document.writeln("

Pranab: IAF aircraft acquisition proposal by year-end
Mumbai: The government will finalise a proposal to purchase 126 aircraft for the Indian Air Force by the year-end, defence minister Pranab Mukherjee has said. The US F-16 along with the French Mirage 2005, the Swedish Grippen and the Russian MiG-29 aircraft are in the running for the contract.

Speaking at the meeting organised by the Indian Merchants' Chamber on "The role of the private sector in defence preparedness", in Mumbai, the minister said, "The ministry will send a request for the proposal for acquisition of 126 fighter jets by the year-end."

According to the minister, while making a defence purchase, the offset clause should be applicable. "The ministry of defence has already put in place an offset policy to leverage the country's position as a large buyer and this has been incorporated in the Defence Procurement Procedure, 2005, which has come into effect from July 1," Mukherjee said.

On the private sector's involvement, he said of the total purchases worth around Rs5,500 crore made by the defence PSUs, approximately Rs1,200 crore was obtained from the private sector engaging small, medium and large scale industries. Similarly, the Ordinance Factory Board outsource their production to the extent of Rs1,900 crore to the private industry.

Anticipating foreign investment under the permissible level of 26 per cent, a number of major private sector companies have obtained letters of intent or industrial licences for manufacturing a wide range of defence products.

"I am told that till now 23 such letters of intent have already been issued," he said.

Of the 40 recommendations made by the Vijay Kelkar Committee report on defence procurement, 21 have been accepted, five will be reviewed for modification and the rest are still under consideration. The ministry of defence has put in place an empowered committee to look into the remaining issues.

In the defence budget for 2005-2006, there is a provision for Rs83,000 crore of which the capital heads is Rs34,375 crore. A significant amount from this is set aside for import purposes, and the minister pointed out that this trend needs to be reversed.
Back to News Review index page  

Govt clears export of white sugar against raw imports
New Delhi: The Government has decided to allow export of white sugar against raw sugar imported this year under advance licence as a bumper sugarcane production of 180 lakh tonnes was expected in 2005-06, agriculture minister Sharad Pawar has said.

In keeping with its promise to bail out the crisis-ridden sugar mills, which have been facing shortage of sugarcane, the Government also waived the 10 per cent levy on imported raw sugar, which is expected to touch 24 lakh tonnes during the current sugar season ending September, 2005.

''I have decided that release orders be given to those factories which have imported raw sugar under advance licence and have export obligation to fulfill,'' Pawar said.

He said that after carefully considering the question of levy obligation on import of raw sugar under advance licence, the Government has decided to exempt them from the 10 per cent levy obligation.
Back to News Review index page  

Cabinet clears amendment to VAT regulations for two UTs
New Delhi: The Cabinet has cleared amendments to the value-added tax (VAT) regulations for Daman and Diu and Dadra and Nagar Haveli enabling the two Union territories to specify points of sale at which VAT would be imposed.

Defence minister Pranab Mukherjee told media persons after the Cabinet meeting that the Daman and Diu VAT (amendment) regulation, 2005 and the Dadra and Nagar Haveli (amendment) regulation, 2005 under Article 240 of the Constitution inserted one section and two sub-sections in the original regulations.

Section 14A would empower the governments of Daman and Diu and Dadra and Nagar Haveli to specify points of sale at which the goods may be taxed, Mukherjee said.

In the interest of simplicity, drugs and medicines could be taxed at first point at maximum retail price as recommended by the empowered committee of state finance ministers, he said. Certain goods, whose prices were not fully market determined, could also be taxed at first point like liquor, lottery tickets, petrol, diesel, aviation turbine fuel and other motor spirit.

Sub-sections 102 (3) and 103 (4) focussed on penalties for the breach of rules and laying of the rules framed under the vat regulations in Parliament respectively, he said. Mukherjee also said amendments were being made as regulations were framed in the absence of the empowered committee's recommendations.
Back to News Review index page