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Tuesday,
December 10, 2002, Chandigarh, India  
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RBI draws blueprint to streamline NBFCs Kelkar: tax exemptions jack up interest rates Oswal: China poses challenge
Fund to help tea, coffee growers |
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Banks biggest market for hardware firms ‘Make employment a right’
RJD: Hotel Ashoka in Gaya disinvested at throwaway price
Core Group of Secretaries to decide selloff
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RBI draws blueprint to streamline NBFCs Chandigarh, December 9 Officials of the RBI say that these companies, spread all over Punjab, especially in Jalandhar, Ludhiana and Amritsar, have been directed to repay the deposits taken from public, worth crores of rupees within three years’ of the date of cancellation of their
registration. Otherwise, warned the bank, they would be persecuted as per the Act. It has already initiated legal action against over half a dozen companies, involved in financial operations in violation of the Act. Mr Madan Lal, Regional Director, RBI, says, the bank has now decided to monitor the NBFCs on monthly basis. After rejecting 1,112 applications out of 1,671 NFCs, it has granted registration to only about 550 companies. He said: “RBI is making efforts to streamline the activities of the NFCs, which have a major role in the financial market. We have registered 140 companies under ‘A’ category — authorised to accept deposits for 12 to 60 months at the maximum rate of 12.5 per cent and 403 companies under ‘B’ category — authorised for hire, purchase and leasing activities but not to accept deposits.” Mr Ashok Syal, General Secretary, Punjab and Haryana NBFCs Association, admitted that a section of the companies might be engaged in the exploitation of public, but the registered companies would have to work now like other commercial banks. However, Dr L.S. Sharma, DGM, RBI, felt that these companies were dealing with a small share of the credit and deposits in market. They were dealing within a small area and known group of depositors and borrowers. So at this stage there was no need to extend the provisions of the Act. Because of lower administrative costs and other expenses, he said, they were able to cater to a segment in the market.
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Kelkar: tax exemptions jack up interest rates
Mumbai, December 9 Kelkar, author of reports on reforming direct and indirect tax structure, said the complex tax regime involving many rates and sops have raised the cost of capital and doing business in the country. The tax compliance was low, affecting the revenue generation. The Indian economy was facing stressful fiscal situation with combined deficit of centre and states running into double digit, Kelkar said addressing a seminar on capital market organised by the CII here. The investment flows have declined while economy has seen current account surplus situation, Kelkar said “Besides the cost of fund, industrial activity and exports was also adversely affected by high transaction costs. They were as high as 8 per cent for textile sector, affecting the country’s exports”, he added. The economy can save Rs 5,000 crore annually through reforming systems and reduction in transaction costs, he said. The panel recommendations to simplify regime were part of efforts to make policy formation transparent and increase tax payers’ participation in this year’s fiscal policy making, he said. Both task forces would work on the feedback received from the industry in the next 15 days and present revised reports to Union Finance Minister Jaswant Singh, Kelkar said.
