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| Friday, May 26, 2000, Chandigarh, India  
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Privatise power, control deficit, WB tells India Banks in Punjab flout RBI guidelines
RBI imposes 50 per cent interest surcharge Website on engineering college launched
Punjab to set up dairy board and fund |
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Bajaj Auto, Hero Honda sales rise Zee drops
publishing 
Privatise power, control deficit, WB tells India PARIS, May 25 — The World Bank has urged India to privatise rusting power plants as a crucial step in balancing strained government finances. World Bank Country Director for India Edwin Limm, ending two days of talks in Paris with donor governments and Indian officials, said yesterday selling loss-making power stations would free up money for schools and hospitals. “Reform of the power sector is key to development prospects in India,’’ Limm told Reuters. Limm said no new money was promised at the India Development Forum meeting, the aim of which had been to encourage discussion rather than agree new loans. India’s rising government deficit was undermining efforts to tackle poverty in the country of one billion people where 40 per cent of the world’s poor live, Limm said. India’s fiscal problems were thrown into the spotlight on Saturday, when Indian Prime Minister Atal Behari Vajpayee warned that the country’s finances were under severe stress. The Centre’s fiscal deficit for 1999/2000 is estimated at 5.6 per cent of gross domestic product (GDP), sharply up from 4.5 per cent the previous year. Limm said the World Bank would encourage foreign Companies to invest in Indian electricity, aiming to trim the 2 per cent of GDP the government spends each year on power subsidies. “They (Indian power firms) are so inefficient now, and there’s so much demand that private companies ought to be able to turn the situation around and make it very profitable,” Limm said. The World Bank said it would seek to speed privatisation by extending its move towards working directly with the state authorities who administer the power sector. The Paris meeting was attended by representatives of Andhra Pradesh, Uttar Pradesh and Karnataka, the first time representatives of Indian states have joined national government officials at the India Development Forum. India’s top official at the meeting said the national government was committed to working in tandem with states to tackle bulging deficits. “The problem of fiscal stress in states is right on the top of the agenda of all state governments,’’ said E.A.S. Sarma, Secretary of Economic Affairs at the Indian Finance Ministry. (Reuters) PTI adds: The World Bank said at 5.6 per cent of GDP in 1999-2000, the central government deficit was higher than any of the previous five years and together with the state deficit, resulted in a general government deficit of 9.6 per cent of GDP. This high fiscal deficit was in sharp contrast to strong fundamentals in 1999-2000 with growth being at 5.9 per cent, 12-month inflation remaining at 4 per cent, balance of payment remaining strong with a current account deficit of one per cent of GDP, foreign exchange at an all time high of $ 38 billion equivalent to eight months of imports, it said. “Indeed many now talk of a fiscal crisis and certainly in many states this is what one sees. Revenues are falling, subsidies remain large. Despite progress in some sectors, reform is stuck in some important areas, even when the need for change is obvious,” Limm said. Agreeing with the world bank’s perception, Sarma told reporters from Delhi at a video conference in Paris that the “fiscal deficit problem of both the Centre and states is real and hence the
government is giving topmost priority to tackle it.” |
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Banks in Punjab flout RBI guidelines AMRITSAR, May 25 — Financial institutions are flouting the RBI
flout guidelines by not setting up advisory committees to settle chronic cases of the small scale sector. An RBI circular dated May 27, 1999, stated that “the present system and procedures of settlements in banks for the recovery of non-performing assets (NPAs) were long drawn”. The Punjab Border Districts Industries Association, which has prepared a comprehensive report on the sickness of units, has accused the Punjab Financial Corporation of auctioning units without following any set procedures. The association demands the use of the Financial Act 29 and 30 and the Debt Tribunal should be restricted to the rarest of rare cases. A deputation of the association led by Mr R.L. Bhatia, MP, Mr Lajpat Rai and Mr Shyam Behari Mishra, President of the All-India Beopar Mandal, met the Union Finance Minister, Mr Yashwant Sinha, in Delhi on May 16 and presented him a memorandum listing problems in the settlement of accounts with banks. The Finance Minister had assured the delegation that he would get these issues examined by the Department of Banking. The Punjab Government’s “anti-industry” policies too have compounded their woes. The non-receipt of sanctioned subsidies under the Punjab Industrial Policy 1996 has dried up liquidity. The Industries Secretary, Mr Ramesh Inder Singh, had told a PHDCCI meeting here in June last year that Rs 45 crore had been earmarked for the payment of subsidies and would be disbursed by the end of March, 2000 but no such payment has been made. The promise to give sales or purchase tax exemption to new units as per the industrial policy too has