IndUS Business Journal

Patel-Led Commercial Bank of California Receives Perfect Score from Leading Industry Analyst

Mar 10, 2016 0

IRVINE, Calif.– Commercial Bank of California (CBC), one of the nation’s highest capitalized banks, received a five-star rating from BauerFinancial, Inc. in the research firm’s most recent analysis of U.S. banks and credit unions, CBC announced.

The rating is based on financial data provided to the federal government and it reflects the financial stability of each institution. With one of the strongest capitalization rates in the country and a healthy rate of growth over the past five years, CBC stands out as one of the most secure lenders in America. The “superior” ranking from BauerFinancial further solidifies CBC’s reputation and strength in the marketplace.

Ash Patel

Ash Patel

“We are pleased with our recent rating by BauerFinancial. At Commercial Bank of California, we strive to provide the most personalized banking services to each of our customers, and we can only do that if we are on solid financial ground,” said Ash Patel, president and CEO of Irvine-based CBC. “Commercial Bank of California was built by entrepreneurs for entrepreneurs. Whether we are being relied on to provide capital for a merger, acquisition or start-up, our clients trust us to deliver exemplary financial services, and this “superior” rating by BauerFinancial validates that trust.”

Inspired by the best practices and experience of its holding company, the Meruelo Group, CBC serves small and mid-sized California businesses and entrepreneurs. It is a full-service bank offering clients all of the traditional deposit and lending services they are accustomed to, along with the convenience and innovation of internet banking.

The bank, which has branches in Irvine and Brea, is in the process of merging with the Brentwood-based National Bank of California, which has branches in Sherman Oaks, Beverly Grove and Costa Mesa. All branches will remain open after the deal closes.

BauerFinancial, Inc. is an independent research firm that offers objective analysis within the banking industry. It compiles rating reports for banks and credit unions based on financial data as it is reported to government regulators.

Commercial Bank of California is a full-service bank serving the business and professional communities in Orange County from two branches located in Irvine and Brea.

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Indian Policy and Business Briefs

Mar 10, 2016 0

Food ProcessingGovt. OKs 100% FDI in Marketing Food Products Made in India

Finance Minister Arun Jaitley said that 100 percent foreign direct investment is to be allowed in the marketing of food products produced and manufactured in India. This will benefit farmers, give impetus to food processing industry and create significant employment opportunities.

Threshold Limits Raised to Ease M&A

In a move aimed at improving the ease of doing business, the Government has raised the financial threshold limit for companies seeking approval from the Competition Commission for proposed mergers and acquisitions. The latest steps by the Corporate Affairs Ministry would benefit businesses, especially startups, where deal valuations are not too high.

Budget Allots $1 Billion for ‘Smart Cities,’ Urban Projects

The Government has allocated a little more than $1 billion for two key programs — the Atal Mission for Rejuvenation and Urban Transformation and ‘Smart Cities’ Mission. The names of the first 20 Smart Cities, including Bhubaneswar, Pune, Ahmedabad, Chennai and Bhopal, were announced late last month.

India, U.S. to Promote Traditional Treatments to Fight Cancer

India has partnered with the U.S. to collaborate on research and development of traditional medicines for preventive and palliative cancer care, a move aimed at bringing in more global acceptability and credibility for traditional treatments. The collaboration is also expected to open the market for traditional treatments.

Foreign Military Sales Procedure with U.S. Streamlined

The Ministry of Defense has streamlined the foreign military sales procedure with the U.S. to make it more efficient. Rather than raising bills on a case-by-case basis every quarter, all the funds against various cases have been pooled together in one body.

Global Tech Firms Eye Indian Expansion

Global technology companies such as Oracle and Cisco are lining up investments to capture opportunities under the Digital India and Make in India initiatives. Safra Catz, global CEO of Oracle said, “Digital India and Make in India are truly inclusive. We will release further resources to grow much larger in India.”

Private Equity Investments in India Hit New High in 2015

India was the top destination for private equity and venture capital investors in 2015. The country received a record $22 billion in investments last year, 32 percent more than the previous highest of $17 billion in 2007, according to a report by Bain & Co. India. Consumer technology, real estate, banking, financial services and insurance top the sectors that attracted investors, accounting for 65 percent of deal value.

Report: Luxury Car Sales in India to Double by 2020 

Analysts believe luxury vehicle sales in the country will more than double in the next five years. Luxury vehicle sales in 2015 grew 6.4 percent year compared to the previous year. The market was led by Mercedes-Benz, which won back the leadership position from Audi by selling nearly 12,900 units.

