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Friday,
December 27, 2002, Chandigarh, India  
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Presidential
assent for UTI, SSI
continues to battle with inspector raj Oil-exploration
contract for India Moral
hazard behind fiscal changes |
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Hosiery
manufacturers consider imports Saudi
traders keen on joint ventures Polaris
meeting on Dec 30
US lottery
winner bags $ 315m
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Presidential assent for UTI, SEBI and 4 bills New Delhi, December 26 Presidential assent was also given to the Delhi Metro Railway (Operation and Maintenance) Bill, 2002, the Constitution (Schedule Castes) Orders (Second Amendment) Bill, 2002, the Consumer Protection (Amendment) Bill, 2002 and the Merchant Shipping (Amendment) Bill, 2002. With this, these six Bills passed during the Winter Session of Parliament have been notified in the Gazette of India as Act numbers 58, 59, 60, 61, 62 and 63 respectively of the year 2000, an official release said. The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002 which replaces an Ordinance promulgated earlier in October 2002, seeks to provide for transfer and vest the undertaking, excluding the specified undertakings of the UTI, to the specified company to be formed and registered under the Companies Act, 1956. It also seeks to transfer and vest the specified undertakings of the Unit Trust of India to the Administrator, besides repealing the UTI Act, 1963, in order to corporatise the UTI and let it compete in the free market economy, the added. The Securities and Exchange Board of India (Amendment) Act, 2002, which replaces and Ordinance promulgated in October, 2002, seeks to amend Securities and Exchanges Board of India Act, 1992. This is to be done by enlarging its Board of Directors, besides conferring powers of search and seizure with the approval of courts,
avoiding recurrence of scams and other malpractices in the capital market by building confidence of investors The Delhi Metro Railway (Operation and Maintenance) Act, 2002, which replaces an Ordinance promulgated in October, 2002, seeks to provide a legal frame and mechanism for regulation of the Delhi Metro Rail Corporation (DMRC). This is be done under the joint control of the Centre under the Ministry of Urban Development and the National Capital Territory of Delhi Government, on the pattern of Indian Railways Act, 1989. It also provides a mechanism for operation and maintenance of DMRC and its security. The Constitution (Scheduled Castes) Orders (Second Amendment) Act, 2002, seeks to amend the Constitution (Scheduled Caste) Orders, 1950, the Constitution (Scheduled Castes) (Union Territories) Orders, 1951, the Constitution (Jammu and Kashmir) Scheduled Castes Orders, 1956, the Constitution (Dadra and Nagar Haveli) Scheduled Castes Orders,1962 and the Constitution (Pondicherry) Scheduled Castes Orders, 1964.
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SSI continues to battle with inspector raj New Delhi, December 26 The sector, which contributes significantly to both GDP and exports, could not have however found a better
sympathiser than Prime Minister Atal Behari Vajpayee when he sought speedier liberalisation of SSIs from plethora of rules and regulations and made a case for bringing it at par with other segments of the industry for availing bank loans. “All enterprises -especially small and medium enterprises must be speedily liberated from the heavy burden of untenable constraints and hurdles they face,” Vajpayee said addressing a global seminar recently. Building a case for reducing the interest burden of the sector, Vajpayee said there was a need to change legal and administrative framework whereever necessary to bail out the SSI sector whose contribution to the economy was “truely big”. Despite these problems, the Tenth Five Year plan period has set an ambitious 12 per cent growth target for the SSI sector and estimated that the sector would generate 4.5 million jobs over the period. Though the sector has outperformed the industrial growth rate, the government policy initiatives particularly the move towards a comprehensive single legislation for the SSI, has not shown much progress. Similarly, much delayed legislations such as the Limited Partnership Act and the Factoring Services Act have not yet got the Finance Ministry’s nod. Though dereservation remains a contentious issue for the government, pruning of the reserved list continued with the dereservation of 51 items from the list which still contains 749 items. SSI Minister Vasundhara Raje has already indicated that her ministry is examining requests for dereservation or enhancement in investment limit for as many as 40-50 items. Hence, the forthcoming Union Budget is expected to contain announcements of more items being dereserved. In addition to the dereservation of items, the ministry has also cleared hike in investment limit to Rs 5 crore from Rs one crore earlier for over 15 items including sports goods,
pharmaceuticals and stationery products. A study by UNDP for the ministry on 15 dereserved items indicated that there has been no negative impact on the sector with exception of marginal impact in case of biscuits. As per official estimates, flow of credit to the sector as per percentage of net bank credit declined to 12.5 per cent in the first quarter this fiscal from 14.2 per cent in 2001.
