Week in review

Updated: Oct 20 2002, 05:30am hrs
India To Pull Back Troops, Pakistan RespondsIn a major step to de-escalate the Indo-Pak tensions, India announced late on Wednesday it was pulling back its troops from forward positions along the international border between the two countries, but there would be no change in the deployment along the line of control in Jammu and Kashmir. The decision was taken after a 90 minute meeting of the Cabinet Committee on Security (CCS), shortly after the National Security Advisory Board (NSAB), also chaired by Prime Minister Atal Behari Vajpayee, had recommended the step.

In response to Indias announcement, Pakistan also said on Thursday that it would withdraw troops from the border. However, later Pakistan clarified that its army along the Line of Control in Jammu and Kashmir would remain in position.

At the LoC, the Indians had huge number of troops in Kashmir for the last 12 years and even before. That is one thing they have not changed in the last 12 years. Obviously there is a compulsion here. If India keeps its troops there, Pakistan will be forced to keep its troops, defence spokesman Rashid Qureshi told state television.

An estimated 300,000 to 400,000 Indian troops are expected to be redeployed to peace time locations after 10 months of eyeball-to-eyeball confrontation with the Pakistani troops in the aftermath of the terrorist attack on Parliament House in New Delhi on December 13.

While announcing Indias decision, defence minister George Fernandes said the armed forces would take their time to implement the process of withdrawal. Ruling out any similar initiative on the diplomatic front, Mr Fernandes said there was no question of resumption of dialogue with Pakistan till cross-border terrorism ends.

Presidents Rule Imposed In The State
In a sudden twist to the political crisis that has gripped Jammu and Kashmir since the recent elections resulted in a hung assembly, the state was placed under Presidents rule late on Thursday. This was after major political parties failed to come together to form a new government.

The refusal of caretaker chief minister Farooq Abdullah to continue in office despite a plea by Prime Minister Atal Behari Vajpayee prompted the sudden decision to bring the state under the Presidents rule.

There has been sharp reaction to the imposition of central rule in the state. The four-member Jammu and Kashmir National Panthers Party (JKNPP) termed it as a massacre of peoples mandate. Reacting to the governors decision, JKNPP president Bhim singh said while Mr Vajpayee had himself initiated the process of restoration of democracy, those in North Block had prevented the formation of government.

Hussain rules Out Selling Of AI, IA
Union civil aviation minister Syed Shahnawaz Hussain on Wednesday scotched speculation on disinvestment or privatisation of Air India and Indian Airlines in the near future.

There is no chance of disinvestment or privatisation of the two leading airlines in the near future, Mr Hussain told reporters on the completion of his one year tenure in the civil aviation ministry.

He said his ministry had already decided to privatise airports in the four metros and upgrade them to match the standard of model airports elsewhere in the world. Besides ten more airports in the country had been identified for making them model ones.

Mr Hussain said his ministry had prepared a draft for the new civil aviation policy and it was being processed for approval of the Union Cabinet.

He said the Airport Authority of India had acquired land from Bihar government and the Railways for the expansion of Patna airport and work would start soon.

Positive Inflows At Rs 227 Crore
Unit Trust of Indias net inflow has turned positive at Rs 277 crore since beginning of financial year in July 2002 even as it is planning to launch a variable income scheme early next month.

Gross inflows in various schemes have grown especially in the bond fund and government securities funds to about Rs 2,200 crore in little over three months while in 2001-02 collections totalled Rs 2,600 crore, UTI chairman M Damodaran said on Wednesday.

The countrys largest fund manager witnessed a net outflow Rs 10,300 crore in the last fiscal ended June 30, 2002, Mr Damodaran said. Similarly, UTI witnessed a net outflow in July and August 2002, when its Monthly Income Scheme 1997 (III) matured, involving an outgo of about Rs 800 crore, he said. The open-ended regular income scheme, which closed on October 12, has raised Rs 200 crore and UTI would come out with a variable income scheme next month for which Sebi has already granted approval, Mr Damodaran said.

Sebi To Look Into Telco Write-Off
The Securities and Exchange Board of India (Sebi) will be looking into allegations of insider trading in Telcos move to write off Rs 1,178.91 crore to a securities premium account. Telcos move was immediately preceded by a rights issue, which made no mention to shareholders of the possibility of such a write-off.

According to sources in Sebi, the regulator will look into these allegations, which were highlighted by a shareholders letter to its chairman G N Bajpai, and may begin investigations soon.

According to the letter (and the companys annual report), shareholding in Telco by other Tata group companies increased to 10,29,96,528 shares on March 31, 2002, from 6,48,49,896 as on March 31, 2001. The Tata companies acquired more than 3,81,00,000 shares at Rs 65 per share by subscribing to the companys November 2001 rights issue, the letter stated.

The letter further stated that, in the offer letter dated September 22, 2001, filed with Sebi and also distributed to all shareholders, there was no mention of Telcos plan to write off Rs 1,178.91 crore to the securities premium account, immediately after the closure/completion of the issue.

According to Telco executive director (finance), Parvin Kadle: It is an absolutely incorrect statement made by the shareholder in the letter to Sebi. The write-off issue was deliberated by Telcos finance committee through a series of meetings between December and February, and the process involved detailed discussions over the issue, before it was approved by the board. The matter was taken to the audit committee before the proposal was presented to the board for approval.

Thus, Telco has denied the allegations stating that it was not a sudden decision on the part of the company to approve the write-off, as is established by the series of meetings that were convened to discuss the issue well before its approval at the board.