|Sunday, April 16, 2000,
for closer Indo-US business ties
Conditional incentives for IT
Chambers welcome labour reforms
Need to rectify sales tax policy
Coolex 2000 expects Rs 6 crore
BPL posts 8 per cent
Syndicate Bank to pay 14 pc
NEW YORK, April 15 (PTI) The US President Bill Clintons recent visit to India has given a new impetus and direction to relations between the two countries and New Delhi and Washington should develop newer partnership in business as well in other fields mutually beneficial to each other, Finance Minister Yashwant Sinha has said.
Addressing several functions and fielding questions from the audience yesterday, Sinha spoke about the vast opportunities that exist for investment in India in several sectors, including infrastructure, telecommunication, energy, transport, pharmaceuticals and chemicals, biotechnology and food processing among others.
Stressing on pharmaceuticals, he said research in India would cost one-tenth of what companies spend in the United States. That could enable India as also world to have drugs at lower prices. Besides, a wealth of knowledge exists in the traditional systems of medicines which are only now getting attention.
Sinha, who is accompanied by a high level business and officials delegation, interacted with investors, non-resident Indians and Indian Americal entrepreneurs. They also held a closed door meeting of the Indo-American Chamber of Commerce besides organising road show to familiarise investors with areas in which India welcomes investment.
Sinha was in New York on way to Washington to attend the World Bank meeting.
Replying to queries, Sinha said his government is doing at a fast pace all that needs to be done to make the country attractive for investors.
At another point, he conceded that changing labour laws requires consensus and Government could not act hastily on that. If one man is thrown out of job, it could give new economy a bad name even if one hundred others got jobs, he said.
Sinha made presentation and replied questions with President of CII Rahul Bajaj and top officials by his side and he pointed out that what he is saying is not view of the Government alone but of the industry as well.
The government and industry, he said, are not, like old days, working at cross-purposes but towards the same goal and pointed to the presence of Rahul Bajaj.
At the road show, Joint Secretary of Power, Anil Razdan, Deputy Director General in the Department of Telecommunications N. Parmeshwaran, Joint Secretary (Chemicals) in the Ministry of Chemical and Fertilizers and Santanu Consul, Chairman of National Highway Authority, Deepak Dasgupta gave impressive presentations of the investment opportunities existing in different areas.
During a meeting with top officials at the New York Stock Exchange, the Minister was informed that about one dozen Indian companies are considering registering with it.
Sinha spoke about the
vision-2000 agreement signed by Prime Minister A.B.
Vajpayee and President Clinton in New Delhi and said it
is for the investors, entrepreneurs and people of the two
countries to make their dream a reality.
incentives for IT industry
THE Information Technology units, being set up in Punjab, are supposed to employ people of Punjab domicile if they are desirous of taking benefit of the fiscal incentives for this industry announced by the Punjab Government.
This is the only condition put by the State Government perhaps keeping in view two-pronged policy. The professionals coming out of various engineering universities could get placement and also to promote the IT industry in the State. Such units are to provide minimum 50 per cent of the total employment to persons of Punjab domicile.
Called special package of incentives for IT industry for the defined new units, this policy will continue for two years. The IT units located in Punjab will be given 10 per cent preference on application software developed for all Punjab Government departments, undertakings/boards/institutions etc. They will also be given preference for order, all other conditions remain the same. This incentive will be available to only ISO certified units.
Such units will also be given 20 per cent subsidy on the cost of pollution equipment for hardware units subject to a ceiling of Rs 5 lakh.
Under the facilitation services are (i) automatic clearance from the Punjab Pollution Control Board, simplified time bound single window clearance under the other statutory acts of the state and release of electricity connection by the Punjab State Electricity Board (ii) assured availability of quality power and back up power in the designated IT Parks (iii) IT industry, except for the hardware, will be permitted in the residential areas and premises. Such industries are to be included in the lists of users permitted in the no-development area of the Punjab Urban Development Authority.
The following fiscal incentives will be available to the IT units set up in the State irrespective of their location: Investment incentive (a) investment incentive (capital subsidy) at the rate of 30 per cent of the fixed capital investment (FCI) to the SSI, large and medium units set up in SAS Nagar (Mohali) as well as A category areas defined under the Punjab Industrial Incentive Code-under the industrial policy of 1996 (b) investment incentive of 20 per cent of FCI or small, medium and large units, subject to a maximum of Rs 30 lakh, in B category areas.
