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GDP growth down to 8.9 pc
A vendor waits for customers at a market in New Delhi New Delhi, November 30
Sharp fall in the expansion of industrial output slowed down the overall growth of GDP to 8.9 per cent during the second quarter of 2007-08 from 10.2 per cent in the corresponding quarter of last fiscal.

A vendor waits for customers at a market in New Delhi. India’s economic growth slowed to 8.9 per cent in the second quarter to September, hit by a downturn in manufacturing. But expansion in India’s economy was still slightly ahead of analyst expectations’ of around 8.7 per cent growth thanks to healthy agriculture performance. — AFP

State Bank gets nod for Rs 10,000-cr
rights issue

New Delhi, November 30
The country’s largest bank, the State Bank of India (SBI), today got the approval of the Cabinet for enhancing its capital by subscribing to the rights issue of equity shares amounting to about Rs 10,000 crore. The SBI’s first share sale in a decade, would be against the issue of SLR, marketable government securities. The ministry of
finance will contribute Rs 10,000 crore to retain its
59.73 per cent stake.


 
Rolls Royce motors, a subsidary of BMW cars, unveils the new two-door, four-seat convertible Phantom Drophead Coupe in Mumbai
Rolls Royce motors, a subsidary of BMW cars, unveils the new two-door, four-seat convertible Phantom Drophead Coupe in Mumbai on Friday. The car uses 1,300 new parts over those developed for the Phantom and is the first convertible to be offered by Rolls-Royce since 2002. Launched in January, the Phantom Drophead Coupe is priced from $781,000.
— AFP photo

Furnish details about recovery agents: RBI
Mumbai, November 30
The Reserve Bank of India (RBI), in the draft guidelines issued today for banks engaging recovery agents, asked banks to inform borrowers the details of recovery agents engaged for the purpose while forwarding default cases to recovery agents.

Approval for presentation of 11th Plan draft before NDC
Sale of BPCL stake in Bharat
Shell okayed

New Delhi, November 30
The Cabinet today gave its approval for sale of 49 per cent equity stake of Bharat Petroleum Corporation Limited (BPCL) in Bharat Shell Ltd (BSL) to Shell or its affiliate for a consideration of Rs 152.4 crore in cash.

Tata Steel inks pact for Mozambique coal project 
New Delhi, November 30
The picture shows a view of Tata Steel plant in Jamshedpur. Tata Steel has signed a JV with Australia’s Riversdale Mining on Friday to develop a hard coking and thermal coal project in Mozambique Tata Steel today signed an agreement with Australia-based Riversdale Mining to jointly develop hard coking and thermal coal project in Mozambique.

The picture shows a view of Tata Steel plant in Jamshedpur. Tata Steel has signed a JV with Australia’s Riversdale Mining on Friday to develop a hard coking and thermal coal project in Mozambique. Tata Steel is to pay around 100 million Australian dollars ($88 million) to acquire 35 per cent of Riversdale’s Benga and Tete licences in the southern African country. — AFP

Reliance Power gets letter of intent
New Delhi, November 30
Reliance Power today received the contract for setting up the 4,000 MW Krishnapatnam ultra mega power project, which its chairman Anil Ambani says would make the group by far the largest private power producer.

Japanese prefer India for long-term investments 
Tokyo, November 30
India has overtaken China for the first time as the most attractive business destination for long-term Japanese investments, results of a survey by Japan Bank for International Cooperation (JBIC) showed today.

IOC gets approval to acquire stake in OIL
Mumbai, November 30
Indian Oil Corporation (IOC) today said it has received the board approval for acquiring a 5 per cent stake in Oil India Ltd (OIL) from the government.

HP to have first site under Universal Service Obligation 
Shimla, November 30
Reliance Communications launched first site of the country under Universal Service Obligation (USO) at Kuther in Kangra district. The site will provide connectivity to
15 villages.

Inflation at  3.21 pc
New Delhi, November 30
Costlier food and non-food articles pushed up the inflation rate to 3.21 per cent for the week ended November 17 as against 3.01 per cent previous week.

