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Karthick Dharman
Posted in: Yuvan's Best HitsSaturday, 28 May 2011
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Infosys To Counter Visa Misuse Charge In Us
BANGALORE: Gobal software major Infosys Technologies Ltd is reviewing its procedures to counter the charge of misusing B1 business visas to the US, a senior company official said on Wednesday.
"We are in the midst of internal review of procedures/processes to respond to a US court notice on business visas. We will also cooperate with the investigation into the issues raised by the US Department of Justice," Infosys co-chairman S Gopalakrishnan said.
Admitting that the company had received a subpoena (directive) on May 23 from a district court in Texas for appearance, Gapalakrishnan said it was not the first time the company was facing such a charge and expressed confidence of clearing its position.
"We are in the midst of internal review of procedures/processes to respond to a US court notice on business visas. We will also cooperate with the investigation into the issues raised by the US Department of Justice," Infosys co-chairman S Gopalakrishnan said.
Admitting that the company had received a subpoena (directive) on May 23 from a district court in Texas for appearance, Gapalakrishnan said it was not the first time the company was facing such a charge and expressed confidence of clearing its position.
"As we are a listed firm even in the US on Nasdaq, we have informed the SEC (Securities Exchange Commission) that we would soon submit our appropriate response to the court notice and the justice department," Gopalakrishnan affirmed.
One of its employees, Jack Palmer, in an Alabama court in February alleged that the company was sending low-level employees from India to the US to work in full-time posts at its customer sites against the immigration laws.
The US immigration authorities issue B1 visas for short-term visits to attend business seminars and restrict employees from engaging in gainful employment during their stay.
Though the $6-billion Indian IT bellwether did not yet receive summons directly from the justice department on the investigation it was carrying out on the visa violation charges, the company has decided to clarify its viewpoint to clear the air by informing the regulatory.
"Transparent and ethical way of conducting business being our hallmark, at no time have we violated state laws or procedures in any country. We have always gone by the rulebook and operated within the regulatory framework," a company official said, but declined to be named as he is not authorised to speak to media.
Declining to comment on reasons for ordering investigation into the company's use of B1 business visas, the official in the company's human resource department said since the tech meltdown in the aftermath of global recession, demand for US visas under various categories had slumped substantially.
"With increasing offshoring and outsourcing due to convergence of technologies and paradigm shift in business models, the Indian IT services sector has not been utilizing the full quota of visas, be it H-1B, L1 or B1," the official pointed out.
According to the May 23 disclosure made to the SEC, the parent company has about 10,000 of its software engineers on H-1B visas and 2200 on L1 working in the US.
Referring to the complaint lodged by its employee, the official said there was no such violation and had sufficient documentary evidence to allay the charges.
In the SEC filing, the company, however, agreed that any action by the US government against it in this regard would seriously affect its business in the North America market, which accounts for about 60 percent of its export revenue.
"In the event of the US government taking action, which limit the B1 business visa programme or other visa programme that we utilise, it will materially and adversely affect our business and results of operations," the company said in the filing.
In April, US Senator Charles E. Grassley submitted a letter to US Secretary of State Hillary Rodham Clinton and US cretary of Department of Homeland Security Janet Napolitano seeking an investigation into the use of the visa programme.
"I'm very concerned about fraudulent actions that at least one foreign-based company has allegedly been taking in order to get around the requirements and US worker protections of the H-1B visa programme," Grassley wrote in the letter, citing the complaint by Palmer against Infosys.
One of its employees, Jack Palmer, in an Alabama court in February alleged that the company was sending low-level employees from India to the US to work in full-time posts at its customer sites against the immigration laws.
The US immigration authorities issue B1 visas for short-term visits to attend business seminars and restrict employees from engaging in gainful employment during their stay.
Though the $6-billion Indian IT bellwether did not yet receive summons directly from the justice department on the investigation it was carrying out on the visa violation charges, the company has decided to clarify its viewpoint to clear the air by informing the regulatory.
