General Affairs
PM Narendra Modi Asks Officials To Analyse India's Position In 'Ease Of Doing Business' Report
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NEW DELHI: Amid disappointment in India, Prime Minister Narendra Modi today asked top officials in states and at the Centre to study the latest World Bank report which has ranked the country at 130th place out of 190 nations in 'Ease of Doing Business' and asked them to analyze areas requiring reforms and improvement.
He referred to the World Bank's report on 'Ease of Doing Business' during his monthly meeting of PRAGATI (Pro-Active Governance and Timely Implementation), an ICT-based platform where he interacts directly with top officials of states to discuss implementation of programmes and schemes.
While talking about various reforms, Modi said those should extend to all departments of the government.
"Mentioning the World Bank's latest Report on Ease of Doing Business, the Prime Minister asked all Chief Secretaries and all Secretaries of the Government of India to study the report, and analyze the potential areas where there is scope for improvement in their respective departments and states," a PMO statement said.
PM Modi asked for a report from all concerned in this regard within a month and asked the Cabinet Secretary to review the same thereafter, the statement added.
His remarks came amid disappointment in India over the country's low ranking, with Commerce and Industry Minister Nirmala Sitharaman saying the efforts and reforms undertaken by the Centre and states have not been adequately captured.
In the World Bank's latest 'Doing Business' 2017 report, India's place remained unchanged from last year's original ranking of 130 among the 190 economies that were assessed on various parameters. But the last year's ranking has been revised to 131 from which the country has improved its place by one spot.
He referred to the World Bank's report on 'Ease of Doing Business' during his monthly meeting of PRAGATI (Pro-Active Governance and Timely Implementation), an ICT-based platform where he interacts directly with top officials of states to discuss implementation of programmes and schemes.
While talking about various reforms, Modi said those should extend to all departments of the government.
PM Modi asked for a report from all concerned in this regard within a month and asked the Cabinet Secretary to review the same thereafter, the statement added.
His remarks came amid disappointment in India over the country's low ranking, with Commerce and Industry Minister Nirmala Sitharaman saying the efforts and reforms undertaken by the Centre and states have not been adequately captured.
In the World Bank's latest 'Doing Business' 2017 report, India's place remained unchanged from last year's original ranking of 130 among the 190 economies that were assessed on various parameters. But the last year's ranking has been revised to 131 from which the country has improved its place by one spot.
Armed Forces Protested Rank 'Downgrade', Overruled By Defence Ministry
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NEW DELHI: Strong objections from the armed forces, including a letter from the army in August, were overruled when the Defence Ministry recently announced the elevation of civilian officers in comparison with their military counterparts.
Defence Minister Manohar Parrikar, who signed off on a letter detailing changes in rank parity, was briefed by the government's top lawyer on the dispute today. A solution is expected in a day or two, say sources.
The army had said in its letter in August: "We are categorically objecting to the systematic downgrading of Defence Officers in status/equivalence vis a vis civilian officers."
But these concerns were rejected in the ministry's letter circulated a week ago.
According to the letter that has left the military seething, a principal director with the Armed Forces Civil Services, who was equivalent to a brigadier, will be at the same rank as a major general. A director-rank officer, earlier equated with a Colonel, will be ranked with a brigadier. A joint director will have the same rank as a Colonel, instead of Lieutenant Colonel.
Mr Parrikar on Tuesday said he would look into allegations that bureaucrats in his ministry attempted to downgrade the forces. "I will see and if I find any reduction in functional responsibilities - this is not status...some people are trying to misguide - they will be on same platform as earlier," he said.
In 2003, 2005 and 2008, the Army, Air Force and Navy had independently written to the Defense Ministry expressing the same concern. The ministry responded to each letter saying the changes were only functional and there was no change in rank, honour and respect for the armed forces.
Defence Minister Manohar Parrikar, who signed off on a letter detailing changes in rank parity, was briefed by the government's top lawyer on the dispute today. A solution is expected in a day or two, say sources.
The army had said in its letter in August: "We are categorically objecting to the systematic downgrading of Defence Officers in status/equivalence vis a vis civilian officers."
But these concerns were rejected in the ministry's letter circulated a week ago.
According to the letter that has left the military seething, a principal director with the Armed Forces Civil Services, who was equivalent to a brigadier, will be at the same rank as a major general. A director-rank officer, earlier equated with a Colonel, will be ranked with a brigadier. A joint director will have the same rank as a Colonel, instead of Lieutenant Colonel.
Mr Parrikar on Tuesday said he would look into allegations that bureaucrats in his ministry attempted to downgrade the forces. "I will see and if I find any reduction in functional responsibilities - this is not status...some people are trying to misguide - they will be on same platform as earlier," he said.
In 2003, 2005 and 2008, the Army, Air Force and Navy had independently written to the Defense Ministry expressing the same concern. The ministry responded to each letter saying the changes were only functional and there was no change in rank, honour and respect for the armed forces.
