The Financial Express

Print media holds its own among India's youth

2010-02-09T10:37:00.003+05:30

FE presents a peek into the first-ever readership survey of literate Indian youth, commissioned by National Book Trust and conducted by a National Council of Applied Economic Research team led by senior fellow Rajesh Shukla

A majority of the 333-million-odd literate youth in the country are religious, support the Women’s Reservation Bill, evince little interest in politics or fashion, and are generally happy with their lot. Almost a fourth of them get a newspaper at home, and around one in ten subscribe to a magazine.

Even in an age of over a hundred 24x7 news channels, newspapers are seen as the primary source for news & current affairs, with television largely an entertainment medium.

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Rupee slide to continue, RBI not likely to intervene

2010-02-08T10:45:00.003+05:30

With the dollar gaining ground against major currencies like the euro, the rupee is expected to further weaken in the short term. On Friday , the Indian currency weakened 1.05% to 46.7425 against the greenback at the close, and for the week on a whole it weakened by 1.22%. Analysts believe the downward trend in rupee will continue for a while.

Says Madhusudan Somani, head of foreign exchange trading at YES Bank, "Going forward, one can expect some pressure on the rupee given a correction in the equity markets and an increase in the global risk aversion."

Somani adds in the last few days, there has also been a lot of dollar demand from the oil companies -which is leading to further weakness in rupee.

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Brown writes to Prime Minister on Vodafone tax issue

2010-02-05T10:32:00.001+05:30

Over a year after the Supreme Court dismissed telecom major Vodafone’s petition challenging Indian tax authorities’ jurisdiction over its $11.2-billion acquisition of Hutchison Essar in 2007, UK Prime Minister Gordon Brown has written to Prime Minister Manmohan Singh warning that such tax treatment will affect India’s investment climate.

Brown’s missive follows a show cause notice by the income tax department to Vodafone in October 2009 — that was a step towards raising a tax demand on the firm for $1.7 billion on capital gains, and possibly even penalties with 18% annual interest since the transaction.

Vodafone had questioned the tax department’s jurisdiction over share transfer between two overseas companies

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Parikh: end fuel sops; Deora mum on political will

2010-02-04T10:30:00.002+05:30

The government on Wednesday made clear its intention to scrap subsidies for auto fuels and move decisively towards market-aligning the price of LPG and public distribution system (PDS) kerosene. Petroleum secretary Sundareshan said Prime Minister Manmohan Singh has instructed the ministry to swiftly process the recommendations of an expert group headed by former Planning Commission member Kirit Parikh on the pricing of petroleum products.

In its report submitted to petroleum minister Murli Dora on Wednesday, the expert group proposed total decontrol of petrol and diesel prices. It also called for an immediate Rs 6-a-litre hike in the PDS kerosene price and a Rs 100-a-cylinder increase in the price of domestic LPG. While releasing the expert group’s report, Deora said his officers would move a Cabinet note very soon in this regard, but declined to comment on whether the recommendations are politically acceptable to the ruling coalition.

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Government plans to ease FDI norms for exchanges

2010-02-03T10:40:00.003+05:30

Foreign investors in India’s stock and commodity exchanges will soon be able to raise their stakes, as the government plans to raise the cap on FDI by any single investor from the present 5%. However, the overall cap on FDI for these bourses would remain 49%.

Once the cap for individual investors is raised, India’s underdeveloped exchange business could receive a fillip, leading to more meaningful competition between the bourses resulting in efficiency of operations and better investor services. The move, sources said, could also pave the way for more exchanges being set up in the country.

Millions of potential investors are yet to enter the equity market, as the present system does not entice them enough

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`India has done a good job branding itself'

2010-02-02T11:00:00.003+05:30

Martin Sorrell is CEO of WPP, one of the world’s largest media and communications services firms. In an interview at Davos with Express Group Editor-in-Chief Shekhar Gupta on NDTV 24x7’s Walk the Talk, Sorrell talks about Brand India, fragmentation of the media and why India needn’t be worried about its single-digit growth.

You have been saying these are not better times, these are less worse times.

It doesn’t apply to India. People in India, and people generally, thought nothing could happen to disturb the growth pattern in India.

