Rajan questions farm debt waiver schemes

6
T HE ECHO OF INDIA SILIGURI
Economy & Business
Sunday December 28, 2014
Rajan questions farm debt waiver schemes
Udaipur, Dec 27 /—/ Putting a
question mark on the effectiveness
of the Union government’s farm
debt waiver programmes, RBI Governor Raghuram Rajan Saturday
said such schemes have constrained
flow of credit to farmers.
“In some states on certain occasions we have had debt waivers.
How effective these debt waivers
have been? In fact the studies that
we have typically show that they
have been ineffective. In fact they
have constrained the credit flow
post waiver to the farmers,” he said
at the annual conference of Indian
economic association.
On farmers suicide, he said
there was need to study this important and sensitive issue.
“One question is how else we
should deal with over indebtedness
in the farm sector. Also worth examining very important issue is of
farmer suicide. How much they are
caused by indebtedness especially
to the formal (banking) system, how
much formal system alleviates indebtedness....,” the governor said.
Andhra Pradesh and Telangana
gover nments have dec lared loan
waivers for the farmers hit by cyclone Phailin last year.
While the Telangana government has given the mandated 25 per
cent of the written off loan amount
to the banks, Andhra Pradesh has
not done it so far. Banks have over Rs
1.3 lakh crore exposure to the farm
sector in these two states.
In 2008, the then UPA government at Centre had come out with
Agricultural Debt Waiver and Debt
Relief Scheme (ADWDRS) 2008 under which 3.69 crore small and marginal farmers and 60 lakh other farmers were given debt relief to the extent of Rs 52,516 crore.Government
auditor CAG had found in several
cases that ineligible farmers were
given benefit while deserving were
left out, pointing to large-scale possibility of fraud.
Talking about subsidies for farm
sector, Rajan said that it will be useful to see whether these subsidies
have actually helped agriculture or
not.
“...The positive aspect is that
you are giving a benefit, a cheap
credit to agriculture. The concern,
however, is whether this credit is
being put to right use or is it leading
to
over
indebtedness
or
distortionary investment.
“We, for example, have crop loan
that we have subsidised.
But we don’t subsidise longer
term loans. Does that change the nature of what kind of activities are
subsidised in agriculture? So that’s
one issue...,” he added. (PTI)
Japan first
nation to
approve Novartis
psoriasis drug
GENEVA, DEC 27 /—/
Swiss pharmaceutical company Novartis said Friday it
has won approval to market
its Cosentyx psoriasis treatment in Japan, making it the
first country to authorise
commercialisation of the
drug. The Japanese decision allows Novartis to sell
secukinumab, sold under
the name Cosentyx, to adult
patients suffering psoriasis
vulgaris and psoriatic arthritis, and who aren’t responding to other medication. The drug is considered
by e xperts to have potentially enormous market
value of between USD 1 billion and USD 2.5 billion annually. It’s estimated 3 percent of the world’s population, or over 125 million
people suffer from some
form of psoriasis, including
over 400,000 individuals in
Japan alone.
Psoriasis vulgaris is a
skin disease provoking
thick, itchy lesions, while
the articular variant causes
stiffness and pain in joints.
Novartis said in a statement that during clinical
testing of the drug, 70 per
cent of patients experienced improvement or complete clearing of their psoriasis symptoms.
Approval in Japan follows the recommendation
by European drug regulators in November that
Cosentyx be approved for
sale as a first-line treatment
of psoriasis.
Similarly, the US Food
and Drug Administration is
expected to approve the
medication in early 2015 after its panel of experts issued a similarly positive
recommendation in October.
Novartis says Cosentyx
is a human monoclonal antibody that neutralises a protein present in high levels of
concentration in psoriasis
patients.
Bengal has highest number
of lockouts: Minister
KOLKATA, DEC 27 /—/ West Bengal has
the highest number of lockouts in the
country, Union minister of state f o r
Labour and Employment Bandaru
Dattareya Saturday said.
