The Tribune, Chandigarh, India

Rs 7,029-cr relief to states on CST
Tribune News Service

New Delhi, February 10
The government today approved a Rs 7,029-crore compensation to states for the losses they suffered due to reduction in central sales tax (CST) rate in 2010-11. In another decision, the Union Cabinet approved the proposal of the Ministry of Finance to move the necessary amendments in the Coinage Bill 2009, which is pending in the Lok Sabha with such consequential and drafting changes as may be considered necessary.

A Bill to this effect will be introduced in Parliament.

Briefing reporters after the meeting, Information and Broadcasting Minister Ambika Soni said the Union Cabinet, chaired by Prime Minister Dr Manmohan Singh, has approved a proposal for providing CST loss-related compensation to states incurred in the current financial year.

“The financial implication of this proposal is estimated at approximately Rs 7,029 crore,” Soni said, adding that Rs 3,000 crore is likely to be released in 2010-11, while the balance of Rs 4,029 crore would be given in the next fiscal.

She added that an additional requirement of Rs 3,000 crore for 2010-11 has already been included in the budgetary outlay.

The Cabinet approved the “on account payment” of compensation to the states, pending finalisation of guidelines for revenue loss incurred by states in the current fiscal because of reduction in the CST rates.

CST, a tax on movement of goods from one state to another, was reduced from 4 per cent to 3 per cent in 2007-08 and further to 2 per cent in 2008-09 after the introduction of VAT, as it was considered distortionary.

The states have estimated the loss at Rs 20,000 crore this fiscal on this account and are demanding reimbursement for the same.

Over 17 lakh mobile users opt for MNP
Haryana tops with 2.29 lakh requests
Tribune News Service

New Delhi, February 10
The first 15 days of the mobile number portability (MNP) has seen some churning in the telecom sector with over 17 lakh subscribers seeking to change their service providers all over the country.

In its first review of the MNP, 15 days after it was rolled out all over the country on January 20 last, telecom regulator Telecom Regulatory Authority of India (TRAI) said 17.11 lakh subscribers have submitted their requests to different service providers for porting their mobile number as per the reported data till February 5.

While Haryana, where the MNP was rolled out on November 25, 2010, has emerged as the circle with the highest number of portability requests, TRAI has also found that a number of requests for portability by the subscribers were turned down by the operators.

TRAI said certain port-in requests were rejected by the service providers. The major reasons for rejections were incorrect Unique Porting Code submitted by the subscriber in the porting form, non-completion of 90 days from the date of activation of mobile number, existing contractual obligation and non-payment of outstanding bill.

According to figures released by TRAI, 2.29 lakh subscribers in Haryana service area have sought portability to another operator.

In rest of the country, in Zone-I (northern and western region), maximum number of requests have been received in Gujarat (1.67 lakh) followed by Rajasthan (1.44 lakh) whereas in MNP Zone-II (southern and eastern region), maximum number of requests have been received in Karnataka (1.16 lakh) followed by Tamil Nadu service area (1.14 lakh).

TRAI is constantly monitoring the implementation of the MNP in the country and based on the complaints and feedback received, it has instructed the service providers to strictly comply with the provisions of MNP Regulations.

Keeping in mind the interest of the subscribers, TRAI has suggested that while going for the portability, the mobile users must keep in mind they should not submit incorrect Unique Porting Code, besides also ensure that there should be a 90-day period in the last porting date, there should be no subsisting contractual obligations and that there should be no outstanding payment due towards them.

Pulses’ prices unlikely to ease soon
Ruchika M. Khanna/TNS

Chandigarh, February 10
The rising prices of pulses are unlikely to see a correction anytime soon. With the private pulse importers cancelling large-scale orders for importing tuhar (arhar), because of its steep price in the international market, the gap in demand and supply will continue to drive the price of pulses.

Over the past fortnight, the prices of tuhar have gone up by Rs 10 per kg - from Rs 65 to Rs 75 per kg now. Though the government sources maintain that they are expecting a bumper crop this year, and have already denied any damage to tuhar crop because of late frost, the news of the crop damage has led to speculation by traders, resulting in a sharp price hike.

Pulse traders say that at present, the prices of tuhar in the international market are ruling at a very high rate. While the charges on cost and freight basis of Burmese tuhar in the country is around $890 per metric tonne, the same for African tuhar is around $850 per metric tonne. In comparison, the price of this pulse in the domestic market is $750 to $790 per metric tonne.

Talking to TNS, Pravin Dongre, president of the Pulse Importers Association, said since prices in India were cheaper by $100 per metric tonne, it was economically unviable for them to import.“Moreover, the public sector undertakings like MMTC, STC and PEC have already imported sufficient quantities of this pulse. Once they release these pulses in the open market, they will be able to contain the prices,” he said. It is reliably learnt that the high prices in the international market has also forced these PSUs to go slow on importing pulses.

It may be mentioned that the supply deficit from the domestic production of pulses for the current crop year is pegged at 1.5-2 million tonnes, even as production has hit a trajectory. The pulse production this year is expected to be around 16.5 million tonnes, as compared to 14.5 million tonnes.

