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THE TRIBUNE SPECIALS
50 YEARS OF INDEPENDENCE

TERCENTENARY CELEBRATIONS

B U S I N E S S

PMO takes industry ministry to task
FDI retail issue

New Delhi, February 23
Prime Minister Manmohan Singh’s office has pulled up the Industry Ministry for not responding to concerns raised by Congress President Sonia Gandhi over investment by multinational firms in the retail sector and asked for a detailed study on the subject.

  • Pact with Wal-Mart soon: Sunil Mittal

Pawar backs Bharti, Wal-Mart tie-up
New Delhi, February 23
US retail giant Wal-Mart's tie-up with the Bharti Group for a retail venture today received a boost with the government endorsing the contract farming route.
Bharti Enterprises CMD Sunil Bharti Mittal (second from left) and Wal-Mart vice-chairman Mike Duke (left) at a meeting with agricultural minister Sharad Pawar in New Delhi on Friday.
Bharti Enterprises CMD Sunil Bharti Mittal (second from left) and Wal-Mart vice-chairman Mike Duke (left) at a meeting with agricultural minister Sharad Pawar in New Delhi on Friday. — AFP











 
An employee of Canon displays digital camera, EOS 1D Mark III at a press preview in Tokyo on Thursday. Canon, marking its 70th anniversay this year, will release the EOS 1D Mark III in May this year at a price of $4,130.
An employee of Canon displays digital camera, EOS 1D Mark III at a press preview in Tokyo on Thursday. Canon, marking its 70th anniversay this year, will release the EOS 1D Mark III in May this year at a price of $4,130. — AFP

ICICI Bank ups lending, deposit rates
Mumbai, February 23
ICICI Bank said today it had raised lending and deposit rates for new retail customers by 50 basis points to help maintain its net interest margins. The deposit rates have also been increased in the range of 50 bps-75 bps across various tenures.

Deflate inflation: Kalam
New Delhi, February 23
The government should rein in inflation if the economic growth of 9 per cent is to benefit millions of poor. This was stated by the President A.P.J. Abdul Kalam in his address to a joint-sitting of the two Houses of Parliament, marking the opening of the Budget Session.
British violinist Ruth Palmer holds a Stradivari violin at Christie's auction rooms in central London on Friday. The 1729-made violin will be auctioned in April and is expected to sell for up to $1.5 million
British violinist Ruth Palmer holds a Stradivari violin at Christie's auction rooms in central London on Friday. The 1729-made violin will be auctioned in April and is expected to sell for up to $1.5 million — Reuters

India, Pak agree to share gas, differ on pricing
Islamabad, February 23
India and Pakistan moved a step closer to build the $ 7 billion Iran-Pakistan-India gas pipeline as the two countries reached an understanding to share natural gas to be imported from Iran, but they failed to arrive at a consensus on transportation costs and transit fee.

Ban on Karvy goes
Mumbai, February 23
SEBI has lifted the ban on undertaking fresh business by Karvy Computershares for its alleged involvement in the IPO scam.

US beer major eyes India
Houston, February 23
Anheuser-Busch International Inc. has entered into a joint venture with Crown Beers India Ltd in a move that will give the US' largest brewer entry into the Indian beer market.

Industry wants more funds for
infrastructure

Chandigarh, February 23
Widening of tax base, more fiscal concessions and more allocation for infrastructure development is the wish list of industry in north India from the budget 2007-08.

MS ordered to pay Alcatel-Lucent $1.5 b 
San Francisco, February 23
A US jury has found Microsoft guilty of infringing Alcatel-Lucent patents and ordered the software giant to pay the French-US firm $1.5 billion.

Arcelor Mittal to invest $2.2 b in Senegal mine
Brussels, February 23
Arcelor Mittal, the world's largest steelmaker, said today it would invest $2.2 billion to develop iron ore mining in Senegal, pursuing its strategy of increasing the share of metal supply it directly owns.

SBoP revises rates
Chandigarh, February 23
The State Bank of Patiala has revises interest rates upward, under platinum deposit scheme from today. The interest rate for a deposit of three years has been raised from 9 per cent per annum to 9.50 per cent per annum for general public and from 9.25 per cent to 9.75 per cent for senior citizens. — TNS

NBFCs with assets above Rs 100 cr  to file returns
Mumbai, February 23
The RBI today directed all non-banking finance companies and residuary NBCs with total assets of Rs 100 crore to submit returns in a decided format on a monthly basis.

