Horticulture exports jump in Apr-Feb

Mumbai: India is stepping up horticulture (fruit and vegetables) exports with improvements in quality and a focus on a market-specific approach.
The data compiled by the Agricultural and Processed Food Products Export Development Authority (Apeda) show India’s exports of fresh fruit have jumped 20.95 per cent in volumes and 17.4 per cent in value during the period between April 2016 and February 2017.
This shows a sharp reversal in trends until last year, when importers overseas were monitoring the quality of horticulture products from India. Many buyers in the European Union and West Asia had suspended imports of fruit and vegetables from India on grounds of quality.
Horticulture has a 10 per cent share in India’s agri and processed food exports recorded by Apeda.
“India has become quality-conscious. Indian horticulture products like fruit and vegetables were not allowed in a number of countries earlier. For example, grapes and mangoes from India were not exported to the European countries. But, market access has been provided now. Most importantly, Indian exporters are focusing on organic products, which have greater demand overseas and also fetch higher realisations. All these have helped India perform well. Still, India is nowhere near its potential and we can look forward to a big jump in horticulture exports,” said Ajay Sahai, director-general and chief executive officer, Federation of Indian Export Organisations (FIEO).
India’s exports of fresh vegetables declined to 699,600.34 tonnes in 2015-16 from 953,731.22 tonnes in 2013-14.
“We have been working closely with farmers in Maharashtra. We train and help them to adopt the best technologies in cultivating grapes. Over the years, we have been able to build a strong farmer outreach programme, having moved up from 12 growers in 2004-05 to more than 600 today. Each year, we are seeing an increase in the number of farmers approaching us for advice in cultivating exportable grapes,” said Ashok Sharma, managing director and chief executive officer, Mahindra Agri Solutions Ltd, an agri arm of Mahindra and Mahindra (M&M).
The entry of large companies including M&M into the farm-to-fork business has helped grapes exports. India’s fresh grapes exports shot up to 156,218.34 tonnes in 2015-16 from 107,257.81 tonnes in the previous year.
“Apart from fresh fruit, India must explore exports of processed horticulture products,” said a senior industry official.
India’s exports of cereals have declined or witnessed marginal growth with shipments of basmati rice falling by a marginal 3.4 per cent in volumes and over 14 per cent in value in the period between April and February.
Exports of non-basmati rice, however, rose by a marginal 2.2 per cent and 4.94 per cent in volume and value terms, respectively.

SAIC signs deal with General Motors to take over Halol plant

New Delhi: China’s largest automaker SAIC Motor Corp has signed a deal with General Motors to buy its GM India’s Halol plant in Gujarat, the company said in a filing with the Shanghai Stock Exchange on Wednesday.
The company did not disclose anything more on the agreement in its Shanghai filing.
The Shanghai-based manufacturer and the American giant had been in talks regarding the handover of the plant, where GM India started making Opel cars in 1996, and Chevrolets from 2003. The facility with an annual production capacity of 110,000 volumes was underutilised over the last few years due to its falling sales and failure to revive with no good product mix.
Last year, Detroit-headquartered General Motors pulled back its $1 billion investment in India amid falling sales and consequent plunge in market share. The company will end operations at the Halol plant on April 28.
SAIC, formerly Shanghai Automotive Industrial Corporation, will take over the plant’s operations as it plans to enter India soon. The Competition Commission’s had already given approval to SAIC Motor HK, part of China’s SAIC Motor Corp, in January this year to acquire certain assets of the Halol plant.
In China, SAIC Motor Corp makes cars in joint ventures with General Motors Co and Volkswagen AG in addition to own-brand vehicles. The company in its Shanghai Stock Exchange filing also reported a 7.4% jump in 2016 profits, though missing its own expectations marginally.
Meanwhile, General Motors India will continue making cars at its Talegaon factory near Pune which has annual capacity of 170,000 volumes. The Chevrolet India-parent last month also signed a three-year wage agreement with 2,500 workers of the Talegaon plant. Under the wage pact for the period April 1, 2017 to March 31, 2020, the average salaries of the employees will go up by Rs 22,000 at the end of the period.
Detroit is also taking a good second look at GM’s India plans now, since none of its recent products have failed to steer a turnaround for the company.

