Thursday, June 4, 2009
Indian economy better placed than China’s, says Roach
Indian economy better placed than China’s, says Roach
The Financial Express, Corporates & Markets, June 4, 2009, Section II, PVIII
fe Bureau, Mumbai
Stephen S Roach, chairman of Morgan Stanley Asia, expressed his optimism on the prospects for the Indian economy over that of China, saying that India has made a lot of improvement in recent years on the macro developments, especially with an increase in foreign direct investments, higher savings and improvement in infrastructure in the share of India in GDP.
“These improvements reinforce the long-standing accomplishments of India on the micro front—large collection of world-class competitive companies, well educated IT competent workforce, extraordinary entrepreneurs and innovators, well developed capital market, solid financial institutions, rule of law and democracy,” said Roach in a press conference, adding that what has been missing in this interplay between the micro and now the improved macro has been the political impetus to reforms, something it has hobbled your government in the last five years.
“India is a more balanced economy than the rest of export-led Asia,” Roach told reporters in Mumbai on Wednesday. In fact, for the first time, Roach is now more optimistic about prospects for India than China. “China faces major challenges for the first time in 30 years,” Roach said. “It pushed its export-led model too far, leaving it too dependent on the external climate.”
Roach noted that the recent election changes the prospects for reforms going forward and hopes that the new Congress-led government will be more effective in pushing the reforms forward on a number of fronts and will be much less hobbled by the politics of coalition management.
Talking about the growth forecast for the Indian economy, Roach said the growth would remain between 5.5-6.5% for now. Incidentally, Morgan Stanley on May 28 raised India’s growth forecast to 5.8% in the fiscal year to March 31, 2010, from an earlier estimate of 4.4%. The economic growth in the $1.2 trillion economy may turn out to be the real surprise in Asia, Roach said.
“The growth in the Indian economy cannot go beyond 8% in another 2-3 years time,” he said. Roach also noted that disinvestment is important for India to reduce its fiscal deficit.The fiscal deficit of India widened to a seven-year high of 6.2% in the fiscal to March 31 as government borrowed more to fund fiscal stimulus packages.
Economists raise growth forecasts after elections
Economists raise growth forecasts after elections
Business Standard, June 4, 2009, Page 1
John Samuel Raja D & Swapnil Mayekar / New Delhi/ Mumbai
Prospects of a stable government at the Centre have prompted at least six economic forecasters to raise their growth estimates for the current fiscal, citing lower-than-expected political risk after the recent general elections.
With the Congress-led United Progressive Alliance (UPA) coming to power with less than half the number of allies than it had before and the four Left parties out of the picture, the average economists’ forecast for GDP growth in 2009-10 has increased over half a percentage point to 6.35 per cent after the election results were announced. Before the elections, growth was projected at 5.61 per cent, according to data collected from eight economic forecasters. Two forecasts were not revised.
“The political risk has been mitigated with a stable government at the Centre,” said Subir Gokarn, chief economist with Standard & Poor’s (S&P), a rating agency. “A stable government will speed up certain investment decisions so people would be more positive about the future.”
Although S&P — which downgraded India’s sovereign rating outlook on account of the rising fiscal deficit in January 2009 — has not revised its growth estimate, others like Morgan Stanley, Nomura and Kotak Mahindra had all done so.
The prospect of higher political risk from a widely expected hung Parliament had prompted GDP projections for 2009-10 to be revised downwards.
“The election results will have a positive impact,” said Saumitra Chaudhuri, an economist with rating agency ICRA Ltd and member of the Prime Minister’s Economic Advisory Council. He said the negative bias to growth will go out his earlier prediction of 7 per cent, with a range of half a percentage point.
These upward revisions are expected to have an impact on corporate investments, which were the main driver when the Indian economy grew at 9 per cent and above for three years till March 2008, contributing nearly 50 per cent of the expansion in output.
“Given that the UPA no longer needs outside support of the Left, it would now be able to continue with the reform process unhindered,” wrote Citigroup analysts in a recent research note.
The four Left parties had voted with the government in the Lok Sabha the last time and had been instrumental in blocking a significant amount of economic reform.
“While trends in consumption are likely to sustain, given that the government had already implemented fiscal stimulus measures over the past year, the UPA’s clear majority would now spur investment growth as well,” the Citigroup analysis added.
There is now a heavy weight of expectation that the government, free of Left, will push economic reforms in areas like banking, insurance and capital markets that will enable greater capital flow into the economy.
Steel producers to follow global cues; to hike prices to rise
Steel producers to follow global cues; to hike prices to rise
Business Standard, Section II, Page 4, June 4, 2009
Ishita Ayan Dutt / Kolkata
Taking a cue from the trend of price rises in global steel market, domestic producers are likely to hike prices from July.
