www.business-standard.com

SUNDAY, 25 AUGUST 2019 12 pages in 1 section WORLD P8 WORLD P8 MUMBAI (CITY) ~10.00 AS EU THREATENS RETALIATION, BRAZIL TRUMP, EU CLASH OVER VOLUME XIII NUMBER 23 SENDS ARMYTO FIGHT AMAZON FIRES TRADE AT G7 OPENING

PUBLISHED SIMULTANEOUSLY FROM BENGALURU, KOLKATA, MUMBAI AND NEW DELHI Govttooffersix Arun Jaitley passes away oil&gasblocksin

ARCHIS MOHAN unexploredbasins New Delhi, 24 August Apersonal run Jaitley, former SHINE JACOB finance minister and a New Delhi, 24 August IN UNCHARTED key troubleshooter for tribute the Narendra Modi The government is set to offer six TERRITORY A government, died on ARUNJAITLEY, theformer blocks in the unexplored Saturday at the All India Institute of financeministerand Vindhyan and Bengal sedimenta- 311 Blocks awarded so far Medical Sciences (AIIMS) in the politicianofconsiderable ry basins for oil and gas explo- under Discovered Small national capital. He was 66. consequence,isnomore.Itis ration. Under a new policy, the Field Policy, New A press statement from AIIMS, animmeasurablelossforthe Centre will not charge royalties on Exploration Licensing Policy where he was put on life support after country, markingtheendofan production from companies oper- being admittedon August 9, era,theageofmoderationin ating in these areas. (NELP), and pre-NELP announced his demise at 12.07 pm. civiclife,whenitwasstill The Directorate General of Jaitley, the principal architect of possibletodoubtthe Hydrocarbons (DGH) will be invit- 178 Operational blocks under these policies the Modi government that took office ARVIND Nietzschedictumthatpower ing bids for seven oil and gas blocks in May 2014, had been in poor health SUBRAMANIAN isneverheldininnocence. during the fourth round of bidding for the past few years, which took a Jaitleywasamongstthe under the Open Acreage Licensing 89 Blocks awarded in the turn for the worse since January when moreenigmaticofrecentpoliticians.Itriedtoshed Policy (OALP), likely to open on first three rounds of Open he was diagnosed with soft-tissue somelightonhisstintasfinanceministerafew August 28, sources in the know Acreage Licensing Policy sarcoma, a rare cancer, and travelled monthsago;here,Iwanttosharesomethingeven said. The only block on offer in an Vedanta, RIL, BP, ONGC and to the USfor treatment. morepersonal.Politiciansdon’t“dointimacy”very already explored area in OALP-IV Oil India were major players Asfinanceminister, Jaitleyoversaw well.Asamatteroffact,theyshunitveryconsciously. will be in the Rajasthan basin. in the three rounds theroll-outofthegoodsandservices Andforgoodreason.Politicianswanttoexude Investors will get a window of 60 tax(GST)—probablythebiggesttax confidenceandinfallibility.Butintimacyleadsto days to submit their bids. 2023 Expected first reformsinceIndependence—andthe vulnerability,sinceconfidencescanbefataliftheyare The government sees this as a InsolvencyandBankruptcyCode(IBC). betrayed.So,oneoftheprivilegesofmy association milestone in the country’s hydro- production under OALP Also, itwasduringhistenureinNorth withhimwastogetjustaglimpseofthepersonality carbon sector, as investments so BlockthatPrimeMinisterNarendra behindthatguard,ofthemanmanningthepolitician. far were limited to only seven of 42 bn tonnes of Modiannouncedthecontroversial Still,Ican’tsaywithanyconfidencethatIcrackedthe the 26 sedimentary basins in oil-equivalent: Estimated decisiontodemonetise~500and enigmathatwasArunJaitley. the country. in-place resources in the ~1,000notesonNovember8,2016. WhenMrJaitleywasfirsttreatedinNewYorkfor According to the latest DGH 26 sedimentary basins Jaitley officially retiredfrom active hisillness,heexudedthequietconfidenceofaman estimates, the 26 basins have in- in the country political life on May 30, but falling “The level of popularsupportto this "Many warned us that it may notbe whobelievedthathewouldovercomethisdiseaseas place resources of 41.872 billion weight, low immunity, and fear of move (scrappingArticle 370 politically safe to introduce the GST. hehadseveralothersinhislife—diabetes,bariatric tonnes of oil-equivalent (BTOE), of infection had forced him to avoid provisions) has compelled several In several countries, governments surgery, renaltransplant. which 29.796 billion tonnes is public places in recent months. He, opposition parties to lostelections because of Butsadlythatconfidencewasmissingoncethe undiscovered hydrocarbons. however, continued to comment on supportthe move.They the GST. But India had mostrecentmedicalcomplicationsemerged.Heleft Bids will be floated after com- political developments in his tweets have sensed the ground JAITLEY'S one of the smoothest thegovernmentandretreatedtohishomeinKailash panies submit expressions of inter- and blogs. His last post was on reality and do notwantto transformation... Colony, honourably—anduncharacteristicallyfor est for these areas, incentivised by Parliament scrapping provisions of face the wrath of the LAST The Council worked modern-daypoliticians—givinguphislargeofficial a February 19 decision by the Article 370 of the Constitution. Jaitley people...The ‘New India’ on the principle of houseandmanyoftheperksthatcamewithit.And Cabinet that waived royalties for had undergone a kidney transplant at WORDS whenvisitorscame,hewantedtoreflectonthelarger unexplored blocks. It also stated AIIMS in May 2018. In September has changed. Only consensus, adding to issuesthatconcernedhim. that in basins where there was no 2014, he had bariatric surgery to the Congress does not the credibility of the InJune,hiseyesweregluedtotheWorldCup commercial production, explo- control diabetes-induced weight gain. realise this” decision making process” cricketmatchplayingontheTVscreen.Buthewas ration blocks would be bid out During the tenure of the firstModi (In his lastblog on August 6, 2019) (On the GST on July 1, 2019) nonethelessinanexpansivelyreflectivemood, exclusively on the basis of explo- government, Jaitley had handled the THE PEOPLE'S FINANCE MINISTER PAGE 9 talkingabouthishealth,thechallengingstateofthe ration work programme, without portfolios of defence, information and economy, andhiscorelifevalues.Threevalues,drawn any revenue or production share broadcasting, finance, and corporate fromdifferentreligions,appealedtohim,hesaid: to the government. The move is Contracts for 32 blocks under affairs. He was also the chief find difficult to fill. the Opposition in the House from Karma,thelinkingofactionandconsequence;comp- likely to draw more interest from the second and third rounds were troubleshooter of the government, a Jaitley was serving his fourth term 2009 to 2014, and the leader of the assionforothers;andthespiritofsocialservice. global oil and gas majors, which awarded on July 16. Those rounds vacuum that the government could as Rajya Sabha MP, was the leader of House from 2014 to 2019. Turn to Page 4 > Turn to Page 4 > had not shown much interest in saw participation from private the first three rounds of the OALP. players like Vedanta, BP and The Vindhyan basin covers Reliance Industries, and state-run areas under the Son valley, majors like ONGC, Oil India and Bundelkhand and Rajasthan, while Indian Oil Corporation. The first GOVT: NO ADDITIONAL the Bengal basin is in West Bengal OALP bid round was launched by Smartphone firmsstormsmartTV and extends into the offshore the government in January 2018, SURCHARGE ON FPIs region of the Bay of Bengal. The and received 110 bids for 55 blocks seven category-I explored basins covering 59,282 sq km area. The FOR DERIVATIVES, TOO in India are Cambay, Mumbai blocks were awarded in October market,thankstolowdatatariffs Offshore, Rajasthan, Krishna 2018 and production from the first The Centre on Saturday Godavari, Cauvery, Assam Shelf, round blocks is expected by 2023. clarified that enhanced and Assam-Arakan Fold Belt. Turn to Page 4 > surcharge had been 32% 39% YUVRAJ MALIK competitive prices. MINI withdrawn for foreign Others Xiaomi Bengaluru, 24 August This week, OnePlus, the maker of the BUDGET portfolio investors on hugely popular OnePlus 6 and OnePlus 6T capital gains in both the Leading smartphone brands such as handsets, too announced that it would come ISOLATION OF J&K ALLOWED equity and derivatives segments. The SMART TV Xiaomi, Micromax, Redmi (a sub-brand out with smart TVs in September. The Centre on Friday had announced a slew of Xiaomi) and OnePlus are set to disrupt the Chinese phone-maker is expected to woo measures to boost the economy, MARKET smart television space, which has so far consumers with smart TVs that are as aggres- YOUTH TO BE MISGUIDED: PM including roll-back of enhanced super- 14% been dominated by electronics giants sively priced as its feature-rich phones. rich tax on foreign and domestic equity Sony Sony, LG, Samsung and Panasonic. “Over the past six years, we have achieved Prime Minister Narendra Modi has said investors imposed in the Budget. The 15% Internet-enabled smart TVs, which are a great success in India in large part because of Jammu and Kashmir’s special status derivatives (futures and options) are not LG relatively new segment in India, are our passionate and supportive communi- was revoked to end its “isolation”, treated as capital asset and the income expected to see a major boost on the ty… The OnePlus TV is such an important which allowed some of the youth to be arising from the transfer of the back of lower data tariffs, which have product for all of us, and we can’t wait to see “misguided, get radicalised and take derivatives is treated as business income resulted in a massive uptick in online it in living rooms all over India,” OnePlus to violence and terrorism”. Modi said it and liable for normal rate of tax for video consumption. founder Pete Lau said in a blogpost on the was India's “internal step” which was domestic investors, an official statement While Xiaomi is already present in company’s website. taken in a “completely democratic, open, said on Saturday, clarifying the stand of this space, its sub-brand Redmi, whose OnePlus TV, the company’s first offer- transparent and constitutional” manner. tax authorities on gains made from smartphones are quite popular in India, ing outside of smartphone and mobile Modi, in an interview to Khaleej Times on derivatives trading. is expected to launch smart TVs soon. accessory categories, will initially be avail- Friday, said his government scrapped Given the value it offers for its price able in India, followed by launches in inter- Article 370 to end the isolation that had AUTO FIRMS UNSURE OF BENEFITS point in the smartphone space, Mi TVs national markets such as North America, kept J&K underdeveloped "to serve the IN FESTIVE SEASON P6 are also likely to be available at Europe and China. Turn to Page 4 > vested interests of a few”. 12 > COMPANIES P2 Newplans signal pain forsmall channels Debtof195companiesnowexceedsmarketcap Lifestyle, travel and niche television broadcasters face an uncertain future with the sector regulator looking to rein in These firms owe ~13 trillion This imbalance between debt and m-cap, channel bouquets. In its consultation CORPORATE STRESS analysts say, could trigger a fresh wave of corpo- paper released last week, the Telecom to lenders and account for Trend in the number of companies whose rate defaults as low m-cap makes it difficult, if Regulatory Authority of India (Trai) borrowings exceed their market capitalisation not impossible, for companies to raise equity addressed three key points including the 55% of all non-financial capital either to deleverage their balance sheet bundling of channels under bouquets, corporate debt or fund operations. rampant discounting within bouquets, In all, 54.5 per cent of all corporate loans in the and the lack of consumer choice. KRISHNA KANT listed space (ex-financials and government- Mumbai, 24 August owned companies) are now with companies with inadequate m-cap, up from 46.5 per cent at the COMPANIES P3 The recent correction in the stock market has end of March this year and 40.5 per cent at the CG Powerto sell Mumbai raised the insolvency risk in corporate India, with end of March 2018. borrowings exceeding market capitalisation "The amount of capital that a company raises land, CG House by FY21 (m-cap) for 195 non-financial and non-govern- is often a fraction of its existing market capitali- Fraud-hit CG Power and Industrial Solutions ment-owned companies, the highest in at least five *Based on market capitalisation as of August 23, 2019 sation. So the ability to raise capital falls sharply Note: A common sample of 742 non-financial & non-government companies from (CG Power) is planning to complete the sale years. In comparison, there were 147 such firms at BSE500, BSE Mid-Cap and BSE Small-Cap indices; excludes debt-free companies as a company's stock price plummets, reducing Source: Capitaline; compiled by BS Research Bureau of its Mumbai land parcel by March 2020 and the end of March 2019 and 99 at the end of FY18. financial elbow room for a company just when it CG House by the following financial year, the A bigger worry for lenders is that the majority requires liquidity to tide over operation and company has informed its rating agency. of corporate loans are now tied up with these Tata Motors (32.7 per cent), Tata Power (30.4 per The analysis is based on a common sample of financial difficulty," said G Chokkalingam, “As per the management, the company also financially stressed firms. Together, these 195 cent), Tata Steel (38.5 per cent), GMR 742 non-financial companies that are part of founder and MD, Equinomics Research & aims to complete the sale of its land parcel in companies owe ~13 trillion to various lenders, the Infrastructure (37.7 per cent), IRB Infrastructure either BSE 500, BSE MidCap or BSE SmallCap Advisory Services. Kanjurmarg by end-January 2020 while the highest in the last five years and up 47.5 per cent (17.5 per cent), Sadbhav Engineering (18.1 per index, and excludes government-owned compa- Low valuations could potentially choke the sale of CG House is likely to be completed by from a low of ~8.8 trillion at the end of March 2018 cent), Adani Power (48.1 per cent), Jindal Steel (30 nies and debt-free companies in segments such as finances of many companies in capital-inten- the first half of FY2021,” India Ratings said in and ~11 trillion at the end of March this year (see per cent), and Rattan India Power (2.7 per cent), listed multinationals, fast-moving consumer sive sectors, such as telecom, power, metals and its note while downgrading the company’s the adjoining chart). among others. This is based on companies' m-cap goods (FMCG), and information technology serv- mining, and infrastructure, starting a vicious ratings from BBB+ to B on Friday on Some prominent companies with very low m- at the end of August 23, 2019, and total debt at the ices companies, such as Tata Consultancy cycle of low liquidity, poor profitability and corporate governance issues. cap to debt ratio are Vodafone Idea (15.1 per cent), end of FY19. Services, Infosys, HCL Technologies, and Wipro. even lower m-cap. Turn to Page 4 > 2 COMPANIES MUMBAI | 25 AUGUST 2019 >

IN BRIEF Naspers looks to invest in AI New plans signal pain for small channels as Prosus listing gets approval VIVEAT SUSAN PINTO worldwide practice and India is no vent their business models to survive. Naspers is looking to invest in machine learning as Africa’s largest Mumbai, 24 August BAD PICTURE exception.” “Smaller broadcasters may have company seeks to expand following an Amsterdam listing of assets | Small channels may have to fold But consumer activists argue that to simply become content providers, including a stake in Tencent Holdings. The South Africa internet and ifestyle, travel and niche tele- up if TRAI goes ahead with its bundling of channels has not only who are agnostic to a platform,” says technology group spent about $3 billion on its various ventures vision broadcasters face an resulted in inflated bills, but also left the chief executive officer of a travel plan to restrict channel bouquets around the world last year, including Indian food-delivery service L uncertain future with the sec- viewers with fewer channels of their and lifestyle channel. “At a time Swiggy and Russian classifieds site Avito BB. Machine learning — a tor regulator looking to rein in chan- | Consultation paper released last choice. “Why should consumers nav- when niche channels in general have subset of artificial intelligence — is another area of interest, as is nel bouquets. week by TRAI has come down igate through a bouquet that has faced significant threat from over- online education, executives said on Friday. In its consultation paper released hard on bundling of channels channels they do not wish to see?” the-top platforms, this is one way in “We are interested in investing in machine learning,” Chief last week, the Telecom Regulatory said Bejon Misra, consumer affairs which we could survive in the Executive Officer Bob van Dijk told shareholders at the annual Authority of India (TRAI) addressed | Regulator says cap on expert and founder, Consumer future,” he says. general meeting in Cape Town. “The amount of data is exploding — three key points including the discounting should be Online Foundation. On Friday, the Indian last year we collected more data in the world than ever before.” bundling of channels under bou- re-introduced “The last few months, since the Broadcasting Federation, an apex Naspers has taken stakes in myriad businesses around the world to quets, rampant discounting within | It also says ceiling of Trai tariff order was introduced, have body of broadcasters, said Trai’s con- try and replicate its success with Chinese internet giant Tencent, bouquets, and the lack of consumer ~19 per channel should be been chaotic for consumers,” said sultation paper was premature and < which it backed as a start-up 18 years ago. PTI choice. scrutinised Misra. “In many places, for instance, any intervention by the regulator at Specifically, it proposed two cable operators are only offering bou- this stage could impact the industry Luxury housing RE/MAX aims to sell measures to tackle the issue. One was quets that are pre-fixed in terms of negatively. supply back on property worth to re-introduce a cap on discounts price. There is no concept of pick- “The new tariff order allows within bouquets and the second was bouquets, the regulator said, was also “Typically, consumers prefer the and-choose as indicated by the new broadcasters and distribution plat- track, says Anarock ~1,000 cr this year scrutiny of the ceiling price, current- confusing to consumers, which was popular channels,” said Girish tariff order. This in my view defeats form operators to offer channels both ly fixed at ~19 per channel. against the spirit of transparency and Menon, partner and head, media and the purpose of the tariff order and a ala carte and in bouquets. The basic The supply of luxury housing Global real estate broker While broadcasters said TRAI had free choice. entertainment, KPMG India. review of the system is needed.” tier, in fact, mandated by the tariff priced over ~1.5 crore that network RE/MAX said India is adhered to the cap on the channel Experts, however, argue that dis- “Bouquets allow large as well as But some broadcasters said small- order, which is of 100 free-to-air dipped sharply after the fastest growing and an price when it came to popular names couraging the concept of channel independent broadcasters to bundle er players may have to fold up if TRAI channels for ~130, is a bouquet offer- demonetisation has improved extremely important market for in general entertainment, sports and bouquets could be detrimental to those channels that are not in the goes ahead with its consultation ing. Thus, the impression that broad- and more-than-doubled to the company, as it set a target movies, smaller channels were arbi- small broadcasters who depend on consideration set of consumers along paper in its current form. Some others casters are gaming the system to 16,100 units in the first half of of ~1,000 crore sales bookings trarily priced. The sheer number of these platforms for reach. with popular channels. This is a say that smaller players may to rein- push bouquets is incorrect,” it said. this year across seven cities, this financial year. In a property consultant Anarock statement, RE/MAX India said it has said. The demand of these currently has over 1,000 agents luxury flats is now driven by having presence in 46 cities end users - high net worth through around 175 offices. individuals and non resident Globally, RE/MAX has over RailTel to float new tender Disney to make Star Warsits Indians, it added. The seven 123,000 agents associated with cities are - Delhi-NCR, Mumbai, it in 100 countries. “Globally at Chennai, Kolkata, Bengaluru, RE/MAX, India is an extremely for content-on-demand cash cow, plans new shows Hyderabad and Pune. As many important market for us to help as 16,100 new units have been revolutionise the real estate SHINE JACOB CHRISTOPHER PALMERI launched in the luxury industry here, to create New Delhi, 24 August ON TRACK Los Angeles, 24 August segment priced more than ~ 1.5 entrepreneurship and | ~6,000 cr: Initial expected crore across the top seven cities opportunities to individuals all The Indian Railways is plan- revenue over 10 years Walt Disney is opening a hotel – massively up from 5,240 units around India to start their own ning to float a new tender for that it insists isn’t a hotel — in H1 2017. PTI< business, either as an office content-on-demand during | ~1,000 cr: Revenue part of its latest push to wring owner or a broker,” said the first week of September. expected to be generated more money with the Star FIEO sees strong Shawna Gilbert, vice-president RailTel, the Railways’ sub- from new tender Wars franchise. (global development), RE/MAX. sidiary, had in 2017 floated a | 3,000: Number of railway The entertainment giant flow of exports RE/MAX India has been the similar tender — targeting unveiled plans for the Star stations with Wi-Fi from eastern India fastest growing region in the revenue of ~6,000 crore for a Wars: Galactic Starcruiser, a world, she added. PTI< 10-year period — but had internet facility multiday experience at Walt The Federation of Indian Export received lukewarm response. Disney World that will let Organisations (FIEO) said on After Walmart, This time, the Railways new tender again. initially requested the guests feel like they’re staying Saturday that it is expecting a has scaled down its revenue Major content owners like Department of inside a spaceship. strong flow of exports from Amazon says Tesla target to ~1,000 crore, people Eros, Balaji, and Shemaroo Telecommunications (DoT) It’s not a hotel or a ride, but eastern India, especially in the panels caught fire in the know said. Entertainment, and content to reserve 15 MHz of spec- a “space cruise”, the company iron and steel sector. The content-on-demand aggregators were expected to trum in 700 MHz band on said this week at its biennial Gems and jewellery, iron Walmart isn’t the only one to plans will allow monetisation be keen on the initiative. “We February 27 and to allocate 10 D23 Expo, a fan convention. Disney is betting heavily on Star Wars, even as the brand has and steel, petroleum and have seen its Tesla solar panels of Railways’ entertainment hope that players like Zee MHz free of cost. DoT Disney showed off a model of shown signs of strain of late. PHOTO: REUTERS marine products occupied catch fire. On Friday, Amazon services. Based on the plans, Group will be part of the ten- referred the proposal to Trai. the ship, called the Halcyon, some of the top segments with said a June 2018 blaze on the entertainment services will der this time too,” a Railways At present, the railway designed for the Orlando, brand shows signs of strain. following the debut of a simi- regards to exports from West roof of one of its warehouses in be provided through audio official said. ministry has 2.5-3 MHz of the Florida, resort. The last feature film Solo: lar attraction at Disneyland in Bengal, said a statement from California involved a solar (public address systems) on Before the 2017 tender, 900 MHz frequency spec- The firm also announced A Star Wars Story, fizzled, Anaheim, California. the exporters' body. “We are panel system that Tesla’s trains and video systems (per- The Boston Consulting trum, but is only available at plans for a new Star Wars renewing concerns that The $1-billion land is continuing to endeavour to SolarCity division had installed. sonal devices of the passen- Group had done a study and certain spots, making Wi-Fi show based on the Obi-Wan younger viewers haven’t among the largest invest- seek fresh contacts with newer The Seattle-based retail gers) on trains and platforms. had indicated that content- connectivity patchy. Kenobi character. Ewan warmed to the franchise. ments Disney has made in its and upcoming markets with giant said by email that it has After the 2017 tender got on-demand plans had the The Railways is of the McGregor will reprise his role The “not-a-hotel” concept resorts. At the D23 confer- import demand so that it can since taken steps to protect its lukewarm response from potential to unlock as much view that this spectrum, from the movies, appearing in promises to be one of the most ence, Disney also announced boost export prospects of our facilities and has no plans to industry players, the Railway as ~2,277 crore in revenue in worth ~65,000 crore, will a program for the new immersive experiences yet for more plans to revamp Disney members and others to add to install more Tesla systems. Board had revised its non- three years. facilitate content-on- Disney+ streaming service. the firm, with costumed char- World’s Epcot. It will include the country's foreign News of the Amazon fire comes fare policy. It had also asked The national transporter demand. Further, Disney released a acters assuming the role of a new attraction based on its exchange,” FIEO Eastern Region just three days after Walmart the zones to come up with had approached the Telecom This comes at a time when trailer for its already- housekeeping staff and room animated hit Moana. Chairman Sushil Patwari said. dropped a bombshell lawsuit the job of tendering their Regulatory Authority of India the Indian Railways has announced Star Wars show windows projecting scenes of Disney has been adding He further said that in the against Tesla, accusing it of areas separately. However, as (Trai) for it to allot premium already extended its free pub- The Mandalorian, which also outer space. more attractions tied to the Indian economy, exports shoddy panel installations that this plan, too, did not take off, spectrum to the Railways for lic Wi-Fi services in 3,000 sta- is airing on Disney+. It will be connected to a company’s hit films to the contribute substantially to the led to fires at more than a half- the board has asked RailTel its captive use. tions — the last one being at Disney is betting heavily Star Wars land that’s opening park, the company’s second- country’s GDP. PTI< dozen stores. BLOOMBERG< to be the nodal agency for the The railway ministry had Ellenabad station in Bikaner. on Star Wars, even as the at Disney World on August 29, oldest in Florida. BLOOMBERG Leisure Hotels to diversify into hostels, resitels Nithia Capital

