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THE TRIBUNE
 SPECIALS
50 YEARS OF INDEPENDENCE

TERCENTENARY CELEBRATIONS
B U S I N E S S

Expedite credit flow to MSE sector: RBI
New Delhi, May 5
Banks have been asked to consider "speedy implementation" of suggestions made by a working group for timely and adequate flow of credit to the micro and small enterprises (MSE) sector, the Reserve Bank said yesterday in a notification.

Kingfisher seeks over 2,000-cr loan to pay debts
New Delhi, May 5
Vijay Mallya-run Kingfisher Airlines is understood to be finalising a working capital loan of over Rs 2,000 crore from the country's largest lender, SBI, mainly aimed at clearing its fuel bills.

Satyam Stake
Tech Mahindra completes buyout
Mumbai, May 5
IT firm Satyam Computer today said its new owner Tech Mahindra has completed the process for acquiring 31 per cent stake in the company. In a filing to the BSE, Satyam said Tech Mahindra, via its subsidiary Venturbay Consultants, has been alloted 30,27,64,327 shares or 31 per cent stake in the firm.



EARLIER STORIES



The headquarters of German lender Hypo Real Estate is pictured in Munich on Tuesday.
The headquarters of German lender Hypo Real Estate is pictured in Munich on Tuesday. Hypo Real Estate posted a net loss of 382 million euros ($505.7 million) for the first quarter on Tuesday, just hours after the German government's takeover offer expired. — Reuters

Install voice-enabled ATMs for visually impaired, banks told
Chandigarh, May 5
While ensuring that technology also reaches out to the differently abled, the RBI has asked all banks to make at least one-third of their new ATMs as talking ATMs for the visually impaired.

SEBI notice to RIL
Insider trading in RPL
Mumbai, May 5
Market regulator SEBI is believed to have issued show-cause notice to Reliance Industries and its associate entities following a probe into charges of insider trading in securities of group firm Reliance Petroleum Ltd (RPL).

Re stronger by 62 paise
Mumbai, May 5
Completing three straight sessions of appreciation, the Indian rupee today shot up by 62 paise to close at a two-and-a-half month high of 49.30/31 against the US dollar on the back of sustained capital inflows amid late recovery in local equity markets.

Slowdown could last two years: E&Y
New Delhi, May 5
India Inc expects the ongoing slowdown to continue for the next two years, but even then many corporate houses are confident of achieving at least 10 per cent growth in this fiscal.

‘Exports from Ludhiana to fall by Rs 5,000 cr’
Chandigarh, May 5
Industry body Assocham today said Ludhiana was likely to suffer a Rs 5000-crore loss of export volumes for industrial units due to demand constriction in Europe and West Asia.

Now print from your BlackBerry anywhere!
Toronto, May 5
BlackBerry-maker Research In Motion (RIM) has announced a strategic tie-up with Hewlett Packard (HP) to provide “a portfolio of solution” to businesses on its smartphones.

Room for further cut in interest rates: ICICI
Mumbai, May 5
Hinting at easing of borrowing costs for retail and corporate customers, ICICI Bank's new chief Chanda Kochhar has expressed hope that interest rates could fall to single-digit level in the coming months.

BHEL to invest Rs 12,000 crore on expansion
New Delhi, May 5
Power equipment maker BHEL today announced an investment of Rs 12,000 crore over the next four years to pick up equity in power projects and to ramp up its capacity to support the generation of about 20,000 MW.

Govt to tighten vigil on sugar exports
New Delhi, May 5
The government has asked the Customs authorities to strictly monitor the sugar exports amid a sharp rise in prices and low sugar production estimates for 2008-09 season.





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Expedite credit flow to MSE sector: RBI

New Delhi, May 5
Banks have been asked to consider "speedy implementation" of suggestions made by a working group for timely and adequate flow of credit to the micro and small enterprises (MSE) sector, the Reserve Bank said yesterday in a notification.

The banks were suggested to put in place a loan policy, governing extension of credit facilities to the MSE sector and restructuring or rehabilitation policy for revival of potentially viable sick units.

The RBI had constituted a working group led by Punjab National Bank chairman K C Chakrabarty in recognition of the problems being faced by the MSE sector, particularly rehabilitation of potentially viable sick units.

Besides its recomendations to the banks, for credit delivery to SMEs, the group made various recommendations to the government, states, commercial banks and the SIDBI.

It suggested the Centre to create an independent rehabilitation fund with a corpus of Rs 1,000crore, and a marketing development fund among others.

