Citizens' Issues
FDA asks Parle to recall entire stock of 'Mango Bite'

FDA has asked Parle to recall entire stock of Mango Bite candy as it was found to contain buffered lactic acid, a substance that is harmful and unsafe for human consumption

Thane: The Food and Drug Administration (FDA) in Maharashtra has asked Parle Products to recall entire stock of its popular candy 'Mango Bite' from the market as it is "unsafe" for consumption, reports PTI.
Officials of FDA Konkan Division recently raided two locations in Raigadh and Bhiwandi and seized stock of the finished goods and ingredients, valued at Rs2 crore.
According to FDA, the manufacturer Parle Biscuits Pvt Ltd at Kirkhinde in Khopoli (Raigadh) used buffered lactic acid (adulterant) in the confectionery which is not permited.
Joint Commissioner of FDA (Food) SK Shere said the seized goods include sugar boiled confectionery (Parle Kachha Mango Bite) packed in jars valued at Rs1.5 crore. Besides, the team also seized around 8158 kgs of Buffered Lactic Acid valued at Rs10.60 lakh.
The samples of the seized goods have been sent to lab for testing, the officer said.
In addition, the stock of Mango Bite was also seized from the godown at Bhiwandi, FDA officials said.
FDA has directed the company to recall the stock of Mango Bite in the market and a final decision on the matter would be taken only after the test report is received.
Officials said that Lactic Acid was "harmful and unsafe" but cannot be declared as unfit for human consumption. Its use is banned by the Food Authority of India.
Earlier, FDA officials had conducted a raid and seized Mango bite worth Rs60 lakh from a manufacturing unit at Nashik.
The use of lactic acid (chiefly found in milk products) was banned in foodstuff after a bench found it not good for consumption for its tooth decaying side effects. It has been ruled out in Food Safety & Standard Act of 2006.


Market in a no man’s land: Weekly Market Report

A clear direction to emerge in the next few trading sessions

The market snapped its five-week winning streak and closed over 1% down this week on concerns about the slowdown, as highlighted by a slew of economic indicators, and a weak guidance by IT major Infosys on Friday. Headline inflation numbers for September, due on Monday, and earnings reports will drive the market next week.
The Sensex settled 263 points (1.39%) lower at 18,675 and the Nifty declined 71 points (1.23%) to close the week at 5,676. We may continue to see the weakness prevailing on the bourses. However, in case the Nifty manages to close above the previous day’s high in consecutive trading sessions for a few trading days we may see the trend reversing, but the probability of this happening is weak.
The market settled lower on the first trading day of the week on profit booking and weak global cues. The benchmarks closed with modest gains on Tuesday after remaining in the positive for the entire trading session. However, political concerns which emerged in the second half of trade saw the market paring part of its gains. Warning of a downgrade of India’s sovereign rating in the next two years by Standard & Poor’s (S&P) and European concerns led the market lower on Wednesday.
The announcement by the government approving direct transfer of urea subsidy and a positive opening of the European markets helped the domestic indices close in the green on Thursday. The bleak revenue outlook by Infosys played on investor sentiments resulting in the market closing in the negative on Friday.
In the sectoral arena, BSE Fast Moving Consumer Goods and BSE Healthcare (up 2% each) were the top gainers whereas BSE Realty (down4%) and BSE Oil & Gas (down 3%) ended up as the top losers.
The top Sensex gainers in the week were Sun Pharmaceutical Industries (up 5%), ITC (up 3%), Tata Steel, Sterlite Industries and Hindustan Unilever (up 2% each). BHEL (down 7%), Wipro, Hindalco Industries (down 6% each), Infosys (down 5%) and Reliance Industries (down 4%) were the main losers.
In the Nifty space, Sun Pharma, Jaiprakash Associates, UltraTech Cement (up 4% each), ITC and ACC (up 3% each) were the top performers. The losers were led by DLF (down 10%), Siemens (down 8%), BHEL (down 7%), Wipro and Hindalco (down 6% each).    
There is a “one in three” chance of a downgrade of India’s sovereign rating to junk status in the next two years, according to ratings agency Standard & Poor's (S&P). Factors forcing a downgrade would be a drop in growth prospects, deterioration on the external front, worsening of the political climate and slow movement on fiscal reforms.
On the upside, especially given the slew of reform measures carried out by the government in the past three weeks, the outlook can be revised upwards to stable if the government succeeds in reducing fiscal deficit, improve the investment climate and revives growth, the agency added.
India's exports continued to decline for the fifth month, contracting 10.8% to $23.69 billion in September due to slowdown in the western economies. However, imports grew by 5% to $41.77 billion, leaving a trade deficit of $18 billion for the month.
Industrial growth, as measured by the Index of Industrial Production slowed to 2.7% in August due to poor show by the manufacturing sector and contraction in capital goods output. Commenting on the data, Prime Minister’s Economic Advisory Council chairman C Rangarajan said, “IIP numbers indicate there is some turnaround as far as manufacturing sector is concerned. I do expect in coming months the growth rate will further pick up...”
Among corporates, Infosys, India’s second-largest software services exporter, on Friday reported a 24% rise in second quarter profit at Rs2,369 crore but disappointed investors with its conservative revenue guidance. The company lowered its revenue growth guidance for the year ending 31 March 2013 to 17.3% at Rs 39,582 crore, from an earlier projection of 19.7% rise to Rs40,364 crore.
A healthy growth in the core net interest income and an uptick in retail advances pushed up HDFC Bank’s second quarter net profit by over 30% to Rs1,560 crore. The lender’s net interest income grew at a healthy 26.7% to Rs 3,731.7 crore, courtesy a 22.9% growth in advances. However, its other income was almost flat at Rs1,345 crore because of its mutual fund investments, and lower volumes coupled with squeezed margins on foreign exchange revenues.
On the international front, US stocks declined over 2% this week on global growth concerns. Top corporates like General Electric, IBM, Microsoft, Intel, Citigroup, McDonald’s and Coca-Cola are expected to announce their quarterly earnings next week.
In Europe, while the Spanish government is expected to seek a bailout from the European Central Bank’s European Stability Mechanism, the country has opposed the move as the bailout would mean that the nation would have to implement strict fiscal reforms.




