Markets regulator SEBI revised the framework for ‘block deals’ by
providing two separate trading windows of 15 minutes each and increasing the
minimum order size to Rs. 10 crore.
The move is aimed at ensuring confidentiality of the large trades and
stable prices for such transactions.
The block deal window is provided for buyers and sellers to execute
trades for a large number of shares. Such deals are usually negotiated
before their execution.
Under the new rules, SEBI would provide two block deal windows — morning
and afternoon — of 15 minutes duration each.
Besides, the regulator has increased the minimum order size for
execution of trades in the block deal window to Rs. 10 crore. Presently,
block deal for shares worth Rs. 5 crore through a single transaction is
The decision has been taken as SEBI received suggestions from market
participants to review the block deal framework.
The final norms have been put in place after taking into consideration
views of market participants and Secondary Market Advisory Committee (SMAC).
The morning window would operate from 8:45 a.m. to 9 a.m. and the
reference price for execution of block deals in this window would be the
previous day’s closing price of the stock.
With regard to afternoon window, the regulator said it would operate
from 2:05 pm to 2:20 pm.
The pricing would be based on the volume weighted average market price (VWAP)
of the trades executed in the stock in the cash segment between 1:45 p.m. to
India attracting investors in oil and gas sector
India is likely to attract investments worth more than $40 billion in
the next five years in the oil and gas sector alone as several global oil
companies such as Saudi Aramco, BP Plc., Vedanta Resources and Total of
France have evinced interest in investing in world’s fastest growing market,
oil minister DharmendraPradhan told.
“Cumulative estimated investments of $40 billion is expected in India’s
E&P [exploration and production] sector in the next 4-5 years. The total
investment required is $25 billion in production-sharing contract [PSC]
regime, of this FDP worth of $13.6 billion have been approved and investment
of $11.6 billion is under declaration of commerciality,” said Mr. Pradhan,
“During Pre-NELP and NELP, total investments of $40 billion has been
done. In the last three years, pending projects worth $25 billion have been
started. Our liberal policies and transformation reforms undertaken recently
had led to investments of $25.2 billion under the PSC regime.”
The government has come out with the HELP (Hydrocarbon Exploration and
Licensing Policy) framework with a vision to reduce India’s import
dependency in oil and gas by 10% by 2022.
“The ministry has enacted a series of reforms to incentivise domestic
exploration and production of oil and gas.
“Discovered small field (DSF) bid round 2016 introduced under a
liberalised framework has been extremely successful and we hope to get good
investments under the upcoming round of bids in December,” K.D. Tripathi,
Petroleum Secretary, said.
The government is banking on investments from three key reforms in the
petroleum sector- Open Acreage Licensing (OAL), Discovered Small Fields (DSF)
and Production Enhancement Contracts (PEC).
NHAI issuing bonds to finance highway projects
The National Highways Authority of India (NHAI) will soon issue bonds to
finance highway projects, Road Transport and Highways Minister, Nitin
“Foreign and domestic investments for building roads and highways
infrastructure would follow naturally because of the pro-active
infrastructural policies of the government.
“The NHAI is preparing to issue bonds worth lakhs of rupees by way of
tapping the capital market... efforts are [also] on to generate funds from
other such portfolios. This is being done to make sure that funds are raised
to support and finance roads and highways without any delay,” he said at the
112th Annual Session of PHD Chamber.
Mr. Gadkari had said that NHAI has a AAA rating that would help it tap
into the capital markets. He had said that funds to the tune of Rs. 4-5 lakh
crore can be raised from the markets for highway projects.
The Cabinet approved the BharatMalaPariyojana to build 34,800 km roads
worth Rs. 5.35 lakh crore.
It would include building economic corridors, inter-corridor and feeder
routes, national corridors efficiency improvement, border roads and
international connectivity, coastal roads and port connectivity and
For Bharatmala, Rs. 2.09 lakh crore will be raised as debt from the
market and Rs. 1.06 lakh crore will be mobilised through public-private
partnership (PPP). The remaining Rs. 2.19 lakh crore will flow from accruals
of the Central Road Funds and toll projects.
Recapitalisation is the need of the hour
Bankers have hailed the Union government’s decision to infuse Rs. 2.11
lakh crore in public sector banks, saying the move is the need of the hour.
“This milestone announcement on recapitalising banks in one go is a bold and
courageous move and is indeed the need of the hour,” Rajnish Kumar,
Chairman, State Bank of India, said.
“It will generate balance in overall demand and supply by bringing more
investments in sectors like infrastructure. These funds will also help in
efficiently managing risk and credit capital related requirements of the
banks,” he said.
