August 30-31, 1998
Inter-connected stock exchange on trial runs
The recent crises in overseas markets did affect Indian
markets in a limited way because their linkages with global markets were relatively weak, according to the Securities and
Exchange Board of India executive director Pratip Kar. He has called for rapid technological upgradation in trading, delivery, settlement of shares and financial payment system in order to create confidence among the investors.
HC dismisses PIL against award of Jayankondam power project to RIL
The Madras high court observed that the
petitioner, the Tamil Nadu People Welfare Association of Tiruchurapalli, had neither substantiated that the award of the contract
was not genuine nor proved the allegation that the Tidco Act was
vitiated by arbitrariness.
Centre's nod to Tata airline will make India seem resurgent, says MPs' group
The United Parliamentary Group has written to the PM that in spite of the high success of the Resurgent India Bonds issue,
investors will remain unimpressed until a lead project involving foreign participation is okayed. Such a project will be identified
as a sign of resurgent India. ''We believe that one such project could be the Tata airline project,'' it said.
Cabinet committee moots open market wheat as part of price-check measures
The department of edible oils has been asked to immediately
consider import of additional quantity of edible oils to keep prices
under check. With regard to wheat, the procurement has
been of the order of 12 million tonnes and the government has
contracted import to the tune of 1.5 million tonnes.
Taj hotels group learns future lies in east, southeast, not west
Chairman Ratan Tata said the company has withdrawn from the Bandra-Kurla real estate development project in Bombay. In the process, the company has lost Rs 40 million as earnest money. The company is exploring possibilities of converting the Wellingdon Palace in South Mumbai into a hotel or an apartment complex.
Bombay-Sinnar expressway tipped to help hotel industry
The Sinnar Industrial Estate will
start functioning within a year and a decision to sanction a 158 mega-watt independent
thermal power supply centre for SIE will be
taken soon, according to Maharashtra's deputy chief minister Gopinath Munde.
Weekly Review : Five days of hope and despair
August 29, 1998
UK body hisses over beer ads: Cobra withdraws, Kingfisher gets the kicks
It's a B(ig) story: of beer, brand-brawls, b(ad) blitz, Bedford, Bangalore, Billimoria and Britons. It was also a wild one, involving Cobra and Kingfisher. Until the UK's Advertisement Standards Authority blew the whistle to stop what it thought was Cobra's misleading ad campaign.
Government paves way for FDI in cigarettes
The move toward foreign direct investment has become necessary due to falling tobacco prices and the need to attract foreign investment in the post-nuclear phase. Tobacco farmers in Andhra Pradesh were reported to be unhappy with sluggishness in prices, which was attributed to presence of only three to four large cigarette companies in India.
Smooth ride helps two-wheeler segment to buck downtrend
CRISIL expects the two-wheeler industry to structurally change from being a commodity industry governed by strengths in distribution and pricing to an industry which is driven more by product features and branding. This is likely to pose new challenges to major players in terms of both preserving their
respective market shares as well as in achieving volume growth.
THE REDIFF BUSINESS SPECIAL
SC rules against hotels on Goa's Palolem coastline
In upholding the Bombay high court order directing the Canacona Municipal Corporation to demolish all the hotel constructions within 200 metres of the high tide
line, the Supreme Court appears to have clearly indicated that it would not
tolerate violation of the judgement it had passed two years ago on the coastal regulation zone petition filed by M C Mehta.
Forex: Rs 42.53/54; rupee down four paise
BSE: 2908.10; Sensex crashes over 66 points
NSE: 849.80; Nifty loses overs 27 points
August 28, 1998
Seven years for Hiten Dalal, Mohan in Canfina scam; special court acquits 2 others
Delivering his judgment, Justice V N Variava said, "Scams after scams are taking place and money is being siphoned out systematically in illegal manner. It is the time when the court sends a message to the people that even if the justice is delayed it is sure to follow. And especially in this case since the amount involved was huge sum of Rs 330 million which was siphoned out from the system illegally."
Hegde downplays sanctions, asks Turkey to invest in India
Reiterating that nuclear-related sanctions had little impact, India's commerce minister has urged Turkish businessmen to take advantage of the vast investment opportunities in India, especially in its infrastructure sector. He pointed out that India had managed to attract substantial foreign direct investment in recent years.
Kerala to oppose income tax on NRI savings
Kerala's health minister Shanmughadas said that any move to impose tax on the savings of the NRIs will be resisted strongly by the government. He said that the remittances from NRIs in the Gulf countries were the backbone of Kerala economy and any attempt to destroy it will be opposed tooth and nail.
