Monday, October 24, 2016

The worst period for the fish sector is over, says A. Jayathilak

India will become a marine sector hotspot: MPEDA
India's marine product exports have been a bright spot in the otherwise gloomy merchandise export growth scenario of the country. After managing to recover from last year's blip, marine exports is all set to achieve the $5.6 billion revenue mark, closest to its record high, this year. A. Jayathilak,Chairman of Marine Products Export Development Authority (MPEDA), the Commerce Ministry arm responsible for the promotion of quality marine product exports, talks about the increasing global demand for shrimp, and India's preparedness to harvest this single most important growth driver for marine exports. Excerpts:
Marine product exports dipped 10 per cent last year. How do you see the market growth now?

Even though we had a 10 per cent dip last year, in the first eight months or so, we have recovered that completely. We are going at 10 per cent growth rate for the last six months. I think the worst of recession is over. As far as the fish sector is concerned, the worst period is over. If you look at the rate of export growth, we are confident of touching $ 5.6 billion this year. We have set a $ 10 billion target for 2020.

If you look at our marine exports basket, it is heavily skewed in favour of shrimp. Here again, there is a very sharp focus on one particular species. Is this way of export promotion sustainable?
Ideally, we shouldn't be putting all our eggs in one basket. This is happening because of the huge international demand for pacific white shrimp. It goes by market dynamics. We don't expect the demand to come down overnight because it has already captured the world market. But, yes, we need to diversify.
Why is white shrimp farming so attractive?
One visit to any farm in Andhra Pradesh will tell you why it is so attractive. The payback period for white shrimp farming is the smallest for any crop. It is less than two years. The cost of aquaculture per hectre is Rs 12 lakh. In the first year itself you can take one crop; you will get a net profit of Rs 6 lakh. In the second year, you get a net profit of Rs 12 lakh. If you invest 12 lakh rupees, you get 18 lakh in two years, and you would have recovered your entire investment. Everything else is a bonus after that. That is why anybody who comes to coastal Andhra Pradesh, and sees the economics of this, finds it attractive.

Food exports to USA - a key market for India - are increasingly coming under regulatory scrutiny. How can the aquaculture industry be equipped to face the US Food and Drug Administration's (FDA) challenge?
The quality standards are becoming more and more stringent not only with USFDA, but with other regulators, too. The standards, and the periodic modifications, have to be communicated to and understood by the entire supply chain. In all our extension activities, this information is communicated, so that they adhere to all the procedures that are now mandated internationally. We take inputs from them (USFDA), though there is no direct role for the regulatory agency. The other way to ensure best practices is to let the exporter know who actually produced the lot he exports. When you merely aggregate and sell in containers, you will not know which lot came from where. We are setting in place a traceability system. It will take some time. But with bar coding, you will be able to trace the shrimp to the pond.
Each year, new areas are getting added. Every region has its own problems…
The great demand for shrimp itself will ensure that the industry takes care of this problem. They are aware that they will either get the best return, or get zero return - if the lot is contaminated, it is not exported at all.
The minister had announced plans for turning MPEDA into a federation of state-level bodies. You already have 14 regional offices which are trying to assist state-level exporters. How relevant, hence, is this new attempt?
This is similar to what we have already introduced in the spices sector (Jayathilak was earlier chairman of the Spices Board). As regulatory and marketing agencies, Spices Board and MPEDA cannot get into cultivation or production. Both are clearly areas that come under the domain of respective state governments. However, farmers approach us (MPEDA, Spices Board) for problems related to land or cultivation. Since our mandate is limited, we cannot intervene. The new state-level agencies will fill that gap. These agencies will function as a good coordinating mechanism between the production aspect of the supply chain and the export linkages. A very good, established exporter, one who has already developed his contacts with the state government and MPEDA, may not need this. But institutional mechanism will help every farmer and every exporter, as you will have a single window system to address all the issues. These agencies will be headed by the Chief Secretary, so there will be total involvement of the state government in addressing all the production related issues. It will be addressed by all the regional offices of MPEDA, which will take care of quality control and export promotion. That is the value addition.
Q. Is your $10 billion target completely dependent on pacific white shrimps?  
We want to promote the black tiger shrimp, the original Indian shrimp variety, too. Suddenly there is this craze for pacific white shrimps, and we have forgotten our family heirloom, so to speak. Black tiger shrimp has a distinctive taste. There is a latent demand for black tiger, which is not tapped. It is a niche market. Even now there are enquiries, but we are not able to meet them. We will actually get a higher price for black tiger, since when supply is low, unit value realisation will be higher. Once our nucleus breeding centre in Andaman is ready, the production of black tiger will also go up. That is how we will approach the $10 billion target.
Q. What is the most critical issue before you at the moment?In case of pacific white shrimps, the critical issue is the supply of raw material. Right now, we are dependent on seedlings from the US. In the two to three years, we should be totally self-sufficient in providing seedlings. That is the plan.

