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Indian Economy-News & Updates
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Ruag
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Arcelor Mittal enters India
Arcelor unit takes stake in India's Uttam Galva | Industries | Industrials, Materials & Utilities | Reuters
Arcelor unit takes stake in India's Uttam Galva | Industries | Industrials, Materials & Utilities | Reuters
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Indian foreign reserves rise to $276.3 billion
The Hindu Business Line : Forex reserves rise to $276.3 billion
The Hindu Business Line : Forex reserves rise to $276.3 billion
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Drought a 'hiccup' in India growth story: analysts
By Penny MacRae (AFP) 9 hours ago
NEW DELHI India's economy may stumble due to a widespread drought but analysts say it is set to return to strong growth in the medium-term thanks to its huge population and infrastructure spending.
The poor rains are "a near-term hiccup in the evolving rise of the Indian economy," said Rajeev Malik, economist at Australia's Macquarie Securities.
Analysts are betting demand generated by India's population of nearly 1.2 billion people and the need to modernise its dilapidated airports, roads, ports and other infrastructure will keep Asia's third-largest economy humming.
"Like China, India has ample long-term growth potential, especially with its large population and vast underdeveloped areas," said Sherman Chan, economist at Moody's Economy.com.
India has an ambitious target of investing 500 billion dollars during a five-year period to 2012 to update transport links and other services.
Even though it is flagging badly on reaching that goal, "the need to improve infrastructure will keep overall economic activity buoyant in coming years," said Chan, who sees India's growth back at nine percent levels by 2012-13.
Data last week showed the economy grew by 6.1 percent year-on-year in the three months to June, picking up pace from the previous quarter when it expanded by 5.8 percent.
The numbers signalled the emergence of Asia's third-largest economy from the global downturn, albeit at a slower rate than giant neighbour China which grew 7.9 percent in the same period, analysts said.
The expansion has been spurred by government stimulus and aggressive monetary easing that has made loans cheaper.
The drought, which has gripped nearly half of India's 626 districts, could slow growth in coming quarters though.
"The second quarter (July-September) will be worse and maybe the third quarter also" with growth only picking up in the fourth quarter, top government economic planner Montek Singh Ahluwalia said.
He projected growth of 6.3 percent for this fiscal year to March 2010, down from 6.7 percent the previous year and from at least nine percent in the previous three years.
But even that is a remarkable performance, say analysts.
Despite the combination of drought and the fallout of the global financial crisis, expected growth in 2009-10 of more than six percent is better than that seen during other dry spells, T.N. Ninan, columnist of leading financial daily Business Standard pointed out.
"Compare that with growth in previous drought years -- four percent in 2002-03, 3.3 percent in 1987-88. In the 1970s, GDP (gross domestic product) used to actually shrink in drought years," he said.
"In all the dust raised by the mayhem of a world in crisis, we have missed seeing the real story -- which is the strength and bounce there is now in the Indian system."
Car sales testify to the economy's vigour, analysts say.
Total sales of India's largest carmaker Maruti Suzuki, majority-owned by Japan's Suzuki Motor, rose 41.6 percent to 84,808 vehicles in August, according to new figures.
And two newly published indices measuring services and manufacturing showed continued expansion.
"I don't think the drought will mess up growth prospects too much," said Dharmakirti Joshi, economist at ratings agency Crisil. "While agriculture growth will be hit, other areas will pick up, such as industry."
Still, the drought has brought misery for farmers and driven up food prices, threatening a flare-up of dormant inflation.
Spending on drought relief measures could also raise India's already wide projected budget deficit of 6.8 percent of GDP -- the highest in 16 years, analysts say.
But despite setbacks, the country's economic Planning Commission forecasts growth could be eight percent next year and nine percent in 2011-12, the minimum the government says is needed to help relieve still crushing widespread poverty.
"The long-term India 'growth' story hasn't died -- it's simply delayed by the weather gods," said Deepak Lalwani, India director at London's Astaire and Partners brokerage.
By Penny MacRae (AFP) 9 hours ago
NEW DELHI India's economy may stumble due to a widespread drought but analysts say it is set to return to strong growth in the medium-term thanks to its huge population and infrastructure spending.
The poor rains are "a near-term hiccup in the evolving rise of the Indian economy," said Rajeev Malik, economist at Australia's Macquarie Securities.
Analysts are betting demand generated by India's population of nearly 1.2 billion people and the need to modernise its dilapidated airports, roads, ports and other infrastructure will keep Asia's third-largest economy humming.