Improved Act for government securities planned
The Public Debt Act dates back to pre-Independence days when
the marketable debt with which this Act deals constituted almost the entire borrowing of the government. This is no longer valid as the non-marketable debt or liabilities of Central government were Rs 2.76 billion at the end of 1996-97.
Government clears way for private role in hydro power sector
The object of the new hydro power development policy is to exploit India's vast hydro-electric potential at a faster pace with emphasis on small- and mini-hydel projects. Under the policy, the country will augment electric power by 9,000 mega-watts with 550 MW coming from private investors and the rest from the public sector.
Forex: Rs 42.50/52; rupee down two paise
BSE: 2974.83; Sensex loses over 18 points
NSE: 877.45; Nifty gains over five points
August 26-27, 1998
The great purchasing power of rural India
Indian and multinational companies are eyeing rural India, a burgeoning, untapped market estimated at nearly 150 million. They discern a trend towards consumerism as the rural market grows twice as fast as the urban market. ''It's astounding... the rural market is now speaking the voice of the city. Our (car) sales have recorded a near 100 per cent jump in the countryside during the last year," says a Maruti official. Induction of Rs 140 billion through the government's rural development schemes in the Seventh Plan and about Rs 300 billion in the Eighth Plan is believed to have significantly contributed to the spurt in demand for all kinds of products.
RIB-happy SBI plans overseas expansion, foreign currency loans to FIs
State Bank of India would initially park about $ 1 billion abroad in order to help the Indian corporates in foreign currency borrowings and to lower the benchmarking of lendings by others in rupee as well as external currencies for infrastructural development. It would also invest in government securities.
Goa rules after-shave is toilet stuff, asks Colfax to pay Rs 400 million as excise
Goa excise commissioner's order states that ''the after-shave lotion could not classified as medicinal preparation merely because its individual component has medicinal properties as claimed by the Colfax Laboratories''.
Housing gets infrastructure status; minister talks of FDI
''If the private sector does not fulfil its social responsibility, I'm going to allow foreign direct investment in housing sector,'' Ram Jethmalani said. Approved housing projects henceforth can avail several fiscal concessions, 100 per cent deduction from profits for the first five years and 30 per cent deduction for
the subsequent five years.
IA union threatens strikes and worse against Tata airline
According to the Air Corporations Employees' Union, in view of the present circumstances of a negative growth in the
civil aviation sector, coupled with the already existing excess capacity
in Indian Airlines, the proposal of Tata airlines should be rejected
by the government. Else, the national carrier would be in ''deep financial and operational crises''.
Bupa to study India's health insurance market
The IFC-commissioned project will assess whether initiatives for healthcare insurance could stimulate private sector business investment and result in wider access to high standard healthcare facilities for a greater number of people in developing economies. Medical insurance major Bupa will study markets in India, Argentina, Poland and Egypt.
Poverty incidence down, consumption expenditure up, reveal studies
A cross-sectional analysis for the years 1987-88 and 1993-94
showed that in both years, Bihar had the highest poverty followed by Orissa. West Bengal stayed put in the relative rankings. According to another study, the rise of monthly per capita consumption expenditure works out to approximately 22 per cent in rural areas and 17 per cent in urban areas between 1972-73 and 1993-94.
Gujarat okays Rs 47 billion water supply project
India to lift curbs on global communication gadgets
Forex: Rs 42.48/50; rupee remains steady
BSE: 2993.36; Sensex gains over 43 points
NSE: 871.90; Nifty gains 12 points
August 25, 1998
RIBs collect $ 3.46 billion, market calls it 'decent success'
Foreign exchange dealers say the RIBs' impressive show will boost the foreign institutional investors' sentiment that might help shore up the sliding rupee.
Raju ups Sri Vishnu offer price to Rs 55, his stake to 50.23 per cent
Raju ruled out the possibility of any counter-offer by any
other party and as per the SEBI rules, the time period for such an
offer has elapsed. Also, the hike in offer price was a result of the increase in the share price of SVCL from Rs 16 on June 1 to Rs 45 on August 20 and Rs 48.50 today.
Despite economic crisis, airline industry will grow faster in Asia-Pacific region: A-I chief
The total fleet, according to Michael Mascarenhas, would more than double in the next 15 years, constituting an average capacity growth of approximately 4.5 per cent per annum. The active aircraft fleet size would grow from the present 10,000 to over 16,000 aircraft in the same period.
