ICICI Pru MF floats Multiple Yield Fund-Plan D

ICICI Prudential Mutual Fund new issue closes on 2nd September

ICICI Prudential Mutual Fund has launched ICICI Prudential Multiple Yield Fund-Plan D, a close-ended income scheme.

The investment objective of the scheme is to generate returns by investing in a portfolio of fixed income securities/debt instruments. The secondary objective of the scheme is to generate long term capital appreciation by investing a portion of the Scheme's assets in equity and equity related instruments. The tenure of the scheme is 1,100 days.

The new issue closes on 2nd September. The minimum investment amount is Rs5,000.

CRISIL MIP Blended Index is the benchmark index. Chaitanya Pande and Mrinal Singh are the fund managers.

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RBI likely to go for another rate hike in September, say experts

"While the RBI will continue on its anti-inflationary stance, adverse global environment suggests that it might become less aggressive..." global research firm Macquarie economist Tanvee Gupta Jain opined

New Delhi: The Reserve Bank of India (RBI) is likely to continue with its tight monetary policy stance to fight inflation and effect another hike in key interest rates in September, even though the global economic environment is on a downslide, reports PTI.

However, while the RBI is likely to go for another interest rate hike at its next mid-quarterly policy review on 16th September, it will not be very aggressive, the experts said.

According to global research firm Macquarie economist Tanvee Gupta Jain, "While the RBI will continue on its anti-inflationary stance, adverse global environment suggests that it might become less aggressive..."

Global investment banking major Morgan Stanley also thinks, "The RBI will continue with its anti-inflationary stance with one more 25 basis points hike in order to anchor inflation expectations decisively, barring a further deterioration in the growth outlook."

The RBI, at its last review meet in July, raised the repo (borrowing) rate by 50 basis points to 8% and the reverse repo (lending) rate by 50 basis points to 7%.

The apex bank has hiked the key policy rates 11 times since March 2010 to curb inflation, which has been hovering above the 9% mark since December last year.

Headline inflation stood at an eight-month low of 9.22% in July. However, this was much above the RBI's 'comfort zone' of around 5%.

Despite several interest rate increases, the rising discretionary income of the middle class is likely to exert upward pressure on inflation, say experts.

In its Economic Outlook for 2011-12, the Prime Minister's Economic Advisory Committee (PMEAC) had projected inflation to remain high at around 9% till October, before moderating to around 6.5% by March 2012.

Notwithstanding the adverse global economic scenario, better-than-expected June factory output data is likely to prompt the central bank to go for another round of rate hikes.

The Index of Industrial Production (IIP) grew by 8.8% in June 2011, compared to 7.4% in the corresponding period last year.

However, recent negative global developments like the sovereign debt crisis in Europe and increasing concerns that the US economy may slip into recession after its long-term debt rating was lowered a notch to AA+ by Standard & Poor's are expected to eventually affect the Indian economy to some extent, the experts believe.

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Jaya voices objections on GST Bill to PM

Accusing the Centre of trying to 'bulldoze' the Constitution (115th Amendment) Bill, 2011 through Parliament, TN chief minister Jayalalithaa said in a letter to the prime minister that this piece of legislation "encroaches upon the powers vested with the states by the Constitution"

Chennai: Tamil Nadu chief minister Jayalalithaa today voiced her opposition to the proposed Goods and Services Tax (GST) Bill to prime minister Manmohan Singh, asserting it encroached on state powers and was like entering an 'unknown territory' fraught with risk and uncertainty, reports PTI.

She also appealed to non-Congress chief ministers to oppose the 'clandestine and sinister' attempt, as the states would be 'trapped in a bottomless pit'.

Accusing the Centre of trying to 'bulldoze' the Constitution (115th Amendment) Bill, 2011, now before the Parliamentary Standing Committee on Finance, through Parliament, she said in a letter to Mr Singh that this piece of legislation "encroaches upon the powers vested with the states by the Constitution".

Noting that sales tax was the only major buoyant source of revenue on which the states could depend, she said any tax reform measure driven by the Centre should neither reduce the revenue flow from this source, nor should it adversely affect the fiscal autonomy of the states.

"Approval of this Amendment Bill by any of the states will amount to entering into an unknown territory fraught with risk and uncertainty," she said.

Ms Jayalalithaa said before the Centre pushes through the Bill in the Parliament, it is necessary that the consultative process among all states and the Centre is taken forward to come to a broad understanding on the framework of the proposed GST.

Expressing concern over the proposed GST Council and the GST Dispute Settlement Authority, Ms Jayalalithaa said, "This means the states virtually lose their authority to fix tax rates, which is unconstitutional and not acceptable in a federal set-up."

She said implementing GST with two rates initially and converging them to a single rate later is not workable.

"In states like Tamil Nadu, where the tax neutral rate is as high as 17%, this will lead to a huge loss, i.e., more than Rs5,000 crore per annum. Any proposal of GST structure will have to address these concerns," she said.

"The manner in which the government of India is undertaking the implementation of GST amounts to interfering with the fiscal autonomy of the states, thereby having the potential to jeopardise the federal framework of distribution of fiscal powers between the states and the Union," she said.

She asked the prime minister to continue the consultative process to arrive at a broad consensus on the issue.

In separate letters to all non-Congress chief ministers, Ms Jayalalithaa reminded that the sales tax/VAT was the only major source of revenue for the states, while the Centre has many sources of income.

"The government of India is attempting to stealthily encroach upon even this single buoyant source of revenue for the state governments in the name of indirect tax reforms," she said.

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