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Exports marginally up by 3.79%, trade deficit down at $9.92 bn
New Delhi, February 11
A sharp compression in imports led to the trade deficit narrowing down to $9.92 billion although export growth continued to be sluggish for the third straight month.

SC questions Sahara’s claim of refunding Rs 25,000 crore 
New Delhi, February 11
The Supreme Court today questioned the Sahara Group over its claim of having refunded over Rs 25,000 crore in cash to about three crore investors and asked market regulator SEBI to find out as to whether there were legal provisions for dealing with such huge amounts, bypassing banking channels.

Vodafone conciliation talks fail, tax dept to collect Rs 20K-cr dues 
New Delhi, February 11
In a major jolt to talks with UK-based Vodafone, the government has decided to withdraw its conciliation proposal to sort out the Rs 20,000 crore tax dispute with the telecom giant and move ahead with the collection of dues.



EARLIER STORIES


Two-day bank strike ends, normal operations to resume today
New Delhi, February 11
The two-day strike by the employees of public sector banks, which had hit the banking operations, ended today. Normal banking operations will resume tomorrow. Employees of the public sector banks went on strike to press for a wage revision.

HPCL reports Rs 1,734-crore net loss in Q3
New Delhi, February 11
State-owned Hindustan Petroleum Corp Ltd (HPCL) today reported a net loss of Rs 1,734 crore in the December quarter (Q3) after the government paid less than half of the due oil subsidy.

CAG slams Rlys for loss in freight revenue
New Delhi, February 11
The Comptroller and Auditor General (CAG) has come down heavily on the Railways for losing revenue of around Rs 4,300 crore in 2008-2012 because of its failure to ensure proper documentation under the dual pricing system for transportation of iron ore.

US drags India to WTO over solar projects
Washington/Mumbai, Feb 11
The US has dragged India to WTO on the issue of the country mandating use of only local equipment for solar projects, a charge rejected by New Delhi  saying several American states practise protectionist policy for renewable  energy projects.





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Exports marginally up by 3.79%, trade deficit down at $9.92 bn
Weak domestic demand, curbs on gold lower non-oil imports
Sanjeev Sharma
Tribune News Service

New Delhi, February 11
A sharp compression in imports led to the trade deficit narrowing down to $9.92 billion although export growth continued to be sluggish for the third straight month.

The rupee also gained as a result by 21 paisa on better trade numbers and the dollar fell ahead of Fed Reserve chief Janet Yellen's testimony to US Congress.

Exports grew by a meek 3.79% in January to $26.7 billion but imports, particularly gold, fell, narrowing trade deficit sharply to $9.92 billion in the month. This number was almost half the deficit of $18.9 billion in January, 2013.

As per Crisil Research, import compression steepened while export growth edged up to narrow, bringing down the deficit to half.

In January, imports contracted sharply as weak domestic demand and restrictions on gold imports lowered non-oil imports by 22% compared to last year. In addition, a strong base effect contributed to the fall in imports. Gold imports contracted by 38% year-on-year from April-December 2013.

Crisil said export growth remained in single digit for the third consecutive month in January, edging up to 3.8% from 3.5% in the previous month. Export growth might have been capped by a continued fall in the value of petroleum exports in the month.

Exporters have expressed concern that the growth is slowing down. M Rafeeque Ahmed, president, Federation of Indian Export Organisations (FIEO), expressed concern over the declining trend in exports from October 2013 onwards.

Reacting to the trade data for the month of January 2014, he said the continued modest growth in exports is worrisome to achieve the targets for this fiscal. "The data of 3.4% growth during December, 2013 and 3.79% growth in January indicates that Indian exporters need immediate attention to bring exports back on track", the FIEO chief said.

FICCI president Sidharth Birla said "It is good to see that trade deficit has contracted for the seventh consecutive month. Nearly 48% reduction in trade deficit for the month implies close to 28% decline in our cumulative merchandise trade gap for the first 11 months of this fiscal. This significantly helps in containing current account deficit within sustainable levels near 2.5% of GDP".

