Mumbai, May 29
The government will have a more liberal foreign direct investment (FDI) policy in place soon as a review of the country’s current FDI policy be finalised in the next few months.

“The results of the review will be in direction of liberalisation, as was the case with similar policy reviews in the past,” Department of Industrial Policy and Promotion secretary Ajay Dua said here today.

Speaking on the ‘Investment scenario in India’ at plenary session of a CII-sponsored seminar here, he outlined growing attraction of India as an investment destination and identified six sectors that have tremendous potential. These are automobiles and auto ancillaries, IT and IT-enabled services, pharmaceuticals, biotechnology, food processing and telecommunications.

Dua said FDI is coming into the telecom sector in a big way now. In all these sectors, the basis for optimism about future growth stemmed from India’s cost competitiveness and supply side strengths, including a large intellectual capital base and expanding domestic market.

Dua said, India had deliberately followed a process of calibrated liberalisation of its FDI regime. Before 1991, FDI was allowed in selective sectors up to 40 per cent.

This went up to 51 per cent under the automatic route for 35 priority sectors in 1991. In 1997, it was decided to allow up to 74 per cent in 111 sectors and 100 per cent in some sectors, he said.

In 2000, up to 100 per cent FDI was allowed under the automatic route in all sectors except a negative list. After 2000, more sectors have been opened up, equity caps raised and conditions relaxed, he said.

There were no restrictions on FDI in the manufacturing sector, where up to 100 per cent FDI had been allowed, Dua added. — PTI

Mumbai, May 29
The centre today said it was working on a "scheme" to refund the local taxes and levies to labour- intensive industries with little import component to offset the impact of rupee, which touched a nine-year high yesterday.

"Rupee is at an all-time high which is a cause for concern... we are looking at framing a scheme to refund the levies and taxes to neutralise the impact and help the exporters of labour-intensive sectors with no or very little import component," commerce and industry minister Kamal Nath said on the sidelines of the third India-GCC Industrial Forum here.

"It is a matter of concern not only to our exporters but also to our manufacturers as there is a possibility of cheaper imports replacing manufactured products," he told reporters.

The rupee was trading at 40.45/46 per dollar in late morning trade, off Monday's peak of 40.28, its highest level in nine years.

The minister, however, felt that India Inc has built up the resilience and the competitiveness to absorb the effect of appreciating rupee. He said his ministry was in talks with the Reserve Bank of India and the export council to define the way forward.

Asked on the impact of the rising rupee on trade deficit, the minister said it was likely to remain neutral as cheaper oil imports were likely to balance the export reduction.

Nath said SEZs, which were the engines for growth, are here to stay. "The government has one thing on SEZs that SEZs are here to stay. The question is land acquisition. There could be no compulsory land acquisition," Nath said. The whole rehabilitation policy is being relooked at, he added.— PTI

New Delhi, May 29
It’s raining dollars on the bourses, with the total wealth invested in Indian stock markets crossing the $1 trillion milestone, small investors’ share in the country’s five most-valued firms worth as much as $10 billion.

According to the information available with the stock exchanges, small investors, defined as those who can invest up to a nominal amount of Rs 1 lakh in a company, hold close to $10 billion (Rs 40,500 crore) worth shares in the top five companies in terms of market capitalisation.

The combined market value of Reliance Industries, ONGC, Bharti Airtel, NTPC and TCS account for more than 20 per cent of the entire investors’ wealth of just over $1 trillion, while remaining 80 per cent being spread across over 4,800 publicly traded entities.

The combined market value of the five biggest companies, has soared past $210 billion, which represents nearly 20 per cent of the cumulative market value of all companies listed on the BSE.

Despite owning so much in these companies, small investors still remain tiny players on the bourses as majority of the wealth created is going into the kitty of promoters, institutional investors, high-net worth individuals and large investors.

According to an analysis of market value figures and shareholding patterns available with the bourses, the $10 billion worth shares held by small investors in the top five firms accounts for less than 5 per cent of these firms’ combined market value of about $210 billion.

Small investors own shares worth $6.7 billion in the country’s most valued firm Reliance Industries (RIL), which is nearly two-third of their total wealth in the top five companies.

RIL is followed by TCS with $1.4 billion of small investors’ wealth, while ONGC, Bharti Airtel and NTPC together add nearly $1.9 billion to their kitty.

Shares held by promoters worth close to $145 billion in the top five companies, while total public holding in these companies, including large and small individual investors as well as domestic and foreign financial institutions, is worth about $65 billion.

The information available with the bourses shows that small investors hold an average of 9.5 per cent stake in the 30-sensex companies and nearly 11.5 per cent of the BSE 500 companies.

Their average holding across the market is close to 22 per cent, but it does not translate into much wealth creation as their larger shareholdings are mostly in companies which have nominal market values. — PTI

New Delhi, May 29
The government today appointed V Thulasidas as chairman and managing director of the merged Air-India with present chairman cum managing director of Indian (Airlines), Vishwapati Trivedi, being made the joint managing director of the new entity.

The government had, earlier in the year, approved the merger of the two public sector airlines with a view to conceptualise a new company to take on the emerging competition from within the country and as well as from foreign airlines. The merged airline is expected to be in place by mid July this year.

