Inflation falls below 5% in May

Inflation fell to 4.85 percent for the week ended May 26, as against 5.06 percent in the previous week. This is the sixth straight week in which inflation gone down. Official data shows that a year ago, in the same period, inflation rate was 4.99 percent. Also, it is for the first time in eight months that inflation has gone below the five percent mark.

The Whole-sale Price Index (WPI) for all commodities, for the week under consideration, declined by 0.1 percent. The index for primary articles declined by 0.3 percent. The index of food articles group declined by 0.5 percent. Prices of essential food items like pulses, fruits and vegetables declined during the week under consideration. However, the index for non-food articles group rose by 0.2%. Prices of barley, urad, bajra, maida and suji have also became cheaper.

Source : Deccan Chronicle

ISB Admissions - Some Pertinent Questions

My First Post on this Blog.


Life at ISB currently is all about End Term Exams as the First Term Ends this week and your truly is trying level best to prepare for it. So I am just reproducing a post from my blog on the pertinent questions that all of us have about ISB. Some of these hopefully I will answer in my subsequent posts for the readers of this blog.



There are some pertinent questions that all aspirants to ISB (or maybe any B-School) have:

1. Is my Profile Good enough to get shortlisted in ISB?
2. Will I get through to ISB?
3. What can I do to improve my profile to get into ISB?
4. What GMAT Score is good enough for my Profile or what is the minimum for ISB?

and I think once a person is near selection or is selected

1. What is the payoff for this ISB - MBA?
2. What salary can I expect in the placements at ISB?
3. Is it worth it?

The funny and the frustrating part of this exercise is that you can easily guess the answers to these questions yourselves.

"IT DEPENDS"

This, I am sure, is true of any Business School and any profile. There obviously are some of the general concepts that you should know about.

ISB values its diversity a lot. What it cannot make up in the international diversity it makes up in its profile diversity. We have more than 10 doctors (experienced Surgeons etc), 60+ CAs who have diverse experience themselves, IIT Engineers with wonderful backgrounds, Journalists, Economists, Entrepreneurs, Consultants etc etc. Thus if you can add to this diversity then you are always welcome. However this does not mean that if you have a background that very few on this planet may have you have an automatic entry (the other criteria of Leadership ability, Need to do a MBA, recommendations etc are required)

This also does not mean that male IT Engineers are shooed away as is the common misconception. Nearly 50% of the batch is from a IT Background. But you still need to distinguish yourself from others and remember that the competition is tough. One of own Study group mates is an IIT Engineer - 4 yrs Infy - and not a out of the roof GMAT score. However he is "Brilliant" otherwise.

I hope one day I get the time to write about what I think one should do to stand out in this competition. (My views obviously)

Farming sector is heading for government tax sops

On the back of a retail big bang near the horizon, the government wants to boost the slagging agriculture sector by way of tax sops. In order to strengthen the linkage between industry and agriculture, certain agriculture zones may receive tax holidays on the lines of incentives available for certain industrial units. The government is considering a proposal to grant five-to-ten year tax holidays in semi-arid and arid regions of the country to attract corporate investments in the farm sector. These incentives will be available for companies investing in contract farming. Proposed incentives include a weighted deduction of 150% for expenditure incurred in the development of farm lands in semi-arid regions and 200% for such expenditure in arid regions of Rajasthan and Gujarat. Besides, investment in these areas may also be considered for cheaper loans from banks as part of their priority sector lending norms.

The proposed move is part of a long-term agricultural strategy being finalised by the governemnt to increase the growth rate of the sector (currently around 2%) and achieve the targeted 4% growth during the 11th plan. Once the plan is approved by the National Development Council (NDC), it will encourage large companies like ITC, Reliance and Bharti to increase their exposure to the agriculture sector. It would also encourage development of farming infrastructure in dry area that contribute 40% of total food production of the country at present. The idea is to offer sops to private sector investors for increasing production in cultivable arid and semi-arid areas and bringing degraded land under cultivation. As per the government estimates, out of the total land area, while 43% is cultivable, another 45% is degraded land.

Source : The Economic Times

Related Articles:-

• 11th Five Year Plan (2007-12) - Reports & Recommnedations of the working Groups
• Report of the Working Group on agriculture marketing infrastructure and policy rquired for internal and external trade (11th Plan)
• Towards Faster and More Inclusive Growth - An Approach to the 11th Five Year Plan (2007-2012)
  

UB takes 26% stake in Air Deccan

Deccan Aviation Ltd, the company that runs low-cost carrier Air Deccan, on Thursday announced it has sold 26 per cent in the airline to Vijay Mallya's UB Holdings for Rs 550 crore. UB Holdings has already paid Rs 150 crore and the remaining amount would be paid in the next three months, Air Deccan Managing Director G R Gopinath told reporters after the company's board meeting. The transaction, which values Air Deccan at Rs 155 a share, would be through allotment of non-preferential shares to UB, he said. UB Group runs the premier full-service, true-value carrier Kingfisher Airlines. The combined market share of both the airlines will be around 34% (Air Deccan - 22-24% and King Fisher - 11-12%).

