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Enron Mail |
Enron Mandates SSSB For Credit-Linked Note Issue
Capital Markets Report, 05/02/01 UK: Enron plans multi-currency credit-linked bonds Reuters, 05/02/01 Enron to Sell Credit-Linked Notes in Several Currencies Bloomberg, 05/02/01 Saudi Gas Proj Consortia Seen Selected 2H May -Sources Dow Jones, 05/02/01 USA: Enron says no plans to sell Dabhol stake Reuters, 05/02/01 Centre spikes plan to fix Enron The Times of India, 05/02/01 India's Dabhol Pwr Co: Naphtha Supply Remains Regular Dow Jones, 05/02/01 Maharashtra Electricity Board unamused by new Enron demand The Hindu, 05/02/01 Sinha hopes sanctions will be lifted soon The Hindu, 05/02/01 Neither State nor MSEB has defaulted on agreement with Enron Press Trust of India Limited , 05/01/01 Sanctions hurt US interests more than India: Sinha Press Trust of India Limited, 05/01/01 Sinha confident US will lift sanctions in its own interest Press Trust of India Limited , 05/01/01 Sinha urges U.S., EU, Japan to boost growth AFX (AP), 05/01/01 U. Houston: U. Houston forum focuses on minority education U-Wire, 05/01/01 Prebon Yamane Hires Former RCN Executive to Run Bandwidth Unit Bloomberg, 05/01/01 Enron's Lay Discusses India's Dabhol Power Project: Comment Bloomberg, 05/01/01 Enron Mandates SSSB For Credit-Linked Note Issue 05/02/2001 Capital Markets Report (Copyright © 2001, Dow Jones & Company, Inc.) LONDON -(Dow Jones)- U.S. energy group Enron has mandated Schroder Salomon Smith Barney as bookrunner for a multi-currency credit-linked notes trust transaction. The transaction will consist of tranches in intermediate maturities. A launch will follow a European roadshow, subject to market conditions. UBS Warburg will be joint lead manager. UK: Enron plans multi-currency credit-linked bonds. 05/02/2001 Reuters English News Service (C) Reuters Limited 2001. LONDON, May 2 (Reuters) - Enron Credit Linked Notes Trust has mandated Salomon Smith Barney and UBS Warburg to lead manage a multi-currency transaction, the banks said on Wednesday. The issue will consist of tranches in intermediate maturities and will be launched following investor presentations in Europe. Enron to Sell Credit-Linked Notes in Several Currencies 2001-05-02 08:34 (New York) Enron to Sell Credit-Linked Notes in Several Currencies London, May 2 (Bloomberg) -- Enron Corp. plans to raise money by selling credit-linked notes in several currencies, according to Salomon Smith Barney, which will manage the sale with UBS Warburg. The sale will follow presentations to investors in Europe and will consist of issues of intermediate maturities, Salomon said in a faxed statement. Investors usually regard notes maturing in five to seven years to be intermediate maturities. Salomon declined to provide details on the size or timing of the sale. Credit-linked notes are typically backed by a pool of assets owned by the issuer. The payments on the notes are often linked to the creditworthiness of those assets. Houston-based Enron has branched out from its gas pipeline business to include trading in financial contracts such as gas and electricity futures and derivatives on corporate bankruptcies. Enron owns $65 billion in assets, including 32,000 miles of pipeline that span 21 states and transport 15 percent of all of the natural gas consumed in the U.S. Other assets include an 18,000-mile fiber-optic network in the U.S. and 51 power plants and other energy projects in 15 countries. Last week Enron agreed to cancel its $3.1 billion sale of Portland General Electric Co. to Sierra Pacific Resources, after both companies decided the California energy crisis had made it too hard to win approval. The state of California has banned power plant sales by utilities until 2006 amid an electricity shortage. Southern California Edison and PG&E Corp.'s Pacific Gas & Electric Co., California's two largest utilities, have run up more than $14 billion in debt from buying power at soaring prices. The two utilities are nearly insolvent. Enron has $15.8 billion in bonds outstanding, of which $2.7 billion mature this year, according to Bloomberg figures. Enron is rated ``BBB+'' by Standard & Poor's and ``Baa1'' by Moody's Investors Service. --Christine Harper in the London newsroom (44 20) 7330-7982 or charper@bloomberg.net with reporting by Adam Levy in Atlanta and Steve Farr in Princeton /zls Story illustration: {ENE US <Equity< DDIS <Go<} to graph Enron's debt. -0- (BN ) May/02/2001 12:34 GMT Saudi Gas Proj Consortia Seen Selected 2H May -Sources By Dyala Sabbagh Of DOW JONES NEWSWIRES 05/02/2001 Dow Jones Energy Service (Copyright © 2001, Dow Jones & Company, Inc.) DUBAI -(Dow Jones)- Consortium leaders and members for the three core gas ventures on offer in Saudi Arabia are expected to be announced in the second half of May, sources familiar with the negotiating process have told Dow Jones Newswires. As previously reported, the Saudi Arabian committee negotiating with international oil companies, or IOCs, on the so called Gas Initiative, recently submitted its proposals for consortium leaders to the kingdom's Supreme Petroleum Council for approval. Saudi Arabia invited international oil companies in October 1998 to participate in proposals for downstream gas projects and upstream gas enhancement. A series of meetings between the negotiating committee and shortlisted IOC's