Maha Mumbai SEZ in a jam: Residents, farmers oppose RIL's SEZ land buy

The Maha Mumbai multi-product special economic zone (SEZ), promoted by Reliance Industries, may experience difficulties in obtaining government approval. Some farmers and locals residing in the area where the SEZ is supposed to come up have officially registered their opposition to land acquisition. A number of land owners have informed the government that they do not want to part with their land and should not be made to do so.

Officials in the commerce ministry say that since the Centre had already decided that objection from even one land owner from the affected area would be enough to stall an SEZ project, developers will have to take some remedial action soon to save the situation. New rules notified recently by the government specify that land required for SEZs has to be surrendered willingly.

Commerce ministry sources said that the developers might have to exclude the area where they are facing resistance from the proposed SEZ. “It seems that the developers may have to lower their ambition and settle for a zone much smaller in size. Or else, the compensation package has to be made so lucrative that everybody accepts it,” an official said, adding that for some land owners in the area, adequate compensation may not be an issue at all. They are simply not willing to sell their land.

When contacted, a Maha Mumbai SEZ spokesperson said that the company had now come up with a very attractive compensation package. It is offering either Rs 40 lakh per hectare in cash or a combination of Rs 25 lakh per hectare, one job per family and 12.5% of developed land to the land owners. “We are hopeful that those who have expressed their unwillingness to sell, will accept this package,” the spokesperson added.

Interestingly, the validity of the in-principal approval given to the Maha Mumbai project runs out this week. The validity, however, is likely to be extended by the Centre under the new rules that limit the size of all SEZs to 5,000 hectares.

The government has decided to extend the validity period for all SEZs for a two-year period (one year at a time) if they apply for an extension before the validity period expires. In-principal approval is the first of the three-stage process the government’s board of approvals (BoA) follows while clearing SEZs. This is followed by formal approval when the land is acquired. After this, the SEZ is notified when certain formalities are fulfilled.

Sources say that one way to get around the problem could be to divide the area into a number of smaller SEZs keeping the problem areas out. Reliance Industries is attempting to chart a similar course for its proposed SEZ in Jhajjar, which had been planned over an area of over 10,000 hectares. For the Navi Mumbai SEZ, adjacent to Maha Mumbai, the company has received formal approval for a number of smaller SEZs.

The developers of Maha Mumbai had earlier proposed to build the zone over 10,000 hectares. However, with the empowered group of ministers (eGoM) on SEZs deciding, earlier this year, to limit the area for all SEZs to 5,000 hectares, the size of the zone has to be mandatorily reduced.

Read More......

IMPORT OF SENSITIVE ITEMS DURING APRIL JUNE 2007

The total import of sensitive items for the period April-June 07 has been Rs.4877 crores as compared to Rs.4371 crores during the corresponding period last year thereby showing an increase of 11.6%. The gross import of all commodities during same period of current year was Rs.226321 crores as compared to Rs.185988 crores during the same period of last year. Thus import of sensitive items constitute 2.4% and 2.2% of the gross imports during last year and current year respectively.

Imports of fruits & vegetables (including nuts), products of SSI, spices, marble & Granite, Tea & Coffee and milk & milk products have shown a decline at broad group level during the period. Imports of items viz. edible oil, cotton & silk, automobiles, rubber and Alcoholic beverages have shown increase during the period under reference.

In the edible oil segment, the import has increased from Rs.2407 crores last year to Rs.2802 crores for the corresponding period of this year. The import of both crude oil as well as refined oil have gone up by 15.7% and 30.9% respectively. The increase in edible oil import is mainly due to significant growth in import of Crude palm oil and its fractions, which has gone up by 28%.

Imports of sensitive items from Indonesia, China P RP, Brazil, Germany, Japan, Thailand, Australia etc. have gone up while those from Argentina, United States of America, Cote D’ Ivoire, Malaysia, Benin, Sri Lanka DSR, Egypt A RP etc. have shown a decrease.

Read More......

Export target to be met: Nath

The commerce ministry hopes to meet the $160 billion export target despite viewing the appreciating rupee as a deterrent in meeting the 2007-08 export target. “The rupee appreciation has impacted exports (till June). The government is seized of the matter,” the commerce and industry minister, Mr Kamal Nath, today said when asked about the dipping export growth over the last few months.

