LIC, HDFC Bank lead advance tax payouts in 2nd quarter

Financial sector companies, led by life insurance giant LIC and private lender HDFC Bank 2.38%, today posted a healthy increase in their second quarter advance tax payout belying sluggishness in the economy.
Life Insurance Corporation (LIC) paid an advance tax of Rs 1,300 crore, compared to Rs 1,165 crore it had paid in the second quarter of last fiscal, income tax officials said here.

HDFC Bank's tax payment increased to Rs 1,100 crore from Rs 800 crore last year while its larger rival ICICI Bank 4.97% saw its second quarter advance tax outgo jump to Rs 815 crore from Rs 650 crore, an official said.

Advance tax is a staggered way of paying income taxes through the year and is generally taken as a barometer to corporate earnings for the period.

The deadline for filing the advance tax returns for the second quarter is September 15 and more companies are expected to make their tax payments tomorrow.

State-run lender Bank of Baroda's second quarter tax outgo went up to Rs 620 crore from Rs 600 crore while Dena Bank's payments saw impressive jump to Rs 180 crore against Rs 77 crore it paid last year, officials said.

Payments from foreign banks also displayed a jump with Citi leading the way with Rs 400 crore, about Rs 100 crore more over the the amount paid last year, they said.

Among other sectors, FMCG giant Hindustan Unilever's tax outgo rose to Rs 300 crore from Rs 190 crore while for Ambuja Cement , it jumped to Rs 160 crore from Rs 95 crore in the corresponding period last year, they said.

Auto major Mahindra & Mahindra saw its advance tax payments increase to Rs 200 crore from Rs 176 crore, they added.

**Source :- MC

Growth target in 12th Five Year Plan cut to 8.2% from 9%

Moneycontrol Bureau             

Prime Minister Manmohan Singh today said the 12th five Year Plan (2012-2017) was targeting an 8.2% growth in the economy. This is lower than the 9%-plus growth that was being targeted earlier. In July, Deputy Chairman of the Planning Commission Mr Montek Singh Ahluwalia had said that it was "not possible to think of an average growth of 9% in the 12th Five Year Plan", because of the various constraints facing the economy. (read here)

However, Manmohan Singh has not completely given up on the 9% target that looked within reach just a year ago.

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PM warns policy logjam could slow growth to 5%

"The economy has gained many strengths. Our immediate priority must be to orchestrate a rebound in the second half of the current year. We should then try to accelerate growth to reach around 9% by the end of the Plan period," the Press Trust of India quoted him as saying at the meeting of the Full Planning Commission, which was called to approve the 12th Five Year Plan document.

At the same time, he said that it was necessary to revive investment sentiment to achieve the 8.2% target, and that growth could fall as low as 5% if there was a policy logjam. He also said there was a strong need to accelerate farm sector growth to around 4%. He was hopeful that foreign capital could be attracted once the fiscal deficit situation was under control.

The Planning Commission is aiming for an ambitious USD 1 trillion investment in the infrastructure sector during the Plan period. Singh stressed on the need for more public-private partnership for infrastructure development in the country.He said he would personally review the performance of infrastructure ministries.

He also said India's import dependence was rising and that there was urgent need to improve energy efficiency. He pegged the current account deficit during the 12th Plan at 2.9% of GDP.

**Source :- MC