OPINION, P8 ECONOMY, P2 INTERNATIONAL, P14 MAKING WAVES DIESEL-CHEATING CASE New telecom policy likely to be rolled out in June: Sundararajan Former Volkswagen CEO Winterkorn charged by US EDITORIAL Electricity-for-all could mean huge losses for SEBs ABD proposal to tax rich to fund those losing jobs to AI misses the point MUMBAI, SATURDAY, MAY 5, 2018 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOLUME XXXXXV NO. 350, 20 PAGES, `10.00 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: 34,915.38 ▼ 187.76 NIFTY: 10,618.25 ▼ 61.40 NIKKEI 225: 22,472.78 ▼ 35.25 HANG SENG: 29,926.50 ▼ 386.87 `/$: 66.87 ▼ 0.23 `/€: 79.99 ▼ 0.19 BRENT: $73.72 ▲ $0.10 GOLD: `31,003.00 ▲ `98.00 QuickPicks Sebi allows equity derivative trading till 11.55 pm from Oct SEBI ON Friday allowed stock exchanges to extend trading in equity derivatives till 11.55 pm in order to align their trade timing with that of commodity derivatives in the country, reports fe Bureau in Mumbai. According to a Sebi circular, from October 1, stock exchanges have been permitted to set their trading hours in the equity derivatives segment between 9 am and 11.55 pm. At present, trading is allowed from 9.15 am to 3.30 pm. Earlier, Sebi had allowed unified exchanges for stocks, commodities and derivatives. PAGE 11 Monsanto appeals to Supreme Court over GM cotton patents MONSANTO HAS appealed to the Supreme Court against a ruling by the Delhi HC which decreed last month that the world's biggest seedmaker cannot claim patents on its genetically modified (GM) cotton seeds, a company spokesman said, reports Reuters. The Delhi HC last month concurred with Indian seed company Nuziveedu Seeds, which argued that India's Patent Act does not allow Monsanto any patent cover for its GM cotton seeds. Monsanto has appealed to the Supreme Court. PAGE 12 Rating agencies to assess loan quality of stressed power projects LENDERS TO thermal power projects have decided to assign rating agencies to determine the “sustainable debt” levels of completed power plants with existing power purchase agreements and coal supply arrangements, reports Anupam Chatterjee in New Delhi. Bankers, led by SBI, had met earlier this week in Mumbai to decide the fate of 16 such projects. “Interest for the projects with appropriate sustainable loans would be put up for auction,” a source told FE. PAGE 2 FE BUREAU Positive start to April quarter Manufacturing PMI Services PMI 55 51.6 53 49.6 49 51.4 47 46.8 Dec 2016 Note: Reading below 50 suggests contraction and above it indicates expansion April 2018 Source: Nikkei, IHS Markit ● BJP’S KARNATAKA MANIFESTO Cows, farms and phones in focus PRESS TRUST OF INDIA Bengaluru, May 4 FROM FARM LOANwaiverand other sops to farmers,freebies like laptops for students and smartphones for below poverty line (BPL) women to a commission for cow protection, the BJP on Friday made a plethora of promises in its manifesto for the Karnataka assembly polls to reach out to various sections. As it seeks to wrest the state from the Congress, the BJP said `1.5 lakh crore will be spent on irrigation projects and farm loans of up to `1 lakh borrowed from nationalised and cooperative banks will be waived if it is digital transactions referred to another GoM furtherdeliberations. As reported by FE earlier, despite the council’s nod, the new returns system can be implemented fullyonlyaftera year.The systemwill allowtaxpayers to just upload invoice- Continued on Page 2 JIO EFFECT Revenues of legacy telcos, Centre drop for first time FE BUREAU New Delhi, May 4 51 45 ■ Incentive scheme for voted to power. The manifesto,unveiled by Karnataka BJP president and its chief ministerial candidate BS Yeddyurappa, says a ‘white paper’ will be brought out on the state’s financial health under the Congress rule after the BJP forms a government. Continued on Page 2 Financial data (` crore) CY2016 THE GOVERNMENTMAYhave just released a draft national telecom policy that states the objective of attracting investmentsworth$100billion(`6.5 lakh crore) in the sector by 2022; however, data released by the Telecom Regulatory Authority of India on Friday show that for the first time, in calendar year 2017 the industry showed a decline on all parameterscomparedtoCY16. ItistobenotedthatReliance Jio started its commercial services in September 2016,leading to a majordrop invoice and data rates, which fuelled this decline. With the operators’ gross revenue and adjusted gross revenue (AGR) declining, eventhegovernment’srevenue by way of licence fee and spectrum usage charge fell for the first time in a calendaryear. The gross revenue of the Adjusted gross revenue (` crore) CY2016 CY2017 Yearly growth (%) 8.6 24.5 18.9 18.8 CY2017 Change (%) 32.8 operators fell by 8.56% to `2.55 lakh crore in CY17.Similarly, the AGR fell 18.87% to `1.6 lakh crore.Since