SHALLY SETH MOHILE top executive of the company. buys, but the buyer will get a Mumbai, 24 August ROOM FOR MORE The alternative accommo- yield of 4 per cent when the lists steel assets dation segment covers home- property is rented back, Leisure Hotels Group, the | Operates: 27 boutique properties, stays, hostels, apartments, said Prasad. Dehradun-based hospitality 875 rooms villas, cabins, tree-houses, Leisure will be developing for acquisition firm, is diversifying into the | Pipeline: Properties by 2021 boats, and bed and breakfast resitels at Bhimtal, Nainital, hostel and resitel segments as facilities, among others. Rishikesh, and Naukuchiatal. ISHITA AYAN DUTT CarVal-led consortium as it seeks to unlock the poten- | To diversify into hostel under The properties — villas or It will start construction at a Kolkata, 24 August the preferred bidder but SSG tial in the alternative and Bedz brand and Resitel by apartments being developed couple of these locations in Capital, the other bidder in long-stay accommodation year-end by Leisure under the resitel the next two months. Nithia Capital, a UK-based the fray, had challenged the sectors, even as it executes an | First hostel coming up in concept — will be open for Meanwhile, the group that alternative investment man- lenders’ decision in NCLT. expansion plan in its core sale and transfer of owner- currently operates 27 bou- ager that specialises in turn- The hearing is over and the hotel segment, said a top Hrishikesh, to compete with ship. The purchaser will get tique properties with around ing around underperform- matter has been reserved for company executive. peers such as Zostel 30 days that could be con- 875 rooms in India plans to ing facilities, has identified order, said Saraf. Leisure’s hostel — a low- sumed by him/her or his/her invest ~160 crore to add nine 15 stressed steel assets in If the Uttam bid finally frill, budget accommodation Leisure Hotels told Business Leisure plans to charge tel will come up in Jaipur, but family or friends, in addition properties across the country India for acquisition. goes in favour of the CarVal comprising beds and budget Standard. ~800-900 for beds per night it will follow a franchisee to the rent, he or she would by end-2021. Although it has zeroed in consortium, it would then be rooms under the Bedz brand “India has broken the and ~2,000-3,000 for the model similar to Zostel’s. enjoy for 15 years as per the These will include proper- on 15 assets, only some are Nithia Capital’s first expo- — will come up in Rishikesh ground with hostels. But of rooms and create the concept According to travel portal lease agreement. ties in Goa and Greater Noida, expected to materialise. sure in India. by the end of this year. late, most of the action has of community living. It will Booking.com, India is among The buyers of these prop- as the company aims to Though they are all stressed Nithia Capital had also Aimed at backpackers and shifted to co-working and co- be based on the dynamic pric- the fastest-growing markets erties would be high net- spread beyond Uttarakhand. assets, not all have been looked at major assets such long-stay travellers who visit living spaces, and hostels not ing model and driven by in terms of addition of alter- worth Indians living the While some of the aforemen- referred to the National as Essar Steel, Bhushan Steel the Himalayan foothill region getting that attention,” said demand on a particular day. native accommodation plat- country or abroad and who tioned properties are owned Company Law Tribunal and Monnet Ispat & Energy, seeking adventure, wellness Prasad. The existing hostels in “With an attractive food forms. Of the total 880,000 are keen to own a by Leisure, a few are jointly (NCLT) for debt resolution. before they were put up for or pilgrimage, Bedz will com- Rishikesh normally charge and beverage outlet, it can listings in India, over 140,000 vacation/second home. It’s owned and managed by the The total enterprise val- debt resolution at the NCLT. pete with Zostel — one of the between ~250 and ~300 per become a lively place for all are in the ‘alternative accom- not an investor-driven model firm and the others are just uation that Nithia is looking However, as major steel largest hostel chains in India, bed a night, but Leisure is those who visit Rishikesh,” modation’ segment, PTI had and there are no assured managed by it across key at is $1.0-1.2 billion, as part players started evincing said Vibhas Prasad, director, looking to up the ante, he said. said Prasad. The second hos- reported in May 2019, citing a returns on the property one leisure destinations. of its India plan. interest, Nithia changed tack The assets are small, and started focusing on located in central and east- smaller assets. ern India. “The idea is to cre- “The big assets were then ate a platform of 3.0-3.5 mil- going through the CDR and lion tonnes of steel capacity, SDR mechanism. But nei- Boeing 737 Max could take off once again in October and then we will grow organ- ther banks nor promoters ically and complete the half- were keen on taking a hair- JULIE JOHNSSON, ALAN LEVIN worked their way through test pilots is one of the final steps finished capex. In 4-5 years, cut, or were willing to cede & RICHARD WEISS hundreds of queries fielded by the that must be conducted before we plan to exit through an control. Therefore, it was a Chicago/Washington/Frankfurt, FAA from colleagues around the Boeing’s submission is finalised, IPO or strategic sale,” said Jai frustrating 12-14 months,” 24 August world, with few new concerns and based on the timing, the final Saraf, founder and chief said Saraf. being raised at this point in the paperwork may not be completed executive officer. In India, It prompted Nithia to The Federal Aviation process, the people said. until the fourth quarter. Nithia has an arrangement reconfigure its strategy. “We Administration is likely to conduct The Chicago-based company is If the plane behaves as with CarVal Investors, started looking at assets its certification flight for Boeing also briefing customers on its plans expected, the results become part founded by Cargill. below a million tonnes Co’s 737 Max in October, a key for unwinding an unprecedented of the package for certification. “CarVal is our preferred capacity, which was not on milestone toward returning the global grounding that has already Even though FAA engineers have financial partner. For all our the radar of big players,” grounded jetliner to the skies, said surpassed five months, with about worked closely with Boeing for steel assets, we have to offer explained Saraf. people briefed on the matter. 600 planes temporarily months, the agency must perform it to CarVal first for partici- The IBC, according to That timing would be broadly mothballed. a series of checks after the pation. If they don’t join, Saraf, is a once-in-a-lifetime consistent with Boeing’s estimate “We continue to support the submission is made before only then can we partner opportunity to buy assets at that the Max will return to service FAA and global regulators on the granting approval. with other financial a fair value and for less than early in the fourth quarter, but may safe return of the Max to service,” “The FAA’s certification of the look forward to their findings.” Another step in the process is a investors,” Saraf said. the replacement cost. “It is push the submission of a final Boeing said in a statement. Boeing 737 Max is the subject of There are still numerous tasks review by the FAA’s Flight The CarVal consortium, far from perfect, but is evolv- certification package slightly The FAA is focused on ensuring several independent reviews and to be accomplished before Boeing Standardization Board, which of which Nithia is a part, had ing very fast,” he said. beyond September, as the that the revamped 737 Max systems investigations that will examine can complete its submission to must recommend training bid for Uttam Galva The steel industry has company previously estimated. meet safety requirements, and all aspects of the five-year effort,” recertify the plane, said another requirements for the plane. In Metallics which was on the been under pressure globally The US planemaker is testing doesn’t have a timeline for the agency said. “While the person familiar with the process. April, it made a preliminary RBI’s second list of non-per- on account of demand wor- changes to the flight-control returning the plane to service, agency’s certification processes The person wasn’t aware of a conclusion that pilots wouldn’t forming assets (NPAs) for ries, but Saraf said that it software architecture of its best- according to a statement by the are well established and have specific projection that the FAA need simulator training before debt resolution under the would not be a deterrent for selling jetliner, which suffered two agency. FAA employees have consistently produced safe test flight would occur in October, flights resume. But the body hasn’t Insolvency and Bankruptcy Nithia to invest in the sector. fatal crashes in a five-month span. already spent 110,000 hours aircraft designs, we welcome the but said it was a possibility. issued its final conclusions. Code (IBC). “Steel is a cyclical industry,” Boeing engineers have almost working on the project, it said. scrutiny from these experts and A certification flight with FAA BLOOMBERG Lenders had selected the he pointed out. MUMBAI | 25 AUGUST 2019 COMPANIES 3 > CG Power to sell properties by FY21 WeWork to ramp up Plans to complete sale of its Mumbai land parcel by March 2020 & CG House by the following FY offering of low-cost AMRITHA PILLAY committed by the officers or employees Mumbai, 24 August TIMELINE of the company”. nEntered into an agreement to Between October last year and raud-hit CG Power and sell Mumbai land in June 2019 August this year, CG Power’s rating co-working spaces Industrial Solutions (CG Power) has been downgraded multiple times. Fis planning to complete the sale nInforms exchanges of an In October, the company was rated Targets expansion in Mumbai; eyes NCR, Hyderabad entry of its Mumbai land parcel by March employees led fraud on AA negative, which fell to BBB+ on 2020 and CG House by the following 20 August August 5. financial year, the company has The RAC report, which was made RAGHAVENDRA KAMATH informed its rating agency. nIndia Ratings downgrades public on Tuesday, had flagged high- Mumbai, 24 August “As per the management, the com- company from BBB plus to B on value loans extended to group compa- pany also aims to complete the sale of 23 August nies. An India Ratings note on April 3 US-based co-working space provider WeWork its land parcel in Kanjurmarg by end- shows lower recoveries from group is readying the launch of more economical cen- January 2020 while the sale of CG nManagement informs that companies. “As of December 2018, CG tres to boost sales, said a person in the know. House is likely to be completed by the Mumbai land sale will be Power received ~80 crore of ~760 crore In its upcoming property on the Jogeshwari- first half of FY2021,” India Ratings said completed by January 2020 extended to associated group compa- Vikhroli link road in Mumbai, a desk will cost in its note while downgrading the com- n nies, as against an expectation of ~200 between ~5,000 and ~13,000 a month. The pany’s ratings from BBB+ to B on Friday Plans to complete sale of crore,” the note said. 266,000-sq-ft premises will open next month, on corporate governance issues. CG House by first half of FY2021 There has been an attempt to and will be among the largest of WeWork's cen- The proceeds from the sale (land reduce these receivables from the tres with around 4,400 desks. and CG House) are likely to be used for Avantha Group through reduction in Wework is also, according to people with repaying part of its debt and meeting led fraud. Following this, the India financial irregularities reported by the royalties payable. In the December 2018 knowledge of the matter, looking to launch its working capital requirements. Ratings’ downgrade came. company in 4QFY19 results announce- quarter, CG Power decided to reduce such economical desks in Delhi and other cities. In June this year, CG Power “The Negative Outlook reflects the ment and weakened financial profile,” royalties payable to Avantha by half To put this in context, it charges users informed the exchanges it had entered heightened debt repayment risk in the the rating note added. and in turn reduce loan between ~18,900 and ~42,000 a month at its into an agreement with Evie Real near term, given the company’s weak One of CG Power’s joint The proceeds from receivables from the Enam Sambhav property at Bandra Kurla Estate for a land parcel in Kanjurmarg, liquidity position,” the rating note auditors, SRBC & CO LLP, has the sale (land and group. “Against a reduc- Complex. At Annie Besant Road in Worli, it Mumbai, for ~498.96 crore. released on Friday said. sought information and an CG House) are likely tion in royalties, the charges over ~15,000 a month. The land parcel currently houses According to India Ratings, CG explanation from the company to be used for company would be The company felt, said the people cited the transformer-manufacturing unit of Power’s liquidity position deteriorated regarding certain other trans- repaying part of its reducing group receiv- above, that users considered the current rental EXPANDING FOOTPRINT CG Power and measures 13 acres. significantly with a cash balance of actions as part of the notice debt and meeting ables by ~410 crore. As fees higher than those of others. nNew centre on JVLR in Mumbai will cost CG Power on Tuesday informed the ~240 crore at end of FY19, estimated issued to it. These notices, its working capital per the management, WeWork is also entering new cities such ~5000-~13,000 a month exchanges of a risk and audit commit- against debt-servicing requirements of India Ratings in a note said, requirements the balance ~270 crore as Hyderabad and Pune, and plans to widen nWework also looking at Delhi NCR and tee (RAC) report that detailed dubious more than ~600 crore in FY20. “pertains to cases where the would be recovered its presence in other cities, of which one is other cities for economical centres transactions at the company. The “The downgrade reflects weak cor- auditor believes an offence over a period of time,” Mumbai, said the people. A WeWork report indicated it was an employee- porate governance reflected by the involving fraud is being or has been the India Ratings in its April 3 note said. spokesperson, however, declined nWeWork is entering new cities such as to comment. Hyderabad and Pune The company reportedly took 122,165 sq ft nIt has taken up 122,165 sq ft office space in of office space in Panchshil Realty's commercial project, named Panchshil Futura, in Pune. The Panchshil Futura in Pune Biocon bets on US, EU to break even at Malaysia unit rent charged stands at around ~75 a sq ft. This nIn Hyderabad, it has acquired 225,000 sq new centre in Pune, expected to be launched ft in Rajapushpa Summit early next month, will have capacity of at least nWeWork has 23 co-working centres in the SAMREEN AHMAD INJECTING FUNDS for regulatory norms to be fulfilled, it 2,000 seats, they added. Bengaluru, 24 August requires additional expenses which In Hyderabad, it has taken 225,000 sq ft at country n The firm is looking to derive could lead to loses. “The process has the Rajapushpa Summit, where rent charged India’s largest pharmaceutical firm sales from developed markets to be stabilised and it will take time, is around ~60 per sq ft. According to Colliers International, leas- Biocon is looking at deriving its sales to achieve break-even at its energy and money. If things are not in At present, WeWork has 23 co-working cen- ing spaces in flexible workspaces have from developed markets such as the Malaysian subsidiary order, then the company has to bare tres across the country, with a total of 39,000 increased with the large expansion by such US and the European Union to achieve additional expenses,” said the analyst. seats spread over 3 million sq ft. It has nine in operators. In the first half of 2019, flexible break-even at its Malaysian subsidiary. n The unit is Asia’s largest The USFDA had last month Bengaluru and five in Gurugram (Gurgaon). workspace operators have leased about 4.5 The Malaysia entity, which man- integrated insulins facility issued 12 observations after the WeWork operates in the coun- mn sq ft, a 25 per cent increase ufactures a range of insulins and n inspection of three of Biocon’s units try in a licensing agreement with WeWork is also from the same period a recently received the certificate of It suffered losses of ~28 crore in Malaysia. “We have submitted our the Embassy group. An initial entering new cities year before. GMP compliance from the European in FY19 response to the regulatory agency public offering, or IPO, is planned such as Hyderabad Anuj Puri, chairman of Medicines Agency, suffered losses of n The firm would be spending and have started addressing the by the company in America, and Pune, and plans Anarock Property Consultants, ~28 crore in 2018-19. observations. We are working closely expected to raise $3-4 billion, to widen its presence says traditional office spaces are According to an Edelweiss report, $200 million in the second with the regulator and remain con- according to reports. in other cities, of also seeing good traction, investments would pick up at the com- phase of the Malaysia plant fident of being able to address these The management fee it gets which one is Mumbai despite the entry of co-working pany subsidiary in the current finan- soon,” said the company. in the country is 12 per cent of spaces. “It has been estimated cial year and it would be spending of Insulin Glargine in the US in 2020 Biocon Chief Executive Officer Biocon’s Malaysia unit is Asia’s the revenue — the highest in that by 2020, the demand for co- $200 million in the second phase of to boost sales from this facility,” said a and Joint Managing Director Arun largest integrated insulins facility Asia — according to its regulatory filings working spaces in India will surpass that of the Malaysia plant. Biocon spokesperson. Insulin Glargine Chandavarkar had earlier told that manufactures drug products in with the US Securities and Exchange traditional office spaces. Nevertheless, while “The Malaysia plant will derive a was launched in key European mar- Business Standard that the vials, cartridges, and insulin delivery Commission. It earned $3.5 million in man- co-working has had its own growth story for large portion of its sales from devel- kets by the Bengaluru-headquartered Malaysian facility was expected to devices and markets them agement fees in the six months ended June the last two years, traditional commercial oped markets, which will drive its company’s partner Mylan in break even in FY19. in Malaysia, the EU and 30, a 118 per cent jump from $1.6 million in real estate leasing market in India has also profitability. We also expect the launch November last year. A pharma analyst, however, said emerging markets. the year-ago period. been on an upswing,” he said. USFDA issues Helicopter observations Gujarat to see 300 pharma Google tries to Corral service in to Ipca Labs unit applications: FDCA its staff after ugly Uttarakhand PRESS TRUST OF INDIA VINAY UMARJI suspended New Delhi, 24 August Ahmedabad, 24 August ARINDAM MAJUMDER internal debates New Delhi, 24 August Drug firm Ipca Laboratories Gujarat, one of the major on Saturday said the US pharma manufacturing hubs Google is setting new rules to restrain freewheeling The Directorate General of Food and Drug in the country, is set for more Civil Aviation (DGCA) has Administration (USFDA) action as roughly 300 new discussions among its employees during work hours. temporarily suspended heli- has conducted an inspec- applications are up for copter service in tion of its formulations approval with the state Food JACK NICAS Uttarakhand. manufacturing unit in and Drugs Control 24 August The direction comes after Silvassa and issued three Administration (FDCA). two incidents of helicopter observations. Amidst an already estab- years. “It takes around two Tax (GST), introduced in July Google has long prided itself crash in two consecutive In a regulatory filing to lished ecosystem of API units years for the execution of a 2017, which only attracted on a workplace culture in days. Both the helicopters BSE, Ipca Laboratories said in southern parts of the state, facility. With such a large more investment in the which employees are were parts of relief operations the USFDA had conducted most of the new applications number of companies show- already established ecosystem encouraged to speak their in the flood-hit state. the inspection of its formu- are for formulations (medi- ing interest, we can say that of pharma industry in Gujarat. minds and engage in philo- “Current operations will lations manufacturing unit cines), said H G Koshia, com- Gujarat will regain its lost glory A decade ago, Gujarat used sophical debates. remain suspended till the situated at Piparia missioner, Food and Drug by once again capturing 40 to enjoy over 45 per cent share But now the company, time Uttarakhand Civil (Silvassa) from August Control Administration per cent share in the pharma in drug manufacturing in stung by recent controver- Aviation Department 19 - 23. FDCA, Gujarat. manufacturing sector in the India. However, with some sies, is trying to rein in its Authority (UCADA), State “At the conclusion of the “FDCA's plant approval next couple of years.” states offering tax holidays to famously freewheeling The right-wing news site employee breaks the compa- Disaster Relief Authority inspection, the US FDA committee has received The expansion of pharma attract investments in phar- employees. On Friday, The Daily Caller later ny’s policies for workplace (SDRA), and operators make issued a Form 483 with around 300 fresh applica- sector in Gujarat is also sup- ma, it led to migration of some Google issued new work- revealed that the employee discourse, the team may a standard operation proce- three observations. The tions for pharma units in the ported by one of the lowest units from Gujarat which still place guidelines that had urged Google colleagues remind those employees dure for such operations,” company shall be submit- recent times and roughly 4-5 drug failure rates in the coun- had taxes then. ordered its staff to refrain to raise funds for a bounty about the rules. The team said an order issued by ting its comprehensive new applicants approach the try at 1.69 per cent, below the “However, the tables have from insulting one another, to find a person who can also “take other actions DGCA Arun Kumar. The response on these observa- committee for approvals of national average of 4.5 per turned now as the 10 year tax from making misleading punched Richard Spencer, a as appropriate in response to order was reviewed by tions to the USFDA within their plant design every cent, said Koshia. Gujarat has holiday offered by these states comments about the compa- prominent white nationalist, significant or repeated poli- Business Standard. the stipulated time frame,” week,” Koshia said on the the highest number of World is nearing its end. Moreover, ny and from “disrupting the in the face. cy violations,” Google said However, if required, the the firm added. sidelines of an industry event Health Organisation (WHO) GST has provided a level play- workday to have a raging As Google’s work force on Friday. permission may be granted The company said it is here on Tuesday. complaint pharma units at ing field with tax rates becom- debate over politics or the swelled past 100,000 The public got its first at the request of the state gov- committed to address these So much so that on the 642, he said, while adding that ing common across every latest news story.” employees and the nation’s view of the internal rancor ernment, along with techni- observations promptly. back of the fresh investments there were 124 units approved state,” said Koshia. “Our primary responsi- politics became even more at Google after the leak of an cal assistance by the DGCA. The US health regulator in drug manufacturing facili- by the USFDA. “Most of these Meanwhile, not just phar- bility is to do the work we’ve partisan, Google’s culture employee’s memo that sug- On Wednesday, (August 21) a issues observations by ties, the state government units are in formulations ma manufacturing but even in each been hired to do, not to has become a flash point. gested women were less bio- chopper of Heritage Aviation means of Form 483 notify- anticipates Gujarat's share in where Gujarat holds a lead,” pharma machinery Gujarat is spend working time on Employee walkouts have logically suited to be engi- hit apple cart cables immedi- ing the company's manage- India's pharmaceutical pro- he added. As per the state one of the leading states in the debates about non-work top- quashed several projects and neers than men. The memo ately after taking off, killing ment of objectionable duction to go up from the cur- FDCA commissioner, the state country. “India's 40 per cent ics,” the guidelines read. political debates on internal provoked an internal three people including the conditions at the rent 33 per cent to nearly 40 has benefited from the intro- pharma machinery comes The new rules are a message boards have grown firestorm, and Google fired pilot and engineer. facility inspected. per cent in the next couple of duction of Goods and Services from Gujarat,” Koshia added. marked departure from so rancorous that they have the engineer who wrote it, Two days later, a chopper Google’s unrestrained cul- drawn the ire of Mr. Trump. setting off political backlash of Aryan Aviation also hit an ture that, along with the In the rules issued Friday, from conservatives and fuel- apple cart cable and crashed. workplaces of its Silicon Google urged employees to ing more news coverage. However, there was no loss of Valley neighbors, was once be careful in their comments That incident prompted human life in this incident. Birlasoft stabilises structure after merger held up as a model for cor- about the company. Google to update its work- The aviation regulator has porate America. But those “We’re all free to raise place rules to order employ- also asked state authorities to NEHA ALAWADHI services, KPIT will focus on financial services and Birlasoft reported a companies have learned that concerns and respectfully ees to keep Google “a safe, form a database of terrain New Delhi, 24 August automotive engineering and insurance). These are the sequential fall of 36.7 per cent encouraging employees to question and debate the productive, and inclusive maps that includes proper mobility solutions. industries which will be our in consolidated net profit for speak up in office forums company’s activities — environment for everyone.” identification of obstacles Birlasoft is working on Kapoor sees some areas core focus areas while we also Q1 at ~41.8 crore. This was due can also court trouble. that’s part of our culture,” The company explicitly such as cable,wire, electric stabilising its structure after where there is good work with our customers in to changes in tax structures, The latest controversy the guidelines read. “Be sure banned “trolling, name call- pole, and pylon, etc. merging with KPIT, said CEO opportunity to cross-sell “to the energy and utilities along with the impact of a centered on a former Google to speak with good informa- ing, and ad hominem "The database should be Dharmender Kapoor. the clients that were there space," Kapoor said. one-time gain in the employee’s accusations that tion. Don’t assume you have attacks.” maintained by the state dis- “That's my first (earlier) because KPIT sold “There is much Birlasoft earlier quarter. he was fired for his conser- the full story, and take care Months later, activists aster relief authorities, and priority...it is a matrix ERP services, whereas emphasis given to reported a The June quarter vative viewpoints and that not to make false or mislead- inside Google discovered be provided to operators structure that we have,” he Birlasoft sold digital”. The training of employees 36.7% was lacklustre for the company aimed to help ing statements about their power when they suc- who want to provide service said. plan is to hire ‘strong leaders’ on our offerings, to sequential fall most mid-cap Indian President Trump’s opponent Google’s products or busi- cessfully pushed executives in the state," Kumar said in The two companies and train employees in new make it smoother for in consolidated IT service firms, with in the 2020 election. After ness that could undermine to change the company’s the order. underwent a merger and technology. them to target the right net profit, to client pressure and Fox Business Network aired trust in our products and the sexual-misconduct policies Over the last few weeks, demerger, resulting in the “Three different sectors set of clients, ~41.8 crore in Q1 visa costs eating into an interview with the man, work that we do.” and halt work on projects Uttarakhand has seen floods creation of separate and which will get most attention understand the market growth numbers. Mr. Trump tweeted that Google also said on such as artificial intelli- and multiple landslides in publicly listed entities KPIT from our side would be better and recognise the Client spending was also low. Google’s alleged actions Friday that it was hiring a gence developed for the the state, on account of Technologies and Birlasoft. manufacturing, life segments they need to work However, many say their were “all very illegal.” He team dedicated to moderat- military. excessive rainfall that While the latter operates in sciences/health care, and the towards," he added. revenues will be helped by added: “We are watching ing employee discussions on prompted helicopters to be information technology financial industry (banking, Earlier this month, inorganic growth. Google very closely!” internal forums. When an © The New York Times pressed into service. 4 YOUR MONEY MUMBAI | 25 AUGUST 2019 1 >

