OPINION, P8 ECONOMY, P2 INTERNATIONAL, P14 GLOBAL GROWTH CONCERNS TRADE WAR Former RBI governor Rajan warns of toxic mix on trade No breakthrough in US-China talks as tariffs kick in EDITORIAL Maharashtra wants to ban markets to pay for MSP scheme EC doing well to pursue disqualification for paid news since the govt is doing little to fix this NEW DELHI, SATURDAY, AUGUST 25, 2018 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL.XLIV NO. 151, 22 PAGES, `10.00 (PATNA `9.00, RAIPUR `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: 38,251.80 ▼ 84.96 NIFTY: 11,557.10 ▼ 25.65 NIKKEI 225: 22,601.77 ▲ 190.95 HANG SENG: 27,671.87 ▼ 118.59 `/$: 69.91 ▲ 0.20 `/€: 80.98 ▲ 0.24 BRENT: $75.57 ▲ $0.84 GOLD: `29,561 ▲ `31 BATTLE FOR BOMBAY HOUSE Mistry gets partial relief from NCLAT NCLT Mumbai dismisses Mistry's plea Mistry moves NCLAT challenging NCLT's order 68.43 68.50 69.00 69.91 69.50 70.00 Aug 1, ‘18 Aug 24, ‘18 Special Feature Audi unveils electric PB18 e-tron supercar Audi says 0-100kph will take just over 2 seconds; total range is 310 miles. But don’t hold your breath: Audi would not confirm it will go into production any time soon, or ever ■ Motobahn, P13 QuickPicks RCom gets relief from dollar bondholders as deadline looms RELIANCE COMMUNICATIONS clinched the nod of overseas bondholders to ease its debt burden, putting the company a step closer to averting bankruptcy, reports Bloomberg. RCom, which defaulted last year on its $300-million bond, got 83% of the noteholders to approve the plan in London. Bondholders will receive $118 million in cash and $55 million in bonds. PAGE 6 Patanjali moves NCLT against Adani Wilmar’s Ruchi Soya bid THE BABA Ramdev-led Patanjali Ayurved has approached the NCLT challenging the decision by Ruchi Soya's lenders to approve Adani Wilmar's `6,000-crore takeover bid, reports PTI. The matter is expected to come up for hearing on August 27 before the Mumbai bench. On Thursday, Adani Wilmar's bid was approved by Ruchi Soya’s committee of creditors. PAGE 6 PULLING THE PLUG? Total projects 34 Total capacity 38,870 MW Commissioned capacity 23,550 MW Under construction 15,320 MW With PPA 20,317 MW With FSA 17,515 MW Continued on Page 2 Maha to jail agricultural traders FE BUREAU Pune, August 24 Continued on Page 2 from India, exporters said. In recent weeks, Beijing allowed a clutchofriceprocessorsinIndia, includingChamanLalSetiaand Adani Wilmar, to export the cereal to the world’s second largest economy after inspecting their facilities,while some companies, including Sukhbir Agro Energy and Pattabhi Agro Foods,weretoldtoimprovetheir storage conditions. The Centre is keen that rice exportstoChinamaterialise,as it will help India tap a hitherto untapped major market where it is one of the staple foods. THE MAHARASHTRA GOVERNMENT has clamped down on errant agricultural traders by proposing a law to jail them for a year if they fail to pay the minimum support prices (MSP) for crops. Such noncompliance will also attract a penalty of `50,000,according to the amendments proposed to the Maharashtra Agricultural Produce and Marketing (DevelopmentandRegulation) Act,1963. The move has raised the trading community’s hackles, which is threatening to close down the agricultural produce market committee (APMC) mandis.Currently,there are 16 crops that get the benefit of MSPsinthestate,mainlygrains, pulses and some cash crops. While the market in Jalna was shut on Thursday with traders protesting against the decision,APMCsinLatur,Akola, Washim, Barshi and parts of Nashik including Lasalgaon remained open on Friday after the chairmen of the APMCs managedtoconvincetradersto continue work since the notification isyet to come out. Lalitbhai Shah, chairman, Latur APMC, said: “I am not aware of what will happen on Monday when the market reopens. Traders here had refused to operate on Friday but agreed to trade after I placated them. Jalna remained closed on Thursday. Continued on Page 2 Continued on Page 2 GREATER NOIDA PROJECT DMICDC readies 400 acres to lease BANIKINKAR PATTANAYAK New Delhi, August 24 THE DELHI-MUMBAI Industrial Corridor Development Corporation (DMICDC) has put on the block around 400 acres of land in its Greater Noida project for industries and has leased 137 acres of it to three companies,including Haier Appliances India, DMICDC chief executive officer Alkesh Kumar Sharma told FE. The base price of land for setting up manufacturing units here are learnt to be in the range of `5,100-11,000 per square metre (the bigger the allocation,the lower could be the per-unit rates), while those for establishing IT services facilities have been fixed at roughly`20,000 persquare metre.This is because companies need much larger area to set up manufacturing units than IT services ones. While Haier has got close to 123.7 acres in DMICDC’s Integrated Industrial Township in Greater Noida,Satkriti Infotainment has been allocated 9.8 acres