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B U S I N E S S

MPs’ panel for freeze on new SEZs
New Delhi, July 6
The Parliamentary Standing Committee on Commerce has called for freeze on notification of further special economic zones (SEZs) till the SEZ Act and rules are amended to meet the public concerns relating to land acquisition.

TN inks pact for Rs 1,500-cr zone
Chennai, July 6
The Tamil Nadu government today signed a memorandum of understanding (MoU) with Hyderabad-based GVK Group to set up a Rs 1,500-crore multi-products special economic zone (SEZ) in 3,000 acres in Perambalur district.

MRPL to export fuel worth $2 b to Mauritius
New Delhi, July 6
Fuel worth $2 billion (about Rs 8,000 crore) would be exported to State Trading Corp (STC) of Mauritius for a three-year period by Mangalore Refinery and Petrochemicals Ltd (MRPL), a subsidiary of state-run oil major ONGC.

Time to counter Re surge: Exporters
New Delhi, July 6
Worried over the possible irreparable impact of hardening of rupee on Indian exports, the Federation of Indian Export Organisations (FIEO) has made frantic appeal to the government to expeditiously implement the measures announced by it last month to offset the adverse impact.

Mutual funds outperform Sensex
Mumbai, July 6
Marketmen may be jubilant about the Sensex touching the 15,000-point milestone, but mutual fund investors are laughing all the way to the bank thanks to many funds outperforming the key index in the last 12 months.



 

EARLIER STORIES

 
Bollywood actress Neha Dhupia holds a diamond-studded ball at a fashion show organised by Gitanjali jewellery house in New Delhi on Thursday night. Two diamond-studded balls, designed by Gitanjali, will be presented to the men's and women's singles champion of the ongoing Wimbledon tennis tournament in England.
Bollywood actress Neha Dhupia holds a diamond-studded ball at a fashion show organised by Gitanjali jewellery house in New Delhi on Thursday night. Two diamond-studded balls, designed by Gitanjali, will be presented to the men's and women's singles champion of the ongoing Wimbledon tennis tournament in England. —Tribune photo by Mukesh Aggarwal

Wipro buys Unza for $246 m
Bangalore, July 6
Azim Premji-led IT and FMCG company Wipro Ltd today announced acquiring Singapore-based personal care firm Unza Holdings Ltd for $246 million (1,010.2 crore) in an all-cash deal. Unza, which recorded revenues of Rs 683.3 crore in the last financial year, has 48 brands like Enchanteur, Safi, Romano, Izzi, Vigor and Maxkleen, senior officials of the two companies told a news conference here today.

Vietnam wants market economy status from India
New Delhi, July 6
Vietnam has requested India to grant market economy status under the WTO mechanism and stated that its economy is well qualified for the same. Nguyen Danh Vinh, deputy trade minister of Vietnam, communicated the request during his meeting with minister of state for industry Ashwani Kumar here today.

Mumbai aims at Rs 88,000-cr IT revenue
Mumbai, July 6
The finance ministry has asked the Central Board of Direct Taxes (CBDT) to squeeze more money out of Mumbai by way of higher income tax. The target set for the Income Tax Department during the current financial year is Rs 88,400 crore though it could easily be revised upwards if the first and second quarter corporate results leave a bigger blip of green in companies' account books.
A Sanrio employee displays a doghouse, designed with a Hello Kitty and decorated with 7,600 Swarovski crystals, in Tokyo on Friday. Sanrio will sell one and only one model on July 24 at a Hello Kitty event in Tokyo
A Sanrio employee displays a doghouse, designed with a Hello Kitty and decorated with 7,600 Swarovski crystals, in Tokyo on Friday. Sanrio will sell one and only one model on July 24 at a Hello Kitty event in Tokyo. — AFP photo

Service tax to add over Rs 50,000 cr in govt kitty
New Delhi, July 6
The service tax collection during 2007-08 is expected to cross Rs 50,000 crore mark as against Rs 37,500 crore in the previous fiscal, Central Board of Excise and Customs member P Jha said here today. Speaking at a PHDCCI organised interaction on service tax, Jha said this would be despite over two lakh tax-payers have been exempt from paying service tax following rise in the ceiling to Rs 8 lakh from earlier Rs 4 lakh.

Gold plunges by Rs 85
New Delhi, July 6
Gold tumbled on the bullion market today on sluggish demand amidst fresh offerings by stockists on the back of weakening global trend and closed with hefty loss of Rs 85 at Rs 8,665 per ten gram. 

