Services wing may be merged with DoT
Paswan to meet 6 unions today
Telco, Fiat rule out price cuts
Siticable lines up digital backbone
London bourse bid to win over Zee, Wipro
Foreign Exchange, Bullion, Stock Indices

 
 
SERVICES WING MAY BE MERGED WITH DOT 
 
 
FROM M RAJENDRAN
 
New Delhi, June 26 
The corporatisation of the department of telecom operations (DTO) is likely to be preceded by a merger of the department of telecom services with department of telecommunications (DoT).

If this happens, it will give DoT a disproportionately large role in matters related to procurement of equipment, besides transferring to it the powers to make key decisions. The prospect has raised fears of another strike by the technocrats of the ITS cadre, who feel their place and position is being undermined by the generalist IAS officers desperate to keep the plum job.

“Don’t be surprised if there is another round of strikes for giving certain powers to the DTO secretary. Since DTS will have little to do after its corporatisation, there is a proposal to merge it with the DoT, which will retain the prerogative of finalising important matters such as procurement and the launch of new services. This may be resisted by ITS officers,” sources in the communications ministry said.

According to a senior official in the ministry, there is a possibility that the DTS may even be scrapped within a few months. “The arrangement will be similar to a proposal made by the minister of state for communications, Tapan Sikdar. He had suggested that a post of a special secretary in DoT be created for an IAS officer while the DTS be headed by a technocrat. The special secretary would be in charge of the management while the DTS secretary would head the Telecom Commission and take policy decisions,” the official said.

However the proposal needs Cabinet approval to be implemented. If cleared, the DTO would be relegated to a company, whose powers will be limited to technical matters. DoT would continue to wield control over DTO on matters relating to procurement and the introduction of new services.

Meanwhile, the Associated Chamber of Commerce and Industry of India (Assocham) today said the bifurcation of DTS would result in further delays in the clearance of proposals.

“How many new windows will be opened up for industry and subscribers to get matters sorted out? These are genuine apprehensions the government should respond to. We would have been happy if the existing system would have been streamlined and points of delays reduced,” said P. K. Sandell, who heads the chamber’s expert committee on telecom and is the president of the Telecom Industry Services Association .

The government on Sunday wilted under the pressure of striking ITS officers and split the DTS into the department of telecom operations and department of telecom service to accommodate an ITS officer as a secretary in a department that has become the theatre of conflict between the two cadres.

The communications minister has said the work allocation between the DTS and DTO would be finalised after consulting Prime Minister Atal Behari Vajpayee and the Cabinet secretariat.    


 
 
PASWAN TO MEET 6 UNIONS TODAY 
 
 
FROM OUR CORRESPONDENT
 
New Delhi, June, 26 
The Union communications minister Ram Vilas Paswan will hold a meeting with six telecom employees unions tomorrow. These unions are yet to call off their proposed one day strike on June 28.

The decision was taken after talks between the officials and the striking employees failed today concerning the pensions, the fifth pay commission report and corporatisation. According to a joint statement issued today by six telecom unions, they have resolved to go ahead with the proposed one-day strike on June 28 against corporatisation.

However, four organisations —Indian Telecom Services Association, Telecom Engineers Officers Association, National Federation of Telecom Employees and Bharatiya Telecom Employees Federation—have withdrawn from the strike following a request by the communications minister.    


 
 
TELCO, FIAT RULE OUT PRICE CUTS 
 
 
FROM OUR CORRESPONDENT
 
Mumbai, June 26 
Fears that price warrior Maruti Udyog would ignite a war in the fiercely competitive car industry receded today after Telco and Fiat India decided not to return the fire by declaring that their models will cost the same. On Saturday, Maruti slashed prices of its 800 models, Omnis and the newly introduced Wagon R.

“We do not propose to lower the prices of Tata — either now or in the immediate future,” Rajiv Dube, general manager (commercial) of Telco’s passenger car division, said.

A Fiat India spokesperson echoed similar feelings, saying the company had no reason to slash prices. “Manufacturers have to keep prices stable to maintain their brand image, and to ensure customer protection. If we cut rates, new customers will feel cheated,” he said.

Analysts, however, say the real reason why the new entrants are not retaliating is that price cuts will prolong their gestation periods and upset their break-even plans. “Already, Maruti’s competitors are operating at low margins in a buyers’ market,” an industry observer said.

The confusion over uniform sales taxes is also holding back auto majors from picking up the gauntlet thrown by Maruti. Most new companies are operating on wafer-thin margins and unlike Maruti, which has a fully-depreciated plant at Faridabad, are not in a position to ramp up volumes.    


