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Core sectors rebound 
Grow by 4.3 per cent in April

New Delhi, June 2
Displaying signs of economic recovery, the growth rate of core industries, including cement, finished steel, coal and electricity nearly doubled to 4.3 per cent during April, the first month of the current fiscal. The growth in the six core industries was 2.7 per cent in April-March 2008-09 as against 5.9 per cent in the previous fiscal.

Sharma rules out change in FDI policy 
New Delhi, June 2
Ruling out any "review" of the foreign direct investment (FDI) policy, Commerce and Industry Minister Anand Sharma has said there are in-built safeguards against FDI finding its way into multi-brand retail and breaching caps in broadcasting and defence production. Sharma, who took charge of the nodal ministry for FDI on May 29, said there was no need for a relook at the policy amended in February by the Department of Industrial Policy and Promotion (DIPP).



A model displays an Acer laptop running Google's Android operating system at Computex 2009 in Taipei on Tuesday. Acer Inc plans to sell netbook PCs that run on Google's Android operating system, posing a potential threat to Microsoft's Windows. — Reuters

EARLIER STORIES



A worker rides a bicycle at an assembly belt line at Opel's plant in Gliwice, some 350 km south of Warsaw
A worker rides a bicycle at an assembly belt line at Opel's plant in Gliwice, some 350 km south of Warsaw, on Tuesday. Germany will start providing financing to Opel on Tuesday and is no longer relying on Canadian auto parts group Magna to cover the carmaker's short-term liquidity needs, Finance Minister Peer Steinbrueck said. — Reuters


Gold granules are displayed in the Austrian Gold and Silver Separating Plant Oegussa in Vienna on Tuesday. Gold edged higher in Europe on Tuesday, recovering from earlier losses, as dealers remained wary about the outlook for the dollar which hit its lowest level this year in the last session. — Reuters

GM facing problems to raise funds in India
New Delhi, June 2
Bankrupt General Motors today said it was facing difficulties in raising funds for its under-construction engine transmission plant in India, involving an investment of $200 million, due to the apprehensions of financial institutions.

Finds buyer for Hummer

Exporters demand high-level probe 
Chandigarh, June 2
Rice exporters are up in arms against the government for the alleged lapses and irregularities in the export of non-basmati rice to under-developed countries. Alleging that a chosen few have been favoured, in what is actually supposed to be government-to-government exports, the exporters have demanded a high-level probe in these export deals with some African countries.

10 new SEZs cleared
New Delhi, June 2
The government today approved 10 special economic zones and allowed one-year extension to four projects, including Reliance Industries' Mukesh Ambani- promoted Rewas Ports for land acquisition.

JSW defers Rs 35,000-cr WB project 
New Delhi, June 2
After cutting investment in the first phase of the its ambitious 10-MTPA West Bengal project by almost a third, JSW Steel today said the commencement of construction work at the site of the mega steel plant will now be deferred on account of the current "economic situation." "There is a slight deferral for some time (on the commencement of construction work) till the economic situation improves," JSW Steel vice-chairman and MD Sajjan Jindal told reporters on the sidelines of an Assocham conference here.

LSE trades stocks worth Rs 700 crore daily
Ludhiana, June 2
The recession may have hit the global industry, but as far as stock market in Ludhiana is concerned, a whopping trade worth Rs 600-700 crore is being done here, through the NSE and the BSE, on a daily basis.

MFs’ assets cross Rs 6 lakh-cr mark 
New Delhi, June 2
The mutual fund industry crossed a record Rs six lakh crore-mark in assets in May, with the country's largest fund house, Reliance MF, alone accounting for over Rs 1 lakh crore.





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Core sectors rebound 
Grow by 4.3 per cent in April
Tribune News Service

New Delhi, June 2
Displaying signs of economic recovery, the growth rate of core industries, including cement, finished steel, coal and electricity nearly doubled to 4.3 per cent during April, the first month of the current fiscal.

The growth in the six core industries was 2.7 per cent in April-March 2008-09 as against 5.9 per cent in the previous fiscal.

