OPINION, P6 COMPANIES, P4 K SRINATH REDDY & SARIT ROUT NHA FY18 shows India moving fast towards a still distant target INTERNATIONAL, P8 EDITORIAL TECH TALK COMPETITION CONCERN Headline Q2 numbers mask weaknesses; PFCE growth still modest, slow construction, trade a drag Twitter’s new CEO joins club of India-born US tech captains UK antitrust watchdog orders Facebook owner Meta to sell Giphy CHENNAI/KOCHI, WEDNESDAY, DECEMBER 1, 2021 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL XLIII NO. 175, 16 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: 57,064.87 ▼ 195.71 NIFTY: 16,983.20 ▼ 70.75 NIKKEI 225: 27,821.76 ▼ 462.16 HANG SENG: 23,475.26 ▼ 376.98 `/$: 75.17 ▼ 0.08 `/€: 85.41 ▼ 0.66 BRENT: $70.97 ▼ $2.47 GOLD: `48,031 ▲ `67 IN THE NEWS Fiscal deficit at just 36% of FY22 BE in Apr-Oct ROBUST REVENUES HELPED the Centre to contain its fiscal deficit in the first seven months of of the current fiscal at just 36.3% of the BE, causing analysts to predict that the annual target might not be exceeded, reports fe Bureau in New Delhi. The corresponding figures for the comparable periods in FY21 and FY20 were 119.7% and 102.4%, respectively. Double-digit growth likely in FY22: CEA INDIA’S RECOVERY REMAINED robust in Q2 and the economy will likely grow in double digits in the current fiscal, CEA Krishnamurthy V Subramanian said, reports fe Bureau in New Delhi. He projected real growth to remain in the range of 6.5% to 7% in FY23 and over 7% thereafter. SC says can't wait 'forever' for Vijay Mallya THE SUPREME COURT said it can't wait “forever” for fugitive industrialist Vijay Mallya and fixed January 18 as final date for hearing sentence against him in the 2017 contempt case, reports Indu Bhan in New Delhi. MODEST RECOVERY REVISITING RULES ● TAX NET Trai to review India GDP grows reserve pricing at 8.4% in Q2 for spectrum FE BUREAU New Delhi, November 30 Consultation paper for fixing reserve price across 10 bands, including 5G FE BUREAU New Delhi, November 30 THE TELECOM REGULATORY Authority of India (Trai) on Tuesday hinted that the methodology of valuation of spectrum and thereafter fixing the reservepriceforauctionsmaybe revised fromwhat has been followed so far. Further, components like upfront payment to be made by the operators for spectrum acquired in auctions, themoratoriumperiod,thenumber of installments for deferred payment and spectrum cap mayalso be reviewed.Areas likeblocksize,spectrumsurrender and spectrum assignment forprivatenetworksmayalsobe analysed in a fresh perspective. Trai has flagged all these issues on Tuesday in its consultation paper,which is aimed at fixing the reserve price of spectrum spread across 10 bands, including600MHzandthemillimetre band for 5G services.In the process, the quantum of Auction to be conducted in 10 spectrum bands Moratorium period, upfront payment and deferred payment installments may be changed as spectrum tenure extended to 30 years ■ Pricing methodology may change in view ofrecent reforms, changed dynamics of telecom sector Issues around private 5G networks will be deliberated ■ Suggestions sought for creating provisions for surrender ofspectrum Spectrum for space communications left out for the upcoming sale INDIA'S GROSS DOMESTIC product (GDP) expanded at 8.4% on year in the September quarter,asvalueadditionacross sectors picked up moderately and help came from a favourable base (-7.4%), according to data released bythe National StatisticalOffice(NSO)onTuesday.Unlessthenewcoronavirus variant Omicron plays havoc, theeconomymayremainonthe path of recovery through the second half,and the GDP could reach the pre-pandemic (FY20) level in the current fiscal itself. Persistentlyelevatedlevelof ‘core’inflation remains a threat totherecoveryprocess.Companies, facing pressure on margins,could increasingly pass on GDP (% change, y-o-y) 20 8.4 10 5.4 