LIC seeks price secrecy for IPO, FPO bids

LIC did not get a single share in the REC FPO as other investors put in bids above Rs205 in the last few minutes of the closing of the issue, which prompted the insurer to write to the market regulator to take steps to ensure secrecy in the bidding process

State-owned insurer Life Insurance Corporation of India (LIC) has written a letter to the Securities & Exchange Board of India (SEBI) recently, asking for price secrecy in the bidding process for initial public issues (IPOs) and follow-on public issues (FPOs), reports PTI.

"LIC wrote a letter to SEBI after the Follow-on Public Offer (FPO) of the Rural Electrification Corporation (REC) in March this year, asking the regulator for price secrecy in the French auction bids of institutional investors," the source closely connected to the development told PTI here.

French auction gives institutional investors the freedom to place bids above the floor price and preference is given to those with higher bids.

However, LIC has said disclosure of bid prices gives unnecessary advantage to last minute entrants as in the case in the REC FPO.

For the REC FPO, the floor price was fixed at Rs203 and LIC had put in bids worth Rs3,000 crore at Rs205, Rs2 more than the floor price at a time when the demand was low.

However, LIC did not get a single share as other investors put in bids above Rs205 in the last few minutes of the closing of the issue, the source said, adding, "It was a big blow to the corporation and exposed the weakness of the system."

"To avoid any such scenario in the future, we have requested the regulator to take steps to maintain price secrecy as it will help institutional investors who quote first and also the government to get a better valuation well above the floor price," he said.

"We have requested the regulator to take steps to ensure secrecy in bidding as it happens in any other kind of bidding process," the source said.


SC refuses to hear BoR shareholders' plea against merger

Three major employee unions of BoR have called for a two-day strike demanding the immediate termination of the ICICI-BoR merger

A two-judge vacation bench of the Supreme Court (SC) today declined to hear a petition filed by shareholders of the Bank of Rajasthan (BoR), who were objecting to the financial institution's merger with ICICI Bank, reports PTI.

The bench, comprising Justice G S Singhvi and C K Prasad, said that the petitioners may approach another bench as it will not entertain the case.

On 23rd May, ICICI Bank had approved the merger of the Bank of Rajasthan through share-swap in a non-cash deal that valued BoR at about Rs3,000 crore.

Though 25 ICICI shares would be offered with every 118 shares of BoR, promoters Tayal family-which have over 50% stake-would not get a seat on the amalgamated entity's board.

The proposed merger is being opposed by BoR employees. Three major employee unions of BoR-All India Bank of Rajasthan Employees Federation (AIBOREF), All India Bank of Rajasthan Officers' Association (AIBORA) and Akhil Bhartiya Bank of Rajasthan Karmchari Sangh (ABBORKS)-have called the strike demanding the immediate termination of the ICICI-BoR merger proposal.

"We have decided to strike work on 4 and 5 June. If the authorities do not heed to our demand, we will again go on a three-day strike beginning 17th June. All branches of BoR and over 4,000 employees will participate in the strike," AIBOREF, president, Dharmendra Rao told PTI.

"The work culture of both banks are extremely different and it will be difficult for our staff, who are used to the culture of BoR for decades, to integrate with ICICI Bank. There is no guarantee that our jobs will be protected," Mr Rao said.



UK scraps National ID project; Will India's UID face the same fate?

According to some experts, the least that needs to be done is that UIDAI should make a comprehensive case to justify why what was rejected in the UK is good for India

The Unique Identification Authority of India (UIDAI) has been busy assembling bits and bytes for its ambitious citizen identification (ID) project. However, in another part of the world, a similar identification project has now been scrapped by none other than the UK government. This has given a boost to pro-privacy architects in India who are worried about the privacy implications of the UID project.

The scrapping of the National ID programme by the new government in the UK was not unexpected.  Many people, organisations and even some politicians were questioning the viability of the NID project. According to a BBC report, the NID scheme was aimed at tackling fraud, illegal immigration and identity theft—but it was criticised for being too expensive and an infringement of civil liberties.

Theresa May, UK's home secretary, was quoted as saying that the NID will be abolished within 100 days with all cards becoming invalid. The new government would put legislation to this effect before Parliament with an aim to make it a law by August. Around 15,000 people who voluntarily paid £30 for a card since the 2009 rollout in Manchester, will not get a refund, the BBC report says.

What’s interesting is that the UK government has cited higher costs, impracticality and ungovernable breaches of privacy as reasons for cancellation of the NID project. These reasons may have a similar kind of impact in India as well.

According to some experts, the least that needs to be done is that UIDAI should make a comprehensive case to justify why what was rejected in the UK is good for India. They feel surprised about why the media has not publicised the reports that the UK has rejected the UID primarily because of concerns regarding civil liberties.

