Download 13212_INDIA COUNTRY BRIEF 111010

INDIA COUNTRY BRIEF
111010
Basic Political Developments

The 38-day nationwide 'Jana Chetna Yatra' of L K Advani will start tomorrow from
Chapra in Bihar.

Santosh Hegde on Monday disapproved Anna Hazare's anti-Congress stance in the Hisar
bypolls.

Tension prevailed at a private college in Hyderabad as Telangana activists attacked it
demanding its closure.

The West Bengal Congress has named MLA Ajoy Dey and a 15-member committee that
will monitor the Centre's flagship programmes in West Bengal.

CBI registered a first information report (FIR) against Dayanidhi and his brother and Sun
Network managing director Kalanithi Maran in the Aircel-Maxis deal.
National Economic Trends

Ratings agency Crisil on Monday lowered its projection of India's economic growth in
the 2011-12 financial year to 7.6 per cent from its earlier estimate of 8 per cent on
account of the deteriorating domestic investment climate and global economic
uncertainty.

The Government wants to borrow more in the second-half of this financial year.
Business, Energy or Environmental regulations or discussions




Some of India’s biggest and most-respected entrepreneurs have released an open letter to
the government. The group which includes Wipro’s Azim Premji, Anu Aga of Thermax
and HDFC's Deepak Parekh, refers to the anti-corruption Lokpal Bill that is meant to be
introduced soon in Parliament. The industrialists write, “The Lokpal Bill is only one
small but critical step in the national task of weeding out the plague of corruption in
India.
Private equity deals in India are likely to slow down due to a recent industry guideline
that restricts exit options for foreign investing entities.
GE Energy Financial Services and clean energy developer Greenko Group Plc today
announced a venture to develop wind energy projects with a combined investment of
USD 115 million in the country.
Activity in the Oil and Gas sector (including regulatory)

Oil and Natural Gas Corp (ONGC) has said its net profit will drop by over 47 per cent to
below Rs 10,000 crore this fiscal if the government forces it to shell out a higher fuel
subsidy.
Militant Activity/Terrorism
Coimbatore)
(Particularly
in
Bangalore,
Mumbai,
Noida,
Chennai,

The Supreme Court on Monday suspended the death sentence awarded to Pakistani
terrorist Ajmal Kasab in 26/11 Mumbai attack case.

The CPI-Maoist has called all India general shut down on October 11.

The arrest of two PLA cadres in New Delhi has busted the link of Maoists with northeast
rebels and procures consignment of sophisticated weapons from China.
Labor/Social Unrest

At least four farmers were killed and over a dozen injured in Assam on Monday after
police opened fire to disperse a mob of jute cultivators.

The operations of state-owned Coal India Limited (CIL) in Orissa were hit on Monday by
a one-day strike called by its major workers unions.

