New Delhi, June 17
The government is soon going to ask the bulk diesel-consuming sectors of the economy to pay market price. The new market retail price for diesel will be applicable only to buyers like power stations, malls, hospitals etc, making exception to the transport sector — railways and roadways. This is a move to compensate the losses suffered by the oil marketing companies, who are facing revenue shortfalls due to subsidised selling of all petroleum products.

At present, the transport sector consumes 51 per cent of diesel in the country followed by industry that accounts for 14 per cent consumption and agriculture sector, which has a 4 per cent share among others. Most of the commercial sectors in the economy are using diesel because the price of alternate fuels like naphtha and fuel oil have reached stratospheric levels thus increasing the cost of production.

Power plants like NTPC switched to diesel a year back instead of naphtha because of the subsidy advantage. Another reason for the shift has been the shortage of coal. But, with this decision, the cost advantage is likely to go. The cost of the end product is also going to be high as these companies will have to pay market prices for diesel and they in turn will ask the consumers to fork out the same.

The decision, which is still being pencilled, is that direct import of diesel will be sold at import price plus margins by the oil companies. In case of diesel being produced by oil companies domestically, the market price will be applicable, which is cost of production plus taxes and margins.

Experts, however, are wary of a decision like this and say that since the industrial growth is sluggish and is expected to slide further in the coming year, any such decision like this would only put further brakes in the sector.

However, the finance ministry may be having an objection to this decision because on June 5, the customs duty on imported diesel has been brought down to 2.5 per cent from the 7.5 per cent level, thus hitting the revenue collection from this sector. The finance ministry has projected a loss of Rs 26,600 crore from the duty rollback decision taken recently.

The commerce ministry could also be having certain reservations as regards this decision because most companies show exports of petroleum products from the country and import some of that quantity back from the high seas ,thus taking duty and foreign exchange benefits in this round tripping.

Diesel is the most widely used oil product in the country and its sales rose by 11.1 per cent to 47.63 MT in 2007-08, followed by petrol, whose sales increased by 11.2 per cent to 10.32 MT as compared to the previous year.

Chandigarh, June 17
With the government now encouraging the oil marketing companies to produce and sell more of the premium fuels, urbanites and those taking the highways to different destinations are in for a tough time. They will now have to pay more for the premium fuels as the normal fuel supply will be restricted in the urban areas and along the national highways.

Since the premium fuels (petrol and diesel mixed with high value additives) are linked to the global prices, the three state-run oil marketing companies — IndianOil, Hindustan Petroleum and Bharat Petroleum — have now made it mandatory for their dealers to lift fixed quotas of premium fuels, ranging from 40-50 per cent. The pricing of premium fuels is out of the purview of the government, which has encouraged the oil companies to sell these and make up for their losses.

Sources informed TNS that HPCL had called a meeting of its dealers in North Region on June 14, wherein the latter were told that 50 per cent of their total fuel supply will have to be the premium fuel. The other two oil marketing companies are entertaining indents for petrol and diesel only if these are accompanied by 30-40 per cent indent of premium fuels.

Across India, petroleum dealers are now demanding action against these oil marketing companies, for forcing them to sell premium fuels, which was against the provisions of the Essential Commodities Act. The Madhya Pradesh government has already asked these companies to ensure that normal fuel is available at all retail outlets and customers not be forced to buy premium fuel. In a letter shot to the three oil companies by the commissioner, food and supplies, Madhya Pradesh, they have been warned against "alleged profiteering' in the name of selling branded fuel.

J.P. Khanna, president, Punjab Petroleum Dealers Association, said petroleum dealers in Punjab, Himachal Pradesh and Rajasthan, too, had approached the state food and civil supplies department to restrict the oil companies from forcible selling of premium fuels.

Petroleum dealers are up in arms against this “arbitrary decision of the oil companies”. A petroleum dealer in Nawanshahr said people were still reeling under the impact of the Rs 5 hike in petrol and Rs 3 hike in diesel.

"The premium petrol price has gone up by Rs 6 a litre and premium diesel by Rs 4 a litre, and the price difference between the premium petrol and normal petrol is Rs 3.80 per litre and between the two variants of diesel is Rs 2.20 per litre. People are not ready to buy premium fuels, which we are forced to sell them as the stock piling of these fuels cannot be done beyond a point," he says. 

