Judge who ruled in Mordechai Yehudai’s favour said prisoners had the right to sue authorities
JERUSALEM: An Israeli judge has ordered the country’s prison authority to pay an inmate over $1,000 (Rs 39,000) in compensation after he complained of having to share a cell with cockroaches.
Mordechai Yehudai filed a lawsuit complaining of poor hygiene, a lack of fresh air, broken windows and inmates who smoke in a handful of cells, a spokeswoman for the Israel Prisons Service said “The Prisons Service mistreated the plaintiff in a number of ways, including ... broken windows, cockroaches as well as incarceration with smokers,” judge Irit Cohen wrote in her verdict, according to newspaper Yedioth Ahronoth.
The spokeswoman said the inmate’s cell would be cleaned up. Yehudai has been held in three different prisons and has had complaints about conditions in all of them.
“Prisoners have the right to sue us whenever they see fit and we comply with the court’s rulings,” she said.
Thursday, December 13, 2007
Friday, December 7, 2007
DoT set to issue LoIs to 16 cos for kicking off mobile services
THE department of telecom (DoT) is set to issue letters of intent (LoIs) to 16 companies for starting mobile services. These include ByCell, Swan, Cheetah, S Tel, Parsvnath, Datacom, Unitech, Shyam, BPL Mobile and Indiabulls.
The LoIs to all these companies, which have applied for licences before September 25 this year, will be issued within the next couple of days, sources close to the development told ET. Each company will have to pay Rs 1,651 crore fee for a pan-India licence (less if it has applied only for some circles), and wait in queue for spectrum, which will be allotted once the defence forces vacate a part of the spectrum they currently occupy.
Commercial services can be launched only after spectrum is allocated. Each LoI holder, after it pays the licence fee, will be entitled to 4.4 MHz of GSM spectrum per circle, subject to availability. The LoIs and the licence fee deposit will guarantee these companies a place in the queue for spectrum, and will possibly result in their playing a more active role in the hectic lobbying on the spectrum issue.
LoI holders, on their part, will face a piquant choice. The licence fee they have to shell out will not guarantee when spectrum will be allotted. At the same time, they are aware that once spectrum is allotted, their investment could be worth several thousand crores and there is nothing to prevent them from selling it to some other party.
Under the first-come-first-serve policy, three operators — Idea, Aircel, Vodafone and Maxis — who have already been allotted licences but are waiting for spectrum to launch services, will be placed ahead of these 16 companies in the queue. Idea is awaiting spectrum in two circles, Aircel in seven circles and Vodafone in six circles.
Forty-six companies had applied for licences before the October 1, 2007 deadline announced by DoT. Big names such as AT&T, Sterlite, Videocon, DLF, Ispat and Moser Baer, which have applied after September 25, failed to make it in time.
Sources said many players, among the remaining 26 companies that had applied after September 25 (but before October 1), are planning to move court challenging DoT’s decision to process applications received only before September 25.
DoT has already clarified that the remaining applications will be processed at a later date. “The procedure for processing the remaining applications will be decided later if any spectrum is left available after processing the applications received up to September 25, 2007,” communications minister A Raja told Prime Minister Manmohan Singh, in a communication last month.
Mr Raja has also told the prime minister that despite his ministry’s decision to continue with the first-come-first-serve policy for awarding new licences, it will be possible to accommodate many new players. He has pointed out that while DoT has earmarked about 100 MHz of spectrum for 2G services, so far a maximum of 35 MHz to 40 MHz has been allocated to telecom companies.
Existing telcos also in LoI list
“The remaining 60-65 MHz, including spectrum likely to be vacated by defence services, is still available for 2G services. Therefore there is enough scope for allotment of spectrum to few new operators even after meeting the requirements of existing operators and licensees. Waiting for spectrum for long after getting licence is not unknown to the industry....,” Mr Raja had added.
Many existing operators seeking a pan-India footprint are in the list of 16 companies who will be issued LoIs. These include Tatas for 3 circles, Idea Cellular for 9 telecom circles, Spice for 20 circles and HFCL for 21 circles. While the licence entitles that each player (on the basis of the queue), will be given 4.4 MHz of GSM spectrum per circle to launch operations, many companies heading the queue have already approached the DoT demanding that they be granted 6.2 MHz as start up radio frequencies.
Apart from existing operators, the queue for licences is as follows: ByCell for five circles, Tata Teleservices (3 circles), Idea (9), Spice (20), Swan (2) and Cheetah (14) (Reliance holds stake in Swan and Cheetah), HFCL (21), S Tel (22), Parsvnath (22) Datacom Solutions (22), Ruiasowned BPL mobile (21), Oswals (22), Unitech (8), Shyam (21) and Indiabulls (22).
The LoIs to all these companies, which have applied for licences before September 25 this year, will be issued within the next couple of days, sources close to the development told ET. Each company will have to pay Rs 1,651 crore fee for a pan-India licence (less if it has applied only for some circles), and wait in queue for spectrum, which will be allotted once the defence forces vacate a part of the spectrum they currently occupy.
Commercial services can be launched only after spectrum is allocated. Each LoI holder, after it pays the licence fee, will be entitled to 4.4 MHz of GSM spectrum per circle, subject to availability. The LoIs and the licence fee deposit will guarantee these companies a place in the queue for spectrum, and will possibly result in their playing a more active role in the hectic lobbying on the spectrum issue.