Arun Jaitley Favours Lower GST Rates For Essential Products, Higher Bracket For Luxury Goods
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NEW DELHI: Finance Minister Arun Jaitley today favoured levy of cess on tobacco and luxury products to compensate states for loss of revenue on GST saying the cost of funding that through an additional tax would be "exorbitantly high and almost unbearable".
Ahead of the meeting of all powerful GST Council next week to decide on GST rates, Mr Jaitley said the 4-slab structure of 6, 12, 18 and 26 per cent was under consideration, with lower rates for essential commodities and higher bracket for luxury goods.
"Different items used by different segments of society have to be taxed differently. Otherwise the GST would be regressive. Air conditioners and hawai chappals cannot be taxed at the same rate. Total tax eventually collected has to be revenue neutral. The Government should not lose money necessary for expenditure nor make a windfall gain," he wrote in a Facebook post.
Explaining the rationale for cess, Mr Jaitley said if the central government has to borrow money to fund states' compensation, it would add to its liability and increase cost of borrowing for the Centre, state governments and the private sector.
He said there is no rationale for increasing direct tax for this purpose and theoretically it has been argued that the compensation be funded out of an additional tax in the GST rather than by cess.
"Assuming that the compensation is Rs. 50,000 crore for the first year, the total tax impact of funding the compensation through a tax would be abnormally high. A Rs. 1.72 lakh crore of tax would have to be imposed for the Central Government to get Rs. 50,000 crore in order to fund the compensation," he said.
"50 per cent of the tax collected would go to the States as their GST share and of the balance 50 per cent in the hands of the Central Government and 42 per cent more would go to the States as devolution.
"So out of every 100 rupees collected in GST only 29 per cent remains with the centre. The tax impact of this levy would be exorbitantly high and almost unbearable," he said.
Alternatively, Mr Jaitley said cesses can be imposed which would be subsumed in the taxes after five years.
"This would include clean energy cess and cesses on luxury items and tobacco products, which in any case, presently also pay levy higher than 26 per cent. This would ensure no additional burden on the tax payer and yet be able to compensate the losing states," he said.
Ahead of the meeting of all powerful GST Council next week to decide on GST rates, Mr Jaitley said the 4-slab structure of 6, 12, 18 and 26 per cent was under consideration, with lower rates for essential commodities and higher bracket for luxury goods.
"Different items used by different segments of society have to be taxed differently. Otherwise the GST would be regressive. Air conditioners and hawai chappals cannot be taxed at the same rate. Total tax eventually collected has to be revenue neutral. The Government should not lose money necessary for expenditure nor make a windfall gain," he wrote in a Facebook post.
Explaining the rationale for cess, Mr Jaitley said if the central government has to borrow money to fund states' compensation, it would add to its liability and increase cost of borrowing for the Centre, state governments and the private sector.
He said there is no rationale for increasing direct tax for this purpose and theoretically it has been argued that the compensation be funded out of an additional tax in the GST rather than by cess.
"50 per cent of the tax collected would go to the States as their GST share and of the balance 50 per cent in the hands of the Central Government and 42 per cent more would go to the States as devolution.
"So out of every 100 rupees collected in GST only 29 per cent remains with the centre. The tax impact of this levy would be exorbitantly high and almost unbearable," he said.
Alternatively, Mr Jaitley said cesses can be imposed which would be subsumed in the taxes after five years.
"This would include clean energy cess and cesses on luxury items and tobacco products, which in any case, presently also pay levy higher than 26 per cent. This would ensure no additional burden on the tax payer and yet be able to compensate the losing states," he said.
Ties On Front Foot: When PM Modi Talked Cricket With New Zealand PM
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NEW DELHI: Cricket today became an analogy to highlight the warm ties between India and New Zealand as Prime Ministers Narendra Modi and John Key drew references from the game to stress on the progress made in their bilateral equation.
The references came on a day when India were taking on New Zealand in the fourth match of a five-game ODI series. PM Modi was the first to speak in the joint press briefing that followed the exchange of agreements between the two nations.
Referring to the ongoing ODI series, PM Modi said some cricketing terms were apt description of the progress made in the two countries' bilateral ties.
"In a little while from now, our cricket teams will take the field in Ranchi for the fourth one-day international. In many ways, some of the cricketing terminology reflects progress in our bilateral linkages. In our ties, we have moved from fielding at long off to taking a fresh guard at the batting pitch. Defensive play has given way to aggressive batting," PM Modi said.
Mr Key was not to be left behind and quipped that he is thankful to Modi for not raising his country's poor performance in the series so far. New Zealand were whitewashed 0-3 in the Test series and are trailing in the ongoing five-match ODI series as well.
"You have spoken about the cricket taking place in India but gracious enough not to be talking about the fact that India has been triumphing over New Zealand," Mr Key said in lighter vein.
