New Delhi, December 10
In the season of scams and corporate wars, Finance Minister, Pranab Mukherjee today cautioned India Inc on the importance of ethics, integrity and corporate governance while conducting business and said that companies need to look beyond just quarterly profits.

Addressing the 90th annual session of industry body, Assocham here today, the Finance Minister used the opportunity to drive home the message to the corporate sector that ethics in business will be a significant differentiator and businesses should not push the single agenda of profit maximization.

The Finance Minister has stirred the debate on ethics and corporate governance in business at a time when India is facing an overhang of scams and corporate wars and the issue of corruption has taken centre-stage. From telecom to stock markets, scandals are breaking out and high voltage corporate wars are being fought which has spooked investors and governance has been affected.

Mukherjee reminded the corporate sector about the lessons from the global financial crisis and said that failure to adhere to prudent norms of corporate governance ultimately led to the demise of several multinational corporations.

He said that companies should not focus just on maximising shareholder value at all costs. He said there is a need for greater integrity in branding, advertising and marketing and in every realm of business.

Hinting at the recent controversy over the practices of micro finance institutions, Mukherjee said that all financial institutions in general and banks and micro finance institutions in particular should be careful while selling their products to vulnerable segments of the society. “Financial inclusion should not be mis-lending or mis-selling. In a society like ours where literacy levels are low it is the onus of the sellers of financial products to go beyond checklist compliance and ensure suitability of a product to prevent mis-selling in the market”, he said.

The FM said that the corporate governance debate is moving from the effects of bad governance on minority and small shareholders to the effects on all stakeholders. “Company boards and management are concerned with the near term - often as near as the next quarter. They live from quarter to quarter. I would like to caution boards that they should not ignore the longer term consequences of their behaviour on other stakeholders”, he said.

Companies need to balance the interests of different stakeholders, he said and raised some serious questions for companies that seek to sell their products at all costs. “Should a company invest in green technology that may not be economically viable in the short term but will reduce adverse impact on the environment in the long term? Should a company make durable products that last long or go for high repeat sales? Should a company add and charge for superfluous features in its products even though it knows very well that only a fraction of consumers will use them? Such issues need to be considered seriously”, he said.

Asking companies to focus attention on rural India, he said business and markets have to be equally sensitive to the needs and desires of rural India. He said that rural market in India has saved the woes of many in urban India.

He said that in a market such as ours, there is scope for innovation in creating a distribution network to reach various products to a large number of people. He further said that indeed the gains to be reaped from innovations in product distribution may be far greater than gains in product innovation.

Alluding to the global crisis which led to downfall of many MNCs, he said, “The global financial crisis has revealed certain gaps in the functioning of vital elements of the financial markets including corporate boards, credit rating agencies and auditors. Serious concerns have emerged on behavioural disposition of major market players. Even though they operate in a competitive market ambience, they are expected to be responsible risk- takers, balancing entrepreneurial impulses with fiduciary responsibilities”, he said.

Brussels, December 10
India and the European Union today vowed to resist all forms of protectionist measures in the global trade as they reached the last stages of concluding a market opening bilateral trade and investment agreement.

After the EU-India Summit, attended by Prime Minister Manmohan Singh and top European Commission leaders, a joint declaration said that the two sides "agreed on the contours of a final package, and reaffirmed the importance of an ambitious and balanced" conclusion of Broad Based Bilateral Trade and Investment Agreement (BTIA).

Billed as the biggest trade opening agreement by the EU, and one of the biggest bilateral pacts ever, the BTIA will reduce duties on mutual trade, which aggregated about euro 56 billion (about $75 billion) in fiscal 2009-10.

The leaders decided to speed up negotiations so that BTIA could be concluded in the spring of 2011.

"We are at the last stages of this complex exercise. We have directed our officials to redouble their efforts to reach a conclusion by the spring of 2011. Finalisation of a balanced agreement will bring enormous benefits to both sides," the Prime Minister said at his press conference.

While the EU is keen on gaining bigger market for its products in India, Singh allayed apprehensions about its impact on the on small farmers in the country.

Singh further said the two sides should take lead in avoiding protectionist trends, keeping markets open and encouraging the free flow and movement of people.

India has concerns over restrictions of movement of people in several European countries like the UK and Germany. It's apprehensions were partly addressed in the joint statement.

