The Tribune, Chandigarh, India

Rice, wheat stocks swell providing room for exports

New Delhi, May 10
The country’s rice and wheat stocks hit 59.1 million tonnes on May 1, nearly four times above target and possibly providing a government struggling with high food prices some room to allow exports.

Wheat stocks at 31.4 million tonnes and rice at 27.8 million tonnes are well in excess of targets of 4.0 million and 12.2 million tonnes respectively, the result of bumper harvests in recent years and export curbs.

Encouraged by overflowing grain bins, the agriculture ministry has been advocating lifting a four-year-old ban on wheat exports, although worries about food inflation could scupper this.

A decision on exports has also been delayed while the government finalises how much grain it would need for a proposed law that promises more cheap food to the poor.

“There are massive stocks, no doubt. Current stock levels will give a cushion to the government if it decides to permit exports in May,” said Veeresh Hiremath, research head of Karvy Comtrade, a brokerage based in the western city of Ahmedabad.

India is the world's second-biggest producer of wheat after China. With annual domestic demand of about 76 million tonnes, it also ranks second in consumption to China — where demand is over 100 million tonnes.

The government, which buys grains from local farmers to build reserves for emergencies and to run various welfare programmes, will get a clear idea about its new season inventory in May when it finishes purchasing wheat from growers.

Any supply from India, close on the heels of exports from Pakistan, will put pressure on benchmark Chicago prices Wc1, which are slightly lower this year.

“Competition will be there and, therefore, it makes sense for India to quickly allow exports. After September, there will be pressure on prices due to the arrival of Black Sea wheat,” Hiremath said.—Reuters

BMW unveils new concept sports car
Starts local assembly of engines in Chennai

New Delhi, May 10
Luxury car maker BMW India unveiled its concept hybrid sports car. At the vent, the company said it has started assembling engines of 3 and 5 Series sedans and sports utility vehicle X1 at its Chennai plant from April to avoid the higher 30 per cent customs duty, following the new norms on completely knocked down units in the Budget.

“At this point of time, our completely knocked down (CKD) operations are fully fulfilling the new regulations. We are paying 10 per cent duty... There will be no price hike,” BMW India President Andreas Schaaf told reporters here.

For pre-assembled engines, transmissions and gearboxes, customs duty was fixed at 30 per cent in the 2011-12 Budget as against 10 per cent earlier. However, other parts continue to attract a customs duty of 10 per cent.

"In our engines, about 50 per cent of the assembly is done in India. So it is considered as locally produced," he said, adding, the company will gradually shift to complete manufacturing of vehicles once it reaches a sizeable volume.

The company currently assembles 3 and 5 Series cars and the SUV X1. The ex-showroom prices of 3 and 5 Series cars in Delhi starts at Rs 24.4 lakh and Rs 37.6 lakh, respectively, while the X1's price begins at Rs 22.4 lakh.

While unveiling the concep car, Heavy Industries and Public Enterprises Minister Praful Patel said his ministry has asked the Finance Ministry to give two years' time to the auto industry to comply with the new CKD norms.

When asked about seeking the two-year timeline despite being able to meet the new guidelines, Schaaf said: "We are of the belief that any regulation should not be changed overnight but should be implemented planfully over a period of time. So we are a part of the SIAM's request to extend the timeline".— PTI

FICCI delegation in Australia

New Delhi, May 10
A FICCI business delegation is currently on a visit to New Zealand and Australia. The New Zealand leg of the visit concluded today with Commerce Minister Anand Sharma expressing hope that the two countries would conclude a Free Trade Agreement (FTA) next year with the target of trebling bilateral commerce to $3 billion by 2014.

The Australian leg of the tour begins tomorrow with Congress MP Naveen Jindal leading the India—Australia CEOs Forum. During the visit, the two countries will look to engage actively to explore opportunities for furthering trade ties. The Indian delegation is scheduled to meet Australian Prime Minister, New South Wales Premier and other key ministers.

They will also meet the Indian & Australian business community in Australia, eminent academicians and other representatives from. Jindal said there were still many unexplored areas where the relationship could be extended between the two countries as well as areas, where the potential was unfulfilled.

Jindal would be leading several stalwarts of the Indian industry on this visit. Some members of the entourage are Vineet Nair (MD & CEO, Tech Mahindra), N Chandrasekharan (CEO, TCS) Ashok Sawhney, MD (Ranbaxy Labs) etc. — TNS

No service tax on food to rooms from hotel restaurants: CBEC

New Delhi, May 10
Food served in hotel rooms from their air conditioned restaurants with liquor licences will not attract service tax, the revenue department today said.

“When food is served in the room, service tax cannot be charged under the restaurant service as the service is not provided in the premises of the air-conditioned restaurant with a licence to serve liquor,” a Central Board of Excise and Customs (CBEC) circular said.

While clarifying the provisions of service tax to be levied on services provided by air conditioned restaurants with licence to serve liquor, the CBEC said the Value Added Tax (VAT) was excluded from the taxable value.

Presenting the Budget for 2011-12, Finance Minister Pranab Mukherjee had announced that a 10% tax on services provided by air-conditioned restaurants that have licence to serve liquor, with an abatement of 70%.

Besides, bills for short-term accommodation provided by hotels, inns, guest houses, clubs or campsites went up by 5%.— PTI

Coal firms asked to review R&R for mining projects
Vibha Sharma
Tribune News Service

New Delhi, May 10
Worried that land acquisition for mining could head the way of ongoing farmers' unrest, Coal Minister Sriprakash Jaiswal today directed Coal India Limited (CIL) and its subsidiaries to review Rehabilitation and Resettlement (R&R) policy, while acquiring land for coal mining.

