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Oprah’s exit opens wide range of possibilities

Brian Stelter / NYT — Mon, 23 Nov 2009 18:47:00 GMT

There is no single replacement for Oprah Winfrey.

That’s not necessarily a statement about the dominance of her 24-year-old television institution, The Oprah Winfrey Show. Rather, it is the reality of television syndication.

When Winfrey leaves the broadcast airwaves in two years, a stable of talk shows will vie to fill her former time slot on more than 200 stations across the US. Individual stations are bound to place differing bets, drastically reshaping the daytime TV landscape.

As with NBC and Jay Leno earlier this year, the television chess board is being rearranged by a talk show host.

Even before Winfrey announced last Friday that 2011 would be the right time to step off her broadcast stage, TV executives were jostling on behalf of Ellen DeGeneres, Dr Mehmet Oz, Dr Phil McGraw and other hosts who aim to benefit from the syndication shake-up.

Hedge funds bet on my $76,000 with greed

Debt Economics | William Pesek / Bloomberg — Mon, 23 Nov 2009 18:46:00 GMT

During a recent chat about global markets, a hedge-fund manager was obsessing about my $76,000 (Rs35.3 lakh).

That’s roughly what Japan owes for each of its 126 million inhabitants. This amount has some hedge-fund investors piling on the Japan trades.

The bad news for Asia’s biggest economy is that many such bets are against it. The focus is on the risk of a yen plunge because of a different $76,000 figure: the cost of insuring trades on Japan’s massive debt.

Does all this mean the great yen crash analysts have predicted for years is imminent? Hardly.

The cost of hedging against losses on $10 million of Japanese bonds with credit default swaps soared this month to at least $76,160 a year from $37,000 in August. The increase corresponds with the policies of a new government considering record spending and borrowing amid falling tax revenue.

The jump in debt-protection costs has a certain logic as Japan’s debt heads toward 200% of gross domestic product (GDP). That’s by far the largest in the industrialized world.

Many traders say Japan is more likely to renege on debt than the US is. Last month, former International Monetary Fund chief economist Simon Johnson told the US Congress that debt is out of control and said there is a real risk that Japan could end up in a major default.

Even so, a near-term yen crash is a reach. Reports in the local media that finance minister Hirohisa Fujii’s tolerance for a stronger currency may be running out are fuelling speculation that Japan will intervene in markets. Here, though, it’s worth asking why Japan hasn’t already done that.

Japan spent the equivalent of the annual GDP of Greece in the 15 months through March 2004 to cap the yen. It was like mobsters whacking a rival now and again. For years after that, it didn’t intervene to weaken the currency. Finance ministry officials only had to hint they were unhappy with the yen’s level, and markets would fall back in line.

When the US subprime mess snowballed into a global meltdown, everything changed. As the dollar fell, the yen had nowhere to go but up. And up it went. The yen has risen around 25% against the dollar since January 2008, and Japan had to accept it. It’s all about the dollar, not the yen.

What can Japan do about it? A key reason members of the G-7 and G-20 aren’t coming to Japan’s rescue is agreement that the dollar needs to weaken. It’s about facilitating a badly needed rebalancing of global growth.

The reserve currency is printed by a US government that depends on imported capital to finance its excesses. The world relies on the excesses of the US consumer. That unhealthy codependence must end and a weaker dollar is crucial.

Monitoring the global economy these days is like trying to work out an M.C. Escher drawing. Little makes sense in a world where the US is nationalizing key industries, China’s economy is a role model and gold costs at least $1,100 an ounce.

The yen is among those absurdities. The combination of near-zero interest rates, unprecedented debt levels, a sinking savings rate and deflation should be devastating for any currency. And while a government default is extremely unlikely, credit downgrades can’t be ruled out. The spectre of lower ratings should be negative for the yen.

Japan’s aging population and stagnant birthrate has traders questioning whether it can repay that $76,000 per person worth of debt. That figure will only grow in the years ahead as the workforce shrinks.

