India can become a better place for doing business: IFC

India can become a better place for doing business: IFC

New Delhi: The private sector lending arm of the World Bank, International Finance Corp. (IFC), on Thursday said India can greatly improve its business environment if the best practices, currently followed only in some cities, can be replicated across the country.

“India can jump 55 places if best regional practices (in 10 business areas) are adopted nation-wide," IFC’s chief economist Michael Klein said at a panel discussion on the ‘Doing Business 2008 Report’ of the World Bank.

India is currently ranked 120 in the Doing Business Index.

The report pointed out that best domestic practices in the area of launching a business exists in Jaipur, dealing with licences in Bhubaneswar, registering property in Hyderabad, paying taxes in Bhubaneswar and Chandigarh, trading across borders in Chennai, enforcing contracts in Bhubaneswar and closing a business in Bangalore. These practices, if adopted by the entire nation, would significantly improve the business environment in India, he said, adding that the country’s ranking in 2008 survey went up by 12 places to 120.

Klein further said that many countries have been focusing on the reforms relating to starting a business, but were often found wanting in taking up labour reforms for fear of a political fallout.

Tax reform, he said, was the second most popular reform agenda among nations as it helped the industry as well as the exchequer by increasing compliance and improving realization.

Pointing out that reforms create growth potential and attract investments, Klein said, “China, India and Vietnam will keep reforming and create lot of business opportunities".

In the area of enforcing contract, India ranked 177 out of 178 nations, the report said, adding that it takes almost four years to resolve a commercial dispute through courts in Mumbai, compared with slightly over a year in Shanghai. Similarly, it takes 10 years to go through bankruptcy cases in India, against less than two years in Shanghai.

ONGC to shut down 2 facilities for hook-up

New Delhi: State-owned oil exploration firm Oil and Natural Gas Corp. Ltd (ONGC) will shut down two key facilities at its largest gas field off Mumbai in January and February, that will cut output by one-third.

ONGC plans to shut down two production complexes at the Bassein field to hook up new facilities leading to a fall in natural gas availability from 42 million cu. m per day (mscmd) to 29-31mscmd, a company official said.

The company will shut BPB process complex from 1 January to 25 January and BPA complex from 14 February to 28 February.

ONGC has invested Rs2,937 crore in additional development of the South Bassein field and another Rs1,688 crore in the Vasai East field.

Against the current production of 42mscmd, gas supply is expected to be in the range of 29-31mscmd during the shutdown period. PTI

Rehab, land acquisition Bills introduced in LS

New Delhi: The government on Thursday introduced the Rehabilitation and Resettlement (R&R) Bill, 2007, the Land Acquisition (Amendment) Bill, 2007, in the Lok Sabha, and another Bill in the Rajya Sabha to ensure that elderly parents and senior citizens are looked after by their next of kin.

While the Maintenance and Welfare of Parents and Senior Citizens Bill, 2007, was cleared by the Lok Sabha in March, the rehabilitation and land acquisition legislations are yet to be debated in Parliament. Both Bills were introduced a day before expected, but with the current session of Parliament scheduled to end on Friday, they are unlikely to come up for detailed discussion in the Lok Sabha.

The R&R policy was proposed in the wake of protests in several states, including West Bengal, against eviction of land users and owners from their land for industrial projects. The new Land Acquisition Bill is meant to replace an earlier act of 1894 that aims to reduce the burden of land-related cases in the courts of law and makes land acquisition time-bound.Pragya Singh

Institute of nanoscience to come up in Bangalore

Bangalore: Under the Rs1,000 crore (2006-2011) Indian Nanotechnology Mission, the first Indian Institute of Nanoscience and Technology is being set up in Bangalore with Rs100 crore grant from the Centre. It will be followed by two other centres in Kolkata and Mohali.

This was announced by the chairman of the scientific advisory council to the Prime Minister C.N.R. Rao at the inauguration of Bangalore Nano 2007, an event that will become an annual feature on the lines of and Bangalore Bio.

The Centre has also instituted an annual Bangalore Nano National Excellence Award, which was conferred on Rao on Thursday. Seema Singh

Spectrum issue: 19 MPs seek PM’s intervention

New Delhi: Pressure is mounting on GSM mobile operators to return “surplus" spectrum, with several lawmakers belonging to various political parties now seeking Prime Minister Manmohan Singh’s intervention to ensure that these airwaves are given to players waiting to start services.

“For the sake of fair competition, consumer benefit in terms of lower tariff and better services, it is imperative that the government allows new players in the cellular mobile sector," a letter signed by 19 members of Parliament said. The parliamentarians have supported the recommendations of Telecom Engineering Centre and Telecom Regulatory Authority of India, saying their technical capabilities are second to none.

