NEWS – AUGUST 2008
- TRAI’s Crossholding Norms May Lead To Restructuring In Tam
The Financial Express, Friday, August 01, 2008 - Stage Set For Telecom Policy Initiatives
The Hindu Business Line,Friday,August 01, 2008 - Raja Poised To Unveil Second Generation Telecom Reforms
The Financial Express, Friday, August 01, 2008 - DOT To Grant 2 Licences For Number Portability
The Business Standard, Friday, August 01, 2008 - Govt Confident Of Support For Key Bills: Chidambaram
The Hindu Business Line,Friday,August 01, 2008 - Regulators Seek Review Of Credit Rating Agencies’ Role
Business Standard, Friday, August 01, 2008 - Bring In More Competition In Highways, Airport: CCI To Govt
Live mint, Monday, August 04, 2008 - Allow Virtual Mobile Operators: TRAI
The Business Line, Wednesday,August 06, 2008 - Ease Regulations for NBFCS, says FICCI
The Financial Express, Wednesday, August 06, 2008 - Dish TV Offer Must Specify Scheme: MRTPC
The Business Line, Thursday, August 07, 2008 - TRAI Nod for Mobile Virtual Network Operators
The Economic Times, Thursday, August 07, 2008 - Power Projects in for Cost Squeeze
The Business Line, Thursday, August 07, 2008 - Govt not in favour of windfall tax on oil & gas cos’ profits
The Financial Express, Friday, August 08, 2008 - Big-ticket M&AS may skip the second half
The Financial Express, Saturday, August 09, 2008 - Plan panel wants framework for all PPP projects to bring in more clarity
The Financial Express, Saturday, August 09, 2008 - Draft Bill suggests more teeth for coal regulator, penalty for defaulters
Financial Express, Monday, August 11, 2008 - Infrastructure Cos Protest MNCS Cornering First-Time Projects
The Economic Times, Tuesday, August 12, 2008 - Tasks ahead for the insurance regulator
The Business Line, Tuesday, August 12, 2008 - PM panel for restricting LPG, kerosene only to BPL families
Business Standard, Tuesday, August 12, 2008 - PM panel sees growth at 7.7 %
The Business Standard, Wednesday, August 13, 2008 - Govt Mulls Common Appellate Tribunal For Financial Services
The Hindu Business Line, Wednesday, August 13, 2008 - Govt may cap prices for short-term power deals
The Business Standard, Wednesday, August 13, 2008 - Centre clears modernisation of Chennai, Kolkata airports
The Hindu, Friday, August 15, 2008 - Airfares Outpace Fuel Cost Hike
The Business Standard, Saturday, August 16, 2008 - ISO rejects appeals against Microsoft’s OOXML format
The Business Standard, Sunday, August 18, 2008 - Govt to take PPP route for cruise tourism
The Business Standard, Sunday, August 18, 2008 - CCI role in retail goods pricing sought
The Financial Express, Sunday, August 18, 2008 - TRAI seeks regulation over television content
The Business Line, Wednesday, August 20, 2008 - Powermin proposes PPP model to achieve 11th plan capacity target
The Financial Express, Wednesday, August 20, 2008 - You can soon pick your best STD plan
The Financial Express, Wednesday, August 20, 2008 - ICAI, Infy To Study Norms To Counter Cartelisation
Financial Express, Wednesday, August 20, 2008 - 11th Plan Power Target Likely To Be Missed Too
Business Standard, Wednesday, August 20, 2008 - GSM players lose case & money
Financial Express, Friday, August 22, 2008 - The next wave in Telecom
The Hindu, Saturday, August 23, 2008 - Talks of zero-regulation international aviation in air
The Economic Times, Monday, August 25, 2008 - New law to speed up big biz deals
The Business Standard, Tuesday, August 26, 2008 - IRDA sets ceiling on insurance commission
The Financial Express, Thursday, August 27, 2008 - Govt to set up regulator for airport services
The Hindustan Times, Friday, August 29, 2008
TRAI’s Crossholding Norms May Lead To Restructuring In Tam
The Financial Express, Friday, August 01, 2008
In the event of the Telecom Regulatory Authority of India’s (Trai’s) recommendation on crossholding in TRP business getting a nod from the government, the largest rating agency in the country by market share, TAM Media Research Ltd, may have to look at restructuring its ownership pattern. Trai, in its recent recommendation on TRP, has held that there should be no crossholding between the rating agencies and the broadcasters, advertisers and the advertising agencies.
