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Today's Hot Stories - April 27, 2010

10 Headlines for Today

(1) Mayawati support UPA government over the cut motion expected to be moved in Lok Sabha.
(2) PM rules out Opposition demand for JPC probe on IPL and phone-tapping issues
(3) US asks Nepal to meet the May deadline for new constitution
(4) Maruti Suzuki posted a 105% growth in net profit in 2009-10
(5) Kingfisher commences two new flights between UAE, India
(6) US witness 57 bank failures this the year 2010 and 16 go belly up in April 2010
(7) Chess : Viswanathan Anand beat Topalov and level the scores in world chess championship
(8) Indian cricket board vice-president Chirayu Amin appoints as a interim chairman of IPL
(9) Manchester United and England striker Wayne Rooney won the PFA player of the year award
(10) India, Russia set up a USD 600 million Joint Venture to produce a transport aircraft

5 Stories for Today

(1) BJP brings breach of privilege motion against PM
(2) US extradites former Panama leader Manuel Noriega to France
(3) Godrej Consumer Product Ltd. has reported a 56% increase in its con. net profit
(4) Euro slips on Greece aid uncertainty
(5) Stimulus rollback is in best interest of economy: RBI

(1) BJP brings breach of privilege motion against PM

50 BJP MPs on Tuesday tabled a breach of privilege notice in Lok Sabha against Prime Minister Manmohan Singh for announcing outside Parliament his decision to reject setting up of a joint parliamentary committee on the issue of alleged phone tapping.

The MPs submitted the petition to Lok Sabha Secretary General P D T Achary. Their action comes close on the heels of Leader of the Opposition Sushma Swaraj objecting to the Prime Minister's announcement on the issue. "This is disrespect to the House. The Prime Minister should give a statement in the House on the issue," she said in Lok Sabha.

She insisted this was a serious matter as phones of even cabinet ministers were allegedly tapped. BJP has also demanded a JPC into the IPL controversy.

Opposition uproar over rising prices of essential commodities paralysed the proceedings in Parliament on Tuesday, with the Rajya Sabha adjourning for the day at noon and the Lok Sabha witnessing two adjournments.

The 'Bharat Bandh' called by the 13-party grouping, including the Left, on the issue of price rise cast its shadow in both the Houses with Lalu Prasad and Mulayam Singh Yadav leading the RJD and SP members into the well of Lok Sabha.

In the Rajya Sabha, they were joined by members of the Left and AIADMK, while the BJP stood up in support.

BSP, which announced its support to the government on the opposition-sponsored cut motions to the Demands for Grants, did not join the protests in both Houses.

Food prices have remained high with the index of these items hovering over 17 per cent. Even the general inflation, based on the wholesale price index, is almost touching the double-digit figure.

After the House re-assembled, SP and RJD members trooped into the well and shouted slogans like an ineffective government has to be changed this is just the beginning, more struggles lie ahead.

Rajya Sabha, which witnessed uproar rights from the word go, was adjourned during the Question Hour minutes after it met. Similar scenes were witnessed when the House re-assembled, leading to its adjournment for the day.

(2) US extradites former Panama leader Manuel Noriega to France

The United States extradited former Panamanian strongman Manuel Noriega to France on Monday to face money-laundering charges after years of legal wrangling.

Noriega was placed on board an Air France jet, escorted by French prison officials, shortly after US Secretary of State Hillary Clinton signed an extradition order in Washington, officials said.

The flight ended a long legal battle by Noriega, 74, to stave off extradition to France where he faces charges of money-laundering after spending two decades in US custody following his 1989 overthrow in a US invasion.

But even before Noriega had arrived in France, the legal wrangling resumed with Panama saying it would continue to press for his extradition there and Noriega's French lawyer vowing to challenge the jurisdiction of French courts.

Noriega's lawyer, Frank Rubino, complained in Miami that he had not been informed of the action.

"Neither the State Department or the Justice Department has the courtesy to call me and tell me that the order was signed or if general Noriega has been taking away," he told AFP.

A State Department spokesman announced the extradition after US television networks showed video of what they said was Noriega being led from a van into the Miami International Airport.

"Now that all judicial challenges to Noriega's extradition have been resolved, the secretary of state issued a surrender warrant for his extradition to France," said Mark Toner, a State Department spokesman.

In Paris, a spokesman for the French Justice ministry said the extradition was under way.

"France had been notified of this extradition two weeks ago," said spokesman Guillaume Didier, in confirming that Clinton had signed the extradition order.

Officials from France's penitentiary administration took custody of Noriega in Miami, sources in Paris said.

The US Supreme Court threw out a bid in March by Noriega to halt his extradition to France, closing the last legal avenue for the former military strongman to escape French justice.

France sentenced him in absentia in 1999 to ten years in prison but now wants to try him on money-laundering charges.

In Paris, a lawyer for Noriega said he would challenge the French court's jurisdiction over Noriega, on grounds that he enjoys immunity as a former head of state and that the statute of limitations had run out on the charges against the former general.

Meanwhile, Panama's Foreign Minister Juan Carlos Varela said his government respected the US decision. But he said "that does not mean Panama won't insist on pursuing diplomatic and legal channels to return Mr Noriega to his country to face the sentences imposed by Panamanian courts."

Noriega has three convictions for human rights violations in Panama, however, each carrying a 20-year prison sentence.

Once a prized CIA asset, Noriega rose to power in Panama as a military intelligence chief close to General Omar Torrijos, a left-leaning military strongman. After Torrijos' death in a mysterious 1981 plane crash, Noriega consolidated his power, ultimately becoming the head of the military and the country's most feared man.