Facebook, Google in talks to buy Twitter

New York, February 10
Facebook and Google have discussed acquisition possibility with micro-blogging service provider Twitter, according to a media report. "Executives at both Facebook and Google, among other companies, have held low-level talks with those at Twitter Inc in recent months to explore the prospect of an acquisition of the messaging service," The Wall Street Journal reported, citing a person familiar with the matter.

The report further said the talks have so far gone nowhere, but the prices being discussed value the US-based micro-blogging service provider between $8 billion and $10 billion.

Twitter, which was created in 2006, started selling ads last spring against its business of allowing users to send messages of no more than 140 characters. It is just one of many tech targets being batted about as valuations climb. In December, when it got $200 million in new venture capital, Twitter was valued at $3.7 billion.

Twitter's revenues and valuation have risen even as the company continues to work on ways to translate its more than 200 million registered users into a profitable business. The company had a revenue of $45 million in 2010 and estimates its revenue to be between $100 million and $110 million this year. — PTI

Microsoft India chief quits

New Delhi, February 10
Software major Microsoft today said Ravi Venkatesan, chairman and corporate vice- president of its India operations, has resigned. Venkatesan has decided to pursue opportunities outside Microsoft, Microsoft said in a statement.

A successor will be named in the near future and Venkatesan will partner with Microsoft International president Jean-Philippe Courtois to ensure a smooth transition with his successor, it added.

"Ravi came to Microsoft India at a very critical time. He has since architected our growth, making this among the fastest growing markets for us. He has laid a strong foundation which, I believe, will help us to continue our business successes," Courtois said.

Sanket Akerkar will continue to lead overall sales, marketing and services businesses as the sales and marketing head for India, while Hemant Sachdev will continue to lead the consumer and online business. — PTI

Airtel falls 6 pc on TRAI proposals

Mumbai, February 10
Shares of telecom giant Bharti Airtel fell by nearly 6 per cent in early trade on the BSE today, following a heavy sell-off by investors amid confusion over telecom regulator TRAI's new recommendations on 2G spectrum pricing.

The TRAI has recommended a six-fold hike in the price of start-up 2G spectrum and has said that every Mhz of additional spectrum (on an all-India basis) beyond the contracted limit of 6.2 Mhz will cost a massive Rs 4,571.87 crore.

Bharti Airtel holds extra spectrum beyond 6.2 Mhz and the new norms would impose a huge financial burden on the company.

Furthermore, the company will have to pay a hefty amount to renew its licence as per the new norms recommended by TRAI.

Reacting sharply to the development, shares of Bharti Airtel slipped by 5.82 per cent to an intra-day low of Rs 313 on the Bombay Stock Exchange.

In a similar fashion, the scrip declined by 5.7 per cent to Rs 313.20 in early trade on the National Stock Exchange. — PTI

Corporate Results
IOC profit up 134 pc to Rs 1,634 cr

Follow-on offer put on hold

Indian Oil Corporation today said its Rs 20,000-crore public offer is on hold due to unfavourable market conditions and rising global crude oil prices.
"We found in September/October (that) global oil prices (had) started rising and inflation is also high," IOC chairman SV Narasimhan told reporters explaining the reasons for putting the follow-on public offer (FPO) on hold.
"I don't think it is feasible at this stage to think of an FPO," he said.
The FPO, previously planned for first quarter of 2011 calendar year, involved a 10 per cent stake sale by the government and an equal number of new share by IOC. IOC had even appointed six merchant bankers for the sale of 10 per cent equity shares in the FPO.
"There is no timeframe (to launch the FPO) at the moment," he said, adding the company is still awaiting government approval for the share sale.

New Delhi, February 10
State-owned Indian Oil Corp (IOC) today reported an over two-fold jump in net profit to Rs 1,634 crore for the quarter ended December 31, 2010. Net profit was up 134.7 per cent to Rs 1,634.76 crore in the October-December quarter from Rs 696.59 crore in the same period a year ago, the company said in a statement.

Cairn India net jumps 7-fold

Cairn India today reported an almost seven-fold jump in net profit for the third quarter on the back of record increase in output.

Net profit climbed to Rs 2,010.12 crore in October-December from Rs 290.96 crore a year earlier, Cairn said.

Income from operations jumped to Rs 3,096.44 crore in October-December from Rs 495.46 crore in the same period last year.

GMR posts loss

GMR Infrastructure today reported a net loss of Rs 22.30 crore for the October-December, 2010, quarter due to 59 per cent rise in capacity costs, including interest charges and depreciation during the period.

The income from operations of the company, however, rose by 27 per cent to Rs 1,359.80 crore during the quarter from Rs 1,066.72 crore in the year-ago period.

Bombay Dyeing

Bombay Dyeing & Manufacturing Company today posted a net profit of Rs 67 lakh for the third quarter ended December 31, 2010.

Net sales of the company rose to Rs 429.51 crore for the third quarter ended December 31, 2010, compared to Rs 402.75 crore in the same period last fiscal.

