Good News from India

A change of Ministers in India has led to several key initiatives which affect our shares. These were ratified Friday at a Cabinet meeting. First the global retailers will be allowed to open with majority shares. This is big news for Carrefour and Tesco as it opens up huge markets. The retail sector in India is estimated as US$500bn.  Secondly the government has backed of trying to tax telecomms companies such as Vodafone which will take some of the risk area out of their price. At one point the Indian government was threatening them with multi billion fines. This reported below from the New York Daily News is good news.



The government in New Delhi said last November that it would allow 51pc foreign direct investment in "multi-brand retail" only days later to be forced into a humiliating U-turn as key coalition parties threatened to veto it.

Since then the suspended reform has become a symbol of the Congress-led government's paralysis. It has been mired in corruption controversies over the allocation of coal blocks and 2G mobile phone operator licences, while key economic reforms were put on the back burner.

Its new determination to push through economic reforms and reassure investors follows the appointment of former home minister P Chidambaram as finance minister. Since he was hired, the government has suspended plans to levy vast tax bills retroactively on foreign investors like Vodafone.

Friday's cabinet meeting also voted to increase foreign direct investment levels in domestic airlines to 49pc in an attempt to revive its ailing airline industry and allow foreign airlines to take a stake in Kingfisher, the heavily-indebted carrier owned by the flamboyant drinks billionaire Vijay Mallya. British Airways, Emirates and Singapore Airlines are believed to have indicated an interest in his airline in the past year.

The decision to open the doors to supermarket chains like Tesco, Walmart and Carrefour will be left to individual state governments but ministers expect all the Congress-led states and several other progressive states, like Punjab and Gujurat, which is governed by the BJP, to follow suit.

Read more: http://india.nydailynews.com/politicsarticle/cefaa25c4d5e9de468586610b7ff7a50/tesco-and-walmart-get-green-light-to-move-into-india#ixzz26X4Jk7BA