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Tuesday, August 18

Posted in Business

 Jindal loses Nepal bid to another Indian firm
KATHMANDU, Aug 18 (IANS): Jindal Steel and Power Ltd, the third largest Indian steel manufacturer whose owners are ranked among the 20 richest Indians by Forbes magazine, has lost its bitter battle for control of a much-sought-after hydro power project in Nepal with the republic's apex court upholding the contract to another Indian contender.
Jindal went to court last year after the Nepal government awarded the 402 MW Arun III project to Satluj Jal Vidyut Nigam, the public sector undertaking owned by the government of India as well as the state government of Himachal Pradesh.

After the sea change in Nepal's political scenario in 2006, when a new coalition government replaced the regime of King Gyanendra, the hydropower sector was opened to international players and nine companies, mostly Indian, who had bid for Arun III.

Jindal's bid was among the most attractive with its offer to provide 21 percent free energy to power-starved Nepal.

However, the then Girija Prasad Koirala government of Nepal amended the criteria, which had earlier sought only private players, allowing bids from the public sector as well.

Satluj was also allowed to amend its free energy offer to 21 percent from the initial 4.5 percent.

Jindal sought court remedy, alleging that the awarding of the contract to its Indian competitor was illegal.

However, the apex court quashed the petition Sunday, upholding the government's decision.

It also said if the slighted Indian company felt there was corruption involved, it should lodge a complaint with Nepal's Commission for Investigation of Abuse of Authority.
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PNB aims to issue 2 lakh global credit cards by March 2010
CHANDIGARH, Aug 18 (PTI): Intending to widen its credit card base across value as well as high end customers, public sector lender Punjab National Bank (PNB) is now aiming to issue 2 lakh global credit cards by March 2010.

"We are targeting to issue two lakh global credit cards to our customers by the end of the current fiscal," PNB Chief General Manager (Credit Card Venture) Ranjan Dhawan said Monday.

The bank would also shortly launch its new cards- Corporate and Platinum credit cards. "Corporate Cards will be meant for senior executives of companies who often travel for business purposes. In this category, there will be two cards such as Individual liability and corporate liability," he informed.

Another second Platinum card will come with enhanced benefits for high end customers (income having between Rs 7 to 10 lakh per annum). "This card will meet the requirements of customers like premium gold membership, lounge expenses etc," he said.

"Trials for these cards are already on and we hope to launch them within next two months," he said.

Having launched its credit card in February this year in association with VISA, PNB has already created a card base of 28,000. This card is accepted at over 29 million merchant establishments and one million ATMs worldwide which use VISA as a payment gateway.

Having decided to foray into Card Acquiring Business, Dhawan said that the bank, under this initiative, would provide Point of Sales (PoS) terminals to merchandise establishments which are associated with it.

"We have sought Expression of Interest for launching this service and we hope to introduce the same within the next 8-9 months," he said.
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 Aditya Birla group moves High Court against tax notice
MUMBAI, Aug 18 (PTI): The Aditya Birla group, which controls cellphone major Idea Cellular, has moved the Bombay High Court against the income-tax department's notice regarding capital gains tax on a share purchase deal.

The Division Bench of Justices F I Rebello and D G Karnik on Monday reserved orders as to whether the Birla group's petition is admissible or not. The order will be passed ton Tuesday.

In the present case, the issue is whether the Birla group is liable to pay capital gains tax on the share-purchase transaction worth USD 150 million with AT&T Mauritius (subsidiary of AT&T).

The Mauritius-based company sold its stake in Idea to the Birla group in 2005.

According to the Birlas, since the double-taxation avoidance treaty exists between Mauritius and India, AT&T was not liable to pay tax in India, and so the Indian entity did not deduct tax.

The company's lawyer Soli Dastoor said the Birla group was permitted to remit the whole purchase amount to AT&T by the Income-Tax authorities in September 2005.
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 RBI offers 600 bln rupees at special repo
MUMBAI, Aug 18 (Agencies): The Reserve Bank of India will conduct a special repo auction for 600 billion rupees on Monday and the reversal of the auction will be on Aug. 31, it said in a statement.
The special repo facility on a daily basis was introduced on Oct. 14, 2008, offering 200 billion rupees to meet liquidity needs of mutual funds.
The central bank later increased the facility to 600 billion rupees to include liquidity needs of non-banking financial companies and housing finance companies.
At its policy review on April 21, the central bank said the auction will be conducted on a weekly basis every Monday till March 2010.
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with logo of airtel
Airtel launches global wholesale portfolio
NEW DELHI, Aug 18 (IANS): Bharti Airtel on Monday launched its global wholesale service portfolio, which will enable telecom companies across 50 countries to access its services.
The company has invested $500 million to expand its connectivity by building cable capacity, network infrastructure and international points of presences, an official statement said.

The portfolio includes solutions for voice and data connectivity, collaboration services, co-location, carrier outsourcing and content distribution through its next-generation high speed submarine network.

"From being a regional partner for foreign carriers, Bharti is now uniquely poised to serve global carriers to and from any part of the globe," said David Nishball, president (enterprise services), Bharti Airtel.
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 Torrent starts output from final phase of Gujarat power unit
MUMBAI, Aug 18 (IANS) The $1 billion power and healthcare major Torrent group has started commercial production of electricity under the final phase of the Rs.3,600 crore Sugen power plant in Gujarat that will cater to its customers in Ahmedabad, Gandhinagar and Surat.
Like the first two phases, the third stage of the unit is also generating 382.5 MW, taking the total capacity to 1,147.5 MW, the company said in a regulatory filing with the Bombay Stock Exchange.

The project is located close to the Tapi river on National Highway No.8, with close proximity to the gas supply infrastructure, comprising LNG terminals and main gas trunk lines.

Promoted by the Mehtas, Torrent Power distributes more than 10 billion units of power to 1.9 million customers in Ahmedabad, Gandhinagar and Surat -- the main industrial and commercial hubs of the state -- covering 408 Sq Km.
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Sensex ends 637 points down
MUMBAI, Aug 18 (IANS): Thanks to weak global cues and continued profit selling, a key index of the Indian equities markets Monday shed 637 points to close below the 15,000-mark.
The 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE), which opened lower at 15,284.23 points, ended at 14,774.01 points (provisional), down 637.62 points or 4.14 percent.

The Nifty of the National Stock Exchange (NSE) also closed in the red, losing 4.2 percent from its previous closing figure to end at 4,387.8 points.

Broader market indices closed in the negative terrain, with the BSE midcap index ending 3.77 percent down, while the the BSE smallcap index closed 3.03 percent.

Other Asian markets shut shop in the red as well, while European markets were ruling negative.
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 Japanese economy shows growth after five quarters
TOKYO, Aug 18 (DPA): Japan's economy grew 3.7 percent in the second quarter, the first positive increase in five quarters, according to preliminary estimates released Monday by the Japanese government.
The figure represented a huge swing upward from the first quarter, when the gross domestic product (GDP) fell by an annualized 11.7 percent, and the quarter before that, which saw a dive of 13.1 percent.

Private consumption as well as the state fiscal injections contributed to the positive growth. But private investments continued to remain weak.
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 China's foreign direct investment falls in July
BEIJING, Aug 18 (Agencies): China received $5.36 billion in foreign direct investment (FDI) in July, down 35.7 percent year on year, said Ministry of Commerce spokesman Yao Jian on Monday.
China's total export-import volume between January and July decreased by 22.7 percent year on year to $1,146.71 billion. Imports and exports volume for July amounted to $200 billion, illustrating the falling off in foreign trade, Yao said.

The amount of direct Taiwanese investment in the Chinese mainland totalled $1 billion in the first half of the year, down 14.94 percent year on year, and the trade volume between the two shrank 35.1 percent to $52.53 billion in the same period, he said.
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NTPC shareholders move court on Reliance gas
NEW DELHI, Aug 18 (IANS) Some shareholders of the state-run power utility NTPC moved a petition on Monday seeking directions to its management from the Delhi High Court to ensure all legal steps are taken to get natural gas supplies from Reliance Industries at the contracted price.
The petition filed on their behalf by advocate R.N. Ramalingam also asks the court to order a probe into NTPC with regard to its contract with Mukesh Ambani-led Reliance Industries for the supply of 12 million units of gas at $2.34 per unit from the Krishna-Godavari basin.

"NTPC and its officials are acting against the public interest and are acting in a manner that a huge wrongful profit will be made to Reliance Industries to the tune of Rs.25,000 crore at the cost of public exchequer," the petition said.

The litigation was filed here while NTPC was advised by the government to move the Supreme Court to secure gas from Reliance Industries. The Bombay High Court is also hearing the matter.

Two top law officers of the government, Attorney General Goolam E. Vahanvati and Solicitor General Gopal Subramaniam, have already advised the company to move the apex court immediately to secure its interest in the gas row.

"NTPC should take all possible steps to protect its interest as advised by the solicitor general," said Vahanvati over the weekend, endorsing the solicitor general's legal opinion to the government.

Law ministry officials said the unanimous opinion of the two law officers has been forwarded to NTPC, which is a listed company that has 10.5 percent of its shares held by public and financial institutions.

"The fact that NTPC had to file a suit is a telling comment on the facts of the present case," said Subramaniam.

"I regret to say that if international competitive bidding processes are intended to be treated with such disdain from responsible bidder (Reliance Industries), the world of business founded on trust and faith will break down."

NTPC - as also Anil Ambani's Reliance Natural Resources - are fighting a legal battle to get gas at $2.34 per unit from Reliance Industries, which has refused to do so, saying the government's stand on price would frustrate the deal.
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Thailand hopes trade with India will touch $10 bn by 2010
KOLKATA, Aug 18 (IANS): Bilateral trade between India and Thailand is expected to grow to $10 billion by 2010 from $6 billion last year, an official from Thailand said here Monday.
"India has increasingly become an important economic partner for Thailand. Last year, the average value of our bilateral trade has been around $6 billion and it has constantly expanded at the rate of about 28.97 percent in previous years," said Kiat Sittheeamorn, president of the Thailand Trade Representative (TTR).

TTR is a government body, set up to promote trade between Thailand and other countries.

"We are aiming that, in 2010, the total amount of bilateral trade will reach $10 billion," Kiat said, while speaking at an interactive session organised by the Confederation of Indian Industry.

Investment from Thailand to India during 2000-2009 was to the tune of $831.2 million whereas Indian investment to Thailand in 2008 alone stood at $282.11 million.

The industrial sectors in which Thai investments are prominent in India are telecommunication, hotel, tourism, food processing, trading and chemicals.

Earlier in the day, Kiat met the leader of the opposition in West Bengal Partho Chattopadhyay of the Trinamool Congress.

Regarding the meeting, he said: "We have conveyed that trade and investment regime in India should be made more competitive so that everyone is interested to come over here."

Asked about his outlook of the growth in the tourism sector in both countries, Kiat said: "This area will certainly grow a lot. At least half a million Indians visit Thailand every year, compared to 60,000 Thai people visiting India."