The main GSM operators have questioned these recommendations for the sole purpose of retaining their hegemony, they said.PTI

Higher interest rates may crimp India growth

New Delhi: The country’s economic growth may slow over the next three years as higher interest rates curb consumer demand and a stronger currency make exports less competitive, the Organisation for Economic Cooperation and Development (OECD) said.

Asia’s third biggest economy is expected to expand 8.8% in the year to March 2008, 8.6% in the following 12 months, and 8.4% in the year through March 2010, the Paris-based OECD said in a report on Thursday. Growth was 9.4% in this fiscal year.

India’s economy expanded 8.9% in the three months to 30 September from a year earlier, the slowest pace since the final quarter of 2006. Growth was 9.3% in the previous quarter. .

India’s central bank expects growth in the year to March 2008 to ease to 8.5% after it raised interest rates nine times since 2004. The reverse repurchase rate is now at a five-year high of 6%. Growth will also be impacted by the rupee’s more than 12% appreciation against the dollar this year. “The current account deficit is likely to widen to 2% of gross domestic product by the fiscal year 2009 from 1.1% in fiscal year 2006, OECD said. Bloomberg

Robert Bosch to invest Rs850 crore in India

Mumbai: The world’s largest auto-parts maker Robert Bosch GmbH, plans to invest Rs850 crore in India by 2010.

The company, which plans to raise total India investment to Rs2,650 crore, expects sales in India this year to increase 20% to Rs4,700 crore, Robert Bosch said on Thursday.

The investment will be made in engineering and manufacturing facilities “to be set up for gasoline systems and electronic control units," it said.Bloomberg

Omaxe pledges 14% stake with Indiabulls

Mumbai: An Indian developer of offices and houses, Omaxe Ltd, said it pledged 25 million shares with Indiabulls Financial Services Ltd as collateral for a three-year loan to finance a land acquisition.

The New Delhi-based developer raised Rs300 crore pledging 14% of its shares with Indiabulls, Arvind Parakh, Omaxe’s chief executive officer for strategy and finance, said in a phone interview from New Delhi. The developer has the right to repay the loan within six months.

“We have some land-acquisition- related opportunities coming up," Parakh said. “It’s an opportunity-driven transaction."

Omaxe’s stock, which rose as much as 5.4 %, ended at 482.05, up 12.2%, on the Bombay Stock Exchange on Thursday. Bloomberg

India tests interceptor missile successfully

Bhubaneswar: The country staged a successful missile intercept test over the Bay of Bengal on Wednesday after thousands of people were evacuated ahead of the exercise, a defence official said.

The Advanced Air Defence (AAD) missile intercepted a modified version of the surface-to-surface Prithvi-1 missile, said a defence official who spoke on condition of anonymity.

“The test was successful," said another defence official associated with the test. The weapons were fired from the Chandipur-on-Sea and Wheeler Island testing sites in eastern Orissa.

More than 5,000 people were evacuated from the Chandipur-on-Sea launch site ahead of the test, officials said. The AAD is a new interceptor missile developed by the Defence Research and Development Organisation.AFP

Muhtar Kent to succeed Isdell as Coca-Cola CEO

Coca-Cola Co said on Thursday chief operating officer Muhtar A. Kent will succeed Neville Isdell as chief executive of the world’s largest soft drink company on 1 July.

Isdell, 64, who was brought out of retirement in 2004 to lead a turnaround at Coke, will remain chairman until the company’s annual shareholder meeting in April 2009.

Kent, who joined the Atlanta-based company in 1978 and will remain its president, helped orchestrate the acquisition of vitamin-water maker Glaceau earlier this year, and is given credit for Coke’s strong volume and double-digit earnings growth so far this year.

A native of Turkey, Kent, 55, has been the clear heir apparent for well over a year, according to John Sicher, editor and publisher of industry newsletter Beverage Digest.

“It makes perfect sense. Kent is very highly regarded throughout the Coke system and has virtually spent his life preparing for this job," Sicher said. “It’s also a positive having Isdell stay on as chairman because it will make for a very good and smooth transition."

Sicher said the company has two challenges ahead: to keep the international business growing and to turn around the business in North America. “Both are at the top of Kent’s priority list," Sicher said.

Coca-Cola, like PepsiCo Inc, has suffered a domestic slowdown in sales of its traditional soft drinks as health-conscious consumers opt for bottled water or tea, which they view as healthier. Strength in emerging markets, such as Russia, India and China, has helped offset this weakness.Martinne Geller Reuters

Coleman in talks with Indian retail firms

New Delhi: US-based Coleman, the maker of outdoor leisure products such as backpacks, furniture and barbecues, is in talks with large Indian retail companies for distributing its products, besides French retailer Carrefour.

“We are in talks with the companies which are yet to start retail operations in India, but our future plans are not yet finalized," Coleman export manager Michael Strophair said, without naming the retailers the company is talking to.

