SPECIAL COVERAGE
CHANDIGARH

LUDHIANA

DELHI




THE TRIBUNE SPECIALS
50 YEARS OF INDEPENDENCE

TERCENTENARY CELEBRATIONS
B U S I N E S S

Mittal gets nod for 49 pc stake in Bathinda refinery
New Delhi, June 21
The Union Cabinet today allowed steel baron Lakshmi Mittal to pick up 49 per cent stake in state-run Hindustan Petroleum Corporation's (HPCL's) Bathinda refinery. The investment by Mittal of Rs 3,506 crore (or about 5 per cent of total FDI in 2006-07) is the first and the largest foreign direct investment (FDI) brought into the petroleum refining sector in collaboration with a PSU.
A view of the main gate of Guru Gobind Singh Refinery at Bathinda A view of the main gate of Guru Gobind Singh Refinery at Bathinda.
— Tribune photo by Kulbir Beera

Rupee surge hits exporters hard
Jalandhar, June 21
The sharp decline of the US dollar has not only pushed the Indian rupee at its highest level in nine years, but, it has also instilled a fear-psychosis among the exporters of Punjab and of the entire region.



 

EARLIER STORIES

 
Bollywood actress Neha Dhupia poses with a newly launched Hewlett-Packard (HP) iPAQ512 voice messenger in New Delhi
Bollywood actress Neha Dhupia poses with a newly launched Hewlett-Packard (HP) iPAQ512 voice messenger in New Delhi on Thursday. The iPAQ will be available for Rs 14,000. The voice messenger has Microsoft Windows Mobile 6.0 with push mail and office applications, built-in-camera, MP3 player and video recorder. The user does not have to type or voice the e-mail. The messenger will reply to send voice e-mail responses as well as read out SMSs and e-mails. — Tribune photo by Manas Ranjan

GAIL to invest Rs 28,000 cr
Kolkata, June 21
Gas Authority of India Limited (GAIL) would invest around Rs 28,000 crore for laying seven pipelines across the country by 2011, chairman and managing director of the company UD Choubey said today.

  • Inks JV with IndianOil

Jindal Group’s Rs 9,000-cr project cleared
Hyderabad, June 21
Undeterred by protests from environmentalists and opposition parties, Andhra Pradesh cabinet has given a go-ahead for the Rs 9,000-crore aluminium project in Vizianagaram district, which is to be developed by Jindal Group.

No irregularities in forthcoming IPOs expected: SEBI
New Delhi, June 21
Exuding confidence that steps taken in the aftermath of multi-demat IPO scams will address the issues of misconduct in the public issues, market regulator SEBI today said it does not expect any major irregularities in the forthcoming IPOs.

IT sector to come under tax net in AP
Hyderabad, June 21
The booming IT industry in Andhra Pradesh, ranked fourth in the country, is set to come under the tax net. Taking a cue from Karnataka and Tamil Nadu, the state government is considering imposition of Value Added Tax (VAT) on IT and ITeS sales and exports.

Software to boost grape export launched
New Delhi, June 21
A new web-based software ‘Grapenet’, that will provide traceability regarding the table grapes exported from India to European Union (EU), was launched by minister of state for commerce Jairam Ramesh here today.

SpiceJet pilots to fly Oman Air
Dubai, June 21
Oman Air has entered into a strategic tie-up with SpiceJet under which pilots of the Indian carrier would fly planes of the former. “Representatives of Oman Air were recently in India looking for a partner, who can provide us with well trained quality Boeing 737 pilots,” the gulf airline’s senior manager (line operations) Captain Hamed Al Jabry said in a press release.

Essar concludes Algoma takeover
New Delhi, June 21
Essar Global today said it has completed the acquisition of Canadian steel maker Algoma Steel Inc for over Rs 7,071.33 crore, that will bring new dimension to its marketing operations in North America.