It also recommended that banks have a non-discretionary one-time settlement scheme for recovery of non-performing loans for the MSE sector.

"Banks are, therefore, advised to apply the Reserve Bank’s guidelines on debt restructuring optimally and in letter and spirit. This would be to their advantage as well as their MSE clients," the apex bank said.

The state governments may also have a separate Ministry for MSME, provide preference in power supply, and provide land at 50 per cent of the normal rate for exclusive industrial estates, among other suggestions.

The suggestions for banks also include starting of central registration of loan applications, simplified application cum sanction form for loans up to Rs 1 crore, and opening of more specialised MSME bank branches.

"It may be ensured that there are no cases where term loan has been sanctioned and working capital facilities are yet to be sanctioned," the group recommended. The group has further asked for an action taken report by June 30. — PTI 

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Kingfisher seeks over 2,000-cr loan to pay debts

New Delhi, May 5
Vijay Mallya-run Kingfisher Airlines is understood to be finalising a working capital loan of over Rs 2,000 crore from the country's largest lender, SBI, mainly aimed at clearing its fuel bills.

The carrier, which has a total outstanding of over Rs 785 crore to IndianOil Corp (IOC), Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL), is looking to service the dues through the loan from SBI, according to industry sources.

"Kingfisher Airlines is in very advanced stages of getting the loan from SBI, which could be over Rs 2,000 crore. This should help the carrier meet its immediate and short-term capital requirements," a source added.

When contacted, a Kingfisher Airlines spokesperson declined to comment on the issue, citing confidentiality.

"Fund raising is an ongoing issue and because we are bound by confidentiality and non-disclosure agreements, it will be inappropriate to offer any comment at this stage," the spokesperson said. SBI officials could not be contacted for comments. As on April 20, the carrier owed IOC about Rs 160 crore.

Kingfisher also owes HPCL, its largest aviation turbine fuel (ATF) supplier, Rs 336 crore, and BPCL Rs 290 crore, the sources said.

IOC had encashed a Rs 50 crore bank guarantee after a cheque issue by the carrier towards fuel dues bounced and it had put Kingfisher on cash-and-carry about 2-3 months ago after the airline failed to honour its commitment of making timely payments for fuel dues as had been agreed last year.

On the IOC issue, the Kingfisher spokesperson said: "It is not Kingfisher Airlines' policy to discuss its relationships with suppliers in the public domain ...Kingfisher Airlines is operating its full schedule of flights daily." Both IOC and BPCL have stopped credit to Kingfisher and are asking the airline to make payments each time it refuels. HPCL, however, continues to give some credit to the airline. — PTI

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Satyam Stake
Tech Mahindra completes buyout

Mumbai, May 5
IT firm Satyam Computer today said its new owner Tech Mahindra has completed the process for acquiring 31 per cent stake in the company. In a filing to the BSE, Satyam said Tech Mahindra, via its subsidiary Venturbay Consultants, has been alloted 30,27,64,327 shares or 31 per cent stake in the firm.

Last month, Tech Mahindra had outbid others in the race to acquire a majority stake in the scam-tainted Satyam Computer, following which Venturbay had deposited Rs 1,756 crore in the escrow account as the subscription amount for the initial shares.

"Since the conditions precedent to the allotment of the initial shares have now been satisfied by the parties, the funds have been released from the escrow account to the company's account. The company expects to use the fund for general corporate purposes, including repayment of certain existing loans," the filing added.

Consequent to the said allotment, the paid-up capital of the company has gone up to Rs 195.34 crore, from Rs 134.79 crore, it said.

Further, Tech Mahindra would be making a cash tender offer to the public shareholders for acquiring an additional 20 per cent, at a minimum of Rs 58 per share, which is scheduled to begin on June 12.

Tech Mahindra, in which BT Group Plc owns 31 per cent, has valued Satyam at about Rs 5,800 crore.

Last month, the government-appointed board of Satyam had given its approval for acquisition of a 31 per cent stake by Tech Mahindra for Rs 1,756 crore. The deal has also been approved by the Company Law Board.

The company has already deposited Rs 2,910 crore in an escrow account for a 51 per cent controlling stake in Satyam Computer. Shares of Satyam closed at Rs 45.55, unchanged, while Tech Mahindra was down 0.58 per cent at Rs 333.65 on the BSE.— PTI 

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Install voice-enabled ATMs for visually impaired, banks told
Ruchika M. Khanna
Tribune News Service

Chandigarh, May 5
While ensuring that technology also reaches out to the differently abled, the RBI has asked all banks to make at least one-third of their new ATMs as talking ATMs for the visually impaired.

