New Delhi, December 31
Despite slowdown in manufacturing and sharp fall in exports, the Centre today asserted that the GDP growth of the country would remain close to 9 per cent during 2007-08.

“We are not changing the growth projection. The GDP growth would remain close to 9 per cent during the current fiscal… The GDP averaged at 8.6 per cent in the past three fiscal years,” union finance minister P Chidambaram told newspersons after inaugurating the 7th Microstat branch of Indian Bank here.

Remaining optimistic on sustaining the growth rate at 9 per cent in the next financial year (2008-09), the finance minister asserted that it would need more hard work from farmers, businessmen, service sector players and most importantly state governments.

“Outlays are going to be large, but to translate outlays into outcomes, hard work needs to be put in by farmers, businessmen, service sector players and state governments,” he said.

Earlier, addressing the gathering at the branch inauguration ceremony, Chidambaram emphasised that banks have to play a crucial role in empowering the poor and women by extending them credit.

“Poor people and especially women need to be encouraged to open bank accounts and should be extended credit to enable them to stand on their own legs,” he said noting with happiness that the largest self-help groups (SHGs) of 30 lakh in the world are in India, which are playing an important role in bring the poor into the credit access system.

“It was Indian Bank which started the idea of having exclusive Microstat branch for poor and the needy and now this has become a national scheme. Even private sector banks are entering the micro-finance sector as they are seeing lot of opportunity,” he said, pointing that “this bankable segment is diligent, loyal and faithful in repaying the loans.”

“The repayment in micro-finance sector remains as high as 98 per cent to 99 per cent,” he said.

Chidambaram wanted that every household should possess a bank account and should feel confident to approach banks for credit. “This kind of Microstat branch, I am sure, would help in this count,” he said.

Indian Bank, which launched its first Microstat branch in Chennai couple of years back, has already opened seven such branches across the country and has plan to open another three such branches in the current financial year, M S Sundara Rajan, Indian Bank’s chairman and managing director said.

New Delhi, December 31
Car market leader Maruti Suzuki India (MSIL) will draw curtains to one of its most successful models on Indian roads — Maruti Esteem — with production for the car coming to a stop after the company resumes operations at its Manesar plant on January 2. The model will be replaced by sedan variant of popular Swift.

Informed sources told PTI that the company would stop production of Esteem once it resumes operations at its Manesar plant after a week-long maintenance shut down. Maruti Suzuki is likely to roll out the new Swift sedan on Indian roads by March 2008.

The 1.3 lt petrol engine powered Esteem has been on Indian roads since 1994 and the company sold over 1,000 units of the car in November.

The company would initially launch a petrol variant of Swift sedan sporting a 1.3 lt engine and is likely to introduce a diesel powered version later in the year.

"Maruti is already constrained with supply of diesel engines as demand for Swift diesel, the only diesel powered car in its stable, outstrips supply and launching a diesel Swift sedan would not make sense at this time," sources added.

The company has a manufacturing capacity of 1 lakh engines per annum at its Manesar plant which is being increased to 3 lakh engines.

MSIL's first-ever sedan on Indian roads was the Maruti 1000 which was given a higher engine and rechristened as Maruti Esteem in 1994.

Esteem production was cut from an estimated 1,533 units in April, to just 497 units in November. The production for the model was, however, increased to 1,903 units in August to build up an inventory.— PTI

New Delhi, December 31
In what could be another blow to existing GSM mobile operators, the government may soon demand return of excess spectrum held by them beyond eligible limit.

The move comes after the government last week decided to allot additional spectrum based on telecom regulator TRAI's subscriber linked criteria and GSM lobby Cellular Operators Association of India (COAI) accepted the decision.

Going by TRAI norms, which suggested up to six times more subscribers to become eligible for additional spectrum, the operators may end up holding excess airwaves. These surplus airwaves can accommodate 4-5 new players, sources said.

DoT has already conducted a detailed study of all GSM players with regard to their subscriber base and equivalent spectrum they hold.

Most existing GSM players have 10 MHz of spectrum in major cities like Delhi and Mumbai, sources said.

Since new spectrum quantity would be decided as per TRAI formula the operators would have to return excess airwaves in many circles, they added.

However, no decision has been taken on whether DoT would enforce the rule that spectrum beyond 6.2 MHz would not be allocated, the sources said.

At the same time, DoT has begun the process of revising spectrum usage charges to maximise the revenues to the government.

The Telecom Commission has been given 15 days to complete the exercise to rework the charges.

Sources also denied that the report of Telecom Engineering Centre has been completely rejected while accepting TRAI's recommendations. — PTI

New Delhi, December 31
Business confidence of the Indian industry has picked up for the period October-March 2007-08 after a decline during April-September 2007-08 and the GDP growth for the current fiscal would be around 9 per cent, said CII’s 68th Business Outlook Survey.

CII’s business confidence index (CII-BCI) at 66.3 was higher for the period October-March 2007-08 with an increase of 2.4 points as compared to the previous business confidence survey for the period April-September 2007-08.

However, the Business Confidence Index is down by 5.5 points when compared to the corresponding period last year.

The CII-BCI, constructed as a weighted average of the Current Situation Index (CSI) and the Expectations Index (EI), was higher among the non-manufacturing firms (68.3) engaged in provision of services as compared to manufacturing firms (65.1).

The CSI that compares current business conditions has witnessed a marginal increase of 0.2 points for the period October-March 2007-08 when compared with the previous six months.

However, when compared to the corresponding period last year, the CSI is down 6.3 points, thus reflecting a decrease in current business sentiments.

This reflects that a larger number of responding firms have not appraised better current conditions for growth of the overall economy, the sector in which they operate and their individual company growth performance to be no better compared to the previous six months, April-September 2007-08.

