After ducking the CBI for four days, former Gujarat home minister Amit Shah surfaced on Sunday before driving to the state capital and surrendering before the investigative agency. He was arrested immediately and produced before additional chief metropolitan magistrate A Y Dave, who remanded him to judicial custody for 13 days.
The 46-year-old Shah, who was on Saturday forced to resign from the Gujarat BJP government following the filing of a chargesheet against him in the Sohrabuddin Shaikh murder case, was left with no option, but to surrender before the investigative after his anticipatory bail plea was rejected by the special CBI court in Gandhinagar on Friday evening.
The CBI, surprisingly, did not press for custody of Shah, who has been charged with murder, extortion, kidnapping and five other sections under IPC for the killing of Sohrabuddin and his wife Kausar Bi in 2005.
CVC widens tele probe, dual licences under lens
The Central Vigilance Commission (CVC) has opened a wide-ranging investigation into all key decisions taken by telecom minister A Raja, including a controversial move to allow two cellphone companies to operate on dual technologies, steadily amplifying the scope of a probe that was directed at licence allotments to new players in 2008.
Mr Raja has been criticised by Opposition parties for allegedly causing an estimated loss of over 60,000 crore to the exchequer by awarding 2G licences to companies at throwaway prices. The telecom tribunal and the Delhi High Court had, however, cleared his ministry of mischief while awarding dual licences.
Besides the CVC, the Central Bureau of Investigation (CVC), Comptroller and Auditor General (CAG) and the parliamentary standing committee are all sniffing around the decisions by Mr Raja, who perhaps has the ignominy of facing the most number of investigations against a minister.
What CVC is probing
Allotment of mobile phone licences to new entrants in 2008
Move to allot dual licences to RCOM and Tata Teleservices
Allegations that DoT had allowed CDMA operators to make the requisite payments for launching GSM services even before the government unveiled the dual technology policy
Why DoT did not take back non-operational licences and spectrum from Idea Cellular after it bought the mobile operations of Spice Communications
Slow rollout of services by new entrants such as Etisalat DB, Videocon, Loop Mobile, S Tel and Uninor that were awarded licences in 2008 CVC probe comes after PMO sought details of telcos’ rollouts
Rollout obligations: New entrants must cover at least 10% of each district headquarters in every circle in the first year, and complete the rollout in three years.
Finance & Economy
All eyes on RBI on monetary tightening
India's central bank is widely expected to raise policy rates by at least a quarter per cent, or 25 basis points, this week, to cool double-digit inflation that threatens to drag down growth.
The mavens are betting on the Reserve Bank of India, or RBI, increasing the repurchase, or repo rate, — the rate at which the central bank lends to banks — by 25 basis points and the reverse repurchase rate — the rate that RBI pays to banks which park their excess funds with it — also by 25 basis points in its quarterly monetary review on Tuesday. The RBI, which has raised rates three times this year in what it terms as baby steps, is under pressure to maintain the pace of monetary tightening, or to push up borrowing costs, as the wholesale price index has stayed above 10% for five months now.
Despite the rise in prices, few expect an increase in the cash reserve ratio, or CRR, — the portion of deposits that banks park with RBI — at this stage. This is partly because a year-on-year money supply growth has slowed down considerably to 15.3%.
Also, liquidity is already tight. The RBI is currently lending on an average well above 60,000 crore to banks, given the shortage of funds in the market. Bankers feel that any move to reduce liquidity would be calibrated with government spending and the state of capital inflows.
Depositary receipts to count as public holding?
The Securities and Exchange Board of India (Sebi) and finance ministry are likely to include depository receipts, or DRs, while calculating public shareholding, according to grapevine.
Early last month, the government changed the rules on public listing, making it mandatory for all listed companies to have a minimum public shareholding of 25% compared with 10% earlier.
Depository receipts are instruments issued by companies to investors abroad with domestic equity shares as the underlying. The most common form of DRs are American depositary receipts (ADRs), which are issued to investors in the US and listed on the bourses there, as well as global depository receipts, which are issued to European investors and listed on the Luxembourg Stock Exchange
If DRs are indeed eventually classified as part of public holding, the owners of companies such as Wipro will find it little easier to meet the 25% mark.
There are only around 65 companies, with more than 2,000-crore market cap, where the promoter holding is more than 75%.
Industry experts say one reason why the notification did not include DRs as part of public float could be because they do not have voting rights, even though the underlying equity shares do. These shares are held by a depository, which then issues the corresponding receipts or GDRs/ADRs to investors looking to buy such instruments. Consequently, it is the depository that has the voting rights. Whether the holders of the DRs can vote depends on the agreement between the company and the depository. During the initial years when GDRs and ADRs came into vogue, the agreement mandated depositories to vote on behalf of the management. But later, the agreements were changed allowing the holders of DRs to instruct the depository to vote on their behalf.
Mobile banking to tackle financial inclusion
The UPA government may allow cellular operators and other corporate entities to offer financial services on mobile phones as it looks to speed up its efforts to ensure that the weaker sections of the society have access to such facilities at affordable costs.
A multi-ministerial government panel chaired by the cabinet secretariat has asked the Reserve Bank of India to look into the possibility. If RBI agrees to this proposal, services such as Nokia Money can be launched in India bypassing banks, and entities such as the Bharti Airtel-Western Union joint venture can offer mobile money transfers without utilising bank networks.
Currently, banks and cellular firms /corporate entities that have tie-ups with them can offer basic financial services on mobile phones using bank networks. Earlier this month, RBI had informed the multi-ministerial government panel that it would take a final decision on this issue by August-end.
India, the world’s fastest-growing mobile market, adds 15 to 20 million new cellular users every month. The country, with over 1.2 billion population, had over 635 million mobile connections in June. The number of individuals having a bank account is much smaller.
The case in favour of bifurcation of the posts of Chairman and Managing Director in corporates
It will lead to a major overhaul of the board structure of most listed companies in India. More importantly, it would bring in greater accountability.
It will also mean a clear demarcation of the roles and responsibilities of board members.
Independent directors on the board are likely to discharge their intended function better, as well, when the chairman is separate from the CEO.
What is the next big thing on the Internet?
Take a look at this story. It is about a company called Zynga that makes online games. It gives us a peek into the future. Very interesting.
US growth hits slow patch
The US economy expanded at a slower pace in the second quarter as consumer spending cooled and the trade deficit swelled. Gross domestic product rose at a 2.5% annual pace after increasing at a 2.7% rate in the first three months of the year. Other data may show gains in business investment are taking up some of the slack, while housing is mired in a slump.
Less growth heading into the second half of the year means employers will hesitate to take on staff and will keep a lid on prices to spur sales.
Consumer spending, which accounts for about 70% of the economy, increased at a 2.4% annual rate last quarter after growing at a 3% pace the previous three months.