India wants to have trade deal with US to avoid tariffs: Donald Trump

President Donald Trump Saturday said that India wants to have a trade deal with the US because it does not want him to impose tariffs on their products.
Trump's remarks, for the second time in recent weeks, comes days after Assistant US Trade Representative Mark Linscott returned from India where he had detailed discussion with senior Indian officials on bilateral trade and a possible trade deal between the two countries.

Trump often accuses India of imposing 100 per cent tariffs on American products.
"We have a country, take India. Good relationship. They want to make a deal now because they don't want me to do what I'm going to do, with I have to. So, they (Indians) call us. They didn't want to make a deal with anybody else," he said.
Trump referred to India in the context of his repeated allegation that other countries have been taking advantage of America in the past.
Trump in early this month had said India wanted a trade deal with the US despite the US administration's tough stance on the issue.
"Take India. You talk about free trade. So, let's say they (Indians) charge us 60 per cent tariff on a product. And for the same product when they send it in (America), we charge them nothing. So now I want to charge them 25 per cent or 20 or 10 or something," Trump said.
"What do you think? That's not free trade. We don't like it. I said, where are these people coming from? So, think of it. Where are they coming from? You have no idea how difficult it is. Where are they coming?" Trump said on Saturday referring to the conversations he is having with India.
Trump told the crowd that he is using India just as an example.
The president said he can give examples of other countries which are "brutal" to what they do with the United States.
"I could give you (examples of) others that are brutal, just brutal what they do to us, how they take advantage of the stupidity. We never even had people negotiate, they just do whatever they want," Trump said as he went back to the India example.
"Remember this? A lot of the people that are fighting me in what I'm doing have ownership of companies in these other countries. Remember that please. Remember that, or they're represented by lobbies," Trump said, as he lashed out at those who are opposing his America First trade policies.
Trump said nobody wants to talk about the jobs created and nobody wants to talk about all the money that's flowing into the coffers of the United States of America, he said.
"The people that are against it are usually having companies...you know, you go to these other countries, they have companies there too," he alleged.

IL&FS secures lifeline as shareholders approve fundraising via debt, equity

Troubled Indian shadow bank Infrastructure Leasing & Financial Services Ltd, whose recent debt defaults sparked concern about contagion in the nation's financial markets, secured a lifeline after shareholders approved its plans to raise money through debt and equity.
Stockholders green-lit IL&FS' plans to raise as much as Rs 150 billion ($2.1 billion) through a non-convertible debt issue, hike the firm's borrowing limit by 40 per cent to Rs 350 billion and increase its share capital to enable a rights offering, the company said in a filing.
ALSO READ: No decision on IL&FS liquidity infusion yet; board plans restructuring
The firm finances infrastructure projects across the world's fastest-growing major economy and is considered systemically important by the central bank. Its defaults on commercial paper from August sparked concern among households holding mutual funds invested in such debt, and forced banks and mutual and pension fund managers to brace for further losses.
IL&FS' investors include biggest Indian insurer Life Insurance Corp, top lender State Bank of India, largest mortgage lender Housing Development Finance Corp and Japan's Orix Corp. VK Sharma, the chairman of biggest shareholder LIC, on Friday said the beleaguered group can raise Rs 600 billion by selling assets.

ALSO READ: LIC, Orix, SBI to subscribe to Rs 45 billion IL&FS rights issue
IL&FS on Saturday appointed Alvarez & Marsal to devise a restructuring plan that will be implemented upon approval by the board and stakeholders.

Oil at $100 to do more harm than good to global growth; India among losers

Rising oil prices are prompting forecasts of a return to $100 a barrel for the first time since 2014, creating both winners and losers in the world economy.
Exporters of the fuel would enjoy bumper returns, giving a fillip to companies and government coffers. By contrast, consuming nations would bear the cost at the pump, potentially fanning inflation and hurting demand.

The good news is that Bloomberg Economics found that oil at $100 would mean less for global growth in 2018 than it did after the 2011 spike. That's partly because economies are less reliant on energy and because the shale revolution cushioning the US.
Ultimately, much depends on why prices are pushing higher. A shock amid constrained supply is a negative, but one due to robust demand just reflects solid growth. Both forces are now in play, driving Brent crude up about 22 per cent this year.
1) What does it mean for global growth?
Higher oil prices would hurt household incomes and consumer spending, but the impact would vary. Europe is vulnerable given that many of the region's countries are oil importers. China is the world's biggest importer of oil and could expect an uptick in inflation.
There are also seasonal effects to consider, with winter looming in the Northern hemisphere. Consumers can switch energy sources to keep costs down, such as biofuels or natural gas, although not quickly. Indonesia already has instituted measures to push more use of biofuels and limit the economy's reliance on imported fuel.
For a sustained hit to global growth, economists say oil would need to hold above $100. The dollar's gain of this year doesn't help though given crude is priced in greenbacks.
2) How can the world economy absorb oil at $100?
Bloomberg Economics found that $100 oil will do more harm than good to global growth. Yet there are important differences in the condition of the world economy today compared with 2011.
"The shale revolution, lower energy intensity, and higher general price levels mean the impact will be smaller than it once was," economists led by Jamie Murray wrote in a recent report. "The price of a barrel will have to go much higher before global growth slips on an oil slick."
3) How will Iran and Trump impact the market?
Geopolitics remains a wild card. Renewed US sanctions on Iran are already crimping the Middle East nation's oil exports. While President Donald Trump is pressuring the Organization of Petroleum Exporting Countries to pump more, there is limited spare production capacity. In addition, supply from nations including Venezuela, Libya and Nigeria is being buffeted by economic collapse or civil unrest. Still, Goldman Sachs analysts predict $100 will not be passed.
4) Who wins from higher oil prices?
Most of the biggest oil-producing nations are emerging economies. Saudi Arabia leads the way with a net oil production that's almost 21 per cent of gross domestic product as of 2016 -- more than twice that of Russia, which is the next among 15 major emerging markets ranked by Bloomberg Economics. Other winners could include Nigeria and Colombia. The increase in revenues will help to repair budgets and current account deficits, allowing governments to increase spending that will spur investment.
5) Who loses?
India, China, Taiwan, Chile, Turkey, Egypt and Ukraine are among the nations who would take a hit. Paying more for oil will pressure current accounts and make economies more vulnerable to rising US interest rates. Bloomberg Economics has ranked major emerging markets based on vulnerability to shifts in oil prices, US rates and protectionism.
One of the biggest winners might also find itself on the losing end: Oystein Olsen, Norway's central bank governor, warned that western Europe's biggest petroleum producer risks problems if the industry takes its eyes off controlling costs.
6) What does it mean for the the world's biggest economy?
A run-up in oil prices poses a lot less of a risk to the US than it used to, thanks to the boom in shale oil production. The old rule of thumb among economists was that a sustained $10 per barrel increase would shave about 0.3 per cent off of US output the following year. But tallies now, including that of Moody's Analytics chief economist Mark Zandi, pencil in a hit of around 0.1 per cent.
While the diminishing American reliance on imported oil has positive economic consequences at the industry level, poorer households would feel the weight of higher prices at the pump. They spend about 8 per cent of their pre-tax income on gasoline, compared to about one per cent for the top fifth of earners.
7) Will it lead to higher inflation around the world?
Energy prices often carry a heavy weight in consumer price gauges, prompting policy makers including those at the Federal Reserve to focus simultaneously on core indexes that remove volatile energy costs. But a substantial run-up in oil prices could provide a more durable uptick for overall inflation if the costs filter through to transportation and utilities.
8) What does it mean for central banks?
If stronger oil prices boost inflation, central bankers on balance will have one less reason to keep monetary policy loose. Among the most-exposed economies, central bankers in India already are warning about the impact as the nation's biggest import item gets more expensive. Greater overall price pressures also could prompt faster monetary policy tightening in economies such as Thailand, Indonesia, the Philippines and South Africa.

Crisis-hit IL&FS can raise Rs 700 billion by selling assets, says LIC

Beleaguered IL&FS can raise up to Rs 700 billion by selling its assets, the Life Insurance Corporation of India Chairman V K Sharma said in New Delhi on Friday. LIC was open to raising stake in the company by participating in its rights issue, he added.
Sharma, along with State Bank of India Chairman Rajnish Kumar and Central Bank of India Managing Director Pallav Mohapatra, met Economic Affairs Secretary Subhash Garg in the finance ministry on Friday to discuss options to bail out IL&FS.

Earlier in the day, the Reserve Bank of India also met IL&FS shareholders in Mumbai. The meeting was attended by IL&FS Chairman Hemant Bhargava and top officials of Orix Corporation of Japan. The meeting was called by the RBI to discuss how the shareholders plan to help IL&FS to tide over the crisis. Speaking to reporters before the meeting in New Delhi, Garg said the government was monitoring the situation closely and would ensure there is no undue impact on the markets due to IL&FS.
“IL&FS is a large company in infrastructure. It has a lot of connection with government departments and does a lot of public-private partnership projects and therefore is an important, significant entity. The Centre will take measures to see that there is no undue impact on what happens in IL&FS,” Garg said.
Sharma said around Rs 700 billion could be recovered from IL&FS’ asset sales, and the shareholders were trying to find a solution to the rest of the Rs 910 billion debt. When asked if the public sector behemoth would buy more stake in IL&FS, Sharma said all options were on the table.
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IL&FS, which is hosting its shareholders’ meeting in Mumbai on Saturday, has sought to raise Rs 45 billion from its shareholders to meet its liquidity crisis.
ALSO READ: IL&FS crisis: Govt to take action to avoid undue impact on system
LIC owns 25.34 per cent in IL&FS and HDFC 9.02 per cent. Central Bank of India (7.67 per cent) and State Bank of India (6.42 per cent) own small stakes in IL&FS, which defaulted on debt repayments since mid-September. The Indian institutions jointly hold around 49 per cent in IL&FS while Orix Corporation, Japan, owns 23.54 per cent and the Abu Dhabi Investment Authority 12.56 per cent.
Crisis-hit IL&FS can raise Rs 700 billion by selling assets, says LIC The rights issue will help the company to meet its immediate demand for funds from its several subsidiaries which have also defaulted to loans. IL&FS is raising shares at Rs 150 a share. Some of the shareholders like Central Bank of India are not interested at investing at a premium for the company. With LIC and State Bank of India agreeing to pump in more money into the company, insiders said the institution will be able to meet its commitments. But most of IL&FS lenders are gearing up for a haircut. “A lender can expect a 30-40 per cent haircut,” said a banker.
IL&FS has moved the NCLT on Monday “seeking certain reliefs” in connection with filing of scheme of arrangement and said the scheme will be prepared in compliance with applicable laws and subject to necessary consents of the shareholders, creditors and board of directors of the relevant entities, the company said in a filing with the Bombay Stock Exchange. The NCLT is yet to hear the petition.
Sections 230 to 240 of the Companies Act, 2013, contain provisions on compromises, arrangements and amalgamations, that covers compromise or arrangements, mergers and amalgamations, and corporate debt restructuring. After an application is filed with the National Company Law Tribunal, the tribunal calls for a meeting of its shareholders and lenders and then the company’s debt restructuring plan will be put to vote. The shareholders of IL&FS will be informed about the debt recast plan on Saturday at the annual general meeting of shareholders. One of IL&FS’s Small Industries Development Bank of India (Sidbi) has also moved the NCLT Mumbai against IL&FS seeking its money back. IL&FS owes close to Rs 10 billion to Sidbi.
The subsidiaries which have moved the NCLT include IFIN, ITNL, IL&FS Energy Development and IL&FS Engineering & Construction Ltd. The other companies include roads and construction companies.

