Sunday, October 31, 2010

10 More Days to Go !

DoT to Launch Countrywide MNP on November 25 from Haryana Service Area

The Department of Telecommunications (DoT), Ministry of Communications and Information Technology had earlier announced that Mobile Number Portability (MNP) will be made available to the telephone users from November 1, 2010. This required up-gradation in the network and various other resources of the Telecom Service Providers.

The networks are now technically ready for launch of service. To facilitate an orderly and reliable introduction of MNP services, a suitable migration plan has been evolved in consultation with Mobile Service Providers (MSPs).

DoT now announces that the countrywide launch of MNP services will start from Haryana Licensed Service Area on November 25, 2010. From this date customers in Haryana will have the option of changing their service provider without changing their mobile numbers. Customers wishing to exercise the option of changing their service provider without change of number will have to send an SMS from their phone to 1900. Based on this they will get a unique porting code as SMS from the existing service provider. The customer can then make an application in the prescribed form mentioning the code to the selected new service provider for porting of number. A period of 4 days has been prescribed for completion of porting (transfer) of the mobile number to the network of the new service provider.

The Mobile network in the country is growing rapidly and currently there are over 650 million customers. This customer base is supported by a large and complex network carrying billions of minutes of traffic per day. Hence, it is necessary to carefully test the capability of the networks of all operators and extend the facility in a suitably phased manner to all service areas in the country.

Accordingly, MNP service in rest of the service areas across the country will be implemented after the launch in Haryana in a phased manner. A detailed schedule for other service areas will be announced separately.

Saturday, October 30, 2010

Railways to Sign MoU with NTPC for Joint Venture Captive Power Plant at Adra in West Bengal Tomorrow

In a major initiative, the Ministry of Railways takes a step forward in augmenting its own internal power generation to meet its electricity requirements when it is going to sign an Memorandum of Understanding (MoU) with National Thermal Power Corporation (NTPC), a PSU under the Ministry of Power, Government of India for a Joint Venture captive power plant at Adra in West Bengal on tomorrow i.e. 31st October 2010. The Adra power plant will have capacity of 1320 MW (2 units of 660 MW, super critical units). This power plant will employ super critical technology which is more environment friendly. The MoU will be signed at a function to be held at Anara near Adra (Purulia District, West Bengal) between the Railways and NTPC in the presence of the Union Minister of Railways, Mamata Banerjee.

The Minister of States for Rural Development Shri Sisir Kumar Adhikari, Government of India and the Minister of State for Shipping, Government of India, Shri Mukul Roy will also be present on the occasion. Especially present on the occasion among others will be, Member Electrical Railway Board Shri Sudesh Kumar, Member Mechanical, Railway Board, Shri Sanjiv Handa, Member Engineering, Railways Board and General Manager, South Eastern Railway, Shri A.P.Mishra and Chairman cum Managing Director, NTPC, Shri Arup Roy Choudhury.

In the same function, the Minister of Railways, Mamata Banerjee will also lay the foundation stone for Coach Mid-Life Rehabilitation (MLR) workshop. This will be the second such factory in the Indian Railways after Bhopal. Mid-Life Rehabilitation of coaches breathes life into old coaches and contributes immensely to improve not only their residual service life but also rejuvenate the interiors. The workshop’s output will result in greater availability of coaches.

The peak power requirement of Railways at present is about 3500 MW and likely to go upto 4500 MW by the end of XII year plant. Railways draws its power from state distribution utilities. Railways own captive power plant will help provide power in a more reliable, cost effective, uninterrupted and at economical manner. The electricity generated by Railways’ own plants will turn out to be cheaper than the power provided by state electricity boards to Railways.

Earlier, Railways and NTPC jointly set up 1000 MW thermal power plant at Nabinagar in Bihar which is presently under implementation stage. In addition, Railways has already made operational a 10.5 MW Wind Energy plant at Tirunelveli in Tamil Nadu.
Delhi International Renewable Energy Conference 2010 Concludes 

Delhi International Renewable Energy Conference (DIREC) 2010 concludes here today, with the participation of ministers, energy experts and government representatives of 71 countries, with an aim of up-scaling and mainstreaming renewable for energy security, climate change and economic development . The conference outlined the need for global leadership to ensure that the potential of renewable technologies are realized, dependence on fossil fuels is reduced and energy needs of countries across the globe are met at affordable rates. Fourth in the series, DIREC 2010 was successful in promoting the campaign on renewable energy to the next level – ‘demystifying renewable energy for common man’s usage’.

Dr Farooq Abdullah, Union Minister for New and Renewable Energy, in his concluding remarks thanked all the participants and reiterated that “we need to work together to have a better world. Copenhagen didn’t come up to my expectations. I have great expectations in this conference held at Delhi. Now we have hope in Cancun because it is essential that if we don’t save this world, we won’t be able to have another world.” Shri Deepak Gupta, Secretary, Ministry of New and Renewable Energy, said he hoped that the interest shown by the large number of students indicates promise for the future.

Dr Farooq Abudullah, presented the DIREC Declaration, which reads as follows:

· We acknowledge the multiple benefits provided by renewable energy. Together with energy efficiency, it provides energy access especially for the poor; creates economic and job opportunities; improves air quality and moderates climate change; and enhances energy security and sustainable development. In the last five years, the renewable energy sector has grown strongly and steadily. Even in 2009, up against strong headwinds caused by the global recession, lower oil and gas prices, and the lack of an international climate agreement, total investment has increased.

· Besides finance, the growth in renewable energy has largely been policy driven. By early 2010, more than 100 countries had some type of target and/or promotion policy related to renewable energy. In addition, adoption of renewable energy is no longer confined to the industrialized world—more than half of the existing renewable power capacity is now in developing countries.

· Despite the impressive growth in renewable energy adoption in the last five years, the challenge is that its share in the world’s primary energy supply remains small and its adoption uneven. The world has tapped only a small amount of the vast supply of renewable energy resources. For the upward trend of renewable energy growth to accelerate, technology development and policy efforts need to be taken to the next level, and large-scale private investment needs to be encouraged.

