Don’t sell Maruti stake for ‘a song’ CHENNAI, April 5 — The AIADMK today cautioned the Union Government against the move to give controlling stake in its joint venture Maruti Udyog to Suzuki Motor Corp for “a song” and said if the shares were auctioned as a block, it could fetch huge foreign exchange to boost the country’s reserves.

Spice Telecom site for Anandpur Sahib
CHANDIGARH, April 5 — Spice Telecom has extended its coverage to Anandpur Sahib Said Sean Dexter, Managing Director.

Workers demand right to work
NEW DELHI, April 5 — Workers from across the country today voiced concern at the rising unemployment and demanded that the right to work be made a fundamental right.

Tyre exports fall by 11 pc
NEW DELHI, April 5 — Hit by the South Asian currency crisis and poor demand from West Asia, tyre exports by major manufacturers, including Apollo, JK Tyres and Ceat, fell 11 per cent during April-February 1998-99 as compared to the same period last year.

J.T. Mobile moves court on DoT letter
NEW DELHI, April 5 — J T Mobile today moved the Delhi High Court seeking to stay on a Department of Telecom (DoT) notice to terminate its licence to operate cellular service in Punjab telecom circle.

Prices of two bulk drugs increased
NEW DELHI, April 5 — The National Pharmaceutical Pricing Authority has revised the prices of two bulk drugs, ranitidine and dimethyl cholorotetracycline HCL (DMCTC), following a request by the manufacturers.

Record output by HOCL
MUMBAI, April 5 — Hindustan Organics Ltd has recorded its highest ever production (2.71 lakh MT) and sales volume of 1.85 lakh tonnes in 1998-99.

Kelkar favours interest rate cut

NEW DELHI, April 5 (PTI) — The Finance Secretary Dr Vijay Kelkar today favoured the lowering of interest rates and greater “vigilence” on the exchange rate to make exports competitive and boost domestic demand.

“We have to ensure that interest rates move southwards through better fiscal management both in the States and at the Centre....We have to continue our vigilence on exchange rate to ensure that the exports continue to be a major source of demand,” Kelkar said, listing out the government’s programme to revive economy at a meeting with industrialists here.

Interestingly, last Saturday the Reserve Bank of India (RBI) Governor Dr Bimal Jalan had reportedly ruled out any cut in interest rates in the forthcoming slack season credit policy at a meeting of industrialists organised by PHDCCI.

The RBI will announce its credit policy on April 20.

Stating that the current interest rates were high, the Finance Secretary told the meeting on “Industrial slowdown’ organised by the Confederation of Indian Industry (CII) that interest rates would become the dominant instrument for revival of growth.

Kelkar, however, did not elaborate on the government’s view on exchange rate, except for saying “we are going to be very vigilant on the exchange rate as explained in the economic survey.”

The survey had said that there was a need to monitor closely the value of the rupee to ensure that exports continue to be price competitive.

Kelkar said the main reason for the current slowdown was decline in all sources of demand, which the government tried to reverse in its last Budget.

The stimulants provided in the Budget would bring a turnaround in the economy by reviving demand.

The Finance Secretary said the concession given to the mutual fund sector in the Budget was part of attempts to bring back retail investors to the Capital market.

Retail investors have lost their trust in the capital market and are looking for other avenues of investment, he said.

Despite a negative rate of return on investments in gold, $ 7 billion per annum was going into it, Kelkar said adding that the government was trying to tap this source through the gold scheme announced in the Budget.

The Finance Secretary said reducing the cost of capital was the only way to bring more private investments as public sector investment was not likely to go up sharply in the near future.

On agriculture, Kelkar said the sector would form an important part of the second generation reforms, which are likely to be set in motion soon.

Earlier, making a presentation on the slowdown, Jairam Ramesh, Secretary of the Congress Economic Affairs Committee, said the main reasons for the downturn were investment slackness and slow restructuring of the Indian industry.

Foreign investment norms liberalised

NEW DELHI, April 5 (PTI) — The government today further liberalised the foreign investment regime by allowing companies to pump in more foreign investment without its prior approval, if the percentage of foreign shareholding remains the same.

However, the changes will not apply to cases where there was an increase in the percentage of foreign equity and where the original project cost was more than Rs 600 crore, an official release said here today.

