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Wednesday,
April 2, 2003, Chandigarh, India  
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Farm diversification can halt negative growth
Draft SEZ Bill ready: Jaitley
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Graphics:
VAT: exempted units may be loser
Tough time ahead for IT firms
BHEL profit up
Garment makers go
on strike
Joshi Autozone tops in sales
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Farm diversification can halt negative growth New Delhi, April 1 The farm sector growth declined by 7.9 per cent during October-December 2001, overshadowing the 6.3 per cent growth in manufacturing and over 7 per cent growth during the said period in services sector. The CSO figures for October-December stated that the agricultural sector flatered as production of rice fell by 15.5 per cent, coarse cereals by 29.9 per cent, pulses by 18.1 per cent and oilseeds by 34.4 per cent during the kharif season, data compiled by Department of Agriculture and Cooperation said. Production of cotton and sugarcane is also expected to fall by 11.4 and 4.9 per cent respectively in this fiscal, it added. While the short term fall in farm sector growth were due to natural calamity like drought and cyclone, the experts said the worrying aspect is the overall negative growth over a period of time. The farm sector growth in the Indo-Gangetic plain over the years has declined due to wheat/paddy rotation and this could be arrested by crop diversification, said Deputy Director General of Indian Council of Agricultural Research, prof J.S. Samra. Prof Samra, who heads the natural resources management division, said the policy planners could increase the farm productivity by pushing up production in rainfed areas and at the sametime enabling farmers to go in for better management of farm sector. “Manure, pest and disease management and integrated approach to the marketing of the produce would go a long way in incrasing the farm sector growth in the country,” he said. Prof Punjab Singh, former Director General of ICAR, said the input requirements in the farms are not matching the needs and use of fertilizers in Punjab and Haryana, though above the national average, is less than the global levels. He said judicious and scientific use of farm inputs added to the integrated approach to the marketing of the produce would result in high farm sector growth. While the experts agreed that the minimum support price for wheat and paddy was acting as a hurdle for farmers to diversify, they opined that MSP could be used as a tool to help the farmers to diversify, which would not only help the soil to re-energise its depleated resources, it would also help the farmers assured sum rather than depend on the market forces. The Economic Survey asked the government to accelerate diversification in agriculture, with value addition in horticulture, floriculture and sericulture as also in food processing as it can yield rich dividends and infrastructure like cold storage must be strengthened through public-private partnership. The survey said the 13.6 per cent fall in foodgrain output to 183.2 million tonnes, lowest since 1996-97, is mainly due to the decline in kharif production from 111.5 million tonnes last year to 90.3 million tonnes this year, showing a decline of 10.09 per cent. The rabi foodgrain output is also likely drop to 92.9 million tonnes compared to last year’s 100.5 million tonnes, a drop of 7.5 per cent, it said, adding “the effect of drought on oilseeds is expected to be severe and production may fall to 15.4 million tonnes from last year’s 20.5 million tonnes.” It said unlike floods where the impact is limited to only one season, the impact of drought lasts not only through the four months of Kharif season (July-October) but also through rabi (November-March) and next kharif upto October when new harvest arrives and incomes begin to accrue.
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Draft SEZ Bill ready: Jaitley New Delhi, April 1 The Minister said that the comprehensive legislations is aimed at reducing the delays which are perceived to be coming in the way of speedy execution of the SEZ model. Expressing hope about achieving a political consensus on the issue, the Minister said that “even in political process, people realise the importance of areas like exports and foreign exchange and we are capable of building a larger consensus,” he added. Exhorting the role of states with regard to labour issues, the Minister said that “this is a subject where states must be a participant cutting across political partie”. “Some of them are seriously considering preparation for making an exception in the case of export units. This is one step which perhaps for the future could give cutting edge as far as our export community is concerned”, he said. The Minister further pointed out that the high transaction cost is another important factor, which has been adversely affecting Indian exports internationally. Some of these have been emanating due inefficiencies at the port. He added that the Electronic Data Interchange (EDI) scheme, which will connect 23 ports, will cut down transaction costs “immensely”. On the issue of harmonisation of schemes, the Minister said that it will not be possible to harmonise all the schemes because the Centre cannot neutralise state taxes. But at least two of the schemes — duty drawback and Duty Entitlement Passbook Scheme (DEPB) — are capable of being harmonised. “Convergence of these schemes in the foreseeable future is very likely and the exporting community must prepare for the scenario”, Mr Jaitley said.
