Global cos keen on outsourcing more R&D jobs to India: Survey
New Delhi: According to A T Kearney's FDI Confidence Index survey that researched executives from the world's largest companies, It appears that the Indian dominance over the outsourcing business is likely to continue.

The executives from these global firms have comprehensively voted in favour of off-shoring assignments to India over other emerging destinations such as Eastern Europe and China during the next three years.

Interestingly, the Indian offshoring pie is also slated to extend beyond the traditional IT and call-centre business to include newer areas.

The new areas include research and development (R&D), along with process off-shoring such as human resources, engineering and accounting functions.

Significantly, about 14 per cent of the global firms responding to A T Kearney said they plan to outsource the entire business process, including human resource and finance assignments. Around 10 per cent said they planned to outsource R&D and engineering functions to India.

Slightly more than 40 per cent of the CEOs indicated that they would be likely make such investments in these markets over the next three years.

Among the firms that are already off-shoring business functions, an overwhelming 51 per cent said the work was up to their expectation, while 9 per cent said it exceeded performance. Only 17 per cent said that their outsourcing experience was below expectation.
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Steel ministry opposes captive mining by steel producers
New Delhi: The ministry of mines has opposed the proposals of captive iron ore mining by steel manufacturers. The ministry says that this would lead to an element of subsidy through transfer pricing, and that the mining sector as such is deprived of its share of profits in the value chain. There is also a loss of revenue to the Government.

The ministry says that the difference between the cost of extraction and the market price of iron ore is borne by the iron ore mining industry, which is not easy to quantify over the life span of the project. As of now, the cost of extraction for captive mining for SAIL and Tata Steel is between Rs250 and Rs325 per tonne, while the market price (iron ore) is around Rs2,000 per tonne.

The second part is the loss borne by the Government and state and provincial governments also bear loss in the form of lost taxes that would have accrued to it in the form of sales tax and other duties like octroi etc.
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Centre may take Rs.6,000 crore tax hit
New Delhi: The Centre is likely to end the fiscal year with a shortfall of around Rs6,000 crore in direct tax collection due to lower payments by public sector companies and slower growth in income tax collection.

The oil marketing companies have been burdened with under-recoveries on the sale of petroleum products. The expectations of the revenue department, which was hoping for an increase of at least 30 per cent in tax payments by ONGC, factoring in higher prices of crude oil have received a set back as the PSU, which is the country's largest tax payer, however, took a hit when a Bombay High platform was devastated by a fire earlier this year.

Non-oil PSUs Bharat Sanchar Nigam and Mahanagar Telephone Nigam have also paid less in advance tax than they did last year, officials said.

While figures were not available, officials said the companies were allowed higher deductions under Section 80IA of the Income Tax Act. Besides, their bottom lines were also affected by a steep fall in tariffs.

State-owned banks, too, have followed suit because of lower treasury income from trading in government securities.
According to estimates for the period between April and December 20, 2005, the government's corporation tax collections went up 25.6 per cent to Rs56,540 crore, as against Rs45,000 crore during the corresponding period last year.
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Prasar Bharati to have a new financial structure
Hyderabad: Prasar Bharati will soon have a new and more viable financial structure,which according to its chief executive officer, K. S. Sarma, is expected to be finalised in three months.

Keeping in mind the growing popularity of FM channels, the corporation had decided to set up 100 more FM stations by establishing a similar number of transmitters in the next two years. The target is to extend the FM coverage to 50 per cent of the population from the present 30 per cent. It currently has 150 FM transmitters and around 20 stations.

Prasar Bharati is estimated to have assets worth Rs4,258 crore. The corporation, which recorded revenues of Rs825 crore last year, is confident of reaching the Rs1,000-crore mark this fiscal. On the DTH (Direct-To-Home) expansion, he said that the number of installations would cross the 50-lakh mark this year. "By May 1, the number of television channels on offer would go up to 50 from 33 and radio stations to 22 from 12," he said.
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Centre may dilute stake in miniratnas
New Delhi: The government is once again considering diluting its equity stake in miniratnas. A Cabinet note is being prepared to disinvest 15 per cent of the government's equity stake in Housing & Urban Development Corporation (Hudco) and 10 per cent in Neyveli Lignite Corporation (NLC). Hindustan Zinc (HZL) is next on the line.

A move to offload a part of the government's equity in HZL is also being considered, but no proposal has been finalised yet.

The government may go through the initial public offering (IPO) route for divesting its stake in the organisations. Hudco is a miniratna and a completely government owned company and posted a net profit of Rs265.6 crore in the nine-month period ended December 31, '04-05.

The government holds 93.56 per cent in NLC and public holding is limited to 1.08 per cent. The balance of 3.23 per cent owned by Fis. MFs hold 0.85 pert cent and FIIs hold 0.86 per cent. With a turnover of over Rs3,000 crore, the company recorded a net profit of Rs1,215 crore in '04-05. The integrated mining and power generation company was awarded miniratna status in '04.

The government is yet to take a final decision on HZL.
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Seamen's PF: NUSI threatens strike
Mumbai: The Indian National Shipowners Association has been informed by the National Union of Seafarers of India (NUSI) of its intention to go for an agitation, related to the recouping of the Rs93-crore loss suffered by Seamen's Provident Fund (SPF) in securities trading in 2002. The NUSI wants an assurance from the Director-General of Shipping that the losses will be recouped.

INSA officials are intrigued that NUSI's call for an indefinite strike comes barely ten days after the Bombay High Court directed the Union Government to come out with a decision on the SPF losses.

The NUSI is also a party to the case, which is scheduled for hearing on January 16.

In 2002, the SPF had lost Rs 92.74 crore in securities transactions, allegedly entered in violation of the government guidelines. The government had taken some actions then - sacked the SPF Commissioner, ordered a CBI probe, reconstituted the SPF board and tightened investment norms.
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CCEA clears cost estimate for Tehri transmission system
New Delhi: The Cabinet Committee on Economic Affairs has approved the revised cost estimate of transmission system associated with 1,000 MW Tehri Hydro Electric Project.

The project would entail a cost Rs913.16 crore, including interest during construction of Rs269.16 crore, and would be commissioned in March 2006, an official spokesperson said.

The transmission project would facilitate evacuation of power from Tehri Hydro Electric Project and further dispersal to various beneficiaries of Northern region.

The transmission system consists of two Tehri-Meerut single circuit lines of 186 km and 184 km, a Meerut-Mandola line of 60 km and Meerut-Muzaffarnagar line of 38 km.
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