IndUS Business Journal

Modi to open Make in India Week in Mumbai on Saturday

Feb 12, 2016 0

MUMBAI–Prime Minister Narendra Modi will on Saturday inaugurate the Make in India Week 2016 being organised to give further momentum to the initiative, which has seen the country trump the US and China by attracting FDI worth $31 billion in the first half of 2015.

The prime ministers of Finland, Lithuania and Sweden will be among the top dignitaries from across the world who will be attending the Make in India Week being held from February 13 to 18, the Prime Minister’s Office said in a statement in the national capital.

Indian Prime Minister Mody

Indian Prime Minister Mody

Billed as the biggest promotional effort so far in the country of the government’s Make in India initiative, over 1,000 companies are expected to showcase their achievements at the event, which is themed “Innovation, Design and Sustainability”.

Around 70 countries will participate in the event, to be held at the Bandra-Kurla Complex here. Among these, Australia is sending delegation of 30 government and business leaders representing a range of expertise in multiple sectors.

The event will also have various states and sectors making a pitch for investments through specially organised seminars.

During the event, America’s Time magazine will for the first time give away their Time India Awards selected under the three separate categories of innovation, entrepreneurship and intelligent manufacturing.

US-based Forbes magazine in their latest annual list of the best countries for doing business in 2015 has ranked India 97th out of 144 nations, behind Kazakhstan and Ghana, scoring poorly on categories like trade and monetary freedom and tackling challenges like corruption and violence.

Forbes said that while the country is developing into an open-market economy, traces of its “past autarkic policies” remain.

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US Agency and Andhra Pradesh to develop Visakhapatnam as smart city

Feb 12, 2016 0

VISHAKHAPATNAM–The US Trade and Development Agency (USTDA) and Andhra Pradesh government on Friday signed an MoU for developing Visakhapatnam as a smart city.

The USTDA signed the MoU with the department of municipal administration on funding for drawing up master plan for Visakhapatnam smart city.

Leaders in the smart grid arena AECOM, IBM and KPMG will provide Vizag with a planning framework and development strategy for several high-priority investment projects for smarter urban development.

The agreement was signed by Principal Secretary, Municipal Administration, Karikal Velavan and USTDA country manager Heather K. Lanigan in the presence of Chief Minister N. Chandrababu Naidu, USTDA director Leocadia I Zak and US Ambassador to India Richard Verma.

The MoU will advance Visakhapatnam’s efforts to make it more efficient and sustainable through the development of interconnected infrastructure, communications and data systems.

Vizag was one of the 20 cities named by the central government last month under the first phase of smart cities programme.

Speaking on the occasion, Naidu said Vizag would be developed into one of the finest smart cities in the country with the assistance of the US. He said the project offer great opportunities for the US companies.

“We are proud of our cooperation with the state government of Andhra Pradesh and the important role our partnership will play in advancing one of India’s highest economic development priorities.A By bringing together the right private sector expertise and a committed partner, the opportunities for growth are limitless,” said Zak.

This cooperation is one component of a multi-faceted effort by USTDA to support the development of smart cities in Andhra Pradesh, Uttar Pradesh and Rajasthan.

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Report: New Skilled Workforce, Training Needed for India’s Ambitious Renewable Energy and Climate Goals

Feb 12, 2016 0

MUMBAI – India’s goal to dramatically expand solar energy could trigger a green jobs boom adding one million new engineers, technicians, solar installers, maintenance workers and performance data monitors to its workforce, according to a new report released in connection with a “Make in India” conference in Mumbai.

The report by Natural Resources Defense Council and the Council on Energy, Environment and Water outlines the types of new jobs and new training facilities and institutes needed for India to reach its ambitious national target to add 100 gigawatts (GW) of installed solar energy by 2022.

New jobs that would be needed includes up to 210,800 skilled plant design and site engineers; 624,600 semi-skilled technicians for construction of solar projects; and 182,400 workers in various low-skilled jobs such as ongoing operations and maintenance for both rooftop solar and utility-scale solar projects, according to the report released this week.

