Finance Minister P Chidambaram today announced waiver of Rs 50,000 crore agricultural loans outstanding against nearly four crore farmers across the country.
The beneficiaries would include about three crore small and magrinal farmers - owining two hectare or less land - and about one crore others.
While small and marginal farmers would get a total waiver, others would be entitled to 25% rebate and one-time settlement (with an estimated Rs 10,000 crore) with credit insitutions including scheduled banks and cooperative banks.
Presenting the scheme during the presentation of the budget in the Lok Sabha, Chidambaram said the scheme would be applicable to loans taken up to December 31, 2007. The process of waiving off of the loans would be completed by June 30, he said.
Farmers availing the scheme would be entitled to fresh loans from credit institutions in the normal way, he added.
Thursday, February 28, 2008
Budget 2008: Hybrid cars get govt nod
After much pre-budget debate, the union government has announced a slash in excise duty rates for hybrid cars.
Finance Minister has provided relief to auto manufacturers of hybrid cars by reducing the excise duty on them from 24% to 14%. These cars are currently not on sale in India, and use a combination of electric motors with gasoline/diesel engines to enhance efficiency and reduce pollution.
Effective April 1, 2008, the move paves the way for manufacturers such as Honda Siel, Toyota India and Mahindra & Mahindra to immediately launch their vehicles that were on display at the Auto Expo in January. These include the Honda Civic hybrid and the Mahindra Scorpio hybrid, while Toyota have displayed the technologies surrounding the Prius in past years.
Both the Prius and the Civic will enter through the import route, while the hybrid Scorpio will be developed and locally manufactured.
Finance Minister has provided relief to auto manufacturers of hybrid cars by reducing the excise duty on them from 24% to 14%. These cars are currently not on sale in India, and use a combination of electric motors with gasoline/diesel engines to enhance efficiency and reduce pollution.
Effective April 1, 2008, the move paves the way for manufacturers such as Honda Siel, Toyota India and Mahindra & Mahindra to immediately launch their vehicles that were on display at the Auto Expo in January. These include the Honda Civic hybrid and the Mahindra Scorpio hybrid, while Toyota have displayed the technologies surrounding the Prius in past years.
Both the Prius and the Civic will enter through the import route, while the hybrid Scorpio will be developed and locally manufactured.
Budget 2008: Highlights
Hikes tax-free income from Rs 1,10,000 to Rs 1,50,000
10% tax on income from Rs 1,50,000 to Rs 3,00,000
20% tax on income from Rs 3,00,000 to Rs 5,00,000
30% tax on income over Rs 5,00,000
Women exemption increases from Rs 1,45,000 to Rs 1,80,000
Senior citizen exemption increases from Rs 1,95,000 to Rs 2,25,000;
Banking cash transaction tax to be removed
STT applicable on commodities trading
Tax on short term capital gains increased to 15% from 10%
Debt Waiver: Total estimate Rs 60,000cr; Overdue loans to be waived will be Rs 50,000 crore; One-time settlement estimated at Rs 10,000 crore; all agri loans by RRBs, co-operatives, SCBs overdue taken before March 2007 and outstanding on December 2007 are covered. Loans waived for marginal farmers holding up to 1 hectare and small farmers up to 2 hectare
Service tax limited hiked to Rs 10 lakh.
Excise on two-wheelers reduced from 16% to 12%
Reduced general CENVAT from 16% to 14%
Duties on iron ore exports increased to Rs 3,000/tn
Project import customs duty reduced from 7.5% to 5%; Steel melting scrap and aluminium scrap made nil; Life saving drugs customs duty from 10% to 5%;
No change in peak rate of customs duty;
Revenue deficit at 1.4% against budget estimate of 1.5%; To eliminate revenue deficit in FY10; Fiscal deficit at 3.1% against budget estimate of 3.3%; Plan expenditure Rs 2,43,386 crore;
Defence allocation increased from Rs 96,000cr to Rs 1,05,600 crore; Food subsidies at Rs 32,667 crore;
Exchange-traded currencies; interest rate derivatives to be introduced;
TUF to increase to Rs 1,090 crore; Rural Infrastructure Development Fund increased to Rs 14,000 crore;
Saving rate at 35.6%, investment rate at 36.3 %;
Rs 1,000cr to be placed with LIC for covering an additional 1cr landless households; PAN to be extended for all transactions in financial markets, subject to suitable threshold;
Coal regulator to be set up; GQ completed 96.48%, National fund for transmission and distribution;
To continue with fertiliser subsidies, may move to nutrient-based subsidies; Rs 20,000 crore allocated for irrigation; Agricultural credit at Rs 2,80,000 crore; To mobilse Rs 10,000cr for plan capital expenditure;
Rs 16,202cr scheme that will cover at least 33% women;
Chennai desalination plant to get Rs 300cr in 08-09;
JNURM to get Rs 6,866cr in 2008-09 from Rs 5,482cr in 07-08;
Anganwadi workers remuneration to be increased to Rs 1,500 per month.
Rs 30,000 cover for unorganised sector; Centre to share Rs 200cr premium; Health allocation increased by 15%
Govt to interconnect all national institutions on a knowledge network; Govt to establish 16 central universities; 3 IITs in Bihar, AP and Rajasthan;
Mid-day meal scheme extended in government and government aided schools in upper primary classes. Total coverage of 13.9 crore children; Education allocation increased by 20%
2008-09 should be a year of consolidation; We can do better to achieve inclusive growth; The government will manage capital inflows along with RBI;
Total agricultural output 219.32 million tonne. Agriculture growth rate at 2.6% in 2007-08
10% tax on income from Rs 1,50,000 to Rs 3,00,000
20% tax on income from Rs 3,00,000 to Rs 5,00,000
30% tax on income over Rs 5,00,000
Women exemption increases from Rs 1,45,000 to Rs 1,80,000
Senior citizen exemption increases from Rs 1,95,000 to Rs 2,25,000;
Banking cash transaction tax to be removed
STT applicable on commodities trading
Tax on short term capital gains increased to 15% from 10%
Debt Waiver: Total estimate Rs 60,000cr; Overdue loans to be waived will be Rs 50,000 crore; One-time settlement estimated at Rs 10,000 crore; all agri loans by RRBs, co-operatives, SCBs overdue taken before March 2007 and outstanding on December 2007 are covered. Loans waived for marginal farmers holding up to 1 hectare and small farmers up to 2 hectare
Service tax limited hiked to Rs 10 lakh.
Excise on two-wheelers reduced from 16% to 12%
Reduced general CENVAT from 16% to 14%
Duties on iron ore exports increased to Rs 3,000/tn
Project import customs duty reduced from 7.5% to 5%; Steel melting scrap and aluminium scrap made nil; Life saving drugs customs duty from 10% to 5%;
No change in peak rate of customs duty;
Revenue deficit at 1.4% against budget estimate of 1.5%; To eliminate revenue deficit in FY10; Fiscal deficit at 3.1% against budget estimate of 3.3%; Plan expenditure Rs 2,43,386 crore;
Defence allocation increased from Rs 96,000cr to Rs 1,05,600 crore; Food subsidies at Rs 32,667 crore;
Exchange-traded currencies; interest rate derivatives to be introduced;
TUF to increase to Rs 1,090 crore; Rural Infrastructure Development Fund increased to Rs 14,000 crore;
Saving rate at 35.6%, investment rate at 36.3 %;
Rs 1,000cr to be placed with LIC for covering an additional 1cr landless households; PAN to be extended for all transactions in financial markets, subject to suitable threshold;
Coal regulator to be set up; GQ completed 96.48%, National fund for transmission and distribution;
To continue with fertiliser subsidies, may move to nutrient-based subsidies; Rs 20,000 crore allocated for irrigation; Agricultural credit at Rs 2,80,000 crore; To mobilse Rs 10,000cr for plan capital expenditure;
Rs 16,202cr scheme that will cover at least 33% women;
Chennai desalination plant to get Rs 300cr in 08-09;
JNURM to get Rs 6,866cr in 2008-09 from Rs 5,482cr in 07-08;
Anganwadi workers remuneration to be increased to Rs 1,500 per month.
Rs 30,000 cover for unorganised sector; Centre to share Rs 200cr premium; Health allocation increased by 15%
Govt to interconnect all national institutions on a knowledge network; Govt to establish 16 central universities; 3 IITs in Bihar, AP and Rajasthan;
Mid-day meal scheme extended in government and government aided schools in upper primary classes. Total coverage of 13.9 crore children; Education allocation increased by 20%
2008-09 should be a year of consolidation; We can do better to achieve inclusive growth; The government will manage capital inflows along with RBI;
Total agricultural output 219.32 million tonne. Agriculture growth rate at 2.6% in 2007-08
Wednesday, February 27, 2008
Tender deadline for fighters extended
The government on Wednesday extended by eight weeks the deadline for opening bids for the multibillion-dollar tender for purchasing 126 fighter aircraft.
No reason was given for the decision, though the Indian Air Force is facing a serious depletion of its force levels. The selection process for the deal is largely in the hands of the civilian bureaucracy.
The original deadline was March 3. Some sources suggested that it was extended at the urging of some of the competitors.
Under the contract, estimated at Rs. 42,000 crore, India would buy 18 fighters in a readymade condition and assemble the remaining 108 domestically.
In contention
Six companies — Lockheed Martin and Boeing (both from the U.S.), Gripen from Sweden, Rafale from Dassault, Eurofighter of the EADS and Russian MiG MAPO — are in contention.
No reason was given for the decision, though the Indian Air Force is facing a serious depletion of its force levels. The selection process for the deal is largely in the hands of the civilian bureaucracy.
The original deadline was March 3. Some sources suggested that it was extended at the urging of some of the competitors.
Under the contract, estimated at Rs. 42,000 crore, India would buy 18 fighters in a readymade condition and assemble the remaining 108 domestically.
In contention
Six companies — Lockheed Martin and Boeing (both from the U.S.), Gripen from Sweden, Rafale from Dassault, Eurofighter of the EADS and Russian MiG MAPO — are in contention.
Bharti, 5 firms to lay $300 mn undersea cable
Bharti Airtel is joining five other leading telecom companies to build a high-bandwidth, undersea, fibre-optic cable linking Asia and the US, with an estimated cost of $300 million (Rs 1,200 crore). The new cable, Unity, will carry data and internet traffic between Asia and the US.
Global Transit (Malaysia), Google (the US), KDDI Corporation (Japan), Pacnet (Singapore) and SingTel (Singapore) are the other members of the consortium.
The consortium has selected NEC Corporation and Tyco Telecommunications to construct and install the system. The construction of the cable system would begin immediately, while initial capacity would be available in the first quarter of 2010, said Bharti Airtel today in a release.
Global Transit (Malaysia), Google (the US), KDDI Corporation (Japan), Pacnet (Singapore) and SingTel (Singapore) are the other members of the consortium.
The consortium has selected NEC Corporation and Tyco Telecommunications to construct and install the system. The construction of the cable system would begin immediately, while initial capacity would be available in the first quarter of 2010, said Bharti Airtel today in a release.
Govt starts issuing new telecom licences
The government today started issuing telecom licences to new players beginning with Videocon-controlled Datacom Solutions.
A total of 22 licences would be given today to three new players, including permits for 19 circles to Datacom, according to senior officials in the department of telecommunications (DoT).
Birla's Idea Cellular would get the licence for one circle in Punjab and Swan Telecom for the Delhi and Mumbai circles.
A total of 120 licences would be distributed among nine companies including Unitech, Spice, Shyam Telelink and others that were issued letter of intent on January 10.
Asked when the exercise would be completed, officials said all agreements with the nine companies would be inked by the weekend.
A total of 22 licences would be given today to three new players, including permits for 19 circles to Datacom, according to senior officials in the department of telecommunications (DoT).
Birla's Idea Cellular would get the licence for one circle in Punjab and Swan Telecom for the Delhi and Mumbai circles.
A total of 120 licences would be distributed among nine companies including Unitech, Spice, Shyam Telelink and others that were issued letter of intent on January 10.
Asked when the exercise would be completed, officials said all agreements with the nine companies would be inked by the weekend.
Monday, February 25, 2008
World`s largest hedge fund firm now in India
Renaissance Technologies, the world’s largest hedge fund firm handling assets worth $35.4 billion (Rs 1,41,600 crore), has received approval from the Securities and Exchange Board of India (Sebi) to operate in the Indian stock markets as a foreign institutional investor.
Renaissance is the latest — and the biggest — among several hedge fund players that entered India following a liberal approach taken by the Indian regulator on hedge fund participation in the booming Indian stock market.
Others that recently entered include Vikram Pandit-founded Old Lane, DE Shaw (the world’s fifth-largest hedge fund with $29 billion or Rs 1,16,000 crore worth assets) and Och-Ziff Capital Management (the seventh largest with $28.6 billion or Rs 1,14,400 crore in assets), according to the Sebi website.
Renaissance, founded by 69-year-old Jim Simons, is based out of Manhattan, the US, and is perhaps the most interesting hedge fund. It has more than 260 employees — many of them are PhDs and not conventional analysts from management schools.
The hedge fund major’s Medallion Fund uses trading algorithms to invest across the world markets.
It returned more than 50 per cent in the first three quarters of 2007, according to a Bloomberg report. It had about $6 billion (Rs 24,000 crore) in assets as of July 1.
Renaissance’s returns stand out as the turmoil in the US credit markets and the meltdown in stock prices across the world took a knock on many hedge funds. Bear Stearns, for instance, saw two of its mortgage-related hedge funds falling into bankruptcy.
Renaissance is the latest — and the biggest — among several hedge fund players that entered India following a liberal approach taken by the Indian regulator on hedge fund participation in the booming Indian stock market.
Others that recently entered include Vikram Pandit-founded Old Lane, DE Shaw (the world’s fifth-largest hedge fund with $29 billion or Rs 1,16,000 crore worth assets) and Och-Ziff Capital Management (the seventh largest with $28.6 billion or Rs 1,14,400 crore in assets), according to the Sebi website.
Renaissance, founded by 69-year-old Jim Simons, is based out of Manhattan, the US, and is perhaps the most interesting hedge fund. It has more than 260 employees — many of them are PhDs and not conventional analysts from management schools.
The hedge fund major’s Medallion Fund uses trading algorithms to invest across the world markets.
It returned more than 50 per cent in the first three quarters of 2007, according to a Bloomberg report. It had about $6 billion (Rs 24,000 crore) in assets as of July 1.
