Monday mayhem on markets
Bets riding on cricket bosses
Chair price-punch floors govt
Lawyers’ strike illegal: HC
Sinha’s Fab Fourteen hardsell India Inc
Calcutta weather

 
 
MONDAY MAYHEM ON MARKETS 
 
 
OUR BUREAU AND AGENCIES
 
April 17 
Spooked by fears that the bubble may have burst on New York’s exchanges, panicky investors unleashed a wave of selling that savaged stock markets from Tokyo to London, and Bangkok to Mumbai and brought back painful memories of another Black Monday — October 19, 1987 — when the Dow Jones Industrial Average had plunged by 508 points and sent world markets into a tailspin.

Rattled by last week’s record losses on Wall Street, investors in Tokyo today hammered stocks that saw Nikkei plunge 6.89 per cent to close at 19,008.64, its lowest close since January 25. “It’s like catching a falling knife right now,” said Darrell Whitten, head of research at ABN Amro in Tokyo.

In Mumbai, the selling avalanche knocked 291 points off the sensex and wiped out a staggering Rs 19,991 crore of shareholder wealth, leaving behind a messy trail of battered shares and bruised investors.

Like in the US, it was the infotech bell-wethers that went through the shredder. Almost all shares, including those of Big Daddies like Infosys, Satyam and Wipro, hit their lower-end circuit filters minutes after they opened for trading. They remained frozen there for the rest of the tumultuous session.

The 30-scrip sensex opened in a trough at 4797.95 but recovered a little when it hit its intra-day high of 4899.54, and closed at 4880.71 — down 291.42 points, or 5.63 per cent, over Thursday’s finish of 5172.13.

As the day wore on and operators counted their losses, most eyes were riveted on the trends at Nasdaq, which seem to be driving local markets more than they ever did before. “The influence Nasdaq has on the local scene is total,” said BSE’s Ramesh Damani.

The collapse on the world markets was triggered by last Friday’s double whammy when the Dow fell 617.78 points, or 5.7 per cent, its biggest one-day drop ever, and the Nasdaq slithered 355.49 points. Spurring the rout was economic data that showed US inflation running at the fastest in five years.

After the Tokyo close, ruling coalition policy chiefs agreed to recommend pumping 1 trillion yen ($ 9.7 billion) in public funds into the stock market if the market continued to plunge.

The dirge was heard in rest of Asia too with Hong Kong’s Hang Seng index tumbling 1380.39 points, or 8.55 per cent, to 14,762.37, its second largest one-day point loss in history. “I had no idea this thing could be so bad,” said Mark Mobius of Templeton Franklin Investment Services.

But after the carnage swept through much of Europe — its largest stock market in London suffered a 4.1 per cent fall in the benchmark FTSE 100 — a semblance of sanity returned as Wall Street rebounded. By mid-day, the Dow Jones industrial average was up 88.42 points at 10,394.19, having quickly recovered from an early 26-point dip. The composite index of the Nasdaq — home to the world’s technology stocks whose popularity has evaporated over the past few weeks — also surged 80.68 at 3,401.97 after erasing an early 94-point drop.

Although US investors showed some renewed interest in many of the biggest and most popular names that tumbled last week, the overall bias remained negative, with declining issues outnumbering advancers by a 3-to-2 margin on the broad market.

In currency dealings, the dollar moved sharply lower after jittery investors were alarmed by the sharp drop in US stock prices. The crash sparked a rally in gold prices — but it did not last for long.    


 
 
BETS RIDING ON CRICKET BOSSES 
 
 
FROM LOKENDRA PRATAP SAHI
 
Calcutta, April 17 
Jagmohan Dalmiya, the International Cricket Council president, is more reticent than he ever has been.

Dalmiya isn’t even willing to talk at length about playing host to the Board of Control for Cricket in India (BCCI) office-bearers tomorrow.

“All I’ll say is people expect quite a bit from our meeting... We (the officials) are aware of that,” he told The Telegraph.

Having upped the ante by this one remark alone, Dalmiya will have to take the lead in ensuring “expectations” aren’t belied.

The BCCI has been slow in reacting meaningfully, even though allegations have surfaced from different quarters. Hopefully, that will be rectified tomorrow.

Significantly, as a fall-out of the Hansie Cronje scandal, the BCCI is under pressure from former president Inderjit Singh Bindra and Union sports minister S.S. Dhindsa.

