Govt may hike tax deduction limit for home loans in Budget

New Delhi: Will it be a populist budget for the ‘already-in-trouble’ construction industry?  If sources from the Finance Ministry are to be believed, middle income group, who are dreaming to buy a home, will see their dreams coming true after the budget as government may double the housing loan interest tax exemption limit from the current Rs 1.5 lakh to Rs 3 lakh. The Budget is scheduled to be tabled on March 16.

At present, a deduction of up to Rs 1.5 lakh is available from taxable income towards interest on loan taken for house. Besides, borrowers can enjoy exemption on payment of principal amount. However, it is part of exemption to savings capped at Rs 1 lakh per annum under 80C.

With the property prices and interest rates rising with each passing year, there is need to revise the limit, PTI, quoting government sources, said.

In order to arrest the declining growth rate, the industry associations have demanded raising the tax limit ceiling for the housing loan.

According to FICCI Secretary General Rajiv Kumar the exemption should be harmonised with the rising interest rates and increased to at least Rs 2.5 lakh.

"We recommended that the existing tax deduction limit on income tax of an individual should be increased from the current level of Rs 2.5 lakh to at least Rs 5 lakh," CII Director General Chandrajit Banerjee said.

Of this, Rs 3 lakh should be towards interest payment to offset the impact of high interest rates, he said, adding the remaining Rs 2 lakh should be exclusively towards principal loan repayment as the present limit of Rs 1 lakh is already overcrowded with several other items.

Echoing views, ASSOCHAM and PHD chamber said that exemption limit needs to be raised both for interest and principal.

As per the Direct Taxes Code, which would replace the decades old Income Tax Act, there is income tax exemption for up to Rs 1.5 lakh paid as interest on housing loans in a year.

Government may ban solar energy equipments import

New Delhi: In an effort to encourage power generation through renewable energy sources, the government will limit imports and encourage domestic manufacturing through Public Private Partnerships (PPPs) to boost solar energy generation as power consumption goes up dramatically with the fast-growing economy, minister for new and renewable energy Farooq Abdullah has said.
Foreign companies must set up manufacturing facilities along with research and development centres if they want to enter India for solar power generation, he said while inaugurating a conference organised by The Associated Chambers of Commerce and Industry of India (ASSOCHAM) on Wednesday.

About 170 megawatt capacity of grid solar power has already been set up under the Jawaharlal Nehru National Solar Mission. During its first phase, 1,100 MW capacity is envisaged by 2013. In the second phase, additional capacity of 10,000 MW capacity for various off-grid applications has been sanctioned.

“This scale-up will require a paradigm shift in the approach. We must continue to rely more on the regulatory framework, development of transmission infrastructure and developing innovative business models. The sector will require an investment of 20 billion dollars by 2017,” said  Abdullah.

The challenge is to introduce newer and efficient technologies which can lead to cost reduction and ultimately help in grid parity, he said adding there is need to grab opportunities in developing partnerships in all spheres of research, development, designing and setting up projects.
Meanwhile, ASSOCHAM president Rajkumar Dhoot said the country is endowed with vast solar energy potential and 5,000 trillion kilowatt hour per year energy is incident over the land area with most parts receiving four to seven KWh per square metre daily.

Hence both technology routes for conversion of solar radiation into heat and electricity – solar thermal and solar photovoltaic – can be effectively harnessed providing huge scalability. Mr Dhoot said the government should allocate a substantial portion of clean energy fund to service capital requirements of solar energy projects at low bank interest rates.

Others present during the conference were Pramod Deo, chairman of the Central Electricity Regulatory Commission, Anil Agarwal, past president of ASSOCHAM, Rakesh Bakshi, chairman of ASSOCHAM council on new and renewable energy, and N.K. Bansal, former head of department at Indian Institute of Technology’s centre for energy studies.

They said solar energy applications are cost effective in remote and far-flung areas where grid penetration is not feasible. These applications ensure that people without access to electricity move directly to solar power by leap frogging the fossil fuel growth trajectory.
 
