Financial Daily from THE HINDU group of publications
Tuesday, February 28, 2006
Markets (Feb 27)
BSE Sensex10282.09(+81.33)
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Economic Survey proposes reforms in tax system
Pegs growth rate at 8.1 per cent; cites crude prices as a risk factor

If the Economic Survey 2005-06, tabled in Parliament on Monday by the Finance Minister, Mr P. Chidambaram, is an indication of things to come, Indian industry can look forward to some relief on the taxation front. Specifically mentioning that the ... More

Interest rates may firm up: Survey
`Forex reserves accretion slowing, credit offtake keeps rising'

Financial health monitor
Case for RBI to unwind MSS for better liquidity.
Credit surge calls for adequate safeguards.
Banks need more capital to meet Basel II norms.
RBI norms on hybrid instruments will help More

`Rapid, bold policy responses needed to manage oil crisis'
Petro-product pricing crucial to fiscal health

Fault lines
Spiralling international petroleum prices not only create a pressure on Budgetary resources directly and indirectly through losses of oil PSUs, but have a debilitating effect on the performance of the industrial sector as a whol e. More

`Follow China model on labour market'
Revisit costs incurred on anti-poverty schemes

It's time to focus on the quality of outcome of the various social sector programmes rather than their quantity or coverage. More

Delhi, Mumbai airports revamp to begin mid-year
`In-principle' decision on Chennai airport revamp taken

The plan ahead
Proposals to set up greenfield airports in Navi Mumbai, Kannur in Kerala, Ladhowal near Ludhiana, and Pakyong near Gangtok.
AAI is also considering development of non-metro airports in many cities.
Inde pendent Airport Economic Regulator to be set up to monitor tariffs. More

Textile sector registers `moderate' export growth
Lags behind China in tapping free quota regime

The Government on Monday admitted to the country having failed to capitalise on the opportunities offered by the freeing of the global textile trade, having registered only a `moderate' export growth during the current financial year in contrast ... More

Govt told to clarify rationale for postal subsidy
The Economic Survey has said that the Government should clarify the rationale, mechanism and the size of the postal subsidy even as it pegged the deficit to increase from Rs 1,364 crore in 2002-03 to Rs 1,449 crore in 2005-06 (Budget Estimates). ... More

`Auto exports stay untapped'
The high-growth domestic automobile industry would attract a massive investment of Rs 80,000 crore by next year, but its export potential still remains untapped despite it gaining global recognition, the Economic Survey said today. "While a ... More

Need for reforming labour laws stressed
Learn lessons from the Chinese model, says Survey

The Chinese path
The Chinese labour market is characterised by a highly mobile labour force and despite hardships, workers in China appeared to have benefited from wage growth, additional job creation and new opportunities in self-em ployment. More

Govt sure of reining in inflation at 5 pc
The Government is optimistic of ending this fiscal at a 5 per cent inflation level, despite the volatile global petroleum prices. However, cautioning against the possibility of high and volatile global petroleum prices imparting "uncertainty" in ... More

Urban infrastructure: Call for user-charge approach
Smaller cities find the going tough due to financial crunch

Fresh approach
User-financed charges by institutions will lead to better access to capital markets.
Jawaharlal Nehru National Urban Renewal Mission is a key step forward.
Detailed planning is crucial to successful implementation. More

Broadband is the next frontier
The Economic Survey 2005-06 said that the telecom sector would need to address and harness the challenges being posed by the Internet and convergence. Even as the Survey said that the government and telecom players are doing well registering a ... More

All States told to implement VAT
The Economic Survey 2005-06 has called for early introduction of State-level value-added tax by the remaining eight States/Union Territories, stating that its non-implementation was creating ... More

Contracts for stretches under NHDP to be awarded soon
Award of contacts for road construction and improvement along North-South (NS) and East-West (EW) corridors connecting Srinagar with Kanyakumari and Silchar with Porbandar is likely to be completed by March. These stretches are under the ... More

India Inc says it's pragmatic
India Inc. has expressed satisfaction over the Economic Survey for 2005-06 released by the Government on Monday and called it pragmatic. The FICCI President, Mr Saroj K. Poddar, said the suggestions to de-bottleneck the infrastructure ... More


How critical is rural employment?
To bridge urban-rural divide

The Finance Minister has a challenge now. The growth rate depends on the investment in human capital. More


