Minister of state for finance Namo Narain Meena said in a reply to Rajya Sabha said the government was keeping a watch on global economic situation to assess the possible spill-over of economic downturn on the Indian economy
New Delhi: Global commodity prices continue to remain high despite weak recovery in advanced countries and this has resulted in continuation of inflationary pressure India, reports PTI.
“Despite the weak recovery in growth in the advanced economies, global commodity prices have not softened as much as one would have expected. As a result, supply side pressure on domestic inflation persists,” minister of state for finance Namo Narain Meena said in a written reply to Rajya Sabha.
He said the government was keeping a watch on global economic situation to assess the possible spill-over of economic downturn on the Indian economy.
The minister added that a moderate inflation is conducive to growth and investment activities.
His reply comes at a time when the government battling price rise. Headline inflation has been above 9% since December 2010 and stood at 9.22% in July this year.
Food inflation breached the double-digit mark, after a brief period of moderation, and stood at 10.05% for the week ended 20th August.
The Reserve Bank of India (RBI) has hiked interest rates 11 times since March 2010 as part of its monetary tightening policy to tame inflation.
“The RBI’s monetary policy stance is aimed at maintaining an interest rate environment that moderates inflation and anchors inflationary expectations,” Mr Meena said, adding that while cost of borrowing goes up with the increase in policy rates, lower levels of inflation would provide greater relief to the common man.
India Inc has complained that high interest rates have led to increase in costs of borrowings, thus hindering fresh investments which have led to a slowdown in industrial activity.
The country’s gross domestic product (GDP) growth during the April-June quarter was 7.7%, the lowest in six quarters.
Mr Meena said the government has taken action to provide succour to affected sectors on account of high interest rates.
“On an ongoing basis, government has also been providing interest subventions for key sectors of economy and sections of the society,” the minister said.
In reply to another question, Mr Meena said banks are not making any big profit due to frequent increases in interest rates on existing loans.
“Taking cues from the monetary tightening by RBI, banks have been increasing both their deposit and lending rates.
While the borrowers pay high interest rates when lending rates go up consequent upon hike of policy rates by RBI, the scheduled commercial banks also raise their deposit rates which have increased in the range of 250-500 basis points since March 2010 across all maturities.”
“Therefore, higher lending rates do not necessarily mean higher profit for banks,” Mr Meena said.
The NGO, Centre for Public Interest Litigation, submitted that Datacom, jointly owned by Videocon and HFCL, was at number nine in the list of applicants for spectrum but it became number one when first-cum-first-served policy was ‘changed’ by the Department of Telecom
New Delhi: An application was on Tuesday moved in the Supreme Court seeking to bring the Videocon group within the ambit of Central Bureau of Investigation (CBI) probe in the second generation (2G) scam alleging that one of its companies was a major beneficiary of spectrum allocation during former telecom minister A Raja’s tenure, reports PTI.
The NGO, Centre for Public Interest Litigation (CPIL), submitted that Datacom, jointly owned by Videocon and HFCL, was at number nine in the list of applicants for spectrum but it became number one when first-cum-first-served policy was ‘changed’ by the Department of Telecom (DoT).
“Datacom, jointly owned by Venugopal Dhoot of Videocon and Mahendra Nahata of HFCL, is one of the major beneficiaries of the 2G spectrum scam. According to its date of application, it was number nine in the list of applicants.
“However, on 10 January 2008, the basis of determining FCFS was changed, which according to CBI’s charge-sheet was done in a criminal conspiracy to help certain companies,” alleged the CPIL, on whose PIL criminal investigation was directed into the 2G scam.
“Datacom became number one in 20 circles after the order of priority was altered. CBI has so far apparently ignored this and other vital aspects, and its decision to leave out Datacom from the charge sheets has weakened the prosecution case,” the NGO said in its application.
Referring to report of the justice Shivraj Patil committee, which was appointed to look into the irregularities in the spectrum allocation, the CPIL submitted that the document revealed that Datacom had moved to the number one position in 20 circles by jumping over Swan Telecom (in 11 circles), Idea, S Tel and Spice. .
The NGO also claimed that either Venugopal or his brother Rajkumar Dhoot, who is an MP, was personally present in the DoT when licences were being issued.
“Under secretary in the DoT had given a first person account of the happenings inside DoT on 10 January 2008 to the justice Patil committee. He had stated that a person flashing a Rajya Sabha MP identity card had entered the premises of the DoT.
“Venugopal Dhoot’s brother Rajkumar Dhoot, who is also associated with Videocon, is a Rajya Sabha MP. So either he or Venugopal himself could have been present in the DoT using the said identity card.
“During the hearing in the trial court, accused Shahid Balwa through his advocate has stated that Venugopal was present in the DoT on that day when licences were being issued and he had misused the Rajya Sabha MP identity card of his brother,” it alleged.
Seeking its direction to CBI to look into the issue, the NGO submitted that despite all the evidences, the CBI has not charge-sheeted them.
“As per some news reports CBI had questioned both the Dhoot brothers long ago in connection with licences and spectrum allocated to Videocon/Datacom, but still neither they nor Datacom/Videcon have been charge-sheeted, which has severely weakened the prosecution case,” it further claimed.
The NGO also pointed out the alleged irregularities in spectrum allocation during the tenure of former telecom minister Dayanidhi Maran between 23 May 2004 and 15 May 2007 and expressed concern over CBI not registering case against him.
“It is unfortunate that CBI has not even registered an FIR in this case and apparently is seeking to close the case,” the NGO claimed, adding that the grant of licences to Aircel by Mr Maran when he was telecom minister was on a quid pro quo basis.
Mr Maran has, however, refuted all such allegations.
The TRAI report said ‘retrospectively estimating annual value of spectrum in the 1800 MHz band for eight years between 2001 and 2008 is a tricky exercise at the best of times
New Delhi: The Central Bureau of Investigation (CBI) yesterday placed before the Supreme Court the report of the Telecom Regulatory Authority of India (TRAI) which said it was not possible to predict with certainty the precise value of second generation (2G) spectrum that would have emerged in auction between 2001 and 2008, reports PTI.
The report, which was placed before a bench comprising justices GS Singhvi and HL Dattu, said it was a ‘tricky’ exercise to estimate the annual value of spectrum for eight years.
The bench, which was hearing the bail pleas of two of the accused in the 2G spectrum scam, had on Monday said that it would like to go through the TRAI report after senior advocate Ram Jethmalani had submitted that telecom regulator in its report had given a finding that there was no loss in the allocation of spectrum.
The report said ‘retrospectively estimating annual value of spectrum in the 1800 MHz band for eight years between 2001 and 2008 is a tricky exercise at the best of times. Access to data is crucially important, but equally, if not more important is access to business plans and forecasts of service providers who invest in the market.
“We do not have access to the latter information and even the data that we have is inadequate, as documented in our report. We, therefore conduct the exercise of estimating market value of spectrum under severe data constraints and a changing technological environment.”
Asked whether CBI’s case becoming weak due to TRAI’s report that there was no loss to the government due to spectrum allocation in 2008, TRAI chairman JS Sarma said that “the experts have given the range of values but they could not arrive at any definitive figure”.