Core Growth Up 5.3% in February

Core sector output grew 5.3% year on year in February on the back of steep rise in cement and fertilisers production, but could not match the previous month’s growth rate of 6.1%.

Official data showed a 22.9% rise in cement output and 5.3% increase in fertiliser production in February compared with a 19.6% rise and 1.6% decline, respectively, in January.

The eight infrastructure sectors of coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity that make up the core sector index constitute 40.27% of the Index of industrial Production used to measure industrial growth.

Experts expect the industrial growth for February to be down marginally from January, but remain high following strong core sector performance in the month.

ICRA expects IIP growth at 6.5- 7.0% in February even as it sees sequential moderation in the pace of expansion. Industrial production was up 7.5% in January.

Coal and steel production grew 1.4% and 5% respectively during February against 6.6% and 8.7% growth respectively in the same month last year.

Petroleum refinery production surged 7.8% in February against a 2.8% fall in the year-ago month. Electricity generation grew 4% in February against 1.2% expansion in February 2017.

While rising fuel prices may dampen refinery product demand and consumption a bit, strong vehicle sales are expected to drive consumption growth, said Devendra Kumar Pant, chief economist at India Ratings and Research, a Fitch group company. Electricity growth is also likely to improve in coming months due to stable IIP growth and summer month demand, he said.

Motown in High Spirits

India’s automobile industry just had its best fiscal year with data from manufacturers showing all-time high sales across segments. Analysts expect the momentum to continue in the new financial year, as economic activity is improving as well.

Cumulative domestic vehicle sales growth in the past year was 13-15%, according to estimates based on data shared by industry players, hitting the double-digit mark for the first time since fiscal 2012. The two-wheeler, three-wheeler and commercial vehicle segments have each posted record double-digit growth, despite uncertainty over the implementation of GST and transition to new emission standards. In passenger vehicles, the industry is projecting a high-single-digit expansion for fiscal 2018.

The local two-wheeler market is estimated to have crossed the 20-million-unit milestone, with sales growing 14%, helped by strong demand in the rural areas after good rains last monsoon. The three-wheeler output (domestic and exports combined) likely ended the year close to the 1-million mark, with growth of more than 25%.

The commercial vehicle segment, seen as a barometer of economic activity, is estimated to have recorded sales of over 8.8 lakh units in the past fiscal year, growing 23% from the year before, with medium and heavy vehicles eclipsing the previous peak posted in FY12. Industry executives cited the introduction of GST, which resulted in free movement of goods, and other policy changes for the strong performance. The passenger vehicle segment is expected to have expanded 8% with sales of about 3.3 million units.

India has been an outperformer among leading global automobile markets in calendar year 2017.

According to data from OICA, a global dealer body, with sales of 32,27,701 units, India remained the fifth largest market for passenger vehicle sales globally, trailing China, the US, Japan and Germany. Industry observers expect the country to overtake Japan by 2020.

India had overtaken China as the largest motorcycle market in 2016.

In calendar year 2017, demand for passenger vehicles grew the strongest in India (by 8.8%) after Iran (20.6%) and Brazil (10%). In commercial vehicle sales, India at 12.4% grew the fastest after China’s 13.9% expansion.

India is the fifth largest market also for commercial vehicles, after the US, China, Canada and Japan.

Stone-pelters in Kashmir target tourists

A day after 20 people, including four civilians, were killed in anti-terror operations in south Kashmir, many panic-stricken tourists fled Srinagar, even as the Valley observed a complete shutdown called by separatists.

Most of the tourists reached the airport early in the morning to escape attacks by stone-pelters who had targeted tourists in three places on Sunday. Late Sunday night, two buses carrying visitors from Indonesia were pelted with stones near Dal Lake. Prompt action by houseboat owners saved them. Two women tourists from Abu Dhabi had to be hospitalised after suffering head injuries in stone-pelting on their cab.

In another incident, a 100-strong mob stoned a tourist bus at Awantipora in Pulwama district, injuring two women from UP. The attack took place on the Jammu-Srinagar national highway around 9pm when the bus which was taking tourists on a city tour. Two women were taken to Sri Maharaja Hari Singh Hospital in Srinagar and given first-aid.

In a setback to the J-K tourism sector ahead of the peak season, several hotels, including five-stars, received a large number of cancellation calls from travel agents in Delhi, Mumbai and other cities on Monday.

Oil on the Boil

Diesel has hit an all-time high and petrol is hovering around four-year peak in the country following a rapid rise in international rates led by strong global demand and oil producers’ resolve to keep crude supply restricted for extended period.

