Expect major agri reforms from Modi govt: Arun Shourie

Arun Shourie also made a case to axe the controversial retrospective amendment to tax laws.

Fiscal consolidation, reviving investments and big bang reforms, Arun Shourie expects the new government to get India back on the high-growth path. Speaking exclusively to CNBC-TV18's Manasvi Ghelani, the former divestment minister in the Vajpayee government says he expects major agriculture reforms from the Modi government. Shourie also made a case to axe the controversial retrospective amendment to tax laws.

Below are edited excerpts from the interview:

Q: What kind of reforms are you expecting from the new government?

A: First is fiscal consolidation, second is changing the rules of doing business in India and that should mean that you raise resources in imaginative ways because you can't raise it through taxes on other ways. But in holding companies or public sector undertakings (PSUs), for all PSUs on the manufacturing side you can really raise a lot of resources. Similarly, another holding company in the banks and you re-capitalise the banks by first taking out the bad assets. These are ways in which unlimited amounts of money can be raised.

One small estimate that Raghav Bahl had made was that you can raise anywhere between USD 500 billion to one trillion dollars for infrastructure investments just by the holding companies for PSUs. That will relive the government from pressure on the budget. So those things should be done.

Q: Talking about the agri reforms, what are your views in that particular segment?

A: I am not an expert in agriculture but I certainly feel the idea that you can go on raising minimum support prices and on the other side that will not impact inflation; it is not possible.

Q: On the retrospective tax, do you think that should be amended or the court should be given the contractual validity?

A: No. One of the most retrogressive things was the legislation to overturn the Supreme Court judgement and impose retrospective taxation and it will be very good that the government should announce that we will never go in for retrospective taxation. Secondly, we will contest you till the High Court, but we will not contest you in the Supreme Court if we lose. That assurance should be given. Thirdly, the most important point is that tax administration has gone completely haywire.

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Gold gains on Iraqi violence, U.S. data cap gains

Investing.com - Investing.com - Gold futures rose on Monday due to safe-haven demand from investors worried over chaos erupting in Iraq, though upbeat U.S. indicators watered down gains by reminding investors that monetary stimulus tools in the U.S. are on their way out.

On the Comex division of the New York Mercantile Exchange, gold futures for August delivery traded at 1,274.60 a troy ounce during U.S. trading, up 0.04%, up from a session low of $1,272.60 and off a high of $1,285.10.

The August contract settled up 0.01% at $1,274.10 on Friday.

Futures were likely to find support at $1,250.10 a troy ounce, Tuesday's low, and resistance at $1,294.70, the high from May 27.

Concerns over the ongoing Sunni insurgency in Iraq continued to weigh on the dollar Monday by stoking fears that escalating conflict could dampen global recovery, especially if the conflict disrupts Iraqi oil exports, hikes prices at U.S. gasoline pumps and waters down the economy.

Geopolitical concerns boosted gold, as the yellow metal tends to trade inversely from the dollar, while news that the International Monetary Fund trimmed its 2014 U.S. economic growth forecast due to a harsh winter and 'still-struggling housing market' supported the precious metal as well.

The IMF said it now expects the U.S. economy to expand 2% in 2014, down from its forecast of 2.8% in April.

Positive U.S. data, meanwhile, capped gold's gains, as the numbers solidified market expectations for the Federal Reserve to wind down its monthly bond-buying program possibly this year.

The Federal Reserve Bank of New York reported earlier that its general business conditions index increased to 19.28 this month from 19.01 in May. Analysts had expected the index to decline to 15.0.

A separate report showed that U.S. industrial production rose by 0.6% last month, beating forecasts for a 0.5% gain.

Past and current Fed asset-purchasing programs have supported gold since the 2008 financial crisis by suppressing interest rates, which boosts gold's appeal as a hedge to a weaker dollar.

Meanwhile, silver for July delivery was down 0.01% at $19.653 a troy ounce, while copper futures for July delivery were up 0.59% at $3.048 a pound.

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Egypt cabinet formation delayed as PM continues talks

CAIRO (Reuters) - The expected formation of Egypt's new cabinet has been held up after several candidates turned down offers of ministerial positions from Prime Minister Ibrahim Melheb, two government sources said on Sunday.

