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Oil PSUs merger will lead to job losses: Advisory committee
New Delhi: The Advisory Committee on restructuring of oil PSUs has ruled out merger of the oil entities. The committee was constituted six months back to consider consolidation in the oil sector. A merged entity or entities, with enhanced financial powers was to be looked at by the committee.

In the last six months, the "Synergy in Energy" committee members deliberated in detail on various merger options. The committee has noted in its report that mergers and consolidations worldwide occurred during times of low oil prices and between companies that were already vertically integrated. Hence, they became a means for eliminating excess workforce and duplicate facilities. In the Indian context, despite some efforts at vertical integration, the oil PSUs retain their distinct areas of competence. The committee has also ruled out a merger on the grounds that it is likely to lead to loss of jobs.

The committee has laid greater focus on domestic exploration through new technologies as also on pursuing overseas oil and gas acquisitions aggressively.

It has accordingly set stiffer targets for meeting at least 15% of crude oil imports of 80 million tonne per annum through the oil equity route. It has, therefore, recommended creation of multiple entities. Towards this end, it has suggested setting up Oil India Videsh Limited (OIVL) as an independent subsidiary of Oil India Limited (OIL).

ONGC Videsh Limited (OVL) will pursue larger acquisitions of over 2 million tonnes of oil and gas equivalent. In the last fiscal, OVL has already achieved 5 million tonnes of oil and gas equivalent and by the end of 2007, it expects to achieve a target of around 9.5 million tonnes per annum of equity oil and gas abroad.

Achieving the targets set up the committee by OVL is not a difficult task. More than 3 mtpa of equity oil is already coming from Sudan and around one million tonnes equivalent of gas from Vietnam.

Another 2.5 mtpa will come from Sakhalin as OVL's share by 2006 end and an additional 2.5 mtpa is what OVL can buy from Rosneft at the market price. OVL's 5A property in Sudan will start producing by 2007 and the likely share of oil equity will be around 0.5-1.5 mtps by 2006-07, senior officials from oil PSUs said.

The committee has also suggested unbundling the supply and transport services of GAIL India Limited. "Unbundling of a gas monopoly in specific terms is required to facilitate competition and to reduce conflict among entities," it said.
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Ministry of Textiles expects 25 per cent growth in exports
Coimbatore: The Ministry of Textiles expects textile exports to post a 25 per cent growth this year and it pins its hopes on the upbeat mood being seen in the manufacturing sector, which is in the thick of modernising its production line.

Though the data from the Director General of Commercial Intelligence and Statistics (DGCIS) for textile exports up to May this year had revealed a 10 per cent decline overall, the figures from the US and European Union customs authorities on shipments from India are different, according to officials in the Ministry of Textiles.

While US imports from India up to April this year had revealed a 24 per cent rise, in the case of the EU, it was up 11 per cent. The Ministry is piqued by this conflicting data. Officials said that the Ministry has roped in some professional bodies to undertake a study on these discrepancies to arrive at the right status. They said that the results would be known in a month's time.
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CMIE: Inflation likely to grow by 5.7 per cent in FY06
New Delhi: The Centre for Monitoring Indian Economy (CMIE) has said that, inflation is likely to grow by 5.7% in the current fiscal ending March 2006, compared to the 6.4% rise in 2004-05.

The average inflation for the first 12 weeks of 2005-06 works out to 5.2% compared to 5.3% in the same period last fiscal. The erratic progress of the southwest monsoon would have an impact on agriculture production and may lead to rise in prices of primary articles, it said.
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