come as a cropper. The sales tax authorities claim that no modalities have been worked out as yet. All this is forcing many border district units to close down. In the districts of Amritsar, Gurdaspur and Ferozepur agro-industries, including the flour and rice mills, have suffered the most. Out of 500-odd rice shellers more than 70 per cent have shut down. Similarly, majority of the 24 flour mills have either closed down or are running at 10 to 20 per cent capacity. The worst hit is perhaps the Goindwal Industrial complex were out of 155 units 82 have shut down while the remaining have gone sick. Also hit the hardest are the foundry and machine tool factories in Batala where the closure ratio is alarming. LUDHIANA (TNS): The Northern Federation of Industrial and Commercial Undertakings President, Mr Kanti Behal, has also alleged that banks are flouting the RBI guidelines. “We are prepared to pay the principal amount with 10 per cent simple interest over a period of two to three years,” Mr Behal said. There are about 10,000 sick small units in the northern region, most of them in Punjab, with liabilities not more than Rs 800 crore. According to Raja Narinder Singh, General Secretary of the federation, the banks are not even prepared to adjust the amount realised by them from the Deposit Insurance Credit Guarantee Corporation. The federation has sought that the RBI guidelines should be extended by one year. A year has been wasted and the scheme has not been implemented. Besides the guidelines should be made transparent and mandatory. |
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BEIJING, May 25 (Reuters) — A relieved China today hailed a “wise” Bill passed by the US House of Representatives granting it permanent normal trade relations, but lashed out at provisions on human rights
monitoring. The Bill lifts two decades of uncertainty over Chinese exports to its biggest trading partner by eliminating an annual review by Congress of China’s trading status. Passage of the bitterly contested legislation that smooths China’s entry to the World Trade Organisation will be a political boost to China’s reformist Premier Zhu Rongji and President Jiang Zemin, who both fought hard for WTO entry in the teeth of opposition from protectionist ministries. US business executives in China also were elated by a Bill that will offer them unprecedented access to a market of 1.3 billion consumers within the WTO. News the bill had passed by a vote of 237 to 197 lifted Chinese stock markets, even though more foreign competition could cause severe pain in the short term by throwing millions of state workers out of job. Washington (AP): The approval came after supporters rejected a last-ditch effort by opponents to send the measure back to committee to add language that would withdraw China’s trade privileges if Beijing launches military action against Taiwan. The 11th-hour amendment was drafted by opponents of normalised trade relations in an effort to pick up the votes of conservative Republicans. But Rep. Tom DeLay, a Republican, took to the floor to urge a ‘no’ vote, arguing the President already has the necessary authority to withdraw China’s trade privileges if Taiwan is invaded. The amendment lost 258-176. At the start of the long day of debate, supporters had defeated an effort by opponents to keep the Bill from being debated yesterday. The measure was approved with the support of 164 Republicans, comfortably over their target of 150, and 73 Democrats. During the daylong debate, supporters said passage of the Bill to end the annual congressional review would be an economic boon that would shower billions of dollars in additional sales on American exporters who could take advantage of the market-opening offers China has made to gain WTO entry. But opponents argued that Congress should not give up the annual congressional review of China’s low-tariff access to American markets provided crucial leverage necessary to keep pressure on China to reform its abysmal record on human rights and religious rights. Meanwhile, President Bill Clinton has praised the passage of the landmark bill by saying that it would boost reform in China. “Today the House of Representatives has taken a historic step towards continued prosperity in America, reform in China and peace in the world,” Clinton said. |
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RBI imposes 50 per cent interest surcharge MUMBAI, May 25 (PTI) — The RBI has decided to impose interest rate surcharge of 50 per cent of the lending rate on import finance as a temporary measure with effect from tomorrow in a bid to check the slide of the rupee. The RBI said it would meet partially or fully the Government debt service payments directly, as considered necessary and also meet fully or partially forex requirements for import of crude oil by the Indian Oil Corporation. Exporters have been advised not to delay repatriation of export proceeds beyond the due date. In order to discourage any delay in realisation of export proceeds, RBI has asked banks to charge 25 per cent on export bills from tomorrow. The interest rate
surcharge would be phased out as early as possible, the RBI said adding at present no further monetary tightening or administrative measures were being contemplated. Essential categories such as export-related imports, bulk exports in respect of crude oil, petroleum products, edible oil, fertilisers and other essential commodities imported through government agencies would be exempted from interest surcharge, the RBI said.
