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Tuesday,
October 15, 2002, Chandigarh, India  
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Cotton output falls
EPF tug of war continues
Introduce ‘voluntary disclosure scheme’
UK told to open up public services
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War on Iraq to shoot up oil prices Paracetamol not good for liver
Ashok Leyland sales rise 21.4 pc
Graphic: State of the Indian economy
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Cotton output falls Kotkapura, October 14 Information gathered by TNS revealed that in 1992-93, this Asia’s biggest cotton market received more than 4 lakh bales of cotton in a single season. In the current season, cotton traders, ginning and pressing mill owners and commission agents are expecting the arrival of only 50,000 bales only. “It was next to impossible to find any vacant patch in the grain market a few years ago almost all space used to be occupied with the cotton heaps. Now the trend has been reversed as heaps of cotton crop have become a rarity,” said Mr Baljinder Singh, a commission agent while talking to TNS today. Mr Raj Kumar, a trader, who has been in the cotton business for the past 25 years, pointed out that over the years, the water table came up rendered the area unfit for cotton cultivation. Farmers took up the paddy cultivation in a big way and slowly, the cotton was replaced by paddy. Apart from it, the repeated attacks of bollworm and other diseases on the cotton plants also forced the farmers to shift to other crops. As the improved cotton seeds were now available in the market and the water table had gone down again, the traders were expecting that next year the area under cotton cultivation would take a jump. Now only three cotton ginning and pressing mills were functioning against the 40 mills a few years ago. Mr Ashok Kapur, President, the Northern India Cotton Association (NICA), said up to September 30 the total arrival of cotton in Punjab was 20,000 bales against the arrival of 60,000 bales in the corresponding period last year. Traders, brokers and industrialists were surprised over the less arrival of cotton in the market despite the fact the good production of cotton was expected this year. Buyers from Mumbai and southern states were yet to enter the Punjab markets for purchasing their stocks. The prices of cotton were ranging between Rs 1,800 and Rs 2,100 per quintal.
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EPF tug of war continues
New Delhi, October 14 Finance Ministry, which continued to pressurise the Labour Ministry to lower interest rate on EPF by 0.5 per cent, said 9.5 per cent interest was not affordable as the fund has invested 80 per cent of its Rs.104,000 crore total assets in Special Deposit Scheme (SDS) which was paying only 9 per cent interest. In such a scenario, the Finance Ministry was of the view that the fund would not be able to sustain 9.5 per cent interest rate as it would amount to eating into its surplus which is put at Rs 400 crore. Though Labour Ministry maintained that it could afford 9.5 per cent this year as it had enough reserves, Finance Ministry felt that it would be unwise to dip into their surplus meant for taking care of exigencies and not for frittering it away by paying high interest rate which was not being earned through investments. A senior Labour Ministry official discounted the fears that the fund should move towards debt trap due to any default of interest payment on EPF investments, saying most of the investments had been made in State Government Bonds which were safe and money could be recovered. Labour Ministry sources confirmed that a Mumbai-based pressure group representing companies and debt brokers has warned the Ministry that several provident fund could head towards serious debt trap due to potential defaults in bonds guaranteed by various state governments. Seven states have already defaulted in interest payments and more could follow, they cautioned the Centre. Besides, the crisis-ridden Industrial Finance Corporation of India (IFCI) has already defaulted to the tune of Rs.220 crore mostly in interest payment on investments by EPF since November last. Punjab State Industrial Development Corporation has defaulted to EPF of Rs 5 crore. The poor financial health of Financial Institutions (FIs) has forced EPF to approach the Central Government to amend investment norms to enable it to park the money in some of the good private sector instruments. Labour Ministry officials are, however, not very much inclined to invest in private sector instruments citing the example of State Electricity Boards which owe lot of money to NTPC and yet the central power generating company was not stopping flow of power to the defaulting states.
