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Signs of overheating in economy: Montek
New Delhi, March 20
Amid euphoria over the growth rate, the Planning Commission today said that the current upswing in the economy was unlikely to continue in the long run as there are signs of overheating in the economy.


Montek Singh Ahluwalia
Montek Singh Ahluwalia

Cap on SEZs under study
New Delhi, March 20
Ruling out any review of the tax and tariff concessions for special economic zones (SEZs), the government said today the empowered Group of Ministers (eGoM) is examining various issues, including cap on number of SEZs in different categories and restructuring board of approvals in the commerce ministry.



EARLIER STORIES

 
Models display Nokia 6300 phones at a function in which Nokia was signed up as an associate sponsor for Wills Lifestyle India Fashion Week in New Delhi
Models display Nokia 6300 phones at a function in which Nokia was signed up as an associate sponsor for Wills Lifestyle India Fashion Week in New Delhi on Tuesday. — Tribune photo by Mukesh Aggarwal

Airlines told to withdraw congestion levy
New Delhi, March 20
Private airlines have been asked by the government to withdraw the congestion surcharge of Rs 150 imposed per passenger and give their response by tomorrow.

Music kiosks set up at Chennai airport
Offer songs download for as low as Rs 5
Chennai, March 20
Now you can legally and cheaply download any of your favorite songs or video clips from digital kiosks at the airports from a range of 40,000 songs of various languages, including Hindi and Punjabi.

Reconsider amending IT Act: Assocham
New Delhi, March 20
Assocham has urged the finance minister to reconsider amending the Income Tax Act Section 10 (23FB) in a manner so that BPO, KPO, BTO & ITEs also remain within its ambit for tax concessions for venture capital investments (VCIs).

Indo-Gulf non-oil trade exceeds $20 b
New Delhi, March 20
Minister of state for external affairs E. Ahmed said today that Gulf countries had emerged as major trading partner for India with annual two-way non-oil trade exceeding $20 billion.

Dell upbeat on India, eyes $1 b sales
New Delhi, March 20
The world’s largest computer maker Dell has said its Chennai plant will become operational by July this year and the company is expecting its India revenues moving toward $1-billion mark. “Our Chennai factory will be operational by July,” the company’s founder and CEO Michael Dell said at a press conference here today.


Union IT and telecommunications minister Dayanidhi Maran with Michael Dell, chairman and CEO, Dell, in New Delhi on Tuesday. — Tribune photo by Mukesh Aggarwal

Union IT and telecommunications minister Dayanidhi Maran with Michael Dell, chairman and CEO, Dell, in New Delhi

Indian Bank to expand in Sri Lanka
Colombo, March 20
Indian Bank is planning to expand its operations in Sri Lanka, taking advantage of over $2 billion of bilateral trade between the two nations. The bank marked its 75th anniversary here with gross profits rising to Rs 179 million from Rs 137 million for the nine months ended December last year.

AIG Capital buys Weizmann Homes
New Delhi, March 20
AIG Capital India Private Limited, a wholly owned subsidiary of American International Group, signed an agreement to acquire 100 per cent of the outstanding equity of Weizmann Homes Limited, a housing finance company registered with the National Housing Bank from Weizmann Limited, Federal Bank, Asian Investment & Finance Corporation Limited and other minority shareholders.

Virgin’s executive director for telecom and media Robert Samuelson (second from left) and CEO of Essar Telecom Rajiv Agarwal (second from right) pose with models in Mumbai
Virgin’s executive director for telecom and media Robert Samuelson (second from left) and CEO of Essar Telecom Rajiv Agarwal (second from right) pose with models in Mumbai on Tuesday. Essar Telecom has announced its tie-up with UK’s Virgin Group for The MobileStore, Essar’s network of telecom retail stores, launched last month.—AFP

Taming Inflation
Price monitoring cell formed
New Delhi, March 20
The government has constituted a price monitoring cell chaired by additional secretary in the cabinet secretariat to monitor state wise and region wise prices of all identified essential commodities on a daily basis.

Bharti rejigs top brass
New Delhi, March 20
Telecom major Bharti Airtel Ltd today announced a change in the operational leadership structure and roles in the company to be effective from April 1.

Ranbaxy exits Merck’s bid
New Delhi, March 20
Country’s largest drug firm Ranbaxy is understood to have pulled out of the race to acquire German pharmaceutical company Merck’s generic business on concerns of overvaluation.

NIIT inks pact with EMC
New Delhi, March 20
NIIT has signed an MoU with US-based IT infrastructure solutions provider EMC to provide training in storage technology management in India through its centres across the country.

