SPECIAL COVERAGE
CHANDIGARH

LUDHIANA

DELHI



THE TRIBUNE SPECIALS
50 YEARS OF INDEPENDENCE

TERCENTENARY CELEBRATIONS
B U S I N E S S

Re hits near 3-month low; more pain likely
Mumbai, April 10
The rupee slid to a near-three-month low on Tuesday weighed by dollar demand from oil importers, while choppy local shares and worries over global growth kept risk appetite subdued.

CRR may be cut for first time in 3 yrs
Mumbai, April 10
The Reserve Bank of India is likely to cut its repo rate for the first time in three years in an attempt to lift sagging economic growth, even as high oil and food prices remain a challenge to managing inflation, a Reuters poll showed.

Govt likely to decide on aviation FDI on Thursday
New Delhi, April 10
The government is likely to decide on a proposal to allow foreign carriers to invest in local airlines as early as Thursday, a senior government official said, which could provide a lifeline to cash-starved and debt-laden carriers like Kingfisher Airlines.

India challenges US work visa fee hike at WTO
New Delhi, April 10
India has launched a complaint at the World Trade Organization over the cost of US work visas, which it says are too high and discriminate against a group of Indian IT firms, in the latest sign of prickly trade ties between the two allies.



EARLIER STORIES

Olympus scam: Investors urged to reject revised accounts
A customer looks at a digital camera next to an ad for Olympus at an electronics store in Tokyo on Tuesday.
A customer looks at a digital camera next to an ad for Olympus at an electronics store in Tokyo on Tuesday. A global shareholder advisory firm has urged investors in Japan's scandal-tainted Olympus Corp to refuse to accept the firm's recently restated accounts and to vote against two men nominated to lead the business out of disgrace. — Reuters

2G case: Loop Tele to close India ops except in Mumbai
New Delhi, April 10
Loop Telecom, whose 2G licences were among the 122 telecom licences cancelled by the Supreme Court, today said it is in process to shut down its business in India. "We’ve no other option. The company has already advertised in newspapers for shifting our customers on other network through mobile number portability," a Loop Telecom spokesperson said.

Car sales up only 2.2%, crash to 3-yr low
New Delhi, April 10
Car sales in India rose just 2.2 percent in the fiscal year that ended in March, a year to forget for automakers marked by demand-smothering high interest rates and rising fuel costs, but are seen posting double-digit growth this year.

Sony Corp CFO Masaru Kato looks on as he attends a news conference in Tokyo on Tuesday. Sony Corp CFO Masaru Kato looks on as he attends a news conference in Tokyo on Tuesday. The Japanese electronics giant forecast a record $6.4 billion net loss for the business year just ended, double earlier forecasts and a fourth straight year of losses, inflated by writing off deferred tax assets in the United States. — Reuters

Tech Mah, Satyam to hire up to 10,000
Bangalore, April 10
Tech Mahindra Ltd and Satyam Computer Services Ltd, which are in the process of a merger, aim to hire up to 10,000 staff for the combined entity in 2012-13 to meet an expected rise in demand for technology services.

Gold sales tumble despite strike end as prices climb
Mumbai, April 10
Daily sales of gold are down 80% from a year ago so far this week from April 9 despite the end on Saturday of a 22-day strike when jewellers shut shop over taxes, as high prices are still hurting appetite.





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Re hits near 3-month low; more pain likely

Mumbai, April 10
The rupee slid to a near-three-month low on Tuesday weighed by dollar demand from oil importers, while choppy local shares and worries over global growth kept risk appetite subdued.

The Indian currency ended at 51.475/485 to the dollar, weaker than Monday's close of 51.14/15, after touching a low of 51.495, a level last seen on January 16.

Emerging market currencies, including the rupee, received a boost after robust Chinese trade data raised hopes for improvement in risk appetite, but then focus shifted to the slower-than-expected import growth prompting profit sales.

The China data initially pushed up the rupee to an intraday high of 51.06 to the dollar. But concerns about the broader Indian economy is likely to keep the rupee pressured, dealers said.

"More pressure on the rupee is likely due to weak domestic fundamentals like a widening current account deficit, absence of strength in equities and lack of large dollar inflows," said Subramaniam Sharma, director of brokerage Greenback Forex, who expects the currency to inch towards 51.60 during the week.

