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NEWS FEATUREIndia population to outnumber China's in 2022: UN There will be more Indians than Chinese by 2022 when both Asian giants will have 1.4 billion peopleeach and India's population will grow at a faster pace, according to the UN.

Bengaluru firm buys out Swiss gold refinery for $400 mnCity-based Rajesh Exports Ltd on July 27 announced acquiring Swiss gold refinery Valcambi for Rs.2,569crore ($400 million) in all cash deal from Newsmont and a group of investors.

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GM drives out of Halol, to invest $1 bn in Talegaon by 2020General Motors, the world’s second-largest automaker, plans to invest $1 billion in India by 2020. The an-nouncement follows the company’s decision on July 28 to invest $5 billion in global growth markets likeBrazil, China, Mexico and India.


Uber to invest $1 billion in IndiaTaxi hailing service Uber Technologies Inc. will invest as much as $1 billion in India within the next sixto nine months, signalling its ambition to catch up with local rival Ola and become the dominant taxiservice app in the country.

OVERSEAS INVESTMENTS

ITP Division Ministry of

External Affairs Government of India

Issue No 634 I July 28-August 3, 2015

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TRADE NEWSPower Finance Corp stake sale fully subscribedThe government's 5 percent stake sale on July 27 in the Power Finance Corp (PFC) was fully subscribedwith robust response from both institutional as well as retail investors for 13.22 crore shares as against theoffer for 6.6 crore shares.


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SECTORAL NEWSIndian railways start online survey on preference of bedrollsWith a view to improving passenger amenities and services, the Indian Railways Ministry has started an onlinesurvey on consumers’ preference of bedrolls which will cover aspects from cleanliness and hygienic conditionsto their colour and design choice.


NEWS ROUND-UPHero to acquire EBR's consulting businessThe American unit of Hero MotoCorp Ltd, India’s largest two-wheeler maker, has entered into a settlementagreement to acquire bike maker Erik Buell Racing’s (EBR) consulting business for $2.8 million, the companysaid on July 28.


WEEKLYECONOMIC BULLETIN

WEEKLYECONOMIC BULLETIN 2

Issue no 634 I July 28-August 3, 2015

>> NEWS FEATURE

India population to outnumber China's in 2022: UN There will be more Indians than Chinese by 2022 when both Asian giants will have 1.4 billion people each and India'spopulation will grow at a faster pace, according to the UN.

A report from the UN Department of Economic and SocialAffairs on Wednesday said that in seven years, "India's popu-lation is projected to continue growing for several decades to1.5 billion in 2030 and 1.7 billion in 2050, while the populationof China is expected to remain fairly constant until the 2030s,after which it is expected to slightly decrease".

A similar UN report two years ago had projected that thepopulation of each of the two countries would reach 1.45 bil-lion in 2028 when India's would start to grow at a faster pacethan China's.

The report issued periodically to update population projectand the latest is called "World Population Prospects: The2015 Revision".

It projects world's population current population of 7.349 billion to grow by over a billion to 8.5 billion over the next 15years and reach 9.725 billion by 2050.

India's bigger population initially gives it the economic advantage of a demographic dividend or benefit from the in-creased productivity of the youth, but it will also put a greater stress on the resources of India's area of 3.288 million sqkilometres compared to China's 9.597 million sq kilometres.

India will also have to rev up its economy to create jobs for millions more and, therefore, Prime Minister NarendraModi's has set a target of creating 100 million jobs by 2022 and emphasising the manufacturing.

Although India's population will continue to grow, paradoxically the median age of Indians will increase because of theslowing fertility rate, eroding the demographic dividend. The median age now at 26.6 is expected to rise to 31.2 in 2030,to 37.3 in 2050 and 47 in 2100, the report said.

The fertility rate or the number of children born to a woman is currently 2.48 and is expected to go down to 2.34 by2020, to 2.14 by 2030 and to 1.89 by 2050, according to the report.

Population experts consider a fertility rate of 2.2 children per woman as the replacement rate, that keeps the popula-tion constant over the long range.

