The Tribune, Chandigarh, India

	Economy to grow by over 7 pc: Manmohan Bhubaneswar, December 27 With growth expected at little over seven per cent this fiscal, Indian economy is slowly gathering momentum that is essential to fight poverty, Prime Minister Manmohan Singh today. “The momentum was ...interrupted by the global economic crisis in 2008 and we slowed down to 6.7 per cent in 2008-09 and are likely to achieve 7 per cent or a little more in 2009-10," the PM said, inaugurating the annual conference of the Indian Economic Association here. The economy expanded by an average of 8.5 per cent between 2003-04 and 2008-09. “Our poor are still too poor and we need to do much more to improve their standard of living...To this end, the economy has to grow fast enough to create new job opportunities at a rate faster than the growth of labour force," the Prime Minister said. Finance Minister Pranab Mukherjee had said on December 23 that the economy could grow by 7.5-8 per cent, revising the earlier estimates of the government and the Reserve Bank. The Prime Minister said reforms had not led to any adverse impact on the country's poor but emphasised the system of governance needs to improve. “Overall, greater emphasis has to be laid on reforms of the systems of governance so as to reduce the scope for corruption,” he said. On the impact of economic reforms on poverty, the Prime Minister said opening up of the economy has had no adverse impact on the poor and the percentage of population below the poverty line continues to decline. “There is no evidence that the new economic policies have had an adverse effect on the poor. However, I would readily agree that what has been achieved is not enough. Much more needs to be done.." he said. The PM said economists had recently argued that the poverty line itself should be raised. “If this is done, the percentage of population in poverty is obviously higher. But this does not mean that the percentage below the poverty line is not declining." According to the Planning Commission, 27.5 per cent of over one billion Indians live below the poverty line based on the last estimates in 2004-05. However, a committee, headed by former chairman of Prime Minster's Economic Advisory Council Suresh Tendulkar, has proposed to revise the guidelines for defining those below poverty line. If the 2004-05 poverty estimate is revised as per the proposed guidelines, those below the poverty line would increase to 37.2 per cent from 27.5 per cent. However, the Prime Minister said since the period of rapid economic growth was largely after 2004-05, it would be only through the next estimates of 2009-10 that the real impact on poverty would be known. — PTI
	Forgettable scam, historic car made news in 2009 New Delhi, December 27 From a technocrat-turned-fraudster Ramalinga Raju's confession to the snub-nosed Nano, 2009 offered some forgettable and many memorable moments in business. Not just the domestic turf, in the international arena too, India had its share of fame. Indians like banker Chanda Kochhar and cola queen Indra Nooyi emerged among the world's powerful, while Nagpur-born Vikram Pandit managed to remain at the helm of crisis-ravaged Citigroup. And the high profile tussle between Ambani brothers - Mukesh and Anil - made headlines, with the siblings’ battle over the pricing of gas from KG Basin moving to the Supreme Court. Shocking the corporate world, former Satyam Computer Services chairman Ramalinga Raju admitted to cooking up the company's account books over a period of nearly seven years - a period when he is estimated to have allegedly syphoned off nearly Rs 10,000 crore. Making the Indian middle class dream of owning a car affordable, Ratan Tata's launched Nano - the Rs one-lakh car-, billed as the cheapest in the world. Reflecting Indians' growing clout in the international stage, ICICI Bank chief Chanda Kocchar was named among the 100 most powerful women globally by Forbes magazine. India-origin Nooyi, was named the most powerful woman in the US business by Fortun. Globally, the Wall Street's cup of frauds brimmed with Madoffs and Rajaratnams. Once-revered trader Bernard Madoff admitted to cheating investors to the tune of $50 billion. He would now spend the rest of his life in jail, serving 150 years of imprisonment. Another billionaire Sir Allen Standford was accused of swindling as much as $8 billion. Rajaratnam, the founder of Galleon hedge fund, has been indicted for insider trading activities, which resulted in profits worth $21 million. — PTI
	Rally brings back optimists into stock markets Shiv Kumar Tribune News Service Mumbai, December 27 Year 2009 has been a rollercoaster ride for investors. The Sensex fell to its lowest point in three years testing 8,000 levels wiping out all gains made by investors during the latter half of the decade. The bubble simply gave out of scrips that were being quoted ahead of valuations wiping out scores of small investors who venture into the markets solely on the basis of tips rather than study of individual companies. But the decisive victory of the Congress in the Lok Sabha elections gave a second wind to investors and the bulls were back in the ring. But smart investors, who purchased aggressively during the sharp market fall early this year, were amply rewarded with several mid and small cap stocks. Vinod Ohri of Gupta Equities points out that emerging markets like India are expected to show better results as compared to developed markets. “The way the stocks have moved in last one year, the name emerging markets sounds like an understatement.” Ohri, however, noted that much of the move may be attributed to the abundant liquidity and stimulus packages announced by the governments of many countries. The doubting Thomases who were predicting the Sensex to touch 6,000 levels in March have now swung the other way and predicting the markets to touch newer highs. As for the start of 2010 there could be newer players, says Ohri.
