NEWS – March 2008
- Mixed reaction to excise duty parity on cement
The Business Line, March 01, 2008 - Medicines will be cheaper, but not consumer goods
The Business Line, March 02, 2008 - Farm loan waiver may fuel demand for consumer goods
The Business Line, March 02, 2008 - Lower allocation for defence cable system may delay spectrum release
The Business Line, March 03, 2008 - GMR airport to charge $25 user fee for foreign travel
Business Standard, March 04, 2008 - Govt seeks details of Tata Tele, Virgin tie up
The Financial Express, March 05, 2008 - Chidambaram asks firms not to raise prices
The Financial Express, March 05, 2008 - Steel companies asked to refrain from frequent price increases
The Hindu, March 06, 2008 - Govt imposes terms for wheat purchase by pvt trade
The Financial Express, March 07, 2008 - Aviation industry losses may mount to Rs 2,400 cr
The Financial Express, March 09, 2008 - India needs vigilance on food prices: Montek
Financial Express, March 10, 2008 - India eyes new urban CPI by May ’09
The Financial Express, March 10, 2008 - Govt denies spectrum deal beyond 6.2 MHz
Business Standard, March 11, 2008 - Govt yet to decide on user fee at new private airports
The Business Line, March 12, 2008 - Cabinet approves mineral policy, appellate tribunal
The Business Line, March 14, 2008 - Loan waiver will lead to inflation: Swamy
The Financial Express, March 15, 2008 - Telecom to attract Rs 30,000 cr more
Business Standard, March 16, 2008 - No aggressive tariff cuts: Bharti Airtel
The Financial Express, March 17, 2008 - No immediate impact of fuel price hike
The Financial Express, March 17, 2008 - Govt may continue ops in 2 state-run airports
The Financial Express, March 18, 2008 - SEBI examining alleged insider trading in Reliance Petroleum shares: Govt
The Business Line, March 19, 2008 - TRAI move on unwanted calls unfair: Telcos
The Business Line, March 19, 2008 - 3G auction will be open to both existing and new operators
The Business Line, March 20, 2008 - Cement consumption bounces back in February
The Business Line, March 20, 2008 - Inflation spurts to 10-month high on rising food costs
The Business Line, March 21, 2008 - Review Tata, Virgin deal, GSM players urge DoT
The Business Line, March 21, 2008 - Dearer food: No let-up in commodity prices
The Business Line, March 22, 2008 - DoT warns Blackberry service providers
The Financial Express, March 24, 2008 - IRFC monopoly to end with new wagon leasing plan
The Economic Times, March 26, 2008 - Concern over Reliance move on petrol pumps
The Business Line, March 27, 2008 - Telecom operators may lower tariffs
The Business Line, March 28, 2008 - NTPC exempted from equity cap norms for bidding
The Business Line, March 28, 2008 - Govt pulls out all stops to fight inflation
The Financial Express, March 28, 2008 - Govt will weigh lower growth to contain inflation: Chidambaram
The Business Line, March 29, 2008 - Real(i)ty check on prices under way
The Business Line, March 30, 2008 - States oppose new mineral policy, seek joint task force
The Business Line, March 30, 2008 - Spectrum auction likely in smaller chunks of 5 Mhz
The Business Line, March 31, 2008
Mixed reaction to excise duty parity on cement
The Business Line, Saturday, March 01, 2008
The cement industry remained somewhat divided on the impact of excise duty parity on bulk and packaged cement and the hike in the duty on clinker. Mr N. Srinivasan, Vice-Chairman, India Cements, said that the excise duty on clinker at Rs 450 a tonne will not have a major impact as clinker sales were insignificant. Bringing excise duty rate of bulk cement on par with packaged cement at Rs 400 a tonne too would not have a major impact, he felt.
Medicines will be cheaper, but not consu mer goods
The Business Line, March 02, 2008
Medicine prices are beginning to see the benefits of Budget 2008 proposals, but no such luck for consumer products such as breakfast cereals or pre-mixed tea, for instance. Drug-makers will cut prices by five per cent on all medicines, except those made in tax-free zones. This follows the Budget halving excise duty on finished drugs to eight per cent. Drugs made locally in the cancer, cardio-vascular, anti-diabetic, anti-ulcer and some newer antibiotics can see a five per cent downward price revision, said Mr D.G. Shah of the Indian Pharmaceutical Alliance. The difference will be significant on high-priced locally produced drugs, he observed.
