New Delhi: Lanco Infratech will acquire Australiabased Griffin Coal Mining and Carpenter Mine Management (Griffin Coal), continuing the trend of Indian power producers acquiring mines abroad to fuel their plants.
Lanco Infrastructure will acquire the coal mining asset through its subsidiary Lanco Resources Australia. The company did not disclose the deal size but a source directly involved in the matter said the deal was worth around $750 million. Hyderabad-based GVK group, the only rival bidder in the final round, had quoted between $600 and $700 million.
There will be at least five such transactions for overseas coal assets worth $500 to $1 billion by Indian companies next year, said a banker, who is working closely with at least two potential buyers. Power utilities , such as Tata Power and Reliance Power , which have already acquired coal assets abroad, and Lanco, which announced the deal on Wednesday, hope to secure fuel supplies with such acquisitions.
“This is an operating asset. It will help support our coal requirement, but even after this acquisition, a chunk of our coal requirement would be from domestic sources,” chief financial officer Suresh Kumar told ET.
The mine produces over 4 million tonnes a year. The output can be scaled up to over 15 million tones per year after the development of infrastructure.
The acquisition is a part of Lanco Infratech’s strategy to acquire coal assets and linkages for its power projects. The company plans to raise its power generation capacity to 15,000 megawatts (mw) by 2015 from 2,100 mw now, Mr Kumar said.
HSBC, which was Lanco’s financial advisor to this deal, has also promised funding support. An overseas unit of ICICI Bank has also committed funds to Lanco Resources Australia. Griffin was advised on the deal by UBS. The advisor to the GVK group was RBS.
Two other Indian companies from the power and infrastructure space had earlier approached Griffin, which owns the largest coal mines in western Australia. Those two companies backed out before the final round of bidding on valuation mismatch.
“There are only so many coal assets left in the world, mostly in Africa, US, Indonesia and Australia. At some point the buyers will have to step up and match the seller’s price. The price of these assets are unlikely to decline , “ said an investment banker, who represented one of the company’s that earlier backed out.
Success in my Habit
Monday, December 27, 2010
Tata Chemicals' UK subsidiary to take over British Salt
New Delhi: Tata Chemicals Ltd’s UK subsidiary Brunner Mond group has signed a definite agreement to acquire 100% of British Salt Ltd, a leading salt manufacturer in the UK, for £93 million (roughly Rs.655 crore) in a deal that will ensure a steady source of raw material and also give it a toehold in the UK food and industrial salt market.
Brunner Mond makes soda ash, widely used in several chemical industries, consumer products and food ingredients. British Salt has a 50% share in the UK’s pure dried vacuum salt products market, and it owns several brine (salt) wells in that country with a residual life of at least 50 years.
R. Mukundan, managing director, Tata Chemicals, said: “The acquisition is in line with the strategy of Tata Chemicals to deepen its presence in the ‘food and farm sectors’ and will result in securitising raw material for Brunner Mond’s operations. This will help Brunner Mond maintain its low-cost manufacturing position in Europe and provides a great opportunity to optimise the costs further.” An analyst who tracks the sector said the deal was an advantageous one for Tata Chemicals.
“British Salt is an unlisted firm with salt manufacturing capacity of more than 400,000 tonnes, comparable to Tata Chemicals’ domestic capacity of 600,000 tonnes. According to back-of-the-envelope calculations, the company can add Rs.400 crore to the consolidated revenues (3.5% of fiscal 2012 sales) and 5.6% to the consolidated profit for the fiscal 2012,” said Dikshit Mittal, a research analyst at Alchemy Share and Stock Brokers Pvt. Ltd.
Tata Chemicals’ chief financial officer P.K. Ghose said the transaction is entirely financed by debt on a non-recourse basis to itself. This means that the debt raised to fund the acquisition, which was made through Tata Chemicals Europe Holdings Ltd, a holding company, will not directly create a liability for it.
Mittal added that the deal is valued at around six times the operational profit of British Salt and that the transaction seems “fairly valued”.
The Tata group, of which Tata Chemicals Ltd is a part, has had a successful track record of acquisitions in the UK. In the late 1990s, Tata Tea acquired Tetley. More recently, Tata Steel acquired Corus and Tata Motors, Jaguar Land Rover.
Tata Chemicals is currently the world’s second largest producer of soda ash with manufacturing plants in India, the UK, Kenya and the US.
On Monday, its shares rose 0.12% to close at Rs.371.60 on the Bombay Stock Exchange on a day when the exchange’s benchmark index, the Sensex, went up 0.12% to close at 19,888.88.
Brunner Mond makes soda ash, widely used in several chemical industries, consumer products and food ingredients. British Salt has a 50% share in the UK’s pure dried vacuum salt products market, and it owns several brine (salt) wells in that country with a residual life of at least 50 years.
R. Mukundan, managing director, Tata Chemicals, said: “The acquisition is in line with the strategy of Tata Chemicals to deepen its presence in the ‘food and farm sectors’ and will result in securitising raw material for Brunner Mond’s operations. This will help Brunner Mond maintain its low-cost manufacturing position in Europe and provides a great opportunity to optimise the costs further.” An analyst who tracks the sector said the deal was an advantageous one for Tata Chemicals.
“British Salt is an unlisted firm with salt manufacturing capacity of more than 400,000 tonnes, comparable to Tata Chemicals’ domestic capacity of 600,000 tonnes. According to back-of-the-envelope calculations, the company can add Rs.400 crore to the consolidated revenues (3.5% of fiscal 2012 sales) and 5.6% to the consolidated profit for the fiscal 2012,” said Dikshit Mittal, a research analyst at Alchemy Share and Stock Brokers Pvt. Ltd.
Tata Chemicals’ chief financial officer P.K. Ghose said the transaction is entirely financed by debt on a non-recourse basis to itself. This means that the debt raised to fund the acquisition, which was made through Tata Chemicals Europe Holdings Ltd, a holding company, will not directly create a liability for it.
Mittal added that the deal is valued at around six times the operational profit of British Salt and that the transaction seems “fairly valued”.
The Tata group, of which Tata Chemicals Ltd is a part, has had a successful track record of acquisitions in the UK. In the late 1990s, Tata Tea acquired Tetley. More recently, Tata Steel acquired Corus and Tata Motors, Jaguar Land Rover.
Tata Chemicals is currently the world’s second largest producer of soda ash with manufacturing plants in India, the UK, Kenya and the US.
On Monday, its shares rose 0.12% to close at Rs.371.60 on the Bombay Stock Exchange on a day when the exchange’s benchmark index, the Sensex, went up 0.12% to close at 19,888.88.
Lincoln Pharma ties up with US based Human Biosciences Inc
Mumbai/ Ahmedabad: Ahmedabad based Lincoln Pharmaceuticals Ltd. (LPL), has tied up with US based Human Biosciences Inc (HBI) for exclusive marketing and distribution of two of HBI's wound care management products in India, Medifil and Skin Temp that enjoy a 22 per cent market share in its category in India. The company can set up a manufacturing unit in the future to increase production of these products.
Speaking on the development, Mahendra G Patel, managing director, Lincoln Pharmaceutical Ltd. said, “Our mission at Lincoln Pharmaceuticals is to provide customers with healthcare products of high quality at an affordable price. We are planning to set up a manufacturing unit in India to increase production and expand our reach so that more people can avail the benefits of these products.”
Collagen products have reconstructive properties and are meant for wound care management.
Medifil and Skin Temp, considered a helps to stop the bleeding immediately by providing faster and better wound healing.
In addition, it has better aesthetic value as it heals without leaving any scar formation. Medifil and Skin Temp are specifically useful in repairing wounds during plastic and burns surgery, general surgery, orthopedic surgery and gynecological surgery and is particularly beneficial for diabetic amputations due to its faster healing properties. Medifil is available in an absorbable Collagen based granule and Skin Temp in an absorbable Collagen based patch.
Lincoln Pharmaceuticals is into manufacturing and marketing therapeutic products under WHO-GMP guidelines.
Speaking on the development, Mahendra G Patel, managing director, Lincoln Pharmaceutical Ltd. said, “Our mission at Lincoln Pharmaceuticals is to provide customers with healthcare products of high quality at an affordable price. We are planning to set up a manufacturing unit in India to increase production and expand our reach so that more people can avail the benefits of these products.”
Collagen products have reconstructive properties and are meant for wound care management.
Medifil and Skin Temp, considered a helps to stop the bleeding immediately by providing faster and better wound healing.
In addition, it has better aesthetic value as it heals without leaving any scar formation. Medifil and Skin Temp are specifically useful in repairing wounds during plastic and burns surgery, general surgery, orthopedic surgery and gynecological surgery and is particularly beneficial for diabetic amputations due to its faster healing properties. Medifil is available in an absorbable Collagen based granule and Skin Temp in an absorbable Collagen based patch.
Lincoln Pharmaceuticals is into manufacturing and marketing therapeutic products under WHO-GMP guidelines.
ONGC gets Brazil's approval to farm out block in Santos basin
New Delhi: ANP, the petroleum regulatory authority of Brazil, has approved farming out a block to ONGC Videsh Ltd. ONGC Campos Limitada (OCL), Brazil, a wholly-owned subsidiary of OVL, had acquired the 100 per cent stake in the block, BM-S-73 (formerly S-M-1413) during ninth bidding round in 2007.
The offshore concession is located in the Santos basin and covers an area of 160.04 square kilometres. The concession is a part of Brazil’s ninth licensing round and is currently in exploration phase, OVL said in a press statement.
ONGC Campos Limitada, Petroleo Brasileiro SA, Petrobras and Ecopetrol Oleo Gas do Brasil LTDA, had entered into an agreement under the terms of which Petrobras will get 43.5 per cent share, Ecopetrol will get 13 per cent in the block BM-S-73 and 43.5 per cent will remain with ONGC Campos Limitada, the operator of the block.
ONGC Campos Limitada will get 43.5 per cent share from Petrobras and Ecopetrol in their block BM-S-74, who will have 43.5 per cent and 13 per cent share, respectively. The approval for this block is still awaited.
The offshore concession is located in the Santos basin and covers an area of 160.04 square kilometres. The concession is a part of Brazil’s ninth licensing round and is currently in exploration phase, OVL said in a press statement.
ONGC Campos Limitada, Petroleo Brasileiro SA, Petrobras and Ecopetrol Oleo Gas do Brasil LTDA, had entered into an agreement under the terms of which Petrobras will get 43.5 per cent share, Ecopetrol will get 13 per cent in the block BM-S-73 and 43.5 per cent will remain with ONGC Campos Limitada, the operator of the block.
ONGC Campos Limitada will get 43.5 per cent share from Petrobras and Ecopetrol in their block BM-S-74, who will have 43.5 per cent and 13 per cent share, respectively. The approval for this block is still awaited.
Indian firms grab 34% of SA govt's AIDS drug order
New Delhi: Indian companies have bagged 34.3 per cent of the AIDS drugs supply contracts announced by the South African government last week. The anti-retroviral drug tender floated by South Africa is the largest of its kind in the world.
Of the Rs 2,831 crore worth order for anti-retroviral drugs, about Rs 970 crore have come to four Indian companies primarily through the joint venture (JV) entities set up by Ranbaxy and Cipla, the South African Health Ministry has stated.
While Ranbaxy’s South African JV Sonke Pharmaceuticals bagged a supply contract that comes to 21.9 per cent (over Rs 600 crore) of the total tender value, Cipla-Medpro cornered 5.1 per cent (about Rs 145 crore) share. The other two firms are Strides Acrolab (4.2 per cent or approximately Rs 118 crore) and Aurobindo Pharma (3.1 per cent or approximately Rs 90 crore).
On the whole, 10 firms won the tenders, the supplies for which will begin from January 1, 2011 and go on till December 31, 2012.
With 40 per cent share, South African firm Aspen Pharmacare claimed the highest pie. Ranbaxy’s JV is the second in the list. Ranbaxy will manufacture the medicines from its South African and Indian facilities, a company statement said.
The institutional supplies in overseas countries are increasingly becoming a major business model for Indian medicine exporters as more countries, including UK and Europe, are looking at reducing their healthcare costs. South Africa had succeeded in bringing down the cost of its ARV drug procurement by 53.1 per cent by making the tenders more competitive.
Of the Rs 2,831 crore worth order for anti-retroviral drugs, about Rs 970 crore have come to four Indian companies primarily through the joint venture (JV) entities set up by Ranbaxy and Cipla, the South African Health Ministry has stated.
While Ranbaxy’s South African JV Sonke Pharmaceuticals bagged a supply contract that comes to 21.9 per cent (over Rs 600 crore) of the total tender value, Cipla-Medpro cornered 5.1 per cent (about Rs 145 crore) share. The other two firms are Strides Acrolab (4.2 per cent or approximately Rs 118 crore) and Aurobindo Pharma (3.1 per cent or approximately Rs 90 crore).
On the whole, 10 firms won the tenders, the supplies for which will begin from January 1, 2011 and go on till December 31, 2012.
With 40 per cent share, South African firm Aspen Pharmacare claimed the highest pie. Ranbaxy’s JV is the second in the list. Ranbaxy will manufacture the medicines from its South African and Indian facilities, a company statement said.
The institutional supplies in overseas countries are increasingly becoming a major business model for Indian medicine exporters as more countries, including UK and Europe, are looking at reducing their healthcare costs. South Africa had succeeded in bringing down the cost of its ARV drug procurement by 53.1 per cent by making the tenders more competitive.
India, Singapore bilateral trade to touch US$ 22.89 billion in 2010
New Delhi: The bilateral trade between India and Singapore is expected to touch US$ 22.89 billion in 2010, according to Dr T C A Raghavan, Indian High Commissioner to Singapore.
"Singapore is a very important partner of India," said Raghavan, while addressing Singapore press conference for 'The India Show 2011' to be held January 14-16, 2011 in the Singapore. He further added that "We have seen a very good recovery from 2008 and a good financial investment climate."
Furthermore, Mr Anand Sharma, Commerce and Industry Minister would lead India’s high level ministerial and CEOs delegation to Singapore for ‘The India Show.’ The show is largest ever of its kind in Southeast Asia.
About 80 Indian corporations will be exhibiting at the show, which would also have a symposium aimed at further nurturing the good relationship between the two countries.
