Sensex at 5-month low; Punj Lloyd falls

MUMBAI: Indian shares fell more than 1% to their lowest in more than five months on Tuesday as high inflation and hardening interest rates continued to dent investor confidence, but export-driven outsourcers bucked the trend on improving global prospects.

Lower Asian markets and subdued outlook for foreign fund inflows also weighed on the market. Trading was choppy with engineering and construction firm Punj Lloyd sliding 8 per cent after it reported net loss for the December quarter.

By 11:41 am (0611 GMT), the 30-share BSE index was trading down 0.9% at 17,875.14 points, with 18 of its components declining. It had hit 17,848.25 at one stage, its lowest level since August 2010. "It is indecisive for now, but I see a weak trend over the next three months, until macro factors improve," said Prakash Diwan, head of institutional business at Networth Stock Broking.

Foreign funds have withdrawn $1.3 billion from Indian equities since the start of 2011 and the benchmark index has shed 12.7% in the year to date.

Software services firms Infosys Technologies and Wipro rose 0.7% and 0.5% respectively after rival Cognizant Technology Solutions Corp forecast strong 2011 results, underlining a gradual recovery in technology spending.

The sector index was up 0.3%. "We continue to believe FY12 is likely to be another 26-30% growth year for tier-I vendors as was the case in FY11," Edelweiss said in a note on the IT sector. "Recent demand is driven not just by cost-outs, but also by significantly higher IT spending by companies targeted at revenue productivity, and is sustainable."

Wipro said after market hours on Monday it had reorganised its key IT outsourcing business, less than three weeks after it named a new chief executive as it seeks to win more clients. In the broader market, losers were more than thrice the number of gainers on volume of 97 million shares.

The 50-share NSE index was down 0.9% at 5,348.90. The MSCI's measure of Asian markets other than Japan was down 0.2% while Japan's Nikkei was trading 0.4% higher.

STOCKS ON THE MOVE
Bharati Shipyard dropped 1% to 156.74 rupees after the second-largest private shipbuilder reported a 30% fall in December quarter net profit.

Fortis Healthcare rose 2.8% to 143.85 rupees after the hospital operator said its December quarter net profit rose 58.7%..

TOI

Manmohan Singh to dedicate new Kerala port to nation on Feb.11

Vallarpadom (Kerala), Feb.7 (ANI): The Prime Minister, Dr. Manmohan Singh, will dedicate the

International Container Trans-shipment Terminal (ICTT) at Valarpadom, Kerala, to the nation on February 11.

The new port, which will be privately operated by Dubai Port World, has been facing constraints in the form of protests and strikes by major trade unions of the existing Cochin Port, who are demanding job security.

The Vallarpadam Port will be the largest single operator container terminal in India and the first in the country to operate in a special economic zone.

The new terminal will make Cochin a key centre in the shipping world, reducing India's dependence on foreign ports to handle trans-shipment.

The Dubai Port World has been granted a 38-year concession for the exclusive operation and management.

Dr.Singh laid the foundation stone of the terminal in January 2005. It has been built at a cost of more than Rs 3,000 crore and is expected to help bring down freight cost in India's international trade through shipping.

The terminal will be completed in three phases. In the first phase, with a 600-metre-long quay and a water-depth of more than 15 meters, the terminal is capable of handling large container vessels and can handle one million 20-feet containers (TEUs) annually, said Anil Singh, Managing Director and Vice President, Dubai Port World (Subcontinent).

He aslo added that once completed, this will be the jewel of India and will be remembered for generations.

Today, over 40 to 45 per cent of the country's containerised cargo is trans-shipped through Colombo, Dubai or Singapore.

Though the container terminal was awarded on Build Operate Transfer (BOT) basis to Dubai Port World, the Dubai government-owned international terminal operators, it was the responsibility of the Cochin Port Trust to develop road, rail and other infrastructure to provide hinterland connectivity.

The capacity will be enhanced to 1.5 million TEUs (Twenty Feet Equivalent Units) in the second phase; once fully commissioned the capacity will be 5.5 million TEUs. By Juhan Samuel (ANI)

Rupee loses against dollar, trading at 45.59/60

MUMBAI: The rupee failed to maintain initial gains and was trading flat at Rs 45.59/60 against the US dollar in early trade on the Interbank Foreign Exchange today amid mild dollar demand from banks and corporates.

The domestic unit opened lower at 45.61/62 per dollar as against last weekend's close of 45.59/60 per dollar, but firmed up immediately to 45.53 per dollar.

However, it failed to maintain the initial gains and was ruling steady at Rs 45.59/60 per dollar after moving in a tight range between Rs 45.53 and Rs 45.62 per dollar in morning deals.

The dollar extended its gains in the New York market last Friday following a mixed US jobs report that showed a decline in unemployment picture, but disappointing growth in payrolls.

Meanwhile, the Indian benchmark Sensex was trading higher by 49 points, or 0.27 per cent, in early trade today.

Sensex opens 127 points higher

MUMBAI: The Sensex gained nearly 127 points in opening trade on the Bombay Stock Exchange (BSE) today as investors targeted fundamentally strong stocks available at attractive prices.

The 30-share BSE index rose by 126.87 points to 18,135.02 in early trade on Monday after shedding 441.16 points in the previous session on Friday.

Similarly, the broad-based National Stock Exchange Nifty index also moved up by 35.75 points to 5,431.50 points.

Brokers said the investor sentiment was boosted by fresh buying on the back of firming global trend.

