BAE Systems chief sees encouraging outlook for Typhoon orders in Middle East

BAE Systems sees an "encouraging" outlook for Typhoon orders from the region despite slowing overall production of the fighter. (Reuters)
Updated 22 February 2018
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BAE Systems chief sees encouraging outlook for Typhoon orders in Middle East

LONDON: The chief of Britain's biggest defense company said he was encouraged by the outlook for orders of the Typhoon fighter jet in the Middle East.
But BAE Systems forecast flat earnings overall in 2018 as it adjusted to lower production of the aircraft.
“The opportunity pipeline - in terms of campaigns in Europe and in the Middle East is as good as we’ve seen it,” BAE Systems’ CEO Charles Woodburn said
in a webcast following the announcement of the UK-headquartered company’s annual results.
“It certainly encourages us we will see growth coming into the next decade in Typhoon production,” he said.
His comments come as Typhoon production has slowed, at the cost of jobs, with the company announcing last October it would make nearly 2000 job cuts, due in part to a lack of jet orders.
BAE’s earnings statement released on Feb. 22 said that overall sales of airborne vehicles is expected to be 5 percent lower due to the completion of Typhoon contracts with Europe, Saudi Arabia and Oman.
Last year, the first eight Typhoon and all eight Hawk aircraft for Oman were delivered. The four remaining Typhoon aircraft are due to be delivered this year.
Typhoon support service packages are now helping deliver more revenue than aircraft production, and this is an area that is expected to grow, said Woodburn.
However, he said he expected Typhoon production will start to stabilize in coming years, particularly due to the confirmed £5 billion contract with Qatar, secured last December, to supply 24 Typhoon aircraft.
“We continue to pursue further export opportunities which if secured would drive growth back,” he said in his presentation.
Woodburn’s optimism could revive hopes in the industry that there might be progress on the much-anticipated, but yet to materialize deal to sell 48 Typhoons to Saudi Arabia.
Saudi Arabia accounted for 16 percent of BAE Systems’ total sales last year, with the US remaining the company’s biggest market accounting for 39 percent of sales.
Overall, BAE Systems’ sales were up by £0.6 billion to reach £19.6 billion in 2017. Operating profit decreased to £1.48 billion from £1.74 billion recorded in 2016.
“With an improving outlook for defence budgets in a number of our markets, we are well placed to generate good returns for shareholders,” Woodburn said in an official statement. 

The company decided on a final dividend of 13 pence per share, making a total of 21.8 pence per share for the year, marking an increase on 2 percent on 2016.


India names Modi demonetization backer as cenbank head

Visitors are seen standing next to a logo of the Reserve Bank of India (RBI) at the bank's head office in Mumbai on December 5, 2018. (AFP)
Updated 12 December 2018
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India names Modi demonetization backer as cenbank head

  • Das — a high-profile backer of Modi’s controversial 2016 move to scrap high-value currency notes, known as demonetization

MUMBAI: Ex-finance ministry official Shaktikanta Das took charge of the Reserve Bank of India on Tuesday, in a swift appointment expected to ease a dispute with the government as it pushes for looser credit rules ahead of a general election.
The announcement by Prime Minister Narendra Modi’s administration came just a day after Urjit Patel resigned from the post, following months of clashes between the two institutions over lending curbs and how to deploy the central bank’s surplus reserves.
Pressure on the RBI to take immediate steps to boost the economy, including a transfer of the excess reserves to the government, could well rise after Modi’s ruling Bharatiya Janata Party (BJP) suffered likely election losses in three key states on Tuesday.
Das — a high-profile backer of Modi’s controversial 2016 move to scrap high-value currency notes, known as demonetization — will serve a three-year term as governor, effective immediately.
RBI watchers said they expected the 61-year-old, who retired last year as secretary of the department of economic affairs having previously served on the RBI’s board, to put relations between the Mumbai-based bank and the finance ministry in New Delhi on a stabler footing.
Investors will also look closely at his ability to hold up against outside influences after recent efforts by the Modi government to gain greater control over the central bank’s regulatory powers.
“The incoming governor will have to work hard to prove that he has his own independent mind,” said Deepak Jasani, head of retail research at Hdfc Securities.
Investors said any openly political appointee with little macro-economic experience, would not sit well with financial markets that already sold off following the BJP’s election setbacks.
But Ashish Vaidya, executive director and head of trading at DBS Bank in Mumbai, said he expected India’s debt and currency markets to react positively.
“He is a bureaucrat...We expect the RBI to take a pragmatic approach under him, be pro-growth and change its stance going ahead given that inflation has come off sharply,” he said.
Finance Minister Arun Jaitley told Reuters partner ANI that the government acknowledged the bank’s independence.
“Government will fully support the RBI and coordinate with it in areas where consultations of government are required to make sure India’s economy benefits from both government policy decisions and areas which fall within domain of the RBI,” ANI tweeted, quoting Jaitley.

SWIFT APPOINTMENT
Pronab Sen, India’s former chief statistician, said he was surprised by the speed of Das’s appointment.
“If you have a situation where a position as important as the governor of the RBI is filled within 24 hours of the resignation of the incumbent, that will raise eyebrows,” Sen told Reuters.
“People are going to say, clearly this guy had already been identified. And, the situation was created where Urjit Patel had to quit.”
Das — widely seen as a contender for the top RBI job after Raghuram Rajan’s term ended in 2016 — did not answer calls from Reuters to his mobile phone.
RBI officials who have worked with him closely said Das was likely to be more inclusive in the decision-making process than Patel.
“He has a balanced approach and is good at consensus building,” said a former deputy governor. .”..We have had our fair share of differences. But he has always been solution-centric rather than festering on those differences.”
Das worked in the finance ministry under both Modi’s government and the previous coalition led by the main opposition Congress party and was also involved in drafting the Insolvency and Bankruptcy code aimed at protecting small investors.
He came under fire for his pro-demonetization stance and was the most vocal bureaucrat at the time Modi withdrew the high-value bank notes to fight tax evasion.
Das last year criticized the methodology of global rating agencies and sought a sovereign rating upgrade for India.