McKinseys road map to higher GDP
New Delhi: International consultancy firm McKinsey has suggested scrapping of reservations for small scale industries, simplification of land and building laws, removal of restrictions on foreign direct investment in the retail sector and lowering of customs duties to enable India reach Chinas economic growth rate in just a few years.

In a report submitted to prime minister Atal Behari Vajpayee, McKinsey said Indias GDP can accelerate from the current 5.5 per cent to over 10 per cent in a few years. The report says that investments in infrastructure or introduction of labour reforms will not accelerate the growth. Instead, it said, the need is to increase the productivity of labour which is less than a tenth of the productivity levels in the United States.

According to the report, doing away with reservations for the small scale industries, restrictions on FDI in the retail sector and high customs duties will raise GDP by 2.3 per cent. Removal of tenancy laws and the urban land ceiling act will lead to an additional 1.3 per cent growth in GDP, while disinvestments, labour reform and development of infrastructure will accelerate the growth by 1 per cent.

"McKinsey has identified a number of factors which it says is responsible for the lack of growth that India can achieve. And for strategies and solutions, we will keep these in mind," said Finance Minister Yashwant Sinha.
Back to News Review index page  

US help to reforms in India
New Delhi: The US will begin second phase of assistance to India for reforms in financial markets. It extended support to Indias efforts to strengthen the securities regulation and provide safety to the investors.

"US will extend technical assistance on two initiatives that involves the Securities and Exchange Board of India (SEBI) directly," said the US ambassador to India, Robert D Blackwell.
Back to News Review index page  

Hiten Dalal convicted in Canbank case
Mumbai: Special court has convicted stock broker Hiten Dalal and former general manager of Canbank Mutual Fund (CBMF), B R Acharya for defrauding CBMF to the tune of Rs 32.5 lakh. Delivering the verdict, justice Sarosh Kapadia, however, acquitted T Ravi, co-accused and former Funds Manager, CBMF.

According to CBI, Dalal conspired with Acharya and Ravi in 1991-92 to gain financially by causing wrongful loss to CBMF. On March 9, 1992, he wrote a letter to CBMF claiming brokerage on investment of Rs 65 crore in CANCIGO although he was not entitled to such commission.

Acharya sanctioned the commission by endorsing the letter and referred the matter to Ravi who prepared a cheque of Rs 32.5 lakh and deposited in the account of Dalal in Andhra Bank on march 11, 1992, CBI prosecutors V C Gupte and Raja Thakre told the court.
Back to News Review index page  

DPCs arbitration notice on Centre
New Delhi: US energy major Enron's Dabhol Power Company (DPC) has slapped an arbitration notice on the Centre as the company did not expect its dispute with the Maharashtra state electricity board (MSEB) to be solved otherwise. Enron said it will not offer any discount over its equity in the 2,184 MW power project.
Back to News Review index page