New Delhi, April 28
The explosive rate of growth in India has created a phenomenal demand for talent so much that wages are forecast to rise by 14.4 per cent during the year 2008, says a latest report.

"Wages are forecast to rise by 14.4 per cent during 2008, the fifth successive year of double-digit growth. This far outstrips wage inflation in China (8.6 per cent in 2007) and is second only to Sri Lanka, where wage growth has been driven by high inflation," global management consultancy firm HayGroup said. The high level of demand for experienced employees is driving wage inflation and creating a culture of job-hopping.

Staff turnover of 20 per cent or more is not unusual in high-demand sectors such as the service industry, as talented workers jump from employer to employer, following the promise of even higher wages.

"Reward programs of companies are in crisis as wage inflation is witnessing an upward spiralling and staff turnover rates hit new highs," the HR consultancy firm said.

"In an environment where employees can achieve a pay rise of between 40 per cent and 50 per cent by moving to a competitor, they are unlikely to stay put," HayGroup added.

In the year 2007, the middle management level witnessed the maximum increase in average annual base salary (16 per cent), while supervisory, senior management and the executive level had an average annual increase of 14 per cent in their base salaries.

The least percentage of increase was witnessed in case of the clerical staff which saw an increase of only 12 per cent in their base salaries, the report added.

India, which has earned a reputation as a source of keen, talented, educated and English-speaking employees, particularly in the IT and service sectors is rapidly witnessing a change in its perception.

"While there is no shortage of graduates in India, there is real concern about the quality of new recruits," the report said, adding that the country's universities produce three million graduates a year but only a fraction are considered suitable for employment in the business processing and IT outsourcing industries. — PTI 

New Delhi, April 28
Stepping up its efforts to control rising steel prices, the government is likely to impose up to 15 per cent export duty on various steel products, including those used exclusively for construction purposes.

"More than flat products, there is scarcity of long steel products and as such there is an express need to contain their prices. There is clearly a case for imposing export duty on both flat and long products like bars, rods etc," an official source told PTI.

As part of the move, the government is also planning to impose 10 per cent duty on export of flat steel products used by automobile sector and 15 per cent on long steel products like TMT bars, rods, wires and galvanised plain and corrugated steel sheets, the source said.

The finance ministry is understood to have approved a slew of measures for containing the upward spiral in steel prices after harping on a 'revenue-neutral model' to offset the losses to the exchequer on account of these measures. A notification to this effect from the finance ministry is expected this week.

Interestingly, the government is planning to impose export duty on galvanised sheets as the earlier suggestion from the steel ministry was to levy duty on flat and long products.

Steel prices have risen by up to 49 per cent during the past one year and recently most companies, barring state-run steel giant SAIL and world's cheapest steel maker Tata, have started levying raw material surcharge of Rs 5,000 to somewhat offset their input costs.

However, the steel industry is maintaining that imposition of export duty would not address the demand-supply mismatch of the alloy in the domestic markets.

"There is enough availability of flat products in the country and if export duty was imposed, then we would divert surplus production to local markets. Are these markets adequately geared up to absorb these products? If not, then what happens?" a steel industry official asked.

However, any imposition of 15 per cent ad valorem duty on iron ore export is unlikely as the ministries of commerce and mines are understood to have opposed such move saying it would trigger the downfall of the mining industry.

The steel industry is, however, categorical in demanding export duty on ore saying future shortage of the mineral could jeopardise their capacity expansion plans.

The Indian Steel Alliance, the umbrella body of leading steel utilities has argued that in view of limited reserves of iron ore the export of the mineral be either canalised or disincentivised to ensure availability of the mineral for domestic steel utilities. — PTI 

New Delhi, April 28
Days after the Department of Telecom (DoT) announced new guidelines for mergers and acquisitions, there was bonanza in store for the mobile phone users today with Bharti Airtel slashing its STD and roaming tarrifs by up to 43 per cent and Reliance Communications (RCom) announcing a plan for ‘unlimited free STD’ calls.

