NEW DELHI, mumbAi, beNGALuru, kOLkAtA, cHeNNAi, AHmedAbAd, HyderAbAd, cHANdiGArH*, PuNe*, LuckNOw* VOL. 17 NO.

283

Tuesday, November 28, 2023

Irdai questions Care top brass LIC glare on cos bringing gen-
livemint.com on Rashmi Saluja’s Esops uP1 next to board, top roles uP1
 NEW DELHI, MUMBAI, BENGALURU, kOLkATA, CHENNAI, AHMEDABAD, HyDERABAD, CHANDIGARH*, pUNE*, LUCkNOw*
Tuesday, November 28, 2023
Think Ahead. Think Growth.
mint primer
GPS spoofing:
how flights are
being led astray
BY ANU SHARMA
A Dubai-bound business jet from Europe flew into Iranian airspace
with no clearance in September—due to a false signal on the aircraft
navigation system. After about 20 planes faced similar issues, the
Indian aviation regulator issued an advisory last week. Mint explains:
BLOOMBERG
What is at the heart of Where has it been
1 the problem?
It has to do with interference with
2 reported from?
According to the European
the Global Navigation Satellite Aviation Safety Agency (EASA),
System (GNSS), a key technology GPS spoofing has risen since 2022
used for navigation and with increase in sophistication. So
communication. GNSS refers to a far, GPS spoofing in aviation has
constellation of satellites providing mainly been seen in areas around
signals that transmit positioning conflict zones but is also prevalent
and timing data to GNSS receivers. in the south and eastern
These signals, however, can be Mediterranean and Black Sea,
vulnerable to interference due to Baltic Sea, and Arctic area. It has
their weak transmitting power. caused greater concern after about
Under GNSS interference, also 20 business jets and commercial
called GPS spoofing, hackers flights, including wide-body
attempt to manipulate a user’s aircraft, reported GPS spoofing
navigation system by sending near the Iran-Iraq border in
counterfeit signals to a receiver September. In fact, a business jet
antenna. Such interference can
severely impact the accuracy of the
was reported to have ventured into
Iranian airspace without
GPS-using device. clearance.
ISTOCKPHOTO
3 What are the implications
for an aircraft?
GPS spoofing provides false signals to the
GPS receiver of a plane, manipulating its
inertial reference system. This can put the
aircraft off its intended course and result in
intrusion or collision. A GNSS interference
can also result in false data for a plane’s fuel
computation system, flight management
system, and ground or wind speed
information on the navigation display.
Is there a solution to What is India doing
4 this problem?
There is no clear solution yet for
5 about it?
After forming a committee on GPS
the kind of spoofing seen in the spoofing in October, the Indian
past few months, but aircraft civil aviation regulator issued an
makers and technology providers advisory to Indian airlines on 24
are working on it. The source of November. It has provided a
the interference has been around mechanism for air navigation
West Asia but the perpetrators are service providers to establish a
unknown. For now, the solution threat monitoring and analysis
could be better training for pilots. network in coordination with the
In fact, global aviation regulatory regulator for preventive as well as
bodies have advised airlines to reactive threat monitoring. It also
train their crew on GPS spoofing, wants reports of GNSS
and discuss the possible interference to be analyzed so as to
alternatives to conventional develop a robust and immediate
arrival-and-approach procedures threat response capability to a
during flight planning. spoofing incident.
MINT PODCASTS
WELL-BEING MATTERS TAX ON MINORS
Amid a rise in hybrid working, led by Mint’s Shipra Singh Sorout speaks
the covid-19 pandemic, wars, and with Nitesh Buddhadev, founder of
geopolitics, a key Nimit Consultancy,
question that arises about the tax rules
is: How can firms that become appli-
ensure the well-be- cable on a minor
ing of their staff? child when she/he
Join Leslie D’Monte earns a cash prize,
and Jayanth N. gets an inheritance,
Kolla in conversation with Susanna or her/his parents invest in their
Sjoberg, an organizational mental name. Tune into this podcast to gain
health expert, to find answers. some useful insights.
VOL. 17 NO. 283
QUICK EDIT
A notch
faster
The latest forecast for India’s
economic growth by Standard
& Poor’s is out. The global rating
agency now sees India’s gross
domestic product expanding
6.4% in 2023-24, up from the
6% it had pencilled in earlier.
That’s a respectable bump-up
and S&P attributes it to the
robust momentum in the
domestic economy, which
seems to have offset headwinds
on the export front and lived
down high food inflation. To be
sure, this merely brings its fore-
cast closer to the Reserve Bank
of India’s 6.5% estimate. So, it
might not be very eye-catching,
after all. Yet, its raised expecta-
tion does help reinforce the
reading that India’s economy is
faring well. Next year, however,
could be tougher. Weighed by
the full effect of monetary tight-
ening, global weaknesses amid
intense geopolitical turmoil and
a high base, S&P now forecasts
India’s growth in 2024-25 at
6.4%, a good half-a-percentage-
point lower than its previous
estimate of 6.9%. The consola-
tion, however, is that this is
expected to be temporary, with
a rebound to 6.9% projected in
2025-26. Overall, the numbers
look reassuring. Barring a Black
Swan shock, India’s economy
seems set to do well in the face
of global turbulence.
MINT METRIC
by Bibek Debroy
In Delhi a wannabe
Set up a factory for fake ghee.
Sumit produced on demand,
Every famous brand.
Master of the spurious was he.
QUOTE OF THE DAY
[The] domestic market and our
macroeconomic fundamentals are
fairly well rooted. India is
comfortably placed because of our
stable policy and predictable tax
domains, but factors outside are
not in our control.
NIRMALA
SITHARAMAN
UNION FINANCE
MINISTER
NEW INCENTIVE
As India Inc. looks beyond wage hikes
to retain high performers, firms are
focusing on person-
alized upskilling
programs as an
incentive. Nishchae
Suri, managing
director India for
Cornerstone, talks
to Devina Sengupta on The Working
Life about how upskilling can be the
crucial ace up HR’s sleeve.
 PLAIN FACTS

How world economy

is doing, in five charts
BY PRAGYA SRIVASTAVA

E
very month, Mint’s Plain Facts section brings out an update on key global economic data to thread together the biggest
developments in the world that are worth paying attention to. The accompanying analysis and charts attempt to explain
how each story is creating ripples on the global stage, where it is headed in the coming weeks, and whether it can impact
India. This time, we explain incoming central bank decisions in various countries, and the deflation in China that’s raising
questions about its growth prospects.

Many central banks may pause again in

higher-for-longer interest rate regime 1 Monetary Policies
Policy interest rates (in %) NEARLY FOUR years ago, central banks around the world cut
Pandemic low Current policy interest rates to all-time lows and kept them there for
4 months. Then they raised them back quickly to tame the
India resulting inflation. Now, the discourse has moved to holding
6.5
policy rates in a balancing act. In December, central banks of
0.25 the US, UK, European Union, India and Japan will announce
US
5.5 their monetary policy decisions. All these central banks, barring
Japan’s, have already hiked interest rates sharply from the
0.1
UK
5.25
pandemic lows, and with the inflation not as intense as it was a
year ago, they are likely to hold rates once again, in what has
European 0 been described as higher-for-longer interest rate regime.
Union 4.5 That’s because inflation, even though softening, is yet to
settle down at the targets set by the central banks. Japan, on the
-0.1
Japan other hand, has maintained its ‘super’ accommodative stance so
-0.1
far, but could make the first move early next year as inflation is
Source: Bloomberg
continuously printing above its target of 2%.

2 Troubles Ahead? China experiences deflation for

second time in four months
GROWTH SLOWDOWN in China has been a cause of worry Year-on-year CPI inflation (in %) in 2023
for the world, and now deflation in the country has added more
to it. China experienced deflation in October, the second such 2.1
instance in four months, which has led to concerns that the
world’s second-largest economy may be experiencing what
Japan faced in the 1990s. Since inflation is considered a signal
about the performance of the economy, the second year-on-year
decline, and the sixth month-on-month decline in prices could 1
be a sign of low demand. While much of the world is struggling 0.7
with high inflation, deflation in China is at odds with the trend.
The accommodative monetary policy in the country has also 0.2
led to widening of the gap between interest rates of China and 0.1 Jul
0.1 Oct
0 0
the US, which may have fuelled capital outflow. In the Jan Feb Mar Apr May Jun Aug Sep
September quarter, China reported negative foreign direct -0.2
-0.3
investment (FDI) flows for the first time in 25 years, signalling
Source: Bloomberg
weak investor sentiments.

3 Climate Commitment Several countries fall short of their pledged

climate finance commitment
AS CLIMATE change increasingly becomes a global Countries with biggest gap in pledged climate finance
issue, impacting agricultural output and food prices, the and deposited amount (in $ billion)
Conference of the Parties (COP)—the annual 8 Pledged Deposited
international climate summit convened by the UN—will 7
be held from 30 November to 12 December in Dubai. 6
Despite the widespread impact of climate change, the
5
annual talks have been divisive, with poorer countries
seemingly bearing the brunt of pollution caused by 4
historical development in western countries. Moreover, 3
the venue of this year’s COP is also mired in controversy 2
since the United Arab Emirates is a major oil producer. 1
While countries have committed funds to finance
steps to tackle climate change, many fall short. 0
UK US Germany Japan Norway Italy
According to the Global Fund update, climate finance *Analysis based on countries as per Annex II of the the United Nations Framework
deposited by industrialized countries is still short by $5 Convention on Climate Change. Data as of December 2022.
Chart: Manjul Paul Source: Climate Funds Update
billion of what they had pledged, as of December 2022.

Argentina has grappled with triple-digit

inflation throughout the year 4 Argentina’s Woes
Year-on-year CPI inflation (in %) in 2023 WHILE HIGH inflation is currently a global headache, the
160 problems are nowhere close to what Argentina has been facing: a
triple-digit rise in prices on a year-on-year basis in each of the
142.7 months between February and October. The result is the victory
140 of right-wing libertarian Javier Milei, who has vowed to
“exterminate” inflation, last week.
The president-elect has promised to replace the country’s
120 currency peso with the US dollar (known as dollarization) to fight
inflation, which seemed to have worked for the voters struggling
with high cost of living. Several Latin American countries such as
100 Ecuador and El Salvador have already adopted the dollar as their
98.8 currency to bring in economic stability. However, given
Argentina’s size, dollarization may be an uphill task, with some
80 experts saying it would strip the country of its sovereignty. For
Jan Feb Mar Apr May Jun Jul Aug Sep Oct now, the International Monetary Fund has projected Argentina’s
Source: Trading Economics inflation to moderate to 32.5% by 2028.

5 Tides Turning? Global smartphone market has shrunk

due to component shortage
FOR THE past two years, the global smartphone market has been Global smartphone shipments (in million)
under pressure due to shortage of components and low demand 400
due to the slowdown in the economic growth. Global smartphone 354.9
350
shipments declined 0.7% in July-September 2023 year-on-year
(y-o-y), 9% in April-June and 14.2% in January-March, according 299.8
300
to the quarterly data released by Counterpoint Research. While
250
the shipments are significantly lower than levels seen in 2021, the
pace of contraction has slowed with each quarter. Moreover, the 200
latest preliminary numbers from Counterpoint’s monthly tracker
show the global monthly smartphone sell-through volumes grew 150
5% y-o-y in October, breaking the streak of 27 consecutive months 100
of declines due to the recovery in emerging markets, including
festivities-related optimism in India. The expansion is expected to 50
continue in the December quarter, marking an era of gradual
0
recovery for the global smartphone market. Q1 2021 Q3 2023
Source: Counterpoint
pragya.s@livemint.com
PARAS JAIN/MINT

PEANUTS by Charles M. Schulz

 NEw DElhI, mUmBAI, BENGALURU, kOLkATA, CHENNAI, AHmEDABAD, HYDERABAD, CHANDIGARH*, PUNE*, LUCkNOW*
Tuesday, November 28, 2023
SENSEX 65,970.04 0.00
Irdai questions Care
brass on Esops issue
Religare unit asked to reply in a week on “excessive” grant
Anirudh Laskar
anirudh.l@livemint.com
mUmBAI
T
he insurance regulator
has asked top executives
of Care Health Insurance
Ltd to explain the issue of
stock options to non-ex-
ecutive chairperson Rashmi Saluja
despite being told not to do so, two
people aware of the matter said.
On 22 November, officials of the
Insurance Regulatory and Develop-
ment Authority of India (Irdai) sum-
moned Anuj Gulati and Anoop
Singh of Care Health and ques-
tioned them about “excessive”
stock options issued to Saluja and
Gulati, the people said on the condi-
tion of anonymity. While Gulati is
managing director and chief execu-
tive of Care Health, Singh is chief
compliance officer.
“Irdai is very concerned about
22.7 million employee stock options
(Esops) approved by the Dr. Saluja-
led board of Care Health to Dr. Saluja
herself. This is worth hundreds of
crores of money for one person who
is not a promoter, just an employee,”
one of the two people said.
The issue of stock options came
into focus after the Burman family
(of Dabur) made an open offer for
Religare Enterprises Ltd, the parent
VOL. 17 NO. 283 Rs. 10.00 . Price with Hindustan Times Rs. 15.50 18 PAGES
Tale of two states: what Maruti Suzuki sets stage for
livemint.com numbers tell us uP10 price hikes in 2024 uP5
NIFTY 19.794.70 0.00 DOLLAR ₹83.38 ₹0.00 EURO ₹90.90 ₹0.00 OIL $79.60 $0.79 GOLD ₹61,229 ₹0.00
LIC glare on firms
bringing gen-next
Penalties rise
as RBI turns
DON’T MISS
BLOOMBERG
up scrutiny of
to board, top roles banks, NBFCs
Shayan Ghosh
Varun Sood shayan.g@livemint.com
varun.sood@livemint.com mUmBAI
BENGALURU S&P Global raises India’s FY24
T
he Reserve Bank of India GDP growth, cuts FY25 estimate
SoP STorY
F
ounders of public compa- (RBI) slapped penalties S&P Global Ratings said India’s economy in
nies naming their scions as totalling ₹71.4 crore in 56 FY24 will grow at a faster clip than it projected
While Religare did recover under Rashmi Saluja’s leadership, her
senior executives or board cases in the year so far as it before hitting a slower-than-estimated
compensation has occupied centre stage in the battle for the firm. trajectory in the next fiscal. The rating agency
members may find the going enhanced scrutiny of banks,
(in ₹ crore) REL STOCK PRICE ON harder as the passing of baton non-banks and other regulated revised the GDP growth projection for FY24
REL market to 6.4% from 6% earlier. >P2
cap 279.9 280.3 comes under greater scrutiny entities, data compiled by Mint
258.1
220.7 from the world’s biggest public showed. In comparison, the
7,164 175.6
money managers, including banking regulator levied fines Byju’s penalized for misleading
Life Insurance Corp. of India of ₹26 crore across 34 cases in IAS coaching advertisements
10,000 (LIC), the country’s largest all of last year.
Care Health The Central Consumer Protection Authority
estimated value* domestic institutional investor. LIC expressed its unhappiness The reasons included non- (CCPA) has imposed a penalty of ₹10 lakh
2 Jan 21 Sep 22 Sep 25 Sep 24 Nov LIC expressed its unhappi- over 12 such proposals. PTI compliance with guidelines on on edtech platform Byju’s for publishing
(weighted (The two days when The day of The last
average) Saluja sold her REL open-offer trading day ness over 12 proposals pertain- lending, delay in paying inter- allegedly false and misleading
shares^) announcement
ing to the appointment or reap- chairman Gautam Adani. est to senior citizens, and not advertisements for its online IAS
SALUJA'S COMPENSATION (FY23) pointment of the next genera- “With less than 10 years of specifying the date of interest coaching offering. >P5
tion of founders in 11 promoter- post-qualification work experi- rate reset on some loans.
₹5.82 cr ₹1 cr ₹1.3 cr ₹33.9 cr ₹103.2 cr** led firms between January ence, his experience is not The penalty data, available
SALARY and RETENTION ACCOMMODATION, THE value of Esops THE value of her True North raises ₹1,000 crore
2022 and 30 September 2023, enough to be an executive till 24 November, does not
allowances bonus car and other
perquisites
exercised (2.5 mn REL
shares out of the 5 mn
1.42% REL stake
according to a Mint review of director on the board of a listed include action against coopera-
towards maiden credit fund
granted in FY21) True North, the homegrown private equity
LIC data on voting records. company,” LIC reasoned when tive and regional rural banks.
*Conservative estimate based on proxy advisory report; **As per closing price on 24 Nov
Despite its strong observa- the proposal was put before Some of the prominent len- firm with assets under management of over
^REL stock saw the highest intraday levels YTD on those two days $3 billion, has raised ₹1,000 crore towards
tions, though, LIC, which man- shareholders to vote in July. ders penalized this year include
Source: Company filings, stock exchanges, Mint research its maiden credit fund, marking its entry into
ages ₹47,43,389 crore ($569.3 “Remuneration not capped,” ICICI Bank, State Bank of India a second asset class, two senior executives
SARVESH KUMAR SHARMA/MINT
billion) of assets, did not reject LIC noted, even though it (SBI), Paytm Payments Bank, told Mint. >P3
of Care Health. After the Religare per share will cost ₹2,116 crore. The all but one resolution, thereby eventually decided not to vote Bajaj Finance, Citibank and
board opposed the proposal, the total 51% stake that the Burmans saving the promoters from on the proposal. Mahindra & Mahindra Finan-
Burmans alleged that Saluja, who is aim to own is worth about ₹3,400 embarrassment. For this rea- Twenty-two per cent of large cial Services. FPI debt inflows at 26-month
also non-executive chairperson of crore. After a brief initial welcome, son, all 12 proposals secured investors voted against Sagar The regulator itself pub- high in Nov on Fed rate pause
Religare, had received hefty stock the Religare board claimed the offer majority approval. Adani’s re-appointment, lishes consolidated data on FPI inflows into Indian bonds in November
options from Care. price was low and accused the Bur- Take, for example, LIC’s according to voting records penalties, but on a fiscal year have hit the highest in 26 months, owing to
The open offer by the Burman mans of having links with Radha observations on the resolution published on BSE. But a 56.26% basis. In 2021-22, it penalized higher allocations by foreign investors to
family for Religare, where it already Soami Satsang Beas (RSSB) and Rel- seeking the reappointment of promoter holding and the banks and non-banks in 44 emerging markets, among other things, in
owns a 21.54% stake, was igare founders Shivinder and Mal- Sagar Adani at Adani Green abstention of LIC, which owns instances, compared to just 18 anticipation of US interest rates hitting peak.
announced on 25 September. The Energy Ltd. Sagar Adani is the Analysts expect the flows to stay strong. >P4
offer for the additional 26% at ₹235 TURN TO PAGE 6 nephew of group founder and TURN TO PAGE 6 TURN TO PAGE 6
02 TuesDay, 28 November 2023
New Delhi ECONOMY & POLICY LIVEMINT.COM

m MINT SHORTS
India, US looking to tie up Predator
S&P Global raises FY24 GDP India moves
on WTO
drone deal early next year
New Delhi: India is looking at sealing a landmark deal to procure
31 MQ-9B Predator long-endurance armed drones from the US
under a government-to-government framework by March with
growth, cuts FY25 estimate dispute
settlement
the US Congress expected to clear the supplies in the next few
weeks, people familiar with the matter said. PTI PTI
feedback@livemint.com
Robust domestic momentum has offset headwinds from high food inflation and weak exports
‘Solar installations fall 47% to
I
ndia, South Africa and
Egypt have introduced a
5.6GW in Jan-Sep period’ Pranati Deva demand in the consumer goods seg- paper regarding ongoing
HT
pranati.deva@htmedialabs.com ment, even as new orders dropped to the discussions on the reforms
NEW DELHI lowest in a year and cost pressures of the World Trade Organi-
intensified. Going ahead, the rating zation’s (WTO) dispute set-

S
&P Global Ratings said India’s agency expects emerging market econ- tlement body, an official
economy in FY24 will grow at omies to report higher domestic said.
a faster clip than it previously demand than their global peers. The rat- The paper “Reflections on
projected before hitting a ing agency expects overall growth in the the Reform of the WTO Dis-
slower-than-estimated trajec- Asia-Pacific region to be on track. pute Settlement System”, was
tory in the next financial year. The rating “Overall, growth this year and next is introduced at a meeting of the
agency revised the Gross Domestic on track to be the strongest in emerging body in Geneva.
Product (GDP) growth projection for market economies with solid domestic In the meeting, “India took
financial year 2024 to 6.4% from 6% ear- demand, in India, Indonesia, Malaysia, the floor to introduce the joint
lier on the back of strong domestic tail- and the Philippines,” S&P Global said. communication from Egypt,
New Delhi: India has reported a 47% fall in solar installa- winds. For the US, the rating agency sees a India and South Africa,” the
tions at 5.6GW during January-September 2023, amid “We have revised up our projection gradual decline in inflation toward the Geneva-based official said,
delay in project execution, according to research firm Mer- for India’s GDP growth for fiscal 2024 US Federal Reserve’s target of 2%. How- without disclosing details of
com India.The installations were also down in the July-Sep- (ending in March 2024) to 6.4%, from ever, it expects another rate hike in the the paper.
tember quarter this year at 1.9GW, a 34% fall, over the 6%, as robust domestic momentum The transitory spike in food inflation, in the July-September quarter, appears to December meeting and the first cut to It was circulated among the
2.8GW solar capacity installed in the same period a year seems to have offset headwinds from have had little effect on the underlying inflation dynamics, the agency noted. HT take place in mid-2024. “In all, the strain WTO members on 24 Novem-
ago, the research firm said. PTI high food inflation and weak exports,” it from higher US interest rates on Asia- ber.
said in a note. investment has recovered considerably The Consumer Price Index (CPI) — or Pacific markets and currencies will The introduction of the
However, it lowered the growth pro- more than private consumer spending, retail inflation—declined to 4.9% in likely persist into 2024,” the note said. paper assumes significance as
‘Work on to remove trade barriers jection for financial year 2025 to 6.4% it added. October after touching a high of 7.4% in For China, S&P Global has raised its India is batting for starting for-
from 6.9% earlier. S&P believes that it will take some July. In its October statement, the Mon- 2023 forecast to 5.4%. It expects China mal negotiations by WTO
in sub-Saharan Africa, Gulf nations’ This reduction comes on the time for India’s interest rate etary Policy Committee had said to grow in line with its potential members to reform the dis-
New Delhi: The commerce ministry is working to address issues back of expectations of cycle to turn as the headline that the near-term inflation in 2024. pute settlement body, as the
related to non-tariff barriers and market access for domestic growth slowing in the sec- inflation still remains above outlook is expected to “China’s outlook has present informal deliberations
products in sub-Saharan African countries like Nigeria, Ethiopia,
Ghana and Gulf nations to boost India’s exports, an official said.
ond half of the year amid
subdued global growth, a 6.4%
growth projection
the RBI’s target of 4%. improve on the back of
“In India, there was a vegetable price correc-
growth projection
improved, but obstacles
remain. With the prop- 6.4% are creating hindrances for
several nations to participate
The official said meetings have been held with Indian missions higher base and a lagged transitory spike in food tions and a reduction in erty sector struggling and in the talks.
of the sub-Saharan African countries with which India has signifi- impact of interest rate for FY24—revised inflation in the July-Sep- cooking gas prices. for FY25—revised confidence subdued, the WTO’s dispute settlement
cant bilateral trade. PTI hikes effected by the upward from 6% tember quarter, but it S&P Global said India’s down from 6.9% growth outlook remains body (DSB) is one of the
Reserve Bank of India. appears to have had little manufacturing gauge eased moderate,” it said. A prop- important arms of the 164-
S&P’s FY25 GDP growth effect on the underlying infla- during October, but at above erty downturn is still a pain member Geneva-based body.
EC stops poll-bound Telangana prediction is lower than the RBI’s tion dynamics,” the note said. It 55 it remained stronger than point for the Chinese economy, Besides monitoring global
projection of 6.6%. expects interest rates to fall by 100 basis many developed countries. but growth momentum has slightly exports and import-related
govt from disbursing farmer aid The agency noted that India’s GDP points by March 2024. India’s manufacturing activity in improved because of policy support, it rules, it adjudicates trade dis-
MINT
exceeded the 2019 level by 15.5% in the One basis point is one-hundredth of a October grew at the slowest pace in added. putes between the member
first half of the current fiscal. Also, fixed percentage point. eight months, dragged down by slowing Rhik Kundu contributed to the story countries.

