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April 2, 2001, Chandigarh, India   
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Gate not opened to exotic pests
Exports may touch $43 billion mark Disliked
at work? LSE investors lose Rs 5,000 cr |
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FIIs’ inflow at 1,973 cr in March Power play in Haryana-1 Pepsi lifts yields & hopes JK Cement earns profit Q: My father built a house in 1951 at a cost of Rs 18,000/-, which I have inherited. I want to sell it and seek the following clarifications for the amount so obtained. In what time period I will have to purchase a plot or build a new house from the date of sale to avoid capital gain tax? Can I invest the sale amount in two separate new houses to avoid capital gain tax? Can I invest the full amount (or the balance amount after purchase of a new house) in a bank or bonds to avoid capital gain tax. If so, within what period from the date of sale and in which bank or bonds and for how long. Please quote section. The sale amount will be around 56 lacs. What will be the amount of capital gain tax. Be cautious, have
patience or else... ‘Tehelka’ hits
process of AI, IA disinvestment
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Gate not opened to exotic pests New Delhi, April 1 Director General of Foreign Trade N.L. Lakhanpal, who played a key role in authoring the Export-Import Policy for 2001-2002, told UNI that every country used the “Import Risk Analysis” of the primary products.” This is totally allowed under the World Trade Organisation and we are the last country to use it”, Mr Lakhanpal said. Under the policy, it has been ensured that the import of agricultural products do not lead to unwanted infiltration of exotic diseases and pests in the country.” It has been decided to subject import of primary products of plant and animal origin to the ‘Bio security and sanitary and phyto-sanitary permit’ to be issued by the Department of Agriculture and Cooperation”, the DGFT said. The permit would be based on the Import Risk Analysis of the product to be conducted on scientific principles,in accordance with the WTO agreement on application of sanitary and phyto-sanitary measures. India has also put restrictions on import of about 600 items covered under 20 and 21 of the General Agreement on Trade and Tariff (GATT). The Article 20 is about restrictions on imports for protecting animal, plant and human life. The Article 21 relates to the national security and certain international treaties like the Treaty on Chemicals. “About 600 items under these Articles have already been notified and we are not the only country doing it. Almost all the countries have done so” Mr Lakhanpal said. However, there is no overlap between these 600 items and 715 items on which QRs have completely been removed from today. He gave the justification of checking import of agricultural commodities like wheat and rice through the state trading agencies, saying their domestic trade itself is not totally free. Regarding innocuous reasons cited for controlling the import of second-hand cars, the DGFT quipped: “I have enough garbage in my home; I do not want to add more”. The Exim Policy stipulates that the importable second-hand car should not be more than three-year old and the reason cited for this condition is road safety. Mr Lakhanpal was replying on a counter argument about how the government is allowing even 20-year-old vehicles to ply on the roads. As regards lifting of restrictions on import of foreign
liqour, the government would use effectively the tariff barriers. “We already have the bound rate of 210 per cent on foreign liquor. Besides, the state governments can put a counter-vailing duty to discourage imports”, Mr Lakhanpal said.
UNI
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Exports may touch $43 billion mark New Delhi, April 1 With Indian exports in the first 11 months of the just ended financial year rising by 20 per cent in dollar terms touching a record figure of $ 39.54 billion, it is expected that exports would touch the $43 billion mark. “With 20 per cent growth rate in the first 11 months, we need a growth rate of only 0.42 per cent in March, 2001, to achieve 18 per cent target growth rate for 2000-2001”, the Minister said. India would need to export $75 billion annually if we were to have 1 per cent share of the golbal trade, Mr Maran pointed out. In an exercise to allay popular apprehensions and to silence the opposition, Mr Maran said the actual data shows that India’s trade deficit has actually declined from $9602.25 million during April-February 1999-2000 to $5831.76 million in 11 months of fiscal 2000-2001. QRs on 714 tariff lines had
already been removed in last year’s Exim policy, the Minister said adding that the
growth rate of imports during April-February 2000-2001 at a little over 6 per cent was much lower than the record export growth rate of 20 per cent registered in dollar terms during this period. The latest monthly trade data released today said exports during February, 2001, stood at $3.76 billion as against $3.40 billion recorded in the same month last year. Despite a fall in export growth to 10.46 per cent in February, India has continued to maintain an over 20 per cent overall surge in the first 11 months of this financial year. India’s exports during April-February 2000-01 was $39.54 billion , up 20.03 per cent over $32.94 billion registered in the year-ago period, the data revealed. There was an improvement in the trade deficit which was recorded at $5.83 billion during April-February 2000-01 as against $9.60 billion.
