Mumbai/ Ahmedabad: Chinese TBEA Shenyang Transformers group today expressed its willingness to set up a high-voltage power transformers and solar energy equipment manufacturing facility near Vadodara.
A high-level Chinese delegation led by TBEA transformer industrial group chairman Zhang Xin and TBEA Shenyang transformer group chairman Ye Jun presented the papers to the state government with a desire to start the construction for the projects in September 2011 and commission the plant in a year by September 2012.
Narendra Modi, chief minister of Gujarat hinted at developing the Central Gujarat region as an energy equipment manufacturing hub in the country's power sector.
Success in my Habit
Tuesday, May 31, 2011
Renault launches its premium sedan Fluence at Rs 12.99 lakh
New Delhi: French carmaker Renault has re-entered the Indian market with the launch of its premium sedan Fluence at 12.99 lakh (ex-showroom, Delhi) for the diesel variant and 14.40 lakh for the fully-loaded petrol version.
The company had partnered with Indian utility vehicle maker Mahindra & Mahindra to introduce Logan sedan in 2007, but had failed to impress Indian customers due to its dated design that led to dwindling sales of the car.
Eventually it pulled out of the joint venture and started its own 4 lakh cars a year greenfield plant in Chennai with its global partner Nissan Motors of Japan, where the Fluence is being currently manufactured.
"We are making a new beginning in India. Logan has given us a good learning about the Indian market and customers," Renault India MD Marc Nassif said. We know what the customer want and have worked hard to customise the new Fluence sedan for the local market," he added.
The twin-variant Fluence comes with advanced features like anti-lock brake system and multiple airbags but is competitively priced against other cars like Skoda Laura, Honda Civic and Toyota Corolla .
The company had partnered with Indian utility vehicle maker Mahindra & Mahindra to introduce Logan sedan in 2007, but had failed to impress Indian customers due to its dated design that led to dwindling sales of the car.
Eventually it pulled out of the joint venture and started its own 4 lakh cars a year greenfield plant in Chennai with its global partner Nissan Motors of Japan, where the Fluence is being currently manufactured.
"We are making a new beginning in India. Logan has given us a good learning about the Indian market and customers," Renault India MD Marc Nassif said. We know what the customer want and have worked hard to customise the new Fluence sedan for the local market," he added.
The twin-variant Fluence comes with advanced features like anti-lock brake system and multiple airbags but is competitively priced against other cars like Skoda Laura, Honda Civic and Toyota Corolla .
PE, M&A activities in logistics, transport sectors to get further momentum
Mumbai: Merger and acquisition (M&A ) and Private equity (PE) activities in the transport and logistics sector in the country during the first five months of 2011 have seen a significant increase as compared to that for the same months last year. Last month alone witnessed five deals, including Warburg Pincus putting $100million in Continental Warehousing Corporation, Fidelity Growth Partners investing $13.5 million in Transpole Logistics and Aqua Logistics taking over Nikkos Logistics. Given the hectic activities, sources familiar with the development are expecting to see at least one deal every month on transport infrastructure and logistics sectors of the country .
On the PE side, scores of India-focused funds managing over $20 billion are now eager to deploy capital given the recent slowdown. On the M&A side, the country presents itself as an ideal ground where industry consolidation has only just begun . PE firms that have successfully exited last year after amassing a cool $5.4 billion are also giving investors the necessary confidence about the accelerating growth of the economy , fast approaching $2 trillion in size, and its ability to give healthy returns.
There have been over 160 deals in the infrastructure sector in the last five years alone making it one of the most active M&A sectors in India today.
If there is any particular segment that is enjoying good attention of fund managers as well as strategic buyers, it is the freight forwarding industry.
According to Wikipedia, a freight forwarder, forwarder, or forwarding agent is a person or company that organises shipments for individuals or other companies and may also act as a carrier. A forwarder is often not active as a carrier and acts only as an agent, in other words as a third-party (non-assetbased ) logistics provider that dispatches shipments via assetbased carriers and that books or otherwise arranges space for these shipments.
According to Chetan Dikshit, director – Rothschild India, freight forwarding continues to receive a premium as compared to 3PL businesses in the global strategic M&A landscape .
"Unlike the west and the other developed world, India's freight market is dominated by forwarders ," said Gautami Seksaria , founder and partner, Supply Chain Leadership Council, an organization seeking to create an active community of industry stakeholders in the wider transport and logistics sector. "They control customer relationships and play the crucial role of consolidating cargo volumes for carriers ."
With few entry barriers, the freight forwarding sector has traditionally seen an influx of a number of unorganized players . However, freight forwarders are gaining scale, some more than others, and are wanting to offer other value added services, often asset heavy like CFS/ICD, warehousing, etc. This, together with their need for working capital and create self-owned set-ups abroad, requires them to raise funds creating opportunities for a PE play. It is no wonder that in India the maximum number of M&A activities are centred around freight forwarding companies as overseas logistics companies seek to have greater control of their India corridor and vice versa.
According to Manish Saigal, executive director, KPMG, some of the new trends that are shaping investment opportunities in the sector include the emergence of strong intra-Asia trade in turn strengthening the east coast shipping and ports infrastructure , the need for integrated , multi-modal transport networks with a rail focus and specialization in high-end cargo types such as project logistics focused on power or metro coaches or sports logistics.
"With the government making way for guiding tariff instead of fixing tariff for ports, it will give confidence to the investor community to invest in port projects," opines Ms Seksaria. India, the world's second fastest growing major economy after China, will need $1 trillion (Rs 45.1 trillion) worth of investments in infrastructure over the next five years, according to a recent report by research agency Prequin.
India government's maritime development agenda has geared to bring in sizable private money into sector, which is projected to see developments to the tune of Rs 1 lakh crore during the ongoing National Maritime Development Programme. "The government will, however , have to firm up the policy framework governing private investment in infrastructure," said Ms Seksaria, "if it has to continue to attract private capital both domestic and overseas" .
When asked whether the rising interest regime could spoil the sport, she said, "Project debt financing will become further expensive and while, given the imperative nature of developments , it will not be a major setback to our infrastructure development programme, it gives an additional reason to the policymakers to be sensitive to the cause of the private investor" .
According to Prequin, currently there are 38 overseas infrastructure investors, all of them PE funds, with a preference for assets in India. "Of these, 25 have raised an aggragate $9.5 billion, while the rest are scouting for another $7.3 billion," it had pointed out in its report.
On the PE side, scores of India-focused funds managing over $20 billion are now eager to deploy capital given the recent slowdown. On the M&A side, the country presents itself as an ideal ground where industry consolidation has only just begun . PE firms that have successfully exited last year after amassing a cool $5.4 billion are also giving investors the necessary confidence about the accelerating growth of the economy , fast approaching $2 trillion in size, and its ability to give healthy returns.
There have been over 160 deals in the infrastructure sector in the last five years alone making it one of the most active M&A sectors in India today.
If there is any particular segment that is enjoying good attention of fund managers as well as strategic buyers, it is the freight forwarding industry.
According to Wikipedia, a freight forwarder, forwarder, or forwarding agent is a person or company that organises shipments for individuals or other companies and may also act as a carrier. A forwarder is often not active as a carrier and acts only as an agent, in other words as a third-party (non-assetbased ) logistics provider that dispatches shipments via assetbased carriers and that books or otherwise arranges space for these shipments.
According to Chetan Dikshit, director – Rothschild India, freight forwarding continues to receive a premium as compared to 3PL businesses in the global strategic M&A landscape .
"Unlike the west and the other developed world, India's freight market is dominated by forwarders ," said Gautami Seksaria , founder and partner, Supply Chain Leadership Council, an organization seeking to create an active community of industry stakeholders in the wider transport and logistics sector. "They control customer relationships and play the crucial role of consolidating cargo volumes for carriers ."
With few entry barriers, the freight forwarding sector has traditionally seen an influx of a number of unorganized players . However, freight forwarders are gaining scale, some more than others, and are wanting to offer other value added services, often asset heavy like CFS/ICD, warehousing, etc. This, together with their need for working capital and create self-owned set-ups abroad, requires them to raise funds creating opportunities for a PE play. It is no wonder that in India the maximum number of M&A activities are centred around freight forwarding companies as overseas logistics companies seek to have greater control of their India corridor and vice versa.
According to Manish Saigal, executive director, KPMG, some of the new trends that are shaping investment opportunities in the sector include the emergence of strong intra-Asia trade in turn strengthening the east coast shipping and ports infrastructure , the need for integrated , multi-modal transport networks with a rail focus and specialization in high-end cargo types such as project logistics focused on power or metro coaches or sports logistics.
"With the government making way for guiding tariff instead of fixing tariff for ports, it will give confidence to the investor community to invest in port projects," opines Ms Seksaria. India, the world's second fastest growing major economy after China, will need $1 trillion (Rs 45.1 trillion) worth of investments in infrastructure over the next five years, according to a recent report by research agency Prequin.
India government's maritime development agenda has geared to bring in sizable private money into sector, which is projected to see developments to the tune of Rs 1 lakh crore during the ongoing National Maritime Development Programme. "The government will, however , have to firm up the policy framework governing private investment in infrastructure," said Ms Seksaria, "if it has to continue to attract private capital both domestic and overseas" .
When asked whether the rising interest regime could spoil the sport, she said, "Project debt financing will become further expensive and while, given the imperative nature of developments , it will not be a major setback to our infrastructure development programme, it gives an additional reason to the policymakers to be sensitive to the cause of the private investor" .
According to Prequin, currently there are 38 overseas infrastructure investors, all of them PE funds, with a preference for assets in India. "Of these, 25 have raised an aggragate $9.5 billion, while the rest are scouting for another $7.3 billion," it had pointed out in its report.
Morgan Stanley, Isolux Corsan to invest $400 mn in India JV
Mumbai: Morgan Stanley Infrastructure Partners (MSIP), a $4-billion global infrastructure fund, has committed to invest up to $200 million in a joint venture (JV) with Isolux Corsán Concesiones in India.
Isolux Corsán Concesiones is an infrastructure concessions subsidiary of the $4-billion Grupo Isolux Corsán, specialising in large projects across construction, engineering and concessions.
Grupo Isolux Corsán will bring in an equal amount in the JV, bringing the total commitment to $400 million.
The JV is constructing three highway projects under long-term concession agreements awarded through the build-operate-transfer programme of the National Highways Authority of India (NHAI). The three projects, which totalled over 400 kilometres of road, were estimated to cost over $1.6 billion, said a Morgan Stanley statement. These projects had already received debt financing from leading financial institutions and substantial equity investment from Isolux Corsán, it added.
These projects are expansions of existing roads, and will link major cities, industrial hubs, as well as ports and tourist attractions.
“The JV with Isolux Corsán Concesiones adds to our successful presence in India’s transportation sector, providing us with an excellent road concession platform in a market that is experiencing rapid urbanisation and dramatic growth in vehicles,” said Gautam Bhandari, head of MSI Asia.
The road development programme undertaken by the NHAI under a public-private-partnership (PPP) model is among the largest PPP programmes in the world on Tuesday. NHAI’s National Highway Development Programme, initiated in 1999, is estimated to total $50 billion when completed. India has witnessed double-digit growth in vehicle registrations over the past 10 years, according to Euromonitor, and Morgan Stanley Research identifies it as the second-fastest growing auto market in the world.