Striking employees of Maruti Suzuki have seized control of a factory hit by weeks of
labour unrest.
Full Text
Basic Political Developments
Advani's rath to roll for nationwide Jan Chetna Yatra
http://www.uniindia.com/
New Delhi, Oct 10 (UNI) The 38-day nationwide 'Jana Chetna Yatra' of BJP stalwart L K
Advani to awaken the people against corruption and clean leadership will start tomorrow from
Chapra in Bihar. The BJP has been claiming that the six-phase 7600 km nationwide
yatra, which will criss cross nearly 100 districts in 23 states and Union Territories, will decide
political agenda of the country. Bihar Chief Minister and Janata Dal (United) leader Nitish
Kumar will flag off the yatra. For the first time, the BJP's yatra will touch Arunachal Pradesh and
Assam. The octogenarian leader will commence the yatra at 1000 hrs each day and wind up at
2200 hrs touching 100 districts of the country. The yatra will conclude with a rally in Delhi on
November 20. BJP general secretary Ananth Kumar will be Mr Advani's ‘sarathi' charioteer)
during his journey. Mr Kumar said the yatra would be carried out with the participation of the
people and austerity. BJP spokesman Ravishankar Prasad is also a part of the entire yatra which
has a control room in New Delhi. Mr Advani yesterday said he would focus on corruption, price
rise and poverty in his speeches during his journey. "During this journey, I will speak against
corruption, I will speak against price rise. I will mention about the massive poverty despite 60
years of Independence, but I will speak maximum against black money stashed in the foreign
banks," the BJP veteran said.
Anna Hazare's anti-Congress stance incorrect: Justice Hegde
http://www.rediff.com/news/slide-show/slide-show-1-anna-hazare-s-anti-congressTeam Anna member Santosh Hegde on Monday disapproved Anna Hazare's anti-Congress
stance in the Hisar bypolls, saying campaigning against a political party is not correct.
Speaking to PTI in Bengaluru, the former Supreme Court judge said every political party has
"good and honest people" and targeting an outfit as a whole is not correct. He said he is opposed
to such an idea (campaigning against a party).
"The (use of) word Congress is wrong according to me. But to campaign against a corrupt person
or group of persons (is fine) -- not a party....certainly not a party...because every party has good
people..honest people," the former Karnataka Lokayukta said.
Hazare has appealed to the electorate in Hisar not to vote for Congress and other parties who
have not given letters assuring their support to Jan Lokpal Bill.
Telangana protestors attack Hyderabad college
http://ibnlive.in.com/news/telangana-protestors-attack-hyderabad-college/191754-62-131.html
Hyderabad: Tension prevailed at a private college in Hyderabad as Telangana activists attacked
it demanding its closure while the parents of students staged a protest asking the management to
keep it open. Protestors pelted stones at the NRI College in Kukatpally, damaging its window
panes. They were demanding that the management shut the college in view of the ongoing
general strike in Telangana for a separate state.
Earlier, parents of students staged protests outside the college, demanding that the management
run classes. They voiced concern over the future of their children who have already lost classes
for a month.
The protestors, who had a heated argument with the parents, pelted stones on the college
building. Police used batons to disperse protestors, eyewitnesses said.
Confusion prevailed on Monday among students over whether schools and colleges would open
after Dussehra holidays.
The parents' association of the same college had on Sunday held a meeting demanding that the
Telangana Joint Action Committee (JAC) exempt educational institutions from the strike.
Utter confusion prevailed on Monday among students over whether schools and colleges would
open after Dussehra holidays. A large number of students were seen returning from schools as
the managements decided not to run the classes in view of JAC's call to all educational
institutions to remain closed.
In Kukatpally, where a large number of residents hail from coastal Andhra and Rayalaseema
regions, some schools opened amid tight security provided by police.
However, the majority of colleges and schools, especially those run by institutions from Andhra,
remained shut in the twin cities of Hyderabad and Secunderabad.
All government-run educational institutions in Hyderabad and nine other districts of Telangana
also remained closed as over 120,000 teachers continued the strike seeking a separate state.
The educational institutions are closed in the region for nearly a month as teachers have joined
hands with other government employees in the people's strike.
West Bengal: Congress names Mamata detractors
http://indiatoday.intoday.in/story/congress-mamata-banerjee-ajoy-dey-deepadasmunshi/1/154401.html
Trinamool Congress chief Mamata Banerjee.In a move that is certain to anger Mamata Banerjee,
the Congress has named MLA Ajoy Dey and known detractors of the chief minister like Deepa
Dasmunshi to a 15-member committee that will monitor the Centre's flagship programmes in
West Bengal.
This is expected to complicate matters with the Trinamool Congress. The state government has
not fared well in implementing schemes connected with the rural health mission, the urban
renewal mission, the right to education and the rural jobs scheme. The committee is expected to
submit its assessment every quarter to the Congress high command, an exercise which will
surely make the CM fume.
