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Business & Economy

Orion India launches Kochi operations

Orion India Systems Pvt Ltd, a subsidiary of the US-based Orion Systems Integrators, launched its operations in this port city of Kerala by opening a state-of-the-art technology and development centre in the Infopark Special Economic Zone here.

The launch of the new office, spread over about 1100 sq metres, is in line with Orion's vision of expanding its enterprise to provide high quality and cost-effective IT solutions to its global customers, including those in the US, Europe and Latin America, the company said in a press release.

"In today’s ever changing landscape of how services are best delivered, Orion stays ahead of the curve by evaluating and adopting the most modern provisions in the right geographies to create a robust, scalable and a highly secure ODC environment. Our goal is to make Kochi ODC a Center of IT Excellence for Global Deployment," Mr Sunil Mehta, CEO and Director Orion Group of Companies, said.

"The centre will house some of the best IT talent selected from Kochi and neighboring cities. We are proud to be a part of the state that has the highest literacy rate in India," Mr Narendra Kumar, Director of Orion India Systems, said.

Orion India started its operations in 2003 with an office in Mumbai, India, and has grown into a 150+ people company.

In Kochi, the company plans to expand to a workforce of about 400 people over the next three years, the release added.

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India promises help to Uganda in rail transport sector

India today promised all possible assistance to Uganda in developing and expanding integrated rail services.

The assurance was given by Minister of State for Railways K.H.Muniyappa during a meeting with Uganda's Minister of State for Urban Development, Mr. Urban Tibamanya, here.

The two ministers discussed in detail the bilateral cooperation between the two countries in the rail transport sector. The Ugandan minister expressed his gratitude and satisfaction over the assistance provided by Indian Railways in the expansion of his country's rail network.

Mr Muniyappa said that RITES, a public sector undertaking and a leading international transportation consultant with operational experience in 60 countries, would continue to help Uganda in the development of its railways.

RITES had undertaken Kampala Urban Traffic Improvement Plan (KUTIP) through international competitive bidding in 2001-02. The project is funded by World Bank and coordinated by Kampala City Council and the Ministry of Local Government.

RITES also undertook consultancy services for design review, tender assistance and construction supervision of strengthening of the Kikorongo-Katunguru and Equator Roads (53.5 km) against a World Bank Funds Contract. It has been completed successfully in 2007.

RITES has provided training to 20 personnel from the Uganda Railways between 1985 and 1995, an official press release added.

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OMCs to release 5.5 cr new LPG connections by 2015

Minister of State for Petroleum and Natural Gas Jitin Prasada today directed the public sector Oil Marketing Companies (OMCs) to draw up a year-wise and a state-wise road map for releasing 5.5 crore new connections by 2015.

This will enhance the population coverage from about 50% at present to 75% in line with the Vision 2015 finalised by the ministry recently, he said.

Mr Prasada said the focus would be on those states which currently have very low LPG coverage. The government's endeavour is to take LPG to rural areas of the country, he added.

The meeting was attended by Marketing Directors of Indian Oil Corporation, Hindustan Petroleum Corporation and Bharat Petroleum.

Mr Prasada also asked the companies to pay attention to issues like customer satisfaction and service delivery of petroleum products. He said the focus should be on prompt delivery of LPG refills and issuing of new LPG connections.

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Maran inaugurates Garment Fair and first Silk Exhibition

Textiles Minister Dayanidhi Maran at the “SILK PARADISE” exhibition of Indian silk, organized by the Indian Silk Export Promotion Council.
Textiles Minister Dayanidhi Maran at the “SILK PARADISE” exhibition of Indian silk, organized by the Indian Silk Export Promotion Council.
Union Textiles Minister Dayanidhi Maran inaugurated the 43rd edition of the India International Garment Fair (IIGF) and the first exclusive Silk Exhibition, titled "Silk Paradise" at Pragati Maidan here today.

These exhibitions, which will run until Friday, have been organised by the International Garment Fair Association (IGFA), the Apparel Export Promotion Council (AEPC), the Garment Exporters Association (GEA), the Clothing Manufacturers Association of India (CMAI), the Apparel Exporters and Manufacturers Association (AEMA) and the Apparel and Handloom Exporters Association (AHEA).

More than 200 garment manufacturers and exporters from Delhi, Gurgaon, Noida, Faridabad, Jaipur, Pushkar, Tirupur, Mumbai and Kolkata are participating in the events, which are expected to attract over 3000 visitors from 70 countries.

The exhibitions will see Indian garment exporters launch new ranges of products and make efforts to strengthen existing markets and explore new ones.

"Silk Paradise" is being organized by the Indian Silk Export Promotion Council (ISEPC) , where 80 participants from all over India are showcasing their product range in garments, home furnishing, accessories and fabrics.

It is expected that 300 to 400 serious buyers and buying agents will visit the exhibition and on-the-spot business of Rs. 200 to 300 crore is expected and in the short and medium term business of Rs. 1,000 crore will be generated, an official press release said.

Talking to mediapersons on the sidelines of the events, Mr Maran said he was impressed by the scale of participation and was happy to learn that, despite the recession, the fairs had been able to attract buyers.

"What gives me satisfaction is that 20 buyers from Japan as well as some buyers from Argentina and Uruguay have come for the first time. This vindicates our 'Look East Policy’ and focus on opening of new markets, particularly, in Latin America, Africa and Oceania," he said.

Mr Maran said he would be leading a trade delegation to Japan next week, where he will hold discussions with government officals and business. He said 30 Indian textiles and clothing exporters were participating in the Japan International Fashion Fair (JIFF).

The minister said the silk sector was an important part of Indian textiles and it presently contributes Rs. 3,500 crore to Indian textiles and clothing exports, according to figures for 2007-08, and this is expected to rise to Rs. 7,000 crore by 2012.

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1200 MW Rosa Power Project achieves financial closure

Rosa Power Supply Company Ltd, a wholly-owned subsidiary of Reliance Power Limited, a part of the Reliance Anil Dhirubhai Ambani Group, has signed financing agreements for long-term loan with various banks and financial institutions led by IDBI Bank.

The project, being set up in the Shahjahanpur district of Uttar Pradesh, would help the state move significantly forward on the way to self-sufficiency in power supply.

The Rosa Project, which will become completely operational well within the XIth Plan period, will supply 900 MW of power to Uttar Pradesh Power Corporation Ltd, a press release from the Reliance ADA Group said.

It said Stage I of the Project was in an advanced stage of construction and expected to commence generating power within this year itself, ahead of schedule.

The banks and financial institutions which signed the loan agreements here on Monday for the expansion stage includes IDBI Bank, the lead lender to the project, Punjab National Bank, United Bank of India, Life Insurance Corporation of India, Andhra Bank, Axis Bank, Indian Bank, Karur Vysya Bank, State Bank of Bikaner and Jaipur, State Bank of Mysore, Syndicate Bank, The South Indian Bank, Oriental Bank of Commerce, Corporation Bank and Vijaya Bank.