PTI
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Oil-exploration contract for India New Delhi, December 26 A consortium of Indian companies signed an agreement with the National Iranian Oil Company in this regard in Teheran yesterday. The two sides have agreed to extend the four-year contract by another year if required. The consortium won the contract, beating stiff competition from the Reliance Industries and two European firms. The contract is the first step towards India’s involvement in the Iranian oil sector. The consortium comprises ONGC Videsh Ltd (OVL), two Indian Oil Corporation (IOC) and Oil India Limited (OIL). In the Farsi oilfield, OVL and IOC hold 40 per cent each, while 20 per cent is with OIL. According to the deal, the cost of exploration will not be paid in case the consortium fails to strike oil or gas. The Farsi oilfield, which already has two wells spewing oil, is estimated to have a hydrocarbon reserve equivalent to 500 million barrels of crude. It covers an area of 3,500 sq km at depths ranging between 20 and 90 metres. The deal would help in further consolidation of ties between the two countries, a spokesman for the Ministry of External Affairs said.
UNI
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Moral hazard behind fiscal changes BEHIND the quick changes in the financial sector, there is a moral hazard. Feeling cannot die down that mighty people have their way and punishment, if any, falls in the share of the weak. The issue deserves to be seen in perspective. The first question is how such huge NPs were built up. A critical analysis of the NPA shows that top 10 borrowers owe Rs 5,326 crore: top 25 (9,212); top 50 (12,934); top 100 (17,913) top 150 (21,447) and top 200 (24,000). The total figure of Rs 1,10,000 crore does not include the money locked in the steel industry. Bulk of the NPA is locked in state cooperative and units. The story of moral hazard can start from here. When the Steel industry was passing through a crisis situation, the RBI asked banks and other financial institutions to draw up a Corporate Debt Restructuring (CDR) plan for this sector. This is continuing despite the upswing. The total amount involved in CDR is Rs 45,000 crores. Accordingly, steel units were not included in NPA. Recently, the Deputy Chairman of the Planning Commission called a high-level meeting of banks, including the RBI. When the question of higher interest from SSI sector arose, banks were quick to say that out of 73 lakh defaulters, 63 lakhs were from SSI sector. When asked about the amount involved, it was just 19 per cent. This shows that high-ups are biased against the smaller segment. This is another moral hazard. Another interesting thing has come up on the NPA recovery issue. Big defaulters have found an antidot against the Securitisations Act. Maharashtra, Gujarat, Karnataka and the Rajasthan have a state law, which gives full protection against recovery. The Bombay Relief Undertaking (special protection) Act, 1958, and other similar state laws were enacted to prevent the loss of employment and give relief against unemployment. Defaulters in these states are running for cover. Then, most of the big defaulters are from these states. This is another moral hazard. The government has also brought the Companies Amendment Bill. It seeks to abolish BIFR and establish a National Company Law Tribunal. The Finance Minister’s promise of bringing lender’s bill is yet to be fulfilled. Why delay in this balancing Act? The Finance Ministry and the RBI should be a little cautious in view of the prevailing situation in the country. Some cases highlighted by the media are not enough. |
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Hosiery manufacturers consider imports Ludhiana, December 26 Sources in the hosiery industry said a few manufacturers had already finalised agreements with their Chinese counterparts. The sources attributed it to the fallout of the WTO regime, which came into force last year, leaving the country’s domestic market open for the foreign exporters. Mr Girish Kapoor of the Ludhiana Wool Syndicate said this might be in the initial stages but the trend could catch up in the city. He attributed this development to several factors. These included the opening of the domestic markets for the international manufacturers, “rigorous” tax regime in the country and the general “unfriendly economic atmosphere that is trapped between reform and tradition.” Domestic manufacturers feel that the Chinese products reach the local markets at a relatively lower price than the