· A large proportion of the world’s population has remained without access to modern energy services for too long. Depending upon the energy source in question (electricity for lighting, modern cooking fuel, etc.) anywhere between 1.4 billion and 2.7 billion people lack modern energy services. The use of renewable energy sources will not only provide access, but also help in the eradication of poverty and in the achievement of the other Millennium Development Goals (MDGs).

· The goal enunciated by the UN Secretary General’s Advisory Group on Energy and Climate change (AGECC) of universal access to modern energy services by 2030 is commendable and should be pursued by the international community and accorded a high development assistance priority.

· We support the designation of a Year of Access and call upon the United Nations to designate 2012 as the International Year of Energy Access. We agree to work with governments, development banks, the private sector and NGOs to achieve this objective.

· In many of our countries, investments in targeted research and development in the energy sector are much lower than in other comparable sectors of the economy and incommensurate with the scale of the task at hand. We reaffirm the importance of investments in research, development and deployment (RD & D) and of international cooperation in RD & D for more cost-effective and advanced energy technologies.

· It is only by significant scaling-up of renewable energy that we will enter the virtuous cycle of cost-reductions followed by more significant scaling-up. We recognize that increasing the use of renewable energy faces several challenges but consistent and sustained government policies can and do have a favorable impact on technology deployment. Supportive frameworks, procurement policies, a level playing field, providing access to affordable long-term finance, all will help increase the uptake of renewable energy. The integration and mainstreaming of renewable energy into national sustainable development strategies for poverty reduction, agriculture, education, health and family welfare, will further provide more opportunities for scaling-up.

· We welcome and urge cooperative global action to strengthen human and institutional capacities in developing countries. Long-term strategies for capacity building are required for policy analysis and technology assessment, supporting development of technologies and related skills in sourcing, marketing, installing, operating, maintaining, and servicing renewable energy equipment and in the sharing of best practices.

· While there is no shortage of capital in the world, the challenge has always been how to scale up private investment in clean energy in developing countries. Public funds are instrumental in leveraging and incentivizing large-scale private investment in developing countries through, for example, guarantees, risk sharing, buying down interest, etc. The provision of fast-start funding in the Copenhagen Accord, as well as existing multi-lateral and national funds, could catalyze much larger private flows for clean energy in developing countries. Some of these resources should also be provided for improving access to modern energy services in rural areas of the developing world.

· We welcome the Delhi International Action Programme that encourages governments, international organizations, private companies, industry associations, and civil society organizations to take voluntary action for up-scaling renewable energy within their jurisdictions or spheres of responsibility. We request the Government of India to present an update of these voluntary actions at the next International Renewable Energy Conference to be hosted by the Government of Abu Dhabi, UAE.

IMF Mission Concludes Discussions on Program Review with Mozambique

October 29, 2010

An International Monetary Fund (IMF) mission visited Mozambique during October 19-29, 2010 to conduct the first review under the new three-year Policy Support Instrument (PSI) which was approved in June. Policy discussions were held with the Minister of Finance, Hon. Manuel Chang; the Minister of Planning and Development, Hon. Aiuba Cuereneia; the Governor of the Central Bank of Mozambique, Hon. Ernesto Gouveia Gove; and other senior government officials. The mission also held meetings with representatives of the private sector, civil society, and development partners. The mission briefed the Prime Minister, Hon. Aires Bonifácio Baptista Aly, on the mission’s findings.

Mr. Johannes Mueller, Mission Chief for Mozambique, issued the following statement in Maputo at the conclusion of the mission on October 29:

“Mozambique’s economic performance remains strong, notwithstanding a difficult external environment. Economic growth could exceed 7 percent in 2010 and is projected to accelerate to 8 percent over the medium term. A recovery in external demand, rising private capital inflows, and continued strong donor support should improve Mozambique’s external accounts and bolster its international reserves at comfortable levels. Nonetheless, the accommodating monetary and fiscal policies adopted in the wake of the global crisis, together with balance of payments pressures, contributed to a depreciating exchange rate and a rise in inflation, which has placed a considerable burden on the most vulnerable segments of the population.

“With economic growth on a solid footing, the mission supports the authorities’ intention to counter the emergence of inflationary expectations through a tightening of their macroeconomic policies. This should help return headline inflation to single-digits next year. Supporting the Bank of Mozambique’s unwinding of the monetary stimulus adopted during the global crisis, the government intends to further strengthen its revenue collections and prioritize its spending in an effort to reduce the primary domestic fiscal deficit in 2011. The mission welcomes that spending will favor the priority social sectors and infrastructure investment in an effort to strengthen the country’s productive base and provide a catalytic effect for private sector activity. The program’s structural reform focus will continue to be on public financial management, tax policy and administration, debt management, and a strengthening of the financial sector.

“The mission commends the authorities’ dedication to drafting a new Poverty Reduction Strategy over the next few months, in close consultation with the private sector, civil society, and development partners. It considers the new strategy a welcome opportunity to work towards making Mozambique’s impressive economic growth more inclusive, with a view to generating employment opportunities and improving household livelihoods.

“The IMF's Executive Board is scheduled to discuss the first PSI program review under the new program in December 2010.”

Friday, October 29, 2010

Prime Minister to Inaugurate International Conference Petrotech 2010

Under the aegis of Ministry of Petroleum and Natural Gas the 9th Petrotech International Oil & Gas Conference and Exhibition, is being held at New Delhi from 1st November to 3rd November, 2010. The conference will be inaugurated by the Prime Minister of India, Dr Manmohan Singh on 1st November 2010.

‘Global Energy Equilibrium’ is the theme for PETROTECH–2010 with five technical sub – themes i.e. i) Exigent Hydrocarbon, ii) Greening the Hydrocarbon Value Chain, iii) Managing Uncertainty in the Hydrocarbon Business, iv) Energy Next and v) Non–Conventional Hydrocarbon. It aims at sharing of knowledge and expertise within the global oil industry.

Shri Murli Deora, Minister for Petroleum & Natural Gas will inaugurate the exhibition on 31st October 2010 at Hall No 18, Pragati Maidan. The exhibition will be a complete green event wherein materials which consume minimum energy and leave minimum carbon footprints viz. recycled wood, recycled carpet for flooring, CFL or LED bulbs for lighting, etc. will be extensively used. Over 350 exhibitors including more than 200 International companies will occupy 7700 sq metres space in the exhibition. Ten Country Pavilions that of Russia, Malaysia, Canada, China, Kazakhstan, Qatar, Holland, Denmark, UAE and Indonesia will be on display at the Exhibition.

