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THE TRIBUNE SPECIALS
50 YEARS OF INDEPENDENCE

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B U S I N E S S

FM for consensus on financial reforms
Kolkata, December 6
The Finance Minister, Mr P. Chidambaram, today said a political consensus was required to speed up financial sector reforms, especially in pension and insurance.

General insurance tariffs set to go up
New Delhi, December 6
The insurance regulator, IRDA, has announced withdrawal of tariff structure fixed by it for general insurers from January 1, 2007, paving way for them to decide premium rates for their products.

A visitor sits at a China Unicom's booth A visitor sits at a China Unicom's booth on the third day of the International Telecommuni- cation Union Telecom World, 2006, in Hong Kong on Wednesday. — Reuters

Maruti reigns northern India
Chandigarh, December 6
Maruti continues to roll up the popularity charts in this part of the region with 61 per cent of the market share in the middle “A-2” segment.

Underground LPG facility coming up at Vizag
HPCL lines up Rs 10,500 cr for expansion
Visakhapatnam, December 6
Taking a big leap towards the energy security of the country, the first underground mined rock LPG cavern project here will be completed by June 2007.

Wal-Mart pinch: Reliance Retail eyes acquisitions
New Delhi, December 6
Reliance Retail, already creating ripples in the organised domestic retail market, is poised to acquire smaller rivals in order to take on serious competition from the likes of Bharti-Wal-Mart combine.


An employee of Lenovo Japan displays a new "ThinkPad X60 Tablet", equipped with an Intel's core duo processor and a new 12.1-inch XGA multi-touch LCD display
An employee of Lenovo Japan displays a new "ThinkPad X60 Tablet", equipped with an Intel's core duo processor and a new 12.1-inch XGA multi-touch LCD display, which operates with a digitiser stylus, in Tokyo on Wednesday. Lenovo will put it on the market at the end of this month with a price of 248,000 yen ($2,200). — AFP


EARLIER STORIES

 
Air-India inducts new aircraft
No action against air surcharge: Patel
New Delhi, December 6
Air-India (A-I) today inducted a brand new aircraft to its fleet after a gap of 10 years, and said it planned to induct a fresh batch of pilots keeping future deliveries in mind. A-I received the first of its planned order of 68 Boeing jetliners and inducted a brand new 737-800 for Air India Express. The new aircraft has an all-economy class configuration with a capacity to seat 180 passengers.





An airport security guard stands under the tail of an A-I Express Boeing at the welcome celebration of the delivery of Boeing 737-800 for Air-India in New Delhi on Wednesday. — AFP photo
An airport security guard stands under the tail of an A-I Express Boeing at the welcome celebration of the delivery of Boeing 737-800 for Air-India in New Delhi on Wednesday.

Arcelor Mittal to hive off German plant
London, December 6
Global steel maker Arcelor Mittal today said it would sell its German steel plant to a Spanish company for Euro 591 million as part of committments to address anti-trust concerns of European regulators.

Toshiba to enter Indian mobile market
Hong Kong, December 6
Buoyed by the growing wireless market in India, Japan-based electronics and technology major Toshiba is planning to tap the country's mobile segment by the end of this year.

Bridgestone to buy US Co for $1 billion
Tokyo, December 6
Tyremaker Bridgestone said it would purchase Bandag Inc. of the United States for $1.05 billion. The US arm of the Japan-based Bridgestone will purchase the Iowa-based company, a leading manufacturer of tyre retreading materials and equipment, Bridgestone said in a statement released late yesterday.

Tata Steel-NYK Line form jv
Jamshedpur, December 6
Tata Steel and Nippon Yusen Kabushiki Kaisha (NYK Line), has entered into a joint venture agreement for setting up a shipping company to cater to dry bulk and break bulk cargo. Tata Steel and NYK will each hold 50 per cent stake in the joint venture company. The agreement was signed yesterday by Mr Hiromitsu Kuramoto, Representative Director and Senior Managing Corporate Officer, NYK Line and Mr B. Muthuraman, MD, Tata Steel.

