New Delhi, March 7
Political parties failed on Thursday to agree on how to compensate farmers for land acquired for infrastructure and industrial projects, dashing market hopes of a breakthrough.

The government wants Parliament to pass a bill aimed at speeding up dozens of major projects throttled by the country’s notoriously slow land acquisition process, at a time when the economy is in sharp slowdown.

The land acquisition bill proposes to overturn land ownership laws that date back to the 19th century and is seen as a potential vote winner for the ruling Congress party, which faces a general election in just over a year's time.

The cabinet approved the bill in December, but it still faces opposition in parliament and has already undergone about 160 amendments.

Shares in real estate firms had risen up to 11 percent in the run-up to Thursday's all-party meeting, a rise that several traders attributed to market hopes of a consensus.

Businesses fret that the bill will raise project costs. The law could oblige them to pay up to four times the market price for land in rural areas and twice the market price in urban areas, and give displaced people homes and jobs.

The bill also requires four-fifths of all the landholders to agree to the sale to a company before any land can be acquired.

"The meeting is inconclusive," said Parliamentary Affairs Minister Kamal Nath after the meeting. "This is an important piece of legislation. We are trying to evolve as much consensus as possible, if not unanimity."

The government wants parliament to approve the bill during the current session, which ends on May 10. However, the Trinamool Congress (TMC), a powerful regional party, opposes the bill on grounds that the government should not get involved in land acquisition at all.

Left parties want the bill sent to a parliamentary standing committee for further consultation, given the large number of amendments.

In theory, Prime Minister Manmohan Singh's government does not need cross-party consensus to push the bill through. But it has typically tried to find as much agreement as possible for politically sensitive legislation.

Investors say that while the bill is likely to raise project costs, it will also bring policy clarity to the process of land acquisition.

Market watchers say the bill, once passed, will likely boost the share price of companies like DLF Ltd, India's largest real estate developer, Sobha, Unitech and Prestige, which own large tracts of land. — Reuters

New Delhi, March 7
The entry of first foreign airline in Indian skies-Air Asia-is expected to signal the return of good times for air passengers battling arbitrary and predatory fares, more so after the grounding of beleaguered Kingfisher Airlines.

Experts believe the “professionally-run” budget carrier will bring several good practices to Indian aviation with some real low cost benefits for passengers. Perhaps, Air Asia operations may also set an example for those struggling to operate in an high-cost environment like India, they feel.

AirAsia CEO Tony Fernandes has already said that pricing and costs are two major factors for airlines in India and the purchase price of tickets will be the number one differentiator among airlines and apparently the airline is considering offering fares as low as Rs 1,000 on select routes.

Aviation expert Jitendra Bhargava says operating costs in India may be high but they certainly cannot be recovered from passengers. What has been happening so far is that even though airlines have been designated low-cost carriers, their fares are not really low when compared to full-cost carriers, which means benefits they received as an LCC were not being passed on to passengers.

“For example, LCCs operating out of Terminal ID of the Delhi airport pay less to the airport operator than full cost carriers and their low cost arms do when flying from the IGIA’s T3. But they (LCCs) don’t pass on the benefit to passengers which they will have to once Air Asia starts flying,” said Bhargava.

Incidentally, private carriers Jet Airways and now defunct KFA have complained many times to the government that they were being charged higher rates at T3 even as domestic rivals IndiGo, SpiceJet and GoAir got away with lower charges at T1D.

The initial strategy appears to be to steer clear of high-cost cities like Delhi and Mumbai and keep the cost of operations low. Based in Chennai, the new airline would initially concentrate on destinations in South India where it already operates and branch out to other regions at a later stage. “It will be a calibrated growth,” Bhargava said.

As the airfare war gets going with the entry of another player in the field, there are others waiting in the wing and mergers and acquisitions are now expected to pick up in the sector.

AirAsia will be the first foreign carrier to enter India's aviation sector since the government changed its rules in September last year to allow foreign carriers pick up to 49% stake in domestic airlines.

The Foreign Investment Promotion Board on Wednesday clearedAirAsia’s proposal to launch a new airline in partnership with the Tatas and Telestra Tradeplace. AirAsia, through its operations based in Thailand and Malaysia, flies to south India from several destinations in Southeast Asia. 

Jalandhar, March 7
Punjab Industry Minister, Anil Joshi failed to keep his date with traders from Pakistan and Punjab on the first day of the Indo-Pakistani International Trade Expo, organized by the PHD Chamber, here on Thursday. The fair is aimed at promoting trade and cultural ties between the two neighbours.

Both the organizers and participants were visibly disappointed after Joshi cancelled his visit at the inauguration of the five-day fair. While Pakistani folk singers enthralled a thin gathering, nonvegetarian stalls in the Pakistani food court attracted a steady stream of visitors.

