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Today's Hot Stories - April 24, 2010

10 Headlines for Today

(1) Bomb attack on prisoners' bus injures 10 in Pakistan
(2) Singapore Minister for deepening ties with India
(3) MCI president remanded to five-day police custody
(4) RIL Q4 net profit surges 30%
(5) Toyota to recall 100,000 Corollas in Brazil: Consumer group
(6) Goldman Sachs director Gupta gave tip on Buffett deal: Report
(7) Governing Council meeting as per schedule: BCCI sources
(8) Age is just a number for Sachin: Harbhajan
(9) No draws, Topalov tells Anand ahead of WCC
(10) Centre to reconsider assets case against Mayawati

5 Stories for Today

(1) Opposition demands JPC probe into IPL irregularities
(2) 58 killed, scores injured as blasts rock Iraq
(3) Wipro profit rises to Rs. 4,593 crore
(4) G20 hails global rebound, urges 'credible' exit strategies
(5) Greece seeks activation of rescue package

(1) Opposition demands JPC probe into IPL irregularities

Tremors from the rapidly imploding Indian Premier League behemoth echoed through Parliament on Friday, with a united Opposition stalling both Houses demanding a Joint Parliamentary Committee (JPC) probe covering the full range of irregularities in the control and management of the money-spinning T-20 cricket tournament.

In a related development, embattled IPL Commissioner Lalit Modi facing the onslaught of income tax and Enforcement Directorate investigations and the threat of ouster, sought five days' time from the Board of Control for Cricket in India (BCCI) to present his case before the cricketing body.

A determined Opposition both in the Lok Sabha and the Rajya Sabha kept up the chant for a JPC into the T-20 mega scam. The uproar in the Lok Sabha brought Finance Minister Pranab Mukherhjee to his feet. Mr. Mukherjee promised that he would convey the sentiments of the House to Prime Minister Manmohan Singh.

Outside, the various enforcement wings of the government agencies cast their nets wider even as allegations of betting and match fixing during the second edition of IPL in South Africa surfaced, threatening the carefully constructed brand image of the game as well potentially damaging the reputations of several players charged with benefiting from the “slush money.''

The tax authorities also slapped notices on Kolkata Knight Riders Sports Private Limited and Gameplan Sports seeking details of their dealings in the IPL, and directing them to appear before the authorities on April 28 in connection with the searches conducted at the premises of the two companies.

“We have issued notices to both Knight Rider Sports and Gameplan,'' Director-General of I-T investigation (East) Vinod Khurana stated.

The tax authorities in Mumbai are probing the funding and shareholding pattern of KKR Sports as the company was based in Mumbai.

On the other hand, IPL CEO Sundar Raman appeared before the Income Tax authorities in Mumbai and submitted a large number of documents pertaining to IPL deals, franchisee details, sponsors, event managers and their respective roles.

Director-General (Investigations) B.P. Gaur submitted a “source report'' to the Finance Ministry even as Mr. Mukerhjee held intense consultations with the top officials of the investigating agencies to gauge the depth of the scam that could have cross-border implications.

BCCI vice-president Rajiv Shukla also met Mr. Mukherjee and apprised him of the developments in the Board as well as those concerning the IPL.

The income tax sleuths are also probing the alleged links of Kings XI Punjab with the name of one Delhi-based individual cropping up as a possible proxy. The anti-corruption unit of the International Cricket Council cautioned the BCCI last year that bookies had entered the game which was not in its best interest. However, both the BCCI and IPL chose to overlook the ICC unit's warnings.

(2) 58 killed, scores injured as blasts rock Iraq

A series of bomb attacks mainly targeting Shia worshippers killed 58 people on Friday, including 25 near the main Baghdad office of an anti-U.S. Shia cleric.

The violence demonstrated militants remain a potent force days after Iraqi authorities announced the killing of the top two Al-Qaeda in Iraq leaders in what they described as a major blow. Extremists are also seeking to exploit political deadlock after the inconclusive March 7 parliamentary election and ignite sectarian warfare as U.S. forces prepare to go home.

The biggest of Friday's bombings took place just a few hundred yards from the compound of cleric Moqtada al-Sadr in Baghdad's vast slum of Sadr City as worshippers gathered for Friday prayers.

Two car bombs and a roadside bomb exploded around 1:30 p.m., killing 25 people and wounding an estimated 150.