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FM for consensus on financial reforms

Kolkata, December 6
The Finance Minister, Mr P. Chidambaram, today said a political consensus was required to speed up financial sector reforms, especially in pension and insurance.

"In the past two years, the reform in financial sector had been slow. It has to be quickened now," Mr Chidambaram said at a function of National Insurance Company here.

Underscoring the need for pension reforms, he said: "We have to finish the unfinished work in this sector to carry forward the financial sector reforms."

He said India was the only country where the working population was increasing. "This will continue till 2040. After that, the ageing population will start rising," he said.

The Finance Minister's comments come as the two key legislations — Pension Fund Regulatory and Development Authority Bill and an amendment in Insurance Act to increase the FDI cap — are yet to be cleared for lack of consensus among political parties.

Mr Chidambaram said the insurance sector was in a nascent state and the premium collection by all non-life insurance companies put together accounted for only 0.65 per cent of GDP against a global average of 3.43 per cent.

Citing data, Mr Chidambaram said, ''out of 1.1 billion people, only 4 crore are covered under the non-life insurance sector which is basically very small compared to other parts of the globe.

There is a vast scope to tap this sector and business can boom if the percentage is enhanced.''

Mr Chidambaram stressed the need for growth in the insurance sector and urged political parties to ensure that the government could go ahead with reformation.— Agencies

Be ready for consolidation, banks told

The Finance Minister today asked the banks to advance more credit to farmers, entrepreneurs and the government for supporting economic growth.

"Bank credit has to grow to support economic growth. Banks have to advance more credit to farmers, entrepreneurs, students and the government," he said while inaugurating United Bank of India's Internet banking service here.

"The country's economy is growing at the rate of 9 per cent. But the heart of economy is finance," he added.

He also advised banks to follow the three 'mantras' — competition, convergence and consolidation.

Observing that the banking industry was doing well, he said there was a long way to go in terms of acquiring size and strength.

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General insurance tariffs set to go up

New Delhi, December 6
The insurance regulator, IRDA, has announced withdrawal of tariff structure fixed by it for general insurers from January 1, 2007, paving way for them to decide premium rates for their products.

The regulator has also fixed maximum commission rates to be paid to agencies and brokerage house in the new regime.

Terms, conditions and regulations applicable to fire, engineering, motor, workmen’s compensation and other classes of business currently under tariffs would be withdrawn effective from January 1, 2007, the IRDA said in a circular. However, in motor third party insurance, companies would be denied flexibility as the IRDA notified new premium rates, which are higher by 33-257 per cent.

The insurers would be barred from replacing the current policies with new ones just to alter the rates of premium.

The IRDA has fixed maximum commission for agencies in the case of fire and engineering insurance in the range of 5-10 per cent of the premium depending on the individual and corporate clients. — PTI

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Maruti reigns northern India
Saurabh Malik
Tribune News Service

Chandigarh, December 6
Maruti continues to roll up the popularity charts in this part of the region with 61 per cent of the market share in the middle “A-2” segment.

As many as 60,000 Maruti cars roll out of the showrooms in Punjab, Haryana and Himachal Pradesh, along with Jammu and Kashmir, annually. Out of the total, 40,000 cars are in the “A-2” section. These include Alto, Zen and Wagon-R.

Statistically speaking, the company is doing better in this part of the region in the “A-2” sector compared to the rest of the country. The company’s all-India share in the segment is 57 per cent. Santro and Indica Xeta are the rival cars in the same category.

Talking to The Tribune at the regional launch of Zen Estilo here, Mr R.S. Kalsi, MUL’s Delhi-based Chief General Manager, Commercial Business Head (North), said the company was expecting to further improve the figures by wheeling out the new car in the market. As of now, the company is registering a growth of 11 to 12 per cent in the North, compared to all-India figures of 17 per cent.

