Mumbai: Auto maker Tata Motors Ltd, which bought Jaguar and Land Rover from Ford Motor Co., said it is not seeking to purchase Mazda Motor Corp., denying a report by ‘Nikkei English News’. “Tata Motors clarifies that the report is incorrect,” spokesman Debasis Ray said in an email statement.
Sumitomo Corp. and Tata Motors are among the potential buyers for shares in Mazda that Ford is trying to sell, ‘Nikkei English News’ had reported on 11 October, without saying where it had obtained the information.
RBI directs banks to use judgement, allow loans
Mumbai: The Reserve Bank of India, or RBI, on Monday directed banks to use their “commercial judgement” and allow firms to draw working capital loans up to the sanctioned limits.
Facing tight liquidity conditions, some banks were not disbursing working capital loans and term loans, including short-term loans, to their clients against the sanctioned limits, even in cases where the drawing power is available in the client’s account and all the terms and conditions are complied with, an RBI statement said.
The central bank had slashed the cash reserve ratio (CRR) or the money that banks keep with RBI by 150 basis points, releasing Rs60,000 crore into the banking system last week. One basis point is equal to one-hundredth of a percentage point.
— Anita Bhoir
RBI issues guidelines on classifying derivatives
Mumbai: The Reserve Bank of India, or RBI, on Monday issued guidelines on asset classification of derivative transactions of banks with corporations, some of which have turned non-performing assets, following non-payment of dues by firms and being restructured.
RBI said if a firm does not pay for 90 days or more, a derivative contract will be treated as a non-performing asset and all other funded facilities granted to the client will also be classified as non-performing assets.
Many Indian firms had bought structured derivative products from banks to protect themselves from currency fluctuations, but most of them ended up facing huge mark-to-market losses following dollar’s value erosion against some of the major global currencies late last year and early 2008. Mark to market is an accounting practice of valuing a financial asset in accordance with its current market value.
In a related move, RBI permitted banks to take trading positions in interest rate futures, or IRFs. In June 2003, the central bank, had permitted banks to transact in IRFs for hedging the risk in their underlying investment portfolio.
— Anita Bhoir
US’?Sysco sees growth in seafood trade with India
Kochi: US-based Sysco Corp., a $38 billion (Rs1.83 trillion) distributor of food and related products and services, is looking to invest in India for sourcing fish such as tuna and squid in a big way, according to Cameron L. Blakely, vice-president, and James B. Vidrine, director.
Seafood accounts for about 4% of Sysco’s revenues; and 35-40% of its black tiger shrimp comes from India. Last week, the executives visited seafood processing units in Andhra Pradesh, Orissa, Maharashtra and Kerala as part of a fact-finding mission.
“There is great potential for sourcing material from India and it will take a few years to develop the relationship,” Blakely said.
TCS wins contract for faster passport delivery
New Delhi:The country’s largest software services provider Tata Consultancy Services Ltd, or TCS, won a contract worth Rs1,000 crore ($207 million) from the government to speed up the issue of passports to citizens.
The so-called Passport Seva project will be rolled out across the country in six years, Mumbai-based TCS said on Monday.
The pilot project will start functioning in two Indian cities by March, the ministry of external affairs said in a separate statement.
Once the project is implemented, the ministry expects the time taken to issue a passport will be reduced to three days from as many as 45 days now. It expects passports under the so-called Tatkal, or immediate, system to be issued in a day, instead of the current two weeks.
The government will continue to perform functions, including the granting and printing of passports, apart from monitoring their issue, the ministry said. TCS will charge a fee for providing the computer systems, infrastructure and employees at passport outlets among other services, the ministry said.
Foreign secretary Shivshankar Menon and Tata Consultancy chief executive S. Ramadorai signed the passport project contract in New Delhi on Monday.
CRR cut won’t help developers: Macquarie
Mumbai: The country’s real estate developers will continue to face a shortage of funds even after the central bank cut the amount of cash banks need to hold to ease credit, Macquarie Research said in a note to clients.
