 |
| BIAL's CEO
Albert Brunner: Light at the end of the tunnel |
It has been 15
years in the making. And with the Centre finally, last fortnight,
signing the concession agreement granting requisite approvals for
setting up India's first true greenfield airport, Bangaloreans are
at last beginning to believe the international airport can take
concrete shape, after all. At Khanija Bhavan (Mineral House), where
the offices of Albert Brunner, Chief Executive Officer of Bangalore
International Airport Ltd (BIAL), there's an air of optimism, and
Brunner is hopeful that the airport will be ready three years from
today.
Over the years the airport project got bogged
down by one delay after the other. In spite of having two central
civil aviation ministers from Karnataka during this period-C.M.
Ibrahim during H.D. Deve Gowda's prime ministership and Ananth Kumar
in the NDA-the project just couldn't take off. Both failed due to
a number of reasons.
Controversy has been no stranger to the airport
blueprint, which took the shape of a private initiative in 1994.
The project duly slipped into rough weather when the two partners,
the Tatas and Singapore Airlines, walked out citing governmental
delays. The Tatas had already spent close to Rs 5 crore on initial
surveys by then.
That's all history today. The Centre's clearance, following a report
from a team of the Director General of Civil Aviation (DGCA), is
just the shot in the arm Brunner needed. The DGCA report is subject
to the Karnataka government's approval for using the land. The state
has to give a land-user's certificate to the company, which incidentally
had applied for it nearly one and half years ago. P.G.R. Sindhia,
Karnataka Industries and Infrastructure Minister, avers that "all
major problem are out of the way. The only big agreement that is
pending with the air traffic control to coordinate aircraft between
HAL (the existing Bangalore airport), Jakkur (flying club) and the
new project". Sindhia also declares the government is ready
to hand over the 4,300 acres of land acquired for the purpose to
BIAL.
Civil aviation ministry officials said the
government has reworked the long-pending concession agreement with
BIAL, paving the way for private investors to start work on arranging
funds and beginning construction. In what is seen as Minister of
State for Civil Aviation Praful Patel's first gift to India's aviation
capital Bangalore, the civil aviation ministry has also decided
to discontinue all scheduled and civil flights from the existing
HAL airport once the new greenfield airport is operational.
If there's anybody who needs to be convinced
about the need for an international airport at Bangalore, the air
passenger traffic figures would surely help do the needful: 30 lakh
as of 2003, which will double by 2007. International airlines, like
Lufthansa, Malaysian Airlines, Singapore Airlines and Sri Lankan
Airlines, have already commenced operations, and more should follow
soon.
Officials say the concession agreement (CA)-almost
two and half years in the making-was redrafted after consultation
with the law ministry. BIAL and the Karnataka government had sent
back the ''final draft'' cleared by the earlier government, stating
that 40 unacceptable clauses, including ambiguity over closure of
the existing HAL airport, had to be changed. The ca will be followed
by other documents-financial closure, state support, land lease
deal and the air traffic management agreement-and officials expect
them to be in place by August 2004.
The delays have already lead to a cost escalation
of about Rs 4 crore a month. But if the market is the best barometer
of indications to come, it seems happy days are here again. Reason:
Land prices along the road to Devanahalli have shot up thanks to
market-friendly realtors who have done more to publicise the cause
of the airport than the governments, both the state and the Centre.
Meanwhile Albert Brunner and Bangaloreans are keeping their fingers
crossed.
-Venkatesha Babu
Mother
Of All Funds
Three quarters of the portfolio of Kotak MF's
new offering will be made of non-Kotak fund schemes.
 |
| Kotak MF's
Bagga : It's a bag of funds, really |
If mutual funds
have to attract more retail investors, one way of doing it is via
innovation. The Kotak Equity Fund of Funds Scheme has done exactly
that, as it will not restrict its investment to just Kotak mf schemes.
Up to 75 per cent of the portfolio will be invested in diversified
equity schemes, across fund houses and fund manager styles. "What
we are launching is a fund of funds and not a scheme of schemes,"
says Ajay Bagga, CEO, Kotak Mutual Fund.