With this project, Reliance ADA Group becomes one of the largest private sector investors in Uttar Pradesh with an investment outlay of more than Rs. 10,000 crore.

The expansion phase has obtained all major approvals and clearances. Coal linkage from Central Coalfields Ltd from its coal mines located in Jharkhand has been obtained for supply of around five million tonnes per annum of coal for the project, which will be transported by Indian Railways. The company has signed the Engineering, Procurement and Construction Contract and has issued the "Notice to Proceed" with Shanghai Electric Company of China, the release added.

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PC sales record 7 % negative growth first time ever: MAIT

Computers
MAIT, the apex body representing India's IT hardware, training and research and development sectors, today said total sales of personal computers (PCs) in 2008-09 had declined by seven per cent over the previous year.

In a press release, announcing the findings of its Industry Performance Review for fiscal 2008-09, MAIT said the the total sales of desktop computers, notebooks and netbooks taken together were 6.79 million units during the period April, 2008 to March, 2009.

"IT consumption in 2008-09 was severely impacted, especially in the second-half of the fiscal year, by the slowdown in the Indian economy," the release said.

According to it, the impact on consumption of notebooks was most pronounced as growth plummeted to a negative 17 % compared to a high of 114 % in the previous year. Sales of desktops declined four percent.

The October-December quarter was the most adversely impacted, subsequent to which growth in PC consumption started to show signs of revival. With business sentiment gradually gaining momentum, PC consumption in fiscal 2009-10 is expected to cross 7.3 million units, registering a seven per cent growth, the release said..

Commenting on the findings of the study, MAIT Executive Director, Vinnie Mehta said: "Consumer sentiment was subdued due to uncertainty in the economy in 2008-09 which impacted the consumption of IT in the country. While consumption in the first-half of the fiscal was satisfactory, less than expected offtake in sales in the second-half pulled down the overall growth into the negative quadrant. A silver lining in the second-half of 2008-09 was the emergence of a new product category, the net book that took the fancy of the consumers. This new form-factor appeared to be better insulated from the prevailing market sentiments."

He added, "Although the sales growth in both the enterprises and the households headed southwards, the overall consumption in the PC market was led by telecom, banking and financial service sectors, education and the e-governance initiatives of the Union and the state governments. Verticals such as BPO/IT-enabled services, manufacturing, retail and households, which traditionally account for significant proportion of the IT market, were very conservative in their IT spends in 2008-09. Sales of desktops clocked 5.27 million units, declining four per cent, and that of notebooks, with netbooks taken together, another 1.51 million units with a degrowth of seventeen per cent.

"Consumption of netbooks exceeded 70,000 units in fiscal 2008-09. The year also witnessed deviations from the traditional downward trend in pricing for IT products as the dollar continued to be significantly strong compared to the rupee. This was mitigated, to an extent, by price drops due to technology reasons and also due to intense competition. Going forward, with signs of revival in the domestic economy, we expect positive growth for PCs and other IT products for the fiscal 2009-10."

According to the release, Western India followed by the South, led PC consumption accounting for 37 % and 23 % of the market, respectively. Sales in the West grew by 12 % over 2007-08, while in South it declined 22 %.

PC consumption in the East increased by 18 %, accounting for 22 % of the market, a reflection of IT activities gaining ground in the region. The Northern states witnessed a decline of 34 % in PC sales, and accounted for 18 % of the market.

Unlike the trends in the previous years, where sales in the second half of the year have been significantly higher than those in the first-half, 2008-09 witnessed a rather subdued second-half, the release pointed out.

The bi-annual MAIT Industry Performance Review – ITOPs, conducted by market research firm IMRB International, is a survey of the domestic IT market, its potential and trends. This round of the study involved face-to-face interviews with over 25,000 respondents selected randomly across 22 cities in India.

The MAIT-IMRB study was initiated in 1996-97 and encompasses five broad product segments — computers, networking products, printers, other peripherals and Internet connections.

Some of the salient findings of the MAIT Industry Performance Review 2008-09:

The Desktops Market:
  • Organised vs. unorganised segments: Multinational brands accounted for fifty-one per cent of the total desktop market in 2008-09, registering a growth of eight per cent over the forty-five per cent share last year. The proportion of Indian brands fell from twenty-two percent to eighteen percent, registering a decline of twenty two per cent. Assembled desktops and unbranded systems witnessed a degrowth of ten per cent in absolute units accounting for thirty-one per cent, down from thirty-three, of total desktop sales in 2008-09.
  • The establishments segment accounted for sixty six per cent of the desktop sales, registering a growth of five per cent on a year-on-year basis although consumption of notebooks in the establishments declined twenty-seven percent. Owing to conservative attitude, establishments do not seem to have shifted preference in favour of notebooks. The consumption in small, medium and large enterprises grew by three percent, seventeen percent and two per cent respectively.
  • Household consumption of desktops fell by eighteen per cent, accounting for thirty four per cent of the total desktop market, with sales crossing 1.78 million units. Within the Households segment, SEC A and SEC B each accounted for thirty-nine percent of the market although consumption in these declined by twenty-six percent and nineteen percent respectively. Sales to SEC C at twenty-two percent market share remained flat.
  • Market segmentation by processor sales: Desktop consumption in 2008-09 was dominated by P4 based units, which accounted for fifty-nine per cent of total sales, however, the market was quick to adopt other next generation processors such as Core-duo, Core2duo and Core2quad accounting for two per cent, twenty-two per cent and two per cent of the market respectively. Other processors like the AMD, Cyrix etc. accounted for ten per cent of the market.
  • Market segmentation by town-class: Consumption of desktops in towns and cities outside the top four metros has been progressively increasing over the years. In 2008-09, these accounted for more than three-fourth of the total desktops purchased. The top four metros accounted for twenty-five per cent of the total desktop market with a sales growth of five percent.

The Notebooks Market:
  • Notebook sales recorded a degrowth of seventeen percent due to decline in consumption in both the establishment and the households with sales declining twenty-seven percent in the establishments and another three percent in the households. The decline in consumption in the second-half of 2008-09 was more pronounced as sales of notebooks fell thirty-five percent compared to the same period last year. Towns and cities outside the top four metros contributed to nearly eighty percent of the notebook sales.
  • The establishment segment accounted for forty-nine percent of the notebook consumption, the small and large establishments recorded a decline of fifty-three and forty-seven percent respectively in 2008-09 while consumption in medium enterprises grew twenty-seven percent. The SMEs accounted for sixty-eight per cent of the total notebooks consumption in the country.
  • The household segment, accounting for fifty-one per cent of the overall notebook sales in the country, registered a decline of three percent in the last fiscal. The SEC A and SEC B households, together, contributed to over ninety per cent of the notebook sales in the household segment. Notebooks have also started to make rapid inroads into the SEC C as well.

The Server Market:
  • Sales of servers declined two percent in FY 2008-09. Bangalore, Pune and Hyderabad, the key centres of IT/ITES witnessed a decline of 78% in consumption of servers. However, driven by the need for consolidation, server consumption in large enterprises grew by thirty-five percent. Sales to small and medium enterprises declined one percent and twenty-nine percent respectively.

