The Reserve Bank may cut the benchmark short-term lending rate by about 0.25 per cent in its annual monetary policy next month in the backdrop of declining inflation and the urgency to promote growth, say economists.
“Right now conditions should enable the RBI to cut repo rate. We expect a cut of 25 basis points (or 0.25 per cent) in its policy in May and may be by another 25 bps in the next review,” HDFC Bank Chief Economist Abheek Barua said.
RBI Governor D Subbarao will announce the Monetary Policy Statement 2013-14 on May 3, 2013.
YES Bank Chief Economist Shubhada Rao said RBI may cut the repo rate or the short-term lending rate by about 0.25 per cent in May as inflation has come down and there is a need to fuel economic growth.
“Taking cue from inflation, we believe that RBI could take this time...To cut rate, particularly, the way we have seen inflation in the past coming down. Given the strong deceleration in growth, we think RBI may cut repo rate by 0.25 per cent in May as well as may provide some liquidity easing,” Rao said.
Wholesale prices (WPI), a measure of inflation, softened to 5.96 per cent in March after an annual rise of 6.84 per cent in February, the lowest rate since November 2011.
“If you look at the incremental data WPI, IIP in the last two months, that data is in favour of the 25 basis points rate cut. We are expecting a cut in repo rate in May,” Anubhuti Sahay, Economist, Standard Chartered Bank said.
Industry has been batting for a rate cut to tide over the problems concerning poor demand, low industrial output and subdued economic growth.
The Index of Industrial Production (IIP), the key gauge to measure industrial activity, slumped to 0.6 per cent in February from 4.3 per cent a year ago because of poor performance in manufacturing coupled with contraction in power generation and mining output. PTI
ly, IIJbCl8IJ IJnIJ ted a jump in its ARPU from `148 in the second quarter FY12-13 to `158 in the third quarter.
Airtel recorded a 4 per cent sequential growth in ARPU at `185 in the third quarter FY12-13, up from `177 in the second quarter and Vodafone’s ARPU jumped to `182 in the from `174.
Meanwhile, as a number of telecom operators like Uninor, MTS and other have withdrawn services in certain circles, requests for mobile number portability have also increased sharply. By the end of February 2013 about 86.83 million subscribers have submitted their requests to different service providers for porting their mobile number.
IJIJl IJIJ IJIJ in December 2012 after Environment Ministry had withdrew Stage II clearance for the project and suspended Stage I clearance – the underlining aspect remains that local interests can’t be undermined at any cost.
“Whatever be the concerns of the local population, they have to be kept in mind by those who are starting projects. It should be seen that questions being raised by the affected parties are not ignored while initiating ambitious ventures,” said Arvind Mahajan, Partner for Advisory practice and Head of Energy & Natural Resources and Global Infrastructures practices of KPMG in India.
Industry watchers echoed similar sentiments, saying that increasingly it has been noticed that concerns of those at the grass-root level are taken for granted by entrepreneurs and later on these neglected issues snowball into major obstacles for such ambitious projects.
South Korean Steel major POSCO’s ambitious steel project in Odisha’s Jagatsinghpur district, which was originally envisioned in 2005 to be a 12 million tonnes capacity venture with an investment totaling $12 billion, is yet to take off mainly owing to issues to land acquisition.
Acquiring land for this project became a problem as local tribals and villagers literally stuck to their ground, refusing to part with their lands. Subsequently the project had to be downgraded after reconciliation was reached to acquire 2,700 acres of land, considerably down from the originally planned 4,000 acres. Resultantly it was decided by the project management that they will now produce 8 million tonnes per annum from the proposed steel plant.
In case of Vedanta’s lanjigarh refinery project also, while the plan was to expand it from the existing 1 million tonnes per annum capacity to 6 million tonnes per annum, due to the issues related to the site from where it plans to mine bauxite for the project, its future now lies in the hands of the Kalahandi Gram Panchayat.