The January 14 'India Symposium' - themed 'Indovations: Ideas for the World', would highlight the innovation in the Indian manufacturing, services and infrastructure sectors. The show is part of the Indian government's 'Look East Policy,' and would familiarise business visitors with the latest in Indian products and technology, help them understand the trends and offer opportunities in various sectors of the Indian economy as well as have the corporate worlds of the two countries discuss business co-operations.
The Indian businesses participating in the show would be seeking to establish partnership and strategic links with Singapore's small and medium enterprises (SME) as well as major corporations in the infrastructure sector, especially seeking out water-technology and urban development expertise, Raghavan added.
Among others, ANTRIX, the Indian space research organisation (ISRO), would be participating in the show. It would launch Singapore's first commercial satellite in about a month, said Dr Raghavan.
"Singapore is a very important partner of India," said Raghavan, while addressing Singapore press conference for 'The India Show 2011' to be held January 14-16, 2011 in the Singapore. He further added that "We have seen a very good recovery from 2008 and a good financial investment climate."
Furthermore, Mr Anand Sharma, Commerce and Industry Minister would lead India’s high level ministerial and CEOs delegation to Singapore for ‘The India Show.’ The show is largest ever of its kind in Southeast Asia.
About 80 Indian corporations will be exhibiting at the show, which would also have a symposium aimed at further nurturing the good relationship between the two countries.
The January 14 'India Symposium' - themed 'Indovations: Ideas for the World', would highlight the innovation in the Indian manufacturing, services and infrastructure sectors. The show is part of the Indian government's 'Look East Policy,' and would familiarise business visitors with the latest in Indian products and technology, help them understand the trends and offer opportunities in various sectors of the Indian economy as well as have the corporate worlds of the two countries discuss business co-operations.
The Indian businesses participating in the show would be seeking to establish partnership and strategic links with Singapore's small and medium enterprises (SME) as well as major corporations in the infrastructure sector, especially seeking out water-technology and urban development expertise, Raghavan added.
Among others, ANTRIX, the Indian space research organisation (ISRO), would be participating in the show. It would launch Singapore's first commercial satellite in about a month, said Dr Raghavan.
Indices to measure price changes in services to roll out by March
New Delhi: India will soon have indices measuring price changes in services that account for above 60% of the national income, helping in more accurate measures of inflation.
The government has shortlisted 10 sectors for which indices will be created, an official with the industries ministry told ET. At least two of them could be rolled out by the end of March 2011 while another four will be ready by the end of the next fiscal, he said.
“These (the indices) would give a more comprehensive picture of the price trends in the economy,” said C Rangarajan , Chairman of the Prime Minister’s Economic Advisory Council (PMEAC).
The services that would have price indices include transport, banking, insurance, communication, ports and storage. Defence services, health and education are three other sectors that will have a price index. All the indices will add up to a single index for services.
Over the years, services have become the most dynamic sector of the economy. They contributed above 60% of the country’s gross domestic product (GDP) in 2009-10, up from 29% in 1950.
“We are currently able to track the services production to some extent by the GDP estimates, but the trend in prices is not very clear,” said Indranil Pan, chief economist at private sector lender Kotak Mahindra Bank .
The only reliable price measure India has at present is the wholesale price index (WPI) for goods. The consumer price index for industrial workers has some implicit elements of services, but otherwise there is no measure available to measure the price changes in the largest sector of the economy.
The most comprehensive measure of inflation, the GDP deflator , is also based on inputs from the wholesale price index and retail indices.
It has to be recognised that creating an index for services is far more difficult than creating an index for goods, said CP Chandrasekhar, professor of economics at Jawaharlal Nehru University, who chairs the committee that is developing the index.
United Kingdom, a financial nerve centre of the world, is still developing a price index for banking, legal and accountancy services.
Before an index is created, it goes through a stage where various methodologies are assessed and one is selected. The users of the index are then given a chance to comment on the methodologies.
Some of the indices are at the second stage where comments have been invited.
The department of industrial policy and promotion, which is coordinating the indices, is also looking into the issue of the periodicity of the release, as data would not be available at the same frequency in every service. Data has to be collected from private and public enterprises and that would also create difficulties.
The government has shortlisted 10 sectors for which indices will be created, an official with the industries ministry told ET. At least two of them could be rolled out by the end of March 2011 while another four will be ready by the end of the next fiscal, he said.
“These (the indices) would give a more comprehensive picture of the price trends in the economy,” said C Rangarajan , Chairman of the Prime Minister’s Economic Advisory Council (PMEAC).
The services that would have price indices include transport, banking, insurance, communication, ports and storage. Defence services, health and education are three other sectors that will have a price index. All the indices will add up to a single index for services.
Over the years, services have become the most dynamic sector of the economy. They contributed above 60% of the country’s gross domestic product (GDP) in 2009-10, up from 29% in 1950.
“We are currently able to track the services production to some extent by the GDP estimates, but the trend in prices is not very clear,” said Indranil Pan, chief economist at private sector lender Kotak Mahindra Bank .
The only reliable price measure India has at present is the wholesale price index (WPI) for goods. The consumer price index for industrial workers has some implicit elements of services, but otherwise there is no measure available to measure the price changes in the largest sector of the economy.
The most comprehensive measure of inflation, the GDP deflator , is also based on inputs from the wholesale price index and retail indices.
It has to be recognised that creating an index for services is far more difficult than creating an index for goods, said CP Chandrasekhar, professor of economics at Jawaharlal Nehru University, who chairs the committee that is developing the index.
United Kingdom, a financial nerve centre of the world, is still developing a price index for banking, legal and accountancy services.
Before an index is created, it goes through a stage where various methodologies are assessed and one is selected. The users of the index are then given a chance to comment on the methodologies.
Some of the indices are at the second stage where comments have been invited.
The department of industrial policy and promotion, which is coordinating the indices, is also looking into the issue of the periodicity of the release, as data would not be available at the same frequency in every service. Data has to be collected from private and public enterprises and that would also create difficulties.
Domestic air traffic records 25 per cent y-o-y growth
New Delhi: The Indian aviation industry has reported 25 per cent increase on a year-on-year (y-o-y) basis in passengers flown in November 2010, according to the latest data released by the Directorate-General of Civil Aviation (DGCA). Seven domestic airlines flew 4,875,000 passengers in November 2010. It is the highest carriage recorded during a single month in 2010.
The Delhi-based, IndiGo, recorded the best performance carrying 8,43,000 passengers in November 2010 and almost 3,00,000 more passengers than in the corresponding period in the 2009.
Jet Airways and SpiceJet each carried 1,73,000 more passengers compared to November 2009
The Delhi-based, IndiGo, recorded the best performance carrying 8,43,000 passengers in November 2010 and almost 3,00,000 more passengers than in the corresponding period in the 2009.
Jet Airways and SpiceJet each carried 1,73,000 more passengers compared to November 2009
Excise sops on expansion in HP, Uttarakhand to stay
New Delhi: Manufacturers in Himachal Pradesh and Uttarakhand will get excise duty exemptions on even the fresh investment they make to expand capacity or launch a new line of business from their existing plants.
The decision will benefit hundreds of companies such as motorcycle manufacturer Hero Honda and consumer products makers Hindustan Unilever and Dabur .
A circular issued by the Central Board of Excise and Customs (CBEC) says companies running factories in these states will enjoy the excise rebate on addition or modification of their plant or if they produce new products from these plants even though the 100% excise duty holiday had lapsed on March 31.
It added the period of exemption would, however, remain 10 years and not get extended on account of modifications or additions.
The circular follows a finance ministry directive to CBEC to clear the air over the scheme as companies were under the impression that they would not get excise rebate if they made fresh investments in their plants after March 31. This had discouraged them to expand their operations in the two states.
Companies in business in the two states can manufacture new products by enhancing their manufacturing capacities now, said Pratik Jain, a partner at KPMG .
An extreme example would be if a car manufacturer enjoying excise rebate decides to produce food products, he can claim the rebate on new products as well after March 31.
The government had launched the tax rebate scheme to encourage industrial development of the two hill states.
"This issue has been a matter of varied interpretation and disputes, which should now be put to rest and spur investments in these states," Jain added.
States like Punjab had protested the scheme arguing that industrial units were shifting to the two states to enjoy the excise rebate. Analysts say the relaxation in rules is sure to cause more heartburn.
The decision will benefit hundreds of companies such as motorcycle manufacturer Hero Honda and consumer products makers Hindustan Unilever and Dabur .
A circular issued by the Central Board of Excise and Customs (CBEC) says companies running factories in these states will enjoy the excise rebate on addition or modification of their plant or if they produce new products from these plants even though the 100% excise duty holiday had lapsed on March 31.
It added the period of exemption would, however, remain 10 years and not get extended on account of modifications or additions.
The circular follows a finance ministry directive to CBEC to clear the air over the scheme as companies were under the impression that they would not get excise rebate if they made fresh investments in their plants after March 31. This had discouraged them to expand their operations in the two states.
Companies in business in the two states can manufacture new products by enhancing their manufacturing capacities now, said Pratik Jain, a partner at KPMG .
An extreme example would be if a car manufacturer enjoying excise rebate decides to produce food products, he can claim the rebate on new products as well after March 31.
The government had launched the tax rebate scheme to encourage industrial development of the two hill states.
"This issue has been a matter of varied interpretation and disputes, which should now be put to rest and spur investments in these states," Jain added.
States like Punjab had protested the scheme arguing that industrial units were shifting to the two states to enjoy the excise rebate. Analysts say the relaxation in rules is sure to cause more heartburn.
India Inc sealed record US$ 55 billion M&A deals so far in 2010
New Delhi: India Inc sealed mergers and acquisitions (M&A) deals worth US$ 55 billion so far in 2010, including a record number of billion-dollar transactions.
The total deal value surpassed the previous record set in 2007 and big-ticket deals made a comeback as corporate India regained its deal-making appetite with more than US$ 9 billion deals, the highest-ever in a single year.
"Indian companies are ready to pay what they perceive to be the right valuation. They are not just hunting for bargain buys, but they would take advantage of the economic slowdown and the fact that many loss-making companies in developed markets are looking to sell out," according to Freny Patel, Associate Editor, DealReporter (part of Mergermarket Group), Asia-Pacific.
The M&A deals showcased the high global ambitions set up by India Inc who acquired foreign assets worth US$ 27.25 billion with a view to expand their market share.
"There have been acquisitions in South America, Europe, Australia, Singapore, etc, for some time now. More recently, there is a lot of interest in developing economies in Africa, Indonesia, Malaysia, etc," according to C G Srividya, Specialist Advisory Services Partner, Grant Thornton India .
So far in 2010 (till December 15), the total deal announced value amounted to US$ 54.6 billion, significantly more than the previous high of US$ 42 billion achieved in 2007, according to research firm VCCEdge.
The total deal value surpassed the previous record set in 2007 and big-ticket deals made a comeback as corporate India regained its deal-making appetite with more than US$ 9 billion deals, the highest-ever in a single year.
"Indian companies are ready to pay what they perceive to be the right valuation. They are not just hunting for bargain buys, but they would take advantage of the economic slowdown and the fact that many loss-making companies in developed markets are looking to sell out," according to Freny Patel, Associate Editor, DealReporter (part of Mergermarket Group), Asia-Pacific.
The M&A deals showcased the high global ambitions set up by India Inc who acquired foreign assets worth US$ 27.25 billion with a view to expand their market share.
"There have been acquisitions in South America, Europe, Australia, Singapore, etc, for some time now. More recently, there is a lot of interest in developing economies in Africa, Indonesia, Malaysia, etc," according to C G Srividya, Specialist Advisory Services Partner, Grant Thornton India .
So far in 2010 (till December 15), the total deal announced value amounted to US$ 54.6 billion, significantly more than the previous high of US$ 42 billion achieved in 2007, according to research firm VCCEdge.
Fitch revises India's growth to 8.7 per cent for 2010-11
New Delhi: The forecast for the country’s economic expansion has been revised upwards to 8.7 per cent for 2010-11 from 8.5 per cent earlier by the leading global rating agency, Fitch Ratings.
"We revise upwards our forecast for India's GDP growth to 8.7 per cent for the financial year ending March 2011 from 8.5 per cent, as economic activity has proved more buoyant than previously expected," said Fitch in its latest quarterly review 'Global Economic Outlook' released in London.
The report further highlighted that a breakdown of gross domestic product (GDP) numbers by expenditure shows that India's economic activity remains broad-based, with both private and public sector consumption, fixed investment and exports all registering high single-digit growth.
Furthermore, the economy registered a healthy 8.8 per cent growth in the first quarter of 2010-11 and fared still better in the second quarter, recording 8.9 per cent on the back of strong growth in manufacturing and a massive improvement in the farm sector.
"We revise upwards our forecast for India's GDP growth to 8.7 per cent for the financial year ending March 2011 from 8.5 per cent, as economic activity has proved more buoyant than previously expected," said Fitch in its latest quarterly review 'Global Economic Outlook' released in London.
The report further highlighted that a breakdown of gross domestic product (GDP) numbers by expenditure shows that India's economic activity remains broad-based, with both private and public sector consumption, fixed investment and exports all registering high single-digit growth.
Furthermore, the economy registered a healthy 8.8 per cent growth in the first quarter of 2010-11 and fared still better in the second quarter, recording 8.9 per cent on the back of strong growth in manufacturing and a massive improvement in the farm sector.
Govt kicks off FDI retail talks again
New Delhi: Key policy makers in the government have kicked off discussions to liberalise foreign direct investment regime. The government is debating opening up of foreign investment in multi-brand retail sector that employs millions and further liberalising the defence sector.
Finance minister Pranab Mukherjee , home minister P Chidambaram , defence minister A K Antony along with commerce minister Anand Sharma held discussions on further relaxing the foreign direct investment regime on Thursday.
"We will be having more meetings. Policy (formation) is dynamic...we are very progressive and forward looking," Mr Sharma told reporters on Thursday.
The department of industrial policy and promotion had earlier this year put out discussion papers to seek public comments on opening up of multi-brand retail to foreign investment and increasing FDI in defence from 26% to 74%.
The department then set up an inter-ministerial panel to examine public comments and suggest some policy measure. However, the panel is expected to call for wider consultation on opening up multibrand retail sector to foreign investors in its report. Of the 180 respondents only 65 agreed to opening up of the sector and majority 113 opposed it. "The reponses cannot be taken to represent the voice of large number of stakeholders and population at large," the draft report circulated to all members of the panel says.
The final report is expected by month end, according to a person privy to the discussions.