TAXATION BS TUTORIAL

Jayant Pai Enhanced limits to reduce Financial literacy 1. Which of these companies has not touched the $1 trillion market capitalisation mark, till date? A. Amazon pending direct tax litigation B. Microsoft C. Alphabet (Google) Retrospective application of CBDT’s circular by the appellate tribunal of Ahmedabad will also help achieve this end D. Apple

SURESH SURANA rospective applicability. 2. Which country's bank was the first to offer a recent circular (number 17/2019) Tax effect to exclude negative interest-rate mortgage loan? interest and penalty issued by the Central Board of A. Sweden ADirect Taxes (CBDT) on August In case the chargeability of interest is 8, 2019 is in one stroke set to dramati- the issue under dispute, the amount B. Finland cally reduce pending direct tax litiga- of interest shall be the tax effect. In C. Iceland tion. The monetary limit of “tax effect” case of penalty orders, the tax effect for filing of cases by the Income-Tax will mean quantum of penalty delet- D. Denmark Department has been revised signifi- ed or reduced in the order to be cantly upward compared to the limits appealed against. in the earlier circular no. 3 of 2018. The 3. Which company was recently held responsible for limit for filing appeal before the In case of composite orders precipitating wildfires in California? Appellate Tribunal has been increased It has been clarified in the recent cir- A. Pacific Gas and Electric from ~20 lakh to ~50 lakh, the limit for cular that in the case of a composite B. Southern Califronia Edison filing of appeal before the High Court MASSIVE BACKLOG order of any High Court or appellate has been increased from ~50 lakh to ~1 authority which involves more than C. Sierra Energy Appeals pending and tax effect locked up for past three years crore, and the limit for filing an appeal The Finance Ministry’s annual one assessment year and common D. Nanogrid before the Supreme Court has been ITAT HC SC report for 2017-18 summarizes issues in more than one assessment increased from ~1 crore to the pending appeals and tax year, no appeal shall be filed in Financial No. Amount No. of Amount No. of Amount ~2 crore. effect. It indicates that a huge respect of assessment year or years in 4. The Cadbury Committee was set up to specifically Further, in a landmark ruling dat- year of cases (~crore) cases (~crore) cases (~crore) number of cases are pending which the tax effect is less than the address the issue of ______in the United ed August 14, 2019, the Income Tax 2015-16 91,971 135,983 32,138 161,417 5,399 7,091 and a significant amount is monetary limit. In cases where the Kingdom in 1992. Appellate Tribunal (ITAT) composite order involves more than 2016-17 92,388 143,770 38,481 287,817 6,357 8,047 stuck in litigation. At least 30 Ahmedabad in the case of ITO Vs. per cent of cases will be one assessee, each assessee is to be A. Insider trading Dinesh Patel (ITA No. 2017-18 94,481 166,016 38,864 315,107 5,876 9,877 covered by CBDT’s circular dealt with separately. B. Labour unionism 1398/Ahd/2004) disposed of approx- The above provision was also there imately 628 appeals in which the tax in the earlier circular and the above C. Corporate taxation effect was less than ~50 lakh. income assessed and the tax that August 8, 2019 is not a standalone except for the amendments made in provision regarding composite orders D. Corporate governance The annual report of the Finance would have been chargeable had circular. It is to be read in conjunc- clauses 3 and 5 by the recent circular is in consonance with the earlier pro- Ministry for financial year 2017-18 such total income been reduced by tion with the CBDT circular no. 3 of of 2019. As such, based on the inter- visions and provides for distinct deter-

summarizes the pending appeals the amount of income in respect of 2018 (and subsequent amendments pretation of the Ahmedabad mination of tax effect for each year in

and tax effect. It is an indicator of the issues against which appeal is to it). All it does is replace paragraphs Tribunal’s ruling, it can be inferred case of composite orders. failures. and scams

the huge number of cases piled up or intended to be filed. 'Tax effect' three and five of the said circular. that all pending matters for earlier corporate of issue the with deal to Cadbury Adrian

It was set up in 1991 under the chairmanship of chairmanship the under 1991 in up set was It

pending and the significant amount includes surcharge and cess. In cas- Further, it noted that all other por- periods even before 2018 shall also be SC’s quashing of SLPs is D. 4.

stuck in litigation (see table). es where returned loss is reduced or tions of circular no. 3 of 2018 have eligible to claim the benefit of the encouraging fall. last homes 5,000 over razed

The CBDT circular has come at assessed as income, the tax effect remained intact. enhanced limit. It is worth noting In a welcome and swift move, even and people 15 least at killed that fires several of an appropriate time. It will provide would include notional tax on dis- It referred to para 13 of circular that the main appeal decided by the the Supreme Court, in a few matters cause primary the was equipment electrical PG&E

much needed respite to business puted additions. no. 3 of 2018, which remains intact. ITAT Ahmedabad in the case of ITO vide its various rulings, has dis- California state investigators alleged that faulty that alleged investigators state California

entities and taxpayers, who are This para reads as follows: “This vs. Dinesh Patel was for assessment missed Special Leave Petitions (SLPs) A. 3.

already facing the onslaught of slow- Implications of Circular will apply to SLPs/ appeals/ year 1998-99. While ruling on this, filed by the income-tax department, paid. has

down in business and tightening of ITAT–Ahmedabad’s ruling cross objections/ references to be the ITAT observed as follows: “The wherein the tax effect was less than borrower the than more by month each reduced

liquidity conditions. It is expected As mentioned above, the ITAT filed henceforth in SC/HCs/Tribunal lead case before us is an appeal filed ~2 crore. be will outstanding amount the but repayments,

that at least 30 per cent of cases will Ahmedabad, in the case of ITO vs. and it shall also apply retrospective- over fifteen years ago by the Income Thus, the above developments monthly make will Borrowers annum.

be covered by this circular. It will Dinesh Patel (ITA No. ly to pending SLPs/ appeals/ cross Tax Officer and it deals with an will dramatically reduce pending per 0.5% (-) at deal 10-year a borrowers offered

Jyske Bank, Denmark’s third largest, recently largest, third Denmark’s Bank, Jyske enable the appellate and judicial 1398/Ahd/2004), disposed of approx- objections/references. Pending assessment year which pertains to a direct tax litigation and improve the D. 2.

authorities to focus on high-value lit- imately 628 appeals in which the tax appeals below the specified tax lim- period over twenty years ago. Yet, business environment. This coupled

igation and clear the massive backlog effect was less than ~50 lakh. It ruled its in para 3 above may be with- the matter had not reached finality with the scheme for indirect tax dis- 2019). April (In billion 968

It's peak market-capitalisation was around USD around was market-capitalisation peak It's of pending cases. Next, let us turn to that it does not have slightest hesita- drawn/not pressed.” and the revenue’s challenge to the putes settlement, which will become C. 1. some of the key points of the circular tion in holding that the concession relief granted by the Commissioner operative shortly, will result in a new Solutions and their implications for taxpayers. extended by the CBDT not only Retrospective applicability may (Appeals) had remained undecided. era of swift resolution of tax disputes applies to appeals filed in the future be for older cases too That is nothing but prolonged agony and the end of multi-stage, never- What is tax effect? but equally to those pending for dis- As circular no. 3 of 2018 was in super- of uncertainty to taxpayers.” ending litigation. The quiz master is head - marketing, PPFAS Mutual Fund The term ‘tax effect' means the dif- posal currently. session of the earlier circular no. 21 of However, no official clarification Send your queries and feedback at [email protected] ference between the tax on the total It held that the circular dated 2015, it is a complete code in itself, has been issued by the CBDT on ret- The writer is founder, RSM India

ECONOMY 1 > FROM PAGE 1 > Arun Jaitley... scrap provisions of Article 370. that persuaded the doubters that the coming when he began “Arvind, main apps and other offerings which serve PEOPLE IN THE NEWS BINAY SINHA Jaitley was born into a Punjabi somewhat radical recommendations tumhe ek cheez bathaoon…” as a distribution channel for OTTs The prime minister, currently on a refugee family from Pakistan, in Delhi of the 14th Finance Commission Arun Jaitley will be badly missed. and earn revenues for the TV brands. three-nation tour, tweeted: “With the on December 28, 1952. His father was a should be adopted, to preserve He was articulate, master of the brief, OnePlus, which partnered with demise of Arun Jaitley ji, I have lost a lawyer, and mother a homemaker. He Constitutional propriety. The deft the shepherd of many a successful Netflix to have the OTT app pre- valued friend, whom I have had the started his political career as a student maneuvering with opposition politi- legislative effort, the man who mid- installed in its new OnePlus 7 hand- honour of knowing for decades.” He leader of the Rashtriya Swayamsevak cians in the Centre and politicians of wifed the GST, and the indispensa- set, is exploring similar partnerships said he had spoken with Jaitley’s fam- Sangh’s student outfit, the Akhil all stripes in the states, enabling the ble Rajya Sabha politician-parlia- for its TV offering, founder Lau added ily members. Bharatiya Vidyarthi Parishad (ABVP). GST to be passed into law. The patient mentarian who had more influence in the blog post. Jaitley and Modi had known each In 1974, he was elected president presiding over long and tedious GST than perhaps he himself realised, The idea is to capture the screen- other since the Emergency days. With of the Delhi University Students’ meetings that helped build the tradi- while wielding it less than he perhaps time of the average consumer, Modi as Gujarat chief minister, Jaitley Union. On June 26, 1975, hours after tion of decision-making by consen- ought to have. Above all, he was explains Tarun Pathak, Associate helped him and Shah with litigation the Indira Gandhi government had sus in the GST Council. humane, helping, and helpful. Director, Counterpoint Research. and central government probes in cas- proclaimed the Emergency, Jaitley led I'll also remember his generous We consequently mourn for him “TVs are now coming with com- es related to an alleged fake encounter a protest of Delhi University students, spirit and concern for others, which deeply. But we also mourn for our- puter-styled operating systems, in Gujarat as also into the communal the first protest against the Emergency would lead him to intervene time and selves, conscious that his sharp mind, which allow consumers to access a rioting in the state in 2002. in the entire country. He was arrested time again for worthy causes. For sober head, and restraining hand will range of video apps, games and oth- Jaitley mentored two generations under the draconian Maintenance of example, on behalf of my colleagues forever be unavailable as India navi- er services. And this is enhancing of BJP’s younger politicians, includ- Internal Security Act, or MISA, and for medical help or to get land allotted gates its uncertain economic and the stickiness of consumers towards ing Union ministers Piyush Goyal, spent the next 19 months in jail. so that junior Indian Economic political future. smart televisions.” Nirmala Sitharaman, Prakash On the anniversary of the Service (IES) officers could live in Javadekar, Anurag Thakur, and min- Emergency last year, Jaitley wrote that decent housing. There was also a The writer is former chief economic isters in Uttar Pradesh Shrikant he “got the privilege of organising the phone call to help restore the advisor Debt of 195 firms... Sharma and Sidharth Nath Singh. only protest on the morning of June 26, Ramkinkar Baij statues at These companies will now have to He is survived by his wife Sangeeta, 1975 and became the first satyagrahi Shantiniketan. depend on internal accruals to manage daughter Sonali, and son Rohan. Both against the Emergency”. “Little did I Nothing illustrates that core Smartphone... debt servicing and fund operations, his children are lawyers. realise that at a young age of 22 years, decency and thoughtfulness of Arun Experts tracking this space believe raising risk of a debt default or corpo- From AIIMS, Jaitley’s body was tak- I was participating in events which Jaitley as the planning for his daugh- that the entry of smartphone brands rate failure if the economic downturn en to his residence in South Delhi’s were going to be part of history. For ter's wedding. The main reception into this segment will likely usher in gets longer than anticipated. Kailash Colony, where hundreds paid me this event changed the future was a roll call of India's Who's Who, a new sub-category of smart TV at Access to fresh capital is essential Chairman N Chandrasekaran has said Tata their tributes to him. He will be cre- course of my life,” he said. from politicians, sportsmen and highly attractive prices, resulting in for the survival of many of these Sons, the holding company of the $110-bn mated on Sunday afternoon. Sources Jaitley earned his law degree in titans of industry to Bollywood stars, stiff competition amongst the players. financially stressed firms, given their Tata group, after resolving high leverage at said the PM was unlikely to cut short 1977. After the BJP was formed in April lawyers, and media moghuls. But Mr. Xiaomi entered the smart TV space in poor financials including losses in his foreign visit and stick to his itiner- 1980, Jaitley was active in its youth Jaitley made sure that the nearly February 2018 with the launch of Mi recent years. For example, 72 out of flagship operating companies, will now look ary of returning on Tuesday. wing but decided to focus on his legal 2,000 drivers, who had ferried these LED Smart TV 4 at a price of ~39,999. these 192 companies with inade- to fund growth across businesses Former prime minister practice. In 1989, the VP Singh gov- rich and famous to the event and who Since then, it has come out with low- quate m-cap had a combined loss of Manmohan Singh, Home Minister ernment appointed him additional were braving the cold Delhi er-priced models, with the cheapest ~1.14 trillion. Amit Shah, and politicians cutting solicitor general and tasked with the December night in dispersed parking — a 32-inch LED TV — selling for as Not surprisingly, many analysts across party lines condoled Jaitley’s probe in the alleged Bofors scam. spots were not forgotten: All of them little as ~12,999. In May this year, expect a fresh round of default in cor- death. Senior BJP leader L K Advani In 1991, the BJP inducted him into received hot meals and were kept Xiaomi said it had sold 2 million units porate India if earnings drought said Jaitley was “inducted into the its national executive. During the warm with cups of hot tea. of Mi TVs. stretches beyond a few quarters. BJP core team” when he was party tenure of the second Atal Bihari On a personal level, I will never Micromax, which started selling "We see another round of bad chief. He said Jaitley was “someone Vajpayee government in 1999, Jaitley forget my first meeting with him, smart TVs in 2016-17, recently loans in the corporate sector as cor- who valued and nurtured his friend- was inducted into the Union council of characterised by a quick sense of our announced its plans to launch a range porate earnings and valuations take a ship with people across the political ministers and elected to the Rajya mutual liking, followed by a midnight of Android-powered smart televisions, hit from the slowdown in global trade, spectrum” and “a food lover, he never Sabha. He was elevated to Cabinet rank call asking me to come immediately starting at ~13,999. According to IDC, decline in domestic demand, and failed to recommend good restaurants a year later. Jaitley handled the port- to take over the job of Chief Economic in the first quarter of 2019, Xiaomi growing stress in consumer-oriented to me”, Advani said. folios of information and broadcast- Advisor. The lunches in his office had a 39 per cent market share in sectors," said Dhananjay Sinha, chief Starting his career as a student ing, shipping, law and justice, and the after he became ill, when he, the leg- smart TVs in volume, followed by LG economist and equity strategist at leader in the 1970s and a lawyer by pro- newly created disinvestment. The par- endary foodie, could only peck at at 15 per cent and Sony at 14 per cent. IDFC Securities. fession, Jaitley emerged as a quintes- ty appointed him one of the general plain paneer and boiled egg while he The entry of phone-makers into the In the past, many corporate fail- sential Delhi politician in his 45-year secretaries in 2002. offered me multiple, sumptuous smart TV segment comes at a time ures or defaults were preceded by a public life. He had scores of friends After the Vajpayee government lost dishes. The affectionate way he would when over-the-top (OTT) video plat- sharp fall in the company’s m-cap in and admirers across the political spec- power in 2004, Jaitley resumed his greet me every time I entered, even forms such as Netflix, Hotstar, Zee5 2012 and 2013, making it tough for trum, in the legal profession, media, legal practice but remained active in barged into, his room; and his gentle and Amazon Prime Video are wit- companies from financially stressed and industry. the party. With the death of Pramod ribbing about my “liberal friends”. nessing a strong growth in India. sectors to raise fresh capital. Jaitley never had a mass base, los- Mahajan in 2006, Jaitley and Sushma Perhaps most important, I will According to a May report by ing the only Lok Sabha election he con- Swaraj, who passed away on August 6, remember the engagement with my Google, India’s online video audi- tested, but his colleagues and politi- emerged as the BJP’s key leaders in ideas-even when he publicly dis- ence is expected to touch 500 mil- Govt to offer ... cal rivals alike acknowledged his Parliament. He was also associated agreed with them, such as on the bad lion by 2020, with an estimated 40 To achieve the target of reducing qualities as a keen political strategist, with Delhi’s cricket administration. In bank, universal basic income, and a million Indians coming to the crude oil imports by 2022, state-run and benefitted from it. 2009, he was elected as vice president simplified GST rate structure. The Internet every year. companies have increased their share Ill-health forced Jaitley to opt out of the BCCI. support he gave when I had to strad- With Reliance Jio’s launch of of investment in the recent years. of the Cabinet of the second Modi dle the conflicting tugs of loyalty ver- JioFiber home broadband, house- Between 2016-17 and 2018-19, ONGC Cigarettes-to-hotel conglomerate ITC plans government, which took office on sus objectivity. The long conversa- hold video and content consump- made an investment of about ~75,000 May 30. He continued to tweet on A personal tribute tions we had in his living room at 2 tion is expected to rise even further. crore, while Oil India ~9,689 crore in to increase the salary of CMD Sanjiv Puri by political developments and penned In July, he was visibly more frail and Krishna Menon Marg, in his stately Jio, which has garnered over 300 exploration and production activities. more than 45% and the remuneration of his last blog on August 6. Titled “PM the conversation dwelt more on his office in North Block, and especially million mobile subscribers in the Investments made by private and joint three executive directors by 30% in the Narendra Modi and HM (Home health. in the small, dark adjoining chamber three years since it went live, will venture companies during the period Minister) Amit Shah Achieve the What memories will I carry of Arun to which he would retire for his after- offer its home broadband service for were $562 million under the produc- absence of stock options for them Impossible”, Jaitley lauded the gov- Jaitley? Obviously, his political skills. noon siesta. I knew something just ~700 a month. tion sharing contract regime, which ernment for getting Parliament to His brilliant intervention in Cabinet insightful or intimate (or juicy) was Smart TVs have pre-installed OTT was in place before the OALP. 6 ECONOMY & PUBLIC AFFAIRS MUMBAI | 25 AUGUST 2019 1 > Niti Aayog is No extra surcharge on FPIs for derivatives, too

