Malaysia hikes sugar import from India to resolve palm oil spat: Report

Malaysia's top sugar refiner said it will increase purchases of the commodity from India, which according to two sources is part of efforts to placate New Delhi amid an ongoing spat over palm oil imports.
MSM Malaysia Holdings Berhad will buy 130,000 tonnes of raw sugar from India worth 200 million ringgit ($49.20 million) in the first quarter, the company told Reuters. It bought around 88,000 tonnes of raw sugar from India in 2019.

MSM is the sugar refining arm of the world's largest palm oil producer, FGV Holdings, which is an unit of Malaysian state-owned Federal Land Development Authority or Felda.
The company did not cite the palm oil dispute as a reason for the increase in purchases.
But the two sources, who are familiar with discussions between the company and the government on the purchase, said it was a bid to appease India, which has been urging Malaysia to reduce the trade deficit between the countries.
India, the world's largest edible oil buyer, this month effectively halted Malaysian palm oil imports apparently in retaliation to Malaysian Prime Minister Mahathir Mohamad's comments criticising New Delhi over its policy on Kashmir.
Malaysia has said it will look to other markets to sell more palm oil but that may not be easy as India has been the biggest buyer of Malaysian palm oil for the past five years, purchasing 4.4 million tonnes in 2019.
Malaysia's exports to India were worth $10.8 billion in the fiscal year that ended on March 31, while imports totalled $6.4 billion.
Malaysia imported a total of 1.95 million tonnes of raw sugar in 2019, according to data from the International Sugar Organization on Refinitiv Eikon. It typically buys more from Brazil and Thailand than from India.
India is the world's biggest sugar producer but is struggling with a surplus. Its exports are expected to rise to a record 5 million tonnes for the 2019/20 season.
MSM said it was expecting the arrival of three shipments of raw sugar from India between January and February.
"This is very good move. It will help India in increasing sugar exports," Praful Vithalani, president of the All India Sugar Trade Association told Reuters about MSM's move to buy more from India.
Around 50,000 tonnes of raw sugar has already been contracted by Malaysia for January shipments, said a Mumbai-based dealer with a global trading firm.

No curbs on Turkey, Malaysia; will treat all nations equally: Piyush Goyal

The government is not contemplating any curbs on imports from Malaysiaand Turkey, Commerce and Industry Minister Piyush Goyal said on Thursday.
He said that India believes in fair play and equal treatment to all the countries.

"I don't think we have put any curbs on imports from Malaysia, and neither we are contemplating nor we have put any curbs on Turkey," he said here at the Raisina Dialogue.
The minister said that any import curbs being imposed by India is only to protect interest of the country and it is uniform in nature.
"If some of the restrictions impact Malaysia, I don't think that is the only country that is being impacted. There are other exporters to India who would have the same impact," he added.
The government on January 8 imposed restrictions on imports of refined palm oil, which is expected to impact Malaysia.
Indonesia and Malaysia are the two countries which supply palm oil.
The move comes in the backdrop of remarks by Malaysia on the new citizenship law and Kashmir issue.
On December 20 last year, Malaysian Prime Minister Mahathir bin Mohamad had reportedly said, "I am sorry to see that India, which claims to be a secular state, is now taking action to deprive some Muslims of their citizenship".
"If we do that here, you know what will happen. There will be chaos, there will be instability and everyone will suffer," he had said.
Turkey too criticised India over the situation in Kashmir.

Malaysia to cancel $20-bn China-backed rail project due to high cost

Malaysia's economics minister said on Saturday the country will cancel the $20 billion East Coast Rail Link (ECRL) project with contractor China Communications Construction Co Ltd.
Mohamed Azmin Ali said at a media event that the cost of the project was too great, while giving an assurance that Malaysia would welcome all forms of investment from China on a case by case basis.

Will Malaysia's power shift pose a threat to China's ambitious OBOR?

Malaysia was once a loyal partner in China's globe-spanning infrastructure drive but a new government is now pledging to review Beijing-backed projects, threatening key links in the much-vaunted initiative.
Kuala Lumpur's previous regime, led by scandal-mired Najib Razak, had warm ties with China and signed a string of deals for Beijing-funded projects, including a major rail link and a deep-sea port.