Every quarter the portfolio will be reviewed
and rebalanced based on the recommendations of an external research
agency. But the offer document places some major restrictions on
possible investments: First, the scheme can invest only in big fund
houses with a minimum of Rs 5,000 crore of assets under its management-as
per industry data only 12 Indian fund houses can boast of this.
Second, the fund houses should have a reasonable equity exposure
of at least Rs 500 crore. Third, the schemes selected should have
a track record of at least one year and a minimum Rs 50 crore in
assets. To ensure a diversified portfolio, only up to 25 per cent
of the portfolio will be in one scheme. IPO ends on July 19.
-Narendra Nathan
Vizag
Ho!
Move over Hyderabad, Vizag's getting hotter
by the day.
 |
| HSBC's Brooker: Zeroing in on Vizag |
If
scores of pharmaceutical manufacturers and it-enabled service providers
are making a beeline for Vishakhapatnam (or Vizag), it's simply
because it's the next best alternative in Andhra Pradesh to a packed
out Hyderabad. Pharma majors, including Aurobindo Pharma, Dr. Reddy's
and Divi's labs have already set up a second base in and near Vizag.
And some 40 units have made initial payments for taking space in
the town's proposed pharma city, spread over 2,000 acres, and expected
to be ready by mid-2005. Alongside, it/it-enabled service providers,
led by HSBC, are also zeroing on Vizag.
Since the past five years, in keeping with
the needs to control pollution, no new licences have been issued
for expansion of facilities in the landlocked state capital. "Vizag
has a sea port, an airport and universities," points out Venkat
Jasti, President, Bulk Drugs Manufacturers Association. "For
pharma units, it is necessity that's taking them to Vizag."
What's more, Vizag has always been an excellent talent sourcing
base for the drugs industry, courtesy the Andhra University's strong
pharma department and the Andhra Medical College.
The wooing of ITEs/BPO firms is also happening
in right earnest. At his recent (and first) meeting with the heads
of it units in the state, Chief Minister Y.S. Rajashekhara Reddy,
was liberal in his praise for HSBC, which hopes to have 1,500 people
by the year-end for its transaction processing and BPO facilities
in Vizag. ''I would like to congratulate HSBC for being a pioneer
and deciding to locate their BPO in Vishakhapatnam after comparing
locations internationally.''
To encourage more players to duplicate the
HSBC model, the chief minister told IT/ITEs players that the state
was now considering special incentives to companies setting up operations
in tier-II cities in the state. According to Colonel M. Vijay Kumar,
Director, Software Technology Parks of India, Hyderabad: ''it activity
witnessed a pick-up in Vizag post-2000.'' The infrastructure costs
are at least half that of Hyderabad (though the costs of key components
like power and telecom remain the same). Vizag now has a mini-Hi-Tec
City (spread over 2 acres where units can locate their own facility;
the first to do that has been HSBC). The grapevine has it that other
majors like GE and Adaptec are also looking at the region. The more
the merrier.
-E. Kumar Sharma
Traders
Thumped
 |
| BSE: Budget
blues for the brokers |
Why
exactly were punters unhappy with Chidambaram's transaction tax?
For starters the levy of 15 basis points was
well above the market expectations. As the current brokerage cost
for most day-traders and arbitrageurs is in the range of 5-10 basis
points, the proposed tax trebles costs. Result? Volumes will dry
up, as day trading accounts for more than 80 per cent of volumes.
That's bad news for all investors, short or long term.
The 0.15 per cent tax is devastating for bonds
as gains are very small (usually 10-20 basis points). "A 50
basis point move is big here", explains Rajiv Anand, Head (Investments),
at Standard Chartered Mutual Fund. Further, most participants in
this segment don't come under capital gains tax-mutual funds are
exempt from tax, whilst banks account gains under business income-so
Chidambaram's tinkering with those levies means little to them.
-Narendra Nathan
|
