The Tribune, Chandigarh, India

	Moody's forecasts hike in interest rates New Delhi, October 8 Central banks in India, China and South Korea are closely monitoring the emerging inflationary pressures on their economies and hikes in interest rates could be expected across the Asia-Pacific region after Australia raised key interest rates, says Moody's economy.com. Australia is the first G20 country to raise interest rates yesterday, with the country's apex bank declaring recession over. The Reserve Bank of Australia (RBA) raised the official cash rate by 25 basis points to 3.25 per cent. "The Reserve Bank of Australia's interest rate increase this week likely kicks off rate hikes across the region in coming months. Speculation regarding imminent interest rate movements in the Asia-Pacific region has been growing," Moody's economy.com, said in a report. The ratings agency Moody's arm said apex banks in China, India and South Korea are keeping "a close watch on rising economic activity and emerging inflation pressures." Moody's observation comes ahead of the RBI’s quarterly review of monetary policy on October 27. Inflation is already close to one per cent mark by third week of September and there are expectations that it may breach six per cent by the end of the current fiscal. RBI Governor D Subbarao earlier this week said the central bank is faced with a dilemma whether to withdraw monetary stimulus or not since economic recovery is "incipient" and inflationary expectations are there in the economy. Moody's economy.com said as sentiment in global financial markets improves and signs emerge that global growth is resuming, it is inevitable that central banks in the region will raise interest rates from their current emergency levels. It added that though the nascent recovery in domestic demand, industrial production and exports across the region is encouraging, uncertainty regarding the global economic outlook remains pervasive. According to Moody's, gradually lessening the stimulus provided by monetary policy will be important in ensuring the sustainability of economic growth across the region and in keeping a lid on inflation pressures during the recovery. — PTI
	Dell to shut one US plant New York, October 8 Personal computer maker Dell will be closing down one of its manufacturing plants in the US early next year, a move that will affect nearly 905 jobs. The company would be shutting down its Winston-Salem desktop computer manufacturing plant by January 2010. “Approximately 905 employees will be affected by the closure, with about 600 to be released next month,” Dell said in a statement yesterday. The plant closure, being done as part of the firm’s efforts to simplify operations and improving efficiency, is expected to be complete by January 2010. The affected employees would receive severance packages, including severance pay, incentive payments, benefits continuation and outplacement services. Dell employs more than 78,000 persons. In January this year, the company announced the migration of its Ireland-based manufacturing operation to its Poland plant. Later in June, Dell sold its Tennessee re-manufacturing operation. — PTI
	Doha Round WTO meets begin in Paris New Delhi, October 8 The US seems to have manage its way on holding the Doha trade talks among smaller groups and on bilateral terms though several developing countries, including India, had opposed the idea. Negotiations on the contentious WTO issues, including agricultural subsidy and farmers' protection, are being held from today at Paris on bilateral basis rather than 20-30 trade ministers or negotiators meeting in groups. These are being held between the key WTO member countries including the US and other OECD (Organisation of Economic Cooperation and Development) nations, according to highly place sources. India, too, has sent its senior level negotiators headed by Additional Secretary in the Commerce Ministry D K Mittal. However, Commerce Ministry officials sought to allay concerns that the US negotiators are trying to encourage selective talks on multilateral issues. The US Trade Representative Ron Kirk had been selling the idea of consultations among narrow groups so that differences on the level of market opening and subsidy reduction can be easily resolved. During the New Delhi trade ministers meeting in September, Kirk had insisted that momentum to the trade talks could come only if discussions were held on within a limited number of players since it would be a complex process to find an agreement among 153 WTO members. However, the US did not find any support among the developing nations on limiting the consultations among the key players. The multilateral negotiations were revived in September here followed by officials' meetings at WTO headquarters in Geneva. — PTI
	ADAG threatens to sue DGH Sibal Tribune News Service New Delhi, October 8 Slamming claims that it poses a threat to oil and gas sector regulator VK Sibal's life, Anil Ambani group today said it would file criminal proceedings against the Director General of Hydrocarbons for "defamation and character assassination". "DGH's allegations against ADA Group are irresponsible, absurd and baseless," RNRL wrote to Home Ministry, reacting to Sibal's letter to the government wherein he had sought protection fearing threat to his life and his family members from the industrial house. Reliance ADA Group challenged Sibal to bring on record anything to support his "wild allegations," while adding that it would file criminal proceedings against DGH. When contacted, Anil Ambani group firm RNRL spokesperson confirmed writing a letter to the government in relation to Sibal's communication. Sibal's letter to the home and petroleum ministries on Tuesday coincided with ADAG moving Supreme Court alleging a nexus between him and RIL. ADAG has alleged that the nexus influenced Sibal to approve the increased capital expenditure in the Mukesh-led firm's KG-D6 gas fields. RNRL, in its letter to the Home Ministry today, sought comprehensive investigation into DGH approval for RIL's capex of over Rs 40,000 crore. It also claimed that the DGH's sole intent was to divert media attention from "his partisan act towards RIL." Alleging a "witch-hunt" by ADAG, Sibal had written: "ADAG is a corporate giant with unlimited resources. It is clear from the recent actions of this group that they are bent upon damaging my professional and personal life... in view of this I will not be surprised if ADAG resorts to violent means to achieve their objective. Therefore, I perceive a threat to my family members and myself." — PTI
