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Today's Hot Stories - April 28, 2010

10 Headlines for Today

(1) Arrest of Indian diplomat for spying a serious issue: Krishna
(2) CBI arrests cop for Sohrabuddin Sheikh encounter
(3) US unlikely to openly criticise Sino-Pak nuke trade: Report
(4) Bharti Airtel Q4 net dips 8%; revenue crosses Rs 10k cr
(5) Food inflation to decline in coming months: Pranab Mukherjee
(6) Iconix is new owner of comic strip Peanuts
(7) Dhoni confident as India embark for World T20
(8) Bookies didn't take bets on Chennai win
(9) Bayern's hat-trick hero Olic shocked by Lyon win(10) Thai troops, protesters clash in Bangkok suburb

5 Stories for Today

(1) BJP withdraws support to Soren govt in Jharkhand
(2) Rapid progress' on Greek bailout talks: EU
(3) Govt committed to tax reforms: Pranab
(4) Infrastructure sector grows 7.2% in March
(5) Coca-Cola to set up 3 new plants in China

(1) BJP withdraws support to Soren govt in Jharkhand

Calling Jharkhand Chief Minister Shibu Soren's action of voting with the government in Lok Sabha an "act of betrayal", BJP today withdrew its support to the JMM government in Jharkhand.

The decision was taken in the party’s parliamentary board meeting which had been convened to discuss the future of ties with JMM in Jharkhand.

Senior party leaders had earlier said that BJP had taken very serious note of Soren's action and is not buying the explanation given by Soren's son Hemant that it has happened by mistake even as the Chief Minister wondered "what difference will it (his vote) make".

"The voting in favour of UPA by Soren is an act of betrayal. The manner in which he has voted is a betrayal of coalition dharma. We have taken it very seriously. Senior party leaders will take a call on it," senior BJP leader Prakash Javdekar said.

Another party leader Venkaiah Naidu had echoed similar views saying "it's a clear betrayal".

"You can't be heading a government with the support of BJP, be in opposition and at the same time, support the ruling party at the Centre. It is not acceptable. On what to do the party will meet and discuss. It is a serious issue," he said.

Naidu also refused to buy the explanation given by Hemant Soren on the issue that his father voted for UPA in a mistake. Senior party leader from Jharkhand Yashwant Sinha said, "He (Soren) is there (on the Chief Minister's chair) in Jharkhand with our support. Therefore, the least that was expected of him that he would not go to this stage. He could have stayed neutral."

Soren had a meeting with BJP president Nitin Gadkari last night where his decision not to vote with the BJP came up for discussion.

(2) 'Rapid progress' on Greek bailout talks: EU

Talks on putting in place emergency aid for debt-laden Greece are making "rapid progress," the European Commission said Wednesday, with the work set to be finalised "in the coming days."

"The European Commission is making solid and rapid progress with the European Central bank, the International Monetary Fund and the Greek government," in talks with Athens aimed at activating a programme of loans.

EU leaders have already agreed in principle, with the IMF, to offer Athens 45 billion euros (60 billion dollars) for the first year of a three-year programme of help.

The procedure requires the European Commission and the European Central Bank to decide that Greece's request for help is justified, after which the eurozone leaders will have to give the formal green light for the loans to begin.

Eurozone leaders are set to hold an extraordinary summit in Brussels on May 10.

Altafaj repeatedly stressed that restructuring Greece's debt -- which means losses for holders of its bonds -- was not an option.

However the German government on Wednesday categorically excluded such an option.

(3) Govt committed to tax reforms: Pranab

The government today reiterated its commitment to carry out reforms on direct and indirect taxes, saying a draft legislation on DTC is likely to be tabled in Parliament in the monsoon session and talks with the states are on regarding the design of the proposed GST.

"After a quick round of consultations with some of the major stakeholders, we should be able to submit the draft legislation to Parliament in the monsoon session," finance minister Pranab Mukherjee told the Lok Sabha, while initiating the debate on the Finance Bill.

The government has proposed to replace the Income Tax Act of 1961 with a direct taxes code, which would simplify the legislation. The code is also expected to minimise tax exemptions, but widen tax slabs.