While carrying forward the legacy of a world-class platform for exchange of knowledge, this 9th edition of Petrotech is different in many respects:

•It is the first carbon neutral event in the country. The CO2, emissions have been mapped by M/s Deloitte and will be written – off by ONGC. This will entail an emphasis on minimizing use of paper, group transportation solutions using CNG, an omnibus resource website, minimum travel in organizing the event and redesign of the sponsorship package from the print medium to the visual and electronic medium.

•It is the first PETROTECH event that has a very strong focus on CSR and is billed as a ‘No – Bags’ conference. In-lieu of each delegate bag; six school bags are being distributed to children from underprivileged sections of society. Each delegate still gets a customized gift pack manufactured by Tribes India, an institution focused on improving the livelihood of tribal crafts-persons of India.

•‘Training for Teachers’ Center is being set – up with an investment of 25 Lakh. It will train teachers who will then impart educations to children in remote and inaccessible locations.

•It is also for the first time that PETROTECH is being associated directly with the World Petroleum Council (WPC). After Beijing and Paris, the 3rd WPC Youth Forum is being organized as a parallel Track to PETROTECH – 2010 on Nov 2nd 2010. The program has been designed to implement the WPC Youth Committee’s agenda of inculcating values of sustainable development, CSR, ethics & corporate governance and gender sensitivity amongst the youth associated with the hydrocarbon industry. Two pre–conference events on Shale Gas and Oil – Spill Response are also being co–organized with the WPC on Oct 30th 2010.

•It is also for the first time that a conscious attempt has been made to reach out to the Indian populace directly through pre-conference events such as organizing a Walkathon, Students Essay and Quiz Competitions, an in-depth study and tabling of report on making India a global hub for manpower export for the hydrocarbon industry and televised panel discussions.

•The event format also has been re-designed around panel discussions instead of speeches so that the program becomes dynamic, interactive and interesting for the audience and also generates many new perspectives for legacy creation.

Around 4000 delegates and speakers and exhibitors are expected to attend this conference and deliberate on how the global energy markets operate through three panel discussions - the CEO’s Panel, the Ministerial Panel and the Thought Leaders’ Panel. On Nov 2nd 2010, five technical sub – themes will be discussed threadbare by domain experts and industry stalwarts in five plenary sessions, even as 448 technical papers are presented in concurrent break-out sessions. The Policy Shapers Panel on Nov 3rd 2010 will discuss the ‘connect’ between policy formulation and growth of the industry while the conference declaration will be formally announced in the valedictory session.

Australia's largest Gold Producer ordered Polysius high pressure grinding roll POLYCOM

Technological knowhow clinched the deal

Newcrest Mining Ltd, Australia's largest Gold producer, contracted Polysius Australia to supply a POLYCOM high pressure grinding roll for its Cadia East expansion project. The HPGR system will supplement the existing gold ore crushers and mills at Newcrest Cadia Hill Mine, in Orange, New South Wales.

The POLYCOM will have a rated throughput of 2,650 tonnes of gold ore per hour. It is equipped with variable speed drives with a rated power of 2 x 2,800 kW.

The Polysius high pressure grinding roll POLYCOM has very impressive credentials from its many years of application in production plants of the minerals industry. Gold ore is an extremely hard material that causes severe grinding element wear. It is therefore a significant advance that a new roll tyre concept introduced by Polysius has substantially improved service lives. Whereas it was formerly necessary to replace worn rolls with new ones, they can now be refurbished several times in Polysius service centers. This is a real money saver for our customers. Polysius already has service centers in Australia, Peru and South Africa. A fourth one is due to open soon in China.

Polysius AG, a member company of ThyssenKrupp with subsidiary firms on all 5 continents and more than 2,000 employees all around the world, is one of the leading engineering companies equipping the cement and minerals industries.

Polysius is a strong partner offering project elaboration, engineering and design, shipment, field assembly and commissioning, as well as comprehensive service activities, for complete production lines, individual products, plant conversions and upgrades


MOUNT ISA, 29 October 2010


Xstrata and Queensland Government approvals have now been received for a AUD274 million (USD246 million) expansion of Xstrata Zinc’s George Fisher Mine in Mount Isa to increase the production rate by almost 30% from 2013.


Xstrata Zinc Australia Chief Operating Officer Mr Brian Hearne said the expansion of the underground mine is indicative of the strategic opportunities for growth within the group’s assets.


“George Fisher Mine contains one of the largest zinc reserves in the world and the expansion project enables us to further tap its significant resource potential,” Mr Hearne said.


The George Fisher Mine (GFM) expansion follows the approval of the AUD133 million Black Star Deeps open cut development to bring the total value of new mining projects in Mount Isa announced by Xstrata Zinc this year to AUD407 million (USD362 million).


Both projects ensure the full utilisation of the zinc-lead concentrator capacity in Mount Isa which was raised to 8.0 million tonnes per annum in 2009.


The GFM expansion will increase the annual production rate from 3.5 million tonnes per annum to 4.5 million tonnes per annum and will create jobs for an additional 250 contractors in construction and 120 employees in its operation.


The project involves the development of a second hoisting shaft and associated infrastructure to service the northern area of the mine using large diameter raise boring technology. It will also include the installation of an underground crushing and ore handling facility and upgrades to power and air ventilation services.  An existing shaft servicing the northern end of the mine will be lined and extended by 420 metres to a depth of 1,140 metres.


The Xstrata Executive Committee approved the development on 29 September 2010. The Queensland Government’s approval of a Mine Plan Variation for the project was received on 28 October 2010.


The Mine Plan Variation was prepared based on a 14 month, AUD6.5 million feasibility study which found the project would cause minimal changes to the mine’s current environmental conditions.


Mr Hearne said the expansion project had been encouraged by a 126% increase in zinc reserves from 33 million tonnes when Xstrata acquired the operation in 2003 to 76 million tonnes this year.


