New Delhi, January 27
India has signed a multilateral convention on mutual administrative assistance in tax matters aimed at combating tax avoidance and evasion. The convention not only facilitates the exchange of information, but also provides for assistance in the recovery of taxes. This will give a fillip to the government’s efforts in bringing the Indian money illegally stashed abroad.

This instrument was earlier available for the members of OECD and Europe was amended in 2010 and open for all countries in June 2011. The convention was amended to respond to the 2009 G20 Summit call for developing a broader multilateral approach to improve the effectiveness of exchange of information, co-operation between the countries in the assessment and collection of taxes.

By signing the convention, India and the other 31 signatories encourage more countries to join, sending a strong signal that countries are acting together to ensure that individuals and multinational enterprises pay the right amount of tax, at the right time and in the right place.

The salient features of this multilateral convention are that it provides extensive forms of cooperation among the signatories on all taxes.

It provides for simultaneous tax examinations and participation in tax examinations in other countries. This allows tax officials to entering into the territory of the other country to interview individuals and examine records.

The convention explicitly provides for automatic exchange of information and spontaneous exchange of information and allows exchange of past information in criminal tax matters.

The information received under the pact can also be used for other purposes besides those related to tax cooperation, for example to counter money laundering with the approval of the supplying state.

Present signatories to the amended convention are Argentina, Australia, Belgium, Brazil, Canada, Denmark, Finland, France, Georgia, Germany, Iceland, India, Indonesia, Ireland, Italy, Japan, Korea, Mexico, Moldova, Netherlands, Norway, Poland, Portugal, Russia, Slovenia, South Africa, Spain, Sweden, Turkey, Ukraine, the United Kingdom and the United States.

Davos, Switzerland, Jan 27
The Mahindra group's two technology ventures — Tech Mahindra and Mahindra Satyam — would be merged by the end of this year, a senior group official said here.

"Also, the Mahindra name would certainly be there in the combined entity, although there has been no decision so far on whether to retain the Satyam name”, Mahindra Satyam chairman Vineet Nayyar told PTI here on the sidelines of the World Economic Forum summit.

“The integration would certainly happen pretty soon. The process would be initiated very soon and, hopefully by the end of 2012, we may have one single company," said Nayyar, who is also the vice-chairman, MD and CEO of Tech Mahindra. Mahindra Satyam is a strategic partner for the WEF annual meeting being held here.

Asked whether the legal issues concerning the former auditors and former management of erstwhile Satyam Computer would affect the merger, Nayyar said, "I do not think so. The legal issues should not affect the process, why should they?"

On whether the group would continue with the Satyam brand name, given the negativity of the past attached to it, he said "Mahindra is more important to us than Satyam".

"The bad image associated with Satyam seems to have got over, because Mahindra has always been a very good name in terms of brand, corporate governance and everything else," he added.

Asked if Satyam name would be dropped after the integration, he said, "Nothing has been decided as yet, but one thing is certain that Mahindra name would remain there."

On whether Tech Mahindra would be merged into Mahindra Satyam or the opposite would be done, he said a decision is yet to be taken on that. Consultants would suggest the process, but the final call would be taken by the management.

Tech Mahindra acquired Satyam Computer Services in April, 2010 and later renamed the company Mahindra Satyam.

In January, 2009, erstwhile Satyam Computer founder and then Chairman B Ramalinga Raju admitted to fudging account books to the tune of thousands of crores of rupees. — PTI

Mumbai, January 27
The BSE Sensex rose for a sixth straight session on Friday to a 11-week high as foreign investors continued to buy local stocks on indication of a policy shift towards reviving growth, with an increase in global risk appetite also aiding sentiment.

Foreign funds have pumped in more than $1.5 billion into beaten-down Indian shares this month, in sharp contrast to net outflows of about $500 million in 2011.

Reliance Industries and Infosys , which together contribute about a fifth to the benchmark index, led the rise. Reliance rose 3.7%, while Infosys jumped 2.2%.

The main 30-share BSE index closed 0.92 points up at 17,233.98, its highest closing level since November 9, with 16 of its components gaining.

"I think it's because of loads and loads of liquidity and above that the Fed statement that probably they will keep interest rates low till late 2014," said Jagannadham Thunuguntla, head of research at SMC Investments and Advisors. "I think it's value taking plus liquidity support."

On Wednesday, the Fed surprised financial markets by saying it expected to leave US benchmark borrowing costs at effectively zero until at least late 2014. — Reuters

Mumbai, January 27
PricewaterhouseCoopers said on Friday India's middle class will grow in size to become a US $1 trillion opportunity to be tapped for various consumer-oriented industries.

The country's total population will be around 1.36 billion by 2021 of which middle class will account for 570 million. The demographics will result in higher aspirations which will have to be served by companies, the consulting firm's executive director, Shashank Tripathi, told reporters here.

Companies in the retail and consumer goods, telecom, financial services, industrial products, and healthcare and pharma space can benefit from this opportunity, he said.

