OPINION, P6 MARKETS, P9 INTERNATIONAL, P8 EDITORIAL G-SAP OMO ON THE ROAD RBI says second tranche of bond purchase worth `35,000 cr on May 20 Musk says Tesla to roll out improved self-driving tech in coming weeks Sebi’s‘person in control’rule in keeping with changing India Inc Differing expert voices on plasma therapy, ivermectin show the need for scientific consensus in informing policy NEW DELHI, THURSDAY, MAY 13, 2021 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL. XLVII NO. 62, 16 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: 48,690.80 ▼ 471.01 NIFTY: 14,696.50 ▼ 154.25 NIKKEI 225: 28,147.51 ▼ 461.08 HANG SENG: 28,231.04 ▲ 217.23 `/$: 73.43 ▼ 0.08 `/€: 89.10 ▲ 0.12 BRENT: $69.39 ▲ $0.84 GOLD FUTURE: `47,643 ▲ `10 IN THE NEWS PM Modi reviews oxygen, medicine availability THE SUPPLY OF oxygen is now over three times of what it was during the peak of the first Covid wave, the Prime Minister's Office said on Wednesday, reports PTI. It noted that production of all drugs, including Remdesivir, has been ramped up significantly in the last few weeks as India battles the nationwide surge in infections. Cairn commences output from tight oil project in Raj VEDANTA'S CAIRN OIL & Gas on Wednesday said it has commenced oil production from NA #01 facility in Aishwariya Barmer Hills in Rajasthan, reports PTI. “The project is a first in Cairn's tight oil portfolio with a growth potential to contribute 20% to the company's vision production," it said. Jaypee insolvency: Financial creditors’ meet on May 15 JAYPEE INFRATECH’S LENDERS and homebuyers will meet on May 15 to discuss the revised bids submitted by NBCC and Suraksha, reports PTI. JIL informed that a committee of creditors’ meet will be held on May 15. DONE DEAL Cadila arm to sell animal health unit for `2,921 cr PRESS TRUST OF INDIA New Delhi, May 12 CADILA HEALTHCARE ON Wednesday said its whollyowned subsidiary Zydus AnimalHealthandInvestmenthas enteredintodefinitivepactsfor sale of its animal healthcare establishedmarketsundertakingtoMultiplesAlternateAsset Management-led consortium for `2,921 crore. The consortium, including Canada Pension Plan Investment Board and RARE Enterprises, has agreed to purchase the undertaking through an special purpose vehicle (SPV) controlled by them, in the name of Zenex Animal Health India,CadilaHealthcare saidin a statement. Animal Healthcare Established Markets Undertaking (Zydus AH) is focused on India and certain other countries, the company added. The deal is to sell Animal Healthcare Established Markets Undertaking on a slump sale basis as a going concern, for a lump sum consideration of `2,921 crore on a cash-free and debt-free basis, subject to certain closing date adjustments and other conditions, Cadila Healthcare said. A short-lived blip? FE BUREAU Low base aids IIP to rise 22.4% in March Industrial output rose 22.4% in March, driven mainly by a very favourable base (it had shrunk 18.7% in March 2020 due to a lock-down) but also due to a mild pickup in activities before the second Covid wave hit the economy. The latest index was even lower than that in March, 2019. Retail inflation in April eased to 4.29% from 5.52% in March, as food inflation plunged to 2.02% from 4.87%. CPI IIP (% change, y-o-y) 8 40 -18.7 -80 Oct ’20 6 5 -40 -60 7.61 7 0 -20 7.22 22.4 20 (% change, y-o-y) -57.3 4 4.29 Apr ’20 3 March 2020 March 2021 April 2020 April 2021 The govt had said compararisions with IIP/CPI readings for MarchApril 2020 weren't proper due to a nation-wide a lockdown (from Mar 25 last year) Source: MoSPI QuickPicks February fall: Jio continues to lose active subscribers EVEN THOUGH Reliance Jio has added the maximum number of wireless subscribers in February, beating Bharti Airtel after six months, the company’s active user base continues to decline, with a loss of 0.2 million subscribers, reports Kiran Rathee in New Delhi. In November, when Jio had a 33.5% market share of active subscribers, marginally higher than Bharti Airtel’s 33.4%, the company has been lagging. PAGE 4 Change in control: Prior Sebi nod must for portfolio managers CAPITAL MARKETS regulator Sebi on Wednesday came out with a procedure for seeking its prior approval in case of change in control of portfolio managers, reports PTI. Under this, an online application needs to be made to the markets regulator for prior approval through the Sebi Intermediary Portal. The prior approval will be valid for six months. PAGE 9 OYO shifting to four-day work week, says CEO Ritesh Agarwal HOSPITALITY FIRM OYO will be shifting to a 4-day work week, OYO Founder and Group CEO Ritesh Agarwal said in a tweet on Wednesday, as the company also launched a no questions asked flexible infinite paid leaves initiative, reports PTI. Agarwal in a tweet noted that Covid-19 continues to test the physical and mental well-being of people. One thing that truly matters is having more time for our loved ones and ourselves, he said. ■ Cadila’s wholly-owned subsidiary Zydus Animal Health and Investment enters into definitive pacts for sale with a consortium ■ Multiples AlternateAsset Managementled consortium include Canada Pension Plan Investment Board, RARE Enterprises Purchase via a SPV controlled by