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| Tuesday, September 19, 2000, Chandigarh, India   
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I-Sec predicts 7,000 cr
fiscal slippage this year Half of NPAs due to priority loans: FICCI Canadian institute
opens in Mohali Stocks manipulated? Prove it: HC Rupee slumps |
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Computer whizkid,
aged two & a half DCA after vanished
companies
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I-Sec predicts 7,000 cr
fiscal slippage this year MUMBAI, Sept 18 (PTI) — ICICI securities (I-Sec) has forecast a slippage of Rs 7,000 to Rs 8,500 crore in the fiscal estimates for the current year, and higher monetisation due to a higher oil import bill. ‘‘High crude prices are likely to lead to an oil pool deficit of Rs 14,000 crore by the end of the fiscal, after adjusting for which the total indirect tax collections are expected to be Rs 11,000 to Rs 12,000 crore lower than the budget estimates,’’ I-Sec said in its fortnightly review of debt markets for the first half of September. On the other hand, I-Sec said the oil import bill, expected to cross $ 18.5 billion if the prices stay firm around the current levels, would result in rise of 40 to 45 per cent in the trade account deficit (Directorate General of Commercial Intelligence and Statistics coverage) or 20-25 per cent (as per RBI format). Overall, the current account deficit is likely to increase from $ 4.2 billion last fiscal to $ 6-7 billion, it said. With capital flows likely to be weaker than last year, I-Sec expects a depletion of RBI forex reserves by $ 2-2.5 billion which in turn would affect the liquidity impact of the apex bank’s forex intervention. I-Sec was of the view that the liquidity gap is likely to be funded through further monetisation of government debt or changes in cash reserve ratio requirements or refinance limits. Though direct tax collections are expected to be Rs 5,000 to Rs 6,000 crore above the estimates, the deficit in indirect tax collections was more than negating the strong direct tax collections, the review said. The review also predicted a shortfall of Rs 5,000-6,000 crore in divestment proceeds for the fiscal. With industrial production losing momentum, the shortfall in indirect tax collections is likely to be around the same amount. Adjustment due to rationalisation in duty structure of petroleum products is likely to fetch about the same amount, I-Sec said adding this would bring down the total revenue slippage to Rs 10,000 to Rs 13,000 crore. The other saving grace is the likely cut in expenditure, projected at Rs 3,500-4,000 crore, which is likely to bring the total estimated slippage for the current fiscal to Rs 7,000-8,000 crore. Though the direct tax mop-ups have grown by 70 per cent year-on-year, the rise in tax revenues has witnessed 25 per cent increase in April-July period, it said adding, however, that growth in indirect tax collections at 11.7 per cent has been lower than the budgeted target of 14.5 per cent, with both Customs and Excise collections at tardier pace. Total expenditure in April-July 2000 declined by 1 per cent year-on-year on account of 5 per cent decrease in non-plan expenditure, it said. |
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Half of NPAs due to priority loans: FICCI NEW DELHI, Sept 18 (PTI) — The role and responsibility of industry in the piling up of non-performing assets (NPAs) worth Rs 52,000 crore and the myth that the industry is entirely responsible for it is a misconception, FICCI has said. About half of the NPAs are accounted for loans to the priority sector which include entrepreneurs involved in agriculture, small-scale industry and those who are not able to generate their own finance to invest into their ventures. “If a borrower does not return its interest and the principal amount even in instalments for two quarters of the stipulated time it is termed as NPA,” says Anjan Roy, adviser, economic affairs in FICCI. A new study by FICCI called “Bank NPAs: Need for a New Perspective” notes that half of the NPAs are “accounted for by loans to the so-called priority sectors. “These have been granted over the last 25 years and in many cases in reckless abandon to any sense of security or viability of projects for which loans have been granted. They were basically political decisions, and so need to be treated on a different footing from other loans, the study observes. According to Roy, while people think that the total amount involving NPAs is the principal amount in reality the bulk of the total amount is accounted for by accumulated interests. Concerned about the NPAs, Finance Minister Yashwant Sinha recently convened a meeting of banks’ chief executives and deliberated in detail on issues pertaining to NPAs and urged sincere efforts to bring down the level of NPAs. Of the balance non-priority sector loans, the bulk of the amount shown running in default are due to the unrealistic interest rate policies followed by the banks, the study says. “A very large proportion actually reflects the principal sum tied in NPAs. The balance i.e 70 per cent is interest and