Mr Nath said the government was looking at several measures to ensure that the decline in export growth was arrested, including a new package of incentives for exporters.

With Rupee appreciating consistently against the Dollar, India’s first quarter export growth in the current fiscal decelerated to 7 per cent in rupee terms and in June, export growth was less than one per cent. In dollar terms, the export growth during April-June 2007 was 18 per cent against the trend rate of over 20 per cent witnessed in the recent past.

Read More......

Swiss government not to take Novartis case to WTO

The Swiss government indicated that it was unlikely to take Novartis AG's challenge to India's intellectual property rights regime to the World Trade Organization's disputes settlement body, local papers reported. The Madras High Court Monday dismissed a petition filed by the Swiss pharma major citing provisions of the Indian Patents Act and claiming that it was non-compliant with the Trade-Related Intellectual Property Rights (TRIPS) agreement.

Doris Leuthard, Swiss Federal Councillor to the Department of Economic Affairs, told Indian media that: 'The Swiss government never gets involved in any any judicial pronouncement of other countries. We accept any case which is settled in India. It is normal litigation in which one party happens to be a company while other is a country.

'We must have a reliable TRIPS system, and the one in India is good enough,' the Business Standard quoted her as saying.

Leuthard was in India to sign a memorandum on closer cooperation for the protection and promotion of intellectual property rights with Kamal Nath, India's Minister for Commerce and Industry.

The Hindustan Times quoted Nath as saying: 'Our (Indian) patent laws are WTO compliant. It is only one company that has raised its voice. In the last two years, since Indian patent laws became WTO compliant, no one has ever made any complaint.'

The complaint centres on Novartis (nyse: NVS - news - people )' anti-cancer drug Glivec, which was denied patent protection at the Madras High Court on Monday.

Novartis had sought a patent for Glivec in India, challenging the Indian patent law which -- in its current form -- does not protect incremental innovation.

India has a unique provision in its patent law -- Section 3(d) -- which excludes 'incremental innovation' from patent protection and denies patents for modifications to known medicines.

Indian law does not grant patents for modifications to old medicines, but only to properly innovative drugs developed after 1995.

The WTO recently urged India to improve its intellectual property system during Trade Policy Review.

Novartis had reiterated on Monday that it thinks Section 3(d) will have long-term negative consequences for research and development into better medicines for patients in India.

'Medical progress occurs through incremental innovation. If Indian patent law does not recognise these important advances, patients will be denied new and better medicines,' said Paul Herrling, head of corporate research at Novartis, on Monday.

Read More......

No tax relief for overseas services

The Union finance ministry will not exempt services rendered overseas for executing export orders from the purview of service tax. This is despite the commerce minister’s announcement of the relief while unveiling the export import policy. According to officials in the finance ministry, the 14.4% growth in exports in June 2007 did not justify sacrificing revenues by granting the exemptions. The June figure was lower than the 18% growth achieved in May 2007.

The officials said that though the commerce ministry may have announced the exemption of tax on services rendered overseas, the finance ministry had not found any firm evidence that granting such an exemption would in any way mitigate the impact of the appreciating rupee on exports.

In view of the unkept promises of the exim policy, exporters are having to bear the burden of 12.5% service tax on all payments remitted from the country for services like commission agents who book orders, haulage from port to customers’ premises and expenses incurred in participating in B2B events overseas.

Back of envelop calculations by export organisations show that such expenses constitute 10-15% of the billing amount and a 12.5% service tax translated into an additional payout of 2% of the total export turnover.

“International business does not offer margins of more than 2-4% and the additional liability of service tax wipes off export margins in big markets which are very competitive in any case,” said P K Shah of Nipha Exports and former chairman, Engineering Export Promotion Council (EEPC).

Read More......

Medicines likely to cost more

The prices of certain medicines, including vitamin B complex, are set to rise following certain changes in its export policy by China, according to sources in the pharmaceutical industry. The sources say China has recently decided to either withdraw or reduce incentives on the export of about 300 items, Medicines likely to cost more.including basic drugs used as raw material by the Indian pharmaceutical industry.