Coal firms generally acquire large chunks of land for projects.

Delays in land acquisition for mining projects had become a major impediment to increasing the country's coal production, the minister told a review meeting of government coal companies, telling them to overcome this with a more attractive and stakeholder-friendly R&R policy.

Jaiswal, who yesterday made a political statement on the unrest in UP saying that "farmers protest had been dealt with violently" and "farmers must be paid their due by the Uttar Pradesh government," said in today's meeting that the R&R policy should meet aspirations of land losers and provide welfare measures for long term, besides ensuring adequate compensation and proper employment to affected persons.

For the year 2011-12, the companies have a production target of 452 million tonne, which the government wants to be "achieved at all cost". While the Minister wants "no laxity on this account", the simmering farmer's tension in the country over land acquisition has already spilled over to the coal region, the latest being the one in Chattisgarh's Raigarh district for the acquisition of 693.32 hectares for a coal mine.

Sources said Coal India Ltd is likely to revive its proposal for financial inclusion of those losing land due to mining by offering an opportunity to be a shareholder.

India, Pak mull banking facility for cross-border trade

Srinagar, May 10
The Governments of India and Pakistan are considering a scheme formulated by the Reserve Bank of India for providing banking facility to cross Line of Control (LoC) trade in Jammu and Kashmir, a senior state minister said.

Minister for Finance Abdul Rahim Rather told a delegation of Cross LoC traders that the State Government is very keen to give a big boost to the trade between the divided parts of the state, for which all the required measures are being taken.

Rather referred to Government initiatives taken for establishing of Bank transaction facilities for the conduct of cross Line of Control trade through banking transactions.

"The Reserve Bank of India has already framed a comprehensive scheme which is under consideration of the Governments of India and Pakistan.

Once the scheme gets the nod, the Banking facilities would be put in place as per the urges and aspirations of the traders," he said.

The scheme would help boost trade and facilitate payments. — PTI

Sony to restore PlayStation Network by May end

Tokyo, May 9
Unable Sony said Tuesday it aimed to fully restore its PlayStation Network, shut down after a massive security breach affecting over 100 million online accounts, by the end of May.

Sony also confirmed that personal data from 24.6 million user accounts was stolen in the hacker attack last month.

Personal data, including credit card numbers, might have been stolen from another 77 million PlayStation accounts, said Sony Computer Entertainment Inc. spokesman Satoshi Fukuoka.

He said Sony has not received any reports of illegal uses of stolen information, and the company is continuing its probe into the hacker attack. — Reuters

Exporters fear drastic fall in trade if DEPB withdrawn

New Delhi, May 10
India’s exports will drop to $200 billion in the current fiscal if sops under the Duty Entitlement Pass Book Scheme (DEPB) duty neutralisation scheme are withdrawn, apex exporters' body FIEO cautioned today. The government has set an export target of $312 billion for 2011-12, pegging growth at 26.7 per cent vis-a-vis the 2010-11 achievement, as highlighted in the Commerce Ministry's strategy paper.

The country had registered an impressive growth of 37.5 per cent in overseas merchandise shipments in 2010-11, which reached $246 billion, against a modest target of $200 billion.

"If there is no continuation of DEPB, exports will fall to $200 billion," Federation of Indian Export Organisations (FIEO) President Ramu S Deora said here.

Under the DEPB, the incidence of customs duty on import content of export products is neutralised and reimbursed to the exporters. Several key industries like engineering, including automobiles, have been the major beneficiaries of the scheme.

On concerns that the DEPB is not compliant with World Trade Organisation (WTO) rules, the government has announced discontinuation of the same from June 30 this year.

Exporters are opposed to the move and have been pleading with the government that either the scheme should remain intact or be replaced by an alternative. The annual payout on this head to exporters is Rs 8,100 crore.— PTI

Corporate Results
Ranbaxy Q1 net down 68 pct; betters forecast

Bangalore, May 10
Ranbaxy Laboratories Ltd, India's top drug maker by sales, on Tuesday said quarterly profit fell 68.4 percent as the year-ago quarter was boosted by sales of a limited competition drug, but the drop was less than expected.

Ranbaxy, controlled by Japan's Daiichi Sankyo, said consolidated net profit fell to 3.04 billion rupees ($67 million) for the fiscal first quarter ended March compared with 9.61 billion rupees a year earlier.

A Reuters poll had forecast net profit of 1.51 billion rupees for the firm.

Indian generic drug makers including Ranbaxy and rival Dr Reddy's Laboratories Ltd are eyeing a huge opportunity as drugs worth about $100 billion lose patent protection over the next two years.

However, they will have to battle intense competition, rising lawsuits from rival drug firms and a stricter US health regulator in their race for the lucrative off-patent market.

Jubilant Life Sciences net falls

Jubilant Life Sciences, formerly known as Jubilant Organosys, has received setback during the year ended March 2011 and its consolidated net profit declined by 45.5 per cent to Rs 230 crore from Rs 421.46 crore in the previous year. The consolidated net sales also declined by 9.4 per cent to Rs 3,433 crore from Rs3,791 crore.

HDFC Q4 net up 23 per cents

Mortgage major HDFC today said it has posted a 23 per cent surge in net profit to Rs 1,142 crore in the fourth quarter ended March 31 on a standalone basis.

The housing finance lender, which has managed to maintain profitability even in the high interest rate scenario, expects its advances to grow by 20 per cent.

HDFC's net profit for the corresponding January-March period last year had stood at Rs 926 crore. For the 12-month ended March 31, 2011, its net profit
stood at Rs 3,535 crore, up 25 per cent.— Agencies