Sharp rise in stressed assets in the past three years have eroded
capital of state-run lenders, which share a disproportionate burden of the
The move also comes as a relief for banks facing a corrective action of
the RBI following deterioration of assets quality and other financial
Karthik Srinivasan, group head, Financial Sector Ratings, ICRA, said the
infusion of funds would provide the capital required to absorb losses due to
“Most likely, the recapitalisation bonds are likely to be subscribed by
the banks ...,” he said.
India, U.S. talks to boost bilateral trade
India and the U.S. are slated to hold high-level talks to boost
bilateral trade and investment. On the agenda of the India-U.S. Trade Policy
Forum (TPF), scheduled to be held in Washington DC on October 26, are ways
to iron out irritants including ‘visa curbs’ of the U.S. and India’s ‘high
tariffs’ on manufactured products and ‘restrictions’ on e-commerce, as well
as steps to expedite the conclusion of negotiations on a bilateral social
security pact (or totalisation agreement).
The TPF, which is the main forum to resolve bilateral trade and
investment issues, is also likely to take up the ‘challenges’ that American
innovative industries face due to India’s ‘weak’ Intellectual Property
Rights regime. It would also discuss the ‘non-tariff barriers’ of the U.S.
that are adversely impacting India’s agriculture, pharmaceuticals and other
Both countries aim to increase bilateral goods and services trade to
$500 billion soon, from about $115 billion in 2016.
Industry bodies including USIBC and US-India Strategic Partnership Forum
(USISPF) are working with the governments of both the countries on
mechanisms to ensure greater engagement at the State-level, instead of
focusing entirely on the Central/Federal-level discussions.
Infusing capital to boost economy
The Centre unveiled an ambitious plan to infuse Rs. 2.11 lakh crore
capital over the next two years into public sector banks (PSBs)saddled with
high, non-performing assets and facing the prospect of having to take
haircuts on loans stuck in insolvency proceedings.
The move is vital for the slowing economy, as private investments remain
elusive in the face of the “twin-balance sheet problem” afflicting corporate
India and public sector banks reflected in slow bank credit growth.
Several economists opine that the recapitalisation of banks — so that
they can lend more freely and help revive private investment — is critical
for revitalising India’s growth momentum at a time when the global economy
Financial Services Secretary Rajiv Kumar said that the Union Cabinet had
approved the capital infusion plan for PSBs, adding that the funding pattern
would be front-loaded.
The Financial Services Secretary added that this would be funded through
budgetary provisions of Rs. 18,139 crore and the sale of recapitalisation
bonds worth Rs. 1.35 lakh crore. The balance would be raised by the banks
themselves by diluting the government’s equity share.
“Indiscriminate lending earlier by banks led to a high level of NPAs
(non performing assets),” Finance Minister Arun Jaitley said. “And these
NPAs were kept under the carpet. Now they have come to light because of the
Asset Quality Review conducted by the Reserve Bank of India.”
The capital infusion would also be accompanied by a series of banking
sector reforms, Mr. Jaitley said, without providing any specifics, adding
that the measures would be revealed in the coming months.
The government’s capitalisation package for public sector banks will
provide a strong booster dose of relief for the capital starved public
CRISIL’s assessment of capital requirement for public sector banks to
meet Basel III requirements is in the range of Rs. 1.4-1.7 lakh crore which
will be met by the government’s relief package.
Mr. Jaitley said the nature of the recapitalisation bonds would be
decided in the coming months, adding that the impact from the capital
infusion on the fiscal deficit would be determined by the type of bonds and
as to who the issuing authority would be.
Tourism Ministry proposes reduction in GST for 5-star hotels
The tourism ministry has proposed a reduction in the Goods and Services
Tax (GST) rates for five-star hotels and the grant of ‘infrastructure
status’ as part of measures to boost the vital jobs- and foreign exchange
Providing land on lower lease rentals for hotel construction, cutting
the number of permits needed to open hotels, as well as establishing a
National Tourism Regulator and the related regulatory framework are some of
the other proposals made by the ministry on Monday.
The aim is to ensure that within five years the sector generates 100
million jobs (from the current 43 million), attracts 40 million tourists
(from 14.4 million now), and generates $100 billion worth of foreign
exchange earnings (from about $24 billion at present).
The ministry has also set up four Joint Working Groups (JWGs) — one each
on hospitality sector, start-ups, ‘MICE’ or ‘Meetings, Incentives,
Conferences, and Events’-tourism, and niche tourism — to work on
recommendations from the industry, and bring out an ‘Action Plan’ with
specific targets and time lines to achieve them.
