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FDI may open way for Indians to buy into foreign carriers, one day
FM pitches for PM-led Investment Board
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investor guidance
ATF price hiked by 2%
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FDI may open way for Indians to buy into foreign carriers, one day
New Delhi, September 15 Sounds far-fetched but the proposal, which has received a thumbs up from the industry and escaped from a political resistance as in the case of FDI in retail, has the potential of paving the way for Indians making an entry to the foreign airline businesses, this is what an independent auditor KPMG believes. Amber Dubey, head of KPMG-India’s Aviation Practice, says the idea may sound unimaginable today but just like no one had imagined that iconic brands like Arcelor or JLR could be owned by Indians one day. “This could lead to establishment of new airlines in India and perhaps, a change in the ownership structure of certain Indian carriers. All this is good for Indian passengers. Increased competition would lead to better offerings, greater efficiency, cheaper airfares and more power to the passenger,” he said. Experts, however, believe unless ATF costs are rationalized to bring down the operating costs, there will be no cost advantage to even well-heeled foreign investors. Just allowing foreign carriers to invest in India will not solve the problems of high costs that plague the sector. Efforts made by successive civil aviation ministers to convince the states to reduce taxes on ATF have been in vain so far but there is a view that liaison with a global player will provide some good fuel options to the Indian partner. Concerns are also there about the issue of price cutting by global carriers, losses to Indian airlines and threat to national security. Burdened with a debt of over Rs 7,000 crore, opening up of this sector may fulfill some dreams of the cash-strapped Kingfisher Airlines and to some extent of GoAir and Spicejet but more successful players in the pack, Jet Airways and IndiGo, have not been too keen on the move. Meanwhile, FICCI president R.V. Kanoria said: “The possibility of new JVs entering the market with the help of foreign strategic partners will result in better competition and more choices for the consumer. Improved customer service standards and reduced tariffs will follow in this sector as well.” According to CII president Adi Godrej, the move will bring much required capital into the industry thereby enabling healthy recapitalization of airlines, promoting vital connectivity and providing benefits to all stakeholders including banks. |
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FM pitches for PM-led Investment Board
New Delhi, September 15 "The NIB's authority should extend to proposals and projects where the investment is above a certain threshold, say, Rs 1,000 crore. Once the final decision is taken by the NIB, no other ministry or department or authority should be able to interfere with that decision or delay its implementation," he said during his intervention at the meeting of the full Planning Commission. Chidambaram regretted that under the present dispensation, "a truly `final' decision (on projects) does not emerge for many years". He said outlays in the 11th Five Plan felt short of targets mainly because of failure to achieve physical targets in areas like power, coal, roads. The minister said the 12th Plan's proposal to reduce subsidy from 1.9% of GDP in the budget estimates of 2012-13 to 1.2 % in 2016-17 as "over-optimistic". According to the Minister, "the estimated major subsidies in 2012-13 would be around 2.4% of GDP, and a sharp fall as assumed in the Plan may be over-optimistic. Direct cash transfer of subsidies in food, fertilizers and petroleum will help in this reduction. "I would urge that by the end of the 12th Plan, these three major subsidies be rolled out across the country through direct cash transfers to the beneficiaries. Pilot projects are already under implementation for LPG and kerosene and it is our intention to extend the direct transfer mechanism to the UTs in the first phase," he added. On the investment side, the minister said, the gross budgetary support during the entire 12th Plan period has been estimated at Rs 35.68 lakh crore which works out to 5.23% of GDP over the 5 year period.
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Switching mutual fund option attracts securities tax
A.N. Shanbhag Recently I applied for change of option in one of my mutual fund schemes from dividend payout to reinvestment option. The mutual fund had deducted STT from my account, saying it was a switch from one option to another and that STT was payable. What precisely is this deduction? — Amitabh Singh
My annual salary is below Rs 5 lakh and so, I have not filed any tax return for FY2011-12. This year my maternal uncles have deposited Rs 51,000 each in my savings bank account as gifts and I had accepted them with thanks notes. Should I show the gifted amount in my tax return? Is there any tax liability on these? — Akhil Gupta You have misinterpreted the new provision that exempts a few employees from filing tax returns under certain conditions. An employee whose total salary, after allowable deductions and interest from a savings bank account (not over Rs 10,000) does not exceed Rs 5 lakh, need not file tax returns provided he has provided his employer details of income from other specified sources. The gift of Rs 102,000 you got is not taxable as it was received from close relatives.
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New Delhi, September 15 ATF at T3 terminal in Delhi has been hiked by Rs. 1,429 per kilolitre (kl), or 1.97%, to Rs. 73,711 per kl with effect from midnight tonight, according to Indian Oil Corp, the largest fuel retailer. On Thursday the government had announced the first hike in diesel rates in more than 14 months, raising rates by Rs. 5.63 per litre to Rs. 46.95. The price hike is the fifth straight increase in jet fuel rates since July. — PTI
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MUMBAI CHENNAI New Delhi
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Switching one option of any mutual fund to another, even of the same scheme, is considered a “transfer” and hence capital gains provisions become applicable. However, switching from dividend option to dividend reinvestment option is not a transfer and therefore no securities transaction tax is applicable. You should take up this matter with the mutual fund concerned and request corrective action.
Re closes at over 2-mth high