As had been suggested by the experts, the new guidelines have forced the mobile phone operators to slash prices mainly to take on the expected competition and the first step was taken by Bharti Airtel, which would benefit its 62 million customer and would also start a new price war in this segment after local calls.

The company has reduced STD rates by 43.39 per cent to Re 1.5 minute from the earlier Re 2.65 per minute. The new tariffs would be effective from April 30 and would be available for both pre and post-paid users.

According to a statement issued by the company in the new tariff plan, roaming charges for incoming calls would be cut to Re 1 per minute from the present Rs 1.75 per minute, a reduction of 42.85 per cent. Further, Airtel customers, while on roaming, would be able to make local calls at Re 1 per minute and an STD call at Re 1.50/minute.

As expected, the move by Airtel has started a similar trend among other cellular operators also with Reliance being the first to announce further incentives on its services, a clear bid to retain its subscriber base.

RCom is offering unlimited STD calls at a monthly rent of Rs 440 while the pre-paid customers can enjoy the same at a scheme of Rs 496 (inclusive of service tax), a statement from the company said.

Other operators like Vodafone Essar and Tata Teleservices would most likely follow suit to get more customers.

Incidentally, Telecom regulator TRAI has been urging operators to reduce roaming rates for while, saying they have been on the higher side. TRAI has already abolished practice of levying Access Deficit Charges (ADC) on private operators and asked the operators to pass on the benefit to the consumers bringing down the rates in the rural areas of the country.

Asked about the hit the company would have to take following this reduction, Bharti Airtel president and CEO Manoj Kohli said, whatever is the impact that would be offset by the elasticity of volume, adding "this initiative will particularly benefit rural customers."  — PTI 

New Delhi, April 28
Reliance Communications (RCom) today said it would launch GSM based nationwide mobile services by the end of current financial year, to become the only operator offering mobile services on both GSM and CDMA platforms.

"We are aiming to set up nationwide GSM and CDMA network by fiscal end which will cover 23,000 towns and six lakh villages serving 97 per cent of the Indian population," RCom president S P Shukla said.

The company has been given start up GSM spectrum (radio frequency) to offer wireless services under the dual technology and also CDMA spectrum in the remaining two circles of North East and Assam.

With the focus to enhance the momentum of teledensity growth in rural India, the company has also launched a affordable mobile offering — ‘Gaon Chalo’ for rural areas.

Reliance Communications would roll out mobile network in another 8,000 towns and 2 lakh villages over the next six months.

"After bringing down cost of calls, validity and devices in urban India which triggered unprecedented market growth, we will now do the same for the rural population," he said.

The new offer would enable a rural customer to go mobile at Rs 49 which is a 50 per cent discount over the cost to go mobile in the urban areas.— PTI

Islamabad, April 28
Pakistan and Iran today announced they had cleared all hurdles that had delayed the $7.5-billion IPI project to carry gas to India and will ink a bilateral agreement soon on the pipeline that is being stiffly opposed by the US.

The decision came after Pakistan President Pervez Musharraf held an hour-long meeting with his Iranian counterpart Mahmoud Ahmadinejad, who had a brief official stopover in Pakistan while on his way to Sri Lanka and India.

"The two leaders said the Iran-Pakistan-India project will promote peace and friendship," Pakistan's foreign minister Shah Mahmood Qureshi told reporters here.

He said the foreign ministers of Iran and Pakistan had been asked to agree on a mutually convenient date for signing the bilateral agreement on the pipeline.

Qureshi said Musharraf and Ahmadinejad expressed satisfaction at the resolution of all issues that had delayed a final agreement on the pipeline and hoped that the project will help meet the future energy needs of Pakistan.

The resolution of these issues paved the way for a bilateral agreement to be signed soon in Tehran, Pakistani officials said. Iran also agreed to provide 1,100 MW of electricity to Pakistan. During talks held here last week, the petroleum ministers of India and Pakistan reached consensus on basic issues for building the IPI pipeline and said work on the project could begin next year.