Jatinder Mehra, chief executive officer, Essar Steel said, “I believe, in July there will be some push in the market. In the Indian market, revival has already begun. Auto, fabrication, capital goods and white goods are doing very well.”
In the flat products segment, hot rolled coil (HRC) prices have not seen a hike since September last year. Last month, long product, cold rolled and galvanised prices were raised.
Sajjan Jindal, vice chairman and managing director, JSW Steel, yesterday hinted at a price increase in July. Jayant Acharya, director (sales and marketing), JSW Steel said, the company was yet to take a call on the zinc-based products for this month. Zinc prices had increased, he pointed out.
Domestic steel prices are presently higher than the international prices. While global HRC prices were at $360-$380 a tonne, domestic prices are at $450 a tonne.
Globally, the market was on an uptrend. The first signs of a recovery in the global steel market were visible with the South African unit of the world’s largest steelmaker, ArcelorMittal, and US-based A K Steel announcing price hikes from July.
ArcelorMittal South Africa has announced a 5-6 per cent increase in flat steel prices, used mostly by the auto and consumer durables sector, and a 5-6 per cent increase in long steel, used by the construction sector. The move from the steel major is the first since September 2008 and reflects the recent global trends.
US-based AK Steel would be increasing sheet prices by $20 a tonne from July 1, an initiative which would lift sentiments among other steel mills in the country where hot rolled coil (HRC) prices are presently hovering about $360-$380 a tonne, down from peak levels of $1,100 a tonne last year.
The price hikes appear to be stemming from the production cut initiated across the world. In South East Asia HRC export prices are higher by $20-$30 a tonne. The increase is not across products and is more selective. For instance, in northern Europe, prices have moved up $85 a tonne in the last six weeks.
Business Standard, Section II, Page 4, June 4, 2009
Ishita Ayan Dutt / Kolkata
Taking a cue from the trend of price rises in global steel market, domestic producers are likely to hike prices from July.
Jatinder Mehra, chief executive officer, Essar Steel said, “I believe, in July there will be some push in the market. In the Indian market, revival has already begun. Auto, fabrication, capital goods and white goods are doing very well.”
In the flat products segment, hot rolled coil (HRC) prices have not seen a hike since September last year. Last month, long product, cold rolled and galvanised prices were raised.
Sajjan Jindal, vice chairman and managing director, JSW Steel, yesterday hinted at a price increase in July. Jayant Acharya, director (sales and marketing), JSW Steel said, the company was yet to take a call on the zinc-based products for this month. Zinc prices had increased, he pointed out.
Domestic steel prices are presently higher than the international prices. While global HRC prices were at $360-$380 a tonne, domestic prices are at $450 a tonne.
Globally, the market was on an uptrend. The first signs of a recovery in the global steel market were visible with the South African unit of the world’s largest steelmaker, ArcelorMittal, and US-based A K Steel announcing price hikes from July.
ArcelorMittal South Africa has announced a 5-6 per cent increase in flat steel prices, used mostly by the auto and consumer durables sector, and a 5-6 per cent increase in long steel, used by the construction sector. The move from the steel major is the first since September 2008 and reflects the recent global trends.
US-based AK Steel would be increasing sheet prices by $20 a tonne from July 1, an initiative which would lift sentiments among other steel mills in the country where hot rolled coil (HRC) prices are presently hovering about $360-$380 a tonne, down from peak levels of $1,100 a tonne last year.
The price hikes appear to be stemming from the production cut initiated across the world. In South East Asia HRC export prices are higher by $20-$30 a tonne. The increase is not across products and is more selective. For instance, in northern Europe, prices have moved up $85 a tonne in the last six weeks.
Modern India exits realty arm
Modern India exits realty arm
The Hindu Business Line, June 4, 2009, Page 2
PTI, Mumbai
Modern India, engaged in real estate and textiles business, today said it has disinvested its entire holding Modern India Realty & Infrastructure Ltd. The company has disinvested its entire stake in the Modern India Realty & Infrastructure Ltd. and thus it is no more a wholly-owned subsidiary, Modern India said in a filing to the BSE.
No major hike in steel prices likely: Naveen Jindal
No major hike in steel prices likely: Naveen Jindal
The Hindu Business Line, June 4, 2009, Page 15
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“Domestic steel demand and consumption is growing at a faster pace than anticipated and since input costs are gradually coming down steel makers should apply a break on hike of steel prices.”
