OPINION, P8 M&M, P11 PSB PROBLEMS EDITORIAL Till gold bonds are liquid, they will remain a dud Cash crunch will be fixed soon, need to push DigitalPay to really lower cash-usage INTERNATIONAL, P14 ‘GOOD RELATIONSHIP’ Former Sebi chairman Damodaran blames demands from Delhi CIA director Pompeo visited N Korea, met leader Kim NEW DELHI, THURSDAY, APRIL 19, 2018 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL.XLIV NO. 41, 22 PAGES, `6.00 (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 SENSEX: 34,331.68 ▼ 63.38 NIFTY: 10,526.20 ▼ 22.50 NIKKEI 225: 22,158.20 ▲ 310.61 HANG SENG: 30,284.25 ▲ 221.50 `/$: 65.66 ▼ 0.02 `/€: 81.27 ▼ 0.04 BRENT: $72.89 ▲ $1.31 GOLD: `31,276.00 ▲ `177.00 IN THE NEWS BCCI should come under RTI Act: Law panel OBSERVING THAT the Board of Control for Cricket in India (BCCI) was a "limb of the state", the Law Commission on Wednesday recommended that it must be brought under the ambit of the RTI Act as it falls under the definition of a public authority and can’t escape public scrutiny, reports PTI. A report of the commission, while making the recommendation that the BCCI be made accountable though it is regarded as a "private body", also noted it has received "substantial financing" from appropriate governments. RBI’s currency chest more than adequate to bridge the shortfall SECOND ROUND CASH SHORTAGE Stocks snap nine-day winning streak THE MARKETS ended marginally lower on Wednesday after nine consecutive sessions of gains owing to a fag-end rush among investors to unwind bets amid sustained foreign fund outflows, reports PTI. The 30-share BSE Sensex shed 63 points to end at 34,331.68, while the broader NSE Nifty finished 22.50 points lower at 10,526.20. Participants were eager to take money off the table after the recent rally, even as the wider sentiment remains positive, brokers said. IHH said to ask for time before Fortis bid IHH HEALTHCARE has asked Fortis Healthcare for three weeks to complete due diligence ahead of making a potential binding offer, people with knowledge of the matter said, as the takeover battle for India’s second-largest hospital chain escalates, reports Bloomberg. IHH sent a letter to Fortis’ board on Monday with the due diligence request following its cash purchase proposal last week, the people said. Govt, banks up supplies FE BUREAU New Delhi, April 18 THE GOVERNMENT AND banks scrambled all machinery at their disposal on Wednesdayto step up supplies of cash in states that are witnessing a shortage, with the finance ministry directing banks to ensure adequate availability of bank notes in deficit areas within 24 hours. Analysts said the currency deficit—peggedbyoneanalyst at Rs 75,000 crore — reflected the inherent nature of India as a high-cash economy would take more time to change, despite the digitisation drive. An unusually high spurt in ATM withdrawals since the second half of last fiscal,partly due to stepped up economic activity, might have also caused the crunch,theyadded. But if the government managestoreleaseapartofthecurrency reserves with the Reserve Bank if India (RBI) — close to Rs 1.75 lakh crore — expeditiously, the shortfall PoS machine pull-out adds fuel to the shortage fire WITHDRAWAL SYMPTOMS ` 18.29 Currency in circulation by March 2018 ` (`lakh crore) 17.5 Currency with public as on March 31, 2018 19.4 ATM^ withdrawals up H2 over H1 (growth %) Required currency with the public as on March 31, 2018 12.2 8.2 FY18 FY12-FY16 (Based on GDP growth) 1.9 Currency gap (average) ^Higher economic activity could be a reason 1.2 Movement towards digital modes 0.7* Net shortfall of currency Easy to bridge the shortfall with `1.75 lakh crore (in RBI offices/chests) and stepped-up printing of `500 notes *The shortage looks graver due to low income velocity of currency with the public, which means money is not getting adequately circulated in the economy; Source: SBI Ecowrap couldbebridgedwithoutcausing much economic disruptions or hassles to the public. Given the gravity of the matter, however, the Prime Minister’s Office is learnt to be keeping a close vigil of the sit- ABG Shipyard: Notice calls for fresh bids under IBC uation,although finance ministryofficialsrejectedanycomparison of the current situation with the immediate aftermath of demonetisation. Continued on Page 2 Lenders feel bid from Liberty House lower than recovery if business is liquidated SHAMIK PAUL Mumbai, April 18 FIFTEEN BANKS, INCLUDING the country’s top three and 10 from south India, have scaled back their networks of point of sale (PoS) terminals in early 2018,reportsShritamaBosein Mumbai.While these lenders together operated 15.1 lakh machines at the end of December2017,byFebruary2018this fell to 14.75 lakh,Reserve Bank of India data show. This coincides with the