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mint
QUICK EDIT
primer
Imagery
Why young, not addiction
ageing, firms can Is human communication
going back to the age of hiero-
glyphs? The outrage online on

spur job creation Wednesday over an image-

BY DHIRENDRA TRIPATHI
Contrary to popular belief, the Economic Survey 2019 says “dwarfs”—
over 10-year-old firms with less than 100 employees—which account
for a majority of firms in organized manufacturing, hold back job
creation and productivity. Mint explains why it is so and the way out.
Small is not big on value
Small firms that employ under 100 employees account for about 85% of all firms
in India, but their contribution to output and employment remains marginal.
2010-11 2016-17
Distribution of number of
factories by firm size
Share in total no. of firms
71.9 72.3 (in %)
12.1 16
12
0-49 50-99 Above 99
Firm size (number of employees)
NVA: Net value added
How do small and
1 young firms fare in
terms of job creation?
The Economic Survey says the
contribution of small firms to
output and employment in the
manufacturing sector is
insignificant, though they make
up around 85% of all firms. But it
makes a crucial distinction: most
young firms are small, but most
small firms are not young, at least
in the Indian context. It says the
notion that small firms create jobs
has prevailed because young firms,
or “infants”, which also happen to
be small, generate employment,
besides adding value to the jobs
ecosystem. Small firms operating
for over a decade typically destroy
as many jobs as they create.
4 How do India’s policies
restrict employment? 5
The Survey blames restrictive
labour laws for discouraging more
employment. For example, the
Industrial Disputes Act, 1947,
mandates firms to get government
permission before laying off staff.
This applies only to firms with
more than 100 employees. Given
the transaction costs inherent in
complying with such norms, many
firms maintain their staff strength
under the threshold. Such labour
laws create perverse incentives for
firms to remain small. It leads
them to make products that carry a
certain protection and incentives.
loading crash suffered by Face-
book and its other apps, What-
sApp and Instagram, would
suggest so. Text messages had
no problem being exchanged.
Neither did those reductionist
little emojis. WhatsApp was
first littered with a hollow-eyed
emoji modelled on Edvard
Munch’s Scream, and then by
teary laughter after Facebook
took to Twitter, of all things, to
issue an apology. Image files
Distribution of NVA share by firm size simply refused to load.
Share in NVA (in %) By the time the glitch was
84 88.5 fixed, the internet had revealed
a global addiction to pictorial
15.7 expression. Few seemed able to
get by without the aid of some
8.6 6.9 7.4
imagery in one form or another.
4.6 Does this reflect a regression to
olden days? Or the need for a
0-49 50-99 Above 99 global digita franca? Human
Firm size (number of employees)
language evolved from the
Source: Economic Survey 2019
grunts and groans of survival,
PARAS JAIN/MINT
the kind that accompany joint
Are “dwarfs” peculiar
2 to India?
The Economic Survey categorizes
action taken against predators
or in favour of the species’ per-
petuation. Drawings came next.
small companies older than 10 Today, the stuff of pharaonic
years as “dwarfs”. It says such
glory has more or less taken
companies have continued to
witness stunted growth despite over our handsets. Scream in
surviving for over a decade. emojic horror, if you must, but
Though a company employing 100 don’t forget to squeeze out
workers is not large in the global those watery guffaws.
context, in India it is. The inability
of these small, but old, companies
to create jobs is peculiar to India.
An average 40-year old company
in the US generates five times as
much employment as its
MINT METRIC
counterpart in India, observes the by Bibek Debroy
Economic Survey. Even an average
40-year old company in Mexico
generates 40% more employment
A crazy swing with the bat
than its peer firm in India. Led to an avoidable spat.
Bail to brawl
3 How do they survive?
The Survey says “dwarfs” in the
US and Mexico employ more people
And free for all,
How does one handle that?
and are more productive than their
Indian peers. It explains that despite
that, the Indian government’s policies
protect “dwarfs” rather than “infants”. QUOTE OF THE DAY
I love gold...What’s the sense of
What is the solution?
The Survey calls for labour
reforms to address the problem of
holding euro when you get a
“dwarfs”. It cites the case of
negative rate? You might as well
Rajasthan, where flexible labour put it into gold, because gold is
laws led to higher productivity and
more employment. It calls for
a much better currency.
incentivizing “infant” firms rather
than small ones. The incentives
should be for a certain period, not
indefinitely. It also calls for using
the promoters’ Aadhaar ID so that
they can’t use the benefits after the
sunset period. The focus should be MARK MOBIUS
on high employment-elastic VETERAN INVESTOR
sectors such as rubber and plastic, AND FUND
electronics and tourism that have a MANAGER
large spillover effect.

STUMP VISION BY AYAZ MEMON

TEAM M W L NRR P
England’s win over New Zealand has left Pakistan AUSTRALIA 8 7 1 +1.000 14
clutching at virtually non-existent straws to reach INDIA 8 6 1 +0.811 13
the semis. While they could mathematically make the ENGLAND 9 6 3 +1.152 12
cut by beating Bangladesh, the NRR requirement NEW ZEALAND 9 5 3 +0.175 11
makes it almost impossible. That apart, Bangladesh PAKISTAN 8 4 3 -0.792 9
are no pushovers. If anything, their batting has SRI LANKA 8 3 3 -0.934 8
shown more resilience than Pakistan’s. It’s only BANGLADESH 8 3 4 -0.195 7
in terms of bowling that Pakistan can be con- SOUTH AFRICA 8 2 5 -0.080 5
sidered a nudge ahead—and only just. Irrespec- WEST INDIES 9 2 6 -0.225 5
tive of impact, it should be a keen contest with AFGHANISTAN 9 0 9 -1.322 0
both teams looking to score brownie points.
West Indies (311/6 in 50 overs) beat
Ayaz Memon is a senior sports columnist. Afghanistan (288 in 50 overs) by 23 runs
 mint
cricket preview

So near and yet so far for

Pakistan and Bangladesh
BY SUMIT CHAKRABERTY

While Pakistan’s chances of making it to the semis were virtually snuffed out by England’s victories over India and
New Zealand, Bangladesh’s hopes were dashed by India on Tuesday. When the two Asian teams play their last
game of the World Cup at Lord’s on Friday, they will rue the opportunities they missed to make it to the final.

VITAL STATS
PAKISTAN BANGLADESH
Ranking 6 7
Head-to-head World Cup wins 0 1
Head-to-head wins in the last 5 ODIs 6 4

1 Hopes dashed
Pakistan had rekindled their hopes of qualifying for the semi-
finals after beating New Zealand and Afghanistan. A win in their last
game against Bangladesh will take them to 11 points. England had lost to
Sri Lanka and Australia. Another defeat, to either India or New Zealand, would
have limited them to 10 points. But that wasn’t to be. New Zealand lost badly
to England, but Pakistan would be peeved that India appeared to give up the
chase too soon with five wickets in hand. Despite the big loss to England,
New Zealand’s huge wins over Sri Lanka and Afghanistan should keep
their net run rate out of reach even if they are tied on points with
Pakistan.

2 Pakistan have themselves to blame

Honest introspection will show that Pakistan have themselves to
blame more than other teams not helping them out. Their disastrous
start, when they got bowled out for 105 by the West Indies, destroyed
their net run rate. They were unlucky to have their game against Sri
Lanka which they would have expected to win—washed out, but were
lucky to eke out a win over Afghanistan by the narrowest of margins.
Pakistan recorded great wins over England and New Zealand, but took too
long to fix their team selection by dropping Shoaib Malik and Hasan Ali.

3 Bangladesh’s big miss

Bangladesh’s narrow loss to New Zealand hurt them the most.
They were playing the Kiwis at The Oval—a venue where they had
racked up 330 and beaten South Africa. This time, however, they
made only 244 after the untimely dismissal of Shakib Al Hasan, who
was caught behind off part-time bowler Colin de Grandhomme.
They did fight all the way, taking eight Kiwi wickets on a pitch that
was offering turn. But here’s where skipper Mashrafe Mortaza
missed a trick. He switched to medium pace instead of completing
the quota of spinner Mosaddek Hossain who had taken an
impressive 2 for 33 in 8 overs.

4 Mortaza on his last legs

The 35-year-old Mortaza has led the team well and deserves
credit for making Bangladesh serious contenders. But he’s clearly on
his last legs, hobbling on the field with his slow medium pace and
unable to contribute much with the bat. At this level, a team cannot
afford to carry a passenger, however much he contributes as a leader.
Perhaps a stronger bowler than Mortaza might have served Bangladesh
better in a couple of close games.

5 Shakib’s world record

Shakib Al Hasan has been the biggest sensation of this World Cup. In the
game against India, he became the first player in the history of the
tournament to cross 500 runs and take 10 wickets. He has always been a canny Mashrafe
left-arm spinner. Now, it’s his batting that has reached new heights after he Mortaza
moved up to the number three position. He appears to have taken a leaf out of AP

Virat Kohli’s book in maintaining a good run rate with risk-free shots and
pouncing on any opportunity to hit a boundary. He should be leading the
Bangladesh team.

Sumit Chakraberty is the author of 2019 Cricket World Cup Thinking Cap

ART BY NUMBERS
A weekly analysis of the Indian and global art market

Where M.F. Husain’s horses stood in the art race

The number of M.F. Husain works featuring horses

266 that have been sold in auctions since 2000. Though

Husain painted a wide range of subjects, the equine
animal was a quintessential signature of his,
appearing in a range of dimensions, and on a variety of materials.
These works have generated sales worth ₹222 crore. The first work
featuring this subject to be auctioned was White Horse that achieved
₹1.1 lakh in a Sotheby’s sale in 1992. Read in context to the highest price
ever achieved by the subject—a record established in March earlier
this year—wherein Christie’s sold a spectacular large-format canvas An untitled work by M.F. Husain featuring the
measuring 50 x 81 inches for ₹7.12 crore, and you would note the animal dating back to the early 1960s.
market movement of this subject. According to a recently released
Artery India report, between 2014 and 2018, the artist’s works sold in auction realized ₹327 crore, of which ₹76.3
crore was from the subject of horses. This is the single-highest tally for a subject for this artist, across all five years for
which reviews were conducted since 2000. There were a total of 68 works, 57 of which were canvases, claiming the
majority of the turnover at ₹71.6 crore. The highest achieved for a work, on paper, featuring this subject to be sold
during this 5-year review is ₹26.34 lakh for a larger-than-the-norm ink and watercolour, measuring 50 x 27 inches that
was sold by Saffonart in June 2018. This was just below the all-time high for this medium that stands at ₹28.95 lakh.
Compiled by Arvind Vijaymohan, CEO of Artery India—an art intelligence and sales advisory firm.

PEANUTS by Charles M. Schulz

 NEW DELHI, MUMBAI, BENGALURU, KOLKATA, CHENNAI, AHMEDABAD, HYDERABAD, CHANDIGARH*, PUNE* VOL. 13 NO. 160 Rs 5.00 IN DELHI-NCR; Rs 6.00 OUTSIDE DELHI-NCR. PRICE WITH HINDUSTAN TIMES Rs 9.50 (FOR DELHI & NCR) 22 PAGES

PLAIN
FACTS
INDIA LEADS IN BREAKING A NEW DEAL REQUIRED
FRIDAY, JULY 5, 2019
LIVEMINT.COM
DOWN BATSMEN’S DEFENCES uP2 FOR INDIA’S RURAL AREAS uP12

Eco Survey lays out blueprint for growth

Subramanian advocates private investment-led growth, calls for lower real interest rates and relaxed labour laws to help the economy expand at 8%
Asit Ranjan Mishra m MINT GRAPHITI
asit.m@livemint.com
NEW DELHI TOWARDS A $5 TRILLION ECONOMY Blue sky thinking, nudge theory,

T
he Economic Survey on The Economic Survey is marked by the fresh approach it advocates in policymaking.
Thursday prescribed a pri-
vate investment-led growth
THE CALCULATION
8% real growth + 4% inflation
= 12% nominal GDP growth
ECO Survey says
the govt should
THE fact that
most people
THE default
option should
RELIGIOUS
and spiritual
EXAMPLES of
nudging include
religious norms in CEA playbook
strategy to achieve Prime use insights into tend to stay be ‘opt-in’ to principles can campaigns on
Minister Narendra Modi’s THE EXCHANGE RATE Gireesh Chandra Prasad
behavioural with default expand the be used with educating the
vision of making India a $5 trillion 75 to the dollar gireesh.p@livemint.com
economics from choices because coverage of behavioural girl child and
economy. by March 2025 Nobel Prize of inertia should insurance, economics to giving up LPG NEW DELHI
The Survey said India needs to cut THE TARGET winner Richard be kept in mind retirement check tax subsidy, and

T
real interest rates, ease labour rules, Nominal GDP: 190 tn in FY19 Thaler to meet while designing savings, organ evasion and the Swachh he Economic Survey
reduce capital gains tax on startup 375 tn in FY25 policy goals. policies. donation, etc. wilful defaults. Bharat Mission. tabled in Parliament
investments and encourage infant on Thursday places a
firms to grow at a sustained 8% rate to But the path to doubling the size of the economy by 2024-25 is not going to be easy. raft of new ideas in the arena
reach the GDP target by 2024-25. The Survey lists the main challenges that the government needs to overcome. of economic policymaking,
The 2018-19 Survey, authored by embodied by the overarch-
chief economic adviser in the finance ing need for India to
ministry Krishnamurthy Subrama- embrace unfettered think-
nian, projected the Indian economy to ing in its journey towards
grow at 7% in the year ending 31 March, Uncertainty The lingering Lower global Iran sanctions New schemes becoming a $5 trillion econ- Principal economic adviser Sanjeev Sanyal (left) and chief
around monsoon shadow- growth and rising could drive up like PM-KISAN NIRMALA
slightly faster than 6.8% achieved in SITHARAMAN omy. economic adviser K.V. Subramanian release the Economic
the previous year. and farm price banking crisis trade tensions oil prices, leading need to be Finance minister In fact, the team that Survey in New Delhi on Thursday. RAMESH PATHANIA/MINT
recovery may hit could impact may affect to an increase funded without
The Survey, which was presented in an already weak demand demand for in the current affecting fiscal
worked on the Survey—an
Parliament a day before finance minis- rural demand. for credit. India’s exports. account deficit. consolidation. annual critique of the econ- found reflection in a wide India needs to accelerate to
ter Nirmala Sitharaman unveils her omy—was guided by “blue spectrum of unorthodox an 8% growth rate to achieve
maiden budget, said the strong politi- sky” thinking about what proposals—from the need to the goal of becoming a $5
cal mandate for the Modi government Drawing lessons from favourable demographic about 45% of GDP even in 2017,” the should be the right eco- emulate South-East Asian trillion economy, came suit-
would ensure political stability and the growth trajectories phase. Survey said. nomic model for Asia’s economies and tapping ably bound in a blue jacket,
bring out the animal spirits of the econ- followed by East Asian “China has relied pri- Sunil Kumar Sinha, principal econo- third-largest economy, the behavioural economics to picturing a set of wheels
omy. economies that experi- marily on savings and mist at India Ratings and Research Pvt. Survey’s author and chief drawing lessons in taxation indicating national priori-
“Investment rate, which was declin- enced long periods of investment with con- Ltd, said the emphasis of the Survey on economic adviser in the and morality from religions, ties such as growth, exports
ing from 2011-12, seems to have bot- high growth, the Survey HYPER COVERAGE sumption decreasing sig- investment as the central driver for a $5 finance ministry Krishna- and learning the principles and job creation.
tomed out. It is expected to pick up fur- postulates the centrality ON PAGES 8-11 & 14 nificantly as a share of trillion economy is easier said than murthy V. Subramanian said of right behaviour from the The Survey said insights
ther in the year 2019-20 on the back of of investment as the “key driver” that GDP. China remains an investment- done, especially against the backdrop in the preface. teachings of Gandhi.
higher credit growth and improved catalyses the economy into a self-sus- driven economy even today with its Such “blue sky” thinking The Survey, which said TURN TO PAGE 15
demand,” the Survey said. taining virtuous cycle supported by a investment and savings rates reaching TURN TO PAGE 15

NCLAT all-clear for Arcelor’s Essar Steel bid

Shayan Ghosh
shayan.g@livemint.com
MUMBAI
A
bankruptcy appeals
court on Thursday dis-
missed a plea challeng-
ing ArcelorMittal’s eligibility
to buy Essar Steel India Ltd,
clearing the way for the
world’s largest steelmaker to
establish a meaningful pres-
ence in India after months of
legal battles.
In the judgement, the
National Company Law
Appellate Tribunal (NCLAT)
also ruled that operational
creditors of Essar Steel were to
be treated on a par with finan-
cial creditors at the time of set-
tling claims. The ruling is
likely to have a far-reaching
DON’T
MISS
Ola gets approval
for London ride
Ola has got approval
from the transport
regulator to ply private
NCLAT ruled that operational
creditors were to be treated
on par with financial creditors.
impact and could significantly
improve recoveries for opera-
tional creditors, who were so
far considered to be a notch
below financial creditors.
“Instead of rejecting the res-
olution plan submitted by
ArcelorMittal India Pvt. Ltd,
Urjit Patel blames govt, RBI and
banks till 2014 for bad loan mess
Gopika Gopakumar
gopika.g@livemint.com
MUMBAI
we modify the plan to safe-
guard the rights of the opera-
tional creditors and other
financial creditors,” said
NCLAT chairperson Justice
S.J. Mukhopadhaya.
The appellate tribunal ruled
that lenders and operational
creditors would get 60.7% of
their outstanding claims and
proportionately share the
₹42,000 crore that Arcelor-
Mittal has offered to pay for
the debt-laden firm, which in
rupee terms entails a payment
of ₹30,030 crore to financial
creditors and ₹11,969 crore to
operational creditors.
Interestingly, the Indian
currency gained on Thursday,
partly because of the court rul-
ing. The sale of Essar Steel is
expected to involve about $6
billion of inflows into the forex
markets. The rupee ended at
68.51 a dollar—a level last seen
on 3 April—up 0.53% from the
Want
previous close of 68.90.
Essar Steel’s financial cred-
itors mainly comprise state-
run banks, while its opera-
tional creditors are largely its
to scale your
vendors and suppliers.
NCLAT asked the commit-
tee of creditors to take the help
of a reputed chartered
e-commerce business?
accountant firm or legal firm
to calculate the exact amount
to be distributed among each
operational creditor.
Join hands with India's largest platform
Thursday’s judgement has
two parts. In the first part, the
for managing orders and inventory
court rejected Prashant Ruia’s
plea challenging ArcelorMit- across multiple B2C and B2B
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The Congress Work-
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Reserve Bank of India (RBI)
governor Urjit Patel said, while
putting up a strong defence of
the actions of RBI under his
watch.

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course of action. P18
LS passes Aadhaar
amendment bill
The Lok Sabha on
Thursday passed a bill
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identity. P18
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Mint Brand Cell content is
created in collaboration with
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In a presentation at Stanford
University’s annual confer-
ence on Indian economic pol-
icy that touched upon bad
loans, bank regulation and
bankruptcy resolution, Patel
warned against sweeping
problems under the carpet, as
it would only delay unlocking
of capital and scuttle financing
of future investments.
In the speech—Patel’s first
since quitting RBI in Decem-
ber amid a confrontation with
the government over several
policy issues—he said the cen-
tral bank should have acted
Former Reserve Bank of India governor Urjit Patel.
earlier by ensuring that state-
run banks followed stringent
risk management processes.
Instead of installing ade-
quate risk controls, Patel said
the government encouraged
state-run banks to over-lend to
boost growth, leading to a
jump in non-performing
assets (NPAs), forcing higher
equity infusion from the gov-
ernment and consequent pres-
sure on the fiscal deficit.
Patel also said India’s state-
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of blame to go around! Prior to
2014, all stakeholders failed to
play their role adequately,” he
said.
Coincidentally, the presen-
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tation, released just a day +91 828 7790 222 contactus@unicommerce.com www.unicommerce.com
ahead of the Union budget,
was made just two days before
TURN TO PAGE 5
02 FRIDAY, 5 JULY 2019
NEW DELHI PLAIN FACTS

India leads in breaking down batsmen’s defences

Clean bowled and LBW are the ultimate breaches of a batsman’s defence. This World Cup, India leads in breaching this defence and also protecting it
Vaidik Dalal, howindialives.com m MINT GRAPHITI
LBW. On both counts, India Chart 3
feedback@livemint.com leads the charts. Chart 1 Chart 2 On both batting and bowling, India has
The combined share of these Indian bowlers have the highest share of bowled Indian batsmen have the lowest share of improved since the 2015 World Cup

O
n 26 June, two modes of dismissals was and LBW wickets bowled and LBW dismissals Share of bowled and LBW wickets taken and lost
Mode of dismissal by bowling team in World Cup 2019 (in %) Mode of dismissals by batting team in World Cup 2019 (in %) by India in World Cups (in %)
cricket website 35.3%, twice as many as bowl-
ESPNCri- ers of England, the home team, India 2011 2015 2019
Leg before wicket South Africa
cinfo.com pub- had. The next best was Sri Leg before wicket
Bowled 4.4 Bowled
lished a piece Lanka (32.4%) and Pakistan 11.8 Bowling Batting
titled, Which is the Best Ball of (27.5%) (see chart 1). In this
the World Cup?. World Cup, across all the wick- Sri Lanka Bangladesh 37
It showcased, using pictures ets that have fallen, 25.3% have West Indies 23.5 35
32.6 34
and text, 11 wicket-taking deliv- been via these two modes, India
eries from the ongoing World which shows just how high 4.4 10.8 England
Cup in England. Each delivery India is punching. 11.1 7.3 2.9
26
was a work of art, loaded with Conversely, in the batting 2.6 21.6 26.8 8.8
pace or guided by guile, and department, it has defended 7.8
England 15.6
laden with match context. Each the stumps resolutely. It has 9.4
made you remember and recorded the lowest percent- West New 16
replay. As many as seven of age of dismissals through these Indies Zealand 12
those 11 deliveries crashed into two modes among the 10 sides. 2.1 18.8 21.6 5.9 11.3 14.5 12.2 7.3
the stumps—a reminder of the Only 11.8% of the Indian wickets
rawest and the most potent to fall have either been clean Bangladesh
form of dismissal in cricket. bowled or LBW. To put that in Pakistan 13.1
17.7
Here’s where India comes in. perspective, the figure for Aus- 20.3 21.8
15.4 9.8
There’s only one tralia is twice as 3.9 16.7
delivery by an much and that for 6.8 3.6
Indian in that South Africa is South Africa 9.6 Australia
shining list: Kul- thrice as much. 8.9 Sri Lanka
deep Yadav fox-
ing Babar Azam
PLAIN India is followed
by England Australia
New Zealand Pakistan

and opening the

gates for Indian
FACTS
bowlers. How-
ever, when it comes to dismiss-
als by having a batsman clean
bowled or caught leg before
wicket (LBW), the next most
potent mode of dismissal, India
has done the best among the 10
teams in this World Cup in both
batting and bowling depart-
ments.
In the bowling department,
India has been on the offence
and has been breaking
through. Among the 10 sides, it
has earned the highest percent-
age of its dismissals through
these two modes. As many as
23.5% of the wickets taken by
Indian bowlers in the 2019
World Cup till 1 July were clean
bowled. Another 11.8% were
(17.2%) and New
Zealand (19.5%)
(see chart 2). It’s a
testament to just how good
India have been in this World
Cup.
India was always a strong
batting unit, but this shows just
how much distance the
national cricket team has trav-
elled as a bowling unit and why
it came into the tournament as
one of the best plying their
trade in the small and pretty
grounds of England.
In both batting and bowling
departments, India has
improved these numbers sig-
nificantly over 2015, which
though had dipped over 2011.
In bowling, in 2015, 16% of
scalps claimed by the Indian
bowling unit, which was led by
Chart 4
India is taking more wickets in the middle than in the death
Phase 0-10 overs 10-20 overs 21-30 overs 31-40 overs 41-50 overs
Share of wickets taken by overs (in %)
2011 12 8 13 26 41
2015 16 14 17 21 32
2019 12 9 38 15 26
Source: Cricsheet.org Data for World Cup matches beginning 2011 World Cup. For World Cup 2019, data is till 1 July
GRAPHIC BY AHMED RAZA KHAN/MINT, PHOTOGRAPH BY AP
Umesh Yadav, Mohammed Overall, in this World Cup, reduction in the share of run- tournament when it has gone By comparison, the highest India has managed to forge in
Shami, R. Ashwin and Ravindra 68% of dismissals across all outs. From 9% in 2007, it’s deep into opposition lineups. wicket-taking Indian is Moham- recent years.
Jadeja, was through bowled teams have been catches, either down to 4.8% in 2019. Coming Previously, India was taking med Shami, who was ranked Each bowler has been step-
and LBW. In other words, they by fielders or by bowlers of back to India, the other differ- most of its wickets at the back eighth with 13 wickets. He was ping up at different points in
have more than doubled their their own bowling. The share of ence in this side is when it is end, between overs 41 and 50. followed by Jasprit Bumrah, time and the table-topping
share since. Similarly, on the catches saw an increase from taking a bulk of its wickets. In From 41% in 2011, this figure fell who was ranked 20. The con- showing in World Cup 2019 on
batting side, Indian batsmen 2011 to 2015, from 50% to 72%. the 2011 World Cup, India took to 32% in 2015 and is now down trast between the absence at the the clean bowled and LBW
have reduced their share of dis- It has stayed around similar lev- only 33% of its wickets till over to 26%. As of 2 July, the highest very top on the one hand and counts is testimony to that.
missals through these two els. 30. This increased to 47% in wicket-taker in the tournament wicket-taking effectiveness, on howindialives.com is a data-
modes consistently (see chart The other notable change 2015 and stands at 59% in 2019 was Mitchell Starc, with 24 the other hand, is an accolade to base and search engine for public
3). has been the progressive and this high number is in a wickets. the multi-pronged attack that data

m MARKETS DASHBOARD More evidence of GDP data overestimation

EQUITY FOREX Nikita Kwatra two economists at the Indian
MINT

MARKETS % change vs MARKETS % change vs

nikita.k@livemint.com Institute of Management
Latest Last A A Last A A MUMBAI Ahmedabad (IIM-A), Sebastian
(index week month year week month year Morris and Tejshwi Kumari,

L
Index level) average ago ago Currency Latest average ago ago ast month, a research published earlier this year,
paper by the former chief arrived at similar conclusions
INDIAN STOCK EMERGING MARKET economic adviser to the using techniques similar to
MARKETS CURRENCIES vs the $ finance ministry, Arvind Sub- that of Subramanian.
ramanian, reignited the con- The duo estimated GDP
SENSEX 39,908 ▲ +1.2 ▼ -0.2 ▲ +12.4 Indian Rupee (per $) 68.51 ▲ -1.0 ▲ -1.1 ▲ -0.4
troversy surrounding India’s growth in recent years by
NIFTY 50 11,947 ▲ +1.3 ▼ -0.4 ▲ +11.3 Chinese Yuan 6.87 ▲ -0.1 ▲ -0.5 ▼ +3.4 gross domestic product (GDP) using proxy indicators of eco-
BANK NIFTY 31,472 ▲ +1.5 ▲ +0.2 ▲ +19.3 Brazilian Real 3.80 ▲ -1.0 ▲ -2.0 ▲ -2.7 calculations. nomic activity such India’s actual growth rate in the past few years may have been
In his paper, Sub- m as credit and exports around 5-5.5%, suggests a new study
Russian Ruble 63.49 ▼ +0.9 ▲ -2.6 ▼ +0.5
GLOBAL STOCK ramanian suggested growth to extend
INDICES Indonesian Rupiah 14,135 ▲ -0.1 ▲ -0.9 ▲ -1.7 that India’s growth SNAP FACT t h e o l d G D P growth rate as 7.2% to 7.5% manufacturing, such as trade
DOW JONES (US) 26,966 ▲ +1.4 ▲ +6.4 ▲ +11.0
rate in recent years (2004-05) series. over the last few years. They and transport, contributed
OTHER MAJOR
CURRENCY PAIRS
had been grossly overesti- Their analysis suggests that argue that actual growth was most to the overestimation.
S&P 500 (US) 2,996 ▲ +2.3 ▲ +6.8 ▲ +9.7 mated, a claim that was quickly growth rates calculated using most likely under 6% and Also read: Overestimation in
NIKKEI (Japan) 21,702 ▲ +2.2 ▲ +5.4 ▼ -0.1 Euro ($/€) 1.13 ▼ -0.8 ▲ +0.3 ▼ -3.4 criticized by the Prime Minis- the current 2011-12 series may closer to 5-5.5%. The authors the Growth Rates of National
SHANGHAI 3,005 ▲ +0.6 ▲ +5.1 ▲ +8.9 Japanese Yen 107.8 ▼ +0.2 ▲ -0.4 ▲ -2.5 ter’s Economic Advisory have overestimated the Indian suggest that one explanation Income in Recent Years? – An
COMPOSITE (China) (¥/$) Council, which suggested that economy’s real growth rate for the overestimation could Analyses Based on Extending
Subramanian’s methodology though the growth estimates be that the GDP 2011-12 series GDP04-05 through Other Indi-
HANG SENG (HK) 28,796 ▲ +1.3 ▲ +7.1 ▲ +1.2 British Pound 1.26 ▼ -1.0 ▼ -0.9 ▼ -4.9
($/£) was unusual and led to mis- they arrived at are higher than calculations do not accurately cators of Output
IBOVESPA (Brazil) 1,03,282 ▲ +2.4 ▲ +6.6 ▲ +39.3 leading conclusions about the those presented by Subrama- measure growth during eco- (bit.ly/30gZFwB)
FTSE/JSE TOP 40 51,791 ▼ -1.1 ▲ +2.2 ▲ +1.2 THE DOLLAR INDEX growth rate of Asia’s third larg- nian. The authors conclude nomic slowdowns. Snap Fact features new and
(South Africa) est economy. that it is highly unlikely that Their analysis suggests that interesting reads from the
JCI (Indonesia) 6,376 ▲ +0.8 ▲ +2.7 ▲ +11.7 Dollar index 96.8 ▲ +0.7 ▼ -0.4 ▲ +2.4 However, another study by India has maintained as high a sectors closely associated with world of research
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 DEALS FRIDAY, 5 JULY 2019
NEW DELHI 03