"Transparent and ethical way of conducting business being our hallmark, at no time have we violated state laws or procedures in any country. We have always gone by the rulebook and operated within the regulatory framework," a company official said, but declined to be named as he is not authorised to speak to media.
Declining to comment on reasons for ordering investigation into the company's use of B1 business visas, the official in the company's human resource department said since the tech meltdown in the aftermath of global recession, demand for US visas under various categories had slumped substantially.
"With increasing offshoring and outsourcing due to convergence of technologies and paradigm shift in business models, the Indian IT services sector has not been utilizing the full quota of visas, be it H-1B, L1 or B1," the official pointed out.
According to the May 23 disclosure made to the SEC, the parent company has about 10,000 of its software engineers on H-1B visas and 2200 on L1 working in the US.
Referring to the complaint lodged by its employee, the official said there was no such violation and had sufficient documentary evidence to allay the charges.
In the SEC filing, the company, however, agreed that any action by the US government against it in this regard would seriously affect its business in the North America market, which accounts for about 60 percent of its export revenue.
"In the event of the US government taking action, which limit the B1 business visa programme or other visa programme that we utilise, it will materially and adversely affect our business and results of operations," the company said in the filing.
In April, US Senator Charles E. Grassley submitted a letter to US Secretary of State Hillary Rodham Clinton and US cretary of Department of Homeland Security Janet Napolitano seeking an investigation into the use of the visa programme.
"I'm very concerned about fraudulent actions that at least one foreign-based company has allegedly been taking in order to get around the requirements and US worker protections of the H-1B visa programme," Grassley wrote in the letter, citing the complaint by Palmer against Infosys.
Posted in: Breaking News
Tuesday, 24 May 2011
Looking For China Economy To Collapse? It’s Not Happening!
China’s economy is slowing down – and perhaps even faster than expected; but anyone looking for a collapse of the giant will be “sorely disappointed”.
That’s the message from Societe Generale economist Glenn Maguire, who heads the China economic analysis team at the French bank.
“The evidence has accumulated sufficiently enough for us to say that, whether causally or coincidentally, the Chinese economy is slowing in response to nine months of policy tightening,” notes Maguire.
How quickly the Chinese economy is slowing is, he reckons, the key question. And although it would take more data points to establish a trend, it appears to suggest that, if sustained, “the Chinese economy may be slowing at a faster pace than expected.”
But the high-speed China growth locomotive isn’t about to derail, adds Maguire. Although policymakers have been “somewhat heavy-handed” in slamming the brakes, “those looking for a spectacular slowing, if not collapse, in the Chinese economy will be sorely disappointed.”
In fact, a softening China growth trajectory remains consistent with current forecasts, notes Maguire.
This narrative challenges other uber-bearish assessments of China’s economy, and should offer some comfort for global asset markets that were unnerved by a particularly low reading of China’s Purchasing Managers Index (PMI) on Monday that pointed to a sharper-than-anticipated slowdown.
The PMI is a measure of the heartbeat of the manufacturing economy. In China, the manufacturing sector accounts for about a third of the overall economy. Even the entire industrial sector — including manufacturing and construction – accounts for less than half of China’s GDP. It’s possible, reason the analysts, for China’s economy to grow even when the manufacturing sector slows down a tick.
Then again, in China, it is folly to ignore the government’s response to the economic situation, the analysts reason. “At the moment, most of the slowdown is due to governments’ policy. And a hardlanding is certainly not something that the government would want to see.” In their estimation, if growth momentum does become a concern, the government will not choose to keep tightening.
What about China’s ghost cities?
The other area of concern about China’s economy that’s received a lot of attention relates to China’s property sector. Media reports speak of ghost cities – that is, enormous construction projects that remain totally uninhabited or barely occupied. [See satellite images of one such here – and two videos here (from November 2009) and here (from more recently).]