Rupee fluctuation a Another jump likely in budget for roads

problem, says FM Subhash Narayan
subhash.narayan@livemint.com
be considered for this critical
sector that is also in midst of
NEW DELHI expanding the network of large
Rhik Kundu ing Indian exports, she added. sized expressways like the Del-

T
New Delhi: In a stern message, the Election Commission on rhik.kundu@livemint.com The International Monetary he government proposes hi-Mumbai Expressway, work
Monday withdrew permission given to the Telangana gov- NEW DELHI Fund has raised its FY2024 to remain focussed on on which has already started.
ernment for disbursements of financial aid to farmers for rabi growth projection for India to rapid infrastructure It has also to complete the

T
crops under the Rythu Bandhu Scheme after a state minister he government is keep- 6.3% from its July estimate of growth in the next financial Bharatmala highway project
violated the provisions of the model code by making a public ing a continuous watch 6.1%, citing stronger-than-ex- year and may even allow that envisages construction of
announcement about it.The poll panel had given its nod to on the exchange rate, pected consumption during another big increase of 20-25% 34,800 km of roads connecting
the state government to disburse the rabi instalment during particularly after the slide of the first quarter. in capex allocations for the economic centres including
the model code of conduct period on certain conditions. The the rupee, finance minister However, India’s merchan- roads ministry in order to speed ports, railway hubs and inland
state was asked not to publicize the disbursement during the Nirmala Sitharaman said on dise trade deficit widened to a up road construction, two per- waterway stations.
poll code as part of the condition. PTI Monday, describing exchange record high in October because sons aware of the plans said. The cost estimates for Bhar-
rate fluctuations and high-in- of a sharp rise in gold imports A substantial portion of atmala-I project, conceived in
terest rates as downsides for the during the festive season and a higher allocation would also go 2017 has doubled from the ini-
Lightning strikes kill 27 in Gujarat, Indian economy. higher oil bill. toward meeting the capital A big increase of 20-25% in capex allocations is expected for tial ₹5 trillion to over ₹10 tril-
Speaking vir- According to expenditure of the National highway development in the next fiscal. lion now, which would require
government to assess damage tually at the India Sitharaman said the commerce Highways Authority of India
MINT
more funds with MoRTH and
Ahmedabad: At least 27 people have been killed in multiple Global Forum high-interest ministry, India’s (NHAI), which, having been put announced in the interim bud- A higher allocation for NHAI.
lightning strikes in Gujarat as widespread unseasonal rainfall bat- held in the UAE, rates, in advanced trade deficit wid- on a moratorium for market get to be presented in Parlia- MoRTH for FY25 would build The project is now estimated
tered the state, damaging homes and standing crops, officials said Sitharaman said countries, “will ened to $31.46 bil- borrowings for the past couple ment in February, the person upon a 25% rise in capex for the to be completed by FY28. Also,
on Monday. The lightning-related deaths occurred in a span of high-interest
have a bearing on lion in October, of years, is now being funded said, adding that MoRTH has ministry in FY24 when alloca- MoRTH is finalizing a Vision
24 hours beginning on early Sunday morning, they said. PTI rates, especially with imports at entirely by the government. already indicated the numbers tions rose from a level of ₹2.06 2047 document that would
in advanced investments $65.03 billion and One of the persons cited in its pre-budget trillion (revised bring forward new alignments
countries, “will into India” exports at $33.57 above said that a 25% increase consultations. A 25% increase estimate) in FY23 of about 30,000 km of con-
India needs Global South partners have a bearing on billion. in capex for ministry of road The numbers in capex to ₹2.58 trillion in trolled highways for bidding,
investments into While Indian transport and highways may see some FY24. Prior to requiring additional invest-
to become developed nation: Kant India.” exports remain a concern, (MoRTH) will take its budget to revision when full
for MoRTH
that, the capex for ments of over ₹20 trillion.
will take its
New Delhi: The country needs to work in partnership with Global “The domestic market and high-interest rates, especially over ₹3.2 trillion, the highest- budget is pre- road and high- An infrastructure sector
South to accelerate its growth rate to achieve the dream of Viksit our macroeconomic funda- in advanced economies, have ever. sented by the new
budget to
ways increased by expert from one of the four big
Bharat (developed India) by 2047, G20 sherpa Amitabh Kant said mentals are fairly well-rooted. impacted investments as the This would allow it to build government at over ₹3.2 trillion, a historic 82% global audit firms said on con-
on Monday. The next two decades are said to be the most signifi- India is comfortably placed cost of borrowing and servicing more greenfield highways and the Centre early the highest-ever from ₹1.13 trillion dition of anonymity that higher
cant of India’s growth story, he said while speaking at the First because of our stable policy and interests has risen. expressways, giving a leg-up to in the second half (actuals) in FY22. government allocation for the
Regional Conference on Access to Legal Aid. According to a Niti predictable tax domains, but Earlier in November, the US transport infrastructure that is of 2024 calendar The persons sector would only be beneficial
Aayog roadmap, India would be a developed country with a factors outside are not in our Federal Reserve held the key key to propelling economic year, he added. quoted above said that though if the money goes into capital
₹30-trillion economy by 2047. “If this level of sustained growth control,” Sitharaman said. interest rate in a target range growth. Queries sent to MoRTH this would be sufficient to expenditure rather than paying
that we aim to achieve and opportunities must now catalyze this, Falling consumption in between 5.25%-5.5%, where it The higher capex for the remained unanswered at press speed up highway develop- salaries or providing populist
we need to work in partnership with Global South,” he said. PTI advanced economies is impact- has been since July. roads ministry may be time. ment, more allocation should subsidies.

Dark pattern guidelines to prescribe penalty for erring digital firms CORRECTIONS AND
CLARIFICATIONS
Mint welcomes comments,
Puja Das & The government decided to punished. But sometimes even time. which are yet unclear.” suggestions or complaints
Gireesh Chandra Prasad specify the penalties because e-commerce players may not Experts described the regu- Elaborating on how dark about errors.
the underlying consumer pro- be aware of it,” said the official lations as a step in the right patterns work, Ranjan said
Readers can alert the
NEW DELHI tection law does not specifi- mentioned above. direction. marketing strategies of digital
newsroom to any errors in the
cally name ‘dark patterns’ as an “To give clarity to both busi- “Hopefully, the final guide- businesses are often premised paper by emailing us, with your

T
he government is set to
specify penalties for
e-commerce companies
misleading consumers into
taking unintended decisions,
as it tightens regulations on
unfair trade practices by digi-
tal businesses.
The guidelines for what’s
known in the industry as dark
patterns, or deceptive pat-
terns, are expected in a matter
of weeks, said an official
informed about the develop-
ment.
unfair practice, although it has
a broad scope and covers all
deceptive practices and mis-
representations.
This will not only give
e-commerce companies clar-
ity on the consequences of
indulging in misleading trade
practices, but also make it eas-
ier for courts to deal with con-
sumer complaints.
Dark patterns are designed
to manipulate users into buy-
ing a more expensive product,
paying more than initially dis-
nesses and consumers about
the applicable penalty for such
unfair trade practices, the
guidelines will specify that. It
will also make it easier for
courts.”
The guidelines, framed fol-
Nudging consumers online in a direction where they do not want lowing consultation with the
to go is an unfair practice. GETTY IMAGESI industry and public feedback,
will be issued shortly, the offi-
closed, sharing data, or mak- practice. Nudging a consumer cial said.
ing choices based on false or in a direction where he does Queries sent to the depart-
paid-for reviews. not want to go is an unfair ment of consumer affairs and
“Dark pattern comes under practice. If anyone goes to the ministry of law and justice
the umbrella of unfair trade court, the perpetrator will be remained unanswered at press
lines that will be implemented on consumer psychology. full name and address to
will build in compliance “Dark patterns have evolved feedback@livemint.com.
mechanisms and reporting based on research which dem-
requirements in a balanced onstrates that consumers may It is our policy to promptly
respond to all complaints.
manner, enabling effective be manipulated into making Readers dissatisfied with the
tracking of dark patterns, unintended choices and pur- response or concerned about
while also not burdening busi- chases,” said Ranjan. Mint’s journalistic integrity may
ness operations,” said Sweta Digital marketplaces are write directly to the editor by
Ranjan, partner at law firm constantly evolving and the sending an email to
Economic Laws Practice list of dark patterns in the asktheeditor@livemint.com
(ELP). guidelines would need to be Mint’s journalistic Code of
“The effectiveness of the regularly updated, said Sanya Conduct that governs our
proposals would depend on Sud, principal associate at law newsroom is available at
their implementation and firm Saraf & Partners. www.livemint.com
compliance mechanisms, puja.das@livemint.com

FOR ANY QUERIES/DELIVERY ISSUES

CALL: 60004242, Monday-Saturday, 10am-6pm (Delhi, Mumbai, Bengaluru, Kolkata, Chennai, Hyderabad, Ahmedabad, Chandigarh, Pune and Lucknow) MAIL: delivery@livemint.com TO SUBSCRIBE: Give a missed call on 7039035039 or visit www.mintreaders.com or write to us at subscription@livemint.com

First published in February 2007 to serve as an unbiased and clear-minded chronicler of the Indian Dream.
RAVI KRISHNAN (EDITOR); PUBLISHED/PRINTED BY MANHAR KAPOOR ON BEHALF OF HT MEDIA LTD, 18-20 Kasturba Gandhi Marg, New Delhi 110001
Printed at HT Media Ltd presses at •Plot No. 8, Udyog Vihar, Greater Noida, Distt Gautam Budh Nagar, Uttar Pradesh 201306; •MNSPrinters Pvt. Ltd, 345/4, Bhatrahalli, Near KR Puram RTO, Old Madras Road, Bangalore 560049; •Saraswati Print Factory Pvt. Ltd, 789, Chowbhaga (W), Near China Mandir, Kolkata 700 105; •MNSPrinters Pvt. Ltd, 76/1, Poonamallee High Road, Velappanchavadi, Chennai 600077; •
Bhaskar Print Planet, Survey No. 148P, Changodar Bavla Highway, Sanand (Tal), Distt Ahmedabad, Gujarat. •Jagati Publications Ltd, Plot No. D75 & E52, APIE Industrial Estate, Balanagar, Rangareddy Distt. Hyderabad 500037 *Also available in Chandigarh, Pune and Lucknow.
RNI Registration DELENG/2007/22485; Mint welcomes readers’ responses to all articles and editorials. Please include your full name, address and telephone number. Send in your views to the editor at letters@livemint.com. ©2023 HT Media Ltd All Rights Reserved
LIVEMINT.COM DEALS, TECH & STARTUPS TuesDay, 28 November 2023
New Delhi 03

m MINT SHORTS
Proptech startup Elivaas raises
True North credit fund
seed funding of ₹20.8 crore
Bengaluru: Elivaas has raised $2.5 million (₹20.8 crore) in a
seed funding round led by Surge, the rapid scale-up programme
of venture capital firm Peak XV Partners (formerly Sequoia
raises ₹1,000 crore
India and Southeast Asia). The round also saw participation
from a host of angel investors including Naveen Kukreja (Paisa-
bazaar), Kunal Shah (Cred), Mohit Gupta (Zomato), Amit Lakho-
tia (Park+), Ravi Singhvi, (Ares Asia), Parag Aggarwal (Gobolt) The fund is raising capital from Indian UHNIs and family offices
and Toranj Mehta (De beers), among others. The startup will
use the funds to develop its technology stack and expand its
presence across India. Ranjani Raghavan & Sneha Shah
mumbAi

T
Frendy secures bridge funding rue North, the homegrown pri-
vate equity firm with assets
from Auxano Capital, others under management of over $3
ISTOCKPHOTO
billion, has raised ₹1,000 crore
towards its maiden credit fund,
marking its foray into a second asset class,
two senior executives told Mint.
The credit fund that is raising capital
from Indian ultra high net worth individu-
als (UHNIs) and family offices, will deploy
the capital over the next five years, and is
targeting a 15-18% internal rate of return
(IRR), Vishal Nevatia, founder and manag-
Alibaba’s quantum
ing partner, True North and Kapil Singhal,
managing partner at True North’s private
credit unit, said. The firm expects to close
computing lab shut
Bengaluru: Frendy has raised around $2 million (₹16 the credit fund with ₹1,300-1,400 crore of
crore) in a bridge funding round led by Auxano Capital. capital by December. Bloomberg announced they were killing
The round also saw participation from AT Capital Singa- True North has so far raised six private feedback@livemint.com the much-anticipated spinoff
pore, Metara Ventures, Apurva Salarpuria family office equity funds and has looked at a second and listing of the cloud services

A
and existing investor Desai Ventures. The Ahmedabad- asset class to complement its private equity Kapil Singhal, managing partner at True North’s Private credit unit. libaba Group Holding division, an about-face that
based startup also plans to extend the round up to ₹24 business for over the last five years. It closed Ltd has shuttered its spurred speculation about
crore via a follow-on rights issue, it said in a statement. its 6th private equity fund at $600 million Through its credit fund, True North will “For such transactions, we can offer agile quantum computing other changes to Alibaba’s
The capital raised will be utilized to expand the tech offer- in 2020. Through its private equity unit, it look to bridge the supply-demand gaps for and tailored solutions. Because it is expen- research lab, a sign that the long-term roadmap.
ing, private label product portfolio and expand the num- has so far invested in over 70 businesses middle-market companies and offer capital sive, it doesn’t make sense for the borrow- Chinese e-commerce and Before that surprise deci-
ber of stores. Founded by Sameer Gandotra, Gowrav Vish- over the last 24 years across consumer, solutions for shorter tenures. The fund is ers to keep this for a long time,” he added. cloud operator is considering sion, the firm was in the midst a
wakarma and Harshad Joshi, Frendy is an omnichannel financial services, healthcare, and technol- likely to tap businesses that are generating The fund will back only profitable cash- more cutbacks to bulk up the complicated six-way split that
convenience store network focused on smaller towns and ogy sectors and made around 50 exits, gen- a revenue of ₹300-400 crore, to up to flow generating businesses, Nevatia added. bottom line. would break the company up
rural India. In terms of its financials, the company said erating a cumulative return of 23-24% IRR ₹1,500 crore turnover. These are likely to be performing busi- Alibaba will donate its equip- into component businesses
that it managed to clock ₹82 crore in revenue in FY23, up in local currency. “The performing credit strategy is built nesses that are unable to go to a bank for ment to Zhejiang University in from commerce and entertain-
from ₹40 crore in FY22. It considered areas such as specific reasons, he said. Hangzhou, where the company ment to logistics.
venture capital, real estate, BRIDGING THE GAP “They may need support for is based, a company spokesper- Last week, Tsai and Wu took
distressed assets and growth two to three years before they son said Monday. The lab’s clo- the first steps toward revamp-
Woovly raises funds from Sony stage PE before deciding that THE firm expects to THROuGH its credit THE fund is likely can go back to a proper bank sure will result in the loss of ing the cloud arm, which has
credit would be the best natu- close the credit fund fund, True North will to tap businesses for refinancing. We can help about 30 staff, some of whom been bleeding market share to
Innovation Fund and others ral extension for the firm.
with ₹1,300-1,400 look to bridge the that are generating
them for two to three years— Alibaba may help find positions state-backed rivals. The com-
crore of capital supply-demand gaps a revenue of
Bengaluru: Woovly has raised an undisclosed amount in a “We felt that credit would be by December for middle-mkt firms ₹300-400 crore by then, they will also fit the at the same college, a person pany appointed three new
funding round from a host of investors including Sony Innova- a very attractive and a large bank’s evaluation criteria,” familiar with the matter said, executives to head up major
tion Fund, RTAF, ViNners and existing investor SOSV. The Ben- opportunity in India over the Nevatia said. asking to remain unidentified business lines within Alibaba
galuru-based startup plans to use the funding to improve its plat- next 10-20 years. It has gone through an on structural inflexibility of the banks to do The fund is focusing on the middle mar- discussing private decisions. Cloud, with two reporting
form, expand its presence geographically as well as explore new early period of stress and eventually come a certain kind of transactions i.e. tenor ket businesses that are generating a reve- China’s e-commerce leader directly to chief executive offi-
market segments such as fashion, home decor, and lifestyle cate- through—we think private credit is where elongation, structured repayment sched- nue of around ₹300-400 crore upwards, is in the middle of an overhaul cer Wu.
gories. Founded in 2017 by Neha Suyal and J Venkat, Woovly is private equity was 15 years ago,” Nevatia said. ules, domestic acquisition financing etc. up to ₹1,500 crore turnover with ticket size spearheaded by Joseph Tsai The DAMO Academy was
a social commerce platform focused on Tier 2, 3 millennials. Singhal joined True North in late 2021 to Sometimes, it is also banks’ inability to act ranging from ₹75 cr in the fund and up to and Eddie Wu, two confidantes supposed to be Alibaba’s
Woovly users can discover and shop lifestyle products through set up True North’s credit team, which now with speed; other times it is also the practi- ₹200 cr including the co-investment pools, of co-founder Jack Ma who “moonshot” division, responsi-
short video content created by micro/nano influencers. has eight investment professionals and cal limitations that banks have i.e. financ- Singhal said. took over the company in Sep- ble for exploring and delivering
COMPILED BY K. AMOGHAVARSHA analysts. ing asset light businesses,” Singhal said. ranjani.raghavan@livemint.com tember. This month, the pair on cutting-edge technologies.
04 TuesDay, 28 November 2023
New Delhi MARK TO MARKET LIVEMINT.COM

S&P BSE Sensex Nifty 50 Nifty 500 Nifty Next 50 Nifty 100 S&P BSE Mid-cap S&P BSE Small Cap
ClOsE 1-WEEK CHANGE (%) ClOsE 1-WEEK CHANGE (%) ClOsE 1-WEEK CHANGE (%) ClOsE 1-WEEK CHANGE (%) ClOsE 1-WEEK CHANGE (%) ClOsE 1-WEEK CHANGE (%) ClOsE 1-WEEK CHANGE (%)

65970.04 0.27 19794.70 0.32 17643.50 0.24 46607.75 -0.49 19812.10 0.20 33610.39 0.69 39807.29 0.53
1-MONTH CHANGE (%) 3-MONTH CHANGE (%) 1-MONTH CHANGE (%) 3-MONTH CHANGE (%) 1-MONTH CHANGE (%) 3-MONTH CHANGE (%) 1-MONTH CHANGE (%) 3-MONTH CHANGE (%) 1-MONTH CHANGE (%) 3-MONTH CHANGE (%) 1-MONTH CHANGE (%) 3-MONTH CHANGE (%) 1-MONTH CHANGE (%) 3-MONTH CHANGE (%)

2.17 1.10 2.66 2.10 4.47 4.21 6.69 4.73 3.25 2.53 8.13 8.49 8.75 10.14
6-MONTH CHANGE (%) 1-YEAR CHANGE (%) 6-MONTH CHANGE (%) 1-YEAR CHANGE (%) 6-MONTH CHANGE (%) 1-YEAR CHANGE (%) 6-MONTH CHANGE (%) 1-YEAR CHANGE (%) 6-MONTH CHANGE (%) 1-YEAR CHANGE (%) 6-MONTH CHANGE (%) 1-YEAR CHANGE (%) 6-MONTH CHANGE (%) 1-YEAR CHANGE (%)

6.79 5.94 8.25 7.09 13.71 12.52 13.72 9.11 9.04 6.36 26.89 32.33 32.98 37.26

m MINT SHORTS FMCG firms may be Oberoi Realty moves

Bond mkt’s recovery is seen as in the right direction
opening act for broader revival
The world’s biggest bond market has clawed its way back
after spending chunks of 2023 underwater. Now many
US debt watchers see the pathway clearing for a real
running out of steam to impress investors
revival. The Bloomberg US Treasury Index shifted earlier Vineetha Sampath & Pallavi Pengonda Harsha Jethmalani
Getting healthier Gaining grip
this month to a positive return for the year as signs of bengALUrU/mUmbAi harsha.j@htlive.com
slowing inflation and measured jobs growth unleashed Consumer staples companies saw Oberoi Realty stock has

S
gross margin expansion for the third underperformed Nifty Realty index

O
a rally that sent benchmark yields tumbling from their oftening raw material prices consecutive quarter in Q2FY24
beroi Realty Ltd has grabbed so far in 2023, albeit marginally.
highest in more than a decade. There have been some boosted the profit margins of investors’ attention of late,
Gross profit Year-on-year change Oberoi Realty Nifty Realty
reversals along the way but the index is still about where Indian listed fast-moving con- margin (in %) (in basis points) (right-hand scale) and for all the right reasons.
180
it was at the start of the year and the overarching tone is sumer goods companies in the 60 600 Shares of the Mumbai-based real estate
constructive. Most Wall Street strategists are predicting September quarter (Q2FY24), developer climbed to a new 52-week 162.80
that the trend of lower yields will persist and set the stage as was expected. Aggregate gross margin 50 400
high of ₹1,415 on 21 November in 160.14
160
for broad-based gains in 2024, with longer-term rates expansion for FMCG companies under response to two crucial developments.
moving down more gradually given the barrage of debt Nomura’s coverage stood at 505 basis The company announced the
40 200
issuance needed to fund an out-sized US deficit. Of points year-on-year, rising to 51.6%—the launch of its much-awaited luxury
140
course, many of these same market experts were fore- highest in at least nine quarters. residential project Forestville in the
casting a big year for bonds in 2023. BLOOMBERG This left room for companies to step up 30 0 Kolshet area of Thane, near Mumbai.
their advertising budgets. Accordingly, The project will be spread across 18
120
Ebitda margin expansion was compara- 20 -200 acres and consist of five residential
tively slower than the gain at the gross mar- towers, predominantly with 3-BHK
gin level. Ebitda is earnings before interest, 10 -400 apartments starting at ₹1.87 crore.
taxes, depreciation, and amortization. Recall that the delayed launch of 100

But while these have helped with prof- 0 -600 Thane projects (Kolshet and Pokhran)
itability, the revenue and volume per- Q2FY22 Q2FY24 was seen as an overhang for the stock.
formances of these companies are noth- Note: Aggregate margin of consumer staples companies The Pokhran Road project is now 80
under Nomura's coverage; one basis point is 0.01% 30 Dec 2022 24 Nov 2023
ing to write home about, in contrast with The valuations of key FMCG stocks Source: Company data, Nomura Research
expected to be launched in Q4FY24.
Values rebased to 100 Source: Capitaline
the overall industry performance. hardly offer comfort. MINT The company has also forayed into
“While overall FMCG market volume PRANAY BHARDWAJ/MINT
the National Capital Region (NCR) by SATISH KUMAR/MINT

growth improved marginally quarter-on- this has to be majorly volume-led. HUL has ing, and the likelihood of more govern- acquiring a 14.8-acre plot valued at on 20 November. That said, more
quarter (8.6% year-on-year in Q2FY24 said if commodity prices remain stable, ment measures ahead of elections. ₹597 crore in Gurugram from Ireo clarity on timelines and pricing is
versus 7.5% in Q1FY24) the demand was pricing growth can be expected to be The lack of clarity is captured to some Residences Co. Pvt Ltd and others. It needed to gauge the impact on
slower than expected for organised players slightly negative in the near term. Q3 could extent in stock performances. Shares of plans to develop a luxury group hous- Oberoi’s pre-sales growth.
(2.2% year-on-year in Q2FY24 versus 4.1% get a boost from the shift in the festive sea- companies with vast exposure to rural ing project there. At a time when its The company’s stock has rallied by
in Q1FY24),” wrote Mihir Shah, analyst at son, but after that the picture is blurry. markets, such as HUL and Dabur, are peers are expanding their footprint, an impressive 60% this year but it still
The one-month Hong Kong interbank offered rate rose Nomura Financial Advisory and Securities “Unorganised players may continue to down 2-4% so far this year. Marico’s stock geographical diversification is cer- lags the Nifty Realty index, albeit mar-
15 bps to 5.53%, the highest since October 2007. REUTERS (India) in a report on 20 November. gain strength, especially in highly pene- rose by a mere 3%, significantly lagging tainly a positive for Oberoi Realty. ginally. A meaningful upside from
This, he said, was due to softening raw trated categories such as tea, soaps and the Nifty FMCG index. These developments followed a current levels depends upon the pace
material prices making the products of detergents, until there is a sufficient price On the profitability front, while gross muted September quarter (Q2FY24) of launches and inventory exhaustion
HK cash demand sends local unorganised players “more affordable for pass-on by organised players,” said margin is likely to remain elevated, com- for the company, during for existing projects. In
bank rate to 16-year high value-seeking consumers”. panies are expected to which its year-on-year A meaningful the Q2 earnings call, the
A gauge of bank funding costs in Hong Kong jumped to Demand in urban mar- CLOudy OutLOOK invest those gains towards pre-sales growth was upside in the management said it
the highest in 16 years, as year-end demand for cash exac- kets was decent. But this marketing to tackle affected by a lack of new stock from planned to launch new
erbates an already-tight liquidity environment. The one- was not enough as rural Q3 could get a boost WHiLE firms seem SHaRES of cos with increased competition. This launches. So, the excite- hereon hinges on phases in the Elysian and
month Hong Kong interbank offered rate, or Hibor, rose demand was subdued from the shift in the optimistic about vast exposure to will weigh on Ebitda margin ment among investors is Borivali projects in the
festive season, rural demand revival, rural markets, like launches and
15 basis points to 5.53%, the highest since October 2007. owing to an uneven mon- but after that the the pace of recovery HUL and Dabur, are outlook. “There were more understandable as these second of FY24, and that
Demand for the local currency is on the rise as lenders soon, the shift in the festive picture is blurry remains to be seen down 2-4% this year earnings cuts than upgrades developments are inventory the Borivali mall, Com-
stockpile cash for regulatory purposes, sucking capital season this year, and ele- for FY2024-26E due to a expected to boost its exhaustion merz III and the Ritz
from the interbank system. While the supply of cash vated inflation levels. Plus, weak growth outlook near-term growth. Carlton hotel should be
often tightens toward the end of a year, swings in Hong pricing-led tailwinds have diminished for Sachin Bobade, an analyst at Dolat Capi- (delayed rural recovery) in staples,” Kotak Analysts note that commissioned in 2024.
Kong funding costs in the last month of 2023 may be companies with the base becoming tal. This could lead to a loss of market Institutional Equities said in a Q2 review location of its Gurugram plot is likely It also said it expects to sell its entire
more than usual. That’s because the pool of liquidity in larger. Cumulatively, this took a toll on share for listed companies. report on consumer staples. to be favourable for a luxury project in inventory in the Mulund projects in
the city has shrunk to the lowest in more than a decade, revenue growth. Hindustan Unilever Ltd Further, the pick up in rural demand The valuations of key FMCG stocks terms of pricing and demand. “The the next two years.
at least according to one gauge. “Front-end Hong Kong (HUL) and Britannia Industries Ltd saw could be gradual at best. While companies hardly offer comfort. Shares of HUL, Mar- land is adjacent to the Grand Hyatt A comforting factor is that the com-
dollar rates have further headroom due to seasonal fund- year-on-year Q2 revenue growth in the seem optimistic about a revival in rural ico and Britannia trade at 40-48 times and a retail component developed by pany’s net debt eased sequentially in
ing need,” said Cindy Keung, an economist at OCBC Bank range of 1-4%, while for Marico Ltd it was demand, the pace of recovery remains to their FY25 estimated earnings, according erstwhile developer Ireo, which will Q2FY24, aided by robust cash flows.
(Hong Kong) Ltd. “Bias for the US dollar-Hong Kong dol- down by nearly 1%. be seen. Dabur India Ltd expects rural to Bloomberg data. These multiples are enhance the value of Oberoi’s resi- That said, aggressive business devel-
lar pair remains to the downside on rates differentials,” What’s more, there are not enough tail- markets to gain traction with hikes in min- not exactly cheap given the risks. dential development,” said Motilal opment deals and new land acquisi-
Keung added. BLOOMBERG winds for significant revenue growth as imum support price, good rabi crop sow- vineetha.s@livemint.com Oswal Financial Services in a report tions could keep debt elevated.