Higher prices are considered negative for heavy oil importers like India. Higher fuel prices trigger broader inflation, shrink room for rate cuts by the central bank, increase demand for foreign exchange, and leave the exchequer with lesser resources for development work as demand for subsidy and tax cuts rises.

A sharp recovery in crude oil prices, which is up 47% since July 1 last year, is estimated to have expanded India’s oil import bill to $88 billion in 2017-18 from $70 billion in the previous year. India imports nearly 82% of its oil requirement.

On Sunday, diesel was sold for record prices in all four metro cities of Delhi, Kolkata, Mumbai and Chennai. At Indian Oil outlets, diesel was priced at ₹64.58 a litre in Delhi and ₹68.77 a litre in Mumbai.

Petrol prices were highest since September 2013 in Delhi on Sunday. In Mumbai and Chennai, prices were highest since July 2014, and in Kolkata since August 2014. Petrol was sold for ₹73.73 a litre in Delhi, and ₹81.59 in Mumbai at Indian Oil pumps. 

Mula-Mutha to be part of National Waterways plan

Pune city has been selected as one of the beneficiaries of the National Waterways project. The Mula-Mutha will be added to the list of rivers that are going to be part of this project. The amendment to the Union government’s proposal regarding it is expected in July.

Efforts to develop water transport system in the city will gather momentum with this nomination, said Anil Shirole, a member of Parliament.

Back in August 2017, Nitin Gadkari, the Union minister for road transport, highways and shipping, had urged the local leaders to apply for the nomination while chairing a public function in the city.

“The proposal was to be forwarded via the state government. We had written a letter to the state government urging it to do the needful. The proposal was then sent to the Union ministry. The process to include Pune in the list has already started,” Shirole told reporters.

He said the nomination will help in providing a better alternative to city’s transport system. Other key projects such as the river rejuvenation and the riverfront development projects will work in sync with the National Waterways project.

As per the requirement for this project, draft of 3-metre depth and 35-metre width, which can be used throughout the year, would be developed. Nearly 30 to 35 dry ports can be built alongside the Mula-Mutha rivers.

The National Waterways Bill was introduced in Parliament in 2015 and was approved in 2016.

The National Waterways Bill states that while inland waterways are recognised as a fuel-efficient, cost-effective and environment-friendly mode of transport, they have received lesser investment when compared to roads/ highways and railways. “Since inland waterways are lagging behind other modes of transport, the Central government has evolved a policy for the integrated development of inland waterway,” the bill said.

Dalai Lama thanks India

On a day that marked the beginning of the 60th year of him first setting foot on Indian soil, spiritual leader Dalai Lama said that the Tibetans were not seeking separation from China, but were only seeking “certain rights” mentioned in the Chinese constitution, including Tibetan autonomy “to preserve their own culture”.

The ‘Thank You India’ event in Dharamshala is part of the year-long celebrations planned to mark the milestone 60 years and was originally scheduled in a Delhi stadium, but later moved to Tsuglagkhang temple in McLeodganj in Dharamshala — the seat of Tibetan government — to avoid any fresh confrontation with China. There are high profile visits being planned in April, with National Security Adviser Ajit Doval and External Affairs Minister Sushma Swaraj due to visit Beijing, to be followed by Defence minister Nirmala Sitharaman and ultimately Prime Minister Narendra Modi in June.

The event on Saturday was attended by Minister of State for Culture Mahesh Sharma and the BJP National General Secretary Ram Madhav.

The Dalai Lama thanked India for giving him shelter and said the Tibetans have turned their unfortunate circumstances into a path of enlightenment by reviving their spirit and influence. Ram Madhav, expressed hope that the Dalai Lama “would be able to find a solution to the Tibetan issue through peaceful and democratic means.”

As to what he thought about India’s equation with China, the Dalai Lama said, “Logically, India and China are most populated nations. Any sensible person would want Hindi-Chini Bhai Bhai at practical level to live together. Both India and China cannot destroy each other.”

Maharashtra keeps Ready Reckoner rates unchanged

The Maharashtra state government has decided to keep the Ready Reckoner rates unchanged this year due to the slump in the real estate sector. Anil Kawade, the Inspector General of Registration, said that the Ready Reckoner rates for this financial year will remain the same as that of 2017-18. Earlier, there was a buzz that the rates might be brought down after the real estate industry suffered a number of blows due to several factors, the primary one being demonetisation.

Ready Reckoner rates are the prices of residential units, land or commercial property for a given area that are published and regulated by the state.