New Delhi, April 4
In a major step towards moving to single GST (goods and service tax) by April 1, 2010, the finance ministry has decided to share revenue collections from 33 services to respective states with immediate effect, Parthasarthi Shome, adviser to finance minister P Chidambaram, disclosed here today.

The finance ministry would also identify yet another 44 services whose revenue collections would also be transferred to them after taxes on such services have begun, Shome said while inaugurating a conference on ‘GST for accelerated economic growth and competitiveness’, organised by Assocham here.

Dr Shome said a mission mode project called Tinexsystem is put in place by ministry of information technology to exchange information about states taxes to help them understand one another’s tax structure under supervision of the Revenue Department.

“With the system in place, it would be easier for states to comprehend other states tax structure and share information so that a single GST is executed as proposed by April 1, 2010 in a uniform manner,” he said.

The finance ministry has decided to devise a practical mode of unified GST tax structure, based on prevalent GST model that exists in countries like Canada, Brazil and European Union to suit the requirement of Indian taxpayers.

He said that revenues collected from 33 services by the central government from service tax imposition would be proportionately transferred to respective states and when tax collection starts from another 44 services, the finance ministry would transfer it to all states and UTs.

Dr Shome said under the GST, the Centre’s dominance would continue as far as levy of taxes on manufacturing and manufacturing process were concerned, but states would be empowered to suggest taxation beyond manufacturing to retailing.

Commenting on Assocham’s roadmap on GST, Dr Shome concurred that with GST in place, the government revenues could go up to the extent of 5 lakh crore per annum without putting trade and commerce to any inconvenience. 

Mumbai, April 4
In order to expand operations in the South America region, IT major Satyam Computer Services has opened a multi-lingual development centre, named ‘Satyam Latam Center’ in Sao Paulo.

“In addition to enable Satyam to respond to our clients needs with more agility, the new centre will serve as the organisation’s South American headquarters,” leader of Satyam’s initiatives in the Americas Gary Teelucksingh said.

The development centre marks the first of the several key investments Satyam is making on this continent. In fact, plans for another substantial centre in Brazil are already under way, he added.

The Satyam Latam Center is already providing services for several Brazilian, South American and global customers.

“Sao Paulo has a great number of skilled and highly capable information technology and business professionals who would benefit the company and our clients,” Ram Mynampati, president of Satyam’s commercial and health care businesses said. — PTI 

Mumbai, April 4
US-based paints and coating maker Sherwin-Williams Co has entered the Indian market, by acquiring full ownership of Nitco Paints Pvt. Ltd., which mainly serves western India.

The acquisition, made for an undisclosed amount, would be followed by investment by the American firm in privately owned Nitco’s manufacturing and distribution infrastructure, Conway Ivy, Sherwin-Williams senior vice-president, told reporters. “We need to understand the Indian market better. We will explore what products and technology we need to bring in,” he said.

Sherwin-Williams, Ivy said, had drafted an aggressive growth strategy in India. “We are interested in acquisitions in India and will be talking to other companies,” he said. Nitco Paints, which makes exterior paints, reported sales of Rs 800 million in 2006/07, up 25 per cent from a year ago. Ivy said Nitco, under the US firm, would initially focus on the decoratives paint segment, but would later broaden the product line.

Indian paint companies have been growing at an average of 15 per cent annually, spurred by strong housing and construction demand in a growing economy. The decoratives segment is dominated by Asian Paints, India’s top paints maker. “The large growing middle class will drive the paint market to high quality products, which basically fits with our range of products,” Ivy said. — Reuters

New Delhi, April 4
The Cement Manufacturers Association (CMA) today hit at government's decision to abolish all customs duties on the construction material, saying this tantamount to "incentivising of imports".

"Cement prices in India have gone up only because of change in excise structure and not for any other reasons...If government wants the prices to come down, it should simply abolish excise duty the same way as it did in case of import duties and provide level-playing field to domestic industry," CMA president Manoj Gaur said.

Every one million tonne of cement capacity provides direct job employment to 5,000 persons and indirect employment to 25,000, he said, wondering as to why the government should discriminate against the domestic industry.

The finance ministry had yesterday abolished 16 per cent countervailing duty and 4 per cent special additional duty on cement (except white cement) to make imports of the construction material duty free. The government had earlier abolished basic customs duty of 12.5 per cent in January.

The cement industry said the move would not make imported cement cheaper than being offered by domestic manufacturers.

The abolition of import duties would make imports of cement cheaper by around Rs 22-23 a bag, but it would still be higher than the domestic product, J K Cement CFO A K Saraogi said, pointing to limited scope of the government's move.