“India has a tremendous opportunity to demonstrate how a growing economy can scale up green energy—creating hundreds of thousands of jobs and boosting renewable power—and protect our climate while meeting rising energy demands,” said Nehmat Kaur, NRDC India Representative. “This comprehensive assessment of the variety of jobs, skills and training that needed as India expands its solar industry will help realize Prime Minister Narendra Modi’s vision to transition to a low-carbon economy.”

The report’s findings come on the heels of Modi’s announcement in December at the Paris climate talks that India was launching an International Solar Alliance (ISA). The alliance of more than 120 solar-rich countries aims to facilitate widespread deployment of solar power and supporting knowledge exchange on manufacturing and skills.

The India-led alliance has already met twice, demonstrating the momentum India is building to reach its climate commitments. In addition to India’s solar leadership, the prime minister is inaugurating the “Make in India” conference in Mumbai this weekend to boost renewable energy and national manufacturing capabilities.

“Make in India is not just about increasing domestic manufacturing, but also about preparing a market that is conducive to the scaling up of renewable energy capacity,” said Shri Upendra Tripathy, Secretary, Ministry of New and Renewable Energy (MNRE) in India. “The International Solar Alliance also recognizes the importance of capacity building, with skills and training being central to its work. In this context, this timely report outlines the nature of skills essential for increasing renewable energy deployment in India and lays out a roadmap to upgrade these skills.”

The report, Filling the Skill Gap in India’s Clean Energy Market: Solar Energy Focus, provides details about how India’s 100 GW solar target would generate more than 1 million jobs by 2022, primarily in two key phases of a solar project’s lifecycle: construction and commissioning (806,800, accounting for 72% of new solar jobs) and ongoing operations and maintenance (263,400, 23% of new solar jobs). These projections do not include jobs created in the manufacturing sector, another significant jobs opportunity. Forty solar companies were surveyed to formulate this analysis, in addition to multiple roundtable discussions with industry and government representatives.

The new report also describes the institutions and programs needed, including key skills and locations, to train and educate this new clean energy workforce. Recognizing the vast number of jobs that a scaled up clean energy market would create, the Government of India has formed a Skill Council on Green Jobs and introduced several domestic initiatives such as Skill India that support manufacturing, job creation and skill development.

Dr. Praveen Saxena, CEO of the Skill Council for Green Jobs, emphasized that, “The CEEW-NRDC report is giving us insight into the solar and wind skill requirements. In fact, it sets goals for the Skill Council and gives us a roadmap.”

Dr. Arunabha Ghosh, CEO, CEEW, added, “Without Skill India, it would be difficult to meet Make in India’s targets for the renewable sector. There is a clear need for improved training and certification programs, which are accessible to workers of varying backgrounds and skillsets in all states. Policymakers should also consider establishing at least one prominent solar training institute in each of the renewable energy clusters of the country.”

Anjali Jaiswal, NRDC India Director, said: “Renewable energy offers a critical solution to rising energy demands, threats to energy security and the impacts of climate change. Innovative clean energy solutions, including large solar parks and rooftop solar panels in dense urban areas, can help solve these challenges, while increasing energy access, creating jobs, and reducing harmful pollution.”

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Gold rises to highest level in year as US equities fall sharply

Feb 11, 2016 0

CHICAGO–Gold futures on the COMEX division of the New York Mercantile Exchange rose sharply on Thursday as US equities took a sharp downturn in reaction to a decreasing cost of oil.

The most active gold contract for April delivery rose $53.2, or 4.45 percent, to settle at $1,247.80 per ounce.

This settlement is gold future’s highest level since February 5, 2015.

The feature of the day has been economic instability and gold is up sharply because of it, analysts said.

The US Dow Jones Industrial Average took strong pressure from the falling price of oil and at one point had fallen by more than 300 points. As of 19:00 GMT, the Dow Jones had lost 1.71 percent.

Analysts noted that when equities post losses, the precious metal usually goes up, as investors are looking for a safe haven, while the opposite is true when US equities post gains. Traders are in the process of rushing to the precious metal because of it’ s safe haven properties.