Source: Indo-Asian News Service

WEEKLYECONOMIC BULLETIN >> NEWS FEATURE3


City-based Rajesh Exports Ltd on July 27 announced acquiring Swiss gold refinery Valcambi for Rs.2,569 crore ($400 million)in all cash deal from Newsmont and a group of investors.

"We have raised 70 percent of the fund for acquisition by our Singapore-based subsidiary through internal accruals and 30percent from debt," Rajesh Exports chairman Rajesh Mehta told IANS here.

Touted to be the world's largest yellow metal refining firm, the five-decades-old Valcambi processed and sold 945 tonnesof gold and 325 tonnes of silver per annum over the last three years.

It generated $38 billion revenue and $33 millionEbitda (earnings before interest, tax, depreciation andammortisation in calendar year 2014.

"The acquisition makes us the country's largest goldprocessing and refining firm with a combined produc-tion capacity of 2,200 tonnes per annum, including1,255 tonnes in our Bengaluru units," Mehta said.

Post-acquisition, Rajesh Exports will manage Val-cambi, owned by Newsmont Mining Corporation and agroup of Swiss investors over the last 50 years.

"Synergies between our two entities will increase ourrevenues and profits and the acquisition will be EPS(earnings per share) accretive," Mehta said.

Accredited to the London Bullion Market Association, Valcambi's gold bars are accepted for its quality in leading commod-ity exchanges in Chicago, New York, Tokyo, Dubai and Mumbai.

"Valcambi is a zero debt firm with significant cash surplus on its balance sheet," Mehta added.Newmont is one of the world's biggest gold and copper mining firm and is a part of the Standard & Poor (S&P) 500 Index

on New York stock exchange.Valcambi chief executive Michael Mesaric, an authority in gold industry, and its management will be part of Rajesh Ex-

ports, which will become an integrated player in gold refining and jewellery-making."More than the price of sale, my aim was to deliver the firm to a buyer who would maintain Valcambi's world class stan-

dard and stature," Volcambi founder Emilio Camponovo said in a statement from Geneva.Mesaric said the combined entity would improve its global share of gold business by opening new markets in India, the

Gulf region and China."We will focus on forward integration and innovative products in the European markets by using the domain expertise of

Rajesh Exports," he said.Mehta said Valcambi's the acquisition would make India not only the largest gold consumer, but also a leading producer of

the yellow metal to meet the growing requirement of the country in the sub-continent.Source: Indo-Asian News Service

Bengaluru firm buys out Swiss gold refineryfor $400 mn

WEEKLYECONOMIC BULLETIN >> NEWS FEATURE4


The government on July 27 reported that the national passenger carrier Air India's net loss has come down by over 26 per-cent since the implementation of turnaround plan (TAP) during 2011-12.

Minister of State for Civil Aviation MaheshSharma informed the Lok Sabha that the net lossof the company during 2014-15 stood atRs.5,547.40 crore down from Rs.7,559.74 crore in2011-12.

"The company has achieved the targets set outin the TAP and has made substantial progress inboth operational as well as financial areas," theminister said in a written reply.

According to the minister, the operating lossesreduced to Rs.2,171.40 crore in 2014-15 fromRs.5,138.69 crore in 2011-12.

"The company has turned EBIDTA (earningsbefore interest, tax, depreciation and amortisation) positive by Rs.541.60 crore as against the negative EBIDTA of Rs.2,236.95crore in 2010-11," the minister said.

The minister added that the total revenue of the airline increased by 33.25 percent to Rs.4,026.31 crore as compared tolevels of 2011-12.

"The total revenue during 2014-15 is Rs.19,718 crore as against Rs.14,713.81 crore in 2011-12," the minister added.The passenger oad factor which is a key indicator of the airlines performance improved to 73.1 percent in 2014-15 from

67.9 percent in 2011-12.Source: Indo-Asian News Service

Air India's net loss down over 26 percent sinceTAP implemented

WEEKLYECONOMIC BULLETIN 5


>> OVERSEAS INVESTMENT

Taxi hailing service Uber Technologies Inc. will invest as much as $1 billion in India within the next six to nine months, sig-nalling its ambition to catch up with local rival Ola and become the dominant taxi service app in the country.

