Diesel prices may rise
New Delhi: To manage the oil pool account better, the petroleum ministry is considering an increase in the price of petrol by Rs.2 per litre.

The price of diesel rose from $124 a tonne on 20 April 1999 to $163 a tonne in August 1999. There is a 30 per cent customs duty on diesel. These two factors translate into a price increase of around Rs.2 per litre.

The petroleum ministry said that  the oil pool account was losing Rs.5,800 crore and Rs.6,200 crore at oil prices of $19 per barrel and $21 per barrel respectively.
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Trai pulls up DoT, MTNL
New Delhi: The department of telecommunications may be hauled up by the Telecom Regulatory Authority of India for not having protected the interests of consumers while revoking the cellular licence granted to Koshika Telecom.

According to a report published in the Business Standard, Trai may force DoT to include in its licence agreement a clause to make it  an obligation for the licensor to ensure continuous service.

DoT had terminated Koshika's licence and disconnected its fixed line network facility in Uttar Pradesh (West). Koshika’s consumers approached Trai and petitioned it to order DoT to restore the services.

The last day for operators to provide DoT with bank guarantees against outstanding license fees is 30 November 1999.

Trai has stayed Mahanagar Telephone Nigam Ltd. (MTNL) plans to provide CDMA-based limited mobility services. The stay will remain in force until clarifications are received from MTNL and DoT.

In the meantime, the government has decided to take stringent action against those companies wilfully defaulting on their payments on the basis of the new telecom policy.
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India preparing for WTO meet
New Delhi: According to a report published in the Business Standard, Brajesh Mishra, principal secretary to the prime minister, has called for a meeting on 9 September 1999, to prepare India’s strategy for the meet.

The meeting is scheduled to be held on 30 November 1999 in Seattle, USA. N K Singh, secretary in the prime minister’s office, Piyush Mankad, finance secretary, and some commerce ministry officials will attend the meet.
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ICICI Home consolidates
Mumbai: ICICI Home Finance has brought down the number of interest rate slabs from three to two. Now the interest rates on loans below Rs.10 lakh is 13.5 per cent and over Rs.10 lakh is 14.5 per cent.

The Rs.2 lakh to Rs.5 lakh slab that earlier existed has been clubbed with the under-Rs.10 lakh slab. ICICI Home Finance is a wholly-owned subsidiary of ICICI Personal Financial Services Ltd.
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Auto industry a hit
New Delhi: According to a report in the Economic Times, the auto sector has been the most favourite investment avenue for foreigners.

Since May 1991, when the sector was opened up for foreign investment, the sector has attracted investments of Rs.4,772 crore and has gained a 7.8 per cent share of the total inflows. The ratio between the inflows and approvals in the auto industry has crossed 34 per cent, which is among the highest for all sectors.
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ICICI rating upgraded
Mumbai: Standard & Poor’s has upgraded the credit rating of ICICI Ltd. from ‘negative’ outlook to ‘stable’ outlook. ICICI has been given a long-term rating of 'BB' and a short-term foreign currency of ‘B’.

The upgrade comes on the eve of the financial institution’s proposed Rs.275-crore public issue that opens on 9 September 1999. ICICI is now rated one notch higher than rival Industrial Development Bank of India and is on par with India’s sovereign credit rating.

ICICI will float its second asset management company all by itself. A mutual fund dedicated to buy debentures on the books of the financial institution will be floated by the new AMC.

ICICI already has another AMC in partnership with Prudential of the UK.
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NRE deposits rise
New Delhi: Non-resident external rupee account (NRERA) deposits have been increasing even though the Reserve Bank of India recently removed the exchange rate cover on such accounts. The deposits have swelled mainly because of remittances from the Middle East.

The figures for NRERA deposits in April 1999 and May 1999 were $6,278 million and $6,315 million respectively. In 1998 these deposits were hovering around the $5,600 million mark.
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SBI, PFC in swap deal
Mumbai: The State Bank of India and the Power Finance Corporation of India have entered into a $15-million rupee-dollar swap. The State Bank will provide foreign exchange risk cover for foreign currency liabilities of PFC up to $15 million.

PFC will not carry the exchange rate or interest rate risk on its dollar liabilities, and can convert its dollar flows into fixed rate rupee flows.
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Fed gives the go ahead to Fleet
Washington: The Federal Reserve has given permission to Fleet Financial Group to acquire BankBoston for $16 billion. The acquisition will create the largest banking group in the US north-east.

The two erstwhile rivals have agreed to sell $13.2 billion worth of deposits and 306 branches to stay clear of anti-trust regulations. Fleet will sell $12 billion worth of deposits and 278 branches to Sovereign Corp. The rest of the commitment will be sold to community banks in Massachusetts.
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