Dehra Dun/New Delhi, June 4
Brazilian oil major Petrobras is set to enter India following the signing of swap agreement with Oil and Natural Gas Corp (ONGC).

Oil and Natural Gas Corporation Ltd (ONGC), and the Brazilian oil major Petrobras reached an agreement on swapping of interests in offshore blocks in India and Brazil allowing entry of Petrobras into India and an increased presence of ONGC Videsh Limited's (OVL) presence in Brazil.

ONGC has offered the Brazilian oil firm Petroleo Brasileiro SA a stake in its east coast blocks in exchange for getting a 15 per cent stake in a Brazilian exploration acerage.

The swapping agreement signed between the two oil companies today "marks an increased presence of ONGC Videsh Ltd (the overseas arm of ONGC) in Brazil and the entry of Petrobras in India," an ONGC press note said here.

Although the note mentioned the 'swap' arrangement, it did not say which blocks ONGC was offering to Petobras.

The agreement was signed today by chairman, ONGC group of companies R.S. Sharma, CEO of ONGC Videsh Ltd. (OVL) R.S. Butola and president and CEO of Petrobras Jose Sergio Gabrielli De Azevedo in the presence of Prime Minister Dr Manmohan Singh and the visiting Brazilian President Luiz Inácio Lula da Silva at the Hyderabad House in New Delhi.

Jose Sergio Gabrielli De Azevedo, President and CEO of Petrobras said: "India was always a strategic country for us. The deal emphasises the strength of our relationship with ONGC and our belief in the Indian story."

CEO of OVL R.S.Butola said: "Brazil is an important element of our global growth strategy. We believe that an increased interest in the area is attractive and re-confirms our commitment to growth in Brazil."

Petrobras, according to the note, had in April last year "accommodated OVL by waiving its right of pre-emption in the (Brazilian) offshore block BC-10" where the Indian firm acquired 15 per cent interest from Shell.

Shell has 50 per cent stake in the block located about 120 km south-east of the city of Vitria, Esprito Santo state, in water depths ranging from 1,500-2,000 meters. Petrobras has the remaining 35 per cent.

The agreement was the culmination of the MoU signed with Petrobras in September 2006 in Brasilia.

Earlier, Petrobras had accommodated OVL by waiving its right of pre-emption in the offshore block BC-10 in favor of OVL and a 15 per cent interest in the block was transferred to OVL. Thereafter, the companies had entered into a MoU to jointly participate in the oil and gas exploration in Brazil, India and third countries. Today's agreement is a first step towards the strategic partnership.

It is expected the agreement would help broaden the ONGC's portfolio in Latin America in partnership with Petrobras, one of the most renowned companies in deepwater operations. Similarly, utilization of its expertise in Deepwaters would help develop offshore blocks in India.

Meanwhile, Murli Deora, Minister for Petroleum & Natural Gas called on the President, Brazil, Luiz Nacio Lula Da Silva and discussed the potential for collaboration and cooperation between India and Brazil as both are growing economies and the international economic interests of the two nations are similar.

Expressing satisfaction with the present level of collaboration between India and Brazil in the energy sector, Deora indicated that the Indian navratna national oil companies like ONGC, IOC, BPCL and GAIL are further interested in E&P in Brazil.

Deora informed the President that on the Brazilian example, India has also started mixing of ethanol with petrol. Presently 5 per cent ethanol blended petrol (EBP) programme has been launched in major parts of India.

The minister requested that India would like to collaborate with Brazil on EBP for better technology to gain from the experience and expertise of Brazil.

Earlier, Brazilian President addressing India Inc said “India - Brazil trade relation has the potential of achieving the target of $10 billion by 2010 and can also go beyond the target.”

Lula da Silva said both the countries should diversify their trade potential and the significant business delegation is already following Indian example of economic growth.

He said Brazil and India had created G20, which makes both the countries important in the WTO negotiations and fulfilling Doha Round successfully. The interest of the developing countries and the farmers’ dependent solely on the agriculture are the priorities of the discussion in WTO, President Lula said.

New Delhi, June 4
In a much needed relief to senior citizens, the government today enhanced the threshold limit for exemption from deduction of tax at source from Rs 5,000 to Rs 10,000 on interest on any deposit under the Senior Citizens Savings Scheme, 2004.

The enhanced threshold limit of Rs 10,000 has come into force from June 1, 2007, as per notification SO No. 861(E), an official press note said here today.