Mark to Market writers do not have positions in the companies they have discussed here

FPI debt inflows at 26-month Over $10 bn

inflow into
MINT MACRO TRACKER
high in Nov on Fed rate pause Launched in October 2018, Mint’s macro tracker provides a monthly comprehensive report

emerging
on the state of the economy, based on trends in 16 high-frequency indicators. For each
indicator, the value in each month is assigned a colour-coding (red, amber and green) to
denote where it lies relative to the five-year average (worse, in line, or better). As of October,
Ram Sahgal said Madan Sabnavis, chief
Rising tide eight of the 16 indicators were in green, four in red, and four in amber—an improvement from

mkt ETFs
Now 1 month ago 2 months ago 4 months ago 6 months ago
ram.sahgal@livemint.com economist, Bank of Baroda. six months ago.
mUmbAi
FPIs have invested a net ₹12,399 Sabnavis believes that FPI
crore in Indian debt
flows into Indian debt markets
Bloomberg

F
FPI debt inflows in current fiscal (FY24)
PI net inflows into Indian (in  crore)
would continue to stay posi- CONSUMER ECONOMY PRODUCER ECONOMY
bonds in November have 15,000 tive but that there could be feedback@livemint.com
hit the highest level in 26 volatility on the upside. For Passenger vehicle sales Tractor sales PMI composite Core* output
(y-o-y change, %) (y-o-y change, %)

A
(y-o-y change, %)
months, thanks to higher allo- 12,000 e.g., one month might see $1.7 trillion equity rally 30 30 62 15
cations by foreign investors to flows jump and the next might and the best bond gains 20 -4.6 20 -4.3 60
58.4 12 8.2
10 58
emerging markets like India in see lesser inflows . in a year in emerging 0
10
56 9
9,000
anticipation of US interest “While there would be vola- markets got a vote of confi- -10 0 54 6
-10 3
rates having peaked and buy- tility on the upside, we might dence from investors in US -20 52
6,000 -30 -20 50 0
ing by non-index funds ahead not witness any FPI outflows exchange-traded funds who Nov 2022 Sep 2023
Nov 2022 Oct 2023 Nov 2022 Oct 2023 Nov 2022 Oct 2023
of the country’s inclusion in JP from Indian debt,” added brought in fresh deposits last *8 core infrastructure industries
Morgan’s Global Bond Index - 3,000 Sabnavis. week, taking 2023 inflows
Broadband subscriber base Domestic air passengers Banks’ non-food credit Rail freight traffic
Emerging Markets next year. Indeed, the benchmark US above $10 billion. (y-o-y change, %) (y-o-y change, %) (y-o-y change, %) (y-o-y change, %)
Analysts expect the flows to 0 10-year bond yield has fallen Net deposits into ETFs that 25 100 20 10
8.5
Apr Nov* 7.7 10.8 17.6 8
remain strong, though vola- by 0.4% in the past one month invest across developing 20 75 15 6
*Up to 24 Nov Source: NSDL 15
tile. to 4.47%. This is also signifi- nations as well as those that 50 10 4
SATISH KUMAR/MINT 10
FPIs have in the month cantly below the 16-year high target specific countries tot- 5 25 5
2
0
through 24 November cides with the US Fed leaving of 5% hit last month. aled $766.1 million in the week 0 0 0 -2
invested a net ₹12,399 crore in its benchmark Fed Funds Rate The yield on the Indian ended 24 November, building Nov 2022 Aug 2023 Nov 2022 Oct 2023 Nov 2022 Sep 2023 Nov 2022 Oct 2023
Indian debt, the highest quan- unchanged at 5.25% on 1 10-year paper has cooled off by on gains of $1.57 billion in the
tum since September 2021, November for a second a higher 1.5% to 7.27% over the previous week, according to
when they pumped in ₹12,804 straight policy meeting and same period, attracting invest- data compiled by the
crore. Net inflows in Novem- data this month which shows ments from foreigners as bond Bloomberg team. So far this EXTERNAL SECTOR EASE OF LIVING
ber account for almost 28% of that retail inflation in US prices and yields move in year, inflows have totalled Import cover Rupee vs dollar CPI inflation Core CPI inflation
total ₹44,438 crore invested so cooled off to 3.24% in October opposite direction. $10.1 billion. (forex reserves in months) (m-o-m change, %) (y-o-y, %) (y-o-y, %)
far this fiscal, the highest in six from 3.7% a month ago and UR Bhat, founder of Emerging-market assets are 14 1 8 4.9 7 4.3
10.6 -0.2
years. was below the historic average Alphaniti Fintech, said apart heading for the biggest 0.5 7
12 6
Their investments are pri- of 3.28%. from US markets pricing in a monthly gains since January 0 6
marily into central govern- Economists and market more dovish Fed stance on since easing US inflation 10 -0.5 5 5

ment and corporate bonds,
shows NSDL data. Indeed, the
depository data shows that
utilisation limits by general
category of foreign investors
has increased to 24.22% or
₹64,895 crore of the upper
limit as of 24 November from
23.1% or ₹61,880 crore as of
31 October.
In the case of corporate
bonds also they have increased
their buying a tad to 15.43% or
₹1.03 trillion as of 24 Novem-
ber from 15.29% or ₹1.02 tril-
lion on 31 October.
The increased buying coin-
experts view the easing of US rates, buying of Indian paper boosted wagers the Fed has 8 -1 4 4
inflation as a lagged effect of 11 was being fuelled by demand reached the peak of its mone- Nov 2022 Oct 2023 Nov 2022 Oct 2023 Nov 2022 Oct 2023 Nov 2022 Oct 2023
consecutive rate hikes by the from non-index funds ahead of tary-tightening cycle and may
Fed from March last year to India’s inclusion into the even cut rates in 2024. Labour-intensive sector exports Trade balance Real rural wages Labour force participation rate
July 2023. GBI-EM. Stocks have rallied for four (y-o-y change, %) (as a % of total trade) (y-o-y change, %) (in %)
10 -5.8 0 -31.9 2 42
They believe that moderat- “Passive trackers like bond successive weeks, while sover- 2 41.7
0 -10 41
ing retail inflation would pre- funds and debt ETFs will buy eign bond yields have shed 84 1
-10 -20 40
empt the Fed from tightening Indian paper coinciding with basis points on an average 0
-20 -30 39
rates further and that this its inclusion in JP Morgan since late October. Carry
-30 -40 -1 38
would result in bond yields in bond index in June next year. returns are improving as 19 of
Nov 2022 Oct 2023 Nov 2022 Oct 2023 Nov 2022 May 2023 Nov 2022 Oct 2023
US falling and more alloca- But, non-index funds could 30 widely traded developing-
tions to EMs like India. have begun picking up Indian nation currencies head for For each indicator, an average band (shown in grey) is constructed around the five-year average value. The size of the grey band rises with volatility. Values falling above this band
“Higher inflows by FPIs into government paper in advance monthly rallies. are in green, those falling below are red, and those within this band are coded amber (the red/green coding is reversed for inflation). While calculating the five-year average, data for
some indicators for April-May 2020 and 2021 have been removed to eliminate lockdown-induced skews in the trend. All data as of 22 November 2023.
Indian debt are being driven to make a killing from an antic- On Monday, equity markets
Source: Centre for Monitoring Indian Economy, Bloomberg, Mint calculations
by moderating bond yields in ipated fall in yields when the were little changed as con-
the US with inflation easing country is actually included in cerns about China’s economic Data: Tanay Sukumar; Graphics: Paras Jain
toward the Fed’s 2% target,” the bond index,” Bhat said. recovery returned.
LIVEMINT.COM CORPORATE TuesDay, 28 November 2023
New Delhi 05

Byju’s penalized over Maruti sets stage for price hikes in 2024
Alisha Sachdev hike and exact details over the

IAS ads, set to appeal next few weeks.

alisha.sachdev@livemint.com
NEw DElhI “We are giving notice to
customers who’ve made book-

I
ndia’s largest carmaker
Maruti Suzuki India Ltd on
Monday said it will raise pri-
ces beginning 1 January, set-
ting the stage for similar hikes
Compliance report sought in 15 days; Byju’s has to appeal before NCDRC by rival automakers. The com-
pany attributed the move to
higher commodity costs and
Dhirendra Kumar steep inflation, but did not
dhirendra.kumar@livemint.com specify the quantum of price
NEw DElhI hike for specific models.
“Steel prices have firmed up
ings with us that we are taking
price hikes. In some models,
the price hikes will be substan-
tial. Our last price increase was
in April this year at 0.8%. In
2022, we took two price hikes
at 1.3% in April and 1.1% in Jan-
uary,” Maruti’s Srivastava said.
“Material cost constitutes
approximately 70-75% of net
sales among carmakers and
Maruti Suzuki attributed the hike in prices of its models to higher any change in the material cost

T
he Central Consumer Protection a little over the last three-four commodity costs and inflation, but did not share specifics. MINT directly impacts the cost struc-
Authority (CCPA) has imposed a months, which accounts for ture. The recent hike in steel
penalty of ₹10 lakh on edtech around 38% of our commodity model year changeover, or the stantly monitoring input eco- prices is expected to put pres-
platform Byju’s for publishing buying. We have been esti- new financial year. Executives nomic parameters playing out sure on the cost and push vehi-
allegedly false and misleading mating the impact of the vola- of other automakers also con- in the market and any decision cle makers to hike vehicle pri-
advertisements for its online IAS (Indian tility of commodity prices on firmed their price hike plans. regarding price adjustments ces. We need to watch how
Administrative Service) coaching offering. our costs, and trying to cut “Based on the inflation and will be made after careful con- carmakers manage the trade-
CCPA had taken suo moto cognisance of costs internally and then take commodity prices outlook, we sideration of the prevailing off between price hikes and
the issue in 2022 and sent a show-cause price hikes as a last resort. We intend to take a price increase economic scenarios,” Hemant increased discounts as there
notice to Byju’s on 24 August that year. are observing volatility mainly for our automotive products Sikka, president, farm equip- are already hefty discounts
The authority’s order of 23 November in commodities and we also effective January 2024, the ment sector, Mahindra and offered among multiple seg-
says that Think & Learn Pvt. Ltd, which observe inflationary trends details for which will be Mahindra said. ments. With disposable
offers IAS preparation under the Byju’s will be on the higher side,” announced closer to the time,” Tata Motors, too, said it will incomes under stress, amid a
brand, failed to produce evidence justifying Shashank Srivastava, senior Nalinikanth Gollagunta, CEO, raise prices across its passen- high inflationary environment
its claims of progressive increase in selec- executive director, Maruti automotive division, Mahin- ger vehicle and electric vehicle and slowing growth, passing
tion of candidates in UPSC civil services Suzuki, said in an interview. dra and Mahindra said. range at the start of the new on the high cost will be a chal-
examinations (CSE), from 62 in 2013 to 295 Automakers typically raise M&M is evaluating price year. A Tata Motors spokes- lenge,” Gaurav Vangaal, asso-
in 2020. prices of passenger vehicles in hikes for its farm equipment person said the carmaker will ciate director, S&P Global
In the order, the CCPA has directed the the new year to coincide with business as well. “We are con- announce the extent of the Mobility said.
company to submit ₹10 lakh as penalty and The Central Consumer Protection Authority has slapped a ₹10 lakh fine on Byju’s IAS. MINT
a compliance report within 15 days of the
order. The company has also been directed and personality test for IAS. that none of them has studied any other
to stop the advertisements. However, the CCPA said in its order that courses apart from the mock interview pro-
Byju’s disagreed with the order. In the institute didn’t provide any data to sub- gramme that are advertised by Byju’s IAS
response to a query, its spokesperson said, stantiate the claim that of the 1,228 civil ser- institute.”
Sembcorp to buy wind assets in India, China
“We note that CCPA has levied fines on vices vacancies filled up in 2013, 62 were As per the order, the institute claimed 82
numerous education/ed-tech institutions students of Byju’s. The order said Byju’s successes out of 1,364 civil services hirings PTI MW of Qinzhou Yuanneng for of renewable assets in India. ment said.
in this matter. We respectfully disagree IAS failed to submit any consent form and in 2014, and provided the data of 24 stu- feedback@livemint.com 130 million Singaporean dol- “Sembcorp’s wholly-owned Separately, its “wholly-
with the findings in the order and fee receipts of the selected candi- dents who had enrolled with the coaching NEw DElhI lar, the firm said in a state- subsidiary, Sembcorp Energy owned subsidiary, Green Infra
intend to appeal the same as we dates. institute for mock interview test. ment. (Shanghai) Holding Co Ltd has Wind Energy Ltd (GIWEL),

S
believe that the advertise- “So, the claims made in the For 2017, out of 236 results from 1,058 embcorp Industries on Sembcorp has been operat- signed an agreement with has signed an agreement with
ments are not misleading.”
“We will look to substan- 62
No. of its trainees
advertisement are not com- vacancies, 201 students were part of a free-
pletely substantiated. Simi- of-cost mock interview; 10 were enrolled
Monday announced that
it has signed two sepa-
ing in India for
more than 12 Last year,
Envision Energy
Co Ltd to acquire
Leap Green Energy Pvt. Ltd
(Leap Green Energy), an inde-
tiate this with relevant evi- larly, it is evident that out of for paid prelims test series; 19 were regis- rate agreements to acquire years, with a pres- Sembcorp 100% of the share pendent power producer in
dence before the appellate Bjyu’s said cleared all successful candidates tered with paid mains test series; and six 428 MW of wind power assets ence across 18 announced the capital in Qinz- Tamil Nadu, India. Under the
authority,” the spokesperson CSE in 2013 showcased in the impugned had joined paid classroom courses. in China and India for 200 mil- states. With this acquisition of hou Yuanneng agreement, GIWEL will
added. The appellate authority advertisement for the years In the order, the CCPA stated that Byju’s lion Singaporean dollar (about acquisition, the Wind Power Co. acquire from Leap Green
Vector Green to
in this case is the National Con- 2013, 2014, 2015, 2016, 2017, IAS violated Section-2(28) of the Consumer ₹1,247 crore). company now has Ltd (Qinzhou Energy, 100% of the share cap-
sumer Disputes Redressal Commis- 2018, 2019, and 2020, most students Protection Act, 2019 as it deliberately con- The Singaporean energy a balanced port- add 583MW of Yuanneng) for an ital in two special purpose
sion (NCDRC). Queries sent to CCPA took a mock interview programme, which cealed important information with respect company, backed by state- folio of 3.7 GW of renewable assets equity considera- vehicles (SPVs) for an equity
remained unanswered till press time. is free of cost,” the CCPA order said. to specific courses attended by the success- owned investor Temasek renewable assets, tion of approxi- consideration of approxi-
CCPA’s order, a copy of which has been The order further said, “It is understood ful candidates, to deceive and mislead con- Holdings Pte, will acquire 228 comprising 2.25 mately 130 mil- mately 70 million Singaporean
reviewed by Mint, was passed after a virtual that mock interview is not a full-time pro- sumers and make huge commercial gains. MW of operational wind GW of wind and 1.45 GW of lion Singaporean dollar. Qinz- dollars. The SPVs own 228MW
hearing, where representatives of Byju’s gramme and it comes into play after an As per the order, Section-2 (28) of the Act power assets of Leap Green solar assets. Last year, it hou Yuanneng owns 200MW of operational wind assets in
said the institute provides some free-of- aspirant has cleared both the prelims and defines misleading advertisement in rela- Energy Pvt. Ltd for 70 million announced the acquisition of of operational wind assets in Madhya Pradesh, Maharashtra
cost courses, including interview guidance mains examination of CSE. Thus, it is clear tion to any product or service. Singaporean dollar and 200 Vector Green to add 583 MW Guangxi, China,” the state- and Rajasthan, India,” it said.

MFIN Launches the 3rd Edition of Micro Matters:

Macro View - India Microfinance Review FY 2022-23
Besides microfinance, the report also covers the macroeconomic context and the progress made under financial inclusion from a broader perspective

M
icrofinance
I n d u s t r y
N e t w o r k
(MFIN), an
industry associ-
ation for microfinance and an
RBI-recognised self-regulatory
organisation, launched the 3rd
Editionof‘MicroMatters:Macro
View – India Microfinance
R e v i e w F Y 2 02 2 -2 3 o n
November 9, 2023 in Mumbai.
Dr Alok Misra, CEO and
Director of MFIN presented the
keyhighlightsoffinancialinclu-
sion and microfinance from the
report.Thiswasfollowedbythe
unveiling of the report by
Amitabh Kant, G20 India
Sherpa, in the presence of
Sivasubramanian Ramann,
CMD, SIDBI. Amitabh Kant
delivered the keynote address
and Ramann gave the special
address.
ThereportisbasedonMFIN’s
in-depth understanding of the
sector based on research and
interactionswithpolicymakers,
regulators, industry players,
funders, and analysts. This
year’s report, besides microfi-
nance, also covers the macro-
economiccontextandtheprog-
ressmadeunderfinancialinclu-
sion, from a broader perspec-
tive. The report highlights that,
despite global headwinds, the
Indianeconomygrewbyaround
7%inFY2022-23.Socialindica-
tors also showed an improve-
ment. As per Niti Aayog’s Multi-
Dimensional Poverty Index,
poverty levels reduced to
14.96%. Regional disparities are
also cause for concern.
The microfinance sector
(NBFC-MFIs, banks, SFBs and
NBFCs) added 80 lakh new
women clients during 2022-23.
Amitabh Kant, G20 India Sherpa
Credit outstanding reached ₹
3.48lakhcroreacross6.64crore
low-income women clients liv-
ing in 729 districts. The credit
quality has bounced back with
portfolio at risk (PAR) 30 to 180
days at 2%. The average micro-
finance loan size has increased
to₹41,391.Importantly,theeast
and northeast – regions which
have been lagging in financial
inclusion - account for 35% of
themicrofinanceportfolio.The
report also underlines the
immense growth potential of
the sector: The microfinance
potential market size is esti-
mated by MFIN at ₹ 13 lakh
crores during FY 2023-24. The
contribution of microfinance
in building an inclusive India is
shownthroughitsdirectimpact
on 6 SDGs (Sustainable
Development Goals). It is heart-
ening to note that the share of
micro under MSME credit by
scheduled commercial banks
(SCB) has increased to 17.9%.
However, an increased share of
personal loans (now at 32% of
Left to right: Dr Alok Misra, CEO & Director, MFIN; Amitabh Kant, G20 India Sherpa; Sivasubramanian
Ramann, CMD - SIDBI; Udaya Kumar Hebbar, Chairperson, MFIN
SCB credit) is an issue for con-
sideration for policy makers.
The report also documents the
work done by MFIN during
2022-23 to strengthen the sec-
tor, and outlines key support
needed from policy makers and
regulators to further expand
microfinance. Requirement for
a suitable credit guarantee
scheme, strengthening equity
supporttosmallerMFIsandthe
relaxation in the qualifying
assets norm has been discussed
with detailed rationale in the
report.
Delivering his keynote
address,AmitabhKantobserved
that, “In the last few years, India
has laid the foundation of
growth in the form of physical
anddigitalinfrastructure.These
buildingblocksarebasedonthe
Prime Minister’s vision of uni-
versalityanddigitalpublicinfra-
structure in all schemes like
aspirational districts, PMJDY,
PM Gram Sadak Yojana etc.
UndertheseinitiativesIndiahas
built nearly 88,000 kms of
Left to right: Dr Vinay Kumar Singh, Head (Self-Regulation & Compliance), MFIN; Dr Samiran
Chakraborty, MD & Chief Economist, Citi Group; Ittira Davis, MD & CEO, Ujjivan SFB; Manish Kothari,
President & Head - Commercial Banking, Kotak Mahindra Bank; Devesh Sachdev, Founder, MD & CEO,
Fusion Microfinance
roads, 40 million houses, 110 infrastructure model to the microfinance with the financial The panel discussed the out- improved with the borrowers
milliontoilets,253millionwater worldanddemocratisefinancial resources of SIDBI and MFIs look for economic growth in becoming more aware of the
connections, 88,000 kms of services.” must make use of it. The need India and deliberated on the importance of keeping their
roads in last few years. This is Sivasubramanian Ramann, of the hour is to address the different aspects of employ- credit record clean. This bodes
equivalent to providing a house Chairman and Managing persisting high share of infor- ment generation as a means for well for the future.” Devesh
to every family in Australia, a Director – SIDBI in his special mal finance and SIDBI is fully equitable sharing of gains. The Sachdev, MD and CEO, Fusion
toilet to every German citizen address said, “SIDBI has been a supportive of the microfinance speakers opined that the wider Microfinance,sharedhisobser-
and a water connection to each partner in the great journey of initiatives furthering last mile availability of credit, the multi- vations from field visits to the
Brazilian. Today India does 11 microfinance institutions and inclusion. We also need to think plier effect of government less developed states. “There is
times more digital payments the sector has grown together beyond technology in the last schemes and improvement in a discernible improvement in
than US and Europe.” Amitabh and delivered. It is heartening mile outreach, where the per- credit culture would underpin the proportion of pucca houses
Kant emphasised that the next to note that microfinance insti- sonal connect of MFIs is future growth. in rural areas and the reach of
phase of growth would be driv- tutions have recovered post critical.” DrSamiranChakraborty,MD DBT.” He emphasised the need
en by credit. COV ID and ar e The panel discussion, Leave and Chief Economist India, for the capacity building of
“Microfinance has a showing a strong No one behind - Balancing Citigroup said that India’s mac- SM E s . M a n i s h Ko t h a r i ,
key role in providing performance. SIDBI EconomicGrowthwithEquitable roeconomic policies have man- President and Head,
credit to far-flung has taken key steps Distribution had Ittira Davis, aged to ward off the challenges Commercial Banking, Kotak
geographies and to boost credit to MD and CEO, Ujjivan Small due to the rise in interest rates, MahindraBank,alsomentioned
c o n t r i b u t i n g to micro entrepre- FinanceBank(SFB);DrSamiran oil prices and USD. “The future the positive developments in
inclusive growth.” neurs.Formalisation Chakraborty, MD and Chief outlook is cautiously optimistic the semi-urban and rural areas
He added that the is being driven by Economist, Citigroup; Manish andasthegeo-politicalscenario withstart-upsusingtechnology
Prime Minister’s MFIN having the Udyam Kothari, President and Head, stabilises, the private capex in sectors like dairy to capture
mandate was to Assist Portal and Commercial Banking, Kotak cyclecanbeexpectedtorestart.” data “which is enabling better
make G20 inclusive. “Four bil- around 1 crore enterprises are Mahindra Bank and Devesh Ittira Davis, CEO, Ujjivan Small credit underwriting for loans.
lion people across world do not already a part of it. MFIs with Sachdev, Founder, MD and Finance Bank, pointed out that The multiplier effect due to the
haveadigitalidentity,2.5billion theirclientbaseofnearly7crore CEO, Fusion Microfinance, as COVID had impacted the SME increase in road network is
do not have a bank account, 133 need to onboard them on to the the panellists and Dr Vinay and MF borrowers, but they noticeable in these
countries do not have a fast pay- portal. Further, the co-lending Kumar Singh, Head (Self- bouncedbackearlierthanother geographies.”
ment system - India has taken scheme of SIDBI combines the Regulation and Compliance), segments. “It is encouraging to
the lead to take its digital public power of origination of MFIN as the moderator. note that the credit culture has Created by Mint Brand Studio
06 TuesDay, 28 November 2023
New Delhi CORPORATE LIVEMINT.COM

