OPINION, P6 COMPANIES, P4 BIBEK DEBROY The productivity of state legislatures has been quite poor INTERNATIONAL, P8 EDITORIAL TRUMP TARIFFS FRESH APPROACH Sebi's Franklin Templeton ruling a defining moment, underscores importance of due diligence by AMCs JSW Steel sues top US competitors for metal ‘conspiracy’ Biden revokes TikTok, WeChat bans; security review to continue HYDERABAD, THURSDAY, JUNE 10, 2021 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOLUME XVII NO. 340, 14 PAGES, `6.00 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: 51,941.64 ▼ 333.93 NIFTY: 15,635.35 ▼ 104.75 NIKKEI 225: 28,860.80 ▼ 102.76 HANG SENG: 28,742.63 ▼ 38.75 `/$: 72.98 ▼ 0.09 `/€: 88.96 ▼ 0.22 BRENT: $72.66 ▲ $0.44 GOLD: `48,736 ▼ `121 DESPITE THE pandemicinduced lockdown and restrictions on mobility in large parts of the country, highway construction grew by 74% on year in April-May of the current financial year to 1,470 km or 24.1 km a day. Of course, the sharp y-o-y growth is on a low base (14.1 km/dayinApril-May 2021), but even in comparison to April-May 2020 (28.2 km a day),theperformancesofstatesector highway builders were creditable in the first two months of the current fiscal. Thelatesthighwayconstruction signals that the construction sector of the economy, which posted a recovery with 14.5% growth in gross value added (GVA) in Q4FY21, may somewhat retain the momentum in Q1 this fiscal. The sector,which is not facinganyfundsconstraintsasprojects being implemented are HDFC HAS sold certain pledged shares of Reliance Capital worth `16 crore in the secondary market sale through stock exchanges, the company said on Wednesday, reports PTI. HDFC has invoked the pledge on certain shares of Reliance Capital through Axis Trustee Services. Ready to talk, says agri minister; farmers unmoved AGRICULTURE MINISTER Narendra Singh Tomar on Wednesday expressed readiness to resume talks with protesting farmers to resolve their objections to the agri laws, but the unions remained adamant on their demands, reports PTI. Special Features Asus ZenBook Duo: Powerful dual-screen wonder Starting at `129,990, Asus ZenBook Duo is a feature-rich laptop with high-quality build, top-notch design and powerful specs. A good combination of speed, efficiency and power ■ Gadgets, P7 PC industry’s record breaking sales will continue in 2021 Technologies like cloud, 5G and AI play a critical role as we look to the future of computing, says Meghana Patwardhan, vice-president, Dell Latitude & Mobility Products, Dell Technologies ■ eFE, P7 QuickPicks Will appoint chief compliance officer in a week: Twitter to govt SOCIAL MEDIA platform Twitter is learnt to have written to the government that it is in advanced stages of finalising a chief compliance officer as per the new IT rules and additional details will be submitted to the government within a week, according to an official source, reports PTI. Twitter, in its reply to the final notice of the government dated June 5, said it is making all efforts to comply with the new norms but has been unable to do so because of the global impact of the pandemic. PAGE 5 Revenue deficit grant: Finmin releases `9,871 cr to 17 states THE FINANCE ministry on Wednesday said it has released the third monthly instalment of revenue deficit grant of `9,871 crore to 17 states, reports PTI. With the release of this instalment, total `29,613 crore has been released in the first three months of the current fiscal to states. The Department of Expenditure on Tuesday released the third monthly instalment of Post Devolution Revenue Deficit (PDRD) Grant of `9,871 crore for the year 2021-22 to 17 states, the ministry said in a statement. PAGE 2 IndiGo hopes to reach pre-Covid level traffic by Q2 of 2022: CEO INDIGO IS hoping to reach pre-Covid level of overall traffic, both domestic and international, by the second quarter of next year, its CEO Ronojoy Dutta said on Wednesday, reports PTI. The carrier is currently operating around 40% and 30% of its pre-Covid domestic and international flights, respectively, and it does not plan to lay off any employees this year, Dutta said. In July last year, India's largest carrier had laid off 10% of its workforce due to the coronavirus-induced economic crisis. Awards Construction 1,692 1,470 747 847 663 241 FY20 FY21 FY22 Hike in MSPs of various Kharif crops in 2021-22 (By three government agencies, MoRTH, NHAI and NHIDC; Source: MoRTH) 0 COVID PRODUCTS WTO to begin talks on patent waiver US, EU soften stance on proposal initiated by India and South Africa 2020-21 2021-22 1 10 5 28.1 2019-20 20 1 15 FE BUREAU New Delhi, June 9 THE CABINET ON Wednesday announced a modest year-onyear increase of 1-7% in the benchmark