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B U S I N E S S

Interest rates likely to go up 
RBI ups CRR by .5 pc to rein in prices

Mumbai, February 13
Concerned over the rising prices reflected in inflation shooting to a two-year high of 6.58 per cent, the Reserve Bank of India swung into a firefighting mode, unleashing measures to suck out about Rs 14,000-crore liquidity from the banking system — a move that could lead to higher interest rates for consumers.

Essar mulls legal action against Vodafone: Report 
London, February 13

Indian conglomerate Essar may start a legal battle against Vodafone, which is replacing Hutchison Telecom in the Indian mobile venture Hutch-Essar, on account of it being ignored in taking key business decisions, British media reported today.

Race for buying 43.5 pc stake in PTL hots up
Ashok Leyland, Sonalika also in fray
Chandigarh, February 13
The decks are all clear for the acquisition of the 43.5 per cent stake of PunjabTractors Limited (PTL). On the last day for the bids, as many as six top tractor companies have joined the race to acquire the company’s shares.

Bajaj unveils 200 cc Pulsar
New Delhi, February 13
Betting big on returns from the performance bike segment, Bajaj Auto Ltd said today it was targeting to cross the Rs 10,000-crore turnover mark this fiscal with sales of 2.8 million vehicles.
Mr Rajiv Bajaj, Managing Director, Bajaj Auto Ltd., poses with the newly launched 200cc Bajaj Pulsar DTS-i motor cycle in New Delhi on Tuesday.
Mr Rajiv Bajaj, Managing Director, Bajaj Auto Ltd., poses with the newly launched 200cc Bajaj Pulsar DTS-i motor cycle in New Delhi on Tuesday. — Tribune photo by Mukesh Aggarwal


Salman to endorse Mayur Suitings
With the three-decade-old textiles brand Vimal making a comeback to compete with rivals like Raymond and Reid & Taylor, RSWM Ltd —the name behind Mayur Suitings — has roped in Bollywood star Salman Khan as its brand ambassador.
With the three-decade-old textiles brand Vimal making a comeback to compete with rivals like Raymond and Reid & Taylor, RSWM Ltd —the name behind Mayur Suitings — has roped in Bollywood star Salman Khan as its brand ambassador. — TNS

 
Models pose with the FCX concept car at the 17th Engineering and Technology Fair in New Delhi on Tuesday. The fair is on till February 16.
Models pose with the FCX concept car at the 17th Engineering and Technology Fair in New Delhi on Tuesday. The fair is on till February 16. — A Tribune photograph

Bombardier, REL tie up for Chandigarh project
New Delhi, February 13
Canadian transportation major, Bombardier, is planning to participate in the rail and mass transit projects in the country in a major way and has tied up with Reliance Energy (REL) for Chandigarh Mass Transit project.

TCS opens JV in China
Beijing, February 13
India Inc. today took yet another great leap forward when IT conglomerate Tata Consultancy Services (TCS) launched a joint venture in China to scale up global operations and announced securing "a significant multi-million dollar" contract, the second major one, in the country within months.

Govt issues bonds worth Rs 11,200 cr
New Delhi, February 12
The government has issued bonds of Rs 5,000 crore for state-owned oil marketing companies and Rs 6,200 crore for Food Corporation of India.

Secys seek norms for studying FDI
New Delhi, February 13
A high-level Secretaries’ panel has asked the National Security Council, which started a debate on potential threat to national security from FDI in certain sectors and from certain countries, to prepare guidelines for areas to be watched.

Dabhol stake not on sale: Shinde
New Delhi, February 13
The government clearly said today that it would not sell any stake in Dabhol power plant's LNG import terminal.

Intel unveils super-chip technology
San Francisco, February 13
Intel has touted a diminutive new microprocessor which can deliver "supercomputer-like" performance to home computers and handheld devices.

Bank of Rajasthan ups term deposit rates 
Mumbai, February 13
The Bank of Rajasthan (BoR) said today it had revised the interest rate on its term deposits with effect from February 10.

RBI to study US demand for bank branches in India
New Delhi, February 13
The government said today the RBI would consider the US demand for relaxing the branch opening norms for foreign banks in India as per the roadmap prepared by it.

Manufacturing sector must grow at 15 pc: Nath
New Delhi, February 13
The Indian manufacturing sector must grow at a rate of 15 per cent per annum to achieve the target of 25 per cent share of the manufacturing sector in GDP from the current level of 17 per cent, Commerce and Industry Minister Kamal Nath said today.

