SPECIAL COVERAGE
CHANDIGARH

LUDHIANA

DELHI



THE TRIBUNE SPECIALS
50 YEARS OF INDEPENDENCE

TERCENTENARY CELEBRATIONS
B U S I N E S S

PM’s panel pegs growth at 7.1 pc in
FY ’09-10

Mumbai, February 20
Amidst fears of slowdown in the Indian economy, a top economist today said the country's GDP is likely to grow by 7.1 per cent in the next fiscal, the same pace that has been forecast for the year 2008-09, and India is likely to see a lower interest rate regime.

Satyam Saga
CBI registers case against Raju
No relief for investors: Govt
New Delhi, February 20
The CBI today registered a case against the founder of Satyam Computer Services, B. Ramalinga Raju, and other officials of the company in connection with the Rs 7,800-crore financial fraud in it.

L&T studying CLB order
Mumbai: Engineering major Larsen and Toubro (L&T) said today it was studying the order by the Company Law Board, which permitted Satyam Computer Services to offer fresh equity and an open offer to a strategic investor.



EARLIER STORIES



SBI car loans at 10 pc
Mumbai, February 20
The country's largest public sector lender, State Bank of India, today said it will freeze interest rates on new car loans at 10 per cent for a period of one year. The bank also slashed lending rate on credit to farmers against cold storage and warehouse receipts to 8 per cent, a bank release issued here said. The new rates will be applicable to all customers availing loans between February 23 and May 31, 2009, the bank said. After the freeze-period, the rates will be reset at the applicable card rate contracted as on the date of sanction under the respective schemes. — PTI

Cotton production to fall
Ludhiana, February 20
The cotton production in the Punjab circle, comprising Punjab, Haryana and Rajasthan, may fall this year compared with the production of last year. This is despite the fact that the farmers got good yield and price of cotton in the region was higher compared with the prices of the last year. Even the government enhanced the minimum support price of cotton by 40 per cent this year.

RIL refused to sign gas sale pact with NTPC: Govt
New Delhi, February 20
The government today said Reliance Industries Ltd (RIL) had accepted the Letter of Intent (LoI) placed on it by NTPC for supplying gas to the power major's plants but refused to sign the Gas Sales and Purchase Agreement agreed upon.

Telcos asked to put security code in place by March 31
New Delhi, February 20
The government has decided to give the cellular service providers more time to set in place the equipment required to bar calls from mobile phones that do not have the International Mobile Equipment Identity (IMEI) - a unique 15-digit identity code for mobile handsets.

IOL Chemicals to expand capacity
Chandigarh, February 20
Ludhiana-based IOL Chemicals and Pharmaceuticals Limited will invest Rs 216 crore towards capacity expansion for its various product lines, including its most successful pharma product Ibuprofen.

Nath rules out change in FDI policy
New Delhi, February 20
Unfazed by criticism over allowing "backdoor" entry to foreign investment in sectors like retail, the government today ruled out review of the new FDI policy that keeps indirect FDI out of sectoral caps.






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PM’s panel pegs growth at 7.1 pc in FY ’09-10

Mumbai, February 20
Amidst fears of slowdown in the Indian economy, a top economist today said the country's GDP is likely to grow by 7.1 per cent in the next fiscal, the same pace that has been forecast for the year 2008-09, and India is likely to see a lower interest rate regime.

"Indian economy is likely to grow by around 7.1 per cent ... in 2009-10," Suresh Tendulkar, who is chairman to the Prime Minister's Economic Advisory Council, told a seminar here.

Though likely to be weak in the first half of the next financial year, the GDP growth will bounce back to healthy levels in the second half, on the back of improving fiscal and monetary conditions in the economy.

"The growth may be weaker in the first half, but is likely to pick up in the second half," Tendulkar said.

After clocking over nine per cent growth in the last three years, the government had lowered the growth projections for the current fiscal at 7.1 per cent in the face of global financial crisis.

With inflation being at very low level, interest rates are expected to ease in the coming months on the back of fiscal and monetary measures taken in the recent months, he said.

"I clearly see a lower interest rate regime (in the period ahead)," he added.

Though the global financial turmoil may deteriorate the asset quality in the banking system, Indian banks are better placed to face the crisis than their counterparts abroad, Tendulkar said.

