Crude oil, natural gas output down in May
Domestic crude oil and natural gas production fell 3.34 per cent and 6.88 per cent, respectively last month, according to data released by the Ministry of Petroleum and Natural Gas. Domestic crude oil production stood at 3.078 million tonnes in May 2016 compared with 3.184 mt in the same month last year. Natural gas production stood at 2.656 billion cubic meter during May against 2.852 billion cubic meter in the same month last year. Further, refinery throughput during the month grew 1.24 per cent to 19.950 mt compared with 19.705 mt in the same month last year. Dave Dravecky Womens Jersey
Indian pipe companies dominate Rs 550 crore GAIL contract
Three Indian pipe manufacturers have walked away with a major pie of a Rs 550 crore order from GAIL as the state-run gas utility began spending on building the main stretch of Urja Ganga — PM Narendra Modi’s proposed energy lifeline to revive fertilizer units and supply cleaner fuel in the eastern region. Sources said Gas Authority of India (Limited) has placed the order for 341km of pipes with Jindal Saw, Essar Steel and MAN Industries. China’s Zhongyou BSS (Qinhuangdao) Petropipe is the lone overseas company to be awarded part of the contract, indicating competitiveness of Indian manufacturing. The order is for linking Phulpur in UP with Dobhi in Bihar, which is part of the Phulpur-Haldia pipeline. Work on spur lines from Gaya to Barauni via Patna in Bihar are already in progress. GAIL is set to complete the Rs 12,000-crore Phulpur-Haldia-Dhamra (Odisha) project in three phases The project envisages laying a 2,050km pipeline for supplying cleaner and cheaper fuel to Allahabad in UP; Patna, Gaya, Chapra, Siwan, Gopalganj, Muzaffarpur, Bettiah and Bhagalpur in Bihar; Bokaro, Dhanbad, Ranchi and Jamshedpur in Jharkhand; and Asansol, Durgapur and Kolkata in West Bengal. The pipeline will help revive defunct fertilizer plants in Gorakhpur in UP, Barauni in Bihar, Sindri in Jharkhand and Durgapur in West Bengal by supplying gas, considered a cheaper feedstock than naphtha. In addition, the pipeline will also supply natural gas to refineries in Barauni and Haldia, steel industries, power plants and other large manufacturing units in the region. Josh Jackson Jersey
India announces sweeping reforms to foreign direct investment rules; Apple, Ikea to benefit
India announced on Monday sweeping reforms to rules on foreign direct investment, opening up its defence and civil aviation sectors to complete outside ownership and clearing the way for Apple to open stores in the country. The reforms also loosen restrictions on inbound investments in pharmaceuticals and retail. Apple is expected to be a beneficiary of a three-year relaxation India is introducing on local sourcing norms with an extension of up to five years possible if it can be proven that products are “state of the art”. Other single-brand retailers like furniture giant IKEA are also expected to benefit. Defence contractors that have been reluctant to transfer technology to manufacture equipment in India would get the right to own local operations outright, up from 49 percent previously. In other changes, India allowed 100 percent foreign direct investment (FDI) in civil aviation, following on from last week’s launch of a new policy that lowered barriers to entry for airlines that want to fly international routes. The government also allowed foreign companies to own up to 74 percent in ‘brownfield’ pharmaceuticals projects without prior government approval. India already allows 100 percent ownership of greenfield pharma businesses. The reforms announcement comes two days after India’s central bank governor Raghuram Rajan, feted by foreign investors, announced he would not be available for reappointment when his term expires in September. Rajan’s decision, whose reforms have been credited for much of the economy’s success in recent years, came as a jolt to the country’s financial markets. The rupee fell to a near one-month low and bonds weakened on Monday. The last time Prime Minister Narendra Modi’s two-year-old government announced a loosening of FDI norms was after his nationalist political party suffered a heavy defeat in a state election last autumn. Montravius Adams Womens Jersey
FDI in single-brand retail: Easing of sourcing norm may open doors for Apple Stores
he government decision on Monday to relax local sourcing norms for foreign brands keen to open own stores in the country has almost paved the way for Apple Stores as companies with ‘cutting-edge’ technology can possibly avoid local sourcing for up to eight years. The Cupertino, California-based maker of iPhones and Mac computers is now looking to initiate talks with the government and put up details of its technologies and patents it holds to show it’s a maker of cutting-edge technology products, a person aware of the development said. A note issued by the prime minister’s office on Monday said, “It has now been decided to relax local sourcing norms up to three years and a relaxed sourcing regime for another five years for entities undertaking single brand retail trading of products having ‘state-ofart’ and ‘cutting edge’ technology.” An email sent to Apple India did not elicit any response as of press time on Monday. The person quoted earlier said a clarification on the definition of ‘cutting-edge technology’ will be welcome. It remains a grey area as the Foreign Investment Promotion Board (FIPB) had last month denied exemption from 30% local sourcing norms to Apple while approving its application to open own stores. The nodal agency for clearing foreign direct