The surreal nature of government policies only adds to the disorientation. China’s undervalued currency, which is exacerbating global imbalances, comes to mind. Debt managers in the US seem to be competing with their Japanese peers to test the tolerance of credit rating firms in 2010.

This is where we are, though. Were the US growing soundly and getting its fiscal act together, a weaker yen would be a safe bet. Japan could intervene in markets, yet it might fail. It would embolden speculators to drive the yen higher. That possibility explains why Japan has been holding its fire.

Japan certainly could use some help fighting deflation. The domestic demand deflator, a measure of price levels that excludes the cost of imports, fell 2.6% in the third quarter from a year earlier. It was the biggest drop since 1958 and eclipsed a 4.8% jump in growth.

You can bet Prime Minister Yukio Hatoyama and Fujii are wondering how to weaken the yen. Hedge-fund managers, too. It will be easier said than done in today’s world.

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Shared supercomputing and everyday research

Ashlee Vance / NYT — Mon, 23 Nov 2009 18:46:00 GMT

Portland, Oregon: For decades, the world’s supercomputers have been the tightly guarded property of universities and governments. But what would happen if regular folks could get their hands on one?

The price of supercomputers is dropping quickly, in part because they are often built with the same off-the-shelf parts found in PCs, as a supercomputing conference here last week made clear. Just about any organization with a few million dollars can now buy or assemble a top-flight machine.

Affordable technology: The Jaguar supercomputer at the Oak Ridge National Laboratory in Tennessee, the world’s fastest, links thousands of mainstream chips from AMD. AP

Meanwhile, research groups and companies such as International Business Machines Corp., Hewlett Packard Development Co. Lp, Microsoft Corp. and Intel Corp. are finding ways to make vast stores of information available online through so-called cloud computing.

These advances are pulling down the high walls around computing-intensive research. A result could be a democratization that gives ordinary people with a novel idea a chance to explore their curiosity with heavy computing firepower— and maybe find something unexpected. The trend has spurred some of the world’s top computing experts and scientists to work towards freeing valuable stores of information. The goal is to fill big computers with scientific data and then let anyone in the world with a personal computer, including amateur scientists, tap into these systems.

“It’s a good call to arms,” said Mark Barrenechea, the chief executive of Silicon Graphics, which sells computing systems to labs and businesses. “The technology is there. The need is there. This could exponentially increase the amount of science done across the globe.”

The notion of top research centres sharing information is hardly new. Some of the earliest incarnations of what we now know as the World Wide Web came to life so that physicists and other scientists could tap into large data stores from afar. In addition, universities and government labs were early advocates of what became popularized as grid computing, where shared networks were created to shuttle data about.

The current thinking, however, is that the labs can accomplish far more than was previously practical by piggybacking on some of the trends sweeping the technology industry. And, this time around, research bodies big and small, along with brainy individuals, can participate in the sharing agenda.

For inspiration, scientists are looking at cloud computing services such as Google’s online office software, photo-sharing sites and Amazon.com’s data centre rental programme. They are trying to bring that type of Web-based technology into their labs and make it handle enormous volumes of data.

“You’ve seen these desktop applications move into the cloud,” said Pete Beckman, the director of the Argonne Leadership Computing Facility in Illinois. “Now science is on that same track. This helps democratize science and good ideas.”

With $32 million from the energy department, Argonne has set to work on Magellan, a project to explore the creation of a cloud-computing infrastructure that scientists around the globe can use.

Beckman argued that such a system would reduce the need for smaller universities and labs to spend money on their own computing infrastructure.

Another benefit is that researchers would not need to spend days downloading huge data sets so that they could perform analysis on their own computers. Instead, they could send requests to Magellan and just receive the answers.

Even curious individuals on the fringe of academia may have a chance to delve into things like climate change and protein analysis.

“Some mathematician in Russia can say, ‘I have an idea’,” Beckman said. “The barrier to entry is so low for him to try out that idea. So, this really broadens the number of discoverers and, hopefully, discoveries.”

