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Saturday,
September 15, 2001,
Chandigarh, India  
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Rupee free fall continues
Wall Street may never regain status
‘No market fee on wheat, maize’
Pvt sector, govt networking mooted |
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SEBI asked to probe top gainers, losers
Sumitomo, Swaraj Mazda to launch vehicle
US stocks to trade on Monday
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Rupee free fall continues New Delhi, September 14 The rupee closed the day at Rs 47.81 to a dollar — a significant drop of 25 paise as compared to the previous days closing. Analysts said that the RBI may soon need to intervene through pumping of additional dollars to prevent the domestic currency from slumping further. While a weak rupee would make Indian exports price competitive in the global market, it also has the possibility of increasing the country’s net import bill. Analysts, however, pointed out that India is essentially an exporter of primary products which have a very low price elasticity of demand. Consequently, not much increase in demand may be forthcoming for Indian exports, even if a weak rupee reduces the price of goods in the international market. USA has been India’s largest export destination over the years and the share of India’s exports to US has been way ahead of other countries. USA accounts for more than one-fifth of India’s exports and its share in India’s exports in the last five years has shown a steady upward trend, growing from 17 per cent in 1995-96 to a little less than 23 per cent in 1999-2000. The USA is currently in the midst of a severe economic downtrend and the slowdown had already started affecting Indian exports. Presently, India has fairly comfortable level of foreign exchange reserves of about $ 45 billion and it will important to see to what extent the RBI is willing to pump in dollars in the forex market to stop the slide. On the capital market front, sustained selling by FIIs brought down the index further and the Sensex closed the day at 2830.12 points — down by 157.38 points or 5.27 per cent as compared to the previous days closing. FIIs offloaded funds to the tune of $ 8.5 million on
Thursday. Mutual Funds, however, were net buyers and bought stocks worth Rs 213.7 million on Thursday. Marketmen said that there was considerable uncertainty in stock markets with regard to anticipated retaliatory strikes by the US in Afghanistan. |
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Gold zooms by Rs 125
Mumbai Stockists started buying the yellow metal in huge
quantity fearing scarcity of stocks in the immediate future. With the cancellation of many international flights, arrival of gold through official channel had fallen drastically, traders said. Standard gold opened on a firm note at Rs 4,610 and shot up further on frantic buying and closed at Rs 4,700, showing a whopping Rs 125 rise over yesterday’s close of Rs 4,575. Ten-tola gold also resumed sharply higher at Rs 54,000 and skyrocketed to Rs 55,000, showing a huge rally of Rs 1,550 over the previous close of Rs 53,450.
PTI |
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Wall Street may never regain status New York, September 14 When two hijacked airplanes slammed into the twin towers on September 11, the subsequent collapse of the trade center and surrounding buildings killed perhaps thousands and displaced at least 40,000 people. The disaster may have put the nail in the coffin of an area that already had seen an exodus of premier investment banks. “Wall Street is becoming more of an electronic business,’’ said James Park, a trader for brokerage Brean Murray & Co. “It’s nice to go down to the exchange, there’s a certain nostalgia. But times change and this (event suggests) we need to re-evaluate what happens in terms of security and where things are.’’ Many financial firms now are relocating to New Jersey and other locations to prepare for the resumption of trading, and experts say some of these moves could become permanent. In addition, firms may avoid the Wall Street area because of its high real estate costs and out of fear for further attacks. “Most companies will start to re-assess where other support functions, back-office-type functions really needs to be located,’’ said Mark Smith, managing partner of real estate advisory services at Ernst & Young. “If they had space in New York, they may look at this now as an opportunity to relocate some of that to a less expensive area.’’ The collapse may have destroyed as much as 20 million feet of office space in lower manhattan. That’s one-fifth the total area available for offices in the area and the equivalent of the total amount of business space available in nashville, Tennessee, or Minneapolis-St. Paul, according to Ernst & Young. Less than 4 per cent of Manhattan’s office space was vacant in the fourth quarter of 2000, according to Reis.Com, which provides real estate data. That means there’s far more demand than supply. The World Trade Center was home to operations of more than 80 firms, including Morgan Stanley and Switzerland’s Credit Suisse Group Inc. Although both investment banks have their headquarters uptown. One of the largest US bond traders, Cantor Fitzgerald, was headquartered in building one. Companies forced to relocate because of the blast say they don’t know when they’ll be able to return to buildings in the area. New headquarters may become permanent. “Clearly some space that’s gone will have to be replaced with midtown,’’ said Bruce Mosler, President of American operations of real estate firm Cushman & Wakefield, referring to central manhattan. Cushman & wakefield manages about 24 million square feet in the area, said Mosler. Lehman Brothers had two floors in the World Trade Center and is headquartered in the adjacent World Financial Center, which was evacuated after the attack. Lehman will now transfer some operations to its London, Tokyo and New Jersey offices, said spokesman Bill Ahearn. Morgan Stanley, the top US Investment bank and the World Trade Center’s largest tenant with 3,700 employees, said operations previously located at the World Trade Center will be moved to other sites in manhattan and facilities in New Jersey and Brooklyn. The blast also slammed shut the doors of the 98-year-old New York Stock Exchange, which is the cornerstone of Wall Street. The building is just two blocks away from the mangled metal and smoking metal that was once the Trade Center complex. The exchange said on Thursday it would be closed through Monday, making it the longest down time since World War I. The hugeness of the Trade Center disaster may succeed in damaging Wall Street as a prized business address — far more than the horse-drawn carriage bomb (packed with 500 pounds of broken-up windows-sash weights and explosives), which exploded in September 1920, killing 30 and shattering many windows. There is also the chance businesses will avoid Wall Street because of security concerns.