Rs 18,000 cr for NMDC expansion
New Delhi, November 30
NMDC Ltd will invest about Rs 18,000 crore to ramp up its production capacity to 50 million tons (MT) and conduct fresh explorations within the next five years.

Punj Lloyd arm bags Rs 1,272-crore contract
Mumbai, November 30
Punj Lloyd today said one of its subsidiaries has bagged a contract valued at Rs 1,272 crore in Singapore.

Video
Kamath on Forbes list.
(56k)

 

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GDP growth down to 8.9 pc
S. Satyanarayanan
Tribune News Service

New Delhi, November 30
Sharp fall in the expansion of industrial output slowed down the overall growth of GDP to 8.9 per cent during the second quarter of 2007-08 from 10.2 per cent in the corresponding quarter of last fiscal.

India, which is Asia’s third-largest economy, had recorded a growth rate of 9.3 per cent in the first quarter of 2007-08.

According to the official data released here today, manufacturing growth fell to 8.6 per cent from 12.7 per cent in the same period of the previous year. The manufacturing sector had performed far better in the first quarter of the current fiscal with 11.9 per cent growth.

Manufacturing growth was the weakest in seven quarters as high borrowing costs curbed demand for consumer durable goods like cars and motorcycles and thus pulling down the overall growth figures.

Significantly, the farm sector, which had been a drag on sustaining high GDP growth, had a much better performance in the first quarter at 3.8 per cent and in the second at 3.6 per cent as against 2.8 per cent and 2.9 per cent in the corresponding period last year.

Quarterly, GDP at factor cost at constant prices for the second quarter of 2007-08 is estimated at Rs 7,10,578 crore, showing a growth of 8.9 per cent over the figure of Rs 6,52,450 crore in Q2 of 2006-07.

Reacting to the official data, finance minister P Chidambaram said the growth rate is on the expected lines and hoped that the country’s economic growth rate to be “pretty close” to 9 per cent. The RBI has calculated the GDP to remain at 8.5 per cent.

“The overall growth of GDP in the second quarter of 2007-08 at 8.9 per cent remained buoyant. While there was a moderation in the growth in the manufacturing sector largely due to subdued performance of the consumer durables sector, sustained high growth in services and construction sector together with some pick up in the growth of agricultural sector maintained the growth at the current level,” Chidambaram said.

“The growth in the first half of the current year at 9.1 per cent gives the confidence that in the current year also the overall growth will be maintained at 9 per cent level, provided international situation remained comfortable,” he stated.

Pointing that both consumption and investment have been the drivers of this growth, he said gross fixed capital formation (GFCF) increased by 15.2 per cent and its share increased to 30.3 per cent in the second quarter.

“Together with a buoyant capital goods sector and increased construction activities, we can expect the capacity additions to remain buoyant in the coming months,” he said, adding: “Private final consumption expenditure also recorded a growth of 5.6 per cent indicating sustained improvement in the standard of living of the people.”

The areas that registered significant growth in Q2 of current fiscal are mining and quarrying with 7.7 per cent, electricity, gas and water supply 7.3 per cent, construction 11.1 per cent and financial services 10.6 per cent.

Trade, hotel, transport and communication were also up by 11.4 per cent, while the community and personal services sector was up 7.8 per cent.

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State Bank gets nod for Rs 10,000-cr rights issue
S. Satyanarayanan
Tribune News Service

New Delhi, November 30
The country’s largest bank, the State Bank of India (SBI), today got the approval of the Cabinet for enhancing its capital by subscribing to the rights issue of equity shares amounting to about Rs 10,000 crore.

The SBI’s first share sale in a decade, would be against the issue of SLR, marketable government securities. The ministry of finance will contribute Rs 10,000 crore to retain its 59.73 per cent stake.

While the rights issue will ensure that the government’s stake in the bank would remain at 59.73 per cent, it would help the 200-year-old bank bolster its capital and meet the growing demand for credit in productive sectors.

The actual number of shares to be subscribed, the total amount subscribed, coupon rate and tenure of the securities, and other modalities will be worked out by the government in consultation with the bank, keeping in view the extant Sebi guidelines, market conditions and other relevant factors, finance minister P Chidambaram said.