Since launching in India in August 2013, Uber has slashed prices, introduced low-cost services and even accepted cashpayments to adapt its lean business model to India and Indians. Uber is the biggest threat to local rival Ola, run by ANITechnologies Pvt. Ltd.

Uber, an app-only service, said on Thursday thatit is growing at a rate of 40% month-on-month inIndia. With the increased investment in product, hir-ing and payment solutions, the company expects todo more than one million daily rides in the next six-nine months, according to Amit Jain, who was ap-pointed president of Uber India in June. Thecompany declined to say how many rides it is doingcurrently.

“We are extremely bullish on the Indian marketand see tremendous potential here. We have grownexponentially in India, a global priority market forus, that has also quickly become the largest marketgeographically for Uber outside the US. We’re com-mitting an additional $1 billion to India in the next six-nine months so we can expand and improve our operations, grow intonewer cities, develop new products as well as payment solutions, and establish a great support network,” Jain said in anemailed statement. Uber’s $1 billion cash infusion indicates the company will compete more aggressively with Ola, whichboosted its leadership position by buying smaller rival TaxiForSure in a $200 million deal in March. Though Ola is currentlythe clear market leader, Uber’s technology expertise and massive war chest may help the company cut the lead of its localrival and trigger another price war among taxi services.

Ola is close to raising $500 million at a valuation of $5 billion from existing investors that include SoftBank Group, TigerGlobal Management Llc and Sequoia Capital, The Economic Times reported on 28 July. Mint reported the talks first on 21May. Uber soft-launched in India in August 2013 and started a full-fledged service two months later with much fanfare, of-fering expensive rides in the Mercedes-Benz S-Class and other luxury cars, charged to customers through direct, auto-matic deductions on their credit cards stored in the app.

Taxi services led by Ola and Uber are experiencing a boom in demand in a country where transport infrastructure is stillcreaky, and safe public and private commuting options are few. A shift in consumer habits towards convenience and on-de-mand services and, most crucially, low prices, has fuelled the surging demand.

San Francisco-based Uber is set to become the world’s most valuable start-up as it closes on a new round of financingat a value of $50 billion, according to media reports.

Source: Mint

Uber to invest $1 billion in India

WEEKLYECONOMIC BULLETIN >> OVERSEAS INVESTMENT6


GM drives out of Halol, to invest $1 bn inTalegaon by 2020General Motors, the world’s second-largest automaker, plans to invest $1 billion in India by 2020. The announcement followsthe company’s decision on July 28 to invest $5 billion in global growth markets like Brazil, China, Mexico and India.

The fresh investment will be used primarily to expand the capacity atthe Talegaon plant from 130,000 units a year to 220,000 by 2025. “GMcannot remain a global leader without making a serious investment in ex-panding presence in growth markets like India,” Chief Executive MaryBarra said.

The company had invested $1 billion in the country since 1996, whenthe Halol (Gujarat) plant was set up, but its Indian operations remainedmarred by losses.

India’s eighth-largest automaker on Wednesday also announced itsplan to shut its Halol plant and expand capacity at the Talegaon facility inMaharashtra. The Halol unit had earlier faced labour unrest on two occa-sions — first, in 2010, when workers went on a strike that lasted threedays; and second in March 2011, when their strike went on for six weeks.

A senior official from Maharashtra Industrial Development Corporation told Business Standard the GM CEO was scheduledto meet Chief Minister Devendra Fadnavis on Thursday to make the company’s proposal to expand capacity at its Talegaonplant. The proposed expansion is for exports, for which Talegaon has good infrastructure and ecosystem.

Maharashtra Industries Minister Subhash Desai said: “GM’s decision to expand its Talegaon site proves Maharashtra is thepreferred investment destination for global players.”

