Tuesday, September 8, 1998
today's calendar
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B U S I N E S S | Tuesday, September 8, 1998 |
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spotlight today's calendar |
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‘No business in Pak
can be run without bribes’ VSNL
to offer uplinking facilities |
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Name a problem, |
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Reliance
scheme for shareholders Fire
in Essar office |
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‘No business in Pak can be run without bribes’ ISLAMABAD, Sept 7 (UNI) — “Robber barons”, that is how author Shahid-ur-Rahman describes the 22 richest families of Pakistan in his book “Who Owns Pakistan?” The author traces economic corruption in Pakistan since Independence in this keenly sought after book. According to the book the new breed of Pakistan’s richest families consists of those who took huge bank loans without the intention to repay, during Gen. Zia Ul Haq’s rule, and used their political clout to grab thriving de-nationalised industrial units at throwaway prices during the rule of Ms Benazir Bhutto and Mr Nawaz Sharif. Mr Mohammad Ali Jinnah encouraged Muslim business barons to transfer their business from India to Pakistan after Independence and then during President Ayub Khan’s time the country was well on its way to becoming an Asian tiger. The 22 families, which were identified the richest in Pakistan in 1970, began losing ground due to the separation of East Bengal (1971) and then the nationalisation of industries started by Mr Zulfikar Ali Bhutto in 1972 and 1974.In the 11 years of General Zia’s rule there were cases of his favourites taking huge loans from lending institutions and later getting them written off. Then came Ms Bhutto who reversed her father’s nationalisation policy during 1988-90. When Mr Sharif came to power in 1990 he supported the re-creation of monopolies opening of public sector to private parties and privatisation of public units. When Ms Bhutto returned to power for the second time her government encouraged clandestine business deals and granted loans which were to be written off later.The privatisation process as advocated by Ms Bhutto and Mr Sharif encouraged massive corruption. The Privatisation Commission said in 1991 their formula for privatisation passed on the liabilities (of the units sold) to the people while the assets went to the new buyer. These units were given away at very low prices, says the book.Pakistani industrialist Yusaf Haroon is quoted as saying that “there is no business in Pakistan today which can be run without paying bribes to the ministers and secretaries.” Many defaulters managed to
sell off their business and left the country along with
the money thanks to their political connections. |
Spotlight
on Ludhiana LUDHIANA, Sept 7 — Nation-wide economic slowdown has driven the local industry into one of the worst crises in recent memory. Layoffs, shutdowns, production cutbacks, credit squeeze, piling up of stocks and lack of demand for finished goods have become the order of the day in this megacity of 2.5 million. The city is rife with rumours of one business house or the other going bust or selling its assets to meet its financial obligations. At least one business house has had to put in an advertisement in newspapers to deny reports that it was on sale because of financial stringency. Mr P.D. Sharma, President of the Apex Chamber of Commerce and Industry, says that there has been a sharp decline in credit from banks and financial institutions for new projects or expansion of the existing ones. The demand for new power connections by the industry has gone down.He estimates that about 5 per cent of the Ludhiana industry, including hosiery units, light engineering manufacturing industries and induction furnaces and steel re-rolling mills have closed down. Reduction in shifts and layoffs by others have rendered thousands unemployed.Payments for goods supplied by the industry are also held up. Mr Harish Khanna, president of the Ludhiana Small Scale Manufacturers Association, estimates that more than Rs 100 crore is being held back by exporters of Delhi alone for goods procured from the Ludhiana industry. Manufacturers of raw materials and other industrial inputs have cut down on supplies while private finance companies have suddenly become tight-fisted due to fears of insolvency and bankruptcy in manufacturers.There are nearly 3,000 hosiery units here employing about two lakh people. The annual turnover is in the region of Rs 800 crore. These were already facing a difficult time after its principal consumer, the USSR, collapsed six years ago. They have not been able to find an alternative export market so far. The emergence of Tripur in the South as a parallel hosiery complex has added to its woes. The steel industry is the worst affected. According to Mr Manjit Singh, Secretary of the Ludhiana Management Association, the cost of manufacturing has been rising steeply because of the rising exchange rate of the US dollar. Most of the scrap used by the steel industry is imported.On the one hand, there is a slump in demand and on the other, the cost of production has risen. Therefore, there is no alternative but to cut back on production. “I have laid off about 100 workers in the past few weeks”, he says. There are 125 steel producing units in Punjab with a major concentration in Ludhiana and Mandi Gobindgarh. There are another 400 steel rolling mills in Ludhiana and Mandi Gobindgarh. They together employ about three lakh persons and have a total annual turnover of about Rs 1,500 crore. All are in deep financial trouble. Many have closed down, while others have reduced shifts.It is the same story as regards the light engineering industry, including cycle and handtool manufacturing units. These units, numbering about 1,500, are estimated to employ about one and a half lakh persons. Mr Sunil Kumar Jain, President of the United Plastic Manufacturers Association, says that the recent hike in the power tariff and octroi could not have come at a worst time. It makes a nonsense of the