Both the Left and BJP are completely opposed to opening up of multi-brand retail. However, the UPA government , sans the Left, seems more open to the idea of opening up multi-brand retail to FDI.
Finance minister Pranab Mukherjee , home minister P Chidambaram , defence minister A K Antony along with commerce minister Anand Sharma held discussions on further relaxing the foreign direct investment regime on Thursday.
"We will be having more meetings. Policy (formation) is dynamic...we are very progressive and forward looking," Mr Sharma told reporters on Thursday.
The department of industrial policy and promotion had earlier this year put out discussion papers to seek public comments on opening up of multi-brand retail to foreign investment and increasing FDI in defence from 26% to 74%.
The department then set up an inter-ministerial panel to examine public comments and suggest some policy measure. However, the panel is expected to call for wider consultation on opening up multibrand retail sector to foreign investors in its report. Of the 180 respondents only 65 agreed to opening up of the sector and majority 113 opposed it. "The reponses cannot be taken to represent the voice of large number of stakeholders and population at large," the draft report circulated to all members of the panel says.
The final report is expected by month end, according to a person privy to the discussions.
Both the Left and BJP are completely opposed to opening up of multi-brand retail. However, the UPA government , sans the Left, seems more open to the idea of opening up multi-brand retail to FDI.
Tuesday, December 14, 2010
US-based Indian creates first artificial kidney
New Delhi: US-based Indian origin researcher Shuvo Roy has created the world's first implantable artificial kidney. What's sensational about Roy's creation is that the organ, no larger than a coffee cup, will be able to mimic the kidney's most vital functions like filtering toxins out of the bloodstream, regulate blood pressure and produce the all- important vitamin D.
The artificial kidney has been tested successfully on a small number of animals. Large-scale trials on animals and humans are expected over the next five years. Once available, and if affordable, this creation by the Roy-led team at University of California will do away with the need for kidney dialysis.
This will be a boon for all patients with chronic kidney disease (CKD). At present in India, of the 1.5 lakh new patients who suffer from end-stage renal failure annually, only 3,500 get kidney transplants and 6,000-10,000 undergo dialysis. The rest perish due to an acute shortage of dialysis centres and nephrologists to man them.
CKD is rising at a rapid pace in India and the majority of those who perish are either unable to find a suitable organ for transplantation or are unable to pay for the high dialysis costs.
According to Roy, the device has a filtration section to remove toxins from the blood, alongside a compartment with renal cells to conduct other functions of a kidney. He believes the artificial kidney could last for decades and require no pumps or batteries. Patients wouldn't require anti-rejection drugs (as is required after transplants) either because there would be no exposed natural tissues for the immune system to attack.
The University of California team is awaiting approval to conduct larger scale animal and human trials. Already, it has successfully tested the implant in a few rats and pigs.
"The payoff to the patient community is tremendous," said Roy. "It could have a transformative impact on their lives...With the right financial support, I think we could reach clinical trials in five years. But it's hard to say how long after that it becomes commercially available due to the uncertainties of the FDA and commercialization prospects.''
So what would this artificial kidney mean for India? ''It will be a real boon,'' said Dr S C Tiwari, director of nephrology and renal transplantation medicine at Fortis health care. He added: ''The biggest problem with CKD patients in India is that majority of them are diagnosed in the final stages where they would either require constant dialysis or a transplant. They would require dialysis three times week. However, of the two lakh CKD patients requiring dialysis, only 10,000 get it, mainly because they can't afford it. Maybe only 1,000 such patients get it for free or at a subsidized rate in government hospitals. The artificial kidney, when available and if affordable, will be a miracle.'' Dr Madan Bahadur, nephrologist with Mumbai's Jaslok Hospital added, ''Work on creating tubular cells (that perform the biochemical work of the kidney) began a decade back. But bio-chemical engineering has so far not managed to replicate the kidney.''
According to Dr Jitendra Kumar, head of nephrology at Asian Institute of Medical Sciences, the main reason why this artificial kidney will be a real breakthrough is because it will be able to mimic the vital functions of a kidney like regulate BP and produce vitamin D — things a dialysis can't do.
The artificial kidney has been tested successfully on a small number of animals. Large-scale trials on animals and humans are expected over the next five years. Once available, and if affordable, this creation by the Roy-led team at University of California will do away with the need for kidney dialysis.
This will be a boon for all patients with chronic kidney disease (CKD). At present in India, of the 1.5 lakh new patients who suffer from end-stage renal failure annually, only 3,500 get kidney transplants and 6,000-10,000 undergo dialysis. The rest perish due to an acute shortage of dialysis centres and nephrologists to man them.
CKD is rising at a rapid pace in India and the majority of those who perish are either unable to find a suitable organ for transplantation or are unable to pay for the high dialysis costs.
According to Roy, the device has a filtration section to remove toxins from the blood, alongside a compartment with renal cells to conduct other functions of a kidney. He believes the artificial kidney could last for decades and require no pumps or batteries. Patients wouldn't require anti-rejection drugs (as is required after transplants) either because there would be no exposed natural tissues for the immune system to attack.
The University of California team is awaiting approval to conduct larger scale animal and human trials. Already, it has successfully tested the implant in a few rats and pigs.
"The payoff to the patient community is tremendous," said Roy. "It could have a transformative impact on their lives...With the right financial support, I think we could reach clinical trials in five years. But it's hard to say how long after that it becomes commercially available due to the uncertainties of the FDA and commercialization prospects.''
So what would this artificial kidney mean for India? ''It will be a real boon,'' said Dr S C Tiwari, director of nephrology and renal transplantation medicine at Fortis health care. He added: ''The biggest problem with CKD patients in India is that majority of them are diagnosed in the final stages where they would either require constant dialysis or a transplant. They would require dialysis three times week. However, of the two lakh CKD patients requiring dialysis, only 10,000 get it, mainly because they can't afford it. Maybe only 1,000 such patients get it for free or at a subsidized rate in government hospitals. The artificial kidney, when available and if affordable, will be a miracle.'' Dr Madan Bahadur, nephrologist with Mumbai's Jaslok Hospital added, ''Work on creating tubular cells (that perform the biochemical work of the kidney) began a decade back. But bio-chemical engineering has so far not managed to replicate the kidney.''
According to Dr Jitendra Kumar, head of nephrology at Asian Institute of Medical Sciences, the main reason why this artificial kidney will be a real breakthrough is because it will be able to mimic the vital functions of a kidney like regulate BP and produce vitamin D — things a dialysis can't do.
ACME inks supply pact with First Solar for Gujarat plant
Mumbai/ Ahmedabad: Delhi-based ACME Tele Power Ltd (ATPL) and First Solar Inc have inked a module supply agreement, which covers the supply of First Solar’s advanced thin-film modules for a 15 Mw (DC) solar power plant in the state of Gujarat.
A statement issued today informed that the agreement entails building a 15 Mw power generation project in the state of Gujarat. The delivery of thin-film modules is expected to take place by March 2011 to fulfill the Gujarat government’s expectations, the statement said. Manoj Kumar Upadhyay, chairman and managing director, ATPL commented, "This agreement is in line with our endeavour of pioneering turnkey solar technologies in India. We are enthusiastic about working with First Solar to make this ambitious project a success and deliver larger benefits to the country."
Commenting on the signing, T K Kallenbach, executive vice-president of marketing and product management, First Solar, said, "We see India as a land of immense opportunity and potential. We are pleased to collaborate with a leader like ACME and contribute through the development of clean, affordable, sustainable solar electricity utilising our advanced technology and unparalleled experience in large-scale solar PV systems."
A statement issued today informed that the agreement entails building a 15 Mw power generation project in the state of Gujarat. The delivery of thin-film modules is expected to take place by March 2011 to fulfill the Gujarat government’s expectations, the statement said. Manoj Kumar Upadhyay, chairman and managing director, ATPL commented, "This agreement is in line with our endeavour of pioneering turnkey solar technologies in India. We are enthusiastic about working with First Solar to make this ambitious project a success and deliver larger benefits to the country."
Commenting on the signing, T K Kallenbach, executive vice-president of marketing and product management, First Solar, said, "We see India as a land of immense opportunity and potential. We are pleased to collaborate with a leader like ACME and contribute through the development of clean, affordable, sustainable solar electricity utilising our advanced technology and unparalleled experience in large-scale solar PV systems."
Opto Circuits buys 76% of US firm
Chennai/ Bangalore: Bangalore-based healthcare equipment company Opto Circuits (India) Ltd has acquired around 76 per cent of the outstanding common shares of US-based Cardiac Science Corporation as part of its acquisition plans. Earlier, the company had agreed to acquire Cardiac Science Corporation for $64 million.
The company also plans to exercise its top-up option under the terms of the merger agreement, which is expected to occur in the next few days, the company release said.
Following the merger, Cardiac Science will become a wholly-owned subsidiary of Opto Circuits. Cardiac Science specialises in many healthcare equipment in cardiology space including electro-cardiograph devices, cardiac stress treadmills and systems, vital sign monitors among others.
As per the merger deal with Cardiac Science, Opto Circuits has agreed to acquire all the outstanding shares of Cardiac Science for $2.30 per share.
The company has recently acquired two companies to further its business growth both in domestic and international market.
While the company acquired the US-based Unetixs Vascular Inc at $9.7 million in July, it acquired a domestic company, NS Remedies for $1.50 million in April of this year.
Unetixs’ products like vascular diagnostic systems and accessories will be marketed in countries like Europe and West Asia among others.
As per analysts, Unetixs’ that holds 14 patents world wide in peripheral arterial disease (PAD) space, will help Opto to grab a substantial market share in near future.
Similarly, NS Remedies had been acquired by Opto in April this year at an investment of $1.50 million and is expected to provide a cost saving of 20 per cent in stent manufacturing to the company.
The company, presently, sources stent, a critical component of cardiac surgery, from its Germany based Eurocor Gmbh facility.
Opto specialises in range of products like pulse oximeters, pulse oximeter sensors, fluid warmers, cholesterol monitors and stents.
The company also plans to exercise its top-up option under the terms of the merger agreement, which is expected to occur in the next few days, the company release said.
Following the merger, Cardiac Science will become a wholly-owned subsidiary of Opto Circuits. Cardiac Science specialises in many healthcare equipment in cardiology space including electro-cardiograph devices, cardiac stress treadmills and systems, vital sign monitors among others.
As per the merger deal with Cardiac Science, Opto Circuits has agreed to acquire all the outstanding shares of Cardiac Science for $2.30 per share.
The company has recently acquired two companies to further its business growth both in domestic and international market.
While the company acquired the US-based Unetixs Vascular Inc at $9.7 million in July, it acquired a domestic company, NS Remedies for $1.50 million in April of this year.
Unetixs’ products like vascular diagnostic systems and accessories will be marketed in countries like Europe and West Asia among others.
As per analysts, Unetixs’ that holds 14 patents world wide in peripheral arterial disease (PAD) space, will help Opto to grab a substantial market share in near future.
Similarly, NS Remedies had been acquired by Opto in April this year at an investment of $1.50 million and is expected to provide a cost saving of 20 per cent in stent manufacturing to the company.
The company, presently, sources stent, a critical component of cardiac surgery, from its Germany based Eurocor Gmbh facility.
Opto specialises in range of products like pulse oximeters, pulse oximeter sensors, fluid warmers, cholesterol monitors and stents.
Religare buys US PE co Landmark for Rs 770 cr
Mumbai: Religare Enterprises is buying Landmark Partners , a US-based private equity and real estate investment firm with assets under management worth $8.5 billion.
The New Delhi-based financial services group will buy about 55% in Landmark for roughly $170 million, or Rs 770 crore, valuing the American asset manager at over 3.6% of its total assets, said two people familiar with the matter.
Shachindra Nath, group chief executive officer of Religare Enterprises, confirmed the development, but declined to comment on the deal size. “This acquisition is part of our inorganic growth strategy. We have a chest of $1 billion and will use it to buy asset managers worldwide over the next couple of years,” he said. Landmark executives could not be reached for comment.
Earlier this year, Religare bought Northgare Capital, a US-based fund-of-funds manager, but did not disclose the size of the deal.
The company, majority owned by brothers Malvinder and Shivinder Singh, who sold their stake in generic drugs maker Ranbaxy Laboratories to Japan’s Daiichi Sankyo in 2008 for roughly $2 billion, has been in talks to buy asset managers in the US in the last two years.
It was one of the top contenders for the fund management unit of US-based troubled insurance giant AIG last year. Religare was rumoured to be in talks with a couple of domestic mutual funds to buy out their business.
The Landmark acquisition will catapult Religare’s assets under management, including the money managed by Northgate and its Indian mutual fund, to almost $15 billion, Nath said. Reliance Mutual Fund , India’s largest asset management company, had assets worth Rs 1.07 lakh crore or $23 billion on September 30.
Domestic mutual fund industry officials, on condition of anonymity, said the deal is not cheap by valuation standards in developed markets.
“The acquisition is certainly not cheap. Asset management companies in the US and Europe normally would not get more than 2-3% of their assets,” said a top executive of a bank-owned mutual fund. “However, given that there is lot of cheap capital available, Religare can use its expertise in Indian markets to channel it well,” he said.
Asset management companies in emerging markets, including India, are usually valued at 4-6% of their assets because of their growth potential. Recently, L&T Finance, the financial services arm of engineering major Larsen and Toubro, bought DBS Cholamandalam Asset Management for Rs 45 crore, valuing DBS at 1.55% of its total assets under management.
In June last year, Japan’s Nomura bought a stake in LIC Mutual Fund for about 2.5% of fund’s assets. In 2009, IDFC bought Standard Chartered Bank’s asset management business for close to 5.7% of its assets.
The New Delhi-based financial services group will buy about 55% in Landmark for roughly $170 million, or Rs 770 crore, valuing the American asset manager at over 3.6% of its total assets, said two people familiar with the matter.
Shachindra Nath, group chief executive officer of Religare Enterprises, confirmed the development, but declined to comment on the deal size. “This acquisition is part of our inorganic growth strategy. We have a chest of $1 billion and will use it to buy asset managers worldwide over the next couple of years,” he said. Landmark executives could not be reached for comment.
Earlier this year, Religare bought Northgare Capital, a US-based fund-of-funds manager, but did not disclose the size of the deal.
