India plans to raise 50 billion rupees ($809 million) by selling additional units of a fund made up of shares in public sector companies, a source involved in the discussions told Reuters, a move which would boost government efforts to trim its deficit.
The previous government had set up the exchange traded fund (ETF) last year as a way of selling shares in 10 state-owned companies. It raised 30 billion rupees in an oversubscribed offering as investors welcomed access to a basket of firms.
The government of Prime Minister Narendra Modi, elected last May, hopes to again tap appetite for a fund that has outperformed the Indian market, already one of Asia's strongest performers.
Goldman Sachs, which is the asset manager of the fund, is set to issue the new ETF units before the end of the fiscal year on March 31, the source said.
"We have the finance ministry's go-ahead and are working out the final details," the source, who is directly involved in proceedings said. The source cannot be named as discussions are confidential.
The government has set a target of $10 billion to be raised by selling government-held shares, in order to trim the fiscal deficit to a seven-year low by the end of March.
Expanding the Central Public Sector Enterprise (CPSE) ETF would be a welcome lift.
The ETF comprises 10 stocks, mixing heavyweights such as Coal India Ltd and Oil & Natural Gas Corporation Ltd with laggards such as Bharat Electronics Ltd and Engineers India Ltd.
The unit value of the fund has increased 38.8 percent since its launch last March, outperforming a strong 30.6 percent rise in the NSE index during the same period.
To date, the current government has raised $3.9 billion of its $10 billion target, most of it coming from last week's record offering of a 10 percent equity stake in state-run Coal India.
However, plans for a second exchange traded fund announced last year have been put on hold, the source added. The fund was to have been made up of government-held minority shares in non-state firms including ITC, Larsen & Toubro and Axis Bank.
Finance ministry officials declined to comment but said that the government was considering all options to meet its target.
"We are working on many issues," Aradhana Johri, secretary in-charge of the government's disinvestment programme, had said on Friday after the sale of Coal India shares.
A Goldman Sachs spokesman declined to comment. ICICI Securities was not immediately available for comment.
($1 = 61.7849 rupees)
The previous government had set up the exchange traded fund (ETF) last year as a way of selling shares in 10 state-owned companies. It raised 30 billion rupees in an oversubscribed offering as investors welcomed access to a basket of firms.
The government of Prime Minister Narendra Modi, elected last May, hopes to again tap appetite for a fund that has outperformed the Indian market, already one of Asia's strongest performers.
Goldman Sachs, which is the asset manager of the fund, is set to issue the new ETF units before the end of the fiscal year on March 31, the source said.
"We have the finance ministry's go-ahead and are working out the final details," the source, who is directly involved in proceedings said. The source cannot be named as discussions are confidential.
The government has set a target of $10 billion to be raised by selling government-held shares, in order to trim the fiscal deficit to a seven-year low by the end of March.
Expanding the Central Public Sector Enterprise (CPSE) ETF would be a welcome lift.
The ETF comprises 10 stocks, mixing heavyweights such as Coal India Ltd and Oil & Natural Gas Corporation Ltd with laggards such as Bharat Electronics Ltd and Engineers India Ltd.
The unit value of the fund has increased 38.8 percent since its launch last March, outperforming a strong 30.6 percent rise in the NSE index during the same period.
To date, the current government has raised $3.9 billion of its $10 billion target, most of it coming from last week's record offering of a 10 percent equity stake in state-run Coal India.
However, plans for a second exchange traded fund announced last year have been put on hold, the source added. The fund was to have been made up of government-held minority shares in non-state firms including ITC, Larsen & Toubro and Axis Bank.
Finance ministry officials declined to comment but said that the government was considering all options to meet its target.
"We are working on many issues," Aradhana Johri, secretary in-charge of the government's disinvestment programme, had said on Friday after the sale of Coal India shares.
A Goldman Sachs spokesman declined to comment. ICICI Securities was not immediately available for comment.
($1 = 61.7849 rupees)
A "breakthrough understanding" to open India's nuclear power sector to U.S. firms reached during President Barack Obama's visit to New Delhi last month could be finalised this year, Indian officials say.
The Jan. 25 announcement by Obama and Prime Minister Narendra Modi followed six weeks of intensive talks, but few details were released beyond a framework based on India's acceptance of the principle that plant operators should bear primary liability in the event of a nuclear disaster.
Significant work remains on the fine print of a deal aimed at unlocking projects worth tens of billions of dollars that have been stuck the drawing board for years. India wants to nearly treble its installed nuclear capacity, which would make it the world's second biggest market after China.
U.S. officials say details of an insurance scheme to protect suppliers from crippling lawsuits need to be thrashed out and India still has to ratify a U.N. nuclear convention. Indian officials do not rule out completing the process this year.
"We are committed to moving ahead on all implementation issues at an early date," said Syed Akbaruddin, chief spokesman at India's Ministry of External Affairs. "There are no policy hurdles left."
General Electric and Westinghouse, a unit of Japan's Toshiba, were fully briefed on the meetings of a nuclear "contact group" that hammered out the nuclear compromise in London, say sources with direct knowledge of the talks.
Bringing them into the mix was crucial because the prospect of huge lawsuits, like those against Union Carbide over the 1984 Bhopal gas disaster, has until now kept U.S. and other foreign firms on the sidelines.
India and the United States signed a landmark agreement to cooperate on nuclear power back in 2008. Yet an expected bonanza never materialised because India later passed a law that would expose reactor makers to liability if there was an accident.
The liability issue has became a metaphor for the unrealised potential of the bilateral business relationship and a question mark against Modi's "Make in India" mantra.