have taken place in the past year. Royal Dutch/Shell Group (RD), BP Amoco PLC (BP), Exxon Mobil (XOM), Chevron (CHV), TotalFinaElf (TOT) and ENI SpA (E) have been shortlisted for core venture number one, the $15 billion South Ghawar Area Development. Exxon, Shell and BP have been dubbed as the frontrunners with ExxonMobil seen as the strongest contender. For core venture two, the Red Sea Development, Enron Corp. (ENE) and Occidental Petroleum Corp. (OXY) are bidding jointly and Exxon Mobil, TotalfinaElf, Marathon Oil Canada Inc. (T.M), Shell and Conoco Inc. (COCA) have also been listed. Among these, TotalfinaElf and Shell are seen as strong possibilities. For core venture three, the Shaybah area, TotalFinaElf, Conoco, Phillips Petroleum (P), Enron & Occidental, Exxon Mobil, Shell and Marathon Oil have been listed. Conoco and TotalfinaElf are said to be frontrunners here. Role Of Consortium Leaders Still Unclear Sources have said some companies currently under consideration will be struck off the list in the final selection. Consortium leaders are expected to be responsible for directing further detailed negotiations on the projects at hand, such as pricing and finance. They are also likely to get the largest stake in any project as well as operatorship. But the IOCs are still in the dark as to what their exact roles will be in the event they are selected, industry sources said. Still, despite lacking a comprehensive framework, some deals are expected to be initialed this year. And once sealed, IOCs are also expected to start talking to local companies about contracting out participation on parts of the projects. The three ventures have a combined value of about $25 billion with each one having on average eight individual components. How these components will be dealt with or allocated is also as yet undetermined. Saudi Arabia has about 2.5 billion cubic feet of gas a day in its system currently and will have about 4 bcf/day by 2003. By 2025, it will need an estimated 14 bcf/day to meet its own consumption requirements and for possible export. By Dyala Sabbagh, Dow Jones Newswires; 9714 3314260; dyala.sabbagh@dowjones.com USA: Enron says no plans to sell Dabhol stake By C. Bryson Hull 05/02/2001 Reuters English News Service (C) Reuters Limited 2001. HOUSTON, May 1 (Reuters) - Enron Corp. has no immediate plans to sell its stake in the troubled $2.9 billion Dabhol power project in western India, the energy giant's chairman said on Tuesday. "We're not in any discussion right now on selling the plant," Enron Chairman Kenneth Lay told reporters after the company's annual meeting. He did not say whether the company planned to sell the project in the future. Enron has said in the past that it is unlikely to sell the plant until its payment disputes are resolved. "The lenders have sent the government of India a letter indicating the various things both the government of Maharashtra and the government of India need to do to come back into compliance with the contract." The Houston-based company and the government of the western state of Maharashtra have been locked in a payment battle for months, with the state's electricity board balking at paying Enron what it considers too high a rate for electricity. The fight is also now with the national government of India, which is contractually bound to cover defaulted payments by Maharashtra, but has since changed that position. At present, Maharashtra's State Electricity Board (MSEB) owes the Dabhol Power Plant, of which Enron is a 65 percent stakeholder, some $48 million for power. The Dabhol project, the single largest foreign investment in India, consists of two phases, the already-built 740 megawatt power plant and a 1,444 MW plant that is expected to be finished this year. The second phase could be finished later if the payment issue remains unresolved, Lay said. "The construction activity is being scaled down, so it is impacting operations, but its still not too late to stop any damage from that if the governments step up and honor the contracts," he said. Last week, Dabhol's board authorized the plant's managing director to issue a preliminary notice of termination of service to MSEB. The notice, which has not been issued, would be the first step for Enron to pull out of the project. Both governments have a few more weeks to respond to the letter from the creditors, Lay said. Enron has already declared political force majeure, a legal maneuver that allows a party to break a contract because of situations beyond their control, such as coups or civil war. India can ill-afford the very public fight Dabhol has become, Lay said. "It sends a very bad signal to the rest of the world as to the difficulties of investing in India, which is not what India needs right now," Lay said. India needs a lof of foreign investment if the country expects to build up its infrastructure, he said. Indian Finance Minister Yashwant Sinha on Monday told Reuters "there is no need for us to think that because there is a problem with Enron it is necessarily going to act as a dampener to foreign direct investment." Centre spikes plan to fix Enron Vinu Lal 05/02/2001 The Times of India Copyright (C) 2001 The Times of India; Source: World Reporter (TM) MUMBAI: This one would have turned the table in favour of Maharashtra State Electricity Board (MSEB), only if the Centre had not opposed it. Even