Delhi to Nainital journey to get shorter
National Highways Authority of India (NHAI) has awarded Rs 1,336 crore projects for augmenting various stretches on NH 87 connecting Uttar Pradesh to Uttarakhand, to Sadbhav Infrastructure. On completion, the journey from the national capital to Nainital and beyond would get shorter. “Rampur to Rudrapur to Kathgodam on NH-87 connecting Uttar Pradesh to Uttarakhand will be built on BOT (build, operate, transfer) hybrid-annuity mode in two packages which have been cleared by NHAI Board in favour of Sadbhav Infrastructure Project Limited at bid price of Rs 1,336 crore,” NHAI said in a statement. Although the length of the project is only 93 km, it is critical for connecting to Nainital, it said adding the project will have three bypasses at Rampur, Bilaspur and Haldwani towns. The project is scheduled to be completed in two-and-half years time. The stretches are part of NH-87 starting from Rampur in Uttar Pradesh and terminating at Karnaprayag in Uttarakhand. “Four-laning of Rampur-Rudrapur-Kathgodam section would strengthen road infrastructure and serve as an important link to tourist places like Nainital, Kausani, Ranikhet, Mukteswar, Almora etc. This would also give impetus to industrial development as prominent industrial estates at Pantnagar and Lalkuan fall on this route,” the statement said. On completion, this would save the travel time for traffic plying from Delhi to Nainital and beyond in Uttarakhand apart from reducing cost of travel by lowering maintenance and wear and tear cost of vehicles, it added. The project would cover districts of Rampur, Udham Singh Nagar and Nainital and important towns such as Rampur, Bhotbazar, Bilaspur, Rudrapur, Pantnagar, Lalkuan, Haldwani and Kathgodam.
Core infra sector growth touches 15-month high of 5.7% in February
The output of eight core-sector industries surged to a 15-month high of 5.7% in February, marking a third straight monthly rise and recording a broad-based recovery, according to the official data released on Thursday. Barring coal, seven of the core sector constituents recorded a sequential improvement in February. A year-on-year contraction in steel output was also contained at just 0.5% in February, compared with a fall of 8.4% in the previous month, suggesting the government moves to protect domestic primary steel producers against cheaper imports were starting to have an impact, said analysts. The broad-based improvement in core sector growth in February will likely support the IIP (index of industrial production) estimate for the month, although the performance of the IIP in February could remain weak due to an unfavourable base (It had grown 4.8% in February 2015). The core infrastructure industries have a combine weightage of roughly 38% in the IIP. Despite the improvement, steel remained the only core to record a contraction in February, thanks to poor demand from end-users as well as the availability of cheaper imports. The imposition of minimum import price for steel imports helped to restrict the contraction to just 0.5% in February 2016 from an average of 5% in the previous three months. The imposition of minimum import price rendered pulled down imports and prop up domestic production. In coal, the slowdown in growth to 3.9% in February from as high as 9.1% in January are expected to have been caused by a build-up of inventories. Electricity generation touched a five month high of 9.2% in February, led by a double-digit growth of thermal electricity generation of 12%, the impact of which was dampened by an 11% contraction in hydro electricity generation. “If the monsoon in 2016 is normal after a gap of two years, hydroelectricity generation is expected to receive a substantial boost, which would improve the overall pace of expansion in power generation,” said Aditi Nayar, senior economist at ICRA. Cement output growth has risen for a third straight month to a robust 13.5% in February. “With demand from end-users, including cement-intensive infrastructure, rural housing etc. remaining modest, the double-digit growth in cement output is unlikely to sustain,” Nayar said. The two other sectors that witnessed a huge improvement in February were crude and natural gas. Crude output rose 0.8% in February, compared with a fall of 4.6% in the previous month. Similarly, natural gas output picked up 1.2% in February, against a 15.3% contraction in the previous month. Crude, natural gas and steel were the worst performer since the beginning of the last fiscal. Domestic steel production has been badly hit by cheaper imports, especially after Chinese mills started dumping in the global market to cut huge inventory, analysts said. No wonder, the segment witnessed contraction in each month since June last year.