Automotive testing unit in Assam launched — Facilities to be used for N-E
Training for youth
The Silchar Centre will annually train about 1,000 youngsters to handle the latest automobiles.
The NATRIP facility is expected to be functional within the next two years.
It will help in the p roduction and export of low-priced, high-tech vehicles and components. More




JK Cement fixes IPO price at Rs 148
JK Cement has finalised the issue price of its recently concluded initial public offering (IPO) at Rs 148 per share. The company, a leading grey cement producer in Northern India, had entered the capital market with a public ... More


Food subsidy growth seen at 1.55 pc
Though the food subsidy bill is expected to grow in absolute terms in 2005-06, the annual rate of growth would hit a low of 1.55 per cent after a ten-year gap. It is expected to be at Rs 26,200 crore (budget estimates), against Rs 25,800 crore ... More

Fertiliser subsidy to exceed Budget estimates
Total subsidy may cross Rs 24,000 crore

Rising burden
Selling price of fertilisers remained constant since February 28, 2002 though input costs have increased rapidly.
Dept of fertilisers is formulating a revised policy for di-ammonium phosphate (DAP).
Wor king Group under the Chairmanship of Mr Y.K. Alagh formed for reviewing new pricing scheme. More

`Growth outlook bright'
The Finance Minister, Mr P. Chidambaram, today said that the country's economic growth outlook was "quite bright", reflecting the views expressed on this count in the Economic Survey for 2005-06 tabled by him in Parliament. "We are happy with ... More

Core sector growth slows to 3.3% in Jan
The growth in the six infrastructure sectors slowed down to 3.3 per cent during January 2006 compared with 4.2 per cent in January 2005 due to fall in output of crude petroleum and steel and reduction in production rate in the five sectors except ... More

India Inc positive on growth: Survey
The Finance Minister is expected to rationalise taxes and address issues of boosting infrastructure investments, according to a survey carried out by Federation of Indian Chambers of Commerce and Industry (FICCI). With strong ... More


EU move to boost carbon trading — All flights must buy credits to offset GHC emissions
THE carbon trading market may get a boost with the European Union decision to mandate all flights taking off from and landing in its territory to buy carbon credits for offsetting greenhouse gas (GHG) emissions. The in-principle decision to ... More


Indo-Arab meet begins — IT, medical tourism, bio-tech thrust areas
The Indo-Arab Economic conference, jointly organised by the Cochin Chamber of Commerce and Industry and Assocham, has called for greater co-operation between India and Arab countries in the areas of information technology, bio-technology and ... More


Three more Bio-safety Level 3 labs
The Inter-Ministerial task force set up to handle the outbreak of avian influenza has decided to set up three more Bio-safety Level 3 laboratories in Chennai, Kolkata and Delhi. Along with this, the Indian Council of Medical ... More

Will Budget bring relief to cancer, AIDS patients?
There could be some relief for patients suffering from cancer and AIDS, if Budget 2006 does indeed slash the different duties on critical drugs for treating these conditions. The apex Chemicals and Fertilisers Ministry has proposed Customs and ... More


Reconsider airport update plans: Panel
The Parliamentary Standing Committee on Transport, Tourism and Culture has called on the Government to "reconsider" its present plan on the modernisation and restructuring of the Mumbai and Delhi airports keeping in view the current domestic and ... More

KCCI to identify developers for multi-product component in SEZ
Since IL&FS Ltd has handled other SEZs in the country, it will be in a position to identify suitable developers for multi-product component in the SEZ. More


Panel to decide on gas transmission tariff of GAIL
The inter-ministerial group (IMG) will take a final decision on gas transmission tariff of GAIL (India) Ltd applicable for Hazira-Vijaipur-Jagdishpur (HVJ) pipeline. The Government has decided to refer the recommendation of the Tariff ... More

Gas supply issue: Meet today to resolve deadlock
Chiefs of Panna-Mukta venture partners, GAIL to participate

The conflict
The PMT partners had sought the Ministry's permission to sell six MMSCMD of gas from the fields, currently being given to GAIL, directly to clients at market price from April.
GAIL and ONGC have been holding co nflicting views on their claims on an agreement for selling gas beyond March 31 this year from the PMT fields. More