before the Dabhol Power Company (DPC) board meeting that took place in London on April 25, MSEB was readying with a termination notice intended to be slapped on Enron just in case. But both the Union ministries, of power and finance, struck down MSEB's termination notice plan. Sources confirmed that the board was legally advised to prepare a termination notice citing contractual default and that the MSEB chairman, Vinay Bansal had duly signed the notice. But in a marathon meeting between Union minister of power, Suresh Prabhu and finance minister, Yashwant Sinha on April 23, MSEB officials were advised not to act in haste as it would precipitate the issue. However, sources added that if MSEB had slapped the notice first, then the liquidated damages payable by the board would have been considerably less vis-a-vis the situation prevailing now where Enron has authorised the management to issue termination notice. ``It is still not clear why the Centre spiked the board's plan to issue a termination notice since they had a valid point in issuing the same citing the penalty of Rs 401 crore for misdeclaration of power. If Enron cites non-payment as a default, they are also liable to face termination for defaulting by misdeclaring their plant's capacity,'' sources added. Interestingly on April 22, Mr Prabhu was advised by the Shiv Sena leader, Bal Thackeray, on the issue where he was requested not to dump the project on Maharashtra. Since the project has sovereign guarantee of the Indian government, it was mandatory that the Union ministries of finance and power to clear the proposal of issuing a termination notice. The Cabinet sub-committee of the government of Maharashtra, which met thrice recently, had finalised the notice under Schedule 17.2 of the power purchase agreement, where the contracted party (Enron) has not obliged to PPA conditions citing the penalty issue. When contacted Vinay Bansal refused to comment on the issue where the Centre scuttled MSEB's plans. Legal sources associated with the board confirmed that under Section 17 of the power purchase agreement, MSEB had prepared a termination notice in retaliation to the drastic steps Enron was resorting to after payment defaults. India's Dabhol Pwr Co: Naphtha Supply Remains Regular 05/02/2001 Dow Jones Energy Service (Copyright © 2001, Dow Jones & Company, Inc.) NEW DELHI -(Dow Jones)- U.S. energy major Enron Corp.'s (ENE) India unit, Dabhol Power Co., is continuing to receive regular supplies of naphtha, a DPC official told Dow Jones Newswires Wednesday. The US$3 billion Dabhol power project has been mired in financial disputes since its main customer, the Maharashtra State Electricity Board, failed to pay several of its bills. The dispute has raised concerns about the regularity of DPC's naphtha supply. "We have a term agreement with Indian Oil Corp. (IOC) for the supply of naphtha until the end of this year," he said. He added that the plant will switch from naphtha to liquified natural gas as a fuel source in 2002. "I confirm that one or two shipments of naphtha are coming every month. Each shipment is carrying about 30,000 metric tons of naphtha. Shipments come depending on the power that Maharashtra State Electricity Board draws," hesaid. The naphtha is sourced from IOC's Gujarat refinery. A committee appointed to renegotiate the MSEB's power purchase agreement with the DPC will hold its first meeting with DPC management May 5, the Press Trust of India reported Tuesday. Dabhol has come under fire because of the relatively high cost of its power. Critics object to Dabhol charging INR7.1 a kilowatt-hour for its power, compared with INR1.5/KWh charged by other suppliers. -By Himendra Kumar, Dow Jones Newswires; 91-11-461-9427; himendra.kumar@dowjones.com Maharashtra Electricity Board unamused by new Enron demand Mahesh Vijapurkar 05/02/2001 The Hindu Copyright (C) 2001 Kasturi & Sons Ltd (KSL); Source: World Reporter (TM) - Asia Intelligence Wire MUMBAI, MAY 1. The Enron-sponsored Dabhol Power Company (DPC) appears to have adopted a twin-track approach - threaten withdrawal by terminating the power purchase agreement (PPA) and simultaneously asking the Maharashtra State Electricity Board (MSEB) to activate some features of the same accord. Just days before its board of directors met in London and authorised the local management to decide when the PPA should be terminated, the DPC asked the MSEB to operationalise the escrow agreement. This, sources said, was a bid to confuse issues by sending contradictory signals. An unamused MSEB shot off a letter saying the DPC, by invoking its rights under a force majeure clause enabling it to suspend the PPA, could not now ask for operationalising the escrow agreement. It had to be either of the two options, not both. Under an amended and restated accord, signed in March 1999, specific revenue collection centres of the MSEB were identified and collections from these would have to be lodged into a separate account in an identified bank; the cover had to be 1.25 times the monthly billing of the 1,444 mw phase II. Already, the escrow for Phase I is operational, with 32 revenue circles of the MSEB committed to the DPC to meet its billing. So far, despite the controversy surrounding the bills, they have not been encashed even once. Curiously enough, there had been, according to well- placed sources, some informal, even