Isolux Corsán Concesiones is an infrastructure concessions subsidiary of the $4-billion Grupo Isolux Corsán, specialising in large projects across construction, engineering and concessions.
Grupo Isolux Corsán will bring in an equal amount in the JV, bringing the total commitment to $400 million.
The JV is constructing three highway projects under long-term concession agreements awarded through the build-operate-transfer programme of the National Highways Authority of India (NHAI). The three projects, which totalled over 400 kilometres of road, were estimated to cost over $1.6 billion, said a Morgan Stanley statement. These projects had already received debt financing from leading financial institutions and substantial equity investment from Isolux Corsán, it added.
These projects are expansions of existing roads, and will link major cities, industrial hubs, as well as ports and tourist attractions.
“The JV with Isolux Corsán Concesiones adds to our successful presence in India’s transportation sector, providing us with an excellent road concession platform in a market that is experiencing rapid urbanisation and dramatic growth in vehicles,” said Gautam Bhandari, head of MSI Asia.
The road development programme undertaken by the NHAI under a public-private-partnership (PPP) model is among the largest PPP programmes in the world on Tuesday. NHAI’s National Highway Development Programme, initiated in 1999, is estimated to total $50 billion when completed. India has witnessed double-digit growth in vehicle registrations over the past 10 years, according to Euromonitor, and Morgan Stanley Research identifies it as the second-fastest growing auto market in the world.
Spice Exports Treble in Five Years
Kochi: Spice exports have seen risen three-fold in value terms in the last five years. In quantity terms, the increase would be close to 60% in the period. Exports of spices and spice products stood at 6,030.74 crore during the April-February period of 2010-11.
They were at around 2,100 crore during the April-February period of 2005-06.
Though almost all items in the spice basket have registered a growth during the past five years, the phenomenal rise in chilli, turmeric and cumin and value-added items like curry powder, mint products and spice oils have led to the boom in exports.
"The increase in the value of spice exports is the combined effect of an increase in the prices of major items, a moderate increase in the quantity of exports and higher exports of value-added items," said Philip Kuruvila, former chairman of the All India Spice Exporters Forum.
The dramatic increase was seen in chilli, the exports of which stood at 1,379.51 crore during April-February of 2010-11. In 2005-06, it stood at 362 crore.
They were at around 2,100 crore during the April-February period of 2005-06.
Though almost all items in the spice basket have registered a growth during the past five years, the phenomenal rise in chilli, turmeric and cumin and value-added items like curry powder, mint products and spice oils have led to the boom in exports.
"The increase in the value of spice exports is the combined effect of an increase in the prices of major items, a moderate increase in the quantity of exports and higher exports of value-added items," said Philip Kuruvila, former chairman of the All India Spice Exporters Forum.
The dramatic increase was seen in chilli, the exports of which stood at 1,379.51 crore during April-February of 2010-11. In 2005-06, it stood at 362 crore.
India is at the heart of Accenture operations: CEO Pierre Nanterme
Bangalore: Consulting and technology giant Accenture houses around a third of its employees in India. Speaking exclusively to TOI on a visit to Bangalore on Tuesday, Accenture CEO Pierre Nanterme described India as the heart of Accenture and said the company's employee base in India would be 70,000 by August this year, the highest in any one country. The US has the second largest employee number at around 30,000. Accenture globally has 215,000 people.
The $22-billion Accenture's strength in India shows yet again how critical the country has become to the world's technology giants. IBM does not reveal country figures, but is said to be the second biggest IT employer in India, after TCS. Capgemini has a third of its employee base in India, higher than in its home country France.
"The quality of engineers in India is spectacular. In the West, with an ageing population, there is a significant shortage of people with skills in maths, science and engineering," Nanterme said.
He said India is now at the heart of Accenture's global operations in technology, innovation and industry expertise. India is at the forefront of the company's R&D and innovation in several key industry drivers including cloud computing, analytics and mobility. "We are making huge investments in India to develop our expertise around the new waves of technology that will drive future business," he said.
Nanterme said that the company now focuses on hiring engineers who have deep domain expertise in specific sectors. This enables engineers to understand how a certain technology or application can support functions in specific sectors. It also enables engineers to develop industry specific solutions on top of the existing platforms.
For instance, Accenture has built a banking centre of excellence in India where the company is developing pre-configured solutions for banking customers. Similarly the company has established centres of excellence in around ten key industry verticals.
Asked what he thought of Indian IT companies like Infosys and Wipro, he said they were good companies and Accenture had learned much from them. "One of the things we learnt (from them) was to have 70,000 people in India; and to stay close to them to understand them better," he said. He said it with a laugh, but it did not look like he said it tongue-in-cheek.
The $22-billion Accenture's strength in India shows yet again how critical the country has become to the world's technology giants. IBM does not reveal country figures, but is said to be the second biggest IT employer in India, after TCS. Capgemini has a third of its employee base in India, higher than in its home country France.
"The quality of engineers in India is spectacular. In the West, with an ageing population, there is a significant shortage of people with skills in maths, science and engineering," Nanterme said.
He said India is now at the heart of Accenture's global operations in technology, innovation and industry expertise. India is at the forefront of the company's R&D and innovation in several key industry drivers including cloud computing, analytics and mobility. "We are making huge investments in India to develop our expertise around the new waves of technology that will drive future business," he said.
Nanterme said that the company now focuses on hiring engineers who have deep domain expertise in specific sectors. This enables engineers to understand how a certain technology or application can support functions in specific sectors. It also enables engineers to develop industry specific solutions on top of the existing platforms.
For instance, Accenture has built a banking centre of excellence in India where the company is developing pre-configured solutions for banking customers. Similarly the company has established centres of excellence in around ten key industry verticals.
Asked what he thought of Indian IT companies like Infosys and Wipro, he said they were good companies and Accenture had learned much from them. "One of the things we learnt (from them) was to have 70,000 people in India; and to stay close to them to understand them better," he said. He said it with a laugh, but it did not look like he said it tongue-in-cheek.
India beats China in internet contribution to GDP
New Delhi: Internet is changing our lives, the way we work, shop, search for information, communicate, and meet people. Two billion people are now connected to the internet, and this number is growing by 200 million a year. But the magnitude of the economic impact of internet-related activities is not obvious.
A new McKinsey study finds that the internet has delivered significant economic growth, created swathes of jobs and created wealth.
Using an approach based on internet-enabled consumption patterns by individuals, businesses, and governments, the study finds that the internet contributes more to GDP than agriculture, energy, and several other traditional sectors do in many countries.
In India , the internet contributed 5% to GDP growth in the past 5 years compared with the average 3% for Bric economies, says the study.
Here is how internet contributes to growth:
Companies are able to keep costs down, target customers better and bring goods and services to markets around the world much more easily.
Individuals are able to compare prices, search hard-to-find items or information, communicate and learn in new, improved ways.
Governments can serve citizens much more quickly and at a much lower cost through e-governance.
A new McKinsey study finds that the internet has delivered significant economic growth, created swathes of jobs and created wealth.
Using an approach based on internet-enabled consumption patterns by individuals, businesses, and governments, the study finds that the internet contributes more to GDP than agriculture, energy, and several other traditional sectors do in many countries.
In India , the internet contributed 5% to GDP growth in the past 5 years compared with the average 3% for Bric economies, says the study.
Here is how internet contributes to growth:
Companies are able to keep costs down, target customers better and bring goods and services to markets around the world much more easily.
Individuals are able to compare prices, search hard-to-find items or information, communicate and learn in new, improved ways.
Governments can serve citizens much more quickly and at a much lower cost through e-governance.
India-Africa ties get stronger
New Delhi: The Ethiopian Government has offered a substantial share of its 3 million-hectare farm land to Indian entrepreneurs. This was declared by Meles Zenawi, Prime Minister of Ethiopia, at a press conference in Addis Ababa.
The Prime Minister of Ethiopia said that this will bring capital, technology, infrastructure and jobs to the rural areas of the country. This offer is expected to increase the quantum of trade between the two countries and the Indian presence would add value to Ethiopian products. "India has promised to invest in the textile sector and this would hugely help our local industry," said the Ethiopian Prime Minister. Indian investors have already committed US$ 4.7 billion investment in the farm sector of Ethiopia.
Moreover, the Prime Minister of India, Dr Manmohan Singh, has said at the 2nd Africa-India Forum Summit that, “We should encourage trade and investment flows as well as transfer of technology. Private sector should be fully involved in the efforts to integrate our economies.”
The Indian Government is also looking to unveil a new policy to promote Indian companies in the International markets.
The Prime Minister of Ethiopia said that this will bring capital, technology, infrastructure and jobs to the rural areas of the country. This offer is expected to increase the quantum of trade between the two countries and the Indian presence would add value to Ethiopian products. "India has promised to invest in the textile sector and this would hugely help our local industry," said the Ethiopian Prime Minister. Indian investors have already committed US$ 4.7 billion investment in the farm sector of Ethiopia.
Moreover, the Prime Minister of India, Dr Manmohan Singh, has said at the 2nd Africa-India Forum Summit that, “We should encourage trade and investment flows as well as transfer of technology. Private sector should be fully involved in the efforts to integrate our economies.”
The Indian Government is also looking to unveil a new policy to promote Indian companies in the International markets.
Advanced GSAT-8 satellite launched successfully
Bengaluru: India's advanced communication satellite, GSAT-8, was successfully launched at 2:08 am (IST) today by the Ariane-V launch vehicle of Arianespace from Kourou, French Guiana, in South America. Ariane V placed the GSAT-8 into the intended Geosynchronous Transfer Orbit (GTO) of 35,861 km apogee and 258 km perigee.
Isro’s Master Control Facility (MCF) at Hassan in Karnataka acquired the signals from GSAT-8 satellite immediately after the injection, according to a statement from Isro. Initial checks on the satellite have indicated normal health of the satellite.
“Preparations are underway for the firing of 440 Newton Liquid Apogee Motor (LAM) during the third orbit of the satellite on May 22, at 3:58 am (IST) as a first step towards taking the satellite to its geostationary orbital home,” the statement added.
The GSAT-8 will improve direct to home TV broadcast services. Weighing about 3100 Kg at lift-off, GSAT-8 is configured to carry 24 high power transponders in Ku-band and a two-channel GPS Aided Geo Augmented Navigation (GAGAN) payload operating in L1 and L5 bands.
The 24 Ku band transponders will augment the capacity in the Insat system. The GAGAN payload provides the Satellite Based Augmentation System (SBAS), through which the accuracy of the positioning information obtained from the GPS Satellite is improved by a network of ground based receivers and made available to the users in the country through the geostationary satellites.
Prime Minister Manmohan Singh has applauded the efforts of the Department of Space for the successful launch of advanced communication satellite GSAT-8 for improving in an elliptical geo-synchronous transfer orbit early Saturday by the Ariane-VA-202 rocket.
Within minutes, the space agency’s master control facility (MCF) at Hassan, about 180 km from Bangalore, identified the presence of GSAT-8 in the geo-synchronous transfer orbit (GTO).