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How with $1.5 billion debt, business tycoon Vijay Mallya left India

Mar 10, 2016 0

New Delhi– Even as the Indian government on Thursday assured that “every possible action will be taken” against beleaguered liquor baron Vijay Mallya, the Congress hit out at the Centre asking “how did it allow Mallya to leave the country”.

Congress vice president Rahul Gandhi on Thursday questioned the government as to how it allowed liquor baron Vijay Mallya to leave the country.

Vijay Mallya (Photo: Twitter)

Vijay Mallya (Photo: Twitter)

“I asked a clear question to Jaitley-ji, How did Mallya-ji escape from India? Someone who has stolen Rs.9,000 crore from the government, how did you allow him to leave the country,” Gandhi asked.

The issue was also raised in the Rajya Sabha by Leader of Oposition Ghulam Nabi Azad of the Congress, who said Mallya should not have been allowed to leave as there were serious charges against him.

“He could have been identified even at the airport when he was leaving as he is a prominent figure and most people recognise him,” Azad said.

Finance Minister Arun Jaitley invoked the case of Italian businessman Ottavio Quattrocchi while countering Congress vice president Rahul Gandhi’s allegation that the government had failed to act against Mallya.

Quattrocchi was an Italian businessman who was sought until 2009 in India for criminal charges of acting as a conduit for bribes in the Bofors scandal.

Countering Rahul Gandhi’s allegation, Jaitley later told reporters: “Rahul Gandhi should understand that going away of Ottavio Quattrocchi and Vijay Mallya is not the same. When CBI had alerted government about Quattrocchi, it was a criminal case and the then government did not stop him.”

Jaitley also added that there is a legal procedure on impounding a passport and action could be taken only based on the provisions of the Passport Act.

During Zero Hour in the Lok Sabha, Jaitley said Mallya, as of the end of November 2015, owed about Rs.90 billion to various banks in the country.

He was responding to the issue raised by Congress floor leader Mallikarjun Kharge, who wanted to know why the government did not “confiscate” the passport of the chief of the now defunct Kingfisher Airlines.

The Congress leader wanted to know why the government and State Bank of India did not act against Mallya in time, which helped him to flee.

Jaitley said every member of the house shares the concern raised by Kharge, but said the sanction of money to Mallya was made during the UPA regime.

“The banks have started taking action against the companies to recover the debt. Certainly every possible action will be taken against all the defaulters,” Jaitley said in the Lok Sabha.

“Some cases were filed in different courts across the country and some counter-cases were also registered,” he added.

Jaitley also said that as of November 30, 2015, the total dues compounded with interest stands to the tune of over Rs.9,000 crore ($1.5 billion) against Vijay Mallya’s companies.

“As far as accounts are concerned, first sanction was made by the consortium of banks in September 2004,” and then again in 2008. “These dates speak for themselves,” he said.

Minister of State for Parliamentary Affairs Rajiv Pratap Rudy said Mallya was “no saint” for the NDA regime.

Dissatisfied with Jaitley’s reply over Mallya leaving the country, the Congress and the Left parties staged a walkout.

Meanwhile, the biggest public sector lender State Bank of India denied any laxity on the part of the consortium of banks in seeking reliefs against the defunct Kingfisher Airlines Ltd. (KFAL), its promoters and holding-associated company.

It also refuted certain media reports (Not the IANS) purportedly blaming the SBI, the leader of the consortium, for the crisis and termed these as based on “hearsay and conjecture”.

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India dares Monsanto with 70 percent cut in technology fees

Mar 10, 2016 0

By Vivian Fernandes

The union agriculture ministry headed by Radha Mohan Singh has notified a sharp, 70 percent reduction in fees payable to Mahyco-Monsanto Biotech (MMBL) for its patented cottonseed technology, disregarding the company’s threat that it would have “no choice but to re-evaluate every aspect of our position in India”, if this were to happen.

The issue has acquired nationalist vs multinational overtones and might deter investors from coming to ‘make in India’.

Radha Mohan Singh

Radha Mohan Singh

The ministry has set the maximum selling price for a 450-gram pack of the genetically-modified seeds known by the trade name Bollgard II or BG-II at Rs.800 for the whole of India. This includes a technology fee of Rs.9 and seed value of Rs.751.

The maximum selling price of the previous version called BG-I has been fixed at Rs.635. The ministry has said no technology fee is payable for it, as it is off patent. BG-I was the first genetically-modified cottonseed which India approved for cultivation in 2002.

MMBL was charging Rs.163 per pack as technology (trait) fees for BG-II, which has two insecticidal genes obtained from agro-bacteria for greater resistance to a deadly pest called bollworm. It has been asserting that trait fees are governed by private agreements and cannot be decided by the government. Trait fees are different from royalty for which MMBL charges a lumpsum when licensing the technology.

