New Delhi, February 17
The Centre today decided to lift the ban on export of onion after its prices almost crashed in the domestic market, triggering widespread protests from farmers. The Empowered Group of Ministers (EGoM) on Food headed by Finance Minister Pranab Mukherjee, however, decided to allow shipments of onions at a Minimum Export Price (MEP) of $600 (about Rs 28,000) per tonne as a precautionary measure against the possibility of prices shooting up again.

Farmers cultivating onions have been demanding withdrawal of the ban on export contending that there was ample fresh stock in the market and that they must be allowed to reap the fruits of their labour. Recently, onion was being sold in wholesale markets in Maharashtra’s Nashik for as little as Rs 4 per kg.

Lifting the blanket ban will provide a mid-way for farmers, officials explain, adding that allowing exports with a floor price will ensure that low-priced onion consumed by the common man is retained in the country.

The government had in December 2010 banned onion export to improve domestic supply across the country after retail prices of the bulb touched Rs Rs 80-90 per kg overnight following failure of the kharif crop in key producing areas in Maharashtra. To cut down on exports, the government had last December more than doubled the MEP to $1,200 per tonne from $525 for exporters, who already had no-objection certificates.

Prices in retail markets across the country had more than doubled in just a couple of days over reports of damage to the standing crop in Maharashtra, the country’s largest onion-producing state. Since then, prices have dropped significantly. 

Chandigarh, February 17
Punjab Mandi Board is at loggerheads with poultry feed manufacturers in the state over the latter’s refusal to pay market fees and rural development fund (RDF) to the Board. Realising that it is losing crores of rupees as revenue, the Mandi Board has now started slapping assessment and demand notices on the defaulting companies.

Sources in the Punjab Mandi Board informed The Tribune that they have issued notices to poultry feed manufacturers located in Khanna, Rajpura and Sirhind, which also includes the big manufacturers like Suguna Poultry, Godrej Agrovet and Food Processing Company and Himalayan Frozen Foods. While the smaller units reportedly owe a few thousands of rupees as market fee and RDF, the above mentioned companies reportedly owe lakhs of rupees as fee.

It is learnt that Himalayan Frozen Foods has been issued a demand notice of Rs 21.12 lakh by the Board for failing to pay market fee (one per cent) and RDF (two per cent), including penalty, on purchase of maize worth Rs 2.58 crore. Similarly, Suguna Poultry has been issued a demand notice to pay Rs 4.50 lakh, on purchase of maize worth Rs 1.52 crore. It may be mentioned that market fee (one per cent) and RDF (two per cent) was imposed on the maize by the state government in October 2010. While some of the units, including Suguna Poultry, were initially paying market fee and RDF, they too stopped paying the same “as a protest”.

Ashok Kumar Panday, general manager, Suguna (Punjab) informed TNS that they were the only feed manufacturer in the state who were paying the market fee till December, while the Mandi Board made no efforts to recover the same from other feed manufacturers. “We are a proxy maize processing unit, and thus not liable to pay the tax,” he said. In fact, most of the feed manufacturers, who have been issued notices over the past week, have claimed that since they are processing maize into poultry feed, they are not liable to pay this tax.

However, officials in the Mandi Board informed TNS that only those units that are processing maize and wheat for converting it into secondary and tertiary products like bread, biscuits, pasta, noodles, starch and its derivatives gluten etc, are exempt from paying market fee. They claim that these poultry feed manufacturers are manufacturing feed - which is not mentioned in the list of items that are exempt from paying taxes.

New Delhi, February 17
Food inflation fell to a two-month low of 11.05 per cent for the week ended February 5 as onion prices moderated and pulses became cheaper, prompting Finance Minister Pranab Mukherjee to assert that the rate of price rise will fall to a single digit in some time.

Food inflation fell by 2.02 percentage points for the week ended February 5 from 13.07 per cent in the previous week.

"... In quite some time, food inflation will also be under single digit," Mukherjee said, adding that headline inflation will moderate to 7 per cent by March-end from 8.23 per cent in January.

Driven by high vegetable prices, food inflation has been in double digits for the past two months and had even crossed 18 per cent in the last week of December.

On an annual basis, prices of potatoes declined by 13.63 per cent, pulses by 5.88 per cent and wheat by 2.54 per cent in the week ended February 5.

However, on the whole, vegetables became nearly 24 per cent costlier during the week ended February 5. This was primarily on account of onions, which were 31.33 per cent higher during the week on an annual basis.

The spike in food prices, especially during December and January, has become a cause of concern for the government and it has taken several measures to tame it.

A Group of Ministers (GoM) on Food, headed by Mukherjee, met today to take stock of the situation.

Meanwhile, the decline in food inflation for the past two weeks prompted Planning Commission Deputy Chairman Montek Singh Ahluwalia to say the trend would continue.

Other economists, however, said while there would be further moderation in vegetable prices, overall food inflation will remain in double digits in this month. — PTI

Hyderabad, February 17
Mahindra Satyam, formerly known as Satyam Computer Services, today said it has agreed to pay $125 million to settle a clutch of class action suits filed against the company in a United States District Court.

According to Mahindra Satyam chairman Vineet Nayyer, the amount will be delivered to the plaintiffs once the US Court judge gives final approval to the settlement deal, which may take around four months.

"The $125 million will come from cash reserves which are at Rs 2,900 crore at the last count. So we don't see any problem in getting money. The amount will be put in an escrow account in a few days' time," Nayyer said.

