New Delhi, January 5
The lifting of ban on sugar exports is likely to be discussed in the next Cabinet meeting. "The issue (of lifting the ban) will be taken up in the next Cabinet meeting," Agriculture and Food Minister Sharad Pawar said here on the sidelines of a conference on bio-diesel.

With the production of sugar expected to be around 240 lakh tonnes and the total availability, including carry-over stock, estimated to be 270 lakh tonnes, Agriculture Minister Sharad Pawar said today the government was looking at ways to utilise or dispose of the surplus quantity. The country's annual sugar consumption is about 185 lakh tonnes.

The government would look at ways to utilise or dispose of the surplus stocks to keep its prices from falling.

The government was considering two or three alternatives to dispose of the sugar stock so that farmers were not discouraged, as the prices of the sweetener would fall in a situation when production overtook demand, he said.

Mr Pawar, however, agreed that it would not be easy to export the commodity given the competitive international market, where the sugar prices were very low.

But Mr Pawar also ruled out any export subsidy for sugar exporters to help them take on competition.

The Director-General of Foreign Trade yesterday notified the partial lifting of ban on sugar exports by allowing only advance licence holders to export the commodity.

On India's ethanol production, Mr Pawar said it was time India followed the Brazilian model where ethanol productionwas stepped up whenever petroleum prices were high. Conversely, when the petroleum prices are seen to dwindle, the country produced more sugar, he said.

New Delhi, January 5
While the country is planning to double the capacity of its proposed strategic crude oil reserves to 10 million tonnes, the Petroleum Ministry has demanded oil and gas exploration business and pipelines (E&P) be granted infrastructure status to encourage exploration in unexplored basins, entailing a 10-year tax holiday to companies.

"We will be in a position to complete 5 million tonnes storage in 36 months from April 1, 2007, contrary to the earlier planned 48 months," Petroleum Secretary M. S. Srinivasan said at the CII Distinguished Lecture Series here.

He said the private sector would be roped to help bring in the additional 5 million tonnes.

The government last year approved the setting up of a reserve worth 5 million tonnes, sufficient to meet 15 days’ demand. The reserves will be used as a hedge against volatility in international crude oil markets and meet domestic demand in case of short-term supply disruptions.

He said, “Only 31 per cent of India's sedimentary basins have been explored till date. We have set an ambitious target of reaching 60 per cent by the end of 11th Plan period (2012)."

Mr Srinivasan said India would not follow the Russian model of 'resource nationalisation' as confining oil and gas reserves to public sector can breed inefficiencies through sub-optimal utilisation of resources.

In most of the Gulf nations, state-run firms own and operate oil and gas fields. Russia, which had allowed global energy giants to look for oil and gas, too, has lately been 'seizing' control of its vast fuel reserves.

National oil companies globally breed inefficiencies (rather) we want more (private and foreign) investment and to open up the sector, he said.

He came down heavily on Indian public sector oil firms for not doing enough for the energy security of the country. 

Hong Kong/New Delhi, January 5
Hutchison Telecom said today the Indian partner’s consent for the sale of equity in mobile joint venture Hutch-Essar was needed only if it was to certain telecom players in India and not for any deal with others.

In the midst of reports of differences between the two partners on the issue of right of first refusal (RoFR), the comment by HTIL assumes significance and may impact aspiring Indian companies, including Anil Ambani Group firm Reliance Communications.

A spokesperson for HTIL, which holds majority 67 per cent stake in Hutch-Essar, said: “RoFR exists in the limited case of a sale to certain Indian telecom companies. There is no RoFR over any other buyer”. As per the shareholding agreement, the partners get a chance to buyout the other by matching the highest bid under the clause of RoFR.

However, the scope of RoFR is itself under dispute and Essar’s top officials had visited HTIL headquarters in Hong Kong earlier this week to resolve the issue.
The statement by HTIL coincides with the India visit of officials of UK telecom giant Vodafone, the first entity to make public its intention to acquire HEL.

Asked about the HTIL statement, an Essar spokesperson said: “We do not wish to comment on the shareholders’ agreement”. HTIL did not elaborate on RoFR and declined to comment on the discussions with the Essar Vice-Chairman Ravi Ruia on Wednesday, but the position taken by it may lead to a legal tangle and possibly delay the process of sale of the Hong Kong-based company's stake in HEL, sources said. — PTI

New Delhi, January 5
ONGC Videsh Ltd (OVL) will buy up to a 33 per cent stake in two Caspian sea blocks offshore of Turkmenistan for Rs 150-200 crore.

"We have concluded a deal with Denmark's Maersk Oil and German oil and gas firm Wintershall for taking up to a 33 per cent stake in Block 11 and 12 in offshore Turkmenistan," OVL Managing Director R.S. Butola said here late last evening.

Maersk Oil, with an 80 per cent holding, is the operator of the blocks, which cover about 5,663 sq km while Wintershall, a unit of the BASF chemicals group, owns the remaining 20 per cent stake.

Mr Butola said OVL was likely to sign a deal with Maersk Oil and Wintershall within a month.

