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Storage Status of 91 Major Reservoirs of the Country is 65% of total storage capacity as on August 24, 2016
Aug 26,2016

The water storage available in 91 major reservoirs of the country for the week ending on August 24, 2016 was 102.147 BCM, which is 65% of total storage capacity of these reservoirs. This was 112% of the storage of corresponding period of last year and 102% of storage of average of last ten years.

The total storage capacity of these 91 reservoirs is 157.799 BCM which is about 62% of the total storage capacity of 253.388 BCM which is estimated to have been created in the country. 37 Reservoirs out of these 91 have hydropower benefit with installed capacity of more than 60 MW.

REGION WISE STORAGE STATUS:-

NORTHERN REGION

The northern region includes States of Himachal Pradesh, Punjab and Rajasthan. There are 6 reservoirs under Central Water Commission (CWC) monitoring having total live storage capacity of 18.01 BCM. The total live storage available in these reservoirs is 12.97 BCM which is 72% of total live storage capacity of these reservoirs. The storage during corresponding period of last year was 91% and average storage of last ten years during corresponding period was 75% of live storage capacity of these reservoirs. Thus, storage during current year is less than the corresponding period of last year and is also less than the average storage of last ten years during the corresponding period.

EASTERN REGION

The Eastern region includes States of Jharkhand, Odisha, West Bengal and Tripura. There are 15 reservoirs under CWC monitoring having total live storage capacity of 18.83 BCM. The total live storage available in these reservoirs is 11.80 BCM which is 63% of total live storage capacity of these reservoirs. The storage during corresponding period of last year was 53% and average storage of last ten years during corresponding period was 55% of live storage capacity of these reservoirs. Thus, storage during current year is better than the corresponding period of last year and is also better than the average storage of last ten years during the corresponding period.

WESTERN REGION

The Western region includes States of Gujarat and Maharashtra. There are 27 reservoirs under CWC monitoring having total live storage capacity of 27.07 BCM. The total live storage available in these reservoirs is 19.73 BCM which is 73% of total live storage capacity of these reservoirs. The storage during corresponding period of last year was 56% and average storage of last ten years during corresponding period was 66% of live storage capacity of these reservoirs. Thus, storage during current year is better than the storage of last year and is also better than the average storage of last ten years during the corresponding period.

CENTRAL REGION

The Central region includes States of Uttar Pradesh, Uttarakhand, Madhya Pradesh and Chhattisgarh. There are 12 reservoirs under CWC monitoring having total live storage capacity of 42.30 BCM. The total live storage available in these reservoirs is 34.94 BCM which is 83% of total live storage capacity of these reservoirs. The storage during corresponding period of last year was 75% and average storage of last ten years during corresponding period was 60% of live storage capacity of these reservoirs. Thus, storage during current year is better than the storage of last year and is also better than the average storage of last ten years during the corresponding period.

SOUTHERN REGION

The Southern region includes States of Andhra Pradesh, Telangana, AP&TG (Two combined projects in both states) Karnataka, Kerala and Tamil Nadu. There are 31 reservoirs under CWC monitoring having total live storage capacity of 51.59 BCM. The total live storage available in these reservoirs is 22.70 BCM which is 44% of total live storage capacity of these reservoirs. The storage during corresponding period of last year was 35% and average storage of last ten years during corresponding period was 65% of live storage capacity of these reservoirs. Thus, storage during current year is better than the corresponding period of last year but is less than the average storage of last ten years during the corresponding period.

States having better storage than last year for corresponding period are Rajasthan, Jharkhand, Odisha, West Bengal, Gujarat, Maharashtra, Uttar Pradesh, Madhya Pradesh, AP&TG (Two combined projects in both states), Telangana and Karnataka. States having lesser storage than last year for corresponding period are Himachal Pradesh, Punjab, Tripura, Uttarakhand, Chhattisgarh, Andhra Pradesh, Kerala and Tamil Nadu.

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Slowdown in MHCV Sales Volumes - A Change in Trend
Aug 26,2016

The decline in the year on year sales growth in the Medium and Heavy Commercial Vehicles (MHCV) segment in June-July 2016 is a digression of the trend observed previously, says India Ratings and Research (Ind-Ra). The agency believes that persistence in the slowdown in MHCV volumes in the next two to three months could point towards a change in the MHCV cycle.

