Daily Economic News - 8 May 2014
Vodafone serves arbitration notice in tax dispute, govt to drop peace offer
In its notice on April 17, Vodafone said it will go ahead with international arbitration, preferably in London, to resolve the long-pending tax dispute concerning its 2007 acquisition of Hutchison Whampoa's stake in Hutchison Essar. It has given two months time for a response, which may mean the new government will have to take a call on the demand for arbitration. Vodafone International Holdings BV has commenced international investment arbitration against the Indian government under the bilateral investment treaty between India and the Netherlands. Vodafone is locked in twin tax disputes with the government. One pertains to its 2007 acquisition and the other is the transfer-pricing case involving Vodafone India Services. While the basic tax demand is Rs 7,990 crore, the total outstanding is Rs 20,000 crore after including penalty.
The Supreme Court had ruled in Vodafone's favour in 2012, saying it was not liable to pay any tax over the acquisition of assets in India from Hong Kong-based Hutchison.
(Source: The Financial Express)
Wheat procurement may fall to six-year low
It has been estimated that the total wheat procurement this year will be 24-25 mt. Earlier, it was projected the procurement would stand at 38.1 mt; this was scaled down to 31 mt at a meeting of food secretaries on March 17. Last year, wheat procurement stood at 25.04 mt. This year, procurement has been hit by crop damage and lower yields in Madhya Pradesh and aggressive buying by millers and private traders in Uttar Pradesh. this year saw significant hoarding by farmers. Expecting a surge in prices and anticipating an impact of the El Niño weather phenomenon on agricultural commodities in the coming months, they have diverted substantial quantities of wheat to private granaries.
Madhya Pradesh and Rajasthan are offering a bonus of Rs 150 a quintal to farmers for wheat procurement. After seeing a severe supply crunch in the second half of this season (October-March), millers are on a buying spree this year. Uttar Pradesh produces about 30 mt of wheat, the most in India, but contributes only 200,000-400,000 tonnes to the central pool.
(Source: Business Standard)
India has huge potential to attract FDI from Europe: Report
According to European Indian Chamber of Commerce report, European companies were the largest investors in India with total investments amounting to $198 billion during 2004-2013. During the same period, US firms put in $138 billion, while Japan pumped in $50.7 billion. Britain, Germany and France accounted for 64 percent of the total European investments in India. British companies pumped in $70 billion or about 35.5 percent of the overall EU investments in India during the 2004-13 period.
However, investors have been deterred by the poor investment climate in India and vexing tax issues
(Source: The Economic Times)
FedEx India poised for growth post integration of ALF, UFL
American courier giant FedEx Corp said it was poised for growth in India after successful integration of its acquired AFL Pvt. Ltd. (AFL) and Unifreight India Pvt. Ltd (UFL) businesses here. These companies were acquired in 2011, and it took more than three years to achieve full integration. FedEx Express India has expanded its service coverage to 19,000 postal codes, nearly five times from 4,000 postal codes prior to the acquisitions. It has doubled its ground transportation fleet to over 10,000 trucks and has increased its office and hub space capacity from 300,000 sq. ft. to one million sq. ft.
(Source; The Hindu)
Thaiindianet. Team
8 May 2014