Gold was given further support on US Federal Reserve’s Chairwoman Janet Yellen’s testimony to Congress. Prior to Yellen’s address to the U.S. Congress on Wednesday, the central bank hinted that it could still raise rates in March. However now that Yellen testified to Congress that the increases would be gradual, many analysts believe that the next rate hike will occur much later in the year.

Silver for March delivery rose 51.2 cents, or 3.35 percent, to close at $15.794 per ounce. Platinum for April delivery added 29 dollars, or 3.1 percent, to close at $963.20 per ounce.

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India, UAE sign nine agreements, to boost ties further

Feb 11, 2016 0

NEW DELHI– Nine agreements were exchanged between India and the UAE, including on cyber security and infrastructure investment, as the two sides agreed to further boost bilateral ties on Thursday, the second day of the three-day visit of Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Commander of the UAE Armed Forces.

Apart from cyber security and infrastructure investment, the other agreements are for cooperation in the areas of renewable energy, space exploration, insurance, culture, skill development, trade and business, and currency swap arrangement, according to the ministry of external affairs.

Prime Minister Narendra Modi and Sheikh Mohamed held bilateral talks at Hyderabad House here during which the two leaders discussed ways to promote bilateral cooperation.

The two leaders agreed that promoting bilateral cooperation would drive forward the strategic partnership between the United Arab Emirates and India. The two leaders also discussed a number of regional and international issues of mutual interest.

Modi expressed his happiness on the occasion of this important visit which would serve the interest of the two nations. He also praised the special relationship the UAE and India enjoy.

Sheikh Mohamed was accompanied in the visit by Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, crown prince of Dubai, Sheikh Saif Bin Zayed Al Nahyan, UAE deputy prime minister and minister of interior, and Sheikh Hamed bin Zayed Al Nahyan, chairman of the Abu Dhabi’s Crown Prince Court among others.

Sheikh Mohamed expressed his happiness on visiting India, saying that the country has a special relationship with the people of the UAE and the Arabian Gulf dating back centuries.

He added that this deep-rooted relationship has helped to strengthen the bonds of friendship that the two nations enjoy today.

He said the UAE, under the leadership of President Sheikh Khalifa bin Zayed Al Nahyan, was keen on pushing its relationship with India forward on the solid basis of mutual respect and common interests. He also commended the contributions of the Indian community to the development and growth of the UAE.

There are around 2.6 million expatriate Indians in the UAE, 60 percent of whom are blue collar workers.

The two leaders also discussed regional and international issues, including current developments in the Middle East such as violence and terrorism.

The two leaders concluded their talks by stressing that the two nations have passed a milestone in the path of their strategic relationship, expressing their keenness on pushing this relationship forward.

They also agreed that it was important for the international community to exert more efforts to achieve stability and security at the regional and international levels and to confront the challenges that the people of the world face, including the menace of terrorism, extremism and violence.

Sheikh Mohamed’s is the second highest level visit to India from the Gulf region after the visit of the emir of Qatar in March 2015.

The region, which hosts seven million expatriate Indians and is an important source of remittances, has a strong bearing on India’s security and stability in its neighbourhood.

The UAE is the third largest trading partner of India after the US and China and also the sixth largest source of India’s crude oil imports.

While Thursday’s memorandum of understanding (MoU) on cyber security provides for technical cooperation in cyber space and in combating cyber crime, the one on infrastructure investment aims at establishing a framework for facilitating the participation of UAE institutional investors in infrastructure investments in India.

During Prime Minister Narendra Modi’s visit to the United Arab Emirates (UAE) in August last year, the first by an Indian prime minister in 34 years, the Gulf nation committed $75 billion in investments in India’s infrastructure sector.

A framework agreement on renewable energy provides for bilateral cooperation through extensive projects, investments, cooperation in research and development in renewable and clean energy.

Another MoU establishes a framework for cooperation in space science, technology and applications including remote sensing, satellite communication and satellite based navigation.

