Rupee remains firm against dollar

MUMBAI, Aug 18: The rupee posted smart gains and closed the week at a six-and a-half month high of 48.57/58 against the US Dollar (USD) in line with the rally witnessed in various world currencies folowing the decision taken by the US fed to keep the interest rate unchanged.

Though the state-run banks, acting on behalf of the Reserve Bank of India (RBI), tried to stem rupee’s appreciation by dollar bidding, persistent export dollar supplies and heavy inward remittances by Non-Resident Indians helped the Indian currency to maintain its firm trend for the 11th straight week, registering a gain of seven and half paise, dealers said.

Opening on a firm note at 48.64/65, the rupee remained north-bound on strong dollar inflows and feeble import demand.

The bunched up dollar supplies, accumulated during the previous week-end holidays and weakening of the dollar in the global markets initially during the week, lifted the rupee beyond the 48.60 mark leading it to close at 48.5950/6050 on Tuesday.

The domestic unit, which slipped marginally by half a paise on Wednesday on increased dollar demand from corporates and banks due to the shift in spot date to next Monday on account of Thursday’s independence holiday, once again rallied on friday on higher dollar supply and thin demand.

The rupee closed the week at 48.57/58, the strongest level since february one this year, gaining seven and half paise from 48.6450/6550 of its previous week’s close. The Indian currency, which tested its life-time low of 49.07 on May 16 this year on border concerns, has since then appreciated by 50 paise to 48.57 while in the current fiscal it has gained 23 paise from 48.80 to 48.57.

The rupee, however, has lost 33 paise in the calendar year from 48.24 to 48.57.

RBI’s decision to relax the exchange control norms by allowing individual professionals to retain abroad 100 per cent of foreign exchange earned by them had little impact on the market as the wide gap in interest in US and India will encourage them to bring the funds to the country, a treasury head at a private brokerage firm said.

Further, the rupee’s steady strengthening against the greenback in the recent months, will also discourage them to hold on to their remittances, he added.

The rupee is expected to open firm on Monday as the unabated dollar inflows are likely to continue.

However, the fresh rise in international oil prices and the dwindling foreign fund inflows may put slight pressure on the rupee later. Besides, the market may also watch the dollar’s movement in Asian markets, a senior forex dealer said.

Forward dollar premiums, tracking the strong spot rupee and easy liquidity in the money market, moved downwards on steady receiving by nationalised banks.

The sixth-month annualised premiums which opened softer at 4.53 per cent closed week further lower at 4.39 per cent as against 4.63 per cent of the previous weekend.

In cross currency, the rupee which appreciated by 7.5 paise against the dollar, fell sharply by 93 paise against yen to 41.36, 39 paise against euro to 47.59 and 11 paise against pound to 74.53 during the week as these currencies rose sharply against the greenback after the us fed kept the interest rate unchanged at its 40 year low of 1.75 per cent.

In the international markets, most southeast Asian currencies ended the week on a positive note, aided by local factors, but a wobbly yen kept the north Asians on the defensive against the dollar.

The dollar, which fell sharply against the global currencies on Wednesday after the US fed’s decision to leave the interest rate unchanged, staged a partial recovery towards the weekend.

Meanwhile, international oil prices touched fresh three-month highs on Friday as a tightening market balance combined with fears of a US military campaign against major producer Iraq.

International benchmark brent crude oil rose 24 cents to usd 27.09 a barrel, bringing the week’s gains to nearly USD 2 while the US light crude futures moved up by 19 cents to USD 29.25. (UNI)

Chhattisgarh opens emporium, emphasis on
handicrafts industry

NEW DELHI, Aug 18: At a time when various state handicraft corporations are struggling for survival owing to economic liberalisation and decline in the inflow of foreign tourists amid threats of on Indo-Pak conflict, Chhattisgarh has recently opened its emporium here.

"Unlike other states, economic liberalisation had little impact on the handicrafts industry of Chhattisgarh and our products had great demand prior to the formation of the state in 2000," Chhattisgarh Deputy Secretary Rural Industries Niharika Wari told UNI here.

"Even when our products were sold through Madhya Pradesh emporium — we had received overwhelming response," she added.

"Although Chhattisgarh is better known for its rich mineral wealth, our handicrafts products are of world standard and have a global market," she said.

