The Tribune, Chandigarh, India

Inflation surges to 10.55%

New Delhi, July 14
Spurred by an increase in oil prices, the overall inflation continued its double-digit run for the fourth straight month in a row at 10.55 per cent in June, mounting pressure on RBI to raise key interest rates in its July policy review. The wholesale price-based inflation, which was above 11 per cent in March and April, inched up by 0.39 percentage points in June. It was in the negative at 1.01 per cent in June 2009, government data showed.

Finance Minister Pranab Mukherjee, however, exuded confidence that inflation would fall to 5-6 per cent by the year-end with the advent of kharif crop in the market.

"It (inflation) is hovering around double digit. After Kharif season is over there will be a moderating impact which is already being felt," he said.

To combat inflation, the RBI had raised policy rates thrice this year and experts peg another 25 basis points hike in its scheduled monetary policy review on July 27.

"July figures would be slightly higher. The RBI may raise policy rates by another 25 basis points. Post July, we could see some dip in inflation as the base effect starts waning," PMEAC member Govinda Rao said.

The double-digit inflation in June could be partly attributed to low base in the year-ago period when the inflation was in the negative, which means even a small increase would seem large. Economists expect prices to cool from August as the base effect impact starts fading.

"Food prices are gradually softening. July figures will be high as the full impact of fuel price hike would be passed through," Rao said. The country's chief economic adviser Kaushik Basu had last month said that he expects the hike in fuel prices to lead to one percentage point rise in inflation.

In June, the fuel index rose by 1.7 per cent, due to higher prices of kerosene (9 per cent), electricity (4 per cent), petrol (2 per cent) and liquefied petroleum gas (3 per cent).

Food prices rose marginally by 0.20 per cent in June as prices of cereals, rice and wheat declined on a month-on-month basis. Among manufactured items, wood products prices rose by 5.4 per cent due to higher rates of plywood commercial planks. — PTI

Prices to ease by Dec: Montek

The plan panel on Wednesday said fuel price hike will further increase inflation in July, but it will fall below double digits by the end of December.

"I think although there will be an adjustment upward (in inflation) when fuel price hike gets fed in July numbers... I don't alter my conclusion that at the end of the year it will be low," Planning Commission Deputy Chairman Montek Singh Ahluwalia told reporters on the sidelines of an Indo-Oman event.

He said that inflation will be well below double-digit by the end of this year. "You will see more decline as time goes by," he said.

Piramal sells diagnostic arm to SRL for Rs 600 cr

Mumbai, July 14
Piramal Healthcare today said it will sell its diagnostics unit to Super Religare Laboratories (SRL) for Rs 600 crore, nearly two months after selling its domestic solutions business to Abbott for Rs 18,000 crore.

In a statement Piramal Healthcare said it has entered into an agreement with SRL, promoted by billionaire brothers Shivinder and Malvinder Singh, to sell the diagnostics arm — Piramal Diagnostic Services Private Limited (PDSL).

Commenting on the deal, Piramal Group chairman Ajay Piramal said: "We feel it is the right time to take the business to the next level and this development will give it the scale and size to serve a much larger base of Indian customers with a high level of quality and care." Piramal Healthcare will receive Rs 300 crore on closing of the deal and the balance over a period of three years.

It will also continue to be involved in the business, including by way of representation on the Board of Directors and the Executive Committee of SRL, the statement added.

The deal follows Piramal's selling of its domestic solutions business for $3.72 billion (about Rs 18,000 crore) to US-based Abbott in May.

For SRL, the deal will make it the country's largest diagnostic services provider by acquiring PDSL's network of 107 laboratories, with an FY'10 revenue of over Rs 200 crore, the statement said. — PTI

Oil PSUs agree on uniform petrol rate
To revise price monthly

New Delhi, July 14
State-owned IOC, BPCL and HPCL today decided to have a uniform petrol price despite government giving them freedom to price the fuel and said they will revise prices once a month based on input cost.

The three retailers will once in a month "coordinate" on pricing of petrol based on international price trend of crude oil and gasoline, Indian Oil Corporation Director (Finance) SV Narasimhan said.

"All the three oil marketing companies will have uniform price," he said.