These directions come in the wake of several demands made by social welfare organisations demanding that steps be taken for the financial inclusion of visually impaired. These people are so far denied banking facilities because of unwillingness of banks to use technology for making services user-friendly for the visually impaired.

It is learnt that most of the banks allow the visually impaired to open only joint bank accounts. Since ATMs are not voice-enabled, they cannot be accessed. Even the cheques signed by the visually impaired are often put under scrutiny as there are problems in identifying signatures. Bank managers insist that the visually impaired customer come to the branch and sign cheques in front of them.

Though RBI has different symbols on currency notes, by the time the notes pass through different hands, all notes and coins feel the same. It is learnt that a Rs 500 note has a small circle, Rs 100 note has a rectangle and Rs 50 note has a square on the left hand side, which is slightly raised.

Moreover, the currency notes get shorter in length as their denomination decreases. Even different coins can be distinguished by touch. A Re 1 coin is soft to touch, Rs 2 coin is bigger in size (the older version also had rough edge), while Rs 5 coin is thicker.

The new directions issued by RBI for installing voice-enabled ATMs with Braille keypads, has finally set the ball rolling for financial inclusion of visually impaired. RBI has asked banks to ensure that these voice-enabled ATMs be put up in consultation with other banks to ensure that at least one such talking ATM with Braille keypads is available in each locality. Banks have also been asked to inform all their visually impaired customers about the location of such ATMs.

The RBI has also stepped up its efforts to ensure that the visually impaired come under the banking service net. It has asked all banks to provide cheque book, locker and ATM facility to them.

“They cannot be denied the right to avail these facilities on the pretext that there is risk involved in using these facilities, as the element of risk is involved in case of other customers as well,” says the directive.

The apex bank has also advised banks to take necessary steps for providing all existing ATMs and future ATMs with ramps, so that wheelchair-users or persons with disabilities can easily access them. It has also asked banks to make arrangements in such a way that the height of the ATM does not create an impediment in its use by a wheelchair-user.

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SEBI notice to RIL
Insider trading in RPL

Mumbai, May 5
Market regulator SEBI is believed to have issued show-cause notice to Reliance Industries and its associate entities following a probe into charges of insider trading in securities of group firm Reliance Petroleum Ltd (RPL).

While a company spokesperson did not comment on queries related to the notice, sources said SEBI had begun the probe in early 2008 after issue was raised in Parliament.

RIL had sold over four per cent equity in RPL in November 2007, prior to which heavy selling, said to be by various group entities, was noticed in the futures contract of RPL.

Sources said the gains made through these transactions could be over Rs 500 crore but no confirmation could be obtained from SEBI.

In the show-cause notice, SEBI is understood to have asked RIL and 12 associate entities, who said to have sold in the futures market, why action should not be taken against them under the SEBI Act and the Prevention of Fraudulent and Unfair Practices Regulation.

When contacted, SEBI's investigation department officials did not comment, saying they were not authorised to speak to media, while SEBI spokesperson could not be contacted. — PTI

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Re stronger by 62 paise

Mumbai, May 5
Completing three straight sessions of appreciation, the Indian rupee today shot up by 62 paise to close at a two-and-a-half month high of 49.30/31 against the US dollar on the back of sustained capital inflows amid late recovery in local equity markets.

A weak dollar against some Asian currencies, dollar selling by multinational banks as well as expectations of increased foreign funds inflow in share markets after a strong rally also boosted rupee sentiment.

In active trade at the Interbank Foreign Exchange (Forex) market, the domestic unit resumed strong at 49.60/62 a dollar from its previous close of 49.92/94.

It moved in a range of 49.70 and 49.28 before concluding at 49.30/31 per dollar, the level not seen since February 16, 2009, when it was closed at 48.82/83.

In the three sessions, the rupee has gained by 121 paise or 2.40 per cent. According to a forex dealer, heavy foreign funds inflows in local equity markets mainly supported the rupee. — PTI

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Slowdown could last two years: E&Y

New Delhi, May 5
India Inc expects the ongoing slowdown to continue for the next two years, but even then many corporate houses are confident of achieving at least 10 per cent growth in this fiscal.

According to a survey by consultancy firm Ernst and Young (E&Y) titled 'Opportunities in Adversity: India Inc's response to the financial downturn', 65 per cent of the respondents said they expected the slowdown to continue for at least two more years, while nearly 27 per cent saw the slowdown lasting 6-12 months.