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Clause 49 compliance to speed up CPSE listings

2010-02-01T10:27:00.001+05:30

In a clear sign that the Centre’s disinvestment programme would be expanded substantially next fiscal, the government has decided to set an early deadline for central public sector enterprises (CPSEs) to reorganise their boards to meet Clause 49 of Sebi’s listing agreement.

“We are having a re-look at the process of appointment of independent directors in public sector firms. We have decided to fix a mandatory timeframe for making these appointments. For this, we are in talks with PESB (Public Enterprises Selection Board),” Department of Public Enterprises secretary Bhaskar Chatterjee told FE.

In normal course, the appointment of independent directors to a PSU board takes more than six months, due to the formalities involved.

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Obama targets outsourcing, wants US jobs

2010-01-29T11:09:00.003+05:30

The country’s $50-billion software services export industry once again came in the line of fire with US President Barrack Obama reiterating his proposal to “slash the tax breaks for companies that ship our jobs overseas” and instead “give those tax breaks to companies that create jobs in the USA”.

Though the Senate is yet to pass the jobs Bill that “includes some of these steps”, Obama’s rhetoric once again sent shivers down the industry’s spines, as the US market accounts for close to 60% of its revenues. A report by IT consultancy firm Forrester Research estimates that 3.3 million American jobs will be lost to outsourcing in 15 years ending 2015.

Obama’s statement, which was part of his State of the Union address, while meeting with thunderous applause on Capitol Hill may not impact the Indian outsourcing industry immediately.

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Camry, Corolla sales in United States halted, no recall in India

2010-01-28T10:16:00.003+05:30

A day after Toyota Motor Corporation of Japan decided to suspend sales in the US of eight models including the Camry, America’s best-selling car, and the Corolla following a massive safety recall, its Indian subsidiary said there would be no such recall of these models in India.

Toyota last week ordered the unprecedented US recall involving 2.3 million vehicles to fix accelerator pedals that could stick and cause acceleration without warning. Toyota is also halting production at six North American car assembly plants, beginning the week of February 1, and gave no date on when production could restart.

Reassuring car owners in India, a Toyota Kirloskar Motor spokesperson told FE: “There has been absolutely no impact of the global recall on our Indian product line-up.

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Orissa CM updates S Korean President on Posco status

2010-01-27T10:46:00.001+05:30

Orissa chief minister Naveen Patnaik on Tuesday rushed to New Delhi to update visiting South Korean President Lee Myung-Bak on the status of Posco-India's $12-billion, 12-million tonne steel plant in the state.

Patnaik, accompanied by principal secretary Bijaya Kumar Patnaik, took a special flight to Delhi soon after the Republic Day parade at Cuttack this morning. He met Lee at Rastrapati Bhawan.

The impromptu meeting was arranged after Lee sought first hand information about the big ticket project from the Orissa chief minister.

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Government to set up climate panel

2010-01-22T12:31:00.004+05:30

Minister for environment & forests Jairam Ramesh said he felt"vindicated" by the Intergovernmental Panel on Climate Change (IPCC) goes up on the life of Himalayan glaciers. In an exclusive interview with FE, the minister said India would soon have a well-equipped national agency for climate change assessment, as the UN body has proven unequal to the task.

"My ministry brought out a discussion paper on glaciers after it was found that major divergence of views existed between Indian scientists and the IPCC," he said. The new agency would be "an Indian IPCC", the minister said. He added that the UN body, with its biases, seems incapable of original and genuine research, in addition to being insensitive to regional realities.

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Major ports to get pricing freedom

2010-01-21T11:19:00.004+05:30

The government plans to allow major ports to fix tariff on their own in order to give them a level-playing field with minor ports. Currently, the Tariff Authority for Major Ports (TAMP) fixes the upper limits of tariffs for 11 major ports but minor ports, which account for 35% of the port traffic, are free to decide their tariffs.

The policy option to free port tariffs is being considered as an alternative to the earlier idea of bringing minor ports also under the supervision of TAMP. It is reckoned that once adequate port capacities are created, competition would ensure tariffs remain at reasonable levels.

Currently, tariffs for major ports are fixed upfront on a normative basis for a fixed period of time and then the service provider is selected through competitive bidding.