Top








 

Mittal gets nod for 49 pc stake in Bathinda refinery
Tribune News Service

New Delhi, June 21
The Union Cabinet today allowed steel baron Lakshmi Mittal to pick up 49 per cent stake in state-run Hindustan Petroleum Corporation's (HPCL's) Bathinda refinery.

The investment by Mittal of Rs 3,506 crore (or about 5 per cent of total FDI in 2006-07) is the first and the largest foreign direct investment (FDI) brought into the petroleum refining sector in collaboration with a PSU.

Union petroleum minister Murli Deora told The Tribune that the Cabinet decision would result in speedy implementation of the Bathinda refinery project, which has been hanging fire for the past several years.

He said the setting up of the refinery would result in the creation of large number of direct and indirect employment in Punjab.

Mittal Investments plans to acquire the stake in the refinery for Rs 3,365 crore through its wholly owned subsidiary Mittal Energy Investments Pte Ltd, incorporated in Singapore.

The Cabinet approval was required since current government policy restricts FDI in public sector petroleum refineries to up to 26 per cent.

HPCL will hold 49 per cent stake in the Rs 17,973-crore Bathinda refinery project being executed by Guru Gobind Singh Refinery Ltd, while the balance 2 per cent would be allocated to financial institutions.

Before striking a deal with a Mittal company, HPCL had wooed 17 overseas firms, including Britain's BP Plc, seeking a partner for Bathinda but had been repeatedly rebuffed.

The project approved by the Cabinet Committee on Economic Affairs (CCEA) consists of a 9 million metric tonne per annum (MMTPA) refinery, 1,000 km crude oil pipeline from Mundra to Bathinda and single point mooring (SPM) & crude oil terminal at Mundra.

The ‘As built’ cost assessed by SBI Caps is Rs 18,919 crore. Each partner, HPCL and MI (through MEI), will contribute 49 per cent equity individually of Rs 3,506 crore each and balance 2 per cent equity of Rs 143 crore will be taken by Indian financial institutions.

Mittal investment will put the project on a fast track. It will create a lot of jobs directly and indirectly in the state of Punjab. There will be industrialisation and development of support industries. It will also improve the level of oil security in the area.

For HPCL, the investment by Mittal will allow HPCL to use its capital for other planned expenditure. Also, HPCL will leverage the strength of Mittal in globalising its operations as well as seeking equity oil abroad.

Top

 

Rupee surge hits exporters hard
Varinder Singh
Tribune News Service

Jalandhar, June 21
The sharp decline of the US dollar has not only pushed the Indian rupee at its highest level in nine years, but, it has also instilled a fear-psychosis among the exporters of Punjab and of the entire region.

They apprehend that the unprecedented situation could cause huge losses to their capital due to sharp devaluation of the dollar and rise of the Indian currency.

At the same time, rupee has become more stronger and has gone up by more than 10 per cent in the international market, causing a depreciation of dollar and an export loss of Rs 100 crore in respect of engineering exports alone during the past four months.

The profitability in the export business of the small and medium enterprises (SMEs) has almost become a story of the past, particularly when small-scale export companies, especially in the northern region, had experienced 10 per cent currency conversion loss.

Besides, the steel cost along with other inputs have gone up during the first quarter of the current financial year by more than 10 per cent and the freight for bringing the inputs and sending the goods for export has also gone up by more than 5 per cent. In addition to the above loss, the other indirect taxes, such as service tax on export goods, foreign agents’ commission, as well as container transportation cost have further added to the woes of small exporters. Since the bills on this account have risen by more than 20 per cent, the average net profit of the small exporting companies, having turnover of up to Rs 100 crore, have gone down by 20 per cent, observes Phagwara-based Ashwani Kohli, senior vice- president of the Punjab Chamber of Small Exporters.

According to the exporters, their net profit margin revolved around 5 to 6 percent. Hence, these accumulated losses of more than 20 per cent have made the ground slippery for the small and medium enterprises, as the rupee was becoming stronger with each passing day and moreover the Indian exporters were facing competition from their counterparts in China, Taiwan, Thailand and Pakistan, where the currency rates haven’t fluctuated by more than 3 per cent.