cost of domestic manufacturing. So importing these at a lower price is a better option for them. Mr Manoj Kumar Chopra, another manufacturer, said it was not only the WTO regime that was responsible for this situation. He said there was multi-level taxation in the country. First there was tax on raw material and then on the finished products. This reduced the margins for the manufacturers. “So why should they not explore other avenues?” he asked. Both manufacturers warned that this might not seem to be a serious problem at present, but eventually, it would have an adverse effect on the domestic industry. This would also lead to other related problems, like rise in unemployment and loss of foreign exchange. |
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Saudi traders keen on joint ventures New Delhi, December 26 At a meeting with the businessmen led by Mr Zaid Al-Bassam, Committee Chief, Jeddah Chamber of Commerce, Mr Jain, said in spite of the large potential for bilateral trade between India and Saudi Arabia, the actual trading levels were modest. Mr Bassam said India had developed sufficient expertise in setting up of small and in medium units and in this area, India could play a major role in Saudi Arabia. Setting up of joint ventures in pharmaceuticals, IT and food processing would benefit the two countries in identifying new markets for their products, he added. Areas in which India and Saudi Arbia can enhance business relations were readymade garments, chemicals, cosmetics, agri products, Mr Jain said. |
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Polaris meeting on Dec 30 New Delhi, December 26 He told PTI in an interview over telephone that “the company board will meet on December 30 and analyse the crisis, chalk out the next course of action. I will update the board on the incident.” Asked if the company had failed to meet delivery targets as accused by the bank, he said, “Yes, as per the schedule.”
PTI |
rc
US lottery winner bags $ 315m Washington, December 26 The spokesman gave no details of the winner of the Powerball lottery, which is played in 23 states, the US capital and the US Virgin Islands. The jackpot had been building up since October 31. However, CNN said the single winning ticket was sold in the town of Hurricane — population 4,500. After a hectic Christmas-Day in which thousands of last minute players bought numbers, the draw in West Des Moines, Iowa yesterday came up with the winning numbers: 5, 14, 16, 29, 53 and Powerball 7.
AFP
New Delhi: ‘Vastu’, the Indian style of architecture, has gone the “neem and turmeric” way with its patenting in a foreign country. Noted Vastu architect A.K. Bansal claims that Vastu is now a registered trademark in Germany, and as per the World Trade Organisation (WTO) regime, the word “vastu” cannot be used in any commercial venture once it is registered. Mr Bansal cites the case of a German Vastu scholar, Marcus Schmieke, who started an institute in 1995 by the name of “Vastu Academy” to teach Vastushastra to German students. But he was taken to the court where he had to apologise for using the word and change Vastu to ‘Vasati’.
UNI
Indo-German trade to touch 22,000 cr New Delhi:
The Indo-German bilateral trade is expected to touch five billion Euros or approximately Rs 22,000 crore during the current year (January-December) with India enjoying trade surplus. Indo-German Export Promotion (IGEP) Project Director D Kebschull (IGEP) said with the strengthening of Euro against the dollar in recent days, the growth rate of India’s exports to Germany is just one per cent while imports from Germany increased by 3 per cent.
UNI
Controlling pain during childbirth Coimbatore:
International healthcare major, BOC Medical, is launching tomorrow its new premixed gas mixture, used for pain relief during childbirth, in India. BOC India Ltd, National Sales Manager, Shekhar Trivedi, told reporters here that the product, ‘Entonox’, also finds applications in pain relief in other fields like dentistry and wound dressing.
PTI
Bajaj Elec okays 1:1 rights issue Mumbai:
Bajaj Electricals Ltd (BEL) board has approved a proposal to issue equity shares on rights basis to existing shareholders in the ratio of 1:1 for Rs 25 per share, Rs 15 being premium per share having face value Rs 10. The board gave its nod for issuing 43,21,440 shares on rights basis at Rs 25, aggregating premium of Rs 6.48 crore, at its meeting held on December 24.
PTI |
bb
Spice Quicky Tata AIG Radial tyres Nasscom BHEL bags order Ranbaxy |
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