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Manufacturing Sector to Slow Down By 10-30 percent

Dec. 10 – India’s labor intensive manufacturing sector has slowed down and is expected to cut production by 10-30 percent over the next three months. A Federation of Indian Chambers of Commerce and Industry (FICCI) survey of 200 large and SME manufacturers released yesterday states that the leather, metals and textile industries are to be most affected, with job losses of 10-30 percent expected across the board. Due to cuts in production exports will also be affected by approximately 10-20 percent, with a 60 percent drop in leather exports expected the survey said.

India’s Commercial Capital Mumbai Attacked By Terrorists

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Nov. 27 – Terrorist’s attacked 10 prime landmarks in Mumbai at 10 pm local time last night killing at least 100 people and wounding over 900 others. Prominent amongst those shot down are chief of the anti-terror squad Hemant Karkare, Mumbai’s additional commissioner of police (east) Ashok Kamte and encounter specialist Vijay Salaskar.

A group called the Deccan Mujahideen, have claimed responsibility for the attack, however it is yet to be ascertained to which terrorist outfit they belong. Reports state that the terrorists are targeting foreigners in the city. Besides attacking prominent tourist hot spots such as the Taj Mahal Hotel, Oberoi Towers and Leopolds café in South Mumbai the terrorists reportedly asked guests in these hotels for British and American passport holders. Adding to the panic, hospitals including Cama hospital and Bombay Hospital as well as Mumbai’s largest railway station, the CST station and the Municipal Corporation headquarters have also been attacked.

Goa Tries to Prevent Foreigners from Buying Illegal land

Nov. 7 – Sun, sea and cheap land are attracting many westerners to buy illegal land from organised land mafia's along the golden beaches of Goa. Located just south of Mumbai, foreigners flock to the ideallic beaches of Goa, for a holiday, many later decide to stay on in what was formerly a portuguese colony.

According to Indian law, foreigners are free to buy real estate, but within limits: Any money invested in the country must stay in India, and for the first year, buyers must be in residence more than 182 days and file income tax.

China’s FAW Interested in Manufacturing Cars in India

Nov. 6 – Even as the dust settles on what would have been the Tata Nano plant in Singur, the West Bengal government reportedly offered the land to First Automobile Works Limited (FAW), a Chinese automobile manufacturer. Reports by the Hindu said a 12-member delegation from Chinese automobile company FAW Group Corporation met West Bengal Chief Minister Buddhadeb Bhattacharjee and Industry Minister Nirupam Sen expressing interest in setting up a joint venture automobile unit on about 600 acres – about the same size that is ‘undisputed’ in Singur — to set up a small car factory in Bengal.

Technology Companies Feel the Heat of the Financial Crisis

Oct. 24 – India's technology companies are feeling the heat from the global economic meltdown. "Our outlook is cautious in the near term given the extent of strain on the global economy," Azim Premji, chairman of Wipro Ltd. told the Wall Street Journal. Premji is pessimistic despite a sharp weakening of the Indian rupee, which helps tech companies that earn most of their revenue overseas.

A far cry from the 40 percent growth in revenues technology companies saw in the past few years, Tata Consultancy Services, India's largest IT company by revenue said revenue growth fell to 25 percent. Wipro's revenue on the other hand rose 36 percent on a year to your basis.

Singh Assures Parliament that India will Tide over Temporary Slowdown

Oct. 23 – Like most nations, India is not an insular economy, it will be affected by the global economic meltdown. Reaffirming his stance, that India's strong fundamentals will prevent it from going under, Prime Minister Manmohan Singh sought to convince foreign investors and the Indian people that although India will face a temporary slowdown, the economy will return to faster growth when the situation stabilises. Singh's statement came to parliment just after the Reserve bank of India cut its key short-term lending rate by one percent to eight percent. The prime minister also promised that inflation would come down in the next two months.

RBI releases US$30 billion into the Indian Financial System

Oct. 16 – India's central Bank, the Reserve Bank of India will cut the cash reserve ratio (the proportion of their deposits that banks have to maintain in cash with the central bank) by 100 basis points or 1 percent to 6.5 percent, releasing Rs 400 billion rupees ($8.2 billion) into the Indian banking system. This marks the third and steepest cut in CRR in the past two weeks, bringing the CRR down from 9 percent last month.

The RBI has also decided to release Rs 250 billion (US$5 billion) to commercial banks and credit institutions towards a farm waiver scheme immediately. According to the AFP. Last week the RBI announced a cash injection of 600 billion rupees (US$ 12 billion) into the financial system in two instalments. It has also doubled the investment limit for overseas investors in corporate bonds to US$6 billion.

All these measures will collectively, contribute Rs 1,450 billion (US$30 billion) to India's financial system this month.

India Eases Foreign Fund Investment Rules to Woo Cash

Oct. 7 – In order to encourage foreign inflows into India, the Securities and Exchange Board of India (SEBI), India's capital market regulator lifted curbs on indirect investment notes by foreign funds to spur inflows into a battered stock market. SEBI initiated the change to stem record sales by offshore funds that have triggered a 42 percent slide in the benchmark index this year, Bloomberg reported.

A requirement forcing investors to register in India before buying shares and limits on offshore derivatives that were imposed in October will be lifted with immediate effect, C.B. Bhave, chairman of the Securities & Exchange Board of India, told reporters after a board meeting in Mumbai.