It will enable the government to receive around Rs 1,358 crore by way of divident and taxes from the bank during 2008-09, as against an expenditure of around Rs 790 crore as interest to be paid to the bank for proposed securities.

The additional growth of the bank due to its increased capital base will also have multiplier effect on the overall performance of the bank, which will gain in terms of its position in the industry, ratings - both in international as well as domestic markets, and increased valuation of its stock, besides boost to the economy at large, Chidambaram said.

The transaction will be completed within the current financial year and a securities redemption fund will be created thereafter, he added.

The government will create a securities redemption fund for redeeming these securities on the due date.

The SBI had said last month that it had asked for permission to raise as much as Rs 20,000 crore to invest in its more than 9,500 branches and meet demand for loans from 10 lakh customers.

SBI chairman cum managing director Bhatt had said the bank may need as much as Rs 1 trillion over the next five years to boost loans. The SBI’s share of loans in India has declined to 15.4 per cent as on September 30 from 17.4 per cent in March 2003.

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Furnish details about recovery agents: RBI

Mumbai, November 30
The Reserve Bank of India (RBI), in the draft guidelines issued today for banks engaging recovery agents, asked banks to inform borrowers the details of recovery agents engaged for the purpose while forwarding default cases to recovery agents.

“The details should include their telephone numbers, and other details. The recovery agents should call the borrowers only from the telephone numbers notified to the borrower,” the apex bank said in the guidelines posted on its website for public comments.

The RBI further said complaints received by it regarding abusive practices followed by a banks recovery agents would invite serious supervisory disapproval.

The Reserve Bank would consider imposing a temporary ban (or even a permanent ban in case of persistent abusive practices) for engaging recovery agents on those banks where strictures have been passed or penalties have been imposed by a high court or the Supreme Court or against its directors/officers with regard to the abusive practices followed by their recovery agents.

The central bank also asked the banks to ensure that “contracts with the recovery agents do not induce adoption of uncivilised, unlawful and questionable behaviour or recovery process.” — UNI 

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Approval for presentation of 11th Plan draft before NDC
Sale of BPCL stake in Bharat Shell okayed
Tribune News Service

New Delhi, November 30
The Cabinet today gave its approval for sale of 49 per cent equity stake of Bharat Petroleum Corporation Limited (BPCL) in Bharat Shell Ltd (BSL) to Shell or its affiliate for a consideration of Rs 152.4 crore in cash.

The proposed sale will enable BPCL to withdraw from a joint venture company, which has a competing business interest in production and sale of branded lubricants in India.

This would enable the company to concentrate on building and promotion of its own brand of lubricants resulting in improved brand image, higher growth, efficiency and profits.

The Cabinet also cleared the 11th Five-year Plan to present it before the National Development Council (NDC) for approval. The NDC meeting will be held on December 19. The decision would enable operationalisation of the 11th plan in full.

The Planning Commission, on November 9, had cleared the draft plan document with a target of 9 per cent annual economic growth, up from 7.6 per cent in the 10th Plan period.

The Cabinet also gave its approval for tariff elimination/reduction on 555 products through a protocol of amendment of India-Singapore Comprehensive Economic Cooperation Agreement (CECA) and also for offering to Singapore any subsequent improvement made at the time of Asean- India Free Trade Agreement (Aifta) in terms of product coverage time line, rules of origin with appropriate amendments to India-Singapore CECA.

The tariff concessions would further enhance growth in bilateral trade with economic benefits to both countries. As Singapore is a member country of Asean, betterment made in the Aifta over CECA may be incorporated in CECA to maximise gains to both countries.

The tariff elimination/reduction will commence from December 1.

In another major decision, the Cabinet gave approval to enhance India’s contribution to Rs 10,000 crore per annum under non-plan during the next five years for the International Centre for Genetic Engineering and Biotechnology (ICGEB), Delhi.

Nod was also given to the continuation of the host country contribution beyond 2011-12, coterminous with the currency of the agreement already ratified by the government.

It also gave nod for placing the National Urban Housing and Habitat Policy, 2005 on the table of the House and general circulation to the state governments/UTs and other stakeholders for implementation.