if feeble suggestions that the DPC may go slow on the activation of the second phase of the project, which the State says does not come within its ability to digest the burden. If so, why did it want the escrow to be operationalised? The MSEB had to point out, following this demand, that DPC could not have the cake and eat it too. It could not invoke the force majeure clause, then threaten to have the PPA terminated and at the same time, ask for activation of this feature of the PPA. At the London meeting of the Board, this issue was neither listed nor discussed. The escrow agreement, as designed, requires fresh infusion of funds through allocation of more regions of the MSEB's revenue network to meet shortfalls since the tariff is forever mounting or remains high and as the Godbole Committee pointed out, a "situation where virtually all of MSEB's revenues would be required to be escrowed to meet DPC payments". That would leave little "for wages and fuel, let alone additional power purchase" from any source and the Godbole panel wanted it cancelled. Was it, therefore, a demand for operationalisation of the agreement to see what steps the MSEB and the Government would take? PPA to be terminated in May? Even if DPC decides to issue notice terminating the PPA, it would not be earlier than mid-May since IDBI, which leads the consortium of Indian lenders guaranteeing the provisions made by the foreign lenders, had asked for a three-week freeze on any decision by the company. IDBI, which voted against authorising the local management to issue a notice terminating the PPA at its London meeting, suggested that by that time the re-negotiation could commence, even as members of the consortium led by it were consulted given their very high exposures. The IDBI-led consortium's cover of around Rs. 6,000- crores to lenders abroad makes it a major player in the events that would unfold in the near future. Its stand has been in sharp contrast to the overseas financiers, who were dismayed at the non-payment of bills by the MSEB in time, the disputes and the controversy surrounding the project. They are more inclined towards withdrawing from the project. Close between 70 and 80 per cent of the debt on the $ 3 billion project has come from foreign lenders. The Indian component also leads to serious concerns as those of their foreign counterparts. It is unlikely that the DPC board can take any decision independent of the wishes or inclinations of the lenders. In effect, the IDBI told the board, "Give us some time; we will come back." Now that the Madhav Godbole Committee has been expanded with the addition of the MSEB Chairman, the State Government and also a nominee of the Union Finance Ministry, negotiations could commence, but the DPC, which has adopted a blow hot, blow cold attitude, would have to respond. The Maharashtra Chief Minister, Mr. Vilasrao Deshmukh, has said that the moment the Centre nominates its representative, "we will write to the DPC to come for renegotiations". The DPC response would indicate the course it wants to take - terminate the deal or enter into talks. Sinha hopes sanctions will be lifted soon Sridhar Krishnaswami 05/02/2001 The Hindu Copyright (C) 2001 Kasturi & Sons Ltd (KSL); Source: World Reporter (TM) - Asia Intelligence Wire WASHINGTON, MAY 1. The Finance Minister, Mr. Yashwant Sinha, has expressed confidence that the United States will lift the economic sanctions against India "as quickly as possible". Mr. Sinha, here for the last few days to attend the Spring Meetings of the World Bank and the International Monetary Fund, had a number of bilateral meetings with his counterparts from around the world, including the U.S. Treasury Secretary, Mr. Paul O'Neill. The sanctions figured at the meeting with Mr. O'Neill, but only at the latter's instance. "He himself mentioned the issue of sanctions," Mr. Sinha told reporters at a press conference at the Indian embassy here. "India's views have been very clear. We have said from day one that the sanctions hurt U.S. interests more than they hurt Indian interests and the fact that they are raising it *with us is an indication of their keen desire to be able to do away with it as quickly as possible," he said. During a meeting here last month with Mr. Jaswant Singh, the Secretary of State, Gen. Colin Powell, raised the issue. Mr. Sinha said his meeting with Mr. O'Neill reflected a substantial measure of the commitment and interest of the Republican administration and the desire to pursue the outlines of the Vision Statement as it related to economic and financial matters. Mr. O'Neill accepted the invitation to visit India later this year to attend the second of a series of Cabinet-level forum meetings, first of which was held in Washington last year. Mr. Sinha said the Enron imbroglio did not figure in any of his meetings here but the subject of foreign direct investment did. In fact, the Minister had brought it with Mr. O'Neill and explained the present situation. Mr. O'Neill was said to have been satisfied; and Mr. Sinha said the Enron problem was well understood here and the issue was not a dampener to foreign investment in India. Concern at violence against minorities In another development, the U.S. Commission on international religious freedom has flayed India - the BJP - for the "disturbing increase" in violence against religious minorities and