 

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Interest rates likely to go up 
RBI ups CRR by .5 pc to rein in prices

Mumbai, February 13
Concerned over the rising prices reflected in inflation shooting to a two-year high of 6.58 per cent, the Reserve Bank of India swung into a firefighting mode, unleashing measures to suck out about Rs 14,000-crore liquidity from the banking system — a move that could lead to higher interest rates for consumers.

The RBI, which only last month hiked short-term lending (repo) rate by 0.25 per cent, today increased the cash reserve ratio by 0.5 per cent to 6 per cent to curb money supply and inflation.

The hike in the CRR, which refers to the percentage of funds that commercial banks are required to park with the RBI, would be effected in phases on February 17 and March 3.

This is the second instance in the past three months that the apex bank has raised the CRR. The previous hike of 0.5 per cent was also effected in two tranches — on December 23 and January 6.

The current move is expected to suck out Rs 14,000 crore of excess liquidity from the system.

Inflation had touched 6.58 per cent for the week ended January 27 and Finance Minister P. Chidambaram had expressed concern over the rising priceline, while maintaining that the government was determined to tackle it.

Mr R. Raghuraman, Executive Director of Punjab National Bank, the country’s second largest public sector lender, said both lending and deposit rates were likely to go up consequent to the hike in the CRR. “The profitability of the bank would be hit to a certain extent,” he said.

The apex bank during its third quarter review of the monetary policy had said that it would use all policy instruments, “including the CRR, to ensure the appropriate modulation of liquidity in responding to the evolving situation.”

Listing the developments after the policy review, the RBI cited the Central Statistical Organisation’s (CSO) advance estimates of national income which placed real GDP growth for 2006-07 at 9.2 per cent on top of 9.0 per cent in 2005-06.

The general index of industrial production increased by 10.8 per cent during April-December, 2006, as against 8 per cent a year ago.

Further the year-on-year inflation which stood at 6 per cent at the time of the release of the the third quarter review, had risen to 6.58 per cent on January 27 the RBI said. — PTI

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Essar mulls legal action against Vodafone: Report 

London, February 13
Indian conglomerate Essar may start a legal battle against Vodafone, which is replacing Hutchison Telecom in the Indian mobile venture Hutch-Essar, on account of it being ignored in taking key business decisions, British media reported today.

Quoting unnamed sources, The Times reported that Essar was concerned over Vodafone's move to forge ahead with plans like network sharing without consulting it first.

Essar, which has long claimed legal rights, including a right of refusal over Vodafone's bid, is understood to be considering taking legal action, the paper reported.

The Times report quoted unnamed sources close to the group as saying that Essar was unhappy about the way Vodafone was treating the acquisition as a done deal when their position was yet to be resolved.

An Essar Group spokesperson from Mumbai said "Essar is awaiting an official communication from Hutchison relating to Hutchison's proposed agreement to sell its stake to Vodafone as reported." "On receiving the same, Essar will evaluate all its options in the coming weeks and take the necessary steps in the best interest of the company."

The plan to share network with India's leading mobile player, Bharti Airtel, was central to Vodafone's strategy to maximise returns from Hutch-Essar, The Times report said.

Essar is yet to decide whether to sell out of the venture or accept Vodafone's offer of a partnership.

According to the paper, the complaints from Essar come amid some shareholders and analysts questioning the full price paid by the British mobile giant for the Indian asset.

It added that Vodafone believed its acquisition of the 67 per cent stake in Hutchison Essar was not conditional on Essar's movements and the company CEO Arun Sarin had questioned any right of refusal over its bid by the Ruias. — PTI

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Vodafone keen on Essar as partner

Barcelona, February 13
Amid the confusion over whether or not Essar will continue in Hutch-Essar, the new majority stakeholder Vodafone said today it was for the Indian conglomerate to decide though it would be offered the same terms as given to Hutchison Telecom.

"In couple of weeks an identical offer will be made to Essar as we paid the price to Hutchison Telecom... Now if they (Essar) want liquidity they may sell but my great hope is that they stay in the business," Vodafone CEO Arun Sarin said here.

Talking to reporters on the sidelines of the ongoing 3GSM World Congress, he said: "We are eager for Essar to be a partner in our venture. We would like a local partner and we welcome Essar to stay since they are attached to the business for 7-8 years." "But they have a choice to make," Mr Sarin said. — PTI 

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Race for buying 43.5 pc stake in PTL hots up
Ashok Leyland, Sonalika also in fray
Tribune News Service

Chandigarh, February 13
The decks are all clear for the acquisition of the 43.5 per cent stake of PunjabTractors Limited (PTL). On the last day for the bids, as many as six top tractor companies have joined the race to acquire the company’s shares.

