BOMBAY, 10 February — This has been a week of news on the Indian stock exchanges. The government sold its 25 percent equity stake in the overseas telecom carrier VSNL to the Tatas for Rs.14.39 billion or at the rate of Rs.202 per share. It also sold 33.6 percent equity stake in the oil marketing PSU, IBP to Indian Oil Corporation for Rs.11.54 billion or at the rate of Rs.1,551 per share.

This week, the government also announced a new drug policy which is expected to see at least 30 drugs move out of price control with 38 remaining under price restrictions.

The government also gave an ‘in principle’ approval for the complete decontrol of sugar in the next fiscal after futures trading in the commodity becomes operational.

Complete decontrol implies that the existing levy sugar system and quota release system would be abolished, paving the way for market-determined pricing of sugar.

Adding to the optimism was the Reserve Bank of India’s permission to foreign institutional investors (FIIs) to trade in the derivatives segment.

On Monday the BSE Sensex ended the day at 3,317.01. The selling pressure in tech and cement stocks negated the gains. Cement stocks had a mixed day. Gujarat Ambuja Cement was up and so was ACC as they reported a 48 percent and 29 percent increase in cement despatches for the January 2002 respectively. On the other hand, L&T and Grasim were down on reports of a reduction in the prices of cement.

On Tuesday the Sensex ended at 3,311.73. The biggest losers of the day were Reliance Petroleum and Reliance Industries after they failed to acquire the government stake in IBP and VSNL respectively.

The markets began to move up on Wednesday. The BSE Sensex closed at 3,427.39. The reforms helped boost the sentiments of the investors, including foreign ones, who now feel more confident about the Indian privatization program.

On Thursday the Sensex closed at 3,437. The surge in PSUs continued and this helped improve the sentiments further.

On Friday, the BSE closed at an eight-month high of 3,493.92.

Hindustan Lever , ITC, Reliance Industries, Hero Honda, Ranbaxy, Dr. Reddy’s and GlaxoSmithKline rose on sustained buying. On the other hand, public sector units (PSU) including refinery majors lost ground.

Gold was at Rs.4,970/- per 10 gms and silver was at Rs.7,550/- per Kg.

US dollar against Indian rupee was at Rs.48.60, pound sterling at Rs.68.75, Deutsche mark at Rs.22.18, euro at Rs.42.45, UAE dirham at Rs.13.23, Kuwaiti Dinar at Rs.157.78, Bahraini dinar at Rs.128.91, Saudi riyal at Rs.12.94, Qatari riyal at Rs.13.35 and Omani riyal at Rs.126.23.