Today's Hot Stories - April 03, 2013
10 Headlines for Today(1) Sonia-Manmohan model valid for future: Congress
(2) Lokayukta: Gujarat Bill ending role of Governor, CJ passed
(3) Malaysia PM dissolves parliament, paves way for elections
(4) No relief for Mallya, Bombay HC lets banks sell UB Group shares
(5) Textiles Ministry wants extension of interest subvention scheme
(6) Asian stocks up after positive US economic data
(7) Williams makes transition to clay with win
(8) Carlsen to challenge Anand for World title
(9) Confident of making a fresh start with Kings XI: Grewal
(10) Film actors fast for Sri Lankan cause
5 Stories for Today
(1) Govt will take decisive action to push growth to 8%: PM
(2) U.N. passes historic arms trade treaty
(3) ITC’s entry into packaged namkeens may trigger another food war
(4) Apple apologises to China after service criticism
(5) Growth in pvt sector output slowest since October 2011: HSBC
(1) Govt will take decisive action to push growth to 8%: PM
Prime Minister Manmohan Singh has said that the government is willing to do everything to bring the economy back on the path of high growth.
The government and the industry have to be partners in India's growth story, Manmohan Singh told top business leaders at the opening of Confederation of Indian Industry 's annual general meeting here on Wednesday.
Prime minister expressed disappointment at the slowing of growth, but said this is not permanent.
"Growth has slowed to 5 per cent, which is clearly disappointing... We are seeing temporary downturn, partly due to global factors. We can get back to 8 per cent growth rate," Singh said, adding, government will take speedy and decisive action to push growth.
I don't believe that our future is at 5 per cent growth, the PM said expressing hope that the country can get back to high growth rate.
"We will prove the prophet of doom wrong," Manmohan Singh said, adding, "If the business mood was unduly optimistic in 2007, I think it is unduly pessimistic today."
He stressed the need to contain fiscal deficit.
We are determined to do everything possible to achieve the fiscal deficit roadmap, Manmohan Singh said.
As per the road map, the government aims to bring down the fiscal deficit to 3 per cent of GDP by 2016-17.
As regards the current account deficit (CAD), he expressed hope that it would moderate in the current financial year from a high of 5 per cent recorded in 2012-13.
Manmohan Singh said that the govt is reviewing the FDI policy comprehensively.
Decline in private sector investment must be reversed. I am encouraged by progress made by the Cabinet Committee on Investment, he said.
The Prime Minister accepted that corruption and administrative inertia were problems and managing a coalition was not easy.
"Corruption is a problem. Bureaucratic inertia is a problem. Managing coalition is not easy. But these problems have not arisen suddenly. They were all there even earlier when the economy was growing at 8 per cent", Singh added.
Source: The Times of India
(2) U.N. passes historic arms trade treaty
The U.N. made history on Tuesday when it passed an unprecedented arms trade treaty (ATT) to better regulate the international sale in weapons.
It was passed in the General Assembly with 154 members voting ‘Yes’; three — Iran, Syria and North Korea — voting no; and 23, including India, abstaining.
The treaty’s passage came after negotiations failed last July when the U.S. pulled out abruptly.
Its adoption implies a major step forward in controlling the $70-billion flow of arms across borders, particularly restricting its movement to and from areas where groups are suspected of violation of human rights.
In addition to India, the nations that abstained included China, Egypt, Myanmar, Russia, Saudi Arabia and Sri Lanka. Pakistan voted in favour of the treaty though its representative expressed concerns over the imbalance in obligations between arms exporters and importers.
India’s stance
Speaking after the vote, Sujata Mehta, India’s Permanent representative to the Geneva Conference of Disarmament during the UNGA session, said “At this stage we are not in a position to endorse the text contained as annexure to document. Therefore, India has abstained on the resolution”.
In particular Ms. Mehta said that the draft treaty text “falls short of our expectations and a number of other key stakeholders in producing a text that is clear, balanced and implementable and able to attract universal adherence”.
She reiterated her earlier message, noting India’s keenness to include language on illicit trafficking and use of conventional arms by “terrorists and other unauthorised and unlawful non-State actors”.