Oriental Insurance net up 75 pc
New Delhi, July 6
Oriental Insurance Company Ltd has recorded a 75.15 per cent increase in net profit to Rs 497.27 crore for 2006-07 as against Rs 283.91 crore in the previous fiscal. The company has declared a dividend of 100 per cent for 2006-07 as against 50 per cent previous fiscal

 

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MPs’ panel for freeze on new SEZs
Tribune News Service

New Delhi, July 6
The Parliamentary Standing Committee on Commerce has called for freeze on notification of further special economic zones (SEZs) till the SEZ Act and rules are amended to meet the public concerns relating to land acquisition.

The committee, headed by BJP leader and former union minister Murli Manohar Joshi, in its report on ‘the functioning of SEZs’, recommended reducing the maximum land area for multi-product SEZs to 2,000 hectares if cultivable land is acquired for setting up these zones.

An Empowered Group of Ministers, headed by union minister Pranab Mukherjee, had earlier fixed 5,000 hectares as the land ceiling for multi-product SEZs.

Asserting that the government should take a fresh look at the policy as a whole and re-frame it in such a manner that would make it people-friendly, besides achieving the objective of export-led industrial growth, the panel has recommended that all land for SEZs should be taken on lease by developers.

“There should not be transfer of ownership and SEZs should not be allowed to come up at the cost of farmers,” the panel said adding there should preferably be a ban on the use of irrigated double-crop or multi-crop land for setting up SEZs. “Only waste and barren lands should be used for setting up SEZs,” it said.

The panel has also said that the Board of Approval (BoA) should not entertain any application directly from a developer and the system of giving “in-principle” approvals should be discontinued. Besides, it has recommended that the ministry of agriculture must be represented on the Board of Approval.

On the compensation front, the panel has recommended that the monetary compensation for acquisition of land should be only a part of the compensation package and should be calculated on the basis of the prevailing market rates.

“To ensure this, the state governments should prescribe minimum prices for land in various areas, which should reflect the market rate, and review/revise these prices periodically,” it said asserting that thereupon, whether the land is acquired by the government or the SEZ developer, the acquisition/purchase price should be higher than the minimum price fixed by the government.

Besidesmonetary compensation, at least one family member of the land-owner should be offered a suitable employment in the SEZ venture.

The feasibility of allotting equity shares to the land-owners in the developer’s company should also be considered, it added.

The report of the panel was released to the media on the day the centre anticipated an investment worth Rs 100,000 crore to flow in the 128 notified SEZs by December and export proceeds from operational SEZs likely to reach Rs 67,000 crore by end of current fiscal.

Inaugurating Assocham-organised conference on SEZ Policy, joint secretary in charge of SEZs in the ministry of commerce and industry Anil Mukim said in the next five years, the total investment amount that is expected to come in the SEZs would be about Rs 300,000 crore, which would have FDI’s element of nearly $60 billion.

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TN inks pact for Rs 1,500-cr zone

Chennai, July 6
The Tamil Nadu government today signed a memorandum of understanding (MoU) with Hyderabad-based GVK Group to set up a Rs 1,500-crore multi-products special economic zone (SEZ) in 3,000 acres in Perambalur district.

The MoU, to jointly develop the SEZ, was signed by Tamil Nadu Industrial Development Corporation (TIDCO) chairman S Ramasundaram and GVK Power and Infrastructure Limited chairman G V Krishna Reddy in the presence of Chief Minister M Karunanidhi.

An official press release here said the project would be completed in 2009 and would attract investments worth Rs 5,000 crore within 10 years. The project would generate employment for 50,000 persons, it said.

The SEZ would cater to industries like textile garments, leather, engineering goods, pharmaceuticals, power, IT, iron and steel, fertilisers, chemicals, petrochemicals etc. — PTI 

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MRPL to export fuel worth $2 b to Mauritius
Tribune News Service

New Delhi, July 6
Fuel worth $2 billion (about Rs 8,000 crore) would be exported to State Trading Corp (STC) of Mauritius for a three-year period by Mangalore Refinery and Petrochemicals Ltd (MRPL), a subsidiary of state-run oil major ONGC.

The contract was signed here today in the presence of union minister of petroleum and natural gas Murli Deora and the Mauritian minister of industry, SME, commerce and cooperatives Rajesh Jeetah.