The company, majority owned by brothers Malvinder and Shivinder Singh, who sold their stake in generic drugs maker Ranbaxy Laboratories to Japan’s Daiichi Sankyo in 2008 for roughly $2 billion, has been in talks to buy asset managers in the US in the last two years.
It was one of the top contenders for the fund management unit of US-based troubled insurance giant AIG last year. Religare was rumoured to be in talks with a couple of domestic mutual funds to buy out their business.
The Landmark acquisition will catapult Religare’s assets under management, including the money managed by Northgate and its Indian mutual fund, to almost $15 billion, Nath said. Reliance Mutual Fund , India’s largest asset management company, had assets worth Rs 1.07 lakh crore or $23 billion on September 30.
Domestic mutual fund industry officials, on condition of anonymity, said the deal is not cheap by valuation standards in developed markets.
“The acquisition is certainly not cheap. Asset management companies in the US and Europe normally would not get more than 2-3% of their assets,” said a top executive of a bank-owned mutual fund. “However, given that there is lot of cheap capital available, Religare can use its expertise in Indian markets to channel it well,” he said.
Asset management companies in emerging markets, including India, are usually valued at 4-6% of their assets because of their growth potential. Recently, L&T Finance, the financial services arm of engineering major Larsen and Toubro, bought DBS Cholamandalam Asset Management for Rs 45 crore, valuing DBS at 1.55% of its total assets under management.
In June last year, Japan’s Nomura bought a stake in LIC Mutual Fund for about 2.5% of fund’s assets. In 2009, IDFC bought Standard Chartered Bank’s asset management business for close to 5.7% of its assets.
L&T Infotech in strategic partnership with IBM
Mumbai: L&T Infotech today announced a strategic partnership with IBM in the Business Process Management (BPM) space, using IBM's WebSphere Lombardi Suite of products. This partnership will be let L&T Infotech and IBM to offer BPM solutions such as business process modeling, implementation, integration solutions and services to its clientele. Further, L&T Infotech is launching customisable BPM solutions in the areas of Banking & Financial Services like corporate loans, know your customer, credit card issuance, accounts payable and insurance (claims processing, underwriter workflow) by leveraging Lombardi.
Commenting on the partnership, Abhay Chitnis, VP and head-technology, L&T Infotech, said: “With rapid evolution of IT in recent years, enterprise IT landscape has become increasingly complex. All organisations are striving to improve agility and scalability of the intra and inter-enterprise eco-systems. Our IBM partnership is in line with our constant endeavor to provide added value to our clients. The leadership position enjoyed by IBM Lombardi in the BPM space coupled with L&T Infotech’s domain knowledge and modeling accelerators, provides a unique value proposition to our clients, especially in banking and financial services sector.”
Pradeep Nair, director - Software Group - IBM India/South Asia, added:, "BPM software and services from IBM help organisations optimise business performance by discovering, documenting, automating, and continuously improving business processes to increase efficiency and reduce costs. We know that the combination of IBM Lombardi’s class-leading BPM technology and L&T Infotech’s depth of industry expertise will deliver superior value and most importantly, near-term return on investment, to our clients.”
Currently, L&T Infotech offers BPM services in several verticals such as banking and financial services, energy and petrochemicals, product engineering services (Telecom), insurance and manufacturing. L&T Infotech’s banking and financial services business unit focuses on providing business solutions to leading banks and financial institutions across the globe. Leveraging IBM Lombardi, L&T Infotech's banking and financial services unit has also developed JukeBox+, a domain-centric solution to allow clients to jumpstart their business processes integration and automation activity.
Commenting on the partnership, Abhay Chitnis, VP and head-technology, L&T Infotech, said: “With rapid evolution of IT in recent years, enterprise IT landscape has become increasingly complex. All organisations are striving to improve agility and scalability of the intra and inter-enterprise eco-systems. Our IBM partnership is in line with our constant endeavor to provide added value to our clients. The leadership position enjoyed by IBM Lombardi in the BPM space coupled with L&T Infotech’s domain knowledge and modeling accelerators, provides a unique value proposition to our clients, especially in banking and financial services sector.”
Pradeep Nair, director - Software Group - IBM India/South Asia, added:, "BPM software and services from IBM help organisations optimise business performance by discovering, documenting, automating, and continuously improving business processes to increase efficiency and reduce costs. We know that the combination of IBM Lombardi’s class-leading BPM technology and L&T Infotech’s depth of industry expertise will deliver superior value and most importantly, near-term return on investment, to our clients.”
Currently, L&T Infotech offers BPM services in several verticals such as banking and financial services, energy and petrochemicals, product engineering services (Telecom), insurance and manufacturing. L&T Infotech’s banking and financial services business unit focuses on providing business solutions to leading banks and financial institutions across the globe. Leveraging IBM Lombardi, L&T Infotech's banking and financial services unit has also developed JukeBox+, a domain-centric solution to allow clients to jumpstart their business processes integration and automation activity.
Consumer durable firms step up investments
Mumbai: Consumer durable companies are stepping up investments in production and distribution to cash in on the demand the industry is witnessing.
According to a recent report by research agency Crisil, the Rs 25,000-crore consumer durable industry is slated to grow at a rate of 17-18 per cent over the next five years, to touch Rs 60,000 crore. Already, the festive period, stretching from July to November, has been a good one for most consumer durable companies. Sales growth was in excess of 30 per cent compared to last year when it was just half of that.
"Naturally,” says Amitabh Tiwari, National Head, Sales, LG Electronics. “Companies are keen to take advantage of this boom.”
According to industry estimates, investment, close to Rs 5,000 crore, will be made in the next few years in production and distribution alone with an objective to meet the growing demand.
Companies at the fore front of this investment exercise include the Korean Chaebols LG and Samsung, Japanese major Panasonic and Indian companies such as Onida, Godrej Appliances, Videocon, Voltas, Blue Star, Bajaj Electricals and Havells.
LG, for instance, will make investments of over Rs 1,300 crore in the next few years, which will involve setting up a new plant, most likely in Chennai, say company officials. The firm, the largest consumer durables manufacturer in the country, already has two plants — in Pune and Nodia. Of the Rs 1,300 crore capex, Rs 350-400 crore will go towards ramping up infrastructure and capacity at existing plants, company officials say.
Another Rs 100 crore will be invested in expanding LG’s network of brand shops from 1,100 to 2,000 by the end of next year. Its regional sales offices will also be increased from the current 38 to 47 respectively, says Tiwari.
The country’s second-largest consumer durables maker Samsung, meanwhile, has just inaugurated a new plant at Chennai at an investment of over Rs 335 crore, says the firm’s deputy managing director, Ravinder Zutshi. The plant will produce 1.2 million refrigerators and increase its in-house capacity to 2.6 million refrigerators. Earlier this year, Samsung invested Rs 45 crore to set up a new split air-conditioner (A/C) production line in Noida. This came soon after a new line for split ACs was set up in Chennai last year for Rs 22 crore. All of this puts the company’s total capital expenditure in the last one year at around Rs 400 crore, says Zutshi.
“But this is not all, he says. “In the next five years our investment in Chennai alone will be close to Rs 450 crore (or $100 million).” The firm is also increasing the number of its brand shops by 150 in the next one year. Its current strength is 300.
The third largest manufacturer, Videocon, has earmarked Rs 1,600 crore as capex, which will be utilised to set up a plant in Chennai to manufacture LCDs, say company sources.
As the top three players ramp up investments, Japanese major Panasonic is set to plough in over Rs 1,000 crore in the next three years to set up among others its manufacturing plants in the country, which will come up in Haryana. The company will also set up a state-of-the-art research and development (R&D) centre; something the Korean Chaebols are also doing. Samsung, for instance, has just set up a performance innovation centre in India — the fourth after the US, China and UK — which will design and develop new innovative products.
Rival LG is also upgrading its Indian R&D centre so that it can design and develop both white and brown goods for global markets.
Of the Indian companies, Onida, says the firm’s vice-president, sales, marketing and service, K Sriram has commissioned a new plant at Rourkee in Uttar Pradesh to manufacture washing machines. The initial investment will be Rs 60 crore, he says.
Godrej Appliances is investing Rs 100 crore to set up new lines at its Pune and Mohali factories, while air-conditioning majors such as Voltas and Blue Star will pump in Rs 40 crore and Rs 21 crore, respectively, this year towards capex.
Lighting companies such as Bajaj Electricals and Havells are also ramping up production investing Rs 25 crore and Rs 200 crore, respectively. “Consumer sentiment is good,” said R Ramakrishnan, executive director, Bajaj Electricals. “The mood is positive. This is resulting in capacity expansion because most players anticipate growth to be good in the sector.”
According to a recent report by research agency Crisil, the Rs 25,000-crore consumer durable industry is slated to grow at a rate of 17-18 per cent over the next five years, to touch Rs 60,000 crore. Already, the festive period, stretching from July to November, has been a good one for most consumer durable companies. Sales growth was in excess of 30 per cent compared to last year when it was just half of that.
"Naturally,” says Amitabh Tiwari, National Head, Sales, LG Electronics. “Companies are keen to take advantage of this boom.”
According to industry estimates, investment, close to Rs 5,000 crore, will be made in the next few years in production and distribution alone with an objective to meet the growing demand.
Companies at the fore front of this investment exercise include the Korean Chaebols LG and Samsung, Japanese major Panasonic and Indian companies such as Onida, Godrej Appliances, Videocon, Voltas, Blue Star, Bajaj Electricals and Havells.
LG, for instance, will make investments of over Rs 1,300 crore in the next few years, which will involve setting up a new plant, most likely in Chennai, say company officials. The firm, the largest consumer durables manufacturer in the country, already has two plants — in Pune and Nodia. Of the Rs 1,300 crore capex, Rs 350-400 crore will go towards ramping up infrastructure and capacity at existing plants, company officials say.
Another Rs 100 crore will be invested in expanding LG’s network of brand shops from 1,100 to 2,000 by the end of next year. Its regional sales offices will also be increased from the current 38 to 47 respectively, says Tiwari.
The country’s second-largest consumer durables maker Samsung, meanwhile, has just inaugurated a new plant at Chennai at an investment of over Rs 335 crore, says the firm’s deputy managing director, Ravinder Zutshi. The plant will produce 1.2 million refrigerators and increase its in-house capacity to 2.6 million refrigerators. Earlier this year, Samsung invested Rs 45 crore to set up a new split air-conditioner (A/C) production line in Noida. This came soon after a new line for split ACs was set up in Chennai last year for Rs 22 crore. All of this puts the company’s total capital expenditure in the last one year at around Rs 400 crore, says Zutshi.
“But this is not all, he says. “In the next five years our investment in Chennai alone will be close to Rs 450 crore (or $100 million).” The firm is also increasing the number of its brand shops by 150 in the next one year. Its current strength is 300.
The third largest manufacturer, Videocon, has earmarked Rs 1,600 crore as capex, which will be utilised to set up a plant in Chennai to manufacture LCDs, say company sources.
As the top three players ramp up investments, Japanese major Panasonic is set to plough in over Rs 1,000 crore in the next three years to set up among others its manufacturing plants in the country, which will come up in Haryana. The company will also set up a state-of-the-art research and development (R&D) centre; something the Korean Chaebols are also doing. Samsung, for instance, has just set up a performance innovation centre in India — the fourth after the US, China and UK — which will design and develop new innovative products.
Rival LG is also upgrading its Indian R&D centre so that it can design and develop both white and brown goods for global markets.
Of the Indian companies, Onida, says the firm’s vice-president, sales, marketing and service, K Sriram has commissioned a new plant at Rourkee in Uttar Pradesh to manufacture washing machines. The initial investment will be Rs 60 crore, he says.
Godrej Appliances is investing Rs 100 crore to set up new lines at its Pune and Mohali factories, while air-conditioning majors such as Voltas and Blue Star will pump in Rs 40 crore and Rs 21 crore, respectively, this year towards capex.
Lighting companies such as Bajaj Electricals and Havells are also ramping up production investing Rs 25 crore and Rs 200 crore, respectively. “Consumer sentiment is good,” said R Ramakrishnan, executive director, Bajaj Electricals. “The mood is positive. This is resulting in capacity expansion because most players anticipate growth to be good in the sector.”
Passenger car sales grew by 20.79 per cent in November 2010
New Delhi: The domestic passenger car sales grew by 20.79 per cent to 1,61,497 units in November 2010 as compared to 1,33,703 units in the same month in 2009.
The sales of motorcycle in the country during the month grew by 15.61 per cent to 7,10,182 units from 6,14,274 units in the corresponding month in 2009, according to the latest figures released by the Society of Indian Automobile Manufacturers (SIAM).
Similarly, the two-wheeler sales in November 2010 grew by 17.68 per cent to 9,30,370 units from 7,90,613 units in November 2009. Furthermore, the sales of commercial vehicles increased by 18.26 per cent to 48,314 units in November 2010 from 40,855 units in the year-ago period, as per SIAM.
Moreover, the total sale of vehicles across categories has registered a growth of 17.81 per cent to 12,21,981 units in November 2010 as against 10,37,232 units in the same month in 2009, as per SIAM.
The sales of motorcycle in the country during the month grew by 15.61 per cent to 7,10,182 units from 6,14,274 units in the corresponding month in 2009, according to the latest figures released by the Society of Indian Automobile Manufacturers (SIAM).
Similarly, the two-wheeler sales in November 2010 grew by 17.68 per cent to 9,30,370 units from 7,90,613 units in November 2009. Furthermore, the sales of commercial vehicles increased by 18.26 per cent to 48,314 units in November 2010 from 40,855 units in the year-ago period, as per SIAM.
Moreover, the total sale of vehicles across categories has registered a growth of 17.81 per cent to 12,21,981 units in November 2010 as against 10,37,232 units in the same month in 2009, as per SIAM.
Health insurance grows 42% in H1
Mumbai: Aided by government health schemes and correction in rates, insurance for health and personal accidents recorded highest growth in the non-life insurance segment during the first half of the financial year.
According to the data released by the Insurance Regulatory and Development Authority, the health segment grew 42 per cent followed by personal accident that grew 25 per cent. State-sponsored schemes like the Rashtriya Swasthya Bima Yojana (RSBY) forms a large part of the health insurance segment. “These schemes are contributing to the growth of health insurance,” said S L Mohan, secretary, General Insurance Council. The health insurance space is buzzing with activities, with the government launching various schemes. The government has launched RSBY for people below the poverty line, while implementing other plans like the Employee State Insurance Scheme and Balika Samriddhi Yojana.