"We are of course trying to build as warm and as close a relationship with India as we can and we have gone to the extraordinary lengths of ensuring that former Black Caps captain Brendon McCullum is now playing for Gujarat. So we are truly committed to the relationship between New Zealand and India," Mr Key said referring to Mr McCullum's IPL association with Gujarat Lions, the franchise based in PM Modi's home state Gujarat.
The references came on a day when India were taking on New Zealand in the fourth match of a five-game ODI series. PM Modi was the first to speak in the joint press briefing that followed the exchange of agreements between the two nations.
"In a little while from now, our cricket teams will take the field in Ranchi for the fourth one-day international. In many ways, some of the cricketing terminology reflects progress in our bilateral linkages. In our ties, we have moved from fielding at long off to taking a fresh guard at the batting pitch. Defensive play has given way to aggressive batting," PM Modi said.
Mr Key was not to be left behind and quipped that he is thankful to Modi for not raising his country's poor performance in the series so far. New Zealand were whitewashed 0-3 in the Test series and are trailing in the ongoing five-match ODI series as well.
"You have spoken about the cricket taking place in India but gracious enough not to be talking about the fact that India has been triumphing over New Zealand," Mr Key said in lighter vein.
"We are of course trying to build as warm and as close a relationship with India as we can and we have gone to the extraordinary lengths of ensuring that former Black Caps captain Brendon McCullum is now playing for Gujarat. So we are truly committed to the relationship between New Zealand and India," Mr Key said referring to Mr McCullum's IPL association with Gujarat Lions, the franchise based in PM Modi's home state Gujarat.
Centre Working To Reform Film Certification Process: Rajyavardhan Rathore
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NEW DELHI: The government is working to reform the film certification process so that the use of scissors is limited as much as possible, Minister of State for Information and Broadcasting Rajyavardhan Rathore today said.
Speaking at an event organised by the CII, Mr Rathore, however, added there will be restrictions as anything that "you can't speak off camera, you can't speak on the camera."
Later, speaking to reporters, Mr Rathore said the government is clear that freedom of expression must be encouraged and any restrictions should be in line with the constitution.
Speaking at the event, Mr Rathore said news innovations, disruptions in the media and entertainment sector are happening at a fast pace and there is a need to bring a change in rules.
He, however, added it can be done only after wider consultation so that there is a well thought out policy and no knee-jerk reaction.
Speaking about the online media, he said the rules which are there for broadcast and print media are not applicable to it, which is an aspect that needs to be looked into.
Referring to the broadcasting sector, he said there are a "mindboggling" 881 channels, including 349 in the news category, and more are coming up.
He also said as channels compete for ratings, it is important that news should be just news and is not created. Mr Rathore also said there are very few players in the DTH sector and the Information and Broadcasting ministry is soon going to bring in a new policy to help it spread.
Responding to a question on Prasar Bharati, Mr Rathore said while there is a need to improve its content and marketing, it is not fair to compare the public broadcaster with private channels.
He also said the government is planning a centre of Excellence in animation and visual effects in Mumbai.
To a question on controversy about filmmaker Karan Johar being asked to contribute to the Army Welfare fund, Mr Rathore only said that these contributions are voluntary.
Speaking at an event organised by the CII, Mr Rathore, however, added there will be restrictions as anything that "you can't speak off camera, you can't speak on the camera."
Speaking at the event, Mr Rathore said news innovations, disruptions in the media and entertainment sector are happening at a fast pace and there is a need to bring a change in rules.
He, however, added it can be done only after wider consultation so that there is a well thought out policy and no knee-jerk reaction.
Speaking about the online media, he said the rules which are there for broadcast and print media are not applicable to it, which is an aspect that needs to be looked into.
He also said as channels compete for ratings, it is important that news should be just news and is not created. Mr Rathore also said there are very few players in the DTH sector and the Information and Broadcasting ministry is soon going to bring in a new policy to help it spread.
Responding to a question on Prasar Bharati, Mr Rathore said while there is a need to improve its content and marketing, it is not fair to compare the public broadcaster with private channels.
He also said the government is planning a centre of Excellence in animation and visual effects in Mumbai.
To a question on controversy about filmmaker Karan Johar being asked to contribute to the Army Welfare fund, Mr Rathore only said that these contributions are voluntary.
Business Affairs
Sensex loses 100 points, Nifty falls below its 8,600 mark
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The S&P BSE Sensex on Thursday slipped 100 points, while the broader Nifty50 fell below its 8,600-mark.
The headline indices fell tracking lower trends seen in Asian Markets after disappointing earnings from technology giant Apple dragged on Wall Street, while the dollar remained shy of this week's nearly nine-month highs.
At 9:20 AM, The 30-share index was trading at 27,764, down 71.83 points, while the broad-based 50-share index fell 8,588, down 26.95 points.