consortium in the name of Zenex Animal Health India Zydus AH employs around 700 people and has one manufacturing facility in Haridwar Deal to be on slump sale basis as a going concern, for a lump sum consideration on a cash-free and debt-free basis LOW BIDS CABINET NOD Export target pruned from `2.45 lakh cr to `60,000 cr as firms submit low bids Apart from catalysing investment of `45,000 cr, the scheme seen to cut oil import bill by over `2 lakh cr in 5 years Output target halved for IT hardware PLI KIRAN RATHEE New Delhi, May 12 EVEN BEFORE IT gets operationalised,thegovernmenthas hadtocuttheoutputofitsproduction-linked incentive (PLI) scheme for IT hardware,which includeslaptops,tablets,all-inone PCs and servers, by half with manufacturers turning upwithlowbids.Asaresult,the utilisation of the outlay for the schemewillalsocomedownby a similar quantum and export targetswilltakeabighit—from `2.45 lakh crore over a fouryear period announced earlier to a mere `60,000 crore. IThardwaremanufacturers THE CENTRE IS all set to transfer over `19,000 crore to the bank accounts of more than 9.5 crore land-owning farmers under the income support ‘Pradhan Mantri Continued on Page 11 Hold GST Council meet soon, Mitra to Sitharaman FE BUREAU New Delhi, May 12 AMIT MITRA, WHO is in charge of the West Bengal finance department,has urged the Union finance minister Nirmala Sitharaman to urgently call a meeting of the GST Council to discuss a likely rise in states’ GST compensation need owing to the savage second Covid wave. “As per the Gol projection, theshortfallwasexpectedtobe to the tune of `1,56,164 crore in2021-22,withouttakinginto consideration the impact of Covid Wave-2. Now, due to Covid Wave-2 and lockdowns, thecompensationwillbemuch higherthanwhatwasprojected earlier. This is undoubtedly deeplydistressing,”Mitrawrote to Sitharaman.Under a unique arrangementinFY21,theCentre borrowed `1.1 lakh crore and transferred the amount to states to meet the shortfall in GST compensation cess. While Mitra expressed apprehension about the rise in shortfall, GST collections in April touched a record high of over `1.41 lakh crore.The GST revenues of April 2021 were 14% higher than `1.23 lakh crore collected in March. Original production target: Revised target: `1.60 `3.26 lakh cr lakh cr over four years over four years Original export target: Revised target: Reason for companies submitting low bids: Low incentive of average 2-2.5% over four years Original outlay: Outlay utilised: Does not justify relocating units from China as import duties on ITproducts is nil `2.45 lakh cr `7,350 cr `60,000 cr `3,675 cr blamethisonthelowincentive structure which works out to an average of 2-2.5% over a four-year period which does not justify relocating units from China or Vietnam, especially for hardware products, where import duties are nil as theyfallunderITproducts.The incentive structure for mobile phones PLI, which got operationalised in August 2020 and sawcompaniescommittingup to the maximum limit, works out to around 4.5% overa fiveyear period. Continued on Page 2 PM Kisan: `19,000 crore to reach farmers' accounts tomorrow Zydus AH employs around 700 people and has one manufacturingfacilityinHaridwar, it added. ● REVENUE SHORTFALL Failing to take off Kisan Samman Nidhi’ (PMKisan) scheme on Friday, reports fe Bureau in New Delhi.Thiswillbethehighest amount to be paid under the scheme on a single day. Farmers in West Bengal will get the PM-Kisan benefits for the first time if the state government provides the verified data of cultivatorsbyWednesday. ■ Page 2 THE CABINETON Wednesday approved a production-linked incentive (PLI) scheme for advanced chemistrycell (ACC) battery storage, which would cost the exchequer `18,100 crore over five years. Major battery-consuming sectors, including consumer electronics,electric vehicles,advanced electricity grids and solar rooftop,are expected to benefit from the move. The PLI scheme will draw direct investments of around `45,000 crore over five years and result in an annual import substitution of about `20,000 crore, information and broadcasting minister Prakash Javadekar said after the Cabinet meeting.The government also expects the scheme to potentially reduce the country’s oil import bill by `2,00,0002,50,000 crore (over five years), asincreasedACCstoragemanufacturing will promote greater `45,000 cr Investments inACC battery manufacturing `20,000 cr Annual import substitution 50ACC manufacturing GW facilities under the PLI scheme `2,50,000 cr Potentialdropinoil importsover5yearsdue tohigherEVadoptionfollowing increasedACCoutput adoptionof electricvehicles. Thelatestprogrammeispart of the 13 PLI schemes to lure mainly large corporations to expand manufacturing,bolster supplychainsandboostexports. Continued on Page 11 ‘Bharat Biotech refused to provide more doses to Delhi’ Govt’s vaccine spend in April at `4,400 cr Sisodia says Covaxin absence may severely hamper inoculation drive for 18-44 group PRASANTA SAHU New Delhi, May 12 PRESS TRUST OF INDIA New Delhi, May 12 DEPUTY CHIEF MINISTER Manish Sisodia onWednesday said Covaxin maker Bharat Biotech has refused to provide “additional” vaccine doses to the Delhi government,a development