New Delhi, November 27
Union finance minister P Chidambaram today told the Rajya Sabha that there was no proposal to lower government equity in public sector banks to below 51 per cent and sought to allay misgivings of uncontrolled inflow of foreign capital into Indian banks.

Even though the previous NDA government had announced reducing government equity in public sector banks to 33 per cent, when the Congress-led UPA came to power "I made it clear that equity will not be reduced below 51 per cent. That stands and there is no proposal to reduce government equity," Chidambaram stressed.

He said the Prime Minister's Economic Advisory Council chairman C Rangarajan had suggested that the government might have to either bring in additional capital in the public sector banks or reduce its share to below 51 per cent to ensure rapid growth of the PSU banks.

The RBI guidelines of tier I capital are being stirctly followed by the banks. "Our policy is that we will ensure adequate capital strictly in accordance with Basel II norms. There is no uncontrolled inflow of foreign funds into the 
banking sector."

Chidambaram drew pointed attention to strict guidelines being laid down by the RBI, including a cap on FII and individual investments at 20 and 5 per cent, respectively.

Observing that there were large inflows in other sectors, Chidambaram explained that the increased foreign capital was mainly due to enlarged export earnings, remittances, FDI, foreign institutional investments and private equity. "This is good if we can absorb and turn it into productive investment." At the same time if large inflows give rise to inflationary trends, the RBI will have to make changes in the monetary policy which in turn will be reflected in the bank rates.

Asked if the government proposed to raise its stake in public sector banks to 74 per cent, the minister said there was no such proposal as that would require a large amount of funds.  

Mumbai, November 27
The sub-prime crisis haunting the banking systems of the United States will not have much impact on India as the banks here has negligible exposure to sub-prime credit, RBI Governor Y.V. Reddy said here today.

Addressing a conference on banking here, Reddy said the Indian regulator would, however, impose tighter liquidity on Indian banks in the wake of higher non-performing assets being reported by Indian banks.

"Though there are reports of accelerated emergence of non-performing assets in regard to consumer credit, housing and real estate in a few banks, our preliminary assessment is that these do not have systemic implications either in terms of solvency or liquidity," Reddy said.

He added that the central bank is "on a major extra-ordinary vigilance" following volatility in the money, credit and currency markets, asset prices and food items.

The RBI governor admitted that Indian banks were facing a rise in defaults of home and other consumer credit, though the problems were no where near the sub-prime crisis of the US banks where mortgage lenders were shutting shop.

Reddy hinted at the weakened status of the dollar as the world's currency of reserve. "The current phenomenon of simultaneous volatility should be viewed in the context of possible repositioning of the world's dominant reserve currency," he said.

According to him, the turbulence in the global financial markets was not anticipated but the uncertainties in the global environment were "unlikely to be clarified or resolved in the near future."

Calling on all banks against excessive reliance on call money borrowings, Reddy said they "may not be able to continue in the inter-bank market, in case of failure to repay the loan." He further noted that this would also give rise to perception that the bank was having fundamental problems.

The RBI Governor also admitted that the growth of credit has slowed down even as money supply is rising in the Indian economy. 

New Delhi, November 27
Punjab pavilion and Chandigarh pavilion have bagged silver medal in the state and union territory categories in the India International Trade Fair (IITF)-2007, organised by the India Trade Promotion Organisation (ITPO) at Pragati Maidan here.

While Kerala bagged Gold Medal in the state category, Lakshadweep received the top honour in the union territory category. Assam received the special commendation in the state category, according to an ITPO spokesperson. A jury constituted for the purpose made the selection.

The theme of IITF-2007, which was held between November 14 and 27, was agro-industries and processed food, which is close to the heart of Punjab.

Punjab pavilion was designed in such a manner so as to project the theme in ample measure. On one side of entrance, facia depicted the rapid strides made by Punjab in agriculture sector with large panoramic view of the agricultural field.

On the other side, singular achievements in the processed food industry were highlighted. The graphic depiction of the view was blended with exotic landscaping to appropriately mirror the theme of this year. Luscious wheat straw and simulated model of milk flowing in Punjab the land of abundance was also depicted.

In the north-eastern state pavilion category Meghalaya received Gold medal while Manipur received silver. Among overseas participating countries, China and Belarus bagged the gold and silver medals respectively.

Among the Central government pavilions, ministry of water resources received gold medal, ministry of power silver while special commendation was awarded to ministry of health and family welfare.