"Going ahead, 8660-8700 would act as an immediate resistance zone. On the other hand, a follow- through selling may drag the Nifty towards the next support levels of 8580-8550," said Angel Broking in a report.
Tata Motors was the top loser on Sensex while Axis Bank was the top loser on the Nifty.
Among the Asian Markets, China's Shanghai Composite gained 0.34 per cent and the Hang Seng Index lost 1.18 per cent. While Japan's Nikkei gained 0.29 per cent.
Apple's results weighed on U.S. stock prices on Wednesday after the technology giant posted its first annual revenue decline since 2001, while oil and gold prices slipped.
The S&P BSE Sensex on Thursday slipped 100 points, while the broader Nifty50 fell below its 8,600-mark.
The headline indices fell tracking lower trends seen in Asian Markets after disappointing earnings from technology giant Apple dragged on Wall Street, while the dollar remained shy of this week's nearly nine-month highs.
At 9:20 AM, The 30-share index was trading at 27,764, down 71.83 points, while the broad-based 50-share index fell 8,588, down 26.95 points.
"Going ahead, 8660-8700 would act as an immediate resistance zone. On the other hand, a follow- through selling may drag the Nifty towards the next support levels of 8580-8550," said Angel Broking in a report.
Tata Motors was the top loser on Sensex while Axis Bank was the top loser on the Nifty.
Among the Asian Markets, China's Shanghai Composite gained 0.34 per cent and the Hang Seng Index lost 1.18 per cent. While Japan's Nikkei gained 0.29 per cent.
Apple's results weighed on U.S. stock prices on Wednesday after the technology giant posted its first annual revenue decline since 2001, while oil and gold prices slipped.
Cyrus Mistry's letter to Tata executives: All you need to know
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In a scathing letter to Tata Sons Directors, Cyrus Mistry has put forward his side of the story in the letter after he was removed as the Chairman of Tata Sons.
Sacked discourteously and abruptly, a "shocked" Cyrus Mistry levelled a series of allegations against Ratan Tata and contended that he was pushed in to a position of "lame duck" chairman and changes in decision making process created alternate power centres in Tata Group. Here's what Mistry wrote in his explosive letter:
- I was shocked beyond words at the happenings at the board meeting of October 24, 2016. Apart from the invalidity and illegality of the business that was conducted, I have to say that the Board of Directors has not covered itself with glory.
- "To 'replace' your Chairman without so much as a word of explanation and without affording him an opportunity of defending himself, in a summary manner must be unique in the annals of corporate history," he wrote in the email on October 25 which was circulated widely to the media today.
- Mistry said he was promised a free hand when he was appointed Chairman in December 2012 but Articles of Association were modified, changing the rules of engagement between the Tata family Trusts and the Board of Tata Sons. Stating that he inherited problems, he went on to raise corporate governance issues alleging representatives of family trusts, which hold two-thirds of Tata Sons shares, were reduced to "mere postmen" as they left board meetings midway to "obtain instructions from Mr. Tata."
- Mistry alleged that it was Tata who forced the Group to foray into the aviation sector by making him a 'fait accompli' to joining hands with Air Asia and Singapore Airlines and making capital infusion higher than initial commitment. Also, "ethical concerns" had been raised over certain transactions and a "recent forensic investigation revealed fraudulent transactions of Rs 22 crore involving non-existent parties in India and Singapore," he wrote.
- Mistry warned that the salt-to-software giant may face Rs 1.18 lakh crore in writedowns because of five unprofitable businesses he inherited. Defending his record, Mistry said he inherited a debt-laden enterprise saddled with losses and went on to single out Indian Hotels Co, passenger-vehicle operations of Tata Motors, European operations of Tata Steel and part of the group's power unit and its telecommunications subsidiary as "legacy hotspots."
- "I cannot believe that I was removed on grounds of non-performance," he said going on to point to two directors, who voted for his removal, only recently lauding and commending his performance.
- Detailing out the problems he inherited in several Tata group firms, Mistry in his letter said the foreign acquisition strategy with the exceptions of JLR and Tetley, had left a large debt overhang.
- Mistry also hit hard on the group's hospitality arm IHCL, saying beyond flawed international strategy, it had acquired the Searock property at a highly inflated price and housed in an off-balance sheet structure. "In the process of unraveling this legacy, IHCL has had to write down nearly its entire net worth over the past three years. This impairs its ability to pay dividends," he said.
- Tata Capital had a book that required clean up on account of bad loans to the infrastructure sector, he added.
- Highlighting the problems faced by the group's telecom business, Mistry said, "Of all the companies in the portfolio, the telecom business has been continuously hemorrhaging. If we were to exit this business, via fire sale or shut down, the cost would be $4-5 billion. This is in addition to any payout to Docomo of at least a billion plus dollars." He also lashed out at the original structure of the Docomo transaction, saying it "raises several questions about its appropriateness from a commercial or prudential perspective within the then prevailing Indian legal framework".