"We will have to get the Reserve Bank approval. Once the approval comes, then this money will be transferred to plaintiffs and distributed," he added. Furthermore, the company will also pay the lead plaintiffs 25 per cent of any net recovery that it may obtain in future from PricewaterhouseCoopers-related entities that helped Satyam Computer founder Ramalinga Raju perpetrate the fraud. — PTI

New Delhi, February 17
Finance Minister Pranab Mukherjee should raise tax exemption limit on interest from bank fixed deposits to encourage people to park their funds with the lenders, say experts.

The move to relax tax norms on FDs would help the banking sector tide over the current liquidity shortage following the Reserve Bank's decision to tighten monetary policy to tame the rising inflation.

"If there are some tax concessions on interest received from bank deposits, then it would go a long way in helping banks garner deposits," Ernst & Young Partner (National Leader-Global Financial Services) Ashvin Parekh said. Presently, banks deduct 10 per cent TDS (tax deducted at source) on interest over Rs 10,000 per annum on fixed deposits.

Experts want the finance minister to at least consider raising this tax exemption limit of Rs 10,000 in view of high inflation and the need to encourage people to opt for fixed deposit schemes.

According to them, such as decision would make FDs more attractive for investors vis-a-vis other saving and investment schemes.

Most of the banks have recently raised FD rates to collect more funds and tide over the liquidity problem.

Presently, banks are offering interest rates of 9-9.5 per cent on deposits of long-term maturity. The rates may rise further as the inflation continues to be above 8 per cent, much above the comfort level of the Reserve Bank.

Commenting on his expectations, PricewaterhouseCoopers Associate Director (Financial Services) Robin Roy said the budget would give "directions on credit enhancement for infra funding, next steps for new banking licences, reducing costs of mortgage financing among others." — PTI

Jalandhar, February 17
The State Bank of Patiala (SBoP) has prepared a plan to expand its operations in the rural areas of Punjab, Haryana and Himachal Pradesh. “We have planned to open 100 branches and out of these 60 will be opened in the rural areas, mostly in this region, in the next few months”, said Ashok Nayar, Managing Director of the bank. Nayar was here to address a meeting of NRIs, who were keen to invest in the state.

Asked about the merger of State Bank of Patiala with the State Bank of India, Nayar said the issue was on hold. “As far as I know, there is no proposal as of now to merge the bank with the State Bank of India”, he said. Earlier, there was a proposal to merge all seven associate banks of the SBI, including the State Bank of Patiala, with itself. Already, two had been merged. However, merger of other associate banks has been put on hold keeping in view the strong regional identity of such banks.

Nayar said his bank had reversed the skewed credit-deposit ratio. “We have better advanced money to many infrastructure projects in the region to reverse the skewed credit-deposit ratio in the region”, he said. Asked about the contribution of the NRIs to the bank, he said 10 per cent of the total deposits in the bank belonged to the NRIs. He said the purpose of the meet was to motivate the NRIs to invest in this region. “Our bank has offered to extend all help to the NRIs in this concern,” he said. More than 100 NRIs settled in various countries attended the meeting. 

Hyderabad, February 17
The Hyderabad international airport has bagged the first rank in its category globally in the latest ASQ (Airport Service Quality) rankings of the Airports Council International (ACI).

As many as 153 airports across the world, including six Indian airports, participated in the ASQ survey in 2010. It is the second successive year that Rajiv Gandhi International Airport (RGIA), Hyderabad, has been declared as the best in its category of airports,

said a release by GMR Group, which operates the airport.

New Delhi’s Indira Gandhi International Airport (IGIA), also operated by GMR Group-led consortia, has been ranked fourth best airport in its category. The IGIA ranking is in the group of 25-40 mppa (Million Passengers Per Annum). This niche league features the world’s Best Airports like Incheon-Seoul, Changi-Singapore, and Shanghai Pudong-China, the release said.

The awards will be presented on April 7 during the ACI conference at the ACI Asia Pacific Regional Conference and Exhibition to be held in New Delhi. To be eligible for the annual ASQ awards, an airport must participate in the ASQ Survey during all four quarters of the year. The survey is carried out in strict accordance with a fieldwork survey plan, developed by ACI, which guarantees a representative sample of the flights, destinations and passenger groups served by the airport.

This achievement by both the airports speaks volumes of how a true

Public-Private Partnership can become successful with all the stakeholders and the airport community working in tandem, the release said quoting the Group Chairman GM Rao.

The Hyderabad airport was mandated by the Ministry of Civil Aviation to achieve an ASQ rating of 3.50 only by the year 2011-12. But, the airport achieved an ASQ rating of 4.44 two years ahead of the deadline and was ranked first in the 5-15 mppa category in 2009, its very first complete year of operation. In 2010, it has improved on its ASQ rating which now stands at 4.51/5.00 and has retained the top slot in its category consecutively for the second year, said PS Nair, CEO, Corporate, Airport sector-GMR Group.

New Delhi, February 17
State-owned Indian Oil Corp (IOC) is losing a record Rs 237 crore per day on selling auto and cooking fuel below cost as government continues to bar it from raising rates in line with spurt in raw material cost.

"The spike in global prices has widened the gap between the retail selling price and their cost," an IOC official said.

IOC, and its sister public sector retailers Hindustan Petroleum and Bharat Petroleum, are losing a whopping Rs 10.74 per litre on diesel, the highest ever.

Besides diesel, the three firms are losing Rs 21.60 on every litre of kerosene and Rs 356.07 per 14.2 kg on LPG cylinder. — PTI