Also, the mobile phone network infrastructure in the country consists of more than three lakh towers with 3,000 new ones being added every month. By 2015 India is expected to have over five lakh telecom towers with almost all of them having a diesel back-up. This is another area where solar power can play a substantial role.

Kotak backs Sunteck’s Rs 300 cr land deal in Goregaon

Nestled on either side of the railway line by the Western Express Highway and the Linking Road, Goregaon is fast becoming hot destination for real estate enthusiasts. Land prices are hitting the roofs with more and more mega projects coming up in this western suburb. Not to left  behind in the realty boom, Sunteck Realty is negotiating to buy a huge piece of land in this wealthy suburb for a mixed-use development.

Kotak Realty, the private equity arm of Kotak Mahindra Bank, is backing the Mumbai-based real estate developer Sunteck Realty Ltd’s plan to acquire about 16 acres of land in Goregaon West, Mumbai. The deal involves Sunteck Realty acquiring the land parcel for Rs 300 crore, with Kotak Private Equity pitching in with Rs 150 crore in the transaction.

Interestingly, Kotak’s realty group is increasing its bet on Sunteck Realty as it already holds 9.5 per cent stake in the listed parent through Kotak Alternate Opportunities India Fund. Kotak Realty Group has also invested Rs 100 crore in Sunteck’s Star Light Developers, which is developing a residential complex in Bandra.

The share price of Sunteck closed at Rs 371 a unit on Thursday, up 0.84 per cent after rising more than 3 per cent in intra-day trade, reports Vccircle.

The deal would further expand Sunteck’s presence in Goregaon West, where it already owns seven acres within a distance of 200 m of the current acquisition. The project, proposed on 16 acres of land, will enable the company to develop approximately 4 million sq. ft. of multi-use development with a predominant share of residential development, in addition to commercial and community retail locations.

The land parcel is located just off the elevated link between SV Road and Western Expressway, which is under construction, and in close proximity to two major stations on the Western Line.

“This is yet another example of how Sunteck Realty has built out a portfolio of properties across Mumbai, with near-term cash flows through aggressive acquisitions in each down cycle of the property market. Along with our residential development in Bandra Kurla Complex, Goregaon has emerged as the next most valuable destination for the company with 23 acres in total for two projects, which would roughly involve 5-6 million sq. ft. of developable area,” said Kamal Khetan, CMD of Sunteck Realty.

“Sunteck has a total of 23 acres in Goregaon West, spread over two projects, which we believe has emerged as one of the most desired locations in the western suburbs, given the proximity to world class malls, educational institutions, hospitals and commercial hubs in the city. We believe that with this acquisition, Sunteck Realty will now have a long-term play in this prominent suburb in the medium term, with the proposed multi-use developments in the immediate neighbourhood,” said Hari Krishna, director of Kotak Realty Fund.

India's GDP growth slows to 6.1% in Q3

India’s GDP growth has registered a moderate increase of 6.1 per cent for Q3 2011-12 compared to the corresponding quarter last year with key indicators of construction sector -- cement and consumption of finished steel -- registering significant growth of 9.4 per cent and 10 per cent, respectively, while agriculture, which used to contribute majorly for GDP growth was pegged messily at 2.7 per cent.

However, the GDP growth is slower than the 6.9 per cent in the September quarter, and has been declining for the past nine quarters. This is also the lowest in the past 13 quarters.

Finance Minister, Pranab Mukherjee termed the third quarter GDP number of 6.1 per cent as "disappointing" but expressed the hope that economy will register a growth of 7 per cent for the entire fiscal. "No doubt, it is disappointing 6.1 per cent ... but not unexpected," he said. "If, I take first quarter, second quarter, third quarter taken together, it is also indicating a downward trend," he said.

In a data released by the Ministry of Statistics and Programme Implementation on Wednesday, construction and real estate sections have registered 7.2 per cent and 9 per cent, respectively while electricity, gas and water supply sectors clocked 9 per cent growth, trade, hotels, transport and communication at 9.2 per cent and financing, insurance and business services at 9 per cent. The growth rate in ‘agriculture, forestry & fishing’, ‘mining and quarrying’ and ‘manufacturing’ is estimated at 2.7 per cent, -3.1 per cent and 0.4 per cent, respectively in this period. 