The computing industry has made such a discussion possible. Historically, the world’s top supercomputers relied on expensive, proprietary components. Government laboratories paid vast sums of money to use these systems for classified projects. But over the last 10 years, the vital innards of supercomputers have become more mainstream, and a wide variety of organizations have bought them.

At the conference, undergraduate students competed in a contest to build affordable mini-supercomputers on the fly. And a supercomputer called Jaguar at the Oak Ridge National Laboratory in Tennessee officially became the world’s fastest machine. It links thousands of mainstream chips from Advanced Micro Devices (AMD).

Seven of the world’s top 10 supercomputers use standard chips from AMD and Intel, as do about 90% of the 500 fastest machines. “I think this says that supercomputing technology is affordable,” said Margaret Lewis, an AMD director. “We are kind of getting away from this ivory tower.” While Magellan and similar projects are encouraging signs, researchers have warned that much work lies ahead to free what they consider valuable information for broader analysis. At the Georgia Institute of Technology, for example, researchers have developed software that can evaluate scans of the brain and heart, and identify anomalies that might indicate problems. To advance such techniques, the researchers need to train their software by testing it on thousands of body scans. But it is hard to find a repository of such scans that a hospital or a government organization such as the National Institutes of Health is willing to share, even if personal information can be stripped away, said George Biros, a professor at the Georgia Institute of Technology. “Medical schools don’t make this information available,” he said.

Bill Howe, a senior scientist at the eScience Institute at the University of Washington, has urged research organizations to reveal their information. “All the data that we collect in science should be accessible, and that’s just not the way it works today,” he said.

Howe said high school students and so-called citizen scientists could make new discoveries if given the chance.

“Let’s see what happens when classrooms of students explore this information,” he said.

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MFIs wary of housing loans over default fears

Deepti Chaudhary — Mon, 23 Nov 2009 18:44:00 GMT

Bangalore: Concerns of defaults are holding back microfinance institutions, or MFIs, from a full-fledged expansion into home loans even as they seek to turn their clientele of poor borrowers into consumers and compete with commercial banks.

MFIs, established mainly to lend small sums to the unbanked poor to help them earn a living, say there’s potentially a huge demand for home loans among their customers. At least two of seven prominent MFIs that Mint spoke to have started experimental lending for home purchases to test the waters while the rest are hesitant.

Risky venture: A file photo of area managers conducting a weekly meeting at a village near Mysore. MFIs fear defaults may be higher in the case of home loans because the borrowers would be individuals and not groups. Hemant Mishra / Mint

“This is unsecured lending. Risks are too many,” said a senior official at SKS Microfinance Ltd, India’s largest MFI, who didn’t want to be named. “It’s a different and a difficult ball game. We do not know yet how to price it.”

If defaults pile up, it could be the equivalent of the US banks’ subprime crisis for micro lenders, he said.

The official added: “We need to be very careful as defaults would be high. We do have a demand. Still, we need to work out how to go about it. We are still working out the legalities ...and have involved sector experts.”

SKS will launch a pilot programme of home lending, but not in the next two-three months.

Home loans would be an extension of the consumer finance business of MFIs, who have already gone beyond their traditional role by financing the purchase of mobile phones, water purifiers and even refrigerators and are seeking to expand their product offerings to compete with commercial lenders.

MFIs have built their success mainly on small joint liability loans that could range between Rs10,000 and Rs20,000 given to community groups to earn a livelihood. Such borrowers lack collateral and the credit history that banks require.

Home loans would be of a far bigger size—up to Rs3 lakh—and wouldn’t qualify as livelihood loans that are income generating and aid loan repayments. The risk of defaults is higher also because the borrowers would be individuals and not groups.

Madura Micro Finance Ltd and Bhartiya Samruddhi Finance Ltd have launched pilot programmes by giving home loans to around 100 customers each to gauge the viability of the business.