Earlier on Thursday, after being accorded a ceremonial welcome at Rashtrapati Bhavan and paying floral tribute to Mahatma Gandhi at Rajghat here, the crown prince held a restricted meeting with Modi.

Following this, he called on President Pranab Mukherjee at Rashtrapati Bhavan.

During the meeting, Mukherjee, who hosted a private lunch in honour of the visiting dignitary, expressed “great satisfaction” at the elevation of the relationship between India and the UAE to a comprehensive strategic partnership during Modi’s visit last year.

The crown prince later also met Vice President Hamid Ansari at the latter’s residence here during which the two leaders discussed friendly ties and cooperation between the UAE and India as well as ways to promote them in order to achieve common interests.

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Wipro to Acquire US Firm HealthPlan Services for $460 Million

Feb 11, 2016 0

SOMERSET, N.J.—Wipro Limited, a leading global information technology, consulting and business process services company, announced that it has signed a definitive agreement to acquire HealthPlan Services from Water Street Healthcare Partners, a strategic investor focused exclusively on the health care industry.

Since partnering with Water Street in 2008, HealthPlan has grown to become the leading independent technology and Business Process as a Service (BPaaS) provider in the U.S. Health Insurance market. As part of the agreement, Wipro will acquire 100% of HealthPlan Services’ shares for a purchase consideration of USD 460 million.

Jeff Bak

Jeff Bak

Headquartered in Tampa, Florida, HealthPlan Services employs over 2,000 associates. HealthPlan Services offers market-leading technology platforms and a fully integrated Business Process as a Service (BPaaS) solution to Health Insurance companies (Payers) in the individual, group and ancillary markets. HealthPlan Services BPaaS solutions are ideal for payers who want to operate in the private and public exchanges and the off-exchange individual market in the U.S.

HealthPlan Services connects its payer clients to over 40 public exchanges and over 150 private exchanges in the U.S. HealthPlan Services has powered many of these payers to achieve desired membership growth, while keeping their administrative costs predictable.

The Patient Protection and Affordable Care Act has dramatically altered the health insurance landscape in the U.S. The post-reform individual market is growing at a fast pace and is expected to continue to grow in coming years. By partnering with HealthPlan Services, Wipro gains the competitive, first-mover advantage in the high growth public and private exchange space for individual, group and ancillary markets. This partnership also strengthens Wipro’s payer portfolio, with access to HealthPlan Services’ payer clientele.

Wipro Logo

Wipro Logo

This transaction is closely aligned with Wipro’s key levers for growth, which are to dominate the services market through industry utilities that multiple customers can use. This acquisition adds another platform-led Business Process as a Service (BPaaS) offerings, delivered on cloud to Wipro’s services portfolio. Wipro’s clients currently include over 100 U.S. payers, leading healthcare providers, and public health agencies.

“The partnership with HealthPlan Services positions Wipro to participate in the shift of the US health insurance industry towards a consumer-centric business model. HealthPlan Services strengthens Wipro’s position in the health insurance exchange market while offering synergies with Wipro’s presence in the Managed Medicare and Commercial Group Insurance markets. The addition of HealthPlan Services’ capabilities complements Wipro’s strengths in claims processing and back office services. This is a strategic move for us, as it advances Wipro’s vision of leveraging unique insights into customer buying behavior and applying this across the healthcare value chain. This will help us lower the cost of healthcare and transform the quality of the member experience,” said Jeffrey Heenan Jalil, Senior Vice President & Head – Healthcare Life Sciences and Services, Wipro Limited.

“We welcome the HealthPlan Services team to the Wipro family. Over the past eighteen months we have transformed our BPS business into a platform-led BPaaS business with a strong focus on the healthcare services market. This transaction will help us become the leader in administrative service in the U.S. health insurance industry. The partnership with HealthPlan Services also reinforces our commitment to the US market by creating jobs and value within the US economy,” said Nagendra Bandaru, Senior Vice President and Head – Business Process Services, Wipro Limited.

