New Delhi, June 15
Clearing the last hurdle, the Home Ministry has given unconditional approval for UK's BP to buy a 30 per cent stake in Reliance Industries' oil and gas blocks, including the showcase KG-D6 gas fields, for $7.2 billion.

The Ministry of Home Affairs wrote a one-page letter to the Petroleum Ministry on June 1 giving security clearance and a no-objection certificate for BP buying a 30 per cent stake in 23 oil and gas blocks of Reliance in India's largest foreign direct investment, a top Oil Ministry official said here.

While the NOC to the Reliance-BP deal is unconditional, the Home Ministry asked if Reliance could not have offered the stake to state-owned gas utility GAIL India or any other PSU.

"Our PSUs do not have the expertise Reliance has been looking for. It wanted an expert in deep sea technology and GAIL, which is a gas marketing and transportation company, hardly fits the description," he said.

Reliance wants to leverage the worldwide experience of Europe's second biggest energy company to resolve sub-surface technical issues at its KG-D6 gas fields, where production has fallen from 61.5 million standard cubic metres per day to about 48 mmscmd, instead of rising to the planned 69 mmscmd.

The Mukesh Ambani-led firm hopes BP would be able to fix reservoir issues at the Dhirubhai-1 and 3 gas fields in the KG-D6 block to rapidly raise output to the planned peak of 80 mmscmd and also help in formulating viable plans to bring to production other finds in the block and in other areas.

Industry observers scoffed at the idea of Reliance first offering the stake to firms like GAIL and asked whether the Home Ministry would suggest the same to Cairn Energy, which is selling its Indian unit to London-listed mining group Vedanta Resources.

ONGC is already a 30 per cent partner in Cairn India's mainstay Rajasthan block and could easily takeover Cairn Energy shares.

Production Sharing Contract (PSC) bars export of oil and the Supreme Court has upheld the government's absolute powers to decide users of natural gas. So while India is energy deficit, no government can even think of exporting gas." "There is no way that BP can take oil and gas produced from Reliance blocks to the UK," he added. — PTI 

Manesar (Gurgaon), June 15
Industrial workers owing allegiance to various unions of the Gurgaon-Manesar-Dharuhera-Bawal belt have decided to intensify their agitation in support of the ongoing strike by workers of the Maruti Suzuki India (MSI) plant at Manesar.

At a meeting held here this evening, the workers decided to hold a mass fast in all represented units of the entire belt on June 17. It was decided that the workers would perform their duties on that day, but without having food.

Haryana CITU president Satbir Singh said it was also decided to observe a tool-down strike from 11 a.m. to 1 p.m. on June 20 to stop production at all industrial units of the belt.

“If required thereafter, a mass rally of industrial workers of the region will be organised at Manesar,” he maintained.

The meeting was attended by representatives of the AITUC, Hind Mazdoor Sangh and employees' leaders from Honda, Hero Honda, RICO and other major industrial units.

Meanwhile, the strike by the workers of the MSI Manesar plant entered its 12th day today as parleys between workers, management and government officials continued to remain inconclusive.

It may be pertinent to mention here that the MSI Manesar plant workers have been on strike to press for their demand of a separate and full-fledged employees’ union at the plant.

Talks held to persuade workers to withdraw their stir have failed so far, despite active participation of the Haryana Labour and Employment Minister, Labour Commissioner and other senior government functionaries. 

Mumbai, June 15
The RBI is expected to further announce an increase in interest rates at its mid-quarter review of the monetary policy tomorrow, according to analysts. Industry is gearing up for another rate hike after data released earlier this week indicated that inflation stood at more than 9 per cent.

In a letter to the Governor of the Reserve Bank, industry body FICCI urged that the apex bank put off further increase in interest rates so as not to hurt economic growth.

"We have seen the central bank taking swift measures, with key policy rates being hiked nine times since March 2010, to rein in inflationary pressures. However, food inflation has proved to be stubbornly insensitive to any such moves," the letter written by Udayan Bose who heads FICCI's corporate finance committee said.

The industry body said rising inflation was the result of a demand-supply mismatch and aggressive monetary tightening was hurting economic growth.

The central bank had hiked the repo rate by 50 basis points on May 3.

It was the ninth time in 15 months that the RBI hiked interest rates.

