Today's Hot Stories - March 18, 2014
10 Headlines for Today(1) Azad likely to contest from Udhampur-Doda
(2) Mamata should be more critical of Modi: Kolkata Imam
(3) MH370: No explosion or crash detected
(4) Reliance Cement's land lease runs into trouble
(5) Maruti stock up 10% on plan to seek approval for Gujarat plant
(6) Vodafone agrees to buy Spanish network
(7) Malinga’s four-for hands Sri Lanka 5-run win over India
(8) Ireland shocks Zimbabwe in World T20
(9) Anand keeps lead after draw
(10) Over 10 mn people to join Ilayaraaja’s fan club
5 Stories for Today
(1) Classified 1962 war report revealed for first time
(2) Italian court bars India from encashing bank guarantees
(3) Hotel chains struggle with low bookings
(4) Unease grows among US doctors over quality of Indian medicines
(5) FDI by domestic companies recovers in FY14, around $30 bn so far
(1) Classified 1962 war report revealed for first time
For the first time, a large section of the still classified Henderson Brooks Report, which details a comprehensive operational review of India’s military debacle in 1962, has been made public.
A more-than-100-page section of the first volume of the report, which includes an exhaustive operational review of the India-China war over both western and eastern sectors, has been published by Australian journalist Neville Maxwell on his website.
The now retired Mr. Maxwell was a former correspondent of The Times of London, who reported on the war from New Delhi. He authored in 1970 ‘India’s China War’ — a path-breaking, yet controversial, account of the conflict which angered the Indian establishment by drawing upon classified information to highlight the flawed decision-making that led to defeat at the hands of the Chinese.
Explaining his decision to release, for the first time, four chapters of the still classified report, Mr. Maxwell said he believed he was “complicit in a continuing cover-up” by keeping the report to himself.
“The reasons for the long-term withholding of the report must be political, indeed probably partisan, perhaps even familial,” he wrote in an explanatory note on his website.
The report indicts the highest levels of the government — from the then Prime Minister Jawaharlal Nehru's own office and the Defence Ministry — particularly for its Forward Policy, which was enforced, the report reveals, despite considerable concerns and objections from on-the-ground military commands that lacked resources.
It underlines the deep disconnect between Delhi and Army commands on assessing how China would react to the Forward Policy.
Source: Hindustan Times
(2) Italian court bars India from encashing bank guarantees
An Italian court has barred India from encashing bank guarantees worth over Rs. 2,360 crore of AgustaWestland as part of the penalties imposed on it after scrapping of the Rs. 3,600 crore VVIP chopper deal.
India has decided to file an appeal against the decision of the Italian court, a Defence Ministry spokesperson said.
India has already encashed bank guarantees of around Rs. 240 crore deposited in banks in India but it is yet to recover the bank guarantees deposited in banks of Italy.
An Italian court in Milan on Monday accepted a plea by AgustaWestland’s parent company Finmecannica to stop India from encashing over Rs. 2,360 crore. “With this measure, the Court granted the requests made by the companies of the Finmeccanica Group, recognising the manifestly abusive enforcement of the guarantees made by the Indian Defense Ministry, given the vagueness of the complaints made in relation to alleged breaches of contract,” Finmeccanica said in a statement.
“The Milan court has confirmed the ruling made last January, prohibiting...the payment of collateral of more than 278 million euros deposited in relation to the contract,” it said.
India terminated the Rs. 3,600 crore deal on January 1 for procuring 12 VVIP AW-101 choppers for the IAF on allegations of payment of kickbacks and involvement of middlemen in the acquisition process by the Anglo-Italian firm.
The Italian court had put a stay on India’s effort to encash the bank guarantees in an earlier hearing on January 8.
After the cancellation of the contract, India had also decided to go in for arbitration with the Anglo-Italian firm and the two sides have nominated their members in this regard.
The Anglo-Italian firm has already supplied three choppers to India and the delivery of the remaining nine was put on hold after Defence Minister A.K. Antony ordered a CBI probe into the corruption allegations after the arrest of Finmecannica’s former CEO Guiseppe Orsi and AgustaWestland’s former head Bruno Spagnolini in Italy in connection with the probe going on there.
Source: The Hindu
(3) Hotel chains struggle with low bookings
The Indian Hotels Company last week announced an additional non-cash provision of Rs. 500 crore on its books citing macroeconomic depression and the adverse effect it had on some of its investments. The company, which operates the Taj Group of hotels, is however not alone in signalling tough times.
Several luxury hotel chains including Hotel Leelaventure and ITC’s hotels division have seen sluggish growth over the first nine months (April-December) of 2013-14 as the economic slowdown coupled with a room supply-demand mismatch in several cities put pressure on occupancies and room rentals.
