Friday, 30 December 2016

50 days of demonetisation: Cash no longer king, India will save more

As I write, demonetisation is already 50 days old. The past few weeks have seen waves of support, dissent and desperation hit India successively. Repeated changes in rules and clarifications from the finance ministry and the Reserve Bank of India (RBI) added to the chaos.

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Yes, the pain has not ended. Even as the government hoped to remonetise the currency withdrawn in 50 days, bankers believe that the shortage of cash (and the curbs on withdrawals) will persist for a longer period, with certain studies estimating that it will be at least 6-7 months before the situation normalises. Besides, government officials also hinted that the Centre might only opt for remonetisation according to requirements; it may not print fresh currency worth Rs 15.44 lakh crore that was withdrawn from the economy since November 8.

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Demonetisation: Cash crunch making some in Modi's party anxious

Cash shortages weeks after Prime Minister Narendra Modi's decision to abolish large currency notes are making allies and members of his ruling party anxious, with some distancing themselves from the move ahead of a series of state elections.

Modi removed 500 and 1,000 rupee notes, worth around $7.50 and $15 respectively, on Nov 8, billing it as an attempt to root out corruption, end terror financing and move the country into the age of digital payments.

Management News India:

He promised to replace all old bills with enough new currency notes by the end of this month. But his government has struggled to do that, leading to long lines at banks and a slump in economy activity. Nearly 90 percent of transactions in India used to be in cash.

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Wednesday, 28 December 2016

Modi govt to launch Swachh Swasth Sarvatra initiative today

Swachh Swasth Sarvatra initiative, aimed at strengthening health centres in opendefecation-free blocks, will be launched on Thursday by the Union Health Ministry in collaboration with the Ministry of Drinking Water and Sanitation and Human Resource Development.

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The objective is to strengthen community health centres in 708 open defecation-free blocks across the country to enable them to achieve higher levels of cleanliness and hygiene.

Under it, 10 lakh rupees of financial assistance will be given to the community health centres so that they can be strengthened to meet the standards of sanitation, hygiene and infection control.

Hyderabad bizman uses fake receipts to deposit Rs 98 cr in banks, arrested

A city-based businessman was arrested on Wednesday for allegedly cheating and generating 'fake and fictitious' advance payment receipts to deposit "black money" to the tune of Rs 98 crore in banks following the demonetisation of Rs 500 and Rs 1,000 tenders last month.

Besides Kailash Chand Gupta (65), his kin and others have also been booked by the police under various sections of the IPC for their alleged role in the "conspiracy".

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Central Crime Station, a wing of Hyderabad Police, arrested Gupta for his alleged involvement in cheating and manipulation of records for illegal gain post demonetisation.

Another businessman, Naredi Narender Kumar (59), MD of a private firm and brother-in-law of Gupta, was also arrested for abetment and hiding Gupta from the police.

A logo of Alibaba Group is pictured at its headquarters in Hangzhou, Zhejiang province, China. Photo: Reuters

Alibaba, largest e-commerce entity in China, is setting up its first India office in Mumbai, apparently an indication that it would step up investment in the country in the coming year, to capture a pie of the growing e-commerce market here.

So far, the Jack Ma-founded enterprise has been a preferred platform for small businesses in India to source industrial goods from China. And, for vendors selling their products to customers globally. Alibaba has invested in Indian e-commerce company Snapdeal, and in Paytm, the mobile payments service platform, through Ant Financials, its payment arm.

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It has, though, kept its plan to enter e-commerce in India under wraps. By setting up a office at Platina in the Bandra-Kurla Complex (BKC) in Mumbai, closer to that of US rival Amazon,it appears to now be signalling the intent that it is serious on entering.

“Given the kind of merchant network they have, India is definitely a potential market for them,” says Devangshu Dutta, chief executive of Third Eyesight, a consultancy for e-commerce firms. “There needs to be significant investment from Alibaba because Amazon is on a high and though Flipkart and Snapdeal are on a low, they’ve invested significant money in the delivery network.”

