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RBI, Finance Ministry peg higher inflation rate
EU defends outsourcing
Gail, Tata Power, BP tie up
Lockout at Samtel unit in Parwanoo
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Indian Airlines may land in black by year-end
Tax relief for development finance firms sought
New magazine for franchise, retail industry
Eicher demerger plan gets nod
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RBI, Finance Ministry peg higher inflation rate
New Delhi, March 25 Top Finance Ministry
officials revised upwards the inflation rate for the current fiscal,
pegging it in the region of 4.7 per cent. However, they said there was
no cause of alarm and the situation was manageable. “The inflation
rate would be less than 5 per cent and could be in the region of 4.7 per
cent,” the Chief Economic Adviser to the Finance Ministry, Mr Ashok
Lahiri, told reporters here. Finance Minister Jaswant Singh had stated
in his Interim Budget speech that the inflation rate for the fiscal
would be between 4 and 4.5 per cent. Meanwhile, RBI Governor Y.V.
Reddy, who had also forecast this level of inflation earlier, today told
reporters in Mumbai that the inflation rate would be between 5 and 5.5
per cent. Dr Reddy as well as Dr Lahiri attributed the upward revision
in the inflation rate, as measured by the Wholesale Price Index, to the
spurt in international commodity prices, which had hardened by 20 per
cent. However, Dr Reddy also said there were enough cushions in the
economy to tackle any unwarranted situation. “Liquidity conditions
are easy,” Dr Lahiri said but admitted that hardening of international
primary commodities prices would have an adverse impact on the Indian
economy. He said the macro-economic fundamental of the economy were
strong but parried questions whether this would lead to the hardening of
interest rates. Dr Lahiri said: “On a point-to-point basis, the
inflation rate would be lower than last year,” he said. Talking about
the rise in prices of sugar in global markets, Dr Lahiri said the weight
of sugar in WPI was small. “It is manageable. I would not be
worried,” he said. When asked to comment on apprehensions in the
markets that the interest rates would go northwards, Dr Lahiri said in
that case, the private sector should undertake borrowings to make
investments. — UNI
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EU defends outsourcing
New Delhi, March 25 Expecting economic growth
of the EU to be in the range of 2-3 per cent this fiscal, European
Commissioner for Enterprise and Information Society Erkki Liikanen told
mediapersons here that it is much tougher to defend open trade when the
growth is low. ''Hopefully, India will be growing at a much faster rate.
So it is not difficult for it to open trade much more.’’ Advocating
reciprocity of trade between the nations, Mr Liikanen said any
politician is challenged by many factors in his constituency and when he
is questioned that jobs are being moved to those countries which have
restrictive trade structure, he succumbed to pressures. ''We say when
we lose lower-end jobs, we should have much more market access for
high-end products.’’ When asked as to what does he expect India to
do in exchange of outsourcing from the EU, he said it’s a matter to be
discussed by EU Trade Commissioner Pascal Lamy but the general principle
must be of reciprocity. Taking dig at the rising backlash against
outsourcing in the US, which many analysts say are due to the heightened
campaign for the Presidential election, the EU official said despite
elections being held at many levels almost every day in the union the
outrage against shifting of jobs is not as pronounced as in the United
States. — UNI
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Gail, Tata Power, BP tie up
New Delhi, March 25 “We will sign a tripartite collaborative agreement
before the end of this month,” a senior GAIL official said here.
Though the three companies are yet to decide on how much each one will
hold in the consortium bidding for Enron’s Indian assets, they have
broadly reached an understanding that GAIL, if they win the bid, will
operate the 2.5 million tonne LNG import and regassification facility at
Dabhol while Tata Power will run the 2,184 MW power plant. BP is
interested in supplying liquefied natural gas (LNG), they said.
Foreign shareholders had offered to sell the stalled $ 2.9 billion
project for which there are four prospective buyers — the consortium
of Tata Power, BP and GAIL; Reliance Industries Ltd; BG Group Plc; and
Royal Dutch/Shell. Enron owns 65 per cent of Dabhol, while General
Electric Co and privately held Bechtel group Inc each own 10 per cent.
