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Maran aims to do away with STD
Arrest inflation for better growth: FM
NDA paints gloomy picture of economy
Revenue deficit may go up by .75 pc of GDP: RBI
India to set up diamond trading hub
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Neepco gears up for ‘Bhakra Dam’ in NE
No let-up in steel prices likely, says Assocham
IA offer to Dubai passengers
World Bank lauds pension reforms
WTO talks enter crucial phase
Corporate results
In graphic: State-wise Credit-Deposit Ratio of Public Sector Banks
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Maran aims to do away with STD
Chennai, May 24 Talking to AIR and UNI here, Mr Maran said after correcting the telecom imbalance in Tamil Nadu, West Bengal,
Maharashtra and UP, his ministry’s next move was to do away with the STD system in the country as a whole. “The day is not far off when the STD system is dispensed in the country,” Mr Maran said, adding that efforts were also being made to rope in more customers and enhance the tele-density in the country to 10:5 by 2009. The minister said India would soon be pitching in to get Intel, the world’s largest microchip maker to set up its manufacturing unit in Tamil Nadu. Mr Maran, who is to visit the USA in the first week of next month, would personally push for the Intel project, especially in Chennai, when he meets top executives of the company. NEW DELHI: Amidst the controversy on the issue of entry fee for the 3G spectrum, BSNL said on Tuesday that it was against any “abnormal” charge for the third generation mobile spectrum. “We are against any abnormal charges for 3G specturm. It should be free or at best could be charged normally like the current spectrum charges of 2-6 per cent. 3G may be advanced service for data but buying
spectrum for such services at a hefty entry fee is certainly not worth it”, Mr A.K. Sinha, CMD, BSNL, said.
— Agencies
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Arrest inflation for better growth: FM
Mumbai, May 24 Speaking to industrialists here, Mr Chidambaram said inflation could also result in higher interest rates though there was need for low interest rates to promote growth of the economy. He said its borrowings for 2005-06 would be less than the estimates even as it would work to contain inflation and keep interest rates benign to achieve about seven per cent economic growth. “It is the government’s intention that inflation is kept under control…that interest rates are benign to promote investment,” Mr Chidambaram said. He further noted that inflow of foreign exchange was raising money supply into the country thereby tempting the manufacturing sector to raise prices and thus adding to inflationary pressures. As a part of the government’s attempts to rein in expenditure, Mr Chidambaram said efforts would be made to reduce the government’s borrowing. Attempts would be made to borrow less than the targeted amount set for March 2006, the minister said. “I concede that the government borrowing is a problem ... I am confident that this year also we will borrow less than what was projected,” Mr Chidambaram said. “Demand for (bank) credit will be as good as last year. The key again is investment.” He said: “If inflation is low, borrowings are less and interest rate are benign, then the growth rate would be the same as the last year (close to seven per cent of GDP).” Pressures also exist on interest rates on account of huge government borrowings and credit offtake by businesses for expansion of industrial activity, he said. “There is a huge inflow of foreign exchange and RBI has today absorbed Rs 23,900 crore indicating huge money supply and liquidity in the system,” he added. Mr Chidambaram expressed concern over the high gross fiscal deficit of both the Centre and states and said “both Prime Minister and I are confident that we will do better this year.” Coming down on the manufacturing sector for raising prices at slightest pretext, the Finance Minister said such short-term temptation of the manufacturing sector to increase prices could cause damage to the economy.
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NDA paints gloomy picture of economy
New Delhi, May 24 Inflation, which was 9 per cent after the UPA took over, was ‘’on the rise again’’. The interest rates, which were under pressure, were bound to increase. The petroleum sector was reeling under high
international crude prices with the government “merrily passing on the burden of its subsidy to the public sector petroleum companies and in the process, destroying their balance-sheets,” it said. “As if it was not bad enough, the Finance Minister has restructured petroleum duties in the way which had increased this burden,” the alliance added. The NDA document said the UPA had inherited a robust economy full of potential for further sustained growth contrary to the “messy state” of the economy inherited in 1998 by the United Front Government. The Vajpayee Government had steadily improved the economy with a strong vision and a wide array of ambitious and reform oriented policies and programmes. During its six years in office the GDP growth rate had crossed a morale-boosting barrier of 8 per cent while UPA chairperson Sonia Gandhi had lampooned this achievement as ‘Mungeri Lal ke haseen sapne’. The UPA Government had betrayed the common man, unemployed youth and farmers. The promise made to ‘aam aadmi’ was in tatters because of a price hike in foodgrains, vegetables, milk and medicines, transportation, housing and all other essential commodities and services. The promise of bringing a national employment guarantee act to provide for 100 days of guaranteed employment to one able bodied person among the rural and urban poor and lower middle class household was nowhere in sight after one year. As far as farmers were concerned, about 2000 farmers had committed suicide during the period. The Prime Minister’s visit to Andhra Pradesh had failed to stem the tide of suicides and the situation was no better in the Congress-ruled states of Karnataka, Maharashtra, Kerala and Punjab, it added. On the announcement of Rs 1,73,000 crore “Bharat Nirman” to provide for rural road connectivity, rural electrification, drinking water, telecom and rural housing, the NDA said the ‘’truth was that there was nothing new in this initiative. It was only a repackage of various ambitious projects of the Vajpayee government.’’ The document also lambasted the UPA for treating worthwhile schemes like river-linking programme as a stepchild. The power situation continues to deteriorate while the government debated on amendment to the Electricity Act. The massive shortage in Maharashtra was a direct result of continued neglect of the sector by the state government. The Centre had sought to make up the shortage by denying power to BJP-ruled states, especially Chhattisgarh.