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Exports up, but trade deficit widens New Delhi, April 1 India’s imports during April to February 2002-03 were valued at $ 53,865.65 million representing an increase of 16.31 per cent over the level of imports valued at $ 46,312.96 million during the same period last year. Commerce and Industry Minister Arun Jaitley today expressed hope that the total merchandise exports would touch the $ 50 billion mark for the full year, which ended yesterday. The trade deficit for the 11-month period had widened to $ 7.79 billion from $ 6.85 billion over the comparable months the previous year. The oil imports during the period were valued at $ 16.06 billion, showing an increase of 26.32 per cent from $ 12.71 billion.
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VAT: exempted units may be loser THE Punjab Government to encourage the industry and its development had exempted new industrial units and the units undertaking expansion/modernisation from payment of sales tax. The Industrial Policy was announced by the successive governments in 1989, 1991 and in 1996. These industrial units are popularly known as exempted units. Many of these units are left with substantial benefit of exemption from payment of sales tax unutilised. With the dwindling revenues, the state government has decided not to offer any tax concessions to new industries. In defence of its decision, it is argued that these concessions distort the investment decision and give unfair tax advantage to exempted units. Now it has been decided that all states will switch over to VAT from the existing system of levy of sales tax from April 1. VAT is a system of collection of sales tax under which tax is charged at each stage of sale on the value added to the goods. In a specified period, the tax paid on purchases (called input tax credit) is reduced from tax charged by a particular dealer and the balance amount is deposited with the government. The state government has published the Punjab VAT Act, 2003 (likely to be enacted) with proposed rules (to cover procedural aspect). Under the proposed Act the state government had promised the exempted units, the benefit of exemption of tax after coming into force the VAT Act but a rider was added that neither the exempted unit nor subsequent purchaser will be eligible for input tax credit. It was how the government had circumvented the exempted units without directly breaching the promise on the basis of which new industrial units were put in Punjab. However, before the final enactment, the Sales Tax Department has come out with a half-baked corrective action through guideline on its website relating to exempted units. According to these guidelines turnover-based credits is allowed to exempted units and subsequent selling dealer will claim adjustment of purchase price of such goods (from exempted units) when they are sold. These guidelines have raised more questions than
answers: 1. VAT is based on input tax credit and rebate offered to exempted units in turnover based that is going against the spirit and concept of VAT. 2. That official clarification says: no adjustment of purchase price by subsequent dealers will be allowed, if the goods are used for any purpose other than re-sale. Under these circumstances, a manufacturer of goods will not be entitled to the benefit of purchases from exempted units, thereby putting the exempted units at a disadvantage. for example, a hosiery goods manufacturer will have to pay full tax on sale price as it will not be entitled to input tax credit on yarn (raw material for hosiery goods) purchased from exempted units. 3. With the VAT Act coming into force, the fate of purchases from exempted units held as stock on that day by subsequent purchasers or sellers is not clear. Whether they will be entitled for claiming input tax credit on such purchases or turnover credit as tax paid purchases is not clear. 4. There is no clarification of benefit to exempted units in case of inter-state sales, which was earlier available under the Punjab General Sales Tax Act.