The contract provides for supplying one million tonne petroleum products a year for a period of three years to meet all the petroleum requirements of Mauritius.

Speaking on the occasion, Deora said the agreement is a very important step forward in strengthening the friendly relations between India and Mauritius.

He added that the contract will provide long term assurance and comfort to Mauritius on continued availability of strategic and sensitive petroleum products.

The visiting Mauritius minister said the strong cultural and emotional bonds between India and Mauritius is taking a new turn with rapidly growing economic and technical ties.

In June last year, MRPL had entered a term deal with STC for export of petrol, diesel, ATF and fuel oil. The one-year contract expires this month and would be replaced by a three-year contract, from August, 2007 to July, 2010.

MRPL will export 90,000 tons of petrol, 350,000 tons of diesel, 260,000 tons of aviation turbine fuel and about 300,000 tons of fuel oil per annum.

ONGC chairman and managing director R S Sharma said MRPL was looking at using Mauritius as base for exporting fuel into Africa.

MRPL is expanding its capacity to 15 million tons a year at an investment of Rs 8,000 crore and most of the products would be exported.

Jeetah said his country was talking to MRPL about building facilities to store up to 20,000 tonnes of oil products. He also said talks were being held about ONGC gaining exploration rights in Mauritius.

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Time to counter Re surge: Exporters
Tribune News Service

New Delhi, July 6
Worried over the possible irreparable impact of hardening of rupee on Indian exports, the Federation of Indian Export Organisations (FIEO) has made frantic appeal to the government to expeditiously implement the measures announced by it last month to offset the adverse impact.

Pointing that the hardening of rupee is eroding the competitiveness and profitability of exporters who are losing the edge to China, Thailand, Pakistan, Sri Lanka and Bangladesh, FIEO president Ganesh Kumar Gupta said the announcement made by commerce minister Kamal Nath last month should be implemented in the right earnest to ensure that the market of the Indian exporter is not lost to these competitors forever.

Expressing concern over the strengthening of rupee to the level of 40.35 against a dollar, Gupta said though the hardening of Indian currency has affected all exporters, the lifestyle segment exporters are the worst affected as they were to finalise their contracts by July/August for the coming festive season abroad.

While detailing the sectoral impact, the FIEO chief said the textiles and apparel export industry have witnessed a decline of 8 to 10 per cent in their net profit margins which would force them to cut down costs by cutting employment and capacity building, affecting the sector adversely in the long term.

Leather goods sector and handicrafts were also substantially affected, he said, adding latest official data showed that exports from these sectors slowed down to 18.07 per cent in May from 23.06 per cent in April.

On June 13, the commerce minister had given a wide-ranging assurance to the exporters, including enhancement of Duty Entitlement Pass Book (DEPB) and Duty Drawback Rates (DDR) by 5 per cent, to counter the negative impact of rupee appreciation on India’s exports.

Besides enhancement of DEPB and DDRs, Nath had assured the exporters that his ministry would recommend to the ministry of finance to reduce rate of interest on pre-shipment and post-shipment credit for exporters to 6 per cent as against the present interest rate which ranges between 9 per cent and 11 per cent and to make it mandatory for scheduled commercial banks to meet 15 per cent export credit disbursement target.

The minister had also said that the Exchange Earners’ Foreign Currency (EEFC) accounts may be made interest bearing (as on date, EEFC account deposited is stated as current account and interest on it discontinued since 2000) and notify the service tax exemption/refunds for exports announced in the Foreign Trade Policy 2007 without further delay.

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Mutual funds outperform Sensex

Mumbai, July 6
Marketmen may be jubilant about the Sensex touching the 15,000-point milestone, but mutual fund investors are laughing all the way to the bank thanks to many funds outperforming the key index in the last 12 months.

While the 30-share Sensex has grown about 40 per cent since July 2006, when it was quoting around 10,600 points, 106 funds have given higher returns than the bellwether.

Among the best performing equity funds are Standard Chartered Equity with 79 per cent returns over a year, JM Basic (76 per cent), ICICI Prudential Services (75), ICICI Infrastructure (63) and DBS Chola (61 per cent) according to data complied by ValueResearchOnline.

The assets under management (AUM) of the 32 fund houses in the country have grown 25 per cent to over Rs 400,000 crore in the first six months of the year, the latest data of Association of Mutual Funds in India (AMFI) shows.

