OPINION, P8 M&M, P10 INTERNATIONAL, P16 FIRST TIME IN THREE YEARS WHITE HOUSE DISCIPLINE Signalling hardening interest rates, SBI hikes deposit rates Trump’s son-in-law Kushner loses access to top intelligence briefings EDITORIAL Jump in investment in the GDP data is quite hard to believe Satyapal Singh sullies India’s rich history in science by his talk on Darwin and Newton MUMBAI, THURSDAY, MARCH 1, 2018 VOLUME XXXXXV NO. 295, 20 PAGES, `6.00 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD 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 SENSEX: 34184.04 ▼ 162.35 NIFTY: 10492.85 ▼ 61.45 NIKKEI 225: 22068.24 ▼ 321.62 HANG SENG: 30844.72 ▼ 423.94 `/$: 65.18 ▼ 0.29 `/€: 79.66 ▲ 0.30 BRENT: $66.55 ▼ $0.08 GOLD: `30398.00 ▼ `98.00 SECTORALLY BROAD-BASED INX MEDIA CASE India again fastest growing With Q3 GDP at 7.2%, pips China to retake title; investments seem to power economy after a while IN THE NEWS Panel may scrap revenue deficit grants to states WITH A virtual mandate to revisit the 14th Finance Commission-awarded 10percentage-point increase in the Centre’s (guaranteed) tax devolution to states to 42% of the relevant divisible pool in the wake of its adverse impact on the Centre’s finances, the 15th commission for 2020-25 may exercise the option of doing away with post-devolution revenue deficit grants to states, reports fe Bureau in New Delhi. Another option before the commission is to suggest innovative ways to fund disaster management so that there’s an increased leeway for the Centre when it comes to providing disaster-related grantsin-aid to states. Currently, 11 states are receiving revenue deficit grants from the Centre as the 14th FC had felt the devolution it recommended may not suffice to cover their revenue gaps and gave them this extra succour. During 2015-20, these grants are estimated to be around `1.95 lakh crore — the budget for 2018-19 is `34,582 crore compared with `35,819 crore (RE) in 2017-18. Special Feature JBL Pulse 3 will rock the party Available for `15,999, the Pulse 3 speaker has built-in lighting effects and more powerful drivers for better sound ■ Gadgets, P15 QuickPicks `9k-crore arms procurement THE DEFENCE Acquisition Council (DAC) on Wednesday approved arms procurement, including that of 41,000 light machine guns and over 3.5 lakh close quarter battle carbines, worth over `9,000 crore under the buy-and-make-Indian category, reports fe Bureau in New Delhi. PAGE 2 Macquarie wins 9 NHAI projects PUTTING IN a `9,681.5-crore bid, Australian firm Macquarie has emerged the winner for the first bunch of 9 highway projects under the TOT model, reports fe Bureau in New Delhi. Macquarie’s bid is around 29% higher than the second-highest bid placed by Canada’s Brookfield and exceeds NHAI’s own expectations. PAGE 3 CBI arrests Chidambaram Jr Held at Chennai airport, flown to Delhi; arrested for ‘not cooperating with investigators’ FE BUREAU New Delhi, February 28 A DRAMATIC REBOUND in investments — a growth of 12% in gross fixed capital formation (GFCF) on a (revised) strong base of 8.7% could not have materialised without substantial private participation — helped the Indian economy to grow at a better-than-expected pace of 7.2% in the third quarter of this fiscal. Strong shows by manufacturing, agriculture and construction sectors and services that largely held GDP looks up 13 (% growth, y-o-y) 11 11.9 11 9 7 5 (% growth, y-o-y) 40 8.3 7.2 8.1 Q1 Investment jumps, pvt consumption falters 6.7 Q2 Q3 Q4 Q1 2016-17 GVA GDP Q2 Q3 2017-18 Nominal GDP 30 20 15.9 10 0 -10 8.3 5.6 6.1 Q1FY17 Note: GDP is equal to GVA plus indirect taxes minus output subsidies; Source: MoSPI ground have boosted growth. The Central Statistics Office (CSO) also revised the Q2FY18 GDP expansion to 6.5% from 6.3% earlier, and upped its advance