"Recognising the important implications of the movement of people for India and EU, they (leaders) agreed to explore initiatives that could lead to a regular, comprehensive and structured dialogue on migration issues, with a view to deepening cooperation in this field," it said. — PTI

New Delhi, December 10
Taking a serious view of the unavailability of iron ore, coal and other minerals for domestic use, Parliament’s Committee on Public Undertakings (COPU) has called for a blanket ban on the export of raw minerals, especially iron ore. It also wants a National Policy governing mineral use. The committee, which reviews the performance of PSUs to help them achieve optimum performance, has asked the government to revisit the National Mineral Policy 2008. The policy envisages the regulation of mines and development of mineral resources, but does not quite address the critical issue of depletion of mineral resources due to injudicious exports and indiscriminate illegal mining. The issue has also forced tribals to take to Naxalism in mineral rich states.

These observations form part of the latest COPU report, for which studied the performance of Vishakapatnam Steel Plant (Rashtriya Ispat Nigam Ltd). It found that the Navratna, which bounced back from its sick status in 2002 to 2003, is facing iron ore shortage for production.

“The plant has no captive blocks and has been unable to meet its requirement of iron ore. This is one case. Many PSUs must be similarly struggling. It has become urgent to ban the export of raw iron ore and other minerals. We need a tough National Mineral Policy to fight the problem of illegal mining. Such a policy would be important if the menace of Naxalism is to be addressed,” V Kishore Chandra Deo, the chairperson of the committee told The Tribune.

He cited the shortages under which RINL, the third largest player in the country’s steel sector after SAIL and Tata Steel, was working due to indiscriminate export of raw minerals.

The Committee notes, “It is quite disturbing to note the present trend of exporting minerals, particularly iron ore. Globally, many countries have rich mineral reserves, they procure them from others to preserve their own mineral wealth for use at a later date. It would be much wiser for us to preserve our minerals, which may not be available when we need them. Our mineral wealth cannot certainly be frittered away for meager sums - to be paid as royalty to fatten the purse of few private individuals or companies.”

The observations are in tune with the Supreme Court of India’s May 7 judgment in the famous Ambani brothers’ gas dispute. The SC noted in its order: “The prime aspect relates to national interest relating to the interest of consumers and protection of natural resources. Gas is an essential natural resource and the government holds it as a trust for the people of the country. Supply of gas is a matter of national interest.”

New Delhi, December 10
The Telecom Regulatory Authority of India (TRAI) has recommended cancellation of 38 telecoms licences. This was stated in a written reply in Rajya Sabha by the Minister of State for Telecom Sachin Pilot here today.

The licences identified for cancellation include those held by Telenor, Sistema and Etisalat's Indian ventures.

Pilot added TRAI had also recommended cancelling 31 other telecoms licences after legal examination Telecom Minister Kapil Sibal had earlier said that the regulator had recommended cancelling some licences as the companies had not met network rollout obligations.

Meanwhile, the regulator added it will come out with recommendations on a new mechanism linking 2G spectrum prices to the winning bids received under the recent auction of 3G licences by the end of this month.

"The 2G pricing recommendations are expected to come by this month-end," Trai Chairman J S Sarma told reporters here. The Telecom Regulatory Authority of India (Trai) had floated the proposal for linking 2G spectrum prices with 3G rates in May this year. However, due to stiff opposition from existing GSM service providers, TRAI had said it would study the issue of linking 2G and 3G prices afresh before finalising the proposal.

New Delhi, December 10
To meet the shortage of rotary wing pilots in the country, the government is in the process of amending rules so that fixed-wing Commercial Pilot Licence (CPL) holders can convert licences and fly helicopters.

Civil Aviation Minister Praful Patel today told a Parliamentary Consultative Committee attached to his ministry that the rules for conversion from pilot licence for aircraft to pilot licence for helicopters was in the advance stage of amendment.

Industry experts believe the shortage of helicopter pilots in the country is likely to increase. Incidentally, a provision does exist of cross-conversion from rotary wing to fixed wing after a CPL holder logs 100 flying hours on the type. Experts say unless remuneration in helicopters become as attractive as fixed wing aircraft, a CPL holder is not likely to use the option.

“The decision (to convert from fixed wing to rotary) will obviously be dictated by market forces but yes, the option should be there,” they say.

New Delhi, December 10
Back in double-digit growth after two months, industrial output in October rose 10.8 per cent on the back of healthy performance of sectors such as automobile, electronic goods and power.

The industrial production, which crossed 15 per cent in July, dipped to 6.91 per cent in August and further to 4.4 per cent in September.