"Like China, India has ample long-term growth potential, especially with its large population and vast underdeveloped areas," said Sherman Chan, economist at Moody's Economy.com.
India has an ambitious target of investing 500 billion dollars during a five-year period to 2012 to update transport links and other services.
Even though it is flagging badly on reaching that goal, "the need to improve infrastructure will keep overall economic activity buoyant in coming years," said Chan, who sees India's growth back at nine percent levels by 2012-13.
Data last week showed the economy grew by 6.1 percent year-on-year in the three months to June, picking up pace from the previous quarter when it expanded by 5.8 percent.
The numbers signalled the emergence of Asia's third-largest economy from the global downturn, albeit at a slower rate than giant neighbour China which grew 7.9 percent in the same period, analysts said.
The expansion has been spurred by government stimulus and aggressive monetary easing that has made loans cheaper.
The drought, which has gripped nearly half of India's 626 districts, could slow growth in coming quarters though.
"The second quarter (July-September) will be worse and maybe the third quarter also" with growth only picking up in the fourth quarter, top government economic planner Montek Singh Ahluwalia said.
He projected growth of 6.3 percent for this fiscal year to March 2010, down from 6.7 percent the previous year and from at least nine percent in the previous three years.
But even that is a remarkable performance, say analysts.
Despite the combination of drought and the fallout of the global financial crisis, expected growth in 2009-10 of more than six percent is better than that seen during other dry spells, T.N. Ninan, columnist of leading financial daily Business Standard pointed out.
"Compare that with growth in previous drought years -- four percent in 2002-03, 3.3 percent in 1987-88. In the 1970s, GDP (gross domestic product) used to actually shrink in drought years," he said.
"In all the dust raised by the mayhem of a world in crisis, we have missed seeing the real story -- which is the strength and bounce there is now in the Indian system."
Car sales testify to the economy's vigour, analysts say.
Total sales of India's largest carmaker Maruti Suzuki, majority-owned by Japan's Suzuki Motor, rose 41.6 percent to 84,808 vehicles in August, according to new figures.
And two newly published indices measuring services and manufacturing showed continued expansion.
"I don't think the drought will mess up growth prospects too much," said Dharmakirti Joshi, economist at ratings agency Crisil. "While agriculture growth will be hit, other areas will pick up, such as industry."
Still, the drought has brought misery for farmers and driven up food prices, threatening a flare-up of dormant inflation.
Spending on drought relief measures could also raise India's already wide projected budget deficit of 6.8 percent of GDP -- the highest in 16 years, analysts say.
But despite setbacks, the country's economic Planning Commission forecasts growth could be eight percent next year and nine percent in 2011-12, the minimum the government says is needed to help relieve still crushing widespread poverty.
"The long-term India 'growth' story hasn't died -- it's simply delayed by the weather gods," said Deepak Lalwani, India director at London's Astaire and Partners brokerage.
khanakhazana
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India seeks to reverse export decline in new trade policy
2009-08-27 16:30:00
India's new Foreign Trade Policy was unveiled Thursday with a mix of fiscal sops and procedural reforms in a bid to reverse 10 consecutive months of decline in merchandise exports and ensuring healthy growth of out-bound shipments.
The continuation of the popular duty-free export promotion scheme till end-2010, special sops for labour-intensive sectors and zero duty on capital goods import were some of the highlights of the policy unveiled by Commerce Minister Anand Sharma here.
'My immediate priority is to arrest and reverse the declining trend in exports,' he told the representatives of various export promotion councils and industry chambers at the Pragati Maidan trade and convention centre here.
The minister also set an export target of $200 billion for 2010-11 with a growth of 15 percent over the next two years, with an overall medium-term objective of 25 percent annual growth thereafter.
'By 2014, we expect to double India's exports of goods and services. The long-term policy objective for the government is to also double India's share in global trade by 2010,' he said.
'The three pillars which would support us to achieve the targets are improvement in export-related infrastructure, lowering of transaction costs and providing full refund of all indirect taxes and levies.'
India's merchandise exports had fallen short of the target set for 2008-09 and were valued at $168.7 billion, up merely 3.4 percent over $163.13 billion in the year before. Exports were also down 31.3 percent in the first quarter of this fiscal.
Nevertheless, Sharma said, India's share of global goods and services exports now stood at 1.53 percent, as opposed to 0.92 percent in 2003, while its share of global merchandise export was at 1.28 percent.
