Aishwarya Rai to go Indian at Cannes red carpet

New Delhi, May 17 (PTI) She has often been criticised for favouring western couture over Indian ensembles during her much publicised stints on the French Riviera but Aishwarya Rai Bachchan will be seen in a traditional outfit for Raavan''s launch at Cannes. The Bollywood actress, who is one of the best known Indian faces across the globe, has shied away from wearing ethnic outfits ever since her debut at Cannes in 2003, when she was criticised for wearing a green sari.

"Aishwarya is in Cannes for L''Oreal every year as part of the International Dream Team of L''Oreal where on instruction she must wear international western designer wear," the actress'' spokesperson told PTI. But the superstar is all set to don an Indian outfit for the launch of Mani Ratnam''s film ''Raavan'' at Cannes. Aishwarya stars with husband Abhishek Bachchan in the film.

"This time since the ''Raavan'' red carpet is also an occasion, Aishwarya will be wearing an Indian outfit for that which she had already planned," added the spokesperson. The 36-year-old will wear a creation by designer Sabyasachi Mukherjee.

She had earlier chosen a sari by the same designer for her appearance on the Oprah Winfrey Show. "I have given her many outfits for her stint at Cannes this year because she wanted to wear something Indian this time but I am not sure which dress will she be wearing," Sabyasachi told PTI. The actress, who has become a permanent fixture at the Cannes red carpet over the years, has wowed the snappers with her choice of gowns.

She wore a violet tulle and mousseline gown from Elie Saab for the festival opening and for her second outing on the red carpet with fellow L''Oreal spokesmodel Eva Longoria, Aishwarya opted for a black Armani Prive strapless number, which hugged her curves in all the right places. The third day saw her on the red carpet in a pink Gucci gown accompanied by her mother who chose to wear a cream and gold sari.

So far Deepika Padukone is the only Indian celebrity to take the six yard route to style at this year''s festival. She stepped out on the red carpet for the premiere of the film ''The Tournee'' in a cream and gold Rohit Bal creation which she teamed with Kundan jewelery and a stone studded clutch.

Meanwhile Mallika Sherawat has kept a relatively low profile this year with demure fashion choices. She had grabbed headlines with her first appearance at Cannes, when she opted for a plunging golden blouse paired with a slashed skirt as she posed with Jackie Chan for the photocall of their film ''The Myth''.

Her fashion choices again caused a stir when she turned up at the premiere of ''Inglorious Basterds'' in Los Angeles wearing a sheer black gown with her underwear visible.

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Arjun Munda all set to be new Jharkhand Chief Minister

Ranchi, May 16 (ANI): Bharatiya Janata Party (BJP) leader Arjun Munda is all set to be the new Chief Minister of Jharkhand.

Munda's name has been cleared by the BJP central leadership to lead the coalition Government in the State along with the Jharkhand Mukti Morcha (JMM) and the All Jharkhand Student's Union (AJSU).

The BJP has put off the official announcement because of the death of former Vice Presdient Bhairon Singh Shekhawat.

Munda has been asked by the central leadership to ensure support of all JMM lagislators, especially the disgruntled ones for a smooth floor test.

Both the BJP and the JMM have agreed to share Chief Ministership for 28 months each on rotation basis.

The JMM has also accepted the BJP demand to have the first shot at power under the power sharing deal.

Interacting with media here, Munda said: "The coalition between the BJP, the JMM and the AJSU would ensure good governance and find different ways in which a strong government in Jharkhand would work. All formalities regarding this would be completed very soon."

"Our focus would be to fulfil people's wishes and work for their welfare with a common vision, common policy and common programme. All the coalition partners would stay united in purpose," he added.

For Munda it would be the third time to lead the state. He is currently representing Jamshedpur Constituency in the Lok Sabha.

Though Chief Minister Shibu Soren has offered to resign as soon as the BJP finalises its candidate, nothing could be predicted about his intentions.

Even the Congress leadership in Delhi was surprised as to why Soren dumped the BJP to favour Congress on cut motion which led to the turmoil.

The tribal dominated state has seen seven Chief Ministers in nine years with the eighth to take over in a few days time and no one knows when the ninth one will take over. (ANI)


Twitter poses security threat to Tendulkar

Sachin Tendulkar may have endeared himself to his countless fans by joining the social networking site Twitter. But in doing so, the cricketer may have exposed himself to a security risk.

Tendulkar has been using the Uber Twitter application to post his tweets via his Blackberry phone. It may not be known to the cricketer yet, but Uber Twitter has started displaying his exact coordinates --- down to the sixth decimal --- on his Twitter profile.

At 11.30 pm on Thursday, Tendulkar's location was being broadcast to his 169,000 followers as "19.048336, 72.827674" on his Twitter page,

This is to be read as latitude 19.048336 and longitude 72.827674. With a GPS device or even a web-based tool like Google Maps, these coordinates can reveal that Tendulkar, or at least his Blackberry, was at a location near KC Road in Bandra, Mumbai.

Around 2.30 am on Friday, his Twitter location changed, indicating he was heading towards the Bandra-Worli sea link.