The flagship company of Hinduja Group, Ashok Leyland, has joined the fray, along with Sonalika Group, Tafe, Mahinda and Mahindra and Tata Motors. Mr Yash Mahajan, former Chairman, PTL, is also believed to have tied up with some investment bankers, and is in the race to acquire shares of the company.

Mahindra and Mahindra had put in a non-binding bid for acquiring the stake last week. With so many companies now in the race, it has led to fears of a bid war in the company.

The Managing Director of Ashok Leyland, Mr R Seshasayee, today confirmed that they have bid for the 43.5 per cent share of the two financial investors in PTL — Actis and Burmans. While Actis has put its 29 per cent stake on the block, the Burman family (promoters of Dabur group), have a 14.5 per cent stake in the company.

Meanwhile, the employees of the company are now feeling threatened with only strategic investors bidding for the stake. They fear that this could mean an end to the company’s brand — Swaraj Tractors — as the new stake holder would promote his own brand. 

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Bajaj unveils 200 cc Pulsar

New Delhi, February 13
Betting big on returns from the performance bike segment, Bajaj Auto Ltd said today it was targeting to cross the Rs 10,000-crore turnover mark this fiscal with sales of 2.8 million vehicles.

"This fiscal our total turnover should cross the Rs 10,000 crore mark with a sales of 2.8 million vehicles," Bajaj Auto Managing Director Rajiv Bajaj said here after launching the company's new 200 cc 'Pulsar' motorcycle.

He said the company expected a topline growth of 25 per cent over last fiscal, even as it focusses on higher engine capacity and sporty performance motor cycles for its future course with a slew of launches scheduled.

"By May the Pulsar 220 cc with fuel injection will be launched and the following month the 200 cc cruiser bike Avenger should hit the market," Mr Bajaj said. He said the company has decided to move away from the lower margin, low-capacity bikes and would give emphasis on higher cc motorcycles.

He said the to-be-launched fuel injection technology DTS-i 220 cc bike could cost about Rs 80,000-Rs 85,000, while the 200 cc Pulsar DTS-i launched today has been priced at Rs 65,497.

On the company's plans for the four-wheelers, he said: "It is still two years away. We are developing a goods carrier at the moment," adding the company would need a completely new plant for it.— PTI

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Bombardier, REL tie up for Chandigarh project
Tribune News Service

New Delhi, February 13
Canadian transportation major, Bombardier, is planning to participate in the rail and mass transit projects in the country in a major way and has tied up with Reliance Energy (REL) for Chandigarh Mass Transit project.

Mr Rajeev Jyoti, Managing Director of Bombardier Transportation India, told reporters here today that “joint expression of interest have been submitted together with Reliance Energy of India for Hyderabad and Chandigarh Mass Transit project.”

He said Bombardier was the leader in supplying metros worldwide and had the technology to tailor it to local climate conditions and requirements.

He said the country required 600 high-powered locomotives for the Indian Railway Freight Corridors and the company in its discussions with the Rail Ministry officials suggested electric engines, as it strengthened New Delhi’s energy security. “Bombardier is considering an association with the Indian Railways under a public-private partnership scheme to create a local manufacturing plant of locomotives,” he said. He said association to localise the manufacturing of other rail products for Indian market was also under consideration.

The company was also preparing to bid for selling rolling stock, as also signalling and communication equipment for the proposed Delhi Metro link between the New Delhi Railway Station and the international airport, Jyoti said.

“The Hyderabad centre of the company is involved in the development of vehicle-engineering design for top products like the Movia for the London Underground, the Electrostar for South Africa and high-speed electric multiple units for China,” he pointed out.

“In the signalling sector, a highly-advanced automatic communication-based train control system for the Madrid Metro is being developed with the cooperation of the Hyderabad centre,” he added.

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TCS opens JV in China

Beijing, February 13
India Inc. today took yet another great leap forward when IT conglomerate Tata Consultancy Services (TCS) launched a joint venture in China to scale up global operations and announced securing "a significant multi-million dollar" contract, the second major one, in the country within months.

"TCS has successfully completed five years in China and the new joint venture is the next step in our long journey in China," the central bank CEO and Managing Director of TCS, S Ramadorai said at a press conference here. Microsoft, the global software giant, would take up a 10 per cent stake in the JV at a later stage, Mr Ramadorai said.