The Internet entities:
  • The number of active Internet entities increased to 8.6 million subscriptions by March 2009, while the figure was 7.2 million units in March 2008. With this, the number of internet users exceeds sixty million. Internet penetration by entities in the top twenty-two cities was forty-seven per cent among businesses and twenty-four per cent among households. The businesses segment now accounts for twenty-eight per cent of the total active Internet entities and households account for the remaining seventy-two per cent.
  • DSL/cable remains the most commonly used means of Internet connectivity among businesses: forty-five per cent of businesses were found to use DSL/cable, thirty-one per cent dial-up connections, seven per cent leased-line, four per cent used data cards, one per cent used VSAT while eleven per cent ISDN services.

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Shinde asks IPPs to add extra 4000 MW in 2009-10

Union Power Minister Sushil Kumar Shinde today told private power producers that they must ensure another 4000-5000 MW of capacity addition during the current financial year, of which 900 MW must come by the end of August.

Mr Shinde was speaking at a meeting with independent power producers here as part of his efforts to give an impetus to the electricity generation capacity addition programme.

The private sector is expected to add 6125 MW in the current fiscal, of which 2019 MW has already been commissioned.

Mr Shinde assured the producers that he would resolve all issues that were acting as hindrances in the progress of the power sector. He urged the private sector to join hands with the government to fulfil the dream of Power for All by 2012.

He urged the independent producers to set up a five-member committee which could take up with the Power Ministry issues related to them on a regular basis.

The minister also urged the private sector to make more efforts to enhance the availability of skilled manpower by adopting ITIs in the locality of their plant. This, he said, will not only create job opportunities for the young and upcoming but will also address the problem of shortage of manpower.

About 18 major independent power producers attended the meeting. Power Secretary H.S. Brahma, Special Secretary, Ministry of Coal, Dr. S.P. Seth, Central Electricity Authority Chairman Rakesh Nath, other senior officials from Ministry of Power as well the heads of Power Finance Corporation, Power Grid Corporation and Rural Electrification Corporation were present at the meeting.

Some of the independent power producers raised issues such as coal linkages, transmission, fuel transportation and coordination with state governments and sought the intervention of the Power Ministry.

Among other things, the meeting decided to approach the Ministry of Petroleum to provide more gas from the Krishna-Godavari basin to the power sector. The Ministry of Environment and Forests would be approached to expedite environmental clearances for projects.

The total targeted capacity addition for the 11th Plan is 78,700 MW out of which 19554 MW or 25 per cent is expected from the private sector. New capacity of 3,742 MW has already been commissioned and the rest is under construction. The private sector is expected to add about 42,000 MW in the 12th Plan.

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No intention of monetising debt: Mukherjee

Finance Minister Pranab Mukherjee today made it clear that the Government had no intentions of monetising its debt and said that, during the first half of 2009-10, its market borrowing of Rs 2,41,000 crore of dated securities was being supported by the Reserve Bank of India (RBI) through its Open Market Operations (OMO).

"It has to be understood that OMO of the RBI should not be confused with monetisation of government borrowings and that the Government has no intentions of monetising its debt," Mr Mukherjee said in his reply to the debate on the Union Budget for 2009-10 in the Lok Sabha.

The Finance Minister said serious concerns had been voiced on the implications of the Government's borrowing programme undermining the cost and availability of funds for the recovery in growth of private investment.

He said the net market borrowing requirement for 2009-10 through Government of India (GOI) dated securities worked out to Rs 3,97,957 crore. The actual net borrowing through GOI securities in 2008-09 was Rs 2,21,472 crore.

"Notwithstanding the increased borrowings in the current year, the cost of borrowing has been significantly lower so far," he said.

Mr Mukherjee said that, in respect of the macroeconomic policy, it was essential that the country returned to the path of fiscal prudence without compromising its growth momentum as soon as the current economic circumstances permitted it to do so.

He said the fiscal deficit was expected to come down from 6.8 per cent of Gross Domestic Product (GDP) in 2009-10 (Budget Estimates) to 5.5 per cent in 2010-11 and further to 4.0 per cent in 2011-12. Correspondingly, the revenue deficit is expected to decline from 4.8 per cent of GDP in 2009-10 to 1.5 per cent in 2011-12, he said.

He said there were a number of factors that would make this possible. For instance, the Sixth Pay Commission arrears would have been paid out in 2009-10 with no further liability on that account in 2010-11.

He also said that the increase in plan spending as a part of the implementation of the fiscal stimulus had been in the nature of front loading of the plan expenditure approved for the Eleventh Five Year Plan. He said this could be aligned with future requirements.

According to him, much of the decline in business and corporate tax collections is cyclical and will tend to be reversed with growth expected to pick-up from the second half of the current year. He also expected the introduction of Goods and Service Tax (GST) from April 1 next year to bring in a sustained rise in tax revenues.

Mr Mukherjee said there were some early indications of recovery in the global economy and the Indian economy was also showing signs of pick-up, though uncertainties remained on several fronts.

He listed some of the positive signs in the Indian economy as a 13 per cent rise in the production of major steel producers, a 13.1 per cent increase in cement production and a 14.3 per cent growth in the sales of automobiles in June this year.

He said consumer goods continued to record a double digit growth at 12.4 per cent in May and the number of mobile phone connections had increased by 49 per cent (year-on-year) in May. Approximately, 12 million mobile phones were added during the month, he said.

The Finance Minister listed the steps being taken by the government to boost the agriculture sector and sought to allay doubts raised about the adequacy of the financial provision for the sector. He said that more than 24% of the total expenditure after excluding interest payments, defence expenditure, and salary and pension related expenditure is directly or indirectly going to the agriculture sector of the economy.

He said the government was monitoring the progress of the monsoon on a daily basis and was ready to implement its contingent plan, if required.

Stating that infrastructure was a high priority area and that rural infrastructure was of special importance, Mr Mukherjee said that, through the four fiscal packages announced so far, including the one in the July 6 Budget speech, the Centre had given an overall stimulus of nearly Rs 2,18,000 crore to the economy. The bulk of this is being directed towards investment in infrastructure, both urban and rural, as well as programmes for the common man like the National Rural Employment Guarantee Scheme, Bharat Nirman, and so on.

"To give an example, the plan outlays for rural and urban infrastructure have increased from Rs.62,647 crore in BE 2008-09 to Rs.1,24,038 crore in BE 2009-10 marking an increase of 98%. The outlays for women centric programmes across sectors have increased from Rs.27,662 crore in 2008-09 to Rs.56,858 crore in 2009-10, an increase of 105%. The outlays for minorities have increased from Rs.1000 crore in 2008-09 to Rs.1740 crore in 2009-10, an increase of 74%," he said.

