SPECIAL COVERAGE
CHANDIGARH

LUDHIANA

DELHI



THE TRIBUNE SPECIALS
50 YEARS OF INDEPENDENCE

TERCENTENARY CELEBRATIONS
B U S I N E S S

RIL’s German unit goes bust
New Delhi, June 3
The global economic downturn has hit India's most-valued company, Reliance Industries, forcing it today to declare as insolvent its German unit Trevira, a specialty polyester manufacturer.

Markets set for correction; Re, gold may harden
New Delhi, June 3
Stock market pundits have begun cautioning investors on today’s spirited rally on the bourses, which saw the BSE hitting the 15,000 mark before falling back. They maintain the dizzying upswing has completed its course and the markets might rise a little before undergoing a correction by at least 1,000-2000 points in the near future. This, they have warned, is a red flag.

Govt promises incentives for exporters
New Delhi, June 3
As exports dipped by 30 per cent in May, extending the fall to eighth month in a row, the government today reviewed the grave situation with top exporters promising them incentives.



EARLIER STORIES




Bollywood actress Asin smiles at a promotional event of a television dish system in Chennai on Tuesday.
Bollywood actress Asin smiles at a promotional event of a television dish system in Chennai on Tuesday. — Reuters

Local cheques to be cleared same day
Chandigarh, June 3
All scheduled banks will now be required to clear local cheques deposited with them on the same day or at the most next day without fail. The apex regulatory bank, Reserve Bank of India, in a circular issued yesterday to all banks, has stated that for local cheques, credit and debit will be given on the same day or at the most on the next day of their presentation for clearing.

BSE market cap touches $1 trillion
Mumbai, June 3
The Bombay Stock Exchange's market capitalisation has touched a record $1 trillion-mark, a value close to the country's GDP, riding on renewed investor confidence and appreciating rupee.

Chinese Co to drive away Hummer
A Hummer is displayed at a auto trading centre in Shanghai on Wednesday. — Reuters New York, June 3
Bankrupt General Motors is in advanced talks for selling its premium Hummer brand to Chinese group Sichuan Tengzhong Heavy Industrial Machinery for an undisclosed sum. The proposed transaction, which is expected to save as many as 3,000 jobs, was announced on Tuesday, a day after the iconic auto maker filed for bankruptcy protection.


A Hummer is displayed at a auto trading centre in Shanghai on Wednesday. — Reuters


Workers cast their shadows on a giant poster which reads "We are Opel" in the headquarters of German car manufacturer Opel in Ruesselsheim on Wednesday. Magna International Inc is prevented by an agreement with General Motors Corp from selling Opel cars in the United States and, for now, in China, the chairman of the Canadian auto parts company said on Tuesday.
Workers cast their shadows on a giant poster which reads "We are Opel" in the headquarters of German car manufacturer Opel in Ruesselsheim on Wednesday. Magna International Inc is prevented by an agreement with General Motors Corp from selling Opel cars in the United States and, for now, in China, the chairman of the Canadian auto parts company said on Tuesday. — Reuters

Commission Row
Explanation sought from airlines

New Delhi, June 3
The Directorate-General of Civil Aviation (DGCA) has written a letter to foreign airlines asking them to explain reasons for not giving commission or remuneration to travel agents when they are providing them with the service.

WB praises NREGA
New Delhi, June 3
The World Bank today praised the UPA government's National Rural Employment Guarantee Programme (NREGA) saying people can fall back on the scheme "in these hard times." "India is fortunate to have in place a (NREGA) program that people can fall back on to find work in these hard times", World Bank's Country Director Roberto Zagha said at a function to launch a book 'Social Safety Nets : Learning from Global Experience.'

L. Mansingh City gas distribution for Chandigarh on the cards
Chandigarh, June 3
The Petroleum and Natural Gas Regulatory Board (PNGRB) is all set to issue licences for city grid pipeline projects in seven cities, including Chandigarh. This process of supplied gas through pipeline will help reduce the government fuel subsidy.

HPCL to pump in Rs 614 cr for ethanol
New Delhi, June 3
Hindustan Petroleum Corporation Ltd (HPCL) will invest Rs 614 crore in the two sugar mills it had bought in Bihar to manufacture ethanol, which will be blended with petrol.

 





Top








 

RIL’s German unit goes bust

New Delhi, June 3
The global economic downturn has hit India's most-valued company, Reliance Industries, forcing it today to declare as insolvent its German unit Trevira, a specialty polyester manufacturer.

Reliance Industries had acquired Trevira five years ago for Rs 440 crore and group chairman Mukesh Ambani had announced the deal at the Annual General Meeting that year.

This acquisition in 2004 had propelled Reliance to the position of the world's largest polyester fibre and yarn producer. The German unit had 1,800 employees as of March 2009 and a turnover of Euro 323 million last year.

