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Budget impact
Cement prices up

Mumbai, March 1
One day after finance minister P. Chidambaram announced a differential duty structure on cement, the industry has reacted sharply by increasing the price of the commodity.

Ban on futures trading cuts wheat prices
New Delhi, March 1
The UPA government has every reason to smile as the wheat prices have started falling in response to a ban on futures trading in these items announced by Chidambaram in his Budget proposals yesterday.

FM seeks industry help to curb inflation
New Delhi, March 1
A day after presenting the Union Budget , finance minister P. Chidambaram today sought the help of the industry, especially cement companies, to contain inflation.
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EARLIER STORIES

 
Bollywood actress Neha Dhupia holds up newly launched Motophone F3c in Bangalore on Thursday.
Bollywood actress Neha Dhupia holds up newly launched Motophone F3c in Bangalore on Thursday. The phone is 9mm in thickness and is priced at Rs 1,699. It is the first device in the country based on the Qualcomm single-chip chipset family. — AFP

PNB hikes term deposit rates
New Delhi, March 1
Punjab National Bank increased the interest rate between 0.5-1 per cent on two of its special saving schemes - PNB Mahabachat and PNB Tax Saver Fixed Deposit Scheme - with effect form today.

Export duties halt Goa iron exports
Mumbai , March 1
Goa, which accounts for more than 30 per cent of India's iron ore exports, has halted all shipments to foreign shores from today following the export duties imposed by finance minister P. Chidambaram in the Budget.

HTIL files caveat fearing legal move by Essar
Mumbai, March 1
Hong Kong-based Hutchison Telecom has filed a caveat in the Bombay High Court to ensure that its plea is heard in case Essar moves the court, challenging the foreign partner's decision to sell its stake to Vodafone.

Cabinet clears Indian-AI merger
New Delhi, March 1
The Union Cabinet today cleared the proposal for the merger of Air-India and Indian — creating the country's largest airline.

Wipro, MS ink pact
Mumbai, March 1
IT major Wipro Infotech and world leader in the IT segment Microsoft today announced a path-breaking MoU to provide comprehensive IT infrastructure, solutions and services to Wipro's Total Outsourcing Services (TOS) customers.

OIL plans IPO to raise Rs 1,500 cr
New Delhi, March 1
Oil India Ltd (OIL) plans to raise Rs 1,500 crore through an initial public offering of equity shares by October.

GAIL, ONGC to set up JV for pipeline
New Delhi, March 1
GAIL (India) Ltd and ONGC will set up a joint venture firm for laying pipelines to transport natural gas found off the east coast of India.

Nath woos Australian investment
New Delhi, March 1
India and Australia have agreed to substantially enhance bilateral trade and investment flows, while noting the increasingly diverse and substantial nature of bilateral trade and economic relationship.

FM scores 8/10 marks in Assocham survey
New Delhi, March 1
Finance Minister P Chidambaram has scored 8/10 marks in a quick survey conducted by Assocham on implications of Budget proposals on Indian industry.

Reebok plan
Chandigarh, March 1
Reebok India will strengthen its position in the retail segment. Reebok India managing director Subhinder Singh Prem said they were planning to create bog format stores, which will not just offer the designer shoes, but a fitness expert also, who would provide advice to the customers.

Indra Nooyi
New York, March 1
Indian American corporate executive Indra Nooyi, who is due to become chairperson of $32 billion Pespsico in May, is stepping down from the Board of Directors of Motorola. Nooyi gave additional responsibilities as the reason for stepping down. But media reports linked her decision to billionaire investor Carl Icahn taking a stake in Motorola with the aim of accelerating shares buyback. — PTI

NECC seeks ban on forward trading in maize
New Delhi, March 1
The National Egg Co-ordination Committee (NECC) today asked the government to ban forward trading in maize, which is the most crucial ingredient of poultry feed.

 

 

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Budget impact
Cement prices up
Tribune News Service & UNI

Mumbai, March 1
One day after finance minister P. Chidambaram announced a differential duty structure on cement, the industry has reacted sharply by increasing the price of the commodity.

The cement stockists and dealers association (CSDA) here announced today that cement prices would go up by Rs 10 to 12 per 50-kg bag. Secretary of CSDASanjay Ladiwala said the wholesale price of cement in Mumbai would be around Rs 233 per 50-kg bag while the retail price would be between Rs 245 and Rs 250.

The finance minister had raised the excise duty on cement priced above Rs 190 per 50-kg bag to Rs 600 per tonne from Rs 400 in the Budget.

Though Chidambaram cut duty to Rs 350 per tonne on cement priced lower than Rs 190 per bag, the industry is raising prices across the board to offset losses on the more expensive larger bags.

