Foodgrain output for 2011-12 upped to 252.56 million tonnes

“Rice production has been revised to a record 103.41 million tonne from 102.75 million tonne in the earlier estimate:” said agriculture minister Sharad Pawar

New Delhi: India’s foodgrain production estimate has been revised upwards by over two million tonne to an all-time high of 252.56 million tonne in 2011-12 crop year helped by bumper output of wheat and rice, reports PTI.

In February, foodgrains production was pegged at 250.42 million tonne for the 2011-12 crop year (July-June). The country produced 244.78 million tonne in the previous year.

According to the third advance estimate for 2011-12, released today by agriculture minister Sharad Pawar, rice production has been revised to a record 103.41 million tonne from 102.75 million tonne in the earlier estimate.

Wheat output, too, has been pegged higher at 90.23 million tonne, from 88.31 million tonne in the second advance estimates released in February this year.

However, the production figure of coarse cereals and pulses has been revised downwards to 41.91 million tonne and 17.02 million tonne, respectively, as compared with 42.08 million tonne and 17.28 million tonne, respectively.

“I am extremely happy to see this figure. I would like to congratulate the farming community. Overall stock position is good. The problem will be storage. I hope the concerned department will take appropriate steps,” Mr Pawar told reporters after inaugurating National Crop Forecast Centre, here.

Cotton production is estimated at a record 35.2 million bales (of 170 kg each), as against 34.08 million bales in the earlier projection for this year.

In the 2010-11 crop year, rice production stood at 95.98 million tonne, wheat - 86.87 million tonne, pulses - 18.24 million tonne and coarse cereals - 43.68 million tonne.

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Govt permits 3 airlines to directly import 12.65 lakh kl ATF

The carriers which have recently received permission from the Directorate General of Foreign Trade to import jet fuel are Kingfisher Airlines, SpiceJet and IndiGo

New Delhi: Three Indian carriers, which have been permitted to directly buy jet fuel from foreign sources, would together import almost 13 lakh kilo litres (kl) of the fuel at a cost of about Rs5,780 crore for the present, reports PTI.

The carriers which have recently received permission from the Directorate General of Foreign Trade (DGFT) under the commerce ministry, to import aviation turbine fuel (ATF) are Kingfisher Airlines, SpiceJet and IndiGo.

Air India, which has also applied for such an approval, is yet to receive permission to import ATF. The move will help the airlines to significantly slash its operating costs.

“All the three airlines have been permitted to directly import ATF,” a senior commerce ministry official told PTI.

While InterGlobe, owner of no-frill airline IndiGo, got approval to import 7.15 lakh kl worth Rs3,200 crore of jet fuel, cash-strapped Kingfisher has been allowed to buy 5 lakh kl worth Rs2,233 crore. SpiceJet would import only 50,000 kl worth Rs235 crore, the official said.

The three carriers have been negotiating with leading oil marketing companies and were hopeful of beginning fuel imports in due course, a source said.

Industry experts have claimed that a mix of taxes levied by state-run oil marketing companies and the state governments make jet fuel prices in India among the highest in the world. Currently, fuel costs account for about 40% of an airline's total operating costs. SpiceJet's chief executive Neil Mills had recently said the airline industry would benefit from direct ATF imports due to high ATF prices in India.

“Aircraft fuel expenses were 90% higher than the same period last year and fuel cost as a proportion constituted 50% of the total revenue in October- December, 2011 quarter as compared to 37% in the comparable quarter for the fiscal 2011,” SpiceJet had said in its Q3 financial statement.

The cash-strapped Kingfisher Airlines, which was burdened by a debt of over Rs7,000 crore, had earlier strongly pitched for permission to allow foreign airlines to invest in domestic carriers.

India’s civil aviation sector grew at an average of over 18% in the last seven years and the government has taken various steps to resolve the woes faced by airline industry, including allowing them to directly import jet fuel.

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'Some important' reforms in next 6 months: Basu

“Among the reforms that will happen, I hope, is subsidy reform. The finance minister talked about this in his budget. We will try to use the UID system that we are developing to cut down leakage in subsidy,” chief economic advisor, Kaushik Basu told reporters

Washington: After the furore over his remarks to a think tank here, chief economic advisor, Kaushik Basu, feels India will see “some important” reforms in the next six months, including on subsidies and may be partial diesel decontrol and FDI in retail, reports PTI.

However, he feels the “biggest reform” GST (Goods and Services Tax) may be tougher because it is good and not everybody wants it to happen under the present regime.

Mr Basu, whose remarks on Wednesday that no big ticket reform is possible till 2014 elections raised a political flutter back home, said there is a serious risk of another European crisis in 2014 and appropriate measures need to be taken to avert another global economic crisis.

“Among the reforms that will happen, I hope, is subsidy reform. The finance minister talked about this in his budget. We will try to use the UID (unique identification) system that we are developing to cut down leakage in subsidy,” he said in an interview to PTI.

“In India the leakage is so big that if we can cut this down, it will help cut down our fiscal deficit ... So that's a very important reform, which I think will happen,” he said.

On foreign direct investment (FDI) in multi-brand retail, he said, “you can't be 100% sure, but I feel that it's very likely that it will happen. This can be a big boost to Indian farmers and small producers. It will also have an uplifting on investor confidence.”

The other one, which is more difficult politically, is diesel decontrol, Mr Basu said. “May be what can happen is a partial decontrol. This is not a very well defined term. There are different kinds of partial decontrol that you can have. What we should ideally do is to have a small subsidy that is fixed per litre. This will partially shelter the consumer but will allow the rise and fall of global price to be mirrored in India. This is essential for market efficiency,” Mr Basu said.

The chief economic advisor said his remarks at the Carnegie Endowment for International Peace were clear and addressed towards the possible European crisis and had nothing to do with the 2014 general elections as being reported in the media.

“There is nothing to clarify. I meant everything that I said; the lack of clarity was in its reporting,” he said, adding around this central message, he talked about India.

Mr Basu said in his lecture on Wednesday he had said that India needs to strengthen itself for the possible European crisis of 2014.

“Thanks to the strains of coalition politics there is a slowdown in reforms. Nevertheless, we will see some important reforms within the next six months. This is in our political and economic interest. But the biggest reform, the GST, is going to be much tougher because there you need a constitutional amendment,” he said.

In fact, he said, an interesting reason why GST is so difficult is because all parties realise this is very good.

“Therefore, not everybody wants it to happen under the present regime,” Mr Basu said.

He said 2014 was significant in his talk because of Europe and had nothing to do with the Indian elections. “We in India love politics so much that for us 2014 is nothing but the year of Indian general elections. India has gone through a difficult year with some slowdown in growth,” he noted.

“This has three causes: the European crisis, our difficult battle with inflation and the slowdown in decision-making and reforms and the disruption of Parliament that we have seen in the last year,” he said.

“There is a serious risk of another European crisis in 2014,” the chief economic adviser said.

This, he said, was the central theme of his talk at the Washington-based think tank.

“This is not hand-waving but is based on analysis. In December 2011 and February 2012, the ECB (European Central Bank) pumped in about $1.3 trillion of money into Euro Zone banks. This immediately calmed the markets and I think what ECB did was right,” he said.

“But you have to remember that these are loans that have to be repaid in three years. So if Europe does not manage to reform its fiscal system, then three years from now, when the time comes for this huge amount of money injected into the system to be withdrawn, we could see another European crisis, with shock waves for the entire world,” Mr Basu said.

“I argued we have to take measures against this so that we can avert the global crisis of 2014. That was the gist of my talk,” Mr Basu said.

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