Hoteliers pitch for delinking Note of dissent

Twelve resolutions where LIC expressed strong reservations but abstained from voting
Resolution LIC holding (in %)

dining GST from room tariffs

WITH LESS than ten years of post-qualification work experience,
ADANI GREEN (1.36) his experience is not enough to be an executive director on the
 Sagar Adani's reappointment
board of a listed company. Remuneration not capped

AUROBINDO PHARMA (5.43) ENFORCEMENT DIRECTORATE has a case against him

 P. Sarath Reddy's reappointment

PROPOSED REMUNERATION of 1.2 crore per annum is high and not

LAURUS LABS (2.70) commensurate with Soumya Chava’s experience, nor is it comparable to
 S. Chava's appointment as head-commercial the remuneration drawn by the firm’s more experienced employees
GST discrepancy puts hotel restaurants at a disadvantage compared with standalone eateries
SUN PHARMACEUTICAL (2.91) SKEWED REMUNERATION in favor of promoters
 Aalok Shanghvi's appointment as director
Varuni Khosla South Asia, Radisson Hotel Group.
DIXON TECHNOLOGIES (5.48) GOVERNANCE CONCERN
varuni.k@livemint.com “Due to this difference, the customer  Approval of Prithvi Vachani's remuneration
New Delhi perceives hotel restaurants to be more
expensive and seeks dining options DCM SHRIRAM (6.77) NO ABSOLUTE cap on commission

C
ompanies operating mid- outside of the hotel including takea-  Aditya Shriram's appointment as deputy MD

market and upscale hotels way. This situation requires a correc-

are at risk of losing their tion. GST rates have to be de-linked THERE IS no granular clarity on his educational and professional
ALKEM LABORATORIES (<1) experience. The company needs to provide greater clarity on the
restaurant customers due from hotel room tariffs,” Kachru added. benchmarking of his experience and remuneration with those in his
 Sarandhar Singh's appointment as VP
to a discrepancy that sees “If it is an economy hotel, then the proposed designation or cadre. It has not capped the remuneration
their diners charged higher goods and rule works well because they can
services tax (GST) than those at standal- charge 5% GST since their room tariffs OPEN-ENDED nature of the resolution. Governance concern:
SHREE CEMENT (3.91)
one restaurants. are under ₹7,500 usually. But in other  Prashant Bangur's reappointment as joint MD
Board discretion without absolute cap on variable pay. Skewed
The current GST calculation method formats, the customer hurts because remuneration practice
for standalone restaurants and restau- hotel restaurants become less afforda-
PIRAMAL ENTERPRISES (4.65) LACK OF disclosures regarding her proposed remuneration
rants within hotels differs significantly. ble. This is also true in the banqueting from PPL
 Nandini Piramal's reappointment
While standalone restaurants are sub- business where the amounts are so
ject to a flat 5% GST, patrons who dine large,” said Ajay K. Bakaya, managing REMUNERATION APPEARS to be excessive on fair comparison
TORRENT POWER (3.79)
at restaurants inside hotels have to pay director at Sarovar Hotels. with peers in the industry and also outpaced in relation to growth
 Jinal Mehta's reappointment as MD
more than three times the rate at a Hospitality consultancy Hotelivate’s given to median employees
hefty 18%. This tax rate comes into managing partner Achin Khanna said
TORRENT POWER (3.8) INADEQUATE DISCLOSURE about his proposed high
effect when a hotel company declares the highly competitive restaurant busi- remuneration and no cap on vaiable commission content
 Varun Mehta's appointment as director
a room tariff that exceeds ₹7,500. ness environment has already caused
The higher rate of GST on dining much concern to food and beverage INFORMED TECHNOLOGIES (8.91) THERE IS no clarity on her experience prior to joining the board
applies even to non-hotel guests dining outlets within hotels since this current  Tara Khandelwal's appointment as director
Source: Mint review of filings over the last two years; BSE.
at a property. situation is not a level playing field.
Hoteliers have expressed concern If a diner at a stand-alone Asian cuisine restaurant in Delhi pays GST of ₹100 on a “While hotel food and beverage out-
that this disparity—which has been in bill of ₹2,000, the same would be ₹360 if it were an Asian restaurant in a hotel.. MINT lets already face competition from the
force since 2018—is driving customers
away from their restaurants, who are This room tariff is declared on the price-conscious.
rapidly expanding independent restau-
rant industry, the 18% GST levied on
LIC glare on top appointments
opting for standalone establishments company’s website or on a printed tariff Some hoteliers feel that when the hotel dining, compared with the stan-
that offer lower taxes. card displayed at its reception. GST rule was implemented, it may have dard 5%, further discourages guests FROM PAGE 1 In November 2022, Sarath of Hari Bangur at Shree Cement
They argue that a flat 5% GST for all This makes it hard for hotels because been assumed that hotels mainly from dining at the hotel, leading to lost Reddy was named in an alleged Ltd and Ajay Piramal at Piramal
restaurants would create a more level most places are dotted with standalone attract better-off customers who could sales opportunities,” he said. 1.36% of the company, helped corruption case over the award Enterprises Ltd last year.
playing field and benefit the restaurants that offer similar afford to pay this additional “In a country such as ours the resolution sail through with of licences to liquor stores in Queries sent to an LIC
industry as a whole. ambience, food quality and sum. where diverse tax structures a 96% vote in favour. New Delhi and was arrested by spokesperson seeking com-
At a time when standal- menu that are cheaper. “Hotels invest a lot of are prevalent, it is quite Similarly, LIC made a rare the ED. In all, 77.5% of public ments remained unanswered.
one restaurants are doing
well, and the competition 5%
Flat GST rate levied
A customer at a stan- capital in creating food
dalone Asian cuisine res- and beverage facilities 18%
GST at restaurants
challenging to be able to
have a single approach on
rebuke on the reappointment
of P. Sarath Chandra Reddy,
institutions rejected the resolu-
tion. But a 51.83% promoter
“LIC is the largest domestic
institutional investor and for
is already fierce, the hotel taurant in the capital and experiences on their GST. A lower GST at a the eldest son of P.V. Ram- ownership and the abstention this reason, how it is voting on
industry wants to know at stand-alone spending ₹2,000 would premises depending on in hotels with room stand-alone restaurant, prasad Reddy, the co-founder of LIC, which owns 5.43% in the resolutions is of importance to
why a hotel room rate restaurants be shelling out ₹100 in the service level and cli- tariff above ₹7,500 as against a higher one at of Aurobindo Pharma, the firm, helped the proposal corporate India,” said Amit
should have any signifi- GST. But the same bill at a entele. Charging a higher restaurants in branded fifth-largest pharma company secure approval with a 73.2% Tandon, founder and managing
cance for dining options. similar restaurant in a hotel GST of 13 percentage points hotels sees quite a contrast. by sales. vote in favour. director at Institutional Investor
The GST Council says will come with a GST of ₹360. on hotel restaurants is not fair, But it also means hotels have the “[The] Enforcement Direct- LIC made similar observa- Advisory Services (IiAS), a proxy
“declared tariff” is a rate which is As it is, more and more hotel guests particularly due to higher investment opportunity to differentiate them- orate (ED) has a case against tions against the scions of Dilip advisory firm. Tandon declined
defined by a hotel at the beginning of have started to order food from deliv- in creating those set-ups,” said K.B. selves and provide an elevated dining him,” LIC reasoned when the Shanghvi at Sun Pharmaceuti- to comment on the disconnect
each year—so the hotel itself is in ery platforms at the hotel gate and carry Kachru, Hotel Association of India experience,” said Samir M.C., manag- resolution seeking re-appoint- cal Industries Ltd and Satyana- between LIC’s rationale and its
charge of how much GST it wants to that food into their rooms. In mid-mar- (HAI), vice-president and chairman ing director of ITC-owned Fortune ment of Sarath Reddy was put rayana Chava of Laurus Labs abstaining from voting on these
charge at its restaurants. ket hotels, customers are far more emeritus and principal adviser for Park Hotels Ltd. before shareholders this August. Ltd this year, and the children resolutions.

LIC keen to Penalties jump as RBI turns Irdai questions Care on Saluja’s Esops
keep part of up scrutiny of banks, NBFCs FROM PAGE 1 The Religare stock stood at ual despite Irdai’s rejection. In

its stake in FROM PAGE 1 nies where two of its directors

vinder Singh, who are facing
fraud charges.
₹175.62 at the beginning of the this case, after Irdai rejected
year. On 21 and 22 September, the Esop proposal for Saluja,
the two days when Saluja sold instead of granting her the
IDBI Bank in the previous fiscal, showed
were also directors, marketed
and engaged in the sale of a non-
The Burmans rejected these
allegations and said the Relig-
some of her shares, it touched shares directly, the board did it
the highest levels at ₹279 and indirectly by terming her a
data available in RBI’s report financial product, and failed to are board failed to comply ₹280.3, respectively. It fell to Religare employee. He sug-
PTI titled Trend and Progress of report frauds to RBI within the with corporate governance ₹258.14 on the day of the Bur- gested Irdai should initiate a
feedback@livemint.com Banking in India 2021-22. prescribed timelines. norms; Saluja traded in shares man open offer on 25 Septem- thorough probe and take
New Delhi Experts said it is reassuring Earlier, this April, RBI had of Religare while being in pos- ber, and it has fallen further to appropriate action, and rope in
that the regulator is keeping a imposed a fine of ₹6.77 crore on session of privileged insider close at ₹218.15 on Friday. The Securities and Exchange

S
tate-owned Life Insur-
ance Corporation (LIC),
promoter of IDBI Bank,
has said it plans to retain a part
of its stake in the lender to har-
ness the benefits of the ban-
cassurance.
Along with the government,
LIC will also divest its stake in
IDBI Bank but may not exit
completely, LIC chairman Sid-
dhartha Mohanty told PTI in
an interview.
“We have made it clear that
IDBI Bank is our number one
partner in bancassurance. We
will retain the some stake in
IDBI Bank so that the bancas-
surance partnership contin-
ues,” he said.
The government, which
owns over 45% stake in IDBI
Bank, and life insurance behe-
moth LIC, with a 49.24%
shareholding in the lender,
have jointly decided to sell a
60.7% stake. IDBI Bank
became a subsidiary of LIC
with effect from 21 January
2019, after the acquisition of
an additional 827,590,885
equity shares.
On 19 December 2020, IDBI
Bank was reclassified as an
associate company due to the
reduction of LIC shareholding
to 49.24%, following the issu-
ance of additional equity
close eye, and neither the len-
ders nor the regulator wants a
return of the asset quality stress
seen between 2013 and 2018.
“This is a credit positive as it is
important for individual lend-
ing entities and the financial
system to be aware that the reg-
ulator is watching and is willing
to take action,” said Saswata
Guha, senior director, financial
institutions (banks), Fitch Rat-
ings, adding that RBI’s recent
actions on unsecured loans is an
example of increased regula-
tory oversight.
On 16 November, RBI
increased risk weights on con-
sumption loans, credit card
exposures and loans to non-
bank financiers by 25 percent-
age points each to rein in unfet-
tered growth of unsecured
loans. Separately, governor
Shaktikanta Das said last week
that RBI has significantly
strengthened its regulation and
World Cup hits viewership of non-sports genres, advertising on TV, OTT
Lata Jha
lata.j@htlive.com
New Delhi
Experts said it’s reassuring that
RBI is keeping a close eye. MINT
supervision of banks, NBFCs
and other regulated entities in
recent years.
Das said RBI is monitoring
entities it regulates through var-
ious on-site and off-site tools,
stress testing, vulnerability
assessments, thematic studies,
and data dump analysis, among
others. These, Das said, are part
of its “proactive and forward-
looking supervisory approach”.
The penalties levied range
from a few lakh rupees to crores.
In October, RBI imposed a fine
of ₹12.19 crore, among highest
this year, on private-sector len-
der ICICI Bank. Reason: It found
that the lender had sanctioned
or committed loans to compa-
Mantha, partner, media and
entertainment sector leader,
Deloitte India. He added that
overall GRPs saw a near 17%
Mahindra & Mahindra Finan-
cial Services after it found that
the NBFC had failed to comply
with guidelines on fair prac-
tices related to disclosure of
annualized rate of interest
charged to borrowers during
the sanction, and failed to give
notice of change in terms and
conditions when it charged
higher rate of interest.
Legal experts said RBI
retains the discretion to levy
penalties depending on the
gravity of the non-compliance,
with powers available under
the RBI Act of 1934.
“While it would greatly help
to have a compendium of pen-
alties that may be levied by the
RBI, this may not be practically
feasible given the number of
regulations and compliances
that are outlined as being appli-
cable to NBFCs and banks,”
said Pritha Jha, partner, Pio-
neer Legal, a law firm.
information; and her average
annual compensation is as
high as ₹150 crore, including
Esops from Religare and Care
Health Insurance.
However, in a statement
defending Saluja, Religare
rejected charges of insider trad-
ing. The statement stated that
the Care Health Esops vest over
a period of time subject to con-
ditions, and said even after add-
ing the value of performance-
linked Esops, Saluja’s FY23
remuneration stood at ₹42.06
crore, against ₹150 crore as
alleged by the Burmans.
Meanwhile, proxy advisory
firm InGovern said the Care
stock options were not explic-
itly declared to Religare share-
holders and no approval was
sought for granting them.
“The Care Health board,
Gulati and Singh have been
asked to reply or clarify within
a week on certain questions by
Rashmi Saluja, non-executive
chairperson, Care Health.
Irdai related to the excessive
Esops issuance in Care Health
to both Dr. Saluja and Gulati,”
said the second of the two per-
sons mentioned earlier.
The premium income of
Care Health has jumped five-
fold since Saluja took the helm
of parent Religare in 2018,
making it the second-largest
standalone health insurer in
the country.
The biggest subsidiary of
Religare, Care Health is esti-
mated to be worth at least
₹10,000 crore based on its
embedded value. Religare’s
market value is lower than
Care’s estimated value, but its
stock reflects the business per-
formance of Care.
impact,” Soumya Mukherjee, on cricket. Auto, FMCG, beauty
chief operating officer at Ben- products and consumer tech
gali streaming service hoichoi were the primary advertisers
said.
board led by Saluja has stated Board of India as well since it
that any offer price below ₹275 involves Religare, a listed
is not fair; however, market holding company.
research reports have The three independent
predicted that Religare’s directors serving on the boards
shares may gain of both Religare
after the Bur- InGovern said the and Care are Malay
mans’ takeover. Care Esops weren’t Kumar Sinha,
Incentivizing explicitly declared Hamid Ahmed and
someone by to REL investors Praveen Kumar
ignoring a regu- Tripathi.
and no approval
latory directive According to a
raises a “serious was sought for 15 November note
issue” on govern- granting them by InGovern, in
ance, a corporate the past 3-4 years,
lawyer at a lead- the total valuation
ing law firm said. “As a material of Religare and Care Health
subsidiary of a listed company options issued to Saluja is
(Religare), at least one of the more than ₹480 crore.
independent directors of Care Emails sent to Irdai, Relig-
Health is also on the board of are, Saluja, Gulati and Singh
Religare, and it is the duty of remained unanswered.
such independent directors to Neither Religare nor Care
flag off the issue to the board or Health revealed in their FY23
the regulator immediately, annual reports that Saluja got
asking how were the shares 22.7 million Esops of Care
granted to a particular individ- Health.
person added. That said, new
launches were held back for the
period and planned in a stag-
who drive this growth, accord- gered manner to avoid getting

shares by the bank under a
qualified institutional place-
ment (QIP).
IDBI Bank has been the
strongest contributor to the
bancassurance channel, he
said, adding that for the ban-
cassurance arrangement to
continue, LIC may not be
required to hold the entire
stake.
Bancassurance is an
arrangement between a bank
and an insurance company,
allowing the latter to sell its
products to the bank’s cus-
tomers and others through the
branch network.
A
iring of prime cricket
property—the World
Cup, preceded by the
Asia Cup—has resulted in a
dent in viewership and adver-
tising for non-sports channels
on television as well as stream-
ing platforms. And the dent is
sizeable.
“Cricketing data available for
10 weeks, excluding the last
week of the World Cup, com-
pared with the previous
10-week period of non-cricket-
ing months, shows that the
sports genre GRPs increased by
almost 322%, all dominated by
cricket,” said Chandrashekhar
drop on TV during the cricket-
ing season, while GRPs of gen-
eral entertainment channels, or
GECs, fell 19%, movies 25%, and
news, 24%.
GRPs stand for gross rating
points, a standard to measure
advertising impact.
Media buyers say non-sport-
ing channels usually see 8-10%
year-on-year growth in adver-
tising during the festive quar-
ter, but that may have grown
only 5% this time. Further, even
though OTT streaming plat-
forms are not driven by
appointment viewing, they still
saw an overall impact on con-
Cricket advertising expendi- ing to Sundaram. drowned in cricket frenzy.
ture this year is in the range of A senior executive at a While popular events such as
₹8,000 crore– broadcasting net- the World Cup are long known
₹10,000 crore. Except cricket, all work said on the and media spends planned
Typically, mar- other genres saw condition of ano- much in advance, industry
quee events such GRPs dip 20% on nymity that experts said the impact on non-
as IPL (Indian average, including advertisers have sports genres should be signifi-
Premier League)
19% for GECs, 25% sought respite cant given the spends on
and the World from daily soaps cricket this year. According to
Cup take up a big for movies and aired through the data from TAM Sports, a divi-
Compared with the 8-10% y-o-y growth in advertising channels see chunk of it, Ram- 24% for news day and replays of sion of TAM Media Research,
during the festive quarter, they may have grown only by 5%. AP mohan Sunda- older episodes in during each month from
ram, president, the afternoons. August to November 2023,
sumption, particularly on days impact (on viewership) during integrated media, DDB Mudra “Also, when the tournament GEC was the leading channel
when India was playing. high points of the matches. At Group said. Therefore, was available for free online, it genre with maximum ad vol-
However, when the game the same time, there was a sig- between the Asia Cup and is likely that some families were ume share, but showed
paused, OTT services bounced nificant surge before and after, World Cup, around ₹4,000 able to watch other kinds of decreasing trend over the
back. “There was a 15-20% balancing the previous crore would easily be invested content at night on TV,” the months, from 31% to 29%.
LIVEMINT.COM CORPORATE TUESDAY, 28 NOVEMBER 2023
NEW DElHI 07
TuesDay, 28 November 2023
New Delhi 07

Gen AI unlikely to bail out ‘Around 200 planes

may stay grounded
IT services firms: experts in India by March’ REFILLABLE
Anu Sharma
anu.sharma@livemint.com
New DelhI
MARKERS
Its contribution to overall revenue of top IT services firms is likely to be less than 1%
T FULL SIZE
he Indian aviation sector
may witness a grounded
Shouvik Das fleet of around 200 air-
shouvik.das@livemint.com
New DelhI
A dampener for now
Share prices of TCS, Wipro and Tech
craft by the end of the current
financial year, aviation consult-
Marker with Clip
● DARKER COLOUR
Mahindra have each declined by 2% ancy firm Capa India said in its

G
enerative artificial intelligence, or since closing on 29 September mid-year outlook.
Gen AI, the biggest buzzword in Stock price change since beginning of The grounded fleet is likely The grounded fleet is likely
enterprise technology this year, will to include more than 90 air- to include over 90 IndiGo
● LONGER WRITING
Dec quarter (in %)
not be a factor helping India’s $245- craft of India’s largest airline aircraft.
5.85
billion information technology ser- IndiGo, followed by 25-30 air-
vices industry return to revenue growth in the craft each of the Tata Group- “Supply chain issues are now
ongoing quarter or the next. backed Air India and low-cost a critical risk, and could have a
In fact, gen AI’s contribution to the overall rev- carrier SpiceJet. In addition, 54 deeper and more strategic
enue of India’s top IT services firms is expected to aircraft of Go First are impact than anticipated. This
be less than 1% despite an increasing number of grounded since the airline sus- could for example impact the
Tech
pilots and partnerships in this emerging technol- TCS 0.13 Wipro Mahindra pended flights in May. ability of mainline scheduled
ogy, say industry experts. Currently, over 160 aircraft airlines to operate Udan flight,”
This is not entirely unexpected. Generative AI across Indian airlines are Capa India said.
is still in its infancy, and has failed to translate to Infosys HCL Tech grounded and the increase in In fact, the fleet of wet leased
large deals and projects, at least not yet. Revenue -2.07 -2.02 grounded fleet size is expected aircraft in India could be
-2.53
growth for IT services companies in the Decem- to be on account of IndiGo around 30 by March as IndiGo
ber quarter is expected to remain muted as clients Note: Markets were closed on 27 November Source: Mint analysis which currently has 55 aircraft and SpiceJet are inducting
across sectors continue to be conservative in on ground, Capa India said. capacity on this model
spending on technology. PRANAY BHARDWAJ/MINT
Overall, the sector is likely to whereby an aircraft is leased
“The overall scale of AI deployments across trained over 100,000 employees on gen AI, chief For India’s IT sector, it would still be a while have a fleet size of close to 790 along with crew.
sectors and types of technologies such as cloud executive K Krithivasan said during a post-earn- before they reap the benefits. aircraft by March In terms of air
and blockchain is quite strong. However, genera- ings call with analysts in October. “Most top companies across sectors are experi- 2024, of which Currently, over fares, the research
tive AI’s contribution as part of it remains small On Monday, TCS signed a deal to add Amazon menting with deployments of generative AI in 588 aircraft are 160 aircraft across firm has noted
for the time being,” said Apurva Prasad, vice-pres- Web Services’ generative AI services to its client various ways, which is good news for the IT servi- likely to be opera- Indian airlines are return of nor-
ident of institutional research at HDFC Securities. offerings. ces sector. However, most of these pilot experi- tional, the avia- grounded and the malcy despite
Adding to this were global economic concerns Infosys chief executive Salil Parekh had said in ments are of deals sized lesser than $1 million in tion research firm shortage in capac-
increase is
and weak overall demand. July that the company had 80 active client pro- total contract value,” said a senior industry con- said. Capa India ity. Average fares
“There is a slowdown within the US economy, jects in generative AI. At a post-earnings press sultant who works with multiple leading IT servi- also expects expected to be on declined by 12.7%
which may extend into the next calendar ces firms. delays in aircraft account of IndiGo on year in Sep-
year—that’s certainly of concern. The LACKLUSTRE PERFORMANCE “If you take this into account for most deliveries for tember quarter
risk of recession is not gone either, and of the top firms, generative AI’s contribu- India’s youngest and while some
none of these scenarios are likely to GENERATIVE AI is REVENUE growth INDIA’S largest IT tion is at around 0.5% of the net new deals airline Akasa Air. weakness is expected in March
change,” Prasad said. still in its infancy, and for IT services services companies being signed by the service providers In terms of the total number quarter, full-year yields are
has failed to companies in Dec are betting big on
“Some sectors such as banking and translate to large quarter is expected generative AI every quarter,” the consultant said, of flyers, the domestic and likely to be around 3% lower on
financial services may see some relief deals and projects to remain muted nonetheless requesting anonymity. international passenger traffic year. The softer yields are
since interest rates have relaxed. These A senior researcher at a Mumbai-based for FY24 are expected to be expected to result in higher
will offer tactical factors that may make brokerage, also requesting anonymity, around 155 million and 70 mil- losses for full-service carriers
the market look a little more favourable for the briefing in October, Parekh said the company has said India’s top IT services firms are experiment- lion passengers respectively. As such as Air India and Vistara
service providers, but those are more driven by trained more than 50,000 employees in genera- ing with generative AI use cases, which could per Airports Authority of India than the earlier projected lev-
rates. The overall industry health is not looking tive AI skills, and the number was expanding expedite monetization. But not immediately. and Directorate General of els.“Growth momentum in the
better off.” “every week or every quarter.” “At least the second half of this fiscal will Civil Aviation, Indian airports market will continue. Interna-
India’s largest IT services companies are bet- TCS’ and Infosys’ progress on generative AI remain without any major large deals in genera- registered 57 million interna- tional operations are coming
ting big on generative AI nonetheless. adoption came off the back of global cues—in tive AI for any of India’s IT outsourcers, which tional passengers while the into greater focus and will
Tata Consultancy Services (TCS), India’s largest June, Accenture chief Julie Sweet said the com- means that there will be no generative AI-driven domestic air passenger traffic receive an increasing share of
IT services company by market cap, has “more pany had signed on $100 million worth of gen AI boost to revenue growth in the ongoing or next stood at 136 million passengers planned capacity,” Capa India
than 250 opportunities in the pipeline,” and had projects. quarters,” the researcher said. in FY23. noted.

