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Market mayhem
continues
Indian banking sector experts stand in front of Da Afghanistan Bank. The Government of Afghanistan today authorised Punjab National Bank to start banking operations through a Representative Office at Kabul. Banks evince
greater interest in dollar Air Sahara flights
for Srinagar from today |
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Reliance cuts STD
rates TRAI to examine
hike in roaming charges EU may support
India at WTO
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Market mayhem continues
Mumbai, May 11 The market continuously moved downward since trading opened and closed nearly 230 points down at 5,325. Stock market analysts said more than Rs 60,000 crore worth of market capitalisation was wiped out in the past three trading sessions which saw the sensex fall 430 points. The bellwether 30-scrip Bombay Stock Exchange sensex has been falling since exit polls indicated major losses for the ruling party government. The 30-stock Sensex which opened 83 points lower at 5,472.03 was the day’s high, and dipped below 5,350 barrier to hit a low of 5,309.425, finished at 5,325.90 points, its lowest level since December 12, 2003 and shedding 229.94 points or 4.14 per cent from Monday’s close of 5,555.84, registering its biggest single day fall after March, 2000. The CNX Nifty of the National Stock Exchange also tumbled by 69.65 points to end below the 1,700 level at 1,699.45 points. The market opened extremely weak after the results of the exit polls at the end of the final phase of polling indicated hung Parliament, got another shock after the TDP collapsed in the AP assembly election, that strengthened a spectre of hung Parliament, Sameer Lala, analyst at Asit C. Mehta intermediaries Ltd said. Besides the spectre of hung Parliament, the negative trend in foreign fund inflows, the sharp fall in the US stock markets, surging oil prices and growing concerns over slowdown in the Chinese demand after it initiated steps to cool down its red-hot economy also dampened the sentiments, he said. The fall of the market was so broad-based as there was not a single gainer in the 30-stock Sensex, while in the broad-based BSE-100 only three shares managed to end in positive territory. Public sector stocks were the worst hit, dragging the BSE-PSU index by 209.64 points or 5.16 per cent to 3849.45 while banking stocks also lost ground heavily pulling down the BSE-bankex by 148.89 points or 4.75 per cent to 2987.84 points. Old economy counters like Tata Power, TISCO and L&T were major losers. PSU stocks took a major beating. IOC fell 10 per cent to touch Rs 461. Other loses included BPCL, Hind Zinc and GAIL. Even strong companies like ONGC, IPCL and BHEL were also facing a lack of confidence from investors.
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PNB to open account in Afghanistan New Delhi, May 11 The Government of Afghanistan today authorised PNB to start operations in Afghanistan and a licence to this effect has been issued, according to the Ministry of External Affairs here. PNB had evinced a lot of interest in starting commercial operations in Afghanistan because there are strong trading relations between Indian Punjab and Afghanistan, sources said. The Afghan national carrier, Ariana Afghan Airlines, runs need-based cargo flights from Amritsar. Last year, the Afghanistan Government had formulated a new banking law under which foreign banks could start commercial operations. So far only three or four foreign banks were allowed this facility. These foreign banks were given licences very selectively. PNB has become the first Indian bank to be given licence to operate in Afghanistan. The sources exuded confidence that the move would go a long way in boosting Indo-Afghan bilateral trade which is currently pegged at a meager $400 million. Even before PNB came into the picture, the Government of India had been assisting Afghanistan in revitalisation of its banking sector. India has nine banking experts in Afghanistan with different mandates. Three experts from the RBI were deputed to assist Da Afghanistan Bank, the country’s central bank, in July, 2002. Six experts from various banks in India were deputed to Da Afghanistan Bank from July-August, 2003, for a year. A Preferential Trade Agreement was signed between India and Afghanistan on March 6, 2003, that came into effect in May, 2003.
