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| Wednesday, June 14, 2000, Chandigarh, India   
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RBI to formulate guidelines for
Industrialists threaten stir
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DoT may shatter Punjab IT dreams
Jet Airways proposal cleared
RBI to formulate guidelines for NEW DELHI, June 13 (PTI) — In a bid to tackle the whopping Rs 51,000 crore non-performing assets (NPAs) in public sector banks, the Reserve Bank of India (RBI) will formulate guidelines by July 15 to recover bad debts. A meeting between Finance Minister Yashwant Sinha and the chairmen of nationalised banks also decided to form a seven-member group headed by Indian Banks Association (IBA) Chairman S. S. Kohli to evolve a voluntary retirement scheme and improve the human resources base for stepping up efficiency of the banks. While formulating guidelines for tackling NPAs, the RBI will decide the benchmark for interest waiver on bad loans. The seven-member group has also been asked to submit its report by July 15. During a two and a half hour meeting, Sinha asked the 27 bank chiefs to personally supervise the bad debts of Rs 10 crore and above and take a decision by September 30 on whether to rehabilitate or restructure the loanee companies or to file a suit against them. At the end of the meeting, Special Secretary Banking, Devi Dayal told reporters the meeting also focussed on accelerating the priority sector loans. Bank officials would be provided incentives for speedy approval of loans as well as recovery of the bad debts. Earlier, the Finance Minister said he was concerned over the high level of NPAs even though these had marginally come down during the last fiscal. Devi Dayal said the RBI has been urged to come out with the guidelines after the bank chiefs agreed to uniform and non-discriminatory guidelines for the recovery of NPAs that will be applicable to all public sector banks. “There was a consensus that whatever guidelines are to be prepared, they will be completely uniform and in a non-discriminatory manner for all banks”, Dayal said, adding the bank chief executives also wanted these guidelines to be well
publicised. He said the earlier guidelines issued by RBI in regard to small scale units will now be extended to medium and large units besides agriculture and other sectors. These guidelines will apply to all loan outstanding of Rs 10 crore or below, Dayal said adding that this would cover about 80 per cent of the total gross NPAs. On the level of gross NPAs, Dayal said it had for the first time come down marginally from Rs 51,710 crore as on March 31st 1999 to Rs 51,667 crore as on March 2000. In percentage terms it came down from 15.89 per cent to 15.3 per cent, he said adding the ratio of net NPAs to net advances have been reduced from 8.13 per cent in March, 1999 to 7.44 per cent as on March 31, 2000. The Finance Minister advised the banks to submit a scheme for providing incentives to such field staff in the rural and semi-urban areas “as do good work for the recovery of loans and expedite priority sector loans”, Dayal said. The meeting also decided to enhance the component of education loans for students. |
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DoT may shatter Punjab IT dreams CHANDIGARH, June 13 — The lack of “broad bandwidth connectivity” is now threatening to stunt the
fledgling Information Technology (IT) industry in Punjab. Even the “terms and conditions” as per Clause 19 laid down by the Department of Telecommunication (DoT) are turning out to be an
impedement for the state as an IT “destination” when it comes to setting up of International gateways by the Internet Service Provider (ISP) licensees. The relevant clause reads “International gateway shall not be set up in security sensitive areas. The Internet nodes in places of security shall be routed through VSNL only. As on date the security sensitive areas are Punjab, J and K, North-Eastern States, border areas of Rajasthan, Andaman and Nicobar Islands and coastal areas of
Gujarat and Tamil Nadu”. Punjab’s plea to the Centre is it would like to
support any endeavour that would assist in preventing anti-national activities in this area of high technology. Moreover, what a dichotomy that an ISP can set up an International gateway at Chandigarh or Panchkula (Haryana) but not in “contiguous” Mohali (S.A.S. Nagar) just because it happens to be in Punjab. This is one place which already has an earth station. Both the Software Technology Parks of India (STPI) and Puncom — VSNL (Videsh Sanchar Nigam Limited) have set up shop in Mohali and Jalandhar. Punjab has already announced its IT policy and state’s officials have been to the USA to
attract investment in IT. But now the DoT clause is there which restricts Punjab to looking only at STPI and or VSNL. Unless the Centre intervenes quickly and effectively the state’s plans for International gateway would only result in Punjab to forego its plans of seeking investments from abroad in IT. It is certain that neither STPI nor VSNL can meet even a fraction of the demand of the state. Some of India’s and also of North America’s largest software companies have set up their operations in Mohali. However, these companies are now unwilling to expand their operations due to the problem of bandwidth. Punjab’s joint venture plans may also get aborted if the clause is not suitably amended and also steps taken to provide for broad bandwidth connectivity. The existing system is already choked by over 30 per cent. Mr Parkash Singh Badal is learnt to have shot off an urgent letter to Mr Atal Behari