Responding to the news, the official Isro spokesperson claimed MCF will conduct a test to track the health parameters of the payloads by June 1 so that it will be accessed by DTH services from July 1
Isro’s Master Control Facility (MCF) at Hassan in Karnataka acquired the signals from GSAT-8 satellite immediately after the injection, according to a statement from Isro. Initial checks on the satellite have indicated normal health of the satellite.
“Preparations are underway for the firing of 440 Newton Liquid Apogee Motor (LAM) during the third orbit of the satellite on May 22, at 3:58 am (IST) as a first step towards taking the satellite to its geostationary orbital home,” the statement added.
The GSAT-8 will improve direct to home TV broadcast services. Weighing about 3100 Kg at lift-off, GSAT-8 is configured to carry 24 high power transponders in Ku-band and a two-channel GPS Aided Geo Augmented Navigation (GAGAN) payload operating in L1 and L5 bands.
The 24 Ku band transponders will augment the capacity in the Insat system. The GAGAN payload provides the Satellite Based Augmentation System (SBAS), through which the accuracy of the positioning information obtained from the GPS Satellite is improved by a network of ground based receivers and made available to the users in the country through the geostationary satellites.
Prime Minister Manmohan Singh has applauded the efforts of the Department of Space for the successful launch of advanced communication satellite GSAT-8 for improving in an elliptical geo-synchronous transfer orbit early Saturday by the Ariane-VA-202 rocket.
Within minutes, the space agency’s master control facility (MCF) at Hassan, about 180 km from Bangalore, identified the presence of GSAT-8 in the geo-synchronous transfer orbit (GTO).
Responding to the news, the official Isro spokesperson claimed MCF will conduct a test to track the health parameters of the payloads by June 1 so that it will be accessed by DTH services from July 1
IandB ministry okay with 74% FDI ceiling for DTH, IPTV
New Delhi: The information and broadcasting ministry endorsed the recommendation by the Telecom Regulatory Authority of India (Trai) to enhance foreign direct investment (FDI) ceiling for direct to home TV, Internet protocol TV and teleport from 49% to 74%.
However, it rejected recommendation to reduce the FDI ceiling for local cable operators from 49% to 26%, arguing that the limit had been 49% since 1995. "The nature of control as per the provisions of the Company Law would also not undergo any change since the power to initiate a special resolution remains the same at 26% or at 49%. The ministry is of the view that not much purpose would be served by reducing the FDI limit and, therefore, 49% FDI may be retained for the LCOs," the ministry said in its draft note, which has now been sent back to Trai for consideration.
On the recommendations on FDI cap for uplinking of non-news and current affairs TV channels and downlinking of TV channels uplinked from abroad and in news channels and FM, radio, the I&B ministry agreed with views of Trai under those heads.
There is no restriction on foreign ownership of non-news and current affairs TV channels and downlinking TV channels uplinked from foreign countries. The Trai had favoured status-quo. There is a cap of 26% on FDI flow in news and current affairs TV channels and FM radio, and Trai wanted the limit to remain untouched.
The major change that could be in the offing is in the services offered by the various carriage services. While platforms such as HITS and mobile TV are allowed to invite FDI up to 74%, a parity is now being sought to be restored by allowing DTH , Teleport and IPTV operators also to attract the same level of foreign investment.
"The ministry may broadly agree with the recommendations that a limit of 74% for foreign investment for the broadcast carriage services such as DTH, IPTV, Mobile TV, HITS and Teleport may be set. This will bring uniformity in the FDI ceiling in carriage services. The rationale brought out by Trai for reaching the 74% limit is justified in view of the burgeoning growth of the sector, which requires huge investment and also in view of the convergences of technologies," the note said.
However, it rejected recommendation to reduce the FDI ceiling for local cable operators from 49% to 26%, arguing that the limit had been 49% since 1995. "The nature of control as per the provisions of the Company Law would also not undergo any change since the power to initiate a special resolution remains the same at 26% or at 49%. The ministry is of the view that not much purpose would be served by reducing the FDI limit and, therefore, 49% FDI may be retained for the LCOs," the ministry said in its draft note, which has now been sent back to Trai for consideration.
On the recommendations on FDI cap for uplinking of non-news and current affairs TV channels and downlinking of TV channels uplinked from abroad and in news channels and FM, radio, the I&B ministry agreed with views of Trai under those heads.
There is no restriction on foreign ownership of non-news and current affairs TV channels and downlinking TV channels uplinked from foreign countries. The Trai had favoured status-quo. There is a cap of 26% on FDI flow in news and current affairs TV channels and FM radio, and Trai wanted the limit to remain untouched.
The major change that could be in the offing is in the services offered by the various carriage services. While platforms such as HITS and mobile TV are allowed to invite FDI up to 74%, a parity is now being sought to be restored by allowing DTH , Teleport and IPTV operators also to attract the same level of foreign investment.
"The ministry may broadly agree with the recommendations that a limit of 74% for foreign investment for the broadcast carriage services such as DTH, IPTV, Mobile TV, HITS and Teleport may be set. This will bring uniformity in the FDI ceiling in carriage services. The rationale brought out by Trai for reaching the 74% limit is justified in view of the burgeoning growth of the sector, which requires huge investment and also in view of the convergences of technologies," the note said.
Rockwool sets up greenfield plant in Dahej
Mumbai/Ahmedabad: New unit to produce stone wool for insulation applications.
One of the largest producers of stone wool for insulation applications, Rockwool has set up a greenfield plant in Dahej, Gujarat. With an ability to save one billion tonnes of carbon dioxide (CO2) a year, the plant has a capacity to produce 30,000 tonnes per annum.
Talking about the new plant in Gujarat, Ian Russell, business unit director export and the UK, Rockwool Technical Insulation said, "Rockwool stone wool products reach all parts of the globe. Whilst Europe is still the strongest region in our operations, important sales and production activities in Asia – and especially in India - are growing significantly every year.
He added, “Moreover, this new plant opens opportunities for export to the Emirates and Saudi Arabia, which are also big markets for technical insulation."
Employing around 200 persons at full capacity, the new factory will produce a wide range of high quality stone wool insulation products for the insulation of industrial plants and buildings. Each of these products is developed for their specific application and offer exceptional/unrivalled thermal, fire protection, acoustic and sustainable performance.
"We see India as a high potential market, as industry is well aware of the need to lower both costs and environmental impact by saving energy and reducing CO2 emissions. This new plant will enable us to better serve our customers in the Indian Subcontinent. Through our Rockwool sales office in Mumbai, which we opened in 2010, we are now able to offer our customers efficient and cost-effective solutions for all their insulation needs," said Samson Suresh, General Manager - Sales, Rockwool.
Effective insulation in building and construction and in industry can save literally millions of tonnes of CO2, helping to protect the environment, whilst at the same time saving operators millions of rupees. Investing in insulation can be extremely profitable, with annual returns on investment reaching 100%.
Rockwool has installed insulation for technical installations around the world in one year that will save nearly 4,000 million tonnes of CO2 in its lifetime.
Part of the Rockwool Group, the Rockwool Technical Insulation (RTI) is a leading supplier of high quality stone wool products that provide solutions which insulate and protect technical installations in the process industry and marine and offshore.
One of the largest producers of stone wool for insulation applications, Rockwool has set up a greenfield plant in Dahej, Gujarat. With an ability to save one billion tonnes of carbon dioxide (CO2) a year, the plant has a capacity to produce 30,000 tonnes per annum.
Talking about the new plant in Gujarat, Ian Russell, business unit director export and the UK, Rockwool Technical Insulation said, "Rockwool stone wool products reach all parts of the globe. Whilst Europe is still the strongest region in our operations, important sales and production activities in Asia – and especially in India - are growing significantly every year.
He added, “Moreover, this new plant opens opportunities for export to the Emirates and Saudi Arabia, which are also big markets for technical insulation."
Employing around 200 persons at full capacity, the new factory will produce a wide range of high quality stone wool insulation products for the insulation of industrial plants and buildings. Each of these products is developed for their specific application and offer exceptional/unrivalled thermal, fire protection, acoustic and sustainable performance.
"We see India as a high potential market, as industry is well aware of the need to lower both costs and environmental impact by saving energy and reducing CO2 emissions. This new plant will enable us to better serve our customers in the Indian Subcontinent. Through our Rockwool sales office in Mumbai, which we opened in 2010, we are now able to offer our customers efficient and cost-effective solutions for all their insulation needs," said Samson Suresh, General Manager - Sales, Rockwool.
Effective insulation in building and construction and in industry can save literally millions of tonnes of CO2, helping to protect the environment, whilst at the same time saving operators millions of rupees. Investing in insulation can be extremely profitable, with annual returns on investment reaching 100%.
Rockwool has installed insulation for technical installations around the world in one year that will save nearly 4,000 million tonnes of CO2 in its lifetime.
Part of the Rockwool Group, the Rockwool Technical Insulation (RTI) is a leading supplier of high quality stone wool products that provide solutions which insulate and protect technical installations in the process industry and marine and offshore.
Alta-Xintong offers DC solar power for telecom towers
Chennai: Alta-Xintong Solar Tech Pvt Ltd, a joint venture between Bangalore-based Alta Energy Technologies Pvt Ltd and Chinese solar system solution provider XinTong, has launched DC solar power systems for power telecom towers in India. The company has tied up with an international financial institution to finance deployment of solar power systems.
The system would support the operators to run their new towers through solar power, reducing dependency on diesel powered systems which are currently under use, said E M Abdul Manaf, managing director, Alta Energy Technologies Pvt Ltd. The company is expecting to sell around 2,000 solar power systems by end of 2011, he added.
"We are in advanced stages of finalising 2,000 solar power systems for leading tower companies in India under the zero investment plan. We are in talks with major tower operators like Indus and GTL to provide the new system for their upcoming projects and shifting some of the existing towers from diesel system to solar system," he added.
Around 30,000 towers out of the total 300,000 telecom sites in the country are in off-grid rural locations, where it is run round the clock on diesel power. Besides, estimates are that around 36,000 sites are expected to come up in every year in India, with a market value of $ 2.16 billion.
The company has entered into tie-up with an international financial institution to provide an investment plan to the tower operators, zero investment plan. Under the plan, the financial institution would provide loan for investment, through which the tower operators could avail the system without making up-front investment.
Alta holds 65 per cent and XinTong holds 35 per cent of shares in the joint venture firm.
The system would support the operators to run their new towers through solar power, reducing dependency on diesel powered systems which are currently under use, said E M Abdul Manaf, managing director, Alta Energy Technologies Pvt Ltd. The company is expecting to sell around 2,000 solar power systems by end of 2011, he added.
"We are in advanced stages of finalising 2,000 solar power systems for leading tower companies in India under the zero investment plan. We are in talks with major tower operators like Indus and GTL to provide the new system for their upcoming projects and shifting some of the existing towers from diesel system to solar system," he added.
Around 30,000 towers out of the total 300,000 telecom sites in the country are in off-grid rural locations, where it is run round the clock on diesel power. Besides, estimates are that around 36,000 sites are expected to come up in every year in India, with a market value of $ 2.16 billion.
The company has entered into tie-up with an international financial institution to provide an investment plan to the tower operators, zero investment plan. Under the plan, the financial institution would provide loan for investment, through which the tower operators could avail the system without making up-front investment.
