Daily Economic News 14 Dec 2016

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economic-news14Indian Economy News

December 14, 2016

ND has initiated a new section of daily news, where our news desk compiles the latest news on the Indian economy, to keep our readers abreast and updated on daily economic state of affairs.

The economy news compilations bring business news reports that are relevant today and tomorrow, based on the new pattern of current affairs, and for English awareness. This gives vital inputs on the various sectors of the Indian Industry and trade.


Consumer Price Index Numbers on Base 2012=100 for Rural, Urban and Combined for the Month of November 2016

Press Information Bureau:  December 14, 2016

The Central Statistics Office (CSO), Ministry of Statistics and Programme Implementation has revised the Base Year of the Consumer Price Index (CPI) from 2010=100 to 2012=100 with effect from the release of indices for the month of January 2015.

  1. In this press note, the CPI (Rural, Urban, Combined) on Base 2012=100is being released for the month of November 2016. In addition to this, Consumer Food Price Index (CFPI) for all India Rural, Urban and Combined are also being released for November 2016. All India Inflation rates (on point to point basis i.e. current month over same month of last year, i.e., November2016 over November 2015),based on General Indices and CFPIs are given as follows:

All India Inflation rates (%) based on CPI (General) and CFPI

Indices November 2016 (Prov.) October 2016 (Final) November 2015 (Final)
Rural Urban Combd. Rural Urban Combd. Rural Urban Combd.
CPI (General)

4.13

3.05 3.63 4.78 3.54 4.20 5.95 4.71 5.41
CFPI 2.87 0.75 2.11 3.86 2.33 3.32 5.75 6.53

6.07

Notes: Prov.  – Provisional, Combd. – Combined

  1. Monthly changes in the General Indices and CFPIs are given below:

Monthly changes (%) in All India CPI (General) and CFPI: Nov. 2016 over Oct. 2016

Indices Rural Urban Combined
Index Value % Change Index Value % Change Index Value % Change
Nov.16 Oct.16 Nov.16 Oct.16 Nov.16 Oct.16
CPI (General)

133.6

133.8 -0.15 128.4 128.6 -0.16 131.2 131.4 -0.15
CFPI 136.2 137.1 -0.66 134.7 136.2 -1.10 135.7 136.8

-0.80

Note: Figures of November 2016 are provisional.

  1. Provisional indices for the month of November 2016 and also the final indices for October 2016 are being released with this note for all-India and for State/UTs. All-India provisional General (all-groups), Group and Sub-group level CPI and CFPI numbers for November 2016 for Rural, Urban and Combined are given in Annexure I. The inflation rates of important categories of items are given in Annexure II. State/UT wise provisional General CPI numbers for Rural, Urban and Combined are given in Annexure III. Inflation rates of major States, having population more than 50 lakhs as per population Census 2011, are given in Annexure IV. State/UT–wise Group CPIs are available on the Ministry’s website (www.mospi.gov.in).
  2. Price data are collected from selected towns by the Field Operations Division of NSSO and from selected villages by the Department of Posts. Price data are received through web portals, maintained by the National Informatics Centre.

Next date of release:  12th January 2017 (Thursday) for December 2016.

Annexure I

All India Consumer Price Indices

(Base: 2012=100)

