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Tuesday,
April 15, 2003, Chandigarh, India  
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BPCL, HPCL
selloff challenged in SC BSNL chief
defends hike in tariff India’s
cellular base touches 1.26 crore Developed
nations should cut farm subsidies: CII Oil prices rise
as Tikrit falls |
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UT agro
sector share falls
Hughes
Software net drops 27 pc
RBI may
cut bank rate
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BPCL, HPCL selloff challenged in SC New Delhi, April 14 The government decision to disinvest 34.01 per cent of its stake in HPCL and 38.02 per cent in BPCL, was challenged in the apex court in a Public Interest Litigation (PIL), which said such a major step could not be taken by the government without Parliament’s approval. Taking cognizance of the PIL by NGO, Centre for Public Interest Litigation (CPIL), a division Bench comprising Mr Justice S. Rajendra Babu and Mr Justice G.P. Mathur sought government’s reply on the issue. The government had on January 26 decided to off load 34.01 per cent stake in HPCL to a strategic investor and divest 38.2 per cent in BPCL through market offering. Describing the decision as “illegal and arbitrary”, the CPIL contended that disinvestment in such a vital and
strategically important sector could not be done merely on the basis of an Executive order. The Centre’s decision came after Attorney General Soli Sorabjee had given his opinion that Parliament’s approval in this case, was not required. HPCL and BPCL, which together account for 40 per cent petro market share, were nationalised through an Act of Parliament in the 1970s and the petitioner contended that disinvestment in these two oil companies could be done either by repealing the Act for acquisition of its assets, the petitioner said. A committee set up by the government on disinvestment had strongly opposed off loading of the Centre’s shares in the oil sector, following which Attorney’ General’s opinion was sought. Sorabjee had further said that his opinion had not been sought on the legal merits of the case and it was for the Government to effectuate the process. He said it would depend on the provisions of the shareholders agreement between the government selected strategic partner and the terms and conditions fixed by the Centre. The government has already invited views of the potential bidders and also appointed HSBC Securities and Capital Market as its financial advisor to effect the investment process.
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BSNL chief defends hike in tariff For instance, a landline subscriber at Chandigarh who wants to call a local friend on his Connect mobile (WiLL), would have to shell out Rs 2.40 per three minute call, instead of Rs 1.20 per three minute call, the present rate. The basic to WiLL phone pulse has been reduced from 180 seconds to 90 seconds. Similarly, to call a person on the cell phone (like Airtel and Spice), the landline subscribers would have to pay Rs 7.20 per three minute call, instead of Rs 1.20. The pulse has been reduced from 120 seconds to 30 seconds. * Free monthly calls reduced from 75 to 30 in urban and to 50 in rural areas Mr Pritpal Singh, Chairman-cum-Managing Director, defending the new tariffs, says, "We have been forced to increase these rates, as under inter connect user charges (ICU), to implemented from May 1, we would have to pay a share of revenue to WiLL and cellular operators for transferring calls to their network. However, in case of landline to landline local calls, the customers would continue to enjoy Rs 1.20 per 180 seconds pulse rates." The industry watchers said the new tariff regime would severely hit the growth of landline connections since the customers would have no advantage of lower tariffs in comparison to cellular subscribers. Interestingly, under selected packages, some cellular operators are even offering mobile to mobile free outgoing calls. Even under BSNL's own Rs 325 monthly rental scheme, the cellular subscriber can make one minute call to landline subscribers for Rs 1.20. For three minute call, they have to shell out Rs 3.60, almost half the price than paid by landline subscribers under new regime. As per the new tariff order, the pulse rate for a distance of 50-100 km (say Chandigarh to Patiala) has been reduced from 2 minutes to 1 minute for landline to landline calls. It means the BSNL landline subscribers would have to pay Rs 2.40 per two minute for calling to landline subscribers, instead of Rs 1.20 per two minute at present pulse rate. At the same rate, said an official of a cellular company, one could easily call from mobile to landline user. The landline and cellular subscribers would also have to pay
additional 12.5 per cent sales tax on monthly rental imposed by Punjab and other state governments, and increased service tax from 5 to 8 per cent, introduced in the current Budget. Mr Pritpal Singh claimed they had already filed a review petition in the Supreme Court against the imposition of double taxation.
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India’s cellular base touches 1.26 crore
New Delhi, April 14 The monthly additions this time, at 9.31 lakh is higher than the 5.93 lakh in February 2003, according to the latest figures released by Cellular Operators Association of India. While relatively higher growth rates were recorded in cumulative heads in all the three circles — A, B and C, metros’ contribution was modest at 3.38 per cent. A relatively higher growth rate during the month was in Circle B and C at 10.69 per cent and 12.74 per cent respectively, the COAI statement said. States such as Kerala, Punjab, Haryana, Uttar Pradesh, Rajasthan, Madhya Pradesh and West Bengal comprise Circle B, while Circle C includes Himachal Pradesh, Bihar, Orissa, Assam, North East and Andaman and Nicobar. During the period in reference, the metros recorded additions of 1.45 lakh (which is more than last month) while circle A comprising states such as Maharashtra, Gujarat, Andhra Pradesh, Karnataka and Tamil Nadu, recorded additions of about four lakh (higher than last month). The subscriber base in Delhi circle rose to 18.06 lakh in March from 17.47 lakh in February.