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Pollard tops IPL-3 bids, but no takers for Pakistani players

2010-01-20T11:38:00.002+05:30

Kerion Pollard of the West Indies and Shane Bond of New Zealand were the only two players that fetched more than their reserve price of $750,000 at the Indian Premier League (IPL) Season 3 auction in Mumbai on Tuesday. Of the 67 players on offer, teams bagged only 11. According to television channels, Kerion Pollard became the most expensive player in IPL history with Mumbai Indians reportedly paying over $2 million for the all-rounder.

Since there was a tie-breaker for Pollard, interested teams, including Mumbai Indians and Knight Riders, were given five minutes to raise their bids. Before this, the costliest bid was of $1.55 million for Kevin Pieterson by Bangalore Royal Challengers, while Andrew Flintoff was roped in by Chennai Super Kings for a similar amount. In the first IPL auction, Mahendra Singh Dhoni was picked up Chennai Super Kings for $1.5 million.

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Base metal prices to see sharper spikes in 2010

2010-01-19T10:48:00.002+05:30

Last Wednesday, copper stocks on the benchmark London Metal Exchange stood at 517,175 tonne, up almost 52% from the same period last year, while nickel inventories were almost double at 159,000 tonne.

Similarly, stocks of zinc, aluminium, lead and tin were all at their multi-month highs, a fact that would remind investors that despite the current bull run in metals, all are yet not buying into the story.

Recently, three-month copper futures on the London Metal Exchange (LME) touched a 15-month high.

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Jyoti Basu departs

2010-01-18T14:45:00.002+05:30

Jyoti Basu, veteran Marxist leader, passed away in Kolkata on Sunday after a 16-day battle with pneumonia and other ailments. The 95-year-old leader who ruled Bengal from 1977-2000 was a pillar of strength for his party, the CPI(M), and the Communist movement in India.

As news spread that the patriarch was no more, tributes poured in. PM Manmohan Singh called him a “great son of India.”

“We view his passing with great sorrow.

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Whirlpool hopes to be among top three in AC market

2010-01-15T11:15:00.002+05:30

From a virtually non-existent player in the air conditioner category, Whirlpool of India is eyeing one of the top three slots in the next three years. It is the medium-term goal of the company, as it gains significance in the global operations of Whirlpool Corporation and is leaving no stone unturned to achieve its targets.

Right from revamping its entire product portfolio in the AC category this year, the company is set to pump in money for an all-round marketing campaign as well as expand its dealer network to cater to ever-growing demand for ACs in India, courtesy the extremely low penetration levels in the country.

"We are ramping up our operations in the air conditioner category and are introducing an entire new range of products.

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Wockhardt lenders may sue it abroad

2010-01-13T10:44:00.002+05:30

A major war has broken out between Habil Khorakiwala-led pharma firm Wockhardt and its lenders. Wockhardt, which has defaulted on its Rs 680-crore ($140 million) foreign currency convertible bonds (FCCBs) is learnt to have offered just half of this amount to settle the debt.

US-based investor fund QVT Advisors, which holds 41% of FCCBs, has rejected the offer and in turn offered to redesign the FCCBs for the next five years with a rider that it would get at least 26% stake in the company post-conversion.

If Wockhardt does not accept the offer, QVT is likely to file for the company’s liquidation in the US,

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3 slots up for grabs in 3G auction; bidding process may begin today

2010-01-12T10:54:00.002+05:30

The department of telecommunications has formally suggested that only three slots in each circle be auctioned for 3G spectrum. On Monday DoT finalised a draft notice inviting applications (NIA), a copy of which is with FE. An additional slot has already been allocated to BSNL/MTNL.

Officials told FE that an empowered group of ministers headed by finance minister Pranab Mukherjee will meet on Tuesday to take a final view on the notice. “Once the eGoM ratifies the NIA, it will be officially released, maybe on Tuesday,” an official said.

As first reported by FE, successful bidders will have to cough up the entire bid amount within the current fiscal,

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Services drive growth in poor states

2010-01-11T10:56:00.002+05:30

Service sectors are proving to be the principal growth drivers in India’s conventionally backward states like Bihar, Madhya Pradesh, Orissa and Rajasthan. Construction, telecommunications, banking and insurance, tourism and real estate have led the growth in these states in the five years up to 2008-09, helping them to come out of the morass.