“We are still in the process of judging the feasibility of this offering,” said M. Narayanan, chief executive of Madura Micro Finance, which is doing pilots in Madurai and Salem districts of Tamil Nadu. “It’s not just about defaults. We have to doubly ensure that all documents are in place and insist on proper credentials. We also need a guarantor,”

The firm offers loans of Rs50,000 for home renovation and repair and Rs1 lakh for buying or constructing a house. To attract customers, Madura Finance is offering these loans at lower rates than group loans. While its lending rates for self-help groups are in the range of 18-21%, it is offering housing loans at 18%.

Bhartiya Samruddhi, part of the Basix Group, is offering home loans that have a duration of five-seven years, and the firm insists on collateral. “The need (for home loans) is huge. However, in this business defaults could be as much as 2%,” said S. Ramachandran, chief financial officer.

MFIs attribute their huge success to default rates as low as 0.01%.

Some MFIs are considering partnerships for entering this segment. Bangalore-based Ujjivan Financial Services Pvt. Ltd is in talks with a national housing company for a tie-up. Once the tie-up is in place, the firm will give home loans on an experimental basis. For Ujjivan, which is already offering loans for leases, rents and home improvement, home loans would be a natural progression.

“There are a few companies set up for offering micro housing loans and they want to work with us for extending such loans to our customers. We are looking at this, it’s all in early stages of it,” said Samit Ghosh, chief executive officer.

In their bid to lower risks, MFIs are looking at adopting technologies that would help in eliminating cash from the system.

Bangalore-based mChek India Payment Systems Pvt. Ltd and Grameen Koota microfinance institution are running a pilot to implement mobile payments in the micro-credit sector, which will help reduce disbursement and collection costs significantly.

Experts say MFIs are being prudent by adopting caution in entering the home loan business, given their lack of experience in the segment.

“MFIs can look at managing and sourcing portfolio for other lenders like housing financial companies, non-banking financial companies and banks. MFIs can source loans for customers and help service these to gain experience in this kind of business,” said Viren H. Mehta, national director at consultancy firm Ernst and Young India.

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World stock markets rise sharply as gold touches record high

Pan Pylas / AP — Mon, 23 Nov 2009 18:45:00 GMT

London: World markets rose sharply Monday amid further hopeful signs about the economic recovery. Commodity stocks led the charge, particularly in London, after gold hit record high amid renewed dollar weakness.

European stocks tracked their Asian counterparts higher, with the FTSE 100 index of leading British shares up 88.99 points, or 1.7%, at 5,340.40. Germany’s DAX rose 91.74, or 1.6%, at 5,754.89 and the CAC-40 was 57.24, or 1.5%, higher at 3,786.60.

Extra shine: The falling dollar has made gold more attractive to foreign investors; as a result, commodity stocks are heavily in demand. Toru Hanai / Reuters

Wall Street was poised to open higher after a strong end to last week. Dow futures were up 91 points, or 0.9%, at 10,394 while the broader Standard and Poor’s 500 futures rose 11.50, or 1.1%, to 1,101.60.

Sentiment in Europe was buoyed by data indicating that the economic recovery is gathering pace in the 16 countries that use the euro.

The monthly composite purchasing managers index—a broad gauge of business activity in the manufacturing and services sector—rose to 53.7 in November from October’s 53.

Any reading above 50 indicates expansion and the bigger the difference from 50 the greater the expansion. The figures confirmed that the recession in the eurozone ended in the third quarter, though growth was a muted 0.3%.

“November’s rise suggests that the eurozone economy has gained a bit more momentum in Q4, but the recovery remains of the steady, rather than the spectacular, variety,” said Ben May, European economist at Capital Economics.

Much of Monday’s activity centred on commodity stocks as the price of gold rose 1.7% to a new record of $1,167.35 (Rs54,281.76) an ounce (1oz is 28.35g). Gold has garnered renewed support as the recent rally in the dollar ran out of steam after US Federal Reserve official James Bullard said the central bank should continue to buy mortgage-backed securities after the March expiration date.

Any suggestion that the Fed will maintain its extraordinary monetary policy measures for longer than previously anticipated heaps pressure on the dollar—by late morning London time, the euro was up 0.8% at $1.4971.