Related Articles:-

• Deccan, UB shares soar 10% on merger news - The Economic Times
• Deccan Aviation offers 26 p.c. stake to UB - The Hindu
• Kingfisher buys 26 pc share in Air Deccan - Deccan Herald
• Capt Gopi, Co-Promoters' stake value at today's price - The Economic Times
• 'UB deal is not about losing control' - Capt. Gopinath - The Economic Times
• Cash-starved Deccan gets breathing space - The Economic Times

India's GDP beats forecast with highest growth rate of 9.4% in 18 years

The Indian economy grew a whopping 9.4% in 2006-07, faster than the advance estimate of 9.2%, pushing the absolute size of the economy to Rs 40 lakh crore or $1 trillion, at current market prices. Savings and investment touched record levels, at 32.4% and 33.8% of GDP respectively. The only time the economy has grown faster was in 1988-89, when the growth rate touched 10.5%, recovering from a crippling drought the year before. In contrast, the growth in 2006-07 comes on top of 9% growth the year before, 7.5% the year before that and 8.5% in 2003-04.

Moreover, per capita income has registered a growth of 8.4% last fiscal, which is historic by Indian as well as world standards. Manufacturing and services drove the surge, while farm growth actually slackened, as compared to 2005-06.

Finance minister P Chidambaram said the results confirm the belief that the “Indian economy has shifted to a higher growth trajectory.” The minister emphasised the criticality of growth, saying “high growth generates its own momentum. With high growth comes high investment, which, in turn, reinforces growth itself.” Mr Chidambaram drew attention to the linkage between high growth and high prices, saying that “high growth leads to high demand which puts pressure on prices until supplies catch up.” Asked if the growth rates in the current fiscal would be higher, the minister said, “We have capacity to grow at the same high rate of growth, but whether objective conditions will be able to deliver a growth rate higher than 9.4%, I can’t say. The aim is to keep the growth rate at a level higher than 9%.”

According to data on revised estimates of annual national income, released by the Central Statistical Organisation (CSO) on Wednesday, the manufacturing and services sector grew by 12.3% and 11% respectively in 2006-07. While the estimates for manufacturing are higher than 11.3% projected earlier, the growth of services was estimated higher previously at 11.2%. “Consumption and investments, both have driven growth. The 9.4% growth is a step up from the previous estimate of 9.2% owing to the robust growth of manufacturing,” economic advisory council member Saumitra Chaudhary said. Real per capital income, which reflects the average income of each individual in the population, also clocked in a higher growth of 8.4% in 2006-07 compared to 7.4% in 2005-06 and 5.7% in 2004-05.

DK Joshi, principal economist, Crisil, said, “The growth is mainly powered by the non-agricultural sectors such as manufacturing and services, especially telecom, trade and construction.” This also shows that monetary tightening measures taken by the RBI is yet to impact growth, he added. Mr Chidambaram said, “The time has come to shed lingering doubts about the sustainability of high growth and scepticism about the shift to a high growth trajectory.” “I would argue that the high growth that we have witnessed in the three years of the UPA government needs to be sustained with utmost care, because that is the way forward to eradicate poverty, generate quality jobs and improve the human development indicators,” the minister continued. The need for inclusive growth was reiterated. Releasing the audited figures for fiscal and revenue deficit, the minister said while fiscal deficit was 3.5% of GDP, revenue deficit, as reported by the controller general of accounts, stood at 2%, better than the budget estimates of 2.1%.

Allaying fears about the adverse impacts of the rising rupee on certain sectors, Mr Chidambaram said the government has taken note of concerns of one or two sectors that have been affected and that their problems would be addressed. “I have received representations regarding textile exports,” he said. The rupee has been strengthening against the dollar for the last couple of months, touching a nine-year high of Rs 40.28 per dollar early this week. Financing, insurance, real estate and business services clocked in a high of 10.6% in 2006-07, down from the earlier estimates of 11.1% and a little higher than 10.9% achieved in 2005-06. Mining and quarrying grew by 5.1% (3.6% last year), while electricity, gas and water supply grew at 7.4% in 2006-07 as against 5.3% last fiscal.

Referring to the excessive foreign fund inflow on account of borrowings by Indian companies in the last fiscal, the minister said, “It reflects the ability of Indian industry to attract capital at very competitive rates. However, the other side is that it increases money supply and puts pressure on managing the supply. This involves a tight balancing act between the RBI and government. We’ve been fairly successful in balancing the need for capital and to maintain price stability. We need to continue to do the balancing act, we cannot turn away capital.” Inflows through the external commercial borrowings window crossed $25 billion in the last fiscal, way above the government’s internal cap of $22 billion.

Source: The Economic Times

Related Articles :-

• GDP growth at 9.4% in 06-07 - The Statesman
• India's GDP expanded at fastest pace in 18 years - Marketwatch
• Q4 FY07 GDP growth seen at 9.1% - moneycontrol.com
• Economy grows @9.4 pc, India inc upbeat
• India's GDP growth in FY08 seen at 9.2 pct - CII - Reuters
• India's GDP grew by 9.4% in 2006-07 - Rediff News