For his part, Dalmiya has already moved on the ICC-front: Come May 2-3, and the Executive Board (where all nine Test-nations find representation) will meet in London to “respond” to the current crisis.

That may still not satisfy everybody, but the ICC has at least indicated it won’t now merely wait and watch. Tomorrow, the BCCI will have to do one better. Otherwise, the impression it probably has something to conceal will get confirmed.

As Delhi police, which unearthed the Cronje scandal, continues to earn kudos, many within the BCCI feel a formal request must immediately be made to “expand investigation”.

In other words, should any Indian be involved in match-fixing, the BCCI will be only too happy to see him nailed —- by Delhi police.

Punishment inflicted by the BCCI could well amount to a life ban, should a player be booked.

Of course, BCCI president A.C. Muthiah may favour involving the Central Bureau of Investigation, but he could be persuaded to endorse the current thinking.

In any case, the BCCI can’t directly ask the CBI to step in.

Indications are the BCCI will, tomorrow, make the Justice (retd) Y.V. Chandrachud inquiry report public.

“Though it was an in-house affair, Justice Chandrachud threw out Manoj Prabhakar’s (match-fixing) allegations. Therefore, there’s nothing very sensitive. It’s in the BCCI’s interest to take the report out of its archives” is how a source put it.

On the cards, too, is a “tough” stand on Bindra’s so-called revelations. The obvious question is: Why did he keep quiet all this time? Moreover, what information was Bindra privy to during the years (1993-96) he was himself BCCI president?

It will come as no surprise if Bindra finds himself marginalised even more.

There is talk as well that the BCCI may return to the days of a formal contract with players.

Though the players are informed of 18 dos and don’ts, on being selected, contracts were done away with after the Supreme Court intervened on behalf of six seniors in 1989. Now, it could all change and a “specific don’t” may well bar interaction with dubious characters and financial speculation of any kind.

Among those present tomorrow will be BCCI joint-secretary Jyoti Bajpai, who favours the declaration of assets by all who make the India squad. It’s a suggestion worth adopting.    


 
 
CHAIR PRICE-PUNCH FLOORS GOVT 
 
 
FROM OUR SPECIAL CORRESPONDENT
 
New Delhi, April 17 
The second innings of the budget session began in embarrassment for the government as the Lok Sabha Chair pulled it up for bypassing Parliament to increase the price of cooking gas and kerosene.

“The House should have been taken into confidence. The House was not prorogued and the budget session was still on when the hike was announced,” presiding officer P.H. Pandian said. Pandian, leader of the ADMK parliamentary party, was in the Chair in the absence of both the Speaker and the Deputy Speaker.

The unexpected afternoon bolt followed a severe onslaught from the Opposition, which, with tacit backing from the BJP’s allies, grilled the government on the escalating prices of essentials. Led by the Congress, the Opposition parties walked out after Speaker GMC Balayogi rejected their demand for an adjournment motion.

The Opposition drew sustenance from the National Democratic Alliance partners’ unhappiness with the BJP for the price spiral. “The NDA is supporting us,” declared CPM leader Somnath Chatterjee. Alliance leaders Yerran Naidu (Telugu Desam), Devendra Prasad Yadav (Janata Dal-United) and Raghunath Jha (Samata Party) sat through the din instead of trying to rescue the government. The treasury benches were thinly attended as most BJP members were at the Prime Minister’s rally at the Red Fort grounds.

Worse was to follow for the government as Pandian delivered his knockout punch later in the day after petroleum minister Ram Naik made a statement ruling out a rollback of the price increase.

The Centre had raised the prices of kerosene, cooking gas and aviation turbine fuel on March 23 when the budget session was in recess.

Asking the government to follow constitutional conventions, Pandian said: “From the Chair, I give the ruling that during the recess, the House should have been taken into confidence on the price hike as it was in session.”

As stunned treasury members objected to the ruling, a furious Pandian warned them that as Speaker of the Tamil Nadu Assembly, he had even got ministers thrown out.

Amid cheers from the Opposition and jeers from the treasury, Pandian asserted: “If my ruling is not in consonance with constitutional conventions, tell me...I will reverse it.”

An embarrassed Naik tried to put a lid on the controversy. “We are not objecting to your ruling but since members are agitated, I can only request you to revise it,” the minister said. Pandian did not pay heed to the request.