Group Code Sub-group Code Description Rural Urban Combined
Weights Oct. 16 Index
(Final)
Nov. 16 Index
(Prov.)
Weights Oct. 16 Index
(Final)
Nov. 16 Index
(Prov.)
Weights Oct. 16 Index
(Final)
Nov. 16 Index
(Prov.)
(1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12)
  1.1.01 Cereals and products 12.35 131.3 132.1 6.59 128.7 130.2 9.67 130.5 131.5
  1.1.02 Meat and fish 4.38 137.6 137.5 2.73 138.4 138.5 3.61 137.9 137.9
  1.1.03 Egg 0.49 130.1 130.7 0.36 130.3 134.0 0.43 130.2 132.0
  1.1.04 Milk and products 7.72 136.0 136.4 5.33 132.7 132.9 6.61 134.8 135.1
  1.1.05 Oils and fats 4.21 120.8 121.1 2.81 112.5 112.6 3.56 117.8 118.0
  1.1.06 Fruits 2.88 138.4 137.0 2.90 130.4 130.8 2.89 134.7 134.1
  1.1.07 Vegetables 7.46 149.2 142.1 4.41 155.1 142.0 6.04 151.2 142.1
  1.1.08 Pulses and products 2.95 170.2 169.9 1.73 175.7 174.8 2.38 172.1 171.6
  1.1.09 Sugar and Confectionery 1.70 113.4 113.5 0.97 115.4 115.5 1.36 114.1 114.2
  1.1.10 Spices 3.11 136.3 136.8 1.79 145.3 145.4 2.50 139.3 139.7
  1.2.11 Non-alcoholic beverages 1.37 128.7 128.8 1.13 122.5 122.6 1.26 126.1 126.2
  1.1.12 Prepared meals, snacks, sweets etc. 5.56 142.4 143.1 5.54 139.6 140.3 5.55 141.1 141.8
1   Food and beverages 54.18 137.4 136.7 36.29 136.3 135.1 45.86 137.0 136.1
2   Pan, tobacco and intoxicants 3.26 140.9 141.2 1.36 144.3 144.3 2.38 141.8 142.0
  3.1.01 Clothing 6.32 139.6 140.0 4.72 129.1 129.6 5.58 135.5 135.9
  3.1.02 Footwear 1.04 134.3 134.5 0.85 121.9 122.1 0.95 129.1 129.3
3   Clothing and footwear 7.36 138.8 139.2 5.57 128.0 128.5 6.53 134.5 135.0
4   Housing 21.67 128.7 129.1 10.07 128.7 129.1
5   Fuel and light 7.94 129.8 130.4 5.58 115.2 116.2 6.84 124.3 125.0
  6.1.01 Household goods and services 3.75 131.8 132.2 3.87 124.5 124.6 3.80 128.4 128.6
  6.1.02 Health 6.83 128.7 129.0 4.81 121.8 122.1 5.89 126.1 126.4
  6.1.03 Transport and communication 7.60 117.8 118.2 9.73 112.8 113.4 8.59 115.2 115.7
  6.1.04 Recreation and amusement 1.37 126.5 126.9 2.04 121.2 121.7 1.68 123.5 124.0
  6.1.05 Education 3.46 133.0 133.7 5.62 131.9 132.1 4.46 132.4 132.8
  6.1.06 Personal care and effects 4.25 123.0 123.5 3.47 120.8 121.3 3.89 122.1 122.6
6   Miscellaneous 27.26 125.7 126.1 29.53 120.9 121.3 28.32 123.4 123.8
General Index (All Groups) 100.00 133.8 133.6 100.00 128.6 128.4 100.00 131.4 131.2
Consumer Food Price Index 47.25 137.1 136.2 29.62 136.2 134.7 39.06 136.8 135.7

Notes:

  1.  Prov. : Provisional.
  2.  – : CPI (Rural) for housing is not compiled.
  3. The weights are indicative to show relative importance of groups and sub-groups. However, all India indices have been compiled as weighted average of State indices.

Annexure II

All India annual inflation rates (%) for November 2016 (Provisional)

(Base: 2012=100)

Notes:

  1. Prov. : Provisional.
  2. – : CPI (Rural) for housing is not compiled.
  3. # : More than those of Rural as well as Urban due to rounding. 

Annexure III

State/UT wise General Consumer Price Indices

(Base: 2012=100)