LoI holders, on their part, will face a piquant choice. The licence fee they have to shell out will not guarantee when spectrum will be allotted. At the same time, they are aware that once spectrum is allotted, their investment could be worth several thousand crores and there is nothing to prevent them from selling it to some other party.
Under the first-come-first-serve policy, three operators — Idea, Aircel, Vodafone and Maxis — who have already been allotted licences but are waiting for spectrum to launch services, will be placed ahead of these 16 companies in the queue. Idea is awaiting spectrum in two circles, Aircel in seven circles and Vodafone in six circles.
Forty-six companies had applied for licences before the October 1, 2007 deadline announced by DoT. Big names such as AT&T, Sterlite, Videocon, DLF, Ispat and Moser Baer, which have applied after September 25, failed to make it in time.
Sources said many players, among the remaining 26 companies that had applied after September 25 (but before October 1), are planning to move court challenging DoT’s decision to process applications received only before September 25.
DoT has already clarified that the remaining applications will be processed at a later date. “The procedure for processing the remaining applications will be decided later if any spectrum is left available after processing the applications received up to September 25, 2007,” communications minister A Raja told Prime Minister Manmohan Singh, in a communication last month.
Mr Raja has also told the prime minister that despite his ministry’s decision to continue with the first-come-first-serve policy for awarding new licences, it will be possible to accommodate many new players. He has pointed out that while DoT has earmarked about 100 MHz of spectrum for 2G services, so far a maximum of 35 MHz to 40 MHz has been allocated to telecom companies.
Existing telcos also in LoI list
“The remaining 60-65 MHz, including spectrum likely to be vacated by defence services, is still available for 2G services. Therefore there is enough scope for allotment of spectrum to few new operators even after meeting the requirements of existing operators and licensees. Waiting for spectrum for long after getting licence is not unknown to the industry....,” Mr Raja had added.
Many existing operators seeking a pan-India footprint are in the list of 16 companies who will be issued LoIs. These include Tatas for 3 circles, Idea Cellular for 9 telecom circles, Spice for 20 circles and HFCL for 21 circles. While the licence entitles that each player (on the basis of the queue), will be given 4.4 MHz of GSM spectrum per circle to launch operations, many companies heading the queue have already approached the DoT demanding that they be granted 6.2 MHz as start up radio frequencies.
Apart from existing operators, the queue for licences is as follows: ByCell for five circles, Tata Teleservices (3 circles), Idea (9), Spice (20), Swan (2) and Cheetah (14) (Reliance holds stake in Swan and Cheetah), HFCL (21), S Tel (22), Parsvnath (22) Datacom Solutions (22), Ruiasowned BPL mobile (21), Oswals (22), Unitech (8), Shyam (21) and Indiabulls (22).
Thursday, December 6, 2007
Airlines told to clear air on tax
Govt Wants ‘Tax’ Component In Fares Returned In Case Of Cancellation
ADOPTING a pro-consumer stand, the government has asked airlines to come clean on the ‘tax’ component in their tariffs. The amount described as tax should be deposited with the government or returned to passengers in case of cancellation, airlines like Jet Airways, Kingfisher, Air Deccan, SpiceJet, JetLite and IndiGo have been told.
The government’s call for transparency in air fares follows growing complaints from passengers about the ‘taxes’ paid by them. Almost all airlines show fuel surcharge — which now stands at Rs 1,650 — under the head of ‘taxes and levies’ though this amount is not deposited with the government. It’s the same with the Rs 150 congestion surcharge.
The actual amount passed on to the government is only the passenger service fee (PSF) of Rs 225 per sector. Therefore, passengers have complained that they are forced to pay Rs 2,025 under the head of ‘taxes and levies’ while the government charges only Rs 225 as PSF.
It appears some airlines are using the ambiguity to enrich themselves in case a ticket is cancelled. Only the PSF of Rs 225 is returned in full while the fuel surcharge and congestion surcharge are treated as part of the fare — subject to deductions and, in some cases, forfeiture. This is the reason why the civil aviation ministry has cracked the whip now. The move comes days after ET highlighted how passengers were being taken for a ride.
The ministry has written to airlines to ensure transparency in mentioning tax and fare components on every ticket. While two private airlines were the first to receive the letter, similar communications have been sent to others.
“We have found that airlines are printing only two components — basic airfare and tax on their tickets. It doesn’t clarify whether PSF and fuel surcharge are included in the fare or have been clubbed under the heading of tax. We have hence asked the airlines to clarify how much tax they are collecting on behalf of the government and whether the amount shown under the heading of tax is being deposited with the government,” an official in the ministry of civil aviation told ET.
“A tax is a state matter and the airlines have no business to deal with it,” he added.
Airlines show fuel surcharge as tax on their tickets but don’t refund it when a passenger gets his ticket cancelled.
UNFARE SNAG
CHARGES
Airlines show fuel & congestion cess under ’taxes and levies’, but don’t deposit them with the government
Actual amount
passed onto govt is only passenger service fee of Rs 225 On cancellation, only PSF of Rs 225 is returned in full while fuel and congestion cess are treated as part of fare, subject to deductions or forfeiture
RESPONSE
Kingfisher: We mention PSF, fuel and congestion charge under tax and levies. Hence, there is no question of misleading passengers
Jet Airways: We print fuel cess and PSF together as tax on tickets as they don’t have separate columns
SpiceJet: If fuel & congestion surcharge are displayed as tax on our website, we will take corrective action
Kingfisher denies govt allegation
DUE to the airline’s tactical way of clubbing the fuel surcharge under the head of tax, passengers don’t ask for a refund of fuel surcharge, assuming it goes to the government exchequer.