New Delhi, June 17
As part of its initiatives in Asia, Yahoo!, the leader in mobile advertising and mobile Internet services, today announced its partnerships with two Indian mobile operators MTNL and Idea Cellular.

As part of the partnership, Yahoo! oneSearch, the mobile search engine, will now feature on MTNL phones and in the case of Idea Cellular, the partnership is for mobile advertising.

The Sunnyvale, California-based company today announced several new mobile initiatives for the Asia Pacific region, including five new Yahoo! oneSearch partnerships with leading mobile operators , including MTNL, Hong Kong CSL Ltd (CSL), Smart Communications Inc (Smart, Philippines), Digital Mobile Phlis, Inc (SUN Cellular, Philippines) and Vibo Telecom Inc (Vibo, Taiwan).

It has also forged strategic mobile advertising partnerships with Idea Cellular Ltd and Maxis Communications Bhd (Malaysia), the company said in a statement distributed via Businesswire.

The statement further said that Yahoo would also be launching new mobile widgets for the Asia Pacific region, including Yahoo! Cricket, Yahoo! Answers and Showtimes (Yahoo! India Movies), as well as a MTV Asia mobile widget featuring news updates and music charts.

These announcements further demonstrate Yahoo!'s global momentum and unveil the next phase of the company's mobile strategy for the Asia Pacific region, said the release. 

Singapore, June 17
Indian billionaire Anil Ambani, whose flagship company Reliance Communications (RCom) is in talks with South Africa-based MTN, is looking to buy more than 40 per cent stake in the telecom major, a media report today said.

"Anil Ambani, chairman of India's Reliance Communications (RCom), is considering buying more than 40 per cent of MTN, Africa's biggest wireless company," the Financial Times reported here in its Asia edition.

The report said that Ambani was looking for ways to increase his "in-effect" controlling position in the South African firm.

Quoting people familiar with the situation, the newspaper said, "... Ambani was looking at how he could maximise an in-effect controlling position in MTN by seeking to persuade the South African mobile operator's shareholders to waive their right to a tender offer." — PTI

New Delhi, June 17
The government has allowed private mobile operators to enter into mutual agreements for intra-circle roaming with each other, a move that will help new players who are yet to roll out their networks and those who do not have licence in a particular service area.

The DoT circular said: "A licensee may enter into mutual commercial agreements for intra-service area roaming facilities with other cellular operators." Industry sources said the measure may have been undertaken to benefit new operators with no telecom experience or infrastructure of their own or are in the process of rolling out their own networks.

The DoT decision would not, however, change the mandatory network rollout of 60 per cent in the first year but would give them a chance to offer their customers intra-circle roaming by allowing them to tie-up with other operators.

The circular said roaming arrangements are normally entered into by access service providers for service area for which they do not have licence to provide service.

Therefore, so far the request for mandatory roaming facilities among the players have not been agreed to. However, there is no bar in entering into roaming agreements subject to the mutual commercial agreements by various service providers. — PTI 

New Delhi, June 17
With the interest rising in the auction of the 3G spectrum, the Department of Telecom (DoT) has been toying with various options, the latest being that it is considering to impose eligibility conditions for participating in it.

In a move that is sure to miff the new players, the DoT, while keeping the auction open to new and foreign players, may make it mandatory for the bidders to have a minimum of one year experience in rolling out telecom services in any part of the world and have at least five lakh mobile subscribers.

The proposal is already having its effect with the new players looking at entering the business feeling that it is discriminatory against them.

However, the official at DoT explain that this is a clear attempt at keeping the non-serious players out of the bidding process for the 3G spectrum, which is in limited supply.

If DoT does put this pre-condition then a number of new players, who were issued universal access licences only recently, and will roll out services only by the year-end will not qualify for the bidding process. These could include operators like Videocon, Unitech and Swan who at present do not have any experience in running a mobile business.

Experts point out that if such a condition is put then the newer players would have no option but to tie up with foreign players who would be looking for a strategic partner here. Incidentally, the proposal also has the backing of the finance ministry and the law ministry.

The Department of Legal Affairs has reportedly sent a report where it clearly says that they were of the opinion that it is legally permissible for the government to specify pre-qualification for international competitive bidding. In respect of new licencees who do not have prior experience in the telecom sector is concerned, it may be stated that no right has been accrued by them for bidding for 3G spectrum.