The agriculture ministry brought Bt cottonseeds under price control last December. MMBL has moved the Delhi High Court against the order, and specifically against government regulation of trait fees. But it failed to obtain relief at a hearing on March 9. The next hearing has been fixed for March 23.

Currently, various states have price control orders. Maharashtra had fixed the price of BG-II at Rs.830 for the 2015 sowing season, ahead of the monsoon. The rate in Telangana, Andhra Pradesh, Gujarat, Tamil Nadu and Karnataka is Rs.930. In Punjab and Haryana it is Rs.1,000. The central government order supersedes them all. It introduces a single price for the whole country.

Earlier attempts by states to fix trait fees were quashed by courts, though they have upheld their authority to fix prices.

The nine-member price committee set up by the agriculture ministry did not have a representative of MMBL though BG-II covers nearly all of India’s cotton acreage.

“We are in the process of examining the notification in detail and will be able to comment only after we study the document in its entirety,” MMBL’s spokesman said.

Kalyan Goswami, the rxecutive director of the National Seeds Association of India (NSAI), said it was “pleased to note that the farmers’ voice had been heard by the Ministry of Agriculture”. NSAI had asked the ministry to lower the trait fee because BG-II technology was facing “redundancy”. NSAI is a party to the dispute in the high court.

There have been reports of pink bollworm developing resistance to the technology in parts of Gujarat, Maharashtra and Telangana. The state-owned Central Institute of Cotton Research said that about ten percent of the crop had been affected. But the resistance can be managed. The technology is still effective against other varieties like the American bollworm and the spotted bollworm.

“We strongly oppose the decision… as it violates the principles of free market economics,” Shivendra Bajaj, executive director of the Association of Biotech-led Enterprises-Agriculture Focus Group (ABLE-AG) said in a statement. ABLE-AG is a grouping of 13 agri-biotech companies.

“By slashing trait fees, the government has clearly shown that it is going for short-term populist measures rather than supporting innovation… The decision will be detrimental in the long run as companies may have to reconsider their investments in seed-based R&D… due to the current uncertain environment,” Bajaj added.

In this battle of between nationalists and a multinational who will come on top?

The president of NSAI is Prabhakar Rao, the founder and managing director of Hyderabad-based Nuziveedu Seeds Limited (NSL). MMBL has terminated the licenses of NSL and its two subsidiaries, which were its largest franchisees. MMBL says the three companies have not paid it about Rs.165 crore in trait fee dues collected from farmers. Rao is said to be close to the agriculture minister.

The ministry has also made a reference to the Competition Commission of India (CCI) to investigate MMBL for abuse of dominance. The CCI will look into the issue.

There has been a virtual, though not formal, split in the NSAI, with multinational members of the association opposing the NSAI’s official stance in favour of price control and reduction of trait fees.

Some commentators have warned the agriculture ministry against sending a message that would unnerve investors. The government has been urged to try competition, not price controls as means to reduce prices. Encouraging technologies rival to BG-II should be the route to take, it was suggested.

Several business newspapers have said the government should not be disincentivising innovation and firms like Monsanto.

But while the government is talking about “Make in India”, its ministers seem to be unmaking the effort.

(Vivian Fernandes is editor of www.smartindianagriculture.in.)

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NHRC notice to Mumbai police over brutality with Canadian businessman

Mar 8, 2016 0

New Delhi–The National Human Rights Commission has issued notice to Mumbai police and two lawyers following a complaint from a Canadian businessman alleging harassment by police personnel, including two senior officers of the department who allegedly acted on the directions of a local businessman.

Confirming the news, the commission said on Tuesday that Alnoor Jamal, a Canadian senior citizen of Indian origin, had a dispute with a local businessman named Shobhit Rajan in respect of the Parke Davis property — now called Rajaskaran Tech Park in the city.

The complainant, in his petition to the NHRC, has stated that on the instructions of Rajan, Mumbai police officer of Khar and Marine Drive police stations, along with Rajan’s two lawyers, raided Jamal’s hotel room in South Mumbai. The incident happened on August 29, 2013.

Jamal had earlier petitioned the PMO which had referred the matter to the Maharashtra government for inquiry.

The complainant, in his petition, has also stated that the police personnel and the lawyers threatened him and his wife, coaxed them to settle the dispute with Rajan on the latter’s terms or face immediate arrest.