According to a US-based arms control organisation, a draft proposal for accepting new members into the Nuclear Suppliers Group (NSG) paves way for India's entry but leaves out Pakistan.

Last week, the US media reported that former NSG chairman Rafael Mariano Grossi had prepared a two-page document, explaining how a non-NPT state, like India and Pakistan, could join the group.

Management News :

The document prepared by Grossi, acting on behalf of the current chairman Song Young-wan of South Korea, enjoys a semi-official status, reports the Dawn.

Grossi's draft note proposes that "one non-NPT member state should reach an understanding not to block consensus on membership for another non-NPT member state".

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Cabinet passes ordinance; fine, jail for holding old notes

The Cabinet on Wednesday approved an ordinance to impose penalties on anyone possessing the demonetised Rs 500 and Rs 1,000 notes.

The penalty for holding old currency in excess of 10 notes may include financial fines and a jail term of up to 4 years in certain cases.

INDIA BUSINESS NEWS :

The ordinance, named as 'The Specified Bank Notes Cessation of Liabilities Ordinance', is to extinguish liability of government and RBI on the demonetised high-denomination notes.

In a surprise announcement by Prime Minister Narendra Modi on November 8, Rs 500 and Rs 1000 notes were declared as illegal currency.

I-T notices to 50 car dealers; seeks details of customers post Nov 8

The Income-tax department has issued notices to over 50 car dealers, asking them to furnish details of customers who have bought cars after November 8, following the demonetisation of 500- and 1,000-rupee currency notes.

The notices are being sent under Section 133(6) of the Income Tax Act, 1961, which empowers the I-T authorities to seek information that could be useful in connection with any pending proceeding or enquiry.

Economy Policy :

Confirming the development, a senior income-tax official said that the department has observed a significant increase in car sales during the past two months. "This is part of an exercise in which we checking the use of junk old notes and also tax evasion through such buying," the official said.

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PokemonGo to Rio2016: The top five social media trends in 2016

The year 2016 is nearly over and, like previous years, this one also saw some good, some bad and some strange stuff on social media.

Company News :

It is not unusual for people to comment on the speed with which an entire year went by, that does not, however, mean that the year was not full of action. Here is a recap of some of the major topics that trended on social media this year to help refresh your memory:

Tuesday, 27 December 2016

Burden of proof on Mistry as battle lines form for Tata legal showdown

As India's biggest corporate showdown heads from the boardroom to the courtroom and brings in a Who's Who of the country's legal profession, ousted Tata Sons chairman Cyrus Mistry vows a multi-layered battle for governance reforms at the $100 billion conglomerate, people close to him say.

Companies Results :

Mistry, who was dismissed from his post in October and has since left boards at other Tata group companies, will step up his legal fight with patriarch Ratan Tata and others and make his case in any regulatory investigations into the Tata group, three people familiar with Mistry's strategy said.

Mistry has so far broadly laid out three sets of allegations: breaches of governance within the Tata group; misconduct at Tata ventures; and the illegality of his ouster.

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Monday, 26 December 2016

Fast-food chains cultivate untapped workforce

American fast-food chains have become an unlikely source of female employment and empowerment in India, a country where traditionally most women are kept
from working outside the home.

The increasingly female face of a new Indian workforce shines at suburban Delhi’s Mall of India. Close to half the employees in its five floors of newly opened food and fashion outlets are women. Just across the street in the old shopping district, females are few and far between. Even the women’s clothing stores are almost entirely manned by men.

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“I wouldn’t feel comfortable working with so many other men there,” said Poonam Rawat, a 21-year-old woman who works at Wendy’s in the mall. “Besides, my family would never give me permission.”

Despite great progress in recent decades, India is still a tough place to be a woman. The country has one of the most-skewed sex ratios in the world, with men significantly outnumbering women, the result of selective abortion and infanticide.

Demonetisation: Rs 50,000 as penalty for possessing old notes after Dec 30?

The government is mulling an ordinance to bring a new law under which possessing, transferring or receiving over Rs 10,000 in banned 500 and 1,000-rupee notes post December 30 will be a punishable offence.