RBI cancels meeting with IL&FS shareholders, next date not decided yet

The Reserve Bank of India (RBI) has cancelled the Friday's meeting with the shareholders of debt-laden Infrastructure Leasing and Finance Services (IL&FS), according to banking sources.
The apex bank had earlier called a meeting with key shareholders of IL&FS, including Life Insurance Corporation of India (LIC) and State Bank of India, after the company and its subsidiaries defaulted on repayments of various debt instruments.

"Tomorrow's meeting has been cancelled. As a regulator, they want to know what is the course of action and what is the road map that the firm is taking," a source said.
"RBI wants details of the plan for future or corrective action which are to be taken," another source said.
The next date for meeting has not been decided yet, the source added.
IL&FS's annual general meeting is scheduled for September 29 here.
ALSO READ: Debt-ridden IL&FS scraps dividend to its shareholders ahead of AGM
LIC and Orix Corporation of Japan are the largest shareholders of IL&FS with 25.34 and 23.54 per cent stake, respectively, while Abu Dhabi Investment Authority, HDFC, Central Bank of India and SBI hold 12.56 per cent, 9.02 per cent, 7.67 per cent and 6.42 per cent, respectively.
IL&FS group is facing serious liquidity crisis and has defaulted on interest payment on various debt repayments since August 27. It has over Rs 910 billion in debt.
The company needs an immediate capital infusion of Rs 30 billion and is planning a Rs 45 billion rights issue.
At a meeting held earlier this month, the key shareholders of the debt-ridden company, including LIC, SBI and HDFC, had kept a pre-condition for it to raise funds through its assets or non-core businesses, before any additional money could be pumped in.
ALSO READ: IL&FS withdraws declaration for seeking shareholders' nod for dividend
There have been reports that IL&FS has even put on block its headquarters in the city for around Rs 13 billion.
On September 4, it came to light that IL&FS had defaulted on a short-term loan of Rs 10 billion from Sidbi, while its subsidiary has also defaulted Rs 5 billion dues to the development finance institution.
On Monday, IL&FS Financial Services also defaulted on repayment of commercial papers due that day.

Are mosques integral to Islam? SC declines to refer issue to 5-judge bench

The Supreme Court on Thursday declined to refer to a five-judge Constitution bench the issue of reconsideration of the observations in its 1994 judgement that a mosque was not integral to Islam which had arisen during the hearing of Ayodhya land dispute.
In a majority verdict of 2:1, the apex court bench headed by Chief Justice Dipak Misra said the civil suit has to be decided on the basis of evidence and the previous verdict has no relevance on it.

Justice Ashok Bhushan, who read out the judgement for himself and the CJI, said it has to find out the context in which the five-judge had delivered the 1994 judgement.
Justice S Abdul Nazeer disagreed with the two judges and said whether mosque is integral to Islam has to be decided considering belief of religion and it requires detailed consideration.
He referred to the recent Supreme Court order on female genital mutilation and said the present matter be heard by larger bench.
The apex court said now the civil suit on land dispute will be heard by a newly constituted three-judge bench on October 29 as Justice Misra will retire on October 2 as the CJI.
The issue whether mosque is integral to Islam had cropped up when he three-judge bench headed by CJI Misra was hearing the batch of appeals filed against the Allahabad High Court's 2010 verdict by which the disputed land on the Ram Janmabhoomi-Babri Masjid area was divided in three parts.
A three-judge bench of the high court, in a 2:1 majority ruling, had ordered that the 2.77 acres of land be partitioned equally among three parties -- the Sunni Waqf Board, the Nirmohi Akhara and Ram Lalla.

Rapid growth of the shadow banking sector may endanger India's growth story

Manzoor Ahmad lost his job as an electrician and is struggling to make ends meet after a crucial road tunnel project shut down in Srinagar, the summer capital of Jammu and Kashmir state in the north.
Construction of the Z-Morh tunnel came to a halt two months ago after Infrastructure Leasing & Financial Services (IL&FS), one of India's top infrastructure funding companies which was helping build the project, stopped paying contractors in the face of a severe cash crunch.

"I have no work since work on the project was stopped in July," said Ahmad, 34, who was earning about Rs 30,000 ($413) a month.
Hundreds of other people working on the project are also out of a job because of non-payments by IL&FS. The company has also defaulted on its debt obligations, roiling Indian markets and sparking worries of a credit crunch in the shadow financing sector.
The company's defaults have highlighted the risk of a sharp growth slowdown in the world's fastest growing major economy, as lenders pare their exposure to the shadow banking space, or what are called non-banking finance companies (NBFCs) in India.
Shadow banks have played an outsized role in lending growth in India in the last two years, and the sector's loan books have grown at more than double the pace of Indian banks, that are currently saddled with about $150 billion of stressed assets.
"Raising money will become increasingly difficult for NBFCs and that will push up the cost of borrowing for these companies and projects will slow down eventually, leading to a broader slowdown in the economy than is currently priced in," said Ashish Vaidya, executive director and head of trading at DBS Bank in Mumbai.
A fall in economic growth would be a blow to Prime Minister Narendra Modi and the ruling Bharatiya Janata Party, which is already under pressure from protests over rising fuel costs, as they prepare for key state elections in late 2018 and a national election due to be held by next May.
RISING RATES
The stress is evident in short-term interest rates as the Reserve Bank of India's dollar sales to stem the rupee's fall have sucked up rupee liquidity and raised borrowing costs.
One-year commercial paper has risen by 80 basis points to 9.30 per cent since August and the one-year sovereign treasury bill rate is up 60 bps to 7.73 per cent, while the one-year overnight indexed swap rate is at 7.50 per cent, indicating markets are pricing in a 100 basis points hike in the RBI's key repo rate going forward.
The RBI has raised its policy rate by 50 basis points this year to 6.50 per cent and most analysts expect it to raise rates for a third time next week to stem inflationary pressure due to the sharp fall in the rupee.
There are already signs that financing is suffering, and that could hit capital spending.
State-run Power Finance Co, Rural Electrification Corp and North Eastern Electric Power Corp have all scrapped debt issuance plans this month as interest rates have surged.
Higher rates and more risk-aversion among finance companies - especially when combined with rising fuel prices - could also undermine consumer spending with items such as gold jewellery already being hit in the second quarter.
While India posted robust 8.2 per cent growth in the April-June quarter driven by strong consumption demand, it could see growth drop below the RBI's projected 7.2 per cent rate for the fiscal year ending next March as credit conditions tighten, say analysts.
"NBFCs have been a much higher percentage of system credit growth over the last few years, so a slowdown will hurt macro growth and specifically consumption," UBS warned in a note on Tuesday.
IN THE SHADOWS
The NBFCs' loan books grew 21.2 per cent in the fiscal year ended March 2018. In comparison, bank loans grew 10.3 per cent over the same period.
Such rapid growth for the shadow banking sector is fraught with risk, say analysts, especially as many have raised funds via short-term commercial paper that needs to be rolled over.
According to a Credit Suisse note on Monday, 41 percent of borrowings of NBFCs are maturing in the next six months and "any liquidity pressures will only add to the refinancing risk of these instruments."
Credit Suisse analyst Ashish Gupta said that mutual funds now owned an estimated 60 percent of the overall NBFC commercial paper issuance, which could exacerbate pains as redemption pressures at funds could cause yields of NBFC debt to spike further.
To contain ripple effects and ensure financial stability, the RBI may have to open a separate lending window for mutual funds through banks to ease any cash pressures, according to a finance ministry official.
While the RBI assured markets on Thursday of providing durable liquidity, traders were concerned over the extent to which the liquidity deficit could go up to unless the central bank conducted frequent open market bond purchases.
Bond dealers expect the liquidity deficit - the extent to which banks need to borrow from the central bank to fund their own lending - to rise to as much as Rs 3 trillion by March from 1.5 trillion rupees right now, pushing rates higher.
"The RBI should try to cool down interest rates by proactively managing liquidity conditions," said the head of a debt mutual fund who asked not to be identified because of the sensitivity of the comment. "Unless this anomaly is corrected investors will keep panicking and purging NBFC holdings."

Warren Buffett's Berkshire Hathaway closes $300 million investment in Paytm

One97 Communications, the parent entity of India’s largest digital payments firm, Paytm, has received $300 million (Rs 21.79 billion) in fresh funding from Berkshire Hathaway Inc. The deal is the Warren Buffett-led firm’s first investment in the country.
According to regulatory filings sourced from Paper.vc, One97 Communications issued 1.7 million shares to BH International Holdings on September 27. Post the investment, Berkshire Hathaway will have around 2.9 per cent holding in the Indian firm.