“While the increased production rate will reduce the life of mine by five years to 21 years, the orebody remains open at depth to the north of the mine,” he said.


“The additional production capacity built into the expansion project and our ongoing exploration program will ensure GFM remains a key part of our long term strategy for Mount Isa.”


Work will commence immediately on the 2.5 year GFM expansion project with equipment mobilised to begin ventilation shaft works during November.

CopperCo and Lady Annie Mine: Environmental Remediation Program Successful


The Receivers and Managers of CopperCo Limited (In Liquidation) (Receivers and Managers Appointed) (ASX: CUO) are pleased to report that a program of remedial work at the Saga and Inca creeks near the Lady Annie operations in Queensland is complete, and that water in the creeks is again fit for livestock consumption.


Queensland’s Department of Environment and Resource Management (DERM) issued Environmental Protection Orders on CopperCo and its subsidiary company, Lady Annie Operations following discharge from the Lady Annie mine site as a result of widespread flooding in northern Queensland in January and February 2009.


The Receivers appointed infrastructure and environmental consultancy firm Parsons Brinckerhoff to carry out the program of remedial work and have worked closely with DERM and the affected community to successfully satisfy all the requirements of the Environmental Protection Orders.


Some $10 million has been invested in the remedial program to-date, and the Receivers and DERM are in agreement that water in the affected Saga and Inca creeks is now fit for livestock consumption.


Extensive remedial work has also been carried out onsite at the Lady Annie Operations including the construction of an upgraded stormwater drainage system designed to redirect run-off during heavy flooding events to prevent reoccurrence of the 2009 incident.


The Receivers are continuing to work closely with DERM and will commission final testing of the waterway after the coming wet season which is expected will see a repeat of the natural flushing effect evidenced in the 2009 wet season.

ArcelorMittal keen on SAIL JV

The world's largest steelmaker ArcelorMittal said it is still in talks with SAIL for a possible joint venture. =2 other global companies, POSCO and Kobe Steel, have also expressed keenness for partnership with SAIL.

Mr Sudhir Maheshwari Group Management Board Member of ArcelorMittal during a conference call after announcing a net income of USD 1.35 billion for the third quarter of 2010 said “We have made a proposal to SAIL and we are in discussion with SAIL. With respect to SAIL we have not set any timeline.”

ArcelorMittal had proposed to join hands with Steel Authority of India Ltd earlier this year. It could be looking at partnering SAIL for proposed steel plant at Sindri in Jharkhand.

Both POSCO and ArcelorMittal had announced their intent to set up large steel projects in India way back in 2005, but things have hardly moved on the ground owing to land acquisition troubles.

China's coercive language policy 

China is doing no good to itself and to its standing in the world by becoming known more and more for its deliberately designed policy of pinpricks than for mature handling of situations.

Hardly had the contretemps over its blackballing of General B. S. Jaswal, the General Officer Commanding-in-Chief of India's Northern Command, who was to lead the team for the fourth India-China defence dialogue, subsided when it got into an unseemly confrontation with Japan by letting its trawler trespass into territorial waters that the latter had always claimed to be its.

While the embers of that hotbed of contention are yet to die down, China's rulers have once again displayed their peculiar penchant to stir up trouble for themselves by meddling with the language policy.

In the process, they have excited suspicion and anger among linguistic and ethnic minorities, resulting in public protests at various places in Guangdong, Gansu and Qinghai provinces.

In July last, in the city of Guangzhou, the capital of the Guangdong province, the needlessly provocative action of the local political boss ordering a TV network to change to Mandarin in its programmes and discontinue the use of Cantonese, which was the traditional majority language of the province, led to public expression of opposition and resentment.

It was soon clear that this was not an aberration by an overzealous official but was part of a pre-planned move by China towards an ‘integrationist' and coercive language policy which would give primacy to Mandarin as the official language and medium of instruction in educational institutions and downgrade the importance of regional languages.


In fact, the party secretary of Qinghai Province was reported by the People's Daily as taking an aggressive stand, asking ‘officials at all levels' to go ahead making Mandarin compulsory, without any worry about hurting minority people's feelings or its impact on the development of minority culture or social stability.

It is a mystery why China chose to take on the linguistic and ethnic minorities at this time. Its approach has been ham-handed, to say the least, on several counts.

Knowing that its attitude to Tibet and Tibetans is yet to get the full acceptance of the world community, it has shown extreme tactlessness in inviting adverse publicity upon itself by seeming to target Tibetans who have taken the new policy as an attack on their language and culture.

By pushing for language reform in this abrupt manner, China has also violated its own Regional Ethnic Autonomy Law of 1984 which guarantees the right of minorities to use and develop their own spoken and written languages and use textbooks written in their own languages and use these languages as the medium of instruction.

The fear of protests, with agitated students in the forefront, becoming widespread has made the Chinese authorities backtrack.

They have reportedly sought to reassure the teachers and students in an open letter that education in their ethnic language will not be neglected and that in places where conditions are not ripe, the authorities will not forcefully push the reforms.

The educational institutions have been asked to follow teaching rules and listen and respect viewpoints and advice from students and their parents before carrying out the reforms.

Of all the prized gifts of human existence, one's own language is the most cherished one for imparting to one's personality and culture its unique grandeur and glory.

Anything that touches on it should be approached with the greatest delicacy and respect.

That China should ride roughshod over such an emotive issue and then beat a hasty retreat bespeaks of a tendency to act first and think later. It has to be curbed since it can create problems in the external context as well.

Changing winds of global economic policy
(The author is a trade economist, specialising in international trade policy. )


The last couple of years seem to have ushered a seismic change in the global outlook on economic policy. More than the popular disenchantment with globalisation in the western world, what is telling is the change of heart among the key proponents of free market economics.

The IMF's open support of capital controls as a stabilising policy tool in February this year and the recent endorsement from an important member of the US President's economic advisory council on the need for the world to move away from market fundamentalism can be deemed as tectonic shifts in international economic thinking that until recently was underpinned by the Washington Consensus.

