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| Thursday, June 29, 2000, Chandigarh, India   
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MTNL, VSNL sell-off this fiscal year likely
Dot coms: from boom to gloom
Biotech task force to be set up in HP
No
penalty for Haryana
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Expert group
on service tax
Online PAN from Aug 1 ‘Josh’ machines in city It’s state govt vs PSEB over money
MTNL, VSNL sell-off this fiscal year likely NEW DELHI, June 28 — The government was not wanting to carry out large scale privatisation in hurry and would just be allowing medium ticket disinvestment in the initial stages, the Disinvestment Minister, Mr Arun Jaitley said today. Addressing a meeting organised by the PHDCCI and Assocham the minister also pointed to the possibility of inclusion of blue chip public sector units like the MTNL and VSNL in the sell-off list for the current fiscal year. “We (Cabinet) do discuss time and priority for disinvestment and privatisation. We feel that at a suitable time, big ticket privatisation would be required. But till such time, that is, in the initial phases, we feel medium-ticket disinvestment is most suitable.” The Disinvestment Minister announced that the government had appointed global advisers for disinvestment of 10 public sector undertakings (PSUs), and taken on “in principle” decision for such advisers in 7 PSUs. The equity of all these 17 companies will be divested as much as possible in the current fiscal year itself. Mr Jaitley said the Cabinet has advised the respective departments of 11 other PSUs to formulate detailed proposals after which the time-table for their disinvestment will be drawn up. Mr Jaitley said the government would also take up sale of equity of some profit making PSUs to create ‘success stories’ for giving a fillip to the disinvestment programme. He said the government was committed to expeditious implementation of the decisions while protecting employees’ interest and ensuring that the proceeds of divested units are used to restructure PSUs, increase social sector spending and retire public debt. The Minister criticised the dual policies of the political parties, specially in creating scare campaign against privatisation when in opposition, while supporting the same while being in power. “In 1991, the then Finance Minister had announced that a part of government stake would be divested in selected companies. This was followed by successive governments and one of the first 50 companies chosen for privatisation was Air India. Now our policies on the same are being criticised.” The Minister, while responding to the Assocham President, Mr Shekhar Bajaj’s concern over the pace of implementation of the disinvestment programme said, disinvestment and privatisation require both political and economic consensus and assured the gathering that “we are determined to making the programme the art of the possible in a multi-polar polity like India”. Mr Jaitley said the opponents of the PSU disinvestment programme were prone to creating a scare amongst employees and failure to achieve this was followed up by scandalising each transaction. The Minister sought to allay apprehensions on job loss as restructuring of PSUs would make them efficient, and thus prove pro-employees. Assocham President, Mr Shekhar Bajaj said the government seems to have taken pains to avoid the sale of some of the most important and profitable public sector units. There are some factors that raise doubts about such a methodology for disinvestments. For instance, the sale of public sector units will gain the best prices only if these efficient and well-run units are sold to the public. It will be very difficult for the government to secure very attractive prices for the loss making public sector units, which have large liabilities.
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Dot coms: from boom to gloom
SAN FRANCISCO, June 28 (DPA) — This time last year anyone casting doubt on the economic miracle of the Internet was viewed as a hopeless luddite, a financial reactionary or simply a sour-puss upset about missing out on the most incredible economic boom of modern history. But now those naysayers are looking more like prescient economic prophets. Barely a day passes in Silicon Valley without sensational reports of another Internet casualty laying off workers, going bankrupt, or being snapped up by a rival for cents on the dollar. While many of these ailing companies are small outfits that never enjoyed a healthy economic outlook, others were top-rank brands that were widely tapped for Internet glory. Companies such as health site drkoop, video site reel.com and music site cdnow.Com were all Internet stars just a few months ago. Now they seem irrevocably headed to the recycle bin — if they aren’t already there. But this string of failures could not prepare the e-commerce world for the latest dot com casualty. Mighty Amazon.com, the leading online retailer and the company whose founder and CEO was named as Time magazine’s Man of the Year just six months ago, is now on the cyber-sick list. Analysts who were once its most vocal supporters proclaimed that the company was in trouble and predicted that ‘’unless it pulled a magical rabbit out of the hat’’ it would run out of cash by the end of the year. The spate of dot com disasters has had a predictably gloomy effect on the thousands of workers in Silicon Valley who once believed they would effortlessly ride the Internet train straight to the promised land of unbelievable riches. But at the same time it has thrown up several websites which seek to provide support and comfort to the disillusioned workers of the Internet and to poke fun at the very essence of the dot com dream. Foremost among these is the creation