India to soon start auction process for commercial coal mines

New Delhi: The Government of India plans to start the auction process of commercial coal mines in the near future. The Coal Ministry awaits the feedback on the discussion paper floated on this matter. These mines would be free from any restrictions on the end use of coal, and would also provide the freedom to manage production, pricing and marketing strategy to the private players. The auction would include both big and small blocks for commercial mining of coal. The technical qualifications for bidders should have a minimum net worth of Rs 1,500 crore (US$ 230.61 million). Furthermore, they should also have an experience of excavating or handling a minimum of 25 million cubic metre per annum during the previous three years.

Consumption-linked sectors drove rating upgrades in FY17: Crisil

Mumbai: In financial year 2016-17, consumption-linked sectors such as auto ancillaries, packaging and agricultural products continued to drive upgrades, while downgrades continued to dominate investment-linked sectors such as real estate, metals and construction and industrial machinery, said rating agency Crisil Ratings.
Consumption was aided by monsoon, implementation of the Seventh Pay Commission and One Rank One Pension (OROP) recommendations but demonetisation became a dampener towards the end of calendar 2016, especially for rural consumption, the rating agency said in a report, Round-up Fiscal 2017.
Demonetisation also slowed down the pace of upgrades of consumption-linked sectors, it added.
According to the Crisil report, the pace of downgrades declined in the metals sector due to stabilization in prices, policy support in the form of anti-dumping duty and minimum import price and gradual improvement in demand from affordable housing, urban infrastructure and railways.
The rating agency’s upgrade rate moderated to 9.4% in FY17 from 11.3% in FY16, while the downgrade rate declined to 7.7% from 8.4% in the period. Crisil’s rating portfolio for fiscal year 2017 saw 1,335 upgrades compared to 1,092 downgrades in FY17.
“This helped the credit ratio hold above 1 time in fiscal 2017 at 1.22 times—or quite similar to 1.29 times in fiscal 2016,” Crisil said.
It added that the credit quality of corporate India is gradually recovering but underpinning remains fragile still. In fiscal year 2017, debt-weighted credit ratio—the ratio of debt held by firms whose debt ratings have been upgraded against that of firms whose ratings have been downgraded—improved to a five-year high of 0.88 time, against 0.31 time in 2015-16, Crisil said.
The rating agency also said that almost half of rating actions were because of financial profile reasons as almost three-fourths of rating actions in fiscal year 2017 were in the sub-investment grade (“BB” or lower).
The financial reasons for upgrade were better liquidity and improvement in capital structure, while business reasons were mainly robust demand growth and improvement in operating margins.
“Firms upgraded in fiscal 2017 continued to display distinctly better profile compared with those downgraded. Upgraded firms in general had higher profitability, lower indebtedness and better working capital management,” it added.
Liquidity was the key financial reason for more than a third of the downgrades, stemming from lower cash accrual and higher bank limit utilisation. “Weak demand, pressures on operating profitability, and elongated working capital cycle were the main business reasons for downgrades,” Crisil said.
Meanwhile, CARE Ratings said that in March 2017, its Ratings Debt Quality Index (CDQI) saw the largest decline in FY17 to 89.81, influenced primarily by a few downgrades in “AAA” and “A” category ratings. CDQI denotes the quality of debt that can be interpreted over time and juxtaposed with other developments in the financial sector. “Currently, the volume of debt of the sample companies stands at Rs29.53 lakh crore in March 2017,” CARE Ratings said in a note.

