Store Our Oil And Take Two-Thirds For Free: Uae's Offer To India

The United Arab Emirates' national oil company - Abu Dhabi National Oil Company (ADNOC) - has in the first deal of its kind agreed to store crude oil in India's maiden strategic storage and give two-third of the commodity to it for free.

India, which is 79 per cent dependent on imports to meet its crude oil needs, is building underground storage facilities at Visakhapatnam in Andhra Pradesh, and Mangalore and Padur in Karnataka to store about 5.33 million tonnes of crude oil to guard against global price shocks and supply disruptions.

Adnoc is keen on taking half of the 1.5 million tonnes Mangalore facility, Oil Minister Dharmendra Pradhan said on Wednesday.

It will stock 0.75 million tonnes or 6 million barrels of oil in one compartment of Mangalore facility. Of this, 0.5 million tonnes will belong to India and it can use it in emergencies. Adnoc will use the facility as a warehouse for trading its oil.

The 1.33 million tonnes Visakhapatnam storage and 2.5 million tonnes Padur stockpile together with the 1.5 million tonnes Mangalore storage will be enough to meet nation's oil requirement of about 10 days.

After talks with visiting UAE Minister for Energy Suhail Mohammed Al Mazrouei, Mr Pradhan said the tax issue remains to be sorted out before Adnoc can begin storing oil at Mangalore.

Congress-ruled Karnataka government has not yet agreed on waiving VAT (value-added tax) on the crude oil imported for the strategic storage, which UAE wants to use to stock oil when prices are low and supply to its customers when rates are good.

"This will be beginning of our strategic ties," he said, adding that Prime Minister Narendra Modi's visit to UAE in August last year, the first by an Indian Prime Minister in 38 years, laid the foundation of closer cooperation.

The UAE had then committed to invest $75 billion in India, and Mr Pradhan on Wednesday showcased to Mr Mazrouei opportunities for that investment.

"We have offered them refinery projects, petrochemical plans, pipelines and LNG terminals for investment," he said.

On offer was 26 per cent stake for $700 million in ONGC's about-to-be-commissioned petrochemical project at Dahej in Gujarat and 24 per cent equity for $200 million in expansion being planned by BPCL of its subsidiary Bina refinery in Madhya Pradesh from 6 million tons to 7.5 million tonnes.

Also, an investment of $530-850 million can get the UAE 25-40 per cent stake in HPCL's planned petrochemical plant on the Andhra coast, he said, adding that the Gulf national can also invest in the planned 60 million tons in Maharashtra and the Jagdishpur-Haldia and Paradip-Surat gas pipelines.

"UEA makes up for 8 per cent of our oil imports. We are trying to import more oil from UAE. In 2016-17, we plan to import 2.5 million tonnes more oil than current year's purchase of 16.11 million tonnes," he said.

Mr Pradhan said areas of mutual interest were discussed during his meeting with UAE Energy Minister.

Indian firms are not present in upstream oil exploration and production business in the UAE, he said, and mentioned the interest of companies like ONGC Videsh Ltd (OVL) to secure producing or prospective assets there.

Also, they are interested in taking stake in Abu Dhabi Company for Onshore Petroleum Operations Ltd (ADCO), he said, adding that Engineers India Ltd (EIL) was interested in engineering and consultancy contracts in UAE.

"We also offered them partnership in building of second phase of strategic crude oil storages," he said.

India is looking at building four more strategic crude oil facilities at Bikaner in Rajasthan, Rajkot in Gujarat, Padur in Karnataka and Chandikhole in Jajpur district of Odisha.

Besides Adnoc, Kuwait Petroleum Corp (KPC) has also evinced interest in hiring a part of the maiden strategic storage.

Source:- profit.ndtv.com

Need To Withdraw Duty On Import Of Used Cooking Oil To Be Used As Bio-Diesel: Nitin Gadkari

Union minister for road transport, highways and shipping Nitin Gadkari at an event said that the government is mulling to withdraw duties imposed on import of used cooking oil to be used as an alternate, cheap fuel for transportation.