of a man who is known online as Pud, but who was born 24 years ago as Phillip Kaplan. A New York-based Internet consultant he showed his ability to see through the dot com hype by launching a site called F — edcompany.com in which people could share their opinions on where the Internet economy was heading. The obscene name is a play on the successful Internet magazine Fastcompany and Kaplan’s web site has since become one of the fastest growing destinations on the web. Much of the success is based on a game that Kaplan used to play with his cynical friends. “You sign in and you pick five companies with problems. You score points when they lay off workers, when their stock goes down and when it goes bankrupt,” said the Peroxide-blond webmaster in a recent interview. “We get over a million hits every day and we’ve only been up for a few weeks. It’s out of nowhere.” The site is also a treasure trove of gossip and news about the companies in trouble. As such it is attracting disillusioned techies, venture capitalists and even headhunters who want an early indication of which companies might be in trouble so that they can poach their staff. Because its participants come from such a wide area of the industry F— edcompany’s predictions are often more accurate and earlier than those of well-connected industry analysts. Days before the experts issued their warnings on Amazon.com, the cynical website had the online retailer as number five in its top 10 companies likely to go under. Other websites are also rushing to cash in on the new pessimism about the new economy. Netslaves.com is another popular forum for new economy workers who slaved away in pursuit of stock options only to find their companies devastated by a mixture of inept management and ridiculous expectations. It was formed by Bill Lessard after he had been through seven companies in seven years and had nothing to show for it. “There’s a lot of anger that comes through our site,” he says. “Companies are going out of business and people are p——ed off.” Another website is startupfailures.com whose main aim is to give failed entrepreneurs the support, resources and insights to pick themselves up and bounce back. Dotcomfailures.com and dot-com graveyard at upside.com are additional variations of the latest trend. But so far none of these popular web sites have attracted venture capital and there is a good reason for that. According to VC insiders, the men who funded the original Internet boom are now averse to investing in Internet sites. They have made their money and run, and other people, many of them private investors who bought into the dot com boom are left holding the losses. The VC’s are now focussing on wireless and voice technology which are being touted as the ‘’next big things’’ and on investing in pure science plays — companies that have proprietary technologies that no-one can copy. “The boom is over,’ said one local headline this week. “Long live the next boom.”
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BADDI, June 28 — The Himachal Government will constitute shortly a task force for giving a push to biotechnology in the state which has the distinction of being the first in the country to set up a separate department for biotechnology. This was announced today by Chief Minister P.K. Dhumal, who was here to inaugurate a unit of M.J. Enterprises. He said entrepreneurs are welcome to set up units in Himachal if which (a) are environment-friendly (b) generate revenue for the state government and (c) provide employment to local youth. The state, he said, provides a congenial climate for the growth of IT and biotechnology companies. Ruling out any incentives, Mr Dhumal said the state government will provide sound infrastructure for the industry. He announced: (a) the foundation stone of a Rs 4 crore ESI hospital at Baddi will be laid in August this year. (b) The 22 km Baddi-Chandigarh road has been cleared by the forest department c) a new industrial estate will come up at Dabota, near Nalagarh and (d) a golf course will be put up here. Mr Rajiv Bhatnagar, CEO, M.J. Enterprises, said the group has floated an “MJ Trust” which will set up a school, an engineering college and medical centres in Himachal.
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No penalty for Haryana
Chandigarh, June 28 — Haryana Finance
Minister Sampat Singh yesterday said that Haryana government’s
compliance for imposing uniform sales tax rates on listed items was
more than 98 per cent, which is one of the highest amongst the states
of India. He claimed that given the compliance level of Haryana, there
was no question of the state facing any penalty from the Union
Government in the form slashing its grants and so on. Talking to the TNS, the Finance Minister said out of 205 items listed for imposition of uniform sales tax, Haryana had refused to comply with the uniform rates regarding only three items, namely, diesel, chemical fertiliser and pesticide. For diesel, the prescribed rate is 12 per cent, while for fertiliser and pesticide, it is 4 per cent. According to Mr Singh, the existing sales tax on diesel in Haryana is 10 per cent, while the existing ST on diesel in Punjab is 8 per cent and in Chandigarh, it is 5 per cent. The market price of diesel in all three states, however, is about the same as Punjab and Chandigarh have to bear some additional expenditures due to transportation and storage charges. If Haryana as well as Punjab and Chandigarh enhance their sales tax on diesel to 12 per cent, it will be cheaper in Haryana compared to its neighbours, Mr Singh said. There is no tax on fertiliser in Haryana, while for pesticide it has imposed ST of 2 per cent. The Finance Minister said that while Haryana was in a strong position to deal with the proposed hike in ST rate on diesel, its