ECONOMY, P2 COMPANIES, P4 INTERNATIONAL, P3 India, Singapore ink semiconductor deal Gupshup focusing on emerging markets Putin: India, China, Brazil could be peace mediators MUMBAI, FRIDAY, SEPTEMBER 6, 2024 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL LXIV NO. 213, 46 PAGES, `12.00 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: 82,201.19 ▼ 151.45 NIFTY: 25,145.10 ▼ 53.60 NIKKEI 225: 36,657.09 ▼ 390.52 HANG SENG: 17,444.30 ▼ 13.04 `/$: 83.98 ▼ 0.01 `/€: 93.18 ▼ 0.35 BRENT: $73.16 ▲ $0.46 GOLD: `71590 ▲ `586 IN THE NEWS RIL BOARD NOD TO 1:1 BONUS SHARE ISSUE AFTER 7 YRS RELIANCE INDUSTRIES (RIL) on Thursday said its board has approved bonus issue in the ratio of 1:1 in the first such issue in seven years, reports Raghavendra Kamath. The company will reveal the record date for the issue separately. This is the sixth bonus issue by the group, after in 2017-2018, 2009-2010, 1997-1998, 19831984 and 1980-1981. ■ PAGE 4 FM ASKS INDUSTRY TO UTILISE SCHEMES & EXPAND CAPACITY FINANCE MINISTER NIRMALA Sitharaman on Thursday gently nudged Indian industries to invest to expand their capacity to serve the growing needs of India by taking advantage of the government’s employment- and productionlinked incentives and the corporate tax rate cut since 2019, reports fe Bureau. ■ PAGE 2 MAHARASHTRA CLEARS PROJECTS WORTH `1.17 L CR THE MAHARASHTRA CABINET subcommittee, chaired by chief minister Eknath Shinde, on Thursday approved four major projects with a total investment of `1.17 lakh crore. These projects, spread across Marathwada, Vidarbha and Pune, focus on semiconductor and EV manufacturing and are expected to generate 29,000 jobs. ■ PAGE 10 FE S P E C I A L Strategy vs tactics: Beyond lip service How can brands honour Paralympians authentically? ■ BRANDWAGON, P9 CAR INVENTORY LEVEL RISES TO 780,000 UNITS Dealers sound fresh alarm on high stock Manufacturers dispute claim, say it’s at 420,000 SWARAJ BAGGONKAR Mumbai, September 5 THE FEDERATION OF Automobile Dealers Association (FADA) on Thursday said that passenger vehicle inventory at the end of August has reached an alarming level,with stock days now stretching to 70-75 days and inventory totalling 780,000 vehicles, valued at a staggering `77,800 crore. The numbers in both volume andvalueterms are7%higherthan July,indicating that dealers’request to car manufacturers to calibrate dispatches have gone unheeded. “Rather than responding to the situation,passengervehicle manufacturers continue to increase dispatches to dealers on a month-onmonth basis, further exacerbating the issue,” FADA president Manish RECORD STOCKPILE ■ Vehicle manufacturers FE spoke to say they are responsible players and are adhering to a month’s inventory ■ FADA Maruti Suzuki claims it has brought down inventory days to 36 at the start of September ■ FADA says if this aggressive push continues, retail ecosystem could face severe disruption ■ Raj Singhania said in a statement. He added that dealers must act swiftly to stop taking additional stock to protect their financial health.“If this aggressive push of excess stock continues unchecked, the auto retail ecosystem could face severe disruption,”Singhania said. However, PV manufacturers do not agree with the scenario being depicted by FADA. Manufacturers told Fe that the maximum possible inventory within the system could advises dealers to act swiftly and stop taking additional stock to save their financial health be 415,000-420,000 units, which is around 5-6 weeks (35-40 days). “Going by bank inventory limit which is around `45,000 crore, some cash-credit limits,some letter of credit and bank guarantees, etc, the maximum value of inventory would be around `51,000 crore with the average vehicle price at around `12-13 lakh,” an industry executive said. Continued on Page 7 Goyal for border adjustment tax to blunt import edge MUKESH JAGOTA New Delhi, September 5 COMMERCEAND INDUSTRY minister Piyush Goyal on Thursday floated the idea of a border adjustment tax (BAT) to address the price disadvantages being faced by local companies against imported products due to multiple local taxes. BAT is a tax that is imposed on imports in addition to basic custom duties. It seeks to offset the extent of taxes that local producers pay,so that the import tariffs are real. “BorderadjustmenttaxisaWorld Trade Organization-compliant mechanism. If all industry associationslikeCII,FicciandAssochamcan takeupthisidea,wemaybeinapositiontogaintractionandgetBATinto