OPINION, P6 COMPANIES, P4 TV RAMACHANDRAN India must incentivise data exchange, not mandate it INTERNATIONAL, P8 EDITORIAL COURT FILE AGGRESSIVE APPROACH Get real on GST: Centre must yield on proclivity for cesses, states on compensation demand UBHL offers to settle `14,518-cr liabilities with 14-bank consortium US Fed Reserve adopts average inflation target, elevates focus on jobs NEW DELHI, FRIDAY, AUGUST 28, 2020 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL. XLVI NO. 154, 30 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: 39,113.47 ▲ 39.55 NIFTY: 11,559.25 ▲ 9.65 NIKKEI 225: 23,208.86 ▼ 82 HANG SENG: 25,281.15 ▼ 210.64 `/$: 73.82 ▲ 0.48 `/€: 87.38 ▲ 0.41 BRENT: $45.43 ▼ $0.21 GOLD: `51,234 ▲ `216 our instruments or ammunition,” Das said, adding,“What the MPC (monetary policy committee) resolution says and what I have said in my MPC minutes and what the other members of the MPC have also said is that the decision of the MPC was to keep the gunpowder dry.” Continued on Page 2 There are not many requests from corporates for a loan recast. There will be some requests for recast from the personal segment and we are readying ourselves for dealing with the volume as far as the P-segment is concerned. —RAJNEESH KUMAR , SBI CHAIRMAN ● MAKE IN INDIA ● PAYROLL Self-reliance in defence sector EPFO says June to boost global standing: PM data on par with pre-crisis level, but rejig raises questions PRESS TRUST OF INDIA New Delhi, August 27 WOOING FOREIGN PLAYERS to join his push for defence manufacturing in India, Prime MinisterNarendraModisaidon Thursday that producing defence equipment is the best optionforthemconsideringthebig size of its market and underscored the government’s commitment to create a robust ecosystem forall manufacturers. Addressing a seminar on ‘Aatmanirbhar Bharat’ in defence manufacturing, Modi said his government has usheredina“win-win”situationfor all players,from public sectorto SURYA SARATHI RAY New Delhi, August 27 private and foreign manufacturers, and asserted that the concept of a self-reliant India is not“inward-looking”.Heasserted that the import embargo on anumberofdefenceequipment is not only aimed at curbing imports but also giving a boost to the domesticindustry. Continued on Page 18 Special Feature ‘Efficacy, not pricing, is key for skincare products’ The Body Shop's Shriti Malhotra says the beauty brand will continue launching stores across India, while enhancing its online presence with tech-enabled offerings ■ BrandWagon, P9 QuickPicks NET ADDITION TO the Employees Provident Fund (EPF) subscriber base marginally overshot the monthly average of 2019-20 in June 2020 (see chart), indicating a sharp and resilient recovery after hitting the nadir in April, official figures put out by the retirement body show. However,even as these figuresaretreatedasproxyofjobs created (rather,they represent the pace of formalisation of jobs), the fact that the EPFO undertakes frequent and drastic revisions of the data make them appear less foolproof, if not suspect. Forexample,theApril2020 payroll addition was first reported in June at 1.33 lakh, butwas revised to a little overa lakh in July and further to just 20,164 in the latest revision. Similar volatility has always marred the credibility of EPF payroll data, which the body started releasing on a monthly basis effective April 2018. Horse-mounted policemen at Girgaum Chowpatty in Mumbai on Thursday. The mounted unit will be deployed at prominent beaches to ensure there in no crowding at Ganesh immersion points GST SHORTFALL States told to borrow under special window Two options: Borrow only `97,000 cr or raise entire `2.3 lakh cr to bridge shortfall; debt servicing via extended cess Finance minister Nirmala Sitharaman at the 41st GST Council meeting via video conferencing, in New Delhi on Thursday FE BUREAU New Delhi, August 27 THE CENTRE ON Thursday presented two options before the states to bridge their estimated goods and services tax (GST)revenueshortfallof`2.35 lakhcrore(aftertakingintoconsideration the compensation cessfund)inFY21,bothinvolving the states themselves borrowing from the market in the year.The loans will be serviced via the proceeds of the relevant compensation cess,which will apply on the specified demerit goodsforayearormorebeyond the current end date of FY22. The options,as finance secretary Ajay Bhushan Pandey explainedtoreportersafterthe 41st GST Council meeting here, are the following: 1) States borrow `97,000 crore, which is the estimated shortfall, only “on account of GST” PAG to pick up 51% stake in Edelweiss Wealth for `2,200 cr ALTERNATIVE AMC Pacific Alliance Group (PAG) will pick a 51% stake in Edelweiss Wealth Management for `2,200 crore, reports fe Bureau in Mumbai. The investment will