World Bank says no plan to trim lending to India

The World Bank envisages lending $14 billion for projects in India between 2009 and 2012

The World Bank will not reduce financial assistance to India for poverty alleviation measures because of the recent official data that showed a decline in the number of poor people in the country.

The international funding agency takes a long-term view on its commitments and the poverty data released on Monday will not have any bearing on that commitment, World Bank country head, Mr N Roberto Zagha, told PTI on the sidelines of an event.

Mr Zagha said, however, that the Bank does use official data put out by Indian agencies while making its plans. “We are constantly analysing (data), and right now I don’t feel there will be any cut because the data has shown a reduction in poverty.”

The Washington-based multilateral lender envisages lending $14 billion for projects in the country between 2009 and 2012, according to the Bank’s country web site.

According to the data by the Planning Commission, the number of people under the poverty line—whose daily consumption is below Rs28.65 for urban centres and Rs22.43 for rural areas—declined to 29.8% in 2009-10, from 37.2% in 2004.
Mr Zagha welcomed the Union Budget 2012-13 that was presented to Parliament last week, calling it “realistic”.

He said, however, that energy, uneducated labour force, increased urbanisation and regulatory issues are the challenges faced by the country at present and demand the added attention of policymakers.

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Steel prices likely to go up by Rs1,000/tn

“Freight (on iron ore) has been increased, excise duty is up, cost has gone up by Rs1,000 per tonne. So, ultimately this will have to be paid by the consumers,” said VR Sharma, deputy MD & CEO (steel business), JSPL

Steel prices are all set to rise by about Rs1,000 per tonne by early next month due to recent increase in excise duty and hike in iron ore freight rates, leading firms indicated.

“The cost push due to increased duty and iron ore freight rates is Rs1,000 per tonne. So, it (price increase) will not be less than that. This will get reflected (in prices) by the end of this month,” Essar Steel (India) CEO & MD, Mr Dilip Oomen told reporters on the sidelines of a conference organised by information portal Steel Guru.

Other leading producers, RINL, JSW Steel and Jindal Steel and Power (JSPL) also echoed similar sentiments.

“Freight (on iron ore) has been increased, excise duty is up, cost has gone up by Rs1,000 per tonne. So, ultimately this will have to be paid by the consumers,” said Mr VR Sharma, deputy MD & CEO (steel business), JSPL.

Rashtriya Ispat Nigam Ltd’s (RINL) chairman, Mr AP Choudhary said that his company has not decided the extent of price hike but it is on the cards.

“We can absorb the impact to a limited extent. In a month, cost has increased very much due to recent policy changes. This will get reflected in next month’s price but we have not yet decided on extent of hike,” he said.

Confirming the move to effect a price hike, a senior official of the JSW Steel said, “It is on the drawing board, a decision will be taken by next week and the hike will be effective early next month.”

In the Budget for 2012-13, announced last Friday, the Finance Minister, Mr Pranab Mukherjee has increased excise duty rate from 10% to 12%.

Besides, the Railways had also increased freight rate on domestic iron ore transportation by 20% on 6 March 2012 to meet its revenue earnings targets, which was hit by the ban on export of the vital steel making raw material in the states like Karnataka and Odisha.

Steel prices, which have been on an uptrend in the last few months, are presently hovering in the range of Rs36,000-Rs37,000 per tonne.

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'NPS likely to manage Rs20,000 crore assets by 2012-end'

Only 13% of the workforce, mainly employees of the government and organised private sector, are covered by a pension scheme.

“AUM (Assets Under Management) of the NPS are likely to move up from Rs14,000 crore now to Rs20,000 crore by the year-end,” NPS Trust managing trustee and chief executive officer N R Rayalu said.

The NPS trust was set up in 2008 by the Pension Fund Regulatory and Development Authority (PFRDA) for taking care of the assets and funds under the NPS in the interest of the subscribers.

NPS is a crucial component of reforms in the Indian pension fund market whose valuation is estimated at Rs13.72 trillion, he said at an Assocham event. He said pension funds can contribute immensely for development of infrastructure as the country plans to spend Rs50 trillion during the 12th Five Year Plan (2012-17).
“Infrastructure projects are starved of long-term funds. Pension funds can be the biggest contributor for development of social and physical infrastructure,” Rayalu said.

He called for spreading financial education to cover unorganised sector under the social security net after retirement. Only 13% of the workforce, mainly employees of the government and organised private sector - are covered by a pension scheme.

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