DEALS ROUND-UP
PEs may deploy more
capital despite risks
Funds eye opportunities in healthcare, financial services, consumer
Ridhima Saxena m MINT GRAPHITI Energean oil and gas production in East Macedonia. The Greek firm
is also buying assets under development in Egypt, Italy and Norway.
ridhima.s@livemint.com New avenues
Kavita Mehta, founder, Caymus Technologies.
MUMBAI Investors believe that the liquidity crunch that has rattled the financial
services sector in recent quarters has thrown up new entry Energean to buy EDF
P
rivate equity (PE) investors opportunities for private equity investors.
GOFUNDME CEO SOLOMON, OTHERS
INVEST IN CAYMUS TECHNOLOGIES
Skilling startup Caymus Technology Ventures Pvt. Ltd raised
are seeing opportunities to
deploy more capital,
boosted by the political sta-
Total value (in $ bn)
Number of deals
Total PE/
VC investments*
18.5
23.4
arm for up to $850 mn
an undisclosed amount from a clutch of angel investors from bility provided by the PE/VC investments in
India and the US, including Rob Solomon, chief executive Bharatiya Janta Party (BJP)-led financial services*
officer (CEO) of San Francisco-based crowd-sourcing plat- National Democratic Alliance’s Fundraising Yaacov Benmeleh & with knowledge of the matter
may slow
form GoFundMe, and the former chief operating officer of (NDA’s) massive victory in the 10.3 down on Francois de Beaupuy said in January.
GroupOn. recently concluded general elec- 53 81 89 rupee surge Energean is currently
Started in 2018 by Kavita Mehta, the Mumbai-based tions, though economic growth in costs TEL AVIV/PARIS focused on fields in Israel and
startup offers AI-powered products to help college graduates the country seems to be losing steam, 5 bit.ly/30eNrnR Greece, and the acquisition is
4

E
and experienced professionals select courses that are best fit a liquidity crunch is shaking the 3 nergean Oil and Gas Plc. a costly move for a firm of its
for them, based on their personal requirements and attrib- financial services sector, and con- 294 376 536 agreed to buy the oil and size. It plans to finance the
utes. “Now there is mass confusion over which courses to opt sumer demand is faltering. gas business of Electricite transaction by selling $265
for. Traditionally, we have relied on guidance from friends “There are several macro head- 2017 2018 2019 2017 2018 2019 de France SA’s Italian unit for million of new shares and
*Data from January-June Source: EY India
and family or seniors at work. Our firm leverages AI so that winds, including the key risk around as much as $850 million, a deal using a $600 million bridge
PARAS JAIN/MINT
candidates can make their own informed, right-fit decisions the stress in the financial sector, that will substantially broaden loan.
about the skills they want to add to their portfolio,” said which is reducing the availability of years at 89 deals worth $4 billion, “In the present market, PE invest- the Greek energy company’s Edison will be entitled to
Mehta. The company will use the funds to strengthen its core credit because of the heightened risk compared to 81 deals worth $5 billion ments are being directed towards geographic footprint. royalties associated with fur-
AI-based technology and product stack. perception. This dislocation throws in the corresponding period of 2018 companies with good business mod- Energean will pay $750 mil- ther potential developments
up interesting opportunities to and 53 deals worth $3 billion during els and poor balance sheets, which lion upfront for operational in Egypt that would bring the
FINTECH FIRM PROPELLD RAISES acquire quality businesses at reason- the same period in 2017, data from allow them to buy assets cheaper,” he assets in Egypt, Italy, Algeria, aggregate value close to $1 bil-
FUNDS FROM STELLARIS, OTHERS able valuations,” said Dhanpal Jha- EY India shows. said. the North Sea and Croatia, lion, it said Thursday in a sepa-
Bengaluru-based education financing startup Propelld veri, managing partner at private It is not just the financial services PE firms are also keenly evaluating according to a statement on rate statement. The transac-
raised ₹15 crore from early-stage venture capital firms equity firm Everstone Capital. space where PE investors are eyeing investment opportunities in other the Tel Aviv Stock Exchange, tion also includes the transfer
Stellaris Venture Partners and India Quotient. The round Investors believe that the liquidity opportunities arising out of debt sectors such as healthcare and con- one of two bourses where its of all of Edison’s future decom-
also saw participation from Taxiforsure founder crunch that has rattled the financial related troubles. The liquidity sumer sector. stock trades. It’s missioning obli-
Raghunandan G. and Livspace founder Ramakant services sector in recent quarters has crunch has meant that promoters of “We believe the narrative will con- Energean’s first Energean will pay gations.
Sharma, who thrown up new entry opportunities mid-market businesses across sec- tinue to revolve around financials, major acquisition $750 mn upfront Edison will use
participated as for PE investors who had earlier tors are also seeing their balance healthcare, technology, consumer, since listing in for operational the proceeds to
members of Stellaris’ missed the opportunity to bet on this sheets stretched and this is creating and real estate sectors. The focus will London last year, assets in Egypt, make “significant
Founder Network, space. “The crisis also presents an opportunities for investors as pro- be on acquiring high quality assets and will signifi-
Italy, Algeria, the investments” in
besides existing interesting entry point for those who moters look to deleverage through with strong growth prospects, with a cantly expand its Italy to bolster its
investor India Angel had missed the bus earlier. Interest- asset sales. clear preference for buyout transac- production and North Sea and renewable
Network Fund (IAN ingly, that entry point tions,” said Utpal Oza, revenue streams. Croatia energy portfolio,
Fund). comes at a time when DEBT-HIT BUSINESSES ON THE RADAR who heads invest- The Greek retail activities
Founded in 2017, the the liquidity crisis has ment banking at company is also and energy-effi-
fintech startup gives managed to separate PE firms are eyeing FINANCIAL services HOWEVER, investors financial services acquiring assets under devel- ciency services. It expects the
loans to students the men from the boys opportunities
out of liquidity
arising saw the highest
volume of deals in
believe there are still
concerns that need to
company Nomura opment in Egypt, Italy and deal to close by the end of the
pursuing vocational in the NBFCs (non- crunch in mid- last three years at 89 be addressed for a India. Norway. It may pay an addi- year, and sees a writedown of
training in machine banking financial market businesses deals worth $4 billion stable PE capital flow Companies that are tional $100 million following €400 million ($451 million) to
learning and hospitality companies) space,” looking at large fun- first gas from the Cassiopea €500 million following the
management, but may said S. Sriniwasan, draisings or are in a development off Italy. transaction.
Bibhu Prasad Das, founder, not have access to who heads Kotak Investment Advis- “PE investments have also distress scenario, will turn to private Bloomberg reported last Parent company EDF has a
Propelld formal bank credit. “We ors Ltd. increased as mid-market businesses markets to meet their capital needs, month that Energean was bid- programme to sell as much as
are expanding the “That is where a few PE firms that were earlier not available for sale given the lukewarm activity in pri- ding for the oil and gas busi- €3 billion of assets this year
education credit market by creating tailor-made loan could drive consolidation among are now looking for investors mary markets and the long initial ness of EDF unit Edison SpA, and next, following €10 billion
products with inputs from our institute and NBFC NBFCs, which will happen either because of balance sheet stress, and public offering (IPO) pipeline, Oza whose assets had earlier of divestments in the previous
partners, so that default risk is identified early, and the through acquisition of companies or these businesses are preferred by PE added. attracted interest from Nep- four years. Earlier this year,
downside is shared between the stakeholders,” said Bibhu through acquisition of loan portfo- firms due to their relatively cheaper However, while political stability tune Energy and Warburg Pin- EDF sold its 25% stake in Swiss
Prasad Das, founder, Propelld. lios,” he said. valuations,” said Sumit Jalan, manag- has boosted confidence, investors cus’s Apex International power producer Alpiq for
In the first six months of this year, ing director and co-head of India believe that there are still concerns Energy. about 489 million Swiss francs
B2B FIRM SUPERZOP RAISES ₹8 CR the financial services sector saw the investment banking and capital mar- that need to be addressed for a stable EDF was seeking as much as ($496 million). BLOOMBERG
FROM SIDBI VENTURE, CIIE, OTHERS highest volume of deals in last three kets at Credit Suisse, India. capital flow from PE investors. $2 billion for the assets, people feedback@livemint.com
Ahmedabad-based SuperZop, which allows kirana stores
to procure quality staples directly from a large selection of
mills, farmer producer organizations and farmers, raised
₹8 crore in a pre-Series A round from medium and small
enterprises venture
fund, Sidbi Venture
Capital, besides IIM
Ahmedabad’s
IndiaMART shares make strong market debut, close at 34% premium
technology incubator, MINT
CIIE Initiatives, and Ravindra Sonavane The stock settled at IndiaMART’s online mar- growth in revenue will help it added.
angel investor ravindra.s@ivemint.com ₹1,302.55 on the BSE, up ketplace provides buyers and to improve margins on “With high internet pene-
Gurumurthy Raman. MUMBAI 33.87%. India’s benchmark sellers a platform to discover account of operating leverage. tration and IndiaMart’s pres-
“90% of $500 billion Sensex rose 0.17% to 39908.06 products and services. IndiaMart is focused on B2B ence in different verticals and

S
food and grocery hares of IndiaMART points. As on 31 March 2018, the and enjoys a dominant posi- geography, we believe Indi-
market is served by 10 InterMESH Ltd closed at The initial public offer (IPO) company had 59.81 million tion in India,” said brokerage aMart will be able to capture
million unorganized a near 34% premium on of IndiaMART, which operates registered buyers and 4.72 Nirmal Bang, in a 24 June the rising opportunity in the
small retailers. Staples Thursday, against its issue Indiamart.com, opened on 24 million suppliers. note. industry.
is more of a channel- price of ₹973, which was the June and closed on 26 June. The suppliers had listed “We feel the B2B IndiaMART shares B e i n g an
driven product than upper end of the company’s The initial public offer saw 50.13 million items, of which segment is more opened at ₹1,180 e-commerce
brand-driven, and Vipul Patel, vice president, public offer price band of three of the company’s private 75% consisted of products, specialized and has apiece on BSE and c o m p a n y ,
Superzop is building a investments, CIIE Initiatives ₹970-973 per share. equity and venture capital while the rest was services, The IndiaMART stock ended at not attracted any climbed to a high investment is
strong channel for The business-to-business investors, including Intel Cap- according to the DRHP. ₹1,302.55 on BSE, up 33.87%. major competition majorly into
of ₹1,339, or up
staples by using technology, data science and offering (B2B) online platform’s ₹475 ital, Amadeus Capital Partners, The company reported from other large the platform,
institutional credit to small retailers. The fund will be crore initial public offer (IPO) and Quona Capital, partially adjusted consolidated net taxes, depreciation, and amor- marketplaces, such 37.6% from the which is
supporting Superzop’s team in scaling its operation in was subscribed 36.16 times last exit, according to the draft red profit of ₹85.30 crore in tization (Ebitda) stood at as Amazon, Flipkart, issue price already built,
Mumbai and strengthening its technology platform. We week. herring prospectus (DRHP) of 2018-19, down 52% from a year ₹82.30 crore, up 76.6%. and even search so the com-
are really excited about their store acquisition plan to IndiaMART InterMESH the company. ago, while total income for the The company has zero debt engines like Google. pany cost
reach 30,000 stores in next one year,” said Vipul Patel, shares opened at ₹1,180 apiece ICICI Securities, Edelweiss fiscal year was ₹507.40 crore, and ₹77 crore cash as on 31 IndiaMart enjoys pricing would not grow in comparison
vice president, investments, CIIE Initiatives. on the BSE and touched a high Financial Services and Jeffer- up 23.6% from the same period March. power and the card rate for to sales, leading to improve-
COMPILED BY RIDHIMA SAXENA of ₹1,339, or up 37.6% from the ies managed the initial share a year ago. “We feel IndiaMart can sus- paid services has increased in ment in the profitability,” the
issue price. sale of IndiaMART. Earnings before interest, tain higher growth and higher last few years,” the report report said.

‘Not all startups will see a sharp rise in valuation when raising more funds’
Deepti Chaudhary How are foreign inves- ented markets where revenue gle, Unilever, Infosys, etc.). invest in India via the first fund. world? age businesses need innovative
deepti.c@livemint.com tors perceiving India? growth still scores over profita- They are constantly scouting The biggest impact of the Often times, it is difficult to perspectives to value them. For
BENGALURU A crucial component of a bility, at least in the short-to- for innovative startups and vision fund could be exits to VC value these new age companies example, traditionally, one
healthy private equity/venture medium term. Certain sectors looking for partnerships, stra- investors on some of the con- using the traditional income would look at multiples for rev-

S
antosh N., senior advisor, capital (PE/VC) ecosystem is an like fintech and consumer tegic alliances, outright pur- sumer internet companies. approach or comparable com- enue or profitability of compa-
Duff and Phelps, one of investor’s ability to exit the internet have seen massive cap- chases to keep up with tech This would have panies’ method. rable companies to value.
the largest valuation ser- investment and make attractive ital inflow due to the available innovation and compete with a positive impact ‘The recent The companies Sometimes, these metrics do
vice providers in the world, returns. The general senti- opportunity and their ability to new age startups. on the PE/VC successful exits may not have posi- not capture the uniqueness of
believes that while revenue ment, driven by attractiveness disrupt other industries, which Will SoftBank raising its space and could have given hope tive cash flows in the business. Multiples such as
growth will continue to score of the Indian market from a is driven by lack of organized next fund impact its deal- spur deal activ- to investors that the projected enterprise value or the number
over profita- growth per- players and demographics. The making activity in India? ity. period and may not of users or the number of active
they will
bility for mint spective as well sector might consolidate as At this stage, although India In addition,
reap returns in
have reliable pro- bots created is then considered.
startups, not as recent suc- well, and therefore the valua- is a large unexplored market, it Softbank might jections in the first Alternative methods some-
all of them
INTERVIEW cessful exits, tion jump could now not be will still take some time for the start making ear- 5-to-7 years.’ place. Similarly, as times used to value these com-
will see a sharp increase in valu- have given confidence to inves- across the board. market to mature and absorb ly-stage invest- most startups dif- panies include a VC exit for-
ations. tors that it is possible for them It will be either driven by the Santosh N., senior advisor, investments of the quantum ments in India ferentiate them- mula method, or a score card
In an interview, he explains to realize significant returns on category leaders/successful Duff and Phelps. that the fund is intending to through their Asia-dedicated selves as disruptive and unique, method (comparing a fund
why foreign investors continue their investments in five to first movers and/or differenti- invest. fund. it is often difficult to find other seeking startup to other funded
to believe in India and why they seven years. ated players. Consolidation in, as most of the marquee The first fund had ear- As more and more new companies that are comparable startups adjusting the average
can expect significant returns Startups in India have among PE/VC players in their names are investors in India marked cost to $20 billion into businesses are being to them and have reliable data valuation on factors including
on their investments over a seen steep valuation portfolio companies could also already. India and had deployed built, are you looking at on their valuation multiples. market and stage). Eventually,
period of five to seven years. jumps. Is it sustainable? drive valuations. The game changer could be approximately half of it before innovative ways of driv- Similarly, it is difficult to find the use of professional judge-
Edited excerpts from the inter- Valuations are high in India It is difficult to predict if new strategic investors via their making a profitable exit in Flip- ing valuations, compared comparable transactions like ment is a key component of
view: and it is true for growth-ori- financial investors would come in-house venture funds (Goo- kart. I see them continuing to with the traditional the host company. The new estimating value.
04 FRIDAY, 5 JULY 2019
NEW DELHI MARK TO MARKET

S&P BSE Sensex Nifty 50 Nifty 500 Nifty Next 50 Nifty 100 S&P BSE Mid-cap S&P BSE Small Cap
CLOSE PERCENT CHANGE CLOSE PERCENT CHANGE CLOSE PERCENT CHANGE CLOSE PERCENT CHANGE CLOSE PERCENT CHANGE CLOSE PERCENT CHANGE CLOSE PERCENT CHANGE

39,908.06 0.17 11,946.75 0.25 9,776.80 0.20 27,762.00 0.21 12,044.80 0.25 14,933.45 -0.19 14,337.04 0.12
PREVIOUS CLOSE OPEN PREVIOUS CLOSE OPEN PREVIOUS CLOSE OPEN PREVIOUS CLOSE OPEN PREVIOUS CLOSE OPEN PREVIOUS CLOSE OPEN PREVIOUS CLOSE OPEN

39,839.25 39,917.65 11,916.75 11,928.80 9,757.30 9,767.80 27,704.90 27,726.45 12,015.20 12,027.00 14,961.86 14,986.58 14,320.04 14,343.75
HIGH LOW HIGH LOW HIGH LOW HIGH LOW HIGH LOW HIGH LOW HIGH LOW

39,979.10 39,858.33 11,969.25 11,923.65 9,793.50 9,765.20 27,817.90 27,721.70 12,066.75 12,022.90 15,010.30 14,916.40 14,375.47 14,328.61

m SHORT TAKES
Gold bull Mobius: every
Eco Survey: Of blue sky thinking
portfolio needs at least 10%
Veteran investor Mark Mobius says that gold’s
set to push higher, potentially topping $1,500
an ounce, as interest rates head lower, central
and bringing back animal spirits
banks extend purchases, and uncertainty sur-
rounding geopolitics and cryptocurrencies Aparna Iyer & Harsha Jethmalani jected at 7%. farmers is an old one.
fans demand. Mobius, who set up Mobius Cap- aparna.i@livemint.com Nevertheless, the CEA has pitched The Survey insists that India can Mojo lost
ital Partners Llp last year after three decades at his ideas to fire up the economy. achieve the 8% growth it needs by Gross value added (GVA) growth has slipped to a five-year low in fiscal 2019.

F
Franklin Templeton Investments, said in an ancy riding a virtuous self- The Survey prescribes labour building roads and ports faster. We
interview in Singapore that bullion should sustaining growth cycle reforms, a minimum wage scheme have tried this just a few years ago. Agriculture Industry Services GVA (Year-on-year growth in %)
10
always form part of a portfolio, with a holding In a slowing under a clear blue sky with and changes in policies to prevent We bungled the financing part of it,
economy, 8.3
of at least 10%. Indian
no worry in the world? small businesses from staying small. but the Survey doesn’t recommend 8 7.5
Gold has rallied in 2019, rising to the highest investors That’s the rough imagery anything specific on how to tackle
But if we are searching for a radical 6.9
level in six years, as investors contemplate turn wary in the Economic Survey wants to paint solution to the economy’s problem, this problem. 6
5.4 6.6
slowing economic growth, prospects for easier their stock and the chief economic adviser we won’t find it in the Survey. What stands out is the CEA’s argu-
market bets 4 3.3
monetary policy in the US and Europe, and fes- (CEA), Krishnamurthy Subramanian, ment that political stability through
Take for instance its prescription of 2.9
tering trade frictions. The upswing has been bit.ly/2Xs5ZEe even tweeted about adopting the maintaining policy certainty to boost the decisive mandate should kindle 2 1.5
given added momentum as central banks, so-called blue sky thinking to take the animal spirits of the economy.
investments. It is a no-brainer that if
including authorities in Russia and China, step India towards the goal But as V.K. Vijaya- 0
up purchases of gold. BLOOMBERG of being a $5 trillion DISTANT DREAM kumar, chief invest-
-2
economy. ment strategist at Geo- FY13 FY19
Trouble is, the skies THE ECONOMIC SHORT-TERM IF THE UNION jit Financial Services Source: Ministry of statistics and programme implementation, Elara Securities Research
Disappointing data are anything but blue. Survey doesn’t offer options to fire up the budget builds upon
any radical solutions economy are hardly the Survey, there isn’t
Ltd, notes: “If the sur-
NAVEEN KUMAR SAINI/MINT
The UK’s economic reports are falling short of In fact, till recently, to the economy’s there, given the lack much to expect in vey’s hope that ‘politi-
economists’ expectations. the $5 trillion goal was problems of fiscal space terms of a boost cal stability can ignite tions if implemented will have an wants implemented are medium
meant to be achieved the animal spirits and impact in the medium-to-long term. term in nature. This means if the Bud-
UK economic surprise index
150 by FY24, or about five usher in a virtuous That means short-term options to get is built on this, there isn’t much
years from now. The Survey says the markets can predict what policymak- cycle of growth’ is to bear fruit, Nir- fire up the economy are hardly there, we can expect in terms of a boost,”
100 target is now meant to be achieved by ers would do, they would gladly put mala Sitharaman should rise to the especially since the Survey itself said an economist, on condition of
75 FY25. The relaxed target may also be their whole money on the future. occasion and deliver a reform-ori- agrees to the broad view that the fiscal anonymity.
50 a stretch, since it assumes average Then the suggestion of improving ented growth budget.” space to give the economy a boost is Subramanian’s blue sky thinking,
annual growth of 8% in the next six farm productivity and encouraging Reforms is where the trouble is. missing. then, just seems like another day-
0 years, even as growth in FY20 is pro- diversification of revenue streams for Economists fear that Survey sugges- “Much of the things that the survey dream.

-50
-74.3
-100
3 Jan 2012 3 Jul 2019
Source: Citigroup, Bloomberg

VIPUL SHARMA/MINT For Bank of Baroda, real test of Once bitten, twice shy: Fortis Healthcare
UK economic surprise
index at lowest since 2012 merger would be from here on investors wary of rewarding performance
Citigroup Inc.’s UK surprise index, which
measures whether data exceeds or falls short of Aparna Iyer begins now. Analysts say that R. Sree Ram Raghuvanshi has emphasized on stock. From around the ₹220 levels
forecasts, is at the lowest since 2012 after a aparna.i@livemint.com
Smooth sailing the first quarter results should sreeram@livemint.com plans for profitability improvement in 2017, it almost halved in 2018 as
Bank of Baroda shares
string of reports undershot economists’ expec- be closely watched as it would measures in a meeting with ana- corporate governance issues came
have gained after it

P T
tations. ublic sector lender Bank disclosed its new balance
give a sense of how the merged ypically, investors factor in an lysts. to light at the company. The stock
Surveys highlight Britain’s struggles in June of Baroda’s (BoB’s) stock sheet post merger. book performed. expected future improve- The strategy is two-pronged. now trades at ₹134.
as Brexit uncertainty and fears for the global has risen nearly 8% in There are enough reasons ment in performance into While focusing on improvement in Concurrently, as the healthcare
Bank of Baroda
outlook weighed on output. IHS Markit said on the past two trading sessions. Nifty 50 index
to worry, given that the bank current stock prices. In Fortis asset utilization, the management sector faced turbulence (due to
Wednesday that the economy shrank 0.1% in While this seems to be a case of 110 has among the largest expo- Healthcare Ltd’s case, they are tak- plans to achieve cost efficiencies of pricing caps, tax changes and
the second quarter in what would be the first late reaction, investors appear 102.83 sures to non-bank lenders. ing time to reward it for an as much as ₹100 crore. demonetization) stocks such as For-
105
contraction in seven years. BLOOMBERG to be celebrating the fact they Nearly 16% of BoB’s loan book improvement in its prospects that “Management’s first tis Healthcare fell off
didn’t find any nasty surprises 100 is made up of advances to non- has already occurred. goal is to achieve From around the the investor radar, says
100.19
from the bank’s combined bal- 95 bank lenders. To be sure, not Fortis Healthcare’s shares have 73-75% occupancy, ₹220 levels in an analyst on condition
Time for fireworks ance sheet after the merger 90 all of them are in trouble. But lost 4.8% over the past year even as from the slide to 65% 2017, the stock of anonymity. But with
US stocks are outpacing the rest of the world with Vijaya Bank and bad loan- many are, and some of the the company saw a change in man- over the past two halved in 2018 on the sector in the recov-
85
at an unprecedented rate. ravaged Dena Bank. The new troubled ones are large in size. agement and fund infusion to help years, by adding new ery phase, reflected in
governance
balance sheet was disclosed 80 More importantly, the it tide over a liquidity crunch. specialties like inter- improvement in finan-
MSCI USA Price Return USD Index
last week.
29 Mar 4 Jul
bank’s insurance against Importantly, FY19 ended on a ventional radiology issues. It now cial performance of
MSCI ACWI ex-US Index
1400 India’s third largest lender
Base value taken as 100
future losses on defaulter positive note with the core India and oncology; upgrad- trades at ₹134 Apollo Hospitals
1,244.60 Source: Bloomberg
1200 now, courtesy the merger, Infrastructure Leasing and hospital business showing signs of ing existing infrastruc- Enterprise Ltd and
VIPUL SHARMA/MINT
1000 BoB detailed key metrics as on Financial Services Ltd is only stability. Revenues at the hospital ture; and improving Narayana Hrudaya-
1 April, the day the merger As BoB brought the other 25% in terms of provisioning. business grew 5.8% in the March market share in the cash market,” laya, Fortis should soon follow suit,
800
took effect. two banks up to its own provi- Analysts at Nomura noted quarter after six consecutive quar- analysts at Edelweiss Securities Ltd he adds.
600 First, the good news. The sioning standards, the write- that credit costs will remain ters of declines. said in a note after meeting the new Analysts at Nomura Financial
400 287.96 lender’s bad loan ratio didn’t off of reserves and capital ero- elevated given the high expo- Further, the company appointed Fortis Healthcare CEO. Advisory and Securities (India) Pvt.
200 worsen after swallowing the sion at the combined level is sure to non-bank lenders. as its managing director and chief Still, the recovery in the March Ltd expect the recovery to be grad-
two banks. In fact, it ramped significant. The merged Credit Suisse retained its executive officer (CEO) Ashutosh quarter and the management com- ual even as they see a steady
0
31 Dec 1987 3 Jul 2019 up insurance to entity’s Common underperform rating on the Raghuvanshi, who has a proven mentary did little to revive the For- improvement in financial perform-
Base value taken as 100 Source: Bloomberg
bring the other The merged Tier-I equity ratio stock owing to these reasons. track record of running the Naray- tis stock. The lacklustre reaction ance, thanks to a favourable base.
two to its own
entity’s Common was 8.56% com- Further, BoB will require ana Hrudayalaya Ltd hospital chain. underscores the apathy towards the “We think the disruptions are now
standards. Ergo, pared with 10.4% more capital from the govern- easing and the financials are likely
Warehouses vs malls the provision Tier-I equity ratio on a stand-alone ment to improve its ratios to record a gradual improvement as
After a long rally, the price of real estate was 8.56% as Recovery Revenues-India hospital business
(year-on-year change in %)
coverage ratio basis for BoB. again. asset utilisation and occupancy
investment trusts investing in malls is collapsing.
was 77.72% for against 10.4% on Mergers are Perhaps, the recent gains in mode 3.2
5.8 rise,” Nomura said in a note.
Bloomberg REIT Industrial/Warehouse Index the merged a stand-alone hard work and the stock can be attributed to Fortis Perhaps investors are awaiting
Bloomberg REIT Regional Mall Index Healthcare’s
700 entity, up from basis for BoB balance sheet such expectations of a recapi- the Supreme Court’s verdict on the
revenues have -0.6 -0.9
67.6% for BoB, integration is by talization, besides modest val- new promoter IHH Healthcare’s
600 grown after -2.2
pre-merger. far the easiest. uations compared with peers. declining for open offer. The apex court is
500 To keep its balance sheet The lender’s managing “At the current price, the stock -4.9 -6.9 expected to take up the case this
433.78 six consecutive
400 reasonably healthy, BoB had to director and CEO P.S. Jaya- trades at 0.65x FY21F book, quarters. month. If approved in the proposed
389.02 pay a price—a ₹70,000 crore kumar believes it would take a which we believe is reasona- form (open offer price of ₹170 per
300
hit on its net worth, estimates year for the bank to adjust to ble; hence, we maintain our -12.7 share), the current market price of
200
Nomura Financial Advisory the merger. Buy rating,” Nomura said in its Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Fortis offers good arbitrage, point
100 Source: Company FY18 FY19
and Securities (India) Pvt. Ltd. The real test of the merger note dated 28 June. out analysts at Edelweiss.
0 VIPUL SHARMA/MINT
31 Dec 1993 3 Jul 2019
Base value taken as 100 Source: Bloomberg

VIPUL SHARMA/MINT

Why can’t global equity

markets match the US?
Asset sale puts Sadbhav back on the road; still an uphill journey for investors
Americans have a fair amount to celebrate on Vatsala Kamat would be an overhang on the the roads sector, will help delev- dated leverage, has been mount-
this national holiday. Or at least, those who vatsala.k@livemint.com stocks.
Veering off Sadbhav Engineering Nifty Infra index
erage the parent’s balance sheet. ing. To that extent, the delever-
Sadbhav Infrastructure
have money tied up in the stock market do. “We would wait for execution the highway 130 Just last week, shares of Sad- aging is a welcome move.

