World Bank raises China forecast

The World Bank has raised its forecast for growth in China this year from 6.5% to 7.2% amid signs that the economy is doing better than expected.

Bank analysts say the government's four trillion yuan ($585bn, £358bn) stimulus package has helped the economy.

But it says the country's exports are still down, as the rest of the world struggles with the global recession.

The World Bank believes the global economy, excluding China, will shrink by about 3% this year.

"Developments in the real economy [in China] have been somewhat better than expected three months ago," says a report published by the bank.

'No meaningful increase'

It predicted in March that the Chinese economy would grow by 6.5% in 2009, several percentage points down on last year's growth.

But the government stimulus package, and increased bank lending, has protected the economy from the worst effects of the global recession, leading the bank to raise its growth forecast.

"Growth in China should remain respectable this year and next, although it is too early to say a robust, sustained recovery is on the way," said Ardo Hansson, the bank's leading economist in China.

But it is not all good news. China's export sector has been one of the hardest hit parts of the economy and has still not recovered.

This has led to millions of migrant workers - farmers who leave their villages to find work in China's factories - losing their jobs.

"We have not had a meaningful increase in exports since last year's plunge," said World Bank economist Louis Kuijis, speaking at a press briefing to launch the bank's latest China predictions.

Some migrant workers who lost their jobs late last year told the BBC they had still not been able to find new jobs.

Tripura thermal power project gets CCEA nod

The Cabinet Committee on Economic Affairs (CCEA) has approved a 100 MW gas-based thermal power project at Monarchak in West Tripura district, official sources said.

The decision was taken on Friday by the CCEA in New Delhi, sources said.


According to officials of North East Electric Power Corporation (NEEPCO), the estimated cost of the power project is Rs 421 crore.


NEEPCO has spent Rs 27.47 crore on infrastructure of the project. The corporation would make 30 per cent contribution to launch the project while 70 per cent of the funds would be borne by selling equity.


The project would be operational in 30 months and Tripura would procure the entire production of 100 MW.



NEEPCO has inked a deal with the state government and also signed an agreement with ONGC to get natural gas to feed the power project.


Sources in ONGC said they would soon begin exploration of gas in the state for the project as there is a huge recoverable gas stock in Tripura.

Stanford charged with fraud in US

Texan billionaire Sir Allen Stanford has been charged in the US with fraud and obstruction.

Announcing the indictment, the justice department said it related to a $7bn ($4.2bn) scheme to defraud investors.

Soon after, the 59-year-old appeared in court in Virginia and was remanded in custody pending a full detention hearing to be held in Texas.

He already faces civil charges over an alleged fraud worth $8bn - charges he denies.

Sir Allen turned himself in to the FBI on Thursday after a warrant was issued for his arrest.

Govt role in gas dispute crucial; can't lose revenue: Deora

Asserting that nothing could be done on the K-G gas dispute without the active involvement of the govt, Petroleum Minister Murli Deora said that warring Ambani brothers had met him after the Bombay High Court ruling on the row on 15th June.

The government wants early solution to the gas dispute as it cannot afford to lose revenues, Deora told reporters in Mumbai on Friday



"I am in touch with them (Ambanis), the brothers are "not very friendly, unfortunately," he added.


The Bombay High Court on Monday asked Mukesh Ambani-led Reliance Industries (RIL) to supply gas from the K-G basin at USD 2.34 mmBtu to younger brother Anil Ambani group firm Reliance Natural Resources (RNRL).


A division bench of Justices J N Patel and K K Tated asked the two companies to enter into a fresh "suitable agreement" within a month.


Meanwhile, RNRL has filed a caveat before the Supreme Court to preclude the chances of an ex parte (in the interest of one party only) being passed against it on the gas sharing deal it had signed with Mukesh Ambani-led RIL.



"We are trying our best to find a solution to the gas dispute. In no way can the government afford to lose the money. We need the revenues from K-G gas for development of the country," Deora said.


He, however, declined to divulge details of his meetings with Ambanis.

More optimism from Japan

The Bank of Japan (BOJ) has said the Japanese economy has begun to stop deteriorating, but it has still kept interest rates unchanged at 0.1%.

The assessment was more optimistic than at last month's meeting, when it said the economy was continuing to worsen.

It made no change to policies such as buying corporate bonds, the current programme of which ends in September.

The improved view of the economy had been expected given the recent rises in factory output.

Conditions 'still terrible'

"We may be seeing a return to growth in Japan later this year so it is reasonable for the BOJ to upgrade its assessment now," said Shane Oliver, chief economist at AMP Capital Investors in Sydney.

"However, conditions are still terrible. Japan and other economies are still in the midst of a severe recession."

The key question is what will happen to the central bank's programme of buying bonds later in the year.

In common with many other central banks, the BOJ has been buying corporate bonds as part of a programme of quantitative easing, to get more money flowing through the economy.

"As for measures on credit markets, the issuance of corporate bonds is rising and the bank may start scaling back those steps if conditions allows after September," said Junko Nishioka, chief economist at RBS Securities in Tokyo.

But he warned that "although there has been some optimism on the economy after strong industrial output data, the BOJ is maintaining a very pessimistic view".

"It said the economy has begun to stop worsening, but it didn't say it has stopped worsening."

GM agrees Saab sale to Koenigsegg

General Motors has reached a tentative agreement to sell Saab to the Swedish sports car manufacturer Koenigsegg.