In August, Tendulkar along with other Indian cricketers had junked a controversial anti-doping rule from the World Anti-Doping Agency (WADA), which required them to disclose their whereabouts for out-of-competition testing.

They said the code was a breach of their privacy and also posed a security threat.

BCCI's Ratnakar Shetty had said last year: "(India's cricketers) are under security cover so I don't think they can disclose their whereabouts on a daily basis."

Leading sports-persons in the world like Usain Bolt and Rafael Nadal had grudgingly accepted the WADA code, as did the other cricketing nations. But India's cricketers remained the only ones opposed to it.

In the past, there have been threats to the lives of leading Indian cricketers, Tendulkar being the most prominent of them.

India captain MS Dhoni, too, had faced security troubles last year when he received an extortion call in December.

Two years back, Sourav Ganguly said he'd received threat mails saying his daughter would be kidnapped.

Tendulkar can fix this predicament by simply using a Twitter application which doesn't disclose his location.

But should he choose to go off Twitter, it would truly sadden his fans.

Tendulkar joined Twitter on May 4 and within just three days has 184,656 followers and increasing.

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Bajaj car to be world's cheapest

Bajaj's ultra-low cost car being manufactured jointly with Renault and Nissan promises to give hot chase to the Tata Nano. On Monday, Rajiv Bajaj, MD, Bajaj Auto confirmed the $2,500 (Rs 1.1 lakh) price tag for the car, announced first by Renault chairman & CEO Carlos Ghosn at the company's shareholders' meet late last week. The Renault announcement comes a few days after it pulled out of its loss-making Logan venture with Mahindra & Mahindra.

The Bajaj car will be cheaper than the Nano, which comes at Rs 1.23 lakh-1.72 lakh (ex-showroom Delhi ). After the launch of Tata Nano, the race for the No.2 position in the ultra-low cost car segment is under way in India , which as emerged as the Mecca of this segment. However, other automakers' plans to enter this segment are still on the drawing board.

At Renault meeting, Ghosn said: "In India , Renault and Nissan are developing an ultra-low-cost vehicle with the Bajaj group, benefiting from its expertise in light vehicles and knowledge of the Indian market." He reiterated the affordability of the vehicle for the Indian market by citing the targeted low price tag.

"We are combining our strengths with Nissan, notably in India , Russia , Brazil and Mexico ," Ghosn said. "The alliance product strategy has been finalised in India and Russia , and Renault and Nissan will pool their production capacities and platforms there to fully deliver on these developments," he added.

The car was initially scheduled to hit the market this year, but has been postponed to 2012. Bajaj Auto displayed the prototype of the small car at the 2008 Auto Expo. However, the three partners were stuck at various levels of branding and engineering the car till last year. According to industry observers, the project also got delayed as partners were stuck on pricing issues as well. While Renault wanted a low-cost car, Bajaj was keen on a car that would sport high mileage and low maintenance.

It was during his India visit that Ghosn finally announced the finalisation of the project. "As per the agreement, the design, engineering, sourcing and manufacturing will be handled by Bajaj Auto, while marketing and selling will be (done) by Renault-Nissan Alliance," he said. But he had declined to comment on the pricing of the car.

Officials from the alliance have said the car will be smaller than Maruti Suzuki's Alto, which is the biggest selling model in India .

In March, Collin Dodge, executive vice-president, Nissan Motor had said: "It is over two years that Bajaj is trying to produce the car. The physics of it is very difficult. We have not yet found a solution as there are a lot of engineering solutions required." Nissan is also in talks with Hinduja group company Ashok Leyland to develop a small car for the global market that could be priced around $4,500-5,000.

"We have a formal agreement with Ashok Leyland for making light commercial vehicles in India . In addition, we also use Ashok Leyland's engineering services for various purposes. At the moment, we are talking to them and many other partners in China , Indonesia ...for a price centric vehicle," Nissan Motor Co executive vice-president Collin Dodge had said at the Geneva Motor Show in March.


Kasab verdict a message to Pak: Chidambaram

Home Minister P Chidambaram on Monday said that the conviction of Ajmal Kasab and acquittal of two local accomplices in Mumbai attack case shows India is governed by rule of law but sends a message to Pakistan that it should not export terror.

"The court has convicted certain accused. It also acquitted two accused. That shows the independence, fearlessness and integrity of the court," he told reporters reacting to the judgement of a Mumbai special court.

He said that it was an open trial in accordance with law and full opportunities were given to the accused to defend themselves.

"I am satisfied that within a year we have been able to bring a verdict of conviction of a large number of accused in perhaps a very complex trial.

"The trial undermines the fact that India is a country governed by rule of law. A criminal trial can only proceed step by step and within a year, the prosecution has been able to get conviction," he said.

Asked what was the message for Pakistan, the Home Minister said the judgement "is a message to Pakistan that they should not export terror to India. If they do and if the terrorists are apprehended, we will be able to bring them to justice and give them exemplary punishment".

Happy over the trial ending in conviction, Chidambaram complimented the investigating agencies and prosecution for marshalling evidence that proved beyond doubt the horrific crimes Kasab and his associates were charged with.