T
The main US stock indices closed at all-time he big news of Sadbhav to pick up meaningfully and Shares of Sadbhav 120 bhav Engineering and Sadbhav That apart, the sale of BOT
highs on the eve of independence day. There Infrastructure Project working capital cycle to improve Engineering and Sadbhav 112.76 Infrastructure fell 3-4% when assets values Sadbhav Infrastruc-
are many reasons to find this surprising or dis- Ltd’s asset divestiture has before we turn constructive on Infrastructure Project have 110 CARE Ratings downgraded two ture’s project portfolio at nearly
been weighed down by a 100 108.26
concerting, but it is worth stepping back to not brought investors jumping the rating of the company,” said road assets of the latter, stating a 1.7 times the equity book. This
humongous debt.
look at the awe-inspiring way in which Corpo- to their feet in cheer. The stock Motilal Oswal Financial Services 90 delay in interest payments to signals an avid appetite for infra-
rate America continues to outpace the rest of has fallen 6% in the past two trad- Ltd in a note to clients. “Note that 80
lenders. structure assets, which is a
the world. ing sessions, and that of its par- SADE (Sadbhav Engineering) has The rating agency cited weak morale boost for such developers.
US equities may be at a record, but the rest of ent Sadbhav Engineering Ltd been facing execution challen- 70 toll collections and poor liquidity Meanwhile, deleveraging will
Base value taken as 100
66.47
the world is not. In fact, the US has far outper- has fallen 4%. Perhaps, investors ges; it had scaled down its FY19 60
31 Dec 2018 4 Jul 2019
in the two assets for the down- unlock Sadbhav Engineering’s
Source: Bloomberg
formed the rest of the world since at least 1988, are awaiting for the proceeds to revenue guidance twice and has grade. In one of the projects, tied-up funds for future project
which is when MSCI launched an index of the actually to flow in. refrained from issuing guidance VIPUL SHARMA/MINT
another rating agency Icra Ltd bids. After all, the National High-
world outside the US. The only times this was Also, government decisions for FY20.” on profits from completed pro- projects of Sadbhav Engineering, said, “Toll collection for FY19 was ways Authority of India has plans
briefly not true came during the Japanese such as allowing alternative For perspective, monetizing or jects and plough back funds into struck a deal to sell nine of 12 ₹64.95 crore while the debt obli- for 4,500km of road projects in
boom at the end of the 1980s, and the rage for routes that jeopardize toll-collec- selling operational assets at the new assets. operational road assets at an gations (interest + principal) was FY20. But as Motilal Oswal’s ana-
emerging markets in the aughts before the tion forecasts and lack of a right time is important for the On Tuesday, Sadbhav Infra- enterprise value of ₹6,600 crore. around ₹110 crore.” lysts say, the focus now shifts to
financial crisis. Other than that, dominance back-up mechanism to service steady growth of infrastructure structure, which houses all the The landmark deal, which is the This was no small worry, given execution and improvement in
has been total. BLOOMBERG loans in case of a liquidity crunch firms. This helps them to cash in BOT (build-operate-transfer) largest consolidated asset sale in Sadbhav Engineering’s consoli- the working capital cycle.

Mark to Market writers do not have positions in the companies they have discussed here
 CORPORATE FRIDAY, 5 JULY 2019
NEW DELHI 05

Patel blames
govt, RBI and
banks till 2014
for NPA mess
FROM PAGE 1
RBI’s bimonthly monetary
policy on 6 June. In the bud-
get, the first in the second term
of the Narendra Modi govern-
ment, finance minister Nir-
mala Sitharaman is expected
to announce further recapital-
ization for state-run banks.
Telecom lobby seeks tax-free m
MOVES
bonds, access to cheaper debt A weekly list of C-Suiters who have moved up
the corporate ladder either within or outside
their companies.
Appointed as chief executive
Akhil officer at Pipeline Infrastructure
Mehrotra Pvt. Ltd (PIPL) (a Brookfield
InvIT platform)
Repealing customs duty on 4G/5G network products among sops telcos have asked govt Appointed as group head of
Ashok operations and integration at
Bajpai IHH Healthcare Berhad
Navadha Pandey
navadha.p@livemint.com Ashok Appointed as president at
NEW DELHI Ramachandran Schindler India and South Asia

The government has
already pumped ₹2.1 trillion
into public sector banks since
September 2017. According to
ratings agency Icra Ltd, banks
will require a further
₹35,000-45,000 crore to sup-
port domestic credit growth of
12-13%.
According to Patel, the gov-
ernment and RBI face a tri-
lemma: it is not possible to
have dominance of public sec-
tor banks, retain independent
regulation and adhere to pub-
lic debt-GDP targets, all at the
same time.
“After fiscal dominance over
monetary policy, are we look-
ing at fiscal dominance over
banking regulation now?”
Patel said. Fiscal constraints,
he said, were forcing the gov-
ernment to use the banks it
owns to over-lend and pump-
prime the economy.
Patel also defended RBI’s
controversial circular issued
on 12 February 2018 on loan
restructuring framework, and
the move to bring 11 public sec-
tor banks under the prompt
corrective action.
He pointed out that fresh
bad loan slippages had
declined after the circular was
released.
The circular, which pre-
scribed rules for recognizing
one-day defaults, was struck
down by the Supreme Court
later, which said it was beyond
the scope of RBI’s powers.
Patel also defended RBI’s
decision to instruct banks to
initiate insolvency proceed-
ings against large defaulters.
He said the failure of banks to
take action was undermining
the credibility of the Insol-
vency and Bankruptcy Code,
forcing RBI’s hand.
T
he Cellular Operators Girirajan Appointed as chief executive officer
Association of India Murugan at Wealth India Financial Services
(COAI) has sought Amazon
admits it
incentives such as an keeps Alexa Harleen Appointed as senior vice-president
option to issue tax-free data Oberoi and project head at Tata Realty
bonds as well as creation of a sepa- forever:
rate financing body that would Report Appointed as chief financial
provide cheaper loans to telecom bit.ly/2XosZ27 Kunjal officer at Pipeline Infrastructure
operators as they battle shrinking Thackar Pvt. Ltd (PIPL) (a Brookfield
revenue streams in the midst of a InvIT platform)
tariff war in the sector.
The telecom industry lobby Madhukar Appointed as chief analytics
group has also sought access to Kumar officer at Shine.com
long-term, low-cost debt for infra-
structure projects to be provided Mahesh Appointed as chief operating
by infrastructure debt funds Bhalgat officer at Syngene International
(IDFs), according to a presentation
Appointed as partner—martech,
made by COAI to the department Milind RPA and data at DAN Consult
of telecommunications ahead of Shah
the budget that will be presented
on Friday. Appointed as deputy director,
Mint has seen a copy of the pre- Neha marketing communications at
sentation. Chimbulkar Deskera India
Infrastructure debt funds are
investment vehicles which can be Rajesh Appointed as chairman and
sponsored by commercial banks Nambiar president of Ciena India
and non-banking financial com-
panies (NBFCs) in India in which The Cellular Operators Association of India has sought a reduction in spectrum usage charges. MINT Ravindra Anil Appointed as vice-president,
domestic/offshore institutional Vaidya global markets at Vikram Solar
investors such as insurance and now. net debt stands at ₹1.18 trillion. charges between 3% and 6% of the
Appointed as managing director,
pension funds can invest through Both Airtel and Vodafone Idea Jio, the telecom unit of Reliance adjusted gross revenue (AGR) and Ruchi origination and client coverage
units and bonds issued by the are under heavy debt and incur- Industries Ltd, posted a net profit licence fees at 8% of AGR, besides Sankhe at Waterfield Advisors
infrastructure debt funds. ring losses though Jio has been of ₹840 crore in the March quar- a GST (goods and services tax) of
These funds essentially act as profitable for five quarters. ter. 18%. Sameer Appointed as business head, india
vehicles for refinancing The lobby group has Gogate production business at BBC Studios
existing debt of infrastruc- THE CRISIS IN TELECOM SECTOR sought a reduction in these
ture companies. levies. Sapna Appointed as chief marketing
India’s telecom sector AIRTEL and Voda AIRTEL’S India VODAFONE Idea RELIANCE Jio “The industry has accu- Arora officer at OLX India
has seen intense disrup- Idea are incurring wireless business
losses though Jio has posted a loss of
posted a loss of
₹4,881.9 cr in March
Infocomm posted a
net profit of ₹840
mulated unutilized input
tion following the entry of been profitable for ₹1,377.8 crore in the quarter and its net crore in the March tax of about ₹35,000 crore. Appointed as vice-president and
Reliance Jio Infocomm Ltd five quarters March quarter debt stands at ₹1.18 tn quarter This should be refunded Umair general manager, Middle East,
in September 2016 which immediately to enhance Ansari Africa and India, Travel Retail
brought down data tariffs cash flows of the industry,” EMEA at Estée Lauder
to rock-bottom and made voice Airtel’s India wireless business “Telecom/telecom infrastruc- COAI said in the presentation.
calls free. posted a loss of ₹1,377.8 crore in ture sectors should be allowed to The industry body has also bat- Venkat Appointed as chief executive
Operators which were forced to the March quarter, almost triple issue tax free bonds to reduce the ted for abolishing customs duty on Shankar officer at Parag Milk Foods
match these tariffs either shut the ₹482.2 crore loss it posted in overall cost of capital and mobilize the 4G/5G related network prod-
Appointed as managing director
shop or were acquired by bigger the year-ago period. cheaper funds and thereby help ucts such as soft switches and Y.S. and chief executive officer at
players. Vodafone Idea, which is India’s achieve the national vision of a voice over internet protocol (VoIP) Chakravarti Shriram City Union Finance
Only two private operators largest telecom operator by sub- connected India,” according to the equipment, etc., till such time as
Bharti Airtel Ltd and Vodafone scribers, posted a loss of ₹4,881.9 presentation. quality products at competitive Source : Accord India, executive search worldwide
Idea Ltd are competing with Jio crore in the March quarter and its Telcos also pay spectrum usage prices are available in the country.

m SHORT TAKES NCLAT order gives ArcelorMittal the all-clear to bid for Essar Steel
MCA orders fraud probe against FROM PAGE 1
Jet Airways
ABHIJIT BHATLEKAR/MINT tal’s eligibility to bid for Essar
Mumbai: The ministry of corpo- Steel under Section 29A of the
rate affairs (MCA) on Thursday Insolvency and Bankruptcy
ordered a probe by the Serious Code (IBC). Under Section
Fraud Investigations Office (SFIO) 29A, bidders cannot be con-
into Jet Airways (India) Ltd for nected to other defaulting
alleged siphoning of funds. Mint entities. The appellate tribunal
has seen a copy of the MCA order. said that since settled by the
Among the firms which will face Supreme Court on 4 October
the SFIO probe are Jet Lite (India) 2018, ArcelorMittal’s eligibil-
Ltd and Jet Privilege (India) Ltd. An ity as a resolution applicant
email sent to Jet Airways and its “cannot be re-agitated again
founder Naresh Goyal remained and again”. In the second part,
unanswered. JAYSHREE P. UPADHYAY the appellate tribunal dealt
with the distribution of
resources among creditors.
CCI to probe Maruti Suzuki for “In the resolution plan, 0%
(zero per cent) of their (opera-
discounting practices-order tional creditor) debt has been
RAMESH PATHANIA/MINT proposed to be paid, whereas
the financial creditors have
been proposed to be paid
92.5% of their dues and claims
of some of the operational
creditors have been notionally “More pertinently, the rul- tion.”
assessed at Re. 1/- by the reso- ing does not provide that the In May, Justice Mukhopad-
lution professional without same or proportionate pay- haya had said at an event in
any basis,” said the judgement. ments need to be made to Mumbai that both financial
This judgement has signifi- financial and operational cred- and operational creditors must
cant implications on the status itors alike, but provides that be treated with fairness in res-
of operational creditors, as this these payments should be olution plans to take over
class of creditors has made in an bankrupt firms. “Operational
now been placed at ArcelorMittal’s ‘equitable’ creditors cannot be discrimi-
the same level as eligibility as a manner, thus nated against and financial
financial creditors or resolution upholding creditors cannot act like selfish
lenders who form the the well-es- cells. These cells are what
committee of credit-
applicant ‘cannot tablished cause cancer,” he said.
ors (CoC). Opera- be re-agitated principles of The Essar Steel case per-
tional creditors are again and again’, equity and tains to a 10 million tonnes per
not part of CoCs. said NCLAT fairness and NCLAT rejected Prashant Ruia’s plea challenging ArcelorMittal’s annum steel mill in Gujarat
NCLAT has stuck applying eligibility to bid for Essar Steel. BLOOMBERG that became insolvent in
to its stand of ensur- them to the August 2017, with dues of over
ing equal treatment among distribution waterfall,” said under Section 29A, which after,” said the spokesperson. ₹54,000 crore. The highest
similarly placed creditors, thus Kalra. As a result, the onus is emerged only after the previ- An ArcleorMittal spokes- bidder for the asset is global
ensuring that payments are now on specific creditors to ous judgement of the Supreme person said in a statement: steel giant ArcelorMittal,
made to financial creditors demonstrate if they deserve Court, had not been given due “We note today’s ruling by the which has offered a resolution
proportionately, according to differential treatment, he said. consideration. NCLAT. We need to review plan with a cash payout of
Karan Kalra, head of the finan- An Essar Steel spokesperson “We are awaiting the the full written order to under- ₹42,000 crore to be distrib-
cial services segment at law said that it appears the new detailed order and will decide stand any implications on uted among a clutch of finan-
firm Nishith Desai Associates. facts regarding ineligibility our course of action there- completion of the transac- cial and operational creditors.

New Delhi: Competition Commission of India (CCI) on

Thursday said it had ordered a probe into how Maruti Suzuki
India Ltd controls discounts its dealers offer.
Mumbai runway closure led to flight cancellations: IndiGo
The CCI has now asked its investigations unit to complete RAMESH PATHANIA/MINT

the probe within 150 days. “We have seen the order on CCI Rhik Kundu On 1 July night, a SpiceJet The main runway at Mum- (DGCA) issued safety direc-
web site. We are examining the same,” said a Maruti spokes- rhik.k@livemint.com Ltd aircraft flying from Jaipur bai airport handles up to 48 tions to airlines in the wake of
person. REUTERS MUMBAI to Mumbai with 167 passen- flights an hour while the sec- multiple incidents of planes
gers overshot the main runway ondary runway overshooting run-

CCI raids Mersen over price of
equipment sold to Indian Railways
MINT New Delhi: Competition Com-
mission of India (CCI) on Thursday
raided the local unit of French firm
Mersen SA and an Indian company
over allegations they colluded on
prices of equipment supplied to
Indian Railways, said two people
familiar with the matter.
The antitrust body conducted
raids at Mersen’s two offices in
Bengaluru and at the offices of
Assam Carbon Products in Hyder-
abad and Kolkata, one of the peo-
ple said. REUTERS
L RUNWAY
ow-fare airline IndiGo,
which is run by Inter-
Globe Aviation Ltd, on
Thursday said it had to cancel
and divert a number of flights
from and to Mumbai airport
because of the closure of the
main runway since 1 July.
“There was a ripple effect
throughout the system, which
caused delays not only in
Mumbai but also in other parts
of the country and also
affected some international
flights,” the country’s largest
domestic airline said in a state-
ment.
“Aircraft also had to be
diverted to different places
after landing amid heavy rain,
coming to a stop between the
main runway and the adjacent
grassy area.
This prompted airport
authorities to close the runway
and use only the secondary
runway for all operations,
causing a partial shutdown of
the country’s second busiest
IndiGo had to cancel a number of flights to and from Mumbai airport.
airport because of the closure of the main runway since 1 July. The SpiceJet aircraft is yet
to be fully removed from the
because of the ongoing Mum- time of the operating crew has runway as of Thursday after-
bai main runway closure and become a limiting factor. noon, and it is not likely to be
needed to be recovered to put Flight duty times are a manda- operational before Thursday
it in the right rotational tory requirement with zero midnight, said a person with
sequence. This has led to a sit- tolerance, which IndiGo is direct knowledge of the matter
uation where the flight duty adhering to,” it said. on condition of anonymity.
handles up to 35. ways at various air-
As such, using only SHUT ports, including
the secondary run- Mumbai, while
way for all flight ON 1 July, a SpiceJet operating in bad
operations has aircraft flying from
Jaipur to Mumbai
weather condi-
resulted in massive overshot the main tions. The regula-
flight cancellations runway tor said the airlines
and delays. must “make availa-
Between 3-4 THIS prompted ble sufficiently
airport authorities to
July, close to 300 close the runway experienced crew
flights have been and use only the in the cockpit”,
cancelled and secondary runway adding that the
diverted from the crew rostering
airport as a result of should factor in the
the incident, said the person “fatigue element associated
mentioned above. with operations during
On 2 July, India’s aviation adverse weather conditions”.
regulator, the Directorate Press Trust of India contrib-
General of Civil Aviation uted to this story.
06 FRIDAY, 5 JULY 2019
NEW DELHI CORPORATE

Ola gets green light for Cash-strapped Dewan Housing seeks

₹1,500 crore in fresh loans every month
London taxi business Baiju Kalesh & Divya Patil
MUMBAI
person said. A spokeswoman for
Dewan Housing declined to com-
ment.

D
ewan Housing Finance Corp.,
an Indian mortgage lender
that has delayed payment on
The approval will allow Ola to mount a challenge to Uber in the UK capital some of its obligations, plans to ask
banks to lend ₹1,500 crore ($217 mil-
lion) every month to help revive the
Salman S.H. company, a person with knowledge of
salman.h@livemint.com the proposal said.
BENGALURU The financier, which has about
₹80,000 crore of obligations, will
DHFL has about ₹80,000 crore of
While lenders mull the resolution
plan, Dewan Housing will continue
looking for an investor for a stake in
the company. Founders hold about
39.6% in the company, and plan to sell
half of their shares, the person said.
The company has been selling assets
including a mutual fund, low-cost
housing-finance unit, and an educa-
tion-loan company.

I
ndia’s biggest ride-hailing platform submit the resolution plan on 10 July obligations and will submit resolution Dewan Housing shares have lost
Ola Cabs, which is run by ANI Tech- HDFC wants to a consortium of seven lenders led plan to banks on 10 July. REUTERS about 87% of their value over the past
NCLT to
nologies Pvt. Ltd, has received keep Jet
by state-run Union Bank of India, the year. They were little changed at
approval from London’s transport Airways’ person said, asking not to be identi- ing was slashed to D from AAA this ₹83.2 at the 3:30pm close in Mumbai
regulator to start private hire vehicles Mumbai fied as the discussions are private. The year as it delayed repayments. on Thursday. The financier’s liquidity
(PHV) in the capital city of the UK. headquarte other proposals include increasing Under the proposal, Dewan Hous- profile has been under stress due to
rs out of
This would allow Ola to mount a chal- resolution
the tenor of some loans and convert- ing will offer banks new loan pools as delay in “identification and induction
lenge to Uber Technologies Inc., and also plan ing part of its debt into equity, accord- security for the funds, the person said. of strategic investor” and limited
take on Daimler AG-backed “Bolt” ride- bit.ly/3069L34
ing to the person. That in turn will help lenders meet progress selling its real estate loan
hailing service, which received a licence Investor confidence was shaken their mandatory targets to lend to book, CARE Ratings said in a release
from Transport For London (TFL), Lon- after financier Infrastructure Leasing farmers and small businesses. Dewan last month.
don’s local government body, in June. & Financial Services Ltd defaulted for Housing is proposing banks fund the If the resolution plan is accepted by
Ola UK Pvt. Ltd has received a one-year the first time in June 2018, shutting company for the next six months, the the lenders, Dewan Housing will seek
carriage licence from TFL to operate the door for bank loans for many person said. approval from institutional investors
“PHV vehicles” across London where shadow lenders. DHFL was among Dewan Housing has so far securi- to either extend the maturity of its
drivers themselves are required to apply the worst hit in the wake of the IL&FS tized about ₹25,000 crore from its bonds or change the coupon rate, the
for a licence and list their vehicle as a pri- shock, which also pushed up financ- ₹1.2 trillion of loan book, the person person said. The company expects to
vately registered vehicle for hire, accord- ing costs and made it harder for non- said. The details of the proposal are repay individual investors without
ing to a company statement. Ola UK Pvt. Ltd has received a one-year carriage licence from Transport For London to bank financing companies to access subject to change and it’s unclear if changing bond terms. BLOOMBERG
The development comes just days after operate private hire vehicles across London. MINT the bond market. DHFL’s credit rat- the lenders will approve the plan, the feedback@livemint.com
Morgan Stanley analysts signalled that Ola
would become the biggest threat to Uber Ola first entered the UK in August 2018 A person directly aware of the develop-
in the UK, since Ola has raised far more with licences to operate across south ment who declined to be named said that
capital than the rest of the app-based taxi Wales, including in Cardiff, Newport, and the company has “received more than
operators. Vale of Glamorgan. 10,000 driver registrations to operate pri-
Bolt which was formerly known as Tax- It has also started its services in Austra- vate cabs across the UK”.
ify, recently re-entered the UK. Bolt has lia in February this year and named Simon “Ola will be the first ever platform to
only raised around $190 million to $280 Smith as the managing director to manage offer both PHVs and black cabs in the UK,”
SC issues notice to former Tata Trusts head
million in funding so far, the person said. The company
Prathma Sharma & PTI
compared to Ola’s massive LONDON CALLING already has been listing black Jethmalani, who appeared for owns an 18.6% stake in Tata spiracy with unknown public
war chest of $3.8 billion, cabs on its platform since its NEW DELHI the Shapoorji Pallonji Group, Group, alleged that Venkat- servants to alter the rules to get
according to a Morgan Stan- OLA first entered THE ride-hailing OLA will mount a launch in the UK in August said the com- aramanan’s com- early overseas flying rights.
the UK in Aug 2018 service provider also challenge to Uber

T
ley report last week. with licences to started its services in and also take on
across cities like Reading, Bir- he Supreme Court on plaint was erro- ments in the press In response, Venkatara-
“We believe Ola is arguably operate across Australia from Daimler-backed mingham, Cardiff, etc., said a Thursday issued a notice neously quashed The notice was note were false manan had said that in his
a greater threat if media south Wales February this year ‘Bolt’ in London company spokesperson. to R. Venkataramanan, a by the Bombay issued on appeal and defamatory to capacity as non-executive
reports of Ola’s entry into The spokesperson for Ola former managing trustee of high court. of Shapoorji the group. director of Air Asia India, he
London at the end of the year also added that the company Tata Trusts, on an appeal of The high court group challenging In an FIR on 29 had been wrongly named as an
prove accurate,” the analysts said in their operations in the country. Ola has 40,000 is “looking forward to building world- Shapoorji Pallonji Group chal- had ruled that a the quashing of May, 2018, the accused by the CBI.
report. drivers across Australia on board since, class mobility offerings for London, by lenging the quashing of its def- press note dated its defamation Central Bureau of The Bombay high court in
Ola counts SoftBank Corp., Sequoia according to the company. collaborating with drivers, riders, the gov- amation case against him. 30 May 2018,
case against him Investigation had its March 27 order said there
Capital, Accel, and automakers like Kia Based in Bengaluru, Ola has a presence ernment, and local authorities”. “London “This is nothing but a corpo- issued by Venkat- named Venkat- was nothing defamatory in the
Motors and Hyundai as its investors. The in 150 cities across India, besides opera- is one of the world’s most iconic cities and rate war,” a bench headed by aramanan does aramanan and press note, and quashed the
company is continuing efforts to build a tions in the UK, Australia and New Zea- hosts a progressive mobility environment. Chief Justice Ranjan Gogoi not amount to other top execu- process issued against Venkat-
massive war chest to battle deep-pocketed land, serving more than 150 million users We couldn’t be more excited to bring Ola said while issuing the notice. defamation. In the complaint, tives of AirAsia for allegedly aramanan.
Uber, especially in India. with more than a billion rides annually. to London in the time ahead.” Senior advocate Mahesh Shapoorji Pallonji, which entering into a criminal con- prathma.s@livemint.com

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The micro-entrepreneurs of Nizamuddin

Streaming sites see
content costs surge
ORDINARY
POST
SHUCHI BANSAL
Respond to this column at
shuchi.b@livemint.com
G
lobal media reports have claimed that American
streaming giant Netflix will spend $15 billion on
content alone in 2019. While the company gives no
separate figures on the programming expenditure
in India, it had earlier stated that Netflix India has
seen the fastest content investment for any country globally in
its first three years. To be sure, Netflix is not the only streaming
platform that is investing in original content for this market. The
nearly 30 streaming sites—both foreign and home-grown—are
pumping crores of rupees in creating original content.
Interestingly, what they are spending per episode on a show
is several times higher than the per episode cost of a soap on pop-
ular Hindi general entertainment channels. Although experts in
the business agree that the cost of producing a web series is
shooting through the roof, comparing the originals on an over-
the-top (OTT) video streaming platform and a soap on TV is like
comparing apples and oranges. They are two different worlds,
they say.
A single episode of a typical soap on a Hindi general entertain-
ment channel costs ₹8-15 lakh. A web series on Hotstar, Netflix
or Amazon Prime could cost between ₹70 lakh and ₹1 crore per
episode. In some cases, this cost has escalated to ₹5 crore an epi-
sode, and could go up to ₹7-8 crore for top-notch content.
TV soaps cannot operate with such costs as they make about
250 episodes a year and amortize the cost over that period. Plus,
they shoot on sets—mostly in living rooms. Web series are free
from such constraints. “OTT is making film-quality stuff,” says
Jehil Thakkar, partner, Deloitte India. The economics and quality
of content for web and TV cannot be compared. The cost of talent
for web series is higher. Streaming platforms have attracted a
bevy of noted filmmakers such as Sudhir Mishra, Shirish Kunder,
Sujoy Ghosh, Zoya Akhtar, Karan Johar, Farah Khan and Anurag
Kashyap, among others. Shah Rukh Khan’s film studio Red Chill-
ies has also signed up with Netflix for creating web series. “Would
you know the name of the director of any TV soap?” asks Sameer
Nair, CEO of content studio Applause Entertainment, which has
made shows like Criminal Justice, City of Dreams and Hostages for
Hotstar. Good scriptwriters and actors are also turning to digital
content thanks to the creative freedom the medium offers. After
Saif Ali Khan, it is now the turn of Akshay Kumar to feature in a
thriller for Amazon Prime Video.
Nair feels there is no point in creating another TV soap for an
OTT platform. “Audiences are looking for differentiation. India
is awakening to that at the moment,” he says, adding that for a
premium drama series, just throwing in a big star is not enough.
CORPORATE FRIDAY, 5 JULY 2019
NEW DELHI 07
A still from the ‘Sacred Games’ web series on Netflix. A single
episode of a soap on a Hindi channel costs ₹8-15 lakh, while a
web series could cost between ₹70 lakh and ₹1 crore per episode.
You need an engaging story, content and drama. Agrees media
consultant Raj Nayak: “While a star may draw attention initially,
in the long run, it’s the quality of the story, direction, production
and casting that matters. So, you get the best in each field and do
top class production. Obviously, the cost will go up.”
The costs are also skyrocketing for streaming platforms as
there are only a few production houses that are equipped to han-
dle the kind of content that streaming needs. “Capacity is con-
strained and demand is surging,” points out Thakkar.
It’s not difficult to see why streaming platforms are investing
in cutting-edge content. With close to 30 services in the fray, it
is an intensely competitive space with
The nearly 30 each being in the customer acquisition
streaming sites phase. “When they first started out
two-three years ago, they acquired
are pumping huge film libraries to attract consum-
crores of rupees ers. But the formula now is exclusive
in creating and original content,” says Thakkar.
original content “This has created an arms race of
sorts,” he adds. Hence, there is a rush
to invest in marquee properties to
attract new viewers to their platforms.
Luring customers means an approximate investment of
₹2,500 crore in original OTT content this year—all the services
put together, of course. And, this does not include the cost of film
libraries or the sports rights that some of these platforms might
have acquired.
Nayak feels this investment is only the tip of the iceberg. He
sees the floodgates opening in the next three to five years, when
besides the shows, original movies made solely for OTT will
become the norm. The next few years will be what he calls the
“diamond era” for content creators.
Shuchi Bansal is Mint’s media, marketing and advertising edi-
tor. Ordinary Post will look at pressing issues related to all three. Or
just fun stuff.
08 FRIDAY, 5 JULY 2019
NEW DELHI PERSONAL FINANCE
TOWARDS A

