Wednesday, January 5, 2000,
Chandigarh, India






THE TRIBUNE SPECIALS
50 YEARS OF INDEPENDENCE

TERCENTENARY CELEBRATIONS
B U S I N E S S
Women workers and others at the Osaka Stock Exchange (Japan) are all smiles as they give three cheers and pray for a booming economy at the annual traditional ceremony marking the first day of the trading for the New Year on Tuesday. — AP
Women workers and others at the Osaka Stock Exchange (Japan) are all smiles as they give three cheers and pray for a booming economy at the annual traditional ceremony marking the first day of the trading for the New Year on Tuesday. — AP


EARLIER STORIES


 

ST implementation panel to meet in Delhi
CHANDIGARH, Jan 4 — As the issue of enforcing a uniform floor rate of sales tax continues to hang fire, the implementation committee will meet in Delhi on January 10 to take up the issue with the Finance Ministry. The committee will also review the overall progress on this front.

Run-up
to
Budget
2000
Lower taxes for better compliance: industry
NEW DELHI, Jan 4 — Finance Minister Yashwant Sinha begins his week-long pre-Budget meetings tomorrow amidst industry’s demand for a stable taxation policy and rationalisation of customs and excise duty structure.
Duty structure to be recast

Mirza Tanners to issue 1:1 bonus
NEW DELHI, Jan 4 — Mirza Tanners Limited on Tuesday announced bonus share in the ratio of one share for every share held.

RPL ahead of Reliance Indus
NEW DELHI, Jan 4 — Reliance Petroleum has become a more valuable company than the flagship company of the Ambani group, Reliance Industries Ltd, based on market capitalisation, according to data sourced from the Centre for Monitoring Indian Economy.

KVIC package for border areas
AMRITSAR, Jan 4— Dr Mahesh Sharma, Chairman, KVIC, has said that KVIC will formulate a special package for the border districts of Amritsar, Gurdaspur and Ferozepore.

Transporters’ stir hits life
MUMBAI, Jan 4 — Life in the city continued to be affected by the transporters’ strike that entered its second day today even as the government appealed to those on strike to resume work and spare the common man from hardship. Drivers of vehicles carrying essential commodities decided to join the week-long strike called by the “Maal Vahatuk and Pravasi Vahatuk Malak-Chalak Kriti Samiti” to oppose the decision of Transport Commissioner.
Drivers sit on their taxis at Mumbai Central on Tuesday as the transporters’ strike enters the second day. — PTI
Drivers sit on their taxis at Mumbai Central on Tuesday as the transporters’ strike enters the second day. — PTI

CII’s Partnership Summit from Jan 9
NEW DELHI, Jan 4 — Over 1,000 top decision-makers from the Government, industry and multilateral agencies including World Trade Organisation chief Mike Moore, are expected to participate in CII’s flagship event, Partnership Summit, beginning here on Sunday.

ST implementation panel to meet in Delhi
By Sarbjit Singh
Tribune News Service

CHANDIGARH, Jan 4 — As the issue of enforcing a uniform floor rate of sales tax continues to hang fire, the implementation committee will meet in Delhi on January 10 to take up the issue with the Finance Ministry. The committee will also review the overall progress on this front.

Only three or four states — Kerala, Andhra Pradesh and Gujarat — have enforced the uniform floor rate as recommended by the implementation committee comprising the finance ministers of Punjab, Uttar Pradesh, Karnatka, Gujarat, West, Bengal and Madhya Pradesh. The rates were to be enforced from January 1,2000.

Capt Kanwaljit Singh, Punjab Finance Minister, told TNS that certain states could not implement the decision due to legal hitches. As the Cabinet of the Punjab Government had approved the decision with regard to floor rates, the authorities concerned in Punjab had already prepared notifications to be issued in this connection.

However, informed sources said that in Delhi a powerful lobby of the traders had scuttled the move of the Delhi Government with regard to the floor rate the traders lobby has strongly opposed the implementation of the uniform rate as it would adversely hit their trade. Due to low tax rates in Delhi, it had emerged a major trade centre in the country, affecting in a big way neighbouring states, especially Uttar Pradesh, where the revenue from ST remains low.

Likewise the Union Territory of Chandigarh has become an eyesore for Punjab. Due to cheaper rate of sales tax in city beautiful, most of the manufacturers have established their godowns for stacking their products and for the billing purpose. As people prefer to buy commodities from Chandigarh. It affects the revenue from sales tax in Punjab. Because of cheaper rates of ST on diesel and petrol in Chandigarh fuel stations in Punjab areas adjacent to Chandigarh remain almost dry.

Capt Kanwaljit Singh said the implementation committee would press the Finance ministry to enforce the uniform ST rates by imposing the penalty clause the provision of which was made by the committee in its recommendation. Under this clause, Central grants and assistance to defaulting states could be stopped by the union government.