	Re stronger by 32 paise Mumbai, October 8 Maintaining its gaining streak for the fifth straight session, the Indian rupee today gained another 32 paise against the US currency as dollar continued to be battered in foreign markets. Corporates and exporters continued to sell the US currency even as speculations were rife that the Reserve Bank may signal interest rate hike as the central bank is confronted with the issue of capital inflows amid a rising food inflation. The rupee ended at 46.34/35 a dollar. Forex dealers said dollar is being offloaded amid sustained capital inflows as the US currency is weak against its European and Asian rival currencies. Marginal recovery in the local equities amid expectations of increased portfolio inflows too helped the rupee to rise. — PTI
	US budget deficit accounts for 9.9% of GDP Washington, October 8 The US federal budget deficit has ballooned to a staggering $1.4 trillion, the highest since World War II, for the fiscal year 2009 as massive government spending and lower revenues widened the gap. Moreover, the deficit represents 9.9 per cent of the national GDP. According to the Congressional Budget Office (CBO), the budget deficit was about $1.4 trillion for the fiscal year ended September 30, which is $950 billion greater than the shortfall recorded in 2008. "The 2009 deficit was equal to 9.9 per cent of gross domestic product (GDP), up from 3.2 per cent in 2008, and was the highest shortfall-relative to the size of the economy-since 1945," the CBO said in a statement yesterday. Earlier, the deficit was projected to hit $1.6 trillion in the fiscal year 2009. The staggering shortfall between government revenues and expenditure was primarily on account of the huge Troubled Asset Relief Program (TARP) and the efforts to shore up the fortunes of beleaguered mortgage lenders Fannie Mae and Freddie Mac. As part of initiatives to bolster the ailing financial system, the US pumped in billions of dollars into banking entities through TARP. In addition, the government shelled out nearly $200 billion to rescue Fannie Mae and Freddie Mac. In September alone, the federal government recorded a deficit of $31 billion, where it was a surplus of $42 billion in the same period last year. — PTI
	40 Land Rovers recalled in India New Delhi, October 8 Tata group-owned Jaguar Land Rover (JLR) today said it is recalling 40 Land Rover vehicles from India to fix a technical fault as part of an ongoing global process that started in July. The company is globally recalling all vehicles of two diesel models -Discovery 3 and Range Rover Sport TDV6 - which were manufactured between November 2005 and April 2007. “We have 40 such vehicles in India, which are being recalled and fixed. The information for recalling the two models was posted during the end of July,” JLR spokesperson Paul Chadderton told PTI from Warwickshire in the UK. The company was recalling the vehicles as these had some safety concerns related to braking system, he added. “Our investigations had identified that oil may migrate into vacuum brake booster from the pump. So, we are fixing these and returning to the customers,” Chadderton said. This the second time in this year that JLR is recalling its products from the global markets. Earlier in August, it had recalled certain Jaguar XJ models from some international markets to rectify issues related to brake pipes but the Indian market was not affected. — PTI
	Rel Cap to venture into investment banking New Delhi, October 8 Anil Ambani group firm Reliance Capital today said it plans to enter investment banking space by the end of the current fiscal. "This is a missing link in the our business. We are aiming to set up the investment banking venture by the end of March 2010," Reliance Capital CEO Sam Ghosh told PTI. Reliance Capital has already secured merchant banking licence from the market regulator SEBI, he said, adding, the company would soon start the process of hiring top management for the business. When asked about the activity that the proposed venture would undertake, Ghosh said, "We can look at various things like advisory in merger and acquisitions, equity and debt, but we have not firmed up any plans on that yet." — PTI
	Per-second tariff to be optional, says TRAI Tribune News Service New Delhi, October 8 Clarifying on its earlier statement, telecom regulator TRAI today said operators would have to provide an optional tariff of per second call along with other packages or plans. Per-second billing will be one of the options that service providers have to provide," TRAI chairman JS Sarma said here when asked about the reactions from operators on the suggestions for per-second billing. Telcos have already expressed their displeasure over the move which is likely to further benefit the subscriber. Even though some of them already offer the scheme of per-second billing voluntarily, the telecom operators are of the view that government should not interfere in the market competition. Sarma said TRAI was preparing a consultation paper on the proposal which would be out in one-to-one-and-half months. Sarma said the idea behind the move is to bring in a plan for consumers which offers per-second billing. He said, "Operators can offer it along with other plans. It does not mean we will fix the tariff. When we make recommendation on this issue, we will keep in view the interest of operators as well as consumers."
	Direct Tax Code Commerce Ministry bats for SEZs New Delhi, October 8 The Commerce Ministry has written to Finance Ministry to retain all fiscal incentives for the special economic zones in the new direct tax code, for which draft paper has been circulated in the public domain. "We have told them (Finance Ministry) to continue the SEZ benefits in the new tax code," a senior Commerce Ministry official said. The ministry has underscored the need for continuation of the tax-free enclaves, stating that fiscal sops are the main attractions for the promotion of SEZs. The draft direct tax code that will lead to the overhaul of the Income Tax Act has created "uncertainty" among the developers and units in the SEZs. — PTI