Construction firms face ‘collapse risk’

Construction firms face ‘collapse risk’

Many of the 2,000 firms in DP Info’s study have high debt, little cash and weak profitability

By Joyce Teo

During the construction boom, many firms took up projects using short-term credit and now face the risk of defaulting on repayments if banks further tighten credit.
THE local construction industry could already be in serious trouble heading into the economic downturn, new data from DP Information Group (DP Info) shows.
Ironically, the seeds of the problem were sown during the recent construction boom as firms snapped up projects using short-term credit to get things moving.

As a result, many are heavily reliant on this short-term credit.

And they now face the risk of defaulting on repayments, should banks further tighten credit as times get tougher, the credit and business information firm said.

This finding was based on an analysis of the audited financial results of more than 2,000 construction firms lodged this year.

About three in four have an annual turnover of $10 million or less. The other 24 per cent are over $10 million.

Overall, about 6,000 firms make up the construction industry here.

The analysis of the data found that many companies face not just one but multiple financial problems.

These include: high levels of debt, low levels of liquidity and weak profitability.

All these are all tell-tale signs of pending financial trouble, said DP Info. Managing director Chen Yew Nah said: ‘The research is a warning sign for the construction industry and while it does not mean a large number of firms will fall, it does mean they are vulnerable to collapse if their position deteriorates.’

DP Info’s research showed that 45 per cent of the construction firms surveyed rely on short-term loans.

Of these firms, slightly more than half have debt levels that exceed the cash levels they have in the bank.

This means that 27 per cent of all construction firms surveyed are likely to face financial difficulties if their short-term credit is denied or if the repayment terms are shortened.

Construction firms also face weak levels of liquidity. Of those surveyed, 45 per cent had less than $100,000 in cash.

Of the firms relying on short-term loans, about 59 per cent of them with more than $100,000 in debt have less than $100,000 of cash at the bank.

A third weakness is profitability. About 35 per cent of construction firms reported net losses while 51 per cent have accumulated losses.

Many construction firms do not have strong balance sheets in any event, but during the boom in the past two years, they took on more projects using short-term loans, said Ms Chen.

‘The high level of dependence on short-term debt and the staggered pattern of receipts mean the construction industry will face difficulties if short-term credit dries up,’ she said.

Many financial institutions may be reluctant to renew or extend credit if project sales are slow.

If credit lines of constructions firms dry up, they may not be able to pay their sub-contractors or other firms promptly.

‘What is needed is a coordinated effort by the Government, the industry and financial institutions to respond to the unique problems faced by the construction industry,’ said Ms Chen.

For instance, an industry-specific response is required to ensure that the funds made available by the Government are best used.

The Government recently said it will help make available $2.3 billion worth of loans to help firms ride out the economic slowdown.

‘Bankers need to articulate clearly what are the products available to help the sector, for example,’ said Ms Chen.

Small construction firms are not likely to default as their debt exposure should not be extensive if their debt is related only to committed construction project works, said Singapore Contractors Association executive director Simon Lee.

Ms Chen said cash flow is emerging as a problem at some construction firms since they are not getting paid on time. ‘Once you’re in default, you have negative cash flow and are no longer a viable company,’ warned Ms Chen.

Some firms have folded because of negative cash flow, even if they still have business to do, she said.

The construction industry is just an example of an industry with unique needs. Other industries such as manufacturing and transport may also face problems due to their reliance on debt to finance assets and equipment.

Efforts to assist each industry can be better targeted if research identifies where the problems lie, said DP Info.

Source : Straits Times - 28 Nov 2008

Singapore Property - Buy, Sell, Rent, Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

They just fired shots all round -MUMBAI

They just fired shots all round -MUMBAI

Men with blazing guns and grenades barge into the Oberoi hotel

By Rupali Karekar & Nilanjana Sengupta

MUMBAI: Ms Mahek Mathur was enjoying a night out at a pub in the Oberoi-Trident hotels complex in Mumbai, when two men with backpacks barged into the hotel lobby with guns blazing.
They hurled hand grenades, killing the receptionist and a bellboy before turning their attention to the pub, she recounted.

‘They just fired all around, I saw at least three people drop down dead right before my eyes,’ Ms Mathur told The Straits Times.

She said one of the two gunmen ordered a member of the hotel staff to set a table on fire. When he refused, he was shot in the temple.

Ms Mathur, who managed to escape, was among the hundreds caught in the line of fire as terrorists struck across Mumbai on Wednesday night, leaving over 100 dead and over 300 wounded.

