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Wednesday,
February 5, 2003, Chandigarh, India   
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Centre
to simplify investment rules Bharti
gets $315 m loan HAL likely
to work with Airbus Govt
befools transporters |
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Basic
operators oppose CPP regime Milkfed,
farm dept lock horns Decision
on Exim form opposed
RIL gets
licence for 9 oil blocks
Corporation
Bank best bet
HDFC
cuts interest rates
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Centre to simplify investment rules New Delhi, February 4 A comprehensive review of procedures was undertaken by the government yesterday with Atal Behari Vajpayee chairing a meeting with ministers of key economic portfolio. The meeting was attended by Finance Minister Jaswant Singh, External Affairs Minister Yashwant Sinha, Commerce and Industry Minister Arun Jaitley, Petroleum Minister Ram Naik,
Disinvestment and Telecom Minister Arun Shourie, Coal Minister Karia Munda, Minister of State for Petroleum Santosh Gangwar and Deputy Chairperson of Planning Commission K.C. Pant. Among other things, the meeting took note of the recommendations made by a specially constituted committee on simplification of procedures relating to implementation of projects. At present, a typical medium-sized company has to deal with 27 inspectors from different departments of the Central and state governments and maintain as many 42 forms and returns. There are 25 laws to comply with on labour-related issues alone. In addition, details of attendance and payment have to be maintained under seven different laws. “This will, however, soon change with the overhauling of procedures relating to implementation of projects”, an official statement said. The committee had suggested that reengineering of the procedures will bring as many cases as possible under “self-regulation” or “professional outsourcing”. Only cases related with safety, security and strategic considerations are envisaged as requiring prior case-by-case approval by public agencies. The committee has also recommended investment faciliation through handholding and problem solving by the Industrial Investment Facilitation Board. At present, the Foreign Investment Implementation Authority is extending such support to foreign investors. The recommendations have already been taken up for implementation in 21 ministries and departments
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Bharti gets $315 m loan New Delhi, February 4 The funding has been arranged at an approximate spread of 160 basis points over London Inter-bank overnight rate (LIBOR) and the foreign currency risk has been fully hedged. The current overall cost is approximately 5.5 per cent per annum, including end-to-end costs such as foreign currency hedge cost. The average funding has an average tenure of over five years. The funding is structured in such a way that $125 million has been raised as syndication loan from a consortium of banks with a door-to-door maturity of six years. Another $160.2 million has been arranged as buyer credit facility with Export Kredit Namnden, Sweden, acting as the Export Credit Agency. The lender of facility is ABN Amro Bank involving a door-to-door maturity of 10 years and disbursement of the loan is linked to equipment supplies from Ericsson. Another $30 million loan was raised from Nordic Investment Bank, a multi-lateral agency with a maturity of eight years.
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HAL likely to work with Airbus New Delhi, February 4 HAL has made bids for some of the work packages for the aircraft which will actually be the second level of sub-contracting of the massive project. The aircraft is finally expected to enter the commercial flying sector by 2006 after one year of test flying. HAL, which already makes doors for the A-320 aircraft, is expected to gain from these sub contracts specially as it is also planning to get into the business of manufacturing commercial planes. Dr Kiran Rao, Airbus Vice-President of Sales for India and sub-Saharan Africa, told reporters here today that Infosys was already working on the design of the wing for the double-decker A-380 with Airbus, the UK. Without elaborating on what work packages were being offered to HAL, he said the PSU would be involved in the work that was sub-contracted by those who had been given level one contracts. The design of the A-380, which will be able to fly non-stop for 8,000 nautical miles, was completed last year and trial runs will begin in 2005. Already, the plane has received 103 orders.
