Documents presented by the US Department of Justice in an American court stated that California-based Control Component Inc had bribed officials of Indian PSUs, including BHEL, NTPC and several state electricity boards, to bag orders
The Central Vigilance Commission (CVC) today said it will look into the allegations of bribery against officials of state-owned BHEL and NTPC once their names are disclosed by the US Department of Justice, reports PTI.
"We have our chief vigilance officers in all organisations and they are supposed to carry out their job," the CVC's chief technical examiner, V Ramachandran, told reporters, adding that the commission will scrutinise the matter whenever it is brought to its notice.
Mr Ramachandran said this while responding to queries on the documents presented by the US Department of Justice in an American court stating that California-based Control Component Inc had bribed officials of Indian PSUs, including BHEL, NTPC and several state electricity boards, to bag orders.
California-based Control Component Inc (CCI) on 31 June, 2009, pleaded guilty before the US court to having committing bribery in 36 countries from 2003 to 2007.
While NTPC denied any involvement in the case, BHEL said it could not comment on the issue in the absence of details.
"For the Sipat project (in Chhattisgarh), NTPC has not placed any direct order on the said company. NTPC is also not a party in the contract between any of the manufacturers and its equipment suppliers, i.e. the said party Control Component Inc," NTPC had said in a statement.
"It is a general statement with no specific details, BHEL can comment only when full details (as put up by Control Component to the US court) are accessible," a BHEL official had said.
Mr Ramachandran said, "The case has not been registered with the Central Bureau of Investigation (CBI_. As and when it comes to India, the CBI will refer the matter to us. Then, we will look into it."
India, besides China, the UAE and Qatar, are some of the major countries where CCI indulged in unfair practices to bag contracts, as per the court documents.
According to the documents, the payments related to India were made between 2004 and 2007.
Topping the list is the Sipat coal-fired power plant of NTPC, for which CCI paid a bribe of $163,449 in two instalments to an official of a Moscow-based company, who has been identified as Vladimir Batenko in the documents submitted by the US Department of Justice before the US court.
The multilateral lender hiked its growth projection from the earlier estimate of 8.8% on favourable financing conditions and robust corporate profits
The International Monetary Fund (IMF) today raised India's growth forecast for 2010 to 9.5%, stating that favourable financing conditions and robust corporate profits will accelerate economic expansion, reports PTI.
The multilateral lender hiked its growth projection from the earlier estimate of 8.8% it made in April.
"In India, growth is expected to accelerate to about 9.5% in 2010, as robust corporate profits and favourable financing conditions fuel investment, and then to settle to 8.5% in 2011," the IMF said in an update of its World Economic Outlook.
Recently, prime minister Manmohan Singh had said the country's economy is expected to grow by 8.5% for the fiscal year ending 31 March, 2011. In the last fiscal, the economy expanded 7.4%.
According to the IMF, the world economy expanded at an annualised rate of over 5% during the first quarter of 2010, mostly due to robust growth in Asia.
"World growth is projected at about 4.5% in 2010 and 4.25% in 2011," the report said.
The lender noted that Asia's strong recovery from the global financial crisis continued in the first half of 2010, despite renewed tension in global financial markets.
"GDP growth forecasts for Asia have been revised upward for 2010, from about 7% in the April WEO (World Economic Outlook) to about 7.5%," it added.
Meanwhile, the IMF warned that despite the stronger than expected first half recovery, uncertainties surrounding sovereign risks could hamper the economic outlook.
IMF chief economist Olivier Blanchard pointed out that downside risks have risen sharply.
"While we remain cautiously optimistic about the pace of recovery, there are clearly dangers ahead... outcome will be decided based on how Europe deals with fiscal problems, how advanced countries proceed with fiscal consolidation and how emerging market countries re-balance their economies," Mr Blanchard said.
SEBI and the stock exchanges are expected to reach a consensus on allowing physical settlement in derivatives by the end of July
Traders may soon be able to settle their derivates positions physically instead of cash as discussions between the stock exchanges and the regulators are in the final stages. Securities and Exchange Board of India (SEBI) chairman CB Bhave today said that the decision on physical settlement in derivatives is expected in a month.
"Various issues have been discussed with the stock exchanges and a final decision can be expected within a month's time," said Mr Bhave on the sidelines of the launch of the 'Certification Examination for Financial Advisors' at the National Stock Exchange (NSE). Mr Bhave also said that currency options will be launched fairly soon.
The Derivatives Market Review Committee headed by erstwhile Indian School of Business dean M Rammohan Rao had submitted its report on physical settlement in derivatives back in March 2008. SEBI gave an in-principle approval in March 2010 as per the recommendations of this committee. It is not clear whether the move would boost trading volumes.
"Having physical settlement of stock-related derivatives is a welcome step. It's an international practice. But it would not be good to put all the derivative stocks in physical settlement mode. There should be specific criteria about the liquidity and the impact cost, delivery volumes, etc, in any stock and based on that the stock should qualify for physical settlement. All index stocks could be brought into physical mode. The success would depend on all operational modalities. If the whole thing becomes successful, then they can liberalise the criteria and extend it to other stocks as well," said Sandeep Singhal, co-head, Institutional Equities, Emkay Global Financial Services.
Physical settlement in Indian markets was not allowed due to the absence of stock lending borrowing (SLB) mechanism and concerns of short freeze by short-sellers in illiquid stocks. Settlements are currently done through the National Securities Clearing Corporation Ltd (NSCCL) on the NSE. The average daily turnover on the derivatives segment of the NSE for the month of June 2010 stands at Rs92,527 crore. Unlike cash settlement, a physical derivatives contract has to be settled with shares. NSE launched derivatives trading with index futures on 12 June 2000. On 4 June 2001, it introduced trading in index options. Futures on individual securities were introduced on 9 November 2001. Currently, derivatives trading is based on individual securities and indices like S&P CNX Nifty, CNXIT, BANK Nifty, Nifty Midcap 50, etc. Almost the entire derivatives volume is with the NSE.
"It is the way forward. All transactions have to be logically concluded so physical settlement will help. We can't say anything about the short-term but it will bring stability to the market," said Deena Mehta, managing director, Asit C Mehta Investment Intermediates.