The RBI has decided to withdraw the facility of re-booking forex contracts by companies and FIIs and reduced across-the- board exposure limits of banks which are authorised to deal in the foreign currency
Mumbai: The Reserve Bank of India (RBI) on Thursday swung into action to check slide in rupee value against dollar and speculations by imposing restrictions with immediate effect on forward trading in the local currency by foreign institutional investors (FIIs) and traders and capped banks exposure to the forex market, reports PTI.
The RBI has decided to withdraw the facility of re-booking forex contracts by companies and FIIs and reduced across-the- board exposure limits of banks which are authorised to deal in the foreign currency.
The central bank said these steps have been taken in view of the “developments in the foreign exchange market”. The rupee on Thursday slipped to the sub-54 level for the first time in its history and touched a low of 54.30 against the dollar. In the last nearly four and half months, the rupee has declined by about 20% against the dollar.
The forward contracts booked by resident, irrespective of the type and tenor of the underlying exposure, “once cancelled cannot be re-booked”, RBI said in a notification.
It has also reduced the limit for hedging of foreign currency risks for importers/exporters from 75% to 25% of the average actual import\export turnover in the past three years.
It further said all the forward contracts booked by exporters and importers would be on “fully deliverable basis.
In case of cancellations, exchange gain, if any, should be passed on to the customer”.
Besides, authorised dealers have been asked by the RBI to ensure that all transactions on behalf of their clients would be on actual remittances and delivery basis and could not be cancelled and settled in cash.
FIIs have been barred from re-booking of cancelled forward contracts. However, they can roll over such contracts on or before maturity.
The central bank also said the board of directors of authorised dealer banks would reduce overnight exposure limit for treasury operations.
“Net Overnight Open Position Limit (NOOPL) of authorised dealers would be reduced across the board. Revised limits of individual banks are being advised to the authorised dealers separately,” it said.
According to the circular, authorised dealer banks would not be allowed to exceed the NOOPL limit during the intraday trade.
Describing the RBI’s decision as a “very proactive step”, NS Venkatesh, treasury head of IDBI Bank, said, “It will cool the forex market and help in curbing speculation and reducing volatility. Normal demand (of dollar) will only be met.”
On the outlook of rupee, he said, “I expect the rupee to open tomorrow at Rs53 level from the close of Rs53.64 and hover around Rs52.50- Rs53 per dollar.”
A person who always tells the truth will always be honest but a person who tells lies or is deceitful in important matters will always be dishonest and will be fertile ground for giving and taking bribes
What is truth, asked jesting Pilate and would not stay for an answer.—Sir Francis Bacon (circa Shakespeare) “Essay on Truth”
“White Man speak with forked tongue”. A classic sentence, one I always loved, in the fiction genre called “Westerns” which documented the Americans’ savage conquest of their Wild West. The “forked tongue” is a metaphor for the white man’s perennial habit of saying one thing to the Red Indians and meaning exactly the opposite. The credulous Red Indians believed what the white man said and were destroyed by the while man’s deceit, dishonesty and treachery.
Come to India, there are lakhs of people who “speak with forked tongue”—mostly the politicians, the bureaucrats, the petty babus in the taluka offices, businessmen and their “corporate communications” people, traders, etc. I will give two examples of “forked tongues” and go on to show that truth and honesty are indivisible and the obverse that lying and deceit are inseparable from dishonesty and crimes like graft, bribery, under-the-table payments, etc.
I do not know the technical aspects of the philosophical logic that proves these statements. But these are observable facts which the philosophers will confirm in their own way.
In sum, a person who always (or 99% of the time, for perfection is impossible) tells the truth will always be honest. He will be incorruptible and blow the whistle when he comes across bribery or graft. A person who tells lies or is deceitful in important matters will always be dishonest and will be fertile ground for giving and taking bribes.
Now, the examples. Many months ago, Salman Khurshid told the world with utmost conviction that Loop Telecom had no connection with the Essar group of the Ruias, though the whole world knew otherwise. Mr Khurshid was proved wrong the Central Bureau of Investigation (CBI) which has filed a case that establishes that Loop Telecom is a creation of the Ruias. (Please see 2gscam.co.in, a website that has been around since the news of the scam first broke and gives us the “A to Z’ of the scam).
Why did Salman Khurshid say something which he knew was patently a lie? Who knows? But whatever the reason, his statement raises suspicions.
Now, we come to Kapil Sibal. A second lead report in the Times of India of about three weeks ago reads thus:
“Mumbai: A telecom company can be penalized anything between nil (sic) and Rs50 crore for violating rules. But bureaucrats are so worried of being accused of corruption that they are levying the maximum amount, almost as a rule. Nor is there any chance of the fine being lowered by the minister, who is equally reluctant to invite charges of graft.”
“The pervasive fear of being persecuted for decisions, even those intended in the right spirit, is preventing many top officials and Ministers from taking much-needed steps, said Mr Sibal, Union minister for communications and human resource development. He was speaking at the discussion on the “Agenda for Reform” at the Economic Times Awards for Corporate Excellence.”