25
`

PER PCS

Have fun
with facts
on Sundays
Catch the latest column of

A
A quiz on the week’s development.

hindustantimes htTweets www.hindustantimes.com

20
`

PER PCS

For SPL Discount on Bulk Buy:

w w w.markers.addpens.com
08 TuesDay, 28 November 2023
New Delhi GLOBAL LIVEMINT.COM

m MINT SHORTS Biden plans to skip UN China warns of

Alibaba shuts quantum computing coming surge after
lab in sign of broader cutback
Alibaba Group Holding Ltd has shuttered its quantum comput-
ing research lab, a sign that the Chinese e-commerce and cloud
operator is considering more cutbacks to bulk up the bottom line.
climate talks in Dubai pneumonia in kids
China’s e-commerce leader is in the middle of an overhaul spear- Bloomberg
headed by Joseph Tsai and Eddie Wu, two confidantes of feedback@livemint.com
co-founder Jack Ma who took over the company in September.
COP28 begins on Thursday; White House says sending climate team
C
This month, the pair announced they were killing the much-an- hina said a surge in
ticipated spinoff and listing of the cloud services division, an mycoplasma-caused
about-face that spurred speculation about other changes to Ali- pneumonia in children
baba’s long-term roadmap. Before that surprise decision, the firm AP shows signs of ebbing, but
was in the midst a complicated six-way split that would break the feedback@livemint.com warned that other respiratory
company up into component businesses from commerce and WASHINGTON illnesses are likely to hit the
entertainment to logistics. BLOOMBERG broader population hard dur-

P
resident Joe Biden plans to skip ing the mainland’s first winter
the annual climate talks in after covid restrictions.
Israel-Hamas truce in Gaza Dubai this week, an event that is Health authorities in Beijing
expected to draw heads of state say flu, adenovirus and respira-
extended by two days: Qatar and diplomats from roughly tory syncytial virus have sur-
AFP
200 nations and the Vatican. He has passed mycoplasma as the most The surge has sparked a rush
attended twice before. frequently detected pathogens to hospitals by anxious
The White House said it was sending a among patients at the city’s top parents. REUTERS
climate team, including special envoy paediatric medical centres.
John Kerry, climate adviser Ali Zaidi and Nearby Tianjin and Shanghai of overcrowded hallways and
clean energy adviser John Podesta. have also seen their myco- children on intravenous infu-
“Although we don’t have any travel plasma positivity rates trending sions have gone viral on Chi-
updates to share for the president at this down in recent days, according nese social media. More people
time, the administration looks forward to to local media reports. are wearing masks on public
a robust and productive COP28,” said But even as the mycoplasma transportation in cities includ-
White House spokesman Angelo Fernán- danger for kids subsides, ing Beijing and some schools in
dez Hernández, adding that Biden’s team China’s National Health Com- eastern Zhejiang province sus-
would continue to build on the adminis- Biden has called climate change the “ultimate threat to humanity.” AP mission said late last week that pended in-person teaching
A humanitarian pause in fighting between Israel and tration actions “to tackle the climate cri- the spread of several respira- after several kids were sick with
Hamas will extend by two days, mediator Qatar said on sis.” This year the United Arab Emirates, the tory pathogens could converge mycoplasma and other ill-
Monday as an initial four-day truce in Gaza was set to
expire. Over the course of the humanitarian pause and in
Biden had also pledged to visit Africa world’s fifth-largest oil producer, is host-
before the end of the year, but that trip ing the climate talks. The conflicts in East-
‘UAE planned to into a major outbreak between nesses. Some parents have also
now and next spring. called for temporary school
weeks prior, Qatar, with the support of the US and Egypt,
has been engaged in intense negotiations to establish and
doesn’t appear to be happening, either. ern Europe and the Middle East could
The White House offered no reasons, but make cooperation between the nations discuss gas deals’ The steady rise in pneumo- shutdowns to prevent the
nia among chil- spread.
prolong the truce in Gaza, which mediators had said was the president has been deeply engaged in even more difficult. dren in kindergar- Outside China, Outside China,
designed to be broadened and expanded. Over the course both the war in Ukraine and the Israel-Ha- And Sultan al-Jaber was appointed as Reuters tens and primary the scenes have,
the scenes
of the initial truce a total 50 civilian hostages, women and mas conflict, as well as domestic battles the president-designate, a decision feedback@livemint.com schools flooded have, for some, for some, brought
children, were expected to be freed by Hamas. In exchange, with Congress over government funding. roundly criticized by climate activists hospitals this brought back back memories of

C
150 Palestinian prisoners held by Israel were to be released The two-week COP28 because he serves as the CEO OP28 host UAE planned to month and
memories of the the early days of
and humanitarian aid allowed into Gaza. AFP conference begins on Thurs- Biden had also of the Abu Dhabi National Oil discuss possible natural gas prompted the covid, which
day and is convened annu- Co., which is seeking to boost and other commercial deals World Health early days of emerged as a mys-
pledged to visit
ally by the United Nations. Africa before the its production of carbon- ahead of UN climate talks that Organization to covid terious pneumo-
North Korea brings back weapons, COP stands for “Conference end of the year, emitting crude oil and natural begin this week, an investigation by make an inquiry nia—and fuelled
of the Parties”—the nations gas. the BBC and the Centre for Climate with Beijing. concerns that the
troops to shut border posts that agreed to a climate
but that trip also
Biden has called climate Reporting said on Monday. China said known germs were mainland could see another
North Korea appears to have deployed soldiers and weapons to change framework drafted doesn’t appear to change the “ultimate threat to The investigation cited leaked causing the outbreak—mostly new pathogen emerge.
guard posts near the border that were shut in a 2018 deal with by the UN in 1992. It’s been be happening humanity.” documents, which it said were pre- mycoplasma pneumoniae, a Health experts, like the gov-
South Korea as tensions between the neighbours ratchet up in held 28 times, so this year it’s Earlier this month, he pared for COP28 president-desig- bacterial infection that typi- ernment, say the culprit is
the wake of Pyongyang’s recent spy satellite launch. South called “COP28.” released an assessment on the nate Sultan Al Jaber for meetings cally leads to mild colds in older likely an existing germ.
Korean military officials have spotted activity near the posts Countries that signed the agreement state of climate change in America and with at least 27 governments. They children and adults but could “The fact that only children
inside the demilitarized zone since late last week, the defence promise to work to stabilize greenhouse said the issue was impacting all regions in included talking points to further cause more serious illness are affected suggests this is
ministry said in a statement on Monday. Seoul pledged to take gas emissions and prevent “dangerous” the US. “Not just some, all,” he said. “Any- ADNOC’s interests in LNG or pet- among younger kids. most likely to be an existing
corresponding measures, according the statement, hinting at a human interference with the climate sys- one who willfully denies the impact of cli- rochemicals, as well as Masdar’s The surge sparked a rush to pathogen,” said Jin Dong-yan,
restoration of South Korean guard posts near the border. South tem. Their goal is to move the globe off mate change is condemning the American interests in renewables and other hospitals by anxious parents, a professor specializing in virol-
Korea’s military also detected an increase in activity for North fossil fuels that are pushing up Earth’s people to a very dangerous future,” he climate-mitigation measures. putting top paediatric medical ogy and cancer at the Univer-
Korea’s coastal artillery, according to the statement.BLOOMBERG temperatures. said. centres under strain. Pictures sity of Hong Kong.

Evolve from
Hindustan Media Ventures Limited
Registered Office: Budh Marg, Patna – 800001
Ph.: +91 612 222 3434; Fax: +91 612 222 1545
‘What are the best MAKE YOUR
Corporate Office: Hindustan Times House (2nd Floor),
18-20, Kasturba Gandhi Marg, New Delhi – 110 001
stock picks?’ MONDAY
Ph.: +91 11 6656 1234; E-mail: hmvlinvestor@livehindustan.com;
Website: www.hmvl.in
CIN: L21090BR1918PLC000013
NOTICE OF POSTAL BALLOT
NOTICE is hereby given pursuant to Sections 108, 110 and other applicable provisions, if
any, of the Companies Act, 2013 (the ‘Act’), read with Rules 20 and 22 of the Companies
MORNING
(Management and Administration) Rules, 2014 (the ‘Rules’), Regulation 44 and other
applicable regulations, if any, of the Securities and Exchange Board of India (Listing
Obligations and Disclosure Requirements) Regulations, 2015 (the ‘SEBI LODR’), the
Secretarial Standard - 2 on General Meetings issued by the Institute of Company Secretaries
of India (‘SS-2’), each as amended, from time to time and Circulars issued by the Ministry of
PLAYFUL
Corporate Affairs, Government of India (‘MCA’) viz. General Circulars No.14/2020 dated April
08, 2020, No. 17/2020 dated April 13, 2020, No. 22/2020 dated June 15, 2020, No. 33/2020
dated September 28, 2020, No. 39/2020 dated December 31, 2020, No. 10/2021 dated June
23, 2021, No. 20/2021 dated December 08, 2021, 03/2022 dated May 05, 2022, 11/2022 dated
Catch the latest section of
December 28, 2022 and 09/2023 dated September 25, 2023 (collectively referred to as ‘MCA
Circulars’), it is proposed to seek approval of members via Postal Ballot process by e-voting
only, in respect of the following business as set out in the Postal Ballot Notice dated November
02, 2023 (the ‘Notice’), circulated to the members.
Description of Special Business
Appointment of Shri Sharad Bhansali (DIN: 08964527) as an Independent Director, not liable
to solve a set of intriguing puzzles.
to retire by rotation
In compliance with the provisions of the Act, MCA Circulars and the SEBI LODR, the Company
has completed dispatch of the Notice through e-mail on Monday, November 27, 2023 to
those members whose e-mail address is registered with Depository Participant (in case of
electronic shareholding)/the Company’s Registrar and Share Transfer Agent (in case of
physical shareholding). The detailed procedure/instructions on the process of e-voting is
specified in the Notice.
to
Other details are as under:
1. The cut-off date for the purpose of reckoning voting rights and sending Notice is
Friday, November 24, 2023 (‘Cut-off date’). Members whose name appears in the
‘How do I pick the best
Register of Members/List of Beneficial Owners as on the Cut-off date shall be entitled to
avail the facility of remote e-voting. A person who is not a member as on the cut-off date
shall treat this notice for information purposes only.
stocks quick?’
2. The Company has engaged the services of KFin Technologies Limited (‘RTA’ or ‘KFin’)
as the agency to provide the e-voting facility. The e-voting facility shall commence at
9.00 A.M. (IST) on Tuesday, November 28, 2023 till 5.00 P.M. (IST) on Wednesday,
December 27, 2023. Thereafter, the e-voting module shall be disabled by KFin. Once the
vote on the resolution is cast by the Member, he/she shall not be allowed to change it
subsequently.
3. Manner of Registering/Updating email address:
• Members holding shares in dematerialized mode, are requested to register their email
addresses and mobile numbers with their relevant depositors through their depository
participants.
• Members holding shares in physical form and who have not registered/updated
their KYC details including e-mail address with the Company or RTA, may
register/update such details by downloading the relevant forms from the said link
https://ris.kfintech.com/clientservices/isc/default.aspx#isc_download_hrd and
send them along with details like name, folio number, scanned copy of the share
certificate (front and back) and self-attested scanned copy of PAN and Aadhar Card,
either in writing to KFin Technologies Limited, Unit: Hindustan Media Ventures Limited,
Selenium Building, Tower B, Plot No. 31 & 32, Financial District, Nanakramguda,
Serilingampally, Hyderabad, Rangareddy, Telangana, India – 500 032 or by sending
e-mail to einward.ris@kfintech.com.
4. Results of Postal Ballot will be declared by the Chairperson or any other person authorised
by her, on or before Friday, December 29, 2023 by 5.00 P.M. (IST). The voting results
along with the Scrutinizer’s report of Shri Sanket Jain, Practising Company Secretary,
will be hosted on the Company’s website viz. www.hmvl.in and on KFin’s website viz.
https://evoting.kfintech.com. The result shall also be intimated to the Stock Exchanges
viz. BSE and NSE at www.bseindia.com and www.nseindia.com, respectively.
5. In case of any query/grievance in respect of e-voting, Members may refer to the Help
& FAQs section/E-voting user manual available at the Download section on KFin’s
website: https://evoting.kfintech.com or contact Shri Rajkumar Kale, Assistant
Vice President, KFin Technologies Limited, Unit: Hindustan Media Ventures Limited,
Selenium Tower B, Plot No. 31 & 32, Financial District, Nanakramguda, Serilimgampally,
Hyderabad, Rangareddy, Telangana, India - 500032, Toll Free No.: 1800-309-4001, Email:
einward.ris@kfintech.com.
For Hindustan Media Ventures Limited
Sd/-
In every answer lies the very next question.
Date: November 27, 2023
Place: New Delhi
Nikhil Sethi
(Company Secretary)
You only grow when you ask better questions.
Get answers and updates on the latest business
news and its impact on us, only with Mint
Scan to watch the film.

hindustantimes htTweets www.hindustantimes.com

LIVEMINT.COM NEWS WRAP TuesDay, 28 November 2023
New Delhi 09

NEWS
49.24%
THE EQUITY stake LIC has in IDBI Bank. It
33
THE NUMBER of states in the US that have
$2,012.92
THE PRICE per ounce of gold in
₹1,000 cr
THE AMOUNT raised by private equity
40-50%
THE SUBSIDY that the Maharashtra
IN plans to hold a part of it even after the filed a lawsuit against Meta, which owns the spot market on Monday, the highest firm True North towards its maiden credit government is likely to provide on the
NUMBERS planned divestment to benefit from
bancassurance.
Facebook and Instagram, for illegally
collecting personal data of underage users.
in six months on weakness in the
US dollar.
fund, as it sees a large opportunity in
private credit over the next two decades.
proposed ₹500 toll charge for using the
upcoming Mumbai Trans Harbour Link.

HOWINDIALIVES.COM

TCS, AWS to launch TRADE WINDS Foxconn to invest

Gen AI practice $1.6 bn in India

T i
he country’s largest IT services exporter Phone maker Hon Hai Precision Industry Co.
TCS on Monday announced its tie-up plans to expand its footprint in India with
with Amazon Web Services to launch a another NT $50 billion ($1.57 billion)
dedicated generative artificial intelligence investment for construction projects.
practice. The Tata Group company recently The announcement, made in an exchange
announced that it has imparted foundation filing in Taiwan late on Monday, didn’t give any
training on Gen AI for 100,000 employees further details, saying only that the investment
across the world. was for “operational needs.” A spokesperson
The practice will focus on using responsible for the company declined to say where the new
AI frameworks and its “Paceport innovation facilities would be or what they would build.
hubs” to build a comprehensive portfolio of The news comes as Hon Hai, also known as
solutions and services for every industry Foxconn, and other Taiwanese electronics
sector, as per an official statement. manufacturers continue to diversify their
It has already bagged a customer, with the businesses outside of China as tensions rise
world’s largest hotel franchising company between Washington and Beijing.
Wyndham Hotels and Resorts extending its About half of Foxconn’s revenue comes from
strategic partnership with TCS and AWS to business with Apple Inc. The company has
manage its digital transformation journey. been making iPhones and other products in
TCS is at present focused on certifying over India for several years, including the latest
25,000 employees on AWS generative AI iPhone 15. BLOOMBERG
services. PTI

Visitors at Bharat Mandapam, venue of the 42nd India International Trade Fair at Pragati Maidan in New Delhi, on Monday. The annual fair, held from
14-27 November, reportedly hosted nearly 3,500 exhibitors from India and abroad. PTI

KKR’s Nayar is backing investment platforms

Rescuers to use manual drift Many state EV policies have announced specific
targets and timelines for e-bus adoption. HT
after 40 years in India’s financial circle.

KKR veteran Nayar

MINT

process for trapped workers Electric to be 11-13%

of bus sales: Icra
backs climate fund
E
lectric buses are expected to account for

S
anjay Nayar, a KKR & Co. veteran, is
backing a venture capital firm seeking to
raise as much as $250 million to invest in
climate tech startups.
Nayar joined as a general partner at Peak
Venture Advisors, that invests in companies in
sectors including new energy, food systems,
water and climate, he said in an interview in
up to 13% of new bus sales by FY25, rating
Auger machine debris removed; manual drilling of the passage to start soon agency Icra said on Monday.
Many state electric vehicle (EV) policies have
announced specific targets and timelines for e-
Subhash Narayan length of 1.5m of the 800mm wide passage. These workers. bus adoption, thereby creating a road map for
subhash.narayan@livemint.com lattice bars are now being cut. THDC has also started to construct a rescue tun- electrification, it noted.
NEw DELHI Earlier on Monday, the auger machine was cut nel from the Barkot end, with six blasts already With significant operational savings vis-à-vis
and removed by a plasma cutter. completed, resulting in a 12-meter drift. Three conventional diesel buses, Icra said it expects

Mumbai. The fund is seeking to raise money
from institutional investors, Nayar said.
Founded by Samir Shah, who ran a multi-
strategy hedge fund in Hong Kong for 10 years,
Peak Venture has already backed companies,
including Indra Water and Avant Wood,
according to information provided by the firm.
The Mumbai-based company has a team of
about 10 people and a pipeline of deals to
deploy capital over the next two years, Shah
said in an interview. Earlier this month, the
Securities & Exchange Board of India approved
Nayar as the general partner of the firm, in
which Shah is the managing partner, the
company said in a statement. The KKR veteran
is backing investment platforms after spending
40 years in India’s financial circle. BLOOMBERG
A
fter facing setbacks to the horizontal
drilling of the tunnel, rescue opera-
tions resumed in full swing on the 16th
day to save the 41 trapped workers at
Silkyara Tunnel in Uttarkashi with all
hope on manual drilling to reach the trapped
labourers.
All the debris of the auger machine, which had
been used for the last several days to create an 800
mm wide passage through the debris to reach the
trapped workers, has been removed and the pas-
sage created by the auger will now be drilled manu-
ally for around 10 metres to reach the workers.
This exercise will start after clearance of the 800
mm rescue pipe. After visual inspection by welders
it was found that the auger’s cutter had got entan-
gled with the lattice girder bars which damaged a
“After clearance of 800mm rescue pipe from all blasts per day are planned. RVNL is transporting the demand for e-buses to continue to rise.
the obstruction including stuck-up augers, manual machinery for micro-tunneling through horizon- “Icra foresees electric buses (e-buses) to be at
drift procedure will tal drilling to rescue the forefront of India’s electrification drive,
be applied to clear the labourers. with the segment expected to witness healthy
the last few meters to Five government agencies have been Five government traction going forward. Icra estimates e-buses
access the other brought in to look at all options to agencies have been to account for 11–13% of new bus sales by FY25,”
side,” a government brought in to look at it said in a report.
statement on the rescue the 41 workers trapped in the all options to rescue It expects government subsidies and
rescue operations Uttarkashi tunnel the workers. These evolving technologies to play a role in further
said. Simultane- include National reducing the capital costs involved in e-buses,
ously, a drift tunnel Highways and Infra- according to the report. PTI
is being created using Manual-Semi Mechanized structure Development Corporation Ltd
Method by joint team of THDCL, army, Coal India (NHIDCL), Oil and Natural Gas Corp. (ONGC), Sat-
and NHIDCL. Also, SJVNL’s machine for the verti- luj Jal Vidyut Nigam (SJVNL), Tehri Hydro Devel-
cal rescue tunnel construction has started its work opment Corporation Ltd (THDC) and Rail Vikas
and has already drilled over 30.8 metres or just Nigam Ltd (RVNL) have been assigned one option
Kronox Lab files IPO
over a third of the distance to reach the trapped each.
papers with Sebi

S
peciality chemicals company Kronox
‘High-dose covid Lab Sciences has filed preliminary
‘Tech to improve Delhi airport ops’ papers with Sebi to raise funds through
care less effective’ an initial public offering (IPO).
The proposed offer comprises a fresh issue
The airport, which is also the country’s of equity shares worth ₹45 crore and an offer-

A
higher dose of the steroid drug,
dexamethasone, may have less
beneficial effects for covid-19 patients
in India as compared with those in Europe,
according to a study published in The Lancet
Regional Health-Southeast Asia journal.
The study looked at how well a strong dose
of dexamethasone worked for covid-19
patients. It considered factors like patient
differences and health systems. The team,
including researchers from Copenhagen
University Hospital-Rigshospitalet, Denmark
found that bigger dose of dexamethasone (12
mg) did not seem to be as good as the usual
dose (6 mg) for covid-19 patients in India.
largest airport, handles around 1,300-
1,500 flights daily and expects to have
more than 70 million passenger traffic in
the current fiscal ending March 2024.
Currently, it has three terminals—T1, T2
and T3.
“We are looking at more digital
solutions, which can be IoT-
based...Artificial Intelligence-based
solutions...we will be using predictive
analytics for improved airport
operations,” Delhi International Airport
Last year, the airport saw congestion, leading Ltd (DIAL) CEO Videh Kumar Jaipuriar
to long waiting times. HT told PTI in an interview.
The Indira Gandhi International
for-sale (OFS) of 7.8 million equity shares by
promoters, according to the draft red herring
prospectus.
The estimated IPO size is ₹150 crore, as per
market sources. Vadodara-based Kronox is a
manufacturer of high-purity specialty fine
chemicals.
Its products find application in a wide
spectrum of industries for diversified uses
such as pharmaceutical formulations, active
A view of Myanmar’s Khawmawi village on the pharmaceutical ingredients, biotech,
India-Myanmar border. REUTERS scientific research and testing, nutraceuticals,
personal care, agrochemicals, animal health,
Myanmar rebels and metallurgy, among others. PTI

claim new territory

D
This was seen through survival rates and
how well people were doing after 90 and 180
days, they said. “Our analysis suggests higher
dose dexamethasone may have less beneficial
effects for patients in India as compared with
those in Europe; however, the evidence is
weak, and this could represent a chance
elhi airport will be using
predictive analytics based on
artificial intelligence as well as
camera-based solutions to improve
operations at the airport, which has seen
a rise in passenger traffic, according to a
top official.
Airport in the national capital is operated
by DIAL, a consortium led by the GMR
Group. Ganga Realty plans
E
Last year, during the winter season, thnic minority rebels fighting Myanmar’s
the airport witnessed significant
congestion, leading to long waiting times
military junta said they had seized a key
trading post on the northern frontier, across
₹1,000 crore project
for passengers. PTI the border from where China’s military was

finding,” the authors of the study noted.
Bangladesh arrests thousands in ‘violent’ crackdown: HRW
R
PTI conducting exercises to improve combat readiness
and emergency response.
A month of intense fighting between
Myanmar’s ruling military and an alliance of
ethnic minority insurgents has displaced tens of
thousands of people in the border region,
according to the United Nations, with concern
eal estate developer Ganga Realty on
Monday said it will invest more than
₹1,000 crore to develop a luxury
housing project in Gurugram, Haryana.
The company will build 302 apartments in
this project ‘Nandaka 84’, which is spread
over 8.33 acres, Ganga Realty said in a

B
angladesh has launched a sweeping and violent crackdown on
opposition parties to “eliminate competition” ahead of general
elections, including arresting almost 10,000 activists, Human Rights
Watch said on Monday.
As well as the thousands arrested, many are from the key Bangladesh
Nationalist Party (BNP), a staggering number also face charges.
According to the BNP, about half of its five million members “face
politically motivated prosecution”, HRW said. “The arrests, they are not
leaving anyone behind, from senior level to the ground level,” one activist
told HRW. Prisons are now at more than double their capacity, the rights
group said. The South Asian nation of around 170 million people holds a
general election on 7 January, with Prime Minister Sheikh Hasina eyeing her
fourth consecutive term in power. The BNP and other parties have held mass
protests calling on Hasina to quit power and let a neutral government run the
polls, demands the government has said are unconstitutional.
growing in Beijing about instability and an
influx of refugees. The rebellion has presented
the biggest battlefield challenge to Myanmar’s
well-equipped military since it seized power in a
coup in 2021. Emboldened by the northern
offensive, pro-democracy militias increase
attacks on security forces elsewhere in the
country. The “Three Brotherhood Alliance”, as
the insurgents call themselves, said they had
conquered several towns and the Kyin-San-
Kyawt border gate, one of five major trading
zones in the township of Muse opposite China.
Late last week, in the same area, a convoy of
goods trucks was set ablaze in what the junta
AFP About half of BNP’s 5 million members face prosecution. AFP called a “terrorist attack”. REUTERS
statement.
The housing project will be completed by
2028. Vikas Garg, joint managing director,
Ganga Realty, said the investment of over
₹1,000 crore will be funded through internal
accruals. The prices of the apartments and
penthouses start from ₹4.05 crore.
In March this year, Ganga Realty had
announced investments of ₹750 crore to build
an affordable housing project in Gurugram.
The company is developing 2,972
apartments in its project ‘Tathastu’, which is
spread over 22 acres in Sector 5, Sohna-
Gurugram. The price of the apartment starts
from ₹25 lakh. PTI
10 TuesDay, 28 November 2023
New Delhi LONG STORY LIVEMINT.COM

TALE OF TWO STATES:

wHAT numbers TeLL us
10 years on, the bifurcation has worked well for Telangana, but Andhra Pradesh finds itself in a financial quagmire

(Left) The Kaleshwaram Lift Irrigation Project on river Godavari, considered to be one of the largest in the world. (Right) The Palamuru-Rangareddy Lift Irrigation Scheme on river Krishna. They helped irrigate vast swathes of parched land in Telangana.

