Disinvestment panel under PM formed
NEW DELHI, Jan 13 — The government today announced that it would constitute a Cabinet committee under the chairmanship of Prime Minister Atal Behari Vajpayee on disinvestment and decided to sell its equity in six public sector undertakings through buyback or sale of shares to another public sector company directly.

Precision Fasteners’ rating downgraded
MUMBAI, Jan 13 — The non-convertible debenture programme of Precision Fasteners Ltd has been rated ‘D’, revised downwards from ‘B’, by Crisil, indicating that the instrument was in default or expected to default on maturity.

• Microsoft, BPL plan jv

FM: reform process is not anti-labour
NEW DELHI, Jan 13 — The Union Finance Minister Mr Yashwant Sinha said today that the economic reforms process is not anti-labour and the basic objectives of ongoing reforms is to have faster economic growth.

CMIE predicts 4.5 per cent growth
MUMBAI, Jan 13 — The 4.5 per cent growth in GDP expected this fiscal is likely to continue during 1999-2000 too, with little chance of an extraordinary reversal in trends, according to the Centre for Monitoring the Indian Economy.

Director arrested for fraud
NEW DELHI, Jan 13 — The economic Offences Wing of the Delhi Police today arrested the Director of Foremost Exims Limited on the charge of cheating.

Slow reform dims outlook on Indian banks: Moody’s
NEW YORK, Jan 13 — International rating agency Moody’s Investor Service today said high levels of non-performing loans and sluggish reforms were darkening the outlook for Indian banks’ financial strength ratings.

Sensex falls by 43 pts on selling
MUMBAI, Jan 13 — After initial signs of a recovery, equities reacted sharply, particularly after midsession, and even posted further losses on the stock market today following fresh selling by operators as well as financial institutions.

Disinvestment panel under PM formed

NEW DELHI, Jan 13 (UNI) — The government today announced that it would constitute a Cabinet committee under the chairmanship of Prime Minister Atal Behari Vajpayee on disinvestment and decided to sell its equity in six public sector undertakings through buyback or sale of shares to another public sector company directly.

The sale of government shares will help in achieving the target of raising Rs 5,000 crores through disinvestment in the current financial year, an official spokesperson told newsmen after the Cabinet meeting.

The newly constituted Cabinet committee will replace the existing group of ministers which will have the Finance Minister, Industry Minister and administrative ministry of the concerned PSU’s minister as member.

The spokesperson said the price of sale of shares of six companies, which will be sold in the next two months, would be decided by the Finance Minister, the Industry Minister and the Minister of Administrative Ministry on the recommendation of the core group of Secretaries on disinvestment.

The company management has the option to reduce the government holding either through buyback or sale to another public sector company directly. While opting for buy-back route, the equity capital of the company would decline. In other case, the equity of the PSU will remain the same. At the same time, the holding of a purchasing PSU will increase to the extent it buys shares in the company, which is offering its equity.

As per today’s Cabinet decision, the government has allowed the sale in case of ONGC ( up to 12.5 per cent), the Indian Oil Corporation and Gas Authority of India Limited (both upto 10 per cent. Sale up to 5 per cent of the government equity in Mahanagar Telephone Nigam Limited and Videsh Sanchar Nigam Limited has been allowed either through buyback or sale to another PSU.

Microsoft, BPL plan jv

BANGALORE, Jan 13 (PTI) — BPL and Microsoft Corporation (India) Pvt Limited have announced a joint initiative to provide interactive voice response, computer telephony and call centre applications. Under the initiative, BPL will develop applications and products relating to interactive voice response systems, computer telephony and call centres using microsoft windows operating system, a Microsoft press release today said.

FM: reform process is not anti-labour
Tribune News Service

NEW DELHI, Jan 13 — The Union Finance Minister Mr Yashwant Sinha said today that the economic reforms process is not anti-labour and the basic objectives of ongoing reforms is to have faster economic growth.

In a pre-Budget meeting with the major trade union leaders here today, the Finance Minister said that experience of other countries indicates that the faster the rate of overall growth, the faster is the rate of poverty reduction.

It is therefore very often argued that a sustained and long-lasting solution to the problem of poverty and unemployment depends on the creation of opportunities for broad- based economic development and higher growth, he added.

The Finance Minister mentioned that the government has decided to set up the second Labour Commission to review the existing laws and Acts for the organised labour class for improvement in the system of labour welfare and labour protection and at the same time to suggest the measures to protect the interests of the labour class in the unorganised sector.

The Finance Minister urged the trade union leaders to indicate their views to improve the industrial and overall growth , to strengthen the level of physical and human infrastructure and to accelerate the growth of employment.

