20000208

Indian minister rules out cut in EPF rates

BOMBAY: India's labour minister on Monday ruled out any cut in the interest rates on the Employees Provident Fund, the Press Trust of India said.

"There will not be any reduction in the interest rates on EPF, which is currently at 12 percent, and no such proposal is under consideration of the government," the news agency quoted labour minister Satyanarayan Jatiya as saying. The federal government cut the interest rates on deposits on the Public Provident Fund (PPF), a voluntary savings scheme, and on post office deposits by 100 basis points from January 15.

Analysts have viewed these rates as references for banks' deposit rates and in turn for their lending rates. The PTI quoted Jatiya as saying the government will be able to meet the higher interest burden despite the increased inflows into these small savings schemes and the transfer of such funds to state governments.

Reducing interest rates on EPF was not really necessary, he added.

Analysts said the combined fiscal deficit of the federal and state governments, along with the losses of public sector units, is close to 8.0-9.0 percent of gross domestic product (ADR amongst options) India's Reliance Petroleum Ltd on Monday responded to queries from the country's main bourses and said it is evaluating several options on an issue of shares.

"Reliance Petroleum Ltd is evaluating several alternatives vis-a-vis its equity share capital, including, listing of ADRs on the New York Stock Exchange, and/or placing its equity shares with strategic international investors, at an appropriate time," a company statement said.

It said necessary information will be provided to all authorities as soon as a firm decision is taken.

The Economic Times newspaper had reported on Monday that Reliance Petroleum was considering a proposal to place five percent of its equity with leading international crude suppliers at a price of around 90 rupees per share.

Reliance Petroleum shares were up 5.40 rupees or at a circuit breaker limit of eight percent at 73.40 at the Bombay exchange in afternoon deals.