Party, family desert Dayanidhi Maran as CBI conducts raids
http://timesofindia.indiatimes.com/india/Party-family-desert-Dayanidhi-Maran-as-CBI-conductsraids/articleshow/10299728.cms
CHENNAI: As CBI sleuths continue raiding the residence of former Union minister Dayanidhi
Maran and six other places including Sun TV's office in Chennai, the Maran brothers stand
deserted by the DMK and the Karunanidhi family. The raids started at 7am on Monday after the
CBI registered a first information report (FIR) against Dayanidhi and his brother and Sun
Network managing director Kalanithi Maran in the Aircel-Maxis deal.
A team led by assistant superintendent of police Ravi Gambhir from Delhi and six other officers
including a woman officer went to Dayanidhi Maran's house at 7.15am. The security guard at the
gate refused to let them in. After 20 minutes, the officials barged into the house when the gate
was opened to let in a maid.
Maran doesn't appear to have the sympathies of the party leaders or members of the Karunanidhi
family. While Karunanidhi's elder son M K Alagiri has been openly against Maran,
Karunanidhi's younger son M K Tamilarasu is the only person who went to Maran's place on
Monday. Party functionaries kept away from the place. Party president M Karunanidhi and
treasure M K Stalin are in Trichy for the local body poll campaign.
"We passed on the message to Thalaivar (leader) in the morning as soon as he reached Sangam
Hotel in Trichy. He just received the message with a smile," a former DMK minister told TOI.
Earlier Karunanidhi had commented that Maran has the capacity to face the matter on his own.
Sources said Karunanidhi is unlikely to spring to Maran's defence. "The DMK has suffered a lot
because of Dayanidhi Maran. Thalaivar feels that he is the main reason for many damages. So he
will watch the developments silently" said a senior DMK MP.
Sources said Kalanithi Maran and his wife Kavery Kalanithi Maran had been in Delhi in the last
week. "Kalanithi's children came to Chennai this morning and they have gone to school. We
don't know where the boss is," a driver said.
National Economic Trends
Crisil cuts India GDP growth forecast for FY12 to 7.6%
Press Trust of India, October 10, 2011 ( New Delhi )
http://profit.ndtv.com/news/show/crisil-cuts-india-gdp-growth-forecast-for-fy12-to-7-6-182581
Ratings agency Crisil on Monday lowered its projection of India's economic growth in the 201112 financial year to 7.6 per cent from its earlier estimate of 8 per cent on account of the
deteriorating domestic investment climate and global economic uncertainty.
"The forecast has been scaled down in view of the deteriorating global economic scenario and
the grim investment climate in India on account of the policy environment," Crisil said in a
statement.
The forecast for the Indian economy is based on the assumption that developed economies will
witness a slowdown, but another recession will be averted, it said.
In May, Crisil had projected the economic growth rate of the country in FY'12 at 7.7-8.0 per
cent.
During the first quarter of the current fiscal, the Indian economy grew by 7.7 per cent.
"While we had anticipated the impact of rising interest rates and slowing government
expenditure, the deceleration in advanced countries has been sharper than expected. This, in
conjunction with the weak investment climate, is impacting India's GDP growth prospects. We
now project the Indian economy to grow at 7.6 per cent in 2011-12," said Crisil Managing
Director Roopa Kudva.
The industry is projected to grow at a slower rate of 6.5 per cent in 2011-12, as against the
previous forecast of 7.3 per cent.
Besides the adverse impact of interest rate hikes, regulatory hurdles in the mining sector (an
important source of raw material) are likely to hamper industrial activities.
The slowdown in the industrial sector is expected to spill over to services and will affect sectors
such as trade, hotels and investment-led services like banking, she said.
"Overall, we now expect services to grow at 9.2 per cent this year as compared to our previous
estimation of 9.4 per cent. Normal monsoons and good sowing, however, have led us to
upwardly revise the agricultural GDP forecast for 2011-12 to 3.2 per cent from 2.7 per cent," she
added.
In addition, Crisil's WPI inflation forecast for 2011-12 has been revised upward to 9.1 per cent
from the earlier projection of 8.0-8.5 per cent.
"Inflation in the first five months of the current fiscal, at 9.6 per cent, has surged past our earlier
expectations," Kudva said.
In addition, Crisil said the recent rupee depreciation will limit the positive impact of a decline in
commodity and oil prices. Crisil has also revised its outlook for the rupee to 45-46 per US dollar
by March, 2012, from the earlier projection of Rs. 43-44/USD per dollar.
According to Crisil Chief Economist Dharmakirti Joshi, the worsening global outlook and the
consequent risk aversion in emerging markets has affected FII inflows into India, thereby
reducing the supply of US dollars in the country.
Simultaneously, rising repayment pressure on external debt held by the private sector has led to
increasing demand for US dollars. The ensuing imbalance has necessitated the change in the
rupee outlook, it said.
If there is no double-dip in advanced countries, FII inflows may pick up in the early part of 2012,
as risk appetite for investment in emerging markets will return. This would help strengthen the
rupee, it added.
Government's apathy to small savings schemes
http://www.thehindu.com/business/Economy/article2523378.ece
The Government wants to borrow more in the second-half of this financial year. Thus, fiscal
