Weekly News Roundup at 10:00 am on 16th June, 2024

Let’s begin – India’s retail inflation based on the Consumer Price Index likely rose to a three-month high of 5% in May, primarily on account of rise in prices of vegetables and pulses, according to the median of a poll of 18 economists conducted by FE. In April 2024, the headline inflation was 4.82%, and in May 2023, it was 4.31%. The National Statistical Office is going to release the CPI data for May on Wednesday. The estimates of economists for May CPI print ranged from as low as 4.5% to as high as 5.2%. If the headline print comes in at 5%, the overall index will rise 0.7% month-on-month, at the highest pace in 10 months.

Up next – The Centre has revealed cost overruns exceeding Rs 5.5 lakh crore in 448 infra projects in April 2024. Notably, the ratio of cost overruns in central government projects surged to a 12-month high of 20.09% in April, up from 18.65 percent in the previous month. Out of the 1,838 projects assessed, 448 reported cost overruns and 792 experienced delays. The original cost of these 1,838 projects, each valued at Rs 150 crore or more, was Rs 27,64,246.50 crore. However, their anticipated completion cost is now projected at Rs 33,19,601.84 crore, marking an increase of Rs 5.6 lakh crore over the original estimates. The report also noted that number of delayed projects decreased to 514 when calculated based on the latest completion schedule.

Moving on – Adani Group, which is setting up two wind power projects in Sri Lanka totaling 484 MW, has offered to provide renewable power at LKR 24.75 per unit, much lower than existing tariffs in the country. This offer is significantly lower than the tariffs from existing renewable and traditional energy sources in the country, which range from 8.75 to 26.99 cents, according to a compilation of power tariffs. The Sri Lankan government has entered into a 20-year power purchase agreement with Adani Green Energy for power from the wind farms in Mannar and Pooneryn. AGEL is the entity through which the Indian conglomerate is setting renewable power projects in Sri Lanka.

In another development – Packaged foods major Nestle India has said that it would pay royalty to its parent Société des Produits Nestlé, at its current rate of 4.5%. The announcement comes after over 57% shareholders last month had rejected the company’s proposal to hike the royalty rate to 5.25% over five years. Proxy advisory firm IiAS had also advised shareholders to vote against the proposal. Nestle said that its decision to continue with the current rate of royalty was done “respecting the decision of the members and feedback from other stakeholders”. Had the proposal to increase royalty gone ahead, then Nestle’s royalty rate would have been amongst the highest in the domestic fast-moving consumer goods industry.

Meanwhile – Fuelled by economic diversification, rising consumer demand, and reverse migration patterns accelerated by the pandemic, the real estate markets of Tier-2 cities are witnessing remarkable growth trends, and these once overlooked urban centres are rapidly closing the gap with their Tier-1 counterparts, according to Housing.com’s ‘The Bharat in India’ report. This surge can be attributed to the burgeoning economic potential of these cities attracting a growing influx of residents. Notably, this trend has gained momentum in the wake of the pandemic and fuelled by the phenomenon of reverse migration. The economic dynamism has had a multiplier effect on the real estate market in Tier-2 cities especially in retail, warehousing and residential segments.

In other news – With ample brands available at both online and offline platforms, consumers tend to get confused with what to buy and what not to. Infact, 76% of consumers in India feel inundated by too much choice while 74% say that they are bombarded by advertising, resulting in 88% of the masses abandoning purchases in the last three months of 2023, reveals Accenture’s latest report. The report is based on a survey of 19,000 consumers across 12 nations. It highlighted that 67% people see no improvement or even see an increase in the time and effort required to make a purchase decision. This consists of the 40% who think it has got harder, 28% who see no change and 33% thinking it takes less time and effort.

Lastly – Indian universities and higher education institutions will now be permitted to offer admissions twice a year, similar to the practice in foreign universities, following approval from the University Grants Commission, university body chief Jagadesh Kumar announced. The two admission cycles will be scheduled for July-August and January-February, beginning with the 2024-25 academic session. According to Kumar, biannual university admissions will help students maintain motivation since they do not have to wait one full year to be admitted if they miss admission in the current cycle. With biannual admissions in place, industries can also do their campus recruitment twice a year, improving employment opportunities for the graduates.