Reforms to boost gas output 22 per cent to 110 mmscmd by FY21
Recent reforms in the oil and gas sector involving market-linked pricing will help the country drill out 22 per cent more gas at 110 mmscmd by 2020-21, a report said today. Early this month, the government unveiled a slew of reforms to attract investments into the domestic oil and gas sector by nearly doubling gas prices to over $7 a unit, apart from liberalising pricing. “The pricing formula along with marketing freedom will improve viability of gas discoveries in challenging fields and can lead to higher domestic gas production over the longer term,” rating agency Icra said in a note. It expects domestic gas production to rise to around 110 million metric standard cubic metre per day (mmscmd) by FY21 and 130 mmscmd by FY25 from 90 mmscmd in FY16. Similarly, demand for gas will be rising to 250 mmscmd by FY20 and 290 mmscmd by FY25 from the current demand of 230 mmscmd. But this projected demand is lower than what the agency had earlier projected at 275 mmscmd by FY20 and 330 mmscmd by FY25, saying gas demand will fall due to stiff competition from liquid fuels. Significantly, the peak levels of actual consumption in the past were 170 mmscmd in FY12 and 177 mmscmd in FY11. But actual consumption has declined consistently since to around 140 mmscmd in FY15 and FY16. Domestic gas prices have seen two downward revisions, in April 2015 and October 2015, following which the prices declined by 24 per cent to $3.88/mmbtu in second half of FY16 from $5.05/mmbtu in November 2014 – March 2015. The prices are expected to decline further from April 2016 in line with the decline in global gas prices, the report said, adding the fall in domestic gas prices had made future development of many gas fields unviable. Following this, the government recently provided marketing and pricing freedom to deep water, ultra-deepwater and high pressure-high temperature areas that are yet to begin production as of January 1, 2016.
Chandigarh becomes first kerosene-free city
For the first time, a city has been declared kerosene free with sale of subsidised cooking and lighting fuel being stopped in Chandigarh from today completely. Households have been shifted to LPG to help declare Chandigarh kerosene free. “Thus, no further distribution of subsidised kerosene will be done in Chandigarh from the month of April, 2016 onwards,” the Petroleum Ministry said in a statement. The Petroleum Ministry with the help of Chandigarh Administration has been working for the last few months to make Chandigarh ‘a Kerosene Free City’. The Ministry “decided to facilitate the households presently using kerosene oil by facilitating switchover to LPG,” it said. To facilitate the kerosene beneficiaries getting LPG connections, enrolment camps were organised by state-owned fuel retailers to provide hassle-free LPG connections. Also, deposit-free LPG connections were provided to BPL households and interest free loan scheme was launched for APL households. “During this campaign, a total of 15,249 LPG connections were provided in Chandigarh city, including 1574 for BPL households,” the statement said.
GAIL starts drilling exploration well at Cambay basin in Gujarat
State-run gas utility GAIL India has started drilling its first exploration well in an onland oil and gas block in Cambay basin in Gujarat. First exploratory well on NELP-IX Block CB-ONN-2010/11 was spudded on March 27, 2016, the company said in a statement here. The well is situated in Dugari village at Tarapur Tehsil of Anand District of Gujarat. GAIL is the lead operator of the block with 25 per cent participating interest in it. Other partners in this block are Bharat Petro Resources Ltd, Engineers India Ltd, Monnet Ispat Energy Ltd and Bharat Forge Infrastructure Ltd. “Drilling of target depth of 2,500 meters of this well is scheduled to be completed in 40 to 45 days followed by testing for another 10 to 15 days. This will target Cambay Shale and Olpad formations,” it said. GAIL and its partners plan to drill eight exploratory wells in the initial phase as per minimum work commitment of Production Sharing Contract (PSC). While this phase will continue till March 2017, acquisition, processing and interpretation (API) of 2D and 3D Seismic Data have already been completed, GAIL added.
