Joint secretary in finance ministry Thomas Mathew said the power sector would now be able to raise ECBs for refinancing their rupee debt up to 40%, “provided the remaining 60% of the ECB raised is utilised for investment in a new project”
New Delhi: Power companies in a week’s time will be allowed to use up to 40% of external commercial borrowings (ECBs) to refinance their rupee debt as against the existing limit of 25%, reports PTI.
Also, the ECB route for capital expenditure on the maintenance and operations of toll systems in the roadways and highways sector will be opened within seven days.
“RBI is expected to issue relevant notifications within seven days giving effect to these Budget announcements,” joint secretary in finance ministry Thomas Mathew told reporters.
With an aim to address the “immediate financing concerns” of the civil aviation sector finance minister Pranab Mukherjee in his Budget speech had also proposed to permit up to $1 billion ECB for working capital requirements of the airline industry for a period of one year.
To queries on timeline for the ECB for airlines, Mr Mathew said a decision in this regard is expected “next week ... (probably on) 26th April”.
So far, airlines were allowed to raise foreign capital only for import of capital equipment like aircraft.
Giving details of liberalisation of the ECB norms for the power sector, Mr Mathew said the segment would now be able to raise ECBs for refinancing their rupee debt up to 40%, “provided the remaining 60% of the ECB raised is utilised for investment in a new project”.
In view of the increasing capital requirement of the power sector, finance minister Pranab Mukherjee had, in his Budget Speech, announced liberalisation of the ECBs for refinancing of the rupee debt for the sector.
The decision on allowing ECB for toll systems is likely to provide a fillip to the road sector and augment avenues for financing of such projects.
It is expected to provide an additional source of low-cost capital and encourage greater investment in road construction projects. Besides, it may further encourage public private partnerships in the sector.
ECB, which totalled $35.9 billion in 2011-12, is considered attractive as cost of raising the loan is lower than that of domestic borrowing.
The notification follows the announcement made by RBI governor D Subbarao in the annual credit policy which was unveiled on Tuesday
Mumbai: The Reserve Bank of India (RBI) on Wednesday issued a notification to reduce the bank rate or the interest the banks and financial institutions pay to the central bank on borrowed funds to 9% from 9.5% now, reports PTI.
“The Reserve Bank of India (RBI) has decided to lower the bank rate to 9% per annum from 9.5% per annum with effect from 17 April 2012,” the RBI said in a statement.
The notification follows the announcement made by RBI governor D Subbarao in the annual credit policy which was unveiled on Tuesday.
In line with 0.5% cut in short-term lending (repo) rate, the RBI also reduced the bank rate to 9%.
The RBI decided to reduce the benchmark repo rate to 8% from 8.5%, after a gap of three years, to promote growth which during 2011-12, which slipped to a three year low of 6.9%.
The central bank has pegged the GDP (gross domestic product) growth rate for the current fiscal at 7.3%.
Any small incident like signal failure can bring the suburban rail network across Mumbai to a halt. The question, however, is why the Railways do not have any backup system in place?
Just two days ago former railway minister Dinesh Trivedi, while speaking at an event organised by Moneylife Foundation had said that the entire railway system is in mess and there is a urgent need to modernize it so that people can travel safely with some dignity, unlike what every commuter, especially on Mumbai local trains experience every day.
He saw the signs and last night a fire in a signal cabin near Kurla station created huge problems to daily commuters on the Central Railway (CR) network on Wednesday. It took me nearly four hours to reach Dadar from Kalyan, despite travelling in a mail/express instead of suburban rail (local in Mumbai lingo). All through my journey today (what seemed to be endless) I was thinking about the vulnerability of Mumbai rail network, and suddenly realised that I was forewarned by the former rail minister himself.
Mr Trivedi said, “There are no maintenance contracts given by the Railways and they are carrying out even the basic repairs on ad-hoc basis." This is the reason, why you, me and every daily commuter on Mumbai local suffers, whether it is rains or no rains.
And this is what Mr Trivedi has prescribed, sorry, proposed in his Rail Budget. He wanted to modernise the railway network, improve efficiency of its services and therefore proposed a passenger fare hike. "There is dirt on the tracks, the toilet system corrodes the tracks and the Railway Protection Force, many of the times, tries to loot people. But to change all this we need a paradigm shift and I was trying to make a beginning,” he had said.
So what really happened this time? According to the CR officials, there was a midnight fire in a signal cabin near Kurla station which caused heavy damage to signalling gears. The fire was brought under control but there is no quick respite for replacing the damaged gears and cables. It will take the Central Railways more than three days to bring all its services back to normal, they said.
Here please don't consider ‘normal’ as normalcy. For CR, normalcy means all locals running late by 10 to 15 minutes every day and for that they don’t give the damn to the commuters. For example, the 8.43am Kalyan to Chhattrapati Shivaji Terminus (CST) Fast local is scheduled to reach Dadar station at 9.29am. I am travelling in the same local since the past many years and have never found it reaching Dadar at its designated time. The local always reaches Dadar only after 9.35am and never before. The train runs at normal speed, but the problem is its ‘unofficial’ halts. All local trains on CR passing through Thane are ‘mandatorily’ halted before the station for reasons known only to the Railways.
While coming towards CST, all local trains are halted near the bridge on Thane Creek and while going toward Kalyan all trains are mandated to take a halt near the Kopri Bridge. In fact, with my experience and that of several other fellow commuters, we can say that Thane has become the bottleneck on Central Railway’s suburban network. Unfortunately, nobody wants to address this issue, which can save precious time for commuters as well as the Railways.
Coming back to today's journey, although I had to spend three times more than my regular travel time, it was not that bad because I travelled in a mail and not in local train. Those who travelled in local trains could be seen cursing themselves and were walking on the tracks as the trains were simply not moving.
But again, this brings us to the main question. Has the local rail network in Mumbai so become vulnerable that even a small incident like a signal failure can bring the entire system to a halt?
The midnight fire in a signal cabin near Kurla burnt down signal gears and cables. But then what about the back up? Why is there no backup system in place? Why on earth is the Central Railways running its entire system on a single line of resources?
Every monsoon, there are water-logging incidents on the railway tracks in Mumbai. Every year, both the Railways and Brihanmumbai Municipal Corporation (BMC) claim that they had cleaned all the nullahs and cleared all debris from the gutters, on and near the rail tracks. And yet every year, except a few years when BB Modgil was in charge of CR, we witness water-logging on railway tracks, which affects trains services and thus commuters. Mr Modgil, during his tenure as general manager of Central Railway, used to start the monsoon work as early as March and finish it by last week of May. Unfortunately, after his retirement, the Railways and BMC are back at their schedule to carry on monsoon work till the rains arrive and then stop it.
So what can we, the daily commuters and sufferers do? As Mr Trivedi, the former Rail Minister had said, we should insist that the original Rail Budget gets passed in Parliament. "People should meet their Members of Parliament (MPs) and demand that it (the original Rail Budget) should be passed for improving the Railways. You can approach your chief ministers, particularly from Maharashtra and ask him what would happen to the projects that are proposed in the Rail Budget?” Mr Trivedi had said.
I think we need to ensure that the money we spent on our train travel is well used in improving the present infrastructure, improving the quality of travel and the facilities available at all stations of the Indian Railways.