“We are excited about what Wipro and HealthPlan Services can accomplish together for our customers and employees,” said Jeff Bak, CEO and President of HealthPlan Services. “The combination creates the first true end-to-end solution in the individual under 65 commercial market and the governmental over 65 and Medicaid markets. Together, Wipro and HealthPlan Services will give payers the power to accelerate growth strategies while providing both Business Platform as a Service (BPaaS) and competitive administrative service solutions. We are delighted that Wipro believes in our talented people, strategic vision, corporate culture and business fit to help insurers succeed in a consumer-centric world.”

This transaction is subject to customary closing conditions and regulatory approvals and is likely to be completed in next 60 to 90 days.

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HHM Acquires Cambridge Hotel

Feb 11, 2016 0

CAMBRIDGE, MA—HHM, formerly known as Hersha Hospitality Management that operates 115 hotels across the United States, announced that it now owns and manages the Best Western Tria in Cambridge, MA, further expanding its private-investment platform and management footprint in the dynamic Boston market, HHM said in a statement.

The company plans to extensively renovate the 121-room property, with upgrades to the guestrooms, public areas and exterior façade that represent the style and vibrancy of the Cambridge community.

Naveen Kakarla

Naveen Kakarla

The Best Western Tria marks HHM’s eighth hotel in the Boston area, including the Boxer in the historic North End, the Courtyard Brookline, and the nearby Holiday Inn Express Cambridge. The newly acquired hotel was fully rebuilt in 2009 and now includes a Starbucks and an upgraded fitness center.

HHM’s acquisition was led by Shawn Tuli, Vice President of Acquisitions and Development, who grew up as a Cambridge local and is also an alumnus from nearby Harvard Business School.

“We are very excited to make an investment and further expand our roots in the Boston area, and have comprehensive plans to position this hotel to be a critical part of West Cambridge’s cultural fabric,” said Shawn Tuli. “On a personal level, I am overjoyed to be a part of a project that will offer improved amenities to a community that has given so much to me.”

The hotel is located in the Alewife neighborhood of West Cambridge and is close to Harvard University, MIT, Tufts, Boston University and Lesley University. West Cambridge has extremely high barriers to entry, and exhibits attractive residential, retail, and office characteristics with reputable tenants such as Forrester Research, headquartered a short distance from the hotel. The hotel is also in close proximity to Boston’s prominent red line, providing easy access to the city’s most trafficked locations such as Harvard Square, Boston Common, and South Station.

Hotel Tria

Hotel Tria

“We are thrilled to expand our investment platform into the Boston market and to be a part of Cambridge’s thriving market,” said HHM CEO Naveen Kakarla. “We look forward to developing unique programming throughout the hotel, which will appeal to locals, support the community and provide travelers with an authentic experience.”

The acquisition of the Best Western Tria comes shortly after HHM’s recent acquisition of the Residence Inn Philadelphia Conshohocken. The company also recently expanded its management and private investment portfolios in Florida, where in the past six months it assumed management of the Hilton Daytona Beach Resort and acquired the Sheraton Miami Airport Hotel and Executive Meeting Center.

HHM, formerly known as Hersha Hospitality Management, operates 115 hotels across the United States. Headquartered in Philadelphia, PA, the company has a private investment platform and engages in hotel acquisitions, management, asset management, and receivership for full-service and select service in top 25 markets. HHM also operates 28 independent hotels ranging from The Rittenhouse Hotel, a AAA Five Diamond property in Philadelphia, to the Larkspur Landing hotels, all-suite extended stay properties in Northern California and the Pacific Northwest.

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India Passes U.S. and China in Smartphone Market and Growth, Respectively

Feb 11, 2016 0

India Passes U.S. to Become World’s 2nd-largest Smartphone Market

India has toppled the U.S. to become the second-largest market for the devices. Smartphone shipments to the world’s fastest growing large economy grew 15% annually during the October-December period of 2015, taking the user base to 220 million, according to new data from Counterpoint Research.

India Overtakes China as World’s Fastest-Growing Major Economy

India has overtaken China as the world’s fastest-growing major economy, expanding by 7.3 percent and cementing its position as one of the sole bright spots in a flailing global economy. Economic growth is now expected to hit a high of 7.6 percent in 2016, according to Delhi’s Central Statistics Office.