The minister said there were other positive developments as well in India's foreign trade scenario, especially at the special economic zones, which exported goods worth Rs.99,689 crore (nearly $20 billion) in 2008-09, to log a 50 percent growth over Rs.66,000 crore achieved in the previous year.
'This is a remarkable achievement in the current context. In the past five years, exports from special economic zones have grown 620 percent and have attracted foreign direct investment of $2.43 billion.'
Going to some specific measures in the new policy, Sharma said India will hold at least six 'Made in India' shows across the globe, even as diamond bourses will be set up to make the country an international hub for the trade.
'It is a welcome policy,' said A. Sakthivel, president of the Federation of Indian Export Organisations. 'The minister has given us free dollar credit, he has extended the interest subvention scheme, enhanced the focus product and focus market scheme. All this will help exporters.'
Industry lobbies such as the Associated Chambers of Commerce and Industry (Assocham) and the Federation of Indian Chambers of Commerce and Industry (FICCI) also welcomed the overall thrust of the policy and said it rightly focuses on demand creation for Indian products in new markets
2009-08-27 16:30:00
India's new Foreign Trade Policy was unveiled Thursday with a mix of fiscal sops and procedural reforms in a bid to reverse 10 consecutive months of decline in merchandise exports and ensuring healthy growth of out-bound shipments.
The continuation of the popular duty-free export promotion scheme till end-2010, special sops for labour-intensive sectors and zero duty on capital goods import were some of the highlights of the policy unveiled by Commerce Minister Anand Sharma here.
'My immediate priority is to arrest and reverse the declining trend in exports,' he told the representatives of various export promotion councils and industry chambers at the Pragati Maidan trade and convention centre here.
The minister also set an export target of $200 billion for 2010-11 with a growth of 15 percent over the next two years, with an overall medium-term objective of 25 percent annual growth thereafter.
'By 2014, we expect to double India's exports of goods and services. The long-term policy objective for the government is to also double India's share in global trade by 2010,' he said.
'The three pillars which would support us to achieve the targets are improvement in export-related infrastructure, lowering of transaction costs and providing full refund of all indirect taxes and levies.'
India's merchandise exports had fallen short of the target set for 2008-09 and were valued at $168.7 billion, up merely 3.4 percent over $163.13 billion in the year before. Exports were also down 31.3 percent in the first quarter of this fiscal.
Nevertheless, Sharma said, India's share of global goods and services exports now stood at 1.53 percent, as opposed to 0.92 percent in 2003, while its share of global merchandise export was at 1.28 percent.
The minister said there were other positive developments as well in India's foreign trade scenario, especially at the special economic zones, which exported goods worth Rs.99,689 crore (nearly $20 billion) in 2008-09, to log a 50 percent growth over Rs.66,000 crore achieved in the previous year.
'This is a remarkable achievement in the current context. In the past five years, exports from special economic zones have grown 620 percent and have attracted foreign direct investment of $2.43 billion.'
Going to some specific measures in the new policy, Sharma said India will hold at least six 'Made in India' shows across the globe, even as diamond bourses will be set up to make the country an international hub for the trade.
'It is a welcome policy,' said A. Sakthivel, president of the Federation of Indian Export Organisations. 'The minister has given us free dollar credit, he has extended the interest subvention scheme, enhanced the focus product and focus market scheme. All this will help exporters.'
Industry lobbies such as the Associated Chambers of Commerce and Industry (Assocham) and the Federation of Indian Chambers of Commerce and Industry (FICCI) also welcomed the overall thrust of the policy and said it rightly focuses on demand creation for Indian products in new markets
Ruag
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Volkswagen to hire 1,500 employees for India plant
Volkswagen Plans to Hire 1,500 Workers in India, PTI Reports - Bloomberg.com
Volkswagen Plans to Hire 1,500 Workers in India, PTI Reports - Bloomberg.com
blueoval79
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jarnee
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When was last you visited Bangalore?? After the new airport and road widening in North Bangalore..its way to better.
There is huge fund that Bangalore has got from center for Infrastructure.
Ruag
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Tech Mahindra wins $400 mn outsourcing deal from Etisalat
Tech Mahindra wins $400 mn outsourcing deal from Etisalat
Tech Mahindra wins $400 mn outsourcing deal from Etisalat
Tejas-MkII
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India pips China in car exports
India, whose auto market is 19% of Chinas, has the edge in exports. Suzuki Motor, Hyundai Motor, and Nissan Motor are making India a hub for overseas sales of minicars as incentives lift demand for smaller, fuel-efficient autos. Helped by cheaper labor and a surging local market, India this year overtook China in auto exports and is challenging Thailand and South Korea as an alternative production centre in Asia.