He said only petrol variant of Estilo would be available. “Though we are setting up a diesel plant in Manesar for other models, we have no plans of launching Zen diesel,” he asserts.

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Underground LPG facility coming up at Vizag
HPCL lines up Rs 10,500 cr for expansion
Ruchika M. Khanna
Tribune News Service

Visakhapatnam, December 6
Taking a big leap towards the energy security of the country, the first underground mined rock LPG cavern project here will be completed by June 2007.

With this, India will be among the select band of countries to have LPG storage facility housed at 162 m below mean sea level. This is the first of its kind project in South and South-East Asia, and there are just 80 such facilities in the world.

The Rs 333-crore project is being implemented by South Asia LPG Company (SALPG), a 50:50 joint venture between Hindustan Petroleum Company Limited and TOTAL, French oil major.

Talking to mediapersons here today, Mr Rajan K. Pillai, Deputy Chief Executive Officer of SALPG, said the natural settings of the location made the project unique.

“The project is being constructed by Larsen and Tourbo, on a lump sum-turnkey basis for building both underground and over-ground facilities.

While Rs 100 crore is equity based, the balance is being funded by a consortium of banks led by the SBI,” he said.

The storage facility is made up of two caverns of size measuring 19 m in height, 20 m in diameter and 160 m in length. The caverns are located 162 m below sea level, under solid hard rock and will hold 60,000 MT of LPG. Apart from being fully safe from natural calamities and hazards like sabotage and aerial bombings, it would be leak and fireproof.

The caverns are jacketed with natural water curtains on three sides. There will be two pipelines to handle butane and propane separately at the berth. Five booster pumps on the shore will add up to the onboard pumps to facilitate the discharge at the required rate of 1,000 MT per hour.

An over-ground facility has been constructed to blend the two gases online and convert it to LPG. The existing HPCL pipeline will be used to transport LPG to the HPCL’s bottling plant, and the pipeline of GAIL will also be used to facilitate direct discharge in Hyderabad.

Meanwhile, HPCL has also launched work to expand its capacity to 15 million tonnes per annum. The project will involve a total investment of Rs 8,300 crore and it will be completed by 2010, said HPCL General Manager and in-charge of Visakh Refinery, Mr A.S. Rao.

It is proposed to set up mixed xylenes production, augmentation of propylene production and deepwater offshore crude import facilities.

HPCL is also investing Rs 2,200 crore on clean fuel project for producing Euro-III compliant petrol and diesel. The expansion is part of a fast-track project following the decision of the Government of India to promote Visakhapatnam into one of the petroleum, chemical and petrochemical investment regions (PCPIR).

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Wal-Mart pinch: Reliance Retail eyes acquisitions

New Delhi, December 6
Reliance Retail, already creating ripples in the organised domestic retail market, is poised to acquire smaller rivals in order to take on serious competition from the likes of Bharti-Wal-Mart combine.

The Mukesh Ambani-spearheaded venture is bidding to buy out smaller competitors such as Adani Retail and also has plans to gobble up other well-known brands.

“Reliance is the highest among three bidders for Adani and is looking at all others,” an industry source familiar with the development said, but did not elaborate on the proposed Adani takeover.

Adani has a network of over 50 retail stores, which includes formats ranging from neighbourhood stores to supermarkets in Gujarat.

Sources said the inorganic growth route suited Reliance’s plans, which includes rolling out 300 stores by this year and another 4,000 in three years.
When contacted, a Reliance Industries spokesperson declined to comment on the company’s acquisition plans.

