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B U S I N E S S

Sensex sets new records
Mumbai, October 9
A day after the bears went on the rampage, the bulls struck back with a vengeance taking the Sensex up 789 points to cross 18,000 mark and close at 18,280 levels. In the broader markets, Nifty surged 242 points or 4.7 per cent to close at 5,327 levels.

Banks’ Credit Off-take Slows Down
Govt to scale down targets

New Delhi, October 9
High interest rate and Reserve Bank's directions to banks for squeezing credit to certain sectors like real estate have forced the government to revise annual credit off-take targets.

Fin Min to wipe out revenue deficit 
New Delhi, October 9
The government today said it is on track to reducing fiscal deficit to 3 per cent and expressed hope of eliminating revenue deficit by financial year 2008-09.

Govt warns 52 SEZs
Complete formalities or lose nod
New Delhi, October 9
The Centre has issued ultimatum to promoters of 52 special economic zones to complete the formalities for notification of their SEZs, failing which their formal approval would be cancelled.





 

Govt to set up two funds on micro-finance
New Delhi, October 9
To facilitate availability of easy credit to the poor, the government has decided to set up two funds of Rs 500 crore each.

‘Empower rural enterprises’
New Delhi, October 9
External affairs minister Pranab Mukherjee today underlined the need for a rural revolution by creating and empowering rural enterprises, enabling them to climb up the value chain, and replicating rural entrepreneurial success stories throughout the country.

GSM operators oppose extra spectrum to BSNL
New Delhi, October 9
Private GSM Mobile operators have opposed the government's move to allot additional spectrum to state-run telecom company BSNL, saying it is a clear violation of the contractual and legal rights of the private operators.

BHEL wins Rs 394-cr RINL contract
New Delhi, October 9
Engineering major Bharat Heavy Electricals Limited (BHEL) has won a turnkey contract for setting up a captive power plant at a steel plant in Andhra Pradesh.

Assam inks 26 MoUs with Thai companies
Guwahati, October 9
Assam expects its first flush of foreign direct investment (FDI) worth $10 million soon in the food-processing sector from a Thai company as spin off from the just-held North- East Investment Opportunities Week in Bangkok under the aegis of union ministry of DONER.

Indian-AI merger row reaches SC
New Delhi, October 9
National Aviation Company of India Ltd, the new entity formed after the merger of Indian and Air India, today moved the Supreme Court seeking consolidation of the cases challenging the merger of the two state carriers.

10 pc GDP growth sustainable: OECD
New Delhi, October 9
India’s annual economic growth could reach a sustainable 10 per cent and be spread more evenly across the country if it pursues ambitious and wide-ranging reforms, according to Organisation for Economic Cooperation and Development (OECD).

RIL finds oil in Kaveri basin
New Delhi, October 9
Reliance Industries (RIL) has made a significant oil discovery in its offshore Kaveri basin block.

Reliance Life unveils ‘Express Life’
Chandigarh, October 9
Reliance Life Insurance today announced the launch of a new policy 'Express Life', which the company claimed is the first 'over-the-counter' policy in the country.

GAIL gas for Bawana plant
New Delhi, October 9
GAIL today signed a gas sales agreement with Pragati Power for the gas supply of two metric million standard cubic metres per day (MMSCMD) to Bawana Power Plant.

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Sensex sets new records
Tribune News Service & PTI

Mumbai, October 9
A day after the bears went on the rampage, the bulls struck back with a vengeance taking the Sensex up 789 points to cross 18,000 mark and close at 18,280 levels.

In the broader markets, Nifty surged 242 points or 4.7 per cent to close at 5,327 levels. Among the big gainers today were the oil refinery, real estate and information technology stocks that were buoyant on expectations of good second quarterly earnings.

Today’s big gainer was Reliance Energy, which surged 11.2 per cent to close at Rs 1,533. Reliance Communication, Maruti Suzuki, Reliance Industries, NTPC and State Bank of India were the other gainers closing over 6 per cent each.

The market set several new records, including the biggest single-day gain of 789 points at close, as well as the largest intra-day gains of 993 points in absolute term.

