Govt dithers on petro goods price hike as allies f
Legislation to protect trade secrets soon
Rhone, AgrEvo in strategic alliance
Infosys opens softwarecentre in Andhra
Industry clocks 9.4% growth in January
US financiers throng chambers with offers
GM’s macro vision hinges on micro car
Foreign Exchange, Bullion, Stock Indices

New Delhi, March 10 
The spectre of a rollback is haunting the ministry of petroleum and natural gas. Though it is ready with the revised prices for liquefied petroleum gas (LPG) and kerosene, an announcement to this effect can trigger a political controversy among the partners of the ruling coalition.

At the same time, if a dent is to be made in the burgeoning deficit in the oil pool account — increasing by Rs 1,200 crore every month and now standing at Rs 6,000 crore — the hike must be significant. The allies, already clamouring for a rollback in the subsidy cuts made in fertiliser and items distributed through the public distribution system(PDS), are bound to resist higher LPG and kerosene prices.

A political initiative by the minister of petroleum and natural gas Ram Naik could have broken the stalemate but he is pre-occupied with other issues at the moment. Naik did lobby for the hikes initially, but threw in the towel mid way. Naik, however, has the option to announce a steep hike, with a cushion to roll it back partially. Alternatively, he could lobby among MPs for a simultaneous hike in diesel prices.

Under a compromise that is likely to emerge, he could defer an announcement on the diesel price hike.

The ruling party at the Centre is facing political difficulties. The government remains committed not to hike the prices of diesel for the time being. However, the relentless rise in the prices of crude in the international market means it cannot be postponed further.

Officially, the price of diesel was linked to international rates in September 1997. Periodic adjustments since then were foiled by the previous petroleum and natural gas minister, Vazhapadi Ramamurthy. Naik, on the other hand, has proposed a hike of Rs 50 for an LPG cylinder and Rs 2 for a litre of kerosene.

It is now almost certain that the government, under pressure from its allies , will modify the hike in prices of fertiliser and foodgrains. Another rollback in the case of petroleum products could be a humiliation.

For a beleaguered Naik, there is no way out. However, in an effort to flare-up in crude prices, he has appealed to Iran, an OPEC member, to convince others in the association that production increases are required to ease prices in the international market. According to diplomatic sources, Naik’s letter argues that abnormally high oil prices could slow down global economic activity — something that could hit both suppliers and consumers.    

New Delhi, March 10 
The government is drafting a Bill on undisclosed information that will punish employees, or others, of a company for disclosing trade secrets and confidential information.

“The legislations should have been in place by January 1, 2000. We are behind schedule,” C.T. Benjamin, secretary, department of industrial development, said at the second annual general session of the Institute of Intellectual Property Development (IIPD).

Benjamim said the Trade Marks Bill and the Geographical Indications Bill, which have been passed in Parliament, were prepared by his department.

Another Bill on design has already been passed in the Rajya Sabha and is now in the Lok Sabha for consideration.

Benjamin said his department is currently preparing the draft on two more legislations including the one on undisclosed information. The government has ensured that these bills were compatible with Trade Related Intellectual Property Rights Agreements (Trips) by incorporating all its basic stipulations. The objective of Trips is to protect the ideas of inventors and the product of manufacturers.

Benjamin said Trips is essential to create a sound industrial property system that encourages invention, innovation and new development. He said Trips would herald a regime in which the members of the World Trade Organisation would have to provide measures for protecting intellectual property rights and their enforcement.    

Mumbai, March 10 
Two of India’s crop protection majors, AgrEvo India Ltd and Rhone-Poulenc Agrochemicals India Ltd, today announced a strategic alliance under the aegis of Aventis CropScience world-wide.

The alliance, which comes into effect from April 1, takes them to the top league of the crop protection business in India with a combined market share of 14 per cent, resulting from cost and growth synergies, combined distribution strength and a greater market penetration for their key brands.

Aventis also launched Ezeetab, an insecticide in an agricultural tablet form. This is the first time that such an insecticide formulation isintroduced in the country, with manufacturing facilities for the same being set up here as well.

At a press conference to announce the AgrEvo-Rhone-Poulenc strategic alliance, Jan Stranges, member of the executive committee, crop protection business line, Aventis CropScience Lyon, said, “Aventis CropScience is a major crop production and crop protection company committed to the development of sustainable agriculture globally with a focus on research, development and marketing innovations.”