 
 
SITICABLE LINES UP DIGITAL BACKBONE 
 
 
BY PALLAB BHATTACHARYA
 
Calcutta, June 26 
Siticable, a wholly owned subsidiary of Zee Telefilms, is planning to invest Rs 10,000 crore through its investment vehicle, Zee Interactive Multimedia (ZIML), in a project to lay hybrid fibre coaxial network in 100 cities. In terms of cost and scope, the media major’s plan rivals the Reliance group’s decision to execute a similar project.

ZTL’s chief executive officer, Dev Naganan, told The Telegraph that the three-phased project would be completed in five years. “It will create the much-needed backbone for our other projects such as cable and internet services,” Naganan said. Zee’s cable and ISP businesses will have access to the backbone, which will be maintained by ZIML, a senior Siticable official said.

ZIML, recently set up by Siticable as its 100 per cent subsidiary, will consider the options to raise money for the project. “The HFC network will be funded through a mixture of debt and equity,” Naganan said. Though he was cagey on details, sources in Siticable said the company had drawn up plans to garner the funds through private placement.

“The company is weighing various options, including private placement of equity to raise funds for the project. Financial institutions are also being approached,” they said, adding the company does not plan a public issue in the immediate term.

The first phase of the project, which will connect the four metros and 20 other cities including Calcutta , will be completed in 18 months. Around Rs 100 crore will be invested in the city’s HVC network over a period of 18 months.

Siticable will also pump in Rs 10 crore to beef up its distribution system in the city. The company, which has a subscriber base of over two lakh in the city, has set an ambitious target of servicing 50 per cent of all cable subscribers. At present, RPG Netcom has the largest subscriber base of 4.2 lakh households. “This means we have to get at least 3.5 lakh subscribers in the next couple of years,” sources said. “Once the optic-fibre network is in place, we will be able to corner 50 per cent of Calcutta’s cable TV market,” they added.

Meanwhile, ZTL has decided to shelve the entertainment projects worth Rs 100 crore announced by its chief, Subhas Chandra, at the Destination Bengal meeting last year. These would have covered Calcutta, Siliguri and Durgapur.    


 
 
LONDON BOURSE BID TO WIN OVER ZEE, WIPRO 
 
 
FROM NITHYA SUBRAMANIAN
 
New Delhi, June 26 
With Indian companies making a beeline for the US markets to raise capital, the London Stock Exchange has embarked on an extensive marketing drive to woo corporates like Zee and Wipro to the bourse.

The current visit of LSE officials is aimed at diverting the tech flow to the exchange.

Members of the LSE are likely to meet 30-40 corporates in Delhi, Calcutta, Hyderabad, Chennai and Mumbai during their current trip.

In Calcutta, the team is likely to hold talks with caltiger.com which has already announced its plans of a public offering. Other big corporates on their list could include Wipro, Zee and NIIT.

Speaking to The Telegraph, Caroline Goodman, global business development head of India, West Asia, Africa and Turkey, said, “While the US markets are the rage, we have more Indian companies on the LSE compared with the US bourses.”

The LSE boasts of 20 Indian companies as against just five on the US exchanges — two on the Nasdaq and three on the New York Stock Exchange (NYSE).

“This year itself, three Indian companies have come to the LSE,” she added. While SSI and Tata Tea have already accessed the market this year, Aptech is the third entrant. “We are keen to attract more international business to the London Stock Exchange. We want more Indian companies to raise capital from the London markets,” Goodman said.

Unlike the US markets which are more focused on the domestic markets, the LSE has a turnover of $ 4 trillion from international business against $ 2.3 trillion from domestic business.    


 
 
FOREIGN EXCHANGE, BULLION, STOCK INDICES 
 
 
 
 
Foreign Exchange
US $1	Rs 44.66	HK $1	Rs 5.66*
UK £1	Rs 66.95	SW Fr 1	Rs 26.56*
Euro	Rs 41.61	Sing $1	Rs 25.40*
Yen 100	Rs 42.35	Aus $1	Rs 26.10*
*SBI TC buying rates; others are forex market closing rates

Bullion

Calcutta		Bombay
Gold Std (10gm)	Rs 4595	Gold Std (10 gm)	Rs 4530
Gold 22 carat	Rs 4340	Gold 22 carat	Rs 4190
Silver bar (Kg)	Rs 7850	Silver (Kg)	Rs 7915
Silver portion	Rs 7950	Silver portion	Rs 7920

Stock Indices

Sensex	4670.09	-51.61
BSE-100	2372.60	+8.97
S&P CNX Nifty	1451.65	-20.95
Calcutta	128.51	-2.69
Skindia GDR	NA	NA
   
 

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