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Disliked at work? London, April 1 2. Try to coax them into friendship in the usual low-key ways — helping them out, taking an interest in them and just being generally affable and telling jokes. If that does not work, you may be able to shrug off the issue: Gilbert and Sullivan, for example, were not great friends but still managed to produce some fantastic pieces of theatre. If, however, your work is going to suffer, you need to consider raising the issue. 3. Choose a quiet and private moment to broach the subject, suggests management consultant Terry Gillen. `The way you raise the subject is all important,’ he says. ‘Keep the focus on yourself.’ If you say ‘You don’t like me’ you are putting the focus on them in a way that will probably sound aggressive and elicit an unproductive response. If you say something like ‘I may have the wrong end of the stick, but I wonder if there is something I do that bothers you’ you are more likely to get a useful answer. ‘The trick is to probe,’ says Gillen. By asking questions like ‘Do I do that often?’ or ‘Tell me why that bothers you?’, you are more likely to get information you can act on. Try to listen without immediately jumping in to defend yourself. 4. Don’t let yourself be undermined if hostilities persist. `You need strong emotional support from friends and family,’ says Jo Bond of Right management consultancy. It is often the most considerate people who question their own judgment when subjected to bullying. Try to get the views of friends if your colleague continues to make life difficult. 5. Think carefully about raising the issue with your boss — perhaps only if your department’s work is being disturbed by the personality clash. Gillen says: ‘Most bosses don’t want to get involved in that sort of thing.’ You may end up feeling even more humiliated if you are just told to pull yourself together. So if you go to the boss, go as an adult with a suggested solution to the problem — rather than as a child wanting retribution for a playground spat.
By arrangement with The Observer
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LSE investors lose Rs 5,000 cr Ludhiana, March 31 The trading remained suspended at the LSE on Friday as the stock brokers had boycotted the trading operations which may continue on Monday. The brokers are protesting against the harassment of the brokers and illegal demand of the income tax officials to ‘surrender’, more income tax to help the department fulfil their target of Rs 293 crore tax collection in the Ludhiana region. The insiders say that the investors had already lost substantial amount in view of the fall in the share market prices at all the stock exchanges in the country. The index at LSE may fall further when it opens for trade. The investors have already burnt their finger in the Technology, Media and Telecommunications (TMT) shares and the current raids at the LSE may lead to payment crisis. The management of the LSE, however, claims that there is no cause to worry as they have about Rs 13 crore as Trade Guarantee Fund. Mr Tarvinder Dhingra, Vice President, LSE, agrees that the investors have lost substantially in the past few days. He says, ‘‘since January the stock prices have come down by about 70 per cent at the Bombay Stock Exchange and National Stock Exchange. We are no exception. All the investors especially those who had invested in TMT shares have lost substantially.” Mr
H. S. Sidhu, General Manager, LSE, disclosed that the market capitalisation of the companies in the LSE region is around Rs 30,000 crore and the number of investors is around 5 lakh. The investors had invested around Rs 10,000 crore in the TMT shares whose value have declined by 60-70 per cent since early
January. It has resulted in loss of more than Rs 5000 crore to the investors in the region. He said in Ludhiana alone about 10,000 investors have lost about Rs 100 crore in the past few days. There are about 100 active stock brokers at the LSE who work for about 100-125 investors on an average. The investments of these investors vary from Rs 25,000 to Rs 1 crore. According to Mr Dhingra, on an average the new investors have invested about 70 per cent of their money in the TMT shares whose values have eroded by 60-70 per cent since January. The LSE insiders say that the brokers have lost somewhere between Rs 100-110 crore. Mr Dhingra admitted that after the shock of 1992 crisis the individual investors had declined in the region. Now they will think twice to invest in the share market. He said, “The number of investors in the region had drastically declined after that crisis which will further come down after the present
