The proposal is now with the prime minister's office. The cabinet will study it before recommending it for acceptance. The cabinet will also vet the new telecom package where private telecom operators will shift to a different payment system.
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Gen Musharraf pulls back forces
Islamabad: The army ruler of Pakistan, Gen Pervez Musharraf, has announced a unilateral "military de-escalation" along the international borders with India and pulled back forces that had moved forward in the recent past. The idea to give thrust to an "unconditional result-oriented" dialogue with the government of India on all issues, including Kashmir.

"I take this opportunity to announce a unilateral military de-escalation on our international borders with India and initiate the return of all forces moved to borders in the recent past," the general said. However, Gen Musharraf did not mention any de-escalation on the line of control in his 25-minute address to the nation.
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Inflation moves up
New Delhi: The rate of inflation measured by the wholesale price index has gone up to 1.95 per cent for the week ended 2 October 1999. Rise in vegetable prices during the week was the main cause of the rise in the inflation rate.
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Tasks before Sinha
New Delhi: The cabinet will soon have to decide on reducing the government stake in public sector banks to 51 per cent. Finance minister Yashwant Sinha has said that the issue of recapitalisation or merger of weak banks will be taken up by the new government.

There is also a plan to create an ‘independent monetary authority’ that will replace the Reserve Bank of India and will operate on similar lines as the German Bundesbank. A separate organisation may be set up to look at competition policy and the anti trust-issues in the financial sector.

A decision on the reduction of subsidies on LPG, kerosene and food will also form part of the agenda. Reduction of subsidies will be part of the list of expenditure heads that will be reviewed to reduce the fiscal deficit. There may also be an increase in taxes. In November 1999, a meeting of chief ministers of state will be held to discuss the introduction of value-added tax.

All ministries will start implementing zero-based budgeting from 2000.

In the meanwhile, the finance ministry has rejected a Sebi proposal to allow companies incorporated abroad to be listed on the local stock exchanges.
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‘FI nominee’ controversy to be put to rest
Mumbai: The Kumar Mangalam Birla Committee on corporate governance appointed by the Securities and Exchange Board of India has informed financial institutions that it only wants companies to be as transparent to shareholders as they are with fund managers and analysts. The panel only wants fund managers not to be present on the boards of companies.

If the financial institutions are confused about the concerned section of the report, the panel may redraft the section. This puts to an end the controversy created by the corporate governance committee report, which financial institutions perceived as wanting to restrict their nomination of directors to the boards of companies to which they have loaned substantial sums of money.
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IFC seeks more time before conversion of GTB debt to equity
Mumbai: The International Finance Corporation, which has lent $5 million to Global Trust Bank, has sought a postponement of one year for converting the loan into equity. The loan, when converted into equity, will raise the IFC's stake in Global Trust to 13 per cent from the current 9.6 per cent.

IFC would have to provide for a depreciation of $2 million in its books if it marks to market the investment it has made in Global Trust. This is why the IFC is seeking time for the conversion of debt into equity.
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Mumbai, Karachi show fastest population growth
New Delhi: According to a report of the United Nations Environment Programme, population in Mumbai and Karachi is growing at 4.2 per cent per annum. Delhi has a growth rate of 3.8 per cent.

Delhi, Mumbai and Calcutta are also in the top ten list of Asian cities in terms of pollution, exceeding World Health Organisation standards by over three times.
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