Doha talks: ‘Convergence of mindset’ needed
New Delhi, February 23
Justifying developing countries’ stand to protect the interests of farmers and infant industries, commerce minister Kamal Nath today asserted that "convergence of mindset" is essential for resumption and successful conclusion of the suspended Doha development round of the WTO.

 

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PMO takes industry ministry to task
FDI retail issue
Tribune News Service & PTI

New Delhi, February 23
Prime Minister Manmohan Singh’s office has pulled up the Industry Ministry for not responding to concerns raised by Congress President Sonia Gandhi over investment by multinational firms in the retail sector and asked for a detailed study on the subject.

Days before the visit of Wal-Mart officials to India for discussing their venture with Bharti group, the PMO sent a missive to the Department of Industrial Policy and Promotion, headed by Kamal Nath, saying that “the Prime Minister has observed that the AICC President had raised a specific issue in her letter.” She had referred to the need for a ‘careful study’ of the likely impact of the entry into retail trade of transnational supermarkets on the livelihood of small-scale retailers and vendors.

“The DIPP has not responded to this issue in its comments (sent to the PMO on February 7, 2007),” the letter said.

When asked about the communication, the PMO declined to comment on the issue.

Sonia Gandhi had written a letter to the Prime Minister last month, expressing her concerns over FDI in retail as also the impact of big domestic players on small neighbourhood stores.

 

Pact with Wal-Mart soon: Sunil Mittal

Wal-Mart, the world's largest retailer, and Bharti Enterprises are very close to finalising a deal for a retail joint venture, Bharti Enterprises chairman Sunil Bharti Mittal said here today.

Talking to reporters here after meeting Planning Commission Deputy Chairman Montek Singh Ahluwalia, along with visiting Wal-Mart Vice-Chairman Mike Duke, he said a joint venture agreement with Wal-Mart for cash-and-carry and back-end linkages had been finalised and legal agreements were being worked out.

Bharti retail would not get a preferential treatment from the JV as it would supply to the kirana stores also, he said when asked if the agreement with Wal-Mart was exclusive.

On whether Wal-Mart saw any hurdles in the backdrop of Congress President Sonia Gandhi’s letter to the Prime Minister advising caution in allowing entry to the US retailer into India, Mittal said: “Wal-Mart is going to apply for a JV, only in the area where the policy exists.”

The entry of Wal-Mart, whose revenue of about $320 billion is bigger than the size of India’s retail market ($300 billion ), is viewed by some as a threat to the about 13 million mom and pop stores in the country.

But the US retailer would be investing only in cash-and- carry business, where 100 per cent FDI is already allowed.

Asked about Wal-Mart describing the talks with Bharti as preliminary, Mittal said it was only for technology transfer.

Wal-Mart had said that in line with existing guidelines, Bharti Retail had approached it for technology support in logistics, supply chain and back-end technology.

Seeking to allay fears its entry in India would wipe out neighbourhood stores, a Wal-Mart spokesperson said: a cash-and-carry wholesale operation has the potential to provide much needed support to small business owners and retailers by selling them quality merchandise at competitive prices.

Mittal said the company had not yet decided on branding of the venture and that market studies were on for the purpose.

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Pawar backs Bharti, Wal-Mart tie-up

New Delhi, February 23
US retail giant Wal-Mart's tie-up with the Bharti Group for a retail venture today received a boost with the government endorsing the contract farming route for procurement of farm products.

"The expertise of Wal-Mart in the area of supply chain will definitely be useful for Bharti to set up their own network," agriculture, food and consumer affairs minister Sharad Pawar said after a meeting with Wal-Mart vice-chairman Mike Duke and the Mittal brothers from Bharti.

Pawar said, on the face of it, it looked like that under the contract with Bharti, farmers would be able to sell their produce at a better remunerative price.

In reply to a query, he made it clear that differences among political parties were limited to permitting foreign direct investment in the retail sector and not in outsourcing of agricultural produce.

"The route of contract farming will be definitely beneficial for farmers and producers because they will be able to realise a good price for their produce. From Bharti side they will be comfortable as they can get the items they have signed under the agreement for their organisation," he said.

In fact, one of the major problems that farmers were facing is lack of effective marketing and remunerative price.

