Home Loan Data

The government has asked state-owned lenders to submit data on home loans sanctioned by them since Dec 15, 2008, the day on which the public sector banks had announced lower interest rates on home loans up to Rs 20 lakh following government intervention to boost demand. Bankers acknowledge that despite a reduction in interest rates to 9.25 per cent for loans up to Rs 20 lakh and 8.5 per cent for home loans up to Rs 5 lakh, the response has been unenthusiastic. Interest rates under the package are fixed for five years and the loans come with a free property insurance cover. “The flow of home loans has not picked even after the special package as there is a perception that real estate prices will fall further. Banks have explained this to the finance ministry, but it has asked for fortnightly data,” said a senior executive at a public sector bank.

The plan for the quarterly meeting with bank chiefs has not been circulated; source said that it will include a review of credit flow and the status of implementation of the packages announced for boosting economic activity. The meeting comes days before the Parliament session and barely a month before the election process starts. The public sector banks have also been asked to submit the details of all incremental lending and borrowing activities, not only for recent months but for the last three years. “The meeting will analyse the cost of funds after the measures announced by the RBI over the last four months as the government is trying to push for another round of rate cut. So, they have asked for detailed data,” a bank executive said.

According to the latest data on sectoral credit deployment by banks released by the central bank on Monday, on a year-on-year basis the growth in the total flow of housing loans dropped to 8.8% at the end of Dec 19, 2008, from 13.9% at the end of Aug 2008. The year-on-year non-food gross bank credit growth also fell from 26.8% at the end of Aug 2008 to 24.8% in mid-December. But data also revealed that public sector banks have seen a 28.6 per cent rise in credit flow for the year up to Jan 2, 2009, as against 19.8% in the year up to Jan 4, 2008. In contrast, the growth in credit flow from private and foreign banks has dropped sharply despite demand shifting from equity and overseas markets to the Indian banking system.

Bricks

Brick, of course, is a modern building material. It is being used today everywhere in the world. But actually, brick is as old as the history of civilization! The Babylonians and Egyptians made and used bricks at least 3,000 years before the birth of Christ. Some excavations suggest that it was used even earlier.

The making of brick in early times was very crude. Brick is made if clay or shale and backed or burned at a high temperature. In early times, raw clay was used to make brick, but no machinery to make it had been invented. The clay was crushed and mixed with water by workmen who trampled it with their bare feet. Straw was mixed with the wet clay to hold the bricks together. The mixture was then formed by hand into different sizes and shapes and placed under the Sun to dry.

This crude method was followed by many years until it was discovered that burning the clay with fire made the bricks much harder and better able to withstand dampness. Straw was then no longer needed.

The Sun-backed bricks would have been useless in England, but in the hot, Middle-Eastern countries they proved to be so durable that some of the bricks used in ancient Babylonia can still be seen today.

Projects under vigilance scanner at Chandigarh

Controversial mega projects in Chandigarh worth billions of rupees under prevailing market prices are under the scanner of the Central Vigilance Commission (CVC). The CVC has sought all files pertaining to the mega-projects from the Chandigarh administration to investigate alleged corruption in land deals.

Using its powers as a court, the CVC has announced the setting up of a vigilance commission to probe the murky land deals worth billions of rupees. The probe will be a major embarrassment for the administration top brass as local NGOs have alleged irregularities and corruption in the land deals.

“We will comply with the orders of the CVC. All files will be sent for this probe,” a senior union territory (UT) official said.

The land deals, most of which have been concluded in the last three years, have generated much controversy with the city’s mayor and senior Congress leaders demanding that UT Administrator S.F. Rodrigues, who is also the Punjab governor, give up his post as the city’s administrative head until a probe into the deals by a central agency.

At the centre of the controversy are ambitious projects like the Film-city, the Medi-city, the Amusement-cum-Theme Park and the new phase of the Information Technology (IT) Park.

The administration has not only been accused of rushing in with some of the projects but also making allotments to certain big realty companies at prices much lower than the prevailing market rates for land in the 114-square km city, which is the joint capital of Punjab and Haryana but is a centrally-administered union territory.

The 73-acre Amusement-cum-Theme Park project has not got off the ground even couple of year after it was allotted to realty major Unitech as the administration failed to extend facilities on the land. Several rules were allegedly violated in giving concessions to the firm.

Some renowned companies, like Singapore’s famed Sentosa Island amusement park, were disqualified from bidding for this project.

In the Film-city project, realty major Parsvnath was allotted the 30-acre land in Sarangpur village of the union territory for Rs.191 crore. The company, which had deposited nearly Rs.480 million, is now seeking the money back with interest. It has excused itself on the ground that the land is not free from encumbrances.