DoT also had the backing of the finance ministry on this and has finally decided to keep the auction open even for the foreign players.

New Delhi, June 17
For the government the task of indirect tax collections is going to be a formidable one in 2008-09, with the industrial growth dipping and crude oil prices rising.

Finance minister P Chidambaram had said that meeting target of excise duty collections for this fiscal appeared to be a formidable task.

The government has mopped up 12.8 per cent higher revenues at Rs 35,216 crore from indirect taxes, barring service tax, for the first two months of this fiscal. This is a relatively better pick up considering that indirect tax collection in April was negative.

In April, collections under excise duty had fallen by 3.9 per cent to Rs 6,410 crore, against Rs 6,673 crore in the same month last year.

Excise duty collections grew by a meagre 0.9 per cent at Rs 15,993 crore for the first two months of this fiscal compared to the same period last year.

In May, the excise duty collection grew by 4.4 per cent to Rs 9,583 crore against Rs 9,175 crore in the same month last year. Excise duty collection growth in May fell short of the target of 8.8 per cent growth for the whole fiscal.

Service tax collection, the data for which is available only for April, grew by a whopping 40 per cent at Rs 6,093 crore in that month, according to an official release. This being mainly due to new services brought under the service tax ambit as per the announcement in the Budget of 2008-09.

Customs duty mop-up was up by 25.1 per cent for the first two months at Rs 19,223 crore. From the month of April 2008, collections under this head grew by 25.2 per cent to Rs 10,205 crore till May 2008. Customs duty and service tax collections are targeted to grow at 14.4 per cent and 26.1 per cent during the current fiscal, respectively. 

Mumbai, June 17
Making it easier for urban co-operative banks to extend housing loans, Reserve Bank has relaxed the risk provisioning norm for purchase of residential properties up to Rs 30 lakh.

The central bank issued notification yesterday in pursuance of the annual credit policy announcement made by the RBI Governor Y.V. Reddy on April 29.

Earlier on May 15, the Central Bank had relaxed the risk provisioning norms for housing advances by the commercial banks.

"It has been decided to enhance the limit of Rs 20 lakh to Rs 30 lakh in respect of bank loans for housing in terms of applicability of risk weights for capital adequacy purposes.

Accordingly, such loans will carry a risk weight of 50 per cent," Reddy had said.

The move would provide the urban co-operative banks additional capital for lending more to housing sector.

For banks, the amount of capital they are required to set aside for each loan is decided by minimum capital adequacy ratio prescribed by the central bank. Capital adequacy ratio is the ratio of a bank's net worth to its risk-weighted credit.

According to the analysts, the RBI has modified the provisioning limit for housing loan to take care of the growing property rates mainly in the urban centers.

The risk provisioning earlier was 75 per cent of the loan value between Rs 20-30 lakh.

For loans exceeding Rs 30 lakh for purchase of residential property, the banks would have to make a risk provision on 75 per cent of the loan amount. — PTI 

BRIEFLY

Goldman Sachs buyout
Mumbai: Goldman Sachs has invested $50 million to acquire a minority stake in Shapoorji Pallonji group company, Sterling & Wilson (S&W). Avendus Capital was the exclusive financial advisor for the transaction, a press release issued here on Tuesday stated. — PTI

Tech Mahindra-Microsoft pact
Mumbai: Tech Mahindra has entered into a strategic global alliance with Microsoft Corp, to address its system integration requirements for deployment of the Microsoft Mediaroom Internet Protocol Television (IPTV) and multi-media software platform. The alliance will further empower Tech Mahindra in its quest to implement best-performing IPTV solutions and support cutting-edge technologies in interactive digital television.— PTI

CII in pact with Warwick
London: Indian industry body Confederation of Indian Industry and the Warwick Manufacturing Group have signed a new agreement to develop new opportunities for carrying out research and development in key manufacturing processes. Based at the University of Warwick, WMG is led by noted Indian-origin technocrat Lord Sushant Kumar Bhattacharyya, who is closely involved with the Tata Group. — PTI

Vijaya Bank ups deposit rates
Bangalore: Vijaya Bank has raised its interest rates offered on deposits of 'one to less than two years' maturity by 30 basis points from 8.50 per cent to 8.80 per cent, which would be effective from Wednesday. The revision is with a view to narrowing liquidity gaps under specific maturity slab, the bank said in a statement.— PTI