the operators pay licence fee and spectrum usage charge to the government as a percentage (8% and 5%, respectively) of their AGR,governmentrevenuealso 24.1 23.2 2,564 -303 7,466 THE GOODS AND Services Tax Council on Friday approved a new comprehensive returngenerationsystemandfullgovernmentownershipofGSTNetwork(GSTN)—theITbackbone forGST—while referring a proposal to impose a cess on sugar andanincentiveschemefordigitaltransactionstotwoseparate groups of ministers (GoMs) for RJio Work is on on software that detects human trafficking and other forms of human bondage. Traffickers are getting smart about this, but innovation is till one step ahead ■ Science & Tech, P13 India's services sector continued to improve for the second month in a row in April, reflecting better demand conditions even as job-creation pace accelerated to the fastest pace in more than seven years. Easing inflationary pressures also helped demand conditions. as it could distort GST, open a Pandora’s box 29,436 22,616 ‘Traffic jammers’ to take on modern day slavery referred to GoM ■ Council divided on cess ■ GoM to discuss revenue options to meet contingencies FE BUREAU New Delhi, May 4 SERVICES PMI Special Feature Continued on Page 2 ALL IN A DAY ■ Sugar cess proposal Idea Continued on Page 2 Related report on Page 6 Current system to stay for six months, the next half-year will see system of provisional credits 34,680 26,308 Milestones New returns system, fully state-run GSTN get nod Vodafone APR 27: Flipkart, registered in Singapore, buy backs shares from minority shareholders for $350 m, valuation at $17.69 bn 2016 FEB: In a first, Morgan Stanley MF marks valuation to about $11 bn GST COUNCIL 48,880 36,922 2018 wise details of sales while the system will generate the returns.The ITsystemwill also calculate the tax liability and input tax credit (ITC) availability on behalf of the assessee and provide for a semi-automatic reversal of credits. For the next six months, finance secretary Hasmukh Adhia said, taxpayers will continue to file summary return GSTR-3BandGSTR-1(outward supply details). After that, he said,the newsystemwill be put in place but assessees will be allowed to claim provisional input tax credit for a period six months, which means a taxpayer can seek the credit even when the supporting invoices aren’t uploaded bythe seller. PTI Bharti 2017 AUG: SoftBank invests $2.5 bn via its Vision Fund Qatar Investment Authority SEPT: Valuation rises to its peak at $15.2 bn Finance minister Arun Jaitley and finance secretary Hasmukh Adhia at the 27th Goods and Services Tax Council meeting in New Delhi on Friday Spectrum 7,574 usage charges 5,089 THE BOARD OF Flipkart Online Services has approved an agreement to sell about 75% of the company to a Walmart-led group for approximately $15 billion, according to people familiar with the matter, an enormous bet by the 2015 American retailer JULY: on international Flipkart expansion. raises Under the pro$700 m posed deal, Softfrom Tiger, 15,975 12,976 BLOOMBERG Bengaluru, May 4 THE DALMIA BHARAT-CONTROLLED Rajputana Properties(RPPL)onFridaymovedthe National Company Law Appellate Tribunal (NCLAT) against the order of the Kolkata bench of the National Company Law Tribunal (NCLT), which had asked the resolution professional (RP) and the committee of creditors (CoC) to consider the revised offer of UltraTech CementforbeleagueredBinani Cement.Theappellatetribunal, however, refused to pass any interim stayorder. The NCLAT listed the matter for hearing on May 22. On Friday, Dalmia Bharat filed an application before the appellatetribunal,challenging the NCLT order dated May 2. Passing an order on the ongoing resolution process for Binani Cement, the Kolkata benchofthetribunalhadasked the RP, Vijaykumar V Iyer, to accept the revised offer of around `7,900 crore from UltraTechCementwithinthree days. The bench had also directedtheCoCtoconsiderthe revisedofferalongwiththeresolution plan of the country’s largestcementmaker,bringing it back in the race foracquiring Binani.The bench also offered RPPLachancetobetteritsoffer of `6,930 crore and compete for the asset. Hearing the matter, a twomember bench of justices SJ Mukhopadhaya and Bansi Lal Bhatt of the appellate tribunal declined to grant an interim stay of the NCLT order. Licence fee BENCHMARKS EXTENDED THEIR slide for the second session on Friday, suffering their first weekly drop in six weeks on weak global cues, reports PTI. The Sensex tumbled over 188 points to close at 34,915.38, its weakest closing since April 26, when it had settled at 34,713.60. The Nifty shed 61.40 points to 10,618.25 on across-the-board selling. MITHUN DASGUPTA Kolkata, May 4 1,98,207 1,60,814 Stocks skid, post first weekly fall in six likely to participate in the investmentwithWalmart,said one of the people.A final close is