Thursday, March 11, 1999
today's calendar
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B U S I N E S S | Thursday, March 11, 1999 |
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spotlight today's calendar |
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Surcharge to go by
year-end: Sinha
Hosiery
park near Sonepat |
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Cabinet decision to benefit
rice millers in Punjab Disinvestment
panel to get back powers Siemens
unveils new technology |
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Surcharge to
go by year-end: Sinha NEW DELHI, March 10 — The Union Finance Minister, Mr Yashwant Sinha, today said that the 10 per cent surcharge imposed on Corporate Tax in the budget for 1999-2000 was purely a “temporary” measure and it would be abolished by the end of the next financial year. Addressing a post-Budget meeting organised by the CII here, Mr Sinha said he expected the next financial year to be a good year for the economy and revenue would pick up. Better revenues, he said would give him enough strength to do away with the surcharge and “I promise they will go” he added. Reacting to the demand of specific industries, Mr Sinha ruled out any change in the three-tier excise slab structure saying if one brick was removed the whole structure would come crumbling down. He said revenue considerations and the difficult financial position forced the government to be less adventurous with regard to restructuring the Customs Duty, which had been reduced to five slabs from seven slabs. He said the government was moving towards simplifying the tax structure in the country and making them more friendly. In this regard he said even the mindset of the people in the tax department was being changed and the government was working towards eliminating harassment for the tax payer. On the deferment of 5 per cent equity in State-owned Indian Oil Corporation to the next financial year, he said this would have little impact on the Government’s efforts to meet the disinvestment target this year. The government had deferred the proposal due to depressed prices of IOC scrip. The Finance Minister asserted that the Government was not anymore shy of the word privatisation and it would go for large-scale strategic sale in 1999-2000 to meet the disinvestment target of Rs 10,000 crore. Reacting to the CII
President, Mr Rajesh Shah’s demand for a holistic
approach on the issue relating to zero customs and zero
excise duty, Mr Sinha said the Government had appointed a
committee under Revenue Secretary to study the issue. |
‘TRAI
tariff can’t be challenged in court’ CHANDIGARH, March 10 — The tariff recommendations announced by the Telecom Regulatory Authority of India (TRAI) yesterday cannot be challenged in court or even altered by Parliament. This was announced by Mr M.R. Pai, a known crusader for public causes, during an interaction with members of The Tribune family here this evening. Terming STD as “subscribers trying and dying”, Mr Pai picked up the Telecom Department and banks to highlight their malfunctioning with anecdotes and personal experiences, tinged with wit and vitriol. In the USA, he said, the telephone rates have come down by half. But in India these have gone up. “We pay for the Telecom Department’s inefficiency.” “We should not grudge telecom concessions to rural subscribers. They have paid for telephone services which have largely been owned and enjoyed by the urban elite,” he said. Pleading that telephones should be accessible to illiterate villagers, Mr Pai said a World Bank study indicated that rural phones stimulated market economy. During the monsoon in Bombay a dead man coming to life won’t surprise as much as a dead telephone would. When his phone went dead, Mr Pai threatened legal action and the department swung into action. Under Rule 412 of the Telegraphs Act a Divisional Engineer is responsible for the maintenance of telephones under his jurisdiction, he said. However, public apathy and ignorance of laws contributed to the sorry state of affairs. Known countrywide for his letters to editors, Mr Pai exhorted the educated to put issues before the people and discard “chalta hai attitude.” “Writing a letter to an editor is as good as addressing one lakh people.” The Press has a tremendous role to play in social awakening, he said, adding that “had there been more Tribunes, the picture of the country would have been different.” Mr Pai, described as “a campaigner and a crusader for citizens’ rights” by The Tribune Editor, Mr Hari Jaisingh, has written numerous articles, pamphlets and books to create public awareness. He is actively involved in the Forum for Free Enterprises. Turning to banks, Mr Pai, who is the Honorary Secretary of the All India Bank Depositors’ Association, said under the rules a bank must clear a cheque within the prescribed period or pay penal interest. Few banks follow the rule and few customers insist on this. “We people gift funds to banks” for which they get interest. To a question — Should one invest in the Gold Bond Scheme? — Mr Pai said an emphatic No. “I don’t trust the government, no matter to which party it belongs.” At the same time, he praised politicians. “They have kept the democratic system going.” Mr S.D. Bhambri, General
Manager of The Tribune group, presented a book “The
History of The Tribune” to Mr Pai. |
Cabinet
