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Cabinet nod for ECGC equity hike
MFN status for pipeline must, India tells Pak
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Iffco seeks control-free incremental production of urea
Reliance scrips plummet
Reliance Director to reconsider resignation
Govt begins drive to widen service tax base
Jet Airways considering IPO
Bharti Shipyard IPO
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Cabinet nod for ECGC equity hike
New Delhi, November 24 Briefing the reporters, Finance Minister P Chidambaram after the meeting of the Cabinet Committee on Economic Affairs (CCEA) here said the increased capital would enable the state-owned corporation, which covers risk of exporting on credit, to provide insurance support to high-risk exports. The funds would also enable the company to own 20 per cent of the stake in the proposed Rs 2,000-crore National Export Insurance Fund (NEIF), the sources said. The corporation’s authorised capital is Rs 1,000 crore. The proposed NEIF, approved in principle by the Finance Ministry, will provide insurance cover to medium and large project exports from the country. The fund is now awaiting the Cabinet nod, ECGC CMD P.K. Daksh had said recently. The Government and ECGC will own the stake in the fund in a ratio of 80:20. The CCEA also authorised ONGC Videsh to invest an additional $ 1.07 billion (in addition to $ 1.7 billion already approved) for the development of phase I of Sakhalin I offshore field. The Cabinet also approved the amendments to Section 13 contained in the Securities Laws (Amendment) Ordinance 2004.The Ordinance will be replaced by a bill, to be introduced in the winter session of Parliament. The CCEA also gave approval for the implementation of National Cancer Control Programme (NCCP) at an outlay of Rs 266 crore during the Tenth Plan. The CCEA separately sanctioned Rs 150 crore as the central share with 90 per cent as grant and 10 per cent as loan for taking up critical flood control and anti-erosion schemes in Brahmaputra and Barak valley by the state governments concerned. After a meeting of the CCEA, Finance Minister P Chidambaram told reporters that the monitoring of the project would be done by the Brahmaputra Board under the Ministry of Water Resources. The meeting was chaired by Prime Minister Manmohan Singh. In a significant decision the government also approved a massive Rs 2,497 crore investment for a hydro-power plant in Arunachal Pradesh to be implemented by North Eastern Electrical Power Corporation Ltd. “The CCEA approved the proposal of Ministry of Power for execution of the Kameng Hydro Power project at a cost of Rs 2,497 crore,” Mr Chidambaram said. He said the project would be implemented by NEEPCO in Arunachal Pradesh. GoM to look at oil regulator, natural gas price hike The government today decided to refer the Bill for setting up of a regulator for oil sector and the proposal to raise the prices of natural gas for fertiliser and power units to two separate Groups of Ministers (GoM). Petroleum Minister Mani Shankar Aiyar told reporters after the meeting of the Union Cabinet that the Bill to set up the Petroleum and Natural Gas Regulatory Board had been referred to a GoM. The Bill is proposed to oversee downstream oil refining and marketing of petroleum products, natural gas sales and transportation and product and gas pipelines. Similarly, the Petroleum Ministry’s proposal to raise natural gas price by 12 per cent for fertiliser and 26 per cent for power units was also referred to a separate GoM. The ministry wanted to raise the price of natural gas from Rs 2850 per thousand cubic metres to a fixed price of Rs 3200 per thousand cubic metres and Rs 3600 per thousand cubic metres to the fertiliser and power sectors, respectively, on a provisional basis. According to reports, the decision to refer the demand of the Petroleum Ministry to the GoM was taken as there was strong opposition from the fertilizer, power and steel ministries. The Bill for setting up the oil regulator had also come in for sharp criticism from Ministry of Chemicals and Fertilisers and Ministry of Company Affairs, particularly on the autonomy of the proposed board, its powers to fix and regulate prices and its capability in fostering competition.
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MFN status for pipeline must, India tells Pak
New Delhi, November 24 In a meeting with the visiting Pakistani Prime Minister Shaukat Aziz, Petroleum Minister Mani Shankar Aiyar categorically said that the project would not be considered in isolation and would have to form part of wider trade and economic relations between the two countries. “We did repeat what we have said earlier about using Pakistan as transit corridor (for sourcing gas from Iran) creating mutual dependency. I said we need to replicate such mutual dependency into several other sectors so that we can conceptualise whatever cooperation we have in the hydrocarbon sector in the wider trade and economic relationship between our countries,” Mr Aiyar told newspersons here after a 45-minute meeting with Mr Aziz. “The project cannot be looked at in isolation. It should form part of wider trade and business relationship and MFN encompasses that,” he said. Mr Aziz is understood to have insisted on going ahead with the project and that MFN status could be discussed as part of the political dialogue. Mr Aiyar said New Delhi wanted the right to use Pakistani territory as transit for bringing gas from Central Asia. Pakistan Foreign Secretary Riaz Khokar said the pipeline project was “a major CBM (confidence building measure) not just for India and Pakistan but for the whole region, including Iran.” Asked if Aziz responded to India seeking MFN status, Aiyar said “this issue is essentially of Commerce Ministry and External Affairs Ministry, so we did not have a discussion on it. But yes, MFN is very much a part of the wider economic and trade issues in which I was attempting to situate the discussion on the pipeline.” “MFN and transit rights are part of the wider trade and economic relations... we cannot consider all these issues separately,” he said. Mr Aiyar reminded Mr Aziz that he had written to his Pakistani counterpart on exporting diesel from India and using Pakistan as a transit for importing gas from Iran, a response to which was awaited. “I am willing to meet my Pakistani counterpart, either in India or Pakistan, to discuss these issues,” he said. On the Iran-India pipeline, New Delhi also wants Islamabad to guarantee security of physical infrastructure - 760-km of the 2775-km pipeline will pass through Pakistan and guarantee for uninterrupted supplies. Iran has been pursuing the pipeline proposal, which will save India millions of dollars in energy cost, with New Delhi and Islamabad since 1996, but tensions between the two countries has blocked any progress.
