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THE TRIBUNE SPECIALS
50 YEARS OF INDEPENDENCE

TERCENTENARY CELEBRATIONS

B U S I N E S S

Nod to 26 pc FDI in Cos managing pension funds 
New Delhi, May 11  
Tough opposition from Left parties notwithstanding, the government has opened a window of opportunity for foreign companies for managing pension funds of central and state government employees.

Inflation dips to 5.66 pc
New Delhi, May 11
The monetary and fiscal measures initiated by the government appear to be bearing fruit with inflation dipping for the second week in a row to 5.66 per cent during week ended April 28 with a fall in prices of some essential food items.

Pak permits Indian cotton import via Wagah
Islamabad, May 11
In a bid to cut down costs for its dominant textile industry and make it more competitive, Pakistan’s Economic Coordination Committee has decided to permit the imports from India through Wagah and from its western borders to get the same from Uzbekistan.

Punjab to offer sops for industry
Chandigarh, May 11
Punjab will offer concession in sales tax and excise, besides power concessions, to all new industrial projects coming in the state including small and medium enterprises. The state will also create a land bank to offer land to industries willing to invest.
Japan's computer giant NEC employees display the new desktop-sized personal robot "Papero mini" 25cm tall, weighing 2.5kg, almost half the size of current model "Papero 2005" (right silver) at the company's laboratory in Kawasaki, suburban Tokyo on Friday. NEC developed the card-sized main control module to operate in recognition of the human voice, and to recognise human faces along with a graphic interface for LCD display Japan's computer giant NEC employees display the new desktop-sized personal robot "Papero mini" 25cm tall, weighing 2.5kg, almost half the size of current model "Papero 2005" (right silver) at the company's laboratory in Kawasaki, suburban Tokyo on Friday. NEC developed the card-sized main control module to operate in recognition of the human voice, and to recognise human faces along with a graphic interface for LCD display. — AFP


An employee of Christie's auction house displays a ruby and titanium brooch by Michele Della Valle in Geneva on Friday. Made of over 5,000 rubies and weighing almost 300 carats, the brooch is expected to fetch between $56,000 and $72,000 during a sale entitled "Magnificents Jewels" on May 16.
An employee of Christie's auction house displays a ruby and titanium brooch by Michele Della Valle in Geneva on Friday. Made of over 5,000 rubies and weighing almost 300 carats, the brooch is expected to fetch between $56,000 and $72,000 during a sale entitled "Magnificents Jewels" on May 16. — AFP 

EARLIER STORIES

 
A model launches range of fragrances by United Colors of Benetton in New Delhi late on Thursday. The perfume is available in sizes of 125 ml, 75 ml and 45 ml priced at Rs 1,935, Rs 1,495 and Rs 995, respectively. Tribune photo: Manas Ranjan
A model launches range of fragrances by United Colors of Benetton in New Delhi late on Thursday. The perfume is available in sizes of 125 ml, 75 ml and 45 ml priced at Rs 1,935, Rs 1,495 and Rs 995, respectively. Tribune photo: Manas Ranjan

Oracle to make cooperative banks competitive
New Delhi, May 11
  Oracle has launched an initiative to provide complete back-office solutions to co-operative banks in the country, which will address their core needs by helping them to increase operational efficiency and reduce costs.

HDFC chief rings NYSE bell
New York, May 11  
India's largest housing finance company, HDFC's chairman Deepak S Parekh has joined the ranks of global business leaders to ring the opening bell at the New York Stock Exchange (NYSE) here.

Industrial growth touches 11.3 pc
New Delhi, May 11
Despite high inflation and tightening of monetary policy by the RBI, overall industrial growth stood at 11.3 per cent during 2006-07.

RBI board meeting held
Shimla, May 11  
The central board of directors of the RBI met at Wildflower Hall, near here, yesterday. Various key economic and monetary issues and developments on the financial fronts were reviewed in the meeting. The hardening of rupee, rising interests rates and inflation were also discussed during the meeting held under the chairmanship of Governor of the bank Y.V. Reddy.

