Washington, October 23
Maintaining that there is no turbulence in the Indian financial markets, the finance minister P. Chidambaram has said that the government of India has no intention to impose any kind of capital controls or keep out any kind of funds.

"There is no turbulence. It was an instant reaction by fund managers that some kind of restrictions are being placed on investments by foreign institutional investors," Chidambaram told PTI in an exclusive conversation.

He said the government has clearly mentioned that it has no intentions to impose capital controls, or to keep out any kind of funds.

"All we say is that instead of coming through a non-transparent route of participatory notes issued on the basis of overseas derivative instruments, please come in as FIIs and register in India," he added.

Yesterday, capital market regulator SEBI had said it has cleared 16 FII applications for registration and announced that it would allow proprietary sub-accounts to register themselves.

"It increases transparency. It also subjects these investors to due diligence by Indian authorities. I think the clarifications have gone home now," the finance minister said going on to reject the call of the Left parties in India to ban Participatory Notes (PNs).

"I don't think the Left parties have quite understood the complexity of the issues. It is a very simplistic call — ban participatory notes," said Chidambaram who is in Washington to attend the annual meetings of the International Monetary Fund and The World Bank.

The finance minister further reiterated that the Indian government would like the exchange rate to be competitive but went on to make the point that there is 'no choice' but to continue with the sops to exports in the face of an appreciating rupee.

"What choice do we have" the finance minister said when asked on the continuance of sops to exporters.

"If rupee continues to appreciate rapidly we have to extend some support to the exporters. There are other sections of the economy that will gain by the appreciating rupee, but exports will be hit and exports are important for us...

Therefore, we have given them support and if necessary we will give them support" Chidambaram said.

Asked if the the recent decision to put on 'hold' the US-India civilian nuclear deal will impact the financial markets, he said the decision would not have a direct impact on the financial markets of the country although there is bound to be some disappointment.

“Investors will come into the Indian market. I have no sense at all that investors will be deflected because of the difficulties the Indo-US civilian nuclear deal faces.” — PTI

Mumbai, October 23
Following assurances by market regulator SEBI chairman M Damodaran that the process of registering foreign institutional investors would be expedited, the Sensex today recouped last week's losses and recorded its biggest single-day gain of 878 points to close at 18,492 points.

In broader markets, Nifty moved up 5.6 per cent or 289 points to close at 5,473 levels.

Earlier, Damodaran proposed to speed up registration of FIIs though he hinted that the regulator was keen on implementing proposals on curbing issuance of participatory notes for investing in stock markets. SEBI has proposed an 18-month deadline of doing away with derivatives-based P-Notes.

Heartened by the proposed measures, the Sensex resumed its bull run with BHEL leading the charge. The scrip was up 11.5 per cent or Rs 237. Reliance Energy, NTPC, Bharti Airtel, Reliance Industries, Larsen & Toubro, HDFC Bank and Tata Steel were some of the other gainers.

However, today's losers included TCS which slipped 0.9 per cent at Rs 1,064. Ambuja Cements, Wipro, HDFC and Infosys Technologies were the other losers.

Among sectoral indices, the biggest gainer was the BSE capital goods index, which closed 7.7 per cent or 1,196 points higher.

Banking scrips too were among the big gainers with Bank of India, Kotak Mahindra Bank, Canara Bank and Yes Bank among the gainers.

New Delhi, October 23
The GSM cellular operators today said the new telecom guidelines, favouring only CDMA service providers, were framed in a "completely non-transparent manner" and adversely affects existing GSM players.

In its petition filed in telecom tribunal TDSAT challenging DoT's revised guidelines of October 19, the Cellular Operators Association of India (COAI) demanded that "all files of Telecom Commission relating to revised guidelines be placed before the tribunal".

On October 19, the government permitted use of dual technology and also accepted telecom regulator TRAI's recommendation of enhanced subscriber-linked criterion for allocation of additional spectrum.

COAI said DoT called for a meeting of Telecom Commission, headed by telecom secretary, on October 18. The meeting ended at about 6 pm and the in-principle approval was issued to CDMA operators within half an hour, COAI said in its petition.

COAI said the DoT acted with "undue and unseemly haste" to benefit one set of operators over the others, denying equal opportunity and level-playing field to GSM operators.

The main GSM operators include Bharti Airtel, Vodafone Essar and Idea Cellular, while the key CDMA players are RCoM and Tata Teleservices. Besides RCoM, Mahendra Nahata-promoted HFCL and Shyam Telecom have received DoT nod to start GSM services. TTSL has also applied for GSM spectrum. — PTI

New Delhi, October 23
State-run telecom giant BSNL today announced an investment of a whopping Rs 60,000 crore in next three years to expand its GSM, broadband and WLL services, a move that would help the PSU achieve top position by 2010.

"We will invest over Rs 20,000 every year till 2010 for expansion, which will include laying down additional lines for GSM, WLL and broadband," BSNL chairman and managing director Kuldeep Goyal told PTI in an exclusive interview.

Most of the investment would come through internal accruals as the PSU has sufficient reserves, he said but did not rule out market borrowing at a later stage.

"I don't think we would need to go to market at least for one year," he said.

Although BSNL's profits would come under severe pressure as subsidy on rural operations has been withdrawn and the levy charged from private players (known as access deficit charge) would also be phased out from next year, yet Goyal was hopeful of meeting the requirement internally.

From a subscriber base of over 30 million mobiles now, representing a market share of about 22 per cent, BSNL is aiming to regain third position after Bharti Airtel and Reliance Communications in the near future as it hopes to get additional capacity by January 2008.

"By 2010 we have planned to become number one GSM player with at least 33 per cent market share. The government has a target of 500 million connections from about 240 million now. We have plans to add about 100 million new subscribers by then," Goyal added.

