Economy
Centre to use postal network for pulses distribution
The central government has decided to use postal network for distribution of subsidized pulses and release more chana from buffer stock to ensure availability of these commodities at reasonable prices during the ongoing festival season.
 
The decisions were taken at a meeting of the Inter Ministerial Committee on prices of essential commodities headed by Union Consumer Affairs Secretary Hem Pande here on Friday, an official source said. 
 
The committee at its meeting also reviewed availability and prices of essential commodities, specially pulses, and suggested that in the absence of government outlets in the states, postal networks should be used for the pulses' distribution.
 
The committee observed that there were declining trends in the prices of pulses in recent weeks. It also reviewed procurement arrangements of Kharif pulses by government agencies, an official release said.
 
It was informed that so far 500 procurement centres have been opened and farmers were being paid through cheques or bank transfer instantly. 
 
The meeting was attended by senior officials from the ministries of Agriculture, Food, Commerce, Revenue, Metals and Minerals Trading Corporation of India (MMTC) and National Agricultural Cooperative Marketing Federation (NAFED), the source said. 
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

User

COMMENTS

Deepak Narain

2 months ago

All kinds of odd things are happening nowadays. Next month, you may read public sector banks selected for selling vegetables.

Is RBI’s upward projection for inflation, deliberate?

The consumer price index (CPI) inflation for September 2016 declined to 4.31% compared with 5.05% in August due to continued moderation in prices of vegetables and pulses. However, the Reserve Bank of India (RBI) in its monetary policy earlier this month, had forecast consumer inflation at 5% for FY2017 with an expectation of some moderation to 4.5% by the end of FY2018. However, according to a research note, the deceleration in CPI shows that either the RBI's inflation projection was significantly off the mark or the central bank deliberately had an upward bias.

In its Ecowrap report, State Bank of India (SBI), says, "We estimate October 2016 CPI inflation number to be printing below 4%. If that is the case, another 25 basis points (bps) rate cut is on in December policy. But the bottom-line is that CPI inflation will possibly be sub 3.5% in November and will possibly stay between 3.5%-4% for next 2-3 months as well. Clearly, RBI inflation projection in October policy was significantly off the mark or deliberately had an upward bias."

 
"The other part of this story is that a lot of doubting Thomases and self-acclaimed inflation experts are now also toeing the same line: a 4% inflation number by November. But at the same time it is curious to see that a majority of such economists and analysts in India still feel eminently reluctant to vouch for an accommodative monetary policy regime even as inflations continue to surprise on the downside," the report added.
 
The difference between CPI and wholesale price index (WPI), which was as much as 870 bps in October 2015, had declined to 131 bps in August 2016. The SBI report says, for September it expects the difference to be at 44 bps. "In the next few months this difference will narrow down further as CPI is going to decline and WPI is going to increase. The convergence of CPI and WPI is eminently good news given the fact that India recently adopted an inflation targeting framework and it is important that both inflation indicators move in tandem."
 
 
According to SBI Ecowrap, what is most important though is the uncertainty surrounding the CPI forecast. It said, "Now that the Monetary Policy Committee (MPC) will decide on rates, it will be interesting to see what forecasting technique the MPC members adhere to. In the Indian context, standard univariate Autoregressive Integrated Moving Average models (ARIMA) time series forecasting or even macro modelling may not work. For example, generating forecasts under (and often unstated) assumptions about exogenous variables such as oil prices, government spending, and global growth will throw up illusory or elusive forecasts or even both! Under such circumstances, it may be better for the MPC to work with short term forecasts for next three to six months as macro variables like oil prices are almost difficult to predict. Remember the oil price crash in FY2015 that had resulted in inflation undershooting RBI projection by more than 300 basis points in December 14."
 
Meanwhile, capital expenditure (Capex) by the private corporate sector was 24.7% lower than the revised estimate for FY2015. Capex by the private corporate sector was estimated at Rs1.51 lakh crore in 2015-16. The RBI has further stated that in order to maintain even this lower level of aggregate Capex in 2016-17, an amount of Rs83,800 crore will have to be spent from the new projects that will be sanctioned financial assistance in 2016-17.
 
 
"We believe project investment is crawling back at a slow pace in the current fiscal. Efforts made by Government in improving ease of doing business are likely to provide succour and push demand cycle in future," the report concluded.

 

User

COMMENTS

Govinda Warrier

2 months ago

Let us hope MPC and RBI will keep their eyes and ears open and keep in view all the concerns and anxieties expressed and suggestions offered by experts. RBI too has its own think tank. Hi

tvkamath48

2 months ago

Good information on inflation.

TRAI’s draft tariff order beneficial only after complete digitisation in broadcasting: Report
The Telecom Regulatory Authority of India (TRAI) has issued a draft order for content pricing and negotiations in broadcasting sector. This includes a proposal to allow households to pay Rs130 as monthly rental per set top box for 100 standard definition channels that are being offered to them on TV. While this move would help customers, full digitisation in the broadcasting sector holds the key to benefits to all players, says a research note. 
 