He added that two more high-level Thai visits are scheduled for this year - Prime Minister Abhisit Vejjajiva in November and Deputy Prime Minister Korbsak Sapawasu in October.
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Madhya Pradesh bans use of air conditioners in government offices

Posted in Business

 Madhya Pradesh bans use of air conditioners in government offices
BHOPAL, Aug 13 (Agencies): Hit by a severe power crisis, the Madhya Pradesh government has decided to stop using air conditioners in its offices across the state from Thursday.

The decision was taken at a meeting of senior government officials and top executives of power distribution companies Wednesday.

Chief Minister Shivraj Singh Chouhan, who chaired the meeting, said the restrictions would be in place till the power situation in the state improved, a power distribution company official said.

'Now, the government offices would not be allowed to use air conditioners. These machines consume huge quantities of power which worsens the power situation in the state,' the official said on condition of anonymity.

'However, all government hospitals would be exempted from these restrictions,' he added.

The chief minister has also asked the chief executive directors of the power companies to ban the use of neon lights on advertisement hoardings.

The state is struggling with one of its worst power crises as the electricity shortage has jumped to over 1,500 MW during peak hours.

Many parts of the state are witnessing power cuts of up to 14 hours a day.

District and divisional headquarters suffer from five and three-hour daily power cuts respectively.

Chouhan also asked the companies to ensure better power distribution. Cooperation between companies and people is a must in containing the wastage of electricity, he said.

The chief minister further appealed to the people to restrict the use of electricity given the present condition.

State Energy Minister Anup Mishra, Chief Secretary Rakesh Sahni and Energy Secretary Sanjay Bandopadhyay were also present at the meeting.
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 India's inflation falls to minus 1.74 percent
DELHI, Aug 13 (Agencies): India's annual rate of inflation fell marginally to minus 1.74 percent for the week ending August 1 from minus 1.58 percent the week before, according to official data released Thursday.

The rate turned negative for the week ended June 6 for the first time since the new wholesale price index (WPI) series started in 1995.

The inflation rate had last turned negative in 1977. Negative inflation implies that the average wholesale price level was lower during a given week, than it was in the corresponding week a year ago. It does not necessarily reflect retail prices.

Both the price indices for primary articles and manufactured products rose 0.1 percent.

While the index for primary articles rose 0.1 percent to 262.5 (provisional) from 262.2 (provisional) the week before, the index for manufactured products rose 0.1 percent to 205.9 (provisional) from 205.6 (provisional) for the previous week.

The price index for fuel and power also saw a marginal rise to 338.3 (provisional) from 338.2 (provisional) the week before.

The final data for the week ended June 6 showed that the revised annual inflation rate actually stood at minus 1.01 percent.
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 GoM to study impact of jet fuel prices on aviation industry
NEW DELHI, Aug 13 (PTI): A Group of Ministers (GoM) would be set up soon to study the impact of high jet fuel prices on the aviation industry and recommend measures to bring down its burden on the operational costs of the airlines.

This was decided today at a meeting of the Union Cabinet, chaired by Prime Minister Manmohan Singh, where Civil Aviation Minister Praful Patel made a presentation on the health of the aviation sector.

After the meeting, Patel said the GoM, to be set up soon by the Prime Minister, would focus on the "very high nature" of sales tax being imposed on aviation turbine fuel (ATF) by various state governments as also its base price, which was "much higher" than most countries.

ATF accounts for over 40 per cent of the total operational cost of an airline in India, compared with 20-25 per cent globally.

The Minister said he briefed the Cabinet on the need for additional capital infusion in Air India, which currently has an equity base of only Rs 145 crore and has ordered planes worth over Rs 50,000 crore.

He also informed the meeting about the decision of Airports Authority of India to raise funds by issuing infrastructure bonds worth Rs 5,000 crore. AAI is modernising and upgrading a large number of airports throughout India, including those in Kolkata and Chennai. .
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India, ASEAN sign deal on free trade in goods
BANGKOK, Aug 13 (Agencies) - India and the 10-country Southeast Asian bloc ASEAN signed a long-delayed free trade agreement on Thursday after more than six years of negotiations.

Thai and Indian officials said the Free Trade Agreement (FTA) would eliminate tariffs on products including electronics, chemicals, capital goods and textiles that account for more than 80 percent of total trade in goods between the two sides.

Tariffs on those products would be reduced to zero between 2013 and 2016, according to a joint statement issued just before the signing ceremony.

ASEAN groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.
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 ‘Compromised' template reason behind fake notes: CBI (wit pic)
NEW DELHI, Aug 13 (PTI): The secret template India uses to print currency notes has been "compromised" and that is possibly why fake but real-looking Indian currency notes are being pumped in, says the Central Bureau of Investigation, to subvert the country's economy.

The CBI, the nodal agency for checking fake notes, has now formed a special team comprising its sleuths and officials from the Directorate of Revenue Intelligence, the Reserve Bank of India and the Central Forensic Science Laboratory to find out how and at what level the design got "compromised".

"Our investigations have revealed that the 2005 secret security template which was introduced as part of the new design adopted then has been compromised," CBI Director Ashwini Kumar said.

Asked, if the country was still using the security template, he said, "yes".

By using the word "compromised" the CBI means that the counterfeiters have deep knowledge about the kind of special ink, paper and other ingredients that go into the making of notes.

Giving details of the investigation team, CBI spokesperson Harsh Bhal said "a special team has been formed which consist of officers from CBI, DRI, RBI and CFSL."

"The team will investigate how and at what level the security template has been compromised," he said.
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 Gold, silver rise on festive demand amid firm global cues
NEW DELHI, Aug 13 (PTI) : Gold and silver prices spurted in the bullion market on heavy buying by jewellery and coin fabricators on the eve of holy festival of 'Janmashtmi' amid firming global trend.

Gold rose further by Rs 50 to Rs 15,100 per ten gram and silver surged by Rs 300 to Rs 23,400 per kg.

Buying activity picked on emergence of last-minute buying of jewellery and coins to decorate temples on the occasion of 'Janmashtmi,' traders said.

They said there was some buying among retailers for the coming marriage season.

Trading sentiment also turned bullish as gold gained in London as the dollar weakened, increasing the metals appeal as an alternative investment. In London, gold climbed 5.50 dollar to 952.60 dollar an ounce.

Standard gold and ornaments remained in demand and advanced further by Rs 50 each to Rs 15,100 and Rs 14,950 per ten gram respectively. Both had gained Rs 50 in previous day's trading.

Silver ready rose by Rs 300 at Rs 23,400 per kg and weekly-based delivery by Rs 560 at Rs 23,630 per kg. Silver coins also spurted by Rs 200 at Rs 29,800 for buying and Rs 29,900 for selling of 100 pieces.
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PM to address CMs regarding drought situation on Monday
NEW DELHI, Aug 13 (Agencies): Concerned over drought conditions in several parts of the country, Prime Minister Manmohan Singh will address the Chief Ministers of all states in New Delhi on Monday on measures to salvage the situation.

The Prime Minister would make use of the presence of Chief Ministers, who are gathering here for a meeting on internal security, to discuss the worsening agriculture scenario following inadequate rainfall and shrinkage in area under cultivation, sources said.

According to recent data, as many as 161 districts out of a total of about 600 have been declared drought affected.

Singh in his address to the Chief Secretaries of various states last week had expressed concern over rising prices of essential commodities like pulses, sugar and vegetables and had asked them to activate the public distribution system (PDS), "which is an important safety net especially for the poor and helps cushion them against price rise."
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Greater incentives for savings in new taxes code
NEW DELHI, Aug 13 (PTI): Saving for the future in insurance, provident fund and pension schemes may get more attractive with a higher relief at Rs three lakh against the present provision of Rs one lakh if the proposed Direct Taxes Code becomes a law.

The draft Direct Taxes Code unveiled by Finance Minister Pranab Mukherjee proposes raising the tax exemption limit on savings to Rs three lakh.

"The limit for deduction for savings has been substantially increased to Rs three lakh," an official statement said on the new tax code, which has been put up for public comments.

However, the code proposes imposing a tax on the money withdrawn from savings schemes like PPF, EPF and GPF. At present, tax is not imposed on withdrawal from these schemes.

The proposal is progressive and a move towards doing away with the existing taxation structure for savings, said tax expert Aseem Chawla, who is a partner with law firm Amarchand Mangaldas .

"The tax code wishes to implement the Exempt, Exempt Tax (EET) mode of taxation which is very good but it has to do it in a gradual manner," he said.
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 Pratibha Industries bags contract worth Rs 523.4 cr
MUMBAI Aug 13: Infrastructure development firm Pratibha Industries on Thursday said it has bagged a contract worth Rs 523.40 crore from National Building Construction Corporation Ltd for the construction of a medical college at Patna.

The company has bagged the contract for the construction of ESIC Medical College and the work is expected to be completed in 2 years, Pratibha Industries said in a filing to the Bombay Stock Exchange (BSE).

The scope of the work includes construction of a hospital building, medical college, hostels and a residential complex, the filing added.
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Govt should raise more resources to tackle drought: Rangarajan

Posted in Business

Govt should raise more resources to tackle drought: Rangarajan
NEW DELHI, Aug 12 (PTI): Warning that farm sector distress can have serious consequences on the economy, PMEAC chairman C Rangarajan on Wednesday asked the government to raise additional resources to provide relief to drought-hit people and increase import of essential commodities to check price rise.

"Distress in agriculture (due to drought) will have other serious dimensions. The government may have to find additional resources to meet the requirements of the affected people," he said after taking over as the head of the Prime Minister's Economic Advisory Council (PMEAC) for the second time.

As regards the impact of drought on economy, he said, the growth rate could slip to 6-6.5 per cent from 6.7 per cent in the previous fiscal.

"The Indian economy has been doing well in the past several years but the growth rate came down to 6.7 per cent last year because of the impact of international financial crisis. This year the economy will grow between 6 and 6.5 per cent. The drought will have dampening impact on the overall growth rate," he said.

"As a result of the drought there is a tendency of the prices to rise. The stock of food grains available with the government is large, but wherever there is a scarcity and where imports are possible we should do it. If the production of pulses fall there should be a greater effort to import pulses," he said.

Stressing that the government should ensure that imported pulses reach the targeted people, Rangarajan said, there is a need to strengthen the public distribution system.

"We must also ensure that even people above the poverty line get adequate quantity of rice and wheat at prices which are reasonable," he added.

Asked what would be his advice to the Prime Minister as the Chairman of the Council for the growth of economy, he said infrastructure sector needs to be strengthened for the economy to pick up.

"We really need to ensure that the infrastructure sector is strengthened and within the infrastructure sector the most important element is power both over the medium and short term. The focus of the government must be on ensuring that adequate capacities are created," he said.

"We need to monitor in a very intensive way the additional capacities and generation of power. There was a large shortfall in the addition to capacities in the 10th Plan. We should not let that story repeat," he added.

