Current Economic Statistics and Review For the
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Theme
of the week:
All-India Debt and Investment Survey
(AIDIS)
Cost of Debt - Terms of Interest
“The Rate of Interest and Terms of Payment of Interest largely explain the Interest Burden or cost of debt borne by the indebted households”. AIDIS Survey Introduction
All India Debt and Investment Survey (AIDIS) has been conducted by National Sample Survey Organisations (NSSO) decennially to generate basic quantitative information on assets, liabilities and capital expenditure in the household sector of the economy. Cost of debt for a borrower depends upon rate of interest, terms of interest, duration of loans, type of loan and at times the security furnished. Hence, it is intent to deal in this note and the subsequent notes different facets of interest burden or cost of debt such as terms of interest, rate of interest, duration of debt and type of loan and security as well distribution of debt by size of debt. I Terms of Interest - OverviewAll loans are categorized according to terms of interest charged on loans extended by credit agencies. There are four broad such categories: i) interest free, ii) simple interest, iii) compound interest and iv) concessional rate of interest. Obviously, to understand the burden of interest, the actual rate of interest should also be examined along with the terms of interest of loans, since the actual interest amount due from households would differ according to terms of interest payment. These aspects of terms of interest rate and loans outstanding classified by states have been reviewed in this note. The composition of aggregate amount of debt as on 30-6-2002 for rural and urban households classified by terms of interest rate along with those obtained from 1991 and 1981 AIDIS are given in Table 1. It may be seen that the share of debt at concessional rates was the least - a tiny 2 per cent in 2002 for rural households which it was similar 3 per cent for urban households. The similar share of debt at interest free loans was significant in rural areas at 8 per cent and in urban areas at 10 per cent although declined from the respective shares in 1991. The bulk of the outstanding debt was in the form of simple interest and compound interest rates, which accounted for 69 per cent and 11 per cent in 1981 and were 69 and 21 per cent in 2002, respectively, for rural households. The corresponding shares for urban households were 69 per cent and 17 per cent in 2002.
The share of aggregate amount of debt with compound interest rates, which was much higher as on 30.6.1991 as compared to 30.6.1981, remained stable during the decade ending 30.6.2002 for urban households while that of rural households declined marginally. At concession rates of interest, the share of debt, though increased between 1981 and 1991, has fallen back to that of 1981 level in 2002 for both rural and urban households. The percentage share of aggregate debt, both in rural and urban households, at interest free category steadily decreased during the period 1981 to 2002. In the case of simple interest, the share of debt marginally declined, from 69 per cent to 66 per cent between 1981 and 1991 and then increased to 69 per cent in 2002 for rural households. In respect of, urban households, the share of debt with simple interest stood at 69 per cent with a rise of 9 points over that in 1991. 2 Category-wise reviewState-wise
details of households reporting cash loans outstanding under different
terms of loan schemes including estimated number of households for rural
and urban households are given in statements 1 to 13. A brief review of
the results is presented in the following sections.
The
estimated number of households and amount of cash loans by terms or nature
of interest for rural and urban areas, as also at all-India level are
presented in Table 2. Interest free loans by definition get excluded from the ambit of this analysis. However, out of 203.4 million estimated number of households (Statement 1) about 9.4 million households or an impressive 19.1 per cent of the total households, had reported interest free cash loans outstanding as on 30.6.2002. The total cash loans outstanding under this category was estimated at Rs. 16,157 crore or 9.1 per cent of the total amount of cash loans outstanding as on 30.6.2002 (rural + urban areas). It is observed that ‘relatives and friends’ constituted about 80 per cent of the amount of Rs. 16,157 crore. However, their share in total loan outstanding is dwindling over the last two decades. Relatives and friends are the credit agency by definition gives interest free loans as per NSSO 59th round (January-December 2003).