The decision to allow IOC, Bharat Petroleum and Hindustan Petroleum to function as 'informal' cartel was taken at a meeting called by Oil Secretary S Sundareshan. The meeting was called to decide on the modalities of how petrol will be priced after it was freed from the government control.

"Petrol price on June 25 was raised by Rs 3.50 per litre following price decontrol instead of Rs 3.73 a litre required to align them with cost," Narasimhan said.

Subsequently, international oil prices declined, wiping away most of losses. "We have reviewed the situation and as of now there is no need to revise petrol prices," he said.

On June 25, an Empowered Group of Ministers headed by Finance Minister Pranab Mukherjee had also decided to free diesel prices from government control but raised rates only by Rs 2 per litre instead of Rs 3.80 per litre required to align them with international cost.

The gap between retail selling price and international cost widened subsequently to Rs 3.14 per litre from Rs 1.80 a litre at the time of price hike. This has subsequently come down to Rs 1.70-1.80 per litre now.

"There is no decision or move to revise prices of diesel at this juncture," Sundareshan said. Narasimhan said the oil companies do not feel the need for revising rates of petrol now and will review the situation possibly by the month-end. From now only, pump rates will be revised once a month.

The three companies will have a uniform rate for petrol in particular cities or locations, and it would change on the same dates.

Three PSUs have already held discussions with private retailers, Reliance Industries, Essar Oil and Royal Dutch/Shell, on modalities such as frequency and intervals at which prices would be revised. — PTI

Bajaj Auto plans bonus shares

New Delhi, July 14
Nearly 13 years after it last issued bonus shares, India's second largest two-wheeler maker Bajaj Auto today said it is planning a similar move - for which its board will meet on July 22.

The announcement drove the company's scrips to an all-time high of Rs 2,461.70 per share on the BSE during the afternoon trade, up 2.15 per cent from the previous close.

"A meeting of the board of directors of the company will be held on July 22 to consider a proposal for declaration of bonus shares, subject to approval by shareholders," Bajaj Auto Ltd said in a filing to the BSE.

The company, however, did not elaborate on the details of the bonus shares to be issued.

According to information available on the official website, the last time Bajaj Auto Ltd (now known as Bajaj Holdings and Investments Ltd) had made an announcement of the sort was in October 1997, when it issued bonus shares in the ratio of 1:2. — PTI

Reliance moves Competition Commission
Alleges oil PSUs acting as cartel in ATF supply

New Delhi, July 14
Reliance Industries has moved the Competition Commission of India alleging state-owned oil firms IOC, BPCL and HPCL have formed a cartel to supply aviation turbine fuel (ATF) to Air India.

According to official sources, RIL has filed a complaint stating that the government-owned oil marketing companies worked as a cartel while bidding for ATF supply to flag carrier Air India.

It is learnt that RIL wants to enter the business of jet fuel supply, which is in the hands state-owned oil marketing companies.

"The complaint has been filed under Sections 3 and 4 of the Competition Act, which pertains to anti-competitive agreement and abuse of dominant position, respectively. The commission will consider the complaint by RIL in a week," a source said.

When contacted an RIL spokesperson said: "We do not wish to comment." National Aviation Company of India (NACIL), which runs Air India, regularly floats tenders for supply of ATF.

RIL's move coincides with the widespread anticipation that the PSU oil firms will continue to act as a cartel while revising petrol prices every month in the free pricing regime, which looks set to kick in as early as this week.

Petrol prices were freed from government control last month, resulting in a Rs 3.50 per litre rate hike in Delhi.

However, the modalities of subsequent retail price adjustments - in line with changes in crude - were left for the industry to decide. — PTI

Schemes to cut consumption of power in Punjab, Haryana
Ruchika M. Khanna
Tribune News Service

Chandigarh, July 14
The Bureau of Energy Efficiency (BEE) is betting big on the energy-deficient states of Punjab and Haryana so as to bring in energy efficiency in the use of electrical appliances. Other than launching its ambitious Bachat Lamp Yojana (wherein free CFLs are given to power consumers) in Punjab, the Bureau also proposes to launch Municipal Demand Side Management in the two states to bring in energy efficiency in the use of street lights.