GM has a market share of 1.8 per cent in India and is the eighth-largest player here. Its announcements follow a meeting ofBarra and company president Stefan Jacoby with Prime Minister Narendra Modi in

New Delhi. This is Barra’s second visit to India since Modi took charge in May last year. She had last come to India and metModi in September 2014.

Barra said the company was restructuring and consolidating its Indian operations to have a sustainable business.She, however, did not specify a timeline by when the company is expecting to turn its Indian operations profitable. The new investments, the company claimed, would create 12,000 new jobs for GM and its suppliers in India. Despite expan-

sion at Talegaon, the company’s India capacity will decline from 280,000 at two plants to 220,000 at one after restructuring.Operations at the Halol plant, which has a capacity of 110,000 units a year, will be stopped from the second half of 2016.

This plant employs 1,100 workers.Jacoby said the company was working hard to find an alternative solution to Halol. According to the company, Halol’s 1,100

employees will have the option of applying for roles at the Talegaon plant. Temporary workers say contracts of nearly 250 ofthem have not been renewed this year. However, Nihil Mehta, president, Gujarat wing, Indian National Trade Union Congress(Intuc), says: “Workers at Halol will be paid only their basic wages, void of allowances. This is basically asking them to leave. Ifsomeone decides to stay back till June 2016, he or she would either be eased off with a month’s pay or transferred to the com-pany’s Talegaon plant near Pune.” Workers are contemplating legal action.

As for its India plans, GM said it would launch a completely new product portfolio by 2020 and the oldest vehicle then wouldbe less than three years old.

It would produce 10 vehicles locally over the next five years, beginning with the SUV Trailblazer in October this year. It alsoplans to launch its multipurpose vehicle Spin in early 2017.



“The Indian market is expected to grow to eight million units by 2025. We want to be part of this growth”, Barra said. GM alsoaims to export up to 30 per cent of its production from India over the next decade. Last year, it exported just four per cent of itsproduction. It categorically said there was no plan to export Indian products to mature markets like the US.

Jacoby said the day’s announcement marked the beginning of a new GM in India, adding the company would change its wayof doing business here.

Growth, however, would not come easy for GM as competition in the multi-player Indian market will further hot up. GM’s operations have been hit by issues like large recalls. Early this month, it announced its biggest recall in India, of 155,000 units of the Spark, Beat and Enjoy, manufactured be-

tween 2007 and 2014, to address a potential safety issue related to remote keyless entry accessory. GM had earlier recalled 114,000 units of its sports utility vehicle, Tavera, in July 2013.Arvind Saxena, president & managing director of GM’s India operations, said the company had not done a good job in the past. “We are committed to fixing that. We are changing our behaviour”. GM’s sales volume declined sharp 36 per cent in 2014-15,

while the industry grew four per cent. Sales also declined in the April-June, by 36 per cent, even as the industry grew over sixper cent.

Source: Business Standard



India on Obama's list of US investmentsabroadIndia is very high on the US list for investments in foreign countries as economic growth across the world remains a priority forPresident Barack Obama, according to the White House.

"In terms of the US-India partnership, ...the president isvery enthusiastic about the prospect of increased collabo-ration, increased economic growth for American compa-nies, and investments in India," press secretary EricSchultz told reporters Wednesday.

"I think you heard that from his recent trip there a fewmonths ago," he said when asked if Vice President JoeBiden was carrying a message from Obama at a recentconference where it was revealed that Indian companieshad invested $15 billion in the US and created over100,000 jobs in the US.

"But just because he is not over there right now, thatdoesn't mean we don't have key members of our teamworking on this," Schultz said.

"So economic growth across the country remains --across the world, remains a priority for this president andoftentimes that manifests itself in investments in foreign countries," he said. "And India is very high on that list."

Asked how the US Export-Import Bank is playing a role in US-India trade relations, Schultz said he didn't "have specifics onhow any specific loans or support structures that Ex-Im has offered American companies, specifically for business in India".

