B U S I N E S S

Tata Sons exits banking foray bid for now; 25 left in fray
New Delhi, November 27
Tata Sons has withdrawn its application for setting up a bank, saying its current financial services model best supports the needs of the group's domestic and overseas businesses. "The company (Tata Sons) has indicated that its current financial services operating model best supports the needs of the Tata Group's domestic and overseas strategy, and provides adequate operating flexibility to its companies, while securing the interests of the group's diverse stakeholder base," RBI said.

Logjam continues: Talks between UP govt, sugar mills fail
Lucknow, November 27
Crucial talks to break logjam over cane crushing operations in Uttar Pradesh have failed, with sugar mill owners refusing to run their plants at current high sugarcane prices. The Uttar Pradesh Government held long parleys with 99 private sugar mill owners for the second day today to resolve the deadlock that has threatened to affect sugar production in the current year, but talks failed to break the impasse, sources privy to the negotiations said.

India Inc backs govt’s stance on food subsidy at WTO
New Delhi, November 27
Industry has urged Trade Ministers to conclude a trade deal in the Bali ministerial meeting of the World Trade Organisation (WTO). Industry chamber, Ficci said Trade Ministers should step up engagement so that it is possible to have a trade deal in the Bali Ministerial meet.

Maruti recalls 1,492 cars
New Delhi, November 27
Maruti Suzuki India (MSI) today said it will recall 1,492 units of Ertiga, Swift, Dzire and A-Star models produced in October this year to rectify a possible problem with steering column. The company said it will inspect the steering column for 1,492 vehicles — Ertiga: 306 units, Swift: 592 units, Dzire: 581 units and A-Star: 13 units manufactured between October 19, 2013, and October 26, 2013. "If the steering column is found defective, the company will replace the steering column free of cost," it said. The new steering column has been despatched to dealer workshops. The dealers will contact owners of all vehicles in the above range. — PTI

ArcelorMittal, Nippon to buy US steel plant
Tokyo, November 27
The world's two biggest steelmakers, Nippon Steel & Sumitomo Metal and ArcelorMittal, are close to a $ 2 billion deal to buy a US factory from Germany's ThyssenKrupp, a report said Wednesday. Nippon Steel of Japan and Luxembourg-based ArcelorMittal have reached a basic accord with ThyssenKrupp on the deal worth nearly 200 billion yen ($1.97 billion), the Nikkei economic daily said, without naming its sources. Nippon declined comment on the possible purchase, which could be its largest ever outside Japan. — AFP

Tata Sons exits banking foray bid for now; 25 left in fray
Tribune News Service & PTI

New Delhi, November 27
Tata Sons has withdrawn its application for setting up a bank, saying its current financial services model best supports the needs of the group's domestic and overseas businesses. "The company (Tata Sons) has indicated that its current financial services operating model best supports the needs of the Tata Group's domestic and overseas strategy, and provides adequate operating flexibility to its companies, while securing the interests of the group's diverse stakeholder base," RBI said.

The Reserve Bank has accepted the withdrawal of the application, it added.

The withdrawal of the Tatas' application for the much sought after bank licence leaves 25 players in the fray, including big names in the corporate and financial services sector. A Chandigarh-based company, KC Land and Finance has also applied for a bank licence. An entity connected to the Videocon group had also withdrawn its application.

The RBI had, on July 1 placed on its website a list of 26 applicants for new bank licences in the private sector and had intimated the change in the names of applications later on September 6, 2013.

In the past 20 years, the RBI had given licence to 12 banks in the private sector in two phases. Ten banks were given licences on the basis of guidelines issued in January 1993.

The Tata Group comprises over 1,000 companies engaged in multiple sectors and geographies, with a significant presence outside India. Tata Sons said it had reached this conclusion on a detailed evaluation of the guidelines for new private banks licences.

"The company shall continue to monitor developments in this space with great interest and looks forward to participating in the banking sector at an appropriate time," it said.