Claiming that Punjab’s financial situation has improved, Capt Kanwaljit Singh said from this month old-age and other pensions would be distributed along with the monthly salary payment. He claimed the sales tax collection had touched a figure of Rs 1400 crore and it would be around Rs 2000 crore by the end of current financial year. Top


Lower taxes for better compliance: industry

NEW DELHI, Jan 4 (PTI) — Finance Minister Yashwant Sinha begins his week-long pre-Budget meetings tomorrow amidst industry’s demand for a stable taxation policy and rationalisation of customs and excise duty structure.“Central excise and customs should be suitably amended to safeguard the interest of domestic industries on the lines of India’s stand at the WTO,” Assocham said on the eve of the pre-Budget meetings beginning with representatives of farmers and economists tomorrow.

During the meeting with industrialists on January 7, the captains of Indian industry will impress upon Sinha to consider the introduction of alternative measures to neutralise the hidden costs, like high cost of power and capital, to make India’s exports competitive to meet the challenges of globalisation.

Worried by mounting fiscal deficit due to growing non-plan expenditure and disinvestment targets not being met, Sinha is expected to elicit the views of the industry and economists on stepping up revenue mobilisation and cutting subsidies.

Industry has already made its view clear on rationalisation of taxes pointing out that lower the direct and indirect tax rates, the better the compliance.

The industry associations have been demanding that service sectors and agricultural income should be brought under the tax net to widen the base to shore up revenue.

However, Assocham has opposed taxing agricultural income in view of its low revenue potential and instead suggested a significant hike in land revenue rates on non-agricultural land.

Meanwhile, different industry chambers have asked for a single rate of excise duty to overcome the problem of inverted duty structure.

“A zero base exercise on scientific basis should be done for rationalisation of excise to classify various commodities under merit, demerit and central rate instead of merging various rates into a nearest rate,” it said.

The industry has also asked for withdrawal of 10 per cent surcharge on corporate tax to prop up the bottomlines of Indian companies on the plea that the industry is facing demand recession.

But what the industry needed was a “stable tax rates” and long term fiscal plans, Mehta said, a view seconded by Assocham which said frequent changes in taxation resulted in more harm than good.

The Federation of Indian Export Organisations (FIEO) has expressed hope that the 2000-2001 Budget will continue with the tax relief on export earnings for another five years and wants the highest rates of duty drawbacks be made available to exporters.

Realisation of export proceeds should be made quicker and simpler, especially in the hands of nationalised banks, FIEO said adding that interest rates for export financing should be at par with LIBOR.

PHDCCI President K.S. Mehta has suggested that maximum direct tax rates for both personal income and corporate should be brought down to 25 per cent.

Likewise in excise duty the rate at the top slab should be brought down from the present 24 per cent to 15 per cent, he said adding that there should be only four duty slabs of zero, five, 10 and 15 per cent.

Plan allocation: Sinha also met members of the Planning Commission to decide the budgetary size of the Plan allocation for States.

According to informed sources, it was decided that the allocation to the States will be much more than that last year, and could be higher than 15 per cent.

The members of the Planning Commission felt that in no case should the allocation be lower than last year’s. The Planning Commission team was headed by Deputy Chairman Planning Commission K.C. Pant and the Finance Minister was assisted by top officials of the Finance Ministry.

The meeting also decided that the disinvestment target will continue to be high.

The disinvestment target for the current fiscal is Rs 10,000 crore but the Government has been able to procure much less than this amount.

One of the main issues that figured at the meeting was the ways and means of increasing revenue and cutting expenditure. The Finance Ministry officials were optimistic about high revenue achievement in the coming financial year.Top



 

Duty structure to be recast

NEW DELHI, Jan 4 (UNI) — Mr Sukumar Shankar, Member Budget, Central Board of Excise and Customs, has indicated that the coming Budget will further rationalise and realign the Customs and central excise duty structure. Addressing a pre-Budget interactive session of the PHD Chamber of Commerce and Industry here today, Mr Shankar said the Government would accord importance on strengthening the indigenous industry in terms of competitiveness by focussing on quality, technology and pricing against imports.

The Government would charge the lowest rate of Customs duty on raw materials and the highest rate on finished products as a policy with exceptions.

He said as part of the tax reforms process, the Excise Department is accepting the private record of assessees who have paid duty through the PLA system above Rs 5 crore per annum.

Responding to the suggestion by PHDCCI President KS Mehta on categorising commodities based on merit, mean and demerit rates after applying appropriate socio-economic norms independent of Revenue bias, Mr Shankar asked the chamber to list specific items for the purpose.