"I think generally speaking, the reason that Republicans and Democrats support Ex-Im Bank is because it is an engine of eco-nomic growth and American jobs for American companies here at home," he said.

Schultz comments on the Export-Import Bank came after the Republican controlled House of Representatives passed ahighway funding bill without a measure to reauthorise the US's export credit agency.

Conservatives in the House have opposed the move to renew the Ex-Im Bank's charter expiring on July 31, calling it a symbolof corporate welfare.

Ex-Im, which is supported by the US Chamber of Commerce and major corporations such as Boeing and General Electric,provided $27.4 billion in financing to support US exports in fiscal year 2014, according to the credit agency.

Source-Indo-Asian News Servcice

9

WEEKLYECONOMIC BULLETIN >> TRADE NEWS


Power Finance Corp stake sale fully subscribedThe government's 5 percent stake sale on July 27 in the Power Finance Corp (PFC) was fully subscribed with robust responsefrom both institutional as well as retail investors for 13.22 crore shares as against the offer for 6.6 crore shares.

The government has set a floor price at Rs.254 per eq-uity share for divestment of 5 percent of its stake in PFC, ithad said in a stock exchange filing on Saturday.

The government holds 72.80 percent equity in the com-pany, while the stake sale is expected to garner aroundRs.1,600 crore.

The floor price of Rs.254 is at a discount of 2.14 percentover Friday's closing price of the stock at Rs.259.55.

PFC stake sale would be the second such sale this fis-cal by the government after divesting stock in REC in April.

It is the first disinvestment under the modified offer forsale (OFS) rules of markets regulator Sebi under whichcompanies are allowed to disclose stake sale plans twobanking days ahead of the issue.

Earlier, companies were required to give an advance no-tice of two trading days before the OFS, which, the govern-ment says, gave scope for speculators to beat down the share price of the undertaking up for divestment.

The government has an ambitious disinvestment target of Rs.41,000 crore through stake sale in public sector units, and an-other Rs.28,500 crore through strategic stake sale by transfer of management control, during the current fiscal.

PFC stock closed on Monday at Rs.254.05 a share, down 5.50 points, or 2.12 percent, over its previous close on the BombayStock Exchange (BSE).


WEEKLYECONOMIC BULLETIN >> TRADE NEWS 10


New Centre-state council to give boost to exportsWith exports shrinking since December last year, the Modi government on July 14 said it will shortly operationalise a Trade Fa-cilitation Council (TFC) comprising members of the Centre and states to boost overseas shipments and urged state govern-ments to soon bring out their respective trade policies.

Among other measures in the offing to promote ahealthy competition between states on the foreign tradefront is the release of state-wise exports data on a regularbasis, according to an official.

Already, 14 states including Gujarat and MadhyaPradesh have framed export strategy/policy, and 21 stateshave appointed export commissioners to ensure ease ofcarrying out foreign trade and expedite the development ofinfrastructure.

The council will be headed by commerce and industryminister Nirmala Sitharaman, the concerned ministersfrom the state governments and secretaries of key min-istries/departments.

Commerce secretary Rita Teaotia will discuss withstate government officials on July 15 ways to ensuregreater involvement of state governments in the country’s export promotion strategy.

The meeting will also take up issues related to the exports sector including the regulatory environment in the states, and in-frastructure problems including electricity availability as well as road and telecom network.

Issues of local taxes and its refund will also figure in the discussion. The commerce ministry is also in discussion with states regarding a list of infrastructure projects that can help boost ex-

ports.Shipments contracted — for the sixth consecutive month — in May by (-)20.19% to $22.35 billion due to softening of crude oil,

metal and commodity prices besides weak demand in major overseas markets such as China, the OPEC and Eurozone, a rela-tively stronger rupee and domestic bottlenecks.

The government is aiming to help the country meet $900 billion exports target by 2019-20.The focus areas for the government include project exports, spices, defence and hi-tech items, besides the services sector. It

is also aiming to revive investment inflow into special economic zones and boost exports from these enclaves.Source: The Financial Express

WEEKLYECONOMIC BULLETIN >> TRADE NEWS 11


Saarc chamber pushes for seamless regional energy tradeThe top industry chamber for South Asia has called for a public-private forum to promote seamless energy trade in the region,the freedom for transit of hydrocarbons via pipelines and the extension of most-favoured nation status between and among thecountries.