She and other eyewitnesses who spoke to The Straits Times said the events at the Oberoi happened with stunning swiftness with the entry of the two gunmen at around 10.40pm.

‘I was coming down the stairway towards the lobby, when the two men barged in,’ said an Oberoi employee who quickly sought refuge under the stairway.

But a female colleague at the reception desk was not so quick, and died instantly when she took a bullet in the chest.

Reports trickling in from the scene said the two gunmen who struck in the lobby were among a group of 10 who attacked the Oberoi on Wednesday night.

At press time, they were still holding several guests, mostly Westerners, hostage on the 18th storey.

Mr Alex Chamberlain, a British citizen who was dining at a different part of the hotel, told Sky News television that a gunman herded 30 to 40 people from the restaurant into a stairway and, speaking in Hindi, ordered everyone to put up their hands and to identify themselves.

‘They were talking about British and Americans specifically.’

He managed to slip away as the group was ordered upstairs by the gunman.

Most people in other parts of the hotel fled to their rooms. Some were guided to the basement area by staff members, where they remained for a while before escaping through the back door.

‘We had to poke our heads out of the door, and leg it,’ hotel guest Alan Jones, a media executive, told the BBC.

At around the same time, terrorists also targeted Cafe Leopold, a well-known hangout in Colaba in South Mumbai.

‘We were having dinner at a restaurant right opposite the cafe when we heard gunshots,’ Dr Akash Akinwar, a dentist, told The Straits Times.

He and his friend ducked under their table as did others around them. ‘No sooner did the restaurant owner pull down the shutters, than a barrage of bullets pierced through the steel,’ he said.

Cafe Leopold is a stone’s throw away from the Taj Mahal Palace Hotel - which also came under attack. Screams were heard and black smoke billowed from the century-old edifice on Mumbai’s waterfront. Firefighters sprayed water at the blaze and plucked people from balconies with extension ladders.

Being close to the Mumbai police headquarters and a police station did not deter the terrorists from attacking the Taj and Cafe Leopold. But help arrived fast as police personnel and ambulances rushed to the scene, according to Dr Akinwar, who said most of the injured were foreigners.

‘People were scared, and crying. We helped bundle most of the wounded into taxi cabs, which took them to the hospital,’ he said.

Meanwhile, over at the Chhatrapati Shivaji rail station in South Mumbai, a separate group of gunmen mowed down late night commuters waiting on its crowded terminal. Mr Nasim Inam was one of those who witnessed the rampage unleashed by four young men dressed in black T-shirts and jeans. ‘They just fired randomly at people and then ran away,’ he told the Associated Press.

Sobbing and shaking his head, he said he barely escaped with his life: ‘I was standing just behind. If they had turned around, it would have been me.’

Source : Straits Times - 28 Nov 2008

Singapore Property - Buy, Sell, Rent, Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

120 die in Mumbai carnage - India

120 die in Mumbai carnage - India

Terror attack on luxury hotels; dozens taken hostage; commandos prepare final assault

By Ravi Velloor, South Asia Bureau Chief

People ducking as gunshots are fired from inside the Taj hotel in Mumbai yesterday. Indian commandos and security personnel are still battling gun-toting militants who attacked several landmark sites across the city on Wednesday. — PHOTO: REUTERS

TERRORISTS barely out of their teens struck at 10 spots in Mumbai, some laughing as they peppered the lobbies of two luxury hotels with machine-gun fire and lobbed grenades at the main railway station of India’s biggest metropolis.
City police yesterday said the death toll had touched 120 and another 300 were being treated for injuries in city hospitals. Seven foreigners died, including a Japanese man and an Australian.

The terrorists had asked Americans and Britons to identify themselves, survivors said.

Among the dead were three senior policemen, including the head of the anti-terrorism squad. Dozens of people - including a Singaporean woman - were taken hostage. Most were released by last evening but the Singaporean and several others in the Oberoi-Trident Hotel were still reported to be inside it at press time.

At least one terrorist had been taken alive and seven were killed. Some eight others may be at the hotels and as many roaming free in the city.

The audacity of the coordinated attacks and the carefree attitude of the terrorists, who would have been aware that many of them would face certain death, raised parallels with the Sept 11, 2001 attacks on the United States. Mumbai has suffered at least seven terrorist strikes over the past 15 years, but none so severe.

The hostage-taking added a new element, observers said.

So much is India in shock that television news channels all but ignored the death in New Delhi of former prime minister V. P. Singh.