— UNI
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Revenue deficit may go up by .75 pc of GDP: RBI
New Delhi, May 24 “The revenue deficit will increase due to higher devolution in the form of an increase in the states’ share in central taxes, a rise in grants-in-aid to states and other relief measures as recommended by the commission,” the RBI said in its monthly bulletin for May. The first development relates to discontinuance of disinvestment proceeds to finance budgetary expenditure. The second major challenge faced by the Central Government in fiscal consolidation endeavour was to absorb fiscal impact to the tune of 0.75 per cent of the GDP in the revenue deficit due to higher devolution to states as a result of the Finance Commission report.
— PTI
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India to set up diamond trading hub
Mumbai, May 24 Addressing a two-day diamond industry conference here, Mr Nath said the diamond trading centre in India would be on the lines of those in Belgium and Israel. “We will make available al facilities in the trading hub covering all aspects of the diamond industry. The trading centre will be a joint initiative of both the government as well as the industry,” he added. Mr Nath said the work on the diamond trading hub would commence this year itself. “The potential for value addition in the diamond industry is enormous. The companies must identify innovative ways that will create value for all the stakeholders,” said Mr Kamal Nath. Mr Kamal Nath said there was need for Indian gems and jewellery companies to invest overseas and that the government would encourage foreign investments as well as the setting up of joint ventures by domestic diamond
traders. Mr Nath said he would encourage foreign investment in the gems and jewellery sector, which accounts for 18 per cent of India’s exports. “We are quite open to the idea of entering into economic cooperation with the African countries,” he said, adding the cut and polished diamonds have become an important component in India’s exports of gems and jewellery. According to the minister, Indian export across all sectors were on an upward swing. Indian
exports, Mr Nath said, were expected to grow by 15 per cent to $92 billion in 2005-06. According to Mr Kamal Nath, the government was watching the Chinese moves to revalue the yuan following pressure from the USA and Europe.
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Neepco gears up for ‘Bhakra Dam’ in NE
New Delhi, May 24 The 1500-MW project (6 units of 250 MW each), at an estimated cost of over Rs 6,000 crore to completed in seven to eight years, will have water storage capacity of 15.5 billion cubic meter much higher than the Bhakra-Nangal Dam with a storage capacity of 9.6 BMC of water and Narmada Dam with 12.2 BMC capacity. The multipurpose project is expected to help flood control in the Assam region, besides boosting the foodgrain production. It can also give a fillip to regional economy by creating over 10,000 direct jobs. “After getting all clearances from the Ministry of Environment and Forests and Central Electricity Authority (CEA), the project has gone to the Public Investment Board. After that it will go the CCEA for final clearance,” says Mr S.C. Sharma, CMD, Neepco, who has been associated with the Narmada project. Regarding the opposition from the local population, Mr Sharma said: “Unlike Narmada and Bhakra, we will have to displace only about 400 families to acquire 22,000 hectares of land for the project. It will take seven to eight years for the completion of the project, once we get the CCEA clearance.” Various financial institutions have already agreed to finance the project, he added. Ninety per cent of the project area will fall in Manipur and 10 per cent in Mizoram. But Assam will be major beneficiary, as it would help the state to check annual floods in Barak valley in Silchar district. In addition, Manipur and Mizoram will get 12 per cent share in power, that they could sell to the power-starved Northern states at a hefty price. Asked about the impact of the project, as it falls in the highly seismic zone, Mr Sharma said, “IIT Roorkee will be consulted. On the delay in Tipaimukh project, Mr Sharma said: “ We want the Centre to bear Rs 800 crore additional expenses. Otherwise, the power tariff from the project will go up as against expected rate below Rs 2.50 per unit,” he said.