Alta holds 65 per cent and XinTong holds 35 per cent of shares in the joint venture firm.
IBM draws up 5-year India roadmap
Bangalore: Big Blue is turning 100 on June 16. As part of its centenary celebration, IBM in India has drawn up a five-year roadmap with a focus on emerging markets, business analytics, cloud computing and smarter planet.
IBM India managing director Shanker Annaswamy said the company services 700 large global clients from India. "The domestic market itself is very important for us. Telecom sector will be the main focus area for us, while banking, financial services, infrastructure, enterprise data warehousing and cloud computing will other spaces of importance for us in India."
In India, IBM is the largest IT services provider. Some 70% of its Indian revenues come from services and the rest from hardware. The company's BRIC region (Brazil, Russia, India and China) revenues grew by 19% during calendar 2010.
Annaswamy said, over its century of existence IBM has played a leading role in transforming business, science and society. Reinvesting modern corporation, pioneering the science of information and making the world work better will be the theme areas for IBM.
Since its reentry into India in 1992, IBM has been instrumental in enabling transformation across major industries including telecommunication, financial services, automotive, infrastructure, healthcare, government and education.
IBM will bring out a centennial book recording the history of the company and three journalists including Kevin Maney, Steve Hanm and Jeffrey M O'Brian are editing the book.
IBM India managing director Shanker Annaswamy said the company services 700 large global clients from India. "The domestic market itself is very important for us. Telecom sector will be the main focus area for us, while banking, financial services, infrastructure, enterprise data warehousing and cloud computing will other spaces of importance for us in India."
In India, IBM is the largest IT services provider. Some 70% of its Indian revenues come from services and the rest from hardware. The company's BRIC region (Brazil, Russia, India and China) revenues grew by 19% during calendar 2010.
Annaswamy said, over its century of existence IBM has played a leading role in transforming business, science and society. Reinvesting modern corporation, pioneering the science of information and making the world work better will be the theme areas for IBM.
Since its reentry into India in 1992, IBM has been instrumental in enabling transformation across major industries including telecommunication, financial services, automotive, infrastructure, healthcare, government and education.
IBM will bring out a centennial book recording the history of the company and three journalists including Kevin Maney, Steve Hanm and Jeffrey M O'Brian are editing the book.
Renault to up parts sourcing from India
Chennai: French carmaker Renault will source 80 million euros worth components this year from India to feed its overseas plants. The company sourced 35 million Euro worth parts last year.
Renault is gearing up for its re-entry after severing ties with Mahindra & Mahindra. The first car will be its sedan Fluence which will be assembled at the company's plant in Oragadam, Chennai. The plant is set up in alliance with Nissan with a capacity to produce 4 lakh cars a year.
"Increased sourcing of parts for our global operations demonstrates our determination to make India the hub for our activities in this region," Sudhir Rao, deputy managing director, Renault India, said. The company had announced plans to launch five cars over the next 18 months. "We will now launch five new models in the Indian market over the next 15 months instead of 18 months," Rao said. The company, he said, will have cars in every segment in 15 months.
Terming the Indian market as a challenge, Rao said Renault's success in India was crucial. "India entry is a litmus test for success. Only if we succeed here, some other markets will open up for Renault. It is a huge challenge," Rao said.
The company hopes to have 14 dealer outlets across 12 cities by June 2011 which will increase to 40 outlets by December. In the third phase the dealer footprint will increase to 100 outlets.
Component sourcing by Renault's alliance partner Nissan from India for its worldwide operations is also gaining momentum. The company had envisaged $10 million worth components to be sourced from Indian vendors for its plants Thailand, China, Japan and the UK. "For the last year we sourced components worth $40 million. For the current fiscal (ending March 2012), we will source $100 million worth parts," Kiminobu Tokuyama, MD of Nissan India, said.
Renault is gearing up for its re-entry after severing ties with Mahindra & Mahindra. The first car will be its sedan Fluence which will be assembled at the company's plant in Oragadam, Chennai. The plant is set up in alliance with Nissan with a capacity to produce 4 lakh cars a year.
"Increased sourcing of parts for our global operations demonstrates our determination to make India the hub for our activities in this region," Sudhir Rao, deputy managing director, Renault India, said. The company had announced plans to launch five cars over the next 18 months. "We will now launch five new models in the Indian market over the next 15 months instead of 18 months," Rao said. The company, he said, will have cars in every segment in 15 months.
Terming the Indian market as a challenge, Rao said Renault's success in India was crucial. "India entry is a litmus test for success. Only if we succeed here, some other markets will open up for Renault. It is a huge challenge," Rao said.
The company hopes to have 14 dealer outlets across 12 cities by June 2011 which will increase to 40 outlets by December. In the third phase the dealer footprint will increase to 100 outlets.
Component sourcing by Renault's alliance partner Nissan from India for its worldwide operations is also gaining momentum. The company had envisaged $10 million worth components to be sourced from Indian vendors for its plants Thailand, China, Japan and the UK. "For the last year we sourced components worth $40 million. For the current fiscal (ending March 2012), we will source $100 million worth parts," Kiminobu Tokuyama, MD of Nissan India, said.
iGate completes Patni acquisition
Reconstitutes Patni board; retains 4 senior executives in the executive council; iGate Patni to be the new brand identity.
Marking the biggest acquisition of the India information technology (IT) industry, Nasdaq-listed iGate on Thfursday announced the completion of Patni Computer Systems’ acquisition and revamping of the top leadership. The combined entity will be known as iGate Patni.
While Phaneesh Murthy, the iGate CEO, has been made the MD and CEO of the combined entity, he will work with an eight-member executive council. This has equal representation from the old Patni team and iGate. With this, iGate’s total holding in Patni hit 82.5 per cent.
At the board level, Narendra Patni, the founder and chairman of Patni, made way for Jai Pathak. The board will also have Shashank Singh, co-head of Apax India, and Göran Lindahl, member of the iGate board, as the new directors with existing members Vimal Bhandari and Arun Duggal continuing as independent directors.
Former CEO of Patni, Jeya Kumar, has stepped down to pave way for Murthy who will take over the position with immediate effect.
The new management of iGate said both companies will continue as listed entities in their respective exchanges while the market-facing activity will be done by a single brand to be known as iGate Patni. Murthy said he was not in favour of a family name as part of the company name, but for the time being Patni will be part of the brand as it will act as a bridge between clients.
The four members of the old iGate team, who have been retained are Sunil Chitale, Satish Joshi, Derek Kemp and Vijay Khare. iGate senior executives who are part of the new executive council of the merged entity are Sujit Sircar, Sean Narayanan, David Kruzner and Robert Massie.
Murthy said the company brought down the leadership team of the merged entity from 22 to nine people to make it more focused. “The departure of some senior executives of Patni is largely motivated by us. They have been well compensated as per their contractual obligation with the earlier Patni management. We are known as one of the best employers and always value our people. So, the retrenchment will remain confined to the senior management level,” he said.
The combined entity will now have 26,000 employees with a client base of 360. The merged entity will have a two $100 million (annual revenue generating) clients and two $50 million clients other than 36 clients who fetch a revenue of $5 million per annum.
With this, the top five clients will contribute 38 per cent of the total turnover while the top 10 customers will account for 49 per cent. “We believe there is a number of cross-selling opportunities across the 360 clients of iGate and Patni, and will focus on improving service levels depending upon our engagement with existing clients. The initial feedback of the customers is very encouraging. In the next two to three years, our goal is to become the leader by capability in two verticals (banking and financial services and insurance) and a significant player in at least three to four other verticals,” said Murthy.
In the long run, the new management favours a primary US listing but for that it will have to buy out the minority shareholders.
iGate entered into an agreement to acquire majority stake in Patni in January. The transaction marks the completion with the buyout of the principal stakeholders, Narendra Patni, Ashok Patni, Gajendra Patni and General Atlantic, and the 20 per cent mandatory tender offer to the public shareholder. On April 27, iGate concluded the open offer which was fully subscribed, giving iGate a majority stake in Patni Computer Systems of about 83 per cent.
Marking the biggest acquisition of the India information technology (IT) industry, Nasdaq-listed iGate on Thfursday announced the completion of Patni Computer Systems’ acquisition and revamping of the top leadership. The combined entity will be known as iGate Patni.
While Phaneesh Murthy, the iGate CEO, has been made the MD and CEO of the combined entity, he will work with an eight-member executive council. This has equal representation from the old Patni team and iGate. With this, iGate’s total holding in Patni hit 82.5 per cent.
At the board level, Narendra Patni, the founder and chairman of Patni, made way for Jai Pathak. The board will also have Shashank Singh, co-head of Apax India, and Göran Lindahl, member of the iGate board, as the new directors with existing members Vimal Bhandari and Arun Duggal continuing as independent directors.
Former CEO of Patni, Jeya Kumar, has stepped down to pave way for Murthy who will take over the position with immediate effect.
The new management of iGate said both companies will continue as listed entities in their respective exchanges while the market-facing activity will be done by a single brand to be known as iGate Patni. Murthy said he was not in favour of a family name as part of the company name, but for the time being Patni will be part of the brand as it will act as a bridge between clients.
The four members of the old iGate team, who have been retained are Sunil Chitale, Satish Joshi, Derek Kemp and Vijay Khare. iGate senior executives who are part of the new executive council of the merged entity are Sujit Sircar, Sean Narayanan, David Kruzner and Robert Massie.
Murthy said the company brought down the leadership team of the merged entity from 22 to nine people to make it more focused. “The departure of some senior executives of Patni is largely motivated by us. They have been well compensated as per their contractual obligation with the earlier Patni management. We are known as one of the best employers and always value our people. So, the retrenchment will remain confined to the senior management level,” he said.
The combined entity will now have 26,000 employees with a client base of 360. The merged entity will have a two $100 million (annual revenue generating) clients and two $50 million clients other than 36 clients who fetch a revenue of $5 million per annum.
With this, the top five clients will contribute 38 per cent of the total turnover while the top 10 customers will account for 49 per cent. “We believe there is a number of cross-selling opportunities across the 360 clients of iGate and Patni, and will focus on improving service levels depending upon our engagement with existing clients. The initial feedback of the customers is very encouraging. In the next two to three years, our goal is to become the leader by capability in two verticals (banking and financial services and insurance) and a significant player in at least three to four other verticals,” said Murthy.
In the long run, the new management favours a primary US listing but for that it will have to buy out the minority shareholders.
iGate entered into an agreement to acquire majority stake in Patni in January. The transaction marks the completion with the buyout of the principal stakeholders, Narendra Patni, Ashok Patni, Gajendra Patni and General Atlantic, and the 20 per cent mandatory tender offer to the public shareholder. On April 27, iGate concluded the open offer which was fully subscribed, giving iGate a majority stake in Patni Computer Systems of about 83 per cent.
Wipro buys 80% stake in Brazilian cylinder maker
Bengalore: Wipro Limited has signed a definite agreement to acquire an 80 per cent stake in Brazilian hydraulic cylinder manufacturer RKM Equipamentos Hidráulicos for an undisclosed amount.
According to the agreement, Wipro will acquire the remaining stake over the next three years. RKM would be a part of Wipro’s infrastructure engineering division.
