Andhranews

Mumbai, Aug. 24: VSNL on Thursday announced a reduction of 40 per cent in the Internet-leased lines (ILL) and 25 per cent in the international private leased circuits (IPLC) from September 1. Tata Group company, Videsh Sanchar Nigam Limited (VSNL), on Thursday announced that it plans to invest $600 billion to build two new submarine cable systems, one between India and Europe and the other between Singapore, Hong Kong and Japan. The India-Europe cable would also provide connectivity to the Gulf region.

This investment is part of the Rs 1.2-lakh crore investment that the Tata Group has planned to invest in the next three to five years. Mr Kishor Chaukar, Tata group nominee on the VSNL Board, said that investments would be in auto, telecommunications, steel, chemicals and power. “These are the areas in which we believe the companies can contribute value for money for its customers and investors across the sectors,” Mr Chaukar said.

He added that Thursday’s announcements reflect the progress VSNL has made in four years “from being a monopoly to emerging as a highly competitive force in the global telecom space. The management has very clearly tried to respond to the vision set out by Mr Ratan Tata when he took over as chairman of VSNL after disinvestment.” VSNL’s reduction in the prices of IPLC and ILL will meet the rapidly growing demand of several Indian companies investing overseas.

These products are offered in India using VSNL’s global network that spans over 200,000 route kms with 275 PoPs connecting 200 countries. Mr N. Srinath, executive director, VSNL said that the market for international Internet bandwidth is expected to expand as the reduced prices will encourage demand from new customer segments like the small and medium enterprises, smaller ISPs and academic institutions. Mr Srinath said that the India-Europe cable system is likely to be completed by 2008 with the build cost of approximately $350 million and the intra-Asia cable system is likely to be completed by 2007 with an investment of around $250 million. These are the fastest-growing regions in the world.

According to Mr Srinath, the company is looking for partners for making the investment and the talks are in process with international carriers in the US and Europe. He said that some of the companies in West Asia are showing interest in the partnership, but nothing is finalised yet.

New Delhi, Aug. 24: Bharti Airtel, leading private sector providers of telecommunication services in the country, on Thursday announ-ced the signing of a $1-billion network expansion contract with Ericsson. The three-year service contract with Ericsson is towards the design, planning, supply and installation commissioning of Airtel networks.

Ericsson will also upgrade the network with mobile softswitch (Media Gateway and MSC Servers), the solution that paves the way to an all-IP network. Bharti Airtel claimed that the contract with Ericsson will be able to reduce the operational costs of the company and will help it to introduce new services in a cost-efficient way. The contract with Ericsson covers 15 telecom circles. Speaking about the contract, Mr Manoj Kohli, president, Bharti Airtel said, “Our partnership with Ericsson will allow us to focus on delivering better customer experience even as we leverage the world-class expertise of our partners to roll out our networks across all census towns by March 2007.”

Airtel claimed that this partnership will enable it to channelise its resources and expertise to its core areas of product innovation, value-added services, marketing, branding and pricing, while simultaneously providing world-class mobile services by leveraging Ericsson expertise in network management. “Our partnership with Bharti Airtel resulted in the first managed services contract in the industry. Speed of rollouts play an extremely important role in large expansions of this nature,” said Mr Mats Granryd, managing director, Ericsson India.

Kuala Lumpur, Aug. 24: India on Thursday strongly supported Japan’s proposal for a pan-Asia trade block that will include 10 members of Asean and six other countries. Apart from Asean members and India, the proposed Free Trade Area will include China, Japan, South Korea, Australia and New Zealand. “We strongly support it,” commerce and industry minister Kamal Nath said after a meeting with his Japanese counterpart Toshihiro Nikai on the sidelines of the 38th Asean Economic Ministers Meeting (AEM) here. The proposal for a 16-nation free trade zone has been mooted by Nikai. Mr Nath is in the Malaysian capital to attend the Asean (AEM)-India Consultations. He said New Delhi fully backed the Nikai initiative, as the proposal is called, which will result in huge economic gain for this part of the world.

Japan on Wednesday proposed the creation of a 16-nation Pan-Asian Free Trade Area, including India, with economic activity worth $9 trillion. The proposed Free Trade Area will have a population of 3.1 billion people and a GDP of $10 trillion. However, Asean felt that while studies for a single market in East Asia covering 16 countries was fine, what was more crucial was the pact between the grouping and Tokyo. Only then, should the grouping clinch similar single markets with China and South Korea and thereafter bring in Australia, New Zealand and India, the Asean ministers felt.

Japan’s proposal is an expansion of an earlier East Asia FTA study chaired by China, which included 13 nations comprising Asean, China, Japan and South Korea. Tokyo’s plan (Asean+6) includes India. Tokyo has said it will provide upto $100 million to fund efforts to set up a economic partnership in East Asia, which could form the foundation of the East Asia Free Trade Area.