N Madhavan the same period, Andhra Pradesh’s per first challenge it took up was to fix the mint HOW AP AND TELANGANA STACK UP
Madhavan.n@livemint.com capita income grew to over ₹220,000 power crisis. A three-stage plan was con- SHORT
HyderaBad from ₹72,000. ceived. As a short-term measure, electric- STORY Andhra Pradesh Telangana
But a closer look reveals two different ity was purchased from power exchanges GSDP growth* (in %)

P
ower looms are noisy and the
sound, more than 100 decibels
that their rotating and sliding
mechanical parts make, over-
whelms when one enters almost
any street in Sircilla. This small town, with
a population of just 92,910, about 120 km
from Hyderabad, has as many as 30,352
weaving units. Most of them are small;
operating inside weavers’ homes, they
produce sarees and polyester cloth.
A visitor to the town 20 years ago would
tales. One of Telangana’s, a transformation
that was based on a clear vision, and the
other of Andhra Pradesh’s, where virulent
politics and inconsistent policies have
caused under-performance and fiscal
challenges.
As Telangana heads into its third assem-
bly elections on 30 November, it is on a
much stronger footing than Andhra Pra-
desh which will face the electorate next
year.
to reduce the blackouts. Simultaneously, GSDP (in  tn)
transmission lines were built to evacuate WHat 7.5 7.3
power from neighbouring Chhattisgarh, 7.1 7.2
which was a power surplus state. Thirdly, In 2014, Telangana formally
it began building large power stations. came into existence. Ten years
on, the bifurcation appears to 4.1 3.9
According to B. Vinod Kumar, vice chair- Per capita income, FY23 (in )
man, Telangana State Planning Board, the have worked— both Telangana
state with a capacity of 18,567 MW as and AP have grown at a faster 220,000
against 7,778 MW at the time of bifurca- pace than united AP.
tion, is power surplus today. 309,000
Two lift irrigation systems (where water
is pumped using motor) were imple- But 2013-14

Fiscal Discipline
2022-23

Debt, FY23 (% of GSDP)**

not have received a similar welcome as The Trigger mented—the Kaleshwaram Lift Irrigation
Telangana’s transformation
weavers then were in deep distress. With
falling orders, high yarn prices, rising O f the three regions of erstwhile undi-
vided Andhra Pradesh, Telangana
power costs and cheap imports, they remained underdeveloped. “It was a case
Project on river Godavari, considered to
be the world largest, at a cost of ₹1 trillion,
and the Palamuru-Rangareddy Lift Irriga-
was based on a clear vision.
However, in AP, virulent politics Revenue deficit/surplus,
FY23 (% of GSDP)
3.6 3.2

incurred losses and piled up debts. As of denied development,” says E. Revathi, tion Scheme on river Krishna that cost and inconsistent policies
caused under-performance
0.2 41% 35%
machines remained idle for most days, director, Centre for Economic and Social ₹35,000 crore.
Fiscal deficit, FY23
they were unable to repay the debts and Studies, a Hyderabad-based think tank. That apart, over 46,300 tanks were ren- and fiscal challenges. (% of GSDP)
many committed suicide. Others chose to Though bulk of the revenue was raised ovated at a cost of ₹20,000 crore over a -2.2
migrate elsewhere in search of menial jobs. from the Telangana region, which period of five years under Mission Kakat-
Things have changed since 2016. Weav- included Hyderabad, a smaller part was iya. These efforts irrigated vast swathes of NoW Capital outlay (% of total expenditure)*** Capex
( trillion)****
ers are back in business, thanks to large spent there. Hyderabad, by virtue of being parched land. 11
orders from the government of Telangana. the capital, saw major development but In addition, the government introduced The bane of populism has gotten 3.06
Between 2016 and 2023, the state pro- rural Telangana region remained ignored. Rythu Bandhu, a direct cash transfer worse. AP goes to election in 16 1.65
cured 58.56 crore metres of cloth valued at Agriculture was in distress as it was pre- scheme for farmers to meet the cost of April 2024 and the Opposition
₹2,758 crore. They also get power and yarn dominantly rain-fed in the absence of irri- inputs. As much as ₹65,559 crore has been has promised handouts such as * CAGR between 2013-14 and 2022-23; ** including off-budget borrowing; *** First half year average from 2016-17 to 2023-24
**** Completed capex between 2013-14 and 2022-23
subsidies. gation. spent in the last five years for the scheme. free LPG cylinders. It would
Sources: CSO data, state budgets, India Ratings & Research, PRS Legislative Research, CMIE
“I finally repaid last year the ₹5 lakh debt Between 1960-61 and 2014-15, the The impact? Gross irrigated area of all worsen state finances.
SARVESH KUMAR SHARMA/MINT
that I had taken nine years ago,” says quantum of irrigated land remained con- crops increased 117% between 2014-15 and
Gajula Mallesham, who operates 10 looms stant at 4.1 million acres (of the 12 million 2021-22. Total crop production in this
in his house. “We went through hell. cultivable land). This, despite the fact that period rose by 152%. Telangana has surplus in seven out of the last nine years. Mohan Reddy, the new government chose handouts will worsen the already precari-
Things are better now,” he adds. 86% of river Godavari and Krishna’s catch- become the largest producer of paddy in “The state has been borrowing only to to reverse many of the earlier policies. ous state finances.
This transformation ment areas were in Tel- the country. The Food Corporation of fund capital expenditure. Its quality of Amaravati as a capital was junked. The The recent arrest of Chandrababu
has triggered a reverse angana. The lower ripar- India (FCI), a public sector enterprise expenditure is thus very good,” says India focus shifted to welfarism. “Populism Naidu on corruption charges has also
migration. Workers At the time of bifurcation, ian regions of Andhra tasked with ensuring India’s food security, Rating’s Jasrai. began to take root and it was at the cost of made polity in the state worse. “Virulent
from Jharkhand and many feared a flight of and Rayalaseema bene- procured 13 million tonnes of paddy in “Stable policies, focus on development, investing in productive assets,” says Reva- politics and inconsistent policies unnerve
Odisha have found jobs fitted the most from the 2022-23. At the time of bifurcation, FCI creation of productive assets and keeping thi. The revenue deficit ballooned. In investors,” says Narayan.
in these weaving units capital from Telangana as two rivers. Massive procured just 2.5 million tonnes. welfarism at a level that did not hurt the 2022-23, it was ₹29,808 crore and ₹22,317 This can already be noticed. Not many
and in the textile and most businessmen were power cuts—the region Farm distress has eased. As per state state finances have been key to Telan- crore has been budgeted for 2023-24. The large investors appear interested in
weaving parks the state had a power deficit of crime bureau data, suicide by farmers have gana’s transformation,” adds Jayaprakash state resorted to borrowing to meet its cur- Andhra Pradesh. Young Liu, chairman of
government has set up in from the Andhra region. over 1,000MW at the dropped from 1,358 in 2015 to 352 in 2021. Narayan, former IAS officer and general rent expenditure. Foxconn, world’s largest electronics man-
the town. time of bifurcation— Mission Bhagiratha (water at doorstep) secretary, Foundation for Democratic Committed expenditure (spending on ufacturer, recently visited Karnataka, Tel-
Sircilla is the constitu- That wasn’t the case. meant that borewells scheme was launched with a budget of Reforms, a think tank. salaries, pensions and interest) as a share of angana and Tamil Nadu looking to make
ency of K.T. Rama Rao, were of little use to irri- ₹46,000 crore. Today, 95% of all house- state’s own revenue touched 136% in investments but gave Andhra Pradesh a
working president of the Bharat Rashtra gate. Farmer suicides were common. Peo- holds have tap water. The AndhrA sTory 2020-21. When the borrowing reached the miss. Local players such as Amara Raja Bat-
Samithi (BRS), Telangana’s ruling party, ple also had no access to drinking water.
and son of chief minister K. Chandrashe- Debilitating power cuts—six hours a day
kar Rao. and a two-day power holiday—meant that
At the time of bifurcation, many feared
a flight of capital as most businessmen
were from the Andhra region. One of the
T he opposite is true when it comes to
Andhra Pradesh. “While it may be true
that the state got the raw end of the stick in
limit as per the Fiscal Responsibility and
Budget management (FRBM) Act, it
resorted to off-budget borrowings. In
teries have chosen to invest heavily in Tel-
angana. The state government, however,
claims that its Global Investors Summit,
Sircilla is clearly a beneficiary of the there was hardly any industrial develop- first steps that Chandrashekara Rao took the bifurcation, better governance would 2021-22, it raised funds through Andhra held in March this year, raked in invest-
bifurcation of Andhra Pradesh. In 2014, ment and unemployment was rife, espe- was to meet up with the industrialists and have helped it to do well,” says Narayan. Pradesh State Development Corporation ment commitment worth ₹13.42 trillion.
The Andhra Pradesh Reorganisation Act cially among the youth. assured them of support. The economic The raw deal he refers to is Hyderabad, by securitizing future revenue from liquor The Andhra Pradesh government,
got the presidential assent and Telangana There were reasons for this skewed hub of Hyderabad needed to thrive and a region that generated bulk of the revenue sales in 10 zones. Both the central govern- despite several attempts by Mint, did not
formally came into existence on 2 June development. Seemandhra, with 175 assem- generate the resources to develop the rest for undivided Andhra Pradesh, remaining ment and the Reserve Bank of India, respond to requests for meetings.
that year. The two other regions, Coastal bly seats in the state assembly, was politi- of Telangana. with Telangana. It was also the region that India’s central bank, came down heavily on Meanwhile, in Telangana, a resurgent
Andhra Pradesh and Rayalaseema, also cally more empowered. Telangana had just He continued with the investor-friendly was the base of the state’s industrial and the state and mandated that such off-bud- Congress, fresh after tasting victory in Kar-
called Seemandhra, remained with 120 seats. Also, strong political leaders policies of earlier governments. Software service sectors. The union government get borrowings will be added to the fiscal nataka, is giving a tough fight to BRS which
Andhra Pradesh. Ten years on, the bifurca- emerged from Seemandhra and this meant exports rose from ₹57,258 crore in 2013-14 then went back on its promise for a special deficit. This created a cash flow crisis, forc- is facing anti-incumbency in the state
tion appears to have worked, if one looks at policies favoured that region. At the time of to ₹2.4 trillion in 2022-23. The number of package for Andhra Pradesh. This meant ing the state government to hold back all assembly elections due on 30 November.
the broad numbers. Both Telangana and bifurcation in 2014, nine out of 10 districts in workers in the IT sector grew from the state inherited a relatively weak fiscal payments including salaries. Outstanding The youth are unhappy as they are unable
Andhra Pradesh have grown at a faster Telangana were classified as backward. Two 323,000 to 906,000 in the same period. position. Such a situation needed cali- debt as a percentage of GSDP, including to find jobs, especially in the government.
pace than united Andhra Pradesh. of them, Khammam and Mahbubnagar, Investments worth Rs ₹4 trillion have been brated policies. off-budget borrowings, will touch an The Kaleshwaram project is mired in a
“Between 2013-14 and 2022-23, Telan- were termed as ‘most hungry’ by the Plan- committed or realized. The Telugu Desam government that alarming 42% of GSDP in 2023-24. controversy involving engineering lapses.
gana’s economy grew at a compounded ning Commission. It was these factors that “Telangana is a rare example of inte- came to power in 2014, hurt by the loss of The bane of populism has just gotten The opposition has accused the BRS gov-
annual growth rate of 7.2% and Andhra fuelled the demand for a separate state. Tel- grated, holistic, inclusive and balanced Hyderabad, chose to spend a lot of money worse. Chandrababu Naidu, who had ernment of corruption too.
Pradesh by 7.1% as against all India rate of angana Rashtra Samithi (TRS), as BRS was development,” BRS working president on building a new capital at Amaravati. The eschewed freebies and focussed on devel- “People of Telangana believed that the
5.6%. Their growth was higher than undi- earlier named, under Chandrashekar Rao, K.T. Rama Rao tells Mint. “We have state’s fiscal deficit exceeded 4% between opment till now, recently announced first bifurcation would be a miracle for them,
vided Andhra Pradesh’s 3.9% between capitalized on this disenchantment and focussed on both development and wel- 2015-16 and 2017-18. Former chief minister of his many manifestos (Andhra Pradesh and people of Andhra Pradesh believed it
2011-12 and 2013-14,” says Paras Jasrai, protested under the theme ‘water, finance, fare, rural and urban areas, industry and N. Chandrababu Naidu’s reform creden- goes to election in April 2024) that prom- would end up in a disaster for them,” says
senior analyst, India Ratings and Research, employment’. They succeeded in 2014. environment, apart from IT services and tials and investor friendly image did attract ises handouts such as free LPG cylinders, Narayan. “So far, it has been neither, but
a credit rating agency. agriculture,” he adds. “None of our 33 dis- some investments, the most prominent monthly cash assistance for women, moth- the jury is still out and the outcome of the
Per capita income of both states has The TelAngAnA sTory tricts is classified as backward now.” being South Korean car maker Kia. When ers and unemployed youth. “Naidu has no upcoming assembly elections in both the
risen. Telangana’s from ₹85,000 in
2012-13 to over ₹309,000 in 2022-23. In W hen TRS won the mandate to form
the first government in 2014, the
The state has achieved this without any
financial stress. It has managed a revenue
Naidu lost elections in 2019 and YSR Con-
gress came to power under Y.S. Jagan
choice. He has to follow the trend to
remain relevant,” says Narayan. Such
states will play a big part in how things will
pan out going forward,” he adds.
LIVEMINT.COM MINT MONEY TuesDay, 28 November 2023
NeW Delhi 11

Get rewarded for UPI payments THE MONEY

MIND
with virtual Rupay credit cards VIVEK KAUL

We welcome your views and comments at

mintmoney@livemint.com

PERSONAL FINANCE
Consumers can ask their banks to issue a virtual Rupay credit card that can be linked to their UPI accounts
AND A LESSON FROM
Shipra Singh
shipra.singh@livemint.com The convenience of credit card payments through UPI
ers with the credit card and use it to
pay utilities on Amazon Pay.
Limitations
HARRY HOUDINI

U
PI, or Unified Payments Earn rewards on daily spends by Only customer-to-merchant UPI
How you can earn more

Interface, is increasingly
becoming the preferred
method of payment for
all types of transactions.
Last year, the Reserve Bank of India
(RBI) permitted the linking of Rupay
credit cards to UPI accounts, thereby
allowing the plastic to be used for
smaller transactions as well. Most
major banks now offer Rupay credit
cards that can be linked to your UPI
account, irrespective of the category
of the card. But, will existing credit
card holders have to get a separate
Rupay card just to avail the UPI pay-
ment option? No, one can get a virtual
Rupay credit card in just a matter of a
few hours.
“If a customer has a credit card on
networks such as MasterCard or Visa
and wants a Rupay equivalent to
make UPI payments, they can ask the
bank for a virtual card,” said Freder-
ick Dsouza, business head-credit
card, Kotak Mahindra Bank.
Most banks are offering virtual
only card option now. It is a separate
card and its credit limit is within the
overall limit assigned to the primary
card that the customer has. “Custom-
ers who show interest specifically in
UPI transactions see value in these
virtual cards as they don’t want to
swipe them at points of sale (POS)
machines,” said Dsouza.
How you benefit
The biggest pull of the UPI pay-
ment method is convenience, which
is now available to credit card users as
well. “In tier II and below cities, not
every small merchant has a POS
(point of sale) machine, whereas even
a roadside snacks stall now has a UPI
QR code. All such small payments
that a credit card holder had to earlier
compulsorily make from their bank
savings account can now be directed
D
using your Rupay credit card payments are allowed through credit ear reader, have you ever heard of someone called Erich
reward points cards. This is done to ensure that peo- Weisz? Probably not. To be honest, even I had never heard
Ramesh* uses Tata Neu Infinity HDFC credit card for all ple don’t revolve credit by transfer- of him before I started writing this piece. But you have
CREDIT cards have reward his UPI payments. At 1.5% base reward rate, in a month…
ring money to bank accounts of probably heard of Harry Houdini, who lived through the late
points, but not UPI functionality friends and relatives. “Any payment nineteenth and the early part of the twentieth century. In fact,
He earns ONLY merchant
He spends () Neu coins UPI IDs accept being made to a UPI ID or QR code after becoming a professional magician Weisz started calling
BUT RBI has since allowed payments made that belongs to an individual and not himself Houdini. Of course, Houdini was much more than just a
Rupay cards to use UPI 3,000 on commute by auto 45 with a credit card. If a merchant will not show credit card magician. As his Wikipedia entry points out, he was an “escape
1,800 on vegetable 27 a vendor gives his as a payment option,” said Mandal. artist, illusionist, and stunt performer, noted for his escape acts”.
personal UPI QR/ID, So, for instance, if an auto driver One of Houdini’s famous acts was to invite the strongest man
THIS enabled Rupay users
1,000 on haircut 15 you will not be offers his personal and not business in the audience onstage. He claimed to be an amateur boxer and
to get reward points*
able to use the UPI QR code for payment, then you said that he could withstand any man’s punch without really
2,000 on Kirana shop 30 credit card
can’t pay for your ride using a credit flinching. This story is recounted by Morgan Housel in his new
BUT Visa/Mastercard users
3,000 at Bigbasket 100 5% cashback earned card. book Same As Ever. As Housel writes: “The stunt matched what
were left out
on Tata Brands Even though UPI payments people loved about his famous escapes: the idea that his body
1,000 at street food joint 15 through credit cards have fared well could conquer physics.”
BANKS have innovated by 1 Neu coin = ₹1 since its launch, some big merchants After one such show in 1926, Houdini invited a bunch of stu-
creating virtual Rupay cards Total spends 11,500 232
have stopped accepting payments dents to go backstage with him. This included an individual
through this option. That includes called Gordon Whitehead, who walked up to Houdini and started
He earns 2% cashback on his regular UPI spends, IRCTC and Mother Dairy, said Man- punching him in the stomach without any warning. He was being
THESE are linked to existing which he will not get by swiping a card
Visa/Mastercard cards dal. This is because payments playful and thought he was recreating the same trick that he had
*It's a hypothetical example through credit cards carry Merchant just seen Houdini perform on stage. The trouble was Houdini
*On merchant UPI transactions
Discount Rate, or MDR, cost—a fee wasn’t prepared for the punches that came. In the normal scheme
that a business has to pay to a bank or of things, he would be flexing his solar plexus, steadying his
PARAS JAIN/MINT
card company that processes its card stance and holding his breath. But at that point he wasn’t. As a
to credit cards,” said Kashif Ansari, and not so much for rewards. That of 500 Neu coins or ₹500 can be or digital transactions. In regular UPI result, Houdini’s appendix ruptured and then he died.
assistant professor of finance at O.P. said, there is scope for rewards via earned as cashback in a month on UPI payments, merchants don’t have to This, as Housel writes, was a person who was tied in chains and
Jindal University. cashback on such small spends. spends. At the base reward rate of pay MDR. “Businesses have to pay thrown into the river and came out alive. He was buried alive in
Even for online shopping where For instance, Tata Neu Infinity 1.5%, this means you can earn rewards 1.7-2% in MDR, which is higher than sand and could escape in seconds. All because Houdini while per-
credit cards are accepted, transacting HDFC credit card currently offers an on spends of up to ₹33,500. To be fair, what is charged on POS credit card forming his stunts was prepared and
with UPI is more conve- attractive reward rate of utilities and groceries for most people transactions,” said Mandal. Investors need had a plan. But Whitehead’s punches
nient as one doesn’t 1.5% on almost all don’t usually exceed this amount Does this deter higher acceptance to know that the took him by surprise. He got punched
have to enter card spends, barring rent, every month. of credit card-linked UPI payments
details or OTPs (one-
Only payments
made by EMI payments, wallet “Neu coins can be used to recharge by merchants, Dsouza said it is not a biggest risks are when he wasn’t expecting to be
punched. The point Housel is trying to
time passwords) for customers to a loads, fuel, government your phone and at most Tata outlets, big concern as daily UPI spends are always those make through Houdini’s story is that
every transaction. merchant’s UPI categories, such as tax like Bigbasket, 1mg, etc.,” said Ansari. usually made to small merchants. that one doesn’t the biggest risks are always those that
Like all other credit
account are payment or NPS, and All other Rupay credit cards earn “There’s no MDR for a UPI transac- see coming one doesn’t see coming. Such is life.
card payments, you get insurance. Getting a rewards on regular essentials tion of ₹2,000 and below made using And herein, as we shall see, lies one the
an interest-free repay- allowed through Rupay variant of this spends, but the reward rate is high- a Rupay credit card. For small mer- biggest lessons in personal finance.
ment window of up to credit cards card can earn you ₹1.5 on est with Tata Neu Infinity HDFC chants, this ticket size is sufficient as When the covid pandemic broke out, many individuals lost
45 days and earn every ₹100 spent on all credit card. Some cards don’t pay most payments they receive may not their jobs. Quite a few youngsters had next to no savings because
rewards on each spend, small daily payments, rewards on utilities or groceries, so cross this limit. In my opinion, this they had assumed that they would continue to work, continue to
if available on the card. such as groceries, commute fare, veg- check the exempted categories on segment is the most sensitive to MDR get a salary and continue to spend money. But then that’s not how
Sumanta Mandal, founder, Tech- etable vendor, utilities, etc. While your credit card as these UPI spends charges and they largely remain unaf- it worked out. The pandemic was a risk which almost no one
noFino, said UPI transactions are each UPI payment might be a paltry won’t earn you rewards. For cards fected. Large merchants accept credit could see coming. It was an unknown unknown—human beings
generally very small, so credit card ₹50-100, these spends add up over that exempt utilities, a workaround cards through POS machines and will did not know that they did not know that this would happen.
users will use it more for convenience the month (see graphic). A maximum is that you can buy Amazon vouch- pay MDR in any case,” said Dsouza. So, it always makes sense to have some money in savings bank
accounts and fixed deposits. The proverbial rainy day may not
come, but if it does you will be prepared for it. As Housel writes:
“It’s better to have expectations that risk will arrive, though you