According to online portal hotels.com, room rates in five-stars across India fell in 2013, with rates in Delhi declining 12%, while those in Mumbai down 7%.
During April-December 2014, average room rates fell in most major cities, citing data by STR Global, a company that benchmarks hotel data. Supply of luxury rooms outstripped demand in markets such as Chennai, where room supply rose over 10%, while demand was up just 0.3% and in Delhi-NCR, where supply rose 6.6% against a 4.8% rise in demand over a year ago.
Hotel Leelaventure is learnt to be in talks to sell a couple of properties to pare its debt, which stands over Rs. 4,000 crore. It has been in talks with investors and lenders and has been linked with PE investor Kohlberg Kravis Roberts & Co for a possible loan.
"The board looked at indicative term sheets for a bridge loan. But the terms of the loan didn’t meet the company’s requirements and CMD Vivek Nair has been authorised to negotiate the terms of the bridge loan," a company spokesperson told HT.
And given the overall slowdown and political uncertainties this year, things are unlikely to pick-up soon, analysts said. "The slowdown is not expected to lift in near-term," said Neha Majithia of Microsec Capital.
Analysts said hotel chains are looking at management contracts instead of greenfield expansion.
Source: The Economic Times
(4) Unease grows among US doctors over quality of Indian medicines
Some US doctors are becoming concerned about the quality of generic drugs supplied by Indian manufacturers following a flurry of recalls and import bans by the Food and Drug Administration.
India supplies about 40 percent of generic and over-the-counter drugs used in the United States, making it the second-biggest supplier after Canada.
In recent months, the FDA, citing quality control problems ranging from data manipulation to sanitation, has banned the importation of products from Ranbaxy Laboratories Ltd , Wockhardt Ltd and, most recently, Sun Pharmaceutical Industries Ltd .
"I'm just beginning to realize the gravity of the problem," said Dr Steven Nissen, head of cardiology at the Cleveland Clinic. "It's terrible and it is starting to get a lot of traction among physicians."
Indian drugmakers are by no means the only companies to recall products or be warned by the FDA about manufacturing problems. For instance, quality control failures at Johnson & Johnson forced the company to recall dozens of products over the past five years, ranging from artificial hips to children's Tylenol.
And last year, Germany's Boehringer Ingelheim said it would shut down its US contract manufacturing unit, Ben Venue Laboratories, after it was cited for repeated manufacturing violations that led to shortages of the cancer drug Doxil.
India's drugmakers, a $14 billion industry, reject any criticism that their products are inferior to drugs made in other countries.
"We have heard doctors making generalized statements, without being specific on any product or company," said D G Shah, Secretary General of the Indian Pharmaceutical Alliance, a trade group representing large Indian drugmakers. "This is a deliberate and serious campaign to malign the Indian generic industry."
If US doctors come across a medicine that does not meet quality standards, they should report it to regulators, he said. "Doctors are not in a position to judge whether manufacturing processes are correct or not. That is the US FDA's job."
Generic drugs account for nearly 85 percent of medicines prescribed in the United States and the government is relying on them to help rein in healthcare costs.
"We are losing control over what people are swallowing," said Dr Harry Lever, a cardiologist at the Cleveland Clinic who is trying raise awareness of the matter among US lawmakers. "Now, when a patient comes in who is not doing well, the first thing I do is look at their drugs and find out who makes it."
Increasingly, Lever said, he is recommending patients seek out generic drugs from specific manufacturers outside India.
"I'm tending to stay away from India," he said. "There's something wrong. Too many things are happening."
Indian doctors hit back
Indian physicians do not share the concerns.
"Our drugs are being sold in many countries and being accepted, so we have no issues," said Narendra Saini, Secretary General of the Indian Medical Association, a voluntary body of 215,000 doctors. "How do I know that western drugs are better than our drugs?"
A 2012 report by India's Parliament alleged collusion between pharmaceutical firms and officials at the Central Drugs Standard Control Organization (CDSCO), the country's drugs regulator, and described an agency that was both understaffed and underqualified.
Saini said physicians trust that the CDSCO is taking care of the quality and the standard of the drugs made in India.
"We very much trust those medicines," he added.
Representatives of Ranbaxy, Sun and Wockhardt were not immediately available to comment.
Dr Joel Zonszein, director of the Clinical Diabetes Center at Montefiore Medical Center in New York, said he is concerned about the quality of generic drugs in general, not just those from India. He cited, as an example, his experience with the diabetes drug metformin.
"When patients open the bottle of medication it smells like dead fish," he said. Zonszein did not know which company made the foul-smelling drug.
Physicians do not have a say in which generic drug a patient receives, as that depends on which products are stocked by individual pharmacies. If a patient wants to avoid a certain manufacturer, he or she may have to change pharmacies.
