Bangalore: India has removed licences for its local industry to manufacture defence equipment and allow foreign arms makers bidding for deals with the country’s military to bank offsets at least two years before they conclude contracts. The private industry can produce defence equipment with industrial licences, except in specific cases, according to the defence procurement procedure, 2008, released on Friday. India mandates arms makers to source at least 30% of the value of the arms sold to the country’s military from local vendors. “This will also enable foreign industry and their Indian offset partner to have long-term arrangements to discharge offsets and will thus enhance the capacity of the Indian industry to absorb offsets,” says a Defence ministry statement. If a vendor is able to create more offsets than his obligations under a particular contract, the surplus offset credits can be banked and would remain valid for the period of two fiscals after conclusion of the said contract, it said.
Interest rates to come down in 6-12 months
Bangalore:Finance minister P. Chidambaram said on Friday that interest rates should come down from the current levels in 6-12 months and urged the banks to mobilize low cost deposits to hold up their margins. Assuring that there was enough money in the system, Chidambaram said banks should keep the lending rates low and ease the burden of high interest rate by mobilizing low cost deposits. “I would advice all public-sector banks to aim to make Casa (current account savings account) at least 40% of the total deposits,” he said. Calling the current year a “difficult” one due to rising crude oil and commodity prices, the finance minister said moderate and normal interest rates would be back within a year. “These interest rates will not remain high forever and forever. We will get out of this trough,” he said. He, however, did not indicate what “normal” meant. On Tuesday, the Reserve Bank of India (RBI) had raised the cash reserve ration (CRR) for banks by 0.25% and the short-term lending rates by 0.50%, after which banks such as HDFC Bank Ltd, Axis Bank Ltd, ICICI Bank Ltd and Punjab National Bank Ltd declared a rise in their interest rates. Deepti Chaudhary
Pramod Kumar Rastogi is new steel secretary
New Delhi:Pramod Kumar Rastogi on Friday took over as Union steel secretary., replacing R.S. Pandey who has moved to the ministry of petroleum and natural gas as secretary. Rastogi, a 1974 batch Indian Administrative Service officer, was earlier special secretary in the defence ministry. PTI
RS Pandey takes over as petroleum secretary
New Delhi: R.S. Pandey took over as the new petroleum secretary on Friday , setting for himself the task of balancing the interests of consumers, the government and oil companies in the wake of high crude oil prices.
Pandey, who was earlier the steel secretary, replaced M.S. Srinivasan who retired on Thursday. “High oil prices have thrown us the challenge of maintaining the health of our Navratna oil companies while at the same time safeguarding government’s revenues and overall economic interest as well as providing consumers with affordable fuel,” he said. PTI
Renault denies talks with Bajaj for stake sale
New Delhi: French auto maker, Renault SA, that’s building a car factory in India with Nissan Motor Co., said it hasn’t held talks with Bajaj Auto Ltd to sell a stake in the plant, denying a newspaper report. ‘The Economic Times’ reported on Thursday Renault has offered Bajaj Auto, India’s second biggest motorcycle maker by sales, a stake in the car plant. The two firms are also discussing a partnership to sell Renault vehicles to be made in the Chennai factory, the newspaper said.
“We wish to state very emphatically that there have been no talks with Bajaj Auto to partner us in the Chennai project,” Renault said in a release issued late on Thursday.
Nissan, Japan’s third largest auto maker, and affiliate Renault, began building the $1.1 billion (Rs4,664 crore) factory in Chennai last month. The plant will begin production in 2010 and will have a capacity to make 400,000 cars annually, the company said. Bloomberg
Ban on grain exports to be reviewed next week
New Delhi: India will review a ban on exports of grains next week, said commerce and industry minister Kamal Nath. The country is the world’s second biggest producer of wheat and rice.
The government had banned rice shipments in April and wheat sales in 2006 in order to boost domestic supplies and cool food prices. Export of edible oils, too, was halted and tax cut on vegetable oil imports in March. The ban will be lifted if food stocks are found to be adequate, Nath said on Friday.