“Any company can henceforth infuse additional funds by way of foreign equity as a result of financial restructuring (provided there is no change in the percentage of foreign equity) and notify the same to the Secretariat of Industrial Assistance (SIA) within 30 days of receipt of funds as also allotment of shares to non-resident shareholders,” it said.

This has been done keeping in view the desirability of infusion of additional funds as equity by the foreign company, leading to increased investment inflows.

Earlier, for any proposed increase in the amount and percentage of foreign holding, prior approval of the Foreign Investment Promotion Board (FIPB)/government was needed.

The government has also changed the applicability of dividend balancing procedures by allowing it only to extent of incremental foreign equity in cases where it was not applied at the first instance as per the existing policy then.

Short-term rates on govt securities may fall: I-Sec

NEW DELHI, April 5 (PTI) — ICICI Securities (I-Sec) today said the short-term interest rates on the government securities is likely to fall in the current fiscal due to an increased demand for long-dated securities.

“Increased participation in long-end sovereign paper will require a steeper yield curve, thereby necessitating a decline in short term rates,” I-Sec said in its latest money market update.

Currently, the indicative yield to maturity for March 2000 treasury bills is 10.15 per cent.

According to I-Sec, the differential between the one and 10 year rate has to exceed 220 to 230 basis points (currently 190 to 195 basis points) for the market participation to increase in long-dated securities, having a tenure of over 10-15 years.

The market demand for short and medium-end securities (three to nine years) increased as the RBI removed the sale quotes of 11.15 per cent for 2002 dated securities and 11.98 per cent for 2004 securities from its open market operations.

“Buying interest at this end seems to confirm market belief that auction announcements in the beginning will be concentrated at the long-end thereby leaving room for appreciation at the medium-end,” I-Sec said.

However, I-Sec said it did not expect significant appreciation unless yield curve steepens as a result of decline at the short-end.

I-Sec said the government’s borrowings for the current fiscal was expected to kick-off this week with a long-dated security auction coupled with a 364-day treasury bill auction.

“Given the outstanding maturity profile of existing debt, we expect a decided shift toward long-dated securities by the government,” the money market report said.

Though 12 per cent interest rate securities maturing on Wednesday would result in a Rs 4,417 crore inflow, the government would come out with fresh auctions this week to negate this.

HSIDC cuts interest rates
Tribune News Service

CHANDIGARH, April 5 — The Haryana State Industrial Development Corporation (HSIDC) has become the first financial institution in the country to reduce interest rates on loans advanced under the fixed rate of interest scheme.

Announcing this here today, the Managing Director of the corporation, Mr Y.S. Malik, said the reduction in the interest rates would vary between 2 per cent and 4.5 per cent.

The decision will benefit only those borrowers who had been advanced loans under the letter-of-credit-linked refinance scheme of the IDBI.

The borrowers, desirous of availing the benefit under the scheme, will have to pay 50 per cent of the pre-payment charges on the balance outstanding loan amount which would be calculated following the net present value (NPV) formula with the present reference rate at 17.5 per cent.

The borrowers will also be required to sign a supplementary agreement with the HSIDC that the balance loan amount would be covered under the floating rate of interest scheme. The corporation had advanced loans at an interest rate of 20 per cent and 21 per cent during 1996-97 when the refinance rate of the IDBI was 16.5 per cent and 17.5 per cent. The floating rate of interest under the new scheme would be 16.5 per cent at present which would be reviewed on a quarterly basis linked with the cost of borrowings for the HSIDC under the scheme.

Don’t sell Maruti stake for ‘a song’

CHENNAI, April 5 (PTI) — The AIADMK today cautioned the Union Government against the move to give controlling stake in its joint venture Maruti Udyog to Suzuki Motor Corp for “a song” and said if the shares were auctioned as a block, it could fetch huge foreign exchange to boost the country’s reserves.

In a statement here, AIADMK General Secretary Jayalalitha said if the government wants to sell its equity, it should put up its entire shareholding as a block for sale to the highest bidder.

Stating that she was disturbed to learn of plans to dispose of the government’s near 50 per cent stake in Maruti Udyog, Jayalalitha said: “The reports are that this is sought to be done through sale in the market to many buyers”.

By selling as a block instead of piecemeal offerings, about 30 per cent extra revenue could be secured for the exchequer, she said.

Jayalalitha said the government money and property “are not the assets of ministers and officials’ but belonged to the people of ‘this poverty-stricken country”, and as such in disposing of such assets care should be taken to ensure the highest value.