Crude oil production continued to remain in the negative zone as it dipped by 3.1 per cent in April while it had registered a growth rate of 1 per cent a year ago. Production of petroleum refinery products dipped by 4.3 per cent in April.

Finished steel posted a growth rate of 1.6 per cent in the first month of the fiscal 2009-10 against a negative growth rate of 0.6 per cent a year ago.

Cement production increased to 11.7 per cent in April against 6.9 per cent a year ago.

Coal production increased by 13.2 per cent against 10.4 per cent in April 2008.

Similarly, electricity generation increased by 6 per cent in April against 1.4 per cent in the same month last year.

PTI adds: "We are on path to recovery. We are climbing out in the last three months. April figures are very encouraging ... but we are still in the recovery stage," said Saumitra Chaudhuri, member of the PM's Economic Advisory Council.

Driven by robust performance of key sectors, the output of six core sectors, which has over 26 per cent weight in the Index of Industrial Production (IIP) rose by 4.3 per cent during the month compared to 2.3 per cent in April 2008.

The news of smart recovery in performance of the core sector comes within days of the government data revealing that India recorded 6.7 per cent GDP growth rate during 2007-08, despite the impact of the global crisis.

Though recovery was noticed in coal, cement, electricity and steel, the petroleum sector output fell during the month in the backdrop of declining production of crude oil as well as refinery products.

Commenting on the core sector's performance during April, Planning Commission Member Anwarul Hoda said, "We seem to be going out of economic slowdown. The main thing to be watched is how soon the world economy comes out of the recession..." As regards 1.6 per cent growth in the finished output of steel, PMEAC member Chaudhuri said, "Growth in steel compared to the second half of the last year is good. This is a passing phase and some improvement is still needed." 

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Sharma rules out change in FDI policy 

New Delhi, June 2
Ruling out any "review" of the foreign direct investment (FDI) policy, Commerce and Industry Minister Anand Sharma has said there are in-built safeguards against FDI finding its way into multi-brand retail and breaching caps in broadcasting and defence production.

Sharma, who took charge of the nodal ministry for FDI on May 29, said there was no need for a relook at the policy amended in February by the Department of Industrial Policy and Promotion (DIPP).

"At this stage, we don't see that the time has come for any comprehensive review ... it is too early in the day ... we will see how the new policy is working," Sharma told PTI in an interview.

There are safeguards against FDI in sensitive sectors like broadcasting and defence production, while the policy does not allow overseas investment in retail, he said. The "misunderstanding" on FDI being allowed indirectly in multi-brand retail "is not well placed at all", he said.

He said there were "effective, inbuilt safeguards when it comes to the sectoral caps, particularly in those sectors which have been sensitive, and (going) by the new policy those areas remain protected ..." While the policy does not allow overseas inflow into this sector, the changes in February were perceived to be opening the sector to FDI up to 49 per cent in an Indian firm that has a downstream subsidiary firm in retailing.

As India does not allow FDI into multi-brand retail, mega US stores like the Wal-Mart can enter the country only for wholesale trading known as 'Cash and Carry'.

On the other hand, overseas investment in sensitive areas of defence production and print media is permitted up to 26 per cent.

Referring to the sharpest-ever dip in exports in the last 14 years, the Commerce and Industry Minister said he is concerned over the over 33 per cent shrinkage in overseas shipments.

He expressed hope that the country would be able to return to the high-growth trajectory. — PTI

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GM facing problems to raise funds in India

New Delhi, June 2
Bankrupt General Motors today said it was facing difficulties in raising funds for its under-construction engine transmission plant in India, involving an investment of $200 million, due to the apprehensions of financial institutions.

The company also said the falling sales of General Motors India, the wholly-owned subsidiary of the US firm, were mainly due to customers' perception on the months-long uncertainty over the future of GM, which finally filed for bankruptcy protection in a New York Court yesterday.

"It hasn't been easy in India to raise the money ($200 million). Frankly, we have found difficulties from Indian financial institutions, but we have not given up," GM group vice-president Nick Reilly told reporters in a conference call.