Not only is Mr Sibal deceitful and intellectually dishonest, he is excruciatingly and outrageously funny, like something out of “Monty Python”, the great satire on British TV. And it is a short step, as we have shown, from dishonesty to something far more damaging to the country and the people.
I am not saying that Mr Khurshid and Mr Sibal are crooks. I am saying that lies and dishonesty are the basis for all the scams—2G (second generation), illegal iron ore mining, the Securities and Exchange Board of India’s (SEBI) system of settlements to let off proven offenders, even criminals, with a financial rap on the knuckles, etc.
To be fair to Mr Khurshid and Mr Sibal, one could say that, as lawyers, they are so habituated to defending the indefensible that they are unable to keep that compulsion out of public life.
So, here is a tip for the Lokpal-to-be, the Lokayuktas and the crime busters like the CBI: if you find that a guy is lying, be sure that he is basically dishonest and his psyche definitely tends towards crime.
Gas production from the Dhirubhai-1 and 3 gas fields and the MA oilfield in the KG-DWN-98/3, or KG-D6, block in the Bay of Bengal stood at 39.80 mmscmd in the week ended 4th December, RIL said in its weekly status report to the oil ministry
New Delhi: Reliance Industries (RIL) has reported a decline in natural gas output from its eastern offshore KG-D6 fields to a two-year low of 39.80 million metric standard cubic metres per day (mmscmd), reports PTI.
Separately, oil minister S Jaipal Reddy told Parliament that as many as six wells in the Krishna-Godavari basin KG-D6 block have ceased gas production due to water-loading and sand ingress.
Gas production from the Dhirubhai-1 and 3 gas fields and the MA oilfield in the KG-DWN-98/3, or KG-D6, block in the Bay of Bengal stood at 39.80 mmscmd in the week ended 4th December, RIL said in its weekly status report to the oil ministry here.
The output, which comprised 32.94 mmscmd from the D1 and D3 gas fields and 6.86 mmscmd from the MA oilfield, is lower than the 40 mmscmd that RIL achieved within 90 days of the commencement of production on 2 April 2009.
KG-D6 production touched 61.5 mmscmd in March last year before a drop in pressure in the wells and water-loading/sand ingress led to a fall in per-well gas output.
“The Directorate General of Hydrocarbons (DGH) has reported that the reasons for the decline in gas production from D1 and D3 is due to drilling of only 22 wells, as against the 31 producing wells approved for drilling up to March, 2012, as per the field development plan (FDP),” Mr Reddy said in a written reply to the Lok Sabha.
Of the 22 wells drilled, four wells have not been put on production, he said, adding that the DGH has not agreed with RIL’s argument that geological complexities prevented it from drilling more wells.
The DGH, the technical advisor to the oil ministry, has asked RIL to “comply with the approved FDP by drilling more number of gas-producing wells in the D1 and D3 gas fields and achieve the FDP-approved gas production profile,” Mr Reddy said.
The output from KG-D6 is short of the 70.39 mmscmd-level (61.88 mmscmd from D1& D3 and 8.5 mmscmd from the MA field) envisaged by now as per the FDP approved in 2006. D1 and D3 output was to touch a peak of 80 mmscmd by March 2012.
“The contractor (RIL) has neither drilled the remaining nine producing wells nor taken any alternative action such as revisions of the FDP for approval of the Management Committee (MC) as per the provisions of the Production Sharing Contract,” he said.
The Management Committee is an oversight body comprising representatives of the contractor, the DGH and oil ministry.
“In addition, five out of total 18 gas producing wells in D1&D3 fields have ceased to produce gas due to water-loading/sand ingress in the wells. One oil/gas producing well in the MA field out of six oil/gas producing wells has ceased to produce oil/gas due to water-logging in the well,” Mr Reddy added.
In the status report, RIL projected an output of 39.50 mmscmd of gas during December.
The RIL report said of the 18 wells drilled, completed and put on production in the D1 and D3 fields, four wells—A2, B1, B2 and B13—had to be shut or closed due to high water cut/sanding issues.
While RIL holds 60% interest in KG-D6, UK’s BP Plc holds 30% and Niko Resources of Canada the remaining 10%.
RIL started natural gas production from the KG-D6 fields in April 2009, with an output of 30 mmscmd from eight wells. This quickly rose to 40 mmscmd within 90 days.
By the October-December quarter, production had reached 60 mmscmd and RIL successfully tested the design capacity of the production facilities for handling 80 mmscmd of gas.
The MA oilfield currently produces about 12,715 barrels of crude oil per day. In addition, 1,831 barrels of condensate are produced from the field every day.
The report said 14.89 mmscmd of the gas output is being sold to fertiliser plants and 22.02 mmscmd to power plants.
The remaining 2.89 mmscmd is consumed by other sectors, including those fed by the East-West pipeline that transports gas from the East Coast to consumption centres in the West.
As per the status report, out of the 22 wells planned in Phase-I of D1 and D3 field development, 18 wells have been drilled and completed so far. Of these, 14 wells were put on production, while four wells were kept closed due to high water cut and sanding issues.