Further, to curb monopolies and foster healthy competition among rating agencies, Trai has also inserted a clause among its recommendations that no single company/ legal person, either directly, or through its associates, shall have substantial equity (more than 10%) holding in more than one rating agency. This is in tandem with the regulatory framework in the telecom space, where a service provider is not allowed to hold over 10 % stakes in a competing company within a circle.
Stage Set For Telecom Policy Initiatives
The Hindu Business Line, Friday, August 01, 2008
The Communications and IT Minister, Mr A. Raja, is expected to announce major policy initiatives for the telecom sector on Friday including guidelines for third generation mobile, pricing for excess spectrum for existing mobile operators, introduction of mobile number portability, new schemes under the Universal Services Obligation and a policy for rolling out wireless broadband services using technologies.
These policy measures, in the making for more than a year, will bring far reaching changes to the telecom sector. The biggest gainers will be consumers who can expect high speed data connectivity on mobile devices, better quality of services, superior connectivity in rural areas and interesting value-added services. The policy to utilise Universal Services Obligation fund, will be aimed at bringing communications services to the rural areas.
Raja Poised To Unveil Second Generation Telecom Reforms
The Financial Express, Friday, August 01, 2008
The UPA government will now be fast-tracking what could be branded the “second generation” telecom reforms, most of which have been lingering on for sometime. Cleaning up the 2G spectrum space by levying an acquisition charge beyond 6.2 MHz, devising the mechanism for mobile virtual network operator (MVNO), spectrum trading, port charges for mobile number portability (MNP), un-bundling of start-up spectrum from telecom licenses will form part of the reforms agenda.
However, the long-awaited carrier access code (CAC), which allows subscribers to choose their long distance operator, is likely to be dropped, as it is not being seen as relevant any more. Communications and IT minister, A Raja, who will kick-start the process on Friday by announcing the 3G policy, will touch upon the other issues as well by laying a clear roadmap.
DOT To Grant 2 Licences For Number Portability
The Business Standard, Friday, August 01, 2008
The government has decided to grant licenses to two mobile number portability (MNP) service providers in the country, who will act as a clearing house to allow mobile users to seamlessly change their operator without changing their number. A decision to this effect has been taken by the Department of Telecommunications (DoT) and is likely to be announced by Communications Minister A Raja on Friday, sources told Business Standard.
However, portability services, which were earlier expected to be launched by the end of the year in the four metros —Delhi, Mumbai, Kolkata and Chennai — as well as Tamil Nadu, have now been delayed till February or March 2009 (the DoT has said that it will start operations six months after the license is granted.
Govt Confident Of Support For Key Bills: Chidambaram
The Hindu Business Line, Friday, August 01, 2008
The discord among various political combines in Parliament over pushing forward economic reforms notwithstanding, the Finance Minister, Mr P. Chidambaram, has expressed confidence that he would be able to muster legislative support to ensure the passage of key financial Bills — banking, insurance and pension — in the coming days.
“Tempers are running high. Hopefully tempers will cool down. I am hopeful and confident that when things cool down, I will be able to reach out to every party in Parliament. There is virtually a consensus among all sections to push reforms forward except one who have an ideological opposition to it,” Mr Chidambaram said on the occasion of the launch of Mr Swaminathan S. Anklesaria Aiyar’s book ‘Escape from the Benevolent Zookeepers’ here today.
