MUMBAI: Ahmedabad-based Zydus Cadila is in early stages of talks to acquire Bangalore-based Strides Arcolab’s Rs 70-crore domestic generic business, said two people familiar with the matter.
Strides’ domestic generic business, which has a range of antibiotic and nutraceutical products, will help Zydus get a wider market access in a highly competitive segment, said a person on conditions of anonymity.
The India business is a small part of Strides’ overall pharma business, which reported after tax revenue of Rs 518 crore and also has businesses in Latin America and emerging markets.
When contacted by ET, Strides denied any such development, while Zydus Cadila did not respond to an e-mail query.
“We wish to clarify that Strides is not in discussion with anybody concerning sale of its Indian branded business,” said Arun Kumar, CEO, Strides Arcolab. The Indian generics business is an important part of Strides’ future strategy and the company continues to invest in its expansion, he said.
However, if Zydus buys Strides’ formulations business in India, it will be the second acquisition by Zydus within a year.
In August 2011, Zydus had acquired brands and manufacturing facility of Mumbai-based Biochem to strengthen its anti-infective portfolio.
The company, with a market cap of 15,000 crore, has been on a hunt for smaller size domestic firms that have specific product pipelines. Biochem acquisition was in line with Zydus’ strategy of expanding in key therapy areas with high volume product range.
Pharma analysts said domestic formulations business has ample headroom for further growth. “There is still growth in domestic business, the story around increasing penetration is still alive and kicking,” said Abhishek Sharma, head of Life Sciences Mape Advisory.
He said for small-sized companies there is very little interest from multinationals and it is usually the domestic companies who are interested.
JSPL ACQUIRES 9.25 PER CENT STAKE IN AUSTRALIA’S APOLLO MINERALS
NEW DELHI: Jindal Steel and Power Ltd (JSPL) has acquired a 9.25 per cent stake in Australia’s Apollo Minerals for AUD 1 million (about Rs 5.30 crore). “JSPL is making a significant investment in Apollo. This initial investment, facilitated by Bligh Capital Pty Ltd, will provide JSPL with 9.25 per cent of the total issued shares in Apollo,” the Australian company said in a statement. It added that the deal will be completed this week and is not to subject to regulatory approvals from any Australian or state government agency. Before this acquisition, the Naveen Jindal-led firm’s presence in Australiawas limited to the coal sector with six exploration permits in Queenslandand 27.27 per cent stake in Rockland Richfield. (For details log on to : http://economictimes.indiatimes.com/news/news-by-industry/indl-goods/svs/steel/jspl-acquires-9-25-per-cent-stake-in-australias-apollo-minerals/articleshow/13052592.cms)
ADVISORY FIRMS RAISE A STINK AGAINST ESCORTS’ MERGER PLAN
MUMBAI/NEW DELHI: Minority investor advisory firms such as Institutional Investor Advisory Services and InGovern Research Services have criticised Escorts’ reorganisation plan, involving three of its associate companies, calling it a breach of corporate governance. The company has put in place a complex proposal, which if approved by its shareholders at court-convened meeting to be held on May 20 will give the promoter Nanda family voting rights in excess of 40 per cent, way beyond their direct shareholding in the company, which is currently at just 12.43 per cent. Under the proposal, three associate firms — Escorts Construction Equipment, Escotrac Finance and Investments and Escorts Finance Investments and Leasing Private — will be merged with Escorts. Further, ECEL shareholding in Escorts and treasury shares will get transferred to Escorts Benefit & Welfare Trust, which would be settled by Escorts upon the approval of the scheme. IIAS and InGovern, entities that advise minority institutional shareholders, have asked the shareholders to vote against the merger proposal citing that the move is detrimental to the interests of minority investors. (For details log on to : http://www.business-standard.com/india/news/advisory-firms-raisestink-against-escorts-merger-plan/473840/)
ICRA ARM BUYS US TECH FIRM
KOLKATA: Kolkata-headquartered Icra Techno Analytics Limited (ICTEAS), a unit of rating agency Icra Limited, will buy California-based BPA Technologies, a business consulting and software technology services firm, for about $16 million. ICTEAS has paid $8 million for 50.1 per cent of BPA. The rest will be paid in two tranches over three years. The acquisition would help ICTEAS establish a footprint in the Californiaregion, said P K Choudhury, vice-chairman and group CEO of Icra. “ICTEAS has its clients across the globe: in the US, the UK, Asia and Africa. The business now requires a larger presence in the USthan we currently have, and BPA gives us exactly what we need. The skill sets of the two companies are complementary, and there is significant convergence in terms of the industry verticals that ICTEAS and BPA focus on,” said Choudhury. BPA’s turnover for the year ended December 31, 2011, was about $10 million. In India, BPA has development centres in Chennai and Visakhapatnam, and a sales and customer service centre in Singapore. (For details log on to : http://www.business-standard.com/india/news/icra-arm-buys-us-tech-firm/473817/)
