|Monday, May 8, 2000,
Inflation rises to 70-week high at
200 crore plan for fruit marketing
CHIANG MAI, Thailand, May 7 (Reuters) India should make some key decisions in the next two weeks on the sale of government equity in some state-owned entities, Finance Minister Yashwant Sinha said today.
I hope in the next 10 days to two weeks it should be possible for us to take some decisions. We have a long list of undertakings that are waiting for a decision, he told Reuters in an interview on the sidelines of an Asian Development Bank meeting he is attending here.
In the last week of April, Indias Cabinet had deferred a decision on government disinvestment in state-run firms pending further discussions on the plan by a Cabinet committee.
Five State firms, including Air India, which is 100 per cent government owned, and Indian Oil Corp, which is partially privatised, are among those for which the Cabinet is considering stake sales.
We are proceeding according to plan... in many cases we are looking for strategic partners, Sinha said without giving details.
However, he expressed confidence that Indian markets which have taken a knock in recent weeks on external factors should stabilise soon to accommodate disinvestment decisions.
World markets have been volatile and Indian markets have been responding. I hope that the Indian markets will stabilise now that I have announced more concessions in the budget, he added.
Sinha said foreign investors would not be excluded from participation in the privatisation within the norms that are there.
Re to be stable: The minister said he was also confident that the Indian rupee, which has been near all-time lows of 43.70 per dollar recently, would remain stable for the rest of the year.
I dont think that there is a cause for concern. The foreign exchange market has been behaving quite responsibly and the rupee gets adjusted according to the laws of supply and demand, he said.
We have comfortable foreign exchange reserves. There is nothing to worry about on the balance of payments front.... There might be some ups and downs. But on the whole the foreign exchange market will not be volatile, I think it will be stable.
Asked what would be a comfortable rupee level, he said: I wont hazard a guess.
Sinha also said that he saw the average 2000-01 (April-March) inflation rate at about 4 to 5 per cent, about the same as in the previous fiscal year.
Drought impact: He noted that the absence of rain in some parts of the country which had led to drought had some impact in terms of production losses but he was hopeful the monsoon coming in about six weeks would drench parched areas.
It has had some impact in terms of production loss, but in terms of food production we are very comfortable. There is no threat of any increase in the price situation, he added.
If you look at the inflation situation in India in the past few weeks, you would notice that the rate of inflation has gone up largely on account of increasing administered prices rather than on account of any shortage of supply, he said.
So while it is unfortunate that we have drought in some parts of the country, I think we should be able to manage, he added.
Thousands of activists on Sunday marched on the venue of the Asian Development Banks annual meeting in Thailand, shouting ADB get out. About 2,000 of the protesters clashed briefly with the Thai police near the main venue of the meeting in the northern Thai city of Chiang Mai.
The demonstrators demands included a halt to many ADB-funded projects such as dams which allegedly displace thousands of Thai farmers and a controversial $ 300 million loan that would introduce charges on water usage for new irrigation projects. DPA
A landmark currency cooperation agreement by 13 East Asian nations to fight future economic crises was welcomed cautiously on Sunday by the USA.
The top US official at the annual ADB meeting reacted positively to Saturdays deal between the East Asian nations to a swap plan to protect each others currencies in times of crisis.
NEW DELHI, May 7 (PTI) For the first time in 70 weeks, the annual rate of inflation crossed the 6 per cent mark to touch 6.10 per cent for the week ended April 22, on account of a sharp increase in electricity tariffs during the week.
This has been the highest inflation rate since 6.13 per cent in December 19, 1998.
During the week, the inflation rate, calculated on the basis of wholesale price index (WPI), rose by 0.55 percentage points to 6.10 per cent (provisional) from 5.55 per cent (P) the week before and 3.86 per cent a year ago.
The sharp increase in
inflation during the week has been on account of a 15 per
cent rise in electricity tariffs. Except for fuel, power,
light and lubricants, indices of both groups
primary articles and manufactured products - declined
during the week.
crore plan for fruit marketing
PATIALA, May 7 The Punjab Government has formulated a Rs 200 crore scheme for efficient marketing of fruits and vegetables.