Regulators Seek Review Of Credit Rating Agencies’ Role
Business Standard, Friday, August 01, 2008
Move follows tight norms for raters in US, EU after global financial turmoil. With the role of rating agencies under the lens across the global, Indian financial sector regulators too have decided to review their functioning and explore the possibility of strengthening regulation. Sources said the issue has been discussed threadbare by the high-level coordination committee (HLCC) on financial markets at the last two meetings and the Securities and Exchange Board of India (Sebi) has been asked to come out with a paper on it.
“While there is neither anything wrong with our rating agencies or any suspicion of wrongdoing, the review is due to the global developments. The paper will be more like a discussion paper,” said a source close to the development. Another source said the regulators were merely discussing the possible issues that they may need to deal with.
Bring In More Competition In Highways, Airport: CCI To Govt
Live mint, Monday, August 04, 2008
Competition watchdog CCI has asked the government to amend existing rules to allow more competition in maintenance of highways and airports under the public-private-partnership model. “Several existing laws restrict or undermine competition. A review of such policies should be undertaken by the government to remove their competition-restricting effect (on the road and airport sectors),” Competition Commission of India (CCI) Director General Amitabh Kumar told PTI.
He said currently, only one private player is given exclusive rights to maintain highways for a long period to enable them recover expenses in executing the project. Kumar added that some parameters, like threshold level of traffic, should be brought in beyond which other players could also be allowed to manage these highways.
Allow Virtual Mobile Operators: TRAI
The Business Line, Wednesday, August 06, 2008
Telecom Regulatory Authority of India on Wednesday recommended that the Government allow Mobile Virtual Network Operators (MVNO) in the country. MVNOs do not own spectrum but buy capacity from existing mobile operators and then resell it under their own branding and tariffs.
The regulator suggested that there should not be any bar on the number of MVNOs . This will give consumers a much larger choice. “The introduction of MVNO is seen as a natural progression towards enhancing free market principles and contributing to the efficient use of existing telecommunication infrastructure,” TRAI said in its recommendations.
Ease Regulations for NBFCS, says FICCI
The Financial Express, Wednesday, August 06, 2008
A task force on non-banking finance institutions, set up by industry chamber Ficci, on Wednesday said the regulations for NBFCs in the country are not fit for the growth of the sector and need to be on par with those for banks. The Reserve Bank of India last week asked non-deposit taking NBFCs with assets worth more than Rs 100 crore to raise the capital to risk asset ratio (CRAR) to 12% by March 31, 2009, and 15% by March 31, 2010 to cushion against risky loans.
“In the system, everything has to play its role and should be helped to play its role. This (NBFC sector) is a weak link and has to be treated differently. It requires development-oriented regulation, but what the regulator (RBI) is doing is to strengthen the regulation without focusing on its development,” MS Verma, chairman, Ficci Task Force on NBFC, told reporters after releasing a report on the sector here.
Dish TV Offer Must Specify Scheme: MRTPC
The Business Line, Thursday, August 07, 2008
The Monopolies and Restrictive Trade Practices Commission (MRTPC) has granted interim relief to complainants against Dish TV’s free set-top box offer. The scheme that offered a free set-top box or hardware on one year’s subscription and with Rs 3,990 worth movies for download had been advertised aggressively.
Stating that Dish TV’s free set-top box advertisement would cause irreparable loss to consumers in general, the Commission had granted relief on the applications of Mr Hari Shankar and the consumer organisation, Sajag Upbhokta Shakti Sangahtan Samiti.
TRAI Nod for Mobile Virtual Network Operators
The Economic Times, Thursday, August 07, 2008
In a move expected to increase competition in the world’s fastest growing mobile market, telecom regulator TRAI on Wednesday asked the government to allow Mobile Virtual Network Operators (MVNOs), whose business model involves buying air time from existing operators and then selling it under their own brand, to launch services in India.