Essar Shipping scraps delisting plans
Mumbai, March 20
Shares of Essar Shipping today plunged by nearly 6 per cent after the company said that buyback offer for its delisting did not get sufficient bids and has decided to keep the company listed on bourses.

Max New York Life plan
New Delhi, March 20
Max New York Life today launched its new group insurance plan for employees under the ULIP. The new plan gives an additional 3 per cent allocation on the primary investment by the employee-employer, Max New York Life said.





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Signs of overheating in economy: Montek
Tribune New Service and PTI

New Delhi, March 20
Amid euphoria over the growth rate, the Planning Commission today said that the current upswing in the economy was unlikely to continue in the long run as there are signs of overheating in the economy.

There are signs of overheating in the economy and the 9 per cent economic growth is putting pressure on inflation, commission deputy chairman Montek Singh Ahluwalia told reporters today after a meeting between a GoM and Left party leaders on FDI limit in insurance sector.

“Inflation has been brought under control as the government has taken several fiscal and monetary measures,” he said, adding that the current upswing in the growth rate is unlikely to sustain for all times to come.

Overheating is a reflection of the fact that demand is pushing ahead of capacity in certain sectors and in turn leading to rise in prices, Ahluwalia said.

When asked whether the commission would review the growth target of 9 per cent, given in the approach paper for the 11th five-year plan, he said measures to curb surging inflation might put pressure on high growth initially, but on an average the targets would be maintained.

There are upswings and downswings in growth but in the five-year period till 2012, it was still projected to be 9 per cent, he said.

The final document for the 11th plan will be out by September, Ahluwalia said, adding that the sub-committee of the NDC, including all state ministers of agriculture will meet on April 23 to discuss the Swaminathan Committee report on farm sector.

He maintained that the commission was of the view that inflation was a matter of concern and GDP growth had to be achieved with reasonable level of inflation.

“Next important target is to put agriculture on high growth path,” he said.

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Cap on SEZs under study

New Delhi, March 20
Ruling out any review of the tax and tariff concessions for special economic zones (SEZs), the government said today the empowered Group of Ministers (eGoM) is examining various issues, including cap on number of SEZs in different categories and restructuring board of approvals in the commerce ministry.

"Number of representations on various issues pertaining to SEZs have been received and these have been placed before the eGoM," minister of state for commerce Jairam Ramesh said in a written reply in the Lok Sabha.

He said the issues placed before the eGoM include cap on the number of SEZs in different categories, giving thrust to manufacturing and exports, environmental impact, prescribing maximum size of the SEZs, land used within the zones and revamping of the board of approvals.

The eGoM on SEZ, headed by external affairs minister Pranab Mukherjee could not meet since January 2007, as controversies and violent protests broke out on the issue.

"Pending further direction by the eGOM, fresh approvals for setting up new SEZs are presently on hold," Ramesh said.

However, he made it clear there were no proposals to review the tax and tariff concessions for the zones as provided in the Special Economic Zones Act 2005, which was operationalised from February 10, 2006. — PTI

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Airlines told to withdraw congestion levy
Tribune News Service

New Delhi, March 20
Private airlines have been asked by the government to withdraw the congestion surcharge of Rs 150 imposed per passenger and give their response by tomorrow.

While all private carriers have imposed the surcharge for the past few weeks, state-owned airline Indian has not.

The private carriers have been asked to respond by tomorrow to the directorate general of civil aviation’s directive to withdraw the surcharge, civil aviation minister Praful Patel said.

Asked whether the private airlines were charging this surcharge on sectors where there was no air traffic congestion also, Patel said these carriers had imposed the surcharge on their entire network.

Patel said DGCA expected a shortage of around 500 pilots every year due to the growth in the industry.

Presently, there were 3,000 type rated pilots in India, he said, adding there were approximately 565 foreign pilots in the country working with various airlines.

To a related question, he said the DGCA did not suo motu grant or validate the commercial pilot licences of foreign pilots.

However, Patel said if airlines wished to deploy foreign pilots/instructors, such applications were considered by the DGCA for validation subject to fulfilment of prescribed conditions.

As per the available traffic data, on an average 1,51,407 passengers embark from Indian airports per day. The growth of the aviation sector will depend upon GDP growth, foreign tourist arrivals and domestic tourism, Patel said.

He also said his ministry had taken up the issue of high margins of oil companies in the selling price of aviation turbine fuel (ATF).

However, he said the government did not have any administrative pricing mechanism in respect of ATF and oil companies were free to fix prices based on market forces.

