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Today's Hot Stories - April 13, 2010

10 Headlines for Today

(1) India to get access to Purulia arms drop mastermind
(2) Couple found dead in Haryana, honour killing suspected
(3) Pat-down checks mandatory for all West-bound flyers
(4) Delhi whiz Ajay Banga becomes MasterCard CEO
(5) US revival to give a boost to Indian IT companies
(6) Vedanta's plan mired in charges of ecological sins
(7) IPL Kochi franchisee spat sets up Modi-Tharoor clash
(8) Rohit, Harmeet keep Deccan in semifinal hunt
(9) Bondarenko advances at Family Circle event
(10) Traumatized Poland identifies its dead

5 Stories for Today

(1) US, India military brass discuss China's rising power
(2) All eyes on Manmohan, Gilani handshake
(3) Air Asia to add six more India-Malaysia flights
(4) Infosys Q4 profit at Rs. 1,617 crore
(5) Industry posts 15.1% growth in February

(1) US, India military brass discuss China's rising power

Wary as they both are of China’s long-term intentions, India and US came together on Monday to discuss Beijing’s galloping modernisation of its 2.25-million strong armed forces and its strategic moves in the Asia-Pacific region.

The ‘Red Dragon’, with its spreading wings, was a prominent presence in the room during the talks visiting US chief of naval operations chief Admiral Gary Roughead held with the top Indian military brass, including Navy chief Admiral Nirmal Verma and Army chief General V K Singh, on Monday.

Both sides, among other things, shared their assessments of China’s transborder military capabilities and its increasing presence in the Indian Ocean Region (IOR). China, of course, has also forged extensive maritime links with IOR countries like Myanmar, Bangladesh, Sri Lanka, Maldives, Seychelles, Mauritius and Madagascar. China’s ambitious aircraft carrier building programme was of particular interest since this is one arena in which it actually lags behind even India.

At present, while China may have as many as 62 submarines, with 10 of them being nuclear-powered and three armed with long-range ballistic missiles, and 75 major warships, it does not have an aircraft carrier.

(2) All eyes on Manmohan, Gilani handshake

Among all possible gestural permutations when 47 world leaders gather together in one room, the meeting of hands which everyone seemed to be waiting for was between Prime Minister Manmohan Singh and his Pakistani counterpart, Yusuf Raza Gilani.

The two prime ministers met at the Walter E. Washington convention centre in downtown Washington, venue of the Nuclear Security Summit which got underway Monday evening with a reception hosted by President Barack Obama.

Prime Minister Gilani strode up to Dr. Singh and the two men greeted each other warmly.

This was Dr. Singh and Mr. Gilani's first encounter since their July 2009 interaction on the sidelines of the Nonaligned Summit at Sharm el-Shaikh in Egypt.

Foreign Secretary Nirupama Rao ruled out the possibility of Prime Minister Singh meeting formally with Mr. Gilani in Washington. But Indian officials say the two leaders are likely to meet each other in Thimphu later this month during the SAARC summit and have a more substantial interaction than today's handshake, warm and effusive though it appears to have been.

(3) Air Asia to add six more India-Malaysia flights

Low-cost carrier Air Asia is planning to add another six flights to India this year from Malaysia to cater to growing traffic.

Flights from Penang to Kolkata would start from April 28, Kuala Lumpur to Mumbai May 6, followed by Kuala Lumpur—Chennai, Kuala Lumpur—New Delhi, Kuala Lumpur—Bangalore, Kuala Lumpur—Hyderabad. “Air Asia is planning Kolkata—Bangkok direct flight, may be in the middle of next year. Probably it will be a daily flight,” Tony Fernandes, group CEO, said.

“We will go everywhere in India in due course. In China, we go everywhere,” he said.

The airline already connects four destinations — Tiruchirapalli, Trivandrum, Kolkata and Kochi — to Kuala Lumpur. Recalling how he bought debt—ridden Air Asia with three other people for only a token 26 cents in December 2001, Mr. Fernandes said: “We only had two aircraft when we started. Eight years later, now we carry 27 million people and have 92 aircrafts.”

The company has bought another 120 aircraft, which are to be delivered within 2015, he confirmed.

Asked about his plans of connecting any other destination in India with Malaysia soon, he said: “Probably Amritsar will be our next destination. I have promised the Sikhs in Southeast Asia.”

An accountant by training, the 45—year old Fernandes was in music business for 14 years before he planned to buy Air Asia. Saying India with a billion plus population is like a continent, he added: “Focus on lowering the cost is very important to stimulate the new market. The type of fares we have created, people have never thought of flying in such fares. Secondly, sustainability is very important. The third aspect is we created new markets like Thiruvananthapuram.”

He said: “We give people more choice. One who does not want to eat or one who does not want to have a privileged seat will pay less. On the other hand, one who is carrying 15 (pieces of) luggage, for which the plane weighs more and burns more fuel, needs to pay more.”