slippage has come to the centre stage along with the discussions on controlling inflation.
Spiraling and unabatedly continuing inflation is a concern. But fiscal indiscipline will very much
exacerbate inflation.
The reasons the government cited for this was due to lower-than-expected cash surplus at the
start of the financial year and also on account of revenue shortfall under the National Small
Savings Fund (NSSF). Even though the government indicated that its fiscal deficit calculations
remain unchanged, one of the major sources of the budget deficit — considered at the time of the
last Union Budget — was small savings schemes of the government. A report of the Finance
Ministry released recently said that net small savings deposits turned negative in the first quarter
of 2011-12 and it has impacted government's cash management.
Interestingly, interest rates of many savings schemes offered by the government were static since
2003, while bank deposit rates moved up many folds. Various types of small savings schemes
offer interest rates between 3.5 per cent and 8.40 per cent. The only scheme which offers a
higher interest rate is the 5-year Senior Citizens' Savings Scheme (SCSS) which offers 9 per
cent. However, for senior citizens, many public sector banks are offering much higher rates,
adding another 25-50 basis points.
Further the government's borrowing programme surprised markets. The government announced
its borrowing programme for the second-half of the current fiscal which was higher by Rs.52,900
crore over the market expectations. Yields of the benchmark 10-year Government Securities (GSec) had been in the range of 8.28-8.35 per cent till recently. After the announcement of higher
borrowing programme by the government, the yields of the 10-year government bonds have shot
up by 10 basis points to close at 8.44 per cent in the previous week. Last week, it moved up
further to close at 8.55 per cent against 7.93 per cent a year ago. The 5-year G-Sec also was at
8.33 per cent last Friday against 7.75 per cent a year ago.
The deposit rates now hover around 8.50-9.25 per cent as compared to 7-8 per cent a year ago.
However, some banks offer higher fixed deposit rates which are floating between 9.50 per cent
and 10.50 per cent for various maturities.
The Prime Lending Rates (PLRs) charged by various banks remain almost static as compared to
one year ago at 11-15.75 per cent. The rate for savings bank account had also been revised by the
Reserve Bank of India from 3.50 per cent to 4 per cent in May 2011, when it announced
Monetary Policy for 2011-12. However, the gap between savings bank rate and other bank rates
have been widened significantly. In tandem with rising interest rates, Call Money rate, which is
an overnight rate, has also moved up to 8.05 per cent from 5.75 per cent around the same period
in 2010.
Meanwhile, headline inflation in August accelerated to 9.78 per cent, its highest in more than a
year, from 9.22 per cent in July.
Weekly food inflation as on September 24 accelerated to 9.41 per cent from 9.31 per cent in the
previous week. Fuel price inflation moved up to 14.69 per cent as per the latest data of the
government.
Clearly, the high interest rates being offered by banks make people move out of the small
savings schemes. The Shyamala Gopinath Committee on Comprehensive Review of National
Small Savings Fund recommended to the government a positive spread of 25 basis points, vis-àvis government securities of similar maturities with a few exceptions, “taking into account the
interests of small savers, and in view of the absence of social security among the unorganised
sections of the society, as also the liquidity augmenting measures for various instruments”.
Exceptions are recommended only in the case of 6-year National Savings Certificate (NSC) and
SCSS. The Committee notes that NSC cannot be withdrawn before maturity, which affects its
liquidity. Keeping in view the longish tenor of the 6-year NSC and the absence of liquidity, the
Committee favours a higher illiquidity premium of 50 basis points (instead of 25 basis points as
in the case of other instruments). As regards SCSS where the rate of interest is currently fixed at
9 per cent, the Committee recommended a spread of 100 basis points over and above the
secondary market yield of government securities of similar maturity.
The Committee, which had given its report in June to the government agrees with the
recommendations of the Reddy (2001) and Rakesh Mohan (2004) committees that the secondary
market yields on Central Government securities of comparable maturities should be the
benchmark for various small savings instruments (other than savings bank deposits, which do not
have a fixed maturity). The Shyamala Gopinath Committee also recommended various measures
to improve liquidity, flexibility in revising rates and maturities as well as making schemes more
attractive for small savers.
The government's apathy towards small savings schemes is clear. If the authorities make the
small savings schemes more attractive, more funds will come through this government channel.
The government had borrowed Rs.2.50-lakh crore in the first-half of 2011-12 out of the
announced dated borrowing programme for the fiscal at Rs.4.17-lakh crore. Taking these figures
into consideration, the market was expecting the Reserve Bank of India to announce a dated
borrowing programme of Rs.1.67-lakh crore for the second-half of the current fiscal. But the
government announced a dated borrowing programme of Rs.2.20-lakh crore, or around