Renaissance’s returns stand out as the turmoil in the US credit markets and the meltdown in stock prices across the world took a knock on many hedge funds. Bear Stearns, for instance, saw two of its mortgage-related hedge funds falling into bankruptcy.
ovt scraps 8 Goa SEZs
As many as eight Special Economic Zones (SEZs) proposals in Goa were scrapped at one stroke by the inter-ministerial Board of Approvals, which met here today. The Board also decided to ask 12 developers in the state why their zones should not be cancelled.
This is the first incident of a reversal of a Central policy, following a strong anti-SEZ movement in Goa last year that had threatened to bring down the Digambar Kamat-led Congress government.
SEZs are underwritten by a central law passed by Parliament in 2005 that permits special taxation and other fiscal benefits to the developers and the units inside these zones.
The Goa government, on December 31, 2007, had recommended that the Centre scrap all the zones in the state following widespread public protests. Anti-SEZ protesters had argued that the zones will put extra pressure on the already fragile infrastructure in the state and lead to a dilution of the Goan identity.
Their argument was that “outsiders” would flood Goa in search of SEZ jobs that the locals will not be able to fill. This cancellation is the first time in history that ethnic issues have led to reversal of central industrial policy.
Formally approved zones that are facing withdrawal of status include Inox Mercantile Company’s 48-hectare Biotech zone in Verna, Panchbhoomi Infrastructure Pvt Ltd’s 18.5-hectare infotech zone in North Goa and a 48-hectare Infotech zone of Paradigm Logistics in Verna.
“We are following the principle of natural justice and are sending showcause notices to 12 formally approved zones. Proposals that were sent by the state and were yet to be considered by the Board of Approvals will be treated as withdrawn,” said Commerce Secretary Gopal Krishna Pillai, who heads the board.
Three controversial SEZs in Goa — Cipla’s Meditab Specialities, Raheja’s IT/ITeS SEZ and Peninsula Pharma’s bio-tech SEZ — which were formally notified were, however, given a temporary reprieve, as the board decided to launch formal talks with the Goa government on the issue. The Goa government has been insistent on their denotification and scrapping.
The commerce ministry believes scrapping zones will send a wrong signal to foreign investors. The ministry argues that even in the case of denotification of the three zones, the industrial units built by the developers will continue to exist.
Sources said that Cipla had already invested more than Rs 200 crore in building two units at the Meditab zone.
Initially, the commerce ministry was of the view that notified zones could not be de-notified. But Commerce Minister Kamal Nath had subsequently said that denotification was an option that could be exercised. The matter was then referred to the law ministry.
Sources said issues relating to compensation to SEZ developers, as they have already pumped in money to set up industrial infrastructure, will have to be addressed.
The commerce ministry is hopeful that even if 20 SEZs in the state are axed, the three notified SEZs would continue to function.
Former minister Mathany Saldhana, who is leading the anti-SEZ agitation, said: “We consider today’s development a partial victory, but nevertheless the first major step in saving our state that could have lost its cultural heritage against the tide of the migrants coming in for jobs. It would also have ruined Goa’s environment. However, we vow not to rest till the three SEZs that have been notified are completely withdrawn by the government”.
The Board of Approval today also gave formal approval to 10 zones, and in-principle approval to 14 other zones spread across the country
This is the first incident of a reversal of a Central policy, following a strong anti-SEZ movement in Goa last year that had threatened to bring down the Digambar Kamat-led Congress government.
SEZs are underwritten by a central law passed by Parliament in 2005 that permits special taxation and other fiscal benefits to the developers and the units inside these zones.
The Goa government, on December 31, 2007, had recommended that the Centre scrap all the zones in the state following widespread public protests. Anti-SEZ protesters had argued that the zones will put extra pressure on the already fragile infrastructure in the state and lead to a dilution of the Goan identity.
Their argument was that “outsiders” would flood Goa in search of SEZ jobs that the locals will not be able to fill. This cancellation is the first time in history that ethnic issues have led to reversal of central industrial policy.
Formally approved zones that are facing withdrawal of status include Inox Mercantile Company’s 48-hectare Biotech zone in Verna, Panchbhoomi Infrastructure Pvt Ltd’s 18.5-hectare infotech zone in North Goa and a 48-hectare Infotech zone of Paradigm Logistics in Verna.
“We are following the principle of natural justice and are sending showcause notices to 12 formally approved zones. Proposals that were sent by the state and were yet to be considered by the Board of Approvals will be treated as withdrawn,” said Commerce Secretary Gopal Krishna Pillai, who heads the board.
Three controversial SEZs in Goa — Cipla’s Meditab Specialities, Raheja’s IT/ITeS SEZ and Peninsula Pharma’s bio-tech SEZ — which were formally notified were, however, given a temporary reprieve, as the board decided to launch formal talks with the Goa government on the issue. The Goa government has been insistent on their denotification and scrapping.
The commerce ministry believes scrapping zones will send a wrong signal to foreign investors. The ministry argues that even in the case of denotification of the three zones, the industrial units built by the developers will continue to exist.
Sources said that Cipla had already invested more than Rs 200 crore in building two units at the Meditab zone.
Initially, the commerce ministry was of the view that notified zones could not be de-notified. But Commerce Minister Kamal Nath had subsequently said that denotification was an option that could be exercised. The matter was then referred to the law ministry.
Sources said issues relating to compensation to SEZ developers, as they have already pumped in money to set up industrial infrastructure, will have to be addressed.
The commerce ministry is hopeful that even if 20 SEZs in the state are axed, the three notified SEZs would continue to function.
Former minister Mathany Saldhana, who is leading the anti-SEZ agitation, said: “We consider today’s development a partial victory, but nevertheless the first major step in saving our state that could have lost its cultural heritage against the tide of the migrants coming in for jobs. It would also have ruined Goa’s environment. However, we vow not to rest till the three SEZs that have been notified are completely withdrawn by the government”.
The Board of Approval today also gave formal approval to 10 zones, and in-principle approval to 14 other zones spread across the country
HDFC Bank, CBoP seal largest banking merger
HDFC Bank on Monday approved the acquisition of Centurion Bank of Punjab (CBoP) for Rs 9,510 crore in the largest merger in the financial sector in India. However, the merged entity would still be two-fifth the size of the country’s second largest lender, ICICI Bank.
CBoP shareholders will get one share of HDFC Bank for every 29 shares held by them.
The two banks did not comment on the price at which the shares were valued for the purpose of the swap ratio. The valuation arrived at is based on HDFC Bank’s closing share price of 1,474.95 last Friday and the total outstanding shares of CBoP.
HDFC Bank shares fell 3.54 per cent on the Bombay Stock Exchange on Monday to close at Rs 1,422.70 a share as investors felt the acquisition was a little costlier, while CBoP shares were down 14.45 per cent to Rs 48.25 a share as the price got aligned with the share-swap ratio.
The swap ratio was based on the recommendations made by joint valuers Dalal & Shah, a chartered accounting firm, and Ernst & Young, a consulting firm.
The merger will affect the performance parameters of the merged entity, which is compared to HDFC Bank now, as the productivity at CBoP was comparatively lower.
The boards of the two banks will meet again on February 28 to consider the draft scheme of amalgamation, which will be subject to regulatory approvals.
The HDFC Bank board will also consider making a preferential offer to its promoter, Housing Development Finance Corporation (HDFC), to enable it to maintain its shareholding in the merged entity.
HDFC held 23.28 per cent in HDFC Bank at the end of December 31, 2007. HDFC will need about Rs 3,900 crore to raise its shareholding after it falls to around 19 per cent after the merger.
CBoP’s Non-Executive Chairman Rana Talwar will be appointed the non-executive director of the merged entity, while its Managing Director and CEO Shailendra Bhandari will join the board as executive director.
Rana Talwar's Sabre Capital would hold less than 1 per cent stake in the merged entity from 3.48 in CBoP, while Bank Muscat's holding will decline to less than 4 per cent from over 14 per cent in CBoP.
CBoP shareholders will get one share of HDFC Bank for every 29 shares held by them.
The two banks did not comment on the price at which the shares were valued for the purpose of the swap ratio. The valuation arrived at is based on HDFC Bank’s closing share price of 1,474.95 last Friday and the total outstanding shares of CBoP.
HDFC Bank shares fell 3.54 per cent on the Bombay Stock Exchange on Monday to close at Rs 1,422.70 a share as investors felt the acquisition was a little costlier, while CBoP shares were down 14.45 per cent to Rs 48.25 a share as the price got aligned with the share-swap ratio.
The swap ratio was based on the recommendations made by joint valuers Dalal & Shah, a chartered accounting firm, and Ernst & Young, a consulting firm.
The merger will affect the performance parameters of the merged entity, which is compared to HDFC Bank now, as the productivity at CBoP was comparatively lower.
The boards of the two banks will meet again on February 28 to consider the draft scheme of amalgamation, which will be subject to regulatory approvals.
The HDFC Bank board will also consider making a preferential offer to its promoter, Housing Development Finance Corporation (HDFC), to enable it to maintain its shareholding in the merged entity.
HDFC held 23.28 per cent in HDFC Bank at the end of December 31, 2007. HDFC will need about Rs 3,900 crore to raise its shareholding after it falls to around 19 per cent after the merger.
CBoP’s Non-Executive Chairman Rana Talwar will be appointed the non-executive director of the merged entity, while its Managing Director and CEO Shailendra Bhandari will join the board as executive director.
Rana Talwar's Sabre Capital would hold less than 1 per cent stake in the merged entity from 3.48 in CBoP, while Bank Muscat's holding will decline to less than 4 per cent from over 14 per cent in CBoP.
BHEL gets Rs 1,075cr order from Gujarat
Power equipment supplier Bharat Heavy Electricals (BHEL) has bagged a Rs 1,075 crore order from Gujarat State Energy Generation.
The order for setting up a 350 Mw combined cycle power plant at Hazira in Gujarat, and is scheduled for completion in 27 months.
The order for setting up a 350 Mw combined cycle power plant at Hazira in Gujarat, and is scheduled for completion in 27 months.
Rail Budget:Vision 2025 in six months
Railway Minister Lalu Prasad today said Indian Railways will report a cash surplus of Rs 25,000cr in FY08.
Other highlights:
1. Rs 1,00,000cr investment via PPP.
2.Vision Statement - Railways 2025 - in six months.
3.Railways to upgrade 50 contiainer terminals across the country. Mumbai, Chandigarh terminal among the 50.
4.25-30 tonne axle load trains to be started.
5. SPVs to be formed for links to Mundra, Kandla and Krishnapatnam ports.
6. Railways to invest Rs 75,000 crore to upgrade infrastructure over the next seven years.
7. To set up 20,000km high density network.
8.Freight loading up by 8.2 per cent in the first 9 months of 2007-08.
9. Revenue from passengers fare increased 14% in 2007-08.
10. Planning bookings via mobiles
11. 30 big stations to have multi-level parking
12. 50 big stations to get lifts/escalators
13. New coaches in all Rajdhani Express trains from 2010.
14. To start making steel coaches from FY09 and introduce them from FY10.
15. No peak season surcharge on cement transport.
16. To provide on-board TV and Internet facility in passenger trains.
Other highlights:
1. Rs 1,00,000cr investment via PPP.
2.Vision Statement - Railways 2025 - in six months.
3.Railways to upgrade 50 contiainer terminals across the country. Mumbai, Chandigarh terminal among the 50.
4.25-30 tonne axle load trains to be started.
5. SPVs to be formed for links to Mundra, Kandla and Krishnapatnam ports.
6. Railways to invest Rs 75,000 crore to upgrade infrastructure over the next seven years.
7. To set up 20,000km high density network.
8.Freight loading up by 8.2 per cent in the first 9 months of 2007-08.
9. Revenue from passengers fare increased 14% in 2007-08.
10. Planning bookings via mobiles
11. 30 big stations to have multi-level parking
12. 50 big stations to get lifts/escalators
13. New coaches in all Rajdhani Express trains from 2010.
14. To start making steel coaches from FY09 and introduce them from FY10.
15. No peak season surcharge on cement transport.
16. To provide on-board TV and Internet facility in passenger trains.
Rafael, Tatas plan deal for defence systems
Rafael, the Israeli armaments company, is set to sign an agreement with Tata Power for maintenance of air defence systems which the company will supply to the Indian Air Force.
Rafael, which has got the contract for quick reaction surface-to-air Python and Derby Air Defence Systems for the Ministry of Defence, will sign the production transfer programme agreement with the Tata Group company this fiscal.
The missiles, that target low-flying enemy missions, will replace the IAF’s ageing Russian SAM-6 and SAM-7 missiles.
Rafael missiles will be used together with the indigenous Akash surface-to-air missiles which have recently been cleared for induction.
“Under the proposed agreement, Tata Power will manufacture some parts of the air defence systems and do the maintenance work post delivery,” Rafael’s director for air-to-air and air defence systems Oron Oriol said.
Each unit of the air defence systems consists of a command and control vehicle fitted with a radar, four silos capable of firing four missiles and units to supply and service the vehicle.
“This is a unique and advanced air defence system and India can make good use of it,” Oriol said. “We expect to sign the deal very soon, hopefully before March 31.”
The Cabinet committee on security last month cleared the deal, which will cost Rs 4,500 crore.
As part of the main contract to deliver the air defence systems to the IAF, Rafael will give an as yet unspecified number of Python-5 and Derby missiles, both of them considered advanced surface-to-air and air-to-air missiles.
The fifth generation surface-to-air and air-to-air Python-5 missile can be launched from very short to beyond-visual ranges. It has greater kill probability, excellent resistance to countermeasures, irrespective of evasive target manoeuvres, or deployment of countermeasures.
The Python-5’s unique full sphere performance is achieved by a combination of lock-on-after-launch and excellent acquisition and tracking capabilities.
Its dual waveband focal plane array seeker and sophisticated algorithms enable acquisition of even small, low signature targets in look-down, adverse background and cloudy environments.
Derby is an active radar surface-to-air and air-to-air missile. It’s operational flexibility and multi-shot capability enables use during the day or night and in all-weather conditions.
Together, the Python-5 and Derby offer superior fighting capabilities that ensure outstanding air superiority in 21st century warfare.
Rafael, which has got the contract for quick reaction surface-to-air Python and Derby Air Defence Systems for the Ministry of Defence, will sign the production transfer programme agreement with the Tata Group company this fiscal.
The missiles, that target low-flying enemy missions, will replace the IAF’s ageing Russian SAM-6 and SAM-7 missiles.
Rafael missiles will be used together with the indigenous Akash surface-to-air missiles which have recently been cleared for induction.