State/UT Code Name of the State/UT Rural Urban Combined
Weights Oct. 16 Index
(Final)
Nov. 16 Index
(Prov.)
Weights Oct. 16 Index
(Final)
Nov. 16 Index
(Prov.)
Weights Oct. 16 Index
(Final)
Nov. 16 Index
(Prov.)
(1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11)
01 Jammu & Kashmir 1.14 132.9 134.5 0.72 125.1 125.2 0.94 130.1 131.2
02 Himachal Pradesh 1.03 133.4 134.0 0.26 124.2 124.9 0.67 131.7 132.4
03 Punjab 3.31 130.0 129.9 3.09 126.7 126.7 3.21 128.5 128.5
04 Chandigarh 0.02 142.9 143.7 0.34 125.2 125.6 0.17 126.2 126.6
05 Uttarakhand 1.06 128.6 128.7 0.73 121.0 121.9 0.91 125.8 126.2
06 Haryana 3.30 131.3 131.8 3.35 124.5 124.5 3.32 128.1 128.4
07 Delhi 0.28 129.2 129.0 5.64 130.8 131.1 2.77 130.7 131.0
08 Rajasthan 6.63 135.6 135.7 4.23 130.1 130.3 5.51 133.6 133.8
09 Uttar Pradesh 14.83 132.3 131.8 9.54 128.9 128.9 12.37 131.1 130.8
10 Bihar 8.21 135.7 135.4 1.62 128.2 126.6 5.14 134.6 134.1
11 Sikkim 0.06 140.5 140.4 0.03 134.7 134.4 0.05 138.6 138.4
12 Arunachal Pradesh 0.14 140.3 140.7 0.06 0.10
13 Nagaland 0.14 141.8 142.9 0.12 128.5 129.0 0.13 136.1 137.0
14 Manipur 0.23 129.6 133.6 0.12 125.9 127.3 0.18 128.4 131.6
15 Mizoram 0.07 132.3 132.9 0.13 124.5 124.7 0.10 127.5 127.9
16 Tripura 0.35 140.0 139.9 0.14 132.6 134.7 0.25 138.1 138.6
17 Meghalaya 0.28 135.3 134.8 0.15 125.0 124.8 0.22 132.1 131.7
18 Assam 2.63 129.7 129.6 0.79 128.1 128.0 1.77 129.4 129.3
19 West Bengal 6.99 134.4 133.6 7.20 129.7 129.2 7.09 132.2 131.5
20 Jharkhand 1.96 138.9 138.1 1.39 128.3 127.8 1.69 134.9 134.2
21 Odisha 2.93 139.7 138.6 1.31 127.2 126.9 2.18 136.2 135.3
22 Chhattisgarh 1.68 139.1 138.3 1.22 127.8 127.2 1.46 134.7 134.0
23 Madhya Pradesh 4.93 129.7 129.6 3.97 128.1 128.6 4.48 129.0 129.2
24 Gujarat 4.54 136.0 135.8 6.82 125.8 125.1 5.60 130.2 129.7
25 Daman & Diu 0.02 144.7 147.4 0.02 129.4 128.7 0.02 138.3 139.6
26 Dadra & Nagar Haveli 0.02 137.1 136.1 0.04 124.6 124.7 0.03 128.8 128.5
27 Maharashtra 8.25 134.6 134.8 18.86 125.1 124.8 13.18 128.3 128.1
28 Andhra Pradesh 5.40 137.5 136.6 3.64 131.7 131.4 4.58 135.4 134.7
29 Karnataka 5.09 134.6 134.2 6.81 134.9 134.8 5.89 134.8 134.5
30 Goa 0.14 142.0 142.9 0.25 126.3 126.0 0.19 132.4 132.5
31 Lakshadweep 0.01 129.3 127.9 0.01 119.0 113.7 0.01 124.0 120.6
32 Kerala 5.50 130.5 130.8 3.46 131.3 131.1 4.55 130.8 130.9
33 Tamil Nadu 5.55 131.2 131.0 9.20 130.7 130.9 7.25 130.9 130.9
34 Puducherry 0.08 138.2 137.5 0.27 129.5 129.1 0.17 131.7 131.2
35 Andaman & Nicobar Islands 0.05 136.2 136.7 0.07 125.6 125.9 0.06 130.8 131.2
36 Telangana 3.16 135.0 135.1 4.41 130.2 130.4 3.74 132.4 132.5
99 All India 100.00 133.8 133.6 100.00 128.6 128.4 100.00 131.4 131.2

Notes:  1. Prov. : Provisional.

2.–: indicates the receipt of price schedules is less than 80% of allocated schedules and therefore indices are not compiled.

Annexure IV

Major State/UT wise annual inflation rates (%) for November 2016 (Provisional)

(Base: 2012=100)

Major State/UT wise annual inflation rates (%) for November 2016 (Provisional)

(Base: 2012=100)

State/UT Code Name of the State/UT Rural Urban Combined
Nov. 15 Index
(Final)
Nov. 16

Index
(Prov.)