The JWGs would each have a representative from the tourism ministry, the
Department of Industrial Policy and Promotion, industry, and the
government’s investment facilitation and promotion wing ‘Invest India’.
The JWGs would submit their suggestions within a month, with the Centre
placing the recommendations in the public domain and also sharing regular
Action Taken Reports.
According to the tourism industry, the 28% GST rate renders India
uncompetitive, with foreign tourists opting to travel instead to
neighbouring countries such as Thailand, Malaysia and Singapore where the
tax rate on hotels was only 7% or lower.
‘Infrastructure status’ to the hotel sector would also help spur an
increase in the construction of budget hotels, the minister said. He said
currently, the infrastructure status was only available for projects above
Rs. 200 crore, adding that it should be extended to projects above Rs. 50
Pointing out that currently, the industry needs to obtain more than 70
permits to open a hotel, the minister said the number of permits should be
reduced drastically from such “outrageous” levels. The minister said the
approach being used by the Madhya Pradesh government, especially on making
it easier for the industry to get land and infrastructure, would be passed
on to other state governments as a model that they could consider adopting.
Additionally, the Centre would also work with the industry to soon bring
out a massive skill development programme aimed at the tourism industry, in
a manner that would help those being trained to secure jobs, Mr.
Melbourne Mercer Global Pension Index 2017
India has been ranked 28 out of the 30 countries under review in the
Melbourne Mercer Global Pension Index 2017, which was topped by Denmark for
the sixth straight year.
India’s overall index value increased from 43.4 in 2016 to 44.9 in 2017
and its pension system is found more sustainable than Poland, Germany,
France, Japan, Italy, Austria, Brazil, China and Argentina.
“The increase in value under the integrity sub—index from 53.4 to 55.1
is a reflection of Government of India’s continued efforts to improve the
transparency and member experience in various schemes,” Preeti
Chandrashekhar, India Business Leader — Retirement, Health and Benefits,
Railways to ask Finance Ministry to share in rail safety fund
The Ministry of Railways may ask the Finance Ministry to fund its share
of the railway safety fund this year as the public utility is staring at an
earnings shortfall of at least Rs. 10,000 crore in 2017-18, sources said.
With earnings deficit, the Ministry of Railways may find it difficult to
contribute its share towards the newly- constituted Rashtriya Rail Sanraksha
Rosh (RRSK) – a dedicated fund for critical safety-related works, a Ministry
official said on the condition of anonymity.
The Indian Railways’ income stood at Rs. 80,519 crore till September
compared with Rs. 76,405 crore till September last year. However, the actual
income was 8.45% lower than the targeted earnings till September this year.
The Railways had set a target of earning Rs. 1.88 lakh crore in 2017-18
against Rs. 1.65 lakh crore in 2016-17.
Finance Minister Arun Jaitley had announced the setting up a special
safety fund with a corpus of more than Rs. 1 lakh crore over a period of
five years in Budget 2017-18. According to the plan, while the Finance
Ministry would contribute Rs. 15,000 crore annually towards the fund, the
Ministry of Railways would fund the balance Rs. 5,000 crore every year.
In the first six months of the current financial year, the Indian
Railways had utilised a quarter of the safety fund as it had spent Rs. 5,031
crore from the RRSK. Although the Railways’ passenger and goods earnings had
increased 4.5% and 8.4% respectively till September this year compared with
the last year, its sundry earnings had declined sharply by 35.7% during this
Income from non-fare revenues, including land lease, advertising, PSU
dividends and catering department, form part of the sundry earnings.
Minister of Railways Piyush Goyal had said in an interview to The Hindu
last month that the utility was willing to spend unlimited funds on safety
which would be a top priority for him. “In my working, there is no budget
for safety. Whatever (fund) is required we will spend,” Mr. Goyal had said.
Meanwhile, the Finance Ministry advised the Ministry of Railways to
prioritise deploying RRSK funds on areas that reduce chances of human error
and ensure training of safety staff.
WEF’s India Economic summit
World Economic Forum’s 33rd India Economic Summit will kick off, in
partnership with industry body CII. The theme of the conference, which will
be attended by key ministers of the government, including Finance Minister
Arun Jaitley and industrialists such as Sunil Bharti Mittal, is ‘Creating
Indian Narratives on Global Challenges’.
“More than 650 leaders from 35 countries are taking part, allowing
Indian business, society and government leaders to interact and collaborate
with peers from across the globe,” WEF said in a statement.
The summit would discuss issues such as climate change, infrastructure
and gender parity, besides demonetisation and the GST.
Many more problems before Electric vehicles
India’s transition to EVs could have far-reaching implications for the
global oil economy. “India, the world’s third-largest consumer and
fastest-growing major market, could see a cut of 8%-20% of current annual
oil demand,” the report said.