5 years ago


As predicted, the Indian government has started its divestment drive. The govt. is behaving like the corrupt and bankrupt zamindar in a Tagore novel, who has to go to the old r a n d i (prostitute) to satisfy his private needs because the younger fresher one is too expensive. As outlined earlier, this is part of its plan. It is talking up the markets, announcing reforms that can never be developed on, and then selling its paper. It will recover Rs 40000 cr. from divestment and Rs. 30000 cr. from spectrum auctions. They say, the money will be applied towards the deficit. In reality it will be used to fund further sops and giveaways in the next budget. The deficit will be kept at 6 % of GDP and they will take their chances with the rating agencies like S and P later. SELL ALL STOCK. ( post below)

India. Reforms. Really?

Much has been made of the “burst of reforms” unleashed by Finance Minister Chidambaram in recent weeks. The stock market has rallied and animal spirits it seems are back. Everybody’s babbling about how the UPA, after eight years in power, has found religion ie “reforms”.

The market is now at 21 times price to earnings (trailing twelve month free float adjusted as per the National Stock Exchange). Once more the mood swings violently. More interestingly the India VIX , the fear index is at 3 year lows of 15. This is usually an indicator of complacency, and historically such lows have signified a massive sell off. The combination of the stretched price to earnings and the VIX means the market is ripe for a big sell off. My two bit as an Ivy educated fund manager in Bombay who has worked internationally on some of the world’s major structural adjustment and economic reform programs.

In reality, the reforms amount to bureaucratic tinkerings with percentages – of a sort that only tax mavens and accountants can comprehend. Witholding taxes go down by a percentage point or two. FII margin percentages change. Service tax percentages for insurance companies change. Now an attempt's been made to increase the percentages foreigners can hold in insurance and pensions. (This last will never pass through Parliament given the unanimous opposition to it). Blah Blah Blah.

The Indian economy, in fact, requires Parashurama’s ax and not the surgeon’s scalpel. The reference is to the mythical woodcutter of Indian mythology who wields a massive axe when needed. Wholesale violence will have to be committed on large areas of India’s economy with Parashurama’s axe, if we are to resume a decent growth rate.

The government had no choice but to unleash this wave of tinkering and call it “reform”. It is trying to keep the capital markets buoyant because it needs to sell or “chipkao” (i.e. stick, as we say in the business) close to Rs 40,000 crores worth of equity. This with spectrum auctions, hopefully plug the budget deficit a little by March. More crucially, it will also free up resources for massive election giveaways in next March’s budget. This is especially needed if the Food Security Bill –Madame Sonia’s chosen strategy for reelection – is to be passed.

Real reforms for India will not happen for a long time. These include financial sector reform, and an end to the financial repression signified by the statutory liquidity ratio. Privatization of the banking system that’s put an end to the ridiculous spectacle of 75 % of the banking system being owned by the government in a market economy. Bankruptcy and exit laws will have to be introduced. Labour market liberalization and the freedom to hire and fire labour will have to be allowed.

The collapsed state of Indian cities will have to be addressed by building 30 to 40 cities to accommodate massive rural urban migration. Land acquisition which is impossible now will have to be addressed. This list does not even include the sector changes required in real estate and infrastructure and sugar, and so on and so on. None of this is happening ever, it seems.