Though the Chinese authorities have made known their intention to withdraw or slash the sops sometime back, the decision has become effective from July 1, the sources say.

The price of riboflavin, used in a wide range of vitamin preparations, is being quoted at Rs 5,000 per kg in the market today as against Rs 1,000 a kg just two months ago.

The sources say as a result of unprecedented rise in the price of riboflavin several brands of multivitamin tablets will become costlier in the coming days. The major reason for the sudden spurt in price is the steep shortfall in supplies from China. They say the production of riboflavin in that country has gone down after the Chinese government enforced stricter environment and anti-pollution measures.

The Indian pharmaceutical industry has been importing active pharmaceutical ingredients (APIs) from China because many of them were about 15 per cent cheaper than those produced in India. Even many Indian API manufactures depended a lot on raw material from China, as it was much cheaper than what it costs in India.

Besides the raw material, certain types of pharmaceutical machinery like the ALU-ALU blister packing machines from China were also favourite with Indian manufacturers for its lower costs. The cost of such machinery was 25 per cent to 30 per cent lower than that in the Indian market.

Dr Sunil Sethi, managing director-cum-CEO of Sanchez Pharmaceutical, Tohana, who is also setting up a unit at Baddi in Himachal Pradesh where tax concessions are very attractive, says the recent developments will not only hit the pharmaceutical industry badly but will also make the drug formulations dearer.

Dr Sethi, who has recently come back after attending a pharmaceutical expo at Shanghai, says the move has disappointed the Chinese drug industry and it will affect the export of bulk drugs and intermediates from that country.

He says though it is not possible to assess the exact fall out of the development at this stage, but the Indian pharmaceutical industry will have to bear 10 per cent to 15 per cent extra cost on inputs.

The price of an ALU-ALU blister-packing machine from China starts from $ 15,000 while in India its price starts from Rs 10 lakh. Similarly, an automatic capsule-filling machine with an output of 1,200 capsules per minute is available for $ 20,000, which is equivalent to the cost of a semi-automatic machine in India.

Read More......

Novartis plea on patents struck down

MUMBAI/CHENNAI: In a much-awaited judgement, the Madras High Court has held as valid a legal provision unique to India, which stipulates that modifications of known medicines cannot be patented unless they make the drug significantly more effective. On Monday, the court dismissed a petition by Swiss pharmaceutical giant Novartis challenging the constitutionality of Section 3(d) of the new Indian patent law. Novartis has filed another case, an appeal against the rejection of patent for its anti-cancer blockbuster drug Glivec, which is still pending.

The Basel-based drugmaker had filed a petition with the high court last year, after the Glivec patent rejection, pleading that incremental innovation should be patented in India. While India’s patent law does allow patents for modifications of already-known medicines, Section 3(d) stipulates that these modifications must improve drug efficacy to qualify.

A division bench comprising justice R Balasubramanian and justice Prabha Sridevan, ruled that the Section 3(d) of the Act, as amended in 2005 (along with its explanation), is valid and could not be termed vague, ambitious or unconstitutional.

“The discovery should result in the enhancement of the known efficacy of the substance and the derivatives are significantly differing in properties, with regards to efficacy,” the bench ruled.

In its petition, Novartis had prayed to declare the provision as being non-compliant with TRIPS agreement, vague, arbitrary and in violation of Article 14 of Indian Constitution.

“It is a sad day for innovation,” said Novartis’s vice-chairman and managing director Ranjit Shahani. “Incremental innovation has value not just in improving therapeutic efficacy, but also in providing significant benefits in terms of drug delivery, patient safety and compliance,” he said.

Novartis has also noted that in order to compare the efficacy of the new version of a drug with the old one, clinical trials need to be conducted. But, such trials can start only after the drug is protected by a patent.

However, the court decision should not have any significant impact on the company’s financial performance, said analysts. Drugmakers such as Ranbaxy, Sun Pharmaceuticals, Cipla, Natco Pharma and Camlin Pharma were already selling generic versions of Glivec in India. Even an eventual denial of patent on Glivec would not change the current situation.

