 |
| Tuesday, February 27, 2001, Chandigarh, India   
|
Punjab to try cement roads
Delhi Govt prepares to privatise power board UTI petition on tax payment adjourned
Industry calls rail Budget inflationary WTO meet reviews India’s
proposals on agriculture |
|
|||||||||||||||||||||||||||||
|
Vardhman Polytex to post lower
net Ashok Leyland, Telco sales
fall Bharti plans long-distance operations
|
|
Punjab to try cement roads Bathinda, February 26 Mr Suresh Neotia, Chairman, Ambuja Cement, said that the Bathinda plant will supply cement to south Punjab. About Rs 300 crore will be spent on the plant which will be completed in three stages. Eleven truckloads of cement produced at the local plant had been given to various social, educational and religious institutions free of cost, he said. The plant will check the menace of fly ash being produced by the local Guru Nanak Dev Thermal Plant. The clinker required for making the cement will be brought from Rajasthan. Mr Sukhbir Singh Badal, MP, Mr Chiranji Lal Garg, Mr Sikander Singh (ministers), Mr Makhan Singh and Mr Balbir Singh, all MLAs, and Mr Gurpreet Singh Kangar, member, Zila Parishad, were also present. Later talking to TNS Mr Neotia said the centre should implement those schemes announced by it in the previous years to bring the cement industry out of crises due to a decline in demand. He said at present there was a surplus of 20 million MT of cement in the country and the industry would continue to face crises till the Centre took steps to boost it. At a pre-Budget meeting with Finance Minister Yashwant Sinha representatives of Indian cement industry had urged him to take effective steps to create more demand of cement. The government had promised to implement the quadrilateral road project worth Rs 54,000 crore which was yet to take off. Apart from it, the government would also have to use cement for roads. Though the cost of cement roads was a little bit higher but it was beneficial as its life was about 30 years as compared to the life of bitumen. He said that cement industrial houses were also urging the state governments to shift to cement-based rural link roads from the bitumen as they would prove cost-effective and require less repair. He pointed out that the Finance Minister had also been urged not to disturb the existing system of levying of Central excise on the cement manufacturing. A shift from leavying of excise from production to value would create various problems for the smooth functioning of the industries. At present the cement industry was second highest payer of Central excise after the tobacco industry in the country. The total Central excise it was paying was about Rs 3500 crore. Regarding the threat to the domestic cement industry from the foreign-based companies, Neotia said it was up to the government to take steps in this connection. The prices of cement should be decided by traders and consumers at the grassroot level and not by the industrialists who were trying to establish their monopoly over the trade. He hoped that consumption in Punjab would increase from existing 4.25 million tonnes to six million tonnes in the coming two years and if it happened, the capacity of Ropar and the local plant would be doubled. To a question, he said that taking the rate of power units, coal and transportation into consideration, the hike in the cement rates in the past few months was not “unjustified”. He added that Ambuja Cement was trying its level best to control the cost of input by becoming more competitive so that consumers could get the cement at affordable prices. He disclosed that combined capacity of all the units being run by Ambuja was about 9 million tonnes per annum and its market share in the country was also about 9 per cent. He added that total capacity of cement production in the country was about 132 million tonnes. He warned that the foreign based companies which had started taking over the existing cement units were posing a great threat to the domestic industry on other account also as capacity of one such company was more than the capacity of all the companies of the country. He said that if the foreign based companies were willing to do business in India, they should set up new plants instead of taking over the existing plants. Mr Neotia claimed that the company had no plans to tie up with any multinational company to set up a new cement unit.
|
|
Delhi Govt prepares to privatise power board New Delhi, February 26 The government is carving up the Delhi Vidyut (Power) Board into one generation, one transmission and three distribution companies and aims to sell 51 per cent stakes in the distribution companies to the highest bidders. DVB's privatisation, expected to be completed later this year, is expected to reduce the city's frequent black outs and cut rampant power theft and improve metering. It is estimated the utility is paid for only about half the electricity consumed. Although it operates in the red, it is still considered an attractive investment opportunity in India's power distribution industry. That's because Delhi's citizens are the second richest in India, just behind Goa, offering the potential for rapidly increasing electricity consumption. Also, unlike most states where over 30 per cent of the power feeds agriculture demand, Delhi's agriculture load is less than one percent. Returns from the agriculture sector are usually poor, and the main reason for the large losses run up by most state power utilities. Delhi government officials also said DVB's large accumulated losses will not be passed on to the five successor companies but vested in a separate holding company. "Only some minimum serviceable liabilities will be passed on. The successor entities will start from a clean slate from day one," said officials who did not wish to be identified and would not divulge the amount of the accumulated losses. They said Delhi was aiming to avoid the mistakes of other states which have attempted similar privatisations but burdened the new entities with heavy debts stemming from past losses. Several states, including Orissa, Haryana, Rajasthan and Andhra Pradesh are splitting and privatising their power utilities. Only Orissa has completed the process.