Continued on Page 2 20 -20 -30 Q1FY20 Q2FY22 How they stack up (% chg in GVA, y-o-y, Q2FY22) Manufacturing Construction Financial services, etc Public administration, etc 60 40 0 -10 spectrum,which maybe put up forauctions nextyear,would be the largest so far and if the reserve price is not fixed realistically,thegovernmentrunsthe riskofonceagainfindingnotakersforalargeamountofairwaves, which was the case in the March auctionsand in 2016. the input cost increases to the consumersinthecomingquarters.Though the RBI is likely to keepthepolicyratesunchanged in the bimonthly review next week,it mayhave to start tightening the monetary policy by earlynextfiscal,giventhelikelihoodofrisinginflationarypressures. That said, GDP in both nominal and real term remained higherby12.4% and 0.3%, respectively in Q2FY22, thaninthesameperiodinFY20 (pre-pandemiclevel). In Q2FY22, private consumption,the principal constituentoftheeconomywas,however, 3.5% below the Q2FY20 level,whilefixedinvestmentjust returned to the pre-Covid level, whichwasa dismal period. 5.5 7.5 7.8 17.4 Continued on Page 15 (% change, y-o-y) Govt consumption Pvt consumption Investment 13.3 0 -20 7.6 1.8 11 8.6 8.7 -40 -60 Q1FY20 Source: MoSPI Q2FY22 ● CHIP CRUNCH No separate Maruti flags decline in provision December production but I-T rules SHIVANI SINGH 30 Bengaluru, November cover crypto MARUTI SUZUKI INDIA said at two of its manufacturing income: FM onTuesdayvehicle production 80-85% locations in the country could Vehicle production at two ofits plants could be around FE BUREAU New Delhi, November 30 FINANCE MINISTER NIRMALA SitharamanonTuesdaysaidno separate section orprovisionin the Income-tax Act, 1961, currentlydealsspecificallywiththe rate,applicabilityandcollection of tax on the income earned by cryptocurrency exchanges and other platforms that provide such services. Nevertheless, extant statutory provisions clearly envisage that total income for the purpose of taxation will include entire income from all sources, according to her reply in the Rajya Sabha.“The income earned by crypto exchanges and other crypto service providing platforms is liable to tax under the head Business orProfession underChapter-IVoftheIncome taxAct,1961.Applicabilityoftax rate will depend on status and categoryof taxpayer,” She said. The statement comes amid media reports that the government is planning to amend the income tax laws to bring cryptocurrencies underthe tax net, withsomechangesexpectedas early as the next Budget. Continued on Page 2 be around 80% to 85% of normal capacity in December due to the ongoing semiconductor shortages.The carmakersaid it expects the crunch’s adverse impact on total vehicle production volumes in Haryana and at its contract manufacturing company in Gujarat. The latest outputwarning is ofnormal capacity ■ Latest production warning is the third one in less than six months the third one in less than six months,with Maruti flagging similar falls in September and October. — REUTERS QuickPicks Shriram founder R Thyagarajan steps down, to mentor SOT board PUTTING IN place a succession plan, the Chennaiheadquartered Shriram Group on Tuesday announced the formation of a board of management to drive the long-term vision and strategy for the group, reports fe Bureau in Chennai. Stepping aside from a formal role, group’s founder R Thyagarajan will now mentor the board of management, with the new leadership in place. P4 Companies raise record `36,720 cr through IPOs in November NINE COMPANIES have raised a record `36,720 crore through initial public offerings in November, which is the highest single month fundraise seen in a decade, reports fe Bureau in Mumbai. The largest IPO to hit the market during the month was Paytm. During the previous IPO boom in November 2017, `18,824 crore was raised, as per data from Prime Database. P9 CHENNAI/KOCHI