Extend STP benefits for 10 years, says Nasscom
Mumbai: A delegation from the National Association of Software and Service Companies, or Nasscom, met Union finance minister Yashwant Sinha and asked for a modification of four policies announced by him in his Budget speech on 29 February.

One of Nasscom’s concerns is the 1 April 2000 deadline for being in an export promotion zone or a software technology park. The association believes this is an avoidable entry barrier for new software companies, and wants the condition to be available for 10 years from now.

Nasscom has also suggested that the limit for overseas acquisitions be raised from its present level of $100 million to $1 billion. Another issue is the Nasscom demand for a roll-back on the 20 per cent taxation of venture capital funds when the profits are not distributed. The association believes that venture funds should get the same benefits as mutual funds, their dividends should be made tax-free, and should be treated as long term capital gains.

On employee stock options, Nasscom wants stock options to be taxed at the time of sale. To allay finance ministry concerns, it has suggested that the government should tax options on sale and allow gift only after the sale.
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35% peak duty protection will go for consumer goods in April
New Delhi: The government is likely to charge an import duty of 25 per cent duty on textiles and consumer product imports when it opens the economy to freer imports of these products from April. If the 10 per cent surcharge is added, the effective rate will be 27.5 per cent.

This opening up, which it will do under its agreement with the US, was expected to mean a peak duty protection of 35 per cent plus a 10 per cent surcharge. However, the peak rate may be available only to agricultural products.

So, expect more intensive competition in the consumer product industries.
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CKD car imports get Modvat credit
New Delhi: The Union finance ministry is reported to have decided to extend Modvat credit on the special excise duty component for completely knocked down kits of imported cars.

Motor vehicles, including passenger cars will attract a 16 per cent Central value added tax, or Cenvat, and a 24 per cent special excise duty.
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Inflation rate down
Mumbai: The rate of inflation in terms of the wholesale price index dropped to a 20-week low of 2.37 per cent in the week ended 12 February 2000 from 2.56 per cent in the previous week. The rate touched a 32-week high of 3.31 per cent in the week ended 22 January, and has declined since then, mainly due to the decline in the prices of various primary articles.
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Sinha sees difficulties with interest rate reduction
New Delhi: Union finance minister Yashwant Sinha is reported to have admitted that the government’s heavy borrowing programme for 2000-01 will make it difficult to reduce interest rates. The minister pointed out that the Reserve Bank of India had to decide on interest rates reductions, but said the government’s borrowing programme will come in the way.

In the meanwhile, former RBI governor S Venkitaramanan has expressed his opinion that the RBI is unlikely to cut its key bank rate immediately. He believes that the central bank may do this only when it issues its monetary policy statement in April.
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Bank of Maharashtra ties up with Exim Bank
Pune: The Bank of Maharashtra and the Export Import Bank of India have tied up for co-financing exports and export-oriented companies and to provide value-added services to promote the process of globalisation among small and medium-sized externally-oriented companies. The two banks have signed a memorandum of understanding for this purpose.
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Indian Overseas Bank’s gold scheme
Chennai: The Indian Overseas Bank has launched its gold deposit scheme, collecting 25 kg of gold from 15 clients on the opening day on 2 March. It is the third bank in the country to launch such a scheme. The others are the State Bank of India and Corporation Bank.

IOB has kept the minimum deposit under the scheme at 250 gm (gross weight). It is offering 3.25 per cent interest on a three-year deposit, 3.50 per cent on a four-year deposit and 3.75 per cent on a five-year deposit. The interest earned is tax-free and the deposited gold is free from wealth tax.
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SBI, HDFC tie up for credit info bureau
Mumbai: The State Bank of India and the Housing Development Finance Corporation have tied up to create India’s first credit information bureau. They have also roped in Dun and Bradstreet and Transunion, the world’s largest credit information providers, as equity partners who will provide technical support.
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Regulator against electricity sops
Mumbai: The Maharashtra Electricity Regulatory Commission, which was created in October 1999, has directed the state government and the Maharashtra State Electricity Board to desist from giving "any concessions to any group of consumers". The directive is significant in the context of state energy minister Padmasinh Patil’s recent decision to waive Rs 75 crore owed by powerloom owners in Bhiwandi in the state. The decision was opposed by MSEB chairman Ashok Basak.

Chief minister Vilasrao Deshmukh is reported to have announced his decision to go in appeal against the MERC’s order.
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Sanskrit gets five times more
New Delhi: The Union Budget 2000-01 proposals envisage the spending of Rs 30 crore on various schemes to promote Sanskrit education during the next fiscal year. This will be five times more than the funds allocated to all other, including modern Indian languages, put together.

The funding for such schemes, administered by the ministry of human resource development, has been mounting steadily over the years. Earlier more funds used to be allocated to modern Indian languages.
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23,804 cos registered in 10 months
New Delhi: During the period Apr 1999-Jan 2000, as many as 23,804 companies were registered in India, against 22,758 during the corresponding period of the previous fiscal year. in January 2000, the number of companies registered under the Companies Act, 1956, was 2,415 against 1,954 in January 1999, and 2,777 in December 1999.

On 31 January 2000, the total number of registered companies was 5,38,200.
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