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Pawar: India heading for bumper food grain production
New Delhi: Agriculture Minister Sharad Pawar has said that the country was heading for a record food grain production this year despite initial hiccups due to delayed rains.

"Even though monsoon arrived late, we have reviewed the sowing situation and are confident that this year would be one of the best years for agriculture production," Pawar told reporters here.

Till the end of last month, there were some worry due to late arrival of monsoon, but the July showers have revived the expectation of a high food grain output for this year, he said.
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ICRIER: Allow 49 per cent FDI in retail sector
New Delhi: The Indian Council for Research on International Economic Relations (ICRIER) has advocated allowing FDI of up to 49 per cent in retail sector backed with reforms like repeal of Essential Commodities Act even as Left parties continue to oppose any opening up of the sector to foreign investment.

According to Arpita Mukherjee, senior fellow of ICRIER, ''In the initial stage FDI up to 49 per cent should be allowed which can be raised to 100 per cent in three-five years depending on the growth of sector. FDI cap below 49 per cent would not bring in desired foreign investment.''

Pointing out that the retail sector, which contributed 10 per cent of country's GDP, was highly fragmented, ICRIER's study suggested a 3-5 year time frame for complete opening to give domestic retailers enough time to adjust to changes along with reforms like repeal of Essential Commodities Act and doing away with MRP-based pricing.

However, the study felt there could be some job displacement due to reduction in number of intermediaries and middlemen, which would be compensated by creation of new jobs in allied sectors. It pointed out that organised retailing created more employment for educated youth and some loss of employment for uneducated people and suggested that government should create alternative job opportunities.

''Employment programmes should focus on creation of quality jobs,'' the study said highlighting that often people opted for unorganised retailing not out of choice but due to lack of alternative employment opportunities. The study pointed that since foreign retailers are allowed to enter the market through other routes and argued that the existing ban on FDI has not acted as an entry restriction.
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FICCI urges cautious approach on FTAs
Bangalore: FICCI has urged the Centre to exercise great caution while entering into preferential or free trade agreements.

The rules on the origin of goods should be studied carefully and followed strictly with any preferential partner; otherwise it would lead to a flood of re-exported goods from a non-manufacturing country, FICCI officials addressing a press conference stated here.

With India, as South Asia's prime mover, currently negotiating a dozen regional, free or preferential trade arrangements, the origin of goods would be of key concern, as these imports would have a direct impact on the domestic industry.

FICCI also proposed to draw up an India strategy paper on FTAs.

It would also strongly push for such pacts with developed countries such as Japan and the US on services as these would have beneficial technological spin-offs.

Referring to last month's landmark pact with Singapore - the Comprehensive Economic Cooperation Agreement or CECA - and the preferential trade agreement with Sri Lanka, they said these had pitfalls. While Singapore is the transit country for 45 per cent of goods, under CECA, India could end up with a flood of Chinese goods at nil duty if it did not watch out.

Likewise, Sri Lanka, which does not produce copper, would be exporting the commodity to India at zero duty. Import of pepper and vanaspati was also an issue. Likewise, there was a "perverse and inverted duty structure" with Thailand as in the case of glass for TV picture tubes, which threatened domestic manufacturers.

However, there was no denying the benefits and increased market reaches of FTAs with the right partners, as the study showed. South Asian SAFTA opened up a combined market of $750 billion; the Bangkok agreement creates a market of 2.5 billion people, while the FTA with Asean would potentially increase goods trade turnover to $30 billion by 2007.
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