Content on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player

Fresh Enquiry about Courses
Student Resources Centre
(for PTzens only)
Purchase SRC login ID? Click here!

PT Franchisee

Today's Hot Stories - March 17, 2011

10 Headlines for Today

(1) Raja's close aide Sadiq Batcha commits suicide
(2) Jats may call off stir today
(3) Bahrain forces overrun protest camp, six dead
(4) Cabinet nod for GST bill
(5) Gold falls to Rs 20920/kg on sluggish demand
(6) US stocks slide on world economic fears
(7) Spirited Somdev goes down fighting to Nadal
(8) Djokovic crushes doubles partner to advance
(9) Wasteful Chelsea move into quarterfinals
(10) A cup of tea improves brain power

5 Stories for Today

(1) Amend law governing broadcaster: Prasar Bharti board
(2) Japan nuclear crisis: Choppers dump water on stricken N-plant
(3) RBI set to hike rates despite Japan crisis
(4) iGate to help Japan-based staff return to India
(5) I-T gets 2k cr from Harshad assets

(1) Amend law governing broadcaster: Prasar Bharti board

The Prasar Bharati board on Wednesday made several significant decisions including suggesting changes in the legislation governing the national broadcaster and creating a new funding pattern. The board has also suggested names for the position of director general of All India Radio and Doordarshan.

In the wake of adverse remarks made by the CAG, CVC and Shunglu committee report on fixing accountability, the board has proposed extensive amendments to ensure that members including CEO can be sacked with greater ease, compared to the current procedure that requires a presidential approval and a Supreme Court inquiry into the matter.

The amendments have been sent to the I&B ministry and will have to be approved by the GoM on Prasar Bharati. In a statement, the board said that extensive amendments were necessary, "specifically in the wake of the recent past when serious reservations and questions have been raised on propriety and accountability'' by the government and other agencies.

While former Prasar Bharati CEO B S Lalli is currently under suspension, more heads are likely to roll. Another decision was approval of the new funding pattern that included the government meeting expenses related to salaries and allowances and 50% of operating cost. Prasar Bharati will have to meet 50% of operating expenses and expenses related to programming work.

(2) Japan nuclear crisis: Choppers dump water on stricken N-plant

Operators of a quake-crippled nuclear plant in Japan again deployed military helicopters on Thursday in a bid to douse overheating reactors, as US officials warned of the rising risk of a catastrophic radiation leak from spent fuel rods. While officials were scrambling to contain the nuclear crisis with a patchwork of fixes, the top US nuclear regulator warned that one reactor cooling pool for spent fuel rods may have run dry and another was leaking.

"We believe that around the reactor site there are high levels of radiation," Gregory Jaczko, head of the Nuclear Regulatory Commission, told a House Energy and Commerce subcommittee hearing.

"It would be very difficult for emergency workers to get near the reactors. The doses they could experience would potentially be lethal doses in a very short period of time."

Health experts said panic over radiation leaks from the Daiichi plant was also diverting attention from other threats to survivors of last Friday's 9.0 magnitude earthquake and tsunami, such as the cold weather and access to fresh water. The head of the world's nuclear watchdog, meanwhile, said that it was not accurate to say that things were "out of control" in Japan, but the situation was "very serious", with core damage to three units at the plant, around 240 kms (150 miles) north of Tokyo.

The latest images from the plant showed severe damage to some of the buildings after several blasts. A stream of gloomy warnings and reports on the Japan crisis from experts and officials around the world triggered a swoon in global financial markets, with the Japanese yen surging to all-time highs against the dollar and all three major stock indexes slumping, on fears of slower worldwide growth.

Japanese finance Minister Yoshihiko Noda on Thursday blamed speculation for the yen's surge and repeated his warning that he would closely watch market action.

Japan's Nikkei average slumped on opening on Thursday, and an hour after opening, was down nearly 4 percent. G7 finance ministers will hold a conference call later on Thursday to discuss steps to help Japan cope with the financial and economic impact of the disaster, a source said.