"The majority of the fund remains to be raised. It might take us little longer, but the opening of the plant is largely on schedule. It may be delayed by a month or two," he added.

Reilly also said the company's sales in the past couple of months had been declining in India on account of "customers' perceptions" in view of the uncertainty prevailing in the US market over the parent company's fate.

"We have seen some decline (in sales) in the Indian market in the past few months, obviously the market is weak.

But mainly, I think, it was because of customers' response due to widespread coverage on what was happening in the US," Reilly added.

According to Society of Indian Automobile Manufacturers data, GM India's sales showed a constant fall in the first four months of 2009, by 29.18 per cent, 12.64 per cent, 27.25 per cent and 13.67 per cent, respectively.

GM India's sales in May was down 11.75 per cent at 5,109 units from 5,789 units in the year-ago period.

In August last year, GM India had announced setting up of a power-train facility at Talegaon with an initial investment of over $200 million, which was in addition to the $300 million already invested in the car manufacturing facility having a capacity of 1.4 lakh units. — PTI

Finds buyer for Hummer

New York: Beleaguered auto maker General Motors today said it has reached a tentative deal with a buyer for the sale of its famed Hummer brand, which could save as many as 3,000 jobs in the US.

The announcement comes a day after the iconic car maker filed for bankruptcy protection, being bogged down by huge losses and plunging sales in recent months.

Without revealing the identity of the buyer, General Motors said it has entered into a "memorandum of understanding (MoU) with a buyer for Hummer, its premium off-road brand". General Motors in a statement said the deal is anticipated to secure more than 3,000 US jobs in manufacturing, engineering and at Hummer dealerships around the country.

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Exporters demand high-level probe 
Ruchika M. Khanna
Tribune News Service

Chandigarh, June 2
Rice exporters are up in arms against the government for the alleged lapses and irregularities in the export of non-basmati rice to under-developed countries. Alleging that a chosen few have been favoured, in what is actually supposed to be government-to-government exports, the exporters have demanded a high-level probe in these export deals with some African countries.

The rice exporters alleged that the government was itself facilitating exports by private parties as the parastatals — State Trading Corporation (STC), Minerals and Metals Trading Corporation (MMTC) and PEC were nominating private traders to export rice shipments, without adopting a transparent policy for selecting traders. They also alleged that these deals, wherein the consignees were actually not the under-developed countries, but private commodity traders based in Switzerland, could not have been executed without the support of the political powers that be. These irregularities in the exports of non-basmati rice have been highlighted by The Tribune today.

Vijay Setia, president of All-India Rice Exporters Association and a leading rice exporter from Karnal, said the government should initiate a probe in all dealings. “The former foreign minister of Republic of Ghana is being probed by his country’s premier investigating agency for using state machinery for rice exports from India and then sharing these shipments with private traders. The Indian government, too, should order a probe and fix responsibility on those who have been aiding the traders to export privately, though on paper these are supposed to be government-to-government deals,” he said.

Rice exporters also said the government had allowed rice with minimum 25 per cent brokens to be exported. “This rice with 25 per cent brokens is meant for poor people and should not be exported, rather used for various welfare programmes. On the other hand, there are no buyers for the super fine varieties of rice in the domestic market and it is being sold at prices below the minimum support price. But this super fine rice is not being exported. By selectively allowing exports through these so-called diplomatic channels, the government is enabling a few firms to derivate arbitrage benefits as the rice being exported from India through this government-to-government route is cheaper than the existing international prices,” said Sushil Jain, managing director of Veer Overseas Ltd.

Demanding a level-playing field for all exporters, Gurnam Arora, joint managing director of Kohinoor Foods, said the country had enough rice stocks and the ban on exports of non-basmati rice must be lifted. “Instead of choosing a select few, everyone should be allowed to export.”

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10 new SEZs cleared

New Delhi, June 2
The government today approved 10 special economic zones and allowed one-year extension to four projects, including Reliance Industries' Mukesh Ambani- promoted Rewas Ports for land acquisition.

