18.01.2008

• Medicine pricing; some reform in the offing
• The NPPA (National Pharmaceutical Pricing Authority) is planning to introduce what it calls pro rata pricing. It means that once the price of a strip of ten 100 mg tablets is fixed, a corresponding price will be applicable to all other strengths and packs even if no price is fixed for them.
• So far manufacturers are having a heyday by tinkering with pack size to defeat the price caps fixed for medicines.
• At present, price is fixed for a certain pack or strength. For a different strength or pack, the price fixed is not applicable and it takes months before NPPA can fix the price for a new pack. This is what is sought to be plugged with the proposed move.
• India destroys 93% of its chemical weapons stock
• India is on the path to destroy all of its chemical weapons by April next year.
• Mobile TV to make an entry soon
• Mobile TV refers to serving TV content on mobile phones.
• TRAI has made its recommendations concerning usage and allocation of spectrum bands, method of beaming content, details of licences like fees and validity command area of these licences and eligibility criteria.
• US team clones human embryo
• A small California based company – Stemagen has reportedly succeeded in cloning human embryo.
• Their success included making five early stage embryos (called blastocysts) from donated human eggs and skin cells from two men.
• Stem cells, you might recall, are found throughout the body, renewing tissue and blood cells. Cells taken from very early human embryos can give rise to all the cells and tissues found in the human body. Scientists hope to harness their power to transform medicine, to repair devastating injuries, replace the brain cells lost in Parkinson’s disease, or to cure juvenile diabetes.
• Take a look at what we noted about stem cells earlier in our blog.
• Why is our textile sector more rupee-hit?
• It is a very good article that appeared in today’s ET. Take a look at it here. Some quick bullet points for us to remember from this:
• Structural weakness – i.e., poor and inadequate weaving and processing capacities. This restricts its strengths to only a few areas – yarn and casual/fashion wear garments.
• Its competence in mass consumption (regular wear) garments also is very restricted. So its ability to compete in times like these is limited to 40% of the markets.
• The TUFS scheme was used to add new spindle capacities rather than fabric making capacity.
• The discriminatory tax regime that was in place has discouraged setting up of new weaving units in the organized sector. Small weavers were exempted from excise duty while the organized big players had to pay the same. This stunted the growth of the organized sector.
• A bit about our wooden shipping industry
• India has a 200 year history of making wooden ships. Now there is a surge in demand for wooden ships; thanks to the demand from Gulf countries. They are using these ships to carry livestock, mainly meant for meat.
• This industry is centered around two small ports in Gujarat – Mandvi and Salaya. Locally it is called Vahanvatti.
• The cost of such ships varies from Rs. 1 crore to 5 crores based on tonnage and size. These have a life of about 30 years.
• These ships get their required clearances from the ministry of commerce; and not from the DGS (Director General of Shipping) as they are considered as country class cargo vessels.
• What suggestions can you give for tackling the high volatility seen on the very first day of listing of IPOs?
• Here are some good suggestions from today’s ET editorial.
• Institutional investors should also be mandated to put the full application money, like retail investors, and not just the 10% margin. This small margin requirement, coupled with a proportionate allotment system leads to over-bidding, creating an impression of large demand.
• Whether or not price bands are required is worth a debate. Instead of price bands, if a system of open bidding in the institutional segment is put in place, it may help better price discovery. The price so discovered can be used to allot the retail portion.
• When economists (or the more widely read people) speak of demand side measures in an economy, what exactly are they referring to?
• In today’s article by Jaideep Mishra, he outlines some of them.
• A reduction in indirect taxes (that is, lower excise duty) will boost off take of consumer durables.
• Lowering of interest rates by the central bank. This will push up consumer demand.
• A competitive exchange rate that will not disincentivise manufacturing and production.
• A good critique about the SEZ policy
• It is a very good article written by two IIM students. Take a look at it. It is worth a read.