GM said that as part of the deal there would be $600m (£367m) of funding from the European Investment Bank (EIB), guaranteed by the Swedish government.

It is the latest part of GM's reorganisation, which is also set to see the Opel and Vauxhall brands going to Canada's Magna.

Saab filed for reorganisation under Swedish law on 20 February.

Koenigsegg produces 18 cars a year and employs 45 people, and there has been some doubt as to whether it has the expertise to run Saab, which sold 93,000 cars in 2008.

Saab employs about 3,400 people in Sweden and about 12,000 other jobs in the country are dependent on Saab and its suppliers.

But GM Europe's president Carl-Peter Forster said: "Koenigsegg Group's unique combination of innovation, entrepreneurial spirit and financial strength... made it the right choice for Saab as well as for General Motors

Kingfisher Airlines hikes fuel surcharge by Rs 400

Air carrier Kingfisher Airlines on Wednesday increased fuel surcharge by Rs 400 on all domestic sectors with immediate effect.

"Consequent upon successive increases in the price of ATF, the fuel surcharge for travel on all domestic sectors of Kingfisher Airlines will be increased by Rs 400 with effect from Wednesday," a Kingfisher Airlines spokesperson said.


The hike would apply uniformly for travel across all distances and all classes of travel including Kingfisher Red, the spokesperson said.


The increase in fuel surcharge comes following an over 12 per cent rise in ATF prices by state-run oil firms on 15th June.

India, US agree to increase civil aviation cooperation

India and the United States have agreed to increase their level of cooperation in theaviation sector, including its modernization, and to meet the challenges in view of its rapid expansion.

The decision in this regard was taken following a series of meetings of visiting Indian delegation led by the Civil Aviation Secretary Madhavan Nambiar with members of the Obama

Administration.



During the meetings, the two sides discussed the future direction of the bilateral cooperation, said the Indian

Embassy in a statement.



The two countries agreed to work towards making Aviation Cooperation Program (ACP), signed in June 2007, more productive for India in its efforts to modernise the sector and meet challenges of rapid expansion in terms of safety, technology and communication support and air space management, the statement said.



It was agreed that the next Indo-US Aviation Summit would be held in the US in December 2009.



An agreement was also signed between the US Trade & Development Agency and Directorate General of Civil Aviation of India to fund projects under the US-India ACP, besides reviewing the progress of the Open Skies Agreement, 2005.



Over 2004-07, India imported more than USD 11 billion worth of aviation-related products from the US.

'India to work for developing nations in tackling recession'

President Pratibha Patil said that India will work towards ensuring representation of developing countries in global financial institutions while dealing with the economic crisis.

In an interaction with envoys from Maldives, Gambia and Sudan, Patil said on Friday while dealing with the current global financial crises, the long-pending issue of representation for developing countries in global financial institutions would be addressed.


Three High Commissioners Abdul Azeez Yoosuf (Maldives), Felix Badji (Gambia), and Khider Haroun Ahmed Abdulrazig (Sudan) presented their credentials to the President at a ceremony in Rashtrapati Bhavan in New Delhi on Friday.


This was the first Credentials Presentation Ceremony since the formation of the new government.


The President also talked about the recently held general elections in the country and massive mobilization of polling personnel for the conduct of the polls, a Rashtrapati Bhavan spokesperson said.


Patil said India would continue to work for peace, stability and development in its region and the world.


She also told the envoys that India wants to improve its bilateral relations with their countries.


The ceremony was attended by senior members of the missions and officials of the External Affairs Ministry.

Japanese stocks on a rise

The Nikkei index of leading Japanese shares has closed above 10,000 points for the first time in eight months.

The Nikkei-225 stock average closed up 154.49 points at 10,135.82 points, as global recovery hopes grew.

Investors were encouraged by a revised 5.9% rise in industrial output in April, the biggest gain in half a century.

Better-than-expected US sales and jobs data on Thursday also spurred hopes of a recovery.

The April data was revised up from 5.2% and was the biggest monthly gain since 1953.

The Nikkei has risen 44% since it reached a low of 7,000 on March 10 and 3.8% in the past week.

Among the gainers on Friday were CSK Holdings, up 19.05% at 500 yen, Nippon Soda, up 11.48% at 476 yen and Yahoo Japan, up 8.29% at 30,550 yen.

Industry grows 1.4% in April; solid show power generation

Giving early signs of economic recovery, industrial production grew 1.4 per cent in April after contraction for months together since September when global financial crisis deepened.

However, certain crucial sectors like consumer non-durables, including processed food products and capital goods posted negative growth.



Processed food items declined by a whopping 34 per cent.



Also, 1.4 per cent growth in factory output is no match for the 6.2 per cent expansion it clocked in the same month last year.



Nonetheless, slowdown in industrial growth, as measured by the Index of Industrial Production (IIP), appears to be bottoming out.



Provisional figures showed industrial contraction for almost every month since Lehman Brothers filed for bankruptcy in mid-September last year which deepened the global financial meltdown.



"We have bottomed up and we are on a path of recovery," economic think-tank National Institute for Public Finance and Policy's Director Govinda Rao said.



However, the good news on industrial production failed to enthuse the stock markets with benchmark equity index Sensex shedding nearly 153 points at 15,355 points at mid-session.



The biggest surprise in IIP data was the electricity generation which grew by 7.1 per cent in April against 1.4 per

cent in the same month a year ago.