On the issue of disinvestment in the public sector undertakings (PSUs), the Finance Minister said the government would enable the companies to benefit from techno-managerial efficiencies and become more competitive in the amrket. He said the Finance Ministry had initiated discussion with other ministries and departments for identifying the PSUs in which a portion of Government shareholding could be sold and for issue of fresh equity by the PSUs to meet their fund requirements. The details are being worked out and would be announced in due course, he said.

He said that the global financial crisis did not affect Indian banks or financial markets directly, but it did expose a number of weaknesses in the country's financial system.

"The events over the last two years and the outflows and inflows of FII equity more recently, has brought home with renewed force the volatile nature of certain private capital flows. Though such flows provide critical risk capital with long-term benefits to the economy, the volatile nature of these flows has a negative impact on investments decisions. We have to create the necessary policy environment that helps in addressing such concerns," he said.

"There are other issues in financial sector, such as those related to the development of long-term debt markets and deepening of corporate debt markets for improving resource flows to infrastructure investments; improving future markets for better price discovery and regulation; and overcoming institutional hurdles to better intermediation. These will have to be addressed in order to make the sector more competitive with an efficient regulatory and oversight system, which is responsive to the needs of high growth economy," he said.

Mr Mukherjee said he would look into all issues, legislative and otherwise, necessary to carry forward the economic policy reforms to their logical end.

"The focus of our policies is Aam Admi. But we are equally aware of the fact that wealth has to be created before it can be distributed. I have faith in the determination of the people of this country and the resilience of the Indian economy which has proved wrong the Cassandras of doom earlier and will do so again." he added.

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BHEL bags Rs.640 cr contract for Jharkhand power plant

The public sector Bharat Heavy Electricals Limited (BHEL) has secured an order for the main plant package of a thermal power project in Jharkhand, involving one new-rating unit of 270 MW.

A BHEL press release said the order for the greenfield power project, valued at Rs 640 crore and located in Jamshedpur district, had been placed by Adhunik Power and Natural Resources Limited (APNRL)

The new order comes close on the heels of an order for a 600 MW thermal power plant of the Korba West Power Company Limited in Chhattisgarh and is testimony to the confidence being reposed in the company by independent power producers, the release said.

BHEL had received orders from private sector customers such as Jindal Power, Jaiprakash Power Ventures, GVK Power, Hindalco, HPCL Mittal Energy Ltd, Adani Power, Tatas and ACC during 2008-09, it said.

In the new contract, BHEL's scope of work envisages design, engineering, manufacture, supply, erection and commissioning of steam turbine, generator and boiler, along with associated auxiliaries and electricals, besides state-of-the-art controls & instrumentation and electrostatic precipitators (ESPs), the release said.

According to it, BHEL has established state-of-the-art technology for the manufacture of thermal sets up to 1,000 MW rating. The company has also introduced new rating thermal sets of 270 MW, 525 MW and 600 MW to meet customer demand.

In fiscal 2008-09, the installed capacity of BHEL-supplied utility sets went up to 87,646 MW and the company maintained its share of 64 % in the country's total installed capacity of 1,38,175 MW.

The company has enhanced its manufacturing capacity to 10,000 MW per annum and is further augmenting it to 15,000MW per annum. Plans are being drawn up to hike it further to 20,000 MW by 2011-12, the release added.

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NACIL's accumulated losses around Rs 7200 cr: Patel

Minister of State for Civil Aviation Praful Patel told Parliament today that the accumulated losses of the National Aviation Company of India Limited (NACIL), which runs national carrier Air India, as on March 31 this year was likely to be in the region of Rs 7200 crore.

NACIL was established in 2007 to facilitate the merger of Air India and Indian Airlines, both state-owned national carriers.

In a statement in the Rajya Sabha in reply to a Calling Attention Motion tabled by Mr Prakash Javdekar of the Bharatiya Janata Party and other members regarding the deteriorating financial condition of Air India and the action taken by the government, Mr Patel said that Air India and Indian Airlines had incurred losses of Rs 541.30 crore and Rs 230.97 crore, respectively, during 2006-07 before the merger.

He said that, in 2007-08, the combined airline posted a loss of Rs. 2226 crores and during 2008-09, the expected loss is approximately Rs.5000 crores.

Mr Patel also pointed out that the equity base of Air India is only Rs 145 crore. He said the government, in the past, had never assisted Air India, unlike governments in other countries which came to the aid of their airlines when they were placed in a similar difficulty.

He said that, in the post-merger period, a plan for an initial public offer (IPO) was mooted but the market conditions then were not conducive to that process.

It is in this background that an equity infusion and soft loan by the Government as a measure of softening the adverse financial situation is contemplated," he said.

The minister also pointed out that, over the past year, there had been a surge in oil prices that had adversely impacted the cost of operations in the airlines and deteriorated its financial position further.

"The airline has also suffered from high fixed cost as also high expenditure on insurance, interest on working capital, aircraft loan, and on leasing of aircraft, that have not been matched with corresponding percentage increases in revenue," he said.

According to him, Air India also has to incur huge costs on operating non-economic flights in national interest which have not been compensated for by adequate revenue. These include flights to the North-East region, Andaman & Nicobar Islands, transportation of Army troops, transportation of Haj pilgrims, disaster relief and other unprofitable but necessary operations that have been entirely in the country’s interest, he said.

Mr Patel listed various measures the airline had adopted to improve its financial position. These include rationalization of routes to cut losses on traditionally loss making routes, rescheduling/cancellation of future aircraft deliveries, return of leased capacity at the earliest, a complete rationalization of manpower and productivity linked incentives including large scale redeployment of staff to curb infructuous expenditure, and reduction of contractual employment.

The airline is also reviewing all agreements on all technical and operational matters and is aligning all operational and technical agreements to reflect present market conditions, he said.

He said the airline had constituted a turnaround committee, comprising representatives from senior management and the employees union to look at all areas of cost reduction, including closure of all offline offices and reduction of employees at foreign stations.

At the outset, Mr Patel dwelt on the background in which the government had liberalised the civil aviation sector, keeping in view the rapid increase in the demand for both domestic and international air services.

The demands of economic growth, trade and infrastructure development placed upon the sector an immense requirement for increase in capacity, he said.

The minister said the removal of constraints in capacity, both in terms of the number of routes as also number of aircraft was urgently needed. From only 100 aircraft available before the turn of the century, the number has grown to approximately 400 today. During this time, the annual growth projections in capacity were about 30%. Thus, apart from liberalising to allow more airline operators in the market, a fleet expansion plan was conceived for Air India and Indian Airlines, he said.

Mr Patel said the competition that ensued afforded better service to the Indian public as also much more economical and affordable prices.

In this backdrop, Air India also needed to compete at the enhanced levels of service expected by today’s passengers. The ageing fleet of the national carriers needed replacement, and, towards this end, orders for 111 aircraft were placed upon Boeing and Airbus for its fleet replacement and expansion programmes, he said.

He pointed out that until then the two airlines were beset by image problems, with old aircraft and frequent delays caused by technical defects. The cost structure of operating old aircraft thus impacted upon the profitability of the airline.