Minister: India Sitting on Cusp of Digital Revolution

India is sitting on the cusp of a “digital revolution,” Union Minister for Communications and IT Ravi Shankar Prasad has told leading IT firms, asking them to take advantage of the “Digital India” initiative and tap the growth opportunities in the country. Speaking at the roundtable for top U.S. and Indian IT firms, hosted by the U.S.-India Business Council in Massachusetts, Prasad said that there are tremendous growth opportunities in India.

Intl. Fleet Review Brings Together World Navies

Addressing the Indian fleet during the 2016 International Fleet Review (IFR 2016), President Pranab Mukherjee said that IFR 2016, while showcasing the prowess of the Indian Navy, has brought together navies from across the globe here on Indian shores, signifying our common desire to use the seas to promote peace, cooperation and friendship. In addition to 65 Indian Naval warships and three IN Submarines, the Review also included 24 foreign ships.

India Gets More Voting Rights at International Monetary Fund (IMF)

Voting rights of emerging-market economies such as India and China have increased at the International Monetary Fund (IMF), which has notified governance quota reforms adopted in 2010. India’s share at IMF has now increased to 2.75% from 2.44%, making it the eighth-largest shareholder in the multilateral agency, climbing three notches.

Railways-EtendersIndian Railways Launches E-tendering for Contracts

Indian Railways has launched an e-tendering portal to bring transparency to contracts and make the process cost-effective for bidders. It typically invites about 25,000 tenders a year, involving an expenditure of about $5.1 billion for upgrades and creation of new assets and other works.

RBI Proposes Easier Access to Foreign Capital for Start-Ups

The Reserve Bank of India (RBI) has proposed steps to improve ease of doing business for start-ups through easier access to foreign capital and by enabling smoother transfer of ownership. “We are supporting the start-up process by making it easier to raise (capital), often from abroad, but also simplify the compliance with regulations, including putting forms online,” said RBI Governor Raghuram Rajan.

Public Private Project Committee Clears Projects Worth $1.4 Billion

The Public Private Project Appraisal Committee and the Empowered Committee have cleared six road projects and one ports sector project with an estimated project cost of $1.4 billion. These include National Highway projects, State Highway projects and Port Sector projects.

Ease of Doing Business: Govt. Reviews 53-Year-Old Law

The Government has started reviewing a 53-year-old law dealing with specific fulfillment of a contract as part of its ease of doing business policy, days after commercial courts were established and arbitration law amended for faster disposal of business disputes. “The decision has been taken in view of tremendous developments that have taken place after 1963,” the ministry said in a statement.

Govt. Eases Duty Norms for Imported Goods for Exhibition

Seeking to promote ease of doing business, the tax department has permitted duty-free import of goods, including gems and jewelery, for display at trade fairs, craft exhibitions, film festivals or aero shows provided they are exported within six months.

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Bad loans exposing distress among Indian banks

Feb 11, 2016 0

By V. Jagannathan

CHENNAI– The distress in India’s banking system is becoming evident by the day with more of these financing institutions reporting poor results in the third quarter of this fiscal, amid mounting bad loans. What is more, the stress is more pronounced in state-run banks.

“Such reporting of losses by the Indian banks is unprecedented. The trend is clear — unfortunate that several public sector banks are posting negative results and wiping out the equity,” Saswata Guha, director of financial institutions at Fitch Ratings, told IANS.

Technically called non-performing assets, or NPAs, with only some subtle differences, the finance ministry’s own assessment is that these are growing — even though they are equally feared to be grossly under-estimated.

Guha expects the Indian banking sector to close this fiscal with a NPA of around a whopping Rs.4 trillion and total stressed assets of around Rs.9 trillion.

On Thursday, the trend of state-run banks declaring low profits or losses and the ever-ballooning provisions and NPA continued. The index for state-run banks of the National Stock Exchange fell 3.17 percent and that of the Bombay Stock Exchange was down3.81 percent.