"Trevira filed an application with the Augsburg Court in State of Bavaria, Germany, for the commencement of insolvency proceedings with a restructuring plan," RIL said in a press statement here.

Reliance is the latest in the list of Indian conglomerates that have been hit by the financial tsunami on their global acquisitions.

Trevira is among the few prized acquisitions that the second generation of Ambanis executed after taking charge from their father late Dhirubhai Ambani, before the siblings Mukesh and Anil parted ways. The Trevira deal followed acquisition of Flag Telecom in early 2004 for $311 million.

Trevira faced severe demand contraction in its principal market segments due to the global financial crisis. — PTI 

Top

 

Markets set for correction; Re, gold may harden
Bhagyashree Pande
Tribune News Service

New Delhi, June 3
Stock market pundits have begun cautioning investors on today’s spirited rally on the bourses, which saw the BSE hitting the 15,000 mark before falling back. They maintain the dizzying upswing has completed its course and the markets might rise a little before undergoing a correction by at least 1,000-2000 points in the near future. This, they have warned, is a red flag.

The rally began on March 6 when the Nifty started its upward journey from the 2,500 point level. This might have been in response to the UPA’s victory in the general elections as well as improved sentiment in both the global and domestic economy, say marketmen. However, stocks have gone up by nearly 80 per cent during the past three months, with the Nifty touching 4,500 points, indicating there has been an irrational exuberance in the bullish market, they add, hence the necessary correction.

Some marketmen are of the view that the bourses, especially the Nifty, will touch the 4,650 level and then start undergoing a correction. A growth of 10 percent per month in the index is healthy but 80 percent over a three-month period is a matter of concern, they add.

However, foreign institutional investors continue to make a beeline for Indian markets. Capital flows to the country are expected to almost double to US $33.9 billion (Rs 1,59,003 crore) in the current fiscal from an estimated $17.3 billion in 2008-09, riding on an improved growth outlook, says financial services major Morgan Stanley in a report, adding capital flows in 2011 are expected to be around $41.3 billion.

The report stated that in line with the deterioration in the global capital market environment, capital inflows into India declined during the quarter ended December 2007, despite the attractive long-term investment prospects.

The currency markets are also upbeat with the rupee rallying towards the 47 mark against the dollar, again aided by a weakening greenback together with a buoyant equity market. Besides concerns about the risk of the US sovereign rating losing its ‘triple A’ status on a ballooning budget deficit and the dollar’s future as a global reserve currency have also weighed in.

These concerns have no doubt influenced FIIs to pump in close to $800 million in Indian markets over the last five sessions, helping somewhat in arresting the rupee’s decline when it slipped to 48 against the dollar.

The country’s bullion market also saw money flowing in as a safe haven, though the resistance is at $990 per ounce. Marketmen say the dollar’s current weakness is tied to overoptimism about the country’s economic and financial outlook and that other fundamental factors will soon put a lid on any gains. However, it is expected with India’s widening fiscal deficit gold is likely to touch Rs 16,000 per ounce. 

Top

 

Govt promises incentives for exporters

New Delhi, June 3
As exports dipped by 30 per cent in May, extending the fall to eighth month in a row, the government today reviewed the grave situation with top exporters promising them incentives.

"We will be giving incentives so that Indian exports will become competitive," Commerce and Industry Minister Anand Sharma told reporters after meeting heads of different export organisations, including commodity boards here.

Faced with slump in demand in key markets such as the US and Europe, India's exports plunged by 30 per cent in May as per the quick estimates, given by Commerce Secretary G K Pillai. The final figures will be released on July 1.

Exports fell the most in 14 years by 33.2 per cent in April to $10.74 billion in April 2009-10, from $16.08 billion a year ago.

"We do still expect negative trend, may be, till August," the Commerce and Industry Minister said.

Sharma said he would be meeting Finance Minister Pranab Mukherjee soon and make sector-specific recommendations and policy measures.

Mukherjee, who is to present the Budget for this fiscal in the first week of July, yesterday met exporters who briefed him about their difficulties.

Among other things, exporters seek a cut in the cost of credit. "Yes, there is a case to cut interest rates... we will be taking up this issue," Sharma said. — PTI

Top

 

Local cheques to be cleared same day
Sanjay Khurana
Tribune News Service

Chandigarh, June 3
All scheduled banks will now be required to clear local cheques deposited with them on the same day or at the most next day without fail. The apex regulatory bank, Reserve Bank of India, in a circular issued yesterday to all banks, has stated that for local cheques, credit and debit will be given on the same day or at the most on the next day of their presentation for clearing.