According to the Department of Agriculture and Cooperation (DAC), which has been used in compiling the estimate of GDP from agriculture, the production of coarse cereals and pulses during the kharif season of 2011-12 is estimated to have declined by 4.6 per cent and 10.3 per cent respectively while rice has increased by 11.8 per cent over the corresponding season in the previous agriculture year.   Among the commercial crops, the production of oilseeds is estimated to have declined by 5.1 per cent during the Kharif season of 2011-12, while the production of sugarcane and cotton is expected to grow by 1.6 per cent and 3.3 per cent, respectively, during the agriculture year 2011-12. However, horticultural crops and livestock products are expected to grow at 2.6 per cent and 4.7 per cent, respectively, during 2011-12, a government release said.

According to the latest estimates available on the Index of Industrial Production (IIP), the index of mining, manufacturing and electricity have registered growth rates of -4.6 per cent, 0.8 per cent and 9.6 per cent, respectively as compared to the growth rates of 6.3 per cent, 9.2 per cent and 6.5 per cent in these sectors in Q3 of 2010-11.  In the mining sector, production of coal and crude oil have registered growth rates of 0.8 per cent and -4.1 per cent in Q3 of 2011-12, as against the growth rates of 1.6 per cent and 15.5 per cent in Q3 of 2010-11. 

Among the services sectors, the key indicators of railways, namely, the net tonne kilometers and passenger kilometers have shown growth rates of 5.3 per cent and 5.6 per cent, respectively, as against the growth rates of 4.0 per cent and 6.2 per cent, in the corresponding period of previous year.  In the transport and communication sectors, the sale of commercial vehicles, cargo handled at major ports, cargo handled by the civil aviation and passengers handled by the civil aviation registered growth rates of 22 per cent, -4.8 per cent, -2.8 per cent and 12.9 per cent, respectively over Q3 of 2010-11. 

The key indicators of banking, namely, aggregate bank deposits and bank credits have shown growth rates of 11.9 per cent and 10.7 per cent, respectively during April-December, 2011-12 over the corresponding period in 2010-11.  

  

Wholesale Price Index

The wholesale price index (WPI), in respect of the groups food articles, non-food articles, fish, minerals, manufactured products, electricity and all commodities, has risen by 6.3 per cent, 4 per cent, 20.4 per cent, 22.4 per cent, 7.9 per cent, 2.6 per cent,  and 8.9 per cent, respectively during Q3 of 2011-12, over Q3 of 2010-11. The consumer price index for industrial workers (CPI-IW) has shown a rise of 8.4 per cent during Q3 of 2011-12 over Q3 of 2010-11.

Energy efficient lights can save Rs 4.7 lakh crore

As power-starved Indian states are contemplating ways to negotiate steep rise in power demand during Summer, saving power through energy-efficient electrical apparatus becomes an inevitable option for the residents to check the mounting power bills.

To spread the awareness about using energy-efficient electrical fittings, India’s leading industry body ASSOCHAM has conducted a study, according to which, “Widespread use of new and efficient lighting devices can save nearly 35,000 megawatt of power and the nation can gain Rs 4.7 lakh crore.” 

The devices include light emitting diodes (LEDs) and compact fluorescent lamps (CFLs). Implementation of this lighting efficiency option will cost about Rs 50,000 crore, said the study.

One LED used in a household can save 54 watt per connection at the consumer end when a 6 watt LED replaces a 60 watt incandescent lamp (ICL) – the conventional light bulb. The consumer will save 16 paise for every hour of lighting use at an average domestic tariff of Rs 3 per kilowatt hour.

LEDs have typical efficiencies of 110 lumen per watt and an operating life of 50,000 to 80,000 burning hours as compared to a pitiable 5 to 20 lumen per watt and life of only 1,000 burning hours for the commonly-used incandescent bulb, said the ASSOCHAM study titled ‘Encashing Lighting Energy Efficiencies – A National Strategy Document.’