Melheb is forming a new government following President Abdel Fattah al-Sisi's election victory last month. He had not been expected to make sweeping changes, and officials had said he would unveil his new cabinet on Sunday.

But government sources said on Sunday evening the premier was still trying to fill several portfolios.

"There have been apologies from some of the nominated candidates including those who were asked for the ministries of investment, justice, culture and information," one source said.

"The prime minister is still conducting talks and holding meetings to pick other new candidates for those ministries."

Both sources said it was unclear when the cabinet would be finalised, but Al-Ahram newspaper said it would be completed by Tuesday at the latest. The cabinet spokesman was not immediately reachable for comment.

The sources did not say why the candidates tapped to serve in Melheb's government had turned down the offers.

However since the 2011 overthrow of former President Hosni Mubarak several people have rejected cabinet jobs, fearing it could open them up to potential legal complaints after a number of former cabinet ministers faced charges of corruption or taking decisions which were not in the national interest.

Sisi reappointed Melheb as prime minister after his inauguration last Sunday. Government sources have said Finance Minister Hany Kadry Dimian is expected to stay, as are the ministers for planning and international cooperation, supplies, housing, industry, defence and interior.

Keeping the main ministers could allow Sisi to implement quickly the types of reform urged by the United Arab Emirates - one of the Gulf states that gave billions of dollars in aid after Islamist President Mohamed Mursi was ousted by the army in July in reaction to mass protests against his rule.

(Reporting by Yasmine Saleh; Editing by Mark Potter)

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Factbox - What is net neutrality? U.S. debates once again

(Reuters) - The U.S. Federal Communications Commission is collecting public comments until Sept. 10 on new "net neutrality" or "open Internet rules" that may let service providers charge content companies for faster and more reliable delivery of their traffic to users.

Below are some details about the concept of "net neutrality" and the FCC's work to regulate Internet traffic.

WHAT IS NET NEUTRALITY?

Net neutrality is a principle that says Internet service providers should treat all traffic on their networks equally. That means companies like Comcast Corp or Verizon Communications Inc should not block or slow down access to any website or content on the Web - for instance, to benefit their own services over those of competitors.

HOW IS NET NEUTRALITY REGULATED?

The FCC, which regulates telephone and cable companies that provide broadband service in the United States, has several times adopted rules aimed at ensuring Internet providers abide by the net neutrality principle.

In 2010, FCC passed an order that prohibited Internet providers from blocking traffic. It allowed "commercially reasonable" discrimination of traffic, but rejected potential "pay-for-priority" deals that may have allowed content companies to pay for faster delivery of their traffic.

Bit a U.S. appeals court in January ruled against the FCC in a case brought by Verizon, effectively striking down the agency's net neutrality regulations.

Comcast is the only Internet provider that has to abide by the older version of those rules until 2018, because of a condition placed on its acquisition of NBC Universal. All other major Internet providers have said they support an open Internet.

WHY DID THE COURT REJECT THE RULES?

In setting the 2010 rules, the FCC treated Internet providers like utilities similar to telephone companies, which are more heavily regulated. The U.S. Court of Appeals for the District of Columbia Circuit ruled that treatment improper because broadband providers were actually classified as less-regulated information service providers.

WHAT IS THE FCC'S NEW PLAN?

The court did affirm the FCC's authority to regulate broadband, indicating that the agency could use another section of the communications law to restore some of the rules.

Based on that guidance, the FCC has proposed new rules that would ban Internet providers from blocking users' access to websites or applications and would require them to disclose exactly how they manage traffic on their networks.

Under the proposal, some "commercially reasonable" deals to give priority to certain Web traffic may be allowed, although the FCC also seeks comment on whether "some or all" pay-for-priority deals should be presumed illegal.

The proposal also asks questions about potentially reclassifying broadband providers and how the FCC may address so-called "interconnection" deals that are currently outside the scope of net neutrality rules, but which have been in spotlight in Netflix Corp's recent spat with Comcast and Verizon.

WHY ARE CONSUMER ADVOCATES OPPOSED?

Consumer advocates say Wheeler's proposal would create "fast lanes" for companies willing to pay while leaving startups and others behind, which would potentially harm competition.