investment (FDI) proposals, instead, asked the Department of Industrial Policy and Promotion (DIPP) to incorporate a definition of the term ‘cutting edge’ in FDI policy framework. Chinese smartphone maker LeEco, which too had applied for retail FDI, is now hopeful that its application will get fast-track approval. LeEco India chief operating officer (smart electronics business) Atul Jain said the company will eventually meet the sourcing norms since it soon plans to start local manufacturing. He said the government’s intention is clear that it wants to make a strong impetus to investment and encourage more technology brands to enter India and hence the lack of definition of cuttingedge should not be a stumbling block. LeEco plans to open 5-10 company-owned stores in the country, Jain said. Apple has no immediate plans to manufacture or source products from India, except refurbish iPhones that it plans to sell as company-certified pre-owned handsets. But the government is not much in favour of refurbished phones. As per industry estimates, sales from exclusive stores account for 15% of smartphone sales for brands that have such franchiseerun outlets while around 50-55% of smartphones are sold from neighbourhood multi-brand stores, 15% from large retail chains, and balance 15-20% from ecommerce marketplaces. Apple CEO Tim Cook during his recent visit had told his India team how company-owned stores are vital for Apple’s long-term plans since it would set benchmarks in sales and services, even though he does not want to disrupt the existing distribution and retail network as multi-brand stores still accounts for a large share of overall sales in India. Chinese brand Xiaomi, which had earlier sought an exemption from local sourcing norms to set up own stores, recently told the government that it does not need the waiver any more since it is already manufacturing in India. Xiaomi said it was studying the changes. Chidobe Awuzie Womens Jersey
Government allows 100% FDI for online grocery startups
In a boost to retailers and grocery startups such as Bigbasket and Grofers, the government on Monday allowed 100% FDI in food retail, including through e-commerce, provided such items are produced, processed or manufactured in the country. This will allow multi-brand retail giants such as Walmart to look at their food business here closely and perhaps even foray into B2C food retail. Currently, the US giant operates a B2B business here since FDI in multi-brand retail is not allowed. The US retailer has built a strong backend infrastructure in food. Similarly, the move will help Indian hyper-local grocery startups raise funds more easily. “The decision by the government to allow up to 100% foreign direct investment (FDI) through FIPB in marketing of food products produced or manufactured in India, including through e-commerce, is very progressive and will help in reducing wastage, helping farm diversification and encourage industry to produce locally within the country. This far-reaching reform will benefit farmers, give impetus to food processing industry and create vast employment opportunities. We will study the policy document when government finalises and issues it,” said a Walmart India spokesperson. The decision comes without any riders, department of industrial policy and promotion secretary Ramesh Abhishek said. The food processing ministry wanted the food retailers to mandatorily invest in back-end infrastructure besides being allowed to sell some non-food goods. “This initiative (FDI in food retail) could bring in investments in food infrastructure by global players and provide a platform to sell those products manufactured in India, thus opening up the domestic food market,” said Sreedhar Prasad, partner-e-commerce, KPMG in India. “Further, this could enable some of the existing e-commerce players to attract FDI in food category where they are selling only products manufactured or produced in India.” The government expects it to curb food wastage as well, said Abneesh Roy, associate director at Edelweiss Securities. Food processing minister Harsimrat Kaur Badal has been seen rooting for FDI in the sector citing heavy food wastage. She said India has been wasting food and agricultural produce worth Rs 92,000 crore and foreign funds can build infrastructure at farm gate level for benefit of farmers. As for grocery startups, the government’s move comes with a catch since it allows FDI in only retailing of food products, while most grocery startups sell household items such soap and incense sticks apart from food. It remains to be seen whether they hive off a separate food business from their existing one, said industry experts. “It is a possibility, although at present, food accounts for around 70% of our business,” said Hari Menon, co-founder-CEO, Bigbasket. “If we manage to separate our food business from the rest of our portfolio, it will allow us to raise funds easily from foreign players.” Drew Kaser Womens Jersey
Foxconn goes slow on startup funding, invested only in 4 startups in India