Affordability challenge could be addressed with an India-specific EV, it
The government has set an ambitious EV sales ratio target of 40% in 2032
with almost 100% in commercial applications (compares with China’s EV target
of 20% by 2025).
“We believe this target will be difficult to achieve; our base case
(moderate adoption) forecasts an EV sales ratio of 13% for cars in 2032, 25%
for 2-wheelers and 55% for buses,” the report said.
Nevertheless, according to Goldman Sachs, the late mover advantage may
help India in its endeavour. “This should enable it to benefit from lessons
learnt in other countries,” it added.
According to Ashok Jhunjhunwala, Principal Advisor, Ministry of Power &
New and Renewable Energy, Government of India, the key challenge for
development of electric vehicles would yet be the issue of subsidy.
There was an urgent need for a strong policy framework to promote Indian
manufacturing and support from the Government to nudge Indian stakeholders
move towards EV gradually, it said.
The fact of the matter, however, is that green has become a hot subject
of debate and ‘EV’ has become the new buzz word — a fancy one, at that, in
the world of Indian automobiles.
The first ever shipment of U.S. crude oil Reached India
The first ever shipment of U.S. crude oil of 1.6 million barrels,
purchased by state-run Indian Oil Corporation (IOC), was received at Paradip
The shipment is a part of recent commitments to purchase U.S. oil by
IOC, Bharat Petroleum (BPCL) and Hindustan Petroleum (HPCL).
IOC has placed a cumulative order for 3.9 million barrels from the U.S.
while BPCL and Hindustan Petroleum have placed orders for about 2.95 million
barrels and one million barrels, respectively.
“The inclusion of the U.S. as a source for crude oil imports by India’s
largest refiner will go a long way in mitigating the risks arising out of
U.S. crude oil shipments to India have the potential to boost bilateral
trade by up to $2 billion, according to a. U.S. Embassy release.
The crude oil shipment was delivered by MT New Prosperity, a Very Large
Crude Carrier (VLCC) of capacity 2 million barrels of crude, which left the
U.S. Gulf Coast on August 19.
The United States and India are elevating our cooperation in the field
of energy, including plans for cleaner fossil fuels, renewables, nuclear and
cutting edge storage and energy efficiency technologies.
Morgan Stanley predicts India to be world’s fastest growing large Economy
India is likely to be the world’s fastest-growing large economy in the
next 10 years, driven by digitisation, favourable demographics,
globalisation and reforms, predicts a Morgan Stanley report.
According to the global financial services major, the trend line in
India’s annual GDP growth has been accelerating to 6.9% in 2000s, from 5.8%
in the 1990s, and this momentum is likely to continue in the next decade as
Morgan Stanley expects digitisation will provide a boost of 50-75 bps to
GDP growth and forecast that India will grow to a $6-trillion economy by
Cost is a major problem in Electric vehicle
Add BHP Billiton and vacuum-cleaner maker Dyson to the list of converts
to the electric-vehicle revolution. Arnoud Balhuizen, chief commercial
officer at the world’s largest miner, told Reuters that battery-powered cars
will reach a tipping point this year.
With Tesla, Volvo, General Motors, Volkswagen and others all launching
or announcing new electric vehicles, it may sound like the internal
combustion engine is heading straight for the scrap yard.
There’s certainly willingness to switch to electric vehicles. Deutsche
Post, Unilever and IKEA were among 10 large enterprises that committed
recently to ditch gas guzzlers for battery- powered ones — but only by 2030.
Even BHP’s Mr. Balhuizen reckons it’ll take until 2035 to have 140
million electric autos on the roads compared to at most 2 million today. And
they’d account for less than a tenth of the global fleet.
Cost is a major problem. Cars powered solely by batteries are up to
$20,000 more expensive than gas-propelled ones, according to Evercore ISI. A
driver of the GM Bolt could save $300 a year on fuel.
That means it’d take at least 30 years to cover the extra outlay,
estimate the bank’s analysts — almost three times longer than the average
American car stays in service.
Over time, those costs will come down, though increased demand is
already pushing up the price of key raw materials like lithium and copper.
The rise of autonomous driving may change the economics.
Trouble is, that remains years off. And there are other challenges.
Access to some metals is far from secure: around half of the current supply
and estimated reserves of cobalt are in the DRC, a country plagued by
conflict, drought and child labour.
Add up the various prognostications and electric-only-powered cars, with
most driving themselves, will almost certainly become the norm by
mid-century. That’s still plenty of time for the internal combustion engine
to ride off into the sunset.