Ind-Ra had earlier highlighted in its report FY17 Outlook: Auto that auto sales in FY17 will be driven by the MHCV segment. In January 2016 Ind-Ra had estimated MHCV volumes to grow by 12%-15% yoy in FY17 driven by demand for high tonnage vehicles to achieve cost efficiency in operations and replacement demand of old vehicles. The agency may re-look at its growth estimates based on MHCV volumes registered in the next one to two months.

The upturn in the MHCV cycle began around January 2014. The yoy growth was very strong at 30% in FY16 and 16% in FY15. As per Ind-Ras assessment, the growth is attributed to pent up demand, some pre-emptive purchases in August-September 2015 (due to new safety features being made compulsory from Oct 2015 - which increased prices) and improved cash flows of fleet operators due to the decline in diesel prices and the entire decrease not being passed on to clients. Another factor possibly supporting MHCV sales is the uptick in mining and the increase in infrastructure spending by the government in FY16/FY17, compared with previous years.

Consistent demand had been witnessed in FY15 and FY16 in the higher tonnage segment of MHCVs (>25T) typically used for long haul - fleet owners seem to be intent on reducing their per ton transportation costs by taking advantage of better road infrastructure in the country. The data compiled by Society of Indian Automotive Manufacturers for June and July 2016 indicates a decline of 9.2% and 24.9% respectively, in this segment in these two months.

The surge in the demand for MHCVs witnessed in the past two years is not corroborated by the Index of Industrial Production which has displayed an inconsistent trend in this period. Growth figures for MHCVs is also not supported by data on foreign direct investments in the country, with the major proportion of investments by FIIs in FY16 having been in the services sector, rather than in manufacturing. In addition, growth in the gross fixed capital formation (which is an indicator of an uptick in economic activity) has been tapering down in the past three years (FY16:3.3%, FY15: 7.9%, FY14: 13.6%). Further, capacity utilisations across industries have not improved, even growth in exports while positive, continue to be tepid. Also freight rates after declining towards the end of FY15 have remained flat in FY16, with a slight increase in certain sectors in the current financial year.

Historically, MHCV sales display a high degree of seasonality, with weak sales in the month of December due to the preference of buyers to purchase vehicles bearing the registration number of the next year (for better pricing in the second hand market), followed by a steady uptick in volumes in the following three months, namely January-March. Sales tend to peak around the month of March every year, as fleet owners increase purchases in Q4 to avail of depreciation benefits and use up their budgets and auto OEMs push sales to their dealers to achieve annual sales targets.

Naturally, the month of April each year registers the lowest sales due to sales peaking in March. However in May, June and July sales volume start their upward trend again. It may be noted that in 2016, the sales volume growth from June onwards has been muted. For June 2016 on a year on year basis, the volume growth slowed to 1.9% compared to the growth of 21% in June 2015, while for July 2016 volumes contracted by 7.6% compared to growth of 30% in July 2015. The agency will be closely monitoring MHCV domestic sales volumes for the next few months, as it believes that a steadily declining trend would possible indicate a reversal of the sales trend in this segment.

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Fitch: Masala Bonds Open Window for India AT1, T2 Bank Capital
Aug 26,2016

Fitch Ratings-Mumbai/Singapore-26 August 2016: The Reserve Bank of Indias (RBI) proposal to allow banks to issue masala bonds - rupee-denominated bonds issued in offshore capital markets - would widen the investor pool and ultimately deepen the market for Additional Tier 1 (AT1) and Tier 2 (T2) bond issuance, says Fitch Ratings. This measure would ease a key constraint for banks in accessing new AT1 and T2 capital, given the limited size of the domestic investor pool relative to the scale of the capital needed. Fitch estimates a capital shortfall of USD90bn over the next several years as Basel III regulatory requirements build from the financial year 2017 (FY17) to FY19.

The RBIs proposal came as part of a series of measures pertaining to Indias fixed-income and currency markets announced on 25 August. Fitch has long maintained that Indian banks would find it challenging to raise sufficient AT1 capital through the domestic markets. This is the case even as most of the capital needed will be required to be denominated in rupee owing to the currency structure of most banks balance sheets. As such, enabling banks to issue masala bonds opens a window to a much larger investment pool while simultaneously addressing the problem of currency mismatches which had existed with previous international bond issues.