Announcing this after laying the foundation stone of a 66 k.v. grid at Harahu village in Patran block of this district here yesterday, Capt. Kanwaljit Singh, Finance Minister, said if proper marketing system of fruits and vegetable crops is not provided, farmers would not deviate from producing wheat and rice.
The scheme involves setting up of cold stores as well as food packaging industries in the rural areas so that the farmers may have a marketing facility at hand and not incur losses by selling their produce at lower rates for fear of perishing.
NEW DELHI, May 7 (PTI) Outstanding dues of the central power utility National Hydroelectric Power Corporation (NHPC) have touched a staggering Rs 3,395 crore with the Haryana State Electricity Board (HSEB) topping the list.
About 19 States have to pay NHPC Rs 3395 crore including a surcharge of Rs 1523.84 crore as on March 31, 2000, NHPC Director (Finance) R. Natarajan told PTI here.
Haryana tops the list of defaulters with outstandings running over Rs 831.86 crore which includes a surcharge of Rs 446.31 crore.
Delhi Vidyut Board owes NHPC over Rs 434.99 crore, including a surcharge of Rs 207.79 crore, while the Punjab State Electricity Board (PSEB) had to pay Rs 254.94 crore, including a surcharge of Rs 140.09 crore, he said.
opens jewellery boutique in Paris
PARIS, May 7 Nearly a thousand years after the first Indian traders arrived in European courts carrying the worlds best pearls, an Indian is trying to recapture the same market. Only this time round the pearls are not from India alone but from all over the world.
Leading the Indian charge on the worlds most glamorous luxury market is 50-year-old Vidhan Chaudhari, President of Chaudhari Jewellers based in Kobe, Japan.
Chaudhari has formed a French company, Chodhari Joailliers, which will open the doors of its first showroom which required an investment of over $2 million to customers in Paris on May 8.
This is, incidentally, the first time an Indian company has ventured into the highly competitive business of luxury goods or jewellery in Paris, home to some of the biggest players in the market.
The boutique, which is well located in the heart of the chic sixth district of Paris, will stock a limited number of designs in order to preserve its exclusive nature.
We will have about 10 designs at most. We dont want to clutter the boutique with too many items and we also want to maintain our exclusivity, says Chaudhari, who has himself been involved in some designs that will go on display in Paris. The price tag, too, will display exclusivity, though Chaudhari refuses to spell out the prices now.
The Chaudhari family began its pearl business almost 60 years ago in Mumbai under the name Sikharchand and Shreechand. The family used to import pearls from various countries. However, as the import licences were restricted, it depended on the importers for its raw materials.
So one day my father got tired of the importers and decided to go out and look for the pearls himself. He arrived in Japan and, as destiny had it, he just decided to stay on, recounts Chaudhari.
Part of the reason for moving to Japan was also changing government policies in the late fifties that were making business harder, he says. The government was becoming increasingly anti-business and there was no ambience, no atmosphere in which private businesses could prosper. So we decided to move on, he adds.
The Chaudharis then set up shop in Kobe where they have stayed since. Today, Chaudhari is one of major suppliers of pearls to branded names like Niki Moto across the world. And the business has reached a turnover of over $30 million.
But Chaudhari says he does not want to set his sights too high. We dont want to be in the top 10. We want to be big, but not that big, he says.
Chaudhari has a significant investment in Vietnam, where his company grows most of its pearls. The company also has a small retail outlet in Kobe, but the focus has not been on individual customers.
For decades, Chaudhari has been a wholesale supplier to the big brands, but three years ago, the company began branching out into the retail market. In February 1997, it opened an outlet in Singapore which is targeted to the markets in India, Indonesia and Australia.
He says he chose Paris as the launching board for his companys foray into the West due to the image of the city as the global centre of cosmetics and branded jewellery. All the big brands are here. So we also want to be here. New York or London do not have the same charm and appeal that Paris has for the luxury industry, he says.
Moreover, all the people who are our target customers are regular travellers and often come to Paris. So they can buy their goods from us here, he adds.
