Andhranews

New Delhi, Aug. 7: Even as India, Pakistan and Iran decided last week to appoint an international consultant to decide on the pricing of gas Iran is to sell to India and Pakistan, the United States on Monday reiterated its opposition to the proposed $7-billion IPI gas pipeline project.

While earlier US secretary of secretary Condoleeza Rice expressed misgivings about the trans-national pipeline project, which is to run from Iran though Pakistan to India, on Monday Richard Boucher, US assistant secretary of State for south and central Asia, who is in India on a State visit, said that instead of Iran, India must look towards central Asian nations to meet its growing demand for petrol and gas.

Addressing a Ficci meet, Mr Boucher, in response to a specific question on the proposed gas pipeline, said that it was for India to decide if it wants to import gas from Iran but added that India should also think whether that project is commercially viable or not. “As far as I think, Iran is not a stable and reliable country and India should instead look towards other central Asian countries for oil and gas,” said Mr Boucher. Mr Boucher also proposed the name of Kazakhstan as one of central Asian country from were India could import gas and petrol in future.

“Well, you will have to think about a country from where you could import gas and petrol for another 50 years and in that context Kazakhstan fits the bill,” he said. India, Pakistan and Iran, at a tripartite meeting here on August 4, had decided to appoint a consultant to advise on pricing of gas for the transnational pipeline.

The trilateral talks on the pipeline have been plagued by differences over pricing issue. Iran is demanding nearly double of what India and Pakistan are willing to pay for the gas bought from Iran. Mr Boucher also said that by restoring peace and stability and opening up Afghanistan as a transit route for trade, the US desires greater flow of energy and manufactured products between central Asia and South Asia.

Mr Boucher was more forthcoming on the issue of outsourcing and said that some people have misunderstood it and have given “outsourcing a bad name”. “US President George W. Bush has said that outsourcing is good and it make companies more efficient,” Mr Boucher added.

New Delhi, Aug. 7: The Securities and Exchange Board of India will soon be announcing a policy statement on short-selling of shares, Mr M. Damodaran, the chairman of the market regulatory agency, said on Monday.

“You will soon see a policy statement (on the issue),” Mr Damodaran told reporters in Gurgaon, after inaugurating a week-long independent directors’ programme for senior
officers of the armed forces, organised by the Management Development Institute. He, however, declined to elaborate on whether the policy would allow short-selling by institutional investors or not.

The Sebi chairman said that unless all issues relating to short-selling are addressed, a decision could not be announced. All those concerned with the matter are being consulted, Mr Damodaran added. Short-selling refers to the selling of company scrips without actually owning them or selling them by delivering borrowed stocks. This is currently permitted for retail investors.

The issue of allowing institutional investors to short-sell is linked to the programme for stock lending and borrowing. The stock lending and borrowing programme was in vogue for institutional investors until 1997 under the Foreign Exchange Regulation Act, which was replaced with the Foreign Exchange Management Act in 1999-2000.

Now the issue is whether the proposed lending and borrowing programme could be allowed for foreign institutional investors under Fema. A revised scheme for lending and borrowing stocks was prepared after the stock markets went into freefall in May this year.

Mumbai, Aug. 7: The rains dampened the sentiments at the stock exchanges on Monday which not only saw a lacklustre performance but the lowest turnover in the last eight months.

The Sensex was down 53.87 points at 10,812.64, while the Nifty closed down 25.65 points at 3151.10. While there was no ostensible negative news to dampen the market sentiment in India, the Asian markets, which were also down, were worried about the decision that the US Federal Reserve may take on Tuesday on interest rates. The Nikkei was hardest hit and was down 345.12 points.

Monday’s trading was marked by the lowest turnover for this year at Rs 20,097.85 crores. The F&O sector accounted for R 13,930.1 crores. Trading on the National Stock Exchange was a mere Rs 4,132.66 crores and on the Bombay Stock Exchange it was Rs 2,035 crores.

The market breadth saw 382 stocks end in the green and 509 in the red. Among the stocks that were big losers were the information technology and auto stocks. Infosys was down Rs 6.65, TCS down Rs 14, Satyam Rs 16.45 and Wipro Rs 13.80.

