Real Estate Intelligence Service, Friday, October 23, 2009

Planning Commission sees growth rebounding to 8% next fiscal

Planning Commission sees growth rebounding to 8% next fiscal
The Financial Express, October 23, 2009, Page 1

fe Bureaus, New Delhi

The Planning Commission expects the economy to stage a full recovery by next fiscal and register a growth of 8%. It also expects last year’s final GDP number to be a tad higher than the revised estimate of 6.7%.

“GDP growth in the last fiscal will be revised upwards to 6.9%,” Planning Commission member Saumitra Chaudhuri said on Thursday. The upward revision is likely because of a better-than-estimated performance by the manufacturing sector, he explained.

The Planning Commission paints a rather bright picture for the next couple of years, “In 2010-11, we expect GDP could register a growth of close to 8%, while in 2011-12 it could grow at 8-8.5%,” Chaudhuri said at the India Forecasting Forum.

The forward-looking estimates are far more optimistic than the panel’s projections for the current fiscal. The Planning Commission expects GDP to grow at 6.3% in 2009-10, a shade lower than the 6.5% projected by the Prime Minister’s Economic Advisory Council (EAC).

“If the monsoon had been normal, we would have got 7%-plus GDP growth this year. The monsoon has essentially taken half a percentage point off growth,” explained Chaudhuri, who is also a member of the EAC.

“We expect that if overall global conditions are unfavourable, the Indian economy could grow at 7%. If, on the other hand, global conditions are favourable, growth could be close to 9%.” The Plan panel hopes that private corporate investment will pick up in 2010-11.

Significantly, Chaudhuri played down the role of disinvestment proceeds in bridging the fiscal deficit. “Disinvestment can only play a small role in the dynamics of the fiscal deficit. You can’t go for asset sales to improve your balance sheet,” he postulated, adding, “The basic correction in the fiscal deficit has to come from revenue and expenditure management, and not from disinvestment.”

Inflation up at 1.21%, rates may be left unchanged

Inflation up at 1.21%, rates may be left unchanged
The Financial Express, October 23, 2009, Page 2

fe Bureaus, New Delhi

Inflation rose to a higher-than-expected 1.21% for the week ended October 10, compared to 0.92% in the previous week, but policy advisors and analysts expect the Reserve Bank of India (RBI) to leave rates unchanged at its policy review next week. The RBI will announce its mid-term review of the monetary policy on Tuesday.

Analysts expect no change in interest rates at the policy review, although some expect the RBI to take steps to mop up excess liquidity in the financial system. “We maintain that the RBI will remain neutral as risks are still tilted towards growth vulnerability rather than inflation,” said Reliance Equities chief economist Atsi Sheth. Chief statistician Pronab Sen said RBI is unlikely to signal hike in interest rates in its forthcoming monetary review next week despite inflationary reassures. He added that the effect of drought has already been factored into prices so there would not be further acceleration in food prices.

CRR is the slice of deposits banks need to park with the RBI. The RBI left its key policy rate unchanged at its last quarterly review in April after cutting it by 425 basis points to 4.75% since October 2008 to stimulate a slowing economy.Axis Bank economist Saugata Bhattacharya said inflation could touch 7% by March 2010 but expected a status from RBI at the policy review.

Inflation rose mainly due to food and some manufactured items turning expensive. The EAC has said managing food prices will be the government’s biggest challenge in the short run. Raw food articles were expensive by 13% because of a rise in prices of potatoes by 104%, onions by 35%, milk by 10%, pulses by 23% and rice by 13%. Processed food items rose by 16% on a yearly basis as sugar turned dearer by 45%.

The yield on the benchmark 10-year government bond increased by 1 basis point to 7.37% after the release of the inflation data. It had closed at 7.35% on Wednesday. The Prime Minister’s Economic Advisory Council on Wednesday said inflation could touch 6% by the end of the fiscal, driven mainly by rising food inflation. However, EAC chairman C Rangarajan said there was no need to change the current easy monetary stance unless inflationary pressures rise.

RBI governor D Subbarao has said there is an agreement that the country needs to exit its easy monetary stance, but its timing is crucial. The EAC said RBI will watch growth prospects and inflationary pressures while deciding the monetary policy

Industrial output has risen at double digit rate of 10.4% in August this year, after a gap of 22 months. The EAC projects it to expand at 8.2% this fiscal. This would require a double digit growth in the remaining seven months. The index of industrial production grew at 5.8% in the April-August period.