Though he is interested
in Indian consumers, Chaudhari does not want to open any
outlets in India. There are far too many problems
in India, especially in the gems and jewellery business.
So we prefer to stay out. Moreover, our resources are
limited and we cannot open outlets everywhere. We hope to
sell to our Indian clients from the Paris boutique,
he says. IANS
import curbs hits units
MOGA, May 7 With the lifting of quantitative restrictions on the import of 1,429 items, the fate of the small scale industry in the district has been eclipsed.
Small manufacturers, especially those producing farm implements, here felt that the Governments deal with the WTO lifting restrictions on these items will wipe them out. Furniture and truck body makers will be the next casualties. These manufacturers, who are already hard pressed with the rising cost of production, fear that they may not be able to compete with multinationals if they enter the market.
Their fear stems from the fact that the outsiders are better placed to manufacture quality products at cheaper rates. This is primarily on account of their incapability to meet the challenges from advanced industrial technology.
Initially, there were about 450 units manufacturing farm implements in the area. Their number has squeezed to almost 100 due to adverse economic conditions and is likely to go down further, if the WTO deal prompts multinationals to invest in the industry.
The WTO deal will certainly finish us off the President of the Moga Agro Industries Association, Mr Jatinderpal Singh Khanna, said adding that We are not in a position to compete with the multi-nationals. He said the move might render over 7,000 labourers engaged in the industry unemployed.
The General Secretary of the association Harmel Singh suggested that the Government should also safeguard the interests of local manufacturers by restoring the supply of subsidised iron that was earlier suspended. Electricity and carriage should also be made cheaper to reduce the cost of production. He also demanded that they should be allowed to freely export their product to Pakistan to put the industry back on rail.
Likewise, President of the Furniture Manufacturing Association, Darshan Singh pointed out that the popularity of quality furniture from abroad has already eclipsed the fortunes of local carpenters. The skilled labour in this sector will lose employment, as we cannot beat them (multinationals) on quality and price as well.
by R.N. Lakhotia
Q: I am retired ex-defence person. I have got my pension arrears under the apex court judgement of 83 which remained uncomplied in my case the pension arrears accumulated for the past 20 years. After a gap of 20 years, they realised the mistake and paid the lump sum arrears making calculation from 1.4.79 to 31.12.99. Pension sanctioning authority has authorised the pension disbursing authority that is the bank to make calculation for year after year then make the payment. The bank has paid me the pension arrears for the said period and has deducted the tax at source.
2. As the law abiding citizen, how the pension disbursing authority can deduct the income tax, when the arrears accumulation has resulted due to non-compliance of the court judgement by the pension disbursing authority. During my tenure of service my salary remained below the taxable limit. My yearly pension + DA is Rs 30,000 + pension arrears for the said period is Rs 70,000 and no other income from any other source.
3. I have no other income. Please let me know through your weekly column my tax liability & other schemes of tax rebate.
I have retired on 1st April, 76. In case I have to file return for 79 to 99. The minimum fees of income tax lawyer is Rs 2000 for one year and for 20 year it will be amounting to Rs 40,000. This will be cruel joke on the soldier. I will be victim of deficiencies of service by the government. Please let me know what is the remedy for it.
Sarvan Singh, Bathinda
Ans: You can take advantage of the tax benefit available u/s 89(1) in respect of arrear salary receipts. You can ask your employer to deduct tax by spreading the arrear income to different years. If there is no liability, then the tax could not have been deducted. If still you find the problem, you can move to the Central Board of Direct Taxes asking for relief in terms of Section 119 of the Income-tax Act, 1961. This will be just through an application. You need not spend exorbitant amount towards making payment to the lawyer. This can be done by you. In any case if you have a problem contact the Public Relations Officer, Income-tax Department of your area.
