Rush to scrap policy on auto MoUs
Bevy of beauties at Delhi car show
Mahajan hints at hardware duty sops
CSE gears up for derivatives
Bengal not to buy Koel Karo power
Agrani advances phone launch date to 2001
Business briefs

New Delhi, Jan. 9 
The government is close to scrapping its MoU policy for the automobile sector in a move that could lead to unconditional import of vehicles and components ahead of the April 2001 deadline set by the World Trade Organisation (WTO).

The new policy regime is expected to be incorporated in the new Exim Policy to be announced on March 31. However, companies which follow the existing MoU conditions will be asked to fully comply with their present obligations before switching over to the new dispensation.

The government has attracted investments worth Rs 11,852 crore (around $ 2.5 billion) into the country so far which includes foreign equity to the tune of $ 1 billion.Onthe other hand, exports of vehicles and components by these firms are valued close to Rs 400 crore.

Commerce ministry officials say the MoU policy, which stipulates a 70 per cent indigenisation target within five years, was justified in the context of investment made by auto majors.

It helped the country�s automobile industry achieve healthy indigenisation and ancillarisation levels in foreign cars manufactured locally.

However, the policy has been under a cloud from the beginning since it runs counter to WTO�s agreement on trade related investment measures (Trims).

Also, many cars manufacturers have not been meeting their export obligations despite signing MoUs with the government.

The first MoU policy was announced in 1995, which was revised in 1997 to allow companies a longer period to meet indigenisation targets.

The government had three options: Either allow free import of CKD/SKD kits, ban such imports or adopt the middle path of allowing the import of CKD/SKD kits subject to setting up of a manufacturing facility in the country. The government ruled out the first two, and chose the last option.

So far, India has signed 11 MoUs. They include: Honda Siel, Fiat India, Ind Auto, Daewoo Motors, Mercedes Benz, Mahindra Ford, Hindustan Motors, General Motors, Toyota Kirloskar, Maruti Udyog and Skoda (yet to start).

Even though Hyundai has not signed an MoU, officials say it has achieved an indigenisation level of 70 per cent.

According to figures made available by the industry, Honda has indigenised up to 71 per cent, Cielo 71 per cent, Opel 69 per cent and Uno 71 per cent.    

New Delhi, Jan 9 
The country�s leading automobile manufacturers will flaunt their latest models at the Delhi Auto Show, to begin later this week.

Market leader Maruti Udyog Limited will parade all the existing cars in its stable, including the newly launched Wagon-R along with Suzuki-2, a two-seater concept car.

Also on the ramp from the auto giant will be the upgraded M-800EX and M-800DX, equipped with multi point fuel injection system (MPFI) so essential for Euro-II cars, the Esteem LX, Gypsy King and the recently unveiled Baleno.

Maruti will also display the carry pick up, carry refrigerated van, Omni XL, and the Grand Vitara.

Korean giant Hyundai will showcase Santro, while fellow chaebol Daewoo will exhibit Matiz with both the companies pitching their small cars as the vehicle for the millennium. The two companies are also displaying their mid-size cars � Nubira and Leganza in Daewoo�s case � along with a concept model in each segment. Daewoo will also unveil its eco-friendly compressed natural gas (CNG) gas-based Cielo.

Ford will tom-tom �Josh Machine�, the Ford Ikon, while General Motors will plug Corsa, its mid-sized car for the high end segment, along with a variant. Another recent entrant in the mid-size segment, Fiat�s Sienna, is also set to vie for attention at the show.

Japanese giant Toyota will flex its muscles with Qualis � the company is advertising the car�s features as akin to a sumo wrester � while Mahindra and Mahindra will be there with its trendy Quadro, targeted at adventure lovers. It will also display Bijlee the eco- friendly, battery-operated, zero emission vehicle.    

New Delhi, Jan 9 
The minister for information technology, Pramod Mahajan, today indicated the Union budget for 2000-1 will have duty sops for the computer hardware sector, as recommended by the task force on information technology.

In addition, a Bill to strengthen the powers of the Telecom Regulatory Authority of India (Trai) will also be introduced in parliament in the latter half of the budget session, the minister said at the Partnership Summit 2000 organised by the Confederation of Indian Industry.

Mahajan said the Centre has written to chief ministers of all states to reduce the sales tax on hardware items to the minimum possible level, to help develop the sector. �I have written to all state chief ministers to follow a minimum sales tax regime for IT hardware products.��

He said he favours the use of internet through cable networks and asked chambers to work with cable operators in this regard.

On the Information Technology Bill, which has been tabled in parliament, Mahajan said he was open to suggestions on changes in the Bill and sought opinions from trade organisations, industry bodies and individuals.

He said the information technology ministry has been created to facilitate the industry, adding that all recommendations given by the IT task force will be implemented by the year end.

Mahajan said the recommendations on the hardware industry will be implemented in the next three months. He was responding to Infosys chairman N. Narayana Murthy�s observation on the non-implementation of the IT task force�s report despite being submitted more than a year back.

However, Murthy�s demands on sops to software export and easier acquisition norms overseas will have to be sent to the finance ministry, Mahajan added.

Earlier inaugurating the partnership summit, external affairs minister Jaswant Singh said India will chart out its own course in the globalisation process as no system in the world could work without answering the demands of the poor.    

Calcutta, Jan 9 
Millennium, the Colombo-based computer major, will give a presentation on Monday to the Calcutta Stock Exchange on the technological aspects of derivatives trading.