According to cement manufacturers, most brands sold across the country are priced above Rs 190 per bag. Sources say a handful of small manufacturers may sell cement at the cheaper rate in certain pockets.

The cement manufacturers argue that the finance ministry had based its calculations on last year's cement prices. Since then, raw material costs have increased and the industry had to raise prices, the cement manufacturers association said today. The industry argues that effective excise duty on the cement industry has risen by 50 per cent and it would be passed on to the customers.

When contacted, CFO of JK Cements A.K. Saraogi, said ''It's difficult to justify the cement price without raising it at a time when the excise duty had been raised in the Budget.'' He confirmed that from today onwards all despatches of cement bags being released from his plants for sale will carry price tag showing an increase of Rs 12 per bag. Same indication has been given by other cement manufacturers too.

Group executive president of the company R.G. Bagla said: ''The imposition of dual excise duty on cement in the Union Budget is uncalled for.'' At present, there is a mismatch in demand and supply of cement and the dual excise duty on cement will only lead to further increase in price of cement, especially for the big government projects and in fact for all consumers, where there is stipulation that duties and taxes are as applicable, he said.

The industry is of the view that there is also a lot of thrust on infrastructure, which would mean that demand would continue to grow at the present rate of around 10 per cent. However, the dual policy will hamper projects and the country will continue to face a shortage of cement. It will also have implications on the Rs 55,000 crore committed by the cement sector in the next five-year plan for new capacity, a spokesperson of JK Cement Industries said.

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Ban on futures trading cuts wheat prices

New Delhi, March 1
The UPA government has every reason to smile as the wheat prices have started falling in response to a ban on futures trading in these items announced by Chidambaram in his Budget proposals yesterday.

The downslide in wheat prices continued today on persistent offerings by stockists against slowdown in buying by rolling flour mills after the Forward Markets Commission announced the ban on Wednesday.

Wheat dara (for mills) remained in the negative zone and prices declined to Rs 1,000-1,005 per quintal from Rs 1,020-1,035 per quintal while wheat MP (desi) drifted to Rs 1,200-1,550 per quintal from Rs 1,390-1,590 a quintal.

Existing wheat contracts are expected to continue till March 20.

In line with wheat, chakki atta, maida and sooji also quoted lower at Rs 1045-1055, Rs 1045-1155 and Rs 1200-1220 per bag of 90 kg respectively.

Traders have forecast a further decline in wheat prices in the coming days.

"It seems the downward march in wheat prices are likely to gather momentum in coming days", said a wholesale grain merchant after the decline in wheat prices today.

Bajra in thin trade shed Rs 10 at Rs 645-715 per quintal. — PTI

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FM seeks industry help to curb inflation
Tribune News Service

New Delhi, March 1
A day after presenting the Union Budget , finance minister P. Chidambaram today sought the help of the industry, especially cement companies, to contain inflation.

“Supply side must be augmented and prince line must be held to the extent possible…supply side augmentation is the area where the government needs industry support,” Chidambaram said at an interactive session on the Budget with the captains of Indian industry here.

The finance minister was explained to the industry representatives as how his huge allocations to agriculture and social sectors would ultimately work for the benefit of the industry.

Appealing to the industry leaders to ensure that prices are not jacked up, Chidambaram said “I am happy that most industries have not pushed up prices. But in cement, prices have gone beyond all reasonable limits.”

“The government has seen no cooperation from the cement industry even though they had promised to bring down prices,” he said adding “therefore, we say, we will try to reward those having inclination to hold the price line, but we will tax anyone using that opportunity (of huge demand) for making huge profit.”

Industry representatives, led by CII president R. Sesashayee expressed doubt over the efficacy of the duty differential system spelt out by the ffinance minister in his Budget yesterday.

“With supply side constraints, duty differential could lead to unaccounted money,” Sesashayee said.

Asked whether the dual-tax policy for cement industry would help break any cartel prevalent in the industry, the finance minister said the country had anti-monopoly legislations and they needed to be strengthened. “We have reservations about using indirect taxation as an instrument in this regard. It would not solve the problem in the long run,” he added.

He argued that if agriculture were to grow annually at 4 per cent from the low 2.3 per cent at present, then it would create a huge market for industrial goods.

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PNB hikes term deposit rates
Tribune News Service

New Delhi, March 1
Punjab National Bank increased the interest rate between 0.5-1 per cent on two of its special saving schemes - PNB Mahabachat and PNB Tax Saver Fixed Deposit Scheme - with effect form today.

