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THE TRIBUNE SPECIALS
50 YEARS OF INDEPENDENCE

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B U S I N E S S

WB okays $600-m loan for co-operative banks
New Delhi, June 27
In one of the largest support packages to India, the World Bank today approved a $600 million (Rs 2,400 crore) loan toward revitalising rural Credit Cooperative Banks (CCBs) to transform access to financial services for India’s poorest farmers.

Rs 10 lakh cr needed for power sector: Shinde

New Delhi, June 27
The country would require additional investment of Rs 10 lakh crore during the 11th Plan for the expansion of the power generating capacity by 78,000 MW.

Union power minister Sushil Kumar Shinde (left) addresses a meeting while Dr Amit Mitra, secretary-general, Ficci, looks on in New Delhi on Wednesday.
Union power minister Sushil Kumar Shinde (left) addresses a meeting while Dr Amit Mitra, secretary-general, Ficci, looks on in New Delhi on Wednesday. — Tribune photo by  Manas Ranjan

Govt draws major plan to develop new airports
New Delhi, June 27
A major plan has been drawn up by the civil aviation ministry to boost air traffic under which the Airports Authority of India (AAI), in collaboration with private airport developers, would jointly pool in Rs 36,000 crore to develop half a dozen greenfield and 50 smaller airports, including four in the north-eastern states, a top official of the ministry said here today.

 

 

EARLIER STORIES

 

Indian emerges leader

Skoda to launch Fabia by year-end
Ahmedabad, June 27
Czech auto giant Skoda will roll out its first compact car, Fabia, in the country by the end of this year.

SABMiller to pump in Rs 500 cr
New Delhi, June 27
Looking to cash in on the burgeoning beer consumption in India, the UK-based SABMiller will invest around Rs 500 crore to expand production capacities at its breweries in the country.

HPMC pact to benefit apple growers
Shimla, June 27
The Himachal Pradesh Horticultural Produce Marketing and Processing Corporation (HPMC) has tied up with M/s Fresh and Healthy, a subsidiary of the Container Corporation of India, for marketing 12,000 tonnes of apple to ensure remunerative returns to growers.

Tea Board to promote India as global tea hub
Guwahati, June 27
The Indian tea industry is eyeing to recapture its shrinking traditional markets in Pakistan and the United Kingdom besides toppling Dubai from the status of an emerging international tea hub.

Form ‘stress test’ policies, banks told
Mumbai, June 27
With an aim to strengthen the banking sector, the Reserve Bank of India has asked the banks to formulate 'stress tests' as part of the risk management exercise to guard against possible danger to their solvency.

Proposal to make Punjab industrial region: Minister
Pathankot, June 27
To avoid fiscal disadvantages of industrial packages, sanctioned by the central government to certain neighbouring states, Punjab would soon be declared a manufacturing industrial region (MIR), said union minster of state for industries Ashwani Kumar here last evening.

President of Toyota Motor Corporation Katsuaki Watanabe introduces redesigned minivan Voxy and Noah, in Tokyo on Wednesday. Toyota started selling the minivans with 2-litre engine on the domestic market.
President of Toyota Motor Corporation Katsuaki Watanabe introduces redesigned minivan Voxy and Noah, in Tokyo on Wednesday. Toyota started selling the minivans with 2-litre engine on the domestic market. — AFP

Gas at $4.33 to save fertiliser subsidy: RIL
New Delhi, June 27
Reliance Industries has proposed a price of $4.33 per million British thermal unit (mBtu) for its gas from KG-D6 block, a rate which the company says will give power generation cost of Rs 2.50 a unit and help save Rs 6,900 crore in fertiliser subsidy annually.

Sops for small-scale industry
Kolkata, June 27
The West Bengal government today declared incentive package for small scale and micro industries.

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WB okays $600-m loan for co-operative banks
Tribune News Service

New Delhi, June 27
In one of the largest support packages to India, the World Bank today approved a $600 million (Rs 2,400 crore) loan toward revitalising rural Credit Cooperative Banks (CCBs) to transform access to financial services for India’s poorest farmers.

“The goal is to transform them into efficient and commercially viable institutions responsive to the financial service needs of India’s poorer farmers, including small and marginal farmers,” the World Bank said in a statement here.