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Tough time ahead for IT firms
New Delhi, March 31 As Indian training institutes churned out tens of thousands of computer literates a year, the vast majority had jobs waiting for them overseas with the local firms rushing to spread wings to offer services at sharply lower rates. But as the global recession tightens its grip and job losses in many economies become a norm, India's cost-effective software army is increasingly becoming the envy of foreign lands. The backlash against Indian firms in the tech world is gaining ground, whether in the form of opposition to US and British companies outsourcing jobs to India or European nations imposing visa restrictions on Indian IT staff. "As the authorities abroad try to contain the backlash against rising unemployment, foreign workers become the first target," said Kiran Karnik, President of Nasscom. "As India's software professionals are spread out across the globe, it is a matter of concern that the top executives of the companies are now being treated with hostility," Karnik told IANS. And if the alleged harassment meted out to the Indian techies overseas in the last six months is any indication, the domestic industry is in for tougher times ahead, say analysts. Software companies are concerned about their businesses in countries ranging from the USA to Indonesia, where political parties and trade unions are becoming increasingly twitchy about "foreign" workers snatching away jobs. In the latest incident of backlash against Indian software pros, nearly 15 professionals of i-flex Solutions were questioned in Amsterdam last week. The company said it was not aware of the exact extent of investigations but that knew they were questioned over visa-related matters. The employees were later told by the Dutch authorities to leave the country within a week. i-flex said CEO of its Netherlands subsidiary Senthil Kumar was also arrested in London, apparently following a complaint by the Dutch government. i-flex is among India's top 20 software exporters with a turnover of $100 million. In the Netherlands, the company is mainly in the business of providing software solutions for banking. Nasscom says it plans to closely work with the IT industry and Embassies of various countries to ensure greater understanding of visa-related issues. Indian software firms say the impact of the harassment of professionals in foreign countries is likely to be felt on businesses sooner than later. "IT companies cannot begin project work in, say, two weeks' time at their customer's offices," said a finance officer of a Bangalore-based mid-size services company. "Governments in developed as well as developing countries are becoming very strict and watchful in supporting their communities and local jobs," the official added. India's cost-effective software army caters to a wide customer range, including global financial giants and telecom equipment makers. While price competitiveness has been its strong point, the slowdown that hit last year has made it a necessity. This has helped the industry to log a 29 per cent growth in software exports to $7.5 billion in the fiscal year ended March, 2002, over the previous year. This compares with just $1 billion worth of software exports during 1996-97. But the backlash is bad news for the Indian IT sector, which is still hoping to reach its $80 billion revenue target by 2008 by selling software and services abroad. The backlash against IT pros comes as a double whammy for local tech firms who are also facing increased opposition from policymakers and powerful unions in the USA and Britain on outsourcing jobs to India.
IANS
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BHEL profit up
New Delhi, April 1 |
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Garment makers go on strike New Delhi, April 1 The hosiery manufacturers of Ludhiana had already announced the closure of their businesses till April 6 and would now join their counterparts in other states for an indefinite period, Mr K.K. Balli, convener, Delhi Readymade Garment Udyog Sangharsh Samiti, said. During the strike, rallies, demonstrations and sit-ins would be organised across the country to press for the withdrawal of excise duty imposition, Mr Balli said. He said two years ago then Finance Minister Yashwant Sinha had exempted readymade garment producers from excise duty up to a turnover of Rs 1 crore. But in the recent Budget the same had been
re-imposed with no limits fixed for its applicability, he added.
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Joshi Autozone tops in sales Chandigarh, April 1 Hero Honda sales cross Rs 5000 cr CHANDIGARH:
Hero Honda today announced its achievement of over Rs 5000 crore (US $1 billion) sales turnover landmark for the year 2002-2003. The total sales turnover for 2002-2003 is estimated to cross Rs 5000 crore, up from last year’s turnover of Rs 4539.49 crore. The detailed figures will be announced post the Board Meeting in April 2003. The company finished the year with total motor cycles sales of 16.77 lakh, an increase of 18 per cent last years sales of 14.25 lakh units.
TNS
TVS Motor sales dip NEW DELHI:
TVS Motor Company today reported a 2.86 per cent dip in two-wheeler sales in March 2003 owing to a modest growth in motorcycle sales and decline in the scooterette and moped segment. The company sold 85,015 units against 87,523 units in the same month last year. Motor cycles sales grew by 1.8 per cent to 55, 659 units while scooterette and moped sales slipped by 1.53 and 13.8 per cent to 8,457 and 20,899 units respectively in the month under review, a company release said.
PTI
Otis Elevator marks 150th birthday FARMINGTON, CONNECTICUT:
Otis Elevator Co today marks 150 years in business, from its start using a platform hooked to a rope and wagon spring to a worldwide company that lifts passengers billions of times on the strength of a computer chip. The company, which began with the sale of a safety elevator by founder Elisha Graves Otis in 1853, has 1.3 million elevators in service around the world. It sells about 80,000 elevators a year and 8,000 escalators.
AP
Ranbaxy gets FDA nod NEW DELHI:
Ranbaxy Laboratories Limited (RLL) has received approval from the United States Food and Drug Administration to market Flecainide Acetate Tablets USP in 50 mg, 100 mg, and 150 mg strengths. The product is expected to be available through wholesalers and other distribution outlets to dispensing pharmacies throughout the United States, it added.
UNI
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Price index falls Salora Intl Western Union L&T Cement Spinning Mills |
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