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Music kiosks set up at Chennai airport
Offer songs download for as low as Rs 5
Tribune News Service

Chennai, March 20
Now you can legally and cheaply download any of your favorite songs or video clips from digital kiosks at the airports from a range of 40,000 songs of various languages, including Hindi and Punjabi.

This concept is the first of its kind in the country and Giri Trading Agency Pvt Ltd has launched the Anytime Digital Downloads (ADD) kiosks at the domestic terminal of Chennai airport.

The Mumbai-based company is also planning to expand to South East Asian countries, Europe and the USA to cater to the large number of NRIs residing there.

Giri director T.S. Ranganathan said, “We have installed four kiosks at the Chennai airport. We will soon install many more at the airports in Mumbai, Hyderabad and Bangalore and gradually at airports all over the country”.

“There are 40,000 songs in Indian languages, including Tamil, Telugu, Malayalam, Kannada, Hindi, Urdu, Punjabi, Bengali, Marathi and even Bhojpuri available to air passengers from all over the country.”

Ranganathan said all songs were copyrighted and the company had an agreement with South India Music Companies Association (SIMCA).

Regarding Western music, he said that the company might enter into agreements with foreign companies in future but not at this moment as the question of copyright was involved. “There will be no question of any kind of piracy,” he added.

He said that the minimum download price of a song would be Rs 5 only and one can download through a touch screen in a user friendly environment into one’s mobile phones, Ipods, USB-MP3 players and pen drives.

Ranganathan said, “The ADD kiosk will also be installed in shopping malls, multiplexes and restaurants. It can also morph into utility payment terminals and accept payments for virtually any utility service like telephone, electricity, credit/debit card dues besides turning into a multipurpose vending machine that possibly can issue railway and bus tickets and sell petroleum products”.

Other than those who would like to swipe their credit cards there would also be a currency valuator at place for those who would prefer to pay in cash, he added.

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Reconsider amending IT Act: Assocham
Tribune News Service

New Delhi, March 20
Assocham has urged the finance minister to reconsider amending the Income Tax Act Section 10 (23FB) in a manner so that BPO, KPO, BTO & ITEs also remain within its ambit for tax concessions for venture capital investments (VCIs).

In a representation sent to ministry, Assocham president Venugopal N. Dhoot said tax benefits should not only be restricted to bio-technology and pharma industry by amending Section 10 (23FB) as is being sought in the budget proposals 2007-08 and status quo should be maintained so that all IT, ITEs, telecom, wireless value-added services are kept within the ambit of venture capitalists.

Dhoot said venture capital funds deserved better treatment in the sense that their investments in knowledge industries will lead to innovation and cost cutting and therefore such funds should continue to enjoy tax incentives to widen the base of knowledge industry.

The chamber has also pointed out that worldwide, venture capital has been the engine of growth for knowledge base industries for innovation across all sectors. India, thus should not be far off them and should extend all possible incentives to venture capitalists not only for IT but also BPO, KPO and BTO industry.

The growth rate for this industry is estimated to be around 9-10 per cent from less than 6 per cent now and therefore subjecting VC’s investments in them as also in similar industries will curtail their prospects.

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Indo-Gulf non-oil trade exceeds $20 b
Tribune News Service

Seeks exploration in Bahrain

India said today it wants to participate in oil and gas exploration blocs being offered by Bahrain.

"Bahrain is offering new oil and gas exploration blocs ... our industry will be happy to participate in the exploration ventures," E Ahamed said. — PTI

New Delhi, March 20
Minister of state for external affairs E. Ahmed said today that Gulf countries had emerged as major trading partner for India with annual two-way non-oil trade exceeding $20 billion.

Addressing a joint business meeting organised by Assocham, CII and Ficci in the honour of Shaikh Salman Bin Hamad Al Khalifa, Crown Prince of the Kingdom of Bahrain, Ahmed said the entire Gulf region has become India’s largest trading partner and hoped that their two-way trade would further accelerate.

The Gulf countries, Ahmed said, were also emerging as the largest source of India’s oil and gas requirements, besides a collective home to the largest expatriate Indian community with strength of more than 4.5 million of which 240,000 live in Bahrain.

Co-chairman of Assocham’s Banking Committee Gautam Kanjilal announced that Assocham and the Bahrain Chamber of Commerce and Industry signed an MoU to strengthen trade and economic ties between India and Bahrain to further accelerate their trade volumes. CII representative MA Mathan also stressed the need for closer cooperation between India and Bahrain.