Even though Asia's third-largest economy will urbanize faster, a majority of the demand for this $1 trillion opportunity will come from the rural areas, Tripathi said, adding that aspirational people indulging in vocations beyond agriculture will contribute to the demand.

Companies will have to pull up their socks and incorporate changes in product designs to make more disruptive offerings, he added. — PTI

Bangalore/Hong Kong, January 27
Investors in Apple Inc have a one-word answer for those who wonder whether this corporate juggernaut can maintain its phenomenal momentum in the years ahead: Asia.

The iconic maker of the iPhone, iPad and iPod has barely scratched the surface of the region, home to around 60 percent of the world's population — a fact that Apple itself alluded to in reporting an eye-popping set of earnings this week.

Apple's numbers, which included a 70 per cent jump in December-quarter revenues and a doubling in profits, actually excluded sales of its hottest new product, the iPhone 4S, from its biggest single potential market, China.

And in China's long shadow, other virtually untapped Asian markets such as India and Indonesia are waiting to be conquered, together home to around 1.4 billion people.

To style-conscious consumers everywhere to whom Apple's sleek devices are not so much useful gadgets as essential fashion accessories.

But Dylan, and hundreds of millions of other aspiring Apple customers from Jakarta to Shanghai to Bombay, have a problem: they cannot afford to buy the main objects of their desire. At about $830, even the older iPhone 4 costs twice the monthly salary of a young foreign exchange dealer in Jakarta.

That simple fact — unaffordability across emerging Asia — has begun to test faith in Apple's ability to maintain its torrid sales growth without a big foray into a new product category, like TV. Though its shares keep rising, its future earnings become cheaper: valued at about 30 times earnings a few years ago, Apple's stock now trades at half that multiple.

As Apple waits for Asian incomes to catch up, there is a risk that savvy competitors, especially main rival Samsung Electronics Co, could catch it napping with cheaper products that are becoming better, and cooler.

Pricing is also an issue in India, where the smartphones of choice belong to Samsung, maker of the Galaxy, and to Nokia and RIM's BlackBerry. "I’d much rather have bought one but I didn't have enough money to buy it. It's as simple as that," said Soubhik Mukherjee, 26, a social-media marketing strategist in New Delhi. "It's quite ridiculously priced in India ... I don't have that kind of disposable income."

Mukherjee plans to buy a smartphone next month and is considering a BlackBerry or a Samsung Galaxy. "Apple's biggest strength till now has been the user interface. It’s the sleekest phone possible, the possibilities, design, basically the App store ... But I guess now there’s an alternative. Two years ago it wasn't there, but now it's there."

THE CULT OF APPLE: Industry experts say Apple could develop a cheaper version of iPhone for the big Asian markets, without jeopardizing its prodigious profit margins, but other obstacles would remain, such as compatibility of new products with local telecoms networks and how to distribute them.

The pickup of 3G in India has been slower than expected, partly due to high service prices but mainly because most Indians still use phones just to talk or send text messages. Internet browsing and making video calls are a technological world away for those living outside India's cities. — Reuters

Chandigarh, January 27
American multinational technology and consulting corporation IBM plans to invest up to Rs 25 billion (about US $506.75 million) in India by 2013 for expansion if its sales and business development centres. The company is looking at expanding its presence in 47 cities in the next two years.

IBM is currently present in 25 cities across the country for its sales and business development business.

The company’s focus now appears to be on increasing its presence in smaller, rapidly developing Indian cities. By extending its network of branches, IBM’s focus is on strengthening its ability to deliver technologies and services to clients across the country. In North India, the company will be opening two offices —in Ludhiana and Jammu — this year.

Nipun Mehrotra, vice president & GM, sales & business development, IBM India & South Asia, told The Tribune the idea behind this expansion was to work with clients locally and do business development with them.

“IBM is seeing demand for information management, security, cloud computing and business analytics solutions as businesses and government organizations turn to IT to reduce costs and gain competitive advantage. In order to tap clients across all segments — be it the SMEs or big corporate, IT and financial services, we’ve decided to be present across various geographies,” he said.

He said the company was not only targeting the big cities, but also expanding in some tier 3 towns, where industrial activity has propelled IT demand. “Of the 25 locations we’re already present in, 19 branches are in tier 2 cities. Recently, we opened offices at Dehradun, Gauhati and Raipur. We’ve a number of clients in the banking, education, government, energy, manufacturing, industry and IT sectors. The new branch offices will help us reach out to SMEs in a big way,” he said.

However, with skilled manpower being a constraint for the company in smaller cities, IBM has now devised a mix of old company officials, existing professionals in these cities and fresh recruits for all new offices.

IBM started operations in India in 1992, and now offers solutions and services across all major industries including financial services, healthcare, government, automotive, telecommunications and education, among others.

The company does not give a headcount, but third party reports suggest its India unit has close to 100,000 employees and revenues from Indian operations are close to $3 billion.