"From this angle, efforts which Bharti group is making is certainly useful for India's farming community," he said. — PTI 

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ICICI Bank ups lending, deposit rates

Mumbai, February 23
ICICI Bank said today it had raised lending and deposit rates for new retail customers by 50 basis points to help maintain its net interest margins. The deposit rates have also been increased in the range of 50 bps-75 bps across various tenures.

There is no change in lending rates for corporates and the new rates would be applicable only to new customers, Executive Director V. Vaidyanathan said.

"We had already prepared the market for a raise," he told Reuters. "We worked on it in the past few days and have decided to raise the PLR by 50 basis points."

He expected the increase to help maintain the bank's net interest margin, which was 2.6 per cent for the December quarter.

Mr Vaidyanathan said a series of rate increases and tightening measures by the central bank were having an impact on loans demand. The annual loan growth could slow to about 20 per cent from the current rates around 30 per cent.

The interest rate on new variable-rate home loans would be 11 per cent, up from 10.5 per cent, and fixed-rate home loans would rise to 13 per cent from 12.5 per cent.

Leading bank SBIon Monday raised its benchmark lending rate by 75 basis points to 12.25 per cent. — Reuters

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Deflate inflation: Kalam
R. Suryamurthy
Tribune News Service

New Delhi, February 23
The government should rein in inflation if the economic growth of 9 per cent is to benefit millions of poor. This was stated by the President A.P.J. Abdul Kalam in his address to a joint-sitting of the two Houses of Parliament, marking the opening of the Budget Session.

In his hour-long speech, Kalam outlined the priorities of the UPA government, ranging from checking inflation to food security, sustaining GDP growth to welfare of minorities, convincing Pakistan to stop infiltration to cross-border terrorism, modernisation of armed forces to indigenous three stage nuclear programme and revitalising higher education.

Data released, after he had spoken, showed that inflation was marginally down to 6.63 % for the week ending February 10. It was only slightly lower than the previous week's rate of 6.73 %, which was the highest in the past two years.

Kalam, who was making his last speech to Parliament before demitting office at the end of a five-year tenure in July, referred to inflation right at the beginning of his address to underscore the government's concern.

He listed out initiatives by the government, particularly in the past eight weeks, to improve supplies of essential commodities as also fiscal policy steps to check inflation.

However, in recent months, the rate of inflation had shown an upward trend, Kalam observed, adding that as growth and investment accelerated rapidly and incomes rose, "there is bound to be a rising demand for all products, particularly products of day-to-day consumption".

He said: “My government is committed to providing food security to the poor and is taking steps to further strengthen the public distribution system.”

Kalam indicated that the action on the much-debated report of the Sachar Committee on the backwardness of Muslims was in the offing.

He announced that the government was considering the formulation of a programme for those districts and towns that have highest concentration of minority population.

Referring to the recent controversies over land acquisition for industrial development, Kalam said the government was committed to bring in a new rehabilitation policy to be backed by the required amendments in the Land Acquisition Act.

Lauding six per cent growth in the agrarian sector in 2005-2006, Kalam stressed the need for sustaining the trend but expressed concern over farmers committing suicides in various parts of the country.

"A special package amounting to more than Rs 16,000 crore is being implemented in 31 districts worst-affected by farmers suicides... An expert group is looking into the problems of agricultural indebtedness and will suggest measures to provide relief to farmers in distress," he said.

On internal security, he said the government would continue to impart a "healing touch" both in Jammu and Kashmir and in the North-East, while maintaining utmost vigil against terrorist and extremist forces.

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India, Pak agree to share gas, differ on pricing

Islamabad, February 23
India and Pakistan moved a step closer to build the $ 7 billion Iran-Pakistan-India gas pipeline as the two countries reached an understanding to share natural gas to be imported from Iran, but they failed to arrive at a consensus on transportation costs and transit fee.

Addressing a joint press conference after the end of the two-day official-level talks, Pakistan’s petroleum secretary Ahmad Waqar said the two countries have agreed to receive 60 million standard cubic meters of gas per day (mmscmd) and share 30 mmscmd each in the first phase.

The remaining volumes would be shared in the next phase of the project. The understanding was reached at a bilateral meeting attended by petroleum officials of India and Pakistan while Iran attended it as an observer.