More than 100 technology companies including Google Inc, Facebook Inc and Amazon.com Inc have warned of a "grave threat to the Internet."

However, consumer advocates are pushing for reclassification of broadband providers as public utilities, while tech companies in their opposition to pay-for-priority have not supported reclassification.

WHAT DO OPPONENTS OF REGULATION SAY?

Internet providers say stricter net neutrality regulations could discourage investment in the expensive network infrastructure. Verizon, in its case against the FCC, argued that the rules amounted to government overreach into companies' business dealings.

Past efforts to regulate broadband providers more like telephone companies have drawn backlash from the cable and wireless industries and Republican lawmakers. Companies have argued that reclassification would create prolonged regulatory uncertainty without preventing pay-for-priority deals.

(Reporting by Alina Selyukh; editing by Andrew Hay)

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PM Modi warns of tough decisions ahead to improve economy

"I have taken over the reins of the country in circumstances when there is nothing left behind by the previous government. They left everything empty. The country's financial health has hit the bottom," Modi said.

With just a few days left for the commencement of Budget Session of Parliament, Prime Minister Narendra Modi on Saturday said that his Cabinet would take really tough measures to improve the economy of the country which is in shambles currently owing to the steps taken by the previous government.

Addressing BJP workers in Goa's Bambolim, PM Modi said, "In the coming years we will take tough decisions to improve the condition of country. People might even stop liking me in the coming times becuase of these tough decisions to improve the economy," said the PM dedicated the country's latest warship aircraft carrier INS Vikramaditya to the nation earlier in the day.

This is the first occasion in less than three weeks since taking over reins of power that Modi has made sharply critical comments on the previous Manmohan Singh government's performance.

"I have taken over the reins of the country in circumstances when there is nothing left behind by the previous government. They left everything empty. The country's financial health has hit the bottom," Modi said.

However, in the short run, such measures may not go down well with everybody, he said.

"I am well aware that my steps may dent the immense love that the country has given to me. But when my countrymen would realise that these steps would result in getting the financial health back, then I will regain that love," said the Prime Minister.

On the other hand, if these tough measures were not taken, the financial situation would not improve, he said, adding "we need to take action wherever required".

"We won't be helping the country by praising Modi and praising BJP. There is no guarantee that just singing praise of Modi would improve the situation. We need to take harsh measures to improve the financial situation," he said.

Shortly later, Modi tweeted that "time has come to take tough decisions in the interest of the nation. Whatever decisions we take will be solely guided by national interest".

(With inputs from PTI)

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Outlook for 10 day Monsoon Performance

Southwest Monsoon has been making a slow advancement after making a sluggish start this year. Nevertheless, according to the latest weather update rain is picking up now. Tropical cyclone 'Nanauk' had been restricting the actual outburst of Monsoon in India. Now that the system has weakened it lost its hold over the monsoon current, allowing free flow of westerly winds favourable for the Monsoon surge. Rain will gradually pick up from now on across the country. Here's an outlook of Monsoon performance in coming 10 days:

A small system developing in the Bay of Bengal in the form of a cyclonic circulation will enhance rain over the west coast of peninsular India. Monsoon rain will gradually pick up in Mumbai and the city will receive good showers next week. Intensity of rain over the interiors of South India will also increase gradually in coming 10 days. Southwest Monsoon will cover entire West Bengal, Bihar and touch east Uttar Pradesh by the 21st of June. Monsoon is still behind schedule as normally by the 15th it should have covered Bengal, Bihar and reached central parts of Uttar Pradesh. As of 13th June, the northern limit of monsoon (NLM) passes through- Ratnagiri, Agumbe and Madikeri in west coast, Chennai in east coast, And Coochbehar and Gangtok in Sub Himalayan West Bengal and Sikkim. The onset of Monsoon phase should normally witness significant rain and the actual outburst of Southwest Monsoon is expected in the coming week. Here's a look at the Monsoon performance from 1st to 10th June-

National - The national cumulative average Monsoon rain was deficient by a whopping 43% until the 10th June. Kerala and Karnataka- Monsoon rain over Kerala witnessed to be deficit by 40% while coastal Karnataka was deficit by 80%. Northeast India- Assam and Arunachal Pradesh were deficit by 25%. Nagaland, Manipur, Mizoram and Tripura have hardly received rain accounting for 80% deficit. Sub Himalayan West Bengal- This region has been witnessing good Monsoon showers and is surplus by 60%. In the next 10 days, rain will increase over the country but will fail to cover up the deficiency.By: Skymetweather.com

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U.S. stocks gain as U.S. rules out troops in Iraq; Dow rises 0.25%

Investing.com - Investing.com - U.S. stocks rose on Friday after President Barack Obama ruled out sending troops into Iraq to help quell a rebellion there, though concerns that insurgents will arrive at the outskirts of Baghdad later in a matter of days capped gains.