Wrapping up a conference on clean environment, cli-mate change and water conservation in Paro, the SaarcChamber of Commerce and Industry has came out with adeclaration that said effort must also be made to promoteforeign investment in the region in the area of energy andclean technology.

"As energy is an important issue for economic growth,we aim to increase investment in the power sector," saidSuraj Vaidya, acting president of the chamber, while alsopushing for a mechanism to resolve state-to-state or in-vestor-to-state disputes in the region.

As regards what the declaration termed as the ElectricPower Forum, the chamber said it must also include ex-perts and practitioners to promote energy trade, while promoting efficient development of energy sector facilitating the imple-mentation of priority energy projects.

According to Vaidya, the Paro Declaration desires uninterrupted power at affordable prices in the region. Voicing the opinionsof stake-holders, it said there should be three sub-grid systems in the region -- eastern, western and southern grids, pending thecoverage of entire South Asia.

The eastern grid should include Bhutan, Bangladesh, India and Nepal, the western grid can include Afghanistan, Pakistan andIndia, while the southern grid will be formed by India and Sri Lanka.

Only Maldives, which is a part of the eight-nation grouping, finds no mention.The chamber also said pacts on Saarc energy projects must push accessibility and affordability.

Source: Indo-Asian News Services

WEEKLYECONOMIC BULLETIN >> SECTORAL NEWS12


With a view to improving passenger amenities andservices, the Indian Railways Ministry has startedan online survey on consumers’ preference ofbedrolls which will cover aspects from cleanlinessand hygienic conditions to their colour and designchoice.

The ministry has uploaded a detailed question-naire on its website www.indianrailways.gov.in onbedrolls such as bed sheets, towels, pillows andblankets used during travel on trains.

“The proforma can be filled up online by August17. The questions asked in this survey include allaspects pertaining to bedrolls like cleanliness andhygienic conditions, colour preference, size prefer-ence, design preference, fabric preference, possiblecharges etc,” a release from the ministry said.

The Indian Railways have signed an MoU with National Institute of Fashion Technology (NIFT) to work on quality and designof bedrolls and related issues. The survey has been designed in consultation with NIFT.

The data collected through the survey will act as useful input in this exercise.“Consumers have been requested to spare some time and fill in the questionnaire. It has been assured that the information

so collected could be used only for research purpose and would remain private and confidential,” the release said.“The ministry has always been emphasizing on having a better connect between the railway administration and the railway

users and has been insisting on collecting passengers’ feedback on various issues with a view to improving passenger amenitiesand services in all respects,” it said.

Source: Press Trust of India

Indian railways start online survey on preference of bedrolls



Three government-owned banks postslower netThree government-owned banks - Dena Bank, Bank of Baroda and Oriental Bank of Commerce on July 30 - declaredlower net profit for the first quarter on 2015-16as compared to corresponding quarter the previ-ous year.

In a regulatory filing in BSE, Dena Bank said ithas posted a net profit of Rs.15.16 crore on atotal income of Rs.2,914.87 crore for the quarterended June 30 down from Rs.81.52 crore on atotal income of Rs.2,824.58 crore for the samequarter last fiscal.

Bank of Baroda posted a net profit ofRs.1,052.15 crore on a total income ofRs.12.243.72 crore for the quarter. In the corre-sponding period of the previous fiscal, it postedhigher net profit of Rs.1,361.88 crore on a totalincome of Rs.11,682.50 crore.

On its part, Oriental Bank posted a net profit of Rs.257.84 crore on a total income of Rs.5,568.78 crore for the quarteras against a net profit of Rs.364.54 crore on a total income of Rs.5,576 crore posted for the quarter last fiscal.




New startup 'Truckmandi' targets transport sectorA capital-based startup is making efforts to bring the still offline and unorganised transport sector online.