Farm loan waiver may fuel demand for consumer goods
The Business Line, March 02, 2008
Farmers need not worry about loan recovery agents of banks knocking at their doors—at least for the time being— thanks to the Union Finance Minister, Mr P. Chidambaram’s Budget gift to them. Instead, they may have another set of people flocking to their homes—salesmen of different FMCG, consumer durables and home appliance. A majority section of the industry believes that it is worth sharpening its focus on the vast untapped rural market for a wide range of consumer products after the Budget proposal.
Lower allocation for defence cable system may delay spectrum release
The Business Line, March 03, 2008
In a move that could further delay vacation of radio frequency by the Defence forces, the Finance Ministry has made an allocation of only Rs 152 crore for setting up an optical fibre cable network for the armed forces. The project being undertaken by the Department of Telecom is aimed at providing the Defence forces an alternative communication medium and is estimated to cost over Rs 1,000 crore in the first phase. While the Budgetary allocation during 2008-09 for this project is higher than the previous year (Rs 95 crore), it is no where near the cost of the total project.
GMR airport to charge $25 user fee for foreign travel
Business Standard, March 04, 2008
GMR Hyderabad International Airport Ltd (GHIAL), a subsidiary of GMR Group, has decided to charge $25 (about Rs 1,000) as user fee from each passenger travelling abroad from the new Rajiv Gandhi International Airport at Shamshabad, near Hyderabad, GMR Group Chairman (Airports) Kiran Grandhi said today. Passengers travelling to domestic destinations from the airport won’t have to pay any user fee, he said.
Govt seeks details of Tata Tele, Virgin tie up
The Financial Express, March 05, 2008
The government has sought details from Tata Teleservices on its recent tie up with the U.K.’s Virgin Mobile, a senior telecoms official said on Wednesday, but added the two firms had not been barred from rolling out services. Virgin Mobile, a unit of British communications group Virgin Media, on Sunday announced the launch of a youth-focused service in India through Tata Teleservices. “We have asked them for information … to see if it is consistent with licensing conditions,” Telecoms Secretary Siddhartha Behura told reporters at a business conference.
Chidambaram asks firms not to raise prices
The Financial Express, March 05, 2008
Finance Minister on Wednesday urged Companies not to increase prices despite a mismatch in supply and demand in some sectors, asking them to help fight inflation amid a global rise in commodity prices. Palaniappan Chidambaram told a business conference that industry should instead improve efficiency: “Manufacturers have to be more competitive and hold the price line.” The minister said the Monopolies and Restrictive Trade Practices Commission (MRTPC) had in recent months passed two judgements charging cement makers of acting like a cartel.
Steel companies asked to refrain from frequent price increases
The Hindu, March 06, 2008
The Centre on Wednesday asked steel producers to refrain from frequent price hikes and suggested that the views of the Price Monitoring Committee should be factored in while taking a decision on raising the prices of their products. Addressing a seminar on steel and mining organised by the Indian Chamber of Commerce here, Steel Minister Ram Vilas Paswan said: “Stable pricing should be adopted by the steel producers. They should pay due importance to views of the Price Monitoring Committee while deciding on prices of their produce”.
Govt imposes terms for wheat purchase by pvt trade
The Financial Express, March 07, 2008
The government has imposed conditions on corporate houses for purchasing wheat from farmers in the ensuing marketing season beginning April 2008 by invoking the provisions of section 3 of Essential Commodities Act, 1955 (10 of 1955). On Friday the government issued the Wheat (Stock declaration by Companies or Firms or Individuals) Order 2008 which requires submission of return by a company or firm or individual who purchases wheat in excess of 10,000 tonnes (total purchases made throughout the country) during the Rabi Marketing Season 2008-09 (April-March).
Aviation industry losses may mount to Rs 2,400 cr
The Financial Express, March 09, 2008
Despite a huge surge in passenger traffic and revenue from ancillary services, the Indian aviation industry is set to post cumulative losses amounting to around $600 million (approximately Rs 2,400 crore) during 2008, analysts from major brokerage houses have said. According to data from the directorate general of civil aviation (DGCA), the domestic airline industry posted cumulative losses of around $500 million (Rs 2,000 crore) in 2007. This was nearly seven times more than the Rs 301.74 crore losses posted in 2006.
