New Delhi, March 25
Millions of small savers and PPF account holders will earn less on their post office savings schemes, with the government deciding to reduce interest rates on them marginally by 0.1 per cent.

The interest rate of Public Provident Fund (PPF) has been lowered from 8.8 per cent to 8.7 per cent with effect from April 1, 2013, said a Finance Ministry statement.

This decision is aimed at reducing the returns on small savings schemes so that banks can reduce deposit rates, which they have not been able to do even as RBI has cut rates twice. High deposit rates mean that in turn rates on loans cannot be brought down as the same funds are used to lend further. Another problem for the banks is the growth in deposits has been tardy and they are therefore finding it difficult to reduce deposit rates for fear that they slow down further.

The rates on savings deposit schemes and on fixed deposit of up to one year run by post offices has been kept unchanged at 4 per cent and 8.2 per cent, respectively. Further, monthly income schemes (MIS) of 5-year maturity will earn an interest of 8.4%.

The National Savings Certificates (NSCs) having maturity of five and 10 years will now attract 8.5 per cent and 8.8 per cent interest, respectively, down 0.10% each. The interest rates would be applicable for the entire 2013-14 fiscal. The rate for Senior Citizens Savings Scheme (SCSS) will now stand at 9.2%, down from 9.3%.

The revision in interest rates follows a decision taken by the government last year to link the small savings returns with the market rate. The new rates are required to be announced at the beginning of a financial year. The decision is in line with the recommendations of Shyamala Gopinath Committee, which had suggested that returns should be in sync with market rates determined by the returns offered by other securities.

Chandigarh, March 25
The imposition of ‘sin tax’ in Punjab is in line with a new policy adopted across the North Indian states to raise the tax on cigarettes and other tobacco products. The idea behind imposing sin tax is to raise the tax on these products so as to bring down its consumption.

The Punjab Government, in its Budget proposals for 2013-14, has increased the Value Added Tax (VAT) on cigarettes from 22.5 per cent to 55 per cent. Cigarettes worth Rs 500 crore are sold in Punjab per annum and the state earns Rs 120 crore as VAT on the sale of cigarettes. With this hike, the state hopes to collect VAT on cigarettes to the tune of Rs 200 crore. This money will now be used to fund the cancer treatment of poor patients, besides setting up drug de-addiction centres in the state.

Though the Punjab Cigarette Seller Association is up in arms against the government’s proposal for raising the tax slabs, claiming that it will lead to diversion of business through increased smuggling of cigarettes and its illegal sale, the Punjab Government says the idea behind increasing the tax was to enhance public health by bringing down the cigarette consumption.

AK Dutta, president of the association, said Punjab had been increasing taxes on cigarettes every year and this had led to a 3-4 per cent decline in business every year.

“Last year, the state government had increased VAT on cigarettes from 14.5 per cent to 22.5 per cent, and this year it has been doubled to 50 per cent and a 10 per cent surcharge has also been imposed, taking it to 55 per cent,” he said. He said other state governments, who had been increasing the tax rates, had actually witnessed a fall in VAT collection after the hike as diversion in business increased.

Senior officials in the Punjab Excise and Taxation Department told The Tribune that Punjab was following a decision taken by all North Indian states to impose sin tax on cigarettes and other tobacco products. “Though states like Rajasthan have increased the VAT on all tobacco products, we have only increased it on cigarettes. The hike in VAT is in line with the hike imposed by other states. Rajasthan has raised the VAT to 60 per cent, Himachal Pradesh to 36 per cent, Jammu and Kashmir to 40 per cent and Uttar Pradesh to 50 per cent. The only states which have not followed suit are Haryana and Delhi and these states are also being asked to increase the VAT on tobacco products,” an official of the department said.

The Punjab Cigarette Seller Association has alleged that 33 per cent of the total cigarette business in Punjab is under unorganised sector as illegal cigarette manufacturing units in Nakodar and Ludhiana are selling cigarettes at very low prices because they don’t pay any VAT or central excise duty.

The Association said sale in the unorganised sector would increase with the hike in cigarette prices, as more and more people will switch to these less expensive cigarettes.

Officials in Excise and Taxation Department, however, claimed that they were in the know of things regarding the illegal cigarette manufacturing units and inspections and on these two units were being conducted. 

New Delhi, March 25
The GSM Association (GSMA), the worldwide umbrella body for mobile operators, has called upon the Indian government to cut down base price of the spectrum which is to be put on auction again. In the recent auction, the government had failed to attract bidders in the GSM segment while there was just one bidder in the CDMA segment.

Anne Bouverot, Director-General, GSMA, said the absence of bidders for the 1800 and 900MHz and a lone bidder in 800MHz for the spectrum auction earlier this month, which includes frequencies that remained unsold from the November 2012 auction, is a clear signal that mobile operators are not willing to pay unreasonably high prices for spectrum.

“The GSMA reiterates its call to the Indian government not to use spectrum as a means to raise short-term revenues and reduce the proposed reserve prices for the upcoming auction. Focus should be on the longer term and creating a healthy business environment where the mobile industry can invest with confidence,” Bouverot said.

