14.11.2006

• Service tax on entry and exit loads in mutual funds
• Loads are charges that investors bear while buying or selling mutual fund units, and MFs (Mutual Funds) use it to recover scheme expenses on distribution, marketing, advertisement and roadshows.
• The government (DGCEI – Directorate General of Central Excise Intelligence, to be precise) feels that entry or exit load is a consideration charged by mutual funds for providing services in relation to asset management and thus be liable to service tax.
• Fund houses argue that mere receipt of money is not enough for levy of service tax since, unlike banking services, this is not specified under any head and that loads are not accounted as income for the fund.
• Press Note 5 of 2005
• It lays down guidelines about FDI in telecom. It allowed FDI to the tune of 74% in telecom. Issued in November 2005, its implementation has been put on hold as the DoT (Department of Telecom) has not been able to arrive at a consensus with the different ministries on its various controversial clauses.
• Siachen issue with Pakistan
• Indian troops currently occupy advantageous positions along the 76 km long glacier in Siachen.
• India expects Pakistan to accept the actual ground position line (AGPL) before pulling back its forces that have been stationed there since 1984.
• For Pakistan to do so would tantamount to accepting the AGPL as the international border which would mean a reversal of its stand that India should retreat to the positions held in 1972 as laid down by the Shimla accord.
• Renowned mountaineer Narendra Kumar first uncovered Pak designs on the glacier. In 1978 he found evidence of forays by foreign teams with the active connivance of the Pakistan army. Three more expeditions were conducted before finally in 1984 GoI decided to prevent Pakistan’s designs in getting a toe hold in the area.
• Since then Indian and Pak troops are in a bitter standoff, with truce having been declared in the area in 2003.
• Siachen issue one of the 8 issues covered under the composite dialogue process with Pakistan.
• Size of Radio industry in India and world
• By 2010, it is slated to touch Rs. 1200 cr in India.
• By the same time it is expected to be $58.8 bn worldwide.
• Radio advertising presently has a 2% share in the total ad-spend in the country.
• Figures and facts about global air traffic
• It is growing 3% every year.
• Its contribution to carbon dioxide emissions is 2%.
• The measures taken to reduce the emissions have resulted in saving about 11.9 mln tonnes of carbon dioxide emissions in 2005. In money terms it means a saving of $2.4 bn.
• Compared to the 1970’s airlines now use 70% less fuel and produce 70% less carbon dioxide.
• On an average a new aircraft consumes 3.5 litres per passenger per 100 kms. This is stated to be comparable with the fuel efficiency of hybrid cars.
• Pests affecting coffee produce in India
• Arabica – one variety of coffee produced (the other being Robusta) is affected by White Stem Borer.
• Coffee Board is making efforts to develop an Arabica strain which will not be susceptible for this pest.

Today’s topic for discussion: India produces ethanol indirectly from a byproduct of sugar, i.e., from molasses. Should ethanol production be de-linked from the sugar economy?

• Why this question arises is because of the shortage in ethanol staring in our face in view of the mandate for blending ethanol with petrol from November 1^st. Such blending is supposed to be more combustion efficient and save more on our fuel bill. But it also creates a huge demand for ethanol which the country’s current production is not able to meet.
• India’s ethanol production is currently at 1.75 bn litres i.e., 175 cr litres.
• India’s total annual consumption of petrol is 10 bn litres. Of this about 5% (0.5 bn litres) will have to be doped with ethanol. It is estimated that such blending would need an additional 610 mln litres of ethanol.
• There is existing demand for 180 cr litre by the domestic chemical industry.
• As all this is surely going to lead to ethanol shortages following suggestions are advanced:
• As potable alcohol has only up to 40% alcohol content, potable alcohol industry should look for alternatives instead of depending on molasses. It should produce alcohol directly from grain.
• Tapping production of ethanol from cellulosic plant matter and from low water intensity crops like sweet sorghum.
• Buying cane acreages from Brazil.

If you have any other suggestions to solve this problem, please use the comments feature below and key in them.