The blasts left blood streaming down muddy streets. Men carried victims away using bed sheets as makeshift stretchers and loaded them into the backs of trucks and rushed them to the hospital. One man fled carrying a young girl whose dress was stained with blood.

Many who gathered at the scene pelted Iraqi security officials with stones when they arrived in the area, frustrated with their apparent inability to secure the city. Security officials fired in the air to disperse the crowd.

Bombings elsewhere in Iraq most of them targeting Shia worshippers killed 33 other people in one of the deadliest days the country has seen in weeks.

(3) Wipro profit rises to Rs. 4,593 crore

Software services major Wipro on Friday reported 6 per cent year-on-year growth in revenues at Rs. 27,124 crore. Buoyed by a 240-basis point increase in operating margins, the company made a net profit of Rs.4,593 crore in 2009-10, an increase of 18 per cent over 2008-09.

Revenues from IT services, which contribute about three-quarters of the total revenues and 92 per cent of the operating income, were higher by 6 per cent (year-on-year) at Rs.20,249 crore. In dollar terms, revenues from IT services increased by a modest 3.5 per cent sequential growth at $1.166 billion, reflecting the appreciation of the rupee during the year.

The company has announced the issue of two bonus shares for every three shares held. The company board has also recommended a final dividend of Rs.6 per share on the face value Rs. 2 each.

Improving environment

Announcing the results, Wipro Chairman Azim Premji said the company's “billable headcount in the last quarter of 2009-10 was among the strongest in several quarters. The international environment is stabilising and companies that were sitting on the fence are now taking decisions about their IT budgets.”

Delivering the revenue guidance for the first quarter of 2010-11, Mr. Premji said revenues from IT services are likely to be between $1.190 billion and $1.215 billion.

Mr. Premji said the company's operating margins improved by 60 basis points in the fourth quarter. Wipro planned to increase the share of locals working in overseas delivery centres from the current level of 39 per cent to 50 per cent. This would help in reducing the company's demand for H1-B visas and the associated expenses, he explained.

The company had done well despite the appreciation of the rupee, the increase in wage costs and adverse impact of cross currency movements, he said.

Chief Financial Officer Suresh Senapathy said the appreciation of the rupee “will be a major concern for Wipro during the year. It has manifested on the results for 2009-10. Exporters expect the Reserve Bank of India to deal with capital inflows, which are having an adverse impact on their earnings.” The company had foreign exchange cover (hedging) to the extent of earnings amounting to $1.17 billion, he said.

Joint CEO and Board member Suresh Vaswani said government projects, particularly the Unique Identification project, were an “important focus area” for Wipro. “We are involved in most large projects of the government and public sector companies,” he added.

The company reported an attrition rate of 17 per cent in 2009-10. Mr. Premji admitted that the attrition in Wipro was higher than the 12 per cent attrition rate among industry peers.

(4) G20 hails global rebound, urges 'credible' exit strategies

G20 finance ministers hailed Friday a better-than-expected economic recovery and said it was time for plans to unwind measures to tackle the waning global crisis.

The ministers remained split however over support of a global bank tax, Canadian Finance Minister Jim Flaherty acknowledged after a meeting of counterparts from 20 leading developed and developing countries in Washington.

"The global recovery has progressed better than previously anticipated largely due to the G20's unprecedented and concerted policy effort," a statement released after the meeting said.

"We should all elaborate credible exit strategies from extraordinary macroeconomic and financial support measures that are tailored to individual country circumstances."

When asked at a subsequent about issues on which ministers differed, Flaherty said: "There was not agreement on a global bank tax. Some countries are in favor of that, some countries quite clearly are not."

The G20 ministers asked the International Monetary Fund, which hosted the meeting, to draft additional proposals for bank taxes to help stem excessive risk taking and pay for bank bail-outs that were needed to prevent a financial sector meltdown.

IMF experts are to consider "how the financial sector could make a fair and substantial contribution towards paying for any burdens associated with government interventions to repair the banking system," the statement said.

The IMF was set to propose two taxes, one to reimburse governments for the cost of bailing out banks hit by the crisis, and another to dissuade banks from taking excessive risks in the future.

US Treasury Secretary Tim Geithner said "It's a basic sense of fairness that we adopt that basic framework."

But G20 ministers face tough discussions, since opposition to the tax was expressed by countries including Brazil and Canada.

Governments worldwide spent trillions of dollars to prop up financial markets after risky bank investments tanked, driving countries like Greece deep into debt.

Flaherty said the meeting had discussed the Greek deficit and debt crisis, saying: "It is of course a source of concern to us."

