The Tribune, Chandigarh, India

	Finally, states agree on GST rates Tribune News Service & PTI New Delhi, September 16 States will have two rates for the proposed Goods and Services Tax, slated to be introduced from April 1, 2010. There will be one standard rate and another lower rate for essential commodities, Value Added Tax Panel (VAT) chairman Asim Dasgupta told reporters. “We have reached a consensus so far as states GST is concerned. There will be two rates, one standard rate and the other lower rate for essential commodities,” Dasgupta said after the Empowered Group of states finance ministers and officials of union finance ministry met here. There will be a “special GST rate” for a small list of precious metals. Also, there will be a list of exempted items. Asked whether the Centre will have two GST rates, Dasgupta said he could not speak on behalf of the Union Government but it was likely to have a “good deal of conformity” with state-level GST. It had already been decided that there would be a dual model of GST — separate GST for the Centre and states. It is still not clear whether there will be a two-Tier structure for Central rates of GST. The group also decided to set up immediately a joint working group to decide on a framework for constitutional amendment for the purpose of introducing GST and a framework for model legislation on GST for the Centre and the states. The committee would submit a report within a two-month time. “We think we do not have any time to lose. Therefore, the framework for constitutional amendment is necessary as soon as possible, in a time bound manner,” Dasgupta said. Asked whether foodgrains will be in the exempted category or attract lower tax rates, he said: “We have to reach a consensus” on the issue. The group will meet Finance Minister Pranab Mukherjee very soon to discuss further issues on goods and services to be covered under the GST. The GST is expected to be a further improvement over state-level VAT that has two basic rates of 4 and 12.5 per cent. The new tax system, aimed at creating a common Indian market, will replace excise duty and service tax at the Centre and VAT and local taxes at the States’ level. However, states like Chhatisgarh, Haryana, Tamil Nadu, Rajasthan AND Madhya Pradesh expressed reservation over the introduction of GST.
	Gas Row RIL cautions NTPC on commenting on sub judice matters New Delhi, September 16 Reliance Industries has cautioned that NTPC should not make comments on matters sub judice lest they are construed as attempt to influence the outcome of its court case seeking natural gas at price committed in 2004. Commenting on NTPC's filing to the stock exchanges last week, RIL president (gas) RP Sharma wrote to Power Secretary HS Brahma saying "(NTPC's) statement purports to state that a contract came into existence between NTPC and RIL even before the court has heard the arguments and pronounced judgement." NTPC's 2004 tender seeking supply of 12 mmscmd gas for expansion of its Kawas and Gandhar power plant, had clearly stated that the issue of Letter of Intent to the lowest bidder was to be followed by signing of agreement within stipulated period for the contract to come in place. RIL bid the lowest $2.34 per mmBtu. "Pursuant to the (post LoI) discussions (on clauses in the Gas Sales and Purchase Agreement), RIL in December 2005 had sent to NTPC a signed GSPA in duplicate containing ceiling for liability and essentially the same terms (gas price of $2.34 per mmBtu) as bid by RIL ... With NTPC not signing the GSPA sent by RIL and instead filing a suit before the Bombay High Court, RIL withdrew the offer," he wrote. RIL rubbished NTPC claims of savings to consumers on difference between the 2004 bid price and the government approved rates of $4.2 per mmBtu saying the $2.34 per mmBtu gas price was for expansion projects at Kawas and Gandhar which do not exist today and the other rate was for existing plants. NTPC asked to ink gas contract with RIL The Power Ministry is believed to have instructed state-run NTPC to sign a gas supply deal with Mukesh Ambani-led RIL to lift government allotted quota, while favouring that marketing margins be decided