The share of cash debt under concessional loan rates was also low; both in terms of number of households as well the amount outstanding, which was at 2.4 per cent for both urban and rural households together. Concessional loans are usually given by government under different schemes through institutional agencies. Differential rate of interest scheme is one such scheme of government which extends loans for the upliftment of the poorer section of the society at a concessional interest rate of 4 per cent. This scheme is operative from 1972. However, the maximum amount, which can be advanced under this scheme was increased from Rs. 6,500 to Rs. 15,000 from 2007-08. The total number of households who had reported cash loans outstanding under this scheme was 10.5 lakh or 0.5 per cent and the amount outstanding under this scheme as on 30.6.2002 at Rs. 5,077 crores or 4.5 per cent are meagre. (AIDIA- Report No 500 pages 263 and 274) The number of households contracted loan at compounded interest were 8.97 million or 18.3 per cent of total number of households and the corresponding amount outstanding as on 30.6.2002 is Rs. 34,579 crore or 19.6 per cent of the total amount (Table 2). The share of the outstanding debt under simple interest rate is almost the same at about 68 per cent for both rural and urban households (Table 2). However, the number of rural households availed loan under this terms of interest at 26.2 million or 66.9 per cent of all rural households was much higher than number of urban households (6.3 million) in urban areas although they hold a share of 63.7 per cent in terms of number of urban households. In terms of outstanding debt, both rural and urban households accounted for about 69 per cent of this debt under this scheme of interest terms. 3 Nature
of Interest Rates- Credit Agency-wise Table 3 depicts the percentage distribution of cash debt by nature of interest rate and by credit agencies (by broad groups). It can be seen that debt under simple interest scheme accounted for 70 per cent of loans extended by institutional agencies which was received by 67.9 per cent of the households reporting cash loans. However, the credit extended by them under compound rate accounted for 25 per cent of the outstanding loans to about 26 per cent of the estimated debt-reporting households. The institutional credit in the sphere of interest free and concessional rate of interest is very meagre. On the other hand, 67 per cent of the outstanding cash loans of debt reporting households was extended by non-institutional agencies at simple interest which were held by 63 per cent of these households. However, unlike institutional agencies, their activity in the sphere of interest free loan is much higher at 22 per cent of the total cash loans outstanding (Rs. 14,148 crore) shared by 8.6 million (30.5 per cent) of households reporting debt as on 30.6.2002; as the interest free loans were advanced by friends and relatives as already mentioned earlier. Non-institutional agencies, like institutional agencies, extended an amount of Rs. 42,936 crore or 67.0 per cent of the total non-institutional agencies’ loans, under simple rate of interest. However, loans of non-institutional agencies’ at compound interest accounted for only 10.3 per cent (or Rs. 6,594 crore) of a total non-institutional finance of Rs. 64,093 crore as on 30.6.2002.
It can also be seen from the Table 3 that about 88 per cent of interest free loans are extended by all agencies was held by non-institutional agencies as compared to a meagre 12 per cent share extended by institutional agencies. However, at concessional and compound interest rate terms, it is the institutional agencies which advanced about 90 per cent and 81 per cent of respective total cash loans. At simple interest rate, while institutional agencies extended an advance of Rs. 78,961 crore (or 64.8 per cent), the non-institutional agencies share amounted to Rs. 42,936 crore (or 35.2 per cent).
Cost of Debt – CultivatorsCultivator households comprise a majority of rural households. Therefore, an analysis of cost of debt among cultivator households is important. The data showed that the households who contracted debt from institutional agencies with interest free and concessional rates accounted for 1.2 per cent and 4.1 per cent, respectively, of the total cultivator households, in 2002. The respective amounts of debt were Rs. 250 crore (0.5 per cent of total debt) and Rs. 1,199 crore (or 2.4 per cent). However, interest free loans accounted for the second largest share for non-institutional agencies at 17.4 per cent, which are mostly from friends and relatives, as stated earlier. Moreover, institutional agencies lending at compound interest were second largest at 29.2 per cent of their total cash loan outstanding. Cultivator households got major part of their debt (about 70 per cent) from all credit agencies at simple interest rate (Table 4).