“I have gone through reports on
lockouts which showed that the highest
number of lockouts in the country are
in West Bengal,” Dattareya told reporters while talking about the steps taken
by the Narendra Modi gover nment to
address labours’ issues in the country
here today. Asked about reasons behind
the lockouts in West Beng al and
whether he was focusing on any particular time regarding the issue, the
minster said “I cannot tell you the specific reason behind this. I am not talking about the present situation but in
totality.” “Lockouts is going to be a big
problem. Workers should not come out
on the road and workers’ security is my
prime job ... Not only their social security but also their employment has to be
taken care of,” he added.
Stressing that West Bengal needed
to create a ‘conducive atmosphere’ to
enhance development and safeguard
workers’ issues here, the central minister said “I want conducive atmosphere
should be created everywhere in the
country, particularly in West Bengal.
More jobs have to be created and unless
the relation between employer and employee is harmonious no development
can speed up.”
Dattareya said he has invited state
Labour Minister Moloy Ghatak to Delhi
to discuss other matters including this.
He described that the situation in
the tea g a rdens of West Beng al and
Assam as ‘pathetic’.
“The Centre is keen to help the state
gover nments particularly for the tea
plantations because situation there is
pathetic. In some places workers are on
strike... I have already spoken to the
Ministry of Commerce and we will formulate and help the tea plantation
workers,” he said. (PTI)
No violation of safety norm or
unfair seat allotment: Air India
(L-R) Nevil Sajani, VP, Corporate Strategic Allanze Ltd. with Manish Jainm CMD of NCML LTD., (A Delhi Base
Company) addressing about to proposes to enter the capital market with IPO to open on 29th December 2014, with
an offer for sale of 60,00,000 equity shares of the face value of Rs.10 each by selling shareholders in Mumbai.
Now, people in Indore too
can buy vegetables online
Panama Canal claims
$ 737m in cost overruns
INDORE (MP), DEC 27 /—/ Moving away from electronic
goods, clothes and groceries that one can shop online, a local vendor has gone one step ahead by providing people,
specially women the facility to order vegetables and fruits
of their choice with just a click of a mouse.
Possibly the first store of its kind in Madhya Pradesh,
subzistore indoreveg.com shop offers vegetables online.
“When a large number of goods were being sold online,
why not vegetables,” asks vendor Omprakash Bhatt.
“Today, many companies are doing trade worth crores
through online medium. If they can do so.. they why can’t
the traditional vegetable market can foray into this
internet revolution,” he asked.However, he informed that
a similar online organic vegetable store is already working
in Mumbai. Four men have been employed by Bhatt to deliver vegetables and fruits to customers at home from 7 AM
to 12 PM and from 4 PM to 8 PM after collecting orders
online. Now spices are also available with this facility.
The customer has to register himself on the website after which they are alloted a username and password for
login. After delivery of vegetables/fruits, store employees
collect cash on delivery from the residence itself.Bhatt said
the facility is getting a good response.A first time customer,
Abhinandan Singh said that purchasing fresh vegetables/
fruits and its home-delivery was a pleasant surprise for his
wife and both of them have decided to stick to this medium
in future too. (PTI)
PANAMA CITY, DEC 27 /—/ The consortium expanding
the Panama Canal is making fresh claims for cost overruns
totaling USD 737 million, officials have said.
Canal administrator Jorge Quijano told reporters that
the Panama Canal Authority had received two claims on
Tuesday that “will be evaluated” to determine if there is
probable cause. But he warned that “at first glance, the issues will be very difficult for the counterparty to justify.”
And in the latest setback for the behind-schedule, overbudget upgrade, a union representative said excavation
work was on hold after negotiations broke down between
the consortium and workers who have been on strike since
Tuesday. About 1,000 workers are on strike, demanding better safety and treatment. Talks between the two sides are
due to resume Monday.
One of the consortium’s latest claims, for USD 333 million, is related to the weight of the gate for the third set of
locks it is building for the canal — at 55,000 tonnes, compared to the 35,000 tonnes initially planned.
But Quijano pointed to a clause in the contract according to which the canal authority would pay up to the value
of a gate weighing 49,000 tonnes.The second claim, for USD
404 million, is due to delays in the fourth phase of excavation in the Pacific sector. The consortium, Grupos Unidos
por el Canal, says that the delay in excavation work may
mean it will not receive water needed to test the gates.