expected within 10 days, though terms could still Bank Group will sell all of the change and a deal isn’t certain, 20%-plus stake it holds in they said. That would seal a Walmart Flipkart through an investment fund at a valuation of triumph over Amazon.com, roughly $20 billion, said the which has been trying to take people,asking not to be named control of Flipkartwith a combecause the matter is private. peting offer. Flipkart’s board Google-parent Alphabet is ultimately decided a deal with Walmart is more likely to win regulatory approval because 2012 Amazon is the No. 2 e-comAUG: merceoperatorinIndiabehind Naspers Flipkart and its primary comfunding of $150 m petitor. Amazon is out of the values running unless Walmart hits Flipkart at unforeseen trouble. $1 bn If completed, the deal 2010 will give Bentonville, JAN: 2014 Arkansas-based Walmart Tiger MAY: a leading position in the Global Flipkart invests growingmarketof1.3bilbuys Myntra $10 m lion people and a chance for $300 m, raises torebuilditsrepu$210 m tation online. The 2011 from DST 2008 world’s largest Global; MAR: retailer has strugOCT: valued at Tiger Flipkart gled against Ama$2.6 bn Global Online zon as consumers JULY: invests Services $1 bn increase their $20 m incorpofunding spending on the rated from GIC, internet. Tiger Global India is the & Naspers next big potential takes prizeaftertheUSand valuation to $7 bn China,where foreign retailers have made little progress against Alibaba Group Holding. “Flipkart is key to a global e-commerce strategy,” said Arvind Singhal, chairman of theNewDelhi-basedretailconsultancyTechnopakAdvisors. Believes likelier to to get regulatory approval than going with Amazon; SoftBank to exit Adjusted gross revenue KEEN TO GAIN a firm foothold in India through the acquisition of debtladen Essar Steel, ArcelorMittal on Friday said “a swift decision” on the case will be in the best interest of all stakeholders, reports PTI. The committee of creditors had on Wednesday met representatives of ArcelorMittal and Numetal which are in the race to acquire Essar Steel. Flipkart board opts for Walmart deal Dalmia Bharat moves NCLAT against NCLT direction 2,79,591 2,55,655 Swift decision on Essar in interest of all: ArcelorMittal ● BINANI CEMENT Gross revenue SEBI HAS KEPT HDFC Asset Management Company's proposed IPO in abeyance “for examination of past violations”, the latest update with the markets regulator showed, reports PTI. The fund house had filed preliminary papers with Sebi in March, seeking approval to float an initial public offering. Without disclosing the nature of violations, Sebi said it has kept the IPO papers “in abeyance for examination of past violations”. $15-BILLION DEAL Source: Trai declined during the year.Total collectionsforthegovernment from licence fee came down by 18.78% to `12,976 crore, while revenue from from spectrum usage charges fell 32.81% to `5,089 crore. Continued on Page 2 LESS-THAN-NOBLE After sex scandal, no 2018 Nobel Prize in Literature, panel says NEW YORK TIMES Stockholm, May 4 THE SWEDISH PANEL that awards the Nobel Prize in Literature said on Friday that it would take the extraordinary step of not naming a laureate this year — not because of a shortage of deserving writers, but because of the infighting and public outrage that have engulfed the group over a sexual abuse scandal. The Swedish Academy said it would postpone the 2018 award until next year, when it will name two winners, making this the first year since WorldWarII that the panel has decided not to bestow one of the world’s most revered cultural honours.The academy is involved only in the literature award, so other Nobel Prizes are not affected. Thoughtheprizesshouldbe awarded annually, they can be postponed or skipped “when a situation in a prize-awarding institutionarisesthatissoserious that a prize decision will ILLUSTRATION: ROHNIT PHORE IN THE NEWS Sebi keeps HDFC AMC's IPO in abeyance not be perceived as credible”, the Nobel Foundation, which governs all of the prizes,said in a statement posted online on Friday morning.“The crisis in the Swedish Academy has adversely affected the Nobel Prize. Their decision underscores the seriousness of the situation and will help safeguard the long-term reputation of the Nobel Prize.” PeterEnglund,amemberof theacademy,wroteinanemail: “I think this was a wise decision, considering both the inner turmoil of the Academy and the subsequent bloodlettingofpeopleandcompetence, andthegeneralstandingofthe prize.Who would really care to accept this award under the current circumstances?” The announcement that there will be no 2018 prize is the latest in a series of blows to the academythat,occurring in the glare of the #MeToo movement, have drawn worldwide attention. Continued on Page 2
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