Truckmandi.in, which is a form of an e-com-merce service, is an online truck booking solu-tion, which simplifies the task of handling bulktransport with the help of technology. The serv-ice is available both through a website and anandroid app.

“Truckmandi came into being as we saw ahuge opportunity in a sector which is still in dis-array. The transport sector accounts for 13 per-cent of India's GDP and the market size isroughly around $130 billion," Ankit Singh, co-founder of Truckmandi, said.

"The reliability rate is also low and technologyadoption in the country is also high at this point,so we decided to open this supply demand basedlogistics service," he added.

The company, which conducts 20 transactions a day with an average ticket price of Rs.12,000, is targeting 1,500transactions by the end of the year.

Truckmandi, which also provides insurance for the goods being transported, has two models for business - the mar-ketplace and arranging trucks directly. In the marketplace model, companies can choose the transport service that arelisted in the site or app.

Truckmandi, which has a presence in Delhi NCR, Uttarakhand, Punjab and Haryana, has a average yearly turnover ofRs.12 crore.

The company is looking for raising funds to expand operations.Source: Indo-Asian News Service



Indian steel consumption likely to grow 7%: E&Y reportIndia's steel consumption is expected to grow by 7 per cent in FY16 on the back of higher economic activity against a 2per cent growth in consumption last year, according to E&Y's 'Global Steel 2015-16', a report that analyses the globalsteel sector.

At the same time steel supply is expected to in-crease by around 10 per cent in FY16, though de-mand is not expected to grow in tandem.

As a result, capacity utilization may fall below 78per cent, the report said.

To add to steel industry woes, the trend of risingsteel imports into India is expected to continue inFY16 adding to the overall situation where importshad shown an increase of 71 per cent year on year inFY15.

However, the quantum of imports may vary de-pending upon whether India raises its import duty onsteel products. In the 12th Five Year Plan, the Indiangovernment intends to invest about $ 1 trillion in theinfrastructure sector.

This increased focus on infrastructure develop-ment bodes well for incremental steel demand inIndia, the E&Y report said.

Steelmakers around the world will have to find the right balance between globalisation and customisation, the reportsaid.

Anjani Agarwal, E&Y's Global Steel Leader said: "Globalisation is forcing change on steelmaking companies world-wide, amidst their need to customise and they must achieve the fine balance to survive and succeed.

“For this the sector will have to undergo significant change to create and retain value and turn profitable. It noted fourkey areas of transformation for steel companies around the world --Rationalise excess capacity, Increase market andproduct concentration, Boost Market Competitiveness and Embrace Digital. The latter would be in the form of predictiveanalytics, digital supply chain and convergence of IT and operational technology to develop differentiation and improvedecision making and resilience to risk.

The report also said that given price volatility in raw materials, steelmakers are changing their strategies around fix-ing steel product prices.

"Most companies have been reviewing product prices either on monthly or fortnightly basis but now companies arethinking of reviewing it daily. For instance, JSW Steel in India has started a daily review of product prices for long prod-ucts. The company believes that in the current dynamic market, it does not make sense to review prices once and holdthem for a certain period of time," it said.

Source: The Economic Times

WEEKLYECONOMIC BULLETIN >> NEWS ROUND UP16


Hero to acquire EBR's consulting businessThe American unit of Hero MotoCorp Ltd, India’s largest two-wheeler maker, has entered into a settlement agreement toacquire bike maker Erik Buell Racing’s (EBR) consulting business for $2.8 million, the company said on July 28.

Hero MotoCorp had in 2013 bought 49% stake in the Wisconsin, US-based bike maker and technology provider forRs.150 crore. EBR, in April, shut operations and filed for bankruptcy protection from creditors.

Hero MotoCorp’s American unit has agreed to acquire the ownership of certain “tangible and intangible assets” of theEBR entities as identified in the settlement agree-ment, which will be free and clear of all encum-brances, the statement said. As per the agreement,the assets of EBR entities being bought by Hero willbe excluded by the court-appointed receiver fromany other sale relating “to the Chapter 128 Receiver-ship”.

