No controls on FII inflows; RBI may check rupee appreciation: FM

New Delhi: The government today ruled out putting controls on foreign institutional investor (FII) inflows into the equity market as of now, but said that the Reserve Bank of India (RBI) may intervene to check the rupee appreciation if needed, reports PTI.

"At this time, I am not thinking of putting cap on FIIs (inflows in equity market)," finance minister Pranab Mukherjee told reporters at the annual Economic Editors Conference here.

This year, the FII inflows have already reached $24.48 billion. Of this, FIIs pumped in $6.11 billion, about 25% of the total inflow so far, in the month of October alone.

The current levels of capital inflows, which exceed financing requirements of the current account deficit, have put pressure on the rupee, resulting in its appreciation over the last few months.

Mr Mukherjee said the rising rupee has implications for exports.

The RBI is keeping an eye on it and will take action if needed, he added.

"We have faced similar situations in the past and have overcome it without taking recourse to some of the more stringent policy measures that are by now well known to discerning analysts," Mr Mukherjee said.

The upward movement of the rupee against the dollar was sharp in recent weeks as the Indian currency has climbed about 5.6% since the beginning of September due to sustained capital inflows.

Mr Mukherjee said high FII inflows help to finance current account deficit.

"I am confident that with FII inflows and forex reserves, we will be able to contain current account deficit at around 3% of the gross domestic product (GDP) (this fiscal)," he said.

The current account deficit is the gap between the amount the country pays to the external world against what it receives from abroad, barring capital movement. It was around 3.6% of GDP in the first quarter of 2010-11.

Mr Mukherjee attributed this to higher non-petroleum imports which reflected in robust customs duty collection.

In first six months of this fiscal, revenue collections from customs jumped 66.8% to Rs63,229 crore as against the year-ago period.


BSE makes changes in sectoral indices

Mumbai: The Bombay Stock Exchange (BSE), on Monday said that it has reviewed the composition of sectoral indices and the PSU index and excluded and included some scrips, reports PTI.

The exchange has excluded MRF (Auto), AIA Engineering and Jyoti Structures (Capital Goods) and Rolta India (IT), a press release issued here stated.

It has also excluded Mcleod Russel and Ruchi Soya (both FMCG) and Aban Offshore and Essar Oil (Oil & Gas).

Four other companies - DB Corp, Reliance MediaWorks, Sterlite Technologies and Rolta India (TECk) have also been excluded from the sectoral indices.

Among the scrips included are PTC India (BSE Power), United Breweries and Marico (FMCG), BGR Energy and Alstom Projects (Capital Goods) and Fortis Healthcare (Healthcare).

Two companies in oil & gas - Oil India and Petronet LNG and two in PSU - State Bank of Mysore and State Bank of Bikaner and Jaipur, Core Projects and Technologies (IT) and Bhushan Steel (Metal) have also been included, the release said.

Godrej Properties and Mahindra Lifespaces Developers (Realty) have also been included in the sectoral indices, it said.

In technology, five companies - Tulip Telecom, UTV Software Communications, ZEEL, IBN Broadcast 18 and JMD Telefilms Industries - have been included.

The revisions will come into effect from 6 December 2010, the exchange said.


India to grow at 8.25%-8.75% in current fiscal: FM

New Delhi: The economy will grow by 8.25%-8.75% this fiscal and will return to an average growth rate of 9% soon, but food prices continue to drive inflation, reports PTI quoting finance minister Pranab Mukherjee.

Stating that gross tax revenue has grown at a robust pace so far in the current fiscal and proceeds from spectrum sale as also disinvestment would help fill the fiscal deficit, Mr Mukherjee said that economic growth would exceed 9% in the near future.

The auction of third generation (3G) and broadband spectrum and disinvestment proceeds would help meet the fiscal deficit target, Mr Mukherjee said at the annual Economic Editors Conference here.

The gross tax revenue grew by 27.3% so far this fiscal as opposed to negative growth rate in the same period last fiscal, he added.

For the current fiscal, he pegged the economic growth at 8.25%-8.75%.

On inflation, the minister said that food prices were the main driver, while he also expressed concerns on rising rupee having implications on the country's exports.

He said that strong domestic demand and robust investment climate had led to surge in capital inflow.


We are listening!

Solve the equation and enter in the Captcha field.

To continue

Sign Up or Sign In


To continue

Sign Up or Sign In



The Scam
24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
Moneylife Magazine
Fiercely independent and pro-consumer information on personal finance
Stockletters in 3 Flavours
Outstanding research that beats mutual funds year after year
MAS: Complete Online Financial Advisory
(Includes Moneylife Magazine and Lion Stockletter)