Rs.52,900 crore in excess of the anticipated amount. If small savings collections do not improve
by the financial year end, the government has to resort to another bout of borrowing. This will
make the central bank's position further difficult while shaping its monetary stand for the year
2012-13.
Business, Energy or Environmental regulations or discussions
DIPP's new rule restricts exit options may hit PE deals for foreign investing entities
http://economictimes.indiatimes.com/news/news-by-industry/banking/finance/dipps-new-rulerestricts-exit-options-may-hit-pe-deals-for-foreign-investing-entities/articleshow/10295019.cms
MUMBAI: Private equity deals in India, one of the fastest growing markets in the world, are
likely to slow down due to a recent industry guideline that restricts exit options for foreign
investing entities.
Since the new policy issued on September 30, by the Department of Industrial Policy and
Promotion (DIPP) would effectively cover all transactions between Indian and foreign entities,
joint venture arrangements could also likely come under its ambit.
The DIPP, through the initiative, has aimed at revising the foreign direct investment policy on
the use of put and call options. Under this consolidated FDI policy, which is effective from
October 1, instruments with built-in options of any type would not qualify as an eligible
instrument of FDI.
Any equity instrument issued by an Indian company and subscribed by any foreign entity which
allows the foreign firm to exit the arrangement through a buyback or through put and call option,
will be treated as external commercial borrowing (ECB), says the department. Since ECBs are
subject to caps and limits, such a move would restrict all foreign companies from exiting
ventures, which will discourage any foreign investor.
"It is a significant setback for most private equity transactions where the investor is a foreign
entity," said the head of a large international private equity firm that has significant investments
in Indian infrastructure projects.
Most large private equity firms that ET spoke to were concerned about the impact the policy
would have on all deals and did not want to comment. Most of the world's large PE firms have a
presence in India. The firms include marquee names like Blackstone, Goldman Sachs, Actis, 3i,
Bain & Co.
Typically, all agreements between resident companies and non-resident entities invariably
include the option that allows the foreign entity to exit or for the Indian company to buy out the
foreign investment.
"It can be termed the single biggest deterrent for private equity transactions," said Punit Shah,
partner, tax and regulatory services at KPMG. "In an economy like India where exit options are
very limited, including IPOs, such a step would adversely impact the FDI flows into the
country," he added.
The DIPP guidelines were issued at a time when the Reserve Bank of India raised concerns about
foreign investors exiting through the put option route. According to people familiar with the
framing of the guidelines, the DIPP move was aimed at reining in transactions in real estate that
came under the garb of FDI-compliant investment, but were actually ECBs. "It is a big
impediment for foreign investors," says Bharat Banka, CEO of Aditya Birla Private Equity.
"Most PE deals will now not be concluded, but will be deferred," he added.
While the policy does not clearly mention whether it would apply to previous deals, senior
executives of PE firms that ET spoke to said that policy would 'grandfather' past deals, implying
that it will apply only to future transactions.
GE, Greenko announce USD 115 mn wind energy venture in India
http://economictimes.indiatimes.com/news/news-by-industry/energy/oil-gas/ge-greenkoannounce-usd-115-mn-wind-energy-venture-in-india/articleshow/10301952.cms
BANGALORE: GE Energy Financial Services and clean energy developer Greenko Group Plc
today announced a venture to develop wind energy projects with a combined investment of USD
115 million in the country.
The GE unit would invest USD 50 million - its first renewable energy investment in India - to
support the development of 500 MW of wind projects out of Greenko's planned development of
1 GW of wind projects in India.
Greenko has committed USD 65 million for the venture, a newly created subsidiary of Greenko,
known as Greenko Wind Project Private Limited.
"This investment expands GE's presence in one of the world's fastest growing power markets
with a local, proven renewable energy developer," Raghuveer Kurada, Managing Director and
leader of India at GE Energy Financial Services, said.
Greenko is currently developing a pipeline of wind projects in Maharashtra, Andhra Pradesh,
Karnataka and Rajasthan, which the new venture, an Indian holding company and Greenko
subsidiary specifically set up to develop wind projects, would own.
The first project, the 65-MW Ratnagiri wind farm in Maharashtra, is planned for completion in
December and would use GE's 1.6-MW turbines. The wind turbines, specifically designed for
low and medium wind speeds, would be assembled at GE's facility in Pune.
"Once operational, a 500-MW wind portfolio could generate enough renewable electricity to
power 8,75,000 average Indian households and displace 7,00,000 tonnes per year of greenhouse
gas emissions," a GE statement said.
"Wind power is an increasingly important part of the Indian energy market, and through our
partnership with GE, a global energy leader, we are well positioned to play an important role in
helping to meet the country's energy needs with clean power using advanced technology," Anil