The two schemes, when implemented, will help bring down the power consumption by almost 30 per cent. Talking to TNS on the sidelines of a conference on Standards and Labelling for air-conditioners, Sandeep Garg, energy economist, BEE, said the Municipal Demand Side Management (MUDSM) project had already been initiated in seven districts each of Punjab and Haryana. “We have now chosen Punjab and Kerala to launch our Bachat Lamp Yojana (BLY). While the scheme has already been implemented in Kerala, in Punjab, the project will be implemented in two phases, and 192 lakh CFLs will be distributed to power consumers,” he said.

The Punjab government has already roped in three investors for implementing the scheme, and a tripartite agreement between the investors, Punjab government and Powercom, is expected to be signed shortly. The three investors will supply the CFLs at Rs 15 each to the consumers, and will recover the remaining cost through selling of carbon credits earned through saving power by replacing electric bulbs with CFLs. In the first phase, 112 lakh CFLs will be distributed in 16 circles, while 80 lakh CFLs will be distributed in seven circles during the second phase of implementation.

Talking about the MUDSM project, Garg said the project was aimed at bringing down the power consumption of street lights by bringing more efficient lighting system and adjusting the intensity of the light at different hours of the night. This is being implemented in Amritsar, Gurdaspur, Jalandhar, Kaputhala, Ludhiana, Patiala and Bathinda in Punjab. “In Haryana, this is being implemented in Ambala, Faridabad, Karnal, Fatehabad, Rohtak, Sonepat and Panipat. In most of the cities, we have already completed an audit of the street lights and based on this, a detailed project report will be worked out by Energy Services Companies on how to make them more energy efficient,” he said.

He also said a project to introduce LEDs for street lighting in Ludhiana had been approved. A similar demonstration project was also being introduced on the Madhya Marg in Chandigarh.

HDFC profit up 23 pc

Mumbai, July 14
The country's largest mortgage lender, Housing Development and Finance Corporation (HDFC), today reported a 23 per cent growth in net profit to Rs 694.59 crore for the first quarter ended June 30, 2010.

The housing lender had a net profit of Rs 564.92 crore in the June quarter of the previous fiscal, HDFC said in a filing to the Bombay Stock Exchange.

The total income, however, declined to Rs 2,801.95 crore during the quarter from Rs 2,849.07 crore in the same period of the last fiscal.

Shares of HDFC closed at Rs 3,074.95, up 0.38 per cent on the BSE. — PTI

Rubber prices via SMS
Tribune News Service

Jalandhar, July 14
In an effort to provide daily rubber prices to its subscribers through SMS, the Rubber Board of India has introduced a subscription-based service to its registered subscribers.

Babu Raj E.G., Excise Duty Inspector of the board, informed that the service will be provided to its registered subscribers only. The international prices of rubber will be sent via SMS to the subscribers at 11 am while the domestic prices will be sent at 4 pm everyday.

The unregistered subscribers, desirous to avail the facility, can send a request letter containing self address, PIN code and mobile number to the Deputy Director (Marketing), Market Promotion Department, Central Lab Building, RRII Campus, Kottayam along with a demand draft of Rs 300 favouring The Rubber Board at Kottayam.

Northern states, including Haryana, Punjab, and Delhi, consume almost 60 per cent of the total rubber produced in the country while Kerala is the main rubber-producing state and contributes 95 per cent to the national rubber production.

TCS, Wipro, Infy vie for IRDA project

New Delhi, July 14
Indian IT giants, including TCS, Infosys and Wipro, have been shortlisted by insurance regulator IRDA for technical bidding to implement its enterprise resource planning (ERP) system.

The pre-bid meeting to select the IT partner for implementing the project will be held tomorrow, IRDA said.

Besides TCS, Infosys and Wipro, three other firms, including Intelligroup, Mahindra Satyam and Deloitte, have also been selected for the technical bidding. ERP is an integrated software, which will cover and customise IRDA's various activities, including human resource management, accounting, payroll administration, data bases, and other tools and accessories. IRDA has 11 departments and the integrated software system is expected to streamline operations between them. — PTI