Companies & Sectors
CBI seeks Attorney General's opinion on RIL’s KG Basin cost

According to sources, the CBI has completed its inquiry into the alleged conspiracy in allowing RIL to raise cost of developing the KG-D6 field to $8.8 billion in 2006 from $2.39 billion proposed in 2004

New Delhi: The Central Bureay of Investigation (CBI) has sought opiion of the Attorney General on registering a case in the alleged artificial cost inflation by Reliance Industries Ltd (RIL) for the development of eastern offshore KG-D6 fields, reports PTI.

The CBI, sources said, has completed its inquiry into the alleged conspiracy in allowing RIL to raise cost of developing the KG-D6 field from $2.39 billion proposed in 2004 to $8.8 billion in 2006.

Controversial technocrat VK Sibal was the head of Directorate General of Hydrocarbons (DGH) which gave RIL approvals for raising the cost on the plea that gas reserves as well as cost of services have gone up.

Operators like RIL are allowed to recover all their cost before sharing profits with the government. Higher capital cost directly impacts the government's revenue.

The CBI registered a preliminary enquiry into the case in November 2009 on request of the Oil Ministry following several objections raised by Central Vigilance Commission (CVC) on the KG-D6 deal.

CBI sources said that probe has been completed in connection with the case and the matter has been referred to the Attorney General seeking legal opinion in the matter.

During its probe, the agency had taken the ministry's assistance to understand the arguments offered by Reliance when it raised the cost of developing Dhirubhai 1 and 3 gas fields in the KG-D6 block from $2.39 billion proposed in 2004 to $5.196 billion in Phase-1 and another $3.3 billion in Phase-II.

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Maruti Suzuki says cannot 'afford' petrol cars; cuts production

Maruti Suzuki recently stopped production of petrol models, including the Alto, M800, A-Star, Estilo and Omni for three days to prevent inventories piling up further

New Delhi: Maruti Suzuki India, the country's largest car maker, said it decided to cut production of some its petrol variants, including the best selling Alto, as sales of such cars have declined due to high fuel costs, reports PTI.

"Petrol car sales are very low in these days as the market sentiment is down ... We do not believe in creating excess stock. So, we adjust our production accordingly," Maruti Suzuki India (MSI) managing executive officer for marketing and sales, Mayank Pareek said.

The company had recently stopped production of petrol models, including the Alto, M800, A-Star, Estilo and Omni for three days to prevent inventories piling up further, he added.

"Normally we have inventories for three weeks. However, for petrol models, it is now around four and a half weeks," Pareek said, without sharing any numbers.

According to sources, MSI had stopped production lines of petrol models on 25th-26th May and on 2nd June at its Gurgaon facility. Its Manesar unit worked normally.

"The company had cut production of 8,000-8,500 units of petrol cars in these three days," a source said.

In May, the company's sales declined first time after four consecutive months of growth. It had reported 5% fall in total sales at 98,884 units last month, mainly due to declining sales of petrol-driven small cars.

The company's volume-driven mini-segment cars, comprising the M800, A-Star, Alto and WagonR, fell by 29% to 29,895 units during May from 42,125 units in same month last year.

Last month, petrol prices in India witnessed the steepest increase of Rs7.54 a litre in its history. However, faced with a public outcry over the hike, a partial rollback was done by cutting the prices by Rs2.02 per litre in this month.

MSI had described the hike as a "disaster" saying that it would further dent growth of the automobile industry.

"This will further increase the skew between petrol and diesel vehicle demand, which is already very wide. This will severely affect the sales of entry level cars, which are mainly petrol driven," Pareek had said.

Last year, the petrol segment declined by 16.2% as the demand shifted to diesel vehicles. Now there will be more demand for diesel cars after the price hike but most of the manufacturers are running on full capacity for diesel vehicles, he had said.

Earlier, the company had said that sales of petrol cars will be down by 50,000 units in 2012-13.

MSI is, however, expecting that its overall sales in this fiscal will grow by 10%, primarily driven by diesel cars.

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Ashok Leyland gets $6 million order from Bangladesh

The Hinduja Group company would supply 50 units of its vestibule buses to Bangladesh for improving urban transportation in that country

Chennai: Hinduja Group flagship company Ashok Leyland sadi that it received its first overseas order for its for vestibule buses, worth $6 million from Bangladesh Road Transport Corporation (BRTC), reports PTI.

The Chennai-headquartered company, in a statement, said it received the order for 50 units valued at $6 million under the Indian Line of Credit scheme offered by for the improvement of urban transportation in that country.

An agreement to this effect was signed between BRTC and Ashok Leyland recently.

"We were the first to introduce vestibule buses in India and now are excited about introducing this vehicle in Bangladesh..", said Vinod K Dasari, managing director, Ashok Leyland.

Ashok Leyland has so far exported 9,500 vehicles across various ranges to Bangladesh, it said.

In 2011, Ashok Leyland had received its first single largest order for 290 double-decker buses valued at $23.3 million from Bangladesh, the statement added.

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