The leader who holds that office now, Dr Manmohan Singh, addressed the nation yesterday, vowing retribution for the terror attack and suggesting foreign involvement without accusing anyone in particular.

‘It is evident that the group which carried out these attacks was based outside the country and came with single-minded determination to create havoc,’ he said. ‘We will go after these individuals and organisations and make sure that every perpetrator and organiser of terror pays a heavy price for these cowardly acts.’

The attacks came as Pakistan’s foreign minister was in New Delhi. Mr Shah Mahmood Qureshi condemned the attacks, calling them ’shocking’. Even so, some damage to the bilateral relationship is inevitable, analysts said.

Arriving by boat after 9pm local time on Wednesday, the terrorists swarmed ashore, grabbing a police jeep and other vehicles along the way as they spread across the city.

They entered the luxury Taj Mahal and Oberoi-Trident hotels, the British-built Chhatrapati Shivaji rail station, a Jewish house of worship, the popular Leopold cafe and some hospitals.

Closed circuit cameras caught some of the attackers in designer T-shirts, carrying backpacks and rucksacks, moving confidently as they sprayed bullets.

One suicide bomber filled up a car with explosives and was headed for the airport when the vehicle blew up.

‘They seemed to know their way about the hotel, especially the back offices and kitchens,’ said Mr Ratan Tata, chairman of the Tata Group, which owns the Taj. The wife and three children of the Taj’s general manager were killed.

Yesterday, the firefight at the Taj had not ended late in the evening while some floors of The Oberoi, another hotel next to the Oberoi-Trident, was in flames.

At press time, gunfire continued to be heard as security officers conducted floor-by-floor sweeps of both hotels. It was not immediately clear how many hostages were freed in the commando operation or how many were still being held.

‘The television says they have the Taj under control but the terrorists are flinging grenades from the roof,’ said Mr Deep Bisen, a senior advertising executive who lives behind the Taj and had not stepped out of home because of a curfew.

Dozens of people, including a Singaporean woman staying at the luxury Oberoi-Trident Hotel, were held captive.

Late last night, commandos of the National Security Guard and the army stormed the 365-room Oberoi-Trident, where the Singaporean was being held.

They entered through the roof, occasional puffs of smoke at windows indicating they were working their way down floor by floor.

One of the hostages rescued was a five-year-old boy. Among the missing is a former top official at ABN Amro Bank in Singapore, who was dining at the hotel when the attack took place on Wednesday night. His wife, though, escaped.

‘The attackers were all between 17 and 20,’ a senior Indian security official told The Straits Times last night.

‘We believe they belong to the Pakistani terrorist group Lashkar-e-Toiba, which has shown renewed vigour in recent months. We had expected this attack but had no idea it would be this severe. Clearly, they had local support as well.’

A group calling itself the Deccan Mujahideen claimed responsibility for the outrage. The name suggested a South Indian linkage, but survivors of the scare said they had heard the attackers speaking in a mixture of Urdu and Punjabi, suggesting that they were actually from the northern part of the sub-continent.

The navy and coast guard had mounted a high-seas search for a vessel, the MV Alpha. They believe its crew could offer information on how many of the terrorists could come ashore aboard speedboats before launching their coordinated attacks across the city.

At press time, commandos of the army and National Security Guard were preparing their final assault on the hotels. And a nervous Mumbai was hoping that the terrorists still at large would be identified and nailed.

Source : Straits Times - 28 Nov 2008

Singapore Property - Buy, Sell, Rent, Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

Singapore URA releases reserve-list hotel site for application

Singapore URA releases reserve-list hotel site for application

Market watchers don’t see any takers until at least mid-’09

By KALPANA RASHIWALA

THE Urban Redevelopment Authority (URA) yesterday released for application through the reserve list a plum hotel site at Bukit Chermin flanked by Keppel Club and the Reflections at Keppel Bay condo project.

Despite the site’s attractive location in hilly terrain along the coast, some market watchers do not expect takers to emerge until mid-2009 at the earliest, given the grim property investment climate.

Any eventual bids for the 60-year-leasehold plot will be assessed under a dual-envelope system, taking into account concept and land price. The 3 ha plot is expected to yield about 50-70 hotel rooms/ villas.

The plot was initially on the second-half 2008 confirmed list but was moved to the reserve list late last month.

Jones Lang LaSalle Hotels executive vice-president Chee Hok said it is difficult to pin down the site’s value because of a combination of substantial construction costs expected for the project, the tight funding market and higher returns sought by potential investors given the current situation in the hotel business as operating profits trend down.