"Ideally, in respect of local clearing, banks shall permit usage of the shadow credit afforded to the customer accounts immediately after closure of relative return clearing and in any case withdrawal shall be allowed on the same day or maximum within an hour of commencement of business on the next working day, subject to usual safeguards," RBI said in its circular.

The central bank has fixed a time frame for collection of outstation cheques as well. The time frame for collection of cheques drawn on state capitals and major cities has been capped at seven days and 10 days, respectively. For all other locations, banks have to clear the cheque within 14 days.

If there is any delay in collection beyond this period, the bank has to pay the customer interest at the rate specified in the bank's cheque-clearing policy. If no interest rate is specified, the bank will have to pay interest at the rate on fixed deposits for the corresponding maturity.

Meanwhile, instructions have also been issued by RBI on the contents of Cheque Collection Policies (CCPs) framed by banks as also regarding publicity to be given thereto in the interest of better information dissemination and service to customers.

The banks have been asked to give publicity to the CCP by displaying salient features thereof in bold and visible letters on the notice board at its branches. A copy of the complete CCP shall be made available by the branch manager, if the customers want.

Top

 

BSE market cap touches $1 trillion

Mumbai, June 3
The Bombay Stock Exchange's market capitalisation has touched a record $1 trillion-mark, a value close to the country's GDP, riding on renewed investor confidence and appreciating rupee.

According to information available with BSE, the combined market value of all firms listed on the bourse rose to Rs 49,61,449.51 crore or over $1 trillion (calculated at an exchange rate of 46.83 rupees for a dollar).

This represents a sharp gain of over two-fold from $485 billion or Rs 24,10,256 crore on October 27 last year when the benchmark Sensex plunged to its 52-week low and the rupee was quoting at 49.74 against the greenback. — PTI 

Top

 

Chinese Co to drive away Hummer

New York, June 3
Bankrupt General Motors is in advanced talks for selling its premium Hummer brand to Chinese group Sichuan Tengzhong Heavy Industrial Machinery for an undisclosed sum.

The proposed transaction, which is expected to save as many as 3,000 jobs, was announced on Tuesday, a day after the iconic auto maker filed for bankruptcy protection.

According to the planned deal, General Motors in a statement on Tuesday said the Chinese industrial machinery group Tengzhong would acquire the rights to the premium off-road Hummer brand, along with senior management and operational team.

In a separate statement yesterday, General Motors had said it has entered into a "memorandum of understanding (MoU) with a buyer for Hummer, its premium off-road brand".

The car maker noted that the deal is anticipated to secure more than 3,000 US jobs in manufacturing, engineering and at Hummer dealerships around the country.— PTI

Top

 

Commission Row
Explanation sought from airlines
Tribune News Service

New Delhi, June 3
The Directorate-General of Civil Aviation (DGCA) has written a letter to foreign airlines asking them to explain reasons for not giving commission or remuneration to travel agents when they are providing them with the service.

The letter has asked 14 foreign airlines to reply within 10 days. The action came after travel agents and members of six associations, including the Travel Agents’ Association of India (TAAI), Travel Agents Federation of India (TAFI) and the IATA Agents Association of India (IAAI) met DGCA yesterday and demanded regulation to protect the travel agents and industry.

TAAI president Rajji Rai said DGCA’s letter asked foreign airlines to explain the transaction fee and the logic behind asking agents to take commission from consumers when it were the agents who were providing them with the service.

Most airlines have stopped paying the five per cent commission to agents from November, forcing them to shift to a fixed transaction fee on every ticket purchased. However, the fixed transaction fee, in the range of Rs 350 to Rs 2,500 a ticket depending on the class and routes, had also been discontinued from December, prompting agents to boycott booking of tickets of foreign airlines.

Rai said they were hopeful for a solution after this DGCA letter to foreign airlines. The ongoing tussle has not been good for business and that the agents should get their due for the services they provide to the airlines.

Incidentally, in December, the Karnataka High Court had held that the DGCA as the final authority to resolve the issue and asked the agents to submit a petition to it. 

Top

 

WB praises NREGA

New Delhi, June 3
The World Bank today praised the UPA government's National Rural Employment Guarantee Programme (NREGA) saying people can fall back on the scheme "in these hard times." "India is fortunate to have in place a (NREGA) program that people can fall back on to find work in these hard times", World Bank's Country Director Roberto Zagha said at a function to launch a book 'Social Safety Nets : Learning from Global Experience.'

Describing the NREGA scheme as an innovative programme, he said, "(it) is an important cushion for poor people living in rural areas who might be at risk of being pushed further into poverty." — PTI 

Top

 

City gas distribution for Chandigarh on the cards
Ruchika M. Khanna
Tribune News Service

Chandigarh, June 3
The Petroleum and Natural Gas Regulatory Board (PNGRB) is all set to issue licences for city grid pipeline projects in seven cities, including Chandigarh. This process of supplied gas through pipeline will help reduce the government fuel subsidy.

