Companies & Sectors
Deduct bank guarantee of mine given to Hindalco, Tata Power: IMG

The IMG decided to recommend deduction of bank guarantee in the case of a mine jointly allotted to Aditya Birla Group's flagship company Hindalco and Tata Power due to delays in development of the block

 
New Delhi: Moving ahead with action against erring coal block allottees, the Indian government has decided to deallocate one more mine and deduct bank guarantees of two others even as the ministerial panel recommended forfeiture of bank guarantee of a block allotted to Hindalco and Tata Power, reports PTI.
 
The decision to de-allocate Gourangdih ABC coal block, jointly given to JSW Steel, a company owned by Sajjan Jindal, brother of Congress MP Naveen Jindal and Himachal EMTA was taken on the recommendation of the Inter-Ministerial Group (IMG).
 
The panel is scrutinising 29 out of 58 cases that were served show cause notices for non-development of mines during prescribed timeline.
 
"I have approved the IMG's recommendations given on Friday and will take a call on others," Coal Minister Sriprakash Jaiswal said.
 
The IMG, on Friday had recommended de-allocation of the Gourangdih ABC mine, given jointly to JSW Steel and Himachal EMTA, in 2009, having an extractable reserve of 61.54 million tonnes (MT).
 
With this the total number of blocks approved for de-allocation has gone up to five out of total seven recommended by the IMG so far. Government has also approved deducting bank guarantee (BG) in case of five mines out of total eight recommended by the IMG so far.
 
Meanwhile, the panel decided to recommend deduction of bank guarantee in the case of a mine jointly allotted to Aditya Birla Group's flagship firm Hindalco and Tata Power due to delays in development of the block.
 
"The IMG today recommended deduction of bank guarantee of Tubed coal block in Jharkhand, allotted to Hindalco and Tata Power in August 2007," an official source told PTI.
 
The panel could take up only Tubed block for scrutiny on Monday and would meet again on Monday to scrutinise another six of seven cases, which failed to adhere to the timeframe for developing the mines given to them, sources said.
 
The Tubed mine, which finds mention in CAG report, has an extractable reserve of 130 million tonnes (MT) and the coal from it was meant to be used for a power project.
 
The five mines approved by government for de-allocation are - Gourangdih ABC-- jointly given to JSW Steel and Himachal EMTA, Bramhadih in Jharkhand allocated to Castron Mining in 1996, Chinora and Warora (southern part) blocks in Maharashtra given to Fieldmining and Ispat in 2003, Lalgarh (North) block in Jharkhand allotted to DOMCO Smokeless Fuels in 2005.
 
As far as deduction of BG is concerned, government has accepted the IMG recommendation in case of Marki Mangli II, III and IV in Maharashtra allotted to Shri Virangana Steel in 2005, Lohari block in Jharkhand given to Usha Martin in 2005 and Nerad Malegaon in Maharashtra which was allotted to Gupta Metaliks & Power in 2006.
 
Besides, the government also gave nod to IMG recommendation for submitting bank guarantee by Monnet Ispat & Energy for Utkal B2 Block in Odisha allocated in 1999.
 
Some of these coal blocks find mention in the CAG report, which had recently estimated that the financial impact of the benefit to the private allottees will be about Rs1.86 lakh crore.
 
Meanwhile, the panel is meeting again on Tuesday to decide the fate of about six more coal mines allocated to private firms that were issued notices for delaying production.
 
The panel has so far scrutinised the replies furnished by 19 coal block allottees out of 29.
 
It earlier heard the coal block allottees, who were invited to make presentations from 6-8 September, and also obtained updated status paper from Coal Controller/Ministry of Coal.
 

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Sugar production in FY13 likely to be at 25 MT: Rabobank

Concerns regarding the prospect of lower cane yields and sugar output in Maharashtra and Karnataka and the approaching peak sugar consumption period have led to retail prices of sugar going up by 15% over the last month says Rabobank, which specialises in agri-business

 
Mumbai: Sugar production for 2012-13 is expected to be at around 25 million tonnes (MT) against 26 MT last year while consumption is forecast at about 23 MT, reports PTI quoting a sugar quarterly review by Rabobank.
 
Monsoon rains have been 12% below normal as of end-August and though most of the cane producing regions are irrigated, dry weather is expected to impact the cane crop as irrigation from existing water reservoirs cannot offset the deficit in rainfall, the bank which specialises in agri business said.
 
Commenting on the domestic market, it said production in Maharashtra and Karnataka is likely to decline though the shortfall would be offset by increase in production in Uttar Pradesh and Tamil Nadu.
 
Maharashtra's sugar production is projected to decline by 15% to 7.6 MT in 2012-13 as against 8.9 MT in 2011-12 due to deficit rainfall and that in Karnataka by 21% to 3 MT.
 
Production in Uttar Pradesh, however, is expected to increase by 12% to 7.8 MT and that in Tamil Nadu by around 11% to about 2.3 MT, Rabobank said.
 
Concerns regarding the prospect of lower cane yields and sugar output in Maharashtra and Karnataka plus the approach of the peak sugar consumption period have led to retail prices of sugar going up by 15% over the last month, it said.
 
Retail sugar prices in Delhi and Mumbai are currently around Rs40 per kg, the highest in 18 months and 25% above year-ago levels, the bank said.
 

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Finance Ministry, bankers agree to resolve funding woes of realtors

CREDAI president Jain said Financial Services Secretary DK Mittal has asked banks to fund under-construction projects on priority basis as well as projects in tier II and III cities

 
Mumbai: Cash-strapped realty players have sounded upbeat after the Finance Ministry and bankers agreed to look into their grievances, primarily related to funding, reports PTI.
 
Financial Services Secretary DK Mittal met bankers and the real estate developers body Confederation of Real Estate Developer's Associations of India (CREDAI) and discussed various issues affecting the sector.
 
"We have seen very serious commitment by the government in creating more housing stock. During the meeting, Mittal asked banks to focus on funding under-construction projects which have been delayed.... a positive sign for developers who are facing liquidity crunch," CREDAI national president Lalit Kumar Jain told reporters after the meeting.
 
Jain said the secretary asked banks to fund under-construction projects on priority basis as well as projects in tier II and III cities.
 
"Many projects were stalled due to lack of funds. This will help in creating more stock, especially in small towns," Jain said, adding issues like approvals and clearances were also discussed at the meeting.
 
"Bankers have also agreed that factors like delay in project approvals, limitation on availability of land for real estate and even the FSI restrictions should be addressed, as they become a major hurdle when it comes to funding. If this issue is addressed, it will help create adequate stock," Jain said.
 
Mittal also asked the real estate apex body CREDAI, to conduct a survey of unsold housing stock so that a decision could be taken on unlocking their value, Jain said.
 
"There has been a general perception that developers are holding on to inventories to push up property prices. But the reality is different. We will appoint a consultant and conduct a survey as directed by the secretary, to find out the actual status of housing stock," he said.
 
"At present there is no method available to get the information on the actual status of the stock. We will do it through a credible agency. We will soon finalise the agency to do the job," Jain said.
 

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