The Bangalore-headquartered company said the acquisition was expected to be completed during this quarter, subject to customary regulatory approvals.
RKM, one of the top four manufacturers of hydraulic cylinders in Brazil, has one plant near Sao Paulo, the capital of Brazil.
The company, which counts global automobile companies and equipment manufacturers like Volvo, AGCO Corporation and CNH Global among its clients, employs 200 people.
Apart from giving a manufacturing base, the acquisition will also mark the entry of Wipro’s infrastructure engineering division into the Brazilian market.
“Brazil is an extremely attractive market for us which is seeing huge investments in infrastructure space, driven by a high-growth economy. The acquisition will provide us an ideal platform to expand our offerings in the Brazilian market and the rest of the Latin America,” said Pratik Kumar, president, Wipro Infrastructure Engineering.
Wipro Infrastructure Engineering, which accounts for less than four per cent of the company’s overall revenues, has three manufacturing facilities in Europe and four in Sweden. It has three manufacturing plants in India and one each in Finland and China. The China plant is expected to be operational this month.
It is a Tier-1 supplier to global original equipment manufacturers of construction and earth moving machinery, material handling equipment, forestry equipment, heavy and medium commercial vehicles.
According to the agreement, Wipro will acquire the remaining stake over the next three years. RKM would be a part of Wipro’s infrastructure engineering division.
The Bangalore-headquartered company said the acquisition was expected to be completed during this quarter, subject to customary regulatory approvals.
RKM, one of the top four manufacturers of hydraulic cylinders in Brazil, has one plant near Sao Paulo, the capital of Brazil.
The company, which counts global automobile companies and equipment manufacturers like Volvo, AGCO Corporation and CNH Global among its clients, employs 200 people.
Apart from giving a manufacturing base, the acquisition will also mark the entry of Wipro’s infrastructure engineering division into the Brazilian market.
“Brazil is an extremely attractive market for us which is seeing huge investments in infrastructure space, driven by a high-growth economy. The acquisition will provide us an ideal platform to expand our offerings in the Brazilian market and the rest of the Latin America,” said Pratik Kumar, president, Wipro Infrastructure Engineering.
Wipro Infrastructure Engineering, which accounts for less than four per cent of the company’s overall revenues, has three manufacturing facilities in Europe and four in Sweden. It has three manufacturing plants in India and one each in Finland and China. The China plant is expected to be operational this month.
It is a Tier-1 supplier to global original equipment manufacturers of construction and earth moving machinery, material handling equipment, forestry equipment, heavy and medium commercial vehicles.
Himachal clears 8 industrial projects worth Rs 1,244 cr
New Delhi/Shimla: The Himachal Pradesh government today granted clearance to eight additional new industrial proposals, besides one expansion proposal. All these entail a total investment of Rs 1,244 crore, including a Rs 630-crore plant by Micromax Energy Ltd.
The state’s single window clearance and monitoring authority met under the chairmanship of Chief Minister P K Dhumal here.
The proposals are that of M/S Micromax Energy Limited,carrying an investment of Rs 630 crore and will manufacture solar energy cells.
M/S Cipla Limited, with a Rs 270-crore investment to manufacture pharmaceutical and herbal medicines.
M/S Shivalik Bimetal Controls to invest over Rs 20 crore will make bonded clad strips.While M/S Sun Juice will invest over Rs 51 crore and will set up juice and milk processing and packaging units. All these units are expected to generate 1,860 jobs.
Dhumal said despite the withdrawl of the special industrial package by the Centre, the industrial sector continues to expand rapidly and more investors are showing interest in investing in the state.
The state’s single window clearance and monitoring authority met under the chairmanship of Chief Minister P K Dhumal here.
The proposals are that of M/S Micromax Energy Limited,carrying an investment of Rs 630 crore and will manufacture solar energy cells.
M/S Cipla Limited, with a Rs 270-crore investment to manufacture pharmaceutical and herbal medicines.
M/S Shivalik Bimetal Controls to invest over Rs 20 crore will make bonded clad strips.While M/S Sun Juice will invest over Rs 51 crore and will set up juice and milk processing and packaging units. All these units are expected to generate 1,860 jobs.
Dhumal said despite the withdrawl of the special industrial package by the Centre, the industrial sector continues to expand rapidly and more investors are showing interest in investing in the state.
Branded garments in for more relaxations
Mumbai: The government proposes some more relaxations for the branded garments sector, besides enhancement of duty abatement from 40 per cent to 55 per cent.
One of the major relaxations proposed for the sector is exemption to job workers who work for brand owners in India. This category may not be required to pay 10 per cent excise duty, which the government imposed on branded garments in the Union Budget 2011-12.
Second, branded school and corporate uniforms and materials may also be exempted from excise duty. “This means any branded uniform or blankets, quilts, etc for schools, colleges, hotels, airlines or for any other industry is likely to be exempted from payment of excise duty,” explained an official source.
Third, documentation and procedures for availing exemption from excise duty for small-scale industries may be simplified. Sources said excise officials might not inspect documents. Rather, mere certification from a chartered accountant or documents submitted for value added tax (VAT) and VAT credit would be sufficient to claim excise exemption.
The finance ministry had imposed 10 per cent excise duty on branded garments in the last Budget but later decided to enhance the cut-off limit of industries for excise payment. This was done by increasing the turnover limit eligible for seeking exemption by allowing duty abatement from 40 per cent to 55 per cent but only for 2011-12. With this relief, a unit would be eligible for SSI exemption in 2011-12 even if it had a turnover based on retail sale of Rs 8.9 crore in 2010-11.
Besides excise duty imposition, the sector, however, received a slew of benefits, from reduction of custom duty on various chemicals used for manufacturing of synthetic textile to reduction of excise duty on textile machinery. Also, basic customs duty on raw silk of all grades had been cut from 30 per cent to five per cent and specific tariff rate of 10 per cent had been prescribed for jute yarn, while it was exempted from excise duty. Textile items have been exempt from additional duties of excise under the Goods of Special Importance Act, 1957.
For raw silk , the ministry has also reduced the basic custom duty from 30 per cent to five per cent ad valorem, for augmenting domestic availability for weavers, both in the handloom and the power loom segments.
In raw silk, the government is also keeping a close watch on import volumes and domestic prices, to take steps in mitigating any adverse impact on the domestic sericulture sector.
One of the major relaxations proposed for the sector is exemption to job workers who work for brand owners in India. This category may not be required to pay 10 per cent excise duty, which the government imposed on branded garments in the Union Budget 2011-12.
Second, branded school and corporate uniforms and materials may also be exempted from excise duty. “This means any branded uniform or blankets, quilts, etc for schools, colleges, hotels, airlines or for any other industry is likely to be exempted from payment of excise duty,” explained an official source.
Third, documentation and procedures for availing exemption from excise duty for small-scale industries may be simplified. Sources said excise officials might not inspect documents. Rather, mere certification from a chartered accountant or documents submitted for value added tax (VAT) and VAT credit would be sufficient to claim excise exemption.
The finance ministry had imposed 10 per cent excise duty on branded garments in the last Budget but later decided to enhance the cut-off limit of industries for excise payment. This was done by increasing the turnover limit eligible for seeking exemption by allowing duty abatement from 40 per cent to 55 per cent but only for 2011-12. With this relief, a unit would be eligible for SSI exemption in 2011-12 even if it had a turnover based on retail sale of Rs 8.9 crore in 2010-11.
Besides excise duty imposition, the sector, however, received a slew of benefits, from reduction of custom duty on various chemicals used for manufacturing of synthetic textile to reduction of excise duty on textile machinery. Also, basic customs duty on raw silk of all grades had been cut from 30 per cent to five per cent and specific tariff rate of 10 per cent had been prescribed for jute yarn, while it was exempted from excise duty. Textile items have been exempt from additional duties of excise under the Goods of Special Importance Act, 1957.
For raw silk , the ministry has also reduced the basic custom duty from 30 per cent to five per cent ad valorem, for augmenting domestic availability for weavers, both in the handloom and the power loom segments.
In raw silk, the government is also keeping a close watch on import volumes and domestic prices, to take steps in mitigating any adverse impact on the domestic sericulture sector.
ISRO to launch French satellite in 2012
Kolkata/ Bhubaneswar: Continuing its programme of commercial launch of foreign satellites, Indian Space Research Organisation (ISRO) has lined up launch of an image capturing satellite of France next year, according to Parivakkam Subramaniam Veeraraghavan, director, Vikram Sarabhai Space Centre (VSSC), a unit of ISRO.
“Because of our cost effective technology, many developed nations, including France and the US are willing to launch their satellites with our system. Many smaller and mini satellite launching programmes on commercial basis are in offing,” Veeraraghavan said while attending the National Technology Day seminar organised by National Aluminum Company (Nalco) here yesterday.
The French satellite SPOT (Satellite Pour l'observation de la Terre) is a high-resolution, optical imaging, earth observation satellite system. Currently SPOT 5 is working in the space and is expected to be withdrawn by the end of 2013. India will launch the SPOT 6 satellite, which will provide continuous high definition images of earth.
Due to the cost effectiveness of India-made PSLV (Polar Satellite Launch Vehicle) and GSLV (Geosynchronous Satellite Launch Vehicles), many countries prefer India to launch their satellites. Recently ISRO successfully placed Singapore's first experimental satellite in space. India has so far launched 27 foreign satellites and 60 India-made satellites.
Currently, it costs $25,000 per kg to launch a satellite. The satellites can weigh 500 to 5,000 kg. Sometimes mini-satellites weighing 15-20 kg are bundled with the rocket and are placed in desired orbits.
However, profit realisation from satellite launch is currently lower because of high cost of fuel and one-time use of the rockets. Veeraraghvan said, ISRO is working on a project to develop reusable satellite launcher.
“The reusable spacecraft would minimise the launching cost by 90 percent. We have set 2030 as deadline to reach this goal,” he said.
In next five years, ISRO has plans to launch one ASTROSAT, which is a low cost version of Hubble Telescope, one GPS navigation satellite and a special satellite that can provide Internet services, informed the VSSC director.
“Because of our cost effective technology, many developed nations, including France and the US are willing to launch their satellites with our system. Many smaller and mini satellite launching programmes on commercial basis are in offing,” Veeraraghavan said while attending the National Technology Day seminar organised by National Aluminum Company (Nalco) here yesterday.
The French satellite SPOT (Satellite Pour l'observation de la Terre) is a high-resolution, optical imaging, earth observation satellite system. Currently SPOT 5 is working in the space and is expected to be withdrawn by the end of 2013. India will launch the SPOT 6 satellite, which will provide continuous high definition images of earth.
Due to the cost effectiveness of India-made PSLV (Polar Satellite Launch Vehicle) and GSLV (Geosynchronous Satellite Launch Vehicles), many countries prefer India to launch their satellites. Recently ISRO successfully placed Singapore's first experimental satellite in space. India has so far launched 27 foreign satellites and 60 India-made satellites.
Currently, it costs $25,000 per kg to launch a satellite. The satellites can weigh 500 to 5,000 kg. Sometimes mini-satellites weighing 15-20 kg are bundled with the rocket and are placed in desired orbits.