DUNKIN’ DONUTS ENTERS INDIA
NEW DELHI: US-based foods chain Dunkin’ Donuts has come to India just a few months ahead of the arrival of its global archrival Starbucks, by launching its first store in the national capital on Tuesday. Starbucks is expected to launch in September this year. The company, headquartered at Cantonin Massachusetts, plans to set up eight to 10 stores this financial year — all in Delhi. That, it says, would earmark its journey to slowly turn out to be a pan-India player with about 100 stores in the country in the next five years. Its strategy is to be an “affordable” eating place that would bring in the moolah from food. This would thus be unlike the case in the US, where coffee reigns supreme in terms of revenue. Hari S Bhartia, co-chairman and founder of Jubilant Bhartia Group, said the aim was to launch an affordable brand in India. “Our products like coffee are priced 10 per cent to 15 per cent lower than competitors,” he noted. “We want more customers to come in so that we get scale in the business.” (For details log on to : http://www.business-standard.com/india/news/dunkin-donuts-enters-india/473838/)
PINKBERRY TO VIE WITH INDIA’S COCOBERRY
NEW DELHI: America’s Pinkberry is set to enter Indiaby the end of this year. The Los Angeles-based frozen yogurt chain’s first outlet is likely to be opened either in Bangaloreor Mumbai. Jay Singh, co-founder and executive director, JSM Corporation, the master franchisee for Hard Rock Café and now Pinkberry, said the start would be slow and cautious. Expansion plans would be chalked out eventually, he told Business Standard. The group is looking at a combination of strategy — to have Pinkberry outlets both inside malls and standalone restaurants in high streets. While these are early days in Indiafor the frozen dessert category, it’s a rapidly growing format globally. At over 180 outlets globally, the 2005-founded upscale restaurant chain is present across 17 countries. Indiawill be 18th in the list. Singh refused to elaborate on the planned number of Pinkberry outlets in India, but named Cocoberry as the most prominent player in India in the frozen dessert format — and therefore the biggest competition in India. Cocoberry is a homegrown brand, with international expansion plans. (For details log on to : http://www.business-standard.com/india/news/pinkberry-to-vieindias-cocoberry/473839/)
ICRA PLANS TO EXPAND IN ASIA
MUMBAI: After establishing a presence in Indonesiaand Sri Lanka, Icra, the rating agency and associate of Moody’s in India, plans to expand further in Asiato get a slice of business from the growing bond markets. The focus will be on domestic rating activity, while Moody’s looks at cross-border business. It is in the process of deciding on countries to set up base. “The bond market in Asiais growing. Icra will use the expertise developed in Indiafor business growth. The agency will consult Moody’s, its largest shareholder, on entering new markets,” said its Vice-Chairman and Group Chief Executive, P K Chaudhury. At present, Icra has subsidiaries in Sri Lankaand Indonesia. The Lankan unit, incorporated in December 2010, received a licence from the Securities and Exchange Commission of Sri Lankain May 2011. The Indonesian subsidiary, PT Icra Indonesia, got its operating licence from the Capital Markets and Financial Institution Supervisory Board of that country in September 2010. Chaudhury said Icra intended to bring in local partners like banks and insurance companies to hold a small equity stake in these two subsidiaries. So far, there have been only initial discussions about getting local partners on board. (For details log on to : http://www.business-standard.com/india/news/icra-plans-to-expand-in-asia/473812/)
FDI STATUS FOR PIO FUNDS IN AVIATION TO CONTINUE
NEW DELHI: The finance ministry has decided that investment by a person of Indian origin (PIO) in the aviation sector will continue to be treated as foreign direct investment (FDI) owing to security reasons. Unlike non-resident Indians (NRIs) who are allowed to invest 100% in aviation, the PIO can invest only up to 74%, subject to the FDI ceiling. In a note, the department of economic affairs (infra and investment division), last month, clarified that NRIs are ‘Indian citizens’, whereas, PIOs are not. “In the civil aviation sector, especially for the air transport sector, this is material because of the Civil Aviation Requirement Rules 1937, which requires Indian citizen holding a majority,” the DEA said. (For details log on to : http://www.financialexpress.com/news/fdi-status-for-pio-funds-in-aviation-to-continue/947095/)