close after customary regulatory approvals. Following the investment, Edelweiss Wealth Management demerger and listing on stock exchanges is expected in the coming 12 to 18 months. PAGE 4 21,465 (` crore) 25,806 (excess) 69,858 (excess) FY18 2,35,000 (shortfall) FY19 (shortfall) FY20 FY21 (E) Compensation paid (required) Cess revenue under a special window to be facilitatedinconsultationwith the Reserve Bank of India (RBI) at a ‘reasonable G Sec-linked interest rate’; 2) they borrow the entire `2.35 lakh crore. TheCentre’sreasoningisthe extradeficitof`1.38lakhcrore isduetotheimpactofCovid-19 on the economy, which, as finance minister Nirmala Sitharaman put it, is an “extraordinary Act of God situation”. The states have been asked to conveytheirchoicetotheCouncil in sevenworking days. Continued on Page 2 Real estate FE BUREAU Stocks go through the roof on stamp duty cut Realty stocks on Thursday were in huge demand, rising up to 15%, following the Maharashtra government's decision to reduce the stamp duty to 2% till December, saying the move will foster demand creation and give a boost to the allied industries DLF Godrej Properties (Intra-day on BSE, `) 185 (Intra-day on BSE, `) 940 175.95 177 909.95 925 910 169 153 145 162.70 884 880 Previous close: 160.05 865 Open Close 850 Prestige Estates (Intra-day on BSE, `) 400 (Intra-day on BSE, `) 270 397.95 256 Open 393 385 Previous close: 849.95 Close 380 375 259.80 263 390 895 161 Oberoi Realty 395 Previous close: 367.50 Open Close 249 242 235 241.75 Previous close: 240.40 Open Close Continued on Page 2 Prepare ‘monitoring mechanism’ ● SBI LOANS for individual IRPs: DFS to banks Insolvency proceedings THE DEPARTMENT of financial services (DFS) has asked banks to put in place a mechanism to monitor cases which could require initiation of individual insolvency proceedings against personal guarantors in corporate loans, reports Ankur Mishra in Mumbai. DFS has asked them to consider setting up an IT system to collate such data. PAGE 10 Yawning deﬁcit 3,00,000 —SHAKTIKANTA DAS RBI GOVERNOR HORSE PATROL 65,000 THE RESERVE BANK of India (RBI)hasnotexhausteditspolicy options by front-loading repo rate cuts and it continues tohave enoughinstrumentsto battle the challenges brought upon by Covid-19, governor Shaktikanta Das said on Thursday. At the same time, Das reiterated the importance of winding down the regulatoryforbearance being offered in view of the pandemic as soonasitseffectstartstowane. “The first thing Iwould like to say is that we have not exhausted our policy options, whether it relates to the rate cut orwhetherit relates to any other aspect of central banking. We have not exhausted FE BUREAU New Delhi, August 27 1,65,302 RELIANCE RETAIL'S ONLINE grocery shopping portal JioMart has warned of fake websites seeking franchisees in its name, reports PTI. JioMart said it is not operating any dealership or franchisee model at present. FE BUREAU Mumbai, August 27 Post containment of Covid-19, the financial sector should return to normal functioning without relying on the regulatory relaxations and other measures as the new norm. 95,444 Reliance Retail warns of fake JioMart websites Look at attracting sector-specific global investors, unlocking value for the current shareholders 69,275 INDIAN STATE REFINERS have stopped buying crude oil from China-linked companies, three sources said, after New Delhi’s recent regulation aimed at restricting imports from countries that it shares a border with, reports Reuters. State refiners have been inserting a clause in their import tenders on new rules restricting dealings with companies from countries sharing a border with India. Governor reiterates importance of winding down regulatory forbearance in a timely fashion GMR to list airports as separate entity RBI hasn’t exhausted its ammunition: Das 95,081 State-run refiners halt oil imports from Chinese firms REJIG PLAN 41,146 REGISTERING OVER 75,000 Covid cases for the first time in a span of 24 hours, India's virus tally sprinted past 33 lakh on Thursday, while recoveries crossed the 25-lakh mark, reports PTI. A record 75,760 infections were added in a day taking the total caseload to 33,10,234. Death toll climbed to 60,472. COVID WAR 62,611 IN THE NEWS India sees highest single-day spike of 75,760 Covid cases THE BOARD OF GMR Infrastructure (GIL) on Thursday approved a corporate restructuring exercise that will see the flagship infrastructure firm retain only the airport business listed as a separate entity. The remaining verticals — energy, EPC and urban infrastructure — will be carved out and housed in GMR Power and Urban Infra (GPUIL). At present, both GPUIL and GMR Power Infra, that housed the energy business, are units of GIL. Post the demerger, GIL will emerge as the