Rupee continues to slide
Mumbai: The rupee continued its downward slide on the back of dollar demand from small corporates, after touching an intra-day high of 44.52 in morning deals.

The market opened on a positive note with dealers hoping that exporters would come in and sell their dollars. But exporters thought otherwise, and held back, hoping for a greater fall. Futher, with the stock markets looking up, there was also the hope that the FIIs’ would be bringing in more funds.

In the forward segment, heavy receiving by banks across all maturities led premiums to end lower. The six-month forward annualised premium ended the day at 2.49 per cent (55/56 paise) against its previous close of 2.63 per cent while the 12-month premium ended at 2.72 per cent (120/122 paise), down from Tuesday’s close of 2.82 per cent.
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Finally, Fema replaces Fera
New Delhi: The draconian Foreign Exchange Regulation Act (Fera), which played havoc for many decades, will soon lapse into history, bringing relief to the corporate world.

Enacted in 1973 in the backdrop of acute shortage of foreign exchange in the country, Fera had a controversial run for 27 years during which many big names in the Indian corporate world found themselves at the receiving end in the hands of the enforcement directorate.

The new enactment promulgated by parliament, the Foreign Exchange Management Act (Fema), will replace Fera. The enactment is more forward looking and is said to be more compatible with the pro-liberalisation policies. The most significant change brought in by Fema is that forex law violators would no longer be treated as criminals but as civil offenders.

The cases already under Fera purview would have to be settled within a time period of two years, that is May 31, 2001, beyond which it would lapse. However, if the Fera cases were in court, it would end with the verdict given by the judicial officer.

There are around 4,000 cases which are before the courts under Fera and another 3,000, in which investigation is almost complete and the same ready for filing before the competent courts according to the enforcement directorate chief.

Fema has been welcomed by the industrial chambers with Assocham saying that the introduction of the new law was a in tune with economic liberalisation which has proved beyond doubt that stringent laws of the early seventies need to be done away with.
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Amex to co-brand its cards with MTNL and Indian Airlines
New Delhi: In an ever-growing credit card market in the country, the world’s largest credit card company, American Express, has decided to pursue an aggressive strategy of launching cobranded credit cards in a bid to step up its presence in India.

It has recently entered into co-branding tieups with MTNL and Indian Airlines and is said to be planning similar arrangements across the hospitality, utilities and financial services sectors. The card company is looking at exclusive and non-exclusive tie-ups in its attempt to beat competition. In doing so, it is following the strategy adopted by the company abroad, where Amex has several co-branded products.

According to industry estimates, about 3.8 million credit cards have been issued in India and credit card billing in the country is around $1.5 billion. It is estimated that Amex’s credit card business in India had grown by 50 per cent in 1999 both in terms of new credit cards well as billings and the company aims to keep up this growth rate
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IDFC set to fund telecom acquisitions
Chennai: With increasing consolidation in the telecommunications industry, the Infrastructure Development Finance Co Ltd (IDFC) has identified acquisition financing as a new financing avenue for the next few years.

This would result in consolidation of operations in cellular services in the country. According to Mr. Nasser Munjee, managing director of IDFC, the funding of acquisitions in this areas would only help further investments in the sector.

During 1999-2000, IDFC approved assistance for acquisition of cellular licensees operating in two circles and one metro for such players as Bharti Televentures Ltd, BPL Mobile Communications Ltd and BPL Cellular Holdings Ltd .

Mr. Munjee said that telecom projects were taking off mainly because there was clarity in policy. And if long distance telephony was opened up, there would be more investments in the sector.

IDFC also plans to set up a policy group on integrated transport logistics, besides funding Internet backbone projects.
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