ongoing cash crunch inAndhra Pradesh,Karnataka and Telangana,limiting payment options for citizens. Bankers confirm the pace of additions for PoS machines has slowedafterspikinginthewake of demonetisation. Ambuj Chandna,head,retail liabilities, Kotak Mahindra Bank, told reporters earlier this month banks were pulling out the machines. Given merchant acquisitions for digital payments is loss-making for banks andonlylargelenderscanafford toinvestinmachines,itremains to be seen whether smaller banks reduce theirfootprint. UNWILLING TO SETTLE for the sole offer made by Liberty House, lenders to ABG Shipyard have decided to try and attractmorebuyersinasecond round of bidding. Consequently, prospective buyers can come up with resolution plans to revive the bankrupt shipbuilding firm. While the deadline for the completion of resolution process under the Insolvency and Bankruptcy Code, 2016, expires on April 28, the courts are expected to give lenders a grace period. A formal announcement to this effect as made on Wednesday by the resolution professional. The committee ofcreditors(CoC)isunderstood to have rejected the bid from Liberty House on the grounds that the price of `2,200 crore offered is lower than the amountthatcanberecoveredif the business is liquidated. WhileitisnotclearhowABG was allowed to pile up loans of a staggering `19,000 crore, the factislenderstodayaresaddled with the highest stake in the firm of 49%.The original promoters—ledbychairmanRishi Agarwal—havelittleskininthe gamewithashareholdingofjust 9%.AttheendofMarch2016,a shareholding of 33.26% was held by ABG International and otherpromoters. Final date for APR submitting EoI 19 RP invites fresh EoI to submit resolution plan from APR 18 potential investors NS Vishwanathan RBI deputy governor lenders and borrowers as par for the course. “The data shows a large number of borrowers, even some highly rated ones, have Apple App Accelerator helps developers young and old The facility at Bengaluru has mentored thousands of young local developers to create innovative apps, and is now planning to offer business and marketing sessions ■ eFE, P13 QuickPicks ETF options for EPFO members OVER 5 crore subscribers of retirement fund body EPFO will get an option to increase or decrease investments of their provident fund into stocks through exchange-trade funds (ETFs) in the current financial year, reports PTI. The EPFO plans to credit ETF investments in the PF accounts in about three months; thereafter it would give subscribers an option to hike or cut investments in ETFs from their funds. PAGE 11 Uber COO on alliances in India ONLINE CAB aggregator Uber on Wednesday said that it is doubling its investment in the Indian market by pumping in funds to expand its products, partnerships and technology headcount in the country, reports fe Bureau in New Delhi. Uber COO Barney Harford reiterated that while the company is open to discussions, there is no interest in doing a minority stake deal in India. PAGE 6 March domestic air traffic surges THE DEMAND for air travel continues to be high with airlines reporting higher growth in passenger traffic, reports fe Bureau in New Dehi. According to DGCA data released on Wednesday, domestic air passenger traffic increased by over 28% in March compared with the same month last year, with domestic carriers carrying 11.58 million passengers. PAGE 6 APR 23 270-day period to complete resolution process ends APR 28 Last date for submitting MAR resolution plan 9 2018 RP extends deadline for sub- SEP mitting EoI to September 28 20 RP invites EoI from potential SEP investors 11 ABG Shipyard admitted by AUG NCLTAhmedabad 1 2017 ● 2G SCAM CBI to revive case against Essar’s Ruias, others failed on the one-day default norm.This has got to change,” the deputy governor asserted. Addressingthe14thconvocationattheNationalInstitute of Bank Management (NIBM), Vishwanathan said bankers should warn customers that theone-daydefaultwouldlead to theirbeing onwatch forresolution.Borrowers too,he said, should realise they must meet payment obligations as perthe contract and it is no longer enough to pay up only by 60/90 days past the due date. PRESS TRUST OF INDIA New Delhi, April 18 Continued on Page 2 PUSHING GROWTH Special Feature Last date for submitting resolution plan RP extends deadline for submitting resolution plan MAR 16 to March 26 RBI DG flags rising breaches A LARGE NUMBER of borrowers, including some highly rated ones, have defaulted on loan repayments under the current one-daydefault norm, Reserve Bank of India (RBI) deputy governor NS Vishwanathan said on Wednesday. The new rules require lenders toreportamissedinterestpayment on day one. Citing the “firstfewreportsreceivedfrom banks”, Vishwanathan said non-payment on the due date appears