According to the exporters, the diesel engine and tractor industry in Punjab has lost around one-third of their share of exports to the West Asia and Latin American countries in the first quarter . “The leather industry in Punjab, having export turnover of around Rs 500 crore is the worst sufferer due to the depreciation of US dollar,” said Atamjit Bawa, a leading leather goods exporter and manufacturer of Jalandhar.

Top

 

GAIL to invest Rs 28,000 cr

Inks JV with IndianOil

Gail (India) Ltd has forged a joint venture with IndianOil Corporation (IOC) for gas distribution in Kolkata and other towns, chairman and managing director of the company U D Choubey said today.

Choubey said the new company would be incorporated shortly and the estimated investment would be around Rs 500 crore.

GAIL and IOC would hold 22.5 per cent each. Other equity partners are the West Bengal government (five per cent) and financial institutions (50 per cent). Choubey said gas distribution would be possible only after completion of Jagdishpur-Haldia pipeline in 2011.

Kolkata, June 21
Gas Authority of India Limited (GAIL) would invest around Rs 28,000 crore for laying seven pipelines across the country by 2011, chairman and managing director of the company UD Choubey said today.

Choubey said the government had given in-principle clearances for seven pipelines, which would increase its network from 6,400 kms to 11,500 kms.

He said the project would be implemented in two phases.

While the first phase entailed an investment of Rs 10,000 crore and would be completed by 2009, the second phase would see an investment of Rs 18,000 crore by 2011.

On completion of the two phases, gas transportation capacity of GAIL would increase from 140 million cubic metres per day to 220 million cubic metres per day.

Choubey said these investments would be funded largely from borrowings, while internal accruals would also be used for part-financing the project.

In the second phase, GAIL would lay the 890-km long Jagdishpur-Haldia pipeline. It would serve the industrial belts of Gorakhpur, Barauni, Durgapur and Haldia.

He said by 2011, GAIL’s revenue would increase to Rs 45,000 crore from the present level of Rs 16,000 crore.

Regarding sourcing of gas, Choubey stated GAIL had entered into agreements with ONGC, Reliance Industries and Shell Hazira for supplies from eastern coast and Hazira terminal. — PTI

Top

 

Jindal Group’s Rs 9,000-cr project cleared
Tribune News Service

Hyderabad, June 21
Undeterred by protests from environmentalists and opposition parties, Andhra Pradesh cabinet has given a go-ahead for the Rs 9,000-crore aluminium project in Vizianagaram district, which is to be developed by Jindal Group.

A cabinet meeting, chaired by Chief Minister YS Rajasekhar Reddy, approved allotment of 1,048 acres of the government and assignment lands to Jindal South-West (JSW) Aluminium Limited and also an attractive resettlement and rehabilitation package for 600 families who will be displaced by the project.

Under the package, one member in each family would get a job commensurate with their qualification and Rs 3 lakh to those who do not opt for a job, information minister A Ramanarayana Reddy said.

The oustes would also get a house from the company on a 45 sq metre floor area. In case, the displaced family wants to settle elsewhere, an amount of Rs 1.5 lakh would be paid to them, the minister said. Apart from offering shares, the company would also pay a wage component of Rs 3,800 per month to each displaced family for a year.

In July 2005, the state government had signed a Memorandum of Understanding (MoU) with JSW Aluminium Limited, which is part of the Rs 18,000 crore OP Jindal Group, for setting up a 1.4 million tonne aluminium refinery and smelter plant in Sringavarapukota mandal, bordering Orissa. At present, the company has three plants — two in Maharashtra and one in Karnataka — and commands 15 per cent market share.

The cabinet gave its nod for land allotment at the rate of Rs 2 lakh per acre for the government dry land and Rs 2.25 lakh an acre for wet land. For assignment lands, the company will have to pay an ex-gratia of Rs 2 lakh per acre to the assignee in addition to Rs 75,000 per acre to the government.

