ICICI merger plan hits roadblock
Mumbai: After having made a detailed presentation to the country’s apex bank, ICICI has found that its plans to convert itself into a universal bank may hit a roadblock.

According to industry sources, the Reserve Bank of India is unwilling to clear its proposal at this stage, as a result of which ICICI has temporarily shelved its idea of converting itself into a universal bank. It is understood that RBI is more in favour of a gradual and graded change of the financial institution into a bank.

In effect, the central bank has turned down ICICI’s plea for exemption of compliance with liquidity and cash reserve norms for some time. RBI apparently wants ICICI to adhere to small doses of statutory liquidity ratio (SLR), cash reserve ratio (CRR) and priority sector stipulations on its existing liabilities and assets to be eligible to have restricted access to demand deposits on the course to become a full-fledged bank.

The apex bank’s contention was that if ICICI is allowed specific concessions on this ground, other banks would be denied of a level playing field.
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Battle over disinvestment may cost Air India managing director his job
Mumbai: As the battle between the proponents and opponents of disinvestment in public sector, Air India, rages, it is likely that the airline’s managing director, Mr. Michael Mascerenhas, may be caught in the cross-fire.

With the ministry of civil aviation on Wednesday reshuffling the portfolios’ of three of the executive directors, the word in the corridors of the airline’s headquarters is that Mr. Mascerenhas may be asked to go.

The anti-divestment lobby is working hard to ensure that no foreign airline gets a foothold into Air India. This is being done in various ways, even an issue like non-cooperation from the foreign partner in case of a national emergency is being raised at various levels.

The bogey of Air-India’s assets being stripped by the partner company if operations are not viable, is being raised with gusto.However, the issue of foreign versus domestic partners is far from settled and various theories against a foreign airline partner are still being touted.

The latest ministry move has brought the issue of government interference in the running of Air-India even more sharply in focus.
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