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Govt befools transporters Ludhiana, February 4 According to Mr Fateh Singh Libra, spokesman of the Punjab Bus Operators Association, the running cost of the buses have increased many folds during the last four years, while the bus fare has increased by only four paisa. He pointed out, like diesel which was selling for Rs 9.68 per litter in 1999, is now selling at Rs 19.41 per litter. He said, a bus covers 3 km with one litter of diesel and it was not possible for them to operate their buses at this fare. While earlier the running cost of the diesel per km was Rs 3 only, now it has come to Rs 6 per km. Mr Libra said, currently the bus fare per km is 42 paisa, while in 1999
the fare was 39 paisa per km. While the bus fare has not increased much, the running cost of the buses has increased more than two fold. This, he said, was due to the heavy increase in the rate of diesel, bus chasis, spar e parts, bus adda fees and toll tax recently imposed on National Highway number 1. He disclosed tat at present the total running cost of one bus is Rs 15 per km against the average income of Rs 12 per km. He regretted, while the bus operators, who count among the major tax payers to the state, had great expectations from the government, but they feel let down by the recent increase. He said, the bus operators feel that they have been cheated with this increase. He pointed out, the one paisa per km increase does not mean much as there will not be any increase in the fare on the short routes up to 20 km. Mr Libra said, it had been brought to the notice of the government that the illegal carrying of passengers by the trucks, tempos and Tata Sumos was hitting hard the bus industry.
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Basic operators oppose CPP regime New Delhi, February 4 Terming the regime as anti consumer, the association, in a letter to TRAI, has pointed out that the introduction of such a regime will penalise the 4 crore fixed line phone subscribers. “The key demands of the cellular industry for CPP were driven only to seek exemption from payment of any access charge (that they paid to the basic industry)”, Mr SC Khanna, Secretary-General of the association said. Cellular subscribers in the country are less than one-fourth compared to of fixed line phone subscribers, Mr Khanna said, talking to TNS, adding that the CPP regime introduction would only have a penalising effect on the fixed line phone subscribers. The contention that the CPP regime would increase mobile phone penetration in the country is absolutely false because the growth of the cellular industry is already 100 per cent, he said. The association, said it’s the 100 per cent year on year growth of the cellular industry and increasing competition, which had forced the cellular operators to reduce tariffs.
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Milkfed, farm dept lock horns
Ropar February 4 Sources told this correspondent that the Agriculture Department of the state had started demanding Rs 5,000 per acre per annum against the existing amount of Rs 30 per acre as lease money from Milkfed, which was running its Bet farm on the 200 acre. The Milkfed authorities have, however, expressed their inability to pay the amount. They had, instead, proposed that they could give Rs 500 per acre per annum. The authorities at the farm who spoke on the condition of anonymity, said if the department failed to reduce the proposed lease amount of Rs 5,000, Milkfed might also be forced to wind up its operations here.
OC
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Decision on Exim form opposed Jalandhar, February 4 PHAGWARA: Over two dozen industrial and trade organisations today declared to hold a protest march tomorrow in protest against anti-industry policies of government. The decision was taken this evening in meeting of these bodies.
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RIL gets licence for 9 oil blocks
New Delhi, February 4 The ONGC signed production sharing contract (PSC) for 13 blocks while RIL, in consortium with Hardy Oil of the UK, inked agreements for nine blocks, including seven prime deepwater blocks. Minimum committed investment in the first exploratory phase in 23 blocks, agreements for which were signed today, would be around $ 415 million, Petroleum Minister Ram Naik said. A total of $ 1.05 billion investment has been committed in three phases of exploration and production in all 23 blocks, he said. The ONGC on its part inked PSC for nine blocks. It was joint signatory with Oil India Ltd for three blocks while for the remaining one block it signed agreement with Indian Oil Corporation. The Gujarat State Petroleum Corporation (GSPC), in consortium with Geo Global Resources (India) Ltd and Jubiliant Enpro India Ltd, was the third successful company, with signed contract for the KG-OSN-2001/3 offshore blocks in Krishna Godavari Basin. Naik said the fourth round of NELP would be announced by first week of April. Under NELP-I, of the $ 1.1 billion investment committed under NELP-I, $ 423 million has already been invested while of the $ 775 million committed in NELP-II $ 111 million has been invested in exploration. Ind-Swift buys back
23 pc PSIDC shares
Ind-Swift Ltd has completed the buyback of 23.14 per cent shares held by the Punjab State Industrial Development Corporation (PSIDC) in its group company, Ind-Swift Laboratories Ltd (ISLL) involving a total amount of Rs 8.20 crore. With this buyback, the Chandigarh-based pharmaceutical major, has completed the first phase of consolidation. Its stake in ISLL has now risen from 20 per cent to 44 per cent. Recently, Ind-Swift Ltd had announced the merger of the two group companies Mukur Pharmaceutical Company Pvt Ltd and Swift Formulations Pvt Ltd with itself. “Consolidation will help us focus our energies better post-2005 when patents become vital for survival,” Ind-Swift Director V.K. Mehta said in a statement here today.