Under the ATT, ratifying nations are expected to accept fixed international standards for conventional weapons sales, linked to the protection of human rights. The adopted treaty text covers weapons such as tanks, armoured combat vehicles, large-calibre artillery systems, combat aircraft, attack helicopters, warships, missiles and missile launchers, and small and light arms
However it does not explicitly cover predator drones and grenades.
Ammunition exports are subject to the same criteria as the other included items, although its imports are not covered.
Ms. Mehta underscored Indian desire for the treaty to impose a fair balance of responsibilities on exporting and importing states. For the past few years, India has been the world’s largest arms importer.
“India cannot accept that the Treaty be used as an instrument in the hands of exporting states to take unilateral force majeure measures against importing states parties without consequences,” Ms. Mehta noted in this regard.
‘A welcome move’
Human rights organisations welcomed the treaty’s adoption.
“The world has been waiting a long time for this historic treaty. After long years of campaigning, most states have agreed to adopt a global treaty that can prevent the flow of arms into countries where they will be used to commit atrocities,” said Brian Wood, Head of Arms Control and Human Rights at Amnesty International, from the conference in New York.
Earlier, the U.S. appeared ominously close to again playing a spoiler role as it did during 2012 treaty negotiations after Senate Republicans recently passed an amendment, by a 53-46 vote, against U.S. ratification of the treaty, purportedly to uphold the Second Amendment.
The influential National Rifle Association has also “vowed” to block the Senate’s ratification of the ATT.
U.S. officials have generally downplayed the possibility of any deleterious impact of the treaty on the U.S. share of the arms trade business, which is close to 30 per cent.
In comments quoted by The New York Times, Thomas Countryman, Assistant Secretary of State leading the American delegation to the talks, said that more states will impose controls on their own legal exports and the treaty demands more effective action against black market arms brokers and the diversion of weapons.
“This treaty will bring much of the rest of the world not up to the American standards but much closer to the American standards,” he said. “In that sense, I believe it levels the playing field and gives American manufacturers a better competitive position in the world.”
Source: The Hindu
(3) ITC’s entry into packaged namkeens may trigger another food war
In a move that could make packaged namkeens the next big food fight, ITC is planning to enter this segment, while Parle Products and CavinKare are relaunching their portfolios, and setting higher sales targets to give regional brands like Haldiram's, Balaji and Bikaji stiff competition. According to four senior industry officials, ITC will launch a major foray in the next couple of months.
It is likely to enter Gujarat, Maharasthra and Rajasthan first, before taking the portfolio national. An official of a competing branded namkeen maker said ITC has been picking up samples of rival brands for the last few months.
"They have also sounded some of the top distributors and retailers about their namkeen foray. The company may even enter the namkeen segment under a new brand and not Bingo!," he said, requesting anonymity. When contacted, an ITC spokesperson declined to comment.
ITC's snacking brand Bingo! is the fastest growing brand in the packaged food business with a growth rate upwards of 30%, and it is currently the second-largest wafer brand in India after PepsiCo's Lay's. PepsiCo was the first big food company to take on the regional namkeen players with its Lehar brand, while its flagship Lay's focuses more on the western snack space.
Lehar is growing faster than Lay's, which has encouraged PepsiCo to expand its portfolio of 50 SKUs and distribution points. A PepsiCo India spokesperson said the company has adopted a different business model for Lehar including distributed manufacturing, a lean organisation and indirect distribution through wholesalers with higher incentives for retailers to keep price points affordable and enhance speed-to-market.
India's largest biscuit maker Parle Products has focused on improving the bottom line of its snacking business in the last year, and is now re-launching and expanding its portfolio with plans to make it the second-largest business after biscuits, ahead of confectionery.
"We are aiming for 25% growth in namkeens, which will also help us to fight bleak consumer demand, since both biscuits and confectionery categories are growing at a tad smaller pace of 10%," says Parle Products group product manager BK Rao. Parle plans to expand its distribution from towns with population of over five lakh to towns with over one lakh population. Going by Nielsen data, branded namkeens accounted for 52% of the total salty snack sales market, which was worth about Rs 9,400 crore last June.
Source: The Economic Times
(4) Apple apologises to China after service criticism
Apple apologised to Chinese consumers after government media attacked its repair policies for two weeks in a campaign that reeked of economic nationalism.