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SC questions Sahara’s claim of refunding Rs 25,000 crore 
Asks SEBI to find out source of money
R Sedhuraman
Legal Correspondent

New Delhi, February 11
The Supreme Court today questioned the Sahara Group over its claim of having refunded over Rs 25,000 crore in cash to about three crore investors and asked market regulator SEBI to find out as to whether there were legal provisions for dealing with such huge amounts, bypassing banking channels.

A Bench comprising Justices KS Radhakrishnan and JS Khehar asked SEBI’s senior counsel Arvind Datar to find out how the group companies managed to mobilise the amount. If their cash payment claim was true, “they must have withdrawn the amount from somewhere,” it said.

Datar said the group had not given any proof to show the source of the money. The Sahara Group had given three volumes of documents, but not what the Bench had asked for - details of bank transactions showing the reverse flow of funds.

While documents showed how they had raised the funds from the market in the form of fully convertible debentures since 2008, there were no corresponding transactions to substantiate the refund claim, Datar said.

Pointing out that Sahara India had claimed to have mobilised Rs 25,199 crore in cash and paid Rs 29,878 crore as refunds, SEBI also wanted to know as to how it would account for Rs 4,700 crore, representing the difference between the two figures.

The Bench was hearing SEBI’s contempt petition against the group for its failure to refund the investors through the market regulator as directed by the apex court. The SC had issued the order while upholding the ruling of the Securities Appellate Tribunal that the debenture issue was illegal.

Sahara’s senior counsel Ram Jethmalani sought time for a week to reply to SEBI’s contentions as he was not feeling well. At this, the Bench posted the next hearing for February 20.

Appearing for Sahara chief Subrato Roy, senior counsel Aryaman Sundaram renewed his plea for letting his client undertake foreign visits to honour business commitments. The Bench, however, asked him to wait for the next hearing.

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Vodafone conciliation talks fail, tax dept to collect Rs 20K-cr dues 

New Delhi, February 11
In a major jolt to talks with UK-based Vodafone, the government has decided to withdraw its conciliation proposal to sort out the Rs 20,000 crore tax dispute with the telecom giant and move ahead with the collection of dues.

The Ministry of Finance has floated a Cabinet note seeking to withdraw the conciliation process with Vodafone International Holdings BV, sources said.

The Cabinet had in June last year approved a Finance Ministry proposal to go in for conciliation with Vodafone to resolve the capital gains tax dispute related to its acquisition of Hutchison Whampoa's stake in Hutchison Essar in 2007.

Although the Finance Ministry was keen on an amicable solution to the long-pending tax dispute, dilly-dallying by the company led to the collapse of the talks.

Sources said Vodafone wanted to club a Rs 3,700-crore transfer-pricing case of Vodafone India with the capital gains tax issue, a demand that could not be accepted by the FinMin. While the basic tax demand for the 2007 acquisition is Rs 7,990 crore, the outstanding dues, including a penalty of a similar amount and accrued interest, run into Rs 20,000 crore.

The Revenue Department, sources said, will pursue the tax demand along with accrued interest and penalty. The I-T Department had kept its tax notice to Vodafone in abeyance following the Cabinet decision to resolve the tax dispute through non-binding conciliation talks.

The Cabinet is now likely to soon take up the case as the Law Ministry has concurred with the FinMin’s proposal to withdraw from conciliation. — PTI 

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Two-day bank strike ends, normal operations to resume today
Tribune News Service

New Delhi, February 11
The two-day strike by the employees of public sector banks, which had hit the banking operations, ended today. Normal banking operations will resume tomorrow. Employees of the public sector banks went on strike to press for a wage revision.

Services such as cheque clearances and withdrawing and depositing of money in PSU bank branches were affected. In many places, ATMs also went dry resulting in hardship for retail customers.

Bank employees body AIBEA, which is a major constituent of the United Forum of Bank Employees’ Association that had called a nationwide strike, today said rejection of wage demands by Finance Minister P Chidambaram was "unfortunate" and the strike was forced on them.

Industry body Assocham has criticised bank employees' unions for an ill-timed strike, causing huge damage to the economy and the banking system resulting in delays of cheques which may be over Rs 16 lakh crore in the two-day period of disruption.

