While finance minister Pranab Mukherjee stated that the slowdown in factory output would impact GDP growth in the second quarter, economic affairs secretary R Gopalan expressed confidence that the figures would improve in the second half of the current fiscal
New Delhi: Disappointed with the factory output growth of 4.1% in August, finance minister Pranab Mukherjee today said it may impact India’s second (July-September) quarter gross domestic product (GDP).
“It (IIP) is not encouraging. It is a bit disappointing and it may affect the GDP of second quarter,” he told reporters here.
The factory output, as measured by the Index of Industrial production (IIP), was 4.1% in August, lower than 4.5% in the same month last year.
Mr Mukherjee, however, declined to comment on the extent to which the subdued IIP numbers will impact the economic growth during the July-September quarter (Q2) of this fiscal.
“To what extent it (slowdown in IIP) would affect, it would be premature to make any assessment,” Mr Mukherjee added.
India’s economic growth fell to an 18-month low at 7.7% in the April-June period (Q1). The government expects the country to grow by around 8.5% during 2011-12.
As per the official data released today, the IIP growth during the April-August is 5.6%, as against 8.7% in the corresponding period of 2010-11.
However, July IIP growth has been revised upwards from 3.3% to 3.8%.
“The silver lining is that IIP has improved from July figure... But compared to corresponding period of previous year, it is quite low,” Mr Mukherjee added.
Meanwhile, economic affairs secretary R Gopalan said that the slowdown in the IIP numbers is a matter of concern but expressed confidence that the figures would improve from here.
“It is a cause of concern. But as we go along, if you see the previous year, always second half IIP numbers have been good,” he said.
Former power & finance secretary EAS Sarma cites a series of legal violations and possible environmental damage involved in the Andhra Pradesh project, writes to Union minister Jayanthi Natarajan to reconsider Centre’s go-ahead for the thermal power plant
The East Coast Energy Private Ltd (ECEPL) plant at Kakarapalli village in Srikakulam district of Andhra Pradesh, which recently got the nod from the Ministry of Environment and Forests (MoEF), has garnered much infamy for several legal violations.
Now, former power and finance secretary EAS Sarma has also written to the Union minister to scrap the project altogether.
Mr Sarma has written to the Union environment & forests minister Jayanthi Natarajan, “I understand that MoEF had recently issued a letter to the private company that they could go ahead with the construction of the project subject to certain conditions. Subsequently, it appears that the Ministry had second thoughts on this and kept that communication in abeyance. Considering the public opposition to the project, I am afraid that any precipitate action on the part of your Ministry would only have serious adverse implications.”
Construction of the first phase will generate a capacity of 1,320MW (megawatts) of the 2,640MW thermal power project and the company will spend some Rs7,000 crore on the first phase. Local residents had protested against the construction, and the ensuing violence left two dead in police firing. Despite a Supreme Court judgement that all public utility lands be returned to the respective gram panchayats after removing existing constructions, ECEPL went ahead with the construction and obtained the clearance afterwards. Moreover, the company has allegedly not surrendered 500 acres of land as promised in lieu of the environmental clearance.
“(The) Ministry of Environment & Forests (MoEF) ought not to have accorded environment clearance for ECEPL’s project at Kakarapalli as the site is situated in a unique wetland system that provides sustenance to thousands of traditional fishermen, small salt farmers and others. The wetland at Kakarapalli is also the nesting ground for more than 120 species of migratory birds. Setting up a project in such a wetland invariably causes flooding of thousands of acres of the adjacent agricultural lands,” he said.
India is a signatory to the Ramsar Convention, which aims at protection of wetlands. In a letter to former Union environment & forests minister Jairam Ramesh, Mr Sarma had pointed out that according to the revenue department of the Andhra Pradesh government, the land allotted for the ECEPL thermal power plant is part of a wetland system and the fact has been corroborated by the state forest & fisheries department and the National Wild Life Board. It now remains to be seen if the Centre acts on Mr Sarma’s recommendation.
Canara Bank has announced a retail loan festival till 15th January
Canara Bank has announced a retail loan festival till 15 January 2011 during which interest rates on housing and home improvement loans will be reduced by 50 basis points across all slabs and tenures.
The bank has also completely waived processing charges during this festival period, it said in a statement. It has also waived the 25 basis points additional interest being levied on borrowers acquiring a second residential unit.
In respect of vehicle loans availed during the period, borrowers need to pay reduced rate of interest by 100 basis points, besides being eligible for complete waiver of processing charges, the bank said in a statement.