The site may be triggered for launch by investors towards second-half 2009, Ms Chee said. ‘At least business sentiment should be a lot clearer by then.’

Cushman & Wakefield Singapore’s managing director Donald Han also puts the earliest trigger date for the site at mid-2009. Hopefully by then, too, construction costs will have come down, which might also entice investors to apply for the site’s release, he said.

URA said: ‘The release of the site for a distinctive lifestyle hotel development will enhance the attractiveness of the Southern Waterfront and Southern Ridges.’

With panoramic views of Keppel Harbour, the plot, which has a maximum permissible gross floor area of 107,639 sq ft, is envisaged to be developed into a lifestyle hotel, URA said.

The site includes four pre-war black-and-white bungalows that are now leased for housing but will have to be restored and adapted for new uses by the successful tenderer. New buildings with panoramic views towards the harbour can be built, interspersed with the exiting bungalows, to create a unique development, URA said.

Developers interested in bidding for the site can make an application to URA accompanied by an undertaking to bid a minimum price. If this price is acceptable to the state, the plot will be launched for tender. Tenderers have to submit their concept proposals and bid prices in two separate envelopes. The concept proposals will first be evaluated against criteria including business and development concepts.

At the second stage, the price envelopes of proposals with acceptable concepts will be opened and the site will be awarded to the tenderer with the highest bid among those with acceptable concept proposals.

Source : Business Times - 28 Nov 2008

Singapore Property - Buy, Sell, Rent, Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

Commandos storm hotels to free hostages - MUMBAI

Commandos storm hotels to free hostages - MUMBAI

(MUMBAI) Elite Indian commandos fought room-to-room battles with Islamist militants inside two luxury hotels to save scores of people trapped or taken hostage after a concerted attack at more than 10 sites in Mumbai.

Seconds to safety: A guest looking out of a window of the luxury Taj Hotel in Mumbai before being rescued by Indian commandos yesterday
At least 104 people are dead - including an Australian, a Briton, an Italian, a German and a Japanese - and more than 300 wounded following blasts and random gunfire that started on Wednesday night.

Rescue efforts continued throughout the day yesterday amid sporadic gunfire, with some hostages escaping and others rescued by police. Several bodies were carried out of the five-star Taj Mahal Palace and Tower hotel, one of the sites seized by gunmen on Wednesday night.

India’s Prime Minister Manmohan Singh blamed militant groups based in India’s neighbours - usually meaning Pakistan - raising fears of renewed tension between the nuclear-armed rivals.

Helicopters buzzed overhead and crowds cheered as the commandos, their faces blackened, moved into the Oberoi Trident complex, where 20 to 30 people are thought to have been taken hostage and more than 100 others were trapped in their rooms.

‘There were people getting shot in the corridor. There was someone dead outside the bathroom. The next thing I knew I was running down the stairs and there were a couple of dead bodies across the stairs. It was chaos.’

- Australian actress Brooke Satchwell,
who starred in the Neighbours television soap opera, on how she narrowly escaped the gunmen by hiding in a hotel bathroom cupboard

Explosions rattled the nearby Taj Hotel, a 105-year-old city landmark on the waterfront, as the troops tried to flush out the militants there. Fire and smoke plumed from an open window.

According to witnesses, the attackers appeared to target British and Americans as they sought hostages in hotels and elsewhere.

Those who survived told harrowing stories of close encounters. Australian actress Brooke Satchwell, who starred in the Neighbours television soap opera, said she narrowly escaped the gunmen by hiding in a hotel bathroom cupboard.

‘There were people getting shot in the corridor. There was someone dead outside the bathroom,’ the shaken actress told Australian television. ‘The next thing I knew I was running down the stairs and there were a couple of dead bodies across the stairs. It was chaos.’

Commandos had also gathered outside a Jewish centre where a rabbi is thought to have been taken hostage, but later apparently decided to hold off from an assault.

A militant holed up at the centre phoned an Indian television channel to offer talks with the government for the release of hostages, but also to complain about abuses in Kashmir, over which India and Pakistan have fought two of their three wars.

‘Ask the government to talk to us and we will release the hostages,’ the man, identified by the India TV channel as Imran, said. A little-known Islamic militant group, Deccan Mujahideen, has claimed responsibility.