Noting that the credit crunch has impacted the availability of funds to corporates and primarily SMEs, he said, the revival in loan markets are likely to be faster than that of equity markets.

"Loan markets would revive earlier than equity markets.... Accessing external funding sources is difficult in the current circumstances but it is not closed," he said. Falling inflation, amongst other factors in the economy, has given headroom to the central bank to cut its policy rates, he added.

"I am of the view that there is headroom for reduction. But how and when RBI would do that I cannot say," Tendulkar said.

Highlighting that regaining consumer confidence is a key-factor for the revival of economies worldwide, he said "the crisis of confidence in the advanced economies has been quite serious".

The global financial meltdown has affected export-related sectors in the domestic market very seriously and the crisis in advanced economies has turned out more serious than expected, he said. — PTI

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Satyam Saga
CBI registers case against Raju
No relief for investors: Govt

Girja Shankar Kaura
Tribune News Service

New Delhi, February 20
The CBI today registered a case against the founder of Satyam Computer Services, B. Ramalinga Raju, and other officials of the company in connection with the Rs 7,800-crore financial fraud in it.

In a related development, the government, after reiterating that their would be no bailout for the Satyam, today made it clear that there would be no financial assistance for the investors or the companies hit as a result of the fraud.

A day after External Affairs Minister Pranab Mukherjee informed Parliament that there would be no slackness in the investigations in the case, the CBI has gone ahead to constitute a team consisting of top CBI officials and chartered accountants to go into the fraud, which came to light on January 7 last.

The government, had, on Wednesday said that CBI would be taking over the probe into the case.

The agency registered an FIR against Raju and other accused, including the then directors and the auditiors. It also formed a 14-member Multi-Disciplinary Investigation Team (MDIT) for the probe.

The CBI statement said, "The CBI has also constituted a MDIT headed by V.V. Lakshmi Narayana, DIG, CBI, Hyderabad, to undertake a thorough probe into the Satyam scam. The Superintendent of Police, CBI, Hyderabad, will be the chief investigating officer". "Apart from these officers, MDIT will consist of a Superintendent of Police, Bank Securities and Fraud Cell (BS&FC) and 11 other officers of CBI. AGM, State Bank of India (technical officer in CBI), will also be part of this team."

The statement also said that the Institute of Chartered Accountants of India (ICAI) had nominated five experienced chartered accountants to be part of this team and that Institute of Cost and Works Accountants of India (ICWAI) had also agreed to nominate two of its officers to be part of the team. The Cabinet Secretariat has promised to provide necessary support of the departments, ministries and institutions like SEBI, Registrar of Companies, Serious Fraud Investigation Office, Enforcement Directorate and Income Tax into the probe. The statement further said that the Revenue Department of government of Andhra Pradesh will also nominate an officer to liaise in the case.

The agency would now be in a position to interrogate Ramalinga Raju and the others for up to nine days.

Meanwhile, Corporate affairs Minister P C Gupta in a written reply in Parliament said, "The government has no plan to provide financial assistance to the investors or the companies involved". The Minister said the losses suffered by investors "are not quantifiable as capital market fluctuations are caused by a variety of factors".

He added, "The shares of companies are bought and sold continuously by investors at their own choice at various prices and at different times,” and disclosed that the new directors were taking necessary steps to secure finances from banks and financial institutions.

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L&T studying CLB order

Mumbai: Engineering major Larsen and Toubro (L&T) said today it was studying the order by the Company Law Board, which permitted Satyam Computer Services to offer fresh equity and an open offer to a strategic investor.

L&T chairman A M Naik told reporters here today that a decision would be taken in due course. "We are studying details of the Company Law Board (CLB) order. We will take a decision after studying the details," Naik told reporters. L&T holds 12 per cent stake in the troubled software company. — TNS

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Cotton production to fall
K.S. Chawla

Ludhiana, February 20
The cotton production in the Punjab circle, comprising Punjab, Haryana and Rajasthan, may fall this year compared with the production of last year. This is despite the fact that the farmers got good yield and price of cotton in the region was higher compared with the prices of the last year. Even the government enhanced the minimum support price of cotton by 40 per cent this year.