prices of over a dozen summer-sown crops for the year starting July.The move reflectsthegovernment’sintent to keep inflationary pressure in check at a time when it needs themonetarypolicycommittee to retain its accommodative stanceforlongtospurgrowthin 2018-19 25 BANIKINKAR PATTANAYAK New Delhi, June 9 Paddy the aftermath of the pandemic. The modest hike will likely upset farmers, many of whom (especially from Punjab and Haryana) have been protesting against the new farm laws for over six months now.But agricultureministerNarendraSingh Tomar stressed the MSPs of all Kharifcropsarestillatleast50% Tur 4.9 3.8 Highway awards and construction (Apr-May, in km) 30 2 SURYA SARATHI RAY New Delhi, June 9 1-7% 9.9 HDFC invokes Rel Capital shares worth `16 crore Even as farm law protests continue, crop procurement remains robust, Punjab farmers key beneficiaries 4.1 3.6 5.2 Construction at 24.1 km a day in April-May, up from 14 km/day a year ago (% change in MSP/quintal, y-o-y) 4.1 2.2 3.4 5 INDIA'S EXPORTS grew by 52.39% to $7.71 billion during the first week of this month on account of healthy growth in shipments in sectors including engineering, gems and jewellery and petroleum products, according to preliminary data of the commerce ministry, reports PTI. Modest hike in Kharif MSPs to curb inflation 12.9 Highways being built at brisk pace despite pandemic AGRI PUSH 3.7 2.9 3.9 ROADSHOW IN THE NEWS Exports up 52.4% to $7.71 billion during June 1-7 Groundnut Cotton* *Medium staple higher than their full paid-out costs (A2+FL).In 2018,the year in which the cost-linked norm wasintroducedaheadofthelast generalelectionstoensurefarmers get 50% over the paid-out costs,the hikes were more dramatic—intherangeof50-97%. Continued on Page 2 AFTER STIFF RESISTANCE from rich nations, members of the World Trade Organization (WTO) on Wednesday unanimously agreed to initiate granular, text-based negotiations for a patent waiver proposal initiated by India and South Africa,in a significant step towards fighting the Covid-19 pandemic. The proposal,first submitted in Octoberlastyear,sought patent waivers to manufacture Covid-related medical products by temporarily sus- ■ TheTRIPS ■ The proposal waiver is had earlierfaced necessary to stiff opposition removing IP from developed barriers and members, including paving the US and way for EU more firms to produce Covid vaccines pending certain parts of the global Trade-Related Aspects of Intellectual PropertyRights (TRIPS) agreement. Continued on Page 2 Vaccines, front-loading of fiscal steps to spur growth: Finmin Continued on Page 13 Peer review of Covaxin Ph-3 trials in Q4 THE FINANCE MINISTRY on Wednesday said rapid vaccination and frontloading of the fiscalmeasuresplannedintheFY22Budgethold the key to invigorating the investment, and thereby consumption, cycle in the coming quarters,reports feBureauin NewDelhi. Initslatestmonthlyreportontheeconomy, thedepartmentofeconomicaffairssaidaswit- almost totally governmentfundedviatheengineeringprocurement and construction (EPC) contracts or the hybrid annuitymodel (HAM),is clearly one of the most unaffected by the lockdown. BHARATBIOTECH,which is yet to publish the data of its Covid-19 vaccine Covaxin phase-3 trials, expects a peer review of the jab in 2-4 months after it was given to scientific journals, Raches Ella project lead, Covid-19 nessedintheMarchquarter,where“growthin capex generated positive spill-overs for consumption, including in the contact-sensitive sectors, these steps would facilitate recovery post the second wave”.“Quickening the pace and coverage of vaccination is critical to help India heal and regain the momentum of economic recovery,” it added.■ Report on Page 2 DEAL UNDONE FE BUREAU New Delhi, June 9 SCRAPPED APLANNED$2.5-BILLIONdeal between Tellurian Inc and India’s largest gas importer PetronetLNGhasfallenthrough as the US-based firm hasn’t made any request to continue interactions after December 2020, Petronet MD and CEO Akshay Kumar Singh said on Wednesday. “The (Tellurian) MoU has not been extended”, Singh said,adding“as on today there is no MoU between us”. On September 21, 2019, whenPrimeMinisterNarendra Modi met CEOs of 17 global energy firms at Houston, US, TellurianandPetronetLNGhad signed an MoU to form a joint venture,with Petronet investing $2.5 billion in Tellurian’s DriftwoodLNGexportterminal in the US in exchange for the rights to 5 million tonnes per annum (MTPA) of LNG supply over 40 years. Global markets have changed considerably Modi's US visit in Sept 2019, Tellurian and Petronet LNG signed an MoU under which the latter was to invest ■ During PM $2.5 bn in the US firm's Driftwood LNG export terminal vaccines, at Bharat Biotech