BIFR needs directors

NEW DELHI, Mar 23: Faced with a manpower crunch at the top..more

West Bengal Govt for
revival of metal box

CALCUTTA, Mar 23: The West Bengal Government has....more

Bina oil refinery project costlier by Rs 2,000 cr

BHOPAL, Mar 23: The project cost of the proposed oil refinery at..more

TN Govt urged to reduce sales tax on detergents

CHENNAI, Mar 23: The Tamil Nadu Small Scale and Tiny Soap...more

Agri pact review by WTO not to affect subsidy to farmers

NEW DELHI, Mar 23: Government has no proposal to reduce subsidies to farmers..more

Zen outpaces global
majors as best small car

NEW DELHI, Mar 23: Maruti Zen outpaced global majors in its segment..more

Precious metals
show a sign of recovery

NEW DELHI, Mar 23: The bullion market showed a sign of recovery today when both the precious metals, silver and gold, recovered on local ....more

BIFR needs directorss

NEW DELHI, Mar 23: Faced with a manpower crunch at the top, the Board for Industrial and Financial Reconstruction (BIFR) has been able to hold 611 hearings in calendar year 1998, the lowest in the last ten years.

The frequency of hearings, a benchmark for pace of work at BIFR in dealing with sick companies, is set to get worse with one more director, Mr S L Kapur who retired a few months back and is on extension till this month-end.

Then the board will be left with only two members — Mr P P Chauhan and G Narayanan — who could constitute one bench to deal with 760 pending companies, the highest backlog accumulated ever.

The restructuring body set up for sick companies in 1987 has been languishing for short of directors since late 1997 when members one after another began to retire. The Board has a sanctioned capacity of four benches with two members each and a chairman to allot cases.

"The callous attitude of the Government in the appointment of new members has left the Board with an increasing backlog," BIFR sources said.

As many as 2,502 companies have registered (including 28 in february 1999 alone) so far, while BIFR has been able to dispose off 1,742 cases, leaving a burden of 760 cases including one failed and reopened and four remanded companies.

Under the various sections of the Sick Industries Companies (Special Provisions) Act, the Board has been able to dispose off 141 cases in the whole of calendar 1998, the lowest since 1989. At its peak working capacity with four benches, the Board had disposed 231 companies in 1993 273 in 1994 247 in 1995 and 275 in 1996.

When the Board was functioning to its full capacity during 1993-96, it could hold, on an average, over 1000 hearing per year with the peak at 1,552 in 1995, against 611 hearing last year.

Another unsettling data on the sluggish pace of BIFR, sources said, is the number of cases under process. The companies under process has more than doubled to 336 in 1998 against 151 in the previous year. In fact, the cases under process were only eight in 1994 and 20 in 1996.

The Board has been able to recommend only one draft rehabilitation scheme in the entire year as against 11 in 1997. The restructuring body has so far approved 143 companies including 12 central public sector units and six state PSUs.

"The only happy party in this state of affairs are those crooked companies who do not want to pay back their dues to their creditors," sources said.

No wonder financial institutions are fuming but are helpless as their hundreds of crores of rupees are stuck in Non-Performing Assets as "sick" companies continue to enjoy the "hospitality of BIFR", they added.

According to the latest BIFR annual review report, the networth of the companies registered with the Board is Rs 12,893 crore and have an accumulated losses of Rs 30,153 crore.

The fate of 1.29 lakh workers stuck in the sick companies is also held up due to these state of affairs at BIFR, they said.

Dr Charan Wadhwa of the Centre for Policy Research said a revival scheme has to be framed for BIFR with the first step being the appointment of six full-time directors. "This would also be a step towards revival of economy", a JNU economist said. (UNI)

West Bengal Govt for revival of metal box

CALCUTTA, Mar 23: The West Bengal Government has decided to provide soft loan to the tune of Rs five crore for the revival of metal box, Industrial Reconstruction Minister Mrinal Banerjee has said.

Mr Banerjee told newsmen here, yesterday that Delhi High Court has mooted a Rs 107 crore project through the ICICI for revival of metal box company reducing the total number of units to four from nine. One of the four units are in Calcutta.

He said the High Court had asked the State Government whether it would provide a soft loan for the revival of the company.

The Minister said the State Government had agreed to provide the soft loan but with certain conditions. The State Government would give the soft loan three months after the opening of the unit and should have a representative in the Board, he said.

He said as per the revival package Rs 43 crore would be arranged by selling the company’s land in Mumbai, while Rs 15 crore from selling assets. Besides, the promoters would provide Rs 30 crore. (UNI)

Bina oil refinery project costlier by Rs 2,000 cr

BHOPAL, Mar 23: The project cost of the proposed oil refinery at Bina, a joint venture of India and Oman, has shot up by Rs 2,000 crore with the Gujarat Government dragging its feet on giving environmental clearance for laying a 16 km crude oil pipeline.

The project to be set up at Agasod near Bina in Sagar district of Madhya Pradesh, has been waiting to get a green signal for laying seven kms and nine kms long pipeline in sea and soil respectively, ever since the foundation stone was laid by the then Prime Minister P V Narasimha Rao about four years ago.