Two standalone health insurance companies – Max Bupa and Religare –started operation in the current financial year. Old players like ICICI Lombard are also betting on health in a big way. “Both retail and group health insurance are growing. Group has turned profitable now, as there is a correction in price. Awareness about insuring health and medical costs has also gone up,” said Tata AIG General Insurance MD and CEO Gaurav Garg.
Insurance companies collected Rs 4,898 crore from health in the first six months. Motor, along with motor-own damage and third-party, constituted for most of the pie (around Rs 15,000 crore collectively).
“Growth in the motor insurance will depend on sales and manufacturing,” added Mohan. Fire, which was the highest-growing segment for non-life insurance companies, witnessed 19 per cent growth in the first half, while liability insurance grew 16 per cent.
Marine hull and engineering saw a single digit growth, while aviation grew over 11 per cent. Premium rates on aviation have hardened almost 10-15 per cent since January. During the period, the non-life insurance sector grew 23 per cent to Rs 20,679 crore compared to the year-ago period. The industry experts expect the growth to be close to 20 per cent in the current financial year.
According to the data released by the Insurance Regulatory and Development Authority, the health segment grew 42 per cent followed by personal accident that grew 25 per cent. State-sponsored schemes like the Rashtriya Swasthya Bima Yojana (RSBY) forms a large part of the health insurance segment. “These schemes are contributing to the growth of health insurance,” said S L Mohan, secretary, General Insurance Council. The health insurance space is buzzing with activities, with the government launching various schemes. The government has launched RSBY for people below the poverty line, while implementing other plans like the Employee State Insurance Scheme and Balika Samriddhi Yojana.
Two standalone health insurance companies – Max Bupa and Religare –started operation in the current financial year. Old players like ICICI Lombard are also betting on health in a big way. “Both retail and group health insurance are growing. Group has turned profitable now, as there is a correction in price. Awareness about insuring health and medical costs has also gone up,” said Tata AIG General Insurance MD and CEO Gaurav Garg.
Insurance companies collected Rs 4,898 crore from health in the first six months. Motor, along with motor-own damage and third-party, constituted for most of the pie (around Rs 15,000 crore collectively).
“Growth in the motor insurance will depend on sales and manufacturing,” added Mohan. Fire, which was the highest-growing segment for non-life insurance companies, witnessed 19 per cent growth in the first half, while liability insurance grew 16 per cent.
Marine hull and engineering saw a single digit growth, while aviation grew over 11 per cent. Premium rates on aviation have hardened almost 10-15 per cent since January. During the period, the non-life insurance sector grew 23 per cent to Rs 20,679 crore compared to the year-ago period. The industry experts expect the growth to be close to 20 per cent in the current financial year.
India, France aim for euro 12-bn bilateral trade by 2012
New Delhi: India and France have set the target to achieve euro 12 billion worth of bilateral trade by 2012, with the two countries vowing to forge deeper ties across all sectors and boost two-way investment. More than 100 French companies have also committed to putting in euro 10 billion in the next couple of years.
Some big-ticket investment plans were announced by the visiting French business delegation today. These include the setting up of two new nuclear generation power plants, or European Pressurised Reactors (EPRs), in Jaitapur, to be developed by French nuclear giant Areva and the $1-billion investment by Michelin to set up a radial tyre manufacturing unit near Chennai.
“This year, we hope that the bilateral trade would reach $8 billion. The two countries today had delegation-level talks, which turned out to be substantive and meaningful. We also established institutional engagements. Besides cooperation in nuclear energy, we also identified some priority sectors like infrastructure, ICT, pharmaceuticals, agro-processing and food processing,” Commerce and Industry Minister Anand Sharma told reporters after talks with French Minister of Economy and Finance Christine Lagarde, here today.
At present, around 750 French companies are present in India, employing 200,000 people. The French delegation has also assured India of supporting the feasibility study for a project to clean the Ganga.
The delegation is accompanying French President Nicolas Sarkozy.
Highlighting India’s concerns to protect farmers, Lagarde said there was a need to open the multi-brand retail sector. French conglomerate Carrefour has long been planning to enter the Indian retail.
“The euro 10-billion commitment by French companies to invest in India between 2008 and 2012 could be a lot more, if opportunities come up by the opening of insurance and multi-brand retail. French companies would respond in a rigorous manner,” Lagarde said.
Allaying her concerns, Planning Commission Deputy Chairman Montek Singh Ahluwalia said removing foreign direct investment (FDI) cap on insurance and multi-brand retail was very much on the government’s agenda.
“We are looking into it. However, policy formulations must involve all stakeholders,” Sharma said. India and France also signed a memorandum to boost investment flows. The MoU was signed by Invest India, Invest in France Agency and Ubifrance, the French agency for international business development.
Some big-ticket investment plans were announced by the visiting French business delegation today. These include the setting up of two new nuclear generation power plants, or European Pressurised Reactors (EPRs), in Jaitapur, to be developed by French nuclear giant Areva and the $1-billion investment by Michelin to set up a radial tyre manufacturing unit near Chennai.
“This year, we hope that the bilateral trade would reach $8 billion. The two countries today had delegation-level talks, which turned out to be substantive and meaningful. We also established institutional engagements. Besides cooperation in nuclear energy, we also identified some priority sectors like infrastructure, ICT, pharmaceuticals, agro-processing and food processing,” Commerce and Industry Minister Anand Sharma told reporters after talks with French Minister of Economy and Finance Christine Lagarde, here today.
At present, around 750 French companies are present in India, employing 200,000 people. The French delegation has also assured India of supporting the feasibility study for a project to clean the Ganga.
The delegation is accompanying French President Nicolas Sarkozy.
Highlighting India’s concerns to protect farmers, Lagarde said there was a need to open the multi-brand retail sector. French conglomerate Carrefour has long been planning to enter the Indian retail.
“The euro 10-billion commitment by French companies to invest in India between 2008 and 2012 could be a lot more, if opportunities come up by the opening of insurance and multi-brand retail. French companies would respond in a rigorous manner,” Lagarde said.
Allaying her concerns, Planning Commission Deputy Chairman Montek Singh Ahluwalia said removing foreign direct investment (FDI) cap on insurance and multi-brand retail was very much on the government’s agenda.
“We are looking into it. However, policy formulations must involve all stakeholders,” Sharma said. India and France also signed a memorandum to boost investment flows. The MoU was signed by Invest India, Invest in France Agency and Ubifrance, the French agency for international business development.
Direct tax collections surge 17.85% in April-Nov
New Delhi: A milestone in direct tax revenue receipts has been achieved with net collections up to end November crossing the 50 per cent mark of the targeted Budget Estimate of Rs 4.3-lakh crore for 2010-11.
For the April-November 2010 period, the Centre's net direct tax collections stood at Rs 2.17-lakh crore, reflecting a 17.85 per cent increase over the Rs 1.84-lakh crore collected in the same period last year, official data released on Tuesday showed.
While corporate tax collections during the same period grew 22.30 per cent, personal income-tax collections (including STT and residual FBT/BCTT) grew 10.66 per cent.
In April-November 2009, the Centre's net direct tax collections recorded 3.71 per cent increase on a year-on-year basis while corporate tax collections grew 3.17 per cent, personal income-tax collections went up 4.53 per cent.
Meanwhile, the Centre's net direct tax collections in November grew 18.33 per cent to touch Rs 12,277 crore (Rs 10,375 crore). While corporate tax collections grew 31 per cent to Rs 4,210 crore (Rs 3,214 crore), personal income-tax collections (including STT, residual FBT/BCTT) grew 13.6 per cent to Rs 8,046 crore (Rs 7,083 crore).
In November 2009, the Centre's net direct tax collections had recorded a 0.3 per cent increase to Rs 10,375 crore on a year-on-year basis.
In April-November 2010, the Centre's securities transaction tax (STT) collections recorded a 0.55 per cent increase to Rs 4,373 crore (Rs 4,349 crore). STT collections in November 2010 stood at Rs 771 crore, reflecting a near 60 per cent increase over Rs 484 crore collected in November last year. STT is a tax on stock market trades.
India is looking to bring in a new Direct Taxes Code that is expected to come into force from April 1, 2012.
The Bill for the new Direct Taxes Code has already been introduced in the Lok Sabha and is now being examined by a standing committee of Parliament.
For the April-November 2010 period, the Centre's net direct tax collections stood at Rs 2.17-lakh crore, reflecting a 17.85 per cent increase over the Rs 1.84-lakh crore collected in the same period last year, official data released on Tuesday showed.
While corporate tax collections during the same period grew 22.30 per cent, personal income-tax collections (including STT and residual FBT/BCTT) grew 10.66 per cent.
In April-November 2009, the Centre's net direct tax collections recorded 3.71 per cent increase on a year-on-year basis while corporate tax collections grew 3.17 per cent, personal income-tax collections went up 4.53 per cent.
Meanwhile, the Centre's net direct tax collections in November grew 18.33 per cent to touch Rs 12,277 crore (Rs 10,375 crore). While corporate tax collections grew 31 per cent to Rs 4,210 crore (Rs 3,214 crore), personal income-tax collections (including STT, residual FBT/BCTT) grew 13.6 per cent to Rs 8,046 crore (Rs 7,083 crore).
In November 2009, the Centre's net direct tax collections had recorded a 0.3 per cent increase to Rs 10,375 crore on a year-on-year basis.
In April-November 2010, the Centre's securities transaction tax (STT) collections recorded a 0.55 per cent increase to Rs 4,373 crore (Rs 4,349 crore). STT collections in November 2010 stood at Rs 771 crore, reflecting a near 60 per cent increase over Rs 484 crore collected in November last year. STT is a tax on stock market trades.
India is looking to bring in a new Direct Taxes Code that is expected to come into force from April 1, 2012.
The Bill for the new Direct Taxes Code has already been introduced in the Lok Sabha and is now being examined by a standing committee of Parliament.
Exports in November 2010 touch US$ 18.9 billion
New Delhi: Exports from India have increased by 26.8 per cent year-on-year (y-o-y) to touch US$ 18.9 billion in November 2010, urging the Government to exude confidence that overall shipments in 2010-11 may touch US$ 215 billion.
For the April-November 2010 period, exports have grown by 26.7 per cent to US$ 140.3 billion, while imports clocked US$ 222 billion, expanding 24 per cent.
“Exports are doing pretty well... At this rate, four months from now, you are looking at anywhere between $210 billion and 215 billion,” according to Mr Rahul Khullar, the Commerce Secretary. Earlier, the government had set an export target of US$ 200 billion for 2010-11, against the shipments of US$ 179 billion in 2009-10.
For the April-November 2010 period, exports have grown by 26.7 per cent to US$ 140.3 billion, while imports clocked US$ 222 billion, expanding 24 per cent.
“Exports are doing pretty well... At this rate, four months from now, you are looking at anywhere between $210 billion and 215 billion,” according to Mr Rahul Khullar, the Commerce Secretary. Earlier, the government had set an export target of US$ 200 billion for 2010-11, against the shipments of US$ 179 billion in 2009-10.
Monday, December 6, 2010
JSW Energy to buy Canadian firm for C$422 m
Mumbai: JSW Energy is to acquire Toronto-listed CIC Energy for about Canadian $422 million.
CIC is developing the Mmamabula Energy Complex at its Mmamabula coalfield in south-eastern Botswana.
There are plans to develop coal mines, set up power plants and convert coal to hydrocarbon there.
The deal is expected to be completed by the last quarter of this fiscal.
Coal reserves
Mr Sajjan Jindal, Chairman, JSW Energy, said, “CIC has approximately 2.6 billion tonnes of coal reserves in the Mmamabula region which are NI 43-101 compliant. The reserves have good quality thermal coal with low sulphur content that is adequate to meet all the project requirements of JSW Energy.”
Coal production in the fields is expected to commence in three to five years.
Mr N.K. Jain, Vice-Chairman, JSW Energy, said: “The reserves can be exploited with an exportable surplus of up to 20 million tonnes per annum over the next 40 years. The reserves can also meet the requirement to set up power plants in Botswana with a capacity of up to 2,000 MW.”
The acquisition will be effected by a step-down subsidiary of JSW Energy.
In May, JSW Steel acquired coking coal mines in the US to tie up supplies for its steel plants, besides the acquisition of coal assets by JSW Energy.
JSW Energy has an operational capacity of 1,430 MW. Additionally 1,710 MW of generating capacity is in an advanced stage of completion. The company is targeting an aggregate generating capacity of 12,070 MW by 2015-16.
CIC is developing the Mmamabula Energy Complex at its Mmamabula coalfield in south-eastern Botswana.
There are plans to develop coal mines, set up power plants and convert coal to hydrocarbon there.
The deal is expected to be completed by the last quarter of this fiscal.
Coal reserves
Mr Sajjan Jindal, Chairman, JSW Energy, said, “CIC has approximately 2.6 billion tonnes of coal reserves in the Mmamabula region which are NI 43-101 compliant. The reserves have good quality thermal coal with low sulphur content that is adequate to meet all the project requirements of JSW Energy.”
Coal production in the fields is expected to commence in three to five years.
Mr N.K. Jain, Vice-Chairman, JSW Energy, said: “The reserves can be exploited with an exportable surplus of up to 20 million tonnes per annum over the next 40 years. The reserves can also meet the requirement to set up power plants in Botswana with a capacity of up to 2,000 MW.”
The acquisition will be effected by a step-down subsidiary of JSW Energy.
In May, JSW Steel acquired coking coal mines in the US to tie up supplies for its steel plants, besides the acquisition of coal assets by JSW Energy.
JSW Energy has an operational capacity of 1,430 MW. Additionally 1,710 MW of generating capacity is in an advanced stage of completion. The company is targeting an aggregate generating capacity of 12,070 MW by 2015-16.
Tata taps MIT to light up low-income houses
Leslie D'Monte/ Cambridge: The Tata group is investing millions of dollars in Sun Catalytix — an energy storage and renewable fuels company — founded by a Massachusetts Institute of Technology (MIT) professor, Daniel Nocera. The aim is to introduce a low-cost solar contraption to power homes for the poor, primarily in developing countries like India.
The Tata group is well known for its bias towards low-cost innovations like the Nano car and Swach water filter.