According to NHRC, notice was issued last week to Mumbai police and the two lawyers with a demand that they respond within four weeks.(IANS)

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Five Syndicate Bank officials booked in Rs.1,000 crore scam

Mar 8, 2016 0

New Delhi– The CBI on Tuesday registered a case against five Syndicate Bank officials, a CA, three private people and others on charges of causing a loss of Rs.1,000 crore to the bank by discounting of fake cheques and bills against fake insurance policies and overdraft limits against non-existent policies.

The bank officials have been identified as New Delhi branch’s then general manager Satish Kumar Goel, Jaipur regional office deputy general manager Sanjeev Kumar, Jaipur branch chief manager Deshraj Meena and assistant general managers of Malviya Nagar branch in New Delhi and Jaipur branch Adarsh Manchanda and Awdhesh Tiwari respectively.

Sources said that the fraud was unearthed recently and a Central Bureau of Investigation complaint was made after the suspension of the bank officials.

Goel was recently transferred to the Syndicate Bank’s New Delhi Branch.

The other accused have been identified as chartered accountant Bharat Bamb, a resident of Udaipur, and three Jaipur residents identified as Shankar Khandelwal, Piyush Jain and Vineet Jain.

All of them have been booked by the CBI under charges of criminal conspiracy, using a forged document as genuine, cheating and forgery of Indian Penal Code (IPC) and sections of Prevention of Corruption Act.

“It was alleged that the accused persons in connivance with the bank officials committed a fraud of Rs. 1,000 crore by resorting to discounting of fake cheques and fake inland bills against fake LICs and arranging over-draft limit against non-existent LIC policies,” said CBI spokesperson Devpreet Singh.

He said that the fraud was allegedly committed at Jaipur and Udaipur branch in Rajasthan and Malviya Nagar branch in Delhi.

“It was further alleged that the bank officials of the two branches were colluded with private persons in the crime since 2011. The amount involved in individual transactions ranged from Rs. 40 lakh to Rs.5 crore but majority of them were in the range of Rs.2.5-4 crore,” the official said.

To avoid detection, many of these transactions were nullified from the proceeds of new fraudulent transactions, he added.

“Searches are being conducted at 10 locations including Jaipur, Udaipur and New Delhi which led to recovery of incriminating documents,” the official added.

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Second Haryana investor summit in 2018

Mar 8, 2016 0

Gurgaon–Buoyed by success of the first-ever ‘Happening Haryana Global Investors’ Summit’, Chief Minister Manohar Lal Khattar said on Tuesday that its second edition would be held some time in 2018.

Manohar Lal Khattar

Manohar Lal Khattar

The success of the summit is measured by the fact that against the target of Rs.1 lakh crore, the state government has signed 357 MoUs for a total potential investment of Rs.5.84 lakh crore which is 500 times more than expectations, he said in his address at the valedictory session of the summit.

It is a matter of great satisfaction that 39 of the total MoUs involving investment of Rs. 1.28 lakh crore are for the districts not falling in the national capital region, he said, adding 10 percent of the MoUs are with MNCs and 26 percent are in the MSME sector.

“The Summit has been a great success. It has given the most tangible proof of the faith and confidence industry and investors have in Haryana’s Enterprises Promotion Policy. The steps taken by the government to usher in a new era of balanced regional growth have met recognition from investors,” said Khattar.

He assured that all necessary clearances would be granted within 30 days from the date of application.

Referring to the target fixed for attracting investment, the chief minister said that the positive response Haryana attracted from investors during his visits to US and Canada encouraged him to organise the Summit and that he was surprised to learn from officers that Haryana never held such an event.

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PGIM Completes Acquisition of Deutsche Bank’s Asset Management Business in India

Mar 8, 2016 0

NEWARK, N.J.–PGIM, the global investment management businesses of Prudential Financial, Inc. (NYSE:PRU), has completed its previously announced acquisition of Deutsche Bank’s Indian asset management business through its Mumbai-based affiliate. With $963 billion in assets under management as of Dec. 31, 2015, PGIM ranks among the world’s largest investment management companies.

In August 2015 PGIM announced it had reached a definitive agreement to acquire an indirect ownership interest in Deutsche Bank’s Indian asset management business through its affiliate in India, DHFL Pramerica Asset Managers.

“This acquisition underscores our commitment to serving clients in key strategic markets,” said David Hunt, CEO of PGIM. “Across our multi-manager platform, we are committed to delivering the highest standards of investment expertise and advice to our clients in India and globally.”

Glen Baptist, CEO of PGIM’s International Investments business added, “Deutsche Bank’s highly respected asset management leadership team and its deep relationships with institutional clients and distribution partners complement the strong team we already have in place and positions us to build an industry leading asset manager in India.”