Everybody’s babbling in the media about how crucial the February budget is going to be for the UPA because it will be packed with big ticket sops like the Food Security Bill. Remember game theory however. It is crucial to take your opponent’s reaction into account. The Opposition also knows that the budget will be crucial to the UPA’s reelection chances ! Why then will they allow the UPA to present the budget at all. Especially when they have the numbers and the government is already on life support and in a minority. !!!

The government therefore, will, in all likelihood, fall in November-December, during the winter session of Parliament. Elections will take place in March-April as India needs the school system for a general election. This will allow the Opposition the chance to deny the government’s attempt to pass a budget full of sops and giveaways. The February budget will consequently be a vote on account. This scenario will suit all parties except the Congress and hence it will happen.

Is the market discounting the possibility that in a few weeks, all these guys PC etc. etc. will be gone ? Looking at the way its going up, I think not.

The logical conclusion also is that this is the high point of the markets move this year. India has gone from having the most incompetent FM (Pranab) to the most cunning FM (Chidambaram). The later is deliberately doing all he can to talk up markets to implement his plan. There is little need to oblige him and his plans of using the stock market as a financing vehicle, by buying high and losing one’s hard earned capital.

Deccan Chargers, the winner of second IPL T20, is no more
Now that BCCI is free to go ahead with the termination of Deccan Chargers, the fate of its proposed sale to Kamla Landmarc is uncertain. It is also unclear how players of Deccan Chargers would get their payments
Mumbai: Debt-ridden Deccan Chargers can no longer be a part of the Indian Premier League (IPL) after its beleaguered owners failed to produce a Rs100-crore bank guarantee before the Bombay High Court, a condition that had been set for the struggling team's survival in the League, reports PTI.
Deccan Chargers' failure to furnish the guarantee money before the 5pm deadline on Friday effectively means that the BCCI's termination of the team stands and the Board was now free to float the tender for a new franchise.
Deccan Chronicle Holdings Ltd, the owner of the franchise, had sought an extension to the deadline until 15th October to submit an 'irrevocable and unconditional' bank guarantee but the High Court refused to grant further time.
Justice SJ Kathawala declined to give them more time, saying the earlier deadline of 9th October had been extended by three days to accommodate them.
A top BCCI official said that the IPL Governing Council had earlier decided to terminate Deccan Chargers' contract with IPL and that decision stands.
"We had decided to terminate the contract of Deccan Chargers. It was a decision taken by the IPL Governing Council and only that body can change it. So as things stand, their contract is terminated," the official said.
The court had on 1st October asked DCHL to give the bank guarantee which would be in force for a period of one year.
The BCCI had last month taken the decision to terminate the contract after an emergency IPL Governing Council meeting in Chennai. The DCHL had moved the Bombay High Court challenging the termination.
The court had at an earlier hearing ordered DCHL to bear all expenses for IPL 6 including making payments to BCCI towards franchise, players and support team costs. Besides, it was asked to bear the costs of conducting matches and other expenses. 
In the event of any default on part of DCHL, BCCI shall be entitled to invoke the bank guarantee to the extent necessary, Justice Kathawala had said.
The court had on 26th September appointed retired Supreme Court judge CK Thakkar as arbitrator to resolve within three months the dispute between BCCI and DCHL over the termination of Deccan Chargers franchise.
However, pending arbitration proceedings and making up of an award by the arbitrator, the judge asked the BCCI not to act on the termination of the franchise agreement for a period of seven days, if the award is in their favour.
The judge had, however, clarified that the 26th September order would immediately cease to be in force if DCHL fails to furnish the bank guarantee.
The development comes on a day when the DCHL informed the Bombay Stock Exchange about its decision to sell the IPL franchise to a Mumbai-based real estate firm Kamla Landmarc Real Estate Holdings Ltd for an undisclosed sum.
"Pursuant to its meeting of the board of directors held on 11th October, it was resolved to authorise the board of directors to sell, transfer or dispose of the Deccan Chargers Franchise business undertaking, business division of the company to Kamla Landmarc Real Estate Holdings Pvt Ltd," DCHL said in a filing to the BSE.
Now that the Cricket Board is free to go ahead with the termination of the franchise, the fate of the proposed sale is uncertain. It is also unclear how the players of the Deccan Chargers would get their payments.
Deccan Chargers was hoping to resolve its financial problems by selling the team but it rejected the sole bid it received at the auction in Chennai on 13th September.
PVP Ventures Ltd, the Hyderabad-based urban infrastructure and film production company, had offered Rs900 crores but Deccan rejected it finding the terms of payment and the amount unacceptable.
DCHL purchased the Hyderabad franchise for Rs428 crore in 2008. At the auction, the base price was said to be around Rs50 crore. The winning bidder had to meet BCCI's eligibility criteria and other requirements.


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