New yeast strain may keep alcohol industry in high spirits
The new strain, kluverommyces marxianusimb3, can be immensely
beneficial to alcohol industries located in warmer parts of the
country and the world. The new strain had been successfully tested at the Modinagar
distillery where it produced 7.3 per cent alcohol in 16 hours
without needing to maintain a low temperature. The commonly used yeast, saccharomyces cerevisias, on the other hand produced the same amount of alcohol in 26 hours.
Talks on for WB's Rs 8 billion loan for statistical system overhaul
The loan is for massive training in information technology, hardware and improvement of data collection. The project will involve improvement of data collection at the field level.
IBA chief rules out relaxation of NPA norms
A T Pannir Selvam said the non-performing assets of Indian commercial banks are not alarming, as is being made out. Of the total NPAs worth Rs 450 billion, accumulated over the past 20 years in banks in India, the priority sector accounts for about 50 per cent and industry for the remaining 50 per cent.
Banking sector feels the pinch of economic slowdown
However, after measures introduced by the Reserve Bank of India in January 1998, the valuation of the banking sector improved: banks reported good results in the first quarter of the year.
Goa planning to shelve power privatisation
Power secretary Rakesh Mehta says, ''We may now revive the old system of purchasing power from the private
generators by signing the PPAs till the central private distribution firm
takes over.'' Instead of scrapping it, he proposes to amend the privatisation policy, but by inviting competitive bids.
Vajpayee rules out competitive devaluation
Tata Tea has no links with ultras: Ratan Tata
Forex: Rs 42.46/47; rupee gains nine paise
BSE: 2950.44; Sensex gains over 27 points
NSE: 859.80; Nifty gains 4 points
August 23, 1998
'Governments do not create wealth, companies and entrepreneurs do so'
Prof Sumantra Ghoshal and Mukesh Ambani. The scholar and the scion. At Thursday's book release of Gita Piramal's Business Legends in Bombay, the two sparred over the concept of Creative Destruction. We present the transcript:
India may land in chaos if it ignores Indonesia's experience
'A purblind refusal to learn from the mistakes and successes of other societies is to a great extent responsible for the low rates of economic growth and the widespread poverty which characterises contemporary India. Indonesia and India have more affinities than differences,' says Dilip Thakore.
Karnataka asks US agency to study its economy
Information Minister M C Nanaiah said the agency would go into various sectors including state-owned undertakings, electricity board, taxes, foreign investment and also into the state's overall economic
Goa gets air cargo complex
Stocks Weekly Review: BSE loses 46 points
August 22, 1998
Things are going out of hand, says finance minister's new advisor
''Even the great state of Bihar, which is marching to a different drummer, will have to wake up at some stage when things come to a halt,'' said Mohan Guruswamy.
Call money interest rates shoot up to seven-month high
The call money interest rates shot up to the 30-35 per cent level, a seven-month high, on hectic covering by banks and other participants as the monetary measures announced by the Reserve Bank of India on Thursday created heavy pressure on funds.
'Rupee will fall again once shock of RBI measures wears off'
I-Sec says that the rupee appreciation will be a temporary reaction, since the prospect on the export front and capital inflows is not very
Delhi HC refuses to let Sahara, JVG, Kuber have their way
The Delhi high court has refused to revoke the order restraining certain companies of the Sahara, JVG and Kuber groups from disposing of their assets, except in the normal course of business.
Rs 14 billion scam in Prasar Bharati: Minister
Mukhtar Abbas Naqvi alleged that the chief executive officer of the Prasar Bharati made direct purchase deals with foreign companies by undertaking visits abroad and in several of such deals concluded actually no equipment had reached India.
PSU staff to get 10 pc interim relief
Decision to take effect from January 1, 1997.
Fertiliser subsidy raised by Rs 10 billion
The Union government has enhanced the subsidy package on fertilisers from Rs 30 billion to Rs 40 billion by increasing the concession component on phosphatic and potash fertilisers for the coming rabi crop.
Cocoa farmers strike gold in Andhra
Very few farmers in southern India which produces Asia's finest
cocoa have been able to realise its immense potential. The
production has not been able to meet the rising demand.
Forex: 42.56/58; Rupee gains 30 paise
BSE: 2922.61; Sensex drops by 67 points
NSE: 855.45; Nifty loses 13 points
August 21, 1998
RBI's aid-rupee measures help markets make remarkable recovery
The stock markets were dominated by the rupee's gain and a firm Global Depository Receipts market. Heavy short covering by market players in the index-based scrips resulted in a smart rally. However, analysts felt the RBI found it convenient to wipe out liquidity from the system by increasing the CRR level to 11 per cent. This may ease the pressure on rupee but in longer range, the Indian currency would have to match the depressed currency environment in other Asian countries, they added.
