India's monsoon rains were 9.0 per cent below normal in the week to June 15, the weather office said on Thursday, with rice and cotton growing regions in the south and east suffering the lowest rainfall.The June-September monsoon is in the early stages and crops are not greatly affected by the quantity of rains now. What is key is the distribution of rainfall in mid-July after the monsoon covers the entire country.Last year, which saw a normal monsoon, the rainfall was below normal in the week ending June 16.In the previous week this year, the monsoon was 16 per cent above average with heavy rains in the tea, rubber, coffee and corn growing areas of southern India, and rice, cane and cotton areas in the west.The monsoon, vital for farm output in India's trillion-dollar economy, hit the country's southern coast on May 29 this year, three days ahead of schedule.It is expected to enter soybean growing areas of central India this weekend, sources at the weather office said.They said the monsoon's progress over central India was three days behind schedule.The Meteorological Department is expected to release its outlook for the rest of the monsoon season early next week.(Reuters)
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Food inflation went down marginally to 8.96 per cent for the week ended June 4 on the back of cheaper pulses and vegetables.Food inflation, as measured by the Wholesale Price Index (WPI), stood at 9.01 per cent in the previous week, while it was over 21 per cent in the first week of June last year.The latest fall, although very marginal, is likely to be seen as a silver lining by the government, which has been battling the high rate of price rise across all segments for the past few months and also had to contend with low economic growth and factory output numbers in recent months.Headline inflation in the country stood at 9.06 per cent in May.The Reserve Bank has already hiked its key policy rates 10 times since March, 2010, to tame demand and curb inflation.The latest hike of 25 basis points in the short-term lending (repo) and borrowing (reverse repo) rates was announced today.During the week under review, prices of pulses went down by over 10 per cent year-on-year, while vegetables became cheaper by 1.39 per cent.However, prices of other food items continued to move upward.Fruits became almost 30 per cent more expensive, while milk was up 10.59 per cent. Eggs, meat and fish became dearer by 7.31 per cent on an annual basis.The prices of onions went up by 12.17 per cent and potatoes by 1.14 per cent. Cereals were also up by 5.25 per cent.Overall, inflation in primary articles stood at 12.86 per cent during the week under review, up from 11.52 per cent in the previous week. Primary articles have a share of 20 per cent in the overall WPI basket. Meanwhile, inflation in non-food primary articles stood at 20.20 per cent during the week under review, a slight dip from 20.97 per cent in the previous week.Fibres became 53.54 per cent more expensive and minerals were up 25.90 per cent. Fuel and power became dearer by 12.84 per cent and petrol was up 33.23 per cent.Headline inflation has been above the 8 per cent mark since January, 2010.In its annual monetary policy for 2011-12 announced last month, the Reserve Bank had said that inflationary pressure will continue for the next few months on account of high international commodity prices, particularly of crude.It had said that headline inflation would be driven more by commodities like oil in the near future, rather than high food prices, as was the case during most of 2010.The RBI had projected headline inflation to average 9 per cent during the first half of the fiscal, before moderating to around 6 per cent by March, 2012.Food inflation was in double digits for most of last year, before showing signs of moderation since March this year. However, it had again breached the 9 per cent mark during the last week of May after a gap of two months.The government had to deal with a series of bad news during recent weeks on the economic front. While January-March economic growth stood at 7.8 per cent, the lowest in five quarters, industrial output also slowed down to 6.3 per cent in April.(PTI)
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Be prepared to pay more every month on your home, auto and other loans, as the Reserve Bank of India on Thursday, for the 10th time since March, 2010, raised key interest rates by 25 basis points in its effort to control spiralling inflation.The RBI has raised the short-term lending (repo) rate by 25 basis points to 7.50 per cent and the short-term borrowing (reverse repo) rate will move up by a similar margin to 6.5 per cent. It kept other rates and ratios unchanged.The mid-quarterly policy initiatives, the RBI said, are expected to contain inflation, which is currently over 9 per cent, much above the comfort level of the central bank."The RBI has sought to maintain an interest rate environment that moderates inflation and checks inflationary expectations," the Finance Ministry said in a statement, adding that this was on expected lines."We need to have price stability for sustaining growth in the medium term," it added.Bankers said the move would put pressure on interest rates and may make loans costlier subsequently.Consumers To Pay For Rate HikeThe rate hike is expected to be passed on to consumers, said ICICI Bank Managing