Official sources told here that the delay has led to cost overruns by about Rs 2,000 crore to the present estimates of Rs 7,400 crore from its original cost of Rs 5,400 crore. Such a huge price annual escalation by Rs 500 crore may force the authorities concerned to consider winding up the project, the sources claimed.

The sources said the entire project has run into rough weather as the project implementation could start only after receiving necessary clearances.

The sources claimed that the present delay was irrational as another company has already laid a pipeline in the same area.

A 940 kms cross-country crude oil pipeline, with intermediate booster pumping stations, is to be constructed from Agasod to Vadinar, located in coastal area in Jamnagar district of Gujrat. Of this, 430 kms pipeline is proposed in Madhya Pradesh while the remaining 510 kms is to be in Gujrat.

As per the project proposal, crude oil from oman will be brought by ship to the sea near Vadinar in Jamnagar district of Gujarat from where it will be carried to agasod through the pipeline. Out of this, the crude oil will pass through a seven kms long pipeline to be laid in the sea.

"The Gujrat Government has been dilly-dallying with the project on the pretext of wildlife conservation," the sources said. Under no circumstances this 16 kms long pipeline could be diverted through some other place as experts have said that such a move would not be technically feasible, they added.

During his visit to Oman in September last year, Prime Minister Atal Behari Vajpayee had assured that all the approvals related to the project would be cleared within 45 days as no technical hindrance was existing for its approval.

Asked about the attitude of the Oman Government following the four-year delay in the project, the sources said the Omani Government has exhibited a positive attitude so far. But it might retract from the project if the delay continued.

Pointing out that Bharat Oman Refineries Limited (BORL) was a joint venture company promoted by Bharat Petroleum Corporation Limited (BPCL) and the Oman Oil Company Limited (OOCL), the sources said the partners have an equity shareholding of 26 per cent each in this company. This unnecessary delay would send wrong message to foreign capital investors, the sources said.

The project which was supposed to be completed by 2002 will now take more four years for its completion due to the delay caused by the Gujrat Government, the sources said.

The project will not only benefit the backward Bundelkhand area of Madhya Pradesh but its petroleum-based products will save a lot of foreign exchange for the country, the sources said.

On its completion, the project is expected to produce six Million Metric Tonnes Per Annum (MMTPA), petroleum-based products including Liquified Petroleum Gas (LPG), NAPHTHA, Motor Spirit (MS), Aviation Turbine Fuel (ATF), Superior Kerosene Oil (SKO), High Speed Diesel (HSD), fuel oil, bitumen and sulphur.

Bharat Oman Refineries Limited has also signed a Memoranda of Understanding (MoU) with the companies of United States, Holland and France to work on the project.

The project so far incurred an expenditure of about Rs 150 crore for wire-fencing and for laying a 7.5 kms long road from the highway to the project site, the sources added. Also about 3000 acres of land has also been acquired and compensation distributed to the affected people concerned. (UNI)

TN Govt urged to reduce sales tax on detergents

CHENNAI, Mar 23: The Tamil Nadu Small Scale and Tiny Soap and Detergent Manufacturers’s Association has urged the State Government to reduce the sales tax on detergents from the existing 16 per cent to four per cent and enable them to compete with multinational giants.

Association president K Sundaram told newsmen here last evening that more than 100 Small Scale Units had already become sick and downed shutters unable to face the stiff competition and if the Government did not bring down the sales tax rate, the remaining 300 units might also be forced to close down throwing more than 5,000 people out of employment.

He said the Small Scale Units which cater to 30 per cent of the market in the state, were finding it difficult to survive as the sales tax was uniform both to the multinational giants and small scale units.

While the Linear Alkyl Benzine (LAB), the major raw material in detergent, was made available to the Small Scale Units by the Tamil Nadu petro chemicals at a rate of Rs 55 per tonne, the giants could get the same at the rate of Rs 30, he pointed out.

He argued that the Government would not lose revenue by reducing the tax as the Small Scale Units would step up production. This would also facilitate generation of more employment opportunities, especially in the rural areas, he added. (UNI)

Agri pact review by WTO not to affect subsidy to farmers

NEW DELHI, Mar 23: Government has no proposal to reduce subsidies to farmers during review of the World Trade Organisation (WTO) agreement on agriculture due this year-end, though it would seek a cut in subsidies being extended by European Union and Japan for agriculture exports.

There is no proposal to cut incentives for farmers in view of review of the WTO agreement on agriculture. Maybe, there could be review of subsidies on fertiliser and power due to internal pressures. Generally we can afford to raise other subsidies under the agreement, Commerce Secretary P P Prabhu told the national conference on agriculture for kharif campaign 1999 here today.

On the other hand, India would demand reduction of subsidies by European Union (EU) to growers, who were getting incentives to the tune of 100 million dollars, he said.

EU, Japan and US all maintain a high level of subsidy for agriculture, Prabhu said.

Responding to fears of participants in the conference that India could be under pressure to reduce its tariff from levels currently committed (bound rates) by it in the agriculture agreement, he said India had committed to bind its tariff rates upto 100 per cent for primary commodities, 150 per cent for processed food and 300 per cent for oilseeds.

In some cases, we are well protected, he said, adding India would either seek unlimited market access or sharp reduction in tariff rates in case of pressure to reduce the bound rates. (PTI)