"NOT INCOMPATIBLE"
As the days counted down to Obama's visit, Indian officials persuaded their U.S. counterparts that their law was "not incompatible" with international standards that place the burden of liability on the operator, said one senior U.S. official.
New Delhi also proposed setting up an insurance pool with a liability cap of 15 billion rupees ($244 million). The state-run Nuclear Power Corporation of India would pay premiums to cover its liability. Suppliers would take out separate insurance against their secondary liability - which could not exceed that of the operator - at a "fraction" of the cost.
India must still ratify the International Atomic Energy Agency's Convention on Supplementary Compensation for Nuclear Damage (CSC), which requires signatories to channel liability to the operator and offers access to relief funds.
"We would be looking at how quickly we can ratify the CSC - this is part of our assurance to the suppliers, along with the insurance pool," said an Indian member of the contact group, set up by Obama and Modi at a Washington summit last year.
The U.S. official said Washington expects the Indians to ratify with the IAEA in the near future, along with documentation "stating what their law intends" on the issue of liability, which should offer further reassurance to U.S. firms.
A QUESTION OF DETAIL
The U.S. industry would have preferred the issue to be settled by amending the liability law, something considered politically impossible for Modi to achieve at the moment.
"We want to see all the detail before we say: 'Yes, it works for us'," Westinghouse President and CEO Daniel Roderick, who joined Obama's delegation, told Reuters.
That note of caution, however, masks the extent to which negotiators engaged with the industry to address fears that it could end up on the hook in a disaster on the scale of the 2011 reactor blasts at Tepco's plant in Fukushima, Japan.
"For the first time, we had a comprehensive inventory of concerns," said the Indian negotiator.
Westinghouse has been granted land in Modi's home state of Gujarat to build six reactors, while GE Hitachi Nuclear Energy is eyeing a similar project in Andhra Pradesh. The liability roadblock has prevented commercial talks from starting on the projects, with a combined capacity of 10,000 megawatts.
India has 21 nuclear reactors with an installed capacity of 21,300 MW. It plans to launch construction of 40,000 MW of capacity in the next decade.
The Jan. 25 announcement by Obama and Prime Minister Narendra Modi followed six weeks of intensive talks, but few details were released beyond a framework based on India's acceptance of the principle that plant operators should bear primary liability in the event of a nuclear disaster.
Significant work remains on the fine print of a deal aimed at unlocking projects worth tens of billions of dollars that have been stuck the drawing board for years. India wants to nearly treble its installed nuclear capacity, which would make it the world's second biggest market after China.
U.S. officials say details of an insurance scheme to protect suppliers from crippling lawsuits need to be thrashed out and India still has to ratify a U.N. nuclear convention. Indian officials do not rule out completing the process this year.
"We are committed to moving ahead on all implementation issues at an early date," said Syed Akbaruddin, chief spokesman at India's Ministry of External Affairs. "There are no policy hurdles left."
General Electric and Westinghouse, a unit of Japan's Toshiba, were fully briefed on the meetings of a nuclear "contact group" that hammered out the nuclear compromise in London, say sources with direct knowledge of the talks.
Bringing them into the mix was crucial because the prospect of huge lawsuits, like those against Union Carbide over the 1984 Bhopal gas disaster, has until now kept U.S. and other foreign firms on the sidelines.
India and the United States signed a landmark agreement to cooperate on nuclear power back in 2008. Yet an expected bonanza never materialised because India later passed a law that would expose reactor makers to liability if there was an accident.
The liability issue has became a metaphor for the unrealised potential of the bilateral business relationship and a question mark against Modi's "Make in India" mantra.
"NOT INCOMPATIBLE"
As the days counted down to Obama's visit, Indian officials persuaded their U.S. counterparts that their law was "not incompatible" with international standards that place the burden of liability on the operator, said one senior U.S. official.
New Delhi also proposed setting up an insurance pool with a liability cap of 15 billion rupees ($244 million). The state-run Nuclear Power Corporation of India would pay premiums to cover its liability. Suppliers would take out separate insurance against their secondary liability - which could not exceed that of the operator - at a "fraction" of the cost.
India must still ratify the International Atomic Energy Agency's Convention on Supplementary Compensation for Nuclear Damage (CSC), which requires signatories to channel liability to the operator and offers access to relief funds.
"We would be looking at how quickly we can ratify the CSC - this is part of our assurance to the suppliers, along with the insurance pool," said an Indian member of the contact group, set up by Obama and Modi at a Washington summit last year.
The U.S. official said Washington expects the Indians to ratify with the IAEA in the near future, along with documentation "stating what their law intends" on the issue of liability, which should offer further reassurance to U.S. firms.
A QUESTION OF DETAIL
The U.S. industry would have preferred the issue to be settled by amending the liability law, something considered politically impossible for Modi to achieve at the moment.
"We want to see all the detail before we say: 'Yes, it works for us'," Westinghouse President and CEO Daniel Roderick, who joined Obama's delegation, told Reuters.
That note of caution, however, masks the extent to which negotiators engaged with the industry to address fears that it could end up on the hook in a disaster on the scale of the 2011 reactor blasts at Tepco's plant in Fukushima, Japan.
"For the first time, we had a comprehensive inventory of concerns," said the Indian negotiator.
Westinghouse has been granted land in Modi's home state of Gujarat to build six reactors, while GE Hitachi Nuclear Energy is eyeing a similar project in Andhra Pradesh. The liability roadblock has prevented commercial talks from starting on the projects, with a combined capacity of 10,000 megawatts.
India has 21 nuclear reactors with an installed capacity of 21,300 MW. It plans to launch construction of 40,000 MW of capacity in the next decade.
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