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Don’t mine your own business
The Vedanta group, known for its multinational assets in metals and mines, suffered
a serious setback last week when its application for mining bauxites in Orissa’s Niyamgiri
hills was scrapped by a government panel. However, the government's refusal
to accord environment clearance to Vedanta's proposed US$ 1.7 billion aluminum
project is being viewed as a major victory for the green lobby.
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My way or highway
Recent initiatives taken by the FM to resolve
regulatory disputes have a bearing of the government impeding the autonomy of various regulatory authorities. While Mukherjee, being a seasoned politician that he is, has so far denied any intention on the ministry’s part to intervene in the policymaking process, the recent missives coming out from the North Block that houses the finance ministry indicate otherwise.
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Winner has to take it all
The complete overhaul of the takeover code would be in line with international
practice as far as acquisition is concerned. Currently, the threshold limit for
an open offer globally is around 30 per cent, with the exception of the UK where it is
kept at 35 per cent and Hong Kong at 33 per cent. There are sceptics who fear that
India is not ready for such high level of threshold.
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Of cold chains & cold shoulder
Agriculture supply chain is quite fragmented in India. Intermediation cost between
the farmers and consumers is too high. Local commission agents, wholesalers and
retail vendors together add up to 50-60 per cent to the cost to the final product.
Here, the intermediaries at wholesale and retail markets account for maximum cost.
Then, lack of storage facilities is hampering the transportation and availability of perishable
commodities.
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Kicks for Cash
In India, FIFA football world cup has already notched up a viewership of nearly 20 million during the first two days. 110 million viewers will be glued to the football matches and the marketers are already cashing on the frenzy.
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Fuel for thought
for the OMCs, it is time to rejoice or, perhaps, heave a sigh of relief. With
the revised pricing norms, the gross under-recoveries, which result from selling petroleum
products below the required selling price, will be compensated adequately. Under-recoveries of OMCs were at Rs 460 billion (US$ 9.5 billion) in 2009-10.
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To market, to market
Indians prefer to invest most of
their savings in bank deposits and financial-saving products. Therefore, there are
doubts whether the depth of the Indian markets is adequate to absorb the flood of
issues that will hit the market post notification. It is hardly surprising that the Finance
Secretary, Ashok Chawla, said, “If there is any need for modification or correction
or amendment that will be done.” If one read between the lines then some
modifications are on the cards.
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The inflexion point
For fiscal 2010-11, the Prime Minister has set a growth target of 8.5 per cent. However, the picture of the current year will
get clearer by the third quarter owing to the on-going worries of global slowdown and a hike in inflation and interest rates.
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Aviation hazard
The Civil Aviation Minister Praful Patel second term began with turbulence in the air. The debts and losses incurred by the Maharaja, delayed important projects, gargantuan mistakes by the management and desperate attempts to camouflage those mistakes have put the concerned Ministry in a tough spot. Here’s UPA-II flight review.
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Bend in the river
Almost from the start, the UPA-II stumbled. Even though the government is no longer dependent on the crutches of Left parties’
support, it still needs considerable political maneuvering to push the envelope of economic
reforms. In this regard, despite the drawbacks of being in a coalition, the government
has somehow managed to pull in enough numbers when it matters.
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Rolling the 3G dice
The battle for spectrum has become quite intense in India where the larger private
operators have been restricted in their ability to deliver voice and data services. But,
there is much more riding on this auction for the 12-odd telecom operators. The entire
sector is already under pressure after the price war and analysts see no change for the rest of 2010.
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Ringing in the good times
Propelling the telecom industry are the new handset manufacturers, mushrooming in India almost everyday, making it possible for a Rs 500 billion-worth Indian handset market to thrive and how.
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Feeling the stones
In the coming months, a below par monsoon and flaring of oil prices would upset the
RBI calculations. For the moment, the Rupee appreciation is taking care of any hike
in oil prices and since the slack season is on, the credit disbursal is expected to be
tepid. Yet, the RBI is behind the curve. In the next half of this fiscal, it will have a lot
of ground to cover. It can’t afford to feel the stones while crossing the river then.
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Long distance call
Indian telecom czar Sunil Mittal is widely being referred as third
time lucky. After two failed attempts to clinch a deal with African
telecom major MTN, Bharti Telecom, the largest mobile company in
India, finally expanded its footprints in African continent. The acquisition
of African assets of Kuwait based Zain Telecom by Bharti for
an estimated amount of US$10.7 billion is the second biggest overseas acquisition by an Indian company.
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Borrowed wisdom
After its first introduction in August 1995 and several years of debate,
the Union Cabinet finally passed the bill that allows foreign universities
to set up campuses in India and offer degrees independently. The
Foreign Educational Institutions (Entry and Operation) Regulation Bill
2010 will permit foreign players to invest 51 per cent of the total
capital expenditure needed to establish the institute in India.
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Commentaries