The first draft discussion paper proposed to levy tax at the rate of 10 per cent on annual income between Rs 1.6 lakh and Rs 10 lakh, against the present upper range of Rs 5 lakh, while 29 per cent on income between Rs 10 lakh and Rs 25 lakh, against Rs 5-8 lakh currently. Similarly, the highest income tax slab of 30 per cent was proposed to be imposed on annual income above Rs 25 lakh against over Rs 8 lakh at present.

But there were many complaints against the first draft against its proposal to tax long-term savings and retirement money at the time of withdrawal and the silence on tax rebates on housing loans.

Besides, the draft DTC proposed to impose minimum alternate tax (MAT) on gross assets of companies, instead of gross profits, a suggestion which did not go down well with the industry. MAT is a levy imposed on profit-making companies which do not fall under the tax net due to various exemptions.

The finance minister had assured the the MPs earlier that he would try to address the grievances against some provisions of the first draft.

As regards indirect tax reform in the form of goods and services tax (GST), the finance minister said the Centre is engaged with the states in finalising the design of new tax system, which will replace VAT at state level and excise and service taxes at the national level, besides a host of local levies.

Earlier, Mukherjee had expressed his intention of introducing GST from next fiscal, a delay of one year from the scheduled date of implementation. He said the Centre is willing to provide compensation to the states for initial years in case they lose revenue after switching over to GST, provided there is agreement in various aspects of GST.

"The design and modalities of providing this compensation would be worked out in discussion with the states and the empowered committee," the finance minister said.

(4) Infrastructure sector grows 7.2% in March

The infrastructure sector continues to grow at a healthy rate. In March, the six key sectors crude oil, petroleum refinery, coal, electricity, cement and finished steel posted an annual growth of 7.2%, boosting prospects of a robust overall industrial growth in the month. The six sectors had grown by 3.3% in March 2009.

These six industries, which have a combined weightage of 26.7% in the overall industrial production index, showed a marked improvement in March — as against 4.7% in February 2010. For 2009-10, the infrastructure sector registered a growth of 5.5% against 3% in the same period last year, an official statement said.

Finished steel with a 9.2% expansion led the recovery, reversing a negative 1.8% growth in March last year. Coal, electricity and cement grew by 7.8% each against 5.3%, 6.3% and 10.1%, respectively in 2008-09. Crude oil production went up by 3.5% from a negative 2.3% the same month previous fiscal. But petroleum refinery products showed a dismal performance with 0.4% contraction in March 2010 over a positive 3.3% a year ago.

"The growth of 7.2% growth means overall industrial growth will stay healthy in March," Crisil principal economist DK Joshi said. The overall industrial output maintained a high growth rate of over 15% for the third month in a row in February. "This is a broadbase is a good performance. I would expect it would have good reflection on the IIP figure for March," former chairman of Prime Minister's Economic Advisory Council, Suresh Tendulkar said.

Crude oil production registered a growth of 0.5% during April-March 2009-10 compared to contraction of 1.8% during the same period of 2008-09. Petroleum refinery production contracted 0.4% compared to 3%, the statement said.

(5) Coca-Cola to set up 3 new plants in China

US soft-drink giant Coca-Cola will set up three new plants in China this year with an investment of $2 billion, the company said.

Two bottling plants will be opened in South China's Guangdong Province and Hohhot, in north China's Inner Mongolia Autonomous Region, said Muhtar Kent, chairman and chief executive officer of Coca-Cola.

"We will also construct a new facility, which will be one of the largest plants we have in this country, in central China's Henan Province this year," said Kent.

The 42-billion investment package is for the period 2008 to 2011. Last year, Coca-Cola inaugurated three new factories, in northwest China's Xinjiang Uygur Autonomous Region, east China's Jiangxi Province and central China's Hubei Province.

"We will also increase the capacity of some existing factories here, equipping them with new production lines as well as new trucks, warehouses and coolers," Kent was quoted as saying by Xinhua.

Besides production, Kent said that his company will make significant investment in marketing, distribution, logistics and brand innovation.

With a business roadmap to 2020, Kent said China's actual non-alcoholic ready-to-drink market is probably the second largest in the world today.

"I think China will overtake the US to become the world's largest non-alcoholic ready-to-drink market in a fairly short period of time," Kent said. "It's not a question of if, but only a question of when."

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