the country. BAT can even be imposed on imports from countries withwhichthecountryhasfreetrade agreements,” he said at Indian Steel Alliance’s (ISA)‘Steel Conclave’here. The minister also assured domestic steelmakers, which are facing a margin squeeze due to influxofcheapimportsofsteel,that theirconcernswouldbeaddressed. “We are with you and (will do) whatever it takes to get the steel industry rocking, help India grow, add new jobs...,”he said. OnWednesday,Unionsteelminister H D Kumaraswamy had said that he would try to convince the PIYUSH GOYAL, COMMERCE AND INDUSTRY MINISTER WE ARE WITH DOMESTIC STEELMAKERS AND (WILL DO) WHATEVER ITTAKES TO GETTHE STEEL INDUSTRY ROCKING, HELP INDIA GROW, ADD NEWJOBS finance ministry to raise duties on steelimportsto10-12%from7.5% at present. He also expressed concernsonthemannerinwhichChina was“dumping steel into India.” Elaborating on BAT, Goyal said, “Imports,even from FTAcountries, may have to be (subjected to local levies such as) electricity duty, coal cess,oranyadditional state levies or taxesthat (domesticindustry) is not getting relief from.” The WTO allows BAT if it is applied equallyto imports and similar domestic products,while sticking to stancewhile exportsare zerorated,theyshouldnotbesubsidised. Goyalnotedthattheearliermove on BAT did not succeed, but said it could be explored again. The steel industry is facing a lot of duties and cesses including royalties and other taxesonironoredutiesandcoalcess while dealingwith surging imports. Goyal said Japanese and Korean companiespreferdomesticallyproduced steel even if it costs them more,“whereas sadly many friends in our industry don’t have a similar approach”. Continued on Page 7 INDIA’S GAIN IS CHINA’S LOSS In Amazon cart: $5 billion of small-ticket exports in 2024 MANOJ KUMAR New Delhi, September 5 GREAT INDIAN DEALS AMAZON PLANS TO export about $5 billion of small-ticket items from India thisyear,upfrom nearly$3billionin2023,supplyingmarketssuch as the United States and Britain, a company official said, marking a shift away from China. The move by one of the world’s largest e-commerce companies underscoresIndia’sgrowingroleinthe global supply chain and reflects a broader trend among multinational corporations to diversify sourcing awayfrom China. Walmart plans to hike its supplies from India to $10 billion a year by 2027, up from about $3 billion in 2020. “India is naturally one of the largest sources of selection for Amazon,” Bhupen Wakankar, director of globaltradeatAmazon,toldReutersin an interviewonThursday. He said Amazon had partnered with India’s commerce ministry and trade associations to connect with thousands of small manufacturers across the country,offering products from textiles and jewellery to household items and ayurveda products. Suchitemsareusuallyeasytopost directly to customers abroad and less move reflects a broader trend among MNCs to diversify sourcing away from China ■ Amazon's ■ Export items from India include textiles, jewellery and ayurveda products ■ Walmart ■ Amazon plans to increase its investments in India to $26 billion by 2030 affected byimport taxes than costlier products.“We are investing significantlyintoolsandtechnologiestohelp sellers optimise their reach, enhance productdiscovery,andincreasesales,” he said,ahead of an exporters’meeting.Amazon and Walmart’s Flipkart havereshapedIndia’sretaillandscape in recent years, investing billions of dollars to source supplies from small businesses and attracting consumers through heftydiscounts. But they face criticism from trading and political groups.India’s commerce minister has accused Amazon and other e-commerce companies of predatory pricing practices and said ● SEBI INSIDERS TRADE CHARGES also plans to hike its supplies from India to $10 billion a year by 2027, up from about $3 billion in 2020 the sector’s rapid rise should not disrupt millions of brick-and-mortar stores operating in the country. Last June, Amazon announced plans to increase its investments in India to $26 billion by 2030, including funds for its cloud business. Through the Global Selling Programme, initiated in 2015,Amazon has enabled about 150,000 small Indianexporterstosellroughly$8billion worth of products directly to overseas consumers by the end of 2023,Wakankar said.The company aimstofacilitate$20billionincumulativee-commerceexportsfromIndia by2025,he added. — REUTERS A day after the Securities and