B U S I N E S S

Spectrum auction may prove a big damp squib
New Delhi, November 10
Two days before the all important 2G spectrum goes up for auction, it seems that this Diwali may not prove to be too bright for the government in the absence of aggressive bidding from the telecom operators participating in it.

Buying gold this Dhanteras will come with a hefty price tag
Mumbai/New Delhi, November 10
Prices of gold jewellery could go up sharply on Dhanteras on Sunday with the yellow metal poised to touch new highs later this year due to festival demand, according to traders.
Gold is likely to add more ground on the Dhanteras festival today.

Obama wants tax hike on rich
Washington, D.C., November 10
President Barack Obama said Friday he was prepared to compromise with Republicans to avert a looming US fiscal calamity, but insisted a tax increase for the rich must be part of any bargain.

investor guidance
Repatriation of funds in NRO fixed deposit accounts
For the past four years I have been residing in India but now plan to return to the United States. During this time I have invested in bank fixed deposits and other instruments where the interest rate is quite high. All my FDs were for a five-year tenure, so there is one more year left for them to mature.

Spectrum auction may prove a big damp squib
Tribune News Service

New Delhi, November 10
Two days before the all important 2G spectrum goes up for auction, it seems that this Diwali may not prove to be too bright for the government in the absence of aggressive bidding from the telecom operators participating in it.

While Sunil Mittal, chairman & group CEO of Bharti Enterprises, has said that given the high reserve price, the auction could end on the first day itself, market watchers point out the final bid price may not be too different from the reserve price in the 1,800 MHz band.

The other 800 MHz band, which is mostly used for the CDMA operations will anyway not see any auction with the initial two bidders-Videocon and Tata Telecom-both withdrawing from the bidding process with the executives in these companies saying that they did not see a 'business case' in garnering these air waves as the base price for this frequency has been fixed at 1.3 times as that of GSM.

While the government aims to garner Rs 40,000 crore from the spectrum sale, analysts say it will fall short of its estimates by a significant amount. The telecom department has confirmed all bidders for GSM airwaves — Bharti Airtel, Vodafone, Idea Cellular, Telenor and Videocon — had confirmed they would participate in the auction for spectrum in the 1800 MHz frequency.

Incidentally, no GSM operator is bidding for airwaves on a pan-India level. Analysts say there would be few cellular circles, if any, where some competition might be seen.

Buying gold this Dhanteras will come with a hefty price tag
TNS & Agencies

Mumbai/New Delhi, November 10
Prices of gold jewellery could go up sharply on Dhanteras on Sunday with the yellow metal poised to touch new highs later this year due to festival demand, according to traders.

Gold prices had fallen to below Rs 31,000 per ten grams in the last week of October but have bounced back following higher demand. "Many people who booked gold jewellery at lower prices for taking delivery on Dhanteras are now looking smart," says Vipul Choksi, a jeweller in Borivli in suburban Mumbai.

However, because of the poor business sentiment and soaring prices there were not many people who were booking gold jewellery at lower prices. Even now, gold sales are lower on volume terms. "We’re selling 40% lower in terms of volume, but in value terms sales are up”, Choksi added.

Gold ended on a promising note on the eve of Dhanteras in the bullion market on Saturday, completing six days of gains, by adding Rs. 85 to Rs. 32,125 per 10 gms on stockists’ buying to meet the festival demand amid firming global cues.

Buying activity gathered momentum as stockists expect hike in sale on Dhanteras, considered to be an auspicious day in Hindu mythology for making new purchases, especially precious metals. Another auspicious festival, Diwali, on Tuesday and reports of firming global trend continued to bolster the market sentiment.

Silver also spurted by Rs. 700 to Rs. 61,500 per kg on increased off-take by industrial units.

Gold rose in global markets as speculation that the US will expand monetary stimulus following President Barack Obama’s re-election push up demand for the metals as a store of value. The metal rose 0.3% to US $1,730.90 an ounce in New York, the highest since Oct 19.

On the domestic front here, gold of 99.9% and 99.5% purity in a week-long rally added Rs 85 each to Rs 32,125 and Rs 31,925 per 10 gm, respectively, after gaining Rs 1,090 in last five sessions. Sovereign held steady at Rs 25,500 per piece of 8 gms.

Silver ready also notched up a gain of Rs 700 to Rs 61,500 per kg and weekly-base delivery by Rs 615 to Rs 60,915 per kg. However, silver coins plunged by Rs 1,000 to Rs 77,000 for buying and Rs 78,000 for selling of 100 pieces.

Obama wants tax hike on rich

Washington, D.C., November 10
President Barack Obama said Friday he was prepared to compromise with Republicans to avert a looming US fiscal calamity, but insisted a tax increase for the rich must be part of any bargain.

Obama, who was re-elected on Tuesday, reminded Republicans that his approach to avoiding steep tax hikes and spending cuts due in January, which could trigger another recession, had just won the backing of Americans at the polls. His spokesman said he would veto any deal that did not include an extra contribution from the wealthiest.

Obama invited Congressional leaders to the White House next Friday to discuss the issue, the most pressing challenge as the president prepares to starts his second term in office. He said the majority of Americans believed those making more than $250,000 a year should pay more taxes. — Reuters

investor guidance
Repatriation of funds in NRO fixed deposit accounts
A.N.Shanbhag

For the past four years I have been residing in India but now plan to return to the United States. During this time I have invested in bank fixed deposits and other instruments where the interest rate is quite high. All my FDs were for a five-year tenure, so there is one more year left for them to mature. By the time this happens I will be in the US. How do I get the funds to the US and what are the tax implications, if any?

— Adarsh Deshmukh

When you move back to the United States again, essentially you’d be giving up Indian residency and becoming a nonresident Indian. An NRI is not allowed to continue with his Resident bank accounts, whether savings or fixed deposits. So you will have to get all your resident bank accounts converted to NRO (Non-Resident Ordinary Rupee) account. This can be done when you are here (before leaving), depending upon your visa/ passport status — your bank will help you. Once the accounts are converted into NRO, you can continue them as long as you desire. If the monies are to be brought back to the US, you would have to submit Form 15CA and Form 15CB to the bank.

How much tax deduction is available in respect of mediclaim? Can I buy a policy for my parents and claim deduction since they no longer have any taxable income?

— Rahate

You an claim an income tax deduction of Rs 15,000 in respect of mediclaim premium paid for yourself, your spouse and your children. There is an additional deduction of Rs. 15,000 available in respect of mediclaim premium paid for policies in the name of your parent/s. If such parent is a senior citizen the amount of Rs. 15,000 stands enhanced to Rs 20,000.