Director Chanda Kochhar."The RBI steps are on expected lines as inflation still remains stubborn and poses a serious threat to growth," Union Bank of India Chairman M V Nair told PTI here.He also said the bank will pass on the rate increase to customers "as credit growth has so far been robust this quarter". However, he refused to specify how soon the base rate hike would be effected."It (RBI's move) will put pressure on short-term deposit rates and subsequently on the lending rates. But rate hike by banks would not be immediate," Indian Overseas Bank CMD M Narendra told PTI.Echoing a similar view, IndusInd Bank Executive Vice-President Moses Harding said the rate hike will push the shorter end of the rate curve with higher inversion into the longer end.Bank of Baroda Executive Director R K Bakshi, too, said the RBI move was expected, as inflation has become a serious threat to growth.Bakshi also hinted at the possibility of a base rate hike by his bank, saying though no automatic hike will be effected, the bank will act according to the liquidity condition, which he termed as comfortable as of now.According to Punjab & Sind Bank Executive Director P K Anand, there will not be any knee-jerk reaction from the banks, as the rate hike was on expected lines.IDBI Bank Executive Director R K Bansal said the market was expecting the hike and this may not result in banks increasing rates immediately.While announcing the measures, the RBI said that tightening of the monetary policy would impact economic growth, which is already under pressure, in the short term.With the rise in the repo rate, the interest rate for the additional lending facility of the RBI under the marginal standing facility (MSF) has gone up by 25 basis points to 8.5 per cent. This facility was introduced in the annual policy that was unveiled on May 3.Anti-InflationaryThe monetary policy stance, the RBI said, "remains firmly anti-inflationary, recognising that, in the current circumstances, some short-run deceleration in growth may be unavoidable in bringing inflation under control."The economic growth rate in the fourth quarter of the last financial year decelerated to 7.8 per cent from 9.4 per cent in the same period a year ago, raising fears of a slowdown.Also, industrial production during April, 2011, moderated to 6.3 per cent from over 13 per cent in the same month last year.The moderation in growth has not deterred the Reserve Bank into taking a pause on its rate hike strategy, as the "challenge of containing inflation and anchoring inflation expectations persists"."Thus, while the Reserve Bank needs to continue with its anti-inflationary stance, the extent of policy action needs to balance the adverse movement in inflation with recent global developments and their key impact on the domestic growth trajectory," the RBI said.Pointing out that the inflation is at an uncomfortable level, the RBI said the present wholesale price figures "understate the pressure because (domestic) fuel prices have yet to reflect the global crude oil prices."Revised RatesIn the last one-and-a-half months, several banks have revised lending and deposit rates following the annual policy announcement last month. Monetary transmission has been quite strong, with 45 scheduled commercial banks raising their base rates by 25-100 basis points after the May 3 policy.Cumulatively, 47 banks raised their base rates by 150-300 basis points during the July, 2010-May, 2011, period, the RBI said, adding that the higher cost of credit is restraining credit growth. However, it still remains fairly high, suggesting that economic activity is holding course.(PTI)
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It doesn't take much to see that investor confidence in the equity markets has waned somewhat. Just look at traded volumes and the stockmarket indices: better yet, ask your neighbour. What the seventh wave of the BW-JP Morgan Asset Management-Value Notes Investor Confidence Index (ICI) survey shows, however, is that this confidence began declining long before, perhaps as early as at the end of 2010 (the latest wave covers the quarter till March 2011).Overall investor confidence, on a scale of 0 to 200 points (0 is completely negative, 200 reflects full confidence, and 100 is neutral), and as some of the accompanying graphs indicate, fell by 10 per cent in the quarter ended March 2011, compared to December 2010. All three categories — retail investors, corporate investors and financial advisors —that are sampled for the ICI expressed a decline in confidence, albeit to different degrees.Oddly enough, the survey suggests that the decline in confidence is not at the micro-level, or in corporate India's financial performance, but at the macro level; the supreme faith in the India growth story has been dented substantially, and among all economic indicators, inflation has become a serious worry. Most people, one would imagine, do not see stocks and bonds as being the same; inflation can hurt bonds badly because inflation forces interest rate increases, and consequently hurts bond values. Stocks, on the other hand, are driven by earnings expectations, and across a broad swathe of companies, earnings expectations have largely been met.But investors have become savvier; they recognise that rising prices may have inflated revenue numbers. The survey also suggests that investors have also made adjustments