Jayalalitha said already the Union Government had signed one-sided agreements to the benefit of Suzuki “using the excuse that such concessions will influence the Japanese government to ‘abandon its coercive and hostile’ economic sanctions against the “poor” Indian millions.

“On the contrary, despite the concessions, the Japanese government continues to block loans to India from international financial agencies’.

Spice Telecom site for Anandpur Sahib
Tribune News Service

CHANDIGARH, April 5 — Spice Telecom has extended its coverage to Anandpur Sahib Said Sean Dexter, Managing Director. The Spice site that covers the 14km 4-lane highway between Kiratpur Sahib and Anandpur Sahib, along with the whole town of Anandpur Sahib, was up and running in a record of eight days. “The usual time to get a site up and active runs between 25-35 days — This is the first time that we have introduced an active site in such a short period. In order to commission the site we have postponed building two sites to utilise the equipment at Anandpur Sahib,” added Dexter. The tower is located at Kila Anandgarh (Anandgarh Fort), approximately 400 metres from Takht Shri Kesgarh, the main gurdwara at Anandpur Sahib.

Workers demand right to work

NEW DELHI, April 5 (PTI) — Workers from across the country today voiced concern at the rising unemployment and demanded that the right to work be made a fundamental right.

“Our fight is for the right to work as unemployment is rising in the country. Unemployment is not only among the illiterate people but even technically-skilled people are without work,” said Hind Mazdoor Sabha (HMS) General Secretary Umraomal Purohit at the convention on “Right to work”.

Stating that a growing trend of shedding manpower was being witnessed in the private sector, he said the unemployment level was also being raised through various means, including voluntary retirement scheme (VRS).

“Efforts are being made to take out people from the organised sector to unorganised sector,” Purohit said at the meet organised by HMS.

All India Railwaymen Federation (AIRF) General Secretary J.P. Chaubey said the possibility of getting employment easily in future seemed to be remote in view of changing policies.

WTO dominates China’s agenda for ASEAN

KUMING, China, (AFP): China and ASEAN member-States opened talks here on Monday with the biting regional economic crisis and Beijing’s long-standing bid to enter the World Trade Organisation dominating the agenda.

A long-standing South China sea territorial dispute over the Spratly islands was also due to figure at the talks.

Among the issues discussed was China’s foreign policy and developments in the economic situation among the nine-member association of South-East Asian Nations (ASEAN), the group’s Secretary General Rodolfo Severino told AFP.

China and Indonesia were due to brief the other countries on their economic situation and reforms undertaken in the past year since their last meeting.

Ties between super powers China and the USA were also discussed, amid a flurry of talks on Beijing’s 13-year bid to join the WTO as well as the role of international finance organisations and short-term capital flows.

Boost demand

BANGKOK (AFP): Asian economies must do more to bolster domestic demand which has been named in a landmark new survey as the biggest challenge to business in the region, the World Bank has said.

World Bank Vice-President for East Asia and the Pacific Jean-Michel Severino has said that the pace of private sector debt restructuring is also one of the bank’s “biggest worries”.

“Corporate debt restructuring, the financial side of it, is moving slowly,” he told reporters at a press conference here.

Severino was speaking after meeting Thai Finance Minister Tarin Nammanahaeminda, who has unveiled a multi-billion dollar stimulus package to kick-start the economy out of its worst-ever recession.

The World Bank contributed some $ 600 million to the package while the Export Bank of Japan has pledged 87.6 billion yen ($ 600 million) under a $ 30 billion initiative for crisis-hit Asian economies.

Ratings

JAKARTA, (AFP): Standard and Poor’s has restored Indonesia’s long-term foreign currency sovereign rating, just a day after a downgrade by the US agency sparked an angry central bank rejoinder.

Performing a rare about-face, the New York-based credit assessor it had “reset” the rating from “selective default” back up to “triple-C-plus”.

Standard and Poor’s said the move “reflects Indonesia’s closure of a distressed rescheduling of $ 210 million worth of principal on the rated $ 310 million loan.”

Unemployment

TOKYO, (ANI): The unemployment rate in Japan has jumped to a record high 4.6 per cent in February.