Air Asia charges for privileged seats. From July the airline company is planning to introduce through check—in for connecting flights, which will be charged.

“We have started a new joint venture airline with VietJet Air recently,” he said. VietJet Air chief operating officer Nguyen Duc Tam and Tony Fernandes signed the agreement in Hanoi. AirAsia had earlier acquired a 30 percent equity stake in VietJet Air.

He ruled out any plans to invest in any Indian airline company. “India does not allow such investments. An individual can buy but not a company.”

Consolidated turnover last fiscal (January—December 2009) was RM 7 billion and the company made RM 600 million profit. He, however, declined to forecast any growth figure for the company this year saying it was constrained by the stock exchange from divulging any figure.

(4) Infosys Q4 profit at Rs. 1,617 crore

IT major Infosys Technologies on Tuesday reported a marginal rise of 0.25 per cent in consolidated net profit at Rs. 1,617 crore for the fourth quarter ended March 31, 2010.

The company had a net profit of Rs. 1,613 crore in the March quarter of the previous fiscal (2008—09), Infosys said in a filing to the Bombay Stock Exchange.

Income from software services, products and business process management rose to Rs. 5,944 crore for the fourth quarter from Rs. 5635 crore in the year—ago period.

The company’s cash and cash equivalents stood at USD 3.5 billion at the end of March 31, 2010.,

“We maintained our margins in one of the toughest years for the industry. The currency volatility continues to be a concern for the industry. We have an active hedging programme to minimise its impact on our margins,” Infosys CFO V. Balakrishnan said.

For the year ended March 31, the IT bellwether posted a consolidated net profit of Rs. 6,266 crore, up 4.64 per cent over the year—ago period.

The board has declared a final dividend of Rs. 15 per share for the fiscal on every share of Rs. 5 held.

Shares of Infosys were trading at Rs. 2,668.45, down 0.55 per cent over the previous close on BSE.

During the fiscal, income from software services, products and business process management rose to Rs. 22,742 crore from Rs. 21,693 crore in the previous fiscal (2008—09).,

“We have been able to take advantage of the opportunities in the market and grow faster due to our investments in capacity and capability building even during the economic downturn,” Infosys CEO and MD S. Gopalakrishnan said.

Infosys, which has Goldman Sachs, BT Group and BP Plc among its clients, added 47 clients during the quarter.,

At the end of March 31, the company had 1,13,796 employees, which includes a net addition of 3,914 staff during the fourth quarter.

“Though the economic environment continues to be challenging, businesses are investing in growth for building a better future,” Mr. Gopalakrishnan added.

On a standalone basis, the company has posted a net profit at Rs. 1,430 crore for the March quarter, a decline of 8.85 per cent over the same period last fiscal.

(5) Industry posts 15.1% growth in February

For the third month in a row, the country’s industrial production maintained a high growth of over 15 per cent, signalling that the recovery process is on firmer ground.

However, with industrial growth at 15.1 per cent for the month, as measured by the index of industrial production (IIP) data released on Monday, it is lower than 16.7 per cent growth achieved in January this year and a robust 17.6 per notched up in December last year. Ostensibly, the slippage is owing to the partial withdrawal of the stimulus measures coupled with the moderation in output winessed by sectors such as cement and steel.

According to Crisil’s principal economists D.K. Joshi, the growth in industrial production would moderate in the coming months due to the base effect and further tightening of the monetary policy by the Reserve Bank of India (RBI). and monetary policy tightening by the RBI. Overall, I expect GDP growth to be around 7.2 per cent in 2009-10," Crisil Principal Economist DK Joshi said.

However, the fact remains that the over 15 per cent growth witnessed in February has been led by manufacturing, especially the capital goods sector followed by consumer durables, showing thereby that the growth – despite the advantage of a low base of 0.2 per cent in February 2009 – is being driven by investment by corporates and higher consumption. The manufacturing sector, which is leading the recovery, posted a growth of 16 per cent during the month.

The IIP data reveals that consumer durables, the sector that was particularly impacted by the global meltdown, logged a growth of 29.9 per cent in February this year while mining and electricity generation also notched up decent growth rates of 12.2 per cent and 6.7 per cent, respectively.

Thus, for 2009-10, the first 11 months of the fiscal year witnessed a growth of 10.1 per cent as compared to three per cent in 2008-09. The healthy performance of the industrial sector is likely to reassure policy makers that they can remove stimulus without disrupting the economic growth momentum.

As per the IIP data, 14 out of the 17 industrial groups showed positive growth in February 2010. According to the use-based classification, the capital goods and consumer durables sectors recorded high growth of 44.4 per cent and 29.9 per cent respectively.

The slide in specific industries such as cement and steel was expected, as was clear from the core sector data which had earlier revealed a deceleration in cement output to 5.8 per cent in February as compared to a growth of 8.3 per cent in the same month in 2009. Likewise, the growth in production of finished steel also slipped to 0.9 per cent from 2.4 per cent during the specific months.

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