Convergence blow to ministries
Yadav secures support against Air-India selloff
Infotech thrust to exports
Bishnauth Tea gets BM Khaitan as its MD
Rupee slips to 45.69
Alstom plans to sell surplus real estates
IDBI Bank weighs another issue
Foreign Exchange, Bullion, Stock Indices

New Delhi, Aug 22 
It is the latest buzzword: compuhonavision, or the convergence of technologies. It has been coined by a draft convergence Bill that aims to prune the powers of the three powerful ICE ministries — infotech, communications and broadcasting.

“The dream of convergence is now fixed on the image of an all media machine that will roll into one the functions of telephone, TV and the computer,” says the report of the sub-group on convergence headed by Fali S Nariman.

That also provides the alibi for curtailing the powers the three ministries. The Bill will be a sort of an omnibus legislation that will combine the provisions of the Telecom Regulatory Authority of India (Trai) Act, Indian Telegraph Act 1885, Cable TV Act and the Wireless Act. The convergence bill to be called, “Communications (Carriage and Content) Bill, 2000” will amend most of the existing communications and IT legislations.

The group has also suggested setting up of a single independent statutory commission. One of the statutory functions of the commission will be to issue all licences including “composite licences”. Both measures are designed to limit the role of the three ministries.

It has stressed the need for constant and on-going mutual consultation to ensure that no single agency has overriding powers nor creates conditions which are inimical to the growth of IT and the IT-based industry: without in any way compromising the country’s basic security requirements.

“Not only will the provisions of the Trai Act be replaced, but also the provisions contained in the 1885 Indian Telegraph Act, the 1933 Wireless Telegraphy Act and the 1995 Cable Television Networks Regulation Act, will be rendered superfluous, and will stand repealed,” the report says.

However, neither telecom regulator nor the appellate tribunal constituted under the Trai Act stand abolished: they only stand transferred to and become part of the new enactment, according to the report.

According to the sub-group, the regulatory structure and mechanism of the new legislation should be sufficiently flexible to adapt to new developments in the fast-changing environment. It has suggested subordinate legislations to rules and regulations promulgated, from time to time, to meet the changed situations that arise in the future on account of rapid and unpredictable changes in information technology, as well as on account of (and to address) problems faced by the industry, both in respect of the carriage and the content of all transmitted information.

The group has also suggested minimal interference by the regulator to promote a way to deal with news, views and interaction.

The report has warned against unlimited interference by the regulator to avoid the risk of ad-hoc political involvement in economic regulation. “Unlimited interference would also influence adversely the ability of companies to invest and operate in a settled climate. This principle is even more significant and sensitive in connection with the regulation of content,” says the draft report.

The single independent statutory authority will be headed by a chairperson and whole-time members will be appointed from among persons of eminence with more than 15 years of experience in the fields of broadcasting, telecommunications, satellite technology, information technology, administration and management including financial management, and/or law.

“The committee for appointment should also include the Leader of the House in the Rajya Sabha and Leader of the Opposition in the Rajya Sabha, and the chairperson and members, except the ex-officio members, shall be appointed by the President of India on the recommendation of a committee consisting of the Prime Minister, the leader of opposition in Lok Sabha; leader of the house in the Rajya Sabha, leader of the Opposition in the Rajya Sabha, the minister in charge of information and broadcasting, and minister in charge of communications in the Central government.”

The draft report also proposes to set up a common appellate tribunal dealing with telecom as well as broadcasting and other matters to be regulated by the Communications Act, 2000.

The appellate tribunal will adjudicate the disputes between the licensor and the licensee and shall consists of a chairperson, vice chairperson and not more than six members with a provision enabling the appellate tribunal to perform its function through benches of one or two members with a view to settling the disputes expeditiously.

The chairperson and every other member of the appellate tribunal will serve a term of five years as against three years for the exiting members of appellate tribunal of TRAI.

To ensure rapid growth of IT or IT based industries, there is a need for quick and transparent allocation of bandwidth spectrum. The report notes that spectrum constitutes a scarce resource and can rarely be allocated on an exclusive basis. For optimum utilisation, it has to be shared between different users depending on spatial separation and equipment characteristics.    

New Delhi, Aug 22 
Clouds have started gathering over the proposed divestment in Air-India. And if anyone is happy about the fresh turn of events, it is no other than civil aviation minister Sharad Yadav.