Reports said that there could be a cap of holding no more than 10 notes of each after December 30 and violation of the rule could draw a fine of a minimum of Rs 50,000 or 5 times the amount in question -- whichever is higher, but there was no confirmation. There will be a criminal liability and a municipal magistrate will hear cases involving violation and decide on penalty.

Financial News :

Holders of such currency have an option to deposit them in RBI by March 31 but even that period may be curtailed, they said.O

Of the Rs 15.44 lakh crore worth of 500 and 1000 rupee notes in circulation on November 8, close to Rs 13 lakh crore have been deposited in accounts or exchanged for valid currency.

There was no official word on the move which is likely to come up before the Cabinet on Wednesday.

Jet Airways flight veers off runway in Goa, all passengers evacuated safely

Jet Airways flight 9W-2374 from Goa to Mumbai skidded off the runway at Goa's Dabolim airport on Tuesday with 15 passengers suffering “minor” injuries during the evacuation.

Financial News :

The flight veered off the runway due to a technical glitch. However, all 161 people on board were evacuated. Reports said the incident occurred at around 5 am Flight 9W 2374 which had arrived from Dubai and was bound for Mumbai, was about to take off when it skidded off the runway.

Eight passengers who suffered minor bruises have been taken to the hospital

In a first, govt to penalise individuals for polluting Ganga

The Narendra Modi Government is planning to penalise those found guilty of polluting the Ganga river, in a first of its kind bill which aims to ensure cleanliness and uninterrupted flow of the river.

The Ganga act is being prepared by a panel headed by Justice Girdhar Malviya, and once it is being finalised the bill will be taken up the Union Cabinet, Water Resources Minister Uma Bharti told reporters here.

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"I want to ensure ensure cleanliness (Nirmalta) and uninterrupted flow (avirlta) of Ganga from its origin till its submerge into sea. Therefore, there will be provisions to punish and penalise those founded guilty of polluting or checking the flow of this holy river," Bharti said.

The minister added that she has been requesting the committee to submit its report for the Ganga act at the earliest so that the law could be implemented.

Post demonetisation, digital payments are down 15%

Contrary to the government’s aims of increasing digital payments through notebandi, the number of cashless payments–through online, mobile banking, debit cards and immediate payment service (IMPS)–reduced by 15% in November 2016, when compared to October 2016, after rising since January 2016, when compared to the previous year.

In a year that will be remembered in history for notebandi–a colloquial term for the withdrawal of 86% of the value of India’s currency in circulation on November 8–the amount transacted digitally reduced by 8% in November 2016 over the previous month. Reduction in both the number of transactions and the value of money transferred, shows a reduction in general consumption immediately after notebandi.

Stock Market News :

Still, cashless payments in October 2016 increased 22%, when compared to October 2015.

Cashless payments decline in November 2016; pick up in December
Compared to October 2016, the number of all kinds of cashless transactions, except cheque payments, decreased in November 2016, the month when old Rs 1,000 and old Rs 500 notes were demonetised. Except for mobile banking, the money transferred using all means reduced in November 2016.

Sunday, 25 December 2016

McDonald's, Pizza Hut & KFC are empowering Indian women; here's how

American fast-food chains have become an unlikely source of female employment and empowerment in India, a country where traditionally most women are kept from working outside the home.

Latest News India :

The increasingly female face of a new Indian workforce shines at suburban Delhi’s Mall of India. Close to half of the employees in its five floors of newly opened food and fashion outlets are women. Just across the street in the old shopping district, females are few and far between. Even the women’s clothing stores are almost entirely manned by men.

“I wouldn’t feel comfortable working with so many other men there,” said Poonam Rawat, a 21-year-old woman who works at Wendy’s in the mall. “Besides, my family would never give me permission.”

Wadia files criminal suit against Tatas

Nusli Wadia, the former independent director on the board of Tata Steel and Tata Motors, on Friday filed a criminal defamation suit against Tata Sons Interim Chairman Ratan Tata, the company and its directors. Larsen & Toubro Chairman A M Naik, Godrej group director Tania Godrej-Dubash will be among others who would be witnesses to Wadia’s good character.