Legendary hedge fund investor Jim Chanos pointed to these trends, and flagged the risk that China was a “Dubai times 1,000.”
But others are not so convinced.
The first few lines in a new report from the Economist Intelligence Unit (accessible here, with free registration) address this concern head on:
“China is not facing a major housing bubble, although there could be a short-term mild correction.The Economist Intelligence Unit’s new models of population and incomes in China’s cities point to strong underlying demand for housing throughout the next decade. They indicate that housing demand in China is growing so quickly that a correction in the next couple of years will be short-lived.”
It then marshalls some head-spinning statistics to embellish its claim. Indicatively:
At current rates of construction, China can build a city the size of Rome in only two weeks.
In the decade leading up to 2010, China built houses equivalent to roughly twice the total number of houses currently in Spain or the UK, or about the same number as Japan’s current total housing stock.
And in the next decade, China’s urban population is expected to increase by 26.1% or over 160 million people.
Using the Chinese fixed asset investment measure, EIU expects a total of 75 trillion renminbi (or about $11.5 trillion at today’s exchange rates) to be spent on real estate investment over the next decade.
The report also offers an interesting explanation for China’s love affair with property, which is rooted in the country’s gender imbalance. Check it out…
That’s the message from Societe Generale economist Glenn Maguire, who heads the China economic analysis team at the French bank.
“The evidence has accumulated sufficiently enough for us to say that, whether causally or coincidentally, the Chinese economy is slowing in response to nine months of policy tightening,” notes Maguire.
How quickly the Chinese economy is slowing is, he reckons, the key question. And although it would take more data points to establish a trend, it appears to suggest that, if sustained, “the Chinese economy may be slowing at a faster pace than expected.”
But the high-speed China growth locomotive isn’t about to derail, adds Maguire. Although policymakers have been “somewhat heavy-handed” in slamming the brakes, “those looking for a spectacular slowing, if not collapse, in the Chinese economy will be sorely disappointed.”
In fact, a softening China growth trajectory remains consistent with current forecasts, notes Maguire.
This narrative challenges other uber-bearish assessments of China’s economy, and should offer some comfort for global asset markets that were unnerved by a particularly low reading of China’s Purchasing Managers Index (PMI) on Monday that pointed to a sharper-than-anticipated slowdown.
The PMI is a measure of the heartbeat of the manufacturing economy. In China, the manufacturing sector accounts for about a third of the overall economy. Even the entire industrial sector — including manufacturing and construction – accounts for less than half of China’s GDP. It’s possible, reason the analysts, for China’s economy to grow even when the manufacturing sector slows down a tick.
Then again, in China, it is folly to ignore the government’s response to the economic situation, the analysts reason. “At the moment, most of the slowdown is due to governments’ policy. And a hardlanding is certainly not something that the government would want to see.” In their estimation, if growth momentum does become a concern, the government will not choose to keep tightening.
What about China’s ghost cities?
The other area of concern about China’s economy that’s received a lot of attention relates to China’s property sector. Media reports speak of ghost cities – that is, enormous construction projects that remain totally uninhabited or barely occupied. [See satellite images of one such here – and two videos here (from November 2009) and here (from more recently).]
Legendary hedge fund investor Jim Chanos pointed to these trends, and flagged the risk that China was a “Dubai times 1,000.”
But others are not so convinced.
The first few lines in a new report from the Economist Intelligence Unit (accessible here, with free registration) address this concern head on:
“China is not facing a major housing bubble, although there could be a short-term mild correction.The Economist Intelligence Unit’s new models of population and incomes in China’s cities point to strong underlying demand for housing throughout the next decade. They indicate that housing demand in China is growing so quickly that a correction in the next couple of years will be short-lived.”
It then marshalls some head-spinning statistics to embellish its claim. Indicatively:
At current rates of construction, China can build a city the size of Rome in only two weeks.