The falling dollar makes gold more attractive to international investors and as a result, commodity stocks were heavily in demand, particularly on London’s FTSE 100, where a number of resource companies are listed—near the top of the leaderboard were Eurasian Natural Plc, Xstrata Plc and Rio Tinto Plc.

Attention later will focus on US existing home sales figures for October.

Analysts are hopeful the figures will not disappoint after a mixed series of housing data recently, and are forecast to have risen around 2.5% to an annual rate of 5.7 million units.

Kelly Olsen in Seoul, South Korea contributed to this story.

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Rupee gains the most in Asia as expansion seen spurring inflows

Anoop Agrawal / Bloomberg — Mon, 23 Nov 2009 18:45:00 GMT

Mumbai: The rupee gained the most in more than a week on speculation economic growth prospects in the region will encourage overseas investors to increase holdings of the nation’s stocks.

Ownership of Indian equities by funds based abroad climbed to a record $15.3 billion (Rs71,145 crore) as of 20 November, data from the Securities and Exchange Board of India (Sebi) showed.

The benchmark Bombay Stock Exchange’s sensitive index rose to the highest in a month on Monday.

The dollar fell against most major currencies, while the price of gold rose to an all-time high.

The tide is swaying away from the dollar because of fundamental reasons and that is helping the rupee, said Jai Prakash Israni, a currency trader in Mumbai at state-owned Andhra Bank. There is no reason why the rupee will not rally in the near term.

The rupee gained 0.4% to 46.48 per dollar in Mumbai, according to data compiled by Bloomberg.

The rupee may advance to 46.25 this week, Israni said. The local currency has strengthened 3.6% this quarter, the best performance in Asia. Economic reports this week may show rising export orders in Taiwan and faster growth in the Philippines, according to Bloomberg surveys of economists.

Gold has advanced 34% this year as the Dollar Index, a gauge of the currency’s value against six major trading partners, fell 7.4%. The most accurate forecasters predict the greenback will extend its drop as the world’s lowest borrowing costs, rising unemployment and a record $4 trillion of government bond sales between 2009 and 2010 weigh on the dollar.

Offshore contracts indicate bets the rupee will trade at 46.49 to the dollar in a month, compared with expectations of 46.66 at the end of last week. Forwards are agreements in which assets are bought and sold at current prices for future delivery. Non-deliverable contracts are settled in dollars rather than the local currency.

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JSW Energy IPO to open 7 December, targets Rs2,700 crore

N. Sundaresha Subramanian — Mon, 23 Nov 2009 18:44:00 GMT

Mumbai: JSW Energy Ltd, the power generation unit of the JSW group, plans to raise Rs2,700 crore through an initial public offer that will be open 7 December through 9 December, said Sajjan Jindal, vice chairman, JSW Steel Ltd, in Mumbai on Monday.

He did not disclose the extent of equity dilution, saying it would be clear once the price band for the offer is announced on 3 December.

The issue has been graded by rating agency CARE Ltd as Grade 4, indicating above-average fundamentals. JM Financial Consultants Pvt Ltd, Kotak Mahindra Capital Ltd., ICICI Securities Ltd., IDFC-SSKI Ltd., JP Morgan India Ltd., SBI Capital Markets Ltd., Morgan Stanley India Ltd. and IDBI Capital market Services ltd are the book running lead managers to the issue.

Experian forms JV with 7 FIs to form credit information firm

PTI — Mon, 23 Nov 2009 18:43:00 GMT

Mumbai: Experian Plc, a UK-based global information services company, has created a joint venture (JV) with seven of India’s leading financial services institutions to form a credit information company named Experian Credit Information Company of India Private Limited, a top company official said on Monday.

“We have formed a joint venture with seven financial institutions - Axis Bank, Federal Bank, Indian Bank, Punjab National Bank, Union Bank of India, Sundaram Finance and Magma Fincorp - to form a credit information company,” Experian Credit Information Company’s chairman and former Bank of India chairman and managing director T.S. Narayanasami, told PTI.

