OPINION, P8 COMMODITIES, P12 OIL PRICES India’s aviation FDI policy is a mess, as QatarAir CEO says Centre's revenues from oil fell in FY18 while states' rose -get them to cut VAT VOICE-MESSAGING TECH Saudi Arabia aims to keep crude in $70-80 band EDITORIAL INTERNATIONAL, P14 Zuckerberg-led Facebook suing BlackBerry for patent infringement MUMBAI, THURSDAY, SEPTEMBER 6, 2018 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL. 58 NO. 212, 28 PAGES, `7.00 P U B L I S H E D F R O M : A H M E D A B A D , B E N G A L U R U , C H A N D I G A R H , C H E N N A I , H Y D E R A B A D , K O C H I , K O L K ATA , L U C K N O W, M U M B A I , N E W D E L H I , P U N E SENSEX: 38,018.31 ▼ 139.61 NIFTY: 11,476.95 ▼ 43.35 NIKKEI 225: 22,580.83 ▼ 116.07 HANG SENG: 27,243.85 ▼ 729.49 `/$: 71.76 ▼ 0.19 `/€: 83.10 ▼ 0.39 BRENT: $77.72 ▼ $0.45 GOLD: `30,274 ▲ `83 CURRENCY WOES Rupee at new lows, yields trend higher Rupee edges closer to the 72 mark vs the dollar, ends session at fresh closing low of 71.75 IN THE NEWS Farmers, workers rally over loan waiver, wages `/$ 71.4 71.454 Intra-day, Sept 5 Inverted scale 71.756 71.6 71.8 72.0 TUSHAR GOENKA Mumbai, September 5 THE RUPEE ON Wednesday slipped to yet another record low of 71.97 against the dollar in intra-day trades before endingthesessionatafreshclosing lowof71.7562.Dealerssaidthe ReserveBankofIndia(RBI)had stepped in to intervene though the quantum of dollar selling was not known.The rupee has given up 2.3% in the past six sessions alone. Meanwhile,the yield on the benchmark bond rose to a near four-year high of 8.111%, in intra-daytrades.However,they retreated somewhat in sync with the recovery in the rupee THOUSANDS OF farmers and workers affiliated to Leftwing outfits took out a protest march in the national capital on Wednesday, demanding implementation of remunerative prices for farm produce, loan waiver, labour laws and a minimum wage of `18,000 a month, reports PTI. The ‘Mazdoor Kishan Sangharsh Rally’, organised jointly by the Centre of Indian Trade Unions, All India Kisan Sabha and All-India Agricultural Workers' Union, began from the Ramlila Maidan amid rains and passed through various roads to culminate at Parliament Street. 72.2 Open Close 10-year bond yield There is no need for any panic or knee-jerk reaction to the depreciation of the rupee. The inherent strength of the economy will support the rupee. — ARUN JAITLEY, FINANCE MINISTER (%) Intra-day, Sept 5 8.12 8.09 8.049 8.06 8.03 8.00 8.042 Open Close to close at 8.049, two basis points (bps) lower than Tuesday’s close of 8.063%. Theyield has nowhardened by15bpsinthepastseventrad- ing sessions as the markets are convinced the central bankwill raisethekeyreporatebyatleast 25 basis points if not 50 bps betweennowandMarch2019. Fearsoftheratehikehaveledto a sharp fall in banks’ stocks in the past couple of sessions as investors apprehend losses on lenders’bond portfolios. The sharp decline in the rupee even without any strengthening of the dollar has leftthecurrencymarketsjittery. Continued on Page 2 FINANCIAL INCLUSION Schemes offer more benefits India, US officials spar over trade FE BUREAU New Delhi, September 5 SENIOR TRADE policymakers from India and the US sparred on Wednesday, defending their respective positions on cross-border business, reports PTI. Pitching for less protectionism, India's commerce secretary Anup Wadhawan stressed on the need to go beyond trade deficits and frame tariffs as per the prevailing economic strengths. THE CABINET ON Tuesday reinforceditsflagshipfinancial inclusion scheme, by doubling the overdraft limit to `10,000 under the Pradhan Mantri Jan Dhan Yojana (PMJDY) and allowing holders of such nofrills accounts to withdraw as much as `2,000 without any conditions. The age limit for availingofsuchoverdraftfacil- Special Features Oppo F9 Pro & Honor Play: Fit for work and play Oppo F9 Pro guarantees a great battery life with fast charging while Honor Play equipped with the Kirin 970 AI processor is a powerful performer, apt for serious gamers ■ Gadgets, P13 QuickPicks GDP growth: Manufacturing overestimated,says MPC member INDIA PROBABLY overestimated manufacturing output while calculating economic growth that topped 8% in the June quarter, according to a member of the central bank’s rate-setting panel, reports Bloomberg. The new GDP series has mostly replaced the Annual Survey of Industries with corporate financial data for estimating manufacturing value added, according to an article by Ravindra Dholakia, a Monetary Policy Committee member, co-authored with R Nagaraj and Manish Pandya. PAGE 2 Not the right time to list OVL, says company executive THE DEPARTMENT of investment and public asset management (DIPAM) has asked ONGC to list its overseas arm ONGC Videsh (OVL) on the Indian stock