decision to benefit rice millers in Punjab NEW DELHI, March 10 — The decision of the Cabinet Committee on prices to allow relaxation in regard to specifications of rice would benefit rice millers in Punjab, who are saddled with huge quantities of rain-affected paddy. The Cabinet committee on prices last night decided to allow relaxation in regard to specifications of rice to the extent of 3.5 per cent for damaged and slightly damaged grains, 6 per cent for discoloured grains and 25 per cent for broken grains. This relaxation would apply to the rice milled from the paddy purchased since the beginning of the season on September 15, 1998. It may be recalled that the Punjab Chief Minister, Mr Parkash Singh Badal, had last week taken up the matter with the Prime Minister, Mr Atal Behari Vajpayee. During the meeting Mr Badal pointed out that large stocks of paddy had been affected due to widespread unseasonal rain during September and October, 1998, and there was a need to grant relaxation in rice specifications for millers with effect from September 15, 1998. The Centre had earlier
allowed relaxation in rice specifications from October
27, 1998. |
Why was US
team allowed to study child labour? NEW DELHI, March 10 — The Opposition today demanded an explanation from the government as to why a US team of custom officials was permitted into the country to assess forced child labour in the Indian textile industry. The issue figured in the Rajya Sabha during question hour when the Minister for Textile, Mr Kashiram Rana said the government had permitted a three-member US team to visit India to gather information on forced child labour in the hand-knotted carpet industry. When Mr Rana told the BJP member, Mr Rajnath Singh Surya in reply to main question that the visit had no bearing on our sovereignty, the Opposition members asked the Minister to inform them whether it was obligatory on part of India to allow such visits. The Congress member and a former Commerce Minister, Mr Pranab Mukherjee asked since it was a government-to government issue and not a buyer-seller relation, what was the rationale of allowing US custom officials into India to study what was essentially a bilateral trade issue. At this, the members got
agitated and wanted to know whether it was possible to
conduct an investigation without gathering information. |
Disinvestment panel to get back powers NEW DELHI, March 10 (PTI) — The Centre today assured the Disinvestment Commission that its powers would be restored in the next few weeks, Commission Chairman G.V. Ramakrishna said. “The government has taken a positive view and assured the commission that action, including restoration of powers, will be taken in the next two/three weeks,” Ramakrishna told PTI after a meeting with Finance Minister Yashwant Sinha. Sinha had said yesterday that a view on the shape of the Disinvestment Commission would be taken at a meeting of the Cabinet Committee on Disinvestment, headed by Atal Behari Vajpayee next week. The commission had threatened to resign if the government did not give it powers of supervision and implementation of disinvestment of the government stake in the public sector undertakings (PSUs). The Commission’s original powers, including supervising overall sale process and taking decision on instrument, pricing and timing were clipped by the United Front government in January, 1998 to render it only as an “advisory” panel. Ramakrishna and other
members of the commission had met Sinha and Industry
Minister Sikander Bakht last month to convey that they
might quit if the government did not take a positive
approach on the commission. |
Hosiery park
near Sonepat SONEPAT, March 10 — The Haryana State Industrial Development Corporation (HSIDC) is setting up a modern hosiery and textile park in an area of 500 acres of land at Barhi village between Murthal and Ganaur in this district. The Labour and Employment Minister, Mr Ramesh Chander Kaushik told mediapersons here that this park is being set up on the pattern of Ludhiana which is famous for the hosiery goods not only in the country but in the world also. The project will cost
around Rs 40 crore and at least 500 units for the
manufacturing of hosiery goods would be accommodated in
this park. Mr Bansi Lal will lay the foundation stone of
this park on March 13. |
Siemens
unveils new technology NEW DELHI, March 10 — For the first time in India, Siemens is offering a unique communication system that would enable subscribers to talk, surf on the Internet, and for that matter send video and text data in the same system. The launch of the new system is a major breakthrough in the communications sector as the fundamental problem of today’s networks is that the voice and data service require separate systems and network functions. The system known as the “EWSD Innovations” (the German abbreviation for digital technology) brings about a convergence in the various forms of communication which in other words mean that transmission of audio, graphics, video and text data would be possible in an integrated manner within a single telecommunication environment. Managing Director of Siemens, Mr Hans Wefelscheid, addressing a press conference here today, said that Siemens has already bagged its first order of EWSD Innovations from Bharti Enterprises and is in active discussions with all major public and private operators. “Voice market, the world over, is rapidly changing into data market comprising voice, text, graphics and video. By year 2000, voice and data is expected to be in 50:50 ratio and shall grow to 30:70 respectively by the year 2003,” he said. Mr V.K. Aggarwal, Vice-President wireline network communication and transport communications, stated that on the internet service front, Convergence will ensure special features including call waiting internet busy, e-mail waiting indication, subscriber controlled input via internet and click to dial. Executive Director of
Siemens, Mr D.K. Ghosh, said that the advantages of EWSD
Innovations are integrated access, common management and
billing, new features and optimum interworking. “For
the first time, Convergence will translate into several
benefits to all customer segments,” he said. |
New