Kingfisher in its reply to the civil aviation ministry said it was not clubbing fuel surcharge with tax. “We mention fuel surcharge, tax and congestion surcharge under the heading of tax and levies and hence, there is no question of misleading the passenger,” said Kingfisher executive VP and CFO A Raghunathan. “We print fuel surcharge and PSF together as tax on the tickets as there are no separate columns for the two,” said Jet Airways ED Saroj K Datta. Air carriers print Rs 2,025 as total tax on the tickets. While only Rs 225 is the tax component which goes to the government, the rest goes to the airlines.
ADOPTING a pro-consumer stand, the government has asked airlines to come clean on the ‘tax’ component in their tariffs. The amount described as tax should be deposited with the government or returned to passengers in case of cancellation, airlines like Jet Airways, Kingfisher, Air Deccan, SpiceJet, JetLite and IndiGo have been told.
The government’s call for transparency in air fares follows growing complaints from passengers about the ‘taxes’ paid by them. Almost all airlines show fuel surcharge — which now stands at Rs 1,650 — under the head of ‘taxes and levies’ though this amount is not deposited with the government. It’s the same with the Rs 150 congestion surcharge.
The actual amount passed on to the government is only the passenger service fee (PSF) of Rs 225 per sector. Therefore, passengers have complained that they are forced to pay Rs 2,025 under the head of ‘taxes and levies’ while the government charges only Rs 225 as PSF.
It appears some airlines are using the ambiguity to enrich themselves in case a ticket is cancelled. Only the PSF of Rs 225 is returned in full while the fuel surcharge and congestion surcharge are treated as part of the fare — subject to deductions and, in some cases, forfeiture. This is the reason why the civil aviation ministry has cracked the whip now. The move comes days after ET highlighted how passengers were being taken for a ride.
The ministry has written to airlines to ensure transparency in mentioning tax and fare components on every ticket. While two private airlines were the first to receive the letter, similar communications have been sent to others.
“We have found that airlines are printing only two components — basic airfare and tax on their tickets. It doesn’t clarify whether PSF and fuel surcharge are included in the fare or have been clubbed under the heading of tax. We have hence asked the airlines to clarify how much tax they are collecting on behalf of the government and whether the amount shown under the heading of tax is being deposited with the government,” an official in the ministry of civil aviation told ET.
“A tax is a state matter and the airlines have no business to deal with it,” he added.
Airlines show fuel surcharge as tax on their tickets but don’t refund it when a passenger gets his ticket cancelled.
UNFARE SNAG
CHARGES
Airlines show fuel & congestion cess under ’taxes and levies’, but don’t deposit them with the government
Actual amount
passed onto govt is only passenger service fee of Rs 225 On cancellation, only PSF of Rs 225 is returned in full while fuel and congestion cess are treated as part of fare, subject to deductions or forfeiture
RESPONSE
Kingfisher: We mention PSF, fuel and congestion charge under tax and levies. Hence, there is no question of misleading passengers
Jet Airways: We print fuel cess and PSF together as tax on tickets as they don’t have separate columns
SpiceJet: If fuel & congestion surcharge are displayed as tax on our website, we will take corrective action
Kingfisher denies govt allegation
DUE to the airline’s tactical way of clubbing the fuel surcharge under the head of tax, passengers don’t ask for a refund of fuel surcharge, assuming it goes to the government exchequer.
Kingfisher in its reply to the civil aviation ministry said it was not clubbing fuel surcharge with tax. “We mention fuel surcharge, tax and congestion surcharge under the heading of tax and levies and hence, there is no question of misleading the passenger,” said Kingfisher executive VP and CFO A Raghunathan. “We print fuel surcharge and PSF together as tax on the tickets as there are no separate columns for the two,” said Jet Airways ED Saroj K Datta. Air carriers print Rs 2,025 as total tax on the tickets. While only Rs 225 is the tax component which goes to the government, the rest goes to the airlines.
Tuesday, December 4, 2007
SOFT SKILL DELEGATING
No manager is an island. Even though others may have a different approach or standards, you’re setting yourself up to fail if you think you have to do everything yourself. Accept that in today’s interdependent world, there is a shared responsibility for getting things done. It’s not all down to you! Delegation is a very helpful aid for succession planning, personal development - and seeking and encouraging promotion. Here are some steps of successful delegation
Delegate, don’t abdicate: Remember if things go wrong, it’s ultimately your fault! Assess the risk of failure before you decide to delegate a task, and manage any risk appropriately. The only person you can blame is you, for not effectively delegating the task at the beginning. And you never know, they might even do it better than you!
Crystal clear tasks: If you can’t define the task to be delegated, it isn’t ready for delegation. Good tasks to delegate are; Specific, Measurable, Achievable, Realistic and Timebound…. or in other words “SMART”.
Select the individual or team: What are your reasons for delegating to this person or team? What are they going to get out of it? What are you going to get out of it?
Assess ability and training needs: Is the other person or team of people capable of doing the task? Do they understand what needs to be done. If not, you can’t delegate.
Explain the reasons: You must explain why the job or responsibility is being delegated. And why to that person or people? What is its importance and relevance? Where does it fit in the overall scheme of things?
State required results: What must be achieved? Clarify understanding by getting feedback from the other person. How will the task be measured? Make sure they know how you intend to decide that the job is being successfully done.