to be viewed by both Continued on Page 2 IN THE DOCK ONE-DAY DEFAULT NORMS SHAYAN GHOSH Pune, April 18 ABG’s net losses in 201617 were a whopping `5,716 crore on minuscule revenues of `16 crore. Despite the lenders sanctioning a generous corporate debt restructuring package in March 2014, with a lower interest rate, lenient repayment terms with a two-year moratorium to boot,the management was unable to revive the company. Infosys CEO says time to sacrifice margins BLOOMBERG Bengaluru, April 18 single one face to face in the next two quarters. He’s already making tough SALIL PAREKH DIDN’T get decisions. He says Infosys has muchtimetosettleinaftertak- to sacrifice profit margins now ing overthe helm of Infosys. byinvesting in advanced techSince becomnology and skills Salil Parekh says ingchiefexecutive in orderto capture Infosys has to officer in January, the opportunities the 53-year-old invest in advanced of the ahead. That has criss-crossed includespumping technology and three continents more money into skills to capture to meet with custechnologies such the opportunities as the Internet of tomers and of the ahead employees to get Things,retraining his hands around employees, localthechallengesfacising itsworkforce ing India’s iconic tech-services in the US and building up the giant.He talkedwith 48 clients sales staff. in his first three months — and he’s determined to see every Continued on Page 2 For and against Demonstrators holding placards and protesting against PM Narendra Modi walk past Modi’s supporters in London’s Parliament Square on Wednesday Ups and downs FE BUREAU Bond yield at week’s high, rupee 7-month low The benchmark bond yield rose 5 basis points on Wednesday to a one-week high of 7.54% while the rupee dropped 2 paise to a fresh seven-month low. `/$ (inverted scale) 10-year bond yield (%) 62.55 63.55 7.465 64.55 7.110 65.55 7.533 7.820 6.755 66.55 65.71 65.66 Sep 27, 2017 6.76 6.400 Apr 18, 2018 Oct 18, 2017 Apr 18, 2018 THE CENTRAL BUREAU of Investigation (CBI) has challenged in the Delhi High Court the acquittal of Essar Group promoters Ravi Kant Ruia and Anshuman Ruia and six others in a case arising out of the probe in the 2G scam case. Besides the Ruias, the CBI has also filed appeal against the acquittal of promoters of Loop Telecom IP Khaitan and Kiran Khaitan, Essar Group director (strategy and planning) Vikash Saraf and telecom firms Loop Telecom,LoopMobileIndiaand EssarTele Holding.The hearing is likelyonApril 20. The agency said in its appeal that the special judge failed to appreciate the evidence and the law in proper perspective and the evidence on record clearly establishes the offence committed by the accused. On December 21 last year, a special court acquitted the promoters of the Essar Group and Loop Telecom, and others in a case arising out of the 2G scam probe. The court had earlier charged them with the offence under Section 120 B (criminal conspiracy) read with Section 420 (cheating) of the Indian Penal Code, and a substantial charge of cheating was made out against Saraf. Continued on Page 2 OPENSIGNAL STUDY Airtel, Jio are the best and the worst in download speed, coverage FE BUREAU New Delhi, April 18 WITH DATA BECOMING the buzzword in mobile communication, speed is of essence andwith LTE 4G becoming the norm,downloadspeedisanew contested area between telecom operators. The latest report (December-February) from OpenSignal — an international agency that comes out with quarterly reports on data download speed and net- work coverage — shows the country’s top two players, Bharti Airtel and Reliance Jio, at the top as well as bottom of the heap in different seg- ments. While Bharti Airtel has toppedthechartintermsof4G download speed of 9.31 Mbps and Jio is at the bottom with a download speed of 5.13 Mbps, the ranking is the opposite when it comes to network coverage.As faras coverage is concerned,which means the abil- ity to find a 4G signal, Jio is at thetopwith96.4%coverageof its LTE network. This means the chances of a Jio subscriber not being able to get a 4G sig- STATE OF MOBILE NETWORKS IN INDIA 4G network coverage (%) Speed 4G download (Mbps) 96 9.31 Bharti Airtel 7.27 6.98 Idea Cellular Vodafone India Source: Open Signal 69 68 4G Speeds (Mbps) 67 16.9 6.07 Bharti Airtel Global average India 5.13 Reliance Jio Reliance Vodafone Idea Jio India Cellular nal isverylow.On this parameter,Bharticomesatthebottom with a coverage of only 66.81%. However, the OpenSignal report has commended both the operators, Jio for excellent coverage,especiallysinceithas no back-up of 2G or 3G that operatorslikeBharti,Vodafone or Idea have. “Of what use is speed if one can’t get a signal,” the report noted. Continued on Page 2
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