CCEA TO TALK SELLOFFS ON MAY 10
NEW DELHI: The halted PSU sell-off programme is set to resume. The Cabinet Committee on Economic Affairs (CCEA) is likely to take up a clutch of disinvestment proposals on Thursday, including follow-on offers (FPOs) of Steel Authority of India (SAIL), Hindustan Copper, Nalco and Neyveli Lignite Corporation, official sources told FE. While the timing of these offers will depend on market conditions, the government’s move to clear the decks right at the start of the fiscal signals its intent to fast-track the disinvestment process, which faced hurdles in the past year. The budget target is to mobilise R30,000 crore from PSU disinvestment in the current fiscal. Steel major Rashtriya Ispat Nigam’s initial public offering (IPO), which was cleared by the Cabinet earlier, would be the first offer to hit the market this fiscal. The other offers could follow RINL’s IPO, which is expected to fetch some R2,500 crore. (For details log on to : http://www.financialexpress.com/news/ccea-to-talk-selloffs-on-may-10/947116/)
EXPORTS SOPS MAY COME BACK
NEW DELHI: Two months ago, with fiscal consolidation on his mind, Finance Minister Pranab Mukherjee scratched out export subsidies from his budget. Today, worried by a widening gap between imports and exports, the government is thinking of bringing back sops for exporters. These subsidies are likely to include discounted interest rates, and product- and market-linked incentives. The government believes these could boost exports and help narrow a trade deficit which has expanded to 9% of GDP. “Recently, we had a debate in Parliament on the export situation while discussing the demand for grants. We are seriously looking at giving fresh incentives to exporters,” Commerce and Industry Minister Anand Sharma told ET. Incentives, worth about Rs 1,700 crore, were announced in October last year. These included sops for exporting products such as textiles, engineering goods, chemicals and electronics to new and traditional markets, and the interest subvention scheme that gave loans to exporters from select sectors at subsidised rates. Both expired on March 31. (For details log on to : http://economictimes.indiatimes.com/news/economy/policy/bid-to-bridge-widening-export-import-gap-exports-sops-may-come-back/articleshow/13057624.cms)
FUEL PRICE HIKE MAY COME THIS JUNE, TOO
NEW DELHI: June may turn out to be the luckiest month for government oil marketing companies for the third year in a row. Like the last two years, this June is also expected to see a round of price hikes in controlled fuel products. Price hikes of controlled petroleum products such as diesel, cooking gas and kerosene have been happening annually in the month of June, irrespective of the companies’ losses. A price increase of petrol is also likely. This is a departure from the period following the dismantling of the administered pricing mechanism (APM) in April 2002. The first year after the APM was dismantled saw as many as 16 price changes, of which 12 were price increases in both petrol and diesel. While petroleum ministry officials are tight-lipped about the next price increase, industry officials are certain of another hike some time next month as the Budget session of Parliament is scheduled to end on May 22. Hinting at a fuel price hike, Finance Minister Pranab Mukherjee said in Parliament on Tuesday it was impossible for the government to maintain the current level of fuel subsidies. He said the government would have to address the under-recoveries of oil marketing companies IndianOil, Bharat Petroleum and Hindustan Petroleum. At the current prices of products, oil companies are likely to see record under-recoveries of Rs 1.8 lakh crore for the financial year. (For details log on to : http://www.business-standard.com/india/news/fuel-price-hike-may-come-this-june-too/473832/)
GOVT PULLS OUT REVIEW PETITION ON SC VERDICT
NEW DELHI: In a surprise move, the government on Tuesday decided to withdraw its review petition seeking clarity on the Supreme Court ruling which called for allocating all natural resources through auctions. The court had made this directive as part of its February 2 verdict, that cancelled 122 tainted telecom licences issued by former telecom minister A Raja in 2008. It is understood that since the government has sought clarity on similar issues through presidential reference, there was no point in pursuing a separate review petition. Legal sources said that the government has once again bungled in its “directionless” legal strategy. They said, while a review petition is an adjudication, presidential reference is only an opinion. The next hearing was listed for May 10 after the court issued notices seeking replies from the parties concerned — the NGO Centre for Public Interest Litigation and Janata Party president Subramanian Swamy. (For details log onto : http://www.financialexpress.com/news/govt-pulls-out-review-petition-on-sc-verdict/947127/)
