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BW Businessworld

As The Going Gets Tough

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It's hard times again. With inflation rearing its head, widening fiscal and current account deficit splunging the rupee to unprecedented lows and the stock markets getting spooked by the euro zone crisis, the government is planning to administer some bitterpills. Replying to a debate on the Finance Bill in Parliament, finance minister Pranab Mukherjee indicated the government's intention to resort to some"austerity measures" soon. Mukherjee, however, did not elaborate on the plan. It was in September 2009 that thegovernment had last initiated such measures. Analysts say that the finance minister's announcement signals that the economy is not going to get back the desired momentum any time soon.

Broadband Buyout
Telecom major Bharti Airtel is said to be in talks with Qualcomm India to buy its mobile broadband licence. Qualcomm has reportedly quoted a price of Rs 5,000 crore. Qualcomm holds licences for Mumbai, Delhi, Haryana and Kerala, which it bought in 2010 for Rs 4,900 crore. Bharti may purchase the unit over two years. It would initially buy a 26 per cent stake in Qualcomm India and Qualcomm will own 51 per cent of the division for at least two years after that, say reports. 


SALES DIP: India's demand for gold fell in Q1 FY2012

Losing Sheen
Data from the World Gold Council shows India — one of the strongest gold markets in the world — has lost its prime position to China, where gold demand rose by 9 per cent from a year ago to 255.2 tonne in the first quarter of 2012. India's total gold demand was down 29 per cent at 207.6 tonne during this period. 

Lower Gear
Bajaj Auto's net profit declined 45 per cent year on year for the quarter ended 31 March 2012; it fell from Rs 1,400 crore to Rs 772 crore. Bajaj says the Rs 1,400 crore profit a year ago was mainly due to the Rs 800 crore gain from the prepayment of debt. That said, the auto major's total income increased 11 per cent to Rs 4,791 crore from Rs 4,301 crore a year ago. 

Recharge Time
Despite the tax row, telecom major Vodafone is bullish on India. It is planning to list its Indian arm on the country's bourses, according to chief executive Marten Pieters. In April 2011, Vodafone Group CEO Vittorio Colao told media that an initial public offering for Vodafone India could beon the cards. Standing FirmTelecom regulator Trai has stuck to its recommended base price for 2G spectrum auction at Rs 3,622 crore per MHz in the 1800 MHz band. Telcos had said Trai's recommendations would jeopardise the sector and force them to raise tariffs 30-40 per cent. 

High On Hardware
Research firm Gartner says India's information technology infrastructure market, which includes servers, storage and networking equipment, will touch $3 billion by 2016. The market is likely to hit $2 billion in 2012, a 10.3 per cent increase over 2011. Revenues from servers, the largest segment of the Indian IT infrastructure market, will hit $754.5 million in 2012, and grow to $967.2 million in 2016.

Curbs On Insurers

SINGLE STOP: Google takes search to the next level

Insurance regulator Irda has asked life insurers to stop selling highest net asset value (NAV)-guaranteed products, which contribute 20 per cent to their total premium collection. Highest NAV-guaranteed products are those that promise to pay the highest value the fund achieves during a certain period, say, five or seven years. 

Smarter Search
Google has announced a major revamp of its web dominating search engine just days after rival Microsoft's Bing service announced upgrades. The Knowledge Graph will be Google's latest attempt to provide direct answers in its results instead of just sending people elsewhere.

Textile Trauma
In the past eight years, 215 cotton or man-made fibre textiles mills, which employed 69,774 workers, have been shut down in the country, says textiles minister Anand Sharma. 

(This story was published in Businessworld Issue Dated 28-05-2012)