“Under the proposed agreement, Tata Power will manufacture some parts of the air defence systems and do the maintenance work post delivery,” Rafael’s director for air-to-air and air defence systems Oron Oriol said.
Each unit of the air defence systems consists of a command and control vehicle fitted with a radar, four silos capable of firing four missiles and units to supply and service the vehicle.
“This is a unique and advanced air defence system and India can make good use of it,” Oriol said. “We expect to sign the deal very soon, hopefully before March 31.”
The Cabinet committee on security last month cleared the deal, which will cost Rs 4,500 crore.
As part of the main contract to deliver the air defence systems to the IAF, Rafael will give an as yet unspecified number of Python-5 and Derby missiles, both of them considered advanced surface-to-air and air-to-air missiles.
The fifth generation surface-to-air and air-to-air Python-5 missile can be launched from very short to beyond-visual ranges. It has greater kill probability, excellent resistance to countermeasures, irrespective of evasive target manoeuvres, or deployment of countermeasures.
The Python-5’s unique full sphere performance is achieved by a combination of lock-on-after-launch and excellent acquisition and tracking capabilities.
Its dual waveband focal plane array seeker and sophisticated algorithms enable acquisition of even small, low signature targets in look-down, adverse background and cloudy environments.
Derby is an active radar surface-to-air and air-to-air missile. It’s operational flexibility and multi-shot capability enables use during the day or night and in all-weather conditions.
Together, the Python-5 and Derby offer superior fighting capabilities that ensure outstanding air superiority in 21st century warfare.
HDFC Bank, CBoP merger at 1:29
HDFC Bank today announced a ratio of 1:29 for the merger of Centurion Bank of Punjab (CBoP) with itself.
According to a release issued by HDFC Bank to the BSE today, based on the joint valuation report submitted by Ernst & Young and Dalal & Shah, the board today approved the share swap ratio of one equity share of Rs 10 each of HDFC Bank for 29 equity shares of Re 1 each of Centurion Bank of Punjab. The swap ratio is subject to due diligence to be conducted in this regard.
The bank's board observed that in the event of the merger being approved at its meeting on February 28, 2008, it would consider making a preferential offer to its promoter, Housing Development Finance Corporation (HDFC), to enable HDFC maintain its shareholding in the bank, the release added.
The combined entity would have a nationwide network of 1,148 branches (the largest amongst private sector banks), a deposit base of around Rs 1,20,000 crore and and net advances of around Rs 85,000 crore. The balance sheet size of the combined entity would be over Rs 1,50,000 crore.
Deepak Parekh, chairman, HDFC, said the merger is a "win-win" for both banks. He added that Shailendra Bhandari, CEO, Centurion Bank of Punjab, will now be executive director, HDFC Bank. Rana Talwar, a shareholder in Centurion Bank of Punjab, has been invited to join the board of HDFC Bank, Parekh added.
Aditya Puri, managing director, HDFC Bank said the merger is based on four premises - people, products, distribution and growth. "This is a merger that is fair, professional and clean," Puri said.
According to a release issued by HDFC Bank to the BSE today, based on the joint valuation report submitted by Ernst & Young and Dalal & Shah, the board today approved the share swap ratio of one equity share of Rs 10 each of HDFC Bank for 29 equity shares of Re 1 each of Centurion Bank of Punjab. The swap ratio is subject to due diligence to be conducted in this regard.
The bank's board observed that in the event of the merger being approved at its meeting on February 28, 2008, it would consider making a preferential offer to its promoter, Housing Development Finance Corporation (HDFC), to enable HDFC maintain its shareholding in the bank, the release added.
The combined entity would have a nationwide network of 1,148 branches (the largest amongst private sector banks), a deposit base of around Rs 1,20,000 crore and and net advances of around Rs 85,000 crore. The balance sheet size of the combined entity would be over Rs 1,50,000 crore.
Deepak Parekh, chairman, HDFC, said the merger is a "win-win" for both banks. He added that Shailendra Bhandari, CEO, Centurion Bank of Punjab, will now be executive director, HDFC Bank. Rana Talwar, a shareholder in Centurion Bank of Punjab, has been invited to join the board of HDFC Bank, Parekh added.
Aditya Puri, managing director, HDFC Bank said the merger is based on four premises - people, products, distribution and growth. "This is a merger that is fair, professional and clean," Puri said.
Honda inaugurates Noida plant
Honda Siel Cars India today inaugurated a new manufacturing facility at Greater Noida increasing its capacity from 50,000 to 100,000 units per annum.
Masahiro Takedagawa, chief executive, Honda Siel Cars India, said the capacity can be ramped up by 16,000 units in 2009.
The company has invested Rs 1,620 crore for the Greater Noida manufacturing facility.
Honda’s Civic hybrid will also roll out in a couple of months, a company official said. The company’s small car, a petrol version, will be launched in 2009.
Honda’s Rajasthan plant will be operational in the last quarter of 2009. It will ramp up its total capacity to 200,000-240,000 units in India. The company will initially invest Rs 1,000 crore in Rajasthan, which is likely to go up to Rs 3,000 crore.
Masahiro Takedagawa, chief executive, Honda Siel Cars India, said the capacity can be ramped up by 16,000 units in 2009.
The company has invested Rs 1,620 crore for the Greater Noida manufacturing facility.
Honda’s Civic hybrid will also roll out in a couple of months, a company official said. The company’s small car, a petrol version, will be launched in 2009.
Honda’s Rajasthan plant will be operational in the last quarter of 2009. It will ramp up its total capacity to 200,000-240,000 units in India. The company will initially invest Rs 1,000 crore in Rajasthan, which is likely to go up to Rs 3,000 crore.
Thursday, February 21, 2008
HDFC Bank to raise $1bn
Lender will offload medium-term notes, set up Bahrain branch.
HDFC Bank Ltd, India’s third-largest bank by market value, plans to sell as much as $1 billion of medium-term notes to finance its expansion overseas, said Sudhir Joshi, the bank’s treasurer.
HDFC aims to open its first branch abroad, in Bahrain, within a few months, Joshi said in a telephone interview from Mumbai today. The bank also plans to open new offices in London and Hong Kong, the company said.
HDFC Bank joins rivals such as ICICI Bank and Bank of Baroda in expanding overseas to track local companies including Tata Steel, Hindalco Industries and Indian Hotels, which are acquiring foreign competitors.
“As more local companies grow overseas and acquisitions rise, it makes sense for Indian banks to have a global presence,” said Navneet Munot, an executive director at Morgan Stanley Investment Management in Mumbai.
“Also, capital markets are getting integrated,” and businesses owned by Indians living overseas are increasing, Munot added.
Standard & Poor’s today gave a BBB- rating, its lowest investment grade, to the senior debt portion of the proposed notes. It assigned BB+, the highest non-investment grade rating, to the lower tier-2 subordinated debt and rated the upper tier-2 and hybrid tier-1 notes a step lower at BB. The bank hasn’t set the final structure of the debt, Joshi said.
ICICI Bank, the nation’s biggest, expects its overseas business to grow by a third in the next two years. The bank helped facilitate 11 overseas acquisition deals last year, according to data compiled by Bloomberg. The bank borrowed $10 billion overseas last year to fund clients’ overseas investment and acquisitions.
HDFC Bank’s 754 branches issued about half its Rs 71,400 crore ($17.8 billion) of outstanding loans to individual borrowers as of December 2007. The bank routes home mortgage loans on behalf of its promoter, Housing Development Finance Corporation, which owns a fifth of the commercial lender.
HDFC Bank Ltd, India’s third-largest bank by market value, plans to sell as much as $1 billion of medium-term notes to finance its expansion overseas, said Sudhir Joshi, the bank’s treasurer.
HDFC aims to open its first branch abroad, in Bahrain, within a few months, Joshi said in a telephone interview from Mumbai today. The bank also plans to open new offices in London and Hong Kong, the company said.
HDFC Bank joins rivals such as ICICI Bank and Bank of Baroda in expanding overseas to track local companies including Tata Steel, Hindalco Industries and Indian Hotels, which are acquiring foreign competitors.
“As more local companies grow overseas and acquisitions rise, it makes sense for Indian banks to have a global presence,” said Navneet Munot, an executive director at Morgan Stanley Investment Management in Mumbai.
“Also, capital markets are getting integrated,” and businesses owned by Indians living overseas are increasing, Munot added.
Standard & Poor’s today gave a BBB- rating, its lowest investment grade, to the senior debt portion of the proposed notes. It assigned BB+, the highest non-investment grade rating, to the lower tier-2 subordinated debt and rated the upper tier-2 and hybrid tier-1 notes a step lower at BB. The bank hasn’t set the final structure of the debt, Joshi said.
ICICI Bank, the nation’s biggest, expects its overseas business to grow by a third in the next two years. The bank helped facilitate 11 overseas acquisition deals last year, according to data compiled by Bloomberg. The bank borrowed $10 billion overseas last year to fund clients’ overseas investment and acquisitions.
HDFC Bank’s 754 branches issued about half its Rs 71,400 crore ($17.8 billion) of outstanding loans to individual borrowers as of December 2007. The bank routes home mortgage loans on behalf of its promoter, Housing Development Finance Corporation, which owns a fifth of the commercial lender.
Kalyani to have Rs 6,500-cr unit in Bengal
Integrated steel, power project will have capacity of 1 million tonne and 500 mw respectively.
Kalyani Steels, a part of the Rs 8,000 crore Kalyani group that has diverse businesses such as engineering steel, forgings and auto components, today signed a memorandum of understanding (MoU) with state industry and minerals officials for a Rs 6,500 crore integrated steel and power project in West Bengal.
BENGAL PRIZE
A detailed project report will be prepared within a year.
The project will be completed in 36-45 months.
This is the third steel project of the Kalyani group. The others are in Karnataka and Andhra Pradesh
The steel plant will have a capacity of one million tonnes and the power plant is planned for 500 mw, along with downstream operations.
The agreement was signed with the West Bengal Industrial Development Corporation (WBIDC) and West Bengal Mineral Development & Trading Corporation (WBMDTC).
Amit B Kalyani, executive director, Kalyani Steels, said that the plant would essentially produce long products. For the downstream project, Kalyani group’s flagship company Bharat Forge may look at setting up a unit.
Kalyani said the group deliberated with the Bengal investment issue for a year and a half, before reaching an understanding on the nature of the project.
A detailed project report would be ready within a year. “We will definitely work within a shorter timeframe,” Kalyani said.
The project will be completed within 36 to 45 months from the commencement of work.
The next step would be to identify land for the project.
West Bengal minister for commerce and industry, Nirupam Sen, said, the company would be shown land in West Medinipur, near Salboni where JSW has a mega steel plant. Durgapur could be an alternative location.
The Bengal facility will be the third for the Kalyanis. The group has integrated steel plants at Ginigera in Karnataka and Tadipatri in Andhra Pradesh.
The group also has bigger plans for West Bengal. Kalyani said the group is in discussions with WBIDC for a high-end manufacturing cluster.
The minister said several companies were looking to invest in West Bengal as they have realised that a lot of investment is happening in the metals, metallurgy and automobile space in the state.
He said a high-end manufacturing park would also be set up and the association with the Kalyani group would help the state government attract other investors.
The Kalyani group was already setting up a similar project, though larger in size, in Maharashtra. Kalyani said the Maharashtra project would be completed in three years.
Also, Kalyani Thermal Systems, another group company, will make forgings for the Nano, the Rs 1 lakh car from the Tatas that is being manufactured at Singur in West Bengal. The company could look at setting up a unit in the state.
Kalyani Steels, a part of the Rs 8,000 crore Kalyani group that has diverse businesses such as engineering steel, forgings and auto components, today signed a memorandum of understanding (MoU) with state industry and minerals officials for a Rs 6,500 crore integrated steel and power project in West Bengal.
BENGAL PRIZE
A detailed project report will be prepared within a year.
The project will be completed in 36-45 months.
This is the third steel project of the Kalyani group. The others are in Karnataka and Andhra Pradesh
The steel plant will have a capacity of one million tonnes and the power plant is planned for 500 mw, along with downstream operations.
The agreement was signed with the West Bengal Industrial Development Corporation (WBIDC) and West Bengal Mineral Development & Trading Corporation (WBMDTC).
Amit B Kalyani, executive director, Kalyani Steels, said that the plant would essentially produce long products. For the downstream project, Kalyani group’s flagship company Bharat Forge may look at setting up a unit.
Kalyani said the group deliberated with the Bengal investment issue for a year and a half, before reaching an understanding on the nature of the project.
A detailed project report would be ready within a year. “We will definitely work within a shorter timeframe,” Kalyani said.
The project will be completed within 36 to 45 months from the commencement of work.
The next step would be to identify land for the project.
West Bengal minister for commerce and industry, Nirupam Sen, said, the company would be shown land in West Medinipur, near Salboni where JSW has a mega steel plant. Durgapur could be an alternative location.
The Bengal facility will be the third for the Kalyanis. The group has integrated steel plants at Ginigera in Karnataka and Tadipatri in Andhra Pradesh.
The group also has bigger plans for West Bengal. Kalyani said the group is in discussions with WBIDC for a high-end manufacturing cluster.
The minister said several companies were looking to invest in West Bengal as they have realised that a lot of investment is happening in the metals, metallurgy and automobile space in the state.
He said a high-end manufacturing park would also be set up and the association with the Kalyani group would help the state government attract other investors.
The Kalyani group was already setting up a similar project, though larger in size, in Maharashtra. Kalyani said the Maharashtra project would be completed in three years.
Also, Kalyani Thermal Systems, another group company, will make forgings for the Nano, the Rs 1 lakh car from the Tatas that is being manufactured at Singur in West Bengal. The company could look at setting up a unit in the state.
India laggard in global patent filings
India has performed poorly in international patent filings last year compared to its neighbour China, according to data released by the Geneva-based World Intellectual Property Organisation (WIPO).
Filing patent applications under WIPO’s Patent Cooperation Treaty (PCT) enables companies to secure patent protection in various countries.
It is a measure for a knowledge-based economy and a barometer of the spread of innovation-based companies in each country.
In the global race for knowledge-based industries, WIPO’s data clearly suggest that India is far behind China.
India, for example, filed only 686 applications last year to secure patent protection in countries that are members of the PCT compared to 831 in 2006.
In the same period China’s patent applications grew 38.1 per cent to reach an all-time high 5,456. China’s impressive growth in its innovation-based companies enabled the Middle Kingdom to occupy seventh place in the world’s top 15 countries.
“We expect India to grow rapidly in life-sciences research, but at this juncture its considerable research and development activity has not translated into patent filings,’ said Francis Gurry, deputy-director general at WIPO overseeing the PCT work.