�The firm will give a presentation on software, hardware and networking aspects required for derivatives trading,� said Vijay Kamani, one of the three members appointed by the CSE Business Development Committee to implement derivatives. trading.    

Calcutta, Jan 9 
West Bengal has decided against buying power from NHPC�s proposed 710-MW Koel Karo hydel power project in Bihar, saying it cannot afford the high power tariffs � a staggering Rs 8 per kilowatt hour according to Union power ministry estimates � likely to be fixed to meet the high costs of implementing the long-delayed plan.

Bengal has told NHPC that its tariff estimate compares poorly with Rs 2.7 per kwh at the state�s own 900-MW Purulia Pump storage project. Since the high cost will certainly be reflected in the price of power generated at the project, the West Bengal government decided it would stay out.

Of the 710 MW, Bengal was supposed to be allotted 200 MW, while the balance would be set aside for Orissa, Sikkim and Bihar. The Koel Karo project is included in Power Perspective report-2012, a document which makes projections on the state�s power-availability situation over the next 12 years.

Drafted by a government-appointed high-level committee headed by former WBSEB chief Badal Sengupta, the report has already been submitted to the state government.

Koel Karo�s 200 MW would have been supplied to the state in 2006-7. In spite of its availability, the report had indicated the state would face a power shortfall of 1,246 MW that year.

With power purchases from Koel Karo having been ruled out, there are fears the shortfall will climb to 1,500 MW in 2006. This will force it to consider taking up a third hydel project of 900 MW at Katla Jal in the Purulia hills. With a thermal power project of 500 MW also in place, the state�s power availability can then be raised to a safe level, ministry sources said.

�The Purulia pump storage project will be commissioned in 2005 at a much lower cost. Therefore, it hardly makes any sense to buy expensive power from NHPC�s Koel Karo project. A viability study of Katla Jal is being made and developing it will help the state prevent shortages. The 600 MW Turga project is already under consideration and is included in the Power Perspective Report-2012,� a source said.    

Mumbai, Jan 9 
The Subhash Chandra-promoted ASC Enterprises Ltd has advanced the launch of its Agrani project to 2001.

This will be done by taking space on lease from other satellites, negotiations for which are underway.

While telecom circles are abuzz with rumours that ASC would employ the satellite of ICO Global Communications � of which Chandra is a co-promoter � company officials preferred not to comment on the possibility such an arrangement.

Officials, however, did confirm that ASC was looking at the possibility of leasing out space from existing satellites.

�Several satellites like Aces and Thuryan also have an Indian coverage. Though things have not yet been finalised, we might consider leasing out space from one of them,� an ASC official said.

He added that such a tie-up would enable it to commence its services in 2001, ahead of the scheduled date of 2002, when the company�s own satellite is expected to be ready.

This will allow ASC to have a distribution network in place, prior to the actual commencement of operations.

�We will thus get a sufficient lead-in time before we shift to our own satellite,� he stated.

The Agrani project will provide mobile communication services not only to users in India, but also in neighbouring countries like Nepal, Bangladesh and Bhutan.

The project will also encompass a KU band facility which would enable direct-to-home transmission. ASC officials said the band will allow the transmission of television signals which would be in sync with Zee Telefilms� operations.

Sources said financial closure for the project, which has been kept in abeyance for quite a while now, is expected to be completed by the first quarter of this year.

Agrani, which is a regional multi-mission geostationary satellite system, is awaiting the nod of financial institutions (FIs) for a disbursal of around Rs 125 crore. This is expected to take the total contribution of FIs and banks, who have already committed around Rs 1,275 crore, to over Rs 1,400 crore in the Rs 3,170 crore project.

Chandra has pumped in around $ 80 million of his total investment of around $ 120 million, in the $ 755 million project. The rest of the promoters contribution will be accounted for by Videsh Sanchar Nigam Ltd (VSNL), and Lockheed Martin, which will both invest $ 50 million each.    


Inflation rate down to 2.93%

New Delhi: After equalling a 10-week high of 3.13 per cent last week, the inflation rate drifted below three per cent to 2.93 per cent, for the week ended December 25, 1999. The 0.20 percentage points fall in the rate of inflation to 2.93 per cent (provisional) as against 3.13 per cent (p) in the previous week, was due to a decline in prices of commodities across all the three categories under the wholesale price index (WPI).

Pollution order

New Delhi: In a major decision, the Delhi government has lifted the closure of 372 industrial units, which were earlier sealed by it following a Supreme Court directive against industries polluting the Yamuna.

FIIs net sellers

Mumbai:Foreign institutional investors (FIIs) proved to be net sellers to the tune of over Rs 365 crore, in the first week of the new year ended January 6. Though FIIs began the year on a positive note, they turned net sellers in the following two days closing the week with net sales of Rs 367.6 crore ($ 84.5 million), according to figures with the Securities and Exchange Board of India.

Sidbi fund

New Delhi: Riding the infotech boom, the Small Industries Development Bank of India (Sidbi) has decided to launch a $ 50 million (about Rs 225 crore) international venture capital fund, for financing Silicon Valley start-ups.

Hepatitis vaccine

Calcutta: A new generation recombinant Hepatitis B vaccine has been launched by Biological E, a Hyderabad-based company.

Elysium Pharma

Calcutta:Elysium Pharmaceuticals Limited is planning to set up production facilites in the state. It specialises in ethical and veterinary formulations.    


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