Inflation Rate
(%)
Nov. 15 Index
(Final)
Nov. 16

Index
(Prov.)

Inflation Rate
(%)
Nov. 15 Index
(Final)
Nov. 16

Index
(Prov.)

Inflation Rate
(%)
(1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11)
01 Jammu & Kashmir 126.5 134.5 6.32 123.2 125.2 1.62 125.3 131.2 4.71
02 Himachal Pradesh 127.3 134.0 5.26 119.5 124.9 4.52 125.9 132.4 5.16
03 Punjab 123.7 129.9 5.01 123.4 126.7 2.67 123.6 128.5 3.96
05 Uttarakhand 123.2 128.7 4.46 119.8 121.9 1.75 121.9 126.2 3.53
06 Haryana 124.9 131.8 5.52 121.4 124.5 2.55 123.3 128.4 4.14
07 Delhi 122.5 129.0 5.31 124.7 131.1 5.13 124.6 131.0 5.14
08 Rajasthan 128.9 135.7 5.28 125.1 130.3 4.16 127.5 133.8 4.94
09 Uttar Pradesh 127.2 131.8 3.62 125.3 128.9 2.87 126.5 130.8 3.40

Demonetisation, GST roll-out will help Indian economy in the long run: S&P

Livemint:  December 14, 2016

New Delhi: Indian banks and companies face short-term downside risks due to the cash crunch arising from the government’s decision to invalidate old high-value currency notes, but the move will be beneficial for the Indian economy in the long run, global rating agency S&P said on Wednesday.

“Indian government reforms will have long-term structural benefits but carry short-term execution and adjustment risks,” S&P Global Ratings credit analyst Abhishek Dangra said in an article titled India’s Demonetization And The GST: Short-Term Pain For Long-Term Gain.

It pointed out that the Narendra Modi government’s decision to demonetise Rs500 and Rs1,000 currency notes with effect from 9 November had led to a significant cash crunch in the economy.

S&P expects both demonetisation and the goods and services tax (GST) to adversely impact some sectors of the economy in the short run but have long-term benefits. It had recently revised it’s growth forecast for India to 6.9% in 2016-17 from 7.9% earlier.

“Both the demonetisation and a goods and service tax (GST) expected to be implemented by September 2017 are likely to have a higher disruptive impact on the informal, rural, and cash-based segments of the economy,” it said.

However, in the long run, demonetisation and the GST could result in a wider tax base and greater participation in the formal economy. This should benefit India’s business climate and financial system in the long run, the rating agency said.

S&P says that as per it’s base case scenario, the disruption from demonetisation should be short-lived with demand revival in the next one to two quarters, limiting the impact on Indian banks and corporates.

However, in the short term, the rural and informal sectors of the economy are experiencing large-magnitude adjustments. Business sectors that often transact in cash, including jewelry and real estate, will also face some degree of upheaval, S&P said.

It added: “In a less-likely downside scenario, the shock of demonetization will not be absorbed within the next few months and the economic disruption will spill over into fiscal 2018, and potentially coincide with the introduction of the GST. Economic growth will stay lower for longer, raising stress levels on corporates, banks, and other financial institutions; although the sovereign rating is likely to remain resilient.”


7378 million units of Electricity, Rs. 4866 crore saved through energy efficiency measures in 2015-16

Press Information Bureau:  December 14, 2016

The Union Minister of State (IC) for Power, Coal, New & Renewable Energy and Mines, Shri Piyush Goyal, will inaugurate the National Energy Conservation Day here on December 14 and felicitate winners of National Energy Conservation Awards and National Energy Conservation Painting Competition 2016.

The participating entities for the 2016 energy awards have collectively invested Rs.5111 crore in energy conservation measures and achieved monetary savings of Rs. 4866 crore in a short period of 13 months. The investment will continue to pay in the coming years as well. These entities have also saved 7378 million units of electricity, which is equivalent to the energy generated from a 1352 MW thermal power plant.