Such units will get exemtion/deferment from sales tax for 10 years. After 10 years safes tax would be charged at the rate of 2 per cent for hardware, one per cent for packaged software and zero per cent for customised software for a period of next five years. They will be exempted from payment of electricity duty for five year. Subsidy will be given on generator set.
Subsidy will be admissible to the units engaged in the development of IT in Gurmukhi script amounting to 5 per cent of the total turn over every year subject to a maximum of Rs 5 lakh per year for three years provided that the number of qualified IT professionals engaged on such project by the unit institution is more than ten.
Then there will be special subsidy for human resources development in IT and for expansion, diversification and modernisation of the units.
The categories of main industries included in the scope/definition of IT industry are as under:
Computing devices, other computer peripherals (input/output devices), Computer networking products, Power supplies for cimputing devices, computer communication equipment.
IT services/IT enabled services: communication services through VSAT and ISDN, internet service providers, e-commerce/e-business services, electronic data interchange, video conferencing, medical transcription, call centres, back office operations like revenue accounting, data entry, data conversion etc, revenue maintenance and support, data service centres and electronic content development etc.
plans cyber park in Gurgaon
CHANDIGARH, April 15 Secretary, Tourism Government of Haryana and Managing Director, HSIDC Dr. Harbakhsh Singh has said that the HSIDC proposes to set up a cyber park in Gurgaon.
Speaking at a function organised by a private information technology coaching centre in Panchkula, he further said within this month the Government of Haryana plans to come out with its information technology policies. The emphasis would be on training boys and girls in computers right from the primary level.
The government will help to companies who come forward to invest in the region. He added that in America the tax contribution by the IT sector accounts for $200 billion, the same needs to done here. The government will give incentives like land, building, power etc. but will be unable to offer monetary support with the introduction of a uniform sales tax.
I have already catalysted investment of around Rs. 2600 crore. Companies like Honda Motor Cycles, Mitsubishi Electrical, Konka Electronics etc. have already invested in Haryana.
When asked why was Gurgaon selected for setting up a cyber park which already enjoys the benefits of big companies already in existence there and that the government should make other regions of Haryana conducive for the IT park, he replied that Gurgaon had well- established infrastructure to support the companies where as other areas need to grow a lot to meet the requirements of the IT Industry like communication network, power etc., which will take a long time.
Commenting on the state of affairs of Haryana Tourism, he said that the tourism industry of Haryana suffers from ills of public sector undertakings. The cure of these ills is to privatise the tourism industry. Few hotel and restaurants have already been selected for privatisation. To name a few: Hodel on the Delhi - Agra, national highway, Dharuhera ( near Rewari) on the Delhi - Jaipur national highway, Sultanpur lake, near Gurgaon, which was a famous bird sanctuary, Flamingo in Hisar, and Maina in Rohtak.
Responding to the reporters query about the increasing number of cases of free lunches, halts etc. by the relatives of bureaucrats and ministers, which amounts to loss for the hotel, he said that strong instructions are given to the DMs that they should not entertain such cases at all. He also informed that the Tourism Department has proposed to add more rooms and a banquet hall for Red Bishop, Panchkula, which is giving profits. This venture would be allocated funds worth Rs. 70- 80 lakh. Dr Singh also said that they also propose to set up an IT university in Gurgaon for which a foreign joint venture partner has been selected.
NEW DELHI, April 15 (UNI) Welcoming the Prime Ministers statement on reforming the existing labour laws, Assocham said an imaginative employment policy is what India needs for a rightful place in the comity of industrially advanced nations. India Assocham President Shekhar Bajaj said, human resource for optimising national wealth. The ten-point strategy recommended by Assocham for labour reforms includes discarding of Industrial Disputes Act and formulation of a new employment relations Act simplification, rationalization and integration of employment laws into a single employment relations Act minimum 10 per cent employee membership to be made compulsory for registration of a trade union and replacement of employment security with income security with due checks and balances.
FICCI also welcomed the move and said the flexibility that has to be adapted into the labour laws would lead to a win-win situation for both labour and the employers. There will be generation of more employment once the administrative and legislative rigidities are removed in the labour laws. This would lead to higher employment in a labour abundant economy like India.