How to get heavy discounts on EMI purchases sans the EMIs don’t know when or where…So, in personal finance, the right
amount of savings is when it feels like it’s a little too much.”
Along similar lines many people with dependents don’t buy
ISTOCKPHOTO term insurance, simply because they think that an accidental or an
Shipra Singh chase into EMIs, he was get- neer. He opted for EMIs at the allow customers to prepay per- early death is something that happens to other people. Then there
shipra.singh@livemint.com ting a significant upfront dis- time of purchase to get a sonal loans by charging a fore- are others who argue that if they live out the term of the insurance,
count and the convenience of ₹1,200 upfront discount on closure fee. The fee can be the premium paid is wasted. Well, the premium paid is not wasted,

T
hese days, ecommerce
firms offer hefty dis-
counts on consumer
products if you opt for equated
monthly instalments (EMIs) on
credit card purchases. But,
what if you do not prefer the
EMIs and would rather have
only the discounts? Some peo-
ple have come up with a clever
workaround for this.
Noida-based Narayan
Kumar was recently offered a
sweet deal on a refrigera-
tor–15% upfront discount by
converting the purchase into
credit card EMIs . On a listing
price of ₹98,000, he could buy
the fridge for ₹85,000 net of
processing fees and tax and
save ₹13,000. The deal was
simple–by converting the pur-
paying back the amount over
16 months. But, the 51-year-old
had a better plan.
After buying the fridge and
paying the first instalment, he
had the EMIs cancelled to
avoid the interest. “I called my
bank RM (relationship man-
ager) and got the EMIs can-
celled. He even waived any
foreclosure charges,” said
Kumar. After accounting for
the processing fee and the
total interest he would pay at
12% rate, his effective savings
would have reduced to just
₹3,589 instead of ₹13,000.
“This was the second time I
got the EMI cancelled on a
purchase. This was entirely
possible due to my over 25
years of banking relationship
and 17 years as a premium
credit card member with my
bank,” he Kumar.
If the loan ticket size is
small, you don’t even need a
banking relationship for this
workaround. In Bengaluru,
Sumit Nathany was able to
cancel EMIs on his earphones
in under one minute by just
calling the customer care
helpline of his bank. “They not
only cancelled the EMI but
also reversed processing fee
and taxes of ₹235,” said the
35-year-old software engi-
earphones worth ₹6,740. waived off if the bank RM it’s the cost of being prepared for a risk that may never arrive.
Many like Nathany and accepts your request. So, after In fact, the entire act of diversifying investments fits in beauti-
Kumar are putting to good use you have purchased an item on fully here. Quite a few individuals chase performance, depending
a rule around EMIs to get a dis- on whatever is the flavour of the season. When bitcoin and crypto
foreclosure of Many customers count, you can call were fashionable some youngsters bet a good part of their savings
loans to get heavy are opting for up your bank and on it. It looked good while it lasted and made those who had
discounts on pur- foreclosure of get the loan can- money in fixed deposits, look stupid, at least briefly.
chases. EMI loans and celled. You get to Of course, while the going was good for crypto, those who had
It is common keep the discount money in fixed deposits earned very low-returns in comparison
waiver of
for banks to offer and don’t have to to those who were busy punting crypto. But then that was the cost
15-20% discounts processing fees pay any interest on of being ready for the risk that could arrive someday. And it did,
on electronic by their banks the loan. in the form of crypto prices crashing, scams being revealed and
appliances and “I’d initially governments cracking down on it. While all these things could
other big ticket bought the ear- be predicted in advance, no one knew when they would play out.
items if you buy them on EMIs. phones at the listed price as I Further, many investors like to wait for forecasts before they
The offer sounds tempting to wasn’t comfortable with EMIs start planning for risks. While it is not very difficult to identify
the consumer but in most cases, just for a discount. Soon after, I most risks that can shut down a good investment story, almost no
the math works out in the bank’s came to know that EMIs can be one knows when a risk is likely to play out. Which is why it is
favour as it extracts processing cancelled easily so I cancelled important to remember something that Nassim Nicholas Talen
fee and interest of 12-20% that my first order and repurchased writes in The Black Swan: “Invest in preparedness, not in predic-
offsets the discount. But, here’s the same item on EMIs to get tion. Remember that infinite vigilance is just not possible.”
the catch. Most major banks the discount,” said Nathany. Vivek Kaul is the author of Bad Money.

Returns on my investments How do you invest in GIFT City ETFs?

Building a portfolio is a complex exercise, and it has to be maintained too. A person’s portfolio holds different types of assets based
on her financial goals, and each asset class gives different types of returns, which is why a portfolio must have an ideal mix of AFP
financial products. One must also keep in mind the volatility risk of the asset class, liquidity, lock-in rules and taxation. Here's a look Vivek Banka the money is invested through
at how four commonly used asset types—equity, cash, gold and fixed income—have done in different periods. brokers registered outside of
How do you invest in GIFT the Gift City. In terms of
City’s exchange-traded investment options, ETFs
funds (ETFs) which is might be a better option as the
16re.tu1rn0th%at Returns (in %)
Equity (Sensex) Cash (liquid fund)
exempted from capital
gains tax? Which company
fund manager would deploy
the money into various ETF’s
The iven or index would be issuing globally basis their conviction,
Gold has g-year
Gold Fixed income (fixed deposit)
the ETF? What is the ideal while PMSes (porfolio man-
over a oned duration and amount in agement services) would most
perio case of a one-time invest- likely handle the end invest-
ment? ments themselves.
16.10 —Parthiv Thakkar The investment methodol-
14.41 14.59 ogy has to be similar to how we
13.54
12.56 Indian citizens have many play longer-term investments.
options for investing abroad. ASK MINT limited as very few companies A staggered investment in case
9.00 For one, they can put their m INVESTMENTS such as Marcellus and Phillip of regular inflows works best
8.01
7.33 6.81 6.73 6.80 6.39 money in mutual funds that Ventures have currently set up as these help average out
6.10 invest outside of India. The shop. investments, especially in the
4.76 5.00 5.03
advantage is ease of transac- cient taxation if they invest via The minimum investment context of major geopolitical
tion but taxation is at slab rate GIFT City. If the ETF that you in this is $150,000 and should events currently and forth-
for those in high tax slabs. are investing is in global stocks be within the annual LRS lim- coming.
They can open a broking then the taxation would be at its. In terms of retail resident Vivek Banka is co-founder,
account with a foreign broker. 20% with indexation if the individuals, considering the GoalTeller
This will help large investors holding period is more than 24 minimum entry points,
seeking flexibility of spreading months and at Indian capital mutual funds might still be Do you have a personal
1 YEAR 3 YEARS 5 YEARS 10 YEARS
their investments across vari- gains if the investment is in best. However, individuals finance query? Send in your
Data as on on 23 November 2023. Equity is the benchmark Sensex return (price); cash refers to the average return for liquid funds category as ous asset classes, but be wary Indian stocks. etc., making it who can deploy $150,000 queries at
defined by Valueresearchonline; gold refers to domestic gold prices available on Valueresearchonline; and fixed income is historic SBI fixed of the hassles of paperwork, more efficient than the other have a great opportunity to mintmoney@livemint.com
deposit rates. All returns are annualized. and get them answered by
taxation and liquidity. tax modes above. Do note that invest in a vehicle that has a
SATISH KUMAR/MINT Source: S&P Dow Jones Indices,Value Research,SBI industry experts.
Individuals have a more effi- investment opportunities are much better taxation than if
12 TuesDay, 28 NovemBer 2023
New Delhi VIEWS LIVEMINT.COM

OUR VIEW MY VIEW | TIGhTROpE WAlk

ISTOCKPHOTO

Be wary of the hidden costs that

terror attacks end up extracting
Inertia means ritualized anti-terror measures of dubious efficacy often get to take an endless toll

hospital. Every new security organiza- This phenomenon is not unique to

tion created deprives the nation of
thousands of personnel who could have
been gainfully employed elsewhere.
This requires billions of dollars of capi-
tal and operational expenditure in per-
petuity. The recent loss of five young
lives of our elite special forces is a
reminder of Pakistan’s “return of invest-
RAGHU RAMAN ment” on terror as a strategy. But it
is former CEO of the National Intelligence doesn’t end there.
Grid, distinguished fellow at Observer Apart from this huge calculable out-
Research Foundation and author of flow, there are several other costs that
‘Everyman’s War’. the nation pays. Loss of opportunity for
the government. All major organiza-
tions have similar rituals created in an
erstwhile era for an erstwhile purpose.
Yet, over time, these pointless rituals
attain sacrosanct status, beyond ques-
tioning. Despite seismic social changes
and the advent of technologies like
machine learning and AI, not to speak of
concomitant social changes, especially
among the young, we see the persist-
ence of old organizational structures,
annual appraisals, top-down communi-
cation, an over-emphasis on academic

Farm to fork: Conscious

tourism, raising of insurance premiums, credentials, one-size-fits-all training
lowering of investor confidence in a programmes and other outdated man-

F
ifteen years ago, today was the day country seen to be dangerous, and the agement practices. For instance, there
when nine of the 10 terrorists who psychological impact of all-pervasive is often a greater focus on measuring an
attacked Mumbai were liquidated surveillance and security measures, employee’s physical presence in the

eating can cut emissions and the NSG began its mopping-up
operations, ending Operation Black
Tornado on the morning of 29 Novem-
ber. But the damage continues till date
apart from its corrosive effect on
democracy, are all incalculably costly in
the long run. On top of this is the loss of
velocity of virtually all movement, be it
office rather than her intellectual con-
tribution. Rather than evolving struc-
tures that encourage collaboration,
companies still implement frameworks
and probably will in perpetuity. of goods, people or money, congealing like performance bell curves that foster
Terror attacks are a weapon of war the flow of the global economy. Aircraft fratricide. Employees who work
Aiming for net zero, the UN’s FAO wants people in the rich world to eat less meat. We need to and the principal strategic objective of have lower utilization because of secu- 14-hour shifts are lauded, while firms
all wars is damaging the adversary eco- rity delays, cash registers in malls slow, should worry about a sure deterioration
discuss this sticky aspect of climate change without any guilt or stigma slapped onto diets nomically. While the 26/11 attacks on and there is a ‘security surcharge’ that in their quality of life and thus work
Mumbai caused about 170 fatalities, we pay. It is like throwing a handful of contribution. There is ‘sanctioned’ dou-
hundreds of injuries and millions of dol- sand into a well-oiled machine. ble speak between articulated cultures
lars of property damage, that was tiny Many measures that are deemed nec- and unarticulated expectations.

A
s the next Conference of the Par-
ties (CoP) to the United Nations
Framework Convention on Cli-
mate Change approaches, news
has emerged that the UN’s Food
and Agriculture Organization
(FAO) is set to present a plan on emission reduc-
tion that will include dietary advice for the rich
world, asking its people to curb their meat
intake. The average American consumes about
127kg of it annually, although under 16kg is
considered healthy and people in some poor
countries average less than 4kg. As CoP-28
begins in Dubai later this week, a restraint advi-
sory for heavy consumers is likely to be part of
an FAO roadmap for the global agrifood indus-
try to align itself with the Paris pact’s goal of
keeping our planet no warmer than 1.5° Celsius
above its pre-industrial level. The FAO has said
that about 14% of all greenhouse gas emissions
on account of human activity come from meat
and dairy production. That’s quite a chunk. As it
involves people’s diets, discussion of it has been
sparse. But no major source of emissions can be
affects the climate for hundreds of years. But
the former does its damage swiftly. Going by
what’s known of its ‘global warming potential,’ a
metric used by the Intergovernmental Panel on
Climate Change (IPCC), one tonne of methane
exhaust is likely to be the equivalent of over 25
tonnes of carbon dioxide over the course of a
century. There is also an estimate of the heat
caused by the gas. The 2021 Sixth IPCC Assess-
ment Report says that anthropogenic methane
accounts for almost a third of the planet’s
warming observed so far. Among livestock,
these emissions are the gaseous waste product
of digestion. A 2018 study found sheep, goats,
beef cattle and buffaloes to be big emitters.
Among the solutions proposed are methane
mitigation paths for large-scale cattle farms,
which could opt for dietary and rumen manipu-
lation of animals, manure intervention and
other practices. Laboratories and food chains in
the West have also begun churning out all kinds
of synthetic meat. Proposed substitutes include
cultured meat, which uses technology to pro-
duce animal muscle cells through tissue culture
compared to its long-term impact. essary are not necessarily effective. Fif- In February 2021, while advocating
Any government reeling under a teen years later, barring airports and the need for change, Prime Minister
shock like 26/11 or the 9/11 attacks in the perhaps a few government installa- Narendra Modi cited the story of
US, or 7/7 in London, deploys a slew of tions, anti-terror measures are largely a Churchill’s Cigar Assistant. This was a
security measures in its aftermath. The farcical ritual that do not really improve post created in the chief secretary’s
modus operandi of the last attack drives security. Take, for example, the ritual of office of Tamil Nadu to ensure a supply
the design of most counter-measures; checking of cars before entering hotels of cigars to Winston Churchill, who was
so every hotel, airport, mode of public or malls. The mechanistic action of particularly fond of cheroots from Tiru-
transport, mall, shopping centre and opening the vehicle’s hood and trunk chirappalli. Though Churchill lost polls
theatre now has baggage and car scan- and running a mirror under and a dog in 1945 and India won its independence
ners, metal detectors, sniffer dogs, turn- along its sides achieves nothing. Yet, in 1947, this post continued for several
stiles and a massive increase of security this rite happens millions of times every decades, and only came to light after the
personnel. Internal security, which day. Likewise, every man, woman and state government set up a commission
already accounts for a substantial por- child being frisked before being allowed to revise employee salaries! There are
tion of government expenditure, is into a public place is irrelevant; all the probably millions of ‘Churchill’s Cigar
ramped up exponentially, diverting attackers of 26/11 actually stormed into assistants’ in our professional and per-
funds meant for developmental pur- their target hotels firing weapons. The sonal ecosystems who have long lost
poses towards a largely non-productive next terror attack will not follow previ- their relevance, but still drain scarce
purpose. Every baggage scanner means ous attack vectors, and yet, once a ritual resources because it’s easier to go along
an X-ray machine less, every metal has begun, it is nigh impossible for it to with the status quo than to challenge it.
detector means one less ventilator in a be stopped or rationalized. But it’s a very expensive way to go on.
www.livemint.com
New Delhi, Mumbai, Bangalore, Kolkata, Chennai, Ahmedabad, Hyderabad, Chandigarh*, Pune* Thursday, November 28, 2013 Vol.7 No.283 `3.00 in Delhi­NCR/`4.00 outside Delhi­NCR 28 PAGES
24

left out in the race to arrest global warming. in a laboratory. Food innovation in the West BUSINESS OF LIFE: Indian
cricket’s new order >12­13

Not all of the food sector’s emissions are from
animal food chains. According to one study,
looks increasingly likely to explore ways of CONTENT PARTNER
POLICY: To rein in fiscal deficit, govt
cuts education spending by `4,000 cr >8
MARK TO MARKET: Wockhardt receives
another blow from US drug regulator >14
VIEWS: India’s Goldilocks problem >23
We are dependent on
retaining high-meat diets without the world’s SENSEX 20,420.26 æ 4.76

APPLICATION WITHDRAWAL
NIFTY 6,057.10 æ 2.00 DOLLAR `62.21 æ `0.29

SIGNS OF RECOVERY?
EURO `84.64 ® GOLD `30,570 æ `170

Trai comes out QUICK EDIT

OIL $110.72 Æ $0.06

the natural world for every

Tatas pull The Indian economy is expected to show signs of a recovery in the second
quarter of the current fiscal year on the back of a moderate recovery in factory
with mobile One more

these account for about 57% (including live- gaseous heat trap worsening. If cattle rearing to
output and robust exports growth. Economic growth slumped to a decade’s low banking tariff rising risk

breath of air we take and

at 5% in the year ended 31 March. In the June quarter, India’s gross domestic
product expanded at 4.4%, the slowest in four years. All eyes will be on
government data for the September quarter to be released on Friday. limit, guidelines ust two days ago,

out of bank 7.5

6.5
6
GDP growth (in %)
B Y S HAUVIK G HOSH
V IDHI C HOUDHARY
·························
NEW DELHI

T
& J global oil markets
heaved a sigh of relief
at the resolution of a
potential crisis in the

stock feed), while 29% can be traced to plant- feed the West can be scaled down, sustainability
he Telecom Regulatory Au- Middle East. The problem

licence fray
5.4 5.2 thority of India (Trai) an- may emerge elsewhere.
5.1 nounced consumer-centric rec- Within days, a new hot
4.7 4.8

every mouthful of food

4.4 ommendations as well as a tariff spot is emerging, this
order on Tuesday that will help time in the East China
the cause of financial inclusion Sea. China had declared
by enabling mobile banking, a so-called air
curb monopolies in cable net- defence identification
works, and allow people re- zone over a group of
Tata Sons indicates its

based foods and 14% to other related activities. could well come within sight for this sector. In
remained same as Chandi- sponding to an emergency (such contentious islands in the
current model best garh-based KC Land and Fi-
nance Ltd, whose name was
as floods) keep in touch.
In a conference on the new
area. On Tuesday, two US
military aircraft flew over
supports the needs of inadvertently not included in mobile banking regulations on the zone, prompting a
the group’s domestic the list of applicants released Wednesday, Trai chairman, Ra- Chinese general to say

we eat. But it’s even more

on 1 July, found place in the hul Khullar said the aim is to that hostile aircraft could
and overseas strategy list. Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
keep costs low and enable access be shot down.
2011-12 2012-13 2013-14
Other companies that are in across the country. The sabre-rattling—
B Y D INESH U NNIKRISHNAN & the race for a new banking li- The telecom regulator’s mo- common enough between
GDP growth projections for 2013-14

What makes livestock stand out, especially India, the methane story differs, as livestock
A NUP R OY
·························
MUMBAI
cence include L&T Finance bile banking recommendations China and Japan—marks
Holdings Ltd, Religare Enter- Earlier 5.5 included guidelines on unstruc- a new, potentially risky
prises Ltd, IDFC Ltd, Indiab- HSBC tured supplementary service twist on a fraught
Present 4

T he Tata group withdrew

its application for a
banking licence, months
before the Reserve Bank of In-
ulls Housing Finance Ltd, In-
dia Infoline Ltd, Magma Fin-
corp Ltd, Edelweiss Financial
Services Ltd, India Post—the
Nomura
4.2
5

5.2
data (USSD)-based mobile bank-
ing services. USSD services ena-
ble an operator to communicate
with users, as is the case with
situation. China’s
newfound aggressiveness
marks an escalation of
tensions that have

that we are also dependent

dia (RBI) is expected to open Indian government’s postal BNP Paribas Airtel’s *121# service. Users can remained contained until
up the sector to a new set of department—and microlend- 3.7 perform basic banking opera- now.

cattle, is the methane generated by farms that rearing is small and unorganized, with red meat
new private banks in Asia’s
third largest economy.
Tata Sons Ltd, the holding
company of the Tata group,
said in a statement that its
“current financial services op-
erating model best supports
the current needs of the Tata
group’s domestic and overseas
ers Bandhan Financial Services tions through this. One cannot blame the
5.1
Pvt. Ltd and Janalakshmi Fi- JP Morgan “We have come out with a US intrusion as reckless.
nancial Services Pvt. Ltd. 4.1 framework to help bank agents China’s continuous
Higher capital requirement to interface with service provid- nibbling of territory
5.5
in the form of statutory liquidi- Standard Chartered ers for the use of SMS, USSD and claimed by other
ty ratio (SLR) and cash reserve 4.7 IVR (interactive voice response) countries is the original
ratio (CRR) applicable to the reason for the problem.
Source: CSO, Mint research
new banks from inception is a TURN TO PAGE 5®
NAVEEN KUMAR SAINI/MINT
deterrent for NBFCs, with ex-

rear these animals. This is a gas that gets far less eaten in low quantities per capita. While the
strategy, and provides ade- isting loan books to seek a

on it for our sanity and

quate operating flexibility to its banking licence, analysts said,
companies, while securing the
interests of the group’s diverse
even as the mobilization of
cheaper deposits will take Nasdaq’s climb DIGITAL MONEY
stakeholder base”.
RBI said in a press release
years.
CRR is the portion of depos- reflects vast Bitcoins gain currency in India
that has accepted the with-
drawal.
That leaves 25 applicants,
its banks need to park with the
central bank on which they do
not earn any interest, and SLR
shifts in global B Y S UNIL B .S . &
economy
attention than carbon dioxide does, but it too rich world must move, there’s no justification
including the Aditya Birla refers to a bank’s compulsory L ESLIE D ’M ONTE TOP FIVE COUNTRIES FOR
Group, the Bajaj Group and bond holding. Currently, ························· BITCOIN DOWNLOADS
MUMBAI
Anil Ambani’s Reliance Group, banks need to maintain a CRR B Y D AN S TRUMPF,

sense of proportion.
in the race for a banking li-
cence.
Tata Sons added in its state-
of 4% of deposits, while SLR is
23%.
New banks will also have to
C HRIS D IETERICH &
A LEXANDRA S CAGGS
The Wall Street Journal
U S-based Buttercoin, a free
Bitcoin exchange backed
by investors such as Google
US 1,207,661

ment that said it had written to
RBI on Tuesday withdrawing
the application after a detailed
comply with the so-called pri-
ority sector lending under
which 40% of the money
························· Ventures, says it is in talks with China 505,904
T he Nasdaq Composite Index
closed above 4,000 for the
Indian banks to launch an ex-
change in India to allow for the Germany 270,043

adds to the crisis of an atmospheric heat-trap for such diet advice aimed at Indians. What’s
evaluation of the “guidelines
for licensing of new banks in
the private sector” and analy-
sis of clarifications.
Tata Sons is not the first
business house to have a
change of heart. In June, Mahi-
ndra and Mahindra Financial
loaned by banks has to go to
certain segments such as agri-
culture, small businesses, re-
tail traders, professionals and
self-employed individuals.
This is difficult to achieve for
an NBFC with a large balance
sheet.
first time in 13 years, the latest
milestone in a 2013 stock rally
fuelled by easy money from the
US Federal Reserve (Fed) and ro-
bust investor demand for a
broader swath of fast-expanding
companies.
A rise of 23.18 points Tuesday
purchase and sale of Bit-
coins—a virtual currency that UK 236,523
has caught the world’s fancy.
“Most users of Bitcoins in Russia
India are people who are em- 226,680
ployed with the IT (informa-
Source: SourceForge
tion technology) sector. One of
GRAPHIC BY NAVEEN KUMAR SAINI/MINT; PHOTOGRAPH BY ANDY CLARK/REUTERS
the beneficiaries of the prolif-

(fluorinated gases and nitrous oxide are even crucial, globally, as the FAO campaign rolls out,
Services Ltd decided not to ap-
ply for a banking licence, say-
ing RBI’s norms were not con-
ducive for large and successful
non-banking financial compa-
nies (NBFCs) to turn into
banks.
According to the licensing
norms, the new bank will have
to be listed within three years
and the promoters’ sharehold-
ing must come down to 40%.
Within 10 years, this holding
must be further pared to 20%,
to 4,017.75 put the index up 33%
for the year. It remains more
than 1,000 points below its
record close of 5,048.62 on 10
March 2000. On Wednesday, the
Nasdaq was trading 16.85 points
higher at 10.30pm India time.
eration of Bitcoins is remit- in 2013. In October alone, ing the developments, said Al-
tances which NRIs (non-resi- there were 2,067 downloads of pana Killawala, principal chief
dent Indians) send back to Bitcoin, moving India’s rank- general manager, RBI.
their dependents in India,” ing one place up to 16. Bitcoin is an open source
Sunny Ray, director of busi- Globally, Bitcoins have been peer-to-peer electronic cash
ness development at Butter- downloaded 4,256,207 times system developed by Satoshi
coin, said. from 199 countries till date. Nakamoto, the pseudonym for

DAV I D AT TE N B OROU G H
Chennai-based Shriram and by the 12th year 15%. This Both the S&P 500 stock index He did not disclose any bank The US tops the ranking with an unknown person or group
Capital Ltd has also decided to is also a deterrent, many ana- and the Dow Jones Industrial Av- names. 1,207,661 downloads, followed of people who designed and

less known as culprits). Methane is a relatively is that nobody’s diet preferences are trampled.
withdraw its applications,
Businessworld reported on 30
August. However, there has
been no official confirmation
on this either from the compa-
ny or RBI.
In September, Value Indus-
tries Ltd, a unit of Videocon In-
dustries Ltd, withdrew its ap-
lysts said, as the promoters will
not be able to reap the benefit
of the value they create.
This apart, RBI’s inclination
to offer a banking licence on
tap may prompt some of the
companies to opt out of the
banking race for now as they
can always apply later, experts
erage have surpassed records
with regularity this year. The
Dow has set 43 all-time closing
highs in 2013. The last Nasdaq
close above 4,000 came at the
end of the dot-com boom, on 7
September 2000. The S&P 500
has climbed 26% this year, while
the Dow has gained 23%.
Bitcoins are fast gaining fa-
vour in India. According to
SourceForge, an online plat-
form that connects consumers
to open-source projects such
as Bitcoin and facilitates
downloads, there have been
35,648 downloads in India
since the launch of Bitcoins on
by China and Germany.
No one owns the open-
source peer-to-peer payment
network called Bitcoin, but it is
gaining in popularity and legit-
imacy. In fact, Bangalore will
host India’s first two-day con-
ference on 14 December to dis-
cuss the virtual currency in-
created the original software.
It is similar to a mobile app or
computer programme that
provides a personal Bitcoin
wallet and allows a user to
send and receive Bitcoins with
them.
According to the Bitcoin
website, a public ledger called

short-lived gas with an atmospheric lifetime of There should be no reproach, let alone stigma,
plication for a bank licence,
but the number of applicants
Mint is also available for R7 with
Hindustan Times in Delhi-NCR only
said. Until this round, new
bank licensing has been once-
in-a-decade affair.
TURN TO PAGE 7®
The Nasdaq’s climb under-
scores the vast shifts in the global
economy and the financial mar-
TURN TO PAGE 5®
9 November 2008. Experts esti-
mate there are two-three users
for every download.
Of these, close to 70%, or
24,723 downloads, took place
dustry and its future potential
since Bitcoins are not yet regu-
lated by India’s central bank.
The Reserve Bank of India
(RBI), though, is closely watch-
the “block chain” contains
every transaction ever proc-
essed, allowing a user’s com-
TURN TO PAGE 4®

around a decade, whereas carbon dioxide directed at those who consume red meat.

