India can’t meet deficit target: WEF
Tribune News Service, PTI

NEW DELHI, Nov 30 — India is unlikely to meet the budgeted fiscal deficit target of 5.6 per cent during the current fiscal year, the World Economic Forum (WEF) has said.

“The present government had presented a budget based on 5.6 per cent deficit. But nobody expects this target to be met. The forecasts are now oscillating between 6 to 7 per cent”, the Managing Director of World Economic Forum (WEF) Mr Claude Smadia said while delivering an address at the India Economic Summit here.

Painting a gloomy picture of the current state of the Indian economy, Mr Smadia said that part of the present difficulties are due to the present slowdown of activity “as all calculations were made on the optimistic assumption of a 6.5 per cent growth which will not materialise”.

Elaborating on the figures of the economic parameters, Mr Smadia said that in every domain results will fall short of expectations.

Agricultural output is expected to grow by about 3 per cent against initial expectations of 4 to 5 per cent.It is also extremely unlikely that the target of 6 per cent of industrial growth set for this fiscal in the budget will be met.

The sagging industrial output is partly a reflection of the poor performance in the export sector since export represent 40 per cent of Indian industrial production.For the first part of the current fiscal, exports have fallen by 3.28 per cent compared to the same period in 1997.

Former Prime Minster Inder Kumar Gujral today said that the South Asian region should expedite the process of moving towards a free trade regime to utilise their surpluses optimally and benefit collectively.

Despite differences between India and Pakistan on the political front, both the countries have started trading with each other and this is a welcome development, he said.

He cited the recent negotiations between the neighbours on the power issue where Pakistan was willing to export surplus electricity to India.

The first phase of the 2450-MW Dabhol project in Maharashtra would start operation next month, State Chief Minister Manohar Joshi said today.

Mr Joshi said Enron would generate around 700 MW of power in the first phase.

Besides, power purchase agreement has already been signed with Ispat India and Reliance groups’ for their projects in Bhadrawati and Patalganga respectively.

Enron, Reliance and Ispat India would generate around 4,000 MW of power, he said.

Russia to use Re funds to buy
goods from India
From Arun Mohanty

MOSCOW, Nov 30 — Russia has decided to discontinue the practice of auctioning the entire annual amount of rupee funds generated from Indian debt repayment and instead buy essential items like medicines and food from New Delhi.

“Only 50 per cent of the rupee funds would be auctioned as in the past and the remaining 50 per cent would be allocated through the state budget to meet the most serious requirements of the people and develop the production sector in Russia,” Yuri Maslyukov, senior Russian Deputy Prime Minister, told IANS at the conclusion of the fifth session of the Indo-Russian joint commission here.

The two sides are reported to have expressed concern that the annual debt repayment amount of Rs. 300 billion earmarked for use by the Russian government in course of a year has not been fully utilised. This has led to accumulation of unused funds to the tune of Rs. 270 billion in the past four years.

The Indians have reportedly proposed to increase the amount of annual debt repayment from Rs. 300 billion to Rs. 500 billion. Though no concrete decision on the issue was taken at the Moscow session, Russia is believed to have committed to look into the proposal seriously.

The joint commission has noted that the Exim Bank of India would discuss with Vnesheconombank the proposal for a possible line of credit of $50 million. It has advised the Exim Bank and the Roseximbank to finalise terms and conditions for the $10 million line of credit earlier offered by the former.

Finance Minister Yashwant Sinha told IANS that the commission has welcomed the growing cooperation between the financial institutions of the two countries. He said Russia’s leading insurance company Ingosstrakh entering into agreements with the General Insurance Corporation (GIC) and another Indian insurance firm would provide economic relations greater stability.

Sinha also noted that the long-term cooperation agreement would provide a tremendous boost to bilateral ties in trade, industry, finance, science and technology sectors in the 2000-2010 period. The two sides have set targets to double bilateral trade turnover by the year 2000 and increase it by four times by 2010. — IANS.

Govt identifies 9 PSUs for closure

NEW DELHI, Nov 30 (PTI) — Government has identified nine public sector undertakings (PSUs), which are terminally sick, to be shut down, the Rajya Sabha was informed today.