The PSU has been losing market share since last one year due to delays in adding capacity in GSM mobile and it was pushed to number four in the list of mobile operators after Bharti Airtel, Reliance Communications and Vodaofne Essar.

On the expansion front, BSNL would also add 2 million lines to provide broadband on Wimax technology while another 2 million lines for broadband would be added on copper wires. It would also augment its capacity of WLL by 3 million lines.

"With these 4 million lines for broadband, we will cover about 50,000 villages across the country," Goyal said.

The company has already invited Expression of Interest for the Wimax project which is likely to be worth around Rs 2,000 crore. — PTI

Mumbai, October 23
Reliance Money, promoted by the Anil Dhirubhai Ambani Group, today unveiled a zero brokerage fee plan to rope in more subscribers for its stock market trading venture.

The company said here today that it hoped to tap potential investors numbering more than 30 crore.

Under the scheme unveiled by Reliance Money, subscribers who sign up for its demat account would be allowed to buy and sell shares worth Rs 5 lakh for the first year without paying any brokerage.

The company had started its business last year offering a flat fee of Rs 500 for trading up to Rs 5 lakh per year.

Demat account holders can trade in stocks, commodities and other instruments.

Reliance Money has further sweetened its offer by letting high volume traders exceeding Rs 5 lakh to make trades worth Rs 1 crore in two months or Rs 6 crore in one year by paying a flat brokerage of Rs 500 and Rs 2,500, respectively.

New Delhi, October 23
Haryana, Delhi, Orissa, Chhattisgarh, Gujarat, Tamil Nadu and Karnataka are among the best performing states in terms of their financial health, while Bihar, Jharkhand and Kerala need to put their house in order and cut both fiscal and revenue deficits, an Assocham eco-pulse study has revealed.

In a study on ‘Fiscal position of states’, it has been revealed that Haryana had the minimum fiscal deficit of 0.6 per cent in 2007 though marginally up from 0.3 per cent in the previous year.

Delhi appeared at the second position with 0.7 per cent fiscal deficit while its revenue account showed a surplus of 3.57 per cent. Though Orissa recorded the fiscal deficit of 1.1 per cent in 2007, higher than 0.4 per cent in 2006, it managed to remain well under the three per cent figure as recommended by the 12th Finance Commission.

Gujarat (2.5 per cent), Chhattisgarh (2.6 per cent), Tamil Nadu (2.7 per cent) and Karnataka (2.8 per cent) are the other states, which have been able to keep their expenditures in the financial year 2006-07 in line with the target of three per cent fiscal deficit.

But in view of the continuous high fiscal and revenue deficits witnessed by the states of Bihar, Jharkhand and Kerala, the financial stability of these states may become a matter of concern, the study said.

The study is based on the data provided from the RBI, ministry of finance and budget documents of the states.

Bihar, which tops the chart on this count, has seen a rise in the fiscal deficit from 6.1 per cent in the financial year 2005-06 to 10.4 per cent in 2006-07.

The revenue earnings also fell short of the revenue expenses by 1.14 per cent in 2007.

“There are many factors, which can be attributed to the wide fiscal gap in some of the states, including growing interest payments, pension liabilities, unrestrained administrative expenditures, low growth in tax collections”, said Venugopal Dhoot, president, Assocham.

Jharkhand is also facing the problem of huge fiscal deficit of 10.1 per cent in 2007, though it has recorded a marginal decline from 10.3 per cent in 2006.

Kerala is facing huge budgetary imbalances with the fiscal deficit rising from 3.5 per cent in 2006 to 6.1 per cent in 2007 and revenue deficit burgeoning to 4.36 per cent in financial year 2007 from 2.6 per cent in the previous year.

New Delhi, October 23
At a time when the Congress-led UPA government and the corporate world is going gaga over high and fast GDP growth rate, ‘Alternative economic survey, India 2006-07’ has warned the government against following “corporate-centric” policies, which they believe would not only spread misery and deprivation, but stifle the capabilities of many coming generations.

“Any policy that privileges tiny top of the Indian socio-economic pyramid (read as corporates), makes a massive draft on the entire social resources in the name of wealth creation,” the survey titled ‘Pampering corporates, pauperising masses’ said.

The survey comprises write-ups of over a dozen eminent economists, including Kamal Nayan Kabra, Arun Kumar, S P Singh and RK Mishra on various aspects of economy.

Contrary to the general assertion that faster growth results in pulling more people above the poverty line, the survey argues that “the fast growing sectors touch the lives of only a few per cent of the work force and most of the population is left out of this growth process, especially marginal farmers and workers in the unorganised sector.”

“On an average, corporate profits have risen more than 30 per cent since 2001-02 while nominal GNP has increased at an average of 11 per cent. The share of the corporate sector in the national income has risen by 290 per cent between 2001-02 and 2006-07,” it said.

Hyderabad, October 23
Satyam Computer Services, India's fourth largest IT company, has outperformed market expectations, posting a 27.9 per cent rise in net profit at Rs 409 crore for the second quarter ended September 30, and sounded bullish on acquisitions.

The company earned total revenues of Rs 2,031.7 crore, accounting for an year-on-year increase of 26.80 per cent and a sequential rise of 11 per cent.

The net profit in the corresponding period last year was Rs 319.81 crore. The EPS (earning per share) rose by 25 per cent and touched Rs 6.12 during the Q2.

The New York Stock Exchange listed company also declared an interim dividend of Rs 1 per share.

"Satyam continued its rapid growth across sectors and regions, including financial services, energy, utilities and telecommunications, media and entertainment. This quarter has seen highest growth rate in dollar terms," the company chairman B. Ramalinga Raju told reporters after the board meeting.