This notification has been issued pursuant to an amendment made to Section 194A of the Income-tax Act, 1961 by the Finance Act, 2007.

By virtue of this notification, no tax will be required to be deducted at source under the Section 194A of the Income tax Act on interest credited or paid or likely to be credited or paid on any deposit made under the Senior Citizens Savings Scheme, 2004, where such interest does not exceed Rs 10,000 during the financial year.

The move is expected to benefit many senior citizens, who have made deposits under the said scheme. The enhanced limit of Rs 10,000 is also applicable with effect from June 1, 2007, to payments of interest by banking companies and co-operative societies engaged in the business of banking, it added.

New Delhi, June 4
India and Brazil today signed seven agreements and MoUs to boost trade and bilateral relations following talks between Prime Minister Manmohan Singh and visiting Brazilian President Luiz Inacio Lula Da Silva.

The agreements cover diverse fields like space, oil and education. An agreement for implementing arrangement regarding cooperation in augmentation of Brazilian earth station for receiving and processing data from Indian remote sensing satellites. The agreement was signed between space secretary G Madhavan Nair and Brazilian minister for external relations Celso Amorim.

An MoU on India-Brazil CEOs forum was signed by Ratan Tata, co-chairman from the Indian side and Jose Sergio Gabrielli, CEO of Petrobras and Brazilian co-chair.

Other agreements/MoUs signed pertained to audi-visual co-production, mutual assistance in customs matters, academic exchange programme and cooperation in applied economic research.

Brazil has emerged as India’s largest trading partner in Latin America with bilateral trade crossing the record $2 billion mark in 2006, commerce and industry minister Kamal Nath said here today.

Addressing a business seminar on India and Brazil, organised by the Confederation of Indian Industry (CII), the minister indicated that both governments have set a bilateral trade target of $10 billion by 2010.

Two-way trade between India and Brazil has registered a quantum increase - from a meagre $488 million in 2000 to $2.4 billion in 2006.

The inaugural session of the seminar was also addressed by Miguel Joao Jorge Filho, Brazilian minister for development industry and foreign trade.

Referring to the partnership between India and Mercosur, of which Brazil is a part, Nath informed that following the conclusion of a Preferential Trade Agreement (PTA) in March 2005, India and Mercosur have agreed to give tariff concessions, ranging from 10 per cent to 100 per cent to the other side on 450 and 452 tariff lines respectively.

The PTA will come into force as soon as ratified by the legislatures of Brazil and Argentina.

A trilateral arrangement between India, Mercosur and SACU (South Africa Customs Union) is also on the way to widen the scope of south-south cooperation, he added.

“Indian investments in Brazil have also increased in recent years, particularly in the field of information technology, biotechnology and pharmaceuticals. Indian companies such as Tata Consultancy Services, Ranbaxy, Dr Reddy’s Laboratories and Strides, among others, have made a mark in the Brazilian market,” the minister said.

He also had a separate interaction with Brazilian business delegation led by Armando Monteiro Neto, president of the National Confederation of Industry and member of the Chamber of Deputies, lower house of the Brazilian Parliament. 

Geneva, June 4
India blocked a World Trade Organisation (WTO) investigation of its import duties on American wine and spirits today, temporarily delaying a US government complaint over allegations that Indian rules discriminate against products such as Napa Valley wine and Jack Daniel’s whiskey.

The Geneva-based trade referee is already reviewing a European legal challenge of wine and liquor restrictions in a number of Indian states. A second investigative panel, examining Washington’s arguments, will almost certainly be established at a meeting later this month at the WTO’s dispute settlement body.

“The layers of customs duties India applies to the US products, wine and distilled spirits in particular, are not in line with its WTO commitments,” US trade representative Susan Schwab said last month, while announcing plans to seek litigation. “We must ensure a level playing field for US products around the world.” India’s basic import duties on wine are 100 per cent, while the tariff on spirits is 150 per cent, both within WTO limits.

However, various government surcharges take the tariffs up to levels reaching as high as 550 per cent, depending on the Indian state.

The USA, the European Union and Japan, by contrast, allow nearly all spirits to enter their markets duty-free. China tacks on only a 10 per cent charge on foreign liquor.

Under WTO rules, a second request for a formal investigation is automatically approved. A case can result in punitive sanctions being authorised. — AP

Bangalore, June 4
Rishad Premji, son of Wipro Ltd chairman and majority owner Azim Premji will join the company. The move is seen as a signal of eventual succession plans at India’s third largest software services exporter.