This will enable firms to allow to offer mobile services without owning cellular networks (radio frequencies). Companies such as the UK’s Virgin and BT Mobile and Japan’s KDDI have based their telecom strategy on the MVNO model. At present, there are 360 MVNOs operating globally.
Power Projects in for Cost Squeeze
The Business Line, Thursday, August 07, 2008
With the inflationary spiral threatening to derail project execution outlays across key infrastructure sectors, cost squeeze is the new buzzword in the power sector. The Central Electricity Regulatory Commission plans to turn on the heat on developers by proposing prudence checks through capital cost benchmarking for upcoming thermal stations and transmission projects. This comes on the heels of the Centre advocating austerity in use of land for setting up of thermal power projects.
Tackling rising project costs is expected to have a bearing on future electricity tariffs from upcoming projects. While the cost of setting up a thermal power plant has traditionally been estimated roughly at Rs 4 crore per MW, there have been rising instances of newer projects coming up across the country where the per-MW project costs are higher, with developers citing higher input costs and project execution payouts.
Govt not in favour of windfall tax on oil & gas cos’ profits
The Financial Express, Friday, August 08, 2008
Endorsing the stand taken by countries such as Britain, the government is not in favour of imposing a “windfall tax” on the profits of oil and gas companies—be it the producers or the refiners.
The much-talked about report of the committee headed by the Planning Commission member BK Chaturvedi on the financial position of oil marketing companies, in the backdrop of rising crude oil prices, has proposed levying such a tax on the oil and gas producers who were awarded exploration blocks in the pre-Nelp regime. However, the Chaturvedi committee report has recommended that refineries—in the private and public sector—be spared from levying of such a tax.
Big-ticket M&AS may skip the second half
The Financial Express, Saturday, August 09, 2008
The global credit crunch and the US economic downturn could restrict big-ticket financial buyer activity in the second half of this year, says a PricewaterhouseCoopers report. Though the total deal volume would be more or less the same as last year at over 500, in 2008, trade buyers would primarily drive the global automotive M&A activity, and financial buyers will continue to remain on the sidelines as in the first of this year, the report says.
PwC says there was a significant dip in the financial buyer activity, both in deal volume and disclosed value, during January to June. While, the financial buyer deal volume declined by 58% to 34 deals compared to 80 deals during the same period a year ago, there was a dip of 72% in the disclosed deal value at $5.9 billion.
Plan panel wants framework for all PPP projects to bring in more clarity
The Financial Express, Saturday, August 09, 2008
The Planning Commission wants all private-public-partnership projects (PPP) to come under a regulatory framework so that there is more transparency at various stages of implementation. Gajendra Haldea, principal advisor (infrastructure) of the Planning Commission, said in most of cases, the bidding process involved in a PPP has little transparency and a viability gap funding done by the central or the state government is not required.
Haldea acted as a mentor for the concession agreement between the Andhra Pradesh government and a consortium led by the Satyam group for the 71-km metro project in Hyderabad costing Rs 12,410 crore. Here the state government will receive Rs 1,240 crore instead of making a viability gap funding.
Draft Bill suggests more teeth for coal regulator, penalty for defaulters
Financial Express, Monday, August 11, 2008
The Draft Coal Regulatory Authority Bill, 2008 envisages wide ranging powers to the coal regulatory authority. The establishment of regulatory authority could lead to optimal and appropriate resource management including a regulatory mechanism to attend to all issues relevant for development of coal resources, regulation of coal price, and creating and nurturing a level playing field between the influential large public sector coal companies and the emerging small coal companies in the state-level public sector and the captive mining sector.
According to the Bill, which is in FE’s possession, the state governments will retain the authority to grant licences and mining leases in the coal sector to the applicants, while the coal regulator will authorise the entities to undertake mining operations, produce and supply coal from the mine.