Novartis said that while it disagreed with the Madras HC’s judgement, it won’t appeal its decision to the Supreme Court. “However, we have opened an important debate on the value of incremental innovation and the World Trade Organisation may take up the issue. We feel that there are great inadequacies in the Indian patent law,” said Mr Shahani.

The now-famous Glivec case has kept alive the debate over the patentability of pharmaceutical substances. Product patenting was introduced in India two years ago through the third amendment to Patent Act. The question is about ascribing a commercial value (by way of grant of patent or its denial) to new forms, derivatives and delivery systems of existing drugs.

The domestic pharmaceutical industry welcomed the Madras HC judgement. “If Section 3(d) had been removed, a large number of frivolous patents would have been granted, denying patients access to affordable generic medicines,” said secretary general of Indian Pharmaceutical Alliance (IPA), Dilip G Shah. “At least 2,000 out of the 10,000-odd patent applications in India will be disqualified under Section 3(d),” he added.

Ranbaxy echoed IPA’s view. “Ranbaxy has consistently been of the view that the TRIPS agreement can and should be interpreted and implemented in a manner supportive of the rights of the WTO members, to protect public health, and in particular, to promote access to medicines for all,” said executive director - global corporate affairs of Ranbaxy Laboratories, Ramesh Adige.

While Section 3(d) remains unique to the Indian patent law, other countries are considering incorporating a similar provision in their patent law. “Philippines adopted a similar provision a few month ago, and more Asia-Pacific countries such as Malaysia, Bangladesh and Indonesia were waiting for this ruling to amend their patent law,” said Mr Shah.

Read More......

Novartis warns India of losing R&D biz to China

NEW DELHI: Multinational drug makers would prefer China for investments in pharmaceutical research so long as India keeps the bar for patenting a drug so high, warned drug major Novartis on Monday after the Madras High Court turned down the company’s challenge to the country’s patent law.

Novartis India vice-chairman and managing director Ranjit Shahani, who also heads a body that represents MNC companies, told ET that most of the drug majors have invested in China in the last two years in pharma research , while India did not attract any investments. “No company will go on setting up research centres on an yearly basis. Once it is set up in country , it may not look for further investments for some time,” said Mr Shahani .

A crucial patent law provision that describes what is patentable is set for more heated debates and divergent interpretations as Novartis’ appeal against the government’s denial of patent to Glivec is still pending. The provision stipulates that new forms of older drugs merits patents only if they vary significantly in terms of properties with respect to efficacy.

MNCs say that there are many inventions that may not be entirely new chemical entities but are very useful to the patients. “These have utility and value not just therapeutically, but also in terms of patient safety and compliance , cost of production and ease in transport in a country of extreme climatic conditions,” said Mr Shahani. “A large number of incremental innovations have significant practical advantages for the patient over the existing medicine, although they may not qualify as scientific breakthroughs.

Companies will invest in such improvements only if there is an assurance of ownership at the end of costly and tedious research ,” Novartis international corporate research head Paul Herrling had told ET during a recent visit.

The domestic pharma industry disagrees : “Why should a product be in the market if it cannot claim these essential qualities? And how could a company come up with another product at the end of the 20-year patent life and say the new product is more stable,” asks D G Shah, the representative of big domestic drug makers.

While lawyers would battle it out as Novartis’ appeal continues, the government is working on a new patents manual that is expected to reduce subjectivity in deciding what is ‘significantly more effective that the already known’ . “Any sort of guidelines would leave some subjectivity in deciding the newness and usefulness of an ‘invention.’ We would like the government to bring the manual in public domain for transparency ,” said Mr Shah.

THIS PILL WON’T KILL

The court decision should not have any significant impact on the company’s financial performance, analysts said Drug makers such as Ranbaxy, Sun Pharmaceuticals, Cipla, Natco Pharma and Camlin Pharma were already selling generic versions of Glivec in India Even an eventual denial of patent on Glivec would not change the current situation

Read More......

INDIA’S FOREIGN TRADE DATA: APRIL-JUNE 2007

India’s exports during June, 2007 were valued at US $ 11867.11 million which was 14.05 % higher than the level of US $ 10405.07 million during June, 2006. In rupee terms, exports touched Rs.48386.49 crore, which was 0.97% higher than the value of exports during June, 2006. Cumulative value of exports for the period April-June, 2007 was US $ 34303.50 million (Rs.141330.65 Crore) as against US $ 29044.58 million (Rs.132164.90 Crore) during the same period last year.

