The Index of Industrial Production grew 2.4% in January 2013, rebounding from declines in the previous two months. Manufacturing activity and electricity production increased. Wholesale price inflation rose to 6.8% in February due to fuel prices, while core inflation declined. India's current account deficit reached a record high of 6.7% of GDP due to a widening trade deficit. A new policy is expected to boost investment in urea production.

1. India Newsletter
April, 2013
IIP GROWTH % (INDEX OF INDUSTRIAL PRODUCTION) ECONOMIC AND POLITICAL NEWS
12
The Index of Industrial Production (IIP), in
10 9.5 January 2013 improved to 2.4% yoy as
8
8.3 compared to de-growth of 0.5% yoy in
6.2 6 December 2012 and 1.0% yoy growth in
6 5.3 January 2012. The rebound in IIP growth, after
3.7 4.1 two straight months of contraction, can be
4 3.4
2.5 2.7 2.5 2.3 2.4 attributed to a pick-up in manufacturing
2
activity and electricity production. The
-0.4 -0.6 -0.5
0 1.1 -1.3 Manufacturing sector, reported a 2.7% yoy
-2 0.2
growth during the month aided by a low base
-2
-3.5 effect as compared to a growth of 1.1% yoy in
-4 -5 January 2012 with 11 of the 22 industry
-6 groups in manufacturing registering a positive
growth.
Wholesale Price Index (WPI) inflation for
February 2013 edged up to 6.8% as compared
WPI % GROWTH (WHOLESALE PRICE INDEX) to 6.6% yoy in the previous month, rising by
0.6% mom largely driven by the rise in fuel
9 index (3.0% mom). Core inflation receded for
8 8.1
8 7.6 7.6 7.5 the sixth straight month to 3.8% yoy as
7.4 7.2 7.3 7.3
6.9 6.9 7.2 compared to 4.1% yoy in the previous month,
6.8
7 6.6
reflecting the decline in commodity prices and
6 weak pricing power.
5 India's current account deficit (CAD hit a
record high of 6.7 percent of GDP in the last
4
quarter (Oct-Dec’12). The current account
3 deficit has widened to $32.63 billion in the
2 three months through December, compared
to $22.3 billion in the September quarter.
1
India's current account deficit at 6.7% is the
0 highest in the last 5 years. It was 4.3% a year
JAN'12 FEB'12 MAR'12 APR'12 MAY'12 JUNE'12 JULY'12 AUG'12 SEP'12 OCT'12 NOV'12 DEC'12 JAN'13 FEB'13
ago and 5.4% in the previous quarter.
New Urea Investment Policy to boost
QTRLY GDP GROWTH TRENDS% expansion plan the recently approved New
Urea Policy is likely to encourage fertilizer
10 companies to set up new plants and expand
9.2
9 8.5
existing capacities, thereby reducing
8.2 8 dependence on imports. India currently
8 7.6
imports ~30% of its urea requirement
6.7
7 Passenger Car volumes down 26% YoY for
6.1
6 5.3 5.5
5.3 Feb’13 but growth momentum in Utility
5 4.5 Vehicles continues. Weakness continues in
Commercial Vehicle segment; down 11% YoY
4
in February ‘13. Domestic Two-Wheeler
3 volumes down 2.8% with all sub-segments
2 showing weak growth. Three-Wheeler
(passenger) segment benefits from fresh
1
permits, registers 7% YoY growth
0
1QY11 2QY11 3QY11 4QY11 1QY12 2QY12 3QY12 4QY12 1QY13 2QY13 3Qy13

2. ECONOMIC AND POLITICAL NEWS Import Export Growth Trend %
70
Gas pricing policy to be reviewed, uncertainties Export Import
60
removed: FM
Govt plans to ease, scrap FDI sectoral limits 50
Government to cut subsidies outgo to 1.5% of 40
GDP by FY2017
30
Government plans to set up National Power
Committee 20
FDI inflow in Bangalore around US$9.3bn in last 10
10 years
0
RBI (Reserve Bank of India) cuts repo rate by May'11 June'11 Jul'11 Aug'11 Sep'11 Oct'11 Nov'11 Dec'11 Jan'12 Feb'12 Mar'12 Apr'12 May'12 June'12 Jul'12 Aug'12 Sep'12 Oct'12 Nov'12 Dec'12 Jan'13 Feb'13
th
25basis points to 7.5% on 19 March -10
Financial inclusion plan key criteria for new bank -20
license: RBI
Loans to PPP infra projects to be treated as
secure loans: RBI
INDUSTRY AND CORPORATE NEWS
Budget 'realistic', positive for ratings, says
Moody's Strides Arcolab finally sells speciality arm to Mylan for US$1.6bn
Current account deficit biggest concern: Chief Cipla plans US$512mn takeover of South Africa's Cipla Medpro