Speaking to reporters here, the country’s Economic Planning Agency chief Taichi Sakaiya said the data for the unemployment rate in Japan was “worse than expected”. He said, “this shows that the Japanese economy’s ability to rebound is still extremely weak”.

However, he said the data showing such a high unemployment rate in February was the result of technical factors such as fewer working days in that month.

US projects

COLOMBO, (ANI): Sri Lanka’s Bureau of Infrastructure Investment has said that it is very keen to promote private sector involvement in the country and it has US projects worth $ 3 billion in the pipeline.

Bureau Director-General Ranjith Thabrews told mediapersons that his institution had projects for at least the next five years, which were either in the feasibility or under the negotiation stage.

Recession

TOKYO (AFP): Japan’s business confidence may seem to be finally on the mend but analysts warn the world’s second largest economy is still firmly stuck in recession.

The Bank of Japan’s quarterly Tankan survey released on Monday showed its first improvement in two years.

Although it was not as resounding a recovery as economists had predicted, the figures were enough to drive up Tokyo’s stocks in early trade.

But the optimism quickly waned, and the Nikkei stock index closed up a modest 44.59 points, or 0.3 per cent at 16,334.78.

It’s 167-pt crash, courtesy Jaya

MUMBAI, April 5 (PTI) — Equities virtually crashed pushing the sensex down by 4.53 per cent on the opening day of the new account on the stock market today in the wake of panic selling triggered by fears of a political crisis after the AIADMK decided last Saturday to forge a new alliance.

Taking stock of the political developments that indicated the fall of the BJP-led government at the Centre, bulls resorted to heavy liquidation to come out of their commitments resulting in the biggest fall in the sensex after October 5, 1998, when it had dipped by 224.22 points.

Out of 149 specified shares, 136 scrips, including all the 30-index scrips, showed sharp-to-moderate falls.

Operators discounted the positive news like the bold exim policy and even expectations of fresh reforms in the forthcoming credit policy after the encouraging Budget as they feared that the AIADMK would withdraw support to the BJP-led government within a couple of days.

Even Indian financial institutions (FIs) fell in line with bull operators and reportedly sold heavily in index heavy weight scrips like SBI, Reliance Ind, Telco and Tisco.

The BSE sensitive index opened sharply down at 3625.21 and later moved downwards to the intra-day low of 3499.83 before closing at 3519.39 as against last Thursday’s close of 3686.29, netting a fall of 166.90 points.

The BSE-100 index also tumbled by 74.10 points to 1559.77 from the previous close of 1633.87.

Dealers said the market could stabilise only after the emergence of an encouraging political scenario as the fall of the present government would jeopardise the financier, Pentafour Software, Telco, E Merck, SBI and Siemens hit the lower circuit filter after exhausting the daily price limits. Over 110 scrips in B1 and B2 also hit the lower price band.

The BSE-200 index and the dollex were quoted sharply down at 359.60 and 141.07 compared with last weekend close of 376.14 and 147.59 respectively.

Satyam Computer was the top traded scrip with a turnover of Rs 245.00 crore among the total volume of business of Rs 1559.62 crore. Other active scrips were Pentafour Software (Rs 219.38 crore), ITC (Rs 128.31 crore), SBI (Rs 62.78 crore) and RIL (Rs 57.18 crore).

Satyam Computer dropped by 135.75 to 1564.25. Pentafour Software also dipped by 100 to 1151, ITC by 61 to 883.75, SBI by 16.40.

Tyre exports fall by 11 pc

NEW DELHI, April 5 (PTI) — Hit by the South Asian currency crisis and poor demand from West Asia, tyre exports by major manufacturers, including Apollo, JK Tyres and Ceat, fell 11 per cent during April-February 1998-99 as compared to the same period last year.

Total tyre exports during the first 11 months was worth Rs 657.82 crore as against the export earnings of Rs 739.04 crore achieved during the corresponding period last year.

According to the Automotive Tyre Manufacturers Association (ATMA) while exports of Apollo, Ceat and JK Tyres dipped 16, 17 and 13 per cent respectively, exports by MRF, Goodyear and Falcon increased 10, 22, and 25 per cent respectively.

The overall decline of 11 per cent in exports is against the ambitious target of Rs 1000 crore for 1998-99 set by ATMA.

The total exports of tyre from the country would be much below the target set by the industry for 1998-99 and even substantially lower than the previous year’s level, an ATMA official said.