The contract with Shanghai-based China Foreign Exchange Trade System (CFETS) was to implement a comprehensive international trading system for the body, which is sub-institution of the People's Bank of China, he said. — PTI

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Govt issues bonds worth Rs 11,200 cr

New Delhi, February 12
The government has issued bonds of Rs 5,000 crore for state-owned oil marketing companies and Rs 6,200 crore for Food Corporation of India.

Three oil companies — Indian Oil Corporation, including IBP, BPCL and HPCL — have been issued bonds worth Rs 2,953.02 crore, Rs 1,040.03 crore and Rs 1,006.95 crore, respectively, an official release said.

The fourth tranche of oil bonds (GoI Special Bond, 2024) have been issued to compensate for supplying subsidised kerosene and LPG in the domestic market. It will carry a coupon rate of 8.20 per cent and would have a tenure of 17 years.

FCI bonds worth Rs 6,200 crore at a coupon rate of 8.23 per cent for 20 years period have been issued for the supply of foodgrains to the Ministry of Rural Development. — PTI 

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Secys seek norms for studying FDI

New Delhi, February 13
A high-level Secretaries’ panel has asked the National Security Council, which started a debate on potential threat to national security from FDI in certain sectors and from certain countries, to prepare guidelines for areas to be watched.

The 19-member Committee of Secretaries, headed by Cabinet Secretary B.K. Chaturvedi, on January 31 asked the NSC Secretariat to prepare guidelines for specific areas, nations and firms in respect of which investment needs to be watched/ monitored with greater care, government sources said.

The guidelines, once approved by the government, will be followed by the Foreign Investment Promotion Board and the RBI and a mechanism clarifying the procedures to be followed in cases/ areas of doubt would be put in place.

The NSC had in September identified 18 sectors, including telecom, ports, airports, shipping, oil refining and gas pipelines as sensitive sectors, and asked for greater regulation of FDI from China, including Hong Kong, Macau and Taiwan, Pakistan, Bangladesh, Afghanistan and North Korea.

The existing system, the meeting observed, did not have a mechanism for examining comprehensively funds coming to sensitive locations, sensitive sectors and from countries of concern, neither at the time of approval nor during the period of operation of foreign entities.

Sources said while the Commerce Ministry wanted security concerns to be addressed at the screening level in the FIPB, the Finance Ministry wanted existing provisions under FEMA and licensing requirements to be modified to address the concerns.

Both opposed the NSC's suggestion for an umbrella legislation 'National Security Exception Act' to cover existing foreign entites in India. — PTI 

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Dabhol stake not on sale: Shinde

New Delhi, February 13
The government clearly said today that it would not sell any stake in Dabhol power plant's LNG import terminal.

''We are not going to sell any stake in Dabhol to anyone,'' Power Minister Sushil Kumar Shinde said here.

Earlier, it was reported that the government was planning to sell the terminal to firms like Reliance Industries or the Gujarat State Petroleum Corporation (GSPC), who can keep fuel cost of the power plant low by pooling costlier imported LNG with their cheaper domestic gas.

Reliance had expressed its interest in taking over the Dabhol LNG terminal while the GSPC had intentions to build two import terminals on the west coast.

Speaking at a two-day NTPC conference, Mr Shinde urged all power-generating companies to enhance their efficiencies.

With over 100 power-generating companies operating in the country at present, the minister called upon the manufacturing units ''to increase the capacity addition''. —UNI

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Intel unveils super-chip technology

San Francisco, February 13
Intel has touted a diminutive new microprocessor which can deliver "supercomputer-like" performance to home computers and handheld devices.

Intel said yesterday that its unprecedented programmable processor was not much larger than a fingernail, used less power than a typical home appliance and could perform more than a trillion calculations per second — a "teraflop." Such "tera-scale computing" could make possible artificial intelligence, real-time speech recognition, realistic video games, instant online film viewing and other stuff from the realm of science fiction, according to Intel.

"Our researchers have achieved a wonderful and key milestone in terms of being able to drive multi-core and parallel computing performance forward," said Intel Chief Technology Officer Justin Rattner.

Intel had no plans to market the new chip but said it would be used to develop compatible software. — AFP 

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Bank of Rajasthan ups term deposit rates 

Mumbai, February 13
The Bank of Rajasthan (BoR) said today it had revised the interest rate on its term deposits with effect from February 10.