What’s even more heartening is that the spectacular growth in these sectors has been propelled by extensive inputs from low-skill labour. This explodes the myth that service sectors have limited ability to generate such jobs, crucial for greater inclusive growth of the country.

An analysis of the Central Statistical Organisation data by FE shows that construction growth in Bihar between 2004-05 and 2008-09 was 38.1% while it was 14.2% between 2000-01 and 2004-05.

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Maruti parks Eeco in free MPV slot

2010-01-08T11:10:00.002+05:30

Thursday saw the country’s largest passenger car manufacturer, Maruti Suzuki India, set the ongoing Auto Expo abuzz with the launch of its multi-purpose vehicle, the Eeco. Apart from being aggressively priced, it has the potential to redefine the MPV segment, which so far does not have a seven-seat vehicle costing under Rs 3 lakh.

The Eeco, which was conceived and designed in-house by Maruti Suzuki engineers specifically for the Indian market, is sure to gain first mover advantage as it fills a gap in entry-level MPVs. Although built on the platform of the unsuccessful Versa, the auto industry is already giving the new offering its thumbs up.

Maruti’s recently unveiled R3 concept car the first of its kind to be designed entirely in India is also an MPV.

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Glamour shifts into high gear for auto brands

2010-01-07T10:56:00.003+05:30

Apart from record global launches at 10, local launches at 50 and variants at 100, the ongoing Auto Expo has another unique feature, it can boast of the highest footfall of celebrity endorsers.

From some of the most lusted Bollywood faces, like Shah Rukh Khan, Ajay Devgan, Vivek Oberoi and John Abraham, to cricket icon Saurav Ganguly and Moto GP champion Valentino Rossi, all have a date with the week-long motor extravaganza in the Capital. While Shah Rukh, Devgan, Oberoi and Sourav were star crowd-pullers on Wednesday, John Abraham had graced the event the day before. The week-end would see Rossi and Saif Ali Khan dropping in.

Wednesday saw actor Gul Panag as a special invitee of SkodaAuto India,

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Nano to roll into United States in 3 years

2010-01-06T11:10:00.004+05:30

With a successful domestic launch of the Nano in the rear-view mirror, Tata Motors now seeks to make tracks into the competitive US market in three years with a larger, pricier model. Speaking on the first day of the 10th Auto Expo, company chairman Ratan Tata said on Tuesday, “We recognise that there is a market for low-cost cars in developed countries.”

“However, for the US, we need to have a bigger engine on the Nano, and the car has to undergo more crash tests. The company is working on these and I think it is as far as three years before its debut in the US,” Tata cautioned. The US is the world’s largest auto market, although China is set to overtake it shortly.

Earlier, Tata had said hybrid versions of the Nano were planned.Italy’s Fiat and Tata Motors also want to sell the vehicle jointly in Latin America.

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Dubai makes history in hard times, again

2010-01-05T10:56:00.002+05:30

Started at the height of the economic boom and built by some 12,000 labourers, the world’s tallest building opened on Monday in Dubai as the glitzy emirate seeks to rekindle optimism after its financial crisis.

Burj Dubai, whose opening has been delayed twice since construction began in 2004, would mark another milestone for the deeply indebted emirate with a penchant for seeking new records.

Dubai, one of seven members of the United Arab Emirates, gained a reputation for excess with the creation of man-made islands shaped like palms and an indoor ski slope in the desert.

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Bonuses may be back at ICICI Bank

2010-01-04T11:33:00.002+05:30

2010 seems to begin on a good note for the employees of ICICI Bank. The country’s largest private sector lender is likely to give bonuses to majority of its 36,000 staff for the period 2009-10 by April.

Bonus payments were held back by the bank in 2008-09 owing to the overall turmoil in the economy.

The bank had witnessed its first decline in full-year profits since its incorporation in 1994.

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Wall Street had best gains since '03

2010-01-02T10:42:00.004+05:30

US stocks ended 2009 on Thursday with their best gains since 2003, driven by optimism about the economy's recovery and a brighter outlook for profits.

The benchmark Standard & Poor's 500 index rose 23.5% for the year, while the Dow climbed 18.8 % and the Nasdaq jumped 43.9% from its close on December 31, 2008.

It was the market's first annual advance in two years. In 2008, the S&P 500 slid 38.5% when the economic crisis led to Wall Street's worst year since the Great Depression.

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