At the close of U.S. trading, the Dow 30 rose 0.25%, the S&P 500 index rose 0.31%, while the NASDAQ Composite index rose 0.30%.

The Volatility S&P 500 index, which measures the outlook for market volatility, was down 3.03% at 12.18.

Wall Street continued to track a rebellion in Iraq led by a Sunni Islamist group that threatened to take Baghdad after capturing key cities elsewhere in the country.

Investors breathed a sigh of relief, however, after U.S. President Barack Obama said he won't sent troops to Iraq and added oil continues to flow normally out of the country, which boosted stock prices, though concerns insurgents may reach the outskirts of Baghdad before the U.S. can provide logistical support watered down gains as did soft data.

In a preliminary report, the Thomson Reuters/University of Michigan consumer sentiment index fell to 81.2 this month from 81.9 in May, whose figure was revised up from a previously estimated reading of 81.8. Analysts had expected the index to rise to 83.0 in June.

Also on Friday, official data showed that U.S. producer price inflation fell 0.2% in May, confounding expectations for a 0.1% rise, after a 0.6% increase the previous month.

Core producer price inflation, which excludes food, energy and trade, slipped 0.1% last month, compared to expectations for an increase of 0.1%, after a 0.5% rise in April.

In other news, Priceline Group said it would acquire the online restaurant reservation service OpenTable Inc (NASDAQ:OPEN) for $2.6 billion.

Tech shares rallied after chipmaker Intel Corporation (NASDAQ:INTC) hiked its second-quarter revenue outlook.

Leading Dow Jones Industrial Average performers included Intel Corporation (NASDAQ:INTC), up 6.81%, Microsoft Corporation (NASDAQ:MSFT), up 1.59%, and Exxon Mobil Corporation (NYSE:XOM), up 0.93%.

The Dow Jones Industrial Average's worst performers included Wal-Mart Stores Inc (NYSE:WMT), down 0.60%, Home Depot Inc (NYSE:HD), down 0.52%, and UnitedHealth Group Incorporated (NYSE:UNH), down 0.35%.

European indices, meanwhile, ended the day largely lower.

After the close of European trade, the DJ Euro Stoxx 50 rose 0.01%, France's CAC 40 fell 0.24%, while Germany's DAX fell 0.26%. Meanwhile, in the U.K. the FTSE 100 fell 0.95%.

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CFTC - week ending June 10: speculators more bearish on Euro

Investing.com - Investing.com - The Commodity Futures Trading Commission released its weekly Commitments of Traders report for the week ending June 10 on Friday.

Speculative positioning in the CME currency futures:

				Long		Short
	Net	Prior	Change	Gross	Change	Gross	Change
EUR	-57.2k	-33.0k	-24.2k	43.7k	-13.4k	100.9k	10.8k
GBP	35.8k	35.0k	0.9k	85.2k	5.7k	49.4k	4.9k
JPY	-82.2k	-74.2k	-7.9k	11.9k	-0.7k	94.1k	7.3k
CHF	-3.0k	-2.0k	-1.0k	9.6k	-2.3k	12.6k	-1.3k
CAD	-24.1k	-22.7k	-1.4k	30.3k	-2.2k	54.4k	-0.8k
AUD	28.2k	21.5k	6.7k	62.1k	5.3k	33.9k	-1.4k
NZD	16.9k	17.5k	-0.7k	20.4k	-2.0k	3.5k	-1.3k
MXN	90.2k	86.0k	4.2k	106.6k	0.9k	16.4k	-3.3k

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Natural gas soars on bullish U.S. supply report

Natural gas soars on bullish U.S. supply report

Investing.com - Investing.com - Natural gas futures shot up on Thursday after official data revealed that U.S. natural gas supplies rose less than expected last week.