He said even after 50 of the new aircraft had been inducted about half the combined fleet of Air India and Indian Airlines was more than 15 years old.

While the airline began the process of modernisation, its losses have been mounting because of the present economic recession which has lowered seat occupation factors tremendously as well as forced all airlines, worldwide, to drop fares in the highly competitive market, he said.

This had lowered yield , causing all airlines to suffer operating losses, Mr Patel said.

"Losses in Air India thus reflect a common economic problem of all airlines worldwide. Worldwide economic losses expected in the year 2009-10 are expected to be around $9 billion," Mr Patel added.

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Expert group suggests setting up of Institute of Valuation Professionals

FICCI Secretary General and Chairman of the Expert Group on ‘Regulation of Valuation Professionals’, Dr. Amit Mitra submitting the report to Corporate Affairs Minister Salman Khurshid on Tuesday.
FICCI Secretary General and Chairman of the Expert Group on ‘Regulation of Valuation Professionals’, Dr. Amit Mitra submitting the report to Corporate Affairs Minister Salman Khurshid on Tuesday.
An expert group constituted by the government has recommended the setting up of an Institute of Valuation Professionals as an independent and autonomous corporate professional body.

The group, chaired by Dr Amit Mitra, Secretary General of the Federation of Indian Chambers of Commerce and Industry (FICCI), had been set up to examine and make suggestions on the draft legislative proposals for regulation of valuation professionals.

Dr Mitra submitted the report to Minister of State (Independent Charge) for Corporate Affairs Salman Khurshid here today.

The group said the proposed institute would function more as a regulatory and technical body and play a promotional and facilitation role to ensure high quality education and examination systems for the valuation profession.

The group had gone into issues pertaining to the statutory framework for the regulation of valuation professionals, in general, and the scope of the proposed Bill, in particular.

The other members of the group, constituted by the Ministry of Corporate Affairs in November last year, were Mr. Bansidhar S Mehta, Past President, Institute of Chartered Accountants of India (ICAI), Mr. Ashwani Puri, Expert, Valuations and Insolvency, PriceWaterhouse Coopers, Mr. Ashok Haldia, Past Secretary, ICAI, Mr. Chandra Wadhwa, Past President, Institute of Costs and Works Accountants of India (ICWAI), Mr. Bharat Wakhlu, Tata Services Limited, Mr. Jitesh Khosla of the Indian Institute of Corporate Affairs, and Mr. Jaikant Singh, Director, Ministry of Corporate Affairs. Mr. Arun Chawla, Senior Director, FICCI, was a Permanent Invitee to the group.

The group stressed the need to lay a strong foundation for evolution and development of the valuation profession in India and recommended that the proposed institute be governed through a Council of Valuation Professionals.

The disciplinary and quality review mechanism would largely be independent of the council, generating greater public confidence and structured to enquire and decide cases of professional negligence expeditiously.

Amongst other important recommendations made by the group are that the statute should focus on business valuation since it covers key corporate actions affecting stakeholders' interests and would therefore improve corporate governance.

The group has also suggested suitable legislative measures to integrate, within the framework, experts in valuation of different kinds of physical assets which can materially impact the value being ascertained by the business valuer in the course of this professional work.

To bring professional standards to a uniform level and ensure unbiased certification of valuers, the group has also recommended a common certifying examination to be conducted by the proposed institute.

The group said the development of practice of valuation as a discipline and profession in the present-day context had become a necessity because of the imperatives of financial markets, emerging global economy, and changing framework of accounting and financial reporting.

It, therefore, felt that, in view of the growing significance of business valuation, it was imperative to have a well-developed valuation discipline built upon the requisite academic curriculum and technical standards and supported by an institutional and regulatory framework.

It was convinced that India would be able to develop high quality technical standards on valuation and equally high quality in valuation professionals only when it was recognised as a separate discipline and pursued as a well-organised profession.

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ONGC has negative net present value for investment in Cairn's Rajasthan block: Deora

The public sector Oil and Natural Gas Corporation (ONGC) has a negative net present value for its investment in Cairn India's Rajasthan block under the revised field development plan (FDP) and the existing set of fiscal terms and conditions, Petroleum Minister Murli Deora said today.

Mr Deora told the Rajya Sabha in a written reply today that while the ONGC Board had not approved the investment plan of Cairn India, it had approved its 30 per cent share of the revised FDP at an estimated expenditure of US $ 729.43 million in respect of block RJ-ON-90/1.

The total capital expenditure estimated in the FDP is US $ 2.431 billion, he said.

Cairn India is a subsidiary of Cairn Energy of the United Kingdom and holds 70 per cent of the stake in the block while ONGC holds the rest.

Mr Deora said the main reasons for the increase in cost in the revised plan were the increase in plateau production rate from 96,000 barrels of oil per day (BOPD) to 125,000 BOPD, change in production and processing from individual gathering stations to a central process hub, updated cost estimates and increase in service tax.

He said the projected crude oil production from the block is 2.6 million metric tonnes (MMT) in 2009-10 and 6.8 MMT in 2010-11, with peak production of 8.9 MMT per annum.

With this incremental production from Rajasthan, crude oil production of the country is likely to increase by 7.8% in 2009-10 and 20.3% in 2010-11, he added.

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Domestic airlines carry 109.38 lakh passengers in April-June

Scheduled airlines in India carried a total of 109.38 lakh domestic passengers between April and June this year as against 98.22 lakh passengers in the first quarter, an official statement said here today.

Of this, Kingfisher Airlines accounted for 27.2 lakh passengers, Air India for 19.18 lakh, Jet Airways for 17.80 lakhs, Jet Lite for 8.11 lakh, Indigo for 14.98 lakh, Spice Jet 13.57 lakh, Go Air for 5.34 lakh and Paramount 2.30 lakh.

However, the number of passengers carried by the domestic airlines in the first half of this year (January-June) declined by 8.05 per cent to 210.99 lakhs from 229.45 lakhs in the same period of last year, the statement said.

The total number of domestic passengers carried by the scheduled airlines in June this year was 36.94 lakhs.

Of these, Kingfisher carried 9.01 lakh passengers, Air India 6.45 lakh, Jet Airways 6.12 lakh, Jet Lite 2.71 lakh, Spice Jet 4.74 lakh, Indigo 5.04 lakh, Go Air 2.01 lakh and Paramount 0.73 lakh.

Kingfisher had a 24.4 % share of the passengers in June, followed by Air India 17.5 %, Jet Airways 16.6 %, Indigo 13.6 %, Spice Jet 12.8 %, Jet Lite 7.3 %, Go Air 5.4% and Paramount 2.0 %.

The percentage share of the carriers in the second quarter of 2009 was Kingfisher 25.3 %, Air India 17.5 %, Jet Airways 16.3%, Indigo 13.7 %, Spice Jet 12.4 %, Jet Lite 7.4%, Go Air 4.9 % and Paramount 2.1%.