High credit rating for ONGC bonds
CRISIL and ICRA have assigned high credit rating to ONGC's Rs 50 crore notional non-convertible debenture issue. According to a company statement, while CRISIL has given AAA rating, ICRA has also assigned a long-term AAA rating. ... More


CDC supplies diagnostic reagents for bird flu investigation
Testing the outbreak
CDC reagents could test a series of avian flu virus variants to establish the type currently hitting India.
National Institute of Virology was sharing its data with the CDC about the outbreak of avian f lu in Navapur. More

Pharma industry clocks healthy growth
Leverage strengths in organic synthesis, process engineering

The prescription
Task force set up to make life-saving drugs affordable.
Plan outlay for the Central Health Sector Schemes in 2005-06 is Rs 2,908 crore.
National Council on AIDS set up for combating spread of HIV/AIDS. More

NPPA recovers Rs 99 cr from drug cos
The drug price regulator, National Pharmaceutical Pricing Authority (NPPA), has recovered Rs 98.76 crore till January, 2006, from companies that were overcharging their drugs. In a written reply to a question in Lok Sabha, the ... More


Concern over power sector
Painting a gloomy picture of the country's beleaguered power sector, the Economic Survey estimates the overall losses to the economy on account of the sector at a massive Rs 3,00,000 crore. Faster reform initiatives, ensuring adequate fuel ... More

`Electricity to all houses'
"All houses in the country, even in remote villages, will have access to electricity by March, 2009," the Union Power Minister, Mr Sushilkumar Shinde, has said. He clarified that the UPA Government at the Centre was committed to implement the ... More


Sponge iron issues
ANNUAL MEET: The Minister of State for Steel, Dr Akhilesh Das (right), having a word with Mr Sandeep Jajodia, Chairman, Sponge Iron Manufacturers Association, at the 13th AGM of the association in the Capital on Monday. ... More


Misplaced optimism?
Sugar output figures

"Availability and prices of sugar in the current season (2005-06) are expected to remain at reasonable levels," according to the Economic Survey which says sugar production during 2005-06 is expected to be 17.5 million tonnes (mt), up from around ... More


Will Budget dilute FBT provisions, usher in EET?
Lower level of peak customs duty, rationalisation of duties for petroleum industry likely

Insurance FDI hike?
Mr Chidambaram may also reiterate the Government's resolve to hike FDI in insurance to 49 per cent. More

Cotton growers worried over likely duty cut
Growers of extra-long staple (ELS) cotton, a superior variety, are an unhappy lot because of falling prices. Despite a shortage in the market and strong world prices, domestic prices have been on a downturn last two months. They are now worried ... More


Textile industry seeks special rules of origin provisions
Call for safeguards
Even in the categories of textiles, Change in Tariff Heading would not provide adequate safeguard against third country circumvention.
The industry is more than convinced that Change in Tarirr Sub Headin g, even with certain moderate levels of local sourcing, would not provide any comfort to the industry. More


NTPC plans joint venture with Coal India
National Thermal Power Corporation (NTPC) proposes to set up a 50:50 joint venture coal company with Coal India Ltd (CIL), to develop new coal mines for exclusively meeting the corporation's additional coal requirement at its thermal power ... More


AC to beat bird flu?
Consumer goods companies claiming that their products help improve the health of their consumers is nothing new. But how about saving a person from a deadly epidemic? Consumer electronics firm LG Electronics claims it has developed ... More


Food processing: Govt bid to woo big biz houses
Big thrust
Ministry push for creating a favourable fiscal environment
Rabo Bank study to serve as guidebook More


Foundation stone laid for three RPG group projects
Goenkas tie-up with Godrej Group for shopping arcade

Performance -oriented
The group has decided to convert non-performing assets into profitable ventures, largely in the real estate area.
An internal study about the number of non-performing assets and also the value of such assets is being done. More


IT cos seek tax reliefs
MAIT wants excise anamolies removed

THE IT industry is hoping that the key sectoral issues pertaining to Fringe Benefit Tax, BPO taxation and the current CENVAT overflow arising out of nil excise duty on finished hardware products are addressed in the Union Budget on Tuesday. ... More


Coimbatore textile fair to feature `China Pavilion'
Over 300 companies covering all segments will be participating

Fair choice
Many original equipment manufacturers from China will be present.
Ring spinning, weaving and processing equipment will be on display. More