The survey, which interviewed over 120 top management executives, found that 46 per cent of the respondents were confident of achieving at least 10 per cent overall growth in FY'10. "Organisations are relatively more optimistic about their own prospects as they have greater influence on their own performance, while they are more cautious on the macro-economic outlook as it is dependent on many additional factors," E&Y Partner and National Director (Markets) Sunil Chandiramani said.

"The last few months have been extremely tough and we have seen an increasing number of companies respond to these challenges with a slew of measures," he added.

Reflecting confidence in corporate prospects for FY'09, which many companies are yet to close, 42 per cent of the respondents said they would achieve 90 per cent of their targets, while 43 per cent were looking at meeting 70-90 per cent of their targets. Only 15 per cent said they would not attain more than 70 per cent of the targets, the survey added.

A number of issues, ranging from increasing pricing pressure to slowdown in order bookings, have dogged corporates and they are focusing on cost reduction. About 71 per cent of them have re-evaluated business plans to preserve cash.

Companies have also laid 'high' emphasis on rightsizing (which includes redeployment and workforce sharing instead of layoffs), with 69 per cent opting for this step as a cost-cutting measure. Another 61 per cent indicated a 'high' possibility of a hiring freeze.

The respondents showed a preference for term loans from banks (69 per cent), debt or equity from group entities (61 per cent) and mezzanine finance (which gives lenders the right to convert to ownership in case of default) (37 per cent), instead of accessing the capital market (10 per cent) and going in for private equity (20 per cent). A majority of the respondents (63 per cent) expected consolidation and were looking at mergers and acquisitions (58 per cent) for business growth. — PTI

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‘Exports from Ludhiana to fall by Rs 5,000 cr’
Tribune News Service

Chandigarh, May 5
Industry body Assocham today said Ludhiana was likely to suffer a Rs 5000-crore loss of export volumes for industrial units due to demand constriction in Europe and West Asia.

Participating in a seminar on ‘New stimulus package to help SME exporters and banks’ organised by Assocham and the Chamber of Industrial and Commercial Undertaking (CICU) at Ludhiana, CICU general secretary Avtar Singh said Ludhaina export volume were Rs 25,000 crore in fiscal 2008-09.

“During this fiscal, these volumes would come down to less than Rs 20,000 crore as export demand of Ludhiana products in major markets of Europe and West Asia has fallen because of global meltdown,” he said.

The CICU general secretary demanded Assocham intervention in terms of lobbying with the RBI for asking schedule commercial banks to extend export credit to Ludhaiana exporters at not more than 5 per cent interest rate.

Banks, according to Singh, are continuing to charge high bill collection amount despite instructions from the RBI. As a result, export competitiveness of Ludhiana exporters is getting reduced, he rued.

More than 100 exporters participated in the seminar. They demanded lower export credit and special package for exporters of Ludhiana and the state.

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Now print from your BlackBerry anywhere!

Toronto, May 5
BlackBerry-maker Research In Motion (RIM) has announced a strategic tie-up with Hewlett Packard (HP) to provide “a portfolio of solution” to businesses on its smartphones.

Under the tie-up, Hewlett Packard will unveil HP CloudPrint to enable BlackBerry users to print emails, photos, web pages and other documents from their smartphones to the nearest printer — at home, in the office or on the road.

The California-based PC maker will also unveil HP operations manager for BlackBerry Enterprise Server during the Wireless Enterprise Symposium at Orlando in Florida this year.

This manager (software) will "centrally monitor and manage the extended BlackBerry solution ecosystem.'' The ecosystem comprises the BlackBerry Enterprise Server software, mail servers, databases, Microsoft Active Directory and server operating systems such as Windows Server.

In a statement Monday, the Waterloo-based Canadian wireless giant said the solutions, including support for BlackBerry Enterprise Server, will raise service levels, cut operations costs and improve productivity for customers.— IANS

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Room for further cut in interest rates: ICICI

Mumbai, May 5
Hinting at easing of borrowing costs for retail and corporate customers, ICICI Bank's new chief Chanda Kochhar has expressed hope that interest rates could fall to single-digit level in the coming months.

"I should hope for that because that is going to be good for the economy," Kochhar told PTI in an interview when asked whether she foresees single-digit interest rates by middle of this year as forecast by her predecessor K V Kamath.

Kochhar, who assumed office of ICICI Bank's Managing Director and CEO this month, said there was room for further correction in interest rates.