Japan's government said that radiation levels outside the plant's gates were stable but, in a sign that it was overwhelmed, appealed to private companies to help deliver supplies to tens of thousands of people evacuated from around the complex. "People would not be in immediate danger if they went outside with these levels. I want people to understand this," chief cabinet secretary Yukio Edano told a news conference, referring to people living outside a 30-km (18-mile) exclusion zone. Tokyo Electric Power Co. (TEPCO) officials said that bulldozers attempted to clear a route to the reactor so fire-trucks could gain access and try to cool the facility using hoses.

Company officials also said that they had high hopes of getting limited power to the facility to help pump water needed to cool reactors and the spent fuel rods that have been overheating.

High radiation levels on Wednesday prevented a helicopter from dropping water into the No. 3 reactor to try to cool its fuel rods after an earlier explosion damaged the unit's roof and cooling system, but they managed on a second attempt on Thursday. The plant operator described No. 3 -- the only reactor at that uses plutonium in its fuel mix -- as the "priority". Plutonium, once absorbed in the bloodstream, can linger for years in bone marrow or liver and lead to cancer. If cooling operations do not proceed well, the situation will "reach a critical stage in a couple of days", said an official with the government's Nuclear and Industrial Safety Agency.

The situation at No. 4 reactor, where the fire broke out, was "not so good", TEPCO added, while water was being poured into reactors No. 5 and 6, indicating that the entire six-reactor facility was now at risk of overheating.

"Getting water into the pools of the No.3 and No.4 reactors is a high priority," said Hidehiko Nishiyama, a senior official at Japan's Nuclear and Industrial Safety Administration.

"It could become a serious problem in a few days," he said.

Unprecedented crisis, says emperor

Japanese Emperor Akihito, delivering a rare video message to his people on Wednesday, said that he was deeply worried by the crisis which was "unprecedented in scale".

"I hope from the bottom of my heart that the people will, hand in hand, treat each other with compassion and overcome these difficult times," the emperor said.

Panic over the economic impact of last Friday's massive earthquake and tsunami knocked $620 billion off Japan's stock market over the first two days of this week, but the Nikkei index rebounded on Wednesday to end up 5.68 percent.

The Tokyo Stock Exchange and the Financial Services Agency plan to keep the stock market open despite calls for a halt to trading, mainly from foreign financial institutions, the Nikkei business daily said.

TSE President Atsushi Saito said that the exchange "will continue to provide investors with an opportunity to trade", calling it "an important piece of social infrastructure".

"If we put a stop to trading, it will be seen as a confirmation of the concerns among foreigners and could trigger panic," a TSE official was quoted as saying by the Nikkei.

Estimates of losses to Japanese output from damage to buildings, production and consumer activity ranged from between 10 and 16 trillion yen ($125-$200 billion), up to one-and-a-half times the economic losses from the devastating 1995 Kobe earthquake.

Damage to Japan's manufacturing base and infrastructure is also threatening significant disruption to the global supply chain, particularly in the technology and auto sectors.

Embassies urge citizens to leave

Scores of flights to Japan have been halted or rerouted and air travellers are avoiding Tokyo for fear of radiation.

On Thursday, the US embassy in Tokyo urged citizens living within 50 miles (80 kms) of the Daiichi plant to evacuate or remain indoors "as a precaution", while Britain's foreign office urged citizens "to consider leaving the area".

The warnings were not as strong as those issued earlier by France and Australia, which urged nationals in Japan to leave the country. Russia said that it planned to evacuate families of diplomats on Friday.

In a demonstration of the qualms about nuclear power that the crisis has triggered around the globe, China announced that it was suspending approvals for planned plants and would launch a comprehensive safety check of facilities.

China has about two dozen reactors under construction and plans to increase nuclear electricity generation about seven-fold over the next 10 years.