Around two dozen militants in their early 20s, armed with automatic rifles and grenades and carrying backpacks full of ammunition, came ashore in a rubber dinghy on Wednesday and fanned out across Mumbai’s financial and tourist heart. They commandeered a vehicle and sprayed passers-by with bullets, fired indiscriminately in a train station, hospitals and a popular tourist cafe. They also attacked two of the city’s poshest hotels packed with tourists and business executives.

Prime Minister Singh said New Delhi would ‘take up strongly’ the use of neighbours’ territory to launch attacks on India.

‘The well-planned and well-orchestrated attacks, probably with external linkages, were intended to create a sense of terror by choosing high-profile targets,’ he said in an address to the nation.

Condemnation and offers of help poured in from across the globe, including neighbouring Pakistan, which has called for India to wait for proof before accusing anyone of involvement. — Reuters, AFP, Bloomberg

Source : Business Times - 28 Nov 2008

Singapore Property - Buy, Sell, Rent, Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

Govt gets tough as Bangkok is isolated

Govt gets tough as Bangkok is isolated

Threat to use emergency powers as protesters seize second airport

By NISHA RAMCHANDANI

(SINGAPORE) Thai Prime Minister Somchai Wongsawat declared a state of emergency at two Bangkok airports besieged by anti-government protesters, a deputy minister said on Thursday, as rumours of an imminent army coup swirled through the capital.

Deputy Agriculture Minister Thirachai Sankaew said that police would be in charge of the Suvarnabhumi and the old Don Muang airports blockaded by the People’s Alliance for Democracy.

‘The cabinet agreed to use the emergency decree at the two airports to bring the situation back to normal,’ he told Reuters after a cabinet meeting.

This came after protesters, who had seized Suvarnabhumi International Airport earlier this week, took over Don Muang, effectively isolating Bangkok. This can only serve as another blow to Thailand’s tourism sector.

Thai Airways International announced that it was temporarily suspending all its 20 inbound and outbound flights from Don Muang until the airport resumes normal operations. The airline admitted that estimated losses from the closure of Bangkok’s two airports would be higher than the 500 million baht (S$21.4 million) a day it projected earlier.

Jetstar Asia, Tiger Airways and Cathay Pacific cancelled yesterday’s flights to and from Suvarnabhumi, as the political standoff showed no signs of abating.

Mr Somchai urged the army to stay in its barracks yesterday amid rumours of an imminent coup.

Government spokesman Nattawut Saikuar denied rumours that Mr Somchai planned to sack army chief Anupong Paochina a day after the general called for a snap election to defuse the country’s political crisis.

‘Troops should stay in their barracks and the prime minister is not going to sack anybody,’ Mr Nattawut said. Mr Somchai rejected calls to quit and held an urgent cabinet meeting in the northern city of Chiang Mai. He remains isolated from Bangkok, just as Bangkok is isolated from the rest of the world.

Jetstar Asia suspended flights to and from Bangkok today, while Tiger Airways had only done so for its morning flight at press time yesterday. Singapore Airlines has temporarily suspended all flights to and from Suvarnabhumi.

Meanwhile, freight operators such as TNT Express (Singapore) are putting into place contingencies to facilitate shipments.

TNT is ramping up capacity on its current TNT Asia Road Network - a road network which spans Singapore, Malaysia, Thailand, Indochina (including Vietnam) and China - to accommodate additional shipments affected by Suvarnabhumi’s closure.

‘We can easily scale our capacity to double or more, depending on demand,’ managing director Damien Tan said. Shipment travelling from Singapore to Bangkok would, on average, take two to three days.

TNT has been also getting queries from other industry players keen to tap its road network, and TNT is open to lending a helping hand. ‘Given the economic climate, we need to keep business going,’ Mr Tan said.

Meanwhile, the wave of leisure and business travellers cancelling Bangkok-bound bookings continues to gather steam.

‘Travel-wise, we will be a bit cautious,’ said Peter Lee, Hup Soon Global’s director of corporate finance and investor relations. Catalist listed Hup Soon - a distributor for automotive products and agriculture equipment - has an associate company and subsidiaries in Bangkok.

For Hup Soon, weakening investment sentiment right now is of a bigger worry than travelling. Plans to launch Hup Soon’s 52-unit luxury condominium project in downtown Bangkok this week have been postponed, due to the current level of investment sentiment.

