Money & Banking
RBI rules out introduction of Islamic banking in India

RBI governor said introduction of Islamic banking is not possible in the absence of a separate law, however, the central bank can look at other methods for channelizing funds from NRIs based on the principles of Islamic law

Kochi: Reserve Bank of India (RBI) Governor D Subbarao ruled out introduction of Islamic banking in the country but said other methods for channelizing funds based on the principles of Islamic law can be looked at, reports PTI.

 

"Islamic banking is not possible", he said, adding the central bank could look at other vehicles based on Islamic banking principles to channelize funds from non-resident Indians (NRIs).

 

Replying to a question on the issue, Subbarao said: "There are some legal problems. We have studied the issue. We appreciate the objectives behind the request. But there are some legal problems. It can be got around not through banking, but other vehicles".

 

He said that introduction of such banking was not possible in the absence of a separate law for Islamic banking.

 

The RBI chief further said the state Chief Minister Oommen Chandy had told him that there were several NRIs in the southern Indian state of Kerala who wanted to contribute to the development of the state and that there should be a mechanism for channelising their funds.

 

To questions on inflation, Subbarao said: "I will talk about inflation later. I will only say that our next mid quarter monetary policy review is on 18th December. Last policy review was on 30th October".

 

In view of the high inflation, the Reserve Bank in its last policy review refrained from reducing interest rates, though it did cut the Cash Reserve Ratio (CRR) by 0.25%, releasing Rs17,500 crore of primary liquidity into the system.

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Suzlon Group wins 39.9MW orders from GSFC, BEL

The 39.9MW projects comprise 19 units of Suzlon's S95 2.1 MW wind turbines to be supplied to Gujarat State Fertilizers and Chemicals and Bharat Electronics


Bangalore: Wind turbine manufacturer Suzlon Group has received contracts for 39.9 MW projects from Gujarat State Fertilizers and Chemicals Ltd and Bharat Electronics Ltd, reports PTI.

 

The projects comprise 19 units of Suzlon's S95 2.1 MW wind turbines, the company said. It signed a contract for 29.4 MW with GSFC and for 10.5 MW with BEL.

 

The new order would take GSFC's total installed capacity to 152.80 MW in sites across Gujarat, and that of BEL to 13.5 MW in Karnataka, the company said in a statement.

 

"The S9X product suite being supplied to BEL and GFSC is a proven workhorse in Suzlon's product portfolio and has received an enthusiastic response from the market globally, with an expanding order base of over 1.4 GW," the company said.

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Banks are rigid to give loans to road projects

According to the Road Secretary, banks have become more conservative and rigid and they are urging the lenders not to become more restrictive than what is required as part of the Model Concession Agreement

New Delhi: A "conservative" and rigid approach by banks and hurdles in environment clearances are among the issues that are holding back investment and private companies' participation in the road sector, Road Secretary AK Upadhyay said, reports PTI.

 

The official said that there are a number of issues which are holding back investment and private participation in the sector. "Environment clearance, financing and also there is lack of equity capital in the sector," Upadhyay told reporters.

 

"The banks have become more conservative and rigid and we are trying to convince them, also urging them to not become more restrictive than what is required as part of the Model Concession Agreement," he said on the sidelines of a PHD Chamber event.

 

Inviting more participation from the private sector in the road sector, Upadhyay said that the private companies should play a supplementary role to the government.

 

"They should be playing a supplementary role to the government as their risk taking ability is more," he added.

 

On being asked about the road building target for the current financial year, Updhayay said that the ministry has so far awarded projects stretching across 1,100 km.

 

"We have done about 1,100 km, target is 8,800 km for this year (2012-13)," he said adding that last year we awarded 62 projects totalling 8,000 km, entailing an investment of Rs 16,000 crore. .

 

He added that of the 8,800 km projects to be awarded this year, 4,000 km would be public funded through the EPC (engineering, procurement and construction) mode.

 

"We have a lot of public funded projects in these projects .. 4,000 km would be public funded through EPC, rest is PPP (Public Private Partnership)," he added.

 

The government, in August, approved the EPC model agreement document for construction of 2-lane national highways.

 

As per the EPC document, all the national highways works which are not done on PPP mode [BOT (Toll) or BOT (Annuity)] would be done primarily through EPC mode.

 

The EPC document has been structured in a manner that time overrun and cost overrun in implementation of national highways works shall be minimised to a great extent and there will be optimisation of design and quality construction.

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