US investors prefer China over India
New Delhi, May 11  
India has lost out to China by a wide margin in terms of its appeal as an attractive market for the wealthy and affluent American investors, who are casting their net beyond the US in search for better returns.

Corporate Results
Hero Honda net down 27 pc

New Delhi, May 11  
Hero Honda Motors Ltd today reported a 27 per cent decline in its net profit for the quarter ended March 31 while its total turnover (net of excise) during the quarter grew by 16.75 per cent at Rs 2,684.09 crore, Hero Honda said. The board at a meeting today approved a final dividend of 850 per cent. 

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Nod to 26 pc FDI in Cos managing pension funds 

New Delhi, May 11
Tough opposition from Left parties notwithstanding, the government has opened a window of opportunity for foreign companies for managing pension funds of central and state government employees.

The foreign funds would be allowed to own up to 26 per cent stake in entities that will be set up by state-owned banks, mutual funds and financial institutions to manage the pension funds, sources said. The Left parties, which have been opposing the New Pension Scheme (NPS) that would be based on contribution by the employees, have said that only public sector entities should be entrusted with the task of managing the pension funds.

While the government has conceded this demand, it has allowed for FDI in the entities that will be floated by public sector institutions for the job.

The Pension Fund Regulatory and Development Authority (PFRDA), which has already appointed National Securities Depository Limited (NSDL) as the central record keeping agency, has invited preliminary bids to appoint pension fund managers.

Only financial institutions and banks in which government has at least 51 per cent share and manage assets worth Rs 10,000 crore, can apply.

The sources said the public sector financial institutions will, however, have to float separate companies for pension fund business.

These companies, which can have up to 26 per cent FDI stake, would need to have paid-up capital of at least Rs 10 crore. The last date for submitting expression of interest is May 25.

Once the pension fund managers are appointed, PFRDA will allow them access to the pension funds of employees of central government and state governments, said a PFRDA official.

He said the NSDL is already in the process of preparing a software, data base and network connectivity to manage all funds deposited under the NPS.

It will also give permanent retirement account number (PRAN) to the employees, that could be used by them to contribute and access pension funds even if they shift from one job to another.

Under the NPS, implemented for all central government employees except armed forces recruited since 2004, employees have to contribute 10 per cent of their basic salary and dearness allowance, along with a matching contribution of their employer.

The fund manager will offer alternative products to employees, including risk-free options under which funds would be invested in government securities, and share-market linked products with variable returns as well, sources said.

The government has claimed that 19 states except three Left-ruled states — West Bengal, Kerala and Tripura — have already implemented the NPS and are eagerly awaiting operationalisation of the scheme. — PTI 

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Inflation dips to 5.66 pc
Tribune News Service

New Delhi, May 11
The monetary and fiscal measures initiated by the government appear to be bearing fruit with inflation dipping for the second week in a row to 5.66 per cent during week ended April 28 with a fall in prices of some essential food items.

Inflation for the previous week was 5.77 per cent. Despite the inflation curve moving downwards, it is still far above RBI’s target level of 5 per cent.

The annual rate of inflation, calculated on point-to-point basis was just 3.90 per cent during the corresponding week of the previous year.

While prices of most items in broad categories of food products declined, those in manufactured rose a bit.

Prices of cereals declined by 0.2 per cent. Wheat and sugar was cheaper by 1 per cent. However, prices of pulses like moong rose by 2 per cent while that of masur and arhar by 1 per cent each.

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  Pak permits Indian cotton import via Wagah

Islamabad, May 11
In a bid to cut down costs for its dominant textile industry and make it more competitive, Pakistan’s Economic Coordination Committee has decided to permit the imports from India through Wagah and from its western borders to get the same from Uzbekistan.

The decision would be implemented in phases under which long staple cotton would be imported from India in the first phase and would be taken after carrying out a study that will determine if the farmers’community in Pakistan will be affected or not, media reports here said.