For months, Yadav had been fighting Prime Minister Atal Behari Vajpayee’s effort to hasten Air-India’s selloff but met with little success.

Today, however, he found to his sweet surprise that, after all, he was not alone and found two allies — one in the powerful all party standing committee on transport and another in the informal caucus formed by ‘Swadeshi-minded’ BJP members of Parliament.

The standing committee which has several hardline BJP and Shiv Sena MPs on its rolls has endorsed Yadav’s stand almost a verbatim.

They feel ideally Air-India should not be sold off. And if it has to be sold then not more than 25 per cent should be flogged to a foreign partner as this would deny the foreign airline the right to block board resolutions.

Yadav had been saying this in various Cabinet meetings for quite a long time but saw himself outmanoeuvred and eventually outvoted in all cases.

As a result, the government could carry through its decision to sell a 40 per cent stake in Air-India, including a 26 per cent stake to a foreign strategic buyer.

Not only did the ministers for disinvestment and finance oppose Yadav, even the Prime Minister made it clear that Air-India’s sale was at the top of the government’s agenda for the year.

Since then the man at the helm of affairs at New Delhi’s Rajiv Gandhi Bhawan, home to the ministry of civil aviation, had been fuming.

He even called Air-India union leaders to garner their support. But the union which feels its members could get better golden handshake deals if a foreign airline takes over refused to play ball.

However, while interacting with the standing committee, Yadav suddenly found that not only did the Opposition MPs supported him but the ruling party MPs, including hardliners with RSS background—P.K. Aggarwalla, Vikram Verma and Vijay Kumar Khandelwal—were also sympathetic towards his arguments.

Soon Yadav realised that if he continued with his fight he could count on the support not only of the standing committee, which would endorse his views, but also of the large segment of hardline BJP MPs who were already questioning the leadership’s liberalisation model as also the Shiv Sena which too was getting restive over the way the disinvestment was being handled.

The promised support was made public today, with the standing committee ruling in Yadav’s favour, without a single murmur of dissent.

“We are unanimously opposed to disinvestment in Air-India,” said Mohammed Salim of the CPM who is the committee’s chairman.

Today’s development spells trouble for the Vajpayee government which has been pushing hard on its selloff agenda and counting on the sale of the two national carriers—Air-India and Indian Airlines—as possible showpiece achievements.

Jet Air stand

Jet Airways chairman Naresh Goyal today said it was “too premature to comment” on the issue of picking up a stake in Air-India. “It is too early to say anything as we do not know the terms and conditions and till today expression of interest has not been announced by the government,” he said.

Jet has not tied up with British Airways for a joint bid for Air India, he said and added that “we are looking at all options.”    

New Delhi, Aug 22 
Commerce and industry minister Murasoli Maran today said the government was planning a new export strategy which will focus on the sunrise information technology industry.

Chairing a meeting of the reconstituted Board of Trade, Maran said India can increase its share in the world market only through a focus on knowledge-driven industries and services. He added that India accounts for only 0.5 per cent of the global demand, in spite of its leadership in software exports.

The minister announced that a facility would soon be provided on the website of the Directorate General of Foreign Trade (DGFT) whereby exporters could e-mail information about non-tariff barriers being faced by them in overseas markets.

Maran said India’s export performance has witnessed a big turnaround as exports during the first quarter recorded a 28 per cent growth in dollar terms, making it the highest in the entire decade.

He observed that one of the objectives of the plan should be to diversify the export basket as well as their destination, as this would reduce over-dependence on a handful of items which account for over 60 per cent of India’s exports.

Regarding the two major initiatives announced in the exim policy — the Special Economic Zones (SEZ) and the involvement of states in the export effort — Maran expressed satisfaction with the functioning of the schemes.

He said that the DGFT and customs notifications with respect to SEZs have already been issued and a further notification would be issued soon to fulfil the prime objective of the scheme. He said that a number of states were already in the process of finalising their export plans.

The minister also allayed apprehensions regarding a surge in the quantum of exports following the removal of Quantitative Restrictions (QRs) this year. He added that imports in April-June were not so high and that the bulk of the growth was on account of oil imports.    

Calcutta, Aug 22 
B.M. Khaitan has been appointed as the managing director of Bishnauth Tea Company Ltd.

The company will pass a special resolution at its ensuing annual general meeting, appointing B.M. Khaitan for a period of five years.

With the previous incumbent Deepak Khaitan joining Eveready Industries as the chief executive officer, B.M. Khaitan will act as the managing director of the company.