Sun Catalytix’s prototype can split hydrogen from any source of water, be it river water, sea water or even human waste. Once the water molecules are split into hydrogen and oxygen, the hydrogen powers fuel cells. Built at a cost of around $20 (around '920), it is expected to hit the market in 18 months. “We have the capability to power a household with just two bottles of water from any source,” claims Nocera, who is also director of MIT’s Solar Revolutions Project and the ENI Solar Frontiers Centre.
The reasoning is simple. Solar power, up until now, has been a daytime-only energy source. But storing extra solar energy for use when the sun sets is expensive. Sun Catalytix also believes batteries have a limitation when it comes to storing electrical energy. The company’s prototype, hence, has taken a cue from nature — the process of photosynthesis — whereby plants and bacteria use energy from sunlight to produce sugar, which cellular respiration converts into adenosine tri-phosphate, or ATP, the ‘fuel’ used by all living things.
It was around two years ago that Nocera and Matthew Kanan, a post-doctoral fellow in Nocera’s lab, had announced the details of the experiment. They have since refined it further. “By eliminating expensive precious metals and substantially reducing costs, our technology promises to enable the conversion of electrical, solar or wind energy into storable energy at low cost,” says Nocera.
The contraption, according to Prof Nocera, has advantages over current electrolysers, which split water with electricity and are often used for industrial purposes. But they are not suited for artificial photosynthesis because they are very expensive (around $12,000 per Kw) “and require a highly basic (non-benign) environment that has little to do with the conditions under which photosynthesis operates”.
Tata Sons Chairman Ratan Tata is understood to be taking a personal interest in the project, while simultaneously providing personnel from his group companies to make this project successful. The Tata group has a joint venture with BP Solar, Tata BP Solar, which is one of the largest solar companies in Asia.
Ralf Speth, CEO of Jaguar Land Rover (a Tata company), is on the board of Sun Catalytix. While the Tata group has officially pumped $9.5 million into the company, people with knowledge of the development say the investment is much more and that Ratan Tata is a co-owner. Other investors include Polaris Venture Partners. Amir Nashat is acting CEO of Sun Catalytix.
In July 2009, the government unveiled a $19-billion plan to produce 20 Gw of solar power by 2020, wherein solar-powered equipment and applications would be mandatory in all government buildings, including hospitals and hotels. Further, in the 2010-11 Budget, the government had announced an allocation of $227 million towards the Jawaharlal Nehru National Solar Mission and the establishment of a Clean Energy Fund.
Currently, though, solar power is much more expensive than power generated by other sources of energy like wind, coal and water. The government, therefore, has to subsidise solar power.
Meanwhile, other companies like Amyris of the US are also developing genetic-engineering technologies that change the way microbes process sugar, turning them into “biorefineries” that could provide alternatives to products derived from petroleum.
The Tata group is well known for its bias towards low-cost innovations like the Nano car and Swach water filter.
Sun Catalytix’s prototype can split hydrogen from any source of water, be it river water, sea water or even human waste. Once the water molecules are split into hydrogen and oxygen, the hydrogen powers fuel cells. Built at a cost of around $20 (around '920), it is expected to hit the market in 18 months. “We have the capability to power a household with just two bottles of water from any source,” claims Nocera, who is also director of MIT’s Solar Revolutions Project and the ENI Solar Frontiers Centre.
The reasoning is simple. Solar power, up until now, has been a daytime-only energy source. But storing extra solar energy for use when the sun sets is expensive. Sun Catalytix also believes batteries have a limitation when it comes to storing electrical energy. The company’s prototype, hence, has taken a cue from nature — the process of photosynthesis — whereby plants and bacteria use energy from sunlight to produce sugar, which cellular respiration converts into adenosine tri-phosphate, or ATP, the ‘fuel’ used by all living things.
It was around two years ago that Nocera and Matthew Kanan, a post-doctoral fellow in Nocera’s lab, had announced the details of the experiment. They have since refined it further. “By eliminating expensive precious metals and substantially reducing costs, our technology promises to enable the conversion of electrical, solar or wind energy into storable energy at low cost,” says Nocera.
The contraption, according to Prof Nocera, has advantages over current electrolysers, which split water with electricity and are often used for industrial purposes. But they are not suited for artificial photosynthesis because they are very expensive (around $12,000 per Kw) “and require a highly basic (non-benign) environment that has little to do with the conditions under which photosynthesis operates”.
Tata Sons Chairman Ratan Tata is understood to be taking a personal interest in the project, while simultaneously providing personnel from his group companies to make this project successful. The Tata group has a joint venture with BP Solar, Tata BP Solar, which is one of the largest solar companies in Asia.
Ralf Speth, CEO of Jaguar Land Rover (a Tata company), is on the board of Sun Catalytix. While the Tata group has officially pumped $9.5 million into the company, people with knowledge of the development say the investment is much more and that Ratan Tata is a co-owner. Other investors include Polaris Venture Partners. Amir Nashat is acting CEO of Sun Catalytix.
In July 2009, the government unveiled a $19-billion plan to produce 20 Gw of solar power by 2020, wherein solar-powered equipment and applications would be mandatory in all government buildings, including hospitals and hotels. Further, in the 2010-11 Budget, the government had announced an allocation of $227 million towards the Jawaharlal Nehru National Solar Mission and the establishment of a Clean Energy Fund.
Currently, though, solar power is much more expensive than power generated by other sources of energy like wind, coal and water. The government, therefore, has to subsidise solar power.
Meanwhile, other companies like Amyris of the US are also developing genetic-engineering technologies that change the way microbes process sugar, turning them into “biorefineries” that could provide alternatives to products derived from petroleum.
India to start power trade with Sri Lanka by 2014
New Delhi: The two countries are likely to sign an MoU for the Rs 2,500-crore project.
The government’s initiative to have trading of electricity with Sri Lanka is likely to bear fruit by mid-2014, with the commissioning of a high capacity power transmission link between the two countries. Power Grid Corporation of India (PGCIL), the country’s largest electricity transmission utility and the implementing agency for the project from the Indian side, is likely to sign a memorandum of understanding (MoU) for developing the Rs 2,500-crore project with the neighbouring country by next month.
The 285-kilometre India-Sri Lanka power link, which includes submarine cables over 50 km, will enable the two countries to trade their surplus power with each other, thereby offering a cheaper option to bridge their power generation deficits and also manage peak demand. “We are going to sign the MoU with the Sri Lankan side for the project in December. After this, it will take us six months to start work on the development of the project. We will complete the project within three years,” Power Grid Chairman and Managing Director S K Chaturvedi told Business Standard.
While India generally reels under an overall 12 per cent peak power deficit currently, minute electricity surplus in eastern and southern grids become available seasonally. “With the commissioning of the Krishnapatnam Ultra Mega Power Project (UMPP) in Andhra Pradesh, tradeble surplus would become available,” Chaturvedi said.
UMPPs are large-sized projects being developed by the private sector. The Krishnapatnam UMPP is being developed by Anil Dhirubhai Ambani-owned Reliance Power and is likely to be commissioned by 2015. The link will help Sri Lanka reduce its use of expensive fuels and import cheaper power from India’s surplus. For India, the link will help open a new market for its projected surplus of power.
The subsea line would initially have a capacity of transmitting 500 Mw, according to Power Grid’s feasibility report. “Later, the power flow could be ramped up to 1,000 Mw, beginning 2016, when the power generation capacities in the two countries improve, with surplus availability especially in the Indian southern grid,” Chaturvedi said.
The completion of the proposed undersea transmission link, however, would also depend on the commissioning of NTPC’s 500 Mw imported coal-based power project being planned to be set up at Trincomalee in Sri Lanka. The undersea project would be useful in evacuation of power from the plant.
“The transmission project is linked to the Trincomalee plant. It takes at least four-five years to set up a coal-based project, while my project takes only three years for completion,” Chaturvedi said. While the work on NTPC’s project has not begun, an official from NTPC said the construction work would begin as soon as all the necessary approvals were obtained.
Powergrid and Ceylon Electricity Board (CEB), the largest electricity company of Sri Lanka, will lay down cables under the Gulf of Mannar between Rameswaram in Tamil Nadu and Talaimannar in Sri Lanka.
Globally, transnational undersea power transmission lines have been laid so far only between the UK and the France for transferring 2,000 Mw of electricity. The Philippines plans to set up similar transmission links to connect its islands through the undersea electricity network.
The government’s initiative to have trading of electricity with Sri Lanka is likely to bear fruit by mid-2014, with the commissioning of a high capacity power transmission link between the two countries. Power Grid Corporation of India (PGCIL), the country’s largest electricity transmission utility and the implementing agency for the project from the Indian side, is likely to sign a memorandum of understanding (MoU) for developing the Rs 2,500-crore project with the neighbouring country by next month.
The 285-kilometre India-Sri Lanka power link, which includes submarine cables over 50 km, will enable the two countries to trade their surplus power with each other, thereby offering a cheaper option to bridge their power generation deficits and also manage peak demand. “We are going to sign the MoU with the Sri Lankan side for the project in December. After this, it will take us six months to start work on the development of the project. We will complete the project within three years,” Power Grid Chairman and Managing Director S K Chaturvedi told Business Standard.
While India generally reels under an overall 12 per cent peak power deficit currently, minute electricity surplus in eastern and southern grids become available seasonally. “With the commissioning of the Krishnapatnam Ultra Mega Power Project (UMPP) in Andhra Pradesh, tradeble surplus would become available,” Chaturvedi said.
UMPPs are large-sized projects being developed by the private sector. The Krishnapatnam UMPP is being developed by Anil Dhirubhai Ambani-owned Reliance Power and is likely to be commissioned by 2015. The link will help Sri Lanka reduce its use of expensive fuels and import cheaper power from India’s surplus. For India, the link will help open a new market for its projected surplus of power.
The subsea line would initially have a capacity of transmitting 500 Mw, according to Power Grid’s feasibility report. “Later, the power flow could be ramped up to 1,000 Mw, beginning 2016, when the power generation capacities in the two countries improve, with surplus availability especially in the Indian southern grid,” Chaturvedi said.
The completion of the proposed undersea transmission link, however, would also depend on the commissioning of NTPC’s 500 Mw imported coal-based power project being planned to be set up at Trincomalee in Sri Lanka. The undersea project would be useful in evacuation of power from the plant.
“The transmission project is linked to the Trincomalee plant. It takes at least four-five years to set up a coal-based project, while my project takes only three years for completion,” Chaturvedi said. While the work on NTPC’s project has not begun, an official from NTPC said the construction work would begin as soon as all the necessary approvals were obtained.
Powergrid and Ceylon Electricity Board (CEB), the largest electricity company of Sri Lanka, will lay down cables under the Gulf of Mannar between Rameswaram in Tamil Nadu and Talaimannar in Sri Lanka.
Globally, transnational undersea power transmission lines have been laid so far only between the UK and the France for transferring 2,000 Mw of electricity. The Philippines plans to set up similar transmission links to connect its islands through the undersea electricity network.
IIFT to set up institute in Africa
Kolkata: The Indian Institute of Foreign Trade (IIFT) will soon have its foreign counterpart with an “IIFT type institute” coming up in one of the “less developed nations” in Africa, Mr K.T. Chacko, Director, IIFT, said here on Wednesday.
The announcement regarding the location of the institute and other details will be made by the Prime Minister, Dr Manmohan Singh, within the coming months, he added.
Mr Chacko was speaking on the sidelines of the National Trade and Logistics Symposium organised by the IIFT here on Wednesday.
Refusing to call it the IIFT's African campus, the director said that according to the prior commitments made by the Prime Minister an “IIFT type institute” will come up in Africa. The African institute will help in developing the managerial capabilities and knowledge base in the continent.
The decision has been taken keeping in mind Africa's immense growth potential and trade benefits in the coming years.
Initially the Indian government will take an active part in setting up the institute and providing infrastructure facilities such as hostel and library. Faculty will also be provided by the IIFT.
“After the initial years, say around five to 10 years, we will hand over the management and running of the institute to the respective government in the country,” Mr Chacko said.
student intake
Mr Chacko added that the IIFT was planning to take in around 200 students for its Kolkata campus. This will be more than the 180 seats that it has in its Delhi one.
At present, IIFT's Kolkata campus has a capacity of 60 students and operates from rented premises in Sector V in Salt Lake, in North 24 Parganas. The institute has been allotted a 10 acre plot of land, seven acres initially and three later, off Eastern Metropolitan Bypass in Kolkata in 2006. Documentation and obtaining clearances had delayed the setting up of the new campus.
The institute expects to start construction work on its Rs 100-crore second campus within the next month. Ramky Infrastructure will carry out construction work on behalf of the institute.
The announcement regarding the location of the institute and other details will be made by the Prime Minister, Dr Manmohan Singh, within the coming months, he added.
Mr Chacko was speaking on the sidelines of the National Trade and Logistics Symposium organised by the IIFT here on Wednesday.
Refusing to call it the IIFT's African campus, the director said that according to the prior commitments made by the Prime Minister an “IIFT type institute” will come up in Africa. The African institute will help in developing the managerial capabilities and knowledge base in the continent.
The decision has been taken keeping in mind Africa's immense growth potential and trade benefits in the coming years.
Initially the Indian government will take an active part in setting up the institute and providing infrastructure facilities such as hostel and library. Faculty will also be provided by the IIFT.
“After the initial years, say around five to 10 years, we will hand over the management and running of the institute to the respective government in the country,” Mr Chacko said.
student intake
Mr Chacko added that the IIFT was planning to take in around 200 students for its Kolkata campus. This will be more than the 180 seats that it has in its Delhi one.
At present, IIFT's Kolkata campus has a capacity of 60 students and operates from rented premises in Sector V in Salt Lake, in North 24 Parganas. The institute has been allotted a 10 acre plot of land, seven acres initially and three later, off Eastern Metropolitan Bypass in Kolkata in 2006. Documentation and obtaining clearances had delayed the setting up of the new campus.
The institute expects to start construction work on its Rs 100-crore second campus within the next month. Ramky Infrastructure will carry out construction work on behalf of the institute.
Bajaj, KTM, Kawasaki plan global pact
Mumbai: The alliance will lead to products suitable to the three companies’ strategy and brand.
In an attempt to give its international plans a major fillip, Bajaj Auto, the country's second-largest motorcycle maker, is working towards bringing the technological prowess of Austrian bike maker KTM and Kawasaki of Japan together to form a global alliance.
The three companies are discussing the matter, which would lead to cost-effective manufacturing programmes for engines, platforms and components, and also a global distribution and marketing set-up.