Limitation of markets

The economic uncertainty in the aftermath of the 2007-08 financial crisis has led to a renewed appreciation today that authoritarian capitalism is as liable to abuse its power as authoritarian governments. The limitations of markets to deliver social objectives and development are also being acknowledged.

As noted by Kevin Gallagher in his most recent Financial Times article, “The pendulum has now swung in the other direction. A parade of studies (from multilateral institutions and renowned economists worldwide) have showed that capital account liberalisation was not associated with growth in emerging markets, and that capital controls have been fairly effective.”

Even in the sphere of trade policy, analysts are cautious in linking development with trade, unlike in the pre-crisis times when greater trade openness was thought to be synonymous with trickle-down welfare enhancement. It is now more rationally acknowledged that trade and market openness do lead to higher growth, though not necessarily to equitable growth; and that countries need to institute appropriate redistribution systems and implement complementary domestic policy reforms for the benefits of trade-led growth to reach a larger section of the population.

Continued disconnect

The problem, however, lies in the continued disconnect between economic rationale and politics. And it is most starkly apparent in the much-talked of financial reforms and restraint that the G-20 leaders are expected to deliver in Seoul at the November 11-12 meeting. While, on the one hand, the US negotiators continue to focus on the exchange rate adjustment as the main tool for global rebalancing, the prospect of continued super-loose monetary policy in the G-3 has led to a surge of investment capital into emerging market economies, thereby exacerbating the competitiveness challenges that have long been posed by Beijing's exchange rate policy.

The recently aired warnings from the UK and India about the G-20's future merely put into words what has already become apparent from the actions of several governments — that several leaders doubt a multilateral solution to global imbalances and currency frictions is within reach.

As a result, many have opted for unilateral actions on capital control to avoid being squeezed between the US and China. The success of the G-20, or for that matter any multilateral negotiating forum, will necessarily have to depend on the proactiveness of the world's reigning superpower, the US. However, continuing preoccupation in the US with fixing its domestic economy has translated into a lack of meaningful engagement with the rest of the world on most multilateral issues.

The US posture on both trade and climate negotiations continue to reflect not only a lack of leadership and political will, but a hubris that is counterproductive to accomplishing anything.


Nevertheless, the global economic situation is not as bleak as the above discussion may imply. A redeeming feature of recent times has been that the North-South business initiatives and private sector economic cooperation have sustained, albeit at a low level in view of the weak global growth scenario.

But the cooperation evident in the real world is not evident at the diplomatic level. It is no wonder then that disenchantment with the G-20 process has been accelerating in recent months and that the prospects of G-20 appear rather dim, as is the case for both the Doha Round of trade negotiations and the climate change talks.

If multilateral institutions and policy groups wish to remain relevant, it is imperative that policymakers begin to lead and not lag the private sector initiatives. Injection of some much-needed economic pragmatism and a more co-operative outlook among the negotiators is necessary if the world is to shrug off the pervading sense of missed opportunities at successive G-20 meetings.

Strategic approach needed

Many articles in this column have argued for a more strategic approach to national policymaking and for shunning short-termism while devising strategies for issues with multilateral/cross-border implications. Giving in to political expediency often forces countries to opt for policies that become inimical to reforms and structural change.

But even more damaging are the consequences of complacency, inaction and delayed action. And this holds as true for developed countries as it does for the developing ones. It is important that the issues between the US and the emerging economies, including China, are resolved politically, though losing sight of the business imperatives in the thrust and parry of political fencing would be akin to committing economic hara-kiri.

It is hoped that the forthcoming G-20 meet will be able to distinguish and draw the fine line between the politics and economics of global cooperation. Indeed, it is here that the winds of change in strategic thinking are needed the most.

Food inflation eases to 13.75% on cheaper vegetables, pulses

Food inflation, based on the annual Wholesale Price Index, eased sharply in mid-October, even as it continues to remain high to exert pressure on the RBI to hike interest rates further.

The Food Price index increased 13.75 per cent in the week ended October 16, sharply lower that the previous week's annual rise of 15.53 per cent, mainly as vegetables continued to exert downward pressure on account of a base effect. Cereals and pulses also contributed to the downward trend. The fuel price index for the latest week surged 11.25 per cent against an annual rise of 11.14 per cent in the previous week, according to data issued by the Ministry of Commerce and Industry on Thursday.

Higher food prices have already pushed up headline monthly inflation to 8.62 per cent in September from 8.5 per cent in the previous month, as against the RBI's “comfort zone” of 5-6 per cent. The central bank is widely expected to hike its key lending rates at its next review on November 2 — the sixth such hike since March — as it looks to close in on its end-March inflation projection of 6 per cent.

According to the data, the Primary Articles group index gained 16.62 per cent during the latest reported week against 18.05 per cent during the previous week. On a sequential basis, the index declined 0.4 per cent as the index for 'Food Articles' group dipped by 0.7 per cent due to lower prices of fruits and vegetables (4 per cent) and bajra, jowar, fish-inland, masur and urad (1 per cent each). However, the prices of poultry chicken, arhar and fish-marine (4 per cent each) and barley (3 per cent) moved up.

The index for ‘Non-Food Articles' group was up 0.3 per cent due to higher prices of copra (7 per cent), raw jute (5 per cent), raw rubber (3 per cent) and raw silk (1 per cent). However, the prices of fodder (3 per cent) and cotton seed and castor seed (1 per cent each) slipped.

The fuel index rose by 0.4 per cent on a sequential basis due to higher prices of light diesel oil (6 per cent), aviation turbine fuel (3 per cent), naphtha and furnace oil (2 per cent each) and petrol (1 per cent). However, the prices of bitumen (2 per cent) dropped.

Evraz Priced 15 Billion Rouble Bond Issue

Evraz has priced a 15 billion 5-year rouble bond at a coupon rate of 9.95% per annum. The bonds are issued by Evraz’s subsidiary, OOO EvrazHolding Finance, and guaranteed by Evraz Group.

The closing and settlement is expected to be completed on 1 November 2010.

Proceeds from the issue will be used to refinance Evraz’s existing debt, thus not increasing the total debt level.

Barclays Capital, Gazprombank and Troika Dialog are acting as Joint Arrangers and Bookrunners of the issue. Russia’s Sberbank and UniCredit Bank are joint lead managers of the placement.