The EI that reflects the perceptions of Indian industry with regards to performance of their company, sector and the Indian economy for the period October-March 2007-08 gained 3.5 points over the first half of the current financial year, reflecting higher expectations in terms of performance during the second half of 2007-08.

However, the EI for second half when compared to the corresponding period last year is actually down by 5 points reflecting a lower growth expectations of GDP and other aggregates during 2007-08.

The CII survey revealed that GDP growth for the year 2007-08 is expected to be around 9 per cent. This was revealed by 59 per cent of the respondents and of these 22 per cent of the respondents expect the GDP growth to be in the range of 9-9.5 per cent.

The survey also revealed that 87 per cent of the respondents plan to increase investments during October-March 2007-08.

The second half of 2007-08 is expected to be better in terms of increase in new orders as 75 per cent of the respondents expected new orders to increase in the next six months, while about 61 per cent of the respondents revealed that new orders had increased in the first half of 2007-08.

On exports, 67 per cent of the respondents expressed confidence in exports expansion for the period October-March 2007-08. While 53 per cent of the respondents revealed that exports had increased during April-September 2007-08, 88 per cent of the respondents felt that the procedural delays have not reduced.

New Delhi, December 31
On the eve of the New Year, the newly-merged Air India today announced three new schemes, including one in which a passenger can get a free return ticket to a foreign destination if he or she flies 25 times by the airline between six metros between January and March.

The ‘Touch 25’ scheme, which is applicable to those travelling 25 times between January one and March 31 between Delhi, Mumbai, Kolkata, Chennai, Hyderabad and Bangalore, would be entitled to a free return ticket for self or nominee in economy class to New York or London or Shanghai from Delhi and Mumbai, an Air India spokesperson said.

Another scheme allows travel from March 1 to April 15 on a major part of the airline’s domestic route network at a price of Rs 999 plus taxes and levies, totalling Rs 1,875. The tickets at this rate have to be bought between January 5 and January 20, the spokesperson said.

The third scheme, called ‘Touch West’, is aimed at the frequent fliers. Three round trips on Air India between India and the UK, Europe, the USA or Canada in first or business class between January 1 and March 31 will fetch a passenger a week’s unlimited travel in business class domestic sectors.

These schemes are the first three announced by the national carrier after its merger. — PTI

Mumbai, December 31
In the new year gift to the mutual fund investors, the market regulator SEBI today exempted them from payment of entry fee on applications filed directly to the asset management companies (AMC).

"It has now been decided that no entry load shall be charged for direct applications received by the AMCs i.e.applications received through Internet, submitted to AMCs or collection centre/ investor service centres that are not routed through any distributor/ agent/ broker," Securities and Exchange Board of India said in a circular here.

The exemption would apply for investments in existing schemes with affect from January 4, 2008 and in new scheme to be launched thereafter.

The SEBI circular further said, the entry fee exemption would also apply to additional purchases made directly by the investors under the same folio or for switching from one scheme to the other.

These exemptions, the SEBI said, were intended "to protect the interests of investors’ securities and to promote the development of, and to regulate the securities market".

"This is good and positive move and will help the mutual fund industry," said managing director of the Delhi-based Taurus Asset Management Company R K Gupta while commenting on the SEBI notification.

Gupta further said this decision was overdue and "for the past five years we have been pressing for this exemption".

The SEBI's move, however, would have adverse implications for the intermediaries who have been involved with the mutual fund industry. — PTI

New Delhi, December 31
Tata Steel and state-run SAIL, the country's two biggest makers of the alloy, are all set to form a joint venture to mine coal blocks for securing assured coking coal supply to meet their increasing production needs.

"Steel Authority of India Ltd (SAIL) and Tata Steel are likely to sign an agreement to form a joint venture company for mining four coking coal blocks, most-likely in Jharkhand which have reserves of about 500 million tonnes for meeting their production needs," a senior government official told PTI.

He said both companies would seek to put in place a formal JV company through the pact and then begin scouting for more coal blocks.

The board would have representatives from both companies. The new entity is likely to have an initial capital of Rs 2 crore, to be shared equally.

In view of the growing steel demand, both firms have embarked on major capacity expansions to ramp up production capacities.

While SAIL aims to increase output to 26 million tonnes at a cost of more than Rs 50,000 crore, Tata is also executing major brownfield and greenfield expansion projects. — PTI

Mumbai, December 31
The stock market recorded its second-fastest rally in five years as its benchmark Sensex ended the year today with a gain of 47.1 per cent in 2007. In absolute terms, surge of 6,500 points in 2007 is the highest ever in the over two decades of history of Sensex.

But when it comes to percentage gain, the highest was recorded in 2003, when the barometer index rose by 73 per cent. The Sensex stood at 13,786.91 points at the end of 2006 and closed the year 2007 at 20,286.99 points today. It crossed seven thousand-point milestones from 14,000 to 20,000 marks — during the year, which is the maximum for a year.

The surge of 47.1 per cent in 2007 is higher than 46.7 per cent gain in 2006, when the Sensex had gained 4,388 points. Prior to that, the Sensex had risen 42.3 per cent in 2005 and 13.1 per cent in 2004.

In absolute terms, the Sensex had surged by about 2,800 points and 765 points in 2005 and 2004, respectively. In 2003, when the Sensex soared by 73 per cent, it had gained just 2,461 points in absolute terms.

Earlier in 2002, the Sensex had risen just 3.5 per cent, while it had seen losses of 18 per cent and 21 per cent in 2001 and 2000, respectively.

The market capitalisation of all listed companies rose by more than Rs 35,00,000 crore to settle at Rs 71,69,983.31 crore at the end of 2007.

The 30 blue-chip companies in the Sensex saw their market value soaring to Rs 28,61,341 crore at the end of the year. — PTI