Minister of State for Industry Sukbir Singh Badal said in a written reply that these nine PSUs under the Department of Heavy Industry have been recommended for closure by the Board for Industrial and Financial Reconstruction (BIFR) or the Disinvesment Commission at one stage or other.

The nine PSUs are National Instruments, Rehabilitation Industries Corporation, Bharat Opthalmic Glass, Weighbird India, National Bicycle Corp of India, Cycle Corp of India, Mining & Allied Machinery Corp, Tannery & Footwear Corp and Bharat Process & Mechanical Engineering, he said.

The government has decided to offer voluntary retirement scheme (VRS) benefits to employees of PSUs which are being closed down.

No decision yet on next SBI Chairman

MUMBAI, Nov 30 (PTI) — SBI Chairman M.S. Verma retired today even as the Central Government is yet to decide on a successor to head the country’s premier commercial bank.

Mr Verma handed over charge to Managing Director M.P. Radhakrishnan, who retires on January 31, 1999 along with Managing Director P.K. Bhattacharya, a SBI spokesman said.

Mr Verma rose from the ranks to head the bank and his long career in the SBI ended amidst speculation that he would get an extension.

The bank’s another Managing Director B.M. Bhide also retired today on superannuating.

Deputy Managing Director G.G. Vaidya, who was earlier tipped to be appointed Chairman of Nabard, is expected to be promoted SBI Managing Director, SBI sources said.

Vaidya and V. Janakiraman, a Deputy Managing Director and Chief Credit Officer, were in the race for the top position in the SBI. The other deputy Managing Directors are Y. Radhakrishna (Corporate Development) and D.P. Roy (International Banking).

SBI sources feel the government may wait for superannuation of M.P. Radhakrishnan and Bhattacharya before announcing its choice of the SBI Chairman.

100 pc foreign equity in airports likely
Tribune News Service

NEW DELHI, Nov 30 — An enabling framework for 100 per cent foreign equity participation in select five to six international airports will be finalised soon the Secretary in Prime Minister’s Office (PMO), Mr N.K. Singh, said here today.

Speaking to newspersons on the sidelines of the inaugural session of the 29th joint meeting of the India-Japan Business Cooperation Committee organised jointly by FICCI and Assocham here, Mr Singh said that the government through its various task forces set up for the infrastructure sector is looking into TRAI, evolving an internationally comparable telecom policy, new cellular policy and corporatisation of DoT.

Mr Singh told the 100 Japanese executives present at the meeting that they should not get carried away by political developments.The economic reform process in Indian, he said, is continuous and would gain momentum.

Calling for Indo-Japanese cooperation in evolving a global financial architecture, Mr Singh said that the Japanese consortia also should bid for expressways and other infrastructural projects which would be unveiled shortly.

Economy needs overhaul, not bailout

PAKISTAN’S business community has warned the government that unless it made serious efforts to overhaul the national economy, the $5.5 billion IMF bailout package would offer only temporary relief.

A survey report said the business community considered the package “a mere breather and not the prescription for the complete cure of country’s ailing economy”, NNI news agency said.

Fazal-ur-Rehman Dittu, President of the Federation of Pakistan Chambers of Commerce and Industry, told the local PPI news agency that the deal would help in improving foreign exchange reserves although a major chunk of package would be paid for debt servicing.

The Karachi Chamber of Commerce and Industry, while welcoming the deal, has advised the government that its plan to curtail budget deficit from 5.4 per cent to 4.3 per cent of GDP should not be at the cost of development expenditure.

Humayun Elahi, Chairman, All Pakistan Textile Mills Association, said the IMF-Pakistan agreement would provide stability to the stock market and remove the atmosphere of depression. — IANS

Shrinking jobs

Lack of job opportunities in Gulf countries may affect foreign exchange remittances to Pakistan in the enter future.

The Nawaz Sharif government had set a target of 200,000 workers to be sent abroad, especially, Gulf countries, during the current year, but so far only 100,000 workers had managed to secure employment.

The failure to meet the target is because of the reduction in job opportunities in the Arab world, including Saudi Arabia, Kuwait and Qatar. — ANI

Power for India

Pakistan will initially sell 500 MW of power to India and a feasibility study will be conducted to establish inter-connection facilities.