said on Wednesday, reports PTI.In a series of tweets,Ella said there were nine publications on Covaxin so far and the efficacy paper of phase-3 trials would be the 10th one. ● JAYPEE INFRA Mkt value of Yamuna E-way higher than liquidation value: NBCC Petronet-Tellurian’s $2.5-bn pact shelved ■ In return, Petronetwas offered right to 5 mtpa RISHI RANJAN KALA New Delhi, June 9 ofLNG supplies over 40 years ■ The two firms have abandoned the plan as global markets have changed, gas availability & supply have risen MONSOON IN MUMBAI Stranded local train commuters walk on waterlogged railway tracks at Kurla in Mumbai on Wednesday. The year’s first monsoon rains caused severe waterlogging in various parts of the city Stocking up since the signing of the nonbinding MoU,and analysts feel the firms are not keen on investments in such projects anymore because of higher gas availabilityand supply. Continued on Page 2 GAILsplit plan junked, to monetise pipelines A PROPOSAL to bifurcate GAIL (India) has been scrappedfornow,anditwillinstead monetise some of its pipelines by selling a minority stake through an InvIT, reports PTI. GAIL CMD Manoj Jain said the company has The proposal sought patent waivers to make Covid-related medical products by temporarily suspending some parts of TRIPS pact sent a plan for monetising two of its pipelines to the petroleum ministry and an Infrastructure Investment Trust(InvIT)ispossiblewithin the current fiscal if approvals come soon. ■ Page 4 AGENCIES Inflows into equity MFs hit 14-month high Equity mutual funds witnessed a net inflow of over `10,000 crore in May, making it the highest infusion in 14 months due to rally in stock markets on the back of declining Covid19 cases and robust quarterly earnings. This also marks the third consecutive monthly inflow, data from the Association of Mutual Funds in India (Amfi) showed. Net equity inﬂows (` crore) 10,083 9,115 10,000 5,000 3,437 0 -5,000 -10,000 -4,534 -9,253 Jan 2021 Feb March April May NBCC, IN A letter to the committee of creditors (CoC) of Jaypee Infratech (JIL) on Wednesday, said the fair market value (FMV) of Yamuna Expressway is higher than the liquidation value projected. The state-run company emphasisedassentingfinancial creditors(AFCs)canrealiseupto `4,000 crore for the 90% stake inthee-waySPVbeingofferedto them as part of the insolvency resolution process. JIL’s CoC meet on Thursday (June 10) to deliberate on the revised resolution plans of NBCC and the consortium led by Suraksha Realty as well as decide on the voting process foracquisition of the bankrupt real estate developer. Sources said the lender’s panel on Monday (June 7) had soughtclarificationfromNBCC ontherationalebehinditsoffer toAFCsanddissentingfinancial creditors(DFCs).ThePSUreplied that according to the interim resolution professional’s (IRP) letterlastmonth,theliquidation value (LV) of Yamuna Expresswayis `3,458 crore. Continued on Page 13 ● A HARD LINE ADDING TO THE CART US Senate passes bill to G7 nations devise way to catch Amazon in tax net tackle China tech threat than10%,thethresholdsetasa criteriaforcompaniesonthelist. ButbecauseitsAmazonWebServices business has a margin of over 30%, Amazon as a whole canbeincluded,theofficialstold Reuters.Talks on a global minimum corporate tax agreed by theG7richnationsonJune5are runningparalleltotalksonhow to divide the rights to tax excess profits,those which can be considered routine,of the 100 biggest,mostprofitablefirms. REUTERS Paris, June 9 G7STATESHAVEfoundawayto include Amazon, one of the world’s biggest companies,on a listof100settofacehighertaxes in the countries where they do business by targeting its more profitablecloudcomputingunit, officialsclosetothetalkssaid. Some European countries had concerns Amazon may fall outofscopeoftheproposednew rules because its overall operating margin as a company is less ILLUSTRATION: ROHNIT PHORE Continued on Page 13 REUTERS Washington, June 9 THE US SENATE voted 68-32 on Tuesday to approve a sweepingpackageoflegislation intended to boost the country’s ability to compete with Chinese technology. An indignant China responded to thevote bysaying it objected to being cast as an “imaginary”US enemy. The desire for a hard line in dealingswithChinaisoneofthe fewbipartisansentimentsinthe deeply divided US Congress, which is narrowlycontrolled by President Joe Biden’s fellow Democrats. The measure authorises about $190 billion for provisions to strengthen US technology and research — and would separately approve spending $54 billion to increase US production and research intosemiconductorsandtelecommunications equipment. Continued on Page 13 HYDERABAD
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