Remittances to developing world to reach $414 bn this year: World Bank

Developing world to get $410 bn in remittances

India and China would account for nearly a third of total remittances of $414 billion to the developing world this year, according to the World Bank. The total remittances to the developing world this year would be 6.3 per cent higher compared to 2012. "Remittance volumes to developing countries are projected to continue growing strongly over the medium term, averaging an annual growth rate of 9 per cent to reach $540 billion in 2016," the World Bank report also said. Global remittances, including those to high-income countries, are estimated to touch $550 billion this year, and reach a record $707 billion by 2016, the report added. World Bank Senior Vice President and Chief Economist Kaushik Basu said: "Remittances act as a major counter-balance when capital flows weaken as happened in the wake of the US Fed announcing its intention to rein in its liquidity injection programme. "Also, when a nation's currency weakens, inward remittances rise and, as such, they act as an automatic stabiliser." The estimates reflect recent changes to The World Bank Group's country classifications, with several large remittance recipient countries, such as Russia, Latvia, Lithuania and Uruguay no longer considered developing countries. The top recipients of officially recorded remittances for 2013 are India (with an estimated $71 billion), China ($60 billion), the Philippines ($26 billion), Mexico ($22 billion), Nigeria ($21 billion), and Egypt ($20 billion), World Bank said. Other large recipients include Pakistan, Bangladesh, Vietnam, and Ukraine. Growth of remittances has been robust in all regions of the world, except for Latin America and the Caribbean, where growth decelerated due to economic weakness in the US. The high cost of sending money through official channels continues to be an obstacle to the utilisation of remittances for development purposes, as people seek out informal channels as their preferred means for sending money home, World Bank said. The global average cost for sending remittances is 9 per cent, broadly unchanged from 2012, it added.

EOW likely to defreeze NSEL escrow account on Thursday

The economic offence wing (EOW) of Mumbai Police is likely to defreeze an escrow account of National Spot Exchange Ltd (NSEL) by Thursday morning. NSEL's escrow account was among those 58 bank accounts which was frozen by EOW on Tuesday, to investigate Rs.5,500 crore NSEL payout crisis.

Crisis-ridden NSEL had opened an escrow account after direction by the government to ensure payouts on priority to about 8,000 small investors stuck after the exchange halted trading. But on Tuesday, NSEL failed its payout seventh time in a row - giving a reason that EOW had frozen its settlement and escrow accounts, both.

In an email statement, NSEL had said, "Due to freezing of bank accounts, NSEL is unable to make any payouts on Tuesday. NSEL has informed the FMC of this development. NSEL is taking legal advices to defreeze the settlement bank accounts. Investors and members will be notified in due course."

Talking exclusively to Headlines Today, senior EOW official admitted, "It was our mistake to freeze escrow account on Tuesday. At that point of time, when all 58 bank accounts were getting freezed, we were unaware which are escrow account and which are settlement accounts." But he assured,"

For the benefit of investors, we would defreeze the escrow account at the earliest. Wednesday is public holiday, therefore, on Thursday we would communicate to the bank and will ensure NSEL's escrow account gets defreezed soon."

Interestingly, as of now, NSEL's escrow account has only Rs.18 crore. That means - payout failure was quite imminent. NSEL was supposed to make a scheduled payment of Rs.174.72 crore to investors on Tuesday.

According to settlement plan, NSEL would pay Rs.3,494.4 crore this year in installments of Rs.174.72 crore every Tuesday. The exchange has defaulted on payouts for the past six weeks and has settled about Rs.150 crore so far.

EOW has frozen total 58 bank accounts of promoters of FTIL and NSEL - which also includes personal accounts of Jignesh Shah, Anjani Sinha, Joseph Massey, Shantilal Guru, B D Pawar, Amit Mukherjee, M C Pandey, Shrikant Jawalgekar, Neerav Pandey, NSEL's auditor Mukesh Shah and others.

Read more at: http://indiatoday.intoday.in/story/eow-likely-to-defreeze-nsel-escrow-account-on-thursday/1/312804.html

Onion prices down over past fortnight

Retail onion prices in the capital have declined by about 20 per cent to Rs.60-65 per kg over the past two weeks.