Russian President Dmitry Medvedev said that nuclear power was safe provided power stations were built in the right place and designed and managed properly. Russia ordered checks at nuclear facilities on Tuesday.

In Japan, the plight of hundreds of thousands left homeless by the earthquake and devastating tsunami that followed worsened following a cold snap that brought snow to worst-affected areas. Supplies of water and heating oil are low at evacuation centres, where many survivors wait bundled in blankets. About 850,000 households in the north were still without electricity in near-freezing weather, Tohuku Electric Power Co.

said, and the government said at least 1.5 million households lack running water.

"It's cold today so many people have fallen ill, getting diarrhea and other symptoms," said Takanori Watanabe, a Red Cross doctor in Otsuchi, a low-lying town where more than half the 17,000 residents are still missing.

The National Police Agency said it has confirmed 4,314 deaths in 12 prefectures as of midnight Wednesday, while 8,606 people remained unaccounted for in six prefectures.

International frustration

In another sign of international frustration at the pace of updates from Japan, Yukiya Amano, director general of the International Atomic Energy Agency, said that he would fly to Japan on Thursday to glean first-hand information on the crisis.

Several experts said that the Japanese authorities were underplaying the severity of the incident, particularly on a scale called INES, used to rank nuclear incidents. The Japanese have so far rated the accident a four on a one-to-seven scale, but that rating was issued on Saturday and since then, the situation has worsened dramatically.

France's nuclear safety authority ASN said on Tuesday that it should be classed as a level-six incident.

At its worst, radiation in Tokyo reached 0.809 microsieverts per hour on Tuesday -- 10 times below what a person would receive if exposed to a dental x-ray. Early Thursday, radiation levels were barely above average.

But many Tokyo residents stayed indoors. Usually busy streets were nearly deserted. Many shops and offices were closed.

(3) RBI set to hike rates despite Japan crisis

Events in Japan are expected to weigh on the mind of Reserve Bank of India governor D Subbarao while charting the course of action in his mid-term policy review on Thursday. However, the majority bet continues to be on a 25 basis point hike in policy rates.

Fears that quake would push Japan, the world's third largest economy, further into recession resulted in oil prices dipping more than $4 per barrel to $97.4 on Monday. Besides, the reaction of world capital markets and the impact on capital flows and trade as also inflation are expected to be taken into account by the central bank governor.

According to Frederic Neumann, co-head of HSBC's Asia Economic Research, many Asian countries are expected to tighten policy rates in coming months. "However, financial market volatility could delay these moves well into the second half, if not further. The risk then would be that officials would need to deliver an even more forceful punch to compensate for the current hold up and bottle up rising inflation expectations".

However, bond dealers and bankers are betting on a 25 basis point hike in policy rates. "I expect RBI to increase the repo and reverse repo rate by 25 basis points, since inflation is a major concern" said Ashish Vaidya, head of forex, interest rates, currency and commodities trading at UBS India.

"I do not think a 25 basis point hike in the repo rate would push up lending rates. The market has already factored in this increase and this is being reflected in short term rates," said Keki Mistry, vice-chairman and CEO Housing Development Finance Corporation.

Economists, too, are betting on a rate hike. "Looking ahead, given the structural element in high food prices, as well as upside risks arising due to oil, we expect inflation to come in the 7-7.5% range with an upward bias through 2011. We maintain our view that the RBI will hike by an additional 50 bps in 2011, with a 25bps hike likely in its review this Thursday, and a further 50 bps in 2012," said Rohini Malkani, economist, Citi India.

Tushar Poddar, Chief India Economist, Goldman Sachs said that RBI is expected to hike policy rates by 25 bp in the March 17, meeting. "Beyond that, we believe that the RBI will hike policy rates by another 50 bp in calendar year 2011," he said. "Given the trend in WPI, inflation would likely stay around 8% for sometime. There is also considerable pipeline pressure, with petrol and diesel prices likely to be hiked in mid 2011;. we are maintaining our 25bps rate hike call, as in our opinion, the central bank does not find the trade-off between interest rate-inflation-growth compelling enough to justify strong monetary policy action" said Deutsche Bank in a report.