Prime Minister Manmohan Singh on Tuesday reconstituted his Economic Advisory Council (PMEAC) bringing back Rangarajan as its head and inducting two new members.

Rangarajan, 77, has replaced Suresh Tendulkar, after quitting from the Rajya Sabha.

The appointment of Rangarajan comes at a time when the government is faced with challenges, at the economic front to steer the economy back to the growth path and on the other hand tackle a looming drought.

Rangarajan had his first stint as Chairman from 2005 to 2008 when he was nominated to Rajya Sabha.

The two new members of the PMEAC are Suman Bery, Director General of the National Council of Applied Economic Research (NCAER) and V S Yvas, President, Asian Society of Agricultural Economists.

The other economists, who have been retained as PMEAC members are Saumitra Chaudhuri, member, Planning Commission and Govinda Rao, director, National Institute of Public Finance and Policy (NIPFP).

A former Reserve Bank Governor, Rangarajan is a close confidant of Singh and had varied experience having served as RBI Governor, Planning Commission member, Chairman of the 12th Finance Commission and as Governor of Andhra Pradesh.

Before his elevation as Reserve Bank Governor in 1992, Rangarajan served the central bank as Deputy Governor for over a decade.

He also functioned as the Governor of Andhra Pradesh before taking over as chairman of the 12th Finance Commission in 2003. He was also member of the Planning Commission from 1991 to 1996.
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 Industrial growth on upswing, up 7.8% in June
NEW DELHI, Aug 12 (PTI): At a time when the weak monsoon is threatening to reduce farm output, Indian industry started showing signs of revival as it clocked 7.8 per cent growth in June, reversing the extremely bleak trends that had set in since the collapse of Lehman Brothers in September 2008.

Effects of fiscal and monetary stimulus were visible as manufacturing, the worst-affected, grew by a whopping 7.3 per cent in June over 6.1 per cent a year ago.

With manufacturing constituting about 80 per cent in the index of industrial production (IIP), industrial growth at around eight per cent in June was way above the 5.4 per cent a year ago.

Mining grew by a substantial 15.4 per cent and power was up eight per cent in June.

For the first time after Lehman Brothers collapsed, segments like capital goods, consumer durables, and consumer non-durables did not show contraction in output.

Industrial growth stood at 3.7 per cent in the first quarter of this fiscal against 5.3 per cent a year ago. Given the fact that industry started contracting since September, its growth, if this trend persists, will be higher because of a low base.

With the weakening monsoon casting a shadow on farm growth, this kind of industrial growth may offset the adverse impact partly.

In the same month last fiscal, the industry grew by 5.4 per cent. However, the growth was 5.3 per cent in the first quarter a year ago.

Commenting on the recovery of the industrial sector, Planning Commission Deputy Chairman Montek Singh Ahluwalia said, "I always expect the positive trend (in industrial growth) to continue. However, weak monsoon could have some negative impact on the overall GDP."

According to the IIP data, 12 out of 17 industrial segments during June recorded positive growth compared to the corresponding month of the previous year.
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 Axis Bank to sell shares to founders
MUMBAI, Aug 12 (Agencies): Axis Bank plans to issue 10.83 million shares, worth about $190 million at current prices, to its founders as part of a larger share sale plan to beef up its capital base.

"The bank has continued to grow strongly over the last few years and foresees a demand for credit in various sectors including the retail banking segment," the bank said in a note to investors.

"Success in en-cashing this business opportunity rests on the ability to raise funds by way of equity," it said.

The lender has sought shareholder approval to sell a total of 71.4 million shares through private placement to institutions or global depositary receipts. At current prices the share sale would raise up to $1.25 billion.

An economic revival has made companies to revisit expansion plans, fueling demand for loans and prompting banks to raise capital.

Axis Bank said shares would be issued to founders, state-owned Life Insurance Corp, General Insurance Corp and four general insurance firms to allow them to maintain their 15.16 percent holding.

Another founder and the largest shareholder, government-controlled Specified Undertaking of UTI, will not participate in the offering and its stake will fall to 22.54 percent from 27.02 percent, Axis Bank said in the note.

Axis Bank, which the market values at $6.5 billion, was trading down 2.2 percent at 847.50 rupees by 0800 GMT in a weak Mumbai market.

The shares have risen 68 percent so far this year compared to a 53 percent rise for the benchmark.
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 Rupee at two-week low falls by 20 paise in early trade
MUMBAI, Aug 12 (PTI): The Indian rupee on Thursday depreciated by 20 paise to trade at almost two-week low of 48.16 against the dollar for the second straight session in early trade on importers' demand for the US currency, which was also strong against other Asian currencies.

Expectations of capital outflows by foreign funds as stock markets may open in negative zone in line with other weak Asian markets, which were down up to 2.4 per cent in morning trade today, also put pressure on the Indian unit.

At the Inter-bank Foreign Exchange (forex) market, the domestic currency was quoted 20 paise lower at 48.16 a dollar, lowest since July 31. The rupee had lost 15.50 paise to close at 47.96/97 against the US currency in yesterday's trade.

Forex dealers said apart from demand from refiners and importers, firming US dollar against some other Asian currencies also put pressure on the Indian rupee.
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 U.K. Unemployment Climbs to Highest Level in 14 Years
BLOOMBERG, Aug 12 (Agencies): U.K. unemployment rose to the highest level in 14 years as companies continue to cut jobs even as the worst recession in at least a generation begins to ease.

The number of people seeking work in the three months through June rose 220,000 to 2.44 million, the most since 1995, the Office for National Statistics said in London today. A separate measure showing claims for jobless benefit climbed by 24,900 in July to 1.58 million. The median forecast of 24 economists in a Bloomberg News survey was for a 28,000 increase.

Mounting job cuts threaten to hinder Prime Minister Gordon Brown’s re-election campaign for a vote he must hold by June 2010. The Bank of England, which said on Aug. 6 the recession had been worse than anticipated, expects unemployment to keep climbing long after the slump has ended. Governor Mervyn King will today explain last week’s decision by the bank to expand its bond-buying program.

“I would be surprised if the Bank of England doesn’t have a forecast for unemployment peaking at around 10 percent,” said David Tinsley, an economist at National Australia Bank in London and a former central bank official. “There is still a lot of labor shedding to be done and earning growth is slowing in its tracks.”

Overall unemployment, as measured by International Labour Organization standards, rose to 7.8 percent in June, the most since 1996. That compares with 9.4 percent in the U.S. in July, 9.4 percent in the euro region in June and 5.4 percent in Japan.

The pound was little changed at $1.6455 as of 10:26 a.m. in London.

The employment rate fell to 72.7 percent in the quarter through June from 73.6 percent in the previous period, matching the biggest quarterly drop since 1971. The weaker job market is also keeping a lid on pay and average earnings excluding bonuses grew the least since at least 2001.

Claimant unemployment has risen 17 consecutive months and stood at 4.9 percent in July, the highest level since 1997. In June, the number of claims rose 21,500 instead of the 23,800 initially reported.

Some economists say the recent slowdown in the pace of jobless claims flatters the state of the labor market, attributing the disparity with the survey-based jobless measure to restrictions on eligibility for benefits.

With unemployment among 16 to 24-year-olds heading toward 1 million, the government has pledged billions of pounds to keep people in jobs or find new ones.

Business Secretary Peter Mandelson said the Treasury estimates that there would have been “far in excess of 500,000 more jobs lost in the recession had it not been for the government and the Bank of England’s intervention.”

Royal Bank of Scotland Group Plc, Britain’s biggest government-owned lender, said last week that it has cut 16,000 jobs since October. Chief Executive Officer Stephen Hester said “impairments” to the business from the recession and rising unemployment will probably persist for three years.

The Bank of England last week added 50 billion pounds ($82 billion) to its asset-purchase plan, taking it beyond the previous limit granted by the Treasury. The bank has now pledged to pump as much as 175 billion pounds into the economy, equivalent to 12 percent of gross domestic product.

The U.K. economy has shrunk 5.7 percent since the recession began in the second quarter of 2008, rivaling the 6 percent loss of output experienced in the early 1980s. Economists say Britain is heading for the worst economic slump since World War II.

Recent reports show signs of a rebound. U.K. services expanded the most in 1 1/2 years, consumer confidence rose and home prices jumped 1.1 percent in July.

The prospect of further job losses is keeping wages down. Excluding bonuses, average earnings grew 2.5 percent in the three months through June from a year earlier, the least since records began in 2001. Total earnings growth accelerated to 2.5 percent from 2.6 percent, the statistics office said.
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Agri-products perish before reaching consumers, admits government
NEW DELHI, Aug 12 (Agencies): Even as the prices of fruits and vegetables soar daily, the central government has admitted large volumes of agricultural produce perish before reaching consumers because of poor preservation facilities.

A study conducted by an expert committee constituted by the agriculture ministry says the post-harvest losses of horticulture produce in the country are almost 25 to 30 percent of the total production.

'Losses of horticulture produce is due to the lack of adequate post-harvest infrastructure facilities,' Minister of State for Agriculture K.V. Thomas admitted in the Rajya Sabha recently.

'With a view to minimise wastage, the government is implementing three schemes in the country,' the minister had said.

The schemes have been drawn up by three agencies - the National Horticulture Board (NHB) for development of commercial horticulture through production and harvest management; the Technology Mission for Integrated Development of Horticulture in the North-Eastern states, Sikkim, Jammu and Kashmir, Himachal Pradesh and Uttarkhand (TMNE), and the National Horticulture Mission (NHM) for the remaining states.

'Under these schemes, financial assistance is provided for setting up of cold storages, collection centres, package houses, refrigerated vans and mobile pressing units,' Thomas had said.

The alarming revelation comes in the wake of absence of rains that has hit the production of vegetables and fruits across the country.

The national capital, for example, depends on neighbouring states like Rajasthan, Haryana and Punjab for supplies of vegetables and fruits. But the crops have been hit by the lack of rains, leading to reduced inflow of vegetables and fruits and subsequently, prices touching new heights.

Prices of tomato is Rs.30 a kilogram in the government-controlled market in Delhi, while that of potato is Rs.19, and ladies finger Rs.30. Prices of apple and mango have soared up to Rs.120 and Rs.90 a kilogram respectively.

The government had said in parliament last week that the rise in food prices was primarily due to higher remuneration to farmers, a fall in production of some crops and a seasonal rise in demand.

The opposition and the supporting parties of the United Progressive Alliance (UPA) government had disrupted proceedings in parliament a number of times over the price hike issue.

Agriculture Minister Sharad Pawar, while replying to a detailed discussion on price rise in the Lok Sabha, said the government would hold a chief ministers' meeting Aug 17 to discuss the rising prices of essential commodities.
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Industrial output to remain strong – HSBC
MUMBAI, Aug 12 (Agencies): India’s industrial output will continue to be strong, HSBC said in a note on Wednesday.

"Although the June production number could well prove something of an aberration, bearing in mind just how strong it was, the trend in industrial output is clear and it's certainly not down," Robert Prior-Wandesforde, economist at the bank, wrote.