Government implementing measures for startups at faster pace: DIPP
Moving on a fast-track to implement the ‘Startup India’ programme, several ministries, including labour and environment, have put in place mechanisms to ensure speedy clearances, a senior official said today. “We are moving ahead with a faster pace” to implement the measures, Joint Secretary in the Department of Industrial Policy and Promotion (DIPP) Shailendra Singh told reporters here. Talking about the implementation of measures announced in the action plan for startups, he said that Labour Ministry has issued the advisory regarding self-certification to all the states. Similarly, the Environment and Forest Ministry too has issued the circular. He said the DIPP has also identified a panel of lawyers who would provide assistance and support to startups on subjects like intellectual property rights and the fees for that service would be paid by the government. “Startups have to pay only the statutory fees, which is very miniscule,” he said adding the startup hub would start working from tomorrow. The hub will act as a single point of contact for the entire startup ecosystem and enable knowledge exchange and access to funding. For faster exit from a business, Singh said the bankruptcy Bill is in Parliament. Funds of Fund was already declared in the Budget and accordingly Rs 2500 crore each year would be released over four years to SIDBI. All the tax benefits will be extended to the budding entrepreneurs after the passage of the Finance Bill. On organising startup fest for showcasing innovation, he said at the national level it would be organised in June and at the international level in November. Singh said that the details and guidelines of Atal Innovation Mission is expected to be released in April by NITI Aayog. To ensure professional management of government sponsored/funded incubators, government is in the process of to create a policy and framework for setting up of incubators across the country. In January, Prime Minister Narendra Modi unveiled a slew of incentives to boost start-up businesses, offering them a tax holiday and inspector raj-free regime, capital gains tax exemption and Rs 10,000 crore corpus to fund them.
SpiceJet raises cancellation, rescheduling charges
A day after IndiGo raised cancellation charges on air tickets, SpiceJet announced to raise cancellation and rescheduling charges from April 7, 2016. The cancellation charges for domestic tickets has been increased from Rs 1,899 to Rs 2,250 and for international tickets have been raised from Rs 2349 to Rs 2,500. The announcement by SpiceJet comes a day after IndiGo’s announcement to raise cancellation charges to Rs 2250 for domestic fliers. Earlier, they charged between Rs 1250 and Rs 2250 depending on time of cancellation of ticket. The higher charges by IndiGo are with effect from April 1, 2016. Travel agents expect other airlines too will raise charges. Steep hike in cancellation charges by airlines have been inquired into in the past by the Directorate General of Civil Aviation, which had last year said that it decided to probe the sharp hike in ticket cancellation charges by airlines, as they had found the charges ‘unreasonable’ then.
Aviation policy likely to be cleared by Cabinet this month
A degree of “consensus” among various stakeholders on issues in draft civil aviation policy including norms for international flying by domestic airlines has “emerged” and it is likely to be approved by the Cabinet this month, a top official said today. “(As far as) 5/20 and other issues raised in the draft civil aviation policy (are concerned), a degree of consensus has already emerged,” Civil Aviation Secretary R N Choubey told reporters on the sidelines of the 29th anniversary of Bureau of Civil Aviation Security (BCAS). Under the ‘5/20 rule’ only those airlines having at least five years of domestic flying experience and a minimum of 20 aircraft are allowed to fly overseas. BCAS is country’s nodal aviation security agency. Choubey said that his ministry will be taking the matter to the Cabinet this month itself, adding, “the (new aviation) policy, which will also clear the position on 5/20, will be approved this month.” The draft policy was unveiled in October last year and since then Government has held extensive consultations with various stakeholders including ministries, airlines,airport operators, ground handling agencies, among others during this period. We have already done a couple of rounds of inter ministerial consultations. We will now be in a position to take the matter to the Cabinet this month,” he said. The policy was expected to be finalised in the previous financial year as certain proposals were to be implemented from April 1, 2016. While startup carriers Vistara and Air Asia India, where Tatas is a stakeholder, are demanding that the 5/20 rule be done away with, the grouping of four private Indian carriers comprising IndiGo, SpiceJet, Jet AirwaysBSE 3.56 % and GoAir wants the rule to continue. The proposed policy seeks to give a boost the Indian aviation sector, which has high growth potential, and strengthen regional connectivity. It has suggested tax incentives for airlines, maintenance and repair works of aircraft besides mooting 2 per cent levy on all air tickets to fund regional connectivity scheme. There are other significant proposals such as increasing FDI limit for foreign airlines, setting up of no-frills airports and providing viability gap funding for airlines to bolster regional air connectivity as well.
