The Tribune, Chandigarh, India

	Pepsi to pump in $200m New Delhi, January 9 The government today cleared a proposal of Pepsico Holdings Pvt Ltd to inject additional equity of $ 200 million (around Rs 930 crore) into its Indian arm within three years. A few months ago, the company had announced plans to pump in $ 200 million in 2010 on expanding manufacturing capacity, market infrastructure, supply chain and R&D. The investment, approved by the Cabinet Committee on Economic Affairs at its meeting here, will take Pepsico's total FDI into the country to $ 655 million. The company had said of the planned $ 220 million investments, $ 170 million would be from Pepsico while $50 million would come from its bottling partners. The approval is to invest the money within three years but the company has plans to spend it within a year. "This is by far the largest investment made by the company... in a single year since its entry into India," Pepsico India chairman and CEO Sanjeev Chadha had said in a recent interview. The $ 200 million is part of Pepsico's $ 500-million investment plans, spread over three years, announced by the company's India-born global head Indra Nooyi during her visit to the country last year. Pepsico, which held its high-profile global board meeting in India in November, had announced that it would triple its business in country every five years. In addition to $ 200-million approved today, Pepsico had earlier said it would set up four new plants over a period of three years, out of which three units would be for beverages business and one for snacks. According to industry estimates, on an average it costs around $ 30 million to set up a beverages plant and around $ 50-60 million for a food plant. The company is in the process of identifying locations of these plants. Since its entry in India 19 years ago, the company has invested over $ 1 billion in the country. — PTI
	Denial Of Pay Scale Punjab coop bank staff to go on strike Ruchika M. Khanna Tribune News Service Chandigarh, January 9 The recovery of agriculture loans being affected by the Punjab State Cooperative Agriculture Development Bank can be adversely affected as employees of the bank have decided to go on strike in support of their demands. Bank employees will observe a pen down strike on January 19 and no field officers of the bank would go for recovery of loans. These employees are up in arms against the management for refusing them revised pay scales in accordance with the recommendations of the Fifth Pay Commission, besides denying them pension. These employees will be supported by employees of Central Cooperative Bank, who will observe strike with them on January 29. The bank employees have been demanding that their pay scales should be revised from January, 2006, as in the case of other state government employees. They have also been demanding that the pension scheme for working and retired employees should be continued as the management has refused to deposit the same on account of paucity of funds. They are also demanding that the management of the bank be handed over to people from NABARD and financial experts for a turnaround of the bank, besides raising their concern over abolition of posts in the name of restructuring. The bank has 89 branches across Punjab, of which 40 branches are running in losses. Thanks to the political interference in stalling the recovery of agriculture loans. Last year, the recovery of the bank was around 55 per cent, and this year the bank has set a target for recovery of 50 per cent of the advances made by the bank. “The bank has already been slow on advances side and as against a target of Rs 525 crore this year, we have advanced just Rs 300 crore as agriculture loans this year. With the bank employees now going on strike and refusing to go for the recovery duty in protest, the recovery will be adversely affected,” said a senior official of the bank.
	Budget likely on Feb 26 New Delhi, January 9 The Budget for 2010-11 is likely to be presented on February 26, two days ahead of the conventional date. Finance Minister Pranab Mukherjee indicated this to journalists during a lunch hosted by him at his residence here today. The annual Budget date is being advanced from the normal practice of being presented on February 28, because February 27 is a government holiday on account of Prophet Mohammad's birthday and February 28 being a Sunday. The Cabinet is expected to approve the date soon. Mukherjee said the economy was generally looking up and signs were good. The budget exercise has already been initiated by the Finance Ministry amid a debate on whether stimulus measures should continue and if so, for how long, in the wake of the economy showing signs of recovery. Both Prime Minister Manmohan Singh as well as Mukherjee have expressed the confidence that India's GDP rate would clock 9-10 per cent growth in the near future and expand by over 7 per cent this fiscal. — PTI
	Food price review on Tuesday New Delhi, January 9 The Cabinet Committee on Prices will meet on Tuesday and is likely to consider various options to curb rising inflation and keep essential commodities from spiralling further. Food inflation stood at 18.22 per cent during for the week ended December 26, 2009. Prices of metals, basic raw material for industry, have also shot up in the last 45 days. To reverse the rising trend, the Cabinet Committee on Prices (CCP) to be presided over by Prime Minister Manmohan Singh may explore options like easing imports of essential commodities. Containing sugar price, which have more than doubled over the last one year to Rs 45 a kg in the retail market, is among the major concerns for the government. — PTI
	NTPC FPO prospectus tomorrow likely New Delhi, January 9 The NTPC is likely to file a draft prospectus with SEBI on Monday for its follow-on public offer, which is expected to open early next month. Two other state-owned power firms, Rural Electrification Corporation (REC) and Satluj Jal Vitran Nigam Limited, are also expected to follow the NTPC within this fiscal, Finance Ministry sources said. Public offer from NMDC is also on the cards before end of this fiscal. "The Draft Red-Herring Prospectus from the NTPC is likely to be filed on Monday and expected to be cleared through fast-track route for speedy clearance so it could hit market by first week of February," an official said. — PTI
	JK Tyre plans expansion New Delhi, January 9 JK Tyre today said it would invest Rs 1,200 crore in the next three-four years for capacity addition which included setting up of a new plant in Karnataka with an investment of Rs 800 crore. "JK Tyre has recently completed a Rs 315-crore expansion project to increase truck and bus radial tyre capacity from 4 lakh to 8 lakh tyres per annum and is also planning to invest Rs 1,200 crore in the next three to four years to fulfil the demand for quality tyres," a statement, quoting JK Tyre & Industries president Arun Bajoria said. — PTI