India's industrial output rose to 7.8 percent in June from a year earlier, data showed on Wednesday, beating forecasts by a wide margin, as higher salaries of government employees and stimulus spending boosted consumer demand.

While the poor monsoon is creating justifiable concerns about agricultural sector output, today's release suggests there is plenty of momentum in the ex-agricultural sector, the note said.

HSBC expects positive effects to come from India's fiscal and monetary policy actions as well as the stepping up of oil and gas output.

It therefore retained its growth forecast of 6.2 percent for 2009/10 and 8 percent for 2010/11.
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 Action against airlines erring in H1N1 screening
NEW DELHI, Aug 12 (Agencies) India's aviation sector regulator has warned all airlines operating on international routes of 'appropriate action' if they failed to comply with instructions regarding distribution of health screening cards to passengers on board.

'It has come to the notice of the DGCA (Directorate General of Civil Aviation) that some airlines are still not distributing the requisite health screening cards to the passengers on board, causing public health hazard,' a government statement said Wednesday.

'This non-compliance with the laid down requirements has been viewed very seriously,' the statement by the civil aviation ministry added.

'Instructions given to the airlines in this regard should be followed in letter and spirit, failing which appropriate action would be taken against them,' it said.
The DGCA in April had directed all airlines operating international air services to disburse copies of the health screening card - a pamphlet informing passengers on the process of screening for individuals affected with the H1N1 virus.

The regulator has also asked for a compliance report from airlines immediately.
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 Gold prices rise on current festival demand
NEW DELHI, Aug 12 (PTI) Gold prices today rose by Rs 50 to Rs 15,050 per ten gram in the bullion market here on fresh buying by stockists and jewellery makers to meet the current season festival demand.

Marketmen said fresh buying by stockists and jewellery fabricators in view of festival season mainly led to rise in gold prices.

They said global trend which normally sets the price band in domestic markets here failed to impact the prices.

In London, gold lost 5.85 dollar to 940.25 dollar an ounce, the lowest since July 31.

Standard gold and ornaments rose by Rs 50 each to Rs 15,050 and Rs 14,900 per ten gram respectively while sovereign held steady at Rs 12,500 per piece of eight gram.

Silver ready ruled flat at Rs 23,100 per kg but weekly- based delivery declined by Rs 85 to Rs 23,070 on lack of support from speculators. Its coins continued to asked around previous levels of Rs 29,600 for buying and Rs 29,700 for selling of 100 pieces.
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 Oil prices hit reverse gear, duck under USD 69
LONDON, Aug 12: (AFP) Oil prices dived under USD 69 today as rising supplies, dollar strength and weak equities helped reverse an earlier rally that was sparked by record crude imports in key energy consumer China.

New York's main contract, light sweet crude for September, tumbled as low as USD 68.71 per barrel. It later stood at 69.23, down USD 1.37 from yesterday's closing level.

London Brent North Sea crude for delivery in September fell USD 1.07 to USD 72.43 a barrel in late afternoon trade.

"Supply (of oil) is abundant relative to short-term demand," says Peter Donovan, vice president of Vantage Trading, cited by Dow Jones Newswires.

European stock markets meanwhile fell sharply today as investors awaited the outcome of a US Federal Reserve meeting, with London losing 1.08 per cent and Frankfurt plunging 2.44 per cent.

Wall Street also skidded lower today as investors awaited the Fed's latest decision on monetary policy and its guidance on the outlook for recovery from the sharp US recession.

In early morning oil trading here, London Brent had surged as high as USD 74.20 per barrel.

"Prices found support this morning on some bullish preliminary Chinese trade data, which show crude imports hit a record high of 4.635 million barrels per day (mbpd)," said Barclays Capital analysts in a note to clients.
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Tata secures private loan for Jaguar Land Rover

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 Tata secures private loan for Jaguar Land Rover
LONDON, Aug 11 (Agencies): Tata Motors has secured a 175 million pound ($289 million) private sector loan for its luxury unit Jaguar Land Rover and no longer needs financial support from Britain, a UK government spokesman said on Tuesday.

The Department of Business, Enterprise and Regulatory Reform (BERR) has been holding talks with India's Tata and Jaguar Land Rover on guaranteeing both short and long-term financing.

The media quoted industry experts in May as saying the talks were stalled because the carmaker would not accept the tough conditions imposed by the Britain in return for guaranteeing a loan, including the right of the government to veto management decisions.

The talks centered on a rescue package that involved a 340 million pound approved loan from the European Investment Bank (EIB), to be used for the development of environmental technologies, and 450 million pounds from British banks and underwritten by the government.

BERR said on Tuesday that Tata had secured private sector funding for the company's short-term financial needs.

"This additional funding will allow JLR to invest in future models and successfully launch the new XJ saloon on schedule and updated Land Rover models later this year," Business Secretary Peter Mandelson said in a statement.

"The government had offered bridging finance from the automotive assistance programme if necessary. We understand the Tata group will now be successful in resolving longer term financial needs but we are willing to help again if necessary."

Britain pledged in January to guarantee up to 2.3 billion pounds of loans, including 1.3 billion pounds from the EIB, to help its ailing car industry cope with a slump in demand.

More than 14,000 workers are employed at Jaguar Land Rover's five British sites. Tata bought Jaguar and Land Rover from Ford in June last year for about $2.3 billion.
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 Spices turn weak on subdued demand
NEW DELHI, Aug 11 (PTI): After witnessing persistent rise for the past few days, red chilli and turmeric fell back to close up to Rs 300 per quintal down in the national capital on slowdown in buying by stockiest at prevailing higher prices. Weak trend in most of the spices at futures market too put pressure on the prices in spot trading at wholesale market here.

Red chilli and turmeric prices fell up to Rs 300 to Rs 6,000-10,100 and Rs 8,800-10,200 per quintal. Jeera common and best quality also lost Rs 200 each to settle at Rs 11,300-11,600 and Rs 14,200-14,700 per quintal.

Market men said fall in demand from retailers at higher levels mainly pulled down select spice prices.
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 Priyagold to launch chocolates in September (WIT PIC)
NEW DELHI, Aug 11 (PTI): After successfully launching juices, leading biscuit brand Priyagold is planning to enter the chocolates segment with the long-term aim of becoming a major player in the FMCG food products. Surya Food and Agro, which has recently added wafers and cookies to its portfolio, will launch chocolates next month, the company’s Director Shekhar Agarwal said.

"We hope to launch it in the first week of September as the temperature would come down by that time," Agarwal said, adding that summer is not a good season to launch a product like chocolates. The company aims to generate sales of Rs 25-30 crore from chocolates, wafers and cookies this year, he added.

According to a Nielsen survey, the chocolate market is estimated at about Rs 1,900 crore and growing at 18-20 per cent with Cadbury being the leader having 72 per cent share. Other major players include Nestle and Amul.

Agarwal said Priyagold would also introduce candy and toffee, with the generic ''Eclair'' variety. "We have already completed sample testing and the feedback is good," he said.

To a query on pricing, he said the chocolates would be competitive with more quantity than the ones available in the market. He, however, added that the recent rise in prices of raw materials is denting the margin of the company.
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 Himachal firm to invest Rs.130 crore in Gujarat  
SHIMLA, Aug 11 (IANS): Himachal Pradesh-based frozen food manufacturer Himalya International has plans to invest Rs.130 crore in a new unit in Gujarat, a top company official has said.

"We will invest Rs.130 crore in the agro-food processing facility in Mehsana in Gujarat. For this, the government has initially allotted 22 hectares," Himalya chairman Manmohan Malik said.

Work on the Gujarat facility will begin this month, with commercial production slated to commence by September next year. The unit will produce ready-to-eat products made of vegetables, frozen mushrooms, mozzarella cheese, yogurt and various appetizers.

"The products will be marketed both in the domestic and overseas markets," added Malik, whose company is also listed on the Bombay Stock Exchange.

Himalya plans to produce 9,000 tonnes of mushrooms, 5,940 tonnes of mozzarella cheese and 9,000 tonnes of yoghurt annually, he said.

The company has tied up with a New Jersey-based importer and distributor, Global Reliance Inc, for marketing its products in the US.

"The Gujarat project will be funded through internal accruals, warrants and bank borrowings worth Rs.90 crore. The project will be 100 percent tax free for five years after start of commercial production," Malik added.

The company is aiming an annual turnover of Rs.400 crore with net profit exceeding Rs.80 crore.
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 Govt introduces cash management bills
NEW DELHI, Aug 11(AGENCIES): In a year of tight cash flows, the government has added another short-term bill to its arsenal to meet immediate need for funds. On Monday, it notified the introduction of cash management bills (CMBs) to supplement other short-term cash raising measures, including ways and means advances and treasury bills. The new bill will allow the government to raise finance only when it needs and avoid holding excess cash for longer duration.

The finance ministry, at present, finances the governments short-term need for funds through three types of treasury bills issued for 91 to 364 days and ways and means advances, which is borrowing from the RBI.

The treasury bills have a variable spread while the ways and means advances carry the same rate of interest as the repot rates. Therefore, in both cases there is an interest cost, which, given the scale of its operation, can be massive. The CMBs will carry a lower rate of interest and will, thus, benefit the government.

The government plans to borrow Rs 3, 97,597 crore from the markets through securities with a tenor of at least one year or more in this fiscal. The interest cost on the borrowings is pegged at Rs 2, 25,511 crore. CMBs are in vogue in economies like the United States, with a maturity profile that ranges from a few days to six months. The Indian finance ministry has, however, stated that its cash management bills will be issued for maturities of less than 91 days.
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Sowing to be 20 %: Finance Minister (WIT PIC FINANCE MINISTER)
NEW DELHI, Aug 11 (PTI): Food production in the current fiscal is likely to go down as sowing will be 20 per cent lower due to the weak monsoon, Finance Minister Pranab Mukherjee said on Tuesday.Also, 161 districts have been declared drought-prone, he added.

However, indicating that this is unlikely to dampen the overall economic scenario, Mukherjee said he is in agreement with the Reserve Bank of India's growth projection six per cent and above for the current fiscal. Also, he is confident that the direct tax collection target of Rs 3.7 lakh crore will be surpassed for the current fiscal, he added.

Prime Minister Manmohan Singh on Monday met Commission for Agricultural Costs and Prices (CACP) Chairman Mahendra Dev, who apprised him about measures required to tackle the situation arising out of the deficient and delayed monsoon.

In the meeting, which follows Prime Minister Manmohan Singh's meet with Chief Secretaries, discussions were held on the drought situation, the right to food law and long-term policies to improve the farm sector.

Singh also met 13th Finance Commission Chairman Vijay Kelkar and Planning Commission Secretary Sudha Pillai and is believed to have discussed the drought situation in different parts of the country.
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 Mayawati calls for public-private partnership in pvt sectors (wit pic mayawati)
LUCKNOW, Aug 11 (PTI): Uttar Pradesh Chief Minister Mayawati has directed the industrial development department to promote participation of private sectors in industrialisation through public-private partnership.