The meeting also asked the ministry of food agriculture and livestock to immediately install quarantine facilities at Wagah, which is required for the import. Pakistan is presently importing cotton from India through sea routes, which costs them an additional Rs 200 per mound. — PTI

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  Punjab to offer sops for industry
Ruchika M. Khanna
Tribune News Service

Chandigarh, May 11
Punjab will offer concession in sales tax and excise, besides power concessions, to all new industrial projects coming in the state including small and medium enterprises. The state will also create a land bank to offer land to industries willing to invest.

The new industrial policy, which is currently being chalked out by the key functionaries in the government, will also focus on confidence building measures for the industries existing in the state. Focus will be on attracting investment in manufacturing and services sectors, rather than in real estate. This was revealed by the state industries and commerce minister Manoranjan Kalia, during an interview with The Tribune here today.

Elaborating on the blue-print of the new policy, he said being land-locked between Himachal Pradesh, Jammu and Kashmir and in proximity of Uttaranchal, Punjab does not have a level playing field to attract investments. “We have asked for a central package for industries in Punjab. But even if the center declines our request, we will be going ahead with tax concessions for new investors and investments by the existing industries,” he said.

The new policy would also dwell on cluster approach. There is already a demand for a cluster in Mandi Gobindgarh (for steel) and in Ludhiana and Dera Bassi (for textile). The government also believes that being an agrarian economy, agro-based industry should be encouraged in the state.

“We will soon be implementing the Industrial Felicitation Act, 2005. Instructions have already been issued to frame the rules, which will allow single window clearance system for investors,” said Kalia.

He also said fertile agriculture land will not be included for creating the land bank. Only barren land and land pertaining to focal points will be used for the said purpose.

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Oracle to make cooperative banks competitive
Tribune News Service

New Delhi, May 11
Oracle has launched an initiative to provide complete back-office solutions to co-operative banks in the country, which will address their core needs by helping them to increase operational efficiency and reduce costs.

With the help of Oracle-certified partner EBZ Online Private Limited (EBZ Online), Oracle will offer complete and affordable IT solutions to all categories of co-operative banks in India, including community banks, credit unions, urban and rural co-operative and agricultural banks. Oracle plans to set up a co-operative banking centre of excellence, in partnership with EBZ Online, to extend its focus on the co-operative banking space, a release said.

With the help of Oracle and EBZ Online applications, co-operative banks in India will, for the first time, be able to consolidate their transactions on a daily basis. Daily consolidation of transactions was earlier difficult given the operations model of these banks, their geographical spread and low IT penetration.

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HDFC chief rings NYSE bell 

New York, May 11
India's largest housing finance company, HDFC's chairman Deepak S Parekh has joined the ranks of global business leaders to ring the opening bell at the New York Stock Exchange (NYSE) here.

Parekh rung the bell at the NYSE yesterday to mark the beginning of trading at the bourse. A number of corporate leaders from India such as Satyam chairman B Ramalinga Raju and Wipro chief Azim Premji have earlier done the honours.

The HDFC chief would also be honoured today by the American Indian Foundation (AIF), a non-profit group working toward accelerating social and economic change in India.

HDFC was listed on NYSE on July 20, 2001, after an initial public offer of its American Depositary Shares in the US.

The foundation is hosting its annual Spring Awards Gala to raise funds for its development work in India in the fields of education, livelihood and public health.

"With strong support from Indo-centric individuals and corporations in the US, AIF is in a truly unique and exciting position to have a meaningful and lasting impact in India," AIF executive director Pradeep Kashyap said in a statement.

Besides Parekh, AIF is honouring American International Group (AIG) Inc president and CEO Martin J Sullivan for their philanthropy and leadership. — PTI

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  Industrial growth touches 11.3 pc 
Tribune News Service

New Delhi, May 11
Despite high inflation and tightening of monetary policy by the RBI, overall industrial growth stood at 11.3 per cent during 2006-07.