Consider resources required: Discuss and agree what is required to get the job done. Consider people, location, premises, equipment, money, materials, other related activities and services.
Agree deadlines: When must the job be finished? Or if an ongoing duty, when are the review dates? When are the reports due? And if the task is complex and has parts or stages, what are the priorities?
Support & communicate: Think about who else needs to know what’s going on, and inform them. Involve the other person in considering this so they can see beyond the issue at hand. Do not leave the person to inform your own peers of their new responsibility.
Feedback on results: It is essential to let the person know how they are doing, and whether they have achieved their aims. If not, you must review with them why things did not go to plan, and deal with the problems. You must absorb the consequences of failure, and pass on the credit for success.
Delegate, don’t abdicate: Remember if things go wrong, it’s ultimately your fault! Assess the risk of failure before you decide to delegate a task, and manage any risk appropriately. The only person you can blame is you, for not effectively delegating the task at the beginning. And you never know, they might even do it better than you!
Crystal clear tasks: If you can’t define the task to be delegated, it isn’t ready for delegation. Good tasks to delegate are; Specific, Measurable, Achievable, Realistic and Timebound…. or in other words “SMART”.
Select the individual or team: What are your reasons for delegating to this person or team? What are they going to get out of it? What are you going to get out of it?
Assess ability and training needs: Is the other person or team of people capable of doing the task? Do they understand what needs to be done. If not, you can’t delegate.
Explain the reasons: You must explain why the job or responsibility is being delegated. And why to that person or people? What is its importance and relevance? Where does it fit in the overall scheme of things?
State required results: What must be achieved? Clarify understanding by getting feedback from the other person. How will the task be measured? Make sure they know how you intend to decide that the job is being successfully done.
Consider resources required: Discuss and agree what is required to get the job done. Consider people, location, premises, equipment, money, materials, other related activities and services.
Agree deadlines: When must the job be finished? Or if an ongoing duty, when are the review dates? When are the reports due? And if the task is complex and has parts or stages, what are the priorities?
Support & communicate: Think about who else needs to know what’s going on, and inform them. Involve the other person in considering this so they can see beyond the issue at hand. Do not leave the person to inform your own peers of their new responsibility.
Feedback on results: It is essential to let the person know how they are doing, and whether they have achieved their aims. If not, you must review with them why things did not go to plan, and deal with the problems. You must absorb the consequences of failure, and pass on the credit for success.
Sex & chocolate could boost brain power
ENJOY dark chocolate, have plenty of sex, eat cold meats and fish for breakfast and you could boost your brain power, say the authors of a new book. Cognitive psychologist Terry Horne and biochemist Simon Wootton — who co-authored ‘Teach Yourself: Training Your Brain’ tip-top mental condition.
“Lifestyle can boost your brain power,” Horne said. “What your lifestyle does is help to create the chemical conditions in your brain.”
Horne told Reuters in an interview to mark the book’s publication that the brain is more like a chemical factory than a computer. “You can create the optimum conditions in your brain,” he said. “You are not just a passive victim of your genes.”
The authors take issue with those who argue that a decline in cognitive ability is inevitable from the age of 17 onwards. With careful lifestyle choices “you can create spare cognitive capacity,” Horne said.
They offer an intriguing list of dos and don’ts and insist that people can be pro-active in keeping their brains agile.
Much of it is pure common sense. “Stress is bad for your thinking. Avoid excessive alcohol and smoking cannabis,” he said. Intriguingly, the authors also urge readers to avoid watching soap operas and Horne said “Don’t mix with whingeing, whining, moaning and cynical sorts of people.”
And the book is full of practical tips on how to keep the brain firing on all cylinders. “Cold meats and fish are good for you at breakfast,” Horne said after writing the book which the authors say is based on leading scientific research from around the world.
“Dark chocolate is also good for you because it contains many of the chemicals present when your brain is thinking well. It relaxes the muscles around your blood vessels and actually improves the flow of blood to your brain.”
They then looked at research into the seven stages of sex from the time you first fancy it through to the after-glow. “In four of the seven stages we see the same chemicals that help with the thinking process,” Horne said. — Reuters
“Lifestyle can boost your brain power,” Horne said. “What your lifestyle does is help to create the chemical conditions in your brain.”
Horne told Reuters in an interview to mark the book’s publication that the brain is more like a chemical factory than a computer. “You can create the optimum conditions in your brain,” he said. “You are not just a passive victim of your genes.”
The authors take issue with those who argue that a decline in cognitive ability is inevitable from the age of 17 onwards. With careful lifestyle choices “you can create spare cognitive capacity,” Horne said.
They offer an intriguing list of dos and don’ts and insist that people can be pro-active in keeping their brains agile.
Much of it is pure common sense. “Stress is bad for your thinking. Avoid excessive alcohol and smoking cannabis,” he said. Intriguingly, the authors also urge readers to avoid watching soap operas and Horne said “Don’t mix with whingeing, whining, moaning and cynical sorts of people.”
And the book is full of practical tips on how to keep the brain firing on all cylinders. “Cold meats and fish are good for you at breakfast,” Horne said after writing the book which the authors say is based on leading scientific research from around the world.
“Dark chocolate is also good for you because it contains many of the chemicals present when your brain is thinking well. It relaxes the muscles around your blood vessels and actually improves the flow of blood to your brain.”