The stock markets closed in the red today with investors expecting at least a 25 basis point hike in the repo rate on Thursday.

Mumbai, June 15
Notwithstanding a massive fall in factory output growth rate in April, advance tax pay-up by India Inc for the first quarter of the fiscal has increased, led by SBI with Rs 1,100 crore against Rs 850 crore in the year-ago period, easing concerns of economic slowdown.

Income Tax Department sources said today oil and gas major RIL has paid Rs 900 crore in the April-June, 2011 period, up nearly 50 per cent from Rs 650 crore in the same quarter previous fiscal.

Companies from across the sectors paid up more in advance tax this quarter than the year-ago period, except cement companies which had a poor showing.

The third in the list is the insurance giant LIC, which made an advance tax payment of Rs 580 crore in the quarter, against Rs 530 crore last fiscal.

Largest software exporter TCS saw its tax bill nearly doubling to Rs 240 crore in the reporting period from Rs 128 crore in the year-ago quarter.

The fourth in the list is the state-run Deposit Insurance & Credit Guarantee Corporation which saw an outgo of Rs 475 crore against Rs 400 crore last time.

Banks, too, barring a few state-run ones, have paid up more. Leading foreign lender Citibank saw its advance tax outgo jumping 50 per cent to Rs 150 crore from Rs 100 crore, state-run IDBI Bank saw the tax bill soaring over 125 per cent to Rs 180 crore as against Rs 81 crore in the first quarter last year. The second largest foreign bank HSBC, too, paid up more, with a tax outgo of Rs 250 crore against Rs 225 crore an year ago.

State-run lenders like Bank of India paid Rs 165 crore against Rs 158 crore, Bank of Baroda doled out Rs 250 crore as against Rs 225 crore, Dena Bank around Rs 55 crore against Rs 45 crore, while Central Bank of India saw its advance tax payout declining to Rs 145 crore against Rs 150 crore. — PTI  

Top 3
SBI — Rs 1,100 cr
RIL — Rs 900 cr
LIC — Rs 580 cr

New Delhi, June 15
After having recorded a strong double-digit volume growth over the last two years, the auto and auto components industry may face strong headwinds in 2011-12 leading to moderation in growth contributed by firming up of commodity prices, rising fuel costs and interest rates.

A report by ICRA on auto components industry says while the industry has made big strides over the last decade towards improving internal efficiency and thereby partially offsetting input cost pressures, efficiency gains alone may be insufficient going forward for players to use as a lever to combat cost headwinds.

Industry players will, therefore, need to intensify their focus on deploying more cost-effective vehicle systems in their new product development and existing model refurbishment programmes.

Subrata Ray, Sr Group VP, Corporate Ratings, ICRA, says, “Usage of common parts, vehicle light weighting, engine efficiency improvement and other frugal engineering themes are likely to occupy centre stage in the Indian automotive market in the times to come.”

Margin pressures due to rise in commodity, manpower and power costs, besides intense competition, are not new to the Indian automotive industry. However, the measures required to be taken by the industry to placate these challenges on an ongoing basis may need to be directed in areas related to design optimisation and frugal engineering, where results become visible only over a relatively longer time horizon.

This may require the industry players to incur greater investments, the report says.

However, the longer term benefits and resultant structural changes could alter the automotive design paradigm, change the cost drivers and provide greater value to customers. ICRA expects focus on these areas to be critical for the industry participants to sustain their volume growth and achieve stability of profit margins.

Mumbai, June 15
In a bid to clutch back its steeply falling market share, the cash-strapped Air India today launched a short-term promotional scheme for the domestic sector that offers passengers unlimited travel in the economy and executive classes for a 10-day period.

The promotional scheme, the platinum and silver passes, will be valid for 10 days, the airline said.

"Our effort is to provide our passengers with the most competitive prices while ensuring the best customer service," said an AI spokesperson.

While a silver pass passenger can fly on the economy class to any domestic sector of one's choice for Rs 30,000, the platinum pass holder can travel in the executive class to any domestic route for Rs 50,000, inclusive of all taxes.

These passes are available for sale at the offices of Air India and approved agents from June 15 to July 15 and will will be valid for travel up to September 25.

The day of commencement of the journey will be treated as the first day and 10 days will be counted from the date of the commencement of the journey for determining travel validity, the airline said.