On the New York Mercantile Exchange, natural gas futures for delivery in July traded at $4.756 per million British thermal units during U.S. trading, up 5.49%. The commodity hit a session high of $4.759 and a low of $4.518.

The July contract settled down 0.49% on Wednesday to end at $4.508 per million British thermal units.

Natural gas futures were likely to find support at $4.504 per million British thermal units, Wednesday's low, and resistance at $4.827, the high from May 7.

The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. in the week ended June 6 rose by 107 billion cubic feet, below forecasts for an increase of 110 billion cubic feet.

Total U.S. natural gas storage stood at 1.606 trillion cubic feet. Stocks were 727 billion cubic feet less than last year at this time and 877 billion cubic feet below the five-year average of 2.483 trillion cubic feet for this time of year.

Producers would need to add approximately 2.5 trillion cubic feet to storage by November 1 to meet typical winter demand, analysts said.

Forecasts for warmer weather fueled the rally as well.

Natgasweather.com reported earlier that weather models called for warmer temperatures to settle over the coming days, while the possibility of a tropical weather system developing in the Gulf of Mexico pushed up prices as well.

Tropical weather systems prompt energy companies to evacuate offshore rigs, which can disrupt supply.

Elsewhere on the NYMEX, light sweet crude oil futures for delivery in July were up 1.75% at $106.23 a barrel, while heating oil for July delivery were up 2.54% at $2.9781 per gallon.

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U.S. stocks drop on Iraqi concerns; Dow falls 0.65%

Investing.com - Investing.com - U.S. stocks fell on Thursday after conflict in Iraq threatened to morph into a full-blown civil war that could roil the Middle East and send global oil prices climbing and hamper recovery.

At the close of U.S. trading, the Dow 30 fell 0.65%, the S&P 500 index fell 0.71%, while the NASDAQ Composite index fell 0.79%.

The Volatility S&P 500 index, which measures the outlook for market volatility, was up 8.36% at 12.57.

Iraqi insurgents tied to al-Qaeda reportedly took full control of the northern oil city of Kirkuk on Thursday and advanced closer to the capital, Baghdad.

On Wednesday, militants from the Islamic State in Iraq and Syria, or ISIS, seized the northern cities of Mosul and Tikrit, which bruised stock prices by fueling fears U.S. recovery could suffer, especially if oil prices rise.

The U.S. said that it is working with Iraq's leaders on a coordinated response to regain lost territory.

Earlier Thursday, U.S. President Barack Obama said Iraq would need assistance from the U.S. to push the insurgents back.

Disappointing U.S. economic indicators dampened spirits on Wall Street as well.

The Commerce Department reported earlier that U.S. retail sales rose 0.3% in May, missing expectations for a 0.6% gain. However, retail sales for April were revised up to a 0.5% gain from a previously reported increase of 0.1%.

Core retail sales, which exclude automobile sales, eased up 0.1% in May, disappointing forecasts for a 0.2% increase. Core sales in April were revised up to 0.4% from a previously reported flat reading.

Separately, the Labor Department reported that the number of individuals filing for initial jobless benefits in the week ending June 7 increased by 4,000 to 317,000, confounding expectations for a decline of 3,000.

Leading Dow Jones Industrial Average performers included Chevron Corporation (NYSE:CVX), up 0.77%, Goldman Sachs Group Inc (NYSE:GS), up 0.35%, and The Travelers Companies Inc (NYSE:TRV), up 0.11%.

The Dow Jones Industrial Average's worst performers included Caterpillar Inc (NYSE:CAT), down 1.87%, Walt Disney Company (NYSE:DIS), down 1.80%, and Home Depot Inc (NYSE:HD), down 1.73%.

European indices, meanwhile, ended the day largely lower.

After the close of European trade, the DJ Euro Stoxx 50 fell 0.21%, France's CAC 40 fell 0.02%, while Germany's DAX fell 0.11%. Meanwhile, in the U.K. the FTSE 100 rose 0.06%.

On Friday, the U.S. is to round up the week with data on producer price inflation and preliminary data on consumer sentiment from the University of Michigan.

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