CMA vice-president H M Bangur also said foreign exporters could not compete with Indian cement companies. — PTI

New Delhi, April 4
Most celebrities mellow and fade with age but Indian cricketers never seem to be falling out of favour with corporates, who have bet between Rs 250- 300 crore on old warhorses, Sachin Tendulkar, Rahul Dravid and Sourav Ganguly, for . advertising campaigns.

Though the trio may not make it to the next world cup, admakers feel that their faltering performance would not hurt long term endorsements.

“It will be a very immediate reaction to say a brand like Tendulkar has eroded. If a brand like him was event specific and if one bad performance was to erode his value, then entire concept of celebrity endorsements will be fallacious,” Canon India vice-president Alok Bharadwaj told PTI.

Earlier this year, Canon had signed a three-year contract with Tendulkar, who is reported to command an estimated Rs 6-7 crore annual fee per endorsement and has about a dozen such contracts with various brands.

“We’ve shared a healthy relationship with him (Tendulkar) and see ourselves continuing to do so in future,” PepsiCo India executive vice president (marketing) Vipul Prakash said.

However, with veterans such as Ian Chappell calling for his retirement, many in the industry believe Tendulkar’s stock has gone down and it would be difficult for him to command the same fees.

“His performance has taken a beating and definitely this will be reflected in his endorsements,” Percept D'Mark CEO Preeta Singh said.

This is strongly contested by his manager, Saatchi & Saatchi, whose arm Iconix looks after Tendulkar’s business.

Dravid, who is reported to command an annual fee between Rs 1.5 crore to 2 crore, is on a much more comfortable wicket.

“We are solidly behind him,” Bank of Baroda chairman Anil K Khandelwal said, adding that the bank would retain him.

“Dravid continues to be our brand ambassador and we are proud to have him,” he said, adding that one unsuccessful experience would not write off Dravid.

The bank had signed a multi-crore three year contract with Dravid in 2005 when it went for an image makeover.

As for Ganguly, his comeback performance onfield has had a similar effect off the field, with his fee returning into the crore league. — PTI 

New Delhi, April 4
Indian companies made foreign direct investment (FDI), worth $23 billion in January and February, 2007, which far exceeds the investments of $21 billion made during the 12 months of 2006.

This was revealed by Department of Industrial Policy Secretary Ajay Dua while speaking at the national conclave organised by Confederation of Indian Industry (CII) here today.

Highlighting the importance of mergers and acquisitions for the small and medium enterprises (SMEs), Dua said: “SMEs are increasingly acquiring companies to gain the advantages of quick scale up, technology acquisition and benefits of innovation.”

“Moreover, a large number of SMEs overseas already have FDI approvals, thus making the process of acquisitions faster,” Dua added.

The secretary further said that the size of company was no longer valid in relation to mergers and acquisitions.

CII’s past president Sunil Kant Munjal said that there is an increasing war in business for talent acquisition, funds, market share, technology and innovation.

“M&As are one route to win this war… M&As are a phenomenon that are here to stay and we can only take advantage of it if we are smart”, he said.

Various issues related to making M&As successful in India were discussed at the day long conclave.

Dr. Sarita Nagpal, Head, Manufacturing Services Division, CII, said: “M&A’s have acquired a strategic importance for India’s manufacturing sector across size and industry. According to a recent CII NMCC survey, 42 per cent of the respondents consider M&A’s as an outside factor impacting their businesses overtaking technology”.

New Delhi, April 4
The empowered group of ministers (eGoM) is likely to lift the freeze on special economic zones (SEZs) at a meeting tomorrow and clear proposals where developers have received all approvals, but may put a cap on the size and number of SEZs in the country.

"The eGoM will meet tomorrow and its first call will be to decide on the 82 cases where all formalities have been completed and are awaiting notification," official sources said here.

Of the 234 SEZ proposals with formal clearance, only 63 have been notified. Of the remaining, 82 have applied for notification after completing all formalities.

The meeting of the eGoM follows a clearance from the Congress party last week on SEZs, which were facing uncertainty after violent protests over land acquisition at Nandigram in West Bengal and uproar in other states.

The party gave the clearance after pressure mounted from the commerce ministry and also from UPA partners, including DMK in Tamil Nadu and some other state governments.

Sources said the relief is coming only for those SEZs which have land. The fate of those without land will be decided only after the Centre comes out with a comprehensive relief and rehabilitation policy.

Apart from clearing the zones that have completed all formalities, the eGoM may put a cap on the maximum size as demanded by a key supporter of the government - CPM. It could also look at putting sector specific limits on number of SEZs.— PTI