Monday, February 14, 2011

Rupee weakens by 9 paise against US dollar in morning trade

MUMBAI: The Indian rupee fell by 9 paise to Rs 45.40 against the US dollar in early trade at the Interbank Foreign Exchange on Tuesday, weighed down by dollar gains against other currencies.

Forex dealers said dollar gains against the euro and other currencies mainly put pressure on the Indian rupee, but a higher opening in the stock market restricted the losses.

The Indian rupee ended 19 paise higher at 45.49/50 against the US currency yesterday on the back of a sharp surge in local equities amid sustained dollar-selling by exporters.

Meanwhile, the Bombay Stock Exchange benchmark Sensex rose by 72.06 points, or 0.40% to 18,274.26 in opening trade today.

TOI

Fertilizers up 15%, farm worry for govt

NEW DELHI: Just when UPA is under the hammer over food inflation, Union minister M K Alagiri has sounded alarm over shooting fertiliser prices under the Nutrient-Based Subsidy (NBS), saying the policy introduced last budget was hurting the poor farmer.

He said the experience of NBS in the fertiliser sector should halt the proposed price decontrol in the urea sector.

The DMK minister argued that urea was the most used fertiliser and decontrol of urea prices and a resultant spike would hurt 75% farmers who were small and marginal.

Alagiri had opposed the switch to NBS, but was disregarded. However, his red flag against urea decontrol may get more attention because of the rising food prices. A jump in urea prices will hurt farmers who helped Congress in the last Lok Sabha elections, and can add to the rising food prices.

In his letter to Prime Minister Manmohan Singh last week on urea decontrol, Alagiri had reminded him of his failed opposition to introduction of nutrient-linked subsidy for fertilisers.

An expert committee under Planning Commission member Saumitra Chaudhuri is examining the urea issue, but the final decision will be shaped more by the coalition leadership's political assessment.

The NBS regime which frees the fertiliser price and fixes the subsidy based on constituents of phospatic and potassic fertilisers kicked in after finance minister Pranab Mukherjee plumped in its favour. Five of the seven ministers including Alagiri in the Mukherjee-chaired Group of Ministers had opposed it. Even the cabinet meeting just before the budget 2010 which cleared the policy saw an extended debate with widespread concerns.

The government had dismissed fears of price rise by citing a commitment from the fertiliser industry that it would freeze the MRP for one year.

Ten months later, as Centre mulls extension of NBS to the urea sector, Alagiri has pressed the alarm button by writing to the PM and finance minister Mukherjee.

He told the PM that farmgate prices of P&K fertilisers have shot up by 15% or Rs 75 per bag of DAP fertiliser. His concern is while farmers have not benefitted, government too is losing with increasing subsidy bill. Holding up a warning sign, he said the departmental feedback indicated that fertilisers prices would increase further in the coming Kharif season.

For the son of Tamil Nadu chief minister M Karunanidhi with leadership stakes in April polls, the concern revolves around DMK's rivals blaming him for the policy under his charge in the Union fertilisers ministry.

While NBS for fertilisers seems unshakeable now, Alagiri has trained his guns on the regime's extension to urea. The Department of Fertilisers has demanded that New Pricing Scheme which expired in March should be extended for three years to give time for transition. Sources said Alagiri told the PM that the vacuum on pricing policy following expiry of the current one has triggered financial crunch in urea units, specially in southern states, and new investments over Rs 50,000 crore were on hold.

The alarm from the fertiliser minister over shooting prices may not be comfortable for Congress which is under attack for sustained food inflation. If the opposition makes it an issue, it can turn the tables on the party in rural areas, pockets that DMK is looking to gain in riding on the welfare schemes of the Karunanidhi regime.

TOI

Sensex rises 72 points in opening trade

MUMBAI: The BSE benchmark Sensex extended its gains by adding 72 points in opening trade today on continued buying by foreign funds and retail investors.

The 30-share index of the Bombay Stock Exchange, which rallied by nearly 740 points in the previous two sessions, rose by another 72.06 points, or 0.40% to 18,274.26 points in the first few minutes of trade today.