However, profit realisation from satellite launch is currently lower because of high cost of fuel and one-time use of the rockets. Veeraraghvan said, ISRO is working on a project to develop reusable satellite launcher.
“The reusable spacecraft would minimise the launching cost by 90 percent. We have set 2030 as deadline to reach this goal,” he said.
In next five years, ISRO has plans to launch one ASTROSAT, which is a low cost version of Hubble Telescope, one GPS navigation satellite and a special satellite that can provide Internet services, informed the VSSC director.
Industrial output registers 7.3 per cent growth in March 2011
New Delhi: India’s industrial output has risen sharply, registering an impressive 7.3 per cent growth in March 2011. The figures show that the Indian economy is keeping up the growth momentum of previous years.
The factory output, as measured by the Index of Industrial Production (IIP), rose 7.3 per cent in March 2011, as compared to the corresponding period a year earlier. The IIP almost doubled the revised 3.7 per cent expansion registered in February 2011. The increase in the factory output signals a strong overall consumer demand.
The new IIP numbers, with 2004-05 as the base year, will start coming from the next month. The current base year is 1993-94.
Exports rose 34 per cent to record US$ 23.9 billion in April 2011, while imports were up 14.1 per cent to US$ 32.8 billion. Among others, passenger cars sales grew at 13.2 per cent in April 2011. In addition, the output of consumer durables expanded 12.3 per cent while that of non-durables rose 5.5 per cent.
The factory output, as measured by the Index of Industrial Production (IIP), rose 7.3 per cent in March 2011, as compared to the corresponding period a year earlier. The IIP almost doubled the revised 3.7 per cent expansion registered in February 2011. The increase in the factory output signals a strong overall consumer demand.
The new IIP numbers, with 2004-05 as the base year, will start coming from the next month. The current base year is 1993-94.
Exports rose 34 per cent to record US$ 23.9 billion in April 2011, while imports were up 14.1 per cent to US$ 32.8 billion. Among others, passenger cars sales grew at 13.2 per cent in April 2011. In addition, the output of consumer durables expanded 12.3 per cent while that of non-durables rose 5.5 per cent.
New rules exempt M&As before June 1
New Delhi: New regime less harsh than the draft guidelines, has a host of exemptions.
Companies fearing a more difficult merger and acquisition (M&A) regime heaved a sigh of relief with the Competition Commission of India (CCI) on Wednesday notifying rules that are less harsh than the draft guidelines. The rules also provide a host of exemptions.
M&As announced before June 1 will be exempted, even if the deal has not been implemented. This means M&A activities in public domain, like the $9.6-billion Cairn-Vedanta deal, will not be scrutinised by CCI.
The filing fee has been slashed from Rs 40 lakh to Rs 50,000 for most cases. Companies will have to pay Rs 10 lakh only in exceptional cases. In the draft rules, the fee was Rs 10-40 lakh depending on the deal value. Acquisitions by venture capital funds and financial institutions will not attract the fee.
“We have taken care of all the concerns of industry. It represents the collective wisdom of all stakeholders, achieved through a unique process of consultation and transparency,” said CCI Chairman Dhanendra Kumar.
The rules allay the fears of industry by mentioning 10 broad criteria for categorising routine business transactions that will be exempted from the filing requirement.
A merger outside India with insignificant impact on local competition or business is one such instance. Acquisition of stock-in-trade, raw materials and assets has also been exempted. This is besides investment in the ordinary course of business, bonus issues, stock splits, etc.
Corporate law firms welcomed the regulations, though they were cautious on certain fronts.
“There continue to be a few issues which we hope will be ironed out in the days to come, including omission of the provision allowing pre-merger consultations and the somewhat vague exemption given to international transactions with no ‘significant nexus’ with or effect on the Indian market. It is unclear how significant the nexus will have to be for a global merger which otherwise meets the thresholds,” said Samir Gandhi of Economic Laws Practice.
“Industry may still have some concerns over the powers of CCI to review acquisitions where control is not being acquired and the notifying party or transaction is subject to a possible 210-day review. The focus will now turn to the actual functioning of the commission and how it will scrutinise the qualifying transactions,” said Pallavi S. Shroff, a competition law expert and senior partner at Amarchand Mangaldas.
Indian companies that need to notify M&As include those with assets of Rs 1,500 crore or a turnover of Rs 4,500 crore. In case of foreign entities, the trigger was assets of $750 million or a turnover of $2,250 million, with assets worth Rs 750 crore or a turnover of Rs 2,250 crore in India, said Manoj Kumar, partner of law firm Hammurabi and Solomon.
Even though the Competition Act was enacted in 2003 and CCI started functioning in a full-fledged manner in 2009, M&As remained out of its purview as specific provisions under the law that deals with M&As were not notified by the government until March this year.
Companies fearing a more difficult merger and acquisition (M&A) regime heaved a sigh of relief with the Competition Commission of India (CCI) on Wednesday notifying rules that are less harsh than the draft guidelines. The rules also provide a host of exemptions.
M&As announced before June 1 will be exempted, even if the deal has not been implemented. This means M&A activities in public domain, like the $9.6-billion Cairn-Vedanta deal, will not be scrutinised by CCI.
The filing fee has been slashed from Rs 40 lakh to Rs 50,000 for most cases. Companies will have to pay Rs 10 lakh only in exceptional cases. In the draft rules, the fee was Rs 10-40 lakh depending on the deal value. Acquisitions by venture capital funds and financial institutions will not attract the fee.
“We have taken care of all the concerns of industry. It represents the collective wisdom of all stakeholders, achieved through a unique process of consultation and transparency,” said CCI Chairman Dhanendra Kumar.
The rules allay the fears of industry by mentioning 10 broad criteria for categorising routine business transactions that will be exempted from the filing requirement.
A merger outside India with insignificant impact on local competition or business is one such instance. Acquisition of stock-in-trade, raw materials and assets has also been exempted. This is besides investment in the ordinary course of business, bonus issues, stock splits, etc.
Corporate law firms welcomed the regulations, though they were cautious on certain fronts.
“There continue to be a few issues which we hope will be ironed out in the days to come, including omission of the provision allowing pre-merger consultations and the somewhat vague exemption given to international transactions with no ‘significant nexus’ with or effect on the Indian market. It is unclear how significant the nexus will have to be for a global merger which otherwise meets the thresholds,” said Samir Gandhi of Economic Laws Practice.
“Industry may still have some concerns over the powers of CCI to review acquisitions where control is not being acquired and the notifying party or transaction is subject to a possible 210-day review. The focus will now turn to the actual functioning of the commission and how it will scrutinise the qualifying transactions,” said Pallavi S. Shroff, a competition law expert and senior partner at Amarchand Mangaldas.
Indian companies that need to notify M&As include those with assets of Rs 1,500 crore or a turnover of Rs 4,500 crore. In case of foreign entities, the trigger was assets of $750 million or a turnover of $2,250 million, with assets worth Rs 750 crore or a turnover of Rs 2,250 crore in India, said Manoj Kumar, partner of law firm Hammurabi and Solomon.
Even though the Competition Act was enacted in 2003 and CCI started functioning in a full-fledged manner in 2009, M&As remained out of its purview as specific provisions under the law that deals with M&As were not notified by the government until March this year.
Monday, May 2, 2011
GlaxoSmithKline Biologicals in talks to buy BE's vaccine division
Bangalore: GlaxoSmithKline Biologicals , a division of global drug giant Glaxo, is in talks with the Hyderabad-based Biological E Ltd (BE) to purchase its vaccines division , people familiar with the discussions said.
This division produces and markets a range of paediatric and adult vaccines and has a sizeable market share in the Indian vaccine market . Officials from Glaxo Biologicials, which is based in Belgium, recently visited the Indian firm's manufacturing facility in Shameerpet near Hyderabad, people close to the development said.
Biological E managing director Dr Vijay Kumar Datla did not respond to an emailed questionnaire on the issue. A Glaxo spokesperson in Mumbai declined to comment.
BE, which has already invested around Rs 350 crore for its facilities, has three key divisions, biologics, pharma and public markets. Biologics makes paediatric and adult vaccines, while public markets is in charge of distributing all kinds of vaccines to the state and central govt and public health services.
The talks are believed to be at a preliminary stage. The Biological E's website says that it was the first private sector company to enter the vaccines market. Diphtheria and tetanus vaccines are some of its key products and this has given BE a significant share of the Indian vaccine market. Its pharma division manufactures solid dosage forms, liquid orals, syrups and active pharmaceutical ingredients catering to both local and international markets.
A pharma analyst said Glaxo had recently faced some constraints in supplying vaccines to its markets around the world from its plant in Nashik, Maharashtra. It would be interested in buying out companies with modern manufacturing facilities approved by international agencies like US FDA, said the analyst, who did not wish to be quoted because he is not authorised by his firm to speak. He also added that GSK Biologicals is globally huge in paediatric vaccines and BE's expertise in that segment would offer excellent synergies in terms of a strategic fit.
Glaxo was also believed to be interested in Shantha Biotech which was eventually sold to French drugmaker Sanofi's vaccine division for $ 780 million in 2009.
The Belgium-headquartered GSK Biologicals is one of the world's leading vaccine manufacturers and employs more than 1,000 research scientists. As per a previous company statement, in India, the division leads the vaccine market in terms of market share and also exports vaccines to both developed and developing markets.
LED maker Lighting Science to foray into India by September
New Delhi: US-based LED manufacturer Lighting Science Group, a global leader in its business, plans to enter the Indian market by September with an eye to grab 20% share of the market over three years.
The company is in advanced talks with three to four domestic LED manufacturers to float an Indian joint venture (JV), industry sources said. Lighting Science Group will hold a majority stake in the joint venture to be named Lighting Science India. The company plans leveraging existing retail network and manufacturing lines of its Indian partner.
Lighting Science Group managing director (India) Arun Narayan told ET that the current Indian market is estimated at $40 million (about 180 crore) and is likely to grow to $400 million (Rs 1,800 crore) by 2014. The company, managed by $2 billion Pegasus Capital Advisors, has applied for Nasdaq listing.
"Lighting Science India targets 15-20% of the growing market," said Narayan. The Indian LED market is in a nascent stage with a few major players like Philips and Crompton Greaves . In India, LED bulbs are about 4-5 times costlier than incandescent bulbs and compact fluorescent lamps (CFLs). Lighting consumes about 20% of energy and LEDs can bring it down to 4%, said Narayan.
Australia , the United States and European Union have barred use of incandescent lamps. In order to encourage use of the energy efficient bulbs, the government in budget 2011-12 halved excise duty on LED bulbs to 5% while the special counter veiling duty of 4% was abolished.
Lighting Science Group expects to earn the majority of its revenues in India by supplying LEDs to local municipal authorities for street lighting. The company also targets to sell its product to industrial units. Retail sales of LEDs would begin in the next two years, Narayan said. The government has recently asked eight industries, including thermal power projects, fertiliser, cement, and iron & steel manufacturing units, to comply with energy efficiency norms. Units consuming more energy than designated would be penalised. It is expected that the nine sectors would have to invest about 30,000 crore over the next three years to comply with the norms.
Lighting Science Group would initiate talks with state governments, local authorities, real estate developers and industrial units for supply of products. The company has engaged Dixon as its first distributor and would form tie-ups with more regional distributors.
