The Tribune, Chandigarh, India

	Exports in July rise 13.2 pc * Much lower than witnessed in the first three months of this fiscal * Exporters told be prepared for slowdown New Delhi, August 17 India's exports grew by 13.2 per cent in July to $16.24 billion year-on-year, a rate much lower than witnessed in the first three months of this fiscal because of the fading base effect. The slowdown in the growth rate may continue for the rest of the fiscal as the developed countries may go for fiscal consolidation by partially rolling back the economic stimulus packages, Commerce Secretary Rahul Khullar told reporters. The rollback would contract demand in the developed markets, which are the mainstay of India's exports, he added. In any case, the growth rate has started falling as it is now being calculated on a higher base of 2009-10, after the shipments started improving on signs of the global economic recovery. "(Despite) all hoopla about 30-35 per cent (export growth), the reality is 13.2 per cent (in July). Basically, what is happening (is) that the base effect is wiped out," Khullar said. Due to the low base effect, India's exports showed robust rate in April (36.2 per cent), May (35.1 per cent) and June (30.4 per cent). Khullar further said in the second half of 2010-11, exports would shrink due to aggregate demand contraction overseas and roll back of stimulus in the developed world. "There is going to be a slowdown in the world in the next six months...that will translate into contraction in aggregate demand of our exports," he added. The secretary asked the exporters to remain prepared for slowdown in their dispatches in the coming months. However, Khullar said India would be able to meet the export target of $ 200 billion this fiscal. Exports in the last fiscal totalled $182 billion. "We are on the track. Even if we post a 14-15 per cent growth for the remaining period of the year, we will reach $ 200 billion," he added. Due to the global demand slump, the country's exports started contracting in October 2008 and entered into positive territory after 13 months in November last year. Overseas shipments in April-July this fiscal aggregated $ 68.63 billion, up 30.1 per cent over the same period last year. — PTI
	Merc unfolds new E-Class at Rs 64.5 L New Delhi, August 17 Bidding to strengthen its position in the Indian luxury car market, Mercedes Benz today launched a new version of its E-Class priced at Rs 64.5 lakh (ex-showroom Delhi). The new car E-Class Cabriolet — a four seater convertible with soft top -- is the seventh offering within the E-Class range by the company in India. "With its launch, the versatility of the E-Class range is further reinforced. The E-Class now offers the Cabriolet in addition to the already present E-Class Saloon and the E- Class Coupe," Mercedes Benz India MD Wilfried Aulbur said. The existing E-Class range offered by the company in India is priced between Rs 42 lakh and Rs 50 lakh. As per the data released by the Society of Indian Automobile Manufacturers, Mercedes Benz has beaten compatriot BMW in the race for the top spot in the Indian luxury car segment with a massive 79.31 per cent jump in sales to a total of 2,921 units in the January-July period as against 1,629 units in the same period last year. Skoda’s small car in 2012 Czech car-maker Skoda today said it would introduce a small car in the Indian market in early 2012, which will be priced at Rs 3-5 lakh. The company, a part of the Volkswagen group, will also introduce its sports utility vehicle, Yeti, and a stripped-down version of its premium hatchback, Fabia, in India by the end of this year. In addition, it will launch a sedan with a Rs 6-10 lakh price tag in 2011. "We had announced to roll out one new model every year. As part of this strategy, we will enter the volume segment and will launch a small car in early 2012," SkodaAuto India board member and director (Sales and Marketing) Thomas Kuehl told reporters here. The development of the car is underway and the company will launch the model in both petrol and diesel versions. When asked about the possible price range of the vehicle, he said: "It will be below the Fabia... Our aim is to price in the Rs 3-5 lakh category." The over 15 lakh units strong Indian passenger car market witnesses most of its sales coming from the small car segment and global car majors have launched a slew of new models in the Rs 3-5 lakh bracket in recent months, including Ford’s Figo, General Motors' Beat and Volkswagen's Polo. — PTI
