OPINION, P6 ECONOMY, P3 SUNIL JAIN MSP an inefficient way to support farmers, markets much better 'HISTORIC MOVE' COUNTERING COVID Breaking up BigTech a bad idea, US House panel report ignores consumer welfare & tech progress ASHOK GULATI ECONOMY, P2 Modi launches property-card scheme to aid rural households ‘Feluda paper strip test could be rolled out in next few weeks’ NEW DELHI, MONDAY, OCTOBER 12, 2020 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL. XLVI NO. 192, 14 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 Delhi exempts road tax on battery-run vehicles THE DELHI GOVERNMENT has exempted road tax on battery-operated vehicles under its new Electric Vehicle Policy, Transport Minister Kailash Gahlot said on Sunday, reports PTI. ■ Full-time employment vacancies gaining pace THE MOMENTUM IN the job marketmayhavelostsomepace inSeptemberbutthegoodnews is that 93% of the 1.76 lakh positionsfilledwerepermanent ones. Full-time hirings numbered 1.64 lakh comparedwith 1.5 lakh in June, according to data from Xpheno. Employment levels have now moved back all the way to 75% of preCovidlevels,according to Nicolas Dumoulin, MD, Michael Page India. Page told FE themainreasonforthis is that with companies re-aligning themselves with the new normal, there has been a need for new talent.Also,companies have understood the current conditions will continue for some time.“There’s less uncertainty and that has led to more hiring,” Dumoulin explained. Employers who were earlier considering more nonpermanent roles, part-time assignments, internships, contractual and also remoteworking roles, seem to be more open now to full-time positions. The count of remote working options, for instance, fell to below 2,000 in September from 6,000 in May. As Kamal Karanth, co- ■ 93% of 1.76 lakh openings were for full-time positions in September ■ Full-time positions up from 1.50 lakh in June to 1.64 lakh in September ■ Festive season demand likely to spur hiring further Firms stick to trend and meet 30% of FY21capex target in H1; H2 promising as Centre raises annual target by 50% to `7.3 lakh crore In H1, CPSEs/ departmental undertakings spend `1.5 lakh cr for capital investments, Coal India meets 50% of annual target PSE Capex PRASANTA SAHU New Delhi, October 11 ILLUSTRATION: ROHNIT PHORE founder, Xpheno observed the trend seems to be in favour of full-time roles. “As we go further into Unlock 5.0 in October one should expect the numbers to climb further,” Karanth said. Aditya Narayan Mishra, CEO, CIEL HR Services, said his firm has started recruiting for a host of sectors — manufacturing, engineering and industrials — where jobs have been non-existent for the better part of the year. Continued on Page 2 (` lakh crore) LARGE CENTRAL PUBLICSECTOR entities—companies and undertakings — achieved 30% of their capital expenditure (capex) target for FY21 in the first half of the financial year, by spending almost `1.5 lakh crore,according to official sources. This is a creditable achievement,as it reflects that these companies have managed to hold on to the capex pace shown in recent years in thefirsthalf,despitetheCovid19 shock. In the last few years, CPSE capex has remained robust; the ratio of capex deployment between the first and second halves of a financial year has been 3:7. Of course, the Centre is putting extra pressure on these entities to speed up capital investments in the current year as it hopes that the slippages on the other 3.8 7.3 4.4 4.4 4.4 FY21^ SHUBHRA TANDON Mumbai, October 11 FY20 THE CENTRE ON Sunday said about 37.92 lakh tonne of kharif paddy worth `7,159.39 crore has been purchased at the minimum support price (MSP) from 3.22 lakh farmers in the last 15 days, reports PTI. Paddy procurement commenced in Punjab and Haryana from September 26, while in other states from October 1. CPSEs keep normal capex pace intact Permanent job options on rise FY19 Govt buys 37.92 LT kharif paddy at MSP in last 15 days COVID TIMES FY18 POWER PRODUCERS' TOTAL dues owed by distribution firms rose over 37% year-on-year to `1.33 lakh crore in August 2020, reflecting stress in the sector, reports PTI. Distribution companies (discoms) owed a total of `96,963 crore to power generation firms in August 2019, according to portal PRAAPTI. IT'S OFFICIAL FY17 IN THE NEWS Discoms' dues to gencos rise 37% to `1.33L cr in Aug Data of CPSEs and departmental undertakings with annual capex of minimum `500 crore ^Finance ministry has revised target to 150% of original estimate of `4.9 lakh crore investors, including the central and state governments will be offset to a certain extent by the CPSEs/undertakings. The Union finance ministry has already told CPSEs/undertakings that they must achieve 150% of the initial capex target of `4.9 lakh crore in FY21. However,this is going to be a daunting task for these entities.With little additional budget support expected,theywill have to scale up borrowings to augment capex. In a market already over-crowded with higher government borrowings, this would prove to be a costly affair. “The government wants CPSEs to increase capex in the current financial year to boost economic activity,” an official said. More than 80% of the capex by these CPSEs and departmental units usually comes from their own surpluses and loanswhile the balance funds are provided from the Union Budget. While most entities were trailing the finance ministry’s target of 50% of annual target in H1FY21, Coal India was an exception by achieving a little over 50% of its capex plan of `10,000 crore for FY21 in April-September. Among the undertakings, the Railways has the largest investment plan in FY21 with capex target of `1.6 lakh