Experian will own 49% of the joint venture, while the seven financial institutions will jointly hold 51%. Axis Bank will hold 10%, Union Bank of India 10%, PNB 7%, and Indian Bank and Federal Bank 5% each, while Sundaram Finance and Magma Fincorp will hold 7%each, Narayanasami said.

The Reserve Bank of India (RBI) in April granted Experian a provisional licence to operate a credit information company. The company will now apply for a final licence.

I-T dept sets up dispute resolution panel

Sanjiv Shankaran — Mon, 23 Nov 2009 18:36:00 GMT

New Delhi: The income-tax department has notified the creation of a dispute resolution panel, which aims to shorten the time taken to resolve disputes between the department and tax payers on the extent of the latter’s tax liability.

The panel was set up in the wake of a promise in Union finance minister Pranab Mukherjee’s July 2009 Budget to quicken the pace of resolving tax disputes as foreign investment is extremely sensitive to prolonged uncertainty in tax matters.

The notification was issued on 20 November.

“It is very critical because we have a huge amount of litigation,” Vijay Iyer, partner at consultancy Ernst and Young, said. The panel would have a window of up to nine months, from the day a tax assessment is completed and the draft given to the assessee, to issue directions. “Now it will depend on how well it is implemented,” Iyer said.

Maruti may produce 1 mn cars this year: Rao

Bloomberg and PTI — Mon, 23 Nov 2009 18:30:00 GMT

New Delhi: Maruti Suzuki India Ltd is expected to produce one million vehicles by the end of the current fiscal year, I.V. Rao, managing executive officer of engineering told reporters in New Delhi on Monday.

The country’s largest car maker also said it will launch a new van within this fiscal to replace its multi-purpose vehicle Versa, the production of which has been stopped.

Quick Edit | Two rights make a Google

Mon, 23 Nov 2009 18:29:00 GMT

One visible advantage of the Internet is that people can create their own versions of certain websites— portals, say (although the term is archaic), or news sites. So, it shouldn’t surprise anyone that Google Inc., in an effort to please neighbours China and India—and who can afford to antagonize these two powerful countries and economies?—has created different versions of Google Maps for the two countries, featuring geographical boundaries that New Delhi and Beijing are comfortable with.

At one level, Google’s virtual reality may be the best way to deal with such issues where neither party is likely to back down from a previously articulated position. The Internet makes alternative realities possible.

Google’s move also gives the term “doing business across borders” an entirely new meaning. But it is, for a company that once proudly proclaimed that it does no evil, an interesting display of realpolitik.

India stays happy. China stays happy. And Google makes the money.

Edelweiss inks JV with Tokio Marine

PTI — Mon, 23 Nov 2009 18:26:00 GMT

Mumbai: Financial services firm Edelweiss Capital Ltd on Monday signed a joint venture (JV) agreement with Japanese insurer Tokio Marine Holdings, Inc., (TMH) to enter the life insurance sector.

The JV, Edelweiss Tokio Life Insurance (ETLI), will apply to the Insurance Regulatory & Development Authority (Irda) for approval to start operations, which may take between eight months and one year to start, Edelweiss Capital’s chairman Rashesh Shah said.

“Edelweiss will have 74% stake in the JV and the remaining with Tokio Marine Holdings,” he said, adding that the JV will start with Rs550 crore paid-up equity capital.

The Japanese major might increase its stake in the JV to 49% as soon as IRDA hikes the foreign direct investment limit in the life insurance sector, Shah said.

He added that ETLI, the new JV, would appoint 40-50 people in the project team initially and add to it when it gets Irda approval.

TMH managing director Hiroshi Endo said the company had been waiting for a right partner to enter the life insurance space and that Edelweiss met all its partnership criteria such as strong financial capital base and strong brand equity.

TMH has a net worth of $18.4 billion and had revenues of $39 billion in 2009. It is also present in general insurance and asset management sectors, and offers other financial services. TMH had earlier entered the Indian general insurance space in 2000 through a partnership with Indian Farmers Fertiliser Cooperative Ltd (IFFCO).