penal interest charged over the extended period. In many cases, the interest charges have been as high as 28 per cent, a rate which no business can earn and pay on any reasonable assumption,” it says. A categorisation of NPAs of public sector banks was attempted in 1985-86 by the RBI with the introduction of a “health code system” in the banks. The code attempted to classify the quality or health of individual advances through classification in eight categories. These are: satisfactory, irregular, sick-viable, sick-non viable, sticky, advances recalled, suit file accounts, decreed debts, bad and doubtful debts. New forms for recognition of income basis of health code system were introduced subsequently in 1989 under which the banks were advised to recognise income only on realisation basis for accounts under the suit filed accounts and codes above. These were further fine-tuned and the Narasimhan Committee introduced new norms for income recognition in 1991. The Committee recommendations were introduced between 1992 and 1993. Currenty the income recognition, asset classification and provisioning for NPA norms are: Income recognition: income should not be recognised on NPAs on accrual basis but should be booked only when it is actually realised in respect of such accounts. Asset classification: An asset is considered “non-performing” in case of interest or instalments of principal or both remain unpaid for more than two quarters and if it has become past due — 30 days after the due date. An advance is to be classified as “substandard” if it remains NPA up to a period of two years, as “doubtful” if it remains NPA for more than two years and an account will be classified as “loss” without any waiting period, where dues are considered uncollectable or only marginallly collectable. Provisioning of NPAs: Based on the asset classification, the banks are required to make provision against the NPAs at 100 per cent for loss assets, 100 per cent of the unsecured portion plus 20 per cent to 50 per cent of the secured portion. On the basis of these norms the total NPAs of the public sector banks were estimated at approximately Rs 51,000 crore. The share of NPAs in the priority sector at present is 43.7 per cent and that of the non-priority sector around 53.4 per cent. According to the study, reduction of NPAs by the banking sector should be treated as national priority to make the Indian banking system more stronger, more resilient and geared to meet the challenges of globalisation. It recommends quick settlement of NPAs in a time bound manner. Discretionary powers should be given to bankers to decide on treatment of NPAs and there should not be any “thumb rule for tackling this issue”. A distinction must be made between wilful defaulters and those who defaulted due to business dynamics beyond their control. It also says that settlement formula should be based on simple interest calculation rather than on compound basis. Compromise settlement has been also considered the best alternative by various committes Regarding enforcement of personal guarantee, it needs to be emphasised that that a company promoter has a limited liability and this concept should be strenghtened otherwise it would discourage new entrepreneurship, the study says. |
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Canadian institute
opens in Mohali CHANDIGARH, Sept. 18 —The Canadian Institute of Computer Science and Technology (CICST) campus was inaugurated at Mohali today by Mr. Brian Tamblyn, President of Georgian College, Ontario, Canada. The institute, which will provide computer education , is an extension of the Georgian College, Canada. Brought into India by Worldwide Immigration Consultancy Services (WWICS), CICST has plans to provide computer education using the latest American teaching tools and methods provided by Georgian College. “Indian talent especially in the field of computers has been recognised worldwide. And it is due to the tremendous response towards this sector in India which connected us to the project”, said Mr Tamblyn. Mr. Tom Morrisey, the Project Director of CICST said: “The faculty members have been trained at Canada since the entire curriculum of the course is exactly on the patterns of Georgian College”. He said the students of the institute will have transfer option to the Canadian campus. In the total six semesters of the course, two semesters will include co-op placement of the student with a firm for which he will also get paid. Regarding employment opportunities, Mr. Tamblyn said more than 95 per cent of the students from Georgian College get recruited within six months of the completion of the course.”Our placement rate has been the highest till date”, he said, adding that last year for the same course, 100 per cent of the students had got employment in good companies.” For the first semester of the computer programmer analyst course which will start from next month , 50 students have already been enrolled. Investment in the initial phase has been more than Rs. 2 crore and officials say that more will be spent at later stages. Plans to start short-term courses, including courses for professionals and other streams like web space security, engineering , business administration are on the anvil. |