A statement Apple posted in Chinese on its website on Monday said the complaints had prompted "deep reflection" and persuaded
the company of the need to revamp its repair policies, boost communication with Chinese consumers and strengthen oversight of authorised resellers.
State broadcaster CCTV and the ruling party's flagship newspaper, People's Daily, had led the charge against the iconic American company.
They accused Apple of arrogance, greed and "throwing its weight around" and portrayed it as just the latest Western company to exploit the Chinese consumer.
The attacks quickly backfired, though, and were mocked by the increasingly sophisticated Chinese consumers who revere Apple and its products.
State-run media also inadvertently revived complaints over shoddy service by Chinese companies.
Nonetheless, Apple responded with an apology from CEO Tim Cook.
"We've come to understand through this process that because of our poor communication, some have come to feel that Apple's attitude is arrogant and that we don't care about or value feedback from the consumer," Cook's Chinese statement said, as translated by The Associated Press. "For the concerns and misunderstandings passed on to the consumer, we express our sincere apologies."
Apple CEO Tim Cook speaks during Apple's special event at the California Theatre in San Jose in California. AFP
Although Apple enjoys strong support from Chinese consumers, the vehemence of the attacks and the importance of the Chinese market appeared to have persuaded the company to smooth its relations with Chinese consumers and authorities.
The People's Daily newspaper ran an editorial last Wednesday headlined "Strike down Apple's incomparable arrogance." More: China orders stepped-up scrutiny on Apple
"Here we have the Western person's sense of superiority making mischief," the newspaper wrote. "If there's no risk in offending the Chinese consumer, and it also makes for lower overheads, then why not?"
Chinese observers accused People's Daily of gross hypocrisy and pointed out that the newspaper had maintained a stony silence when Chinese companies were implicated over food safety, pollution and other scandals.
Meanwhile, CCTV was shamed when it emerged that celebrities had been recruited to blast the company on Weibo, China's version of Twitter, in what had been billed as a grassroots campaign. More: Popularity helps buffer Apple from Chinese state-media attacks
A man leaves an Apple store with an iPhone and an iPad in his hands in central Beijing, China. Apple apologised to Chinese consumers after government media attacked its repair policies for two weeks in a campaign that reeked of economic nationalism. AP/Alexander F Yuan
"The public responded in two ways to this incident," popular commentator Shi Shusi wrote on his Weibo account.
"One group supports this criticism but quite a number of people felt that there are state monopolies which have severely violated customer's rights, but which are not being exposed."
Popular business magazine Caijing said its readers identified a long list of abusers, including state banks that lend to those with political connections while stiffing ordinary savers with low rates on deposits; a government oil company that sets gas prices and other rates as it sees fit; and state telecom providers notorious for their lack of customer service.
"If media is going to go after Apple, let's hope they spare some thought for those big Chinese communications companies and other monopolies, the ones that enrich special interests in the name of being publicly owned," Cai Tongqi, a lawyer from the eastern province of Jiangsu, wrote on Weibo.
Consumers thus far seem unfazed by the state media's attacks on Apple Inc.
Perusing the wares at an Apple reseller in Beijing's tony China World mall, recent college graduate Zeng Lu said she considered the controversy a sign of the Chinese consumer's growing maturity.
"It's great to see Chinese consumers standing up for their rights, but it's ridiculous for the People's Daily to get involved," Zeng said. "They should be criticizing state companies instead."
Apple's popularity flies in the face of China's ardent attempts to push its own brands and develop internationally competitive companies.
The company also has resisted trends to enter joint ventures and move research and development to China. It also ignores big state media such as CCTV and People's Daily. Apple relies on Chinese factories, though, to make iPads, iPhones and other popular products.
Tourists walk past an Apple store on the busy Wangfujing shopping street in Beijing.
Despite the government's pressures, sales of Apple products in the region, which includes Taiwan and Hong Kong, grew 67 percent to $6.8 billion in the first three months of 2013, compared with the same period a year earlier, according to the company. Apple sold 2 million iPhone 5s during the first weekend it was available in China, in December.