$5 TRILLION ECONOMY
TOP 3 STATES BOTTOM 3 STATES
WAGE FACTOR RANGE OF
710
Minimum
Maximum
MINIMUM WAGES IN 651 658
538
India needs to create not only more jobs but also decent ones for its growing labour force, a point academics, workers’ unions
and international bodies such as ILO and the World Bank have emphasized in recent times. The Economic Survey has
proposed the implementation of a national mandatory minimum wage that will help reduce poverty and distress migration.
INDIA (PER DAY IN ₹) 451 411
115 135 132
419
166
410

DELHI KARNATAKA TAMIL NADU

The Survey says such a move will reduce wage inequality without significantly affecting employment. SOURCE: ECONOMIC SURVEY 2018-19
ANDAMANS NAGALAND WEST BENGAL

A NATIONAL MINIMUM WAGE CAN

HELP CURB DISTRESS MIGRATION
Govt needs to explore ways if country can be divided into 5 wage zones for better wage management, says Survey
Prashant K. Nanda
prashant.n@livemint.com The recent NSSO report showed that India’s unemployment rate
NEW DELHI of 6.1% is at a four-decade high. PRADEEP GAUR/MINT

I Sops for young firms,

ndia needs to have a mandatory national-
level minimum wage to promote social jus-
tice and curb distress migration, said the
Economic Survey 2019 tabled in Parlia-
ment on Thursday.
The Survey said that a mandatory minimum
more investments seen
national wage will force states to pay more than
the floor rate, but not less. “An effective mini-
mum wage policy that targets the vulnerable
improving jobs growth
bottom rung of wage earners can help in driv-
ing up aggregate demand and building and
strengthening the middle class,” chief eco- Prashant K. Nanda their age, have played a crucial
nomic advisor K.V. Subramanian said. prashant.n@livemint.com role in providing perverse
The Economic Survey suggested that since NEW DELHI incentives for firms to remain
India is a large and complex country, the cen- significantly smaller in the

I
tre should explore if it can be divided into five ndia will have to create 5.5-6 Indian economic landscape.” It
wage zones for better wage management. The million jobs each year over recommended focusing incen-
move, the Survey said, will improve help the next decade, the Eco- tives on infant firms, i.e. firms
regions attract investment and reduce distress nomic Survey 2019 said on less than ten years of age, with
migration. Thursday while underlining appropriate grandfathering of
“The central government should notify a that more private investment, existing pattern of incentives to
national floor minimum wage that can vary labour reforms and incentiviz- MSMEs.
across the five geographical regions. There- ing young companies will lead The Survey said that small
after, states can fix the minimum wages, which to ample employment genera- firms contributed only 23% of
shall not be less than the ‘floor wage’. This tion. the total employment in orga-
would bring some uniformity in minimum “Investment, especially pri- nized manufacturing in 2016-17
wages across the country and make all states vate investment, is the ‘key while large firms comprised the
almost equally attractive from the point of view driver’ that drives demand, cre- remaining 77%.
of labour cost for investment, as well as reduce ates capacity, increases labour “Inter alia, the Survey
distress migration,” the Survey said. productivity, introduces new focuses on nourishing MSMEs
It advised that the proposed labour code technology, allows creative to create jobs and become more
should include a provision for a minimum In recent years, minimum wage systems have been strengthened by many countries to lift workers out of poverty and to reduce levels of inequality. destruction, and generates productive so that they can
wage for both informal and formal sector jobs,” the Economic Survey become internationally com-
workers, as 93% of the labour force is engaged minimum wages can promote social justice ter remunerations for the working class. In a as the concept of a national minimum wage said. petitive, enhancing legal
in unorganized work. without any major negative implication for November 2018 report, ILO said that around will affect job creation. “If we assume that the labour reform, ensuring consistency
“Despite India’s outstanding growth in the employment if wages are set at an adequate 41% of Indian employees feel they are poorly “A well-designed minimum wage system can force participation rate (LFPR) of policy with the vision and the
last two decades, low pay and wage inequality level, the Survey argued. paid—India stood fourth from the bottom be a potent tool for protecting workers and would remain at about 60% in strategic blueprint, reducing
remain serious obstacles towards achieving The system in India is extremely complex among the 22 countries of the Asia Pacific alleviating poverty, if set at an appropriate the next two decades, about the cost of capital, and rational-
inclusive growth. An effective minimum wage with 1,915 minimum wages defined for various region, only above Bangladesh, Pakistan and level that ensures compliance,” the Economic 55-60 lakh (5.5 million-6 mil- izing the risk-return trade-off
policy that targets the vulnerable bottom rung scheduled job categories. “Today, there are Mongolia. India’s problem is higher informal Survey said, further highlighting how wage lion) jobs will have to be created for investments,” it added.
of wage earners can help in driving up employment, besides poor quality and disparity among genders and geographies is a annually over the next decade,” The Survey said there is a
aggregate demand, and building and low-paid jobs in the formal sector, said key challenge in the country. the Survey said. general apprehension that high
strengthening the middle class, and A statutory national minimum K.R. Shyam Sundar, a labour economist International experience suggests that Growth in micro, small and investment rate will substitute
thus spur a phase of sustainable and wage move is good but dividing and professor at XLRI Jamshedpur. greater compliance with minimum wages has medium enterprises (MSMEs) labour. This has led to much
inclusive growth,” said the survey, add- the country into five wage zones While the gradual growth in the formal led to a reduction in wage inequality. India’s not only creates greater profits debate about labour-intensive
ing that one in every three wage work- sector’s share in the labour market is a experience on the impact of minimum wages for their promoters but also versus capital-intensive modes
ers in India is not protected by the mini- will complicate the process. good sign, the government has to put in on wage inequality needs to be evaluated, contributes to job creation and of production.
mum wage law. K.R. SHYAM SUNDAR place systems that will improve the keeping in mind the segmentation in the productivity in the economy. Jobs have been a constant
“Minimum wages should be fixed for Labour economist, professor at XLRI Jamshedpur quality of jobs, he added. Short-term labour market and the differences across vari- “Our policies must, therefore, debate in India with the gov-
four categories namely, unskilled, semi- contractual employment in the formal ous categories of workers. focus on enabling MSMEs to ernment stating that employ-
skilled, skilled and highly skilled, based on the nearly 429 scheduled employment and 1,915 sector, or in labour-intensive sectors, will not The Economic Survey said effective imple- grow by unshackling them,” ment generation is not that bad
geographical region and should cover all work- scheduled job categories for unskilled work- help, Sundar said. mentation and monitoring will be key to a the Survey said. whereas critics argue that India
ers...,” it added. ers. This massive expansion in job categories While workers’ unions have been talking national minimum wage floor rate. “A simple, It said, “restrictive labour is passing through a tough
In recent years, minimum wage systems and wage rates has led to major variations, not about better wages and supporting a national coherent and enforceable minimum wage sys- regulations, which exempt phase of jobless growth.
have been strengthened by many countries to only across states, but also within states,” the floor price, industry bodies have expressed tem should be designed with the aid of tech- small firms from such regula- The recent NSSO report
lift workers out of poverty and to reduce levels Survey added. their reservations. In June, the Confederation nology as minimum wages push wages up and tions, and other size-based showed that India’s unemploy-
of inequality. The renewed interest arises as The International Labour Organization of Indian Industries (CII) said that states should reduce wage inequality without significantly incentives, which provide ben- ment rate of 6.1% is at a four-
recent literature and evidence suggest that (ILO) has been advocating decent jobs and bet- have the power to determine minimum wages affecting employment.” efits to MSMEs irrespective of decade high.

Survey cites Rajasthan’s labour reform as ideal model to boost jobs, productivity
Prashant K. Nanda India. However, following the of 8.9% in 2013. membership requirement to han, Uttar Pradesh, Odisha
prashant.n@livemint.com law change, the number of Factory output during the form a union as 30% of total and Maharashtra as those
NEW DELHI firms with 100 employees or same period grew more than workmen at an establishment with flexible labour laws and
more have increased at a sig- seven times in Rajasthan, the from 15% earlier. seven states including West

U
nderlining the need
for flexibility in labour
laws, the Economic
Survey 2019 on Thursday
cited the Rajasthan model of
labour reforms to boost
employment and factory pro-
ductivity.
Taking 2014-15 as the base
year when labour reforms
picked up pace in Rajasthan,
the Economic Survey said the
state performed much better
in terms of factory output,
growth in the number of large
factories and jobs creation
than the rest of India.
“In 2014-15, the average
number of firms with 100
employees or more are similar
for Rajasthan and the rest of
nificantly higher rate in
Rajasthan than in the rest of
India,” said the Economic
Survey.
The Survey said it com-
pared the number of operat-
ing factories employing more
than 100 employees in the
state, the average number of
workers per factory, total out-
put and total output per fac-
tory.
“It can be clearly seen that,
for all variables, compound
annual growth rate post-la-
bour reforms in Rajasthan has
increased significantly vis-à-
vis the rest of India,” it said.
The Survey said two years
before the reforms, the num-
bers of factories deploying
Industries view the labour reforms introduced in Rajasthan as progressive, while workers’ unions
say they are anti-worker and regressive.
more than 100 workers each
in the state were growing on
an average 3.65%, and two
years post labour reforms, the
growth accelerated to 9.33%.
For the rest of India, this
growth was 4.56% in 2013 and
5.52% in 2017.
HT
Similarly, the average
employee headcount in a
Rajasthan factory grew 4.17%
in 2017 compared to a decline
Economic Survey said. The In another change, the state Bengal, Assam, Jharkhand,
growth rate is a little less than has said that no prior govern- Kerala and Bihar as inflexible.
double for the rest of India. ment nod is required for com- “Studies have found that on
The rest of India figure calcu- panies employing up to 300 an average, plants in labour-
lation took into people for firing intensive industries and in
account average In Rajasthan, and laying off states that have transited
growth in 20 the average workers or shut- towards more flexible labour
large states in employee count ting down units. markets, such as Uttar Pra-
terms of size and in factories grew The earlier limit desh or Gujarat, are 25.4%
economic activ- was 100 workers. more productive than their
4.17% in 2017
ity. Besides, the counterparts in states like
While indus- against a decline state’s laws now West Bengal or Chhattisgarh
tries view the of 8.9% in 2013 mandates that a that continue to have labour
labour reforms worker can raise rigidities,” the Economic Sur-
introduced in an objection vey said.
Rajasthan as progressive, about wrongful termination Former NITI Aayog chair-
workers’ union see them as only within three years. There man and economist Arvind
anti-worker and regressive. was no deadline earlier. Panagariya had praised
To reduce trade union influ- The Economic Survey clas- Rajasthan for its labour
ence, the state has amended sified 14 states including Pun- reforms that paved way for
laws to increase the minimum jab, Haryana, Gujarat, Rajast- ease of doing business.

1,915
The number of scheduled job categories and
minimum wage types for unskilled workers.
This expansion has led to major variations
The Economic Survey 2019
depicts gains from advancement
in social sector, adoption of
technology and energy security.
NARENDRA MODI
There is good focus on building a
narrative in the Survey that will
convince people and politicians
about the need for reforms.
ARVIND VIRMANI
It appears to me that the
government, speaking through
the Economic Survey, is
pessimistic about the economy.
P. CHIDAMBARAM
Economic Survey 2019 gives us a
blueprint of how we can become
a $5 trillion economy by 2025 as
envisioned by PM Modi.
SMRITI IRANI
Prime Minister Former chief economic adviser Former finance minister Union minister
not only across, but also within states.
 PERSONAL FINANCE FRIDAY, 5 JULY 2019
NEW DELHI 09
TOWARDS A

$5 TRILLION ECONOMY
CLEANLINESS DRIVE OPEN DEFECATION 73.99
82.95
FREE STATUS (IN %)

T he Swachh Bharat Mission should focus on achieving 100% disposal of solid and liquid waste. Currently, many states are not
doing much in this regard. Scientific techniques for safe and effective disposal of waste should be next on the agenda for
this mission. As the economy grows, the culture of maintaining swachhata (cleanliness) at public places should become an 5.84
45.36

integral part of a clean India. SOURCE: ECONOMIC SURVEY 2019 GOA ODISHA TELANGANA BIHAR

SURVEY SETS AGENDA TO BRING Resolution road

Status of bankruptcy resolution under IBC

94 ₹1.73
ABOUT BEHAVIOURAL CHANGE Cases in which
resolution has
been achieved
trillion
Lenders’ claims

Success of schemes such as Swachh Bharat, Ujjwala is testimony to potential for behavioural change, says Survey
₹74,497 43%
crore Recovery rate
for lenders’
Amount recovered dues
Elizabeth Roche & Neetu Chandra Sarma
SANTOSH KUMAR SHARMA/MINT
NEW DELHI

Small companies use

T
he Economic Survey 2019 has drawn
on Nobel Laureate Richard Thaler’s
Behavioural Economics Theory to lay
out what it describes as an “ambitious
agenda” for behaviour change that
IBC to recover dues
will bring in social change, which in turn, will
help India transit to a $5 trillion economy by
2024-25.
The Survey, tabled in Parliament by finance
from large businesses
minister Nirmala Sitharaman on Thursday, and
authored by chief economic adviser Krishna- Gireesh Chandra Prasad invokes bankruptcy proceed-
murthy V. Subramanian, said flagship pro- gireesh.p@livemint.com ings. Besides, major share-
grammes initiated by Prime Minister Narendra NEW DELHI holders of defaulting compa-
Modi such as Swacch Bharat Mission, Jan Dhan nies are barred under the code

S
Yojana and Beti Bachao Beti Padhao, “provide mall businesses that do from bidding for their com-
testimony to the potential for behavioural not get their dues cleared pany before paying back their
change in India”. “The Survey, therefore, lays on time from large busi- dues to lenders.
out an ambitious agenda for behavioural change ness clients are making use of “The IBC has paved the way
by applying the principles of behavioural eco- India’s new bankruptcy sys- for operational creditors,
nomics to several issues, including gender tem as a recovery tool, accord- mostly SMEs and small ven-
equality, a healthy and beautiful India, savings, ing to the Economic Survey dors to use the IBC as a recov-
tax compliance and credit quality,” it said. 2019 tabled in Parliament on ery tool. The threat of promot-
“Given our rich cultural and spiritual heri- Thursday by finance minister ers losing control of the com-
tage, social norms play a very important role in Nirmala Sitharaman. pany or protracted legal
shaping the behaviour of each one of us. Behav- The Survey, which made a proceedings is forcing many
ioural economics provides the necessary tools strong case for policymakers corporate defaulters to pay off
and principles to not only understand how to use insights from behav- their debt even before the
norms affect behaviour, but also to utilize these ioural economics to make insolvency can be started,”
norms to effect behavioural change,” it added. impactful public policies, has said the Survey authored by
According to Subramanian, Swachh Bharat highlighted the effect India’s chief economic adviser in the
Mission (SBM) had resulted in the improvement new bankruptcy system has finance ministry Krishnamur-
of key primary health indicators–diarrhoea had on lender-borrower rela- thy Subramanian.
deaths among children under five years had The Survey said the Swachh Bharat Mission had resulted in the improvement of key primary health indicators. BLOOMBERG tions. The new system came The IBC has made a signifi-
reduced significantly in the past four years. into operation in 2016. cant impact on the way default
Building toilets was a key feature of SBM. cases also declined with higher SBM coverage. line” households to voluntarily surrender their a gentle nudge.” The Survey said “nudge policies The insolvency and bank- on debt repayment is viewed
Around 99.2% of rural India has got individ- With improved sanitation and 100% open LPG subsidies. For every household that con- gently steer people towards desirable behaviour ruptcy code (IBC) has, until and treated by promoters and
ual household latrines (IHHL) coverage in the defecation free (ODF) areas, diarrhoea cases tributed, a below poverty level household was while preserving their liberty to choose” and the February, resulted in 6,079 managements. It has initiated
last four years under SBM, which has had signif- reduced significantly across Gujarat, Tamil promised a gas connection. government was planning to go ahead with the cases involving ₹2.8 trillion a cultural shift in the dynamics
icant impact on health. For example, an esti- Nadu, West Bengal and Bihar. Going forward, “The lack of economic incentives in this pro- programmes to usher social change. being withdrawn before between lenders and borrow-
mated 140,000 deaths were reported due to the Survey said, SBM needs to incorporate envi- gramme means the campaign relies entirely on The Beti Bachao Beti Padhao campaign will admission in tribunals under ers, said the Survey.
diarrhoeal diseases in 2014. This has declined to ronmental and water management issues for the better judgement of people to voluntarily also be scaled up to Beti Aapki Dhan Lakshmi the provisions of the code, the Lenders are recovering
about 50,000 deaths in 2017-2018. give up their subsidies,” the report said, Aur Vijay Lakshmi to represent the “change” Survey pointed out, indicating about 43% of their dues under
While diarrhoea accounted for 11% providing statistics to show how the towards gender equality, the Survey said. the reliance banks as well as IBC, nearly double of what
deaths of children under five in 2013, an The government’s move to campaign “heralded a significant change The contentious issue of tax evasion also operational creditors—ven- they used to under the previ-
independent survey claims it is around invest in behavioural economics in the form of voluntary giving up of sub- found a mention. Research across countries dors, material suppliers and ous system of debt recovery
8.6% now. will have a long-lasting impact sidies”. “While this represents a good show that paying taxes was dependent on “tax service providers of corporate tribunals and other mecha-
Districts with low IHHL coverage suf- beginning, the potential to expand this morale”, which is driven by vertical fairness (the borrowers—place on the nisms, the Survey said.
fered more from diarrhoea, malaria, still on India’s health. number remains large,” it added. perception that the tax is commensurate to ben- bankruptcy code to recover The Survey, citing RBI
births and low birth weight, when com- DINESH AGGARWAL “In fact, ‘Give It Up’s task is less arduous efits received from the government) and hori- their dues. reports, pointed out that
pared to districts with high IHHL cover- Senior technical advisor, IPE Global Ltd than Beti Bachao, Beti Padao and SBM— zontal fairness (the difference in the taxes paid India’s bankruptcy reforms ₹50,000 crore has been
age—indicating that lack of sanitation while the latter programmes required by various sections of society). “If these two per- have effectively reset the bal- received by banks from previ-
and hygiene are the primary reasons for these sustainable improvements in the long term. continuous effort to dislodge mind-sets that pre- ceptions were rectified, tax compliance would ance between the rights of ously non-performing
health problems, the Survey said. Among the successful programmes to intro- vailed for decades, ‘Give It Up’ requires only a improve dramatically, the Survey said. Reduc- shareholders of defaulting accounts . The Survey also said
“The major finding of this analysis was that all duce behavioural change was the Ujjwala one-time action that is inconsequential to most ing corruption, discouraging conspicuous dis- companies and those of their an additional ₹50,000 crore
these health indicators improved significantly scheme, which sought to move from incandes- affluent households,” the Survey said. play of wealth and inculcating a sense of pride of creditors. has been “upgraded” from
in both groups after the implementation of cent to LED bulbs to promote energy efficiency, “Behavioural economics tells us that even if being the highest taxpayer in a district would go The IBC makes it a real pos- non-standard to standard
SBM,” the report added. For still births, too, the among other benefits. Another example was the people are truly interested in giving up their a long way in ensuring behavioural change vis- sibility for owners of a default- assets, pointing to a behav-
numbers showed significant improvement in subsidy “Give It Up” campaign, under which the subsidies; their actions may differ from their à-vis tax compliance, it said. ing firm to lose control of his or ioural change in the lending
districts with more toilets. Low birth-weight Modi government encouraged “above poverty intent as they need to be moved to action with elizabeth.r@livemint.com her enterprise once a creditor ecosystem.

Survey suggests policy tweaks to improve voluntary surrender of LPG subsidies

BLOOMBERG
Utpal Bhaskar be entered. tious agenda” for behavioural earlier target of 50 million. Of such as shared geographical
utpal.b@livemint.com This comes in the backdrop change that will help India these 73.11 million households locality. The ‘scroll of honour’
NEW DELHI of marquee schemes such as transit to a $5 trillion economy got access to cooking gas does not leverage this crucial
the Pradhan Mantri Ujjwala by 2024. under the scheme as on 3 July. insight, as people simply can-

D
omestic cooking gas
consumers in Aruna-
chal Pradesh, Naga-
land, Manipur and Mizoram
took the lead in voluntarily
surrendering their subsidies,
according to the Economic
Survey 2019 presented on
Thursday.
The Survey suggested a
strategy tweak for improving
the scheme’s efficacy by main-
taining a centralized list of
names of those who had given
up their subsidies, independ-
ent of the gas company, and
displaying their photographs
in the “scroll of honour”. Cur-
rently, to find a name on the
long lists, the consumer num-
ber of the subscriber needs to
Yojana (PMUY), which pro-
vides free cooking gas connec-
tions to poor families, contrib-
uting to the National Demo-
cratic Alliance’s (NDA’s) win in
the 17th Lok Sabha elections.
“It can be further observed
that north eastern states like
Arunachal Pradesh, Nagaland,
Manipur and Mizoram have
higher rate of subsidy surren-
der as compared to larger
states availing much more sub-
sidy,” the Survey said.
The scheme’s messaging
was simple. For every house-
hold that gave up their domes-
tic cooking gas subsidy, a
below poverty line (BPL)
household would receive a gas
connection. “Given their iner-
About 73 million households got access to cooking gas through the Ujjwala scheme as of July.
tia, of the nineteen crore peo-
ple who did not give up their
subsidy, many may have
intended to give up their sub-
sidy, but have simply not been
nudged to action,” the Survey
added.
The Economic Survey 2019
has drawn on Nobel Laureate
Richard Thaler’s behavioural
economics theory to lay out
what it describes as an “ambi-
The Ujjwala programme, “The campaign also not find others they may know
launched on 1 May 2016, aims attempts to leverage the power or can relate to.”
to lay the basis for a fundamen- of social norms, but with lim- In a case study, ‘Lighting up
tal transformation at the bot- ited success. People act when Lives through Cooking Gas
tom of the pyra- they see others and Transforming Society’,
mid by covering The Ujjwala act. Information Prof. S.K. Barua, former
715 districts. A scheme’s ambit campaigns do not, director and faculty member of
cash assistance of has expanded to however, ade- IIM Ahmedabad, said provid-
₹1,600 is given to 80 million poor quately empha- ing universal access to LPG has
each beneficiary
families from the size what the
transformed the lives of the
to get a deposit- (metaphorical) destitute.
free new connec- earlier target of neighbours are “The lack of economic
tion, thereby 50 million doing,” the Sur- incentives in this programme
helping improve vey said, adding: means the campaign relies
energy access. “People act posi- entirely on the better judg-
The connections are given in tively when they see others act ment of people to voluntarily
the name of the women heads positively, and particularly give up their subsidies,” the
of households. The scheme has when they can relate to such Survey said. “While this repre-
gained traction with its ambit individuals. In fact, people can sents a good beginning, the
being expanded to include 80 relate to others through even potential to expand this num-
million poor families from the seemingly innocuous traits ber remains large.”

44 %
The increase in enrolment for welfare schemes
such as MGNREGS in drought-affected blocks
through effective use of technology, according
to the Economic Survey 2019
The Survey is truer than the tall
claims of the BJP govt, even
though it attempts to whitewash
their failures in past five years.
RANDEEP SURJEWALA
Chief Congress spokesperson
GDP growth at 7% in 2020 will
likely keep India as the fastest
growing economy, a bright spot
amid slowing global growth.
BAIJAYANT ‘JAY’ PANDA
BJP spokesperson
The Economic Survey has
proposed a strategy for
achieving economic equilibrium
in a holistic manner.
PRAVIN SRIVASTAVA
Chief statistician of India and secretary, Mospi
The 7% growth pegged by the
Economic Survey is a pragmatic
target and with the right policy
levers in place.
CHANDRAJIT BANERJEE
CII director-general
10 FRIDAY, 5 JULY 2019
NEW DELHI POLICY
TOWARDS A

$5 TRILLION ECONOMY
POWERING UP PRIMARY ENERGY

0.0003 0.00035 0.0004

CONSUMPTION IN

I mproving energy efficiency has resulted in total cost savings of around ₹53,000 crore in 2017-18 and reduced 108.28 million
tonnes of carbon dioxide emission. The primary energy intensity of India’s gross domestic product (GDP) has seen a decline
over the years and fell from 0.0004 tonnes of oil equivalent (TOE) in 1990 to 0.0002 TOE in 2017. The overall size of the energy
INDIA (TOE/GDP IN $)

efficiency market in India is estimated to be around $22.81 billion. SOURCE: BP ENERGY, WORLD BANK
1990 1995 2000 2005 2010 2015

HT

INDIA WILL NEED $250 BN IN GREEN

ENERGY FUNDS FROM 2023 TO 2030
Investment opportunity for over $30 bn per year is expected to come up for next decade, says Economic Survey
Utpal Bhaskar
utpal.b@livemint.com The preliminary total estimate for meeting India’s climate change
NEW DELHI actions between now and 2030 is $2.5 trillion (at 2014-15 prices).