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Tata Steel inks pact for Mozambique coal project 

New Delhi, November 30
Tata Steel today signed an agreement with Australia-based Riversdale Mining to jointly develop hard coking and thermal coal project in Mozambique.

Tata Steel would pay around 100 million Australian dollars (Rs 351.48 crore) to acquire a 35 per cent stake in the project, apart from a 40 per cent share of the off-take of coking coal, Tata Steel said.

The coking coal derived by the company would be supplied to its facilities in Europe, Asia and elsewhere.

“The global steel business of Tata has an increasing need to source coal, and the Mozambique coal project is well positioned to help meet their future demands for hard coking coal,” Riversdale chairman and CEO Michael O’Keeffe said.

The homegrown steel major would hold a key position in the joint venture. The JV would comprise of two licences - Benga and Tete licences - and cover an area of 24,960 hectares.

Tata Steel with its vast experience of coal mining will be contributing technical expertise to the JV formed to develop the Mozambique coal project, Tata Steel’s managing director B Muthuraman said.

“This investment is a significant step in Tata Steel’s initiatives for raw material security and will enhance its long term competitiveness,” he added.

Earlier, Riversdale had announced that it would raise up to 235 million Australian dollars (Rs 825.62 crore), which would be additional funds to develop the company’s projects in Mozambique. — PTI

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Krishnapatnam Power Project
Reliance Power gets letter of intent

New Delhi, November 30
Reliance Power today received the contract for setting up the 4,000 MW Krishnapatnam ultra mega power project, which its chairman Anil Ambani says would make the group by far the largest private power producer.

With a bid of Rs 2.33 per unit, Reliance beat Larsen and Toubro and Sterlite Industries for the project.

Coastal Andhra Power (CAPL), the special purpose vehicle formed by Power Finance Corp, awarded the letter of intent to Reliance Power.

“We will import 14-17 million tons of coal a year for the project depending upon the quality available,” Reliance Energy director (business development) J P Chalasani said.

The estimated investment required for the project in Andhra Pradesh would be around Rs 16,000-17,000 crore, he said.

“Financing for ultra mega power projects, which are based on a good structure, should not be a problem for us,” Chalasani said.

“This (LoI) will rank Reliance Power as by far the largest private sector generator of power in this country,” company chairman Anil D Ambani said.

First unit of the 5x800 MW Krishnapatnam project would be commissioned within 68 months from the date of transfer of CAPL to Reliance Power. The other four units would come up within a period of 93 months.

“It is likely that CAPL will be transferred within a period of two months, that is on January 30,” CAPL chairman Satnam Singh said.

Singh said the power purchase agreements have been signed with Andhra Pradesh, Maharashtra, Tamil Nadu and Karnataka for supplying power from the Krishnapatnam project for 25 years.

Andhra Pradesh will receive 1,600 MW, while Maharashtra, Tamil Nadu and Karnataka will offtake 800 MW each from the project.

“All regulatory clearances for the project are in place except some small gaps, which would be filled in shortly,” Singh said. Power Grid Corp is developing a transmission system for evacuation of power from the project. — PTI 

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Japanese prefer India for long-term investments 

Tokyo, November 30
India has overtaken China for the first time as the most attractive business destination for long-term Japanese investments, results of a survey by Japan Bank for International Cooperation (JBIC) showed today.

According to the JBIC’s annual survey, 70 per cent of surveyed Japanese manufacturers regarded India as an attractive country to do business in over the next 10 years or so, while 67 per cent preferred China. Russia came third, with a 37 per cent rating, followed by Vietnam at 28 per cent.

From a three-year or so prospect, China remains the most attractive base of production, marketing and other operations for Japanese manufacturers.

But China’s popularity rate has declined for the fourth year in a row since it peaked in fiscal 2003, while India, Vietnam, and Russia have boosted their popularity, Kyodo news agency reported. The survey, which was conducted in July and August, covered 970 Japanese manufacturers with overseas production facilities. — PTI

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IOC gets approval to acquire stake in OIL

Mumbai, November 30
Indian Oil Corporation (IOC) today said it has received the board approval for acquiring a 5 per cent stake in Oil India Ltd (OIL) from the government.