Econnomic news :

The suit has been filed, in the court of additional chief metropolitan magistrate, against a special notice to remove Wadia from the boards of the Tata firms for purportedly acting in concert with former Tata Sons chairman Cyrus Mistry and galvanising other directors against the Tatas.

It said all the accused, individually and collectively, have defamed Wadia by circulating false, baseless and libellous material about him with the sole intention of lowering his reputation. Wadia said the special notices were sent on the letterhead of Tata Sons and have been signed by F N Subedar, chief operating officer and company secretary of Tata Sons. All directors of Tata Sons have been made accused except Mistry and Farida Khambata.

Wadia voted out of Tata Chemicals; Bhaskar Bhat, S Padmanabhan to come in

Shareholders of Tata Chemicals have voted out Nusli Wadia as an independent director of the company with 75.67 per cent votes going in favour of a resolution moved by Tata Sons to remove him at the company's extraordinary general meeting (EGM) on Friday.

According to a regulatory filing by Tata Chemicals, out of the total of 25.48 crore shares of the company, 14.91 crore shares were voted. Out of this, 11.28 crore were in favour of the resolution to remove him.

Company Results :

The company said 3.62 crore votes, accounting for 24.33 per cent of votes polled, were against his removal.

Tata Chemicals also said the shareholders have approved a resolution to appoint Bhaskar Bhat as a director of the company with 79.26 per cent of votes going in his favour.

It further said the shareholders have also approved the appointment of S Padmanabhan as director of the company with 89.29 per cent voting in favour of a resolution for his appointment.

Strong law against benami property: Modi defends changes in note ban rules

Dismissing the criticism of frequent changes in rules after demonetisation, Prime Minister Narendra Modi on Sunday alleged that those who cannot endorse corruption and black money openly are relentlessly finding fault with his government. He vowed to take forward the fight against unaccounted money and corruption by implementing a strong law against benami properties.

Finance News :

“I assure you this is just the beginning in our fight against corruption. We have to win this war. There is no question of stopping... there is no question of retreat,” said Modi, under sharp attack from the Opposition over demonetisation, with Congress Vice-President Rahul Gandhi levelling allegations of “personal corruption” against him.

In his last monthly address this year in the Mann ki Baat programme, Modi defended the changes in the rules related to deposits and withdrawals, saying these have been done to reduce people’s problems and defeat the forces which are out to thwart his government’s fight against black money and corruption.

Thursday, 22 December 2016

How Modi govt lobbied Moody's for ratings upgrade, but failed

India criticised Moody's ratings methods and pushed aggressively for an upgrade, documents reviewed by Reuters show, but the US-based agency declined to budge citing concerns over the country's debt levels and fragile banks.

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Winning a better credit rating on India's sovereign debt would have been a much-needed endorsement of Prime Minister Narendra Modi's economic stewardship, helping to attract foreign investment and accelerate growth.

Since storming to power in 2014, Modi has unveiled measures to boost investment, cool inflation and narrow the fiscal and current account deficits, but his policies have not been rewarded with a ratings upgrade from any of the "big three" global ratings agencies, who say more is needed.

'Sniff test' may help reveal if you're at Alzheimer's risk

Soon, diagnosing early Alzheimer's disease may be as simple as measuring a person's sense of smell.

Breaking news:

A new study from the Perelman School of Medicine at the University of Pennsylvania confirms that administering a simple sniff test can enhance the accuracy of diagnosing this dreaded disease.

Neurologists have been eager to find new ways to identify people who are at high risk of Alzheimer's dementia but do not yet show any symptoms. There is a widespread consensus that Alzheimer's medications now under development may not work after dementia has set in.The sniff test also appears to be useful for diagnosing a pre-dementia condition called mild cognitive impairment (MCI), which often progresses to Alzheimer's dementia within a few years.

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Vitamin D improves gut flora, metabolic syndrome

vitamin+d+prevents+prostate+cancer+growth.png

Extra Vitamin D can restore good bacteria in the gut, according to a study on mice, giving hope in the fight against risk factors for diabetes and heart disease.