PTI
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Introduce ‘voluntary disclosure scheme’ THE apparent misrule of the last government in Punjab has left the state bankrupt no doubt. But the erstwhile ruler did everything in his power to keep people happy and loyal. Rampant corruption, arbitrary appointments, over employment, free sops to farmers and backward classes, patronising government officials with plum postings, improved emoluments, and religious indulgences. Further the liberalisation process pushed “debt-based buying” bolstering people’s purchasing power. Funds, short-term appeasement of the people and feel-good factors were all he needed for the next elections and not the treasury — or so he thought. So the treasury went down while the black economy went up. With his background if the present ruler wants to pull the state out of the red, the one sure thing he has to do is to revert the transformation of its economy again from black to white. As of today even if 50 per cent of the black economy could be converted into white with “glasnost” or policies of “openness” he proffered during his election speeches, the treasury would be out of trouble. The Centre has already shown precedence in the matter of income-tax by implementing a VDS which has yielded magnificent returns. The other day there was a mention about the Amritsar municipal corporation planning a VDS for building bylaws defaulters. Similarly, rather than going after the spoils of the last government and trying to turn the clock back, would it not be more practical to study the actual market pattern that has developed, and follow it by VDSs by various departments? This would decrease the gap between market values and practices, and government records and procedures. A simple example of this is that at present a property actually worth Rs 10 lakh in the market is under-registered at Rs 5 lakh because of high registration rates. And nearly the whole of Punjab indulges in this practice, even by paying bribes to revenue officials. Now for one, if a VDS in this case is implemented, guaranteeing lower rates so that the money to be paid by the registrant remains almost the same, the white capital formation of the people would double. This would thereby double their capacity to take loans on it. Further doubling their working capital, improving their turnover and profits, resulting in higher tax collections. These VDSs will improve volumes with time and even though the rates are low, revenue will increase. With more expendable capital in hand the existing business will expand. New enterprises and private employment will get a boost. The legitimate economy will thrive. We are like a family whose members are guilty of stealing from the common fund and are keeping the truth from coming out in the open, while knowing that the truth is known to all. This is keeping us from prospering in a clean and organised way. We will have to let go of this guilt by changing the laws according to the prevalent truth. People cannot be held totally accountable for the mess we are in as they too had to manage their affairs according to the official and unofficial policies of the last government. Even if partially responsible, they deserve amnesty if such VDSs are supported by them. This will give them a chance to come out of the black. The black economy ruins not only directly but also by its many side effects. People trying to evade taxes end up showing underrated properties and meagre sources of income. This forces them to indulge in theft of various services provided by public utilities not only for the obvious reason but also to keep their bills (which become a valid proof of expenditure) within their sources of declared income. This is usually done in connivance with the relevant officials who receive a share of the unrecorded amount. The money, which should have been used for development purposes or for further renovation, upgradation and maintenance of the equipment of public utilities, goes into the black world. What could have yielded interest even in banks, then lies buried unaccounted for in somebody’s coffers or bank lockers or even in beds, walls etc as has been evident lately. At worst it is sent abroad through “hawala” and other fraudulent channels that have evolved. This proves even more fatal for the state as it enables the foreign mafia and other unscrupulous agencies to make a financial stronghold in the region, thus helping them fund damaging, illegal and even anti-national activities. Besides VDSs will also serve as an appeal to the common people to voluntarily help improve the state’s economy rather than through coercion. The use of force would either cause agitation and instability to this government or inflate the black economy further by making more opportunities for bribing police, tax and investigating officials.
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UK told to open up public services London, October 14 Sensitive areas that multinationals are keen to break into include the health and education sectors. A government consultation report released last week says the UK faces demands to ‘remove all establishment restrictions on hospital and social services, rest, convalescent and old people’s homes’. Other demands include the removal of distinctions between postal and courier services and calls for Britain to end subsidies to broadcasting organisations. This could have massive implications for the BBC. There are growing concerns that Gats will lead to the full-scale privatisation of public monopolies across the world. Barry Coates, director of the World Development Movement, said: ‘Decisions now on public services in many cases are guided by active public debate. “This can change policy. Under Gats, commitments are irrevocable. Countries will be locked in, which is incompatible with democracy.” Howard Catton, senior policy adviser at the Royal College of Nursing in London, said: ‘If services are opened up so that the private sector can provide them, that means the NHS (National Health Service) may look at what it provides and the implications this has for risk pooling and the principles behind the NHS come into question.’ Formal offers for liberalisation between countries will begin in March next year. Organisations have until January to submit responses to the UK Department of Trade and Industry. The treaty covers all services for water, energy, telecoms to financial. The services sector contributes 70 per cent of the UK Gross Domestic Product and employs 23 million people.