There is a worldwide shift toward fuel-efficient, compact cars, said Jayesh Shroff, who helps manage about $7 billion of assets including carmaker shares at SBI Asset Management in Mumbai. This offers a huge potential for India and it can emerge as a leader in the small car segment.
Maruti Suzukis exports more than doubled to 79,860 this year. It aims to ship 130,000 vehicles in the year to March, 86% more than last year, said chairman R C Bhargava.
Car exports clock 44% growth: Siam
Indias exports of minicars and hatchbacks gained 44% between January and July to 201,138, according to the Society of Indian Automobile Manufacturers. Total exports, including vans, sport-utility vehicles and trucks, rose 18% to 229,809. Cars are exported to over 100 countries, and dont include the US or Japan. Maruti Suzuki sold a monthly record 14,847 vehicles overseas in August.
Full control
In contrast, Chinas exports slumped 60% to 164,800 between January and July, according to government data. Vehicles produced in Thailand for export declined 43% to 263,768, according to the Thai Automotive Club.
South Korean exports dropped 31% to 1.12 million units, according to the Korea Automobile Manufacturers Association. Japan, the worlds largest automobile producer and exporter, shipped 1.77 million cars, trucks and buses. Of those, 135 were minicars and 439,849 were compacts.
Besides the attraction of serving a market where three of four cars bought are compacts, automakers will favor India to set up an export base as China requires companies to form local joint ventures and India doesnt, said Ashvin Chotai, London-based managing director of Intelligence Automotive Asia Ltd.
Natural place
It makes companies more comfortable to have an export strategy when they have full control, he said. They dont have to give up some parts of the profits to their partner.
Small cars will account for 95% of the 690,000 passenger vehicles India will export in 2015, according to Tim Armstrong, Paris-based director of IHS Global Insight. In 2016, India may share the top slot with Japan as the worlds biggest small car producer, building as many as 3 million units.
All of Indias expertise has been the small car, Armstrong said. So obviously its a natural place to turn to to set up export units. Toyota Motor and General Motors are also expanding Indian factories and plan to export compact vehicles. 
Enormous money
Nissan Motor, Japans thirdbiggest carmaker, will set up its first factory in India by May and use it to export entry-level cars to Europe. Spending on the plant is the most out of its global investments this year, said Colin Dodge, executive vice president.
Production in India will help Nissan save at least 5% of costs, he said. We needed a car that can make money in Europe, Dodge said in a June interview. BLOOMBERG
INDIA ROCKS
India, whose auto market is 19% of Chinas, has the edge in exports. Suzuki Motor, Hyundai Motor, and Nissan Motor are making India a hub for overseas sales of minicars as incentives lift demand for smaller, fuel-efficient autos. Helped by cheaper labor and a surging local market, India this year overtook China in auto exports and is challenging Thailand and South Korea as an alternative production centre in Asia.
There is a worldwide shift toward fuel-efficient, compact cars, said Jayesh Shroff, who helps manage about $7 billion of assets including carmaker shares at SBI Asset Management in Mumbai. This offers a huge potential for India and it can emerge as a leader in the small car segment.
Maruti Suzukis exports more than doubled to 79,860 this year. It aims to ship 130,000 vehicles in the year to March, 86% more than last year, said chairman R C Bhargava.
Car exports clock 44% growth: Siam
Indias exports of minicars and hatchbacks gained 44% between January and July to 201,138, according to the Society of Indian Automobile Manufacturers. Total exports, including vans, sport-utility vehicles and trucks, rose 18% to 229,809. Cars are exported to over 100 countries, and dont include the US or Japan. Maruti Suzuki sold a monthly record 14,847 vehicles overseas in August.
Full control
In contrast, Chinas exports slumped 60% to 164,800 between January and July, according to government data. Vehicles produced in Thailand for export declined 43% to 263,768, according to the Thai Automotive Club.
South Korean exports dropped 31% to 1.12 million units, according to the Korea Automobile Manufacturers Association. Japan, the worlds largest automobile producer and exporter, shipped 1.77 million cars, trucks and buses. Of those, 135 were minicars and 439,849 were compacts.
Besides the attraction of serving a market where three of four cars bought are compacts, automakers will favor India to set up an export base as China requires companies to form local joint ventures and India doesnt, said Ashvin Chotai, London-based managing director of Intelligence Automotive Asia Ltd.