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Our Bureau, New Delhi
Mr Naveen Jindal, Member of Parliament and the Vice-Chairman and Managing Director of Jindal Steel and Power Ltd (JSPL), said on Wednesday that although the industry is not insulated from international steel prices, no major hike within the country was expected in the near future.
Mr Jindal was speaking on the sidelines of a ‘Young Parliamentarians’ meet organised by the Associated Chambers of Commerce and Industry (Assocham).
“I see good demand for steel because bridges, roads, etc. A lot of things have to be built. Domestic steel demand and consumption is growing at a faster pace than anticipated and since input costs are gradually coming down steel makers should apply a break on hike of steel prices,” said Mr Jindal.
Infrastructure needs
He added that the massive infrastructure needs of the country, such as the building of ports and a comprehensive road network, was an important aspect that the upcoming Budget will have to address. “If given a chance, I shall debate on these topics in Parliament and make sure that these concerns are addressed,” he said.
The Lok Sabha MP from Kurukshetra, Harayana, said that power is another sector where the country needs investment. New plants are needed, while alternative sources of power need to be developed, he said.
Dr Swati Piramal, Senior Vice-President, Assocham, said with the support of young MPs, a new Drug Policy should be announced to enable the pharmaceutical industry to manufacture medicines at affordable prices, especially for people below the poverty line. The meeting was attended by MPs Mr Rajagopal Lagadapatti, Mr Kirti Azad, Mr Manish Tewari, Mr Deepender Hooda, among others.
Rising steel prices
However, the Federation of Industries of India (FII) has expressed concern over the rising steel prices, particularly of Hot Rolled (HR) steel, while worldwide prices are falling. According to a statement issued by FII, on May 10, the prices of HR coil were raised by Rs 600 a tonne by Steel Authority of India Ltd and again on June 1 by Rs 750/tonne. The domestic price for the same, as charged by SAIL, is between Rs 28,500 and Rs 29,300 a tonne. The international price, however, is Rs 18,600-Rs 20,800/tonne. “The entire steel consuming industries are astonished at the unreasonable price hike by SAIL,” said the FII statement.
“There is an acute shortage of HR coil in the country which is being created artificially through an informal pricing and distribution cartel of the steel producers for HR products,” said the FII statement.
The Hindu Business Line, June 4, 2009, Page 15
--------------------------------------------------------------------------------
“Domestic steel demand and consumption is growing at a faster pace than anticipated and since input costs are gradually coming down steel makers should apply a break on hike of steel prices.”
--------------------------------------------------------------------------------
Our Bureau, New Delhi
Mr Naveen Jindal, Member of Parliament and the Vice-Chairman and Managing Director of Jindal Steel and Power Ltd (JSPL), said on Wednesday that although the industry is not insulated from international steel prices, no major hike within the country was expected in the near future.
Mr Jindal was speaking on the sidelines of a ‘Young Parliamentarians’ meet organised by the Associated Chambers of Commerce and Industry (Assocham).
“I see good demand for steel because bridges, roads, etc. A lot of things have to be built. Domestic steel demand and consumption is growing at a faster pace than anticipated and since input costs are gradually coming down steel makers should apply a break on hike of steel prices,” said Mr Jindal.
Infrastructure needs
He added that the massive infrastructure needs of the country, such as the building of ports and a comprehensive road network, was an important aspect that the upcoming Budget will have to address. “If given a chance, I shall debate on these topics in Parliament and make sure that these concerns are addressed,” he said.
The Lok Sabha MP from Kurukshetra, Harayana, said that power is another sector where the country needs investment. New plants are needed, while alternative sources of power need to be developed, he said.
Dr Swati Piramal, Senior Vice-President, Assocham, said with the support of young MPs, a new Drug Policy should be announced to enable the pharmaceutical industry to manufacture medicines at affordable prices, especially for people below the poverty line. The meeting was attended by MPs Mr Rajagopal Lagadapatti, Mr Kirti Azad, Mr Manish Tewari, Mr Deepender Hooda, among others.
Rising steel prices
However, the Federation of Industries of India (FII) has expressed concern over the rising steel prices, particularly of Hot Rolled (HR) steel, while worldwide prices are falling. According to a statement issued by FII, on May 10, the prices of HR coil were raised by Rs 600 a tonne by Steel Authority of India Ltd and again on June 1 by Rs 750/tonne. The domestic price for the same, as charged by SAIL, is between Rs 28,500 and Rs 29,300 a tonne. The international price, however, is Rs 18,600-Rs 20,800/tonne. “The entire steel consuming industries are astonished at the unreasonable price hike by SAIL,” said the FII statement.
“There is an acute shortage of HR coil in the country which is being created artificially through an informal pricing and distribution cartel of the steel producers for HR products,” said the FII statement.
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