In terms of number of households, 10.1 million cultivator households (or 67.1 per cent) have an outstanding cash loans of Rs. 33,865 crore (or 67.8 per cent) as on 30.6.2002 from institutional agencies at simple interest rate while 8.8 million cultivator households are indebted to the tune of Rs. 22,229 crore ( or 70.0 per cent) to non-institutional agencies at simple rate of interest. In other words, 17.5 million cultivator households have an outstanding debt of Rs. 56,052 crore at simple interest rate. 5 Over
view – Region/Statewise
Table 5 gives the distribution of cash loans outstanding at
different terms of interest at all-
However,
households in eastern region with 27.1 per cent of the total loans
outstanding advanced under concessional terms are the biggest
beneficiaries followed by households of western (24.2 per cent) and
southern (24.1 per cent) regions.
It
can be seen from Statements 8 and 9, that in southern region, out of the
total cash loans of Rs. 66,817 crore outstanding as on 30.6.2002, a sum of
Rs. 51,795 crore (or 77.5 per cent) had been advanced under simple
interest, the largest share of distribution of cash loans among all
regions in
The share of
cash loans outstanding between different terms of interest among Gujarat
households in western region also follow the distribution path of Kerala
with 17.3 per cent interest free loan, 5.8 per cent concessional loans and
18.8 per cent compound interest loan.
In
Uttaranchal, households are able to enjoy 17.0 per cent of their total
cash loans outstanding interest free. However, they have to pay interest
at compound rate for 70.1 per cent of their loans outstanding as on
30.6.2002.
A similar
trend i.e. larger share of interest free loans and compound interest rate
loans were also witnessed in Bihar and West Bengal in eastern region,
Highlights of Current Economic Scene AGRICULTURE According to the IVth advance estimates (AE) released by the ministry of agriculture, total foodgrain output in 2006-07 has been higher at 216.1 million tonnes, compared to 211.8 million tonnes projected in IIIrd AE. Among the foodgrains, production of wheat is expected to post the highest increase of 8.0 per cent to 74.9 million tonnes over the output of previous year, followed by pulses (6.3 per cent to 14.2 million tonnes) and rice (1.1 per cent to 92.8 million tonnes). Output of coarse cereals has been pegged at 34.3 million tonnes, marginally higher than 34.1 million tonnes of 205-06 driven by excepted higher production of bajra (12.4 per cent to 8.6 million tonnes) compared to other coarse cereals. As for commercial crops, cotton and sugarcane are expected to witness a record growth of 22.7 per cent and 22.8 per cent, respectively, to touch 22.7 million bales and 345.3 million tonnes in 2006-07. While output of jute and mesta are projected to increase by around 4 per cent to 11.3 million bales, production of oilseeds is expected to diminish by 14.7 per cent to around 24 million tonnes during the same period. However, among the oilseeds, soyabean output is scaled at a new record level of 8.86 million tonnes against the previous year. Reliance
Retail has forayed into the dairy products sector by launching a national
‘pilot’ project of its liquid milk (family milk segment) in Adani
Agri-Logistics Ltd (AALL) has plans to set up a modern foodgrain storage
and handling facilities under exclusive BOO (Build, Own and Operate)
agreement with Food Corporation of India (FCI). The first base depot of it
was started in Moga, The central government has announced concessions to ease the impact of the rupee appreciation on the coir sector. The eligibility of coir and coir products has been enhanced from 1 per cent to 3 per cent on FOB value under the Duty Entitlement Passbook Scheme from April 1, 2007, which would be applicable till March 31, 2008. This improvement would result in coir industry getting additional benefit to the tune of Rs18.2 crore against the current benefit of Rs 6.05 crore. The finance ministry has also provided 2 per cent point subvention of pre-shipment credit up to 180 days and post shipment credit up to 90 days during April to December 2007. Coir mats have been included for the benefit under the Duty Drawback Scheme. The
central government has identified 12 locations for setting up of centres
for handling agri-perishables for exports at an estimated cost of Rs 2,500
crore. The locations include The department of fertiliser (DoF) is considering the proposal of increasing the ad-hoc concession on single super phosphate (SSP) from the present Rs 975 per tonne to over Rs 1,300, in accordance with a study carried out by the Tariff Commission. SSP, which is commonly known as the poor man’s fertiliser, is the only fertiliser in the country where the retail price is determined by the State Governments. The DoF also feels that once the ad-hoc concession is in place there could be an immediate increase of two lakh tonnes. At present, the SSP production capacity is around 70 lakh tonnes, but only 25 lakh tonnes is being produced. Apart from this, a procedural change in the disbursement of SSP is also being considered. In the new disbursement scheme, the department of fertiliser has proposed the marketing of SSP to be done by established players whose capacity is more than one lakh tonnes, so as to take care of the quality concerns which are being raised. The banks have entered into an agreement to provide credit to farmers, corporates and processors against national bulk handling corporation (NBHC) warehouse receipts. NBHC would work as a collateral manager with IDBI Bank and State Bank of Patiala (SBP) for warehouse receipt loans. The stock pledged with the banks would be kept in warehouses owned by NBHC, which would guarantee quality and quantity of the commodity. In case there is a default, NBHC will help the banks to close the loans. InflationThe annual point-to-point inflation rate based on wholesale price index (WPI) remained stationary at 4.27 percent for the week ended July 07,2007. During the comparable week of the earlier year, it was 4.83 per cent.