Paytm’s value post the investment will stand at Rs 731 billion ($10 billion).
Earlier this month, Berkshire Hathaway had confirmed it was investing in Paytm, but clarified that Buffett himself wasn't involved in making the deal. The investment is yet to be officially announced by either Berkshire Hathaway or Paytm.
“We feel both excited and humbled by this endorsement. Berkshire’s experience in financial services, and long-term investment horizon is going to be a huge advantage in Paytm’s journey of bringing 500 million Indians to the mainstream economy through financial inclusion,” Paytm boss Vijay Shekhar Sharma had said in a statement soon after.
The investment comes at a time when Paytm is going up against global giants Google and Facebook-owned WhatsApp. Both the US giants have either launched or are in the process of launching their digital payment products built on top of India’s indigenous payment system UPI.
Google Pay (previously Google Tez) is already one among the most used UPI payment apps in the country. In August, the Mountain View company said its payment app had been downloaded over 50 million times in India. WhatsApp continues to await the go-ahead from RBI to launch its UPI service beyond the one million beta users who already have access to it.
The Facebook-owned instant messaging app has over 200 million monthly active users in India already, and experts say with such a large user base, it could really disrupt other large players in the market. Sharma has been quite vocal in his opposition to these global players, even calling Facebook the most evil company in the world.
The other large backers of Paytm include China’s e-commerce giant Alibaba and Japan’s Softbank, both of which have pumped in billions into the digital payments firm. Alibaba has also made a separate investment into Paytm Mall, which is the e-commerce subsidiary of the Sharma-led company.

SC upholds Aadhaar validity, but with modifications: Full case timeline

The following is the chronology of events leading up to the Supreme Court on Wednesday declaring the Centre's flagship Aadhaar scheme as constitutionally valid although it struck down some provisions including the linking of the biometric ID with bank accounts, mobile phones and school admissions:
* Jan 2009: Planning Commission notification on UIDAI.
* 2010-2011: National Identification Authority of India Bill, 2010 introduced.
* Nov 2012: Retired Justice K S Puttaswamy and others file PILs in SC challenging validity of Aadhaar.
* Nov 2013: SC orders all states and Union Territories be impleaded as respondents.
* Mar 3, 2016: Aadhaar Bill, 2016 introduced in Lok Sabha; later passed as Money Bill.
* May 2017: Former Union minister and Congress leader Jairam Ramesh moves SC challenging the Centre's decision to treat Aadhaar Bill as a Money Bill.

ALSO READ: Mammoth task to audit, erase Aadhaar data with private firms: Experts
* Aug 24, 2017: SC nine-judge bench rules that right to privacy is a fundamental right.
* Dec 15: SC extends deadline for mandatory linking of Aadhaar with various services and welfare schemes till March 31, 2018.
* Jan 17, 2018: SC five-judge bench begins hearing Aadhaar case.
* Jan 25: SC asks Chhattisgarh HC to modify in 10 days its order directing all trial courts in the state to mandatorily accept copies of Aadhaar card for releasing an accused on bail.
ALSO READ: SC verdict on Aadhaar 'a good judgement', gives relief to citizens: Experts
* Feb 19: Delhi BJP leader Ashwini Kumar Upadhyay seeks direction to EC to take appropriate steps to implement an 'Aadhaar based election voting system'.
* Feb 21: SC says the alleged defect that citizens' biometric details under the Aadhaar scheme were being collected without any law, could be cured by subsequently bringing a statute.
* Mar 7: SC says Aadhaar number not mandatory for enrolment of students in all India exams.
* Mar 13: SC extends March 31 deadline of Aadhaar linking till it gives its order.
* Mar 22: UIDAI CEO says breaking the Aadhaar encryption may take "more than the age of the universe for the fastest computer on earth".
ALSO READ: Over 210.8 million PAN cards linked with Aadhaar till now, reveals data
* Mar 28: Social activist Reshma Prasad seeks direction to the Centre to create a separate third gender category option on PAN cards for transgenders.
* Apr 3: Centre tells SC Aadhaar law is just, fair & reasonable.
* Apr 17: SC raises concerns that there is a threat of Aadhaar data misuse.
* Apr 25: SC questions Centre on mandatory seeding of Aadhaar with mobile.
* May 10: SC reserves verdict.
ALSO READ: SC declares Aadhaar constitutionally valid, strikes down some provisions
* Sep 26: SC upholds constitutional validity of Aadhaar but strikes down certain provisions including its linking with bank accounts, mobile phones and school admissions.

Mammoth task to audit, erase Aadhaar data with private firms: Experts

Terming the Supreme Court verdict on Aadhaar a breath of fresh air for Indian citizens, experts on Wednesday said a completely new regime has to be put in place to protect the Aadhaar data that is lying with private companies.
Stating that private entities or individuals cannot avail Aadhaar data to provide consumer services, the apex court struck down Section 57 of the Aadhaar Act which allowed sharing of data with private entities.

It means that telecom companies, e-commerce firms and private banks cannot ask for biometric and other data from consumers to provide their services.
"The Aadhaar verdict is a huge sigh of relief for citizens. The humongous task now is to ensure that the data that is already with private companies is not misused or sold," Pavan Duggal, the nation's leading cyber law expert, told IANS.
"The data now needs to be dismantled but the onus is to make sure companies do not make copies of the data and use it to monetise their operations. The big question is which agency will audit this humongous task," added Duggal, also a leading Supreme Court lawyer.
The apex court also said that Aadhaar data can't be shared with security agencies in the name of upholding national security and individuals too can complain about the theft of their Aadhaar data.
"Private companies played a big gamble of integrating Aaddhar data with their systems wherein they spent a lot of money. The whole exercise is now futile and the country now needs a fresh Aadhaar ecosystem," Duggal noted.
The Unique Identification Authority of India (UIDAI), said Duggal, had already lodged more than 50 FIRs against private companies for Aadhaar data breach.
"Today's judgment as read out in court signals massive changes in the Aadhaar project and the Act. The legitimacy of its stated purposes is destroyed. Even the majority signals significant concern by reading down portions," tweeted New Delhi-based lawyer Apar Gupta.
ALSO READ: Here's how to delink Aadhaar from digital wallet, bank: Step-by-step guide
Although experts are yet to read the verdict in fine print, they said the Supreme Court's directive to Centre to bring a robust data protection law is the need of the hour.
"The Aadhaar data is saved in data centres outside the boundaries and law of our country. There is an urgent need for addressing newly emerging legal and cybersecurity challenges concerning Aadhaar ecosystem on an urgent basis," Duggal said.
The Supreme Court, in a landmark judgment last year, declared privacy a fundamental right. This set the government in motion to take steps to bring a new data protection legislation for the country.
ALSO READ: SC declares Aadhaar constitutionally valid, strikes down some provisions
The Justice B.N. Srikrishna Committee submitted the Personal Data Protection Bill 2018 in July, suggesting amendments to the Aadhaar Act to provide for imposition of penalties on data fiduciaries and compensations to data principals for violations of the data protection law.
The 213-page report suggested amendments to the Aadhaar Act from a data protection perspective.
According to Duggal, "not just cosmetic changes, there is an urgent need for addressing newly emerging legal and cyber security challenges concerning Aadhaar ecosystem on an urgent basis".
Supratim Chakraborty, Associate Partner at law firm Khaitan & Co, said the verdict that private parties cannot have access to individuals' data was a double-edged thing.
"From a socialistic perspective and individualistic perspective, you need to have proper safeguards as to how your information is being used by a private party.
"However, from a business perspective, it could increase their expenses if they need to collect too much information one by one from an individual. It compels us to ponder whether there is a correct way to do business while protecting the privacy of users," Chakraborty told IANS.
In Europe, as part of the European Union's General Data Protection Regulation (GDPR) that came into force from May 25, EU citizens at any point may object to an organisation's handling of their personal data.
The regulation specifically names "direct marketing and profiling" as personal data uses to which individuals may object.
According to Duggal, India should not cut-paste any other country's law and must strive for data localisation.
"There is a need for more comprehensive legal frameworks to protect and preserve data and privacy of individual Aadhaar account holders in specific and the Aadhaar ecosystem stakeholders in general," Duggal noted.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

After SC verdict, private firms wanting to still use Aadhaar look to govt

Even as the Supreme Court (SC) disallowed the use of Aadhaar authentication services by the private sector, companies in the fintech business have voiced their concern on the order.
Companies argue that without Aadhaar authentication, their businesses will get disrupted and the government needs to think about a legislation that reinstates their ability to ask for Aadhaar.
In the majority judgement penned by Justice A K Sikri on his own behalf and on behalf of Chief Justice of India (CJI) Dipak Misra and Justice A M Khanwilkar, the SC said that Section 57 of the Aadhaar Act, which allows private companies to use Aadhaar authentication services, is unconstitutional as it fails the test of "proportionality doctrine".
This implies that lending companies, mobile wallets and other private companies making use of Aadhaar e-KYC to onboard customers can't access authentication facilities anymore.
ALSO READ: SC declares Aadhaar constitutionally valid, strikes down some provisions
Experts said that this will be a big blow to the ecosystem as e-KYC cuts down costs as well as the time required to bring new customers onboard.
"Though the verdict is not affecting us, we believe that this will be a regressive move for fintech companies as they will eventually move to the traditional mode of verifying individuals and thereby the turnaround time for processing the loan will increase to a considerable extent," said Bhavin Patel, co-founder and CEO of LenDenClub, a peer-to-peer lender.