It further stated that the rigidities in Labour Laws has seen by the international investing community as a stumbling block for channelising investment into India. Once the investors perception changes, there will be greater inflow of investment into the country. This is significant particularly at a time when India has decided to set up special economic zones to accelerate the exports and investment. One important pre-condition for the success of this scheme is that such zones should be free from the operation of labour laws.
rectify sales tax policy
WHIPPER in his rage often forgets to count the number of whips inflicted. Our Punjab Governments case is akin to that of a whipper. It needs to be reminded about this number.
World over governments make stable taxation policies so that the governments get its revenue and business flourish. In Punjab there is no sales tax policy. When the Government needs more funds to meet its requirements it just signals the taxation department. Sales tax on number of sensitive commodities have been levied at random. Some times even notifications lack the usual official authenticity.
Sales tax at first stage is against the pattern of working of industry & trade in Punjab. In the economic sense working of Punjabs industry is the most optimum. Final product comes out after processing through many individual units. This makes the use of precious capital investment most optimum as unlike elsewhere no equipment remains idle due to limited use by single unit. Thus sales tax should necessarily be at the last stage.
Ball bearings which have frequent replacement in every industry are taxed at the last stage in Delhi, Haryana, H.P. and Chandigarh. Delhi taxes them at 4 per cent while others at 8 per cent. Punjab brought it under first stage on May 17, 1999 with 2 per cent which was increased to 8.8 per cent on January25, 2000. So the traders of Punjab are almost wiped out.
Hosiery and yarn are major products of Punjab. Waste accruing in the process is also processed to use so that wastage is reduced to nil. This is the strength of this industry. Unfortunately the State Government has levied sales tax on wastes at almost every stage right at the first stage. This cascading effect has ruined this vital industry.
Packing materials are brought under first stage. This outrightly a double taxation. Manufacturers have to sell their products in packings and cost of this is included in the sale price. Sales tax is automatically realised. Now with separate tax at first stage dealers will pay sales tax twice.
After fully computerising sales tax barriers there is no sense of intercepting goods carriers en route under Section 14-B of the G.S. Tax Act. It is being done as if with vengeance and goods carriers remain intercepted for days together.
Heavy Annual Renewal Fee has to be paid by every dealer. This has no rationale.
The Municipal Corporation, Ludhiana has decided to charge octroi on power on ad valorem basis @ 2 per cent. This means straightway increase from 4 paise/unit to cover 6 paise/unit. This tax is the most discriminating. Of the two adjoining units for instance one may have to pay 100 times more octroi than its neighbour. In actual terms there are cases where this octroi alone may be about Rs 75 lakh/year for one and just Rs 7,500/year for the other. Industrial unit within octroi limit will lag behind a similar unit outside octroi. The way things are moving octroi on power in due course will be the single killer of industry.
The State Government has no viable arrangement for giving land either for new industry or for the expansion of the existing. Industry has to expand though in a limited manner on the existing land. Here PSIEC the main agency for this purpose is putting all types of hurdles. Heavy penalties are imposed on covered area in excess of prescribed limit. If excess area is permissible with penalty the same can be permissible without it.
In the interest of the
development of the State, Punjab Government should
rectify its policies as applicable to industry and trade
in connection with the business community. Some sort of
autocrat thinking is seen in some pockets of policy
making mecahnism. Even in its own political interest time
has come to remove grievances. More number of whips have
been left for the Government to count.
CHANDIGARH, April 15
(TNS) Coolex 2000 an exclusive exhibition
on air-conditioning and refrigeration in its third day
today has already generated business worth 2 crore.
Participating multinationals like Samsung India
Electronic, LG, Carrier, Voltas, Godrej, Electrolux
National and a host of other companies are anticipating
another 3 crore of business to be generated during the
last two days of the fair. Almost 10,000 visitors have
already taken benefit from product launches, free gifts,
easy finance options and discounts being offered by
participating companies. The exhibition will continue
till Sunday April 16, 2000.
BANGALORE, April 15 (PTI) BPL Limited recorded revenue of Rs 2,150 crore during 1999-2000, registering an 8 per cent growth over the previous fiscal, with sales of colour television crossing a record one million, and was all set to launch its second brand shortly, senior company officials announced here today.