Q: I purchased plot for Rs 1,00,000 in June 1987. Availed housing loan as under:
1987 Rs 94000
I started constructing my house in November 1987. Have spent about Rs 70000 from salary. The house was completed in 1999. Now I have sold my house for Rs 12,65,000. Could you please be kind enough to question the following queries:
1. What is my capital appreciation?
2. What is capital gain and capital tax thereon?
3. What are the options available for me to chose to save capital gain tax?
Parvinder Singh, Jalandhar
calculation of capital gains and the tax on capital gains
payable by you will have to be done by reference to
computing the adjusted cost in terms of cost inflation
index specially when the house was completed during the
Financial Year 1987-88. The cost inflation index for
1987-88 was 150 and the cost inflation index for the
financial year 1999-2000 is 389. Accordingly in the first
stage please calculate the cost Inflation Index. The
option available for you to save tax on capital gains in
buying another residential house property as per section
54 of the Income-tax Act, 1961. It is also possible for
you to save tax if you make the investment of the entire
sale proceeds or the capital gains by taking advantage of
section 54EA or section 54EB of the Income-tax Act, 1961
in case the sale has been completed by 31.3.2000. In case
the sale has been effected on or after 1.4.2000, then
exemption u/s 54EC is possible. The last alternative is
to make payment of tax on capital gains @ 20 per cent.
by Ashok Kumar
HCL Infosystems prospects bright
Q: Please comment on the long-term prospects of Amtrex. Would it be advisable to stay invested in the shares thereof?
Incorporated in 1985 as an affiliate of the Sanjay Lalbhai group, the Ahmedabad based Amtrex Appliances Ltd. is considered among the leading players in the domestic airconditioner industry. With its key assets being innovative technology and a good market position, the company has grown in leaps and bounds and is at present bidding for the third position in the window split AC segment. It has a technical understanding with Hitachi of Japan and covers a range of cooling which extends from 0.75 tonne in the window segment to 30 tonne chillers. Since the company does not have manufacturing facilities for compressors, it sources these from Shriram Tecumesh, Kirloskar Copetand and Hitachi.
Amtrex claims to have a market share of 8 per cent in the packaged segment. On the financial front the company has fared satisfactorily over the years and its future plans include targeting the markets of the Middle-East and West-Asia. It also proposes to commence operations in Sri Lanka and Bangladesh. In view of these factors, the future prospects of the company appear satisfactory and existing shareholders could continue to stay invested.
Q: Would it be advisable to invest in the shares of Indal?
Indal, having an installed capacity to produce 1.7 lakh tonnes of primary metal, has essentially preferred to ride on the downstream segments of aluminium. It has been due to this as well as on account of the absence of infrastructure and captive power plants, the company has been forced to look up to its competitors in the domestic sector or on imports for its requirements of primary aluminium.
Until recently the landed cost of imported metal was cheaper than outsourcing the same from domestic majors like Hindalco, Nalco etc., but the situation has changed for the worse in recent times thanks to the increase in Customs duty to 25 per cent on aluminium.
Thus, unlike other products who are into manufacture of primary metal for whom all these changes augur for the better, it has been a reverse case for Indal. Furthermore, this company has suffered heavily due to the heavy power cuts that it faced in its Alupuram, Kerala smelter as also at the Belgaum location.
While the company has been in the limelight following the takeover bid by Sterlite Industries, it has yet to pull up its socks and start delivering results. In view of this, a buy is not recommended for the shares of Indal, although its progress could be monitored in the medium term.
Q: How do you rate the future prospects of HCL Infosystems? Do you recommend a buy therein?
A part of HCL group, HCL Infosystems Ltd (HCLIL) is recognised as a leading information technology company. In fact, it can boast of a ranking of four among the information technology players. The company is engaged in computer software and hardware and provides value-added services in areas such as software applications. SAP implementation, networking consultancy and management, etc.
HCLIL enjoys the largest
installed PC base in the country, the same at 15,000
machines per month. On the financial front, the company
has an encouraging trackrecord to its name. The company
has recognised and consolidated its hardware and services
business, with a view to climbing up the ladder in the
global IT business. It has also set up alliances with
Microsoft, Intel, SCO and Novell, Toshiba, Oracle,
Sybase, etc. Continuing with the trend of efforts to
become a global force, HCLIL intends to set up
subsidiaries in the UK, the USA, Singapore and Malaysia.
promises to boost tourism
LUDHIANA, May 7 The Punjab Government will make all out efforts to develop places of tourist interest in the state in order to promote domestic and international tourism in a big way and adequate infrastructural facilities will be created for this purpose.