Tariff to be fixed
Officials said the decision to clean up balance sheets was one among several decisions taken to help make the distribution companies more attractive to prospective bidders. They said they had also applied to Delhi's Electricity Regulatory Commission to decide on a method for fixing tariffs for the next five years to give investor's a clear future regulatory environment, a key concern. The commission has the power to fix tariffs and issue licences to private companies for the transmission and distribution of electricity. The officials said the planned privatisation also had the support of the board's workers since the state government had agreed to fund pension obligations totaling nearly Rs 4 billion ($86 million). Earlier this month, the government invited prospective corporate buyers with a net worth of 50 billion rupees and revenues of 100 billion rupees in the previous year to submit applications. They said they set no other qualifying criteria since they thought Delhi's power losses could be reduced by strong administrative and managerial action. Officials said they had assumed that private firms would be able to reduce the huge transmission and distribution (T&D) losses by 12 to 13 per cent over the next five years. They could improve profits if they surpassed those distribution efficiency targets. A one percent reduction in T&D losses will increase revenues by about Rs 800 million, they said. The Delhi Vidyut Board is projected to post Rs 49.859 billion in revenue in the new year beginning in April. It had a peak load of 2,600 MW of power in 1999/00.
Reuters
UTI petition on tax payment adjourned Mumbai,
February 26 The petition was adjourned by Justices S.H. Kapadia and V.C. Daga as the Income Tax Department’s counsel Rafiq Dada sought time to put forth his argument. UTI has contended that it was set up under a special statute. It was a mutual funds organisation and therefore not subject to regulations of SEBI. It had no assets and liabilities of its
own. The money contributed by unit holders was invested in schemes and returns therefrom were distributed in respective proportions. UTI resembled a trust but it was not a trust. Whatever tax liability arose as a result of its
schemes, was to be met by the unit holders. In short, UTI was a collective corpus of various investors and not a corporate body, it said. UTI submitted that Section 32 of the Unit Trust of India Act 1963 provided that it was not liable to pay any tax in respect of any incomes, profits or gains derived from any source. Interest earned by UTI was in fact income
earned. When it was exempted from paying tax on income how could UTI be held liable to pay tax on interest which is treated as an income, the petition argued.
PTI |
|
Industry calls rail Budget inflationary New Delhi, February 26 President of FICCI Chirayu R. Amin said the Railway Budget should review its entire policy to attract larger freight
traffic. The essential element of this exercise should be to review subsidisation of passenger traffic and not resort to only raising the freight rates continuously. The rail freight rates are already too high and the present hike, though marginal, is not welcome. The 2 per cent increase in freight rates for coal and iron and steel is bound to impact growth in major sectors of economy. President of Assocham Raghu Mody said yet another opportunity of carrying out fundamental reforms, rationalisation of tariff and commercialisation of the idle properties has been lost. Mr Mody said the 3 per cent hike in the freight rates may have a cascading effect in the cost of production, leading to cost-push inflation which could have been avoided by the Railway Minister through rationalisation of passenger fares which are being subsidised considerably. Mr Arun Bharat Ram, President, CII, said the Railway Budget had bypassed the second generation of reforms. Against the backdrop of poor financial health, the minister should have taken bold measures to put the railway finance on track. President of the PHDCCI Sushil Ansal said the proposed 3 per cent increase in freight rates will rise inflation which is already hovering around 9 per cent. The increase in freight hike will also add to cross-subsidisation of passenger services and further reduce the Railway’s share in the transportation sector adversely affecting railway earnings in the long run.
|
|
WTO meet reviews India’s proposals on agriculture New Delhi, February 26 Raising livelihood concerns at the ongoing review meetings on Agreements on Agriculture (AoA) at the WTO headquarters, Geneva, India also suggested that some specific measures under a “Food Security Box’’ should be allowed for developing countries. The main elements of the Indian proposal are: — Additional flexibility for providing subsidies to key inputs for agriculture and rural development. — Linking of appropriate levels of tariffs in developing countries with trade distortions in the areas of market access, domestic support and export competition. — Rationalisation of low tariff bindings in developing countries which were not properly negotiated earlier. — There should be no minimum market access commitment for developing countries. — Measures taken by developing countries for alleviation of poverty, rural development and employment and diversification of agriculture should be exempted from any reduction commitments. — Primary products like rubber, jute and coir should also be included in the AoA. — Product-specific support given to low income and resource poor farmers should be excluded from aggregate measure of support. — There should be sustained reduction in tariff binding, including elimination of peak tariffs and tariff escalations in developed countries. — There should be expansion and transparent administration of tariff rate quota(TRQs) pending their eventual elimination. — Blue box measures, de-coupled and direct payments as well as government financial participation in income insurance and income safety programmes in Green Box should be included in the Amber Box which is subjected to reduction commitments. — Elimination of export subsidies, export credits, export insurance and export guarantees. — Abolition of peace clause for developed countries. India’s stand has received overwhelming support from developing countries. In the second week of February, WTO members met informally, ahead of the March 26-28 meeting on agriculture negotiations, to discuss the next phase of talks which is likely to discuss in-depth the proposals tabled by various countries. The review of India’s proposals will continue till March 22-23.