issue analysis Issue: IDBI Flexibonds-6 Issue size: Rs. 1500 crore Opens/closes: 22.2.99/15.3.99 Analysis: This is the third of IDBI’s Rs 5,000 crore umbrella sanction received from SEBI, has been accorded an ‘AAA’ rating by both Crisil and Care. On offer in this issue are four types of bonds, namely Regular Income Bonds, Growing Interest Bonds, Retirement Bonds and Infrastructure (Tax Saving) Bonds. The regular Income Bond has a seven year tenure, although inbuilt therein is an early exit (put) option exercisable at the end of five years. The minimum investible amount required to be made is Rs 5000 for the annual income option, Rs 10,000 for the semi-annual income option and Rs 20,000 for the quarterly income option. The coupon rates on offer under the Growing Interest Bond are 11 per cent for the first year, 12 per cent for the second year, 13 per cent for the third year, 14 per cent for the fourth year, 16 per cent for the fifth year, 18 per cent for sixth year and 20 per cent for the seventh year. The Yield to Maturity (YTM) for the seven-year period thus works out to 14.09 per cent. Notably, this bond offers investors an exit option anytime after one year, thus enhancing liquidity. The Retirement Bond offers and equated annual payment to investors on completion of a specified wait period. The minimum investment herein is four bonds, which aggregates Rs 20,000. The infrastructure (Tax Saving) Bonds which make investors eligible for income tax breaks under Sections 88, 54EA or 54EB, further offers two sub-options. Under Option A, the tenure of the bond is three years. It involves an annual interest payment option wherein a coupon rate of 12.50 per cent is offered to investors seeking tax breaks under Section 88 or Section 54EA, and the tenure of the bond is three years. In case of investors seeking to avail of a tax break under Section 54EB, the tenure is seven years and the coupon rate is 13 per cent. Under option B, which is a cumulative investment option, the YTM works out to 12.66 per cent for the three-year option along with tax breaks under Sections 88 and 54EA, while the YTM is 13.32 per cent for seven years along with a tax break offered by Section 54EB. Conclusion:
As usual, it is Infrastructure (Tax Saving) Bond that
appears to be the best bet, especially considering that
the close of the financial year is now round the corner,
making it the time when tax saving investment instruments
are in demand. Furthermore, the shorter tenure of three
years makes it a frontrunner even among the Section 88
investment instruments. |
CHANDIGARH (TNS): Putting a “fair and standard” price on a second-hand car is often debatable. The value of a second-hand car usually depends on the history of the car, its condition at the time of sale/purchase, the extent of use, the year of manufacture and the number of owners. Kotak Mahindra Primus Ltd has decided to release a list of second-hand car prices on a monthly basis. The list is based upon data collected from 21 different cities which include Chandigarh, Delhi, Ludhiana and Mumbai. If one has to buy or sell a second-hand car, one probably meets the neighbouring dealer to find a buyer. The dealer, while working on a commission basis, tries to get the best possible margin for himself. The buyer and the seller do not often meet. Also, the dealer does not let either party know the actual price being transacted. Kotak Mahindra Primus plans to maintain a database on the second-hand car prices as this has been one segment of the car financing business that has been ignored by the organised players so far in spite of a tremendous potential for growth in this segment. With the entry of specialised foreign players in the Indian car market, second-hand car prices are expected to become attractive to customers. Kotak Mahindra Primus has started releasing monthly prices of second-hand cars. Here is its list for February: These prices are indicative averages and may vary from city to city depending on market conditions and applicable taxes. Prices may also vary with the condition of the car and how it has been used. Hero Honda NEW DELHI (PTI): Hero Honda Motors Ltd has hired the services of Indian Market Research Bureau to study the two-wheeler market trend in the country so that it could position its two new motor cycle models in appropriate segments. The company plans to launch two new models next year between the range of 100 cc and 156 cc but has not yet decided about the engine powers and the segments. Senior Vice-President of the company Atul Sobti told PTI that Hero Honda has asked the partner Honda Motors Ltd of Japan to design vehicles according to Indian conditions. Opel Corsa CALCUTTA (PTI): General Motors India will launch Opel Corsa by the end of this year to compete at the premium end of the lower mid-size segment of the automotive industry. According to Vice-President (Marketing) of GM India Rajeev Chaba, the company will either launch the diesel or petrol version of Opel Corsa, “both options are open.” Santro NEW DELHI, (PTI):
The advertising campaign of Hyundai Motor India
Ltd’s Santro car has been adjudged the best campaign
for 1998 by Advertising Club, Calcutta, the oldest
ad-club of the country. The Santro campaign edged out
competition from Mirinda Lime campaign of Pepsi Foods,
the discovery campaign of Discovery Channel and the De
Beers campaign of De Beers Ltd to win the Gowtam Ghosal
silver trophy, a company release said. |
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| CACL NEW DELHI, March 10 (TNS) — ICRA has assigned AI rating to the commercial paper programme of Competent Automobiles Company Limited (CACL). Incorporated in 1985, CACL is engaged in sale and service of Maruti Udyog Limited vehicles. MTV
MD Economic daily St Resorts Crisil Forex rates U.S. $ Rs. 42.43/44 The RBI reference rate was Rs 42.44. Strike Motorola
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