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Website on engineering college launched S.A.S. NAGAR, May 25 — Shaheed Udham Singh College of Engineering & Technology, Tangori, launched its website www.suscet.com today. The site was inaugurated by Mr N.S. Kalsi, Director Technical Education and Industrial Training, Punjab. The website has been designed by Harkirat Singh, Prabhdeep Manocha and Janesh Mehta, students of Computer Science & Engineering branch of this institute. Mr Kalsi lauded the efforts of the students and asked them to keep it up. This site will act as a ready-reckoner of complete information pertaining to college infrastructure, facilities, admission procedures and various courses offered. It will also give an update on the various facets of students’ curricular. |
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Bajaj Auto, Hero Honda sales rise NEW DELHI, May 25 (PTI) — Major two-wheeler players like LML Ltd, Escorts Yamaha and Majestic Auto witnessed a negative growth in sales during the first month of the current fiscal despite an 8.9 per cent growth recorded by the industry. Shift in choice from scooters to motorcycles continued in April also as bike sales grew by an impressive 30.3 per cent in contrast to a negative growth of 1.3 per cent recorded by the scooter segment. Overall two-wheelers sales were recorded at 3.17 lakh units in April 2000-01 as against 2.75 lakh units in the same month last year. Total motorcycles sales touched a level of 1.66 lakh against 1.27 lakh in April 1999, while scooter sales were at 94,547 units, down from 96,367 units a year ago. The first month of the current fiscal was good for companies like Kinetic Motor, Hero Honda, TVS Suzuki and Bajaj Auto as they posted impressive sales growth over the same month last year. Scooter sales of LML Ltd declined by 23.9 per cent to 19,243 units during the reference month against 25,299 units sold in the same month of 1999, according to the data compiled by Society of Indian Automobile Manufacturers (SIAM). Escorts Yamaha Motor Ltd’s motorcycle sales dipped by 32.1 per cent to 13,043 units in the month from 19,219 units in April last year. Sales of Maharashtra Scooters declined by 20.5 per cent to 10,264 units in the first month of the
current fiscal compared to 12,914 units sold in the same period last year. Leading Moped manufacturer, Majestic Auto, also witnessed the same trend as it saw its sales declining by 6.5 per cent to 7,362 units during the reference month against 7,877 units sold in April 1999. Majestic was the only company which posted a negative sales growth in the segment during the month. On the other hand, market leader in the motorcycles segment Hero Honda clocked an impressive 51.5 per cent growth in sales at 79,681 units in April this year compared to 52,612 units in April last year. Motorcycle sales of Bajaj Auto also grew by 46.07 per cent to 39,958 units during the reference period from 27,098 units in the same period last year. |
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Teenagers
keep off Internet NEW DELHI, May 25 (UNI) — Contrary to popular belief, teenagers are not the most frequent users of Internet at cyber cafes, according to a survey. The majority of cyber cafe users lie in the age group of 19 to 25 years followed by frequent visitors between the age 26 and 35 years. Together, these age groups comprised mainly college students, businessmen and executives, says an IDC survey. The survey observed that cyber cafes users are generally from affluent backgrounds as 75 per cent of these visitors belonged to the socio-economic category. Although 70 per cent of cafe visitors have indicated of being aware of Internet commerce, only 7 per cent have actually made any purchase over the net. The most popular items of purchase over the
internet are CDs and books. As far as activities at cyber cafes are concerned, ‘e-mail’ and ‘chat’ are overwhelmingly popular with 53 per cent and 23 per cent share respectively. |
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Punjab to set up dairy board and fund CHANDIGARH, May 25 — While an Ordinance on the Punjab Dairy Development Board-2000 awaits notification, several questions about the World Trade Organisation vis-a-vis agriculture remain unanswered. Despite protests (remember the January 17 strike by milkmen?) and apprehensions in many quarters , the government appears determined to set up a Dairy Development Board and institute a Dairy Development Fund on the pattern of Rural Development Fund. The draft Ordinance on the proposed Board is awaiting clearance of the Legal Remembrancer, who has been sent several reminders since March to expedite the same, say informed sources . The Board, TNS learns, would coordinate between all organisations (Directorate of Dairy Development, Directorate of Animal Husbandry, Punjab Milkfed etc) dealing with dairy and livestock development. Besides, it will focus on genetic upgradation of milch animals, supply of quality feed and fodder, animal health care, enhancing milk production, products and processing, protecting interests of dairy farmers, set up demonstration centres for scientific dairy programmes etc. Besides other members the Board will have representatives of the milkmen, consumers, producers and milk plants. There is a proposal to abolish the present purchase tax on milk and replace it with a new cess at the rate of 10 paise per litre of the licensed capacity of the milk plants. There are about 45 such plants in public, private and cooperative sector covered under the Milk and Milk Products Order, 1992. Punjab favours that exemption under the Order be given to such milk plants whose handling capacity is 20,000 litres per day. At present milk plants