“As B.M. Khaitan has crossed the age of 70, shareholders’ approval is required to be obtained by way of passing a special resolution as prescribed in the Companies Act,” an official of the company said.

Bishnauth Tea has provided a corporate guarantee to the tune of Rs 7.5 crore against a short term loan by UTI Bank to India Foils Limited.

The company has also provided a corporate guarantee to Natex Investment and Marketing Ltd, an associate company, against a rupee loan of Rs 18 crore by HDFC Bank Ltd. It has provided a similar guarantee to Williamson Financial Services Ltd against a loan of Rs 17.5 crore from Infrastructure Leasing and Financial Services. Williamson Financial Services deals in leasing and financial services.

The company will also seek shareholders’ approval at its AGM for the corporate guarantee to these three companies.

However, Bishnauth Tea is worried over tea exports to Egypt due to the COMESA trade agreement. The company had to face tough competition from Kenyan tea, which enjoys a preferential duty in Egypt.

The company is also concerned about the law and order situation in the Assam valley.    

Mumbai, Aug 22 
Alternate bouts of dollar buying and selling courtesy the country’s largest bank, today saw the rupee closing marginally lower at Rs 45.68/69 after hitting an intra-day low of Rs 45.74/75 to a dollar, as against the previous finish of Rs 45.65.

Dealers said that some greenback supplies were witnessed with the Reserve Bank of India (RBI) deadline on the EEFC accounts expiring tomorrow.. However, they were mopped up by the State Bank of India (SBI) on behalf of its clients, which dragged the rupee down to its intra-day low. But the country’s largest bank later emerged as a saviour for the battered currency, turning a dollar supplier.

Forex circles now estimate the rupee to hover in the Rs 45.60-80 range in the immediate term.    

Calcutta, Aug 22 
Alstom Ltd has decided to identify its real estates that are lying idle and may sell them in future.

“The company is open to outright sale of its excess landholdings and other real assets if such assets lie idle or constitute a surplus,” sources said.

As part of the restructuring process initiated in 1998, the firm has reduced employees’ cost by 20 per cent, selling and administrative cost by 11 per cent.

The company, which merged the T&D Distribution Transformers Ltd (DTL), has disbursed Rs 105 crore for the purpose of voluntary retirement scheme in this segment.

Alstom is incurring heavy losses in the motor industry. To tide over the losses, they have offered discounts up to 58 per cent to dispose the products.    

Mumbai, Aug 22 
IDBI Bank is contemplating yet another public issue in consonance with the Reserve Bank of India’s (RBI) regulations stipulating promoters of such banks to reduce their holdings to 40 per cent.

Confirming that the bank is considering the prospects of tapping the capital markets again instead of offloading the stake to a strategic partner, chairman MS Verma said that it was looking at a better market value before coming out with the issue. At present, the combined stake of both promoters—IDBI with 57 per cent and Sidbi with 14 per cent— stands at 71 per cent.

Verma was speaking to newspersons on the occasion of Gunit Chadha taking charge as managing director & CEO of the bank. Chadha joined the bank after a 16-year career with Citibank N.A in corporate and investment banking.

The IDBI Bank chairman pointed out that the bank, which started off as a corporate bank has now shifted focus to ‘retail-oriented banking.’ He added that with service-oriented retail business being significant to a private bank’s growth, technology would be the key driver.

Chadha said in addition to the retail focus, the bank will also focus on the internet and emerge as a leading e-commerce enabler in the country.

Later responding to various queries, Verma said profits of banks are likely to be affected this fiscal on account of changes in the prices of government securities consequent to the recent moves by the RBI. However, he expected IDBI Bank to maintain its previous year’s performance.    


Foreign Exchange

US $1	Rs. 45.69	HK $1	Rs. 5.75*
UK £1	Rs. 67.89	SW Fr 1	Rs. 26.00*
Euro	Rs. 41.11	Sing $1	Rs. 26.25*
Yen 100	Rs. 42.18	Aus $1	Rs. 26.50*
*SBI TC buying rates; others are forex market closing rates


Calcutta	Bombay

Gold Std (10gm)	Rs. 4540	Gold Std (10 gm	4535
Gold 22 carat	Rs. 4285	Gold 22 carat	4195
Silver bar (Kg)	Rs.7850		Silver (Kg)	7970
Silver portion	Rs. 7950	Silver portion	7975

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