and Forme 400 acres Available for industry, of the 750-acre Greater Noida project `5,100-11,000/ sq metre Base prices of land to set up manufacturing units `20,000/sq metre Base prices of land to establish IT services facilities Haier Appliances Satkriti Infotainment Forme Trading Land allocated (in acre) 9.8 123.7 3.5 Proposed investment (in ` cr) 3,069 235 100 Source: DMICDC Trading 3.5 acres. Haier is expected to create 3,950 jobs at this unit, and the two others pledge direct employment to 3,600 people. Continued on Page 2 pany Law Tribunal (NCLT) for insolvency proceedings as per theReserveBankofIndia’s(RBI) February12circular.PowerproducershadapproachedtheAllahabad High Court for relief but none has been forthcoming so far with the court not having stayed the RBI circular. “We have found interested buyers for seven to eight power sector accounts.We don’t see a major spurt in NCLT references due to the August 27 deadline,” Basu said. Some of the key private sector assets where SBI is the lead banker include Adani Tiroda with an outstanding of `11,765 crore, Adhunik Power (`2,473 crore), JaypeeBara(`11,494crore), Athena unit 1 and 2 (`5,256 crore) and DB Power Baradhara (`6,721crore),amongothers. On Tuesday, the Allahabad HCreserveditsjudgmentonthe case where private power producers wanted the RBI to allow special dispensation to the power sector regarding its February12 circular. ● FLOUTING MSPs Rowed to victory The Indian rowing contingent won three medals, including a historic gold in quadruple sculls, at the 18th Asian Games, in Indonesia on Friday PTI ● NON-BASMATI RICE Two firms win China export orders PRABHUDATTA MISHRA New Delhi, August 24 A NEW BEGINNING TWO INDIAN COMPANIES — Sukhbir Agro Energy and PattabhiAgroFoods—havebagged export orders of 600 tonnes of non-basmati rice from China, pavingthewayforthefirstshipment of the cereal to the neighbouring country after it agreed last month to import it from India.Theexportswilltakeplace soon after the rice processing plants of these two companies are approved byChina. Amid the stand-offwith the US on tariffs, China appears to be serious on importing rice ■ India exported rice worth `49,838 crore in FY18, 54% of which was basmati rice ■ China is world's largest producer/ importer of rice; it buys mainly from Vietnam, Thailand and Pakistan TRAI NUMBERS Aggressive entrant Jio tops the telco tables in terms of AGR RISHI RANJAN KALA New Delhi, August 24 RELIANCE JIO HAS emerged as the country’s biggest telecom service provider on the basis of adjusted gross revenue (AGR), pipping Bharti Airtel, during the April-June quarter, accordingtodatasourcedfrom the Telecom Regulatory Authority of India (Trai). However,thisisonthebasis of only the access service licences. When the national long-distance (NLD)revenueis added, Bharti Airtel continues to be the largest telco. According to Trai data released on Friday, during the April-June quarter, Jio’s AGR for access services stood at `7,125.69 crore, higher than Bharti’s `6,723.54 crore. After adding the NLD revenues,Bharti’s totalAGRstood at `10,192.12 crore, higher than Jio’s `7,200.40 crore. During the January-March quarter, Jio for the first time had pipped Vodafone to become the second largest 8,000 7,000 6,000 Q1 FY19 (` crore) AGR* LF SUC 5,000 4,000 3,000 2,000 1,000 0 Reliance Jio Bharti Airtel Vodafone India 165 Inverted scale Continued on Page 2 3,785 `/$ appellants and others during the pendency of the appeal,” the NCLAT interim order said. During arguments, Tata Sons contended that it was always a closely held private entity but was considered a public limited company due to a legal provision which made firms deemed public company if their annual turnover exceeded a particular amount. The Tata Sons counsel said that it thus became a “hybrid” firm in 1975 by retaining the restrictions under lawwhich applies to a private company. THE SUPREME COURT on Fridaydismissed embattled Essar Steel’s petition seeking compensation of `26,000 crore from the government for“disrupting” supply of gas to its sponge iron/steel plant in Hazira, Gujarat.A bench led by justice Ranjan Gogoi however saidthatitwillbeopentoEssar “to contest the proceedings in the connected cases relating to allocation of gas to different priority sectors”. Essar Steel had earlier moved the apex court seeking parity with the fertiliser and power sectors after the ministry of petroleum and natural gas in March 2015 had introduced a gas pooling policy, ‘Approval to innovative mechanism for utilisation of stranded gas based generation capacity’, to ensure adequate supply of gas to stranded gasbased power plants. 