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Dell upbeat on India, eyes $1 b sales

Calls for tax cut

Dell is investing $19 billion in China and Vietnam over the next few years but not a cent in India due to its high tariff, Michael Dell said.

“Today, if you spend 20-25 per cent on taxes and duties for computers, it is far too high compared to other countries around the world. You are taxing progress,” he said.

“That’s why Dell and its global chain of 86 suppliers are spending $19 billion in China and Vietnam and the equivalent in India is zero,” Dell said, calling for a slash in such levies by the government to improve computer penetration.

“In fact, one such supplier is investing $5 billion in Vietnam and not in India. These are investment dollars India too could attract,” he said, adding a lower tariff for mobile phones had led to a telecom boom in India. — IANS

New Delhi, March 20
The world’s largest computer maker Dell has said its Chennai plant will become operational by July this year and the company is expecting its India revenues moving toward $1-billion mark.

“Our Chennai factory will be operational by July,” the company’s founder and CEO Michael Dell said at a press conference here today.

He said the India factory would cater to the domestic market to start with. The factory would have the capacity of 4,00,000 units per annum.

When asked whether the capacity was too little in the Indian market for PCs that has touched 6.5 million units, Dell said the capacity would be ramped up as the demand increases.

He said the company’s revenues in India grew 70 per cent year-on-year last year to $500 million and we were rapidly closing toward $1 billion, Dell said.

He said Dell had already become the number one player in the commercial market. In server and storage business we have grown our market share to 19 per cent from 9 per cent.

In India, the company is also looking at alternate models to grow the market, including greater focus on consumer segment, low-cost computers and machines suited to India conditions. — PTI

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Indian Bank to expand in Sri Lanka

Colombo, March 20
Indian Bank is planning to expand its operations in Sri Lanka, taking advantage of over $2 billion of bilateral trade between the two nations.

The bank marked its 75th anniversary here with gross profits rising to Rs 179 million from Rs 137 million for the nine months ended December last year.

“We benefited a lot from an increase in bilateral trade between both countries,” the bank’s chief executive K Raghavan said.

With 35 employees manning a single branch, Raghavan said the bank planned to expand operations next year.

“The Colombo branch is being automated and will be linked to all our Indian branch networks and our offices in Singapore within the next three months,” bank’s chairman/managing director K.C. Chakrabarty said.

The bank is competing for business with three Indian banks, ICICI Bank, Indian Overseas Bank and State Bank of India.

“We don’t feel threatened by competition from fellow Indian banks. We all have our own trade customers, besides we have a growing local clientele as well,” he said. — PTI

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AIG Capital buys Weizmann Homes
Tribune News Service

New Delhi, March 20
AIG Capital India Private Limited, a wholly owned subsidiary of American International Group, signed an agreement to acquire 100 per cent of the outstanding equity of Weizmann Homes Limited, a housing finance company registered with the National Housing Bank from Weizmann Limited, Federal Bank, Asian Investment & Finance Corporation Limited and other minority shareholders.

The acquisition of Weizmann Homes, a 12-year-old Bangalore-based housing finance company with a branch network across 33 cities in India, is subject to regulatory approvals and the transaction is expected to close in April.

This is the second acquisition this year by AIG Capital India in the Indian retail finance industry. It had earlier acquired a controlling stake in a Chennai-based company.

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Taming Inflation
Price monitoring cell formed

New Delhi, March 20
The government has constituted a price monitoring cell chaired by additional secretary in the cabinet secretariat to monitor state wise and region wise prices of all identified essential commodities on a daily basis.

Besides the chairman, the committee has a member each from the department of consumer affairs, department of food and public distribution, department of industrial policy and promotion, department of economic affairs and department of agriculture and cooperation.

The cell monitors the prices on a daily basis and makes interventions with central government ministries on problems of the states on essential commodities leading to shortages in identified areas, minister of state for finance Pawan Kumar Bansal said. — PTI

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Bharti rejigs top brass
Tribune News Service

New Delhi, March 20
Telecom major Bharti Airtel Ltd today announced a change in the operational leadership structure and roles in the company to be effective from April 1.

Rajan Bharti Mittal would relinquish his position as joint managing director and would continue as a non-executive director on the board of the company, while Akhil Gupta would step down as CFO and would continue as joint managing director, the company said in a filing to the Bombay Stock Exchange.

At the operational leadership level, Manoj Kohli would be the president and CEO in the India and SAARC region for the company.

Kohli would lead the company toward becoming a benchmark in innovative practices, operational efficiency and customer value and would be responsible for business strategy, operations and its report to the chairman and managing director, it said.