PTI
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Developed nations should cut farm subsidies: CII New Delhi, April 14 “India should consider the current negotiations under the Doha round of the WTO to be successful only if they result in developed countries giving lesser domestic subsidies to agriculture or even eliminating these subsidies,” the CII said in a statement here. Such a move by developed countries would raise the international prices of agricultural commodities to remunerative levels and help ensure stability of income for farmers in developing countries. The focus of the current negotiations should be on getting the developed countries to make substantial commitments to reduce or eliminate domestic support and export subsidies and then move on to market access issues, the CII said in its position paper on agriculture, submitted to the government. Referring to the second draft paper of the Chairman of the WTO’s agriculture council, Mr Stuart Harbinson, the CII said though the paper could serve as a base paper on negotiations for market access, modifications were needed. The CII said first the concerns of developing countries should be taken into account and the principles of less than full reciprocity maintained. The CII mooted exemption from reduction commitment on tariff for items of staple consumption that could affect food security and inclusion of all food safety issues in the Sanitary and Phyto-Sanitary Agreement. On the question of domestic support, the CII said while the developing countries were ill-equipped to provide even needed subsidies to their farmers, the developed countries could continue to give subsidies to their rich farmers under various categories. In the interests of clarity, transparency and effective
education of subsidies, there should be fewer categories or boxes. The CII also said that for the purpose of ensuring that special interests of developing countries were taken care of, special safeguard measures should be provided to developing countries under Article 5 of the existing agreement. The CII said export subsidy for agricultural produce should be completely eliminated within an agreed time, with a major down payment in the beginning.
Annan on subsidies United Nations (AFP): UN Secretary-General Kofi Annan urged rich countries on Monday to give a much-needed boost to world trade talks by making immediate and dramatic cuts in farm subsidies. The 146-member WTO failed to reach an agreement last month on freeing up trade in agriculture, casting doubts over the outcome of the three-year Doha round of trade talks, due to end in November.
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Oil prices rise
as Tikrit falls
London, April 14 Reference Brent North Sea crude for May delivery rose 23 cents to $ 24.98 a barrel in late deals here as earlier falls were reversed. New York’s benchmark light sweet crude contract for May delivery was up 31 cents a barrel to $ 28.45 in early trading. The price drop had come as US forces took control of the centre of Tikrit, the home town and traditional power base of deposed Iraqi leader Saddam Hussein. The seizure of the largely deserted city appeared to mark the last major military engagement of the 26-day-old war, and prompted hopes that Iraq’s oil production could resume soon. “The general perception was that the Iraqi crude was going to come back into the market,” said GNI trader Paul Goodhew. However, he added, scepticism about predictions that output could be swiftly restored later drove the market up.
AFP
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UT agro sector share falls Chandigarh, April 14 Economists claim that the declining share of agriculture in the UT economy has wider implications. On the one hand, they say, employment opportunities are shifting to manufacturing and service sector, but on the other, about 1 lakh untrained youths, registered as unemployed with the employment exchange, are unable to find jobs here. Secondly, the growing service sector, especially tourism, communication and the hotel industry would have to depend on neighbouring states for growth. Similarly, the supply of milk products, fruits and other agricultural items would be met from other states. Since city residents enjoy highest per capita income of over Rs 42,000 per annum, the importance of unsophisticated small-scale industrial units would continue to decline in the coming years. Under various schemes of the Ministry of Agriculture, the administration still receives various grants and aid for agriculture and rural infrastructure development, yet it finds itself unable to utilise these funds. For instance, under the ninth Five-Year Plan (1997-2002), the total Plan outlay for agriculture and allied activities was Rs 7.22 crore but it could spend just Rs 2.34 crore. Similarly, under the 2001-02 Annual Plan, the expenses were Rs 7.25 crore against the Plan outlay of Rs 7.39 crore. Bank officials lament that they are unable to meet the annual target of crop loans and term loans due to low demand in the agriculture sector. Though there are over 20 villages in the UT, but the total area under agriculture has sharply declined. The administration has recently acquired land at Kishangarh village to develop an IT park and at Kaimbala village to develop a botanical
garden. The villagers claim that their land is being encroached upon by slum dwellers, and the fertile land is being converted into a dumping ground. According to information available from the Statistical Abstract, the area under vegetables declined from 325 hectares in 1999-2000 to 230 hectares in 2001-02. Similarly, the area under fruits had declined from 116 hectares to 82 hectares during the same period. However, the share of manufacturing units and service sector has proportionately increased during that period. By 2001-02, in the net state domestic production, the share of manufacturing, construction, electricity and water sector had reached 27.24 per cent at current prices, against 71.39 per cent share of service sector, including transport, communications, hotels, real estate and public administration. Experts say that with the increasing share of the service sector, the administration would have to devise ways to improve productivity of that sector, apart from preparing youths for the growing segments of the economy.
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Chandigarh, April 14