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

To: Lee who wrote (521)	5/13/1998 1:02:00 PM
From: tom	Respond to of 12475

LONDON, May 13 (Reuters) - Foreign companies with business interests in India reacted cautiously to the imposition of U.S. sanctions on India on Wednesday after this week's nuclear tests. "We don't know as yet the specific components of the sanctions and to what it would extend. We are assessing the situation," Diane Bazelies, spokeswoman for Enron Corporation <ENE.N>, told Reuters after President Bill Clinton announced the sanctions. Enron is developing a 2,000 megawatt power station in Maharashtra state. Clinton, visiting Berlin on his way to the G-8 summit, signed documents imposing the sanctions on India which would bar U.S. banks from granting loans to New Delhi and block any aid from multilateral agencies like the World Bank and International Monetary Fund. Most business groups like Enron preferred to wait for further details on what the sanctions meant. Ford Motor Company <F.N> said it was keeping close contact with its employees in India and was monitoring developments. "We make civilian-use products and do not appear to be affected by the sanctions announced by President Clinton," said Ford spokesman Tom Hoyt. General Motors Corp <GM.N> said it was trying to determine the exact language of the sanctions. "For the time being the U.S. action does not mean much for us but we would like to see what the British government does," said a spokesman of Rolls-Royce Plc <RR.L>. British Prime Minister Tony Blair said India's nuclear tests carried out on Monday and Wednesday were "deeply disturbing", but his spokesman said Britain would not impose sanctions. "I don't think any big company that has invested so far would slow down his investments immediately, India is still a big and safe market. One would like to see its long-term effect," an emerging market analyst with Citibank said. However, analysts say, if the U.S. sanctions extend to exports out of India it could hurt its $1.3 billion software exports, the bulk of which is developed at its own 'Silicon Valley', the southern city of Bangalore. Computer maker IBM <IBM.N>, operating through its joint venture with the Tata group, said it was too early to assess the impact but said it would "comply with any restrictions". An official of ratings agency Standard & Poor said it was unlikely that the United States would immediately do anything to directly hurt the business interests of its major companies. The United States is the biggest investor in India. "Against this background I don't see anything hasty happening," said Rajat Kohli, an analyst with Paribas.