A check with Chan Brothers Travel showed that 80 per cent of the 40 travellers - both leisure and corporate - who were headed for Bangkok this weekend have already cancelled their bookings. The remaining eight travellers are considering a re-route to nearby countries such as Malaysia, Cambodia or Vietnam, marketing communications executive Jane Chang said. — With Reuters reports

Source : Business Times - 28 Nov 2008

Singapore Property - Buy, Sell, Rent, Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

India’s business heart in crosshairs

India’s business heart in crosshairs

Mumbai terror strike kills many, halts market trading as financial sector tots up costs
By CONRAD TAN

(SINGAPORE) India’s financial markets were shut yesterday for the first time in more than three years after brazen terrorist attacks killed over 100 people and hurt hundreds more in Mumbai, the business capital of India.
 
On fire: The Taj Mahal Palace hotel in Mumbai after the attack on Wednesday night by terrorists armed with bombs and rifles 
Shares of big companies listed here with Indian operations slumped, dragging the Straits Times Index (STI) lower and defying a broad rally in stocks across most of Asia.

In Thailand, the baht weakened against other major currencies and stocks also fell after anti-government protesters forced the closure of Bangkok’s second airport, cutting off all commercial flights to the country’s capital.

But most regionwide financial market indicators, including indices tracking credit-default swap spreads - a measure of the risk of debt defaults by big companies or governments - showed a muted reaction to the worst terrorist atrocity in India since July 2006, when bombs on Mumbai trains killed more than 200 people and injured over 700 others.

Here, shares in SingTel, which owns significant equity stakes in the biggest Indian and Thai mobile phone companies, plunged 4.2 per cent yesterday, forcing the STI into a small loss of 0.04 per cent. SingTel said that it is closely monitoring developments in both countries.

DBS Group, which has six branches with some 450 staff in India, said that all employees at its Mumbai branch were safe and that operations at the branch were unaffected by the attacks. Its shares fell 1.4 per cent.

Most other equity indices in Asia rose, except in Thailand, where the main stock benchmark slid 1.4 per cent.

‘For now, markets haven’t really gone into a regionwide panic. If you look at the equity market action today, it does suggest most of the markets are trading on hope after China’s rate cut and positive sentiment spilling over from Wall Street,’ OCBC economist Selena Ling said. ‘That said, if this continues, people are going to get worried about potential contagion effects,’ she added.

Here, futures contracts based on India’s Nifty Index stock benchmark finished 2.3 per cent lower, after plunging 4.9 per cent earlier in the day.

Late Wednesday night, terrorists armed with bombs and rifles stormed Mumbai’s main railway station, hospitals and its biggest hotels - the Taj Mahal Palace and Trident-Oberoi - as well as a cafe popular with tourists.

Reports suggested that the terrorists had targeted foreigners, especially those holding American and British passports.

The Oberoi and Taj hotels are close to the financial district, which houses the offices of Merrill Lynch, Morgan Stanley and HSBC, Bloomberg reported.

One person BT spoke to here said that he knew colleagues who had been caught up in the attacks. ‘It’s a bit too close to home,’ he said, declining to comment further.

One Singaporean Chinese was being held hostage, Foreign Affairs Ministry spokesman Jai Sohan told reporters here last night. ‘We understand that she has not been harmed in any way.’ He added that the ministry was offering help to the family of the hostage and was in close touch with the Indian authorities to secure her release.

Another dozen Singaporeans were still stranded in several hotels last night, although they were not being held hostage and were in contact with Singapore’s consulate staff in Mumbai, Mr Sohan said. Many other people were also trapped in hotels in the vicinity of the attacks, Reuters reported, quoting an Indian official.

A group calling itself the Deccan Mujahideen - previously unknown - said that they were responsible for the attacks.

Analysts fear that the killings in Mumbai and the confrontation in Bangkok will hurt already fragile sentiment among investors worldwide, triggering a retreat from Indian and Thai investments. The Mumbai attacks ‘will have a huge negative impact on the financial sector because they targeted not just foreigners but also the professional class’, said Manu Bhaskaran, head of global economic research at US consulting firm Centennial, in Singapore.

‘It shows up the weaknesses in the Indian domestic intelligence and police procedures and set-up. That sounds very critical but I’m afraid that’s how investors will look at it.’

Still, the latest attacks won’t derail India’s growth, he said. ‘This would be devastating for a small country; it is something that India will absorb. I’m not worried about the longer term.’

OCBC’s Ms Ling said that the damage to Thailand would likely be more immediate than in India. ‘If you have a non-functioning airport and the Thai economy not doing that well in the first place, with the tourism sector being curtailed, 2009 growth will be increasingly at risk.’

Source : Business Times  - 28 Nov 2008

Singapore Property - Buy, Sell, Rent, Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com