During the week under review, the WPI rose to 212.6 from 212.5 in the previous weeks’ level (Base: 1993-94=100). The index of ‘primary articles’ group, (weight 22.02 per cent), declined by 0.3 percent to 221.0 from its previous week’s level of 220.6, mainly due to decline in prices of ‘food article like fruits and vegetables, poultry chicken, moong, masur and bajra. However, the increase in prices of jowar, fish marine, condiments and spices,g ram, arhar, wheat and maize off set the decline in other items to keep the food articles decline at 0.9 per cent. Marginal decline is witnessed in the price index of ‘fuel, power, light and lubricants’ group (weight 14.23 per cent) due to lower prices of naptha.
The index of ‘manufactured products’ group rose by 0.2 per cent to 185.3 from 184.9 during the week under review. The higher prices of food products like sunflower oil, ground nut oil, oil cakes, gur, cotton seed oil, rice bran oil and sugar. pushed up the prices of manufactured products. The latest final index of WPI for the week ended May 12, 2007 has been revised upwards; as a result both, the absolute index and the implied inflation rate stood at 212.4 and 5.62 per cent as against their provisional levels of 211.7 and 5.27 per cent, respectively. BankingBuoyed
by a sharp rise in fee and other income, ICICI Bank has reported a 25 per
cent rise in net profit in the first quarter of 2007-08. The bank’s net
profit increased to Rs 775 crore in the first quarter of 2007-08 from Rs
620 crore a year earlier. Indian
Bank has posted a net profit growth of 28.7 per cent at Rs 212 crore in
the first quarter of 2007-08, against Rs 165 crore in the corresponding
period of the previous year. Central
Bank of Financial MarketsCapital
Markets Primary
Market Omnitech
InfoSolutions Limited has
tapped the market between July 19 and 25 by issuing equity shares
aggregating Rs. 3500 lakhs with face value Rs.10 per share, in
a price band of Rs 90-105. Omaxe
Ltd. has tapped the market
between July 17 and 20 by issuing equity shares aggregating 17796520
Equity Shares (Excluding Green Shoe Option of 1750000 Equity Shares)
with face value Rs.10 per share, in
a price band of Rs 265-310. Zylog
Systems Limited has tapped the market between July 20 and 25 by issuing equity
shares aggregating Rs. 36 lakhs with face value Rs.10 per share, in
a price band of Rs 330-350. Secondary
Market Sensex
garners 293 points The
market settled at all time high, as buying momentum continued at higher
level. Strong global markets, fresh buying at higher levels, healthy
inflow from foreign funds, easing fears of interest rate hike, and
anticipation of robust Q1 June 2007 results and triggered a solid rally on
the bourses in the week ended 20 July 2007. The
BSE Sensex gained 292.83 points in the week ended 20 July 2007 to
15,565.55, while the NSE Nifty advanced 61.50 points to 4,566.05. Both the
indices logged gains in 4 out of 5 trading sessions. The
week started on an upbeat note with the BSE Sensex rising 38.50 points to
15,311.22, on Monday 16 July 2007. Shares from the banking, real estate,
and cement sectors advanced, while IT, FMCG and pharma stocks declined. Sensex
lost 21.40 points at 15,289.82, on Tuesday, 17 July 2007. Weakness in
European stocks weighed on the domestic bourses. On
Wednesday, 18 July 2007, the BSE 30-share Sensex gained 11.35 points to
15,301.17. A sharp intra-day fall triggered by profit booking after the
recent rally was reversed by short covering and value buying. Asian and
European markets were subdued. The
Barometer index galloped 248.96 points, to 15,550.13 on Thursday, 19 July
2007 on strong buying in index pivotals. On
Friday, 20 July 2007, the Sensex gained a marginal 15.42 points to
15,565.55, an all time closing high. It also hit an all time high of
15,683.03. Derivatives
The Nifty July 2007 futures settled at a sharp discount of 20.75 points
to 4,545.30, as compared to spot closing. The Nifty July 2007 futures also
hit an all time high of 4,577.90 today
Government
Securities Market Primary
Market RBI
conducted the auction of "7.27 per cent Government Stock 2013"
and "7.95 per cent Government Stock 2032" for the notified
amounts of Rs.6000 crores and Rs.3000 crores respectively. The cut-off