Arms transfers to conflict zones in Africa: suppliers need to take greater responsibility, according to new SIPRI reports

(Stockholm, 28 October 2010) Two new SIPRI reports highlight the limitations of United Nations attempts to control the flows of arms into two African conflict zones―the Democratic Republic of the Congo (DRC) and Somalia―and the role of potential arms-supplying states.

In both the DRC and Somalia the UN has imposed arms embargoes designed to prevent rebel groups from accessing arms. In addition, countries wanting to send arms and ammunition to government forces must notify a specially created Sanctions Committee―which, in the case of Somalia, has the authority to block the transfer. The two new SIPRI reports show that enforcing these embargoes has proved problematic. And even arms supplies that do not violate the embargoes can have undesirable consequences.

‘Arms flows and the conflict in Somalia’, by SIPRI Senior Researcher Pieter D. Wezeman, examines recent arms supplies to Somalia and to African countries that have been involved in the conflict there: Eritrea and Ethiopia―two states that are widely believed to be fighting a proxy war in Somalia―and Burundi and Uganda, which provide peacekeepers to the African Union Mission in Somalia (AMISOM). 

As the paper shows, there is a real risk that arms supplied to Somali government forces and the AMISOM contributors could fall into the wrong hands and could be used in human rights abuses or aggravate tensions between Eritrea and Ethiopia.

‘Arms transfers to the Democratic Republic of the Congo: assessing the system of arms transfer notifications 2008–10’, by SIPRI Senior Researchers Mark Bromley and Dr Paul Holtom, focuses on implementation of the requirement that arms suppliers to the Congolese Government notify the UN Sanctions Committee for the DRC. The report highlights some loopholes and grey areas in the current notification system. It also argues that a lack of full cooperation between supplier states and the UN Sanctions Committee is undermining the system.

In a situation where arms supplied to the Congolese government forces continue to be diverted to armed groups and used against the government forces and international peacekeepers, it is vital that the notification system works as planned. If it does not, there is a risk that arms supplies will fuel conflict in the eastern DRC and raise tensions in the Great Lakes region.

Stockholm International Peace Research Institute (SIPRI)
SIPRI is an independent international institute dedicated to research into conflict, armaments, arms control and disarmament. Established in 1966, SIPRI provides data, analysis and recommendations, based on open sources, to policymakers, researchers, media and the interested public. SIPRI is named as one of the world's leading think tanks in Foreign Policy magazine's 'Think Tank Index'.

Thursday, October 28, 2010

IMF Regional Outlook Sees Recovery Taking Hold in Caucasus and Central Asia

October 28, 2010

The economic upturn in the Caucasus and Central Asia is gathering momentum, with growth for the region projected to increase to 5¾ percent in 2010, up from 3½ percent in 2009, the International Monetary Fund (IMF) said in its Regional Economic Outlook for Caucasus and Central Asia (CCA) released in Almaty today. According to the report, fiscal stimuli applied by many governments in the region—together with a favorable external environment—have helped spur the recovery from the global crisis. The report notes that the upturn in Russia’s economy has benefited the region as well, mainly through trade and remittance channels (see chart), as has the rise in hydrocarbon prices.

“The outlook for the region is broadly positive, although in some countries it will take time for per capita disposable income to return to pre-2009 levels,” said Middle East and Central Asia Department Deputy Director David Owen.

Sustained growth for energy exporters

According to the report, growth in 2010 is expected to be strongest among the region’s oil and gas exporters, with projections ranging from 4½ percent in Azerbaijan to 9½ percent in Turkmenistan. With oil prices expected to remain near $80 per barrel in 2011, these countries should grow at similar rates in 2011.

Russia’s upturn helps energy importers

Among the oil and gas importers, Armenia and Georgia are forecast to grow at 4 percent and 5½ percent, respectively, in 2010, compared with negative growth in 2009. In Tajikistan, growth is estimated at 5½ percent for 2010—about 2 percentage points higher than in 2009. Buoyed by Russia’s recovery, all three countries are projected to grow at 4–5 percent in 2011.

In the Kyrgyz Republic, political and ethnic turmoil earlier in the year are weighing heavily on this year’s performance. Economic activity is expected to shrink by 3.5 percent in 2010, but bounce back strongly in 2011 and grow by a projected 7 percent.

Inflation needs to be watched closely

Inflation across the CCA region as a whole has come down from high pre-crisis levels, and underlying inflationary pressures are expected to remain contained over the next year, the report notes. In a few countries, however, headline inflation has been impacted significantly by the recent spike in food—especially wheat—prices, and policymakers will need to monitor developments closely. In Uzbekistan, continued fiscal stimulus, combined with lower interest rates and directed lending, raise the risk of a further buildup in inflationary pressures—a possibility that Turkmenistan also faces.

Risks ahead

Despite the region’s apparent recovery, risks remain, the report says. In particular, a weaker-than-expected recovery in Russia would adversely affect trade and remittance flows to the region. Slower-than-expected growth in advanced economies would also weaken economic activity in the region, mainly through a drop in demand for oil and gas. And continued banking sector weaknesses sector could hold back credit growth and weigh on the economic outlook.

Policy response

With regard to the policy response, the report recommends that countries across the region use the current recovery to start winding down policies that were implemented in response to the crisis. When unwinding, the authorities should first exit from fiscal stimulus, in light of fiscal sustainability considerations, the report adds. This is particularly true for oil and gas importers, which are facing rising public debt as a result of their policy response to the crisis and declining donor support.

Turning to monetary policy, the IMF says that it can remain accommodative for now, not least because banking sectors in many countries remain impaired—particularly in Kazakhstan, where there are high levels of nonperforming loans. At the same time, the report warns that authorities need to pay close attention to inflation developments and act quickly, if necessary, to prevent an increase in inflation expectations.

In CCA oil and gas importers, current account deficits remain high, especially in Georgia and Armenia. Foreign direct investment inflows in most countries have not yet returned to pre-crisis levels, and external debt is high and rising. Going forward, policymakers should therefore focus on reining in current account deficits to help preserve external sustainability.