Onion arrivals in Delhi and in the major markets of Maharashtra, the biggest producer of onions, have been going up in last few days.

In Delhi, the average arrival price for wholesale onion dipped from Rs.5,555 per quintal on September 17 to Rs.3,639 on September 30, a drop of over 34 per cent. The declining trend at the wholesale level is expected to reflect at the retail level with a further drop in prices this month, said a wholesaler at Delhi's Azadpur market.

The harvest of the onion kharif crop has been good in Karnataka and Andhra Pradesh. In October, arrivals will pick up in Maharashtra and Rajasthan. The two states account for one-third of country's output. October's nine day long Navratri celebrations - when people avoid eating onions - are also likely to lead to a drop in consumption and prices. With a 244 per cent rise in prices in August, onions were instrumental in driving up the August wholesale price inflation to  a six month high of 6.1 per cent. India produces about 16 million tonnes of onion but consumes only 10-11 million tonnes. Higher domestic prices had led to a resumption in imports of onion after a gap of two years and onions from countries like Egypt, China and Pakistan have found a market in India.

Remunerative domestic prices and the imposition of a higher minimum export price have slowed onion exports. In August, onion exports fell sharply to 29,247 tonnes compared to 156,165 tonnes in July and 150,512 tonnes in June. India exported 1.82 million tonnes of onion in 2012/13, valued at Rs.2,295 crore. In the first five months of current fiscal year, exports have only been 697,028 tonnes.

Read more at: http://indiatoday.intoday.in/story/onion-prices-down-retail-wholesale-delhi-maharashtra/1/312710.html

ADB clears $700 mn loan for infrastructure development

The Asian Development Bank (ADB) has approved $700 million in loans to support the Indian government's efforts to accelerate investment in infrastructure which the country requires to ensure strong economic growth.

"Poor infrastructure is one of the biggest drags on growth and development in India and there is a large investment funding gap of about $113 billion during the 12th Five-Year Plan for 2012-2017," ADB said in a statement.

This assistance to India's Infrastructure Finance Company Ltd (IIFCL) will allow it to lead the market evolution for infrastructure financing and will spur greater involvement from the private sector, said Cheolsu Kim, Lead Finance Specialist in ADB's South Asia Department.

The government estimates that $1 trillion is needed in infrastructure investment to achieve economic growth of 8.4 per cent under its current five-year development plan, and expects nearly half of that to be financed by the private sector.

However, banks which have been the key source of infrastructure finance, are increasingly unable to provide funds as they are fast approaching exposure limits to key infrastructure companies, the Manila-based multi-lateral funding agency said.

ADB's funds - provided through two loans under a multi tranche financing facility - will be used to provide direct loans for project developers and to replace bank loans, freeing up banks to provide credit in other greenfield projects, it added.

Currently, 31 road, railway, airport, urban infrastructure and energy projects, including in renewable energy, are in the pipeline to receive support from ADB.

Established in 2006, IIFCL is wholly owned by the government and its borrowing programme is fully backed by a government guarantee.

PE investments dip 67% in Q3; 9 month figure drops by 38%

Private Equity firms invested about $1.3 billion across 75 deals, during the quarter ended September 2013, registering a decline of 67 per cent over the corresponding period last year, a report says.

According to research firm Venture Intelligence, the latest numbers take PE investments in the first nine months of 2013 to $5,059 million through 281 investments.

This is down 38 per cent compared to the corresponding period of 2012 when deals worth $8,152 million were made via 373 investments.

There were only two PE investments worth over $100 million during the third quarter of 2013 compared to five such transactions in the same period last year and eight during the immediate previous quarter, the Venture Intelligence analysis showed.

Baring Private Equity Asia's Rs 1,687 crore ($260 million) buyout of 41.8 per cent stake in publicly listed IT Services firm Hexaware Technologies was the top PE deal of the Q3 2013.

Including the mandatory open offer for an additional 26 per cent stake, the deal value could go up by another Rs 1,058 crore, the report said.