yields for the "7.27 per cent Government Stock 2013" and
"7.95 per cent Government Stock 2032" were 7.5851 per cent and
8.3425 per cent respectively. RBI
conducted the auction of "6.65 per cent Government Stock 2009"
for a notified amount of Rs.5000 crores under MSS. The cut-off yield of
the security was 7.0827 per cent. RBI has announced the sale (re-issue) of
"7.55 per cent Government Stock 2010" for Rs.2000 crores under
the Market Stabilisation Scheme (MSS) on July 25, 2007. The
cut-off yield in 91-day T-Bill auction moved lower to 4.5022 per cent as
against 5.1183 per cent during the previous week. The cut-off yield in
364-day T-Bill auction moved lower to 6.5824 per cent as against the
previous cut-off yield of 7.1663 per cent. Secondary
Market During
the week, the weighted average call rates during the period ranged between
0.24per cent and 0.42 per cent, while weighted average repo rates ranged
between 0.00 per cent and 0.23 per cent and the weighted average CBLO
rates ranged between 0.02 per cent and 0.06 per cent. The average volumes
of Call, Repo, and CBLO segments were Rs.9896.5 crores, Rs.13236.3 crores
and Rs.19249.3 crores respectively. The daily average outstanding amount
in the LAF (reverse repo) operation conducted during the period was Rs.
2999.8 crores. The 1-10 year YTM spreads decreased by 14 bps to 115 bps. Bond
Market Bank
of Maharashtra has tapped the market to mobilise Rs 200 crore by issuing
bonds, offering coupon rate of 10.35
per cent for 15 years. Punjab National Bank has tapped the market to mobilise Rs 500(with green shoe option of Rs 250) crore by issuing perpetual bond , offering coupon rate of 10.40 per cent& 10.90 per cent if Call is not exercised. Foreign
Exchange Market The
rupee closed at Rs.40.33/USD on July 20, 2007 as compared with Rs. 40.47/USD
as on July 13, 2007. The Rupee moved between Rs. 40.33 and Rs.40.40, with
a standard deviation of 3 paise during the week. Similarly during the
fortnight (July 09, 2007 - July 20, 2007), the Rupee moved between
Rs.40.33 and Rs.40.47, with a standard deviation of 4 paise. The Rupee
moved between Rs.40.33 and Rs.41.01 during the last 1 month (June 25, 2007
-July 20, 2007), with a standard deviation of 21 paise. The
six-month forward premia closed at 1.24 per cent (annualized) on July 20,
2007 vis-à-vis 1.91 per cent on July 13, 2007. Commodities
Futures derivatives The
National Multi-Commodity Exchange (NMCE) has launched 43 new contracts and
six new ‘spread series’ for futures, while it has settled the prices
in various commodities of the July 2007 series that expired on Saturday
last. Rubber in the aforesaid series has settled at Rs 7,859 (per
quintal), which was lower than the previous three series, varying from the
Rs 8,194 of June and Rs 8,452 of May to Rs 9,254 of the April series. The
July series in the commodity was launched on March 16, 2007, as it
recorded the highest intra-day traded price of Rs 10,425 on March 24 and
the lowest of Rs 7,301 on July 4, according to a release here. The July
2007 series in pepper, another highly-traded commodity at NMCE, settled at
Rs 14,507 (per quintal), which was higher than the Rs 13,806 of June, but
lower than Rs 14,895 of May and Rs 15,253 of the April series. The July
series in pepper was launched on January 16, 2007. It posted the highest
intra-day traded price of Rs 16,800 on April 12 and the lowest of Rs
12,151 on March 13. The July 2007 series in cardamom settled at Rs 479
(per kg), as against Rs 398.85 of June, Rs 394 of May and Rs 404 of the
April series. The settlement prices are arrived at by averaging out the
spot prices of the particular commodity on five days preceding the expiry
date. Different series are launched on different specified dates of the
month and run for different periods. For instance, pepper is
simultaneously traded in six series, rubber in four, and cardamom in
three. The
Forward Markets Commission (FMC) is likely to allow aggregators to hedge
commodity risks on behalf of farmers. Aggregators (banks, non-governmental
organisations and institutions) will be allowed to collect commodities
from farmers and keep them in possession till the decision for selling is
made. Besides, if farmers want to invest in other commodities which the