The Bombay Stock Exchange (BSE) benchmark Sensex also recorded the second fastest 1,000-point journey from 17K to 18K in nine trading sessions. The fastest 1,000-point journey was achieved in six sessions between 16K and 17K last month.

The news that the Left-UPA committee on the nuclear deal will meet on October 22 only indicated that the Congress-led UPA government at the centre and its communist allies have stepped back from Tuesday's political stalemate, sparking off a huge price rally across-the-board.

The bullish fervour was also attributed to strong expectations of better-than-projected quarterly earnings to be released by the companies later in the month.

The FII inflows have crossed $14.5 billion so far in the year, a new record, with a massive $5.0 billion in just 12 sessions from September 19 onwards.

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Banks’ Credit Off-take Slows Down
Govt to scale down targets

New Delhi, October 9
High interest rate and Reserve Bank's directions to banks for squeezing credit to certain sectors like real estate have forced the government to revise annual credit off-take targets.

" The government will take a realistic view on scaling down credit target of PSU banks for this fiscal if the banks feel that targets are not achievable," financial services secretary Vinod Rai told reporters on the sidelines of a conference here today.

The public sector banks had earlier projected a growth of 20-25 per cent in credit for 2007-08. Major state-owned banks, including SBI and Punjab National Bank (PNB), have already reported slow down in loans.

PNB has even asked the government to revise its business target downward by 7-9 per cent to 16-17 per cent in light of general slowdown in the credit off-take.

Rai said since the statements of intent were given by them (SBI and PNB) only, the government was ready to review if they believed that targets were unachievable. Admitting slow down of credit, he said it was very much in the realm of government's anticipation.

Nod to SBI to raise Rs 10,000 crore

The government has given a go-ahead to public sector lender SBI to raise Rs 10,000 crore from the market by March 2008, though it remains to be decided whether the funds would be raised through offering of shares to public or rights issue.

"The government has given an in-principal approval to State Bank of India for raising Rs 10,000 crore capital. However, the mode has still to be finalised," financial services secretary Vinod Rai told reporters on the sideline of a conference on micro-finance here today.

Rai said the capital raising would happen before the end of this financial year.

The government's stake would be diluted if the bank was allowed to raise capital through a follow on public offer of shares. However, the rights issue would allow the bank to raise Tier-I capital without diluting government shareholding, which currently stands at 59.73 per cent. Under the current provision, the government may dilute its stake to 55 per cent. — PTI

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Fin Min to wipe out revenue deficit 
Tribune News Service

New Delhi, October 9
The government today said it is on track to reducing fiscal deficit to 3 per cent and expressed hope of eliminating revenue deficit by financial year 2008-09.

“We are on track to reducing fiscal deficit to 3 per cent and hopeful of eliminating the revenue deficit by next fiscal,” union finance secretary Subba Rao said here after the release of Organisation for Economic Cooperation and Development’s (OECD) first Economic Survey of India 2007.

Dr Rao, who underlined the importance of economic efficiency to sustain the present level of GDP growth, if not 10 per cent growth, listed exchange rate, interest rate and inflation as the three major day-to-day challenges before the government.

In the medium term, he listed five challenges, which the government of the day has to overcome to unravel the potential and enhance economic growth in the country, which is inclusive.

“Stepping up agriculture growth, expansion of employment growth taking advantage of geographical dividend, ensuring investment in infrastructure, improving service delivery and managing globalisation are the five major challenges that need to be addressed to ensure growth,” the finance secretary said.

He said though agriculture’s share in GDP is just 18 per cent, a lot of focus is needed to bolster this sector as 60 per cent of population still depended on agriculture and the growth of other sectors depended on it.

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Govt warns 52 SEZs
Complete formalities or lose nod

New Delhi, October 9
The Centre has issued ultimatum to promoters of 52 special economic zones to complete the formalities for notification of their SEZs, failing which their formal approval would be cancelled.

Seven of these projects involve the Maharashtra Industrial Development Corporation, a commerce ministry official said.

"We have asked them to complete the notification formalities by October 25. Those who do not complete the formalities will lose their approvals and would have to apply again," he said.

He said the Board of Approval had cleared 234 SEZs till March this year and the promoters who have been served notices are from this lot.