crisis. The market will be dominated by the Mutual Funds and Foreign Investment Institutions now onwards.” The companies in the region who have traditionally shied from the market will further hesitate to bring out their public issues. Mr
R. C. Singal, President, LSE, is, however, optimistic. He said, “The market may hit back if Ketan Parekh succeeds in getting bail and the Income Tax department keeps its promise of not harassing the brokers in the city in future.” |
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FIIs’ inflow at 1,973 cr in March Mumbai, April 1 SEBI’s data on mutual funds for March shows that they were net sellers in equities at Rs 256.50 crore and net buyers in debt at Rs 107.34 crore. The foreign funds remained net buyers in equities and debt on 17 days and 10 days, respectively, in March, the last month of financial year 2000-01. On March 14, the FIIs bought and offloaded equities worth Rs 790.8 crore and Rs 297.5 crore, thus turning net buyers of Rs 493.3 crore ($ 106 mn), the highest for the month. They were net buyers at Rs 292 crore ($ 62.8 mn — March 16) and Rs 288.9 crore ($ 62.1 mn — March 8. On the debt front, the FIIs were net sellers on the last trading day in the month at
Rs 179.2 crore ($ 38.5 mn). On March 22, they purchased to the extent of Rs 21.7 crore while offloading at Rs 90.3 crore, turning net sellers worth Rs 68.6 crore ($ 14.8 mn). For the week ended March 30, the FIIs were net buyers in equities at Rs 118.5 crore ($ 25.5 mn) while remaining net sellers in debt at Rs 163.4 crore ($ 35.1 mn). The foreign funds were net buyers in equities on all the trading days, except on March 29, where they remained net sellers at Rs 32 crore ($ 6.9 mn). The FIIs were net buyers in equities to the tune of Rs 71.3 crore ($ 15.3 mn) on March 28, the highest for the week. On the same day no transaction was conducted in debt.
PTI |
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Power play in
Haryana-1 The Haryana Electricity Regulatory Commission (HERC) passed a tariff order for the FY 2000-01 in December 2000 and new tariff rates were implemented from January 2001. Many political leaders and parties criticised the government for tariff hikes. It is a statutory obligation that the transmission and distribution companies should submit their applications for annual revenue requirement (ARR) and tariff rates for 2001-02 by December 2000. The Haryana Government has granted three months extension in submission of ARRs to the Haryana Vidyut Prasaran Nigam Limited (HVPNL) without taking HERC into its confidence. This act of the government has generated a controversy over the autonomy of the commission. The success of the commission in bringing about transparency and accountability in the functioning of the transmission and distribution companies will not only depend on the legal authority vested in the members of the commission but also on the vigilance and effectiveness of intervention of various social groups. In this context, analysis of the findings of HERC while issuing the tariff order for 2000-01 is quite educative: The evaluation of in technical performance of the transmission and distribution systems is difficult because, the exact amount of power received from Bhakra and Beas power stations was not known as the HVPNL did not have metering arrangement at receiving points in Haryana. Additionally, in the absence of meters at the transmission and distribution interfaces, it is not possible to know the actual level of transmission losses. HVPNL has estimated that free supply to its employees and offices & own works is about 63.55 million units (MU), which is not metered. About 80% of agricultural supply is unmetered. The HERC had directed HVPNL in November 1999 that it must install meters at transmission and distribution interface and it promised to do the needful by December 2000. However, the HVPNL failed to honour its commitment and asked for an extension up to June 2001. The HERC reluctantly agreed and directed it to complete interface metering by 31 July 2001 positively or it will attract some punishment. The commission has directed HVPN and its subsidiaries to replace all defective meters by 31 July 2001. The Government of Haryana has accepted the Minimum Action Plan and has committed to meter all agricultural pump set connections by the end of 2001. Metering is the foremost task to ensure transparency in the system’s functioning. Before the reform process was initiated, the general tendency on the