OPINION, P6 ECONOMY, P3 NEW INSTRUCTIONS Don’t shed tears for promoters who can’t bid for their firms Reservations can’t exceed 50%, so not clear what HardikCong alliance is about AWAITING EXTRADITION Piyush Goyal-led railway min relaxes vigilance inquiry norms for staff EDITORIAL COMPANIES, P5 Arthur Road jail to be Mallya’s home, India to tell UK court MUMBAI, MONDAY, NOVEMBER 27, 2017 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOLUME XXXXXV NO. 215, 16 PAGES, `6.00 P U B L I S H E D F R O M : A H M E D A B A D , B E N G A L U R U , C H A N D I G A R H , C H E N N A I , H Y D E R A B A D , K O C H I , K O L K ATA , L U C K N O W, M U M B A I , N E W D E L H I , P U N E FOOD PROCUREMENT ‘Peace clause suffices for now; to push Doha agenda’ Ahead of the World Trade Organization’s (WTO’s) ministerial in Argentina in December, commerce and industry minister Suresh Prabhu indicates while the country is willing to discuss a new issue like e-commerce and may even agree to an accelerated work programme on it,it doesn’t want such new subjects on the negotiating table until old matters,such as the DohaDevelopmentAgenda(DDA), are addressed. Prabhu wonders if the minimum support prices of cropshardlycovercosts,howothers can claim India is offering subsidies to farmers on procurement.In an interview to Banikinkar Pattanayak,the minister says India is very keen on having Apple here and if the iPhone maker submits a specific (and revised) proposaloninvestments,itwillbediscussed with MeitY, and adds that Alibaba hasn’t applied to DIPP for buying into BigBasket. “We have some advantage in services trade, which will grow faster than goods tradeinfutureandtheservicessector is very employment-intensive as well,” he observes.Excerpts: IN THE NEWS ONGC wants higher gas price for KG, Kutch STATE-OWNED Oil and Natural Gas Corp (ONGC) has sought more than doubling of natural gas prices to help bring significant discoveries in KG basin and Gulf of Kutch to production, reports PTI. Gas discoveries in shallow sea offAndhra Pradesh on the east, and off Gujarat on the west are economically unviable to produce at the current governmentmandated price of $2.89 per million British thermal unit, a senior company official said. The company wants a price of over $6 per mmBtu to help it produce the gas without suffering any losses. In the absence of a viable gas price, it will have to mothball the $1.5billion projects. “We have made representation to the government that the current price is not enough to make the discoveries viable,” he said. What will be India’s position on public stock-holding of foodgrain at the upcoming WTO ministerial in BuenosAires? We are very clear that our policies on public stock-holding are going to stay.We already have a perma- If the MSP offers no or only very little premium over costs of crop production, how are we giving huge farm subsidies? We are very keen to have Apple here. Let them come with specific proposals and they will be taken up with MeitY — SURESH PRABHU COMMERCE AND INDUSTRY MINISTER nent peace clause. (This clause protectsIndia’sfoodprocurement programmesagainstpenalaction from WTO members in case subsidy ceilings are exceeded). If we get a better solution than this,we willofcoursebemorethanhappy to push for it.But until then,even with the current arrangement, ourpublicprocurementwon’tget affected at all,and we won’t com- promise on this issue either. India has been seeking DDA’s implementation at the earliest. What are the DDA issues that you’ll push forat BuenosAires? Wewantgreatermarketaccessfor developing countries in agriculture.WearealsoaskingtheUSand the developed world to reduce their massive trade-distorting BAR ON DEFAULTERS Special Features ‘No undue gains to foreign bidders’ Alexa lands on Indian soil to make our homes smarter Amazon’s cloud-based voice service—Alexa, the brain behind the company’s voicecontrolled speakers—will answer questions, play music, read the news and much more in an Indian accent now ■ eFE, P8 FE BUREAU New Delhi, November 26 Life insurance: Six sins that may ruin your family Insufficient life insurance cover and mismanagement of a life insurance contract can ruin the future of your dependents. Adequate cover alone ensures financial security to the family ■ Personal Finance, P9 QuickPicks Now, have UAN for provident fund before getting a job EVEN BEFORE securing a job, a prospective employee can now have an Aadhaar-linked universal account number (UAN), which is mandatory for depositing provident fund contributions and seeking withdrawal of deposits, reports Surya Sarathi Ray in New Delhi. Besides easing an employer’s burden, it will also sensitise the youth to the benefits of long-term savings and old-age financial security. P2 HAVING DEBARRED WILFUL defaulters from insolvency resolution process, the government expects heightened interest of foreign investors in stressed domestic companies under insolvencyresolution,but itwould ensure these firms indeed have the credentials to bid for the assets. The idea is to offset anyperceived undueadvantagetobiddersfrom other countries, where the conceptofwilfuldefaulterdoesn’texist,vis-à-vis domestic ones, a seniorgovernment official told FE. Another official said even if a foreign country doesn’t have the concept of wilful defaulter,it