ALSO READ: Mammoth task to audit, erase Aadhaar data with private firms: Experts
In the same vein, Omidyar Network, which backs India Stack and funds start-ups and research on Aadhaar, said that private sector companies will now look up to the Parliament to pass a legislation that clarifies the restrictions and possibilities of using Aadhaar.
"The direction by the court on private sector use cases will now require Parliament to pass laws that allow for specific uses. Such parliamentary oversight on private sector uses is warranted and desirable," said C V Madhukar, global digital identity initiative lead at Omidyar Network.
Madhukar said that the judgement is welcome as it reinforces the faith in Aadhaar while taking care of exclusion cases. But, he said that the private companies will need to evolve their business models as the verdict raises questions on the use of e-KYC.
"The judgment raises an immediate question on the continued use of e-KYC for financial inclusion. As shown in the State of Aadhaar report, Aadhaar-based e-KYC has led to greater inclusion for underserved segments, including opening of millions of bank accounts," he added.
ALSO READ: SC verdict on Aadhaar 'a good judgement', gives relief to citizens: Experts
Meanwhile, Finance Minister Arun Jaitley also held a briefing in Delhi where he welcomed the judgement and claimed that use of Aadhaar by private companies needs legislative backing.
"Section 57 (of the Aadhaar Act that has been struck down by the Supreme Court) says that there can be special enabling power to allow other entities or body corporate (to use Aadhaar). I can give you my information (about the judgement). That is not permissible unless it is backed up by law. That seems to be the spirit of the judgement," he said.
Adding that a careful reading of the judgement is required, Jaitley said that the ban on the private sector from using Aadhaar could be "temporary".
"I still have to do a detailed reading of the judgement. Therefore, do not assume the prohibited areas are perpetually prohibited, they could be procedurally prohibited or they could be prohibited as such," he said.
ALSO READ: Over 210.8 million PAN cards linked with Aadhaar till now, reveals data
Meanwhile, legal experts claimed that introducing a law to bypass the SC directive might not be possible given the court's stern stance.
"As per the judgment, Section 57 fails the proportionality doctrine making the invasion of a citizen's privacy by the private players excessive. Hence, it will be difficult to bring it back through another legislation," said Prasanth Sugathan, legal director, Software Freedom Law Centre, India.
In its judgement, the court even said that it will look into the legislation for allowing the private sector to use Aadhaar, if it ever comes.
"It [Aadhaar] can be used for establishing the identity of an individual 'for any purpose'. We read down this provision [Section 57] to mean that such a purpose has to be backed by law. Further, whenever any such 'law' is made, it would be subject to judicial scrutiny," Justice Sikri wrote in his judgement.

Govt hikes import tariffs on 19 items; ACs, refrigerators, footwear hit

The government Wednesday raised import duties on 19 items, including jet fuel and air conditioners, as it looks to check the widening current account deficit resulting from high crude oil prices and the rupee dipping to a historic low.
The enhanced duty rates, which will make these imported goods expensive, will come into effect from midnight of September 26-27, said a government statement.

"The total value of imports of these items in the year 2017-18 was about Rs 86,000 crore," the statement said.
"The central government has taken tariff measures, by way of increase in the basic customs duty, to curb import of certain imported items. These changes aim at narrowing the current account deficit (CAD). In all the customs duty has been increased on 19 items," it said.
The import duty on air conditioners, household refrigerators and washing machines (less than 10 kg) doubled to 20 per cent. The basic customs duty on compressors, speakers and footwears raised to 10 per cent, 15 per cent and 25 per cent respectively.
The duty on radial car tyres raised from 10 per cent to 15 per cent while for cut and polished diamonds, semi-processed diamonds, lab grown diamonds, coloured gem stones the import hiked from 5 per cent to 7.5 per cent.
The articles of jewellery, goldsmith and silver wares will now attract a duty of 20 per cent, up from 15 per cent earlier.
Import of bath wares, packing material, tableware, kitchenware and office stationary items, decorative sheets, beads and bangles, trunk, suitcases, and travel bags will now attract basic customs duty of 15 per cent as against 10 per cent earlier.
Besides, the government has also announced an import duty of 5 per cent on aviation turbine fuel (ATF). It was nil earlier.
The announcement follows a decision taken by the government on September 14 that the centre would impose curbs on import of non-essential items to contain the widening CAD and check the rupee fall. The CAD widened to 2.4 per cent of the GDP in the first quarter of 2018-19.
Niti Aayog Vice chairman Rajiv Kumar, "Some actions had to be taken. In 2013 if you remember, same sort of thing had been done. These are steps to assure industrialists and others that the government is ready to take steps to get the external account into balance and control the CAD. But the key is to increase the exports."
"To address the issue of expanding CAD, the government will take necessary steps to cut down non-essential imports and increase exports. The commodities of which imports will be cut down will be decided after consultations with concerned ministries and will be WTO-compliant," Finance Minister Arun Jaitley had said after a meeting chaired by Prime Minister Narendra Modi to review the economic situation.
Large trade deficit and rupee decline against the US dollar are putting pressure on the CAD, and these steps are likely to have a positive impact on the external sector.
The rupee touched an all-time closing low of 72.91 against the dollar on September 12. Today it closed at 72.6 against the US dollar.
The domestic currency has declined by around 6 per cent since August. Petrol and diesel prices have also touched record highs recently.
TariffTariff Photo: PIB

India to cut Iran oil import in Nov; Tehran may lose another major customer

India is not planning to buy any crude oil from Iran in November, raising the prospect that Tehran will lose another major customer as U.S. sanctions hit.
Indian Oil Corp. and Bharat Petroleum Corp. haven’t asked for any Iranian cargoes for loading in November, according to officials at the companies. Nayara Energy also doesn’t plan any purchases, said an industry executive. Mangalore Refinery and Petrochemicals Ltd. hasn’t made any nominations for that month, but may do so later, a company official said.

Final decisions on purchases aren’t due until early October, so the refiners could still change their minds. The company officials and industry executive asked not to be named citing internal policies.
The rapid drop in Iranian exports has helped to push Brent crude, the global benchmark, to a four-year high above $80 a barrel. Further output losses could push prices even higher as refiners urgently seek replacement barrels elsewhere. Around the world, only Saudi Arabia and, to a lesser extent, United Arab Emirates and Russia, have the capacity to pump more.
Brent hit an intraday high of $82.55 a barrel on Tuesday, up 23 percent this year, just after U.S. President Donald Trump railed against OPEC and demanded the cartel lower oil prices.
Major Buyer
India is the second-largest buyer of Iranian oil, having imported an average of 577,000 barrels a day this year, or about 27 percent of the Middle Eastern country’s exports, according to Bloomberg tanker tracking data. With South Korea, Japan and European nations also cutting imports to zero, the loss of the Indian refiners, even if temporarily, is a major blow for the Islamic republic.
At the same time, the U.S. sanctions that are due to go into effect in early November are creating a major gap in the global oil market just as Brent crude hits a four-year high above $80 a barrel. Mercuria Energy Group Ltd. and Trafigura Group, among the world’s biggest trading houses, are predicting the loss of Iran’s supply will boost prices to $100 a barrel for the first time since 2014.
That risk has been echoed by some of the world’s biggest oil companies. BP Plc Chief Executive Officer Bob Dudley sees the sanctions on the OPEC nation having a bigger impact on the market this time than the previous round of restrictions six years ago.
Harder Stance
U.S. President Donald Trump’s administration is taking a harder stance. It wants all oil imports from Iran to end by November, and it’s unclear if any waivers will be granted. In previous sanctions under Barack Obama, the government had allowed nations to continue purchases at reduced levels.
The tougher attitude is already showing in Iranian barrels vanishing from the market. South Korea became the first of Iran’s top-three oil customers to heed the U.S. diktat by refraining from any purchases last month. Japanese refiners have also temporarily halted loadings.
India and China had held out hope for Iran. It was only about four months ago that India’s foreign minister said that the country won’t adhere to unilateral restrictions and will continue buying Iranian crude. China also made similar comments and was said to have rejected an American request to cut imports.
When Trump in May announced plans to reimpose sanctions on Iran’s oil exports, the market estimated a cut of about 300,000 to 700,000 barrels a day, Trafigura’s co-head of oil trading Ben Luckock said this week. However, the consensus has now moved to as much as 1.5 million barrels as the U.S. is “incredibly serious” about its measures, he said.

Centre approves Rs 45-billion financial package for sugar industry for FY19

The government on Wednesday approved a Rs 45 billion package for the sugar industry that includes over two-fold jump in production assistance to cane growers and transport subsidy to mills for export up to 5 million tonnes in the marketing year 2018-19, sources said.
The Cabinet Committee on Economic Affairs (CCEA) approved the food ministry's proposal that seeks to address the surplus domestic stock of sugar and help mills in clearing huge cane arrears of around Rs 130 billion.

With assembly elections due in some states and upcoming general polls in mid-2019, the government wants to address cane growers payment issue.
This is the second financial package to bail out the sugar industry after Rs 85 billion in June. The industry is facing a glut-like situation because of record production of 32 million tonnes (MT) in the 2017-18 marketing year (October-September), resulting in a closing stock of 10 MT at the end of this month.
Under its 'Comprehensive policy to deal with excess sugar production in the country', the ministry has recommended offsetting cost of sugarcane to sugar mills by increasing the production assistance paid to growers at Rs 13.88 per quintal for the 2018-19 marketing year from Rs 5.50 per quintal for this year.
ALSO READ: Yogi sets Nov 30 deadline for sugar mills to settle dues of Rs 86 bn
With low global prices, the ministry has suggested helping mills to export 5 million tonnes of sugar under the Minimum Indicative Export Quota (MIEQ) during 2018-19 by compensating expenses towards internal transport, freight, handling and other charges.
Sources said the ministry has proposed a transport subsidy of Rs 1,000 per tonne for the mills located within 100 km from ports, Rs 2,500 per tonne for a mill located beyond 100 km from the port in coastal states and Rs 3,000 tonnes per tonne for mill located in other than coastal states.
Like in the current year, the production assistance will directly be credited into the sugarcane farmers' account on behalf of the mills as part of the government's measures to clear more than Rs 135 billion in arrears sugar mills have towards farmers.
ALSO READ: CCI fines wipe out a third of sugar stocks' fortnightly gain in just 3 days
Sources has earlier said the government will have to bear about Rs 45 billion on account of these measures to help sugar mills and cane farmers.
These steps will enable mills to boost sugar exports and clear cane arrears, which currently stand at Rs 135.67 billion. Mills in Uttar Pradesh owe the maximum at Rs 98.17 billion to cane farmers.
India's sugar output is set to increase further to 35 MT in the next marketing year from 32 MT in 2017-18. The annual domestic demand stands at 26 MT.
The government has taken a slew of measures to bail out sugar mills as well as cane farmers in the last one year.
First, it doubled the import duty on sugar to 100 per cent and then scrapped the export duty on it. It also made it compulsory for millers to export two million tonnes of sugar even as global prices were low.
In June, the government had announced a Rs 85 billion package for the industry, which included soft loans of Rs 44.4 billion to mills for creating ethanol capacity. It will bear an interest subvention of Rs 13.31 billion for this.
ALSO READ: Too sweet to handle: Yogi's statement on sugar is wrong at many levels
The Centre had also announced assistance of Rs 5.50 per quintal of cane crushed, amounting to Rs 15.40 billion to mills. Around Rs 12 billion was allocated for the creation of 3 MT buffer stock of sugar. The minimum selling price of the sweetener has been fixed at Rs 29 per kg.
Early this month, the government had approved an over 25 per cent hike in the price of ethanol produced directly from sugarcane juice for blending in petrol, in a bid to cut surplus sugar production and reduce oil imports.
The CCEA raised the procurement price of ethanol derived from 100 per cent sugarcane juice to Rs 59.13 per litre from the current rate of Rs 47.13.
The price for ethanol produced from B-heavy molasses (also called intermediary molasses) was hiked to Rs 52.43 a litre from the current Rs 47.13, but that for ethanol produced from C-heavy molasses was reduced marginally to Rs 43.46 from Rs 43.70.