	Aviation Notes Airport users’ tax uncalled for by K.R. Wadhwaney The charging of airport users' tax from passengers on domestic and international routes, airlines’ incurring huge expenses on training of pilots and needless hurry in constructing the third longest runway have proved counter-productive as flight disruption is continuing unabated during the ongoing foggy season. Losses of the airlines, operating on national and international routes, are multiplying and Indira Gandhi International Airport (IGIA) is functioning as sleepily as before and passengers continue to face inconveniences. The tax levied on the passengers is totally uncalled for. Does the Railways charge any tax from passengers? Why should private outfit be allowed to charge fee when it is unable to cater to the needs of the passengers? Why were airlines subjected to incur heavy expenses on pilots' training when the sophisticated gadgets were functioning erratically? Where was the need to construct another runway on the flight path? Who is blamed for the unstable conditions at prestigious IGIA? There are several reasons for the apathy causing concern to all users from passengers to airlines. The part of the blame may rest on the erratic functioning of the international Instruments . Landing System (ILS) category III. But the major blame lies with the top functionaries of GMR, Delhi International Airport Limited (DIAL) and the Airports Authority of India (AAI) for making lofty promises without making adequate arrangements to tackle operations of flights in foggy seasons. If the bellies of these bodies are bulging with money, the country continues to get negative publicity because of thoughtless functioning of senior officials. This is not all. Flights are disrupted or bunched together, the stranded passengers are not even provided snacks, tea/coffee graciously even when they are prepared to pay. According to experienced travellers and civil aviation experts, the image of the country will improve only when passengers are treated with care and flights are operated punctually. The mere new and spacious terminals are not the answer. India is one of the oldest civil aviation hubs. But its efficiency is decreased to abysmal low because the attitude of the authorities at the IGIA and other international airports is far from realistic.
	Investor Guidance Post office plans not for NRIs by A.N. Shanbhag Q : I have a few questions about post office investments in India. Can an NRI open new Monthly Income Scheme (MIS) account with post office? Can an NRI open new MIS account jointly with a resident? If a resident has become an NRI after opening the MIS account , say after 3 years, what will be his position if the account is continued as well as if it is discontinued? Where should the maturity proceeds be credited? — D.G.Athale A : Post office investments include MIS, PPF, Term Deposits, Senior Citizens Saving Scheme, NSC etc. All such investments are closed for NRIs. However, if the investment has been made prior to becoming NRI and the person subsequently becomes NRI, then such investments may be continued till maturity. Upon maturity, the proceeds may be credited to the NRO account. Ceiling for PPF Q : I have PPF accounts in my and my wife’s name. We contribute Rs 70,000 in each accounts every year and claim tax benefits. Now we want to open PPF account for my minor daughter (age is 3 month), which will be operated by my wife. I am confused with the rule about the ceiling of contributions. Can my wife contribute Rs 70,000 in each account (self and minor) each year? We do not want to claim the deductions for the amount deposited in minor account. I request you to clarify. — Vinod Bharati A : The combined limit for investment in PPF in your own and minor child’s name is Rs. 70,000. This is so even if you do not intend to claim the tax deduction for the amount deposited in the minor’s account. Education loan Q : My son has completed his 10+2 (Med) and is now aspiring to join MBBS course in Nepal for pursuing his career as a doctor. I have applied for an education loan from a bank but the same is being delayed by the bank on one pretext or the other. May I know if any restriction is imposed by the Reserve Bank of India for extending an education loan to an Indian student studying in Nepal? — I. J. Agnihotri A : There is no problem as far as Income tax provisions are concerned in respect of exemption u/s 80E related with interest on loans taken for “higher studies” for self or relative, undertaken either in India or anywhere else in the world. We are not aware of any restrictions imposed by the RBI on this matter. Mutual funds abroad Q : 1. If a resident individual has investments in mutual funds abroad ( which is allowed), then as per the new DTC will he have the shelter of tax slabs for any Capital Gains (short term or long term) arising out of the funds? Or will he be treated an NRI without the shelter? 2. You have mentioned the rules under the DTC for residential property where presumptive rent is fixed at 6 per cent. Is the same ruling applicable for Commercial property as well? — K.J.Govadia. A : 1. A resident cannot become an NRI in respect of his investments in a foreign country. These capital gains earned abroad do receive the same treatment as the capital gains earned on investments made in India. The code has not changed this position. 2. The income from any house property shall be computed under the head, Income from House property, notwithstanding that the letting, if any, of the property is in the nature of trade, commerce or business. The income from commercial property will be the actual rent received or 6 per cent of the ratable value of the premises, whichever is higher. NRO account Q : What is the procedure for converting Resident a/c to NRO a/c? What are the implications if it could not be done because of ignorance of rules? How can it be done now when NRI is not in India? What are the tax obligations and penalty if any? — R. C. Ahuja A : You need to get in touch with your bank for this. The bank will inform you regarding the paperwork required. Basically, you will need to submit your passport and proof of living abroad (in terms of visa, green card, foreign citizenship etc.) As long as you do not owe any taxes to the exchequer, there are no financial consequences as such. Theoretically, the law prescribes different penalties/ punishments for non compliance but for the lapse of not converting the account, in our experience there has been no penal action. However, it would be advisable to get it done as soon as possible.