UNI
|
|
Vardhman Polytex to post lower
net Chandigarh, February 26 VPL manufactures 100% cotton yarn, 100% acrylic yarn and polyester cotton blended
yarns. The company, based at Ludhiana has 5 manufacturing units located in Punjab and Himachal Pradesh. VPL is part of Rs 1,650-crore Vardhman group, which is fully, integrated into manufacturing of a wide range of products — yarn, sewing thread, and fabric. The Vardhman group has established itself as a strong player in the textile sector, showing consistent growth in sales and profitability, both in the domestic as well as international market. The operating incime of VPL has grown from Rs 223.5 crore in FY00 from Rs. 211.7 crore in FY99 —growth of 5.6%. A large portion of the growth has emanated from a 19.3% growth in exports (from Rs 54.22 crore) in FY99 to Rs 64.69 crore in FY00). The performance of VPL improved considerably in FY00 over FY99 levels as a result of 10.7% decline in average cotton cost. The operating margins improved from 15.9% in FY99 to 18.1% in FY00. However return on capital employed remained moderate at 12.5% over the last two years. The gearing for the company increased from 0.91 times in FY99 to 1.01 times in FY00. VPL has undertaken significant capital expenditure towards modernisation and expansion of capacities in FY00 and these investments have been mostly funded by term loans from Fls under TUF scheme. VPL registered a growth of 37% in profit after tax, from Rs 12.53 crore in FY99 to Rs 17.19 crore in FY00. Overall inventory levels have come down and the short-term liquidity position of VPL is comfortable, which is corroborated by substantial unutilised bank limits. ICRA expects VPL’s sales to increase from addition of new capacities, however, increase in raw cotton prices is expected to impact the operating margins. The net profits are expected to decline during FY01 and FY02 due to higher depreciation charges and interest burden. In the short term, due to increase in cotton prices and depressed export realisations the profitability of the entire cotton yarn spinning industry is expected to be adversely affected. ICRA draws comfort from the financial flexibility available to the company both from the group and access to long term funds from banks.
Ashok Leyland, Telco sales fall New Delhi, February 26 Total sales declined to 1.15 lakh units during April-January 2000-01 from 1.31 lakh units sold a year-ago period, according to figures compiled by the Society of Indian Automobile Manufacturers (SIAM). The medium and heavy (M&H) vehicles segment, which comprised 57.2 per cent of the total sales, witnessed a 23 per cent drop at 65,874 units as against 85,635 units sold in the year-on-year period. Telco sold 41,646 units in the M&H segment down 28 per cent, over 57,706 units sold in the first 10 months of the previous fiscal. A senior Telco official had earlier predicted that it would experience flat commercial vehicles sales growth in the fiscal ended March 31, 2001, due to a drop in sales of medium commercial vehicles. Ashok Leyland’s M&H vehicles sales stood at 24,132 units during April-January 2000-01, down 13.2 per cent, over 27,809 units sold in the previous fiscal. Hindustan Motors also recorded a 20 per cent dip in sales at 96 units over 120 units sold in the year-on-year period. However, sales of light commercial vehicles (LVCs) registered a modest 7.5 per cent growth at 49,195 units during April-January 2000-01 over 45,737 vehicles sold in the corresponding period last year. Telco, which witnessed a drop in sales in M&H segment, posted a 9 per cent growth selling 30,848 vehicles compared to 28,337 units sold in the year-on-year period. Sales of Swaraj Mazda increased by 35.3 per cent to 4,021 vehicles from 2,971 units sold in the first 10 months of the previous fiscal.
PTI
Bharti plans long-distance operations New Delhi, February 26 “Bharti SingTel will need Rs 5,000 crore in four years for this venture,’’ CEO of Bharti Enterprises, Sunil Bharti Mittal, today said. Mr Mittal said 2,000 to 3,000 crore will be tapped through debt while the company has cash reserves of Rs 600 crore. The rest could be raised from private equity, Mr Mittal said. He said lowering the tariffs has spurred competition in the mobile segment where GSM has a clear edge over the new CDMA technology. “Once CPP will be put in place GSM will edge out CDMA’’ Mr Mittal said. The company will also bid for cellular licences in 10 to 12 circles. “We expect to win the bidding process in five of the circles’’ he added. The company will launch new technologies like GPRS when they stabilise worldwide. The undersea venture with SingTel is on course. After monsoon “we would start laying the cables’’ from Chennai to Singapore. “Already the production of equipment is on’’. Bharti Enterprises and SingTel had announced plans to set up a $ 650-million undersea cable project linking Singapore and India.
UNI |
cr
Pak cuts GDP forecast to below 4 pc Rising rents lift HK Land earnings China’s GDP grows 7.7 per cent Glaxo promises cheap drugs for poor |
bb
Direct shipping OBC loan for Punjab SBP branch Amartex at Mandi SBI trophies Banking Bill |
 |
| Punjab | Haryana | Jammu & Kashmir | Himachal Pradesh | Regional Briefs | Nation | Editorial | | Business | Sport | World | Mailbag | In Spotlight | Chandigarh Tribune | Ludhiana Tribune 50 years of Independence | Tercentenary Celebrations | | 121 Years of Trust | Calendar | Weather | Archive | Subscribe | Suggestion | E-mail | |