MARKETS LIVE: Indices trim losses, Nifty tests 11,050; FMCG, IT stocks fall

The benchmark indices are trading slightly lower on Wednesday ahead of the September F&O contracts expiry due on Thursday.
Among sectoral indices, the Nifty FMCG index has slipped around1.5 per cent led by fall in ITC and Hindustan Unilever. The Nifty IT index, on the other hand, has fallen nearly 1.7 per cent weighed by Infosys and Tata Consultancy Services (TCS).

In key individual stocks, YES Bank is trading over 2 per cent higher at Rs 225.15 on the BSE. DHFL was up 1 per cent at Rs 303.75.
Investors will keenly watch US Fed meet outcome due later in the day for fresh cues in the markets.
Global Markets
Asian shares pulled ahead on Wednesday, as Chinese markets extended their recovery to hit eight-week highs on receding fears about the trade war as well as hopes China's weighting in the global benchmark will be increased.

MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.5 per cent. Shanghai shares rose 1.55 per cent. Japan's Nikkei climbed more than 0.3 per cent, touching its highest since late January.
(with Reuters inputs)
CATCH ALL THE LIVE UPDATES
02:15 PM
United Breweries Ltd spurts 0.9%, up for five straight sessions
The stock is quoting at Rs 1397.55, up 0.9% on the day on the NSE. United Breweries Ltd is up 69.56% in last one year as compared to a 13.32% gain in NIFTY and a 20.98% gain in the Nifty FMCG. United Breweries Ltd rose for a fifth straight session today. READ MORE
02:01 PM
Market Check
Index Current Pt. Change % Change

S&P BSE SENSEX 36,456.42 -195.64 -0.53

S&P BSE SENSEX 50 11,519.76 -46.13 -0.40

S&P BSE SENSEX Next 50 32,747.59 +148.12 +0.45

S&P BSE 100 11,275.22 -30.77 -0.27

S&P BSE Bharat 22 Index 3,513.63 -19.43 -0.55
(Source: BSE)
01:46 PM
Hindustan Zinc well placed on rising volumes, supply situation
Though the broader markets have been under pressure, Hindustan Zinc continues to gain and has bounced back 13.8 per cent from its July lows. While trade war concerns have led to volatility in base metal prices, what offers comfort is the outlook for zinc given the supply shortages.

Further, while it posted softer volumes in the June quarter, there has been a recovery and analysts expect a better second half. READ MORE
01:36 PM
Cabinet okays Rs 4,500-cr package to sugar industry
The government Wednesday approved a Rs 4,500 crore package for the sugar industry that includes over two-fold jump in production assistance to cane growers and transport subsidy to mills for export up to 5 million tonnes in the marketing year 2018-19, sources said.

The Cabinet Committee on Economic Affairs (CCEA) approved the food ministry's proposal that seeks to address the surplus domestic stock of sugar and help mills in clearing huge cane arrears of around Rs 13,000 crore. READ MORE
01:25 PM
NEWS ALERT Cabinet approves national digital communication policy (telecom policy)
Telecom stocks in green:
COMPANY LATEST PREV CLOSE GAIN() GAIN(%)
M T N L 14.85 14.10 0.75 5.32
REL. COMM. 11.80 11.55 0.25 2.16
VODAFONE IDEA 41.25 40.50 0.75 1.85
NETTLINX 72.50 71.25 1.25 1.75
TEJAS NETWORKS 272.40 268.25 4.15 1.55
01:16 PM
NEWS ALERT Cabinet approves package for sugar industry
Sugar stocks react:
COMPANY LATEST PREV CLOSE GAIN() GAIN(%)
THIRU AROOR. SU. 31.55 29.55 2.00 6.77
GAYATRI SUGARS 4.63 4.41 0.22 4.99
RIGA SUGAR 8.09 7.71 0.38 4.93
KCP SUGAR &INDS. 24.70 23.55 1.15 4.88
UGAR SUGAR WORKS 16.13 15.47 0.66 4.27
Click here for more
01:07 PM
TOP TAKEAWAYS All you wanted to know about the Aadhar judgement Click here for more
01:05 PM
MID-CAP INDEX OUTPERFORMS Top gainers in the mid-cap segment
COMPANY LATEST CHG(RS) CHG(%) FREE FLOAT
MKT CAP
(RS CR) WEIGHT IN
INDEX (%)
GODREJ PROPERT. 599.55 25.10 4.37 3987.18 0.47
HONEYWELL AUTO 21718.40 776.40 3.71 4799.77 0.56
OBEROI REALTY 419.05 11.90 2.92 4875.73 0.58
M & M FIN. SERV. 427.60 12.10 2.91 12943.35 1.53
IIFL HOLDINGS 569.50 15.95 2.88 12900.63 1.53
GLENMARK PHARMA. 652.85 17.00 2.67 9764.42 1.16
Click here for the full list
01:03 PM
TOP LOSERS IN TRADE TODAY
COMPANY PRICE() CHG() CHG(%) VOLUME
KPIT TECH. 247.35 -19.40 -7.27 737172
SADBHAV ENGG. 231.25 -17.95 -7.20 10520
BOMBAY DYEING 186.20 -9.80 -5.00 6191
8K MILES 213.00 -11.20 -5.00 2777
INDIABULLS VENT. 594.55 -31.25 -4.99 9005
» More on Top Losers
01:01 PM
Prabhudas Lilladher on Aavas Financiers IPO
High capital adequacy (61%) will not only depress RoE in near term (current RoE at 11%) but elevated valuations would require high growth to improve ratios and justify valuations. Market conditions are challenging with high interest rates, bond yields volatility and anemic property market. Although technological driven processes (data analytics for onboarding customers, risk management, collection framework), regional expansion and stepping-up leverage signal bettering operational efficiencies in long term, valuations leave little scope for a negative surprise. AVOID.
01:00 PM
Edelweiss on JSW Energy
We met JSW Energy (JSWE) JMD & CEO Mr. Prashant Jain to size up the evolving landscape in the power sector and the company’s new business initiatives.
Key takeaways: 1) JSWE is likely to benefit from consolidation in the thermal power sector given its balance sheet (BS) strength. 2) Higher merchant prices due to favourable power demand-supply dynamics and rising fuel cost would force discoms to sign PPAs. 3) Management is long-term optimistic (but sees near-term pain) on renewables owing to the shift towards cleaner energy and expects tariffs to settle within INR3.25–4.0 in the medium term. 4) Management is confident of a successful foray into the electric vehicle (EV) business given opportunity size, structural shift in mobility and potential commercial parity over the next five years.
We like JSWE’s strong balance sheet, which can spur growth once demand revives. Our cautious stance stems from its expansion into a relatively unrelated space. Maintain ‘HOLD/SP’.
01:00 PM
Sharekhan on Marico
We expect FY2019 and FY2020 earnings estimates to grow by 3.7% and 2.5%, respectively. The gradual improvement in domestic volume growth and correction in copra prices would aid Marico to achieve strong earnings growth (22% CAGR) over the next two years. Marico is currently trading at 35x its FY2020 earnings, which is at a discount to some of the large FMCG stocks.
Moreover, rupee depreciation against USD will have less impact on Marico’s earnings as the company has natural hedge with foreign currency earnings being higher than expenses. Thus, stable valuations and correcting copra prices make Marico as one of our top picks in the FMCG space. We maintain our Buy recommendation on the stock with an upgraded price target (PT) of Rs. 385 (in-line with increased earnings estimates).
12:58 PM
FOMC preview
Post European market close will see the outcome of the FOMC’s latest policy meeting. This will include a press conference from Powell and a fresh summary of economic projections (the latter of which of course includes the dot plot).
It is expected that the Fed will announce a 25bp hike to the target range for the Fed Funds Rate (FFR). Despite the fact that the effective FFR is now trading only 7bp below the upper band of its target range (which means that it is 2bp below the IOER rate), it is still expected the IOER will be increased by the full 25bp (rather than, for example, only increasing it by 20bp).
(Source: Rabobank International report)
12:47 PM
KEI Industries gets revision in credit ratings
KEI Industries announced that CARE Ratings (CARE) has upgraded the rating assigned to Long Term Bank Facilities availed by the Company from CARE A-; Outlook: Positive Single A Minus] to CARE A; Stable [Single A; Outlook Stable]. Further, CARE has upgraded the rating assigned to Short Term Bank Facilities availed by the Company from CARE A2+ [A Two Plus] to CARE A1 [A One]. READ MORE
12:29 PM
Anand Rathi Wealth Services files Rs 4.25-bn IPO papers with Sebi
Financial services firm Anand Rathi Wealth Services has filed draft papers with markets regulator Sebi to raise an estimated Rs 4.25 billion through an initial public offering (IPO).

The IPO comprises fresh issue of equity shares by Anand Rathi Wealth Services aggregating up to Rs 1.25 billion and an offer for sale of up to Rs 3 billion by the promoter Anand Rathi Financial Services, according to the draft red herring prospectus (DRHP) filed with Sebi. READ HERE
12:15 PM
US-China trade war dims Asia's 2019 growth outlook says Asian Development Bank
Developing Asia could grow more slowly than previously thought next year as the US-China trade war inflicts damage on the region's export-reliant economies, the Asian Development Bank (ADB) said on Wednesday.

