NEW DELHI, 22 December 2006 — The Indian government has decided to sell its remaining stake in the Indo-Japanese car venture Maruti Udyog Ltd. The government gave the final nod to sell its residual equity of 10.27 percent in the company at a meeting of Cabinet Committee on Economic Affairs (CCEA) chaired by Prime Minister Manmohan Singh.

After the meeting, Finance Minister P. Chidambaram told reporters: “The government will sell the remaining stake within this fiscal year or the next.” The government will sell its stake to banks and financial institutions, he said.

At present, Suzuki Motor Co. holds 54.2 percent stake in the venture. Bids for the stake sale will be invited soon, officials said. Given the current market price of Maruti Udyog shares, the government hopes to raise 270 billion rupees ($600 million) by selling its stake. Maruti shares were trading at 940 rupees, up 1.84 percent, in late afternoon on the Bombay Stock Exchange.

When Maruti Udyog was launched in 1981, it was a 50:50 joint venture between the Indian government and Suzuki Motor of Japan. Over the past four years, the government has been gradually offloading its share of equity in the company. In 2002, the government handed over its majority stake to Suzuki Motor.

That was followed in 2003 by a 27 percent disinvestment by way of an initial public issue. Eight percent stake was sold to financial institutions.

The government also gave its approval yesterday for accession to an international pact — the Hague Convention of 1970 — that would make it easier to collect evidence from abroad in civil or commercial matters.

While briefing reporters on this, Chidambaram said that the decision would establish a uniform procedure for sending, receiving and executing requests for taking of evidence to and from other countries.

This would simplify the litigation process and ensure greater certainty regarding admissibility of evidence obtained before Indian courts, which would facilitate speedier settlement of cases by Indian courts and thus benefit the parties involved in the litigation.

Australia, the United States, Britain, Germany, Russia, Sri Lanka and Singapore are among the 43 countries that have signed the convention. On becoming a party to the convention, India would not require several bilateral agreements. The Instrument of Accession to the Convention would be sent to the Ministry of Foreign Affairs, the Netherlands which is depository of the convention.

In keeping with convention’s requirement, the Law Ministry and high courts of all states and union territories would be designated as central authorities, Chidambaram said. Chidambaram also said the government had decided to give telecom operators until March 31, 2007 to comply with foreign direct investment norms. Earlier, the telecom operators having up to 74 percent FDI were required to abide by guidelines by Jan. 2, 2007.

The government is considering some big concessions for highly employment generating sectors in the forthcoming budget, Chidambaram said. Refusing to elaborate on these tax concessions, he said: “Wait for the presentation of the budget.”

Textiles, garments, gems, jewelry and leather are among the sectors which could benefit, officials said.