PTI
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Oswal: China poses challenge Ludhiana, December 9 This observation was made by Mr S.P. Oswal, Chairman, the National Textile Committee of the CII and Chairman, the Vardhaman group. Mr S.P. Oswal accompanied by Mr D.L. Sharma, Executive Director, Mahavir Spinning Mills, visited China to study the development of the cotton textile industry in China and its impact on the textile industry of India. Mr Oswal told in an exclusive interview that the pace of industrial development in China was higher by at least about 2 times compared with the growth rate of India. China has maintained the growth rate between 9.9 per cent to 10.9 per cent during 2000 and 2001. The export of Chinese goods have touched $ 266.20 billion by 2001 and the foreign exchange reserves were to the tune of $ 212.20 billion. China has achieved an export growth of over 15 per cent fuelled by the textile sector. China’s textile industry is targeting to achieve 40 per cent share in the world trade in textiles. The share of production of textile material in China in the total world production has grown from 11 per cent in 1980 to 22 per cent by 2000. Mr Oswal observed that China is witnessing fast privatisation of the industries. The process for privatisation started some five years ago. Mr D.L. Sharma disclosed that there was no industrial unrest at all in China and nor there was any increase in the wages for the last many years. Japan has made a significant contribution in the growth of China as a big industrial power of the world. More than 40 per cent of the export from China was from joint ventures companies established through foreign direct investments. Almost 85 per cent import of garments to Japan was imported from China. China’s export of garments to Japan was exceeding $ 17 billion. Mr Oswal pointed out that the labour laws in India were stringent as compared with China. No protection was granted to a labour in China and on an average a Chinese labourer earned 600 to 700 RMB (Chinese currency) which comes to about Rs 5,000 per month plus housing and some other social security benefits. China was the highest cotton producers in the world and this year the cotton production is likely to touch 5 million tonnes. The prices of Chinese cotton are slightly lower than the international prices giving advantage to spinning mills.
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Fund to help tea, coffee growers New Delhi, December 9 The operational modalities of this scheme have already been worked out by an inter-ministerial committee which had non-government experts as well. Stating this in response to the calling attention motion on the crisis in the plantation sector (tea, coffee and rubber) and the steps taken by the government, Arun Shourie assured the House that the scheme will be implemented at the earliest. The prices of commodities in the international market have been depressed in the recent
years." This has had its effect on these commodities produced and exported by India. The domestic prices of coffee, tea and natural rubber have a tendency to move more or less in tandem with the international prices,” the minister said. Mr Shourie said the world prices of tea peaked in 1997 but began to register a steady decline after 1999. There was a 26 per cent decline in world prices of tea in 2001 compared to the peak level price of 189 cents per kg in 1997. “The decline in international prices, coupled with problems like decreasing exports and the low rate of growth in domestic demand
adversely affected domestic prices of tea which declined from Rs 72.79 per kg in 1999 to Rs 61.66 kg in 2001. The average price for the first quarter of 2002 is Rs 47.62 per kg,'' he said. Talking about the prices of coffee and natural rubber, the minister said that the situation in the last two years has been unfavourable to the coffee
growers in India and major producing countries as Brazil, Columbia, Indosnesia and countries in Africa. He said that prices of natural rubber have begun to recover in the domestic and international market from the middle of this year. Mr Shourie said that the continuous fall in
prices of tea and coffee, coupled with high cost of production, has adversely
affected the economy of the plantations, resulting in some tea and coffee plantations being abandoned or under lock-out in Assam, Kerala and West Bengal. He said that the government proposes to appoint an experts committee to do an in-depth study of the gardens in each state and suggest a package of
measures for their viability and revival. In his reply to clarifications sought by members, the minister did not express any concern over the reported deplorable condition of plantation workers and women employees.
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Banks biggest market for hardware firms Chandigarh, December 9 Talking to The Tribune here today, Mr Vyas said D-Link is the only networking hardware company which is manufacturing NICs, HUBs, switches, structured cabling and modems in India . The company has recently expanded its product range into newer segments like Voice over Internet Protocol (VoIP), firewalls and motherboards. The company is now focussing on latest innovations like layer3 technology, wireless systems and security features like firewalls and storage technologies. Among its major clients are the RBI, the SBI, ICICI, Bank of India, IIT (Kanpur) besides several other technical institutions. Mr Vyas says at present the networking hardware industry in India is worth Rs 2,500 crore with a projected growth rate of 10 to 25 per cent per annum. “In fact for the past two years, the growth rate has been more than 40 per cent per annum. But because of slowing down of the economy, it fell considerably in the first half of the current year but has started showing upward trend again,” says he. D-Link, he claims, has expertise in LAN, WAN and convergence technologies. Talking about the networking problems peculiar to India because of inadequacy of services provided by various agencies, including telecommunication lines, he says a special R&D wing is working at Bangalore to provide networking solutions peculiar to the country. Later Mr Vyas addressed a seminar on Netvision 2003 and informed participants about emerging technologies through live demonstrations of equipment and its applications.
