New Delhi: Spelling trouble for over a million users of Blackberry in India, the government has warned the Canadian service provider that if it does not allow facility to monitor emails and SMSes to address security concerns, it will have to close down operations in the country, reports PTI.
The government has said that the makers of BlackBerry - Research in Motion (RIM) - have to address its security concerns by offering the monitoring facility.
"If they don't follow our guidelines, we will have no option but to ask them to stop their operations in India," a senior official said.
The smartphone is used by over a million customers in India.
The ministry of home affairs (MHA) has asked the Department of Telecommunication (DoT) to tell the popular smartphone company in no uncertain terms that its emails and other data services must comply with formats that can be monitored by security and intelligence agencies.
The MHA made it clear that RIM has been addressing security concerns of several other countries, including the United States, where it operates and therefore, there is no justification to not comply the same in India.
The government also wants a BlackBerry server in India but the company has been resisting the move. Once the server is in India, it will be easy to track the messages.
BlackBerry says the messages are encrypted. The smartphone's server is based in Canada where the encryption level is very high and extremely difficult to crack. And any message going through a Canada server is encrypted and therefore cannot be accessed by intelligence agencies in India.
There are reports that China has got a similar server in the country.
Senior officials of key security agencies at a recent meeting argued that the continuation of BlackBerry services in the present format poses danger to the country. The meeting was attended by representatives of the MHA, DoT, intelligence agencies and the National Technical Research Organisation (NTRO).
The latest development indicates that security agencies are again finding it difficult to intercept or decipher messages sent through these phones, which use codes with an encryption of 256 bits.
This encryption code first scrambles the emails sent from a BlackBerry device and unscrambles it when the message reaches its target.
Leading telecom companies in India such as Bharti Airtel, Vodafone Essar, Reliance Communications, Tata Teleservices, BSNL and MTNL offer BlackBerry services.
The surveillance mechanisms in both exchanges and with SEBI failed to catch the massive price fluctuation; the phenomenal gap in high prices on the BSE and NSE in a heavily-traded scrip shows how imperfect the Indian market is
Today morning witnessed an unusual listing on the country\'s leading bourses, the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE). Emami Infrastructure Ltd, the demerged realty arm of FMCG major Emami Ltd, started trading on the national bourses today, and managed to raise quite a stink on its debut.
The shares of Emami Infra opened as high as Rs598.80 on the NSE, only to come crashing down to Rs86 at the hour mark, translating into an astounding drop of 86%. Meanwhile, on the BSE, Emami Infra opened at Rs250, hitting a high of Rs293 (a good Rs306 below the NSE high) and then slipping to a low of Rs86.
This humungous difference in the high prices of the two national bourses, (in a stock that was heavily traded) sustained for over an hour before converging to one point.
In the meantime, traders in the system would have had a field day playing arbitrage between the two exchanges. The fact that this gap did not close immediately is an indication of the shallow nature of our capital markets. Even at the end of market trading hours, the closing price of Emami Infra on the two exchanges is still showing an unusual gap. It closed at Rs101.70 on the BSE, while on the NSE, the closing price is substantially higher at Rs104.80. A massive gap of 4% in a scrip that traded 305.6 lakh shares between the NSE and BSE is unheard of.
It is also utterly bewildering to see the huge drop in the value of the shares on both the exchanges, more so on the NSE. The share price witnessed wild gyrations throughout the day, definitely pointing to manipulation. Some entities would have possibly put artificial bids in the system. The capital market regulator and the exchanges, it seems, remained oblivious to the happenings around this stock. How is it possible that such massive distortions completely escaped the Integrated Market Surveillance System (IMSS) on both the exchanges? Would it not have been possible for the exchanges to maintain vigilance on the stock\'s listing day, isolating traders who put in artificial bids?
Moneylife spoke to Deena Mehta, managing director at Asit C Mehta Investment Intermediates, who told us that the surveillance system and circuit filters did not play a role as they are not operational on the day of listing of a stock. "We are open to that risk on the first day of listing. It is a risk which cannot be managed. Because everyone expects volatility on the first day, there are no circuit filters on this day."
While it is possible for the exchange to suspend trading in the stock in such situations, it is not an option that can be easily exercised, explains Ms Mehta. "If somebody points out that there is something fishy, then subsequently investigations will happen; surveillance and impounding may occur. However, you can\'t expect instant action. You cannot halt a running market. The sanctity of the market has to be preserved at all times."
Moneylife has written to the Securities and Exchange Board of India (SEBI) as well as the BSE and NSE to explain their position on this issue. However, at the time of writing this story, we are still awaiting a response from them.
When we contacted the company for their view on the matter, we were bluntly told by Mohan Goenka, director of Emami Group of Companies, "I have no clue why the share prices had such a big gap in the listing prices in both the exchanges (NSE and BSE). We know how to run our business; you need to ask the exchanges about the price volatility."
Private sector lender Kotak Mahindra Bank today said that its shareholders have approved the selling of 4.5% stake to Japanese financial services major Sumitomo Mitsui Banking Corp for Rs1,366 crore.
At an extraordinary general meeting, the shareholders approved the allotment of 3.28 crore equity shares at a price of Rs416.50 a share, aggregating to Rs1,366 crore, Kotak Mahindra Bank said in a filing to the Bombay Stock Exchange.
Last month, Kotak Bank had entered into an agreement with Sumitomo to sell 1.64 crore shares, or 4.5%, at Rs833 a share, for Rs1,366 crore.
The shareholders today approved subdivision of shares, pursuant to which the number of shares to be allotted to Sumitomo stood at 3.28 crore, the filing added. The domestic bank had, last month, said that the sale would help the domestic bank boost its cash flow to fund its expansion plans.
This is the first time that a Japanese bank has made investments in a domestic bank. The deal values Kotak Mahindra at over Rs30,000 crore. Shares of Kotak Bank closed at Rs764, down 0.3% on the BSE. The Sensex closed down 120 points at 17,957.