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Scientists have now discovered that Vitamin D deficiency is necessary for this syndrome to progress in mice, with underlying disturbances in gut bacteria.

The study, published in the journal Frontiers in Physiology, found that an insufficient supply of Vitamin D aggravates the imbalance in gut flora, contributing to full-scale fatty liver and metabolic syndrome.

IT hiring at 10-year low, Infosys takes campus hires as interns

India’s second largest software exporter Infosys Ltd is offering paid internship to campus hires before taking them on rolls, a move that that would impact new jobs across the IT sector when hiring by technology services companies is already at a ten-year low.

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The Indian technology services sector is facing its worst growth period in close to a decade as they see clients reducing budgets on traditional outsourcing work, which is not being offset by growth in newer areas such as digital and cloud. In addition, routine maintenance work of customer applications or IT infrastructure, where freshers are normally deployed have been taken over by automation or robots.

With use of automation, these companies are shifting their employees from projects, where their jobs have become redundant and training them on skills to match new requirements. Infosys and its cross town rival Wipro shifted more than 8000 employees from projects to other roles due to automation during the first half of this fiscal.

BJP calls Mamata 'maharani of corruption', rejects her charges

Calling West Bengal Chief Minister Mamata Banerjee 'maharani of corruption', The Bharatiya Janata Party (BJP) on Wednesday said police were doing their work and it was not a part of political vendetta.

"What Mamata is doing against Hindus in Bengal? The way they are being assaulted is a political vendetta. The police will do what they have to and it is not a part of political vendetta," said BJP leader Siddharth Nath Singh.

Singh further said Mamata is talking about raids in Delhi and Tamil Nadu, but she has forgotten that raids were also conducted on bureaucrats in Rajasthan, where it is BJP's government.

Taking a jibe at the Trinamool Congress (TMC) chief, Singh said that Mamata is called the 'maharani of corruption', but now she has to answer not only for the Saradha and Narada scams but also the Rs 10,000-crore Rose Valley scam.

"We are working within the frame of Constitution. There are checks and balances within the Constitution to keep a check on the functioning of government and whoever will violate it, will be pulled up," he said.

PM likens opposition to Pakistan; attacks Manmohan, Chidambaram, Rahul

In an aggressive speech, with oodles of sarcasm thrown in, more reminiscent of his election campaign speeches in the run up to the 2014 Lok Sabha elections, Prime Minister Narendra Modi today equated opponents of ‘note ban’ of trying to shield the corrupt, just as Pakistan starts firing on Indian border posts to distract Indian Army so that infiltrators can sneak into Jammu and Kashmir under its cover.

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The PM also attacked Congress leadership, particularly former PM Manmohan Singh and Congress Vice President Rahul Gandhi. Questioning the former PM's integrity, Modi expressed surprise that there was no blot on Singh even when he has been part of India's economic policy think tank since the early-1970s.

The PM was speaking at the foundation laying ceremony of Mahamana Pandit Madan Mohan Malaviya Cancer Centre in Varanasi, his Lok Sabha constituency. Modi said when he announced ‘note ban’ decision he didn't think it was possible that politicians and political parties would be so unashamed as to come out openly to defend the corrupt.

RBI slaps fine on 5 foreign banks for violating FEMA rules

The Reserve Bank on Wednesday imposed penalty on five foreign banks, including Deutsche Bank and Standard Chartered Bank, for violation of its instructions on reporting requirements of the FEMA.

The three other banks are: Bank of America, Bank of Tokyo Mitsubishi and The Royal Bank of Scotland.

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RBI said they have been fined for violation of its instructions on reporting requirements of the Foreign Exchange Management Act, 1999 (FEMA).

"The penalties have been imposed in exercise of the powers vested in the Reserve Bank under the provisions of Section 11(3) of FEMA 1999, taking into account, the violations of the instructions/directions/guidelines issued by the Reserve Bank of India, from time to time," RBI said.Germany's Deutsche Bank has been imposed fine of Rs 20,000, while Bank of America, Bank of Tokyo Mitsubishi, The Royal Bank of Scotland and Standard Chartered Bank have been fined Rs 10,000 each.