aggregators do not possess, they will have the liberty to do so. The
aggregators will act on farmers’ behalf and pass on profits and losses
according to commodities’ performance on the exchanges. Anupam Mishra,
director said that they
considering the proposal of the National Commodity and Derivatives
Exchange (NCDEX) as the regulator’s main objective is to involve maximum
number of farmers in commodities’ trade. About the similarities between
mutual funds and aggregators, Mishra said the former aimed at
profit-making while the latter was likely to play a role of a facilitator.
The mutual funds declare their investment intentions before collecting
fund, while the aggregators will have the liberty to make their investment
decisions according to the market sentiments. If permitted, this would be
the first of its kind of collective participation in commodities trade
before banks, mutual funds and financial institutions are allowed. The
involvement of these institutions is under consideration with the ministry
and likely to be cleared with the amendment of FC(R)A in the forthcoming
session of the Parliament. National
Bulk Handling Corporation (NBHC) will work as a collateral manager with
IDBI Bank and State Bank of Patiala (SBP) for warehouse receipt loans. The
banks have entered into an agreement to provide credit to farmers,
corporates and processors against NBHC warehouse receipts. The stock
pledged with the banks will be kept in warehouses owned by NBHC which will
guarantee quality and quantity of the commodity. Warehouse receipts are
not negotiable as Warehouse (Regulations and Development) Bill, 2005, is
pending in Parliament. Negotiability means goods pass to the holder of the
receipt in the event of any default or defect in title. In case there is a
default, NBHC will help the banks to close the loan, said Mr. Anil
Choudhary, MD and CEO of NBHC. Futures
trading in the commodity exchanges reached a whopping Rs 8,97,816 crore
till June-end in the current financial year on the back of more
participation in the non-agricultural commodities counters. Since the
government has put a restriction on new agricultural commodities till it
decides the issue of impact of futures trading on prices, the business has
shifted to non-farm .The value of trade during April-June period of this
financial year is Rs 8,97,816.52 crore. According to FMC, the turnover of
three national-level and 20 regional exchanges during the second fortnight
of last month declined by 12.62 per cent to Rs 1,31,754.09 crore from Rs
1,50,796.26 crore in June 1-15 this year. Trading at the leading commodity
exchange, MCX, was hit in the second fortnight as its turnover dipped by
about 12 per cent to Rs 97,897.36 crore from over Rs 1,00,000 crore in the
previous fortnight. At MCX, copper trading recorded a record Rs 22,622.61
crore, surpassing gold which stood at Rs 20,397.97 crore in the June 16-30
period. Other contracts that attracted major business were silver, crude
oil, zinc, nickel, natural gas and aluminium. The turnover at leading agri-commodity
exchange NCDEX too slid to Rs 28,627 crore from Rs 33,501 crore in the
fortnightly review period. However, the trading at Ahmedabad-based
national exchange, NMCE, improved in the second fortnight of June to Rs
671 crore from Rs 658 crore in the previous fortnight. Interestingly, the
turnover of some of the regional commodity exchanges were higher than the
value of trade at NMCE during June 16-30.The turnover of 20 regional
exchanges recorded at Rs 4,558.56 crore led by Indore-based National Board
of Trade with Rs 2,894.08 crore and followed by Hapur’s Chamber of
Commerce which registered a business of Rs 876.52 crore in the fortnight. Even
as the monsoon slips into a weak phase and is likely to remain so for at
least 4 to 5 days more, the crop sowing operations continue to be in full
swing throughout the country. The cumulative seasonal monsoon rainfall in
the entire country, which remained deficient till the third week of June,
turned surplus later, providing adequate soil moisture to facilitate crop
seeding and germination. However, flash floods caused by sustained heavy
downpours in several pockets in the beginning of July are said to have
damaged freshly planted crops, necessitating re-sowing at some places.