PRESS TRUST OF INDIA assets and the gains arising from the including exemption of start-ups caught in EV New Delhi, 24 August transfer are treated as capital gains. from ‘angel tax’, a package to They are subject to a special rate of “THE GOVERMENT HAS address distress in the auto sector he government on Saturday tax as per provisions of the Income TAKEN CARE OF and upfront infusion of ~70,000 cross-currents clarified that enhanced sur- Tax Act. SECTORS RANGING crore to public sector banks. T charge has been withdrawn “Therefore, it is also decided that Meanwhile, Vedanta Resources BS REPORTER on all issues unless there was for foreign portfolio investors (FPIs) the tax payable on gains arising FROM MSMEs TO AUTO executive chairman Anil Agarwal New Delhi, 24 August a policy announcement. on capital gains in both equity and from the transfer of derivatives said these comprehensive measures He was speaking soon derivatives segments. (futures & options) by FPIs, which AND FROM NBFCs TO will ensure adequate liquidity, The Centre’s primary think after the RSS-affiliated The Centre on Friday had are liable to special rate of tax BANKS, THEREBY sufficient demand creation and tank NITI Aayog has been at Bharatiya Mazdoor Sangh announced a litany of meas- under Section 115AD of the cheaper loans. the receiving end, mostly on (BMS) had blamed Niti ures to boost the economy. (Income Tax) Act, shall also ENSURING ADEQUATE “The goverment has taken care issues linked to electric Aaayog for killing jobs in the They include rollback of be exempted from levy of LIQUIDITY, SUFFICIENT of sectors ranging from MSMEs vehicles (EVs), over the last context of its EV push. enhanced super-rich tax the enhanced surcharge,” (micro, small & medium enterpris- few days. Sometime back, NITI on foreign and domestic MINI it said. DEMAND CREATION es) to auto and from NBFCs (non- If Transport Minister Aayog was also caught in equity investors imposed BUDGET However, tax payable at banking financial companies) to Nitin Gadkari said on Friday cross-currents with the in the Budget. the normal rate on business AND CHEAPER LOANS” banks, thereby ensuring adequate that it was the mandate of Ministry of Electronics and Derivatives (futures and income arising from the ANIL AGARWAL liquidity, sufficient demand cre- his ministry and not that of Information Technology options) are not treated as capital transfer of derivatives to a person executive chairman ation and cheaper loans,” he said. NITI Aayog to take a call on over who would take owner- assets and the income arising from other than FPI shall be liable for the Vedanta Resources He added that confidence of for- vehicle technology, ship of a government pro- the transfer of derivatives is treated enhanced surcharge, it added. eign investors will be boosted with Commerce Minister Piyush posed artificial intelligence as business income and liable for In the 2019-20 Budget, the gov- the removal of enhanced surcharge. Goyal had earlier stated that centre in India. normal rate of tax for domestic ernment had increased surcharge ~5 crore. cent from 35.88 per cent and for “We are confident that more the government viewpoint NITI Aayog had circulat- investors, an official statement said from 15 per cent to 25 per cent on Following increase in the sur- those above ~5 crore to 42.7 per cent. steps will be taken in the coming did not always match that of ed a Cabinet note, asking for on Saturday. taxable income between ~2 crore charge, the effective income tax rate The government on Friday had days to boost economic growth so the think tank. ~7,500 crore for three years However, in the case of FPIs, and ~5 crore, and from 15 per cent to for individuals with taxable income announced a raft of measures to that GDP can attain its true poten- Gadkari was to set up an AI derivatives are treated as capital 37 per cent for income above of ~2-5 crore has gone up to 39 per revive the growth momentum, tial of 8-9 per cent,” Agarwal said. addressing indus- framework. try concern at a Transport MeitY’s plan esti- conference over Minister Nitin mated an expendi- Niti Aayog’s tough Gadkari said on ture of ~470-480 Sops likely to spur stance regarding Friday that it crore. Auto firms unsure if benefits stopping registra- was the Last year, four tion of vehicle mandate of his panels set up by using Internal ministry and MeitY had evaluat- motor insurance Combustion not that of NITI ed the use of AI for will be seen in festive season Engines (ICE) to Aayog to take a citizens, such as set- promote the use call on vehicle ting up a data plat- T E NARASIMHAN said Srinivasan. companies’ growth of EVs. technology form, skilling and Chennai, 24 August HITTING THE BRAKES Shashank Srivastava, exec- NITI Aayog has reskilling, research „The passenger vehicles industry saw utive director, marketing & SUBRATA PANDA makers. “This positive meas- been at the forefront of the and development. While the sops announced by a 19 per cent fall during Q1 sales, Maruti Suzuki, said the Mumbai, 24 August ure should lead to tax coming Centre’s move to promote It also concerned itself Finance Minister Nirmala „Economic slowdown, liquidity government’s moves are good down for client businesses, EVs to cut down on pollution. with examining the Sitharaman on Friday to revive crunch and confusion over BS-IV in the long run and will posi- The motor insurance segment implying higher profitability In fact, at a recent meeting challenges involving legal, the automobile industry are vehicles continuity to be blamed tively boost sentiment in the of non-life insurers, which due to lower effective cost on with top automakers, senior regulatory, ethical and expected to help in the second short term, just ahead of the reported the slowest growth new vehicles. Aayog members took a tough cybersecurity aspects. half, the industry is divided “We are optimistic that this festive season. in the last five quarters The measures have no stand on fixing a timeframe MeitY’s reports have not when it comes to its effect on move will boost customer For revival, the rural story because of negative sales direct impact on premium. for rollout of EVs for two- been made public. the festive season. sentiment... But how much is important. Last year, the trend in automobiles, may see However, they should aug- wheelers and four wheelers. New age technologies like This period accounts for it will be effective, we need company reported an overall a revival after finance minister ment sale of new vehicle, thus They also laid out the AI fall under the purview of nearly 25 per cent of the over- to wait and watch” growth despite slowdown in Nirmala Sitharaman’s sops improving opportunity for options that the government the MeitY but NITI Aayog all automobile sales. VIKAS JAIN, national sales urban market. This is on Friday. insurance companies,” said could take to ensure that has spearheaded several dis- The passenger vehicles because the rural market The Finance Minister, Rakesh Jain, executive direc- head, Hyundai sales of vehicles based in ICE cussions on the subject. industry saw a 19 per cent fall grew by 10 per cent. among other measures for the tor and chief executive officer engines could be lowered. Analysts pointed out that during Q1 and in July it was Enquiry levels for the com- auto sector, had announced (ED & CEO), Reliance General That had triggered a chain of any independent think tank nearly 30 per cent. Srinivasan said sentiment and boosts sentiment, he said. pany’s petrol range this year revision of one-time registra- Insurance. reactions from major is meant to hold opinions on This was because of slow- cash flow were major challenges “Will it (revival) happen in are good for the current fes- tion fees and bettering infra- Slowdown in sale of new automakers. various matters, which could down in the economy, poor and they have been addressed. 3-6 months? I wont be able to tive season (better than last structure. She also said a vehi- vehicles has impacted the In the case of Goyal, he be at variance with govern- sentiment, liquidity crunch After announcement of predict. But I do expect that year’s), but this may not cle acquired from now to growth in premiums for the said at a recent global semi- ment’s stand. and confusion over BS-IV vehi- the measures, the sentiment by January, there would be a reflect on wholesale numbers, March 2020 will attract an motor insurance segment. nar that NITI Aayog as an In the case of EV though, cles continuity, among others. has improved. The govern- pick up. You can’t do some- considering dealers already additional 15 per cent depre- Premiums collected from independent think tank the matter has been settled On Friday, Sitharaman ment is finding bottlenecks thing in September and think have inventory. ciation rate, thereby taking the motor insurance segment comes up with new solutions for now as the government announced a slew of meas- and removing them. The gov- that in October it will start This year, both rural and the entire depreciation rate to contribute close to 38 per cent constantly and that its view has clarified that no dead- ures, including improving liq- ernment is keen to listen to improving. I definitely believe urban markets have reported 30 per cent. of the overall collection from may not match that of the line has been set for a shift to uidity, to boost demand. the stakeholders. That again that from January, there will around 18 per cent fall in the The enhanced depreciation various segments for the non- government all the time and the new technology. TVS Motor chairman Venu is very positive and also be green shoots of growth,” first quarter. is expected to motivate vehicle life industry.

HEALTH 1 > Microplastics FIT & PROPER in drinking Your weekly health guide How many steps should water pose a Busting IVF myths low risk: WHO Fact: It is, by and large, an out- you take in a day? patient treatment. Only the egg-collection procedure requires day-care admission. Fitness trackers have bolstered the case for even light exercise. The persistent mystery, though, is It does not require overnight admission. There's no need to which movements matter the most put your life on pause after the embryo transfer. The out- KIM TINGLEY published, in JAMA Internal comes may be better in 24 August Medicine, one of the first stud- patients without bed rest. ies to examine the relationship NITIZ MURDIA Myth 4: Lifestyle modifica- umans, once in con- between steps and mortality, Director, embryology and marketing, tions (diet, exercise, quitting stant motion as inspired partly by a workplace STEPHANIE NEBEHAY Indira IVF Hospital smoking/ alcohol/ substance Hhunters and gatherers, exercise competition she had Geneva, 24 August abuse/ stress-free lifestyle) are moving less than ever. At entered that used Fitbits. Many Medical science has made will increase the success rates first, this trend seemed like of her colleagues, she noticed, Microplastics contained in great progress in treating infer- of IVF. progress: Transferring our felt discouraged by a popular drinking water pose a “low” tility. There has been an Fact: Maybe true. Poor nutri- heavy and dangerous work to goal of 10,000 steps. But that risk to human health at cur- impressive increase in the suc- tion can have an impact on fer- animals, then machines, figure, she learned, most likely rent levels, but more research cess rate of IVF over the years. tility. Women with a Body Mass enabled more people to live comes from the word for is needed to reassure con- Still, the beneficiaries are few. Index (BMI) over 30 or those longer. As recently as the 1950s, pedometers sold in Japan since sumers, the World Health Most others lack awareness, who are severely underweight doctors considered exercise the 1960s, manpo-kei, which Organization (WHO) has said. affordability, access and may have difficulties with fer- dangerous for people over age translates to “10,000 steps Studies over the past year assurance. Ethical and legal tility. Smoking or substance 40; for heart disease, which was meter” — a number apparently on plastic particles detected issues related to embryo trans- abuse (like marijuana, etc), can then killing a record number of chosen in part because the in tap and bottled water have fer and surrogacy also restrains dramatically affect sperm and Americans, they prescribed bed Japanese character for it looks sparked public concerns but the market in addition to a lack egg quality, which can have a rest. This was partly based on like a walking man. How many the limited data appears of established regulations. All significant impact on fertility. their concept of what “exercise” steps, Lee wondered, did people reassuring, the UN agency this has IVF surrounded by Based on research, scien- was: Early physiologists con- Lee’s study measured steps per minute and found that only the total number of steps, not how actually need to take to see said its first report on poten- many myths. Let us try to tists believe that stress can con- ducted studies on their (typi- quickly the women took them, seemed to matter health benefits? tial health risks associated address them. tribute to infertility. Although, cally young, male) graduate stu- To find out, she recruited with ingestion. it's not necessarily a direct dents or on military servicemen assessing performance on a lines, there was ample evi- Western countries spend nine more than 16,000 female vol- Microplastics enter drink- Myths vs Facts about IVF cause and other factors like low — and in order to become more treadmill test. Theirs is believed dence that the more “moder- to 11 hours per day sitting, and a unteers, whose average age was ing water sources mainly Myth 1: IVF has a 100% suc- sperm count and quality could fit than they already were, these to be the first long-term study of ate” to “vigorous” activity peo- growing body of research shows 72, to wear accelerometers dur- through run-off and waste- cess rate and IVF can resolve also contribute to it. subjects needed to work out men and women to show that ple reported doing, like brisk that among people who do sim- ing their waking hours for a water effluent, the WHO said. all infertility issues Also, a study by Korean hard. “The mantra was, you the higher a person’s fitness lev- walking or raking leaves, the ilar amounts of moderate to vig- week. Then she followed up Evidence shows that Fact: Not true. The success rate researchers found that women have to go to a gym, you have to el, the lower their risk of mor- lower their risk of diabetes, cer- orous activity, those who sit with them after about four years microplastics found in some of IVF is about 40% in couples who sleep seven to eight hours do high-intensity physical tality, especially from cardio- tain cancers and cardiovascu- longer have more adverse out- to see if they were still living. bottled water seem to be at below the age of 35. Also, the are more likely to have a suc- activity,” says Abby C King, a vascular disease and cancer. But lar disease. Now the depart- comes. “What are the people She found that increasing your least partly due to the bottling success rate of IVF depends on cessful IVF cycle than women professor of health research and physical fitness, they noted, is ment includes Alzheimer’s who sit less doing during the average step count by even a process and/or packaging factors, such as age, cause of who sleep more than nine policy and medicine at Stanford not the same as physical activi- disease, depression, anxiety time when the longer-sitters are small amount reduced your risk such as plastic caps, it said. infertility, and biological and hours or less than six hours. University: “this sort of ‘no pain, ty, the amount of movement a and insomnia and recom- sitting?” says Kenneth E Powell, of mortality — and that, among “The headline message is hormonal conditions. Myth 5: Infertility is almost no gain’ phenomenon.” person gets in the course of their mends that adults get at least a former epidemiologist with the older women in her study, to reassure drinking water There are many assisted always caused by problems That notion began to change daily life. The only way 150 minutes of moderate-to- the Centers for Disease Control those benefits plateaued at consumers around the world, reproductive procedures such with the female's reproductive with the 1968 publication of researchers could learn about vigorous exercise a week. and Prevention. “That differ- about 7,500 steps per day. The that based on this assessment, as ovulation induction (OI) with system. “Aerobics,” by Kenneth Cooper, the latter was by asking people Such a broad goal was nec- ence must be what we’ve now least-active women averaged our assessment of the risk is medications, Intra Uterine Fact: It's common for people an Air Force physician, who to describe their behaviour — a essary largely because activity called lighter physical activity.” about 2,700 steps per day; those that it is low,” Bruce Gordon of Insemination (IUI), etc. which to think of infertility as a female argued that anyone could take much less precise method than that takes place at a lower inten- Over the last decade, that who averaged just 1,700 more the WHO’s department of can help childless couples con- problem, but only 35 per cent of measures to prevent heart dis- measuring their cardiovascular sity for less than 10 minutes had activity suddenly became meas- than that, a difference of about public health, environmental ceive. IVF is just one of them. infertility cases are caused sole- ease with regular “aerobic” exer- capacity in a lab. been nearly impossible to study. urable in real time with the a mile, were 41 per cent less like- and social determinants of Myth 2: IVF is not safe. IVF ly by female factors. Another cise, like swimming or jogging, Not having an objective “We never asked about light- advent of iPhones and wearable ly to die of any cause. health, told a briefing. babies are born with birth 35 per cent results from factors that increases heart rate and way of measuring how much intensity physical activity, fitness trackers, many of which Lee’s study measured steps The WHO did not recom- defects and malformations. in the male reproductive sys- oxygen uptake, “improving the activity people were doing because we realised it’s poorly track “steps.” There’s no evi- per minute and found that only mended routine monitoring Fact: It is a safe procedure with tem, 20 per cent come from overall condition of the body” made it difficult to observe the reported,” says I-Min Lee, a pro- dence that steps are better for the total number of steps, not for microplastics in drinking only about 2 per cent of both and 10 per cent is unde- and thereby “building a bulwark full range of that activity’s fessor of medicine at Harvard health than other kinds of light- how quickly the women took water. But research should patients standing the risk of termined. against many forms of illness health benefits. Until 2008, the Medical School. “Putzing intensity activity; they just hap- them, seemed to matter. But focus on issues including becoming unwell from ovarian Myth 6: You have no control and disease.” But it was hard to federal government usually around your house, picking up pen to be a movement people devices can’t yet tell how steps what happens to chemical hyper-stimulation syndrome. over the success of an tease apart whether physical offered physical-activity rec- after yourself, doing a little bit of make often that is also are taken within each minute. additives in the particles once The absolute risk of delivering IVF cycle. activity made people healthier ommendations as part of its light gardening — how well do detectable. But these same qual- “One of the big questions is: they enter the gastrointesti- an IVF baby with malforma- Fact: The results of an IVF or whether healthier people official dietary guidelines, as a people remember that?” ities make them uniquely rele- Does every step count?” says nal tract, it said. tions is very low. It is same as in cycle are, to a large degree, were more likely to be active. In way of balancing energy intake Increasingly, though, there vant to researchers: Because so David Bassett, a co-author on The majority of plastic a spontaneous pregnancy. based on a thorough evalua- a landmark study published in with expenditure. But by that were hints that such activity many people are able to easily Lee’s study and a professor of particles in water are larger Myth 3: IVF requires admis- tion of the couple and there 1989, Cooper and colleagues year, when the United States might be more critical than pre- count their steps, it’s important exercise physiology at the than 150 micrometers in sion in a hospital and bed rest are a number of things doctor tried to address this problem by Department of Health and viously thought, especially as to understand the effect of steps, University of Tennessee. diameter and are excreted during and after the IVF treat- can do to increase the suc- considering subjects’ physical Human Services issued its first societies became more seden- per se, on health. from the body, said WHO . ment (embryo transfer) cess rates. fitness, a metric determined by set of physical-activity guide- tary. On average, adults in In May, Lee and colleagues © 2019 The New York Times News Service REUTERS MUMBAI | 25 AUGUST 2019 IN DEPTH 7 . <