He said Pakistan has also agreed in-principle to the formulation of transportation costs involved in bringing the gas from Iran-Pakistan border to Pakistan-India border. “We agreed with India (on the formulation). However, final tariff will be based on actual technical and financial inputs. — PTI

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Ban on Karvy goes

Mumbai, February 23
SEBI has lifted the ban on undertaking fresh business by Karvy Computershares for its alleged involvement in the IPO scam.

SEBI, however, made it clear that the lifting of the ban was an interim measure pending final disposal of the case by its enquiry officer.

In its interim order on the IPO scam issued in April last year, SEBI had directed Karvy Computershares not to act as a registrar to an issue and as a share transfer agent.

The SEBI order said that Karvy Computershares in its capacity as registrar to an issue had allegedly facilitated the key operators and financiers in cornering shares in IPOs. SEBI made it clear that today's order would, however, not come in the way of continuation of proceedings against Karvy Computershares.

Karvy Computershares is a part of the Karvy Group. Both Karvy Stock Broking Private Limited and Karvy Computershares have filed appeals challenging the SEBI's interim order. — PTI

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US beer major eyes India

Houston, February 23
Anheuser-Busch International Inc. has entered into a joint venture with Crown Beers India Ltd in a move that will give the US' largest brewer entry into the Indian beer market.

The 50-50 joint venture will operate under the name Crown Beers India Ltd. and includes a new state-of-the-art 500,000-hectolitre brewery in Hyderabad which will be completed in March this year.

"International expansion is a key part of Anheuser-Busch's growth strategy, and while India is a small beer market today, it is growing rapidly and has tremendous long-term potential," August A. Busch IV, president and chief executive officer of Anheuser-Busch Cos. Inc, said. — PTI

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Industry wants more funds for infrastructure
Ruchika M. Khanna
Tribune News Service

Chandigarh, February 23
Widening of tax base, more fiscal concessions and more allocation for infrastructure development is the wish list of industry in north India from the budget 2007-08.

While the industry is ecstatic over the economic growth shown by all sectors during this fiscal, it is looking towards the finance minister P Chidambaram to remove all bottlenecks in accelerating further growth. Maintaining that the economy is on a sound development track, the doyens of industry in the region want the finance minister to provide more allocation for infrastructure development and for the farm sector.

Talking to TNS here today, CEO of Liberty Group and chairman of CII, northern region, Adesh Gupta said the industry was looking forward initiatives in building infrastructure like airports, better road connectivity and improvement in power generation and supply. “Since the manufacturing sector has shown a high growth rate (11. 3 per cent), we expect the government to select this sector for employment generation, especially in tourism, apparel, footwear and auto industry. Though we do not foresee a large scale reduction in taxation, we expect widening of tax structure to include service sector,” he said.

Mr Manmohan Nandwani, COO, Spice Telecom, said the Indian mobile industry was a major contributor to social and economic growth of the country, in terms of employment generation, GDP growth and rural development. “Thus it is important that the burden of levies on the telecom sector be lowered and simplified to ensure maximum growth in this sector by making mobile telephony more affordable,” he said, adding that the present structure of multiple levies on the sector should be removed.

The rising inflation is also a cause of concern and the industry expects fiscal concessions to curb inflation. Said general manager, PNB, north zone, “The government should concentrate on the agriculture sector as well as small and medium enterprises (SME). The cluster approach in the SME sector, like development of food parks, agriculture equipment cluster, or auto cluster et al, should be encouraged’’.

The agriculture sector, too, is looking forward to the budget so that it gets a fillip. With growth in this sector at an all-time low of 2.7 per cent, farmers like R.S. Chauhan, a leading horticulturist of Kotgarh in Himachal Pradesh wants the government to strengthen research and development in agriculture to increase the crop yield and for getting high value crops. 

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MS ordered to pay Alcatel-Lucent $1.5 b 

San Francisco, February 23
A US jury has found Microsoft guilty of infringing Alcatel-Lucent patents and ordered the software giant to pay the French-US firm $1.5 billion.

"We think this verdict is completely unsupported by the law or the facts," Microsoft general counsel Tom Burt said yesterday. "We will seek relief from the trial court, and if necessary appeal." Before it merged with Alcatel, Lucent filed a US federal lawsuit in 2003 claiming Microsoft partners, including computer makers Dell and Gateway, used Windows software that infringed its patented technology.