Developed platforms can be used by the three companies to create different products suitable to their strategy and brand. Platform sharing is more common in car and sport utility vehicle industry, where some companies have multiple brands.
Pune-based Bajaj Auto has a 38.09 per cent stake in KTM, which specialises in making stylish street and off-road bikes. The two companies are in the process of developing a range of high-performance engines to serve domestic and international markets.
This new range of low- and high-capacity engines can be tapped by Kawasaki, one of the world's largest bike makers and a long-time technical partner of Bajaj Auto.
Such a multiple use of similar engines would ease the cost of manufacturing in the long run, said Rajiv Bajaj, managing director of Bajaj Auto.
"Every component is not common, but the basics, like crank cases, shafts and gears, are very similar. So, the trick is one must have scale at the back end, but one must also have specialisation in the front. So, at the front end one, we will sell a (Kawasaki) Ninja, a (KTM) Duke and a (Bajaj) Pulsar, but at the back end, they may have lot of commonality," Bajaj said.
KTM is preparing to launch Duke, a 125cc motorcycle, next year in India. The engine of the bike, likely to be priced above Rs 1 lakh, is developed by KTM and Bajaj.
"With the same people, same knowledge, same standards, they will be making those common parts," Bajaj stated.
Kawasaki - which has so far maintained a low profile in the Indian market, following increasing research and development (R&D) independence of Bajaj Auto - recently formed a subsidiary in India due to increasing demand for its Ninja 250R motorcycle.
The Japanese auto company is studying other emerging markets like China, Southeast Asia and Latin America, to carry over its alliance with Bajaj Auto.
Kawasaki is importing automotive components using the supplier base of Bajaj Auto for models sold in other parts of Asia and aims to start parts supplies to developed market of the United States and Europe.
While Bajaj Auto is helping Kawasaki by selling the latter's models in India through its own dealers, Kawasaki will provide the same assistance to Bajaj Auto in far away international markets. KTM and Kawasaki's products will come out of Bajaj Auto's Chakan plant in Pune.
At present, Kawasaki sells Bajaj bikes in countries like Columbia and the Philippines, and is exploring newer market for further expansion. Likewise, Bajaj plans to use KTM's extensive dealer network in Europe and the US to make a foray with its own range of two-wheelers.
In an attempt to give its international plans a major fillip, Bajaj Auto, the country's second-largest motorcycle maker, is working towards bringing the technological prowess of Austrian bike maker KTM and Kawasaki of Japan together to form a global alliance.
The three companies are discussing the matter, which would lead to cost-effective manufacturing programmes for engines, platforms and components, and also a global distribution and marketing set-up.
Developed platforms can be used by the three companies to create different products suitable to their strategy and brand. Platform sharing is more common in car and sport utility vehicle industry, where some companies have multiple brands.
Pune-based Bajaj Auto has a 38.09 per cent stake in KTM, which specialises in making stylish street and off-road bikes. The two companies are in the process of developing a range of high-performance engines to serve domestic and international markets.
This new range of low- and high-capacity engines can be tapped by Kawasaki, one of the world's largest bike makers and a long-time technical partner of Bajaj Auto.
Such a multiple use of similar engines would ease the cost of manufacturing in the long run, said Rajiv Bajaj, managing director of Bajaj Auto.
"Every component is not common, but the basics, like crank cases, shafts and gears, are very similar. So, the trick is one must have scale at the back end, but one must also have specialisation in the front. So, at the front end one, we will sell a (Kawasaki) Ninja, a (KTM) Duke and a (Bajaj) Pulsar, but at the back end, they may have lot of commonality," Bajaj said.
KTM is preparing to launch Duke, a 125cc motorcycle, next year in India. The engine of the bike, likely to be priced above Rs 1 lakh, is developed by KTM and Bajaj.
"With the same people, same knowledge, same standards, they will be making those common parts," Bajaj stated.
Kawasaki - which has so far maintained a low profile in the Indian market, following increasing research and development (R&D) independence of Bajaj Auto - recently formed a subsidiary in India due to increasing demand for its Ninja 250R motorcycle.
The Japanese auto company is studying other emerging markets like China, Southeast Asia and Latin America, to carry over its alliance with Bajaj Auto.
Kawasaki is importing automotive components using the supplier base of Bajaj Auto for models sold in other parts of Asia and aims to start parts supplies to developed market of the United States and Europe.
While Bajaj Auto is helping Kawasaki by selling the latter's models in India through its own dealers, Kawasaki will provide the same assistance to Bajaj Auto in far away international markets. KTM and Kawasaki's products will come out of Bajaj Auto's Chakan plant in Pune.
At present, Kawasaki sells Bajaj bikes in countries like Columbia and the Philippines, and is exploring newer market for further expansion. Likewise, Bajaj plans to use KTM's extensive dealer network in Europe and the US to make a foray with its own range of two-wheelers.
Zensar acquires US IT solution firm Akibia for $66 million
Mumbai: RPG group-owned Zensar Technologies acquired US-based infrastructure management company PSI Holding, which operates under the name Akibia, in an allcash deal of $66 million, the Indian software exporter said at a conference on Monday.
Furthermore, the company will look at more acquisitions in strategic verticals like business intelligence and remote infrastructure management, or the new regions the company hopes to expand into, RPG group chairman, Harsh Goenka said.
RPG operates several other businesses including Ceat tyres, RPG Lifesciences, and an enterprise in rubber plantations Harrisons Malayalam. Mr Goenka said the group plans to double revenue from the current Rs 18,000 crore over the next three years.
The goal is likely to be achieved through 75% of business growth for existing companies, and the rest through acquisitions, he said.
The company that Zensar has acquired has approximately 10% earnings before interest, tax, depreciation, and amortisation, or Ebitda, margin, said Ganesh Natarajan, vice chairman and managing director, Zensar.
There are no overlapping customers between the acquired and parent companies, he added, suggesting that there is ample scope for cross-selling services to clients of each company. Akibia’s revenue in the year to September was $108 million.
Zensar will be paying performance-linked incentives to the current employees of Akibia in addition to the acquisition costs, the company said. Infrastructure management accounts for less than 10% of the company’s revenue at the moment, Mr Natarajan said. However, by 2013 Zensar expects the business will contribute 30% of revenue.
The revenue growth target for Akibia’s existing business over the next year or two is 10-12%, he said. Yet, the new business of Akibia is likely to be partly offshored, which will possibly aid the overall operating margins of the company.
Typically, Indian software companies offshore work from the US to India, thereby reducing the cost for clients, and also increasing their profit margin on the business.
Furthermore, the company will look at more acquisitions in strategic verticals like business intelligence and remote infrastructure management, or the new regions the company hopes to expand into, RPG group chairman, Harsh Goenka said.
RPG operates several other businesses including Ceat tyres, RPG Lifesciences, and an enterprise in rubber plantations Harrisons Malayalam. Mr Goenka said the group plans to double revenue from the current Rs 18,000 crore over the next three years.
The goal is likely to be achieved through 75% of business growth for existing companies, and the rest through acquisitions, he said.
The company that Zensar has acquired has approximately 10% earnings before interest, tax, depreciation, and amortisation, or Ebitda, margin, said Ganesh Natarajan, vice chairman and managing director, Zensar.
There are no overlapping customers between the acquired and parent companies, he added, suggesting that there is ample scope for cross-selling services to clients of each company. Akibia’s revenue in the year to September was $108 million.
Zensar will be paying performance-linked incentives to the current employees of Akibia in addition to the acquisition costs, the company said. Infrastructure management accounts for less than 10% of the company’s revenue at the moment, Mr Natarajan said. However, by 2013 Zensar expects the business will contribute 30% of revenue.
The revenue growth target for Akibia’s existing business over the next year or two is 10-12%, he said. Yet, the new business of Akibia is likely to be partly offshored, which will possibly aid the overall operating margins of the company.
Typically, Indian software companies offshore work from the US to India, thereby reducing the cost for clients, and also increasing their profit margin on the business.
Indian Bank gets approval to open branch in Jaffna
Chennai: Indian Bank has received the Central Bank of Sri Lanka's nod to open its branch at Jaffna in Sri Lanka, according to its chairman and managing director T M Bhasin.
During his recent visit to Sri Lanka, he had said that the new branch would adopt a different model for its Jaffna operations by forming and lending to self-help groups in sectors such as agriculture, fisheries and dairy.
The bank would deploy the deposits garnered from Jaffna, in Jaffna itself to improve the economic development and to help improve the lives of the people there.
Indian Bank which helped in the formation of more than 450,000 SHGs and financing them through its 29 exclusive microsate branches in India will replicate a similar model in Jaffna.
The bank is also looking at expanding its footprint on the east coast of the island nation with two branches being planned in Batticaloa and Trincomalee by the end of next year. The bank’s Colombo branch which has a balance sheet of 5 billion Sri Lankan rupees, plans to double it in two years. It would also play a major role in the rebuilding and rehabilitation process in Jaffna by financing the houses planned to be built for the displaced people.
Sri Lanka’s infrastructure development is witnessing a boom similar to India which has been growing at a pace of 40 per cent in the last three years. Indian Bank would actively lend for infrastructure development activities through the new branches.
Bhasin further said that the Colombo branch had been ploughing back profits to boost the capital to prepare for higher loan growth.
It already had 3.5 billion rupees by way of capital which was higher than the required 3 billion year-end floor set by the Central Bank of Sri Lanka. If needed, the bank may further infuse capital from India for expansion of credit in the Island nation, he said.
During his recent visit to Sri Lanka, he had said that the new branch would adopt a different model for its Jaffna operations by forming and lending to self-help groups in sectors such as agriculture, fisheries and dairy.
The bank would deploy the deposits garnered from Jaffna, in Jaffna itself to improve the economic development and to help improve the lives of the people there.
Indian Bank which helped in the formation of more than 450,000 SHGs and financing them through its 29 exclusive microsate branches in India will replicate a similar model in Jaffna.
The bank is also looking at expanding its footprint on the east coast of the island nation with two branches being planned in Batticaloa and Trincomalee by the end of next year. The bank’s Colombo branch which has a balance sheet of 5 billion Sri Lankan rupees, plans to double it in two years. It would also play a major role in the rebuilding and rehabilitation process in Jaffna by financing the houses planned to be built for the displaced people.
Sri Lanka’s infrastructure development is witnessing a boom similar to India which has been growing at a pace of 40 per cent in the last three years. Indian Bank would actively lend for infrastructure development activities through the new branches.
Bhasin further said that the Colombo branch had been ploughing back profits to boost the capital to prepare for higher loan growth.
It already had 3.5 billion rupees by way of capital which was higher than the required 3 billion year-end floor set by the Central Bank of Sri Lanka. If needed, the bank may further infuse capital from India for expansion of credit in the Island nation, he said.
Railways' freight revenue grows by 8.4 per cent in October 2010
New Delhi: The Indian Railways has registered a growth of 8.39 per cent in freight revenues in October 2010 as compared to the corresponding period in 2009.
The freight earnings in the month of October 2010 stood at US$ 1.15 billion. The rise is supported by good growth in transportation of coal, raw material movement to steel plants, cement, foodgrains, fertilisers, mineral oil and containers.
The earnings for some of commodities such as coal stood at US$ 444.11 million, cement at US$ 111.41 million, foodgrains at US$ 78 million, fertilisers at US$ 81.53 million, mineral oil at US$ 64.14 million, and container traffic revenue at US$ 60.03 million.
Furthermore, the export traffic for iron ore was 1.78 million tonne (MT) in October 2010, while the revenue from iron ore export traffic stood at US$ 76.23 million.
The freight earnings in the month of October 2010 stood at US$ 1.15 billion. The rise is supported by good growth in transportation of coal, raw material movement to steel plants, cement, foodgrains, fertilisers, mineral oil and containers.
The earnings for some of commodities such as coal stood at US$ 444.11 million, cement at US$ 111.41 million, foodgrains at US$ 78 million, fertilisers at US$ 81.53 million, mineral oil at US$ 64.14 million, and container traffic revenue at US$ 60.03 million.
Furthermore, the export traffic for iron ore was 1.78 million tonne (MT) in October 2010, while the revenue from iron ore export traffic stood at US$ 76.23 million.
India open to joint venture for gas-based fertiliser plants in Saudi
New Delhi: India is keen to set up joint ventures for gas-based fertiliser plants in Saudi Arabia, the Union Commerce and Industry Minister, Mr Anand Sharma, said on Friday.
After a meeting with the Saudi Arabian Minister of Commerce and Industry, Mr Abdullah bin Ahmed Zainal Alireza, here, Mr Sharma said in a statement that, “Indian companies have evinced keen interest in setting up of such projects (gas-based fertiliser plants) in the Kingdom of Saudi Arabia.”
He added that while the trade ties are already quite substantial, there is immense potential for taking it to a higher level.
The statement said both sides felt that the focus is to be shifted to investment and joint ventures for enhancing trade in goods and services. It said an emphasis on regular exchange of business delegations would also help.
Stating that economic ties would constitute a solid foundation for the development of Indo-Saudi Strategic Partnership, Mr Sharma told his counterpart that strategies should be developed to increase the trade volume in traditional items and diversifying the trade basket.
Bilateral trade growing
India and Saudi Arabia trade has increased from $3.44 billion in 2005-06 to $21 billion in 2009-10. India's exports to Saudi Arabia have increased from $1.8 billion in 2005-06 to $3.9 billion in 2009-10. Major item of export to Saudi Arabia are petroleum products, basmati rice, non-ferrous metals, machinery and instruments, dyes/intermediary and coal tar chemicals.
Imports from Saudi Arabia have increased from $1.63 billion in 2005-06 to $17 billion in 2009-10 and the main items of imports are petroleum products, organic chemicals, artificial resin and plastic.
FDI
The foreign direct investment from Saudi Arabia during April 2000-August 2010 is to the tune of $31.59 Million. Main sectors that attracted FDI from Saudi Arabia are electrical equipments, food processing industries, automobile industry, computer software and hardware and telecommunications.
After a meeting with the Saudi Arabian Minister of Commerce and Industry, Mr Abdullah bin Ahmed Zainal Alireza, here, Mr Sharma said in a statement that, “Indian companies have evinced keen interest in setting up of such projects (gas-based fertiliser plants) in the Kingdom of Saudi Arabia.”
He added that while the trade ties are already quite substantial, there is immense potential for taking it to a higher level.