Infrastructure Cos Protest MNCS Cornering First-Time Projects
The Economic Times, Tuesday, August 12, 2008
With more weightage being given to development experience – where foreign players have an edge – than domestic construction experience, foreign players have an obvious lead in the project bids being undertaken for the first time in the country such as modernisation of railway stations. While domestic firms are given an additional weight of 33% for construction experience in the country, they lose out as foreign players get a higher weight for the development work done by them.
The domestic players have less exposure in the development of such projects but have more experience in undertaking construction work on contract for similar projects abroad. The chairman of a leading infrastructure and construction firm has suggested changes to the marking scheme to avoid monopoly of foreign companies in new infrastructure projects.
Tasks ahead for the insurance regulator
The Business Line, Tuesday, August 12, 2008
The Insurance Regulatory and Development Authority (IRDA) was set up in 1999 to protect the interests of policyholders and to regulate, promote and ensure orderly growth of the insurance industry. With the opening up of the economy, a number of new players were issued licences and the IRDA played a promotional role, taking insurance even to the rural areas. It also freed general insurers from the shackles of tariff rates and ushered in the d e-tariff regime.
Consequently, fire premium rates dropped by 80-90 per cent for major industrial accounts without regard to risk factors, as private insurers were keen to grow their business at any cost. Moreover, public sector insurers had not built up reliable statistical data to help guide private insurers in fixing an equitable rate commensurate with risk.
PM panel for restricting LPG, kerosene only to BPL families
Business Standard, Tuesday, August 12, 2008
The high-powered BK Chaturvedi Committee has proposed restricting subsidised domestic cooking gas LPG and kerosene to only below poverty line (BPL) families, while pricing the same for others at market rates. “Fuel subsidies are only justified in the case of domestic petroleum fuels (kerosene and LPG) supplied to BPL families,” the BK Chaturvedi Committee report said. It proposed that smart cards be issued to BPL families for supply of subsidised kerosene in urban and semi-urban areas to cut diversion of the fuel to unintended users.
The panel also suggested a cash transfer system, whereby funds can be transferred to BPL families through a banking or postal system for purchasing of kerosene, instead of supplying the fuel much below the market price. Kerosene in India is cheaper than bottled mineral water.
PM panel sees growth at 7.7 %
The Business Standard, Wednesday, August 13, 2008
Warning that there will be no immediate respite from rising prices, the Prime Minister’s Economic Advisory Council (EAC) today projected a gross domestic product growth rate of 7.7 per cent in 2008-09, ending three years of growth in the 9 per cent range. The EAC’s forecast is lower than the recent 8 per cent estimate by the Reserve Bank of India (RBI) and in line with several other forecasts that have pegged growth at between 7.5 and 8 per cent in 2008-09.
Asked to comment on the EAC forecast, Finance Minister P Chidambaram said: “I am confident the GDP growth will be close to 8 per cent this year.” The EAC attributed the lower forecast to a sharp slowdown in agriculture and a moderation in industry growth (see table). Services sector growth, so far the mainstay of India’s recent economic boom, is also expected to slow.
Govt Mulls Common Appellate Tribunal For Financial Services
The Hindu Business Line, Wednesday, August 13, 2008
The Government is toying with the idea of putting in place a Common Financial Services Appellate Tribunal (CFSAT) to hear appeals against orders passed by various regulators in the financial sector. Any such move would push the debate forward on convergence of regulations in the financial sector and may also be a launch pad for having a common regulator in the financial sector in the long run, say financial sector observers and experts.
“We will look at morphing the existing Securities Appellate Tribunal (SAT) to a Common Financial Services Appellate Tribunal. Of course, we need to bring legislative amendments to various laws for this purpose,” a Finance Ministry official said.