The stark differences between these two big economies are due to the underlying differences in their overall economic activity. While software and services dominate the Indian economy, new manufacturing activities are at the centre of the Chinese miracle, Gurry said.
Until now, the industrialised countries — the US, Germany, Japan, France, Britain, Netherlands, Switzerland, Sweden, Italy, Canada, Australia, Finland, and Israel — dominated the global rankings in the patent filings.
Although many of them continue to occupy leading positions, the emergence of Korea and China as two leading innovation-driven economies brought a change in the prevailing rankings.
Filing patent applications under WIPO’s Patent Cooperation Treaty (PCT) enables companies to secure patent protection in various countries.
It is a measure for a knowledge-based economy and a barometer of the spread of innovation-based companies in each country.
In the global race for knowledge-based industries, WIPO’s data clearly suggest that India is far behind China.
India, for example, filed only 686 applications last year to secure patent protection in countries that are members of the PCT compared to 831 in 2006.
In the same period China’s patent applications grew 38.1 per cent to reach an all-time high 5,456. China’s impressive growth in its innovation-based companies enabled the Middle Kingdom to occupy seventh place in the world’s top 15 countries.
“We expect India to grow rapidly in life-sciences research, but at this juncture its considerable research and development activity has not translated into patent filings,’ said Francis Gurry, deputy-director general at WIPO overseeing the PCT work.
The stark differences between these two big economies are due to the underlying differences in their overall economic activity. While software and services dominate the Indian economy, new manufacturing activities are at the centre of the Chinese miracle, Gurry said.
Until now, the industrialised countries — the US, Germany, Japan, France, Britain, Netherlands, Switzerland, Sweden, Italy, Canada, Australia, Finland, and Israel — dominated the global rankings in the patent filings.
Although many of them continue to occupy leading positions, the emergence of Korea and China as two leading innovation-driven economies brought a change in the prevailing rankings.
Tuesday, February 19, 2008
Paramount may order 15 aircraft worth $1 bn
Paramount Airways, the Coimbatore-based private airline, is in an advanced stages of negotiations with aircraft manufacturers Airbus and Boeing for a $1 billion order of 15 wide-bodied aircraft. The deal is likely to be announced shortly.
The deliveries of these aircraft are expected to take place between 2010 and 2014. The aircraft are likely to be financed by the Paramount Airways Group through funding from banks such as US Exim Bank.
“We are in the final stages of sealing the deal. There are some last-minute negotiations that are going on. If things work out, we are likely to place the order before the Singapore Airshow ends,” said M Thiagarajan, managing director, Paramount Airways.
He, however, refused to divulge whether the deal was going to be sealed with Boeing or Airbus, but he did confirm that the order would either be for Airbus 350s or 330s or Boeing 777 or 787. Paramount plans to fly on international routes by 2012.
“We would be using the aircraft for our international operations as and when we get the sanctions to fly abroad. We would be looking at destinations in Europe such as Vienna, Paris and also to the Far East to Hong Kong or Bangkok,” he added.
Paramount started operations in the South in 2005 and connects major commercial hubs to primary metros in the country. It is one of the leading airlines in the South with a 26 per cent market share.
It plans to have a pan-India presence and will be flying to Pune and Goa by April-end or early May. Currently, it operates only in south Indian destinations.
The airline operates new-generation Embraer 170/190 aircraft with an existing fleet of seven and plans to add another 40 by the end of 2010. This is when the airline wants to enter north India.
Paramount’s low-cost model has created a buzz because it is the first airline to offer full business-class service at prices equivalent to economy-class fares of other carriers.
The deliveries of these aircraft are expected to take place between 2010 and 2014. The aircraft are likely to be financed by the Paramount Airways Group through funding from banks such as US Exim Bank.
“We are in the final stages of sealing the deal. There are some last-minute negotiations that are going on. If things work out, we are likely to place the order before the Singapore Airshow ends,” said M Thiagarajan, managing director, Paramount Airways.
He, however, refused to divulge whether the deal was going to be sealed with Boeing or Airbus, but he did confirm that the order would either be for Airbus 350s or 330s or Boeing 777 or 787. Paramount plans to fly on international routes by 2012.
“We would be using the aircraft for our international operations as and when we get the sanctions to fly abroad. We would be looking at destinations in Europe such as Vienna, Paris and also to the Far East to Hong Kong or Bangkok,” he added.
Paramount started operations in the South in 2005 and connects major commercial hubs to primary metros in the country. It is one of the leading airlines in the South with a 26 per cent market share.
It plans to have a pan-India presence and will be flying to Pune and Goa by April-end or early May. Currently, it operates only in south Indian destinations.
The airline operates new-generation Embraer 170/190 aircraft with an existing fleet of seven and plans to add another 40 by the end of 2010. This is when the airline wants to enter north India.
Paramount’s low-cost model has created a buzz because it is the first airline to offer full business-class service at prices equivalent to economy-class fares of other carriers.
RBI rejects more equity exposure
Rejects proposals by Bank of India, IndusInd, Kotak Mahindra and HDFC.
The banking regulator has rejected proposals by four banks — Bank of India, IndusInd Bank, Kotak Mahindra Bank and HDFC Bank — to increase their capital market exposure beyond the regulatory cap of 40 per cent of net worth on grounds of excessive market volatility.
"None of the proposals were accepted, keeping in view the prudential regulatory considerations," the Reserve Bank of India (RBI) said in its recent submission to the Parliamentary standing committee on finance, a copy of which is available with Business Standard.
The RBI has the discretion to allow higher capital market exposure to banks with sound internal controls and robust risk management systems, but the banking regulator decided against exercising it.
CAPITAL GAINS
(Banks’ Capital Market Exposure (CME) at end November 2007)
Bank Total market
exposure
(Rs crore) Net worth
at end
Mar-07
(Rs crore) CME as
% of
net worth
Bank of India 1,664 5,702 29.19
HDFC Bank 4,541 6,433 70.58
IndusInd Bank 363 1,057 34.34
Kotak Mahindra 401 1,568 25.58
HDFC Bank had a capital market exposure of 70.58 per cent of its net worth at the end of November 2007. This was before the RBI changed the norms and capped the exposure at 40 per cent of net worth. The exposures of the other three banks were within the regulatory ceiling.
The private sector bank HDFC Bank had requested an increase in its exposure limit to 55 per cent of net worth. The RBI instead asked the bank to bring the capital market exposure down to 40 per cent by April 2008.
The regulations stipulate that the aggregate exposure (funded and non-funded) of banks to capital market in all forms should not exceed 40 per cent of the individual bank’s net worth at the end of previous financial year. The 40 per cent cap is applied to both on standalone and consolidated books of banks.
Within the overall exposure limit, banks' direct investment in shares, convertible bonds, capital bonds and debentures, and units of equity mutual fund schemes should not exceed 20 per cent of net worth.
Explaining its decision to turn down the banks' requests, RBI's submission to the Parliamentary standing committee said the Indian stock witnessed a sustained rally between May 2003 and the first week of January 2008 with intermittent corrections.
The uptrend was driven by heavy investments especially by foreign institutional investors (FIIs) on the back of robust macroeconomic growth, strong corporate earnings.
Beginning January 11, stock markets were generally bearish in line with the downward trend in major international equity markets amidst fears over recession in the US economy, the RBI's submission said.
The liquidity squeeze in the secondary market in the wake of large initial public offerings by some companies, weak global markets, heavy net sales by FIIs in the Indian equity market and fall in global metal prices were the main factors that dampened the market sentiment in the last week of January 2008, the central bank said.
The banking regulator has rejected proposals by four banks — Bank of India, IndusInd Bank, Kotak Mahindra Bank and HDFC Bank — to increase their capital market exposure beyond the regulatory cap of 40 per cent of net worth on grounds of excessive market volatility.
"None of the proposals were accepted, keeping in view the prudential regulatory considerations," the Reserve Bank of India (RBI) said in its recent submission to the Parliamentary standing committee on finance, a copy of which is available with Business Standard.
The RBI has the discretion to allow higher capital market exposure to banks with sound internal controls and robust risk management systems, but the banking regulator decided against exercising it.
CAPITAL GAINS
(Banks’ Capital Market Exposure (CME) at end November 2007)
Bank Total market
exposure
(Rs crore) Net worth
at end
Mar-07
(Rs crore) CME as
% of
net worth
Bank of India 1,664 5,702 29.19
HDFC Bank 4,541 6,433 70.58
IndusInd Bank 363 1,057 34.34
Kotak Mahindra 401 1,568 25.58
HDFC Bank had a capital market exposure of 70.58 per cent of its net worth at the end of November 2007. This was before the RBI changed the norms and capped the exposure at 40 per cent of net worth. The exposures of the other three banks were within the regulatory ceiling.
The private sector bank HDFC Bank had requested an increase in its exposure limit to 55 per cent of net worth. The RBI instead asked the bank to bring the capital market exposure down to 40 per cent by April 2008.
The regulations stipulate that the aggregate exposure (funded and non-funded) of banks to capital market in all forms should not exceed 40 per cent of the individual bank’s net worth at the end of previous financial year. The 40 per cent cap is applied to both on standalone and consolidated books of banks.
Within the overall exposure limit, banks' direct investment in shares, convertible bonds, capital bonds and debentures, and units of equity mutual fund schemes should not exceed 20 per cent of net worth.
Explaining its decision to turn down the banks' requests, RBI's submission to the Parliamentary standing committee said the Indian stock witnessed a sustained rally between May 2003 and the first week of January 2008 with intermittent corrections.
The uptrend was driven by heavy investments especially by foreign institutional investors (FIIs) on the back of robust macroeconomic growth, strong corporate earnings.
Beginning January 11, stock markets were generally bearish in line with the downward trend in major international equity markets amidst fears over recession in the US economy, the RBI's submission said.
The liquidity squeeze in the secondary market in the wake of large initial public offerings by some companies, weak global markets, heavy net sales by FIIs in the Indian equity market and fall in global metal prices were the main factors that dampened the market sentiment in the last week of January 2008, the central bank said.
R-Power bonus after payment of call money
Reliance Power today announced that the company will allot the proposed bonus shares only to investors who will make the balance payment before February 26.
According to a release issued by the company to the BSE today, the bonus shares of investors who do not pay the call money by the due date will be kept in abeyance.
According to a release issued by the company to the BSE today, the bonus shares of investors who do not pay the call money by the due date will be kept in abeyance.
Monday, February 18, 2008
ONGC lines up Rs 15,000cr revamp
Oil and Natural Gas Corporation (ONGC) will revamp its ageing infrastructure at oilfields across the country. The country's largest oil and gas production company will shell out around Rs 15,000 crore for this purpose.
The revamping will start with its assets in Assam. The company will soon float tenders worth Rs 2,500 crore, a senior company executive said. ONGC has three fields in Assam - Rudrasagar, Lakwa and Geleki. The Rudrasagar field is almost 40 years old.
"Replacing the equipment has become paramount as they are decades old. There are frequent leaks in pipelines from producing wells which lead to shutdowns," said the executive.
The crude oil and gas processing plant attached to the Lakwa field is also old. The unit trips if it is run for over five minutes. "Some gas that we can recover is thus lost," the executive added.
Once Assam Renewal Project is completed in three years, ONGC plans to increase oil production from these fields by 20 per cent.
The company produces around 26 million per year of crude oil from its fields in the country with around 1.1 million tonne per year of oil from its three fields in Assam. Earlier, production from Assam was 1.5 million tonne per year
The revamping will start with its assets in Assam. The company will soon float tenders worth Rs 2,500 crore, a senior company executive said. ONGC has three fields in Assam - Rudrasagar, Lakwa and Geleki. The Rudrasagar field is almost 40 years old.
"Replacing the equipment has become paramount as they are decades old. There are frequent leaks in pipelines from producing wells which lead to shutdowns," said the executive.
The crude oil and gas processing plant attached to the Lakwa field is also old. The unit trips if it is run for over five minutes. "Some gas that we can recover is thus lost," the executive added.
Once Assam Renewal Project is completed in three years, ONGC plans to increase oil production from these fields by 20 per cent.
The company produces around 26 million per year of crude oil from its fields in the country with around 1.1 million tonne per year of oil from its three fields in Assam. Earlier, production from Assam was 1.5 million tonne per year
Spectrum allocation delayed to year-end
Rollout plans of nine mobile telecom companies that received letters of intent from the government last month and the launch of 3G (third-generation) wireless services by others face major problems with spectrum allocation delayed from June to the year-end.
The principal delay is because the defence forces, which are expected to vacate some spectrum for mobile service providers, are yet to identify locations for some sites for an alternative optic fibre network that is being developed for them.
Of the 162 sites to be developed for the alternative network, only 50 have been completed.
The department of telecommunications (DoT) had assigned the execution of the network to Bharat Sanchar Nigam Ltd (BSNL), India’s largest telephony company, in April 2006. HCL Infosystems is one of the vendors for network equipment.
“It will still take another two to three quarters to complete the project,” said a source familiar with the development. Spectrum refers to the radio frequencies that enable wireless communication.
The defence services are expected to vacate 45 Mhz of wireless spectrum (of which 25 MhZ is for 3G) for mobile services once they shift a part of their communication needs from a wireless to a wireline network.
Sources said demonstrations for the 50 sites are on and they can be operational as early as mid-March. However, DoT has not yet clarified whether the spectrum to the new licence-holders will be given in a phased manner or in one go. Crucial meetings between the ministry of defence and DoT are slated this week on the issue.
However, companies like Unitech, Shyam-Sistema, BPL, Swan Telecom, Datacom might have no choice but to wait till next year before they are allocated their initial spectrum, which might impact the viability of their projects.
New players will take at least six to 12 months to roll out after spectrum is allocated.
Incumbents already control 272 million customers. In the next year they are expected to add 70 million to 100 million new customers taking their total number of subscribers to between 340 million and 370 million.
By 2012, when the new players optimistically expect to be up and running, India’s mobile market is estimated at 600 million. This means the new licensees plus CDMA incumbents Reliance Communications and Tata Teleservices that have been allowed to offer GSM services will be fighting for 200 million-odd customers.
The auction of 3G licences is also dependent on DoT being able to resolve the spectrum imbroglio with the ministry of defence.
The principal delay is because the defence forces, which are expected to vacate some spectrum for mobile service providers, are yet to identify locations for some sites for an alternative optic fibre network that is being developed for them.
Of the 162 sites to be developed for the alternative network, only 50 have been completed.