A seven member delegation from India led by Pradip Baijal, Special Secretary, Power Ministry, last week discussed the possibility of Pakistan selling power to India.

In the course of discussion, the Pakistan delegation indicated availability of surplus power up to 2000 MW which could be exported to India.

However, the transfer of such huge quantum of power would require detailed studies and setting up of large transmission systems, it was felt. — PTI

Sugar export

Pakistan will export 500,000 tonnes of sugar from the surplus estimated at more than one million tonnes this year.

Pakistan, harvesting a bumper crop of more than 53 million tonnes of sugarcane this year, is expected to produce 3.9 million tonnes of sugar — up by 25 per cent over the production last year.

The country has exported 550,000 tonnes of sugar to India, Canada, the UAE and some African and Gulf countries.

There is still a surplus of more than one million tonnes, out of which the country will export 500,000 tonnes, industry sources here said. — AFP

FII buying lifts sensex

MUMBAI, Nov 30 (PTI) — Equities recovered their initial losses and even posted smart gains lifting the sensex by over 27 points on the stock market today following late purchases by foreign funds and financial institutions leading to short covering by operators.

The prices suffered a setback at the initial stages due to fears of political instability at the Centre after the Congress wrested power from the BJP in two crucial states like, Delhi and Rajasthan in the Assembly elections.

Operators were so disappointed that they even discounted Prime Minister Atal Behari Vajpayee’s assurance that the post-election scenario would have to fundamental impact on the process of economic reforms in the country.

However, speculation of a Cabinet reshuffle to replace the Union Finance Minister, Yashwant Sinha, coupled with fresh support by foreign institutional investors (FIIs) inspired nervous operators to cover their short positions.

The BSE sensitive index opened lower at 2771.69 and dipped to the intra-day low of 2741.70 before recovering to close at 2810.66 as against last Friday’s close of 2783.10, netting a gain of 27.56 points. The BSE-100 index improved by 11.77 points to 1254.10 from previous close of 1242.33.

FIIs were net buyers in ITC, Telco and few other scrips while local institutions led by Unit Trust of India picked up shares of Telco, BSES, L&T, SBI, Satyam Computer, MTNL, Hind Lever and ITC, dealers said.

They attributed fresh buying to shortcovering on the National Stock Exchange and said a technical correction was also overdue.

The BSE-200 and the Dollex were quoted marginally up at 291.54 and 113.86 compared with previous close of 289.03 and 113.17 respectively.

Bajaj Auto puts off plan on buyback

NEW DELHI, Nov 30 (PTI) — Two-wheeler Bajaj Auto today said it was willing to go for buyback of its shares but a certain clause in buyback rules was deterring the company from going ahead.

“The current rules prohibit buyback through negotiated deals. This is a retrograde step,” Chairman of Bajaj Auto, Rahul Bajaj, whose company was among the first few companies to get shareholders nod for buyback, told PTI.

SEBI had excluded negotiated deals by which transactions are entered between two parties (the company and the private shareholders in this case) at a pre-negotiated price, as it feared the clause could be manipulated by promoters to their advantage.

Bajaj, however, countered such an argument and suggested that SEBI could have inserted a clause that allowed carrying out these sort of deals at below market price or the ruling prices so that other shareholders did not feel cheated.

“By allowing negotiated deals at below market price of the ruling prices, price manipulation can be eliminated,” he said, adding that market price could be calculated on the average of six months traded price of the company at stock markets.

“We have the shareholders nod for buyback. But currently we don’t have any plans for buyback,” he said.

The company recorded a net sales of Rs 2643.22 crore and a net profit of Rs 464.15 crore during the fiscal 1997-98.

Hind Lever achieves Y2K compliance

MUMBAI, Nov 30 (PTI) — Hindustan Lever Ltd (HLL) has achieved year 2000 (Y2K) compliance in all its internal operations, having met its self-imposed deadline of October 31, 1998.

The two-year operation involved checking information technology (I-T) systems, factory/process systems, telecom systems, networks at 67 factories, four sales branches, 121 depots, research centres and all offices across 350 locations, with a total expenditure of Rs 6 crore, a company release said here today.