The Aventis CropScience group in India currently comprises four entities held variously by Aventis CropScience Holding SA Lyon — AgrEvo India Ltd (50.1 per cent), Rhone-Poulenc Agrochemicals (India) Ltd (a 100 per cent subsidiary), Bilag India Limited (51 per cent) and ProAgro Seeds (98 per cent). AgrEvo India will be renamed Aventis CropScience India Ltd from April 1, 2000.

“The new outfit will be a company with the creative and financial capacity to develop, improve and implement revolutionary ideas. Biotech will be our focus for growth in future and we will continue to grow through acquisitions of seed companies,” he said.

Amongst the Asian countries, India figures prominently on the growth opportunity front. “India is expected to play a key role in demonstrating the value of crop protection techniques, which means bringing all farm inputs, namely seed, crop improvement and crop protection technology on a single platform,” said Karl-Peter Schlicting, regional head, Asia-Pacific, Aventis CropScience.

“Aventis CropScience will interact closely with its 2000-strong distributor network and key farmers in the growing segments,” said V Sagar Kaushik, country head, Aventis CropScience. “The company will have a large production base for synthesis of active ingredients, as well as new and safe formulations at Ankleshwar, Gujarat. Ten new innovative and eco-friendly formulations will be launched shortly.”

Further, the Ankleshwar manufacturing facility will be one of the four global sourcing points for the company.    

Hyderabad, March 10 
Infosys, the Rs 512.74 crore infotech giant, is opening a major software development centre in Hyderabad. State IT department officials say chief minister N. Chandrababu Naidu has persuaded Infosys chief N.R. Narayanamurthy to set up a centre in the Cyberabad . “They have taken a 3,50 square feet module in Cyber Towers at the Hitec City. Almost all the infrastructure is in place and they might start clicking from Monday,” said a senior official of the state government.

Over 50 software engineers from Bangalore have been shifted to the start-up unit at Hyderabad. “It will carry out all the development works of the Bangalore centre and ensure value addition to some of the products,” said an Infosys spokesman. Narayanamurthy’s aides contend that the Hyderabad centre will grow into a large unit with 500 engineers within two years.

The Andhra Pradesh government has also offered a 50-acre plot of land to Infosys to expand the centre. “They have shortlisted three locations and will pick one soon,” said a state government official.

The Andhra government had taken initiative to involve IT professionals in the state IT promotion committee aptly named as “AP first”. Naidu has inducted IT bigwigs like Narayanamurthy of Infosys, Azim Premji of Wipro, F.C. Kohli of TCS and Dewang Mehta of Nasscom to formulate an infotech policy for the state. Naidu has also constituted an IT promotion board to persuade infotech units to move to Andhra.

Narayanamurthy has been in touch with Chandrababu Naidu over the past four months and has guided the state IT department in formulating a policy for start-ups and internet service providers (ISPs) coming up in the state.

Infosys is the second Bangalore IT giant to set up shop in Hyderabad. Earlier, Wipro had set up a centre over 50,000 square feet adjacent to Cyber Towers. This was after Hyderabad lost Sun Microsystems to Bangalore in 1999 when there was political uncertainty in the state.

The Andhra government is planning to a slew of concessions to software units in the state. The Naidu government has already announced a major sales tax reduction for the IT industry. Sales tax on any IT equipment is only 3.5 per cent and the earlier tax on turnover of one per cent has also been withdrawn.

Almost 300 new companies have registered themselves with the Software Technology Park of India, Hyderabad to avail the central budgetary concessions for companies established before March 31.

The Andhra government has also set up an venture capital fund - Hitvel (Hyderabad IT Venture Enterprises Ltd) — for IT startups with a corpus of Rs 20 crore. To promote connectivity, the Naidu government has embarked on a programme to lay optic fibre cables along all the state high ways.    

New Delhi, March 10 
Indian industry has recorded an impressive 9.4 per cent growth rate in January as against 5.2 per cent in the same month last year.

The Index of Industrial Production (IIP) during April-January 1999-2000 was nearly double at 7.2 per cent, compared with a low 3.8 per cent in the corresponding period last year.

This is in keeping with the Confederation of Indian Industry (CII) projections of an industrial recovery released yesterday which stated that 51 key sectors of the Indian economy had clocked a growth rate of more than 10 per cent during the first 10 months of the current financial year.

The growth has been mainly because of a double digit growth in the manufacturing sector which accounts for more than two-thirds of the total weightage in the IIP. According to the Central Statistical Organisation figures, the manufacturing sector recorded an 11.4 per cent growth in January, as against just 5.9 per cent in the same period last year.