Govt may cap prices for short-term power deals
The Business Standard, Wednesday, August 13, 2008
With the purchase price of short-term power showing a steep rise this year, already touching double digits in some trades, the Central Electricity Regulatory Commission (CERC) is mulling a cap on the price of such power to tame profiteering. Short-term power, defined as power purchase contracted for less than a year, accounts for 4-5 per cent of the overall market for power. Contracts are concluded either bilaterally, between sellers and buyers, or through power traders as intermediaries.
Price-capping could be a controversial move as it could choke investments in the power generation sector, according to industry officials. As a first step, the CERC will float a consultation paper on the pricing of short-term power in the next few days.
Centre clears modernisation of Chennai, Kolkata airports
The Hindu, Friday, August 15, 2008
Centre on Friday gave its approval to the modernisation of international airports in Chennai and Kolkata. The State-run Airports Authority of India (AAI) is likely to complete the work in three years, as desired by the DMK-led government in Tamil Nadu and the Left Front government in West Bengal.
This was announced by Civil Aviation Minister Praful Patel after the Cabinet Committee on Economic Affairs (CCEA) approved the projects here on Thursday. While the Kolkata airport would be developed at an estimated cost of Rs 1,942.51 crore, the Chennai airport would cost Rs. 1,808 crore. The Kolkata project would be completed within 30 months of the award of the contract and the one in Chennai in 26 months.
Airfares Outpace Fuel Cost Hike
The Business Standard, Saturday, August 16, 2008
The increase in airfares on most routes across the country has been much sharper than the rise in fuel costs for airlines in the past four months. Aviation turbine fuel (ATF) prices increased by 34 per cent whereas fares – on an average across the country – shot up by more than 65 per cent. Since fuel accounts for about 45 per cent of the total costs, the actual impact on airlines, in terms of increase in the cost of operation, would have been around 15 per cent. Airlines also cut capacity by 20 per cent during the period.
“There might have been a higher increase in the fares than the fuel prices in the last three or four months. However, such questions of excessive pricing would have been relevant only if companies had been in the black,” Samyukth Sridharan, chief commercial officer (CCO) of Delhi-based budget carrier Spice Jet, said.
ISO rejects appeals against Microsoft’s OOXML format
The Business Standard, Sunday, August 18, 2008
Many setbacks and months of wrangling later, software behemoth Microsoft may have reason to breathe easy. The International Organisation for Standardisation (ISO) has rejected appeals from India, Brazil, South Africa and Venezuela, challenging its ratification of the Redmond giant’s Office Open XML (OOXML) file format as an international standard.
The move will pave the way for the final publication of OOXML as an international standard, and is expected to take place within the next few weeks on completion of final processing of the document, and subject to no further appeals against the decision. The ISO had given participating countries two months to appeal against its February decision to make OOXML an international standard. In response, four national standards body members — Brazil, India, South Africa and Venezuela — did so.
Govt to take PPP route for cruise tourism
The Business Standard, Sunday, August 18, 2008
The Ministry of Shipping, Road Transport and Highways is planning to develop infrastructures at major ports, exclusively for cruise shipping, through public-private partnership (PPP). The decision comes in the wake of the Union Cabinet’s approval of the Cruise Shipping Policy of India. The Cabinet is also likely to approve three more waterways as national waterways, which would further boost cruise tourism, according to a senior official in the shipping ministry.
Though the country has 12 major ports and 185 minor ports with a 7,500-km-long coastline, the cruise industry failed to attract much attention due to lack of necessary infrastructure, government policy and taxation. Currently there are three national waterways in the country.
CCI role in retail goods pricing sought
The Financial Express, Sunday, August 18, 2008
The government has acknowledged that market forces are the best way to ensure consumers get the cheapest price for their purchases. A high-powered government committee has refused to set up additional restrictions on pricing rules for industry but has instead asked for giving additional powers to the Competition Commission of India (CCI) to make companies declare accurate prices of their products.
The committee was asked to explore if products should print the retail margins as first point price—FPP in addition to the retail price, but it has rejected the suggestion. Govinda Rao, director, National Institute of Public Finance and Policy heads the 13-member expert committee.