India needs vigilance on food prices: Montek
Financial Express, March 10, 2008
India needs to be vigilant about rising food prices but achieving a goal of 9 percent economic growth on average over the next few years is feasible, Montek Singh Ahluwalia said in an interview. Ahluwalia, the deputy head of India’s Planning Commission, said India should consider setting up a sovereign wealth fund to make use of its swelling foreign exchange reserves, although any such move would take time.
India eyes new urban CPI by May ’09
The Financial Express, March 10, 2008
India is hoping to bring out a new urban consumer price index (CPI) in April or May next year to give a more accurate and harmonised picture of prices in towns and cities, the country’s chief statistician said. India’s most widely watched inflation rate at the moment is a wholesale price index that is published weekly but is generally lower than readings for several consumer price indices, published monthly.
Govt denies spectrum deal beyond 6.2 MHz
Business Standard, March 11, 2008
Communications Minister A Raja on Monday told Parliament that there was no “contractual agreement” between government and telecom operators to allot spectrum beyond 6.2 MHz, a move that could hurt GSM players like Bharti, Vodafone and Idea Cellular. “There is no contractual agreement to give spectrum beyond 6.2 MHz. We are releasing more spectrum based on subscriber base as suggested by the Telecom Regulatory Authority of India (Trai),” Raja said in the House while replying to a question.
Govt yet to decide on user fee at new private airports
The Business Line, March 12, 2008
Less than 96 hours before the opening of the Greenfield airport at Hyderabad, the Government is yet to take a decision on the quantum of User Development Fee (UDF) to be levied on domestic and international passengers at the new Bangalore and Hyderabad airports. Replying to a question raised in the Rajya Sabha, the Minister for Civil Aviation, Mr Praful Patel, said that the UDF would be fixed only after the receipt of the final audited project costs from the developers of the two greenfield airport projects.
Cabinet approves mineral policy, appellate tribunal
The Business Line, March 14, 2008
The Union Cabinet on Thursday cleared the much-awaited national mineral policy, 2008 and also gave its approval for setting-up an independent dispute resolution mechanism ‘Mining Administrative Appellate Tribunal (MATT). The implementation of the new National Mineral Policy, 2008 is likely to attract Foreign Direct Investment (FDI) of $250 million per annum in the mining sector by the end of five years.
Loan waiver will lead to inflation: Swamy
The Financial Express, March 15, 2008
Janata Party said the farmers loan waiver announced in the union budget would lead to heavy inflation. The Centre could be able to reimburse the money due for banks for the waiver only by printing additional currency, which would lead to heavy inflation, party president Dr Subramanian Swamy told reporters. He asked how the government would provide funds for the waiver of farm loans from tax receipts, when the total tax receipt was only Rs 1 lakh crore.
Telecom to attract Rs 30,000 cr more
Business Standard, March 16, 2008
With new licence holders rolling out services, the Indian telecom sector is set to witness an investment of over Rs 1,30,000 crore in the next two years. This is an increase of Rs 30,000 crore from earlier industry estimates and is affected due to the issuance of five additional licences. Earlier, the Department of Telecommunications (DoT) was to issue a total of 121 Universal Access Service Licences (UASL), the permits to provide telephony services. However, when it completed the allocation by March 5, 2008, a total of 126 new licences were issued.
No aggressive tariff cuts: Bharti Airtel
The Financial Express, March 17, 2008
Bharti Airtel Ltd, India’s top mobile services firm, said on Monday it does not expect to make any aggressive tariff cuts to maintain its share in a market that is becoming extremely competitive. “Looking at the low level of tariffs, we do not expect any significant downward trend,” Akhil Gupta, a joint managing director at Bharti Airtel, said in an interview on the sidelines of a conference in Singapore.
No immediate impact of fuel price hike
The Financial Express, March 17, 2008
The government on Monday said that there was no immediate impact of the hike in petrol and diesel prices on essential commodities. “The data show that there is no immediate impact of the hike in petroleum prices (effected on February 15, 2008) on prices of essential commodities…,” Minister of State for Food and Public Distribution Kantilal Bhuria told the Lok Sabha in a written reply. Bhuria also said it is difficult to precisely segregate the impact of hike in petrol and diesel prices from those of other factors on the prices of consumer items, services and other essential commodities.