The chamber requested Mr Shankar to moderate the high excise rate structure ranging from 30 per cent to 40 per cent on specified commodities to a lower maximum rate of 20 per cent.Top



 

Mirza Tanners to issue 1:1 bonus

NEW DELHI, Jan 4 (UNI) — Mirza Tanners Limited (MTL) on Tuesday announced bonus share in the ratio of one share for every share held.

MTL had issued bonus shares in the ratio of one share held in 1997 increasing the capital from Rs. 4.07 crore to Rs. 8.14 crore. With the new bonus issue the capital of the company will increase to Rs. 16.28 crore. This is the fifth bonus issue of the company. With the present bonus issue 92.5 per cent of the capital of Rs.16.28 crore consists of bonus issued from 1991 onwards.

Its board meeting at Kanpur, Announced an interim dividend of 55 per cent for the current financial year ending March 31, 2000. During the previous year the company had paid dividend of 50 per cent.Top


 

RPL ahead of Reliance Indus

NEW DELHI, Jan 4 (PTI) — Reliance Petroleum (RPL) has become a more valuable company than the flagship company of the Ambani group, Reliance Industries Ltd, based on market capitalisation, according to data sourced from the Centre for Monitoring Indian Economy (CMIE).

The market cap of RPL was Rs 27,030.15 crore on December 24 compared to Rs 20,962.67 crore of RIL.

Market cap is market price of the company’s stock multiplied by the number of outstanding shares.

Both companies of the Ambani group were among the country’s top 10 most valuable companies.

RPL was ranked sixth, based on market capital (MC) and RIL at eighth position.

Between January 1 and December 24, 1999, MC of RPL increased by 692.74 per cent from Rs 3,409.7 crore to Rs 27,030.15 crore, while RIL increased from Rs 11,345.06 crore to Rs 20,962 crore, a rise of 84.77 per cent.

The sudden rise in the MC of RPL was due to the rise in the share capital which increased from Rs 891.7 crore to Rs 3,869 crore due to the conversion of convertible debentures into equity.Top


 

KVIC package for border areas
Tribune News Service

AMRITSAR, Jan 4— Dr Mahesh Sharma, Chairman, KVIC, has said that KVIC will formulate a special package for the border districts of Amritsar, Gurdaspur and Ferozepore.

Addressing a press conference here, he said a zonal training centre of KVIC will be set up at Mohali.

Dr Sharma, who also visited Hoshiarpur and Jalandhar districts, inspected the production centres of Shree Gandhi Ashram and Khadi Gramudyog Mandal, Patti.

Addressing a public meeting, he appreciated the Punjab Khadi Gramudyog Institutions Federation for its cooperation.

Mr Rajinder Singh Marwah, member, Punjab Khadi & V.I. Board, explained the policy of the Punjab Government on self-employment. Mr Karnail Singh, State Director, KVIC, highlighted achievements of the State office.

Dr Sharma also called on the Governor of Punjab, Lieut-Gen J.F.R. Jacob, and discussed KVIC activities with him. The Governor expressed his desire to visit the Zonal Beekeeping Extension Centre of KVIC at Bassi Pathana.

Dr Sharma inaugurated a marketing campaign for wood craft at Khadi Bhavan, Hoshiarpur. Top


 

Transporters’ stir hits life

MUMBAI, Jan 4 (PTI) — Life in the city continued to be affected by the transporters’ strike that entered its second day today even as the government appealed to those on strike to resume work and spare the common man from hardship.

Drivers of vehicles carrying essential commodities decided to join the week-long strike called by the “Maal Vahatuk and Pravasi Vahatuk Malak-Chalak Kriti Samiti” to oppose the stringent action proposed by the Transport Commissioner against polluting vehicles in keeping with the Mumbai High Court directive.

Over 55,000 taxis, one lakh rickshaws, 55,000 trucks and autorickshaws and 7000 private buses, including 150 school buses, had joined the strike, Mr Sharad Rao, samiti joint convener claimed.

Several vehicles arriving from outside Mumbai were being stopped at New Mumbai and Thane, he said, adding the strike was not against the court directive or the anti-pollution drive launched by the Transport Commissioner but against the alleged “failure” of the government to provide unadulterated fuel and basic amenities to transporters.

According to Transport Secretary Suresh Chandra, the government had made alternative arrangements for the transport of essential commodities and passengers.

The strike has shot up prices of essential commodities by as much as 25 per cent. This has prompted the government to warn the merchants that obstruction of essential commodities is an offence under the Essential Commodities Act, 1955. The order was issued last night.Top



 

CII’s Partnership Summit from Jan 9

NEW DELHI, Jan 4 (PTI) — Over 1,000 top decision-makers from the Government, industry and multilateral agencies including World Trade Organisation (WTO) chief Mike Moore, are expected to participate in CII’s flagship event, Partnership Summit, beginning here on Sunday (January 9).

The sixth edition of the three-day event, being organised for the first time in the national Capital, will focus on global trade and economic issues.