The statement said both sides felt that the focus is to be shifted to investment and joint ventures for enhancing trade in goods and services. It said an emphasis on regular exchange of business delegations would also help.
Stating that economic ties would constitute a solid foundation for the development of Indo-Saudi Strategic Partnership, Mr Sharma told his counterpart that strategies should be developed to increase the trade volume in traditional items and diversifying the trade basket.
Bilateral trade growing
India and Saudi Arabia trade has increased from $3.44 billion in 2005-06 to $21 billion in 2009-10. India's exports to Saudi Arabia have increased from $1.8 billion in 2005-06 to $3.9 billion in 2009-10. Major item of export to Saudi Arabia are petroleum products, basmati rice, non-ferrous metals, machinery and instruments, dyes/intermediary and coal tar chemicals.
Imports from Saudi Arabia have increased from $1.63 billion in 2005-06 to $17 billion in 2009-10 and the main items of imports are petroleum products, organic chemicals, artificial resin and plastic.
FDI
The foreign direct investment from Saudi Arabia during April 2000-August 2010 is to the tune of $31.59 Million. Main sectors that attracted FDI from Saudi Arabia are electrical equipments, food processing industries, automobile industry, computer software and hardware and telecommunications.
Jewellery exports rise 38% in Oct
Mumbai: Gems and jewellery exports rose sharply in October on re-stocking demand from retailers in developed countries including the US and the European Union. The growth was beyond traders expectations as the demand recovered from last year’s low.
Jewellery shipments were worth $2,922.58 million (Rs 12,979.19 crore) in October, registering a rise of 37.82 per cent (31 per cent in rupee terms) as compared to $2,120.64 million (Rs 9,907.61 crore) in the corresponding month of the previous year, data compiled by the apex trade body the Gems & Jewellery Export Promotion Council showed.
Rajiv Jain, chairman of the council, had estimated the jewellery demand to rise between 15-20 per cent for the current season on rising consumer and retailer demand for the upcoming festival season.
Between April-October period of the current financial year, total exports of gems and jewellery rose 41.64 per cent in dollar terms and 34.48 per cent in rupee terms at $21,395.13 million (Rs 98,088.53 crore) as compared to $15,105.77 million (Rs 72,937.90 crore) in the same period of the previous year.
Overall gems and jewellery imports were at $2,300.64 million (Rs 10,217.13 crore) in October, up 33.60 per cent (26.99 per cent in rupee terms) as compared to $1,722.03 million (Rs 8,045.32 crore) in the same period last year. Imports of rough diamonds were at $6,589.25 million (Rs 30,292.28 crore) in the first seven months, rising 44.86 per cent as compared with the imports at $4,548.65 million (Rs 21,958.11 crore) respectively in the same period of the previous year.
Jewellery shipments were worth $2,922.58 million (Rs 12,979.19 crore) in October, registering a rise of 37.82 per cent (31 per cent in rupee terms) as compared to $2,120.64 million (Rs 9,907.61 crore) in the corresponding month of the previous year, data compiled by the apex trade body the Gems & Jewellery Export Promotion Council showed.
Rajiv Jain, chairman of the council, had estimated the jewellery demand to rise between 15-20 per cent for the current season on rising consumer and retailer demand for the upcoming festival season.
Between April-October period of the current financial year, total exports of gems and jewellery rose 41.64 per cent in dollar terms and 34.48 per cent in rupee terms at $21,395.13 million (Rs 98,088.53 crore) as compared to $15,105.77 million (Rs 72,937.90 crore) in the same period of the previous year.
Overall gems and jewellery imports were at $2,300.64 million (Rs 10,217.13 crore) in October, up 33.60 per cent (26.99 per cent in rupee terms) as compared to $1,722.03 million (Rs 8,045.32 crore) in the same period last year. Imports of rough diamonds were at $6,589.25 million (Rs 30,292.28 crore) in the first seven months, rising 44.86 per cent as compared with the imports at $4,548.65 million (Rs 21,958.11 crore) respectively in the same period of the previous year.
Independent authority to asses impact of government's flagship programmes
New Delhi: The government has decided to set up an independent authority to assess the impact of various public programmes and improve their effectiveness amid criticism of severe leakages in flagship schemes.
The union cabinet on Thursday approved the creation of an Independent Evaluation Office, having committed to such a body in the presidential address to the joint session of both Houses of Parliament in June, 2009.
On Tuesday finance minister Pranab Mukherjee had also sought detailed reports from the comptroller and auditor general (CAG) on whether government’s programmes are achieving their desired objectives and improving the quality of life of our people.
The independent evaluation office will be attached to the Planning Commission and funded by it as well. It will have a governing board chaired by the deputy chairman of the commission. It will have full functional autonomy to discharge its functions. The authority will advise the plan panel and the implementing agencies, helping them develop appropriate management systems.
The authority will draw from resources available from research organizations and its findings will be placed in the public domain.
The cabinet committee on economic affairs approved setting up of five more mega food parks in addition to 10 on going projects, involving a total govern-ment grant of Rs 250 crore.
The scheme which was approved by the government in September, 2008 envisages raising the processing of perishables in the country from the existing 6% to 20%, value addition from 20% to 35% and the share in global food trade from 1.5% to 3% by the year 2015.
The cabinet gave its nod to wind up the National Fund for Rural Development and transfer the residual funds to Council for Advancement of People’s Action and Rural Technology (CAPART), an autonomous body under the ministry of rural development.
The NFRD was set up in 1984 to mobilise funds from individuals, corporate and non-corporate bodies for undertaking rural development activities. The cabinet also approved additional Rs 71.28 crore for Bhopal gas leak victims in line with the the recommendations of the group of ministers.
The union cabinet on Thursday approved the creation of an Independent Evaluation Office, having committed to such a body in the presidential address to the joint session of both Houses of Parliament in June, 2009.
On Tuesday finance minister Pranab Mukherjee had also sought detailed reports from the comptroller and auditor general (CAG) on whether government’s programmes are achieving their desired objectives and improving the quality of life of our people.
The independent evaluation office will be attached to the Planning Commission and funded by it as well. It will have a governing board chaired by the deputy chairman of the commission. It will have full functional autonomy to discharge its functions. The authority will advise the plan panel and the implementing agencies, helping them develop appropriate management systems.
The authority will draw from resources available from research organizations and its findings will be placed in the public domain.
The cabinet committee on economic affairs approved setting up of five more mega food parks in addition to 10 on going projects, involving a total govern-ment grant of Rs 250 crore.
The scheme which was approved by the government in September, 2008 envisages raising the processing of perishables in the country from the existing 6% to 20%, value addition from 20% to 35% and the share in global food trade from 1.5% to 3% by the year 2015.
The cabinet gave its nod to wind up the National Fund for Rural Development and transfer the residual funds to Council for Advancement of People’s Action and Rural Technology (CAPART), an autonomous body under the ministry of rural development.
The NFRD was set up in 1984 to mobilise funds from individuals, corporate and non-corporate bodies for undertaking rural development activities. The cabinet also approved additional Rs 71.28 crore for Bhopal gas leak victims in line with the the recommendations of the group of ministers.
Govt fuels electric cars with Rs 1 lakh incentive
New Delhi: The Society of Manufacturers of Electric Vehicles (SMEV) expects sales of electric two-wheelers to double in the coming months, on the back of a Rs 95 crore incentive scheme announced by the Ministry of New and Renewable Energy (MNRE) today.
Under the scheme, the government will provide financial incentives for each electric vehicle sold in India during the remaining part of the 11th Plan. The scheme, which will come into effect immediately, envisages incentives of up to 20 per cent on ex-factory prices of the vehicles, subject to a limit.
The cap on the incentive will be Rs 4,000 for low-speed electric two-wheelers, Rs 5,000 for high speed electric two- wheelers and Rs 1,00,000 for an electric car.
Sohinder Gill, director, SMEV said, “This could have an immediate impact on sales of electric two-wheelers. In terms of monthly sales, we expect an immediate doubling of sales.” Gill added, a meeting would soon be convened among members to pass on benefits to consumers.
“The incentive is for manufacturers to invest in research activities and enhance capacities. But we are looking at ways to partially pass on the benefits to customers”, added Gill. Electric two-wheelers are priced between Rs 25,000 and Rs 40,000 depending on the speed range.
Manufacturers would, however, have to register with SMEV for availing of the scheme. Registration would be provided on meeting eligibility norms, which include having 30 per cent indigenous content in the vehicles sold, a sizeable operation in retail and after sales outlets and a multi-point check system for accounting the retail sale.
The notification says, the government will take up “dissemination of two-wheelers, three -wheelers and four-wheelers Battery Operated Vehicles (BOV) and R&D and technology demonstration and other activities in the area of Alternative Fuels for Surface Transportation at a total cost of Rs 95 crore during the remaining period of the 11th Plan”.
In 2010-11, the government will subsidise 20,000 units of low speed electric two-wheelers and another 10,000 units of high speed two-wheelers. In 2011-12, the numbers would increase to 80,000 units and 20,000 units low-speed and high-speed two-wheelers respectively. Additionally, the government has also decided to incentivise 100 units of three-wheelers and 140 units of passenger cars in the rest of this year, which would be upped to 166 units and 700 units in the next financial year. The Indian electric two-wheeler market, at present, stands at about 85,000 units annually. Some of the leading electric two-wheeler manufacturers include Hero Electric, Avon Cycles, BSA Motors and Lohia Auto.
Under the scheme, the government will provide financial incentives for each electric vehicle sold in India during the remaining part of the 11th Plan. The scheme, which will come into effect immediately, envisages incentives of up to 20 per cent on ex-factory prices of the vehicles, subject to a limit.
The cap on the incentive will be Rs 4,000 for low-speed electric two-wheelers, Rs 5,000 for high speed electric two- wheelers and Rs 1,00,000 for an electric car.
Sohinder Gill, director, SMEV said, “This could have an immediate impact on sales of electric two-wheelers. In terms of monthly sales, we expect an immediate doubling of sales.” Gill added, a meeting would soon be convened among members to pass on benefits to consumers.
“The incentive is for manufacturers to invest in research activities and enhance capacities. But we are looking at ways to partially pass on the benefits to customers”, added Gill. Electric two-wheelers are priced between Rs 25,000 and Rs 40,000 depending on the speed range.
Manufacturers would, however, have to register with SMEV for availing of the scheme. Registration would be provided on meeting eligibility norms, which include having 30 per cent indigenous content in the vehicles sold, a sizeable operation in retail and after sales outlets and a multi-point check system for accounting the retail sale.
The notification says, the government will take up “dissemination of two-wheelers, three -wheelers and four-wheelers Battery Operated Vehicles (BOV) and R&D and technology demonstration and other activities in the area of Alternative Fuels for Surface Transportation at a total cost of Rs 95 crore during the remaining period of the 11th Plan”.
In 2010-11, the government will subsidise 20,000 units of low speed electric two-wheelers and another 10,000 units of high speed two-wheelers. In 2011-12, the numbers would increase to 80,000 units and 20,000 units low-speed and high-speed two-wheelers respectively. Additionally, the government has also decided to incentivise 100 units of three-wheelers and 140 units of passenger cars in the rest of this year, which would be upped to 166 units and 700 units in the next financial year. The Indian electric two-wheeler market, at present, stands at about 85,000 units annually. Some of the leading electric two-wheeler manufacturers include Hero Electric, Avon Cycles, BSA Motors and Lohia Auto.
Environmental accounting & reporting set to become mandatory for companies: Govt
New Delhi: The government will make it mandatory for companies to report measures taken to prevent environmental damage as it steps up drive to encourage cleaner production methods .
The ministry of corporate affairs is revising the guidelines on corporate social responsibility (CSR) issued last year to add detailed norms on environmental sustainability. The fresh norms relate to efforts to prevent wasteful use of natural resources and ensure scientific treatment of industrial waste.
The existing guidelines, while urging companies to be environmentally conscious, left it for them to take steps. It failed to provide a clear framework for compliance, leading to companies not taking adequate steps.
“The idea is to make companies responsible for the environmental impact of their products and activities,” said a senior official in the ministry of corporate affairs. The rule will come into force by the end of the current fiscal year, he said.
A comprehensive accounting standard on environmental reporting is being worked out by the Institute of Chartered Accountants of India to guide companies in the process. Though the norms are voluntary, they will require companies to report their performance in this regard in the form of disclosures in their annual reports. “The review will put in place an implementation format whereby the work can be effectively monitored,” said another official, who is privy to the review process.
Environmental reporting in India is at a nascent stage, even though its importance has gained significance world-wide.
“While the move to ask a company to report on its environmental sustainability measures is welcome, it could effectively mean that a company would have to comply or explain steps taken,” said an official with industry body Confederation of Indian Industry .
Indian companies have taken sustainability measures as part of their business goals, he said, requesting anonymity. Some big companies such as ITC, for instance, devote significant resources to sustainable development. The company has a sustainability committee to help integrate social and environmental objectives with business strategies and set goals in contributing to climate change mitigation.
The ministry of corporate affairs is revising the guidelines on corporate social responsibility (CSR) issued last year to add detailed norms on environmental sustainability. The fresh norms relate to efforts to prevent wasteful use of natural resources and ensure scientific treatment of industrial waste.
The existing guidelines, while urging companies to be environmentally conscious, left it for them to take steps. It failed to provide a clear framework for compliance, leading to companies not taking adequate steps.
“The idea is to make companies responsible for the environmental impact of their products and activities,” said a senior official in the ministry of corporate affairs. The rule will come into force by the end of the current fiscal year, he said.
A comprehensive accounting standard on environmental reporting is being worked out by the Institute of Chartered Accountants of India to guide companies in the process. Though the norms are voluntary, they will require companies to report their performance in this regard in the form of disclosures in their annual reports. “The review will put in place an implementation format whereby the work can be effectively monitored,” said another official, who is privy to the review process.
Environmental reporting in India is at a nascent stage, even though its importance has gained significance world-wide.
“While the move to ask a company to report on its environmental sustainability measures is welcome, it could effectively mean that a company would have to comply or explain steps taken,” said an official with industry body Confederation of Indian Industry .
Indian companies have taken sustainability measures as part of their business goals, he said, requesting anonymity. Some big companies such as ITC, for instance, devote significant resources to sustainable development. The company has a sustainability committee to help integrate social and environmental objectives with business strategies and set goals in contributing to climate change mitigation.
Friday, December 3, 2010
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