The Indian government has decided to lift the cap on the number of Special Economic Zones (SEZs) to be established in the country. SEZs are special regions deemed to be foreign territory for the purposes of trade operations, duties and tariffs, offering fiscal incentives and simpler customs, banking and other procedures. The decision was taken by the central government considering the high demand coming from a number of states. An Empowered Group of Ministers (EGoM) overruled the Finance Ministry’s apprehensions of the revenue loss due to the heavy tax incentives offered to SEZs.

Finance Ministry had objected to the decision saying the policy would result in the revenue loss of more than $15 billion (Rs. 70,000 crore) to the government. The Commerce Ministry, on the other hand, projected that the government would instead gain revenue of about $9.5 billion (Rs. 44,000 crore) from the zones over the next 5-10 years. The zones are also expected to create several lakhs of new jobs. The Board of Approvals in the Ministry of Commerce, however, will take up new proposals for setting up SEZs only after a review of the functioning of the SEZs already cleared. The EGoM would meet to decide on new zone after 75 out of the already approved 150 SEZs become operational in the next 5-6 months.

Aiming at rapidly expanding its mobile services to all towns and cities in India's 15 telecom circles at reduced operational costs, India’s largest GSM mobile services provider Bharti Airtel has signed a three-year, $1-billion network expansion deal with Telefonaktiebolaget LM Ericsson, the world's largest supplier of telecommunications equipment. The Swedish telecom vendor Ericsson already manages more than 70% of Airtel's networks. As per the deal, Ericsson will upgrade Airtel's network with next-generation technologies such as mobile softswitch solution, which paves the way to an all-IP network.

Earlier, Bharti Airtel had entered into two similar deals with Ericsson—first a $400-million deal in 2004 for building and managing its networks across 13 circles followed by another $250-million deal in 2005 for expanding its GSM/GPRS network in all 15 telecom circles. The new deal includes design, planning, supply & installation and commissioning of Airtel networks in all circles. Through this deal, Airtel will be able to channel its resources and expertise to its core areas of product innovation, value added services, marketing, branding and pricing. The 15 telecom circles coming under the scope of deal are Delhi, Haryana, Punjab, Himachal Pradesh, UP (West), Andhra Pradesh, Tamil Nadu, Chennai, Karnataka, Kerala, Rajasthan, UP (East), Jammu & Kashmir, Assam and the North-East.

The Government of India is now planning to sell its residual 10.2% equity stake in Maruti Udyog Limited (MUL), the largest Indian car manufacturer, during the current fiscal. The government had divested its 8% stake in MUL, in favour of banks and raised $340 million (Rs. 1,564 crore) last year. The ministry of heavy industries has already conveyed to the ministry of finance that it has no objection to divestment of the government's residual stake in MUL.

The value of the government's stake in MUL is around $540 million (Rs. 2,500 crore). As the government is a minority shareholder in MUL, it is not represented on the MUL board. However, this disinvestment is not going to take place soon as all disinvestment decisions, as of now, have been officially put on hold, and besides that this proposal has to be approved at many levels. Even if the finance ministry gives its consent to the sale of residual equity stake in Maruti, the go-ahead from the Union Cabinet will be sought. Thereafter, an inter-ministerial group will decide on the modalities of the sale.

According to the Minister of Heavy Industries, Santosh Mohan Dev, the automotive industry had registered a 20% growth in 2005 and had contributed to 5% of GDP. With the current turnover of the industry being estimated to be $32 billion, auto exports from India have been to the tune of $3.5 billion.

It’s the end of an era for India’s second largest IT services exporter Infosys Technologies. On the occasion of his 60th birthday on August 20, 2006, the founder chairman of Bangalore-headquartered Infosys Technologies, NR Narayana Murthy, formally stepped down from the top post of Infosys. It was a day of sense of happiness as well as loss for Narayana Murthy who anchored his company to dizzying heights and successfully guided Infosys to become one of the most-admired IT companies in the world. As he himself put it after stepping down: “Relinquishing all executive power at Infosys is like giving your daughter away in marriage. You are happy because she has grown up to be what she is - a confident youngster, that she has joined somebody with whom she finds joy, happiness and all of that. At the same time, you remain anxious about her; you feel a sense of loss."

It was under his supervision that Infosys, whose current market cap is worth $22 billion, became the first Indian company to be listed on the Nasdaq in March 1999. Only recently, Infosys had added another milestone by becoming the first company—in India as well as in Asia—to remotely ring the NASDAQ Opening Bell. However, Narayana Murthy will continue to function as a non-executive chairman and chief mentor to the company.

Azim H. Premji, the chairman of the third largest Indian IT services exporter Wipro Limited, has made it to the Forbes business magazine list of the world’s 10 richest tech titans. He has been placed at sixth position. With a net worth of whopping $13.3 billion Azim Premji has moved ahead of Google Inc., an information search engine founders Sergey Brin and Larry Page, eBay, a BtoC e-commerce portal founder Pierre Omidyar and founder of German business software company SAP AG, Hasso Plattner.

Ahead of him are Microsoft Corp., world’s largest IT company chairmain Bill Gates with a net worth of $50 billion, Microsoft co-founder Paul Allen who has a net worth of $22 billion, founder of Dell Inc., provider of personal & portable computers and servers Michael Dell with a net worth of $17.1 billion, Oracle Corp., leading database & enterprise solutions co-founder Larry Ellison with a net worth of $16 billion, and Microsoft CEO Steve Ballmer with a net worth of $13.6 billion.