New Delhi, June 15
Quibbling between the Centre and the states on who should provide more relief to consumers on fuel prices intensified with the latter asking the Union Government to give an account of accruals to it from the latest hike in petrol and diesel prices.

The Empowered Committee of state finance ministers on VAT, headed by Left-ruled West Bengal's Finance Minister, today took a "unanimous" decision to ask the Union Finance Ministry whether it is contemplating any excise cut on petrol and diesel.

The decision comes after Petroleum Minister Murli Deora asked states to slash sales tax on fuel prices to partly offset the hike in prices of petrol and diesel.

Briefing reporters after the Empowered Committee's meeting, its chairman Asim Dasgupta said the Union Finance Ministry should also provide them information about determination of domestic basic prices of petroleum products in relation to international crude prices over the past three years.

"We will consider the Union Petroleum Minister's request after we get information on these three matters," he said.

While some states ruled by Congress and other UPA constituents have reduced sales tax, bringing down fuel prices by up to Re 1, the Left and NDA-ruled states that criticised the hike in petro prices are yet to cut sales tax on fuel.

After hiking petrol prices by Rs 4 per litre and diesel by Rs 2, Union Petroleum Minister Murli Deora had requested state chief ministers to cut sales tax on these products so as not to pass on the entire burden to consumers.

On its part, the Centre had also announced customs duty cut on petroleum products from 10 to 7.5 per cent and issuance of bonds of Rs 28,000 crore to oil marketing PSUs.

Mr Dasgupta said VAT committee did not accept Deora's request for bringing down uniform floor rates on petrol and diesel to 12.5 per cent from current 20 per cent.

He also explained that petrol and diesel have not been brought under VAT since its prices are not market determined. — PTI

New Delhi, June 15
To avoid another Balco-like situation, the government is planning to take the market route to off-load 13 per cent of the 29 per cent shares it holds in Hindustan Zinc Limited (HZL) through a public offer, sources said.

Based on the average price of the company shares on the stock exchanges, the government can raise up to Rs 1,700 crore from selling 54,929,147 shares in HZL.

The government wants to part with its stake in HZL before April next year as after that present owner Sterlite will get right to buy the entire residual stake.

Sterlite, which had bought Balco, had exercised its call option for the remaining 49 per cent stake in the company. But the sale could not be completed because of a tough stance taken by Sterlite and the government over valuation.

To buttress its stand Sterlite sent a cheque for Rs 1,098 crore to the government for the stake even before the differences over valuation could be sorted out.

It even sent a legal notice in a bid to put the government on the back foot. In order to avoid a repeat, the government has decided to sell a part of its share in HZL through public offer.

In 2002 the government sold 26 per cent of its shareholding in HZL to the Sterlite Group for Rs 445 crore. A year later, it sold another 18.92 per cent shares of the company to the new owner.

At present, Sterlite owns a 64.92 per cent stake in HZL while 3.08 per cent is with institutions and 1.7 per cent is with people. — PTI 

New Delhi, June 15
The Planning Commission has said that the level of FDI inflow is much below the country’s potential and the nation needed to attract about $15 billion worth of FDI in the 11th Five -Year Plan.

In its draft approach paper on the 11th Plan, the commission pointed out that a direct benefit from global integration was the increased FDI inflow which increased from $3.7 billion in the Ninth Plan to $5.4 billion during the first four years of the Tenth Plan, which was below the country’s potential.

In 2005-06, the FDI inflow was $8.2 billion and Commerce and Industry Minister Kamal Nath has indicated that the FDI inflow into the country could be pushed up to $12 billion.

“The National Common Minimum Programme (NCMP) stated that the country needs and can absorb three times the amount of FDI it gets. This remains a reasonable target and can be achieved in the 11th Plan,” the commission observed in the paper.

The plan panel pointed out that certain grey areas which remained areas of concern would have to be dealt with. The key area was the health sector. The commission observed and suggested since healthcare was costly and beyond the reach of the common man, public funding could be a reliable panacea to spread their ambit.

The Planning Commission pointed out that one of the major challenges before the government was to reverse the deceleration in agricultural growth during the 11th Plan.

