OPINION, P6 NATION, P5 EDITORIAL Monetary policy should continue to support growth HEALTHCARE INFRA BIG INVESTMENT Allow public sector banks to bid for the NUE licence, they are lagging the pvt banks on tech RENU KOHLI BACK PAGE, P18 MoS Karad asks medical fraternity to avail `50k-cr loan scheme UAE to liberalise laws to to stimulate economy, says minister Touq NEW DELHI, MONDAY, SEPTEMBER 6, 2021 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL. XLVII NO. 161, 18 PAGES, `8.00 (PATNA `8.00, RAIPUR `8.00) 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 Continued on Page 2 CHOPPY WATERS Over the long term, govt may offer tax incentives to set up shipping lines in India Incentives for container manufacturing also on the cards PRASANTA SAHU New Delhi, September 5 ■ BRANDWAGON, P9 Changing the frequency Radio broadcasters are rolling out digital solutions to make up for the decline in advertising revenue ■ eFE, P17 India & cloud adoption By leveraging cloud capabilities, firms have been able to drive innovations, says Google’s Bikram Singh Bedi ■ PERSONAL FINANCE, P8 New norms for bank lockers Banks can only obtain from customers a time deposit that covers 3 years’ rent and charges for breaking open the locker ■ INFRASTRUCTURE, P10 Execution vital to success of NMP The Centre will need to strike a fine balance between public and private interests while recycling asset inventory ■ SCIENCE & TECH, P7 The antibodies question Subtle differences have emerged in the antibody-responses of Pfizer and Moderna shots Global firms relocating from China under the PLI scheme need to move their supply chain units also Govt's policy does not encourage China-based supply chain units to relocate to India ■ This acts as a major hurdle for firms as building new ancillary units takes a long time The issue was creating a major problem in the IT hardware sector where selected firms had approached the govt ■ In IT hardware PLI incentive structure is low at 2-2.5% With nil import duties firms saw no benefit of relocating to India hadrecentlyrepresentedtothe government,issues relating to localisation in the PLI among others. Continued on Page 2 ■ Govt likely to extend incentive scheme IFLADP for leather, footwear industry till 2025-26, Page 3 States’ capex growth remains high, even on rising base STATE GOVERNMENTS’ CAPITALexpenditurehasremained robust in the first four months of the current financial year even as the advantage of low base has begun to peter out. Data gathered by FE of 14 major states shows that these states reported combined capexof`76,616croreinAprilJulyof FY22,up 110% on year. Continued on Page 2 States’ finances* FY22 net direct tax receipts up 95% (April-July, growth %, y-o-y) 150 100 110 95 50 0 -50 -100 15 2 8 FY21 FY22 -4 34 1 -28 Borrowings FE SPECIALS PRAGMATIC APPROACH CAPITAL FORMATION *Of 14 major states reviewed by FE THE UNION government’s net (post-refunds) direct taxcollectionsrose95%on year to `3.7 lakh crore till September2 of the current financial year, thanks to a low base, a pick-up in economic activities, higher corporate earnings and better compliance,reports Prasanta Sahu. ■ Page 2 CLOSING CALL Volunteers hold national flags of participating nations during the closing ceremony of the Tokyo 2020 Paralympic Games on Sunday REUTERS ● MAHAPANCHAYAT Farmers congregate to protest farm laws RECOVERY ROAD Aug hiring up 26% on surge in full-time jobs PRESS TRUST OF INDIA Lucknow/Muzaffarnagar, September 5 THOUSANDS OF FARMERS from UP and neighbouring states on Sunday gathered at Muzaffarnagar for a ‘Kisan mahapanchayat’aimed at‘saving the country’, just months ahead of the UPassemblypolls. The eventwas organised bythe Samyukt Kisan Morcha (SKM) at the Government Inter College ground in Muzaffarnagar in protest against the Centre's controversial farm laws. "These meetings will be held across the country. We have to stop the country from gettingsold.Farmersshouldbe saved, the country should be saved; business, employees and youth should be saved-this is the aim of the rally,”BKU national spokesperson Rakesh Tikait said. Continued on Page 2 ILLUSTRATION: ROHNIT PHORE SHUBHRATANDON Mumbai, September 5 WITH MOST PARTS of the countryemerging from a lockdown, hiring in August was brisk,rising 26%year-on-year to 2.78 lakh.The numbers may have been a shade softer than in July — 4% lower — but HR consultants believe there’s no cause for concern given the recruitment trajectory remains positive. The good news is that full time opportunities con- ● CROP INSURANCE Centre rethinking Beed formula PRABHUDATTA MISHRA & NANDA KASABE New Delhi/Pune, September 5 AFTER OFFERINGTHE so-call 'Beedformula'asanalternative model in crop insurance to retain the states'participation, the Centre is now reconsideringthe80-110plan,giventhat somestateshavestartedsecuring refunds of major shares of the gross premiums collectively paid by the Centre and states. The Centre apprehends that the state governments "80-110" plan under PMFBY during kharif 2020 (` crore) Gross premium State subsidy Claims* Beed district, Maharashtra 110.8 Foreign portfolio investors (FPIs) were net buyers to the tune of `16,459 crore in Indian markets in August, with majority of investment coming in the debt segment, reports PTI. Estimated domestic shipping services market in FY21; state-run SCI caters for <5% Tax revenues Annual surge in shipping costs in August REALISINGTHATTHE production-linked incentive (PLI) schemeswillnotmoveforward if China-based ancillary firms and executives are not allowed seamless access to the country, the government