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THE TRIBUNE SPECIALS
50 YEARS OF INDEPENDENCE

TERCENTENARY CELEBRATIONS

B U S I N E S S

SEBI allows short selling
Mumbai, December 20
Market regulator SEBI today decided to permit all classes of investors — institutional and retail — to sell shares without owning them at the time of trade.

Tatas set to buy Ford icons
Formal announcement today
London, December 20
Indian conglomerate Tatas are set to be named tomorrow the top choice for buying the US auto giant Ford's iconic British brands Jaguar and Land Rover, according to a media report here.

Seek apology from Orient Hotels
New York, December 20
Tatas have sought an apology from Orient-Express Hotels (OEH) for its "libellous" remark that sought to show the Indian conglomerate's hospitality business in poor light.

Ratan Tata 1 lakh car, Jaguar can co-exist: Tata
Tata Sons chairman Ratan Tata has said it should not be impossible for the world's cheapest (Rs 1 lakh) car to co-exist with prestigious brands like Jaguar and Land Rover despite an image disparity.

Marriage In Air
Deccan to merge with Kingfisher
Bangalore, December 20
Vijay Mallya-led Kingfisher Airlines and low-cost carrier Air Deccan have decided to merge for cutting costs and returning to profitability as the combined entity gets ready to fly abroad next year.

Spectrum Row
GSM players to knock HC door
New Delhi, December 20
Taking the government head on, four GSM mobile operators —Bharti Airtel, Vodafone, Idea and Spice — have decided to "unitedly" approach the Delhi High Court against telecom tribunal TDSAT's interim order not to stay the spectrum allocation process.

Exporters’ Woes
Mechanism to refund taxes under way: Nath
New Delhi, December 20
Commerce and industry minister Kamal Nath today said the Centre is drawing up a mechanism for refund of taxes to exporters levied by the state governments to make exports more competitive.

A model poses with Nokia 6110 Navigator, capable of fully integrated GPS navigation solution, at its launch in New Delhi on Thursday.
A model poses with Nokia 6110 Navigator, capable of fully integrated GPS navigation solution, at its launch in New Delhi on Thursday. — Tribune photo by Manas Ranjan Bhui








EARLIER STORIES

 

Deputy chairman of Planning Commission Dr Montek Singh Ahluwalia presents PHD Chamber Annual Award for Excellence 2007 to Dr (Col) C.S. Pant (retd), VSM, at a function in New Delhi on Thursday. PHDCCI honours Dr C.S. Pant
New Delhi, December 20
Dr (Col) C.S. Pant (retd), VSM, project director of Uttaranchal Mobile Hospital and Research Centre (UMHRC), was today awarded PHD Chamber Annual Award for Excellence 2007 for his outstanding contribution to social welfare.

Deputy chairman of Planning Commission Dr Montek Singh Ahluwalia presents PHD Chamber Annual Award for Excellence 2007 to Dr (Col) C.S. Pant (retd), VSM, at a function in New Delhi on Thursday. — Tribune photo by Manas Ranjan Bhui

Inflation at 3.65 pc
New Delhi, December 20
Inflation dipped to 3.65 per cent for the week ended December 8 as against 3.75 per cent in the previous week, due to fall in prices of some food articles and some manufactured items.

Entertainment Industry 
Tax structure to be revamped: Minister
New Delhi, December 20
Information & broadcasting minister Priya Ranjan Dasmunsi yesterday said a complete overhauling would be brought about in the tax structure for entertainment industry in the 2008-'09 Budget to enable it attain a global position.

Boeing inks $1-b deal with HAL
New Delhi, December 20
In the biggest-ever deal for a public sector defence undertaking, Hindustan Aeronautics Limited (HAL) has signed a $1-billion manufacturing outsourcing contract with American aerospace major Boeing over 10 years.

RCom buys US firm for $300m
New Delhi, December 20
Reliance Communications (RCom) today said it has acquired US-based Yipes Holdings Inc for $300 million.

