The 13th Finance Commission submitted its report to President Pratibha Patil on Wednesday. The report deals with the devolution of central tax receipts between the centre and state governments. The commission has called for fiscal consolidation along with reforms in expenditure management. It also says the centre should consider offering states a larger portion of surcharges and cesses. Finance minister Pranab Mukherjee said the recommendations of the commissions would be reflected in next year’s budget.
Also on Wednesday, Pranab Mukherjee said India’s fiscal deficit was not sustainable. He said the government would have to balance the needs of the economy with its capacity to bear the deficit. India’s budget deficit is expected to reach 6.8% in the year ending March 2010.
Food prices show no signs of coming down. India’s food price index rose 19.83% in the week ending 19 December. The RBI is concerned about soaring food inflation and on Tuesday indicated that the focus of it monetary policy was now shifting to managing the economic recovery.
The Egyptian government has invited NTPC to set up power projects in its country. It says it will provide NTPC land and also guarantee it a long term purchase of power. NTPC in turn has said it is ready to set up projects if it is also allowed to source gas for its domestic capacity. Egypt has more than 1% of the world’s proven gas reserves, while NTPC’s domestic operations are short of fuel.
Back home, NTPC is looking at options for reviving its power project in Barh in Bihar. The project has been in limbo because of a dispute with Rusian company Technoprom, which was contracted to supply power generation equipment. But NTPC is now considering awarding the contract to BHEL…NTPC and Technoprom were locked in a dispute after Techoprom demanded an additional Rs1,700 crore for work on the project because steel prices had gone up. The contract between the two companies was worth Rs2,066 crore.
Also in the power sector, Chinese company TBEA is in talks with BHEL for jointly making power generation equipment in India. In recent times, Chinese companies have sought alliances with India’s government-run firms to protect their interests from swings in the relationship between the two countries.
The government has postponed the implementation of mobile number portability to the 31 March. P portability was supposed to have been introduced in metro cities by the 31 December and in other areas in March. Mobile number portability allows customers to retain their phone numbers when they change their operator.
The Indian government has placed an order to import 1.5 million doses of the H1N1 vaccine. The vaccines will start being available in January.
Civil aviation minister Praful Patel says the worst is over for India’s airline industry. He says the recent improvement in air traffic could lead to greater stability for the airline sector in 2010.
The Drugs Controller General of India has sent a notice to GlaxoSmithKline on ads promoting its cervical cancer vaccine Cervarix. The notice says Glaxo’s campaign violates Indian laws and must be withdrawn.
Delhi Chief minister Sheila Dikshit says her government is considering a surcharge for outside vehicles entering the city. The potential move is part of an effort to cut down pollution and modernize the city’s traffic management system.
The movie 3 Idiots may be sweeping the box office, but all is not well for author Chetan Bhagat. He’s attacked the movie’s producer and its director for not properly crediting his book Five Point Someone as the main source for the film’s script… While the filmmakers insist 3 Idiots is only loosely based on the book, Bhagat says the influence is much heavier, using characters, plotlines and twists from Five Point Someone.