With approximately $4 billion in combined assets under management as of March 4, 2016, the acquisition significantly expands PGIM’s product portfolio, distribution platform and client services in India.

DHFL Pramerica Asset Managers is a 50:50 joint venture between Prudential Financial, Inc., and Dewan Housing Finance Corporation Limited. DHFL Pramerica Asset Managers began its joint venture partnership in India in August 2015.

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Airbus plans $2 billion cumulative procurement from India in five years

Mar 8, 2016 0

Bengaluru– Global aerospace major Airbus Group plans to procure components and sub-systems worth $2 billion cumulatively for a period of five years till 2020 for its civil and defence projects — up from $500 million in 2015, the European consortium said on Monday.

“We have set our sight to exceed $2 billion in cumulative procurement annually by 2020 from over $500 million worth aerospace goods in 2015 for civil and defence projects,” the Indian arm of Airbus said in a statement here.

Procurement value increased 15 percent in 2015 over that of 2014.

About 6,000 skilled people at 45 state-run and private suppliers side across the country provide engineering and IT services, aero-structures, detail parts and systems, materials and cabins to the group for many of its leading platforms, including A380, A350 XWB, A320 family, A330, C295W, A400M, Eurofighter, Tiger and NH90.

Claiming that every Airbus commercial aircraft was partly ‘made in India’, Airbus chief procurement officer Klaus Richter said Indian suppliers were a cornerstone of its globalisation strategy.

“As many projects with our Indian partners have been successful, we aim to strengthen these relationships in the future,” Richter said on the occasion.

According to Airbus Group India president and managing director Pierre de Bausset, the company is ready to set up system integration and final assembly lines if its proposal of producing C295W military transporters in India with Tata and military helicopters with Mahindra fructify.

Further elaborating on its Indian procurement collaborations, Airbus said Hindustan Aeronautics Limited (HAL) manufactures half of A320 family forward passenger doors while Dynamite Technologies makes flap track beams.

Mahindra Aerospace has a contract with Airbus Group company Premium Aerotec to supply more than one million aero-components per annum while Wipro received technology transfer to produce 8,000 aerospace actuators per year.

“Infosys provides SAP development and maintenance services while Geometric supports on product life-cycle management (PLM) applications and CAD services. Tech Mahindra provides consulting services on Quality and Business Support,” said the statement.

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Women accounting for 99 percent of microfinance borrowers in India

Mar 8, 2016 0

New Delhi–With women accounting for 99 percent of microfinance borrowers in India, a major change occurring in the financial system is the greater responsiveness of formal banking sector to articulated needs of the population, the government said on Tuesday.

“The culture is changing in India … there is a greater responsiveness to the articulated needs of the people,” Financial Services Secretary Anjuly Chib Duggal said while addressing the South Asia conclave on Financial Inclusion here, organised by the Microfinance Institutions Network (MFIN).

Noting that the recent banking licences granted by the Reserve Bank of India to Bandhan Bank and other small financial institutions, Duggal outlined the future scenario for last-mile reach of finance to the needy.

“We’re looking, in a time span of three to five years, at a hybridisation of delivery points, at high-touch banking institutions, with microfinance institutions being among them,” she said.

The secretary said that borrowers of microfinance, of whom 99 percent are women, are now being referred to as such, and no longer as “beneficiaries”, because they come with concrete business plans.

“We’re looking at realignments in the banking sector, we’re looking at chemists as banking points,” she said, pointing out that a recent banking licence had been granted to a pharmaceutical company.

India is a “cradle of microfinance” with seven out of every 10 borrowers from the country and as many as 32 million borrowers in this category, of whom 99 percent are women, said MIN chief executive Ratna Vishwanathan.Bangladesh comes next with 22 million such borrowers.

She said the conference had deliberately chosen to open on International Women’s Day on Tuesday.

“The regional conference on financial inclusion looks at facilitating cross-learning among stakeholders of South Asia Micro-entreprenaurs Network (SAMN), and explore the role improved access to finance can play in unlocking the economic potential of the region by contributing to job creation, especially by promoting entrepreneurship among the youth and women,” she said.

Duggal described the microfinance culture as one “coming from the heart” that has enabled “opening up the mind to what people can do”.

“Microfinance institutions have given permissions to people, explicit and implicit, especially to traditionally disadvantaged sections like women. This impact has had the effect of motivating other people,” she said.

She cited the example of the Mudra Bank launched late last year to develop entrepreneurship, particularly among the disadvantaged sections.

Mudra, she said, had become a “runaway success” having already disbursed loans of Rs.1,15,000 crore.

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