Even cumulative growth in the manufacturing sector has doubled during the first 10 months of the current fiscal at 8 per cent, as against 4.1 per cent in the previous fiscal. However, the mining sector continued to post negative growth rates in January and stood at 1.2 per cent as against 3.3 per cent in the previous corresponding period. Also, the capital goods sector posted a negative growth rate of 2.8 per cent as against a positive growth rate of 16.9 per cent in the same period last year.

Electricity also recorded poor growth rate at 1.8 per cent in January as against an impressive 7.5 per cent in the previous fiscal. Considering the cumulative trends in these sectors, growth in the mining sector for the April-January period was static, compared with a negative 1.1 per cent during the same period last year.    

New Delhi, March 10 
A host of high-profile financiers and government agencies from the US are converging on India’s chambers in the days leading up to President Bill Clinton’s visit to explore business opportunities, identify big-ticket projects for possible investments and pick industries for technology transfers.

Days after the US Exim Bank chief wrapped up his India tour, the US Trade and Development Agency (TDA) director Joe Grandmaison and Overseas Private Investment Corporation (Opic) director Carl Reinhardt tempted local business leaders today with offers of grants worth $ 3.5 lakh, apart from providing assurances on technical training and orientation programmes for small and medium enterprises (SMEs).

“The Exim Bank, TDA and Opic are here to cash in on the enthusiasm that the visit has generated in India. We don’t want the euphoria to fizzle out after the President leaves. We expect concrete follow-up actions on business proposals and agreements,” Grandmaison told Ficci members. He said his organisation had drawn up a list of 40 energy projects it could finance in south Asia — 24 of which are in India.

Reinhardt said he was ready to fund a wholly owned subsidiary or a joint venture in which Opic could hold 25 per cent.

At the same time, he said picking up equity in a project would not be a limiting factor, and that his agency could still fund the full project. The range of the investments could be $ 1 million to $ 200 million.

Grant for Hinduja firm

In a development that has significant implications for the local cable industry, the US Trade & Development Agency (TDA) has extended a grant of $ 2,18,950 to Hinduja group company IndusInd Media Communications (IMC) to support a feasibility study for an internet-over-cable project.

The study will assess and map out the development of high-tech infrastructure used to provide internet access and data communication through cables lines.    

Calcutta, March 10 
General Motors (GM) Corporation may develop a micro car, one that is smaller than Maruti 800, for India, China and other countries of south-east Asia. The auto giant is also looking for an Indian partner with whom it could forge joint ventures to develop automobile technology.

Richard. C. Swando, managing director of General Motors India, who was in the city to launch the New Astra 2000 and Corsa, said the two global task forces that recently toured the country will submit their reports on the market potential for both ventures.

“We want to expand opportunities in the Indian market. The team on technology was here to explore opportunities for joint ventures in the areas of battery technology research, fuel cells, software development, electronic engineering. It came here to gauge the prospects of a micro car but also studied the transportation needs of India and other countries in the region,” Swando told The Telegraph.

General Motors, ranked eighth in the Asia-Pacific market with a 5 per cent market share, hopes the micro car launch and stronger demand for its other models will help the company emerge as one of the top three car-makers in the region.

However, Swando said his company’s expectations are tempered by the experience of the last two years, during which several companies were roiled in a sales slump. “The negative growth in the last two years has made us a little scared. We want to be careful in a market that is tough and is bristling with companies which extended themselves too far, ” he said. Meanwhile, GM India has received FIPB approval to pump in an additional Rs 180 crore over 12 to 18 months, an infusion that will raise its total investment to over Rs 600 crore.

At the same time, the company intends to capitalise on a slew of brands that it hopes are suited to Indian conditions. Vectra, a large car from the GM stable showcased at the Delhi Automobile show in January, has generated moderate demand. Swando said the auto maker is looking into the possibility of limited imports to meet the demand for the car in India.

The company also plans to introduce Blazer, the multi-utility vehicle currently sold under the Opel umbrella in Indonesia, North America and Europe. In India it will be pitted against Toyota’s Qualis and Tata Safari. Launching a station-wagon version of Corsa for the Indian market is also under consideration. GM India is also looking at the CNG car segment with renewed interest. A prototype has been built and tested in Bombay and Halol while another will soon be tested in Delhi.

Swando admitted Opel, with a market share of 12-13 per cent, is lagging behind Honda City which has wrested a 30 per cent market share. However, he said he expected the combined sales of New Opel and Corsa to catch up with Honda’s by the end of this year.

GM India’s Halol plant broke even with a production of 11,000 vehicles in 1997 but its sales have declined ever since. “We are planning to return to the break-even position this year. The combined single-shift production of Astra and Corsa in March will be 700 units. We hope to push this to 900 per month soon,” Swando said.    

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