UK exchequer chancellor Hammond urges strong ties with India in fintech

Mumbai: British chancellor of the exchequer Philip Hammond on Wednesday said the United Kingdom and India can become strong partner nations in the financial technology (fintech) industry as UK is keen to make its market truly global after its exit from European Union, while on the other hand, investments into India’s fintech sector have been rising over the past year.
Hammond is on a three-day tour called FinTech Trade Mission to India to engage in dialogue with the Indian finance ministry, financial regulators and other industry bodies in order to strengthen UK’s e-conomic and trading relations with the country.
“The vote for the UK to leave the EU was clear. It reflected a desire for Britain to make its own decisions and to determine its own destiny. But it wasn’t a vote for isolation…British companies have invested more in India since 2000 than the United States or any other European nation has done. And investment from UK companies accounts for 1 in 20 Indian jobs in the organised private sector. Indian companies, meanwhile, invest more in Britain than in the rest of the EU put together,” Hammond said while speaking at a conference in Mumbai.
Hammond said Indian companies such as the Tata Group are among the biggest employers in the UK, transforming British businesses with their focused management and long-term investments.
“In the last year we’ve seen the creation of a whole new market, with the world’s first masala bonds issued in London – raising over $1.5 billion. To date, almost 80% of all masala bonds have been issued in London. And we will see even more, very soon from the Indian Renewable Energy Development Agency and the National Highways Authority of India…the UK and India can collaborate to our mutual advantage – in FinTech,” said Hammond.
There are at least 15 India-headquartered banks which are engaged in international banking businesses in the UK. On the other hand, there are several British financial services firms that are present in India’s insurance, asset management, fintech and banking industries.
Hammond hinted that strengthening ties with UK may fulfil India’s appetite for investments, particularly in infrastructure.
“India has 220 million active smartphone users–over three times the entire UK population. What’s more, India’s demonetisation programme means its financial services sector is undergoing a significant transformation…New fintech payment firms, small finance lenders, and insurance players are entering the market. These firms will be crucial in helping the RBI achieve its target of 90% of the population having access to banking services by 2034,” said Hammond.

RIL gets green nod for Rs 13,250cr Dahej unit expansion project

New Delhi, Apr 4 () Reliance Industries Ltd (RIL) has received environment clearance for expansion and debottlenecking of its Dahej petrochemical facility in Gujarat at a cost of Rs 13,250 crore.
The Mukesh Ambani-led firm wants to expand its Dahej facility located in Bharuch district in view of erratic supply of feed stock, change in the government's policy to prioritise domestic supply over industrial sector, adequate supply of Shale gas ethane from the US, besides meeting demand-supply gap of petrochemicals in India.
"Based on the recommendations of the Expert Appraisal Committee (Industry), the Environment Ministry has given the environmental clearance for RIL's expansion project yesterday," a senior government official said.
The green nod to the proposed project, which will be carried out within the existing plant area of 700 hectare, is subject to some conditions, the official said.
The estimated cost of the project is Rs 13,250 crore. A budget of Rs 400 crore will be kept aside for environment protection and conservation.

The fuel used for the proposed project would largely be ethane, lean gas and off gas. The power required for the project will be met from the existing captive power plant.
As per the proposal, RIL Dahej facility presently utilises a mixture of ethane and propane to produce downstream products and by-products.
Dahej facility proposes to modify its feedstock ratio of ethane and propane in the gas cracker plant owing to the availability of shale gas ethane imported from the US.
This change in feedstock mixture will result in higher production of ethylene.
The RIL's proposal also include setting up of new plants including Chlorinated Poly Vinyl Chloride (CPVC), Vinyl Chloride Monomer (VCM), Poly Vinyl Chloride (PVC) and a dedicated Ethane storage tank. LUX MR