"One hopes that the UID-related contracts awarded already to E&Y and MindTree do not have any lingering after-effects, should commonsense (we don't have a great track record in commonsense, especially where money is concerned, but it's never too late to hope) hit our government and the UID agency be asked to pack up its tents," said one expert.

While announcing the abolition of NID in the UK, Ms May said, “This Bill is a first step of many that this government is taking to reduce the control of the state over decent, law-abiding people and hand power back to them. With swift Parliamentary approval, we aim to consign identity cards and the intrusive ID card scheme to history within 100 days."

Back home, according to UIDAI, the first UID numbers will be issued from August 2010. Over five years, the Authority plans to issue 600 million UIDs. The numbers will be issued through various ‘registrar’ agencies across the country, UIDAI said on its website.

Finance minister Pranab Mukherjee had sanctioned Rs1,900 crore for the UIDAI in his budget for FY10-11. According to a document on UID numbering available on UIDAI's site, systems that are to be as widely used and for multiple different applications as UID, tend to be very sticky in the sense that these systems would be in active use for centuries. Once a billion plus people have been assigned a UID, and applications using the UID to conduct their transactions are evolved, anything that requires modifications to existing software applications and databases will cost a lot.

Over eight years, the UK government spent around £250 million on developing the national ID programme. However, its abolition means the government will avoid spending another £800 million over a decade. The NID was launched in July 2002 and as of February 2010, its total costs rose to an estimate of £4.5 billion.

The Cost of the UID project may not be a hindrance for the Indian government, whose accounts are flush with money from the 3G auction, but what about its impact on civil liberties? Will there be a comprehensive discussion on the subject? One can only hope that the Indian government and the UIDAI closely study the reasons for the UK government’s decision to scrap its National ID project and then provide compelling reasons for India to go ahead with its UID project.




3 years ago

Two projects that the UK government really needs to implement is a National Healthcare program that will bring down healthcare costs. Increase competition as well as reduce paperwork!
The other a National Online ID system that police can use to cut crime as well as benefit agencies being able to cut fraud!


5 years ago



6 years ago

After reading several interviews, blogs & posts regarding this projects my impressions are:
1. This project is absolutely needed.
2. One the greatest challenges of this project will be people who do not want their ID to be revealed for justified reasons. Consider this example:
Suppose someone ran away from a home in a village area in India because of caste related violence. Suppose this person is now living in a big city with a new (false) ID. And suppose exposing the true ID will risk his/her life, or the life of family members. Having this project, there will be only two options:
Lying about ID to get the number. Or, not getting the number and being, eventually, excluded from having a bank account, medical care, and so on. Having false identity will mean danger of police abuse, and the severe laws of misusing the number will make it worse.
Possible solution: have another project within the UID project to solve this problem. Suppose, 'IDP' or 'ID protection program', where the person will be allowed to give a false name, only in court it could be revealed that the name is false.

Mitun Chowdhury

6 years ago

I am proud of UID card project. India will be one step ahead many counties in coming years. I lived in Japan, Australia, USA, Canada, Ukraine. I have seen many id related problems and few solutions. I believe, UID is a just and clever solutions of all Indians.


6 years ago

This country is attacked from all sides. Its very eistence is at?? People talk of civil liberties and all that stuff. But to whaT EXTENT? It has become a fashion to talk about these things. I am not advocating a police or oppresive regime. What about Social Security Number assigned to everyone in US? Is it in anyway infringing freedoms and liberties? UK Govt might have seen only from the 'affordability angle'. We do not know. It requires wide discuasion among the masses. Not only among politicians, govt. servents and intelegentia. - Arthachakra


6 years ago

if it does not work for england, it probably won't be good for india!! what kind of logic is that ... the only objection raised by the author is about civil liberty .. the US has the social security number which does not perturb anyone .. you should present more valid arguments rather than churning out this banal stuff

Naresh Mani

6 years ago

In my humble opinion the author seems to have gone completely awry with interpretation of the UID. The author’s dogmas (for the lack of a better word!) are completely misplaced about the UID and its best that he/she puts it to rest.
United Kingdom, unlike India already has a comprehensive identification process through the National Insurance and NHS. Each and every citizen of UK is accounted for, unlike the case in India.
For the UK it is the case of making no sense to add another large scale biometric identification program when one already exists. Further, UK do not have more than 40% (official) illiterates, making it impossible to identify one from another.
The UIDAI program tries to satisfy the very basic and fundamental need of an Indian, to have an identity. I would applaud Mr. Nilekani to have chartered on such a difficult path and I would wish him the very best in his endeavours.
Privacy concerns though not completely irrelevant, are secondary. Google collects much more information about individuals, but I have not seen anyone in India raising a hue and cry about the same.

K B Patil

6 years ago

Our people are used to being treated like cattle. That is the reason why no hue and cry is being raised over the issue of privacy and rights of citizens. With our HM known for his advocacy of strongarm tactics, is there any chance of a thorough discussion? The only silver lining is that Nandan Nilekani is a sincere man.

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