called on the Bush administration to take steps to pressure New Delhi into pursuing those responsible for violent acts against religious minorities. "The violence is especially troubling because it has coincided with the increase in political influence at the national and in some places the State level of the Sangh Parivar, a collection of exclusivist Hindu nationalist groups of which the current ruling party, the Bharatiya Janata Party, is a part," the Commission said in the section on India. The Commission said its perception came from a number of sources including an extensive examination of the situation in India, testimony from Indians of various religious hues, experts, academics and through personal interviews of victimised groups. Its efforts to travel in an official capacity to India had been scuttled by the Government there, the Commission said. Apart from the friction between Muslims and Hindus and the contributing causes to these over the years, the Commission said, the violence against Christians increased "dramatically" in India since 1998. "Particularly troubling are the continued reports that religious institutions are being pointedly desecrated by militant groups, groups that several Christian leaders describe as associated with the Sangh Parivar," it said. Though the BJP-led Government was not directly implicated, many accused it of hesitating to prosecute persons or groups responsible, in the process building a climate where extremists believed violence against religious minorities would go unpunished. "Though the worst of the extremist groups do not have official power, they are closely aligned with those in power and are seen by human rights organisation to be deliberately encouraging an environment of increasing hostility towards religious minorities," the Commission said. It also mentioned the suggestion that the tension between the ruling BJP and members of the Sangh Parivar was partly behind the Government's reluctance to pursue the perpetrators of sectarian violence. It also made suggestions to the Bush administration on how to deal with India, first of them being that the administration "should persistently press India to pursue perpetrators of violence against religious groups." The Bush administration has been called upon to press New Delhi to oppose attempts to interfere with or prohibit ties between religious communities in India and any government efforts to regulate religious choice or conversion. The U.S. should pressure New Delhi to allow official visits from government agencies concerned with human rights, including religious freedom; and that New Delhi should also be asked to allow visits from non- governmental human rights organisations and groups concerned with religious freedom. The Commission also called on the U.S. to allocate funds from its foreign assistance programmes for the promotion of education on religious tolerance and inclusiveness in India. Neither State nor MSEB has defaulted on agreement with Enron 05/01/2001 Press Trust of India Limited © 2001 PTI Ltd. Mumbai, May 1 (PTI) Chief Minister ofthe western Indian state of Maharashtra Vilasrao Deshmukh Tuesday said neither the state government nor the state electricity board had "defaulted" on contractual agreements with Enron -promoted Dabhol Power Company (DPC) prompting the latter to slap a termination notice on the Maharashtra State Electricity Board (MSEB). "It will not be proper for the government to announce its public stance over the issue unless it gets to know something officially from Enron", Deshmukh said when his attention was drawn to the dispute between MSEB and Enron with both treatening to serve termination notices on each aother for breaking contractual agreements. The government was of the view that the Enron imbroglio must be resolved amicably through negotiations, the Chief Minister told reporters. Deshmukh said the energy review committee, headed by former bureaucrat Dr Madhav Godbole, had been given powers to renegotiate the Power Purchase Agreement (PPA) between DPC and MSEB. The Godbole committee that reviewed the enery scenario in general and Enron deal in particular recently submitted its report to the state government. (THROUGH ASIA PULSE) 01-05 2001 Sanctions hurt US interests more than India: Sinha 05/01/2001 Press Trust of India Limited © 2001 PTI Ltd. Washington, May 1 (PTI) India Tuesday asserted that economic sanctions by the US hurt Washington more than New Delhi and said it would be in both countries' interest if Bush Administration lifted them "as quickly as possible". "Our views have been very clear. We have said right from day one that sanctions hurt the US interests more than they hurt Indian interests, and the fact that they are raising it with us is an indication of their, I think, keen desire to be able to do away with it as quickly as possible, Indian Finance Minister Yashwant Sinha told reporters here. After a meeting with his US counterpart, Treasury Secretary Paul O'Neill, Sinha said "it will be in the interest of both countries if the US could see its way to lifting sanctions with legislative approval." During the talks, he said surprisingly O'Neill himself mentioned the issue of sanctions imposed on India after the Pokhran nuclear tests in May 1998. Referring to the Enron issue, he said both Enron and the government of western Indian state of Maharashtra have