In August last year, Terry Gou, chairman of Foxconn Technology Group, announced that the world’s largest electronics contract manufacturing company was in the final stages of investing in New Delhi-based refurbished goods seller GreenDust. The deal, estimated at $65-70 million ( Rs 430-460 crore), would have been the Taiwanese manufacturer’s second-largest investment in an Indian startup, next to its $200-million investment in online marketplace Snapdeal. But 10 months since, the GreenDust deal is yet to be closed. The maker of iPhones for Apple has invested in a mere four startups here since announcing ambitious plans for India more than a year ago, adding to domestic funding woes. “It seems that investing in India’s startup ecosystem has slipped down Foxconn’s pecking order,” said an investment banker who had advised multiple startups in their negotiations with the Taiwanese firm. “(Foxconn) had met dozens of startups (in India) over the past 12 months and not much seems to have been done since then,” this person said, requesting anonymity. Foxconn did not reply to an email from ET, seeking comment about its startup-focused investment plans for India. Apart from its investment in Snapdeal, Foxconn participated in a $9-million funding round in QikPod and invested undisclosed amounts in home automation startup eGlu and mobile internet venture MoMagic. These, however, are a far cry from the firm’s intention of investing $1 billion in Indian startups. In its core area of electronics manufacturing, though, Foxconn has announced plans to develop 10-12 factories and data centres in India by 2020. Hitendra Chaturvedi, chief executive of GreenDust, declined to comment on the proposed Foxconn deal, but said, “We have a high-growth, profitable business model and, therefore, having incoming investor interest is not uncommon.” In June last year, ET had reported that over a dozen Indian startups met Wen-Hsin (Vincent) Tong, chairman and director of investments at FIH Mobile Limited, an investment arm of Foxconn, at the New Delhi office of Snapdeal “The advantages of having a strategic investor on board are that it’s a great acknowledgement of the value of the business and a testament to what is being built. However, a premature announcement has the potential to stop every other conversation,” said Sandeep Murthy, partner at Lightbox. Foxconn’s $3.5-billion takeover of Japanese electronics manufacturer Sharp is cited as a leading reason for the company’s change in strategy, as it struggled to close a transaction that was dogged by last-minute disclosures and stiff competition from other suitors.Also, globally, tech stocks have dragged across major bourses, including on Nasdaq, posting sharp declines since February. Jessie Bates III Authentic Jersey
Gayatri Project wins Rs 700 crore contract for Navi Mumbai Airport
Infrastructure company Gayatri Projects said it has won Rs 700 crore project, a part of larger Navi Mumbai International Airport, from CIDCO. “Gayatri Projects has made inroads into the construction of airports by bagging a Rs 700 crore contract as part of the larger Navi Mumbai International Airport from City and Industrial Development Corporation of Maharashtra (CDICO),” the company said in a filing to the BSE. It said that winning the contract shows the company’s commitment to gain a foothold in relatively nascent, but fast growing EPC (engineering, procurement and construction) opportunity sets. “The construction and development of airports will prove to be a major source of business for infrastructure companies, given that the Indian aviation sector is likely to see investments of over USD 120 billion for the development of airport infrastructure and aviation navigation services over the next decade,” it said. The work order pertains to land development of Navi Mumbai International Airport. Gayatri is keen to participate in this effort to make India the third largest civil aviation market by 2020, which will involve the development of many greenfield airports as well as the improvement of existing ones, the company said. James Van Riemsdyk Womens Jersey
IWAI inks pact with IPGPL for Kaladan multimodal transit work
To bolster ties with Myanmar, the Inland Waterways Authority of India has entered into an agreement with India Ports Global Private for a Rs 476-crore project to facilitate connectivity and trade, the government today said. “A memorandum of understanding (MoU) was signed between IWAI and IPGPL on June 1” for projects worth Rs 476 crore, the Ministry of Shipping said in a statement. The Kaladan Multimodal Transit Transport Project (KMTTP) in Myanmar was conceptualised and is being administered by the Ministry of External Affairs (MEA) with a view to facilitating connectivity between the mainland and the North-East through maritime shipping, inland waterways and roads of Myanmar. The link between the north-eastern states of India and Myanmar will pave the way for enhanced trade and commerce across the border and enable cultural and social integration at the regional level, it said. MEA had appointed the Inland Waterways Authority of India (IWAI) as the Project Development Consultant (PDC) for implementation of the Port and Inland Water Transport (IWT) component of the Kaladan Project in 2009 and later, in April 2016, another agreement was signed. India Ports Global Private (IPGPL) has been established as a JV between the Kandla Port Trust and the Jawaharlal Nehru Port Trust for the purpose of development of ports overseas. IPGPL was asked to partner with IWAI in the Kaladan project as a sub-PDC. This was suggested mainly to use and develop capabilities of IPGPL that has been created with an aim to complete implementation of the Kaladan project within the scheduled timeframe of April 2019 and ease pressure on IWAI, given announcement of 106 new National Waterways and execution of the ambitious Jal Marg Vikas project. Under the MoU, the work includes container handling facilities at Sittwe and Paletwa, operation and maintenance of the completed works and wreck removal, the government said, adding that IWAI shall remain as the overall PDC to MEA for implementation of port and IWT component of the Kaladan project.