As Sinha reposes faith, RBI hikes CRR to 11 per cent, repo rate to 8 per cent
The new CRR will be effective from August 29. The RBI
said the rise in repo rate will be reviewed periodically
keeping in view the liquidity conditions.
Delhi HC upholds Bailadila mines' transfer to Mittals
The judgement said it was not possible to accept the contention
in the public interest litigation that the transfer of iron ore deposits was contrary to the industrial policy of Madhya Pradesh.
Mahindra shareholders okay plan to acquire Gujarat Tractors
During the period between April and August 1998, the company
produced 24,585 and sold 22,749 vehicles as against 27,745 and
24,792 in the corresponding period last year. In the farm equipment sector, it produced 19,806 and sold 23,541 tractors during the same period as against 26,873 and 25,202 units.
IDBI's Q1 study reveals downtrend in metals, upswing in electronics
Gross profit of India's corporate world
rose by 17.3 per cent during the period. Industry groups such as
electronics (125 per cent), leather and leather products
(992.5 per cent), cement (79.5 per cent), motor vehicles
(53.2 per cent), chemicals (51.5 per cent), aluminium (42. 2 per cent), pharmaceuticals (41. 9 per cent) and motor cycles and scooters (35 per cent) recorded high growth in gross profit.
Welcome FEMA, Money Bills, experts urge businessmen
A seminar organised by the Indian Merchants' Chamber in Bombay threw up interesting perspectives. Tax consultant H P Ranina said the Prevention of Money Laundering Bill's primary aim is to curb the use of tainted money for committing heinous crimes, not scare businessmen. Chartered accountant Dilip Thakkar said FERA had three major features: extra territorial jurisdiction, power to assume mens rea (criminal intent), and extended arm to reach the alleged aides and abettors. However, FEMA has retained only the first feature, and none of the latter.
RIBs net $ 3 billion, 63,000 apply
SEs agree rolling settlement is not possible now
Gill's Prasar Bharati posting challenged
Montek begins Planning Commission stint
Forex: Rs 42.82/92; rupee recovers 68 paise
BSE: 2989.60; Sensex spurts 105 points
NSE: 868.70; S&P CNX Nifty up 30 points
August 20, 1998
FM unveils plans to improve excise and customs collection
The existing slabs of eight to nine different rates would
be coalesced into three broadly defined rates. "This will be an enormous step forward for simplification of excise duties," Yashwant Sinha said. He also reiterated that the fiscal deficit would be kept at the projected level of 5.6 per cent. There was no reason for any despondency on the tax front as the government would be able to meet the Budget target. On collections, he said the corporate tax collections went up by 121 per cent and income tax collections by 6.42 per cent between April and July this year compared to last year.
Bihar's granite deposits could be treasure troves, say experts
Recent sub-surface and airborne geotechnical explorations by the
Geological Survey of India in south Bihar identified granite deposits in areas with good transport facility. Aggressive scientific exploitation is expected to yield high revenues. Some rocks had eye-catching designs resembling tiger skin, zebra stripes and eyes which have tremendous export potential.
Survey reveals August 22 truckers' strike won't affect economy
According to a survey conducted by the Indian Foundation of Transport Research and Training, the proposed strike does not have the potential to last long and the participation level may not cross even 50 per cent even if diehard opinion among the strikers prevails. It also hinted at an amicable settlement between the transporters and the government.
Sanctions not pragmatic, says Sangma
The former Lok Sabha speaker considers India as central to the scope of European Union's 'new Asian strategy', oriented to strengthening political relations, peace, liberalisation, trade and development. Criticising the post-Pokhran sanctions, he said, ''Pragmatism would need to be displayed by EU as an institution and the member-states. India as an EU partner and a global player cannot be exempted from this pragmatism.''
Airport issue: Ball is in Tata's court, says minister
'IISc-Monsanto tie-up not for gene project'
Third tranche of ICICI bonds to open on Aug 27
Competitions to unearth low-cost housing designs
Forex: Rs 43.55/58; rupee down 20 paise
BSE: 2884.59; Sensex gains over 16 points
NSE: 838.30; S&P CNX Nifty up five points
August 19, 1998
Indian companies' show mixed but getting better, says S&P's team
In Bombay for a CRISIL-organised meet, two Standard & Poor's directors said state-owned enterprises in India must be analysed
on a stand-alone basis and no guarantee or sovereign support should be given. Citing the case study of Baoshan Iron and Steel Corporation of China, they said the government must provide a favourable policy and financial support to the enterprises with managerial autonomy and market-based decision-making. Relatively new companies are more able to adjust to the market-driven economy, they said.