The masala bonds market remains in its infancy, however, with the RBIs initial regulatory framework put in place only in September 2015 - and the first issues, by corporates HDFC and NTPC, only completed in July and August, respectively, this year. As such, the extent to which banks will be able to use the masala bonds channel to raise capital remains to be seen, and will depend to a large extent on foreign-investor risk appetite and pricing.

The public banks sharply deteriorating financial profiles over the past two years has raised their standalone credit risks and put their viability ratings under pressure. This in turn is likely to affect overseas investor risk perceptions and their expected risk premium. Furthermore, removing the foreign-currency risk for issuers will still mean that masala bonds will pass this risk on to investors. Weak rupee liquidity in overseas markets will add to the potential currency risk for investors, and raise the expected risk premium.

Therefore, the RBIs proposals have the potential to open up an international investor base to mid- and small-sized banks for the first time, while those firms with weaker credit profiles may find it difficult to use the masala bonds avenue to raise significant new capital.

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RBI decides to enhance the aggregate limit of partial credit enhancement (PCE) provided by banks
Aug 26,2016

The Reserve Bank of India today announced a package of measures for the development of fixed income and currency markets. These measures are intended to further market development, enhance participation, facilitate greater market liquidity and improve communication.

Accepting many of the recommendations of the Khan Committee to develop the corporate bond market, it has been decided to enhance the aggregate limit of partial credit enhancement (PCE) provided by banks, permit brokers in corporate bond repos, authorise the platform for repo in corporate bonds and encourage credit supply for large borrowers through market mechanism. It has also been decided to seek suitable legal amendments to enable the Reserve Bank to accept corporate bonds under Liquidity adjustment Facility (LAF).

To further encourage the overseas Rupee bond market, banks are being permitted to issue Rupee bonds overseas (Masala Bonds) for their capital requirements and for financing infrastructure and affordable housing.

A market making scheme in Government securities by Primary Dealers has been worked out in consultation with the Government which may help in increasing the liquidity of semi-liquid securities. Relaxation of tenor and counterparty restrictions in repo market in G-sec will also help in market liquidity.

Foreign Portfolio Investors (FPIs) will be given direct access to NDS-OM to ease the process of investment in debt securities. It has also been agreed with SEBI to provide FPIs facility to trade directly in corporate bonds.

In a fundamental shift in foreign exchange market regulations, greater leeway is being proposed for residents to maintain open positions. The permissible limits for hedging in the OTC as well as exchange traded markets are also being rationalised. It is also proposed to comprehensively review the framework for hedging of commodity price risk in the overseas markets by Indian companies.

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World Bank Approves $55 Million to Strengthen Nepals Strategic Roads and Bridges
Aug 26,2016

The World Bank approved a credit of US$ 55 million for the Government of Nepal to scale up its Road Sector Development Program and address post-earthquake reconstruction needs, including the strengthening of the countrys strategic road and bridge network to withstand future seismic and climate vulnerabilities.

The additional financing will top up World Bank support to the Roads Sector Development Project (RSDP) which has been ongoing since 2008. When it began, the project intended to provide residents in 10 beneficiary districts, including the poorest, in the mid-western and far-western regions of Nepal with all-season road connectivity, reduced travel time, and improvements in access to economic centers and social services. With the additional financing, 25 more districts stand to benefit from the maintenance of earthquake-affected bridges. The original 10 districts will also continue to benefit from road upgrading, slope stabilization and bridge works.

n++The Road Sector Development Project has been the cornerstone of our support to Nepals strategic roads network for nearly a decade,n++ said Takuya Kamata, World Bank Country Manager for Nepal. n++While the primary focus has been to develop connectivity in the poorest and remotest regions of the country, the 2015 earthquakes highlighted the need to improve the resilience of key roads and bridges to future natural shocks.n++

RSDP currently serves a population of 2 million in 10 districts in the mid-western and far-western regions of Nepal. The project will serve another 10.2 million Nepalis following the maintenance of earthquake affected bridges in the 25 additional districts. The bridges that will undergo maintenance in these districts provide connectivity along the Birgunj-Narayanghat-Mugling-Kathmandu corridor which carries the vast majority of freight into and out of Kathmandu and Pokhara. This corridor is among Nepals most vital infrastructure assets for supporting economic growth and development.

n++Nepals hills and mountains are susceptible to extreme precipitation, earthquake, and landslides that can result in severed connectivity, loss of life, and damage to property,n++ said Farhad Ahmed, Task Team Leader for the project. n++Robust construction, better maintenance and improvements in the capacity to respond will help Nepal adapt to unforeseen events.n++

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India registers 350% rise in cybercrime in three years: ASSOCHAM-PwC study
Aug 26,2016

In India, there has been a surge of approximately 350% in cybercrime cases registered under the Information Technology (IT) Act, 2000 from the year of 2011 to 2014, a recent ASSOCHAM-PwC joint study said today.

