier executives.

Today, India has over a million Black-Berry users, although less than 4 lakh subscribe tocorporate email and use BlackBerry Messenger.

The home ministry fears that terrorists can use BlackBerry email and messaging services tocoordinate and plot attacks as information exchanges on these channels cannot be monitored.The crackdown on all communication services offered through channels that could not beintercepted began after 26/11 when security agencies learnt that Pakistani militants usedmobile and satellite phones to coordinate the Mumbai terror strikes.


22. NSN, Ericsson to roll out Vodafones 3G network

SWEDENS Ericsson and Finland-headquartered Nokia Siemens Networks will roll out the 3Gnetwork of Vodafone Essar, one of the largest service providers in the country.


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Vodafone on Wednesday awarded a three-year contract estimated to be worth $500 million tothe gear makers, which are the companys existing equipment vendors. ET had reported thisdevelopment a month ago.Nokia Siemens Networks will supply, implement and manage Vodafones 3G network in

Tamil Nadu, Gujarat, Maharashtra, Uttar Pradesh (East), West Bengal (excluding Kolkata) andHaryana while Ericsson will cover the high-density metros of Mumbai, Delhi and Kolkata.

With the implementation of the 3G rollout, more than 113.77 million Vodafone users wouldbe able to avail of high-end services such as video calling, interactive gaming and use high-speed internet on mobile phones by late December.Vodafone Essar, Bharti Airtel, Reliance Communications, Idea Cellular, Aircel and Tata

Teleservices, which won 3G airwaves in an auction earlier this year, are placing equipmentcontracts collectively worth $3 billion.A few weeks ago, Bharti Airtel gave a 3G network rollout contract to Ericsson India, Nokia

Siemens Networks and Huawei Technologies, estimated by the industry to be worth $700million. The two Chinese vendors will also roll out 3G services for Reliance Communicationsacross 13 circles.Earlier this month, Tata Teleservices had said that Huawei would implement the initiation of

3G services for the company in five circles while Nokia Siemens Networks has bagged the

contract for the remaining four circles. The combined deal size for Tata is said to be under$300 million.Idea Cellular is said to be in talks with a mix of existing vendors including Nokia-Siemens

Networks, Ericsson, Huawei and ZTE for 3G rollouts in 11 circles. Industry insiders peg thecontract at $500 million in the first phase.Ericsson foresees 3 billion new mobile broadband subscriptions by 2015, a ten-fold increase

over five years, and expects 50 billion connected devices by 2020. Further, it anticipates datatraffic to grow 90% annually over the next five years, the company said in a statement


Energy/ Energy Resources

23. IDBI in pact with WRI for energy-saving initiatives

IDBI Bank has tied up with US-based environmental research organisation, World ResourcesInstitute (WRI), for providing consultancy services to its borrowers on energy cost reduction.The cost of implementing the energy-saving initiatives will be funded by IDBI Bank and WRIwill guarantee the savings.Under the agreement, if a companys energy bills dont decline during the stipulated period

and if the company does not repay the loan, IDBI can invoke the WRI guarantee. Energy costis as much as 25% of the cost of production. Besides cost reduction, the move is aimed at the

ecosystem protection. The tie-up is for micro, small and medium enterprises (MSME) segmentand we expect forgi

Documents

e02dcIndustry News Digest (Issue No. 4)