GMDC diversifies into power, to set up Rs 12 billion plant in Kutch
The power generated will be sold to the Gujarat State Electricity Board. The power purchase agreement will be signed within the next four weeks. The fuel will be generated from lignite and GMDC will finance the total equity requirement, which is around 20
FM assures counter-guarantee for Vizag project, rupee stability
Addressing a FICCI session in Bangalore, Yashwant Sinha said the Union government had not undone even a single
measure of the liberalisation process that was initiated in 1991.
He stressed that all the soft options of the last
seven years had exhausted and the country was now facing
the most difficult phase in the liberalisation process in which the
core of the reforms process needed to be implemented. The
government, he said, is taking steps to evolve political consensus
to ensure that the process generates confidence among the public.
Sangma moots training as anti-dote to unemployment
The only solution to
joblessness is initiating special courses apart form the general
curriculum, the former Lok Sabha speaker said. Earlier the target for full employment was
year 2002. But now it is year 2011, when the population will be
around 1.11 billion. To realise this, a 8-9 per cent GDP growth
is a must, he stressed at a Youth Congress meet in Bombay.
THE REDIFF BUSINESS COLUMNISTS
Government to drop accounts falsification section from Money Bill
Although industry and business circles are protesting against various provisions of the Prevention of Money Laundering Bill, mandarins in the ministry of finance have made up their mind to dilute it by dropping the section dealing with the falsification of account, says Rajiv Shukla.
Bollywood trains guns on video pirates
Delay likely in SC's Cogentrix hearing
Beware of plantation companies, cautions SEBI
Forex: Rs 43.35/38; rupee down 19 paise
BSE: 2867.99; Sensex loses 49 points
NSE: 854.55; S&P CNX Nifty loses over nine points
August 18, 1998
Asian crisis, holidays blamed for RIBs' moderate show, but SBI remains optimistic
SBI has not officially announced the actual amount raised so far through the Resurgent India Bonds. But reliable sources told Rediff On The Net that it is ''very close'' to the target of $ 2 billion. A source at a merchant banking firm said: "The emerging markets always faced this kind of problem. I'm sure that SBI will achieve its target before August 24."
RIBs' early closing date extended to August 24
SBI has said the decision was taken due to persistent demands from investors worldwide and a number of intervening holidays in all the markets like southeast Asia, India, the Middle East and the US reached by the bank.
Rupee in for testing times, stability depends on RIBs' success
According to an I-Sec report, the call money interest rate tightened near 7 per cent following volatility in forex market. However, the liquidity in the system continues to be comfortable and Rs 20.01 billion was outstanding in repos with the RBI on August 14. Market sentiment is likely to be positive with inflows from the proceeds of RIBs.
Credit Suisse rates India second best after Hong Kong for investment in Asia
A survey report says that the percentage
of Indian companies engaged in creating shareholder value is the second highest in the region. While everyone is preoccupied with the expected impact of the Japanese currency crisis, India would be relatively safe. India's exports to Japan account for only 7.3 per cent of the total while exports to high-growth countries account for 47 per cent.
Delicensed sugar, closure of 9 PSUs part of industry ministry's 'radical reforms'
Sikander Bakht said that the industry ministry has proposed de-reservation of some 300 out of some 800 items in the small-scale industry sector but the prime minister has rejected the proposal.
SCI, DCI, CSL rated 'excellent' PSUs
Shipping Corporation has drawn up a plan for acquiring 44 vessels involving an investment of about $ 1.23 billion. Its turnover during 1997-98 was Rs 2.40 billion. Dredging Corporation has made profits of Rs 536 million, Rs 610 million and Rs 746 million in the last three financial years respectively. So has Cochin Shipyard: in 1995-96 (Rs 184 million), 1996-97 (Rs 126 million) and 1997-98 (Rs 104 million).
Price-rise, VAT rock Nepal as government blames it on nature
According to economist Sudarshan Kumar Bista, the basic problem is that inflation has been allowed to run out of control pushing
commodity prices higher. Worse, the government has also
largely remained silent, not even explaining the reasons behind
the price hikes.
Forex: Rs 43.17/18; rupee loses seven paise
BSE: 2917.07; Sensex loses over 51 points
NSE: 854.55; S&P CNX Nifty loses over nine points