I Raising funds to fight

ndia’s emerging green economy will require
additional investments of around $80 bil-
lion till 2022, growing more than threefold
to $250 billion during 2023-30, said the
Economic Survey 2019, which was pre-
sented in Parliament on Thursday.
climate change could
The investment estimates, which have been
made at current prices, come at a time when
India has become one of the top renewable pro-
ducers globally with ambitious capacity expan-
be a huge challenge
sion plans. The country has an installed renewa-
ble energy capacity of about 80 gigawatts (GW) Srishti Choudhary and make cities climate resil-
and is running the world’s largest renewable srishti.c@livemint.com ient in key areas such as agri-
energy programme with plans to achieve NEW DELHI culture, forestry, fisheries
175GW by 2022 and 500GW by 2030, as part of infrastructure, water resour-

F
its climate commitments. inding the financial ces, and ecosystems, accord-
“Thus, on an annualized basis, investment resources to meet nation- ing to initial estimates as given
opportunity for over $30 billion per year is ally determined contri- in the NDCs.
expected to come up for the next decade and butions (NDCs) under climate Additional investments will
beyond,” the Survey said. action would be a ‘daunting be needed for greater resil-
The push for green energy also comes against challenge’, according to the ience and better disaster man-
the backdrop of the Organization of the Petro- Economic Survey 2019. NDCs agement. The preliminary
leum Exporting Countries (Opec)-plus arrange- outline actions that India total estimate for meeting
ment extending its compact for production intends to undertake post India’s climate change actions
cuts. The production cut extension will have a 2020 to contribute to the fight between now and 2030 is $2.5
wide-ranging impact on energy markets, given against climate change. trillion (at 2014-15 prices).
that Opec accounts for around 40% of the global India has been progressing “Finding required financial
output. It is expected to have a particular fallout rapidly towards achieving sus- resources, especially from the
on India due to the Opec accounting for around tainable development goals, private sector, is going to be a
83% of the country’s total crude oil imports. demonstrating its responsibil- daunting challenge,” said the
India is ranked fourth and fifth, globally, in ity towards acknowledging report. This would mean
installed capacities for wind and solar power, India has an installed renewable energy capacity of about 80GW and has plans to achieve 175GW by 2022 and 500GW by 2030. AFP emerging threats from climate mobilizing resources from a
respectively. change, the Survey said. variety of sources, in particular
With competitive solar bids and India’s wind climate change. The LSE move follows the deci- ulation even as the National Democratic Alli- ing to the Survey. Also, the implementation of However, the Survey said it the private sector, as well as
energy sector having transitioned from a sion of Norway’s Government Pension Fund ance (NDA) government has set an ambitious various energy efficiency measures has resulted continues to face “myriad from domestic public budgets
feed-in tariff regime, which ensures a fixed price Global (GPFG), the world’s largest sovereign task of becoming a $5 trillion economy by in total cost savings of around ₹53,000 crore in developmental challenges”, and international public
for wind power producers, to tariff-based com- wealth fund, to stop investing in oil and gas 2024-25. The Survey said that the ‘problem of 2017-18 and contributed in reducing 108.28 mil- including “lack of adequate finance, it said.
petitive auctions, obtaining finance at the low- explorers globally. energy poverty has been more pervasive than lion tonnes of carbon dioxide emission, prima- resources” without which the Private sector financing has
est cost has become key. The Survey added that a two-and-a-half times income poverty”. rily from marquee schemes such as perform, proposed NDCs, which are a been mostly done by banks.
“The solar tariff has come down from around increase in India’s per capita energy consump- “Energy intensity of India’s GDP has been achieve and trade (PAT) programme, Unnat cornerstone of the Paris However, increasing the scale
₹18/kWh in 2010 to ₹2.44/kWh in bids declining in the recent past, which is Jyoti By Affordable LEDs for All (UJALA) and Agreement on greenhouse gas of sustainable investments
conducted in 2018. Similarly, for wind reflective of increases in the efficiency of the Standards and Labeling Programme. emissions, would not be ful- may create capacity problems
power, the tariff has declined from an The next priority is to bring a energy use. However, India cannot “The overall electricity savings due to energy filled. “The international com- for banks if they are the pri-
average of ₹4.2/kWh in 2013-14 to ₹2.43/ change in the energy mix and become an upper-middle-income coun- efficiency measures is 7.21% of the net electricity munity witnessed various mary providers of sustainable
kWh in December 2017,” the Survey keep in mind our commitment try without (i) rapidly raising its share of consumption in 2017-18, total thermal energy claims by developed countries debt, the report said. “There-
said. the global energy consumption com- saved is 2.7% of the net thermal energy con- about climate finance flows, fore, capital market products
The global energy landscape has been to global community. mensurate with its share of the global sumption and 2.0% of the net energy supply,” but the actual amount of flows are required to free up the
rapidly evolving. In a huge leg-up for RAJ KUMAR SINGH population, and (ii) ensuring universal the Survey said. is far from these claims,” the banks’ balance sheet capacity
green energy investing, the London Power minister access to adequate modern commercial Having greater energy efficiency is crucial for annual document said. and allow them to underwrite
Stock Exchange (LSE) has classified oil energy at affordable prices,” the Survey India that is now the biggest emitter of green- India would need around loans to meet the accelerating
and gas stocks as non-renewable energy. The tion will help it grow the real per capita gross added. house gases after the US and China, and which $206 billion (at 2014-15 prices) demands for new sustainable
move marks a fundamental change in the global domestic product (GDP) by $5,000 (in 2010 pri- India has also emerged as the voice of con- is also among nations most vulnerable to cli- between 2015 and 2030 to investments,” it said.
investment culture against the backdrop of ces). Also, if India has to achieve the human suming nations amid global uncertainties in the mate change. India plans to reduce its carbon implement new technologies Developed countries had
growing climate concerns with several coun- development index (HDI) level of 0.8, the per energy markets with supplies from Iran and footprint by 33-35% from its 2005 levels by and practices in cultivation, committed to $100 billion per
tries focussing on renewable energy. capita energy consumption has to quadruple. Venezuela drying up and tension escalating in 2030, as part of its commitments to the United improve crop production, annum for climate adaptation
Also, multilateral and bilateral agencies as This comes against the backdrop of India the Persian Gulf. This also comes at a time when Nations Framework Convention on Climate increase forest cover, water- and mitigation by 2020. How-
well as sovereign wealth funds have been ceas- using only around 6% of the world’s primary the overall size of the energy efficiency market Change adopted by 195 countries in Paris in shed development pro- ever, these commitments have
ing investments in businesses that contribute to energy despite it having 18% of the world’s pop- in India is estimated to be $22.81 billion, accord- 2015. grammes, flood management not materialized.

Focus on transforming India into an EV manufacturing hub on lines of Detroit

MINT
Malyaban Ghosh once a robust network is built focus on setting up adequate Even fast chargers can take ket share of electric cars is a
malyaban.g@livemint.com for charging them and their charging infrastructure for around half an hour to charge meagre 0.06%. Electric two-
NEW DELHI battery costs controlled. promoting such vehicles. The an electric car while slow char- wheelers comprise a major part
The focus on EVs stems from lack of charging stations is one gers could take even 8 hours,” of EV sales, with sales of around

T
he National Democratic
Alliance (NDA) govern-
ment should aim to
develop India into a manufac-
turing centre for electric vehi-
cles (EVs) and related compo-
nents on the lines of the US
automotive hub of Detroit,
according to the Economic
Survey 2019 presented on
Thursday.
This would accelerate adop-
tion of electric mobility in India
and ensure the development of
a proper ecosystem for such
eco-friendly vehicles.
The Survey also takes note of
the lack of charging infrastruc-
ture for EVs and the need to
invest in battery technology
because sales of EVs will follow
the government’s focus on
curbing rampant pollution in
the major cities and to cut oil
imports. India is the world’s
third-largest oil importer and
home to some of the world’s
most polluted cities.
According to the Survey,
road transport contributes
around 90% of the total emis-
sions in the transport sector in
India. Given the large depend-
ence on oil imports, it is imper-
ative to shift the focus to alter-
native fuels to support mobility
in a sustainable manner.
“Appropriate policy meas-
ures are needed to lower the
overall lifetime ownership
costs of EVs and make them an
attractive alternative to con-
The market share of electric cars is around 2% in China, while the share in India is a meagre 0.06%.
ventional vehicles for all con-
sumers” the Survey noted.
The Union government has
already sanctioned ₹10,000
crore to incentivize EV manu-
facturing through the second
phase of the Faster Adoption
and Manufacturing of Electric
Vehicles (FAME) scheme.
In the Economic Survey as
well, the NDA government has
underscored its intention to
of the key factors behind the the Survey said. 54,800 in 2018, and electrifica-
marginal sales of EVs in India. In May, the NITI Aayog and tion of two-wheelers and buses
The Survey also highlights some other ministries started has picked up pace in recent
the need to set up charging working on a proposal to ban years,” the Survey added.
infrastructure on two-wheelers One of the biggest hurdles
roads and high- The Survey with less than for adoption of electric mobil-
ways across the highlights the 150cc internal ity has also been the high cost of
length and need to set up combustion lithium-ion batteries and sour-
breadth of the charging infra on engines, and cing of lithium and cobalt.
country, saying three-wheelers by Citing the example of China,
roads and
this would help 2025 and 2023, the Survey said India needs to
drive sales of EVs. highways across respectively. The invest in lithium-ion battery
The market share the country auto industry has technology to rein in the cost of
of such vehicles been given two to electric vehicles. “Since the
usually increases four weeks to battery is the heart of any EV,
with the improved availability come up with a plan for a transi- development of appropriate
of charging infrastructure. tion. battery technologies that can
“Another major impediment “The market share of electric function efficiently in the high
is that of the time taken for cars is around 2% in China temperature conditions in
completely charging EVs, com- while it is around 39% in Nor- India need to be given utmost
pared to conventional vehicles. way, whereas the Indian mar- importance,” the Survey noted.

5 th
India’s rank in overall renewable power
installed capacity. India stands fourth in wind
power and fifth in solar power globally as it
undertakes green energy expansion plans.
To achieve the objective of
becoming a $5 trillion economy
by 2025, India needs to sustain a
real GDP growth rate of 8%.
PRALHAD JOSHI
Union parliamentary affairs minister
The Survey postulates centrality
of investment as a “key driver”
that catalyses the economy into
a self-sustaining virtuous cycle.
HIMANTA BISWA SARMA
BJP leader and Assam cabinet minister
India being the fastest growing
major economy in 2018-19, the
Survey is a blueprint for fulfilling
vision of 5 trillion economy.
ANURAG THAKUR
Minister of state for finance
We welcome the Economic
Survey by the new govt. It sees
MSMEs as source of innovation,
growth and job creation.
NIRANJAN HIRANANDANI
CMD of Hiranandani Group
 POLITICS FRIDAY, 5 JULY 2019
NEW DELHI 11
TOWARDS A

$5 TRILLION ECONOMY
FARM FOCUS CONSTRUCTION OF 9,829 10,824
NATIONAL HIGHWAYS 8,231

T he government’s National Mission for Sustainable Agriculture (NMSA) aims to make agriculture more productive,
sustainable, remunerative and climate resilient by promoting location-specific integrated fanning systems. It also aims to
conserve natural resources through soil and moisture conservation measures. To this end, the government has been
(IN KM)
4,410
6,061

promoting organic farming through schemes such as Paramparagat Krishi Vikas Yojana and Rashtriya Krishi Vikas Yojana. SOURCE: ECONOMIC SURVEY 2014-15 2015-16 2016-17 2017-18 2018-19

PRADEEP GAUR/MINT

REFORMS IN JUDICIARY CAN HELP

IMPROVE THE EASE OF DOING BIZ
Increasing number of working days and setting up an administrative body may improve productivity, says Survey
Prathma Sharma
prathma.s@livemint.com The Survey pointed out that it is important to consider privacy
NEW DELHI implications and inherent fairness of data that is used.

I Govt needs to leverage

ncreasing the number of working days in
courts and establishing of the Indian
Courts and Tribunal Services (ICTS) would
help enhance productivity in the judiciary,
according to the Economic Survey, 2019.
The Survey, however, cautions that increas-
data as public good to
ing the number of working days may improve
the productivity of the Supreme Court and of
some high courts, but is unlikely to signifi-
boost welfare of poor
cantly impact lower courts.
“The Supreme Court’s official calendar for
2019 suggests that it would close for 49 days for Shreya Nandi Census data; transactions and
summer vacations, 14 days for winter break, shreya.n@livemint.com institutional data, containing
and a further 18 days for Holi, Diwali and Duss- NEW DELHI information such as Unified
ehra,” says the Economic Survey. Payments Interface (UPI)

O
After accounting for weekends and public ne of the biggest fears remittances via BHIM app; and
holidays, this would leave 190 working days for over the unique iden- public hospital data of
the Supreme Court, it says. tification scheme, patients.
In contrast, the average number of working Aadhaar, concerned data pri- Such data is generally col-
days for high courts and subordinate courts are vacy. That debate now looks lected by various government
232 and 244 respectively, it points out. set to continue, with the Eco- departments, depending on
The Survey, however, points out that there nomic Survey 2019 urging the the subject. Therefore, the
is a great deal of variation between states, and government to use its rich Survey suggests merging such
many courts make up for vacations by working repository of data as “public data sets for the welfare of citi-
on Saturdays, and adds that “central govern- good” for the welfare of the cit- zens.
ment offices will be open for 244 working days izens, especially the poor. “Use of data for public good
in 2019”. “Data is generated by the is expected to be one of the
The ICTS, the Economic Survey says, would people, of the people and cornerstones for new forms of
focus on the administrative aspects of the legal should be used for the people. public-private partnerships.
system and technology deployment. The As a public good, data can be With deregulation of most sec-
major role to be played by ICTS would be to democratized and put to the tors in the economy, signifi-
provide administrative support functions The backlog in Supreme Court can be cleared in five years at full sanctioned strength with an efficiency gain of 18%, says the Survey. PRADEEP GAUR/MINT best possible use. While this is cant transaction-level data is
needed by the judiciary and identify process an excellent start, the enor- also generated by private play-
inefficiencies and advise the judiciary on legal Bankruptcy Code and the adoption of the working strength, it would take an efficiency ing to the Survey. mous benefits that can be ers in sectors such as mobility
reforms. goods and services tax have had a major impact gain of 58%. “A case clearance rate of 100% (zero accu- reaped from treating data as a (cab apps), banking and insur-
The specialized service mentioned in the on improving the ease of doing business in With full sanctioned strength, high courts mulation) can be achieved with the addition of public good imply that gov- ance, health, etc.,” said Arin-
Survey will help implement process re-engi- India and presented evidence that the backlog would need only 4.3% increase in efficiency to merely 2,279 judges in the lower courts and 93 ernment must redouble its dam Guha, partner, Deloitte
neering and create a system to improve the of cases that weighs down the judiciary, eco- clear the backlog though, given the high in high courts even without efficiency gains,” efforts in this direction,” the India.
administrative functions of the court. nomic tribunals and the tax department, con- vacancy rates; the required rate at current said the report. survey prepared by chief eco- The Survey also said that
The suggestions have been made against the strains economic growth. working strength is 68%. The corresponding One major effort is the eCourts Mission nomic adviser (CEA) Krishna- since data for social welfare
backdrop of the huge number of pend- numbers for the Supreme Court are 18% Mode Project “that is being rolled out in phases murthy Subramanian said. may not be generated by the
ing cases in the courts as delays in con- and 31%, respectively. by the ministry of law and justice”, says the The Survey, however, private sector in optimal quan-
tract enforcement and disposal resolu- It’s not about filling vacancies. The report underlines that Uttar Pra- Survey. pointed out that it is important tity, the government needs to
tion is “the single biggest hurdle” to the Lawyers must be brought under desh, Bihar, Odisha and West Bengal “The digitalization of cases is now allowing to consider the “privacy impli- view data as a public good and
ease of doing business in India and put- the purview of social security to require special attention. Bihar, Odisha stakeholders to keep track of individual cases cations and inherent fairness make the necessary invest-
ting the country on a high growth path. and West Bengal have higher average and their evolving status. It is not possible yet of data” that is used. It empha- ments.
The number of cases pending in bring holistic changes in judiciary. disposal time in district and subordi- to statistically measure the efficiency gains sized the fact that privacy of “Incentivizing the private
courts have been increasing, says the PRAKHAR GANGULY nate courts than the national average from this effort, but it is certainly a big step for- intimate or confidential data is sector to share this data with
report authored by Krishnamurthy V. Assistant professor, NALSAR University of Law for both civil and criminal cases, ward,” the Survey says. different from public data and the government through suit-
Subramanian, chief economic adviser according to the Survey, while Punjab India continues to lag on the indicator for the processing of any such able policy incentives can pro-
to the finance ministry. As many as 87.5% of the The 2019 Survey analyses the requirement and Delhi have the lowest average disposal enforcing contracts, climbing only one rank information will be in line with vide rich insights for futuristic
pending cases are in the district and subordi- of additional judges and efficiency gains across time. These trends are consistent with the dis- from 164 to 163 in the latest Doing Business the Personal Data Protection policy formulation. Similarly,
nate courts, it points out. the various levels of courts to achieve 100% tribution of average pendency age across report of 2018, according to the Economic Sur- Bill that is awaiting Parlia- using this data to kick-start the
The Economic Survey focuses on disposal clearance rate and eliminate pendency in the states. States in eastern India perform poorly vey. “In spite of a number of actions to expedite ment’s nod. innovation and startup ecosys-
time, pendency time, case types and case clear- next five years. though Gujarat also has higher disposal time, and improve the contract enforcement regime, The government collects tem in the country can be a
ance rate. It points out that the Economic Sur- The backlog in lower courts can be cleared it says. economic activity is being affected by the long four types of data—adminis- win-win for startups as well as
vey 2018 had highlighted how measures such in five years at full sanctioned strength with an The problems of pendency of cases and low shadow of delays and pendency across the trative data pertaining to birth, the Union government,” Guha
as the introduction of the Insolvency and efficiency gain of 24.5%, it says. At current efficiency are “not insurmountable”, accord- legal landscape,” it added. marriage, pension and death; added.

Private sector infra investment is key to achieving a high growth trajectory

Shreya Nandi lic sector. Along with physical smaller towns and cities. Besides, less-than-expected of public-private partnerships
shreya.n@livemint.com infrastructure, provision of The government also aimed traffic growth increases pro- in addressing financing gaps in
NEW DELHI social infrastructure is equally at electrifying 100% of its jects’ riskiness, resulting in the infrastructure sector.
important as these two would broad gauge network, to stalled projects because of lack While it refers to the need for

P
rivate investment into
building a robust physi-
cal and social infrastruc-
ture is key to putting India in a
high growth trajectory that
will make it a $5 trillion econ-
omy by 2024-2025.
The finance ministry’s Eco-
nomic Survey 2019, which
captures key economic devel-
opments and also projects
medium term objectives, said
that private sector participa-
tion in the infrastructure space
is crucial as funding cannot
depend on public investment
alone.
“The real challenge lies in
bringing adequate private
investment across the country
with the collaboration of pub-
determine where India will be
placed in the world by 2030,”
said the survey prepared by
the chief economic adviser
(CEA) Krishnamurthy Subra-
manian.
According to the survey,
India needs to spend 7-8% of
its gross domestic product
(GDP) on infrastructure every
year, which translates into an
annual infrastructure invest-
ment of $200 billion. How-
ever, the country has been able
to spend only about half the
amount so far.
The document calls for
higher flow of private capital
into infrastructure as the gov-
ernment can only spend up to
a certain limit because of fiscal
Over the last few years, the government has increased the pace of road construction.
constraints.
The National Democratic
Alliance (NDA) in its first term
consistently focused on infra-
structure for improving con-
nectivity by allocating massive
expenditure for building
roads, smart cities, launching
REUTERS
schemes such as Saubhagya
aiming at 100% electrification
of households, housing for all,
and building airports in
reduce dependence on of funds, the Economic Survey institutional mechanisms to
imported diesel. Indian Rail- said. resolve pending disputes in a
ways has already identified Over the last few years, the time-bound manner as one of
38,000 route kilometre government has increased the the key areas to focus on, some
(RKM) for electri- pace of road con- other measures such as further
fication by 2021 The Survey calls struction by deepening of the existing cor-
from 35,488RKM for higher flow of introducing sev- porate bond market through
in April 2019. private capital in eral policies to suitable policies and incen-
The sector is the infrastructure deal with these tives, leveraging institutions
grappling with
space as the govt challenges. These
like NIIF (National Investment
myriad challen- include fresh and Infrastructure Fund) to
ges pertaining to can only spend up project financing promote sector-specific
financing large to a certain limit models that financing platforms which
projects, land involve govern- aggregate projects at different
acquisition and ment and private levels of maturity/risks, and
environment clearances, and investment, inter-ministerial expanding credit guarantee
high costs incurred because of coordination, and streamlin- facilities through partnerships
delays in project implementa- ing the land acquisition proc- with multilateral agencies
tion, despite the government’s ess. would also be required,” Arin-
attempt to build a robust road “The Economic Survey 2019 dam Guha, partner at Deloitte
network in the country. acknowledges the importance India said.

100 %
The clearance rate that can be achieved by
merely filing out the vacancies in courts,
according to the Survey. Reforms must focus
on district and subordinate courts, it said.
Privacy is a fundamental right.
There is nothing ‘elite’ about it (as
noted in Economic Survey 2019).
India needs a privacy law.
MILIND DEORA
Congress leader
The Survey depicts upbeat data
for railways. It’s an attestation to
our efforts to make railways the
growth engine of New India.
PIYUSH GOYAL
Minister for railways, commerce and industry
If we ramp up exports and give
attention to what the Survey
calls “new firms”, those would
help in ramping up investment.
RAJIV KUMAR
Vice chairman, NITI Aayog
The Economic Survey is full of
bombastic claims and grandiose
declarations without any basis in
facts.
SITARAM YECHURY
CPM general secretary
12 FRIDAY, 5 JULY 2019
NEW DELHI

REPORTAGE | TALKING POINTS | IDEAS | INSIGHT | THE BOTTOMLINE

INDIA NEEDS A NEW

DEAL FOR RURAL INDIA
The Modi government has to urgently bridge the urban-rural divide. Here’s where it should begin

Poverty in rural India is rampant,

with the average annual earnings
of a small and marginal farmer
household at ₹79,779 in 2015-16. PTI

Kiran Mazumdar-Shaw The Narendra Modi-led government capacities. In this day and age, using micro-entrepreneurs and connect these genetically modified (GM) technology.
mint
feedback@livemint.com has its task cut out. It will need to focus on labour to dig wells or lay roads is really not SHORT rural entrepreneurs to national and inter- Indian farmers who opted for Bt cotton,
agri-technologies that can boost agricul- a very smart way of using human capital. STORY national markets. Greater access to tech- which is the only GM crop allowed for

A
s our economy grows—some- tural productivity, create value-added Unless human capital is empowered with nology has already led to the emergence of commercial cultivation in the country,
times rapidly and sometimes farm products and tap “farm-to-fork knowledge and skills, we will waste a huge social enterprise startups that are coming benefited from higher yields and reduced
hesitantly—the transforma- opportunities” to ensure resource. This is why the WHAT up with apps to help improve the lives of pesticides use. Over 90% of the country’s
tion is evident to all, whether better realization for MGNREGA needs a rural folk. A greater push to these startups cotton growing areas is today under Bt
or not they are included in farmers. It will also need reboot. Instead of look- Misplaced economic policies can reap rich dividends. Cotton, and India has emerged as the larg-
India’s development. Fuelled by acceler- to create millions of ing at the rural work- have excluded a majority of est producer and second largest exporter
ating urbanization and widespread access micro-entrepreneurs IDEAS FOR force as labourers, our rural society from partaking in USING BIOTECH IN AGRICULTURE of cotton in the world. According a recent
India’s journey of development,
to information, aspirations are evident and thousands of eco-
across all sections of society. When these nomic clusters in rural
INDIA policymakers should
approach them as a key resulting in a sense of deprivation A lthough agriculture contributes to article by well-known agricultural econo-
about 17% of India’s gross domestic mist, Ashok Gulati, India gained about $67
are not realized, it stokes a sense of resent- India, besides investing human resource. and dissatisfaction. product (GDP), its significance to the peo- billion in foreign exchange from extra
ment among the disadvantaged. In this in rural roads, rural electricity, irrigation ple of India cannot be overemphasized. In exports of cotton and cotton yarn, and sav-
highly disruptive phase of India’s history, networks and national cold chain grids. NEED FOR ENTREPRENEURSHIP addition to feeding the country, agricul- ings in imports, over FY03-FY17. Impor-
AND
we must therefore ensure that the benefits
of economic growth reach every single cit- LOAN WAIVERS NEED A RETHINK T o re-energise the rural economy, the
Modi government has been trying to
Jump-starting the economic
ture has nearly half of our 1.3 billion-plus tantly, incomes of cotton farmers doubled
population depending on it for their liveli- due to adoption of Bt Cotton.
izen of India. If not, if inequity reigns and
hopes die, our efforts to create a prosper-
ous India will not bear fruit.
I ndia urgently needs to rethink its cur- bring in some policy reforms like e-mar-
rent prescriptions for alleviating rural kets, farmer producer organizations
distress, most of which are in the form of (FPOs) and the Model Contract Farming
engine of rural India is imperative
for long-term growth as that will
hood. The bad news is agricultural growth The case of Bt Cotton has amply dem-
is slowing. Between fiscal 2014 and 2019, onstrated that the responsible introduc-
agri-GDP grew at 2.9% per year compared tion of GM crops can be one of the most
Some of the misplaced economic poli- either doles or loan waivers. These have Act, 2018. As Indian farmers have the have a multiplier effect on with a 3.7% per annum growth between potent ways of increasing productivity of
cies in the recent past have excluded a mostly failed to reduce poverty and smallest landholding on the planet, they investment, consumption and fiscal 2005 and 2014. crops in this country. Yet, fearmongering
majority of rural society from partaking in ensure income security for a majority of lack individual bargaining capacity in the government expenditure. At the same time, climate change by activists over the bio-safety and envi-
India’s journey of development, resulting Indians employed in farming. There are open market for their small produce. In threatens India’s crop production. While ronmental safety of GM crops has led to a
in a sense of deprivation and dissatisfac- numerous reports of farmer suicides from such a scenario, the creation of FPOs can the extreme rainfall events have become hostile policy regime towards this tech-
tion among a large percentage of people in across the country even as per capita give them a competitive edge because HOW frequent and more variable, the severity nology. Apart from GM crops, agricultural
the Indian villages. income of farmers has grown marginally. they can pool in their produce, invest in and frequency of droughts has also biotechnology is leveraging molecular
Poverty in rural India is rampant with The Accidental Death and Suicide in India cold storage facilities and better negotiate To kick-start the rural economy, increased since 1970s. The application of markers in crop breeding for the selective
the average annual earning of a small and report for 2015 showed that every day at with large buyers. we must formulate policies that biotechnology can optimize the use of propagation of genes that improve yields
marginal farmer household at ₹79,779 in least 34 farmers committed suicide in At the same time, I believe FPOs need to focus on helping people emerge available resources without placing addi- and resist disease. Micropropagation is
2015-16, according to the Committee on India (12,602 suicides in the year), mainly go beyond just being “farming coopera- from an existence of perpetual tional demands on land or water to boost another area where biotechnology is help-
Doubling of Farmers’ Income. The dispar- because of bankruptcy or indebtedness. tives” and transform themselves into disadvantage through incentives, yields, which is what India needs. These ing produce pathogen-free plants and
ity in per capita rural and urban income We should change the way we are look- thriving entrepreneurship clusters. The not hand-outs. solutions, which can be easily scaled address soil imbalance issues.
has remained persistently high, with an ing at using welfare funding. Welfare FPO model should be expanded with a across the country, can improve the qual- Unfortunately, biotechnology itself
average urban worker earning over eight funding does not cure or address the root large number of incentives. The govern- ity of the produce with disease-free and faces several challenges. While the gov-
times an average agricultural worker, cause of poverty, it only treats the symp- ment needs to step in to create a few system that leads to the creation of a nutritionally enhanced varieties of crops. ernment understands the importance of
according to NITI Aayog discussion paper toms. The root cause of poverty is about model FPOs in the country. An official vibrant rural economy. If we can create Biotechnology can also generate eco- food security, it needs to translate this
Changing Structure of Rural Economy of lack of skills and economic opportunity. from the agricultural ministry can play the villages that can directly sell produce to nomic opportunity, investment and understanding into action through the
India, Implications for Employment and So welfare funding should be directed at role of an enabler and facilitator in these global markets then we will see the ripple employment in the agriculture sector effective use of biotech. Instead of putting
Growth. removing these roadblocks in the path of model FPOs and ensure they get access to effects of a micro-entrepreneurial econ- through the development of new varieties up regulatory roadblocks, it must pave the
The widening urban-rural divide is also sustainable rural development. tax and other incentives. A prudent plan omy flowing through rural India. of crops, new uses for crop residues and way for agricultural biotechnology.
evident in the inequalities in consump- Let us take the Mahatma Gandhi for FPOs will encourage agricultural waste, as well as, supporting the develop- Even as we move on the policy front, we
tion, quality of life, and National Rural Employ- entrepreneurs to go ahead and emulate MAKING RURAL FOLK TECH SAVVY ment of new markets for must also bridge the
availability of physical

ture. To ensure inclusive

ment G u a r a nt ee the success of the famous milk coopera-
and social infrastruc- Welfare funding does not cure (MGNREG) programme, tive brand Amul.
or address the root cause of which provides at least FPOs can be a great model for value-
W hile smart government policies,
financial inclusion initiatives and
investments in infrastructure can help,
farm produce. It offers
huge potential to drive
improvements in agri-
Fear-mongering by activists
over the bio-safety and
huge knowledge gap in
Indian agriculture
between farmers on one
economic growth, the 100 days of guaranteed added agriculture. For example, an FPO of greater use of technology can fire the cultural productivity side and crop scientists
government needs to poverty. It only treats the wage employment each farmers who produce ragi or finger millet, entrepreneurial spirit and spur innova- and profitability, thus environmental safety of on the other. Farmers
urgently focus on trans- symptoms. The root cause of fiscal year to every a popular staple in the diet of a large num- tion in rural India. Technology can also providing opportunities GM crops has led to a hostile should be trained on
forming the agrarian household whose adult ber of people in Karnataka, can start creat- help farmers access high-quality inputs, to ensure economic micro-irrigation, micro-
economy to pull the poverty is about lack of skills members volunteer to ing value-added products from their crop. crop health and yield data and crucial well-being of the farmer policy regime towards this propagation, latest farm-
maximum number of do unskilled manual In fact, with the Karnataka government weather related information. Adoption of along with food security ing technology, smart
people out of subsist- and economic opportunity work. Does the pro- promoting ragi as a new superfood, com- advanced agriculture technology through for the nation. technology use of fertilisers, better
ence farming and give gramme ensure sustain- parable with quinoa, there is a great machines and equipment that use data The Indian govern- understanding of crop
them a much more remunerative role. able livelihood for the remaining 265 days opportunity for an FPO to look at making analytics, Internet of Things and robotics ment has set up several centres of plant rotation etc.
With two-thirds of India’s billion-plus of the year? Are the wages enough to lift value-added products like ragi health can help optimize inputs and enhance molecular biology and crop biotechnol- To conclude, to kick-start the rural
people living in villages, jump-starting the them out of poverty? Is the programme drinks, multigrain noodles, ragi biscuits, yields. Moreover, using technology and ogy. Moreover, numerous agricultural economy, we must formulate policies that
economic engine of rural India will have a helping upskill these rural workers? The ragi vermicelli etc. An entire micro-entre- data science can help build more efficient universities in the country have started focus on helping people emerge from an
multiplier effect on investment, consump- answer to all these questions is no. preneurship cluster can come up to sup- supply chains that connect retail grocery their own biotechnology programmes existence of perpetual disadvantage
tion, government expenditure and Instead of labour-oriented job creation, ply to a ready urban market, thus ensuring stores with food processors and FPOs. with financial support from local govern- through incentives not hand-outs. A
exports. The potential of rural India can be the MGNREGA should push knowledge- a long-term, sustainable source of income Social media platforms can help con- ments, and national and international bridging of the urban-rural divide is
gauged by the fact that agricultural start- led job creation, which is to say the pro- for the farmers. nect farmers to the larger economy. If funding agencies. Agri-biotechnology is imperative for long-term sustainable
ups have raised nearly $130 million in gramme should encourage farmers to In fact, these FPOs can tie up with busi- WhatsApp messages can reach every sin- being applied across poultry and dairy growth of the economy.
about 70 deals in the past five years to learn about technology, and it should ness schools to build the knowhow for gle voter in India, the platform can be used farming, fisheries, floriculture, horticul- Kiran Mazumdar-Shaw is chairperson
2018, according to a news report. apply technology to increase their earning developing a robust entrepreneurial eco- to educate farmers, transform them into ture, the food processing industry, and and managing director of Biocon Ltd.