While the interest rate on the Mahabachat scheme has been increased by 1 per cent to 9.5 per cent for the maturity period of one to less than two years, for the term deposits of two to less than three years, the rate has been enhanced by 0.5 per cent to 9.25 per cent.

For the deposits with a three-year maturity, the interest rate has been left unchanged at 9 per cent, the bank said, adding that minimum deposit for the scheme has been reduced to Rs 25,000 from Rs 50,000 earlier.

The statement said, similarly, interest rate for PNB Tax Saver Fixed Deposit Scheme has been increased from 8 per cent to 8.5 per cent, while for senior citizen the rate has been upwardly revised to 9 per cent. 

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Export duties halt Goa iron exports
Shiv Kumar
Tribune News Service

Mumbai , March 1
Goa, which accounts for more than 30 per cent of India's iron ore exports, has halted all shipments to foreign shores from today following the export duties imposed by finance minister P. Chidambaram in the Budget.

Five ships carrying 80 tonnes of ore each which were due to depart from Goan shores today were asked to stay back as exporters would have been liable to pay duties at the rate of Rs 300 per tonne under the provisions which came into effect from today. The ships were due for China.

During the last financial year, Goa exported 36 million tonnes of iron ore, mainly to China. According to S. Sridhar, Secretary, Goa Mining Exporters Association, buyers would not absorb the Rs 300 per tonne hike since the iron ore exported from Goa is of an inferior quality. "Goan ore fetched just about Rs 200 per tonne in the international market since it is of a lesser grade. With export duties alone at Rs. 300 per tonne we might as well shut down," Sridhar said.

Mining is Goa's biggest industry ahead of tourism, employing the largest number of people. As many as 60 per cent of Goa's population is directly and indirectly employed in the mining industry. The state has about 40 big iron ore exporters out of which 9 are major players like Sesa Goa, Dempos and Salgaocars. According to industry observers, the small mines in Goa will shut down immediately while the bigger players will cut down production.

Already, 2,000 trucks employing more than 20,000 persons directly and indirectly have been asked to halt operations. An equal number of people are employed in barges which transport ore from the hinterland to the Murmagao port from where the ore is sent to China.

Goa's mine owners today petitioned Chief Minister Pratapsinh Rane to take up the issue of high export duties with the Central Government. The state government is sympathetic to the mine owners, officials said.

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HTIL files caveat fearing legal move by Essar

Mumbai, March 1
Hong Kong-based Hutchison Telecom has filed a caveat in the Bombay High Court to ensure that its plea is heard in case Essar moves the court, challenging the foreign partner's decision to sell its stake to Vodafone.

Essar, which is a 33 per cent stakeholder in Hutch-Essar, has been claiming that they have the right of first refusal (RoFR) for the Hutchison Telecom's (HTIL) stake.

HTIL had recently agreed to sell its 67 per cent stake in the Indian business to UK's Vodafone, side-stepping Essar.

However, on the issue of RoFR, the Essar spokesperson said: "We are keeping all our options open and have not yet taken a decision." HTIL's shareholders will on March 9 vote on Vodafone's offer to buy out the Hong Kong company's 67 per cent stake for $11.1 billion.

HTIL has been maintaining that Essar does not have the RoFR in the event of sale to Vodafone, which is also of the same view.

However, Essar thinks otherwise and is believed to have raised the issue when Vodafone CEO Arun Sarin was in India last month. — PTI

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Cabinet clears Indian-AI merger
Tribune News Service

New Delhi, March 1
The Union Cabinet today cleared the proposal for the merger of Air-India and Indian — creating the country's largest airline.

The Cabinet meeting, chaired by Prime Minister Manmohan Singh, gave its assent to the proposal moved by the civil aviation ministry. The Cabinet note was moved following the clearance of the merger proposal by the eGoM 10 days ago.

The eGoM, headed by external affairs minister Pranab Mukherjee, had given its clearance following several rounds of meetings.

The civil aviation minister is expected to make a statement in Parliament on the merger tommorow. The two public sector airlines, after the merger, would have a new name and would have a synergised working.

The Union Cabinet while clearing the proposal hoped that the two airlines would be able to carry out all the necessary legal and procedural formalities for the merger in the next 16 weeks.

Sources said that while the initial merger would be in place in the next six months, but the new entity would have to go through various processes of merger before the new airline was finally in place.

The new airline will have a fleet strength of 111 aircraft by 2010, the time when India would host the Commonwealth Games and would have an employee strength of about 33,000. 

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Wipro, MS ink pact

Mumbai, March 1
IT major Wipro Infotech and world leader in the IT segment Microsoft today announced a path-breaking MoU to provide comprehensive IT infrastructure, solutions and services to Wipro's Total Outsourcing Services (TOS) customers.