Pakistani stalls showcasing apparel, healthcare products, artificial jewellery and dry fruits from Kabul drew a large number of female customers. Over 40 traders from Pakistan are exhibiting their products that include onyx marble, Kashmiri carpets, home appliances, high-end leather bags, crockery and quilts, besides wrought iron furniture and artificial flowers.

Khursheed Barlas, CEO of Pakistan World Trade & Expo Centre, said bilateral trade between Indian and Pakistan posted a jump of 66% over the last year. “Such exhibitions will help in further boosting business across the border as also bilateral ties”, he noted.

PHD Chamber regional director Dalip Sharma said an exhibition in Ludhiana held last month evoked a huge response with an estimated 50,000 visitors. The traders plan to hold similar fairs in other cities also.

New Delhi, March 7
Telecom Minister Kapil Sibal said the government will try to start national free roaming for customers before October this year. "TRAI has floated a consultation paper on it (national free roaming). So when TRAI's recommendations come and after that, we will try to start free roaming before October," Sibal told reporters here on Thursday.

In December, the Telecom Regulatory Authority of India had floated a preconsultation paper seeking inputs from stakeholders on tariff for national roaming services.

It sought views of stakeholders on aspects of national roaming services like the cost components of call rates to be considered, the manner of cost recovery in case incoming calls are to be made free, the tariff for video calls and SMS while roaming, need for permitting special tariff vouchers for roaming customers.

At present, telecom operators have to pay various charges like termination and interconnect charges, for completing calls of their customers on to other networks, which get added to the final cost of the call for the customer.

On the EGoM allowing Norwegian telco Telenor's Indian arm to adjust Rs 1,658 crore licence fee it paid in 2008 against the final price it has to pay for buying spectrum, he said the decision held good for other firms also.

The minister also launched the National Internet Registry (NIR), which will reduce the cost of processing IP (Internet Protocol) addresses. — PTI

Malmö, Sweden, March 7
Without a willingness to lug cheap flat-pack wardrobes home and wrestle with self-assembly, there would be no IKEA, but in Asia, where the locals have other ideas, the Swedish furniture giant thinks it still has a bright future.

As it expands in China and prepares to break into India, IKEA chief executive Mikael Ohlsson trusts that its core concept, influenced by painstakingly acquired local knowledge, will, over time, give it an edge.

"Most people don't really know and can hardly imagine that we visit thousands of homes round every store in the world every year," he told Reuters at a store in Malmo in southern Sweden.

"We sit down in the kitchen and talk to them ... That's the way we try to learn and understand. 'What are you annoyed with? What are your frustrations? What would you like to have? How much can you afford? What are your alternatives?'" he said.

The group has already taken its huge out-of-town stores packed with modern Scandinavian style to 26 markets, with the product and experience instantly recognizable across them all. But as it ventures further afield, it is tweaking its range and showrooms and adding services to accommodate new cultures.

One size doesn't fit all. In regions where apartments have smaller rooms, its showrooms have to be smaller. A sample balcony exhibit will be kitted out differently in northern China, where balconies are widely used for food storage, than in the south, where they often double as laundries.

Beds are bigger in the United States, but mattresses are firmer in China. And while stores will continue to carry about 10,000 products, the bulk of them from its standard range, the company stocks rice cookers and more chopsticks in the latter.

"As we become more and more global and we expand more in China and we grow into India, we will need, probably, to have a wider range," Gillian Drakeford, IKEA's China retail chief said.

"Then each country will be able to secure relevance by taking the part they really need. But of course we will still secure IKEA's identity."

UNDER ONE ROOF: In developed markets, IKEA is positioned as a low-priced mass-market brand, but in emerging markets where low prices are the norm, it targets a growing middle class that aspires to international lifestyle products. For these customers, design and a comprehensive range under one roof are the attraction. — Reuters

Mumbai, March 7
The Reserve Bank of India said it would reply to queries raised by various organizations regarding the final guidelines for new bank licenses to be issued by it.

In a statement issued on Thursday, the central bank said it had received a number of queries from entities that intended to apply for the licenses ever since the guidelines were issued last month.

"The RBI has been receiving queries from prospective applicants seeking clarifications on the guidelines on licensing of new banks in the private sector," the statement said. It went on to say the central bank welcomed queries and asked prospective applicants to send their questions by April 10.

The statement added replies would be posted on the RBI website and that the bank would protect the confidentiality of the applicants. The RBI has, however, not stated any deadline for it to reply. It will be receiving applications for new bank licenses till July 1.

A number of industrial and business groups including the Tatas, Birlas, Mahindras, Anil Ambani, several NBFCs and even state-owned firms like Life Insurance Corp and India Post have evinced their interest to apply for the licenses.