Kumar Chalamalasetty, CEO and Managing Director of Greenko, said.
India Inc write second open letter to govt about corruption
NDTV Correspondent, October 10, 2011 (New Delhi)
http://profit.ndtv.com/news/show/india-inc-write-second-open-letter-to-govt-about-corruption182583
Some of India’s biggest and most-respected entrepreneurs have released an open letter to the
government. The group which includes Wipro’s Azim Premji, Anu Aga of Thermax and HDFC's
Deepak Parekh, refers to the anti-corruption Lokpal Bill that is meant to be introduced soon in
Parliament. The industrialists write, “The Lokpal Bill is only one small but critical step in the
national task of weeding out the plague of corruption in India. This draft Lokpal Bill is intended
to address episodic corruption, but is unlikely to have any significant impact on the day-to-day
corruption which is insidious and demeaning. In January, the same group made headlines with its
first letter which alerted the leaders of the country to a “growing governance deficit” and
“galloping corruption.” The entrepreneurs had offered to periodically share suggestions with
politicians and the government. The new note follows that lead.
With India hurtling from news of one massive swindle to another, all of them involving
bureaucrats, politicians and practitioners of power, the industrialists write, “It is acknowledged
that a strong nexus exists between certain corporates, politicians, bureaucrats and power brokers.
This is one of the greatest threats for the Indian economy.”
The letter refers to the UK’s recent enactment of the ‘The Bribery Act, 2010’ which makes it
illegal to offer and receive bribes; it also penalises failure to prevent bribery. India Inc says the
Act “extends culpability to the highest levels in an accused corporation. Only if timely and
punitive action is taken against both, the giver as well as the receiver of the bribe, will the fight
against ground level corruption be won effectively.”
In addition to asking for specialized and fast-track courts to ensure that complaints against
corruption are dealt with quickly and effectively, the letter asks for land, judicial, electoral and
police reforms. “It is imperative, however, that legislative reforms be constructively and
constitutionally debated in a time-bound and orderly manner and not in uncivil and hostile
environments. Disruption, both in the Parliament and outside is socially debilitating and erodes
public confidence,” the note warns.
India Inc also makes the point that the delay in environmental clearances is affecting investment
in the country. The group writes, “It is worthwhile considering the introduction of an on-line
auction process for allocation of natural resources.”
Activity in the Oil and Gas sector (including regulatory)
ONGC says net profit to dip below Rs 10,000 crore this fiscal
http://economictimes.indiatimes.com/news/news-by-industry/energy/oil-gas/ongc-says-netprofit-to-dip-below-rs-10000-crore-this-fiscal/articleshow/10301341.cms
NEW DELHI: State-owned Oil and Natural Gas Corp (ONGC) has said its net profit will drop
by over 47 per cent to below Rs 10,000 crore this fiscal if the government forces it to shell out a
higher fuel subsidy.
Upstream oil firms, led by ONGC, traditionally bear one-third of the actual revenue that retailers
lose on selling diesel, LPG and kerosene at government-controlled prices.
But this year, the share of upstream companies would not be based on the actual underrecoveries, or revenue losses, of retailers. Rather, they would be based on the projected notional
under-recoveries that existed before the June fuel price increase and duty cuts.
At a $110 per barrel crude oil price, the revenue loss before the June price hike was estimated at
Rs 171,140 crore, while at today's prices, it stands at around Rs 121,140 crore.
ONGC, in a letter to the Oil Ministry, said the one-third share of upstream companies as per the
June estimates works out to Rs 57,041 crore, of which ONGC's share would be Rs 47,361 crore.
But if current estimates, are taken the upstream share would be Rs 40,380 crore (Rs 33,528 crore
of ONGC).
The company gives discounts on the crude oil it sells to Indian Oil, Bharat Petroleum and
Hindustan Petroleum to part- meet the revenue loss retailers incur on subsidised fuel sales.
"In such a scenario (where upstream firms are asked to pay one-third of the projected underrecoveries in June), the price realisation of ONGC would be $41.27 per barrel," it wrote.
ONGC said it expects to register a net profit of Rs 15,000 crore in the 2011-12 fiscal, based on a
net crude oil price realisation of $55 per barrel. "In case realisation is of the order of $40 per
barrel, the profit-after-tax would be below Rs 10,000 crore."
It had in 2010-11 reported a net profit of Rs 18,924 crore.
ONGC said a lower profit would hurt its Rs 30,000 crore planned capital expenditure and also
impact plans to provide another Rs 7,500 crore in financial support to its overseas subsidiary in
2011-12.
Stating that it normally caters to investment plans from its internal resources, it said even at a net
profit of Rs 15,000 crore, the company faced a shortfall of about Rs 12,500 crore in meeting its
planned expenditure and assistance to ONGC Videsh Ltd in FY'12.
"However, in case ONGC's net realisation for 2011-12 works out to $40 per barrel, ONGC's
profit-after-tax is expected to fall down below Rs 10,000 crore and the deficit would increase to
Rs 17,500 crore," it wrote.
ONGC had in 2010-11 paid Rs 24,892 crore out of the total upstream fuel subsidy share of Rs
30,297 crore. In the first quarter of current fiscal, it paid Rs 12,046 crore to compensate for fuel