Likewise, the wide-based National Stock Exchange Nifty index moved up by 18.45 points, or 0.33%, to 5,474.45.

Brokers said sustained buying by funds and retail investors in stocks with strong fundamentals and covering-up of pending short positions by speculators mainly influenced the trading sentiment.

Capital goods, consumer durables and power stocks were in keen demand and accounted for most of the gains on the Sensex.

Stocks of ADA Group company, Rcom, however, were under some pressure and fell by 1.80% to Rs 95.65 in early trade. The firm had posted a 54.84% decline in net profit for the quarter ended December 31.

Meanwhile, Japan's Nikkei index was up 0.05%, while Hong Kong's Hang Seng index shed 0.48% in morning trade today.

TOI

Over 1 lakh phones are tapped every year

NEW DELHI: Some startling figures tumbled out on rampant phone tapping in the country when telecom service provider Reliance Communications told the Supreme Court on Monday that the authorities had asked it to tap 1.51 lakh phone numbers in a five-year span between 2006 and 2010.

This works out to an average of over 30,000 telephone interceptions every year by a single service provider on the orders of various law enforcing agencies. Or, over 82 telephones were intercepted every day by a single service provider.

Reliance is the second-largest service provider with a subscriber base of 12.57 crore as in 2010. The biggest service provider, Bharti Airtel, had 15.25 crore subscribers in 2010, while Vodafone's subscriber base was just a shade lower than Reliance's at 12.43 crore. State-owned BSNL came fourth with 8.67 crore subscribers.

If Reliance's ratio of phones tapped to the number of its subscribers were to be taken as representative and applied to other service providers, it is a fair assumption that government agencies were tapping more than one lakh phones every year.

In Delhi alone, Reliance tapped a total of 3,588 phones in 2005 when the teledensity was low compared to today. It also included Amar Singh's number which was put under surveillance — allegedly on a forged letter from Delhi Police.

Four days back, a bench of Justices G S Singhvi and A K Ganguly had expressed concern over the large number of interceptions being ordered by the agencies and the "grave danger" this posed to the citizen's right to privacy.

In an affidavit tendered by senior advocate Ram Jethmalani before the bench, Reliance Communications said: "The total number of interceptions in 2005 in respect of Delhi Service Area were 3,588. There were about 1.51 lakh number of cases for monitoring/interception during the period 2006-10 in all India."

Responding to the court's observation that no service provider worth its salt would intercept a phone based on a purported communication full of grammatical and spelling mistakes, Reliance said most of the genuine interception orders were identical to the now known forged letter as far as spelling and grammatical mistakes were concerned. It cited a genuine interception order of February 1, 2011, received from the Delhi Police to make its point.

After detailing the precautions it had taken, including writing to the authorities to authenticate the letter asking for interception of Amar Singh's phone, Reliance said it received no response, yet it was duty bound under a bona fide perception of the letter to continue interception for 15 days.

"A bare perusal of various letters sent by Ranjit Narayan (then Joint Commissioner of Delhi Police) and R Narayanswami (then Delhi home secretary) show that the letters dated October 22, 2005 and November 9, 2005 (both purportedly forged ones) were similar to other letters received from them," Reliance said while claiming its innocence in the interception controversy.

It said request for surveillance of a telephone from the law enforcement agencies could not be postponed based on spelling mistakes in the communication from agencies as it called for immediate action "for safety of general public at large and in the interest of the nation." It added: "Postponing compliance on the ground of inconsequential mistakes like spelling errors may conceivably lead to a serious terrorist attack and the blame may fall on us."

"The service providers are also required to provide assistance to law enforcement agencies as per the licence condition. Any violation of it can lead to a penalty of Rs 50 crore," Reliance said.

It said service providers do not keep a record of conversations taped from a phone under surveillance. Reliance Communication said it did not have the technology to record the conversations and that there was no law mandating the service provider to record the conversations and submit it to the law enforcement agencies.

TOI