Govt may continue ops in 2 state-run airports
The Financial Express, March 18, 2008
India will consider allowing state-run airports in Bangalore and Hyderabad to continue operations along with the new private airports, the civil aviation minister said on Tuesday. On March 12, the Minister told parliament that the government is obliged to close down all commercial civil aviation operations at the existing airports once the new airports are made operational to ensure their financial viability.
SEBI examining alleged insider trading in Reliance Petroleum shares: Govt
The Business Line, March 19, 2008
The Government on Tuesday confirmed in the Rajya Sabha that the Securities and Exchange Board of India (SEBI) was looking into the alleged insider trading activities in the shares of Reliance Petroleum Ltd. “SEBI has informed that it has initiated an examination in the matter”, Mr Pawan Kumar Bansal, Minister of State for Finance, said in a written reply in the Rajya Sabha today.
TRAI move on unwanted calls unfair: Telcos
The Business Line, March 19, 2008
Telecom operators have told the Telecom Regulatory Authority of India that its decision to impose penalty on mobile service providers for unwanted telemarketing calls was unfair. In a joint letter, the Cellular Operators Association of India and the Association of Unified Telecom Service Providers of India, claimed that the operators had no control over the telemarketing agencies and therefore the fine should be imposed on these companies instead of cellular firms.
3G auction will be open to both existing and new operators
The Business Line, March 20, 2008
In a bid to level the playing field between old and new telecom operators, the Department of Telecom has decided that all entities with a unified access licence will be eligible to bid for third generation (3G) mobile licence. This means that companies such as Shyam, Unitech, Videocon, STel and Swan, which recently got new licences, will be able to take part in the auction for 3G services.
Cement consumption bounces back in February
The Business Line, March 20, 2008
The growth in cement consumption has bounced back in February after the monsoon lull. This would see demand exceeding supply in the coming months and buoyant prices, say manufacturers. During the first six to eight months of 2008-09 the supply is bound to be tight with no new additions in capacity expected. From September 2008 onwards some growth in production capacity would happen and the last quarter would see sufficient new capacities in place to match the demand.
Inflation spurts to 10-month high on rising food costs
The Business Line, March 21, 2008
After a lower growth in industrial production and below expectation performance of the infrastructure sectors, inflation data released on Thursday show that it had surged to a 10-month high to come within touching distance of the 6 per cent mark, effectively dousing expectations of an interest rate cut by the Reserve Bank of India. The WPI-based inflation increased sharply on account of an across-the-board spurt in prices, with cereals (6.28 per cent), milk (9.71 per cent), vegetables (9.79 per cent), dairy products (9.31 per cent), cement (5.13 per cent), iron and steel (20.87 per cent) and edible oils (17.52 per cent) showing a big spurt in year-on-year price levels.
Review Tata, Virgin deal, GSM players urge DoT
The Business Line, March 21, 2008
GSM operators have urged the Department of Telecom to reinvestigate the deal between Tata Teleservices and Virgin Mobile for a possible violation of the Foreign Direct Investment (FDI) norms. In a communication to DoT, the Cellular Operators Association of India said that rules regarding Mobile Virtual Network Operators should be made clear and no operator should be allowed to take a back-door entry into the telecom sector. The DoT had earlier given a clean chit to the Tata-Virgin deal.
Dearer food: No let-up in commodity prices
The Business Line, March 22, 2008
The Government measures to tame the rising commodity prices seem to have little impact as prices of some of them such as chana, yellow peas, masoor, turmeric, refined soya oil and mustard oil have jumped more than 10 per cent in the last three months. Other commodities such as sugar, wheat, maize and guarseed also followed the rising trend.
DoT warns Blackberry service providers
The Financial Express, March 24, 2008
Having come under scanner for security lapses in the use of Blackberry services, the government has issued a stern warning to telecom Companies to put the required security system in place within 15 days or stop the services. The directive has been issued to the respective service providers to work out with officials of Blackberry licensor Research in Motion (RIM) of Canada to provide full-proof security system in the country, senior officials in the Department of Telecom (DoT) said.