By then his close relations with the United States had soured amid reports he had become deeply involved in drug trafficking, and suspicions he was two-timing the CIA with the Cubans.

Escalating internal repression sent tensions soaring, culminating in the 1989 US invasion dubbed Operation Just Cause, which ended in Noriega's capture and removal to the United States as a prisoner of war.

He later was tried in Florida on charges of drug trafficking and money laundering and served a 17-year prison sentence, which he completed in 2007. Since then, he had remained in US custody while fighting extradition requests by France.

(3) Godrej Consumer Product Ltd. has reported a 56% increase in its con. Net profit

Godrej Consumer Product (GCPL) has reported a 56% increase in its consolidated net profit at Rs 92 crore in the fourth quarter ended March 31, 2010, as compared to Rs 59 crore in the same period last year.

Sales revenue increased by 48% to Rs 509 crore in the quarter, up from Rs 344 crore during the year-ago period.

For the year ended March 31, 2010, GCPL nearly doubled its net profit to Rs 340 crore on a 47% growth on revenues of Rs 2,041 crore. The board of directors have recommended a 125% dividend, which will result in a total outflow of Rs 45.1 crore, including the dividend distribution tax.

Adi Godrej, chairman, GCPL, said, "FY10 has been a transformational year for GCPL. We've significantly enhanced our domestic presence, especially in tier 2 and tier 3 towns. This has been accompanied by the launch of several new consumer-centric offerings, re-launch of some of our existing products with support from focused and innovative marketing and promotion strategies.

Though the results were not exactly comparable to the same quarter previous year due to the consolidation of Godrej Sara Lee business, they are much in line with market expectations. However, consolidated results don’t present the whole picture.

A look at the results of the company’s stand-alone business, which contributes around 80% of the total business, reveals a major disappointment. The company has reported a near-flat growth of 2% in stand-alone net sales on the back of poor volume growth in its mass category products like soaps and hair colour. This, despite the company significantly increasing its advertisement expenditure from 4% of the net sales — in the same period last year — to 10% now. Favorable raw material prices, however, helped the company register a 14% growth in its stand-alone earnings and improve its operating profit margins by 470 bps.

The steadily falling growth of mass category consumer products is bad news for the company — indicative of drop in consumer demand. The rising food inflation has started hurting consumer budget and consumption.

(4) Euro slips on Greece aid uncertainty

The euro slipped on Tuesday after Germany demanded painful new austerity measures from Greece in return for badly needed financial aid, with investors likely set to push high risk European sovereign bond yields up further.

Chinese stocks were down more than 2 per cent and the Shanghai composite dropped to a 6-month low, leading declines in the region on fears banks in China may be preparing for a round of heavy fundraising.

Major European stock markets slipped in early trade, with Greece's fiscal crisis, soft commodity prices and US bank reform seen weighing on sentiment.

Greece could become the first euro zone country to be bailed out because of its weak finances, having already asked the International Monetary Fund and European Union for 45 billion Euros to survive.

But investors have begun to wonder if that amount is enough to avert a Greek.

Default and if other countries with high debts and low growth could fall like dominoes, jeopardizing Europe's economic recovery and threatening financial markets.

For now, the situation is viewed as a European affair, with asset markets outside Europe largely unfazed by the intense selloff in not just Greek but Portuguese bonds overnight.

Many investors are still more focused on solid signs of global recovery, underlined by strong earnings reports and sales forecasts from heavy machinery maker Caterpillar Inc and appliance maker Whirlpool Corp overnight.

Indeed, German consumer sentiment will likely hit a six-month high based on brighter views on the economy and income.

(5) Stimulus rollback is in best interest of economy: RBI

Asserting that the withdrawal of stimulus is in the best interest of the economy in the current scenario of high inflation, the RBI said that it has started unwinding the emergency measures plugged in during the financial crisis.

"The details are not important, but what message you must get is that we have begun in earnest the process of reversing from the expansionary stance," Reserve Bank of India Governor Duvvuri Subbarao said in his address to the Peterson Institute for International Economics, a Washington-based think tank, on Monday.

"We started unwinding in October 2009. We terminated unconventional measures first; we raised SLR and brought it back to the pre-crisis level, we raised the CRR on the banks by 75 basis points by end of January and another 25 basispoints last week. We raised policy rates, once mid-March and again last week by a total of 50 basis points," said Subbarao.

On whether reversal of monetary stimulus was anti-growth, the he said: "In the near-term, perhaps it could be anti-growth. There is certainly a sacrifice ratio there, but even in the long-term and the medium-term, sustained inflation is inimical to growth. So we have got to get inflation under control," he said.

Over the past few days, Subbarao attended the annual Spring Meeting of the World Bank and the InternationalMonetary Fund, besides those of the Finance Ministers of G-20 and BRIC countries on the sidelines. Noting that getting into the expansionary stance was relatively simple, the RBI governor said the dilemma is how toCalibrate the withdrawal.

"The tolerance for error was relatively more. But as we exit over the crisis, I have realised that you got to be much more calibrated, because of the implications of what you do and if you get it wrong the implications can be quite big," he said.

Referring to the RBI outlook released last week, the growth for the year 2010-11 is projected to be eight per cent plus.

"WPI inflation, we believe would be about 5.5 per cent by end of March," he said.

Subbarao said the Indian banking system had no exposure to tainted assets or stressed institutions and the country's growth emanates from domestic demand and domestic investment as the exports are less than 15 per cent.

He said India was hit by the global economy crisis because it is now more closely integrated with the rest of the world and the financial integration is as deep as trade integration.

The RBI governor said growth in India is consolidating; industrial growth is getting broad based and investment intentions are strong.

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