Germany to lend euro 190m
New Delhi, December 20
The ministry of finance, Department of Economic Affairs, and the German Government Bank, KfW, signed two loan agreements for effectuating financial assistance from Germany amounting to euro 190 million today.

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SEBI allows short selling

Mumbai, December 20
Market regulator SEBI today decided to permit all classes of investors — institutional and retail — to sell shares without owning them at the time of trade.

"The stock exchanges would issue the necessary guidelines in this regard and will put in place systems to operationalise the mechanism of short-selling," SEBI said in a circular here.

However, the system of "naked short selling" as is available in the US markets has not been allowed, and all investors must honour their obligation of delivering the securities at the time of settlement.

In order to provide for a mechanism for borrowing of securities to enable settlement of securities that are sold short, SEBI has decided to implement a full-fledged securities lending and borrowing scheme for market participants. Stock exchanges would issue guidelines in this respect as well.

SEBI advised stock exchanges and depositories to put necessary systems in place to distinguish between the lending and borrowing transactions executed for short selling from the normal market transactions in the demat system. The market regulator will intimate date of implementing short-selling later.

While retail investors were already allowed to short-sell, the decision to include institutional investors is likely to encourage these players in the stock market.

SEBI's decision to allow short-selling and come out with broad framework in this direction is good for the market as it would create more liquidity, brokerage firm SMC global vice-president Rajesh Jain said. Stock markets should welcome the news tomorrow, if global cues are also positive, he said.

As per the broad framework for short-selling issued by SEBI, no institutional investor would be allowed in day trading, which means squaring-off transactions intra-day.

Institutional investors would disclose in advance at the time of placement of order whether the transaction is a short sale. However, retail investors would be permitted to make similar disclosure by the end of the trading hours on the transaction day.

Securities traded in futures and options segment will be eligible for short-selling and SEBI may review the list of stocks eligible for such transactions from time to time.

Brokers will be asked to collect the details on scrip-wise short sell positions, collate the data and upload it to the stock exchanges before the commencement of trading on the following trading day. The stock exchange would then consolidate such information and disseminate them on their websites for the information of the public on a weekly basis.

For short-selling, a scheme of lending and borrowing securities is essential. To begin with, this borrowing and lending programme would be operated through clearing corporation, and clearing house of stock exchanges having nation-wide terminals who will be registered as Approved Intermediaries (AIs).

Initially, the securities traded in F&O segment would be eligible for lending and borrowing under the scheme. To start with, contracts with tenure of seven trading days may be direct agreement between the lender and the borrower, SEBI said. — PTI

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Tatas set to buy Ford icons
Formal announcement today

London, December 20
Indian conglomerate Tatas are set to be named tomorrow the top choice for buying the US auto giant Ford's iconic British brands Jaguar and Land Rover, according to a media report here.

"The group has had its £1-billion bid accepted by Ford... the firm has beaten off competition from rival Indian firm Mahindra and Mahindra and private equity group One Equity Partners," Birmingham Post reported today.

The report quoted unnamed sources at Land Rover as saying, "It is definitely Tata. There is one final meeting and so long as there is no last minute hitches, which are not expected, then an announcement will be made on Friday." The final details would be worked out in the next six weeks, it added.

The report also quoted a union official as saying that Mahindra's bid fell flat because of links to a private equity firm as the Indian firm was working with Apollo.

"When a private equity firm buys a company, the cost of buying it often goes onto the companies books. If anything then goes wrong how do you refinance the business?" industry officer for the Transport and General Workers' Union section of Unite, Des Quinn, said.

Birminghan Post said Tata officials are coming from India to the UK for the announcement and the deal has been supported by the staff as well as the government.

Noting that unions had approved the decision, the report quoted Quinn as saying: "We cautiously welcome this development, although the devil will be in the detail." "We think the Tata bid is in the best interests of our members. They come from a manufacturing background, and the experience of other people they have taken over has been good.