that is likely to severely hamper the inoculation drive forpeople in the 1844 age group.The stockof Covaxin in Delhi has finished as a result around 100vaccination centres set up in 17 schools have been closed,he said in an online press briefing. “The Covaxin manufacturer has in a letter said that it cannot provide the Delhi government vaccines due to unavailability, under instruction of government officials concerned. It means that the Bodies of people who died of Covid-19 are cremated at an open crematorium on the outskirts of Bengaluru on Wednesday central government is controlling supply of the vaccine,” Sisodia said. However, Lav Agarwal, joint secretary in the Union health ministry, on Tuesday denied that the Centre had any role to playinthepurchaseofvaccines by the states. Sisodia accused the Centre of vaccine mismanagement and reiterated that exporting6.5croredosestoforeign countries was the“biggest mistake”. The Delhi governmenthadordered67lakhdoses each of Covishield and Covaxin onApril26,Sisodiasaid.Accordingtothestategovernmentfigures, it has received 1.5 lakh Covaxin and 4 lakh Covishield doses so fartovaccinate people in the 18-44 age group. Continued on Page 2 WHO says variant found in India of global concern ‘Disheartening to see states questioning firm’s intention’ Vaccine paucity: Maha stops 18-44 age group vaccination THE B.1.617 VARIANT of Covid first identified in India last year has been found in 44 countries, says the WHO, which has classified it as a ‘variant of concern’, reports PTI. WHO has also characterised the lineage B.1.617 as a variant of concern. IT IS QUITE disheartening to listen to some states complaining about Bharat Biotech’s intentions regarding supply of Covaxin, joint MD Suchitra Ella said, reports PTI.In a tweet,Ella said the companyhasalreadydispatchedCovaxinlots to 18 states on May10. ■ Page 4 DUE TO THE acute shortage of vaccines in Maharashtra, the state government on Wednesday decided to temporarily suspend its drive to vaccinate people in the age group of 18 to 44 and divert the availablestockofdosesfortheabove-45 age group,reports PTI. US to remove Xiaomi from its blacklist Two parties agree to resolve ongoing litigation without further contest ■ Xiaomi rockets over 6% in Hong Kong as news of the decision spread ing to an end a brief and controversial spat between the hardware companyandWashington that had furthersoured THE CENTRE SPENT `4,400 crore, or 12.6%, of its FY22 Budget outlay of `35,000 crore for Covid vaccination in April, a senior official told FE. While it is too early to say whether additional allocation would be needed for the programme in this fiscal, given that states are also funding vaccination for people in the age group of 18-44 years, the cost to the central exchequer could be reined in, another official said. The Centre’s vaccination drive is continuing as planned earlier, providing free vaccination for essential and priority population as defined earlier (healthcare workers, frontline workers) and vaccination for people above 45 years of age at government facilities. The Centre will have at its disposal 50% of the vaccines being supplied by the manufacturers.The Centre has been procuring and passing on vaccines to the states as grants in kind and the actual administration of vaccines is being done by states. Continued on Page 11 ● CRYPTIC CRYPTO REVERSAL ROUTE THE US DEPARTMENT of defence will remove China's Xiaomi from a government blacklist,a court filing showed, markinga noteworthyreversal bythe Biden administration of oneofDonaldTrump'slastjabs at Beijing before exiting office. The filing stated that the two parties would agree to resolvetheirongoinglitigation withoutfurthercontest,bring- FE BUREAU New Delhi, May 12 EXPECTED BENEFITS COVID TRACKER Continued on Page 11 AAKRITI BHALLA & JOSH HORWITZ Bengaluru/Shanghai, May 12 `18k-cr PLI push to ACC battery storage Decision brings to an end a brief and controversial spat between the two ■ Its share price tumbled roughly 20% since it was placed on the blacklist in January Sino-US ties. A Xiaomi spokeswoman said the company is watching the latest developments closely,without elaborating. Shares in the company rocketed over 6% in Hong Kong as news of the decision spread. The company's share price has tumbled roughly 20% since itwas placed on the blacklist in Januaryin thewaning days of the Trump administration. Department of defence officials weren't immediately availableforcomment afterUS business hours. Continued on Page 2 SoftBank’s Son isn’t so sure about Bitcoin GEAROID REIDY May 12 SOFTBANK GROUP FOUNDER Masayoshi Son isn’t sure if Bitcoin is headed to the moon. Asked about the growing number of firms such asTesla that have invested in the cryptocurrency, Son was noncommittal. “There’s a lot of discussion over if it’s a good thing New Delhi or a bad thing,what’s the true value or is it in a bubble — honestly speaking, I don’t know,” Son said at the tech and investing giant’s earnings news conference. However, Sonaddedthatthepopularity of the cryptocurrencyhas made it into a platform that “can’t be ignored,” like diamonds orbonds,he said. Continued on Page 2
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