Since unveiling Reliance Fresh, its first retail format store that sells vegetables, fruits and groceries in Hyderabad last month, the company has added 16 more outlets to the pilot project in that city. Plans are afoot to roll out Reliance Fresh in four other cities, including Delhi, this month. — PTI

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Air-India inducts new aircraft
No action against air surcharge: Patel
Tribune News Service

New Delhi, December 6
Air-India (A-I) today inducted a brand new aircraft to its fleet after a gap of 10 years, and said it planned to induct a fresh batch of pilots keeping future deliveries in mind. A-I received the first of its planned order of 68 Boeing jetliners and inducted a brand new 737-800 for Air India Express. The new aircraft has an all-economy class configuration with a capacity to seat 180 passengers.

“The last induction of a new aircraft was in 1996 when we had Boeing 747-400 and we have been struggling with old aircraft. With today’s induction of a brand new Boeing 737-800 for our sister concern Air-India Express and the deliveries to come in the next few months, we are preparing ourselves a force to reckon with in the global aviation space,” A-I Chairman and Managing Director V Thulasidas said.

Speaking on the occasion, Civil Aviation Minister Praful Patel said the government would not take any action against major private airlines for imposing an air traffic congestion surcharge on all fares, but said that such a step was unacceptable.

“I am completely in disagreement with the decision to hike fares in the name of air traffic congestion. If they (airlines) wanted they should have simply hiked the fares”.

The minister also said that after the India-Air-India merger there would be two airlines run in the public sector category. One would be high priced airline while the other low cost one like Air-India Express, which is the subsidiary of A-I.

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Arcelor Mittal to hive off German plant

London, December 6
Global steel maker Arcelor Mittal today said it would sell its German steel plant to a Spanish company for Euro 591 million as part of committments to address anti-trust concerns of European regulators.

The world's largest steel company will sell Stahlwerk Thringen GmbH (SWT) long steel carbon plant to Spain's Grupo Alfonso Gallardo for an enterprise value of Euro 591 million.

The sale is the first in a series of three similar deals to be carried out by Mittal Steel as it had earlier committed to European Commission during its Euro 26 billion merger agreement with Arcelor earlier this year. "Stahlwerk Thringen is a high quality facility and I am delighted that this transaction fully values its potential," Arcelor Mittal CFO Aditya Mittal said.

Grupo Alfonso Gallardo is Spain's largest corrugated steel manufacturer with sales in excess of Euro 2.3 billion in 2006. The privately-owned company operates steel plants in Spain and diversifies in cement production and oil refining. — PTI

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Toshiba to enter Indian mobile market

Hong Kong, December 6
Buoyed by the growing wireless market in India, Japan-based electronics and technology major Toshiba is planning to tap the country's mobile segment by the end of this year.

"India is a very large market for us and is growing very rapidly. Japan has already achieved 70-80 per cent mobile penetration, which is forcing us to look overseas to meet our corporate demands," Toshiba Corporation International Operations Division Deputy Manager Takeshi Aoki said on the sidelines of the ITU conference here.

The company is looking to tap the mobile market in India, Hong Kong, Taiwan and the European countries, he said.

"We will initially launch one GSM mobile handset in India within a few weeks, which would be marketed and distributed by the company along with a UK-based trading company in the country," Mr Aoki said, adding that subsequently the firm would roll out other phones. — PTI

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Bridgestone to buy US Co for $1 billion

Tokyo, December 6
Tyremaker Bridgestone said it would purchase Bandag Inc. of the United States for $1.05 billion. The US arm of the Japan-based Bridgestone will purchase the Iowa-based company, a leading manufacturer of tyre retreading materials and equipment, Bridgestone said in a statement released late yesterday.

"Retreading" is widely used for truck and bus, aircraft, construction and off-highway tyres, Bridgestone said.

"The retread business is well established in the United States and European markets, and is becoming more attractive to fleet operators in emerging markets such as Asia and Latin America," it said.