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‘Make employment a right’
New Delhi, December 9 In a voluminous document “The India Vision 2020”, the commission says given political will the goal of full employment is certainly achievable. India needs to generate more than 160 million additional employment opportunities over the next 20 years. At the same time, the total proportion of the workforce involved in agriculture is likely to decline from 56 per cent to 40 per cent or even lower, thus increasing the pressure for rapid multiplication of non-farm employment opportunities. “India’s vision for 2020 must be founded on the premise of jobs for all. Employment must be considered a constitutional right of every citizen, backed by the full commitment of the government’’, the document says. The compounded effect of achieving the targeted annual GDP growth rate of 8.5 per cent to nine per cent over the next 20 years will result in quadrupling of the real per capita income and almost eliminating the percentage of Indians living below the poverty line. ‘’This is a very real possibility for us to seize upon’’, the document prepared under the guidance of Dr S.P. Gupta, Member, Planning Commission, says. With population growth slowing now to about 1.6 per cent per annum, a growth rate of the GDP of around 9 per cent per annum will be sufficient to quadruple the per capita income by 2020. Assuming that India achieves quadrupling of per capita income by 2020, it will attain a level of development far higher where China is today, and on par with upper middle income countries (UMI) such as Argentina, Chile, Hungry, Mexico and South Africa, the document says. ‘’Employment or livelihood security becomes an essential and inseparable component of a comprehensive strategy for national food security and must be considered as one of the nations highest priorities,’’ Vision 2020 says. ‘’Access to employment is an essential component of freedom of economic choice.’’ India’s objective for 2020 must not only be to produce the food its population requires but also fully exploit the comparative advantages it has — agro-climatic variety, irrigation, scientific capabilities and low labour cost — to become a low-cost, high-profit producer for the world market. Dr Gupta, a well-known economist, is the author of several important reports, including on the small-scale industry and employment. The document shows that employment in the registered SSI sector has nearly tripled over the past 20 years. A repetition of this performance will generate an additional 36 million jobs over the next 20 years. By far, the largest number of new jobs will be in the services sector. By 2020 more than 120 to 130 million jobs will come from the services sector alone. Development of the country’s tourism infrastructure can generate more than 20 million additional employment opportunities, in tourist-related businesses within a decade. As the application of information technology spreads and encompasses traditional industries, it can create new employment opportunities 10 times greater in number than those directly involved in the core IT industries, the document says.
UNI
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RJD: Hotel Ashoka in Gaya disinvested at throwaway price New Delhi, December 9 RJD leader Raghuvansh Prasad Singh said in the Lok Sabha that Hotel Ashoka in Gaya was being disinvested at Rs 2.01 crore which was far below than the reported market value of Rs 100 crore with consultation with the state government. He said that it was surprising that the Centre did not consult the state government despite the fact that the hotel was located in a seven acre plot of land belonging to the state government. The RJD threatened to launch an agitation if the deal to sell it off was not withdrawn. He also questioned the removal of former CMD of ITDC from the helm of affairs and said that Mr Lohani was doing extremely well and had brought the hotel to a profit-making stage. It was only because he was opposed to the policy of disinvestment that he was removed from the post.
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Core Group of Secretaries to decide selloff New Delhi, December 9 Expressing hope that concerns raised by his Ministry will be addressed by the Group of Secretaries, Mr Naik said: “I believe that public sector oil companies like ONGC and GAIL will be allowed to bid for HPCL as no bar has been imposed on them”. He said that only those PSUs will be allowed to bid which has sought the permission of the Petroleum Ministry.
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Ficci session
New Delhi, December 9 |
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MARKET GOSSIP
— Ashok Kumar |
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