part of management was to underestimate T&D losses and to transfer the losses, including pilferage of power, to the agricultural consumption account which served double purpose: political leadership could project that it is supplying 40-45 per cent of the total supply to the agricultural sector and thereby it was pro-kisan and at the same time it was quite handy for the management to conceal their inefficiency and evade accountability. As a result of an active connivance among the vested interests, up to late 1980s, the HSEB used to project that its T&D losses were about 20%. Then to provide legitimacy to reform process and to discredit the existing institutional set up the management and the political leadership informed the people that T&D losses have increased to about 35% and reforms were inevitable to improve technical performance and to escape from financial bankruptcy. No questions were asked or accountability fixed for the previous mess. Now, the commission has estimated that T&D losses in Haryana were 40.76 %. To bring to an end the game of your guess against my guess, statutory metering and monitoring of power is indispensable. |
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Pepsi lifts yields & hopes Channo (Sangrur) MNC-haters can take heart: Pepsi has not eaten into Punjab’s prosperity. Rather it has helped farmers generate wealth. In 1989 a tomato grower in Punjab got a 16 tonne yield from one hectare. Today he gets 52
tonnes— more than the global average yield of 24 tonnes per hectare. This feat of beating the global production level became possible because of contract farming, intensive agricultural research and the use of latest technology and seed introduced in Punjab by Pepsi in partnership with PAU and the PAIC (Punjab Agro Industries Corporation ). “Nintyfive per cent of tomato grown in Punjab today is according to Pepsi practices,” claimed Mr
P. M. Sinha, President, Pepsi Foods, the Saturday function.
New techniques Pepsi has set up two farms — one at Channo and the other at Jallowal near Jalandhar — to carry out field trial and nursery operations for tomato,
chilli, potato, Basmati and groundnut. With Pepsi farm practices, chilli yield has gone up from six tonnes to 18 tonnes per hectare, potato from 20 to 25 tonnes and groundnut from 10 to 25
tonnes. On Saturday when Mr Parkash Singh Badal inaugurated the company’s Channo concentrate plant built at a cost of Rs 22
crore, mediapersons were taken around the nursery. Mr Abhairam Seth, Pepsi’s executive Director, Exports, explained agro -techniques and equipment used for nursery operations like bed-making,
chiselling, seeding, transplanting, hoeing , fertiliser application and spraying. Pepsi provides its contract farmers and others disease-free transplants, grown in its nurseries with imported hybrid seeds and low tunnel technology. Since the seed is very expensive — one kg of seed tomato costs up to Rs 50,000— a printer and a vacuum seeder are used to ensure their proper sowing. Rice ash is applied to ensure their smooth germination, said Mr
H.S.Sohi, chief of Pepsi’s agro operations. Pepsi has imported from the USA hybrid seed of potato which is low in sugar and highly solid. The Central Potato Research Institute,
Shimla, has cleared it. If chilli production has tripled it is because some 215 varieties have been tested. The company has set up a Rs 6 crore chilli processing plant. It has already entered into a strategic alliance with Hindustan Lever to supply tomato sauce. Pepsi’s thrust is now on contract farming of groundnut, said Mr
Sinha. Since the ground water level in Punjab is going down, groundnut is suitable. It has tremendous export potential. The company is setting up a groundnut processing facility with an eye on exports.
Contract farming Pepsi officials claim that contract farming has benefited farmers by offering them a pre-determined price and a market outlet for their produce , besides new techniques , training, transplants and expert field supervision. But there is no insurance cover to contract farmers, admits Dr
Sohi. Some 20,000 farmers in Punjab are engaged in contract farming with Pepsi. The most crucial part of the contract is pricing. This year Pepsi paid Rs 1.50 a kg for potato, Rs 5 a kg for chilli and Rs 12 a kg for Basmati. With shrinking land holdings, farm implements and seeds going beyond an average farmer’s reach and the growing need to explore new markets, ways to do farming have to change — be it cooperative, contract or corporate farming. PAU and Markfed need to do at much bigger level, what Pepsi has done at a smaller level.