Despite demands swayed by anger and emotions, he said, government decided that Kasab and associates should be tried in accordance with law, given all the rights available to any accused.

Asked if Kasab's case would meet the same fate as Parliament attack convict Afzal Guru, whose mercy petition against death sentence is pending, Chidambaram expressed surprise why the media was obsessed with the issue like the Opposition.

"The Opposition may be obsessed with Afzal Guru. I have explained so many times and I am surprised that you in the media repeating the question.

"We will take up each case according to the order in which the case is pending before the Ministry of Home Affairs and before the President of India. So, the cases will be taken up one by one," he said.

The Home Minister said his Ministry already has sent four cases after reconsideration.

"Please remember that all these cases have been sent to President once. After reconsideration, we have sent four cases to President. We will continue to send one case to the President. No one can speak what the President will do. I think we should respect the office of the President.


Azim Premji is India's Bill Gates: Forbes

Washington, May 1 (IANS) India's software tycoon Azim Premji plans to set up a world-class university to train teachers who will fan out to the teacher training institutes in India's 600 districts.

'It will be a world-class university with a large endowment,' 64-year-old Premji told Forbes magazine noting, 'Most of these institutes are a complete mess with the teachers leading the classes worse than the teachers that come to get trained.'

The proposed university to upgrade teaching methods will be the latest venture of Azim Premji Foundation that focuses on education, improving standards in India by training teachers and, among other things, funding model schools.

Started nine years ago and funded solely by Premji, the foundation was given stock valued at 'much more than' Rs 450 crore or roughly $101 million estimated by a newspaper.

Much like Microsoft founder Bill Gates, Premji also plans to give away most of his money during his lifetime, the US business magazine revealed.

'Even if I was to give my children a small part of my wealth, it would be more than they can digest in many lifetimes,' he said by way of explaining.

For Premji, Forbes said philanthropy boils down to a simple philosophy: 'To those to whom much is given, much has to be given back.'

If the Indian software billionaire, who ranks No. 28 among the richest people in the world with $17 billion to his name, winds up giving away most of his money to charity, he would be a rare breed among Asian entrepreneurs who have tended to pass their wealth onto their children rather than putting it to philanthropic use, it said.

The efforts of Premji's foundation are separate from the philanthropic initiatives Wipro pursues, Forbes noted.

Some of these initiatives, such as Mission 10X, which is focused on making India's engineering students more employable in the information technology industry, clearly dovetail with Wipro's business interests.

Others, such as Wipro Cares, match contributions from employees and provide disaster relief, lending a hand after the earthquake in Gujarat or the floods in Orissa, for instance.

Both the foundation's and Wipro's philanthropic efforts, according to the US business magazine, share a common philosophy: They seek to offer the recipients of aid an ownership stake by often requiring them to pick up some of the tab.


Congress accuses BJP of 'greed for power'

The Congress's Jharkhand unit on Friday accused the BJP of "greed for power" which, it said, has led the saffron party to put on hold withdrawal of support to the Shibu Soren government in the state.

Alleging that the BJP was again "playing the game of numbers", a Congress release here said "Frequent change of decisions among the BJP and the JMM has not only left Jharkhand reeling under a political crisis, but also lowered the dignity of democratic norms."

It accused the BJP of "greed for power ignoring principal problems like naxalism, electricity and water crisis and poverty in the state."

"As per its political strategy, the BJP has forced JMM to write the letter of apology and for government formation by the BJP," the Congress claimed.

PCC leader Radhakrishna Kishore claimed that JMM-LP leader Hemant Soren had met a few Congress MLA yesterday at the residence of Congress MLA Gopalnath Sahadeo.

"Our MLAs told Hemant Soren that if you have any proposal you can put it before the AICC leadership. But, the Congress will not initiate any move unless it is sure that a transparent, stable and a full-term government is possible," Kishore said.

Meanwhile, Congress leader and former deputy chief minister Stephen Marandi, who was in the erstwhile Shibu Soren-led UPA government, told a press conference along with other PCC leaders here that JMM leaders were feeling "suffocated" because of their party's alliance with the BJP.

"But they are unable to do anything, may be due to the fear of the anti-defection law," Marandi, who was a former JMM leader and broke up with Shibu Soren before the 2005 assembly elections after being denied party ticket, said.

Marandi was apparently referring to JMM MLAs Simon Marandi and Teklal Mahato's open criticism of the party leadership for again going to the BJP after it withdrew support.


BJP withdraws support to Soren Govt in Jharkhand

BJP's four-month honeymoon with Shibu Soren ended abruptly on Wednesday with the party withdrawing support to the JMM-led government, a day after the Jharkhand Chief Minister sided with the UPA in the Lok Sabha.

A meeting of the BJP top brass, headed by party chief Nitin Gadkari, decided to withdraw support immediately giving indications that the new experiment in Ranchi has floundered.

"The BJP Parliamentary Board has decided to withdraw support immediately to the Shibu Soren government. He (Soren) has behaved in a very dubious manner and voted with the government during the cut motion. BJP has taken very serious note of this betrayal and dubious conduct," senior BJP leader Ananth Kumar told reporters here.