crore, followed by the NHAI (`1.1 lakh crore), ONGC (`32,502 crore)andIOC(`26,233crore). Continued on Page 2 COVID INFECTIONS Are fresh cases on the decline? As states test more with RAT, positivity declines 30-day average 1,60,000 1,20,000 Watches: Awaiting a turnaround As losses pile up, wristwatch manufacturers bet on gifting during the festive season to drive sales ■ eFE, P8 Adopting AI to level up Back-to-back policy-level initiatives focus on developments in Artificial Intelligence in India ■ PERSONAL FINANCE, P9 Should you invest in NFO? Consider investing in an NFO only if it will invest in an entirely new category or sector or geography ■ INFRASTRUCTURE, P11 Rationalise levy of stamp duty Differing and unclear methods to assess duty across states hinder investment prospects in the mining sector ■ SCIENCE & TECH, P12 The world from above Musk, Bezos, and Zuckerberg have their eyes set on the sky, but they need to fight with stargazers 30 15 13.8 -30 Core exports* Total goods exports -45 -60 INDIA INC IS expected to have staged a fairly good recovery in the September quarter after profits plunged 83% year-onyear in Q1FY21, a quarter in which India’s GDP contracted 23.5%y-o-y. The numbers must be viewed against the high base of Q2FY20 when corporate tax rateswere cut. 15,000 0.0 0 0 2017 2018 2019 5.3 57.5 -1.3 (E) 2020 Source: Kotak Institutional Equities estimates Activity data suggest the economy is on the mend and that the recovery is somewhat fasterthan anticipated. Auto sales, railway freight and manufacturing PMI all reflectedanuptickinactivityin September after a slower pick- Jun -21.4 Mar Dec Jun Sep Mar Dec Jun Sep Mar -20 Sep -10 60 50 40 Feb 9 Mar 22 May 31 Jul 26 Oct 4 Source: Google, Apple, CMIE, Bloomberg & Nomura Global Economics up in July and August. Exports reboundedinSeptember,rising 5.3% y-o-y reversing the negative12.7%y-o-yslideinAugust; analysts said exports were back atcloseto98%ofnormallevels. However, subdued domestic demandleftcoreimportsweak. Aug 11- Sept 11Sept 11 Oct 11 ON OCTOBER 11, India recorded 74,383 infections, andthecountryhadconducted 10,78,544 tests. Over the last twoweeks,starting September 23, India has been conducting more tests, but the daily infections have been falling. Thecountry’spositivityrate —dailycasesupondailytests— which was once trending at a highof12.6%onSeptember7, has come down to 6.9%. Continued on Page 2 70 1.9 July 11Aug 11 ISHAAN GERA New Delhi, October 11 70.3 1.0 0 Gujarat Testing trends reveals that heavy RAT influence may be depressing the numbers tion of workers from key cities like Surat disrupted operations of most jewellers. This hurt overall merchandise exports. Exports of rice jumped by more than 92% in September to $346 million,while those of drugs and pharmaceuticals surged by 24.4% to $439 million. These two were the best performing export segments last month.Even core imports were down by only 12.8%, year-on-year, in September to $21.8 billion,comparedwith a 19.6% fall in overall goods imports to $30.3 billion. 80 10 5.6 Business activity was better in August than in July though the sequential pace of the improvement slowed slightly acrosstheboardandtherewasa drop in the industrial sector. Continued on Page 2 New Delhi 5 Sept 11Oct 11 30,000 1.5 -75 Mar 2019 Sept 2020 *Goods, excluding petroleum and gems & jewellery August/September data based on quick/preliminary estimates of the commerce ministry Nomura India Business Resumption Index July 11- Aug 11Aug 11 Sept 11 2.1 3.0 82.1 82.9 100 90 20 Dec FE BUREAU Mumbai,October 11 30 6.3 3 20,000 India Inc to see mild recovery,but miles to go BSE-30 Index earnings growth (%) 0 40,000 Q2FY21 EARNINGS SEASON An adverse base effect and a poor show by consumption-driven sectors would be a drag on profits 0 July 11- Aug 11- Sept 11Aug 11 Sept 11 Oct 11 7 7.8 45,000 11.1 11.6 15,000 2 60,000 11.4 0 -15 1.1 3 9 30,000 4.5 (% change, y-o-y) DEFYING EXTERNAL HEADWINDS and a Covid-induced gloom, India’s ‘core’ exports that reflect the economy’s competitiveness, grewat their fastest pace in 18 months in September. This suggests a gradual return towards normalcy and brightening of the prospect of an early recovery. The outbound shipment of core products — goods excluding petroleum and gems & jewellery — grew 11.1%,yearon-year,inSeptemberto$21.1 billion, reversing a 3.2% decline in the previous month, according to a preliminary estimate of the commerce ministry. This was double the pace of expansion recorded in February, when Covid-19 was yet to take roots in India. Meanwhile, overall goods exports grew just 5.3% in Septemberto$27.4billion,against a12.7%contractioninAugust, as per the data from the Directorate General of Commercial Intelligence and Statistics. Gems and jewellery exports have collpased this fiscal, as a pan-Indialockdownandmigra- 6 6.0 Fresh pick-up BANIKINKAR PATTANAYAK New Delhi, October 11 Delhi 8.4 60,000 80,000 Exports of ‘core’ items gather pace ■ BRANDWAGON, P10 45,000 40,000 RECOVERY AFOOT FE SPECIALS Positivity rate (%) RHS 60,000 12 9 8.8 80,000 0 No of daily tests Bihar Telangana 1 12 9 6 5.3 3.8 3 July 11- Aug 11- Sept 11Aug 11 Sept 11 Oct 11 0 India’s recovery conundrum ON SUNDAY, India had sevenstateswitharecovery rateofover90%.Thecountryalsorecordedoneofthe highest recovery rates in the world with a recovery rate of 86.2%.Dailyrecoveries have been outstripping daily confirmed infections for over three weeks now. ■ Page 2 While this may indicate a slowing down of infection in the country, as India prepares for its second wave, careful analysis of testing data across states shows otherwise. Continued on Page 2
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