The move comes as a breather for vendors especially from China, like Huawei and ZTE, as well as Indian telecom companies like RCom and Tata Teleservices that are looking for cost-effective telecom gear to expand their networks
Fifteen companies, including British Telecom, have been shortlisted by the government to select a telecom vendor, which will certify equipments imported by various mobile companies into the country, especially from China, reports PTI.
Official sources said the Department of Telecom (DoT) has been asked to pick the international security audit firm which will certify the imported equipments.
The move comes as a breather for vendors especially from China like Huawei and ZTE, as well as Indian telecom companies like Reliance Communications (RCom) and Tata Teleservices (TTSL) that are looking for cost-effective telecom gear to expand their networks.
Under a proposal, the government has allowed telecom companies to import the equipment from foreign suppliers only after an international certification agency visits the plant of the vendor and gives a security clearance.
India currently does not have any certification agency.
The mobile operators who intend to import telecom equipment have to give a bank guarantee to the DoT.
The operators will be liable to forfeit their bank guarantee and may also face criminal proceedings, if any security threats are detected in the equipment at a later stage.
The stop-gap solution, which will be in place for the next 12 months, will ensure that Indian telecom companies do not face project delays.
The government, in the meantime, will initiate the process to set up an indigenous certification agency of international standard.
The certification work was initiated by Indian Institute of Sciences (IIS) but could not make a major headway.
The government has plans to form a broadcasting regulator which will cater to TV channel registrations, licences and ratings. The industry is not amused
The Broadcast Audience Research Council (BARC), an organisation set up by advertisers to oversee television audience measurement and ratings for broadcasters, will most probably be in place by next month. However, the government has decided to form a different broadcasting watchdog which will cater to registrations, licences and ratings. So is it time for the TV industry to get its act together?
At a conclave in Mumbai on 11 June 2010, LV Krishnan, CEO, TAM Media Research, said, "In our last meeting with the ministry last week, they did mention forming of a broadcasting body like TRAI to monitor the ratings and licences given to channels, in the near future. We need to work faster as the government has (alternative) plans."
TAM has certain guidelines to ensure that its sample TV ratings are measured accurately. It is in favour of working with the government as long as the intervention isn't too blatant.
"The government can surely help if they don't take an anti-industry stance. It can play a vital role in aiding or at least helping in reducing the taxes imposed on the expensive equipment required for measurement," said Mr Krishnan.
Does the industry feel that the government's intervention is required? "Actually there is a vested interest of the government (in intervening in the ratings of TV channels). DD believes that whatever ratings are done by TAM are under-measured," said Paritosh Joshi, CEO of Star CJ India. Sam Balsara, chairman, Madison World, agrees, "By regulation we mean self-regulation and not government intervention. Our fear is that if government gets involved, vested interests will also be involved because many members of Parliament also own channels."
The industry's inability in creating a responsible body to cater to ratings and licences has been hampering its own growth. The advertising industry is an almost Rs22,000-crore market whereas the TV ad market is only about Rs9,000 crore.
What is the main reason? "As far as ad agencies and advertisers are concerned, these kinds of conflicts are not persistent. And more than anything else the TV industry is dependent on advertising more than ratings," said Mr Balsara.
Broadcasters still argue that ratings done by TAM and other agencies are accurate because the goal is clear-measurement of viewership to help them work towards creating better content. As Mr Krishnan said, "As complexity of measurement increases, industry involvement also becomes essential. If the industry comes along and works hand-in-hand, we can work in a much better fashion." Unfortunately, the industry doesn't have a plan or blueprint of what the solution can be. Coming back to where we started-is government intervention really required?
ICICI Pru has launched an index fund based on the highly volatile Nifty Junior
Fund houses are in a race to launch index funds to shore up their assets under management (AUM). The latest to join is ICICI Prudential Mutual Fund which has floated a new open-ended fund named Nifty Junior Index Fund. The new fund offer (NFO) opened on 10th June 2010 and closes on 21st June 2010. ICICI had launched ICICI Pru Index Fund in February 2002. The scheme is benchmarked against the S&P CNX Nifty.
Over the past decade, there have been only about 20 index funds. But suddenly in the last few months, four new index funds have hit the market. Taurus Mutual Fund launched Taurus Index Fund; IDFC Mutual Fund introduced the passively managed IDFC Nifty Fund in April 2010; and in May 2010, IDBI Asset Management Company (AMC) launched IDBI Nifty Index Fund as its first fund offering.
ICICI Pru's fund will be benchmarked against the CNX Nifty Junior Index and will invest 90% of its corpus in the underlying Nifty Junior Index stocks and 10% in debt and money market instruments. The CNX Nifty Junior consists of 50 stocks and represents about 12% of the free-float market capitalisation as on 31 December 2009.
The scheme carries a 0.25% exit load if redeemed or switched less than seven days after investing. Investors can choose growth or dividend option. The Fund bears a maximum annual expense of 1.50%, depending on the corpus of the fund.
Index funds are supposed to exactly replicate their benchmark and outperform most actively managed funds.
Most of the index funds are benchmarked against Nifty or Sensex. The Nifty Junior index is much more volatile than these two main indices. Nifty Junior rises sharply in a bull run and falls as sharply when the market crashes. From the bottom of October 2008 to the peak of April 2004, the Nifty was up 113% whereas the Nifty Junior was up 206%. Earlier, the Nifty Junior had crashed 73% from January 2008 to October 2008 while the Nifty had declined 61% in the same period.
The Fund will compete against the much cheaper 'Junior BeES' launched by Benchmark Mutual Fund, which launched India's first mid-cap index fund in the year 2003.