India’s wheat production is estimated to have had reached 78 million tonnes (mt) in the year to June, an increase of 1.2mt since February. Rice output may total 95.7mt, the agriculture ministry had said on 22 April. Bloomberg
Malaysian co may sell bonds for India plans
Kuala Lumpur: Malaysia’s second biggest mobile phone carrier, TM International Bhd, may sell bonds that can be converted into shares to help fund expansion in India.
The firm will decide on the funding plan in the next three to six months, chief executive officer Jamaludin Ibrahim said in Kuala Lumpur on Friday after shareholders approved a plan to combine Spice Communications Ltd, its Indian unit, with Idea Cellular Ltd.
Jamaludin also said the company may not exercise an option to issue new shares representing as much as 10% of the company in order to avoid diluting earnings. Bloomberg
Tata Steel puts overseas assets in holding firm
Mumbai: India’s largest private steel maker, Tata Steel Ltd, has moved its overseas assets, including its Corus unit, to a fully owned holding company that will be its vehicle for global expansion, its chief financial officer said on Friday.
Tata Steel will use the Singapore-based Tata Steel Global Resources Ltd to raise funds for international acquisitions of smaller steel makers and mines, Koushik Chatterjee said at a news conference.
“It is no secret we are looking for raw material assets. Because of the size and geographical spread of the holding company, it would be easy to raise funding,” he said. Tata Steel Global’s assets include steel units in South-East Asia and stakes in mines in Ivory Coast, Mozambique and Oman. Chatterjee said the holding company has an enterprise book value of more than $13 billion (Rs55,120 crore). Shares in Tata Steel gained 3.92% to close at Rs680.65 on the Bombay Stock Exchange. Reuters
WB lends $521 mn to fight polio, malaria
Tokyo: India has secured almost $521 million, or Rs2,209 crore, of funding from the World Bank to fight infectious diseases, including polio and malaria, which kill thousands of people in the country and risk spreading overseas.
The funding will help the government and United Nations agencies prevent, diagnose and treat parasitic infections and increase polio vaccination, the Washington-based bank said in a release on Thursday.
India is one of four nations which have never interrupted the transmission of polio, frustrating global attempts to eradicate the disease. Bloomberg
RCom registers biggest drop in two years
Bangalore:Reliance Communications Ltd, India’s second-largest mobile-phone operator, fell the most in two years in Mumbai on concerns that earnings growth will sputter after reporting the slowest profit increase in nine quarters.
Reliance declined 13% to Rs436, the biggest drop since June 8, 2006. The stock was the worst performer on the benchmark Sensitive Index, which gained 2.1%. Reliance is Asia’s worst-performing telecommunications stock this year as it signed up customers at a slower pace than top-ranked Bharti Airtel Ltd and Vodafone Group Plc’s India unit. Reliance reported on Thursday first-quarter net income rose 24%, lagging the 34% increase by top-ranked Bharti. Bloomberg
ArcelorMittal may bid for Alpha Natural: FT
London/Melbourne: The world’s largest steel maker, ArcelorMittal, is considering making an offer for Alpha Natural Resources Inc. to trump Cleveland-Cliffs Inc.’s $8.8 billion (Rs37,312 crore) bid, the ‘Financial Times’ reported.
ArcelorMittal may also wait for the Cleveland-Cliffs offer to either fail or create a single takeover target, the newspaper said, citing unidentified people close to the companies. Calls to ArcelorMittal’s London-based spokesman Haroon Hassan and Alpha Natural’s head office in Abingdon, Virginia outside normal business hours weren’t immediately returned.
Acquiring Alpha Natural, the largest exporter of coking coal from the US, would help ArcelorMittal secure additional supplies of steel making raw materials as record prices for coal and iron ore boost costs.
ArcelorMittal had signalled it was prepared to make an all-cash offer for Alpha in June, which prompted Alpha to seek other, higher bids, the “Financial Times” reported. Bloomberg
Moser Baer India posts Rs104 cr loss in Q1
Bangalore: The nation’s largest maker of computer compact discs, Moser Baer India Ltd, reported a first-quarter loss of Rs104 crore from a profit in the year earlier period.
Sales fell 0.6% to Rs497 crore in the three months ended June, the New Delhi-based company said in a statement to the Bombay Stock Exchange (BSE). Net income in the year earlier period was Rs9.64 crore. Shares of Moser Baer lost 2.84% to close at Rs90.55 on BSE. Bloomberg