Full text of Nusli Wadia's letter to Tata Motors shareholders

Amid an ongoing battle between ousted Tata Sons chairman Cyrus Mistry and Ratan Tata, Nusli Wadia, an independent director on the board of Tata Motors, on Thursday wrote a letter to the shareholders of the company defending his role on the board and questioning the allegations levelled against him by Tata Sons.

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"... It is my duty to point out to you, the baseless and false allegations that have been made in the explanatory statement by Tata Sons supporting the resolution to seek my removal. I addressed each of the allegations that they claimed to be their reasons for my removal none of which were linked to my performance as Independent Director," he wrote.

Wadia again referred to Tata Nano as an ill-conceived investment that had been a drag on the company's finances. "I have outlined events relating to some key decisions of the Board. Most important of all is Taqata Motrors' ill-conceived investment in NANO, the car that neither sells nor is viable as every sale of the vehicle is at a substantial loss to the company."

Here is the full text of Nusli Wadia's letter to Tata Motors shareholders:

My Dear Shareholders,

I had sent you a few days ago, a detailed letter setting out my response to the resolution proposed by Tata Sons for my removal as a Director of your Company.

As I mentioned, I have served your Company as an 'Independent Director' for more than 18 years having been invited by JRD Tata, my mentor and Godfather.

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Wednesday, 21 December 2016

'Demonetisation may have cost banks Rs 3,000 cr per day'

On Wednesday, the Reserve Bank of India (RBI) withdrew its previous directive that required deposits above Rs 5,000 in old currency notes be justified to two bank officers. To understand the impact of this move, Business Standard spoke to the HARVINDER SINGH, general secretary of the All India Bank Officers Confederation.

The Reserve Bank of India (RBI) has withdrawn its previous directive that required deposits above Rs 5,000 in old currency notes to be explained to bank officers. What do you make of this?

A: We have been pleading before RBI and Ministry of Finance that instructions issued for general public must be always clear. What was happening was that instructions issued through electronic media or notifications were reaching banks much later than when the people at large were coming to know. There was time gap between the implementation of the instructions issued by the RBI/government because when the instructions reach banks, they would have to modify their systems so that the instructions are implemented.

For example, one instruction came that we will permit withdrawal of 2.5 lakhs per family where there are marriages. Lot of conditionality were put. But these instructions were made viral during the mid of the day but actually these instructions were received by banks two days after. For these 2-3 days bank officers were facing a lot of problem.

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Monday, 19 December 2016

Meet the BS Banker of the year 2015-16: HDFC Bank's Aditya Puri

Aditya Puri, managing director of HDFC Bank is the Business Standard Banker of the Year for 2015-16.

He was selected by a six-member jury headed by former Economic Affairs Secretary C M Vasudev, for the bank’s commendable contribution in the digital banking space as well as the lender’s deep reach in rural and semi-urban India. At the same time, the bank maintained its healthy profits over the years and also kept a leash on its asset quality.

The other jury members were former Reserve Bank of India (RBI) Deputy Governors Anand Sinha and H R Khan, Edelweiss Group Chairman Rashesh Shah, Ican Investment Advisors Chairman Anil Singhvi, and Ambit Capital CEO — Institutional Equities Saurabh Mukherjea.

In the first screening proposed by Business Standard, two filters were used: asset size of over Rs 50,000 crore and a growth in net profit in 2015-16. The result was a dominance of new private sector banks and small public sector banks.

The jury decided to modify the filters and went on to do a more rigorous analysis to rise above “cold statistics”. Statistics, the jury argued, could be made favourable by pursuing narrow banking.

Thereby, a need was felt to emphasise the risk taking ability of the bank and its leader at a time when a slowing Economy meant more bad asset accretion in proportion to the rate of expansion of the lending book.

“We are trying to select the best banker. Should we give the award to someone who is completely risk averse and decided to not contribute much towards industrial development and rural penetration? I think not,” Vasudev set the standard for the rest of the jury.