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Capital Notes

TVS to invest Rs 110 crore in BMW

THE southern star TVS Motor Co is to invest euro 20 million (Rs 110 crore) for a tie-up with German automaker BMW AG’s motor cycle division for sourcing high-end technology for making upmarket motorcycles in India.

Under the agreement, TVS will invest in making vehicles under the 500 CC categories where the  development costs would be borne by BMW. “We have decided to marry our capabilities for manufacturing products for mass consumption while leveraging the strengths of our partner BMW,” said Venu Srinivasan, MD of TVS Motor,

The vehicles are to be made in two categories – one for TVS and one for BMW. They will be sold through their individual dealership networks. They will also be exported separately. 2015 has been set as the launch date for the products being jointly manufactured by TVS Motor and BMW. It will be a good marriage of the frugal engineering expertise of TVS with the tech- strength of the German company.

India to bail  out Iran ship industry

THE Shipping Corporation of India (SCI) is to take possession of about six ships owned by the Irano Hindi Shipping Company to help Iran escape sanctions from the western world. The joint venture was wound up some time ago.

The JV between Iran and India’s liners was wound up following a proposal by the Iranian government after western sanctions against it made it difficult for the venture to secure any new business. All the six ships that SCI gets from Iran will be registered in India and will fly the Indian national flag.

While Iran had a 51 per cent controlling stake in the JV, India had a 49 per cent stake and the former had been desirous of breaking the partnership as early as July last year. Shipping Ministry sources claimed that the net worth of the company was about US $ 75 million against outstanding loans of US $ 80 million.

Since no banking institution was willing to stick its neck out for saving the deal, SCI has taken the risk of underwriting the loans from its own funds while getting the vessels as re-compensation from Iran out of the joint venture.

Air India to resume flying Dreamliner

AIR INDIA, which grounded the entire fleet of its prestigious 787 Dreamliner aircraft acquired from Boeing, USA for a suspected battery component problem detected worldwide by many airlines, will resume flying the new airliners by May this year.

This follows Boeing’s clearance of an air worthiness certificate for a new battery system by the US regulator Federal Aviation Administration (FAA) on 5 April. In January this year, Air India had grounded all its six Dreamliner’s following an order by the country’s civil aviation regulator, Directorate General of Civil Aviation (DGCA).

The plane was first pulled out of flight in Japan in January middle when one of their aircraft made an emergency landing following a battery error signalled by one of the instrumentation panels.

New US rule to hit Indian IT companies

WITH US senators pushing for new immigration norms, India’s top IT companies doing major business in USA such as TCS and Infosys might feel the blow. The new law may lead to both IT companies pulling out their IT professionals from the shores of the US working on H1B visas/work permits. This visa has served as the company’s major business models in the US which might now stand disrupted.

NASSCOM, which represented India’s US $ 108 billion IT industry, feels the new immigration bill could have a very harsh impact on IT sector and its customers in the US.

According to Som Mittal, NASSCOM President, “the mobility of skilled manpower across borders does not constitute an immigration issue at all. It’s more a trade related issue. This now becomes a new form of non-tariff trade barrier. This has to be sorted by the two governments across the table.” 

More than Indian labour, US companies will be affected badly as they are outsourcing so much work to Indian companies.

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