During a high-level meeting held on Monday to review schemes launched by the department to promote investment in the industrial sector, the CM directed the officials concerned to ensure effective implementation of 'Nivesh Mitra', a scheme launched by the government.

The CM said that the scheme has been launched to ensure that industries get required approvals, sanctions and certificates within the stipulated time.

"Problems being faced by the industrialists should be sorted out on priority and better infrastructure facilities should be ensured to accelerate industrial development in the state," she said.

In order to generate employment opportunities it is necessary that industrial units were set up within the time frame and start manufacturing, she added.

The officials informed the CM that within a short time 211 investment proposals has been received.

"While 183 investment proposals are related to micro industry, 24 are for small industries, two for medium and one for large industry," they said.

The officials said that Greater Noida has been nominated as the nodal agency for Dadri-Noida-Ghaziabad investment area being developed as a part of the Delhi-Mumbai Industrial Corridor Project.
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 Govt will use its might to contain food inflation: PM (WIT PIC pm )
NEW DELHI, Aug 11 (PTI): Faced with the dichotomy of overflowing granaries and rising commodity prices, Prime Minister Manmohan Singh on Tuesday said the government will do "everything possible" to put the lid on food inflation.

He conveyed this to business chamber FICCI-led delegation that called on him.

"Prime Minister was quite confident that given the buffer stock, government would be able to handle the food inflation," FICCI Secretary General Amit Mitra told reporters after the meeting.

Central agencies like Food Corporation of India have buffer stocks of over 50 million tonnes of rice and wheat.

The delegation, which met the Prime Minister against the back of drought in several parts of the country, was informed that the government go-downs were brimming with food grain stocks and that it would do "everything possible" to ensure that there is no food inflation.

While the Wholesale Price Index based inflation remains negative, prices of essential commodities like pulses, sugar and vegetables have skyrocketed in the past few months.

The Prime Minister informed the business leaders that the government was gearing up the public distribution system (PDS) to mitigate the impact of deficient rains. As many as 141 districts have been declared drought-hit.
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 Monster, ITC to launch rural job portal   (WIT PIC)
NEW DELHI, Aug 11 (IANS): Online headhunter Monster India and ITC e-Choupal, a digital platform for farmers, have tied up to launch a website for job seekers in rural India.

The website has been named Rozgarduniya.com, the companies said in a joint statement on Tuesday.

The website will provide a platform for corporates to access rural talent.

"We believe Rozgarduniya.com will act as a catalyst and play an instrumental role in the government's vision of inclusive growth in India," said Sanjay Modi, managing director of Monster.com (India, Middle East and Southeast Asia region).

"We hope to expand this offering to nine states and 40,000 villages through the ITC e-Choupals in the future," he added.

ITC's agri business division head S. Sivakumar said his company was "delighted" to share e-Choupal's rural reach with Monster India.

Rozgarduniya.com will be launched in English and Hindi.

Subsequently, the portal will be available in other regional languages, the statement added.
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Audit of Reliance Industries' books not done: CAG

Posted in Business


Audit of Reliance Industries' books not done: CAG
NEW DELHI, Aug 10 (IANS): India's official auditor has said his office was yet to ratify the Rs.45,000-crore ($9-billion) capital expenditure claimed by the Mukesh Ambani-led Reliance Industries for tapping natural gas from the Krishna-Godavari basin.
"We are still to complete the audit of Reliance Industries' books. We don't have the mandate to audit the books of a private company. That is why the books were not made available to us," Vinod Rai, Comptroller and Auditor General (CAG) of India, said.

"We are in touch with the government to complete the audit at the earliest," Rai said, even as officials at the audit office said a letter had been written to the oil ministry to get relevant documents and responses from Reliance.

The remarks clearly run contrary to a statement by Director General of Hydrocarbons V.K. Sibal that the office of the Comptroller and Auditor General of India had already carried out the necessary audit on the matter.

The remarks also assume significance in the wake of the Anil Ambani group alleging that Reliance Industries had gold-plated - or grossly overstated - the capital expenditure for the production of gas from the Krishna-Godavari basin.

Subsequently, the Director General of Hydrocarbons - the regulator and custodian of the country's oil assets - had said that the capital expenditure was above board since the official auditor has duly looked it into the same.

"The CAG team has carried out the audit work. A CAG audit has recently been completed," Sibal had said in a statement, while seeking to give a clean chit to Reliance Industries.

"The idea of gold-plating betrays a lack of knowledge of business economics. Inflating the expenditure does not benefit any stakeholder -- neither the contractor nor the government," he said.

"No company would like to increase its investment unproductively. Every additional dollar of wasteful investment dents the profit of the contractor."

However, the Anil Ambani group had said that Reliance Industries had deliberately inflated the capital expenditure, adding that the same will result in losses worth billions of dollars to the government.

The Anil Ambani group said based on the original estimate of the gas output of 40 million units a day, when the fields were handed over to Reliance Industries, the capital expenditure was pegged at Rs.12,500 crore ($2.5 billion).

How can this more than triple to $9 billion when the output has been envisaged to only double to 40 million units, questioned the Anil Ambani group.

In June, the Bombay High Court asked Reliance Industries to supply 28 million units of gas from the fields to Anil Ambani-led Reliance Natural Resources for 17 years at $2.34 per unit.

However, Reliance Industries challenged the verdict in the Supreme Court, which heard the case July 20 and fixed Sep 1 as the next date of hearing. The court also asked all parties to file their replies on the government position on the matter by then.
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Airlines focus on fuel hedging as price inches up
WASHINGTON, Aug 10 (Agencies): Top US and European airlines, groping for a toehold on recovery amid economic downturns, are adjusting their fuel-hedge strategies to control that huge expense, which has been climbing higher.
It is a tricky business for the troubled industry, whose top costs are labor and fuel.
While labor costs are largely fixed and predictable, volatile fuel prices track crude oil, which has traded in a $100 range since last summer.
Even when fuel prices are falling, they can still be detrimental to carriers, who can lose money on useless hedges.
"Rising fuel costs during the second quarter and now into the third quarter are a huge concern," Southwest Airlines Chief Executive Gary Kelly said on a conference call last month.
"We do have hedging in place to provide some protection. But, of course, it couldn't be absolute protection," Kelly said. "So our outlook for the next three quarters is cautious given the economic and fuel price outlook."
US-based Southwest unwound its hedges somewhat in 2009 after its fuel-hedge portfolio lost money when oil prices tumbled 80 percent in late 2008 but it was Southwest's thorough fuel hedges that insulated it from soaring energy costs that ravaged rivals in the first half of 2008.
Other airlines like US Airways Group also scaled back their fuel hedges after plummeting oil prices led to large quarterly charges.
However, NYMEX crude oil has climbed some 64 percent this year, trading near $71 a barrel on Friday, and carriers are slowly ramping up their hedges again.
The NYMEX heating oil contract, which is used as the benchmark for jet fuel trades, has shown surprising strength as have the cash differentials.
Along the U.S. Gulf Coast, where most US-made jet fuel is produced, the wholesale price of jet fuel has gone from $1.79 a gallon in June to $1.92 a gallon earlier this week.
Nevertheless, some analysts believe airline fuel hedges are perpetually insufficient.
"They have increased a little bit but not as much as you would have expected," said Basili Alukos, airline analyst at Morningstar. "Just given that fuel was so low, I would have preferred for them to have gone all in."
U.S.-based airline consultant Robert Mann agreed.
"They'll all go out of their way to hedge interest rates and foreign exchange, but they seem reluctant to take on fuel," Mann said.
"None of them have done very much on the natural hedging side, which is bringing in newer, more fuel-efficient aircraft," Mann said.
European airlines also stepped up hedging in the last quarter to protect themselves against the risk of a sustained crude price rally.
Budget airline Ryanair has hedged up to 90 percent of its fuel needs for the remainder of 2009 in a move that it hopes will cut expenses by 460 million euros over the fiscal year.
The oil price spike to $147.27 a barrel last July prompted the carrier to freeze its hedging program, and this strategy allowed it to enjoy wider profit margins when oil prices sank to under $33 a barrel last December.
German flag carrier Lufthansa is maintaining an extensive hedging policy that covers up to 85 percent of its fuel purchases. The airline said it would start making money on its hedging program if crude prices reach $90 a barrel this year.
The airline reported a net loss of 216 million euros in the first half of 2009, down from profit of 318 million euros a year earlier. Air France-KLM said it lost 252 million euros on its fuel hedging program alone between April and June.
In addition to crude oil, airlines also use gas oil futures traded on the IntercontinentalExchange (ICE) as a hedging proxy for jet fuel.

Traders said weak gas oil prices in July - the main component of the jet fuel price - had encouraged airlines to fix future costs.
The premium of gas oil futures to crude oil, known as the crack spread, traded at a five-year low of less than $5 a barrel on (ICE) in early July because of huge supply overhang in the European middle distillates market.
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'Engineering exports to remain flat this fiscal'
KOLKATA, Aug 10 (IANS): India's engineering exports are expected to remain flat this fiscal at $37.5 billion, a senior industry official said here Monday.
"We grew by about 15 percent in 2008-09 to $37.5 billion. At the end of this fiscal if we can sustain this figure that will be excellent," Rakesh Shah, former chairman of the Engineering Export Promotion Council (EEPC) told reporters.

EEPC India is the apex body of engineering exporters in the country.

He attributed this flat projection to the ongoing economic slowdown, which has hit almost all industries.

In the April-July period, exports dropped 23 percent year-on-year, Rakesh Shah said.

Last fiscal, engineering exports in April-September grew by about 44 percent, but it dropped 21 percent during October-March due to the slowdown.

The 15 percent growth in revenue last fiscal was possible due to the 44 percent growth in the first six months of the fiscal, Shah said.

Anupam Shah, vice-chairman of the council, said: "The risk perception of exports is very high today."

EEPC India has submitted a draft proposal to the central government asking for a corpus of Rs.500 crore to modernise the industry and make engineering units more competitive.

"The finance minister (Pranab Mukherjee) is actively considering this," said Rakesh Shah.

EEPC has around 12,000 members.
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Car sales jump 31 per cent in July
NEW DELHI, Aug 10 (IANS): Domestic car sales increased by nearly 31 percent to cross 115,000 units in July from about 88,000 units in the same period a year ago, an industry body said on Monday.
Sale of motorcycles rose over 19 percent to nearly 546,250 units from about 457,200 units, said Society of Indian Automobile Manufacturers (SIAM) in a statement.

According to SIAM, the total two-wheeler sales surged 20 percent in July to about 719,670 units compared to 599,370 units in the corresponding month last year.