Gold medal was won by khadi and village industries commission, Nuclear Power Corporation of India and Coir Board received silver. North-Eastern Development Finance Corporation was given a special commendation. 

Tribune News Service
There was certainly Swami Ramdev effect on the IITF that concluded today. There was a huge demand for organic foods, natural products and herbal medicines at the fair. Swami has given a new impetus to the use of natural products as food and for curing ailments instead of preferring allopathic medicines and eating junk foods. 
Punjab’s organic foods were most sought after articles at the fair. Officers at the Punjab fair told The Tribune that most of the queries have come for organic foods. Hyola oil, a product of Punjab, that is free even from additive chemical and claimed to be 100 per cent natural was in a big demand. 
Punjab’s makki-di-roti and Sarson-da-sag was a big draw this year also. No one is better qualified to cater to the taste buds of middle class than that of Punjab. 
As processed foods are going to be the market of future, Punjab should prepare accordingly. Foods prepared from roasted wheat, roasted barley, half boiled maize, soyabean were selling like hot cakes at the fair. 
Among the foreign countries participating in the fair, Pakistan attracted the maximum attention after China and Thailand. Pakistan had set up 63 stalls at the fair and its cotton clothes show window drew maximum crowd and buyers also. Dry fruits sellers from Afghanistan also had a good time at the fair.

Kolkata, November 27
City-based P S Group today said it plans to build four SEZs across the country at an estimated investment of Rs 11,000 crore over the next three to four years.

“We have planned three services SEZs in Jaipur, Raipur and Kolkata and an IT SEZ at Chandigarh, all of which would be environment friendly,” P S Group chairman and managing director Pradip Chopra said here.

“Each services SEZs will require investment of Rs 3,500 crore while the IT SEZ at Chandigarh will need about Rs 300 crore,” he said, while announcing the project for developing PS Srijan Tech Park here which will meet green building norms.

The group signed a memorandum of understanding with a Singapore-based investor for FDI in these projects to the tune of 75 per cent as permitted by the government, Chopra said.

“Funds will not be a problem for the projects. Beside FDI tie up, we are also planning to tap the capital market over the next one year,” the group head said.

The company has received in-principal approval from the Rajasthan government for the Jaipur SEZ and applications for the other two have been submitted with the respective state governments.

Each of the services SEZs would be built over an area of between 250 and 400 acres.

For the Kolkata SEZ project the company has started acquiring land on the outskirts of Rajarhat Phase III.

The IT SEZs will have service sectors like IT, ITeS, KPO, medical, legal outsourcing, international trading, offshore banking and education.

The government has allowed a total of 105 services in the SEZs. — PTI 

New Delhi, November 27
GAIL India has won the rights to market the gas jointly produced by Reliance Industries, British Gas and ONGC from the Panna-Mukta-Tapti (PMT) fields, a move that will boost revenues of the company by over Rs 5,000 crore.

The oil ministry, after three meetings with GAIL and the PMT consortium, decided to nominate for life the state-run firm to market the gas, sources said.

GAIL currently delivers about five million standard cubic meters per day of gas from the fields lying in western offshore and is not entitled to marketing margin. The government has now allowed the company to charge a marketing margin of $0.12 per million British thermal unit on the entire output of about 17 mmscmd from April 2008.

Since 2006-07, GAIL gets about 5 mmscmd of PMT gas at $4.75 per mBtu. Reliance-BG-ONGC sell 4.8 mmscmd at $3.96 per mBtu (some of it to themselves) and another 6.5 mmscmd at rates ranging from $4.6 to $5.7 per mBtu.

The sources said GAIL will get the entire PMT output at $5.7 per mBtu, a move that will also boost revenues of BG Group of the UK, Reliance and ONGC.

For GAIL, the market margin would fetch a net income of about Rs 112 crore and transportation tariff would add another Rs 450 crore annually.

When contacted, GAIL chairman and managing director U D Choubey declined to comment.

In 2005-06, GAIL under P Banerjee had lost out of marketing rights of PMT gas when the government allowed Reliance, BG (who own 30 per cent stake each in the fields) and ONGC (which has the remaining 40 per cent) to market the gas. — PTI  

New York, November 27
India’s top corporate leader Ratan Tata has been named by global business magazine Fortune as one of the top 25 most powerful business heads, along with steel tycoon L N Mittal and PepsiCo’s Indra Nooyi.

The Fortune ranking closely follows a list by another global business publication Forbes, released earlier this month, that named India’s richie-rich led by Mittal and Ambanis, but there was no mention of Ratan Tata.