RIL GAS OUTPUT TO FALL FURTHER: REDDY
NEW DELHI: Gas output from the Andhra offshore fields of Reliance Industries (RIL) is expected to drop further to a quarter of the targeted volume in the next three years, oil minister S Jaipal Reddy told Rajya Sabha in a written reply on Tuesday. Output from the D1 and D3 discoveries in the KG-D6 field has dropped to about half of the 60 mcmd (million cubic metres per day) peak production it had achieved in March 2010. This is expected to bottom out to 20 mcmd in 2014-15, Reddy said. The field was projected to pump 80 mcmd by that year. TOI had on May 2, 2011, first reported the expected fall in gas output. On April 4, 2011, the Directorate General of Hydrocarbons – the oil ministry’s regulatory arm – had told the government that RIL’s revised work programme and budget for 2011-12 and 2012-13 indicated production of 43 mcmd and 38 mcmd, respectively. (For details log on to : http://timesofindia.indiatimes.com/business/india-business/RIL-gas-output-to-fall-further-Reddy/articleshow/13057790.cms)
CIL MAY HIKE PRICES BY 5-10%, SAY ANALYSTS
KOLKATA: Analysts expect state-owned miner Coal India Ltd (CIL) to raise prices by 5-10% in the current quarter to mitigate the impact of a wage hike it agreed to in January after months of negotiation with its workers. The miner raised wages of its 365,000 workers by an average 25% with retrospective effect from July which, according to an official, required the company to put aside Rs.3,000 crore in the quarter ended March for payment of arrears. CIL had put aside Rs.750 crore each in the two preceding quarters for the same purpose. The total provision on account of the wage revision at around Rs.4,500 crore exceeded initial estimates, said the company official cited above, who declined to be named. If the profit margin is to be maintained at the same level as in fiscal 2012, the firm will have to raise prices, said this person, and this could happen by the end of this month. (For details log on to : http://www.livemint.com/2012/05/08213855/CIL-may-hike-prices-by-510.html?atype=tp)
COAL INDIA AGAIN SEEKS EOI FOR MOZAMBIQUE BLOCK EXPLORATION
NEW DELHI: Coal India Ltd has sought expression of interest (EoI) for the third time from companies, to undertake drilling activities at a coal block in Mozambique. Similar EoIs were sought in 2010 and 2011. However, the previous tenders were cancelled and no company was selected for the job due to technical reasons. “The earlier difficulties (on tendering process) have been removed. We hope to give the contract this time,” Mr S. Narsing Rao, Chairman, Coal India, told Business Line. The last date for submission of EoI is May 25. The tender has been floated in Mozambiqueby CIL subsidiary, Coal India Africana Limitada (CIAL). (For details log on to : http://www.thehindubusinessline.com/todays-paper/tp-corporate/article3398565.ece)
TARIFF-BASED BIDDING MADE MANDATORY FOR NEW POWER TRANSMISSION SERVICES
NEW DELHI: The Ministry of Power has made it mandatory for new projects to get transmission services through tariff-based competitive bidding. In other words, the company offering the lowest transmission tariff will emerge the winner. This move is aimed at attracting more private investment into the transmission sector, as is the case for road projects. “The intra-State transmission projects would also be moving to the tariff-based competitive system from January 2013, according to the tariff policy,” according to a statement issued by the Ministry on Tuesday .Till now, eight inter-State transmission projects worth Rs 14,000 crore have been allotted through competitive bidding, it added. (For details log on to: http://www.thehindubusinessline.com/todays-paper/tp-economy/article3398580.ece)
INDIA‘S ENERGY SECURITY UNDER THREAT: FICCI
HYDERABAD: India’s energy security is under grave threat as the various elements of the energy economy are out of gear, industry association FICCI has said. The apex chamber has demanded a comprehensive power policy that focuses on removing subsidies for hydrocarbons and ensures sustained development of the sector, which is faced with host of challenges impacting its progress. Increasing fuel burden, inadequate coal supplies, rising under recoveries of oil marketing companies and volatile crude prices have all contributed to the problem, the chamber said. Mr R. V. Kanoria, President of the Chamber, said, “There is immediate need to rationalise tariffs and address sector concerns. The sector is finding it tough due to lack of coal supplies, inadequate investments and delays in reforms process.” (For details log on to : http://www.thehindubusinessline.com/todays-paper/tp-economy/article3398573.ece)
