Business & Economy

Protectionist Press Note 18 goes, JVs get simpler

What is India News Service, Thursday, 13 January 2005, 2100 hrs IST

The government on Wednesday scrapped Press Note 18, through which Indian businessmen have for years held foreign companies to ransom. Instead, Press Note 1, under which Indian firms must deal with their joint ventures (JVs) with foreign firms on their own steam, comes into force with immediate effect. 

The protective Press Note 18 will not be available for Indian partners who enter into JVs after Wednesday, Commerce and Industry Minister Kamal Nath said on Wednesday. He said the move was to quell misgivings that India was placing obstacles before foreign investments. 

Press Note 18 was a provision by which foreign companies entering into a JV with an Indian company needed to get a \91\91no objection\92\92 from their Indian partner before they set up another JV with a new partner or even a 100 per cent owned company in the country. The provision was misused by Indian promoters who armtwisted their foreign partners even if their own JVs were languishing or defunct. The provision was seen as a severe disincentive by foreign companies to align with Indian partners with majority stake in the JV and was an impediment to FDI inflow.

Reddy moots capping FII inflows: Dr Y.V. Reddy, Governor, Reserve Bank of India, called upon the Government to have an option to impose a ceiling on FII inflows or even taxing them. However, he later clarified that the RBI was not in favour of imposing such a ceiling now. 

'No plan to tax inflows': Union Finance Minister P. Chidambaram on Wednesday said that there was no proposal to tax foreign institutional inflows, setting at rest fears over such a possibility in the wake of the comments made by the Reserve Bank of India.

Nasscom seeks animation studio: The National Association of Software and Service Companies has suggested to the Central Government to set up a sophisticated animation studio with the latest equipment to give a fillip to the animation industry in the country. 

MS research launches India centre:  Microsoft Research, the basic research wing of Microsoft Corporation, inaugurated its India centre here on Wednesday. The centre will focus on sensor networks, social science and ethnographic studies with regard to information technology, rural computing paradigms, new platforms and devices, connectivity and digital geo-graphics.

Sensex still in correction mode; sheds 120 points: The bourses continued their trend of corrections for the third day this week. The day's trading, characterised by extreme intra-day volatility, ended with the indices closing at their lowest level since November 25, 2004.

Pharma industry warns of increase in prices: An increase in the price of medicines is around the corner, if the Government goes through with its recent notification on levying excise duty on maximum retail price (MRP), caution pharma industry officials. 

Tata launches Spacio Gold: Tata Motors today announced the launch of Spacio Gold, the premium version of its rural and semi-urban utility vehicle, Tata Spacio A1. Spacio Gold, while retaining its core appeal of three-litre DI engine, rugged built and high fuel efficiency, would offer enhanced looks and comfort to the up-market customer, the company said in a press note here. 

PTL profit soars 70 pc: Punjab Tractors today announced a 70 per cent growth in October-December 2004, third quarter profit before tax \96 Rs 32.3 crore against Rs 19 crore posted for the same period last year.

Sebi set to make demat easier for retail investors: Demat account opening charges and custody charges for retail investors will be abolished soon.

46 p.c. rise in oil imports in April-December: Even as the export growth rate virtually doubled to 23.42 per cent in the first nine months of 2004-05 from 12.72 per cent in the same period in 2003-04, the trade deficit during the corresponding period widened.

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