to their investment horizons. If the medium term in the past could have been 18 months, it now ranges between three to five years.Future outlook has also been tempered. Most investors believe disposable or discretionary incomes may not grow as much in the next six months; and they don't expect much increase in their investments either. All kinds of investment have been hit: savings and time deposits, insurance, stocks, and even gold. Activity in mutual funds and time deposits has been worse hit.And confidence is not expected to return to previous levels very soon. The policy-making community — led by the Reserve Bank of India — seems to be saying that growth will ‘moderate', but many fear that it could be by more than a little. By how much, perhaps the next wave of the ICI will tell us.Click here to view 'Zeroing In On Money Markets'Click here to view 'Conservative Call'Click here to view 'Future Positive'(This story was published in Businessworld Issue Dated 23-05-2011)
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Falling short of targets set by the Planning Commission is nothing new for the power ministry. The question is of degrees. This year the slippage has been 40.69 per cent — only 12,160 MW of additional capacity was added against a targeted 20,359.5 MW. It, however, is a definite improvement on the past three years' (of the 11th Plan) additions of 9,263 MW, 3,454 MW and 9,585 MW respectively. The ministry is now confident of meeting the revised 11th Plan target of 51,000 MW (down from the earlier 78,000 MW), having added 34,462 MW so far. Click here to view enlarged chart Some documents of the Ministry of Power give an interesting break-up of the slippages among the power companies in various "sectors" — the central PSUs, the state PSUs and the private sector. Predictably, the state PSUs have fared the worst with a slippage of 56.7 per cent. They could only add 2,759 MW capacity, in comparison to targeted 6,368 MW. The private sector, too, does not have a stellar record — it managed to add 5,151 MW against a target of 6,877 MW, a slippage of 25 per cent.Even the existing power capacity is not being utilised optimally. Central power generators Damodar Valley Corporation (1,500 MW) and Nuclear Power Corporation (1,000 MW) showed the maximum slippage. The state power generators fell short by 4,130 MW. The shortfall for -private players was 3,305 MW — JSW and Lanco were highest at 1,275 MW and 1,270 MW, respectively.The reasons for this shortfall, the documents shows, are not all unavoidable. At least 6,638 MW of shortfall was due to factors "within control of the project authorities". Shortage of coal, external environments and poor connectivity to the grid fall in the category of causes "beyond control of project authorities" that account for 2,100 MW.Another interesting data in the ministry documents is the shortfall in the supply of plant equipment. BHEL, the national power equipment supplier, shows a slippage of close to 50 per cent, about three times that of the Chinese companies.All in all, these numbers show a not-so-bright power scenario in the country. Especially given the demand for power is expected to increase to 950,000 MW by 2030.(This story was published in Businessworld Issue Dated 23-05-2011)
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The Left was shown the door in West Bengal; the DMK-Congress combine was defeated by J. Jayalalithaa in Tamil Nadu; the Left-led LDF had a narrow miss in Kerala; the Congress won a third-term in Assam, but failed to retain Puducherry.Of the five states that went to polls, the outcome in West Bengal and Tamil Nadu would impact national politics the most since it involves Congress' key coalition partners, Trinamul Congress and the DMK. The victory of Mamata Banerjee in West Bengal will see a more assertive Trinamul, while the rout in Tamil Nadu will make the DMK a meek partner at the Centre.Curtains on 34 years of Left rule in West Bengal and the rise of Banerjee would engage observers of politics and business with equal excitement. The Left parties were widely considered a roadblock to modernisation. Its defeat is sure to give some relief to policy makers.The defeat of the Left, however, does not mean the end of its brand of politics in West Bengal. Banerjee is known to be more Left than the Left — she rode the wave of protests against land acquisition in Nandigram for a proposed chemical hub and Tata's Nano factory in Singur to gain politcal mileage.Banerjee's influence will not be limited to West Bengal. Her party is the second largest in the UPA. Her veto continues to hold the passage of an amended land acquisition bill. The presence of Ficci secretary-general Amit Mitra in Banerjee's rainbow coalition, however, could be the silver lining for policy makers. Mitra is tipped to become West Bengal's finance minister and could also advise Banerjee on economic issues. Further, Banerjee herself has been assuring that she is not against industry. "Bengal will show the way," Banerjee declared after the victory and promised industrialisation as well as protection of farmers' rights. It appears to be a difficult proposition.Signals from Tamil Nadu, Kerala and most importantly a by-election in Andhra Pradesh do not bode well for the Congress. The rout of the DMK-Congress alliance and the Congress barely crossing the halfway mark in Kerala show that the issue