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.
Success in my Habit
Tuesday, May 31, 2011
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.
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