• Slowdown ahead, signals RBI
• Rs 62,000-crore stimulus package for credit-hit MSMEs on cards
• Norms revised for insurers opening offices abroad
• Pfizer to pop Wyeth for $68b
• Relief may be on way for Jaguar-Land Rover
• Reserve Bank of India (RBI) has said in its quarterly report ahead of the Monetary Policy review that economic growth could moderate significantly due to a drop in domestic demand, the global economic slowdown and deterioration in global financial markets. It also added that the risks to inflation had come down significantly due to the softening in international food and oil prices. It has forecasted that GDP growth could drop to 6.8 % during the current financial year, after clocking 9 per cent or more during the last three years. (BS)
• According to sources, Micro, small and medium enterprises (MSMEs) could be the biggest beneficiary of govt‘s next stimulus package. The MSME ministry has asked RBI for a Rs 62,000-crore priority sector lending for the sector and RBI is learnt to have convened a meeting with banks and representatives of the sector on February 3 to chalk out ways to inject credit into the sector, which is finding it impossible to raise funds owing to tight liquidity situation at home and abroad. (FE)
• At present, priority sectors such as agriculture, education, health and MSME get 40% of year’s total bank lending, of which agriculture has sub-target of a mandatory share of 18%. According to an official, the MSME ministry has proposed to RBI that the sector be given a mandatory 15% share of the total priority sector lending. “The sector had received around 12% of the priority sector lending last year,” the ministry official added.
• Insurance Regulatory and Development Authority (IRDA), in its recently notified revised guidelines for opening of representative/liaison offices overseas by Indian insurers has said that the representative offices of Indian insurance companies abroad should function as an extended arm of their parent in India without contracting any liability outside the country. Further, good financial strength (as exhibited in the accounts) and maintaining of the prescribed solvency requirement (of 1.5) would be must for any company which wants to open its representative office abroad. (BL)
• According to sources, New-York based Pfizer is buying rival drug-maker Wyeth in a $68-billion cash-and-stock deal that will increase its revenues by 50%, solidify its No. 1 rank in the troubled industry, and transform it from a pure pharmaceutical company into a broadly diversified health-care giant. Pfizer is also cutting 10% of its work force of 83,400, slashing its dividend, and reducing the number of manufacturing sites. Pfizer would pay $50.19 per share under for Wyeth, valuing Wyeth at a 14.7% premium to the company’s closing price of $43.74 on Friday. (ET)
• According to sources, Tata group-owned Jaguar-Land Rover (JLR) is hoping to get some financial relief with Britain’s business secretary Peter Mandelson meeting representatives of the UK auto industry to discuss a bailout package. The package being discussed is expected not to be a bailout, but measures like credit guarantees or loans to ease the flow of liquidity. (ET)
