Silver moves up

NEW DELHI, Sept 13: Silver moved up further on the bullion market today on increased buying by stockists on higher overseas advices and closed with handsome gains.

On the other hand, gold continued to be asked at unchanged levels as most of the traders refrained from doing business and kept their finger crossed ahead of the Bank of England gold sale.

Marketmen said a firm trend in silver in the international markets enthused trading sentiment here.

They said gold was range-bound and moved slightly up by 20 cents at 256.70 U.S. dollar an ounce following negligible support from traders.

The next gold auction by the BoE on September 21, continued to shadow the trading sentiment and gold continued to be asked in a very small range of Rs.4050 to Rs.4070 per ten gram in the last few session.

Silver .999 (ready) gained Rs.50 further at Rs.7910 per kilo on increased buying by stockists while weekly delivery 7890 per kilo on speculative support. Silver coins were unchanged at Rs.10,700/10,800 per 100 pieces.

Standard gold and ornaments were unchanged at Rs.4050 an Rs.3900 per ten gram respectively on scattered support. Sovereign was also traded at last level of Rs.3625 per piece of eight gram. (PTI)

Premier LPG to invest Rs 100 cr
on port facility development

NEW DELHI, Sept 13: Premier LPG Limited (PLL), engaged in bottling under parallel marketing in Northern India, has drawn expansion plans for investment of Rs 100 crore in developing port facilities in Gujarat for direct handling of LPG and allied products.

The investment will be spread over the next five years.

Currently, the PLL has been supplying LPG cyclinders for cooking purposes in Northern India in sizes of 11 kg, 15 kg and 17 kg and has plans to expand its network all over the country with introduction of small size cyclinders in the range of 1.7 kg, 2 kg and 4 kg also besides regular sizes under its brand name ‘Insta.’

PLL Managing Director Bhagwan Das Dhamija said in a statement here that "the company has drawn out expansion plan of investing more than Rs ten crore for new bottling plants and Rs 100 crore in developing the port facility for handling LPG and allied products."

He said the funding for the development activities will be arranged through a public issue aggregating Rs 50 crore and the rest would be covered through financial institutions and from its business associates.

"Through the expansion of network the company will capture the market of domestic as well as commercial LPG throughout the country as soon as the subsidy is abolished and price differential reduced. The Government plans to abolish subsidy on LPG upto 2002.

Moreover, the PLL is planning to set up of new bottling plant within a radius of 500 kms of its market. The company already has three bottling plants in Rajasthan at Bhiwadi, Gulabpura and Sri Ganga Nagar with a capacity of 6,000 domestic cylinders per day.

Keeping in view the price difference between subsidised cyclinders and private supplies, the company has been working at a slow pace.

The Government owned companies like IOC, BPCL, HPCL supply only 19 kg and 14 kg cyclinder for commercial and domestic use. The parallel marketing firms supply products in small sizes with attachments.

Mr Dhamija said at present over five lakhs mini cylinders are sold per month in India. Keeping in view the huge demand, PLL has decided to expand its distribution network for mini-cylinders.

The Government had opened the sector in 1993 for private companies. But the price difference was the major deterrent for these firms. The Government owned agencies were selling 14.2 kg LPG cyclinder for Rs 90 in 1993 while the private operators were charging Rs 230 for 11 kg.

Later the price difference came down as Government raised the price to Rs 162. The Government connections are mostly in major cities. The PLL is planning to tap the rural market.

At present, the company has more than 25,000 domestic connections Mr Dhamija said adding that for continuous supply of LPG, the company has tied up with Aegis, Bharat Shell and Reliance. (UNI)

BIFR getting its act together

NEW DELHI, Sept 13: Even as pressure is mounting on the Government to scrap the Board for Industrial and Financial Reconstruction, the BIFR has removed 19 of its nominees on company boards as part of getting its act together.

The BIFR intends to sack about 65 special directors by this month end who have been identified to have crossed the stipulated age of 65 years. The orders for their replacement are on their way, official sources said.

"Whenever old special directors are replaced with new, there will be improvement in the board’s surveillance over the sick companies or those who have approached the BIFR for being declared sick," sources told UNI.

The BIFR has mooted a proposal that none of its over 250 special directors appointed for monitoring the registered companies should be a practicing chartered accountant. "It will put an end to the practice of some chartered accountants bagging audit work of the company on whose board they are a BIFR nominee", they added.