The second brand
will be launched very very soon, the Companys
Director of International Operations, L.H. Bhatia, told
reporters. Test market is scheduled later this
month, he said but declined to give further
BANGALORE, April 15 (UNI) Syndicate Bank today declared their maiden interim dividend of 14 per cent to all its equity shareholders. The dividend will be payable to all registered shareholders whose names are on record as on May 16, 2000.
PSB cuts PLR
NEW DELHI: Punjab & Sind Bank (PSB) today announced to reduce its PLR to 12.25 per cent per annum along with cut in deposits rates. Revised PLR comes into effect from May 1 while deposits rates would be applicable from Monday.
The revised interest rates on domestic deposits for 15 days to 45 days will be 5 per cent, 46 days to 90 days six per cent, 91 days to 179 days 7 per cent, bank statement said.
While for deposits from
180 days to less than one year interest rate will be 7.5
per cent, for one year to less than two year rates are
8.5 per cent, between two years and upto three years
deposits rates are 9 per cent and for above three years
its 9.5 per cent.
by Praful R. Desai
Parity of treatment
Q: Admittedly it is for the employer to decide who should be and who should not be continued under suspension. Whether can there be any claim of parity of treatment of employees in such matters?
Ans: In the case of Ram Pal Singh v Regional Manager, Punjab National Bank (2000-I-LLJ-225) the Allahabad H.C. said thus:
The petitioner - employee who was suspended claimed parity of treatment with another employee whose suspension was revoked by the employers and thus he for was demanding revocation of his suspension.
The H.C. observed that there cannot be any concept of parity or there cannot be doctrine in the judicial process as has been held by the Full Bench of this Court in Chandresh Paswan v State of U.P. (1999 (38) ACC 721), inasmuch as there may be difference in the gravity of involvement of person. It is dependent on the employer to decide who should be continued under suspension and who should not be. It is purely an administrative decision, in the opinion of the H.C., with which this court cannot interfere.
No doctrine of parity can be applied in such case. It is for the employer who should decide as to whether it is necessary to keep a person under suspension or not. In the present case, it is alleged that the charges have already been framed as against the petitioner. It is further alleged against the petitioner, in comparison with those levelled against the other person who has since been released from suspension, are such that the order of suspension against the petitioner cannot be revoked.
In such circumstances,
the S.C. while disposing of this writ petition, directed
the respondent No. 1 to decide the petitioners
application for revocation of suspension in accordance
with law having regard to the facts and circumstances of
the case in the light of observation made above with
regard to the doctrine of parity as early as possible
within a period of three moths. However, the H.C.
clarified that this Court has not entered into the merits
of the case. The respondents therefore, will be at
liberty to decide the question according to their own
wisdom and discretion depending on the facts and
circumstances of the case. The H.C. in that way disposed
by the present writ.
by Pushpa Girimaji
Make ISI certification mandatory
COMPARATIVE testing of 21 brands of 6 ampere, three-pin electric plugs by an Ahmedabad-based consumer group has once again exposed the poor implementation of a law meant to protects the interest of consumers.
As per the Electrical Wires, Cables, Appliances and Accessories Quality Control Order, 1993, passed under the Essential Commodities Act, no person can store, sell or distribute certain electrical appliances and accessories as well as cables and wires without the ISI quality seal given by the Bureau of Indian Standards. The accessories and appliances listed under the order are switches for domestic and similar purposes, 2-ampere switches for domestic and similar purposes, three-pin plugs and socket outlets, electric irons, stoves, immersion water heaters and radiators.
Yet, Consumer Education and Research Society, Ahmedabad, found that of the 21 brands of 6 ampere three-pin plugs that they bought from various markets for comparative testings, five brands did not even have the mandatory ISI mark. Appalled by this, CERC has now referred the matter to the concerned authorities in the four states in which those plugs are manufactured: West Bengal, Gujarat, Delhi and Chandigarh. They have also brought this matter to the notice of the Bureau of Indian Standards.
