OPINION, P8 ECONOMY, P2 ANIL AGARWAL Mining can create 20 mn jobs if we rethink our policies INTERNATIONAL, P12 EDITORIAL DUE PROCESS US PROBE Halving Air India debt helps sale, but labour issue could trip it; net worth floor also high Sunil Mehta-led PNB may seek review of LoU liability later Jes Staley-led Barclays to pay $2 bn to settle fraud claims NEW DELHI, FRIDAY, MARCH 30, 2018 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL.XLIV NO. 24, 68 PAGES, `5.00 (PATNA `6.00, RAIPUR `7.00) 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 `5,000-CRORE OFFER SHIFTING GEARS Toyota,Suzuki to make Vedanta wins bid for Electrosteel in India for each other MITHUN DASGUPTA Kolkata, March 29 Suzuki to produce Baleno, Brezza for Toyota, Toyota to supply Suzuki Corollas; manufacturing to begin by mid-2019 THE ENFORCEMENT Directorate (ED) on Thursday attached assets worth over `2,300 crore, including two dozen hotels and resorts, in connection with its moneylaundering probe in the Rose Valley Ponzi scam case, reports PTI. Officials said the agency issued a provisional order under the Prevention of Money Laundering Act, attaching 11 resorts, nine hotels and a few other such facilities, an about 200-acre plot and 414 land parcels across West Bengal. This is one of the biggest attachment orders issued by the ED under the PMLA. Special Features Be ready for lower returns on equity and bond Global uncertainties, volatility, broken market sentiment, long-term capital gains tax on equities and market consolidation may lower equity returns this year ■ Personal Finance, P11 THE RBI has imposed a penalty of `58.9 crore on ICICI Bank for violating its directions on direct sale of securities, reports PTI. ICICI Bank said the violation was "due to a genuine misunderstanding on the timing of the applicability of RBI's directions in this matter". Imposing the penalty, RBI said it was being done in exercise of powers vested in RBI under the Banking Regulation Act, 1949, after taking into account failure of the bank to adhere to the directions issued by central bank. PAGE 6 95 non-coal mines to go under the hammer in FY19 AS MANY as 95 non-coal mineral blocks may go under the hammer in 2018-19, in what could stimulate investments in the mining sector and potentially fetch mineral-rich states such as Chhattisgarh, Jharkhand and Odisha `3.5-4 lakh crore over a 50-year period, reports Surya Sarathi Ray in New Delhi. Following the amendment to the MMDR (Amendment) Act in 2015, which made allocation of mines via auctions mandatory, 33 mines have been successfully auctioned. PAGE 10 Tata Power board approves sale of defence biz at EV of `2,230 cr TATA POWER’S board has approved the sale of its defence business, Strategic Engineering Division, to Tata Advance Systems, a wholly owned arm of Tata Sons, at an enterprise value of `2,230 crore, reports fe Bureau in Mumbai. The decision is part of the firm's plan to monetise non-core assets and boost its balance sheet. The firm will receive `1,040 crore at the time of closing the deal and `1,190 crore on achieving certain milestones, subject to government and other approvals, it said. PAGE 6 the committee of creditors (CoC) asking it to meet at the earliest. The committee discussed Renaissance Steel’s objections to bids byTata Steel and Vedanta with regard to their eligibility under Section 29 (A) of the IBC. Theresolutionprofessional had received bids from Vedanta,EdelweissAlternative Asset Advisors, Tata Steel and Renaissance Steel in January this year. On July 21 last year, the NCLT had admitted State BankofIndia’s(SBI)insolvency petitionagainstKolkata-based Electrosteel Steels. The company, which owes lenders `11,309 crore, had been referred to the bankruptcy court under Section 7 of the IBCfollowinganudgefromthe Reserve Bank of India (RBI). The 270-day deadline for insolvency resolution process completionwill expire onApril 17. Earlier on Monday, the Kolkata bench of the NCLThad asked Electrosteel’s resolution professional (RP), Dhaivat Anjaria, a partner at PwC, to convene the CoC meet as early as possible. On March 20, the Kolkata benchoftheNCLThaddirected the RP to place all the objections of Renaissance Steel Low growth in education loans (%, y-o-y) Education loans 25 19 18 20 15 CoC hits pause as Dalmia, UltraTech keep at it MITHUN DASGUPTA & SHUBHRATANDON Kolkata/Mumbai, March 29 0 -5 19 19 17 8 6 2013 2 -2 2014 FE BUREAU New Delhi, March 29 THE GOVERNMENT’S DECISION to bear a higher burden on education loans is