They are cash rich and they can afford the price, as well as invest in the future," Quinn said. — PTI

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Seek apology from Orient Hotels

New York, December 20
Tatas have sought an apology from Orient-Express Hotels (OEH) for its "libellous" remark that sought to show the Indian conglomerate's hospitality business in poor light.

In a strongly worded letter to OEH's CEO Paul White, Indian Hotels vice-chairman R K Krishna Kumar said that "the purpose of this letter is not to pursue a dialogue directly with you but instead to set the record straight on our intentions in approaching your company."

The Indian Hotels executive added that given Taj Hotels' reputation as one of the world's most trusted brands in hospitality, he felt compelled to correct the misinformation that has been circulating in the news media as a result of the letter written by White.

White in a letter to Indian Hotels had said that tying up with the "predominantly Indian" hospitality firm will erode the US hospitality chain's brand image. — PTI

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1 lakh car, Jaguar can co-exist: Tata

Tata Sons chairman Ratan Tata has said it should not be impossible for the world's cheapest (Rs 1 lakh) car to co-exist with prestigious brands like Jaguar and Land Rover despite an image disparity.

In an interview to 'The Times', Tata Motors chief Ratan Tata exuded confidence in his company's ability to manage a diverse portfolio starting from the Rs 1 lakh car to British marquees Jaguar and Land Rover.

"How a company manages products in different sectors is the key. Toyota created Lexus, Nissan has Infiniti. No one is saying how can BMW handle the Mini? But they've made a huge success of it. So why is it impossible?" Tata said on being asked how would JLR fit into his company's product portfolio.

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Marriage In Air
Deccan to merge with Kingfisher

Bangalore, December 20
Vijay Mallya-led Kingfisher Airlines and low-cost carrier Air Deccan have decided to merge for cutting costs and returning to profitability as the combined entity gets ready to fly abroad next year.

The Boards of the two companies at a joint meeting last night unanimously decided to merge the airlines after management consulting firm Accenture recommended taking this step for greater operational and marketing synergies.

"Air Deccan will continue to be listed, incorporating the businesses of both Kingfisher Airlines and Deccan itself but the listed entity's name will be changed to Kingfisher Airlines," UB Group Chairman Vijay Mallya said.

"Hopefully, at the start of next year (April 2008), we should have one listed entity," Mallya said.

The combined entity would offer low-fare service under the Deccan brand and premium services under Kingfisher brand.

"It (Deccan and Kingfisher) will be one company, and eligible to fly (internationally) in 2008," Mallya said.

He said one of the key elements of the Accenture report is route rationalisation between the two airlines. "It's not going to one (airline) at the cost of another," he said.

Details of the merger, valuations and swap ratio would be done by KPMG, while Dalal & Shah were appointed to "very quickly" come up with valuations and suggest merger structure.

UB Group had earlier this year acquired 46 per cent stake in Deccan Aviation Ltd, which operates Air Deccan, to become its single largest shareholder.

Mallya would be the chairman and CEO of the merged firm, while G R Gopinath would be the vice-chairman. The merged entity would be majority-owned by UB Holdings. — PTI

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Spectrum Row
GSM players to knock HC door

New Delhi, December 20
Taking the government head on, four GSM mobile operators —Bharti Airtel, Vodafone, Idea and Spice — have decided to "unitedly" approach the Delhi High Court against telecom tribunal TDSAT's interim order not to stay the spectrum allocation process.

"The Department of Telecom (DoT) decision is an attempt to pass off second and new GSM licence to CDMA operators in the garb of dual technology allocation," GSM lobby Cellular Operators Association of India (COAI) said in a statement.

The COAI said it has decided to approach the High Court, as TDSAT has not given any justification for its interim order not to stay the spectrum allocation process.

The Telecom Disputes Settlement and Appellate Tribunal (TDSAT), on December 12, had refused to stay the issuance of new licenses to those who had applied as of September 25.

Appearing on behalf of the government, solicitor general G E Vahanvati had said before TDSAT that the government would go ahead with the allotment of start-up spectrum to the new players. — PTI

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Exporters’ Woes
Mechanism to refund taxes under way: Nath
Tribune News Service

New Delhi, December 20
Commerce and industry minister Kamal Nath today said the Centre is drawing up a mechanism for refund of taxes to exporters levied by the state governments to make exports more competitive.