Maharashtra State Electricity Board — the sole buyer of the power
generated by the project — holds the remaining 15 per cent of Dabhol
Power Company, which set up the 2,184 MW plant. — PTI
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Lockout at Samtel unit in Parwanoo Parwanoo, March 25 A TNS team, during its visit to the unit today, found that lockout
notices had been pasted outside the main gate, denying workers entry to
the premises. Treasurer of the Samtel Workers Union Sunil Kumar said
the dispute between the union and management was over the revision of
wages. As per the agreement between the two, the wages of the employees
had to be revised every three years, but there had been no such revision
after July, 2000. While the management was firm on its stand of linking
the wage revision with a threefold increase in productivity, the workers
maintain that this was not part of the agreement. The irked workers
today assembled in front of the factory. They were protesting against
the management's decision to suspend 14 employees and chargesheet 36
others on March 17 for allegedly not obeying the company's rules. They
alleged that not only some of the machines had taken out from the
premises but the management was also taking work from the employees on
contract elsewhere. In fact, they had stopped giving them work since
March 15. Then they reported the matter to the local police when the
machines were being taken out on the pretext of repair. SHO Shamsher
Singh denied that the workers were beaten by some bad elements. One
worker disclosed that the production of the component was underway at
Vinay Industries, Datiar, and Essel and Metronic groups at Parwanoo. The
help of a posse of outside security agency was finally taken to effect a
lockout on March 22. When the workers of the third shift tried to get
in, they were denied entry. Business Head of Samtel Colour Alok
Chatterjee said the company had been negotiating wage revision in terms
of the productivity keeping in view the competition. While the workers
agreed to improve their productivity, but they were declining to sign
any agreement with the management in this regard. While an official
of the management said the workers were given an increase of Rs 193 in
the DA and an increase of Rs 20-40 in the wages in July, 2003 , the
workers said the nominal hike in wages was as per the Minimum Wages Act
and the management had no role to play in it. Mr Chatterjee said
following the intervention of the Labour Commissioner, Shimla,
negotiations were on between the management, the workers union and the
Deputy Labour Commissioner to find an early solution to the problem.
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Govt to promote organic farming in Himachal New
Delhi, March 25 Speaking at a three-day National Conference on Organic
Farming for Sustainable Production, Chairman of the Farmers’
Commission Som Pal called for adopting an eco-friendly technologies in
the agriculture sector. The conference has been organised by the
Horticulture Society of India in collaboration with the Indian
Agricultural Research. Mr Som Pal said at present, the area under
organic farming in the country is estimated to be about 2.5 lakh
hectares covering fruit crops like pineapple and banana, vegetables and
oilseed crops such as mustard and groundnut. In case of foodgrains,
organic wheat is grown over small areas primarily for meeting export
needs. The worldwide market fruits areexpanding at an annual growth
rate of 15-30 per cent over the past three years. The present global
market is estimated at Rs 26 billion. The share of India so far was only
a negligible Rs 89.42 crore.
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Indian Airlines may land in black by year-end New Delhi, March 25 The revised estimates of the airline, which were approved
by its Board of Directors at a meeting here yesterday, indicated a net
loss of Rs 41.25 crore, which is a great improvement over the loss of Rs
196.56 crore incurred in 2002-03, an IA release stated. Indian Airlines
has been incurring losses for the past three years, primarily due to a
massive hike in the price of aviation turbine fuel (ATF) since March,
2000, and in the aftermath of events such as the September 11 terrorist
attacks in the US, outbreak of SARS and the Iraq war. “While the ATF
prices were largely stable between 1996 and March, 2000, varying between
Rs 14,500 per kilolitre (KL) and Rs 15,200 per KL, it rose to Rs 18,000
per KL by the end of March, 2000,” the release said, adding that by
September, 2000, prices of ATF shot up to Rs 22,500 per KL. Even after
deregulation, prices of ATF continued to be substantially higher than
the pre-revised price of Rs 15,200 per KL in March, 2003, the price of
ATF is hovering around Rs 21,500 per KL now. During 2003-04, Indian
Airlines rationalised some of its flights by delinking Rajkot-Vadodara
from Mumbai-Rajkot-Vadodara-Mumbai flight and provided direct connection
to both Rajkot and Vadodara from Mumbai on daily basis. According to
the release, the financial year 2004-05 is expected to be better than
the financial year 2003-04 due to improvement in traffic and general
health of the economy coupled with anticipated increase in capacity and
consequent improved utilisation.