Doctors may specify that the branded version of a drug be dispensed, but insurance companies frequently refuse to pay for them.
Dr Richard Kovacs, who heads a number of American College of Cardiology committees and sits on its board of trustees, said doctors may need to play a greater role monitoring the medications prescribed by their practices.
"The average US cardiologist has been able to assume that the drugs were safe and effective. It now appears we need to be more vigilant as a profession, and assist the FDA by reporting cases where we are concerned about irregularities in the drugs supplied to our patients," he said.
Hard to keep up
FDA Commissioner Margaret Hamburg, who recently returned from her first official visit to India, is urging greater collaboration between the two countries. During her visit, the FDA and India's Ministry of Health and Family Welfare signed a statement of intent to cooperate to prevent the distribution of unsafe drugs.
Shortly afterwards, India's drug controller general, G.N. Singh, said in an interview that the country will follow its own quality standards.
"The FDA may regulate its country, but it can't regulate India on how India has to behave or how to deliver," he said.
Some companies seem to be responding to the FDA's actions.
Piyush Nahar, an analyst with Jefferies India Private Ltd who recently met with a number of Indian drugmakers, said in a recent report that most companies "have increased their investment" in compliance and some are considering investing in U.S. or European facilities "to overcome challenges relating to both regulations and perceptions."
The array of recalls and warning letters can be dizzying.
Ranbaxy recently recalled more than 64,000 bottles of a generic cholesterol-lowering drug after doses were mixed up in a bottle, and Sun began recalling 2,528 bottles of a diabetes drug after a bottle was found to contain an epilepsy treatment.
Those mix-ups follow a recall in January by Dr. Reddy's Laboratories Ltd of more than 58,000 bottles of its heartburn drug lansoprazole due to a microbial contamination.
"It's hard to be sure on a day-to-day basis with the array of medications that you have to be potentially aware of that there's a specific problem with a specific medication from a specific generic manufacturer," said Dr. Elliott Antman, a cardiologist at Brigham and Women's Hospital in Boston.
The medical community is dependent on agencies such as the FDA, he added. "The bottom line for me is we have to make sure they have sufficient resources to do their job correctly."
To Dr Jason Gaglia, a diabetes expert at the Joslin Diabetes Center in Boston, the warning letters and import bans indicate the FDA is doing its job.
"Is it scary? Yes. But to me it means the system is working," he said.
Source: The Times of India
(5) FDI by domestic companies recovers in FY14, around $30 bn so far
Outward foreign direct investment from the country, which was on a slippery road in the past two fiscals, has seen some signs of recovery this fiscal with the total deal value touching $29.34 billion so far, says a report.
"The period between FY07 and FY11 has been buoyant at times for outward FDI, but there has been a slowdown since then. Investments declined in FY12 and FY13, but there has been a recovery in FY14 so far," Care Ratings said in a report.
Total FDI investments made by domestic companies in April-January of FY14 stood at $29.34 billion, the report said.
The declining trend in outward FDI started from FY11, when it stood at $19.25 billion. It fell to $11.18 billion in FY12, and to $7.13 billion in FY13.
The rating agency said after moderate FDI between FY03 and FY04, investments started gradually increasing because of relaxations in the overseas investment policy in 2004.
Outward investments by domestic companies picked up significantly in FY07 and peaked in FY09 with investment at $19.45 billion abroad, it said.
FDI is divided into three categories — equity, loans and guarantee-issued. Most of the investments are made in the form of guarantee-issued, followed by equity and, lastly, loans.
Out of the total investments made in the April-January period of FY14, $19.12 billion were guarantee issued, which accounted for 65.1%, Care said.
During the period, investment in equity and loans stood at $7.1 billion and $3.21 billion with a share of 23.9% and 11%, respectively.
On a sectoral basis, the highest investment of $8.91 billion was in the transport, storage and communication services space while $7.56 billion were invested in manufacturing-related activities, the report said.
Activities such as wholesale, retail trade, restaurant and hotels have attracted $2.91 billion from domestic companies in FY14 so far.
Significantly, only $32 million were invested in electricity, gas and water and miscellaneous activities.
Geographically, the Netherlands and Singapore were the favourite destinations of domestic companies, with a share of 28.85 and 15.2% in total investments, respectively.
This was followed by the British Virgin Islands andMauritius with 10.3% and 7%, respectively, with the value $3.69 billion and $3.13 billion, respectively.
The US accounted for 7% of investments amounting to $2.13 million.
Domestic companies made smaller investments in countries such as Azerbaijan, the Cayman Islands, Hong Kong, Cyprus, Saudi Arabia, Belgium and Oman, the report said.
Source: The Indian Express
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