The seat factors of the domestic airlines in June 2009 were Air India 67.9%, Jet Airways 67.8%, Jet Lite 74.4%, Kingfisher Airlines 72.0%, Spice Jet 77.3%, Paramount Airways 88.2%, Go Air 85.1% and IndiGo 81.7%.

In a separate statement, the Ministry of Civil Aviation said that the overall on-time performance (OTP) of the scheduled domestic airlines for June was 81.6 per cent, excluding Paramount Airways.

Air India, including its subsidiary Alliance Air, had an OTP of 75.7 %, Jet Airways 86.4 %, Jet Lite 80.4 %, Kingfisher 83 %, Spice Jet 76.9 %, Go Air 83.4 %, Indigo 87 % and MDLR Airlines 67 %.

The statement said the OTP of Paramount had not been included because of ambiguity in figures furnished.

The overall per cent cancellation of scheduled domestic departures in June was 1.8 per cent.

Air India cancelled 1.1 % of its departures, Jet Airways 4.1 %, Jet Lite 2.4 %, Kingfisher 1.5 %, Spice Jet 1.3 %, Go Air 0.3 %, Paramount 16 %, Indigo 0.2 % and MDLR 2.6 %.

According to the statement, the cancellation rate of Paramount Airways (16 %) was on the higher side and well above the industry average. Out of these 16 % cancellations, about 15 % were due to technical reasons and 1 % due to commercial reasons, the statement added.

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IndusInd Bank ties up with Maruti Suzuki for car loans

IndusInd Bank and leading car maker Maruti Suzuki India Ltd today announced a strategic tie-up for financing Maruti vehicles on an all-India basis.

As per the agreement, Maruti Suzuki has nominated IndusInd Bank as its preferred financier for financing all Maruti vehicles.

A press release said IndusInd would offer financing facilities to all eligible customers for purchasing Maruti vehicles through its network of 180 branches across India.

Apart from this, the bank also operates through its 484 distribution outlets, which could be leveraged by Maruti Suzuki.

Announcing the tie-up, Mr. S V Parthasarathy, Executive Vice President (Consumer Finance Division), IndusInd Bank, said, "This strategic alliance is a part of our expansion strategy in the consumer finance segment. We have wide distribution network covering urban, semi-urban and rural areas. We can leverage on our network base of two million customers for mutual benefit. We see excellent synergy in this relationship for both the organisations."

Mr R.S.Kalsi, Chief General Manager, Maruti Suzuki, said, "Maruti Suzuki is keen to expand its presence across the country including rural and semi urban markets. We have the right products and a nationwide sales and service network to support this growth. We feel that car finance needs personalised focus and attention. We are confident that with partners like IndusInd Bank, we will win customer confidence and achieve the objective of greater penetration. We are happy that IndusInd Bank is partnering with Maruti Suzuki to offer transparent, hassle-free finance options to our customers."

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Railways record 9.59 % increase in freight traffic in June

The Indian Railways carried 71.53 million tonnes of revenue earning freight traffic in June this year, an increase of 9.59 per cent over the figure for the same month of last year.

An official press release said here today that the Railways had carried 65.27 million tonnes of freight traffic in June, 2008.

In the first three months of this financial year (April-June), the Railways carried 213.09 million tonnes of freight traffic.

This marked an increase of 4.97 per cent over the level of 203 million tonnes actually carried during the corresponding period last year, the release added.

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NSPCL's Bhilai power plant achieves full load capacity

The Bhilai Expansion Power Project of the NTPC-SAIL Power Company Private Limited (NSPCL), a joint venture of the Steel Authority of India Limited (SAIL) and NTPC Ltd, has achieved its ultimate capacity of 500 MW.

The occasion yesterday was attended by Union Power Minister Sushil Kumar Shinde, Union Steel Minister Virbhadra Singh, Chhattisgarh Chief Minister Raman Singh and Union Minister of State for Power Bharatsinh Solanki in Bhilai.

With the full load operation of 2 x 250 MW of the plant, the total capacity of NSPCL’s captive power plants has risen to 814 MW, an official press release added.

The plant provides captive power for SAIL's Bhilai units.

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NTPC to set up 4000 MW power project in Chhattisgarh

The Principal Secretary (Energy), Chhattisgarh Govt., D S Misra and NTPC CMD R S Sharma signing an MoU for setting up 4000 MW power project at Lara in Raigarh by NTPC and Chhattisgarh Govt. in the presence of the Power Minister Sushilkumar Shinde, Chattisgarh CM Raman Singh and the Minister of State for Power Bharatsinh Solanki, at Raipur, Chhattisgarh on Sunday.
The Principal Secretary (Energy), Chhattisgarh Govt., D S Misra and NTPC CMD R S Sharma signing an MoU for setting up 4000 MW power project at Lara in Raigarh by NTPC and Chhattisgarh Govt. in the presence of the Power Minister Sushilkumar Shinde, Chattisgarh CM Raman Singh and the Minister of State for Power Bharatsinh Solanki, at Raipur, Chhattisgarh on Sunday.
Public sector power major NTPC Limited has signed three major memoranda of understanding (MoU) with the Chhattisgarh government, including one for setting up a 4000 MW power project at Lara in Raigarh district.

The other two MoUs are setting up an International Institute of Information Technology (IIIT) and an Industrial Training Institute (ITI) at Baloda in Champa-Janjgir district of the state, an official press release said here today.

The MoUs were signed in Raipur, the state capital, yesterday in the presence of Union Power Minister Sushilkumar Shinde, Chhattisgarh Chief Minister Raman Singh, Minister of State for Power Bharatsinh Solanki and senior Congress leader Motilal Vora, among others.

Power Seretary Harishankar Brahma, Chhattisgarh Chief Secretary P Joy Oommen and NTPC Chairman and Managing Director R S Sharma were also present.

The 4000 MW project, comprising five units of 800 MW each, would benefit the states and union territories of Western India and is scheduled to be completed during the XII Plan period (2012-17).

The proposed IIIT will focus on areas such as bioinformatics, information and communication technology, Very Large Scale Integration (VLSI) and Embedded Systems, computer-aided structural engineering and so on. It will offer a range of degree programmes as well as diploma and certificate courses.

The new ITI is aimed at increasing employability and ensuring availability of technical manpower in the region.

NTPC, with an installed capacity of 30,644 MW, is India’s largest power generation company with 15 coal-based, seven gas-based and four joint venture power stations.

With 18.79% of India's installed capacity, NTPC contributes around 28.60% of its power generation. The company is aiming to become a 50,000 MW company by 2012.

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Pawar opens Fish Festival at Hyderabad

Agriculture and Food Minister Sharad Pawar today said the government attached high priority to fisheries and was exploring all possibilities for the integrated development of the sector.

Inaugurating the Indian Fish Festival (INFISH) 2009 here, Mr Pawar said such exhibitions would be organised in different places in the country every year to reach out to larger sections of stakeholders.

Mr Pawar also laid the foundation stone of the new office of the National Fisheries Development Board (NFDB) here.