Biotech industry seeks extension of deductions
The biotechnology industry, under the aegis of Federation of Indian Chambers of Commerce and Industry (FICCI), has urged the Union Finance Ministry to allow deductions to companies carrying on scientific R&D approved by the prescribed authority . More


A touch of glass
Transparence, a competition that brings students into mainstream architecture, aims to increase awareness of the potential of glass in architecture. According to Mr B. Santhanam, Managing Director, Saint-Gobain Glass India Ltd, which organised ... More


Exim Bank to invest $7 m in animated feature film
Rich Crest-Lions Gate's production

The Export-Import Bank of India (Exim Bank) will invest $7 million in the proposed full-length animated feature film from Crest Animation Studios' 87 per cent US subsidiary, Rich Crest, and Lions Gate Entertainment. The movie, meant for a ... More


Women managers' meet on March 8
Theme inspired by Kalam's vision

Gender justice
The association has invited thought leaders to do some forecasting. More


`Core sector can absorb $150 b FDI'
India has potential to absorb $150 billion foreign direct investment (FDI) in the infrastructure sectors alone by 2010. Simultaneously, opening up of single brand retail for FDI holds up further ... More


ICRISAT partners CII in rural growth plan
Livelihood options
ICRISAT will soon join the developmental initiative launched in Dungarpur while CII plans to replicate the model elsewhere. More


TRAI says `end differential tariff'
The Telecom Regulatory Authority of India (TRAI) has asked mobile service providers in Maharashtra, Tamil Nadu, West Bengal and Uttar Pradesh not to have higher tariffs for calls made to BSNL subscribers. The move comes after consumers ... More


Goan assessees for changes in I-T Act
Goan assessees hope that the Union Budget this year will have suitable amendment to Section 5A of the Income Tax Act (I-T Act) which has adversely affected salaried tax payers of Goan origin. The Goa Youth Congress President, Mr Guirish ... More


I-T Dept to step up vigil against tax offenders
The Income-Tax Department is gearing up its machinery to have greater surveillance in order to increase the revenue. At a press conference here on Monday, the I-T Director-General (Investigation), Mr J.L. Giridhar, said the thrust was on ... More

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Top Stories
Fertiliser subsidy to exceed Budget estimates
Total subsidy may cross Rs 24,000 crore

Will Budget bring relief to cancer, AIDS patients?

LIC plans to invest Rs 13,000 cr in equities — Favours bank stocks

Interest rates may firm up: Survey
`Forex reserves accretion slowing, credit offtake keeps rising'

Core sector growth slows to 3.3% in Jan

Gas supply issue: Meet today to resolve deadlock
Chiefs of Panna-Mukta venture partners, GAIL to participate

In Focus

Infrastructure woes stare IT sector
IPO Scams
FDI in retail sector
Dynamic Tirupur
Surging Sensex
Gold scaling new highs

In Depth

Gender Justice
Simple Economics
Tax Talk

Looking back
Feb. 19-Feb. 25
Equity funds eye realty sector in a big way
To explore investments in residential, commercial projects

Bird flu: No human infection reported so far, says Health Secy

Well-cooked chicken, eggs safe, says Govt

Pharma cos buck up; busy lining up drugs

FM stations to zoom in on regional ads in small towns

Centre may not allow sale of Tamiflu in retail market — `Drug has adverse side-effects, not safe for children too'

Shortfall likely in direct tax collection this fiscal

Air India places $2-b order for GE engines

Govt yet to decide on DAP subsidy

Hectic lobbying on by vegoil refiners against cheap imports

Bankers seek lower service tax on credit cards

Pawar calls for restraint in bird flu reports — Don't create panic, media told

Govt cautious on opening up retail FDI — Exploring role model for multi-brand segment

IPO scam fall-out — CBI conducts search at Karvy, Vijaya Bank, BhOB premises

IMF cautions India on the fiscal front

`Bird flu scare results in Rs 200-cr loss to truckers'

Poultry insurance covers bird flu losses, clarify officials

Bihar provides a sweet cure for sugar sector — Offers attractive incentive; plans PSU units privatisation

Railway budget to take care of all sections — Lalu Prasad rules out increase in passenger fares

Kochi region excise revenue

Unsold stocks worry poultry farmers

Railways improves freight earnings by Rs 3,000 cr

Low-cost carriers see no impact — Travel sector hails move

Airlines not perturbed by reduced AC rail fares

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