Though relatively expensive at present, LEDs are basically solid state devices that convert electric energy directly into light of a single colour. CFLs too consume only 20 per cent of electricity for the same light output and can last 10 to 13 times longer than the standard incandescent bulb.

Spreading awareness among consumers, government policy support, standardisation of products, demonstrations and industry involvement are key to bring in attitudinal changes, said the study.

It added that a 50:50 thermal:hydro mix in the newly planned generating capacity could result in national savings of Rs 5.2 lakh crore.

ASSOCHAM recommended an aggressive and widespread expansion of the government’s energy star labelling and Bachat Lamp Yojana (BLY) to cover all kinds of lighting devices which provides CFL to households at a price of incandescent bulb and utilise the clean development mechanism of Kyoto Protocol to recover the cost difference and reduce emissions to protect the global environment.

The Bureau of Energy Efficiency (BEE), a statutory body under the union power ministry, had launched the project in February 2009 to replace 400 million ICLs with CFLs across the country.

The scheme envisages providing two CFLs of 14 or 16 watts which cost around Rs 70 each when bought in bulk to every electrified household at a subsidised price of Rs 15 per lamp in exchange for two ICLs.

Xylem unveils energy efficient products for building services industry

Vadodara: Xylem India, a leading global water technology provider, has enhanced its building services portfolio by introducing two new packaged system products that bring innovation to the pump industry in India. Backed by industry-leading systems and application expertise, Xylem's new HVAC and Fire Skid Systems are designed to limit energy consumption, lower lifecycle operating costs and enhance reliability.
The company's Bell & Gossett and Lowara brands are leaders in energy-efficient systems for commercial buildings.

The primary-secondary and primary variable technology deployed in both the HVAC and the Fire Skid systems can deliver energy savings as high as 25-30%. Over and above, these savings the skid also helps save on piping, civil engineering and installation costs, according to a company statement.

With legislative efforts in all regions targeting water and energy conservation and LEED projects increasing exponentially across India, Xylem's system and application expertise enhances overall system efficiency and is well geared to deliver on all these counts. These two recently launched packaged systems are also well-suited to support eco-commercial buildings.

Xylem India has introduced a packaged Bell & Gossett HVAC skid system specifically designed to meet the requirements of chilled water systems in a commercial building. It includes a range of HVAC products that are brought together to minimize installation time, reduce material costs and improve the quality of assembly.
This intelligent and highly efficient system provides a packaged pumping and control solution for a constant-primary/variable-secondary chilled water system. It is compact and occupies a smaller footprint, helping the system designer optimize mechanical room space.
Bell & Gossett offers a complete package system including pumps, controls, valves, air separators, expansion tanks and other system components. That experience translates into reduced energy consumption, as well as reduced installation and maintenance costs.
Xylem is also introducing its Lowara Fire Fighting Skid System. Suited to satisfy local fire TAC requirements it includes all pumps, valves, switches, controls, tank, and engine, all mounted on a single base frame. This highly compact product has a small footprint and doesn't require a large room for its installation. This product is "ready to play" and requires only two pipe connection to install which leads to significant savings in time and installation cost.

Xylem provides a variety of system configurations to meet diverse needs - whether for new construction, retrofit or where space is at a premium. Configurations are almost limitless, from the simplest to the most sophisticated systems.

About Xylem

Xylem is a leading global water technology provider, enabling customers to transport, treat, test and efficiently use water in public utility, residential and commercial building services, industrial and agricultural settings. The company does business in more than 150 countries through a number of market-leading product brands, and its people bring broad applications expertise with a strong focus on finding local solutions to the world's most challenging water and waste water problems.

 Launched in 2011 from the spinoff of the water-related businesses of ITT Corporation, Xylem is headquartered in White Plains, N.Y., with 2010 annual revenues of $3.2 billion and 12,000 employees worldwide.