Top

 

No irregularities in forthcoming IPOs expected: SEBI

New Delhi, June 21
Exuding confidence that steps taken in the aftermath of multi-demat IPO scams will address the issues of misconduct in the public issues, market regulator SEBI today said it does not expect any major irregularities in the forthcoming IPOs.

"Those (issues thrown out by multi-demat IPO scams) have been addressed. We have put in place several steps," SEBI chairman M Damodaran told reporters on the sidelines of a seminar on financial planning here.

"Our expectation is that we will not see anything on that scale. Should somebody choose to misconduct, we know how to deal with it," he said.

While over Rs 9,000 crore issue of real estate company DLF is expected to be listed by the first week of July, over Rs 9,000 crore ICICI Bank's follow-on offer is open for subscription currently. Spice Telecom is also coming out with around Rs 500 crore IPO.

Starting from detection of irregularities in the Yes Bank issue in December 2005, SEBI had found that in many issues quota fixed for retailers were cornered by a group of players through opening of multiple fictitious demat accounts.

SEBI had looked into 105 IPOs during 2003-05, beginning with Maruti and those of industry majors like TCS, NTPC, Jet Airways, Yes Bank and IDFC.

Later, the market regulator through an interim order had banned 12 depository participants from opening fresh demat accounts for a specified period, even as investigations continued in these cases.

Also, SEBI asked NSDL and CDSL, besides eight depository participants to cough up Rs 115.81 crore for their involvement in these scams.

Short-selling by financial institutions soon

Meanwhile, SEBI today said it would soon issue guidelines on short-selling that will enable institutional investors to sell stocks without owning them.

"Individuals are allowed to short-sell, we are extending it to financial institutions, including mutual funds, soon," SEBI chairman M Damodaran told reporters here.

The guidelines are being finalised and will be issued soon, he said without specifying the date.

The market watchdog at its board meeting held on March 22 had allowed short-selling by institutional investors, both domestic and foreign. However, the relevant guidelines will come out shortly.

The decision on short-selling, followed the announcement by finance minister P Chidambaram in the Budget on February 28. The SEBI-appointed secondary Market Advisory Committee, had also recommended short-selling by institutional investors in October 2005.

It is believed that initially short-selling would be permitted only on those stocks in which derivative products are available.

The introduction of short-selling is likely to benefit the market in more ways than one. Apart from improving efficiency and liquidity, it will also help increase participation in a falling market since institutions will try to take advantage of such a market by going short, thus improving the market depth. — PTI

Top

 

IT sector to come under tax net in AP
Tribune News Service

Hyderabad, June 21
The booming IT industry in Andhra Pradesh, ranked fourth in the country, is set to come under the tax net.

Taking a cue from Karnataka and Tamil Nadu, the state government is considering imposition of Value Added Tax (VAT) on IT and ITeS sales and exports.

“We will hold talks with representatives of the IT industry before taking a final decision. It will not be an across-the-board levying of tax but will be area-specific,” the minister for commercial taxes K Ramakrishna said.

The officials have been asked to identify specific areas in IT and BPO sectors where tax can be levied and also to study the pattern in vogue in neighbouring states. The flourishing IT industry has all along enjoyed tax exemption from successive governments.

The move comes in the backdrop of the Supreme Court’s recent suggestion that service tax could be collected from IT companies.

The last one decade had been a roller-coaster ride for IT industry in the state with exports touching a whopping Rs 18,582 crore in 2006-07, compared to a mere Rs 284 crore in 1997-98.

The state is home to several leading global IT and BPO companies and stands fourth in the country in terms of software exports after Karnataka, Maharashtra and Tamil Nadu. It accounts for 14 per cent of the country’s total exports.

Top

 

Software to boost grape export launched
Tribune News Service

New Delhi, June 21
A new web-based software ‘Grapenet’, that will provide traceability regarding the table grapes exported from India to European Union (EU), was launched by minister of state for commerce Jairam Ramesh here today.