Power Sector Debt Worth Rs 1.34 Trillion At High Risk: Crisil

Power India Sector

The credit growth to the sector will moderate to 5 per cent over the next three years as compared to an average of 18 per cent witnessed in the last five years, Crisil senior director Sudip Sural says

Nearly Rs 1.34 lakh crore worth of debt on operational and under-construction power projects is at risk, says ratings agency Crisil.

As per Crisil estimates, around 17,000 MW of operational power projects with a debt of Rs 70,000 crore and additional 24,000 MW under-construction projects with a debt exposure of around Rs 64,000 crore are at high risk.

"These operational projects are those, which are facing the consequences of aggressive bidding for coal supplies or facing huge cost overruns, and those with gas-supply issues," Crisil Senior Director Sudip Sural said.

He said over the period, the credit growth to the sector will moderate to 5 per cent over the next three years as compared to an average of 18 per cent witnessed in the last five years.

"This is primarily because the discoms debt which has been the key components of this exposure, is going to go out of the banking system over a period of time and move to the fold of the state government because of the UDAY scheme," Sural said.

Also, fresh investments in the thermal generation sector will remain muted, while on the other hand the capacity addition in the renewable space will give some fillip to the credit growth, he said.

As far as delinquencies are concerned, Crisil noted, that while the gross NPAs in the sector have increased from 1.3 per cent to 4.4 per cent in financial year 2015-16, the stressed assets as measured by gross NPAs and restructured standard assets continue to remain steady at 14 per cent.

"They have not seen an increase primarily on account of the movement of Rs 75,000 crore out of this category on the account of UDAY scheme. So, essentially on the restructured assets quantum have come down," Sural said.

"But even with the reduction it continued to be at elevated level in the sector," he added.

Crisil further observed that in the discoms space banking sector debt is expected to come down significantly over the next 3 years with UDAY scheme making increasing impact.

"What we will see is that state governments will take over the principal financiers to discom. As per our estimates as of March 2019, of the roughly Rs 4.6 lakh crore exposure to discoms Rs 3.4 lakh crore would be coming in from state governments," he noted.


Wednesday, April 6, 2016

Panama Papers: Indians on the list

Panama Papers: Indians on the list

Actors, politicians, businessmen, an ex-cricketer—here's a look at Indians whose names have featured in the Panama Papers so far.

Saturday, February 27, 2016

Impact of the Union Budget on the Indian Stock Market

Impact of the Union Budget on the Indian Stock Market
Budget day has been seen as one the The most important trading days in the history of the stock markets.Budget day trading is a Speculator’s delight. Huge swings can be seen in stocks based on how the market perceives what the finance minister just spoke. The reactions are instantaneous when one perceives the huge benefit for the huge disadvantage that comes up due to the addition or removal of some duty.
Union Budget is just 2 days away. Maximum Range on Budget day is 346 so big volatile move on cards, so trade cautiously.

Sunday, February 14, 2016

Bull Markets vs. Bear Markets :Some Facts

Bull Markets vs. Bear Markets :Some Facts
Bull Markets: Fear of missing out.
Bear Markets: Fear of being in.
Bull Markets: Everything I buy is going up — I’m a genius.
Bear Markets: Everything I buy is going down — I’m an idiot.
Bull Markets: See, fundamentals always win out.
Bear Markets: See, technicals and sentiment rule the markets.
Bull Markets: I knew I should have had more of my portfolio in stocks.
Bear Markets: I knew I should have had more of my portfolio in bonds.
Bull Markets: That guy’s been calling for a crash for years — he’s an idiot.
Bear Markets: That guy just called the crash — he’s a genius.
Bull Markets: I want to be a long-term buy and hold investor.
Bear Markets: I want to be a short-term trader.
Bull Markets: I’m glad I was buying during the last market crash.
Bear Markets: Never try to catch a falling knife.
Bull Markets: I’ll sit tight when the market falls.
Bear Markets: Dear Lord, get me out of stocks NOW!
Bull Markets: Time to buy stocks?
Bear Markets: Time to sell stocks?
Bull Markets: Warren Buffett is washed up.
Bear Markets: Wait, Buffett is buying here?
Bull Markets: Buy & hold works.
Bear Markets: Buy & hold is dead.
Bull Markets: I’ll be greedy when other are fearful.
Bear Markets: I lied — I’m fearful when other are fearful.
Bull Markets: Buy the dip.
Bear Markets: Sell the rip.
Bull Markets: Why didn’t I invest earlier in my life?
Bear Markets: I’ll never invest again.
Bull Markets: Why would I want to diversify?
Bear Markets: Why was I so concentrated?
Bull Markets: I’m just waiting for a healthy correction to put more money to work.
Bear Markets: This market action is not healthy at all.
Bull Markets: Don’t worry, we’ll outperform during the next downturn.
Bear Markets: Don’t worry, we’ll outperform when the market turns around.
Bull Markets: It feels like markets will never fall again.
Bear Markets: It feels like markets will never rise again.