Vajpayee to intervene at the earliest. Punjab plans to have its International gateways at Mohali, Ludhiana, Jalandhar and Patiala. It is keen to see at least one International gateway operational at Mohali in July. Only then industry’s demand can be met. Delay, it is apprehended, may hurt the nascent IT industry. Unless Mohali is declared an “exclusive economic zone” and made
hassle-free IT industry will elude Punjab. Punjab is to sign an MoU tomorrow which will enable use of the Punjab State Electricity Board’s electric supply poles for wiring the state. |
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Reliance merger with RPL ruled out MUMBAI, June 13 (UNI, PTI) — Reliance Industries Ltd (RIL) is all set to declare yet another handsome financial performance on July 20, Chairman Dhirubhai Ambani said
today. Addressing the 26th annual general meeting (AGM) here this morning, Mr Ambani said that RIL expects exports of Rs 2500 crore (over $ 500 million) this year. Reliance Petrochemicals Ltd (RPL), Mr Ambani said attained full rated capacity within three months thereby establishing a new world record. RPL is likely to achieve a turnover of Rs 25,000 crore (nearly $ 6 billion) this year. Ambani claimed that RIL and RPL will be India’s top private sector companies from this year. Ambani claimed that RIL and RPL will be India’s top private sector companies from this year. Outlining Reliance’s plans to build a world class Internet infrastructure in India, Ambani said the company plans to roll out world class, all optic, Internet protocol based, broadband network covering top 115 cities in India. It will provide integrated broad brand services with value added voice image and data offerings over its networks. According to Mr Ambani, broadband network and Internet data centres will deliver advanced applications and solutions, including e-commerce, media-casting, web hosting and managed software services, to businesses, consumers and service providers. The network will provide capability to participate in local, long distance and international communication markets as well as in the markets for trading of bandwidth, as reforms progress in this sector. Ambani ruled out raising funds through an
American Depository Receipts (ADR) issue in the near future. He also ruled out the merger of RIL and RPL as also the group’s entry into pharma sector. RIL’s focus will continue on existing businesses such as oil and gas, refining and marketing, petrochemicals, power and telecom, he added. Referring to cellular services, he said Reliance expects to expand its
operations from the present 30 cities, having a subscriber base of 70,000, to over 90 cities and double the subscriber base in the next one year. Reliance expects to achieve power capacity of 10,000 MW over the next 10 years, Ambani said.
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Industrialists threaten stir CHANDIGARH, June 13 — Industrialists in Punjab have threatened agitation if the Punjab Government persisted with its decision to hike power tariff. Leaders of various industries associations who met the high-power committee constituted by the government to discuss the issue of power hike later said that they would not tolerate any hike. ‘‘We must first have power sector reforms and then only we can consider any increase in power rates. We do not know how this government functioned. The Cabinet had decided long time back to have a power regulatory commission, but nothing has materialised. The electricity board suffers losses as it is inefficient, over staffed, corrupt, power theft is too common and the government all the time wants to pass on this burden on the consumers of various categories’’, Mr Harish Khanna, one of the participants told TNS. Others who supported him in the meeting included Mr Balwant Rai, Mr Jaswant Singh Birdi, Mr Amarjit Goel, Inder Mohan Singh Grewal, Inderjit Singh, Mr R.P. Bhatia, Mr C.S. Matharu and Mr Avinash Arora. Official sources here confirmed the agitating mood of the industrialists who otherwise too are suffering the pangs of recession. ‘‘Cheap power is the only incentive that we have in Punjab. We are away from the sources of raw material and ports. Once this incentive is gone. We would be compelled to shift to other states’’, Mr Khanna maintained. He declared, at no cost the power rates be hiked. These would be the last nails in our coffins’’, he added. Mr Oswal, Chairman, CII, Punjab State Council, suggested for fixation of power tariff norms essentially with a view to curb cross subsidisation of power in Punjab. Refuting the figures quoted by the Punjab State Electricity Board wherein the average cost of power per unit has been pegged at Rs 3.50, he said that the average cost of power including T&D losses @ 18 per cent does not exceed Rs 2.40 per unit. He also highlighted the fact that the average power tariff