In the Fortune list released today, Tata has been named as the world’s 23rd most powerful person in business, ahead of CEOs of international media and entertainment giant Walt-Disney and French luxury goods major LVMH.

PepsiCo chief Nooyi, who was named at the top of a separate Fortune list of world’s most powerful business women for second year in a row last month, has been ranked at 22nd in the latest list, topped by Apple Computer CEO Steve Jobs.

Mittal, largest shareholder and CEO of the world's largest steelmaker ArcelorMittal, is ranked top among the three people of Indian origin. Ranked at 14th position in the list, Mittal’s name figures ahead of CEOs of international giants like JPMorgan Chase, Hewlett-Packard, Boeing, BHP Billiton, Blackstone and Mexican business tycoon Carlos Slim.

Apple’s Jobs is followed by media baron Rupert Murdoch (2nd), Goldman Sachs CEO Lloyd Blankfein (3rd), Google's founder-CEO trio Eric Schmidt, Larry Page and Sergei Brin (4th) and legendary investor and Berkshire Hathaway CEO Warren Buffett (5th).

About Tata - only resident Indian on the list, Fortune said: “As head of one of India's most venerated family businesses, Tata has unique stature. The Tata Group, which is one of India's largest conglomerates, includes India’s largest software house, one of its most prestigious hotel chains (the Taj), and sprawling steelmaking operations, as well as leading players in consulting, wireless, and cable services.”

Terming Nooyi as “smart, irreverent and armed with a global perspective”, the magazine said she was the main architect of the dramatic reshaping of Pepsi that began in the mid-1990s.

About the India-origin steel czar, the magazine said: “Had Lakshmi Mittal remained in India and joined the family steel company, odds are he’d merely be a prosperous local businessman. Instead, he set out on his own and became the Andrew Carnegie of our era, with operations in more than 60 countries, 320,000 employees - and a personal fortune of more than $40 billion,” it said. — PTI 

New Delhi, November 27
The Cabinet Committee on Economic Affairs (CCEA) today gave “in principle” approval to the Dedicated Multi-Modal High Axle Load Freight Corridor (DFC) Project on eastern and western corridors at an estimated cost of Rs 28,181 crore.

The eastern corridor, which is estimated to cost Rs 11,859 crore, will be from Ludhiana to Sonnagar in West Bengal and on western side, which is estimated to cost Rs 16,592 crore, will connect Jawaharlal Nehru Port near Mumbai to Tughlakabad/Dadri near Delhi, finance minister P Chidambaram told newspersons after the CCEA meeting.

The whole corridor will be having computerised train control system and the completion period of the project is expected to be five years.

The CCEA in its meeting held on February 21, 2006, had approved the eastern Corridor from Ludhiana in Punjab to Sonnagar via Ambala, Saharanpur, Khurja and Allahabad.

However, in view of the representation from the Government of West Bengal and also considering the possibility of increase in freight traffic on account of proposed deep sea port, the government had decided to consider extension of eastern corridor up to the proposed port in Kolkata area.

RITES is conducting a pre-feasibility study of Sonnagar-Kolkata portion of the eastern corridor. The CCEA will be approached for the approval of extension project after completion of the study.

The CCEA also gave its approval for implementing Integrated Handlooms Development Scheme, with a total budget provision of Rs 790 crore, as a Centrally Sponsored Plan Scheme during the 11th Five-Year Plan period from 2007-08 to 2011-12.

It would help meet the committed liabilities of the four erstwhile schemes — the Deen Dayal Hathkargha Protsahan Yojana; the Integrated Handlooms Training Project; the Workshed-cum-housing Scheme and the Integrated Handlooms Cluster Development Scheme.

The implementation of the scheme will benefit the weavers in developing/diversifying new designs and products, their skill upgradation of looms, providing a suitable workplace, with market support, thereby improving their earnings and socio-economic conditions. 

Mumbai, November 27
Amid rumours about US energy giant Chevron exiting Reliance Petroleum, derivatives trading in the company's scrip has been banned.

A Chevron spokesperson told PTI from California that it was evaluating its options regarding RPL. The petroleum major owns 5 per cent stake in RPL, currently valued at about $1 billion as against a purchase price of $300 million.