- On Tata Power, he said the company aggressively bid for the Mundra project based on low-priced Indonesian coal but as regulations changed, the losses in 2013-14 alone amounted to Rs 1,500 crore. "Given that Mundra constitutes Rs 18,000 crore of the capital employed (40 per cent of the overall company's capital employed) this substantially depresses the return on capital for Tata Power as well as carries the risk of considerable future impairments," he said in the letter.
- Turning to Ratan Tata's pet project Nano, Mistry said the product development concept called for a car below Rs 1 lakh but the cost were always above this and it had "consistently lost money, peaking at Rs 1,000 crore". "As there is no line of profitability for the Nano, any turnaround strategy for the company (Tata Motors) requires to shut it down. Emotional reasons alone have kept us away from this crucial decision," he said. Mistry further said: "Another challenge in shutting Nano is that it would stop the supply of the Nano gliders to an entity that makes electric cars and in which Mr Tata has a stake."
In a scathing letter to Tata Sons Directors, Cyrus Mistry has put forward his side of the story in the letter after he was removed as the Chairman of Tata Sons.
Sacked discourteously and abruptly, a "shocked" Cyrus Mistry levelled a series of allegations against Ratan Tata and contended that he was pushed in to a position of "lame duck" chairman and changes in decision making process created alternate power centres in Tata Group. Here's what Mistry wrote in his explosive letter:
- I was shocked beyond words at the happenings at the board meeting of October 24, 2016. Apart from the invalidity and illegality of the business that was conducted, I have to say that the Board of Directors has not covered itself with glory.
- "To 'replace' your Chairman without so much as a word of explanation and without affording him an opportunity of defending himself, in a summary manner must be unique in the annals of corporate history," he wrote in the email on October 25 which was circulated widely to the media today.
- Mistry said he was promised a free hand when he was appointed Chairman in December 2012 but Articles of Association were modified, changing the rules of engagement between the Tata family Trusts and the Board of Tata Sons. Stating that he inherited problems, he went on to raise corporate governance issues alleging representatives of family trusts, which hold two-thirds of Tata Sons shares, were reduced to "mere postmen" as they left board meetings midway to "obtain instructions from Mr. Tata."
- Mistry alleged that it was Tata who forced the Group to foray into the aviation sector by making him a 'fait accompli' to joining hands with Air Asia and Singapore Airlines and making capital infusion higher than initial commitment. Also, "ethical concerns" had been raised over certain transactions and a "recent forensic investigation revealed fraudulent transactions of Rs 22 crore involving non-existent parties in India and Singapore," he wrote.
- Mistry warned that the salt-to-software giant may face Rs 1.18 lakh crore in writedowns because of five unprofitable businesses he inherited. Defending his record, Mistry said he inherited a debt-laden enterprise saddled with losses and went on to single out Indian Hotels Co, passenger-vehicle operations of Tata Motors, European operations of Tata Steel and part of the group's power unit and its telecommunications subsidiary as "legacy hotspots."
- "I cannot believe that I was removed on grounds of non-performance," he said going on to point to two directors, who voted for his removal, only recently lauding and commending his performance.
- Detailing out the problems he inherited in several Tata group firms, Mistry in his letter said the foreign acquisition strategy with the exceptions of JLR and Tetley, had left a large debt overhang.
- Mistry also hit hard on the group's hospitality arm IHCL, saying beyond flawed international strategy, it had acquired the Searock property at a highly inflated price and housed in an off-balance sheet structure. "In the process of unraveling this legacy, IHCL has had to write down nearly its entire net worth over the past three years. This impairs its ability to pay dividends," he said.
- Tata Capital had a book that required clean up on account of bad loans to the infrastructure sector, he added.
- Highlighting the problems faced by the group's telecom business, Mistry said, "Of all the companies in the portfolio, the telecom business has been continuously hemorrhaging. If we were to exit this business, via fire sale or shut down, the cost would be $4-5 billion. This is in addition to any payout to Docomo of at least a billion plus dollars." He also lashed out at the original structure of the Docomo transaction, saying it "raises several questions about its appropriateness from a commercial or prudential perspective within the then prevailing Indian legal framework".
- On Tata Power, he said the company aggressively bid for the Mundra project based on low-priced Indonesian coal but as regulations changed, the losses in 2013-14 alone amounted to Rs 1,500 crore. "Given that Mundra constitutes Rs 18,000 crore of the capital employed (40 per cent of the overall company's capital employed) this substantially depresses the return on capital for Tata Power as well as carries the risk of considerable future impairments," he said in the letter.