The department of telecommunications (DoT) had assigned the execution of the network to Bharat Sanchar Nigam Ltd (BSNL), India’s largest telephony company, in April 2006. HCL Infosystems is one of the vendors for network equipment.
“It will still take another two to three quarters to complete the project,” said a source familiar with the development. Spectrum refers to the radio frequencies that enable wireless communication.
The defence services are expected to vacate 45 Mhz of wireless spectrum (of which 25 MhZ is for 3G) for mobile services once they shift a part of their communication needs from a wireless to a wireline network.
Sources said demonstrations for the 50 sites are on and they can be operational as early as mid-March. However, DoT has not yet clarified whether the spectrum to the new licence-holders will be given in a phased manner or in one go. Crucial meetings between the ministry of defence and DoT are slated this week on the issue.
However, companies like Unitech, Shyam-Sistema, BPL, Swan Telecom, Datacom might have no choice but to wait till next year before they are allocated their initial spectrum, which might impact the viability of their projects.
New players will take at least six to 12 months to roll out after spectrum is allocated.
Incumbents already control 272 million customers. In the next year they are expected to add 70 million to 100 million new customers taking their total number of subscribers to between 340 million and 370 million.
By 2012, when the new players optimistically expect to be up and running, India’s mobile market is estimated at 600 million. This means the new licensees plus CDMA incumbents Reliance Communications and Tata Teleservices that have been allowed to offer GSM services will be fighting for 200 million-odd customers.
The auction of 3G licences is also dependent on DoT being able to resolve the spectrum imbroglio with the ministry of defence.
L&T wins Rs 1,250cr order from ONGC
Larsen & Toubro (L&T) has won a Rs 1,250 crore turnkey project from Oil & Natural Gas Corporation (ONGC).
According to a release issued by L&T to the BSE today, the company will have single-point responsibility for the complete engineering, procurement, fabrication & installation of the offshore platforms.
'The project comprises building three smart well platforms, sub-sea interconnecting pipelines, sub-sea cables and topside modifications for the Mumbai High South field. It will involve 15,000 tonne of topside and jackets, 58 km sub-sea pipelines & 22 km sub-sea cables in addition to many state-of-the-art facilities. It is to be completed by April 2009," the release added.
L&T will carry out the engineering design at their subsidiary L&T Valdel in Bangalore, and fabrication will be carried out at L&T's world-class shore-based manufacturing complex at Hazira near Surat as well as at the company's modern large fabrication facility at Sohar in Oman.
According to a release issued by L&T to the BSE today, the company will have single-point responsibility for the complete engineering, procurement, fabrication & installation of the offshore platforms.
'The project comprises building three smart well platforms, sub-sea interconnecting pipelines, sub-sea cables and topside modifications for the Mumbai High South field. It will involve 15,000 tonne of topside and jackets, 58 km sub-sea pipelines & 22 km sub-sea cables in addition to many state-of-the-art facilities. It is to be completed by April 2009," the release added.
L&T will carry out the engineering design at their subsidiary L&T Valdel in Bangalore, and fabrication will be carried out at L&T's world-class shore-based manufacturing complex at Hazira near Surat as well as at the company's modern large fabrication facility at Sohar in Oman.
Disney to hike stake in UTV, invest Rs 805cr
Disney increases stake in UTV to 32.1% with an investment of approximately Rs 805 crore ($203 million)
* Ronnie Screwvala consolidates stake at 32.1% with warrants at the same price
* Disney takes 15% of UTV Global Broadcasting for Rs 119 crore ($30 million)
The board of directors of UTV Software Communications, which met on February 16, approved a proposal to issue 9.35 million equity shares to The Walt Disney Company (Southeast Asia) at Rs 860.79 per share.
According to a release issued by UTV to the BSE today, Disney will invest Rs 805 crore to hike its stake from 14.85% (by holding 3.40 million shares).
The deal is subject to the approval of shareholders and all regulatory approvals "including but not limited to the approval of the Foreign Investment Promotion Board for the subscription of equity shares by Disney in the company,"the release added.
* Ronnie Screwvala consolidates stake at 32.1% with warrants at the same price
* Disney takes 15% of UTV Global Broadcasting for Rs 119 crore ($30 million)
The board of directors of UTV Software Communications, which met on February 16, approved a proposal to issue 9.35 million equity shares to The Walt Disney Company (Southeast Asia) at Rs 860.79 per share.
According to a release issued by UTV to the BSE today, Disney will invest Rs 805 crore to hike its stake from 14.85% (by holding 3.40 million shares).
The deal is subject to the approval of shareholders and all regulatory approvals "including but not limited to the approval of the Foreign Investment Promotion Board for the subscription of equity shares by Disney in the company,"the release added.
Mahindra Defence in talks with Italian firm
Mahindra Defence Systems (MDS), a part of the Mahindra & Mahindra Group, is in advanced negotiations for a strategic alliance with Whitehead Alenia Sistemi Subacquei (WASS), the maritime underwater systems subsidiary of the $12 billion Finmeccanica Group of Italy.
"The Mahindra Group has a long and illustrious relationship with the defence sector, which dates back to the time we began assembling jeeps in India. Our association has only strengthened over the years with the inception of MDS, which has emerged as one of the foremost suppliers of light combat/armoured vehicles and their derivatives for defence/ security forces in the country. We are also looking at strategic partnerships with experienced players in the field, which will help us enhance our product offerings for the defence sector," said Anand Mahindra, vice chairman and managing director, Mahindra Group.
The proposed joint venture with WASS will enable MDS to enhance product range by utilising the industrial and operational capabilities of Mahindra & Mahindra. The Finmeccanica Group has supplied lightweight torpedoes and submarine fired decoys to the armed forces.
"The proposed underwater defence JV with WASS will jointly address the Indian requirement for underwater defence bringing to the country's armed forces affordable world-class underwater defence systems. The range of MDS products displayed at the DefExpo underscores our competencies in land and naval systems, military communications and system integration. MDS is the country's leading provider of up-armoured and bullet proof vehicles with more than 500 Rakshaks and up-armoured Scorpios in service in the Indian Army and security / police forces. These vehicles have proved themselves repeatedly in operations, and have developed a formidable reputation by saving the lives of our armed forces personnel," said Brigadier Khutub Hai, chief executive, Mahindra Defence Systems.
"The Mahindra Group has a long and illustrious relationship with the defence sector, which dates back to the time we began assembling jeeps in India. Our association has only strengthened over the years with the inception of MDS, which has emerged as one of the foremost suppliers of light combat/armoured vehicles and their derivatives for defence/ security forces in the country. We are also looking at strategic partnerships with experienced players in the field, which will help us enhance our product offerings for the defence sector," said Anand Mahindra, vice chairman and managing director, Mahindra Group.
The proposed joint venture with WASS will enable MDS to enhance product range by utilising the industrial and operational capabilities of Mahindra & Mahindra. The Finmeccanica Group has supplied lightweight torpedoes and submarine fired decoys to the armed forces.
"The proposed underwater defence JV with WASS will jointly address the Indian requirement for underwater defence bringing to the country's armed forces affordable world-class underwater defence systems. The range of MDS products displayed at the DefExpo underscores our competencies in land and naval systems, military communications and system integration. MDS is the country's leading provider of up-armoured and bullet proof vehicles with more than 500 Rakshaks and up-armoured Scorpios in service in the Indian Army and security / police forces. These vehicles have proved themselves repeatedly in operations, and have developed a formidable reputation by saving the lives of our armed forces personnel," said Brigadier Khutub Hai, chief executive, Mahindra Defence Systems.
Tatas, Israel Aerospace tie up for missiles
JV will also help other firms develop technology as suppliers.
Tata Advanced Systems and Israel Aerospace Industries (IAI), Israel’s largest defence and aerospace company, agreed to establish a joint venture to make missiles, pilotless drones, electronic warfare systems and other defence equipment.
Ratan Tata, chairman, Tata Sons, and and Itzhak Nissan, president and chief executive officer of state-owned IAI, today signed a memorandum of understanding forming the joint venture, on the sidelines of the DefExpo 2008 in New Delhi. The JV will also help other Indian companies to develop technology as suppliers to IAI.
“We believe that the coming together of Tatas and IAI will positively impact the growth of the defence industry in India and complement the efforts of our Defence labs, Ordnance factory board and defence public sector undertakings,” Ratan Tata said.
“The new IAI-TATA JV reflects our commitment to deepen our relations with Indian industry,” said Itzhak Nissan.
“Together, we will be able to offer a wide range of defence products and to boost the capabilities of local Indian defence industries.”
This joint venture is the fourth major defence deal within a week for Tata Advanced Systems, the wholly owned subsidiary of Tata Industries which is focused on defence and aerospace solutions.
On Saturday, the company announced a tie-up with European Defence and Aerospace Consortium to bid for the $1 billion advanced tactical communications system project of the Indian Army.
On Friday, the company teamed up with US-based Sikorsky Aircraft Corporation to make cabins for Sikorsky’s S-92 helicopters and announced a joint venture with Boeing for defence-related aerospace components work in India.
Reliance Power plans bonus shares issue
Reliance Power Ltd, headed by Anil Ambani, on Sunday decided to consider issue of bonus shares to all categories of investors, excluding the promoters group. The decision will be taken at a meeting of its Board of Directors on February 24.
The company was listed on stock exchanges only on February 11. Reliance Power’s Initial Public Offering — which was offered for retail investors at Rs.430 a share and institutional investors at Rs.450 a share — closed on January 18.
The company was listed on stock exchanges only on February 11. Reliance Power’s Initial Public Offering — which was offered for retail investors at Rs.430 a share and institutional investors at Rs.450 a share — closed on January 18.
Friday, February 15, 2008
Tatas to make helicopter cabins for Sikorsky
In yet another milestone in its defence sector entry, the Tatas today announced a tie-up with helicopter maker Sikorsky Aircraft Corporation to manufacture chopper cabins in India.
SKY IS THE LIMIT
Sikorsky, the US-based helicopter design, manufacturing and services company, has signed an MoU with Tata Advanced Systems
TAS, a wholly owned subsidiary of Tata Industries, provides integrated solutions for the defence and aerospace sectors
US-based Sikorsky, a helicopter design, manufacturing and services company, signed a memorandum of understanding with Tata Advanced Systems (TAS) for the former’s first dedicated civil and rescue helicopter in India, the S-92. The financial details of the agreement were not disclosed.
TAS, a wholly owned subsidiary of Tata Industries, provides integrated solutions for the defence and aerospace sectors.
The manufacturing facility for the S-92 helicopter cabins, according to TAS, will offer productivity gains to Sikorsky while bringing new technology to India. “This initiative forms an important part of the larger strategy for this sector,” TAS said.
“India represents an expansive rotorcraft market with enormous potential and opportunity,” Sikorsky President Jeffrey Pino said in a statement.
Sikorsky has been involved in manufacturing advanced military helicopters since 1943. Its products include the battle proven Black Hawk and Naval Hawk models of helicopters.
It recently did a test-flight for the advanced multi-flight, fly-by-fire technology-enabled H-92, military variant of the S-92 chopper.
The announcement comes a day after Tata Industries and Boeing Company announced their decision to form a joint venture company that will initially have over $500 million of defence-related aerospace component work in India for export to Boeing and its global customers.
This is also the third major announcement by the Tata group this month involving aerospace parts manufacturing.
The revenues from the defence sector for the Tata group have doubled since 2004 and it has set itself a target of more than Rs 2,200 crore by 2008.
SKY IS THE LIMIT
Sikorsky, the US-based helicopter design, manufacturing and services company, has signed an MoU with Tata Advanced Systems
TAS, a wholly owned subsidiary of Tata Industries, provides integrated solutions for the defence and aerospace sectors
US-based Sikorsky, a helicopter design, manufacturing and services company, signed a memorandum of understanding with Tata Advanced Systems (TAS) for the former’s first dedicated civil and rescue helicopter in India, the S-92. The financial details of the agreement were not disclosed.
TAS, a wholly owned subsidiary of Tata Industries, provides integrated solutions for the defence and aerospace sectors.
The manufacturing facility for the S-92 helicopter cabins, according to TAS, will offer productivity gains to Sikorsky while bringing new technology to India. “This initiative forms an important part of the larger strategy for this sector,” TAS said.
“India represents an expansive rotorcraft market with enormous potential and opportunity,” Sikorsky President Jeffrey Pino said in a statement.
Sikorsky has been involved in manufacturing advanced military helicopters since 1943. Its products include the battle proven Black Hawk and Naval Hawk models of helicopters.
It recently did a test-flight for the advanced multi-flight, fly-by-fire technology-enabled H-92, military variant of the S-92 chopper.
The announcement comes a day after Tata Industries and Boeing Company announced their decision to form a joint venture company that will initially have over $500 million of defence-related aerospace component work in India for export to Boeing and its global customers.
This is also the third major announcement by the Tata group this month involving aerospace parts manufacturing.
The revenues from the defence sector for the Tata group have doubled since 2004 and it has set itself a target of more than Rs 2,200 crore by 2008.
Tata Advanced Systems signs deal with US firm
US-based Sikorsky Aircraft Corporation today announced the signing of a memorandum of understanding with Tata Advanced Systems to manufacture S-92 helicopter cabins in India.
Sikorsky is a subsidiary of United Technologies Corporation, and Tata Advanced Systems is a wholly-owned subsidiary of Tata Industries.
"India represents an expansive rotorcraft market with enormous potential and opportunity," said Jeffrey P. Pino, president, Sikorsky. "While we are only in the most preliminary stage, I am excited at the possibility of working with the well-known and admired Tata Group, and tapping into India ’s skilled aerospace industry and capability."
Tata Industries believes that this manufacturing facility for the S-92 helicopter cabin will offer productivity gains to Sikorsky while bringing new manufacturing technology to India.
Sikorsky is a subsidiary of United Technologies Corporation, and Tata Advanced Systems is a wholly-owned subsidiary of Tata Industries.
"India represents an expansive rotorcraft market with enormous potential and opportunity," said Jeffrey P. Pino, president, Sikorsky. "While we are only in the most preliminary stage, I am excited at the possibility of working with the well-known and admired Tata Group, and tapping into India ’s skilled aerospace industry and capability."
Tata Industries believes that this manufacturing facility for the S-92 helicopter cabin will offer productivity gains to Sikorsky while bringing new manufacturing technology to India.
Boeing, Tata form India JV for aerospace parts
The company will be established by June.
Tata Industries Limited and Boeing Company, the Pentagon’s second-largest supplier, have agreed to form a joint venture company to supply more than $500 million worth of defence-related aerospace component parts to the US company.