The overall cotton production in the country is also expected to fall by 7 per cent to 8 per cent. The experts estimate that the cotton production will be around 285 lakh bales against 315 lakh bales last year. The reason for the fall in the production of cotton are late rains in the central Indian states like Madhya Pradesh, Maharashtra and Gujrat. The fall in the cotton production in the Punjab circle is attributed to the decrease in the area under cotton.

The Cotton Corporation of India (CCI) has been the main buyer of cotton in the Punjab circle as the prices being higher, the private millers did not show much interest. Besides, the global meltdown has also hit the textile industry.

In the Punjab circle, the CCI has purchased more than 36 lakh bales so far, including 16 lakh bales from Punjab, 12.25 lakh from Haryana and 7 lakh from Rajasthan, respectively.

The prices of cotton prevailed from Rs 2,700 to Rs 2,800 per quintal for Narma in Punjab and Haryana states while in Rajasthann it was sold for Rs 2,500 to Rs 2,650 per quintal.

According to information available with The Tribune, CCI has purchased more than 70 lakh bales so far in the country while Maharashtra federation and Nafed have purchased 26 lakh bales. The rest have been purchased by the millers. Nearly 200 lakh bales of cotton have arrived in the mandis so far.

According to D L Sharma, managing director Vardhaman Threads, the cotton prices in the international markets were higher compared with the prices prevailing in the Indian markets.

Sharma said the Indian textile mills would be able to meet with the requirements of cotton despite the estimated fall in the production. There was already 10 per cent drop in the consumption of cotton because of the global meltdown. The textile mills had already suffered losses due to the meltdown and a large number of labour had been rendered unemployed.

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RIL refused to sign gas sale pact with NTPC: Govt

New Delhi, February 20
The government today said Reliance Industries Ltd (RIL) had accepted the Letter of Intent (LoI) placed on it by NTPC for supplying gas to the power major's plants but refused to sign the Gas Sales and Purchase Agreement agreed upon.

Reliance had in 2004 offered a delivered price of $2.97 per million British thermal unit for about 3 million tonnes of gas a year from its eastern offshore fields to NTPC's power plants in Gujarat.

This was the lowest quote NTPC got in its global tender and it placed an LoI with RIL, Minister of State for Power Jairam Ramesh told the Lok Sabha today.

"The LoI was issued to Reliance on June 16, 2004, which was duly acknowledged and confirmed by Reliance," he said in a written reply to a question. But subsequently, RIL did not come forward to sign the GSPA.

"After the issuance of the LoI, Reliance did not come forward to sign the GSPA and sought major changes in the agreed draft of GSPA," Ramesh said.

"NTPC pursued (the matter) with Reliance at various levels and at various meetings to sign the GSPA, as per the draft accepted by Reliance during the bidding process.

However, in spite of all the efforts, Reliance did not sign the GSPA agreed during the bidding process," he added.

NTPC had invited global bids for sourcing 132 trillion Btu of gas per annum for its Kawas-II and Gandhar-II power projects for 17 years.

"Reliance was evaluated as the lowest techno-commercially acceptable bidder and NTPC accepted its offer," Ramesh said.

After failed attempts by NTPC to pursue Reliance for signing the GSPA at various fora, the former filed a suit at the Bombay High Court on December 20, 2005, against Reliance on the issue of meeting the terms of the contract. "The case is subjudice," he said. — PTI

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Telcos asked to put security code in place by March 31
Tribune News Service

New Delhi, February 20
The government has decided to give the cellular service providers more time to set in place the equipment required to bar calls from mobile phones that do not have the International Mobile Equipment Identity (IMEI) - a unique 15-digit identity code for mobile handsets.

Minister of State for Communications and IT Jyotiraditya Scindia said in a written reply in the Rajya Sabha yesterday that the telecom companies had been given time till March 31 to set this code in place.

IMEI helps the authorities identify the handset used to make a call on the GSM network, while the electronic serial number (ESN) is used for the CDMA network.

In a reply to a question, the minister said, "Government had directed on October 6, 2008 all access service providers to make provision of equipment identification register (EIR) in their networks, so that calls without IMEI, ESN or that with IMEI/ESN with all zero are not processed and rejected".

He added that the mobile service providers had now been given time till March 31 to comply with the directive and have also been asked to submit their compliance report by April 15.