estimate of the rate of GDP expansion for 2017-18 to 6.6% from 6.5% seen earlier. GFCF had last grown at faster pace in Q1 FY17, at 12 PFCE 15.9%, now revised from 7.4%. India regained its status as the world’s fastest-growing major economy in the third quarter, surpassing China’s growth after a gap of one year. The Chinese economy grew 6.8% in the October-December quarter. The pick-up in gross Q3FY18 GFCE GFCF domestic product (GDP) growth to the fastest pace in five quarters — which suggested the economy has completely recovered from the painsofdemonetisation—was despiteasignificantslowingof private consumption, the economy’s principal engine. Continued on Page 2 DEEPTIMAN TIWARY & ABHISHEK ANGAD New Delhi, February 28 KARTI CHIDAMBARAM, SON of senior Congress leader and formerfinance ministerPChidambaram,wasarrestedbythe Central Bureau of Investigation (CBI) on Wednesday in connection with its probe into the INX Media case. Flown to New Delhi fromChennaiairportwherehe was held shortly after he stepped off a flight from the UK,Karti was produced before a metropolitan magistrate who sent him to CBI custody for the night and directed PREDATORY PRICING Mittal to Trai: See you in court RISHI RANJAN KALA Barcelona, February 28 Final homage Fans gather during the funeral procession of actor Sridevi in Mumbai on Wednesday EXPRESS PHOTO: DILIP KAGDA SUNIL MITTAL, CHAIRMAN of the country’s largest telecom operator Bharti Airtel, said on Wednesday that the company has no choice but to challenge the Telecom Regulatory Authority of India’s (Trai) latest regulation on predatory pricing in a court of law. Speaking to FE on the sidelines of the MobileWorld Congress in Barcelona, Mittal said that they have a right to conduct business in a proper mannerwhich the latest regulation hinders, so they are left with no option. “I don’t think there is any otherchoice.Weheardviewsof one of the leading operator on the predatory pricing order, Aircel files for bankruptcy AIRCELONWednesdaysaid ithasfiledforbankruptcyas the company has been facing “troubled times” in a “highlyfinanciallystressed” industry,reportsPTI.Italso cited intense competition following the disruptive entryof a newplayer. Details on Page 6 Vodafone.Vittorio (Colao ) has made a very strong comment and we have heard Trai’s response. This order hinders operators’ ability to conduct business in an orderly manner and I cannot envisage anything other than a legal challenge,”Mittal said. “We believe we must have the right to conduct business in a proper manner. What we are saying is that we will agitate at the proper forum. We must be provided the right to conduct business in an orderly manner, which is enshrined in the Constitution,” he added. Continued on Page 2 Karti Chidambaram is escorted to the Patiala House Courts by the police in New Delhi on Wednesday that he be produced before the CBI court on Thursday. The CBI said Karti was arrested fornotcooperatingwithinvestigators. In May 2017, the CBI filed an FIR naming,among others, Karti and INX Media for alleged irregularities in clearance from the Foreign Investment Promotion Board (FIPB) to the media group for receiving overseas funds in 2007 when Chidambaram was Union finance minister. The CBI alleged that INX Media’s foreign direct investment (FDI) proposal was “deceitful and fallacious” but was still granted approval. Continued on Page 2 PMI FE BUREAU Manufacturing moderates India’s manufacturing sector activity fell to a four-month low in February as factory output and new business orders rose at a slower pace Manufacturing PMI Services PMI 55 53 52.1 49.6 51 49 47 45 51.7 46.8 Dec 2016 Jan ‘18 Feb 2018 Note: Reading below 50 suggests contraction and above it indicates expansion Source: Nikkei, IHS Markit
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