Following the recent strike by its pilots, the market share of the airline has plummeted, and since the resumption of operations, it has been trying to yank back its lost seats.

Also, with a three-month moratorium on oil payment granted by the government late last week, the airline will be able to operate full capacity. Due to severe cash crunch, AI was operating only 80-85 per cent of its flights.

From last December onwards, AI was put on a cash-n-carry mode by oil companies to which the national carrier owes Rs 2,400 crore in oil payment dues.

Air India operates to 63 domestic destinations and has a network of 33 international destinations. — PTI 

Panipat, June 15
In order to improve power generation efficiency, the authorities have decided to get coal from Bharat Coking Coal Limited (BCCL) in place of Northern Coal Fields Limited (NCFL) for its Panipat thermal power plant.

The arrangement has already been approved by sub group for short-term coal linkages working under the Coal Ministry.

Haryana Power Generation Corporation Limited (HPGCL) has been under fire from various quarters, including engineers, for failure of the Panipat Thermal Plant to generate power to its full capacity. Those manning the operations at the thermal plant had been lamenting that inferior quality of coal was being supplied to the plant which prevented the units from running to full load capacity. The coal for Panipat thermal plant was being procured from the NCFL’s Krishanshilla and Dudhichua collieries.

The state has an installed capacity to generate 3,480.50 MW of power, out of which the Panipat thermal has eight units, including three units of 110 MW capacity, two units of 210 MW, two of 250 MW and one unit of 117.8 MW capacity. But, the plant had failed to meet the generation targets year after year for the last six years.

Statistics show that other than the year 2006-07 when the plant outperformed a set target of 2,310 MW by generating 2,566.62 MW, it could never achieve the generation targets.

Meanwhile, the HPGCL has also decided to import coal from Indonesian coal field and blend it with Indian coal to improve efficiency. It has set a target to import 1.45 million tonnes of coal for the current year out of which 0.27 million tonnes had already been brought in.

New Delhi, June 15
Mobile Number Portability (MNP) has turned out to be a success since its national launch in January last with over 8.5 million mobile users opting to change their service provider over the three months since the availability of the service.

According to figures released by Telecom Regulatory Authority of India (TRAI) as of April-end, more than 8.54 million requests for MNP had come in from across the country.

Of these, the mobile phone users in Gujarat, Rajasthan and Karnataka seem to be most unhappy with their present service providers as more than 2.2 million requests for MNP originated from these states, TRAI said.

According to TRAI, the maximum number of requests, 8,33,672, were received from Gujarat followed by Rajasthan with 710,767 requests, whereas in southern and eastern India the maximum number of requests were received from Karnataka, 663,151 followed by Tamil Nadu Service with 641,437 requests.

According to TRAI, it had noted that certain requests were rejected by telcos for non-payment of outstanding bills and non-completion of 90 days from the date of activation of mobile number. 

BRIEFLY

ATF prices hiked by 2.4%
New Delhi: After two successive cuts, state-owned oil firms on Wednesday hiked jet fuel or ATF prices by 2.4 per cent in step with the firming international rates. Oil companies hiked ATF prices by Rs 1,377 per kilolitre, or 2.4 per cent, to Rs 57,843 per kl in Delhi with effect from midnight tonight, an official of Indian Oil Corp said. — PTI

SAIL to raise $400 m from overseas
New Delhi: After failing to launch the IPO so far, state-run SAIL now plans to borrow $400 million from overseas lenders to part-finance its expansion and modernisation plans. "The company has sought expression of interests from overseas lenders to raise $400 million through external commercial borrowings (ECBs)," a source in the know said. — PTI

SRS to launch Rs 225-cr IPO next month
New Delhi: Faridabad-based SRS Ltd, which has interests in cinema exhibition, retail and food courts, on Wednesday said it will launch an initial public offer to raise up to Rs 225 crore by next month. The company will issue around 3.5 crore equity shares under the IPO, through which the promoters will dilute a 25.13 per cent stake. — PTI

Luxor signs Big B as brand ambassador
New Delhi: Luxor Writing Instruments on Wednesday said it has signed Bollywood star Amitabh Bachchan as the brand ambassador of 'Parker' pens in India again after a gap of two years. Bachchan was the brand ambassador of Parker from 2001 till 2008. The new endorsement contract will be for two years.— PTI