“The direction for primary articles is on a rise. We need to look at the demand side pressures contributing to inflation. Overall, inflation expectations would remain elevated. RBI may sound more hawkish this time,” Yes Bank chief economist Shubhada Rao said.

Inflation rise may trigger RBI rate hike: HDFC

Inflation rise may trigger RBI rate hike: HDFC
The Financial Express, October 23, 2009, Page 13

Agencies, Mumbai

The Reserve Bank of India is likely to wait for a further rise in inflation before it raises its benchmark lending and borrowing rates around December or January, HDFC Bank said on Thursday.

The private sector lender, however, expects RBI to hold key rates in its monetary policy review due next week.

"Our bet is that the RBI will wait until December-January period when inflation actually spikes up before changing policy rates. However, we continue to believe that the policy will maintain status quo (on Oct 27)," HDFC Bank Chief Economist Abheek Barua said in a note.

He said it was unlikely for the RBI to embark on an "aggressive rate hike cycle", even if it were to move rates upward.

"If the central bank is indeed looking for reasons to delay its exit from its super-accommodative monetary stance, the recent inflation prints certainly gives it one," he said.

India's wholesale price index (WPI) inflation rose to 1.21 per cent for the week ended October 10 from 0.92 per cent in the previous week. HDFC Bank expects WPI inflation to moderate in the second half of FY10.

Barua said a robust industrial production data for August at 10.4 per cent has raised the probability of a rate hike in the October 27 policy.

RBI unlikely to signal hike in rates: Pronab Sen

RBI unlikely to signal hike in rates: Pronab Sen
The Economic Times, October 23, 2009, Page 10

PTI & Our Bureau NEW DELHI / HYDERABAD

CHIEF Statistician Pronab Sen on Thursday said that the Reserve Bank is unlikely to signal hike in interest rates in its forthcoming monetary review next week despite inflationary pressures. When asked whether the RBI would review policy rates in view of inflationary pressures, he replied in the negative.

The RBI would announce its quarterly policy on October 27.

Inflation is rising mainly due to base effect, Sen said at a function organised by think-tank Economist Intelligence Unit (EIU). He added that the effect of drought has already been factored into prices so there would not be further acceleration in food prices, though inflation is likely to remain high in the coming months. “I don’t think the rate of increase (of food prices) is going to accelerate...(though) levels will remain high,” he said.

Inflation rose to 1.21% for the week ended October 10 as prices of major food items firmed up further. The wholesale price-based inflation stood at 0.92% in the previous week. Sen further said that there is no evidence of inflationary pressures on non-agricultural items.

Meanwhile, in Hyderabad, State Bank of India, the country’s largest bank, chairman O P Bhatt said interest rates will continue to be stable even if credit-off take picks up in the second half of the current fiscal. “I do not see any hardening of interest rates even if credit off-take picks up. Neither do I see any further softening of interest rates which have already bottomedout,” he said on the sidelines of a summit.

According to him, deposit accretion is growing at faster clip than what the RBI had expected. Even today, banks are parking surplus of over Rs 1 lakh crore with the central under the reverse-repo facility and I do not think interest rates would go up,” he said.

At present, CRR stands at 5%, while the repo rate (the rate at which banks borrow from RBI) is at 4.75% and reverse repo (the rate at which RBI borrows money from banks) stands at 3.25%.

Credit growth down 10%

Credit growth down 10%
The Financial Express, October 23, 2009, Page 13

fe Bureaus, Mumbai

The recovery of Indian economy may be more than expected but the credit offtake situation is heading towards bad to worse with every passsing fornight. The loan growth in the banking industry has dipped to 10.75% for the year ending October 9, 2009, as against 12.62% for year ending 25 September 2009, showed the data released by the Reserve Bank of India (RBI), on Thursday.

However in absolute numbers , the bank loans have shown an uptick by Rs 17,160 crore in the last two weeks, for the fortnight ending 9 October.

At the same time, deposit growth has stayed flat at 19.98% during the year ending 9 October as against 19.79% for the year ending 25 September 2009. While credit demand is subdued, bankers believe the tide will turn. “We are seeing some demand for long term funds and companies are also thinking of raising funds from domestic sources, so we think credit growth is picking up. Retail demand has also started picking up a little, however, nothing spectacular on that front,” said a banker.

The RBI has projected aggregate deposits and adjusted non-food credit of commercial banks to grow by 19% and 20% respectively.