Tightening global liquidity could also weigh on business activity by pushing up borrowing costs, while capital outflows are also a risk. READ MORE
12:03 PM
Market Check
Index Current Pt. Change % Change

S&P BSE SENSEX 36,456.34 -195.72 -0.53

S&P BSE SENSEX 50 11,515.74 -50.15 -0.43

S&P BSE SENSEX Next 50 32,521.40 -78.07 -0.24

S&P BSE 100 11,260.15 -45.84 -0.41

S&P BSE Bharat 22 Index 3,509.37 -23.69 -0.67
(Source: BSE)
11:52 AM
After IL&FS crisis, suspicion running deep in bond dealers' minds
Public sector North Eastern Electric Power Corp Ltd (NEEPCO) on Monday called for bids to raise Rs 3 billion in seven-year bonds through the electronic bidding platform. It received bids worth Rs 135 million, asking for a coupon of 9.25 per cent. Last week, government-owned Rural Electrification Corp (REC) wanted to raise three-year 13-day bonds worth Rs 5 billion with a greenshoe option of another Rs 20 billion. READ MORE
11:40 AM
NEWS ALERT SC upholds constitutional validity of Aadhaar
11:31 AM
Why the IL&FS crisis is spooking debt and equity markets in India
What is the genesis of the crisis at IL&FS? Focused on capital expenditure (capex) rich sectors, Infrastructure Leasing & Financial Services (IL&FS) has used the debt route to raise substantial capital in the past. The current problems started in August when IL&FS defaulted on Rs 4.5 billion worth of inter-corporate deposits (ICDs) to the Small Industries Development Bank of India (SIDBI). READ MORE
11:13 AM
Nomura on financial sector
liquidity scare and related correction in financial stocks was driven by overall tightening liquidity conditions, initial contagion of the IL&FS debt downgrade and risk aversion behaviour of debt investors. We expect liquidity conditions to remain tight in the near term and, given negative news flow relating to IL&FS, risk aversion may also continue, but we believe investors need to differentiate between liability franchises in this environment.
11:11 AM
Jefferies on air-conditioning sector
The engineering air-conditioner segment (MEP) is back on the growth path after eight years of weak demand. Volatile weather has hit the residential AC segment in 1HFY19. We believe prospects for both industries are strong in the medium term, with MEP also showing near-term strength. We upgrade Blue Star to Buy, as the share price now reflects margin impact of water purifier investment. We remain positive on Voltas and believe weakness is a buying opportunity
11:07 AM
F&O watch Rollover highlights
· The Nifty Sep expiry rollover is at 29.9% on Tuesday compared to 36.94% on same day of previous expiry.

· The Banknifty Sep expiry rollover is at 27.4% on Tuesday compared to 31.63% on same day of previous expiry.

· The Market wide Sep expiry rollover is at 42.6% on Tuesday as compared to 48.38% on same day of previous expiry.

· The Nifty Sep rollover is lower than its Three months average of 33.24% and its six months average of 32.99%.

· The Banknifty Sep rollover is lower than its Three months average of 27.77% and its six months average of 27.99%.

· The market wide rollover is lower than with its three months average of 45.26% and six months average of 41.63%.
(Source: Nirmal Bang)
11:01 AM
Cryptocurrencies are in no hurry to gain back lost ground: Here's why
Cryptocurrencies like Bitcoin have lost over half their value so far in 2018, and more than that since late 2017. These virtual currencies have crashed before, but this time they seem in no hurry to gain back lost ground, largely because recent evidence has revealed problems with the new technology. READ MORE
10:51 AM
NSEL scam: SFIO asks for delisting of 63 Moons Technologies from bourses

The Serious Fraud Investigation Office (SFIO) has recommended this in a report to the Union ministry of corproate affairs on the scam in the erstwhile National Spot Exchange (NSEL), hit by a mssive payment default scam some years earlier. Also, that the company’s directors not be allowed to access the markets and raise funds. READ MORE
10:42 AM
JUST NOW
Bank of Baroda to consider merger proposal on Sept 29: News reports
10:39 AM
These stocks hit 52-week highs in today's trade
COMPANY LATEST 52 WK HIGH PREV HIGH PREV DATE VOLUME
APOLLO FINVEST 90.85 90.85 89.10 25-SEP-2018 1047
AUROMA COKE 16.24 16.24 15.93 25-SEP-2018 902
BAJAJ HEALTHCARE 450.00 450.00 441.00 30-MAY-2018 1600
BIOCON 709.00 718.35 708.25 25-SEP-2018 161573
DIVI'S LAB. 1414.75 1425.60 1407.00 19-SEP-2018 33721
Click here for the full list
10:33 AM
IL&FS crisis: Debt plan investors should thoroughly check fund's portfolio

The series of defaults by Infrastructure Leasing & Financial Services (IL&FS) has hurt debt funds. Worse, with funds like DSP Investment Managers selling the debt papers of Dewan Housing Finance, despite no apparent problem in the company, there is palpable fear among investors and debt-fund managers. READ MORE
10:16 AM
Biocon hits new high; stock zooms 109% in one year
Shares of Biocon hit a new high of Rs 718 per share, up 2% on Wednesday, extending their 6% rally on Tuesday on the BSE in an otherwise subdued market after the company said the inspection of its drug substance manufacturing site at Bengaluru campus by the US health regulator has concluded without any observations. READ MORE
10:01 AM
Market Check
Index Current Pt. Change % Change

S&P BSE SENSEX 36,695.83 +43.77 +0.12

S&P BSE SENSEX 50 11,593.53 +27.64 +0.24

S&P BSE SENSEX Next 50 32,777.59 +178.12 +0.55

S&P BSE 100 11,338.22 +32.23 +0.29

S&P BSE Bharat 22 Index 3,536.36 +3.30 +0.09
(Source: BSE)

SC agrees to live streaming, video recording of court proceedings

The Supreme Court Wednesday agreed to live-streaming and video recording of court proceedings.
The apex court said that necessary rules for balancing rights of public and protecting dignity of litigants will be placed soon.

"Sunlight is the best disinfectant", the bench said while allowing live streaming of court proceedings.
Live-streaming of court proceedings will effectuate the "public right to know" and bring in more transparency in judicial proceedings, the court said.
The verdict was passed on a batch of petitions, including those filed by senior advocate Indira Jaising, law student Snehil Tripathi and NGO 'Centre For Accountability and Systemic Change' on the issue.

Modi, Ambani jointly carried out surgical strike on defence forces: Rahul

Upping the ante on the Rafale issue, Congress president Rahul Gandhi Saturday alleged Prime Minister Narendra Modi and Anil Ambani jointly carried out a "surgical strike" on the defence forces.
His renewed attack on Modi came a day after a French media report quoted former French president Francois Hollande as purportedly saying that the Indian government proposed Ambani's Reliance Defence as the partner for Dassault Aviation in the Rs 580 million Rafale jet fighter deal and France did not have a choice.

"The PM and Anil Ambani jointly carried out ... SURGICAL STRIKE on the Indian Defence forces. Modi Ji you dishonoured the blood of our martyred soldiers. Shame on you. You betrayed India's soul (sic)," Gandhi tweeted.
Modi had announced the procurement of a batch of 36 Rafale jets after holding talks with then French President Hollande on April 10, 2015 in Paris.
The opposition party has been accusing the government of choosing Reliance Defence over state-run Hindustan Aeronautics Ltd to benefit the private firm though it did not have any experience in the aerospace sector.

Decision on H4 visa holders within 3 months: Trump admin tells US court

The Trump administration Saturday told a federal court that its decision to revoke work permits to H-4 visas holders, who are primarily spouses of H-1B foreign guest workers, is expected within the next three months.
The Department of Homeland Security (DHS) in its latest court filing Saturday told the US District Court in District of Columbia that it was "making a solid and swift progress in proposing to remove from its regulations certain H-4 spouses of H-1B nonimmigrants as a class of aliens eligible for employment authorisation".

The DHS said the new rule would be submitted to the Office of Management of Budget (OMB), White House, within three months.
Till then, the department urged the court, to keep in abeyance its decision on a lawsuit filed by Save Jobs USA, representing a group of US workers who claim that their jobs have been hit by such a policy of the government that was promulgated during the previous Obama administration.
The Trump administration has publicly said and also in its court filing that it wants to revoke work permits to H4 visa holders, a significant majority of whom are Indian-Americans and women.
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This is for the third time that the Department of Homeland has informed the court about the delay in issue of Notice of Proposed Rulemaking (NPRM). The DHS has filed three status reports -- on February 28, May 22, and August 20. The next status report is due on November 19.
Explaining the reasons for delay, the US attorney said since the filing of the most recent status report, the DHS's senior leadership reviewed the proposed rule and returned it to US Citizenship and Immigration Services (USCIS) this month for revisions.
"Senior leadership review and the request for revisions is standard practice within the DHS. When the necessary revisions are incorporated, the USCIS will return the proposed rule to the DHS for final clearance and submission to OMB," he said.
However, Save Jobs USA has sought an early decision from the court, arguing that the longer the case remains in abeyance, the greater the possible harm to US workers.
As of December 25, 2017, the US Citizenship and Immigration Services had approved 1,26,853 applications for employment authorisation for H-4 visa holders. These count all approvals since May 2015 when the rule was implemented. This number includes 90,946 initial approvals, 35,219 renewals, and 688 replacements for lost cards.
"Ninety-three per cent of approved applications for H-4 employment authorisation were issued to individuals born in India, and five per cent were issued to individuals born in China. Individuals born in all other countries combined make up the remaining two per cent of approved applications," the Congressional Research Service said in its recent report, based on information obtained from the US Citizenship and Immigration Services (USCIS).

Sebi allows NRIs, resident Indians, OCIs to invest in India via FPI route

The Securities and Exchange Board of India (Sebi) on Friday diluted its controversial circular issued on April 10, which laid down the know-your-client (KYC) and ownership norms for foreign portfolio investors (FPIs).
In a reversal of stance, the market regulator has allowed both resident and non-resident Indians (NRIs), along with overseas citizens of India (OCIs), to invest in Indian markets through the FPI route, subject to certain conditions. The earlier circular virtually barred individuals with India connection from investing or managing a foreign fund.