According to a media release, the JV company will be established by June and will soon begin building Boeing aerospace components.
This is the second big deal involving the two companies in the recent past. The last was an agreement with TAL Manufacturing Solutions Ltd, a wholly owned subsidiary of Tata Motors, for manufacturing floor beams for Boeing’s 787 Dreamliner airplane programme.
The current agreement intends to utilise not only the existing Tata manufacturing capability, but also to develop new supply sources throughout the Indian manufacturing and engineering communities for both commercial and defence applications.
“This JV between Tata and Boeing is an important part of our strategy to build capabilities in defence and aerospace,” said Tata Group Chairman Ratan Tata. “I look forward to the joint venture becoming a world-class facility in India.”
Manufacturing capabilities established within the JV company would in later phases be leveraged across multiple Boeing programs, including the Medium Multi-Role Combat Aircraft (MMRCA) competition.
The agreement to be executed in a phased manner will potentially issue contracts for work packages to the JV company involving defence-related component manufacturing on Boeing’s F/A-18 Super Hornet for the US Navy and Royal Australian Air Force, CH-47 Chinook and/or P-8 Maritime Patrol Aircraft in the first phase.
Prospect of establishing a research and development center for advanced manufacturing technologies later is also being looked into.
Boeing, Lockheed Martin Corp and other overseas defence contractors are partnering with Indian companies ahead of their bids for India’s $11 billion of fighter jets, the biggest order for combat planes in 15 years.
The winner of the deal must order at least 50 per cent of defence component purchases from India.
Tata Industries Limited and Boeing Company, the Pentagon’s second-largest supplier, have agreed to form a joint venture company to supply more than $500 million worth of defence-related aerospace component parts to the US company.
According to a media release, the JV company will be established by June and will soon begin building Boeing aerospace components.
This is the second big deal involving the two companies in the recent past. The last was an agreement with TAL Manufacturing Solutions Ltd, a wholly owned subsidiary of Tata Motors, for manufacturing floor beams for Boeing’s 787 Dreamliner airplane programme.
The current agreement intends to utilise not only the existing Tata manufacturing capability, but also to develop new supply sources throughout the Indian manufacturing and engineering communities for both commercial and defence applications.
“This JV between Tata and Boeing is an important part of our strategy to build capabilities in defence and aerospace,” said Tata Group Chairman Ratan Tata. “I look forward to the joint venture becoming a world-class facility in India.”
Manufacturing capabilities established within the JV company would in later phases be leveraged across multiple Boeing programs, including the Medium Multi-Role Combat Aircraft (MMRCA) competition.
The agreement to be executed in a phased manner will potentially issue contracts for work packages to the JV company involving defence-related component manufacturing on Boeing’s F/A-18 Super Hornet for the US Navy and Royal Australian Air Force, CH-47 Chinook and/or P-8 Maritime Patrol Aircraft in the first phase.
Prospect of establishing a research and development center for advanced manufacturing technologies later is also being looked into.
Boeing, Lockheed Martin Corp and other overseas defence contractors are partnering with Indian companies ahead of their bids for India’s $11 billion of fighter jets, the biggest order for combat planes in 15 years.
The winner of the deal must order at least 50 per cent of defence component purchases from India.
Tata Advanced Systems signs deal with US firm
US-based Sikorsky Aircraft Corporation today announced the signing of a memorandum of understanding with Tata Advanced Systems to manufacture S-92 helicopter cabins in India.
Sikorsky is a subsidiary of United Technologies Corporation, and Tata Advanced Systems is a wholly-owned subsidiary of Tata Industries.
"India represents an expansive rotorcraft market with enormous potential and opportunity," said Jeffrey P. Pino, president, Sikorsky. "While we are only in the most preliminary stage, I am excited at the possibility of working with the well-known and admired Tata Group, and tapping into India ’s skilled aerospace industry and capability."
Tata Industries believes that this manufacturing facility for the S-92 helicopter cabin will offer productivity gains to Sikorsky while bringing new manufacturing technology to India.
Sikorsky is a subsidiary of United Technologies Corporation, and Tata Advanced Systems is a wholly-owned subsidiary of Tata Industries.
"India represents an expansive rotorcraft market with enormous potential and opportunity," said Jeffrey P. Pino, president, Sikorsky. "While we are only in the most preliminary stage, I am excited at the possibility of working with the well-known and admired Tata Group, and tapping into India ’s skilled aerospace industry and capability."
Tata Industries believes that this manufacturing facility for the S-92 helicopter cabin will offer productivity gains to Sikorsky while bringing new manufacturing technology to India.
Manmohan Singh confident of 9 per cent growth this year
Prime Minister Dr. Manmohan Singh today exuded confidence that the domestic economy will grow at 9 per cent this year and inflation can be contained at an acceptable level.
Addressing the annual session of the Federation of Indian Chambers of Commerce and Industry (FICCI), Dr. Singh said that our economy is mainly driven by domestic factors, particularly improved investment, demand and consumption.
"On one hand, our economy is sticking along smoothly having registered a growth rate of 9.6 per cent last year and likely to touch almost 9 percent this year. On the other hand, there are clouds on the horizon with distinct possibilities of the global economy, particularly the developed world facing a downturn in the coming year to some extent," he added.
Highlighting the strong fundamentals of the economy, Dr. Singh said that the savings rate in the country has touched almost 35 per cent of Gross Domestic Product (GDP) and the investment rate is at an all time peak of over 36 per cent of the GDP.
Dr. Singh said that the capital formation in both public and private sector is touching new peaks and the inward Foreign Direct Investment (FDI) had crossed 20 billion dollars last year.
While acknowledging the major role of domestic factors in the country's growth story, he admitted that the economy might react to the slowdown elsewhere in the world but assured the investors saying that government would take steps to limit their impact.
To help step up growth and at the same time make growth more inclusive, Dr. Singh would like to emphasize four key aspects of policy framework, such as agriculture and rural development, infrastructure, education, health care and railways.
For railways, Dr. Singh said: "We have set up new mechanisms for attracting private investment in railways. Many private firms are already running container trains. Soon, we will have private investment in logistics parks, railway stations and in coach production."
Dr. Singh further said that the National Highway Programme has been greatly expanded over four years.
"We now have a robust framework of Model Concession Agreements for BOT road contracts and a viability gap funding system in place. The planned investment of over Rs 220,000 crores in roads over the next five years will be a major boost to our infrastructure - and of course, to our automobile sector," he said.
He further added that the power sector is seeing a major expansion and private participation in power generation has revived, particularly after the Ultra Mega Power Projects were launched.
Speaking on the education and healthcare, which are the two other areas, which have been given primacy, he said: "The share of the expenditure on education in the Central Gross Budgetary Support is going up from 7.68 per cent in the 10th Plan to over 19 per cent in the 11th Plan."
The Prime Minister said that all these initiatives should have a positive impact on the growth process and make it more inclusive. (ANI)
Addressing the annual session of the Federation of Indian Chambers of Commerce and Industry (FICCI), Dr. Singh said that our economy is mainly driven by domestic factors, particularly improved investment, demand and consumption.
"On one hand, our economy is sticking along smoothly having registered a growth rate of 9.6 per cent last year and likely to touch almost 9 percent this year. On the other hand, there are clouds on the horizon with distinct possibilities of the global economy, particularly the developed world facing a downturn in the coming year to some extent," he added.
Highlighting the strong fundamentals of the economy, Dr. Singh said that the savings rate in the country has touched almost 35 per cent of Gross Domestic Product (GDP) and the investment rate is at an all time peak of over 36 per cent of the GDP.
Dr. Singh said that the capital formation in both public and private sector is touching new peaks and the inward Foreign Direct Investment (FDI) had crossed 20 billion dollars last year.
While acknowledging the major role of domestic factors in the country's growth story, he admitted that the economy might react to the slowdown elsewhere in the world but assured the investors saying that government would take steps to limit their impact.
To help step up growth and at the same time make growth more inclusive, Dr. Singh would like to emphasize four key aspects of policy framework, such as agriculture and rural development, infrastructure, education, health care and railways.
For railways, Dr. Singh said: "We have set up new mechanisms for attracting private investment in railways. Many private firms are already running container trains. Soon, we will have private investment in logistics parks, railway stations and in coach production."
Dr. Singh further said that the National Highway Programme has been greatly expanded over four years.
"We now have a robust framework of Model Concession Agreements for BOT road contracts and a viability gap funding system in place. The planned investment of over Rs 220,000 crores in roads over the next five years will be a major boost to our infrastructure - and of course, to our automobile sector," he said.
He further added that the power sector is seeing a major expansion and private participation in power generation has revived, particularly after the Ultra Mega Power Projects were launched.
Speaking on the education and healthcare, which are the two other areas, which have been given primacy, he said: "The share of the expenditure on education in the Central Gross Budgetary Support is going up from 7.68 per cent in the 10th Plan to over 19 per cent in the 11th Plan."
The Prime Minister said that all these initiatives should have a positive impact on the growth process and make it more inclusive. (ANI)
Wednesday, February 13, 2008
Air India, Jet plan to buy 60 Boeings
New buys to meet international route expansion needs.
Aircraft manufacturer Boeing is negotiating with the country’s two major carriers Air India and Jet Airways for 60 wide-bodied aircraft.
The combined deals are expected to be valued at $15 billion. Most of these aircraft are being bought for use on international routes.
"Airlines in India like Jet Airways and Air India have firm orders with Boeing for delivery till the year 2011. Now they are planning beyond that in view of expected market growth," said Dinesh Keskar, senior vice-president (sales), Boeing Commercial Airplanes.
Air India is studying how many aircraft it requires and Jet Airways is also planning more wide-bodied aircraft to service the expansion of its international network.
Said S Venkat, executive director (finance), Air India, "The airline will finalise the orders it is going to place with aircraft manufacturers in the next three months. A high-level committee set up to examine the total number of aircraft required beyond 2011 will submit a growth projection and a Request for Proposal has already been made."
Jet Airways Executive Director Saroj Datta said: "We will take a final decision on the new aircraft only after looking at the market situation."
In its growth forecast for the domestic aviation sector, the Seattle-headquartered Boeing put aircraft requirement at 911 worth $86 billion for the next 20 years.
Air India has already contracted orders for 43 wide-bodied aircraft from Boeing which will be completed by 2011 and will be used to replace the older aircraft with the carrier. It has also ordered 27 787 "Dreamliners". The airline's total orderbook with Boeing, including narrow-bodied aircraft, is 68 aircraft valued at $11 billion.
Boeing also has an order to deliver 43 wide-bodied aircraft to Jet Airways till 2012, of which 12 will be Dreamliners.
Boeing also supplies to SpiceJet but these are narrow-bodied aircraft.
Aircraft manufacturer Boeing is negotiating with the country’s two major carriers Air India and Jet Airways for 60 wide-bodied aircraft.
The combined deals are expected to be valued at $15 billion. Most of these aircraft are being bought for use on international routes.
"Airlines in India like Jet Airways and Air India have firm orders with Boeing for delivery till the year 2011. Now they are planning beyond that in view of expected market growth," said Dinesh Keskar, senior vice-president (sales), Boeing Commercial Airplanes.
Air India is studying how many aircraft it requires and Jet Airways is also planning more wide-bodied aircraft to service the expansion of its international network.
Said S Venkat, executive director (finance), Air India, "The airline will finalise the orders it is going to place with aircraft manufacturers in the next three months. A high-level committee set up to examine the total number of aircraft required beyond 2011 will submit a growth projection and a Request for Proposal has already been made."
Jet Airways Executive Director Saroj Datta said: "We will take a final decision on the new aircraft only after looking at the market situation."
In its growth forecast for the domestic aviation sector, the Seattle-headquartered Boeing put aircraft requirement at 911 worth $86 billion for the next 20 years.
Air India has already contracted orders for 43 wide-bodied aircraft from Boeing which will be completed by 2011 and will be used to replace the older aircraft with the carrier. It has also ordered 27 787 "Dreamliners". The airline's total orderbook with Boeing, including narrow-bodied aircraft, is 68 aircraft valued at $11 billion.
Boeing also has an order to deliver 43 wide-bodied aircraft to Jet Airways till 2012, of which 12 will be Dreamliners.
Boeing also supplies to SpiceJet but these are narrow-bodied aircraft.
Monday, February 11, 2008
Yahoo! rejects Microsoft bid of $31/share
The board of directors of Yahoo! today rejected the $31 bid of Microsoft saying the proposal substantially undervalues the company.
Following is the press release issued by Yahoo!
Yahoo! Board of Directors Says Microsoft's Proposal Substantially Undervalues Yahoo!
SUNNYVALE, Calif., Feb 11, 2008 - Yahoo! Inc. (Nasdaq:YHOO), a leading global Internet company, today said the Yahoo! Board of Directors has carefully reviewed Microsoft's unsolicited proposal with Yahoo!'s management team and financial and legal advisors and has unanimously concluded that the proposal is not in the best interests of Yahoo! and our stockholders.
After careful evaluation, the Board believes that Microsoft's proposal substantially undervalues Yahoo! including our global brand, large worldwide audience, significant recent investments in advertising platforms and future growth prospects, free cash flow and earnings potential, as well as our substantial unconsolidated investments. The Board of Directors is continually evaluating all of its strategic options in the context of the rapidly evolving industry environment and we remain committed to pursuing initiatives that maximize value for all stockholders.
Goldman, Sachs & Co., Lehman Brothers and Moelis & Company are acting as financial advisors to Yahoo!. Skadden, Arps, Slate, Meagher & Flom LLP is acting as legal advisor to Yahoo!, and Munger Tolles & Olson LLP is acting as counsel to the outside directors of Yahoo!.
Following is the press release issued by Yahoo!
Yahoo! Board of Directors Says Microsoft's Proposal Substantially Undervalues Yahoo!
SUNNYVALE, Calif., Feb 11, 2008 - Yahoo! Inc. (Nasdaq:YHOO), a leading global Internet company, today said the Yahoo! Board of Directors has carefully reviewed Microsoft's unsolicited proposal with Yahoo!'s management team and financial and legal advisors and has unanimously concluded that the proposal is not in the best interests of Yahoo! and our stockholders.
After careful evaluation, the Board believes that Microsoft's proposal substantially undervalues Yahoo! including our global brand, large worldwide audience, significant recent investments in advertising platforms and future growth prospects, free cash flow and earnings potential, as well as our substantial unconsolidated investments. The Board of Directors is continually evaluating all of its strategic options in the context of the rapidly evolving industry environment and we remain committed to pursuing initiatives that maximize value for all stockholders.
