QBiz: Govt to Roll out Low-Cost Crop Cover, Gold at 4-Month Low

QBiz: Read the top business stories of the day.

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A farmer spreads pesticide in his paddy field. (Photo: Reuters)

1. Lower-cost Crop Cover on Cards

A new crop insurance scheme the Modi government is set to roll out shortly seeks to cap the premium paid by farmers at about 3 percent of the insured value, cover a substantial part of the country’s farmland and crop output and make processing of claims hassle-free.

The proposed easier crop insurance that would appeal to farmers replacing the existing high-premium schemes is one of the major social sector reforms the BJP-led coalition is banking on to regain its popularity among the masses after the party’s dismal performance in the recent Bihar assembly election.

Read more here.

2. CCI Fines IndiGo, Jet, SpiceJet for Cartelisation

The country’s fair trade regulator on Tuesday found Jet Airways, IndiGo and SpiceJet guilty of colluding in fixing fuel surcharge rates for transporting cargo. The Competition Commission of India (CCI) in its final order passed on Tuesday imposed a fine totalling Rs 257.91 crore on the three carriers.

The order was passed in response to a complaint filed by Express Industry Council of India, a body representing companies including Blue Dart, Fedex and DHL, among others.

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3. By 2016, Biometrics to Plug PDS Leakages

The Narendra Modi-led government is aiming big on Aadhaar-based biometric authentication, which it plans to roll out at all fair price shops across the country by end-2016. It is also looking to use the mechanism to identify beneficiaries of kerosene subsidies, Business Standard has learnt.

The Centre, with help from states, has already rolled out biometric authentication facilities in around 50,000 fair price shops, including 44 in Delhi, to identify beneficiaries of subsidised foodgrains under the public distribution system. There are around 500,000 fair price shops in all states and Union territories combined.

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4. Indian Railways Hikes Minimum Train Fare From Rs 5 to Rs 10

The minimum train passenger fare will go up from Rs 5 to Rs 10 as Indian Railways has decided to increase the minimum chargeable fare in non-suburban services at par with the platform ticket from November 20.

The platform ticket price was revised from Rs 5 to Rs 10 in April this year as proposed in the rail budget with a view to control the rush on platforms.

Read more here.

5. Gold at 4-month Low, Plunges By Rs 450 on Weak Global Cues

Gold prices today plunged by Rs 450 to trade at almost four-month low of Rs 25,700 per 10 grams at the bullion market, tracking a weak global trend amid subdued demand from jewellers and retailers. Silver also fell sharply by Rs 500 to Rs 34,100 per kg on reduced offtake by industrial users and coin makers.

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6. Dalal Street Bullish on Companies Focused on Urban Consumption

Is urban consumption the new investment theme on Dalal Street? As rural India slows because of shrinking farm income, investors are stocking up on shares of companies that focus on consumers in bigger cities and towns. Analysts said investors could opt for Britannia, Bajaj Finance, Jubilant Foodworks, Marico and Bajaj Corp among others to bet on firming urban demand.

Investors’ appetite for these stocks is a stark contrast to the situation till last year when companies with a rural focus were popular with them.

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7. Aided by a Turnaround in Fortunes, SpiceJet in Talks to Buy 150 Aircraft

Emboldened by a quick turnaround in fortunes under its new promoters, budget airline SpiceJet has initiated talks with aircraft manufacturers to place orders for at least 150 planes, said Ajay Singh, chairman of India’s fourth largest carrier.

SpiceJet is in talks to buy 100 narrow-bodied aircraft (Boeing 737 MAX or Airbus 320 Neo) and 50 turboprop aircraft.

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8. Infrastructure Project Budgets May Exclude Land Cost for Faster Clearances

The government could soon give the go-ahead to excluding the cost of land while computing the total cost of infrastructure projects, a measure that will allow more ministries to clear their own projects without going through the time-consuming process of seeking the approval of the Cabinet Committee on Economic Affairs.

All infrastructure projects costing over Rs 1,000 crore have to be approved by the CCEA and given the high cost of land, many projects will remain below the threshold if this component is not included in the project cost.

Read more here.

9. Earnings Estimates Cut for Third Year

A dismal September earnings season – in which aggregate sales for the Sensex fell for the fourth consecutive quarter, a first – has forced analysts to downgrade earnings estimates for both this year and FY17.

This is the third straight year the Street has been downgraded on profit estimates and it may not be the end of it. “We see another two to three-quarters of earnings cuts until the economy gathers momentum,” Kotak Institutional Equities (KIE) said in a report.

Read more here.

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