being paid by industry in Punjab was as high as Rs 2.80 per unit which included a surplus of 3 per cent on PSEB’s fixed assets. Highlighting the inefficiencies of the Board in terms of surplus manpower and significant inventories, Mr Oswal expressed the view that industry in Punjab was already suffering from several geographical disadvantages and any irrational increase in power tariff would lead to industry becoming uncompetitive which was not even in the larger interest of Punjab. Referring to the tariff sub-committee constituted by the consultative council of the Punjab State Electricity Board way back in 1986 under the chairmanship of Mr R.N. Gupta, the then Member, Finance and Accounts, PSEB, Mr Oswal said that this committee of which he was also a member had then expressed the view that ‘‘each sector of consumers should pay to the Board an economic tariff which includes an element of surplus also and therefore losses on account of agriculture power should not be passed on to the other consumers’’. Mr Goyal, Chairman, Punjab Committee, PHDCCI said as per the data provided by the PSEB there is major difference in the audited balance sheet which shows a net surplus of Rs 170 crore for the year 1998-99. Whereas the financial position put forth at the Chief Minister’s meeting shows loss of Rs 877 crores. There is huge burden of employment cost which is increasing the burden on the PSEB from Rs 701 crore in 1997-98 and Rs 1169 crore in the year 1998-99. It is estimated there are more than 97,000 employees in the Board. At least 30,000 employees are surplus. There is a sudden jump projected in interest and finance cost. In the fiscal 1998-99 acutals stands Rs 489 crores against the projections of Rs 945 crore for the year 2000-2001. This additional cost is attributed due to non receipt of subsidy from the Punjab Government which stands at Rs 1930 crore in the year 1998-99. With Rs 1000 crore additional due from State Government for the year 1999-2000, the total amount works out to be Rs 3,000 crore approximately. The agriculture sector which consumes a major portion i.e. 35 per cent of the total generation of electricity in the State is provided free electricity. Free electricity to any section of consumer puts undue burden on others. Therefore the industry is burdened with cross subsidisation. The present government led by Mr Parkash Singh Badal which supplies free power to the farm sector, had increased power rates for the industrial, commercial and domestic sectors by about 17 per cent in 1998. Now the Board wants to have the rates jacked by up by 35 per cent. The government agrees to increase it by 15 per cent. The board is suffering gross loss of Rs 1380.51 crore this year. According the documents provided by the Punjab State Electricity Board the losses due to several factors are on the increase. Gross losses excluding subsidy were Rs 877 crore during 1998-99, Rs 1155 crore next year and now these would cross Rs 1380.51 crore. After taking into account the internal accruals the loss during the current year is still Rs 930.41 crore. It is widely acknowledged by political masters and officers that there is a rampant corruption in the Board and theft of electricity is also common. Overstaffing by about 30,000 employees has also been admitted. In one case in Ludhiana alone, the theft detected amounted to Rs 2 crore. Then the free power to the farm sector is a big drag. Now even the Akali leaders, including the Union Minister, Mr Sukhdev Singh Dhindsa and the Minister for Irrigation and Power, Mr Sikender Singh Maluka, have suggested that the farmers should pay for power. Mr Badal despite having committed to charge at least 50 paise per unit from the farmers at the national meetings, is scared of the political fallout. His detractors both within the ruling Akali Dal and in the Opposition charge that in order to help the big farmers, he has provided free power to the farm sector. Last year the Board supplied 8,200 million units of power to the farm sector and to the Board employees. All this supply is
unmetered. |
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NEW DELHI, June 13 (PTI) — Proposals of Jet Airways and Powergen India to issue preference shares abroad were among Foreign Direct Investment (FDI) worth Rs 429 crore cleared by the government today. Industry and Commerce Minister Murasoli Maran approved 29 FDI proposals including that of UK based power major Powergen to issue preference shares worth Rs 300 crore in its holding company in India, an official release said here today. Domestic airline Jet Airways has been allowed to issue non-voting cumulative convertibile redeemable preference shares worth Rs 66 crore. These proposals were cleared by the minister on the recommendations of the Foreign Investment Promotion Board (FIPB). Enron Corporation’s Indian subsidiary Enron India Ltd has been allowed to enter into Liquefied Natural Gas (LNG) infrastructure associated with power plants in the country, the release said. Enron is planning to set up a five million tonne LNG import facility at Dabhol in Maharashtra for its 2,144 MW power project besides entering into the pipeline business. Approval for India