his Wednesday, Himman Akhil Bhartiya Sant Shiromani Guru Kumar took leave from work Ravidas Mandir Sanyukt Sanrakshan as he joined tens of thousands Samiti, convened by Dalit rights T of people — bound by faith in activist Ashok Bharti, issued a state- a “lesser god” — at Delhi’s Ramlila ment. It said that then Union minister Maidan. For the Sanskrit schoolteacher, Babu Jagjivan Ram had laid the foun- like many others who gathered from The fight for a dation stone of the temple in 1959, places far beyond the capital, it was a which the DDA — created in 1957 — spontaneous response to the demoli- did not object to. tion of a temple of Guru Ravidas in The organisation also raised a slew South Delhi’s Tughlakabad area. of demands that included asking the The mega rally was followed by a DDA to allocate “the original land in march of some activists to the temple question” to the temple, its restora- site that took a violent turn and ended subaltern saint tion and to press the apex court to with the detention of Dalit outfit Bhim review its judgment. Army’s chief Chandrashekhar Azad Parmjit Kaur, also a member of and several others. ZPSC, says that in Punjab, a state with Kumar, who has been teaching at a Ritwik Sharmafinds out how a temple at the edge of Delhi became the rallying over 30 per cent Dalit population, government school in Delhi for a point for Dalit activists and politicians of all stripes there is strong awareness among the decade, had been to the temple just community. “We (ZPSC) seek one- once. But he shares the belief of the third of common lands reserved for sect’s followers that the guru spent time Dalits in Punjab. And we see the tem- at the site where the temple stood. ple demolition as part of the same RSS Emperor Sikandar Lodhi donated (Rashtriya Swayamsevak Sangh, BJP’s the land to the saint in the 16th centu- ideological parent) agenda that attacks ry, he narrates. “Lodhi initially aimed to Muslims, Dalits or communists fight- convert Hindu gurus, and through ing for their rights,” she says. them their followers, to Islam. But he Dalits fear that the upper caste- had a change of heart after Guru friendly forces want to grab their land Ravidas preached that one should be a and co-opt them in Hinduism by elim- human first before identifying with a inating a distinct identity, she adds. And religion.” Tughlakabad is a reflection of that. After the demolition on August 10, The guru’s verses, which are part of the entry to the temple has been Sikh scriptures too, envisioned a socie- blocked with a newly built wall, while ty where people are not divided on the police patrol its barricaded boundary. basis of caste or creed. The temple, located in the Rajinder Singh, a peasant leader Jahanpanah city forest area, was razed from Faridkot, Punjab, quotes a popu- down after the Supreme Court refused lar couplet of the guru — “Aisa chahu to stay a Delhi High Court order. A tem- raaj me jahan mile saban ko ann, chot- ple body, the Ravidas Jayanti Samaroh barein sab sam base, Ravidas rahe Samiti, claimed ownership of the land prasann.” (I wish for such a society and the shrine complex spread across where everyone gets a morsel of food, 2.5 acre and comprising 20 rooms and where equality among the big or small a hall. There is also a well, called the makes me content.) “Such a society is “Chamar johad”, at the disputed site. possible only in a socialist scenario. The origin of the temple itself precedes And whoever stands for such an idea Independence. gets targeted by the RSS,” he adds. The Delhi Development Authority The reactions indicate a palpable (DDA), which functions under the anger in the Dalit community. In this Union ministry of urban development, instance, the sense of sudden action though, has argued that the temple was on the part of the judiciary and admin- built in a protected forest area and thus istration touched a raw nerve, feels illegal. It had tried to demolish the Rajesh Kumar Paswan, associate pro- structure back in 1992, following which fessor at the School of Language, a 27-year legal battle ensued as the tem- Literature and Culture Studies in ple representative went to court. Jawaharlal Nehru University. From the accounts of people who Ravidassias of Punjab, among protested in Delhi, as well as those who (Clockwise from whom are Jatavs, have improved their called a bandh on August 13 in Punjab top) Police social conditions in the last 50 years or immediately after the apex court order, lathi charge so, a period in which many have set- it is apparent that the temple issue res- protesters on the tled abroad and also built temples to onated with the Dalit community. It way to the their deity there. Following last year’s includes tanners — pejoratively temple site in nationwide protests in April after the referred to with the caste term, Chamar Tughlakabad; amendment to the Scheduled Castes — who also adhere to the Ravidassia Congress leaders and the Scheduled Tribes (Prevention sect. The mystic poet himself was born P L Punia and of Atrocities) Act 1989, the rift between to a family of cobblers in Benares. Kumari Selja at a lower and upper castes has widened, The administrative action has invit- rally in New explains Paswan. ed expected counters from Ravidas fol- Delhi; Bhim “B R Ambedkar’s fight for the tem- lowers. An alternative site for the tem- Army chief ple rights of Dalits was about human ple is not acceptable to them. Why Chandrashekhar dignity, not to build temples. But this would you not do the same to the Ram Azad being has become an emotive issue,” he says. Mandir in Ayodhya? they ask. Another taken into police Anger further alienates Dalits from go-to retort is: Why don’t you also custody mainstream society as they are demolish the temples that are encroach- PHOTOS: PTI viewed with greater suspicion by the ing on public land across the country? rest, Paswan says, adding that Dalit Ajit Kumar, a marine engineer from leaders fan anger further. The aver- Siwan in Bihar, feels that caste is the demolition has found many takers appealed to Prime Minister Narendra Mukesh Kumar, 33, led over 500 ernment emissary came to address age youth is now looking up to a biggest obstacle to India’s dreams of among mainstream political parties, Modi to assuage tensions, while people who came from Sangrur in concerns. Second, even if they thought Chandrashekhar Azad, who is seen as becoming a superpower. “Guru Ravidas months before elections are due in Bahujan Samaj Party (BSP) president Punjab to Delhi under the banner of of going to Tughlakabad, there was no a rival by the BSP. spoke against discrimination and for Haryana, a state that also has a large sec- Mayawati has urged the governments the Zameen Prapti Sangharsh announcement on stage regarding it.” “Whatever development has hap- equality. His faith is for all sections. And tion of Ravidassia devotees. in Delhi to “find a middle path” and Committee (ZPSC), an organisation Some in the crowd that went to pened for the Dalit society has result- though saints have no caste, he is viewed On Thursday, the ruling Aam Aadmi rebuild the temple. BJP leaders, too, that has fought for the land rights of Tughlakabad got agitated and ed from a cooperation with the gov- as a Chamar saint,” he says. Party adopted a resolution in the Delhi have asked the Modi government to Dalits in the last five years. behaved like a mob because there was ernment, whoever be the party. This is Among the rest of the population, Assembly saying that the Bharatiya reconstruct the temple. The DDA, He says the Delhi agitation would no leader, he stresses. However, he not being understood by the Dalit including the upper castes, the saint Janata Party (BJP)-led central govern- meanwhile, has said it will allot land have been successful in pressing the adds, the issue won’t die down as dif- intelligentsia or youths who have occupies a peripheral position, although ment had mishandled the issue. It also afresh for the temple, if directed. demands, but it was lacking leader- ferent Dalit organisations are plan- remained in a war zone vis-à-vis the he ranks alongside other religious resolved to build a Ravidas temple at In the wake of the protests in Delhi, ship. “It was unorganised. Until after- ning to meet in Phagwara, Punjab, on government. The government in turn reformers who led the Bhakti movement the same site. there is an aftertaste of regret as well as noon, when the march began from Sunday and take the movement should address the genuine reasons that fought against the caste system. But In Punjab, Congress leader and cautious optimism among those who Ramlila Maidan, the crowd wasn’t sure forward. behind the anger and find solutions, the emotive response to the swift temple Chief Minister Amarinder Singh has took part in them. as to who would represent it if a gov- In Delhi, an umbrella body called but it doesn’t do so,” he says.

IMO Why luxury fashion is embracing recycled plastic Demonitisation/GST coupled with spectre of terror unleashed on even honest businesspersons From crocodile skins and animal welfare. In an industry juxtaposed with lack of understanding of where leather goods drive profits, economic issues by successive Finance Ministers of to cashmere wool, the Pinault is pushing tanneries to invest in NDA/BJP new processes for turning animal hides luxury industry is into supple handbags without employ- P CHIDAMBARAM ARRESTED BY CBI ing chromium, a pollutant whose use Ashoke Pandit@ashokepandit under more pressure remains widespread. Executives at Chidambaram is the only true Hindu who is going than ever before to Kering have even seen their bonuses to celebrate Krishna Janmastami in Jail ! tied to environmental performance prove its sustainable since 2010. Prashant Bhushan@pbhushan1 “We shouldn’t wait for people to Finance Minister Nirmala Sitharaman Art 20 of Const says no person can be compelled to credentials require us to use different materials be a witness against himself. So no accused before figuring out how,” Pinault said in STATE OF THE INDIAN ECONOMY person can be forced to make a statement to CBI. ROBERT WILLIAMS an interview. “It’s up to us to come up Amit Shah@AmitShah Yet SG says: Chidambaram must be subjected to with products that are respectful of the Measures to encourage investments in capital custodial interrogation since he is mentally strong! n a full moon at high tide each environment.” markets and facilitating the start up ecosystem, Want to extract statement by torture? spring, schools of grunion fish Consumers may associate pollution streamlining GST refunds and steps to quickly Oflop out of California’s coastal Social media and smartphones have made it easier for criticism of the fashion and waste in the apparel industry with resolve tax related issues will help our Kuljeet Singh Chahal@kuljeetschahal waters to spawn in the sand. industry’s environmental sins to spread fast-fashion retailers or sneaker mak- entrepreneurs and market sentiments. I People who are comparing Chidambaram with The beaches had a different set of ers, whose supply chains often lead to congratulate PM @narendramodi Amit Shah and calling it vendetta should attendees on one misty June evening: ural resources, such as metal hardware, shoe soles. Prada has said it wants to massive factories in loosely regulated for these progressive steps. remember one thing Amit Shah never ran away an army of spindly young men wearing leather skins, and cashmere, than ever source all of its iconic nylon accessories countries where labour is cheap. But from CBI or Police instead he did press conference Saint Laurent’s latest collection, includ- before. At the same time, the industry is from recycled materials including now the spotlight is widening to fall on Rahul Gandhi@RahulGandhi before surrendering and believed that he will ing gauzy button-ups, crystal-studded facing more pressure from consumers ocean waste by the end of 2021. luxury companies, too, as a new cohort Govt’s own economic advisors have finally come out clean. #ChidambaramArrested blazers and pointy leather mules. The and regulators to curb the environ- Leading the way is Kering, Saint of young, wealthy clients looks to avoid acknowledged what we cautioned for long - models paraded just a few feet from the mental impact of its rapid growth, heav- Laurent’s owner, whose other brands glamorous products that come with an India’s economy is in a deep mess. Karti P Chidambaram@KartiPC breaking waves of Malibu’s Paradise ily polluting supply chain and loose include Gucci and Balenciaga. unsavory backstory. Now, accept our solution and remonetise the What happened to the claims of millions of USD Cove as journalists, stylists and celebri- control of suppliers. Chairman Francois-Henri Pinault is Millennials and Generation Z will economy, by putting money back in the hands of being paid? Are the ty guests flashed their smartphones in “You have regulators, consumers, working to rally global fashion compa- account for four-fifths of the luxury the needy & not the greedy. @dir_ed and CBI conducting a trail by planted appreciation. and more and more the investors who nies around a new sustainability pact. industry's growth in the coming years, stories? The grunion were nowhere to be are making environmental and social French President Emmanuel Macron Jefferies analyst Flavio Cereda said in a Rahul Kanwal@rahulkanwal seen, an absence that generated angry criteria an important red flag,” said has put the issue on the agenda of the July report. Three-quarters of millen- India Inc wanted to see real action and not just OPPOSITION DELEGATION TO KASHMIR complaints and letters from Malibu Mario Ortelli, a London-based luxury Group of Seven summit he's hosting this nials said they’d alter their buying talk on the economic downturn. Major Gaurav Arya (Retd)@majorgauravarya townspeople and officials. In their sight consultant. month in Biarritz, tapping Pinault to habits on environmental concerns; the @nsitharaman has virtually read out the third How many politicians from New Delhi visited lines: Kering SA, owner of the Saint The industry is starting to wake up. spearhead the initiative. The Kering boss comparable figure for baby boomers union budget for 2019. Undoing hurtful economic Kashmir after Pulwama? How many have ever Laurent brand. The company has posi- Apparel makers including Giorgio is trying to get companies to sign on to was 34 per cent. decisions and providing renewed stimulus. Will be gone beyond Srinagar? How many stood with our tioned itself at the forefront of a move- Armani and Versace have discontin- targets that could include eliminating As in the aftermath of Saint interesting to see next move of corporate titans. soldiers? How many held the hand of Kashmiris ment to clean up fashion’s environ- ued the use of controversial materials, single-use plastics and accelerating their Laurent’s Malibu show, social media when they were in distress? After abrogation of mental impact but flew in participants like fur. Burberry Group vowed recent- transition to renewable energy. and smartphones have made it easier Mohandas Pai@TVMohandasPai Article 370, all flights to Srinagar are sold out. from around the world, releasing thou- ly to stop destroying unsold stock, a While Pinault’s brands spin a dream for criticism of the industry’s envi- Reforms, please, not stimulus: Sagging sectors of sands of pounds of carbon dioxide. widespread practice in the fashion of luxury, he’s also made sure that more ronmental sins to spread. Previous the economy should not expect bailouts from the Ashok Swain@ashoswai The luxury-goods business is walk- industry to avoid unwanted products and more of the looks on display are triggers included videos of suffering government Rahul Gandhi with a delegation of opposition ing a high wire. Fierce competition for being spotted in bargain bins. Industry produced from organic cotton, trace- crocodiles or cashmere goats at sites leaders visiting #Kashmir - 7 million #Kashmiris consumer dollars and for social media giant LVMH, the owner of Louis able leather skins or recycled plastic. that supplied leather or wool for lux- Manish Tewari@ManishTewari are struggling to be alive for 3 weeks - but Indian attention is pushing brands to produce Vuitton, Christian Dior and Dom Kering says it’s also pressuring its ury brands. Burberry’s burning of mil- A structural problem bedevils the fundamentals of media ignores Rahul Gandhi’s visit, Kashmir & ever-flashier events. Surging demand Perignon Champagne, in July bought a networks of suppliers and sub-suppliers lions of dollars worth of unsold mer- Indian economy because of lag effect of Kashmiris & busy with a lying machine. from China has lifted production to stake in Stella McCartney’s fashion to open up about where exactly their chandise prompted some unprecedented levels—meaning the label, known for working with sustain- raw materials come from, and imposing shareholders to demand change. manufacturers are using up more nat- able materials such as biodegradable higher standards on energy efficiency BLOOMBERG 8 WORLD MUMBAI | 25 AUGUST 2019 1 > Brazil sends army to Trump, EU clash over fight Amazon fires

LISANDRA PARAGUASSU & GABRIELA BACZYNSKA trade at G7 opening Brasilia/Brussels, 24 August AFP/PTI China hits out European leaders on Friday Biarritz, 24 August threatened to tear up a trade at ‘bullying’ deal with South America, S President Donald Trump and EU reflecting growing internation- leaders exchanged trade war US over tariffs al anger at Brazil as a record Uthreats on Saturday as they arrived number of fires in the Amazon in France for a G7 summit of wealthy AFP/PTI rainforest intensified an unfold- democracies overshadowed by trans- Beijing, 24 August ing environmental crisis. Atlantic tensions before it had even Amid a global chorus of con- begun. China on Saturday angrily hit cern and condemnation, “Trade wars will lead to recession, out at the latest US tariff hikes Brazil’s right-wing President while trade deals will boost the economy,” on its goods, saying a “bully- Jair Bolsonaro pledged in an EU Council President Donald Tusk said ing” Washington would even- address to the nation to in Biarritz, the chic Atlantic resort chosen tually “eat its own bitter fruit”. mobilise the army to help com- by French host President Emmanuel European leaders have al- bat the blazes, while his admin- Macron to stage the annual meeting. so warned US President Don- istration launched a diplomatic A tract of Amazon jungle is seen after a fire in Boca do Acre, Trump flew into Biarritz on Air Force ald Trump of the dangers of charm offensive to try to mend Amazonas state, Brazil, on Saturday REUTERS One hours after promising to impose pun- trade skirmishes with China bridges overseas. ishing tariffs on French wine imports if and Europe, which look set to Forest fires in the Brazilian fires to dryer-than-average wea- could sink its efforts to join the Macron doesn’t withdraw a tax on US tech dominate the G7 summit due Amazon, which accounts for ther and insisted on the need Organization for Economic Co- giants. US President Donald Trump and French President Emmanuel Macron attend a lunch to begin in France. more than half of the world’s for economic development of operation and Development And Tusk vowed that the EU “will ahead of the G7 summit in Biarritz on Saturday REUTERS Trump on Friday increa- largest rainforest, have surged the Amazon to better the lives of (OECD), a Paris-based club of respond in kind”. “The last thing we need sed existing and planned tar- in number by 83 per cent this its 20 million inhabitants. 37 developed nations whose is a confrontation with our best ally, the police said 17 people had been arrested as summit, Macron said his goal was “to con- iffs on a total of $550 billion in year, according to government Environmentalists have imprimatur is required by United States,” he said. “This is not our of Friday night amid clashes with pro- vince all our partners that trade tensions Chinese goods, in response to data, destroying vast swathes of warned that his controversial many institutional investors. initiative, this trade and tariff struggle, testers camped out near Hendaye. are bad for everyone”. new tit-for-tat levy hikes ann- a vital bulwark against global plans for more agriculture and Stung by the international but we have to be ready and we are ready.” Talks in the beach resort, known for The G7 meeting will also be the full ounced earlier that day by climate change. mining in the region will speed outcry, Brazil distributed a 12- It was a combative opening to the G7 sum- fierce rainstorms that blow in from the international debut of British Prime Beijing on $75 billion of US French President Emma- up deforestation. page circular, exclusively seen mit, traditionally a forum for frank yet Atlantic, will also be dominated by the Minister Boris Johnson, who will meet imports. nuel Macron called for G7 lead- “We have to give the popu- by Reuters, to foreign embass- cordial discussions among leaders from darkening clouds over the world economy. Trump for the first time as leader. A Chinese commerce mi- ers to discuss the environmen- lation the opportunity to devel- ies, outlining data and statistics the world’s leading economies — but Wall Street stocks slumped Friday after They are expected to discuss the UK’s nistry spokesman on Satur- tal crisis in Brazil this weekend op and my government is work- defending the government’s much less so since Trump’s election. Trump escalated his trade war with China impending exit from the European Union, day denounced Washington’s in Biarritz. Both France and ing for that, with zero tolerance reputation on the environment. European leaders are also using the that is seen as responsible for a global which the US president has enthusiasti- “unilateral and bullying trade Ireland threatened to oppose an for crime — and that is no dif- The Brazilian space agency summit to mount a tough push for action slowdown. cally backed. protectionism”. EU trade deal struck in June ferent for the environment,” INPE has registered 72,843 fires against fires in the Amazon rainforest, “We don’t need China and, frankly, But though Johnson needs Trump’s The tariff increase “seri- with a regional South American Bolsonaro said in his speech. this year, the highest number despite Brazilian right wing President Jair would be far... better off without them,” support for a free-trade deal, he is at odds ously undermines the multi- bloc following Brazil’s response. Polls show Brazilians over- since records began in 2013. Bolsonaro’s angry response to what he Trump tweeted on Friday, saying US com- with him on a range of issues including lateral trading system and the Images of fires raging in the whelmingly oppose his policy More than 9,500 have been sees as outside interference. panies were “hereby ordered to immedi- the Iran nuclear crisis, climate change normal international trade Amazon broadcast around the on the environment and as he spotted by satellites over the G7 leaders were greeted by a mass ately start looking for an alternative to and global trade. order, and the US will surely globe sparked protests outside spoke to the nation, residents past week. protest outside Biarritz, though 13,000 China”. His outburst came after China Trump is likely to find himself under eat its own bitter fruit.” “The Brazilian embassies from in large cities across Brazil Although fires are a regular police have been deployed to keep them imposed tariffs on US imports worth $75 pressure from the Europeans, particular- Chinese side strongly urges Mexico City and Lima to banged on pots and pans in a and natural occurrence during far from view. Organisers said 15,000 peo- billion in response to an earlier round of ly Macron, to ease off on his policy of the US side not to misjudge London and Paris. In the traditional Latin American the dry season at this time of ple rallied around 30 km (20 miles) south American measures. “maximum pressure” on Iran over its the situation, not to underes- Cypriot capital Nicosia, a sign form of protest. year, environmentalists blamed of the G7 gathering at the border town of Trump hit back immediately, raising nuclear programme. timate the determination of tied to the railings of Brazil’s US President Donald Trump the jump on farmers clearing Hendaye for a march over the Bidassoa tariffs still further. Since pulling out of the landmark 2015 the Chinese people, and diplomatic mission read: “The — whose skeptical views on cli- land for pasture. River toward the Spanish town of Irun. And as he left for Biarritz, Trump also nuclear agreement limiting Tehran’s immediately stop its mistak- Amazon belongs to Earth not mate change Bolsonaro shares Farmers may have had at Red, white and green Basque flags fired a salvo at France, threatening to slap nuclear programme, Trump has slapped en actions, otherwise all con- to the Brazilian president.” — called the Brazilian president least tacit encouragement from waved above a crowd that included anti- heavy tariffs on its wine in response to its crippling sanctions on the Iranian economy. sequences will be borne by Bolsonaro, who initially acc- to offer help, if needed, in deal- the firebrand right-wing presi- capitalists, environmental activists as well move to impose a sales tax on tech giants Macron wants him to put a “pause” on the US,” the spokesman said. used NGOs of setting the forest ing with the wildfires. dent, who took power in as a few dozen of France’s “yellow vest” like Facebook, Apple and Google. the policy, an aide said recently, which By the end of the year the on fire without providing any “I told him if the United January. anti-government protesters, according to “Those are great American companies, would enable talks to find a new diplo- feud will affect nearly all evidence, said in a televised States can help with the Bolsonaro has repeatedly AFP journalists at the scene. and frankly, I don’t want France going out matic solution to the crisis. imports and exports between address he had authorised the Amazon rainforest fires, we said he believes Brazil should “It’s important to show that people are and taxing our companies. Very unfair,” Iranian Foreign Minister Mohammad the two countries, with US use of troops to fight the fires stand ready to assist!” Trump open up the Amazon to busi- mobilised and do not accept the world he told reporters at the White House. Javad Zarif told AFP on Friday that companies — many of whom and stop illegal deforestation in said in a post on Twitter. ness interests, allowing mining, they’re offering us,” said Elise Dilet, 47, of “And if they do that, we’ll be taxing Macron’s “suggestions” to find a way out rely on China for inputs — the Amazon. Brazilian business leaders agricultural and logging com- the Basque anti-globalisation group, Bizi. their wine... like they’ve never seen of the current impasse were “moving in particularly worried by the But the former military offi- also warned the backlash over panies to exploit its natural The rally was peaceful so far, after before.” In a televised address ahead of the the right direction”. rapidly changing conflict. cer attributed the scale of the Brazil’s environmental record resources. REUTERS IN BRIEF Hong Kong stir met with tear gas, US, Japan North Korea launches more short-range missiles agreement on trade deal North Korea fired what appeared to be two short-range ballistic missiles China frees UK mission staffer into the sea off its east coast on Saturday, the South Korean military said, framework the latest in a series of launches in recent weeks amid stalled JESSIE PANG & DONNY KWOK since it was handed back from denuclearisation talks. Hong Kong, 24 August British to Chinese rule in 1997. BLOOMBERG Saturday’s launch was the seventh by North Korea since US President Hundreds took part in an “anti- 24 August Donald Trump and North Korean leader Kim Jong Un met at the inter- Hong Kong police fired volleys fake news” protest, with people Korean border in June. The launches have complicated attempts to restart of tear gas to break up anti-gov- waving the Hong Kong and The US and Japan agreed on a talks between US and North Korean negotiators over the future of ernment protests in a gritty ind- China flags and targeting gov- broad framework for a trade Pyongyang’s nuclear weapons and ballistic missile programmes. The two ustrial suburb on Saturday after ernment-funded broadcaster deal that will keep US tariffs leaders agreed in June to restart working-level negotiations but the United States has so far been activists threw petrol bombs RTHK. A station spokeswoman, on Japanese automobiles in unsuccessful in its attempts to get the talks going again. The process has been stalled since an unsuccessful and bricks, as China freed a Amen Ng, rejected claims of place for now, while remov- second summit between Trump and Kim in Hanoi in February. REUTERS British consulate worker whose RTHK peddling fake news. ing barriers to beef and pork detention had fuelled tensions. British consulate staffer exports to Japan, Japanese Four MTR subway stations Simon Cheng was detained for media reported. Trump barb at Amazon’s Audible Tunisia’s Karoui still were closed around Kwun 15 days for violating public Robert Lighthizer, the US Fed Chair Powell sued by publishers in presidential race Tong, a densely populated area A demonstrator stands during a protest on Saturday REUTERS security management regula- Trade Representative, and US President Donald Trump Amazon.com’s Audible was Tunisian media magnate Nabil of the Chinese-ruled city on the tions, police in Shenzhen, Japan Economy Minister Tos- sharply criticised Federal sued by publishers who claim a Karoui remains in the race for east of the Kowloon peninsula, reports of injuries. ers,” it said. The airport was for- across the border from Hong himitsu Motegi reached an Reserve Chairman Jerome mobile-app feature planned by next month’s presidential but thousands packed the “Give me democracy or give ced to close last week after pro- Kong, said on their Twitter-like agreement in Washington on Powell on Friday and said he the audio-book company will election despite his arrest on streets anyway, most carrying me death,” was spray-painted testers thronged the main term- Weibo account. Friday, the Nikkei and Kyodo wouldn’t try to stop the chief US violate copyrights by automati- Friday, the electoral commission umbrellas against the sun. on a wall, an illustration how inal for several days, grounding Police said Cheng was relea- News reported, without citing central banker if he offered to cally converting narrated works said on Saturday. Tunisian police Police used tear gas after the demands of the protesters around 1,000 flights and occa- sed as scheduled on Saturday sources. The US has a 2.5 per resign. Trump, departing the into unauthorised text. arrested Karoui after a court some protesters threw Molotov have expanded beyond the sionally clashing with police. and that his legal rights and cent import tax on Japanese White House to travel to the G7 Audible’s licences for the audio- ordered his detention in a case cocktails and bricks and others withdrawal of a bill that would The wider calls for democ- interests had been observed. cars and a 25 per cent levy on summit in France, told books don’t include text involving charges of money tore up “smart” lamp posts eq- have allowed extraditions to racy have plunged the city into They also said Cheng had con- trucks from the nation. Japan reporters, “I’m not happy with versions, and the machine- laundering and tax evasion. His uipped with surveillance cam- China. The government said in an unprecedented crisis posing fessed to accusations against will lower tariffs on US beef Jay Powell.” His comments generated transcriptions may party said his detention was a eras. Others had set up roadbl- a statement the protesters a direct challenge for Comm- him, a commonly used comm- and pork to the same levels as continued a war of words contain errors that will harm the politically motivated attempt to ocks with bamboo scaffolding. “posed a serious threat to the unist Party leaders in Beijing. ent by Chinese police, although those proposed for the Trans- against Powell that, along with quality of the works, publishers exclude him from the election It was the first use of tear gas safety of everyone” at the scene. Demonstrators say they are Cheng was not given a chance Pacific Partnership, they said. retaliatory tariffs imposed on US including CBS’s Simon & Schus- race. A government official in 10 days after a series of most- “After repeated warnings to fighting the erosion of the “one to defend himself in court. The report raises the like- goods by China, helped trigger a ter, Penguin Random House and rejected that accusation and ly peaceful demonstrations in the protesters..., police officers country, two systems” arrange- Cheng had now returned to lihood that US President Don- sharp drop on Friday in the US Scholastic said in the complaint said that it was a judicial the former British colony. deployed tear gas and mini- ment that enshrines a high deg- Hong Kong, his family said on ald Trump and Japan Prime stock market. REUTERS filed on Friday. BLOOMBERG matter alone. REUTERS There were no immediate mum force to disperse protest- ree of autonomy for Hong Kong his Facebook page. REUTERS Minister Shinzo Abe will make a trade announcement during the G7 summit. Japan is seeking to stay in Trump’s good graces to avoid costly tar- iffs and retain positive rela- Fed says it’s trade, not rates, that’s undermining the US economy tions with an ally that ensures its security against China and CHRISTOPHER CONDON & CRAIG TORRES Fed for what’s slowly curdling the September, markets plunged after certainty, you have to take action. It North Korea. Japan is also 24 August world’s largest economy, illustrated Trump tweeted about an hour later, is a message of open-ended policy counting on US support as its by the weakening of business inve- vowing retaliation against China in recalibration as needed.’” diplomatic spat with South President Donald Trump has a stment and manufacturing output. the latest escalation in the trade For companies, uncertainty has Korea intensifies. pithy message to Americans wor- Trump has elevated his criticism war. Yields on 10-year US treasuries also crept into uncharted territory. A draft agreement could ried about the economy: It’s the of the central bank to a shrill level in fell to near 1.5 per cent. Kaplan said the turning point came be signed by the end of Sept- Fed, Fed, Fed. recent weeks. In a blunt tweet on Powell’s remark about “no recent in May when Trump, despite having ember, the Nikkei reported. The Federal Reserve has a snap- Friday he wondered who was a big- precedents” is an expression of struck a fresh trade deal with Cana- Trump, who threatened to py retort: It’s trade, trade, trade. ger “enemy”, Fed Chair Jerome what economists call Knightian da and Mexico, threatened to slap raise tariffs on the approxi- Central bank officials are loath to Powell or Chinese President Xi uncertainty. It’s a concept named new tariffs on Mexico unless it stem- mately $50 billion worth of engage the president directly. But as Jinping. Earlier this month Trump for American economist Frank med the flow of migrants to the US. cars and auto parts Japan they gathered this week in Wyom- called the Fed “clueless”, all part of Knight who distinguished unknow- That shook companies for two exports to the US annually, ing, policy makers explained again his campaign to pressure officials able outcomes from risks that are reasons. It meant even after a dis- had hinted that there might and again how trade disputes are into lowering interest rates more statistically quantifiable. pute settlement Trump might still be a deal in August. poisoning the global economy and aggressively, to stimulate the US For example, Fed officials can throw any deal out the window. A deal with Japan would making their job more difficult. economy. Economic growth this come up with estimates about how Second, Trump might pick a fight give Trump a victory in his “The fulcrum or centre of gravity year is still projected to hit about 2 tariffs will affect import and export for any non-economic reason and trade wars. Trump is escalat- of the US economic policy today is per cent, but that’s not fast enough volumes and tie that into an outlook use tariffs as a weapon. More broad- ing his trade war with China, not monetary policy, it is trade for Trump, and he’s blamed the Fed. for growth, said Michael Gapen, the ly, it hardened the sense that White announcing that an existing uncertainty,” Dallas Fed President “Our economy is very strong, President Donald Trump’s extended and unpredictable trade wars that are chief US economist at Barclays in House trade policy was no longer 25 per cent tariffs on some Robert Kaplan said on Thursday as despite the horrendous lack of making it difficult for the Fed to keep the economy on an even keel REUTERS New York. It’s harder, however, to linked to a predictable strategy. $250 billion in imports from the Kansas City Fed’s annual sym- vision by Jay Powell and the Fed,” know how tariffs impact business “Since that point a lot of busi- China would rise to 30 per posium in Jackson Hole kicked off. he tweeted on August 19. leagues in his prepared remarks to spending, business investment and confidence, investment plans and nesses I speak to have become more cent come October 1. He also He was followed by Patrick That sort of name-calling is sure- central bankers at Jackson Hole on public confidence, it cannot provide hiring, he said. cautious on capex and on expansion told US companies to with- Harker, president of the Philadel- ly annoying for Powell and his col- Friday. He made clear it’s not the a settled rule book for international “Powell understands more than plans,” Kaplan said in a CNBC inter- draw from China. The latest phia Fed, who recounted what busi- leagues. More practically, however, Fed’s job to set trade policy. But trade.” most Fed presidents that you are view, referring to capital expendi- actions are a sign of Trump’s nesses in his district are telling him. it’s Trump’s extended and unpre- there was subtle pushback as well. Indeed, Trump’s Friday tweets going to have to think beyond the tures. “Businesses now have inter- growing frustration with the “What we hear repeatedly from dictable trade wars that are making There are “no recent precedents were a good illustration. While model right now,” said Julia nalised that trade uncertainty is lack of progress in his trade companies is the trade uncertainty. it difficult for the Fed to keep the to guide any policy response to the Powell’s speech, released at 10 am Coronado, the head of MacroPolicy going to be with us for some extend- assault on China and a slow- It is not the cost of capital,” he said. economy on an even keel. current situation”, he said. “While New York time, might have encour- Perspectives in New York. “Powell’s ed period of time, even if some of ing economy, according to In other words, don’t be fooled Powell tip-toed into the trade monetary policy is a powerful tool aged investors by hinting strongly answer is, ‘Even if you don’t know these bilateral trade issues get analysts and people close to by the president into blaming the issue more carefully than his col- that works to support consumer that an interest-rate cut is coming in the impact of developments with resolved.” BLOOMBERG the administration. MUMBAI | 25 AUGUST 2019 JAITLEY: LIFE & TIMES 9 . <