Goldman, Sachs & Co., Lehman Brothers and Moelis & Company are acting as financial advisors to Yahoo!. Skadden, Arps, Slate, Meagher & Flom LLP is acting as legal advisor to Yahoo!, and Munger Tolles & Olson LLP is acting as counsel to the outside directors of Yahoo!.
Reliance Power ends Day 1 at Rs 372
Reliance Power, a subsidairy of Reliance Energy, was listed at Rs 548 - a premium of 21.7% to its issue price of Rs 450 - on the Bombay Stock Exchange (BSE).
The stock hit a high of Rs 600 and dropped to a low of Rs 355 in late trades.
The stock finally ended at Rs 372 - a discount of Rs 78. The weighted average price on the BSE was Rs 413, and around 6.38 crore shares changed hands on the exchange.
On the NSE, the stock was listed at Rs 530, and closed at Rs 372 on hefty volumes of around 13.40 crore shares.
The IPO was subscribed approximately 70 times and attracted over five million bids from all categories of investors with an aggregate commitment of over Rs 7,50,000 crore as against the issue size of Rs 11,560 crore.
"The listing basically shows that one stock can not lift sentiment irrespective of whatever quarter it comes from unless investors see value in them," said Pankaj Namdharni, head, equities, SPA Securities.
"The future of IPOs will depend on the valuation at which promoters decide to sell the issue and the value investors see in a stock. For instance, there is significan upside in REC," said Namdharni.
Adds Gaurang Shah of Geojit: "I was sceptical at the valuation from the beginning and my fears came true. Those who bought the shares at high interest are selling them at whatever prices they can get. There is no buying interest from any quarter, either retail or institutions, which is why the stock is falling," Shah said.
The stock hit a high of Rs 600 and dropped to a low of Rs 355 in late trades.
The stock finally ended at Rs 372 - a discount of Rs 78. The weighted average price on the BSE was Rs 413, and around 6.38 crore shares changed hands on the exchange.
On the NSE, the stock was listed at Rs 530, and closed at Rs 372 on hefty volumes of around 13.40 crore shares.
The IPO was subscribed approximately 70 times and attracted over five million bids from all categories of investors with an aggregate commitment of over Rs 7,50,000 crore as against the issue size of Rs 11,560 crore.
"The listing basically shows that one stock can not lift sentiment irrespective of whatever quarter it comes from unless investors see value in them," said Pankaj Namdharni, head, equities, SPA Securities.
"The future of IPOs will depend on the valuation at which promoters decide to sell the issue and the value investors see in a stock. For instance, there is significan upside in REC," said Namdharni.
Adds Gaurang Shah of Geojit: "I was sceptical at the valuation from the beginning and my fears came true. Those who bought the shares at high interest are selling them at whatever prices they can get. There is no buying interest from any quarter, either retail or institutions, which is why the stock is falling," Shah said.
Internet restored
Internet services in India and the Middle East have been restored completely after Flag Telecom, a subsidiary of Reliance Communications, repaired its damaged Europe-Asia cable and Falcon cable.
Reliance Power falls in early trade
Reliance Power, which made India's biggest-ever initial public offering of $3 billion last month, fell more than 13 percent after debuting at its IPO price 450 rupees on Monday.
Analysts had initially expected the share price to double at opening but stock market turbulence has lowered investor risk appetite and analysts then said a start of 75-150 rupees higher than the IPO price was more realistic.
The utility, part of the Anil Dhirubhai Ambani Group, sold out within a minute of its IPO opening in January. The offer was subscribed 73 times, raising hopes the shares would make a big splash on listing.
Analysts had initially expected the share price to double at opening but stock market turbulence has lowered investor risk appetite and analysts then said a start of 75-150 rupees higher than the IPO price was more realistic.
The utility, part of the Anil Dhirubhai Ambani Group, sold out within a minute of its IPO opening in January. The offer was subscribed 73 times, raising hopes the shares would make a big splash on listing.
Thursday, February 7, 2008
Extremophile Hunt Begins
A team of scientists has just left the country to explore a very strange lake in Antarctica; it is filled with, essentially, extra-strength laundry detergent. No, the researchers haven't spilled coffee on their lab coats. They are hunting for extremophiles -- tough little creatures that thrive in conditions too extreme for most other living things.
Antarctica's Lake Untersee, fed by glaciers, always covered with ice, and very alkaline, is one of the most unusual lakes on Earth. The upper 70 meters of lakewater is so alkaline "its pH is like strong CloroxTM," says expedition leader Richard Hoover of NASA's Marshall Space Flight Center. "And to make it even more interesting, the lake's sediments produce more methane than any other natural body of water on our planet. If we find life here, it will have important implications."
Above: Richard Hoover (left) and colleague S.S. Abyzov examine electron microscope images of microbes found in ancient Antarctic ice. [Larger image]
Lake Untersee is a sort of test case for other exotic places around the solar system (namely Mars, comets, and the icy moons of Jupiter and Saturn) where life might be found in the extremes. Many of those places are cold and methane-rich--"not unlike Lake Untersee."
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"One thing we've learned in recent years," notes Hoover, "is that you don't have to have a 'Goldilocks' zone with perfect temperature, a certain pH level, and so forth, for life to thrive." Researchers have found microbes living in ice, in boiling water, in nuclear reactors. These "strange" extremophiles may in fact be the norm for life elsewhere in the cosmos.
"With our research this year, we hope to identify some new limits for life in terms of temperature and pH levels. This will help us decide where to search for life on other planets and how to recognize alien life if we actually find it."
Hoover has already made some new friends in cold places. Earlier Hoover teams have found new species and genera of anaerobic microbial extremophiles in the ice and permafrost of Alaska, Siberia, Patagonia, and Antarctica.
"I found one extremophile in penguin guano," recalls Hoover. "When I stooped to pick it up, Jim Lovell, my research partner then, said, 'What the heck are you doing now, Richard?' But it paid off."
Antarctica's Lake Untersee, fed by glaciers, always covered with ice, and very alkaline, is one of the most unusual lakes on Earth. The upper 70 meters of lakewater is so alkaline "its pH is like strong CloroxTM," says expedition leader Richard Hoover of NASA's Marshall Space Flight Center. "And to make it even more interesting, the lake's sediments produce more methane than any other natural body of water on our planet. If we find life here, it will have important implications."
Above: Richard Hoover (left) and colleague S.S. Abyzov examine electron microscope images of microbes found in ancient Antarctic ice. [Larger image]
Lake Untersee is a sort of test case for other exotic places around the solar system (namely Mars, comets, and the icy moons of Jupiter and Saturn) where life might be found in the extremes. Many of those places are cold and methane-rich--"not unlike Lake Untersee."
Sign up for EXPRESS SCIENCE NEWS delivery
"One thing we've learned in recent years," notes Hoover, "is that you don't have to have a 'Goldilocks' zone with perfect temperature, a certain pH level, and so forth, for life to thrive." Researchers have found microbes living in ice, in boiling water, in nuclear reactors. These "strange" extremophiles may in fact be the norm for life elsewhere in the cosmos.
"With our research this year, we hope to identify some new limits for life in terms of temperature and pH levels. This will help us decide where to search for life on other planets and how to recognize alien life if we actually find it."
Hoover has already made some new friends in cold places. Earlier Hoover teams have found new species and genera of anaerobic microbial extremophiles in the ice and permafrost of Alaska, Siberia, Patagonia, and Antarctica.
"I found one extremophile in penguin guano," recalls Hoover. "When I stooped to pick it up, Jim Lovell, my research partner then, said, 'What the heck are you doing now, Richard?' But it paid off."
Wednesday, February 6, 2008
Pay cuts, job cuts unnerve IT employees
Techies are in a state of shock over large-scale retrenchment of their colleagues in IBM and TCS, the information technology giants. With rumours flying fast and thick, IT employees find themselves worried about their future.
Websites and blogs of techies reflect a state of uncertainty and insecurity. With a rising rupee and slowdown in the U.S. economy taking their toll, employees of IT companies do not know when the situation will change for the better.
An IBM employee told The Hindu that about 1,500 employees have been shown the door in the past month. Pampered with fancy salaries and cushy working conditions, these employees find the developing situation deeply disturbing. Pay cuts, as in the Tata Consultancy Services now, are virtually unheard of. “Though the company has the right to deduct the ‘variable component,’ we are worried at an impending downsizing,” says Ravi K. of TCS. Twenty per cent of the variable pay of all TCS employees has been deducted.
In an attempt to assuage fears, the IT majors, however, say such sackings are routine and part of their “quality control exercise.” While IBM confirmed the axe has fallen on employees, it does not reveal how many have been given the sack. TCS, which is reported to have sacked 500 employees at different management levels, maintains that it was a routine exercise and that the pay cut was temporary.
Websites and blogs of techies reflect a state of uncertainty and insecurity. With a rising rupee and slowdown in the U.S. economy taking their toll, employees of IT companies do not know when the situation will change for the better.
An IBM employee told The Hindu that about 1,500 employees have been shown the door in the past month. Pampered with fancy salaries and cushy working conditions, these employees find the developing situation deeply disturbing. Pay cuts, as in the Tata Consultancy Services now, are virtually unheard of. “Though the company has the right to deduct the ‘variable component,’ we are worried at an impending downsizing,” says Ravi K. of TCS. Twenty per cent of the variable pay of all TCS employees has been deducted.
In an attempt to assuage fears, the IT majors, however, say such sackings are routine and part of their “quality control exercise.” While IBM confirmed the axe has fallen on employees, it does not reveal how many have been given the sack. TCS, which is reported to have sacked 500 employees at different management levels, maintains that it was a routine exercise and that the pay cut was temporary.
Yahoo seeking ways to avoid a Microsoft offer
Yahoo chief executive Jerry Yang has sent a message to employees, assuring them the firm's leaders are exploring ways to avoid a takeover by software giant Microsoft.
In an email to Yahoo workers yesterday, Yang said the board of directors has yet to decide how to respond to Microsoft's offer to buy the veteran Internet company for $44.60 billion in cash and stock.
"Our board is thoughtfully evaluating a wide range of potential strategic alternatives in what is a complex and evolving landscape," Yang wrote in the email, which was filed with the US Securities and Exchange Commission.
"What has become clear in the past few days is how much people care about this company. I have heard from many of you, and from other friends and colleagues from around Silicon Valley and across the globe, that we need to do what is best for Yahoo and our shareholders."
Microsoft's unsolicited offer to pay the equivalent of $31 per share for Yahoo highlights the 14-year-old California firm's potential to recapture past glory, Yang told employees.
Microsoft publicly announced what it billed as a "generous" offer for Yahoo on February 1 and said its plan is to combine resources to take on Internet powerhouse Google.
Google has come out against the proposed takeover, condemning it as an attack on the freedom of the Internet.
Yahoo has received calls from "a number of interested parties" and has a wide range of strategic options, a source close to Yahoo told AFP.
Those options include outsourcing online advertising to arch-rival Google, a proven master at pumping revenues from that well.
In an email to Yahoo workers yesterday, Yang said the board of directors has yet to decide how to respond to Microsoft's offer to buy the veteran Internet company for $44.60 billion in cash and stock.
"Our board is thoughtfully evaluating a wide range of potential strategic alternatives in what is a complex and evolving landscape," Yang wrote in the email, which was filed with the US Securities and Exchange Commission.
"What has become clear in the past few days is how much people care about this company. I have heard from many of you, and from other friends and colleagues from around Silicon Valley and across the globe, that we need to do what is best for Yahoo and our shareholders."
Microsoft's unsolicited offer to pay the equivalent of $31 per share for Yahoo highlights the 14-year-old California firm's potential to recapture past glory, Yang told employees.
Microsoft publicly announced what it billed as a "generous" offer for Yahoo on February 1 and said its plan is to combine resources to take on Internet powerhouse Google.
Google has come out against the proposed takeover, condemning it as an attack on the freedom of the Internet.
Yahoo has received calls from "a number of interested parties" and has a wide range of strategic options, a source close to Yahoo told AFP.
Those options include outsourcing online advertising to arch-rival Google, a proven master at pumping revenues from that well.
Tuesday, February 5, 2008
Team develops energy-efficient microchip
Could lead to longer-lasting, self-charging cell phones, more
Researchers at MIT and Texas Instruments have unveiled a new chip design for portable electronics that can be up to 10 times more energy-efficient than present technology. The design could lead to cell phones, implantable medical devices and sensors that last far longer when running from a battery.
The innovative design is being presented Feb. 5 at the International Solid-State Circuits Conference in San Francisco by Joyce Kwong, a graduate student in MIT's Department of Electrical Engineering and Computer Science (EECS).
Kwong carried out the project with MIT colleagues Anantha Chandrakasan, the Joseph F. and Nancy P. Keithley Professor of Electrical Engineering, and EECS graduate students Yogesh Ramadass and Naveen Verma. Their Texas Instruments (TI) collaborators are Markus Koesler, Korbinian Huber and Hans Moormann. The team demonstrated the ultra-low-power design techniques on TI's MSP430, a widely used microcontroller. The work was conducted at the MIT Microsystems Technology Laboratories, which Chandrakasan directs.
The key to the improvement in energy efficiency was to find ways of making the circuits on the chip work at a voltage level much lower than usual, Chandrakasan explains. While most current chips operate at around one volt, the new design works at just 0.3 volts.
Reducing the operating voltage, however, is not as simple as it might sound, because existing microchips have been optimized for many years to operate at the higher standard-voltage level. "Memory and logic circuits have to be redesigned to operate at very low power supply voltages," Chandrakasan says.
One key to the new design, he says, was to build a high-efficiency DC-to-DC converter--which reduces the voltage to the lower level--right on the same chip, reducing the number of separate components. The redesigned memory and logic, along with the DC-to-DC converter, are all integrated to realize a complete system-on-a-chip solution.
One of the biggest problems the team had to overcome was the variability that occurs in typical chip manufacturing. At lower voltage levels, variations and imperfections in the silicon chip become more problematic. "Designing the chip to minimize its vulnerability to such variations is a big part of our strategy," Chandrakasan says.
So far the new chip is a proof of concept. Commercial applications could become available "in five years, maybe even sooner, in a number of exciting areas," Chandrakasan says. For example, portable and implantable medical devices, portable communications devices and networking devices could be based on such chips, and thus have greatly increased operating times. There may also be a variety of military applications in the production of tiny, self-contained sensor networks that could be dispersed in a battlefield.
In some applications, such as implantable medical devices, the goal is to make the power requirements so low that they could be powered by "ambient energy," Chandrakasan says--using the body's own heat or movement to provide all the needed power. In addition, the technology could be suitable for body area networks or wirelessly enabled body sensor networks.