But the long-ruling coalition was unexpectedly turfed out of power last month by voters disgusted at allegations of corruption and angered at rising living costs.
Critics say many agreements lacked transparency, fuelling suspicions they were struck in exchange for help in paying off debts from a financial scandal which ultimately helped bring down Najib's regime.
The new government, led by political heavyweight Mahathir Mohamad, has pledged to review Chinese deals seen as dubious, calling into question Malaysia's status as one of Beijing's most cooperative partners in its infrastructure push.
China's ambitious initiative to revive ancient Silk Road trading routes with a global network of ports, roads and railways -- dubbed "One Belt, One Road" -- was launched in 2013 and is the economic crown jewel of President Xi Jinping's presidency.
Malaysia, along with Beijing ally Cambodia, were seen as bright spots in Southeast Asia, with projects in other countries often facing problems, from land acquisition to drawn-out negotiations with governments.
"Malaysia under Najib moved quickly to approve and implement projects," Murray Hiebert, a senior associate from think-tank the Center for Strategic and International Studies, told AFP.
Chinese foreign direct investment into Malaysia stood at just 0.8 percent of total net FDI inflows in 2008, but that figure had risen to 14.4 percent by 2016, according to a study from Singapore's ISEAS-Yusof Ishak Institute.
However, Hiebert said it was "widely assumed" that Malaysia was striking quick deals with China in the hope of getting help to cover debts from sovereign wealth fund 1MDB.
Najib and his cronies were accused of stealing huge sums of public money from the investment vehicle in a massive fraud. Public disgust at the allegations -- denied by Najib and 1MDB -- helped topple his government.
Malaysia's first change of government in six decades has left Najib facing a potential jail term -- and appears to have already unsettled Beijing's plans in the country.
New prime minister Mahathir has announced a planned high-speed rail link between Kuala Lumpur and neighbouring Singapore will not go ahead as he seeks to reduce the country's huge national debt.
The project was in its early stages and had not yet received any Chinese funding as part of "One Belt, One Road".
But Chinese companies were favoured to build part of the line, which would have constituted a link in a high-speed route from China's Yunnan province to trading hub Singapore, along which Chinese goods could have been transported for export.
Work has already started in Malaysia on another line seen as part of that route, and which had received Chinese funding -- the USD 14-billion East Coast Rail Link, running from close to the Thai border to a port near Kuala Lumpur.
Mahathir has said that agreement is now being renegotiated. Other Chinese-funded initiatives include a deep-sea port in Malacca, near important shipping routes, and an enormous industrial park.
It is not clear yet which projects will be changed or cancelled but experts believe axing some will be positive.
Alex Holmes, Asia economist for Capital Economics, backed cancelling some initiatives, citing "Malaysia's weak fiscal position and that some of the projects are of dubious economic value".
The Chinese foreign ministry did not respond to request for comment. But a recent commentary in China's Global Times, a nationalist state-run tabloid, warned Mahathir if he damaged the interests of Chinese companies, they had the right to seek compensation.
"The Chinese government will also take concrete measures to safeguard the interests and rights of Chinese enterprises," it said.
Adding to China's woes, Mahathir has a clear preference for Beijing's rival Japan, and last week went to Tokyo for his first foreign trip since taking office.
During the visit, the 92-year-old signalled ties with Beijing would cool: "We will be friendly with China, but we do not want to be indebted to China.

TPG-Manipal revises offer for Fortis, raises value to Rs 83.58 billion

After Malaysia's IHH Healthcare and Hero Enterprise-Burman Family sweetened their offers for the beleaguered Fortis Healthcare assets on Tuesday, the last day for submitting binding bids, Manipal-TPG has too raised their offer on Sunday.
The expert advisory committee, led by former PwC Chairman Deepak Kapoor, will meet on Tuesday to evaluate the offers and place their recommendation to the board on Thursday.
TPG-backed Manipal has valued Fortis at Rs 83.58 billion (which translates into Rs 160 per share) and has proposed to merge into Fortis, creating the largest healthcare platform in the country. The offer values Manipal Health Enterprises at Rs 60.70 billion. Once the merger becoming effective, the shareholders of Manipal Health Enterprises shall be issued equity shares in Fortis in accordance with the swap ratio for the merger.
Moreover, Manipal-TPG has also proposed to subscribe to equity shares of Fortis for an amount of Rs 21 billion (at Rs 160 per share preferential allotment). The proceeds would be used to meet working capital requirements, repay existing loans and partly fund the acquisition of assets from RHT Health Trust. The preferential allotment would be subject to receive regulatory approvals, which includes Competition Commission of India (CCI).
Further, Manipal proposed to buy the stakes held by private equity firms in SRL, the diagnostic arm of Fortis Healthcare, at Rs 36 billion. After the transaction, the SRL board will be restructured and Manipal-TPG wants to appoint a majority of directors on the reconstituted board.
After the merger, Fortis will undertake a rights issue to raise additional capital. The purchase of the Singapore-based RHT’s assets will be funded through debt, apart from the proceeds from the preferential allotment.
Manipal-TPG, however, has said their new offer does not require any further due diligence. The proposal is binding and valid until May 15. This is the fourth offer from Manipal-TPG for Fortis.
Ranjan Pai, managing director and chief executive officer, Manipal Health Enterprises, said this was a ‘compelling offer’ from their side that took care of all the medium- to long-term needs of Fortis and created value for the shareholders. “We are bringing in value addition of about Rs 90 billion and that too without altering any structure of the Fortis,” he said, adding that the latest offer from Manipal-TPG not only takes care of the immediate liquidity issue of Fortis but also takes care of the PEs in SRL (which is a liability for SRL), buy back the RHT assets (organise debt for the transaction if required), gives an opportunity to shareholders to participate through a rights issue. “On top of it, it gives Fortis a promoter. It needs one at the moment, unlike many other bidders, who are looking at simple fund infusion,” Pai said.
Bidding for Fortis closed on May 1. Manipal Hospitals, however, had a chance to revise its offer until May 6, based on the bids received till May 1. This is as per ‘obligations’ towards Manipal-TPG consortium, Fortis had said.
Last week, IHH had submitted a revised offer, valuing Fortis at Rs 175 per share, up from its earlier offer of Rs 160 per share. Sunil Kant Munjal of Hero Enterprise, along with Anand and Mohit Burman, submitted a revised binding proposal to invest ~18 billion directly into Fortis without due diligence.
The Hero Enterprises-Burman Family office duo has also revised the validity of its offer till May 15 and have now sought three board seats instead of the two. The Munjal-Burman has also objected to the bidding process and has asked for an equal opportunity to all bidders without any unfair advantage to one party.

Fortis has appointed Arpwood Capital to advise the board on various sale bids.
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