New equations in Jharkhand appeared to be in the offing with AICC in-charge of the state K Keshav Rao saying, "There is nobody untouchable in politics....(We were) never averse to it (forming a government with JMM). After all we contested the election there to form a government. In politics there is no last word."

BJP leader and Jharkhand Deputy Chief Minister Raghubar Das will submit a letter to the state governor withdrawing support to the JMM-led government later in the day.

"The Deputy Chief Minister and all BJP ministers in the Jharkhand government will also submit their resignations to the governor," Kumar said.

Kumar, who along with former party president Rajnath Singh was part of the negotiations with Soren just four months ago to form a government, refused to comment on whether BJP's coalition experiment has failed in the state.

With elections to the state legislature throwing up a hung assembly, BJP had formed a coalition government with Soren.

In the 82-member Jharkhand Assembly, BJP and JMM have 18 seats each, Congress 14, RJD 5, JVM 11, ASJU 5, JD(U) 2, CPI(ML) 1 and others and independents six. One member is nominated.


Monetary Policy: What it means for us

The Monetary policy can be termed as "The annual RBI vision document" for the coming year. It is basically a synopsis of what has been done by the central bank in the preceding year and clear indication of what it plans to do in the coming year in the domains under its purview.

The monetary policy for 2010-11 has been announced on 21st April 2010. This article will try to decipher its contents for the common man.

Monetary measures
-Bank rate has been maintained at the earlier level of 6%
-Repo rate has been increased by 25 basis points to 5.25
-Reverse repo rate has been revised to 3.75% from 3.5%
-Cash reserve ratio has been increase to 6% from 5.75% effective 24 April 2010

The above actions in effect will mean that almost close to Rs 12500 crores will be taken out of circulation. Meaning there will be a reduction in loans being given out at least at the lower spectrum or alternatively and practically this could lead to increase in interest rates, more competition among banks to get customers (better rates, better service). The net effect is expected to be that inflation will be contained and more stability in prices can be expected.

From the economy point of view too this will support the recovery of the economy meaning better salaries and employment opportunities in the medium term. The actions also don't seem to be detrimental to meeting the requirements of government and private credit demand.

Financial Stability Report:
As a fall out of the financial crisis the RBI came up with the idea of a Financial Stability Unit to monitor the economy and carry out regular stress testing and creating related reports. The current report has mentioned that the first FSR has indicated concerns relating to rising inflation, government borrowing and capital flows. The good news is that the banking sector has been indicated to be stable and have a high ability to withstand stress. (For the common man this is a sign of relief considering the closure of banks in almost all countries across the globe). The central bank adds a word of caution saying financial stability cannot be taken for granted and hence is considering making the FSR a half-yearly exercise.

Base Rate:
The base rate system will be implemented from the 1st of July 2010 and is expected to create a more transparent system of loans, result in better pricing and also ensure that the central bank's monetary policies are well transmitted to the common man.

Interest rate futures
The central bank has proposed to introduce Interest rate futures on 5 year and 2 year notional coupon bearing securities and 91 day treasury bills.

No collateral for SME loans
The RBI has announced its intention to mandate banks not to ask for any collateral for loans of upto Rs. 10 lakh when availed by Micro and Small enterprises. This will result in a boost to entrepreneurship and probably boost more cheaper services and better products in the market. Employed individuals can now take that important step towards becoming 'employer' and thus add to the growth of economy.

Focus on Financial inclusion at the rural level
The bank has indicated its commitment to revive rural co-operative banks and also facilitate more Large Adivasi Multipurpose Co-operative societies (LAMPS) and Farmers Service Societies (FSS) to enable the broader idea of financial inclusion of the farmers. For us this could mean that over the long term farmers will have more and easy access to cheap credit thus helping them boost productivity and maybe finally lead to a reduction in food inflation.

Spreading the net of banking
Continuing its intention of increasing banking penetration the RBI is putting pressure on Private and Public banks to have a clear Financial Inclusion Plan. It is also relaxing norms relating to Business Correspondents. This could mean that there will be more access to banking services in each nook and corner resulting in better cash flow and improvement in the standard of living of all citizens at the lower end of the financial spectrum. For us this could mean more contribution from the agriculture and rural sectors resulting in a long term stabilizing of prices.

Urban Sector co-operative banks (UCB)
After over 6 years of banning the setting up of UCBs the RBI is considering revisiting the ban to improve penetration of UCBs and also allowing them to enter new areas of business. This could mean more choices in banking for the urban customer looking at alternatives to the Commercial banks. This would also lead to more off-site ATMs so you don't have to travel long distances in your car to withdraw cash from an ATM.

Customer Service
The RBI is seriously looking at issues relating to levying excessive interest rates and charges of loans and advances. The central bank is looking at mandating banks to pull up their socks vis-à-vis customer service especially as the banks are considered privileged institutions and a special public utility service. It is looking at brining in regulations relating to issuing guidelines on customer service and also ensuring the implementing the same through on-site and off-site inspections and making it mandatory for board meeting to discuss and deliberate on customer service. We could expect more smiling banking executives and also have reasonable rates of interest on loans.