Partnership Summit on “Managing Globalisation in the New Millennium’ will be inaugurated by External Affairs Minister Jaswant Singh, a CII release said here.

“As the world order becomes more liberalised and all encompassing and access to communication technologies improves, Partnership Summit will provide a platform for Indian stakeholders to form views and opinions in conjunction with overseas participants,” the release added. Top


 
THAT's IT

India’s first virtual market launched

CHENNAI, Jan 4 (UNI) — Satyam Infoway limited today launched India’s first virtual market place to buy and sell services.

Satyam Infoway Chairman Ramalinga Raju and Managing Director Ram Raj told reporters that the website www. serwiz.com is set to open up global markets for Indians in the service industry by providing a virtual instant link between the service provider and the consumer services.

The service will offer virtual visas to any professional in the country to offer services worldwide using the website, they explained.

Using the web, 80 per cent of the services can be provided from remote areas to customers anywhere, Mr Ram Raj said.

Initially Satyam Infoway will provide business-to-business links and then take to the logical conclusion of offering individual to individual links.

Mr Raju explained that the opportunity for virtual delivery of services was still unexplored in India.

Millions of small and medium sized business and professionals in Indian can now effectively offer their services to the global market through the new initiative.

While they bring in their skills, the company will assist them with the soft and hard infrastructure and marketing support.

Mr Ram Raj said IT-enabled services could be substantial in the next 10 years.

India had a huge talent pool that will make it an obvious destination for global players to source services, he added.

Voice messages

BANGALORE, (PTI): InterCope (India), a Bangalore-based software company, on Tuesday launched its new portal application ‘ivoice’, a free service to users who wished to send voice messages from the Internet to normal telephones and receive voice responses.

Deepak Makra, Managing Director of InterCope, told reporters here that users could log on to web-site www. icope.com, record their message, specify the phone number and the voice message gets delivered in the original voice to a normal telephone. This facility is at present available in Bangalore.

Kanika Infotech

CALCUTTA, (UNI): Kanika Infotech Limited has entered into business tie-ups with the US-based Cyberton Inc. and Bema Seat Management Services of Singapore.

Addressing a press conference here on Tuesday, company Director (Technical) Ratan Kumar Guha said it had also received confirmation of alliance from Interquest Corporation, a Japanese company along with Prime Corporation of the UK.

Intelligent e-business

CALCUTTA, (UNI): Information technology powerhouses Intel, Compaq, 12 and Price Waterhouse Coopers (PWC) on Tuesday launched the first of its kind centre of excellence for intelligent e-business in India.

A PWC release said that the centre will enable clients evaluate how intelligent e-business solutions could add value by transforming their organisations into high velocity enterprises.

IT Tycoons

NEW DELHI, (TNS): Mr Atal Behari Vajpayee will meet a team of successful Indian entrepreneurs from Silicon Valley on January 12.

The entrepreneurs, including Hotmail founder Sabeer Bhatia, who has sold the mail service site to Microsoft for $ 400 million, will suggest measures for making the country a global software giant by capturing 6 per cent market share by 2008.

They will make presentations on latest trends in venture capital funds and angel investments in four vital fields — value-added IT services, software products, IT-enabled services and e-business, official sources said.

Besides, the group will take up the McKinsey report, commissioned recently by NASSCOM, to achieve $ 57 billion export target.

The group will comprise Indus Entrepreneurs President Kanwar Lekhi, Mr Suhas Patil (member) and Mr K D Chandrashekar of Exodus Communications.Top


 
BIZ BRIEFS

Bullion
Gold Std. Rs 4430
Gold 22-Ct Rs 4280
Silver Ready Rs 8050
Silver delivery Rs 8060

Forex
US $ Rs 43.50/54
Stg Rs 70.29/31
Euro Rs 44.69/71
Yen (100) Rs 42.35/37

Indica
MUMBAI, Jan 4 (UNI) — Telco sold 5,320 units in December, 1999, up from 5,214 units sold in the previous month the same year. According to a statement issued here today, the cumulative sales for Indica stood at 38,729 numbers since its launch and at 36,583 units for the first nine months of the current financial year.

Motor parts
JALANDHAR, Jan 4 (FOC) — Punjab motor parts traders are sore over the increase in sales tax on motor parts from the beginning of new year. In a joint statement here today, Mr Satish Raheja, President and Mr Naresh Chibber, General Secretary of the Punjab Motor Parts Traders Association, criticised the State Government for the increase in sales tax from 2, 4 and 6 per cent to 4, 8 and 12 per cent on motor parts.

Sriman Org
NEW DELHI, Jan 4 (PTI) — BIFR has declared Sriman Organic Chemical Industries Limited a sick company and has appointed IDBI as the operating agency for preparing a revival package for the company. Top


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