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JK Cement earns profit Jammu, April 1 This was revealed at the 78th Board of Directors meeting here on March 30 which was presided over by the Minister of Industries and Commerce, Dr Sheikh Mustafa Kamal. The company produced and sold Rs 1.12 lakh metric tonne cement during the current financial year recording an increase of 12 per cent over the previous years. Besides the company produced 98,000 mt of clinker which was more than 8,000 mt of the budgeted targets. In March the company registered the highest-ever sale in a single day 1100 mt. The company earned a profit of Rs 1.51 crore besides clearing all cumulative losses and outstanding loans of different financial institutions amounting to Rs 3.35 crore.
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by R. N. Lakhotia Q: My father built a house in 1951 at a cost of Rs 18,000/-, which I have inherited. I want to sell it and seek the following clarifications for the amount so obtained. In what time period I will have to purchase a plot or build a new house from the date of sale to avoid capital gain tax? Can I invest the sale amount in two separate new houses to avoid capital gain tax? Can I invest the full amount (or the balance amount after purchase of a new house) in a bank or bonds to avoid capital gain tax. If so, within what period from the date of sale and in which bank or bonds and for how long. Please quote section. The sale amount will be around 56 lacs. What will be the amount of capital gain tax. A. Singh, Jalandhar Ans: The computation of long-term capital gains will be made after taking into account the cost inflation index, thereby substantially reducing the taxable amount of long-term capital gains. If you want to save capital gains by investing in the construction of a new house then you should make the investment within 3 years from the date of sale. The money till then should be invested in “Capital Gains Account Scheme”. You cannot invest the capital gain amount in two separate houses. Yes, you can invest the entire capital gain only in certain bonds as per Section 54EC of the Income-Tax Act, 1961. This investment has to be made within six months from the date of sale. If you like, you can invest in the house partially and partially invest in the bonds. You should also prepare valuation report as on 1.4.1981 to legally minimise the impact of long-term capital gain. Q: I am writing you in respect of Gallantry Award winners. As per Section 10(18) only Param Vir Chakra or Mahavir Chakra or Vir Chakra are clearly mentioned but under “any other notified gallantry award” the details are not there. The notified Gallantry Awards go down to “mentioned in dispatches” but the Income Tax lawyers and other officials say that only the three mentioned are exempt. Kindly clarify under which authority the exemption can be asked for as I am winner of Gallantry Award “mentioned in dispatches” 1965 to Khem Karan sector. This was published in the Gazette of India Notification No. 76-PRES/66 dated 27 Oct., 66, Part 1 Section 1 of 5 Nov., 66. Brig A.S. Bal, Chandigarh Ans: My congratulation on your receiving the award. Please note that not merely the three awards mentioned by you but even other gallantry awards as are notified by the government would be exempted. Similarly, pension received by individuals would also be exempted. Apparently, it appears that the award given to you is covered by the above section. However, please enquir from the Defence Ministry whether the award which has been awarded to you has been duly notified for the purpose of Section 10(18). |
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by J. C. Anand Be cautious, have patience or else... There is bad news on all fronts. The fourth black Friday was even gloomier than the third black Friday. The Sensex shed 147 points. Ketan Parekh, the great bull operator, was arrested in a pay-order scam case. The Calcutta Stock Exchange’s elected directors resigned to facilitate, an inquiry by SEBI. SEBI has found evidence of rigging in Global Trust Bank shares by two companies set up by Ketan Parekh. According to a report published in a financial daily, the income tax authorities have asked all the 30 brokers of the Ludhiana Stock Exchange on whom survey was conducted by yesterday to furnish their daily trading reports and print-outs of cash books. There is also a report, based on the latest estimates of the Central Statistical Organisation, that the GDP growth during the third quarter is down at 5.7 per cent against 6 per cent during the corresponding period last year. The political situation has not improved a bit. A number of banks have also been wrapped up in the Parekh-Madhavpura Bank scam with heavy losses. The trading volumes have dwindled and the stock market continues to function under severe restraints. It would take at least a couple of weeks for the market to resume its normal functioning. There