The Y2K strategy was devised on the basis of a detailed “gap analysis” of all systems in use across different centres and rather than repair the non-compliant solutions. The company decided to accelerate the pace of its I-T implementation so that the entire organisation would be at the same level of sophistication.

GAIL net profit up

MUMBAI, Nov 30 (PTI) — The net profit of Gas Authority of India Limited (GAIL), one of the “Navratna” enterprises, has shot up to Rs 1020.31 crore during the year ended March 31, 1998, as compared to Rs 619.55 crore last year.

The GAIL also registered an increase in the turnover at Rs 5736.13 crore during the year ended March 31, 1998, as against Rs 4541.03 crore in the previous year.

The company announced an increased dividend of 20 per cent for the year as against 15 per cent in the previous year. The earnings per share was up at Rs 12.07 as against Rs 7.33 in the previous year.

Gas transmission and distribution forms the bulk of GAIL’s business followed by gas processing for liquefied petroleum gas (LPG) production, C.R. Prasad, Chairman and Managing Director of GAIL told reporters at USAR recently.

The government has proposed to disinvest 25 per cent of its total 96.4 per cent shares in GAIL by way of Global Depository Receipts (GDR) and domestic equity issues which are yet to be finalised.

MTNL outlines future services

MUMBAI, Nov 30 (PTI) — Chairman and Managing Director of Mahanagar Telephone Nigam Ltd (MTNL), S. Rajagopalan, today outlined a time-schedule for various value-added services to be introduced by the year 2000.

MTNL will provide cellular services and intelligent network by June 1999, smartcard services by March 31, 1999, internet services by January 26, 1999, total digitalisation of phone services in Mumbai by the year end, prepaid plastic cards within the next 15 days and a new telephone directory for the city by March next, he said.

Addressing the Indian Merchants’ Chamber here today, Rajagopalan said the new year would bring in the facility of allowing a subscriber to pay his telephone bill from anywhere in the city and added that by the end of this year, wrong telephone disconnections would also come to an end.

The company can no longer afford to depend on basic services and must position itself to derive income from various streams, he said.

“Voice telephony accounts for 90 per cent of our revenues today, whereas, internationally it is the reverse. The company expects a turnover of Rs 5000 crore for the year “ending march 31, 1999”, the MTNL CMD said.

Investments during the year would exceed Rs 2,000 crore, Modernising costs for each city have been targeted at around Rs 900 crore and the wireless in local loop (WILL) would amount to Rs 100 crore.

Come monsoon 1999 and no telephone would stay out of order for longer than 48 hours, Rajagopalan assured while banking on the “WILL” system that would be in place by then.

A televoting survey conducted by the company revealed that customers were not happy and dreaded having to lodge a complaint or shift their telephone.

Radio paging services would be modernised and its coverage would be expanded to cover the whole of Mumbai, Rajagopalan said.

More bill collection centres and mobile bill collection vans are also on the anvil, he added.

Customers with bills that do not exceed the basic rental charges would be billed quarterly thereby saving on resources as well as making it more convenient for the subscriber.

MTNL would soon launch its own website which would allow payment of bills as well as tele-shopping and electronic commerce.

“We wish to be a one-stop-shop that is not restricted to voice or data telephony”, the MTNL chief said.

Asked to comment on the internet charges, he said “they would be affordable”. He, however, hinted a price below Rs 56 per hour which is the present cost for internet services.

SEBI awaits govt reply

NEW DELHI 30 (PTI) — SEBI Chairman D.R. Mehta today demanded amendment to the buyback ordinance to reduce the two-year ban on public issues after a buyback to help growth-oriented companies expand business.

SEBI has already written a letter to the government to this effect and “we are waiting for a response to the letter,” he told delegates at the World Economic Forum here.

Another relaxation sought by SEBI pertains to the mandatory requirement in the buyback Ordinance that only companies having 2:1 debt equity ratio could go for buyback.

Birla Global net drops

MUMBAI, Nov 30 (PTI) — Birla Global Finance Ltd (BGFL) has registered a drop in its net profits from Rs 831.36 lakh to Rs 632.75 lakh for the year ended September 30, 1998 on a marginally higher gross revenue of Rs 92.22 crore compared to Rs 94.50 crore in the previous year. The recently restructured finance arm of the Aditya Birla group has recommended a lower dividend of 18 per cent as against 20 per cent last year. The total outgo on account of equity and preference dividend including dividend tax would amount to Rs 582.11 lakh.

