New Delhi: The week started with good news for India’s economy. On Monday the government released statistics that show economic activity grew 7.9% in the second quarter. Economists say the growth was driven by a healthy agricultural growth of 0.9% during the quarter. But economists also say agriculture could reduce growth in the current quarter. That’s because Kharif crops, which felt the impact of this year’s poor monsoon, are being harvested now.
Weekly food inflation figures were out on Thursday. India’s food price index rose 17.47% in the week ending on the 21 November. Earlier on Thursday, the Prime Minister’s chief economic advisor C. Rangarajan said India’s high food inflation was worrying and that India may have to tighten its monetary policy to deal with it. And the World Bank joined the chorus of concern on Friday, saying excess liquidity in global markets is driving up prices of farm commodities.
Auto sales accelerated in November. Maruti sold nearly 88,000 units, an increase of 67% compared to last year. Hyundai Motor’s Indian arm saw its sales go up 29% to more than 55,000 vehicles. And Hero Honda reported a 32% rise in its sales of over 381,000 units. TVS Motor sales also increased, shooting up 23% to about 121,000 units.
Two major players are planning to cash in on India’s auto market. General Motors and SAIC of China agreed to create a joint venture that will manufacture and sell vehicles in India. The venture will be a 50-50 partnership. SAIC will invest cash and GM will pool in its Indian assets. Separately, GM will also sell SAIC a 1% stake in their Chinese joint venture, giving SAIC a majority stake in that venture.
There was a new twist this week in the battle between ABG Shipyard and Bharati Shipyard for control of Great Offshore. First Bharati Shipyard raised its open offer price for Great Offshore to Rs590 per share from Rs560 per share. Then its rival ABG Shipyard sold its 8.3% stake in Great Offshore. ABG Shipyard’s stake sale will make it easier for Bharati Shipyard to gain a controlling stake in Great Offshore.
GlaxoSmithKline and Baxter International have got government approval to conduct human trials of their H1N1 vaccines in India. The drug controller general of India says vaccine makers will begin studies on how the vaccine behaves in the Indian population. It also says India will get a minimum 4 million doses this winter, mostly for healthcare workers treating swine flu patients.
Just days before climate talks begin in Copenhagen, environment minister Jairam Ramesh announced a radical change in India’s stance on emissions. Addressing the Lok Sabha on Thursday, Ramesh pledged India would reduce its emissions intensity significantly. Under his plan, India will commit itself a 20-25% cut in its 2005 carbon intensity levels by 2020. Carbon intensity is the ratio of greenhouse gases to every unit of GDP. Just last week, China said it would cut its 2005 carbon intensity by 40 -45% by 2020.
Life Insurance Corporation has short listed Accenture for advice on regaining market share and growing faster. LIC still has a 65% market share but has been losing out to private companies in the last few years.