z1 Jaitley with former prime minister Atal Bihari Vajpayee in whose Cabinet he served z2 Bowling for the Supreme Court Bar Association team in 2005 z3 As a student leader during his Delhi University days z4 Celebrating India’s victory over Pakistan in Karachi, in 2004, with Congress leader Priyanka Gandhi 1 2 3 SOURCE: www.arunjaitley.com, 4 PTI

Arun Jaitley: 1952-2019 THE PEOPLE'S FINANCE MINISTER The mark he left on the economy ARUP ROYCHOUDHURY New Delhi, 24 August

Arun Jaitley will be remembered as the finance minister during two of the biggest seismic events in India’s economic histo- ry — demonetisation and the goods and services tax (GST). While helming affairs at North Block, he put in place a number of economic laws and measures. These include the Insolvency and Bankruptcy Code, the Black Money Act, amendments to the Benami Act, the Fugitive Economic Offenders Act, banking reforms through the ‘Indradhanush’ programme, mergers of a number of state-owned banks, and a record number of divestment proceeds. For policy watchers, however, his biggest achievement was perhaps fiscal recti- tude, something on which he had the unequivocal backing of Prime Minister Narendra Modi. For his first Budget in July 2014, Jaitley Former finance minister Arun Jaitley on inherited a fiscal deficit target of 4.1 per the trading floor before ringing the closing cent of GDP. “The target is indeed daunt- bell of the New York Stock Exchange on ing. Difficult, as it may appear, I have June 17, 2015 PHOTO: PTI decided to accept this as a challenge. One ADITI PHADNIS staff. One of the highest tax payers in Delhi, Jaitley University Students’ Union polls. But then, the fails only when one stops trying,” he had the peacemaker and negotiator, Jaitley New Delhi, 24 August also got a block of flats built for the secretarial staff of Emergency happened. said. From 4.1 per cent, the fiscal deficit played a key role in building a consensus to his legal practice. The daughter of one of them is now The good boy from the middle-class family was came down to 3.4 per cent by 2018-19. get the Constitution Amendment Bill on he home office of lawyer, former Union min- a dentist, practicing in England; her education was pitch-forked into underground politics. In 1975, he There were two slippages from the bud- the goods and services tax (GST) passed in ister and Bharatiya Janata Party (BJP) leader funded by Jaitley. was arrested and spent 19 months in prison. While geted targets, in 2017-18 and 2018-19, the Parliament. Then, the GST laws were Arun Jaitley — who died on Saturday — was Bureaucrats also found in him a reasonable boss, incarcerated, his second-year law results came out — former due to introduction of the GST. passed in the Assemblies to enable intro- T the true testament to his personality. whose knowledge of business and law was astounding. Jaitley had got a first class. Arvind Subramanian, who was chief eco- ducing the new indirect tax on July 1, 2017. Floor-to-ceiling bookshelves crammed with Jaitley enjoyed two things above all — a good meal Too young to contest the 1977 elections, he with- nomic advisor under Jaitley, has described In all the 33 GST Council meetings that he leather-bound compilations of court cases. In the midst and a good session of gossip. drew from politics for a while to concentrate on his him as the best boss he has had. Jaitley chaired, never once did decisions have to of this intellectual splendour, two framed black and Dal from Minar Restaurant at Connaught Place was legal career. When Atal Bihari Vajpayee became prime backed his bureaucrats to the hilt when- be taken through voting. All were through white pictures — of a young, intense-looking Jaitley, among his favourite dishes. Jaitley once told this minister (PM) in 1998, Jaitley was made a minister. ever they came under attack. Even when consensus. “The political noise outside is wearing thick glasses, standing beside former prime reporter how when he travelled to New York, he would He made no bones about what portfolio he liked and he had to discipline some of them in pri- inconsistent with the harmony inside the minister Morarji Desai, along with several other young have Indian dishes from a specific restaurant in what he did not — the law ministry was his least vate, he never criticised them publicly. An Council,” Jaitley would say often. men. These are from his days as a student leader. Manhattan delivered to his hotel. favourite. “You are required to give legal opinion on a example is when Jaitley made it known to But did his inclusive approach create There were no pictures of gods and goddesses in His love for good gossip earned him many friends couple of cases,” he once said. “But 90 per cent of your people who met him that he was unhappy problems? Critics of the GST say that its this office. Instead, there were framed replicas of legal among journalists. But, as scribes are themselves noto- time is spent meeting brief-less lawyers who want to be with Subhash Garg, who was then finance complex structure, incorporating five rates certificates and mementos from various cricket asso- riously gossipy, this trait also earned him enemies. appointed state counsel.” secretary, for tweeting against a comment when the ideal situation would have been ciations, testifying to the other love of his life. Jaitley’s family moved from Lahore to Amritsar in He was also information and broadcasting minister made by then Reserve Bank of India (RBI) two or three, was a result of Jaitley trying to How did a man who clearly admired a political 1946; his mother was expecting her first child, his eld- briefly; he described the experience in a sentence: “It’s deputy governor Viral Acharya. In public, please everyone. One of his bigger achieve- leader like Desai and was so fond of cricket that he er sister. By the time of Partition, his family was settled a ministry for Doordarshan that nobody watches any- Jaitley backed Garg. ments was to get the Insolvency and named his son Rohan reconcile himself to the com- in India, but with meagre resources. way.” As commerce minister he did not have enough In informal conversations, current and Bankruptcy Code (IBC) enacted, as a moun- pany of the rabble-rousing mob that brought down Like elsewhere in India, Brahmins, as Jaitley’s family time to remove the Congress stamp. past bureaucrats, some of whom are still in tain of stressed assets hobbled the banking the Babri Masjid in 1992? was, had little land — but placed a premium on education. It was the Ministry of Disinvestment that had real- very powerful positions, have spoken high- sector. Timely capital infusion in public Others, too, were confused. All of Jaitley’s seven uncles were well educated — ly occupied him. He vowed to make a real change if the ly of him as a minister who trusted his sector banks and the move for merger of In a rediff.com chat session in the early 1990s, some- and the extended family contributed to each other’s National Democratic Alliance ever came to power bureaucrats’ judgement and experience. weak banks with strong banks ensured one asked him: “Mr Jaitley, how can a so-called edu- education. All the brothers pooled in their resources to again, he said in 2004. They would always count on his deep some stability in the financial sector. cated man like you be a member of an obscurantist, fas- send one of them to England to study psychiatry. Most knowledge of the law, the Constitution, Journalists covering the finance min- cist organisation like the Bharatiya Janata Party (BJP)?” of the others practiced law. Modi’s rock and parliamentary processes. istry will remember his informal interac- He replied: “I reject your understanding of the BJP. Jaitley was also a rock for Narendra Modi when the To some critics, it seemed that his tions in North Block. These were differ- Nehruvian thought, which regarded everything that From Emergency to Parliament future PM decided to nudge BJP patriarch L K Advani reliance on officials may have been detri- ent from his “durbars” in Parliament and was Indian, ethnic, traditional and cultural, as obscu- Jaitley went to St Xavier’s, and chose science in school, out of the way and make a bid for the top job. He also mental at times. It is still unclear what elsewhere, in that these were more on pol- rantist and fundamentalist damaged the Indian ethos. believing he wanted to be an engineer. Later, he joined drew up the blueprint to protect Modi from Delhi’s arguments bureaucrats had placed in front icy than political. We are criticised because it is said we are pro-Hindu. the bachelor of commerce course at Shri Ram College chattering classes. Modi also sought his advice on var- of Jaitley before the finance ministry sent There were of course gossip and anec- The threat to global secularism doesn’t come from of Commerce of Delhi University. ious matters — though not in all, such as the first a communication to the RBI last October, dotes, some small tidbits of information either Indian nationalism or Hinduism, it comes from It was during his college days that he learned to read Budget of his government presented. saying that it wanted to start consultations which could be run as stories. But most elsewhere — you know where. I think you and I need a balance sheet — and plunged into politics. He had In the electoral battle, Jaitley had missed success. with the central bank under Section 7 of importantly, he used these interactions to re-discuss political definitions.” already become an activist of the Akhil Bharatiya But, in the Modi government, he was the mentor — he the RBI Act on a number of issues. to talk at length about the government’s Vidyarthi Parishad (ABVP), the youth wing of the groomed half a dozen of those who became ministers. It was a move that led to the biggest thinking and reasoning behind any eco- Dal and spices Bharatiya Jana Sangh. Some remembered, others did not — Jaitley seemed to breakdown in the relations between the nomic decision or policy, an invaluable With his death, Jaitley has taken with him a slice of the He had already contested the college union elec- care little. He concentrated on getting BJP re-elected, government and the RBI in recent times. reference point for journalists covering hearts of everyone who knew him; especially, his personal tions and the ABVP wanted him to stand for the Delhi a target he achieved in his lifetime. But that was perhaps an aberration as ever the government.

FOND MEMORIES

PRIME MINISTER FINANCE MINISTER FORMER PRIME MINISTER CHAIRMAN, BHARTI ENTERPRISES CHAIRMAN & MD, HUL NARENDRA MODI NIRMALA SITHARAMAN MANMOHAN SINGH SUNIL MITTAL SANJIV MEHTA

“JAITLEYWAS FULLOF “AMENTOR TO MANYOF “HE WAS ALEADER WITH “HE HAD AVERY “HE WAS ATALL LIFE, BLESSED WITH WIT, A US, AGUIDE AND A DEEP INTELLECT AND PERSONALTOUCH IN HIS PARLIAMENTARIAN, GREAT SENSE OF HUMOUR MORALSUPPORT AND KNOWLEDGE, AND A DEALINGS, SOMETHING ASTUTE LAWYER, AND CHARISMA; I HAVE STRENGTH. HAVE LEARNT VOICE OF REASON. HE THAT ATTRACTED PEOPLE GREAT LEADER, LOST AVALUED FRIEND... SO MUCH FROM HIM. A WILLBE DEARLYMISSED. EVEN FROM THE OTHER TRUE GENTLEMAN [HE HAD] IMPECCABLE FINE LARGE-HEARTED MYPRAYERS WITH HIS SIDE OF THE POLITICAL AND ABOVE ALL KNOWLEDGE ABOUT PERSON ALWAYS READYTO FAMILY, FRIENDS SPECTRUM TO SEEK WONDERFUL CONSTITUTION” HELP ANYONE/EVERYONE” AND ADMIRERS” HIS COUNSEL” HUMAN BEING” 10 DEMOCRACY AT WORK MUMBAI | 25 AUGUST 2019 >

What to watch out for in the BJP DID THEY REALLY SAY THAT? CHECKLIST Elections to the biggest political party in the world are nigh: and they will be supervised IMPORTANT FOREIGN VISITS IN 2019 by the BJP national election officer Radha Mohan Singh, former agriculture minister. The poll process will begin with election of the booth level units followed by the block n September: Prime Minister Benjamin relations on fast track but the two countries are level presidents to be completed by September 30. Following this, the district level pres- Netanyahu of Israel will visit India on 9 cooperating in third countries as well: building idents will be elected and the process will be completed by 30 November. After the September, just eight days before Israel goes a cancer hospital in Kenya together, for district level presidents, election process will begin for the state unit presidents. Elections to repeat polls after he failed to form a example. Japan is working on several CHATTERBOX for the BJP national president will be held in the end. The most contentious part of the government following the April 9 elections. infrastructure projects in north east India. election will be the election of a state president. What to watch out for? States where Netanyahu's meeting with Modi could be just n November: Will he keep his promise? there is actually an election because that will indicate the strength of various factions in another photo-op to project his acceptance President Donald Trump accepted an invitation the party. worldwide and prop up his campaign just from Prime Minister Modi to visit India when before the polls. But from India’s point of the two leaders met in June. The last time India From Didi to BJP view it is corralling an important ally and invited him (for the Republic Day in 2018) Trump Sovan Chatterjee’s induction in the BJP has the party’s West Bengal unit agog. Chatterjee reaffirming relations with its biggest defence turned it down because of the State of the has been a two-time Mayor of the Kolkata Municipal Corporation and has held important “It's a matter of faith of crores of people. The supplier. Union address which clashed with the Indian Cabinet portfolios in the Mamata Banerjee government in Bengal. He was also the place is associated with Ravidas, it has got his n October: In October, 2018, Prime Minister event. Now, a possible date is November or vibrations. The matter has become a subject of district president of the TMC for South 24 Parganas district and by virtue of being one petty politics. All should work for construction of Narendra Modi visited Japan for the India- early January. His visit is especially important of Banerjee’s closest aides and one of the founding members of the TMC, he is also the temple. Around 12-15 crore people want the Japan Annual Summit. This year, it is India’s because of the discord on trade and the believed to have been one of the key strategists for Banerjee’s victory in the 2011 Assembly Centre to allocate this four-five acres of land for turn to host the summit and Prime Minister possibility of US sanctions following India's elections. The BJP did not win a single seat from the South 24 Parganas district in the the temple” Shinzo Abe is expected to come to India negotiation for purchase of the S 400 missile recently concluded Lok Sabha polls. The district has five Lok Sabha seats and 31 Assembly Delhi Chief Minister Arvind Kejriwal in the Assembly after (possibly Varanasi again, or some other city) to defence shield from Russia which has the seats. So Chatterjee is believed to hold the key to an important region. the demolition of Ravidas Temple in Delhi, August 22 attend the summit. Not only are India-Japan potential of inviting sanctions on India.