(4) iGate to help Japan-based staff return to India

Close on the heels of other IT companies, iGate today said that it offers to organise logistics for those of its employees in Japan who were interested in coming back to India, following the devastating earthquake and tsunami that hit the nation on March 11.

"iGATE has offered to organise logistics for those employees in Japan who are interested to travel back to India", it said. iGATE, which has an office in Yokohoma, Japan, has an overall employee base of over 100 in the country.

"All employees working out of Japan are safe and work continues to be normal", the company said in a statement. iGATE was one of the earliest entrants into the Japanese IT Services market, having established a presence there in the mid-1990s.

(5) I-T gets 2k cr from Harshad assets

In one of the biggest claims distributions in nearly two decades since the securities scam hit the market, Satish Loomba, custodian of Big Bull Harshad Mehta group (HMG), handed over a cheque for Rs 1,995.66 crore to the Income Tax department and Rs 200 crore to the SBI from the group's liquidated assets on Wednesday.

The payments, albeit interim in nature, settle the total principal claim of the Income Tax authorities of Rs 3,221 crore against the biggest share market scamster as its dues for the ten-month scam period in 1991-92. It was a banker's cheque issued in the name of SBI where the I-T department has its account. Mehta died while in jail in 2001.

The Joint Parliamentary Committee set up after the 1992 scam had estimated the scam to be worth Rs 4,400 crore. The custodian released the payments on undertakings given by the revenue department and the State Bank of India that the amounts will be brought back if so ordered by the Special Court for any adjustments. Nilima Mansukhani, chief commissioner Income Tax, said that the department would consider filing for even the interests and penalties that run up to Rs 20,000 crore for the HMG alone and cross Rs 32,000 crore for all the notified parties in the scam, including HMG.

The disbursal took place a day after the Supreme Court upheld an order of Justice D K Deshmukh of the Bombay High Court to release the amounts to I-T and SBI. The State Bank of Saurashtra had two decrees, including one for Rs 99 crore, passed in 1999 by the special court set up in 1992 for trying the scam cases. The bank had later merged with SBI; hence the money went to SBI.

Under the Special Court (trial of offences relating to transactions in securities) Act, legislated by Parliament in 1992 to deal with the extraordinary situation arising out of the scam, the main aim was to aid recovery of the huge amounts lost by banks and financial institutions. The aim was to also "restore public confidence in the financial system." Under the law, the income-tax department gets first priority over other claimants but this position is under legal challenge too. Loomba, interacting with the media after handing the cheques, said that it was "a solemn moment" but also a momentous one, as it showed that the system did work towards corrective measures.

The Act does not address losses of individuals in the scam. After the payment, the Custodian still has assets of the HMG worth Rs 500 and worth about Rs 1,000 of the other notified parties. Most of the money was got through cash, liquidation of shares (worth Rs 2,500 crore), and immovable properties. Most of Harshad Mehta's commercial properties were sold and proceeds utilized while some of his residential properties, including the building Madhuli at Worli-where he resided and a portion of it which his family still occupies-is caught in an intense legal battle over its sale. The Big Bull also had residential properties at Bandra and Charni Road.

There could be more of HMG assets, currently contested, that could come into the Custodian's kitty. This could be worth Rs 920 crore and include assets worth Rs 750 crore belonging to Harshad Mehta's mother Rasila and sister-in-law Rina, officials said. Loomba said that after I-T's claims, the banks and financial institution get next priority and only after that could other claimants line up. The main dues of I-T have now been cleared. "The SBI received Rs 600 crore earlier. The earliest order of decree gets distributed first," said Loomba. The other big claimant is Standard Chartered, with its pending claim of Rs 500 crore.

© Copyright. All Rights reserved. PT Education and Training Services (Pvt) Ltd. 2017-19 For PT staff : WebMail | DPR