Among the auto stocks Bajaj Auto was down Rs 30.05, Tata Motors Rs 10.20, Maruti Rs
15 and Hero Honda Rs 18.25.

New Delhi, Aug. 7: The government refused to review its decision rejecting the price of natural gas proposed to be sold by Reliance Industries Ltd to an Anil Ambani group firm.
“There will be no review of the decision. If we allow the price RIL has proposed, the government will suffer huge losses,” Union petroleum minister Murli Deora told newsmen on Monday, when asked about Mr Anil Ambani’s statement on Sunday, saying that the government had taken a “premature” decision.

Mr Murli Deora said that ever since he has joined the government, he has been hearing about the disputes between Anil and his elder brother Mukesh Ambani. “Don’t we (the ministry) have any other job than to settle their matters,” he retorted and said that the ministry has already made its position on the issue clear.

The petroleum ministry had late last month rejected the price of $2.34 per million British thermal unit proposed by Mukesh Ambani-led RIL for the sale of natural gas to Reliance Natural Resources Ltd, on grounds that it would lead to massive losses to the government exchequer. “Rejection of RIL-RNRL gas price by ministry of petroleum is premature and unfortunate,” Mr Anil Ambani had said on Sunday.

Hyderabad, Aug. 7: Pennar Industries Ltd., a cold-rolled steel maker, is setting up its fourth manufacturing unit to cater to the demand from the automotive sector. The unit is being built in Chennai at an estimated cost of Rs 15 crore, Nrupender Rao, chairman of the company, said on Monday.

Pennar Industries currently has three production units — in Patancheru, Isnapur in Andhra Pradesh and Tarapur in Maharashtra. Mr Rao said the Chennai unit, which is expected to be commissioned in December, will be making profiles for the car industry, and other components. “The unit will add another 30,000 tonnes to our annual capacity of 142,000 tonnes,” he said.

The Chennai plant is being funded from the proceeds of a convertible debenture issue, which raised Rs 122.4 crore. Two private equity firms — Equity Capital of New York and Spinnaker Capital of the London — have invested in the debenture issue. “Of this Rs 50 crore will be in equity shares, at the rate of Rs 14.75 per share, a 9.5 per cent premium,” Mr Rao said.

Pennar Industries’ stock closed at Rs 15.95 on the Bombay Stock Exchange on Monday. Pennar also utilised the funds to make a one-time settlement of the company’s long-term debt. “We had a total long-term debt of Rs 200 crore, but over the past few years we managed to reduce it to Rs 138 crore through a corporate debt restructuring plan and OTS,” he said.

According to Mr Rao, the company would be focussing on value-added products for the white goods and automotive sectors. “The past 10 years have been extremely difficult for the Pennar Group. Pennar Aluminium was handed over to Hindalco by RCIL, while we brought in a German partner for Pennar Profiles. The German firm is now majority shareholder in Pennar Profiles,” he said.

Referring to Pennar Industries, Mr Rao said that sales had plunged from Rs 312 crore in 1995-96 to Rs 76 crore in 2001-02. “The CDR and one-time settlements and the buoyancy in the steel industry helped the company in achieving a turnaround,” he said. Pennar recorded revenues of Rs 558 crore during the 15-month period ending June 30, 2006.

Mumbai, Aug. 7: The boards of the Andhra Bank, Bank of Baroda and the Oriental Bank of Commerce ratified the hike in benchmark prime lending rates or PLR, while the board of the OBC also rolled back the hike in its home loan rates.

Andhra Bank ratified a 50 basis point or 0.5 per cent hike in its Prime Lending Rate. The Bank of Baroda was told by the finance ministry in a letter that it had “certain concerns” about the hike in its benchmark PLR (BPLR) rate from 11 per cent to 11.5 per cent as per the decision of the board taken on July 28. The concerns were with regard to lending to productive sectors.

