24.10.2008

• India may allow UK law firms to set up shop
• INDIA may allow UK-based law firms to practise here, provided the UK government permits their Indian counterparts to obtain work visas in the legal space there. This would come as a breather to UK-based law majors.
• The move would be path-breaking, as the Bar Council of India (BCI), which has been against allowing market access in the legal domain, has backed the proposal. Sources said the BCI has indicated that it may consider the matter on a country-specific basis, provided there is a quid pro quo arrangement. Both the UK and Indian governments are keen to pave the way for two-way movement of legal eagles. Once an agreement is finalised with the UK, the BCI may be urged to open the gates for other countries too on a reciprocal basis.
• What are the strategies and policy actions that are needed to strengthen manufacturing sector in the current financial turmoil?
  
• Look at the following suggestions from the National Manufacturing Competitive Council headed by V. Krishnamurthy:
• First, the repo rate could be cut further by another 50 basis points to 7.5%, as cost of credit has been impacting the growth and investment prospects of the manufacturing sector.
  
• Second, the CRR could be brought back to the levels of 5% as it was 18 months ago. This would be particularly useful to meet the rollover and credit demand for the next six months, which is likely to be $40 billion.
  
• Third, there is the need to shield the most vulnerable in the industry — the SME sector. A corpus may be set up for lending to SMEs, as they will be disproportionately hurt by the non-availability of credit.
  
• Fourth, to assist exporters, EXIM Bank could be allowed to borrow foreign exchange from the Reserve Bank out of the foreign exchange reserves as is done in Korea and China.
  
• Fifth, this is the opportune time to relax the FDI caps, in sectors like insurance to help increase flow of foreign exchange.
  
• Sixth, removal of the caps on NRE and FCNR(B) deposits could also help shore up foreign exchange liquidity.
  
• And finally, a fund could be set up to inject some buoyancy and depth in the Indian capital markets, so that manufacturing companies looking to raise capital can do so effectively. The fund could be from the RBI’s own forex reserves where $7-8 billion could be set aside to invest in Indian assets in the market.
• Fall in crude prices revives the clamour for reducing petro prices
• While crude prices have slid to about $61 per barrel now from a high of $147 per barrel in July, the fact is that our Oil Marketing Companies (OMCs) still make humungous losses on sale of petro prodcuts. In addition to this, the rupee has depreciated by about 25%, effectively offsetting the benefit of the drop in crude oil prices.
  
• According to public sector OMCs, they are still losing Rs 2.41 per litre on petrol, Rs 6.42 per litre on diesel, Rs 28.07 per litre on PDS kerosene and Rs 332.14 per cylinder on LPG.
  
• According to the revised estimate, OMCs’ total under-recovery — losses due to selling fuel below cost — would be Rs 1,47,486 crore in 2008-09.
• "True Colours" and Monkeygate affair
• What are these? Sports fans -- especially the cricket lovers -- might know about them.
• True Colours is the autobiography of Adam Gilchrist, former wicket keeper of Australia.
• Monkeygate affair refers to the incident wherein Harbhajan Singh was accused of using racial slurs during the Sydney Test.
• The negative comments made by Gilchrist in his autobiography against Sachin Tendulkar can make the book controversial and perhaps ensure its commercial success.