The other announcements relate to Regulatory and Supervisory measures for Commercial Banks and Institutional developments which will not have a very direct effect on the common man, yet, will be discussed in a separate article as it has high relevance for the banking sector.


INTERVIEW - Tata Steel sees iron ore prices rising

Iron ore prices are headed as much as 35 percent higher this year and will likely pressure the profit margins of steel companies, Tata Steel Ltd Vice Chairman B. Muthuraman said on Tuesday.

"I don't know where it's going to settle down, but it does look 25 percent to 30 percent to 35 percent higher," he said in an interview. "It may be possible that the steel prices may not go up by that much."

"This means the steel companies will come into margin pressure," he added.

Global steel production had tumbled last year as demand from key industries such as construction and automotive shrank. But as macroeconomic data improves and inventories deplete, demand is expected to build this year.

Tata Steel, the world's eighth-largest steelmaker, owns its own iron ore and coal supply sources in India. It sees steel prices rising but not to the extent of the raw materials.

"Steel prices depend on supply and demand, and I don't see the demand going up so sharply this year," Muthuraman said. "So demand not being extremely strong will put a cap on the steel price increase."

Spot market prices for iron ore surged more than two-fold in the last 12 months on strong demand from China and recovery in Europe, and the United States. The price for iron ore remains near $130 a tonne.

Also, global miners are currently in negotiations with the world's largest steel producers in setting a key annual iron-ore benchmark price, a bulk discount to the spot price.

The iron ore prices are typically set each year following negotiations between big suppliers -- Vale, Rio Tinto and BHP Billiton -- and large steel mills.

Muthuraman said he expected the negotiations to wrap up in the next two months.


Muthuraman said he expects growth for the company to come from Southeast Asia and India.

"In India, we are going up to 10 million tonnes by next year," he said, referring to capacity.

Tata Steel's total global capacity is about 30 million tonnes, with its European unit Corus contributing tow-thirds of the capacity. India currently accounts for about 7 million tonnes.

Tata Steel has been trying to cut costs by rationalizing operations in Europe and reworking interest costs.

Muthuraman said he wants to make the company's European operations more cost competitive and up to 50 percent self-sufficient in coal and iron ore.

Currently, the company buys both the raw materials for the European unit but will feed about 15 percent of the supply needed from its investment in a Canadian iron ore mine and a coal mine in Mozambique, which are expected to come online next year.

Muthuraman said the company continues to hunt for more sources of iron ore and coal for the European unit.

"As far as Europe is concerned, we are aiming to make that plant more competitive," he said. "We are aiming to own raw materials around the world."

"It will take some time," Muthuraman said, when asked when the European unit will move to growth.

"We want to make it more efficient, in terms of putting in better systems and processes," he added. "I think in 5-6 years time, our European operation will become as efficient as our Indian operation."

(Reporting by Poornima Gupta; editing by Carol Bishopric)

Poornima Gupta


Rajya Sabha passes Women's Reservation Bill

A historic bill granting 33 per cent reservation for women in the Lok Sabha and State Assemblies was today passed by the Rajya Sabha after two days of high drama that saw suspension of seven members who violently disrupted proceedings.

The Rajya Sabha passed the historic Women's Bill by division with 186 votes in favour, one against and no abstentions.

The Women's Reservation Bill, pushed by the government despite the threat of withdrawal of support by Samajwadi Party and RJD, was passed by a two-third majority, a day after it was moved in the House for consideration but could not be taken up because of unruly scenes.

Amongst those who spoke were Bharatiya Janata Party's (BJP) Arun Jaitley, Communist Party of India-Marxist's (CPI-M) Brinda Karat, Bahujan Samaj Party's (BSP) Satish Mishra and Jayanthi Natarajan of Congress.

Opening the debate was Jaitley, who said his party 'unequivocally' supported the women's bill but added that the privilege of supporting it had been diluted by 'some of the most shameful incidents in India's parliamentary history'.

Karat, a vocal supporter of the bill, said women's reservation in parliament and state legislatures would change the 'culture of the country because women today are still caught in a culture prison. In the name of tradition, stereotypes are imposed and we have to fight these every day'.

These stereotypes will also be broken by the bill, said Karat, who believes the entry of a larger number of women in legislatures would make for 'more sensitive politics'.

'The women's reservation bill will ensure that women of Scheduled Caste, Scheduled Tribe, Other Backward Classes, poor women and Muslim women would benefit from it,' Karat said, addressing concerns that the bill would benefit only some sections.

Congress leader and spokesperson Jayanti Natarajan also refuted critics demanding a special quota for Dalit women, saying Dalits and tribals would continue to get reservation under the bill.

Earlier, cracking the whip on disruptive MPs, Rajya Sabha Chairman Hamid Ansari suspended seven members for the remaining part of the Budget session for their unruly behaviour in the House yesterday over the Women's Reservation Bill. (Text: Agencies)


Reliance has no plan to raise bid for Lyondell

Mumbai: Reliance Industries Ltd (RIL) has no plans to increase its bid for bankruptLyondellBasell Industries AF after creditors rejected a $14.5 billion (Rs66,555 crore) offer, two people briefed on the matter said.