Economic Adviser Alembic Pharma gets US nod for antidepressant tablets
High inflation prompting more gold buys: RBI Dr Reddy's launches anti-SRE drug in US
Share of exports in India's overall GDP rises to Coal India sets 492 MT production target for FY2014
17.7% in FY12 Coal India to set up ` 9,000cr (nearly 1.6 bln US$) power plant in Odisha
India will grow at 6% next year: World Bank Mahindra bets on maiden e-car launch
Delinking of environment and forest clearances ONGC (Oil & Natural Gas Corporation), Oil India may bid for Mozambique gas stake
gets Supreme Court nod ONGC-led consortium to study feasibility of Mangalore LNG terminal
World Bank to lend $5 bn for poverty ONGC (Oil & natural Gas Commission) ties up with BPCL (Bharat Petroleum Corporation Ltd) ,
eradication Mitsui to set up LNG terminal at Mangalore
Indirect tax collections rise by 20% in Apr-Feb 4,000 MW Mundra UMPP (Ultra Mega Power Project) fully operational: Tata Power
Foodgrain output likely to dip 3.5% to 250MT in RCF (Rashtriya Chemical Fertilizer) & SAIL (Steel Authority of India Ltd) stake sale offer done
FY2013 RIL(Reliance Industry Limited) teams up with Samsung, plans 4G phones for 5.5k INR.
India, Africa revise 2015 trade target upwards to GVK, Aurizon to develop Oz basin infrastructure
US$100bn Viacom to buy TV18's residual stake in ETV's regional play
India's 2013-14 total food subsidy stands at Rajasthan Government, HPCL tie-up for `37,230cr (nearly US$7 bln) refinery
`1,30,000cr (nearly 25 bln US$) JSW steel to raise US$600mn from overseas markets in next quarter
FDI up 8% at US$2.2bn in January, 2013 Infosys expands footprint in Latin America, opens delivery center in Costa Rica
India to install 1300-1400 MW solar power in NMDC (National Mineral development Corporation) eyes `10,000cr (US$1.8 bln US$) from
2013 stake sale in Nagarnar plant
Outbound deals of Indian companies at Bharti Airtel launches 4G services in Chandigarh, Mohali and Panchkula
US$11bn in 2012 Apollo Global Management to sell 11% stake in Dish TV
Telcos need `90,000cr capex (nearly 18 bln US$) MRPL retracts Haldia PetChem buyout plan
for 100% teledensity in villages by 2020: E&Y AAI (Airport Authority of India) to release deregistered KFA (Kingfisher Airlines) planes after
Assocham government nod
Electrical equipment industry sees 11% fall in Ashok Leyland sells stake worth `216cr (nearly 40mln US$) in IndusInd Bank
revenue Hindalco, Vedanta in race to buy Rio Tinto's Iron Ore Company
Fertiliser subsidy payment of `31,580cr (nearly RIL to give up 4,266 sq km of KG-D6 block
5.6 bln US$) may remain outstanding Amtek close to buying German company Neumayer Tekfor
Textiles Min asks firms to invest in technical GMR may sell 5-star hotel at Hyderabad airport
textiles Wipro launches new platform for healthcare providers
FIPB clears 12 FDI proposals worth `2,600cr Visa Steel forms JV with SunCoke Energy
(nearly 480 mln US$)
Asian Paints to acquire 51% stake in Sleek
Food processing sector got `6,198cr (nearly
Credit Suisse buys 1.56% stake in Emami for `141cr (nearly 26 mln US$)
1.2bln US$) FDI in less than 3 yrs
Investing in India to secure future growth; Panasonic Corp
Gujarat govt to develop India's first L&T to buy 50% in Future Generali Insurance
International Financial Services Centre Educomp Solutions sells its entire 50% stake in Eurokids
Nalco, Mines Ministry inks MoU for higher production, sales
DISCLAIMER
MAJOR UPCOMING EVENTS
This report is solely for knowledge purposes. The information contained here has been
1. April 10- Import export Data 2. April 12- Industrial Production YoY
obtained from sources which Expand In India believes to be reliable. The Company does not
3. April 15- Monthly Wholesale Prices 4. Start of Corporate Results Announcements warrant that such information is accurate or complete.
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