The regulator, however, reiterated that the KYC requirements for FPIs would have to be in line with the rules under the Prevention of Money Laundering Act (PMLA).
The latest announcement comes after the April 10 circular led to a pushback from overseas investors, particularly those with an India connection. Certain investors had even approached the prime minister’s office, seeking a rethink. The latest circular incorporates measures prescribed by the former Reserve Bank of India deputy governor H R Khan-led committee earlier this month.
Sebi has said a single NRI, OCI and resident Indian can make contribution of not more than 25 per cent in foreign fund. The aggregate contribution of these investors can be 50 per cent of an FPI. Resident Indians can contribute through the RBI’s liberalised remittance scheme (LRS), which allows an investment of $250,000 per individual in a financial year.
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Sebi has said an NRI, OCI or resident Indian should not be in control of FPI.
The regulator has allowed NRIs, OCIs as and locals to act as investment managers (IM) of an FPI, provided they fulfill certain conditions. These include the IM should be “appropriately regulated” in its home jurisdiction and registers itself with Sebi.
Further, Sebi has allowed all existing FPIs and new applicants a time period of two years to meet the new conditions.
This is more than just six months of time period recommended by the Khan committee. Also, the regulator has provided 90 days to ensure compliance in case of temporary breach of the conditions. Market players said the new rules will give a boost to FPI flows into India.
“The circular will be welcomed by the resident Indian and NRI fund managers,” said Rajesh Gandhi, partner, Deloitte Haskins & Sells. “Along with domestic structures such as mutual funds and alternative investment funds (AIFs), Indian residents can now invest through global funds under the LRS route.”
“All-in-all this is a welcome move by Sebi as it addresses important irritant to the FPI community,” said Tushar Sachade, partner –financial services, PwC India.
In separate circular, Sebi has said the KYC norms for FPIs will have to as per the PMLA and the FPIs need to maintain a list of beneficial owners. The move is to curb prevent money laundering, said experts.
Those FPIs that issue participatory notes (p-notes) will also have to identify end beneficial owners of p-note subscribers. Sebi has also put in place higher disclosure requirements for so-called category-III and category-II FPIs from “high-risk jurisdiction”.
The regulator has said such investors would be required to do this exercise every year.
Experts said the timely disclosures would increase the compliance burden for the FPI community. Also, the investment threshold for investors from high-risk jurisdiction will be only 10 per cent.

Rafale row: France, Dassault contradict Hollande on Anil Ambani issue

The French government and Dassault Aviation have contradicted former President Francois Hollande's claim in choosing Indian industrial partners in the multi-million dollar Rafale jet deal.
The statement by the French government issued here late Friday comes after Hollande claimed that the Indian government suggested a particular private firm for Rafale offset contract.

Hollande was quoted in an article by a French website as claiming that the Indian government had asked the French government to nominate Reliance Defence as its India partner in the deal.
"We did not have a say in this," Hollande was quoted by the website as saying. "The Indian government proposed this service group and Dassault negotiated with Ambani."
In response to the claim, the Friday night statement said: "The French government is in no manner involved in the choice of Indian industrial partners who have been, are being or will be selected by French companies.
"In accordance with India's acquisition procedure, French companies have the full freedom to choose their Indian partner companies that they consider to be the most relevant, then present for the Indian government's approval the offset projects that they wish to execute in India with these local partners so as to fulfil their obligations in this regard."
ALSO READ: PM Modi has betrayed India: Rahul after Hollande's remark on Rafale deal
Dassault Aviation, the makers of the Rafale jets, in a statement also on Friday night, said: "This offsets contract is delivered in compliance with the Defence Procurement Procedure (DPP) 2016 regulations. In this framework, and in accordance with the policy of 'Make in India', Dassault Aviation has decided to make a partnership with India's Reliance Group. This is Dassault Aviation's choice."
The Paris-based company said that the partnership between the two giants led to the creation of the "Dassault Reliance Aerospace Ltd (DRAL) joint-venture in February 2017.
"Dassault aviation is very proud that the Indian authorities have selected the Rafale fighter," it added.
The deal to purchase 36 Rafale fighter jets from France was announced by Prime Minister Narendra Modi in 2015 and signed in 2016.
The UPA government was earlier negotiating a deal to procure 126 Rafale jets, with 18 to come in flyaway condition and 108 to be manufactured by HAL under licence.
The Modi government has repeatedly said it was Dassault that chose its India partner for offsets and that the government had no say in the deal.

IL&FS Financial Services MD & CEO Ramesh Bawa, independent directors quit

Heads have started rolling at the crisis-ridden Infrastructure Leasing & Financial Services (IL&FS) group. Ramesh Bawa, managing director and chief executive of IL&FS Financial Services (IFIN), has resigned, the group informed the stock exchanges on Friday, adding that he did not cite any reason. IFIN Executive Director Kaushik Modak will replace Bawa as CEO, market sources said. Four independent directors Renu Challu, Shubhalakshmi Panse, Uday Ved and S S Kohli and executive director Vibhav Kapoor have also resigned from the board.
The board had eight directors — four group representatives, including MD & CEO, and four independent directors. Now, only two group directors, Hari Sankaran and Arun Saha, remain.
Modak, the incoming CEO, co-founded Swakarma Finance before taking up his assignment with IL&FS in June. Between May 2015 and September 2017, he worked as CEO and country head of Rabobank India.
IFIN, a subsidiary of IL&FS, was put up for sale three weeks ago, but has failed to find any takers as prospective investors are worried over its high bad debt and recent defaults.
IFIN’s sagging financials and the Reserve Bank of India’s (RBI’s) recent directive banning the financial services firm from accessing commercial paper market following a default have changed the mood among prospective buyers.
IL&FS has informed the BSE that it has not been able to service its obligation in respect of Letter of Credit payment to IDBI Bank on September 20, 2018. It was a non-banking day on Thursday and hence payable September 21, 2018

Markets rocked by crash in financial stocks, Sensex swings 1,500 pts

The stock markets on Friday witnessed one of the most volatile days this decade as the benchmark Sensex swung nearly 1,500 points, or 4 per cent, in intra-day trade. The source of volatility was a crash in stocks of non-banking financial companies (NBFCs), led by Dewan Housing Finance Corporation (DHFL) and Indiabulls Housing Finance.
A sharp fall in shares of Yes Bank following the Reserve Bank of India’s (RBI’s) directive to its chief, Rana Kapoor, to step down in January also weighed on market sentiment. Shares of Yes Bank, which ended 29 per cent lower, accounted for 60 per cent of the Sensex fall.

The benchmark Sensex, after dropping to a low of 35,994, managed to end just 280 points, or 0.75 per cent, lower at 36,842, thanks to gains in index heavyweights such as ITC, Tata Consultancy Services (TCS), and Reliance Industries. The Nifty, after dropping 480 points (4.2 per cent) from its intra-day high, closed at 11,143, down 91 points, or 0.8 per cent. The broader market Smallcap indices fell nearly 4 per cent. The real pain, however, was felt by banks and financial stocks. NBFCs, largely dependent on wholesale funding, tanked on fears that liquidity conditions are tightening due to a broader fallout of the crisis at IL&FS and near-term factors like quarter-end demand for funds.
DHFL, after dropping 60 per cent, ended 42.43 per cent lower, its worst single-day fall. Indiabulls Housing Finance, after dropping 35 per cent, ended 8.2 per cent down. Several NBFC stocks witnessed wild gyrations, with the BSE Finance index falling 6.6 per cent intra-day.
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Graph Experts said the market fall was aggravated due to a sudden winding up of leveraged bets by panic-stricken investors. Speculation that the Reserve Bank of India (RBI) was planning to tighten norms for NBFC funding to address governance concerns added to market woes.
“It is easy to dramatise the events of today, but it is far more important to focus on the fact that we have a radically overvalued financial sector. It is a house of cards. A correction was long overdue and it finally appears that we are entering one,” Saurabh Mukherjea, founder, Marcellus Investment Managers, said.
He added financial stocks were overvalued by more than 30 per cent.
ALSO READ: Market in for a bumpy ride as experts see volatility in equities ahead
Analysts said NBFC stocks had a dream run between 2013 and 2017 as the cost of wholesale funds halved during this period. The good performance during the period saw investors pile on to the sector, resulting in skyrocketing valuations. With surging yields amid decline in the rupee and fears of widening fiscal and current account deficits, the cost of funds — a raw material for NBFCs — is on the rise.
“Wholesale-funded lenders grew rapidly and the stock markets got carried away with that. Hope the investors understand the fragile nature of the boom and cash out sooner than later,” said Mukherjea.
A secondary market transaction involving DSP Mutual Fund and DHFL raised the alarm over tight liquidity conditions and rising rates. During the week, DSP MF, to boost its cash holdings, sold DHFL papers worth Rs 3 billion at a yield of 10.75 per cent. Analysts said the deal spooked investors, who feared housing finance companies’ margins would erode as borrowing costs escalated.
Realty shares also saw corrections. Also, companies with high debt, including Reliance Communications, Adani Power, and SREI Infrastructure, ended more than 10 per cent lower.
While the broader markets have come under pressure, the headline indices have managed to hold their ground. The Sensex is up 8.2 per cent year to date, most among Asian markets.
“The markets are priced for perfection. The risk-reward is not attractive at all. We would still advice investors to book profit. We are still away from levels where we can buy,” said Gautam Chhaochharia, MD and head-India research at UBS.
“We are seeing the narrative is gradually changing with flows into local funds slowing. The global and emerging market narrative has been changing any which ways,” he added.
Cash market volumes on Friday were highest ever at Rs 659 billion on the National Stock Exchange (NSE). Also, after huge churn, both foreign portfolio investors (FPIs) and domestic institutional investors (DIIs) ended as net buyers to the tune of Rs 7.6 billion and Rs 5 billion, respectively. The gross buying and selling by both FPIs and DIIs was also one of the highest ever.