Traders were also cautious as they awaited a meeting between government officials and representatives of rating agency Standard & Poor's, amid downgrade risks caused by slowing growth, high inflation and widening trade deficit.

India's balance of payments slipped into negative territory for the first time in three years and the current account deficit widened to $19.6 billion in December quarter from $9.7 billion a year earlier.

A sustained fall in the rupee is, however, unlikely as traders expect the Reserve Bank of India to step in to shore up the currency. The RBI is suspected to have sold dollars on Monday, helping the rupee pull off the day's lows. The central bank bought $1.1 billion and sold $1.4 billion in the spot market in February, data released on Monday showed.

The one-month offshore nondeliverable forward contracts were at 51.93. — Reuters

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CRR may be cut for first time in 3 yrs

Mumbai, April 10
The Reserve Bank of India is likely to cut its repo rate for the first time in three years in an attempt to lift sagging economic growth, even as high oil and food prices remain a challenge to managing inflation, a Reuters poll showed.

Of 20 analysts polled, 17 expect the RBI to cut the repo rate by 25 basis points to 8.25% on April 17, while three see it unchanged at 8.50%.

The RBI has held its key interest rate steady since its policy review in mid-December, after raising it 13 times from March 2010 to tame high inflation, most recently in October. Its last rate cut was in April 2009.

"The driving factor for a repo cut is basically to pull down the cost of funds. The slowdown in the economy is coming from a drop in investments, and that has to be reversed," said Saugata Bhattacharya, an economist with Axis Bank.

Of 19 respondents, 13 expect no cut next week in the cash reserve ratio (CRR) requirement for banks, or the share of deposits lenders have to maintain with the RBI. Only four respondents forecast a 50 bps cut in CRR on April 17, while two see a 25 basis point cut.

In January, the RBI cut CRR by 50 bps, and further reduced it by 75 bps in March to 4.75 percent to ease tight liquidity in the banking system ahead of advance tax payments by companies.

Economists have scaled back their expectations for rate cuts in the fiscal year that started this month but have increased their expectations for cuts in CRR since a poll in March.

The median estimate for the repo rate in March 2013 now stands at 7.75%, higher than the estimate of 7.50% in a poll last month. Similarly, the median estimate for CRR is 4%, compared with 4.25% in March.

India's economy grew at just 6.1% in the December quarter, the slowest in nearly three years. High food inflation is likely to pinch Indians at least until July as fruit and vegetable output shrinks, hurt by rising temperatures and dry conditions, while edible oil and pulses prices are rallying on lower production and a more expensive world market. — Reuters

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Govt likely to decide on aviation FDI on Thursday

New Delhi, April 10
The government is likely to decide on a proposal to allow foreign carriers to invest in local airlines as early as Thursday, a senior government official said, which could provide a lifeline to cash-starved and debt-laden carriers like Kingfisher Airlines.

"The decision is imminent," said the official at department of industrial policy & promotion, referring to a proposal to allow foreign carriers to invest in local airlines. It may be as soon as Thursday”, he added. He, however, declined to say what the proposed foreign investment cap would be. — Reuters

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India challenges US work visa fee hike at WTO

New Delhi, April 10
India has launched a complaint at the World Trade Organization over the cost of US work visas, which it says are too high and discriminate against a group of Indian IT firms, in the latest sign of prickly trade ties between the two allies.

The complaint is at the level of WTO "consultations" between the two parties — the last step to resolve a disagreement before entering a full-fledged legal dispute.

"India is taking up consultations on this issue and hopes to solve it amicably," an official at the trade ministry said on Wednesday, asking not to be named because of the sensitivity of the matter.

The official did not say when the complaint was taken to the WTO, but said Trade Minister Anand Sharma raised the visa issue with U.S. Commerce Secretary John Bryson on a visit to India on March 26.

Last month, the United States began the same type of action at the WTO to open India's market for poultry meat and eggs, saying an Indian ban on U.S. imports intended to stop the spread of bird flu was not based on sound science.

A US embassy spokesman had no immediate comment.

Commercial ties between India and the United States flourished after India's economic liberalization in 1991, but in recent years each side have accused the other of erecting unfair barriers to trade and investment growth.

India's economy has benefitted greatly from information technology firms doing offshore work for U.S. companies, but such outsourcing has become an issue in the U.S. presidential campaign, with President Barack Obama vowing to woo jobs home from overseas.