Chief Minister, Mr Om Prakash Chautala had urged the Union Government to include chemical fertiliser in the list of zero per cent sales tax items in the recently held Chief Minister’s conference in Delhi, for which he received vociferous support from Punjab Finance Minister Capt Kanwaljit Singh and Himachal Chief Minister Mr Prem Kumar Dhumal. “ What is more important is that nobody had opposed what he said”, the Finance Minister said and added that there was no discussion on pesticide in the meeting. Mr Sampat Singh said that states such as Bihar had zero per cent compliance at the time of attending the meeting, while Pondicherry had only about 50 per cent compliance. The implementation of the uniform sales tax rates were also not satisfactory in north eastern states like Arunachal Pradesh and Mizoram. According to the Finance Minister, it is these states which may attract penalty from the Union Government unless they quickly bring more items under the uniform tax net. Asked whether the state government would eventually impose the uniform rates on diesel, fertiliser and pesticides, the Finance Minister said that he was hopeful about the Union Government accepting Mr Om Prakash Chautala’s suggestions. |
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Expert group
on service tax
NEW DELHI, June 28 — The government has notified the constitution of a seven member expert group headed by Dr Govinda Rao, Director of Institute of Social and Economic Change to examine various aspects related to taxation of services. The other members of the committee are Mr B.C. Rastogi, former Chairman Central Board of Excise and Customs, Mr D.B. Lal, former Member Central Board of Direct Taxes, Mr Ashok Wadhwa, tax expert and consultant, Dr Arvind Virmani, senior Economic Adviser, Finance Ministry and Prof Indira Raja Raman, National Institute of Public Finance and Policy. Mr Sukumar Shankar, Member Central Board of Excise and Customs would be the Member Secretary of the group, which would be headquartered in the capital. According to the Finance Ministry, the terms of the expert group would be to examine the existing structure of service tax and to make recommendations on extending the tax base in the area of service and the timing thereof; to examine the existing procedure for collection of service tax, and to make recommendations as may be considered necessary for making it more effective to augment voluntary compliance, and to reduce compliance cost; and to make recommendations on any other matter related to the above points or incidental thereto. The group would submit an interim report to the Finance Ministry by October 31, 2000 containing such recommendation as it considers important for important implementation. The expert group would submit the final report to the ministry by December 1, 2000. |
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Online PAN
from Aug 1 NEW DELHI June 28- The Income Tax Department will allot permanent account number (PAN) and PAN cards on-line from August 1 this year, the Minister of State for Finance, Mr V.Dhananjaya Kumar said here today. Releasing Compaq Discs (CDs) on direct tax laws brought out by a private concern, Taxmann, Mr Kumar said that steps are being taken to drastically computerised the Income Tax department and added that the number of new assesses was increasing by leaps and bounds after introduction of the one by six criteria. Mr Kumar said that these criteria have been extended to 73 more cities and towns and the IT department was working on further simplification of rules to make it more people-friendly. The Minister of State for Textiles, Mr G.N. Ramachandran said that Income Tax should be allowed to be deposited at petrol pumps and other places as in the case of telephone bills. The Minister released four CDs on tax computation, income-tax rules and forms, direct tax laws and TDS. According to Taxmann, the CDs would do away with the complication of filing tax returns. For instance the CD on Tax Computation authentically and instantly calculates the taxable income and the tax payable thereon. The CDs are priced between Rs 1250 and Rs 1500.
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‘Josh’ machines in city CHANDIGARH, June 28 — There are cars you fall in love at the first sight. One such is a two-seater sports car with fabulous features named IKONcept 2003 displayed at Excel Automotives in the Industrial Area here as part of a three-day Ford G T carnival which began this morning, attracting car enthusiasts from the city. Designed by well-known car buff Dalip Chhabria, it is wider and shorter with pearlised leather interior, 17” wheels, promising safety on a whopping speed of 250 km and giving a thrill that can be enhanced only by the company of a girlfriend. As one starts day-dreaming, the price tag of Rs 14 lakh is enough to bring back the reality and the realisation: why such pretty things are beyond reach. Also on display is IKON GT with a similar “new edge” design and one of the “coolest thing on four-wheels,” designed more for a “family man” or a young neo-rich crazy about gadgets like GPS-based navigational system, leather bucket seats and an entertainment system with VCD and Pop-up TV. This “Zinda Dil Josh” is priced at Rs 9 lakh — making it costlier than Lancer and Nexia. To put more life into the carnival, the local Ford dealer plans to hold a painting competition and a quiz for all age groups on Friday, offering prizes like T-shirts and caps. Such was the pull of IKON GT that Parminder S. Gill, Deputy GM, had a tough time convincing a lady — the wife of a tax commissioner — that the two Josh machines were not for sale. IKON GT will be in the market next year, while the two-seater will be available in 2003. Ford India is displaying them to gauge customer response.