Addressing an ASSOCHAM event in New Delhi, Gadkari said that the Govt intents to build smart cities at 10 major ports; needs to construct houses worth less than Rs. five lakh to promote low-cost housing for poor

“I have requested Commerce and Industry Minister, Nirmala Sitharaman to withdraw duties on import of fried oil which is often discarded as waste after being used once and is available in abundance across the world,” said Gadkari while addressing a global summit on ‘Smart Cities-Smart India,’ organised by The Associated Chambers of Commerce and Industry of India (ASSOCHAM).

“If that oil comes in our country it will help in making bio-diesel and its cost is about Rs. 3-4 per litre cheaper than petroleum diesel and when we will withdraw duties imposed on the same its price will come down by another Rs 6-7/litre,” said Gadkari.

“The average is almost the same and it will help reduce pollution, so we are encouraging use of bio-diesel,” he added.

Highlighting the importance of promoting low-cost housing across India, Gadkari “The biggest stumbling block is that only about one per cent of people in India can purchase house costing above Rs. 10 lakh, so if we are able to make houses worth less than Rs. five lakh about 30 percent of people would be able to buy those houses which will help us build smart cities and provide housing to poor,” said the union minister.

Talking about use of waste material in constructing low-cost houses, Gadkari said, “Conversion of waste into wealth will be promoted and it will prove to beneficial.”

The union minister also said that central government will build one smart city each at 10 out of country’s 12 major ports, union minister for road transport, highways and shipping.

“Apart from our ports at Mumbai and Kolkata, we have planned to develop smart cities at 10 out of 12 major ports in India,” said Gadkari.

He also said that in the times ahead, use of electric cars and buses would be promoted for transportation in smart cities to reduce air pollution, besides it is very cost effective.

He also informed that government is constructing waterways on a 1,620 kilometer stretch on Ganga between Varanasi and Haldia.

“Varanasi, Haldia and Sahibganj will be developed as multi-modal hubs with roadways, waterways and railways. For this, we have acquired land, our designs are ready, we have given work order for all three places, so before March we will begin work,” said Gadkari.

He also informed that government had initiated river traffic control system from Haldia to Farakka and it will initiate in next six months from Farakka to Patna and thereafter from Patna to Varanasi.

The union minister further informed that government will start RO-RO (Roll-on Roll-off) service at five places - Haldia, Patna, Varanasi, Sahibganj and one more place needs to be selected.

Source:- http://ift.tt/JUEAQD

Gold Imports Up In 2015, Demand Stagnant

 India has seen a surge in gold demand in second half of 2015 but overall the year ended with total demand remaining stagnant. According to the report of gold demand trend for Q4 of 2015 and full year report released today. India's total demand for gold in 2015 was 848.9 tonnes compared to 842.7 tonnes in 2014. In value terms however due to lower price import bill has not seen any significant increase. It was around $35 billion.

In the calendar year ended December 2015, second half has seen a sharp surge in demand due to lower prices with total demand at 502.3 tonnes. However against this as per WGC data, total net bullion imports was 897.5 tonnes which was 769 tonnes in 2014. The rising import at a time when demand is stagnant represents some inventory with jewellers and fall in unofficial imports.

The demand trend report for 2015 released today also says that in the year China remained top gold consuming country keeping India second. China's total demand was 984. 5 tonnes against 813.6 tonnes in previous year. Traditionally India had been a top gold consumer but in 2013 and 2015 China remained at the tope while in 2014 India was number one consumer. In 2015 following depreciating currency in China especially in second half and crashing stocks consumers preferred to move back to gold.

Globally total gold demand in 2015 was virtually flat compared to 2014 at 4,212 tonnes said the council. Despite a challenging start to the year, gold demand rebounded in the second half of 2015 as a result of sustained buying from central banks and a strong second half from China and India.

This was particularly evident in the retail investment, where bar and coin purchases were led by China and Europe, with strong support from the US, as investors took advantage of weaker prices amid a softening economic backdrop, financial turbulence and ongoing geopolitical tension.

Global investment demand for the full year 2015 grew by 8% to 878 tonnes.

Overall jewellery demand for the full year 2015 was down 3% to 2,415 tonnes. Following a slower start to the year, "the third and fourth quarters combined produced the strongest second half-year total for gold jewellery in 11 years," said the report.