TECHCETERA
PROJECT LOON TO BEGIN
COMMERCIAL TRIAL
Google will soon start
commercial testing of its
wireless internet service,
called Project Loon, which
uses high-altitude balloons to
beam Internet connectivity
down to remote locations
Startups leverage technology
to solve nation’s water crisis
Aquapanel, NKD Pod+ and water ATMs maybe the answer to country’s drinking water woes
Abhijit Ahaskar
abhijit.a@livemint.com
NEW DELHI
U
ravu Labs, a Bengaluru-
based startup, wants to
address India’s water crisis
in its own limited way. It
has developed a solar ther-
mal-based device called Aquapanel to
produce drinking water from air. The
device absorbs water vapour at night as
the humidity is higher in many places.
During the day, the solar collector
heats up the device to around
80-100°C, releasing the saturated
water vapour back. The vapours are
then passed through an air-cooled con-
denser and transformed into liquid.
The device filters out pollutant, pol-
len or dust from the start and uses ultra-
violet (UV) light to ensure there is no
bacterial formation in the device.
“Since it is powered by solar energy, we
are limited by how much energy we can
get per square metre of the device. For
every square metre, the device can gen-
erate 4 to 5 litres of water,” says Swapnil
Srivastav, CEO of Uravu Labs.
Israel-based tech startup Watergen
has a device that works on the same
principle but uses electricity instead of
solar energy for power. It is a water gen-
erator called Gen-350 that can produce
900 litres of water from the air by puri-
fying air moisture every day. To keep
water clean it uses a multi-layer filtra-
tion cascade and has an in-built treat-
ment facility that continually circulates
water to keep it fresh. Gen 350 is
reportedly being used in over 3,400
homes and schools in South Africa.
Aquapanel and Gen-350 are simply
cases in point. Startups are digging into
technology and are leveraging them to
solve the drinking water problem.
Clean Water AI, for instance, can
save people from falling sick due to
drinking contaminated water. Testing
and validating a water source as clean is
expensive and elaborate.
Developer and innovator, Peter Ma’s
Clean Water AI system uses machine
learning (ML) and pattern recognition
to identify bacteria. The device
includes a digital microscope con-
nected to a laptop or PC with an Intel
Movidius Neural Compute Stick
attached to perform water testing in
real time. Ma used Intel AI DevCloud to
train the AI model. Building the entire
system cost him less than $500 and the
testing itself takes a few minutes. Using
Clean Water AI, Ma was able to identify
the shape, colour, density, and edges of
two common bacteria forms Escher-
ichia coli and Vibrio cholera.
“I built Clean Water AI specifically
for World Virtual GovHack, targeting
the Water Safety and Food Security
challenge. We are currently in the pro-
totyping stage and working on the next
Best phones for basic users
Indians are buying expensive smartphones, according to some reports, but not
all of us really need one. If you really want a basic smartphone, say for your
parents, here’s what you could consider:
XIAOMI REDMI 7A
Starts at ₹5,799
This one has a 5.5-inch
screen, runs on MIUI 10
and the Qualcomm
Snapdragon 439 chipset.
It has 2GB of RAM and
16GB on-board storage.
It’s Xiaomi’s newest
budget smartphone in
India.
SAMSUNG GALAXY M10
₹6,990
Another smartphone
with thin bezels and the
popular teardrop design,
this one offers a 6.22-inch
display with Samsung’s
new custom UI. It runs on
the Exynos 7870 chipset
and has 2GB RAM. It has a
glossy plastic back finish
and is also sold in blue.
Peter Ma’s Clean Water AI system uses machine learning and pattern recognition
to identify bacteria in contaminated water.
iteration so it can be in one single Inter-
net of Things device,” said Ma on an
Intel developer blog. The AI device for
water safety typically requires very lit-
tle maintenance, because it will be
based on optical readings, rather than
chemical-based ones. This will save
cost, notes Ma.
Many urban homes rely on reverse
osmosis (RO) or UV water purifiers.
What many of them do not have is a sys-
REALME C2
₹5,999
You get a bigger 6.1-inch
screen with thin bezels
and a teardrop screen,
apart from a unique
diamond-cut design on
the back. It is driven by
the Helio P22 chipset and
has 2GB of RAM and a
4,000mAh battery.
HONOR 8C
₹8,999
On paper, the most
powerful of the lot, the
Honor 8C runs on
Qualcomm’s mid range
632 octa-core chipset,
and is paired with 4GB
RAM and 32GB storage.
It has a dual tone matte
finish with eye-catching
colour options.
FRIDAY, 5 JULY 2019
NEW DELHI 13
TECH @YOU
NVIDIA UPS THE GAME WITH MacBook Pro may Apple’s iOS 13 beta brings a cool new
RTX SUPER GRAPHICS
Nvidia has rolled out a new
version of GeForce RTX
get a new keyboard
Apple is reportedly switching
from the controversial
2.8 million
Approximate number of jobs IoT and
feature to FaceTime
iOS 13 beta’s new FaceTime
attention correction feature
GPUs, offering slight butterfly keyboard used in artificial intelligence applications will uses AR to make it look like
speed improvements at the MacBooks since 2015, to a generate in rural India in the next 10
years, as per Broadband India Forum you are looking at a camera,
same price point as the current new glass fibre-based scissor
even when you are not
line-up switch design
Land Rover Discovery Sport
gets off-roading features right
Prasid Banerjee
prasid.b@livemint.com
comparison to many luxury cars.
Depending on which model you’re buy-
NEW DELHI ing, the car has a 8- or 10-inch touchscreen.
This gives you access to the infotainment
W
hen it comes to sport utility vehi- system, which has Bluetooth and Wi-Fi hot-
cles, or SUVs, high-end buyers in spot connectivity. You can connect your
ISTOCKPHOTO the country typically have the phone to this to take calls, play music etc.,
Land Rover brand on their mind. But what but it does not support Apple Carplay or
the Land Rover is really known for perhaps, Android Auto.
are the off-roading capabilities that it brings Instead, the Discovery Sport has its own
to the table. And that’s exactly what the Dis- in-house solution called In Control, which
covery Sport is about, though it has other allows somewhat better useability while driv-
tech features too. ing. With this, you can access versions of apps
The car has a Terrain Response system, that are meant specifically for vehicles. Some
which allows it to change the driving of the partners here are Zomato, Spotify and
response based on the driving conditions. NDTV, but one wonders why Land Rover
So, the car can adjust the vehicle’s differen- would leave out Android Auto or Apple Car-
tials, transmission, engine and chassis to play support when those would give wider
improve the drive and make off- app support and easier access.
roading easier and more com- The touchscreen system is
fortable. It includes terrain somewhat slow, which can be
response systems for grass, PROS distracting if you try to use it
snow, mud, gravel and sand.  Hill Descent Control is while driving.
 That said, it is
The Land Rover Discov- quite dependable in no way a major impedi-
ery Sport also has a Hill  Park assist allows easier ment. The Discovery Sport
Descent Control (HDC) parking in tight spots also has steering controls
system. Off-roading enthu-  Terrain Response for changing
 music, voice
siasts may already know system allows easier support, taking calls, etc., but
about this, but it’s interesting off-roading it doesn’t get the Range Rover
technology nevertheless. HDC Velar’s touch system here. That
allows the driver to maintain con- makes sense, since the Velar is the
stant speeds when on inclines or company’s more premium vehicle.
hilly terrains. It’s essentially a Lastly, you also get Meridian
version of cruise control for speaker systems in the top
such terrain (the Discovery CONS variants of the Discovery
  No Android Auto or
Sport also has regular Sport. This could vary
cruise control for driving Apple Carplay support between the 380 watt 11
  In Control apps have to
on highways). With this, speaker system or the 825
the driver sets a speed in be bought separately watt 17 speaker system,

advance and can let go of  Speakers are only depending on the model
the accelerator thereon. The adequate you buy, but both are ade-
vehicle gauges how steep the quate for listening to music,
address this through water ATMs. Pow- incline is, and adjusts the speed radio etc. It doesn’t hold a candle
ered by solar energy, the Swajal water accordingly when you’re descending. to the Volvo V90 Cross Country’s
ATMs use IoT sensors to remotely In the meanwhile, the driver can focus on in-car speaker system but it’s definitely not
monitor the quality of the water and the steering only. something that would disappoint non-audi-
performance of the machine. Swajal Atop steep inclines, this feels somewhat ophiles. There are 80W and 190W Land
claims it uses machine learning to run similar to being on a roller-coaster, before it Rover audio systems in lower variants of the
predictive maintenance algorithms to starts descent. The Discovery Sport ensures Discovery Sport, which we haven’t tried.
predict system failures before it actu- that the driver doesn’t have to suddenly hit In essence, the Discovery Sport is a car
ally happens. the brakes and endure jerks. While climb- that’s focused on those wanting to buy an
Another more portable alternative to ing, the car also has a Hill Start Assist feature. SUV, or interested in off-roading. Its off-
water purifiers are water bottles like This, as in many other cars, keeps the vehicle roading capabilities are great, and it packs
NKD Pod+ which have an in-built puri- from rolling downwards when you’re almost in interesting technology for the same. It’s
fier system, which can cleanse up to stationary when queuing up a flyover. not the most tech-driven car as a whole, but
99% of bacteria, heavy metals and While that covers the Discovery Sport’s it’s unlikely that the target market would
chemicals from water in any form to off-roading features, the car has a little more care either.
make it drinkable again. It also uses technology to offer for the regular
super charging technology to make the tech enthusiasts, though
water more alkaline and richer in anti- these may easily pale in
oxidants. Developed by a UK-based
firm NKD, the Pod+ can hold 585ml of Price starts at
water at one time. It has a replaceable ₹44.68 lakh
filter which costs ₹1,198 and has a life
cycle of 300 refills. The bottle is availa-
ble in India at ₹2,998.
While conserving water and clean-
ing water bodies will help in the long
tem that will alert users when the water run, devices like Aqua panel, NKD
quality begins to deteriorate. Bengalu- Pod+ and Oceo Water purifiers can
ru-based company Oceo Water has an help tackle India’s current drinking
IOT-enabled water purifier that keeps water shortage. According to a
track of water quality in real time from 2018 NITI Aayog report, India’s
the back-end and sends alerts when the water crisis will only worsen, as
device requires maintenance. 40% of the population will not
Then, there is the issue of availability have access to clean drinking
of clean drinking water in public places water by 2030. Startups such as
like railway stations, metros or malls. these will provide the much-
Gurugram-based Swajal is trying to needed succour.
Best game deals on Steam, PlayStation Store and Amazon
Abhijit Ahaskar
abhijit.a@livemint.com
NEW DELHI
A
t the recently concluded Elec-
tronic Entertainment Expo (E3),
gamers had a sneak peek into
some of the hottest games that are
headed their way.
However, purchasing exciting new
games at the time of its launch can be a
very costly affair, as most popular AAA
titles cost ₹3,000-5,000. However, you
can get the same games at a discounted
price in some of the ongoing summer
sales on Steam, PlayStation Store and
Amazon.in. Here are the most sought-
after games under three distinct gaming
genres.
Action
Among the latest action games, Ubi- tlefield 5 is retailing on Amazon.in at Station store. Konami’s PES 2019 is on moves, there is a lot on offer. For
soft’s open world game Far Cry New ₹2,221. It was launched at ₹4,699. One of offer on Steam at ₹1,201 after a 50% dis- instance, 2K Games’ empire builder
Dawn is available on Steam at ₹1,244, the most popular action games is the lat- count. Big Ant’s Cricket 19 game for game Civilization VI: Gathering Storm, is
down from the original price of ₹2,249, est Shadow of the Tomb Raider game. Xbox and PS4 is available at ₹3,220 after retailing at ₹1,349 after a 25% discount.
while Warner Bros’ stealth-based shoot- Steam is offering a big discount on it, a 20% discount on Amazon.in. For bas- Sega’s football strategy game Football
ing game Hitman 2, which was earlier making it available for ₹1,399, instead of ketball fans planning on buying 2K Manager Touch 2019 is available on
priced at ₹1,349 is now available at ₹539. the original ₹3,499. Games’ NBA 2K19, this is the best time as Steam at ₹544, down from ₹1,600.
The top deals on PlayStation Store Sports its price has been slashed from ₹2,999 to There is a 75% discount on the award-
include Bethesda’s Rage 2, which is now Football fans can buy EA Sports’ FIFA ₹479 on Steam. winning strategy game XCOM 2 by 2K
selling at ₹2,749, down from ₹5,599. EA 19 and Madden NFL 19 bundle for ₹1,749, Strategy Games on Steam which has brought
Sports’ World War 2 shooting game Bat- sharply lower from ₹4,399, on the Play- For gamers who prefer to plot their down the price to ₹749.
 EXCLUSIVE FROM

14 FRIDAY, 5 JULY 2019

NEW DELHI

Govt’s focus is on boosting non-tax revenues,

which will help stabilize GST, says Subramanian
RAMESH PATHANIA/MINT
Shereen Bhan which is also enabling some of the benefits NBFCs and the way out?
CNBC-TV18 of synergies to be realized. All the State I have expressed my view on this clearly
India cannot Bank of India (SBI) subsidiary banks have in an article that I had written in The Times

B
anks will have to lend at a become a $5 trillion been consolidated, and the Bank of Bar- of India about a month or so back. We have
higher rate for the economy to oda (BoB) merger with Dena Bank and to be very careful to ensure that we do not
reach its growth target, the gov- economy without Vijaya Bank. So these are steps that have create a situation of private profits and
ernment’s chief economic private investment already been taken. socialized losses—the moral hazard that it
adviser Krishnamurthy Subra- taking off. And Together with that, when you keep in creates. There is a trade-off that we have to
manian said in an interview. The bottom- mind that insolvency and bankruptcy balance out. I would rather focus on some
ing out of the non-performing asset (NPA) that has been the code (IBC) is bringing about behavioural of the key changes that need to be done so
situation at public sector banks (PSBs) has Survey’s main focus. change and I understand that there will be that the NBFC sector is provided the nec-
already happened, he added, and the conversation on some of the anecdotes essary vibrancy.
insolvency and bankruptcy code (IBC) is Krishnamurthy but, as an academic, what I emphasize is One of the key things is the asset liabil-
bringing about behavioural change. Subramanian we should know policymaking is not ity mismatch that NBFCs have under-
Chief economic adviser
Edited excerpts from an interview: about anecdotes, it is about averages. taken; that is a key problem and that is
You acknowledged that a there is a On average, when we look at the IBC, it something that we have to monitor and
softening, moderation in growth is bringing about significant change, it is reduce incentives for such mismatches to
but at the same time there seems to bringing about behavioural change in the happen. To be more specific, if you look at
be pull and pressure on whether or way the credit happens, eventually it is the the commercial papers (CP); the ratings
not there is a requirement for some quality of credit that banks do that enables that CPs have, 95% of all ratings are just
sort of stimulus at this point in time. them to basically create the scope for fur- L1+ and so the information that is out there
You also said in your presentation ther lending. So that is something that is not distinguishing among all these cred-
that the economy is poised for a steps are going on. I think IBC will help in its, in fact if you look at the CP spread, that
take-off, in that scenario then, is improving this. CP spread actually correlates with the
there a need for a stimulus? One is the IBC but since you talked long-term rating of that entity. The point
Our main focus is on encouraging pri- about enhancing lending capacity, I am making is that by clubbing all these
vate investment because the vision of do you believe that there is a need long-, short-term credits together we have
India becoming a $5 trillion economy can- for a significant recapitalisation at created an incentive for the not so good
not be achieved without private invest- this point? ones to be pulling with the good ones.
ment taking off and the emphasis there- At this point in time, except for couple These are some of the structural aspects
fore has been on ensuring that we basi- of banks which are in prompt correction that we need to be focusing on.
cally think about all those obstacles that non-tax revenues and there is significant that the required provisions are made for About ₹90,000 crore plus? action (PCA), the rest of the banks have the Fresh investments is at a 15 year
inhibit private investment and we remove emphasis that the government is laying on the necessary expenditure. A glide path Should be possible...we do not necessa- necessary capital that is required. So, if low.... What is the assumption?
those obstacles so that the investment that going forward. does not mean that it has to be a linear rily insist on the 51% number, that leaves you leave out those banks, which may also What is the assumption in terms of
cycle, which is now showing some green Therefore I would anticipate that the glide path, you could achieve that glide ample scope then for disinvestment to happen if growth occurs and they are able private capex and investment?
shoots can pick up and that is the main projections we are making for the fiscal path with reasonable sensibility. happen. to come out and through possibly some We have shown the evidence for China
emphasis in the Survey. deficit will continue to follow that glide I don’t think we actually And don’t insist on 51% other measures, I think the other banks and the East Asian economies that as a
Something that you red- path towards achieving the need to be worried about INTERVIEW even as far as public sec- are in a reasonably good situation. For percentage of their GDP they invested in
flagged in the Survey is ‘A lot of our public fiscal deficit targets and so I the targets especially, as I tor banks are con- growth to happen it is important that the excess of 35%, starting about 35%. What is
the challenges you see sector enterprises do not anticipate any worries already said, the focus on non-tax reve- cerned? credit growth is at a higher critical to remember though
for the fisc as far as sit on significant on that front because the nues to support the stabilization process I don’t think I would want to get into rate. I think that is undenia- ‘At this point in is that we are showing that at
FY20 is concerned, you assets, which support from the non-tax of GST, should be able to achieve that. specifics on that. Basically, when we are ble. Some of it can come in time, except for the time when they were in
talk about the buoyancy revenues will actually take Because glide path, by definition, provides talking about disinvestment, we are talk- fact from the banks them- banks that are in development stage where we
can be mone-
on goods and service tax care of the stabilization of some flexibility. ing about the disinvestment in aggregate selves being able to do better prompt correc- are right now, they ended up
(GST) collection side, tized. Expect GST process. On non-tax revenues, the big hope —and so the comment I am making about lending using technological investing in excess of 30%
greater traction So you don’t expect even a tion action, the
the moderation of is on strategic disinvestment—this is in aggregate. improvements because they odd.
growth and provisions on the disinvest- minor deviation as far as was the stated intent of the govern- I get that but I am just specifically do have the cushion and as rest of the lenders So that is something that
for schemes like ment front.’ the fiscal deficit is con- ment in its first tenure as well; that asking you as far as PSBs are con- long as they are doing the have the neces- will be required. We have
PM-Kisan. If I were to cerned? didn’t get taken forward? Now cerned. lending in a prudent man- sary capital that is actually been able to hit those
look at the tax num- I don’t think we will actu- there is a lot of talk on a roadmap I don’t want to comment on that. ner, the provisioning will be required.’ rates earlier. Do remember
bers—direct tax has missed esti- ally be deviating, we will be following the being presented both for asset recy- In the survey you talk about how adequate for them to be able that some of the reduction in
mates by ₹75,000 crore in FY19, a glide path. Remember the focus is only on cling as well as for asset monetiza- the NPA situation has improved as to do those lending. investment that happened
23% required growth rate to meet the glide path...we will be sticking to it. tion, what are your thoughts on far as PSBs are concerned. In light I was having a conversation with was an overhang of what happened in the
the FY20 growth projected num- In light of what may be the recom- both? of that and the fact that the central vice chairman of the NITI Aayog previous 5 years and now that some of
bers. While GST missed estimates mendations of the 15th Finance Both of those are excellent ideas theme of the survey is to drive and in his personal view he believes those concerns have been taken care of
by ₹46,000 crore in FY19 and that Commission and the devolution because there is significant opportunity, investment, do you think growth that the government should step in, and if we keep in mind that there is a lot of
is despite a ₹1 trillion cut in the estimate, do you believe that 3% is a lot of our public sector enterprises sit on capital for PSBs is a requirement? perhaps by way of SPV. He sug- global liquidity that is floating around and
FY19 revised estimates (REs), so achievable? a lot of significant assets, which can be What is important to keep in mind is gested even troubled asset relief interest rates are quite benign as well, if we
given the tax situation, how wor- Remember that the target of 3% is what monetized. I will also mention that this that there has been significant improve- program (TARP)-like formula for are in a situation, we create the conditions
ried would you be about the fisc? we have to achieve in FY21 and when we government having come back with a sig- ment in the NPA situation. The bottoming the non-banking financial compa- for some of that to be utilized then invest-
While the stabilization on GST happens set a glide path we actually have a flexibil- nificant mandate, there may be greater of the NPA situation has already hap- nies (NBFC) crisis to be dealt with. ment can definitely happen.
there is definitely scope for increasing our ity of achieving that target by ensuring traction on the disinvestment as well. pened. There has been consolidation now, What is your view on the state of feedback@livemint.com

‘Cheap capital is key to high investment growth’ ‘India must boost infrastructure
Latha Venkatesh
CNBC-TV18
RAMESH PATHANIA/MINT

pointing out is not what any- reach 100% case clearance

body has ever managed to do. rate, and we discovered that
spending, continue to pare rates’
For the moment, how do the numbers are actually quite ANIRUDDHA CHOWDHURY/MINT

S
anjeev Sanyal, principal you break this logjam of small. If you had little less than Latha Venkatesh &
economic adviser, minis- falling savings? 2,300 judges in the lower Sonia Shenoy
try of finance, says sev- You need to bring down the courts and, maybe, 93 extra
eral measures will have to be cost of capital. Ironically judges in the high courts, we CNBC-TV18
taken to get the investment bringing down the cost of capi- can actually reach 100% clear-

cycle going. Edited excerpts
from an interview:
The key thrust of the eco-
nomic survey is that we
should be concentrating on
private investment as the
engine of growth. Are we to
assume therefore that fis-
cal discipline will not be
increased in the budgets?
This is a blueprint for a long-
term growth. If you look at
international experience, sus-
taining high growth rates in
the 8% range has only hap-
pened when investment rates
in the country have been very
high. If you take East Asian , for
example, the data is very clear,
you need an investment rate in
excess of 35% of the GDP. If
you want to sustain 8% type
growth rates, that requires a
whole host of policy changes,
which we have talked about,
but the main point that we are
making right upfront is that, it
is too difficult and complicated
to try and solve every little
problem in silos and hope that
growth happens.
In every single episode of
high growth, the high invest-
ment rate basically cuts
through the morass and drives
growth. So, it is investment
that drives demand, it is
investment that creates new
opportunities and brings in
new innovation, it creates jobs.
It is a virtuous cycle that drives
it. That is basically the case we
have made.
Of course, there are a whole
host of things that need to be
done to get this investment
cycle going, but rather than
focussing on a disparate bunch
of things, we have tried to
focus on what we need to do to
M
tal is good for increasing the ance rate. If you think about it ark Mobius, founding
savings rate, because it will as an investment, it is a small partner, Mobius Capi-
increase the investment rate, investment to do. More inter- tal Partners says it
and get growth going. estingly, we found that we can would be better to invest more
Second, we also have got a clear the entire backlog of 35 in infrastructure instead of
whole bunch of other reforms, million cases in 5 years by effi- recapitalizing state-run banks.
which we have talked about in ciency gains, which are actu- Edited excerpts from an inter-
getting the investment cycle ally large, but achievable. view:
going—particularly looking at You can actually solve this What are your expecta-
growing the MSME sector, for legal pendency problem in a tions from the Modi gov-
example. I think the chief eco- reasonable length of time with ernment in its second
nomic adviser spoke quite relatively small investment. term?
extensively about the problem Are you not worried My expectations are very
of dwarfism—where we try to about previous economic good particularly since a Mark Mobius, founding partner, Mobius Capital Partners.
incentivize the MSME sector growth number coming in women is going to be in charge.
to remain dwarfs. In fact, we at 5.9% and even 7% this I think a women can make all to lower interest rates, that of course. Boost spending for
should think of them as infants year? Do you think it will the good changes that have to would be very good and of infrastructure but the second
Sanjeev Sanyal, principal economic adviser, ministry of finance. and try to nurture them to materialize? Or, will it be a be made. The most important course, not worry too much thing you have got to do is also
grow. 6% handle? as far as I am concerned is two about the deficit. Right now, it introduce more privatisation of
get a higher investments rate. nomic text books will tell you Then there is finally a very Growth had slowed down in things, one infrastructure and is about 3.50% of gross domes- state-owned enterprises and
Are we not already falter- that domestic savings is driven important reform. We need to the last quarter. Finance min- two jobs for the agriculture sec- tic product (GDP), you can go projects. A lot of the infrastruc-
ing on savings and invest- by interest rates. So, if you cut finally get serious about legal istry has highlighted this quite tor. I believe that hopefully the up to 5% with no problem at all. ture such as toll roads, bridges,
ment rates considering interest rates, you get more reforms. The single biggest clearly. It is not that we are new government will intro- There are a number of things that sort of things could be
that the survey points out investments, but you also get constraint to high growth is unaware that private con- duce the changes that will that the government can do done by the private sector
that India has been an much less savings because the inability to enforce con- sumption demand has slowed encourage more infrastructure now that will really boost the under the right conditions.
island of high growth, people save less as interest tracts and have in the last quarter spending and produce more economy. Interest- There are reports
despite its falling savings rates fall. Therefore, this dispute resolu- or two. We do see jobs for people in the rural sec- ingly enough, the INTERVIEW o f o n e m o r e
rate? dynamic slows down. tion. ‘The data is car sales numbers tor. stock market seems recapitalization
The point we are trying to But, we found evidence, Again, we have clear, you need and other num- If you look at the Indian to be quite optimistic about it. It programme, do you think
make here is that we need a quite to the contrary, that sav- done extensive an investment bers, but the point markets, it has been very is doing pretty well and the that would be a good
growth model to ings is in fact amount of rate in excess of is what is it that is bipolar, the broader mar- exchange rate is improving. move and do you think
sustain 8% INTERVIEW driven by demo- research and the
35% of GDP and a required in order kets has seen a big bear There are people out there who that would lead to per-
growth rates. graphics, it is findings are quite to get this econ- market. Do you think believe good things will come haps some money moving
There are lots of cases in East driven by growth and not by interesting. whole host of omy going again. budget can do anything to from the budget. towards PSBs?
Asia and even in western interest rates. In fact, it is quite E v e r y b o d y policy changes to We have listed change the sentiment You spoke about the I think that will probably
Europe during the post-war insensitive to interest rates. knows that there sustain an 8% out a blueprint around that and lead to a measures that the gov- happen. I am not too keen on it
rebuilding, they also had a Now that gives you a very key are 35 million growth rate.’ that can not only decent rally? ernment could under- though because I would rather
high investment model. There degree of freedom, which cases stuck in the revive growth on Yes, I do think they can do a take to boost infrastruc- see that money going to infra
are constraints to that model means that if you can lower the legal system. We a cyclical basis, number of things. As I men- ture. This will of course projects which actually in an
as well. cost of capital, it gets invest- ran the numbers and we dis- but can create the foundations tioned, first is really boost the come at the cost of the indirect way will help banks.
However, the key points are ment growing, and that gener- covered that it is a large prob- of a long period of growth of infrastructure spending in a big fisc, so there is a thought Because those infrastructure,
the following: First, it requires ates growth, and that in fact, lem, but it is a solvable prob- 8% or thereabouts. There is a way. I am not just talking of that in this budget, the construction firms will get
that the cost of capital is struc- leads to more savings. So, that lem. First of all, most of the well-known way of doing it, small increment, I am talking focus will be more on fis- business and they will be able to
turally lowered. So, cheap cap- allows you to create virtuous cases that are stuck in the which has been demonstrated about 20-30-40% increase in cal expansion rather than pay back the banks, take care of
ital is a very important ingredi- cycles. pendency pipeline are actually by the rest of the world. the budget for infrastructure fiscal prudence. Will that some of the bad loans they have
ent in having high investment What we are arguing is that in the lower courts. So, we are putting a blue- and also encourage those pro- be taken well by foreign with the banks. So, I would
growth rate. Second, that this try to trigger these virtuous So, what can we do about it? print saying that these are the jects that will bring rural investors? rather have that direction
investment almost always cycles rather than trying to We then looked at how many various ingredients of that employment into those big I believe so, if it is done in a rather than direct support of
comes from domestic savings. create some sort of an optimal extra judges need to be model. projects. The other thing the right way and in the right direc- the banks.
Now conventional eco- equilibrium, which we are appointed in order to at least feedback@livemint.com government can do is continue tion. You have to do two things feedback@livemint.com
 POLICY FRIDAY, 5 JULY 2019
NEW DELHI 15