Market conditions didn’t justify raising the offer further, the people said, declining to be identified because they aren’t authorized to speak to the media. Asia’s richest man Mukesh Ambani may be prompted to spend Reliance’s $3.5 billion cash elsewhere, said Victor Shum, an analyst at Purvin and Gertz Ltd.

The Mumbai-based company’s shares surged 4.7% after the bid was rejected on Tuesday for a second time this year.

Reliance is seeking assets abroad to reduce the risk of investing mostly in India, where it is battling a lawsuit over natural gas supplies with a company owned by Mukesh’s estranged brother Anil Ambani.

“Reliance has a very strong position in India but it doesn’t internationally,” Nathan Schaffer, an analyst at PFC Energy, said by phone from Houston. “There will be plenty of opportunities to pick up some attractive assets.”

Alok Agarwal, chief financial officer at Reliance, couldn’t be reached at his office.

Rising crude oil prices coupled with weak global demand for fuels and chemicals are prompting companies to sell assets.

Oklahoma-based Devon Energy Corp., the biggest independent US oil and gas producer, on 16 November announced it was putting oil blocks from the Gulf of Mexico to the Caspian Sea up for sale to raise $7.5 billion to cut debt and fund onshore developments.

Houston-based ConocoPhillips plans to sell $10 billion of assets in two years to cut debt that may include exploration and production holdings in North America and gas properties in the North Sea, chief executive officer Jim Mulva said in October.

Reliance operates India’s biggest natural gas field, owns the world’s largest refining complex at Jamnagar in Gujarat, and has cash holdings of Rs 160 billion . While it has interests in overseas oil blocks, including in Peru, Iraq and Australia, only one in Yemen is producing at 4,400 barrels a day, according to Reliance’s earnings statement for the three months ended 31 December.

Reliance seeks a “far more widespread global footprint” in the near term, Ambani told shareholders on 17 November.

The company may buy oil fields in the Gulf of Mexico and Brazil to hedge the risk of investing mostly in India, P.M.S. Prasad, president of its oil and gas business, said on 14 September.

In December, Reliance hired Walter van de Vijver, a former exploration chief at Royal Dutch Shell Plc, to head its overseas business.


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Building the new private bank

Mumbai: The Aditya Birla Group and Reliance-Anil Dhirubhai Ambani Group would ask the Reserve Bank of India (RBI) permission to open new banks once there is more clarity from the banking regulator.

They are two of many Indian firms that may queue up for banking licences, following finance minister Pranab Mukherjee’s announcement that the central bank is considering giving some additional banking licences to private sector firms and non-banking finance companies (NBFCs).

NBFC stocks rose on the Bombay Stock Exchange. Srei Infrastructure Finance Ltd rose 2.79% to close at Rs64.50; Reliance Capital Ltd jumped 8.12% to close at Rs786.45; Muthoot Capital Services Ltd was up 1.91% to close at Rs80; Infrastructure Development Finance Co. Ltd rose 4.69% to close at Rs159.55 and IFCI Ltd jumped 8.1% to close at Rs51.40.

On the anvil: RBI last granted new licences to banks in 2003. Hemant Mishra/Mint Srei, Reliance Capital, Aditya Birla Financial Services Group and Muthoot are keen to convert themselves into banks.

“This move will potentially open exciting new avenues of growth for Reliance Capital in the future,” said Sam Ghosh, chief executive officer of Anil Ambani-owned Reliance Capital. “We await further details and guidelines.”

“The Aditya Birla Financial Services Group is already a large non-bank player, occupying a significant position across all its verticals,” said Ajay Srinivasan, chief executive, financial services, Aditya Birla Group. “We wholeheartedly welcome this initiative and will definitely apply for a licence.”

But RBI is not in a hurry to issue fresh licences. “We will have to start working on it and ...take into account our experience and what is practical,” deputy governor Usha Thorat said.

“There will be new licences. In the last five years we have not given any new licences. However, while we do this, we will keep in view the basic principles which are already there, mainly diversified shareholding and fit and proper guidelines,” she added. “The basic principles of ownership and governance will remain unchanged, because that has stood the test of time.”

RBI had last granted licences to two banks in 2003.

The existing ownership guidelines restricts the ownership of large industrial houses in banks to 10%. The guidelines on conversion of NBFCs into banks also do not permit NBFCs promoted by a large industrial house or owned and controlled by public authorities, including local, state or Union governments, from converting into banks.

Reliance Capital’s Ghosh said the firm is still waiting to hear from RBI on how it intends to deal with issues such as shareholding patterns or whether NBFCs will get to retain existing holding structure. “Basically, how will these licences be given out and who will get it,” he said.

In his annual general meeting speech in July last year, Anil Ambani had reiterated that his group wanted to own a bank as soon as the country’s regulations allowed private entities to do so.

Tata Capital Ltd, a subsidiary of Tata Sons Ltd, said it would await a firm policy announcement before commenting on the issue.

Thomas George Muthoot, director, Muthoot Pappachan Group, said: “We will be able to decide on our action plans only after receiving the complete details.”

Hemant Kanoria, chairman and managing director Srei Infrastructure Finance, said: “We had been proposing this to the government for quite some time because we sincerely feel this is an idea whose time has certainly come. However, we await the details.”