TRAI seeks regulation over television content
The Business Line, Wednesday, August 20, 2008
The Telecom Regulatory Authority of India wants the industry-led body, Broadcast Audience Research Council, to start its audience measurement activities by January next year with representatives from the Government. The Authority is also seeking regulation over content. “With increased convergence and the blurring of boundaries between carriage and content, the recent observations of the honourable Supreme Court on the role of media and the significant influence exercised by content on the society, the Authority strongly recommends that regulation of content should also be transferred to TRAI,” says an official release.
Although “government intervention in the form of an enactment” hasn’t been recommended, TRAI would nonetheless like government representation on the board of the industry body comprising broadcasters, advertisers and agencies.
Powermin proposes PPP model to achieve 11th plan capacity target
The Financial Express, Wednesday, August 20, 2008
The power ministry, struggling to achieve the capacity addition target of 78,700mw in 11th Plan, has proposed public private partnership (PPP) model for the power sector. The ministry’s suggestion is crucial as the private sector investment in the proposed capacity addition will be to the tune of Rs 2,36,286 crore of the total investment of Rs 10,59,113 crore.
The power ministry’s presentation (copy with FE’s) observed that given the Budget constraints and inherent inefficiencies, the public sector, too, cannot be fully relied upon and thus PPP model can be implemented. According to sources, PPP model is also important as private sector participation in distribution and generation is increasing.
You can soon pick your best STD plan
The Financial Express, Wednesday, August 20, 2008
You’ll soon get to choose the cheapest STD and ISD tariffs, irrespective of your service provider. After recommending that internet telephony be opened up, telecom regulator TRAI this week will mandate that telcos offer their subscribers the freedom to choose a carrier of their choice for making long-distance calls, whether domestic (STD) or international (ISD). This will start a new era of competition in long-distance calls, provided the government acts promptly to amend licence conditions to enable telcos comply with the TRAI directive.
What TRAI has in mind is not quite implementation of the carrier access code (CAC) project mooted several years ago. In the face of resistance by telcos to CAC and the willingness of the Department of Telecom (DoT) to play along with them, TRAI has come up with a variation. This is how it will work. Suppose, you are a Bharti subscriber and you find out BSNL is offering the cheapest long-distance tariffs.
ICAI, Infy To Study Norms To Counter Cartelisation
Financial Express, Wednesday, August 20, 2008
Accounting regulator Institute of Chartered Accountants of India (ICAI) has initiated a study that will look into the policy framework of mergers and acquisitions from the touchstone of competition laws. The move comes in the backdrop of apprehension in the government that price manipulation and cartelisation may have gripped key sectors such as cement, steel and telecom.
The regulator, at a board meeting of its core research body Accounting Research Foundation (ARF) on Tuesday, decided to study the policy that governs joint ventures, and the regulatory safeguards to counter the ills of cartelisation. The research study has been initiated as part of the regulator’s MoU with information technology giant Infosys.
11th Plan Power Target Likely To Be Missed Too
Business Standard, Wednesday, August 20, 2008
Central Electricity Authority data reveal that orders for some higher capacity (500-800 Mw) equipment have not been placed. India is set to miss the 11th Five-Year Plan’s power capacity addition target as some orders for higher-capacity equipment have not been placed yet. Experts say even if the orders are placed today, it is not possible to commission the equipment within the 43 months that remain of the current Plan period, which ends in March 2012.
The power ministry has set a capacity addition target of 78,700 Mw in the period. Orders for eight out of the 14 proposed units in the 660-Mw category and seven out of the 58 planned units in the 500-Mw category have not been placed so far, according to the Central Electricity Authority (CEA), the country’s apex power planning body. A 660-Mw unit takes around 45 months to be commissioned, while it takes around 40 months to commission a 500-Mw unit.