Besides Maharashtra, Haryana has the maximum number of promoters who have not applied for notification of their zones after getting formal approvals.

The government has till September-end given formal approval to 386 SEZs, in-principle nod to 176 and notified 149 zones. The BoA had earlier decided to cancel 100-odd SEZ applications for which the state governments are yet to submit the status report. — PTI 

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Govt to set up two funds on micro-finance
Tribune News Service

New Delhi, October 9
To facilitate availability of easy credit to the poor, the government has decided to set up two funds of Rs 500 crore each.

“We have decided to set up two funds — Financial Inclusion Fund and Financial Inclusion Technology Fund of Rs 500 crore each,” finance minister P Chidambaram said at a conference on micro-finance.

He said the decision is based on the interim report of the Financial Inclusion Committee, chaired by Dr C Rangarajan, chairperson of the Economic Advisory Council to the Prime Minister.

A Rs 100-crore micro-finance development fund has already been set up by the centre.

Pointing that a Bill has been introduced to regulate non-profit making micro- finance institutions (MFIs) under regulation, the finance minister said the government will consider favourably any suggestions for also bringing profit-making MFIs under regulatory mechanism.

Highlighting the phenomenal contribution being made by self-help groups to achieve financial inclusion, Chidambaram said Palakkad in Kerala was the first district in the country to achieve cent per cent financial inclusion and since then many other districts have followed suit.

“I welcome a muti-pronged, diversified and multi-sourced approach to achieving financial inclusion,” he added.

The two-day conference, which is being attended by 600 experts from India and abroad, will deliberate and come out with recommendations on ‘Formal financial institutions and micro-finance — the challenges of depth and breadth.” 

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‘Empower rural enterprises’
Tribune News Service

New Delhi, October 9
External affairs minister Pranab Mukherjee today underlined the need for a rural revolution by creating and empowering rural enterprises, enabling them to climb up the value chain, and replicating rural entrepreneurial success stories throughout the country.

“The challenge that we face is how to create a revolution to upscale rural enterprises. We need to devise a framework that would enable rural enterprises to climb up the quality value chain. We also need to look at how we can create networks, both domestic and international, to market the genius of people, who reside in rural India,” Mukherjee said while delivering the valedictory address at the India Rural Business Summit here.

The fact that business worth Rs 2.5 crore has been generated by the rural entrepreneurs during the two-day summit by 42 rural exhibitors is a telling example of the innovation of the rural populace in producing world-class hand-made products, he said.

The summit was organised jointly by Ficci, the department of commerce and the ministry of rural development with the support of nine other ministries of the Central Government.

Earlier, minister of state for finance Pawan Kumar Bansal, while chairing the session on ‘Leveraging financial services to rural entrepreneurs’, pointed out that the government was committed to reaching cent per cent financial inclusion in the shortest possible time.

He said the government’s effort was to provide timely, adequate and hassle-free credit to the rural folk through the medium of correspondent banking. Additionally, Regional Rural Banks were being strengthened and up to now 196 RRBs had been consolidated to 96 in order to strengthen these institutions for lending to the rural poor through Grameen banks. 

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GSM operators oppose extra spectrum to BSNL

New Delhi, October 9
Private GSM Mobile operators have opposed the government's move to allot additional spectrum to state-run telecom company BSNL, saying it is a clear violation of the contractual and legal rights of the private operators.

In a letter to the telecom secretary D S Mathur, the Cellular Operators Association of India (COAI) demanded that "Department of Telecom (DoT) immediately restore the level-playing field and allot spectrum to all eligible and entitled private GSM applicants, who have been waiting for months and even years in the queue for spectrum."

"Despite serving a legal notice upon the government to allot initial or additional spectrum to the private GSM players as per the eligibility criteria, no response has yet been received from DoT and instead out of turn spectrum allotments had been made to BSNL," COAI director general TV Ramachandran said.

On the other hand, BSNL said the spectrum was allotted to it long ago and COAI was trying to corner every bit of spectrum instead of making any investment to make efficient use of the scarce resource.