agreed not to take precipitative action and "I personally feel there is no reason for us to think that because there is some problem with Enron it is going to act as a dampener to FDI (Foreign Direct Investment) in India." The Maharashtra Government has set up a negotiating team with a representative from the federal government to renegotiate the power purchase agreement with Enron. "We also agreed neither should take any precipitate action and that we should negotiate and find a negotiated solution to this problem," Sinha said. (THROUGH ASIA PULSE) 01-05 2001 Sinha confident US will lift sanctions in its own interest 05/01/2001 Press Trust of India Limited © 2001 PTI Ltd. T V Parasuram Washington, May 1 (PTI) Indian Finance Minister Yashwant Sinha has expressed confidence that the United States will lift the sanctions imposed on India following the May 1998 Pokhran nuclear explosions "as quickly as possible." Sinha said he told the US Treasury Secretary Paul O'Neill during their meeting that things were quite normal (despite the sanctions) in certain areas and "it will be in the interests of both countries if the US Administration could see its way to lifting sanctions with legislative approval." "Surprisingly he (O'Nell) himself mentioned the issue of sanctions," Sinha told reporters Monday. "Our (India's) views have been very clear. We have said right from day one that sanctions hurt US interests more than they hurt Indian interests, and the fact that they are raising it with us is an indication of their, I think, keen desire to be able to do away with it as quickly as possible," he said. The Indian Finance Minister said that he and O'Neill discussed issues concerning the US and India and pointed out that the 'Vision Statement signed by then-US President Bill Clinton and Indian Prime Minister Atal Bihari Vajpayee envisaged a Cabinet level forum to deal with economic and financial matters. The meeting with O'Neill showed a commitment and involvement of the present US Administration to India in a very substantial measure, Sinha said. He said that he had also extended an invitation to O'Neill to visit India later this year to attend the next meeting of the forum, adding the invitation was accepted. Sinha said the performance of Indian economy was recognised by the IMF and added that everyone was very confident that not only would India be able to maintain its growth but improve upon it. When asked what accounted for India's decision to welcome a new trade round now though it had been opposed by India and other developing countries at Seattle, Sinha said: "Our position has been that we are not against a new trade round, and we have reiterated that position here. The world community also feels that there should be a new trade round. "We have our point of view with regard to the agenda for the new trade round. I don't think we have diluted that stand or that position. There was a general feeling that a new trade round, if properly conducted and properly negotiated, could be of great help," he said. Pointing out that EU is reported to be spending 400 billion US dollar a year for agricultural subsidies, which is many times their total overseas development assistance, Sinha said if the agricultural market could be opened to exports from developing countries, including India, they would benefit greatly. "So there is a general feeling that a new trade round should take place but on the basis of an understanding about what the agenda and the outcome will be. That is something in regard to which developing countries will lay a very important role," he said. When asked that many people were of the view that the rupee may go down to 50 to the US dollar, Sinha said he had heard that "doomsday scenario" several times before for the last three years and it had not happened. "I don't think we have reason to be despondent on that score." On NRI investment in India, Sinha said India had a very positive outlook about NRI investment and he had already done a great deal to make it worthwhile for them to invest in India. Answering a query on the Enron issue, he said that no one had raised that (the issue) with him during his meetings with several ministers and multilaterals here, but the general issue of Foreign Direct Investment (FDI) came up during his meeting with O'Neill and "I myself took the opportunity to point out to him what was happening. "I explained to him that I had a meeting with the Chief Minister of Maharashtra (a western Indian state) a few days before I came here in which the Power Minister of the federal government also joined and we came to the conclusion...that the Maharashtra government would set up a negotiating team, which they have done now to renegotiate the power purchase agreement with Enron. "We agreed that we will nominate a Government of India representative on this negotiating team. We also agreed that neither of the two sides (Enron and Maharashtra) should take any precipitate action and that we should negotiate and find a negotiated solution to this problem," Sinha said. He said "I personally feel there is no reason for us to think that because there is some problem with Enron it is going to act as a dampener to FDI in India." Asked when would FDI in India reach the level in China, he said that the first thing that needed to be done was to implement the budget as soon as possible. (THROUGH ASIA