India approved changes to a century-old land law and set up a panel to speed up infrastructure projects as Prime Minister Manmohan Singh extends a policy overhaul to revive economic growth.Amendments to the colonial-era Land Acquisition Act may help the government curb often violent protests that have stalled projects for industry and highways. The cabinet committee also allowed the establishment of an infrastructure panel and a 30 percent reduction in the sale of airwaves.Enlarge image
Manmohan Singh, India's prime minister. Photographer: Pankaj Nangia/BloombergEnlarge image
The prime minister is seeking $1 trillion in investments for highways, ports and power plants from 2012 to 2017 to spur development. Photographer: Namas Bhojani/BloombergThe approvals add momentum to Singh’s policy agenda by addressing transportation and energy bottlenecks that have handicapped growth in Asia’s third-largest economy. The prime minister has already won support to open the economy to overseas retailers, the biggest embrace of foreign investment in a decade, as he bids to repair the government’s reform credentials before national elections in 2014.“The key here is that the government clearly wants to keep up the reform momentum,” said Robert Prior-Wandesforde, an economist in Singapore at Credit Suisse Group AG, who has covered the Indian economy for almost seven years. “It wants to signal to the Reserve Bank of India, as well, that it’s committed to a series of economic reforms of the sort that the RBI would appreciate.”The economy expanded 5.3 percent in the three months ended Sept. 30 from a year earlier, slowing to match a three-year low. Central bank Governor Duvvuri Subbarao, in the last policy meeting in October, resisted calls from Finance Minister Palaniappan Chidambaram for lower interest rates to spur growth.Stalled Investments
Singh will head a new panel aimed at speeding up approvals of infrastructure projects. The prime minister is seeking $1 trillion in investments for highways, ports and power plants from 2012 to 2017 to spur development.After at least two years of debate, the cabinet yesterday agreed to make it mandatory for companies buying land to win the approval of 80 percent of landholders. For public-private partnership projects, 70 percent of the landowners need to give consent, according to Parliamentary Affairs Minister Kamal Nath.Abuse of the 1894 law that allowed the state to seize land at cheap rates if it believes there’s a larger public benefit, such as the creation of jobs, has led to clashes between farmers and provincial administrations, and fueled Maoist rebellions in some mineral-rich states, including Chhattisgarh and Odisha. Among investments postponed is a $12 billion project first proposed by South Korean steelmaker Posco (005490) in 2005.The law will be applied retrospectively in certain cases and also seeks to boost the money paid to farmers. Rahul Gandhi, who will lead the Congress party’s election campaign ahead of parliamentary polls in 2014, has championed the land law changes.Most Pessimistic
http://www.bloomberg.com/news/2012-12-14/india-steps-up-policy-overhaul-with-land-law-approval-economy.htmlJapan Tankan Business Confidence Falls to Near 3-Year Low
By Andy Sharp - Dec 13, 2012 9:29 PM ETBig Japanese manufacturers are the most pessimistic in almost three years after a diplomatic dispute with China and Europe’s austerity measures dragged exports to a fifth monthly decline in October.The quarterly Tankan index for large manufacturers fell to minus 12 in December from minus 3 in September, the Bank of Japan (8301) said in Tokyo today, a fifth straight negative reading and the lowest since March 2010. The median estimate of 25 economists surveyed by Bloomberg News was for minus 10. A negative figure means pessimists outnumber optimists.Enlarge image
Japan’s gross domestic product shrank an annualized 3.5 percent in the three months through September after a 0.1 percent decline in the previous quarter. Photographer: Haruyoshi Yamaguchi/BloombergEnlarge image
Toyota’s sales in China fell 22 percent from a year earlier in November, after a 44 percent drop in October and a 49 percent decline in September. Photographer: Nelson Ching/BloombergThe slide in sentiment gives the central bank an extra reason to ease policy on Dec. 20 after the Federal Reserve moved this week. JPMorgan Chase & Co. sees a 10-trillion yen ($120 billion) expansion of an asset-purchase program and the pressure for further loosening is likely to mount if opposition leader Shinzo Abe’s party wins an election in two days’ time.“The focus is on whether the economy will show any improvement after the election,” said Hideo Kumano, chief economist at Daiichi Life Research Institute who correctly predicted today’s reading. “Given that exporters’ confidence has weakened so much, calls for a cheaper yen will mount.”At the next BOJ policy meeting, officials will also consider an extension of currency-swap arrangements involving the Fed, European Central Bank, and the central banks of Canada,England and Switzerland, the Japanese central bank said last night.
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