Nik's Diary
The Indian markets opened flat to positive tracking flat opening
in SGX Nifty and of major Asian markets. The US markets moved mostly higher
over the course of the trading day on Monday, partly offsetting the steep
losses that were posted last week. The upward move on the day reflected strong
gains by technology and resource stocks. The major averages all ended the day
in positive territory, although the Dow under performed its counterparts. The
European markets pared their gains in late trade Monday, but still largely
finished to the upside. The markets were positive in early trade, on the news
that Italy's parliament re-elected President Giorgio Napolitano for a second
term on Saturday. Meanwhile, Indian markets ended at a one month high.
Continued expectations of a cut in key interest rates by the RBI helped to keep
investor sentiments buoyant on Monday. With inflationary pressures easing and
the rupee remaining more or less stable, most analysts expect the RBI to cut
interest rates next week for a third time this year.
CCI clears 25 oil & gas
blocks and 13 power projects
The Cabinet Committee on
Investment (CCI) on Monday cleared 25 exploration and production blocks,
freeing Rs 24,900 crore investments, while also approving 13 power projects,
entailing investments worth Rs 33,000 crore. "The CCI at its meeting held
on Monday cleared 25 exploration and production blocks for continued
exploration of oil and gas, out of 31 blocks where work had been stopped on
account of security restrictions imposed by ministry of defence," an
official statement said here. While the statement did not give break-up of the
blocks cleared, the 31 blocks where restrictive conditions were imposed
included 13 of Reliance Industries-BP combine, 15 of state-owned Oil and Natural
Gas Corp or its lead consortium, two blocks of Santos of Australia and one
block of Cairn India-led consortium. For these blocks, the Defence ministry had
imposed stringent conditions like asking companies not to locate any pipelines
or structures on sea surface in the blocks cleared for exploration and
production activities. Of the 20 power projects reviewed by CCI, 13
projects involving investment of about Rs 33,000 crore have been cleared, an
official statement said. "These 13 projects include 10 transmission, one
hydro and two thermal projects," it said. CCI reviewed the status of 20
projects, each with investment of Rs 1,000 crore or more, which were pending
for different types of approvals and clearances with a view to expediting
decisions on approvals and clearances, it added. Source: TOI
CCEA says no to price pooling of coal
The government today buried a proposal to pool
prices of imported and domestic coal to make the fuel affordable to new power
plants, owing to sharp opposition to the scheme. "Price pooling is
out of the window," a source attending the Cabinet Committee on
Economic Affairs on the issue said here. While no formal reason was
given for burying the proposal, the source said power projects commissioned
before 2009 will continue to get coal at pre-fixed (below market) rates. New
projects commissioned after 2009 largely have a cost-plus mechanism for
calculation of electricity tariff and so any higher imported cost of coal will
be passed through to the consumers, he said. Private power producers
wanted the sub-market domestic coal prices to be averaged out with
international price of imported coal so as to have a uniform fuel price and
remove the disadvantage new projects faced as compared to older ones. The
pooling was being opposed for various reasons by older power plants and
domestic coal producers. "For the remaining 24,000 MW projects it is
work in progress...remaining being which have tariff based linkages, which have
no PPAs or which have tapering linkages," the source said.The committee,
which was looking into the issue, will come back to CCEA (Cabinet Committee of
Economic Affairs), he added. The power projects commissioned before 2009
aggregating a capacity of 65,185 MW will get coal at domestic prices, whereas
post 2009 projects, with a capacity of 36,000 MW, which have signed Power
Purchase Agreements (PPAs) with the procurers will get the dry fuel at cost
plus basis. Cost plus basis is the total cost at which the imported coal
will be supplied to the power generation companies including the additional
charges as well as transportation. This mechanism may lead to increase in
electricity tariffs if the generation companies passes the rise in cost to the
consumers. Price pooling is averaging the price of imported and indigenous
coal to arrive at a uniform stock price. An inter-ministerial panel was
formed, under the chairmanship of Coal Secretary S K Srivastava, to look into
the matter, which was impacting power generation in the country. The
Cabinet Committee on Economic Affairs in February had approved in-principle the
price pooling mechanism. Planning Commission Deputy
Chairman Montek Singh Ahluwalia recently had said that coal pool
pricing may lead to revision in power tariffs. The Prime Minister's Office
had earlier directed CIL BSE 0.67 % and Central
Electricity Authority (CEA) to work on pooling coal prices to ensure 80
per cent supplies to power plants. Source:
Economic Times
Strike at MM's Igatpuri plant ends
The work at auto-major Mahindra & Mahindra's
engine manufacturing facility at Igatpuri, near Nashik, resumed today
ending the 14-day "tools down" agitation by workers, who were
protesting the suspension of two employees including a union leader. The
company management gave into the Union's demand of reinstatement of the
suspended workers after the intervention of Shiv Sena president Uddhav
Thackeray, who had a meeting with a senior Mahindra Group official on
Saturday, a Union leader said today. Besides, the management also agreed
to withdraw the chargesheet proceedings against the suspended duo, he said.
"The employees have called off the agitation and work at the plant has
resumed from 11 am,"Bhartiya Kamgar Sena President Suryakant Mahadik
told. The Employees Union at the engine plant is affiliated to BKS of
the Shiv Sena. The plant produces 1100 engines per day in three shifts for
Mahindra's vehicles such as XUV 500, Bolero, Xylo, Genio and Maxximo. Sources
at the plant said that the company suffered a production loss of around 8,000
units due to the agitation, which began on April 9. "Since the plant
remained crippled for almost two weeks, the company suffered a production loss
of 1100 units per day. The loss would have been higher but for two weekly offs
and two holiday during the protest period," Union sources said. However,
the claim could not be verified as the company did not put any number to it.
Around 1600 employees, including contract workers, were on protest since early this
month against the suspension of Union leader Sunil Yadav and another
worker. After his talks with the company management, Thackeray called a meeting
of the Union Committee at 'Matoshree' here yesterday and asked them to withdraw
their agitation. Source:
Economic Times
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