Spearheaded by the Bureau of Energy Efficiency (BEE), Ministry of Power, the awards recognise industrial and other establishments which have taken effective measures to conserve energy, and students from across the country who paint ideas for energy conservation. A large number of Industrial units, office & BPO buildings, hotels , hospitals, zonal railways, railway stations including metro stations, state designated agencies, municipalities, manufacturers of BEE star labelled appliances, thermal power stations, universities and other Institution buildings, electricity distribution companies (DISCOMs), financial institutions and state road transport corporation & undertakings sent in their entries for Energy Conservation Awards aimed at recognising effective energy efficient technologies and practices.

Shri Piyush Goyal will interact, through video conferencing, with school students across the country and view their paintings depicting exciting ideas on energy conservation. He will also share with students his own ideas on the subject. This year, more than 1.14 crore students from across the country participated in the school painting competition, which is 8% higher than the last year.

Besides presenting the painting competition prizes, Shri Goyal will also present National Energy Conservation Awards 2016 – 3 Top Rank Awards, 43 First Prizes, and 48 Second Prizes to establishments for best energy conservation technologies and practices.

 

CERC admits IEX plea seeking launch of renewable energy contracts

Business Standard:  December 14, 2016

The Central Electricity Regulatory Commission (CERC) has admitted the petition filed by the Indian Energy Exchange (IEX) for the introduction of green power (renewable energy) contracts. IEX plans to introduce green day-ahead market based on collective transactions, comprising solar day-ahead contract and non-solar day-ahead contract, which will be applicable for merchant capacity.

According to IEX, renewable energy generators will get payment based on schedules and buyers will get more options to buy renewable power. This apart, renewable-rich states can sell power to renewable-deficit states, helping the latter meet their renewable purchase obligation (RPO).

IEX is currently operating the day-ahead market and term-ahead market in the electricity segment and the renewable energy certificate market. Its daily turnover is 113 million units in the day-ahead market. The average market-led electricity price was Rs 2.32 per unit for November.  CERC has asked IEX to implead the Power Exchange India and the PowerGrid Corporation of India’s wholly owned subsidiary Power System Operation Corporation as parties to the petition. CERC has slated the next hearing on IEX petition on January 24, 2017.


Bally eyes India comeback in joint venture with Reliance

Livemint:  December 14, 2016

Mumbai: Switzerland’s 165-year-old luxury brand Bally is returning to India in a joint venture with Reliance Brands Ltd, with plans to open its first store at the DLF Emporio mall in New Delhi in March 2017.

Under the terms of their agreement, the joint venture will invest in building a world class retail experience by investing in training of staff and opening stores.

Bally is the latest addition to the Reliance Brands portfolio which includes Steve Madden, Thomas Pink, Brooks Bro’s, Diesel and Super Dry. The company will establish a network of stand-alone Bally stores across major Indian cities.

“In the future, India is the most important country for us. We want to invest and develop the brand in India,” said Frédéric de Narp, chief executive officer of Bally who took charge in November 2013 to turn it around. “Part of this turnaround strategy is the joint venture in India,” said de Narp, who is credited with the successful turnaround of American jeweller and watchmaker Harry Winston Inc.

Bally first entered India in a franchise partnership with Bird Group, which has interests in travel technology, hospitality and aviation. It had two stores in India, one at the Palladium mall in Mumbai and the other at DLF Emporio Mall. Both these stores have closed in the past two years. The partnership was ended earlier this year.

This time round the company has spent a few years finding the right partner and fine-tuning its strategy for India. “We have been working in developing this joint venture by developing the trust for the last few years,” said de Narp, adding that more importantly, the joint venture is with Reliance, a profitable company and a reliable retailer.

In India, Bally will sell its entire range across men’s and women’s footwear and accessories. The new store will be part of the brand’s global expansion which has seen the opening of two new concept flagships in Tokyo’s Ginza and Los Angeles’ Rodeo Drive this year. The joint venture will open four stores in Delhi, Mumbai, Kolkata and Chennai in the next 3-4 years, said Darshan Mehta, chief executive officer, Reliance Brands.

In its previous partnership, Bally which is part of JAB Holding Company, a privately held group known for its brands like Jimmy Choo, Krispy Kreme and Belstaff globally, “had underestimated the challenges in investing in India,” admits de Narp. “Franchise is a challenging model,” he added. De Narp is looking at investing this time to build a healthy and sustainable business in India.