of corruption swayed voters.Polls in Tamil Nadu were fought in the backdrop of the 2G spectrum scam and it had formed Jayalalithaa-led AIADMK's main poll plank. Similarly in Kerala, LDF leader V.S. Achuthanandan had turned the corruption tide against the Congress-led UDF leaders. With a host of scandals rocking the UPA government, the Congress faces the danger of the disaffection spreading across the country. Another setback for the UPA came from the Kadappa by-election in Andhra Pradesh where Jagan Mohan Reddy won by a record margin. His rise could topple the Congress government in the state.Assam was the only solace for Congress, where it returned to power for a third term with a decisive victory. The northeastern state, however, is not expected to bring much relief to the Manmohan Singh government. Assam may have been more a case of lack of a cohesive local opposition to the Congress than anything else.The real challenge for the Congress will come in Uttar Pradesh, which goes to the polls next year. And what the UPA does in the meantime to rid itself of the many stains of corruption will come to bear upon that verdict.The author is special correspondent, The Telegraph(This story was published in Businessworld Issue Dated 23-05-2011)
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UK-based oil explorer Cairn Energy, battling challenges to two major projects in Greenland and India, announced its chief executive would step up into the chairman role amid a sweeping board shake-up.The company said on Thursday that Bill Gammell, who founded the company, would move into the chairman role, leaving the CEO post to be filled by Simon Thomson, the current legal and commercial director.Corporate governance code frowns upon the practice of chief executives stepping into chairman jobs, which can make it hard for new CEOs to challenge their predecessors' decisions.Cairn said it had consulted major shareholders and said they were comfortable with the decision.Cairn is currently battling to complete two major undertakings. Its exploration plan in Greenland, aimed at opening up a new oil province with potentially billions of barrels, has been interrupted repeatedly by environmental campaigners.In addition Cairn's planned sale of most of its stake in its Indian subsidiary, Cairn India, to Vedanta Resources <VED> has also been delayed due to challenges from the government, which wants to extract higher taxes in return for approving the sale.A spokesman said Gammell had been mulling an end to his long tenure for some time and that the move was unrelated to any other issues.Cairn's shares were down 1.4 percent by 0800 GMT, underperforming against a 0.6 percent slide in the STOXX Europe 600 Oil and Gas index.Some investors had expected that Gammell would be succeeded by Mike Watts, Cairn's exploration director, who will retain his position.Malcolm Thoms, 55, chief operating officer, and Philip Tracy, 61 group engineering and operations director, will stand down from the board, as will outgoing chairman Norman Murray.Finance director Jann Brown will become managing director.Gammell, a childhood friend of former U.S. President George W. Bush who also went to school with former British Prime Minister, Tony Blair, built the multi-billion dollar exploration business from scratch.A former rugby international player for Scotland, he has become one of the most respected figures in the British oil industry.(Reuters)
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The rich-world's economic prospects have darkened slightly, a Reuters poll of economists showed, with new signs of a slowdown in the United States compounding fears about the poor fiscal health of Western economies.Since last month's regular survey of around 250 analysts in May, recent events have only underlined the increasingly disjointed nature of the global economic recovery.While China and India took new steps to calm fervent and inflationary economic expansions, Western powers have been preoccupied with attempts to defuse fiscal time-bombs in Greece and possibly the United States against a backdrop of tepid growth.Economists in Wednesday's poll took an axe to the outlook for US economic growth following a raft of dire jobs and industrial data this month, while keeping their long-held view for weak euro zone and UK growth until the end of next year.Only the Japan saw an upgraded outlook in the latest poll thanks to reconstruction efforts that have gained pace since the March 11 earthquake and tsunami."Two key downside risks have increased over the past few months -- the risk of a disruptive default in Greece and of a significant slowdown in the US," said Kurt Karl, chief US economist at Swiss Re in New York, in a research note.He expressed hope the US slowdown may be nearing an end, since oil prices are no longer rising and the supply bottlenecks caused by the Japanese disasters should be resolved later in the year.Still, financial markets have already reacted to the slowdown taking place. World stock indexes have shed much of the gains made since the start of the year, while US Treasury bond yields have fallen.The consensus forecast for US second-quarter gross domestic product was slashed to an annualised 2.5 per cent from 3.3 percent in last month's poll, following a weak 1.8 per cent rate of growth recorded in the first quarter.Such a rate of expansion would still place the US top