"We are waiting for the Turkmenistan Government's approval. Once that is obtained we will sign a production-sharing contract," he said. — PTI

New Delhi, January 5
Trade Ministers of India and Mauritius today discussed the Comprehensive Economic Cooperation Partnership Agreement (CECPA) and means to end the deadlock at the WTO, while skirting the contentious Taxation Agreement.

“We discussed the CECPA and bilateral cooperation in trade and commerce. The issues concerning Double Taxation Avoidance Agreement (DTAA), however, did not figure in the talks,” Mauritian Minister of Foreign Affairs and International Trade Madan Murlidhar Dulloo said after a meeting with Commerce Minister Kamal Nath.

Both countries have formed an empowered team for negotiating the CECPA, following the recommendations of the joint study group. Many rounds of talks have already been held so far by the empowered team.

Mr Dulloo said as the issues on the DTAA were being taken care of by a technical group, it did not figure in the talks.

The discussion also focused on breaking the impasse in the Doha round of negotiations at the WTO.

“Apart from trade, we also discussed how to unlock the WTO impasse,” he added.
Trade ministers of key players at the WTO are likely to hold informal consultations at Davos by the end of this month to find a way forward for the Doha round, Mr Dulloo added.

Before the Davos meet, trade ministers of the African Union would hold discussions on multilateral trade talks. The key trading bloc African, Caribbean and Pacific (ACP), of which Mauritius is a member, would also meet to discuss the WTO.

Meetings of major developing countries in the run-up to talks at Davos are significant as their stand would determine, to a large extent, if the talks could be revived. — PTI

Mumbai, January 5
RBI Governor Y.V. Reddy said today the apex bank was comfortable with the levels of inflation and it could be in the region of 5 and 5.5 per cent through the current financial year.

“Inflation is by and large on expected lines and (economic) growth has been stronger. As of now we stick to the inflation range of 5.0-5.5 percent for end-March,” Mr Reddy said.

He added that the volatility in call money markets last week was due to a “rebalancing of portfolios” by some banks due to the increase in the cash reserve ratio (CRR).

“For a large number of large players it was a fairly non-disruptive adjustment in rebalancing, and so as you would have noticed the liquidity conditions are not the volatile element that was seen some time ago,” he said.

New Delhi, January 5
With a view to checking asset bubble in the booming realty stocks, the RBI has refused to grant FII status to foreign direct investment received through private placement of equity by real estate companies.

According to sources, the RBI has taken a view that no relaxation can be given for FDI brought in through private placement by companies, whose projects are not in compliance with the guidelines of Department of Industrial Policy and Promotion (DIPP).

Leading real estate players, which want to encash on the investors’ increasing appetite for realty sector stocks, have been seeking FII status for their pre-offer placement as many of their existing projects are not meeting tough FDI norms.

With RBI taking a tough stand, the DIPP has sought views of the Finance Ministry on the market sensitive subject. Contrary to reports, the government has no intention to relax FDI norms for the sector, senior officials said.

No realty firm can have FDI unless all its projects meet the guidelines. This is coming in the way of big players leveraging their existing projects for foreign investment, industry sources said.

The RBI has taken a view that private placement cannot be treated at par with the portfolio investment since the former involves discretion of the promoters of a company, the sources said.

The RBI has argued that the Foreign Exchange Management Act (FEMA) needs to be amended if FDI in real estate has to be given the status of portfolio investment.

Of late, the central bank has been tightening lending guidelines for the banks for the overheated real estate sector. — PTI

New York, January 5
US aviation giant Boeing Co has secured 1,044 net orders for new aircraft in 2006, regaining the top spot from European arch-rival Airbus.

The figure was up from 1,002 in 2005, and was dominated by an order for 82 Boeing 737s from low-cost US carrier Southwest Airlines.

Boeing also sold 157 of its new 787 “Dreamliner” long-haul jets last year, including 45 to Australia’s Qantas. Dreamliner, the fastest-selling new plane in history, is scheduled to enter into service in 2008.

Airbus, having been the best-selling aircraft maker since 2001, lagged Boeing throughout last year. According to its forecasts, the European company won around 800 net orders in 2006. — AFP

Kolkata, January 5
The Damodar Valley Corporation (DVC) and Coal India Ltd (CIL) have decided to form a joint venture for coal mining activities and procuring domestic and overseas coal blocks.

“Talks have concluded at the highest ministerial level for the JV. Now, the proposal will be placed before Board of the DVC and CIL,” DVC Chairman Asim Kumar Burman said.

“Besides keeping the option for coal blocks in India and overseas, the company may also take up activities for CIL’s unutilised underground coal blocks,” Mr Burman said, adding that financial and other finer details would be finalised after the Boards cleared the proposal. The DVC was keen on a majority stake in the venture.

The JV would facilitate assured coal supply to meet its expansion plans. The DVC is adding 1,000 MW by March this year and 7,000 MW during the 11th five-year Plan period.

The power utility’s coal requirement will rise from 11 million tonnes to 50 million tonnes by 2010 to fuel new capacity.

Currently, the DVC mines 4.8 lakh tonne of coal from its captive mine at Bermo in West Bengal. — PTI