Corporates approach LIC to manage funds
Mumbai: Rising salaries, falling interest rates and increasing possibility of voluntary retirement have seen a major shift in corporate thinking, news reports say. Private and government-owned companies are favouring the state insurer — the Life Insurance Corporation of India (LIC) to manage employees' funds, as at the end of the day, they face the pressure and difficulty to achieve this in-house and at the same time ensure "adequate returns".

Others are turning to private insurers, which offer unit-linked group schemes that have gained popularity. Corporates need to provide gratuity and superannuation schemes for their employees. Some companies also provide for pension schemes, which in view of the falling interest rate scenario, is becoming an expensive affair. Last year interest rates fell by 150 basis points. The year before, the fall was even steeper by 300 basis points.
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Karvy opens more branches in Andhra
Hyderabad: Karvy, an integrated financial services major, has announced the opening of three more branches in the twin cities of Hyderabad and Secunderabad at BHEL, Tarnaka and Mehdipatnam. The company said its network has now increased to 178 offices across the country. Of this, 16 branches are located in the twin cities.

According to the company, the branches will offer a wide range of financial services ranging from stockbroking, demat services, investments in mutual funds, equity and bonds, insurance, loans and personal property services. Karvy chairman C Parthasarathy said the opening of the branches was in sync with Karvy's vision of offering financial services at the doorstep of every customer.
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ADB okays $400-million loan for rural road project
New Delhi: The Asian Development Bank (ADB) has approved a $400-million loan for building 11,000 km of all-weather roads in Madhya Pradesh and Chhattisgarh as part of the Pradhan Mantri Grameen Sadak Vikas Yojana. The $400-million loan for the Rural Roads Sector I Project, cleared by the ADB's board in Manila, will also be utilised to establish management systems to ensure sustainability of the road networks, according to a top ADB official said.

ADB's loan comes from its ordinary capital resources with a 25-year term, including a grace period of five years. The spread is determined in accordance with ADB's LIBOR-based lending facility. ADB will also provide a technical assistance grant of $1 million financed by the government of the UK to prepare a second phase of the project.
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RBI: High liquidity, low inflation may not continue
Mumbai: Reserve Bank of India (RBI) deputy governor Rakesh Mohan has said that there is no assurance that the current trends of excess liquidity accompanied by low inflation will necessarily continue in the world. "It is also possible that the current phenomenon of increasing savings rates in Asian countries like India and China does not continue to be valid over the next medium to long term. If that happens, there could again be a reversal of capital flows.

"There will then be tightening of liquidity in world capital markets with increased competition for resources. Thus, recent experience tells us that such reversals can occur very rapidly... there is no assurance that the current trends of excess liquidity accompanied by low inflation will necessarily continue in the world."
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India must use forex reserves to retire high-cost debt: SBI
Mumbai: India should prepay high-cost debts at the earliest to minimise the cost of managing the ballooning foreign exchange reserves, says SBI. "Even if the foreign exchange reserve (FER) management by the RBI has been excellent, it will be prudent that high-cost foreign debts, must be prepaid at a faster pace so that the cost of FER is kept at bare minimum level. If FER continues to increase at the current pace, it will have an enormous impact on Indian economy."
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