among its euro zone, UK and Japanese peers, but well behind major emerging market powers that themselves are showing signs of slowing growth.India and China saw accelerating inflation in May, according to data on Tuesday, prompting the Beijing to lift bank reserve requirements and putting pressure on India to hike interest rates further.Rates of growth and inflation have been far greater in these developing powers, but the dilemma of keeping inflation in check without sacrificing growth has preoccupied policymakers everywhere.The latest batch of Reuters surveys showed inflation pressures are still on the rise in the West too -- with CPI forecasts in the U.S. and especially Britain being bumped up.Indeed, over the course of this year, inflation estimates in the U.S., UK and euro zone for Q2, Q3 and Q4 2011 have doubled -- and in some cases more than doubled -- owing to the surge in crude and commodity prices.Perhaps reflecting expectations for higher inflation in the U.S., the poll showed only a median 15 percent chance the Federal Reserve will embark of a third round of money supply-boosting quantitative easing.Rate ExpectationsUnlike in major emerging powers, which have managed a sustained and forthright policy of tightening interest rates to counter high inflation, Western central banks have shown no such coordination.A Reuters poll on Wednesday showed the People's Bank of China will yet take more measures to curb price pressures, currently at three-year highs.In the West, only the European Central Bank has so far acted against above target inflation among the four biggest central banks -- also including the Fed, Bank of England and Bank of Japan -- after raising interest rates from a record low 1.0 percent in April.But pressure is mounting on the Fed and BoE to follow suit."A significant pick-up in inflation, with sluggish growth, will leave Fed policy in a bind," said Stephen Lewis, economist at Monument Securities in London."By Q2 2012, the Fed's credibility is likely to be under so much strain that it will start the process of normalising interest rates."Indeed, a survey published earlier this month suggested high inflation has already dealt a heavy blow to the BoE's credibility since the start of the year. Inflation there hit 4.5 percent in May, far beyond the BoE's 2 percent target.UK economic growth, in common with the neighbouring euro zone, will struggle to exceed 0.5 percent in any quarter from now until the end of next year.While France and Germany have led the recovery among the euro area's 17 nations, debt-laden strugglers like Greece, Spain and Portugal have dragged badly on growth.Even so, the bloc looks like it will avoid a direct hit from the festering sovereign debt crisis that has enveloped Greece.Even before the March 11 earthquake and tsunami off Japan's east coast, the world's third largest economy was struggling to generate meaningful growth. But economists upgraded the outlook for Japan's recovery for the third successive month."The recovery will gather pace in July-September and the economy is expected to achieve a V-shaped recovery," said Shinichiro Kobayashi, a senior economist at Mitsubishi UFJ Research and Consulting.While poll respondents expect the Japanese economy to contract 0.7 percent in the second quarter, they see it rebounding 1.0 per cent in the third.(Reuters)
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As a monster roller-coaster ride, the commodities market is hard to beat. Three events in the past 10 days triggered a sell-off in global commodities markets and put them in a tailspin unlike any that we have seen before. Commodity prices fell between 2 and 17 per cent across categories (see ‘All Fall Down').First, QE2 — the second round of quantitative easing by the US Federal Reserve — comes to an end in June; second, the Chicago Mercantile Exchange and the New York Mercantile Exchange increased traders' margins to curb "excessive speculation: silver prices dropped 30 per cent, oil prices also declined relatively rapidly; basic metals and agricultural products — cotton and coffee among them — followed suit. Market reports suggest that investing legend George Soros, billionaire hedge fund manager John Burbank and JP Morgan offloaded positions in precious metals, particularly silver, where the costs of trading went up by 84 per cent (in margins). Oil prices fell after the US Department of Energy released data on its strategic petroleum reserve and inventories that were much higher than expected (up by 3.8 million barrels to 370.3 million barrels, as on 6 May)."Things that rise quickly without sound fundamentals also come down too fast and that's the reason why commodity prices plunged, especially silver," says Naveen Mathur, associate director, commodities and currencies, at Angel Broking, a Mumbai-based securities firm. "It triggered margin calls and stop-losses that intensified the fall."Does this mean that Indian manufacturers can look forward to lower input costs? Not exactly. While price of copper, lead, zinc and natural gas for the year are down by 8 per cent, 9 per cent, 11 per cent and 4 per cent, respectively, prices of iron ore, aluminium and crude oil for the year are still trading higher by 2 per cent, 2 per cent and 13 per cent, respectively. Prices of coffee (22 per cent), corn (10.5 per cent) and cotton (5 per cent) are still up.A further correction is not considered