The second largest transaction reported during Q3 2013 was e-tailer Flipkart's raising of an additional $200 million from existing investors including Tiger Global, Accel India, Iconiq Capital and South Africa-based strategic investor Naspers.

Led by the Hexaware and Flipkart deals and accompanied by the $75 million commitment by Softbank to another e-tailer Snapdeal.com, IT & ITES companies grabbed almost 45 per cent of the PE investments (by value) in the third quarter of this calender year.

IT & ITES ($582 million across 25 investments) was followed by manufacturing ($185 million across nine investments) and healthcare and life sciences ($140 million across 14 investments) as the most favoured industries for PE investments in Q3 2013, the report added.

India’s GDP growth likely to be at 5.2% in 2013: UNCTAD

New Delhi, Sep 12:  

The Indian economy is likely to grow at 5.2 per cent in 2013 calendar year on the back of rising domestic demand, says a report by UN agency UNCTAD.

In its release of Trade and Development Report 2013, the United Nations Conference on Trade and Development (UNCTAD) said the Indian economy is expected grow at 5.2 per cent in calendar year 2013 as against 3.8 per cent in 2012.

UNCTAD’s India growth forecast at 5.2 per cent for 2013 is however lower than the International Monetary Fund’s projection of 5.6 per cent for the year.

In case of China, the UNCTAD report said, the growth rate is expected to moderately decline to about 7.6 per cent in 2013 from 7.8 per cent last year.

“Growth in some large developing economies such as India, Brazil, Argentina and Turkey, which was subdued in 2012 is forecast to accelerate in 2013,” the report said.

Developing nations continue to be the main drivers of growth, contributing about two—thirds of global growth in 2013. In many of them, growth has been driven more by domestic demand than by exports, as external demand, particularly from developed countries has remained weak, it said.

Developing countries may grow at a rate of 4.5-5 per cent in 2013.

However, several other developing economies including South Africa seem unlikely to be able to maintain their previous year’s growth rates.

“Their expected growth deceleration partly reflects the accumulated effect of continuing sluggishness in developed economies and lower prices for primary commodity exports.

Also, the decreasing policy stimuli which were relatively weak would affect the growth,” it said.

The combination of these factors may also affect China’s growth rate, which is expected to slow down moderately from 7.8 per cent in 2012 to about 7.6 per cent in 2013, it said, adding, “even though this would be only a mild deceleration, it is likely to disappoint many of China’s trading partners.”

India’s economic growth fell to a decade’s low of 5 per cent in 2012—13 fiscal. The RBI has projected a growth rate of 5.5 per cent for the current fiscal.

Onion prices decline by about 20 per cent in New Delhi in two weeks

Retail onion prices in the capital have declined by about 20 per cent to Rs 60-65 per kg over the past two weeks.

Onion arrivals in Delhi and in the major markets of Maharashtra, the biggest producer of onions, have been going up in last few days.

In Delhi, the average arrival price for wholesale onion dipped from Rs 5,555 per quintal on September 17 to Rs 3,639 on September 30, a drop of over 34 per cent. The declining trend at the wholesale level is expected to reflect at the retail level with a further drop in prices this month, said a wholesaler at Delhi's Azadpur market.

The harvest of the onion kharif crop has been good in Karnataka and Andhra Pradesh. In October, arrivals will pick up in Maharashtra and Rajasthan. The two states account for one-third of country's output. October's nine day long Navratri celebrations - when people avoid eating onions - are also likely to lead to a drop in consumption and prices. With a 244 per cent rise in prices in August, onions were instrumental in driving up the August wholesale price inflation to  a six month high of 6.1 per cent.India produces about 16 million tonnes of onion but consumes only 10-11 million tonnes. Higher domestic prices had led to a resumption in imports of onion after a gap of two years and onions from countries like Egypt, China and Pakistan have found a market in India.

Remunerative domestic prices and the imposition of a higher minimum export price have slowed onion exports. In August, onion exports fell sharply to 29,247 tonnes compared to 156,165 tonnes in July and 150,512 tonnes in June. India exported 1.82 million tonnes of onion in 2012/13, valued at Rs 2,295 crore. In the first five months of current fiscal year, exports have only been 697,028 tonnes.