The GSMA represents the interests of mobile operators worldwide. Spanning more than 220 countries, the GSMA unites nearly 800 of the world’s mobile operators with more than 230 companies in the broader mobile ecosystem, including handset makers, software companies, equipment providers and Internet companies, as well as organisations in industry sectors.

“Acquiring spectrum is only the first step before making the necessary investment in network deployment to deliver mobile services to consumers. Unreasonably high reserve prices lead to spectrum remaining unsold, delays in the delivery of mobile services and ultimately, an increase in consumer tariffs,” she said.

New Delhi, March 25
Tata Consultancy Services (TCS) and global outsourcing services firm Capgemini have been awarded contracts worth $43 million (about Rs 233 crore) each from Norway Post to operate and manage its applications.

The six-year deal encompasses delivery of a wide range of services across Norway Post's core portfolio of 55 applications. It delivers over 36 million packages and 2.2 billion letters annually.

"Apart from being selected to deliver application services across core postal value chains, TCS has also been entrusted to coordinate and drive the overall transition and transformation programme across multiple vendors," TCS said.

Through this initiative, Norway Post is implementing a structured multi-sourcing model to drive efficiency and support their Nordic integrated business strategy, it added.

Norway Post said it has chosen Capgemini and Tata Consultancy Services (TCS) to operate and manage most of its applications.

"The estimated value to each of the suppliers Capgemini and TCS during the contract period is around 250 million Norwegian Krone (KOR)," it added.

Capgemini has 103 Nordic customers and around 4,500 employees in the Nordic region.

TCS's Nordic operations (an operating area cutting across Sweden, Finland, Norway, Denmark and Iceland) comprise over 5,000 professionals, servicing leading Nordic companies such as Nokia, Ericsson, TDC, ABB, Telenor, NETS and SAS. — PTI 

New Delhi, March 25
Market regulator SEBI plans to put in place a stronger and more effective surveillance system in the next fiscal 2013-14, by way of greater checks against money laundering and an overhaul of its regulations for various market entities and trade activities.

The measures proposed to be taken in the fiscal beginning next month include enhanced surveillance of derivatives market, first-stage monitoring by brokers, stronger audit mechanism for market entities and review of anti-money laundering and terror combating funding norms.

Besides, SEBI also plans to bring in guidelines to address conflict of interest for credit rating agencies, introduce regulatory framework for foreign intermediaries soliciting business from investors in India and put in place a centralised KYC framework for the entire financial sector.

The proposed steps are part of SEBI’s budget proposals for the year 2013-14, which have been approved by its Board and would be implemented during the course of the year.

One of the top priorities identified by SEBI for 2013-14 would be "protecting the integrity and safety of the market through a stronger and more effective surveillance mechanism and by strengthening the inspection process of intermediaries", a senior executive said.

SEBI is also planning to strengthen its manpower in the next fiscal, besides greater efforts towards training and skill building of existing staff members.

The regulator would also strengthen its Data Warehousing and Business Intelligence System (DWBIS), the project which has been initiated in phases to generate reports to identify, detect and investigate aberrations and market abuses that undermine market integrity.

In its budget proposals, SEBI also said it is necessary for the intermediaries to maintain high levels of compliance with the stipulated norms.

In order to provide the services to the investors at their door step and to promote a balanced securities market, SEBI is also working on enhancing the physical proximity of SEBI offices to investors and intermediaries.

While 10 new local offices are expected to be functional by the end of this month, six more local offices are proposed to be opened during the year 2013-14.— PTI

New Delhi, March 25
Haryana Chief Minister Bhupinder Singh Hooda today said strong governance is a must for sustainable growth. Participating in a panel discussion organised by CII, Northern Region, here today, he said commitment and political will is vital for strong governance.

Hooda said there are four basic parameters for growth. These are per capita investment, per capita income, expenditure and resource mobilisation. In per capita investment, Haryana was at 14th position in 2005 when he became the Chief Minister and today it is at number one position in the country.

The per capita income of Haryana is the highest among the bigger states. As for the per capita expenditure, Haryana is the leading state among big states, the per capita plan expenditure being Rs 10,700. In resource mobilisation, Haryana has outperformed all other states during the 11th Plan. Haryana mopped up resources up to 192 per cent of the projected mobilisation, which is much ahead of 96 per cent in Gujarat and national average.

He added that the Haryana Government had set the priority of improving education, better health services, industrialisation for increasing employment and improving basic infrastructure. 

New Delhi, March 25
Both the precious metals — gold and silver — extended losses in the national capital today on sluggish demand.

While gold fell further by Rs 130 to Rs 30,125 per 10 gram, silver fell by Rs 15 to Rs 54,400 per kg on reduced offtake by jewellers and industrial units.

Traders said sluggish demand due to off-marriage season mainly kept pressure on both gold and silver prices.

On the domestic front, gold of 99.9 and 99.5 per cent purity fell further by Rs 130 each to Rs 30,125 and Rs 29,925 per 10 grams, respectively. — PTI