a thing, because everyone thought that having In the neighbourhood in south Asia, OPINION vanquished the LTTE, people would live in when the political leadership has been peace, irrespective of their religion. With this, weak, the Army has felt tempted to SHAKTIKANTA DAS the country suddenly found itself in a different intervene and to set things right. We’re direction, like the 9/11 incident in the US. This seeing evidence of weak political has served as a good warning to us to be vigi- leadership in Sri Lanka, most visible in lant and to do whatever is possible to control the handling of events leading up to Harmonise norms and eradicate this problem in a proper, sys- Easter Sunday. So, are you seeing a danger tematic way. of any kind of an army intervention? As a result, the government announced a Sri Lanka Army has been a very disciplined between banks National Plan on Preventing and Countering army throughout its history. So I don’t foresee Violent Extremism in Sri Lanka. So we are any such move by the Army because although working on that. We are going to study other we are a victorious Army, we are, at the same and NBFCs concepts and experiences of other countries time, highly disciplined and professional. We in this area and adopt best practices to control expect that the political leaders will respect and eradicate violent extremism without cre- democracy. Except for one or two occasions a oming to the NBFC sector, we all know that this sector ating any problems for the Muslim commu- long time back, the Army has never intervened complements the banking sector and aspires to act as nity in Sri Lanka. in politics. C the bridge to provide last mile connectivity. Further, There was a time, soon niche NBFCs fulfil the unmet and exclusive credit needs of The Muslim community is after the war, when the army infrastructure, factoring, leasing and other such activities. saying earlier they were had the highest support from Non-traditional and digital players are now entering this space sandwiched between the the general public. But even to deliver financial services by way of innovative methods Tamil extremists and the Sri then, our military leaders did involving digital platform. There is a web of inter-linkages of Lankan Army. Now, it is not try to resort to any adven- the NBFC sector with the banking sector, capital market and feeling pressure from those turism. So I don’t foresee any- other financial sector entities. The Reserve Bank keeps a close forces which want Sri Lanka DHARSHANA thing like this. watch on these inter-linkages to ensure financial stability. to be an assertive Buddhist HETTIARRACHCHI majority state; and on the The one thing that is With a view to strengthen the sector, maintain stability and Major General, other side, forces of worrying about Easter avoid regulatory arbitrage, the Reserve Bank and the govern- ILLUSTRATION BY BINAY SINHA Sri Lanka Army ment have been proactively taking necessary regulatory and Wahhabi Islam… Sunday is that the people supervisory steps. Muslims have been living in Sri Lanka for a who carried out this attack were not poor, Our objective is to harmonise the liquidity norms between long time without any problems. But this uneducated people who were ready to banks and NBFCs, taking into account their unique business Major General Dharshana Hettiarrachchi heads the newly formed team for Counter- Wahhabism and new concepts have been become cannon fodder because they had models. We are also looking at governance and risk manage- Radicalisation, set up by the government of Sri Lanka. In an interview, he tells Aditi Phadnis brought into Sri Lanka in the last three or nothing to lose. They were people who ment structures in NBFCs. Recently in May 2019, NBFCs with about the new challenges Sri Lanka faces after the April attacks by Islamic radicals and how the four years. Among Muslims there are some were educated, wealthy and respected in a size of more than ₹5,000 crores have been advised to appoint country is proposing to meet them. Edited Excerpts: groups which are extremist groups. So we are the community…. a functionally independent Chief Risk Officer (CRO) with clear- working with the moderate traditional groups If you take the LTTE, most of them were poor ly specified role and responsibilities. This is expected to bring that are against this extremism and taking and uneducated. Many of their cadres were in professional risk management to the working of large their help to educate people that we cannot also the lowest castes in the Tamil social order. NBFCs. The move to bring Housing Finance Companies have another war in Sri Lanka. Our develop- Those who conspired to mount the Easter (HFCs) under the regulatory ambit of the Reserve Bank is sig- ‘Sri Lanka cannot ment has already suffered because of the Sunday attacks were educated people from nificant, given their asset-liability profiles. Including HFCs, events in the North and East. Before the wealthy families who have studied in both Sri the size of the NBFC sector constitutes about 25 per cent of Easter Sunday attacks, Sri Lanka was the Lanka and overseas. combined balance sheet of scheduled commercial banks. The number one destination for tourists. Now we I had the opportunity to speak to one of Reserve Bank will take necessary measures to deal with these afford another war’ are working on a plan so that Sri Lanka is a them who had a serious involvement in the challenges. peaceful country for all Sri Lankan, irrespec- conspiracy. This young man — around 22 or tive of religion or race. 23 — had studied in one of the leading schools Headwinds from financial markets The Sri Lankan Army (SLA) is in the The whole country got together — the people This extremism is the belief of only a small in Sri Lanka, is from a very wealthy family Apart from banks and non-banks, headwinds to financial sta- unique and enviable global position of in the South as well as even the Tamils in the group of Muslims. 90 per cent of Sri Lankan and was sent to Australia for further educa- bility can also originate from financial markets. The increasing possibly being the only conventional north and east. The government gave the Muslims are moderate and want to get on with tion. There, he used to go to a mosque where frequency and severity of currency and debt crises globally Army to militarily vanquish one of the armed forces the liberty to go ahead with their life and business. he met a middle-aged Muslim — not a Moulvi, and their ability to cause output loss calls for careful regulation most feared guerilla groups in the world. their plans without interfering. The The blasts occurred on April 21. Within one but a strong committed Muslim. He got and surveillance of financial markets. Globalization of finance, But you’ve had many setbacks as well. Secretary (defence) coordinated all efforts: month, our armed forces, police and other friendly with this man and told him about his by amplifying the risk of contagion, and thereby constraining What is your learning from the military Whether it was acquiring weapons or other agencies had the situation under control. 90 family, his background, etc. This middle aged the policy space for effective regulation, has added to the dif- campaign and what followed? logistics support. The President stood firm per cent of the people who planned the inci- man told him: ‘God has given you everything ficulty of this task. As a regulator of various market segments The fight with the Liberation Tigers of Tamil against the political pressures especially dents were apprehended. in your life. Your parents are very wealthy, such as money markets, G-sec, forex and interest rate deriva- Eelam (LTTE) went on for almost three from western countries. you’ve had the opportunity to study in the tives, the Reserve Bank has followed calibrated, sequenced decades. By 2008-09, LTTE was almost like a After 2009 and upto April 21, 2019 — Easter What about the other side of it: the best institutions, you live a luxurious life. and careful approach to develop and integrate these markets. professional Army. They had a naval wing, an Sunday — we did not have a single terrorist pressure from the Sinhala Buddhist Back in history, Muslims controlled the whole The broad objective has been to keep pace with the require- air wing and their land force. They also had incident in Sri Lanka. community that Sri Lanka must become world. But gradually, Christians, Hindus and ments of fast-growing Indian economy, while being vigilant suicide cadres. In 1996, the US State more Buddhist and less ‘secular’? Buddhist supplanted the Muslims. Why not of potential risks to financial stability. This is done through Department declared the LTTE the most ruth- With all your experience and Actually, like the extremist elements in the do something that will bring Islamic glory freeing up market forces by moving away from prescriptive to less terrorist organisation in the world. understanding of how terrorist networks Muslim groups, there are also extremists back in the world? Why not be grateful to God principle-based regulation, whose core features are simplifi- Successive governments used various work, how did Easter Sunday happen? among Buddhist groups. But it is a very small and do something for your religion?’ cation of processes, encouraging product innovation, remov- means to eradicate this problem from Sri This organisation, National Thowheeth percentage. 99 per cent of Sri Lankans are for Thereafter, this young man was shown certain ing regulatory differentiation across participant categories Lankan soil but the previous regime (led by Jama’ath, has been operating in Sri Lanka for a peaceful living and co-existence with other videos, showing Muslim youth fighting. Now, and ensuring protection for retail market participants. President Mahinda Rajapaksa) made eradi- considerable period. Our intelligence agencies communities. this is a young man. After seeing the videos Adoption of global best practices to improve market integri- cation of terrorism a promise in their election had most of the information related to their We are working on that also: To make he got really motivated. That’s one way of ty is another important aspect of regulation. In the last couple manifesto. So it (the military campaign) was activities. The only thing is, on the day of the them understand and to implement strict indoctrination. of years, the Legal Entity Identifier (LEI) system has been a very coordinated effort. The President gave attack, there had been some information and law and order with exemplary punishment We say social media plays a big role in rad- implemented in a phased manner in all financial markets, the political leadership and luckily, the intelligence as well. But due to some lapses at for people who make hate speeches and icalisation. But that’s not the only way. including derivative markets regulated by the Reserve Bank, President’s own brother was the Secretary various levels, the information did not dissem- those who try to provoke other communities Glorifying killing through psychological as well as for bank loans. We believe transparency of financial (Defence). All the three arms of the defence inate to the correct people at the correct time. and religions. indoctrination is another way. And we are markets will greatly improve once the LEI system is used wide- forces were led by officers who were experi- The unfortunate incident happened as a result. 74 per cent of Sri Lankans are Buddhist. pledged to counter all forms and methods of ly. The recent regulations to control market abuse, upgrade enced and had been in the field throughout. But Sri Lankan people never expected such And Lord Buddha taught us non-violence. radicalisation. the benchmark setting process are all consistent with global standards. A key feature of regulation of derivative markets has been the differential treatment of professional and non-expert clients. Moreover, differential access to derivative markets is being gradually removed. Anyone - resident or non-resident - can now access these markets for hedging on similar terms. Packing a punch In fact, alignment of incentives for non-residents to gradually move to the domestic market is an important regulatory aim. As you would be aware, the Task Force on Offshore Rupee A 27-year-old in UP is teaching young women Japanese martial art and self-defence techniques to ward off Markets with Mrs. Usha Thorat, former Deputy Governor as eve teasers and molesters, writes Meghna Chadha chairperson, has made important recommendations that are likely to improve participation of non-residents in the onshore market. Our aim is to make the onshore market more accessi- t’s around 9:00 pm in Delhi and you’re Jyoti Mala, a 25-year-old from Lucknow who ble and attract higher transaction volumes. waiting for your cab on the side of the just completed her BSc Nursing can’t help but I road. You share the cab details with fami- smile as she remembers the one time she and External headwinds and domestic financial stability ly/friends. You notice two men on a bike com- her friends taught a lesson to a few boys from With increased trade and financial linkages with rest of the ing towards you. Staring at your phone, you her college who were following and comment- world, India has become more susceptible to the vagaries of secretly hope they wouldn’t notice you and ing on them at every chance they got. “We were heightened global economic uncertainties. While trade chan- move on. But, they don’t. They slow down; taught a few easy but effective moves by nels take some time to show a tangible impact of global shocks, look at you, pass comments and eve-tease, Abhishek and let’s just say after we taught those it is the financial and confidence channels that quickly transmit while you helplessly wait for it to pass because boys a lesson; we never saw them around again.” the global shocks as was evident in the case of India during the you don’t want to provoke them. Abhishek Yadav holds a Limca World taper tantrum period in mid-2013. In fact with negative and This is a scenario most women all over the record for training 5,700 girls in self-defence low interest rates in major economies, net private capital flows world, especially in India, face on a techniques in Kunda, to EMEs in the form of direct and portfolio investments have daily basis -- the problem of eve-teas- Pratapgarh, and Uttar Pradesh. nearly doubled in the post-crisis period. However, with high ing and molestation. But 23-year-old This record was previously held monetary policy uncertainties in advanced economies, these Neha Singh does not have to tolerate by Delhi Police and the Delhi flows have proved to be fluid and therefore posed considerable this harassment anymore. “Passing government when they trained risk to EMEs. Just a year back, EMEs like India faced financial lewd comments and teasing has over 5,000 girls in self-defence. market turbulence due to a faster-than-expected tightening in become very common these days and The 27-year-old is also the monetary policies in advanced economies. Many EMEs includ- there are no strict laws regarding youngest achiever of Yash Bharti ing India witnessed portfolio capital outflows, exerting down- them. Police also can’t take any Award, the highest award given by ward pressure on domestic currencies. immediate action in these cases. So, THE OTHER the UP government for contribu- Abhishek Yadav’s foundation Abhiself Protection Trust trains these girls under the "Meri In recent years, India’s external sector has benefited from for self-defence and helping those INDIA tion in social work. His vision is Raksha, Mere Haathon Mein" programme a sustainable level of current account deficit, largely financed around me I learnt aikido (a modern to make women self-empowered by robust foreign direct investment inflows and flexible Japanese martial art) from Abhishek by teaching them aikido and other selves,” Yadav recalls. any female to be left out to deter potential exchange rate policy. Improvement in other vulnerability Yadav in 2014-15. It was both empow- martial art techniques for self- Yadav’s foundation Abhiself Protection attacks just because of their financial posi- indicators during 2018-19 such as fall in external debt to GDP ering and liberating for me.” defence and road fights by setting up camps Trust trains these girls under the "Meri tion,” Yadav added. ratio (from 20.1 per cent at end-March 2018 to 19.7 per cent at Singh, who has a full-time government job in various cities. These workshops last a week Raksha, Mere Haathon Mein" programme. When asked about his future plans, he said end-March 2019) and debt service ratio (from 7.5 per cent at now, takes time off every year to volunteer at to 15 days. The foundation coaches girls free of cost and he wants to set-up an academy in New Delhi end-March 2018 to 6.4 per cent at end-March 2019) also augur these training camps to teach young school- “It started in 2007, as a camp to teach is all set to create the Guinness World Record and wants to keep on empowering more women well for mitigating the spill over. girls. “Learning how to defend myself and female police officers in Uttar Pradesh to take by training 21,000 women from schools, col- both in the national capital and throughout the being able to teach others has made me more down guys without using weapons with basic leges and police in Mumbai by December. country. “What started as a means to get back Edited excerpts from a speech by RBI Governor, Shaktikanta Das on confident and my belief that the stereotype and minimal power techniques. After the 2012 “In a country, where crimes against women and get even with fellow schoolmates is helping Emerging Challenges to Financial Stability, August 19, at FIBAC 2019, the that women are weaker than men will be bro- Delhi gang-rape case, I felt there was a need are increasing rapidly, women must learn to me bring about a change in the country and annual global banking conference organised by IBA and FICCI, Mumbai ken sooner than later,” she adds. to teach young girls how to protect them- fight back and not be victimised. I don’t want helping women raise voice against injustice.” OPINION 11 > Volume XIII Number 23 MUMBAI | 25 AUGUST 2019

staff. There are no controls on the number of Security, political and personal, is the World Tourism Organization (UNWTO) people allowed in, so that burgeoning unruly other dimension of the problem. Political shows. It puts India second only to China as Making India incredible crowds in the manicured lawns vitiate the turmoil keeps tourists away from such des- the world’s fastest-growing outbound quality of the visit. The entire experience is tinations as Jammu & Kashmir and the tourism market. Some 50 million Indians Indian tourism needs infrastructure and security upgrades a marked contrast to a visit to the Great Wall Northeast. It is possible for women and for- are expected to travel abroad in 2020. of China, which received 10 million visitors eigners to travel in Europe, the US, and The UNWTO rightly attributes this rime Minister Narendra Modi has ever, remains the challenge. Bar the tradi- last year against the Taj Mahal’s 8 million. Southeast Asia, using public transport with- outbound surge to the greater affluence of exhorted his compatriots to visit at tional tourist states of Rajasthan and Kerala, Though road and train links to the Taj have out fear of being molested or robbed. Few the middle class. The fact that the upward- least 15 Indian destinations by and some pockets elsewhere, tourism in improved as has hotel accommodation in locations in India can make similar claims. ly mobile do not feel it incumbent upon P 2022. Prima facie, this is a good India can be a frustrating and unsatisfacto- Agra, this cannot be said of most other places Indeed, the former haven of Goa has seen a themselves to explore their own country is suggestion, not least because it could stim- ry experience. Nothing reflects this better in India. The Northeast, for instance, with its marked deterioration of law and order. The partly a reflection of these constraints. ulate one sector of the economy when most than a trip to the country’s most visited unparalleled biodiversity and tribal culture, result of this inadequate policing is to raise True, domestic tourism has been growing others are waning. But Mr Modi may be put- monument, the Taj Mahal. It is located in remains mostly inaccessible by any trans- tourism costs: Those who can afford it will at a pace far faster than inbound tourism, ting the tourist cart before the infrastructure one of India’s most grungy cities. Uttar port link. According to the tourism ministry pay premiums for exclusive and secure but much of it is of the low-spending vari- and security horses. From heritage to Pradesh’s chief minister has had much to data, India has just 1,800-odd hotels/guest transport and hotels. When compared to the ety (pilgrimages and so on) that does not nature, cuisine to culture, India offers an say about this wonder of the modern world establishments offering 90,000 rooms; the hassle-free bandobast available in compet- yield the kind of surpluses needed to bring infinite variety that no other country can but has not felt it necessary to emulate the bulk of them are in the five-star category, ing destinations in Asia — Sri Lanka, Nepal, India’s tourism destinations up to interna- offer — facets that the Incredible India cam- PM's drastic clean-up of the ghats in his outside the reach of most domestic trav- Bhutan, Vietnam, Malaysia, and Singapore tional standards. But without those paign captures so well. Accessing the bulk of constituency of Varanasi. ellers. Air travel is expensive and travelling — India loses out. It speaks volumes for the upgrades, India will forever remain a coun- these tourism assets in a safe, hygienic and A visit to the monument involves nego- by train and bus involves an exercise in sup- lost opportunities of domestic tourism, try with an embarrassment of under- reasonably comfortable environment, how- tiating long queues and surly, unhelpful pressing all sensory perceptions. which the data from the United Nations’ exploited tourist riches. Designing a social stock exchange How to manage the Distilling key global learnings will be vital in ensuring that the Indian initiative is positioned for success in offshore rupee market helping social enterprises and non-profits to raise funds SURANJALI TANDON alternatives the design of the solution is ROOPA KUDVA & RAAHIL RAI nuanced across developing countries and, he Reserve Bank of India (RBI) task admittedly, must be tailored to the needs of uring her Budget presentation, Finance force on offshore rupee markets the economy. Given that India remains Minister Nirmala Sitharaman proposed a Trecently submitted its report. The committed to capital controls, the dilem- Dsocial stock exchange (SSE) under the regula- rationale for the existence and use of off- ma for policymakers is how to bring this tory ambit of the Securities Exchange Board of India shore markets for foreign exchange is market to India while keeping NDFs and (Sebi) to support social enterprises and non-profits in rooted in capital controls. The expansion onshore markets segmented. raising funds. SSEs can be helpful in bringing in sig- in cross-border capital flows coupled with The International Financial Services nificant additional capital to support entrepreneurs capital controls led to the demand for Centre (IFSC) offers a reasonable solution working to improve the lives of underserved popula- non-deliverable forwards (NDF) on the to this problem, since capital controls tions, thereby accelerating inclusive growth. part of those who have restricted access to under the Foreign Exchange Currently, there are no dedicated online informa- onshore forwards markets and seek to Management Act, 1999, do not apply. As tion or investment platforms to serve “for-profit” hedge foreign exchange rate movements. for segmenting the two markets, it is rec- social enterprises. As for non-profits, it is estimated Expectedly, the market is dominated by ommended that allowing only certain that there are about 3.1 million non-government Asian and Latin American currencies sub- approved entities and distinct net open organisations (NGOs); 25 per cent are engaged in reli- ject to convertibility constraints. positions should be allowed, and domes- gious activity, 22 per cent in community service, 20 The market for rupee NDF took off dur- tic banks should be restricted from par- per cent in education, 18 per cent in sports and cul- ing the 1990s and has expanded since. ticipating. In principle, the proposal ture, and 7 per cent in health services, according to Though it is difficult to measure fully, the seems tenable, but the main considera- research conducted by McKinsey for Omidyar Bank of International Settlements (BIS) tion remains — how to incentivise the Network India. estimated the average daily turnover in shift of offshore volumes to IFSC. Unless Some privately-owned crowdfunding platforms the offshore market for the rupee at $16.42 a specific gain is foreseeable from shifting for non-profits do exist, but cover only a small fraction billion in 2016, compared to the total for- the activity to IFSC, a fund or an investor of NGOs. There are a couple of information and eign exchange over the counter market may continue to operate in international accreditation platforms — GuideStar verifies, certi- turnover of $34.94 billion. Given the size of financial centres such as London. fies, lists, and provides information on NGOs for the offshore market, it can have ramifica- Other than extending market hours and potential donors. It has certified about 1750 NGOs. tions for exchange rate management by easing KYC norms, the report predictably GiveIndia connects donors to causes they care about the RBI. For example, during the steep recommends greater tax certainty and and lists about 500 NGOs on its platform, of which depreciation of the rupee in 2013, it was incentives. In so far as clarity in the appli- about 200 are ‘GiveAssured’, i.e. periodically accred- argued that the NDF market disrupted the cation of the law is concerned, it has been ited by GiveIndia. domestic market for foreign exchange. repeatedly observed to be uncertain, and Globally, at least ten SSEs have been set up, includ- Such an impact rests heavily the point is well taken. A defi- ing in Canada, the UK, Singapore, Kenya, South on the premise of a feedback There are price nite method must be pre- Africa, Brazil, Portugal, Mexico, Austria and Jamaica. loop between offshore and linkages between scribed for classification of They differ by (i) types of organisations listed — “for- onshore prices. the offshore and income derived from currency profit” vs non-profit; (ii) services offered — directory- While the empirical evi- onshore markets. derivatives, though the extent only, matching funders and organisations and pro- dence across countries is not During the of this problem for tax-exempt viding for direct online fund-raising; (iii) ability to definitive on whether depreciation of entities in IFSCs is not clear. trade securities — currently only 12 companies on onshore prices are affected the rupee in 2013, Further, the recommendation UK’s SSE can trade; (iv) methodology for accreditation by NDF or vice versa, the two the offshore that the tax regime be aligned of organizations and investors; and (v) the ability of are certainly associated. The market disrupted with offshore financial centres retail investors to participate. Distilling key global report affirms that there are the domestic is ambiguous. learnings will be vital in ensuring that the Indian ini- price linkages between the market for forex For one, each country taxes tiative is best positioned for success. offshore and the onshore income from derivative trad- What are some of the initial considerations in market, where the former influences the ing differently. Often, for the purpose of thinking about an Indian SSE? latter during periods of exchange rate pres- tax planning, funds operating in derivative The funding process has several components: sure. This is intuitive, since during peri- markets are domiciled in low-tax jurisdic- Information availability, matching of funders and cation resulting in lower valuations. A SSE can be were established as eligibility criteria for listing (such ods of pronounced external imbalances tions. One study estimates that in 2015, a organisations, accreditation/certification, fund-rais- particularly useful for social enterprises which are not as annual statements in standard formats) the great- the offshore market may fully price expec- fourth of global hedge funds were legally ing, and trading of securities. Currently, Indian stock “venture investment-like” and offer more modest est impact would be improvement of organisational tations that are not priced into tightly reg- registered in the Cayman Islands. Other exchanges enable trading of listed securities and financial returns. practices, as non-profits would be incentivised ulated onshore markets. structures being used include tax trans- reduction of information asymmetry between fun- We also need to understand whether special towards this. Moreover, a market for supporting non- The task force has proceeded on the parent entities. Further, tax exemption is ders and recipients. They do not provide matching measures are needed for “for-profit” social enter- profits to improve practices will develop. This will basis that the existing framework for cap- already in place for units operating with- and certification services. Therefore, at prises or if the regulatory provisions that increase funding flows, and eventually support non- ital account management will continue. in the IFSC. To add to this, in the recent the outset, clarity about which compo- A social stock already exist for smaller companies to profits in scaling up. The persistence of controls implies that Budget, category III Alternative nents of the fund-raising process the SSE exchange can raise equity and debt are adequate. An A realistic and multi-year phased rollout of stan- the market for NDF will not dissipate. Investment Funds, which includes hedge is trying to address is important. We then potentially help assessment of how effective the current dards is desirable, or else most non-profits may find Therefore, the challenge is to increase the funds operating in the IFSC, were also need to examine whether all these activ- for-profit social provisions are and what efforts are it too onerous to list on a SSE. Non-profit organisa- RBI’s reach in offshore markets that are at exempted from capital gains. Therefore, ities are permissible under the current enterprises in required to enable social enterprises to tions are predominantly very small — seven out of 10 the moment highly liquid and concen- many incentives are already in place and regulatory framework of Sebi and the raising their profile fully leverage them would be useful. have one or no full-time staff — with very limited trated in jurisdictions such as London, to offer anything additional, if at all pos- stock exchanges. and visibility, and For non-profits, a SSE can enable fund- budgets. Other considerations for an SSE include the Singapore and Dubai. The main concern sible, may not be sound from the point of A two-pronged approach would be attracting new raising as well as information on opera- ownership, operating model and institutional struc- for policymakers is that information on view of the domestic market or other required in conceptualising an SSE, since equity and debt tions and financials through standardised ture. For example, can it be housed under the current trades in these markets may not be fully financial instruments. the issues relating to “for-profit” social funds reporting. Ideally, certifications and stock exchanges, or is a separate institution required observed. An accurate estimation of these As is clear, the case for bringing the enterprises and non-profit organisations accreditations should be provided by and desirable? trades and, therefore, of exchange rates NDF market to the IFSC is to better manage are very different. independent organisations outside the SSE. In a sur- India is already a hub for social innovation. We can be useful for better exchange rate the exchange rate. Given that the commit- In the case of “for-profit” social enterprises, a SSE vey conducted by The Bridgespan Group, over 60 per now have an opportunity to be thoughtful about the management. ment to capital account management will can potentially help in raising their profile and visi- cent non-profits cited limited funding as a moderate above considerations and build a globally unique International experience tells us that continue, the IFSC is the only reasonable bility, attracting new equity and debt funders. or significant constraint to scale. A fund-raising plat- approach for robust and effective social stock varied approaches can be adopted to deal alternative. However, the extent to which However, the definition of a “social enterprise” needs form that has regulatory oversight can improve cred- exchanges. with offshore markets. It could entail allow- the offshore markets move to the IFSC careful thought. Our experience in working with 50 ibility and help ameliorate the difficulties non-prof- ing domestic agents to participate in off- remains to be seen. early-stage social entrepreneurs has shown that not its face in fund-raising. For donors, high quality and Roopa Kudva is managing director and Raahil Rai is chief of shore markets or bringing the market all purpose-driven entrepreneurs want the “social standardised reporting can boost confidence to pro- staff at Omidyar Network India, an investment firm focussed onshore by calibrating restrictions on par- The writer is Assistant Professor, National entrepreneur” tag, to avoid the risk of such a classifi- vide more funding. If common minimum standards on social impact ticipation. Even within these two broad Institute of Public Finance and Policy