However, things will not change overnight.

“The implementation of this announcement will depend on RBI,” said Shefali Goradia, partner, BMR and Associates, a consultancy. “The central bank has been very conservative in its dealing with non-banking finance companies. Even if it issues new guidelines, they would be laced with many conditions.”


FM revises tax slabs to give more money to consumers

NEW DELHI: The 2010-11 general budget today provided considerable relief to income tax payers by raising the slabs at two levels but hiked the central excise duty on non-petroleum products across the board from 8 to 10 per cent and the basic duty on crude and petroleum products besides effecting a one-rupee increase per litre on petrol and diesel.

The basic threshold limit for income tax exemption will remain at Rs 1.60 lakh. Under the new proposal, 10 per cent tax will be levied between Rs 1,60,001 and Rs 5,00,000, 20 per cent on incomes between Rs 5,00,001 and Rs 8,00,000 and 30 per cent above Rs 8,00,000.

The present income tax slabs and rates are 10 per cent for income between Rs 1,60,001 and Rs 3,00,000, 20 per cent for income between Rs 3,00,001 and Rs 5,00,000 and 30 per cent for income above Rs 5,00,001.

Proportionately, similar changes have been made in the taxes related to women and senior citizens aged above 65 years.

Mukherjee also gave another relief to individual tax payers by raising the existing limit of Rs 1,00,000 on tax savings by an additional amount of Rs 20,000 for investments in long-term infrastructure bonds.

Contributions to Central Government Health Scheme (CGHS) have also been allowed as deductions within the overall ceiling for tax rebate besides contributions to health insurance schemes which are currently allowed as deductions under the Income Tax Act.

The entire opposition walked out of the Lok Sabha during the presentation of budget by finance minister Pranab Mukherjee, dubbing it "highly inflationary" as he partially rolled back the stimulus by hiking the ad velorum component of excise duty on large cars and multi-utility vehicles by two per cent to 22 per cent.

The budget also raised the specific rates of duty on portland cement and cement clinker. The basic duty of 5 per cent on crude petroleum, 7.5 per cent on diesel and petrol and 10 per cent on other refined products is being enhanced.

The central excise duty on petrol and diesel is being enhanced by Re one per litre.

The proposals relating to customs and central excise are estimated to result in a net revenue gain of Rs 43,500 crore for the year. The proposals for service tax, in which government plans to bring in some more services, will result in a net revenue gain of Rs 3000 crore for the year.

While direct tax proposals are expected to result in a loss of Rs 26,000 crore for the year, those relating to indirect tax are estimated to result in a net revenue gain of Rs 46,500 crore.

Taking into account the concessions and measures to mobilise additional resources, the overall revenue gain is estimated to be Rs 20,500 crore for the year.

The budget also proposed a hike in defence expenditure from Rs 1,41,703 crore to Rs 1,47,344 crore, including Rs 60,000 for capital expenditure.

In the Budget Estimates for 2010-11, gross tax receipts are estimated at Rs 7,46,651 crore while the non-tax revenue receipts are estimated at Rs 1,48,118 crore.

Total expenditure is placed at Rs 11,08,749 crore, which is an increase of 8.6 per cent over the total expenditure in Budget Estimates of 2009-10. The plan and non-plan expenditures in Budget Estimates in 2010-11 are estimated at Rs 3,73,092 crore and Rs 7,35,657 crore respectively.

The fiscal deficit for 2010-11 has been pegged at 5.5 per cent and the rolling targets for 2011-12 and 2012-13 have been pegged at 4.8 per cent and 4.1 per cent respectively.

The fiscal deficit of 5.5 per cent of GDP in 2010-11 works out to Rs 3,81,408 crore. Taking into account various other financing items for fiscal deficit, the actual net borrowing of the government in 2010-11 would be of the order of Rs 3,45,010 crore.

In direct taxes, the Finance Minister proposed to reduce the current surcharge of 10 per cent on domestic companies to 7.5 per cent but at the same time raised the rate of Minimum Alternate Tax (MAT) from 15 per cent to 18 per cent of book profits.

In indirect taxes, Mukherjee made structural changes in the excise duty on cigarettes, cigars and cigarillos, coupled with some increase in rates. He also proposed to enhance excise duty on all non-smoking tobacco such as scented tobacco, snuff and chewing tobacco.

In addition, he proposed to introduce a compounded levy scheme for chewing tobacco and branded unmanufactured tobacco based on the capacity of pouch-making machines.

Attempting to pay focused attention to agriculture and related sectors, the Finance Minister proposed to provide project import status with a concessional import duty of 5 per cent for setting up mechanised handling systems and pallet-racking systems in mandis and warehouses for foodgrain and sugar as well as full exemption from service tax for installation and commissioning of such equipment.

A similar status on customs duty with full exemption from service tax will also be extended to initial setting up and expansion of cold storage, cold room and processing units for such produce.

Extending his goodies in excise duties in certain sectors, he gave full exemption to toy balloons and reduction in basic customs duty on long pepper, asafoetida and excise duty on goods covered under Medicinal and Toilet Preparations Act.