- Turning to Ratan Tata's pet project Nano, Mistry said the product development concept called for a car below Rs 1 lakh but the cost were always above this and it had "consistently lost money, peaking at Rs 1,000 crore". "As there is no line of profitability for the Nano, any turnaround strategy for the company (Tata Motors) requires to shut it down. Emotional reasons alone have kept us away from this crucial decision," he said. Mistry further said: "Another challenge in shutting Nano is that it would stop the supply of the Nano gliders to an entity that makes electric cars and in which Mr Tata has a stake."
Sebi looking into Tata-Mistry saga; bourses seek clarification
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Market regulator Sebi has begun looking into the high profile Tata-Mistry case for any possible breach of corporate governance norms and listing regulations at various listed companies of the over $100 billion conglomerate.
Besides, stock exchanges, late this evening, sought clarification from many of the group's listed companies on the purported disclosure by ousted Chairman Cyrus Mistry of about Rs 1.18 lakh crore possible writedown at the group firms.
"We (Sebi) are taking note of each and every development and will act immediately on any hint of possible violation of corporate governance and listing norms or any other regulation under our jurisdiction," a senior official said.
The Securities and Exchange Board of India (Sebi) is looking into the alleged disclosure made in the purported letter written by Mistry to Tata Sons' board members including about financial and other irregularities as also lapses on the corporate governance front, sources said.
The stock exchanges and the regulators are also keeping a close watch on the price movement and trading activities of over two dozen listed companies of Tata group, which have seen an erosion in value in last two trading sessions after the surprise ouster of Mistry in less than four years of being made chairman of Tata Sons, the main holding company of the group.
The price movement and trading volumes for few days prior to the surprise announcement will also be looked into.
The exchanges have asked these companies, including Tata Motors, Tata Steel, Indian Hotels, Tata Teleservices and Tata Power, to provide full details about these issues.
The notices from the stock exchanges followed reports about Cyrus Mistry, who was ousted as the chairman of the group's main holding company Tata Sons, disclosing possible writedown to the tune of $18 billion faced by the conglomerate.
The exchanges have asked the companies to provide clarification/confirmation on the news item in detail. The companies have also been asked to explain whether such event/negotiations/article stated in published news were taking place? If so, you are advised to provide the said information along with the sequence of events in chronological order and the material impact of this article on the company, the exchanges said.
The companies have also been asked about any information that has not been announced to the exchanges as required under the Listing Regulations. The companies were yet to respond to the exchanges.
In an explosive confidential email to Tata Sons board members, Mistry warned that the salt-to-software giant may face Rs 1.18 lakh crore in writedowns because of five unprofitable businesses he inherited.
Mistry said he inherited a debt-laden enterprise saddled with losses and went on to single out Indian Hotels Co, passenger-vehicle operations of Tata Motors, European operations of Tata Steel and part of the group's power unit and its telecommunications subsidiary as legacy hotspots.
Market regulator Sebi has begun looking into the high profile Tata-Mistry case for any possible breach of corporate governance norms and listing regulations at various listed companies of the over $100 billion conglomerate.
Besides, stock exchanges, late this evening, sought clarification from many of the group's listed companies on the purported disclosure by ousted Chairman Cyrus Mistry of about Rs 1.18 lakh crore possible writedown at the group firms.
"We (Sebi) are taking note of each and every development and will act immediately on any hint of possible violation of corporate governance and listing norms or any other regulation under our jurisdiction," a senior official said.
The Securities and Exchange Board of India (Sebi) is looking into the alleged disclosure made in the purported letter written by Mistry to Tata Sons' board members including about financial and other irregularities as also lapses on the corporate governance front, sources said.
The stock exchanges and the regulators are also keeping a close watch on the price movement and trading activities of over two dozen listed companies of Tata group, which have seen an erosion in value in last two trading sessions after the surprise ouster of Mistry in less than four years of being made chairman of Tata Sons, the main holding company of the group.
The price movement and trading volumes for few days prior to the surprise announcement will also be looked into.
The exchanges have asked these companies, including Tata Motors, Tata Steel, Indian Hotels, Tata Teleservices and Tata Power, to provide full details about these issues.
The notices from the stock exchanges followed reports about Cyrus Mistry, who was ousted as the chairman of the group's main holding company Tata Sons, disclosing possible writedown to the tune of $18 billion faced by the conglomerate.
The exchanges have asked the companies to provide clarification/confirmation on the news item in detail. The companies have also been asked to explain whether such event/negotiations/article stated in published news were taking place? If so, you are advised to provide the said information along with the sequence of events in chronological order and the material impact of this article on the company, the exchanges said.
The companies have also been asked about any information that has not been announced to the exchanges as required under the Listing Regulations. The companies were yet to respond to the exchanges.
In an explosive confidential email to Tata Sons board members, Mistry warned that the salt-to-software giant may face Rs 1.18 lakh crore in writedowns because of five unprofitable businesses he inherited.
Mistry said he inherited a debt-laden enterprise saddled with losses and went on to single out Indian Hotels Co, passenger-vehicle operations of Tata Motors, European operations of Tata Steel and part of the group's power unit and its telecommunications subsidiary as legacy hotspots.