Tata Sons remains committed to financial inclusion and believes that the group's existing financial services footprint uniquely positions it to provide technology excellence and access to India's hinterland, it said.

The applicants for bank licences include Aditya Birla Nuvo, Bajaj Finserv, Department of Posts, Edelweiss, IDFC, IFCI, Indiabulls Housing Finance, India Infoline, J M Financial, LIC Housing, L&T Finance, Magma Fincorp, Muthoot Finance, Reliance Capital, Religare Enterprises, Shriram Capital, SREI Infrastructure Finance, Tourism Finance Corporation of India, among others.

Chandigarh-based firm also in fray

• The Reserve Bank of India has accepted the application of Tata Sons for withdrawing from banking foray
• Earlier, an entity connected to Videocon group had also withdrawn its application
• A Chandigarh-based company, KC Land and Finance has also applied for a bank licence
• In the past 20 years, the RBI has given licence to 12 banks in the private sector in two phases
• Tata Group comprises over 1,000 companies engaged in multiple sectors and geographies, with a significant presence outside India

Logjam continues: Talks between UP govt, sugar mills fail

Lucknow, November 27
Crucial talks to break logjam over cane crushing operations in Uttar Pradesh have failed, with sugar mill owners refusing to run their plants at current high sugarcane prices.

The Uttar Pradesh Government held long parleys with 99 private sugar mill owners for the second day today to resolve the deadlock that has threatened to affect sugar production in the current year, but talks failed to break the impasse, sources privy to the negotiations said.

The deadlock not just means that sugar production will be impacted severely, farmers too will not be paid for the standing cane crop.

Mills owners, who say they can’t pay more than Rs 225 per quintal to farmers as against the state advised price (SAP) of Rs 280 a quintal announced by the state government, offered the state government to run their mills.

Sources said the mills owners have informed the government they are already running huge cash losses and have to pay Rs 2,400 crore to farmers for last year.

Banks have refused to lend money for working capital needs and so they can’t afford any further losses, they claimed.

The state government, however, is not in favour of lowering the sugarcane price which are at last year's level.

Meanwhile, the Central Government is working on a financial package that includes interest-free loans to bailout the millers.

"The talks lasting for one and a half hours today with Chief Secretary Javed Usmani and private millers over these issues, besides payment of cane arrears yielded no results," a representative of a private miller said.

Though the Chief Secretary asked millers to start crushing but no solution to their problems could be worked out, he added.

Most private sugar mills have already declared shut down of operations till the government works out a proper plan to overcome their losses.

Uttar Pradesh is the second largest sugar producing state in the country. It produces about 7.5 million tonnes. Almost 80% sugarcane produced by around four million growers are consumed by private mills. — PTI

High cane prices

India Inc backs govt’s stance on food subsidy at WTO
Tribune News Service

New Delhi, November 27
Industry has urged Trade Ministers to conclude a trade deal in the Bali ministerial meeting of the World Trade Organisation (WTO). Industry chamber, Ficci said Trade Ministers should step up engagement so that it is possible to have a trade deal in the Bali Ministerial meet.

“This would be critical in the interest of multilateralism and towards taking the Doha development agenda forward", Ficci president Naina Lal Kidwai said.

Commenting on WTO Director General's report after the last General Council Meeting held on Tuesday, Kidwai emphasised the need for continuing the efforts to close the remaining gaps so that a Bali package could become a reality.

"It is indeed important that we do not lose this opportunity to break the stalemate in Doha talks and that we are successful in building on the progress achieved so far in the areas of trade facilitation and agriculture, including public stockholding for food security purposes and a range of development issues", Ficci president pointed out. Estimates suggest that a trade facilitation deal could result in nearly $1 billion rise in worldwide GDP (of which more than half would accrue to developing countries) and create around 21 million new jobs.

Assocham president Rana Kapoor said while an agreement on trade facilitation will surely make life easier for the industry, the Indian industry would not like the government to make any compromises on food subsidies for the sake of narrow gains.