RIL CONFIRMS GAS RESERVE DOWNGRADE AT KG-D6
MUMBAI: Reliance Industries (RIL) has cut estimates for proven gas reserves in its Krishna-Godavari block off the east coast by 6.7 per cent, to 3.67 trillion cubic ft (tcf), the company said in its annual report. The report also mentioned it had planned to invest Rs 4,800 crore in its telecom business this year. The company, which has Broadband Wireless Access licences across the country, is to launch high-speed data services on the LTE platform this year. “The broadband market in Indiais expected to leapfrog from its current user base of around 20 million wireless and wire-line subscribers. Our foray in Broadband Access is aimed at achieving a leadership status in providing digital services to a large base of consumers and providing next generation data services,” said Mukesh Ambani, chairman and managing director, in a statement to shareholders. (For details log on to: http://www.business-standard.com/india/news/ril-confirms-gas-reserve-downgrade-at-kg-d6/473810/)
COAL REGULATOR TO HAVE PRICING POWER
NEW DELHI: The government plans to empower the regulator being set up for the coal sector with the authority to decide pricing. The proposal, if implemented, would deprive state-owned Coal India (CIL) the freedom it currently enjoys in fixing and revising prices of its output. “The regulator’s primary function would be to set the prices of raw coal. A note on the Coal regulatory Authority Bill, 2010, has been sent to the Cabinet,” said a senior coal ministry official. He, however, added the authority would not have the power to grant or cancel mining licences. Independent regulation of the sector is important to ensure competitiveness of e-auction sales, fixing guidelines for price revision for supply pacts, fixing trading margins and increasing transparency in the allocation of reserves. The draft legislation is likely to be discussed by the Union cabinet in its meeting on Thursday. (For details log on to : http://www.business-standard.com/india/news/coal-regulator-to-have-pricing-power/473827/)
SURPLUS COAL MAY BE SOLD AT PRODUCTION COST
NEW DELHI: Fearing profit-making by private miners through the sale of surplus coal produced at captive mines, the government plans to impose a policy guideline asking captive mining companies to sell the surplus coal to Coal India (CIL) at production cost, or without any margin. The proposal, if implemented, would make Sasan coal diversion by Reliance Power an exception, and discourage the production of surplus coal. The proposal is part of the new policy on the usage of surplus coal, likely to be finalised by the government in a month. An empowered group of ministers (EGoM), headed by Finance Minister Pranab Mukherjee had, on April 29, decided to stick to an earlier decision to allow Reliance Power to divert surplus coal produced from mines allotted for the Sasan project in Madhya Pradesh to another project nearby. (For details log on to : http://www.business-standard.com/india/news/surplus-coal-may-be-sold-at-production-cost/473828/)
QUALCOMM GETS SPECTRUM WITH REDUCED VALIDITY
NEW DELHI: The Department of Telecommunications (DoT) on Tuesday allotted broadband wireless access (BWA) spectrum to US telecom giant Qualcomm Inc but with its validity reduced from 20 to 18.5 years. The DoT also made the roll-out obligation tougher by reducing it from five years to three and a half. The move, top sources close to Qualcomm say, will be challenged by the company in the appellate tribunal, TDSAT. Qualcomm had won BWA spectrum in four circles (Delhi, Mumbai, Kerala and Haryana) for Rs 4,900 crore in 2010. It had challenged the government’s decision to delay the issuance of a licence as well as spectrum in the TDSAT. The company received its licence in March this year, as the TDSAT directed the DoT to do so after Qualcomm forked out Rs 410-crore disputed dues its partners had to pay to the government. Qualcomm had roped in Tulip Telecom as well as GTL, which together hold 26 per cent stake in the BWA company. (For details log on to : http://www.business-standard.com/india/news/qualcomm-gets-spectrumreduced-validity/473831/)
FINANCE BILL RELIEF FOR THERMAL POWER UNITS