To be sure, a majority of international retailers that have launched operations in India have come through the franchise route in the last 4-5 years, said Devangshu Dutta, chief executive officer, Third Eyesight, a retail consultancy firm. “Franchise model is a low-risk approach for a retailer who is not entirely sure about the market. It is about experimenting and exploring the market,” said Dutta, adding, “However, once they have committed they prefer to invest.”

 


Norway wealth funds hoping to expand footprints in India

Economic Times:  December 14, 2016

New Delhi: The 90-odd Norwegian companies including wealth funds operating in India find the business climate in India favourable with many of them looking to increase footprints in the near future.

According to the first ever Business Climate Survey conducted by the the Norwegian Business Association India (NBAI) and Norwegian Consulate in Mumbai, in collaboration with Innovation Norway, the commercial section of the Norwegian Embassy in Delhi, 62 per cent of the companies found the business climate in India favourable.

The survey was conducted to assess the current and near future business climate for Norwegian companies with specific focus on the maritime sector. There are around 90 Norwegian companies operating in India, the largest ones among them being Telenor, DNB, Aker Solutions, Kongsberg, Jotun, Statkraft Norfund Power, Det Norske Veritas and Elkem.

According to the survey, 59 per cent of these companies are looking to increase their workforce by at least 20 per cent next year.

“Telecom, oil and gas, manufacturing, consulting, maritime and marine (fisheries) form the backbone of Norway’s economy,” Norwegian Ambassador to India Nils Ragnar Kamsvag said.

According to Richard Chapman, Chairman of NBAI, Norway has the fifth-largest merchant fleet in the world. “They are here for two reasons — crewing and service,” he said

Kamsvag also said that the Norwegian State Pension Fund is the biggest sovereign wealth fund “and is one of the biggest foreign investors in India”.

According to the survey, the maximum opportunities in India for Norwegian companies lie in the areas of equipment supplies (83 per cent), ship design (75 per cent) and navigation systems (71 per cent).

The Indian government, giving infrastructure status to ship-building has also got Norwegian companies interested.

“Most of our investments are technology-driven, like oil and gas out at sea in difficult waters and technology for deep-sea drilling,” Kamsvag said.

According to Chapman, Norway, where hydropower is almost 100 per cent of all power generated, can help India in this sector. He said Statkraft Norfund Power, Norway’s largest power generation company, already has a joint venture with Tata Power.

The NBAI chairman said that Norway can help in water supply, sewage and waste disposal and recycling. “Recycling is an area of expertise. What we are looking at (in India) is smart cities,” he said.

 

The Swedish newspaper was recently asked it to delete the reference made by President Pranab Mukherjee to the Bofors scam in an interview to it, as a claim protested by the Indian Government on 27 May 2015. India has expressed disappointment over the disrespect shown to the President, the newspaper has defended its right to publish what was said during the interview.

Know, who is Vijay Kelkar and what is PPP !

Vijay Kelkar is a renowned economist and a former Finance Secretary. He was appointed head of newly constituted committee to give recommendations to recast the model of Public-Private-Partnership (PPP) model in India. India is one of the largest PPP market with over 900 projects. The Kelkar committee will review the PPP policy, suggest a better risk-sharing mechanism between private developers and the government after analysing such projects.

Know, who is Yaduveer Krishnadatta Chamaraja Wadiyar !

Yaduveer Krishnadatta Chamaraja Wadiyar was crowned as the new Maharaja of of Mysuru (Mysore) royal family. He is the 23-year old grandson of Princess Gayathri Devi, who was the eldest daughter of the last Maharaja of Mysore, Sri Jayachamarajendra Wadiyar. The coronation was held at Mysuru’s famous Amba Vilas Palace, which was decked up for the occasion.

Know about Sepp Blatter!

Swpp Blatter, was re-elected as FIFA president for a fifth term at the 65th Annual Congress of FIFA held at Zurich for four year term.

Prince Ali bin al-Hussein of Jordan stood against Blatter in this election. It is worth mentioning that FIFA is going through a major controversy regarding corruption in the organisation with two FIFA vice presidents and a recently elected FIFA executive committee member still in custody.

 


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