PULSE) 01-05 2001 Sinha urges U.S., EU, Japan to boost growth 05/01/2001 AFX (AP) Copyright 2001 AFX News; Source: World Reporter (TM) Indian Finance Minister Yashwant Sinha said he is urging his U.S. Japan and EU counterparts to boost economic growth, as the global slowdown is having a detrimental impact on India and the developing world. Sinha said he told IMF's policy making committee, the International Monetary and Financial Committee, that the onus for reviving global growth is on the three leading economies. "I said there was a need for much greater proactive policies for improving growth rates, especially in the G3 economies (U.S., Japan, EU)," Sinha told reporters after the close of the IMF's Spring meetings, adding that "a slowdown in the world economy will have an impact on our exports because these are the markets which are our major markets for exports." But he said that the slowdown has not had as negative of an effect on India as it has had on other developing nations in Asia because the Indian economy is largely dependent on domestic demand. "[While] the slowdown in the world economy will also have some impact on India, it may not be as large as other East Asian countries." Sinha said his government will work to create an environment "where fresh investment becomes attractive," which he said would take place when the parliament passes his reform-oriented budget for 2001/02. It passed the lower house on Wednesday. "We'll have to encourage demand and to various measures which have been continuing from the past and which I have enumerated in this year's budget," he said, adding that "when demand picks up investment climate improves. Domestic investment will also take place and so will foreign investment." He said the dispute between Enron Corp and the government of Maharashtra state is not expected to cause foreign investors to think twice about investing in India. "I don't think because there is a problem with Enron it is necessarily going to act as a dampener to [foreign direct investment]," he said. Sinha said he raised the issue in an April 27 bilateral meeting with Treasury Secretary Paul O'Neill, who "appeared satisfied" with Sinha's suggestion that Enron and the Maharashtra government should hold negotiations to ensure the continuation of the 2 bln usd project, which Enron is on the verge scrapping. Sinha added that O'Neill accepted his invitation to visit New Delhi at an unspecified date later this year as part of bilateral cabinet level forum initiated under President Bill Clinton in 2000. And he said that O'Neill raised the issue of U.S. sanctions against India which have been in place since India conducted nuclear tests in May 1998. Sinha said that he did not raise the issue with O'Neill because "our views have been clear. Sanctions hurt U.S. interests more than they hurt India's interests." He said that O'Neill's raising of the issue demonstrated a willingness on the part of the Bush administration to move toward lifting the sanctions. cbd/tr U. Houston: U. Houston forum focuses on minority education 05/01/2001 U-Wire © 2001 Copyright U-Wire. All Rights Reserved. By Ken Fountain, The Daily Cougar (U. Houston) HOUSTON -- Increasing access to higher education for members of Houston's minority communities will be one of the most critical challenges facing the city's business and civic leaders, said a panel of such leaders at a forum held Monday on the University of Houston campus. "Who Will Lead?" was the topic of the discussion for the 2001 Elizabeth D. Rockwell Distinguished Leadership Forum, which was co-sponsored by the Bauer College of Business. Rockwell is a winner of the UH Distinguished Alumna Award and is an executive of CIBC Oppenheimer Corp. Demographic trends indicate that Texas -- and Houston -- will within a few years be comprised of a minority-majority population, meaning that the different minority groups combined will outnumber Caucasians. The speakers agreed that ensuring young people from those backgrounds gain the education necessary to enter the increasingly high-tech workforce is a matter of economic survival for the region. "There's nothing more important in our community right now," said Kenneth Lay, chairman of the board of Enron, the Houston-based natural gas supply company that Fortune magazine has named the World's Most Innovative Company for the last six years. "Some progress is being made. Some programs have been shown to be pretty effective," Lay said. "They have significantly increased the graduation rates (of minority members) from high school, the percentage going on to college, and the percentage getting out of college." Lay noted that less than 10 percent of Hispanics in Texas graduate from college. "That is a time bomb waiting to blow us all up, unless we solve that problem," he said, adding that a large number of Hispanics, particularly male, who drop out of high school eventually go to prison. "We spend about $30,000 a year keeping them in prison, but yet we can't spend maybe $2,000 or $3,000 a year trying to get them educated while they're in high school," he said. John Mendelsohn, president of the University of Texas M.D. Anderson Cancer Center, concurred. "I think it's very important that a city of this size have major university power to take the kids that do make it into college, and educate them and move them into the leadership roles, and join