subsidies.
Militant Activity/Terrorism
Coimbatore)
(Particularly
in
Bangalore,
Mumbai,
Noida,
Chennai,
Supreme Court stays Ajmal Kasab’s death sentence
http://www.thehindu.com/news/article2525662.ece?homepage=true
The Supreme Court on Monday suspended the death sentence awarded to Pakistani terrorist
Ajmal Kasab in 26/11 Mumbai attack case, saying that it would like to hear his plea challenging
capital punishment at length as “due process of law” has to be followed, even though many feel
that the appeal should be outrightly “rejected”.
While staying Kasab’s death sentence and agreeing to deal with the appeal expeditiously, a
special bench of justices Aftab Alam and C. K. Prasad also permitted him to amend his Special
Leave Petition and furnish additional grounds to challenge the sentence awarded to him by the
special court and confirmed by the Bombay High Court.
While staying the execution, the bench also complimented senior counsel and amicus curie Raju
Ramachandran for taking up the 2008 terror attack case and agreeing to assist the court.
“In our country many people are of the view that the appeal should be rejected (outrightly) and
should not be heard at all but we are happy that you have decided to assist the court as amicus,”
the bench told Mr. Ramachandran.
It said it would like to hear the matter at length “as the rule of law is supreme in the country and
the due process of law has to be observed“.
Agreeing with the bench’s view, former Solicitor General Gopal Subramaniam, appearing for the
Maharashtra government, said despite the magnitude of the terror attack, the due process of law
has to be maintained and the matter needed to be dealt with expeditiously.
He submitted that all documentation and translation work relating to the trial court and the High
Court have been completed and as such the apex court may deal with the appeal in an
expeditious manner.
The court agreed that it would deal with the appeal in an expeditious manner.
Maoists hold meet in Agency
http://www.thehindu.com/news/cities/Visakhapatnam/article2525041.ece
The CPI (Maoist) organised a meeting during the weekly shandy at Korukonda in the Visakha
Agency on Sunday, where they wanted people to support and participate in the Bharat bandh
they called on October 11.
Maoists gave the bandh call to protest against the “arrest” of one of its top leaders and member
of the Andhra-Orissa border special zonal committee Damodar alias Azad 15 days ago by the
Andhra Pradesh police on the Andhra-Orissa border.
Narendra, leader of the Korukonda area committee of the CPI (Maoist), said during the meeting
that there was a possibility of Damodar being killed in custody and demanded that the police
produce Damodar in court. He warned that the government would pay a heavy price if Damodar
was not produced in court.
Naxal plan to procure Chinese arms foiled
http://www.asianage.com/india/naxal-plan-procure-chinese-arms-foiled-779
Oct 10, 2011 - MANOJ ANAND | Age Correspondent| GUWAHATI.Share ..The arrest of two
PLA rebels in New Delhi has not only busted the link of Left wing Maoist groups with northeast
rebels but also foiled their attempt to procure consignment of sophisticated weapons from China
through northeast separatist groups.
Disclosing that security agency was following self-style captain of PLA Wangba, alias N. Dilip
Singh, and Lt. Arun Kumar Singh Salam for past several weeks, the authoritative security
sources, however, said that their one of the important linkman managed to flee from its hideout
in Maharashtra’s Pune.
Informing that security forces are still trying to apprehend the PLA rebel who managed to escape
from Pune, security sources said that PLA captain Wangba has confessed to have received about
`20 lakhs from Maoists to supply sophisticated weapons available with northeast rebels in their
hideout in Burma. Wangba also visited Dantewara in Chhattisgarh besides Jharkhand where he
had meeting with Maoist leader Kihshenji.
Asserting that arrest of duo has shattered the link between Maoist and Manipur’s PLA, security
sources said that Mr Wangba was key man who was coordinating training of Maoist cadres in
Burma camps. Claiming that a group of Maoist rebels have already been imparted training at
Burma camp of PLA, security sources said that Wangba was in process of coordinating training
for a new batch.
Referring that left-wing Maoist had signed a joint declaration with PLA in 2008 to develop a
working relationship between the two organisations, security sources pointed out that since then
Wangba who was also the in charge of external affairs of PLA was in touch with Maoist and
coordinating various kind of help to each others.
Wangba had recently shifted his hideout from Guwahati to New Delhi.
Apart from arms and ammunition, Wangba was also supplying high-tech communication
equipment to Maoists.
.
Labor/Social Unrest
Four Assam jute farmers killed in police firing
http://zeenews.india.com/news/north-east/four-assam-jute-farmers-killed-in-policefiring_735864.html
Guwahati: At least four farmers were killed and over a dozen injured in Assam on Monday after
police opened fire to disperse a mob of jute cultivators who were enforcing a road blockade to
demand better prices for their produce.
A police spokesperson said that about 500 jute farmers resorted to a highway blockade near
Besimari in Darrang district, about 80 km north of Assam's main city of Guwahati.
"The protestors pelted stones and attacked a security team that went to clear the road blockade.
The situation turned violent and that prompted police to open fire," a senior police official said.