This was stated by Punjab Chief Minister Parkash Singh Badal while addressing the annual convention of the Hotel and Restaurant Association of Punjab here last evening.
He said that he had taken up the matter of setting up a ropeway to link Anandpur Sahib and the nearby Nainadevi temple with the Himachal Pradesh Chief Minister. If it could materialise, the site would emerge as a twin pilgrimage centre.
to set up mini farms
BATHINDA, May 7 Mr Sagar Kaushik, Managing Director, Aventis Cropscience, said today that his company will spend 10 per cent of the annual turnover on research and development to bring eco-friendly pesticides and insecticides in the market to boost the foodgrain production.
Addressing a press conference after the launch of the company, formed after the merger of AgrEvo and Rhone Poulenc Agro, Kaushik said the company will also set up helpline service centres and mini farms in Punjab to educate farmers in the latest techniques of agriculture.
holds power conference
CHANDIGARH, May 7 The Bhakra Beas Management Board has added 324 MW of power at a cost of Rs 195 crore by renovating, modernising and uprating its plants.
This was announced by the Union Minister of State for Power, Ms Jayawanti Mehta, at a national conference on hydroelectric projects organised by the BBMB at Nangal township today. The conference was attended by CMDs and other senior functionaries of various hydro power utilities of the country.
Mr V.K. Pandit, Secretary, Ministry of Power, commended the role of the BBMB in the development of the country. An exhibition was organised depicting achievements of the BBMB and a cultural light & sound programme was presented at Bhakra Dam by BBMB school children.
jewellers oppose ST hike
AMBALA, May 7 Haryana jewellers will launch a State-wide agitation if the enhancement of sales tax on bullion and ornaments recently imposed by the State Government is not withdrawn by May 31. This was decided at a meeting of the Haryana Sarrafa Association held here today in which around 200 jewellers from all over the State took part.
Association President Krishan Lal Malhotra, addressing the jewellers, said the State Government had enhanced the sales tax on bullion and its species from half per cent to one per cent while on ornaments it had been enhanced from 2 to 4 per cent. This enhancement was unreasonable, considering the rates prevalent in Punjab, Delhi and Himachal Pradesh.
An 11-member action committee was also constituted to decide the line of action. Mr Vipin Aggarwal, Secretary, Ambala Cantt Sarrafa Association, Sewa Ji Sarraf (Karnal), Om Prakash Singhal and Vijay Vindlas also addressed the meeting.
opens zonal office at Jammu
CHANDIGARH, May 7 The SBI today opened its zonal office at Rail Head Complex, Jammu. The new office was inaugurated by Mr S.R. Iyer, Managing Director & Group Executive (National Banking Group).
Mr S.M. Kapoor, Deputy
General Manager, Zonal Office, Jammu said the J&K
module of the bank has earned a profit of Rs 6 crore
during the financial year 1999-2000. Mr Prabhakar Sharma,
CGM, Chandigarh Circle, Mr D.L. Manwani, General Manager,
and Mr T.S. Bhattacharya, General Manager (Commercial
Banking) were also present.
After having been felled by the weight of some not too insignificant allegations by the RBI ICICI is again riding high.Why ? Because of its e-commerce thrust which is expected to give this DFI yet another fillip. Maybe this time around luck will favour ICICI.
A year ago ITC was a hot favourite at the bourses, but today there are very few investors willing to touch it even with a barge pole. The grapevine has it that India is one of the few developing nations where greater awareness level is minimising cigarette smoking. Bad times lie ahead for this tobacco major.
The biggest issue of the year and perhaps in recent times even will be that of a southern television channel. The grapevine has it that the lead managers are believed to be the culprits having overvalued the business of the channel grossly with an eye on enhancing their own share of the booty.
A smallish-medium sized IT company whose shares swung upwards even more rapidly than the rest of the market and which raised more than a few eyebrows by announcing its intention to list on the Nasdaq is now being hammered by members of a Calcutta bear cartel. Watch the action here!
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