However, the overall kharif crop outlook remains bullish on good showing
by the monsoon so far. The backlog in the planting of paddy and some other
crops, created due to low rainfall in June, has, by and large, been
cleared. Barring pulses, which have till now been sown on about 16 per
cent less area than last year, the sowing of all other major crops is
ahead of their last year’s corresponding positions. According to the
National Centre for Medium Range Weather Forecasting NCMRWF), the axis of
the monsoon has retreated to the foot hills of the Himalayas, pushing it
into the weak phase which may last for the next 4 to 5 days. As a result,
the north-west, central As
many as 69 of these 78 dams are already filled up to over 80 per cent of
their normal levels. The politically sensitive Mettur dam in the Cauvery
river basin is likely to be filled to the brim in the next day or so,
facilitating timely and adequate release of water for the Samba season
crops in the Cauvery delta. Only 3 dams are reporting below 30 per cent of
the normal storage. These are Shetrung in Corporate SectorAccording
to Dun & Bradstreet, the total number of merger and acquisition
(M&A) deals in India in the first 5 months of 2007 are worth $46.8
billion compared with $20.3 billion in the whole of 2006 with telecom,
pharma, healthcare, energy and IT/ITeS being the primary contributing
sectors. Tata
Tea has reported a decline of 3.5 per cent in its net profit to Rs 43
crore in the quarter ended June, 2007 as against Rs 44.56 crore earned in
the corresponding quarter of the previous financial year. In
its biggest acquisition deal so far, Reliance Communications (Rcom) had
bought Dubai-based
realty major Emaar is setting up a 100 per cent subsidiary in Realty
major DLF has bagged Rs 6,000 crore design, development and operation
project for an international convention centre in A
consortium led by the country’s largest engineering company L&T has
bagged orders of Rs 1,070 crore from Tata Steel, for supply and
installation of sinter plant and other packages. TelecomBharti
group company has acquired 4.99 per cent direct holding in Bharti Airtel,
the largest private sector telecom company from Vodafone. With this, the
Bharti group companies had enhanced their voting interest in Bharti Airtel
to over 50 per cent. Vodafone, which bought 67 per cent stake in
Hutchison-Essar recently, had to reduce its stake in Bharti Airtel from 10
per cent to conform to telecom guidelines. The Bharti group companies will
now hold 50 per cent in Bharti Airtel, while Singtel will control over 31
per cent, Vodafone 5 per cent and Temasek 4.99 per cent. The public and
other institutions hold the rest. According
to a study by global research and analysis firm MTNL
has received a refund of Rs 1,461.68 crore from the income tax department,
following the settlement of decade old litigation. Further, the
state-owned telecom major is also expected to get another Rs 2,000 crore
as refund from the I-T department. The refund is pursuant to an order from
the Income Tax Appellate Tribunal (ITAT), which ruled in favour of
MTNL’s arguments that its licence fee should be provided a discount
under the Section 80IA of the IT-Act. MTNL said that the ITAT has accepted
its view and granted it a deduction. Information Technology Bangalore-based
Lake Systems (LSPL), a healthcare BPO major, has opened its first unit in
Nashik.
*These statistics and the accompanying review are a product arising from the work undertaken under the joint ICICI research centre.org-EPWRF Data Base Project. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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