Analysts Unmesh Sharma and Bharat Rathi said in the note from Mumbai on Monday, “We believe the tightness will continue for a few more months, given the difficulty in raising capital through bank debt, equity markets and (more recently) private equity.”
The country made the steepest cut since 2001 in the amount of cash lenders must set aside as reserves to ease credit on 10 October. DLF Ltd, country’s largest developer, is the second worst performer on the benchmark index over the past year as investors shunned real estate stocks on concern borrowing costs at a seven-year high and the global credit crunch would hurt profits.
Commodity trading turnover up on gold, oil
Mumbai: The Multi Commodity Exchange of India Ltd (MCX), the world’s third largest gold bourse, and other local exchanges had a 47% increase in turnover in the six months to September as trading in bullion and crude oil increased.
Commodities worth Rs25.9 trillion were traded between April and September, compared with Rs17.6 trillion a year earlier, the Forward Markets Commission, which regulates the exchanges, said in a release on its website on Monday.
Trading in gold and silver more than doubled to Rs13.7 trillion, while trading in agriculture commodities fell 32% to Rs3.19 trillion after the government in May banned futures trading in soya bean oil, natural rubber, potatoes and chickpeas.
Ceiling prices of three diabetics drugs revised
New Delhi: Drug price regulation National Pharmaceutical Pricing Authority has revised the ceiling prices of three more formulation packs, a senior official said on condition of anonymity as he is not authorized to speak to the media.
The formulations are essentially generic diabetic tablets.
While the price of the 2.5mg glipizide tablet has been reduced by 2.58% to Rs3.02, the price of the 5mg tablet has come down by 11.33% to Rs5.32.
Originally manufactured and marketed as Glucotrol by Pfizer Inc., the formulations are available in India under the generic brand named Glicolip by Wallace Pharma, Glynase by USV Pharma and Glyzip by Stadmed.
The price of combination glipizide and metformin hydrochloride tablet has been increased by 1.3% to Rs9.38.
— Radhieka Pandeya
Dasmunsi on life support system
Bangalore: Information and broadcasting minister Priya Ranjan Dasmunsi has been put on a life- support system after a heart attack.
Dasmunsi, 62, was admitted to the All India Institute of Medical Sciences in New Delhi on Sunday, hospital spokesman Y.K. Gupta said in a phone interview. “The minister is in a serious condition,” he said.
Reliance Brands in joint venture with Diesel
Mumbai: Reliance Brands Ltd, a unit of Reliance Industries Ltd, on Monday said it has entered into a joint venture with Italy’s Diesel International Pvt. Ltd to sell its denim and lifestyle brand in India. Diesel will hold 51% stake in the venture, Darshan Mehta, president and chief executive of Reliance Brands said after announcing the tie-up.
Diesel India Fashion Reliance Pvt. Ltd, the joint venture, will launch its stores in March or April in Mumbai and Delhi, and has plans to enter markets such as Bangalore, Hyderabad and Chandigarh, Mehta said.
This is Diesel’s second attempt to enter India. The company had announced a joint venture with Arvind Ltd, formerly Arvind Mills Ltd, in April 2007, when Darshan Mehta was heading VF Arvind Brands Pvt. Ltd. Diesel and Arvind called off the deal later saying the joint venture would restrict their expansion plans in India.
“I was a part of Arvind when the joint venture was announced but after I quit, I don’t know what went wrong between the two companies that the joint venture was called off,” Mehta said.
— Jharna Mazumdar
Panel to look into 2G and 3G revenue split
New Delhi: Even as telecom minister A. Raja said that the government had referred the issue of splitting of revenues between 2G and 3G services split, the GSM-lobby, Cellular Operators Association of India, or COAI, said such segregation was possible. A 2G, or second generation, is a mobile technology used for basic cellular phone services and 3G, or third generation, mobile services enables high speed data, voice and video transfer on mobile phones. “There were several ways in which the 2G and 3G revenues could be segregated and that the industry had recommended two simple ways that could be adopted by the Government, viz., the traffic based approach and the call data record based approach,” said T.V. Ramachandran, director general, COAI.
— Staff Writer/PTI