Asean includes Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam. Japanese minister Nikai clarified that Tokyo was not proposing the Asean plus 6 Free Trade Area to counter China’s influence in the region. New Zealand, which is also part of the proposed Asean plus 6, said it was confident that China would accept Tokyo’s proposal.

New Delhi, Aug. 24: The controversy on 3G mobile telephony band refuses to die. Now, the GSM operators association COAI, in a letter to Trai, has opposed the proposal of a separate band for CDMA operators. COAI director general T.V. Ramachandran, in a letter addressed to Trai’s chairman N. Misra, has said that they are distressed by the fact that despite being fully aware of several adverse implications of the mixed band plan, Trai is now contemplating a pilot project to be implemented by the CDMA operators.

The letter further said that as in the previous consultations, Trai had rejected mixed band and as no new technological developments have taken place, reconsideration is not justified. It goes on to quote the findings of three reports to show that mixed band plan is not a viable option.

New Delhi, Aug. 24: Parliament on Thursday approved a bill for giving more flexibility to board of directors and improve corporate governance standards in public sector banks after Rajya Sabha passed it by voice vote. The Banking Companies (Acquisition and Transfer of Undertakings) and Financial Institutions Laws (Amendment) Bill, 2005, which includes the amendments suggested by the standing committee of Parliament, was passed by Lok Sabha on Wednesday.

The bill includes a number of provisions for giving greater flexibility to the board of directors and improve corporate governance norms in State-run banks. The bill, which was cleared by the Union cabinet in May this year, also envisages increasing the number of whole-time directors from two at present to four, besides making government share transferable. It would also help bring public sector banks in tune with changing global scenario and modern business practices.

In another development a Special Purpose Vehicle (SPV) has been planned to be set up under the railways ministry to implement the ambitious Rs 66,000 crore rail freight corridor that aims at linking the four metros and weaning away goods traffic from roads. The SPV, cleared by the Cabinet on Thursday, will help in time-bound execution of the rail freight corridor, which will broadly run parallel to the existing railway lines connecting Delhi, Mumbai, Chennai and Kolkata, parliamentary affairs minister P.R. Dasmunsi said.

The SPV will have the status of a railway administration under the Railways Act, 1989, and will exercise powers and discharge the responsibility for the functions assigned to it under the concession agreement, he said after the cabinet meeting.
The SPV, which will be wholly-owned by the railways, will be a sort of public sector company exclusively for implementing the project, sources said. It would have an authorised capital of Rs 4,000 crore and an initial paid-up capital of Rs 50 crore, the sources added.

Hyderabad, Aug. 24: ICICI Prudential Life Insurance Co., a private life insurer, expects to better its cost ratio in the next few years even as it waits for breaking even after six years of operations, Mr Sandeep Batra, Chief Financial Officer, said on Thursday. “Currently, we have a cost ratio of 14 per cent which would be brought down to single-digit figures in a few years,” Mr Batra said. The cost ratio tells how large a portion of premiums earned is needed to cover the expenses of the insurance business; it is a measure of the efficiency of an insurance company’s operations.

In the Indian insurance industry, the only market leader Life Insurance Corporation has a cost ratio of 8 per cent, which most of the private life insurers have set as a target to achieve. Additionally, ICICI Prudential Life also sees a delay in reporting net profit because of what company officials claim “unexpected growth in business”. Admitting to the fact that returns on investment for insurance firms take six-to seven years, Mr Batra said, “We have not yet reported profits and we do not see it happening by this year-end too.”

With a total Funds Under Management (FUM) of Rs 10,366 crores, ICICI
Prudential Life Insurance has sold upto 2.5 million policies till date. Earlier, Mr Batra launched a premium guarantee product — InvestShield Life and Immediate Annuity product for the retired persons. InvestShield Life would protect investors from capital erosion since upto 40 per cent of the investments would be made in equity and the remaining in debt. The Immediate Annuity plan is aimed for retirees.

Chennai, Aug. 24: Goodyear India Ltd, a unit of Goodyear Tire and Rubber Co. of the US, is planning to set up 300 branded retail outlets in India within the next three years. “We are aiming to gain a competitive advantage in the replacement market with this move,” Mr Antonio Capellini, chairman and managing director of Goodyear India Ltd, told reporters here on Thursday. The company opened six branded outlets in Chennai on Thursday.

Goodyear would be setting up 50 shop-in-shop branded stores by the end of 2006 and it would invest Rs 50 crores to strengthen its sales network in India, he said.
Mr Capellini said the company is introducing its international format shop-in-shop outlet for the first time in India, starting with the Chennai stores.

In addition to offering customers the whole range of Goodyear tyres, these showrooms would also offer customers a range of value-added services, not offered in any tyre outlets in the country. “We have entered into an exclusive tie-up for car-care products to the new outlets including car perfumes, car wash, tyre shine, etc making it very convenient for customers to purchase their requirement under one roof,” he said.