''The worldwide TOS business is a key focus area of growth for Wipro, and the collaboration will enable Wipro to draw on Microsoft Corp's global technical experience and enhance the offerings in this market,'' Wipro Infotech president Suresh Vaswani said.

''The alliance will enable Wipro to build solutions using Microsoft. Operations Manager, SQL Server' 2005, Systems Management Server 2003, Exchange Server 2007 and Windows Server 2003 products for its TOS customers.

This MOU evolved from Wipro's work with Microsoft IT-India, an extension of the Microsoft IT team developing mission-critical enterprise applications that support Microsoft's business worldwide, Microsoft India chairman Ravi Venkatesan said. — UNI

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OIL plans IPO to raise Rs 1,500 cr

New Delhi, March 1
Oil India Ltd (OIL) plans to raise Rs 1,500 crore through an initial public offering of equity shares by October.

"We have proposed a 10 per cent float (to the government). Whether it is through the disinvestment route (government selling its stake) or through equity expansion is for the government to decide," OIL director (finance) T K Ananathkumar told reporters on sidelines of a conference organised by Petrofed to discuss Budget 2007-08. — PTI

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GAIL, ONGC to set up JV for pipeline

New Delhi, March 1
GAIL (India) Ltd and ONGC will set up a joint venture firm for laying pipelines to transport natural gas found off the east coast of India.

“GAIL and ONGC have finalised a draft MoU for setting up of a joint venture for laying and operating gas pipelines network in respect of exploitation of possible gas discovery in Krishna Godavari and Mahandi basins,” minister of state for petroleum and natural gas Dinsha Patel said in the Lok Sabha.

ONGC has struck gas reserves off the Andhra and Orissa coasts and is looking at plans to evacuate the gas to consumption centres.

The joint venture will transport gas to the southern states of Tamil Nadu and Karnataka and in the east to West Bengal. — PTI

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Nath woos Australian investment
Tribune News Service

New Delhi, March 1
India and Australia have agreed to substantially enhance bilateral trade and investment flows, while noting the increasingly diverse and substantial nature of bilateral trade and economic relationship.

This is indicated in the agreed minutes of the 10th India-Australia joint ministerial commission (JMC) meeting, which was signed here last night by commerce and industry minister Kamal Nath and Australian minister for trade Warren Truss, who is heading the largest-ever Australian business delegation to India.

Both ministers expressed satisfaction at the rapid escalation in bilateral goods and services trade between India and Australia and the significant increase in the commercial presence of Indian and Australian companies in each others markets.

Indo-Australian trade registered record increase from $1.4 billion in 2000-01 to $5.7 billion in 2005-06. (Of this, India’s exports to Australia were valued at $0.8 billion and Australia’s exports to India were $4.9 billion).

Hailing India’s emergence as Australia’s fastest-growing trading partner, Truss said: “India is the new kid on the block and everyone is interested”.

Addressing the 16th meeting of India-Australia joint business council today, Nath said he was happy to note that as of now more than 17 Australian companies were engaged in BPO operations in India led by Telstra, Australia’s largest telecommunications carrier.

Inviting Australia to invest in India, especially in mining, farm and education, he said: “The mining sector should be of great interest to many of you. The economies of India’s traditionally backward states, Chhattisgarh, Jharkhand and Orissa have the potential to grow from $30 billion in 2003 to $75 billion by 2015 if they tap their mineral wealth and in the coming years, I expect Australian companies with their state-of-the-art clean coal and mining technologies to play a huge role in developing the wealth of these states.”

Farm sector stakeholders in Australia, he said, might have a lot to offer counterparts in India with regard to the latest farming methods and cropping patterns.

“I also believe that Australian food processing companies can play a huge role in developing boutique crops in India such as canola, Chinese vegetable, grapes, organic wheat, berries, etc,” he said.

India and Australia have agreed to promote bilateral investment, including in the energy, mining, infrastructure, food processing, telecom, information and communications technology, tourism, biotechnology and financial sectors.

While India shared information regarding steps taken to ease FDI regulation, including sectoral caps and simplification of procedures, Australia informed India of the establishment of Invest Australia offices in both Mumbai and New Delhi to facilitate Indian investment into Australia.

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FM scores 8/10 marks in Assocham survey
Tribune News Service

New Delhi, March 1
Finance Minister P Chidambaram has scored 8/10 marks in a quick survey conducted by Assocham on implications of Budget proposals on Indian industry.