The Index of Industrial Production (IIP) during March posted a growth of 12.9 per cent as against 8.9 per cent in the corresponding month last year. Industrial output during 2005-06 stood at 8.2 per cent, according to figures released by Central Statistical Organisation (CSO) today.

As many as 10 out of 17 industry groups showed double digit growth during the financial year. These include wood and wood products (29.1 per cent), basic metal and alloy industry (22.8 per cent), transport equipment and parts (14.9 per cent), cotton textiles (14.8 per cent) and machinery other than transport (14 per cent).

The other industry groups recording double digit growth during 2006-07 are non-metallic mineral products (12.8 per cent), rubber, plastics, petroleum and coal products (12.7 per cent), metal products and parts (11.4 per cent) and beverage, tobacco and related products (11.3 per cent).

While power sector recorded a growth of 7.2 per cent during the year, index for mining sector went up by 5.1 per cent. Power and mining sectors had grown by 5.28 per cent and one per cent respectively during 2005-06.

The sectors, which did not perform well during the year, are jute and other products excluding cotton (-17.2 per cent) and leather products (0.3).

CSO statistics reveal that a turnaround in crude oil output and higher production by refineries pushed the growth of six infrastructure industries to 8.6 per cent in 2006-07.

The crude production, which had declined by 5.3 per cent in 2005-06, increased by 5.6 per cent in 2006-07. Similarly, output of refineries grew by 12.6 per cent.

In March 2007, growth of core sector was 10 per cent as against 7.1 per cent in the same month last year. Increase in growth during the last month of 2006-07 was due to better performance of steel, whose production increased by 15 per cent. Besides, electricity grew at 8 per cent and refinery at 13.4 per cent.

The growth in production of cement, however, fell in March 2007 to 5.5 per cent from 17 per cent in the same period last year. During 2006-07, growth in cement production slowed down to 9.1 per cent from 12.4 per cent in 2005-06.

Electricity sector grew by 7.3 per cent in 2006-07 as against 5.1 per cent in 2005-06. Import of power from Bhutan also contributed to the growth.

Steel production grew at a marginally slower rate of 10.9 per cent in 2006-07 against 11.2 per cent in 2005-06. 

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RBI board meeting held
Tribune News Service

Shimla, May 11
The central board of directors of the RBI met at Wildflower Hall, near here, yesterday. Various key economic and monetary issues and developments on the financial fronts were reviewed in the meeting. The hardening of rupee, rising interests rates and inflation were also discussed during the meeting held under the chairmanship of Governor of the bank Y.V. Reddy.

The board met at Shimla after a gap of 12 years. The last meeting was held in 1995. 

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  US investors prefer China over India

New Delhi, May 11
India has lost out to China by a wide margin in terms of its appeal as an attractive market for the wealthy and affluent American investors, who are casting their net beyond the US in search for better returns.

Indicating increased interest of wealthy persons in investing abroad, two of every five affluent households in the US expect to invest or continue investing in overseas markets, according to a new study released yesterday.

While China has emerged as the most appealing overseas destination for the affluent American investors, India can find a place only at the fourth position on their radar.

In the survey carried out by US-based strategic consulting firm focused on affluent markets, Spectrem Group, nearly one-third (31 per cent) said they have increased their foreign investments from the past, while a similar proportion is planning to increase its overseas investment in the future.

The affluent households, defined as having more than $5 lakh of investable assets, named India as the fourth most appealing market on their international investment radar, after China, Europe and Japan.

When asked which countries or areas appealed to them the most for investment purposes, the households named China as their most preferred destination (30 per cent), followed by 20 per cent going for Europe, 12 per cent for Japan and 11 per cent for India.

According to the survey, parking the money in international markets has emerged as a more popular option than some well-known alternative investment avenues like hedge funds, venture capital, private placements and REITs (Real Estate Investment Trusts).