They then looked at research into the seven stages of sex from the time you first fancy it through to the after-glow. “In four of the seven stages we see the same chemicals that help with the thinking process,” Horne said. — Reuters
Sebi relaxes norms for issue of junk bonds
CAPITAL market regulator Sebi has paved the way for a junk bond market in India. Sebi on Monday removed the stipulation that debt instruments issued through public/rights issues should be of at least investment grade.
Companies will now be allowed to issue bonds after obtaining ratings from a single agency. “With a view to reduce the cost of issuance of debt instruments, it has now been decided that credit rating from one agency would be sufficient,” a Sebi press release issued on Monday said.
Current regulations stipulate credit rating to be obtained from not less than two credit rating agencies. With an aim to provide investors more debt investment options, companies will now be allowed to issue below-investment grade bonds. These bonds give higher returns than other bonds with better credit quality.
The regulator on Monday relaxed certain requirements enlisted in the Sebi (disclosure and investor protection) guidelines 2000 through which structural restrictions currently placed on debt instruments have been removed.
The guidelines currently require that the debt instruments issued through a public/rights issue shall be of at least investment grade. In a disclosure-based regime, it should be left to the investor to decide whether or not to invest in a non-investment grade debt instrument. Given this, and in order to develop the market for debt instruments, it has been decided to allow issuance of bonds which are below investment grade to the public to suit the risk/return appetite of investors.
Currently, institutional players like banks, mutual funds, primary dealers are the main participants in the corporate bond market. Experts feel while the Sebi’s step is in the right direction, for issuances to pick up, restrictions imposed on provident funds and pension funds on investment in corporate bonds need to be relaxed by the central government. Besides, corporate bonds are mainly being issued by financial institutions, banks and public sector units and there is hardly any issuance by the private sector, unlike other developed markets. The corporate debt accounts for as much as 25 to 30% of GDP in countries like the US and the UK while in India it is very less, as per a Boston Consulting Group official.
The regulator has also decided on removing structural restrictions currently placed on debt instruments such as those on maturity, put or call options on conversion among others. It’s a move which would help issuers to structure the instruments to suit their requirements, making the process flexible for them, Sebi said. India’s poorly developed corporate bond market is the weak link in the financial system and there is an urgent need to develop it, say experts.
Companies will now be allowed to issue bonds after obtaining ratings from a single agency. “With a view to reduce the cost of issuance of debt instruments, it has now been decided that credit rating from one agency would be sufficient,” a Sebi press release issued on Monday said.
Current regulations stipulate credit rating to be obtained from not less than two credit rating agencies. With an aim to provide investors more debt investment options, companies will now be allowed to issue below-investment grade bonds. These bonds give higher returns than other bonds with better credit quality.
The regulator on Monday relaxed certain requirements enlisted in the Sebi (disclosure and investor protection) guidelines 2000 through which structural restrictions currently placed on debt instruments have been removed.
The guidelines currently require that the debt instruments issued through a public/rights issue shall be of at least investment grade. In a disclosure-based regime, it should be left to the investor to decide whether or not to invest in a non-investment grade debt instrument. Given this, and in order to develop the market for debt instruments, it has been decided to allow issuance of bonds which are below investment grade to the public to suit the risk/return appetite of investors.
Currently, institutional players like banks, mutual funds, primary dealers are the main participants in the corporate bond market. Experts feel while the Sebi’s step is in the right direction, for issuances to pick up, restrictions imposed on provident funds and pension funds on investment in corporate bonds need to be relaxed by the central government. Besides, corporate bonds are mainly being issued by financial institutions, banks and public sector units and there is hardly any issuance by the private sector, unlike other developed markets. The corporate debt accounts for as much as 25 to 30% of GDP in countries like the US and the UK while in India it is very less, as per a Boston Consulting Group official.
The regulator has also decided on removing structural restrictions currently placed on debt instruments such as those on maturity, put or call options on conversion among others. It’s a move which would help issuers to structure the instruments to suit their requirements, making the process flexible for them, Sebi said. India’s poorly developed corporate bond market is the weak link in the financial system and there is an urgent need to develop it, say experts.
With 500 branches, Fullerton is the largest NBFC
AT A time when other multinational non-banking finance companies (NBFCs) have gone slow on their retail loans, Fullerton India, a subsidiary of Singapore government-owned fund Temasek, is aggressively ramping up its presence in the country. It has now opened 500 branches which make it the NBFC with the largest branch network in the country.
Fullerton, which already has the biggest branch presence among finance companies, plans to double its network next year. Most players have gone slow in rolling out their branches since this was turning out to be an expensive option. Citi Financial, which is one of the largest NBFCs in the country, has a branch presence of 480 across 165 cities while GE Money has 180 branches. They have been operating for the past seven years. Among Indian NBFCs, Mahindra Finance has the biggest branch network at 425, while others like Sundaram Finance have less than 200 branches.
On the question of the aggressive branch rollout compared with other MNC NBFCs, Fullerton India Credit chairman Francis Andrew Rozario said, “Sometimes, MNCs have a scale dilemma. It’s the only business which we are doing. They (other MNCs) are also there in the banking segment. We are entering a segment which is relatively under served. Scale is very important to us.” Fullerton India Credit Company is a wholly owned subsidiary of Fullerton Financial Holdings, Singapore. It had taken a 84% stake in Chennaibased Dove Finance in late 2005. It started its pilot phase in April 2006 with 24 branches. It started rolling out of branches after it completed its test phase in November 2006. Mr Rozario added, “We are also looking at how to take our model into semi-urban and rural India. There are six lakh villages, and at least, 6,000 villages have a population of more than 50,000. We will start off our pilot to test the rural model next year. The Indian NBFC has a committed capital of $300 million from the parent company, of which it has already invested $200 million. It also has around 10,000 employees making it the largest employers in the NBFC segment.