Deutsche-Bankers deal

FRANKFURT, Nov 30 (Reuters) — Deutsche Bank AG has said today that it had sealed a takeover of the Bankers Trust.

The supervisory boards of both banks yesterday approved a “definitive agreement” under which Deutsche will acquire all outstanding shares of the common stock of Bankers Trust.

Deutsche, Germany’s largest bank, said the acquisition would establish a “global platform for profitable growth.”

‘191 MPs defaulters’

MUMBAI, Nov 30 (PTI) — As many as 191 sitting MPs of have defaulted in paying Mahanagar Telephone Nigam Ltd (MTNL) their dues to the tune of Rs 6.11 crore, the Mumbai High Court was informed today. In response to a petition filed by eminent lawyer MP Vashi, MTNL affirmed on affidavit that it had to recover this amount from 17 sitting Rajya Sabha MPs and 174 Lok Sabha MPs, who got re-elected to the 12th Lok Sabha. Besides, MTNL claimed that an amount of Rs 14.15 crore was outstanding from MPs and former MPs as on September 28 this year.

Canara Bank
Tribune News Service
CHANDIGARH, Nov 30 — Canara Bank will organise a “musical product display” programme by women entrepreneurs on December 3 at Tagore Theatre here. No charges are to be paid by women entrepreneurs intending to participate in the show.

Business centre
Tribune News Service
CHANDIGARH, Nov 30 — The Managing Director of CITCO, Mr Satish Chander, inaugurated a high-tech business centre at Hotel Shivalikview here today. Set up by a group of non-resident software engineers settled in England and Switzerland, the centre provides state-of-the-art facilities like e-mail, Internet and conferencing facilities.

Price index
SHIMLA, Nov 30 (UNI) — The All-India consumer price index for industrial workers on base 1982-100 for the month of October has increased by 13 points to stand at 433, according to the Labour Bureau here today.

Forex reserves
MUMBAI, Nov 30 (PTI) — India’s foreign currency assets (FCA) increased by US $ 87 million to $ 26,533 million during the week ended November 20, 1998. The increase in FCA has followed reduction aggregating $ 199 million during the three preceding weeks.

Forex rates
MUMBAI, Nov 30 (PTI) — The following were interbank forex and RBI rates (in rupees per unit): US $ Rs 42.57/58

Sterling £ Rs 70.32/34

Deustsche Mark Rs 24.96/98

Jap Yen (100) Rs 34.49/51.

The RBI reference rate was Rs 42.63.

Gold recovers
NEW DELHI, Nov 30 (PTI) — Both the precious metals, silver and gold, recovered on the bullion market today on revival of buying by local parties and gained moderate ground. The quotations: Silver .999 (ready) 7415, delivery 7450, coins buyer 10,500 and seller 10,600. Standard gold 4375, ornaments 4225 and sovereign 3750.

Commodity
From Our Correspondent
CHANDIGARH, Nov 30 — Wheat 635, dara 635 to 640, superior 650, maize 560 to 590, til 2400 to 2600, sarson 1800 to 2000, taramira 1700 to 1800, paddy (103) 455 to 475, PR (106) 475 to 485, rice basmati 2700 to 5000, parmal 825 to 1050, sella 850 to 1050, maida (90 kg per bag) 690, suji 690, atta 650, urd (per quintal) 2000 to 2300, urddal 2000 to 2400, moong dal 2200 to 2600, moongduli 2300 to 2800, masoor 2100 to 2400, malkamasoor 2100 to 2500, kablichanna 2500 to 3500, kalachanna 1500 to 1700, dalchanna 1650 to 1750, arhar 2500 to 4000, rajmahchittra 2500 to 3500. Sugar: M-grade 1475 to 1515, S-grade 1440 to 1475, khandsari 1300 to 1450, gurkhurpa 800 to 815, gurperi 850 to 875 shakkar 950 to 1000, Oils: Sarson (per quintal) 5800, soyabean (per tin 15 litres) 600 to 700, surajmukhi 600 to 730, groundnut 800 to 900, cottonseed 650 to 700.