Income tax department conducts survey operation at Jet Airways

The income tax (I-T) department team is conducting survey operation at Naresh Goyal-controlled Jet Airways’ four business premises in New Delhi and Mumbai, said two persons in the know.
According to I-T sources, the tax department is probing the airline for falsification of book of accounts, siphoning of funds and issue of suspicious bogus expenses booked to group entities.

The survey operation, being conducted by 50 tax officials, is taking place under Section 133A of the IT Act at the airline's Andheri and Nariman Point offices in Mumbai to collect evidence related to financial irregularities. The survey would continue for two days, said person cited above.
Meanwhile, the tax department is also examining the airline’s deal with Godrej Buildcon where Jet is said to have received Rs 17.25 billion as a monetary consideration.
Jet Airways has been in the spotlight since August 9, after it had deferred its quarterly results amid differences with its auditors, leading to queries by stock exchanges and the market regulator. The auditor did not modify its opinion and reiterated that the airline’s future was dependent on raising capital and generating sustainable cash flows.
Jet Airways had said last month that it would seek capital infusion and sell the stake in its loyalty programme, after reporting a net loss of Rs 13.26 billion in the April-June quarter of 2018-19.
An email sent to Jet Airways did not elicit response till the time of publishing the story.

Domestic airfares rise 7.5% ahead of Diwali, ticket prices to Goa soar 30%

Domestic airfares have jumped by 7.5 per cent year-on-year for Diwali holidays, compared to last year, as airlines cash in on holiday demand.
The highest increase of over 30 per cent is seen on the Delhi-Goa and the Mumbai-Goa routes for travel during the Diwali week in November, according to data compiled by booking portal Cleartrip. Other routes with a significant fare increase are Pune-Delhi and Delhi-Mumbai showing 19 per cent and 18 per cent rise, respectively. The average growth in fares across domestic network is 7.5 per cent.

Analysts expect holiday fares to inch up further closer to the travel dates, but airlines may still not be able to fully recover higher costs as fuel costs remain elevated.
Bookings are steady and expected to pick up closer to Diwali. “The final demand is not predictable yet but despite the higher pricing, demand being at same level (to last year) two months in advance is a good sign,” said Balu Ramachandran, head of air and distribution at Cleartrip.
“We have seen 15-20 per cent growth in bookings for domestic and international destinations,” said Daniel D’ Souza, head of sales (India) and e-commerce at SOTC Tours. “The in-demand domestic destinations include Rajasthan, Goa, Himachal Pradesh, Uttarakhand and Sikkim. Air fares are around 15 per cent higher for domestic and short haul destinations as compared to last year,” said Rakshit Desai, managing director at FCM Travel Solutions.
Domestic air traffic has grown 21 per cent in the first seven months of 2018 over same period last year.
Despite a 24 per cent increase in jet fuel price domestic fares remain depressed with some experts blaming rapid capacity expansion as a reason. "Yields will be impacted in high season too unless some pricing discipline comes in," remarked an executive of private airline.
SpiceJet chairman Ajay Singh last month hinted at a fare hike for upcoming festival season. "Yields will have to rise 10 to 15 per cent to offset higher costs," Singh had said.
"While the capacity deployed is more than last year, it is not country-wide as there are slot constraints at Mumbai and the capacity between Mumbai and other metros has not seen any significant changed," said Ameya Joshi, founder of aviation blog NetworkThoughts.
"The fares will have to be about 30 per cent higher than last Diwali to ensure that the increased costs can be recovered," Joshi added.

Ex-LIC chief S B Mathur to head IL&FS board, will replace Hemant Bhargava

S B Mathur, former chairman of Life Insurance Corporation (LIC), will be the new chairman of Infrastructure Leasing & Financial Services (IL&FS), which is facing a liquidity crisis. He will replace Hemant Bhargava, LIC’s managing director, who was also serving as non-executive chairman at IL&FS since July. The decision was taken at a meeting of the IL&FS board on Saturday.
Bhargava stepped down from the IL&FS board to avoid conflict of interest in view of his responsibility as the incharge of investment at the state-owned insurance company, sources said. He had come on the IL&FS board after Ravi Parthasarathy quit as chairman on health grounds.
ALSO READ: IL&FS Energy Development defaults on term credit to financial institutions

LIC is the largest shareholder in IL&FS, the group holding entity, with a 25.34 per cent stake as on March 31, 2018.
The IL&FS board had a meeting on September 7, but it was adjourned to September 15 to allow all directors to participate in the ongoing deliberations on ways to restore normalcy in the company. The board members were to discuss equity infusion, fundraising and asset divestment plan.
According to sources, a meeting of shareholders will be held in a fortnight to approve the proposal for a rights issue. The board of directors has already approved the rights issue of 300 million equity shares at Rs 150 apiece, aggregating to Rs 45 billion, to shore up the capital of IL&FS. The rights issue is to be completed by October 30. As on March 31, 2018, IL&FS’s net worth was Rs 74 billion.
There was no clarity on whether lenders like SBI and LIC have given immediate financial assistance to IL&FS to tide over the liquidity problem. The immediate assistance was needed to ensure that IL&FS had enough funds to meet its repayment obligations, sources said.
The group is facing the problem of overleverage and liquidity strain. The situation has arisen as a significant percentage of the group’s liquidity, aggregating to over Rs 160 billion, is stuck in claims and termination payments. Rating agencies have downgraded loans and debentures of IL&FS and its several group entities to ‘non-investment grade’ on delays in payment on due dates and defaults.
The board approved the recapitalisation of group companies to the extent of Rs 50 billion, in IL&FS Financial Services, IL&FS Transportation, IL&FS Energy, IL&FS Environment, and IL&FS Education.
The group has a specific asset divestment plan based on which it expects to reduce its overall debt by Rs 300 billion. The gross debt of ILFS was about Rs 910 billion at the end of March 2018.
Of the portfolio of 25 projects identified for sale, firm offers have been received for 14 projects. The company expects to complete its divestment plan over the next 12 to 18 months in a systematic and professional way to fulfil its commitments.

Centre to stick to fiscal target of 3.3% as tax revenues on the rise: FM

Finance ministry officials on Saturday apprised Prime Minister Narendra Modi of the “comfortable” revenue position, which they said would help contain the fiscal deficit at the targeted 3.3 per cent of gross domestic product (GDP) in 2018-19, without resorting to any squeeze on the capital expenditure.
On the second day of his review of the economy against the backdrop of a falling rupee and surging oil prices, the prime minister took stock of tax collections and macroeconomic indicators. He was told that the economic growth would surpass 7.5 per cent in the current financial year, after the economy expanded at a nine-quarter high of 8.2 per cent in April-June.

On Friday, the government had announced five-pronged measures to fund the current account deficit (CAD). It also decided to curb non-essential imports and increase exports. The latest announcements are likely to boost market sentiment.
“We are optimistic about our growth rate and tax collection. As far as the fiscal deficit is concerned, we will strictly meet the 3.3 per cent target,” Finance Minister Arun Jaitley told reporters after various departments of his ministry, such as economic affairs, revenue, and investment and public asset management, made presentations to the prime minister.
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Graph Figures in Rs trillion (bracketed numbers denote percentage of full-year target) He said the government was confident that it would surpass the direct tax collection target and would meet or surpass the overall tax collection target, including that of the goods and services tax (GST).
While various commentaries have observed that the government might have to resort to capital expenditure cuts to contain the fiscal deficit, Jaitley said, “We have already spent about 44 per cent of the Budget Estimates till August 31 and we will end the year without any cut. We will maintain the 100 per cent capital expenditure because that is extremely necessary for maintaining the growth rate.”
Earlier, Moody’s Investors Service had said that while the government might cut back on capital expenditures to limit fiscal slippage, as has happened in previous years, such cuts might not fully offset the revenue losses and higher spending on energy subsidies and price support for crops.
The finance minister tried to assuage investors that economic growth would not be compromised while containing the fiscal deficit.
The Centre’s fiscal deficit has touched 86.5 per cent of the Budget Estimates in the first four months of the current financial year itself. However, the position was a bit better than last year, when 92.4 per cent of the target was hit this time around.
Jaitley said, “The department of revenue made a detailed presentation to say that we are already ahead of the schedule in direct tax collections. And even though we had a stiff target for direct tax collection, we can now see the impact of all the anti-black money measures which we had taken, like demonetisation and the GST.”
The government has targeted a 14.43 per cent increase in direct tax collections at Rs 11.5 trillion in 2018-19 against Rs 10.05 trillion the previous year. However, the numbers released by the Controller General of Accounts (CGA) have revealed that direct tax collections grew by only 6.6 per cent during April-July.
Jaitley said there was a phenomenal increase in the assessee base.
Figures released by the income tax department showed that the returns filed rose 70.86 per cent at 54.2 million till August 31, which was the last date of filing returns, against 31.7 million a year ago.
“There is a phenomenal increase in the quantum of advance tax which has been paid. And the CBDT itself is very clear that this year they will be able to collect in excess of the Budgeted target.”
Advance tax collections for personal income tax assesses increased by 44.1 per cent and those in the corporate tax category by 17.4 per cent in the first quarter of 2018-19.
The finance minister said the GST was settling down and a pick-up in consumption would obviously have an impact on the collections in the coming months.
However, the Centre and state governments could not achieve the target of collecting Rs 1 trillion a month in FY19, except in the month of April, which was due to arrears paid.
“We are confident that between direct and indirect tax collection, the government will comfortably meet the target, if not surpass it,” Jaitley said.
He also said that the government was confident of not only maintaining the disinvestment target this year but also probably surpassing it, as was done last year.
The government has collected Rs 92.19 billion from disinvestment receipt against the target of Rs 800 billion for FY19. Last year, the government collected a little over Rs 1 trillion from disinvestment, against the budgeted target of Rs 725 billion. Jaitley said the prime minister expressed satisfaction over the macroeconomic data that came recently.
The Index of Industrial Production (IIP) grew at 6.6 per cent in July, even though it moderated from 6.8 per cent in June. Similarly, retail price inflation declined to a 10-month low of 3.69 per cent in August. The trade deficit situation still remained worrisome even as it fell to $ 17.4 billion in August from $ 18.2 billion in July.