“Rishad Premji is going to join Wipro at a level commensurate with his background and experience,” the company said in a statement today.

Rishad currently works with a global consultancy firm in Europe. Because Rishad Premji is a relative of a director, his employment required shareholder approval, the statement said.

Azim Premji is one of India’s richest men by virtue of his stake of about 80 per cent in Wipro, which has a market capitalisation of around $20 billion.

New York-listed Wipro has minor interests in computer hardware and consumer goods such as lighting and soaps. — Reuters

New Delhi, June 4
Increasing number of inspectors coupled with substantial hike in interest rates from 7 per cent to 15 per cent for small and medium enterprises (SME) have crippled their productivity by about 30 per cent, according a survey conducted by an industry chamber.

“If the sliding trend is not reversed, SME’s contribution of 60 per cent to the total export proceeds of India will also be affected,” reveals a joint survey of Assocham-Tradindia.com on ‘How to make SMEs more competitive’.

Releasing the survey here today, Assocham SME committee chairperson Bikky Khosla said number of inspectors examining records of SMEs is increasing and it might exceed 45 with new services being brought into tax net.

Likewise, the rate of interest of SMEs, which should have been ideally 10 per cent, has touched 15 per cent and is hurting productivity of SMEs by 25 per cent, he said.

New Delhi, June 4
In a bid to give thrust to spices export, the Centre has embarked upon a multi-pronged strategy, including opening up of a office of the Spices Board of India in Jammu and Kashmir, launching of replantation scheme, setting up of spice parks and a marketing company to promote export of value-added spices.

“There is immense potential for increasing the export of not only saffron, but also of coriander seeds, cumins, chillies and garlic bulbs from Jammu and Kashmir. A technical team of Spices Board of India is working on identifying the place for opening an office in Kashmir,” Minister of State for Industry Jairam Ramesh told newspersons here.

At present 3000 hectares in Jammu and Kashmir are under saffron cultivation with an annual production of 9 tonnes, of which 6 tonnes are exported every year.

Asserting that for several years now there had been more focus on export of traditional spices like pepper and cardamom from Kerala, the minister said there is a need to shift focus to non-traditional spices export from other parts of the country, which have greater export potential.

Of the overall spices export of $793 million during 2006-07, pepper and cardamom accounted for only 10 per cent ($78 m), all from Kerala, while mint from UP worth $244 million and chillies from Andhra and Rajasthan worth $179 million put together accounted for about 50 per cent exports, Ramesh said.

“This clearly calls for “de-Keralafying” Spice Board as the Kerala perspective has crowded our spices programme for too long. Our effort should be to get a pan-India flavour,” he said.

The minister also informed that the government, with the help of state governments and private participation, will open spice parks in Uttar Pradesh, Kerala, Andhra Pradesh and the north-east.

The minister also made an interesting decision to launch Flavourite Spices Trading Limited, a fully-owned marketing subsidiary of Spices Board of India, for the development of Indian brand identity.

The new marketing company, whose initial capital of Rs 10 crore has come from Spices Board of India, will not only look at promoting export of spices abroad, but also market the produce in the domestic market.

“Only 9 per cent of the total spices production is exported and the rest is consumed within the country, so domestic market is even more important. Therefore, the board is in talks with Mother Diary for the distribution of branded spices through outlets in Delhi,” Ramesh said.

Mumbai, June 4
Shares of Aditya Birla Group company Hindalco today surged nearly 11 per cent on speculation that Canadian aluminium giant Alcan Inc could team up with Vedanta group firm Sterlite to launch a bid for acquiring the firm.

The scrip of the country’s biggest aluminium producer rose by Rs 15.25 or 10.81 per cent to its intra-day high of Rs 156.25 on media reports that Alcan could consider this route to guard itself against a hostile takeover offer from US-based Alcoa Inc.

Close to 62 lakh equity shares of Hindalco exchanged hands and the scrip finished 4 per cent higher or Rs 5.6 over today’s closing of Rs 141, data available on the BSE show.

Interestingly, Alcan and Hindalco were earlier involved as (45:55) JV partners in Utkal Alumina International project in Orissa. In April, the Canadian firm announced its intention to exit the venture as the project did not proceed as planned.

The promoters of Hindalco own 27.06 per cent or 31 crore shares in Hindalco, which recently acquired Canada’s Novelis in a $6 billion deal.

Based on today’s closing, Hindalco has a market cap of Rs 17,000 crore or $4.2 billion. — PTI