Car majors hit top gear in last lap of FY17

New Delhi: Carmakers achieved their best domestic sales figures in March, the last month of the financial year 2016-17, since demonetisation, with more than 10 per cent growth year-on-year (Y-o-Y).
The sector sold over three million units in FY17, a milestone. In FY16, 2.78 million units were sold. India, the fifth-largest passenger vehicle market globally (cars, vans and utility vehicles), had registered a volume growth of about nine per cent in FY17.
Prime Minister Narendra Modi had announced demonetisation of old Rs 500 and Rs 1,000 notes on November 8, 2016, sucking out about 86 per cent of the currency in circulation and hitting demand. Car volumes started recovering in January this year.
The country’s largest carmaker Maruti Suzuki reported a domestic sale of 127,695 vehicles, growing at 7.4 per cent over March 2016. The growth was led by the compact and utility vehicle segment. In FY17, domestic volume of the company stood at 1.44 million, up 10.6 per cent from the previous year.
R S Kalsi, executive director (marketing and sales) at Maruti, said, “Demand for the company’s products remains strong and it continues to see healthy orders for products such as Brezza and Baleno.”

Korean carmaker Hyundai, the second-largest player in the Indian market, reported a growth of 8.6 per cent in March. Rakesh Srivastava, senior vice-president (sales and marketing), said three products — Grand i10, Elite i20 and Creta — drove the March numbers, which stood at 44,757 vehicles. For the entire year, the company sold a record 0.5 million vehicles in the country, growing at more than five per cent.
Utility vehicle major M&M is yet to announce its March numbers. However, it is learnt to be the only player in the list of top five to have shown a decline. The company’s volume is estimated to have declined around six per cent to 25,352 units last month. M&M, the third-largest player in the domestic market, has not seen a single month of growth since demonetisation.
Its full-year performance is also impacted and volume growth has been flat.
Tata Motors has reported a strong volume growth of 82 per cent for March. The company sold 15,433 vehicles in the domestic market during March. Its volume growth in FY17 was 22 per cent.
Mayank Pareek, president of the company’s passenger vehicle business unit, said the demand remained high for Tiago and Hexa. Tata Motors launched a compact sedan Tigor on Wednesday and anticipates stronger growth ahead.
Japanese auto major Honda, which occupies the fifth position in the domestic market, has started seeing growth after a long gap on account of two new products — the new Honda City and the WRV.
Its Japanese peer Toyota has shown a much stronger performance with 80 per cent growth last month. N Raja, director and senior vice-president (sales and marketing), said Toyota is riding on two products — Innova Crysta and Fortuner. Launched almost a year ago, Crysta still commands a waiting of one month.
Renault, which has seen a strong growth in past many months owing to Kwid, is apparently seeing a base effect. Its volume in March declined close to two per cent. A healthy double-digit growth was also posted by Ford, Nissan and Volkswagen.
Amit Kaushik, managing director for the Detroit-based automobile consultancy Urban Science in India, said volumes were being driven by positive sentiments, new launches and favourable interest rates.

“Apprehensions of price increase in the new financial year have also triggered purchases,” he added.

OMCs to invest ~90,000 cr on fuel upgrade

Bhubaneswar: Oil marketing companies (OMCs) will be investing Rs 90,000 crore by 2020 on fuel upgradation programme.
“The oil companies have spent more than Rs 28,000 crore after 2010 which is in addition to Rs 35,000 crore that was already spent till 2010. They will further spend Rs 28,000 crore by 2020 for meeting the BS-VI specifications which will take the total investment to Rs 90,000 crore only on fuel upgradation programme itself," said K D Tripathi, secretary, ministry of Petroleum and Natural Gas at the launching of BS-IV grade fuels across the country.
“Our fuel quality standards have been gradually tightened since the mid 90’s. Investing on fuel quality improvement was critical to the success of the vehicular emissions programme. Our refineries have achieved the target with the introduction of advanced technologies with significant capital expenditure”, he added.
It may be noted that the fuel upgradation programme took off with the notification of vehicular emission norms for new vehicles in 1991. BS 2000 (Bharat Stage 1) vehicle emission norms were introduced for new vehicles from April 2000 and this was followed by BS-II emission norms for new cars in Delhi from 2000 and extended to the other metros in 2001. BS- III was implemented in phases during 2005-2010. The current BS-IV fuel with 50 ppm sulphur was introduced in year and today, it covered the entire country.