There's a new ATM that dispenses gold coins
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BlueStone.com, an online jewellery portal, has launched Gold ATMs in Bengaluru and Delhi.
This is the first time shoppers will be allowed to purchase gold off a vending machine.
The machines located at Forum Mall in Bengaluru and Select City Walk in Delhi are equipped to dispense certified 24 carat gold coins in denominations of one, two, five, ten and twenty grams.
First-time buyers and men especially are expected to make the most of the gold ATM owing to its functional and practical aspects.
Speaking on the launch, Arvind Singhal, COO, BlueStone.com said, "Introduction of the gold ATM during the festive season not only adds convenience to buying gold but is also a means to connect with our customers by providing them with physical touch points. Customers can purchase gold coins of multiple denominations by cash or card, making it ideal for buying gold for gifting or as an investment option."Offers and launches for DiwaliBlueStone.com has introduced over 250 new designs across categories and is also launching four new jewellery collections.
BlueStone.com, an online jewellery portal, has launched Gold ATMs in Bengaluru and Delhi.
This is the first time shoppers will be allowed to purchase gold off a vending machine.
The machines located at Forum Mall in Bengaluru and Select City Walk in Delhi are equipped to dispense certified 24 carat gold coins in denominations of one, two, five, ten and twenty grams.
First-time buyers and men especially are expected to make the most of the gold ATM owing to its functional and practical aspects.
Speaking on the launch, Arvind Singhal, COO, BlueStone.com said, "Introduction of the gold ATM during the festive season not only adds convenience to buying gold but is also a means to connect with our customers by providing them with physical touch points. Customers can purchase gold coins of multiple denominations by cash or card, making it ideal for buying gold for gifting or as an investment option."Offers and launches for DiwaliBlueStone.com has introduced over 250 new designs across categories and is also launching four new jewellery collections.
Speaking on the launch, Arvind Singhal, COO, BlueStone.com said, "Introduction of the gold ATM during the festive season not only adds convenience to buying gold but is also a means to connect with our customers by providing them with physical touch points. Customers can purchase gold coins of multiple denominations by cash or card, making it ideal for buying gold for gifting or as an investment option."Offers and launches for DiwaliBlueStone.com has introduced over 250 new designs across categories and is also launching four new jewellery collections.
Hero MotoCorp net profit rises 27.74% in Q2
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Hero MotoCorp on Wednesday announced a 27.74 per cent rise in Q2 net profit, posting its highest-ever quarterly sales of 18,23,498 units (growth of 15.8% over corresponding period last year. During July 2015 to September 2015, the firm sold 15,74,861 units.
The firm posted an all-time high net profit of Rs 1,004.22 crore in the second quarter of current fiscal against Rs 786.12 crore in the corresponding quarter of the last fiscal.
{blurb}
Earnings before interest, depreciation, tax, and amortisation (EBIDTA) margin improved to its highest-ever 16.20 per cent, as against 14.91 per cent over the corresponding quarter aided by softer commodities and cost control measures (LEAP).
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Pawan Munjal, Chairman, Managing Director and Chief Executive Officer, Hero MotoCorp, said, "The second quarter of this fiscal has been a defining phase in the journey of our young brand. The highest-ever volume sales during the quarter is a reiteration of the overwhelming customer preference of our products, and a testimony to our market leadership."
The earnings were announced after market hours. The Hero MotoCorp stock closed 1.92 per cent higher at Rs 3,421.55 levels on the BSE.
Hero MotoCorp on Wednesday announced a 27.74 per cent rise in Q2 net profit, posting its highest-ever quarterly sales of 18,23,498 units (growth of 15.8% over corresponding period last year. During July 2015 to September 2015, the firm sold 15,74,861 units.
The firm posted an all-time high net profit of Rs 1,004.22 crore in the second quarter of current fiscal against Rs 786.12 crore in the corresponding quarter of the last fiscal.
{blurb}
Earnings before interest, depreciation, tax, and amortisation (EBIDTA) margin improved to its highest-ever 16.20 per cent, as against 14.91 per cent over the corresponding quarter aided by softer commodities and cost control measures (LEAP).
{blurb}
Pawan Munjal, Chairman, Managing Director and Chief Executive Officer, Hero MotoCorp, said, "The second quarter of this fiscal has been a defining phase in the journey of our young brand. The highest-ever volume sales during the quarter is a reiteration of the overwhelming customer preference of our products, and a testimony to our market leadership."
The earnings were announced after market hours. The Hero MotoCorp stock closed 1.92 per cent higher at Rs 3,421.55 levels on the BSE.
General Awareness
RBI relaxes norms for foreign investment in startups
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The RBI relaxed foreign investment norms in financial services firms, startups and in investments by foreign regulated capital investors.Foreign Venture Capital Investors (FVCIs) can invest in Indian startups without prior permission of the RBI.
