Companies & Sectors
Industry to maintain double digit growth, says Montek

Attributing the double digit industrial growth rate to stimulus packages, the Planning Commission on Friday said that the growth momentum would be maintained in the coming months, reports PTI. 

"To get a growth rate well above 10% is not just a base effect. There is an element growth that is taking place, which I hope will be sustained," Planning Commission deputy chairman Montek Singh Ahluwalia told reporters.
According to data released earlier in the day, industrial production grew by a robust 10.3% in October against a paltry 0.1% in the same month a year ago, powered by manufacturing, particularly consumer durables.
Pointing out that the government’s efforts were yielding results, Mr Ahluwalia said, "We have been saying consistently that the stimulus is taking effect and the recovery process is therefore gaining ground. Our forecast about improvement in economic growth is accurate and we would be able to maintain this momentum in coming months."
The Planning Commission has projected a growth rate of 6.5% for the current financial year. The Commission, however, may revise its growth projections in view of the high growth rate of 7.9% recorded during the second quarter of 2009-10.
The strong industrial production data came days after a better-than-expected economic growth of 7.9% in the second quarter of this fiscal, reflecting that the economy would sustain the recovery provided that agriculture does not slip too much.
For the first seven months of this fiscal, industry expanded by 7.1% against 4.3% a year ago.
Manufacturing, which has almost 80% weight in the Index of Industrial Production, grew by 11.1% against (-)0.6% a year ago, when the industry faced the full impact of the global financial crisis after the collapse of US financial services icon Lehman Brothers.
Within manufacturing, consumer durables production expanded by 21% in October against (-)1.6% a year ago. Mining production grew by 8.2% in the month against 3.2% and electricity generation expanded by 4.7% compared to 4.4%.
Industrial growth for September was revised to 9.6% from the provisional estimate of 9.1%.


Osian Art Fund: Art of a scam?

A fool and his money are soon parted, the saying goes. Obviously, pathetic returns come in when an ’art’ fund is managed by an Investment Banker type. And valuation is so iffy that the winding-down realisation is at huge odds with the so-called ‘declared’ asset value.

What is interesting is that there is no regulatory oversight for any aspect of this kind of business. Brokers and investment bankers have milked this lacuna by selling such funds to people only because they get commissions which could be in the range of 6%-10% of the amount mobilised. And, of course, these ‘selling expenses’ are charged to the fund.

The interesting thing is that the products were actually sold to smaller guys also in lots of as low as Rs1 lakh.  In their greed to grab the commission, the intermediaries left no one alone, big or small.  Intermediaries approved by Securities and exchange Board of India (SEBI) selling non-regulated products should be probed and preferably banned. As it is, today many brokers are selling so many ’structured’ products, including ‘guaranteed’ products which can cause serious damage to any investor. SEBI has to wake up and impose a blanket ban on anyone selling any financial product that is not approved. Maybe the RBI could also step in. It is these kind of art funds, plantation schemes, time-share schemes, etc that cause financial bloodshed.

The main reason is that these products can be sold by anyone to anyone. Or take another interesting example. I saw an ad of a jewellery company called ’KFJ’ which offers a scheme whereby you contribute a fixed amount each month, for 30 months. At the end of 30 months, KFJ guarantees you gold for your money ‘at the lowest price which existed during the 30 months’.  The arithmetic is not workable. Either KFJ is very certain that gold prices are going to keep crashing (in which case, the 30th month price would be the lowest and it can use the money for the period of 30 months)  or it uses the money to speculate in other assets which offer returns that  can make good the difference.  I have a feeling that this is going to turn into a mega scam. If this is not deposit-taking or a collective investment scheme, I wonder what is. The Reserve Bank of India (RBI) is, of course, the ‘Big Sleeper’; one has to ‘bring to attention’ any wrongdoing and then RBI asks for its morning cup of coffee before getting to work.

Clearly, KFJ’s scheme is a Ponzi scheme in the making. It does not need any regulatory approvals, so KFJ can merrily trap the greed for gold in its main catchment areas in south India, where the craze for gold is legendary. Housewives will be eager victims.

Our regulators will not wake up. Teak plantation schemes, time-share schemes, chit funds, fixed deposits, land scams et al will thrive and smart conmen will vanish with the money. The investors have no protection at all from financial rogues who come disguised as brokers and insurance salesmen. I also feel that the investors who lose their money deserve it, simply because they are so greedy and gullible.  

(Read Moneylife news breaks on Osian at



Sharat Jain

3 years ago

We have also not received the redemption proceeds from Osian's Art Fund. We have written on many forums, but till date no action has been taken against this scheme. It is very hard to digest that this type of schemens are first floated under the nose of our Govt., and then when the company is unable to pay back (for the reasons best known to them), they try to delay the matter for years & years on one pretext or the other. Sharat Jain. New Delhi.

Venkat Iyer

5 years ago

I am a regular reader of articles published in your magazine.
To be frank, I have never been a 'great' sympathizer of small investors who are swayed all their lives with 'greed'.
You were right that these people 'deserve' it and much more.
When someone said- 'Talk economics and people get bored.
Talk about money and their eyes lit up'.
And looking at the number of scams in our country I have a suggestion to our politicians who have a penchant to rename our cities and states. What could be much easier than that?
It is time we changed the name of our country from India to "Scamdia".


7 years ago

KFJ, for any other reasons going down the tube is another thing, is not running an unviable ponzi scheme which is a pyramiding scheme.

By guaranteeing gold at the lowest price that existed in the future 30 months it is SELLING to the investor to a Lookback CALL option and also OBTAINING from the investor a Forward Start Call option with the Forward start date at 30 months. Net cost of these two options is less than the interest free monies it is receiving for 30 months in equal instalments. It is possible to honestly honour this commitment, financially and mathematically. Someone ends up cheating will be a factor of other things.

OECD expects international M&A deals to fall by 56% in 2009

The Organization for Economic Cooperation and Development (OECD) said it expects international mergers and acquisitions (M&As) to fall by 56% this year compared with 2008, the largest year-on-year decline since 1995, reports PTI.

The estimate is based on OECD's analysis of data for international M&A activity up to 26 November 2009, OECD said in a report.

The fall was largely due to the 60% decline in the value of cross-border M&As by companies based in the OECD area, to $454 billion in 2009 from over $1 trillion in 2008, it said.

However, this phenomenon was also due to the first sharp declines in M&A activity in major emerging economies—international M&A activity by companies based in Brazil, China, India, Indonesia, Russia, and South Africa fell by 62% to $46 billion in 2009 from $121 billion in 2008.

M&A activity in these countries is forecast to fall by almost 40% this year to just over $80 billion from just under $140 billion in 2008, the organisation said.

Speaking at the recent opening of the OECD Global Forum on Investment in Paris, OECD secretary general Angel Gurria said that governments needed to “do more” to promote business investment.

"Against the backdrop of a fragile global economy and sharp declines in international investment activity that have now spread to the emerging economies, the international investment policy community cannot afford to relax," Mr Gurria said.


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