In the decade leading up to 2010, China built houses equivalent to roughly twice the total number of houses currently in Spain or the UK, or about the same number as Japan’s current total housing stock.
And in the next decade, China’s urban population is expected to increase by 26.1% or over 160 million people.
Using the Chinese fixed asset investment measure, EIU expects a total of 75 trillion renminbi (or about $11.5 trillion at today’s exchange rates) to be spent on real estate investment over the next decade.
The report also offers an interesting explanation for China’s love affair with property, which is rooted in the country’s gender imbalance. Check it out…
Posted in: Breaking News
Duty Cut On Crude Products May Hit Tax Mop-Up: Revenue Secy
Government is concerned over meeting its FY11 tax collection target given the high inflation and a possibility of restructuring duties on petroleum products.
In a clear indication of the revenue department's stand, Revenue Secretary Sunil Mitra said that the government would not be able to meet its tax collection targets if petroleum duty restructuring takes place, reports CNBC-TV18 quoting sources.
Mitra said, “From present indications, it seems likely that inflation driven by international commodity prices is likely to be a major anxiety this year. A further tightening of monetary policy in response can impact the growth of corporate income, which may result in growth slowdown of corporate tax collections.”
“Inflation can also affect domestic demand and thereby adversely affect GDP growth, tax collections, etc. A direct factor of anxiety is increasing international prices of crude. Any rollback of customs duty on crude or of excise duty on petroleum products will significantly impact indirect tax collections as well.”
In a clear indication of the revenue department's stand, Revenue Secretary Sunil Mitra said that the government would not be able to meet its tax collection targets if petroleum duty restructuring takes place, reports CNBC-TV18 quoting sources.
Mitra said, “From present indications, it seems likely that inflation driven by international commodity prices is likely to be a major anxiety this year. A further tightening of monetary policy in response can impact the growth of corporate income, which may result in growth slowdown of corporate tax collections.”
“Inflation can also affect domestic demand and thereby adversely affect GDP growth, tax collections, etc. A direct factor of anxiety is increasing international prices of crude. Any rollback of customs duty on crude or of excise duty on petroleum products will significantly impact indirect tax collections as well.”
Posted in: Breaking News
Cbi Finds No Proof Of Offence By Aircel In 2g Probe
In the high profile 2G scam, the Central Bureau of Investigation (CBI) has not found any evidence against Aircel, under C Sivasankaran and the NRI entrepreneur and feels that the company might have been victimized. (Don't miss: Aircel gets notice over network roll-out)
CNBC-TV18's Malvika Jain reports on whether Aircel and Sivasankaran have been given clean chit.
The allegation is that C Sivasankaran might have been pressurised to sell his stake to Maxix Communications (owner of Aircel) controlled by T Ananda Krishnan.
Right now it would be inappropriate to say that a clean chit has been given because the grant of licenses from 2001 to 2007 is something that the CBI is going to start looking at once it has filed its third chargesheet, which is likely to happen by June 30. This (2001-2007 cases) investigation would take close to two months.
One of the CBI's investigating team is currently in Mauritius and is talking to the attorney general there and the other team in Delhi is questioning IP Khaitan of Loop Telecom. The team in Mauritius will return next week.
CNBC-TV18's Malvika Jain reports on whether Aircel and Sivasankaran have been given clean chit.
The allegation is that C Sivasankaran might have been pressurised to sell his stake to Maxix Communications (owner of Aircel) controlled by T Ananda Krishnan.
Right now it would be inappropriate to say that a clean chit has been given because the grant of licenses from 2001 to 2007 is something that the CBI is going to start looking at once it has filed its third chargesheet, which is likely to happen by June 30. This (2001-2007 cases) investigation would take close to two months.
One of the CBI's investigating team is currently in Mauritius and is talking to the attorney general there and the other team in Delhi is questioning IP Khaitan of Loop Telecom. The team in Mauritius will return next week.
Posted in: Breaking News