"Our products have been able to keep pace with changing times and needs," she added.

"We want to develop handicrafts industry as one of the primary industries which would provide employment to the youth of the state," Ms Wari said.

The State Government has set up training institutes for the artisans who were mostly tribals and has also formed a task force to promote tribal handicrafts, she said.

Experts from the National Institute of Fashion Technology were also helping the craftsmen in creating new designs to keep pace with changing times, she said adding that "we are also hiring designers from other Indian states."

Infact, Chief Minister Ajit Jogi participated in the day to day functioning of the industry and was keen to develop it as a core industry, Ms Wari said. "Although there has been a decline in flow of foreign tourists in view of the current Indo-Pak tensions, we are not solely dependent on foreigners," Ms Wari said, adding that the domestic tourists were also being targetted.

An elaborate publicity drive was also being undertaken, Ms Wari who is also the Chhattisgarh Deputy Resident Commissioner said.

The emporium — "Shabari" — was set up in Delhi to provide a window to the artisans to reach out to the masses of the capital, she pointed out.

"We want to provide our craftsmen with a bigger market," she said.

The emporium, which was now located in Hotel Kanishka, would be shifted to Baba Kharak Singh Marg, where other state emporia were located, she informed.

"Talks are on and a bigger place would allow us to showcase a wider range of products," Ms Wari said. The items currently available at the emporium here include bell metal products, wrought iron products, tussar sarees and dress materials, "Marwahi shilp", wooden products, jute products and paintings.

Terracota and bamboo products would soon be added to the list, Ms Wari said.

The emporium is part of the "Chhattisgarh Khadi and Gramudyog Board" under the State Ministry of Rural Industry. (UNI)

Himachal Govt submits 40.8 crore project to centre

SHIMLA, Aug 18: The Himachal Pradesh Government has submitted a Rs 40.8 crore project to the Central Government for modernisation of existing ayurvedic pharmacies at Jogindernagar, Majra and Paprola in the state.

The State Government has received Rs 75 lakh from the Central Government for strengthening of ayurvedic pharmacy, Jogindernagar, and Rs 56.24 lakh for drug testing laboratory there, according to an official spokesman here.

The spokesman said the State Government was making concerted efforts to popularise "Panchkarama", an ayurvedic system of treatment applied in the country for spondilitis, arthritis, migraine and prostrate enlargement.

The Ayurveda Department had imparted training in ‘Panchkarama’ to doctors working in the state, the spokesman said.

"Panchkarma" therapy was being provided in ayurvedic hospitals at Bilaspur and Paprola and steps were being taken to popularise it in other ayurvedic hospitals in the state. Two special camps of ‘Panchkarama’ were held in shimla in which over 4,000 patients were treated through this therapy, he noted.

"Panchakarma" has been linked with tourism development in the state and a project, worth Rs 73.20 lakh, has been approved in this connection. The project will initially be started in four hotels of the Tourism Development Corporation at Jogindernagar in Mandi district, Palampur in Kangra district, Chial in Solan district and in Kullu district to give a boost to "health tourism" in the state.

The Government plans to expand the project to more hotels in phased manner. The State Government has increased the number of seats from 30 to 50 in Ayurvedic College, Paprola, and renamed it as an Institute of Post Graduate Education and Reserch in Ayurveda.

Post-graduate classes in "Kaya-Chikitsa" "Sahlya Tantra" and "Shalkya Tantra" have been started in the institute. The State Ggovernment has sent a proposal the Central Government to allow it start postgraduation classes in three additional subjects — "Ras Shastra", "Maulink Sidhant" and Drayaguna.

It has sought financial assistance of over 8.49 crore to develop this institute into a "centre for excellence in ayurvedic education and research".

The spokesman said to promote cultivation of herbs in the state, a Rs 8.27 crore "Vanspati Van Pariyozna" was being implemented with Central Government’s assistance in Chamba and Kullu districts. The Ministry of Health and Family Welfare had sanctioned Rs 5.16 crore for this project so far, he added.

Over 25 acre land has been also developed for herbal cultivation at herbal garden, Jogindernagar and more than 225 species of various medicinal plants have been conserved. Various research activities for developing agro-techniques for cultivation of medicinal plants are conducted in the garden.