Credit offtake likely to rise in second half of this fiscal: Bhatt

Credit offtake likely to rise in second half of this fiscal: Bhatt
The Financial Express, October 23, 2009, Page 13

fe Bureaus, Hyderabad

The credit offtake in banks is likely to gather momentum during the second half of the current fiscal year. It will be much better than what the banking sector witnessed during the first six months of this year, said OP Bhatt, chairman, State Bank of India (SBI).

Speaking on the sidelines of a round table conference organised by Indian School of Business (ISB) in Hyderabad he said, “The retail sector in the country continues to be robust in the home loan and auto loan segments. However, the aggregate growth has been subdued. Over the past couple of months, we have seen companies hitting the market with their IPOs to part fund their capex plans. The other half has to obviously come from the banking sector. So, I personally feel that the credit offtake should pick up in the second half of the year.”

During the turbulent times, what the industry has seen is better management of working capital among corporates and more productivity among employees, he said.

He said, “I do not see any hardening or softening of interest rates in the near future. The inflation that we see today is not because of liquidity in the market place. Bulk of inflation is because of the food and food-related items,” he said. The excess liquidity that is there in the market has ensured that the banks keep their interest rates lower. And this has infact contained the cost of doing business to a great extent, he added.

On SBI’s acquisition plans, he said, “We are looking at acquisitions. But it is not our priority. In the current environment, we keep getting offers for acquisitions and we keep evaluating them. Acquisition is a good education for us and may be we will get something interesting.” Elaborating on the issue of consolidation in the banking sector, Bhatt said, the exercise has been thought about for the last five years. But apart from discussions on the pros and corns, nothing much has happened except for small mergers. “Last year, State Bank of Saurashtra got merged with SBI and this year we have clearance for merging State Bank of Indore. The merger exercise has kicked off a healthy debate on consolidation. In the process, some valid issues have been raised as to whether there is any risk to be a large bank and whether our banks are large enough to handle the issues related to consolidation say in terms of manageability, deliveries to the economic system and corporates,” he said. Commenting on the RBI committee’s suggestion to replace the benchmark prime lending rate (BPLR) system with a base rate mechanism, Bhatt said that it is a step in the right direction. “We have a plethora of PLRs and having a base rate in place of them would improve the transparency levels in the sector considerably,” he added.

ECB, FCCB approvals up 39%

ECB, FCCB approvals up 39%
The Financial Express, October 23, 2009, Page 13

fe Bureaus, Mumbai

The total approvals received by India Inc to raise capital through external commercial borrowings (ECBs) and foreign currency convertible bonds (FCCBs) rose 39% to $1.5 billion in September, up from $1.08 billion in August 2009, according to a data released by the Reserve Bank of India (RBI) on ECBs and FCCBs, on Thursday.

However, the approvals received by Indian corporates to raise funds in

September 2009 are significantly lower than $2.83 billion recorded in the corresponding period last year.

Indian corporates had received an approval to raise funds through the ECB and FCCB route worth $2.01 billion in July 2009 and $1.9 billion and $494 million June and May 2009, respectively.

Companies can raise $331.9 million through the automatic route and $1.17 billion through the approval route.

In September 2009, Indian Railway Finance Corporation has got an approval to raise $450 million for the purpose of rupee expenditure for a maturity of 5 years, followed by Tata Steel at $384 million for modernisation with a maturity period of 13 years and 2 months.

Experts noted that there is still sometime for the global markets to bounce back to normalcy. “There are a lot of projects, particularly in the infrastructure sector that are kept on hold, which will begin only after maybe six months from now, once liquidity starts pouring into global markets,” said a banking analyst.

DR Dogra, deputy managing director with Care Ratings said with interest rates expected to shoot up in the near future, owing to a spike in inflationary expectations and a high borrowing programme announced by the government, a lot of Indian companies will look at the option of going abroad to raise funds ar cheaper rates.

“Domestic banks are not lending to the corporates in a big way and credit growth is subdued for now. However, in the medium or long term, once the credit growth begins to rise, we will see interest rates heading northwards,” Dogra said. “With interest rates in the global markets still remaining on the lower side, we will see more and more Indian banks and coporates taking the ECB route, he added.