“The new levels of the benchmark index show more demand for equities and is a sign of recognition for the strength and potential of Indian economy,” AMFI head A P Kurien said.

While a bullish market does not affect the mutual fund industry directly, Kurien said the funds “are pleased that it implies a strong growth potential for the markets.”

“Investors are happy with the milestone... some of the funds have performed better than the Sensex off-late as growth in the mid-cap has led the rise in blue chips,” ValueResearch CEO Dhirendra Kumar said.

Dismissing concerns of a correction after every milestone, Kumar said a slight correction should not bother MF investors as long as the funds remain in the black. — PTI 

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Wipro buys Unza for $246 m

Bangalore, July 6
Azim Premji-led IT and FMCG company Wipro Ltd today announced acquiring Singapore-based personal care firm Unza Holdings Ltd for $246 million (1,010.2 crore) in an all-cash deal.

Unza, which recorded revenues of Rs 683.3 crore in the last financial year, has 48 brands like Enchanteur, Safi, Romano, Izzi, Vigor and Maxkleen, senior officials of the two companies told a news conference here today.

Unza has a headcount of 4,000 and five manufacturing plants - two in Malaysia and one each in Vietnam, China and Indonesia, Wipro Consumer Care and Lighting’s president Vineet Agrawal said.

The deal would be funded through internal accruals and the transaction is expected to be closed by this month-end.

Revenues from the acquisition would start flowing in from the current quarter (July-September) itself, he said.

About 50 per cent of Unza’s business comes from Malaysia and the rest from markets such as Indonesia, Vietnam, China, Singapore and Nigeria. He said there would be no margin dilution following the buy-out because Wipro Consumer Care and Lighting business’ operating margin was 12.5 per cent, while that of Unza is 12 per cent.

The New York Stock Exchange-listed Wipro’s consumer care and lighting division clocked revenues of close to Rs 800 crore in 2006-07. — PTI

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Vietnam wants market economy status from India
Tribune News Service

New Delhi, July 6
Vietnam has requested India to grant market economy status under the WTO mechanism and stated that its economy is well qualified for the same.

Nguyen Danh Vinh, deputy trade minister of Vietnam, communicated the request during his meeting with minister of state for industry Ashwani Kumar here today.

However, Kumar informed the Vietnamese delegation that a decision on this issue would require a thorough examination and necessary deliberations at various levels.

Vinh also emphasised the need to speedily conclude the Indo-Asean Free Trade Agreement and made specific requests for greater market access on certain agricultural products of importance to Vietnam such as coffee, tea and pepper.

Kumar observed that the same products are also important to India, both in terms of economic value and employment, and any decision on the issue would require a win-win situation for both countries.

Kumar also agreed to the need for greater economic engagement between the two countries and highlighted energy sector as one particular area where Indian companies can invest in Vietnam. “Trade relations with Vietnam are very much a part of India’s look east policy”, he said.

The Vietnamese minister proposed setting up of a forum for trade and investment policy exchange, which could provide a platform for engagement of officers and businessmen from both countries to engage on trade and investment relations, in the area of investment promotion, tourism and trade facilitation.

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Mumbai aims at Rs 88,000-cr IT revenue
Tribune News Service

Mumbai, July 6
The finance ministry has asked the Central Board of Direct Taxes (CBDT) to squeeze more money out of Mumbai by way of higher income tax.

The target set for the Income Tax Department during the current financial year is Rs 88,400 crore though it could easily be revised upwards if the first and second quarter corporate results leave a bigger blip of green in companies' account books.

Last year, the Income Tax department had set a target of Rs 69,000 crore, but revised it upwards by Rs 10,000 crore later. However, the city of gold could not yield that much and the taxman fell Rs 4,000 crore short of the revised target.

The taxmen are burning the midnight oil poring over the account books of corporate houses and high net worth individuals in a bid to make them cough of more money by way of income tax.

Among those under watch would be high spenders who blow up crores on credit cards and art galleries which have been under the scanner for under declaring sales.

Mumbai is the biggest contributor to the central tax kitty with nearly 40 per cent of the collections coming from this city.

Attempts by activists and local politicians to get the central government to loosen the purse strings for improving Mumbai's infrastructure hasn't worked so far. 

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Service tax to add over Rs 50,000 cr in govt kitty
Tribune News Service

New Delhi, July 6
The service tax collection during 2007-08 is expected to cross Rs 50,000 crore mark as against Rs 37,500 crore in the previous fiscal, Central Board of Excise and Customs member P Jha said here today.