Four farmers were killed and about 15 people injured, including six policemen. "The injured
were shifted to local hospitals with multiple injuries," the official said.
Witnesses said the protestors attacked security personnel using crude implements and that led the
police to open fire.
"The situation is under control, but tense. Additional reinforcements have been rushed to the
area," the official said.
A bumper jute harvest this year has added to the woes of farmers and in the absence of a market
to sell their produce, the cultivators were demanding government support to sell their produce.
"We were demanding that the government should create some mechanism to help the farmers to
sell our produce. But persistent demands failed, so we resorted to the road blockade," Abdul
Hamid, a jute farmer, said.
"The police firing was uncalled for as they first tried to chase us by caning and that infuriated the
protestors."
Strike hits Coal India mines in Orissa
http://profit.ndtv.com/news/show/strike-hits-coal-india-mines-in-orissa-182564
The operations of state-owned Coal India Limited (CIL) in Orissa were hit on Monday by a oneday strike called by its major workers unions, an official said.
There was no mining or transportation of coal from the two fields run by Mahanadi Coalfields
Ltd (MCL), a CIL subsidiary.
Workers skipped work at all the mines in the Talcher coalfield area in Angul district and IB
Valley Coalfield area in Jharsuguda district.
"The raising and transportation have been totally stopped," Mahanadi Coalfields Ltd (MCL)
public relations officer Dikken Mehera said.
The daily output at CIL's Orissa mines is estimated at 300,000 tonnes. Monday's strike will cause
a loss of about Rs.18 crore, he added.
Five leading unions of CIL -- the Congress-backed Indian National Trade Union Congress
(INTUC), the Left backed CITU and AITUC, the Hind Mazdoor Sabha and the Bharatiya Janata
Party (BJP)-backed Bharatiya Mazdoor Sangh, have joined the strike.
The unions have been demanding Rs.25,000 as productivity-linked bonus or ex-gratia this year,
but the management offered only Rs.17,000. Other demands include early wage revision.
Maruti workers seize control of Manesar plant wracked by unrest
http://economictimes.indiatimes.com/news/news-by-industry/auto/automobiles/maruti-workersseize-control-of-manesar-plant-wracked-by-unrest/articleshow/10301308.cms
MUMBAI: Striking employees of Maruti Suzuki, India's biggest carmaker, have seized control
of a factory hit by weeks of labour unrest, the company said on Monday, as a stand-off that has
cost the firm over $150 million descended into violence.
Workers attacked managers and supervisors and damaged equipment at the Manesar plant,
Maruti said, shutting down production for a third consecutive day as the company battles
slowing demand in Asia's third-largest economy.
"The plant is effectively captive in the hands of striking workers who are bent upon violence,"
the company said in a statement, describing the situation at the factory as "grave."
Maruti has said it would not compromise with the workers who began their initial strike on
August 29 after refusing to sign a discipline agreement ordered by the company following
accusations of workers deliberately sabotaging car production.
A spokesman for the Maruti Suzuki Employees Union (MSEU), the body co-ordinating the
unrest that is not recognised by the company, was not reachable for comment on Monday. But
the union has repeatedly denied sabotaging production.
"What we are demanding is that the casual workers should be taken back," MSEU executive
member Sushil Kumar said on Saturday, referring to hundreds of part-time workers fired by
Maruti during the unrest.
Maruti, 54.2-percent owned by Japan's Suzuki Motor, said 1,500 workers were inside the factory
on Monday. The plant produces about 1,000 vehicles a day and the unrest has caused a
production loss of 2,600 cars since Friday afternoon.
Supporting strikes by workers at other Suzuki-owned plants in India that supply parts to Maruti's
second car factory have resulted in a total loss of production of about $22 million.
Maruti announced an agreement with striking workers last week to end a month-long strike that
has already cost the automaker 6.6 billion rupees ($134 million) in lost output and contributed to
a 21-percent slump in September sales.
The carmaker's total losses due to labour unrest this year stand at close to $250 million,
following a 13-day strike by 800 workers in June at Manesar that crippled production and caused
more than $90 million in lost output.
The continued unrest at Manesar comes as Indian carmakers reported a 1.8-percent drop in
September sales, as rising interest rates and vehicle costs hurt demand in the world's secondfastest growing major auto market after China.
"The company cannot throw out mobs of people," a Maruti spokesman said. "The action has to
come from the police and the authorities."
The strikes at the Manesar plant, which produces the popular Swift and A-Star hatchbacks, have
also sparked unrest at Suzuki Powertrain India, which provides engines to Maruti. The unrest had
reduced output at the plant to around 65 percent on Monday.
Gunshots were fired by a labour contractor at a Suzuki motorcycle factory after workers there
also downed tools to support the Manesar action, a Maruti spokesman said.
Shares in the carmaker closed down 3.8 percent at 1,071 rupees ($21.79) on Monday, against a
2.2-percent rise in Mumbai's benchmark index .
Maruti shares have fallen nearly 24 percent in 2011, underperforming a nearly 20-percent fall in
the broader market.