Corporate space: It is time to bounce back

Corporate space: It is time to bounce back
The Economic Times, October 23, 2009, Page 19

Thanks to improving economic sentiments and rising confidence of the corporate sector, the commercial property segment is in the recovery mode

Sanjeev Sinha

Call it the domino effect - after residential property market got into a recovery mode, the nation's commercial property segment has also started showing signs of revival, driven by a spurt in office space and retail sectors. Neeraj Bansal, associate director (advisory services) at KPMG, says, "Commercial real estate transactions, considered a key indicator of economic activity, are now showing some signs of movement in the real estate sector since the end of the 2nd quarter. The confidence and sentiment, relatively low in the first quarter of 2009, has improved after the formation of a new government, thereby contributing to the movement in the commercial sector."

Among positive signs, lease rentals both in peripheral areas as well as the central business district (CBD), are showing early signs of settling down and 'conversions' have begun to happen. There has also been a rise in demand for less costly premises in the sub-markets and landlords have been forced to increase incentives to draw tenants in the past few months. But more than anything else, the revival this time is being witnessed largely in the office space and retail sectors.

A recent Cushman & Wakefield study says the demand for corporate office space in Q2 of 2009 (April-June) registered a growth in excess of 65% over the previous quarter to settle at 5.66 million sq ft. And, the increase in demand was due to factors like improving economic sentiments and rising confidence of the corporate sector. While Bangalore saw the highest demand of about 1.29 million sq ft, the other significant rise was noted in Mumbai where demand rose by 191%. NCR, on the other hand, saw a rise in demand by 43% over the last quarter.

During the slowdown period, companies with expansion plans had stayed on the sidelines anticipating bottoming out of the market. The lack of transactions was due to the general negative sentiment in the market, the cut on global-IT spend for companies and the delayed decision making process. During this period, companies adopted various strategies like renegotiation of contracts along with rationalization of their current space layout, resulting in higher efficiency.

"Q1 of 2009, however, witnessed a revival in demand with companies closing out deals due to good rates resulting from the broader market being close to bottom. Q2 of 2009 again maintained the absorption levels of Q1 of 2009, primarily due to companies getting corrected rates in various micro markets," says Bansal.

The beginning of the third quarter has seen a further rise in demand for office space in the small-to-medium segments. Moreover, buildings that were launched in the last 18-20 months are now moving closer to their 'completion stages', which would again foster some movement in the commercial office space. "However, with the trend being for organizations demanding for office space more from a relocation and consolidation perspective in the 2nd quarter, the trend now seems to be changing to organizations going in for an expansion - deals happening for office spaces in the range of 15,000 sq ft to 50,000 sq ft are now shifting to the 50,000 sq ft plus category going to as large as 150,000 sq ft. This, in turn, would imply creation of job opportunities and subsequently demand for residential space," says Bansal. Apart from office space, a lot of action is also being seen on the retail front, which is expected to contribute significantly to the revival of the nation's commercial property segment. According to a report by Colliers International, office rentals dropped 10-40% between Q1 of 2008 and Q1 of 2009 in Mumbai, Delhi, Noida, Chennai and Bangalore as demand shrunk. This has renewed retail investors' interest in commercial property once again.

A report by Images Retail estimates the number of operational malls to grow more than twofold, to cross 412, with 205 million sq ft by 2010, and a further 715 malls to be added by 2015, with major retail developments in Tier-II and Tier-III cities in India. A recent study jointly undertaken by KPMG and Assocham has also projected that about 315 hypermarkets are likely to come up in Tier-I and Tier-II cities by 2011.

Confirming such developments, Gaurav Marya, president, Franchise India Holdings Ltd, Asia's leading integrated franchise solution company, says, "Mall developers across the country firmly believe in the retail story and are now looking at taking the mall culture to smaller cities to offer a perfect organized retail experience." According to Marya, growth in the nation's Rs 45,000-crore organized retail industry has revived by 10-15% in the first quarter of 2009-10 after slowing down to 5% in the fourth quarter of 2008-09. "Indian retail growth has revived on account of real estate corrections in major metros. Malls are, therefore, going to be required to feed the consumption, by way of convenience. And the mall story, thus, is here to stay," he adds.

Another noteworthy development being that domestic property focused funds - which earlier targeted residential projects - are also looking at commercial properties now. For instance, Red Fort Capital Advisors Pvt Ltd has invested Rs 400 crore in three commercial properties in New Delhi and Mumbai and is looking for more. Similarly, high net worth individuals (HNIs) are putting money mainly into office and retail spaces. This is largely because during the economic crisis, commercial realty became the worst hit segment in the sector and lease rental and property rates fell by 30-40% in the metros and bigger cities. The lower prices, in turn, have triggered a path towards revival in recent months.

