New Delhi, June 7
In a move aimed at giving greater functional autonomy to public sector enterprises, the administrative ministries have been divested of the powers to transfer any Director within the PSEs or its subsidiaries.

Any such transfer would now need the approval of the Appointment Committee of the Cabinet (ACC) headed by the Prime Minister, government sources said.

In 1994, the government had issued orders allowing the transfer of functional Directors within a PSE without reference to the ACC, provided their initial appointments were made by the committee.

Since then many instances have come to light of the arbitrary transfer of Directors within an organisation or its subsidiaries, the sources added. This was more pronounced in companies that had many subsidiaries.

Following an order by the ACC, the Department of Public Enterprises has issued guidelines that all transfers of Chairmen and Managing Directors within a company or between its subsidiaries or to another company would require approval of the Appointment Committee of the Cabinet even though they were initially appointed by the committee.

The order would be applicable to all PSUs that sign the memorandums of understanding with the government. — PTI 

New Delhi, June 7
A city consumer court has fined Citibank Rs 10,000 for harassing a person by sending him an unsolicited credit card and later sending him fake bills.

“Citibank is not following the RBI’s rules and regulations and the matter needs a probe,” said the District Consumer Dispute Redressal Forum, allowing the petition.

Mr Charanjit Singh, a resident of Tagore Garden, received a letter from Citibank on February 24, 2003, containing a free credit card. Later Mr Charanjit Singh contacted the bank through its helpline number and refused to accept the card as he was not aware of the terms and conditions of the card.

Citi Bank officials tried to convince him about the various advantages of it.

However, he did not accept the card and did not sign any documents. The bank on November 11, 2003, again sent him a free credit card without Mr Singh’s request and his knowledge. He again refused to accept the credit card and requested the bank to cancel it and made it clear that he was not interested in such free gifts. Despite his request to cancel the cards, the bank started sending him card bills showing first year fee, service charges, service tax etc.

He contacted the bank officials again and was told that the card was not activated and the bills sent to him were the minimum compulsory charges.

An aggrieved Singh then approached the forum and sought compensation worth Rs 4.9 lakh. He produced the last bill dated April 18, 2005, for Rs 2,996 to the court.

The court questioned Citibank as to why Mr Singh should pay for a card which he had neither demanded nor signed any documents related to it.

The bank said that the card was re-issued only after Mr Singh’s consent. “However no documentary proof in this regard is available,” the forum observed, rejecting Citibank’s contention and held it liable for harassing Mr Singh. — PTI

New Delhi, June 7
India has been ranked fourth most attractive investment country in the world as well as the most preferred location for call centres and back office functions, according to the Ernst & Young European Attractiveness Survey, 2006, released today.

India's rating in 2006 is at par with the previous year, with 18 per cent of investors citing it as a key choice. However, the survey —'Globalisation Act II: team Europe defends its goals' — says the country shows few signs of being able to compete with China as an FDI destination.

India also figured at number five among the top 10 countries for research and development (R&D) centres. It was placed after the US/Canada, Germany, United Kingdom and France. China and US remain the top two preferred countries for international decision-makers with 41 per cent votes.

Whilst remaining attractive, China's pull has considerably reduced since the European Attractiveness Survey 2005 (52 per cent).

While SMEs are most attracted by China (46 per cent), there has been a decline in the level of interest expressed by multinational corporations — 38 per cent, compared with 58 per cent a year earlier.

While China achieves the lead position for manufacturing operations with 18 per cent votes, India has emerged the top country for call centres with 14 per cent. However, the survey findings indicate a 8 per cent fall in India's attractiveness for call centre functions. Germany, US/Canada follow India with an 11 per cent share.

The results of Ernst & Young's 2006 Attractiveness Survey reflects the maturing of the location decision-making process, and analysis of the criteria used by senior executives in selecting locations for investment projects reveals that their decisions can be divided into three categories — operations, finance and business environment.

The survey indicated that ranking of location criteria by multinationals and SMEs not only reflects the complexity in making these decisions, but also the leading role of ''quality'' or ''soft'' factors over direct ''bottom line" factors. This somewhat contradicts the conventional perception that all location or relocation issues are based solely on cost and tax factors.

The quality of the infrastructure, proximity to markets and the quality of the workforce were rated by corporate executives as ''very important'' in assessing a potential location. — UNI

Hyderabad, June 7
The Centre will soon announce a policy for the promotion of semiconductor industry which is expected to witness a major boom with the country’s first silicon chip- manufacturing facility being set up near Hyderabad.

“We will announce the policy with special package of incentives to boost the semiconductor sector,” Union Minister for Communications and Information Technology Dayanidhi Maran said here today.

He was speaking at a function organised to unveil the foundation stone for the $3 billion Fab City, billed as India’s first wafer fabrication hub. The project is coming up on a 1,200-acre site at Tukkuguda near the proposed international airport on the city outskirts.

Expressing the government’s resolve to put the country on the global semiconductor map, Mr Maran said Indian domestic electronics market was expected to consume about $40 billion worth of semiconductor components by 2015 while the global consumption would touch $350 billion.

The minister also disclosed that the Centre was also in the process of working out a policy for the electronics and IT hardware manufacturing industry. The Prime Minister’s Office had set up a task force to make suitable recommendations.