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No let-up in steel prices likely, says Assocham
New Delhi, May 24 “The domestic demand will remain buoyant,” the Assocham Eco Pulse sectoral study on steel said, adding international demand will continue to come from the growing economies of China, US and Europe. Releasing the study, The Steel Surge, Assocham president Mahendra K Sanghi said: “Domestic demand is rising on the back of development in infrastructure and growth in housing and construction sectors. A large number of high rise buildings in metros is having a demonstration effect on other cities as well.” There is slated to be a significant demand growth for steel in India on account of the Commonwealth Games scheduled for 2010. Infrastructure, automotive, capital goods and construction sectors will be the major drivers for growth in domestic demand, according to the report.
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IA offer to Dubai passengers
New Delhi, May 24
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World Bank lauds pension reforms
Washington, May 24 “Regardless of the speed of the transition, the Indian reform represents a fundamental policy shift in the long run, with a non-contributory, unfunded defined-benefit scheme being replaced by a fully funded defined-contribution scheme,” a World Bank study on “Old Age Income Support in the 21st Century” said. It notes that from January 1, 2004, all new federal government hires contribute 10 per cent of their salary to a defined contribution scheme, with a matching contribution from the government as employer. “The mandate applies only to new entrants, but the possibility that those already covered by the old defined benefit scheme may be given the choice to switch is being discussed,” it said. Several state governments, including Andhra Pradesh, Karnataka and Tamil Nadu, it points out, have announced that they intend to join the new scheme, and other states seem likely to follow. While many details of the design have yet to be spelled out, for example, the process of selecting asset managers and the central record-keeper, structure of charges and so forth, the reform stands out because it does not retain an unfunded defined-benefit scheme in the long run.” Regarding investment policy, it points out, the Employee Pension Fund Office in India has undertaken a review of asset allocation, which historically has been concentrated in government-backed securities. The most important reforms in the region, the bank says, are driven by the fiscal burden of civil service pensions. The most ambitious effort to date is the systematic reform in India. State and Federal outlays on pensions now consume around 15 per cent of the tax revenues after doubling over the course of the 1990s. The schemes that cover private sector workers in South Asia, says the bank, are either provident funds (Nepal, Sri Lanka) or immature benefit schemes with a high ratio of workers to pensioners (India, Pakistan). These schemes continue to experience positive cash flows and are a convenient form of government financing through their purchase of government bonds.
— PTI
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WTO talks enter crucial phase
New Delhi, May 24 Mr Menon outlined India’s priorities in the negotiations on agriculture as removal of trade distorting subsidies by developing countries, ensuring adequate protection to the livelihood concerns of poor subsistence farmers, and to safeguard food security, livelihood and rural development concerns. On Non-Agricultural Market Access (NAMA), India wants to address the issues of tariff peaks, tariff escalation in developed countries so that developing countries can access the market in developed countries.
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Apollo Hospitals net up
Chennai, May 24 Bharat Forge
Bharat Forge Ltd today reported 29.40 per cent rise in net profit at Rs 161.63 crore for the year ended March 31, 2005, as compared to Rs 124.9 crore last year. Total income has increased 44.09 per cent to Rs 1226.46 crore for the year ended March 31, 2005, from Rs 851.14 crore in 2003-04, the company informed the Bombay Stock Exchange. The Board of Directors of the company has recommended a dividend of 125 per cent that is, Rs 12.50 per equity share subject to approval of shareholders. The date from which the dividend is payable is August 8, 2005, it said.
Crompton Greaves
Crompton Greaves Ltd has posted a 54.43 per cent increase in consolidated net profit for the fiscal ended March 31, 2005, at Rs 117.12 crore as compared to Rs 75.84 crore in the previous fiscal. Total income during the reporting fiscal increased to Rs 2,017.11 crore from Rs 1,770.20 crore in FY-04, Crompton Greaves informed BSE today. On a stand-alone basis, the net profit for FY-05 rose to 114.78 crore as against Rs 70.83 crore while total income during the period grew to 1999.40 crore (Rs 1738.34 crore).
Balmer Lawrie
Balmer Lawrie Limited, a PSU engaged in the oil services sector, has registered a 60 per cent rise in post tax profit at Rs 29.8 crore during 2004-05 compared to Rs 18.6 crore the previous year. At a meeting held here today, the board of directors had also declared a dividend of Rs 5.50 per share for 2004-05. Net sales of the company had risen marginally by seven per cent at Rs 996.5 crore against Rs 924.4 crore in the previous fiscal.
— Agencies
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Chennai, May 24