Herbal gardens have been also established at Dhumera in Shimla district and Jungle-Jhalera in Bilaspur district. Training camps are being organised from time to time in different parts of the state for farmers to provide them knowhow for scientific cultivation, collection and marketing of medicinal plants.

About 28 acres of land has been acquired to set up herbal garden a Neri in Hamirpur district. The Central Government has provided Rs 8 lakh for its establishment.(UNI)

Inflation rate drops after a three-week rise

NEW DELHI, Aug 18: Arresting the three-week rising spiral, the inflation rate witnessed a wafer-thin 0.19 per cent slump to 2.66 per cent on August 3 despite the hefty hike in prices of aviation turbine fuel and plastic products while maintaining its 39-week high.

It was 2.85 per cent the week before. But it was much above the five per cent mark at 5.48 per cent during the same period last year.

The recent downturn in the inflation rate was despite the substantial hike in prices of aviation turbine fuel, plastic items, woollen yarn, solvent extracted groundnut oil, rapeseed oil, mustard seed oil, maida and cotton knitted garments.

Uneven rainfall in many parts of the country has severely affected the agriculture sector and is mainly responsible for the price rise in the consumable items. Moreover, with the introduction of the free-pricing mechanism on petroleum products in the beginning of this fiscal, the inflation rate has become somewhat dependent on fluctuations in international crude prices.

That apart, an attack on iraq by the United States would trigger a massive price hike in petro products and a consequent chain reaction in prices of consumer goods in India.

A rise in the indices for primary articles, fuel, power, light and lubricants and manufactured products led to a 0.2 per cent increase in the official wholesale price index for all commodities (base 1993-94) to 166.1 on August 3 against 165.8 in the previous week.

The final wholesale price index for all commodities (base 1993-94) was at 164.3 during the week ended june 8 against the provisional index of 163.8. The inflation rate based on final index worked out to 2.18 per cent against 1.87 per cent based on provisional index.

The index for primary articles shot up by 0.2 per cent to 173.5 from 173.1 while index for manufactured products rose by 0.3 per cent to 147.4 from 147.

With bajra becoming costlier by eight per cent, jowar by three per cent, the index for food articles, under the primary articles group, went up by 0.1 per cent to 180.4 from 180.3. But coffee became cheaper by five per cent, gram by four per cent, eggs and tea by one per cent each.

The index for non-food articles rose by 0.9 per cent to 160.8 from 159.4 because kardi seed prices climbed up by 10 per cent, groundnut by three per cent, raw cotton and castor seed by two per cent each, cotton seed, gingelly seed and linseed by one per cent each. But the niger seed prices fell by three per cent and raw rubber by one per cent.

A whopping 26 per cent hike in prices of aviation turbine fuel jacked up the index for fuel, power, light and lubricants by 0.1 per cent to 238.7 from 238.4. With solvent extracted groundnut oil prices soaring by six per cent, rapeseed oil, mustardseed oil by five per cent, maida by four per cent, rice bran oil by three per cent, oil cakes by two per cent, suji(rawa), sugar and sweetmeat confectionary and gingelly oil by one per cent each, the index for food products, under the manufactured products group, rose by 0.7 per cent to 153.9. But gur, sunflower oil and coffee powder prices declined by one per cent each.

The index for textiles went up by 0.3 per cent to 118.9 from 118.5 because woollen yarn became dearer by a hefty 22 per cent, cotton knitted garments by six per cent, viscose filament yarn by two per cent, nylon filament yarn, viscose staple fibre and hessian sacking bags by one per cent each. Texturised yarn prices, however, fell by one per cent.

A slender one per cent hike in prices of map litho paper pushed up the index for paper and paper products by 0.1 per cent to 174.4.

A steep 26 per cent rise in prices of plastic items jacked up the index for rubber and plastic products sharply by 2.6 per cent to 136.

A marginal rise in cement prices led to a 0.3 per cent rise in index for non-metallic mineral products to 140.3 from 139.9.

A two per cent drop in pipes, tubes prices and a negligible one per cent dip in zinc, tin boxes and containers prices led to a 0.1 per cent slide in the index for basic metals, alloys and metal products from 144.6.