Chief Minister Y.S. Rajasekhar Reddy, who formally unveiled the foundation stone, said the first phase of the Fab City would become operational within 18 months. The facility is expected to provide employment to over 10,000 persons, besides promoting ancillary units.

The Fab City, to be implemented in three phases, would have a capacity to produce about 25 million chips per year. The MoU for setting up the facility was signed in February this year between the Andhra Pradesh Government and Sem India, a consortium of overseas Indians. 

New Delhi, June 7
The three-year bull run across global markets might be over, giving way to a full-fledged bear market, leading equity research firm Morgan Stanley has warned in its latest report.

Sensex dropped more than 250 points today to close below the key 10,000 point mark for the first time since February 17.

Sensex plunged more than 13 per cent last month, tracking sluggish trends across the global markets and on concerns that FIIs have started offloading their position from the country on look out for better returns from other markets

Morgan Stanley’s Hong-Kong based economist Andy Xie said in a report published today that the four-year global growth boom might be over, as the liquidity boom and asset inflation were nearing an end.

The liquidity boom had been manufacturing strong growth through asset inflation — including property, credit spreads, commodities, and emerging market stocks.

However, as inflation picks up, the liquidity boom and asset inflation would draw to a close, Xie said.

Morgan Stanley said that massive fund flows from the “less experienced retail investors into hot-concept funds like BRIC, commodity, India, China” had led to a global financial mania in the past five quarters.

When markets are hot, fund managers tend to market their funds aggressively, especially those ones with hot concepts, Xie said. Tens of billions of dollars have been raised by such funds from less experienced retail investors over the past three quarters in markets like Japan, Korea, Taiwan, while fuelling rapid price appreciation in the recipient markets.

However, inflationary pressure in the US and other OECD economies makes a cyclical bear market likely beyond the ongoing unwinding, the report said.

Morgan Stanley said that the central banks in the US and other OECD countries were likely to further hike the interest rates and keep them higher for longer than expected.

A Morgan Stanley economist said that a financial hard landing was the most likely conclusion of the current bull market, while an economic soft landing was also possible.

The emerging equity markets and commodity markets have been among the major recipients of funds from long-term investors who had failed to generate big returns in the US. However, such funds had flowed disproportionately into small and illiquid stocks, causing them to rise multiple times, Xie said.

Xie said that the cyclical bear market in 2001-02 cleaned the excess capacity in the IT sector while the excess liquidity flowed into emerging markets and commodities. 
— PTI 

Bangalore, June 7
The Union Science and Technology Minister, Mr Kapil Sibal, said today that the Centre had cleared norms for the establishment of SEZs for the bio-technology (BT) sector.

Disclosing this here while inaugurating sixth edition of "Bangalore -Bio", the minister said companies having 10 hectares of land and a built-up area of 4 lakh sq ft could be part of a SEZ. He said this decision had been taken by an Empowered Committee and all companies setting up shop under the laid down specifications would be eligible for the relevant excise and weighted tax options.

Stressing on the need to spend more on research and development (R&D) in the biotechnology sector, he said at present BT companies in India were spending only 1 per cent of their revenue on R and D whereas multinationals were spending upward of 7 to 8 per cent on R and D.

Mr Sibal said India was destined to become a BT hub due to combination of low-cost economics and high-value human resource and added India could easily beat China on this count

New Delhi, June 7
In a move aimed at making the system more consumer-friendly, the Telecom Regulatory Authority of India (TRAI) today directed all telecom access providers to include the credit limit set for post-paid customers in their monthly statement/bill on a regular basis.

The authority took the step after it received numerous complaints of the hardships and inconvenience caused to the subscribers on account of disconnection of service or barring of calls when the usage exceeded the credit limit decided by the operators, a release said.

TRAI had issued a direction on June 27, 2005, to all access providers laying down certain system and procedure in respect of credit limit for post-paid subscribers.

One of the conditions mandated in the direction was that the credit limit set for the post-paid subscribers should be intimated to the customers in advance.

Meanwhile, it has released the proposed amendments in the Cable Television Networks (Regulation) Act, 1995 and the existing Telecom Licenses for facilitation of growth of IPTV services in the country.

The amendment aims to allow viewers see television programmes in their computers using Internet connection.

New Delhi, June 7
The World Environment Foundation will honour Orient Paper Mills with the ‘Golden Peacock Environment Management Award’ for using environment- friendly techniques in carrying out industrial activities.

A 10-member jury headed by former Chief Justice of India P.N. Bhagwati adjudged Orient Paper as the recipient of this year’s award.

The award lays emphasis on maintaining ecological balance by minimising adverse environmental impact while carrying out industrial and business activities. — PTI

Mumbai, June 7
Tata Tea Ltd has posted a decline in net profit at Rs 19.32 crore for the January-March quarter, compared to Rs 25.83 crore for the corresponding quarter in 
2004-05.

Total income stood at Rs 243.53 crore for the fourth quarter in 2005-06 whereas the same was Rs 249.36 crore in the year-ago period, the company said.

The Board has recommended a dividend of Rs 12 on shares of Rs 10 each (120 per cent).