The region is Apple's third largest market, accounting for 13% of all sales last year. More than 17,000 outlets sell its products in mainland China, a figure that includes 11 Apple stores and 400 premium resellers.
In January, Cook said he expects China to replace North America as its largest source of revenue in the foreseeable future.
The attacks on Apple center on complaints over Apple's repair policies in China - specifically its practice of only replacing faulty parts rather than providing new iPhones, as it does in other markets.
Critics say that allows Apple to avoid having to extend its service warranty by another year. Until Monday, the Cupertino, California-based company had kept silent apart from issuing a statement March 23 explaining its repair policy and pledging its deep respect for the Chinese consumer.
Yet consumers and analysts say the complaints hardly justify Beijing's campaign of vilification.
Such nationalist outbursts are not uncommon, although previous campaigns against foreign companies have often been tied to perceived national slights, as often befalls Japanese firms.
Beijing accused Google of being an arm of American "information imperialism" after the company announced in March 2010 that it would cease censoring its search responses inside mainland China and instead send visitors to its uncensored search engine in Hong Kong.
Beijing is also angry over Washington's efforts to exclude Chinese high-tech firms including Huawei Technologies Ltd. and ZTE Corp. from the U.S. market, amid worries over security.
A spending bill signed by President Barack Obama two weeks ago includes a clause barring NASA, the National Science Foundation and the Justice and Commerce Departments from contracting with firms tied to the Chinese government.
Washington and Beijing have also sparred over more recent hacking attacks, including a highly influential report by cybersecurity firm Mandiant that tied Chinese hacking to a unit of the People's Liberation Army based in Shanghai.
Apple, however, may have been singled out simply because it is "the biggest open target," said Jim McGregor, senior counselor at consultancy APCO Worldwide.
"We're still seeing a lot of things wrapped up in economic nationalism," McGregor said.
Even before Monday's apology, he had predicted Apple would make some sort of show of contrition to get its relations with the Chinese authorities back on track.
Duncan Clark, managing director of BDA China Ltd, a Beijing research firm, said the assault probably stems from a combination of factors, including the failure of Chinese companies to make breakthroughs in high-end consumer electronics.
"There's a general sense of frustration that China can't move further up the value chain," Clark said.
Source: Hindustan Times
(5) Growth in pvt sector output slowest since October 2011: HSBC
The country's private sector output for the month of March witnessed the slowest rate of expansion in 17 months owing to a significant decline in new business orders, an HSBC survey said today.
The HSBC India Composite Output Index -- which maps both the manufacturing and services index -- fell to 51.4 in March from 54.8 in February indicating business activity increased only slightly, and at the slowest pace since October 2011.
Output growth eased across both the manufacturing and service sectors but index remained above the 50 mark below which it indicates contraction.
Meanwhile, the headline HSBC Services Business Activity Index registered 51.4 in March, down from 54.2 in February.
"Growth in service sector activity slowed notably due to a deceleration in new business flows," HSBC Chief Economist for India & ASEAN Leif Eskesen said adding that the backlogs of work and hiring rose at a slower pace.
Earlier data showed that India's manufacturing sector also witnessed the slowest rate of expansion in 16 months in March as power outages hampered production activity along with decline in new business orders.
Service sector firms as well as manufacturers added to their staff numbers during March, but the rate of job creation was "moderate".
After registering a 12 month high in January, the country's services sector has reported weak output for the last two months. However service providers remain optimistic about the future.
The degree of confidence among service providers was the strongest registered since December 2012 and service sector firms linked positive sentiment to expectations of stronger demand and planned investment in marketing, HSBC said. On inflation, the report said input prices in the Indian service sector rose but moderately during March and subsequently, services companies increased their selling prices.
"Encouragingly, input prices and prices charged inflated less fast. Despite this the scope for further rate cuts is limited, and the next cut may well be the last," Eskesen said.
The Reserve Bank in its mid-quarter monetary policy review on March 18 reduced the indicative policy rate (repo rate) by 25 basis points from 7.75 to 7.50 per cent.
Repo rate is the rate at which banks borrow short-term funds from the central bank.
India's GDP growth in the third quarter of 2012-13 stood at 4.5 per cent, the weakest in the last 15 quarters.
Source: The Indian Express
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