Sales of trucks and buses rose 9.6 percent from a year earlier to over 37,620 units, SIAM's data showed.
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Chennai Petro defers crude unit shutdown to Oct
CHENNAI, Aug 10 (Agencies): Chennai Petroleum Corp has deferred its planned two-month shutdown of nearly a third of its 190,000 barrels-per-day (bpd) Manali refinery in southern India by a month to meet local fuel demand, its managing director said on Monday.
"We were planning to shut CDU-III (crude distillation unit) and attached downstream units from Sept. 10 but now we will be taking the about two-month shutdown from sometime in early October," K. K. Acharya said.
The CDU-III has a capacity of 60,000 bpd.
The shutdown is aimed at routine maintenance and to increase capacity by 20,000 bpd, Acharya said.
The revamp will increase the refinery's annual naphtha output by 115,000 tonnes, diesel production by 170,000 tonnes and fuel oil capacity by 330,000 tonnes a year, according to the company's website.
Annual production of liquefied petroleum gas will be raised by 24,000 tonnes and jet/kerosene by 285,000 tonnes a year after the revamp.
Acharya said Chennai Petroleum plans to upgrade a part of its total naphtha production to gasoline by revamping its existing catalytic reforming unit (CRU).
The CRU's annual capacity would be raised to about 300,000 tonnes after the revamp from the current 225,000 tonnes, he said.
Chennai Petroleum is a unit of India's largest state-run refiner, Indian Oil Corp. It operates two refineries in southern India with a total capacity of around 210,000 bpd.
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MetLife enters health insurance segment
BANGALORE, Aug 10 (PTI): MetLife India Insurance company Ltd (MetLife) on Monday announced its entry into the Indian health insurance segment with the launch of ''Met Health Care''.
Met Health Care offers its customers a daily cash benefit in case of hospitalisation and a lump sum benefit in case of critical illness or accidental and permanent disability, the company said in a statement.
Further, customers are not required to undergo any medical tests to avail this plan, it said. MetLife Managing Director Rajesh Relan said, "Met Health Care is being launched with comprehensive training to all financial advisors across the country to provide need-based solutions to our customers".
The company said it grew at 40 per cent last year while the industry was facing a slowdown.
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Daiichi Sankyo says to delay offer for Zenotech
TOKYO, Aug 10 (Agencies): Japan's third largest drugmaker, Daiichi Sankyo, said on Monday it would again delay its open offer for a 20 percent stake in India's Zenotech Laboratories after an Indian court asked it to postpone the launch.
The Securities Appellate Tribunal requested Daiichi Sankyo put the offer on hold because of a petition by one or more minority shareholders of Zenotech about the price of the offer, which was originally scheduled to start on Tuesday, Daiichi Sankyo spokesman Yasunori Sasaki said.
The appeal court will hold a hearing on Sept. 4 on the petition, after which Daiichi Sankyo will make a decision on the open offer, he said, without elaborating on possible options.
Daiichi Sankyo believes its offer to buy each Zenotech shares for 113.62 rupees is fair, Sasaki said.
Daiichi Sankyo originally said in January it would launch the offer in March. However, the offer has already been delayed twice, first by a prolonged review by the regulators and later by a high court hearing on the petition.
The high court turned down the petition and reversed an earlier injunction suspending the offer.
India's generic drug maker Ranbaxy Laboratories, in which Daiichi Sankyo bought a majority stake last year, has a stake in Zenotech, a smaller generic drug maker.
The purpose of Daiichi Sankyo's tender offer for Zenotech shares is mainly to meet Indian law which requires Daiichi Sankyo to hold an open offer for Zenotech shares after buying the controlling stake in Ranbaxy, Daiichi Sankyo said earlier.
Shares of Daiichi Sankyo were up 0.3 percent at 1,775 yen, performing mainly in line with the broader pharmaceuticals sector which edged up 0.5 percent.
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Crisis shifts balance of economic power to Asia: WTO economist
BANGKOK, Aug 10 (DPA): The world economic crisis is expected to shift more economic power to Asia, where signs of recovery are showing sooner than elsewhere, the World Trade Organisation's (WTO) chief economist predicted Monday.
"The crisis has changed the world," Patrick Low, WTO chief economist, said at a press conference in Bangkok.

"I think it's going to shift the balance of relative power (to Asia), precisely because of the manner in which this region is recovering."

The WTO economist acknowledged that the world financial crisis has not been as severe in Asia as anticipated, particularly in the region's largest economies such as China and India.

Even so, the trade organization's chief economist warned of several looming dangers to the region.

"There is a question of whether or not we're going to have a double dip because of the need to bring prices back in control if inflationary pressure picks up as a consequence of all the stimuli that have been exercised in the region," Low said. "We're not quite out of the woods yet."

He said the WTO fears that the worst crisis since the 1930's Great Depression may significantly alter attitudes towards free trade.

"The issue is really about whether attitudes towards trade, attitudes towards globalisation, financial regulations, savings behaviour in large economies, whether these attitudes are going to change in such a way as to essentially create a long-term de-globalisation in the world economy," Low said.

The WTO projects global trade will shrink 10 percent in 2009.

The trade organisation, which has been trying to push through the Doha Round of a new global trade agreement since 2001, is hoping that negotiations will be finalised next year.

"So far, although there have been some protectionist noises in the underbrush, it's fair to say governments have been impressively restrained with respect to resorting to protectionist measures," Low said.

"Some people think that the crisis can concentrate minds in the negotiations, but that we haven't quite seen yet."
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Bulls take a breather, key indices slip 3 percent

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Bulls take a breather, key indices slip 3 percent

 Bulls take a breather, key indices slip 3 percent
MUMBAI, Aug 8 (IANS):  Though the  benchmark indices touched a 14-month high this week, continued selling pulled them down three percent from their last weekly close, as the government voiced concerns that the revival of the economy may be hampered due to deficient rains.

Bourses across the world touched highs not seen in 9-10 months, mainly backed by improved corporate earnings and a positive job market report in the US.

However, the 30-share sensitive index (Sensex) of the Bombay Stock Exchange (BSE) fell 510.07 points or 3.26 percent over previous Friday's close and ended trade at 15,160.24 points.

The broader S&P CNX Nifty of the National Stock Exchange (NSE) followed the Sensex, moving down 3.34 percent from its last weekly close to end at 4,481.4 points.

Both Sensex and Nifty had touched a 14-month high Monday.

Mid-sized companies in terms of market capitalisation did no better with the BSE's midcap index closing 2.47 percent lower. However, smaller companies lost less with the BSE smallcap index going down 0.19 percent.

Data with markets watchdog Securities and Exchange Board of India (SEBI) showed that foreign funds were net buyers during the week, having bought scrips worth $154 million.

Indian equities started the week with a bang, with both indices rising smartly. While the Sensex ended Monday with gains of 253.92 points or 1.62 percent at 15,924.23 points, the Nifty moved up a similar 1.6 percent to 4,711.4 points.

Consolidation set in Tuesday, with the bulls stalling their buys and booking profits. The Sensex ended trade on a low, moving down 93.25 points or 0.59 percent to 15,830.98 points. The Nifty, too, shut shop in the red at 4,680.5 points, down 0.66 percent.

Investors started cautious Wednesday, with both Sensex and Nifty languishing in the red for most of the day. It, however, recovered to shoot up into the green, an hour before close, only to give up sizeable gains and end slightly up.

The Sensex shut shop at 15,903.83 points, up 72.85 points or 0.46 percent, while the Nifty closed at 4,694.15 points, 0.29 percent higher.

Thursday saw some heavy selling in frontline stocks in the last trading hour, pulling down the Sensex 389.8 points or 2.45 percent to 15,514.03 points.

Similarly the Nifty shut shop in the red at 4,585.5 points, down 2.31 percent.

The selling continued Friday, as the Sensex closed down 353.79 points or 2.28 percent at 15,160.24 points. The Nifty shut shop in the red at 4,481.4 points, down 2.27 percent.

The top weekly gainers on the Sensex included Reliance Industries (up 2.2 percent), Wipro (up 2 percent) and Hindalco (up 1 percent).

Among top losers were Maruti Suzuki (down 8.6 percent), ITC (down 7.9 percent), Hero Honda (down 7.9 percent), Hindustan Unilever (down 7.5 percent), and DLF (down 7.3 percent).

In other Asian markets, the benchmark index of the Tokyo Stock Exchange touched a 10-month high this week, while European shares rose to a nine-month high Friday.

In the US, stocks rose as the government reported that job losses in July were far less than expected. Key indices like the Dow Jones Industrial Average and the Standard and Poor's 500 closed near their respective 2009-highs Friday.
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 12 Goa mines near wildlife sanctuaries face closure
 PANAJI, Aug 8 (IANS): Twelve mines, including one owned by Sesa Goa, face closure because of their proximity to wildlife sanctuaries.

Director of Environment Michael D'Souza directed the Goa State Pollution Control Board (GSPCB) through a letter dated Aug 6 to stop mines which "have not obtained any clearances from the statutory authorities".

The list of mines includes Sesa Goa mines at Codli village, two mines operated by Shantilal Khushaldas Bros at Rivona, which do not have the required clearances and sanctions from the forest department.

Another mine belonging to Damodar Mangalji, which is also under investigation, is located in a lease area which is a protected site which has ancient rock carvings.

The administrative action follows an assurance given to the state assembly Thursday by Environment Minister Aleixo Sequeira that all mines near wildlife sanctuaries would be ordered to stop operations.

"The undersigned has assured the august house that in case alleged illegalities are found to be true, the department of environment will immediately ensure necessary action to stop all such activities," Sequeira wrote in a note to the environment secretary a few hours after the assurance to the assembly.

"The note from the honorable minister for environment is self explanatory, along with it is a list of 12 mines which are operating without fulfilling the requisite conditions or without having obtained any clearances from other statutory authorities," D'Souza has said.

The issue of illegal mining has been one of the main features of the monsoon session of the Goa legislative assembly. A high level committee appointed by the chief minister has also thrown light on several instances of illegal mining in the state.

The opposition has repeatedly alleged that several cabinet ministers were involved in illegal mining. Leader of opposition Manohar Parrikar had also alleged that nearly 18 percent of Goa's mining exports were fed by illegal mining.

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Indian firm to build eye centre in Addis Ababa
ADDIS ABABA, Aug 8 (IANS): Indian project development firm Overseas Infrastructure Alliance (OIA), involved in diverse projects in Africa's second-most populous nation, will build an eye care centre in the premises of the Zewditu Memorial Hospital here as part of its community partnership programme. The project has been lauded by Ethiopia's President Girma Woldegiorgis.

Speaking at the groundbreaking ceremony for the hospital, Woldegiorgis said close to 2.3 million blind people live in Ethiopia, out of which 1.3 million are totally blind. He said there was a severe shortage of health facilities and eye care specialists that offer medium and large scale services in the country.

Girma expressed gratitude to Indian Ambassador Gurjit Singh on behalf of the people of Ethiopia for encouraging OIA to help set up the facility. The establishment of the eye care centre shows the ever-increasing people-to-people ties between Ethiopia and India, he added.

Addis Ababa Mayor Kuma Demekissa said Menelik II and Ras Desta Damitew Hospitals are the only hospitals in the city that offer medium- and large-scale eye care services and the new centre will help add up to the service given in the city.