Quijano, however, said he has a “plan B” to provide the
necessary water for testing.
The canal authority will pay another USD 120 million
in adjustments to the contract and other small claims,
Quijano said. Work began in 2007 to expand the canal with
a third set of locks to enable it to handle the modern megafreighters that global shipping companies prefer.
But the USD 5.25 billion project has been plagued by
delays, strikes and a bitter dispute over USD 1.6 billion in
cost overruns with the consortium carrying out the upgrade,
led by Spanish construction firm Sacyr.
Initially scheduled for completion in 2014, the project’s
due date has been pushed back to early 2016.
Nearby Nicaragua, meanwhile, launched construction
this week on a rival canal, a USD 50 billion project that the
Chinese firm behind it plans to complete in five years.
NEW DELHI, DEC 27 /—/ Air India Saturday said its fight safety wing is looking into the issue of a daughter of a senior pilot resting in a bunk, meant
only for use of flight crew members,
during one of its flights to Newark
from Mumbai recently.
However, it asser ted that the incident “did not affect the flight safety of
any crew”. The airlines also rebutted
allegations made by a former cabin
crew that one of the airline’s prebooked first class passengers was denied a seat to accommodate a senior
bureaucrat during one of its flights
from Frankfurt.
K V J Rao, a union leader and
fo rmer Air India cabin crew, had alleged in his complaint, lodged with
civil aviation secr etary, that a first
class passenger was forced to sit in the
executive class on one of the national
carrier’s flight to Delhi from Frankfurt to accommodate a senior bureaucrat last month.
Besides, Rao had also alleged in the
complaint that the daughter of a senior Air India pilot violated DGCA
norms as she was first allowed to sit on
the jump seat and then rest in the bunk
during the 14-hour long flight to Newark in the US from Mumbai on Decem-
Edible oils surge
on rising demand,
import duty hike
MUMBAI, DEC 27 /—/
Prices of both groundnut oil
and refined palmolein
surged at the Vashi oils and
oilseeds wholesale market
here today on rising demand
from stockists and retailers
due to ensuing festivities.
Besides, they were
weighed by the recent 5 per
cent hike in import duty.
Meanwhile, castorseed
bold, castor oil commercial
and linseed oil maintained a
steady trend in the absence
of any largescale buying
activity. In the edible se gment, groundnut oil rose by
Rs 15 per 10 kg to Rs 910 from
Friday’s closing level of Rs
895 and refined palmolein
advanced by Rs 11 per 10 kg
to Rs 523 as compared to Rs
512 previously. Moving to
non-edible
section,
castorseeds bold, castor oil
commercial and linseed oil
finished unaltered at Rs 4,275
per 100 kg, Rs 885 and Rs 750
per 10 kg, respectively. (PTI)
ber 13.
“The daughter of the captain travelling or resting in a crew seat did not
affect the flight safety of any crew as
she was resting in the cabin crew rest
area where in six business class seats
are allotted for cabin crew to rest during the flight,” an Air India statement
said.
The flight safety department has
been asked to look into this issue and
submit a report, the statement added.
On the issue of denial of seat, it
said, “There was no first class on the
said aircraft which was a Dreamliner
787 which operated from Frankfurt to
Delhi. The upgrade was based on subject to availability and the said upgraded passenger did not deny any revenue paying passenger of a seat.”
“After the closure of the check in, a
business class passenger who arrived
on a delayed Air Canada flight and
missed her connection wanted to urg ently tr avel to India and voluntary
a g reed to travel economy class since
the flight was full,” it said.
Therefore, the allegation that the
officer was bumped up to first class at
the expense of the legitimate passenger is totally incorrect, Air India said.
(PTI)
News In Brief
Domestic electronic goods
NEW DELHI, DEC 27 /—/ All ministries and departments
will henceforth have to prefer domestically-manufactured
electronic products in government procurement, according
to a new directive influenced by Prime Minister Narendra
Modi’s ‘Make-in-India’ initiative. A Committee of Secretaries has decided that all Ministries and Departments should
identify department-specific, domestically-manufactured
electronic products for procurement and notify them
within a fortnight, a PMO statement said here on Saturday.