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ItIt’s state govt
vs PSEB over money CHANDIGARH, June 28 —Electricity duty (ED) has become a bone of contention between the Punjab Government and the Punjab State Electricity Board. The state government authorities have repeatedly urged the PSEB to clear the ED dues worth Rs 300 crore but the PSEB is dilly-dallying on the issue. Informed sources said that the PSEB wanted that the state government first pay the accumulated grant in aid to the tune Rs 780 crore in lieu of the free power to the farming sector. The Punjab Chief Minister, Mr Parkash Singh Badal had announced in the Punjab Vidhan Sabha that the State Government would fully compensate the board for giving free power to farmers. The state government owes Rs 778 crore to the Board accumulated over the past three years as Mr Badal had stated in the House that the annual revenue loss to the board for free power to the agriculture segment would be Rs 226 crore. The issue is expected to be taken up by the PSEB Engineers Association with the Punjab Governor on July 4 when its six member delegation will apprise him of the deteriorating financial position of the board. Electricity duty was levied by the Punjab Government and collected through the PSEB while realising power bills. The board is supposed to deposit it in the government treasury on the 10th of every month and an intimation in this connection has to be sent to the Chief Electrical Inspector, Punjab. The board was supposed to deposit about Rs 450 crore of the past three fiscal years but it had paid only Rs 108 crore so far. The budget estimate of the state government for the current financial year is Rs 135 crore and the board has not paid a single penny from the duty collected during the current financial year so far, it is learnt. The PSEB had urged the state government to consider the ED Rs 195 crore, which was due till year199a7-98 as loan against the Board. However, the State Government has not conceded this request but it also did not insist on paying the same. The Punjab Government is contemplating to enhance the ED. It is expected to be levied at the rate of 5 per cent on the sale of power(SOP). If calculated after the proposed revision of the power tariff it would be around near 13 paise per unit against the existing rate of 11 paise per unit for commercial and industrial units. Sources said that the government would fulfill its commitment of paying Rs 200 as grant in aid by asking the board to retain the ED which if jacked up would be to the tune of Rs 175 crore against existing about Rs 135 crore. Mr Badal while interacting with the top brass of the Board and representatives of the Industry regarding tariff hike had promised to give a grant of Rs 200 crore from the State Government treasury to meet a part of the increasing commercial loss of the Board.
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Pollution Safety award WWICS Kotak Mahindra Mukta Arts Greaves in red
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“We have no intention to cut prices of our small car Indica or offer any discount on the model,” says Tata Engineering General Manager (Commercial) Rajiv Dube. The company does not want to involve itself in the process as “price-cutting is a never-ending game.” Reacting to Maruti’s recent announcement to cut prices of Maruti-800, Omni and Wagon-R up to Rs 25,000, Hyundai Motor India Executive Director J.H. Kim said: “There will not be any price reduction in case of our small car Santro.” “Santro model is very well accepted in the market. We do not need any price cut or offer incentives to boost sales of the model,” Kim said. The price cut effected by Maruti Udyog was mainly due to its internal problems, including poor response to the recent launch-1100 cc car Wagon-R, he said. Fiat India spokesperson said the company’s Uno and Siena are “not overpriced”. Therefore, there is no question of a cut in prices. “Fiat has decided against cut in prices because it is not good from the customers’ point of view and brand image of the company,” the spokesperson said. A Daewoo spokesperson also ruled out any downward price revision of its small car Matiz saying the model is the best selling car of the comp Korean auto major. — PTI How to improve
milk quality Milk powder manufacturers will now use a specific process called “spray drying” to enhance its solubility. Moisture content level in milk powder has been reduced and a number of other quality modifications including those for absence of microorganisms like “salmonella” and “shegella” have also been introduced. A new parameter assesses the level of total acidity permissible in products like sweetened condensed skimmed milk powder and partly skimmed milk powder. In future, the milk quality will be assessed by an “insolubility index”, which is considered a better criterion for such assessment. — PTI ‘Take jeep to
protect us’ R.K. Rewari, President of the BBN Industries Association, presented the keys of a new Mahindra jeep to the Chief Minister and urged him to upgrade the local police station, besides creating a post of DSP at Baddi to meet the deteriorating law and order situation in this industrial area. — FOC Fed may not touch rates The Fed has raised interest rates six times in the past year to their highest level in nearly a decade in an effort to slow the booming U.S. Economy and head off inflation. But this time, Fed Chairman Alan Greenspan and his colleagues are armed with a growing stack of data showing their efforts might finally be working. — Reuters
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