Trade deficit shoots up 31.5% to $7.5 bn

Merchandise exports from India shrunk one per cent in December, 2008 and stood at $12.7 billion, compared to $12.82 billion in the same month last year. Imports during the month increased by 9 per cent to $20.25 billion from $18.61 billion in the year ago month, data released by Commerce Ministry showed today. With Imports outpacing exports, trade deficit in December stood at $7.5 billion, a rise of 31.5 per cent compared to $5.7 billion in the same month of 2007. This is the third consecutive month in which exports have dipped due to waning demand from overseas buyers in the backdrop of the ongoing global economic crisis, especially in United States and European Union. Oil imports in the month under consideration dipped 31 per cent to $4.71 billion from $6.82 billion in the year ago month. Non oil imports during the month increased 32 per cent to $15.5 billion from $11.78 billion in December, 2007. In the April to December period of 2008, exports from the country increased by 17.1 per cent to $132 billion from $112.7 billion in the corresponding period of 2007. Imports in the April to December period of 2008 stood at $225.8 billion, a rise of 31.5 per cent over $171.7 billion in the same period of 2007.

Trade deficit shoots up 31.5% to $7.5 bn

Merchandise exports from India shrunk one per cent in December, 2008 and stood at $12.7 billion, compared to $12.82 billion in the same month last year. Imports during the month increased by 9 per cent to $20.25 billion from $18.61 billion in the year ago month, data released by Commerce Ministry showed today. With Imports outpacing exports, trade deficit in December stood at $7.5 billion, a rise of 31.5 per cent compared to $5.7 billion in the same month of 2007. This is the third consecutive month in which exports have dipped due to waning demand from overseas buyers in the backdrop of the ongoing global economic crisis, especially in United States and European Union. Oil imports in the month under consideration dipped 31 per cent to $4.71 billion from $6.82 billion in the year ago month. Non oil imports during the month increased 32 per cent to $15.5 billion from $11.78 billion in December, 2007. In the April to December period of 2008, exports from the country increased by 17.1 per cent to $132 billion from $112.7 billion in the corresponding period of 2007. Imports in the April to December period of 2008 stood at $225.8 billion, a rise of 31.5 per cent over $171.7 billion in the same period of 2007.

Century cuts denim cloth production by 50%

Century Textiles & Industries has reduced the production capacity of denim material by 50 per cent of its total capacity due to the adverse market condition. In a statement to the Bombay Stock Exchange, the company has said in view of adverse market scenario and demand recession, the company is restricting the production of denim cloth partly for the time being until further advice by the company, its factory in Khargone, Madhya Pradesh.

DLF to beat realty slump through asset sale

Like its smaller rival Unitech, India’s largest property firm, DLF, says it will sell its assets, as it battles a slump in the real estate sector that has brought down its profit by 69% and sales by 59%. DLF will also stop the sale of its assets to promoter group company, DLF Assets (DAL), in the short term as demand for leased office space shrinks sharply and receivables from DAL rise dramatically. While announcing its December quarter result, the company said that it will ‘focus on unlocking “non-strategic” assets with no medium-term utility’. It didn’t describe what it meant by “non-strategic assets”. The company said it would focus on liquidity and cash flows rather than growth in short and medium term. “Our focus will be on the mid-income homes and commercial complexes, with deferment of high-margin launches in luxury homes and retail space,” DLF vice chairman Rajiv Singh said in a statement. The company said that “due to a sharp reduction in the demand for leased office space,” the balance delivery in DAL will be “substantially delayed” and accordingly the revenues accruing to DLF from the sale of assets to DAL will “not be significant at least for the next several quarters.” DLF is supposed to deliver 19 million sqft of total space to DAL. More than half of this space has already been delivered to DAL. The decision to delay delivery to DAL may also be partly on account of the rising receivables from DAL to DLF for earlier purchases, and DAL’s inability to raise fresh funds. The receivables from DAL at the end of September quarter was Rs 4,800 crore. The company didn’t clarify by how much receivables have gone up in December quarter. DAL hasn’t been able to raise fresh fund in the December quarter to pay back to DLF, but the realty firm said, “DAL has received a serious level of interest from large private equity investors and DAL expects to close this transaction soon, possibly within this financial year itself.” The company booked a total of 1.74 million sqft, including sale and leases in December quarter. This included 0.70 million sqft of space in homes. Compared to this, DLF had sold 3.12 million sqft of space, including 2.79 million sqft of homes and 0.33 million sqft of commercial complexes, in the September quarter. The company said extremely adverse market sentiment affected both topline and bottomline.

