Mumbai: The food security bill will be sent to the parliament after the cabinet finally signed off a bill to expand food subsidies to two-thirds of the country’s population, reports the Times of India. This move may shore up support for the government, but it carries the risk for the slowing economy because the subsidy bill is expected to rise by Rs 27,633 crore.
On Friday, the US indices ended with a whimper, clouded by fear that Europe may not be able to rein in the debt crisis, reports the Wall Street Journal. Fitch placed its ratings on six euro-zone nations, including Spain and Italy, on watch for downgrade. Moreover, Moody’s downgraded Belgium’s credit rating by two notches citing concerns of growth and funding. The Dow Jones Industrial Average edged down 2 points to 11,866, the Nasdaq and Dow Jones ended flat at 2,555 and 1,220 each.
European cues continued to dominate Asian indices on Monday morning. Investors have turned cautious after the rating agencies cast a doubt on the European Union’s ability to come up with decisive response, reports MarketWatch. Japan’s Nikkei Stock Average lost 0.8%, South Korea’s Kospi Composite declined 2.4%, China’s Shanghai Composite and Hang Seng indices were off 1.5% each.
To address the concerns of the market, Euro-zone finance ministers will discuss the draft text of the new fiscal pact in a teleconference on Monday, reports Reuters.
Kingfisher Airlines may find some relief after Sahara Group which co-owns the Formula One motor racing team agreed to give a loan of more than Rs 250 crore to the cash-strapped airline, reports Times of India. The third largest airline is finding it hard to raise funds to repay its debt and continue its operations. The company has a debt of Rs 6,500 crore and the creditors have asked the company to raise around $160 million in equity.
Banks have agreed to remove repayment penalty on floating home loan rate and the fine over minimum balance in savings account. Banks have eased norms to cheer millions of small borrowers after RBI paused the tightening cycle on Friday. Banks generally charge 2-4% penalty of the loan amount outstanding as a prepayment charge on home loan customers.
Britannia Industries has merged its biscuit and dairy sales team to tap new towns and also improve the bargaining power with retailers, reports Economic Times. Analysts said that the company may be trying to cut costs in order to withstand margin pressures. Britannia posted a net profit margin of 2.9% in the second quarter because of high input prices.
Adani Group was selected as the preferred bidder to build a new coal export terminal in Australia. The government of Queensland has allotted 190 hectares (ha) of land to Adani Mining worth $5-6 billion (Rs. 26,400-31,680 crore). The construction will commence by mid-2013 after the environment impact study is completed.
Lastly, as the election draws closer, Muslim votes will become very crucial for parties in Uttar Pradesh reports Tehelka. The Samajwadi Party, Bharatiya Janata Party, Bahujan Samaj Party and the Congress led by Rahul Gandhi are all wooing the Muslim voters because there are 37 million Muslims in UP, more than in Iraq and Morocco.