The US has bluntly asked India and Pakistan to scrap the IPI project with Iran over Tehran's controversial nuclear programme.

Qureshi said Iran also gave a positive response to a Pakistani proposal to supply gas to China with a gas pipeline passing through its territory along the Karakoram Highway. Pakistan last week said it had finalised a gas sales and purchase agreement with Iran. — PTI 

New Delhi, April 28
If we thought that the only way to get gas from Iran is through pipeline, think again. One of the big consumers of natural gas - the fertiliser sector - is rushing to participate in joint ventures with Iranian companies and may not depend on pipelines to meet its burgeoning requirements.

Fertiliser companies are said to be in talks with Iranian companies to set up a urea plant in the country on the lines of the OMIFCO project in Oman. These participation, sources say, will solve two problems - one, cheap and assured availability of gas and, second, cost effective urea production.

Sources in the industry say there is a 10-15-lakh tonne per annum project under consideration for producing urea in Iran. What really is fascinating about the project is that the landed cost of urea will be around $165 per tonne as compared to the present international price of $500 per tonne ruling the market.

The price of urea, which has gone up by nearly three times in the last one year because of rising cost of gas, is a reason that has prompted Indian companies to look for setting up plants in hydrocarbon rich regions, say industry sources.

The corporate structure of the project is likely to be a joint venture between an Indian and an Iranian company. As compared to the gas from the IPI pipeline, which is available at $4.93 mmbtu, plus transit and transportation cost, gas at the wellhead for this project will be available at $0.75 per mmbtu. The landed cost of urea from this project is likely to be around $165 per tonne on Indian port at the current price levels similar to what is available from OMIFCO project, confirm industry sources.

The project, which is under consideration at the moment, will be for a duration of 15 years. The sources say IFFCO may be the likely choice of partnering this project and a team of officials from IFFCO and the Department of Fertilisers will soon visit Iran for talks.

The project already has a technology provider and a banker ready to invest in the 10-lakh tonne capacity. India’s requirement in 2008-09 for imported urea is projected to be around 49.17 lakh tonne.

Yet another project is in the offing in the northeastern part of Iran. The Iranian President Mahamoud Ahmedinejad had initiated the project for the development of the land-locked region and exploitation of the potential of huge gas reserves besides providing employement and development of the hilly region.

The sources say the capacity of this plant is likely to be around 10 lakh tonne and the landed cost of the urea from the project will also be somewhere around $165-200 per tonne.

New Delhi, April 28
State-run GAIL India Ltd will be part of a consortium that will be building the $7.6-billion Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline by 2015.

Unlike the rival pipeline from Iran, the 1,680-km long pipeline from Dauletabad gas field in Turkmenistan will be built and operated by a consortium of national oil companies from the four countries, a top official said here.

India last week formally joined the US-backed project to meet its growing energy needs.

The rival Iran-Pakistan-India gas pipeline is to be built by the three nations separately — Iran is to build the section of the pipeline that fall in its territory, while Pakistan will construct the 1,035-km length from Iran-Pakistan border to Pakistan-India border. India will lay the line from its border with Pakistan to the consumption centre. But, TAPI would be constructed by a consortium. — PTI 

BRIEFLY

DUBAI
TCS plans West Asian centres: Tata Consultancy Services will open centres in Egypt, Abu Dhabi and Oman as part of its drive to focus more on West Asia and North Africa region. Meanwhile, the company on Monday said it has bagged an eight-year contract worth $120 million (£60 million) from British utility Scottish Water. — Agencies

DUBAI
India 2020 Opportunity Fund: An Oman-based private equity firm has set up an India-focused fund that will invest in rapidly expanding small and mid-size Indian enterprises. The India 2020 Opportunity Fund will primarily invest in industries benefiting from the robust domestic Indian economy and growing consumer class. 
— PTI