The Indian Computer Emergency Response Team (CERT-In) has also reported a surge in the number of incidents handled by it, with close to 50,000 security incidents in 2015,n++ noted the study titled Protecting interconnected systems in the cyber era, conducted by The Associated Chambers of Commerce and Industry of India (ASSOCHAM) jointly with PwC.

The study highlighted that Operational systems are increasingly subject to cyber-attacks, as many are built around legacy technologies with weaker protocols that are inherently more vulnerable. The continued and regular sharing of cyber security intelligence and insights is essential to improving the resiliency of these systems and processes from emerging cyber risks.

n++Cyber-attacks around the world are occurring at a greater frequency and intensity. Not only individuals but also businesses and governments are being targeted. The profile and motivation of cyber attackers are fast changingn++, highlighted the joint study.

With an increase in the usage of information and operational technology (OT) and consumer technology (CT) in critical infrastructure, overall effectiveness has increased. However, these elements have also become the target of choice for attackers since they recognise the impact of disrupting the routine way of life. Attackers can gain control of vital systems such as nuclear plants, railways, transportation or hospitals that can subsequently lead to dire consequences such as power failures, water pollution or floods, disruption of transportation systems and loss of life, noted the study.

In the US alone, there has been an increase of nearly 50% in reported cyber incidents against its critical infrastructure from 2012 to 2015, adds the paper.

Cyber-attacks around the world are occurring at a greater frequency and intensity. Not only individuals but also businesses and governments are being targeted. The profile and motivation of cyber attackers are fast changing. A new breed of cybercriminals has now emerged, whose main aim is not just financial gains but also causing distruption and chaos to businesses in particular and the nation at large.

The National Critical Information Infrastructure Protection Centre (NCIIPC) has been identified as the nodal agency under the National Technical Research Organisation for the protection of critical information infrastructure. The formal roles and responsibilities of NCIIPC include cooperation strategies, issuing guidelines, advisories and coordination with CERTIn. NCIIPC has defined controls for the critical infrastructure sectorsn++power and energy; banking, financial services and insurance (BFSI); ICT; transportation; and e-governance and strategic public enterprises.

The continuous research and development can help in capacity building and coming up with effective solutions, adds the study. A cross-sector knowledge database inclusive of all the past incidents and threats needs to be maintained and analysed to strengthen protection measures.

Relevant, properly configured technology Investment in the right technology is another key characteristic of resilient OT and CT networks. Using the right detection, prevention, monitoring and reporting tools will help organisations to prevent attacks and facilitate informed decision-making in relation to possible cyber security threats.

A strong collaboration between well-equipped IT, OT and CT teams is also necessary for a unified approach to risk management and incident response. Monitoring OT and CT must be brought under the ambit of security monitoring, as in the case for IT networks. The periodic monitoring programme should include log monitoring, vulnerability assessments and audits of these interconnected systems. Central monitoring through nodal bodies will help in institutionalising the efforts.

With regard to security incidents in critical infrastructure, organised efforts are required to reduce the potential cascading impact and response time. Incident response for critical infrastructures requires a partnership between public and private organisations to perform analysis, issue early warnings and coordinate response efforts.

Accordingly, they should build a forward-looking cyber security programme that is based on the right balance of technologies, processes and people skillsn++all supplemented with an ample measure of innovation. With these components in place, organisations are likely to be better prepared for the future of cyber security.

The study revealed that in the past attacks have been mostly initiated from the countries such as US, Turkey, China, Brazil, Pakistan, Algeria, Turkey, Europe, and the UAE, and with the growing adoption of internet and smartphone India has emerged as one of the most favorite countries among cyber criminals.