"Better access to finance for India's rural poor is absolutely critical for higher rural growth, for reducing inequality, and ultimately, alleviating poverty," said Isabel Guerrero, World Bank country director for India.

"By providing small farmers with improved financial services, such as credit, savings, remittances and insurance, this project will play a significant role in helping India's rural poor benefit from growth opportunities."

Haryana is among the 12 Indian states which has signed up to the reform program. Potentially viable CCBs in those states will commit to a set of far-reaching legal, regulatory, governance and institutional reforms which will open the way to financial and operational restructuring.

In the process, the CCBs will be recapitalised with grants to wipe out the accumulated losses, the value of members' capital will be restored, and a minimum capital to risk weighted assets ratio (CRAR) of 7 per cent will be achieved.

The project will also provide technical assistance throughout the process to strengthen CCB governance, managerial and operational performance, and support the computerisation for enhanced efficiency and transparency. CCB members, particularly small and marginal farmers, will receive training in areas such as financial literacy and a strong project focus on monitoring and evaluation systems, will include monitoring by CCB members themselves.

"The project will transform India's rural credit co-operative banks into efficient and commercially viable institutions that can provide financial services to the poorest farmers at affordable terms," said Priya Basu, World Bank lead economist and project team leader.

The 12 states which have signed the memoranda of understanding with the Government of India and Nabard include Andhra Pradesh, Arunachal Pradesh, Bihar, Gujarat, Haryana, Madhya Pradesh, Maharashtra, Orissa, Rajasthan, Uttar Pradesh, Uttarakhand and West Bengal.

The loan from the International Bank for Reconstruction and Development (IBRD) has 20 years maturity, including a five-year grace period.

The credit is provided by the International Development Association (IDA), the World Bank's concessionary lending arm, and has 35 years to maturity and a 10-year grace period.

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Rs 10 lakh cr needed for power sector: Shinde
Tribune News Service

New Delhi, June 27
The country would require additional investment of Rs 10 lakh crore during the 11th Plan for the expansion of the power generating capacity by 78,000 MW.

“The challenge is not only to generate Rs 10 lakh crore in the 11th Plan, but also to find the institutions, companies, project managers, workmen and the vendors who will deliver the phenomenal work on generating capacity addition and the transmission and distribution network improvement and expansion in the required time frame,” said union power minister Sushil Kumar Shinde.

He said the Central power utilities such as BHEL do not have the requisite capacity to manufacture equipment of the size and magnitude required.

Shinde said “The shortage of power equipment (like turbines and boilers) to meet the requirements of generating companies is worrisome and the government would want production facilities to come up urgently in the joint sector.”

The power ministry had earlier partially blamed the state-run equipment supplier for failure to achieve 10th plan target. The country could add only about 22,000 MW of generation capacity during 2002-07 as against a target of 41,000 MW.

Ministry of Heavy Industries and BHEL, on the other hand, have in the past dismissed such statements, saying the company could not be blamed. BHEL has also said it has embarked on a Rs 3,200-crore expansion plan to enhance its capacity from the present 7,000 MW to 15,000 MW by 2010.

Addressing delegates to the ‘India Electricity 2007’, Shinde said the international conference and exhibition on emerging opportunities for investment and growth was a welcome initiative, which will provide the forum in which policy makers, investors, utilities and equipment suppliers will be able to interact with each other, understand one another’s requirements and see for themselves the opportunities that lie before them.

He said the key challenge for the power ministry was to help sustain the GDP growth of 9.4 per cent achieved in 2006-07 with a similar growth in the power sector.

He said it was imperative to ensure hat the current high levels of aggregate technical and commercial losses come down to 15 per cent in the next five years, so that the country can derive full benefits of the stupendous capacity addition efforts. Improving distribution would involve a lot more investment than in the past, coupled with a lot of technology inputs on a massive scale, he said.

Shinde said the power ministry would soon approach the union cabinet with a draft policy on hydroelectric projects. The policy aims at promoting hydel projects, encouraging private investment and address environmental concerns.

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Govt draws major plan to develop new airports
Tribune News Service

New Delhi, June 27
A major plan has been drawn up by the civil aviation ministry to boost air traffic under which the Airports Authority of India (AAI), in collaboration with private airport developers, would jointly pool in Rs 36,000 crore to develop half a dozen greenfield and 50 smaller airports, including four in the north-eastern states, a top official of the ministry said here today.