Talking to TNS here today, on the sidelines of a discussion on local natural gas distribution networks being organised by the board in association with CII, the chairperson of the board, L Mansingh, said they had successfully allotted the bids for city grid pipeline projects in Kakinada, Dewas, Sonepat, Mathura, Meerut and Kota. “The projects in five of these cities have been allotted to GAIL and its subsidiaries. We have now floated Expression of Interest (EoI) to invite bids for seven cities, namely Chandigarh, Rajamundri, Yanam, Shehdol, Jhansi, Allahabad and Ghaziabad. The last date for submission of bids is June 21, and till date 21 applicants have already submitted their bids. Each of these areas would require an investment of Rs 500 crore upon full implementation,” he said.

He said besides the technical and financial conditions, the board was also looking for a natural gas sourcing plan and experience in either laying pipelines or piping gas, before awarding these projects. The bid winners would enjoy 25 years exclusivity on infrastructure and gas marketing exclusivity of five years. After five years, the board would again invite bids for marketing of gas.

Mansingh said those cities had been chosen by the PNGRB which either have a pipeline network, or which are likely to come up on the pipeline network soon. “After the Dadri-Nangal pipeline is laid out by October 2010, spur lines will be laid and we should be able to start the city gas distribution project at Ludhiana, Mandi Gobindgarh and Jalandhar. The Punjab government is quite keen on the city gas distribution (CGD) network for Ludhiana, Amritsar and Jalandhar and we should be able to start this within the next two years,” he said.

The chairperson also said the board was now urging Punjab government to initiate a single- window clearance system for laying down the pipeline and spur lines. He said the state governments in Tamil Nadu, Andhra Pradesh and Gujarat had already appointed nodal agencies for setting up single-window clearances for these projects.

Top

 

HPCL to pump in Rs 614 cr for ethanol

New Delhi, June 3
Hindustan Petroleum Corporation Ltd (HPCL) will invest Rs 614 crore in the two sugar mills it had bought in Bihar to manufacture ethanol, which will be blended with petrol.

"The HPCL Board had a few weeks ago approved the investment proposal but due to the General Elections it was not implemented. The board was yesterday informed of the decision to go ahead with the investments," a company official said. The two plants will produce 60 kilolitres of ethanol per day, to be used to dope petrol.

"We are now tendering for plant equipment and the two units would be operational by 2010-end," he said.

India has mandated blending of ethanol in petrol to cut the country's dependence on imported oil. Currently, 5 per cent ethanol is doped in petrol and the percentage may be doubled in coming years.

HPCL had last year taken the two closed sugar mills from the Bihar government on a 60-year lease for Rs 95 crore. — PTI 

Top

 
BRIEFLY

NHPC public offer likely in August
New Delhi
: Hydro power firm NHPC Ltd is likely to launch its much-awaited Rs 1,670-crore initial public offer by August to part finance its expansion plans. "We are working on the NHPC IPO... hopefully it would hit the market in August," a senior power ministry official said. NHPC plans to issue 10 per cent of its new equity shares in the public offer, while the government alongside will divest its five per cent stake in the company. — PTI

US firm to buy into NSE
New Delhi
: The US-based private equity firm Norwest Venture Partners on Wednesday said it would pick up a little over 2 per cent stake in NSE, the country's largest stock exchange in terms of trading volume, for about Rs 252 crore, valuing the bourse at over Rs 12,000 crore. The equity firm has signed a definitive agreement to acquire 2.11 per cent stake for a consideration of about Rs 252 crore in the NSE, Norwest Venture Partners said. — PTI

ICICI Pru launch
Mumbai
: Insurance firm ICICI Prudential Life on Wednesday launched SecureSave, a product that enables customers to get the benefits of security and growth on their savings. Investors can avail a guaranteed maturity benefit up to 150 per cent of the sum of all premiums paid, a press release said. — PTI

Lucas Indian plan
New Delhi
: TVS Group firm Lucas Indian Service on Wednesday announced its foray into the organised car accessories retail market with plans to set up 108 outlets in the country over the next five years at Rs 180 crore. "The Indian car accessories market is estimated at Rs 4,500 crore and it will grow up to Rs 8,500 crore by 2014. To tap this market we will be launching three different formats of outlets across the country," Lucas Indian Service President Sandeep Abbi told reporters. — PTI

Top

 





HOME PAGE | Punjab | Haryana | Jammu & Kashmir | Himachal Pradesh | Regional Briefs | Nation | Opinions |
| Business | Sports | World | Letters | Chandigarh | Ludhiana | Delhi |
| Calendar | Weather | Archive | Subscribe | Suggestion | E-mail |