Friday, August 17, 2012

A different view of Indian growth from PMEAC

Prime Minister’s Economic Advisory Council(PMEAC) forecasts a better growth number compared to different rating agencies. “Economy will grow at 6.7 per cent in 2012-13,” PMEAC Chairman C. Rangarajan said while releasing ‘The Economic Outlook for 2012-13’. Reserve Bank of India (RBI)'s growth target now stands at 6.5 per cent from 7.3 per cent estimated earlier.
This comes when other rating agencies like Crisil and Moody’s projecting a growth rate of 5.5 per cent.
PMEAC Chairman suggested the government should allow FDI in more sectors to improve the economy.

CAG revises coalgate loss

The Comptroller and Auditor General's(CAG) report on coal, power and Delhi airport tabled on parliament. According to the revised CAG report on  non-transparent allocation of coal blocks revised down the estimate of loss  to Rs 1.86 lakh crore from Rs 10.67 lakh crore earlier. The reduction is based on the exclusion of allocation to government companies in the report. The 25 companies which are in the report include Hindalco, Tata Power, Jindal steel and Power, Essar Power and Tata steel.
The loss occurred because of the delay in introduction of the process of competitive bidding instead of allocation.  

SEBI announce measures to improve retail participation

Securities and Exchange Board of India(SEBI) chairman U.K. Sinha announced measures to revamp the capital market by wider participation of retail investors in the Initial Public Offering (IPO) and mutual fund industry, including steps to improve the geographical reach of mutual funds and introducing electronic-IPO. SEBI allows  cash transactions in mutual funds up to Rs. 20,000 to help enhance the reach of mutual fund products among small investors, who may not be tax payers and may not have PAN or bank accounts. This move will benefit farmers, small traders/businessmen and workers. 
Electronic-IPO is introduced to attract more investors. Applications Supported by Blocked Amount(ASBA) is available with this mode. To facilitate this SEBI allows a nation wide network of brokers of stock exchanges at more than 1,000 locations in addition to the existing channels, for distributing IPOs in electronic form. 

What is ASBA?
ASBA is a facility in which applicants are allowed to apply in IPOs with the money in their accounts which will remain blocked until the issue gets completed. If he gets allotment the money will be transferred for IPO otherwise the money will be released.

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