	Millions in UK face pay freeze, cuts in 2010 London, December 27 The new year is going to be a cold one for the salaried class in Britain as millions of people are likely to see their spending power slashed again in 2010 due to salary cuts and pay freezes, a media report says. Up to two-thirds of companies in the private sector are planning to freeze or cut pay next year - a substantial increase compared with this year, The Sunday Times said. Quoting a poll by the British Chambers of Commerce (BCC), the daily said 58 per cent of company directors were planning wage freezes during 2010 and another 5 per cent planned to cut pay next year. This grim forecast has, however, enraged union leaders and brought a series of strike-threats for slashing workers' spending power for the second year running. The unions said economy should not be used as an “excuse” to impose pay freezes by companies continuing to make profits. Derek Simpson, joint general secretary of Unite - biggest trade union in Britain - with two million members said: “Our members have been prepared to share the pain and take pay freezes this year. But we will challenge any attempt to freeze pay in companies that are making profits next year." British Airways, Hewlett-Packard, Fujitsu, Swinton insurance and Ladbrokes have already announced plans to freeze pay next year. Citing BCC director general David Frost the daily said: “We face a tough year ahead - it will be a really long haul.” Despite signs of economic growth, millions of consumers face a bleak 2010. Value added tax (VAT) is set to rise to 17.5 per cent this week, unemployment is expected to increase further and City forecasters predict interest rates to rise later in the year. Personal tax allowances will be frozen in April when the new 50 per cent income tax rate also comes in, the report added. — PTI
	MoD may release more spectrum Tribune News Service New Delhi, December 27 The Ministry of Defence (MoD) may release more spectrum needed for the auction to start 3G services. The hope stems from the fact that the Cabinet has given approval for laying an alternate dedicated network for the defence. Department of Telecom officials are hopeful that this would encourage the MoD to release more spectrum. The alternate optical fibre project will enable the defence to release more radio waves. However, there is already a shadow over the auction with the government deciding to allocate spectrum for 3G services by August next year only. The delay of over two years in the starting of the process has had some of the telecom operators looking for a better options that would be available by the time they are in a position to actually role out 3G services. Reports suggest that some of the private telecom operators are reviewing their strategy and may overlook 3G. This could actually put a spanner in the government’s plans to garner about Rs 30,000 crore from the auction.
	Tax Advice PPF a/c can be extended for any number of years by S.C. Vasudeva Q Kindly guide me for the following: a) In PPF -15 years account, period of first extension b) Present rate of interest per year c) Interest is to be compounded yearly or half-yearly d) Minimum amount that is to be deposited in a financial year e) Maximum amount that is to be deposited in a financial year f) Should be deposited in monthly instalments or lump sum g) How much period, it should be applied for extension, before the expiry of first 15 years. — Hari Singh A Your queries are replied hereunder a) The account can be extended for any number of years. However, each extension is for a block period of five years b) The present rate of interest payable in such account is 8% per annum c) The interest is allowable for each calendar month on the lowest balance at the credit of the account between the close of the fifth day and the end of the month and is credited at to the account at the end of each year. The interest is, thus, compounded annually. d) The minimum amount that has to be deposited in a FY is Rs 500. e) The maximum amount that can be deposited in a PPFaccount is Rs 70,000. f) The amount can be deposited in instalments or in lump sum. g) A subscriber can exercise an option for the extension beyond a period of 15 years. Such extension has to be before the expiry of one year from the end of the year in which the initial subscription was made. House tax Q I am a salaried person. I pay rent (Rs 60,000) to my mother, who is the owner of the house. Does the relationship matter in exemption in HRA for tax purposes? Will my mother have to pay any tax on this receipt of rent (only income of her) or will it add in my father’s income (a pensioner)? — Manoj Sharma A Your queries are replied hereunder: a) Provisions of the Income-tax Act, 1961, do not prohibit the actual payment of rent to the mother (owner of the house) for the purposes of getting exemption of house rent allowance received by a taxpayer. b) The amount received by your mother shall have to be reflected as income from house property in her return. Such income would be taxable in her hands provided she is the owner of the house in the real sense i.e. the house has been constructed with her funds and her ownership stands accepted in the tax records. Joint nominee Q I am a retiree and a senior citizen. I have some fixed deposits in a bank. Previously, these deposits were in the names of my wife and me. We had made our NRI son the nominee. Last year, when our son visited India, I got his name included in our savings bank account. On the basis of that I am now including the name of my son as a joint holder in new deposits. Kindly advice if what I am doing is legally right. We are including our son’s name for his convenience. Being an NRI will he have any problem in transferring the money to his account in Canada where he is settled? — BK Malhotra A You have not done anything incorrect by including the name of your son as another joint holder in the bank account. It should be possible for him to remit the amount to Canada without any problem subject, however, to a limit of $2,00,000 per year. Cost inflation index Q Please intimate LTI for 2006-07, 2007-08 and 2008-09. — Dr HBD Pasrija A The cost inflation index for the financial years referred to in your query is as under: 2006-07 — 519 2007-08 — 551 2008-09 — 582