The central bank will send its comments to the finance ministry shortly. Sources close to the developments said a better way could have been worked out to increase the sectoral caps. The sources said while a cap was meant to protect the interest of the Indian shareholders in sensitive sectors, the new mode of calculation of indirect foreign holding provided for a circuitous way.
Indian reinsurer General Insurance Corporation has hardened its stance while negotiating reinsurance arrangements for the next financial year. During the first round of talks with non-life insurers, GIC said that it would pay at least 5 per cent lower commission on business that is reinsured with it. Further, it has sought a share in underwriting profits, which could be as high as 50 per cent, sources involved with the negotiations said.
Issue tied in with review of foreign bank operations in India. RBI had earlier proposed to defer the review, which is meant to provide guidelines for the presence of foreign banks in India from April 2009 onwards, given the current economic meltdown globally and in the domestic markets.
In the coming days, other lenders are expected to initiate similar steps to recover their dues from the company, which is facing the prospects of a change of management. IFCI executives said that the company revoked the guarantee earlier this month to recover its dues amounting to Rs 95 crore from Maytas Infra.
In a few months, private sector lender IndusInd Bank may have a new identity. The move was in line with the repositioning exercise initiated by the new management team led by Managing Director and Chief Executive Officer Romesh Sobti.
Shares of ITC, Axis Bank and Larsen & Toubro are likely to stay with the Specified Undertaking of the Unit Trust of India, which was to be wound up in June.Legal opinion received by the government suggests that SUUTI can exist as long as all investors in one of the schemes floated by the erstwhile Unit Trust of India have not redeemed their investment, sources close to the development said. The value of the shares of the three blue chips was estimated at over Rs 15,000 cr.
International hoteliers operating in the country through sales agreements with Indian hotels can expect some relief after the Delhi High Court ruled on January 30 that income paid by the Indian partner to its foreign counterpart is exempt from tax since it cannot be considered royalty or technical fees. The ruling in favour of US-based Sheraton International Inc was in response to an appeal filed by the Income Tax Department challenging the service agreement.
What's worrying for the public sector banks is the rise in delinquency in the housing portfolio, which does not include real estate. But a bank chief said that with low exposure to the real estate sector, the state-run banks have fewer worries. The other area of concern is credit cards but the operations of public sector banks in this segment are small compared with the likes of ICICI Bank, HDFC Bank and Citibank, the largest players in the business.
Less than half-a-dozen people have evinced interest in buying the eight apartments owned by the late Harshad Mehta and his family, partly due to a last-minute case filed by the stockbroker's mother, Rasila S Mehta.
In a possible precursor to further rate cuts, Finance Minister Pranab Mukherjee's meeting with public sector bank chiefs on Monday will review their benchmark prime lending rates and interest rates on loans for automobiles, homes, small and medium enterprises and non-banking finance companies.
When AS-15 became operative in 2006, the initial estimate for additional pension provisioning was estimated at Rs 6,000 crore. However, the latest wage revision may bring in an additional 275,000 bank employees who opted for PF. Banks may also provide for the pension liabilities of 65,000 employees who have retired but have been seeking resort to the defined pension scheme since 1996. This will require additional provisioning of Rs 6,000 crore.
Standard Chartered CEO-Asia Jaspal Bindra spoke to Anirudh Laskar and Sidhartha about the bank's plans and his assessment of the situation.
While the ministry sources clarified that the overall policy for fax editions is still under review, this proposal has been given approval on a case-to-case basis in FIPB's meeting held last week. The proposal was turned down twice earlier pending the review but the company had applied to FIPB under deferred proposal agenda in its meeting on January 9.
Official sources said the 2000-01 acquisitions -- notably the high-profile purchase of web portal India World Communications from Rajesh Jain for Rs 499 crore (Rs 4.99 billion) -- by Satyam Infoway could mark the start of the company siphoning funds overseas under the guise of acquiring companies. Satyam Infoway was merged with Satyam Computers in 2002.
Sixteen years after the stock market scam orchestrated by Harshad S Mehta, the custodian has put up eight apartments in a complex called Madhuli, which is occupied by his family in upscale Worli, for sale.
The move comes a month after three-day terrorist attacks in Mumbai on November 26 left at least 183 people dead and thousands wounded. A source close to the development told Business Standard that following 26/11, as the terror attacks came to be called, reinsurance rates have hardened in the global markets.
The government is considering setting up a special purpose vehicle (SPV) for financing of non-banking finance companies (NBFCs) following the reluctance of banks and mutual funds to make available funds for the sector.
The Department of Industrial Policy and Promotion in the Commerce Ministry proposes to scale back the Foreign Direct Investment ceiling for the tobacco industry from 100 to 74 per cent and insert a caveat that cigarettes manufactured in the new ventures or in upgraded facilities must be mainly for consumption outside India.Sources said the department, which is responsible for the policy on FDI, is finalising a cabinet note aimed at comprehensive review of the tobacco policy.
Unlikely to launch formal probe into IT firm's Maytas move.
The Reserve Bank of India has started a review of the non-performing asset or bad loan classification norms to ease the flow of credit to corporate groups.The move follows a reference from the government and is aimed at relaxing the norms temporarily to enable companies to access funds during the economic downturn that is putting pressure on cash flows and repayment capabilities.The review has been sought by the finance ministry following appeals from various industries.
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