As part of the plan, the ministry will also make 12 airports operational that are not being used currently in the North-East and efforts will be made to step up investment for maintenance of airports at the national level, joint secretary in-charge of airport development K.N. Srivastava said.

Inaugurating Assocham-Ernst and Young organised summit on ‘Aviation industry issues’, Srivastava also disclosed that the ministry was in conclusive talks with Air Force authorities to allow the former to use some of Air Force stations for taking off civilian aircraft at certain peak hours.

Unfolding airport authority’s development programmes for greenfield and smaller airports, the joint secretary said Rs 12,000 crore investment would come from internal accruals and other sources of the AAI, while the civil aviation ministry expects Rs 24,000 crore from private developers.

He said about 127 airports, big and small, are operational under jurisdiction of the AAI and many of them need renovation.

Indian emerges leader

Policies and schemes put in place by the public sector airline Indian (airlines) has reaped rich rewards for it and paved the way for it wresting the number one position in domestic passenger carriage for the first time in over five years.

After the arrival of private and low cost carriers over the past few years, Indian had lagged behind and lost its majority market share. However, last month it recorded a passenger market share of 21.4 per cent. It also recorded the maximum monthly carriage of over one million passengers during the month.

While the airline has been the market leader in terms of Revenue Passenger Kilometres (RPK) recorded in March and April, May has seen the airline achieve the unique double - in both RPK and passenger carriage terms. The airline continues to be number one in RPK for the third month in succession, achieving 21.7 per cent market share in May.

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Skoda to launch Fabia by year-end

Ahmedabad, June 27
Czech auto giant Skoda will roll out its first compact car, Fabia, in the country by the end of this year.

“We are planning to launch the car by the end of this year. Fabia is very well accepted globally and with our experience in the car business, we are confident of receiving a similar response from the Indian customers as well,” Skoda India managing director (commercial) Karsten Bogun said here.

Although Bogun did not reveal the price of the much-awaited car, Fabia is likely to come with a premium tag and would be placed above Maruti Swift and Hyundai Getz that cost between Rs 4-5 lakh.

In the last five years, Skoda India has sold over 43,000 units, including luxury sedan Octavia. This year the company has set a sales target of 17,000 units. The company has a plant in Aurangabad district of Maharashtra.

Bogun was talking to reporters here after the opening of the company’s new dealership in Vadodara and Ahmedabad.

He said the company plans to expand its dealer network to 58 across the country by end of this year. — PTI

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SABMiller to pump in Rs 500 cr

New Delhi, June 27
Looking to cash in on the burgeoning beer consumption in India, the UK-based SABMiller will invest around Rs 500 crore to expand production capacities at its breweries in the country.

“SABMiller has earmarked an investment of Rs 100 crore every year for the next five years to expand capacity,” SABMiller director (corporate affairs) Sandeep Kumar said.

He said under the expansion programme, production capacities of the company’s breweries in Haryana and Andhra Pradesh would be increased, for which it has sought permission from the state governments.

SABMiller has 10 production facilities in India with production capacity of around 42 million cases per annum. The company plans to increase the capacity by eight million cases by the end of this year, Kumar informed. — PTI

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HPMC pact to benefit apple growers
Tribune News Service

Shimla, June 27
The Himachal Pradesh Horticultural Produce Marketing and Processing Corporation (HPMC) has tied up with M/s Fresh and Healthy, a subsidiary of the Container Corporation of India, for marketing 12,000 tonnes of apple to ensure remunerative returns to growers. It has also made arrangements for the procurement of 30,000 boxes of apple on outright purchase basis directly from the growers for sale through its own network and supply of 20 lakh cartons along with trays to growers.

HPMC has drawn up a comprehensive plan for apple season during which it proposes to procure 10,000 to 15,000 tonne of fruit to produce 500 tonne of apple juice concentrate. It has advised the growers to send fruit keeping in view the demand and avoid glut in the market. The corporation has assured that storage facilities would be provided for the purpose, both at producing area and terminal markets. It is upgrading and renovating cold storages at Delhi, Mumbai and Chennai, which are in dilapidated condition.