The Board of Approval (BoA) in the Commerce Ministry gave formal approvals to eight proposals, including those of Gulf Oil Corporation, Emmar MGF and Larsen and Toubro. Two other proposals were also given 'in-principle' approvals.

The board also allowed DLF to withdraw four of its IT/ITeS tax-free enclaves, asking the realty major to refund Rs 6-7 crore worth of fiscal sops the company would have availed of. DLF had cited economic downturn as reasons for seeking withdrawal.

Four developers, including Ambani-promoted Rewas Ports in Raigad, Maharashtra, and K Raheja group have been allowed extension of in-principle approval by one year. These projects have not been able to acquire the required land.

However, the BoA outrightly rejected the proposals of Videocon Realty and Writers and Publishers for SEZs in Indore, on the ground that the promoters have not acquired "even an inch" of land.

"We want serious players and don't (want) to spoil the SEZ policy," Additional Secretary in the Commerce Ministry D K Mittal said after the BoA meeting.

"The total investment expected from these approved SEZs would be about Rs 1,000 crore," Mittal told reporters.

K Raheja has proposed to develop tax free zones in Goa, Hyderabad and Navi Mumbai.

The two proposals that have got in-principal approval includes - Krishnapatnam Infratech in Kota Mandal (Andhra Pradesh) and Maharaja Multitrade in Nashik (Maharashtra) for multi-product and multi-services SEZs respectively.

In today's BoA meeting, 18 proposals was considered.

Since 2006, when the SEZ Act was notified, formal approvals have been granted for setting up 568 SEZs, of which 315 have been notified. — PTI

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JSW defers Rs 35,000-cr WB project 

New Delhi, June 2
After cutting investment in the first phase of the its ambitious 10-MTPA West Bengal project by almost a third, JSW Steel today said the commencement of construction work at the site of the mega steel plant will now be deferred on account of the current "economic situation." "There is a slight deferral for some time (on the commencement of construction work) till the economic situation improves," JSW Steel vice-chairman and MD Sajjan Jindal told reporters on the sidelines of an Assocham conference here.

Construction work at the site of the steel project in Salboni, West Bengal was scheduled to start in March next year, but is likely to be delayed by 6-8 months.

Faced with a liquidity crunch JSW Steel has earlier this year said that it is cutting its proposed investment by nearly one-third to about Rs 4,000 crore for the first phase of the Rs 35,000-crore mega steel project in West Bengal.

In November last year, the company had laid the foundation stone for the project and said the first phase with three million tonne capacity would come up at the cost of Rs 10,000-12,000 crore. — PTI

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LSE trades stocks worth Rs 700 crore daily
Shivani Bhakoo
Tribune News Service

Ludhiana, June 2
The recession may have hit the global industry, but as far as stock market in Ludhiana is concerned, a whopping trade worth Rs 600-700 crore is being done here, through the NSE and the BSE, on a daily basis.

Leaving aside the BSE, the Ludhiana Stock Exchange Securities Ltd remain on top amongst other 23 exchanges in the country. For boosting the trade even more, the LSE is busy negotiating with the Multi Commodity Exchange of India (MCX) to provide an independent trading platform in the region.

According to experts, if the deal is finalised, small and medium scale industries, too, will get a boost. At present, the Ludhiana Stock Exchange is a subsidiary working through LSE Securities Limited with a total of 300 listed members. Out of these, about 160 members are active.

Perhaps this is the reason that the ticket of the stock exchange, which was sold at a meagre price of Rs 2,000 in 1983-84, was now available at Rs 12 lakh. On an average, stock trading with Rs 95,000 crore to Rs 1 lakh crore was being done in the country in a single day and Ludhiana pools its share of about Rs 600-700 crore daily to the stock markets.

Prof Padam Parkash Kansal, vice-chairman, LSE Securities, said efforts were on for the revival of an independent Ludhiana Stock Exchange. He told The Tribune that initial stages with the MCX had been cleared. If the deal was matured, MCX would buy 15 per cent shares of the LSE and latter, too, will have to buy the same percentage of shares from MCX.