FOCAL POINT

During slowdown period, companies with expansion plans had stayed on the sidelines anticipating bottoming out of the market

The trend now seems to be changing as organizations are going in for an expansion. This, in turn, would imply creation of more job opportunities and increase in the demand for residential space.

Rajasthan rolls out new urban housing policy

Rajasthan rolls out new urban housing policy
The Economic Times, October 23, 2009, Page 27

Our Bureau JAIPUR

THE Rajasthan government has rolled out new urban housing policy, which promises 1.25 lakh dwellings over next five years for economically backward section.

As per the policy, the state government would rope in private developers under the public-private partnership PPP model for developing low cost housing with Awas Vikas Limited as the nodal agency. The state urban development and housing minister Shanti Kumar Dhariwal said that the policy would have five models.

“Apart from government bodies like Rajasthan Housing Board (RHB), Jaipur Development Authority (JDA) and local bodies, private developers will also play an important role in providing affordable accommodation.

Out of five models, four involve active participation of private developers while the fifth model is meant for government-run urban agencies like RHB, JDA and municipalities,” he said.

The new housing policy is an offshoot of estimation by Planning Commission, which indicated that the shortage of housing units in the state would go up to 17 lakh in 2021 from 10.70 lakh in 2007.

Under the policy, the state government has made it mandatory for RHB to construct 50% of the total dwellings for Economically Weaker Section (EWS) and Lower Income Group (LIG). Similarly, JDA and other Urban Improvement Trusts will have to reserve 25% of land in any residential scheme for economically weaker section. The private developers too will have to keep aside 15% of the total constructed units or 5% of the total project area for EWS and LIG in any residential township or Group Housing Schemes.

Apart from providing low cost accommodation to LIG and EWS, the state government will also allot free accommodations to slum dwellers.

“Under this model, the state government will invite global tender and the successful bidder would have to develop residential units in the slum areas. The developers will have to hand over the houses to local bodies for the free allotment of houses to the slum dwellers. The developers, in return will get the remaining land as per the prescribed formula for commercial use with 1:4 Floor Area Ratio as against the normal 1:1.8 FAR.

Low-cost housing is likely to provide a great opportunity for battered real estate developers in the form of public-private partnership (PPP). According to a recent report by industry body Assocham PPP model is the most viable business model for such projects. “The model will help the cash-strapped developers, who are finding it difficult to fund their projects on a standalone basis,” the study says.

Credit growth at a 12-year low of 10.75%

Credit growth at a 12-year low of 10.75%
Business Standard, October 23, 2009, Section II, Page 3

BS Reporter / Mumbai

Low demand for loans pushed credit growth to a 12-year low of 10.75 per cent during the year up to October 9.

The previous low of 9.78 per cent was during the fortnight ended November 11, 1997.

According to the latest fortnightly data released by the Reserve Bank of India (RBI) this evening, during the fortnight ended October 9, 2009, bank credit grew Rs 17,160 crore. Bankers said a part of the increase was during the last four days of September, when banks tried to meet their second-quarter targets for sanctioning and disbursing loans.

In contrast, after the credit crisis intensified in September last year, banks lent Rs 64,937 crore during the fortnight ended October 9, 2008. At the end of October 9, 2009, outstanding bank credit was estimated at Rs 28,90,315.74 crore, as against Rs 28,73,155 crore in the previous fortnight.

The present level of credit growth is nearly half the RBI’s projection of 20 per cent for the year ending March 2010. The central bank, which is due to present the second quarter review of the monetary policy on Tuesday, is expected to revisit the projections in the wake of the low demand for funds from the corporate sector. During the pre-policy meeting, bankers had told RBI that it would be difficult to clock a 20 per cent credit growth.

Bankers said that with companies raising equity capital to deal with the high leverage levels, the demand for loans had dropped. In addition, few companies were planning expansions as they had surplus capacity to deal with the present level of demand.

What're the builders so worried about?