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Stocks manipulated? Prove it: HC NEW DELHI, Sept 18 (PTI) — The Delhi High Court today asked a petitioner to substantiate allegations of stock market manipulation by foreign financial institutions, major brokers and big Indian companies with the active support of SEBI. A Division Bench comprising Chief Justice Arijit Passayat and Justice D.K. Jain asked advocate Manohar Lal Sharma, who in a PIL petition sought investigation into the allegations, to place before it more material relating to alleged involvement of SEBI in stock market manipulations. The court said it must be satisfied under which provision of law SEBI was giving waiver to the FIIs and other big investors for trading without depositing margin amount of transaction as was being done by it in the case of small investors. Was SEBI controling the market under some statutory rules and guidelines or on its own, the petitioner must satisfy the court on this aspect before seeking notice to respondents, the Bench said. The court adjourned the hearing to September 27 after the advocate said he needed at least two days’ time to place the material before the court to show how the stock markets in the country were being “manipulated” by the FIIs, big Indian companies and major brokers with active support of SEBI. There was no statutory rule under which SEBI could compel a set of investors to perform the obligations of transactions in a particular manner and waive of the conditions to others, he said adding that it could not differentiate between the big and small investors. Sharma alleged that SEBI had imposed the margin rule upon the domestic investors, while the FIIs, all mutual funds and big Indian institutions were exempted from depositing any “margin money” on bulk buying of shares. “They can trade any amount of transaction and can hold outstanding (payment) without the margin,” he said. Giving details about the alleged manipulations, he said after imposing the condition of depositing the margin money on small investors, the FIIs and top brokers were resorting to “repurchase of their scrip at low value to book profit”. “When they see that the rates have come down at desired level, they, during the trading hours, again declare to remove the additional margin quantity to increase the market again. This game of up and down is created by SEBI to facilitate its real friends the FIIs and the small investors were suffering heavy losses,” Sharma said. Several reports regarding this controlled trading have appeared in media, which were not denied by SEBI. |
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Rupee
slumps mumbai, sept 18 (pti) — The rupee slumped to a new all-time low close of Rs 45.99/46.01 per dollar at the interbank foreign exchange (forex) market today following hectic dollar demand from corporates and importers over concerns on rising global oil prices. The Indian currency has depreciated by a whopping 22 paise from weekend closing levels of Rs 45.7800/7850, as worries of high crude prices impacting the oil import bill, induced operators to scramble to cover dollar positions. Further, weaker and volatile capital account inflows have led to apprehensions of further pressure on the rupee, dealers said. The rupee’s earlier record-low close was logged on August 17 and it plunged to historic-lows of Rs 46.05/10 in intraday deals on August 11. |
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Computer whizkid,
aged two & a half BANGALORE, Sept 18 (ANI) — Mohammed Swaroop, two and a half years old son of a school teacher Rafiq Mohammed, has difficulty in pronouncing his own name but not in creating an e-mail account for himself. While children of his age falter in spelling the word computer, Swaroop has mastered several software packages like Microsoft’s windows, Word, Excel and Clipart. Swaroop has also created his own website on the internet. At www.iqtot.bizland.com, he posted his photograph, information about his parents, his achievements and pronounced himself a computer whizkid. Swaroop could barely pronounce the address of his website. All the words that come out of his mouth are “iq.com”. Swaroop’s father Rafiq Mohammed takes pride in his son’s achievements. “Now he can do Microsoft Word, Word, Clipart, he can print, he can type, scan photos, send e-mails, work on the Internet, he can play CDs, play music, he can install CDs,” Mohammed said. Swaroop’s extraordinary capabilites came to the fore when he learnt all the 26 English alphabets in a single day when he was barely 18 months old. Swaroop’s mother said her son was different from other kids of his age. She said he neither mingled with other children nor showed any interest in games. |
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DCA after