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Traditional Cable Companies Attract Subscribers with the Launch of OTT Services
Aug 25,2016

Traditional cable companies are joining the bandwagon by launching their own OTT (over the top) content to cash in on the buzz in the digital space and tap a new revenue stream, says India Ratings and Research (Ind-Ra). The market which these cable companies are trying to tap is growing at a fast pace, as per the Telecom Regulatory Authority of India total wireless telecom subscribers stood at 1.06bn and broadband subscribers at 159m as of end-May 2016. As per the Cellular Operators Association of India, the number of 3G users in India are expected to more than double (to 330m) and 4G to grow by over 10 times (to 42m) from 2015 base till 2017.

In fact the Frost and Sullivan (Feb 2016) market insight on the OTT video market in India finds that there are about 66m unique connected video viewers in India every month, and about 1.3m OTT paid video subscribers.

In broadcasting, OTT is the delivery of audio, video, and other media over the internet, without the need of a cable subscription from a Multiple-System Operator (MSO) who is usually in the control of distribution of the content. In light of competition from independent OTT content producers/aggregators (namely Netflix, Eros Now, Spuul) and broadcasters with OTT services (namely Ditto TV, Hot Star, Voot ) and the industry wide shift of consumers towards consuming digital content, traditional cable companies are setting up their own OTT services.

Certain MSOs namely Asianet Satellite Communications Limited (Asianet: IND A-/Stable, first MSO to launch) has launched an OTT service called Asianet Mobile TV+ for streaming Malayalam among other regional TV channels. This enables the company to expand its geographical reach, enable non-linear/on-demand consumption and offer the opportunity to cross-sell/bundle its broadband services. Asianet had a broadband subscriber base of 167,000 at end-FY16. Hathway Cable & Datacom Ltd (IND A-/Negative) is expected to launch its OTT soon. The agency expects other MSOs to also follow suit, in order to keep up with this shift in consumption pattern.

Among the large players, broadband subscribers grew in FY16 for Hathway Cable & Datacom to 627,200 from 455,800 in FY15, DEN Networks Limited to 95,000 from 23,000 and SITI Cable Network Limited to 132,000 from 60,000 showing the growth in broadband penetration. Players may try to bundle OTT services with their broadband services to create a bouquet offering.

The entry strategy for MSOs launching OTT is to grab subscribers initially and monetise later. Some players in the media value chain are offering OTT free or at prices as low as INR20/month. Even for the yet to be launched OTT services, Ind-Ra expects these services to be free initially to develop a user base and then move to a subscription based service with gradual price increases. Eventually players will move to tap advertisement revenues using consumer demographics/analytics. Currently, the eco-system is still evolving with various intermediaries in the value chain offering digital services. The next leap forward for the industry will be post the introduction of better 4G data services by telecommunication service providers which will enable wire-less and on the go streaming.

The initial investment by MSO players who have already launched OTT services isnt substantial and is not expected to be sizable for the MSOs in FY17, nor is the revenue stream significant. This could however be a hedging opportunity for cable operators with broadband presence, since now content owners can reach the consumer directly. The rush to encash on the digital frenzy is pushing MSOs to experiment, but the consumer is likely to choose the OTT provider based on- the availability of a variety of content, end-user experience and price point.

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FICCI welcomes Department of Pharmaceuticals move towards broadbased stakeholder consultations
Aug 25,2016

The Department of Pharmaceuticals has involved hospitals and eminent clinicians, both from the Government and Private sectors in the important discussion on price control of coronary stents.

In this discussion on the subject of coronary stents inclusion in NLEM (National List of Essential Medicine), several reputed clinicians emphasized on the fact that all Drug Eluting Stents (DES) cannot be considered the same. There is sufficient clinical evidence that generational improvements in DES through incremental innovation has resulted in improved patient outcomes in the form of reduced rate of thrombosis and restenosis reduction for instance, in addition to ease of deliverability thus improving overall safety and efficacy. The suggestion that all DES is similar puts Indian patients and medical care in significant quality disadvantage.

The reputed clinicians experts present in the meeting have recommended to the Government to consider a DES classification norm through a matrix that involves such key performance parameters as:

a. Type of drug

b. Type of alloy

c. Strut thickness

d. Polymer profile

e. Deliverability / Trackability

f. Published safety & efficacy outcome data in publications of minimum impact factor of 2

g. Global regulatory approvals

There was consensus amongst Clinicians, Government and Industry that an appropriate Scoring Matrix, with critical patient safety and efficacy parameters, should be designed to determine DES classification. Industry has requested the Government to follow up through a multi stakeholder determination workshop, involving reputed clinicians, to design the matrix before Government activates the pricing mechanism for stents in NLEM.