Gurjit Singh said that the hospital would be the second hospital from the Indian people after the Gandhi Memorial Hospital that was established some 60 years ago. He said the facility would boost Ethiopia-India friendship.

OIA chairman V.B. Soni said the company will construct a state of the art eye care centre, outpatient service with modern diagnostic facilities, minor and major operation theatres, inpatient services, and administrative offices. The two-storey opthalmology centre on 2,000 sq metres will also be equipped with modern diagnostic, clinical and office equipment and furniture, he said.

OIA is also participating in sugar production expansion projects in Ethiopia after the Indian government extended a $640 million loan for the project. Besides, it is also involved in the rehabilitation of the Ethiopia-Djibouti rail link.

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 We've rescued our economy from catastrophe: Obama
WASHINGTON, Aug 8 (IANS): Amid signs of recession nearing an end with job losses tapering off and unemployment falling for the first time in more than a year, President Barack Obama took credit for rescuing the US economy from "catastrophe."

"Today we're pointed in the right direction," he said shortly after the Labour Department Friday reported a net loss of 247,000 jobs in July, the fewest job losses since August 2008 with the unemployment rate surprisingly inching down to 9.4 percent.

"We're losing jobs at less than half the rate we were when I took office. We've pulled the financial system back from the brink," he said. "While we've rescued our economy from catastrophe, we've also begun to build a new foundation for growth."

The Labour Department report also revised job loss in June lower-to 443,000 job losses from 467,000.

The unemployment rate fell to 9.4 percent from 9.5 percent in June, the first decline in that closely watched reading since April of 2008.Economists cited by CNNMoney.com expected unemployment to rise to 9.6 percent.

The unemployment rate fell even as employers continued to cut jobs because the Labour Department estimated there were 237,000 fewer people it counted as unemployed.

There was also plenty of bad news as the number of people unemployed for more than six months continued to rise, reaching nearly 5 million people, a record high.

The Labour Department also said that one reason for the declining number of job losses was because cuts had been so deep leading up to July that there were fewer workers to lay off during the seasonal shutdown that happens in some factories, such as those in the auto industry.

Since the start of 2008, 6.7 million jobs have been lost in the US Several economists said that while the report confirms other economic readings suggesting that the recession may be ending, it's too soon to predict a sharp gain in jobs in the near term.

"The dawn of an economic recovery is here," said Sung Won Sohn, a professor of economics at Cal State University Channel Islands, as cited by CNNMoney.com.

"The economy is in the process of bottoming, but the job market will lag behind. Businesses, which engaged in preemptive layoffs earlier, are not about to start hiring people."

Robert Brusca of FAO Economics said he believes there is more strength in the job market than many people are willing to acknowledge. He said that the government may even report an overall payroll gain for August next month.

"There is nothing about these numbers that suggest it's a fluke," he said.
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Obama appoints Indian-American to key commerce post
HOUSTON, Aug 8 (PTI): President Barack Obama has appointed Indian-American attorney Ro Khanna to a key post in the US Commerce Department, where he will work to open foreign markets to American technology.

32-year-old Khanna, a prominent attorney who specialised in intellectual property law at O'Melveny and Myers' San Francisco office, was sworn in earlier this week as Deputy Assistant Secretary for domestic operations of the US and Foreign Commercial Service, International Trade Administration.

Among his duties will be to lead trade missions to countries like India and China.

"I look forward to working to strengthen American competitiveness, increase exports and create good-paying jobs here at home," he said in a statement.

Khanna is expected to report to Francisco 'Frank' Sanchez, Obama's nominee for Under Secretary for International Trade at the Department of Commerce. Sanchez is up for Congressional confirmation in the fall.

Khanna will oversee 109 US Export Assistance Centers operating in 47 different states.

His appointment by Obama is being seen by observers as reflection of the growing political clout of the Indian-American community.

Khanna's Indian roots, observers say, will help advance US interests when it comes to difficult trade discussions with India.

Khanna, who was born in Philadelphia and earned his law degree at Yale University, has political roots reaching back to India.

His grandfather, Amarnath Vidhyalankar, spent four years in jail during the independence movement. After India gained independence in 1947, he became a Member of Parliament.

In 2006, Khanna was appointed by then-House Minority Leader Nancy Pelosi to chair the Indo-American Council for Democrats. And until recently, he chaired the Indo-American Council of Democratic Congressional Campaign Committee.

Khanna attended the University of Chicago, where he earned a Bachelor's in Economics and did door-to-door campaigning for the future President in 1996 when Obama ran for the Illinois Senate.
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Take action against hoarders and black marketers, says PM
NEW DELHI, Aug 8 (PTI) Prime Minister Manmohan Singh today said the Centre and States should not hesitate to take strong measures including against hoarders and black marketers to check the spiraling prices of essential commodities in the wake of delayed and deficient monsoon.

"In short, the contingency plan for crops, drinking water, human and animal health, fodder, etc should be brought into operation without delay and a close watch kept on availability of food grains and prices of essential commodities," he said addressing a conference of state Chief Secretaries.

Agriculture Minister Sharad Pawar, Cabinet Secretary K M Chandrasekhar and Union Agriculture Secretary T Nanda Kumar were among those who attended the meeting.

Assuring Centre's full support to states regarding any additional assistance that may be required, Singh said "there is need for us to act promptly, collectively and effectively.

In no case should we allow citizens to go hungry."

The meeting was called against the backdrop of poor monsoon and the spectre of drought looming large over several parts of the country. The Prime Minister himself said that 141 districts in the country have been declared drought affected but no state has so far sent memorandum seeking assistance.

The Prime Minister referred to the possibility of reduced production of kharif crops having an inflationary impact on prices of food items in the coming months.

Reliance Industries speaks on gas dispute
MUMBAI, Aug 8 (IANS): Breaking its silence on the ongoing dispute with the Anil Ambani group over gas from Krishna-Godavari basin, Mukesh Ambani-led Reliance Industries (RIL) Friday said it will comment on the matter only in the court.

Soon after, the Anil Ambani group reacted saying the statement was vague and general, without providing a single response to the issues it has raised in areas ranging from contractual obligations to capital expenditure on the Krishna-Godavari gas.

The group also said that RIL was deliberately "shortchanging" state-owned power utility NTPC to the tune of up to Rs.30,000 crore "by reneging on a binding gas supply contract at $2.34 per unit".

"Typical of RIL's conduct even after weeks of silence, it has evaded substantial issues of national and public interest that have recently come under a watchful nation's spotlight," said J.P. Chalasani, chief executive of Reliance Power, an Anil Ambani group company.

"With no possible defence on merits, RIL has resorted to vague generalities and not provided a single specific response to grave charges. This is in line with RIL's unfortunate practice of never coming on record and instead only falling back on selective leaks and un-attributable comments to media."

Earlier, Atul Chandra, president of the petroleum business with Reliance Industries, while reading out a written statement before reporters here had said: "Our legal advisors have counseled us to refrain from commenting on the issue.

"We emphatically refute and out rightly reject the baseless and motivated allegations and insinuations made by Anil Ambani and his associates against Reliance Industries and its chairman Mukesh Ambani."

Responding to the RIL statement, Chalasani said, "RIL is taking refuge under a false cover of ongoing legal proceedings to skirt questions of national importance."

Chalasani also said RIL had not responded to specific issues, some of them being:

Incurring disproportionate capital expenditure on Krishna Godavari D6 block, which could potentially cause losses of up to Rs.30,000 crore to the government of India

Hiding facts on disproportionate capital expenditure through tainted reports of alleged independent experts who actually had serious and undisclosed conflict of interest with RIL

Hoarding of gas by artificially curbing production to justify exorbitant pricing when global gas prices collapsed by over 75 percent

Raising the bogey of revenue losses to the government to shamefully appropriate for itself the legal and unethical super profits of over Rs.50,000 crore

Responding to RIL chairman Mukesh Ambani's purported remarks, Chalasani quoted Reliance Power chairman Anil Ambani as saying: "I am pained that under my respected elder brother's leadership RIL is still doing everything in its power to renege on its binding commitment to supply gas to us.

"This is contrary to the fundamental values of trust and integrity that my visionary father Dhirubhai Ambani stood for and on the basis of which he founded Reliance.

"Whatever is the reason, and I have no idea what it is, corporate greed, personal vendetta, misguided advice from the three Cs that is chelas, cha-chas and cronies, it is unfortunate and deeply distressing to me at a very personal and emotional level."

Maintaining that there was personal gains for Anil Ambani, Chalasani added: "The only private and personal gains are unfortunately to RIL and its promoters."

He also said the publicly-owned gas transportation company had been surreptitiously and deceitfully appropriated and transferred to private hands at the cost of RIL's about 20 lakh shareholders.

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Satyam, Maytas will be prosecuted if found they diverted funds
NEW DELHI, Aug 8 (PTI): The government is investigating whether Satyam and Maytas siphoned off funds from their respective companies and whosoever is found guilty would be prosecuted according to the law.

Revealing this, Corporate Affairs Minister Salman Khurshid said on Saturday, “any aspect, any dimension relating to their (Maytas and Satyam) relationship is under investigation reports would be made available whether money has been siphoned off and then the law will take its own course.”

Reports have been doing the rounds that Maytas Properties and Maytas Infra, the firms promoted by the founder of Satyam, B Ramalinga Raju, had diverted money. Speaking to reporters on the sidelines of a Assocham event, the minister said prosecution in the multi-crore Satyam fraud case would be carried on an urgent basis.

“The core issues are accountability of people in Satyam and we now want to give undivided attention to prosecution...you can treat it as highest urgency,” he added. The CBI has already filed a charge sheet in the Satyam scam which came into light early this year when Raju confessed to manipulating books of accounts of the company for several years. However, the Serious Fraud Investigation Office, which investigated the case, is yet to file a charge sheet.



 

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India-US trade summit to focus on collaborations

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India-US trade summit to focus on collaborations
BANGALORE, Aug 7 (IANS): Cashing in on the upswing in ties following the visit of US Secretary of State Hillary Clinton, on September 10-11, the India-US trade summit in New York will explore collaborations in diverse sectors to boost investments in both countries.
"The summit for US-India Trade and Economics (SUITE 2009) will focus on investment-driven collaborations in education, environment, power and energy, business and financing, IT, infrastructure, food processing and healthcare," said Indo-American Chamber of Commerce (IACC) secretary general R.K. Chopra.

Senior representatives of governments and trade bodies of both sides will participate in the event that will showcase business and investment opportunities.

UN Secretary General Ban Ki-moon and New York mayor Michael Bloomberg are among the prominent leaders who will address the summit.

The Indian government will be represented by Commerce Minister Anand Sharma, Power Minister Sushilkumar Shinde, Food Processing Industries Minister Subodh Kant Sahay and Minister of State for IT and Communications Gurudas Kamat.

About 100 chief executives from India Inc, senior officials, policy makers, entrepreneurs and experts in legal, finance and healthcare sectors have confirmed their participation," Chopra said.