In particular, IT and refinery sectors available at attractive lower levels garnered a lot of investor interest.

Meanwhile, Japan's Nikkei index rose by 0.69% in early trade today. In the US, the Dow Jones Industrial Average ended 0.25% higher in the last session on Friday.

TOI

NEW DELHI: Nearly 7,000 expatriates are caught in a battle between India and the United States over contributions made by their citizens towards provi

NEW DELHI: Finance minister Pranab Mukherjee on Monday said the 8.6% economic growth estimated for the current fiscal was satisfactory in the wake of the rising inflation and trade imbalances.

"A 8.6% is quite encouraging despite all these difficulties. Now the other issue is inflation, trade balance... these are to be addressed," Mukherjee told reporters.

Mukherjee said despite challenges "it is quite encouraging that it (GDP) is not deteriorating."

The Central Statistical Organisation (CSO) estimated economic growth for the current financial year at 8.6%, as against 8% a year ago.

"All along I was maintaining, it should be around 8.5% plus. 8.6% is accepted. My concern is also about the inflation and trade balance," he added.

The 8,9% growth in the first half of the current fiscal notwithstanding, the government is battling high inflation, particularly food inflation.

The overall inflation has remained above the comfort zone of 5-6% for over a year now.

In December, the inflation has shot up to 8.43%, from 7.48% in the previous month.

The food inflation is ruling at 17.05% for the week ended January 22.

The RBI in its quarterly monetary policy review last month upped the March-end inflation projection to 7%, from 5.5%.

In the July-September quarter this fiscal, the Current Account deficit (CAD) surged by 72% to $15.8 billion, compared to $9.2 billion in the same period last year due to higher imports.

The country''s CAD, representing the difference in inflows and outflows of foreign exchange, barring capital movements, stood at 2.9% of the GDP last fiscal.

TOI

New PF norms leave expats in lurch

NEW DELHI: Nearly 7,000 expatriates are caught in a battle between India and the United States over contributions made by their citizens towards provident and pension funds and social security.

The Employees Provident Fund Organization, which handles provident and pension funds for the organized sector employees in India, recently tightened the norms which has resulted in protests from expats, and their employers. Following the amendments, international workers would be permitted to withdraw their accumulated balance only after they turn 58. Though contribution to PF and Employees Pension Scheme (EPS), which amounts to 12% of the monthly pay, was mandated in 2008, withdrawals were permitted at the end of an expat's employment in India. Now, withdrawals are only permitted in case of permanent and total incapacity to work or in case of those suffering from cancer, leprosy or tuberculosis.

An exemption towards EPFO contribution has only been made in case of employees from countries with which India has signed Social Security Agreements and the list includes three nations-Belgium, France and Germany. For India, this is retaliatory action prompted by the refusal of the US to sign a Totalization Agreement that would make it possible for Indian professionals, several of whom are IT company employees on onsite visits, to get their dues when they finish their employment. In the absence of a Totalization Agreement, the US refused to refund the money deducted from the salaries of Indian professionals towards social security contribution.

Despite the Indian government making a case for a pact for over a decade, the US has refused to sign one saying India does not have a social security system. It has refused to accept the EPF or even the New Pension Scheme as one. In the absence of an agreement, Indians working in the US have complained for years that they are losing significant amounts.

A consultant told TOI that the EPFO amendment makes it virtually impossible for an international worker to withdraw money from his or her PF account or from the EPS. "You need a bank account into which money can be transferred by EPFO and in the absence of a visa, you cannot have a bank account," the executive at one of the largest global consulting companies said. A senior EPFO official said that in due course, transfer to an account overseas might be permitted. But an FAQ (Frequently Asked Questions) on the EPFO website is silent on the proposal.

"Most of the international workers are well below the retirement age of 58 years and come to work in India for a limited number of years. If they are not permitted to withdraw the PF amount until the age of 58, huge sums of money will get blocked in their PF accounts (and may well be lost) since it would be extremely challenging for them to come back and reclaim this money upon retirement," consulting firm PricewaterhouseCoopers said in a recent report. It further said that change was even more significant for those who had been contributing since 2008 as they were expecting to recover their contributions at the time of their repatriation and will have to wait for may more years to "get their rightful dues".

Increasingly, foreign nationals are coming to the country for work to have India on their curriculum vitae. In addition, global corporations are posting expats in India to service international clients out of here. So the number of people affected by the EPFO order is going to rise in the absence of a Totalisation Agreement.

TOI

26/11: Mumbai court verdict on Kasab death sentence on February 21

MUMBAI: The Bombay High Court on Monday set February 21 as the date when it will pronounce its verdict on Pakistani terrorist Mohammed Ajmal Kasab, sentenced to death for his role in the 2008 Mumbai terror attack.

The court announced that it will give its verdict on February 21 confirming or commuting the death penalty of Kasab awarded by a lower court last year, said special public prosecutor Ujjwal Nikam.

The high court will also the same day decide on Kasab's appeal against the award of death sentence to him by the lower court, his lawyer Farhana Shah said.

The matter came up before the Bombay High Court on Monday for further directions in the case, the hearings on which were concluded three weeks ago.

On November 26, 2008, Kasab and nine other Pakistani terrorists sneaked into south Mumbai through the Arabian Sea route and targeted various locations, including the Chhatrapati Shivaji railway terminus, Taj Mahal Palace & Tower Hotel, Hotel Trident-Oberoi, and Nariman House which housed the Jewish Chabad House.

The 60-hour mayhem left 166 people dead, including many foreign nationals, and over 300 injured.

TOI