> OTHER VIEWS Foreign investors finally have Contain the NBFC crisis ‘Unpatriotic’ Indians? something to cheer about Framework for quick resolution needed Unfair epithet for large families Sebi’s liberalised norms for FPIs will Earlier this week, Dewan tion of financial firms is a Students of patriotism may are unpatriotic? Housing Finance Corporation challenging process as, unlike find some of the lessons Such a suggestion is prob- make Indian markets attractive Ltd (DHFL) defaulted on its in the case of non-financial imparted by leaders of the lematic and unfair. It could repayment obligations to the firms, there are depositors to Bharatiya Janata Party to be also be perceived as a rather On Wednesday, the Securities and Exchange Board of India tune of ~1,571 crore. Clearly, deal with. The inter-linkages truly mystifying. Take, for ingenious way of absolving (Sebi), based on the recommendations of the HR Khan com- NBFCs/HFCs continue to between financial firms and instance, the new spin that successive administrations mittee, eased several regulatory restrictions that are likely to struggle to repay their loan the broader economy com- the prime minister gave on of their responsibilities. A make life easier for foreign portfolio investors (FPIs). Among a obligations and raise low-cost plicate matters. As the events the subject while addressing combination of illiteracy, slew of measures, the financial markets regulator has simplified funds. As credit flow through of the past few months show, the nation on this year’s social orthodoxy and eco- the registration process for FPIs by doing away with the broad- this channel has slowed down, there is a need for regulators Independence Day. nomic prerogatives may based eligibility criteria, which required a minimum of at least the ripple effects are being felt to step in quickly. Delays in Expressing legitimate con- have forced individuals to 20 investors in a foreign fund, and certain documentary require- in the broader economy. One recognition and failure to act cern on the challenges posed raise large families. Shallow ments. FPIs can now also engage in the off-market sale of their way, perhaps, to have con- in time lead to higher losses. by India’s massive population investments in education, shares with fewer restrictions. Further, Sebi has allowed entities tained the crisis, and prevent it A long drawn out insolvency — the country is set to over- awareness as well as poorly registered at an international financial services centre to be from spreading throughout process for financial firms, as take China as the most popu- thought out family control automatically classified as FPIs. These measures to cut red the financial sector, engulfing in the case of IL&FS, can have lous nation in the world — initiatives — has India for- tape will help lower the regulatory burden on investors, glob- mutual funds as well, would far-reaching ramifications for Narendra Modi seemed to gotten the dark chapter of alise India's financial markets, and aid the growth of the broad- have been through quick and the economy. In comparison, have suggested that the forced sterilisations of the er economy by increasing access to growth capital. orderly resolution/liquidation an early resolution can lessen minuscule segment of poor? — have exacted a steep Capital in excess of ~20,000 crore has left Indian shores in markets across the world, it remains to be seen whether Sebi’s of firms in trouble. But the res- the impact of firm failure on Indians who decided to keep price on the nation and its the last few weeks after Finance Minister Nirmala Sitharaman’s present move will yield immediate benefits. Even if it fails to olution framework, as it exists, the economy, and lead to the size of their brood small people. What India needs is a budget decision to increase taxes on FPIs. Policymakers were do so, the move will still help Indian markets become more makes it difficult to close more efficient allocation are patriots. But is the prime united and robust response clearly under pressure to do something to allay the fears of for- attractive to foreign investors in the long-run. down financial firms such as of capital. minister implying that those to check population growth. eign investors, so the timing of Sebi’s move is no surprise. But banks and NBFCs. — a fairly large number of given the broader trend of capital flowing out of emerging The Hindu, August 23 The resolution/liquida- The Indian Express, August 23 Indians — with large families The Telegraph, August 23 12 MUMBAI | 25 AUGUST 2019 1 > Bridgingthedivideforfirst-generationlearnersinAndhra Bridge International Academies is proving to acknowledge its work. trained to become teachers. turning up at the schools to under- In India, what stood out for Almost all the schools were emp- stand how their results were out- that its methods yield results Bridge were two trends. First, par- ty and had no students so a local, shining almost all others. Parents ents were highly aspirational for their door-to-door drive was started to from other schools too began to ANJULI BHARGAVA through sub-Saharan Africa and children and saw education as a encourage children to enroll. It flock to the Bridge schools to see if New Delhi, 24 August found the same story. means to an end. resulted in close to 175 students join- their wards could join. Meanwhile, By 2010, when Sujatha Muthayya, Second, a massive migration out ing all four schools. the teachers trained by Bridge Sometimes hitting the bottom of the now 42 and vice president for policy of government schools into private Since Bridge has taught many became mini stars. charts can work to your advantage. and partnerships for the outfit, came schools was taking place, accompa- first generation learners in other From four schools and a few In 2009, when India appeared fourth across Bridge International nied by a desire that children should countries, it brings methods that hundred students in 2015-16, Bridge from the bottom of a list of school Academies, it was already operating learn English for a better destiny. are proven. “Experience has shown is now working in six schools in the learning outcomes — after Kenya, in Kenya and Uganda, two educa- As it finalised its plans to enter us what works and what doesn’t district with close to 800 students. Uganda, Nigeria — it caught the tionally backward countries, India, Bridge found the Andhra and that helps avoid mistakes,” said Globally, its initiative has impacted attention of the founders of Bridge After spending a decade in Indian India. Two, Bridge’s programme could be applied in India. Pradesh, Uttar Pradesh and Muthayya. half a million students so far. International Academies. education, Muthayya had started could make some impact as its focus By then, its results had been Rajasthan governments keen to work The third party assessments But half a million is a drop in the India lagged behind what was questioning what she was doing and was on “impeccable execution”. acknowledged and it had become a with it. Andhra Pradesh said that it speak for themselves. Upper kinder- ocean of 600 million students who expected of a country of its stage of whether it had any impact whatso- Scale, of course, might be harder — part of the global conversation. In was consolidating some of its schools garten students at Bridge could solve are not receiving a good education. development and dimension. It was ever. She realised that many good there are 600 million children Kenya, Bridge pupils outperformed (for every five schools, it was consol- an additional 5.5 addition sums per Bridge’s plan is to move into public- close to the worst performers in initiatives in the sector started with worldwide who don’t get the educa- the national average by over 10 per- idating students, teachers and infra- minute than peers at neighbouring private partnerships with govern- learning levels and outcomes. Co- a bang and fizzled out. A majority tion they ought to — but at least centage points in 2017. In Uganda, structure) but would have some schools while Standard 3 solved an ments across countries rather than founders Jay Kimmelman and failed to achieve any scale. “I was some impact would be visible. pupils scored over 93 per cent com- empty buildings and ready infra- additional two subtraction sums per setting up its own schools every- Shannon May began to look at India increasingly cynical about anyone In 2015, Muthayya joined Bridge pared to a national average of 56 structure to offer. minute. Standard 3 Bridge students where, which is a slower process. closely to see why public education who made tall claims about large International Academies and started per cent. In Liberia, Bridge students In September 2015, Bridge took read 14 more sight words and 26 India presents its own challenges. systems were failing children. scale transformation”, she said. working on its projects in Kenya with were found to learn twice as fast as on four government schools in words in a story per minute. In fact But here too, the goal is to prove the While working on her PhD in But Bridge presented a unique the intention of bringing its work to their peers. Vijaywada district, Andhra Pradesh Standard 3 Bridge students more model’s success, convince govern- rural China, May had noticed the opportunity. One, it would give her India. The organisation had by then Slowly but surely, Bridge was and launched within eight months than doubled their reading speeds ment schools to work in partnership lack of basic education that children the chance to work in other equally worked with 155,000 first generation being pulled into the global debate for the session starting in April 2016. in less than one year. to achieve scale, and then replicate in under-privileged communities needy countries that provided a learners in Kenya, Uganda and with the United Nations and other Around 40 individuals were hired The improved results made gov- the same work in all states. Andhra received. In 2007, the two travelled good mirror for comparison with Nigeria. Lessons had been learnt that multilateral organisations beginning from the local community and ernment officials wake up and start Pradesh is just the first step. Abrogation of Tradewarpushesgold Bizenergyto J&K’s isolation led to Art370 led to integration: futuresto record high powerIndia radicalisation: Modi to $5trillion: Amit Shah DILIP KUMAR JHA MCXGOLD Mumbai, 24 August Future price (~/10g) PRESS TRUST OF INDIA Union Home Minister Amit RBI Governor Abu Dhabi, 24 August Shah on Saturday said the After China and the US 40,000 38,765 abrogation of Article 370 fired fresh salvos at each 38,000 rime Minister Narendra enabled the complete integra- other in the ongoing trade PRESS TRUST OF INDIA Modi has said Jammu and tion of Jammu and Kashmir war on Friday, gold futures 36,000 Singapore, 24 August P Kashmir’s special status with the Indian Union. climbed to lifetime highs, 34,000 was revoked to end its “isolation” He also said the Parliame- as investors retreated to the The RBI will continue to unlock which allowed some of the youth nt has made Jammu and Kas- safe haven provided by the 32,000 entrepreneurial energies and set the to be “misguided, get radicalised hmir an integral part of India precious metal. 32,098 country firmly on track to become $5 and take to violence and terror- by ending Article 370, under On the Multi Commodity 30,000 trillion economy in the next five May 31,’19 Aug 23,’19 ism”. Defending government’s the leadership of Prime Mini- Exchange, gold futures for years, Governor Shaktikanta Das said moves, he said it was India’s ster and India’s most popular delivery in October gained in Singapore on Friday. “internal steps” which was taken leader, Narendra Modi. Shah 1.69 per cent on Friday to In India, the rise in gold strong for gold with height- The RBI chief said the slight slow- in a “completely democratic, was speaking at the passing trade at an all-time high of prices as well as the depre- ened trade tensions between down in the last quarter was a tem- open, transparent and constitu- out parade of IPS probationers ~38,810 per 10 grams. Gold ciation in the rupee value the US and China. We estim- porary one and the economy is like- tional” manner. at Sardar Vallabhbhai Patel futures on the Comex has pushed its prices to ate gold price to hit $1,630 ly to end the fiscal with higher growth Modi in the UAE on the sec- National Police Academy jumped by $30 to trade on new highs. an oz in the international rate of close to 7 per cent. ond leg of his three-nation tour, in (SVPNPA) in Hyderabad. Friday at $1,536.40 an oz. In the spot Zaveri Bazaar market, translating thereby “The policy focus will continue to an interview with the Khaleej “The complete merger of US President Donald in Mumbai, pure gold prices to ~42,000 per 10 grams in be on unlocking...entrepreneurial Times on Friday, said his govern- PM Narendra Modi signing during the release of a stamp in Jammu and Kashmir with Trump on Friday tweeted, jumped to trade at ~38,800 the Indian market in the energies and set India firmly on the ment scrapped Article 370 of the presence of the Crown Prince of Abu Dhabi PHOTO:PTI Indian Union did not happen indicating trillions of dollars on bills that included the medium term,” said Kishore trajectory towards its aspirations of the Constitution to end the with the existence of Article of loss in trade with China goods and services tax of 3 Narne, associate director, becoming a $5 trillion economy with- isolation that had kept Jammu 370,” he added. and asked US companies to per cent on Saturday. Motilal Oswal Financial in the next five years,” he said at a and Kashmir underdeveloped “to Modi releases PM launches RuPay Paying glowing tributes to look for other markets. “The dollar nosedived Services. dialogue with Indian business com- serve the vested interests of a few.” postage stamps on card in UAE, to help the country’s first Home Beijing unveiled a new on Friday. Certainly, the Since the Union Budget, munity. As the financial sector “This isolation also allowed Mahatma Gandhi Indian tourists Minister Sardar Vallabhbhai round of retaliatory tariffs fundamentals are very gold has become costlier by repairs and emerge out of the bal- some of the youth to be misguid- Patel, he said Hyderabad on about $75 billion worth strong for the yellow met- 8-9 per cent because of a 2.5 ance sheet stress, a speedy revival of ed, get radicalised and take to Prime Minister Narendra Prime Minister Narendra became a part of India due to of US goods beginning next al,” said Naveen Mathur, per cent increase in import demand in the economy assumes violence and terrorism,” he said. Modi and Abu Dhabi Crown Modi on Saturday the police action carried out month. The intensifying director, Anand Rathi Share duty to 12.5 per cent and vital importance in order to reinvig- “We cannot afford to let these Prince Sheikh Mohammed launched the RuPay card (to unite the erstwhile trade war has created a and Stock Brokers. about a 5 per cent deprecia- orate, he told over 200 business exec- tendencies get any foothold in bin Zayed Al Nahyan on in Abu Dhabi, making the Hyderabad state of Nizam) mood of uncertainty. “Fundamentals are very tion in the rupee. utives from leading corporations. our harmonious society and dis- Saturday released postage UAE the first country in under his (Patel’s) leadership. “Stimulating demand is currently tract us from the primary tasks of stamps on Mahatma Gandhi West Asia to initiate the the overriding priority of both the growth and development of the to commemorate his 150th Indian indigenous system Government and RBI. Some structur- entire country. I appreciate the birth anniversary. “To mark of electronic payment. The Navy on high alert, Donimalai mine e-auction put on hold al reforms are also required, and I am understanding the UAE and its Gandhi Ji’s 150th Jayanti, a UAE receives about three happy to note that some structural commemorative stamp was million Indian tourists strict vigil in TN leadership have shown for our T E NARASIMHAN tiating the auction process Dal (Secular) administration reforms are on the anvil,” Das said. released by PM @narendra- annually. Acceptance of steps and our reasons for taking The Indian Navy has sounded a for the mine. had decided to levy a pre- He noted that with the budget for modi and His Highness Rupay card in UAE will Chennai, 24 August them,” said Modi, who held talks high-alert at sea in view of On August 17, the mium of 80 per cent on the the remaining part of the fiscal Crown Prince lower the charges as with the Crown Prince of Abu intelligence inputs that six The department of mines Karnataka government had iron ore extracted from the announced, government spending @MohamedBinZayed in Abu tourists will save on Dhabi, Sheikh Mohammed bin Dhabi," PMO tweeted. PTI exchange rate. PTI members of the Lashkar-e- and geology of the Karnataka decided to cancel the lease mine while extending the would see a boost, which will have Zayed Al Nahyan on Saturday. Taiba have intruded into Tamil government has decided to and put the Donimalai mine lease. The firm did not salutary impact on the Responding to questions Modi Nadu, as strict surveillance cont- put its scheduled e-auction on auction. The company agree with the condition economy. said, “As far as Article 370 is con- NRIs urged to invest in J&K inued in various parts of the of the Donimalai mine on said even with no produc- and stopped operations in Das was on a two-day visit to cerned, our internal steps were state for the second day on Sat- hold, following a Mines Trib- tion at Donimalai, it will November 2018.The firm Singapore during which he met taken in a completely democratic, Prime Minister Narendra Modi said “political stability and urday. Security was tightened in unal order to stay the cance- achieve its annual produc- moved court and got a Deputy Prime Minister Heng Swee open, transparent and constitu- predictable policy framework” have made India an “attrac- Tamil Nadu on Friday following llation of the lease to NMDC. tion target as it has increased favourable order. While it Keat, and his counterpart Monetary tional manner. They were tive” investment destination as he urged the Indian business reports that six members of the The tribunal had passed production in other mines. was planning to start opera- Authority of Singapore Managing designed to end the isolation that leaders in the UAE to invest in Jammu and Kashmir, which he terror outfit LeT had infiltrated its order on Thursday, and NMDC and the state gov- tions the new Bharatiya Director Ravi Menon. He also met had kept J&K underdeveloped to said could emerge as the country’s growth engine. PTI the state by sea from Sri Lanka had also forbidden the ernment locked horns when Janata Party government top leaders of financial sector and serve the vested interests of a few.” and moved to different cities. PTI state government from ini- the former Congress-Janata cancelled the order. global financial companies.

FESTIVE MOOD

Members from a Govinda mandal build a pyramid to break the pot (dahi handi) on the occasion of the Krishna Janmashtami festival celebrated in Mumbai on Saturday. As many as 51 ‘Govindas’ were injured in Mumbai during dahi handi celebrations, marking the birth of Lord Krishna, which remained subdued in the wake of floods in western Maharashtra PHOTO: KAMLESH PEDNEKAR