	Fitch cuts Vedanta’s rating New Delhi, August 17 Fitch Ratings today cut the credit rating of Vedanta Resources, citing risks arising out of its entry into a new business with the group's proposed $ 9.6-billion deal to acquire Cairn India. "The downgrades reflect the substantial size of the Cairn India acquisition, in relation to Vedanta's existing cash flows and debt levels, as well as the added risk of the latter's lack of track record in the oil and gas sector," Fitch Ratings said in a statement. The agency has slashed Vedanta's long-term issuer default rating (IDR) to “BB+” from “BBB-”, indicating higher risk of default. Further, the company has been placed on negative rating watch. Meanwhile, Standard & Poor's has placed Vedanta's long term corporate credit rating “BB” on credit watch with negative implications, in the wake of the Cairn deal. "(The action) reflects our view that the proposed acquisition could significantly increase Vedanta's debt and weaken its financial risk profile to levels below our expectation for the current rating," S&P Ratings Services said today. "As a consequence, Vedanta will heavily rely on Cairn's existing management team to ramp up oil and gas production and make a meaningful contribution to Vedanta's earnings," Parker added. Fitch has also downgraded the ratings on Vedanta's $ 500 million bond, due in January 2014, as well the $750 million bond, due in July 2018. In addition to placing these bonds on negative rating watch, the rating has been cut to “BB” from “BB+”. — PTI
	Offer for Cairn shares opens on Oct 11 Shiv Kumar Tribune News Service Mumbai, August 17 Sesa Goa, the iron ore mining company which is part of Anil Agarwal's Vedanta group, has made an open offer for the shares of Cairn India. The open offer for 20 per cent of the stake in the Indian arm of the Scotland-based Cairn Energy will begin on October 11, Sesa Goa announced here today. In all, Sesa Goa will shell out Rs 13,631.48 crore at the rate of Rs 355 per share if the open offer is fully accepted by shareholders. The open offer closes on October 30. “The share acquisition will be made mainly from our cash reserves. Right now, we have $2 billion for the purpose. By the last quarter of the current fiscal, when we think the share purchase will be completed, we can have entire $3 billion for buying the shares,” P K Mukherjee, the MD of Sesa Goa said in a conference call ahead of the offer.
	Indian Bank hikes FD rates Chennai, August 17 Indian Bank has hiked the interest rates on its deposits of Rs 5 crore and below the maturity of two years and above by 50 basis points from 7.25 per cent to 7.75 per cent, the bank said today. The new rates are effective from August 15, which also marks the bank's 104th Foundation Day, Indian Bank said in a statement. The bank also introduced two new fixed maturity deposit products, "Indouble" and "Indouble Senior", which doubles the principal amount in 100 months and 108 months, respectively. All other facilities, including nomination, premature withdrawal and loan against deposits to normal fixed deposits, have also been extended to these products, it added. Kotak Bank ups lending rates Mumbai: Kotak Mahindra Bank today announced an across-the-board upward revision of its lending rates by 0.25 per cent to 16 per cent with immediate effect. The bank has also increased its fixed deposit rates by a similar percentage point in various retail buckets up to one year. The bank was offering a (benchmark prime lending rate) BPLR-linked lending rate at 15.75 per cent. The SBI and ICICI yesterday increased their lending and deposit rates by 50 basis points. While the State Bank's revised rate now stands at 12.25 per cent from 11.75 per cent, its deposit rates went up by 1.5 per cent, ICICI lending rate is at 16.25 per cent now. — PTI