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Ranbaxy exits Merck’s bid

New Delhi, March 20
Country’s largest drug firm Ranbaxy is understood to have pulled out of the race to acquire German pharmaceutical company Merck’s generic business on concerns of overvaluation.

Ranbaxy, the only Indian company to have made to the second round of bidding, decided to opt out after valuations were stretched to $6 billion, industry sources said. An auction at this stage could easily take the valuations to over $6.5 billion.

When contacted, Ranbaxy officials declined to comment on the development. Ranbaxy was being advised by Goldman Sachs and Citigroup on the deal.

Ranbaxy shares rose nearly 6 per cent today, after losing about 25 per cent since the company first said in early January that it might bid for Merck’s unit. — PTI

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NIIT inks pact with EMC
Tribune News Service

New Delhi, March 20
NIIT has signed an MoU with US-based IT infrastructure solutions provider EMC to provide training in storage technology management in India through its centres across the country.

The MoU was signed here today by NIIT’s president G Raghavan and US-based firm’s vice-president Tom Clancy.

"There is a shortage of over 250,000 storage technology professionals in India and this is the first initiative to address this problem in India," NIIT CEO Vijay Thadani said.

Under this initiative, EMC and NIIT will offer storage technology training and certification to NIIT students and professionals globally, Raghavan said.

EMC will provide technical support in the training process and would certify students after the completion of the programme.

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Essar Shipping scraps delisting plans

Mumbai, March 20
Shares of Essar Shipping today plunged by nearly 6 per cent after the company said that buyback offer for its delisting did not get sufficient bids and has decided to keep the company listed on bourses.

The company informed the stock exchanges that the reverse book- building process, which closed on March 16, did not manage to garner required number of shares for its delisting from bourses.

The delisting offer has failed in terms of the delisting guidelines, due to which no securities would be acquired pursuant to the offer and the company would remain listed on the bourses, Essar Shipping said.

The company's share price plunged to Rs 36 level at the BSE, before ending the day 5.94 per cent or Rs 2.55 down at Rs 40.35. — PTI

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Max New York Life plan

New Delhi, March 20
Max New York Life today launched its new group insurance plan for employees under the ULIP.

The new plan gives an additional 3 per cent allocation on the primary investment by the employee-employer, Max New York Life said. The minimum contribution for the scheme is Rs 6,000 per annum per employee and employees within the age group of 18-64 can opt for the plan. — TNS

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BRIEFLY

Rupee stronger
Mumbai, March 20
The rupee rallied sharply against the US dollar today, ending at nearly 19-month high of 43.73/75 a dollar, 38 paise up from previous close of 44.11/12 on rising call money rates. In a volatile trade at the Forex market, the Indian currency resumed at 44.0650/0750 per dollar and rallied continuously during the day on the back of sustained buoyancy in the call money market and a 276-point rise in equity markets in intra-day trading. — PTI

Wockhardt
Mumbai, March 20
Wockhardt Ltd said today it had got approval to market painkiller tablets containing a combination of Dextro-propoxyphene napsylate and Acetaminophen in the US market. “Wockhardt is the world’s largest manufacturer of Dextro-propoxyphene and our products based on this drug are sold all over the world. This is our 16th ANDA approval and our first painkiller to be sold in the US,’ company’s chairman Habil Khorakiwala said. — PTI

OBC branch
Kangra, March 20
Himachal Pradesh transport and tourism minister G.S. Bali today inaugurated Oriental Bank Of Commerce (OBC) branch here today with CBS facilities. Atul Gautam, general manager and regional head of bank, said it was 15th branch of the bank in the state and 1234th in the country. The bank has planed to migrate all branches on CBS system shortly, he said. — OC

Airtel offer
Kumarhatti, March 20
Bharti Airtel today announced bonanza for cricket lovers in Himachal Pradesh. The company has launched “super sixes 666 easy recharge” for its prepaid subscribers. The subscribers who recharge with this pack will get six minutes of free Airtel-to-Airtel local airtime, every time an Indian batsman hits a six in the ongoing world cup. The plan comes with a cricket update pack, which will bring updates on of all cricket matches of India. — TNS

Oracle
Chandigarh, March 20
Oracle today announced tie- up with local partners in India to extend its global accelerate program to Indian small and medium businesses (SMBs). Oracle along with more than 50 partners is launching a new portfolio of more than 80 industry-specific applications solutions to address the needs of companies in more than 30 industry segments. These solutions are designed, packaged and priced for SMBs, with the aim of enabling SMBs to adopt modern technologies easily while reducing IT complexity and costs. — TNS

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