Companies & Sectors
'Cameroon likely to raise Tata Steel issue with Modi'
London : The sudden announcement by Tata Steel that it could sell its UK units has left the British government worried with speculation that Prime Minister David Cameron may take up the issue with Indian Prime Minister Narendra Modi when they meet in Washington, D.C..
 
Both leaders will be in the US capital for the Nuclear Security Summit later on Friday.
 
Earlier, Cameron flew back here for emergency talks with ministers to tackle the crisis engulfing Tata Steel’s British operations, amid warnings that the firm has just weeks for a rescue deal on which up to 40,000 jobs could depend, The Guardian reported.
 
The daily also quoted an unnamed source as saying that Tata Steel was losing one million pounds per day, with the government’s failure to back the calls in Europe for higher tariffs against cheap Chinese imports being the “last straw” to prompt the company's decision.
 
The Labour Party has termed it a national crisis wanting the steel industry to be nationalised.
 
But British Business Secretary Sajid Javid has rejected the idea as it could carry a price tag of 1.5 billion pounds per annum. “I don’t think that nationalisation is going to be the solution,” The Guardian quoted Javid as saying.
 
The paper said Cameron was expected to raise the issue with Modi.
 
Tatas have written off 2 billion pounds from the value of the group's UK assets, rendering the investment effectively worthless. The Guardian quoted Tata Steel finance director Koushik Chatterjee as saying that the UK operations were "quite a burden" and one which the company couldn't sustain.
 
Having suffered nearly $3 billion in losses on the UK operations, Tata Steel on Wednesday said it will explore options to put its entire portfolio there up for sale, some 10 years after it forayed into Europe by acquiring Anglo-Dutch Corus for over $8.1 billion.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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COMMENTS

Gururaj Rao

1 year ago

Looking at the title, I wondered what the country of Cameroon had to to with Tata Steel!

Suspended Gurdaspur SP to be quizzed by NIA again
New Delhi : Suspended Gurdaspur Superintendent of Police Salwinder Singh and his cook were on Thursday brought to the NIA headquarters for questioning even as the joint investigation team from Pakistan is here to probe the Pathankot terror attack.
 
Singh has claimed that he, his friend Rajesh Verma and cook Madan Gopal were abducted by four or five heavily-armed terrorists near Punjab's Kolia village on January 2. The terrorists later attacked the Pathankot Indian Air Force base, in which seven security personnel were killed. The Pakistani terrorists were later killed in the shootout. 
 
The Pakistani team is in India to probe the Pathankot attack.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
 
 

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Deposit growth falls below 10%, credit growth remains weak
Lack of fresh investment continues to lead to a low demand of credit from corporates 
 
The credit growth for the fortnight ended 18 March 2016 was stable at 11.3% as against 11.5% in the previous fortnight. At the same time, deposit growth dipped to sub-10% levels, shows data released by the Reserve Bank of India (RBI).
 
"Deposit growth declined to 9.9% on account of a decline in term deposits. Investment growth fell for the third consecutive fortnight to 5.9%, which led the statutory liquidity ratio (SLR) to dip to 25.9%. Credit growth has been weak over the last few months due to low corporate demand and lack of fresh investments. We do not see material improvement ahead and forecast 12% growth for FY2016," says Religare Capital Markets Ltd in a research note.
 
 
As per RBI data, credit growth for the fortnight ended 18th March was stable at 11.3% compared with 11.5% the previous fortnight. In absolute terms, credit offtake increased by Rs30,000 crore as against Rs80,000 crore in the fortnight ended 4th March. Weakness over the last few months has stemmed from low corporate demand and a lack of fresh projects. As per sectoral deployment of bank credit, growth in non-food credit as of January 2016 improved to 9.8%. Growth in the agriculture and retail segments picked up to 13.4% and 18.1%, respectively while that in the services sector moderated to 8.9%. A slowdown was observed across sub-sectors such as food processing (-2.4%), beverages and tobacco (-4.6%) and cement & cement products (-3.8%).
 
During the fortnight, term deposit declined by Rs60,000 crore to Rs84.8 lakh crore. Investment growth too tumbled to 5.9% compared with 6.8% in the previous fortnight, which drove the SLR lower to 25.9%. Banks have been consciously keeping SLR balances above the regulated levels of 21.5% as this helps them meet liquidity coverage ratio (LCR) requirements. "In our view, slow credit offtake is another contributing factor that should keep SLR elevated in coming months as well," the report says.
 
Talking about loan growth in FY2016, Religare said, "We do not expect any material improvement in credit growth for FY2016 and build in modest about 12% growth for the year. Mid-tier public sector banks are likely to grow below the system due to asset quality stress. This should lead to market share gains for private banks, especially mid-tier names such as YES Bank and IndusInd Bank, which we expect will grow much higher than the industry."

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COMMENTS

Surinder Kumar Kohli

1 year ago

The governments attitude is negative towards savings. The gradual decrease in interest rates on bank fixed deposits and other savings instruments has lead to this situation. The recent reduction and interest on PPF and SCSS schemes shows governments apathy towards senior citizens and small traders, who deposit money in SCSS and PPF.

Ramesh Poapt

1 year ago

deposit growth will fall further from Apr.16, as the banks will cut deposit rates aggressively as Govt's small deposit schemes rates has been lowered now. Further, RBI will cut rates in 5 April16 meet. In absence of lending opperunities as NPA mess, deposit growth was rightly lower.

Chandragupta Acharya

1 year ago

The usage of the terms "weak" & "strong" to refer to "low" and "high" credit growth is judgmental and faulty. What was celebrated as "strong" credit growth 3 years ago has come back to haunt us as NPAs today. Banks can be imprudent in their lending and show rapid growth for long periods of time before the chickens come home to roost. I would therefore request you to avoid this erroneous usage.

REPLY

Ramesh Poapt

In Reply to Chandragupta Acharya 1 year ago

sir, strong/weak is in quantitative term only and not qualitative. nothing wrong about it.

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