Existing players may get priority

The government is close to finalising the guidelines for new entrants in the telecom sector, with a possibility of existing players getting priority in allocation of radio waves. — PTI

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BHEL wins Rs 394-cr RINL contract
Tribune News Service

New Delhi, October 9
Engineering major Bharat Heavy Electricals Limited (BHEL) has won a turnkey contract for setting up a captive power plant at a steel plant in Andhra Pradesh.

Valued at Rs 394 crore, the order has been placed by Rashtriya Ispat Nigam Limted (RINL) for the expansion project of its Vizag Steel Plant in Andhra Pradesh, a release said today.

The Vizag Steel Plant is already equipped with a BHEL-supplied captive power plant, which has been operating successfully for over ten years.

The power plant will meet the power requirement of the upcoming expansion project of the steel plant and is slated for commissioning in a tight schedule of 26 months.

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Assam inks 26 MoUs with Thai companies
Tribune News Service

Guwahati, October 9
Assam expects its first flush of foreign direct investment (FDI) worth $10 million soon in the food-processing sector from a Thai company as spin off from the just-held North- East Investment Opportunities Week in Bangkok under the aegis of union ministry of DONER.

Assam industries and commerce minister Pradyut Bordoloi who led the state delegation to Bangkok business conclave, today informed that the C P Aquaculture Pvt Ltd company of Thailand would make direct investment in the state.

“They are keen to invest $10 million in the state. The officials of the C P Aquaculture Pvt Ltd had visited the state in June this year, as part of a delegation from Thailand led by the Thai Commerce Minister to the NE to explore investment and trade possibilities,” Bordoloi said.

The Thai company which is mostly into packaging and marketing of aqua food, is expected to bring in technology to set up processing units in Assam.

Meanwhile, as many as 26 MoUs were signed between business organisations from Thailand and Assam during the Bangkok meet. The most prominent of those was the MoU between the state government and Thai Contractors Association for exploration of investment opportunities in infrastructure development in the state. 

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Indian-AI merger row reaches SC

New Delhi, October 9
National Aviation Company of India Ltd, the new entity formed after the merger of Indian and Air India, today moved the Supreme Court seeking consolidation of the cases challenging the merger of the two state carriers.

A Bench comprising Justice S B Sinha and Justice H S Bedi issued notice to the ministry of corporate affairs, Registrar of Companies, Indian Commercial Pilots Association, Indian Airlines Officers Association, Air Corporation Employees Union, Airlines Radio Officers and Flight Operation Officers Association, Air India, Indian and others.

The Bench also stayed the proceedings pending before the Bombay High Court.

The petitioners before the high courts had challenged the constitutional validity of Section 620 of the Companies Act and issuance of notification dated February 2, 1978, that conferred powers on the centre to usurp the judicial functions assigned to the high court and exempted merger of government companies from judicial scrutiny.

The notification had also taken away the right to appeal against an order allowing any such merger.

While the three wholly-owened government companies — Air India, Indian Airlines and National Aviation — had passed their board resolutions in May 2007 approving the scheme of merger, the ministry had approved amalgamation in August 22 this year. The matter is listed before the Delhi High Court on October 30.— PTI 

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10 pc GDP growth sustainable: OECD
Tribune News Service

New Delhi, October 9
India’s annual economic growth could reach a sustainable 10 per cent and be spread more evenly across the country if it pursues ambitious and wide-ranging reforms, according to Organisation for Economic Cooperation and Development (OECD).

In its first Economic Survey of India, the OECD, the grouping of 30-rich nations, says “The Indian government’s target of 10 per cent growth by 2011 and complete elimination of poverty can be achieved if economic reforms continue.” The Indian economy had grown by 9.4 per cent in 2007 fiscal.

The survey specifically mentions four areas where reforms were necessary to lift growth — improving the business environment, infrastructure, public finances and labour market reform.

Pointing that red tape still hold back business, the survey said state governments need to become much better organised and builds on improvements made at the national level.

The report also said that government should continue its programme of increased discipline in public spending, which will make room for higher levels of private investment.

“Spending on subsidies should be better targeted to help the poor,” it said while calling for reduction in tax exemptions to allow more money to be transferred to fund public services in urban areas.