will still have enough checks and balances in place which a local companythere is mandated to follow. If a foreign companyis dulycomplying with the law of the land there, he said, there is no reason why it should not get the chance tobidforstressedcompanieshere if it fulfils the stipulated criteria. “In fact, their participation will only improve competition to acquire assets,” he added. However, if a foreign country doeshavetheconceptofwilfuldefaulters,bidders from that nation may be asked to submit certifi- FOOLPROOF ■ IPs and the creditors’ panel are best equipped to ensure foreign bidders comply with IBC spirit ■ If a foreign company is complying with the law of the land there, there is no reason why it should not get the chance to bid for stressed companies here cates citing bona-fides,he said. “The perception that domesticbidderscouldbediscriminated against vis-à-vis foreign ones,especially from those countries wherethereisnoconceptofwilful defaulters, is not based on logic. Even then,all necessarysteps will be taken to ensure the insolvency resolution eco-system moves in a transparent, professional and non-discriminatorymanner,”said the first official quoted above. The insolvency professionals and the committee of creditors are best equipped to ensure any foreign company that bids for stressed firms comply with the “spirit of the law”,that is preventingunscrupulousanddubiouselements from bidding forstressed assets,he said. VIEWERSHIP WAR Video OTT apps far outpace DTH players ANUSHREE BHATTACHARYYA New Delhi, November 26 WITH THE ENTRY of video OTT apps like Netflix,Amazon Prime and Hotstar in the last two years, the growth of direct-to-home (DTH) TV active subscribers has slowed down considerably as the former,apartfrombringingmore of international content, also packs it with the latest domestic content faster than the latter. This,coupled with the consumer getting more data at lesser price, courtesythe cut-throat competition among the telecom operators since the coming of Reliance Jio last year in September, has added to the growth of video OTTs via-a-vis DTH. For perspective, according to the April-June 2017 quarter data OTT active users Market share of DTH operators (in million) % share of active subscribers (m) 80 68 Hotstar Videocon D2H 20 (13.06) Airtel 21 (13.7) 60 45 40 JioPlay 20 Netflix Amazon Video 13 5 0 Aug'16 Dec'16 Aug'17 Tata Sky 23 (15) Dish TV 24 (15.67) Sun Direct 10 (6.53) Reliance 2 (1.3) Source: App Annie, Trai released by the Telecom Regulatory Authority of India (Trai), the DTH active subscriber base at 65.31 million grew by 7.9% on a year-on-year basis. The same in April-June 2016 had grown by 52%. In contrast, the video OTT user base of 16 players, which stood at 63 million in August 2016 rose to 164 million in August this year, a phenomenal growth of more than 160%. Ob- viously,thesharpgrowthinvideo OTTcomesonalowbasebutnevertheless points to a trend that as data gets cheaper and smartphoneandsmartTVspenetration grows, video OTTs may begin to be getting preferred more and more by consumers than DTHTVsubscription. “Apart from bundling of services, bundling of service with handsets is another reason behind consumers streaming content online.Forexample,manyof these apps now come pre-embedded in smartphones. Also post Jio’s entryin the market cost of data has gone down tremendously, so people have started streaming content online,” said Jehil Thakkar,partner,Deloitte. Continued on Page 2 farm subsidies to ensure a levelplaying field.They give subsidies in a clever manner. For instance, somecountriesoffersubsidiesfor notploughingtheland.Theideais if fields are kept vacant, prices of the commodity concerned won’t fall (as there’ll be a lid on production).Theseareindirectsubsidies. Continued on Page 2 Remembrance The second edition of Stories of Strength, recounting survivors’ accounts of their personal triumph over the 26/11 attacks, at Gateway of India, Sunday. AMIT CHAKRAVARTY PANAGARIYA’S ‘PLAN’ SHELVED Aayog adopts PM’s vision PRASANTA SAHU New Delhi, November 26 WHEN THE ERSTWHILE Planning Commission, which exercised great powers in Plan funds allocation to states, was abolished and replaced by NITI Aayog in January2015,most believed the era of planning was to be supplanted with renewed focus on execution of infrastructure and social-sector projects, with the Aayog playing the role of a think-tank and facilitator. However, the Plan was again makingaback-doorentryofsorts as the Aayog was asked by governmentinMay2016,toprepare a 15-year Vision, 7-year Strategy and a 3-year Action Agenda in placeoftheearlierFive-yearPlans (12th Plan between FY13-FY17 was the last one). Under former vice-chairman Arvind Panagariya,theAayogworkedonthese plans in right earnest and also brought out a document on the 3-year (2017-18 to 2019-20) Action Agenda. However, there is a twist again. Though there is no official announcement yet in this regard,thework on the 15-YearVision and 7-Year Strategy documents have been put in cold storage,sources told FE. Continued on Page 2
The Financial Express (FE) is a business paper that’s closest to the people who are in the business of business. From business policies to market trends to new developments, The Financial Express comes packed with incisive news on every relevant issue.