aimed at helping an estimated 1 million students over three years and it could reduce a regional disparity in such advances. However, unless targeted better, more education loans raise the prospect of higher bad debt with public-sector banks Maundy Thursday ritual Pope Francis leads the Chrism Mass, during which sacred oils are blessed, on Maundy Thursday at Saint Peter's Basilica at the Vatican on Thursday Home loans 17 2015 2016 2017 Source: CARE Ratings (PSBs) that together account for 95% of the market in this segment. The Cabinet onWednesday approved modifications of the CentralSectorInterestSubsidy Scheme — along with the continuation of the Credit Guarantee Fund for Education Loans Scheme — with an outlay of `6,600 crore for three years through 2019-20. Continued on Page 2 againstVedanta andTata Steel before the CoC for an “independent consideration” of the committee. This was after Abhishek Dalmia-led Renaissance Steel moved the tribunal asking it to prevent Anjaria from proceeding with further negotiationswithVedanta,the highest bidder, till the issue of eligibility of the Anil Agarwalled company and Tata Steel was determined. Renaissance Steel had alleged that resolution applicants Vedanta and Tata Steel were not eligible to bid for the Kolkata-based insolvent steel makerasperSection29Aofthe IBC. Inhisorder,justiceJinanKR hadsaid,“Acopyofthedecision takenbytheRPinrespectofeligibility of resolution applicant Tata Steel and Vedanta as per Section 29A, with supporting reasonsfortakingthedecisions is to be given to the applicant (Renaissance)withinthreedays ofdateofthisorderwithproper acknowledgement.” The next hearingofthecaseisscheduled on April 2 at the Kolkata NCLT, whenAnjaria is expected to file the progress report. ● BINANI CEMENT Continued on Page 2 More funds to help but focus needed 5 RBI imposes `59-crore fine on ICICI Bank over bond sale norms Alternative Asset Advisors, Tata Steel and Renaissance Steel bid for Electrosteel in January EDUCATION LOANS 10 QuickPicks ■ Vedanta, Edelweiss Rural wages FE BUREAU Little growth THE PACE OF RURALWAGE GROWTH, both for agricultural and non-agricultural sectors and for most of the 25 occupations tracked by the Labour Bureau, has been on the decline on a year-on-year basis in the final months of 2017. Unless contained, the deceleration could worsen rural woes and hit consumption hard. ` ` ` 7 6 5 4 3 Rural average wages for men (% growth y-o-y, 2017) 6.38 5.41 5.0 5.02 Rose Valley: ED attaches over `2,300-cr assets produce up to 50,000 units annually forToyota. The deepening partnership between the two automakers will enable Suzuki to tap into Toyota’s R&D firepower to develop lower-emission vehicles and self-driving cars — areaswhich Suzuki has admitted it is struggling to keep up with. The two companies plan to introduce electric cars in India around 2020. Suzuki has dominated the Indian automobile market through a majority stake in Maruti Suzuki India, the country’s largest automaker, which sold roughly 1.6 million vehicles last year, accounting for every other car sold in the country.Producing 50,000 vehicles for Toyota would represent just a sliverof what Suzuki sold in India in 2017. Toyota lags far behind with a roughly 5% market share. signed next week 5.2 5.0 5.04 4.7 TOYOTA MOTOR AND Suzuki Motor agreed on Thursday to produce cars for each other in India as Toyota aims to increaseitsmarketshareinthe world’s fifth-largest passenger car market. The agreement follows an R&D tie-up announced by the two Japanese automakers a year ago, and will see Toyota, one of the world’s biggest automakers, secure production from its much smaller rival, which dominates India with its line-up of affordable compact cars. Suzuki will supply petrol and mild petrol-hybrid versions of its Baleno hatchback, along with the Vitara Brezza compact SUV to Toyota while the latter will produce petrol and petrol-hybrid Corolla sedans for Suzuki, the automakers said. Analysts said the arrangement would help Toyota expand its presence in India, where it has struggled to grow salesduetoleandemandforits lower-cost models. “India is a big blemish on Toyota’s otherwise strong track record for breaking into emerging markets,” said Janet Lewis,head ofAsia transportation research at Macquarie Securities. “By selling rebadged and slightly changed Balenos and Vitaras, Toyota can bolster its distribution network and move more towards expanding its market share.” Manufacturing will begin by mid-2019. Under the