country’s only pure-play listed airports company. The company currently runs airports in Delhi and Hyderabad and, in early July, had divested a 49% stake in the airports business to the Paris-based Groupe ADP. Ademergerwouldfacilitate the entryof strategic investors and help the group pare debt currently at close to `28,150 crore,analysts said.GMRInfra ended FY20with consolidated revenues of `8,555 crore, an ebitda 2,629 crore and a net lossof`2,202crore.Ithasbeen reporting losses since FY15. In Q1FY21, the company ON THE RUNWAY Non-airport business to be split into GMR Power and Urban Infra Both GMR Power and Urban Infra to have same shareholding as GMR Infra Post rejig, GMR Infra to be a pure-play listed airports company Restructuring to help attract sector-specific global investors Separate listing of airport, non-airport units to help simplify corp holding structure posted a loss of `834 crore on revenues of `1,006 crore,a fall of 44% y-o-y with business disrupted by the pandmemic. The scheme creates a mirror shareholding of GIL in GPUIL with all existing shareholders of GIL becoming shareholders of GPUIL in the same proportion. The scheme envisages the issueofoneadditionalshare,of `5 each,of GPUIL for every 10 shares held in GILof `1 each as on the record date. Continued on Page 2 CCI PROBE Flipkart moves SC against NCLAT order FE BUREAU New Delhi, August 27 IN WHAT MAY lead to a long drawn legal battle, Walmartowned Flipkart has moved the SupremeCourtchallengingthe National Company Law Appellate Tribunal’s (NCLAT) March orderwhich directed the Competition Commission of India (CCI) to launch a probe against the e-commerce firm on alleged charges of abuse of dominant position. The NCLAT had ordered a probe after setting aside the CCI’s 2018 order which had absolved Flipkart of such allegations levelled by the All India Online Vendors’ Association (AIOVA). TheAIOVAhadfiledacaveat in March itself in the Supreme Court,anticipatingthatFlipkart maymovetoapexcourtatsome stage.Thismeansthatwhenthe SC decides to hear the case, it would have to listen to the case put forward byAIOVA. BothFlipkartandAIOVAdid not respond to FE’s queries on Thursday. The NCLATorderwas based on a January 2019 plea by AIOVA urging it to “set aside” CASE FILE May 2018 AIOVAmoves CCI, seeks probe into Flipkart’s discriminatory business practices November CCI: ‘Flipkart not dominant in relevant market ofservices provided by e-marketplaces’ January 2019 AIOVAfiles a petition with the NCLAT, asking it to set aside CCI’s impugned order March 2020 NCLATorders CCI to investigate Flipkart the CCI’s order absolving Flipkart of abusing its dominant position.The orders of CCI can be challenged in the NCLAT. Continued on Page 2 LAND BANK against Anil Ambani halted Investors can grab over a fifth of mapped 4.2L ha FE BUREAU New Delhi, August 27 PRESS TRUST OF INDIA New Delhi, August 27 THE DELHI HIGH Court on Thursdayput on hold the insolvency resolution process proceedings against RCom chairman Anil Ambani in relation to recovery of `1,200 crore loans given by State Bank of India to histwofirms.Ambanihadgiven personal guarantees for the `565 crore and `635 crore SBI loans to RCom and Reliance Infratel (RITL), respectively, in August 2016. Anil Ambani A bench of justices Vipin Sanghi and Rajnish Bhatnagar also restrained Ambani from “transferring,alienating,encumbering or disposing of assets orlegalrightsandintereststhereintillthenextdateofhearing”. Continued on Page 18 INVESTORS SITTING IN the comfort of their couches can now zero in on land located in various states forpotential projects,withcommerceandindustry minister Piyush Goyal elaunching a first-of-its kind GIS-enablednationallandbank portal on Thursday.As much as 4.2 lakh hectares has been mappedacross3,275industrial clustersinthecountry,ofwhich about1.13lakhhectaresisavail- Industrial belts (Land availability, in ha) Bharuch (Gujarat) 23,006 Jagatsinghpur (Odisha) 12,256 8,600 7,679 6,057 NIMZ (Odisha) Cuddalore (TN) EPIP-Ganjimutta (K'taka) Jamnagar (Gujarat) Dahej (Gujarat) Walunj (Maha) 2,225 1,556 1,422 ableforinvestors,asthegovernment looks to lure them at a time when anti-China senti- Source: DPIIT Dashboard ments are growing globally. Investors will be able to not just locate the land but have New Delhi access to a plethora of details — logistics,land,rail & airconnectivity, tax incentives, drainage system,power supply and even raw material availability — so that they can make informed decisions about the industrial belt.Forinstance,the engineering and auto hub of Gujarat’s Sanand,where 904 hectares is available, four 66/11 kilovolt substations are operational for power supply and another underplanning. Continued on Page 18
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