For the CCA oil and gas exporters, managing hydrocarbon wealth by ensuring an efficient use of public resources remains a key medium-term policy challenge. “Looking ahead, it will be important for these countries to develop their non-oil economy while managing hydrocarbon wealth wisely,” Mr. Owen said. “Laying the basis for high and sustained growth will also require that the authorities speed up structural reforms aimed at improving the business environment and creating more room for private-sector activity,” Mr. Owen concluded.

Selected Economic Indicators in Caucasus and Central Asia (CCA)

  Average         Proj. Proj.
  2000–05 2006 2007 2008 2009 2010 2011

Real GDP Growth

9.4 13.7 12.4 6.5 3.6 5.7 5.4

(Annual change; percent)



11.2 13.2 13.7 6.9 -14.2 4.0 4.6


11.3 34.5 25.0 10.8 9.3 4.3 1.8


6.4 9.4 12.3 2.3 -3.9 5.5 4.0


10.3 10.7 8.9 3.2 1.2 5.4 5.1

Kyrgyz Republic

4.1 3.1 8.5 8.4 2.3 -3.5 7.1


9.2 7.0 7.8 7.9 3.4 5.5 5.0


16.6 11.4 11.6 10.5 6.1 9.4 11.5


5.1 7.5 9.5 9.0 8.1 8.0 7.0

General Government Fiscal Balance

0.6 4.2 3.1 6.3 0.9 1.2 1.6

(Percent of GDP)



-2.6 -2.0 -2.3 -1.8 -7.8 -4.8 -3.9


0.2 -0.2 2.6 20.8 6.8 13.9 14.4


-1.1 -3.0 -4.7 -6.3 -9.2 -6.1 -4.5


2.4 7.2 4.7 1.1 -1.5 -2.8 -2.0

Kyrgyz Republic

-5.6 -2.1 -0.3 0.0 -3.7 -12.0 -8.5


-3.0 1.7 -6.2 -5.9 -5.2 -4.4 -5.1


1.0 5.3 3.9 11.3 7.8 2.8 1.3


-0.6 5.2 5.3 10.7 3.2 2.2 2.4

Current Account Balance

-1.6 3.2 1.6 9.0 0.8 5.3 5.2

(Percent of GDP)



-6.4 -1.8 -6.4 -11.8 -16.0 -14.6 -12.6


-12.2 17.6 27.3 35.5 23.6 24.1 22.2


-8.0 -15.1 -19.7 -22.7 -11.7 -12.0 -12.5


-1.4 -2.5 -8.1 4.6 -3.2 3.2 2.0

Kyrgyz Republic

-0.1 -3.1 -0.2 -8.1 2.1 -5.4 -9.4


-3.0 -2.8 -8.6 -7.7 -4.9 -3.6 -5.7


4.1 15.7 15.5 18.7 -16.1 -4.7 3.4


3.8 9.1 7.3 8.7 2.7 3.8 6.3

Sources: National authorities; and IMF staff estimates and projections.
1Central government.
2State government.

SAIL records a sales turnover of Rs. 11,697 crore in Q2

Q2 profit after tax (PAT) at Rs. 1090 crore

New Delhi:  Steel Authority of India Limited (SAIL) recorded a sales turnover of Rs 11,697 crore during July-Sept. (Q2) of the current financial year, registering an increase of 9% over the corresponding period last year (CPLY) and nearly 18% increase over the preceding quarter Q1. SAIL registered profit before tax (PBT) of Rs 1592 crore and profit after tax (PAT) of Rs 1090 crore, which were about 36% and 34% lower than CPLY respectively. PBT variation of Rs. 927 crore compared to CPLY, is primarily caused by increase in input price to the tune of Rs. 1097 crore (out of which, Rs. 939 crore is on account of imported coking coal alone). The wage cost in Q2 was up by Rs. 572 crore over CPLY on account of revised wage structure.

Total Sales in Q2 were 3.03 Million tonnes, an increase of over 30% over the preceding quarter, with value-added sales being 38% of the total sales. During the quarter, SAIL’s Net worth has risen by Rs.1,090 crore to over Rs. 35,583 crore as on September 30, 2010. Debt equity ratio has come down from 0.5 in the preceding quarter to 0.38 as on September 30, 2010.  

The unaudited financial results of SAIL for Q2 were taken on record here today by the company’s Board of Directors.

During the quarter, commissioning of second ladle furnace at Rourkela Steel Plant and new tension leveling line at Salem Steel Plant were carried out. 74 SAIL employees received Vishwakarma Rashtriya Puraskar and 56 employees received Prime Minister’s Shram Awards. SAIL also signed a joint venture with RITES Ltd. for setting up a Wagon Manufacturing Unit at Kulti, Bardhman district in West Bengal.

Announcing the Q2 results, SAIL Chairman Mr. C.S. Verma said: “We have been able to withstand external market conditions, be it substantial increase in input costs or pressure on margins. This has been possible due to increased sales and optimization of product-mix. With input costs likely to stabilize in the coming weeks, we are confident of overcoming the impact of the market.”


Evraz Completes First Stage of Rail Mill Modernisation at NKMK

Evraz Group S.A. has completed the first stage of the rail mill modernisation at NKMK, one of Evraz’s Russian steel plants located in Novokuznetsk, Siberia, with a capacity of 750,000 tonnes of rails per annum.

Installation of state of the art equipment will ensure premium quality of rails and satisfy requirements of the most advanced Russian and European standards for rail geometry and steel purity. Due to their enhanced quality characteristics, these rails can be used in high speed transportation, and can be sold at a premium compared to standard rails.

The investment under the first stage of the NKMK rail mill modernisation was 44 million euros. Completion of the second stage is scheduled for 2012. Once the modernisation is complete, NKMK will launch the production of 100-metre rails for high-speed transportation – a unique premium product.

Evraz is the world’s largest rail producer, and the only producer of rails in Russia. Evraz operates two rail mills in Russia (NKMK, and NTMK in Nizhy Tagil, Ural Region) and one mill in the USA (Rocky Mountain, Colorado). Evraz’s total rail mill capacity is more than 1.6 million tonnes per annum, including more than 1.1 million tonnes of rails in Russia.