by the Oil Ministry instead of the supplier. "The GSPA (gas sales and purchase agreement) for supply of gas from RIL to NTPC for its Kawas and Gandhar expansion projects could be signed by the month-end," a Power Ministry source said. Regarding the marketing margins, the sources said the state-run power major has been told that these could be decided by the Petroleum Ministry, rather than the supplier, Reliance Industries. Anil Ambani group, in the midst of a legal battle over gas supply with RIL, recently raised a row saying that the marketing margin charged by the Mukesh Ambani-led firm was illegal. In a recent communication made to the Power Secretary, Reliance Industries had said that NTPC was refusing to sign GSPA to take the government allocated 2.67 mmscmd of KG-D6 gas for its existing plans. This gas was allocated to NTPC by the government and is not the subject matter of a legal case that the power PSU has initiated against RIL over supply of 12 mmscmd over 17 years.— PTI
	Govt to form EGoM panel on road projects Tribune News Service New Delhi, September 16 The Centre has decided to set up an Empowered Group of Ministers (EGoM) committee to monitor the progress of road development projects, especially highway development projects. The move has come following initiatives taken by Road Transport Minister Kamal Nath, who has not only been going around the world putting up road shows inviting foreign investors to India, but has also met World Bank president Robert Zoellick recently seeking a $6 billion loan for road development in the country. Reports suggest that members of the proposed EGoM would include Planning Commission Deputy Chairman Montek Singh Ahluwalia, Finance Minister Pranab Mukherjee along with Kamal Nath. The proposed EGoM will help resolve issues related to bidding process and also decide on some reservations expressed by foreign investors. The decision to form an EGoM is in accordance to the recommendations of an expert panel formed by the Prime Minister’s Office (PMO) to suggest measures to expedite the flagship National Highway Development Programme (NHDP). Several recommendations made by the committee headed by BK Chaturvedi, member of Planning Commission, are expected to be cleared over the next two weeks. Among other proposals was the unbundling of road development from maintenance by removing the exit clause from concession agreement. The move will allow road developers to exit from the project once works are complete. The state of road development could be gauged from the fact that of the proposed 60 highway projects to be awarded in 2008-09, nodal agency National Highway Development Authority (NHAI) could award only eight. Besides, the NHAI managed to spend only about 30 per cent of its total expenditure budget of nearly Rs 32,000 crore in the last fiscal.
	Row over Pay Cuts AI unions threaten stir Shiv Kumar Tribune News Service Mumbai, September 16 After Jet Airways, it could be the turn of Air India to grapple with trade unions. Ahead of Thursday's board meeting, where the national carrier's top officials will deliberate on reduction in productivity-linked incentives, eight trade unions sent out a joint statement that employees would put up "stiff resistance" if a "unilateral decision (on) wage cut/deferment" is taken. Unions representing pilots, engineers and other grades of employees have put out the joint statement addressed to the Prime Minister, Civil Aviation Minister and senior Air India officials. The unions stated that Air India and Indian Airlines were both profit-making entities that were merged and pushed into losses. They also noted that an overdraft of Rs 16,000 crore taken from banks for meeting working capital requirements has "disappeared". The government is leaning on Air India management to cut costs as a pre-condition for fund infusion. However, the unions alleged that suggestions put out by them to improve productivity and reduce costs were disregarded by the management which was instead pushing for a 50 per cent cut in salaries of employees. Like the Jet Airways employees, Air India's unions also complained against the recruitment of expatriate pilots at higher salaries.