In the report, ICICI Securities Ltd says, "The distribution network model recommended by TRAI is clearly the ideal model and will pass on power to the hands of consumer. It is a departure from the current regime where bouquets determined by broadcasters are sold to DPOs at heavily discounted rates making the proposition of a-la-carte selection impossible or uneconomical for the consumer. Broadcasters were able to push complete bouquets as contracts were largely at fixed-fee basis. However, the lack of transition to subscriber also owed to lack of audited subscriber numbers even in phases-1 & 2 markets. We believe integrated distribution network model can be implemented only when there is digitisation in its true form and complete transparency in subscriber numbers of distribution platform operators (DPOs). With phase-3 digitisation mandate stuck in the courts, we believe phase-4 might get meaningfully delayed by two to three years, hence also the application of the new tariff order."
 
"The order (from TRAI) goes a long way in democratising content viewing by placing strength in the hands of consumers for package and channel selection. However, for the distribution network model to succeed, TRAI has assumed that phase-4 digitisation will be complete by December 2016 and the tariff order will be applicable from April 2017. We believe digitisation as of now is far from reality and actual digitisation might be at least two to three years away in terms of deployment, putting a question mark on the applicability of the new tariff order."
 
"In addition," the report says, "the order has not made any reference to carriage fee and continuation of an unregulated carriage regime can annul the implications of the order. We believe that the order will finally lead to higher average revenues per user (ARPUs) as consumers select content based on their ability to pay and should benefit broadcasters too in the long run. We however anticipate much resistance from broadcasters for the application of this tariff order without digitisation in phases-3 & 4 markets".
 
What, according to ICICI Securities, is surprising in this draft tariff order (issued by TRAI) is there is no mention of regulating carriage fee and ensuring that there is no discriminatory carriage fee payment. "Not regulating carriage fee will annul the implications of the order as broadcasters can incentivise bouquet selection by DPOs by providing attractive carriage fee. The consultation paper on the tariff order (issued on 29 January 2016) had extensively discussed carriage fee and the need to regulate it," the report added.
 
With TRAI's draft tariff order broadcasters would lose power while distributors stand to gain, the report says, adding, "With this order, we expect broadcasters’ ability to push bouquets to be challenged and big networks will fail to yield the power of negotiation and push through niche channels. Distributors stand to gain with the power of packaging and now are no longer worried of the high reference interconnect order (RIO) rates of channels as broadcasters can provide maximum incentive of 15%. Direct-to-Home (DTH) stand to benefit as compared to National MSOs as content costs normalise; however, regionally strong multi system operators (MSOs) will be able at gain from cheaper content."
 
According to its new draft tariff order, broadcasters should also declare the maximum retail price (MRP) on channels being offered on an a la carte basis for their subscribers. TRAI has also proposed a genre-wise ceiling on channel prices.
 
With this new model, DPOs will be able to charge rental amount of Rs130 for carrying 100 channels and will get Rs20 more for each block of 25 channels. Post April 2017, the DPOs will continue to collect, account and consolidate the amount from customers as it is being done currently, for which they would get 20% commission on content.
 
The order has introduced an MRP model of pricing where broadcasters are given the freedom to price their MRP based on the genre of the channels. All channels are classified into seven genres and pricing caps are recommended for each (see table below). Broadcasters are allowed to form bouquets but the price of bouquet cannot be less than 85% of the channel’s ala carte price sum. 
 
 
"Broadcasters in the current regime are able to give very attractive bouquets priced at 10-20% of RIO rates making it impossible for DPOs to opt for ala-carte channels. Broadcasters under the new regime will find it very difficult to convince DPOs to carry mid-tier channels (e.g. Life OK, &TV) in base packs. In order to maintain reach, broadcasters might also be forced to convert many channels to become Free to Air (FTA)," the report says.
 
With the new draft tariff order consumers would get a lot of choices, which eventually lead to higher ARPUs. Consumers will now have complete information on channels pricing and clear segregation of pay and free-to-air (FTA) channels. This will ensure that consumers will be able to pay for what they watch. Consumers will now be able to dynamically select channels.
 
At present, Indian consumers are spoilt for content choices, as even in the base pack it is very high. This is because broadcasters have been competing to get maximum reach for their channels and pushing their content to base packs across DPOs. "While many channels in the new regime will convert to FTA, consumers will now also have to limit what they want to subscribe. Eventually, we believe consumers based on their content requirements and ability to spend will end up spending more on content," the report from ICICI Securities says.
 
Talking about pay TVs, ICICI Securities feel that content stickiness would drive their revenues. It says, "Leadership channels with top-three positions will only be able to garner places in customer packages. Mid-tier channels in each genre will not be able to survive in a-al-carte regime and will be forced to become free to air. We expect reach of channels placed on a-la-carte to be severely impacted. Genre leaders in GEC, regional, sports and movies will be able to maintain their position."

 

User

We are listening!

Solve the equation and enter in the Captcha field.
  Loading...
Close

To continue


Please
Sign Up or Sign In
with

Email
Close

To continue


Please
Sign Up or Sign In
with

Email

BUY NOW

The Scam
24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
Moneylife Magazine
Fiercely independent and pro-consumer information on personal finance
Stockletters in 3 Flavours
Outstanding research that beats mutual funds year after year
MAS: Complete Online Financial Advisory
(Includes Moneylife Magazine and Lion Stockletter)