He said the company has 15 per cent market share in the domestic tyre market. Of this, 40-45 per cent contribution is coming from the replacement market. The passenger radial tyre market in India is estimated to grow about 15 per cent a year.

London, Aug. 24: Global demand for raw materials will shoot higher in the next 20 years thanks to rising consumption from emerging nations like China and India, according to a report from Swiss banking giant UBS. “Consumption of natural resources will expand during the next two dec-ades, driven by continued industrialisation and growth of domestic demand in em-erging market countries,” UBS said in a report. The bank emphasised the “enormous” appetites of China and India, the two most densely populated countries on the planet, where “economic growth ... has far outpaced growth in developed countries during the past 15 years”.

China is the second biggest global consumer of crude oil — after number one the United States — and is also the biggest world market for copper, nickel, platinum and cotton. India, meanwhile, is the largest market for gold and also has fierce demand for oil. The report read: “Strong demand for natural re-sources from emerging market countries, a sharp slowing in new reserve discoveries, and low inventory levels will likely extend the current bull market in commodities” which began around five years ago.

UBS analysts forecast that crude oil supply would struggle to keep pace with demand, while oil production was predicted to peak during the next 25 years.
Underinvestment in exploration would also limit expansion in production of base metals such as copper, nickel and aluminium. But the report added: “The emergence of cost-effective fuel substitutes will enable reduced reliance on crude oil.”

Hyderabad, Aug. 24: India needs to reform its labour laws quickly to make the labour market more flexible, because of the prospect of largescale unemployment, of over 30 per cent by the year 2020, according to a report by TeamLease Services. The report says that currently there are more than 2,500 Central and 25,000 state laws governing the labour market. “There is a need for the elimination, harmonisation and re-engineering. The three laws that require urgent attention are the Industrial Disputes Act, the Contract Labour Act and the Trade Union Act,” TeamLease, a temping firm, says.

“India’s working population, between 20-59 years of age, stands at 567 million in 2006. This segment is growing at 2.4 per cent annually. In 2020, in terms of the share of this group in our total population, we are looking at a working age population of 56 per cent of the total estimated population of 1.35. The overall labour force will come up in 2020 will number around 716 million,” the report says.

According to the report, most of this labour force faces the prospect of two “very hard realities”, including widespread unemployment or poor employment. “The expected unemployment if the labour force continues to increase at about 2.5 per cent per annum, with the economy growing at about eight per cent, and employment elasticity remaining at 0.15 per cent, would be 30 per cent of the labour force (by 2020),” the report says.

Referring to the “labour demand ecosystem” in different states, the report says that as of 2005, Gujarat had the best employment ecoysystem closely followed by Goa and Himachal Pradesh. “More than the ranks, the index values reveal that there are no significant differences between the top five states. Kerala, Andhra Pradesh and Tamil Nadu group for the next group. Karnataka is far below, predominantly due to poor infrastructure as well low investment.” The “worst States” in terms of the “employment ecosystem” are Bihar, Uttar Pradesh and J&K.

With the proliferation of communications technology, beginning with the humble wireline phone, to GSM and CDMA, to the new-fangled WCDMA/HSDPA, Wi-Max, Wi-Fi and Bluetooth, the most vexing issue for operators is how to make the different technologies work together, and with the public switched technology network. The result is that consumers are stuck with their technology, be it global system fo mobile or Code Division Multiple Access.

Several companies are working on trying to make the different technologies talk to each other seamlessly, without consumers getting their knickers in a twist. Axesstel, Inc., a California-base start-up, appears to be the first mover in this
space, given that it has been awarded a patent by the United States patent and trademark office.

According to Axesstel, the patent provides for the intelligent control of primary and secondary processors, thereby enabling hybrid or converged devices that can support two or more telecommunication technologies. The primary processor and secondary processor can be any combination of wireless technology such as GSM, CDMA, CDMA2000 1xEV-DO, WCDMA/HSDPA, Wi-Max, Wi-Fi, Bluetooth or wire-line technology such as PSTN.

Hybrid device

We view this patent award to be the cornerstone for our current product development targeted to better serve emerging markets and for future development of advanced 3G devices that converge voice and data, wireless and wire-line, and WWAN and WLAN technology to allow us to penetrate developed markets,” the company says. “Hybrid devices integrated with our patented technology will provide users with seamless connectivity to voice and data while at home or on the road with one device.” Axesstel says that a hybrid phone can be integrated with a primary wireless processor and a secondary wireless processor.

The primary wireless processor controls the overall operation of the hybrid device and also controls the secondary processor to make a voice connection using different landline or wireless technologies. The primary processor also controls the user interface such as speaker, display, keypad, microphone and GPS functions. Also, a device can be integrated with a CDMA primary processor and a cordless secondary processor. If the device is within cordless range, the primary CDMA processor will control the secondary cordless processor to establish the connection to the PSTN to enable a voice call.