tall government claims of promoting industry in the
state. The government must come out with a package of
concessions and relief for the industry. |
Sony fights piracy in USA NEW YORK, Sept 7 — Troubled by soundtrack piracy in the USA from popular Hindi films, Sony Music has hit back at the pirates with the worldwide launch of the score of Kuchh Kuchh Hota Hai (KKHH). Described as the biggest Indian music launch ever in the USA with 50,000 units in marketplace on day one, the tapes and compact discs (CDs) use latest anti-piracy technology.Packaging is the key in the fight against piracy, said Don Lindgren, Sony’s Associate Director of Cultural Marketing. So Sony is releasing KKHH in the Digipack CD format, a first for India. Instead of a clear plastic jewel case, the packaging is glossy cardboard with a compact pocket. The cassette version, too is piracy-protected, with Sony’s name printed on the tape leader and the cassette and impregnated within a small strip of tape around the cassette’s cellophone wrapping. At Rs 295 per CD and Rs 45 per cassette (Rs 75 for a limited edition premium casettee with enclosed postcards, KKHH is a bit more expensive than the average Bollywood release. But the price hike is a necessary evil, Lingren said. “We’re making a concerted effort worldwide to bring Indian pricing up. We feel that Indian pricing is incorrectly adjusted to compete with piracy,” he said.Once confined to the east coast in the USA, piracy is now spreading to the West. The music
score from another popular Bollywood film, “Dil
Se,’ is favourite among the pirates in California.
“The sound is inferior,” according to Hitesh
Dhupelia, who together with his brother Anil owns the
Berkeley-based Shrimati’s store, a major distributor
for northern California. (IANS) |
Reliance scheme for shareholders MUMBAI, Sept 7 (PTI) — Reliance Industries has offered to buy “odd lot” shares from its shareholders at a value of Rs 200 each. The scheme, formulated to help small shareholders gain liquidity would be administered through a trust formed by the company. Under the
scheme, any shareholder can offer his odd lot shares to
the “Rel odd lot shares trust” and the trust
would give the full amount without charging any
administration or service fee from the shareholder, a Rel
statement said here today. Each share of the company has
a face value of Rs 10. |
VSNL to offer uplinking facilities NEW DELHI, Sept 7 (PTI) — India’s overseas carrier Videsh Sanchar Nigam Limited (VSNL) will offer uplinking facilities to Indian television channels with less than 20 per cent foreign equity. Pending announcement of the government policy on uplinking, VSNL has made arrangements with major Indian private channels including Sun and Eenadu for providing uplinking facilities, company sources said. The company has drawn a strategy to offer uplinking facilities to all Indian companies whose foreign equity holding is within the prescribed limits, sources said.The company has already erected dedicated and shared earth stations in Chennai and Delhi for uplinking facilities, while digital uplinking and fly-away terminals would also be provided to give maximum flexibility to Indian broadcasters planning uplink from India. VSNL was in a position to meet any stringent requirement of Indian broadcasters for uplinking, sources said, pointing out that the company already provides transponder leasing services on satellites of Intelsat, in which VSNL is a share holder. So far 13 transponder
leases on Intelsat satellites have been arranged by VSNL
for Indian channels, while some more applications are
pending before it. |
Nadar denies selling stake in NIIT NEW DELHI, Sept 7 (PTI) — The chairman and a founder promoter of the NIIT Limited, Shiv Nadar, today denied that he was selling his holdings in the company. “Neither I nor any of my investment companies are selling any holdings in NIIT. I am not exiting from NIIT and I stand committed to NIIT exactly the same way as I have been since its inception in 1982,” Nadar told the Board of Directors here yesterday. The Board of Directors also gave the go ahead for the company’s plan to acquire a US-based software projects services company as a strategy for its future growth, a company release said here today. The meeting approved the
process of search and short listing from various
investment bankers for the purpose. The NIIT had reported
Rs 496 crore profit for the financial year ended June 30,
1998 registering a growth of over 67 per cent over the
corresponding period last year. |
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MUMBAI, Sept 7 (PTI)
— A fire broke out in the office of Essar group in
the seven-storeyed “Express building” in South
Mumbai early today. However, nobody was injured, fire
brigade sources said. The fire on the fourth floor of the
building gutted airconditioning machines, office records,
equipment and computers at around 10 am, sources said.
