New Delhi, December 7
Amid telecom operators seeking lower levies and early resolution of a dispute over 3G roaming, Prime Minister Manmohan Singh today said the government will look into their concerns and formulate forward-looking policies to sustain growth in the sector.

“I am aware of some concerns of the telecom industry regarding government policy in the telecom sector. I wish to reassure the industry of the government’s full commitment to sustainable growth, creativity and enterprise in this vitally important sector of our economy,” he said, inaugurating the India Telecom Summit here organised jointly by the Telecom Ministry and FICCI here.

Prime Minister’s statement came in the wake of a recent meeting of the CEOs of top telecom firms, including Bharti Airtel, Vodafone and Reliance Communications, seeking his intervention to sort out differences between them and the Telecom Ministry over issues ranging from one-time spectrum charges to 3G roaming pact and a uniform licence fee.

Those from the industry at the meeting were Bharti Airtel chairman Sunil Bharti Mittal, Reliance Group chairman Anil Ambani, Aditya Vikram Birla Group chairman Kumar Mangalam Birla, Vodafone Group chief executive Vittoria Collao and Tata Sons director Ishaat Hussain.

The telecom operators have been particularly peeved with the Department of Telecom (DoT) over the latter’s view towards the 3G roaming pact between the telecom operators. The DoT is of the view that the roaming pacts which give the subscribers of these particular telecom operators a seamless roaming on third generation 3G are in contravention of the licence and hence has been seeking to impose a penalty on them.

“I would like to take this opportunity to assure all of you that our government will continue to formulate forward-looking policies that will encourage further growth of the telecom sector,” Manmohan Singh said.

According to the Prime Minister, India was today the fastest growing telecom market in the world, adding 18 million new connections to the network every month. In the process, wireless tele-density had grown from 2 per cent in 2000 to 72.1 per cent now.

Noting that the two National Telecom Policies of 1994 and 1999 were major initiatives to propel growth in the sector, the Prime Minister said the government was working on the NTP-2011 with a special emphasis on affordable and quality telecom services in rural and remote areas of the country.

He said the new draft telecom policy aimed at 175 million broadband connections by 2017 and 600 million by 2020 at a minimum download speed of 2 megabits per second, from 12.8 million at present. All village blocks will also have broadband access by 2014.

New York, December 7
Citigroup Chief Executive Vikram Pandit has announced 4,500 jobs cuts worldwide in the coming months as the US financial major seeks to trim costs in a bleak global economic environment.

The job cuts will begin this quarter and be completed “over the next few quarters” across a range of businesses, Pandit said at a Goldman Sachs Financial Services conference here. The layoffs equal about 2 per cent of Citi’s 267,000-strong workforce. The company will incur a $400 million charge in the fourth quarter this year on severance costs and other expenses related to the job cuts.

“Financial services face an extremely challenging operating environment with an unprecedented combination of market uncertainty, sustained economic weakness in the developed economies and the most substantial regulatory changes we have seen in our lifetimes,” Pandit said.

“These trends will likely significantly affect the competitive landscape in the coming years. While most of the job losses will be in Citi’s back-office and investment banking operations, almost every segment of Citi’s business will see a workforce reduction.

Pandit said, “Our efficiency goal is to eliminate 3-5 per cent of our expenses each year,” equivalent to about $2 billion. “In fact, we generated $1.4 billion of cost reductions in the first nine months of 2011,” he said.

Pandit said tightening credit spreads will likely result in a hedging loss of roughly $300 million.

Citigroup joins a growing list of financial and banking companies that are pruning their workforce to manage expenses in a weak global economy that some fear could be headed for another recession.

Bank of America had in September announced plans to cut its workforce by 30,000 and slash $5 billion in annual expenses. Goldman Sachs, Bank of New York Mellon and some major European banks have also announced job cuts.

Swiss lender UBS will downsize its investment bank workforce to 16,000 people by 2016, axing 2,000 jobs.

Pandit said going forward Citigroup will “de-risk” appropriately, “containing exposure to Western Europe and managing legacy US mortgage portfolio to mitigate risk.” It would build on a diverse and high quality consumer loan portfolio with a focus on faster-growing economies, he said. — PTI

New Delhi, December 7
Industry bodies have said that the FDI in retail being put on hold will hurt investor sentiment and have suggested tweaking the safeguards so that the reform measure can go through.