But then, that is not the only cause for concern. CERC found, following laboratory tests that none of the 21 brands conformed to the parameters drawn up by the Bureau of Indian Standards on mechanical strength and construction. Says CERC: Plugs should be so designed and constructed that they are strong enough to withstand a fall and not get damaged. To check this, BIS specifies that the plug should be put inside a tumbling barrel and ideally they should remain intact after this test. But in most of the plugs, the screws opened and the cover and the pins separated. And 17 brands broke during the test. (for details of tests results, contact CERC at Thaltej, Ahmedabad-Gandhinagar highway, Ahmedabad-380054 for their magazine, Insight)
There is more. Eight of the 21 brands did not conform to the dimensions specified in the BIS Standards. This is one of the most important quality parameters because if a plug fits too loosely into a socket, then it can lead to sparking and heating of the plug and the socket. Besides this being a fire hazard, it will also reduce the life of the plug as well as the socket. On the other hand, it the plug has to be pushed into the socket with great difficulty, then there is every possibility of either the plug or the socket breaking, particularly at the time of pulling out the plug from the socket. So a plug must fit into the socket comfortably and should neither be too loose nor to tight and the pins should maintain proper contact with the socket. Its for this reason that the BIS standards specify, among others, the length and the diameter of the plug pins. Of the failed brands, while some had shorter pins, some had pins longer than specified in the standard. In some, the minimum distance between the current carrying pins and the periphery of the plug was found shorter. So if you have been complaining of loose-fitting or tight-fitting plugs, you know where the blame lies. There are specific standards, these standards are mandatory and yet, there are manufacturers who are violating these standards with impunity.
In fact in the last seven years, tests conducted by consumer groups have time and again highlighted the urgent need for better implementation of the Order. In 1994, for example, CERC tested eight brands of 16 ampere, 240 volt domestic switches and found them all to be substandard. Subsequent tests on electric irons in 1976 and more recently, immersion rods, have also highlighted the indifferent attitude of the law enforcement agencies to measures meant to protect the interests of consumers.
If the Quality Control
oder was new, then may be one could have blamed it on the
initial teething problems, but the governments
attempts at ensuring quality control spans over 24 years!
In fact, when the Government first passed the Household
Appliances (Quality Control) Order way back in 1976, it
had brought 41 items under compulsory quality control.
Subsequently, for various reasons, the Order underwent
modifications thrice: in 1981, 1988 and subsequently,
1993. While the 1981 Order reduced the number of items
under quality control to 40, the 1991 order brought it
down to only seven. The 1993 Order covers these seven
items besides wires and cables. While describing the need
for bringing these items under mandatory ISI
certification, the Government had pointed out at that
time that the use of sub-standard components and lack of
quality control can endanger the life and limbs of the
user. But unfortunately, such concern for consumer safety
has not translated into stringent implementation of the
by K.R. Wadhwaney
Sahara, Jet Airways increase fleet
The operation of Indian Airlines (IA) flights continues to be rather erratic as there has not yet been proper understanding with engineers. The engineers continue to be on go slow tactics to press their demands.
In fairness, the engineers should have had a dialogue with the management before resorting to agitation which is not justified. They are already adequately paid, and if they need some raise in their salaries and perks, they should have gone about in a proper way instead of holding management and passengers to ransom.
The holiday season is about to commence and agitation will put needless pressure on the management. Of the 35,000 passengers, Indian Airlines share is about 20,000 while the remaining 15,000 passengers are uplifted by Jet Airways and Sahara. Both private operators have increased their fleet and continue to do so to gain further share in the passenger market.
Despite manifold problems faced by the private operators in the existing scenario, both Jet Airways and Sahara have already evolved several schemes to woo passengers. Their services are more than satisfactory.
One may blame engineers for needless tough stand, the management cannot be held unblemished. The authorities should have taken effective measures to see that unrest in any vital sector does not creep in. Any unforeseen trouble in IA will be effectively exploited by the private operators.
According to Jet Airways Chairman Naresh Goel clientele with his airline has been steady and regular passengers are loyal to the carrier.
The government continue to be indecisive on the augmentation of fleet for Air India and Indian Airlines. Whatever may be the cause for delay in buying new aircraft. Boeing and Airbus Industries continue to work diligently for securing orders. Both have huge establishments in this country.
Recently, there has been a change in the Boeing set-up in this country. Dr Dinesh Keskar has moved to Seattle as President of the Aircraft Trading. In his place has come Dr Suvendroo K. Roy.
Before leaving for
Seattle, Keskar said the Boeing had offered its latest
100-seater B-717-200 aircraft to the Indian Airlines for
short-haul operations. He said single-aisle plane had
been specifically designed for low-density routes with
high frequency and low operating cost per trip.
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