FICCI, which has always maintained that all DES cannot be considered same and submitted extensive evidence of that to the NLEM Expert Committee in the past, welcomes the Department of Pharmaceuticals latest move towards a science, safety and efficacy based DES price determination process.

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Cabinet approves Nine projects worth Rs. 24,374.86 crore in Nine States
Aug 25,2016

Big boost to rail network

In a major push to give a boost to the infrastructure sector in the country, the Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri Narendra Modi, has given its approval for nine projects worth Rs. 24,374.86 crore in nine States for expansion of railway network and connectivity across the country.

S.No.StatesProjectLength

(kms)

Expenditure

(in crores)

1AssamConstruction of 2nd railway line between New Bongaigaon and Kamakhya1762586.852JharkhandConstruction 3rd line between Kharagpur (Nimpura) and Adityapur1321483.363Chhattisgarh and MaharashtraConstruction of 3rd line between Rajnandgaon-Nagpur (Kalumna)in Rajnandgaon district of Chhattisgarh and Gondia, Bhandara and Nagpur districts in Maharashtra228.32,193.534Uttar Pradesh and Madhya PradeshConstruction of 3rd line between Mathura and Jhansi

 

Construction of 3rd line between Jhansi and Bina

273.80

 

 

152.57

4,377.13

 

 

2,273.84

5Madhya Pradesh and MaharashtraConstruction of 3rd line between Itarsi and Nagpur280 km2,882.946Telangana and MaharashtraConstruction of 3rd line between Ballarshah and Kazipet201.042,403.227Andhra PradeshConstruction of 3rd line between Vijaywada and Gudur287.673,875.688Odisha and ChhattisgarhConstruction of 4th line between Jharsuguda and Bilaspur2062,298.31                      TOTAL - Nine projects1,937.3824,374.86

Besides facilitating the travel by easing the traffic bottlenecks, the approved lines would help the upcoming industries in the region and additional transport capacity to meet their requirements.

The goods trains supplying foodgrains from one region to another, various industries, mines, coal fields and power plants will have additional transport capacity through these lines resulting in more revenues to Indian Railways.

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Real Estate Regulation Act will reduce litigation, boost FDI flows & ensure timely project delivery: FICCI-Grant Thornton Report
Aug 25,2016

The FICCI Grant Thornton Report, Real Estate Regulation Act, 2016 (RERA) - Are we ready? a survey-based Report, reveals that a majority of the respondents are of the view that RERA will bring transparency and authority in doing real estate dealings and hence will reduce the litigations going forward. They also felt that RERA will boost the governance hold on the sector. This will eventually lead to increase in Foreign Domestic Investments (FDI) into the sector in near future. This will also improve the ease of availability of financing options in the market. A major outcome of the survey is that industry feels that the rule of depositing 70% of sales proceeds in a separate account will help in getting timely delivery of the project and eliminate fly-by-night operators in the real estate.

The report states that under RERA, the developers might need some time to get used to its provisions and complexity of its rules. The move by the developers to comply by the provisions of RERA might push prices upwards in the short-term. But one can expect stabilization due to the efficiencies brought in by the RERA. It will not only help in expediting the completion of the on-going projects but also immunize buyers from any fraudulent practices. The RBI has maintained status-quo on the interest rates allowing prospective homebuyers to avail cheaper home loans. Developers are now expecting more Foreign Direct Investment to flow in to the sector, thus creating more job opportunities and revitalizing the growth of the sector.

While various international markets have varying types of regulations, the sector is optimistic that the RERA is a perfect cut to solve the issues plaguing the Indian Real Estate Sector. Based on the responses and the interpretations drawn, one can conclude that the sector has given a thumbs up to RERA.

The real estate sector plays a catalytic role in fulfilling the need and demand for housing and infrastructure in the country. While this sector has grown significantly in recent years, it has been largely unregulated. There is, thus, absence of professionalism, standardization and lack of adequate consumer protection. Though the Consumer Protection Act, 1986 is available as a forum to the buyers in the real estate market, the recourse is only curative and is inadequate to address all the concerns of buyers and promoters in that sector. The lack of standardization has been a constraint to the healthy and orderly growth of the industry. Therefore, the need for regulating the sector has been emphasized on various forums, the report points out.