What're the builders so worried about?
Business Standard, October 23, 2009, Page 9

Indeed, it's a shame that there needs to be a law so that a home buyer knows how much space he's actually getting in terms of carpet area

Shobhana Subramanian / Mumbai

It’s a pity that home buyers in this country have got such a raw deal all these years while developers have been almost a law unto themselves. Finally, the ministry of housing is trying to help protect consumers and keep a check on the construction of residential property with the proposed Model Act for Real Estate (Regulation of Development). Of course, developers are upset that they will now be made far more accountable, but the government owes it to ordinary, middle class citizens of this country not to drag its feet on this piece of legislation. And since the Act has to be adopted by states, the Centre needs to incentivise state governments to enforce the new rules. Otherwise, home buyers in this country will continue to be at the receiving end. If developers are playing by the rules, then what are they so worried about? After all, there is an appellate tribunal that’s been thought of and with the civil courts out of the picture, decisions can be speeded up; indeed the tribunal is expected to sort out disputes in three months.

Indeed, it’s a shame that there needs to be a law so that a home buyer knows how much space he’s actually getting in terms of carpet area and doesn’t discover after he’s moved in that the space is smaller than he’d thought. Moreover, half the time a buyer doesn’t know what exactly he’s being charged for his apartment and how much he’s paying for the common area and other amenities. Of course, he almost never gets possession on time because very often money collected from customers for a specific housing project is diverted either to buy land or to some other venture. That should change because the draft Model Act proposes that money raised for a specific project be kept aside in some kind of an escrow account, which would be audited by a chartered accountant. That’s pretty much the way it works in China and in other parts of the world where payments have to be utilised for a specific project.

Also, Chinese developers can pre-sell a residential property only when a third or two-thirds of the construction is complete, depending on which province they’re in. It’s a far easier world out here where builders are free to pre-sell property even before they’ve started digging or got necessary clearances. The draft rules propose that developers sign a sales agreement with buyers before they start pocketing any money. If the project is not completed on time, the developer must repay the customer’s advances with interest and, in addition, fork out a penalty. Developers may have a point in that the time line for completing a project should be decided by them and not fixed by the authorities, as is being contemplated. After all, what’s important is that customers know upfront when the project will be completed. It’s also true that in the past, projects may have been delayed because of the numerous approvals and clearances needed and so it hasn’t always been the developers’ fault. But this can’t be an excuse any longer because the draft rules suggest that any project should be marketed only after all approvals are in place. Should the developer fail to put up the property in time, the regulator could recommend that the local land authority develop the remaining portion. If buyers are able to move into their homes within the promised time, it should put an end to the practice of developers charging any kind of premium for a completed project. Today, with developers desperate to grow land banks and in no hurry to start any construction, land lies vacant. Compared to their Indian counterparts, Chinese developers hold relatively smaller land banks; brokerage CLSA estimates it would be sufficient to meet growth targets over a four-to-ten-year period in India, but developers are estimated to be holding on to land banks for anywhere between eight-fifteen years. So, it’s unbelievable that developers are complaining about a 5 per cent bank guarantee that they have to provide on the estimated cost of the ‘development works’. Let them not lose their sleep over the extra cost, let them pass that on to the buyers. Even the smallest home buyer will not mind paying that extra bit because it will save him a whole lot of time and money that he otherwise loses, paying interest on a home loan given that he almost never gets possession of his flat on time.

Centre to add 700 km of highways annually

Centre to add 700 km of highways annually
The Hindu Business Line, October 23, 2009, Page 15

Our Bureau, Kolkata, Oct. 22

The Union Government proposes to lay 700 km of new highways every year for the next few years to fill the infrastructure gap and to improve connectivity, according to Mr Kamal Nath, Union Minister for Roads, Transport and Highways.

Addressing India Invest 2009, a conference organised by the Indian Chamber of Commerce in Singapore on Wednesday, Mr Nath said roads could add up to 1.5 to two per cent of GDP.

India and Singapore, the Minister felt, would emerge as the key players in the economic integration among Asean countries and the first economic agreement between the two countries was already yielding results as evident from the bilateral trade figure of $19 billion, which was set to rise further in the near future.

Mr D.D. Lapang, Chief Minister of Meghalaya, expressed the view that India’s North-Eastern region and Singapore could contribute significantly to the further growth of bilateral trade between India and Singapore in conformity with India’s Look East Policy which has gained momentum after the signing of the India-Asean FTA. He urged investors in Singapore to grab the opportunities available in Meghalaya in areas such as infrastructure, tourism, agro and food processing.

Mr S. Iswaran, Senior Minister of State, Ministry of Trade and Industry, Singapore; Mr Sunny Varghese, Chairman, IE Singapore; and Mr Vijay Iyenger, Chairman, SICCI, spoke about how to take forward the growing economic relations. The Indian Chamber of Commerce is holding a similar conference in Jakarta today (Thursday).