Most of the other NBFCs use direct-selling agents for sourcing customers. Fullerton focuses on customers within a 5 km of its branches and taps both self-employed and salaried classes. It plans to double its branch network next year.
Fullerton India Credit MD & CEO GS Sundararajan said, “We have a customer acquisition rate of 20,000 per month and this is likely to be scaled up to over onemillion customers per annum. We have disbursed around Rs 2,500 crore and will double our disbursements next year. We will break-even sometime next year. The aggressive move by Fullerton comes at a time when most other NBFCs are having a relook at their retail portfolio because of rising delinquencies. However, Fullerton does not seem to be facing the same problem. According to Mr Sundararajan, the credit losses are only 1.5% against an industry average of around 10% in the segment.
Fullerton, which already has the biggest branch presence among finance companies, plans to double its network next year. Most players have gone slow in rolling out their branches since this was turning out to be an expensive option. Citi Financial, which is one of the largest NBFCs in the country, has a branch presence of 480 across 165 cities while GE Money has 180 branches. They have been operating for the past seven years. Among Indian NBFCs, Mahindra Finance has the biggest branch network at 425, while others like Sundaram Finance have less than 200 branches.
On the question of the aggressive branch rollout compared with other MNC NBFCs, Fullerton India Credit chairman Francis Andrew Rozario said, “Sometimes, MNCs have a scale dilemma. It’s the only business which we are doing. They (other MNCs) are also there in the banking segment. We are entering a segment which is relatively under served. Scale is very important to us.” Fullerton India Credit Company is a wholly owned subsidiary of Fullerton Financial Holdings, Singapore. It had taken a 84% stake in Chennaibased Dove Finance in late 2005. It started its pilot phase in April 2006 with 24 branches. It started rolling out of branches after it completed its test phase in November 2006. Mr Rozario added, “We are also looking at how to take our model into semi-urban and rural India. There are six lakh villages, and at least, 6,000 villages have a population of more than 50,000. We will start off our pilot to test the rural model next year. The Indian NBFC has a committed capital of $300 million from the parent company, of which it has already invested $200 million. It also has around 10,000 employees making it the largest employers in the NBFC segment.
Most of the other NBFCs use direct-selling agents for sourcing customers. Fullerton focuses on customers within a 5 km of its branches and taps both self-employed and salaried classes. It plans to double its branch network next year.
Fullerton India Credit MD & CEO GS Sundararajan said, “We have a customer acquisition rate of 20,000 per month and this is likely to be scaled up to over onemillion customers per annum. We have disbursed around Rs 2,500 crore and will double our disbursements next year. We will break-even sometime next year. The aggressive move by Fullerton comes at a time when most other NBFCs are having a relook at their retail portfolio because of rising delinquencies. However, Fullerton does not seem to be facing the same problem. According to Mr Sundararajan, the credit losses are only 1.5% against an industry average of around 10% in the segment.
Mukesh Ambani looks to board Metro Rail
Group Submits Bid For Charkop-Bandra-Mankhurd Phase
THE Mukesh Ambani-led Reliance group has formally submitted its bid for the Rs 6,192-crore Charkop-Bandra-Mankhurd phase of the Mumbai Metro project.
The Mumbai Metropolitan Regional Development Authority (MMRDA), the nodal agency for the Metro project, on Monday opened seven technical bids it has received for the longest corridor of the project.
The second corridor is the longest route in the project. The government, at a later stage, plans to extend this 32-km stretch by another 32 km joining Mankhurd to the proposed Panvel Airport, and Bandra to Sahar international airport. The bidding for the extended portion will be done separately. This may take the total cost of the phase to over Rs 12,000 crore.
The non-compete agreement signed by the Ambani brothers is silent on railway projects and as such, both can compete with each other. The Rs 19,525-crore metro project will be implemented in three phases over 15 years.
The second phase will connect Mahim and Mankhurd (12.8 km), Charkop-Dahisar (7.5 km) and Ghatkopar-Mulund (12.4 km) and will be completed by 2016. The grand metro plan envisages a 146.5-km-long rail network, of which about 32.5 km will be underground and 114 km will be elevated.
Phase one will connect Colaba (Backbay), Mahim and Charkop (36 km), and Versova-Andheri-Ghatkopar (15 km). The first phase of the project, spanning three corridors, is targeted to be completed by 2011. In the third phase, the Metro line will connect Bandra-Kurla complex to Kanjur Marg via the airport (19.5 km), Andheri (East)-Dahisar (East) (18 km), Hutatma Chowk to Ghatkopar (21.8 km) and Sewri-Prabhadevi (3.5 km). The third phase would be fully functional by 2021.
The project was flagged off by
Prime Minister Manmohan Singh in
June last year.