Five water tankers and four fire engines put out the
blaze by 2.40 pm. The cause of the fire has not yet been
ascertained. |
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Hegde leaves for
Colombo today Sukhbir Badal to
visit Japan Jethmalani leaves
for Israel |
General Motors India today launched the diesel version of Opel Astra with a Turbo-powered diesel engine in Bangalore on Monday. Managing Director, Richard C. Swando said the German engineered Opel Astra TD came with a 1.7 litre Turbo diesel engine. The Turbocharger operates at the maximum boost rate of 0.7 bar and the power generated is delivered smoothly and silently to and across all gear shifts. The Astra TD is designed to provide higher fuel economy. The super noise insulation incorporated in the car ensures low sound and vibrations. The price difference between the petrol and diesel versions is just Rs 85,000. The company hopes to sell 250 to 300 cars a month. The car is offered with a two-year warranty. — PTI Daewoo trucks The first cargo version will be rolled out on the Indian roads by 1999-end. This will be followed by a model each in the lower and higher tonnage categories, says Senior General Manager of DMIL O.P. Tiwari. “It is our business strategy to first come out with a model in the medium category and then spread our wings to both directions. We had followed it with the cars by launching a mid-size car ‘Cielo’ and now we are coming out with a small car ‘Matiz’ and a luxury one as well. Similarly, in the commercial load carriers, we will first come with a six-tonner and then go to the higher and lower ends of the segments,’’ he adds.The company is also planning to introduce several special purpose vehicles. “We are looking at drumpers, tippers and police vehicles says Mr Tiwari. — UNI Mint pricing Keeping a large price gap is a deliberate marketing strategy on the part of most of the car manufacturers so that the diesel model does not eat into the petrol market.“Though the exact price is yet to be fixed, we would be looking at a price gap of around Rs 40,000 to Rs 50,000,” say Telco sources. The company intends to roll out a standard and luxury version of the two engine variants. Besides, it is also mulling over the idea of launching an automatic transmission version. — UNI Mercedes-Benz In India Mercedes-Benz produced the E class cars in petrol (E-200 and E-230) and diesel (E-250 D) versions. Mercedes-Benz India is a joint venture between Daimler-Benz AG and Telco. — UNI Mahindra Ford MUL meeting Being held close on the heels of the August 26 board meet in Japan, tomorrow’s meeting is expected to give final shape to the company’s already announced decision to introduce a new model. The annual accounts of the
Rs 8400 crore car major will be passed at the AGM, to be
attended by the share holders of MUL—the Government
of India and the Suzuki Motor Corporation of Japan. —
PTI |
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| Designer wears CHANDIGARH, Sept 7 (TNS) — Babi’s Designer Wear, a local boutique, unveiled designer wears for men and women by Gitanjali Kashyap, J.J. Valaya, Ashish Soni and Rina Dhaka, at a private show here yesterday. Models sashayed down the dancing floor of local disco displaying a range of traditional formals which distinctly bore each designers’ speciality right from Valaya’s rich embroidery work, Geetanjali’s hand-painting lehngas, Rina’s lace and zari work, to Ashish Soni’s designs in earthen brown base of silk and crepe. Osaka fair PNB branch Theft Garment Forex rates Silver shines |
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