Commenting, Alexander Frolov, Evraz Group’s CEO, said, “Modernisation of Evraz’s rail production in Russia, in particular at NKMK, strengthens our position as a world leading rail producer. We are aware of the growing demand for higher quality and longer rails in our key markets and interest for such rails from our major customer in Russia, OAO RZhD – Russian Railways, and invest in modernising our production capacities in order to meet this demand.”

How Can India’s Fast-Growing Economy Benefit the Entire Country?

  • Best video answer to the Davos Debates question wins a trip to the 2010 India Economic Summit
  • Competition open to anyone in India via YouTube at

Geneva, Switzerland, 28 October 2010– For the first time at the India Economic Summit, the World Economic Forum is asking the wider public in India to submit their video replies to the Davos Debates in India question: “How can India’s fast-growing economy benefit the entire country?” The Davos Debates is a video channel dedicated to public debate and discussion with global leaders on the key issues affecting our planet.


​Report for the Third Quarter of 2010

The quarter (Unless otherwise stated, the report relates to continuing operations, i.e. excl. tubular business)

  • Sales increased by 43%, to SEK 9,902 (6,936) million    
  • Operating profit of SEK 289 (-936) million             
  • Profit after financial items of SEK 151 (-1,098) million          
  • Earnings per share of SEK 0.51 (-2.33)                   
  • Operating cash flow of SEK -686 (1,026) million and cash flow from current operations of SEK -900 (990) million

Nine months (Unless otherwise stated, the report relates to continuing operations, i.e. excl. tubular business)

  • Sales increased by 38% to SEK 29,678 (21,554) million                  
  • Operating profit of SEK 1,165 (-2,022) million             
  • Profit after financial items of SEK 858 (-2,409) million            
  • Earnings per share of SEK 2.60 (-3.78)                   
  • Operating cash flow of SEK -89 (4,069) million and cash flow from current operations of SEK -355 (2,531) million         
  • Net debt/equity ratio of 54 (52)%             

(In the report, amounts in brackets refer to the corresponding period of last year.)

Comments by the CEO

The recovery continued during the third quarter, although at a slower pace than at the beginning of the year which, among other things, had benefited from inventory restocking by our customers. The underlying demand for our niche products enjoyed a continued positive trend and several end customers demonstrated good demand growth. Growth was strongest in China and South America, and within the mining industry and heavy transport segment. On the other hand, we have noted a more cautious approach among our customers within ordinary products in Europe and the US. During the quarter, we were able to carry out price increases which, however, were insufficient to compensate in full for higher raw materials costs. We are adhering to cost-savings targets and continuing to focus on optimizing cash flow.

Our ability to deliver has been negatively affected by an unscheduled production outage in Oxelösund during the summer. Thereafter, we have been at almost normal production levels at all plants in Sweden and the US.

The mining industry and the heavy transport segment are expected to continue to develop positively. In SSAB Americas, this is also the case as regards parts of the energy segment. Demand within the lifting segment, on the other hand, is expected to remain soft and growth within the automotive segment to slow down somewhat. The regions showing continued strong growth are China, South America, and Australia. A more cautious approach can be discerned among strip product customers and customers for ordinary plate, which has resulted in a weaker order book. Due to this, we believe that during the fourth quarter our plants will take some planned outages to adjust production to the order situation.

Our contract prices for coal fell somewhat pending the fourth quarter; however, due to existing stocks this will have no impact during this quarter. The iron ore agreement involves unchanged prices for the fourth quarter.

Currency hedging has already been employed as regards costs for coal and iron ore during the fourth quarter, and thus the recent decline of the US dollar will not have any positive effect during the fourth quarter.

Prices for quenched steels are expected to remain stable during the fourth quarter, while it is believed that prices of other products will be lower. As a consequence of the price trend combined with the fact that we will not achieve full plant capacity utilization, margins will come under pressure during the fourth quarter.

The recovery in the economy is expected to continue, and therefore in the somewhat longer term I remain optimistic as regards the growth of the steel market, and particularly for our niche products.

Olof Faxander
CEO and President

CSR collaborates with Infineon Technologies to integrate wireless connectivity onto mobile phone platforms


Bangalore –28 October 2010CSR (LSE: CSR) today announced that it is collaborating with Infineon Technologies to pre-integrate its wireless connectivity platforms onto Infineon’s cellular reference designs. This new cooperation allows mobile phone OEMs to easily add connectivity functionality beyond Infineon’s existing product portfolio to their products. The pre-integration of the complete functionality into a reference design significantly reduces development costs and time to market for new handsets.


CSR’s connectivity platforms will allow Infineon’s customers to deliver improved features and functionality, including sharing audio, pictures, videos, music and data, and connecting to mobile phones, headsets, computers, media players and numerous other wireless devices.


“’Connected everywhere’ has become an integral part of the consumer lifestyle.  By collaborating with CSR we are able to enhance our reference designs with pre-integrated Wi-Fi and wireless connectivity software framework, in addition to our in-house integrated connectivity IP,” commented Stefan Butz, Vice President of the Wireless Solutions Division and General Manager of the Business Line Entry Phones at Infineon Technologies. “CSR’s expertise and position as a leading supplier of embedded wireless connectivity makes it an important partner for Infineon and our customers.”


“This collaboration with Infineon will allow phone manufacturers to quickly and easily integrate Wi-Fi connectivity with minimum development time or expenditure,” said Matthew Philips, Senior Vice President of CSR’s Handset Business Unit. “The design simplicity is made possible using our CSR Synergy wireless systems software, which also provides the end users with a truly seamless wireless experience.”


CSR’s connectivity platforms offer Bluetooth® and Wi-Fi which are unified through the use of CSR Synergy software to deliver wireless connectivity. Targeted at a variety of types of handsets, the Infineon platforms feature highly integrated basebands with specifications that deliver full multimedia experiences.


CSR’s Synergy software is at the heart of the platforms’ connectivity, taking an overall systems approach to connectivity, making integration easier and reducing time-to-market for designers looking to implement single or multiple wireless technologies. CSR Synergy offers performance improvements in wireless technology interoperability and enables advanced new end-user use-cases.

Infineon platforms with integrated CSR’s wireless connectivity will be available in 2011.