is a report that the Union Ministry of Finance has set April 16 as the deadline for corporatisation of the stock exchanges so that the broker-members do not have much to do with the management of the stock exchanges. But the process of converting stock exchanges into corporate bodies will take time; and it would retard the normallisation of the stock market. Under these circumstances, no one should expect any substantial revival in the stock market. When leading stock brokers are in the soup due to the CBI and income tax authorities’s raids, the banks are in no position to make advances to brokers and investors on the security of equity shares and the present advance limits are being cut down drastically, there cannot be any bull activity on the stock exchanges. A foreign analyst, closely connected with an FII, has expressed the view on the CNBC cable that it is quite possible for the FIIs to trim their position by selling a part of their holdings this week. In case this happens, the market may suffer another black Friday. The investors should be very cautious. This would call for patience on the part of investors. But if impatience overtakes discretion, investors should make purchases with at least two-years’ perspective. The shares which appear to be relatively safe are: Vikas WSP, Coates of India, Krone Communication and Larsen & Toubro. Gillette India (Indian Shaving Products) has announced good results with 15 per cent dividend and an EPS of Rs 8.11. It is a safe and rewarding investment in case it is viewed from the next two to three years’ perspective. Coates of India, which is now a subsidiary of Sun Chemicals (belonging to the Dainippon Inks group of Japan), has set up a new unit in Ahmedabad. It has also declared a dividend of 42 per cent and is now quoting around Rs 82 or so, and appears to be a safe investment and would prove reqarding during the next two years or so. It appears that the scrip’s price is unlikely to slip any further. MICO has announced better results for the accounting year 31.12.2000. Its equity capital has been scaled down to Rs 48639 lakh from Rs 46736 lakh after the completion of buyback offer. Its EPS is Rs 305 for its Rs 100 face value
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by K. R. Wadhwaney ‘Tehelka’ hits process of AI, IA disinvestment The Tehelka scandal has put a spoke in the wheels of the disinvestment process of Air India and Indian Airlines. Neither politicians nor bureaucrats are willing to hasten the process which, according to analysts, may be considerably delayed, if not scraped altogether. Those who have been opposed to the disinvestment move in the two national carriers have made a capital out of the Tehelka episode. Mr Sharad Yadav said ‘the government is in the process of strengthening the national carriers with a view to preventing their distress sale to strategic partners’. Both Yadav and his deputy Chamanlal Gupta are said to be against the “disinvestment move” now after having initiated it more than a year ago. Aviation sources are of the view that it may not come as a surprise if the “disinvestment scheme” is altogether shelved, as it had happened some years ago on the merger of two airlines. Following Tehelka echo, no politician is willing to put his neck on the chopper. As a game-plan, Air India has been authorised to dry-lease four Airbus 310 aircraft in the next two months. These aircraft will be utilised on the lucrative routes, like, Gulf, Singapore, Bangkok and Hong Kong. Similarly, 2-3 Boeing 747-300s will be secured on dry-lease. They will be operated on Europe and the USA routes. The fleet segmentation in Indian Airlines and its subsidiary Alliance Air has also been worked out. The two airlines bigwigs are optimistic that with fleet expansion, “happier days are ahead”. Cathay Pacific has already started operating flights on the Delhi-Hong Kong sector, while United Airlines will be back in business early this month. Two national carriers will be competing with them without much fuss or worry. Fares may become more competitive than has been the case at present. Ultra-modern equipment has been installed at four international airports. Many other airports will be fitted with sophisticated gadgets to help improve safety measures. If the air traffic controllers start functioning in harmony, the ‘corridors” will be strengthened and there will be lesser chances of mid-air collision.
New Vice-President Ms Vijay Lakshmi (Air India) is new Vice-President National Council and Regional Chairman (North), of the Public Relations Society of India. PRSI is the only professional body of PR in India. It has as many as 28 chapters with membership of more than 2500. An experienced PR personality, Vijay Lakshmi will be responsible for guiding several units in Northern India. Among these units will be Chandigarh, which is fast gaining importance in aviation sphere.
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