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Independence Day broadcast: PM says focus to be on infrastructure development
New Delhi: In his address to the nation, on the occasion of the country's independence day, the Prime Minister, Dr Manmohan Singh, presented the Government's action plan for achieving rapid economic growth through investments in infrastructure, rural development, and urban renewal.

Addressing the nation from the Red Fort, Dr Singh said that economic growth was intrinsically linked to the availability of infrastructure, particularly Railways, roads, and power.

The PM announced that dedicated rail freight corridors would be developed between Delhi and Kolkata and Delhi and Mumbai at an investment of over Rs25,000 crore.

Simultaneously, even as the development of national highways was progressing at a rapid pace, work had begun on an additional 30,000 km, along with six-laning of the Golden Quadrilateral.

To encourage civil aviation, world-class airports are being constructed in many cities while seaports were being modernised and new ones being built.

The Prime Minister identified shortage of electricity as a major inconvenience and stressed the need to increase power generation rapidly. Referring to his recent US visit, Dr Singh said that he had managed to eliminate some of the constraints that had been hampering the growth of India's nuclear energy programme; in the next 10 years, 40,000 MW could be generated through nuclear energy in addition to the 1,50,000 MW capacity being added in the thermal and hydro sectors.

On urban renewal, the Prime Minister said that one-third of the population lived in urban areas today and with the speed at which urbanisation was taking place, very soon 50 per cent of India's population would be living in urban areas. "We will be investing in urban areas and for this, a National Urban Renewal Mission has been launched."

As for rural development, he mentioned the Bharat Nirman programme launched by the Government under which one crore hectares of un-irrigated land would irrigated; all villages with population of 1,000 or more and hilly areas with a population of 500 or more would be connected by roads; two-and-a-half crore houses would be given electricity connections and over 60 lakh houses would be built in villages.
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IACC: Utilise foreign reserves for infrastructure projects
New Delhi: The Indo-American Chamber of Commerce (IACC) has suggested that India should utilize it's foreign exchange balance, currently around U4$140bn, for funding infrastructure projects in the country.

"The major infrastructure projects require an investment of around US$150bn. The river linking project will require an equal investment," IACC national president Ranjit Sen said through a release.

Considering the long gestation period for these projects, it is difficult to find private as well as foreign investors for these projects in their initial phase. This investment can be fetched through private-public partnership by committing a part of foreign exchange reserves, he added.

It, however, said these projects have potential to generate huge employment, which is the aim of proposed employment guarantee scheme by the government.
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PwC study: M&A deals in India increase to US$6.9bn
Mumbai: A PriceWaterhouseCoopers study on mergers and acquisitions (M&A) has said that India had the second highest growth rate in M&A activities during the first half of fiscal 2005, second only to Japan.

According to the study in the first half of 2005 deals worth US$6.9bn were announced compared with deals worth US$2.9bn in the same period in the previous year. The study says that easy availability of funding, renewed business confidence and a relatively stable political and economic regime are the prime reasons leading to the high M&A activity.

According to the study, the increase in the number and value of deals in the manufacturing sector as opposed to telecom/IT deals during 2004 and the increase in outbound investments by Indian companies were the two key features of the deals. ''Both these trends are expected to continue in the coming months,'' predicts PwC.

Some of the notable deals during this period included the Holcim and Gujarat Ambuja Cement Ltd's (GACL) acquisition of a substantial stake in Associated Cement Companies (ACC) for $800 million; UB Group's acquisition of Shaw Wallace for $350 million; Tata Steel's buy out of Singapore-based NatSteel at $305 million; Videocon Group's takeover of the colour picture tube manufacturing business of Thomson for $290 million and subsequently the business of Electrolux's operations in India and others.

Other than the buoyant deal activity, private equity (PE) investment also continued to increase in the first half of 2005. Late stage investments continued to dominate the PE landscape with over 20 Private Investment in Public Equity (PIPE) deals reported through June 2005.

Large PIPE deals included a US$57 million investment in India Cement by Hong Kong-based Asia Debt Management Fund; a US$50 million investment in Jubilant Organosys by Henderson and Citigroup; and a US$50 million investment in Punj Llyod by Merlion India Fund.
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TRAI asks for incentives for cell operators to start rural operations
New Delhi: Voicing concern over the rising gap in urban and rural communication facilities, telecom regulator TRAI is asking the Govt. to offer incentives for telecom service providers to start services in the rural areas.

"The last decade saw tremendous growth in telecom sector especially in urban areas but gap in rural and urban areas has increased manifold. Mobile telephony was instrumental in urban areas and to lure them to start services in rural areas government must offer incentives," TRAI chairman Pradip Baijal told reporters at an interaction organised by forum of financial writers.

Asked about the incentives, Baijal said "TRAI is going to give recommendations on rural telephony to government soon and there all details will be provided."

On the issue of including cellular operators within the ambit of Universal Service Obligation (USO) fund, Baijal said "I feel there is no need to amend the telegraph act. As per the existing act also they can be made beneficiary of the fund as the basic operators can go to rural areas."

According to Baijal, operators would be required to add four million new users every month, compared with just around 1.5 million at present, to achieve targets set by the government of 250 million phones by 2007.

This would be possible only if telecom services were made available in the rural segment, he said.
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