However, the government, in 2016, has decided to meet the international best practices to leapfrog directly to BS-VI norms by skipping BS-V altogether by April 1, 2020.
There are about 23 oil refineries in India with a combined capacity of 230 million tonnes per annum.
“Today, we begin a new era of clean transportation fuels that will benefit 1.25 billion citizens of our country by substantially reducing pollution levels in our cities," Dharmendra Pradhan, minister of state for Petroleum and Natural Gas said.
He also complimented the OMCs- Indian Oil Corporation Ltd (IOCL), Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation (HPCL) for working in unison to launch the BS-IV grade fuels as per the schedule.

India adds record 5,400MW wind power in 2016-17

New Delhi: India added a record 5,400 megawatts (MW) of wind power in 2016-17, exceeding its 4,000MW target.
“This year’s achievement surpassed the previous higher capacity addition of 3,423MW achieved in the previous year,” the ministry of new renewable energy said a statement on Sunday.
Of about 50,018MW of installed renewable power across the country, over 55% is wind power.
In India, which is the biggest greenhouse gas emitter after the US and China, renewable energy currently accounts for about 16% of the total installed capacity of 315,426MW.
During 2016-17, the leading states in the wind power capacity addition were Andhra Pradesh at 2,190MW, followed by Gujarat at 1,275MW and Karnataka at 882MW.
In addition, Madhya Pradesh, Rajasthan, Tamil Nadu, Maharashtra, Telangana and Kerala reported 357MW, 288MW, 262MW, 118MW, 23MW and 8MW wind power capacity addition respectively during the same period.
At the Paris Climate Summit in December, India promised to achieve 175GW of renewable energy capacity by 2022. This includes 60GW from wind power, 100GW from solar power, 10GW from biomass and 5GW from small hydro projects.
It also promised to achieve 40% of its electricity generation capacity from non-fossil fuel based energy resources by 2030.
In the last couple of years, India has not only seen record low tariffs for solar power but wind power too has seen a significant drop in tariffs. In February, solar power tariffs hit a record low of Rs2.97 per kilowatt hour (kWh)and wind power tariff reached Rs3.46 kWh.
Even though wind leads India’s renewable power sector, it has huge growth potential. According to government estimates, the onshore wind power potential alone is about 302GW. But there are several problems plaguing the sector.
For instance, the government has been concerned about squatters blocking good wind potential sites, inordinate delays in signing of power purchase agreements, timely payments and distribution firms shying away from procuring electricity generated from wind energy projects. In January, the ministry held a meeting with the states to sort out these issues.
The ministry has also taken several other policy initiatives, including introducing bidding in the wind energy sector and drafting a wind-solar hybrid policy.
It has also come out with a ‘National Offshore Wind Energy Policy’, aiming to harness wind power along India’s 7,600 km coastline. Preliminary estimates show the Gujarat coastline has the potential to generate around 106,000MW of offshore wind energy and Tamil Nadu about 60,000MW.

RBI increases FPI limits in govt bonds by Rs170 billion

New Delhi: The Reserve Bank of India (RBI) has raised the limit on investment in government bonds by foreign portfolio investors (FPI) by an aggregate Rs 170 billion (US$ 2.62 billion) during the April-June 2017 period. The investment limit in central government securities have been increased by Rs 110 billion (US$ 1.7 billion), which takes the total increase in the investment caps in g-secs by FPIs up to Rs 2,310 billion (US$ 35.63 billion) from Rs 2,200 billion (US$ 35.32 billion) earlier. The limit for State development loans have been raised by Rs 60 billion (US$ 925 million), thereby increasing the total limit to Rs 270 billion (US$ 4.16 billion) from the earlier Rs 210 billion (US$ 3.24 billion). The cap on general category has been increased to Rs 1,565 billion (US$ 24.14 billion) from Rs 1,520 billion (US$ 23.45 billion), whereas the limit for long term investors have been raised to Rs 745 billion (US$ 11.49 billion) from Rs 680 billion (US$ 10.49 billion) earlier.