While addressing delegates at the 102nd annual session of PHD Chamber of Commerce and Industry here today, he said the state governments should be sensitised about the benefits they would accrue in terms of attracting more investments and generating more employment by augmenting exports.

“No tax should be exported that will erode the competitiveness”, he said, emphasising that the state governments should work in tandem with the Centre to arrest the slowdown in exports due to hardening of rupee against the US dollar and high interest rates.

“There are several formulations we are looking at. The state governments could refund the levies to exporters, adjusting it against allocation (from the Centre),” he said on the sidelines of the meeting.

Asked whether subsidy reduction by developed countries would help early conclusion of the Doha Round of the WTO, he said “everything depends on the US and the EU.”

He also clarified that the present increase in the commodities prices have nothing to do with the retail sector and added that the government is monitoring the supply side to take timely and adequate action.

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PHDCCI honours Dr C.S. Pant
Tribune News Service

New Delhi, December 20
Dr (Col) C.S. Pant (retd), VSM, project director of Uttaranchal Mobile Hospital and Research Centre (UMHRC), was today awarded PHD Chamber Annual Award for Excellence 2007 for his outstanding contribution to social welfare.

Dr (Col) Pant, an eminent radiologist and past president of the Indian Radiological and Imaging Association, received the award from deputy chairman of Planning Commission Dr Montek Singh Ahluwalia here at the 102nd annual session of the PHDCCI.

As project director, Dr Pant has been responsible for conceiving, implementing and supervising this unique healthcare model. It was launched by President of India in October 2002 at Almora in Uttarakhand.

The project is being implemented by the Birla Institute of Scientific Research Bhimtal (Kumaon Region) and has recently (April 2007) been launched in Garhwal region, which is being implemented by HIHT, Dehra Dun.

First-of-its-kind in the country, wherein modern diagnostics and curative healthcare is being provided to poor and needy people at their doorstep in remote, under-served and inaccessible areas of Uttarakhand, the citation read.

This has not only benefitted directly the poor and vulnerable people of Uttarakhand, but has also ushered in an innovative technology, rigorous processes and a unique public-private partnership to reach people in other regions, and is being widely replicated across the country.

The project was evaluated by USAID, which clearly states the usefulness and the positive impact made by this model. The project was also evaluated as a case study by Faculty of Management Studies, University of Delhi. Based on their evaluation report, this model has been mentioned as a concept note in the 11th Five-Year Plan for public-private partnership in the health sector.

The strength of the model is manifest in the fact that the Government of India has approved a total of 491 similar units for the entire country under the NRHM.

While Vandana Luthra, founder and mentor of VLCC Group, bagged the Outstanding Businesswoman Award, founder and CEO of Yes Bank Rana Kapoor was conferred with Distinguished Entrepreneurship Award.

Good Corporate Citizen Award went to Jaiprakash Associates Ltd, a well-diversified infrastructural and industrial conglomerate in India.

This year the awards jury was chaired by former Chief Justice of India YK Sabharwal.

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Inflation at 3.65 pc
Tribune News Service

New Delhi, December 20
Inflation dipped to 3.65 per cent for the week ended December 8 as against 3.75 per cent in the previous week, due to fall in prices of some food articles and some manufactured items.

The wholesale price index (WPI) based inflation stood at 5.63 per cent in the corresponding week a year ago.

During the week, prices of fruits and vegetables and pulses declined, while barley got dearer.

Among manufactured items, prices of fuel and lubricants remained unchanged, while imported edible oil, coconut oil, gur, mustard oil and atta got expensive.

Prices soyabean oil, suji and rice bran oil also moved down during the week, according to the government data released here today.