Where India can find a
cool $1 tn infra funding
That’s a lot
EXPERT of money
New infrastructure will
VIEW cost India 72 trillion
($1.05 trillion) over the
ANDY MUKHERJEE next five years; about
55% of it will have to
Respond to this column at be funded by public
feedback@livemint.com resources.
Gas distribution
Economic Survey lays out blueprint for
growth to make India a $5 tn economy
FROM PAGE 1
PRADEEP GAUR/MINT
The Bhalla committee has advo-
cated reducing India’s overall tariffs
of a significant decline in savings/ to benefit from the ongoing trade
(in  trillion)
GDP ratio. “The households seg- war between the US and China.
Electricity 19.4 ment, which includes unincorpo- The Survey favours incentivizing
Telecom 12.2
rated enterprises, is the only net
saver in the economy. Clearly, the
firms based on their lifespan rather
than on size, which leads to “dwarf-
Roads
Railways 6.7
11.8
RBI
alternative would be to rely on for- ing” of MSMEs, encouraging them to
eign savings (for investment) but this remain small. Dwarfs, which the Sur-
Irrigation 6.5 appoints
would expose the economy to wid- vey defines as small firms that never
A.K. Misra
Renewables 4.1 as ening current account deficit with its grow beyond their small size despite
Water supply 3.3 additional associated consequences,” he added. surviving for more than 10 years,
director on The Survey said as investment dominate the Indian economy and
Ports 2.6 J&K Bank
1.9 board
depends crucially on a low cost of hold back job creation and produc-

I
ndia will need $1 trillion of infrastructure investment to 1.6
capital, reducing real interest rates tivity.
Mass rapid transport bit.ly/2Xn0F5f
nudge annual GDP growth higher by just half a percentage need not necessarily lower savings However, Subramanian’s most
Airports 1.1
point in Prime Minister Narendra Modi’s second five-year when the demographics are favoura- original contribution to the Survey
term. Of this, at least 55% will have to come from public Storage 0.8 ble. Finance minister Nirmala Sitharaman may be in its attempt to lay out an
Assumes average annual
resources. Where’s the money? GDP growth of 7.5%. Source: Confederation of Indian Industry
“At the same time, the reduction with MoS finance Anurag Thakur and ambitious agenda for behavioural
Those figures from an analysis by the Confederation of Indian in real interest rates can foster other officials of the ministry. change by applying the principles of
Industry are the No. 1 challenge for Nirmala Sitharaman as the investment and thereby set in behavioural economics to several
country’s new finance minister gets ready to present her first grids and other assets. After Modi’s resounding election victory motion the virtuous cycle of invest- encouraging the bona fide taxpayers issues including gender equality, a
annual budget on Friday. in May, I wrote that India now has structures like Infrastructure ment, growth, exports and jobs. In and punishing the mala fide ones,” it healthy and beautiful India, savings,
While the scale of investment isn’t very different from what Investment Trusts and a toll-operate-transfer model that it can fact, a cross-country comparison said. tax compliance and credit quality.
India spent in the past five years, the sorry state of corporate bal- use to monetize cash-generating toll roads, ports, airports and shows that the cost of capital remains The Survey seeks an “aggressive By analysing the successful behav-
ance sheets makes it doubtful whether the private sector can put power plants. quite high in India, which affects export strategy” for the investment- ioural change effected by the
up its projected 45% share. Besides, the economy is in dire straits, “The proceeds from these sales can be used in the creation of investment prospects in the coun- driven growth model. “While it is Swachh Bharat Mission and the Beti
regardless of the near-7% GDP growth portrayed by disputed new assets,” economists at HSBC Holdings Plc said in a recent try,” it added. true that world trade is currently fac- Bachao Beti Padhao campaigns, the
government statistics. report. “As such, the same pot of money is recycled several times Advocating an “optimal tax pol- ing some disruptions, India’s share Survey incorporates their learning
From consumption and private investment to exports, no cyl- over, without endangering the fiscal deficit, and yet upgrading icy”, the Survey seeks rationalization in global exports is so low that it and lays out frameworks for integrat-
inders are firing. Government spending is therefore the only India’s infrastructure.” of tax policy and its implementation should focus on market share. One ing behavioural economics into poli-
hope. But Sitharaman is in a tight corner. It doesn’t help that rev- Should Sitharaman take this road, she’ll find plenty of interest for startups to foster innovation. could even argue that the current cymaking in various contexts.
enue from a goods and services levy, India’s biggest tax innova- among investors such as Canada’s Brookfield Asset Management “Several studies have also suggested disruptions provide an opportunity “Behavioural insights can be lev-
tion of recent times, continues to disappoint two years after its Inc., Australia’s Macquarie Group Ltd and Singaporean sovereign that capital gains tax can have signifi- for India to insert itself into global eraged to transform the tax culture
introduction by her predecessor, Arun Jaitley. wealth fund GIC Pte. India’s own National Investment and Infra- cant economic consequences for supply chains. The High Level Advi- from one of tax evasion to tax com-
With health, education and other government services also structure Fund, which is 51% private-owned, can be a powerful individual investors in terms of its sory Group, chaired by Dr Surjit pliance. This would then provide the
needing more money, the scope to free up funds by cutting public vehicle for mobilizing global interest. lock-in effects and associated deter- Bhalla, submitted its report in June necessary revenues for investments
expenditure simply doesn’t exist. Nor is borrowing an option. This is the right time. As much as $13 ring incentives to use capital gains 2019 on how India can enhance its in both the hard infrastructure of
Annual federal deficits can’t go much higher than $100 billion; It will be trillion of global debt now offers nega- into riskier investments. Design of exports. Its recommendations need roads, ports, railways, etc. and the
borrowing by the public sector is already cornering resources important for tive yields. Ten-year US Treasuries optimal tax policy also aims to raise to be studied and implemented soft infrastructure of skills and edu-
equal to 8% of the economy even as the household sector barely
India to auction yield less than 2%. revenue efficiently and fairly, while where possible,” it said. cation,” the Survey said.
manages to save 9% to 11% of GDP in financial assets. If ready-made Indian infrastructure
It’s what economists call a classic “crowding out” of the private assets in a way can offer dollar returns in the high sin-
sector. India Inc. is clamouring for lower costs of capital, but the that leads to fair gle digits, it’ll get lapped up by yield-
level of public debt is keeping them elevated. Cuts in the central outcomes hungry investors.
bank’s short-term policy rates can’t be passed on to private com- There are caveats, though. Although
panies if they’re not even reducing the government’s long-term
borrowing costs as much as they should. Besides, a shadow-bank-
ing crisis has made lenders mistrustful of the private sector’s sol-
existing projects will carry no or little
construction risk, they would be exposed to future regulatory
uncertainty.
CEA’s playbook advocates blue sky thinking
vency, especially for debtors that have anything to do with coma- Only risks that can be priced should be passed on to new own- MINT
tose real estate. That’s one more reason why inflation-adjusted ers. Moreover, it will be important for India to auction assets in FROM PAGE 1 for behavioural change on mended. Easing labour laws
borrowing costs are 5%-plus. a manner that leads to fair outcomes. issues such as gender equality, can add many jobs, it added.
A consensus is building around the idea that Sitharaman’s best With $1 trillion required to build new infrastructure, India from behavioural economics a “healthy and beautiful” The Survey recommended
option is to recycle public assets, something that Australian states can’t afford similar bungling when it comes to state assets. That’s can help design impactful India, savings, tax compliance ways of bringing a cultural bias
such as New South Wales have successfully achieved with power something Sitharaman should keep in mind. BLOOMBERG public policy. It can help the and credit quality. in favour of tax compliance by
State steer people to make the “There is some merit to that. honouring top taxpayers. One
DELHI JAL BOARD, (GOVT. OF NCT OF DELHI) right choices without depriv- One has to experiment on this. of the factors that drives tax
OFFICE OF THE EXECUTIVE ENGINEER (C)DR-II ing them of the choices they People do tend to make choi- evasion is individuals’ percep-
DELHI GATE STP PHASE-II, OPPOSITE DELHI SECRETARIAT have, as people tend to stick ces based on motives and tion of the benefits and servi-
IP ESTATE, NEW DELHI-110002 with the default options incentives. If there are right ces they get from the govern-
E-mail: eecdr2@gmail.com among a set of choices. The kind of incentives, people will ment and how taxpayer funds
Corrigendum No. 01 technique can help in scenar- behave accordingly,” said D.K. Easing labour laws can add are utilized in the economy.
NIT No. 01 (Re-invited) 2019-2020 EE(C)DR-II ios such as persuading the Joshi, chief economist at rat- many jobs, says the Survey. The Survey said that to
(ID No.: 2019_DJB_174220_1) well-off to give up subsidies, ings company Crisil Ltd. encourage tax compliance, top
Name of work: Construction of 60 MGD WWPS at Kilokari including allied appurtenant works, and 10 years O&M. making people sign up for sav- The Economic Survey The Survey argued that 10 taxpayers within a district
In reference to above NIT, the last date for online submission of tender and opening of Technical Bid (Part-A) is ings or health insurance makes a strong case for using small enterprises are not able could be accorded due recog-
extended from 05.07.2019 to 20.07.2019. schemes and making farmers the massive amount of data to sustain the jobs they create, nition. This may take the form
The other terms and conditions of the NIT shall remain the same. buy fertilizers on time, said the generated by a rapidly digitiz- while large firms are able to of expedited boarding privi-
ISSUED BY P.R.O. (WATER) Sd/- Survey, citing global public ing economy for the public create permanent jobs in large leges at airports, fast-lane priv-
Advt. No. J.S.V. 131/2019-20 E.E. (C) DR.II policy experiments leveraging good. It describes data as a numbers. It, therefore, makes ileges on roads and toll booths,
behavioural economics. “public good of the people, for a case for removing incentives special “diplomatic” type lanes
The impact of flagship gov- the people and by the people”. that encourage firms to at immigration counters, etc.
ernment initiatives such as Subramanian, however, dis- remain small. “To unshackle Also, the highest taxpayers
Swachh Bharat Mission, Jan tinguished intimate or confi- micro, small and medium over a decade could be recog-
Dhan Yojana and the Beti dential data from public data enterprises and thereby ena- nized by naming important
Bachao Beti Padhao provides and said processing of the ble them to grow, all size- buildings, monuments, roads,
testimony to the potential of former would be in line with based incentives must have a trains and universities in their
behavioural change in India, the Personal Data Protection sunset clause of less than 10 name. The idea is to set up
said the Survey. Subramanian Bill that is awaiting Parlia- years with necessary grand-fa- “clubs” that exude not only
lays out an ambitious agenda ment’s nod. thering,” the Survey recom- social status, but also honour.

ATAL NAGAR VIKAS PRADHIKARAN

Paryavas Bhawan, North Block, Sector-19, Atal Nagar,
Distt. Raipur - 492 002, Chhattisgarh.
Tel. No. : +91 771 2512000; Fax No.: +91 771 2512400.
Website : www.nayaraipur.gov.in, http://eproc.cgstate.gov.in
E-Procurement Tender Notice (SHORT-NIT)
The Chief Executive Officer, ANVP invites item rate tender for the following works
NIT No: 05/INT & FUR-CMDC /EEC-I/E-in-C/ANVP/2019-20, Atal Nagar, Dated : 02.07.2019
Name of Work : Interior-Decoration & Furnishing works in Chhattisgarh Minral
Development Corporation Office Building at Atal Nagar, Distt. Raipur (C.G.)
Estimated Cost : INR 1.68 Crores, EMD : INR 1.68 Lakhs, Period of Completion :
03 Months. Last Time & Date of Online Submission : 15:00 hrs on 23.07.2019
The E-Procurement tender documents can be downloaded from the Portal
(Website) http://eproc.cgstate.gov.in directly and shall be submitted online on the
same website only after making on payment of bid participation fees online.
Amendment in tender, if any, will only be uploaded on the website and shall
not be published in any newspaper.
S-21712/5 Engineer-in-Chief, ANVP
16 FRIDAY, 5 JULY 2019
NEW DELHI VIEWS

OUR VIEW MY VIEW | FARM TRUTHS

The Economic Survey fails to

put the spotlight on real issues
K. Subramanian’s first Survey offers everything but a clear assessment of the state of the economy

quarter was 5.8%, the lowest since the
NDA took over in 2014. More recent
indicators suggest a decline in automo-
bile sales, which account for a signifi-
cant share of manufacturing output.
The Purchasing Managers’ Index for
services suggests a contraction in servi-
ces output. Agricultural growth rate this
year is expected to be almost half the
HIMANSHU previous year’s. The agrarian sector is in
is associate professor at Jawaharlal Nehru a crisis, with the terms of trade not in its
University and visiting fellow at the Centre favour. Rural wages have stagnated.
de Sciences Humaines, New Delhi Despite the overwhelming evidence
of the economy showing signs of acute
JAYACHANDRAN/MINT distress and growing unemployment,
there is neither a diagnosis of where
ing its purchasing power decline. See-
ing investment as the panacea for all
that ails the economy also stems from a
wrong macro-economic understanding
that assumes an investment boost to be
the only way of achieving higher
growth. This is unlikely to be effective
in an economy suffering from declining
demand. The situation is far more seri-
ous in rural areas, where stagnant wages
and incomes from agriculture have led
to an agrarian crisis. Unfortunately,
there is no mention of the agrarian crisis
in the entire first volume, which talks
about achieving a $5 trillion economy.
Similar to earlier surveys, volume one

The case for a nudge C

hief economic adviser Krishna- things went wrong, nor an acknowl- of this survey discusses issues that are
murthy Subramanian had the edgement of the challenges in reviving more likely to be of academic interest.
unenviable task of presenting growth. These challenges are not just The focus of this survey on behavioural
the first Economic Survey of the second domestic—arresting a decline in con- economics is noteworthy. So is the
National Democratic Alliance (NDA) sumption and reviving investment at a emphasis on blind application of neo-

in the right direction government at a time when most indi-

cators show a clear slowdown in the
economy. He also had the responsibility
of coming clean on the controversy over
time when the financial sector is staring
at another crisis—but also emanate
from the external front, given the
uncertainty in West Asia and the
classical equilibrium models to the
Indian economy. But then it goes on to
argue in favour of investment as the
engine of growth without any rationale
the national accounts, doubts on which aggressive stance of the US on tariffs. As for higher investment—or its source—in
have been raised by none other than his the survey rightly points out, with a demand-constrained economy.
The Economic Survey projects an uptick in the economy. Refreshingly, it also proposes the predecessor Arvind Subramanian. assumptions, the economy will have to Another noteworthy chapter is on data,
While there may be little merit in grow at least at 8% per annum if the which emphasises its public nature. But
adoption of insights drawn from behavioural economics to guide the country along Arvind Subramanian’s estimates of government’s ambitious target of a $5 these remain academic matters, given
gross domestic product (GDP), the trillion economy by 2024-25 is to be the restrictive approach of the govern-
issues raised by him deserve a response achieved. However, except for one year, ment on the dissemination of public
from the government. Most independ- the government in its first term has data, including its own surveys. This has

T
his year’s Economic Survey, the
first released by India’s finance
ministry with Krishnamurthy
Subramanian as chief economic
adviser, serves as theme music for
the budget due today. In this
orchestral exercise, there are high notes and
low, but rather few false ones. It rouses just
enough optimism to keep gloom at bay. It pro-
jects the economy’s growth at 7% this fiscal
year, which is a percentage point less than
what’s needed to hit the government’s $5 tril-
lion target by 2024-25. For an acceleration of
economic activity, it cheers on the “animal
spirits” among investors that a stable govern-
ment is expected to uncork. The investment
decline, in its view, will soon be behind us; an
easing of credit, coupled with a demand
pick-up, will see to that. A virtuous cycle is
expected to feed into other variables, and so a
consumption revival has been forecast as well.
Vicious cycles exist, too, and the Survey speaks
back. The done and dusted is all there. But ent experts have voiced the need for an failed to achieve this, despite its windfall been seen not just in the case of employ-
what could act as a conversation starter is its official assessment of the GDP method- gains from the collapse of oil prices. ment surveys of the National Sample
ology, regardless of Arvind Subrama- To be sure, the survey does offer pre- Survey Office, but also other data of
description of data as a “public good”—the nian’s criticism of the GDP estimates. scriptions for achieving the Prime Min- public importance, none of which finds
“new oil”, as it were. In an era that has blurred The Economic Survey mentioned ister’s ambitious target. It recommends any mention in this Economic Survey.
the division between what’s public and what’s none of this. It also failed to provide a following the East Asian economic Although some of these crucial issues
private, after all, the optimal role of the state in correct assessment of the state of the model of increasing investment. But of employment and agrarian crisis do
economy, which is its primary objec- this is not new. This has been pre- find mention in the second volume,
the capture and use of big data remains no less tive. It remains the official document scribed since 2014, but without any there is no acknowledgment of the
hazy. It’s good that a debate is finally astir. presented to Parliament on the state of success in raising the investment rate. magnitude of the problem or an analysis
The most striking aspect of the Survey, how- the economy. Even by the official Despite interest rate cuts, there has not of policy failures. The academic part of
ever, is its embrace of behavioural economics. assessment of the Central Statistics been any significant improvement in the survey is likely to generate more
Arguing that old methods of analysis assume Office (CSO), gross value added growth the investment rate, which remains discussion than the real issues, which
for 2018-19 was the lowest in at least below 30% of GDP. With government should have been assessed and pre-
too much rationality on the part of people to four years, with 2015-16 being the only finances already stretched and little sented to the public at large. Like earlier
explain reality, it proposes the adoption of year during this period when it hit 8%. room for expansion, the onus of increas- surveys, this survey has everything
tools that rely on shifts in behaviour to achieve Since then, it has declined steadily to ing investment is on the private sector. except an honest and clear assessment
a set of outcomes. A few cases cited seem like 7.9% (2016-17), 6.9% (2017-18) and 6.6% And the onus of raising savings is on of the state of the economy and the
plain and simple persuasion aimed at altering in 2018-19. The growth rate in the last household sector, which is already see- challenge of reviving it.
social norms, as in Swachh Bharat’s reproach
of open defecation, but others do go beyond
clever marketing. The government itself had
to overcome an irrational “loss aversion”, it
says, to overhaul indirect taxes in a way that
would spell losses now for gains later; this www.livemint.com New Delhi, Mumbai, Bangalore, Kolkata, Chandigarh*, Pune* Monday, July 6, 2009 Vol.3 No.159 Rs. 3.00 24 PAGES

of a “constant disequilibrium” that prevails and would be music to the ears of psychologist All you need to know
LIFE:
about education loans >12-13
WSJ: Robert Hotz on the discovery of
Because seemingly tiny
needs to be turned favourable. On exports, Daniel Kahneman. The Survey’s theorist of EXCLUSIVE PARTNER
the world’s oldest musical instrument >19
TELECOM: Number portability may not
see big churn, but may still hurt telcos >6
changes in the environment
vital to this effort, its outlook is sombre. On the choice, though, is Richard Thaler, a champion SENSEX 14,913.05 ® NIFTY 4,424.25 ® DOLLAR Rs47.90 ® EURO Rs66.97 ® GOLD Rs14,455 ® OIL $65.75 ®

can influence behaviour,

REVERSE SWING ANOTHER VERSION

What’s inside
Promoters The budget speech
fiscal front, it strikes a realistic chord over the of libertarian paternalism. The paternal state’s Swiss drug maker Novartis, which last week was denied a
patent for its blood cancer drug Glivec by India’s Intellec-
tual Property Appellate Tribunal, may challenge the rul-
ing at the Trade Related Intellectual Property Rights fo-
rum of the World Trade Organization and in one of
the high courts of India. >P4 seektoregain
Mamata didn’t give
B Y A SIT R ANJAN M ISHRA,
K . P . N ARAYANA K UMAR &
Although she didn’t choose to
read this version of her railway

choice architects wield

R AHUL C HANDRAN budget speech, it did manage to
BUDGET 2009 ··························· find its way to the website of the

need for big outlays on farm relief in the face of job is to “nudge” rather than force people to act pledgedstock I
NEW DELHI Press Information Bureau before
f railway minister Mamata it was taken out and replaced
Banker’s Trust: Pranab babu, we need Banerjee had picked another with the version Banerjee deliv-
financial sector reforms >P6 version of the speech she deliv- ered.
Expert Village: Bimal Jalan on the ered in Parliament on Friday, Interestingly, the alternative
economic policy that underpinned different the nation would have known version is critical of former rail-
budgets over the last few decades. >P10 At least 77 of the 667 REDEEMING SHARES that the railways are in a bigger way minister Lalu Prasad’s poli-
Graphic:The budget and the Sensex >P10 companies whose fiscal hole than the government
has let on and Kolkata may have
cy of banking on reserves to fund
THE NEWS

slippery tax collections, but betrays no hint of as desired, done by offering them choices
Graphic: A look at previous budgets >P11 promoters had pledged

immense power. Theirs is a

Promoters of at least 77 firms have been in line for a larger bonanza. TURN TO PAGE 2®
Our View: Reforms, not fiscal, push >P22
Views: What to reform—fewer subsidies,
shares last year have redeemed part of the shares they pledged
to raise funds during the liquidity crunch.
more investment >P23 repaid some creditors
Canny FM
Views: Back to the state—greater public THE BACKGROUND
Rebounding stock prices since April have CAPITAL CALCULUS
expenditure needed >P23 B Y A SHWIN R AMARATHINAM
increased the notional wealth of company ANIL PADMANABHAN
may spring
ashwin.r@livemint.com
························· promoters, helping them redeem their
MUMBAI
collateral. Promoters of 667 firms had
ter will reveal similar policy

the deficit slipping out of control. laden with apt incentives. The Survey wants
pledged their shareholdings in fiscal 2009.

T he rebound in stock
prices since the start of THE IMPLICATION a surprise acumen, particularly a sensi-
tivity towards fiscal reform,

gentle power, since they

the current fiscal has in- Analysts interpret this as a sign of the when he unveils the budget.
economy looking better. Credit growth
creased the notional wealth of
company promoters
helped them redeem part of
and is improving and companies
are seeing higher demand
T he Congress-led United
Progressive Alliance (UPA)
demonstrated political
Mukherjee gave glimpses of
that acumen when he began
the process of rationaliz-
from consumers.
the stock they pledged in re- acumen by increasing ing direct tax rates in his
turn for funds when the going fuel prices last week, last budget 25 years ago.
LEADING THE NEWS ECONOMY AND POLITICS wasn’t so good. ahead of the budget due Based on the signals

Any such survey is best read not for specifics, citizens nudged out of tax evasion and other
China’s government reiter-
ated its opposition to car-
bon tariff policies affecting
trade, saying they could
At least 77 of the 667 compa- tor Unitech Ltd, auto maker on Monday. By doing so, sent out by the Econom-
nies whose promoters pledged Tata Motors Ltd, software firm finance minister Pranab ic Survey, there is reason
their shareholdings last year Tata Consultancy Services Ltd Mukherjee ensured that to believe he will do an
have repaid their creditors and (TCS), wind turbine manufac- his fourth budget is encore.

merely nudge rather than

Several developers have
stopped discounts and
price cuts on housing pro-
provoke a trade war. >P19
***
The anti-incumbency factor
in West Bengal alone could
drive the state’s Left Front
redeemed their collateral, ac- turer Suzlon Energy Ltd, Jindal shielded from the politi- Not many would be
cording to data filed by these Steel and Power Ltd, and con- cal criticism usually associated aware that he was instrumen-
firms with stock exchanges. with such a decision.
The companies include real- TURN TO BACK PAGE ® It has to be seen if the minis- TURN TO PAGE 3®

but for what it says of the regime’s economic “sins”. Inertia is often the chief problem, it
jects, but analysts say it’s a government out in the as-
ploy to test the waters. >P7 sembly polls in 2011. >P5
***
The Major Economies Fo-
***
Suresh Tendulkar has said NTPC may sign
rum is likely to come up
with a token declaration on
he is asking the govern-
ment to diversify its foreign RIL gas deal,

coerce.
climate on the sidelines of exchange reserves and hold
a G-8 summit in Italy. >P8 fewer dollars. >P14 says executive

idealism. Much of what it elaborates has been argues, and if things are arranged so that doing
VIEWS
Developing nations B Y U TPAL B HASKAR
should resist the urge utpal.b@livemint.com
·························
to accumulate power in NEW DELHI
the state’s hands in
the guise of dealing
with the economic
crisis, says V.
I n a softening of its stand,
state-owned NTPC Ltd is
willing to buy natural gas from
Mukesh Ambani-led Reliance

articulated before, especially Prime Minister what’s right is our default position and erring
Anantha Nag-
eswaran. >P22 Industries Ltd (RIL) at the
price set by the government,
according to a top executive at
the utility. NTPC is ready to
look at some of the issues it
QUICK EDIT raised over the gas sale pur-
chase agreement, or GSPA,

Security mirage in J&K with Reliance.

The country’s largest power

Narendra Modi’s welfare agenda. It also delves takes “opt-out” effort, then it could be tackled.
producer is willing to sign an

L
ocal protests in Jammu
and Kashmir (J&K) are
ensuring the exit of the
Central Reserve Police Force
(CRPF). CRPF began
withdrawing from Baramulla
in the state last week. The
in no shape to take over. That
could set the stage for the
wiping out of recent gains
such as the successful
installation of the Omar
Abdullah government and the
relative calm in the state.
R I C HA R D THA L E R &
agreement with RIL to purchase
2.67 million standard cu. m of
gas per day (mscmd) at the $4.2
(Rs201.60) per million British
thermal unit (mBtu) price set by
the government, said the execu-
tive, who didn’t want to be

CASS SU N STE I N
Union government terms it That would be a costly named because of the sensitive

into such touchy subjects as labour reforms, This message isn’t lost on the government,
“rationalization” of
paramilitary force
deployment. It is an open
secret that its hand has been
forced.
This will not serve the state
government in any manner. If
the Central forces are
trade-off: Winning hearts and
minds in J&K should not be
done at the cost of
deteriorating security there.
The cost of re-establishing
control if the situation gets
out of hand is not worth the
purchase of public
nature of the issue.
After a meeting with RIL rep-
resentatives on Friday, NTPC
is ready to forgo the marketing
margin provided it is asked by
the government to do so, and
will discuss the take-or-pay
clause with power procurers.

using state-wise trends to argue against rigid presumably. Fixing the economy is a must-do,
withdrawn, the militants sentiments. Let us hope the RIL wants NTPC to pay a mar-
stand a good chance of Union and state governments keting margin of 17 cents per
moving in. The state police is are cognizant of that. mBtu over and above the price

Mint is also available for Rs5.50 with Hindustan Times under a combo offer TURN TO PAGE 2®

laws that hold expansion and employment it knows. Opting out would cost it dearly.