The move is aimed at boosting domestic production of electronics, the statement added.
RIL’s Nagothane plant
MUMBAI, DEC 27 /—/ Reliance Industries Ltd (RIL) Saturday said some of the downstream and gas cracker units
at its Nagothane manufacturing site will be shut for nearly
four weeks, starting mid-January 2015. RIL has scheduled
a planned turnaround at its Nagothane manufacturing site
and the cracker and some of the downstream units will be
shut for approximately four weeks, starting around midJanuary 2015, a statement issued here said. This opportunity will be used to carry out routine maintenance activities and for implementing other profit improvement and
energy conservation measures. RIL’s crackers and other
downstream units at other locations will continue at normal
levels of operations. (PTI)
Sensex off from 1-1/2-wk high, down 130 pts during the week
MUMBAI, DEC 27 /—/ After logging 1-1/2-week high
on the first day of the week,
the benchmark S&P BSE
Sensex afterwards reacted
downwards by 130 points to
end the shortened week at
27,241.78 on sustained
heavy sell-of f by foreign
funds amid profit-booking
as derivatives December
contract expired on December 24. The BSE and the
NSE remained closed on
December 25, 2014 for observing “Christmas Holiday”. The market got no major trigger from overseas
markets following Christmas holiday atmosphere.
Expectations of early
hike in the key interest rates
by the US Federal Reserve
in the world’s biggest
economy after data showed
the fastest economic growth
in more than a decade in
third quarter. It will
strengthened the dollar and
will affect the inflows negatively in the emerging mar-
WEEKLY-REVIEW
kets, including the India.
This also resulted in
profit-booking by wary operators and retail investors.
The marke also suffered
after the government unable to get pass the key legislative reforms bills during
the winter session of the
parliament. Failure to pass
the GST Bill till now has led
to market disappointment
as it had discounted the successful approval of the Bill
in the current session itself.
Markets gave a mixed
response to Jharkhand and
Jammu & Kashmir election
outcome impacting the investor sentiment.
The BSE 30-share barometer resumed the week
higher and touched a 1-1/2week high of 27,851.10 after
Finance Minister Arun
Jaitley’s statement that India could well achieve 6 per
cent growth next fiscal and
the vision to achieve 9-10
per cent economic growth,
cheered participants.
Later, it fell back to oneweek low of 27,091.38, before concluding the week at
27,241.78, down by 130.06
points or 0.48 pct.
The wide-based 50-issue
CNX Nifty of the NSE
moved in a range of 8,364.75
and 8,147.95 before settling
at 8,200.70, a net fall of 19.65
points or 0.24 pct.
December 23 and 24 saw
heavy profit-booking as December 24 was the last day
of expiry of derivatives
contract, chiefly in IT, oil &
gas and capital goods
shares, ignoring government approving the ordinance route to implement
insurance and coal reforms.
Meanwhile, the Union
Cabinet approved promulgation of the Ordinance on
insurance bill, re-promulga-
tion of the coal Ordinance
and allowing up to 100 per
cent FDI in medical devices
in the pharmaceutical sector under automatic route.
“Lack of market cues
both globally and domestically and liquidity drench
owing to festive season in
the West kept markets sideways for the day,” said
Rakesh Goyal, Senior Vice
President, Bonanza Portfolio. Brokers said they expect
fresh foreign funds to flow
after on-going Christmas
holidays and in the next calender year. Investors refused to take big risks ahead
of the year-end holidays.
Jignesh Chaudhary,
Head of Research, Veracity
Broking
Services,”The
week local indices traded
weak and is heading towards to post its monthly
fall to end the year as global
markets are trading under
pressure over the global
slowdown concern. The
price sensitive shares
traded low as FIIs continued
to be on the selling side for
the twelveth session in a
row till 24th December in
the local equities. In these
twelve sessions FIIs have
sold shares of worth Rs
8,595 crores which has
forced market to trade
weak.” (PTI)