Incubator engaged in the development, promotion and marketing of websites including e-commerce and computer consultancy business has been allowed to pump in Rs 21.75 crore in the company. The government also approved the proposal of Mauritius based International Web Travel Pvt Ltd to bring in Rs 8.70 crore in its company involved in the business of providing web based information, advice, consultancy and commercial services. US
multinational United Dominion Holding Inc, has been allowed to bring in Rs 21.50 crore for carrying out business relating to manufacture of evaporative cooling towers and air cooled heat exchanges. Internet Service Provider Smifs Capital Market Ltd has been allowed to increase its equity from 21.04 per cent to 28.07 per cent in the internet service providing and data processing company. The firm would have to pump in Rs 1.50 crore for increase of its stake, it said. Telecom company Amoeba Telecom Private Ltd’s proposal for bringing in Rs 6.52 crore in the Data processing, software development and computer consultancy has been approved by the government. Amoeba would hold a 33.33 per cent equity, the release said. It said approvals had also been given to Tata Finance Ltd for carrying out online, telephone and branch trading business to individual and other clients. Engineering and Consultancy Company Daelim E&C India Ltd has been given permission to decrease its equity from 50 per cent to 19.98 per cent. |
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Joel Klein: man who felled Microsoft WASHINGTON: With a huge victory under his belt in the Microsoft antitrust trial, Joel Klein has earned a reputation as a champion of the consumer in the face of the excesses of capitalism. Klein, head of the Justice Department’s antitrust division, was the driving force behind the government’s effort to break up the software behemoth, which resulted in a historic ruling last week by Judge Thomas Penfield Jackson. “This landmark decision demonstrates once again that no company, no matter how big or how powerful, can refuse to play by the rules” of competition that is “at the heart of the US economy,” Klein said after the decision. “Joel deserves a lot of the credit because he had the courage for starting and actually pursuing the case,” said Washington antitrust lawyer George Carey. Klein, a 54-year-old Harvard Law School graduate, heads a division of some 300 lawyers. He was personally involved in the Microsoft case, and was present at the key moments of the 20-month legal process. However, the government’s top trust-buster, son of a mail carrier from the New York borough of Brooklyn, does not see himself as a foe of capitalism itself. “We actually disfavour government regulation and micromanagement of any corporation,” he told CNN after the judge’s decision. “Our view is let market forces work. They work much better. On the other hand, if you have a monopolist — like we currently have — willing to abuse its monopoly, that’s what hurts consumers, that’s what limits choice, that’s what the whole trial was about.”
— AFP Reverse auction site for hotels NEW DELHI: India’s first reverse auction website for hotels, RazorFinish.com, will allow customers to choose the price of a hotel room as competing hotels bid the price down to sell a vacant room. A buyer-driven e-commerce model, the central concept of RazorFinish.com is a reverse auction where the sellers bid the price down to match the customer’s preference, Annat Jain, founder of the website told PTI. The website, already in operation has tied up with leading hotels like Radisson, Le Meridien, and The Manor in Delhi, Mumbai and Bangalore and is talking to other hotel chains. The e-commerce venture, which has a fund base of Rs 10 crore will generate revenue from the commission charged from customers, besides the listing fees charged to the hotels on a monthly basis. At present, 10 per cent is charged as commission from the hotel guest of which five to six per cent is given to the credit card companies for providing Internet based credit card transactions.
— PTI Yahoo! chooses DGreeting NEW DELHI: Yahoo!, popular website, has chosen the Indian greeting card site DGreeting.com for a co-branding arrangement, under which Yahoo! India to the launched shortly will have an exclusive channel for Indian greeting products. As per the agreement signed by the holding company of DGreetings.com, “Allownders.com”, Yahoo! was co-brand and use DGreetings.com’s products in India as well as abroad. DGreetings.com has been chosen by Yahoo! for this strategic alliance as the site has separate channels for Holi, Diwali, Eid namely “Holihangama.com’, ‘TheEid.com’ and ‘Diwalimela.com’, Simarprit Singh, Managing Director of Allwonder.com told PTI here. It also has channels such as “MyDearValentine.com’ ‘ChristmasCarnivalas.com’ and 2000Fair.com. DGreetings has also developed an exclusive parallel site named ‘TheyDeserveIt.com’ for sending gifts to dear and near ones in any part of the world. — PTI
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SAS ties up with Satyam High safety rating for Vardhman TN Petro turnover goes up First technology channel launched |
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i2k2 Systems Chamber Ballarpur Ind Launched |
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