The directions came following home ministry’s orders to re-exercise the verification of SIMs and to rule out the use of mobile handsets without having proper IMEI or ESN numbers.

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IOL Chemicals to expand capacity
Tribune News Service

Chandigarh, February 20
Ludhiana-based IOL Chemicals and Pharmaceuticals Limited will invest Rs 216 crore towards capacity expansion for its various product lines, including its most successful pharma product Ibuprofen.

The funds will also be used for forward and backward integration and increase in co-generation of power. The production capacity of Ibuprofen has been the stronghold of the company’s pharmaceutical operations and the company has recently boosted its Ibuprofen plant capacity to 3,600 TPA from 1,800 TPA.

An official release said the company aims to expand the capacity to 6,000 TPA to cater to the new geographical markets abroad, including Japan, Korea, Taiwan and few states of the USA as it has received coveted certifications for exports of Ibuprofen to various countries.

R K Thukral, executive director of the company, said as part of its backward integration plan, the company is going to commence a new plant of isobutyl benzene having annual capacity of 6,000 MT to ensure ready availability of the most important raw material of Ibuprofen. The production in this plant is expected to commence in next quarter.

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Nath rules out change in FDI policy

New Delhi, February 20
Unfazed by criticism over allowing "backdoor" entry to foreign investment in sectors like retail, the government today ruled out review of the new FDI policy that keeps indirect FDI out of sectoral caps.

"There is no question of review. If something is not understood, there will be clarification... Anybody who has doubt can get clarification," Commerce and Industry Minister Kamal Nath told reporters on the sidelines of an India-New Zealand bilateral meet here.

On the eve of the current session of Parliament, the Cabinet Committee on Economic Affairs approved some far-reaching changes in the FDI guidelines.

As per the new norms, foreign investment in a company, "owned and controlled" by an Indian, would not be counted as FDI. This means,a minority FDI in a domestic firm would not be taken into account when it makes investment into a subsidiary firm that in turn has a joint venture with a foreign company.

By implication, FDI component in the parent domestic firm would not be subject to the sectoral caps, thus giving leeway to overseas firms in sectors like telecom. The policy does not prohibit FDI into retail either. At present, FDI in multibrand retail is not permitted.

The Left parties have blamed the government for allowing "backdoor entry" to FDI into sectors kept outside the overseas investment. — PTI

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BRIEFLY

Airtel ups stake in Bharti Hexacom to 70 pc
Mumbai:
Private telecom service provider Bharti Airtel on Friday said it has hiked its stake in Bharti Hexacom to 70 per cent by acquiring 1.1 per cent from a Kuwait-based firm. Bharti Airtel has informed the BSE that the company has acquired 1.11 per cent stake, or 2,780,306 equity shares, in Bharti Hexacom Ltd from Mobile Telecommunications Co, KSC, Kuwait. — PTI

Oil falls in Asia
Singapore:
Oil prices fell in Asian trade on Friday in a market plagued by weak demand despite a sharp price rebound the day before, analysts said. New York's main futures contract, light sweet crude for delivery in March, fell 78 cents to $38.70 a barrel. Brent North Sea crude for April delivery shed 43 cents to $41.56.— AFP

Idea tariff plan
Chandigarh:
Idea Cellular has launched a new tariff plan offering reduced call charges, and more value for its subscribers in Punjab. The ‘IDEA Jumbo’ plan offers a flat call rate of just 50 paise per minute anywhere in India. Idea post-paid subscribers availing the Jumbo offer can now make local and STD calls on any network for just 50 paise per minute. Jumbo pack also offers reduced roaming incoming charges at 50 paise per minute. — TNS

Citibank launch
Mumbai:
Citibank on Friday launched Citibank Platinum Select Credit Card that offers a set of special offerings to customers. The card carries a best-in-class rewards program with superior earn rates, low interest rates, a service platform dedicated to members and enhanced fraud covers, a Citibank release said here. The card will be initially launched in New Delhi and Mumbai and will carry an annual fee of Rs 4,000, it said. — PTI

Amartex Shoppers World
Chandigarh:
Amartex Industries opened its 80th Amartex Shoppers World at Bathinda on Friday. The outlet was inaugurated by Varun Grover, director, Amartex Industries. — TNS

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