1. IMF Says India's Economy Is an Elephant That's Starting to Run, Flags Risks
India is on track to hold its position as one of the world’s fastest-growing economies as reforms start to pay off, according to the International Monetary Fund.
The $ 2.6 trillion economy was described by Ranil Salgado, the IMF’s mission chief for India, as an elephant starting to run, with growth forecast at 7.3 per cent in the fiscal year through March 2019 and 7.5 per cent in the year after that. The nation accounts for about 15 per cent of global growth, according to the Washington-based fund.
Key risks flagged by the IMF in its annual Article IV assessment of the economy include higher oil prices, tightening global financial conditions and tax revenue shortfalls. Authorities should take advantage of stronger growth to bring down debt levels, simplify the consumption tax system and continue to gradually tighten monetary policy, it said.
(Source: Business Standard)
2. RBI to Pay ₹ 50,000 Crore Dividend to Govt for Financial Year 18
The Reserve Bank of India (RBI) will transfer ₹50,000 crore of its surplus money to the government, the highest since 2015-16, in a partial relief for the latter struggling to replenish public sector banks.
The transfer gives the government more elbow room to infuse capital into the banks it owns. In October 2017, the government had said it would infuse ₹ 2.11 trillion into public sector banks through a mix of recapitalization bonds (₹1.35 trillion), direct infusion from budgetary allocations (₹18,000 crore) and market borrowing (₹58,000 crore).
“Based on consolidated numbers, one would have expected the surplus to be lower. However, this is good news from the fiscal perspective in a situation when divestment is looking uncertain,” said Abheek Barua, chief economist, HDFC Bank.
The Economic Surveys of FY16 and FY17 had also pressed for a bigger transfer of excess capital from RBI to the government.
(Source: Livemint)
3. Have Accepted RBI Directorship in Public Interest: Swaminathan Gurumurthy
The government has appointed Chartered Accountant Swaminathan Gurumurthy, also considered as an RSS idealogue, on the board of the Reserve Bank of India (RBI).
Gurumurthy, who had referred demonetisation decision as the equivalent of Financial Pokhran, is said to be associated with the Rashtriya Swayamsevak Sangh (RSS) affiliate Swadeshi Jagran Manch.
The Appointments Committee of the Cabinet has approved his appointment as non-official director on the central board of the RBI for a period of four years, an order issued by the Personnel Ministry said.
"This is the first directorship ever. Never accepted any private or PSU directorship. Not even audit of PSUs or Pvt companies. Wanted to be free to speak. But when pressure built up, I am needed to do something in public interest, I had to accept," Gurumurthy said in a tweet.
(Source: PTI)
4. NCLAT Asks Tata Sons to File Reply to Mistry Challenge to Firm Being Converted Private
The National Company Law Appellate Tribunal (NCLAT) on Wednesday, 8 August sought a reply from Tata Sons by 10 August to a petition filed by its ousted chairman Cyrus Mistry challenging the move to convert the holding company of salt-to-software conglomerate to a private firm from deemed public company.
The NCLAT listed the matter for hearing on 14 August.
The two-judge NCLAT Bench was hearing a petition filed by Cyrus Investments Pvt Ltd seeking a stay on conversion of Tata Sons into a private company as well as challenging a 9 July order of the Mumbai bench of National Company Law Tribunal (NCLT) that had upheld Mistry's sacking.
Last year in September, shareholders of Tata Sons had voted in favour of turning it into a private limited company despite opposition by Mistry's family, which is the single largest shareholder of the holding company.
(Source: PTI)
5. PNB in Talks with I-T, Excise Departmens to Sell Erstwhile Headquarters in Delhi
State-run Punjab National Bank (PNB) on Wednesday, 8 August, said it is in negotiation with a few government departments, including income tax and central excise, to sell its erstwhile headquarters situated at the Bhikaji Cama Place in New Delhi.
Its managing director and chief executive officer, Sunil Mehta, said the bank is going for a second round of valuation of the south Delhi property due to high demand.
“It (talks) is at the stage of negotiation. There are three government agencies that we are in discussion with. Now we are negotiating for better valuations because we are finding good interest in it,” Mehta told reporters.
He said the departments the bank is in negotiations with include income-tax and central excise.
(Source: PTI)
6. CCI Questions Flipkart’s Discounting Practices
The Competition Commission of India (CCI) said that discounting practices by Flipkart may have to be reviewed by the relevant authorities, putting pressure on regulators to clamp down on discounts on online platforms.
On Wednesday, 8 August, CCI approved Walmart’s $16 billion acquisition of Flipkart but expressed concerns about the latter’s discounting practices. “The issues concerning FDI (foreign direct investment) policy would need to be addressed in that policy space to ensure that online market platforms remain a true marketplace providing access to all retailers,” CCI said in its order, referring to complaints by small traders against the deal.
Small traders led by the Confederation of All India Traders had complained about discounting by Flipkart and preferential treatment to specified sellers on its marketplace, among other things.
(Source: Livemint)
7. Traders' Body to Move Court Against CCI Nod to Walmart-Flipkart Deal
Traders' body CAIT, on 8 August, described as 'most unfortunate' the Competition Commission of India's move to clear the Walmart-Flipkart deal and said it will approach the court against the decision.
The Competition Commission, on 8 August, said it has approved US retail giant Walmart's proposed acquisition of Flipkart.
"It is most unfortunate that leaving aside the objections raised by CAIT in CCI , the Commission has approved the deal. Without giving any opportunity of hearing to CAIT, the CCI has flayed principle of natural justice.
"We deeply condemn such an attitude and will certainly move the court against the decision of CCI. CAIT has called an emergency meeting of its governing council on August 19 at Nagpur to take stock of the situation and finalise strategy for a nationwide movement," CAIT Secretary General Praveen Khandelwal told PTI.
(Source: PTI)
8. Air India Should Be Made Profitable Before It’s Privatized: NITI Aayog
State-run Air India Ltd should be made profitable before it is privatized so that the government can fetch a better value for the loss-making national carrier, said the vice-chairman of federal policy think tank NITI Aayog Rajiv Kumar on 8 August.
The suggestion comes at a time when the government is keeping the carrier afloat with doses of capital infusion after a failed attempt at privatization in May highlighted investors’ discomfort with the sale conditions and their aversion to buying a loss-making company at a time of high jet fuel prices.
Kumar said the government should bring in a professional board that can run the carrier competitively before it decides to dispose the assets. “That is how these assets will fetch maximum value. This approach may very well be tried on Air India,” he added.
(Source: Livemint)
9. Govt May Release Second Draft of E-Commerce Policy in a Fortnight
The second draft of e-commerce policy incorporating inputs from stake-holders is expected to be placed in public domain in a fortnight, a senior official said on 8 August.
"The Government wants the e commerce policy to be in place as soon as possible," the Joint Secretary in the Commerce and Industry Ministry, Sudhanshu Pandey, said at a roundtable organised by traders' body CAIT.
An initial draft of the proposed national ecommerce policy was circulated among stakeholders last month to receive their comments .
The draft suggested to introduce a pre-set timeframe for offering differential pricing or deep discounts by e-commerce players to customers.
Any group company of an online retailer or marketplace may not be allowed to directly or indirectly influence the price or sale of products and services on its platform, according to the draft.
(Source: PTI)
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