The jury trial that ended in US District Court in the southern California city of San Diego yesterday centered on MP3 audio technology used in the Windows media player software. — AFP

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Arcelor Mittal to invest $2.2 b in Senegal mine

Brussels, February 23
Arcelor Mittal, the world's largest steelmaker, said today it would invest $2.2 billion to develop iron ore mining in Senegal, pursuing its strategy of increasing the share of metal supply it directly owns.

''Once completed, the Faleme project will prove to be an important and competitive source of iron ore supplies for our European plants,'' Arcelor Mittal majority owner and Chief Executive Lakshmi Mittal said.

The steel giant said it aimed to achieve annual production capacity of between 15 million and 25 million tonnes and that total estimated reserves were approximately 750 million tonnes.— Reuters

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SBoP revises rates

Chandigarh, February 23
The State Bank of Patiala has revises interest rates upward, under platinum deposit scheme from today. The interest rate for a deposit of three years has been raised from 9 per cent per annum to 9.50 per cent per annum for general public and from 9.25 per cent to 9.75 per cent for senior citizens. — TNS

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NBFCs with assets above Rs 100 cr  to file returns

Mumbai, February 23
The RBI today directed all non-banking finance companies and residuary NBCs with total assets of Rs 100 crore to submit returns in a decided format on a monthly basis.

The first such return may be submitted for the month ending April 30, 2007, the RBI said while issuing prudential norms directions for deposit and non-deposit taking NBFCs and RNBCs.

For operational convenience, the RBI has issued two sets of prudential norms directions.— PTI

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Doha talks: ‘Convergence of mindset’ needed
Tribune News Service

New Delhi, February 23
Justifying developing countries’ stand to protect the interests of farmers and infant industries, commerce minister Kamal Nath today asserted that "convergence of mindset" is essential for resumption and successful conclusion of the suspended Doha development round of the WTO.

"If protecting the livelihood and security of our farmers is protectionism, then I am a protectionist," the commerce minister said accusing the developed countries, especially the US of trying trade subsidies.

"In fact, I would say that the Doha development round was not really about protecting the farmers or infant industries in the developing world, but correcting the structural flaws at WTO," Nath said releasing the "World Trade and Development Report 2007", brought out by Research and Information System (RIS) for developing countries in association with Oxford University Press, here.

"The current impasse in the global trade talks under the aegis of the WTO offers an opportunity to reflect and resolve the broader issues about the processes of agenda-setting and decision-making in multilateral trade talks so as to make them inclusive and democratic," said the report in its recommendations.

In its 130-page comprehensive analysis of the state of play in WTO and workable suggestions for reactivating the stalled dialogue to bring development focus onto the centrestage of the agenda, RIS pitched for south-south cooperation (SSC) in trade.

It said in the Doha Round, developing countries have reinforced their participation through issue-based coalitions such as the G-20 and G-33 as well as the G-90.

It said that while a rule-based multilateral trading system is important for the developing world, the existing structure and process of rule-making suffers from asymmetries that need to be addressed. 

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BRIEFLY

Ranbaxy loses suit
Tokyo, February 23
Japan's Astellas Pharma Inc. said today that it had won a suit against Ranbaxy Laboratories Ltd to prevent the Indian drug-maker from releasing an early generic version of its Flomax prostate drug. Astellas, Japan's third-largest drug-maker and Germany's Boehringer Ingelheim, which jointly market the drug in the US, had filed the suit at the U.S. District Court of New Jersey. The US patent on Flomax, used to treat enlarged prostates, expires in October, 2009. — Reuters

Bombay Rayon
New Delhi, February 23
Bombay Rayon Fashions Ltd today acquired a 70 per cent stake in Birmingham-based DPJ Clothing Ltd for £1.54 million. DPJ Clothing is engaged in the business of wholesale marketing and distribution of clothing products. With the acquisition of 420 ordinary shares of DPJ Clothing, Bombay Rayon has became a foreign subsidiary of the company.-UNI

PFC debut
Mumbai, February 23
The Power Finance Corporation (PFC) was today for the first time trading at Rs 107.15 on the NSE, a premium of 26 per cent, over the IPO price of Rs 85, brokers said. The stock debuted at Rs 113, hit a low of Rs 106 and a high of Rs 119.40. — UNI

Ceat plan
Mumbai, February 23
RPG Group company Ceat will invest Rs 600 crore to set up a new radial tyre plant, chairman Harsh Goenka said here today.

The company is likely to decide on the location of the plant within the next two-three months, he said. — PTI 

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