Overseas acquisition norms liberalised
New Delhi: The government has raised the ceiling for automatic approval for overseas investment to $50 million from the existing $15 million. It has also allowed Indian companies in knowledge-based industries to acquire businesses abroad at an investment of up to 10 times their export earnings. They will be able to use this level of funds in addition to the existing norm of up to $100 million through ADR/GDR/stock swap.

The industries that will be eligible include information technology, entertainment software, pharmaceuticals and biotechnology. Some companies like Infosys and Wipro, with high export levels, could make acquisitions costing as much as $ 1.5 to 2 billion with the new guidelines.

Proposals for direct investment in a joint venture or wholly-owned subsidiary abroad will be subject to profits in the three preceding years, and the investments will also have to be in the company’s core area of activity, accounting for half the turnover.
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Food grain target of 212 million tonnes
New Delhi: The Union agriculture ministry has set a production target of 212 million tonnes for food grains for 2000-01. The target for rice is 90 million tonnes, that for wheat 74 million tones, coarse cereals 33 million tonnes, and pulses 15 million tonnes.

The food grains output for 1999-2000 is estimated at 199 million tonnes, against a target of 210 million tonnes, which included 86 million tonnes for rice, 74 million tonnes for wheat, 34.5 million tonnes for coarse cereals, and 15.5 million tonnes for pulses. While the rice output has exceeded the target, the other crops have fallen short of their targets.

For commercial crops, the targets for 2000-01 are 325 million tonnes for sugarcane, 14.5 million bales for cotton and 10 million bales for jute and mesta, 29 million tonnes for oilseeds.
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Indian, US firms sign $1.4-billion deals
New Delhi: On 23 March Indian and American companies signed 11 agreements valued at $1.4 billion in investment terms the information technology, power, environment, and tourism sectors. Indian power minister PR Kumaramangalam, information technology minister Pramod Mahajan, and US commerce secretary William M Daley attended the signing ceremony.

Four of the agreements are in IT, including the DSQ Software group’s pacts with IBM, Neuvis Inc, and BancAmerica, and Modicorp’s agreement with Infodream. In power,

Synergics Energy Development Inc signed up with the Power Finance Corporation for the Shrinagar Hydroelectric project in Uttar Pradesh, and Ogden Energy signed two agreements for projects in Tamil Nadu and Madhya Pradesh.

In the environment sector, Global Market Resources Inc signed an agreement with Healing Medicaids Private Ltd for the purchase of hydroclave medical waste system, Lightstream Technologies Inc signed a strategic alliance agreement for introduction of chemical free, high-powered pulsed ultraviolet light water disinfection techology with an Indian company, and Water Systems International signed an agreement with the Haryana State Industrial Developmen Corporation to make water purification units.

In tourism World Corporate Club Inc signed up with the Flex group of companies to evaluate the suitability of property for the construction of an international business club in New Delhi.
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Petroleum sector in for reform
New Delhi: A report called Hydrocarbon Vision 2025 has recommended that 100 per cent foreign direct investment be allowed in the petroleum refining sector, against the current 49 per cent. It has also asked for an upward revision of the ceiling on foreign investment in the marketing segment.

The report was prepared by a high level group presided over by the finance minister, petroleum minister, deputy chairman of the Planning Commission, minister for external affairs among others.

The group has recommended the phased removal of subsidies, and full operational autonomy to public sector companies in the sector to establish and maintain marketing networks while allowing new players through transparent and clear criteria. The group has also recommended greater operational flexibility to refineries in crude sourcing and for managing risk through hedging.

The report also wants the government to deregulate overseas exploration activities of Indian companies.
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Power sharing formula dropped
New Delhi: The government’s cabinet committee on economic affairs has decided to do away with the mandatory formula-based power distribution arrangement for new Central power projects. It will go for an arrangement that gives the Centre greater flexibility in sharing.

The earlier formula will remain as a guideline. The Centre will favour states that have have undertaken reforms in the power sector.
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Citicorp Finance acquires Nation Wide Finance
Mumbai: Citicorp Finance India has bought a 74 per cent stake in Nation Wide Finance for Rs 14.82 crore. Nation Wide offers consumer durable financing through a 70-strong dealer network in New Delhi, Chennai, Bangalore, Pune and Coimbatore. It now aims to expand its reach to 35 additional cities this year and 70 other locations afterwards.
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