MRF net dips

Auto tyre and rubber products manufacturer MRF Ltd today reported a 14.42 per cent decline in net profit to Rs 102.18 crore for the quarter ended December 31, 2010.

The decline in the company's bottomline came despite a sharp rise in MRF's net sales to Rs 2,165.80 crore in the December quarter from Rs 1,653.84 crore in the same period last year, it added.

ABG Shipyard

ABG Shipyard today reported a decline of 35.04 per cent in its net profit for the quarter ended December 31, 2010, at Rs 53.45 crore.

During the quarter, the company registered a growth of 9.61 per cent in its net sales at Rs 540.18 crore as compared to Rs 492.82 crore in the October-December quarter last fiscal. — PTI

Aero India-2011
MoD signs deals worth $24.66 bn with global cos
Tribune News Service

Bangalore, February 10
A report by industry body CII and rating agency KPMG, released today, indicates that the Ministry of Defence (MoD) has signed deals worth $24.66 billion with global companies. It predicts that New Delhi is in the process of signing another $41.99 billion worth of deals and goes on to talk how it will benefit the Indian industry.

Minister of State for Defence MM Pallam Raju released the CII-KPMG report titled “Unlocking the potential of the Indian Aerospace and Defence Industry” at the Aero India-2011 here.

The report is an assessment of the global opportunity ‘trigger points’ and critical success factors for making India a participant in the global aerospace and defence sphere.

It suggests critical success factors based on analysis of the best global practices in the aerospace and defence industry. India’s aerospace sector has emerged as the fastest-growing one in the world. The report predicts the nascent industry (in India) has a foothold to catapult into becoming a leading aerospace and defence hub.

The report says that indigenisation of the industry and acquiring of advanced technologies will facilitate lowering of dependence on imports. Issues of supply chain integration, technological inferiority and funding are some of the needs to be addressed.

Richard Rekhy, KPMG head in India, says the Defence Procurement Policy (DPP) 2011 is a widely accepted, well- planned document, reflecting the government’s commitment to forging international partnerships through expansion of offset policy.

Tax evasion of Rs 3.18 cr detected
Ambika Sharma

Solan, February 10
A team of flying squad led by Excise and Taxation Officer GD Thakur detected tax evasion of Rs 3.18 crore by a C&F agent of Himachal on account of paying lower VAT in the past about three years for Lays chips - a Pepsico product.

Thakur said the tax evasion came to light during a field survey where a scrutiny of papers revealed the fact that the C&F agent for Himachal was paying VAT at the rate of 4 per cent since April 2008 though earlier it had been paying VAT at the rate of 12.5 per cent.

Inquiries also revealed that the other chips manufacturing companies like ITC and Haldiram had been paying VAT at the rate of 12.5 per cent on their similar products.

Thakur said apart from this tax evasion, penalty and interest were also being calculated. The Parwanoo-based C&F agent continued to pay VAT at the rate of 4 per cent though it had been revised to 13.75 in the current financial year.

Penalty had also been revised to 100 per cent from September 2009 and it would be calculated at the rate of 15 to 200 per cent from April 2008 to August 2009 and 100 per cent from September 2009.

Food inflation declines to 13.07 pc

New Delhi, February 10
Food inflation declined to a seven-week low of 13.07 per cent in end-January, as prices of potatoes and pulses eased, even as consumers continue to feel the pinch of high rates of vegetables.

Food inflation, which snapped the three-week rising trend, fell by nearly 4 percentage points from 17.05 per cent in the week ended January 22. It was 22.08 per cent a year-ago.

The last time food inflation has come down to such a level was for the week ended December 11 when it stood at 12.13 per cent. Experts said there would be further slide in inflation rates due to the expected record crop of wheat and pulses. Government estimates suggest overall foodgrain production for 2010-11 at 232.07 million tonnes, against 218.2 million tonnes last year. — PTI

Indian likely to co-head Deutsche Bank

Berlin, February 10
Speculation is growing that India-born Anshu Jain may take over as the co-head of Deutsche Bank, Germany's largest private bank, together with Bundesbank president Axel Weber, when the incumbent Josef Ackermann retires in early 2013.

Media reports said Weber's resignation from the leadership of the German central bank is imminent and he has already informed his management board colleagues about his intention not to seek a second term when his current term expires in April next year.

He has also conveyed to the German government that he will not be available for any other public office as he has decided for another career, the reports said. — PTI

25 paisa coin history from July 1
Tribune News Service

Jammu, February 10
With the Central Government deciding to end use of 25 paisa coins from June 30 this year, the RBI today started the process of pushing the little coins to history. Those residents who don’t want to keep the coins can exchange those with equal money from the banks in the state.

The RBI today instructed the banks, maintaining small coin depots, to arrange for exchange of coins of denomination of 25 paisa and below for their face value at their branches.

According the RBI, the exchange facility will also be available at all Issue Offices of the RBI. The coins will be exchanged at the branches of banks/offices of the RBI till the close of business on June 30, 2011.