The Service Tax net is being expanded to include domestic and international air journeys of all classes, health check-up undertaken by hospitals for employees of business entities and health services provided under health insurance schemes offered by insurance companies.


3 Google executives convicted of privacy violations

Milan: Three Google executives were convicted of privacy violations Wednesday in allowing a video of an autistic boy being abused to be posted online — a case that has been closely watched for its implications on Internet freedom.

Judge Oscar Magi sentenced the three to a six-month suspended sentence and absolved them of defamation charges. A fourth defendant was acquitted altogether.

The trial had been closely watched since it could help define whether the Internet in Italy is an open, self-regulating platform or if content must be better monitored for abusive material.

Google, based in Mountain View, California, had said it considered the trial a threat to Internet freedom because it could force providers to attempt an impossible task — prescreening the thousands of hours of footage uploaded every day onto sites like YouTube.

Prosecutors insisted the case wasn’t about censorship but about balancing freedom of expression with the rights of an individual.

The charges were sought by Vivi Down, an advocacy group for people with Down syndrome. The group alerted prosecutors to the 2006 video showing an autistic student in Turin being beaten and insulted by bullies at school. In the footage, the youth is being mistreated while one of the teenagers puts in a mock telephone call to Vivi Down.

Google Italy, which is based in Milan, eventually took down the video, though the two sides disagree on how fast the company reacted to complaints. Thanks to the footage and Google’s cooperation, the four bullies were identified and sentenced by a juvenile court to community service.

The events shortly preceded Google’s 2006 acquisition of YouTube.

All four executives denied wrongdoing. None was in any way involved with the production of the video or uploading it onto the viewing platform, but prosecutors argued that it shot to the top of a most-viewed list and should have been noticed.

Convicted of privacy violations were Google’s senior vice president and chief legal officer David Drummond, former chief financial officer George Reyes and global privacy counsel Peter Fleischer. Senior product marketing manager Arvind Desikan was acquitted.


Railway Budget 2010: Highlights

The main highlights of the 2010-11 railway budget include:

-- No increase in passenger fares
-- Rs.100 reduction in freight per wagon for fertilisers and kerosene
-- Free travel for cancer patients in 3rd AC classes
-- Cost-sharing in public-private-partnership (PPP) mode in some gauge-conversion projects
-- Further extension of Kolkata Metro on priority basis; stations to be named after Bahadur Shah Zafar, Tagore family
-- Karmabhoomi trains to be introduced for migrant labour
-- New Janmabhoomi train between Ahmedabad and Udhampur
-- Special "Bharat Teertha" train to be run around India to commemorate Rabindranath Tagore's 150th birth anniversary
-- Railway line to be extended from Bilaspur in Himachal Pradesh to Leh in Jammu and Kashmir
-- Andaman and Nicobar Islands to get railway line from Port Blair to Diglipur
-- Sikkim capital Gangtok to be connected by rail from Rangpo
-- 2011 being 150th anniversary of Rabindranath Tagore, special train to be run from West Bengal to Bangladesh
-- Gross earnings in 2009-10 estimated at Rs.88,281 crore
-- Working expenditure in 2009-10 estimated at Rs.83,440 crore
-- Expenses during 2010-11 estimated at Rs.87,100 crore
-- Thrust on expansion in 2010-11 with allocation of Rs.4,411 crore
-- Kashmir rail link to be extended to Sopore in the north of the valley
-- Net profit of Rs.1,328 crore in 2009-10
-- 10 automobile ancillary hubs to be created
-- Twenty-two million energy saving CFLs for lighting distributed already
-- Policy decision to employ one member of family whose land is requisitioned for railway projects
-- North-south, east-west dedicated freight corridors to be created
-- Construction of high-speed passenger rail corridors envisaged
-- More multi-functional hospitals to be set up
-- Educational facilities to be set up for children of 80,000 women families
-- Special facilities to be established for gangmen
-- Insurance facilities for licensed porters as part of railway's corporate social responsibility
-- Centre for railway research to be established with Indian Institutes of Technology and Defence Research and Development Organisation
-- Will involve unions in policy making
-- Integral Coach Factory Chennai to be further modernised
-- New wagon repair shop in Mumbai
-- Design, development and testing centre for railway wheels at Bangalore
-- Within five years, all unmanned level crossings to be manned
-- Construction of more underpasses, besides road overbridges
-- Greater coordination with state governments to protect railway property
-- Security of women passengers to be improved
-- Ex-servicemen to be employed in Railway Protection Force
-- Five sports academies to be set up
-- Astroturf to be provided for development of hockey
-- Employment opportunities for sports persons
-- Railways to be lead partner for Commonwealth Games
-- Special drive to increase passenger amenities
-- Upgrade of 94 stations
-- Six new drinking water bottling plants in PPP mode
-- Modern toilets at railway stations
-- More ticketing centres to help the public
-- Acquisition of cutting edge safety technology
-- 1,000 route km to be created
-- Special task force for clearing investment proposals in 100 days
-- New business model to be created
-- No privatisation of railways
-- But greater participation of private sector
-- 117 of 120 new trains for current fiscal to be flagged of