To reverse this trend, corrective policies adopted must focus not only on the small and marginal farmers who continue to deserve special attention, but also on middle and large farmers who too suffer from productivity stagnation arising from a variety of constraints,” the commission suggested.

The plan panel observed that a second green revolution was urgently needed to raise the growth rate of agricultural GDP to around 4 per cent which was not an easy task considering the fact that the actual growth of agricultural GDP, including forestry and fishing, was only 1 per cent per annum in the first three years of the Tenth Plan.

Similarly manufacturing competitiveness, which had witnessed sluggish growth too needed to be infused with fresh vigour and the target should be to ensure its growth to around 12 per cent in order to achieve a GDP growth of between 8 and 9 per cent.

The commission suggested that to render the manufacturing sector competitive, constraints would have to be removed and the key hurdle was lack of infrastructure such as roads, ports, railways, airports and power which, it said, was not up to the standard prevailing in the competitor countries and must be rectified within the next five to 10 years. — PTI

New Delhi, June 15
SEBI said today that it would announce guidelines for launching real estate mutual funds by next week.

Addressing the CII Mutual Fund Summit, 2006, ‘Indian Mutual Fund Industry: Generation Next’ in Mumbai today, Mr M. Damodaran, Chairman of SEBI, announced that the guidelines for launching real estate mutual funds in India would be promulgated next week.

He also said SEBI was planning to take measures to contain volatility in stocks, after a month-long slide wiped out the entire gains made in 2006.

Mr Damodaran also announced that capital protection schemes would be launched by next month and that the scope for launching Indian mutual fund schemes aimed at overseas investors was under active consideration as a follow-on to the Finance Minister’s announcement in his Budget speech.

Mr Damodaran complimented the mutual fund industry on its growth performance over the past year. According to him, the industry growth has been beyond figures and mutual funds have done excellent work in

reaching out to new segments and adopting a better fee structure.

“I believe mutual funds today are far more significant than they were a year ago. It is time to press down the accelerator,” he said while addressing the CII meet.

Mr. Damodaran called for a greater role on part of mutual fund trustees, especially in relation to new fund offerings. He said that mutual funds should not only publicise new offerings but also their existing schemes.

Before launching any new fund offerings, they should first verify that the ambit was not already covered by one of their existing, older offerings.

He also asked mutual funds to alert investors about aspects like ups and downs in the stock markets. There is reasonable money to be made in this asset class if you take informed decisions, he felt.

Mr S.V. Prasad, Chairman-CII Mutual Fund Summit, 2006, pointed out that even today; debt and cash funds constitute 60 per cent of the mutual fund industry.

“People should understand that mutual funds are long-term solutions provider across various asset classes. The Indian mutual fund industry has taken big strides and is as good as any in the world. It has done extremely well by all yardsticks,” he said. 

New Delhi, June 15
Tata Chemicals Ltd said today it was looking for acquisition in the domestic market.

“We are always on the look out for opportunities. We are open to all options, including acquisitions of domestic companies,” Tata Chemicals Ltd CEO (Food Additives Business) Satish Sohoni said here.

The company which had clocked a volume of 4.58 lakh tonnes of edible salt production last year was nearing 100 per cent capacity utilisation and hence was trying to address the need for further capacity.

TCL, which has also started exporting edible salt to West Asia, Yemen and Singapore under the brand ‘Tata Topp’, however, is not looking for overseas acquisitions.

The company commands about 52 per cent of the national branded salt market.
— PTI

Mumbai, June 15
Nicholas Piramal India Ltd (NPIL) today signed an agreement with Pfizer to acquire the latter’s Morpeth manufacturing facility.

‘The Morpeth site is one of Pfizer Global Pharmaceuticals’ largest high-quality, integrated facilities. It has end-to-end production and supply chain capabilities that cover APIs (active pharmaceutical ingredient), finished dosage, packaging and distribution,’ a Nicholas Piramal statement said.

‘The company’s 100 per cent subsidiary in Britain, NPIL Pharmaceuticals (UK) Ltd (earlier known as Avecia Pharmaceuticals), has entered into an agreement to acquire the Morpeth facility on an asset purchase basis,’ it said.

The transaction will include a supply agreement up till November, 2011, totalling potential revenue above $350 million and site-fixed assets and property. The transaction, to be completed by June 19, is on a liability and cash free basis.