Even India scored over the hedge funds, which got support from just 8 per cent of the respondents. — PTI

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Corporate Results
Hero Honda net down 27 pc

New Delhi, May 11
Hero Honda Motors Ltd today reported a 27 per cent decline in its net profit for the quarter ended March 31 while its total turnover (net of excise) during the quarter grew by 16.75 per cent at Rs 2,684.09 crore, Hero Honda said. The board at a meeting today approved a final dividend of 850 per cent. For the year ended March 31, Hero Honda’s net profit dipped by 11.67 per cent at Rs 857.89 crore and the total turnover during the fiscal stood at Rs 10,089.81 crore, up by 13.7 per cent year-on- year.

Novartis India

Novartis India today posted a net profit of Rs 23.87 crore and the total income was Rs 144.64 crore for the fourth quarter ended March 31, Novartis India informed the BSE. The board of directors at its meeting today declared interim dividend of 200 per cent as final dividend.

Blue Star

Blue Star Limited today reported a 46 per cent growth in its net profit in 2007 at Rs 71.18 crore on a total income of Rs 1,607 crore, up by 36 per cent from last year. The board of directors have recommended a final dividend of Rs 0.60 per share over and above the interim dividend of Rs 2.40 paid in March.

S Kumars PAT up

S Kumars Nationwide Limited (SKNL) has clocked a 147.39 per cent increase in its profit after tax (PAT) at Rs 123.52 crore for 2006-07 and its turnover was up by 38.19 per cent at Rs 1,229.54 crore, the company said. For the quarter ended March 31, 2007, the company’s sales was up by 49.9 per cent from Rs 247.89 crore to Rs 371.66 crore while its PAT stood at Rs 37.88 crore as against Rs 22.76 crore in the corresponding period of the previous fiscal.

Asian Paints

Asian Paints has posted over three-fold increase in net profit at Rs 71.15 crore for the fourth quarter ended March 31, as compared to Rs 20.28 crore for the same quarter last year.

The total income (net of discounts and excise) grew 27.86 per cent to Rs 740.26 crore for the quarter from Rs 578.93 crore for the corresponding quarter a year ago, Asian Paints informed the BSE.

The board of directors at its meeting today declared 10 per cent final dividend of one rupee on shares of Rs 10 each for the financial year ended March 31, 2007.

Finolex Cables

Finolex Cables has reported a net profit of Rs 8.83 crore for the fourth quarter ended March 31, against Rs 21.02 crore for the same period a year ago.

Total income (net of excise) of the firm stood at Rs 295.82 crore for the January-March quarter while the same was at Rs 231.22 crore for the quarter ended March 31, 2006, Finolex informed the BSE.

Meanwhile, Finolex Cables board recommended 70 per cent dividend at Rs 1.40 per equity share of Rs 2 each fully paid up, for the financial year ended March 31.— Agencies

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BRIEFLY

SBI Mutual Fund
New Delhi, May 11
Capitalising boom in the infrastructure sector, the SBI Mutual Fund today launched a three-year close-ended growth fund to invest in equity stocks of companies directly or indirectly involved in the sector. The offer opens for subscription today and will close on June 8. The scheme allows the investors to choose dividend and growth options, tax free dividends and automatic conversion into open-ended scheme on maturity. The fund would primarily invest in a diversified basket of equity stocks of companies directly or indirectly involved in infrastructure, debt and money market instruments. 

Gaming portal
Hyderabad, May 11
7Seas Technologies Ltd will launch its on-line gaming portal on May 13, claiming to be first of its kind in the world with Indian characters and multilingual options. Initially hosting 100 games to play on portal ‘www.onlinerealgames.com’, it would plan to upgrade it to 300 games within a year. The beta version of the portal already has about three lakh registered users, according to company’s managing director L Maruti Sanker.

Reliance Comm
Mumbai, May 11
Reliance Communications has sold one million low-cost 'Classic' handsets within a week of its launch. The company had last week launched its Classic handsets with a price tag of Rs 777. "By crossing the one million handset mark in just a week, we have set a new record in the industry," RCoM president (personal business) S P Shukla said.

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