deal, vehiclesmadebySuzukiwillbe rebranded and renamed as Toyota cars, while the Toyota vehicles will sport the Suzuki badge. A Toyota spokeswoman declined to give details on production figures, while the Nikkei business daily reported that Toyota would supply around 10,000 vehicles to Suzuki, while Suzuki would ■ LoI expected to be 5.59 6.06 5.19 4.47 REUTERS Tokyo, March 29 ■ Objections of Renaissance Steel overruled by CoC 5.8 People look on as Isro's GSLV-F08, carrying the GSAT-6A communication satellite, blasts off from the Satish Dhawan Space Centre in Sriharikota on Thursday from the Kolkata NCLT 4.9 4.88 4.41 IN THE NEWS LENDERSTO ELECTROSTEEL Steels are understood to have selectedVedantaasthehighest bidder for the company at a meeting held onThursday.The Anil-Agarwal promoted Vedanta is believed to have made an offer of close to `5,000 crore for the bankrupt steel firm. A resolution for Electrosteel Steels is being worked out under the Insolvency and Bankruptcy Code (IBC). Sources familiar with the development said the objections from Renaissance Steel, which had questioned Vedanta’s eligibility to bid, had been overruled. The formalities are expected to be completed early next week. Electrosteel owes lenders close to `11,300 crore. ShouldVedanta finallytake control of the bankrupt Electrosteel,itwould be the second closure following Tata Steel’s winning bid forBhushan Steel. Thursday’smeetingfollows a nudge by the National Company Law Tribunal (NCLT) to ■ CoC met after a nudge Horticulture Oct Carpenter Nov Blacksmith Dec 2 1 0 Sowing Sep Source: Labour Bureau A MEETING OF the committee of creditors (CoC) for Binani Cement scheduled for Thursday did not take place. Meanwhile, Dalmia Bharat has written to the CoC reiterating lenders have already entered into a binding contract with it after it was found to be the highest bidder, sources told FE. A senior banker from a large public sector bank told FE that the CoC meeting would be held after a clear direction from the National Company Law Tribunal (NCLT) on the issue. On Tuesday, the Kolkata bench of the NCLT had told the CoC that in the larger interest of the creditors, it could consider the application by Binani Industries looking for an independent solution outside the insolvency process — its request to UltraTech Cement to take over its subsidiary Binani Cement. UltraTech had said on Wednesdaythat it received the Competition Commission of India (CCI) nod on its bid for Binani Cements, stating that theclearanceprovestheapprehension of the resolution professionalwas“unfounded”and that the company was “wrongly” and “unjustifiably” rated the second highest bidder. Continued on Page 2 APP-ER HAND How to weed out those seeking a free lunch in the age of GST SUMIT JHA New Delhi, March 29 THE FOOD BILL presented to this reporter at an Old Delhi restaurantlastweekmentioned a Goods and Services Tax Identification Number (GSTIN),but a free-to-download Android apphelpedmescanthebilland find the number to be fake. Obviously, the restaurant was collecting GST from the diners but was not depositing it with the government. The app, Peridot, developed by the GST suvidha provider (GSP) IRIS Business Services, enables a consumer to not only verifytheauthenticityofGSTIN on invoices but also access the last fewGSTreturns filed bythe businessentityshedealswith.In fact,theGooglePlayStoreshows over a dozen such apps developed by Lyra, Vishal Works, Madrecha Solutions and RP Developer,to name a few.However,these apps are notyetvery popular;eventhebest-performingonehaslessthan500downloads.Thefreeappdevelopedby Lyrahasanadditionalfacilityof identifying taxpayers even on the basis of oldVATnumbers. “Ifitturnsoutthatthebusinessyouhavebeendealingwith hasn’t deposited the tax collectedfromtheconsumer,then he or she can decline to pay the GST charged,” Gautam Mahanti,businessheadatIRIS, said. He added that the idea behind making this app availablefreeofcostwastoempower consumers and bring about transparency and accountability in businesses-to-business and business-to-consumer transactions. GSPs are IT companies selected by the GST Network — the IT backbone for GST — to use the application programming interface (API) providing by GSTN to build customised solutionsfortheirclients.These companies act as a bridge between taxpayers and the GSTN system. AlthoughGST-relatedinformation on any business can be accessed though a government site,www.gst.gov.in,theseapps provide a simpler and more handywayto do the same. Continued on Page 2