The Guardian
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War on Iraq to shoot up oil prices
Abu Dhabi, October 14 Sounding a warning on increasing tensions in the region UAE Petroleum and Mineral Resources Minister Obeid Bin Saif Al Nassiri said here yesterday that crude oil prices are likely to rise if political tensions in the region continue to deteriorate. Sharing his sentiment at the opening of 10th Abu Dhabi International Petroleum Exhibition and Conference, ADIPEC 2002, here yesterday, the Algerian Oil Minister Chekib Khalil said Crude oil prices could skyrocket if the US attacks Iraq. “The level of oil prices will hang on the extent of damage to Iraqi oil facilities and shortage of oil supplies in world oil market,” Khalil said in an interview to Emirates News Agency, WAM. Al Nassiri told the conference attended by oil ministers from the Organisation of Petroleum Exporting Countries and top industry officials that recent developments had already affected oil markets and sent prices upwards. “Crude oil is currently selling at a premium of over five dollars a barrel due to political tensions and it is poised to increase if the situation deteriorates,” the UAE Petroleum Minister told the opening session of the conference. Al Nassiri pointed out that the oil markets had sustained relative stability in the past few months. “OPEC crude basket is now selling at about $ 28 a barrel, while the annual price rate per barrel since the advent of the year till now had topped $ 23.7, that is slightly more than the price last ear, which was $ 23.1 per barrel.” The forecasts at the conference could be very worrying to India, one of the world’s largest importer of oil and gas as another price hike could slow down the growth of its economy and put a brake on its automobile sector. He, however, assured that OPEC in conjunction with other producers, would be ready to meet any shortages in oil supplies in the event of an outbreak of war in the region. Expressing hope that the current stand-off would not lead to a military confrontation, he said, “It is our hope that the current stand-off between Washington and Baghdad would not degenerate into a military confrontation.”
PTI
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Paracetamol not good for liver New Delhi, October 14 This has been recommended to try and reduce the number of deaths that have occurred in the recent times from the overdose of Paracetamol. The deaths occurring from overdose have raised major concerns in the USA and the UK. Even in this country the recent reports of toxicity are pointing a finger at the side effects of the drug on liver. Paracetamol has been a popular drug which has been available also as an OTC product for fever and pain. The lack of knowledge on the part of patient on the side effects makes it dangerous for him to consume the drug. And with no explicit warning on the packs of these drugs, it is putting the patient under severe risk pertaining to toxicity. There has been no lesson learnt by us on the use of this kind of drug and putting a large per cent of population under the threat of severe side-effects of the drug. The overdose association with acetaminophen (Paracetamol) every year results in more than 56,000 emergency departments' visits, including 26,000 hospitalisations, and more than 400 deaths in the USA alone, according to “Scrip”. The USA is following the UK and some other countries which have introduced measures to restrict the numbers of tablets per pack and replacing bottles full of loose pills with "blister packs". A US advisory panel has recommended that explicit warnings about the possibility of liver toxicity should be added to all packs of OTC products containing acetaminophen. The US FDA's non-prescription drugs advisory committee which met recently to review the safety of several OTC analgesics, starting with acetaminophen, has said all OTC products in which Paracetamol is an active ingredient —cough cold medicines — should clearly state this on the front of the pack. This step has been taken after there has been reports of several cases in which patient has suffered from hepatotoxicity after consuming
Paracetamol.
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Industrial census Larsen & Toubro Arvind Mills |
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