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Strategies & Market Trends : India Coffee House -- Ignore unavailable to you. Want to Upgrade?

To: Mohan Marette who wrote (471)	5/13/1998 7:50:00 AM
From: tom	Respond to of 12475

"Today? Two?" Quote from Chinese foreign ministry spokesman Zhu Bangzao on hearing that India had conducted too more tests today. The Pakistan foreign ministry gave a similar reaction. NEW DELHI, May 13 (Reuters) - India conducted two more underground nuclear tests on Wednesday in the western desert state of Rajasthan. Following is the text of the statement released by the Indian government: "In continuation of the planned programme of nuclear tests begun on the 11th of May, two more sub-kiloton nuclear tests were carried out at Pokhran range at 12.21 p.m. (0651 GMT) on the 13th of May, 1998. The tests have been carried out to generate additional data for improved computer simulation of designs and for attaining the capability to carry out subcritical experiments, if considered necessary. The tests were fully contained with no release of radioactivity into the atmosphere. This completes the planned series of tests. Government of India reiterates the offer to consider adhering to some of the undertakings in the CTBT (Comprehensive Test Ban Treaty) in the framework of the proposal in its statement of the 11th of May, 1998. And also BOMBAY, May 13 (Reuters) - The following are reactions from experts and analysts on India's second series of nuclear tests and the imposing of sanctions by the United States: --------------------- VED PRAKASH CHATURVEDI- HEAD OF RESEARCH AT SUN FOREIGN & COLONIAL ASSET MANAGEMENT "This leaves a bad taste in the mouth. The impression the new tests give is that India is trying to be defiant. Stocks have plummeted in a panic reaction. This move will not go well with international investors. As far as sanctions go, the new tests will ensure that the decision will be taken for those who were in two minds or waiting for a later date to impose sanctions." --------------------- L. LAKSHMAN, PRESIDENT, ASSOCIATED CHAMBERS OF COMMERCE AND INDUSTRY "I am as surprised at the second series as at the first one. We were hoping that after the first test, the government will provide clarification on benefits of the tests, costs and risks of retaliation and that explanation has not been forthcoming. We are confident that the intent is peaceful and the postures are defensive. In the short-term it may not have any great impact but in the medium and long-term, India will need to break the impasse with good diplomacy and explain to the world why they did this." --------------------- R. RAVIMOHAN, MANAGING DIRECTOR, CREDIT RATING INFORMATION SERVICES OF INDIA LTD <CRSL.BO> "This is playing up more than what one expected. It looks like this is a situation beyond analysis. There are two possibilities now. One is that these tests are all being done with the tacit understanding that once this is all through, India will sign the Comprehensive Test Ban Treaty (CTBT) and normality will be restored. Also, all this might be in the hope that it will establish some kind of military strength on the part of India and force the United States to accept modifications suggested by India to sign CTBT. The hope that I have is that the U.S. sanctions and Japanese halting of grant aid will be reversed when India signs the CTBT. If this is not going to happen, then the government will be pulling out the country from all bilateral aid from external agencies. And if they stop all aid, this will mean a very scary scenario." --------------------- R. BALAKRISHNAN, PRESIDENT, DIL VIKAS FINANCE lTD "I think the market is yet to digest the full impact ... probably wait and watch. Left to me I will sell now. Foreign hedge funds may pull out because they are short-term players but we do not know exactly what their exposure was. The budget (due on June 1) could be under pressure because the government would not be so comfortable to rely on grants and aid which normally form part of receipts. The rupee could depreciate if foreign inflows dwindle and debt repayments draw down reserves. What's important is to see whether the sanctions are a passing phase. Ultimately commercial interests will prevail. China has done more to anger world opinion but has the 'most favoured nation status' (by the United States)."