"Even if the deal fails to get matured, we will try to work independently as we fulfil the SEBI guidelines. As per SEBI rules, rights of trading are given to the exchange worth Rs 100 crore. But we, the LSE Securities is worth Rs 300 crore and above. LSE Securities has an upgraded status as trading is being done through two big players (NSE and BSE) in the market. The business in LSE Securities has always seen an increase, even at the time when global recession has hit the world", claimed Kansal.

He further added that investors, currently were interested in few listed companies. If LSE gets an independent platform, more medium and small scale industries will enter the market, providing ample opportunities to investors.

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MFs’ assets cross Rs 6 lakh-cr mark 

New Delhi, June 2
The mutual fund industry crossed a record Rs six lakh crore-mark in assets in May, with the country's largest fund house, Reliance MF, alone accounting for over Rs 1 lakh crore.

The mutual fund industry's average assets under management (AUM) grew by Rs 86,355.19 crore, or 15.66 per cent, and analysts said the increased inflows into fund houses show that investors are regaining confidence in equity schemes.

The combined average AUM of the 35 fund houses in the country increased to Rs 6,37,609.41 crore in May compared to Rs 5,51,25,422 crore in April, according to the data released by the Association of Mutual Funds in India (AMFI).

Reliance MF maintained its top position as the largest fund house in the country with Rs 14,342.17 crore or 13 per cent jump in AUM to Rs 1,02,730.16 crore at May-end. It had an AUM of Rs 88.387.98 crore at the end of April.

The second-largest fund house, HDFC MF, gained Rs 11,525.47 crore in its AUM at Rs 75,406.10 crore.

"The market has gone up substantially and the investors are also showing interest in equity schemes. With increased inflows, the subscription is also increasing," Sahara Mutual Fund CEO Naresh Garg said.

ICICI Prudential and state-run UTI MF added Rs 9,500.58 crore and Rs 8,947.88 crore, respectively, to their assets last month.

ICICI Prudential's AUM stood at Rs 65,549.86 crore at the end of May, while UTI MF had assets worth Rs 63,437.87 crore.

"Investors are now waiting for some kind of reforms in the upcoming budget. Any further gains in AUMs would depend on the speed of reforms," Garg said. — PTI

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BRIEFLY

MTNL’s pre-paid 3G services
New Delhi:
The state-run MTNL today introduced a pre-paid option for this service at just Rs 300. Announcing the launch of the pre-paid 3G services, MTNL chief R S P Sinha said, "MTNL is launching 3G Jadoo pre-paid services so that customer should be able to avail the latest 3G/3.5G services at an affordable price". The MTNL had introduced the 3G Jadoo services in Delhi in December and in Mumbai last month. 3G services will be available for only Rs 300 with lifetime validity. — TNS

SBI to raise Rs 28,000 cr
New Delhi:
The country's largest lender, State Bank of India on Tuesday said it could raise Rs 28,000 crore from bonds to meet regulatory capital requirement and to fund business growth during the current fiscal. "We have enough cushion. Around Rs 28,000 crore headroom is available for raising subordinated bonds as and when required," a top SBI official said. — PTI

HPCL Q4 net jumps 13-fold
New Delhi:
Hindustan Petroleum Corporation on Tuesday reported a 13-fold growth in net profit at Rs 5,104.04 crore for the fourth quarter ended March 31, 2009. The total income of the company declined 16.91 per cent to Rs 24,875.02 crore during the fourth quarter, from Rs 29,936.03 crore in the corresponding period a year-ago. The board has declared a dividend of 52.5 per cent at the rate of Rs 5.25 a piece on every share of Rs 10 each held for the financial year ended March 31.— PTI

Oil India IPO likely by Sept
New Delhi:
Oil India Ltd is likely to launch an initial public offering (IPO) by September this year, company chairman N M Borah said on Tuesday. The company has initiated discussions with its IPO adviser's to decide on the timing. "Stock markets are reviving and so we have started dialogues again with advisers for the IPO," he told reporters here.— PTI

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