Bandag has a global network of more than 900 franchised dealers in over 90 countries that produce and market retread tyres and provide tyre management services, the Japanese firm said. — AFP

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Tata Steel-NYK Line form jv

Jamshedpur, December 6
Tata Steel and Nippon Yusen Kabushiki Kaisha (NYK Line), has entered into a joint venture agreement for setting up a shipping company to cater to dry bulk and break bulk cargo. Tata Steel and NYK will each hold 50 per cent stake in the joint venture company. The agreement was signed yesterday by Mr Hiromitsu Kuramoto, Representative Director and Senior Managing Corporate Officer, NYK Line and Mr B. Muthuraman, MD, Tata Steel.

Mr Muthuraman said in future Tata Steel would require transporting large quantities of raw materials and finished steels, which necessitated strategic control over logistics. — UNI

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BRIEFLY

EPF Board meets today
New Delhi, December 6
The Central Board of Trustees of Employees Provident Fund (EPF) will meet here on December 7 to decide on the interest rate for its four crore subscribers in 2006-07. "The CBT will meet tomorrow to discuss the agenda, which could not be completed on November 7," Labour Ministry sources said today. Labour Minister Oscar Fernandes is the ex-officio chairman of the EPF Board. The Board at its last meeting, held on November 7, had put off a decision on fixing interest rates for 2006-07 as it had not calculated the surplus funds available. — PTI

Vodafone keen to up stake in Bharti Airtel
London, December 6
Britain's Vodafone Group Plc said today it was keen to increase its presence in India and China, where it holds minority stakes in local operators. ''These are markets we would seek to increase our exposure (to) over time whether by direct increase of our stake, which may be the case in India, or by accessing other mobile-reated growth areas which is more likely to be the case in China,'' Vodafone's Chief Executive for its EMAPA emerging markets business, Mr Paul Donovan, said. Vodafone owns 10 per cent of India's top mobile operator Bharti Airtel. — Reuters

Cisco plans
New Delhi, December 6
US network equipment maker Cisco Systems Inc has said it will launch a pilot manufacturing facility in India and triple headcount to 6,000 as part of strategy to draw 5 per cent of its global revenue from the country over the next two to three years. “The facility in Chennai will manufacture Internet protocol-based phones for the Indian and export markets. In line with the company’s outsourced manufacturing model, we have selected one of its global partner Foxcon to work on the facility,” Cisco CEO John Chambers said after meeting IT Minister Dayanidhi Maran. Cisco has also made India as the site for its globalisation centre, a reflection on India being elevated to Cisco’s global strategy paradigm. — PTI

Reliance Hello
Mumbai, December 6
Reliance Communications today announced the launch of Reliance Hello unlimited onnet STD offer. With a monthly rental of Rs 1,500, Reliance subscribers opting for this innovative offer, will be able to make unlimited calls to any Reliance phone anywhere in India absolutely free, a Reliance release said here today. This offer with a choice of post-paid or pre-paid payment options will be available to Reliance Hello subscribers in the telecom circles of Delhi, Mumbai, Chennai, Punjab and Himachal Pradesh.— UNI

ONGC contract
New Delhi, December 6
ONGC has awarded a $388.19 million contract to Abu Dhabi-based National Petroleum Construction Company (NPCC) for the development of C-Series field in Mumbai High. “We signed the contract with NPCC last month,” said a senior ONGC official. The project involves survey, design and detailed engineering, procurement, fabrication, installation and commissioning of the four unmanned well platforms, and coating and laying of 180 km of pipeline, and carrying out modifications on the existing NQG process platform at Mumbai High. The project is to be completed by April 20, 2008. — PTI

Birla Sunlife MF
Mumbai, December 6
Birla Sunlife Mutual Fund has picked up a 2.49 per cent stake in an electric motors and transformers maker, Bharat Bijlee, for Rs 16.62 crore through open market transactions. Birla Sunlife acquired 1,40,871 equity shares of Bharat Bijlee at a price of Rs 1,180 each. While Kotak Mahindra UK Ltd sold the company’s shares in a bulk deal on the BSE. — PTI

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