With an objective of bringing buyers to producing areas and eliminate middlemen, HPMC has decided to conduct auctions of fruit at its grading house in Jarol (Tikker) on an experimental basis from this season.

The corporation has set up control rooms at Shimla, Rampur, Rohru, Kulu and Kangra for the convenience of farmers.

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Tea Board to promote India as global tea hub
Bijay Sankar Bora
Tribune News Service

Guwahati, June 27
The Indian tea industry is eyeing to recapture its shrinking traditional markets in Pakistan and the United Kingdom besides toppling Dubai from the status of an emerging international tea hub.

Chairman of the Tea Board Basudeb Banerjee informed that the industry would leave no stone unturned to impress the large Pakistani and UK delegations coming to the India International Tea Festival (IITF), to be held here during November 22 to 24 this year.

Tea produced in Kenya and Sri Lanka have made deep inroad into traditional markets of Indian tea in these two countries because of competitive price tags on Kenyan and Sri Lankan brands.

There will be about 300 delegations of tea buyers from other countries like Russia, Egypt, Iran, UAE and of course from Gujarat, the largest tea consuming state in the country.

The IITF is being held jointly by the Tea Board of India, Indian Tea Associations and Indian Trade Promotion Organisation with the basic objective to increase exposure of Indian tea to global buyers. The organisers are in the process of finalising a brand name for the festival.

One of the focus areas of the festival will be to promote export of organic tea produced in Assam and Darjeeling in North Bengal. The Tea Board is trying to clear legal hurdles to have a Geographical Index (GI) for organic tea produced in Assam for the purpose of marketing.

Another objective of the IITF is to promote India, the only country in the world where all varieties of tea are produced, as global tea hub, a position it has lost out to Dubai.

“We are inviting experts from international tea companies to the IITF for the purpose of promoting India as the global tea hub,” union minister of state for commerce Jairam Ramesh said.

In a bid to promote Indian tea before buyers from the USA, where Indian tea’s share is about 8 million kg out of 90 million kgs consumed annually, the Tea Board has invited Oscar winning Julie Christie, one of the Hollywood’s most decorated actresses. The actress was born in a tea garden at Chabua in upper Assam where her father was a planter during the British raj.

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Form ‘stress test’ policies, banks told

Mumbai, June 27
With an aim to strengthen the banking sector, the Reserve Bank of India has asked the banks to formulate 'stress tests' as part of the risk management exercise to guard against possible danger to their solvency.

"Banks shall put in place appropriate stress test policies and the relevant stress test framework for the various risk factors by September 30," the RBI said in a communication to heads of commercial banks yesterday.

The formal stress-testing mechanism will come into operation from March 31, 2008, it added.

The stress tests to be designed by each bank will help them in taking remedial action against possible risks like sudden economic downturn, interest rate fluctuation, foreign exchange rates, collapse of communication system, natural disasters, stock market crash, depletion of country's foreign exchange reserves etc.

The remedial actions that banks may undertake pursuant to findings of the stress tests, include reduction of risk limits, enhancing collateral requirements, amendments to pricing policies, augmenting capital and increasing sources of funding.

The banks, as per the central bank guidelines, will be required to conduct stress tests for volatile risks on daily or weekly basis, for less volatile risks on monthly or quarterly basis, and ad hoc tests for extraordinary risks like rapidly deteriorating political and economic conditions. — PTI

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Proposal to make Punjab industrial region: Minister
Bipin Bhardwaj
Tribune News Service

Pathankot, June 27
To avoid fiscal disadvantages of industrial packages, sanctioned by the central government to certain neighbouring states, Punjab would soon be declared a manufacturing industrial region (MIR), said union minster of state for industries Ashwani Kumar here last evening. A proposal in this regard has already been submitted to the central government.

By declaring the state as MIR, the industrial growth in the state would not only be at par with the neighbouring states like Himachal Pradesh, Jammu and Kashmir and Uttaranchal, but the small and medium industries will also get a big boost, he claimed.

While talking to The Tribune, he said a delegation of Members of Parliament from Punjab had taken up the issue seeking special package for industry in the state with Prime Minister Manmohan Singh.

The minister also claimed to have taken up an issue with union food and supply minister for setting up a food-processing unit in Pathankot. A sum of Rs 50 crore would be released soon for the purpose after getting approval from the ministry. The Planning Commission has also sanctioned a sum of Rs 80 crore for the industrial development of Batala, he claimed.