Meanwhile, RPL shares have been seeing huge turnover in both cash and derivatives segment over the past few days. The derivatives trading was banned soon after it resumed trading on Monday after a previous ban. The NSE said derivatives trading in RPL would be allowed only to decrease the existing position and taking fresh positions would not be allowed. — PTI  

New York/Dubai, November 27
Citigroup Inc is selling up to 4.9 per cent of itself for $7.5 billion to the Gulf Arab emirate of Abu Dhabi, giving the largest US bank fresh capital as it wrestles with the subprime mortgage crisis and the resignation of its chief executive.

The capital injection will shore up Citi's balance sheet, which has been hurt by some $6.8 billion of writedowns and losses in the third quarter, and the potential for another $11 billion in the fourth quarter.

Many investors feared Citi would have to cut its dividend to boost its capital base.

The sale to the $650 billion Abu Dhabi Investment Authority, the world's largest sovereign wealth fund, may also signal the freefall in US financial stocks is close to ending, analysts said.

''Citi is big, it's widely followed, and when people see confidence in it, it should mean something,'' said Bo Brownstein, an analyst covering financial stocks at Cambiar Investors in Denver, Colorado.

The dollar rose against the yen on the news, and Japanese bank stocks also rallied. In Tokyo trading, Citi shares fell 4.2 per cent for the day, but had been trading even lower before news of the Abu Dhabi deal. Family ruled Abu Dhabi - whose citizens number no more than 400,000 - will be Citi's largest shareholder. — Reuters

Mumbai, November 27
Kerala-based private sector lender Federal Bank plans to raise nearly Rs 2,000 crore through a rights issue next month, a top bank official said.

The fund-raising is to support its expansion plans, he said.

“The rights issue will be held between December 17 and January 15 and will be done in the ratio of 1:1,” Federal Bank chairman and chief executive officer M Venugopalan said here.

The bank has fixed the issue price at Rs 250 per equity share for a face value of Rs 10 each, he said. — PTI  

BRIEFLY

GVK Power 
Mumbai, November 27 
GVK Power and Infrastructure today said it has acquired 46 per cent in GVK Industries for an undisclosed amount. The company has acquired over 12.06 crore shares in GVK Industries following approvals from the Delhi and Andhra Pradesh High Courts, GVK Power informed the BSE. — PTI

Nirma buyout
Ahmedabad, November 27 
Nirma Ltd has announced that it would buy US-based soda ash producer Searles Valley Minerals for an undisclosed sum. When the deal is wrapped up, Nirma would lead the producers’ market in soda ash (sodium carbonate), a key ingredient to make soaps and detergents. — IANS

Mundra listing
Mumbai, November 27 
Mundra Port and Special Economic Zone Ltd today got listed at Rs 770 on the BSE with a 75 per cent premium over its issue price of Rs 440. Within minutes of listing, the scrip of the company touched a high of Rs 1,150 and over 14.15 lakh shares changed hands on the BSE. The initial public offer of the company was subscribed over 115 times. — PTI 

IOL Broadband 
New Delhi, November 27 
IOL Broadband Ltd today said it has entered into a VOIP service providers agreement with MTNL. The agreement will allow the state-run telecom firm to interconnect with millions of MTNL subscribers with local/STD/ international calls at very low rates. — UNI

Koutons Retail
Chandigarh, November 27
Koutons Retail India has won the ‘Chain store of the year’ award at the national awards for the excellence in apparel business organised by the clothing manufactures association of India (CMAI). Koutons is also credited with ‘brand entrepreneur of the year’ award at the APEX Awards-2007 organised by CMAI here. — TNS 

IndiaVenture 
Mumbai, November 27
IndiaVenture Advisors plans to launch a $300-500 million off-shore infrastructure fund within the next six months, a top company official said. The group would be the main sponsor of the fund. “The infrastructure fund will be launched in the next six months and will have a size in the range of $300-500 million,” IndiaVenture Advisors’ chairman A K Purwar said. — PTI 

Philips 
Amsterdam, November 27 
Philips Electronics has said it has reached a deal to buy US light-maker Genlyte for $2.7 billion, reinforcing its presence in the North American lighting products market. “This deal deepens our contacts to end users, helping us speed up the market rollout of more energy efficient lighting and the introduction of new lighting technologies,”CEO Theo van Deursen said. — Reuters

Allahabad Bank
Ludhiana, November 27
Anil Kumar, zonal head (Ludhiana), Allahabad Bank, said yesterday four branches of the bank at Amritsar and Ludhiana have become part of core banking solution (CBS) network having connectivity with major cities of the country. Kumar further said 37 of the bank’s 50 branches in Ludhiana zone would be connected with CBS by March 2008 and the bank has received licences from the RBI to open 15 branches in Punjab. — TNS