Govt plans incentive to shift cargo transport from roads to waterways
The shipping ministry plans to offer companies an incentive of Rs.1 per tonne per km to transport goods, including foodgrain, automobiles, cement and other commodities, through inland waterways and coastal shipping. The proposal has been discussed with stakeholders in the transport industry and would soon be presented before the cabinet for its approval. “It is not a subsidy but an incentive being given to the industry for switching to cleaner transportation like inland waterways and coastal shipping from railways and roadways,” a shipping ministry official said on condition of anonymity. With the infrastructure available at present, the incentive offer would cost the shipping ministry Rs.100-150 crore per year during the initial years. At present, just 6% of freight transported in India is carried by coastal shipping and inland waterways; the comparative share in Germany and China is 11% and 24%, respectively. Road freight accounts for 54% and railways 33% of the cargo transported in the country, with the remaining 7% sent through pipelines. A shift from roads and railways to coastal shipping and inland waterways could lead to emission savings of about 3.5% in the freight transport sector, says a shipping ministry presentation. It also suggested a reduction in the cost of coastal shipping by changing the so-called cabotage law, under which only Indian-registered ships are allowed to ply on local routes for carrying cargo. The presentation said that the proposed incentive would also help to increase transportation of petroleum, oil and lubricants (POL), coal, steel and cement by coastal shipping from 6 to 12% in a span of a decade and result in potential savings of Rs.35,000-40,000 crore by optimizing export-import freight and domestic cargo. The government has envisioned increasing the share of waterways transportation from 6% to 10% by 2020. To reach this target, the shipping ministry will now take several steps like moving to larger barges and use of liquefied natural gas instead of diesel barges and dedicated berths, bunkering and storage capacities at relevant ports for commodities to be transported through coastal and inland waterways. The ministry would also suggest the imposition of green taxes on less environmentally friendly modes of transport such as roadways. Additional secretary of shipping Alok Srivastava declined to comment on the proposals which he said were still being finalized. “We did hold a workshop today with all stakeholders and they were quite clear that financial incentives need to be granted to the freight owners to provide a level-playing field for water transportation,” he said, without elaborating. According to the shipping ministry, transportation by waterways would cost 25 paisa per km, by rail and road it’s Rs.1.50 and Rs.2.50, respectively. In terms of fuel efficiency, too, waterways compare favourably: one horsepower can ferry four tonnes of cargo by waterways, while the equivalent is 150kg and 500kg by road and rail, respectively. Jamie Collins Womens Jersey
Domestic air traffic: How IndiGo, Jet Airways, Air India, Go Air, AirAsia India, Vistara performed in May
More and more people are flying in India as is evident from yet another month of double-digit growth in May. Indian air carriers flew 86.69 lakh passengers during the month, 21.63 percent more than 71.29 lakh passengers last May, according to government (DGACA) data. Relaxation of FDI norms for the aviation sector buoyed stock prices of Jet Airways, SpiceJet and Indigo-parent Interglobe Aviation on Monday on the BSE. At around 3.10 p.m., SpiceJet share rose 7.82 percent to trade at Rs. 69.60, Jet Airways was up 6.53 percent at Rs. 585.90 and Interglobe Aviation had gained 5.92 percent to trade at Rs. 1,070.20. Indigo maintained its leadership with a market share of 38.5 percent in May, carrying 33.37 lakh passengers. However, it marked a marginal decline from 38.7 percent in April. State-run Air India increased its share for the third month in a row to 15.6 percent in May, while Jet Airways, the second-biggest carrier, also saw its market share go up to 16.1 percent last month from 15.9 percent in April. SpiceJet’s share declined to 12.6 percent in May from 12.9 percent in April. Go Air also saw its share fall marginally to 8.1 percent from 8.5 percent in April. AirAsia India and Vistara — the two ventures in which the Tata Group has stakes — improved their share to 2.2 percent and 2.5 percent, respectively, from 2.1 percent and 2.3 percent. In absolute terms, Jet Airways flew 13.94 lakh passengers while Air India carried 13.49 lakh passengers, indicating that the gap between the two full-service airlines is narrowing. Chandler Jones Womens Jersey