"I feel that some more correction can take place in interest rates, because given where inflation is and given the comfortable liquidity position, I think a little more correction can take place," Kochhar said.

ICICI Bank was the first bank to cut lending and deposit rates after the central bank slashed its key short-term policy rates on April 21.

The same day, ICICI Bank reduced the benchmark advance rate by 50 basis points to 16.25 per cent, while the deposit rates were cut by 25-50 basis points across maturities.

Asked whether ICICI Bank was mulling over further rate cuts, Kochhar said that its rate would "move as per how it moves for whole banking system actually". — PTI

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BHEL to invest Rs 12,000 crore on expansion

New Delhi, May 5
Power equipment maker BHEL today announced an investment of Rs 12,000 crore over the next four years to pick up equity in power projects and to ramp up its capacity to support the generation of about 20,000 MW.

"We want to ramp up our capacity, (and) by 2011 we plan to become a 20,000 MW company. Besides we also plan to pick up a 26 per cent stake in more power plants... In all we have plans to invest Rs 12,000 crore in the next four years," CMD BHEL K Ravi Kumar told PTI.

Asked about the source of funding, he said, "It will come from internal accruals as BHEL is a cash-rich company." BHEL's current manufacturing capacity can support power generation of 10,000 MW.

It includes 2,500 MW of hydro electricity production, and 500 MW captive power plants for the industrial sector. A 1,000 MW is exported and the power plants coming up can generate 6,000 MW. By the end of this fiscal, the company hopes to make equipment for generating 15,000 MW.

Currently, BHEL is operating at more than 100 per cent capcity and ends up supplying supplying equipment to generate 11,500 MW. "We are supplying more than our capacity, we are providing equipment to produce 11,500 MW electricity," he said. — PTI 

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Govt to tighten vigil on sugar exports

New Delhi, May 5
The government has asked the Customs authorities to strictly monitor the sugar exports amid a sharp rise in prices and low sugar production estimates for 2008-09 season.

"It is directed that all field formations (including the Customs authorities) take necessary action for the compliance of the decision of the government," the Directorate General of Foreign Trade (DGFT) said.

The Department of Food and Public Distribution, Ministry of Consumer Affairs and Public Distribution had reintroduced the system of 'export release order' in February this year. — PTI 

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BRIEFLY

Battered UBS reports $1.8-b Q1 loss
Zurich/New Delhi:
Swiss banking major UBS has posted a first quarter loss of two billion Swiss francs (about $1.77 billion) and has warned of economic turmoil negatively impacting its credit-related provisioning in the coming months. For the three months ended March 31, 2009, the company has losses to the tune of two billion Swiss francs whereas in the year-ago period, the same stood at 11.62 billion Swiss francs, the entity said in a statement on Tuesday.— PTI

Swaraj Engines records highest-ever sales
Chandigarh:
Driven by strong growth in engine supplies to Swaraj Tractors, now a part of Mahindra and Mahindra, Swaraj Engines Limited (SEL) registered its highest-ever yearly sale of Rs 208.2 crore as compared to last year’s sale of Rs 125.4 crore, a growth of 66 per cent. The board of directors of SEL, who met in New Delhi on Tuesday, said the profit before tax for the company was Rs 32.2 crore for the year 2008-09, as compared to Rs 22 crore for last fiscal. — TNS

Hyundai i20 diesel by Dec
Seoul:
Korean auto major Hyundai Motor Company will bring the diesel variant of its premium hatchback 'i20' by the end of this year as part of its plan of introducing at least two new products in the Indian market annually for the next couple of years. The company is looking to enhance its share in the 10 lakh-units Indian car market through newer products.— PTI

L&T announces JV with EADS
Mumbai:
Larsen & Toubro on Tuesday announced the formation of a joint-venture company with EADS Defence & Security for developing and designing defence electronics products, including radars, avionics, electronic warfare to cater to the domestic and overseas markets. The yet-to-be-named venture, which is awaiting clearances from the Indian Government, would target to clock Rs 2,000-2,500 crore revenue in five-seven years, L&T chief A M Naik said. — PTI

Tata Steel, RINL hike prices
New Delhi:
Over six months after facing steep fall in prices of their products, steel producers Tata Steel and Rashtriya Ispat (RINL) have revised the rates of some of their long items, used in the construction sector, by up to Rs 1,000 a tonne. While Tata Steel has increased the prices in the range of Rs 300 and Rs 500 for the products to be sold in the spot market, state-run RINL has upped the rates by up to Rs 1,000 a tonne on rebars, which are mainly used in the housing sector.— PTI

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