Mr Sinha also sought their suggestions to improve the social security system and the safety net for workers .

CMIE predicts 4.5 per cent growth

MUMBAI, Jan 13 (PTI) — The 4.5 per cent growth in GDP expected this fiscal is likely to continue during 1999-2000 too, with little chance of an extraordinary reversal in trends, according to the Centre for Monitoring the Indian Economy (CMIE).

After three years of 7 per cent growth, from 1994-95 to 1996-97, growth in the Indian economy slipped to less than 5 per cent and the CMIE believes it would not be more than 4.5 per cent this fiscal.

Growth in agricultural production has been estimated at 1.5 per cent, industrial production at around 4 per cent and services marginally higher than 6 per cent.

“We believe that the economy will expand not more than 4.5 per cent in 1998-99, the second consecutive year to record such a level of growth”, the CMIE stated in its monthly review of the Indian economy.

Prospects for 1999-2000 are not encouraging either, with agriculture projected to grow by only two to 3 per cent depending on the distribution of rains in the next season.

Investment proposals have also been declining and there are no indications of a reversal of this status in the coming months, it said adding that competition from cheap imports would continue to plague the domestic industry and the industrial sector is not likely to grow by more than 5 per cent in the coming year.

However, if next year’s crop is extraordinary and investments pick up substantially, growth rates may increase to 5.8 per cent, it added.

Precision Fasteners’ rating downgraded

MUMBAI, Jan 13 (PTI) — The non-convertible debenture (NCD) programme of Precision Fasteners Ltd has been rated ‘D’, revised downwards from ‘B’, by Crisil, indicating that the instrument was in default or expected to default on maturity.

The rating assigned to the company’s fixed deposit programme has also been downgraded to default category, ‘FD’.

Crisil has also downgraded the rating assigned to the NCD programme of Sabero Organics Gujarat Ltd to high risk category, ‘C’ from ‘A’, on account of pressure on liquidity precipitated by an increase in working capital requirements due to a build-up of recievables, Crisil said.

The company failed to arrange for short-term funds and decided to default on its debt obligations.

The NCD issue of Madhusudan industries has also been revised downwards, from ‘A’ to ‘A’, indicating a decline in the company’s profitability, weakening market position coupled with limited demand growth in sanitaryware industry over the last three years and continuing poor performance of its subsidiary.

Sensex falls by 43 pts on selling

MUMBAI, Jan 13 (PTI) — After initial signs of a recovery, equities reacted sharply, particularly after midsession, and even posted further losses on the stock market today following fresh selling by operators as well as financial institutions.

Prices attempted a recovery with the BSE sensitive index hitting the intra-day high of 3385.20 in the initial stages, when the market witnessed good support attributed to the opening day of new account on the National Stock Exchange.

However, the fresh pounding by foreign institutional investors (FIIs), who reportedly sold about five lakh shares of Zee Telefilms ahead of the company’s announcement of third quarterly results this evening, in Indian stocks forcing local operators to fall in line.

As a result, the sensex dropped to the low of 3292.63 before closing at 3310.46 as against yesterday’s close of 3353.22, netting a fall of 42.76 points.

Domestic institutions reportedly booked profits in Hind Lever, ITC, MTNL as well as engineering and electric stocks.

FIIs, however, were reportedly net buyers in software scrips like Infosys Technologies, NIIT, Pentafour Software, Satyam Computer and others, which scored impressive gains.

the BSE-100 index dipped by 21.05 points to 1475.13 from previous close of 1496.18.

Dealers said the market was going through a corrective phase and expected to turn around at 3280-support level, from where it will gradually pick up for another sharp rally.

“It is likely to bounce back from this level tomorrow morning”, a leading dealer commented.

Slow reform dims outlook on Indian banks: Moody’s

NEW YORK, Jan 13 (PTI) — International rating agency Moody’s Investor Service today said high levels of non-performing loans and sluggish reforms were darkening the outlook for Indian banks’ financial strength ratings.

The asset quality of the Indian banks was weighed down by numerous bad loans, which was further worsened by loose classification and provisioning standards, debtor-friendly legal system, stock market losses, industrial restructuring that generates more non-performers and by difficult domestic and international environments, Moody’s said in its annual report on India’s banking system.

“Moreover, the reform process initiated in 1991 slowed down three years later for political reasons, and the result is that plans for fiscal tightening, deregulation, and privatisation of the public sector banks has fallen behind schedule,” the report said.

In the absence of vigorous reform, robust unions make it very hard to streamline public sector banks because staff cannot be laid off or branches closed, Moody’s said.