up to 10,000 litres capacity are exempt from registration under the Order. The proposed cess is a measure termed as “revenue neutral” aimed at providing a dedicated source of funding dairy and livestock sectors. Against present collection of Rs 10 crore, approximately, by way of sales tax, cess was expected to yield a revenue of nearly Rs 18-20 crore, which will form part of the Dairy Development Fund. Dairy and livestock contribute 17 per cent share to the state gross domestic product. An umbrella organisation like the Board is expected to raise milk production from 77 lakh tonnes (1999-2000) to 78.5 lakh tonnes in 2000-01 with current per capita milk availability going up from 856 ML to 1,000 ML. While a notification on constitution of the Board is expected any day, Punjab is seized of another important issue: implications of the WTO vis-a-vis agriculture. The Agreement on Agriculture (AOA) was signed at the time of Uruguay Round of negotiations in Maarakesh in April 1994. With agriculture having come under the new rules of world trading system for the first time, it was expected there would be hiccups in understanding and implementation of AOA. Consequently, Punjab Agricultural University, Ludhiana, prepared a questionnaire and sent it to the Indian Institute of Foreign Trade, New Delhi, in order to appreciate and understand what AOA in the context of WTO is all about. The Institute, on its part, has agreed for a one-day seminar on the subject to be held at PAU on May 27. The Institute Dean, Mr B. Bhattacharyya, will lead experts. The Financial Commissioner (Development), Mr Y.S. Ratra, told TNS today that he had sent official invitation to administrative secretaries and heads of departments dealing with agriculture and allied subjects and also boards and corporations engaged in procurement. Punjab as a leader in agriculture, is worried about real import of WTO implementation. This is the reason that PAU has sought clarification on the WTO clause on the minimum access tariff quota. This at reduced tariff is fixed at 3 per cent of the domestic consumption which is to be increased to 5 per cent by 2000 in case of developed countries and by 2005 by developing countries. What are the implications of this ? If
up to 6 million tonnes of foodgrain are imported into India it could completely upset the agricultural economy. Recent imports of wheat, sugar, milk etc are a pointer in this direction. Can “free” supply of power and water and subsidies on fertilizer etc be maintained under WTO ? Is there any safety-net to protect small time farmers and traders ensuring their livelihood is not affected ? These and several other technical and related questions will be raised at PAU seminar which Mr Ratra hopes would enable Punjab agriculture find home in globalising world.
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Leak-proof
condoms
NEW DELHI, May 25 (PTI) — Indian condoms will now be of international standards to provide better protection against HIV as the government has made the Drugs and Cosmetics Rules more stringent by bringing in an amendment. The government has asked condom manufacturers to modify the water leakage, burst volume and pressure factor of Indian condoms to afford greater protection against AIDS — causing HIV. The amended rules would make quality of Indian condoms at par with standards laid down by the WHO. The
amendment has made it mandatory for cosmetic manufacturers to disclose their names and address on products and permits storing of “physician’s samples” by authorised agents for distribution.
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NEW DELHI, May 25 (UNI) — Zee Telefilms Limited has decided to divest stake in the recently formed Zee Publishing Limited and transfer the equity to Mr Subhash Chandra and his family. While Mr Deepak Shourie will be the owner-cum-manager of the company, Mr Chandra and his family will now be strategic investors in the publishing business. Mr Shourie will continue as a CEO of Zee Telefilms, responsible for news and the FM radio business. Zee Publications will launch new publication within a month, company spokesman Ranjan Bakshi said, but refused to divulge further details. |
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Federal Bank UTV deal Ramco Systems Exim policy JK Paper J&K highway |
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