exchanges, but a top OVL executive on Tuesday said this was not the right time to do so, reports fe Bureau in New Delhi. “We have many projects such as that in Mozambique and Venezuela, which are still to be monetised. At this moment, the company’s right valuation will not be reflected,” the executive said. PAGE 7 IRCON’s IPO to hit market by September 18 THE INITIAL public offering of (IPO) of railway PSU IRCON International is set to hit the market on September 17 or 18, reports Saurabh Kumar in New Delhi. Around 1 crore equity shares of the firm with a face value `10 each will be up on offer. While the government plans to divest 10% of its stake in the construction company via an IPO, around 0.53%, or 5 lakh equity shares, on and above what will be available for public, will be offered to its employees. PAGE 2 ity has also been raised to 65 years from 60 earlier. The PMJDY, under which 32.54 crore accounts have been opened since inception, would now be an open-ended scheme,finance ministerArun Jaitley said. According to him, the PMJDY accounts, 83% of whichareAadhaar-seeded,collectivelyhavedepositsofabout `81,200 crore now. Continued on Page 2 STRESSED POWER ASSETS REC asked to remodel Pariwartan ARC ANUPAM CHATTERJEE New Delhi, September 5 WITH THE RESERVE Bank of India refusing to the relax its norms for asset reconstruction companies (ARCs) exclusively for the one planned for the power sector, the government has asked the Rural ElectrificationCorporation(REC)totweak the structure of the proposed ARC under the so-called Pariwartan scheme. This would mean that the ARC would have to make upfront payment of 15% of thevalue of the assets it assumestothebanksconcerned andalsomaintaina15%capital adequacy.Also,lenderswillhave to continue making provisions as per the stressed projects’net assetvalue. ThePariwartanschemeprovidesforatransitorywarehousing of the viable lot of the stressed power assets and safeguarding the value of these assets from anyimmediate distress sale under the Insolvency and Bankruptcy Code.The idea istokeeptheassetsfromdeteriorating and auction them off when powerdemand picks up. Under the model prepared byREC,theARC underthe Pariwartan scheme was to have a waiver from the 15% upfront payment and the capital adequacy norm; also,provisioning by banks were to be as per the assets’netbookvalue—whichis thedifferencebetweentheprincipal value and the provisioned value of the stressed assets. It is estimated that about 11,400 MW of power projects canbeparkedinthePariwartan ARC.In addition to operational projects,thosewheremorethan 80% of construction is complete are among these.According to sources, state-run NTPC PARKING FACILITY About 11,400 MW of power projects can be parked in Pariwartan ARC Assets to be auctioned as soon as power demand picks up If no viable exit is found within five years, assets to go to NCLT COURTING TROUBLE Delhi HC cracks whip on Malvinder INDU BHAN New Delhi, September 5 CRACKINGTHEWHIP fordisobeyingitsorderpassedinFebruary, the Delhi High Court on Wednesday asked former Ranbaxy promoter Malvinder Singh to deposit the sale proceeds of around S$3.5 million of his shareholding in Singapore-listed Religare Health Trust within fourweeks. Justice Rajiv Shakdher also barred Malvinder and his brother Shivinder Singh from moving any assets abroad and also directed freezing of their sharesinBestHealthcare,which owns the Fortis trademark. Italsodirectedthereleaseof `9.38 crore received by them from the sale of their shares in listed companies towards part payment of Japanese pharma major Daiichi Sankyo’s `3,500-crore arbitral award against the brothers. Justice Shakdher said undoubtedly there has been disobedienceofthecourt’spre- The court had ordered in February that the brothers maintain status quo on the assets disclosed by them Still 45 lakh equity shares in Religare Healthcare were sold in Singapore inApril vious directions by Malvinder, who along with his brother Shivinder Singh, was directed not to sell their assets. The HC also asked Malvinder to furnish all the details with regard to sale like who mandated the share sale,communications that took place, brokerdetails,actualsalevalue, etc. Thecourt’sordercameafter The court said thiswould not have come to light had it not asked for bank statements The case pertains to Daiichi Sankyo seeking execution ofthe `3,500-cr arbitral awardwon by it inApril 2016 NCLT to hear brothers’ dispute today PRESS TRUST OF INDIA New Delhi, September 5 it was informed by the counsel forMalvinder,whowaspresent in the court, that his 45 lakh equity shares in Religare Healthcare Pvt Ltdwere sold in Singapore inApril. The judge also said that the sale of shares “would not have come out,had we not asked for the bank statements”. FORMER FORTIS HEALTHCARE promoter