vanished companies NEW DELHI, Sept 18 — Several companies which duped innocent investors and then vanished face action from the Department of Company Affairs (DCA). Out of the 142 vanished companies identified by SEBI, the DCA has initiated action against 93 companies. However, the DCA has a tough job in hand as 24 of the 93 companies are non-traceable even after the inquiries. Of these, two companies have been taken over by the Punjab Government. The 142 companies, which do not include names of companies doing business in plantations, non-banking finance and software companies, have fleeced investors to the tune of Rs 669 crore. The DCA has constituted seven task forces regionwise at Delhi, Mumbai, Chennai, Ahmedabad, Bangalore, and Hyderabad with the Regional Directors and Registrars of companies as conveners and the representatives of SEBI and stock exchanges as members. The primary responsibility of these task forces is to identify the vanishing companies of their region by going through the information available with these agencies. These task forces are monitored by a Central Coordinating Committee with the Secretary, DCA and Chairman, SEBI, as its Co-Chairman. The Government has also put in place several measures to ensure that investors don’t get duped by unscrupulous companies in the future. To protect the interest of the investors, a new Section 205 C has been inserted in the Companies (Amendment) Act, 1999 to establish a fund called “Investor Education and Protection Fund”. |
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Holiday for land in Israel jerusalem: When Israelis use the phrase ‘’cucumber-picking season’’, they are usually talking about the slow days of late summer when nothing much happens. But this year the cucumbers themselves are at the centre of a growing debate surrounding Judaism’s ancient “Shmita’’ laws which command that the fields of Israel lie fallow every seven years. Shmita begins on the Jewish new year on september 30 and promises to affect thousands of farmers, restaurants and families as a stricter interpretation of the ritual law is enforced by orthodox religious leaders. “Before we had Shmita, the religious hierarchy who make laws for the community allowed some leniency,’’ said Yehoshua Polak, Chairman of the Jerusalem Religious Council. “They were allowed to use the land because there was not enough food for the country,’’ he said. “But now with technology, it’s very easy to get food from other countries and there are more options. It’s a little difficult, but people can survive.’’ Shmita is based on a Jewish law recorded in the Biblical book of Leviticus as a God-given command to Moses on Mount Sinai. It says Israelites cannot till, plant or harvest their fields during the Shmita year because it is the land’s sabbath rest. — Reuters Culinary Olympics new delhi: A culinary Olympics is on at the state-run Ashoka Hotel here which has turned its popular Coffee Shop into a mini Sydney offering a special menu to food and sports lovers in the capital. Colourful Olympic insignias, mascots and players in action dot the restaurant and its entrance while a giant television screen heightens the excitement of the events beamed live from Kangaroo country. The staff too wear Olympic ring badges and each table is decorated with Olympic flags and other mementos. For the gourmet, the Master Chefs have created a special menu befitting the occasion, which include exotic drinks such as ‘Sydney Flame’ and ‘Kangaroos’ Kick’ and snacks like ‘Hurdles-Triathelon’, a delicious non-vegetarian platter consisting of chicken nuggets, spicy fish fillet and mutton balls in garlic sauce. For the vegetarians, it is the penthathelon, an assortment of snacks. The soup section entitled ‘Hello to the Mascots’ has on its menu Millie, Olly and Syd complimented with Ping Pong -a low calorie sandwich and ‘Hammer Throw’ - a juicy chicken burger. The main course includes ‘Peppy Peddlers’ - southern fried chicken, ‘Saddle Strokes’ - grilled lamb chop and ‘Tussle on Turf’ - macaroni with spinach. And for the sweet tooth, on offer, are desserts like Apple Pie and Kiwi Sundae. — PTI Making money, Chinese style SHANGHAI: Policeman in China’s eastern province of Jiangsu have found a novel way to fill their pockets with cash: They have opened a brothel, arrested customers and”fined” them. With seed money of 6,000 yuan ($725), Lishui County police substation deputy chief Gao Mingliang set up operations in a brothel disguised as a restaurant in May last year, Shanghai’s Xinmin Evening News reported on Monday. Prostitues would entice their customers into the back rooms. After a while, the police would raid the rooms, arrest the customers, haul them down to the police substation and fine them. “Depending on how much money the police station pulled in, they would issue a performance bonus to the girls,” the paper said. Between May and August last year, the bureau racked up more than 80,000 yuan through the scheme. The Lishui County police plan unravelled when a neighbouring police substation arrested the man listed as owning the restaurant and sentenced him to a year in a labour camp for running a brothel. Upset after a year of hard labour, the man sent a petition to high level officials who uncovered Gao’s scam. — Reuters |
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Bank of Punjab Ikon Portals Entranceguru Satyam Whale VSNL |
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