Natural place
It makes companies more comfortable to have an export strategy when they have full control, he said. They dont have to give up some parts of the profits to their partner.
Small cars will account for 95% of the 690,000 passenger vehicles India will export in 2015, according to Tim Armstrong, Paris-based director of IHS Global Insight. In 2016, India may share the top slot with Japan as the worlds biggest small car producer, building as many as 3 million units.
All of Indias expertise has been the small car, Armstrong said. So obviously its a natural place to turn to to set up export units. Toyota Motor and General Motors are also expanding Indian factories and plan to export compact vehicles. Enormous money
Nissan Motor, Japans thirdbiggest carmaker, will set up its first factory in India by May and use it to export entry-level cars to Europe. Spending on the plant is the most out of its global investments this year, said Colin Dodge, executive vice president.
Production in India will help Nissan save at least 5% of costs, he said. We needed a car that can make money in Europe, Dodge said in a June interview. BLOOMBERG
INDIA ROCKS
RPK
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Tajikistan invites India to invest in hydro power :: Samay Live
Dushanbe, Sept 8 (PTI) Tajikistan has invited India to explore the huge hydro power potential in the country as part of efforts to intensify bilateral economic cooperation and explore new areas of partnership between the two sides.
Addressing businessmen at the inauguration of India-Tajikistan Business Forum in the presence of President Pratibha Patil last night here, Tajikistan President Emomali Rahmon said his country was also ready to cooperate with India in the field of mining, pharmaceuticals, agriculture product processing and other new areas.
"Our bilateral cooperation is increasing over last years, however, we still have tremendous opportunities and unexhausted reserves of fruitful cooperation," Rahmon told the captains of industry from India.
The Tajik President said his country was ready and open to invite India and its businessmen to explore possibilities of investing in hydro power projects.
He said his country along with Afghanistan and Pakistan would be very happy to support such projects.
Rahmon said his country was also interested in Indian companies participation in the proposed silver extraction project for which an international bid is to be launched.
Sharing the views of her Tajik counterpart, Patil said investors from India and Tajikistan can consider opportunities for bilateral investment in areas like agriculture, mining, transport, infrastructure, hydropower as well as health and education. .
Dushanbe, Sept 8 (PTI) Tajikistan has invited India to explore the huge hydro power potential in the country as part of efforts to intensify bilateral economic cooperation and explore new areas of partnership between the two sides.
Addressing businessmen at the inauguration of India-Tajikistan Business Forum in the presence of President Pratibha Patil last night here, Tajikistan President Emomali Rahmon said his country was also ready to cooperate with India in the field of mining, pharmaceuticals, agriculture product processing and other new areas.
"Our bilateral cooperation is increasing over last years, however, we still have tremendous opportunities and unexhausted reserves of fruitful cooperation," Rahmon told the captains of industry from India.
The Tajik President said his country was ready and open to invite India and its businessmen to explore possibilities of investing in hydro power projects.
He said his country along with Afghanistan and Pakistan would be very happy to support such projects.
Rahmon said his country was also interested in Indian companies participation in the proposed silver extraction project for which an international bid is to be launched.
Sharing the views of her Tajik counterpart, Patil said investors from India and Tajikistan can consider opportunities for bilateral investment in areas like agriculture, mining, transport, infrastructure, hydropower as well as health and education. .
blueoval79
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India becomes more competitive, but Switzerland best in world
Vibrant financial markets and a sound banking sector has helped Indian economy move up a notch to 49th place on the global competitive scale, while Switzerland has toppled the US as the top-ranked nation, the World Economic Forum (WEF) said today.
The US has slipped to the second place and is followed by Singapore, Sweden and Denmark in the top five, according to the annual ranking of the world's most competitive economies.
Among the 133 countries featuring in the list, three nations in the BRIC grouping -- India, China and Brazil -- have moved up the competitiveness ladder while Russia has witnessed a sharp drop.
Both India and China have moved up one place to 49th and 29th positions, respectively, in the latest ranking. Last year, India was at the 50th spot while China stood at 30th place. Brazil has improved its rank by eight places to 56 this year.
However, Russia has slumped to the 63rd place from 51 in the Global Competitiveness Index 20092010.
"India's competitive performance continues to exhibit a rather reversed development pattern. It precedes many advanced economies in terms of business sophistication and innovation capacity. India also boasts bustling financial markets and a sound banking sector, supported by well-functioning institutions," WEF said.