Central Bank demand for the full year 2015 saw a small uptick of 4 tonnes in 2015 to 588 tonnes as the need for further diversification was reinforced by a tumbling oil price and reduced confidence in the global economy. Central banks demand recovered in december quarter. It went up 25% to 167 tonnes, making this the 20th consecutive quarter of net purchasing.

Alistair Hewitt, Head of Market Intelligence at the World Gold Council, said, "Looking ahead, physical demand will continue to be supported by strong central bank purchases, and continued buying of jewellery, bars and coins by households across the world, led by India and China. If we just look at the year to date, the investment case for gold is as strong as ever. While stock markets have wobbled, gold has performed well."

Total supply for the year experienced a drop of 4% to 4,258 tonnes due to lower recycling supply and most importantly mine production growth falling to its lowest level since 2008. Mine production contracted in Q4, the first quarterly contraction since 2008, as cost cutting took effect. In december quarter it substantially declined by 10% to 1,037t as primary production slowed as a result of weaker gold prices, mine closures and project delays.

Source:- http://ift.tt/15HW3lL

Understanding India’S Export Predicament

India’s commodity exports fell by 18.4 percentage points year-on-year during April-December 2015. In percentage terms, this is the worst fall in export values since 2001, and around 5 percentage points more than the previous high of 13.8 percentage points in April-December 2009.

It might be tempting to put the entire blame for the fall in exports on the sluggish global economic scenario. However, it is also a fact that India’s performance on the external trade front has been found wanting even during better times. Here are some facts which can help understand India’s export predicament during the post-reform period.

India’s pre-liberalization growth strategy was criticized by many on the ground that it stifled exports. It was argued that opening up the economy would open up avenues for increased exports and hence more earnings for the economy. Exports did increase at a faster rate in the post-reform period. Annual percentage growth of exports (in dollar terms) was 37.7% between 1955-56 and 1990-91. It went up to 70.4% between 1991-92 and 2014-15. However, these gains were more than neutralized by a much faster growth in imports. Annual percentage growth of imports (in dollar terms) was 38.4% and 95.1% for the two periods, respectively. As a result, there has been a significant increase in the percentage share of trade deficit to GDP for India. Prior to the reform period, the highest level of five-year moving average of trade deficit as a percentage of GDP was just above 3%. This figure has continued to increase and reached an all-time high of 9% a couple of years ago.

Source:- livemint.com

Rupee Hits Fresh 29-Month Low Against Us Dollar

The Indian rupee on Thursday hit fresh 29-month low against the US dollar after local equity markets fell over 800 points.

At 3.58pm, the home currency was trading at 68.31 per US dollar, down 0.66% from its previous close of 67.86. The local currency opened at 67.95 a dollar and touched a low of 68.31—a level last seen on 4 September 2013.

The Sensex index fell 3.4%, or 807.07 points, to 22,951.83. This was the fourth consecutive session when the index closed lower. Since 5 February till date, the index has fallen 6.82%. So far this year the index is down 12.17%.

Traders are also cautious ahead of the Index of Industrial Production (IIP) and Consumer Price Index (CPI)-based data due on 12 February after 5.30pm. According to Bloomberg estimates, IIP will be at zero for December as compared with -3.2% in November. CPI will be at 5.4% in January from 5.61% a month ago.

“Our equity markets are tanking and that’s getting reflected in the currency’s movement,” Bloomberg report said, quoting Gaurav Sharma, a senior currency analyst at Religare Commodities Ltd in Noida. “The rupee will chart its own course once the sell-off abates,” he said.

The yield on India’s 10-year benchmark bond was trading at 7.722% against Wednesday’s close of 7.817%. Bond yields and prices move in opposite directions.

Since the beginning of this year, the rupee has lost 3.05%, the worst performing currency in Asia, while foreign institutional investors have sold $1.89 billion from local equity and bought $444.10 million in bond markets.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 95.787, down 0.11% from the previous close of 95.888.

Asian currencies were trading mixed. Japanese yen was up 1.8%, Taiwan dollar 0.4%, China offshore 0.23%, Thai baht 0.16%, Indonesian rupiah 0.1%, Singapore dollar and Hong Kong dollar rose 0.08%. However, Malaysian ringgit was down 0.47%, South Korean won 0.35%, Indonesian rupiah 0.1%, Philippines peso and China renminbi declined 0.08%.

Source:- livemint.com