An investment of Rs 130 crore in the district would improve the economy of the state, besides providing job avenues to the local residents.

Former MLA Pathankot, Ashok Kumar Sharma, district president of the Congress Committee Kishan Chand, former chairman of Pathankot Improvement Trust Rajbir Singh and president of local municipal council Shrawan Kumar were also present on the occasion.

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Gas at $4.33 to save fertiliser subsidy: RIL

New Delhi, June 27
Reliance Industries has proposed a price of $4.33 per million British thermal unit (mBtu) for its gas from KG-D6 block, a rate which the company says will give power generation cost of Rs 2.50 a unit and help save Rs 6,900 crore in fertiliser subsidy annually.

"We followed a very transparent process wherein bids were invited from private and public sector power and fertiliser units falling on our gas pipeline route. Not a single unit with large demand was left out," a top RIL official said.

Based on the bids, the maximum price of gas (at an exchange rate of one dollar to Rs 45) came to $4.33 per mBtu. This is lower than the average price of $4.57 per mBtu being charged for 20.4 million standard cubic metres per day of gas sold by other private firms' operated fields.

"We deliberately did not invite bids from major consumers like ceramic industry and oil refineries as they would have bid $7 per mBtu to save on the $15 per mBtu price paid for industrial LPG and $11 per mBtu for fuel oil, respectively," he said.

The delivered cost of gas after including taxes and transportation cost would be between $5.2 to $6.18 per mBtu depending on location. At the maximum, the cost of power generation would be less than Rs 2.50 per unit. — PTI

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Sops for small-scale industry

Kolkata, June 27
The West Bengal government today declared incentive package for small scale and micro industries.

Announcing the package, Chief Minister Buddhadeb Bhattacharjee said special attention should be given to small and micro industry to expedite the growth of this sector.

The 2007 incentive package would offer 7.5 to 10 per cent capital investment subsidy, 25 per cent interest subsidy and 30 per cent reimbursement of electricity charges for five years.

He said the package would also give 50 per cent refund of stamp duty and registration charges. — UNI

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BRIEFLY

Tata Power
Mumbai, June 27
Tata Power today said it has completed acquisition of 30 per cent stakes in Indonesian thermal coal producers — PT Kaltim Prima Coal (KPC), PT Arutmin Indonesia and other related coal trading companies owned by PT Bumi Resources Tbk. The definitive agreements to purchase the equity stakes were signed on March 30 by the company for a consideration of $1.1 billion prior to working capital and other adjustments. — PTI

Bata stores
Kolkata, June 27
Bata India Ltd today said it would open 200 new stores across the country in two to three years to take on the growing competition. Company chairman Bata P M Sinha said Bata would set up these stores in malls which would have contemporary designs prevalent in countries like Singapore, Malaysia and Italy. The target would be tier I and tier II cities, he informed. — PTI

Sonata variant
New Delhi, June 27
Hyundai Motor India Ltd (HMIL) today launched a new automatic variant of its diesel powered luxury sedan Sonata Embera CRDi, priced at Rs 15,71,656 (ex-showroom Delhi). The company had launched a diesel varient of Sonata Embera with manual transmission earlier this year. — PTI

Godrej outlets
Ahmedabad, June 27
Godrej Group today said it would double the number of its ‘Lifespace’ retail stores to 100 by 2010 for increased presence in the country. “At present we are having 50 stores across the country and in this year alone we are planning to set up 20 more stores,” said Shyam Motwani, vice-president and business head, Godrej Lifespace, a retailing division of Godrej and Boyce Mfg Company. — PTI

Spice IPO
Mumbai, June 27
Initial public offer of mobile service provider Spice Communications got subscribed over 30 times on its last day of offer. The IPO received 346.94 crore bids for its offer of 11.3 crore equity shares, latest data available on the stock exchanges show. — PTI

Coca-Cola order
Chennai, June 27
Jain Irrigation has bagged an Rs 84 crore order from Hindustan Coca-Cola Company for supply of mango pulp for popular brand ‘Maaza’. This order has seen a quantum jump compared to the order of Rs 33 crore last year, a company said. — UNI

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