Exchange Board of India (Sebi) talked about “external influence” behind allegations of a toxic work culture, the regulator’s officers staged a protest outside the headquarters on Thursday to seek the resignation of chairperson Madhabi Puri Buch and withdrawal of the statement. Senior regulatory officials are reportedly in talks to resolve the issue. Report on Page 6 AMIT CHAKRAVARTY PAC may summon Buch to review Sebi performance House panel notifies agenda amid calls by Opposition for probe LIZ MATHEW New Delhi, September 5 THE PUBLICACCOUNTSCommittee (PAC),the parliamentarywatchdog for government spending, has decided to include in its agenda for the year a review of the performance of the Securities and Exchange Board of India (Sebi), whose chairperson Madhabi Puri Buch is at the centre of a political firestorm following allegations levelled against her by USbased Hindenburg Research. Sources said the parliamentary panel,whichhasnotifieditsagenda, islikelytosummonBuchduringthe review process. The PAC, headed by Congress leader K C Venugopal, took the unusual step to include a suo motu subject — performance review of regulatorybodies established by Act of Parlia- Sebi chairperson Madhabi Puri Buch ment—atitslastmeetingonAugust 29.Theagendafortheyearwasnotified earlier this week. This comes amid the growing Opposition chorus for a parliamentary probe into Hindenburg Research’s allegation that Buch and herhusband,DhavalBuch,had“stake in obscure offshore entities used in Adani moneysiphoning scandal”. In response to the allegations made by Hindenburg, a joint statement byBuch and herhusband said that “the investment in the fund referred to in the Hindenburg reportwasmadein2015whenthey were both private citizens living in Singaporeandalmost2yearsbefore Madhabi joined Sebi, even as a whole time member”. Continued on Page 7 Probe fresher onboarding delays at Infosys: Centre to Karnataka PADMINI DHRUVARAJ Bengaluru, September 5 IN THE CROSSHAIRS THE UNION LABOUR ministry has directedtheKarnatakaauthoritiesto look into the delays in onboarding freshersbyInfosysandtakeappropriateactionunderrelevantlabourlaws, eventhoughthetechgianthasstarted sending joining dates to those awaitingappointmentletterssince2022. The labour ministry’s directive to state labour commissioner’s office follows a complaint by IT union Nascent Information Technology Employees Senate (NITES). Infosys has delayed onboarding of 2,000 candidates who were attributed to industry-wide hiring freeze, precipitated by fears of a recession in major markets ■ Delay in onboarding selected for system engineer and digitalspecialistengineerrolesduring the 2022-23 recruitment drive. The NITES had previously accused Infosys of “ongoing ■ Earlier this week, Infosys issued more than 1,000 appointment letters ■Nearly 700 campus hires from the 2022 batch still await their joining dates exploitation and unprofessional treatment” of these young engineering graduates. Continued on Page 7 India growth story remains intact, says RBI governor Centre steps up MSP purchases of pulses, onion India to top China in key emerging markets index DESPITETHE GDPgrowthinthe Junequarterfallingbelowexpectations, India’s growth story remains intact, Reserve Bank of India(RBI)governorShaktikanta Das said on Thursday, reports Sachin Kumar. He emphasised that reforms like GST and IBC,and the flexible inflation targetingframeworkhaveyieldedlong-termpositive outcomes.“These reforms need to be augmented by reforms in land, labour and agricultural markets,”he added. ■ Page 6 TO BOOST CULTIVATION of kharif crops,especially pulses and maize,in 76 tribal districts across 12 states, the National Cooperative Consumers’ Federation of India (NCCF), an agency under the department of consumer affairs,is entering into contracts with farmers for assured purchase of the commodities at the minimum support price (MSP), reports Sandip Das. Also, the agency would purchase onion at market rates for the benefit of farmers. ■ Page 2 INDIA COULD SOON overtake China as the most influential in a key emerging markets index, pulling in more foreign funds and addingfueltoastockmarketrallythat,though already among the best globally, is “only past the halfway mark”, Morgan Stanley said, reportsReuters.India’sweightageintheMSCI emerging markets index rose to 19.8% after a rejig in August, closing in on China’s 24.2%. India’s weightage has steadily increased from 9.2% in December 2020. ■ Page 10