The company is in advanced talks with three to four domestic LED manufacturers to float an Indian joint venture (JV), industry sources said. Lighting Science Group will hold a majority stake in the joint venture to be named Lighting Science India. The company plans leveraging existing retail network and manufacturing lines of its Indian partner.
Lighting Science Group managing director (India) Arun Narayan told ET that the current Indian market is estimated at $40 million (about 180 crore) and is likely to grow to $400 million (Rs 1,800 crore) by 2014. The company, managed by $2 billion Pegasus Capital Advisors, has applied for Nasdaq listing.
"Lighting Science India targets 15-20% of the growing market," said Narayan. The Indian LED market is in a nascent stage with a few major players like Philips and Crompton Greaves . In India, LED bulbs are about 4-5 times costlier than incandescent bulbs and compact fluorescent lamps (CFLs). Lighting consumes about 20% of energy and LEDs can bring it down to 4%, said Narayan.
Australia , the United States and European Union have barred use of incandescent lamps. In order to encourage use of the energy efficient bulbs, the government in budget 2011-12 halved excise duty on LED bulbs to 5% while the special counter veiling duty of 4% was abolished.
Lighting Science Group expects to earn the majority of its revenues in India by supplying LEDs to local municipal authorities for street lighting. The company also targets to sell its product to industrial units. Retail sales of LEDs would begin in the next two years, Narayan said. The government has recently asked eight industries, including thermal power projects, fertiliser, cement, and iron & steel manufacturing units, to comply with energy efficiency norms. Units consuming more energy than designated would be penalised. It is expected that the nine sectors would have to invest about 30,000 crore over the next three years to comply with the norms.
Lighting Science Group would initiate talks with state governments, local authorities, real estate developers and industrial units for supply of products. The company has engaged Dixon as its first distributor and would form tie-ups with more regional distributors.
Venus Remedies successfully completes Phase I & II clinical trials of cancer detection molecule
Chandigarh: Chandigarh-based Venus Remedies Limited has successfully completed Phase I and II clinical trial for VRP1620, a cancer detection molecule. The clinical study has shown excellent results in detection of breast cancer. With this drug, detection of breast cancer would be possible even with a simple X-ray using dye and the sensitivity of other detection devices such as coloured doppler, PET would be increased several times.
On the occasion Manu Chaudhary, Research Director of the company told, “VRP 1620 (Tumatrek) is a unique and cost effective diagnostic tool for cancer which can also detect malignancy even through X-ray. It can detect cancer at lesser cost and at primary stage itself.” By detection of cancer at early stage it can increase the cure rate. Scientists believe that after Phase III trials of this product VRP-1620 may also help in locating proliferation of cancer site.
GVFL in talks with global PE firms
Mumbai/Ahmedabad: With the Gujarat Venture Finance Limited (GVFL) receiving first tranche of Rs 200 crore from the state government, the venture capital (VC) firm is now aiming to raise around Rs 500 crore of its Rs 1000-crore infrastructure fund - Golden Gujarat Growth Fund Series-1 by June 30, 2011. What's more, GVFL is also in talks with domestic and international funding institutions like private equity companies, banks, insurance firms and pension funds to raise the remaining funds.
The first closure is expected by June 2011 with available funds of Rs 500 crore and the final closure will take place after a year, in June 2012. However, the company would start appraising project proposals and would start taking up due diligence of the infrastructure projects from May 2011 onwards.
"The first fund closure will take place by June this year. But simultaneously we will also start considering the prospective projects for investments. From May 2011 onwards we intend to initiate the process of due-diligence of the projects. We are hopeful to get funding commitments from the companies by then. Currently, the talks are on with domestic and international financial institutions," said H C Pattnaik, executive director, GVFL. So far GVFL has approached financial institutions like LIC of India, Asian Development Bank, SIDBI and a few international private equity firms.
Gujarat government will contribute 20 per cent of the total fund size, while anchor bank and anchor industry would contribute 10 per cent each for the fund. The remaining 60 per cent will be raised from domestic and international institutional investors. The state government has made a budgetary provision of Rs 200 crore for the fund in the annual budget 2011-12 presented in February.
State-promoted venture financing company, GVFL had announced the Rs 1000 crore infrastructure fund during the Vibrant Gujarat Global Investors' Summit 2011 held in January this year. The fund has been registered with Securities and Exchange Board of India (SEBI) and would invest in the companies from high-end small and medium enterprises segment to mid corporate firms having operations in infrastructure space and alternate energy including green and clean technology.
Some of the companies and investment bankers have already started approaching GVFL with investment proposals for projects development.
"We are receiving enquiries and investment proposals from investment banks and companies. But we have not identified any project so far. It will be decided after the due-diligence of the projects from May onwards," Pattnaik informed.
The seven year fund is expected to yield average internal rate of return (IRR) of around 20 per cent for the investors. The Gujarat government holds 56 per cent in GVFL through public sector units while HDFC holds 13.6 per cent. ICICI Group and other entities have around 20 per cent stakeholding in the company.
Cabinet nod to set up panel for two fab plants
New Delhi: The Union Cabinet on Wednesday approved setting up of an Empowered Committee to identify technology and investors for establishing two semiconductor wafer fabrication (fab) manufacturing facilities.
The decision is expected to have a significant impact in resolving issues in the capital-intensive electronics hardware sector and help the industry develop localised content. Investment for the two wafer fabs is estimated to be Rs 25,000 crore.
The committee comprises adviser to prime minister on public information, infrastructure and innovation; chairman of National Manufacturing Competitiveness Council; secretary, Department of Expenditure; member (industry), Planning Commission; M J Zarabi, former chairman and managing director, Semiconductor Complex Ltd; and secretary in Department of Information Technology. It may co-opt any other experts.
It will identify technology and potential investors for the establishment of semiconductor wafer fabs, and thereafter ascertain their interest in setting up of fab facilities in the country. It will assess and recommend the nature and quantum of government support like equity, grants, subsidies in physical and financial terms to set up the facilities. It will submit its recommendations by July 31.
The fabs are expected to have catalytic impact on development of downstream and upstream products, including ancillaries. It may have sizeable impact on the development of IT/ITeS sector. It will generate employment for 30 million people by 2020.
The decision is expected to have a significant impact in resolving issues in the capital-intensive electronics hardware sector and help the industry develop localised content. Investment for the two wafer fabs is estimated to be Rs 25,000 crore.
The committee comprises adviser to prime minister on public information, infrastructure and innovation; chairman of National Manufacturing Competitiveness Council; secretary, Department of Expenditure; member (industry), Planning Commission; M J Zarabi, former chairman and managing director, Semiconductor Complex Ltd; and secretary in Department of Information Technology. It may co-opt any other experts.
It will identify technology and potential investors for the establishment of semiconductor wafer fabs, and thereafter ascertain their interest in setting up of fab facilities in the country. It will assess and recommend the nature and quantum of government support like equity, grants, subsidies in physical and financial terms to set up the facilities. It will submit its recommendations by July 31.
The fabs are expected to have catalytic impact on development of downstream and upstream products, including ancillaries. It may have sizeable impact on the development of IT/ITeS sector. It will generate employment for 30 million people by 2020.
Nasscom sees strong spurt in tech demand
New Delhi: Technology industry body National Association of Software and Services Companies (Nasscom) sees a strong revival of demand that could not only help meet, but even exceed, growth expectations for 2011-12. Newly-appointed Nasscom chairman for 2011-12, Rajendra S Pawar said in an interaction with ET: "We are coming back to growth levels seen prior to the slowdown and in the near term we see lot of headroom to catapult this growth.''
When asked whether this means Nasscom will revise its 15-17 % growth target for the year for the $70 billion technology and business services sector, Pawar said, "it's too early to comment, but we are on track to exceed this target.'' Pawar, 60, co-founder and chairman of education software company, NIIT , took over as Nasscom chairman from Harsh Manglik. Nasscom also appointed N Chandrasekaran as vice-chairman of it's executive council. Chandrasekaran is CEO and MD of Tata Consultancy Services , the largest Indian technology services company.
As chairman of the executive council, Pawar will lead and assist Nasscom in catalysing the growth of the Indian IT-BPO industry and enabling the sfulfilment of its future goals and aspirations. Towards this end, Pawar wants to focus on two areas. First, how Nasscom will facilitate growth of the small and mid-sized companies. "There are a lot of SMEs focused on software products, telecom, internet space, all driven by intellectual property. By the end of this decade we see quite a few of them becoming very big,'' Pawar said. And second, 'IT for India', that is, how Nasscom can help in e-governance projects. "Government technology initiatives are beginning to get critical mass. We will engage with these projects and see what opportunity is available to companies,'' he added. Besides, Nasscom will push for private sector partnerships in e-governance projects.
On sops to industry, particularly for SMEs, Pawar said, "we will align with the new direct tax code. The new tax regime is supportive of growth and will help the industry.'' Pawar takes over at a time, when on the one hand the industry is coping with quality of talent issues and on the other, later in the year, could see a return of the anti-offshoring wave, as build up for the US elections starts. On strategies to cope with these Mr Pawar said "talent is a big issue and industry will have to accelerate shifts to new models (like de-link revenue and manpower growth) and focus on innovation. On anti-offshoring , we will be engaging a lot more with various stakeholders.''
When asked whether this means Nasscom will revise its 15-17 % growth target for the year for the $70 billion technology and business services sector, Pawar said, "it's too early to comment, but we are on track to exceed this target.'' Pawar, 60, co-founder and chairman of education software company, NIIT , took over as Nasscom chairman from Harsh Manglik. Nasscom also appointed N Chandrasekaran as vice-chairman of it's executive council. Chandrasekaran is CEO and MD of Tata Consultancy Services , the largest Indian technology services company.
As chairman of the executive council, Pawar will lead and assist Nasscom in catalysing the growth of the Indian IT-BPO industry and enabling the sfulfilment of its future goals and aspirations. Towards this end, Pawar wants to focus on two areas. First, how Nasscom will facilitate growth of the small and mid-sized companies. "There are a lot of SMEs focused on software products, telecom, internet space, all driven by intellectual property. By the end of this decade we see quite a few of them becoming very big,'' Pawar said. And second, 'IT for India', that is, how Nasscom can help in e-governance projects. "Government technology initiatives are beginning to get critical mass. We will engage with these projects and see what opportunity is available to companies,'' he added. Besides, Nasscom will push for private sector partnerships in e-governance projects.
On sops to industry, particularly for SMEs, Pawar said, "we will align with the new direct tax code. The new tax regime is supportive of growth and will help the industry.'' Pawar takes over at a time, when on the one hand the industry is coping with quality of talent issues and on the other, later in the year, could see a return of the anti-offshoring wave, as build up for the US elections starts. On strategies to cope with these Mr Pawar said "talent is a big issue and industry will have to accelerate shifts to new models (like de-link revenue and manpower growth) and focus on innovation. On anti-offshoring , we will be engaging a lot more with various stakeholders.''
India's refining capacities to rise to 240 MTPA by Mar 2012
Mumbai/Ahmedabad: India's petroleum refining capacities is expected to rise to 240 million tonnes per annum (MTPA) by March 2012 from the current 188 MTPA, attracting an estimated investment of Rs 60,000-65,000 crore. The capacity addition is believed to boost country's exports of petroleum products, informed a top government official here on Wednesday.