303 The rupee on Friday slipped to a record low of 70.2350 against the dollar in intra-currency trades but ended the session above the 70 mark at 69.910. The Indian currency has now lost nearly 9% since January making it Asia's worst performing currency. RoC nod toTata Sons for conversion into a private company WITH THE DEADLINE for the resolution of at least 60 large assets — each above `2,000 crore — set to expire on August 27, banks are staring at a big jumpinprovisionsasinsolvency proceedings will need to be initiatedfortheseaccounts.Thelist of assets includes around 34 fromthepowersectorinvolving a bank exposure of approximately`1.74 lakh crore. State Bank of India (SBI) is close to resolving seven to eight distressed power sector accountswithadebtof`17,000 crore,the bank’s MDArijit Basu told a business news channel on Friday. Earlier in the week, SBI chairman Rajnish Kumar had said at an event that there had been “good progress” on resolvingsomeofthedistressed power sector accounts and that there are“lot of buyers”now. SBI’s solutions come days before the crucial August 27 deadline, after which stressed accounts are supposed to be referred to the National Com- 199 FE BUREAU public limited one restricts minority shareholders’ rights to sell their shares to external parties.Further,underArticle 75 of the articles of association of Tata Sons, the board can force a minority shareholder to sell out. “Taking into consideration the facts and that the appeal is pending and if the appellants are forced to sell their shares which mayaffect the merits of the appeal, as they will cease to be member(s) of the company (Tata Sons),we direct the respondents (Tata) not take any step in terms of Article 75 for transfer of shares of minority shareholders like Aug 6 FE BUREAU Mumbai, August 24 4,484 IN A PARTIAL relief for Cyrus Mistry,the National Company Law Appellate Tribunal (NCLAT)on Friday restrained Tata Sons from forcing him out of the companyas a shareholder but refused to stay the conversion of the holding firm into a private company from a public limited one.The restraint on Tata Sons shall remain in force till the appellate tribunal hears the merits of Mistry’s petition challenging his ouster as chairman of the group holding firm in October2016,which has been upheld by the Mumbai bench of the National Company Law Tribunal (NCLT). In its interim orderon Mistry’s plea for putting on hold the approval for conversion of Tata Sons into a private companyfromapubliclimitedone, the appellate tribunal admitted his petition against the move and posted the matter for hearing on September 24. The conversion of a company into a private one from a Rupee hits record low of 70.23 70.50 Aug 3 SURYA SARATHI RAY New Delhi, August 24 Currency concern 68.00 Mistry moves NCLT challenging his removal July 9, 2018 Banks eye higher provisions as Aug 27 deadline approaches 359 Continued on Page 2 Mistry ousted as Tata Sons chairman Dec 2016 6,724 THE FEDERAL RESERVE'S steady interest rate hikes are the best way to protect the US economic recovery , Fed chair Jerome Powell said on Fridayin a high-profile endorsement of the central bank’s current approach to policy. Speaking just days after President Donald Trump criticised the US central bank’s rate hikes, Powell used an annual research symposium here to“explain todaywhy my colleagues and I believe that this gradual process...remains appropriate”. “The economy is strong. Inflation is nearour2% objective, and most people who want a job are finding one... If the strong growth in income and jobs continues, further gradual increases in the target rangeforthefederalfundsrate will likely be appropriate.” FE BUREAU New Delhi, August 24 Oct 24, 2016 538 278 REUTERS Jackson Hole, August 24 Restrains Tata Sons from forcing him out but refuses to stay conversion of holding firm into a private company 7,126 Powell signals more rate hikes ahead SC rejects Essar Steel’s plea for compensation 570 277 ● FED’S VIEW STRESSED POWER ASSETS ● `26,000-CR APPEAL Idea Cellular *AGR calculation does not include NLD (national long distance) revenues. With NLD revenues, Bharti will still be the top operator with AGR of `10,192.12 cr, while Jio's AGR will be `7,200.40 cr. Adjusted gross revenue (AGR), licence fee (LF) and spectrum usage charge (SUC) telecom operator in terms of AGR (without NLD revenues). Its AGR then stood at `6,217.60 crore against Bharti’s `7,085.50 crore, and Vodafone’s `5,095.80 crore. However, then too, after addingNLDrevenues,Vodafone wasaheadofJioandVodafone’s AGR came at `6,976.20 crore versusJio’s`6,309.40crore.But in theApril-June quarterJio has raced ahead of Vodafone after taking into account the NLD revenues also. The pecking order would change as Vodafone and Idea have merged and soon would startreportingcombinedAGR. The AGR of telecom service providersisanimportantnumber because licence fee and spectrum usage charges (SUC) are paid to the government as a percentage of it. Operators pay 8% of their AGR as licence fee and around 5-6% as SUC. In terms of mobile subscribers, Jio is still fourth, but is rapidly adding numbers. Continued on Page 2
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