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Banks evince greater interest in dollar New Delhi, May 11 The bankers say that despite high volatility in dollar value, the demand for dollar has picked up by 10-15 per cent over the past one quarter. Further increase in oil import bill after sharp hike in international prices, they say, has also fuelled demand for US currency. Mr Rajesh Yaduvanshi, Senior Manager (International Banking), Punjab National Bank (PNB) claims: “Despite surplus foreign exchange reserves, banks are witnessing shortage of foreign exchange funds. A large number of corporate houses are in a queue to avail of funds, available at lower interest rates in comparison to Indian currency. So the bank has decided to revise interest rates on foreign currency non-residents (Banks) scheme for US dollars, UK pounds and Euro deposits with effect from May 8.” PNB, a major players in foreign exchange after SBI, has decided to revise interest rate on US dollar deposits, he said, from 1.37 per cent to 1.59 per cent for maturities of 1 year to less than 2 years, from 2.23 per cent to 2.44 per cent for 2 years to less than 3 years and from 2.85 per cent to 3.11 per cent for maturities of 3 years only. The bankers admitted that though foreign institutional investors (FII) were investing enough funds in India, but the RBI wanted to keep NRIs as long-term source of foreign exchange funds. So the banks were allowed to pay higher interest rates to them on foreign exchange deposits in comparison to overseas banks. The interest rate is linked to London Inter Bank Offered Rate (LIBOR) that has already increased from 1.63 per cent to 1.82 per cent leading to rise in interest rate in a month. Commenting on the increase in dollar demand, Mr Subhash Mittal, vice president, Federation of Indian Exporters said: “Under the RBI policy, the exporters can avail of credit for pre-shipment and post shipment requirements at LIBOR plus 0.75 per cent. But for additional requirements and for importers, the bank would ask for higher interest rate.” Further the rise in industrial production had also led to rise in dollar demand, he added. The rate of interest on British pounds has been revised from 4.55 per cent to 4.58 per cent for maturities of 1 year to less than 2 years, from 4.70 per cent to 4.81 per cent for 2 years to less than 3 years, and from 4.81 per cent to 4.92 per cent for maturities of 3 years only. PNB has also revised interest rates on Euro deposits from 1.93 per cent to 1.97 per cent for maturity of 1 year to less than 2 years, from 2.31 per cent to 2.46 per cent for 2 years to less than 3 years and from 2.66 per cent to 2.81 per cent for maturity of 3 years only. Other banks have also revised interest rates upward to raise funds from the NRI segment, the most reliable source of foreign funds, as against fly-by-night foreign institutional investors. Exporters claimed that since the buyers in the international market preferred trade in dollar only, so they were unable to shift to Euro or other currencies despite high volatility in the dollar value.
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Air Sahara flights for Srinagar from today
New Delhi, May 11 The direct flight between Delhi and Srinagar will leave everyday at 11.20 am and return at 2.30 pm, an Air Sahara spokesman said here today. “The connectivity provided by Air Sahara’s flight to Srinagar will promote tourism in the state and strengthen the economy of the state,” Chief Executive Officer of Air Sahara Uttam Kumar Bose said on the launch of the Srinagar sector. The private airline, second after Jet Airways, will operate with 50-seater Canadian Regional Jet (CRJ) to Srinagar. Vice-President Strategy and Operations Alok Sharma said “we are executing a strategy of connecting the smaller destination with the major cities in the country to promote all round development in the tourism sector. “Srinagar proves to be an ideal sector as there is resurgence in the tourism scenario and tourist inflow to these sectors is increasing,” Sharma said. Air Sahara recently started with its international operations by flying to Colombo. The Airline will soon fly to Kathmandu and Nepal.
— PTI
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Reliance cuts STD rates Chandigarh, May 11 According to a release issued here today, the STD rates from FWP/FWT to landline phones within the circle in the distance slab of more than 100 km have been brought down to Rs.1.65 for Plan 500, Rs. 1.50 for Plan 1000 and Rs.1.35 for Plan 1500 from Rs.2.20, Rs.2 and Rs.1.80. Additionally, the STD rates from FWP/FWT to landline phones outside the circle in the distance slab of more than 200 km have also been brought down to Rs.3.30 for Plan 500, Rs. 3 for Plan 1000 and Rs.2.70 for Plan 1500 from Rs.4.40, Rs.4 and Rs.3.60. The reduction in the call charges is due to the increase of pulse duration for intra-circle calls from 30 seconds to 40 seconds and for inter-circle calls from 15 seconds to 20 seconds in the distance slabs. All other call charges remain unchanged, says Mr S. P. Shukla, President (Wireless Products and Services), Reliance Infocomm.
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| TRAI to examine hike in roaming charges
New Delhi, May 11 “Last week, some operators had raised the roaming tariffs, and we are looking at it. We are examining the issue,” TRAI chairman Pradip Baijal said. Earlier this month, cellular operators like Airtel and Hutch hiked the roaming charges for post-paid customers by Rs 1.50. As per the new roaming rates, mobile to mobile calls up to 200 km would cost Rs 3.49 per minute against Rs 1.99 earlier and for distance over 200 km, the new tariffs are Rs 4.49 per minute against Rs 2.99. Similarly, a post-paid roaming customer calling a landline would pay Rs 4.49 per minute for distance up to 200 km against Rs 2.99 earlier, and Rs 5.49 for distance slab of 200-500 km compared to Rs 3.99 per minute charged earlier. For distance above 500 km, the roaming charges have been hiked to Rs 6.49 per minute compared to Rs 4.99 per minute earlier. Also, sensing a virtual unanimity among cable operators and private TV channels on implementing CAS, broadcast regulator TRAI today said it would submit recommendations on the matter, including price issues, to the government by July.
— PTI
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EU may support India at WTO
Brussles, May 11 “Absolutely,” said Anrancha Gonsalez, the spokesperson for EU Trade Commissioner, Mr Pascal Lamy, on being asked as to whether EU was ready to give that extra push. “It will be included in the Framework... We would be calling for more ambition from the member countries,” Mr Gonsalez said. India and some other developing countries are pushing for inclusion of services in the Framework, which is expected to be ready by July. India had also circulated a paper on Mode 4 of supply of services (temporary movement of natural persons) at the WTO seeking greater flexibility. New Delhi’s initiative on services at WTO has also received support from UK, a constituent of EU, and Australia, sources said.
— PTI
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