S Sundereshan, secretary, ministry of petroleum & natural gas, government of India today stated that the country would have an excess petroleum refining capacity of around 90 million tonnes per annum in next 12 to 18 months.
"Currently, we have an installed refining capacity of 188 MTPA, while several green field refinery projects are lined up and are expected to be operational by March 2012. This will increase the total refining capacity to 240 million tonnes," he said adding that the new refining capacities would attract an investment of around Rs 60,000-65,000 crore.
Currently, India's total demand for the petroleum products is pegged at around 140 MTPA. This creates a spare capacity of 48 million tonnes per annum at the refineries. The spare capacity will increase to around 90 million tonnes per annum. The domestic demand is expected to be around 142- 143 tonnes per annum.
"We will be actually exporting a total of 90 million tonnes of petroleum products to some of the most developed countries including the US and European countries," added Sundereshan.
S Sundereshan, secretary, ministry of petroleum & natural gas, government of India today stated that the country would have an excess petroleum refining capacity of around 90 million tonnes per annum in next 12 to 18 months.
"Currently, we have an installed refining capacity of 188 MTPA, while several green field refinery projects are lined up and are expected to be operational by March 2012. This will increase the total refining capacity to 240 million tonnes," he said adding that the new refining capacities would attract an investment of around Rs 60,000-65,000 crore.
Currently, India's total demand for the petroleum products is pegged at around 140 MTPA. This creates a spare capacity of 48 million tonnes per annum at the refineries. The spare capacity will increase to around 90 million tonnes per annum. The domestic demand is expected to be around 142- 143 tonnes per annum.
"We will be actually exporting a total of 90 million tonnes of petroleum products to some of the most developed countries including the US and European countries," added Sundereshan.
I-T Dept begins work on real-time network
New Delhi: Aim is to integrate the entire collection network, to enable instantaneous monitoring.
The Income Tax (I-T) Department has embarked on a plan to create a national data centre to facilitate a management information systems-based, real-time analysis of data for quick and effective decision making.
There will be a single custodian of all data captured by the integrated system. The MIS advisory panel of the department has recommended that the Directorate of Organisation and Management Services will be the nodal agency for all statistical data.
In the new system, reports of the investigation wing associated with search and seizure activities would be filed within 24 hours. Daily collection reports would be generated through the system and made available to the top management.
The advisory group has suggested the new MIS format be implemented with immediate effect. The required capabilities are being put in place.
The system will have safeguards to ensure security of all information assets and the database, through systemic implementation of periodic vulnerability testing, security and forensic audits to prevent fraud.
A senior official told Business Standard the requisite for online report generation was to ensure all actions by the field officers were done through the system. The Central Board of Direct Taxes (CBDT) is to issue instructions in this regard soon.
“The ultimate objective is to create a single data centre under a single custodian for storing all taxpayer and third-party data. The system will facilitate business intelligence out of processed data and make it available to the actual users on almost a real-time basis,” he added.
The plan envisages augmented computational capability and network connectivity for handling huge data volumes. “This would be a uniform holistic rule-based application matrix that can optimally run on state of the art hardware and networks,” said the official.
The idea is to integrate all the elements of tax collection through technology, with information seamlessly flowing to the users for informed decision making.
The CBDT MIS advisory panel was constituted in the backdrop of the reiteration by Parliament’s Standing Committee on Finance in September 2010 of the urgency for implementation of an action plan in this regard. The panel was asked to come up with an implementation plan so that work on it could be initiated from the first month of the current financial year.
The Income Tax (I-T) Department has embarked on a plan to create a national data centre to facilitate a management information systems-based, real-time analysis of data for quick and effective decision making.
There will be a single custodian of all data captured by the integrated system. The MIS advisory panel of the department has recommended that the Directorate of Organisation and Management Services will be the nodal agency for all statistical data.
In the new system, reports of the investigation wing associated with search and seizure activities would be filed within 24 hours. Daily collection reports would be generated through the system and made available to the top management.
The advisory group has suggested the new MIS format be implemented with immediate effect. The required capabilities are being put in place.
The system will have safeguards to ensure security of all information assets and the database, through systemic implementation of periodic vulnerability testing, security and forensic audits to prevent fraud.
A senior official told Business Standard the requisite for online report generation was to ensure all actions by the field officers were done through the system. The Central Board of Direct Taxes (CBDT) is to issue instructions in this regard soon.
“The ultimate objective is to create a single data centre under a single custodian for storing all taxpayer and third-party data. The system will facilitate business intelligence out of processed data and make it available to the actual users on almost a real-time basis,” he added.
The plan envisages augmented computational capability and network connectivity for handling huge data volumes. “This would be a uniform holistic rule-based application matrix that can optimally run on state of the art hardware and networks,” said the official.
The idea is to integrate all the elements of tax collection through technology, with information seamlessly flowing to the users for informed decision making.
The CBDT MIS advisory panel was constituted in the backdrop of the reiteration by Parliament’s Standing Committee on Finance in September 2010 of the urgency for implementation of an action plan in this regard. The panel was asked to come up with an implementation plan so that work on it could be initiated from the first month of the current financial year.
Service tax reduction likely for inland shipping
New Delhi: Transport of goods through coastal and inland shipping may get cheaper, as the finance ministry is planning to increase service tax abatement for the sector. A higher abatement is being proposed to bring some parity in levy of service tax on movement of goods through road, rail and shipping.
The service tax on shipping was introduced in Budget 2009-10. In Budget 2011-12, the government provided an abatement of 25 per cent on transport of goods through coastal and inland shipping.
Shipping secretary K Mohandas has now written to the finance ministry, asking for higher abatement. “We are considering the proposal to increase abatement for coastal shipping. We want to promote coastal shipping because it is an energy-efficient, environment-friendly and economical mode of transportation of goods,” said a finance ministry official, who did not wish to be identified.
The industry has been asking for uniformity in service tax abatement between shipping and other transportation modes such as road and rail.
The finance ministry gives 75 per cent abatement in case of road transport. It has also provided 70 per cent abatement for the railways.
Service tax on rail freight, however, is yet to come into force, as the finance ministry had again deferred its introduction, till June.
The official said the abatement could not be as high as 75 per cent and the finance ministry could increase it to only 35 per cent. This would mean a coastal operator would have to pay service tax at 10 per cent on 65 per cent of the total freight value, compared with a road operator, who would pay service tax on 25 per cent of the freight value.
The finance ministry has asked the shipping ministry to provide data on the cost of services involved in transporting goods from one place to another through coastal and inland shipping.
“We want to know the cost of service element in shipping. Our analysis said it is about 75 per cent. That is why we gave only 25 per cent abatement. If they say it is less and substantiate it with relevant data we will give them abatement accordingly,” the official added.
In its vision document for the next 10 years, the shipping ministry had set a target of increasing port capacity to around 3,200 million tonnes, with an investment of about Rs 3 lakh crore.
It has proposed to enhance the Indian tonnage four-fold by 2020, improve India’s share in global shipbuilding to five per cent and increase the share of Indian seafarers to at least 10 per cent.
The service tax on shipping was introduced in Budget 2009-10. In Budget 2011-12, the government provided an abatement of 25 per cent on transport of goods through coastal and inland shipping.
Shipping secretary K Mohandas has now written to the finance ministry, asking for higher abatement. “We are considering the proposal to increase abatement for coastal shipping. We want to promote coastal shipping because it is an energy-efficient, environment-friendly and economical mode of transportation of goods,” said a finance ministry official, who did not wish to be identified.
The industry has been asking for uniformity in service tax abatement between shipping and other transportation modes such as road and rail.
The finance ministry gives 75 per cent abatement in case of road transport. It has also provided 70 per cent abatement for the railways.
Service tax on rail freight, however, is yet to come into force, as the finance ministry had again deferred its introduction, till June.
The official said the abatement could not be as high as 75 per cent and the finance ministry could increase it to only 35 per cent. This would mean a coastal operator would have to pay service tax at 10 per cent on 65 per cent of the total freight value, compared with a road operator, who would pay service tax on 25 per cent of the freight value.
The finance ministry has asked the shipping ministry to provide data on the cost of services involved in transporting goods from one place to another through coastal and inland shipping.
“We want to know the cost of service element in shipping. Our analysis said it is about 75 per cent. That is why we gave only 25 per cent abatement. If they say it is less and substantiate it with relevant data we will give them abatement accordingly,” the official added.
In its vision document for the next 10 years, the shipping ministry had set a target of increasing port capacity to around 3,200 million tonnes, with an investment of about Rs 3 lakh crore.
It has proposed to enhance the Indian tonnage four-fold by 2020, improve India’s share in global shipbuilding to five per cent and increase the share of Indian seafarers to at least 10 per cent.
Government tells states to upgrade statistical divisions
New Delhi: The Centre has asked states for specific plans to help strengthen the statistical system, for which $107 million (Rs 470 crore) has been sanctioned in collaboration with the World Bank, as the veracity of various statistical data has drawn flak.
M S Gill, Union minister of statistics and programme implementation, has written to all chief ministers to also ensure their existing statistical divisions are upgraded to a separate department of statistics to improve the quality of data.
The National Statistical Commission under the chairmanship of C Rangarajan had recommended the elevation of statistical divisions in states.
“The ministry is undertaking the centrally sponsored scheme, ‘India Statistical Strengthening Project’ in collaboration with the World Bank... to strengthen the statistical system of state/UT governments for collecting, compiling and disseminating reliable statistics for planning and policy making,” the letter said. The letter asked states to upgrade their directorates of economics and statistics to a separate department of statistics.
Heads of the existing directorate should be scaled up to the level of secretary to the state government, Gill said.
He wanted existing directors be closely involved in the decision by making them members of committees or groups dealing with plans and programmes.
The letter further asked states to create a common statistical cadre and state statistical service for manning statistical posts in all departments.
This will empower the directorate in discharging the role of a nodal agency, effectively laying the grounds for developing a sound statistical system, that will improve the growing requirements of planners and policy makers for informed decision making.
M S Gill, Union minister of statistics and programme implementation, has written to all chief ministers to also ensure their existing statistical divisions are upgraded to a separate department of statistics to improve the quality of data.
The National Statistical Commission under the chairmanship of C Rangarajan had recommended the elevation of statistical divisions in states.
“The ministry is undertaking the centrally sponsored scheme, ‘India Statistical Strengthening Project’ in collaboration with the World Bank... to strengthen the statistical system of state/UT governments for collecting, compiling and disseminating reliable statistics for planning and policy making,” the letter said. The letter asked states to upgrade their directorates of economics and statistics to a separate department of statistics.
Heads of the existing directorate should be scaled up to the level of secretary to the state government, Gill said.
He wanted existing directors be closely involved in the decision by making them members of committees or groups dealing with plans and programmes.
The letter further asked states to create a common statistical cadre and state statistical service for manning statistical posts in all departments.
This will empower the directorate in discharging the role of a nodal agency, effectively laying the grounds for developing a sound statistical system, that will improve the growing requirements of planners and policy makers for informed decision making.
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