Reuters |
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‘No market fee on wheat, maize’ Chandigarh, September 14 With an view to promote the food processing industry the minister also said that no rural development and market fee shall be levied on fruits and vegetable processing industries through contract farming. Mr Badal also said that abolition of octroi is under active consideration and the state government will announce its decision regarding this within a few weeks. The PHDCCI President, Mr Sushil Ansal, who was here today met the CM alongwith representatives of industry to discuss key issues pertaining to the industry in the state. The members of the Chamber demanded abolition of octroi and suggested that revenue losses due to this abolition can be covered up by levying property tax which is not applicable in the state at present, said Mr Ansal in a press conference here today . Almost Rs 400 crore worth of subsidies which had been promised to the industrialists have not been paid. “Global recession might lead to closure of more units so we want that the subsidies which had been promised be paid”, said Mr Ansal. Other issues discussed were power subsidy to the farmers and the industry representatives said that atleast recovery of atleast cost of services by the government would add to the exchequer and can be used for infrastructural development. Emphasising on the requirement of labour reforms, Mr Ansal said that those introduced in IT industry by Punjab can also be extended to other industries. |
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Pvt sector, govt networking mooted Chandigarh, September 14 The contribution of the secondary sector to the state GDP is 24.65 per cent, against 43.44 per cent of the agriculture sector and balance made up by the tertiary sector. Punjab has to search for answer how it can divert 15 per cent rural population to manufacturing related occupations through rapid industrialisation thus reducing dependence on agriculture and allied activities in the next 15 years. There may be difference of opinion on what the industry demands and suggests and what the government promises and claims, but it is time the two opted for net-working. Why not have an administrative set up within the government to process industry proposals ensuring clearance of applications in a time-bound period by adopting the British pattern on privatisation where all stakeholders investors, government and banks — jointly debate issues related to privatisation. The Friday inter-face between the PHD CCI and Industry and Mr Parkash Singh Badal further reinforces the need for better co-ordination for balanced development of Punjab. Interestingly of all the matters that concern captains of the industry, it is the unionism of truck operators that tops the
agenda. The discussion paper, based on guidelines provided by the chamber President, Sushil Ansal’s experience on business-government initiatives in more developed Asian countries, describes the problem faced by the industry due to truck unions as a ‘’nuisance’’. The unions do not allow hiring of trucks from the open market. The truck tariff is 30 per cent to 50 per cent higher than the open market rates. This renders good originating from Punjab as ‘’uncompetitive’’. The inter-face revolved around policy initiatives, amendments in the rules, evolving of an investor-friendly frame-work encompassing sound infrastructure, concessions and incentives, fast-track approvals and improvements in the existing system by introducing time-frame and identifying thrust areas to make agriculture and industry market-oriented by fully exploiting export potential of agri-business and food processing. Punjab, as per the official claims, has attracted an investment of Rs 1,939 crore for 135 large and medium units alone, while, work on setting up of 65 units involving an investment of Rs 2,345 crore is in the pipe-line. A total of 8,000 industrial units with an investment of over Rs 2,570 crore have been set up in the last four years. What, however, concerns the Chamber is the ‘’health’’ of industry. It is anything but robust. It requires proper attention and policies governing it, surgery. |
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SEBI asked to probe top gainers, losers New Delhi, September 14 There have been cases like the share price of a little known company like South Pole SE shooting up by 11,000 per cent during the bull run. There were other companies like Washington D, whose price went up by 9480 per cent or SComTec whose price shot up by 7300 per cent. JPC Chairman Prakash Mani Tripathi told newspersons here that there were sharp fluctuations in the prices of around 800 companies and SEBI had been asked to study the top hundred to 150 companies and the same number in the bottom rung. The direction came as the JPC heard SEBI Chairman D.R. Mehta and a string of senior officials of the regulatory body at its sitting here. It was also given a technical briefing by UTI officials, including the Chairman S. Damodaran. JPC queries to SEBI related to its regulatory work and the level at which it carried out surveillance of the stock markets. Members also wanted to know why SEBI failed to take suo motu action when the prices moved in a volatile manner. Mr Mehta informed the JPC that SEBI did not receive any complaint during the bull run and the regulatory body on its own had taken notice of the sharp fluctuations in prices and had warned the investors accordingly. It was also mentioned that the trend in the Indian stock markets were in tune with what was happening in the international markets. Mr Tripathi said the JPC had asked for details of the Dhanuka Committee report on market regulation submitted in 1997. SEBI’s deposition before the JPC was incomplete and it would be called later. In the technical briefing by UTI top brass, the JPC members referred to the several committees that had worked or were working on the various aspects of the mutual fund and felt further progress on the subject could take place only after they went through the various reports. |
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Sumitomo, Swaraj Mazda to launch vehicle
Chandigarh, September 14 This was conveyed by a high level delegation of the Japanese company to Parkash Singh Badal here today. The Japanese team informed the Chief Minister that its association with Punjab Tractors had been a very successful experience. They expressed happiness that after stressful years of 1983-1992, from the brink of financial disaster, Swaraj Mazda has achieved impressive financial turnaround and has become a dividend paying company. Over the years, Swaraj Mazda had sold more than 50,000 vehicles comprising medium and light range trucks, luxury buses, sophisticated ambulances. 4-wheel drive vehicles both to private customers and government agencies. The Chief Minister, while appreciating the venture a good step towards prosperity of Punjab, thanked the Japanese team for its support extended to the joint venture during the long difficult years. He also assured the team to help and support.
UNI |
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IBA chief Aaj Tak |
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