BIDDERS
• L&T Infrastructure Development Projects, GE India Infrastructure & Constructions Y Auxiliar De Ferrocarriles
• Pioneer Infratech, Mitsubishi & Tata Power
• GVK, Yeoh Tiong Lay of Malaysia & Bombardier Transportation
• Reliance group, Siemens & Gammon India
• Essar, Alstom & Lanco
• IL&FS, IL&FS Transportation Networks & Punj Lloyd
• Reliance Energy, Reliance Communications & SNC Lavalin 6,192(RS CR) OUTLAY OF THE CHARKOPMANKHURD PHASE 32 KM. TOTAL DISTANCE OF THIRD PHASE 19,525 (RS CR) TOTAL COST OF THE METRO RAIL PROJECT 15 YEARS WHEN ALL THE THREE PHASES WILL BE IMPLEMENTED
THE Mukesh Ambani-led Reliance group has formally submitted its bid for the Rs 6,192-crore Charkop-Bandra-Mankhurd phase of the Mumbai Metro project.
The Mumbai Metropolitan Regional Development Authority (MMRDA), the nodal agency for the Metro project, on Monday opened seven technical bids it has received for the longest corridor of the project.
The second corridor is the longest route in the project. The government, at a later stage, plans to extend this 32-km stretch by another 32 km joining Mankhurd to the proposed Panvel Airport, and Bandra to Sahar international airport. The bidding for the extended portion will be done separately. This may take the total cost of the phase to over Rs 12,000 crore.
The non-compete agreement signed by the Ambani brothers is silent on railway projects and as such, both can compete with each other. The Rs 19,525-crore metro project will be implemented in three phases over 15 years.
The second phase will connect Mahim and Mankhurd (12.8 km), Charkop-Dahisar (7.5 km) and Ghatkopar-Mulund (12.4 km) and will be completed by 2016. The grand metro plan envisages a 146.5-km-long rail network, of which about 32.5 km will be underground and 114 km will be elevated.
Phase one will connect Colaba (Backbay), Mahim and Charkop (36 km), and Versova-Andheri-Ghatkopar (15 km). The first phase of the project, spanning three corridors, is targeted to be completed by 2011. In the third phase, the Metro line will connect Bandra-Kurla complex to Kanjur Marg via the airport (19.5 km), Andheri (East)-Dahisar (East) (18 km), Hutatma Chowk to Ghatkopar (21.8 km) and Sewri-Prabhadevi (3.5 km). The third phase would be fully functional by 2021.
The project was flagged off by
Prime Minister Manmohan Singh in
June last year.
BIDDERS
• L&T Infrastructure Development Projects, GE India Infrastructure & Constructions Y Auxiliar De Ferrocarriles
• Pioneer Infratech, Mitsubishi & Tata Power
• GVK, Yeoh Tiong Lay of Malaysia & Bombardier Transportation
• Reliance group, Siemens & Gammon India
• Essar, Alstom & Lanco
• IL&FS, IL&FS Transportation Networks & Punj Lloyd
• Reliance Energy, Reliance Communications & SNC Lavalin 6,192(RS CR) OUTLAY OF THE CHARKOPMANKHURD PHASE 32 KM. TOTAL DISTANCE OF THIRD PHASE 19,525 (RS CR) TOTAL COST OF THE METRO RAIL PROJECT 15 YEARS WHEN ALL THE THREE PHASES WILL BE IMPLEMENTED
Parking comes at a premium in metros
Builders Charge Up To Rs 25 Lakh Extra
LITTLE did Atul Kulkarni (name changed), a Mumbai-based banker, know when he bought a Santro that it would end up costing him Rs 29 lakh. The car itself was relatively cheap at Rs 4 lakh; the parking space cost Mr Kulkarni a whopping Rs 25 lakh.
In the Mumbai market, where home prices have risen as high as Rs 50,000 per sq ft, builders are charging an extra Rs 10 lakh to Rs 25 lakh for parking space. Housing societies in the prime localities of Malabar Hill, Pedder Road and Bandra are charging Rs 15 lakh for parking even in open spaces.
One of the prominent residential towers in Pedder Road recently sold an open parking space in the range of Rs 10-15 lakh. Another building called Poornima in South Mumbai won a case against its builder who had sold the open parking space along with a flat for an additional Rs 15 lakh.
This phenomenon is not restricted to land-starved Mumbai. Developers and housing co-operative societies are charging an ‘extra’ Rs 5-25 lakh in metros like Delhi, Bangalore and Chennai as well. Rising car sales and income levels are making builders cash in on the situation. Even a few years ago, the opportunity did not exist.
Some experts believe the situation home-owners and buyers are finding themselves in is because many upper middle-class families now own more than two vehicles. Parking spaces are major revenue earners
THUS, most developers now see the sale of parking space as one of the major revenue generators.
Says Niranjan Hiranandani, chairman, Hiranandani Developers: “We were incentivising customers by providing parking space. Nowadays, everything has a cost. Earlier, there was only one vehicle per home. Now it is two, three or more. So, what is the solution?”
And so, even as the debate continues on whether the sale of car parking area is legal, developers and housing co-operative societies are striking it rich by way of sale of parking lots. Under the law (applicable in Mumbai; other states have similar laws), only the sale of closed parking spaces — that is, garages — is permissible. The other three types of parking spaces — semiclosed, open and on stilts — cannot be sold. Wherever it’s being sold, it has to be a part of the flat — there can’t be a separate sale of parking space unless specifically cleared by the respective authority while clearing the plan.
Developers admit that they are charging an additional sum for parking space. Lalit Gandhi, CMD, Lok Housing, said his firm is charging Rs 50,000 to Rs 4 lakh for an extra parking lot while a Bandra-based developer told ET he is charging Rs 10 lakh for parking space in his recentlylaunched project.