GSM players lose case & money
Financial Express, Friday, August 22, 2008
The GSM mobile operators like Bharti Airtel, Vodafone Essar, Idea Cellular and their lobby group, the Cellular Operators Association of India (COAI), on Friday suffered a setback with the Delhi High Court dismissing their plea against the government decision on use of dual technology a Friday’s verdict was on the earlier TDSAT decision not to stay the government’s decision in the two issues. The Telecom Disputes Settlement and Appellate Tribunal (TDSAT) will now resume hearing on the legality of the government’s decision with the final hearing on September 4. nd revised spectrum norms.
The verdict comes five months after the court reserved its judgement on one of the fiercest corporate battles fought in the telecom space. The court also levied a cost of Rs 50,000 each on the six petitioners, stating, “government decision was in tandem with the universal access service licence (UASL) and in public interest.” The money will be deposited with the Delhi High Court Legal Service Authority.
The next wave in Telecom
The Hindu, Saturday, August 23, 2008
The recommendations made by the Telecom Regulatory Authority of India (TRAI) to liberalise internet telephony within the country have raised expectations that the next wave of pro-consumer growth in the telecom sector, represented by cheaper calls, will soon begin. The spectacular rise in the number of phone connections in recent years has created a massive base for internet telephony and value-added services.
Of the 325.78 million phone connections as of June this year, 2 86.6 million are in the wireless category; the telecom regulator has assessed that 70 million mobile connections are ready for third generation (3G) service and broadband wireless access. The fast clip at which India’s mobile phone sector has grown, thanks to affordable ownership, is a well-known success story. With sustained competition, such as through internet telephony, call costs can go down further.
Talks of zero-regulation international aviation in air
The Economic Times, Monday, August 25, 2008
In a move that could set the ball rolling for further opening up of the aviation sector, civil aviation authorities from across the globe are meeting in Istanbul in October to discuss the modalities of a zero regulatory regime. Some of the key areas to be discussed during this ‘freedom summit’ are liberalising the norms for foreign direct investment (FDI), simplifying cross-border consolidation in the sector and doing away with bilateral aviation service agreements.
The meeting to be held under the banner of International Air transportation Association (IATA) is expected to stress on free market access for airlines and simpler rules for change on ownership.
New law to speed up big biz deals
The Business Standard, Tuesday, August 26, 2008
A separate law for faster enforcement of high-value business contracts is on the anvil. The aim is to boost the business and investment climate in India, a country that many perceive is bedevilled by difficulties in doing business. A panel headed by Law Secretary TK Viswanathan is currently examining problems pertaining to enforcing contracts and will recommend corrective measures aimed at speeding up the legal process in resolving commercial disputes.
Based on the recommendations of the panel, which includes representatives from the ministries of finance, commerce and industry, and corporate affairs, a draft of the proposed law will be prepared in three months.
IRDA sets ceiling on insurance commission
The Financial Express, Thursday, August 27, 2008
To prevent insurance companies from paying more commission to agents and brokers than what guidelines allow, IRDA has banned payment of any charges to intermediaries who bring business. The regulator has also rationalised various slabs of insurance commissions with new rates becoming effective from October 1.
A major change in the new regime is that there is no separate restriction on paying commission to large companies based on their paid-up capital. However, for mega risks with a large sum insured, the commission has been capped at 6.5%.
Govt to set up regulator for airport services
The Hindustan Times, Friday, August 29, 2008
The government on Friday approved amendments as suggested by a parliamentary panel in the proposed bill to set up an Airport Economic Regulatory Authority (AERA). The regulator would be mandated to create a level-playing field and foster competition among all major airports, encourage investment in airport facilities, and regulate tariffs of aeronautical services to protect passenger interests.
The amended Bill would be introduced in the coming Parliament session. It was first introduced in the Lok Sabha in September last year and referred to the departmental standing committee for further discussion. The committee recommended that the regulator should have the powers to determine tariffs for non-aeronautical services such as car parking and recreational services.