	TVS to sell ‘Flame’ till Nov 30 New Delhi, September 16 Chennai-based TVS Motor Company today got some reprieve, with the Supreme Court allowing the two-wheeler firm to make and sell 125-cc 'Flame' motorbike that sports twin-spark plugs, the technology for which Bajaj Auto claims to hold patent. A Bench headed by Justice Markandey Katju, while disposing of Bajaj's petition, asked the single judge of the Madras High Court to hold day-to-day hearings and decide the matter before November 30. The apex court ordered the high court to appoint a receiver, who will keep record on sales of Flame across India and submit its report to the high court. While vacating its interim orders of June 8 and August 31 that allowed TVS Motor to make TVS Flame but restrained it from moving its "finished product (motorcycle) from its warehouse", the bench added that the single judge should not be influenced by any observations made by the apex court or the division bench of the high court. — PTI
	Rise in cotton exports likely this year KS Chawla Ludhiana, September 16 Cotton production in the country is expected to be nearly 320 lakh bales this year despite drought-like situation in many states. The area under cotton has increased to more than 100 lakh hectares against 94 lakh hectares of the last year. Enquiries made by The Tribune from sources close to the cotton textile industry revealed that the states of Maharashtra, Madhya Pradesh and Gujrat were not badly hit by drought conditions. The country already has carry-over stock of 71.5 lakh bales. During 2008-09, the domestic cotton consumption was 230 lakh bales and about 30 lakh bales were exported. The sources said cotton exports would be more this year compared with last year. China is facing shortfall in cotton production, as its production is 7.1 million tonnes against the demand of 9 million tonnes. The cotton production globally will be around 23 to 23.5 million tonnes and the demand maybe of the same order. As far as cotton production in the northern region comprising Punjab, Haryana and Rajasthan is concerned, the same is likely to be around 47 lakh bales this year against 44 lakh bales last year. While area under cotton has increased in Haryana and Rajasthan, it has reduced in Punjab. Cotton acreage in Punjab this year is 5.27 lakh hectares, in Haryana it is 5.20 lakh hectares and in Rajasthan 4.15 lakh hectares. Punjab is expected to produce 18.25 lakh bales (as of last year), Haryana 17.5 lakh bales and Rajasthan 12 lakh bales. So far, the Cotton Corporation of India (CCI) has not offered to buy any cotton. Last year, major buying was done by the CCI due to the recession.
	Aircel offers STD at one paisa per second Tribune News Service Shimla, September 16 Mobile phone service provider Aircel has launched a new scheme under which the subscriber will be charged for actual usage on the basis of per second pulse. Vipul Saurabh, national head operations of the company, said the charges for both local and STD calls would be one paise per second. The New Aircel Lifetime connection, available for Rs 49, would have a pulse per second rate and existing subscribers could also opt for ‘pay per second’ without any additional cost. International Calls would also be charged at “per second pulse” allowing subscribers to make calls to Australia, Canada, South- East Asia, UK and the USA at 11 paise per second. The company had presence in 18 circles with over 24 million subscribers across the country.
	BSNL bids for Millicom’s Lankan operations Tribune News Service New Delhi, September 16 State-owned telecom service provider Bharat Sanchar Nigam (BSNL) today said it had bid for Luxembourg-based Millicom’s Sri Lankan operations. Millicom has put its assets in Sri Lanka, Laos and Cambodia up for sale, and expects to complete the deals by the first quarter of 2010. BSNL has expressed its wish to expand its overseas operations. It has cash reserves of over $6 billion, but needs the government’s nod to venture into any big investment. Yesterday, BSNL chairman Kuldeep Goyal said the telecom provider was still considering an invitation to join a consortium to acquire 46 per cent stake in Kuwait-based telecom firm Zain. Vavasi Group, a little-known Indian firm, is leading the consortium with a Malaysian businessman to buy stakes - comprising Kuwaiti family conglomerate Kharafi Group’s estimated 20 percent holding plus that of other shareholders - in Zain, in a deal valued at around $13.7 billion. BSNL and another state-run telecom, MTNL, have been approached to join the consortium. In a statement issued last week, the two firms said while they were open to opportunities to expand abroad, they were yet to take a decision on the Zain deal. Meanwhile, reports said BSNL was re-evaluating plans for launching full-fledged code division multiple access (CDMA) based mobile services. Last year, the public sector company had outlined plans to make a foray into the CDMA sector and invest $500 million-$1 billion for expanding its CDMA operations to a pan-India level. Currently, BSNL has limited CDMA operations in large cities and its mobile operations are largely concentrated on the popular global system for mobile communications (GSM) technology. It has over 52 million subscribers on this platform.