Barring representatives of cement and oil and gas industry who criticised the levy of double excise on retail cement prices and imposition of service tax on exploration activities that shrunk the finance minister’s score margins, 75 per cent of 100 CEOs patted him for presenting an investment-friendly budget which will ensure inclusive growth by adequately attacking concerns of most vulnerable sections of society.

The CEOs who appreciated the budget the most comprised representatives of small scale, pharmaceuticals, commodities, power, automobile, engineering, steel and minerals, civil aviation, consumer durables and paper industry, says Assocham president Venugopal N. Dhoot, who released the survey here today.

However, representatives of cement and oil and gas sector sought withdrawal of double excise on cement prices and removal of service tax on exploration activities.

As many as 25 per cent of metro-based CEOs have appreciated higher allocations for forthcoming Commonwealth Games, 2010 ,out of the finance minister’s central plan allocations for putting up hotels and other allied services within the NCR region, terming it most appropriate and timely.

As many as 55 per cent of the CEOs, however, felt that the finance minister should have avoided the enhancement in the dividend distribution tax from 12.5 to 15 per cent even if he brought down peak customs duties from 12.5 to 10 per cent with reasonably extending excise waiver to domestic industry.

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Reebok plan

Chandigarh, March 1
Reebok India will strengthen its position in the retail segment. Reebok India managing director Subhinder Singh Prem said they were planning to create bog format stores, which will not just offer the designer shoes, but a fitness expert also, who would provide advice to the customers. He said they planned to increase the number of stores from seven to 15. While one such store is already here, the company plans to add another such store in the city and one each in Amritsar, Jalandhar, Delhi and Mumbai. — TNS

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Indra Nooyi

New York, March 1
Indian American corporate executive Indra Nooyi, who is due to become chairperson of $32 billion Pespsico in May, is stepping down from the Board of Directors of Motorola. Nooyi gave additional responsibilities as the reason for stepping down. But media reports linked her decision to billionaire investor Carl Icahn taking a stake in Motorola with the aim of accelerating shares buyback. — PTI

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NECC seeks ban on forward trading in maize
Tribune News Service

New Delhi, March 1
The National Egg Co-ordination Committee (NECC) today asked the government to ban forward trading in maize, which is the most crucial ingredient of poultry feed.

“Ever since forward trading was allowed in maize, the domestic market price has increased by 100 per cent, due to manipulation and hoarding by speculative traders and MNCs,” the NECC said in a statement here today.

Urging finance minister P.Chidambaram to ensure a ban on forward trading in maize, as was done in the case of wheat and rice, the NECC pointed out that the input cost for egg and broiler production had gone up by 50 per cent.

The spurt in the input cost was hurting the poultry industry badly and the industry had suffered a loss of nearly Rs 10,500 crore post-bird flu, it added.

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BRIEFLY

Skoda, Hyundai to revise prices
New Delhi, March 1
Premium automobile manufacturer SkodaIndia said today it had decided to revise its vehicle prices after the Budget. “A reduction up to Rs 24,000 is expected across various models,'' company's Managing Director Karsten Bogun said. Meanwhile, Hyundai would also hike prices of its cars across all variants, because of the 1 per cent additional education cess announced in the Union Budget yesterday. — UNI

Bollywood actress Amrita Arora at the inauguration of a newly designed outlet by Nirula's in New Delhi on Thursday.
Bollywood actress Amrita Arora at the inauguration of a newly designed outlet by Nirula's in New Delhi on Thursday. — Tribune photo: Mukesh Aggarwal 

PPD pact with Ranbaxy
New Delhi, March 1
Leading contract research organisation PPD Inc has acquired a worldwide licence to develop, manufacture and market Ranbaxy's 'statin' for the treatment of dyslipidemia. Under the terms of the agreement, Ranbaxy will receive huge payments after specified clinical events. In the event of approval to market a drug product, the company will be entitled to receive royalties on sales of the drug and sales-based milestones. — UNI

Rental slashed
New Delhi, March 1
Bharti Airtel today slashed the fixed monthly rental for BlackBerry to Rs 249 per month from Rs 1,099 per month. As per the new plan, Airtel BlackBerry users will be charged Rs 0.15 per Kb of usage, apart from the fixed monthly rental. The company has also brought down the price of BlackBerry 7100 g handset to Rs 10,999. — UNI

Indian Bank
Mumbai, March 1
Indian Bank today got listed at Rs 105 per share with a decent 15.38 per cent premium over its issue price of Rs 91 on the BSE. After opening, the scrip hit lows of Rs 77 and was last trading at Rs 90.90 as heavy-selling pressure continued due to which 34.06 lakh shares changed hands quickly. — PTI

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