very likely, at least in the immediate future. "Prices will remain range bound, with downward bias," says Vivek Gupta, managing director, GEPL Capital, a financial services firm. Governments across the region are trying to control high inflation; holding inventory could become expensive and players may offload positions, softening commodity prices, he adds.For Indian consumers, the biggest concern will be the impact of oil prices. They may have fallen, but not enough, and definitely not as low as the average for the Indian crude basket of roughly $85 for 2010-11. With Brent crude at about $115 a barrel, likely to stay that high, government finances will feel the strain.This much seems very likely: the government will have to raise the administered prices of diesel and liquefied natural gas, despite the potential hardship for the public at large, and the impact on consumption demand. The Reserve Bank of India had hinted as much in its annual monetary policy on 3 May this year.Despite actions by central banks around the world, global liquidity — and thus speculative commodity investment — will continue its run for a while longer. The commodity price cycle may correct, but slowly. So don't hold your breath waiting for a big fall.(This story was published in Businessworld Issue Dated 23-05-2011)
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India is on track to produce 700 megawatts of solar power at a cost of $2.2 billion by December, ahead of an initial target for an ambitious plan that seeks to boost green power generation from near zero to 20 gigawatts (GW) by 2022.Under India's Solar Mission, investors bid to build solar power plants and the winning bids are determined by the electricity tariff that they accept as viable. Such has been the interest that the government has been flooded with investment pledges for the first batch of projects rolling out in December.India's 20 GW solar plan is likely to attract overall investment of about $70 billion, the government has estimates. Issued in 2009, the plan envisages India producing 1,300 megawatts (MW) by 2013, another up to 10 GW by 2017 and the rest by 2022."The entire solar industry is no longer worried about the upheavals that are taking place in the European markets because they find a very new and very promising market is developing in India," said Debashish Majumdar, chairman and managing director of Indian Renewable Energy Development Agency.IREDA, a state-run agency, is the leader in the country's solar energy financing."So far, every year the general mood was that nobody knew what would happen to the German policy or what would happen to Spanish policy," said Majumdar, who attended a global summit on clean technologies in Munich last week.Germany, the world's top solar power producer with about 17 GW installed by end-2010, is considering cutting incentives for photovoltaic energy by an additional six percentage points in another step on March 1, 2012.Germany, Spain, Italy, Japan and the United States are the leading producers of solar power in the world.While India's solar sector remains a risky venture because of a shortage of data and trained manpower, such deficiencies also open up a huge market for expertise and technology such as Colorado-based Juwi Solar, Schneider, Schott Solar."The (Solar Mission's) second phase would create a very large market for service providers, especially EPC contractors and people who can analyse data to ascertain how much resources like sunlight are available and how much (solar energy) is going to be produced," Majumdar said."These agencies would get lots of business," he told the Reuters Global Energy and Climate Summit in New Delhi, adding it was still not possible to determine the size of such a market.EPC contractors handle the engineering, procurement and construction of solar power plants.Sunshine PoliciesIf everything goes to plan, and the rollout of the first projects in December should be an indicator, solar would contribute the equivalent to one-eighth of India's current installed power base by 2022.This will help the world's number three carbon polluter to limit its reliance on coal and ease a power deficit that has crimped the world's second-fastest growing major economy.The Solar Mission has certain local content mandates, in other words some imports of equipment and technology will be allowed until 2013 after which capacity has to be built locally.The special incentive package offers a capital subsidy up to 25 percent on investments for setting up solar cell manufacturing plants. A plant has to be worth at least $225 million to qualify.With about 250-300 clear sunny days a year, India's solar power reception is about 5,000 trillion kilowatt-hours per year, meaning just 1 percent of India's land area can meet the country's entire electricity requirements till 2030.Coal, available in abundance in India, provides power at about 2 rupees (4 cents) a unit, compared to a kilowatt hour of solar power at 11 to 12 rupees.The renewables sector comprises 6 percent of India's total power mix.Consulting firm KPMG said last month aggressive policy implementation could see solar power prices decline at a rate of 5-7 percent annually over the next decade, ensuring "grid parity", or the point when solar power costs the same as conventional power, as early as 2017/18.(Reuters)
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