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Iffco seeks control-free incremental production of urea
New Delhi, November 24 Under the present urea pricing policy, the government is offering subsidy to the producers based on the Group Concession Scheme that has been effective since 2003. It has assessed the capacity of existing domestic urea producing units as 200 LTPA. Mr U. S. Awasthi, Managing Director, IFFCO, said there should be no control on enhancing of the capacity, additional investment, marketing and export of the excess produce bereft of any government obligation for subsidy on such production. Mr Awasthi suggested that the production price control may be restricted to 200 LTPA, currently covered under subsidy scheme and any production over and above this limit by the way of new or expansion of project “should be free of all controls.” Iffco should be allowed to quote against international tenders floated by the government or its nominated state trading enterprises and it should be provided the handling charges against the import requirements at the current rate of Rs 1000-Rs 1500 per tonne as in the case of actual imports, Mr Awasthi said and added in this way “the government could end up saving subsidy on its import requirements.” On the other hand, the Fertiliser Association of India (FAI), representing the industry, is opposed to any reworking of the decontrol as has been taken up by the Chemicals and Fertiliser Minister. Mr Ram Vilas Paswan has raked up the issue of total decontrol of the fertiliser industry. At present, production and distribution of urea (N), a major fertiliser component is under the government control while phosphorous (P) and potash (K) were decontrolled over a decade ago.
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Reliance scrips plummet
Mumbai, November 24 The shares of Reliance Industries Ltd and Reliance Energy closed 2.52 per cent lower at the end of trading on Wednesday though the values of other companies in the group like Reliance Capital and IPCL fell lower. Should the cloud over India’s first business family blow over immediately, it would certainly energise the bulls in the market, according to observers. The markets are still awaiting the reaction of Mr Anil Ambani, who continues to remain silent on the ‘ownership issues’ of the conglomerate, first raised by Mr Mukesh Ambani. Mr Anil Ambani today skipped the World Bank conference on ‘Improving India’s Investment Climate’ where he was scheduled to speak. Mr Mukesh Ambani has already made two public statements saying he is the head of the Reliance Industries empire.
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Reliance Director to reconsider resignation
New Delhi, November 24 “I can not even imagine accepting it (resignation),” Mr Mukesh Ambani said in a statement here. The 72-year-old director, Mr Bhakta, has been on the board of the company since 1977 and said he was resigning because of “advancing age”. However, at today’s meeting, Mr Ambani recalled Mr Bhakta’s association with the company since its first IPO 27 years ago and services rendered by him as a colleague of Founder Chairman Dhirubhai Ambani and as a guide thereafter. “After an exchange of views, Mr Bhakta has agreed to reconsider his resignation,” the statement said.
— UNI
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Govt begins drive to widen service tax base
Ludhiana, November 24 “These surveys are being conducted to identify service providers and to widen the base,” Deputy Commissioner (Service Tax), Central Excise Commissionerate, Ludhiana, Mr Rajan Chaudhary said. The commissionerate has deployed 10 teams, three in Ludhiana, six in Sangrur and one in Ropar, to conduct these surveys. The exercise follows the taxpayer friendly scheme that was launched in October and extended till November, for voluntary registration of service providers without imposition of penalty. “While this scheme is still in force till the end of this month, surveys have been initiated simultaneously to register those who have been reluctant so far to come forward,” Mr Chaudhary said. The commissionerate is expecting a tremendous response from surveys. He pointed out that the service providers must not ignore legal provisions under which non-registration would invite penalty.
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Jet Airways considering IPO
New Delhi, November 24 Naresh Goyal, Chairman of the 11-year old airline, told reporters the company was seriously looking at an initial public offering to improve its balance sheet and would take a decision before the end of December. “Several international banks are advising us,” Goyal said. Jet Airways India (Pvt.) Ltd. has grown rapidly since its founding to grab 43.4 percent of the domestic air travel market, surpassing state-owned Indian Airlines Ltd., which for decades was a monopoly provider of domestic air service.
— Reuters
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Bharti Shipyard IPO
New Delhi, November 24 The issue will open on December 2 and close on December 8. Mr P.C. Kapoor, Director, said, “the issue will constitute 55.56 per cent of the fully diluted post issue paid up capital of the company.”
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The Cabinet today approved the increase in the paid-up capital of the Export Credit Guarantee Corporation of India Ltd
by Rs 300 crore to Rs 800 crore. Briefing the reporters, Finance Minister P Chidambaram
after the meeting of the Cabinet Committee on Economic Affairs here said the increased capital would enable the state-owned corporation, which covers risk of exporting on credit, to provide insurance support to high-risk exports.