The index for machinery and machine tools rose by 0.2 per cent to 130 from 129.8 because valve all types became dearer by a whopping 11 per cent, other pumps by three per cent and power driven pumps by two per cent.

The indices which remained unchanged at their previous week’s level were minerals, beverages, tobacco and tobacco products, wood and wood products, leather and leather products, chemicals and chemical products, transport equipment and parts. (UNI)

ICRA to announce 2nd CGR by August-end

NEW DELHI, Aug 18: Investment Information and Credit Rating Agency (ICRA) will announce its second Corporate Governance Rating (CGR) by this month-end, after having assigned the first to ITC Ltd.

"We announced the first CGR at the fag end of June and are now preparing to assign the second one by the August-end with final touches being given to the company undertaken," ICRA Managing Director P K Choudhury told UNI.

Besides, Mr Choudhury said, two other companies are in the pipeline for the CGR and the work is progressing well.

In the country’s first-ever CGR, which indicates the relative level to which an organisation accepts and follows the codes and guidelines of corporate governance practices, ICRA assigned a CGR2 rating to ITC Ltd. This implies a "high level" of assurance on the quality of corporate governance.

Citing the case of ITC, he pointed that the high level of corporate governance rating shows its transparent shareholding structure, well-structured management decision-making process with adequate delegation of powers and sound board structure and systems.

He explained that ICRA’s corporate governance rating is based on a scale of 1 to 6, with CGR1 denoting the highest rating and CGR6 the lowest.

Mr Choudhury clarified that the rating is not a certificate of statutory compliance or a comment on the rated company’s future financial performance, credit rating or stock prices.

He also made it clear that the CGR only indicates ICRA’s current opinion on the relative level to which an organisation accepts and follows the codes and guidelines of corporate governance practices.

Corporate governance practices prevalent in a company reflect the distribution of rights and responsibilities among different participants in the organisation such as the board, management, shareholders and other financial stakeholders and the policies and systems laid down and followed for making business decisions. The ICRA Managing Director said the focus of the rating agency’s CGR is on corporate’s business practices and quality of disclosure standards with respect to the requirements of regulators and interests of its financial stakeholders — shareholders, lenders and creditors.

CGR is based on the core principles of corporate governance practices laid down by the business sector advisory group of Organisation for Economic Cooperation and Development (OECD). These are: Fairness, transparency, accountability and responsibility.

The codes and standards, which are applicable, have been defined in detail in the various committees constituted by the Securities and Exchange Board of India (SEBI) and the Reserve Bank of India. (RBI).

While evaluating an organisation on the CGR scale of 1-6, the rating agency considers whether the codes and guidelines have just been followed for statutory compliance or the organisation has implemented the concept of corporate governance in spirit as well. It also benchmarks the organisations against the codes and standards of corporate governance as spelt out by the SEBI for listed companies.

Mr Choudhury said the CGR will not have any direct linkage with its conventional credit ratings.

For the CGR exercise, he pointed out that barring perusing annual and other reports, the rating agency interacts with the senior management of the company, its board of directors, key shareholders, auditors and other financial stakeholders.

He believed that the rating service will assist corporates to develop a credible opinion on its management quality and responsiveness towards the interests of all its financial stakeholders.

Though CGR is not an indicator of statutory compliance, a higher CGR rating may also improve the comfort level of the statutory authorities and regulators, he said adding that it can also be used as a check to determine the relative standing of the company with respect to the benchmarks of best corporate practices in the industry.

Mr Choudhury said ICRA provides its cgr ratings on a formal request of corporates. For withdrawal of the CGR rating, the corporate will have to provide a written request to ICRA, giving a notice period of one year, he added. (UNI)

China’a exports to India surge 24.3 pc in H1 of 2002

BEIJING, Aug 18: China’a exports to India, riding on more shipments of chemicals, machinery and TV picture tubes, surged 24.3 per cent to reach us dollar 1.09 billion during the first half of 2002, against the tardy 7.7 per cent growth of Indian exports to its neighbour, amounting to US dollar 982.54 million.

The slow growth of Indian exports to China during January-June 2002 was on account of declining shipments of marine products and cotton yarn, latest Chinese customs data shows.

However, after the slow growth of Indian exports in the first quarter of 2002, the last two months of the first half witnessed a slight rebound, trade sources said.

