Indian Rupee Down 6 Paise Vs Us Dollar Morning Trade

The India rupee depreciated by 6 paise to 62.42 against the dollar in early trade today at the Interbank Foreign Exchange market on increased demand of the US currency from banks and importers.



Forex dealers said a lower opening in the domestic equity market also put pressure on the rupee.



The Indian rupee had fallen by five paise to 62.36 against the dollar in yesterday's trade.



Meanwhile, the BSE Sensex fell by 39.47 points, or 0.19 per cent, to 20,815.45 in early trade today.

Source : financialexpress.com

Coal India To Resume Output At Talcher Field Shut By Labour Protest

Coal India Ltd said it would resume full production on Wednesday from a major coal field that was closed on Friday due to a labour protest, cutting off a supply of about 200,000 tonnes a day to power producers and others.

The Talcher field, comprising seven open cast mines, is run by the Mahanadi Coalfields unit, which last fiscal year acounted for nearly a quarter of the output from state-owned Coal India, the world’s biggest coal producer.

“Today we started production at half of our capacity and expect to resume full production from tomorrow,” Mahanadi Coalfields chairman A.N. Sahay told Reuters.

Mahanadi Coalfields, with operations in eastern Odisha state, supplies power producers such as NTPC Ltd and aluminium maker National Aluminium Co Ltd.

NTPC said in a letter to Mahanadi Coalfields, seen by Reuters, that the 3 gigawatt Talcher Super Thermal power station was fast running out of coal because of the shutdown, threatening power supplies to many eastern and southern Indian states.

Satay said on Friday that a new contractor had taken over coal loading and other activities at two railway sidings and was using new workers, which led to violent protests by the employees of the previous contractor.

Prohibitory orders have now been imposed at the two sidings, and Mahanadi Coalfields will make use of other sidings to transport coal, Superintendent of Police Narasimha Bhola said.

“The trouble related to mining ... coal crisis, that thing is over,” he said.

The later shutdown of the Talcher field, along with a hit to production from a cyclone in October, means that Coal India will find it a challenge to meet its output target of 482 million tonnes for the financial year ending March, chairman S. Narsing Rao told reporters in New Delhi.

Coal India, which accounts for more than 80 per cent of India’s coal output, produced 289.4 million tonnes from April to November, 5% below its target.

As a result of its inability to raise output in line with demand, India has become the third-largest importer of coal, even though it sits on what BP has estimated as the world’s fifth-largest reserves.

Cane Prices Likely To Be Linked To Sugar Prices From Next Season

Will the UP government bow further to the pressure of the powerful sugar lobby in the next crushing season? With the state government conceding to the demands of the sugar mills of paying state advisory price (SAP) to farmers in two installments in the current crushing season, all eyes are on the high power committee headed by the UP chief secretary that is likely to give its recommendation on linking cane prices with sugar prices in the next crushing season.



Sources said setting up such a committee was one of the crucial steps taken by the UP government which not only paved the way to break the deadlock between the state government and the millers but also infused some confidence in the industry to run the mills in the interest of farmers. The millers have been demanding application of the Rangarajan committee recommendations as a formula for determining cane prices in the next crushing season. If that happens, the SAP would automatically drop with the sugar prices. The new pricing formula, however, is likely to come into operation in the next crushing season, that is, after the Lok Sabha elections are over, when the SP government will not be under pressure of losing its crucial farmer vote bank.



Principal secretary cane development Rahul Bhatnagar said the state government will be looking at all the aspects of linking cane prices with sugar prices. "The state government will be looking into all aspects while determining the cane prices," he said. "It is better not to say that only Rangarajan committee recommendations will be taken into account," he added.



The Indian Sugar Mills Association (ISMA) has been demanding application of Rangarajan formula. Director general of ISMA, Abinash Verma said that the state government has assured the millers for coming up with 'long term sugarcane pricing policy'. "We will welcome the formation of committee to determine cane prices according to sugar prices," Verma said, speaking to TOI on Monday.



The Rangarajan Committee appointed by the Central Government, has recommended adoption of either of the following two formulas: a) Cane price should be 70% of the revenue realised from sugar, bagasse, molasses and press mud, or b) Cane price should be 75% of the revenue realised from sugar only (giving 5% weightage to revenue from the first stage by-products).



The committee had said in October last year that the benchmark price fixed by the Centre, called the fair and remunerative price (FRP), be the minimum price for cane purchases. The actual payment for cane dues should be in two steps. The first will be payment of a floor price based on the FRP as per the extant mechanism. The rest of the payment of cane dues will be done subsequent to the publication of half-yearly ex-mill prices on the lines indicated, the committee had said.



The millers have been citing drastic difference between the ex mill sugar prices in comparison to the SAP. According to a UP sugar mill association official, the average ex-mill sugar prices in UP in Oct-Nov, 2012 were Rs.3,500-3,600 per quintal, when these SAPs were fixed. The prices had moved up from July, 2012, but started falling from December, 2012, and have come down to Rs.2,850-2,950 per quintal in October, 2013. In other words, the ex-mill sugar prices in UP have fallen by over 18% in the last 12 months. The average ex-mill price during the 2012-13 sugar season was Rs 3,150 per quintal.