MUMBAI: The Finance Bill passed by the Lok Sabha yesterday, to give effect to the Union Budget proposals, has removed the 2014 time bar it had earlier proposed on the duty exemption for thermal coal. In its earlier Budget proposals, the finance ministry sought to exempt thermal coal (also called steam coal, and used in thermal power generation) from the basic customs duty of five per cent and the concessional countervailing duty of one per cent till March 31, 2014. The exemption with the time bar of 2014 was also extended to natural gas and liquefied natural gas (LNG), uranium concentrate and sintered uranium dioxide in natural and pellet forms. However, the final Bill removed the time bar for coal; it stays for natural gas, LNG and uranium derivatives. Official sources said the decision to exempt coal indefinitely from import duty was done to perk the infrastructure sector. “Two years is a very small gestation period for setting up power plants or any energy-intensive ventures using steam coal as fuel Therefore, the time period for granting the exemption from basic customs duty and CVD has been extended indefinitely,” they said. Adding that domestic producers of thermal power were already under stress because of high prices of coal. (For details log on to : http://www.business-standard.com/india/news/finance-bill-relief-for-thermal-power-units/473790/)
BHARAT BOOSTS VOLUMES FOR FMCG FIRMS AS INDIA SLOWS
NEW DELHI: FMCG firms are swimming against a slowing economy, selling more soaps, toothpaste, washing powder and shampoos, riding mainly on volumes in India’s small towns and villages. Profits at India’s three largest FMCG firms — Hindustan Unilever (HUL), Godrej Consumer Products and Dabur India— which have announced yearly results have grown in double digits in fiscal 2012, beating analysts’ expectations. “Even in this inflationary environment, consumer demand has been quite resilient,” Nitin Paranjpe, chief executive of HUL — India’s largest packaged consumer goods company by sales, which makes Surf detergents and Lux soaps —said after announcing the company’s results last week. “Consumers in Indiaare upgrading faster than downtrading.” Consumers usually choose a cheaper product in a slowing economy with high inflation. (For details log on to : http://www.financialexpress.com/news/bharat-boosts-volumes-for-fmcg-firms-as-india-slows/947130/)
INDIA OBJECTS TO BEING PUT ON US IPR WATCH LIST
NEW DELHI: India has protested being placed once again in the US priority watch list of countries with insufficient intellectual property protection and has said its regime is completely compliant with all WTO regulations, including the Trips Agreement. Commerce and Industry Minister Anand Sharma has shot off a letter to UStrade representative Ron Kirk describing the USmeasure as unfortunate and unjustified. “I would like to mention that Indiahas been found to be compliant with all WTO regulations, including the TRIPS Agreement, in the recent review of India’s trade policy carried out in the WTO,” Sharma said in his letter. Last month, the USTR issued its Special 301 Report, an annual review of the state of IPR protection and enforcement in trading partners around world. (For details log onto : http://economictimes.indiatimes.com/news/economy/policy/india-objects-to-being-put-on-us-ipr-watch-list/articleshow/13059108.cms)
LET’S BITE THE BULLET ON FUEL & REFORMS: FM TO OPPOSITION, STATES
NEW DELHI: The United Progressive Alliance’s chief crisis manager Pranab Mukherjee made a compassionate plea to all political parties and states to urgently bite the bullet on fuel subsidies and urged the Opposition to help with the passage of some crucial economic laws. He also tinkered with the indirect tax rates to cheer some sectors, including commercial vehicles, solar energy, polyester fibre, yarn from waste and certain parts of footwear, even as he expressed hope that the Goods and Services Tax could be rolled out next fiscal. Winding up the debate on the Finance Bill, 2012 in Lok Sabha, Mukherjee also promised the House a white paper on black money in the ongoing session of Parliament itself, though he declined to reveal the names of tax evaders. “…the government is awaiting the reports about the estimate of black money stashed abroad, which are being prepared by three independent groups,” he said on Tuesday. (For details log on to : http://economictimes.indiatimes.com/news/economy/policy/lets-bite-the-bullet-on-fuel-reforms-pranab-mukherjee/articleshow/13059049.cms)
BASE EFFECT TO HAVE AN IMPACT ON INFLATION, SAYS FICCI
NEW DELHI: Inflation is likely to decline till September mainly due to impact of base effect, a Ficci report today said. The base effect pertains to high inflation numbers a year ago, which makes even a high increase in the price index now appear much lesser. In its economy watch, Ficci said: “…the base effect will continue to have an enabling impact on inflation numbers till September 2012”. It said that commodity prices (except oil) will remain subdued, resulting in lower input costs for the manufactured products. “Moreover, the rupee is expected not to depreciate significantly from the current levels, thus helping in containing imported inflation,” it said. (For details log on to : http://economictimes.indiatimes.com/news/economy/indicators/base-effect-to-have-an-impact-on-inflation-says-ficci/articleshow/13056109.cms)