The exhibition has been organised jointly by the NFDB and the government of Andhra Pradesh.

Andhra Pradesh Chief Minister Y S Rajashekara Reddy and Union Minister of State for Agriculture K V Thomas were amongst those who spoke on the occasion.

"The annual growth rate of over 4% in fisheries is indicative of the immense opportunity in the coming years. It is in this context that the Government of India is exploring all possibilities for integrated development of fishery sector and establishing NFDB is one major step in this direction," Mr Pawar said.

He said that, while focusing on production, there was also a need for promotion of domestic market for ensuring remunerative prices to the producers. This could be achieved by educating the general public on the nutritional and medicinal values of fish.

INFISH 2009, he said, was focusing on promoting fish as a health food by encouraging setting up of food courts exclusively dedicated to fish and fishery products.

The minister appealed to the Chief Minster of Andhra Pradesh to focus on women self-help groups as an important livelihood promotion opportunity in the State. He expressed happiness over the fact that about seven lakh women self help groups were financially well supported through several banks in Andhra Pradesh. The Minister also advised the Marine Products Export Development Authority (MPEDA) to focus on export of ornamental fish.

Mr Pawar spoke about the vast potential of fisheries in India and the need for promoting new technologies.

"India is not only a maritime country but also an important aquaculture country in the world, holding third position in global production and second place in aquaculture, next only to China. The contribution of Indian fish to the food basket of the world has been substantial. Fishery products also constitute the largest group of our agriculture exports," he said.

He said India had a potential of 12 million tonnes from the fisheries sector. Against this, the government was hoping to achieve a production level of 10 million tonnes by the end of the XIth Plan period (2007-12).

He praised the work being done by the Indian Council of Agricultural Research (ICAR) and other institutions and said technology must be taken to the doorstep of the user community.

‘I am glad to see the variety of technologies displayed by the ICAR Research Institutions, the Fisheries Institutions of Government of India, Universities, private sector etc. The display of various species of fishes along with feeds and feed supplements and culture practices would help the farmers in choosing the right candidate species for intensive and extensive aquaculture in tanks, ponds and reservoirs," he added.

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TRF acquires Dutch Lanka Trailer Manufacturers

TRF, a part of the Tata Group, today said it had signed an agreement to acquire Dutch Lanka Trailer Manufacturers (DLT).

A press release issued by the Tata group said TRF would, in the first phase, acquire 51 per cent of equity shares at a consideration of US$ 8.67 million. It would also sign a call and put option agreement for acquisition of balance 49 per cent of equity shares at a consideration of US$ 8.33 million.

According to the release, DLT has a manufacturing facility in Sri Lanka and sells trailers in as many as 30 countries. Dutch Lanka Engineering, a 100 per cent subsidiary of DLT in Sri Lanka, is engaged in repairs, maintenance and service business for trailers.

DLT also has a subsidiary in Oman which manufactures and sells trailers in the West Asian markets. Through its joint venture with Tata International in India, DLT manufactures and sells trailers in India.

TRF plans to grow rapidly – five times in five years – and become a Rs 2500-crore company by 2013, by enhancing focus on material handling business and entering new businesses as necessary, the release said.

Recently, TRF had entered into a shareholders' agreement along with Tata Capital and Jasper Industries to form a joint venture, Adithya Automotive Applications, with the main objects of engaging in the business of automotive applications to provide end solutions through fabrications and machining for vehicles to be used as tippers, load bodies, trailers, refrigerated bodies and so on.

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Infosys reports 17.3 % rise in Q1 profit, cuts rupee outlook for FY

Infosys Technologies Ltd, India's second-largest software services exporter, today reported a net profit after tax of Rs 1527 crore for the quarter ended June 30, an increase of 17.3 per cent over the corresponding quarter of the previous year.

Its results for the first quarter of the financial year 2009-10 showed that its revenues grew by 12.7 to reach Rs 5472 crore in the period.

The company said earnings per share increased to Rs 26.66 from Rs 22.75 in the corresponding quarter of the previous year, representing a year-on-year (YoY) growth of 17.2 per cent.

A company press release said Infosys and its subsidiaries added 27 clients during the quarter. It also reported a gross addition of 3538 employees (net decline of 945) for the period. The company and its subsidiaries had 1,03,905 employees as on June 30, the release said.

“We believe that in the short term the global economic environment will continue to be challenging,” Mr S. Gopalakrishnan, Infosys CEO and Managing Director, said.

“We are working closely with our clients to help them navigate the downturn. We continue to invest in the future to take advantage of the growth opportunities in the medium to long term.”

About the outlook for the next quarter, ending September 30, Infosys said income was expected to be in the range of Rs 5318 crore and Rs 5413 crore, representing a YoY decline of 1.9 % to 0.1 %. Earnings per share are expected to be in the range of Rs 23.67 and Rs 24.09,  a YoY decline of 5.4 % to a growth of 0.3 %.

For the fiscal year ending March 31, 2010, the company expected income to be in the range of Rs 21,416 crore and Rs 21.747 crore, representing a YoY decline of 1.3 % to a growth of 0.3 %.

Earnings per share is expected to be in the range of Rs. 94.59 and Rs. 96.00, representing a YoY decline of 9.6% to 8.2%, the press release said.

The company said it continued to win transformational deals, solution-based engagements, and systems integration projects.

“We continue to win large deals. We have also benefited from vendor consolidation with certain clients,” said Mr S.D. Shibulal, Chief Operating Officer.

“Our breadth and depth of services and solutions enable us to remain engaged with clients and deliver value to them in this challenging economic environment.”

The company said it had cash and cash equivalents, including investments in liquid mutual funds and certificate of deposits, of Rs 12,030 crore as on June 30 this year as compared to Rs.7,411 crore as on June 30, 2008.

“The global currency markets continue to be volatile. During the quarter, the rupee appreciated against the US dollar,” said Mr V. Balakrishnan, Chief Financial Officer. “We continue to focus on margins while making the right investments to accelerate growth.”

Mr T V Mohandas Pai, member of the Infosys Board and Head-HRD and Education & Research, said the company had invested more in training to enhance our productivity.

“We are honoring all our earlier offers. iRACE, our program for career architecture, is currently being rolled out," he said.

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DIAL wins bid to generate power from Delhi municipal waste

The Delhi International Airport (P) Limited (DIAL), a company led by the infrastructure major GMR Group, has, in collaboration with Selco International, won a bid to set up a municipal solid waste processing complex here.

The complex, to be set up on Build, Own, Operate and Transfer (BOOT) basis, would process solid waste generated by the city of Delhi to generate electricity.

The Municipal Corporation had invited bids from reputed firms to set up the facility to handle 1300 tonnes per day (TPD) of municipal waste.

Apart from being an environmentally friendly way to process the waste generated by Delhi on a daily basis, the project would also help to meet the energy needs of the perenially power-hungry city, a DIAL press release said.

The bid is being managed by New Delhi Waste Processing Company Limited, a joint venture formed by the government of Delhi and Infrastructure Leasing and Financial Services (ILFS) Ltd.