THEIR VIEW

Our topsy-turvy money market needs a remedial plan

standing facility (MSF) window, through
MADAN SABNAVIS which money is provided on an overnight
basis at a fixed rate of 6.75%. It reflects the
liquidity strain. On the other hand, there are
surpluses with some larger banks that are
parked in the standing deposit facility (SDF)
row from the call market before accessing The problem with this option is that the them in V3R auctions, rather than the call
the MSF facility. And then, after using up rate corridor, which should be between the market, as the V3R return would be higher.
their MSF limits, they may need to return to SDF and MSF, will lose some efficacy at the This can be part of RBI’s flexible monetary
the call market. Hence, at times of high upper end once V3R auctions get priced at policy targeting.
money demand, the weighted average call 6.74%, say, instead of 6.49%. In fact, RBI can also decide on whether
rate can go beyond the MSF’s 6.75%. To address this issue, a third factor could there should be a limit on the funds that can

T
he money market in India has wit-
nessed unusual scenes in the last few
months. There has been pressure on
liquidity ever since the Reserve Bank of
India (RBI) introduced an incremental cash
reserve ratio (ICRR). About ₹1.1 trillion with-
drawn through it turned the market around.
From a state of surplus liquidity, the system
at a 6.25% return.
Then there are periodic variable rate
reverse repo (V3R) auctions held by RBI in
which the scheduled amount normally is
₹50,000 crore for, say, 14 days, but only a
fraction of it is subscribed by banks. Banks
are not too forthcoming with their invest-
ments at this window. The reason is that they
There are three things to be looked at be looked at, which is the duration of the be accessed through that window, which
here. The first is the con- V3R window. Presently, was done in the past. A level of 1 or 2% of net
stant fear of banks with variable reverse repo rate demand and time liabilities (NDTL) can be
surplus liquidity of run- Varying liquidity auctions are for 14 days. considered for individual banks. Alterna-
ning into a deficit, as credit Shortening their tenure tively, there can be daily variable repo rate
conditions are uncertain. at banks has and setting a rate that is (V2R) auctions priced between the repo and
Therefore, some banks are between the repo and MSF MSF rates to ensure greater control on the
simply unwilling to lock
played a role in could work well. In fact, by call market.

is chief economist at Bank of

Baroda and author of
‘Corporate Quirks: The Darker
Side of the Sun’
now tends to be in a state of deficit on several
days, exhibiting some curious tendencies.
To begin with, there has been a deficit
caused by variance in the growth of bank
deposits and credit. The latter has outpaced
the former. As of 3 November, incremental
deposits were ₹15.36 trillion (excluding the
HDFC Bank merger), while growth in credit
was ₹13.06 trillion and in investments, ₹5.9
trillion. Hence, a direct deficit of around ₹3.6
trillion is visible.
However, the quirky part of the market is
that the liquidity status of banks differs.
There are some with surplus liquidity, while
others are in perennial deficit. This is evi-
denced by frequent use of RBI’s marginal
do not want to lock-in their funds for a long
tenure and prefer to use the SDF window,
even though the return there is 6.25%, as
against V3R’s 6.49%. Disparate levels of
liquidity give cash-surplus banks a chance to
earn a better return in the call market.
But this anomalous market situation of
differentiated liquidity also means that there
will always be banks that need funds on a
daily basis. RBI’s MSF funds come at 6.75%
and there are limits to which this window
can be accessed. It is the call money market
that first gets into action, where banks with
surplus funds lend to those who need them.
So long as the rate is up to 6.74%, or just
under the MSF rate, banks in deficit will bor-
funds in the 14-day V3R
window. Hence, they
anomalies that doing so, a short-term yield
curve could evolve for the
We need a different approach to address
today’s anomalous situation. A lot of what
invest in these auctions
only partly, and prefer to
could be fixed market.
Addressing issues in
has been suggested has been done in the past
and is not really novel. The V2R has also
either get a daily 6.25% by a shift in India’s money market has been reiterated by RBI in its last few policies,
return from the SDF or a become especially complex but not really been implemented. This has
higher-than-repo rate in RBI’s approach because banks tend to have pushed up the call money rate. The problem
the call market. varying levels of surpluses with a high call rate is that it also influences
The second issue is and deficits. Targeting the short-term bond yields, which tend to be
whether the return on the V3R window weighted average call rate makes sense, but elevated, reflecting the deficit in liquidity.
should be higher, if this is the clinching fac- the rate gravitates to the MSF in such situa- Given that the 10-year yield has moved
tor. This is important because RBI can have tions. To counter this, a way could be to have down, ideally short-term yields should fol-
a cut-off that is closer to the MSF rate rather daily repo auctions at 6.5%. Restoring the low suit. But they remain elevated due to the
than the repo rate, to make this window daily repo can be done in these unusual situ- weighted average call rate. The corridor is
attractive for banks. A higher return can ations. This way, the call rate will come down narrowing when it should be widening.
channel surpluses to the V3R window. and banks with surpluses would deploy These are the author’s personal views.
LIVEMINT.COM VIEWS TueSDay, 28 November 2023
New Delhi 13

THEIR VIEW M I N T C U R AT O R

Political economy of federalism: Scientists should admit their

covid errors for their own cred
Contain ‘transfer union’ discord American trust in them has dropped but they could earn it back

Perceptions have grown in the Eurozone and India that transfers from richer states are funding profligacy in poorer ones

MINT

FAyE d. FLAM
is a Bloomberg Opinion columnist covering
science.

ALOk ShEEL
is a retired Indian Administrative Service officer
and former secretary, Prime Minister’s
Economic Advisory Council.

D
uring the covid years, Americans’
trust in scientists fell, according to a
Pew poll. In 2019, only 13% of Amer-

A
lthough all federal states have some
mechanisms for the transfer of
resources from richer to poorer
constituents, if the perception grows
that the richer states are subsidizing
profligacy or incentivising populist
policies in the poorer states, the union could be
politically destabilized. Such perceptions are gain-
ing currency both in the Eurozone and in India.
In the Eurozone, there is rancour between the
poorer southern states and the richer northern
ones. The phrase ‘Transfer Union’ is often used to
describe transfers of resources from the latter to
the former. Although the Union of India is struc-
turally a very different kind of federation than the
Eurozone, there is nevertheless a similar percep-
tion in the southern and western states that reve-
nues generated from their taxpayers are being
transferred to northern and eastern states. They
have therefore been compelled to borrow more
than what is necessary for their own development.
What does Indian data show?: The table along-
side aggregates data for direct (personal and corpo-
rate) and indirect (goods and services) tax collec-
tions, their share in the common tax pool and
the public debt of 21 major Indian states and Union
territories. Since the states vary in size, they have
been brought on the same level by showing the
numbers on a per-capita basis.
The averages of states aggregated into the north-
ern and eastern region (Uttar Pradesh, Rajasthan,
Madhya Pradesh, Chhattisgarh, Bihar, Orissa,
Jharkhand, West Bengal, Assam) on one hand, and
the southern and western region (Maharashtra,
Gujarat, Karnataka, Goa, Andhra Pradesh, Telan-
gana, Tamil Nadu, Kerala and HDPC) on the other,
are shown in the table. ‘HDPC’ is an acronym for
Haryana, Delhi, Punjab and Chandigarh that com-
prise a high-income enclave in the otherwise
poorer northern and eastern region.
The table shows, first, that the taxes raised by
India’s northern and eastern states are equal to the
taxes transferred to them. The southern and west-
ern states, however, raise four times the amount in
taxes than what is transferred to them.
Second, the table shows that on average, there is
no significant difference between the two sets of
states in the debt burden as a share of gross state
domestic product (GSDP). However, the per capita
debt burden in the southern and western states is
much higher, as their borrowing capacity is higher
on account of higher per capita incomes and tax-
paying ability.
Third, unlike the European Monetary Union,
the Indian version of the ‘Transfer Union’ does not
entail transfers from richer southern states and
western states to the poorer north and east, but
from the two surplus regions to the central govern-
ment in Delhi that collects most of these taxes.
Uneven burden
Per capita tax collections of India’s richer southern
and western states are far higher than those of
northern and eastern states; their debt burdens are
heavier too.
Per capita tax collections, transfers and debt
Tax Tax A-B: Net
States collection transfers contribution
Average
North and 6,550 6,538 12
East (9)
Average
South and 24,510 5,900 18,610
West (12)
Note: All figures in ₹ except debt/GSDP ratio (in %)
Sources: Income Tax department, Parliament papers, RBI
Fourth, in the European Monetary Union, it is
the poorer states that are more highly indebted,
which is what one would expect. In India, however,
there is no appreciable difference in the indebted-
ness of the two sets of states. What lies behind this
counter-intuitive difference is the nature of budget
constraints in the two federations. Protocol No. 12
annexed to the Maastricht Treaty of the EU
imposes an upper limit of 3% of GDP for budget
deficits and 60% of GDP for gross public debt.
There is, however, no effective mechanism to
enforce these limits, even though the Delors Com-
mission that formed the basis of the European
Monetary Union had recommended ‘binding’ con-
straints on budget deficits among its constituents.
In the Indian Union, the kind of ‘binding’ or
hard budget constraint envisaged by the Delors
Commission is mandated in Article 293 (3) of the
Indian Constitution. This ensures that the debt of
constituent states of the Indian Union is kept in
check by New Delhi, as states in India need the
Centre’s permission to borrow. Since this con-
straint is strictly imposed through restraints on
both budget deficits and tax/GSDP ratios (also
envisaged but not enforced in the EU), there is on
average no appreciable difference in the tax/
C: Public debt
Per Debt/
GSDP ratios of the richer and poorer states.
capita GSDP However, on a per-capita basis, India’s richer
states are more indebted because their per-capita
22,662 27
incomes are higher. Since there are large net tax
transfers from the southern and western states, it
can plausibly be argued that they are effectively
38,094 24
borrowing money to facilitate such transfers.
Of course, the Eurozone and the Union of India
are structurally very different. The former is essen-
tially only a monetary union, though greater fiscal
union was originally envisaged. India is both a
monetary and fiscal union. The former comprises
independent nation-states that have sovereign
authority, whereas sovereignty resides with New
Delhi in the latter. There are, however, transfers
from richer states in both cases that can create
domestic geopolitical instability.
The debate over this asymmetric contribution
can get geopolitically messy if the political dis-
pensations in the Centre and states are at logger-
heads and there is a feeling that the rights guaran-
teed to them under the Constitution are being
undermined either in letter or in spirit, or the per-
ception gains ground that they are being made to
foot the bill for profligacy and poor policies in
other states. Measures need to be taken to assuage
growing resentment. The two unions can also
perhaps learn from each other’s experience in
adjusting their extant fiscal rules—too soft a
budget constraint in one case and too hard in the
other—to arrive at an optimal policy mix.
icans were distrustful enough to say they
weren’t confident in scientists to act in the
public’s best interest. Now that figure is
27%—despite recent triumphs in astron-
omy, cancer research, genetics and more.
It’s reasonable to assume the problem
stems from covid-era public health mis-
steps. Some public health agencies took
years to admit what had become obvious:
that the virus was airborne. Others sug-
gested precautions like closing play-
grounds and beaches whose benefit would
have been minimal. Some promoted poli-
cies like sustained social isolation that were
hard to implement and endure.
Public health researchers and officials
seem to think that rebuilding trust is just a
matter of clearer, more persuasive com-
munication. That would help, but it’s not
enough—they should admit their mistakes.
There has been reluctance. Last week, I
attended an international meeting at Bos-
ton University on pandemic preparedness,
and a panel on communication never got
into covid mistakes. When I asked experts
afterwards about policies and declarations
that look wrong in retrospect, I got a chorus
of “We didn’t know”—an unsatisfying
answer. Even at the time, scientists should
have been clearer when they were basing
policies on educated guesses.
Sandro Galea, dean of public health at
Boston University, delves into what public
health got wrong in his new book, Within
Reason: A Liberal Public Health For an Illib-
eral Time, to be published soon. He tackles
the silencing of dissent which led to group-
think and the encroachment of political
and personal opinions into science. That
led to policies that were not always within
reason—restrictions on outdoor behav-
iour, closed playgrounds and prolonged
school closings.
In an interview, Galea told me that the
reluctance to talk about such mistakes
comes from insecurity—a fear of giving in
to the other side, equated here with former
US President Donald Trump. Public health
officials were rightfully dismayed by
Trump’s unreliable bombast. But the
answer isn’t to pretend to be infallible.
Even as early as January and February
2020, the US public health community was
making unforced errors. Evidence
mounted week after week that this disease
was wreaking havoc in China and was
spreading around the world. Health
authorities should have been scrambling to
prepare hospitals and nursing homes, to
Scientists must show their dedication to
the pursuit of truth BLOOMBERG
create tests that worked, and to develop a
strategy for contact tracing and virus moni-
toring. They should have warned people of
possible closures ahead.
Instead, the US got reassurance from
public health officials, including editorials
claiming that seasonal flu was a worse
threat. New York’s major outbreak in
March 2020 created the conditions for a
U-turn. As people died despite the lock-
downs, we got moralizing about the dan-
gers of going outside, despite reasonable
evidence that was not the problem.
Perhaps it’s misguided to expect people
to trust scientists when trust in so many
institutions has fallen. (Scientists are still
more trusted than journalists, by the way.)
And yet science works because scientific
methods were developed to smooth out the
work of fallible humans into a body of relia-
ble and useful knowledge.
The double-blind clinical trial is an
ingenious antidote to bias and our human
tendency to see what we want rather than
what’s really there. That’s why I got the
covid vaccine—not because I uncritically
trust Anthony Fauci. The same level of evi-
dence didn’t support the implementation
of vaccine mandates, and some institutions
went beyond reasonable evidence in forc-
ing workers and students at very low risk of
severe disease to get second and third
booster shots.
This public health excess fed into exist-
ing pockets of irrational paranoia, giving
new power to gurus on YouTube who pro-
claimed that the government was covering
up deadly vaccine side effects as well as the
‘real’ cure for covid, apart from UFO aliens
and plots to take away everyone’s property.
Some of those spouting conspiracy theo-
ries were scientists (or at least people with
the right degrees), which pointed to a flaw
in the idea that people should trust the
whole profession. Historian Edward Ten-
ner calls them “alt-thorities” and they show
up not just on YouTube, but Fox News and
the popular Joe Rogan show.
So maybe the best we can hope for is
more trust in scientists who appeal to that
great body of established knowledge, and
who present new knowledge when bol-
stered with multiple lines of evidence. And
we should trust them not necessarily to act
in the public interest, but to act in the pur-
suit of truth. ©BLOOMBERG

MY VIEW | IT MATTErS

Altman’s return to OpenAI as its CEO: Humanity’s loss?

sounds remarkably like a human, but what
SIDDHARTH PAI is more striking is that the bot has access to
virtually the entire information storehouse
that is the internet. This development has
come to be known as ‘Generative AI.’
However, Generative AI is extraordinarily
profit arm. Limits were placed on the com-
pany’s commercial pickings, however. The
profit delivered to investors was to be
capped—for the first backers at 100 times
what they put in—with overflows to go back
to the non-profit part. This drew Microsoft
impact the entire sector. There was nothing
stopping Google in its bid for AI hegemony
(and neither indeed Microsoft, which has an
army developing its own AI products based
on OpenAI advances, among others). The
point is that now nothing can stop OpenAI
power of digital machines, which will also
create difficult social problems such as ineq-
uity in access to technology, the perverse use
of technology to spread fake news and the
ability of technology to influence traditional
democracies.”

M
eet the old new boss. Same as the old
boss.” These are the ending lines of
a song by The Who, written by Pete
Townshend, titled We Won’t Get Fooled
Again. The song is in many ways emblematic
of what we have seen at OpenAI over the last
few days. The back-and-forth will go down in
legend. But what we have really seen is prob-
inefficient. Poring through 175 zettabytes of as a huge backer, which pumped billions of
data, the entire web in 2022, is a Herculean dollars into OpenAI to feed
task. And this store is growing at warp speed. its zettabyte appetite.
A zettabyte is equal to 1,000 exabytes, and an The overall structure The last barrier
exabyte is 1 trillion gigabytes. To put one zet- was governed by the origi-
tabyte in perspective, consider this: It would nal non-profit board, to a commercial
take 2,535 years to stream one zettabyte to which answered only to
your device, even if the device had access to the goals of OpenAI’s origi-
takeover of AI
from participating in this free-for-all either,
despite Altman’s agree-
ment to submit to an inter-
nal review of his behaviour
as CEO of OpenAI.
These developments
aren’t good for us. The last
barrier to AI’s unbridled
Chandru also talks about the rate of
change in biotechnology and cites Flatley’s
law, a biotechnology counterpart to Moore’s
law. Named after Illumina CEO Jay Flatley,
this law posits that the cost of sequencing
DNA has dropped 1,000 times more than
Moore’s Law, from $100 million per human
genome to only $1,000. (acesse.dev/UuT8B).

is co-founder of Siana Capital, a

venture fund manager.
ably the death of any form of artificial intelli-
gence (AI) as a force for good. Let me explain:
OpenAI was first a non-profit research lab
whose mission was to safely develop AI that
was at a human level or beyond, often called
artificial general intelligence or AGI (with
‘singularity’ defined as the point at which AI
goes beyond human intelligence). The
emphasis was on safety to avoid what Yuval
Noah Hariri once warned of in the Financial
Times: “Once big data knows me better than
I know myself, authority will shift from
humans to algorithms.” (on.ft.com/49WXB1a)
OpenAI found a very productive route in
large language models (LLMs) that generate
surprisingly good text via a chatbot that
some of the fastest commercial networks
available today, which are at about 100Gbps
(Gigabits per second). (bit.ly/3STQdO8)
It should go without saying that develop-
ing and implementing those large models
requires enormous amounts of computing
infrastructure, and as a result, a massive
hoard of money.
This was a conundrum for OpenAI. How
does a non-profit lure enough investment
for such a massive enterprise? The powers
that be dreamt up a scheme that they may
have thought was a perfect answer: Create a
commercial entity to draw external inves-
tors with “capped profits.” Almost everyone
in the company worked for this new for-
nal mission, and had the
power to fire Altman. Also,
advances has
only a minority of directors
could hold shares in the
fallen even as
for-profit entity, and the biotech rushes
for-profit company’s
founding documents brashly ahead
required it to prioritize
public benefits over prof-
its. But all this is moot now. The truth is that
Altman was not in fact replaceable by the
board, as we have seen.
Now that the old boss is back, most of the
old board gone and directors who will prob-
ably be more pliant have taken over, OpenAI
is in a free-for-all situation, which could
commercialization has
fallen. Vijay Chandru of the
Indian Institute of Science
and the founder of Strand
Genomics, in a guest edito-
rial in the December 2020
issue of Current Science, a
well-respected scientific
journal published by the
Indian Academy of Sciences, identified the
fact that humanity faces a stark reckoning
with the pace of technological and scientific
innovation, and that we need to get our act
together. (bit.ly/3uvSCEy). Chandru says,
“The second machine age also warns us of
the anthropological impact of the unbridled
Chandru says “The next wave of the genom-
ics revolution comes from our ability to
write on genomes, i.e. to edit, or more accu-
rately proofread, and modify them. This
could have enormous impact, because
potentially we will be able to do this for
humans, plant genomes, animals, and
microbes.”
We should be concerned by the unbridled
growth of biotechnology. AI is in the public
eye and being closely watched by govern-
ments, even if only to appropriate AI advan-
ces for their own causes. We know less about
the impact that biotechnology could have,
and risk ignoring an Armageddon larger
than any that AI could bring on.
 7th
edition

HEALTHCARE
SUMMIT 2023
29 th November | New Delhi

Bridging the Healthcare Divide: Towards S

Sustainable Solutions
l
The 7th Mint Healthcare Summit will bring together policymakers, healthcare leaders, pharma bigwigs, industry captains, start-ups, leading
doctors, scientists, medical experts, and health ecosystem stakeholders from across the country. Register for the event and watch it live to learn
about the possibilities in this rapidly changing industry.

AGENDA

AYUSH: India's gift to The next pandemic. High tech with scale: Super speciality hospitals:
the world Are we ready? The future of healthcare Challenges and the way
forward

Shri Sarbananda Sonowal Dr. Kaushal K Verma Vishal Bali Dr. Upasana Arora
Hon'ble Minister of AYUSH, Ports, Dean (Research), Executive Chairman, CEO and Managing Director, Yashoda
Shipping and Waterways AIIMS AH Holdings Super Speciality Hospital, Kaushambi

Insuring the uninsured: Health insurance's Healthtech's cost-cutting and

penetration challenge scaling-up imperatives

Mayank Gupta Dr. Bhabatosh Mishra Ashish Venkataramani Shashank ND

COO & Co-Founder, Director- Product, Underwriting & Partner, Eight Roads Co-Founder and CEO,
Zopper Claims, Niva Bupa Health Insurance Ventures Practo

Shilpa Arora Rishi Mathur Prashant Tandon Gautam Chopra

Co-Founder & COO, Chief Distribution Officer - Alternate Founder & CEO, Co-Founder and CEO,
Insurance Samadhan Channels and Chief Strategy Officer, Tata 1mg BeatO
Canara HSBC Life Insurance

Indian Healthcare: Challenges and opportunities of the future

Dr. Mahipal S Sachdev Vivek Srivastava Dr. Om Prakash Aryaman Tandon Prof. Tanuja
Chairman and Managing Co-Founder & CEO, Manchanda Managing Partner and Manoj Nesari
Director, Centre For Sight HCAH India Managing Director, Co-Founder, Praxis Global Director, All India
Dr Lal PathLabs Alliance Institute of Ayurveda

Associate Scan the QR

#MintHealthcareSummit
Partners code to register