our workforce as leaders," Mendelsohn said. "I applaud (UH President) Art Smith's attempts to bring the University of Houston to a higher level," he added, in reference to the Smith administration's advocating of the Texas Legislature to create a Texas Excellence Fund. The fund would help the University achieve the status of a Tier I research university. "I think it's critically important for the fourth largest city in the United States to have a school like this join the jewel we have of Rice University, which is small and one of the very best in the world, but can't produce the number of well-educated youngsters that this public university can," Mendelsohn said. Joseph Pratt, a faculty member of the Bauer College of Business and executive director of the UH Scholars' Community, pointed out from the audience that the University has several such programs to encourage young people from minority communities to pursue higher education. The Scholars' Community is an on-campus program designed partially to increase retention of college students from underprivileged backgrounds. The other members of the panel were Ben Love, retired chairman and chief executive officer of Chase Bank of Texas, and Robert Smith III, senior vice president in charge of the Houston branch of the Federal Reserve Bank of Dallas. Prebon Yamane Hires Former RCN Executive to Run Bandwidth Unit 2001-05-01 18:34 (New York) Prebon Yamane Hires Former RCN Executive to Run Bandwidth Unit Jersey City, New Jersey, May 1 (Bloomberg) -- Prebon Yamane (USA) Inc., a derivatives brokerage, has hired a former RCN Corp. executive to run a new unit that will buy and sell space on fiber- optic networks used for phone and Internet services. Rajan Chopra, 49, a former president of new product development for Princeton, New Jersey-based telecommunications provider RCN, will be president of Prebon Bandwidth, which will provide access to high-speed communications systems. Trading companies such as Enron Corp. see broadband bandwidth as one of the most promising emerging commodity markets as businesses look for the cheapest ways to zip data, voices and images around the world. ``The potential of this market is huge,'' Chopra said in an interview, though he declined to say how big. Chopra was involved in derivatives trading and risk management at Chase Manhattan Bank before joining RCN in 1998. Potential customers will be wholesale users of data networks, such as International Business Machines Corp. or Citigroup Inc., and telecommunications companies looking to add bandwidth to their networks or lease excess carrying capacity, Chopra said. ``We try to understand their businesses, their risk management and trading needs,'' Chopra said. ``And we provide market intelligence and timely execution'' of transactions. Trading opportunities in bandwidth will increase as users shift from trans-continental routes to regional networks, similar to the electricity markets, Chopra said. ``The bandwidth market has many of the same attributes as the swaps market in its infancy, and holds the same exciting promise,'' said Sanjay Sathe, executive vice president for Prebon Bandwith, who was also previously involved in Chase Manhattan Bank's derivatives business. Prebon Yamane (USA) and Prebon Bandwith are divisions of Prebon Yamane Ltd., a London-based broker with operations in financial derivatives, foreign exchange, energy and metals. --Bruce Blythe in the Chicago newsroom (312) 692-3731, or bblythe@Bloomberg.net/ss Story Illustration: to see the number of registered customers accounts with broadband Internet access in Hong Kong, see {HKTEINTB <Index< GP <GO<}. -0- (STR) May/01/2001 21:48 GMT _ Enron's Lay Discusses India's Dabhol Power Project: Comment 2001-05-01 19:31 (New York) Houston, May 1 (Bloomberg) -- Enron Corp. Chairman Ken Lay discusses the company's Dabhol Power Co. project with investors at the company's annual shareholder meeting in Houston and answered questions about operations in a press conference later. India's Maharashtra State Electricity Board, which buys power from the plant, has refused to pay Enron bills of 3 billion rupees ($64 million). Enron has invoked credit guarantees by India's federal government to cover the nonpayment. Lay said Tuesday that Maharashtra State board, a quasi-governmental agency, is $48 million in arrears. On a possible sale: ``We're not in any discussions right now about selling the plant.'' On the Maharashtra State Electricity Board: ``They want the power, they just don't want to pay for it.'' On the strength of Enron's contracts: ``We have good, strong contracts that have been tested in the courts 29 to 30 times. I think we will work this problem through in a way that won't impair our investment. It's not going to be pretty, and there's going to be a lot of noise.'' On the impact of the turmoil on the project: ``It is impacting operations, but it's not too late to curtail any damage,'' Lay said, specifying construction work. ``We're not pulling anybody out of there right now.'' --Margot Habiby in Houston (214) 673-3834, or mhabiby@bloomberg.net, through the Princeton newsroom (609) 279- 4000/jac Story illustration: To compare Enron's share performance and earnings history with other members of its industry, please see {ENE US <Equity< RV <GO<}. -0- (STR) May/01/2001 22:22 GMT
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