- Sebi-registered FVCIs have also been permitted to invest in unlisted firms in sectors like biotechnology, nanotechnology and dairy without prior permission of the RBI. They will not require any approval from Reserve Bank and “can invest in equity or equity linked instrument or debt instrument issued by an Indian ‘startup’ irrespective of the sector in which the startup is engaged,”
- These relaxed norms will help rationalise the investment regime for FVCIs and give a fillip to foreign investment in the startups
The RBI defines a ‘startup’ as any private limited company, partnership or a limited liability partnership, registered in India less than five years ago, with a turnover of less than Rs 25 crore during any of the preceding financial years. Such entities, the central bank stipulates, should be “working towards innovation, development, deployment or commercialization of new products, processes or services driven by technology or intellectual property.”
RBI decides to allow FDI up to 100% in other financial services
The Reserve Bank of India (RBI) has opened the gates for more overseas investment coming to India by a series of steps liberalising the foreign direct investment rules, even as it braces for a possible $26-billion outflows on account of FCNR-B deposit (foreign currency nonresident-bank) maturities.
- Such FDI shall be subject to conditionalities, including minimum capitalisation norms as specified by the concerned regulator or government agency.
- In the financial services activities that are not regulated or are partly regulated by any financial sector regulator or where there is a lack of clarity regarding regulatory oversight, FDI will be allowed up to 100 per cent under the government approval route.
- The present regulations on non-banking finance companies (NBFCs) stipulate that FDI would be allowed on automatic route for only 18 specified NBFC activities after fulfilling prescribed minimum capitalization norms mentioned therein.
- Other salient features of the revised regulatory framework include downstream investment by any entity engaged in ‘Other Financial Services’ and will be subject to extant sectoral regulations.
India central bank allows banks to approve extension of offshore company’s debt
The Reserve Bank of India has allowed banks to approve extension of external commercial borrowings on their own provided the debt is unpaid and has not defaulted before.
- Earlier banks had to seek approval of the central bank before restructuring any such offshore borrowings.
- Any extension of tenure, or conversion of unpaid ECBs into equity will be subject to consent of other lenders to the same borrower
RBI :
♦ RBI Governor: Urjit Patel
♦ Founded: April 1, 1935
♦ Headquarters : Mumbai
The RBI relaxed foreign investment norms in financial services firms, startups and in investments by foreign regulated capital investors.Foreign Venture Capital Investors (FVCIs) can invest in Indian startups without prior permission of the RBI.
- Sebi-registered FVCIs have also been permitted to invest in unlisted firms in sectors like biotechnology, nanotechnology and dairy without prior permission of the RBI. They will not require any approval from Reserve Bank and “can invest in equity or equity linked instrument or debt instrument issued by an Indian ‘startup’ irrespective of the sector in which the startup is engaged,”
- These relaxed norms will help rationalise the investment regime for FVCIs and give a fillip to foreign investment in the startups
The RBI defines a ‘startup’ as any private limited company, partnership or a limited liability partnership, registered in India less than five years ago, with a turnover of less than Rs 25 crore during any of the preceding financial years. Such entities, the central bank stipulates, should be “working towards innovation, development, deployment or commercialization of new products, processes or services driven by technology or intellectual property.”
RBI decides to allow FDI up to 100% in other financial services
The Reserve Bank of India (RBI) has opened the gates for more overseas investment coming to India by a series of steps liberalising the foreign direct investment rules, even as it braces for a possible $26-billion outflows on account of FCNR-B deposit (foreign currency nonresident-bank) maturities.
- Such FDI shall be subject to conditionalities, including minimum capitalisation norms as specified by the concerned regulator or government agency.
- In the financial services activities that are not regulated or are partly regulated by any financial sector regulator or where there is a lack of clarity regarding regulatory oversight, FDI will be allowed up to 100 per cent under the government approval route.
- The present regulations on non-banking finance companies (NBFCs) stipulate that FDI would be allowed on automatic route for only 18 specified NBFC activities after fulfilling prescribed minimum capitalization norms mentioned therein.
- Other salient features of the revised regulatory framework include downstream investment by any entity engaged in ‘Other Financial Services’ and will be subject to extant sectoral regulations.
India central bank allows banks to approve extension of offshore company’s debt
The Reserve Bank of India has allowed banks to approve extension of external commercial borrowings on their own provided the debt is unpaid and has not defaulted before.
- Earlier banks had to seek approval of the central bank before restructuring any such offshore borrowings.
- Any extension of tenure, or conversion of unpaid ECBs into equity will be subject to consent of other lenders to the same borrower
RBI :
♦ RBI Governor: Urjit Patel
♦ Founded: April 1, 1935
♦ Headquarters : Mumbai
♦ RBI Governor: Urjit Patel
♦ Founded: April 1, 1935
♦ Headquarters : Mumbai
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