With the acquisition of Morpeth, the company has gained strategic entry into the global souring network of Pfizer Inc. After the transaction, the company will emerge as one of the world’s top 10 pharmaceuticals outsourcing companies, across custom synthesis, APIs and finished dosage.

New Delhi, June 15
India and Kuwait today inked three agreements on avoidance of double taxation, cooperation in drugs and narcotics control and boosting cultural ties, and decided to move together in oil sector for mutual benefits.

The agreements were signed after visiting Kuwait's Aamir Sheikh Sabah Al -Ahmad Al Jaber Al Sabah met Prime Minister Manmohan Singh.

Kuwaiti Oil Minister Sheikh Ahmed Fahd Al-Sabah said the association with Indian oil companies was working out extremely well and hoped more Indian companies would take interest in his country's most prized asset.

Indian Oil Corporation (IOC) has expressed interest to join the gas-based projects in Kuwait and had in last March inked a key agreement with the Kuwait Petroleum Corporation for trade of hydrocarbons, oil and gas exploration, refinery and research.

Kuwait is pitching for greater investments from India in the oil and petroleum sector as Asia's third largest economy seeks to expand its exploration and manufacturing prowess abroad.

IOC and ONGC have urged the government to push with the Aamir, their stake in Project Kuwait, where they are bidding for further development of Kuwait's four oilfields.

The two oil majors are part of an international consortium that includes British Petroleum and US-based Occidental Petroleum Corporation, which have won rights to submit the final bids and will face stiff competition from an Exxon Mobil-led consortium and another led by Chevron Texco.

The final tender process for the development of fourth north Kuwaiti fields in Raudhatain, Sapriya, Ratqa and Abdali to nearly double their oil production to 9 lakh barrels per day in 20 years, will be through by June-end.

Chandigarh, June 15
IBM plans to help small and medium enterprises (SMEs) run more efficiently by using its customised business solutions.

With a view to expanding its presence in the region, the company has set up an office in the Rajiv Gandhi Chandigarh Technology Park.

Mr B. Srinivas Anand, Vice-President (India — North and East), IBM, stated that with the opening of the full-fledged office, the company would cater to Punjab, Haryana, Himachal Pradesh and J&K as also the UT of Chandigarh.

Talking about the potential growth areas for the company in the region, Mr Anand said IBM was aiming at tapping textiles, engineering plus manufacturing sectors and education sector and the governments' e-governance programmes to achieve growth.

Mumbai, June 15
Gold and silver today recovered smartly on reports of bullish global advice.

Standard gold ( 99.5 purity) and pure gold (99.9 purity) opened high at Rs 8,480 and Rs 8,525 per 10 gm, respectively.

Both yellow metals recovered smartly and closed at Rs 8,560 and at Rs 8,605 per 10 gm with a huge gain of Rs 90 for standard gold and Rs 95 for pure gold from their yesterday’s closings.

Similarly, silver .999 fineness variety also opened higher at Rs 15,350 per kg on improved demand. Later, it closed still higher at Rs 15,660 per kg with a massive gain of Rs 315 from its previous closing. There was better buying support from local dealers and industrial users in view of encouraging advice from overseas markets.

Following were the spot silver and gold closing prices today: silver (per kg) .999 grade : Rs 15,660 (Rs 15,315), gold (per 10 gm): standard mint 99.5 purity : Rs 8,560 (Rs 8,470), pure gold 99.9 purity : Rs 8,605 (Rs 8,515). — PTI

Kochi, June 15
Planning its first overseas foray, Vijaya Bank has applied to the Centre and the RBI for permission to open branches in West Asia, China and Hong Kong.

Vijaya Bank CMD Prakash P. Mallaya said the bank was hopeful of opening the branches this year, the platinum jubilee of the bank.

On mergers and acquisitions, Mr Mallaya said while these were becoming increasingly necessary to achieve economy of scales, the Vijaya Bank did not have any plans in this direction.

The bank was targeting a business turnover of Rs 60,000 crore with a net profit of Rs 350 crore in the current financial year. Agriculture, small scale and medium scale enterprises and retail loans will continue to be the focus areas for the bank.