Infosys BPO’s CEO Amitabh Chaudhry quits

Lison Joseph — Mon, 23 Nov 2009 18:18:00 GMT

Mumbai: Amitabh Chaudhry, chief executive of Infosys BPO Ltd, the business process outsourcing arm of India’s second largest software services exporter Infosys Technologies Ltd, resigned on Monday.

Chaudhry had taken over as chief executive in March 2006. Details about the reason for his resignation, or his successor were not immediately available. A company spokesperson confirmed the development but said there was no official communication on the matter. Earlier this month, Infosys BPO had announced its intention to acquire US-based insurance business process outsourcing firm McCamish Systems Llc for up to $58million.

The Mint report for 23 November 2009

Mon, 23 Nov 2009 18:13:00 GMT

New Delhi: India’s stock market regulator Sebi has issued a show-cause notice to RIL on several alleged violations. The show-cause notice asks RIL why it should not be prohibited from buying and selling listed securities, not be prohibited from accessing capital markets or not be made to pay up profits that it claims RIL made through insider trading. RIL has denied the allegations and says it has submitted a detailed reply to Sebi, which had not replied. A show cause notice is not an indictment and only requires RIL to provide a reply.

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Reliance Capital says three foreign insurance firms have approached it about buying a stake in its life insurance business. The move comes at a time when Reliance Capital plans to float an IPO for up to 26 % of its life insurance unit called Reliance Life. Prior to the IPO, the company plans sell another 10% of Reliance Life to a strategic investor including foreign insurance companies.

A senior Merrill Lynch executive has said India should not be complacent about undertaking major financial reforms. Kevan Watts, who’s head of the Indian operations of Bank of America and Merrill Lynch says the danger is India will not be enthusiastic about reforms after having avoided last year’s global financial meltdown. For many years, India has been talking about financial sector reforms including giving equal voting rights to foreigners in private-sector banks and allowing foreign companies to participate in the pension sector.

There was uproar in Parliament on Monday over a leaked report that blamed the opposition BJP with playing a role in the Babri Masjid demolition in 1992. Politicians were reacting to a report in The Indian Express newspaper that published excerpts Liberhan report on the demolition. The report mentions current leader of the opposition L.K. Advani who has called the accusation ridiculous. Also on the list of the accused is former prime minister Atal Bihari Vajpayee. Both Vajpayee and Advani say the demolition of the Babri Masjid occurred spontaneously and was not planned.

ArcelorMittal plans new steel plant in Karnataka

Debarati Roy / Bloomberg — Mon, 23 Nov 2009 18:12:00 GMT

Mumbai: ArcelorMittal is considering setting up a steel plant in Karnataka, its third in the country, to tap demand in India.

Exploring options: ArcelorMittal’s CEO Lakshmi Mittal.

The firm submitted its interest to set up a plant with a capacity of as much as 6 million tonnes to the state government on 21 November, Vijay Kumar Bhatnagar, the head of ArcelorMittal’s India unit, said in a telephone interview on Monday.

“The feasibility study for the plant will be completed within four months,” he said. “This plant is in addition to our other two planned plants,” Bhatnagar said. “India’s demand for steel is set to grow.”

India’s steel demand may rise as much as 10% this fiscal year, almost double the pace previously estimated, as the government spends more on infrastructure, according to the steel ministry.

Demand grew by about 7% in the first six months of this fiscal year ending 31 March. In October 2005, ArcelorMittal said it plans to set up a factory with a capacity of 12 million tonnes in Jharkhand.

The following year it announced another plant of the same size in neighbouring Orissa. Since then, it has been unable to secure land for the two $10 billion factories.

ArcelorMittal’s chief executive officer Lakshmi Mittal is scouting for alternative locations because no progress is being made at the existing sites, ‘PTI’ reported on 28 October.

(Abhishek Shanker in Mumbai contributed to this story.)