The report also suggested that banks should be gradually moved out of the public sector while the government should stop directing bank lending. “These moves would improve allocation of capital and boost growth,” it said calling for more foreign competition in financial services.

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RIL finds oil in Kaveri basin

New Delhi, October 9
Reliance Industries (RIL) has made a significant oil discovery in its offshore Kaveri basin block.

Reliance made the discovery in block CY-DWN-2001/4, also known CY-T5, in August, industry sources said.

The first well drilled in the block, which Reliance has won in third round of NELP auctions, flowed 600 barrels per day of oil during tests.

Sources said the company is making an assessment of reserves in the block. — PTI

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Reliance Life unveils ‘Express Life’
Tribune News Service

Chandigarh, October 9
Reliance Life Insurance today announced the launch of a new policy 'Express Life', which the company claimed is the first 'over-the-counter' policy in the country.

P. Nandagopal, CEO, Reliance Life Insurance, said., customers between the age of 18 to 45 years could avail the benefits of Express Life Service, he said. Aiming to garner a market share of 10-12 per cent in next 2-3 years, the company has planned to spend between Rs 1,000-1,200 crore on expanding its operations. The company aims to sell one million 'Express Life' policies in this financial year.

It is available under the Reliance Life Insurance Automatic Investment Plan, Money Guarantee Plan, Market Return Plan and Golden Years Plan.

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GAIL gas for Bawana plant
Tribune News Service

New Delhi, October 9
GAIL today signed a gas sales agreement with Pragati Power for the gas supply of two metric million standard cubic metres per day (MMSCMD) to Bawana Power Plant.

The gas supply for a 1500 MW combined cycle gas turbine power project, to be set up by Pragati Power Corporation Ltd. (PPCL) at Bawana, will commence from October 2009 and the validity of this agreement will be till 2024. The power plant is likely to be fully commissioned by October 2010 to supply power to Delhi before the Common Wealth Games. The agreement was signed here today by B C Tripathi, director (marketing), GAIL and Viney Kumar, director (technical), PPCL, in presence of Delhi Chief Minister Sheila Dikshit.

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BRIEFLY

ABN Amro deal
London, October 9
A European consortium led by Royal Bank of Scotland yesterday clinched a record $100-billion takeover of ABN Amro, paving the way for the break-up of the Dutch lender. The RBS grouping, which also comprises Belgian-Dutch group Fortis and Spain’ Banco Satander, said in a statement that it had won backing from shareholders representing 86 per cent of ABN shares. — AFP

ICICI awarded
Kolkata, October 9
ICICI Bank has been conferred the 'Outstanding Regional Private Bank (Asia-Pacific)' award by Private Banker International at the just concluded 17th Private Banker International Wealth Management Summit in Singapore. Announcing this here today, Anup Bagchi, head-global private banking, ICICI Bank, said this was the first Indian bank to get this award.— UNI

M'bishi buyout
Tokyo, October 9
Mitsubishi Heavy Industries Ltd, Japan's largest machinery maker, said today it has picked US firm Pratt & Whitney, a unit of United Technologies Corp, to supply engines for its new regional passenger jet. It said it plans to start operating the jets in 2012. — Reuters

Google info
New Delhi, October 9
Mobile users in the country can now easily get local information on their handsets as leading search engine Google today introduced a service to facilitate access to such content. The new offering Google SMS, has been launched in beta version across four cities Delhi, Mumbai, Bangalore and Hyderabad. Google has tied-up with five operators Reliance, Airtel, BSNL, BPL and Aircel for offering the service, Google India head of products Vinay Goel said. — PTI

IOC contract
New Delhi, October 9
Larsen & Toubro (L&T) today said it has received a project worth Rs 693 crore from oil marketing company Indian Oil Corporation (IOC) to set up sulphur recovery units. These units would help IOC produce low-sulphur clean fuels to meet regulatory requirements, a company statement said.— UNI

Cisco Captial
Chandigarh, October 9
Cisco Capital today announced the launch of Easy Lease in Punjab and Haryana. This innovative financing program is designed to enable SMBs to adopt state-of-the-art network technology quickly and easily, with minimal initial investment. It is currently available at a special rate of 7 per cent for a 12 to 36-month term. — TNS

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