	Luxury tax hits Punjab hotels Ruchika M. Khanna Tribune News Service Chandigarh, August 17 The luxury tax imposed by the Punjab government should be in consonance with the tax imposed in the neighbouring states of Haryana and Himachal Pradesh, as this is affecting the hotel business in the state. Since 2009, Punjab has imposed a luxury tax of 4 per cent on hotels, restaurants and banquet halls. In case of hotels, luxury tax is payable on rooms which have tariffs of over Rs 500 per room per day. In comparison, Haryana and Himachal Pradesh impose luxury tax of 10 per cent on hotels, where the room tariff is over Rs 2000. “The practice of imposing luxury tax on all hotels where the room tariff is as low as Rs 500 has adversely affected the hotel industry in Punjab, especially the small hotels. At a time when the tourist inflow is already low in the state, small hotels in Punjab are facing a closure. Only the big hotels can now manage to sustain business and grow,” said Surinderjit Singh, executive member, Hotel and Restaurant Association of North India (HRANI). Punjab had initially imposed a luxury tax of 8 per cent, which was slashed to 4 per cent after protests by the hotel industry. The industry had then claimed that there were a few tourist destinations in the state, which meant fewer tourists staying in the hotel and the high tax would act as a deterrent. Gurwinder Singh, treasurer, Federation of Hotel and Restaurant Association of India (FHRAI), said the issue would be taken up during the annual convention of the association to be held at Agra on August 27-29, with Union Tourism Minister Ambika Soni. “Besides, the issue of charging high liquor licence fee from bars operating in malls in Haryana will also be taken up. Those operating pubs/bars in malls are being charged a liquor licence fee of Rs 25 lakh per annum, which is the same as is being charged from five star hotels. At a time when the government should be promoting the tourism industry, they are creating roadblocks for our business,” he rued.
	Satyam wins lawsuit against UK’s Upaid New Delhi, August 17 Mahindra Satyam yesterday said a New York court had given a favourable judgment in its lawsuit against Upaid Systems and ruled that the British company was responsible for all tax liability on the settlement amount of $ 70 million paid by the IT firm. "The court adjudged and declared that the Settlement Agreement required that Upaid must cooperate with the Escrow Agent (IDBI Bank) to allow the Escrow Agent to withhold any applicable taxes from the $ 70 million settlement amount," Mahindra Satyam said in a statement. Mahindra Satyam, earlier known as Satyam Computer Services, had filed a lawsuit in a New York court against Upaid, seeking enforcement of a legal settlement agreement between the two signed in December 2009. At issue is the tax liability on the settlement amount, which Satyam claims is Upaid's responsibility under the agreement. In the lawsuit, Satyam had asked the court to confirm that Upaid was responsible for any tax liability arising from the settlement. In December 2009, Satyam agreed to pay $ 70 million to settle all outstanding legal disputes with Upaid. As part of the December agreement, Satyam entered into an escrow agreement with Upaid and deposited the settlement amount of $ 70 million into an escrow account. — PTI
	Bharti to invest $10m in Seychelles Abuja, August 17 Bharti Airtel has announced plans to invest $10 million in its newly acquired telecom network in Seychelles. The company will also participate in the Seychelles East Africa submarine cable (SEAS) project. During a meeting with vice-president Danny Faure of the country yesterday, Bharti Airtel Africa CEO Manoj Kohli said the investment would be phased over the next three years. Meanwhile, Nokia and Bharti today joined hands to launch Ovi Life Tools service targeted at providing Airtel’s mobile customers with access to relevant content on agriculture, education and entertainment. Airtel mobile services customers can now subscribe to Ovi Life Tools starting at Rs 10 per pack. — PTI/TNS
	Coca-Cola launches milk mango drink Kolkata, August 17 Coca-Cola today marked its entry in the dairy segment with the launch of a milk-based mango drink. "We have entered the dairy segment after China and Vietnam," Ricardo Frost, vice-president of Coca-Cola India, said here today. He said the company did not have any plan to introduce any other milk-based beverage in the near future. The product, Maaza Milky Delite, had been launched for the first time in Kolkata. The national rollout of it would take place after the product's test marketing in Kolkata. The product will be manufactured at the company's bottling plant at Taratolla. — PTI