At present the current average for the financial strength ratings of India’s rated banks was around an “adequate” D, or very slightly lower, which was above the averages of China and Egypt but below that of Turkey and the Czech Republic.

Director arrested for fraud
From Our Correspondent

NEW DELHI, Jan 13 — The economic Offences Wing of the Delhi Police today arrested the Director of Foremost Exims Limited, Aditya Vikram Modi (33), on the charge of cheating.

The suspect, Aditya Vikram, allegedly cheated Indomobil Limited, a Delhi-based joint sector company, of Rs 1 crore, police said.

Indomobil entered into an agreement in 1996 with Foremost Exims, and supplied lubricants to the latter. Payment were to be made into Indomobil’s account in the SBI branch at Kanpur.

The modus operandi of Aditya Vikram was to get the cheques bounced and submit them again and again in the bank and forward the counter foils of the bank pay-in-slip to Indomobil in Delhi to confirm the payments.

Punjab to be explored for oil
From T.V. Lakshminarayan
Tribune News Service

NEW DELHI, Jan 13 — Punjab has been identified among the States in North India as having a big potential for oil and natural gas exploration and plans are afoot to begin exploration works in these areas in a big way, sources in the Petroleum Ministry said here today.

Exploration work in Punjab will be undertaken as part of the Government’s strategy to undertake such an exercise in all the sedimentary basins of the region, the sources told TNS.

It is proposed that the ONGC or the Oil India Limited would be entrusted with the task of undertaking exploration.

Optimism about a good find in the region has been based on the success of Pakistan in hydrocarbon exploration. The neighbouring country reported several good gas finds last year.

Also, the recent discovery of potential in the Ganga valley in Uttar Pradesh has heightened the Ministry’s hopes of finding gas and oil in the northern region.

The Minister of State for Petroleum, Mr Santosh Gangwar, said here today that high potential has been identified in a village between Rampur and Udham Singh Nagar in Uttar Pradesh.

Oil India Limited, which has undertaken exploration work in the valley has gone 2761 metres deep in the village Peerkhera, near Udham Singh Nagar, and indications are that there are very good prospects of a find there.

OIL plans to go till 4250 metres before making a final assessment about the commercial discovery, a company official said.

Meanwhile, Petroleum Ministry officials said that they have sought a clarification from the Prime Minister’s Office on Mr Atal Behari Vajpayee’s statement on January 9, that the Government would consider giving further incentives for oil and gas exploration.

The Prime Minister’s statement at the inaugural ceremony of Petrotech-99 had created confusion in the Petroleum Ministry as the roadshows for 48 oil exploration blocks being offered for private participation under the new exploration licensing policy (NELP) are scheduled to begin on January 22.

The officials were of the view that the package of incentives already announced for the NELP was among the best in the world and they wondered what else the Prime Minister had in his mind when he made the fresh announcement.

U.S. $ Rs 42.48/49
Stg £ Rs 69.96/98
D. Mark Rs 49.57/59
Yen (100) Rs 37.96/98

The RBI reference rate was Rs 42.50

Gold falls
NEW DELHI, Jan 13 (PTI) — Both silver and gold reversed on the bullion market today, showing a weak trend on the emergence of selling by stockists in the face of restricted buying and closed with heavy losses. Today’s quotations: silver .999 n ready 7735 and delivery 7725. Silver coins buyer 10,500 and seller 10,600. Standard gold 4429, ornaments 4270 and sovereign 3750.

Greaves
NEW DELHI, Jan 13 (UNI) — Greaves Limited has joined hands with Piaggio S.P.A. of Italy to locally produce in India compact engines with in-built gearboxes for the three-wheelers which the two companies would be manufacturing under their joint venture. A new facility is being set up at Aurangabad in Maharashtra for the purpose at a cost of Rs 45 crore. “The engines, besides, being used for the ape range of vehicles being introduced here, would also be exported back to Piaggio’s facilities in Italy for use on the vehicles being produced there,’’ Greaves Limited Managing Director Shekhar Datta told UNI here.

Samsung
NEW DELHI, Jan 13 (PTI) —Korean major Samsung India Electronics Limited (SIEL) today launched its 1300 watt mini component audio system with the ‘unique’ sound retrieval system. Priced at Rs 17,500, the ‘Max 860’ model joins the three existing compact disc-based Samsung audio products which fall within the price range of Rs 9,000-17,500. said SIEL’s Managing Director K.S. Kim.

Packaging
NEW DELHI, Jan 13 (PTI) — The packaging industry is expected to boom with the introduction of stringent packaging norms, Indo-German Chambers of Commerce President Kamal Meattle said here today.