HSBC, however, cautioned that going ahead a slight moderation in output is likely as new order growth decelerated slightly, led by export orders amid the sagging global economic situation
New Delhi: India’s manufacturing sector inched up in June 2012, as the country saw improvement in business conditions as well as hiring, an HSBC survey said.
The HSBC India Manufacturing Purchasing Managers’ Index (PMI)—a measure of factory production—improved slightly to 55 in June 2012, from 54.8 in May 2012.
A reading above 50 shows that the sector is growing. Below 50, it indicates that the segment is contracting.
“Activity in the manufacturing sector kept up the pace in June with output and employment expanding at a faster pace,” HSBC chief economist for India & ASEAN, Leif Eskesen said.
In order to accommodate higher levels of output, manufacturers hired more workers in June, this year.
HSBC, however, cautioned that going ahead a slight moderation in output is likely as new order growth decelerated slightly, led by export orders amid the sagging global economic situation.
June PMI data also signals continued inflationary pressures in India’s manufacturing sector as input and output prices rose at a faster pace than in May, keeping inflation high by historical standards.
Output prices increased as manufacturers attempted to pass the rise in the cost of inputs on to their clients.
Moreover, charges also increased in line with more expensive labour costs, HSBC pointed out.
“In light of these numbers, the Reserve Bank of India (RBI) does not have a strong case for further rate cuts, which could add to lingering inflation risks,” Mr Eskesen said.
In its mid-quarter monetary policy review on 18 June 2012, RBI chose to leave key interest rates on hold.
Meanwhile, the Indian economy is grappling with slow growth and high inflation rates.
India’s economic growth rate slowed to a 9-year low in March quarter at 5.3%, and 6.5% for the entire 2011-12 fiscal. The 2011-12 growth was lower than 6.7% seen in 2008-09 amid the height of global financial crisis.
India’s wholesale inflation was 7.55% in May 2012. At the retail level, the Consumer Price Index (CPI) inflation for May was 10.36%.
Godrej Properties and investors will bring in equity at a ratio of 29:71 and share the profits in the same ratio, the company said in a release
Godrej Properties (GPL), a major real estate player, has roped in global investors to launch a fund to develop residential properties in India. Dutch pension services provider APG and Sparinvest Property Fund II have invested in the fund to develop three to five residential properties in Mumbai, NCR, Bangalore, Pune and Chennai.
GPL and investors will bring in equity at a ratio of 29:71 and share the profits in the same ratio, the company said in a release.
“The platform will enable GPL to capture outright land purchase transactions in currently dislocated market conditions without deviating from its asset light model and is expected to generate substantial earnings over the next seven years, which will contribute significantly to the company’s growth,” GPL said in a release.
Commenting on the development, Pirojsha Godrej, managing director and chief executive, Godrej Properties said, “We are excited about this association with a global investor group led by APG, which will enable GPL to source deals with large capital requirements in our focus markets of Mumbai, NCR and Bangalore. This is an important growth opportunity for GPL which will allow us to extend the number of projects in our portfolio while maintaining our capital efficient land sourcing strategy.”
The move follows change in the Indonesian coal pricing policy, which links the price with that in the international market, making coal costlier for Indian power producers
New Delhi: Reliance Power (RPower) said it has filed for arbitration against 11 procurers of electricity produced from its 4,000 MW ultra mega power project (UMPP) at Krishnapatnam in Andhra Pradesh, reports PTI.
“Reliance Power has filed its statement of claim in the Indian Council of Arbitration under the Indian Arbitration and Conciliation Act 1996 against the 11 procurers of its Krishnapatnam Ultra Mega Power Project (UMPP),” the company said in a statement.
The power procurers include four distribution utilities in Andhra Pradesh, five in Karnataka and one each in Maharashtra and Tamil Nadu.
The 4,000 MW UMPP is facing issues relating to change in regulations in Indonesia. The Indonesian government, in September 2011, linked the price of its coal with that of the international market, thereby making the dry fuel expensive.
This regulation hit Indian power generation companies which were importing the fuel from the island nation for the projects back home.
The companies that have been impacted had appealed to the government to permit them to increase power tariffs from the affected plants. The government has asked the producers and the procurers to resolve the matter bilaterally.
“CAPL (an RPower subsidiary) has said that the change in regulations in Indonesia, which is beyond its control, has impacted all imported coal fired projects in India with nearly 15,000 MW capacity involving an investment of nearly Rs75,000 crore,” the statement added.
The company said it has sent a dispute resolution notice for an amicable solution to procurers earlier in March 2012, but did not receive any response from them.
The Statement of Claim has cited relevant clauses under the Power Purchase Agreement (PPA) signed between Coastal Andhra Power (CAPL), the wholly-owned subsidiary of RPower and procurers comprising 11 state distribution companies in four states.
The Power Purchase Agreement provides for resolution of disputes by Arbitration under the Indian Arbitration and Conciliation Act, 1996.
Earlier, on a petition filed by CAPL, the Delhi High Court had passed an order directing that no coercive steps shall be taken against CAPL by the procurers of Krishnapatnam UMPP. The matter is before the Delhi High Court.