The software, developed by the APEDA, will help in raising confidence of the importers by monitoring pesticide residue and achieving product standardisation and, thus, boost grape exports to EU.

The software works on the regulations of tracing back the origin of the produce in reverse order from shelf to farm at the click of mouse.

“Now, the importers and export regulation authorities, both abroad and in the country, will be able to access the information at one’s convenience about any grape export transaction,” Ramesh told newspersons.

Similar web-based software would be developed in the near future for mango and pomegranate to boost their exports, the minister said.

Giving details about the software, APEDA director S Dave said by clicking the phytosanitary or agmark no, one can directly reach certificate issuing authorities, inspection reports to laboratory analysis, certificate of residue analysis and pack house details.

“The software is designed to reach at the bottom of any grape export transaction and the website could be accessed by any registered importer from across the world,” Dave said.

APEDA had undertaken the ‘grapenet’ initiative subsequent to the issuance of 17 rapid alert notifications by the EU on grounds of detection of high levels of pesticide residues in Indian grapes exported during 2003.

Top

 

SpiceJet pilots to fly Oman Air

Dubai, June 21
Oman Air has entered into a strategic tie-up with SpiceJet under which pilots of the Indian carrier would fly planes of the former.

“Representatives of Oman Air were recently in India looking for a partner, who can provide us with well trained quality Boeing 737 pilots,” the gulf airline’s senior manager (line operations) Captain Hamed Al Jabry said in a press release.

Following a brief visit to India and meeting with SpiceJet chairman and CEO Siddhanta Sharma, and executive vice-president (flight operations) Captain Dhillon Jati, Oman Air found it ideal to provide qualified partners, he said.

“Our pilots will fly with Oman Air on a contract basis for a period of one year,” Jati added. — PTI

Top

 

Essar concludes Algoma takeover

New Delhi, June 21
Essar Global today said it has completed the acquisition of Canadian steel maker Algoma Steel Inc for over Rs 7,071.33 crore, that will bring new dimension to its marketing operations in North America.

“We are delighted to welcome Algoma to the Essar family,” Essar Global chairman Shashi Ruia said.

The acquisition was carried through Essar Global’s wholly owned subsidiary, Essar Steel Holdings Limited.

Denis Turcotte would continue as chief executive officer of Algoma Steel Inc.

Pursuant to the acquisition, the enlarged business would concentrate on further reducing costs of production, widening product range and developing new applications. — PTI

Top

 
BRIEFLY

Mobile radio
Mumbai, June 21
Reliance Communications today launched mobile radio service on its phones. The service would be available to both post-paid and pre-paid subscribers of Reliance Mobile, Reliance Hello and post-paid Reliance land line subscribers, a company release said here. The service would be available in eight Indian languages including Tamil, Gujarati, Kannada, Hindi and Malayalam. — PTI

Tata Motors
Mumbai, June 21
Tata Motors today said it has raised $450 million through issue of securities in the international market to meet product development expenditure and fund other corporate projects. The company has priced its $450 million issue of foreign currency Convertible Alternative Reference Securities, launched on June 21, at an initial conversion price of Rs 960.96 per share. — PTI

MoneyGram pact
Hyderabad, June 21
State Bank of Hyderabad and UAE Exchange and Financial Services agents for MoneyGram today signed an alliance for money transfer services. US-based MoneyGram International Inc will use the SBH network for distribution of money remitted from abroad by its clients. The services would be launched from July 16. — PTI

RBI holiday
New Delhi, June 21
The Reserve Bank of India (RBI) today said its offices will remain closed on July 2 for public transactions on account of annual closing of bank’s accounts. However, the offices would open on preceding Saturday — June 30 — for public transactions, RBI said. — PTI

Top

 





HOME PAGE | Punjab | Haryana | Jammu & Kashmir | Himachal Pradesh | Regional Briefs | Nation | Opinions |
| Business | Sports | World | Mailbag | Chandigarh | Ludhiana | Delhi |
| Calendar | Weather | Archive | Subscribe | Suggestion | E-mail |