Speaking at a PHDCCI organised interaction on service tax, Jha said this would be despite over two lakh tax-payers have been exempt from paying service tax following rise in the ceiling to Rs 8 lakh from earlier Rs 4 lakh.

He, however, said there is a necessity to bring more services in the tax net in view of the introduction of goods and service tax by 2010 since at that point value added tax and central sales tax and service tax should converge.

Jha also diclosed that in the current fiscal, the government expected to collect over Rs 5.5 lakh crore through taxes, comprising of 2.8 lakh crore from the indirect tax basket and Rs 2.7 lakh crore from direct taxes.

The service tax would alone be contributing about nine per cent of the government’s total tax collection and about 18 per cent of indirect tax collection in the current fiscal, Jha added.

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Gold plunges by Rs 85

New Delhi, July 6
Gold tumbled on the bullion market today on sluggish demand amidst fresh offerings by stockists on the back of weakening global trend and closed with hefty loss of Rs 85 at Rs 8,665 per ten gram.

Silver also eased on reduced industrial offtake against fresh arrival.

Marketmen said lack of local demand due to off-marriage and festival season and fresh offerings by stockists triggered by weakening trend in global markets mainly pulled down gold prices.

A rise in US interest rates buoyed the dollar and reduced the metals appeal, they added. Standard gold and ornaments witnessed fresh selling pressure and dipped by Rs 85 each at Rs 8,665 and Rs 8,515 per ten grams respectively. Sovereign, followed suit and lost Rs 50 at Rs 7,550 per piece of eight gram. — PTI 

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Oriental Insurance net up 75 pc
Gives 100 pc dividend
Tribune News Service

New Delhi, July 6
Oriental Insurance Company Ltd has recorded a 75.15 per cent increase in net profit to Rs 497.27 crore for 2006-07 as against Rs 283.91 crore in the previous fiscal. The company has declared a dividend of 100 per cent for 2006-07 as against 50 per cent previous fiscal.

Addressing a press conference here today, the company’s CMD M Ramadoss said the jump is profits was due to flexibility in pricing of products allowed by the government since January this year, rise in business in certain sectors, cut in losses on motor insurance and reduction in expenses of management.

The gross premium collections rose from Rs 3,609 crore to Rs 4,020 crore during this period, he said.

Armed with surplus cash of about Rs 2,000 crore, the company plans to expand operations in the Middle-East countries. The company has already done business of around Rs 90 crore in overseas markets, including Dubai and Kuwait.

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BRIEFLY

Inflation up at 4.13 pc
New Delhi, July 6
After a 10-week long downward trend, inflation increased to 4.13 per cent for the week ended June 23 as against 4.03 per cent in the previous week due to rise in prices of food articles and some manufactured goods. The Wholesale Price Index was at 4.84 per cent in the corresponding week a year ago. — TNS

Verna dearer
New Delhi, July 6
Hyundai Motor India Ltd (HMIL) today said it has increased the price of the diesel variant of its sedan Verna by up to Rs 8,350. Under the new pricing, the base model of CRDi Verna will cost Rs 7,54,902, an increase of Rs 7,983. The top-end Verna SX ABS will be costlier by Rs 8,350 at Rs 8,26,910 (ex-showroom Delhi). — PTI

Rolta buyout
Mumbai, July 6
Rolta, a leader in providing knowledge-based comprehensive IT solutions, today announced that it has acquired Orion Technology Inc, a Canadian software and integration company specialising in enterprise web-GIS solutions. This acquisition enables Rolta to own exceptional technologies for taking its GIS offerings to the next level of sophistication. — UNI

Gold coins
Bangalore, July 6
Syndicate Bank today launched “SYNDSONA”, the brand under which it will sell gold coins through 104 select branches spread across eight states. The coins are available in denominations of four gms, eight gms and 10 gms in tamper-proof card with 999.9 purity certificates, it said in a statement. — PTI

Budweiser beer
Mumbai, July 6
US-based beer major, Budweiser, in association with Crown Beers India Ltd, today launched a range of beers in western and southern India. ''As the Indian market continues to experience tremendous growth, our goal is to position Budweiser as a leading brand in the premium and light beer category in India,'' CEO Stephen J Burrows said. Budweiser will be available in 330 ml and 650 ml bottles. — UNI

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