"It's essential that some steps be taken, that the Greek government work with the IMF and with the European Commission of course to identify a credible multi-year economic and fiscal program" to curb a soaring public deficit and debt, the Canadian minister added.

The Greek fiscal crisis has fueled chronic instability on financial markets, undermining eurozone stability and the strength of the global economic recovery.

Ending weeks of speculation, Athens asked earlier Friday for a 45-billion-euro (60-billion-dollar) bailout from the European Union and IMF to help the Greek government pay its bills.

Eurozone members Portugal, Italy, Ireland and Spain are also at risk of having to pay higher rates for credit on private capital markets, and concern has been voiced regarding Britain and the United States as well.

In a bid to ease tensions, IMF chief Dominique Strauss-Kahn said the fund would move "expeditiously" to roll out the Greek rescue package.

The European Union's economic and monetary affairs chief Olli Rehn told a press briefing that EU countries were ready to "swiftly" activate a mechanism set up to provide their share of funds to Greece.

Finally, the ministers discussed how to rebalance the global economy, a task made more complex by growing differences between the recovery in emerging and advanced economies.

Brazil, China and India have emerged from the downturn in much better shape than European, US and Japanese counterparts.

The IMF has predicted that advanced economies will grow just over three percent this year, while emerging and developing economies should expand by more than six percent.

(5) Greece seeks activation of rescue package

Greek Prime Minister George Papandreou called for the activation of a joint euro-zone International Monetary Fund financial rescue to pull his country out of a major debt crisis.

Saying financial market pressure threatened to derail Greece economy with high borrowing costs, Mr. Papandreou said he had asked Finance Minister George Papaconstantinou to make a formal request for the plans activation.

The moment has come, Mr. Papandreou said, speaking from the remote Aegean island of Kastelorizo.

Mr. Papaconstantinou sent a letter to the euro-group, European Commission and the European Central Bank on Friday formally asking for the activation of the plan.

Greece is asking for the activation of the support mechanism, said the letter released by the Finance Ministry.

Mr. Papandreou, speaking from the remote Aegean island of Kastelorizo, said it was a national and pressing necessity for us to formally ask our partners for the activation of the support mechanism, which we jointly created in the European Union.

Mr. Papandreou said the markets had not responded positively to Greece austerity measures that were designed to pull the country disastrous finances into line. He blamed the previous conservative government for mismanaging the country finances and fudging statistics in its reports to the EU.

We inherited a ship that was ready to sink. A country bereft of prestige and credibility, which had even lost the respect of its friends and partners said Mr. Papandreou, who came to power in October elections.

The plan aims to cover Greece immediate borrowing needs so it can continue servicing its debt and avoid default. The bailout would have to be reviewed by the European Union executive and the European Central Bank, and needs approval by all 15 of the other governments that use the euro.

Greece and the EU had hoped that the announcement last month of a standby support plan would reassure markets that Greece was not going to default on its massive debt and make them see reason, so we could continue financing our country with lower interest rates, the prime minister noted.

However, he said, markets did not respond. Either because they did not believe in the will of the EU or because some decided to continue speculating. And today, the situation in the markets threatens to deconstruct, not only the sacrifices of the Greek people, but also the smooth course of the economy itself.

The rescue package would provide Greece with loans from other euro-zone countries to the tune of euro30 billion at interest rates of about 5 percent, and about euro10 billion from the IMF.

Until now, Greece had insisted it preferred to tap bond markets for its borrowing requirements and avoid calling for a rescue.

But on Thursday, borrowing costs spiralled to alarming and unsustainable levels, pushing interest rates for Greek 10 year bonds to nearly 9 percent. Investors demanded high rates because they viewed Greece as a risky borrower who might not pay.

The spike came after after Moody credit agency downgraded the countrys sovereign rating and the European Union statistics agency Eurostat revised Greece budget deficit in 2009 to 13.6 percent of gross domestic product from 12.9 percent, and said it could be further revised by up to 0.5 percentage points.

The level is more than four times the EU limit set for the 16 countries that use the euro, which has been badly hit by the Greek financial crisis. Athens insisted its target of reducing its deficit by at least 4 percentage points in 2010 remained unchanged.

The interest rate gap, or spread, between Greek 10 year bonds and German ones - considered a benchmark of stability - began to narrow rapidly on the announcement that Athens was asking for the aid, falling to 5.11 percentage points from Thursday alarming highs of 5.86 percentage points.




           
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