However, it may still take time to bring about complete synergy in working of the two airlines together.

According to the decision, Thulasidas and Trivedi will continue as chairman and managing director of Air-India Ltd, and Indian Airlines Ltd respectively, till the merged entity comes into being.

Last week, the government had decided to continue with the name of Air-India for the merger and to keep the quintessential turbaned and mustachioed Maharaja as the mascot for it. The merged entity would have single code AI and famous IC code for Indian would cease to exist.

Logo of the new airline has been selected as the Flying Swan with the Konark Chakra placed inside it.

The Flying Swan has been morphed from Air-India’s characteristic logo, ‘The Centaur’, whereas the ‘Konark Chakra’ is reminiscent of Indian’s logo. The merged entity will have 111 new aircraft (68 Boeing and 43 Airbus) over the next three years.

New Delhi, May 29
India's prowess in the BPO space continues to win accolades at the global arena with three Indian companies - Wipro, Bharti Airtel and Bank of India — bagging the Outsourcing Excellence Awards, dubbed as 'Oscars of outsourcing'.

The awards, presented by the online community Outsourcing Center, are given for the world's best outsourcing arrangements.

Wipro-Nortel Networks, Bank of India-Hewlett Packard and Bharti Airtel-Nortel Networks combine are among the nine winners for this year, US-based consultancy firm Everest Group said.

The Everest Group and US-based business magazine Forbes are sponsors of the awards, which would be presented in New York in August.

While Wipro-Nortel have been awarded the “Best Offshore” award for their 15-year old partnership, BoI-HP won the ‘Best IT Infrastructure’ award for implementing a core banking solution a year ahead of the schedule and Bharti-Nortel combine have been recognised for as the “Best First Steps” award for best practices. — PTI

New Delhi, May 29
Joining the clutch of global auto majors who source components from India, German luxury car maker BMW today said it would open its international purchasing office here to cater to its worldwide ancillaries requirement.

“We will be setting up an international purchasing office (IPO) which will be headed by an expert to take care of sourcing components for BMW’s global operations,” BMW (India) president Peter Kronschnabl told reporters here.

He said the office was expected to be operational by August this year.

BMW currently has a purchase unit for its India operations at Chennai.

Kronschnabl said the new purchasing office would be independent of the India operations and would directly report to Munich headquarters.

He added that currently BMW sources some IT components from India and with the setting up of the new international purchasing office, the company was looking to expand the basket of products sourced from India.

BMW India’s purchase office and international purchasing office could work in tandem, he said, adding that the two may individually approach vendors or together depending on products. — PTI

Shimla, May 29
The Council of Small Industries Corporations in India, an apex body of government undertakings, has urged the union ministry of steel to allocate a higher quantity of steel to the corporations for supply to the small-scale units.

The annual general meeting of the council, held here today, reviewed the steps already being taken to develop and set up small-scale industries in various states of the country and the measures which further need to be taken in this regard. The meeting considered the supply of raw materials, specially the iron and steel material, to the small scale industrial units.

The members attending the meeting also decided that the steel suppliers, including SAIL and RINL, be requested to extend greater cooperation to the state corporations and remove unnecessary hurdles in the supply of the required quantity and quality of steel materials which were required by the small-scale units.

The meeting also reviewed the overall functioning of the council and considered necessary steps to improve its financial health. Sanjay Gupta, MD of the State Small Industries and Export Corporation, was unanimously elected as chairman of the council.

Sangrur, May 29
Union minister of state for finance Pawan Kumar Bansal today inaugurated a branch of the Allahabad Bank here. This is the 44th branch of the bank in Punjab and 2074th in the country. Chairman and managing director of the Allahabad Bank Avinash Chander Mahajan was also present on the occasion.

After inaugurating the branch, while talking to mediapersons the minister said banks had played a big role in the country’s economy. He said sustaining of economic growth rate at 9.2 per cent was not only a difficult task but also a big challenge before the Union Government.

He said the government wanted to increase the economic growth rate to 10 percent but it could not be achieved till the agriculture growth rate of the country rose to 4 per cent from the existing 2 per cent.

The minister also said the union government had fixed a target to provide loans worth Rs 2, 25,000 crore for agriculture purposes during the current financial year.

The CMD of the bank, Avinash Chander Mahajan, said by the end of March 2008, the bank would open 25 more branches in Punjab. He said the Allahabad Bank had fixed a target to open 100 branches in Punjab.

Barnala: Meanwhile, the bank also opened its branch here today. Union minister of state for finance, Pawan Kumar Bansal, inaugurated the branch. On the occasion, he also distributed bank’s loan sanction letters to the tune of Rs 3 crore.

Mumbai, May 29
State-run oil refiner Hindustan Petroleum Corp has announced a 72.7 per cent dip in net profit for the fourth quarter ended March 31 at Rs 549.54 crore, compared to Rs 2,013.41 crore for the same period in the previous fiscal.

Total income (net of excise), however, rose 5.3 per cent to Rs 22,045.94 crore for the January-March quarter as against Rs 20,943.15 crore for the corresponding period last fiscal, HPCL informed the BSE.

Meanwhile, the board of directors of the company has recommended a final dividend of 120 per cent, in addition to the interim dividend of 60 per cent paid in December 2006, HPCL added.