Naik, in his statement, justified the price increase, saying it was the only way to reduce the staggering oil pool deficit.

The minister’s explanation followed the morning uproar over the adjournment motion, which, according to Congress president Sonia Gandhi, “will help in awakening the government’s conscience”.

“There has been a 60 per cent hike in prices of wheat and rice. Prices of essential commodities sold through the public distribution system have shot up,” Sonia said.

The Speaker dismissed the demand for an adjournment motion.    


 
 
LAWYERS’ STRIKE ILLEGAL: HC 
 
 
FROM K. SUNIL
 
New Delhi, April 17 
Lawyers, on a strike for 55 days received a jolt today, with Delhi High Court declaring it as “illegal”.

A division bench while hearing a public interest litigation said: “Lawyers cannot go on strike infringing fundamental right of a litigant for speedy trial.” The Centre was pulled up for its failure to penalise the police officers who beat up the agitating lawyers on February 24.

The court ordered the suspension of 11 officers who would be “identified” by it. The high court also ordered for the transfer of DCP Pranab Nanda and three other senior officers. The suspensions and the transfers were ordered to “give a free and impartial hand” to the commission of inquiry instituted by the Centre to probe the lathicharge incident.    


 
 
SINHA’S FAB FOURTEEN HARDSELL INDIA INC 
 
 
FROM K.P. NAYAR
 
Washington, April 17 
Finance minister Yashwant Sinha, the first Indian minister to visit the US in the afterglow of the Clinton visit, is using a new medium for his message: 14 exquisite Indian models.

Visiting New York and Washington during the weekend, Sinha did something unusual — yield the spotlight to models such as Noyonika Chatterjee, Bipasha Basu and Ujwala Rawat instead of hogging all of it for himself as politicians are used to doing.

If President Bill Clinton changed the lasting image in this country of India as a land of roaming cows and snake-charmers into one of village milkmaids throwing rose petals on the world’s most powerful head of state, the attractive models who came with the finance minister helped concretise that image.

As the models did the catwalk at “India Investment Roadshows” here and in New York, Sinha let the show acquire its own message of a new partnership which goes beyond the routine, and somewhat frayed, calls for US investment in India.

Sinha said as much at Symposia and other meetings organised to interact with the American business community. “I am not here, quite frankly, to plead with you to invest in India. I am here to develop a new partnership between the US and India, a partnership about which the heads of governments of the US and India talked about recently,” he said.

Stating that his brief was to build on the vision which was captured by Clinton and Prime Minister Atal Behari Vajpayee, the finance minister said the emphasis was now on the people of the two countries, not just the two governments.

“It is a matter of great hope that the potential for partnership between the two countries has been realised not only by the two governments but also by the people of the two countries,” he said.

Sinha, who is leading a 20-member delegation which includes Rahul Bajaj, president of the CII, K.K. Modi, president of Ficci, and secretaries to key economic ministries, acknowledged that he was visiting the US in a different “mode and mood”.

“The sum total of our relationship would encompass not only the new economy, but also the possibilities in the old economy as well as what I call the older economy of India that is agriculture or bullock-cart economy,” the minister said.

If the roadshows went off well and the effort by the models may spin off into business gains in an economy where Indian textiles have made a mark, Sinha’s other brief here — to attend the spring meetings of the World Bank and the IMF — was a far from comfortable experience.

Faced with huge protests against multilateral lending institutions, tear gas and pepper spray used by the Washington police against the demonstrators, Sinha and his delegation had to sneak into the conference venue at 5 am for meetings which were scheduled to begin only later in the day.

Once the delegations were in, they had to barricade themselves in the World Bank building, which has become a veritable fortress, to prevent a repeat of the disruptions at the WTO Conference in Seattle last year. As a result, a press conference which was to have been held by the Indian delegation on the World Bank-IMF meetings on Sunday had to be called off.    


 
 
CALCUTTA WEATHER 
 
 
 
 
Temperature: Maximum: 35.1°C (-1) Minimum: 26°C (+1) RAINFALL: Nil Relative humidity: Maximum: 92%, Minimum:59% Today: Partly cloudy sky, with possibility of development of thunderclouds towards afternoon. Slight rise in maximum temperature, likely to touch 36°C. Sunset: 5.54 pm Sunrise: 5.16 am    
 

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