A Coleman official said the company also expects its products to find shelf space in stores of Carrefour when it enters the Indian market. Carrefour, which sells Coleman products in its stores globally, has said that it would launch retail operations in India by 2009 through the franchise route. PTI

India cancels $600 mn Eurocopter agreement

New Delhi: The government on Thursday scrapped a $600 million (Rs2,370 crore) deal to buy 197 military helicopters from Eurocopter, the helicopter arm of the European Aeronautic Defence and Space Co. (Eads), after allegations of corruption in the bidding process.

“The government has decided to cancel the RFP (request for proposal) for 197 helicopters for the army. A fresh RFP will be issued soon," defence ministry spokesman Sitanshu Kar said.

A fresh tender will be issued early in the new financial year, an official of the policymaking defence acquisition committee said. The deal was awarded to Eurocopter, which makes civil and military aircraft, in February. AFP

Mauritian firm buys 6.8 mn shares in Havells

Mumbai: Global equity firm Warburg Pincus has acquired more than 6.76 million securities in electrical and power distribution equipment company Havells India Ltd for Rs439.40 crore.

The company has issued 4.16 million equity shares and 2.6 million convertible warrants to Seacrest Investment, a Warburg Pincus group company, Havells India said in a filing to the Bombay Stock Exchange (BSE).

The company would utilize the funds to partly retire debt raised by it earlier this year to acquire Dutch firm SLI Sylvanias lighting business, and use the rest in enhancing manufacturing capabilities. Havells India said it has appointed Niten Malhan as an additional director of the company with immediate effect. Shares of Havells India ended at Rs656.35, down 0.60%, on BSE. PTI

Cabinet nod for highway programme phase VII

New Delhi: The government on Thursday cleared an investment of Rs16,680 crore for the seventh phase of the expansion under the National Highways Development Programme.

Of this, Rs10,378 crore is expected to come from the private sector. An official announcement to this effect was made after the Union cabinet’s economic affairs committee that met here.

This is the most expensive phase of highway construction in the country, with an investment of Rs15 crore to be made for every kilometre over a 700km stretch across the country, about three times more expensive than the usual cost of building highways.

Of the total investment, Rs10,500 crore will be spent on building ring roads and bypasses over 700km alone. The remaining Rs6,180 crore will go into building stand-alone grade-separated intersections, road overbridges, elevated roads, tunnels, underpasses and service roads. The works on ring roads and bypasses are likely to be awarded by March 2011, and likely to be completed by December 2014, an official release stated. Pragya Singh

Finmin in favour of moderate I-T rates

New Delhi: The finance ministry appears to be favourably inclined towards moderating income tax (I-T) rates in view of more than 40% growth in direct tax collections.

“With improvement in voluntary tax compliance and tax administration, direct tax collections are growing by around 45%. For voluntary compliance, we cannot have marginal tax rate that is too high," Parthasarthy Shome, economic adviser to finance minister P. Chidambaram, said at a conference here.

Direct tax collections grew 44.86% during April-November this year to Rs1,45,053 crore.

Sources said the finance ministry is getting representations from political parties and industry chambers to review personal I-T rates, which vary from 10% to 30%, in addition to the 3% education cess and 10% surcharge on I-T, for income above Rs10 lakh. PTI

NTPC, CIL to ink pact for Jharkhand projects

New Delhi:NTPC Ltd and Coal India Ltd (CIL) will sign an agreement soon to float a joint venture special purpose vehicle (SPV) to build two power plants of 1,500MW and develop two coal mines in Jharkhand at an estimated cost of Rs8,000 crore.

“NTPC and CIL will sign a memorandum of understanding (MoU) to float a SPV to build two integrated power plants for Rs7,500 crore and develop two coal mines in Jharkhand at an estimated cost of Rs500 crore. The draft MoU will be given final shape in the coming days," a top coal ministry official said.

He said that both the firms will hold equal equity stake in the SPV, and the power produced from these plants would be commercially sold, mostly through power purchase agreements. PTI

ADB will lend more to India, tap bond market

New Delhi: The Asian Development Bank (ADB) on Thursday said it will enhance funding to India to $3 billion (Rs11,850 crore) annually for the next three years and also raise funds in the country’s bond markets.

“India requires huge investments in the infrastructure sector and 70% of the annual $3 billion would go to sectors like power, roads and rural infrastructure," ADB managing director general Rajat Nag said on the sidelines of the CITI-FT Financial Education Summit, here. ADB currently lends about $2-2.5 billion to India, and beginning 2008, this would be increased to $3 billion, which would be invested through the public sector for infrastructure development.

Nag said it is estimated India would require $1.6 trillion for infrastructure development over the next 10 years. The bank is also in the process of raising money through bonds in fiscal 2009 for investment in India, he said. PTI