has assured theindustrythatitwillexpedite approvalswhereverrequiredon a case-by-case basis. Though the assurance has been given by the ministry of electronics and ITto the hardware industryexecutives,who had made a representation to the government in this regard,sources said that other administrative ministries will also take a similar approach. This softening of approach towards China-based ancillary units would also help in finalising PLI guidelines for the auto and auto component sector, which has been hanging fire for long. The IT hardware industry 71.9 >300% $60-65 bn Fiscal aid, extension of a transport scheme for farm exporters being weighed for fast relief KIRAN RATHEE New Delhi, September 5 155.9 WORRIED ABOUT AN over 300% jump in shipping costs in August from a year before, the government is exploring a range of options--including incentivising the setting up of domestic shipping lines and temporary fiscal support — to soften the blow to exporters. The crisis hits exporters at a time when they are striving to reapbenefitsofaresurgencein global demand for merchandise, and threatens the coun- MeitY assures industry that supply chains won't be disrupted, other ministries to follow suit Revenue expenditure Total expenditure FPIs net buyers in Aug; invest `16,459 crore BANIKINKAR PATTANAYAK New Delhi, September 5 try’s ambitious $400-billion export target for FY22. SourcestoldFEthatthegovernment is weighing both short-termandlong-termmeasures,andafinaldecisionwillbe made soon. For immediate relief,it’sconsideringdemands to extend fiscal support to Covid-hitexportersforthenext 6-7monthstobolstertheirability to honour supply commitments on time.Forexporters of specified farm products, it’s planning to re-introduce the TransportandMarketingAssistance(TMA)schemeforatleast one more year.Under theTMA, which was valid for two years through March 2021, the governmentreimbursedexporters a certain portion of freight charges and offered assistance forthemarketingofselectagricultural produce. 13.5 Revival of the Indian economy would be sustained if the Covid-19 pandemic is under control, eminent economist Shashanka Bhide said on Sunday, adding that prioritising expenditure to get maximum employment and income effects while controlling the pandemic are necessary in the short term, reports PTI. TMA scheme to be reintroduced; tax relief and other sops likely for large players setting up shipping lines in India Chinese firms to be let in Capex -49 Revival to sustain if Covid is under control: Bhide Sops to soften shipping cost blow PLI SCHEMES 405.7 The government's collections from levy of excise duty on petroleum products have jumped 48% in the first four months of the current fiscal year, with the incremental mop-up being 3-times of the repayment liability of legacy oil bonds in the full fiscal, official data showed, reports PTI. BOOSTING EXPORTS 798.1 IN THE NEWS Excise collection from fuel jumps 48% in Apr-Jul Tamil Nadu *As on August 16, 2021; *In the case of Beed, more than 78% of the gross premium (including the Centre's share) or 153% of the premium paid by Maharashtra govt will be returned to the state; *As for TN, the state will get back 10% of gross premium, or 22% of the premium paid by the state and insurers are acting in concert to understate the insurance claims by the farmers. The formula, also known as 80-110 plan, is a win-win for states and insurers as the former gets large premium refunds – as high as 153% of the premium paid bythe state government in Maharashtra's Beed district in the current kharif season, for instance – and the insurers get assured return of 20% of the gross premium. Continued on Page 2 SHOW TIME Films may run for less time in theatres, get on to OTT faster FE BUREAU Mumbai, September 5 WITH CINEMA THEATRES taking longer to open than expected earlier and audiences not really flocking to them in droves, negotiations between stakeholders overthe length of the window for theatrical releases – most recentlyseen forThalaivi – are becoming intense.One industryinsidertold FE‘windowdiscussions are breaking down’in the sense that there are no rules anymore. “Every producer is negotiating his own terms with exhibitors,” the person said. PVR cinemas has said it will reduce the theatrical window by half to 4 weeks for the near future. Although most states are allowing a 50% occupancy for theatres, there is some hesitancy on the part of viewers; especially those above 40 and typically buying high-priced tickets. What this means is that producerswould remain open to releasing theirfilms directly on OTT platforms. “If box office collections aren’t likely to be as good as might have been expected — Bell Bottom didn’t fare toowell —we could see more deals being struck for streaming platforms,”another film industry insider observed. Viewership numbers for OTT platforms of the order of 300 million — as put out by some tracking agencies — appearatrifleexaggerated.But experts are convinced the number of OTT viewers could well have crossed 100 million with the number of paid subscriptions at far lower at around 30-35 million. Continued on Page 2 New Delhi tributed to 94% of the overall active jobs. Indeed, the sharp increase y-o-y is significant since August 2020 was the recovery month last year after a weak JuneandJuly.Thelowestaction months on record are June and July 2020, with 1.32 lakh and 1.42 lakh active jobs respectively, according to data sourced from Xpheno, a Bengaluru-based specialist staffing firm. Continued on Page 2
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