For deposits below Rs 15 lakh, the interest rate for deposits of one year to less than three years will be 8.75 per cent while for three to five-years, it will be 9 per cent, a bank statement stated here today.

For five years and above, the rate will be 9.5 per cent. For deposits of Rs 15lakh and above, the interest rate for 180 to 270 days would be 7.5 per cent, for 271 days to less than one year it will be 8 per cent.

The interest rate for deposits of one to less than three years would be 9 per cent while for three to five years, it will be 9.25 per cent. — PTI 

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RBI to study US demand for bank branches in India
Tribune News Service

New Delhi, February 13
The government said today the RBI would consider the US demand for relaxing the branch opening norms for foreign banks in India as per the roadmap prepared by it.

"The RBI has a roadmap and the decision has to be taken after a consensus is reached," Commerce and Industry Minister Kamal Nath told reporters after jointly addressing a Ficci meeting with US Commerce Secretary Carlos M Gutierrez here today.

In his meeting with Mr Gutierrez, earlier in the day, the Commerce Minister raised the demand of Indian banks wanting a liberal licensing regime in the United States.

"We discussed ways to enhance trade and investment. There were specific issues that we talked about. These include Indian banks opening more branches in the US," Mr Nath said.

He said the discussion also centered around development of infrastructure and piracy of Indian music.

In his speech at the Ficci meeting, Mr Gutierrez expressed concern over India being a major global source of counterfeit medicines. "Enforcement is the key. Without protecting patents data India will not attract the R & D and innovation necessary for strong growth in sectors such as pharmaceuticals," he said.

He said nearly three quarters of all US software in India was pirated.

"The challenging regulatory climate here continues to hamper commercial opportunities. While there are many success stories, there are also many stories of failed partnerships and business ventures," Mr Gutierrez pointed out.

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Manufacturing sector must grow at 15 pc: Nath
Tribune News Service

New Delhi, February 13
The Indian manufacturing sector must grow at a rate of 15 per cent per annum to achieve the target of 25 per cent share of the manufacturing sector in GDP from the current level of 17 per cent, Commerce and Industry Minister Kamal Nath said today.

The minister was speaking at the inauguration of the 17th International Engineering and Technology Fair, organised by the CII.

Over 30,000 business visitors have confirmed their attendance for the biennial exhibition of engineering goods, including 10,000 from overseas. Japan is the partner country for the 17th edition of IETF.

Saying that the engineering goods sector has expanded and diversified, and is now the fastest-growing sector of industry, Mr Nath said it was also a sector of high employment.

One job created in the manufacturing sector leads to three more new jobs in the services sector. “Our intention is to ensure that the share of manufacturing in GDP moves from 17 per cent to 25 per cent,” the minister stated.

India has a low-cost advantage due to the synergy of its large workforce with technology and innovation, he said.

The country can attract 25 per cent of the global egineering pocess otsourcing industry, and has great potential in kowledge pocess otsourcing as well. The huge domestic market and the need for infrastructure, pegged at $330 billion, indicate that there is great potential for achieving the growth target of 15 per cent in manufacturing.

Speaking on behalf of the Minister of Economy, Trade and Industry (METI), special guest at the inaugural, Mr Toshiaki Kitamura, Vice Minister for International Affairs, METI, Japan, said Japan was delighted to be the partner country for the second time at IETF.

He said FDI from Japan to India has been growing at 60 per cent for the last two years. 

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BRIEFLY

Reliance Capital picks 6 pc in GBN
New Delhi, February 13

Anil Ambani group company Reliance Capital has acquired over 6 per cent stake in Global Broadcast News Ltd (GBN), which operates CNN-IBN and IBN7 channels, for an estimated Rs 87 crore. Reliance Capital acquired 16.75 lakh GBN shares through an open-market transaction on the BSE on Monday. GBN recently got listed on the bourses with over 50 per cent premium in its debut. — PTI

Nokia launch
Bangkok, February 13
Nokia has launched new Nokia E-series devices, designed for business professionals, including 'Nokia E61i' e-mailer device and the 'Nokia E-65' slider in Bangkok. The company also launched 'Nokia E-90 Communicator' — a legendary communicator with an all-inclusive business device with advanced technologies, such as HSDPA (next version of 3G Communications) and integrated GPS which will help a subscriber navigate through cities with directions. These models will be launched in India later on. — PTI

IPO on track: DLF
New Delhi, February 13
DLF, which revived its process of entering the capital market last month to raise Rs 13,600 through its IPO, said today thatvits IPO plan was on track and the company was waiting for SEBI approval. — PTI

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