Shivinder Mohan Singh has alleged that his elder brother Malvinder forged his wife’s signature, perpetrated illegal financial transactions and led the company into an unsustainable debt trap. In a petition filed before the New Delhi bench of the National Company Law Tribunal (NCLT), the younger of the Singh siblings, who were synonymous with each other for decades, sued Malvinder for “oppression and mismanagement” of their companies. Continued on Page 2 Detailed report on Page 6 ● KYC FOR FPIS To review April circular, says Sebi FE BUREAU New Delhi, September 5 AMID APPREHENSIONS THAT its April 10 circular on beneficial ownership of offshore funds could cause potential capital outflows of $75 billion,the Securities and Exchange Board of India (Sebi) said on Wednesday it would review the matter and take a “holistic view”, seeking to assuage panic among investors. The markets regulator said a working group, set up under former Reserve Bank of India deputy governor HR Khan to address various issues relating to the circular, has already heard various stakeholders and is in the process of giving its recommendations. “Ministry of finance,government of India has also been consulted on various issues.Based on these inputs, Sebi would review the matter and shortly take a holistic view,” it said in a statement. On Tuesday, economic affairs secretary Subhash Chandra Garg, too, sought to downplay fears of huge capital outflows,saying the directive has no“immediate implications”. He added Sebi had already extended the circular’s deadline to December 31 for providing details on the beneficial owners — or the natural persons who ultimately own or control foreign portfolio investors (FPIs). Sporting interaction PM Narendra Modi interacts with medal winners of the Asian Games 2018 in New Delhi on Wednesday. Sports minister Rajyavardhan Singh Rathore is also seen. Services PMI Growth slows in August The pace of growth in India's service economy cooled in August from July's 21-month peak. August saw the slowest expansions in 'new business' and 'employment' since May and November 2017, respectively. FE BUREAU 55 Manufacturing PMI Services PMI 51.7 53 50.4 51 51.5 49 48.7 47 45 Jan 2017 Note: Reading below 50 suggests contraction and above it indicates expansion Aug 2018 Source: Nikkei, IHS Markit Continued on Page 2 ASSURANCE ON SOLID-WASTE HANDLING hasbeenapproachedtomanage the regular operations and maintenanceoftheplantsbeing warehoused.Thesourcesadded that it could take about four weeks to register an ARC under the Pariwartan scheme. The scheme was aimed to save power projects from being sold at very low rates,saving lenders from heavy haircuts that the NationalCompanyLawTribunal (NCLT) process might result in. Lenders will have to file for insolvencyproceedings against stressed power assets worth about `1.8 lakh crore by September 11 after the Allahabad High Court refusing to provide anyinterimrelieftopowercompanies from the RBI’s February 12 circular mandating early detection of bad loans. Continued on Page 2 SC lifts ban on construction in Maha, U’khand FE BUREAU New Delhi, September 5 IN A MAJOR relief to the real estatesector,theSupremeCourt on Wednesday lifted a ban on constructionactivitiesinMaharashtra and Uttarakhand. The topcourthadonFridayimposed a ban on construction activities in three states — Maharashtra, Uttarakhand and Madhya Pradesh—citingtheirfailureto frame a policy on solid waste management. A bench led by Justice MB Lokur lifted the ban on the two states after the state governments informed it that they have framed a policy on solid wastemanagement.TheMaharashtragovernmentsaidthatits revised policy on solid waste management will be soon placed before the Cabinet for approval. The top court lifted the ban on Uttarakhand after the state government emphasised on its need to carry out construction work in disaster-prone areas. The Uttarakhand govern- ment had on Tuesday moved thetopcourtseekingvacationof its order staying construction activities in some states and Union territories, saying it was facing a“crisis situation”due to artificial lake formation in the Tehri Garhwal area after huge landslides. The counsel, appearing for Uttarakhand, told the bench that the stay on construction activities should be vacated so that relief measures can be undertakenaslivesofpeopleare at risk. Theapexcourtwillnexthear thecaseonSeptember11when the Maharashtra government elaborates on its solid waste management plan. TheapexcourtonAugust31 had castigated some states and Union territories, including Maharashtra,MadhyaPradesh, Uttarakhand and Chandigarh, for their“pathetic” attitude in failing to frame the state policy underthe SolidWaste Management Rules 2016. Continued on Page 2
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