Harsh Mariwala, President, Ficci said “The government decision to hold back upto 51 per cent FDI in multibrand retail and 100 per cent in single brand retail is deeply disappointing. It is a highly regressive move”.

Ficci has suggested that the FDI up to 100 per cent in single brand retailing be allowed. It has also suggested that the FDI cap be reduced to 49 per cent in multi-brand retailing instead of 51 per cent. Also, it has asked the government to consider the possibility of increasing the limit of the population of cities where the FDI could be permitted from 10 lakh to 15 lakh and possibility of increased percentage of sourcing from SMEs.

The CII in a statement said the decision to hold back FDI in retail will have a strong impact on investor sentiment and also the foreign investors. The CII said it firmly hopes that this would not be a roll back and a quick consensus is reached.

Analysts were even more scathing in their criticism and said it might not get passed in this government’s tenure.

Prabhudas Lilladher said in a report that evolving a consensus amongst all stakeholders was a cumbersome process and would take its own time and would be a drag on the sector. “Going by the fate of several other policy proposals, we will be positively surprised if the proposal goes through during the term of this government”, it said.

The report added, “We don’t expect the government to revive this legislation anytime soon given the lack of numbers and impending state government elections in next 12 months. We expect the proposal to remain in cold storage and meet the same fate which several other government proposals have met (Urea policy, GST, DTC, Land Acquisition etc)”.

New Delhi, December 7
Coal India (CIL) today said it has lowered its production target for the ongoing financial year to at least 440 million tonnes (MT) from the estimate of 452 MT in its annual plan.

“We have kept (production target) of at least 440 million tonnes,” CIL chairman N C Jha told reporters on the sidelines of the International Conference of Safety in Mines Research Institutes.

The chairman cited various reasons like heavy rainfall, strike and delays in the grant of forestry and environmental clearances to coal projects for the downward revision in the production target.

The public sector firm also said it was planning to mine between 556 MT and 615 MT of coal in the terminal year of the 12th Five-Year Plan (2012-17).

“We are looking at two scenarios... One is business as usual... It would be 556 MT in the terminal year of 12th Plan. And the other scenario is 615 MT,” he said.

Earlier, CIL had asked the government to scale down its production target for the 2011-12 financial year to 448 million tonnes (MT), fearing it will not be able to make up for the slippage in output in the first half of the fiscal.

The state-run company missed its April-September target by about 20 MT, recording an output of 176 MT against the target of 196 MT, which it has blamed on inclement weather, including heavy rains in August-September that affected production in almost all its collieries.

The CIL had lowered its production target to 440.20 million tonnes from 460.50 million tonnes last fiscal as well. — PTI

New Delhi, December 7
Car maker Ford India will raise prices of its entire range of models by up to 3 per cent from next month on rising input costs and devaluation of rupee.

“For the last three months, the rupee devaluation is happening. The rising input costs are also hurting us. We have now decided to increase the prices of all our products by 2-3 per cent,” Ford India Executive Director (Marketing, Sales and Service) Nigel Wark said.

The company will hike the prices of its models from January 1, 2012, he added.

Earlier in the morning, the country’s second-largest car maker Hyundai Motor India said it will raise the prices of its vehicles by 1.5-2 per cent from the next month on account of high inflation and the weak rupee.

Another car-maker General Motors has yesterday announced to raise prices of its cars by 1-2 per cent from January next year for similar reasons.

Rupee depreciation is putting pressure on firms importing a substantial amount of components from overseas. Other car-makers, including Maruti Suzuki India, are also mulling price hike to offset rising input cost. — PTI

New Delhi, December 7
Claiming success in stalling FDI in retail, the CPM today demanded an immediate ban on forward trading in all agriculture commodities, rollback of petrol prices and release of excess foodgrains in government stocks.

“We are happy that this time the government has yielded without waiting for the washout of the entire Parliament session. This time they have relented mid-way through the session by agreeing to suspend the decision on FDI in retail,” CPM politburo member Sitaram Yechury told reporters here.

Asked whether the CPM had gone back on its demand for complete rollback of the FDI decision, he said, “As long as we, as a political party, are part of the stakeholders, there cannot be a consensus.” He pointed out that the government has announced that no decision would be taken in this matter till a consensus is reached in discussions with all stakeholders.

Yechury said the CPM will now try to impress upon the government to immediately ban all forward trading in all agriculture commodities. Besides this, he said the party will also demand a rollback in the hike in petrol prices as the oil marketing companies have been making profits. — PTI