Accordingly, the bank’s board met on Monday to examine the concerns of the government and came to the conclusion that lending to the productive sectors would not be affected by the hike in BPLR. In a press statement, the bank said, “The hike in BPLR would facilitate rechannelising the credit flows from sensitive sectors like commercial real estate to productive sectors as most of the lending to sensitive sectors is at the BPLR level and to the productive sectors it is at the sub-PLR level.”

The BoB board, however, directed the bank to ensure that sufficient liquidity is maintained for smooth flow of credit to productive sectors and that the bank may closely monitor this performance in regard to flow of credit to productive sectors. OBC, which had hiked its home loans rates by 50-100 basis points last week, said that it would keep this hike on hold till September 30. However, it would go ahead with the hike in interest rates on home loans over Rs 20 lakhs due to higher provisioning.

Chennai, Aug. 7: An industry chamber study estimates that the annual growth rate of the Indian economy by 2015 would touch over 12 per cent, in which the housing and real estate sector would have the potential to grow at 14 per cent per annum and double its contribution to the GDP from the current level of less than one per cent.

The housing and real estate sector would generate over four million jobs by 2015 with demand for dwelling units likely to rise to 80 million for lower-middle and low income groups, involving an estimated investment of $670 billion, the study said.

The Associated Chambers of Commerce and Industry of India study, to be released soon, projects that demand for dwelling units will grow to 90 million by 2020, which would require a minimum investment of $890 billion.According to official estimates, the Indian housing sector at present faces a shortage of 20 million dwelling units for its lower-middle and low income groups which will witness a spurt of about 22.5 million dwelling units by the end of 10th Plan period.

Commenting on the study, chamber president Anil K. Agarwal said that investment required for constructing the dwelling units and related infrastructure during the projected period would be between $670 billion and $890 billion. This would mean about an investment of $34 billion to $45 billion per annum during the period. Currently, the housing and real estate sector is considered as one of the major engines to propel the growth, with its current size of roughly $14 to $15 billion.

The sector is the third-largest employer next only to the agriculture and textile sectors. The study has suggested a multi-pronged strategy to the government to ensure that the projected growth of housing and real estate in terms of dwelling units and their investments is achieved. The strategy calls for conferment of infrastructure status on the housing sector, to enable it to have easy access to low-cost institutional funds as also allow this sector to tap long term funds.

Amendments need to be incorporated in the Central urban regulations and Rent Control Acts and ULCA of all the State governments should be scrapped to encourage entry of FDI in real estate developments, it suggested.

For parents, an endemic worry is what their wards are up to online, especially when there is no adult supervision. The greatest fear is that the kids, particularly teenagers, will log into sites with content or chats inappropriate for their age. Sure, there are technologies that can try an ensure that an impressionable youngster does not crawl into a porn site, but nobody is really sure how effective they are.

Now, a company in the United Kingdom, NetIDme, has launched a virtual ID card designed to keep children safe while surfing the Internet. How does the virtual ID card work. According to the Glasgow-based Internet ID verification company, the electronic identity card displays the user’s first name, age, gender, and general location. Children can use it to swap online when in chat rooms and social networks or exchanging instant messages.

NetIDme MD Alex Hewitt says he decided to design the card after finding that his daughter could only verify the age and identity only one-third of her 150 online friends. “I needed to come up with a way to protect her, so I created software that works on a secure public and private key system,” he says.

“If you want to give me your ID, the system creates a virtual ID card and sends it to me. Only I can view and lock that information, so I can’t pass on the card to someone else and pretend to be you.” Children are encouraged to check the identity of people they communicate with online by being awarded points for each ID they check or issue, says TechWeb.

The points are exchanged for prizes like music. Parents and children can apply for the card online. Mr Hewitt admits nothing is fool proof. “The only way to guarantee the system is 100 per cent safe is to unplug the Internet.” You can try doing that at your peril.

Internet TV

Although online content aggregators are in the early experimentation stages of rolling out video services, they will have some dramatic revenue-generating opportunities in the next five years. The worldwide market for online content services is expected to expand by a factor of 10, growing from about 13 million households during 2005 to more than 131 million households by 2010, says In-Stat, a high-tech market research firm.