India’s imports during June, 2007 were valued at US $ 19195.69 million representing an increase of 36.68 % over the level of imports valued at US $ 14044.43 million in June, 2006. In Rupee terms, imports increased by 21.00 %. Cumulative value of imports for the period April-June, 2007 was US$ 54908.83 million (Rs.226321.35 Crore) as against US$ 40885.73 million (Rs.185987.92 Crore) during the same period last year

Oil imports during June, 2007 were valued at US $ 5664.99 million which was 9.85% higher than oil imports valued at US $ 5157.19 million in the corresponding period last year. Oil imports during April-June, 2007 were valued at US$ 14830.19 million which was 4.21% higher than the oil imports of US$ 14230.81 million in the corresponding period last year.

Non-oil imports during June, 2007 were estimated at US $ 13530.70 million which was 52.25 % higher than growth on non oil imports of US$ 8887.25 million in June, 2006. Non-oil imports during April-June, 2007 were valued at US$ 40078.64 million which was 50.36% higher than the level of such imports valued at US$ 26654.92 million in April-June, 2006.

The trade deficit for April-June, 2007 was estimated at US $ 20605.33 million which was higher than the deficit at US $ 11841.15 million during April-June, 2006.

Read More......

Spices exports to be hit by strong rupee

KOCHI: The Indian rupee has appreciated by nine per cent in July 2007 as compared with March 2007. This will have an impact on our competitive edge over other producing countries, which may result in some drop in the export of spices and spice products in the coming months, says a press release from Spices Board here.

During the first quarter of this financial year we exported 52,000 tonnes of Chilli valued Rs.288.50 crore against 2,3715 tonnes valued Rs.104.76 crore last year. The demand from the traditional buyers like Malaysia and Sri Lanka are on the rise. India is the main source of red chilli in the international market. After the lean production last year, the new Chinese crop will reach the market only by October. Pakistan, the other producer, may require a large portion of their September crops for domestic consumption. It is reported that the stocks held at different levels are minimal and hence any significant decline in the Chinese crop will put pressure on chilli prices in the next few months.
Seed spices

Among the seed spices, coriander, fennel and fenugreek performed better than last year. During the period April-June 2007, 6,100 tonnes of coriander valued Rs.22.48 crore were exported against 4900 tonnes valued Rs.17.98 crore last year. It is reported that the East European countries like Romania and Bulgaria, where coriander is produced, suffered drought condition and this may have some impact.

During the year, 2100 tonnes of fennel valued Rs.11.99 crore were exported against 1500 tonnes valued Rs.8.95 crore last year. In the same period, export of fenugreek increased to 4850 tonnes valued Rs.12.63 crore against 1940 tonnes valued at Rs.5.96 crore last year.

In the case of cumin seed, there is a decline in export. It came down form 8190 tonnes to 4000 tonnes. However, it is expected that the export of cumin is likely to pick up in the next few months. This is so as there are reports indicating crop loss in Syria due to rain. The export of value added spices like curry powder and spice oils and oleoresins have shown an increase of 6 per cent and 9 per cent respectively in terms of quantity. During the year, 2625 tonnes of curry powder valued Rs.24.17 crore were exported from India as against 2465 tonnes valued Rs.20.05 crore last year. It is significant to note that the unit value has increased from Rs.81 a kg to Rs.92 a kg. In the case of oils and oleoresins the quantity exported has increased from 1445 tonnes to 1575 tonnes and value realisation from Rs.121 crore to Rs.127 crore.
Spices imports

Import of some of the sensitive spices like pepper, cardamom (small) and turmeric has come down during the first quarter of 2006-07. Cardamom (small) import has come down by 44 per cent, pepper import by 8 per cent and turmeric by 22 per cent during the year. Import of other spices like clove, cassia, star anise, etc has almost remained the same as last year. These items are mainly imported for domestic consumption.

The Government has restricted the export obligation period to 120 days from the date of first import consignment cleared by customs under advance authorisation scheme for import and re-export of spices after value addition.

Read More......