Heads of American firms, academic experts and consultants will also be present.

From this tech hub, global networking products major Cisco's Indian subsidiary, IT bellwether Wipro and Quest will be among the firms representing large, medium and small enterprises.

Though bilateral trade nearly tripled to $42 billion in 2007-08 from $14 billion in 2000, the financial crisis and the subsequent recession in the US have dipped Indian merchandise exports in the first five months of 2009 to $8.5 billion from $10.9 billion in the year-ago period.

In 2008, US exports to India were $17.68 billion while imports from India stood at $25.7 billion.

Similarly, in services trade, Indian exports increased steadily to $9.35 billion in 2007 from $1.89 billion in 2000, while imports from the US gathered momentum to touch $9.6 billion in 2007 from $2.54 billion in 2000.

According to the US Bureau of Economic Analysis, travel, passenger and transport segments accounted for 45 percent of total services from the US to India.

Educational services contributed 24 percent, business, professional and technical services 14 percent and royalties and license fees 10 percent.

The Confederation of Indian Industry (CII) estimates the bilateral trades will double every three years to touch a whopping $320 billion by 2018.

A CII report entitled "India-US Economic Relations: The Next Decade" said considering that India accounts for a mere 1.3 percent of the US trade, there was huge potential to increase bilateral business in the next 10 years.

It recommended a comprehensive economic cooperation agreement, covering goods and services.

"As the only bilateral trade body between the two countries, we will take the initiative to advocate India as an innovation partner," said IACC Karnataka wing's chairman Vasanth Kini.

In this context, the chambers advocated incentives to US firms for setting up research and development centres in India.

The Indian delegation will also showcase opportunities in the healthcare sector, especially wellness tourism.

"The untapped areas for investments and partnerships are verification and legal services, aerospace, insurance and healthcare. The three agreements signed in nuclear, space and defence areas during Hillary Clinton's visit pave the way for greater collaborations in other areas," Kini said.


Gas allocation row again figures in Lok Sabha (wit pic)
NEW DELHI, Aug 7 (PTI): The issue of gas allocation from the KG-6 oilfield being developed by Mukesh Ambani's Reliance Industries again figured in the Lok Sabha on Friday with an AIADMK member alleging that southern states, especially Tamil Nadu, were being left high and dry.

Raising the issue during Zero Hour, M Thambi Durai said the company had secured a clearance from the Government for supply of gas from the KG basin in 2007 and it was supposed to lay main gas pipeline from Kakinada to Chennai.

Noting that the other pipelines were from Chennai to Tuticorin, Chennai to Bangaluru and Chennai to Cochin, he regretted that the company has not even dug a single KM for laying these pipelines.

"And deliberately, they are taking gas from Kakinada to Gujarat. They are concentrating only on Mumbai, Gujarat, Uttar Pradesh and other Northern states. The gas from Bombay High is already taken to U P and Bihar", he rued.

Thambi Durai said in the federal setup, all states have to be accorded equal rights, "but here is a situation where the southern states are suffering. Southern states, especially Tamil Nadu, are being ignored and neglected continuously by the Government of India".

He alleged that when "all this injustice" is being done, the DMK, despite being part of the central coalition, is keeping quiet.

The AIADMK member also wanted the Government to expedite exploration of natural gas from the Cauvery basin.


Life term for spurious drug peddlers: government (wit pic Ghulam Nabi Azad)
NEW DELHI, Aug 7 (IANS): Peddlers of spurious drugs can now be sentenced to life terms, parliament was informed on Friday.

"Short of capital punishment, everything that is possible under the law will be done to stamp out the circulation of spurious drugs," Health Minister Ghulam Nabi Azad said during question hour in the Rajya Sabha.

"I have signed the papers on Thursday. The new law will be notified within a week," Azad added.

"So far, the law was very mild. No action could be taken against those who were caught. Now there will be special courts to fast track trials. Up to life imprisonment can be awarded to those who manufacture and sell spurious drugs," the minister added.

Replying to a supplementary, he said the creation of a Central Drug Authority (CDA) was the "second step" in tightening the noose around manufacturers and peddlers of spurious drugs.

"We are holding a series of meetings with the pharmaceutical industry. The creation of the CDA will be the second step," Azad said.

Referring to the circulation of fake "Made in India" drugs in Nigeria, he attributed this to "unscrupulous elements" taking advantage of the growth of this country's pharmaceutical industry.

"The Indian pharmaceutical industry on Friday has a global presence. Unscrupulous elements are taking advantage of this. It has come to the notice of the government of India that such ("Made in India") drugs have been seized by the Nigerian authorities.

"A probe has revealed that these drugs originated from China," Azad said.

"There are international ramifications but the assistance of interpol has not been sought so far," he said in reply to a supplementary.


Attack by hackers brings Twitter to its knees  
WASHINGTON, Aug 7 (Agencies): Unidentified hackers brought the micro- blogging website Twitter to its knees for several hours on Thursday.

Twitter founder Biz Stone said the site, which was down altogether for about two hours, had suffered a so-called "denial of service" attack.

"We are defending against this attack," Stone said.

He added that Twitter would continue to update its site even though it remained under attack, and noted that the situation would be subjected to an investigation.

In a denial of service attack, hackers try to prevent access to a site by overloading it. As Stone explained, this kind of attack is most often used against online banking and credit card systems.

State govt to take steps to increase livestock population
SRINAGAR, Aug 7 (PTI) The state government is taking measures to increase hybrid livestock population in order to meet the rising demand of mutton, chicken and eggs in the state.

"We are taking steps to increase hybrid livestock population to meet the rising demand of mutton, chicken and eggs. This will also help in neutralizing capital outflow from Jammu and Kashmir," minister for animal and Sheep Husbandry Aga Syed Ruhulla said at a function here on Friday.

He said poultry production has assumed great importance in the state and has emerged as one of those agro-based industries which not only provides highly nutritious food but can also be a source of employment.

The minister reiterated the government's commitment to provide direct benefit to the farming community.

Both Ruhulla and the state minister for animal and sheep husbandry Ajaz Ahmed emphasised that innovative marketing strategies, embryo transfer technology, organized sheep and goat farming need to be explored and developed so that producers of livestock products are duly benefited.

They directed the Animal and Sheep Husbandry department officials to pursue new strategies for pasture development and improving fodder quality so that sufficient and nutritious fodder is available for the livestock even during winter season.


Power plants can now save on transmission cost
NEW DELHI, Aug 7 (PTI):  In a development that would help private power producers save significantly in constructing a dedicated transmission line, power regulator CERC said that power plants with a capacity above a certain level will be directly connected to the central grid. According to estimates, private power producers can save up to Rs 500 crore provided they are generating at least 250 MW hydro powers or 500 MW thermal powers.

According to the notifications released by the power sector regulator Central Electricity Regulatory Commission today, any generating plant having an installed capacity of at least 250 MW can seek connectivity with the inter-state transmission system. In order to encourage private players in the power sector, CERC Chairperson Pramod Deo said, "Private firms have always complained that public sector companies have access to Power Grid Corporation whereas they have to build the transmission network on their own.


Kingfisher gets 5-bln-rupee loan from SBI (wit pic)
FRIDAY, Aug 7 (Agencies): “After these notifications, 500 MW thermal plants and 250 MW hydro power plants and any bulk consumer having at least a load of 100 MW can seek connectivity with the inter-state transmission system, which is handled by PowerGrid.

Kingfisher Airlines Ltd had sought a 10-billion rupee loan from State Bank of India and has been sanctioned half that amount, a junior finance minister said on Friday.

The bank has sanctioned the loan on specific terms and conditions, Namo Narain Meena told Parliament in a written reply, but did not provide details.

Cash strapped Kingfisher Airlines has posted a net loss of 2.4 billion rupees in April-June and has appointed bankers to help it raise up to 5 billion rupees.

At 2:06 p.m., shares in Kingfisher were down 3.23 percent at 46.50 rupees in a Mumbai market which was down 2.2 percent.


Govt convenes meeting of CMs to address price situation (wit Manmohan’s stock pic)
NEW DELHI, Aug 7 (PTI): Acknowledging that the situation regarding prices of food items is serious, the government today said it was taking long and short term measures and Prime Minister Manmohan Singh will soon convene a meeting of Chief Ministers to address the problem.

Singh will probably meet the Chief Ministers on August 17 to specifically focus on measures to curb hoarding in the backdrop of reports of blackmarketing because of shortage of supplies, Agriculture Minister Sharad Pawar said, while replying to debate on price rise in the Lok Sabha.

Dissatisfied with the reply, Opposition NDA and Left Parties staged a walkout in the House.

"The situation is serious... The government has taken the entire situation very seriously," Pawar said as he outlined the steps that the government has taken and was contemplating to deal with the problem that had been aggravated by poor monsoon.

He said the government was ready to raise subsidy and import food items, especially pulses to bridge the demand-supply gap.

"We will also try to tell them (Chief Ministers) that every state has to take very deterrent and effective action against all hoarders", he added.

The government, the Minister said, has also convened a meeting of state chief secretaries tomorrow to discuss the issue of rising prices and the steps being taken to control hoarders and blackmarketeers.

National Solar Mission proposal gets in-principle approval
NEW DELHI, Aug 7 (PTI) The government on Friday said the Prime Minister's Council on Climate Change has given in-principle approval to the National Solar Mission proposal to achieve a target of producing 20,000 MW of solar power by 2020.

"A draft National Solar Mission document proposing a target of 20,000 MW for solar power by 2020 has received in principle approval of Prime Minister's Council on Climate Change in its meeting held on August 3, 2009," New and Renewable Energy Minister Farooq Abdullah said while replying to a query in Lok Sabha.

Abdullah said that government was planning to add 15000 MW capacity from renewable energy sources during the 11th Plan Period.

By the end of 11th Plan, renewable power capacity is likely to cross 24,000 MW, which would be around 12 per cent of the then installed power capacity in the country.

The Minister said that by the end of 13 plan, renewable power capacity would be around 54,000 MW.





Economy looking up, but scanty rains a problem: Mukherjee (wit Mukherjee’s pic)
NEW DELHI, Aug 7 (IANS): Finance Minister Pranab Mukherjee on Friday indicated the economy was beginning to look up but he was unsure of the way it was going because of the scarce rainfall this monsoon.

"Economy has started moving slightly, but still I am not sure, because other problems may come from the adverse impact of scanty rainfall," Mukherjee said in the Lok Sabha.

"The agriculture minister is making an assessment, we are also making assessment but this is a problem. We are trying to handle it," added Mukherjee.

According to initial estimates of the meteorological department, the annual monsoon rains are likely to be 25 percent below the 50-year average during June 1-Aug 5.

Mukherjee said the government would take all steps to mitigate problems caused by inadequate rainfall. He, however, admitted results of such actions would take time to be reflected in the economy.

"Even if we take action today, it will take some more time to get its full impact on the economy," said Mukherjee.

"We cannot expect the economy to move so soon. It is not like switch-off and switch-on," he added.
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