MY VIEW | LEARNING 4.0

The special role of arts in the day and age of machines

and responding to social situations, political
KAPIL VISWANATHAN crises and technological innovations.
& SANGITA JINDAL Whether it is Picasso’s Guernica or Joseph
Heller’s Catch-22, an impassioned work of
art or literature carries within itself the
capacity to explore and expose the status
quo, in this case the brutality of war.
dent of Stanford University, in an address to art biennales and other such festivals. into their age of renaissance.
Stanford’s academic council, emphasized In fact, we contend that most of these gen- Google’s project Magenta has already
the role of the arts, interwoven with other
disciplines such as technology, in helping
res learn from each other under the shadow
of technological innovations. Our inner
written a song by itself, without any human
input. It developed a taste for music by
students think creatively and imaginatively mechanisms as human beings are constantly studying thousands of popular tunes, and
in solving complex problems. getting tweaked with changing environ- taught itself how to create a new tune.
What used to be STEM (science, technol- mental stimuli. It is art, cinema and litera- Aiva (acronym for Artificial Intelligence

are, respectively, vice chairman
of Krea University and
chairperson of JSW Foundation
F
rom cave paintings during the stone
age to subway graffiti in today’s cities,
the arts have consistently borne wit-
ness to the complex journey of human
progress. The ability to appreciate and cre-
ate beauty in various forms sets us apart from
other living species and machines—it is what
makes us human.
The 6th century Sanskrit poet Bhartri-
hari, in his Neeti Shatakam, opines that a per-
son devoid of poetry, music and arts is verita-
bly an animal. A thousand years later, the
bard, Shakespeare, in The Merchant Of Ven-
ice, similarly derided “the man who hath no
music in himself” as someone fit for treason
and not to be trusted.
In more recent times, when Winston
Churchill was asked to cut government
spending on the arts during World War II,
his purported response was, “Then what are
we fighting for?”
Art is much more than the display of a
skill; it is a way of imaginatively exploring
Movements like Cubism and Abstraction
have held a mirror to the changing face of
our civilization—the atomization of the indi-
vidual and the fragmentation of life itself in
the mechanized 20th century.
At the centre of changing technology and
altering art forms stands the human being,
whose own technologies of the self are con-
stantly and continuously transforming.
In a changing world of data, Artificial
Intelligence and autonomous machines, the
arts are of greater significance than ever
before. The culture of instant gratification
and shortening attention spans are at odds
with deep, reflective and purposeful consid-
eration of problems facing our world today.
Harvard University’s former president
Drew Gilpin Faust boasts of an arts history
class at Harvard where students are com-
pelled to gaze at a painting for three straight
hours. It’s not difficult to imagine the impact
this would have on fast millennial minds.
John Hennessy, the iconic former presi-
ogy, engineering and med- ture that finally help us to Virtual Artist) is the first machine to be
icine) is now STEAM (with understand deeply our recognized as a composer by a music society,
arts having been added). Arts can inspire shifting moral compass the 150-year old SACEM in Paris.
The arts can motivate and steady our inner land- Ahmed Elgammal, a computer scientist at
thinking that is non-linear, thinking that is scape. Rutgers University, has created an algorithm
breaking stereotypes and Creating VR scenes and to produce original paintings, based on an
existing paradigms.
non-linear, storyboards, for example, aesthetic it develops by studying thousands
Research conclusively
proves that achievement in
breaking provides more degrees of
freedom for artistic expres-
of paintings of different artistic styles. In a
blind (poor pun intended) test with human
academic, social and emo-
tional spheres are all
stereotypes sion.
As with art in any
subjects, he found that the paintings pro-
duced by his algorithm were preferred over
encouraged by the practice and existing medium, these can be used paintings produced by human artists,
of arts. to create a greater sense of including several from Art Basel, one of the
Recent years have seen paradigms empathy and understand- top art shows in the world.
the emergence of new ing of the other. For exam- The implications of machine-created art
media for creative expres- ple, a VR simulation of life and new media are complex and several. But
sion, just as photography blossomed as an in a refugee camp can have a great impact on one thing is for sure—it will add to the rich-
artistic medium in the last century. Virtual forming public opinion on whether a coun- ness of the universe of the arts, which
reality (VR) and Artificial Intelligence have try should accept refugees. humans can enjoy and appreciate.
to be seen as instruments that help extend Finally, we cannot ignore the inevitable The arts have been an integral and defin-
the artist’s or writer’s imagination, just as the question of whether machines can appreci- ing part of the human journey. Whether we
camera did. They do not supplant it. New ate and produce art. It is fair to say that lived in caves or plan to colonize Mars, the
media works occupy a pride of place in many machines have stepped out of their dark ages arts represent the essence of humanity.
 VIEWS FRIDAY, 5 JULY 2019
NEW DELHI 17

THEIR VIEW OT H E R VO I C E S

The $5 trillion-economy goal is a EU institutions need better representation

T
dangerous distraction for India
he method for filling the senior roles in the apparatus of the European Union
is not an obvious advertisement for the project. National leaders go into con-
clave and emerge with nominees whose connection to citizens of member states
feels tenuous. The outcome inevitably represents a complex, multilateral compro-
mise. The new European commission president, Ursula von der Leyen, is a German
Christian Democrat who was few people’s first choice but proved less distasteful
than rivals to various caucuses... Christine Lagarde, currently leading the IMF, will
A GDP goal set in US dollars is far removed from what average Indians care about. That is, their real earnings in rupees be head of the European Central Bank, and Josep Borrell, Spain’s foreign minister,
is teed up for the role of high representative for foreign affairs... Two of the top four
are women helps to redress an imbalance that has plagued EU institutions... There
GRAPHIC BY AHMED RAZA KHAN; PHOTOGRAPH BY SAISEN/MINT is already a cultural divide between early adopters of the European project – who
see themselves as curators of its founding ideals – and later entrants, who are more
suspicious of integration.
To shore up their integrity, the EU’s institutions need to be places where citizens’
interests are conspicuously represented, not impenetrable political labyrinths.The
true test of the new commission and council presidents will be whether they under-
stand that balance, and how capable they are of communicating it not just inside
but beyond corridors in Brussels.
The Guardian

VIVEK DEHEJIA & RUPA

SUBRAMANYA
are, respectively, a Mint columnist and a Hunt’s warning on Hong Kong sours UK’s image
Mumbai-based economic researcher and writer

A fter demonstrators stormed and vandalized the Hong Kong Legislative Coun-
cil, British Foreign Secretary Jeremy Hunt did not criticize violent protesters.
Instead, he demanded that China abide by the 1984 Sino-British Joint Declaration,
which has long since been fulfilled, and warned of “serious consequences” if China
neglects commitments. Hunt said, “We stand foursquare behind the people of

O
n Saturday, 15 June, Prime Minis-
ter Narendra Modi declared:
“(The) goal to make India a $5 tril-
lion economy by 2024 is challeng-
ing, but achievable, with the con-
certed efforts of states.” This goal
has solid support from the International Monetary
Fund (IMF). Its most recent projections suggest
that India’s gross domestic product (GDP) will
touch about $4.7 trillion in 2024. This is close
enough to $5 trillion to make the latter a credible
headline target, and 2024 is a natural year to focus
on given that Modi and his government will be bat-
ting for a hat trick in general elections that year.
Taking a cue from this, a bevy of economists and
analysts have started a “debate” on how best to
achieve this target. Unfortunately, this is, in our
judgement, an entirely misguided and problematic
exercise.
The crux is this: The IMF’s projection and Modi’s
goal for GDP is stated in terms of nominal US dol-
lars. In other words, the size of India’s economy as
measured by the value of the dollar that will prevail
in 2024. While statistically valid, this is an eco-
nomically meaningless construct, at three removes
from what average Indians care about—real rupee
GDP per capita. Ask: In 2024, will an ordinary mid-
dle-class Indian be revelling in the fact that his
country’s economy is worth close to $5 trillion, or
will he be asking what is the purchasing power of
his own income in rupees? Clearly, the latter
affects his and his family’s life prospects, not the
former.
So, who gains from a $5 trillion economy? Evi-
dently, large Indian multinational firms, or high
net-worth individuals looking to invest abroad, or
deep-pocketed foreigners looking to invest in
India may benefit from India’s larger aggregate
dollar footprint. None of this is of any concern to
the well-being of the average Indian.
This criticism can be made precise by looking at
the underlying data guiding the IMF’s projections,
and comparing its data to official Indian govern-
ment data, as reported annually by the ministry of
statistics and programme implementation (Mospi).
Crucially, the IMF reports aggregate GDP in nomi-
nal dollars, from which we have extracted the
implied growth rates, while the Mospi, among
other indicators, reports real GDP per capita in
rupees. The graph alongside presents the striking
results of this data comparison.
The first column shows real rupee GDP per cap-
ita growth for the years 2015-2019 (note: we use the
convention of reporting the fiscal year with the
second of the calendar years it straddles, for sim-
pler comparability with international data in cal-
endar years). This series is quite stable, ranging
from 5.6% to 6.8%, with an average for this period
of 5.92%. Notice that, via the “rule of 70”, this
Rupee growth is out of sync with dollar calculations
Real GDP growth Nominal aggregate GDP growth in $
per head in ₹ Actual
2015 5.8 3.16
2016 6.8 8.85
2017
5.7 15.83
2018 5.7 2.43
2019 5.6 9.40
Average 5.9 7.93
2020
2021
2022
2023
2024
Average
Sources: Real per capita growth rate in rupees from annual 31 May Mospi reports; nominal growth rate in dollars
actual and projected figures from World Economic Outlook October 2014 and April 2019; and authors’ calculations.
implies that real income for the average Indian will
double in 10-11 years. The second column reports
the growth rate of aggregate GDP in nominal US
dollars for the same time period, and the data is all
over the map, from a low of about 2.4% to a high of
15.8%, with an average of 7.9%.
Why the big fluctuations, and the fact that dollar
aggregate GDP on average grows faster than real
rupee per capita GDP? These are the three
removes we mentioned earlier. To convert per
capita real rupee GDP growth into nominal dollar
aggregate GDP growth, we must add an adjust-
ment for population growth, for domestic (Indian)
price inflation, and for the change in value of the
nominal Indian rupee exchange rate vis-a-vis the
US dollar. While population growth and, at least in
recent years, inflation have been stable, exchange
rates fluctuate massively over time, and this leads
to the bizarre result that (for example) India’s nom-
inal dollar GDP growth rate fell from 15.8% in 2017
to 2.4% in 2018, while real rupee GDP per person
remained rock steady at 5.7% over this two year
period. This is purely an artefact of exchange rate
fluctuations, which bedevil the former but not the
latter measure.
The third column gives us ample cause to be
wary of the IMF’s projections. Compare the second
and third columns, and you will see how far off the
mark the projection was just about each year.
Notice also that the average projected growth rate
IMF
projection
9.76
8.89
9.20
8.82
9.41
9.21
9.61
9.81
9.69
9.74
9.82
9.74
over the same 2015-2019 period is about 9.2%, or
fully 1.3 percentage points higher than the actual
realizations.
So, how credible are the IMF’s projections for
the coming five years? The average of the 2020-
2024 projections is 9.7%, which makes possible the
claim that India will approach a $5 trillion GDP by
the terminal year. Yet, if recent experience is any
indicator, the IMF appears consistently to overesti-
mate rather than underestimate India’s growth
prospects. This suggests to us that the $5 trillion
goal may indeed remain out of reach.
Much more importantly, a focus on the level of
GDP in nominal dollars deflects debate into specu-
lation on the behaviour of inflation and exchange
rate dynamics over the coming five years, and
takes the focus entirely away from what matters,
which are the structural economic reforms neces-
sary to boost real rupee GDP per capita. Notice that
the more serious defenders of the $5 trillion target
routinely fall back on assumptions about inflation
and exchange rates to rationalize the goal and are
not claiming that real rupee GDP per capita will
grow above its present fitful rate.
Modi must resist the temptation to fall into the
Washington trap of fixating on an arbitrary dollar
GDP level and focus instead on what he has cor-
rectly said his government cares about, the well-
being of average Indians. The $5 trillion target by
2024 is a dangerous distraction.
Hong Kong” and urged the Hong Kong regional government not to “repress” its
people. Hunt’s statements have gone too far. Some people say that he made the
strong statements for contending for the leadership of the Conservative Party to
become British prime minister. China’s Ministry of Foreign Affairs on Wednesday
strongly refuted Hunt’s words.
Hunt’s words, called “shameless” by a Chinese foreign ministry spokesperson,
must have been heard in Hong Kong, misleading some protesters to believe that
their behaviors are justified. Indeed, there are deep internal reasons behind Hong
Kong’s unrest. Hunt inflamed Hong Kong’s situation, which only ruins his and the
UK’s image. He sabotaged China-UK relations for his personal political interests.
The UK’s diplomacy toward China will pay for his behavior.
Global Times, China
The Philippines’ decision on ecozones is sound
O n June 22, President Rodrigo Duterte ordered a moratorium on applications
for new economic zones within Metro Manila, seeking instead to encourage
locators to apply for ecozone status outside the city. Although Administrative Order
(AO) 18 apparently did not inspire enthusiasm on the part of the Department of
Trade and Industry (DTI), the Philippine Economic Zone Authority (PEZA) and
business groups, it is one of the soundest economic decisions made by the adminis-
tration in quite some time... All President Duterte has done with his order is return
ecozones to their original concept, which happens to dovetail nicely with his oft-
stated goal to spread economic development to the provinces. The idea behind
establishing a special economic zone is to stimulate the economy in the local area,
while at the same time offering the incentive of government support to companies
that face a steep curve in setting up their business there.
A level playing field and attractive environment for investors is important, but
those should be the attributes of the economy in general, and not achieved as costly
special conditions. Foregoing tax revenues or relaxing other rules to encourage
investment and businesses to thrive in the local economies outside Metro Manila
over a longer term is a reasonable trade-off; doing so simply out of fear that some
investors may go elsewhere is not.
The Manila Times
A pre-election debate that lacks vision
O n July 3, the day before the House of Councillors election campaign kickoff,
a debate among the heads of seven major political parties was held at the
Japan National Press Club. The issue of pensions and other social security-related
policy; an assessment of Prime Minister Shinzo Abe’s pet “Abenomics” economic
policy mix; constitutional amendment; and foreign diplomacy and national security
are among the issues that will be disputed in the election, and took up most of the
debate. But not only did none of the party leaders address the problem of depopula-
tion head-on, there was no active discussion on how to deal with the anxiety many
citizens feel about the future. Both the ruling and opposition parties must make
efforts to further debate about the future during the campaign.
The coming upper house election will be a chance for voters to offer their evalua-
tions on the achievements of the Abe administration, which has been in power for
6 1/2 years. However, during the debate, the prime minister merely referred to fig-
ures that conveniently showed himself in a good light, like the jobs-to-applicants
ratio, and bragged that he had “brought Japan out of a state of deflation in an
extremely short amount of time.” To cover up inconvenient issues is to belittle and
disrespect voters. We hope the upcoming election is one in which both the ruling
and opposition blocs grow out of such tactics.
The Mainichi, Japan

THEIR VIEW

What this fiscal year’s budget would do well to address

the most foolhardy investor stagger back.
INDIRA RAJARAMAN The water problem in Chennai is the stuff of
international headlines. At present, these
needs are met by trucking in water mined
from rural areas, but it is only a question of
time before those sources become ever
rate structure (my Raja Chelliah Memorial
Lecture, March 2019), which levied pur-
chases at the under-construction stage but
not on completed housing, hitting working
capital availability to the housing sector
badly. This has been the pattern even after
NBFCs seem not to have assessed market
demand. The key error lay in loading onto
GST the burden of stamping out unaccount-
ed-for wealth, without any thought to the
replacement source of working capital for
the housing sector.
gnome within it working against simplifica-
tion, which is one of the necessary condi-
tions for inspiring business confidence and
the willingness to invest. At the latest meet-
ing of the GST Council on 20 June, new GST
forms with submission requirements unfa-

I
n a few hours, we will have the post-elec-
tion Union budget for fiscal year 2019-20.
Finance minister Nirmala Sitharaman had
called for crowd-sourcing of suggestions on
top of the advice rendered at meetings con-
vened by the NITI Aayog and the finance
ministry. There is even a Penguin book col-
lectively authored by many people. Coping
deeper and costly to access. Unless there is a the levy was shifted in February 2019 from In the face of unsold inventory and near- miliar to taxpayers were introduced. Form
nationally coordinated water mission, which an input credit system to a bankrupt NBFCs, invest- GSTR 1 will be replaced by GST ANX-1 from
reduces the cultivation of thirsty crops such composition basis. Under- ment in housing cannot be October 2019 (luckily submission frequency
as paddy and sugarcane, or switches paddy construction housing is The need to expected to take off. The unchanged), where the new form has a hang-
cultivation to less water-intensive methods now levied at 5%, with an need of the hour is for the ing provision for invoice uploading, which
like the system of rice intensification, releas- affordable carve-out at 1%, revive private urban development minis- can be continually added to. Two months
ing a larger residual amount of water for but completed housing is try to identify the factors, later, in December 2019, the summary form
other activities, no investment will happen. not. The reason for this
investment whether transportation or GSTR 3B, familiar and accepted by taxpay-

is an economist
with the flood must have been a problem in
itself, adding to the time pressure under
which the whole process had to be gone
through.
Fortunately, all advice seems to converge
on a single recommendation, to wit that the
principal objective at the present juncture
should be to set employment-generating
private investment on a rising trajectory.
That frontal need, however, conflicts with a
whole set of other equally desperate needs,
and cannot be addressed by the finance min-
istry alone. Manufacturing, thermal power
generation, urban housing, all need assured
sources of water. Scarcity of water has
reached proportions that would make all but
The Karnataka state government is consid-
ering a ban on further construction of urban
housing in the city of Bengaluru, because of
the strain on the city’s water supply system.
That is a wise decision from multiple
points of view. There is a large stock of
unsold houses in the country, estimated by
one source at 1.28 million units, in a country
where the unmet need for housing is esti-
mated at 10 million units. The need is at the
affordable end, the unsold stock is across the
entire spectrum, but until housing develop-
ers manage to recover their investment, fur-
ther lending to the sector will suffer from
contagion. Then there was the impact of the
distortionary goods and services tax (GST)
lopsided levy pattern was a
bid to stamp out unac-
conflicts with a some others, which can
make the unsold stock sale-
ers, will be phased out in favour of GST
RET-01 for large taxpayers, and small tax-
counted-for wealth as a
source of working capital
whole set of able. The housing regula-
tor, the National Housing
payers will have to submit both that ( GST
RET-01)(quarterly) and GST PMT-08
for the housing sector. other equally Bank, should actually (monthly). All this is clearly driven by a bid to
In the event, as we know require consumer commit- return to invoice matching. That pincer
so well, non-banking desperate needs ment at the start of housing approach to tax evasion will fail in its reve-
financial companies projects, tantamount to a nue purpose if compliance complications
(NBFCs) stepped in, formal recognition of the serve as entry barriers to investment, espe-
financed by short-term capital raised mostly key role of the buyer in the earlier financing cially at the small end. Why could we not
from mutual funds. Today, NBFCs are tee- model. Most of all, GST levies need to be have stayed with the old forms for a few more
tering on the brink of bankruptcy. The key evened out between under-construction years while we try to induce investment in
component of the “purchase before comple- and completed housing. The burden of small business in a tax regime that is stable
tion” financing model which made it work so blocking the use of unaccounted-for wealth and well understood? GST revenue is not
well, was prior commitment on the part of cannot be placed on GST. doing so badly. The fault lies with budgeted
buyers. The new schemes financed by About GST itself, there seems to be a targets that have been far too ambitious.
 NEW DELHI, MUMBAI, BENGALURU, KOLKATA, CHENNAI, AHMEDABAD, HYDERABAD, CHANDIGARH*, PUNE* VOL. 13 NO. 160 Rs 5.00 IN DELHI-NCR; Rs 6.00 OUTSIDE DELHI-NCR. PRICE WITH HINDUSTAN TIMES Rs 9.50 (FOR DELHI & NCR)

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Congress panel likely to name TWITTERVERSE

interim president next week Siddaramaiah

@siddaramaiah
Dear @RahulGandhi,,
You led us during crisis
‘National minimum
Congress Working Committee is said to be considering a few senior leaders for the interim arrangement & gave us hope for
better India. There is
wage needed’ still time to reconsider
The Economic Survey Anuja former Uttarakhand chief minis- your decision & lead us
2019 suggests to bring anuja@livemint.com ter is incharge of Assam and has with same idea of
in a mandatory NEW DELHI been a key Gandhi family loyalist. United India.
national minimum On Thursday, Gandhi was in a

wage. P8
Behavioural change
to spur growth
The focus on behav-
ioural economics for
social change is one of
the new elements in
Economic Survey. P9
India needs $80 bn
for green economy
India’s emerging
green economy will
require investments of
around $80 billion by
2022. P10
Survey calls for
judiciary reforms
The Economic Survey
calls for reforms in dis-
trict and subordinate
courts to reduce pend-
ency of cases. P11
A
day after Rahul Gan-
Six Indian dhi made his resigna-
metros are
hotspots of
tion as Congress pres-
air pollutant ident public and reas-
nitrogen serted that the
oxide: Congress Working Committee
Greenpeace
(CWC) should look for his succes-
bit.ly/2KVJ11L sor, senior leaders said the party’s
apex decision-making body could
likely meet next week to decide
the future course of action.
The CWC takes a final call on
the resignation of the party presi-
dent, but senior members of the
apex body feel there “is no going
back” and that the general sense is
that it would accept Gandhi’s res-
ignation.
Gandhi’s decision to not con-
tinue in the top post and a strong-
ly-worded four-page open letter
has thrown the party into a crisis.
The top leadership should resolve
the situation soon, as elections in
key states are lined up for later this
year, feel party leaders.
“We have lost nearly six weeks
since he offered to resign. Now
things are pretty clear and irre-
spective of some leaders reaching
out to him to continue, we think
there is no going back from here.
The CWC accepting his resigna-
tion will be a mere formality now,”
said a senior general secretary of
the party who is also a member of
Mumbai court pleading not guilty
to charges in a defamation case
filed by a Rashtriya Swayamsevak
Sangh (RSS) leader. Sitaram
Yechury, general secretary of the
Communist Party of India (Marx-
ist), or CPM, is also party to the
Milind Deora
case and is facing similar charges.
@milinddeora
“I am standing with the poor,
the farmers and workers. I am Shri Rahul Gandhi never
being attacked and I am enjoying hesitated to lead from
it,” he said outside the court in the front. In order to
Mumbai. revive, Congress must
When told that party workers now expedite the proc-
feel he should not have resigned, ess of selecting an able
Gandhi said: “ Whatever I had to successor.
say, I have said yesterday in my
note.” He added that the “fight”
Rahul Gandhi leaves a court in Mumbai on Thursday after pleading not guilty in a defamation case. PTI will be stronger from now on.
On Thursday, Congress general
the CWC, requesting anonymity. weekend, he said. tary who is also part of the CWC, secretary incharge of eastern Uttar
There could be more clarity on “Both will happen together, requesting anonymity. A few sen- Pradesh, Priyanka Gandhi Vadra,
the date of the CWC meeting once accepting the resignation and ior leaders are being considered tweeted that “few have the cour-
K.C. Venugopal, for the interim age” to do what Gandhi did by Asaduddin Owaisi
the general secre- NEXT COURSE OF ACTION arrangement, he resigning. @asadowaisi
tary incharge of said. Gandhi had offered to resign at Well done sanghi mob
o r g a n i z a t i o n , WHEN the CWC CONGRESS may IN another setback, Gandhi’s resig- a CWC meeting on 25 May, soon lynchers you have
returns to Delhi meets, it will formally appoint an interim
accept Rahul chief soon as crucial
Congress general
secretary incharge for
nation prompted after the election results were brought disrepute to
from Kerala, Gandhi’s resignation state polls are lined Assam Harish Rawat many party lead- announced. The CWC did not Bharat by your inhu-
according to from party chief post up for later this year has also resigned ers to step down accept his resignation. On mane actions, which is
another party from their posts Wednesday, Gandhi wrote a note being mentioned in
leader, who also over the last fort- on social media in which he clari- UNHRC. PM Modi wants
spoke on the condition of ano- appointing an interim chief. While night. However, the decision of fied that he was not going to back 5 trillion economy when
nymity. Both Gandhi and former there is a lack of clarity right now, senior general secretary Harish down on his decision, and said the hate is being institution-
Congress president Sonia Gandhi someone’s name will come up Rawat to resign is yet another set- CWC should take steps to find his alised?
are likely to travel abroad this soon,” said another general secre- back for the Congress, as the successor soon.

In revamp, JD(S) names PURI WELCOMES LORD JAGANNATH LS passes bill allowing
H.K. Kumaraswamy as voluntary use of Aadhaar
Karnataka unit chief PTI
feedback@livemint.com
NEW DELHI
cerns. It provides that no ser-
vice or benefit of any scheme
will be denied for lack of Aad-
haar,” Prasad said.
Sharan Poovanna

T
he Lok Sabha on Thurs- The amended bill also pro-
sharan.p@livemint.com day passed a bill to allow vides for a stiff ₹1 crore penalty
BENGALURU voluntary use of Aad- and a jail term for private enti-
haar as proof of identity for ties for storing Aadhaar data.

F
ormer Prime Minister opening bank accounts and “As many as 1.23 billion peo-
and Janata Dal (Secular) procuring mobile ple are currently
supremo H.D. Deve phone. No service or using Aadhaar...
Gowda on Thursday named The Aadhaar benefit of any All safeguards are
six-time legislator H.K. and Other Laws scheme will now in place to pro-
Kumaraswamy as the party’s ( A m e n d m e n t ) be denied for lack hibit misuse of
new state president. The move Bill, 2019, was
of Aadhaar, said Aadhaar biomet-
is part of an effort to rebuild passed by a voice rics. Iris and fin-
the party after its dismal per- vote after infor- IT minister Ravi ger print data is
formance in the Lok Sabha mation technol- Shankar Prasad stored in Indian
elections. Newly elected JD(S) state unit ogy minister Ravi machinery and it
Kumaraswamy, who repre- chief H.K. Kumaraswamy (right) Shankar Prasad is safe and
sents Scheduled Castes, was and new working president assured the House that Aad- secure,” Prasad said.
made in-charge of the Vokkal- Madhu Bangarappa. PTI haar is voluntary and informed Displaying his personal
iga-backed party, as it faces an consent of the biometric iden- Aadhaar card in the House, he
existential threat with the I work as a diligent party mem- Hundreds of thousands of people participated in the annual Rath Yatra festival held amid tight security in Odisha’s Puri city on tity holder has to be obtained said Aadhaar data can only be
Congress and the Bharatiya ber, only then should I be Thursday. The festival was held nearly two months after Cyclone Fani barrelled through the temple town, where it claimed 64 lives. before it is used. shared when there is a threat
Janata Party (BJP) breathing given any post,” Nikhil said in The festival, which was attended by Odisha chief minister Naveen Patnaik, saw devotees pulling the chariots of the idols of Lord “The amendments address to national security or if there
down its neck. Bengaluru. Jagannath, Lord Balabhadra and Devi Subhadra in a ceremonial procession. PTI the privacy and security con- is a court order.
The JD(S) also named His appointment will help
former legislator Madhu Ban- retain some balance as the
garappa as its working presi- Gowda household witnesses a
dent. Chief minister H.D. battle for dominance between
Kumaraswamy’s son Nikhil Kumaraswamy and his brother
was named the leader of H.D. Revanna.
JD(S)’s youth wing. Revanna’s son Prajwal was
Nikhil’s elevation coincides the sole winner for the JD(S) in
Amazon-like platform to sell MSME, khadi products, says Gadkari
wi t h t ha t of the Karnataka
Udhayanidhi Sta- JD(S) also named Lok Sabha polls. Anuja & Prashant K. Nanda of the Lok Janshakti Party dur- Gadkari said his effort would have said has been done. If it
lin, the actor son Nikhil Prajwal, who NEW DELHI ing Question Hour, Gadkari be to create 50 million new jobs does not happen, then you can
of Dravida Mun- Kumaraswamy, congratulated the said he is serious about promot- through the sector. come back and question me.

T
netra Kazhagam son of H.D. new president he Union government ing the MSME sector globally. “Targets should be big…our But since I am announcing it,
(DMK) chief M.K.
Kumaraswamy, as and other office will start an e-commerce Amazon in the US and Ali- target is that in the next five this target too will be achieved
Stalin. Udhaya- bearers, said in platform on the lines of baba in China did a world of years, we will con- like roads,” he
nidhi was made the new JD(S) Delhi that he was “Amazon and Alibaba” to sell good to their MSME sector, tribute 50% to Amazon in the US said.
the head of the youth wing chief not aware of products from micro, small and Gadkari said. “On those lines, India’s gross There are 63.38
and Alibaba in
youth wing of Nikhil’s appoint- medium enterprises (MSMEs) for MSME and Khadi Gramud- domestic product China did a world million unincor-
DMK. ment, indicating and the Khadi and Village yog, we are going to launch a (GDP), and we will of good to their porated non-farm
Nikhil had unsuccessfully that all was not well within the Industries Commission. big marketing site. The prepa- give employment MSMEs in the
contested the parliamentary family.
respective MSME
MSME minister Nitin Gad- rations have started and a lot of to 5 crore (more) country engaged
elections against independent However, the JD(S) have kari informed the Lok Sabha on people and industries will have people,” Gadkari sectors, said in different eco-
candidate Sumalatha Amar- bigger problems, especially Thursday, a day before the access to it,” Gadkari said. said. Gadkari nomic activities,
nath (Sumalatha Ambareesh) with its alliance with the Con- Union budget is presented, that The MSME sector is a big Union MSME minister Nitin Gadkari. RAMESH PATHANIA/MINT His comments including 19.66
from the Mandya parliamen- gress perpetually in trouble, his ministry is in the process of driver of India’s manufacturing drew reaction million in manu-
tary seat. mostly emanating from within launching the online platform sector and plays a key role in The move to set up the small enterprises in India. from the opposition benches facturing and 23 million in
“At 11am today I got a call the latter’s ranks. to popularize and give market generating jobs. Yet, the sale of online platform is, therefore, Growth in the MSME sector with members saying there was trade activities, according to
from party leaders and I didn’t Gowda had earlier hinted at access to such products. products produced by MSME crucial as it could build aware- has the potential to bump up a lot of difference between data from the MSME ministry.
expect this at all. I had said a mid-term polls before back- Responding to a question companies suffer due to lack of ness and expand the global the country’s economy and cre- words and actions. The sector employs more than
few days ago in Malavalli that if tracking on his statements. from lawmaker Chandan Singh funds and marketing skills. reach for products made by ate more formal jobs. “You know that everything I 49.77 million people.