The removal of 19 of its representatives from 27 sick companies and the new proposal, though claimed to be routine exercises, assumes significance in the growing din against BIFR.

In a meeting on August 30 in the banking division, Finance Ministry, under whose supervision BIFR functions, banks and financial institutions almost unanimously asked the Government to down shutters on the board, official sources said.

In the last few months, there has been a subtle shift in the approach of banks and FIS towards BIFR. In late 1998, when the BIFR had only one member (who also was on extension) on its roll against the sanctioned eight, the banks had sent a missive to the Reserve Bank of India to establish more benches for tackling the mounting pending cases.

Now when the board has six members including acting chairman P P Chauhan, the banks and FIS have asked the Government in the late August meeting to do away completely with BIFR, sources said.

"What has changed within a few months that banks and FIS are forced to demand for BIFR’s closure when they were earlier seeking strengthening the board," sources said.

On condition of anonymity, a top BIFR official claimed "given the constraints of the Sick Industrial Companies (special provisions) Act, 1985, the BIFR is functioning well".

The backlog with BIFR had increased to alarming proportions only from 1997 while earlier the pending cases were negligible. Significantly, it is since 1997 the BIFR has suffered from "depressingly low number of members".

Even now the board which handles the revival of sick companies of the entire economy is working with "only a staff strength of 100 including 50 class III and IV workers," the official said.

On the pace of cases dealt at the board, a critical factor for fast recovery of (bad) debts for banks and FIS, the BIFR official suggested increasing the board members to 12 from the current six. "afterall the costs are minimal for doubling the number of benches (each with two members) from the existing three but the speed and quality of BIFR functioning will certainly improve".

Referring to the move by the department of company affairs to set up a group on restructuring of companies, the top official said the group need not replace BIFR but both can coexist.

The group can tackle potential sick companies with their net worth partly eroded by accumulated losses while BIFR can deal with the revival of companies with negative net worth, he added.

Greater empowerment to BIFR with punitive powers on companies "with unclean hands" and better infrastructure support is the need of the hour, Mr Vivek Sibal, a leading advocate, who represents cases at BIFR said. (UNI)

ITA for beefing up of tea export

CALCUTTA, Sept 13: The Indian Tea Association has stressed a special emphasis for beefing up of export of tea in view of stiff competition in the global market and lower than estimated purchase by Russia in the current year.

The ITA in its status paper, production and export scenario for 1999 has projected a reduced figure of 185 million kgs of outmarket sales for the current year compared to 206 m kgs in 1998 due to reduction of import of Indian tea by Russia.

Despite the MoU signed between the Tea Board of India and the Russian Tea Association last year for annual offtake of 100 m kgs tea from India, Russia drastically reduced import in the opening months in 1999. The situation is by all accounts of grave concern with Russia reportedly operating at extremely restricted levels over the last few months , the status report said.

The report also stressed the need for tapping traditional markets like UAE, Egypt, the UK and Poland.

ITA envision the tea production in the country to veer round to 825 m kgs in the current year against an estimated 870 m kgs in 1998 and the domestic consumption to be around 657 m kgs this year against 640 m kgs last year.

The lower output attributed to unprecedented drought conditions in Assam and North Bengal. Adverse weather conditions in South India have resulted in a poor start for growing tea in the country the status report said.

With poor start at the national level, the Indian tea production in 1999 will fall short of last year’s level unless initial setback arrested the status report said. By May of this year, production shortfall had crossed 50 m kgs due to drought situation prevailed during the pre-monsoon phase where even the bare minimum precipitation did not happen thereby affecting the vegetative process in the tea production.

On top of that India may have to import 10 m kgs of tea in 1999 against 7.5 m kgs in 1998, due to the fact that India will have to allow tea import as part of its commitment to WTO.

The Tea Board is also examining feasibility of export market in Turkmenistan where about 5000 tonnes of tea is imported per year mainly from Georgia, a cis country. Indian tea is practically non-existent among Turkmenistani tea drinkers.

The Tea Board of India had conducted a market survey there and its directors of tea promotion visited that country to explore possibilities of tea export to that country which was not cash-strapped. Turkmenpotrebsoyuz, a Government organisation, serving as a conduit to 70 per cent of tea supply, evinced interest in Indian tea. Possibilities of joint ventures had been also discussed between the officials of the two countries.

Turkmenistan mainly buys green teas and low-priced ones. The availability of high value teas is very limited, according to the Tea Board. (UNI)

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