Sobha Developers MD, JC Sharma, believes builders are justified in charging extra for parking space. Says Mr Sharma, “The car park cost is not included in the per square foot of super built-up area rate we charge. It is an additional cost. We have separate rates for covered (basement) car parks and open car parks — Rs 2,00,000 for covered parks and Rs 1,50,000 for open car parks.” Skyline Constructions and Housing MD, Avinash Prabhu, says his company charges anywhere between Rs 1,25,000 and Rs 2,50,000.
While property developers of new residential projects do not charge anything for ‘open car park’ space, the range varies between Rs 1.5 lakh and Rs 3 lakh for covered car parks across Chennai. Akshya Homes MD, T Chitty Babu, says they do not charge for provision of open car parks as no space is earmarked by builders, and it is done by the ‘owners’ association’. However, in the case of covered car parks, they charge anything between Rs 1.5 lakh and Rs 3 lakh.
While home owners seem to have swallowed the bitter pill of having to pay for covered parking space, they are livid about developers’ attempts to try and sell open parking space. “This is illegal. Open parking spaces are the property of the society,” says Pedder Road Residents' Association chief Maninder Singh, pointing to the fact that even the courts have ruled in his favour.
Eminent lawyer and president of the Mumbai Flat Owners Association, Mahabaleshwar Morje, says barring some designated areas, builders are bound to provide free parking in Mumbai city for one vehicle per flat. They simply cannot charge for open parking space, he adds. But given the space crunch, the booming real estate market and the burgeoning demand for parking, this is one jam that is unlikely to be resolved in a hurr
Builders Charge Up To Rs 25 Lakh Extra
LITTLE did Atul Kulkarni (name changed), a Mumbai-based banker, know when he bought a Santro that it would end up costing him Rs 29 lakh. The car itself was relatively cheap at Rs 4 lakh; the parking space cost Mr Kulkarni a whopping Rs 25 lakh.
In the Mumbai market, where home prices have risen as high as Rs 50,000 per sq ft, builders are charging an extra Rs 10 lakh to Rs 25 lakh for parking space. Housing societies in the prime localities of Malabar Hill, Pedder Road and Bandra are charging Rs 15 lakh for parking even in open spaces.
One of the prominent residential towers in Pedder Road recently sold an open parking space in the range of Rs 10-15 lakh. Another building called Poornima in South Mumbai won a case against its builder who had sold the open parking space along with a flat for an additional Rs 15 lakh.
This phenomenon is not restricted to land-starved Mumbai. Developers and housing co-operative societies are charging an ‘extra’ Rs 5-25 lakh in metros like Delhi, Bangalore and Chennai as well. Rising car sales and income levels are making builders cash in on the situation. Even a few years ago, the opportunity did not exist.
Some experts believe the situation home-owners and buyers are finding themselves in is because many upper middle-class families now own more than two vehicles. Parking spaces are major revenue earners
THUS, most developers now see the sale of parking space as one of the major revenue generators.
Says Niranjan Hiranandani, chairman, Hiranandani Developers: “We were incentivising customers by providing parking space. Nowadays, everything has a cost. Earlier, there was only one vehicle per home. Now it is two, three or more. So, what is the solution?”
And so, even as the debate continues on whether the sale of car parking area is legal, developers and housing co-operative societies are striking it rich by way of sale of parking lots. Under the law (applicable in Mumbai; other states have similar laws), only the sale of closed parking spaces — that is, garages — is permissible. The other three types of parking spaces — semiclosed, open and on stilts — cannot be sold. Wherever it’s being sold, it has to be a part of the flat — there can’t be a separate sale of parking space unless specifically cleared by the respective authority while clearing the plan.
Developers admit that they are charging an additional sum for parking space. Lalit Gandhi, CMD, Lok Housing, said his firm is charging Rs 50,000 to Rs 4 lakh for an extra parking lot while a Bandra-based developer told ET he is charging Rs 10 lakh for parking space in his recentlylaunched project.
Sobha Developers MD, JC Sharma, believes builders are justified in charging extra for parking space. Says Mr Sharma, “The car park cost is not included in the per square foot of super built-up area rate we charge. It is an additional cost. We have separate rates for covered (basement) car parks and open car parks — Rs 2,00,000 for covered parks and Rs 1,50,000 for open car parks.” Skyline Constructions and Housing MD, Avinash Prabhu, says his company charges anywhere between Rs 1,25,000 and Rs 2,50,000.
While property developers of new residential projects do not charge anything for ‘open car park’ space, the range varies between Rs 1.5 lakh and Rs 3 lakh for covered car parks across Chennai. Akshya Homes MD, T Chitty Babu, says they do not charge for provision of open car parks as no space is earmarked by builders, and it is done by the ‘owners’ association’. However, in the case of covered car parks, they charge anything between Rs 1.5 lakh and Rs 3 lakh.
While home owners seem to have swallowed the bitter pill of having to pay for covered parking space, they are livid about developers’ attempts to try and sell open parking space. “This is illegal. Open parking spaces are the property of the society,” says Pedder Road Residents' Association chief Maninder Singh, pointing to the fact that even the courts have ruled in his favour.
Eminent lawyer and president of the Mumbai Flat Owners Association, Mahabaleshwar Morje, says barring some designated areas, builders are bound to provide free parking in Mumbai city for one vehicle per flat. They simply cannot charge for open parking space, he adds. But given the space crunch, the booming real estate market and the burgeoning demand for parking, this is one jam that is unlikely to be resolved in a hurr
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