In terms of well-functioning institutions, India is at the 54th place while at 16th and 25th spots in terms of bustling financial markets and a sound banking sector supported by a vast domestic market.
On the other hand, the report noted that India under performs in some of the basic determinants of competitiveness, in particular infrastructure, health and primary education.
"In addition, penetration rates for mobile telephony (116th), the Internet (104th), and personal computers (96th) remain among the lowest in the world, while inefficiencies in the labour market (83rd) prevent an optimal allocation of human capital.
"Improvement in these areas would place India on a stronger growth trajectory going into the future," WEF said.
The ranking is based on twelve factors of competitiveness, including institutions, infrastructure, macroeconomic stability, health and primary education, higher education and training.
Other criteria taken into consideration are goods market efficiency, labour market efficiency, financial market sophistication, technological readiness, market size, business sophistication and innovation.
Hsbc Unveils Global Credit Cards
Vibrant financial markets and a sound banking sector has helped Indian economy move up a notch to 49th place on the global competitive scale, while Switzerland has toppled the US as the top-ranked nation, the World Economic Forum (WEF) said today.
The US has slipped to the second place and is followed by Singapore, Sweden and Denmark in the top five, according to the annual ranking of the world's most competitive economies.
Among the 133 countries featuring in the list, three nations in the BRIC grouping -- India, China and Brazil -- have moved up the competitiveness ladder while Russia has witnessed a sharp drop.
Both India and China have moved up one place to 49th and 29th positions, respectively, in the latest ranking. Last year, India was at the 50th spot while China stood at 30th place. Brazil has improved its rank by eight places to 56 this year.
However, Russia has slumped to the 63rd place from 51 in the Global Competitiveness Index 20092010.
"India's competitive performance continues to exhibit a rather reversed development pattern. It precedes many advanced economies in terms of business sophistication and innovation capacity. India also boasts bustling financial markets and a sound banking sector, supported by well-functioning institutions," WEF said.
In terms of well-functioning institutions, India is at the 54th place while at 16th and 25th spots in terms of bustling financial markets and a sound banking sector supported by a vast domestic market.
On the other hand, the report noted that India under performs in some of the basic determinants of competitiveness, in particular infrastructure, health and primary education.
"In addition, penetration rates for mobile telephony (116th), the Internet (104th), and personal computers (96th) remain among the lowest in the world, while inefficiencies in the labour market (83rd) prevent an optimal allocation of human capital.
"Improvement in these areas would place India on a stronger growth trajectory going into the future," WEF said.
The ranking is based on twelve factors of competitiveness, including institutions, infrastructure, macroeconomic stability, health and primary education, higher education and training.
Other criteria taken into consideration are goods market efficiency, labour market efficiency, financial market sophistication, technological readiness, market size, business sophistication and innovation.
Hsbc Unveils Global Credit Cards
Gabbar
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Indian firm in mega deal to buy Kuwait-based telecom company
To strike the second biggest deal ever struck by an Indian firm, telecommunication technology outfit Vavasi and Malaysia-based Al Bukhary has formed a consortium to take over the $7.5-billion (Rs 36,000 crore) Kuwait-based telecom service provider, Zain.
The consortium is signing a deal with the Kharafi family of Kuwait for acquiring a 46 per cent stake in Zain.
If one goes by market capitalisation the total value of the shares of a company a 46 per cent stake in Zain would come to about $9.66 billion (Rs 64,368 crore).
The Rs 36,900-crore ($7.80 billion) Bharti Telecom is currently in a $23-billion (Rs 110,400 crore) two-way merger and acquisition negotiation with the $12.3-billion (Rs 55,000 crore) MTN of South Africa.
The Kharafi family, according to a deal that will be signed on Tuesday night, will sell off its entire 32 per cent holding in Zain to the consortium and mop up 14 per cent more from the market.
An industry source, who refused to be identified, said the Rs 34,000-crore (Rs 340 billion) Bharat Sanchar Nigam Ltd and Rs 5,300-crore (Rs 530 billion) Mahanagar Telephone Nigam Ltd, both public sector telecom undertakings, were exploring the possibility of joining the consortium.
Although the chiefs of both the PSUs were not available for comments, B.K. Syngal, former chief of Videsh Sanchar Nigam Ltd, a PSU that has become part of the Tata group, said, "Acquisition of Zain would give tremendous advantage to both BSNL and MTNL. But they will have to improve their processes to meet requirements of merger and acquisition."
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