"Together, TI and MIT have pioneered many advances that lower power in electronic devices, and we are proud to be part of this revolutionary, world-class university research," said Dr. Dennis Buss, chief scientist at Texas Instruments. "These design techniques show great potential for TI's future low-power integrated circuit products and applications including wireless terminals, battery-operated instrumentation, sensor networks and medical electronics."
The research was funded in part by a grant from the U.S. Defense Advanced Research Projects Agency.
Researchers at MIT and Texas Instruments have unveiled a new chip design for portable electronics that can be up to 10 times more energy-efficient than present technology. The design could lead to cell phones, implantable medical devices and sensors that last far longer when running from a battery.
The innovative design is being presented Feb. 5 at the International Solid-State Circuits Conference in San Francisco by Joyce Kwong, a graduate student in MIT's Department of Electrical Engineering and Computer Science (EECS).
Kwong carried out the project with MIT colleagues Anantha Chandrakasan, the Joseph F. and Nancy P. Keithley Professor of Electrical Engineering, and EECS graduate students Yogesh Ramadass and Naveen Verma. Their Texas Instruments (TI) collaborators are Markus Koesler, Korbinian Huber and Hans Moormann. The team demonstrated the ultra-low-power design techniques on TI's MSP430, a widely used microcontroller. The work was conducted at the MIT Microsystems Technology Laboratories, which Chandrakasan directs.
The key to the improvement in energy efficiency was to find ways of making the circuits on the chip work at a voltage level much lower than usual, Chandrakasan explains. While most current chips operate at around one volt, the new design works at just 0.3 volts.
Reducing the operating voltage, however, is not as simple as it might sound, because existing microchips have been optimized for many years to operate at the higher standard-voltage level. "Memory and logic circuits have to be redesigned to operate at very low power supply voltages," Chandrakasan says.
One key to the new design, he says, was to build a high-efficiency DC-to-DC converter--which reduces the voltage to the lower level--right on the same chip, reducing the number of separate components. The redesigned memory and logic, along with the DC-to-DC converter, are all integrated to realize a complete system-on-a-chip solution.
One of the biggest problems the team had to overcome was the variability that occurs in typical chip manufacturing. At lower voltage levels, variations and imperfections in the silicon chip become more problematic. "Designing the chip to minimize its vulnerability to such variations is a big part of our strategy," Chandrakasan says.
So far the new chip is a proof of concept. Commercial applications could become available "in five years, maybe even sooner, in a number of exciting areas," Chandrakasan says. For example, portable and implantable medical devices, portable communications devices and networking devices could be based on such chips, and thus have greatly increased operating times. There may also be a variety of military applications in the production of tiny, self-contained sensor networks that could be dispersed in a battlefield.
In some applications, such as implantable medical devices, the goal is to make the power requirements so low that they could be powered by "ambient energy," Chandrakasan says--using the body's own heat or movement to provide all the needed power. In addition, the technology could be suitable for body area networks or wirelessly enabled body sensor networks.
"Together, TI and MIT have pioneered many advances that lower power in electronic devices, and we are proud to be part of this revolutionary, world-class university research," said Dr. Dennis Buss, chief scientist at Texas Instruments. "These design techniques show great potential for TI's future low-power integrated circuit products and applications including wireless terminals, battery-operated instrumentation, sensor networks and medical electronics."
The research was funded in part by a grant from the U.S. Defense Advanced Research Projects Agency.
500 TCS staffers asked to resign for poor performance
Announces change in HR guard.
Information Technology (IT) firms appear to be hardening their stance when it comes to assessing employee performance to raise employee productivity in the wake of a rising rupee.
For instance, India’s largest IT services provider, Mumbai-based Tata Consultancy Services, today said that around 500 (around 0.5 per cent of its total employee strength of over 100,000) of its staff had resigned due to poor performance.
TCS’ move follows the cut that the company had effected on the portion of variable pay linked to the employees performance, reducing the salary by about 1.5 per cent for the January-March 2008 quarter.
Commenting on the staff-cut, a TCS spokesperson told Business Standard: “Our company has a biannual appraisal system — one between June and July, and the other in January-February — when we rate employees on a scale of 1-5 (5 being the highest). Those employees who score a low figure of 2, for instance, are asked to either repeat their training programme or are sent for counselling — depending on whether they are freshers or middle management executives. Those who cannot meet the performance requirements of our company are asked to look for another job.”
Last year too, around 500 people suffered a similar fate since they could not meet the performance rating numbers, the spokesperson pointed out.
In the third quarter ending December 31, 2007, TCS added 4,037 net staff taking its total headcount to 108,229, up from 83,500 a year ago. At the close of trade, TCS shares were down around 2.72 per cent at Rs 949 on the Bombay Stock Exchange.
Meanwhile, TCS also announced that it has appointed Ajoyendra Mukherjee as the global head of human resources following incumbent S Padmanabhan’s move to Tata Power as an executive director, operations.
“S Padmanabhan (Paddy) has been an integral part of TCS’ success and growth in the last two decades. We are particularly appreciative of the tremendous leadership and contribution he has made in the area of HR, a function he took over four years back,” said S Ramadorai, CEO and MD.
“We would like to welcome Ajoy Mukherjee in his new role which he is well-equipped to perform given his vast experience in this company and industry.”
A graduate from BITS (Pilani), Mukherjee joined the company in 1980, and was vice-president and head of operations, eastern region. Ritu Anand has been appointed as the deputy global head of human resources and will report to Ajoy Mukherjee.
IBM too, which has 73,000 staffers in India, is working on ways to certify the skill levels of its employees. A week ago, the firm laid off 500 to 600 freshers.
Other IT firms may follow suit, said analysts. An IBM spokesperson said the move was “no hindrance to the business. It was merely based on the employees performance”, adding that IBM India today expanded its operations in UP with a new Global Delivery Centre in Noida.
The company will open another centre in the vicinity. Both centres will house close to 3,000 employees once fully staffed.
Information Technology (IT) firms appear to be hardening their stance when it comes to assessing employee performance to raise employee productivity in the wake of a rising rupee.
For instance, India’s largest IT services provider, Mumbai-based Tata Consultancy Services, today said that around 500 (around 0.5 per cent of its total employee strength of over 100,000) of its staff had resigned due to poor performance.
TCS’ move follows the cut that the company had effected on the portion of variable pay linked to the employees performance, reducing the salary by about 1.5 per cent for the January-March 2008 quarter.
Commenting on the staff-cut, a TCS spokesperson told Business Standard: “Our company has a biannual appraisal system — one between June and July, and the other in January-February — when we rate employees on a scale of 1-5 (5 being the highest). Those employees who score a low figure of 2, for instance, are asked to either repeat their training programme or are sent for counselling — depending on whether they are freshers or middle management executives. Those who cannot meet the performance requirements of our company are asked to look for another job.”
Last year too, around 500 people suffered a similar fate since they could not meet the performance rating numbers, the spokesperson pointed out.
In the third quarter ending December 31, 2007, TCS added 4,037 net staff taking its total headcount to 108,229, up from 83,500 a year ago. At the close of trade, TCS shares were down around 2.72 per cent at Rs 949 on the Bombay Stock Exchange.
Meanwhile, TCS also announced that it has appointed Ajoyendra Mukherjee as the global head of human resources following incumbent S Padmanabhan’s move to Tata Power as an executive director, operations.
“S Padmanabhan (Paddy) has been an integral part of TCS’ success and growth in the last two decades. We are particularly appreciative of the tremendous leadership and contribution he has made in the area of HR, a function he took over four years back,” said S Ramadorai, CEO and MD.
“We would like to welcome Ajoy Mukherjee in his new role which he is well-equipped to perform given his vast experience in this company and industry.”
A graduate from BITS (Pilani), Mukherjee joined the company in 1980, and was vice-president and head of operations, eastern region. Ritu Anand has been appointed as the deputy global head of human resources and will report to Ajoy Mukherjee.
IBM too, which has 73,000 staffers in India, is working on ways to certify the skill levels of its employees. A week ago, the firm laid off 500 to 600 freshers.
Other IT firms may follow suit, said analysts. An IBM spokesperson said the move was “no hindrance to the business. It was merely based on the employees performance”, adding that IBM India today expanded its operations in UP with a new Global Delivery Centre in Noida.
The company will open another centre in the vicinity. Both centres will house close to 3,000 employees once fully staffed.
Monday, February 4, 2008
Google 'troubled' by Microsoft bid for Yahoo
Internet giant Google has said it finds "troubling" Microsoft's multi-billion-dollar bid to acquire rival Yahoo and urged US and international regulators to scrutinise the proposed deal.
"Microsoft's hostile bid for Yahoo raises troubling questions," read a statement by David Drummond, Google's senior vice president for corporate development and chief legal officer. "This is about more than simply a financial transaction, one company taking over another. It's about preserving the underlying principles of the Internet: openness and innovation," he said in a written statement yesterday.
He accused Microsoft of using its competitive advantage in the personal computer market to gain "inappropriate and illegal influence over the Internet" and said it was likely to try to do the same if it acquires Yahoo.
"Microsoft has frequently sought to establish proprietary monopolies - and then leverage its dominance into new, adjacent markets," he said, adding that the Redmond, California-based company has a "legacy of serious legal and regulatory offenses" which it could not extend to the Internet.
Microsoft announced on Friday it is courting California-based Yahoo with a $44.6-billion offer. Members of Congress's House of Representatives Judiciary Committee have scheduled a hearing later this week to probe the antitrust implications of such a merger. The committee's Antitrust and Competitive Policy task force will hold the hearing to give the proposed Microsoft-Yahoo merger "careful examination," the panel said in a statement.
"Microsoft's hostile bid for Yahoo raises troubling questions," read a statement by David Drummond, Google's senior vice president for corporate development and chief legal officer. "This is about more than simply a financial transaction, one company taking over another. It's about preserving the underlying principles of the Internet: openness and innovation," he said in a written statement yesterday.
He accused Microsoft of using its competitive advantage in the personal computer market to gain "inappropriate and illegal influence over the Internet" and said it was likely to try to do the same if it acquires Yahoo.
"Microsoft has frequently sought to establish proprietary monopolies - and then leverage its dominance into new, adjacent markets," he said, adding that the Redmond, California-based company has a "legacy of serious legal and regulatory offenses" which it could not extend to the Internet.
Microsoft announced on Friday it is courting California-based Yahoo with a $44.6-billion offer. Members of Congress's House of Representatives Judiciary Committee have scheduled a hearing later this week to probe the antitrust implications of such a merger. The committee's Antitrust and Competitive Policy task force will hold the hearing to give the proposed Microsoft-Yahoo merger "careful examination," the panel said in a statement.
Friday, February 1, 2008
Microsoft Corp offers $44.6 billion for Yahoo! Inc
Microsoft said on Friday it had offered to buy search engine group Yahoo with a proposal that values the internet group’s equity at $44.6 billion, as the software giant seeks to catch up with arch-rival Google.
If completed, it would be the largest acquisition that Microsoft has made and the biggest internet merger since AOL bought Time Warner for $112 billion in 2000.
The unsolicited cash proposal, with a cash and shares alternative, is pitched at $31 a share, a 62 per cent premium to Yahoo’s closing share price of $19.18 on Thursday. Shares in Yahoo jumped 53 per cent to $29.13 in pre-market trading, while Microsoft was $1.60 lower at $31.
The proposed offer price is below Yahoo’s 52-week high of $34.08 reached last October.
Microsoft signalled that a combination of the two companies would provide stronger competition for Google, the leading internet search engine. It said the proposed combination could generate synergies of $1 billion, and provide significant economies of scale.
Steve Ballmer, Microsoft chief executive, said: “We see this as the next major milestone in the transformation of the company to embrace online services.
“Microsoft and Yahoo are companies that share a vision for online services and the result of a combination will be a company that is more efficient and successful.”
Microsoft has been trying to build market share in online advertising with acquisitions such as the $6 billion purchase of Aquantive last year. The company has stated a goal of being the number two in this market within the next few years.
“They have set a series of very aggressive goals, but overall Microsoft’s online business is floundering and the only way they can grow their business is with a big acquisition like this,” said Ian Maude, analyst at Enders Analysis.
However, Maude was sceptical how much the deal would help Microsoft.
“The main problem is that online advertising is largely driven by search, and Google owns that market. The one thing this deal doesn’t do is fix that problem,” he said.
Microsoft said it had been in on-off talks with Yahoo over the last 18 months about a combination, but had been turned down by Yahoo’s board, which had been hoping to see an improvement in the company’s performance under a new turnaround strategy.
However, in a strongly-worded letter to Yahoo’s board, Ballmer said: “A year has gone by, and the competitive situation has not improved.”
In a short statement in response, Yahoo said its board would “evaluate this proposal carefully and promptly in the context of Yahoo’s strategic plans and pursue the best course of action to maximize long-term value for shareholders.”
Microsoft has struck as Wall Street is growing increasingly disillusioned with Yahoo. The search engine group’s earnings before interest, tax, depreciation and amortisation are projected to fall to 32 per cent of revenue in 2008.
That is sharply down from a margin of 38 per cent in 2007, with Yahoo having promised to improve the situation in 2009.
Yahoo’s shares slid earlier this week after it issued a downbeat outlook for this year reflecting its struggles to revamp its core online services.
The decline took the total fall since October to 45 per cent and pointed to Wall Street’s growing doubts that co-founder Jerry Yang, who stepped into the chief executive chair last year, can revive the fortunes of one of the brightest stars of the internet’s first decade.
Henry Blodget, the former technology analyst writing on his blog, said: “This is a brilliant move by Microsoft — a big premium dangled in front of battered Yahoo shareholders, but a price that would have seemed absurdly low as recently as six months ago. Given Yahoo’s battered stock and low 2008 outlook, we expect the offer will be accepted.”
“This deal looks much more likely to happen this time,” agreed John Delaney, analyst at Ovum. “Yahoo hasn’t made a convincing turnaround, and advertising is in a precarious position in a downturn. Microsoft would provide a safehaven for the company in a worsening economic climate.” Microsoft said a combination with Yahoo would benefit from economies of scale in the online advertising market. Other advantages included pooling engineering talent to accelerate innovation, operational efficiencies by stripping out costs, and the ability to seize on emerging opportunities such as video and mobile. Kevin Johnson, Microsoft’s president of platforms and services, said: “The combined assets and strong services focus of these two companies will enable us to achieve scale economics while reaching R&D critical mass to deliver innovation breakthroughs.”
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