In the past year, BSE’s banking index of Bombay Stock Exchange (BSE) has taken a 67 percent hit. In the case of Punjab National Bank, for example, the stock is down 58 percent, while for State Bank, it is down 52 percent.

Reserve Bank of India (RBI) Governor Raghuram Rajan sought to assuage the feelings. “The decline in bank share prices caused investors to panic. Bank share prices are being hit by the global markets turmoil,” Rajan said.

“We’re looking at banks having clean and fully provisioned balance sheets by March 2017. Banks are using tools devised to clean up their balance sheets.” Yet, Guha said government banks are aggressive on write-offs but not on recovery — not even a fifth of the write-offs.

Fitch Ratings’ Guha said the NPA levels do not seem to have plateued and may not go up sharply in the coming quarters. By 2017, it is expected that the balance sheets will become cleaner. The earnings outlook is also more daunting and the pain may continue during the next year.

“For government banks, the revenue is mainly from interest on loans whereas the private bank’s revenue stream is diversified,” Guha said, adding He said it is not that the private banks are immune to NPAs but their credit risk management is better than government owned banks.

Rajan said there was hope. “Change in attitude in the banking system takes time as banks try to unlock the value of their NPAs. But the end-game is in sight. We don’t envisage a further set of AQRs (asset quality review) and new loans that require to be dealt with.”

Rajan said public sector banks’ non-core credit grew at only 6.6 percent, while the same for the private sector was over 20 percent. The only reason for this is of managing stressed assets and some resulting risk aversion because of which public sector banks have curtailed lending.

“We have to clean up banks balance sheets to restore growth.”

Going by the finance ministry, the NPA Ratio of banks — net exposure versus bad loans — rose from 3.42 percent as on March 2013 to 4.62 percent as on the same month of last year. And in absolute terms, the ministry pegs it at Rs.1,83,854 crore versus Rs.3,09,409 crore.

Take the case of Punjab National Bank. Announcing the third quarter results, it said NPAs stood at Rs.22,983.40 crore on December 31, 2015, against Rs.13,787.76 crore in the like period of the previous fiscal — up a whopping 66 percent.

And State Bank of India (SBI), the country’s largest lender? The NPA at Rs.72,792 crore was 17 percent higher than Rs.61,991.45 crore at the end of December 2015, and 28 percent up from Rs.56,834 crore at the end of the quarter ended September 2014.

But the RBI’s Rajan has rubbished the suggestions that the NPA ratio could be at alarming levels.

“I think the 17 percent, 18 percent numbers maybe a little on the high side. But broadly speaking I think we should also be careful about treating any stressed asset as a total write-off,” he had told reporters earlier this month.

According to Guha, the next issue for state-run banks is the capital infusion. The government has said fresh capital infusion from the government will be based on good performance. “Our estimate is that the government infusion is sufficient,” Rajan said.

In the final analysis, Guha feels the situation may be ripe for consolidation in Inia’s e banking sector. “Let’s see if the government bites the bullet.”

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Ten steepest falls in key Indian equity indices since January 2015

Feb 11, 2016 0

The 10 steepest falls for two key stock market indices in India — the sensitive index of the Bombay Stock Exchange and the Nifty of the National Stock Exchange since january 2015, in percentage terms.

Aug 24, 2015: Nifty (5.92 percent), Sensex (5.94 percent)

Feb 11, 2016: Nifty (3.32 percent ), Sensex (3.40 percent)

Jan 06, 2015: Nifty (3.00 percent), Sensex (3.07 percent)

May 06, 2015: Nifty (2.74 percent), Sensex (2.63 percent)

Jun 02, 2015: Nifty (2.34 percent), Sensex (2.37 percent)

Mar 26, 2015: Nifty (2.21 percent), Sensex (2.33 percent)

May 12, 2015: Nifty (2.38 percent), Sensex (2.29 percent)

Sep 01, 2015: Nifty (2.33 percent), Sensex (2.23 percent)

Sep 04, 2015: Nifty (2.15 percent), Sensex (2.18 percent)

Jan 04, 2016: Nifty (2.18 percent), Sensex (2.07 percent)

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