The plant to be based on Refuse Derived Fuel Technology will come up on a site in Ghazipur, Delhi, with the land being provided by the government of Delhi, it said.

DIAL is currently involved in the modernisation and development of Delhi's Indira Gandhi International Airport (IGIA).

Solid Waste to Electricity Company (SELCO) International Limited is the leader in the energy recovery field from municipal solid waste (MSW) management. SELCO set up the first commercial municipal solid waste-processing unit in India in 1999. SELCO is also involved in R&D efforts in energy recovery.

DIAL is a joint venture company comprising the Bangalore-based GMR Group, Airports Authority of India, Fraport, Malaysian Airport and the India Development Fund.

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Mahindra Satyam signs multi-million dollar SAP deal with GSK

Mahindra Satyam, the new brand identity of Satyam Computer Services, one of India's leading IT service providers, said today it had signed a new five-year support contract with GlaxoSmithKline (GSK) to provide SAP and other critical systems support to GSK's businesses around the world.

A press release from Mahindra Satyam said Satyam had been working with GSK since 2002 in providing IT application development and support services.

Mr Bill Louv, Chief Information Officer, GSK said, "GSK is delighted to be able to extend our contract for another 5 years. We look forward to continuing to receive the high level of professionalism and commitment from Satyam and its associates that we have experienced over the past 7 years."

"GSK’s selection truly recognizes the competitive spirit and resolve of the associates of Mahindra Satyam, whose skills, commitment and delivery excellence were unmatched," said CP Gurnani, CEO of Mahindra Satyam. "This is a reflection of the fact that we are well on our way to regain our position as a market leader and we are thankful to GSK for having reposed their faith in us."

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Aegis acquires CCN Group of Safrica

Aegis Limited, a business process outsourcing (BPO) provider and part of the Essar Group, today said it had acquired 100 per cent equity of CCN Group Pty Ltd, one of the largest privately owned contact centre outsourcing companies in South Africa.

An Essar Group press release said CCN Group, which has been in the BPO business for the last seven years, has revenues in excess of R 150 million (US $ 19 million) for the financial year 2008-09.

Its clientele includes both onshore and offshore customers with significant revenues from clients located in the United Kingdom. It has a capacity of 700 seats and has over 1000 employees operating out of two facilities.

"CCN is a strategic fit for Aegis. This combined entity will offer CCN’s clients and prospects an expanded set of solutions and services from a broader geographic delivery platform. South Africa becomes an integral part of our growth strategy and offers an opportunity for Aegis to develop skills, create employment and bring in international experience to South Africa. This is a step towards our commitment to creating 5000 jobs in South Africa over a period of time," Mr Aparup Sengupta, Global CEO and Managing Director of Aegis Limited said.

Mr Lawrence Brick, CEO of CCN said "We are confident that CCN has found a worthy parent to guide its future growth. We believe this transaction creates a win for our customers, employees and stockholders. With this transaction, Aegis proves its commitment to develop South Africa as a destination for international businesses."

Mr Sandip Sen, Global Chief Marketing Officer and Head of Sales at Aegis said "We saw a good synergy in CCN and Aegis culture. We share a similar passion to deliver high quality services and are delighted to integrate CCN with Aegis. We are putting in significant amount of our overall South Africa planned investment of R 500 million (USD 60 million) into this acquisition. This is our way of demonstrating long term commitment to this market place. With more than 33,000 employees globally, Aegis is well positioned to right shore customized solutions to meet today’s business needs. Additionally, the clients will benefit from greater scale, deeper domain expertise, comprehensive and flexible solution offerings, robust financial strength, and a rich international talent pool."

Aegis has a successful history of integrations in the last four years, including its acquisition in October 2008 of PeopleSupport, Inc., a NASDAQ listed outsourcing firm. This would be the 12th acquisition for Aegis, while the next one, UCMS in Australia is still awaiting regulatory approval for closing, the release added.

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HCC bags Rs 387 cr order for Bhutan power plant

Engineering and construction major HCC today said it had bagged the Rs 387.50 crore order for Lot ! of the 114 MW Dagacchu Hydro Power Project in Bhutan.

The project involves the construction of diversion weir, intake, connection channel and tunnel to desilter, desilter, flushing channel, headrace channel, headrace tunnels, surge shaft, pressure shaft, powerhouse and transformer caverns, control building and tailrace tunnel.

The client is Dagacchu Hydro Power Corporation and the project, coming up near Dagana in Bhutan, will be completed in 1239 days, an HCC press release said.

"We are happy to win this prestigious order for Dagacchu Hydro Power plant. This is the second order we have received in recent times after being awarded Package MC3 of 1200 MW Punatsangchhu-I Hydroelectric Project. HCC has recently built the Tala Hydroelectric Power project which is the largest hydroelectric project in Bhutan. With this order we further strengthen our ties with the people of Bhutan," HCC President & Chief Operating Officer Vinayak Deshpande said.

According to the release, HCC has successfully constructed over 25 per cent of India’s hydel power generation capacity, including several challenging projects in the Himalayan region.

HCC has constructed the Head Race Tunnel & Surge Shaft for India’s largest commissioned Nathpa Jhakri Hydro Electric Project (1500MW), and the Underground Powerhouse & Tunnel for the Chamera Hydro Electric Power Project, Stage I.

HCC is currently executing nine hydro-electric power projects, including four in Jammu & Kashmir, two in Himachal Pradesh and one each in Uttarakhand, Sikkim and West Bengal, it added.

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Govt denies monetization of deficit

The government today denied reports in a section of the media which suggested that it was resorting to partial monetization of its deficit.

Referring to the reports, the Finance Ministry said in a statement that it appeared that the Open Market Operations (OMO) of the Reserve Bank of India (RBI) were being confused with monetization. It said OMO of the RBI were a regular tool for effective liquidity management.

"These operations are conducted as warranted by the evolving monetary and financial market conditions. The RBI can either buy or sell Government securities in the secondary market as part of its OMO. In other words, these are entirely secondary market operations. The amount of OMO and the decision to buy or sell Government securities in the secondary market are determined by the prevailing liquidity conditions in the market," it said.

The statement said that, as per the Fiscal Responsibility and Budget Management (FRBM) Act, 2003, the RBI could subscribe to primary issues of Central Government securities only up to Marc 31, 2006.

According to Section 5 (1) of the Act, the Central Government shall not borrow from the RBI except by way of Ways and Means advances to meet temporary cash requirements.

There is a provision in the Act that on grounds of national security or national calamity or such other exceptional circumstances as the Central Government may specify, the RBI could subscribe after 1.4.2006 to primary issues of Central Government securities and further such grounds shall be placed by the Government before both Houses of Parliament.

"At present, notwithstanding the 6.8 % fiscal deficit projected in Budget Estimates 2009-10, the Government does not propose to invoke the above provisions of the FRBM Act for facilitating RBI participation in the primary market for Government securities," the statement added.

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