In a filing to the Bombay Stock Exchange, the firm said it would acquire 1,07,00,220 equity shares totalling to 5 per cent of OIL’s paid up capital at a price equivalent to its initial public offer’s (IPO) issue price.

The IPO of OIL is slated for the first quarter of 2008 and it plans to issue 2.64 crore shares of par value of Rs 10 each to the public. Out of this, 24.04 lakh shares will be given to its employees.

Presently, the government has 98.17 per cent stake in the company, while the remaining is with the employees. After the IPO, the government’s stake will come down to 78.43 per cent.

The government is divesting 10 per cent of its equity to the general public and is selling a similar quantum to IOC, Bharat Petroleum and Hindustan Petroleum. The remaining stake will remain with the employees.

The sale and purchase of these stakes would be completed within two days after the issue price of the public offer is determined through the book building method and approved by the board of directors of OIL. The closing would be completed prior to allotment of the equity shares through IPO. — PTI 

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HP to have first site under Universal Service Obligation 
Tribune News Service

Shimla, November 30
Reliance Communications launched first site of the country under Universal Service Obligation (USO) at Kuther in Kangra district. The site will provide connectivity to 15 villages.

The villages, covered by the site, include Cheliyan, Nadholi, Jangal Khas, Kuther, Dol, Siuni, Trilokpur, Bagga, Tharoo, Anui Khas, Bharmara, Diala, Kaldun, Hariyan and Dul spread over six panchayats. In all, over 3,000 households with a population of 14,500 will be covered.

Chief operating officer of Himachal circle Rahul Chaudhary said the endeavour was to provide the best of network to every citizen of the state. The product and services are world class and attractively priced so that every person in the state could benefit from the state-of-the-art telecom technology.

He said work was already underway to expand the network and very soon Reliance Mobile and Reliance Mobile Smart GSM services network would be spread to the remote and farthest corner of the state. The company had recently announced the launch of world’s first feature-rich colour handset at an affordable price of Rs 999 and monochrome handset at an iconic price of Rs 777. 

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Inflation at  3.21 pc
Tribune News Service

New Delhi, November 30
Costlier food and non-food articles pushed up the inflation rate to 3.21 per cent for the week ended November 17 as against 3.01 per cent previous week.

The annual inflation rate was 5.56 per cent during the corresponding week of the previous year, according to official data released here today.

The index for primary articles rose by 0.4 per cent to 224.3 (provisional) from 223.1 (provisional) for the previous week.

The index for food articles group rose by 0.5 per cent to 224.2 (provisional) from 223.1 (provisional) for the previous week. The index for non food articles group rose by 0.3 per cent to 208.6 (provisional) from 207.9 (provisional) for the previous week.

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Rs 18,000 cr for NMDC expansion

New Delhi, November 30
NMDC Ltd will invest about Rs 18,000 crore to ramp up its production capacity to 50 million tons (MT) and conduct fresh explorations within the next five years.

"We would invest about Rs 18,000 crore in the next five years to ramp our production capacity to 50 million tons of iron ore, besides conducting fresh explorations. We are keen to expand our operations in a big way to meet the growing requirements of the domestic steel producers," company CMD Rana Som said.

Som said the organisation would produce 3.1 lakh tons of iron ore this year and was chalking out plans to acquire mines.

NMDC, along with the Steel Authority of India Ltd (SAIL) and Rashtriya Ispat Nigam Ltd (RINL), is building a 4-million-tonne steel plant in Chhattisgarh at the cost of Rs 1,244 crore, he added. — PTI

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Punj Lloyd arm bags Rs 1,272-crore contract

Mumbai, November 30
Punj Lloyd today said one of its subsidiaries has bagged a contract valued at Rs 1,272 crore in Singapore.

Sembawang Engineers and Constructors Pvt Ltd, a wholly-owned subsidiary of Punj Lloyd, has won the contract for the proposed Bayfront Mass Rapid Transit station at Marina Bay in Singapore, it said in a filing to the Bombay Stock Exchange.— PTI

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