Arvind Remedies
net up 33 pc
Arvind Remedies net profit has increased by 33 per cent to Rs 87.35 lakh from Rs 65.46 lakh during the third quarter ended December 2002. Operating profit, at Rs 2.43 crore, has reported a jump of 60 per cent from Rs 1.52 crore. For the nine-month period ended December, 2002, the company’s income from operations have risen by 43 per cent to Rs 94.96 crore as compared to Rs 66.28 crore in the corresponding previous period. Despite higher interest cost the gross profit at Rs 4.53 crore has registered a 22 per cent increase during the period.
Agencies
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by Ashok Kumar Corporation Bank best bet
With the banking sector looking up in recent times, the benchmark has been private sector banks, due to their strong growth rates. Among the few public sector banks that have attempted to match up to their standards has been Corporation Bank, which has continuously taken strides over the past few years to improve performance, in line with the private players. The bank has been able to outperform the industry in the last five years and has set aggressive targets for the next five: achieving business volume of Rs 700 bn, along with a compounded annual growth rate (CAGR) of 23 per cent in net profits, by 2006. With a view to improving its fee-based income, Corporation Bank entered into a strategic alliance with LIC, as its corporate agent for marketing insurance products. The tie-up has been sealed with LIC taking a 27 per cent stake in the bank. Corporation Bank was originally incorporated in 1906 under the name of Canara Banking Corporation. It was one of the six private banks to be nationalised in the second round of nationalisation in 1980. During the 15-year period before nationalisation, from 1966 to 1980, its deposits grew by nearly 15 times to Rs 307.94 cr. The bank has maintained its consistent growth performance even after nationalisation. In 1994, the government recapitalised it to the extent of Rs 45 cr. In October 1997, Corporation Bank successfully came out with an IPO at a price of Rs.80 (including premium of Rs.70) per share. Corporation Bank is one of the few PSU banks to have been granted operational freedom. The bank, headquartered at Mangalore in Karnataka, is today one of the fastest growing and nimble PSU banks. It operates a network of 652 branch offices spread over 21 states and two Union Territories of India. The bank has to its credit introduction of many new products in the Indian banking sector. It was one of the first to commence gold trading on it being opened for banks in FY98. It is also the leader in Cash Management Services, a product, which the company pioneered along with Citibank. Before looking at the factors that have led to its success story, let us look at some of the weaknesses and threats pertaining to this bank. In the present day, technology is seen not only as a means to reduce costs but also as a valuable resource to enhance customer convenience. Although it has automated around 90 per cent of its branches, they are still in the process of getting networked. However, it is getting aggressive on implementing its tech platform. The geographical reach of Corporation Bank is relatively limited. 61 per cent of the bank’s branches are located in the southern region. However, the bank’s tie-ups with LIC and New India Assurance would help it in widening its reach into North and East India where it has limited presence. Notwithstanding these negatives, Corporation Bank ranks among the best bets from this sector, and next week, we shall see, exactly why. |
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