India’s tyre exports during 1997-98 was worth Rs 906 crore which was a 9 per cent increase over the previous year’s figure of Rs 832.61 crore.

While Apollo’s exports earnings dipped 16 per cent to Rs 100.53 crore from Rs 119.47 crore and that of Ceat by 17 per cent to Rs 107.64 crore from Rs 129.26 crore last year, export earnings of MRF and Goodyear rose 10 and 22 per cent to Rs 112.66 crore and Rs 10.12 crore respectively.

J.T. Mobile moves court on DoT letter

NEW DELHI, April 5 (PTI) — J T Mobile today moved the Delhi High Court seeking to stay on a Department of Telecom (DoT) notice to terminate its licence to operate cellular service in Punjab telecom circle.

The DoT letter, dated March 26, says the licence will stand terminated automatically without any further notice if licence fee arrears worth Rs 348 crore including interest was not paid within 30 days.

After a brief hearing, Justice M K Sharma adjourned the case for April 21.

As per the DoT letter, one-month notice period will end on March 25 and the termination of licence will come into force immediately after that.

According to the licence agreement, DoT is required to give one-month notice to mobile cellular service provider to terminate the licence.

Counsel for JT Mobile Shanti Bhushan said the company should not be forced to pay the licence fee for the period they have not been able to actually operate the service because of DoT’s failure to grant certain permissions.

He said the department granted permission to Evergrowth Ltd, a wholy-owned subsidiary of J T Mobile, to operate mobile service in Punjab in 1996 which was cancelled in 1997 and restored in 1998 which led to delay.

DoT counsel Rakesh Tiku said the permission to Evergrowth to open rate service on behalf of J T Mobile was conditional and it was withdrawn by the department following the company’s failure to fulfil those conditions.

Prices of two bulk drugs increased

NEW DELHI, April 5 (PTI) — The National Pharmaceutical Pricing Authority has revised the prices of two bulk drugs, ranitidine and dimethyl cholorotetracycline HCL (DMCTC), following a request by the manufacturers.

The price of ranitidine has been raised 4.31 per cent from Rs 1,203 to Rs 1,255 per kg, mainly due to an increase in the customs duty and depreciation of the rupee against US dollar, an official release today said.

DMCTC will now be dearer by 5.2 per cent, from Rs 4,332 to Rs 4,559, on account of an increase in the cost of indigenous raw material and electricity rates.

The price revision, notified on March 31, will become effective within 15 days from the date.

Record output by HOCL

MUMBAI, April 5 (PTI) — Hindustan Organics Ltd (HOCL) has recorded its highest ever production (2.71 lakh MT) and sales volume of 1.85 lakh tonnes in 1998-99.

The corresponding figures for the previous year were 2.69 lakh tonnes and 1.695 lakh tonnes a company release said here today.

Capacity utilisation was 94 per cent compared to 91 per cent in the previous year. This increase was in spite of the steep decrease in international prices, cheap import of finished goods and low demand growth.

HOCL has set for itself high production and sales targets for the current fiscal, the release said, adding that an MoU has been signed between the company and the Department of Chemicals and Petro Chemicals.

US $ Rs 42.43/50
STG £ Rs 68.06/08
Euro Rs 45.66/68
Jap Yen (100) Rs 34.95/97
The RBI reference rate was Rs 42.44.

Seminar
Tribune News Service
CHANDIGARH, April 5 — A seminar on bank audit was organised by the Chandigarh branch of Institute of Chartered Accountants of India (ICAI) under the Chairmanship of Mr D.K. Singla. Mr Amarjit Chopra, a member of Central Council of ICAI highlighted the grey areas to be covered while carrying out bank audit. Mr Vijay Jhalani, Chairman, Northern India Regional Council (NIRC) of ICAI graced the occasion. Mr Vivek Arora, Secretary, conducted the proceedings.

IEC Software
Tribune News Service
CHANDIGARH, April 5 — IEC Softwares Ltd. has bagged a Rs 50 million contract from NCPUL - an autonomous body under the Ministry of HRD, for implementing a one year training course in computer application. The agreement is for a period of four years and is currently worth Rs 18 million, to be extended further up to 50 million by March, ‘99.

Delhi wages up
NEW DELHI, April 5 (PTI) — The Delhi Government today increased the minimum wages by Rs 411 per month to all employees covered by the Minimum Wages Act, 1948.