“The performance of the settlement agreementwill help the company’s in-house research and de-velopment (R&D) teams to accelerate developmentof certain consulting projects, including the projectsEBR was executing for Hero MotoCorp at the time offiling of the Chapter 128 Receivership,” the companysaid.

Mint had reported on 21 April that five products ofHero may get affected due to EBR filing for bankruptcy.

These are sportsbike HX250R, electric scooters Leap and SimplEcity, hydrogen fuel-cell bike iON, and diesel bike RnT.Erik Buell, a former motorcycle racer, is renowned for his engineering skills in motorcycle racing.In 1983, he started a company to make motorcycles in Wisconsin. Harley-Davidson Inc. eventually took over the unit,

distributing Buell Motorcycle machines through its dealers.Shortly after the Buell division closed in 2009 due to a global slump, Erik Buell launched EBR.

Source: Mint



June core sector growth slows to 3%Growth in the eight core sectors — coal, crude oil, natural gas, refinery products, fertiliser, steel, cement and electricity— slowed to three per cent in June after a six-month high of 4.4 per cent in May, mainly on account of contraction incrude oil and natural gas production.

Total growth in the core sectors, which has a weightage of nearly 38 per cent in the Index of Industrial Production,during the April-June period came down to 2.4 per cent from six per cent in the first quarter of 2014-15, according todata issued on Friday by the ministry of commerceand industry. Crude oil production declined 0.7 percent in June. During the first quarter, April-June, itsproduction declined 0.9 per cent over the same pe-riod last year. Similarly, production of natural gascontracted 5.9 per cent in June. Its cumulative indexduring April to June declined by 0.9 per cent overthe corresponding period of 2014.

According to economists, the June core sectordata was largely influenced by a positive base effectin June 2014. “The sequential dip is largely driven byan adverse base effect related to electricity genera-tion and is, therefore, not a cause for alarm. How-ever, this base effect is expected to persist for thesubsequent two months as well, with electricity gen-eration having expanded by 11-16 per cent in June-August 2014,” said Aditi Nayar, senior economist, ICRA. The growth incoal production came down to 6.3 per cent in June from a 7.8 per cent rise the previous month and 8.2 per cent in thesame month last year. Cumulatively, it increased 7.3 per cent over the corresponding period of 2014.

"June core sector growth is affected by the strong positive base effect in June 2014. Importantly, coal, fertiliser, steeland cement all have grown in June as compared to May. Electricity output growth of 0.2 per cent in June, although onthe face of it is disappointing, is achieved on 15.7 per cent growth in June 2014. In sum, despite weak demand condi-tions, three per cent growth in the core sector is encouraging,” said Devendra Kumar Pant, chief economist, India Rat-ings. Electricity generation increased 0.2 per cent in June and its cumulative index rise in April-June was 1.5 per centover the corresponding period of last year.

Production of cement increased 2.6 per cent in June. Cumulatively, it increased 0.9 per cent over the correspondingperiod of last year. Steel output rose 4.9 per cent in June and 2.8 per cent in the quarter from 2014-2015. “The pick-up ingrowth of steel production for a third month is encouraging,” Nayar added.

Source: Business Standard



India to extend e-visa facility to more nationsThe government on July 29 said it has finalised arrangements to extend and implement e-tourist visa facility to peoplefrom China, Hong Kong and Macau with effectfrom July 30.

The total number of countries or territories cov-ered under the e-tourist visa scheme will now goup from 74 to 77, an official release said onWednesday. The scheme will be extended to morecountries in a phased manner.

Under this scheme, tourists with e-tourist visascan arrive at nine designated airports -- Ben-galuru, Chennai, Cochin, Delhi, Goa, Hyderabad,Kolkata, Mumbai and Trivandrum.

Since the launch of the scheme, about two lakhe-toursist visas have been issued to nationals ofdifferent countries, it added.

Source: Indo-Asian Newws Service

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