Indian marine exports to China fell by nearly 50 per cent from USD 51.45 million in the first half of 2001 to USD 25.77 million in the first half of 2002.

Indian exports of cotton yarn and fabric also declined by 15.6 per cent to USD 88.35 million in the first half from USD 104.68 million during the corresponding period of the previous year.

The sectors where Indian exports did well included plastics, organic chemicals and precious stones and metals.

Chinese organic chemicals exports to India during the period amounted to USD 240.25 million, up 34.6 per cent, while that of electronic/electrical machinery rose by 79.8 per cent to touch USD 202.99 million.

Chinese silk exports have also been increasing, touching USD 166.42 million, up 32.7 per cent. (PTI)

Tyre Cos slug it out to augment mkt shares

MUMBAI, Aug 18: Truck and bus tyre production is looking up in the current fiscal 2002-03, thanks to investments in the national highway project and a strong showing by the commercial vehicles sector.

Even though this segment registered a decline of three per cent in production to 84.74 lakh units in 2001-2002 from 86.11 lakh units in 2000-2001, the last quarter of the 2001-02 (January-March) showed an improvement to 21.49 lakh tyres from 20.10 lakh tyres (during Jan-March 2001).

Experts ascribe this positive trend to in-flow of funds in the national highway project, bolstered by a strong peformance by the commercial vehicles sector.

The tyre companies have now stepped on the gas in their efforts to improve their market share, during the fiscal 2002-’03. For instance, Apollo and Premier tyres increased their combined market share by two per cent to 24 per cent to aggregate 1,66,046 tyres in 2001-’02(as against 1,50,301 in 2000-01).

During this period, Ceat improved its market share by 4 per cent to 17 per cent from its previous 13 per cent, and in absolute terms to 1,20,644 tyres from 93,829 tyres in the previous year, while JK Tyres and Vikrant from 158,502 to 179,938 tyres, an increase by 3 per cent to a total of 25 per cent.

MRF, though was a slight loser. Its market share in this period fell by 3 per cent to aggregate 15 per cent as against 18 per cent in the previous year. In absolute terms, MRF’s share fell from 1,31,277 to 1,05,708 tyres in this period.

The market share of other players like Birlas remained constant at 10 per cent, while good year declined from 5 to 4 per cent and modi from 10 per cent to 3 per cent.

The latter’s plant subsequently shut down for good in that year. The truck and bus tyre segment accounts for the bulk of the industry with sales of about Rs 6,000 crore, followed by passenger cars that account for about Rs 935 crore, LCVs Rs 653 crore, tractors Rs 671 crore, motorcycles Rs 484 crore, scooter Rs 382 crore and jeeps Rs 232 crore.

There is big replacement market too, says Mr Kalyan Paul, Vice President, Marketing, Ceat Tyres. It is estimated at two thirds of the total market with the Original Equipment Manufacturers (OEM) accounting for the rest. Significantly, says Mr Paul, the replacement market provides better margins but the OEMs provide the much needed volumes.

In absolute terms, the replacement market in the bus tyre segment is of the order of 5.5 lakh, which includes about one lakh tyre sale coming OEMs and sales through state trading corporations, according to Mr Paul. Ceat which has improved its market share by 4 per cent to account for 17 per cent in 2001-02, aims to improve its market share further by about two per cent in the current fiscal, says Mr Paul. For the past three years, the tyre industry has been in the doldrums mainly due to a slower growth in the automobile sector in the wake of the recession. The tyre industry, which depends on the recovery of the automobile industry, is now showing early symptoms of a turn around.

Prompted by a strong showing from the replacement sales of passenger cars and Light Vommercial Vehicles (LCV) tyres, the domestic tyre production registered growth in 2001-02 to 74.81 lakh tyres from 68.13 lakh tyres in the previous year, while LCV tyres grew by 12 per cent from 21.08 lakh tyres to 23.52 lakh tyres.

The spurt in passenger car tyres is attributed to the replacement demand for cars bought between 1998 and 2000. As a car requires tyre replacement every three years, sector followers say the time is now ripe for those new variants of Marutis, Santros, Ikons, Matizes, Indicas bought during 1998-99 to go in for tyre replacements. (UNI)

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