Ambani bros should stop fighting: Deora

Petroleum minister Murli Deora on Sunday urged the warring Ambani brothers to stop “fighting”, as it would be good for the country. “I want the (Ambani) brothers to stop fighting. It will be good for the country. I am happy that the court has lifted ban on KG basin gas sales. A lot of fertiliser and power plants in the country are idle or operating below capacity for the want of gas,” said Mr Deora, who was in Mumbai to honour the families of the army and police personnel, who lost their lives in the Mumbai terror attacks. “The KG basin gas will substantially reduce the subsidy burden of the government to the power and fertiliser sectors,” said Mr Deora, an old family friend of the Ambanis. Reliance Industries (RIL) is expected to start producing gas from the hydrocarbon rich Krishna-Godavari basin later this month. The gas production will be scaled up to 40 million metric standard cubic meters per day (mmscmd) by end-2009 and to 80 mmscmd by end-2010, doubling India’s gas production. Around 70% of the KG basin gas is being allocated to the power and fertiliser sectors. It is expected to increase the power generation by 8,000 MW and urea production by 10 million tonne per annum (mtpa). The families of the victims were allotted petroleum product dealerships commonly referred to as petrol pumps in a formal ceremony in Mumbai on Sunday. The scheme has been approved by the government and families shall be provided land for retail stores at any place of their choice within the state. On asking whether someone can avail this facility outside Maharashtra, Mr Deora said, “We are open to that and if someone so desires, we shall get an approval for the same from Central government.” Apart from Mr Deora, petroleum secretary RS Pandey and chief minister Ashok Chavan also were present.

Tata Motors to soon finalise Jaguar, Rover retail plans

Auto company Tata Motors is understood to have begun finalising its India plans for retailing top brands from the Jaguar-Land Rover portfolio, its recent acquisition in the UK. Top company officials said that plans are underway to launch company-owned showrooms, and a large number of Jaguar cars have been imported for initial use in its Taj Mahal Hotels across the country. Among the Jaguar portfolio, Tatas will bring the Jaguar XF, which competes with the Mercedes E-class and BMW 5 series. The Jaguar XF, if brought in as a CBU (completely built unit) will sport a price-tag of around Rs 40 lakh (which includes 114% customs duty) and will have two engine options — 2.7 litre diesel and 3.6 litre petrol. Among the Land Rover models, the Freelander will be an obvious choice. The Freelander retails start from £20,935. When contacted, a Tata Motor official said, the company has not taken any decision for the India launch of JLR brands. The company will be unable to price them competitively as these models are imported and CBUs attract a high duty structure. Incidentally, even as world-wide sales of luxury cars and SUVs are falling, the Jaguar XF is getting a positive response with sales up from 10,000 units in the October-December quarter to 15,000 units. Initially, these models will be brought in as CBUs and plans are also on to bring the models as CKDs (completely knocked down) in a few months. While CBUs attract a customs duty of 114%, CKDs attract a duty of around 15%. One of the first showrooms is expected to be set up in South Mumbai. The group is exploring similar options in other major cities across the world and is expected to start retailing the JLR brands in India by April this year, said an official familiar with the development. “We want to create a world-class experience with these dealerships, he said. Officials have also not ruled out the possibility of the existing Tata Motors’ dealerships stocking JLR models. The company may shortlist one of its existing dealers in every city, who would have to set up separate showrooms for the brands. This year, Tata Motors will also be launching the Nano, Xenon and the new Indigo, and Fiat brands like the Grande Punto Land Rover currently is already being distributed through an independent Mumbai-based dealer Navnit Motors. The dealer is currently retailing Discovery and Range Rover Sport, and is looking to bring in the Freelander at a price tag of around Rs 35-40 lakh. “We will continue to retail the Land Rover models and we yet have to discuss with the Tatas,” Navnit Motors MD Sharad Kachalia said. Currently, the UK auto company is awaiting the British government’s £2.3-billion bailout package.

RCom starts GSM services in Delhi

Anil Ambani-led RCom started its GSM mobile operations in Delhi, offering lifetime validity to subscribers at just Rs 49 compared to Rs 99 by the existing service providers. The company is also offering free talk time worth Rs 450 on any network for three months as a promotional offer and the RCom GSM subscribers can avail this for Rs five every day for the first 90 days. "In a short span of 11 months, Reliance Mobile has created a GSM network in Delhi whose coverage and capabilities are superior to GSM networks that have been in existence for 15 years," RCom Regional Head (Delhi, Haryana and Rajasthan circles) C S Rana said in a statement. Reliance Mobile GSM offering is a unique value proposition fine tuned as per the needs of every segment of GSM customers in the country, Rana said. The subscribers would get double talk time in every recharge till March this year, the company said adding there would be free night calling to any Reliance phone (CDMA or GSM) between 11 in the night till 6 in the morning by paying a monthly charge of Rs 15.