The following are the highlights of the report:

Close to 65% of the respondents feel that, going forward, transparency will increase in real estate dealings.

Close to 60% of the respondents feel that RERA will increase the governance hold in the sector and lead to increased investments.

Approximately 50% of the respondents hope that the lending options from lenders will improve and availing finance will be easier.

Close to 40% of the respondents feel that the implementation of RERA will help timely delivery of projects and also eliminate non- serious players from the sector.

More than 40% of the respondents believe that maximum impact will be in the area of project planning and construction.

The report recommends that the compliance of this Act should not become one more layer of approvals to be obtained, but to ease out the entire approval process. The Act should also consider the impact of transmission issues and make it more pragmatic for the developers to comply at the end given the importance and contribution of real estate once feel that the current way of reforms should continue.

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Indian mobile tower firms set to increase tenancy ratios by 2.9 by 2020: ASSOCHAM-KPMG study
Aug 25,2016

Due to the expansion of 3G and onset of 4G technologies, telecom tower industrys tenancy ratios will increase to 2.9 times by March 2020 from 1.95 times as of March 2015, according to an ASSOCHAM-KPMG joint study.

Tenancy ratio refers to the number of tenants (operators) who have put up their antennae and other active infrastructure on the towers. Increase in tenancy ratios has been the key growth driver for tower companies in India, reveals the ASSOCHAM-KPMG joint study.

Growth in telecom sector has helped India emerge as a trendsetter in the tower infrastructure segment. Around 70 per cent of Indias 4,00,000 towers are owned and operated by the tower companies. Advent of new technologies, such as 4G by Telecom Service Providers (TSPs), along with expansion in the rural areas are expected to be key drivers for the telecom infrastructure industry over the next five years.

Rapid growth in the sector has also prompted tower companies to invest heavily in capex. The aggregate capex spend increased from INR 8,000 crore in 2013-14 to INR 10,200 crore in 2014-15. Net tower additions were also significantly higher at about 6,300 in 2014-15 vis-n++-vis 3,200 in 2013-14. One of the key emerging trends in the last few years is emergence of towers running on green energy. In line with the trend, 15 per cent of the total capex spends were incurred by towers running on green energy, noted the study.

n++India has been the most preferred destination for investment in the tower sector in the Asia. Since 2008, seven out of the top 20 deals in Asia in tower sector have originated in India. More than 84,000 towers have exchanged hands in India since 2008 (which represent 84 per cent of the total towers sold in top 20 deals in whole of Asia during the period). Deals amounting to INR 40,367 crore have been finalized during this periodn++, said Mr. Sunil Kanoria President ASSOCHAM while releasing the study.

Telecom tower companies are currently facing multiple fees and levies, in the form of installation fee, annual renewal fee, sharing fees etc. The applicable fee structures vary across states and local bodies. In addition to this, deposits and bank guarantees are also required for tower installation in some geographies. Multiple fees being levied contribute towards higher costs of services for the telecom service providers, and in turn, to the subscribers.

The DoT guidelines for tower installation stipulate only a one-time fee which the states may levy to recover administrative costs for issuing the permission. These guidelines should be uniformly implemented across states to ease the financial burden on the industry.

Continuous power supply to tower companies is critical in order to ensure smooth connectivity with reduced outages. Further, absence of electricity supply also leads to increased diesel consumption, which in turn increases the operating costs as well as carbon emissions.

Telecom tower companies continue to face challenges with respect to obtaining electricity connections, especially in rural and remote areas. Further, in many cases, grid supply is unable to meet the power requirements of the sites.

While the government has recognised telecom towers as an infrastructure industry, it is imperative to provide electricity connections on priority and on preferential tariffs, in order to ensure that the industry achieves its potential.

Tax holiday under Section 80IA should be extended to tower companies to provide impetus for development and growth of telecom infrastructure in the country.

One of the critical and contentious issue is the refusal of CENVAT credit on goods used for mobile towers and its parts used for providing telecommunication service. CENVAT credit has been denied on the grounds that the goods under consideration neither qualify as capital goods nor inputs under the credit provisions. Accordingly, due to the factor of immovability in goods, there is ambiguity with respect to availing such credit.

In view of the above, it is recommended that eligibility of CENVAT credit on towers to telecom service providers should be clarified.