IRFC monopoly to end with new wagon leasing plan
The Economic Times, March 26, 2008
Railway minister Lalu Prasad’s new wagon leasing policy allowing private Companies to own and lease wagons is likely to result in global transportation majors making a beeline for the Indian entry. This is the next step towards larger private participation in rail freight business in the country. The policy is also likely to give a big push to the wagon leasing market in the country. Market sources said transportation majors like Srei Infrastructure, GE and Mitsui were eyeing entering the Indian market in partnership with the Railways.
Concern over Reliance m ove on petrol pumps
The Business Line, March 27, 2008
The Petroleum Ministry has said that the decision by private sector oil retailer Reliance Industries Ltd, to close its petrol stations over denial of subsidy on par with public sector retail companies, could be a cause of concern. While stating that no one has approached him demanding subsidy, the Petroleum Minister, Mr Murli Deora, on Wednesday said that dealing with the situation was not easy.
Telecom operators may lower tariffs
The Business Line, March 28, 2008
The Telecom Regulatory Authority of India has decided to phase out Access Deficit Charge (ADC) from April 1 onwards. While private telecom operators stand to collectively save around Rs 750 crore next fiscal as a result of the move, the impact at the consumer end is projected to be just a marginal lowering of tariffs.
NTPC exempted from equity cap norms for bidding
The Business Line, March 28, 2008
In a move that could provide greater operational flexibility for power major NTPC Ltd, the Centre has exempted the State-owned utility from the Rs 1,000-crore investment cap in firming up joint ventures or setting up subsidiaries to bid for power projects. The Cabinet Committee on Economic Affairs on Thursday gave its nod to waive the ceiling for equity investment by NTPC to establish financial joint ventures and wholly-owned subsidiaries in India or abroad for participating in bidding called by state utilities and distribution licensees, an official Government spokesperson said.
Govt pulls out all stops to fight inflation
The Financial Express, March 28, 2008
With inflation moving toward seven per cent, the government has begun pulling out all stops to boost domestic supply situation by withdrawing incentives on export of at least 40 items, including steel, cement and non-basmati rice. In a concerted action involving the ministries of Finance, Consumer Affairs and Agriculture, the Commerce Ministry withdrew or temporarily suspended the tax refund scheme – Duty Entitlement Pass Book – late last night.
Govt will weigh lower growth to contain inflation: Chidambaram
The Business Line, March 29, 2008
Expressing concern over high rate of inflation, the Union Finance Minister, Mr P. Chidambaram, said here today that the Government will soon decide whether it should sacrifice a bit of growth to contain inflation. Eight per cent economic growth and four per cent inflation would be the ideal balance. Speaking at the valedictory function of the Indian Merchants Chamber’s centenary celebration, Mr Chidambaram said “fiscal measures to contain inflation have been taken in the Budget, monetary steps will be taken by the Reserve Bank of India and on the supply side the Agriculture Ministry has an important role to play.”
Real(i)ty check on prices under way
The Business Line, March 30, 2008
A price correction of 10-15 per cent is slowly happening in the realty sector across the country though it is area-specific in cities. While realtors point to various factors for the downtrend, developers blame skyrocketing land prices. Others tend to point fingers at a demand-supply mismatch and investor disenchantment. “Though a definite correlation cannot be established between the stock market and the price drop, investors/speculators are exiting the realty space,” says Mr Pankaj Renjhen, Managing Director, Jones Lang LaSalle Meghraj, Mumbai.
States oppose new mineral policy, seek joint task force
The Business Line, March 30, 2008
Five mineral-producing States have told the Centre that the National Mineral Policy 2008 intrudes into their rights over the minerals produced in their respective States and have demanded the setting up of a joint task force with representatives from the States and Centre to look into the issue. The policy was tabled in the Rajya Sabha last week.
Spectrum auction likely in smaller chunks of 5 Mhz
The Business Line, March 31, 2008
In a bid to allow more operators to enter the wireless broadband space, the Department of Telecom is considering auctioning spectrum in smaller chunks of 5 Mhz instead of the earlier suggested 10 Mhz. As DoT has about 80 Mhz spectrum for this segment, it could mean as many as 20 operators using technologies such as WiMax can enter the fray, offering consumers a wider choice of tariffs and schemes. Auctioning smaller bandwidths may also bring in additional revenues for the Government during the bidding process.