India's complaint is about a US law from 2010 that almost doubled visa fees for skilled workers to $4,500 per applicant. The bill's sponsor, Senator Charles Schumer, a Democrat from New York, said at the time that the move was aimed at a small group of companies exploiting US law to import workers from abroad.

"I think the government of India is right that this is a barrier to trade," Vineet Nayyar, CEO of Indian software services exporter Tech Mahindra, told Reuters. — Reuters

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2G case: Loop Tele to close India ops except in Mumbai

New Delhi, April 10
Loop Telecom, whose 2G licences were among the 122 telecom licences cancelled by the Supreme Court, today said it is in process to shut down its business in India. "We’ve no other option. The company has already advertised in newspapers for shifting our customers on other network through mobile number portability," a Loop Telecom spokesperson said.

Loop Telecom has begun the process to issue job termination notice to all its employees following its plan to shut down business in India. "All employees have been made aware. We’ll soon issue them formal notice," the spokesperson said, adding the firm has about 150 direct employees. Loop had 2G telecom licence for 21 circles and had operations in 13 circles. — PTI

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Car sales up only 2.2%, crash to 3-yr low

New Delhi, April 10
Car sales in India rose just 2.2 percent in the fiscal year that ended in March, a year to forget for automakers marked by demand-smothering high interest rates and rising fuel costs, but are seen posting double-digit growth this year.

Sales rose an annual 19.7 percent in March, a fifth straight monthly increase, but still lower than the 30 percent growth seen in the 2010-11 fiscal year, before India's GDP growth started to temper and 13 interest rate increases began to bite.

"We believe interest rates will maintain or go down from here and fuel prices will remain stable," said S. Sandilya, president of the Society of Indian Automobile Manufacturers (SIAM).

The growth is the slowest since the fiscal year 2008/09, when sales rose only 1.4 percent as India grappled with the impact of the global financial crisis. Sales grew 25% in 2009-10 and 29% in 2010-11.

Car sales are expected to grow 10% to 12% in the current fiscal year to end-March 2013, SIAM said Tuesday.

Demand for cars fell for the first time in three years last July and slumped by the most in over a decade in October as high interest rates and rising fuel costs deterred buyers, who are typically reliant on loans for purchases.

Maruti Suzuki, the biggest carmaker, sold 10.8% less cars in the 12 months to March than a year previous, as the firm, 54.2% owned by Japan's Suzuki Motor, also suffered production losses on widespread labour strikes. — Reuters

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Tech Mah, Satyam to hire up to 10,000

Bangalore, April 10
Tech Mahindra Ltd and Satyam Computer Services Ltd, which are in the process of a merger, aim to hire up to 10,000 staff for the combined entity in 2012-13 to meet an expected rise in demand for technology services.

The companies also plan to complement their parent Mahindra & Mahindra group's move to become a major defence manufacturer, Tech Mahindra CEO Vineet Nayyar said on Tuesday.

Tech Mahindra bought Satyam in a government-backed auction in 2009 after Satyam's founder admitted to one of India's biggest accounting frauds. The merger, after regulatory approvals that are expected later this year, would create India's no. 5 software services exporter by revenue.

"We’re trying to secure more efficiencies internally, we'll see how it works out, but I think it will be anywhere between 5,000 to 10,000 range," Nayyar told Reuters, referring to hiring plans for the fiscal year that began on April 1.

The two companies, whose clients include BT Group Plc and SAAB Group, together have about 75,000 employees.

Tech Mahindra hired 4,413 employees in the first nine months of 2011/12, while Satyam added 3,014 new staff in the same period.

Shares in Tech Mahindra have jumped about 24% in the year to date and Satyam climbed 22%, both outperforming the sector's 4% rise and an almost flat bellwether Infosys Ltd.

In the merger, shareholders will get one share of Tech Mahindra for every 8.5 shares of Satyam, the two companies said March 21. — Reuters

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Gold sales tumble despite strike end as prices climb

Mumbai, April 10
Daily sales of gold are down 80% from a year ago so far this week from April 9 despite the end on Saturday of a 22-day strike when jewellers shut shop over taxes, as high prices are still hurting appetite.

Global gold prices rose about 1% to $1,655.16 an ounce on Tuesday. HDFC Bank quoted domestic prices for gold at Rs 28,405 per 10 grams, up 4% from March 17, when the strike started. — Reuters

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