Cooking gas LPG down Rs 4 per bottle, jet fuel price up 8.7%
Aviation Turbine Fuel (ATF), or jet fuel, price was today hiked by 8.7 per cent but that of non-subsidised cooking gas LPG was cut by Rs 4 per cylinder on global trends. ATF price in Delhi was raised by Rs 3,371.55 per kilolitre (kl), or 8.69 per cent, to Rs 42,157.01 per kl, oil companies said today. The hike comes on the back of a marginal 1.3 per cent or Rs 515.85 cut in rates on March 10. Prior to that, rates were hiked by steep 12 per cent, or Rs 4,174.49, on March 1, almost neutralising a Rs 4,765.5 cut on February 1. The March 1 hike broke the cycle of three consecutive monthly price reductions. Rates vary at different airports because of differential local sales tax or value-added tax (VAT). Jet fuel constitutes over 40 per cent of an airline’s operating cost and the price increase will add to the financial burden on cash-strapped carriers. No immediate comment was available from airlines on the impact of the price increase on passenger fares. Simultaneously, the oil firms cut prices of non-subsidised LPG, which consumers buy after exhausting their quota of 12, by Rs 4 per 14.2-kg bottle. Non-subsidised cooking gas (LPG) now costs Rs 509.50 in Delhi as against Rs 513.50 previously. This is the third reduction in rates in a row. Prices were last cut by Rs 61.50 on March 1. Rates were reduced by Rs 82.5 per 14.2-kg bottle on February 1. Subsidised LPG costs Rs 419.33 per 14.2-kg cylinder in Delhi. The three fuel retailers – Indian Oil Corporation, Hindustan Petroleum and Bharat Petroleum – revise jet fuel and non-subsidised LPG prices on the first day of every month, based on the average international price in the preceding month. The ATF price cut on March 10 was on account of change in taxation.
European Investment Bank to lend $512 million for Lucknow metro
The European Investment Bank will give 450 million euros ($512 million) in loan to India to finance the construction of Lucknow’s first 23 km-long metro rail line and purchase a fleet of new trains. An agreement on the first tranche of the credit was signed in Brussels on Wednesday during the 13th EU-India summit attended by Prime Minister Narendra Modi. The loan represented the largest project financing by European Union’s official bank, also the world’s largest international public bank, in India since its engagement in the country began more than 20 years ago and the most significant investment in sustainable public transport outside Europe, Luxembourgbased European Investment Bank (EIB) said. The 450 million euro ($512 million) long-term loan – expected to cover half of the total project cost for the Lucknow Metro – will be used to finance the first metro line in Lucknow, including both construction of the 23 km-long new metro line and a fleet of metro trains. The line is the first part of a broader metro network planned for Lucknow, the capital city of Uttar Pradesh. When it becomes operational, the new metro is expected to increase the use of public transport from 10 per cent to an estimated 27 per cent in the city of three million people, the bank said in a statement. EIB president Werner Hoyer said the bank would expand its support for long-term investments in India and unveiled plans to open a regional representation for South Asia in New Delhi by the end of this year. The EIB has supported long-term investment across India that has helped the country harness renewable energy, strengthened industry and reduced carbon emissions. The bank recognises that the time is right to increase its engagement in India, Hoyer said. “The first metro line in Lucknow is a flagship project not only for Uttar Pradesh and India, but also for the bank’s strengthened global commitment to support transformational investment,” Hoyer said. The loan agreement was signed by India’s Ambassador to Belgium, Luxembourg and the EU Manjeev Singh Puri and EIB Vice President for Asia Jonathan Taylor in the presence of Modi, European Commission President Jean-Claude Juncker and European Council President Donald Tusk. The EIB had committed loans totalling more than 1.34 billion euros for longterm investment in India since the cooperation began in 1993.