• FDI shoots up 90% this fiscal to Rs 85,700 cr
• Easier regulations for rights issues soon
• Govt issues clarification on service tax refund for exporters
• No to multiple parenting for MVNOs
• Industrial production still in the red
• Unplanned urbanisation bane of Indian cities, says report
• Inadequate infra keeps businesses away: KPMG
• Ministry eases laws for foreign cruise ships
• Foreign investment inflows into India grew 90% in the first eight months of the current fiscal year, indicating that the country continues to be an attractive destination for investors despite a fall in economic growth rates. According to the FDI data compiled by the commerce and industry ministry, FDI inflows during the April-November period stood at Rs 85,700 crore compared with Rs 45,000 crore in the corresponding period of the previous fiscal. Investments from 3 Asian countries — Mauritius, Singapore and Japan — contributed more than 55% of the total inflows during the period. (ET)
• In order to encourage companies to opt for rights issue over other forms of capital raising, the SEBI has proposed a reduction in the number of mandatory disclosures to be made by companies looking to tap this route and has put out a discussion paper on the proposal inviting public comments by March 28, 2009. (ET)
• CBEC has issued a clarification stating that exporters will not get service tax refund on services consumed for export of goods before October 6, 2007. Govt had announced the refund during the release of the annual supplement to the Foreign Trade Policy in April 2007 but the notification in this regard was issued on October 6, 2007. CBEC has thus clarified that “Being prospective in nature, refund is not admissible on such services received prior to the date they are notified in the said notification, even if the goods, in relation to which these services are used, are exported after the date when such services are notified under notification No. 41/2007-ST”. The notification also clarifies that claims for service tax refunds will have to be filed from the date of export of the consignment. (BS)
• TRAI has refused to endorse DoT’s decision to allow mobile virtual network operators (MVNOs) to tie-up with more than one operator in an area for their services. TRAI is of the view that an MVNO should use the network of only one existing operator as the mobile number portability scenario in India is already complex due to large number of existing players and the situation would become further complex if multiple parenting is allowed. Calculation of spectrum charges also becomes difficult if virtual operators tie up with multiple existing telcos as each service provider has a different slab for calculating these levies. (ET)
• For the first time in 16 years, India’s factory output has shrunk for the second successive month. According to CSO data , the monthly index of industrial production (IIP) contracted by 0.5% in January, compared with a growth of 6.2% a year earlier. However, industry said the figures were still better than expected and that industrial production could end this financial year growing 3% overall. Companies are hopeful that the production of consumer durables, which reversed three months of consecutive contraction to grow 2.5%, is a sign that additional government spending is reviving demand. (FE)
• According to the World Development Report 2009 on Reshaping Economic Geography, cities are witnessing rapid urbanisation and population concentration since economic activities are mostly concentrated in these areas. Migration from economically weaker areas serves as another cause of fast-emerging trend, which has multiple ripple effects. The report cites Mumbai, the financial capital of India, as an example, which has a diverse population, and this will help determine priorities for all levels of the government (central, provincial, and municipal). (FE)
• According to a recent global survey by KPMG International and Economist Intelligence Unit, in India, reflecting the concern about the impact of India’s poor infrastructure on their businesses, over 30% of top business executives surveyed feel that infrastructure is inadequate in supporting their business,”while 95% feel that current infrastructure investment was insufficient to support the long-term growth of their organisations. Also, 90% of the respondents in India said, “poor energy infrastructure burdens their organisations with additional costs.” According to the report, India will need an investment of $500 billion in the 11th Plan period through public-private partnership mode, as well as from the private and private sectors to improve its infrastructure. (FE)
• Shipping Ministry has issued a notification stating that foreign cruise ships can take passengers all along India’s coast without restriction, thus easing a law banning foreign-registered ships from calling at more than one Indian port without a licence from the country’s maritime regulator. The relaxation is for 10 years and takes effect immediately. (Mint)