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Entertainment Industry 
Tax structure to be revamped: Minister
Tribune News Service

New Delhi, December 20
Information & broadcasting minister Priya Ranjan Dasmunsi yesterday said a complete overhauling would be brought about in the tax structure for entertainment industry in the 2008-'09 Budget to enable it attain a global position.

Delivering a keynote address at Assocham-organised seminar, ‘Focus 2007’, on media and entertainment here, the minister announced that he was negotiating with the finance minister for bringing about huge tax rebates for film and entertainment industry based on the recommendations of various groups set up to suggest changes in taxation.

He said strict measures would also be adopted to curb piracy in the entertainment sector so that the film and entertainment industry does not suffer revenue losses, which were currently estimated between 25 to 30 per cent.

Dasmunsi said recommendations made by two groups set up for revenue generation and digitalisation and overall exchange programmes would be discussed in detail with all stakeholders soon.

He said his ministry would convene a meeting of all stakeholders in Mumbai in the next few weeks and finalise the agenda for bringing about structural changes in the entertainment sector so that the industry grows to a size of over Rs 75,000 crore in the coming years.

Dasmunsi also said his ministry would be signing a memorandum of understanding with the UK so that domestic entertainment and film industry and its counterparts in the UK can source material for film making of global standards. The government has already signed such MoUs with Germany and Italy.

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Boeing inks $1-b deal with HAL

New Delhi, December 20
In the biggest-ever deal for a public sector defence undertaking, Hindustan Aeronautics Limited (HAL) has signed a $1-billion manufacturing outsourcing contract with American aerospace major Boeing over 10 years.

Under a memorandum of understanding (MoU) signed here by Jim Albaugh, president of Boeing Integrated Defence System and HAL chairman Ashok K Baweja, the Indian defence PSU, will manufacture subsystems for Boeing's wide range of fighter planes like F-15, F-18 Super Hornetts and Apace Helicpoters.

Boeing, which is vying for India's major defence contracts for purchase of 126 multi-role combat aircraft, eight long-range maritime reconnisance planes made it clear that the outsourcing was "without any strings".

Albaugh, however, said Boeing was seeking clearance by the Indian government if it could use part of the staggering amount as credit against any future offsets if it secures any major contract. — PTI

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RCom buys US firm for $300m

New Delhi, December 20
Reliance Communications (RCom) today said it has acquired US-based Yipes Holdings Inc for $300 million.

With the acquisition of Yipes, RCom will accelerate its penetration into the lucrative $100-billion global enterprise and institutional data services market and will serve its overseas customers directly in the USA.

“The Federal Communications Commission (FCC) approval is an important step for Reliance to accelerate its plans to expand Yipes’ coverage in the US domestic market. This step also paves the way to extend Yipes’ services worldwide over FLAG’s global next-generation network, creating significantly more value from our undersea network assets in the strongholds of India, the West Asia and East Asia,” RCom president (global business) and FLAG Telecom CEO Punit Garg said.

Yipes’ customers will enjoy broader coverage, access to more international markets, and the rollout of new innovative services. — UNI

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Germany to lend euro 190m
Tribune News Service

New Delhi, December 20
The ministry of finance, Department of Economic Affairs, and the German Government Bank, KfW, signed two loan agreements for effectuating financial assistance from Germany amounting to euro 190 million today.

The first agreement is for providing soft loan of euro 140 million for the purpose of revamping the rural co-operatives in India through the project ‘Reform of the Rural Cooperative Credit Structure Project’ which will be implemented by Nabard.

The government of Germany had committed the funds in separate tranches during the Indo-German annual negotiations held in 2005 and 2006, respectively. The funding is to be used for financing the cooperative credit structure reforms in the country, which is also being co-financed by the ADB. The project is being implemented by Nabard, an official statement said here.

In addition, Loan and Financing Agreement for ninth tranche of German assistance amounting to euro 50 million for Pulse Polio Immunization Programme of the Health Ministry was also signed.

The agreements were signed by Kumar Sanjay Krishna, joint secretary, Department of Economic Affairs on behalf of Government of India and Uwe Ohls, senior vice-president for Asia, KfW.

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