Assocham said pressure is being built for a 30% hike in wages when the public sector banks are battling their worst crisis of non-performing assets (NPAs). It said while the general banking customers and small trade is suffering delays in transactions, various other activities like payments of export-import also get affected.

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HPCL reports Rs 1,734-crore net loss in Q3

New Delhi, February 11
State-owned Hindustan Petroleum Corp Ltd (HPCL) today reported a net loss of Rs 1,734 crore in the December quarter (Q3) after the government paid less than half of the due oil subsidy.

HPCL had posted a net profit of Rs 147 crore in the same period a year ago.

The company posted losses "mainly on account of higher absorption of under-recoveries on sale of sensitive petroleum products," HPCL Director (Finance) K V Rao said.

HPCL absorbed Rs 3,192 crore after the government paid only Rs 2,328 crore subsidy for selling diesel, cooking gas (LPG) and kerosene at rates lower than cost.

The company had lost Rs 9,245 crore on selling diesel and cooking fuel below cost in third quarter this fiscal. It got Rs 3,705 crore from upstream firms like ONGC and Rs 2,328 crore from government. Sales rose to Rs 57,753 crore from Rs 55,165 crore in the corresponding period a year ago. — PTI

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CAG slams Rlys for loss in freight revenue
Tribune News Service

New Delhi, February 11
The Comptroller and Auditor General (CAG) has come down heavily on the Railways for losing revenue of around Rs 4,300 crore in 2008-2012 because of its failure to ensure proper documentation under the dual pricing system for transportation of iron ore.

In a report tabled in Parliament today, the CAG reported Railways' revenue loss at Rs 2,487 crore. It had reported a loss of Rs 1,796 crore for Railways in its 2011-12 report.

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US drags India to WTO over solar projects

Washington/Mumbai, Feb 11
The US has dragged India to WTO on the issue of the country mandating use of only local equipment for solar projects, a charge rejected by New Delhi saying several American states practise protectionist policy for renewable energy projects.

The US has challenged the domestic content requirement of India's solar mission, which requires solar power developers to use Indian-made equipment.

It notified the WTO Secretariat of a request for consultations with India concerning certain measures relating to domestic content requirements for solar cells and solar modules, according to the multilateral trade body. PTI

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BRIEFLY

RIL down over 2% after Delhi govt files case against Ambani
Mumbai:
Shares of Reliance Industries Ltd fell by over 2% on Tuesday after the Delhi Government ordered filing of criminal cases against its chief Mukesh Ambani and others, following complaints of irregularities in pricing of natural gas in KG basin. After falling 2.26% to Rs 803 in intra-day trade, RIL’s scrip finally ended at Rs 805.50, down 1.96% on the BSE. At the NSE, the scrip closed 2.21% lower at Rs 803.75. — PTI

FinMin gives Rs 10,000-cr subsidy to fuel retailers
New Delhi
: The Finance Ministry on Tuesday sanctioned Rs 10,000 crore as cash subsidy to fuel retailers like Indian Oil Corp to make up for part of the losses they incurred on selling diesel and cooking fuel below cost in December quarter. The sanction is against Oil Ministry's demand of Rs 26,000 crore. IOC will get Rs 5,172.87 crore while Bharat Petroleum Corp will get Rs 2,499.39 crore and Hindustan Petroleum Rs 2,327.47 crore. — PTI

Car sales drop 7.59% in January
Greater Noida
: Car sales in India fell for the fourth straight month in January this year with a decline of 7.59%, prompting industry body SIAM to seek government support in the upcoming interim Budget. As per data released by the Society of Indian Automobile Manufacturers (SIAM), domestic car sales stood at 1,60,289 units in January this year compared to 1,73,449 vehicles in the same month of 2013. — PTI

Gold, silver imports dip 77% to $1.72 bn in Jan
New Delhi
: Gold and silver imports declined 77% to $1.72 billion in January 2014 mainly due to restrictions imposed by the government on inbound shipments of the precious metal for narrowing current account deficit. Imports of gold and silver in January 2013 stood at $7.49 billion. — PTI

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