“AOL, Google, Yahoo!, MSN, Apple, major Broadcast TV networks, Pay-TV services and local TV stations are all working on ways to blend their video assets with personalised TV services,” it says. Worldwide broadband households will more than double between 2005 and 2010, growing from about 194 million in 2005 to more than 413 million by 2010, the research firm says.

Hyderabad, Aug. 7: GMR Infrastructure Ltd, an infrastructure company, and Tech Mahindra Limited, a telecom IT solutions provider, which concluded their IPOs last week, said on Monday they have priced their stocks at Rs 210 and Rs 365 per equity share respectively.

At Rs 210 per share, GMR Infra will be raising Rs 800.80 crores, while Tech Mahindra, a joint venture by Mahindra & Mahindra and BT Group plc of the United Kingdom, will be raising about $100 million (about Rs 450 crores), company sources said. The two public issues were the biggest since the Indian stock markets nose-dived in May.

Several big-ticket IPOs have either been postponed or shelved because of the moribund stock market. While the Tech Mahindra issue was subscribed 72 times, the GMR Infra issue was subscribed 6.68 times. GMR Infra’s IPO comprised 38,136,980 equity shares of Rs 10 each, including 500,000 equity shares reserved for eligible employees and a net public offer of 37,636,980 equity shares. The net offer to the public constituted 11.37 per cent of the fully diluted post-issue paid-up capital of the company.

Both issues were made through 100 per cent book building process. According to GMR, the principal assets of the company consist of four power plants of which two are in commercial operation, one is being constructed and is almost complete and the other is under development; six road projects of which two are in commercial operation and four are under development and two airport projects, one of which is a greenfield airport under development and the other is an existing airport undergoing modernisation and redevelopment.

New Delhi, Aug. 7: FLAG Telecom, a subsidiary of Reliance Communications, has signed a contract with T-Com, the broadband and fixed-line strategic business area of German giant Deutsche Telekom AG. Under this contract, FLAG Telecom would provide 180 gigabits (GB) of high-quality connectivity to T-Com between Europe and the United States to meet their growing business requirements.

FLAG Telecom is a member of the Reliance-Anil Dhirubhai Ambani Group and has an established customer base of over 200 leading operators, including all of the top-ten international carriers. FLAG owns and manages an extensive optical fibre network spanning four continents, connecting key business markets in Asia, Europe, West Asia and the USA.

While announcing the agreement, Mr Gary Adey, V-P sales Europe, said in a release that Flag telecom is delighted to complete this milestone agreement with T-Com. “We have worked closely with Deutsche Telekom to understand their needs while designing this flexible, scalable and high quality solution,” it further added.

This additional 180 GB capacity will enable Deutsche Telekom to implement route diversity between the key business centres of Europe and the US and, consequently, offer enhanced scalability and reliability of service to its customers.

New York, Aug. 7: The shutdown of a major Alaskan oil field sent oil prices sharply higher on Monday and prompted investors to sell stocks on inflation fears, one day before the Federal Reserve’s next decision on interest rates.

BP Plc said late on Sunday it would shut down the Prudhoe Bay oilfield, which represents 8 per cent of daily US crude production, due to possible pipeline corrosion. As a result, Light Sweet crude for September delivery on the New York Mercantile Exchange climbed $1.74 to $76.50 a barrel in electronic trading by afternoon in Europe.

At London’s ICE Futures exchange, Brent crude for September jumped $1.22 to $77.39 a barrel. The spike in oil prices weighed heavily on investors concerned about another rate hike from the Fed. While the economy is slowing, leading analysts declare that the Fed would not raise rates on Tuesday. However, there’s concern that rising energy prices could lead to broader inflation or a halt to economic growth.

In mid-morning trading, the Dow Jones industrial average fell 21.37, or, 0.19 percent, to 11,218.98. Broader stock indicators also dropped. The Standard & Poor’s 500 index lost 2.38, or 0.19 per cent, to 1,276.98, and the Nasdaq composite index dropped 7.80, or 0.37 per cent, to 2,077.25. Bonds lost ground as well in advance of the Fed meeting, with the yield on the benchmark 10-year Treasury note rising to 4.92 per cent from 4.9 per cent on Friday.