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Tax relief for development finance firms sought New Delhi, March 25 “There are thousands of mid-sized Indian companies today
looking for fresh investments for which they need long-term competitive
finance. If a portion of long-term funds, such as provident fund,
pension, gratuity and postal savings, is made available to the DFIs, it
will facilitate better corporate financing”, the President of the
Federation of Indian Chambers of Commerce and Industry (FICCI), Mr Y.K.
Modi, said. According to a survey conducted by FICCI on long-term
financing needs of the Indian industry and the role of DFIs, the
industry felt that long-term debt market should be developed so that in
future, the market is in a position to support these institutions. The
DFIs should also be given tax concessions with respect to their bond
issues and be exempted from tax on their profits, it said. The survey
elicited response from 248 companies of various sectors and 89 per cent
of the respondents said they had plans for fresh investments in near
future. The low levels of activity of the DFIs has given rise to
concerns within industry, with as many as 73 per cent of the respondents
saying the DFIs have not been very active in the past five years.
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New magazine for franchise, retail industry New
Delhi, March 25 Franchise Plus Editor Vinod Behl said the retail and franchisee
business in the country was witnessing a healthy growth and the magazine
would help the people, especially those in small cities, stay abreast
with the latest developments and business opportunities. “It is a Rs
10,000-crore industry and witnessing a growth of 20 per cent,” Mr Behl
claimed. The content plan of the magazine includes quantitative and
qualitative surveys, success stories of franchisers and franchisees,
sector analysis, latest franchising and retail news and retail estate
news and analysis, he said.
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Eicher demerger plan gets nod
Mumbai, March 25 Under the scheme, the automotive business of Eicher
Ltd will be demerged into Eicher Motors Ltd (EML). The tractors,
two-wheelers, gears and engines business of Eicher Ltd will be demerged
into Eicher Motors. The restructured entity was expected to have
synergistic benefits on account of potential cost savings in many
operational areas. The additional shares to be issued in Eicher Motors
Ltd (the resulting company), for the demerged undertaking, will be
issued in the ratio of two equity shares of EML for every five equity
shares of Eicher Ltd. The approval by shareholders was given at the
court-convened meeting of the equity shareholders, secured creditors and
unsecured creditors of the Company held on March 20, 2004. Further, at
the EGM of the equity shareholders of the company held on March 20,
2004, the shareholders had unanimously passed the resolutions approving
reorganisation and reduction in the capital of the company and delisting
of the securities from the Ahmedabad, Bangalore, Kolkata, Chennai and
Delhi stock exchanges.
Bharti to raise $100 m
The Board of Bharti
Tele-Ventures has decided to raise funds by issue of Foreign Currency
Convertible Bonds (FCCBs) up to $100 million for the purpose of meeting
capital expenditure. Informing the BSE, the company said this FCCB
issue will also include a greenshoe option of retaining additional $ 15
million. However, the FCCB issue is subject to the approval of
shareholders of the company and other statutory approvals as may be
required.
Moody’s changes Tata Motors’ outlook
Moody’s today
retained the ‘Ba2’ rating on Tata Motors Ltd’s debt paper but
changed its outlook to “positive” from negative. The change in the
outlook was prompted by strong improvements in the Tatas’ operational
performance since 2001, evidence of strengthening free cash flow, a
significant debt reduction resulting from stronger cash flows and a 50
per cent conversion to equity of the company’s $ 100 million
convertible bond. It was also prompted by the expectation that the
company will consolidate its strong market positions, bolstered by
acquisition of Daewoo Commercial Vehicle Company Ltd.
Crisil
acquires 9 pc stake in Caribbean firm
Crisil Ltd has picked up a 9 per
cent strategic stake in the Caribbean Information and Credit Rating
Agency (CICRAL) for $ 3,00,000. Crisil will provide technical
assistance to establish and stabilise operations of the new rating
outfit. Mr R. Ravimohan, Managing Director of the rating agency, will
join the board of CICRAL, which is the world’s first regional credit
agency, Crisil said in a release here today. The Caribbean initiative
comes in the wake of major forays like acquisition of UK-based
Economatters Ltd and strategic investment in National Commodity and
Derivatives Exchange Ltd, the release said. — UNI, PTI
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