Telecom service providers together grossed INR 177,500 crore revenue in 2014-2015, which is up from INR 146,700 Crore in 2012-13. India is the second largest mobile market with over a billion subscribers at the end of Feb 2016, with 608.4 million urban subscribers and 443.5 million rural subscribers. There is a huge potential to grow in the rural sector where tele-density is still quite low at 50.76 as compared to urban tele-density at 153.93.03. While the mobile subscriber base is still growing by under one per cent on a monthly basis, the number of landlines is gradually decreasing. Overall telecom density increased to 82.9 per cent by the end of Feb16.

Moreover, the Government of India has recently drawn a road map to develop 100 smart cities in the country to which the telecom service providers are set to form the backbone and will be vital to their sustainability.

Indian telecom sector has undergone significant transformation over the last two decades to become the second largest telecommunication market in the world. The sector is strategically important to the country since it contributes approximately 6.1 per cent to Indian GDP, provides nearly 4.2 million job opportunities and is among the highest contributors to FDI in India.

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Cabinet approves MoU with Myanmar for cooperation in the field of Traditional Systems of Medicine
Aug 25,2016

The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has given its approval for the signing of a Memorandum of Understanding (MoU) between India and Myanmar in the field of Traditional Systems of Medicine.

The MoU will provide structured frame work for cooperation between the two countries for promotion of AYUSH/Traditional Systems of Medicine in Myanmar. It will boost the importance of AYUSH systems of medicine and conservation, production and standardisation.

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Cabinet approves construction of second line between New Bongaigaon and Kamakhya of Northeast Frontier Railway in Assam
Aug 25,2016

The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri Narendra Modi, has given its approval for construction of second line between New Bongaigaon and Kamakhya of Northeast Frontier Railway in Assam at an estimated cost of Rs.2,232.32 crore and expected completion cost of Rs.2,586.85 crore.

The 176 km long railway line is expected to be completed in five years during 12th and 13th Plan period.

Besides facilitating the travel, upcoming industries in the region will have additional transport capacity to meet their requirements.

Background:

The single main line section from New Bongaigaon to Kamakhya via Goalpara is an alternative route to New Bongaigaon-Kamakhya via Rangiya linking Guwahati. The line capacity utilization of the BG single line section has already over-saturated. Most of Gauge conversion projects in NE Region have been commissioned and work on Bogibeel Bridge is being expedited. With the commissioning of Bogibeel Bridge, traffic in the project section will increase manifold. Thus, doubling of New Bongaigaon-Kamakhya via Goalpara would augment its line capacity for smooth running of trains through the section.

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Cabinet approves Agreement and the Protocol between India and Cyprus for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion
Aug 25,2016

India, took another major step in the fight against tax evasion, round tripping and base erosion/profit shifting. The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has given its approval for signing of an Agreement and the Protocol between the India and Cyprus for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income.

This step follows the recent amendment of the Double Taxation Avoidance Agreement with Mauritius. As in the case of Mauritius, the treaty with Cyprus had provided for residence-based taxation of capital gains. With the revision of the treaty now approved by the Cabinet, capital gains will be taxed in India for entities resident in Cyprus, subject to double tax relief. In other words, India will have the right to tax capital gains arising in India. The provisions in the earlier treaty for residence-based taxation were leading to distortion of financial and real investment flows by artificial diversion of various investments from their true countries of origin, for the sake of avoiding tax. As in the case of Mauritius, this amendment will deter such activities. Negotiations with Singapore are also underway for similar changes.

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Cabinet approves National Highways Interconnectivity Improvement Project
Aug 25,2016

The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri Narendra Modi, has given its approval for development of 1120 kms of National Highways in the States of Karnataka, Odisha, Bihar, Rajasthan and West Bengal.

The work for development to two lane standards are under Phase-I of the National Highways Interconnectivity Improvement Project (NHIIP) with World Bank assistance.

The revised estimated cost is Rs. 6,461 crore including cost of land acquisition, resettlement and rehabilitation and other pre-construction activities.

The projects are already taken up for implementation and 429 kms has been completed. The civil works are expected to be completed by July, 2019 and maintenance works are expected to be completed by July, 2024.

The project will ensure safe, fast and all weather movement of traffic on the proposed National Highways mostly located in backward regions thereby improving socio economic development.

Background:

The proposal was initially approved for Rs.5,193 crore. The cost has increased due to higher bid prices, and increase in cost of land acquisition, resettlement and rehabilitation and other pre-construction activities.

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