It again entered the double-digit growth figure of 10.8 per cent in October, up from 10.1 per cent in the same month a year ago.

“The present growth rate of IIP (Index of Industrial Production) shows that revival of economic growth as started a year back is continuing,” said Sripakash Jaiswal, Minister for Statistics and Programme Implementation.

The government attributed the rise in IIP to improved performance of the sectors such as ship building, power equipment and generators.

Jaiswal added high growth in production of consumer durable goods was mainly due to healthy growth in the production of passenger cars, motor cycles, scooters and mopeds, alarm time pieces and TV sales.

The IIP data reveals that manufacturing sector during October grew 11.3 per cent and electricity generation 8.8 per cent from 10.8 per cent and 4 per cent respectively in the corresponding month last year.

The growth rate of the mining sector, however, decelerated to 6.5 per cent during the month from 9.1 per cent on October 2009. The capital goods industry, according to data, recorded a growth of 22 per cent in October, up from 10.9 per cent during the same month a year ago. — PTI

Amritsar, December 10
Pakistani traders participating in the Punjab International Trade Expo (PITEX) are upset with the high duty on Pakistani goods and visa restrictions.

Mohd Ashraf, a Pak trader dealing in leather goods, said, “High duty has affected our viability. I ended up paying Rs 7,600 as duty on a packet comprising 27 pieces of leather purse for ladies”. He also rued that the government had granted visas for merely 8 days.

He added that he was charged $1,100 for putting up a stall in the 5-day expo, which was on the higher side.

Muhammad Arshad Khan, a manufacturer and exporter of ladies garments from Lahore, said he paid 160 per cent duty on clothes and shelled out $1,500 for his stall in the PITEX.

Mohd Azeem from Gujaranwala in Pakistan said that the expo should also offer them an opportunity to interact with the Indian wholesalers so that new vistas of trade may open for both the countries.

Rupinder Singh Sachdeva, Co-Chairman Punjab, PHD Chamber of Commerce and Industries, said though it is up to the government to decide about the duration of visa, they too get visa for about a week whenever they visit Pakistan. He said they had tied up with a Pak-based company for it and charged it merely $700-750 per stall and the firm had further allotted the stalls.

Amritsar, December 10
The Indian and British governments will sign a Memorandum of Understanding (MoU) under which Indian agriculture scientists would be trained in reducing crop losses during transportation and storage.

Jane Sanders, deputy head of trade and investment, British High Commission, said initially experts from Punjab and Haryana would be trained. The formal treaty is expected to be signed between Commerce Minister Anand Sharma and England’s Secretary of State for Business, Innovation and Skill, Vince Cable in January.

The leaders would meet under the Joint Economic and Trade Cooperation (JETCO), set up to develop linkages between companies. Sanders said 35 per cent of total crops in India were lost in transit and storage. She said in her country Hull University ran a specific academic course - Logistic to keep the loss under check.

She said after the agreement, the varsity’s experts could come to India to train selected individuals from Punjab and Haryana. She added these activities were part of the outreach programme, initiated by the British government to provide expertise in education and agriculture.

She shared that a British Company, Action for Employment, popularly known as A4E, has signed an agreement with the Ministry of Rural Development, under the company would impart training in agriculture to more than 9,000 illiterate youth, belonging to the Below Poverty Line families, from 6 states including Punjab.

BRIEFLY

Pharma cos pulled up
New Delhi: Leading pharmaceutical firms such as Cipla and Ranbaxy are among the firms pulled up by the drug price regulator National Pharmaceuticals Pricing Authority (NPPA) for overcharging. — PTI

Punj Lloyd bags Rs 1,461-cr orders
New Delhi: Engineering and construction firm Punj Lloyd on Friday said it has secured a Rs 1,292- crore work order from Thailand's state-run PTT Public Company for construction of a gas pipeline, besides a separate project worth Rs 169 crore from Indian Oil Corporation. — PTI

HDFC Bank hikes deposit, lending rates
New Delhi: Private sector HDFC Bank today joined the ranks of lenders like ICICI Bank and Punjab National Bank by hiking deposit and lending rates by up to 75 basis points. The move by the second largest private sector lender will give better returns on fixed deposits, but will also make loans more expensive for existing customers. — PTI

PNB raises benchmark lending rate 50 bps
New Delhi: Punjab National Bank (PNB) on Friday announced hiking its base rate or the minimum lending rate for new borrower by 50 basis points to 9 per cent, a move which will make its all loans, including housing and auto, expensive. — PTI