At the above cane price and at an average sugar recovery of 9.2%, the average cost of production of sugar for UP sugar mills was Rs 3,600per quintal. The UPSMA has already informed that due to the fall in sugar prices and the high cost of production in relation to that, the sugar industry in UP lost about Rs 3,000 crore in 2012-13. Consequently, farmers have yet to receive Rs 2,400 crore, out of the total price of sugarcane sold, even in October this year.



Undaunted by the difference, the state government went ahead fixing the same SAP for 2013-14 crushing season: Rs 290 per quintal for early varieties, Rs 280 per quintal for general varieties and Rs 275 per quintal for rejected varieties. This resulted in a raging deadlock between the millers and the state government, with the former unwilling to pay more than Rs 225 per quintal. The controversy assumed violent dimensions with farmers staging protests and demonstration seeking opening of the mills. Various political parties allegedly fueled the protest much to the embarrassment of the state government.



It was only on Sunday when state government partially conceded to the demands of the millers while allowing them to pay SAP in two installments, Rs 260 per quintal immediately and Rs 20 per quintal before the end of present crushing season.

Myanmar Opens Up Sez Project To International Companies

Myanmar is allowing international investors to bid for a mammoth project to develop a special economic zone in its southernmost region following the withdrawal of the sole developer, a Thai company, which had been unable to secure partners for the venture, an official said Monday.



Chairman of the Management Committee of Dawei SEZ Han Sein told a press conference in Yangon that developer Italian-Thai Development Pcl ITD.BK—Thailand's largest construction group—had terminated its work on the project in Myanmar’s Tanintharyi region to make way for international bidders.



“Myanmar Port Authorities (MPA) and Italian-Thai had an agreement in place to work on this project previously,” Han Sein, who is also Myanmar’s deputy minister of Transport, said at the MPA office.



“We ended this [agreement] because we want [to open the project up to] international investment,” he said.



Plans for the Dawei SEZ include a deep-sea port, industrial zone, steel plant, fertilizer plant, coal and natural gas-fired power plant and water supply system.



The SEZ will have a motorway linked to Thailand’s Kanchaburi province, as well as a railroad hub, links to oil and gas pipelines, and electrical cable lines.



The initial phase of the project includes a two-lane road, a small wharf which can accommodate 13,000-20,000 tons of vessel, an industrial zone involving labor intensive industries, a power plant, a residential building, a water supply system and communication lines.



China’s Xinhua news agency quoted Han Sein as saying the work Italian-Thai had already completed would be undergoing a due diligence assessment by international consulting firms and that the company would be permitted to re-tender for the initial phase of the project when bidding opens on Dec. 20.



The tender will open on March 31, 2014 and construction is set to begin on May 15. Construction costs for the project are estimated at around U.S. $8.6 billion.



Han Sein also said that the project area had been reduced to 196 square-kilometers (75.6 square-miles) from 204.5 square-kilometers (79 square-miles) and will be implemented in two phases.



The initial phase will cover around 10 percent of the overall project, which is expected to take five years to complete, Xinhua reported.



Myanmar and Thailand—which agreed two years ago to implement the project on a 50-50 basis—had revoked Italian-Thai’s 75-year concession, citing the company’s failure to secure private investment and to agree on a power source for the SEZ, according to news reports.



The two countries signed a memorandum of understanding (MoU) in Bangkok late last month transferring the concession to Dawei SEZ Development Co. (DSEZ), a new 50-50 special-purpose vehicle set up by the neighboring nations to run the project.



Another MOU obliges new investors to reimburse Italian-Thai for the money it has invested in building roads and other facilities at the site following its due diligence assessment, which is expected to be finished in May.



Reuters news agency had quoted former economist and current Myanmar deputy central bank governor Set Aung as saying that the sidelining of Italian-Thai could allow Japanese industrial and hi-tech firms already established in neighboring Thailand to become involved in the project.



He said that Japanese companies, which are eager to take advantage of investment reforms introduced by President Thein Sein since taking power from Myanmar’s former military junta two years ago, would “most likely announce their intentions” in December, when Dawei is due to be discussed on the sidelines of a regional meeting in Tokyo.



Attracting investors



Observers said that while the decision to take back the concession might frighten off some potential investors in the SEZ, the move will buoy the confidence of others who were concerned by the lack of transparency involved in the original agreement, which was made between Italian-Thai and Myanmar’s former military government in the 1990’s.



"I believe this is a very positive development. Investors will have more confidence dealing with DSEZ and be more positive about investing in the Dawei SEZ with DSEZ as the regulator," Albert Chandler of Chandler and Thong-ek Law Offices Ltd in Bangkok told the Bangkok Post.



He said Italian-Thai will likely be engaged as a contractor by several projects in Dawei.



John Fotiadis, senior member of Bangkok legal firm Atherton Co., said it seems Italian-Thai is negotiating agreeable terms with both governments.



"Given so, we do not believe this will have negative repercussions for foreign investors considering future investment," he told the Post.



"From what we've observed, it seems there are unique circumstances in this case due to the size of the project, changes in the government, changes in international sanctions and internal factor, and they are not necessarily due to Myanmar rules and regulations."



However, some analysts suggested that if the regulatory framework in Myanmar makes the project expensive, difficult, or complicated to comply with, bidders are more likely to opt out.

Source : rfa.org

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